THIRD AMENDMENT TO LINE OF CREDIT AGREEMENT
This THIRD AMENDMENT TO LINE OF CREDIT AGREEMENT ("THIRD AMENDMENT"), dated
as of October 24, 1996 ("Effective Date"), is entered into by and between
Novellus Systems, Inc. ("Borrower") and Sanwa Bank California ("BANK").
RECITALS
A. The Bank and the Borrower are parties to a Line of Credit Agreement
dated as of June 13, 1994, as amended by the Amendment to Credit Agreement dated
as of May 2, 1995, as amended by a Second Amendment to Line of Credit Agreement
dated as of April 5, 1996, (as so amended, the "Credit Agreement"), pursuant to
which the Bank has extended certain credit facilities to the Borrower and
certain of its subsidiaries.
B. The Borrower has requested that the Bank agree to certain amendments
to the Credit Agreement.
C. The Bank is willing to amend the Credit Agreement, subject to the
terms and conditions of this Third Amendment.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledge, Bank and Borrower mutually agree to amend said
Credit Agreement as follows:
1. DEFINED TERMS. Unless otherwise defined herein, capitalized terms
used herein shall have the meanings, if any, assigned to them in the Credit
Agreement.
2. AMENDMENTS TO CREDIT AGREEMENT.
(a) Section 4.05 of the Credit Agreement is hereby amended to
add the following at the end of the subsection:
"The Bank acknowledges that the Borrower will enter into a
Purchase and Master Lease Agreement, dated as of October 24, 1996, by and among
Novellus Systems, Inc., the lessors referred to therein and Sumitomo Bank
Leasing and Finance, Inc. as agent for the lessors, as the same may be amended
from time to time (the "Second Lease") and that from time to time Borrower may
grant a security interest with respect to its assets in connection with
Borrower's obligations under the Second Lease; and the Bank further acknowledges
and agrees that the entering into the Second Lease and the granting from time to
time of such security interests shall not be deemed to constitute a material
adverse change in the financial condition or operations of Borrower.
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(b) Section 5.12 of the Credit Agreement shall be amended by
replacing the semicolon at the end of subsection with a semicolon and adding the
following:
"provided, however, security interests granted from time to
time in connection with the obligations of Borrower pursuant to the Second Lease
shall not violate the terms of this subsection or this Agreement."
3. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents and
warrants to the Bank as follows:
(a) No Event of Default, or event which with the giving of
notice, the lapse of time, or both, would be an Event of Default, has occurred
and is continuing.
(b) The execution, delivery and performance by the Borrower of
this Third Amendment have been duly authorized by all necessary corporate and
other action and do not and will not require any registration with, consent or
approval of, notice to or action by, any person (including any governmental
authority) in order to be effective and enforceable. The Credit Agreement as
amended by this Third Amendment constitutes the legal, valid and binding
obligations of the Borrower, enforceable against it in accordance with its
respective terms, without defense, counterclaim or offset.
(c) All representations and warranties of the Borrower contained
in the Credit Agreement are true and correct.
(d) The Borrower is entering this Third Amendment on the basis
of its own investigation and for its own reasons, without reliance upon the Bank
or any other person.
4. EFFECTIVE DATE. This Third Amendment will become effective as of the
Effective Date, provided that the Bank has received from the Borrower a duly
executed original of this Third Amendment.
5. RESERVATION OF RIGHTS. The Borrower acknowledges and agrees that the
execution and delivery by the Bank of this Third Amendment shall not be deemed
to create a course of dealing or otherwise obligate the Bank to forbear or
execute similar amendments under the same or similar circumstances in the
future.
6. MISCELLANEOUS.
(a) Except as herein expressly amended, all terms, covenants and
provisions of the Credit Agreement are and shall remain in full force and effect
and all references therein to the Credit Agreement shall henceforth refer to the
Credit Agreement as amended by this Third Amendment. This Third Amendment shall
be deemed incorporated into, and a part of, the Credit Agreement.
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(b) This Third Amendment shall be binding upon and insure to the
benefit of the parties hereto and thereto and their respective successors and
assigns. No third party beneficiaries are intended in connection with this
Third Amendment.
(c) This Third Amendment shall be governed by and construed in
accordance with the law of the State of California (without regard to principles
of conflicts of laws).
(d) This Third Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument.
(e) This Third Amendment, together with the Credit Agreement,
contains the entire and exclusive agreement of the parties hereto with reference
to the matters discussed herein and therein. This Third Amendment supersedes
all prior drafts and communications with respect thereto. This Third Amendment
may not be amended except in writing executed by the Borrower and the Bank.
(f) If any term or provision of this Third Amendment shall be
deemed prohibited by or invalid under any applicable law, such provision shall
be invalidated without affecting the remaining provisions of this Third
Amendment or the Credit Agreement, respectively.
(g) Borrower covenants to pay to or reimburse the Bank, upon
demand, for all costs and expenses (including allocated costs of in-house
counsel) incurred in connection with the development, preparation, negotiation,
execution and delivery of this Third Amendment.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Third Amendment as of the date first above written.
SANWA BANK CALIFORNIA NOVELLUS SYSTEMS, INC.
By: /s/ illegible By: /s/ John P. Root
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Title: AVP Title: Treasurer
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