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EXHIBIT 10.46
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated as of
October 23, 1998, is entered into by and among:
(1) SILICON VALLEY GROUP, INC., a Delaware corporation ("Borrower");
(2) Each of the financial institutions listed in Schedule I to the
Credit Agreement referred to in Recital A below (collectively, the
"Lenders"); and
(3) ABN AMRO BANK N.V., acting through its San Francisco
International Branch, as agent for Lenders (in such capacity, "Agent").
RECITALS
A. Borrower, the Lenders and Agent are parties to a Credit Agreement
dated as of June 30, 1998 (the "Credit Agreement").
B. Borrower has requested the Lenders and Agent to amend the Credit
Agreement in certain respects.
C. The Lenders and Agent are willing so to amend the Credit Agreement
upon the terms and subject to the conditions set forth below.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Borrower, the Lenders and Agent hereby agree as follows:
1. DEFINITIONS, INTERPRETATION. All capitalized terms defined above and
elsewhere in this Amendment shall be used herein as so defined. Unless otherwise
defined herein, all other capitalized terms used herein shall have the
respective meanings given to those terms in the Credit Agreement, as amended by
this Amendment. The rules of construction set forth in Section I of the Credit
Agreement shall, to the extent not inconsistent with the terms of this
Amendment, apply to this Amendment and are hereby incorporated by reference.
2. AMENDMENTS TO CREDIT AGREEMENT. Subject to the satisfaction of the
conditions set forth in Paragraph 4 below, the Credit Agreement is hereby
amended as follows:
(a) Subparagraph 5.03(b) is hereby amended to read in its entirety as
follows:
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(b) Fixed Charge Coverage Ratio. Borrower shall not permit its
Fixed Charge Coverage Ratio for any period set forth below to be less
than the ratio set forth opposite such period below:
The quarter ending on
July 2, 1999 2.00;
The consecutive two-quarter
period beginning on April
3, 1999 and ending on
October 1, 1999 2.50;
The consecutive three-quarter
period beginning on April
3, 1999 and ending on
December 31, 1999, and
each consecutive four-
quarter period ending
on the last day of each
quarter thereafter 3.50.
(b) Subparagraph 5.03(d) is hereby amended to read in its entirety as
follows:
(d) Tangible Net Worth. Borrower shall not permit its
Tangible Net Worth on the last day of any fiscal quarter (such
date to be referred to in this Subparagraph 5.03(d) as a
"determination date") which occurs on or after October 2, 1998
(such date to be referred to in this Subparagraph 5.03(d) as the
"base date") to be less than the sum on such determination date
of the following:
(i) Five Hundred Twenty Eight Million Seven Hundred
Seventy Seven Thousand Dollars ($528,777,000);
plus
(ii) Eighty percent (80%) of the sum of Borrower's
consolidated quarterly net income (ignoring any quarterly
losses) for each fiscal quarter after the base date through
and including the fiscal quarter ending on the determination
date;
plus
(iii) Seventy-five percent (75%) of the Net Proceeds of
all Equity Securities issued by Borrower and its
Subsidiaries (to Persons other than Borrower or its
Subsidiaries) during the period commencing on the base date
and ending on the determination
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date;
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plus
(iv) Seventy-five percent (75%) of the principal amount
of all debt securities of Borrower and its Subsidiaries
converted into Equity Securities of Borrower and its
Subsidiaries during the period commencing on the base date
and ending on the determination date.
minus
(v) The lesser of (A) the aggregate amount paid by
Borrower (including reasonable expenses incurred in
connection therewith) to repurchase up to one million shares
of its common stock during the period commencing on the base
date and ending on the determination date and (B)
$10,000,000.
(c) Subparagraph 5.03(e) is hereby amended to read in its entirety as
follows:
(e) Profitability.
(i) For the quarter ending October 2, 1998, Borrower shall
not permit its Adjusted Net Income to be a loss exceeding
$30,000,000.
(ii) During the period October 3, 1998 - April 2, 1999,
Borrower shall not permit (A) its Adjusted Net Income for any
quarter to be a loss exceeding $15,000,000 or (B) the sum of all
such quarterly losses (excluding any quarterly profits) to exceed
$25,000,000.
(iii) During the period April 3, 1999 - December 31, 1999,
Borrower shall not permit the sum of all quarterly losses based
upon its Adjusted Net Income (excluding any quarterly profits) to
exceed $5,000,000.
(iv) Thereafter, Borrower shall not permit (A) its Adjusted
Net Income for any quarter to be a loss exceeding $10,000,000,
(B) its Adjusted Net Income to be a loss in more than two
quarters in any consecutive four-quarter period (commencing with
the consecutive four-quarter period ending on March 31, 2000) or
(C) its Adjusted Net Income for any consecutive four-quarter
period (commencing with the consecutive four-quarter period
ending on March 31, 2000) to be a loss.
3. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants to Agent and the Lenders that the following are true and correct on the
date of this Amendment and
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that, after giving effect to the amendments set forth in Paragraph 2 above, the
following will be true and correct on the Effective Date (as defined below):
(a) The representations and warranties of Borrower and its
Subsidiaries set forth in Paragraph 4.01 of the Credit Agreement and in the
other Credit Documents are true and correct in all material respects;
(b) No Default has occurred and is continuing; and
(c) Each of the Credit Documents is in full force and effect.
(Without limiting the scope of the term "Credit Documents," Borrower expressly
acknowledges in making the representations and warranties set forth in this
Paragraph 3 that, on and after the date hereof, such term includes this
Amendment.)
4. EFFECTIVE DATE. The amendments effected by Paragraph 2 above shall
become effective on October 23, 1998 (the "Effective Date"), subject to receipt
by Agent and the Lenders on or prior to the Effective Date of the following,
each in form and substance satisfactory to Agent, the Lenders and their
respective counsel:
(a) This Amendment duly executed by Borrower, the Required Lenders
and Agent;
(b) A Certificate of the Secretary of Borrower, dated the Effective
Date, certifying that the Restated Certificate of Incorporation and Bylaws
of Borrower, in the form delivered to Agent on the Closing Date, are in
full force and effect and have not been amended, supplemented, revoked or
repealed since such date;
(c) A nonrefundable amendment fee equal to 0.075% of each Lender's
Commitment to be paid to each Lender that executes this Amendment on or
before October 23, 1998; and
(d) Such other evidence as Agent or any Lender may reasonably request
to establish the accuracy and completeness of the representations and
warranties and the compliance with the terms and conditions contained in
this Amendment and the other Credit Documents.
5. EFFECT OF THIS AMENDMENT. On and after the Effective Date, each
reference in the Credit Agreement and the other Credit Documents to the Credit
Agreement shall mean the Credit Agreement as amended hereby. Except as
specifically amended above, (a) the Credit Agreement and the other Credit
Documents shall remain in full force and effect and are hereby ratified and
confirmed and (b) the execution, delivery and effectiveness of this Amendment
shall not, except as expressly provided herein, operate as a waiver of any
right, power, or remedy of the Lenders or Agent, nor constitute a waiver of any
provision of the Credit Agreement or any other Credit Document.
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6. MISCELLANEOUS.
(a) Counterparts. This Amendment may be executed in any number of
identical counterparts, any set of which signed by all the parties hereto
shall be deemed to constitute a complete, executed original for all
purposes.
(b) Headings. Headings in this Amendment are for convenience of
reference only and are not part of the substance hereof.
(c) Governing Law. This Amendment shall be governed by and construed
in accordance with the laws of the State of California without reference to
conflicts of law rules.
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IN WITNESS WHEREOF, Borrower, Agent and the Lenders have caused this Amendment
to be executed as of the day and year first above written.
BORROWER: SILICON VALLEY GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
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Title Vice President of Finance and CFO
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AGENT: ABN AMRO BANK, N.V.
By: /s/ Xxxxx X. Xxx
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Name: Xxxxx X. Xxx
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Title: Group Vice President
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By: /s/ Xxxxxxx X. XxXxxxx
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Name: Xxxxxxx X. XxXxxxx
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Title: Vice President
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LENDERS: ABN AMRO BANK, N.V.
By: /s/ Xxxxx X. Xxx
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Name: Xxxxx X. Xxx
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Title: Group Vice President
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By: /s/ Xxxxxxx X. XxXxxxx
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Name: Xxxxxxx X. XxXxxxx
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Title: Vice President
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COMERICA BANK-CALIFORNIA
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
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Title: Vice President and Assistant Manager
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FLEET NATIONAL BANK
By: /s/ Xxxxxx X. Xxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxx
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Title: Vice President
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KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: Assistant Vice President
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XXXXX FARGO BANK, N.A.
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
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Title: Vice President
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