<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED: JUNE 30, 1996
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _______ TO _______ COMMISSION FILE
NUMBER 0-25434
-------
BROOKS AUTOMATION, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 04-3040660
-------- ----------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
15 ELIZABETH DRIVE
CHELMSFORD, MASSACHUSETTS
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
01824
(ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (508) 262-2566
_____________________________________________
INDICATE BY CHECK MARK WHETHER THE REGISTRANT: (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH
FILING REQUIREMENTS FOR THE PAST 90 DAYS.
YES X NO _____
---
AS OF JULY 31, 1996, THERE WERE OUTSTANDING 7,544,484 SHARES OF THE
COMPANY'S COMMON STOCK, $.01 PAR VALUE.
THIS REPORT, INCLUDING ALL EXHIBITS AND ATTACHMENTS, CONTAINS 15 PAGES.
--
Page 1 of 15
<PAGE>
BROOKS AUTOMATION, INC.
INDEX
<TABLE>
<CAPTION>
PAGE
PART 1 FINANCIAL INFORMATION NUMBER
- ------ --------------------- ------
<S> <C> <C>
Item 1 Financial Statements:
Consolidated Balance Sheet............................ 3
Consolidated Statement of Income...................... 4
Consolidated Statement of Cash Flows.................. 5
Notes to Consolidated Financial Statements............ 6-9
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations................... 10-13
PART II OTHER INFORMATION
- ------- -----------------
Item 6 Exhibits and Reports on Form 8-K...................... 14
SIGNATURES ...................................................... 15
</TABLE>
Page 2 of 15
<PAGE>
BROOKS AUTOMATION, INC.
CONSOLIDATED BALANCE SHEET
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30,
1996 1995
----- ----
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 4,843 $15,594
Accounts receivable, net of allowance for doubtful accounts of $80 and
$80, and including amounts due from related party of $7,732 and $3,118 21,767 12,964
Inventories 19,095 12,858
Deferred taxes 303 281
Prepaid expenses and other current assets 2,243 1,677
------- -------
Total current assets 48,251 43,374
Fixed assets, net 13,831 9,347
Other assets 981 859
------- -------
Total assets $63,063 $53,580
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 1,394 $ 1,522
Accounts payable 8,836 6,075
Accrued expenses and other current liabilities 3,525 2,533
Customer deposits 252 528
------- -------
Total current liabilities 14,007 10,658
Long-term debt 803 531
Deferred taxes - 169
------- -------
Total liabilities 14,810 11,358
------- -------
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; 1,000,000 shares authorized;
none issued and outstanding - -
Common stock, $.01 par value; 21,500,000 shares authorized;
7,521,321 and 7,469,591 shares issued 75 75
Additional paid-in capital 34,036 34,208
Cumulative translation adjustment (140) (136)
Retained earnings 14,399 8,214
------- -------
48,370 42,361
Less: Deferred compensation (117) (139)
------- -------
Total stockholders' equity 48,253 42,222
------- -------
Total liabilities and stockholders' equity $63,063 $53,580
======= =======
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
Page 3 of 15
<PAGE>
BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENT OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues, including revenues from related party of
$13,852 and $7,430 for the nine months and $7,059
and $2,082 for the three months ended
June 30, 1996 and 1995, respectively $66,446 $34,614 $25,280 $13,992
Cost of goods sold 38,478 20,609 14,813 8,244
------- ------- ------- -------
Gross profit 27,968 14,005 10,467 5,748
Research and development expenses 9,023 4,540 3,288 1,770
Selling, general and administrative expenses 9,183 4,822 3,410 2,039
------ ------ ------ ------
Income from operations 9,762 4,643 3,769 1,939
Interest expense 283 370 89 108
Interest income 312 235 41 128
------ ------ ------ ------
Income before provision for income taxes 9,791 4,508 3,721 1,959
Provision for income taxes 3,459 1,484 1,346 643
------ ------ ------ ------
Net income $6,332 $3,024 $2,375 $1,316
====== ====== ====== ======
Net income per share $0.77 $0.50 $0.29 $0.18
===== ===== ===== =====
Weighted average common and common equivalent shares 8,221 6,019 8,184 7,199
===== ===== ===== =====
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
Page 4 of 15
<PAGE>
BROOKS AUTOMATION, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
JUNE 30,
1996 1995
--------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 6,332 $ 3,024
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization 2,111 980
Deferred income taxes (284) 46
Increase (decrease) resulting from changes in operating assets and liabilities:
Accounts receivable (8,803) (5,296)
Inventories (6,237) (4,879)
Prepaid expenses and other assets (681) (1,153)
Accounts payable 2,761 825
Accrued expenses and other current liabilities 1,033 774
Customer deposits (276) (34)
------ ------
Net cash used in operating activities (4,044) (5,713)
------ ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments, net - (4,509)
Purchases of fixed assets (5,904) (3,276)
------ ------
Net cash used in investing activities (5,904) (7,785)
------ ------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net (repayments) borrowings under revolving line of credit (146) 1,950
Principal payments on long-term debt (334) (1,419)
Proceeds from issuance of common stock 67 14,076
Purchase and retirement of treasury stock (239) (39)
----- ------
Net cash (used in) provided by financing activities (652) 14,568
----- ------
Elimination of Techware's net cash activity for the three months
ended December 31, 1995 (147) -
Effects of foreign currency translation (4) 51
----- ------
Net increase (decrease) in cash and cash equivalents (10,751) 1,121
Cash and cash equivalents at beginning of period 15,594 725
-------- -------
Cash and cash equivalents at end of period $ 4,843 $ 1,846
======== =======
SUPPLEMENTAL CASH FLOW DISCLOSURES:
Cash paid for interest $ 313 $ 308
======== =======
Cash paid for taxes $ 3,350 $ 1,440
======== =======
</TABLE>
Capital lease obligations of $583 were incurred during the nine months ended
June 30, 1996, when the Company entered into several computer and office
equipment leases.
The accompanying notes are an integral part of these consolidated financial
statements.
Page 5 of 15
<PAGE>
BROOKS AUTOMATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
----------------------
The accompanying unaudited consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries, and have been
prepared in accordance with generally accepted accounting principles and
with the instructions to Article 10 of SEC Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair presentation have
been included. The accompanying unaudited consolidated financial statements
should be read in conjunction with the audited consolidated financial
statements of the Company which are included in the Company's Annual Report
on Form 10-K for the year ended September 30, 1995.
The results of operations for the three months and nine months ended
June 30, 1996 are not necessarily indicative of the results that may be
expected for the fiscal year ending September 30, 1996.
2. ACQUISITION
-----------
On February 28, 1996, the Company acquired Techware Systems Corporation
("Techware"), a developer, manufacturer and marketer of equipment control
software used primarily in the semiconductor and related industries. The
Techware acquisition has formed the base for establishing Brooks Automation
Canada. The Company issued 462,189 shares of common stock for all of the
Techware stock outstanding at February 28, 1996. The Techware acquisition
was accounted for as a pooling of interests, and therefore the Company's
consolidated financial statements for all periods prior to the Techware
acquisition have been retroactively restated to reflect the combination of
the operations and the accounts of Techware with those of the Company.
Due to the previously differing year-ends of the Company and Techware,
Techware's results of operations for the years ended December 31, 1995,
1994 and 1993 have been combined with the Company's results of operations
for the fiscal years ended September 30, 1995, 1994 and 1993, respectively.
The accompanying unaudited consolidated balance sheet at September 30, 1995
combines the financial position of Techware at December 31, 1995 with the
Company's financial position at September 30, 1995. The interim periods
presented are for the three months and nine months ended June 30, 1996 and
1995 for both the Company and Techware. Techware's unaudited results of
operations for the three months ended December 31, 1995 (including
revenues, operating income, and net income of $1,810,000, $234,000 and
$147,000, respectively) are included in both the unaudited results of
operations for the nine months ended June 30, 1996 and for fiscal 1995.
Therefore, Techware's net income for the three months ended December 31,
1995 was eliminated from consolidated retained earnings at June 30, 1996.
Page 6 of 15
<PAGE>
BROOKS AUTOMATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following information shows net revenue and net income for the separate
companies during the periods preceding the combination. Adjustments
recorded to conform the accounting policies of the companies were not
material to the unaudited consolidated financial statements.
<TABLE>
<CAPTION>
Three Months Year Ended
Ended September 30,
December 31, 1995 1995 1994 1993
----------------- ---- ---- ----
<S> <C> <C> <C> <C>
(in thousands)
Net revenue:
Brooks Automation $16,754 $45,691 $24,030 $13,714
Techware 1,810 5,266 2,637 2,711
------- ------- ------- -------
$18,564 $50,957 $26,667 $16,425
======= ======= ======= =======
Net income:
Brooks Automation $ 1,697 $ 4,578 $ 1,473 $ 910
Techware 147 364 144 228
------- ------- ------- -------
$ 1,844 $ 4,942 $ 1,617 $ 1,138
======= ======= ======= =======
</TABLE>
3. CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
-------------------------------------------
The Company considers all highly liquid investments purchased with an
original maturity of three months or less to be cash equivalents. During
the three months ended June 30, 1996, the Company invested its excess cash
in bank repurchase agreements. At June 30, 1996, all such investments are
designated as held-to-maturity as management believes it has the positive
intent and the ability to hold such securities until their stated
maturities. These repurchase agreements mature and are reinvested on a
daily basis. Held-to-maturity securities are stated at amortized cost,
adjusted for amortization of premiums and accretion of discounts to
maturity.
4. INVENTORIES
-----------
<TABLE>
<CAPTION>
Inventories consist of the following (in thousands): June 30, September 30,
1996 1995
---- ----
<S> <C> <C>
Raw materials $13,730 $ 8,902
Work-in-process 4,714 3,317
Finished goods 651 639
------- -------
$19,095 $12,858
======== =======
</TABLE>
Page 7 of 15
<PAGE>
BROOKS AUTOMATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
5. NET INCOME PER SHARE
--------------------
Net income per share is calculated using the weighted average number of
shares of common stock and common stock equivalents outstanding during the
periods. The common stock equivalents include shares issuable upon the
assumed exercise of stock options and warrants reflected under the treasury
stock method. Primary and fully-diluted net income per share are
essentially the same for the periods presented.
6. SIGNIFICANT CUSTOMER, RELATED PARTY
-----------------------------------
During the nine months ended June 30, 1996 and 1995, the Company had sales
to one customer which approximated 21% of net revenues in both periods.
This customer was a shareholder of the Company.
7. LONG-TERM DEBT
--------------
In June 1996, the Company replaced its $3.0 million secured, revolving line
of credit with a $15.0 million unsecured revolving credit facility and a
$3.0 million unsecured foreign currency line of credit, both of which
expire in December 1997. Under the new revolving credit facility, advances
will bear interest at the prime rate or the LIBOR rate plus 2%. Under the
foreign currency line of credit, advances will bear interest at the LIBOR
rate plus 2%. At June 30, 1996, the Company had borrowings approximating
$351,000 outstanding under the revolving credit facility.
8. STOCK OPTIONS
-------------
On July 25, 1996, the Board of Directors determined that certain stock
options issued to employees of the Company had an exercise price
significantly higher than the fair market value of the Company's common
stock. In light of the Board's conclusions that such options were not
providing the desired incentive, the Board provided employees with the
opportunity to exchange options previously granted to them for new options
(the "replacement options") to purchase the same number of shares of common
stock at an exercise price of $11.00 per share, the fair market value of
the Company's common stock on July 25, 1996. The vesting schedule for each
replacement option will commence on the date of the new grant and
replacement options will become exercisable over a five year period in
accordance with the Company's standard option vesting schedule. Subject to
the election of each optionholder, these new options will replace options
to purchase up to 347,900 shares of the Company's common stock with an
average price of $14.36 per share.
9. CONTINGENCIES AND COMMITMENTS
-----------------------------
There has been substantial litigation regarding patent and other
intellectual property rights in the semiconductor and related industries.
The Company has received notice from a third-party alleging infringements
of such party's patent rights by certain of the Company's products. The
Company's patent counsel are investigating the claim and the Company
believes the patents claimed may be invalid. In the event of litigation
with respect to this notice, the Company is prepared to vigorously defend
its position. However, because patent litigation can be extremely expensive
and time consuming, the Company may seek to obtain a license to one or more
of the disputed patents. Based upon information currently available to it,
the Company would only do so if license fees would not be material to the
Company's consolidated financial statements. Currently, the Company does
not believe that it is probable that future events related to this
threatened matter will have an adverse effect on the Company's business;
however, there can be no assurance that this will be the case. The Company
is currently unable to reasonably estimate any possible loss related to
this matter.
Page 8 of 15
<PAGE>
BROOKS AUTOMATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
9. CONTINGENCIES AND COMMITMENTS (CONTINUED)
-----------------------------------------
In May 1996, the Company negotiated a license with ADE Corporation
incorporating the non-exclusive right to use their wafer aligner patents.
The license arrangement will not have a material effect on the Company's
consolidated financial statements.
Page 9 of 15
<PAGE>
BROOKS AUTOMATION, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
NET REVENUES
- ------------
Net revenues for the three months ended June 30, 1996 increased 81% or $11.3
million to $25.3 million compared with net revenues of $14.0 million in the
comparable prior fiscal period. Sales of vacuum central handling systems,
components and control software comprised 82% of the increase in net revenues.
Current quarter shipments included the new 300 mm vacuum central wafer handling
system incorporating the MagnaTran 6 high speed vacuum transfer robot, the
Company's sixth generation product developed to enable production of advanced
semiconductors (feature sizes at .35 micron and below). The remainder of the
increase in net revenues was primarily attributable to sales of flat panel
display substrate handling systems and modules. Foreign revenues for the three
months ended June 30, 1996 increased to $3.8 million (15.0% of net revenues),
including $2.8 million of direct sales to Asian based customers, compared with
foreign revenues of $2.4 million (17.1% of net revenues) in the comparable prior
fiscal period.
Net revenues for the nine months ended June 30, 1996 increased 92% or $31.8
million to $66.4 million compared with net revenues of $34.6 million in the
comparable prior fiscal period, reflecting increased unit sales of vacuum
central substrate systems, substrate handling and conditioning modules, and
control software. Foreign revenues for the nine months ended June 30, 1996
increased to $11.9 million (17.9% of net revenues), including $8.3 million of
direct sales to Asian based customers, compared with foreign revenues of $3.7
million (10.7% of net revenues) in the comparable prior fiscal period.
GROSS PROFIT
- ------------
Gross profit as a percentage of net revenues was 41.4% and 42.1%, respectively,
for the three months and nine months ended June 30, 1996 compared with 41.1% and
40.5%, respectively, for the comparable prior fiscal periods. Cost reductions
achieved by the Company, primarily attributable to manufacturing efficiencies of
increased unit sales and increased sales of products incorporating higher value-
added control software, were partially offset by slightly higher material cost
content related to changes in product mix and new product introductions.
RESEARCH AND DEVELOPMENT EXPENSES
- ---------------------------------
Research and development expenses increased to $3.3 million (13.0% of net
revenues) and $9.0 million (13.6% of net revenues), respectively, for the three
months and nine months ended June 30, 1996 from $1.8 million (12.9% of net
revenues) and $4.5 million (13.0% of net revenues) in the comparable prior
fiscal periods. The increase in research and development expenses primarily
resulted from the Company's investment in the development of 300 mm vacuum
central wafer handling systems and substrate handling modules, VIS (vacuum
interface SMIF) technology, MagnaTran vacuum transport robots, control and
scheduling software, and new vacuum central substrate handling systems and
conditioning modules for the semiconductor and flat panel display process
equipment industries. The Company plans to continue to increase its investment
in research and development but expects that such expenses for the remainder of
the fiscal year will approximate fiscal 1995 spending levels as a percentage of
net revenues.
Page 10 of 15
<PAGE>
BROOKS AUTOMATION, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
- --------------------------------------------
Selling, general and administrative expenses increased to $3.4 million (13.4% of
net revenues) and $9.2 million (13.9% of net revenues), respectively, for the
three months and nine months ended June 30, 1996 from $2.0 million (14.3% of net
revenues) and $4.8 million (13.9% of net revenues) in the comparable prior
fiscal periods. The increase in selling, general and administrative expenses
resulted from the hiring of additional sales, marketing and administrative staff
to support the Company's international expansion, as well as the costs
associated with establishing and expanding operations in Japan, Korea and the
United Kingdom. The Company anticipates that selling, general and
administrative expenses will continue to increase in fiscal 1996 as the Company
commits more resources to market and sell its products internationally,
especially in Asia, and to support anticipated growth.
INTEREST EXPENSE
- ----------------
Interest expense decreased to $89,000 (0.4% of net revenues) and $283,000 (0.4%
of net revenues), respectively, for the three months and nine months ended June
30, 1996 from $108,000 (0.8% of net revenues) and $370,000 (1.1% of net
revenues) in the comparable prior fiscal periods. The decrease in interest
expense reflects lower average borrowings as a result of the Company's improved
working capital position following the Company's fiscal 1995 public offerings.
INTEREST INCOME
- ---------------
Interest income decreased to $41,000 (0.2% of net revenues) and increased to
$312,000 (0.5% of net revenues), respectively, for the three months and nine
months ended June 30, 1996 from $128,000 (0.9% of net revenues) and $235,000
(0.7% of net revenues) in the comparable prior fiscal periods. The decrease in
interest income in the three months ended June 30, 1996 reflects lower cash
balances in the latter part of the second quarter of fiscal 1996 compared with
the same period of fiscal 1995. The increase in interest income in the nine
months ended June 30, 1996 reflects higher cash balances available for
investment during the first half of fiscal 1996 following the Company's fiscal
1995 public offerings.
PROVISION FOR INCOME TAXES
- --------------------------
The Company's effective income tax rate was approximately 35% for the nine
months ended June 30, 1996 compared with approximately 33% in the comparable
prior fiscal period. The increase in the Company's effective income tax rate was
primarily due to the expiration in June 1995 of the federal research and
development tax credit.
Page 11 of 15
<PAGE>
BROOKS AUTOMATION, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
As of June 30, 1996, the Company had working capital of $34.2 million, including
$4.8 million of cash and cash equivalents, compared with working capital of
$32.7 million, including $15.6 million of cash and cash equivalents, as of
September 30, 1995. During the nine months ended June 30, 1996, the Company used
cash of $4.0 million in operating activities primarily to finance increased
accounts receivable and inventories resulting from revenue growth. Investment
activities for the nine months ended June 30, 1996 consisted of capital
expenditures primarily for reliability and test, and demonstration equipment.
The Company expects to continue to make capital expenditures to support its
business, especially growth in local customer support centers in key geographic
semiconductor and flat panel display markets.
In June 1996, the Company replaced its $3.0 million secured, revolving line of
credit with a $15.0 million unsecured revolving credit facility and a $3.0
million unsecured foreign currency line of credit, both of which expire in
December 1997. Under the new revolving credit facility, advances will bear
interest at the prime rate or the LIBOR rate plus 2%. Under the foreign
currency line of credit, advances will bear interest at the LIBOR rate plus 2%.
At June 30, 1996, the Company had borrowings approximating $351,000 outstanding
under the revolving credit facility.
In February 1995, the Company received net proceeds of $13.6 million from its
initial public offering of 2,000,000 shares of common stock. In July 1995, the
Company received net proceeds of $16.6 million from a secondary offering of
1,000,000 shares of the Company's common stock.
The Company believes that existing cash and cash equivalents together with
currently available bank credit lines and anticipated cash flows from operating
activities will be adequate to fund operations for at least the next twelve
months.
There has been substantial litigation regarding patent and other intellectual
property rights in the semiconductor and related industries. The Company has
received notice from a third-party alleging infringements of such party's
patent rights by certain of the Company's products. The Company's patent
counsel are investigating the claim and the Company believes the patents claimed
may be invalid. In the event of litigation with respect
Page 12 of 15
<PAGE>
BROOKS AUTOMATION, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
to this claim, the Company is prepared to vigorously defend its position.
However, because patent litigation can be extremely expensive and time
consuming, the Company may seek to obtain a license to one or more of the
disputed patents. Based upon information currently available to it, the Company
would only do so if license fees would not be material to the Company's
consolidated financial statements.
There can be no assurance that the Company would prevail in any litigation
seeking damages or expenses from the Company or to enjoin the Company from
selling its products on the basis of the alleged patent infringement, or that a
license for any of the alleged infringed patents will be available to the
Company on reasonable terms, if at all. Currently, the Company does not believe
that it is probable that future events related to this threatened matter will
have an adverse effect on the Company's business; however, there can be no
assurance that this will be the case. The Company is currently unable to
reasonably estimate any possible loss related to this matter.
In May 1996, the Company negotiated a license with ADE Corporation
incorporating the non-exclusive right to use their wafer aligner patents. The
license arrangement will not have a material effect on the Company's
consolidated financial statements.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
- -----------------------------------------------------------------------------
1995
- ----
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that such forward-looking statements involve risks and
uncertainties, including, without limitation, statements relating to the
adequacy of the Company's capital resources and certain of its projected
expenditures, the relatively few number of customers who account for a
substantial portion of the Company's net revenues, the ability of the Company to
manage its growth, the Company's success in international markets, the Company's
dependence upon cyclical industries and the success of its customers,
competitors, technological change, the Company's ability to develop new products
and other risks indicated from time to time in the Company's filings with the
Securities and Exchange Commission.
Page 13 of 15
<PAGE>
BROOKS AUTOMATION, INC.
PART II: OTHER INFORMATION
Item 6 (a) Exhibits
(10.2) Loan Agreement between Brooks Automation, Inc. and US Trust
dated June 25, 1996.
(10.21) Master Short Term Foreign Currency Borrowing Agreement
between Brooks Automation, Inc. and CoreStates Bank N.A.
dated June 18, 1996.
(11.01) Computation of per share earnings (incorporated herein by
reference to Note 5 of Notes to Consolidated Financial
Statements).
Item 6 (b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended June
30, 1996.
Page 14 of 15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BROOKS AUTOMATION, INC.
August 13, 1996 /s/ Robert J. Therrien
- --------------- _____________________________________
[Date] Robert J. Therrien
President and Chief Executive Officer
August 13, 1996 /s/ Stanley D. Piekos
- --------------- _____________________________________
[Date] Stanley D. Piekos
Vice President - Finance
Chief Financial Officer
Page 15 of 15
<PAGE>
Exhibit 10.2
~~~~LOAN AGREEMENT
THIS AGREEMENT dated as of June ____, 1996 is between BROOKS AUTOMATION,
INC., ("Parent"), a Delaware corporation having its principal place of business
at 15 Elizabeth Drive, Chelmsford, Massachusetts 01824, U.S.A., BROOKS
AUTOMATION CANADA CORP., a corporation organized under the laws of British
Columbia, Canada, having its principal place of business at _______ Street,
Vancouver, British Columbia, Canada, BROOKS AUTOMATION K.K., a stock corporation
organized under the laws of Japan, having its principal place of business at
________, BROOKS AUTOMATION LTD, a private company limited by shares organized
under the laws of England, having its principal place of business at
_____________________________, and BROOKS AUTOMATION MASSACHUSETTS SECURITIES
CORP., a Massachusetts corporation having its principal place of business at 15
Elizabeth Drive, Chelmsford, Massachusetts, U.S.A. 01824 (each entity a
"Borrower and collectively the "Borrowers") and USTRUST (the "Bank"), a
Massachusetts Trust Company having a place of business at 30 Court Street,
Boston, Massachusetts 02108.
WHEREAS, Borrower desires to maintain a $15,000,000 unsecured revolving
line of credit, and the Bank is willing to extend the line of credit subject to
the terms of this Agreement.
WHEREAS, the business operations of BROOKS AUTOMATION CANADA CORP., BROOKS
AUTOMATION K.K., BROOKS AUTOMATION LTD., and BROOKS AUTOMATION MASSACHUSETTS
SECURITIES CORP. are dependent on the continuation of the supply of goods and
services and/or the provision of working capital by the Parent to each of them.
NOW THEREFORE, in consideration of the agreements, representations and
warranties contained in this Agreement and of the performance by Borrower,
Borrower and the Bank agree, represent and warrant as follows:
SECTION
DEFINITIONS
Unless the context otherwise requires, the terms defined in this Section 1
will, for all purposes of this Agreement, have the meanings specified. The
following definitions are equally applicable to both the singular and plural
forms of any of the terms defined. All terms of accounting significance used
(unless otherwise specified) will be determined by reference to Borrower's books
of account and in conformity with generally accepted accounting principles as
applied to the books of account in the opinion of a certified public accountant
of recognized standing selected by Borrower and reasonably acceptable to the
Bank.
Advance. The Base Rate Loans or Eurodollar Loans made to the Borrower
pursuant to Section 2 hereof.
<PAGE>
Affiliate. Any Person who directly or indirectly controls, or is
controlled by, or is under common control with Borrower, except that the term
"Affiliate" does not include a subsidiary.
Aggregate Exposure. At any time, the sum of (i) the aggregate principal
amount of Advances outstanding at such time, plus (ii) the Letter of Credit
Exposure at such time, plus (iii) the Foreign Exchange Exposure at such time.
Agreement. This entire Loan Agreement with all the Exhibits, if any,
attached.
Bank. USTrust, its successors and assigns.
Base Rate. The rate of interest announced from time to time by the Bank at
its head office as its Base Rate.
Base Rate Loan. Any Advance bearing interest at a rate of interest based
on the Base Rate to be made as Base Rate Loans pursuant to the applicable notice
of borrowing or conversion.
Borrower. Brooks Automation, Inc., Brooks Automation of Canada Corp.,
Brooks Automation K.K., Brooks Automation, Ltd. and Brooks Automation
Massachusetts Securities Corp. and, at such time as any of the foregoing
entities has one or more Subsidiaries, each Subsidiary except where the context
of this Agreement prohibits such meaning.
Business Day. Any day (other than a day which is a Saturday, Sunday or
legal holiday in the Commonwealth of Massachusetts) on which banks are open for
business in Boston; provided that, when used in connection with a Eurodollar
Loan, the term "Business Day" shall also exclude any day on which banks are not
open for dealings in such Eurodollar deposits in the London interbank market.
Capital Lease. The lease of an asset capitalized under GAAP.
Consolidated Current Assets, Consolidated Current Liabilities, Consolidated
EBITDA, Consolidated Net Income, Consolidated Senior Liabilities, Consolidated
Subordinated Indebtedness, Consolidated Tangible Capital Base and Consolidated
Tangible Net Worth. These terms shall each mean Current Assets, Current
Liabilities, EBITDA, Net Income, Senior Liabilities, Subordinated Indebtedness,
Tangible Capital Base and Tangible Net Worth, as the case may be, of the
Borrowers and their Subsidiaries (whether or not ordinarily consolidated in
consolidated financial statements of the Borrowers and Subsidiaries), all
consolidated in accordance with GAAP and after giving appropriate effect to any
outside minority interest, provided that in determining Consolidated Net Income,
there shall be excluded (i) the Net Income of any Person (other than a
Subsidiary, the accounts of which are consolidated with the Borrowers for all
purposes of this Agreement) in which the Borrowers or any Subsidiary has an
ownership interest, except to the extent that any such Net Income has actually
been received by the Borrowers or such Subsidiary in the form of dividends or
similar distributions, (ii) the Net
<PAGE>
Income of a Person accrued prior to the date it becomes a Subsidiary or is
merged or consolidated with a Borrower or a Subsidiary, and (iii) any deferred
or other credit representing the excess of the equity in any Subsidiary on the
date of its acquisition over the cost of investment in such Subsidiary.
Default. Any event or condition specified in Section 5.1 so long as any
applicable requirements for the giving of notice or lapse of time or both have
not been fulfilled.
EBITDA. The aggregate of the consolidated Net Income of the Borrowers and
their Subsidiaries for the period in question plus the Interest, consolidated
Federal, state, local and foreign, taxes, depreciation and amortization of
tangible and intangible assets of the Borrowers and their Subsidiaries
attributable to such period, determined in accordance with GAAP consistently
applied.
Employee Plan. Any plan having the meaning stated in Section 4.9.2.
ERISA. The Employee Retirement Income Security Act of 1974, as amended
from time to time.
Eurodollar Loans. Any Advance bearing interest based on the LIBO Rate
pursuant to the applicable notice of borrowing or conversion.
Event of Default. Any event or condition specified in Section 5.1 if all
applicable requirements for the giving of notice or lapse of time or both have
been fulfilled.
Foreign Exchange Exposure. The outstanding Indebtedness of the Borrower
under foreign exchange contracts executed in accordance with Section 2.5.
GAAP. United States generally accepted accounting principles.
Indebtedness. With respect to any Person (a) all obligations of the Person
which in accordance with GAAP are classified upon the balance sheet of the
Person as liabilities (except capital stock and surplus earned or otherwise),
and in any event, without limitation by reason of enumeration, all indebtedness,
capitalized lease obligations, debt and other similar monetary obligations of
the Person, whether direct, indirect or guaranteed, all premium, if any, due at
the required prepayment date of the indebtedness and all indebtedness to any
partnership of which a Borrower is a general partner, but excluding endorsement
of obligations of others deposited by the Person to its account for collection;
and (b) all indebtedness secured by mortgage, pledge, lien, charge or
encumbrance on assets owned by the Person, whether or not the indebtedness was
actually created, assumed or incurred by the Person; and the acquisition by a
Person of assets subject to any mortgage, pledge, lien, charge or encumbrance
shall be deemed to be the equivalent of the creation, assumption and incurring
of the indebtedness secured by the assets. In computing the amount of
Indebtedness at any date, there shall be included an amount equal to all
reserves at the date in respect of debts and other similar monetary obligations
of the Person, either direct or guaranteed.
<PAGE>
Interest Period. (a) As to any Eurodollar Loan, the period commencing on
the date of such Advance or on the last day of the immediately preceding
Interest Period applicable to such Advance, as the case may be, and ending on
the numerically corresponding day (or, if there is no numerically corresponding
day, on the last day) in the calendar month that is between one (1) and six (6)
months thereafter; (b) as to any Base Rate Loan, the period commencing on the
date of such Advance or on the last day of the immediately preceding Interest
Period applicable to such Advance, as the case may be, and ending on the earlier
of the next succeeding first day of a calendar month, or the Termination Date;
provided, however, that if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless, in the case of a Eurodollar Loan only, such next succeeding
Business Day would fall in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day. Interest shall accrue from
and including the first day of an Interest Period to but excluding the last day
of such Interest Period.
Issuing Bank. With respect to any Letter of Credit or foreign exchange
contract under Section 2.5, the Bank or CoreStates Bank N.A., as applicable.
Legal Requirements. All statutes, codes, ordinances (and rules and
regulations thereunder), all executive orders and other administrative orders,
judgments, decrees, injunctions and other judicial orders of or by any federal,
state, provincial, municipal or other government (domestic or foreign), or any
department, commission, board, bureau, agency or instrumentality of any of them,
which may at any time be applicable to Borrower.
Letter of Credit. A letter of credit issued by an Issuing Bank for the
account of the Borrower and for the benefit of a creditor of a Borrower or one
of its Subsidiaries.
Letter of Credit Disbursement. A disbursement by an Issuing Bank to the
beneficiary of a Letter of Credit in connection with a drawing thereunder.
Letter of Credit Exposure. At any time the sum of (a) the aggregate
undrawn face amount of all outstanding Letters of Credit and (b) the aggregate
amount of all drawings under Letters of Credit for which an Issuing Bank shall
not have been reimbursed by the Borrowers.
LIBO Rate. The rate of interest determined by the Bank to be the
prevailing rate per annum at which deposits in U.S. dollars are offered by the
Bank in the interbank Eurodollar market in which it regularly participates on or
about 10:00 A.M. (Boston time) at least two Business Days before the first day
of the applicable Interest Period in an amount approximately equal to the
principal amount of the Advance to which such Interest Period is to apply for a
period of time approximately equal to such Interest Period.
Loan or Revolving Loan. The $15,000,000 line of credit extended by Bank to
Borrower under this Agreement.
<PAGE>
Loan Documents. This Agreement, the Promissory Note, and all other
agreements, documents, instruments and certificates delivered by Borrower or
others to the Bank in connection with this Agreement.
Net Income. For any Person for any period, it is the net income from
continuing operations less the sum of (i) extraordinary and nonrecurring gains,
(ii) gains from the sales of capital assets, and (iii) income from affiliates,
all determined in accordance with GAAP.
Obligations. (i) All of Borrowers' covenants, agreements and obligations
contained in the Loan Documents and (ii) all debts, liabilities ~and obligations
of any Borrower to Bank of every description, direct or indirect, absolute or
contingent, due or to become due, now existing or in the future arising. This
item also includes all costs and expenses, including reasonable attorneys' fees,
incurred by Bank in connection with this Agreement or the Obligations.
Parent. Brooks Automation, Inc.
Payment Date. Each date on which an interest payment is required to be
paid by the terms of the Promissory Note.
Pension Benefit Plan. This term has the meaning stating in Section 4.9.1.
Person. An individual, an association, a corporation, a partnership, a
limited liability company, a joint stock association, a business trust or a
government or any agency or subdivision of a government.
Promissory Note. The promissory note of Borrower in the principal amount
of $15,000,000 executed in connection with this Agreement, evidencing the Loan
and substantially in the form of Exhibit A attached.
Subsidiary. Any Person (other than an individual) of which a Borrower or
one or more Subsidiaries or the Borrower and one or more Subsidiaries shall (i)
at the time own shares (however designated) having ordinary voting power for the
election of a majority of the members of the board of directors (or other
governing body) of such Person, other than shares having such power only by
reason of the happening of a contingency, or (ii) possess, directly or
indirectly, the power to direct or cause the direction of the management or
polices of such Person, whether through the ownership of voting securities, by
contract or otherwise. The term "Subsidiary" also means each entity listed on
Schedule 4.1.
Tangible Net Worth. As applied to any Person, the aggregate of the
Person's (i) capital stock (but excluding treasury stock and capital stock
subscribed and unissued) plus (or minus in the case of a deficit) (ii) its
surplus (including earned surplus, capital surplus and the balance of the
current profit and loss account not transferred to surplus), less the sum of the
following items to the extent included in the determination of the amount of the
Person's capital stock and surplus:
<PAGE>
(a) the value of any assets which would be treated as intangibles
under generally accepted accounting principles, including, without limitation,
such items as goodwill, trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect to the foregoing;
(b) any write-up in the book value of any assets resulting from a
revaluation thereof;
(c) all deferred charges and organizational costs; and
(d) advances and loans to any Person.
Termination Date. December 31, 1997.
Wholly-Owned. As applied to any Subsidiary, shall mean any Subsidiary, all
of the outstanding shares of which, other than directors' qualifying shares,
shall at the time be owned by any Borrower or by one or more Wholly-Owned
Subsidiaries or by any Borrower and one or more Wholly-Owned Subsidiaries.
SECTION
REVOLVING LOAN
Subject to the terms of this Agreement and in reliance on the
representations, warranties and agreements of Borrower, the Bank agrees to make
the Revolving Loan described in this Section 2.
Revolving Loan. From time to time before the earliest to occur of (a)
a Default, or (b) the Termination Date, Borrowers may borrow, repay and reborrow
sums under the Revolving Loan, provided that the principal amount of the
Revolving Loan at any time outstanding may not exceed $15,000,000. At the time
of the execution of this Agreement, Borrowers agree to execute and deliver to
the Bank the Promissory Note evidencing the Revolving Loan.
Subject to an aggregate limit of $5,000,000 at any time
outstanding, Advances under the Revolving Loan may also be used to repay
obligations arising with respect to any one or more of the following:
(a)Letters of Credit, and
(b)foreign exchange contracts,
all as more particularly specified in Sections 2.4 and 2.5 below.
Whenever a Borrower desires to obtain an Advance hereunder, or
convert an outstanding Advance into an Advance of another type, the Borrower
shall notify the Bank
<PAGE>
(which notice shall be irrevocable) by telex, facsimile, or telephone received
no later than 12:00 p.m. Boston time on the day on which the request Advance is
to be made as or converted into a Base Rate Loan, and received no later than
10:00 a.m. Boston time on the date three (3) Business Days in advance of the
time at which the requested Advance is to be made as or converted into a
Eurodollar Loan, specifying (i) the amount and effective date of each Advance
desired, (ii) whether the Advance is to be a Eurodollar Loan or a Base Rate
Loan, (iii) if such Advance is to be made as or converted into a Eurodollar
Loan, the Interest Period applicable to the Advance, and (iv) in the case of the
conversion of an Advance, the Advance so to be converted. Each such notification
shall be immediately followed by a written confirmation thereof by the Borrower
in substantially the form of Exhibit B hereto. The Advances comprising the
Eurodollar Loans shall be in the aggregate principal amount which is an integral
multiple of $500,000.
The outstanding principal balance of each Advance under a
Eurodollar Loan shall be payable on the last day of the Interest Period
applicable to such Advance and on the Termination Date. The outstanding
principal balance of each Advance under a Base Rate Loan shall be payable on the
Termination Date. Each Advance shall bear interest on the outstanding principal
balance thereof as set forth in Section 2.2.
The Advances made by the Bank shall be evidenced by the Bank in
an account maintained on the books of the Bank which shall be designated as the
Borrowers' "Loan Account" in which account a record of all Advances will be
kept, indicating the date each Advance was extended, the amount of the Advance,
and the Interest Rate applicable to such Advance, each payment of principal of
any such Advance, each payment of interest on any such Advance and such other
information as the Bank may determine; provided, however, that the failure of
the Bank to make such a notation or any error therein shall not affect the
obligation of the Borrower to repay the Advance made by the Bank in accordance
with the terms of this Agreement and the Promissory Note.
Interest.
Subject to the provisions of Section 2.2.4, the Advances
comprising each Base Rate Loan shall bear interest (computed on the basis of the
actual number of days elapsed over a year of 360 days) at a rate per annum equal
to the Base Rate.
Subject to the provisions of Section 2.2.4, the Advances
comprising each Eurodollar Loan shall bear interest (computed on the basis of
the actual number of days elapsed over a year of 360 days) at a rate per annum
equal to the LIBO Rate for the Interest Period for such Advance plus 2%.
In the event, and on each occasion, that on the day two Business
Days prior to the commencement of any Interest Period for a Eurodollar Loan the
Bank shall have determined that deposits in the principal amount of the
requested Advance are not generally available in the London interbank market, or
that the rates at which such deposits are being offered will not adequately and
fairly reflect the cost to the Bank or any participant lender making or
maintaining the Eurodollar Loan during such Interest Period, or that reasonable
means do not
<PAGE>
exist for ascertaining the LIBO Rate, the Bank shall, as soon as practicable
thereafter, give written, telex, facsimile, or telephone (promptly confirmed in
writing or by telex) notice of such determination to the Borrowers. In the event
of any such determination, any request by the Borrowers for a Eurodollar Loan
pursuant to this Agreement shall, until the Bank shall have advised the
Borrowers that the circumstances giving rise to such notice no longer exist, be
deemed to be a request for a Base Rate Loan.
Interest on each Advance shall be payable on the Interest Payment
Dates applicable to such Advance except as otherwise provided in this Agreement.
The applicable Base Rate or LIBO Rate for each Interest Period or day within an
Interest Period, as the case may be, shall be determined by the Bank, and such
determination shall be conclusive absent manifest error.
If the Borrowers shall default in the payment of the principal of
or interest on any Advance or any other amount becoming due hereunder, by
acceleration or otherwise, the Borrowers shall on demand from time to time pay
interest, to the extent permitted by law, on such defaulted amount up to (but
not including) the date of actual payment (after as well as before judgment) at
a rate per annum (computed on the basis of the actual number of days elapsed
over a year of 360 days) equal to the then current interest rate for Base Rate
Loans plus 2%.
The Bank will automatically charge Borrowers' account monthly for
all amounts due under the Revolving Loan.
Notwithstanding the foregoing, any payment not received within
fifteen (15) days of its due date will be subject to an additional charge of
five percent (5.00%) of the amount due.
Additional Costs; Reserve Requirements. Notwithstanding any other
provision herein, if after the date of this Agreement any change in applicable
law or regulation or in the interpretation or administration thereof by any
governmental authority charged with the interpretation or administration thereof
(whether or not having the force of law) shall change the basis of taxation of
payments to the Bank or any participant lender on the principal of or interest
on any Eurodollar Loan made by the Bank or any participant lender or any fees or
other amounts payable hereunder, or shall impose, modify or deem applicable any
reserve, special deposit or similar requirement against assets of, deposits with
or for the account of or credit extended by the Bank or such participant lender
(except any such reserve requirement which is reflected in the LIBO Rate) or
shall impose on the Bank or participant lender or the London interbank market
any other condition affecting this Agreement or Eurodollar Loans made by the
Bank or participant lender, and the result of any of the foregoing shall be to
increase the cost to the Bank or participant lender of making or maintaining any
Eurodollar Loan or to reduce the amount of any sum received of receivable by the
Bank or participant lender hereunder or under the Promissory Note (whether of
principal, interest or otherwise) by an amount deemed by the Bank or the
participant lender to be material, then the Bank shall notify the Borrowers
thereof and the Borrowers shall pay to the Bank the amount of such increase in
cost, reduction in income or additional expense. Until the Bank notifies the
Borrowers that the circumstances giving rise to
<PAGE>
such notice no longer apply, the obligation of the Bank to allow conversion to
or selection or renewal of Eurodollar Loans by the Borrowers shall be suspended.
Letters of Credit.
Subject to the terms and conditions and relying on the
representations and warranties herein set forth, the Bank, by itself or through
the other Issuing Bank, agrees to issue Letters of Credit for the account of the
Borrower, subject to the availability of an Advance under Section 2.1 hereof;
provided, however, that (i) the Borrowers have executed a letter of credit
agreement substantially in the form of Exhibit C, (ii) the obligation of the
Issuing Bank to issue any Letters of Credit shall be subject to the approval by
it of the form, terms and conditions of such Letter of Credit to be issued by
such bank and any related documentation, and (iii) the Issuing Bank shall not
issue any Letter of Credit if, after giving effect to such issuance, (A) the
Letter or Credit Exposure, together with the Foreign Exchange Exposure would
exceed $5,000,000, and (B) the Aggregate Exposure under the Revolving Loan would
exceed $15,000,000.
Each Letter of Credit shall by its terms expire on or prior to
the earlier of (i) the Termination Date and (ii) the first anniversary of the
date of its issuance. Each Letter of Credit shall by its terms provide for
payment of drawings in U.S. dollars. Unless otherwise approved in writing by the
Bank, each Letter of Credit shall be issued to support obligations of the
Borrowers incurred in the ordinary course of business.
The Borrowers shall give to the Bank written or telex notice of
each request for a Letter of Credit not less than five Business Days prior to
the proposed issuance thereof and, subject to the other provisions of this
Section 2.4, such request shall specify the proposed date of issuance (which
shall be a Business Day), the date on which such Letter of Credit is to expire,
the amount of such Letter of Credit, the name and address of the beneficiary of
such Letter of Credit and the purpose and proposed form of such Letter of
Credit.
The Borrowers' obligation to repay payments and disbursements
made by such Issuing Bank under the Letters of Credit shall be absolute,
unconditional and irrevocable under any and all circumstances and irrespective
of:
(a) any lack of validity or enforceability of any Letter or
Credit;
(b) the existence of any claim, setoff, defense or other right
which the Borrowers or any other person may at any time have against the
beneficiary under any Letter of Credit, such Issuing Bank, the Bank of any other
person in connection with this Agreement or any other agreement or transaction;
(c) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect
or any statement therein being untrue or inaccurate in any respect;
<PAGE>
(d) payment by such Issuing Bank under a Letter of Credit
against presentation of a draft or other document which does not comply with the
terms of such Letter of Credit; provided that such payment shall not have
constituted gross negligence or willful misconduct of such Issuing Bank; and
(e) any other circumstance or event whatsoever, whether or not
similar to any of the foregoing; provided that such other circumstance or event
shall not have been the result of gross negligence or willful misconduct of such
Issuing Bank.
Foreign Exchange Contracts. The Borrowers may, by notice to the Bank,
request foreign exchange contracts for the purpose of hedging their foreign
exchange exposure arising out of the ordinary course of business, and the Bank,
by itself or through the other Issuing Bank, shall enter into such foreign
exchange contracts with the Borrowers provided, however, that (a) the Borrowers
represent, warrant and covenant that such foreign exchange contract arises in
the ordinary course of business and not for speculative purposes, (b) the
Borrowers have entered into a foreign exchange facility agreement with the Bank
substantially in the form of Exhibit D, and (c) if, after giving effect to the
execution of such contracts (i) the Foreign Exchange Exposure together with the
Letter of Credit Exposure would not exceed $5,000,000, and (ii) the Aggregate
Exposure under the Revolving Loan would not exceed $15,000,000.
Special Deposits. The Borrowers shall, on the Business Day they
receive notice from the Bank of an Event of Default, deposit in an account with
the Bank, for the benefit of the Issuing Bank and the Bank, (a) an amount of
U.S. dollars in cash equal to the Letter of Credit Exposure as of such date; and
(b) an amount of U.S. dollars in cash equal to the Foreign Exchange Exposure
calculated on the date of deposit in U.S. dollars at the spot rate of exchange,
if applicable, for purchasing foreign currency on that date with U.S. dollars.
Such deposit shall be held by the Bank as collateral for the payment and
performance of the Obligations. So long as such Event of Default is continuing
the Bank shall have exclusive dominion and control, including the exclusive
right of withdrawal, over such account. Money in such account shall
automatically be applied by the Bank as follows: money deposited under clause
(a) shall be applied to reimburse the Issuing Bank(s) for Letter of Credit
Disbursements and, (b) if the maturity of the outstanding loans has been
accelerated, money deposited under clause (b) shall be applied to satisfy the
Obligations.
Payments. The Borrowers shall make each payment (including principal
of or interest on any Advance or any Fees or other amounts) hereunder and under
any other Loan Document not later than 12:00 (noon), Boston time, on the date
when due in the currency of the Advance to the Bank at its offices at 30 Court
Street, Boston, Massachusetts 02108 in immediately available funds. Each such
payment shall be applied to the Obligations then due and payable in such order
as the Bank shall determine. Whenever any payment (including principal of or
interest on any Advance or any Fees or other amounts) hereunder or under any
other Loan Document shall become due, or otherwise would occur, on a day that is
not a Business Day, such payment may be made on the next succeeding Business Day
and such extension of time shall in such case be included in the computation of
interest or Fees, if applicable.
<PAGE>
Taxes. Any and all payments by the Borrowers hereunder or under other
Loan Documents shall be made free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, (collectively the
"Taxes") imposed, levied, collected, withheld or assessed on such payments by
any governmental authority or political subdivision in the applicable territory
and required by it to be paid at source or shall be grossed-up to provide the
Bank the same amount after such Tax as it would have received without the
imposition of such Tax; provided, however, that the Borrowers agree to provide
statements, receipts or supporting data with respect to the payment of such Tax
by any Borrower, or certified statements and receipts and such other supporting
data as may reasonably be required by the Bank to establish that any such Tax
has been paid by Borrowers.
Conditions Precedent to the Loan. Bank's obligations under this
Agreement, including funding the Revolving Loan, are subject to the accuracy of
the representations and warranties made by Borrowers in the Loan Documents, to
the performance by Borrowers of their agreements in the Loan Documents, to the
terms provided in this Agreement, and to the satisfaction or waiver by Bank in
writing, in whole or in part, of each of the following additional conditions:
Authority. The Bank shall be satisfied as to the authority of
the Borrowers to enter into and deliver the Loan Documents.
Conflict with Outstanding Instruments. Consummation of the
transactions contemplated by this Agreement and compliance with the terms of the
Loan Documents will not conflict with or result in a breach of any outstanding
agreements or other instruments to which any Borrower is a party or by which any
Borrower or any of its property is bound.
Insurance. Bank shall have received satisfactory evidence that
the insurance required pursuant to Section 3.13 is in force and all premiums
paid.
Opinion of Counsel. Bank shall have received from counsel for
Borrowers, an opinion in substantially the following form and substance and
dated the date hereof that:
Brooks Automation, Inc. is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and
registered to do business in the Commonwealth of Massachusetts as a foreign
corporation, and that it has adequate corporate power and authority to own its
property and to conduct its business as presently conducted.
Brooks Automation Massachusetts Securities Corp. is a corporation
duly organized and validly existing under the Laws of the Commonwealth of
Massachusetts and that it has adequate corporate power to own its property and
to conduct its business as presently conducted.
Brooks Automation Inc. has full corporate power and authority to
enter into the Loan Documents, and the Loan Documents have been duly authorized
by it, have been duly executed and delivered by its authorized officers, and are
the legal, valid and binding
<PAGE>
obligations of it, enforceable in accordance with their terms, subject to, among
other things, laws of general application affecting the rights and remedies of
creditors.
To the knowledge of such counsel, there are no actions, suits or
proceedings pending, or threatened against or affecting Brooks Automation, Inc.
which would have a material or adverse affect on it or its property in any court
or before or by any federal, state, municipal, or any department, commission,
board, bureau, agency or instrumentality, and, to the knowledge of such counsel,
no Borrower is in default of any order, writ, injunction, decree or demand of
any court or federal, state, municipal, or any department, commission, board,
bureau, agency or instrumentality which, if not cured, would have a material
adverse effect.
No Borrower is in violation of any term of its statutory
organizational documents or its by-Laws. The execution, delivery and performance
of the Loan Documents and the taking of action contemplated thereby will not
result in any violation of or be in conflict with or constitute a default under
any such term of which such counsel has knowledge, or result in the creation of
any mortgage, lien, charge, or encumbrance upon any of the properties or assets
of Borrower pursuant to any such term, other than as contemplated by the Loan
Documents.
No Material Adverse Change. There is no outstanding or
threatened litigation, contingent liabilities or other proceedings, the outcome
of which could materially or adversely affect any Borrower nor has there been
any material adverse change in the financial condition of any Borrower.
Satisfaction of Bank and its Counsel. All action to be taken in
connection with the transactions contemplated by the Loan Documents will be
reasonably satisfactory in form and substance to Bank and to Bank's counsel.
Bank shall have received copies of all documents which it may reasonably request
in connection with the transactions, which documents shall be in form and
substance reasonably satisfactory to Bank and to Bank's counsel.
Conditions Precedent to Advances. Bank's obligations with respect to
each request for an Advance under the Revolving Loan is subject to the continued
accuracy of the representations and warranties made by the Borrowers in the Loan
Documents, to the continued performance by Borrowers of their agreements in the
Loan Documents, and to the continued satisfaction of each of the conditions
contained in Sections 2.9.3 and 2.9.5 above at the time of each request for an
Advance.
SECTION
PARTICULAR COVENANTS OF BORROWERS
Payment of Principal and Interest. Each Borrower agrees to pay when
due the principal of and interest on the Revolving Loan and all such payments
shall, except as otherwise provided in Section 2.1.1, be in U.S. currency at the
time of payment.
<PAGE>
Keep Books and Set Aside Reserves. Each Borrower agrees (a) to keep
proper books of record and account in which full and correct entries will be
made of all dealings or transactions in relation to its business and affairs,
(b) to set up on its books proper reserves with respect to all taxes,
assessments, charges, levies and claims referred to in Section 3.7; and (c) to
set up on its books from its earnings reserves against, or appropriate write-
offs of, doubtful accounts receivable, advances and securities which are proper
for businesses of the type conducted by it or required by generally accepted
accounting principles.
No Borrower will change the accounting methods or procedures used in
maintaining its books of record and account and the financial reports required
by Section 3.3 without the Bank's prior written consent which will not be
unreasonably withheld or delayed if the change has been accepted by Borrower's
public accountants.
Financial Statements, Certificates and Information. Borrowers will
furnish to Bank:
As soon as available and in any event within forty-five (45) days
after the end of the first three (3) fiscal quarters of the Borrowers' fiscal
year, an internally prepared report, certified as to completeness and accuracy
by the President or chief financial officer of the Parent, covering the
operations of the Parent and its Subsidiaries for the period from the beginning
of the fiscal year to the end of such quarter and containing consolidated
statements of earnings and of retained earnings and paid-in surplus for the
period from the beginning of the fiscal year to the end of such quarter,
consolidated statements of changes in financial condition, and a consolidated
balance sheet and income statement from the beginning of the fiscal year to the
end of such quarter, all such statements shall be in comparative form with the
corresponding period of the next preceding fiscal year.
As soon as available and in any event within forty-five (45) days
after the end of the first three (3) fiscal quarters, and within ninety (90)
days after the end of the last fiscal quarter, of the Borrowers' fiscal year, a
Covenant Compliance Certificate (the "Compliance Certificate"), demonstrating
compliance with the Financial Covenants set forth in Section 3.15 and executed
by the President or chief financial officer of the Parent.
As soon as available and in any event within ninety (90) days
after the last day of each fiscal year, a complete audit report, certified by an
independent public accountant of recognized standing selected by Parent and
satisfactory to Bank, covering the operations of Parent and its Subsidiaries for
such fiscal year and containing consolidated statements of earnings and of
retained earnings and paid-in surplus of the Parent and its Subsidiaries for
such year, consolidated statements of changes in financial condition of the
Parent and its Subsidiaries, and consolidated balance sheets and income
statements of the Parent and its Subsidiaries as at the close of such year, each
accompanied by (i) statements in comparative form for the preceding fiscal year,
(ii) all appropriate schedules and disclosures, (iii) a management letter issued
to Parent by the certified public accountant concerning the audit report and
verification as to the existence of proper financial controls concerning the
operations of Parent and its Subsidiaries or a letter
<PAGE>
from such certified public accountant that such a management letter is not
deemed necessary, and (iv) a certification of Parents' President or chief
financial officer that such audit report fairly represents the financial
condition of Parent and its Subsidiaries at the end of such period and the
results of operations during such period.
Promptly after sending or making available or filing of the same,
copies of all reports, proxy statements, and financial statements that any
Borrower sends or makes available to its stockholders and all registration
statements and reports that any Borrower files with the U. S. Securities and
Exchange Commission or with any comparable department of any foreign country.
Such additional information as Bank reasonably requires
concerning Borrowers and their Subsidiaries.
Right of Inspection. Any qualified representative or agent of Bank
designated for the purpose in writing by Bank has the right to visit and inspect
the facilities, assets and any offices of Borrowers and their Subsidiaries and
to examine all phases of their business and records, to request and receive from
the officers of Borrowers and their accountants complete audit reports and
certificates satisfying all of the requirements of Section 3.3, and to discuss
the same with and be advised as to the same by its officers and its independent
certified public accountants, all at such reasonable times and upon reasonable
notice and as often as Bank may reasonably desire, all at Bank's expense,
provided that after the occurrence and during the continuation of an Event of
Default the Bank's reasonable out-of-pocket expenses for such inspection shall
be at Borrower's expense; provided that any confidential information derived
from Borrowers will not be disclosed by Bank to unauthorized Persons.
Limitation on Sales, Transfers, Consolidation, Mergers, Etc. The
Borrowers will not and will not cause, suffer or permit any Subsidiary to,
without obtaining the prior written consent of Bank which consent shall not be
unreasonably withheld, sell, transfer, or lease all or any material part of its
assets (other than the sale of inventory, equipment and intangibles in the
ordinary course of business) to, or consolidate with, or merge into, any Person,
except for a merger of a Subsidiary into the Parent if the Parent is the
surviving entity or a merger of a Subsidiary into another Subsidiary and except
for the currently planned joint venture in a Korean business.
Maintenance of Business and Existence, Etc. Each Borrower will, and
will cause each of its Subsidiaries to, (a) conduct continuously and operate
actively its business as presently conducted, (b) keep in full force and effect
its legal existence rights and franchises, (c) comply with all Legal
Requirements governing the conduct of its business in all material respects, and
(d) make all reports, pay all taxes and license fees and take all other action
required to maintain its material rights, licenses, leases, powers and
franchises under all applicable federal, state and provincial laws.
Payment of Taxes. Each Borrower will, and will cause each Subsidiary
to, pay promptly all material taxes, assessments and governmental charges
imposed upon it or upon its
<PAGE>
income or profits or upon any property belonging to it. No Borrower nor any
Subsidiary is required to pay any tax, assessment or charge if (a) it is not at
the time due or can be paid later without material penalty, or (b) its validity
is currently being contested in good faith by appropriate proceedings, and (c)
the Borrower or Subsidiary, as the case may be, has set aside on its books
reserves deemed by it adequate with respect to the tax, assessment or charge,
and (d) in any case involving a contested payment due from it in excess of
$100,000, the Borrower or Subsidiary, as the case may be, gives notice in
writing of its action to Bank. Each such Borrower or Subsidiary, as the case may
be, will pay such tax, assessment or charge immediately upon the commencement of
proceedings to foreclose any liens securing it or upon institution of distraint
proceedings, unless payment previously has been secured by the posting of an
appropriate bond or similar surety device.
Limitation on Business with Affiliates, Etc. No Borrower will, nor
will it cause, suffer or permit any Subsidiary to, enter into any transaction
with an Affiliate except on terms no less favorable to such Borrower or
Subsidiary, as the case may be, than would be usual and customary in similar
transactions between Persons not affiliated with each other.
Permitted Indebtedness. The Borrowers will not, and will not cause,
suffer or permit any Subsidiary to, create, assume, incur, or in any manner
become liable for any Indebtedness other than (a) the Revolving Loan, (b)
Indebtedness from vendors incurred in the ordinary course of business, (c)
Capital Leases and purchase money financings of equipment outstanding on the
date of this Agreement or which hereafter occur in the ordinary course of
business as permitted by Section 3.15.4, (d) Indebtedness of a Subsidiary to the
Parent or the Parent to a Subsidiary or a wholly-owned Subsidiary, (e)
guarantees by a Borrower or Subsidiary of loans by other Persons to its
employees, provided that the aggregate principal amount of all such loans at any
time outstanding so guaranteed by Borrowers and their subsidiaries does not
exceed $250,000, (f) Indebtedness outstanding on the date of this Agreement and
set forth in the financial statements furnished to Bank and any renewals,
extensions or refinancings thereof, (g) Indebtedness to CoreStates Bank, N.A.
under the foreign exchange facility agreement, (h) Indebtedness under or in
respect of currency exchange contracts or interest rate protection obligations
incurred in the ordinary course of business, (i) Indebtedness in connection with
performance bonds or letters of credit obtained and issued in the ordinary
course of business, including letters of credit related to insurance associated
with claims for work-related injuries, (j) Indebtedness, the payment of which is
subordinated to the payment of the Revolving Loan and other Obligations
hereunder in a manner reasonably satisfactory to Bank, (k) other unsecured
Indebtedness of the Borrower in an aggregate principal amount at any time
outstanding not to exceed $1,000,000, and (l) indebtedness to CoreStates Bank,
N.A. under the Master Short Term Foreign Currency Borrowing Agreement dated as
of the date hereof.
Limitation on Loans and Advances. The Borrowers will not, and will not
cause, suffer or permit any Subsidiary to, make any loan or advance to any
Person, other than (a) loans or advances to an officer, stockholder, director or
employee of a Borrower or Subsidiary as set forth on Schedule 3.10, (b)
customary employee advances for business travel, (c) loans for employee health
emergencies and (d) Indebtedness referred to in clause (d) of Section 3.9.
<PAGE>
Limitation on Dividends and Distributions. Borrowers will not and
will not cause, suffer or permit any Subsidiary to, (a) without the prior
written consent of Bank, declare or pay any dividends on any class of its
capital stock (except dividends on its common stock payable solely in its common
stock), (b) directly or indirectly purchase, redeem or retire any of its capital
stock, or (c) make any other distribution of any kind or character in respect of
any of its capital stock, except that the Parent may repurchase stock from
employees of the Borrowers under presently existing agreements.
Investments. Borrowers will not, and will not cause, suffer or permit
any Subsidiary to, make any investment (whether by way of stock or other
security, purchase, loan, advance, capital contribution or otherwise) in any
Person, if the aggregate amount of all such investments at any time outstanding
so made by the Borrowers and their Subsidiaries exceeds $1,000,000; provided,
however, that the foregoing limitation shall not apply to (a) investments in a
Wholly-Owned Subsidiary, (b) loans and advances permitted by Section 3.10, (c)
investments in direct obligations of the United States Government or its
agencies or negotiable certificates of deposit of banks having a combined
capital and surplus of at least $25,000,000, none of which shall have maturities
in excess of 12 months, and (d) investments in open market commercial paper
which, at all times after its acquisition, has the highest credit rating
obtainable from either Standard & Poor's Corporation or Moody's Investors
Service, Inc., and a maturity not in excess of 270 days from its acquisition.
Insurance. The Borrowers agree to and to cause each Subsidiary to (a)
keep all its insurable properties insured against such risks as are usually
insured against by Persons engaged in the same or a similar business in the same
jurisdiction; (b) maintain public liability insurance against claims for
personal injury, death or property damage, suffered by others upon or in or
about any premises occupied by it or occurring as a result of its maintenance or
operation of any automobiles, trucks or other vehicles or other facilities; (c)
maintain all such worker's compensation or similar insurance as may be required
under the laws of any state or jurisdiction (domestic of foreign) in which it
may be engaged in business.
All insurance for which provision has been made in clauses (a) and (b) of
this Section: (i) shall be effected under a valid and enforceable policy or
policies issued by insurers of recognized responsibility, except that a Borrower
or a Subsidiary may effect worker's compensation or similar insurance in respect
of operations in any state or other jurisdiction either through an insurance
fund operated by the state or other jurisdiction or by causing to be maintained
a system or systems of self-insurance which is in accord with applicable laws.
Deposit Accounts. Until the Revolving Loan is paid in full, the Bank
will be Parent's principal bank of deposit for their corporate accounts and cash
manager.
Financial Covenants. During the term of this Agreement, Borrowers
will not cause, suffer, or permit:
Leverage Ratio. The ratio of Consolidated Total Liabilities to
Consolidated Tangible Net Worth to be greater than 0.5 to 1.0.
<PAGE>
Minimum Tangible Net Worth. The Consolidated Tangible Net Worth
to be less than $40,000,000.
Current Ratio. The ratio of Consolidated Current Assets to
Consolidated Current Liabilities to be less than 3.25 to 1.0.
Capital Expenditures. The aggregate capital expenditures,
exclusive of assets acquired under Capital Leases and purchase money financing,
of the Borrowers and their Subsidiaries to exceed $7,000,000 in any fiscal year,
or the aggregate fair market value of assets acquired by the Borrowers and their
Subsidiaries under Capital Leases and purchase money financing in any fiscal
year to exceed $1,000,000.
EBITDA Ratio. The ratio of Consolidated EBITDA for any 12-month
period ending coincident with the end of each fiscal quarter of the Borrowers to
the aggregate of the principal and interest payments on all Indebtedness and
Capital Lease payments required to be paid by the Borrowers and their
Subsidiaries during such period to be less than 4.0 to 1.0.
Losses. The Consolidated Net Income for any two consecutive
quarterly fiscal periods to be a negative amount.
Test of Compliance. Compliance with the provisions of this
Section 3.15 will be based on Borrowers' financial statements and tested
quarterly. The Covenant Compliance Certificate described in Section 3.3.2 will
be used to determine compliance with this Section.
ERISA Compliance. The Borrowers will not and will not cause, suffer
or permit any Subsidiary or any employee benefit plan (as defined in Section 3
of ERISA) of the Borrowers or any Subsidiary to (a) engage in any "prohibited
transaction" or incur any "accumulated funding deficiencies" as those terms are
defined in sections 302, 406, 1013 and 2003(a) of ERISA, (b) terminate any
pension plan (as defined in Section 3 of ERISA) in a manner which could result
in the imposition of a lien on its assets pursuant to section 4068 of ERISA or
in a material liability of the Borrowers or the Subsidiary to participants,
beneficiaries or the Pension Benefit Guaranty Corporation or (c) fail to make
payment when due of all amounts which, under the provisions of any pension plan
(as defined in Section 3 of ERISA) which it is required to pay as contributions
thereto.
Environmental Matters. (a) Except as disclosed on Schedule 3.17,
neither the Borrowers nor any Subsidiary has ever owned, occupied or operated a
site or vessel on which any hazardous material or oil was or is stored without
compliance with all statutes, regulations, ordinances, directives and orders of
every federal, state, municipal and other governmental authority with
jurisdiction relative thereto, or disposed of, transported, or arranged for the
transport of any hazardous material or oil without compliance with all such
statutes, regulations, ordinances, directives and orders, or caused or been
legally responsible for any release of any hazardous material or oil; (b) the
Borrowers will not, and will not cause, suffer or permit any Subsidiary, to
dispose of any hazardous material or oil on any site or vessel owned, occupied
or
<PAGE>
operated by it, nor transport or arrange for the transport of, any hazardous
material or oil except if such storage or transport is in the ordinary course of
its business; or (c) the Borrowers and all of the Subsidiaries are now in
compliance with all such statutes, regulations, ordinances, directives and
orders and in the event that the Bank has a reasonable basis to believe that
there has been noncompliance will in the future take all such action (including,
without limitation, engineering tests) as Bank may from time to time reasonably
require to confirm that there has been no release of any hazardous material or
oil on any site or vessel owned, occupied or operated by any Borrower or
Subsidiary; and (d) the Borrowers will indemnify and hold the Bank harmless from
all loss, cost or expense (including reasonable attorneys' fees and expenses)
suffered by the Bank as a result of any claim brought against the Bank by any
governmental agency or authority or any other person on account of the release
of hazardous materials or oil on or from any site or vessel owned, occupied or
operated by the Borrowers or any Subsidiary, or the failure by the Borrowers or
any Subsidiary to comply with any environmental, health safety or sanitation
law, code, ordinance, rule or regulation (each of which may be defended,
compromised, settled or pursued by the Bank with counsel of the Bank's
selection, but at the expense of the Borrowers). Such indemnification shall
survive payment of the Obligations. As used herein, the terms "site," "vessel"
and "hazardous material" shall have the meanings given to such terms in Chapter
21E of the General Laws of Massachusetts.
Compliance with Laws, etc. The Borrowers will, and will cause each
Subsidiary to, comply with all applicable laws, rules, regulations and orders,
and duly observe all valid requirements of governmental authorities (including,
without limitation, ERISA and the rules and regulations thereunder), and all
applicable statutes, rules, regulations and orders relating to environmental
protection and to public and employee health and safety if the failure to so
comply would have a material and adverse effect on Borrower.
Commitment Fee. Commencing on July 1, 1996 and on the first day
following the end of each fiscal quarter thereafter of Borrowers, Borrowers will
pay a commitment fee on the average unused balance of the Revolving Loan for the
preceding fiscal quarter, except as otherwise provided in Section 3.25, at an
annualized rate of one-quarter of one percent (0.25%).
Agent's Fee. Commencing on July 1, 1996 and on the first day
following the end of each fiscal quarter thereafter of Borrowers, Borrowers will
pay, except as otherwise provided in Section 3.25, one quarter of an annual
agency fee of one-eighth of one percent (0.125%) of the Revolving Loan, each
such quarterly payment being $4,687.50.
Other Fees. Borrowers covenant and agree to pay the Issuing Bank's
normal and customary fees in connection with any Letters of Credit issued by or
on behalf of the Issuing Bank under this Agreement.
Negative Covenants. Each Borrower further covenants and agrees that,
so long as any Obligations remain outstanding, it will and will cause each of
its Subsidiaries to comply at all times with the following negative covenants to
the extent applicable, unless the Bank shall otherwise have agreed in writing:
<PAGE>
The Borrowers will not enter into any reorganization or recapitalization or
otherwise reclassify its capital stock;
The Borrowers will not, and will not cause, suffer or permit any Subsidiary
to, sell or otherwise dispose of, or for any reason cease operating, any of
their respective divisions, franchises, or lines of business;
The Borrowers will not, and will not cause, suffer or permit any Subsidiary
to, mortgage, pledge, grant, or permit to exist a security interest in, or a
lien upon any of their respective assets of any kind, now owned or hereafter
acquired except for (i) purchase money security interests which are granted to
secure the purchase price of assets, provided any such security interest is
limited to the specific assets acquired and the proceeds thereof, (ii) liens for
taxes, assessments, statutory obligations or similar charges, incurred in the
ordinary course of business, that are not yet due and payable or if overdue are
being contested in good faith by appropriate and lawful proceedings, so long as
levy and execution thereon have been stayed and continue to be stayed and they
do not, in the aggregate, materially detract from the value of the property or
materially impair the use thereof in the operation of the business of the
Borrower or the Subsidiary, as the case may be, and for which adequate reserves
have been established, (iii) those imposed by law, such as carriers',
warehousemen's and mechanics' liens, bankers' set-off rights and other similar
liens arising in the ordinary course of business for sums not yet due or being
contested in good faith by appropriate proceedings diligently conducted and for
which proper reserves or other provision has been made in accordance with GAAP,
(iv) those arising in the ordinary course of business out of pledges or deposits
under worker's compensation laws, unemployment insurance, old age pensions, or
other social security or retirement benefits, or similar legislation, (v) those
arising from or upon any judgment or award, provided that such judgment or award
is being contested in good faith by proper appeal proceedings, such judgment or
award is not secured by any lien which is not discharged within thirty (30)
days, and only so long as execution thereon shall be stayed, (vi) deposits to
secure the performance of bids, trade contracts, and bonds, performance bonds
and other obligations of a like nature incurred in the ordinary course of any of
the Borrower's businesses, (vii) easements, rights of way, restrictions and
other similar encumbrances incurred in the ordinary course of business which, in
the aggregate, are not material in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of business by the Borrower, (viii) security interests
and liens existing on the date hereof and set forth on Schedule 4.8 hereto, and
(ix) those arising with respect to Capital Leases permitted under Section 3.9;
The Borrowers will not, and will not cause, suffer or permit any Subsidiary
to, enter into any sales-leaseback transactions.
Expenses. Borrowers agree to pay all of the Bank's and Issuing Bank's
reasonable legal fees and expenses for the preparation and examination of the
Loan Documents.
Notice of Failure to Comply with Agreement. Borrowers will notify Bank
immediately in writing of any failure to comply with Borrowers' agreements,
representations and warranties contained in this Agreement describing the
failure in reasonable detail. The written
<PAGE>
notification will be signed by the President or chief financial officer of
Parent. So long as no notice is given, a continuing representation shall be in
effect that no failure exists, and Bank will be entitled to rely upon that
continuing representation.
Effect of Loan Reduction. If Borrower shall advise Bank in writing at
anytime or from time to time that it is reducing the amount of the Loan, an
appropriate adjustment shall be made prospectively in the fees required to be
paid under Sections 3.19 and 3.20.
SECTION
REPRESENTATIONS AND WARRANTIES OF BORROWERS
Borrowers jointly and severally represent and warrant to Bank, and the
representations and warranties are continuing representations so long as any
Obligations remain outstanding and will be deemed repeated and confirmed at the
time of each request for an advance under the Revolving Loan, as follows:
Business, Etc. Each Borrower is a corporation organized, existing and
in good standing under the laws of the state, province or country of its
incorporation as set forth on Schedule 4.1 and is registered to do business as a
foreign corporation in each state, province and country where the failure to so
register would have a material and adverse effect on Borrower. Each Borrower has
adequate corporate power to carry on its business, and is authorized and has all
necessary licenses, franchises and permits material to its business and is
entitled to own its property and to carry on its business, all as and in the
places where its property is now owned or operated and its business is
conducted. Borrowers have no Subsidiaries except as disclosed on Schedule 4.1.
Capitalization. Schedule 4.2 sets forth the capitalization of each of
the Borrowers.
Litigation. There are no actions, suits or proceedings pending, or to
the knowledge of the Borrowers, threatened against or affecting any Borrower or
its property in any court or before or by any Federal, state, provincial,
municipal or other governmental (domestic or foreign) department, commission,
board, bureau, agency or instrumentality which, if adversely determined, would
reasonably be expected to have a material and adverse effect on Borrower, except
those disclosed on Schedule 4.3. No Borrower is in material default with respect
to any material order, writ, injunction, decree or demand of any court or
Federal, state, provincial, municipal or other governmental (domestic or
foreign) department, commission, board, bureau, agency or instrumentality which,
if not timely cured, would reasonably be expected to have a material adverse
effect on Borrower.
Capacity. Each Borrower is authorized under all applicable laws to
make and perform the Loan Documents, and all action on its part required for the
making and performance of the Loan Documents has been taken. Each of the Loan
Documents to which the Borrowers
<PAGE>
are parties is the valid and enforceable obligation of Borrowers in accordance
with its respective terms, subject to laws of general application affecting
creditors rights. Neither the execution and delivery of the Loan Documents, nor
compliance with the terms thereof, will conflict with or result in a breach of
any provisions of certificate of incorporation or other charter documents of any
of the Borrowers or a material breach under any material agreement to which any
Borrower is now a party or by which it is bound, or constitute a material
default under any of the foregoing, or result in the creation of any material
encumbrance upon any property of any Borrower under the terms of any such
agreement.
Disclosure. None of the Loan Documents and no certificate or written
statement furnished to Bank by Borrowers, including without limitation the
financial statements of the Borrowers contained in the Form 10-Q for the quarter
ended March 31, 1996, in connection with the transactions contemplated under the
Loan Documents, contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained
therein not misleading; provided, however, that the foregoing is qualified to
the best of Borrowers' knowledge with regard to documents provided to Borrowers
by a third party.
Use of Proceeds. The proceeds of the Revolving Loan are to be used
for working capital and for the purposes contemplated by Sections 2.4 and 2.5.
No part of the proceeds of the Revolving Loan will be used for the purpose of
purchasing or carrying any "margin security" as defined in Regulation U of the
Board of Governors of the Federal Reserve System.
Taxes. Borrowers have filed all required tax returns and paid all
applicable Federal, state, provincial, local and foreign taxes, other than (a)
taxes not yet due or which may be paid in the future without penalty and (b)
taxes which are currently being contested in good faith by appropriate
proceedings and for which Borrowers have established adequate reserves.
Borrowers have no knowledge of any deficiency or additional assessment in
connection with any taxes not provided for on its books.
Title to Assets. The Borrowers have good and marketable title to all
of their respective assets, none of which is subject to any security interest,
encumbrance, lien, or claim of any Person, except as permitted under Section
3.22 or disclosed on Schedule 4.8.
Employee Benefits Plans.
No "reportable event" (as defined in Section 4043(b) of ERISA)
(whether or not waived) has occurred or is continuing with respect to any
"employee pension benefit plan" (as defined in Section 3 of ERISA) maintained
for employees of the Borrowers or any Subsidiary located in the United States (a
"Pension Benefit Plan").
Except as otherwise disclosed on Schedule 4.9 hereto, no
prohibited transaction (within the meaning of Section 406 of ERISA) has occurred
with respect to any Pension Benefit Plan or any other "employee benefit plan"
(as defined in Section 3 of ERISA) (together with a Pension Benefit Plan, an
"Employee Plan") maintained for employees of the Borrowers or any Subsidiary and
covered by Part 4 of the Subtitle B of Title I of ERISA.
<PAGE>
With respect to each Pension Benefit Plan, the amount for which
the Borrowers or any Subsidiary would be liable pursuant to the provisions of
Sections 4062, 4063 or 4064 of ERISA would be zero if such Plans terminated on
the date of this Agreement. As reflected on the audited balance sheet of
Borrowers and Subsidiaries contained in the Form 10-K for the fiscal year ended
September 30, 1995, the accumulated benefit obligation under all defined benefit
plans of the Borrowers and Subsidiaries was less than the fair value of the
assets of those plans.
Neither the Borrowers nor any Subsidiary is now, or has been
during the preceding five years, a contributing employer to a "multiemployer
plan" (as defined in Section 4001(a)(3) of ERISA) (a "Multiemployer Plan").
Neither the Borrowers nor any Subsidiary has (a) ceased operations at a facility
so as to become subject to the provisions of Section 4062(f) of ERISA, (b)
withdrawn as a substantial employer so as to become subject to the provisions of
Section 4063 of ERISA, (c) ceased making contributions on or before the date
hereof to any Pension Benefit Plan subject to the provisions of Section 4064(a)
of ERISA to which the Borrowers or any Subsidiary, as the case may be, made
contributions during any of the five years prior to the date hereof, (d)
incurred or caused to occur a "complete withdrawal" (within the meaning of
Section 4203 of ERISA) or a "partial withdrawal" (within the meaning of Section
4205 of ERISA) from a Multiemployer Plan that is a Pension Benefit Plan so as to
incur withdrawal liability under Section 4201 of ERISA (without regard to
subsequent reduction or waiver of such liability under Sections 4207 or 4208 of
ERISA), or (e) been a party to any transaction or agreement under which the
provisions of Section 4204 of ERISA were applicable.
No notice of intent to terminate a Pension Benefit Plan has been
filed, nor has any Plan been terminated, pursuant to the provisions of Section
4041(f) of ERISA.
The Pension Benefit Guaranty Corporation has not instituted
proceedings to terminate (or appoint a trustee to administer) a Pension Benefit
Plan and no event has occurred or condition exists which might constitute
grounds under the provisions of Section 4042 of ERISA for the termination of (or
the appointment of a trustee to administer) any such Plan.
Neither the Borrowers nor any Subsidiary maintains or has ever
maintained any Pension Benefit Plan that is subject to the provisions of Title
I, Subtitle B, Part 3 of ERISA.
There are no actions, suits or claims pending (other than routine
claims for benefits) or, to the knowledge of the Borrowers, which could
reasonably be expected to be asserted, against any Employee Plan or the assets
of any such plan. No civil or criminal action brought pursuant to the provisions
of Title I, Subtitle B, Part 5 of ERISA is pending or, to the best of the
Borrowers' knowledge, threatened against any fiduciary of any Employee Plan.
None of the Employee Plans or any fiduciary thereof has been the direct or
indirect subject of an audit, investigation or examination by any governmental
or quasi-governmental agency.
All of the Employee Plans comply currently, and have complied in
the past, in all material respects both as to form and operation, with their
terms and with the provisions of
<PAGE>
ERISA and the Internal Revenue Code of 1986, and all other applicable laws,
rules and regulations (including, but not limited to, the Tax Reform Act of 1986
and all subsequent Federal legislation affecting qualified plans generally); all
necessary governmental approvals for the Employee Plans have been obtained and a
favorable determination as to the qualification under Section 401(a) of the Code
of each of the Pension Benefit Plans and each amendment thereto has been made by
the Internal Revenue Service and a recognition of exemption from federal income
taxation under Section 510(a) of the Code of each of the funded welfare benefit
plans within the meaning of Section 3(1) of ERISA has been made by the Internal
Revenue Service, and nothing has occurred since the date of each such
determination or recognition letter that would adversely affect such
qualification.
For purposes of all sections of this Agreement dealing with
ERISA, the terms "Borrowers" and "Subsidiary" shall mean and include each
Borrower and each Subsidiary and each trade or business (whether or not
incorporated) which together with any Borrower or Subsidiary, as the case may
be, would be treated as a single employer under the provisions of Title I or IV
of ERISA.
SECTION
DEFAULTS; EVENTS OF DEFAULT
Default Defined. The following will (i) if any requirement for notice
or lapse of time or both has not been met, constitute Defaults, and (ii) if
there are no such requirements or if such requirements have been met, constitute
Events of Default:
The failure to pay any principal of the Revolving Loan when it
becomes due and such failure continues for five (5) days;
The failure to pay any interest on the Revolving Loan when it
becomes due and such failure continues for five (5) days;
If (a) there is a failure to pay principal or interest of any
Obligations, other than the Revolving Loan, which continues beyond any
applicable period of grace, or (b) there is a failure, other than in the payment
of money and other than a failure referred to in Section 5.1.4, to perform or
observe any Obligations which continues beyond any applicable period of grace,
or (c) any statement, certificate, report, financial statement, representation
or warranty made or furnished by Borrowers in this Agreement or in connection
with the Loan Documents or in compliance with the provisions of the Loan
Documents proves to have been false or erroneous in any material respect;
If there is a failure to perform or observe the covenants set
forth in Sections 3.6, 3.7, 3.8, 3.10, 3.12, 3.13 or 3.17 which continues for
thirty (30) days;
<PAGE>
If there is a failure to pay or perform any obligation, other
than an Obligation, to an Issuing Bank, which continues beyond any applicable
period of grace.
If any Borrower (a) terminates its existence; (b) is or becomes
insolvent within the meaning of the Massachusetts Uniform Commercial Code; (c)
files a petition in bankruptcy or a petition to take advantage of any insolvency
act; (d) makes an assignment for the benefit of its creditors; (e) consents to
the appointment of a receiver or custodian of itself or of the whole or any
substantial part of its property; (f) is named debtor party in an involuntary
bankruptcy proceeding which is not vacated or set aside within sixty (60) days;
or (g) files a petition or answer seeking reorganization or arrangement under
any Federal or state law;
If a court of competent jurisdiction enters an order (a)
appointing, without consent of Borrower, a receiver or custodian of any Borrower
or of the whole or any substantial part of any Borrower's property, or (b)
approving a petition filed against any Borrower seeking reorganization or
arrangement of a Borrower under any Federal, state, provincial or foreign law,
and such order is not vacated or set aside or stayed within forty-five (45) days
after it is entered;
If, under the provisions of any law for the relief or aid of
debtors, any court of competent jurisdiction assumes custody or control of any
Borrower or of the whole or any substantial part of any Borrower's property, and
such custody or control is not terminated or stayed within forty-five (45) days
after the date of assumption of such custody or control;
If final judgment for the payment of money in excess of $150,000
is entered by any court against any Borrower, and within thirty (30) days after
entry of the judgment such Borrower does not (a) discharge the judgment or
provide for its discharge in accordance with its terms, or (b) procure a stay of
execution and within said period of thirty (30) days, or such longer period
during which execution of the judgment has been stayed, appeal and cause the
execution to be stayed during the appeal;
Any failure by any Borrower (a) to pay when due the principal of,
or interest or premium on, any Indebtedness (other than the Revolving Loan)
incurred or assumed by any Borrower for money borrowed or for the acquisition of
property in an amount in excess of $150,000 or (b) to perform or observe any of
the obligations which are imposed on such Borrower by any agreements securing or
evidencing such Indebtedness or under which such Indebtedness is issued, and in
either case such failure is not cured within any applicable period of grace or
being contested by Borrower in good faith and in appropriate proceedings; and
5.1.11 Failure of the Borrower to deliver to Bank within six (6)
months of the date of this Agreement an opinion from Borrower's counsel in form
and substance reasonably acceptable to Bank and its counsel to the effect that
Brooks Automation of Canada is a corporation duly organized, validly existing
and in good standing under the laws of the Province of British Columbia, Canada,
and that it has adequate corporate power and authority to own its property and
to conduct its business as presently conducted, Brooks Automation KK is a stock
corporation duly organized, validly existing and in good standing under the laws
of Japan and that it has adequate power to own its property and conduct its
business as presently
<PAGE>
conducted, (c) each of Brooks Automation of Canada and Brooks Automation
Massachusetts Securities Corp. has full corporate power and authority to enter
into the Loan Documents, and the Loan Documents have been duly authorized by
each of them, have been duly executed and delivered by their respective
authorized officers, and are the legal, valid and binding obligations of each of
them, enforceable in accordance with their terms, subject to laws of general
application affecting the rights and remedies of creditors and (d) as to the
absence of meaningful litigation, claims, etc. affecting Brooks Automation of
Canada and Brooks Automation K.K., it being understood that the Bank will accept
an opinion as to the due organization and corporate authority of Brooks
Automation K.K. which is comparable to that which Japanese banks typically
accept in $15,000,000 loan transactions.
Effect of Default. If a Default occurs, Borrower's right to request
Advances under the Revolving Loan will terminate immediately and without notice,
and Bank may, to the extent permitted by law and without notice.
Enforcement. If any Event of Default has occurred and is continuing,
the Bank may, to the extent permitted by law and without notice to Borrowers,
declare the principal of and all interest on the Revolving Loan to be
immediately due and payable, the Bank may proceed to protect and enforce its
rights either by suit in equity and/or by action at law, whether for the
specific performance of any covenant or agreement contained in this Agreement or
any of the Loan Documents, or proceed to enforce the payment of the Revolving
Loan or to enforce other legal or equitable rights of Bank pursuant to the Loan
Documents, and the Issuing Bank shall have the right to close-out and liquidate
the foreign exchange contracts executed in accordance with Section 2.5 as
provided in the foreign exchange facility agreement referred to in Section 2.5.
SECTION
MISCELLANEOUS
Remedies Cumulative: Remedies not Waived. No remedy conferred on Bank
is intended to be exclusive of any other remedy and each remedy is cumulative
and in addition to every other remedy given under this Agreement or now or in
the future existing at law or in equity or by statute. No course of dealing
between Borrowers and Bank nor any delay on the part of Bank in exercising any
rights under this Agreement will operate as a waiver of any of Bank's rights.
Right of Set-off. As security for the payment and performance of the
Obligations, each Borrower grants to Bank a security interest in all deposits
and other sums credited by or due such Borrower from Bank. Regardless of the
adequacy of any other collateral, if an Event of Default has occurred and is
continuing, any deposits or other sums credited by or due from Bank to any
Borrower, be set off and applied by Bank against any of the Obligations in such
manner as Bank in its discretion may determine. In addition, each Borrower
agrees that Bank has the rights
<PAGE>
of a secured party under the Uniform Commercial Code with respect to all of its
deposits at the Bank.
Survival of Agreements, Parties in Interest, Etc. All agreements,
representations and warranties made by Borrowers in the Loan Documents or in any
other document delivered to Bank in connection with the Loan Documents by or on
behalf of Borrowers, will survive the execution and delivery of the Loan
Documents to Bank. All statements contained in any document delivered by or on
behalf of any Borrower in connection with the Loan Documents or the transactions
contemplated by this Agreement constitute representations and warranties by such
Borrower. All the terms, representations and warranties in this Agreement are
binding upon and inure to the benefit of and are enforceable by and against the
respective successors and assigns of the parties to this Agreement whether so
expressed or not.
Notices, Etc. All notices, demands and other communications under
this Agreement must be in writing and be delivered in hand or sent by courier,
express mail, or first-class mail, postage prepaid, addressed to the parties,
respectively, as follows:
If to Borrowers to:
Brooks Automation, Inc.
15 Elizabeth Drive
Chelmsford, MA 01824
Attn: Stanley D. Piekos, Chief Financial Officer
If to Bank:
USTrust
31 Court Street
Boston, Massachusetts 02108
ATTN: Robert L. Whitmore, Vice President
Either party may designate another address to which communications are to
be sent or another Person to receive copies of communications. Any
communication will become effective only when received by the Person to whom it
is given. However, if it is mailed by first-class registered or certified mail,
it will be deemed to be received on the earlier of (i) the third business day
after it is mailed, or (ii) the day it is actually received.
Governing Law. The Loan Documents are each contracts made under and
to be construed according to the laws of the Commonwealth of Massachusetts where
they were executed by Borrowers and delivered to the Bank. Borrowers and Bank
agree that all actions or proceedings in any way arising out of or related to
the Loan Documents or the transactions contemplated under the Loan Documents
will be litigated in courts located in the Commonwealth of Massachusetts.
<PAGE>
6.6 Severability. If any provision of this Agreement shall be held
invalid under any applicable Laws, such invalidity shall not affect any other
provision of this Agreement that can be given effect without the invalid
provision, and, to this end, the provisions hereof are severable.
6.7 Counterparts. This Agreement may be executed in several counterparts,
and each executed copy constitutes an original instrument but the counterparts
together constitute but one and the same instrument.
6.8 Headings. The headings of the several sections, divisions or
subsections of this Agreement are not to be construed to constitute any part of
this Agreement.
6.9 Consent to Jurisdiction; Waivers. BORROWER HEREBY IRREVOCABLY AND
UNCONDITIONALLY (A) SUBMITS TO PERSONAL JURISDICTION IN THE COMMONWEALTH OF
MASSACHUSETTS OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, AND (B) WAIVES ANY AND ALL
PERSONAL RIGHTS UNDER THE LAWS OF THE UNITED STATES AND ANY STATE (I) TO THE
RIGHT, IF ANY, TO TRIAL BY JURY, (II) TO OBJECT TO JURISDICTION WITHIN THE
COMMONWEALTH OF MASSACHUSETTS OR VENUE IN ANY PARTICULAR FORUM WITHIN THE
COMMONWEALTH OF MASSACHUSETTS, AND (III) TO THE RIGHT, IF ANY, TO CLAIM OR
RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES
OTHER THAN ACTUAL DAMAGES.
IN WITNESS WHEREOF, Borrowers have signed this Agreement and Bank has
caused this Agreement to be signed in its behalf, in its corporate name by its
authorized officer, as a sealed instrument all as of the day and year first
above written.
USTRUST BROOKS AUTOMATION, INC.
By: By:
Robert L. Whitmore
Vice President
BROOKS AUTOMATION CANADA CORP.
By:
BROOKS AUTOMATION K.K.
<PAGE>
By:
BROOKS AUTOMATION MASSACHUSETTS
SECURITIES CORP.
By:
BROOKS AUTOMATION LTD
By:
<PAGE>
Exhibit 10.21
MASTER SHORT TERM FOREIGN CURRENCY BORROWING AGREEMENT [LOGO OF
------------------------------------------------------ CORESTATES
BANK]
June 18, 1996
Brooks Automation, Inc.
Brooks Automation Canada Corp.
Brooks Automation K.K.
Brooks Automation Ltd.
Brooks Automation Massachusetts Securities Corp.
15 Elizabeth Drive
Chelmsford, MA 01824
Dear Sirs:
The purpose of this Agreement is to supplement the letter agreement dated
June 18, 1996 ("Letter Agreement") between us, CoreStates Bank N.A. ("Bank") and
you, each of the addressees of this Agreement ("Borrower(s)") to further
describe how the foreign currency loans will be made pursuant to the foreign
currency line of credit described in the Letter Agreement ("Loan(s)"). The
Letter Agreement is attached hereto and incorporated by reference herein. This
Agreement does not constitute a commitment to lend or to make advances. It is
understood and agreed that any and all Loans will be governed by the following:
1. Requests for Loans. From time to time, before the earlier to occur of
------------------
(a) a Default under Section 10 hereof, or (b) December 31, 1997, your duly
authorized officer or other duly authorized person may request Loans by
telephone or by letter. If we agree to make a Loan, then we will credit the
proceeds to your designated account with us. Upon your request we will forward
to you at your address set forth in Paragraph 15 written advices or statements
of Loans, which will specify the rate or rates of interest payable on the Loans,
and such other terms as may have been agreed to.
2. Resolutions Authorizing Loans. Any and all documents required to be
-----------------------------
executed in connection with Loans may be signed by any of the officers or other
persons duly authorized by your borrowing resolutions as in effect from time to
time, provided that a copy of such resolutions is certified by the Secretary or
an Assistant Secretary of your corporation and delivered to us. We shall incur
no liability to you or any other person in acting on any request for a Loan
which we believe in good faith to have been made by a person duly authorized to
borrow on your behalf as set forth in your borrowing resolutions.
<PAGE>
3. Bank Records Conclusive. The terms of each Loan including the rate of
-----------------------
interest thereon and your payments of principal and interest, as well as any
special terms and details of each such Loan, shall be established and evidenced
by this Agreement, the Letter Agreement and by our records, which shall be
conclusively deemed to be correct in the absence of manifest error.
4. Payment of Loans. All Loans shall be payable on a demand, time or
----------------
other basis mutually agreed upon at the time the Loan is made. Loans which are
payable on a basis other than demand are subject to the prepayment penalties
described in the Letter Agreement and may not be prepaid prior to their maturity
date or dates without payment of such penalties, if any. Upon the payment in
whole or in part of any Loan as provided above, accrued and unpaid interest on
the amount repaid shall be simultaneously paid.
5. Interest. (a) Interest on each Loan shall be computed at the
--------
applicable LIBOR rate plus 200 basis points and, with respect to 30, 60 or 90
day, Loans shall be payable upon maturity and, with respect to 180 day Loans,
shall be payable at 90 days and at maturity. The term LIBOR rate shall mean and
refer to LIBOR rate applicable at that time in the country of the foreign
currency which is borrowed.
(b) Each overdue payment of principal on any Loan and, to the extent
permitted by law, each overdue payment of interest shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to 2% in excess of
the current interest rate applicable to that Loan.
(c) Unless otherwise agreed, interest on all Loans shall be computed on
the basis of a year of 360 days for each day of the year actually elapsed.
6. Payments. You irrevocably authorize us to effect payments of principal
--------
of and interest on all Loans whenever such payment is due and to debit your
designated account for the amount of such payment. We shall furnish to you a
written confirmation of the amount of each principal and interest payment
charged against your designated account. You will pay to us promptly such
amounts as may be due if your designated account balance is insufficient. All
payments of principal and interest on Loans shall be made in the currency of the
borrowed funds in immediately available funds free and clear of and without
deduction for any taxes, fees or other charges of any nature imposed by any
governmental authority, or, if such withholding is required, you shall pay to us
the same net amount as if no withholding was made.
7. Payment of Costs. In addition to the principal and interest payments
----------------
specified in paragraphs 4 and 5, you agree to pay upon demand all costs and
expenses (including reasonable attorneys' fees and legal expenses) we incur in
enforcing the Loans and this Agreement.
8. Further Evidence of Loans. Upon our request, you hereby agree to
-------------------------
execute and deliver to us a promissory note or notes payable to our order to
evidence all or any part of any Loans. If any Loan is or shall be evidenced by
one or more promissory notes, such note or notes shall be
-2-
<PAGE>
deemed to incorporate by reference, and to be supplemented and modified by, the
terms of this Agreement.
9. Security. As security for the payment of all sums owed by you to us,
--------
we shall have a lien upon, and security interest in, any balance belonging to
you in any of your deposit or other accounts with us and any other amounts or
property which from time to time may be owing by us to you or held by us for
you.
10. Defaults. The occurrence of any of the following events shall cause
--------
you to be in default on any and all outstanding Loans:
(a) the non-payment when due of any amount payable on any of the
Liabilities and such non-payment continues for five (5) days after such due date
(the term "Liabilities" shall mean all loans and advances made under this
Agreement and any renewals, extensions and modifications thereof and all of your
other existing and future liabilities, whether absolute or contingent, to the
Bank regardless of their source or nature and out of whatever transactions
arising);
(b) the failure of any Obligor to observe or perform any other term of
this Agreement or any other agreement or note with Bank or other lender,
including without limitation the Loan Agreement and related documents dated June
25, 1996, between Borrower and U.S. Trust (the term "Obligor" includes you and
all persons otherwise liable for the payment of all such loans or notes or both
and all renewals, extensions or modifications thereof, such as endorsers or
guarantors);
(c) the entry of any judgment or the issuing of any attachment or
garnishment against any Obligor in an amount in excess of $150,000.
(d) the dissolution, merger, consolidation or reorganization of any
Obligor;
(e) if any information furnished by any Obligor proves to have been
materially false or misleading when made;
(f) the failure of any Obligor to furnish such financial or other
information as we may reasonably request; and
(g) the insolvency of any Obligor, any assignment for the benefit of
creditors of any Obligor or the filing by or against any Obligor of a petition
under any provision of any law or statute alleging insolvency or inability to
pay debts as they mature.
11. Acceleration. If you are in default as described in Paragraph 10(a)
------------
through (f), at our election evidenced by notice in writing to you, all Loans,
whether or not evidenced by a note, shall thereupon become due and payable
without presentment, demand or protest, all of which are hereby waived. If you
are in default as described in Paragraph 10 (g), then forthwith and without any
-3-
<PAGE>
election or notice, all Loans, whether or not evidenced by a note, shall
thereupon become due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived. You waive all right to stay
of execution and exemption of property in any action to enforce your obligations
to us hereunder.
12. Joint and Several Liability. All of the liabilities shall be joint
---------------------------
and several obligations of each of the Borrowers.
13. Continuing Effect. This Agreement shall remain in full force and
-----------------
effect until all Loans outstanding, together with interest thereon, and all
other sums required to be paid under the terms of this Agreement have been paid
in full.
14. Governing Law. This Agreement and any note or notes evidencing Loans
-------------
made shall be construed in accordance with and governed by the laws of
Massachusetts.
15. Bank's Assignees. The Bank may at any time or from time to time grant
----------------
to others assignments of or participations in the Loans.
16. Notices. Any notice given under this Agreement shall be effective on
-------
the date when it is delivered to a party at its address set forth as follows (or
at such other address as the party to which notice may be given may specify to
the other in writing); if to you, at:
Brooks Automation, Inc.
15 Elizabeth Drive
Chelmsford MA 01824
Attn: Stanley D. Piekos, CFO
and if to us, at:
Broad and Chestnut Streets,
Philadelphia, PA 19101
Attn: R. Thomas Esser
F.C. 1-8-4-2
17. Miscellaneous. Any failure by us to exercise any right under this
-------------
Agreement shall not be construed as a waiver of the right to exercise the same
or any other right at any other time. If more than one person, including any
form of legal entity, shall sign this Agreement as borrower, such persons shall
be jointly and severally liable hereunder and the terms "you" and "your" shall
be deemed to mean any and all of such persons. The parties hereto intend this
Agreement to be a sealed instrument and to be legally bound hereby.
-4-
<PAGE>
Please indicate your acceptance of this Agreement by signing and dating
the enclosed copy at the place provided and returning such copy to us.
Very truly yours,
CoreStates Bank, N.A
/s/ R. Thomas Esser
R. Thomas Esser
Vice President
-5-
<PAGE>
Acceptance Of And Agreement To
Master Short Term Foreign Currency Borrowing Agreement
------------------------------------------------------
We, the addressee of the above Master Short Term Borrowing Agreement,
intending to be legally bound, accept and agree to the terms and conditions
of said Agreement and promise to pay the principal of and interest on all Loans
made to us by CoreStates Bank, N.A, and all other sums required to be paid by us
to said Bank, under and in accordance with the terms of said Master Short Term
Borrowing Agreement. Signed this _________________ day of _____________, 19___.
Brooks Automation, Inc Brooks Automation Canada Corp.
/s/ SIGNATURE ILLEGIBLE /s/ SIGNATURE ILLEGIBLE
- ----------------------- ---------------------------
(Borrower) (Borrower)
By ___________________ By ___________________________
___________________ ___________________________
(Name and Title) (Name and Title)
Brooks Automation K.K. Brooks Automation Ltd.
/s/ SIGNATURE ILLEGIBLE /s/ SIGNATURE ILLEGIBLE
- ---------------------- -----------------------------
(Borrower) (Borrower)
By ___________________ By __________________________
___________________ __________________________
(Name and Title) (Name and Title)
-6-
<PAGE>
<PAGE>
BROOKS AUTOMATION MASSACHUSETTS SECURITIES CORP.
/s/ SIGNATURE ILLEGIBLE
- -------------------------------
(Borrower)
By ___________________________
_____________________________
(Name and Title)
[SEAL]
-7-
<PAGE>
[LOGO OF CORESTATES BANK APPEARS HERE]
June 18, 1996
Brooks Automation, Inc.
Brooks Automation Canada Corp.
Brooks Automation K.K.
Brooks Automation Ltd.
Brooks Automation Massachusetts Securities Corp.
15 Elizabeth Drive
Chelmsford, MA 01824
ATTN: Mr. Stanley D. Piekos
Chief Financial Officer
Dear Stan
I am pleased to offer the following line of credit available for working capital
financing in foreign currencies. I understand that this facility is in addition
to the $15 million unsecured revolving credit facility that you have been
offered by U.S. Trust Bank of which CoreStates is a 1/3 participant.
BORROWER(S): Brooks Automation, Inc.
Brooks Automation Canada Corp.
Brooks Automation K.K.
Brooks Automation Ltd.
Brooks Automation Massachusetts Securities Corp.
LENDER: CoreStates Bank N.A.
LOAN TYPE AND AMOUNT: $3,000,000 Unsecured Discretionary Line of Credit in
currencies other than U.S. dollars.
AVAILABILITY: The maximum outstanding under this facility at any one
time shall be the equivalent of $3,000,000 USD in any
foreign currency mutually agreed between the Borrowers
and the Bank.
PURPOSE: Working capital and other short term corporate
purposes.
<PAGE>
Mr. Stanley D. Piekos, Chief Financial Officer
June 18, 1996
Page Two
COLLATERAL: None
INTEREST RATES: LIBOR plus 200 b.p. for maturities of 30, 60, 90 or 180
days.
INTEREST PAYMENTS: In the case of 30, 60 or 90-day loans, at maturity. In
the case of 180-day loans, at the end of 90 days and at
maturity.
MINIMUM LOANS: $250,000 US dollar equivalent
PREPAYMENTS
PROHIBITIONS: LIBOR loans may not be prepaid prior to maturity
without a potential breakage fee depending upon the
interest rate market at the time of prepayment.
REPORTING
REQUIREMENTS: 1. Quarterly, within 45 days after the end of each of
the first three fiscal quarters.
a. Consolidated financial statements prepared
by the Company.
b. Certificate of covenant compliance with all
Bank debt.
2. Within 90 days after the end of each fiscal year.
a. Consolidated financial statements prepared
and certified by an independent certified
public accountant.
b. Certificate of covenant compliance.
c. Principal financial officer and accountant's
statement of no default.
3. Promptly after the filing of the same, copies of
all reports, proxy statements and financial
statements that the Borrower files with the U.S.
Securities and Exchange Commission or any
comparable department in a foreign country.
<PAGE>
Mr. Stanley D. Piekos, Chief Financial Officer
June 18, 1996
Page Three
OTHER CONDITIONS TO
THE LINE OF CREDIT: 1. Execusion of the Master Short Term
Borrowing Agreement, Corporate Borrowing
Resolution and Negative Pledge Agreement
(documents enclosed).
2. Establishment of a corporate checking
account at CoreStates Bank N.A..
If the foregoing is satisfactory, please execute the enclosed documentation
and return to my attention. In order to activate this facility, please sign
and return this documentation.
Very truly yours
/s/ R. Thomas Esser
R. Thomas Esser
Vice President
RTE/dh
AGREED AND ACCEPTED:
BROOKS AUTOMATION, INC.
/s/ SIGNATURE ILLEGIBLE 6/25/96
- --------------------------------- ---------
Name and Title Date
BROOKS AUTOMATION CANADA CORP.
/s/ SIGNATURE ILLEGIBLE 6/25/96
- --------------------------------- ---------
Name and Title Date
<PAGE>
Mr. Stanley D. Piekos, Chief Financial Officer
June 18, 1996
Page Four
AGREED AND ACCEPTED:
BROOKS AUTOMATION K.K.
/s/ SIGNATURE ILLEGIBLE 6/25/96
----------------------- ---------
Name and Title Date
BROOKS AUTOMATION LTD.
/s/ SIGNATURE ILLEGIBLE 6/25/96
----------------------- ---------
Name and Title Date
BROOKS AUTOMATION MASSACHUSETTS SECURITIES CORP.
/s/ SIGNATURE ILLEGIBLE 6/25/96
----------------------- ---------
Name and Title Date
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> JUN-30-1996
<CASH> $4,843
<SECURITIES> 0
<RECEIVABLES> 21,767
<ALLOWANCES> (80)
<INVENTORY> 19,095
<CURRENT-ASSETS> 48,251
<PP&E> 18,391
<DEPRECIATION> 4,560
<TOTAL-ASSETS> 63,063
<CURRENT-LIABILITIES> 14,007
<BONDS> 0
0
0
<COMMON> 75
<OTHER-SE> 48,178
<TOTAL-LIABILITY-AND-EQUITY> 63,063
<SALES> 66,446
<TOTAL-REVENUES> 66,446
<CGS> 38,478
<TOTAL-COSTS> 38,478
<OTHER-EXPENSES> 18,206
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 283
<INCOME-PRETAX> 9,791
<INCOME-TAX> 3,459
<INCOME-CONTINUING> 6,332
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,332
<EPS-PRIMARY> $0.77
<EPS-DILUTED> $0.77
</TABLE>
