As filed with the Securities and Exchange Commission on May 21, 2002
Registration No. 333-85214
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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Pre-Effective Amendment No. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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AXCELIS TECHNOLOGIES, INC.
(Exact name of registrant as specified in charter)
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Delaware 34-1818596
(State or other (I.R.S. Employer
jurisdiction of Identification Number)
incorporation or
organization)
55 Cherry Hill Drive, Beverly, Massachusetts 01915 (978) 787-4000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
-----------------
LYNNETTE C. FALLON
Senior Vice President and General Counsel
Axcelis Technologies, Inc.
55 Cherry Hill Drive
Beverly, Massachusetts 01915
(978) 787-4000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
with copies to:
MATTHEW C. DALLETT
Palmer & Dodge LLP
111 Huntington Avenue
Boston, Massachusetts 02199-7613
(617) 239-0100
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment that specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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SUBJECT TO COMPLETION, DATED MAY 21, 2002
[LOGO]
AXCELIS
Axcelis Technologies, Inc.
$125,000,000 Principal Amount of
4 1/4% Convertible Subordinated Notes Due January 15, 2007
6,250,000 Shares of Common Stock
We issued the notes in a private placement in January 2002. This prospectus
will be used by selling securityholders to resell their notes and the shares of
our common stock issuable upon conversion of their notes. We will not receive
any of the proceeds from the sale of these notes or these shares.
The notes are unsecured subordinated obligations of Axcelis. The notes will
accrue interest at an annual rate of 4 1/4%. We will pay interest on the notes
on January 15 and July 15 of each year, beginning July 15, 2002. On or after
January 19, 2005, we may redeem for cash all or part of the notes that have not
previously been converted or repurchased at an initial redemption price of
101.70% of their principal amount plus accrued and unpaid interest. If we
undergo specific types of fundamental changes that are described in this
prospectus, each holder may require us to redeem all or a portion of such
holder's notes. See "Description Of Notes - Redemption at Option of the Holder."
Unless previously redeemed, holders may surrender their notes for
conversion into shares of our common stock at the conversion price of 50 shares
of common stock per $1,000 principal amount of notes or an effective price of
$20.00 per share (subject to adjustment).
The notes have been designated for trading in The Portal Market, a
subsidiary of The Nasdaq Stock Market, Inc. Any notes that are resold by means
of this prospectus will no longer be eligible for trading in The Portal Market.
Our common stock is quoted on the Nasdaq National Market under the trading
symbol "ACLS," and on May 20, 2002, its closing price was $14.49 per share.
Investing in the notes and shares of our common stock involves a high
degree of risk. You should carefully read and consider the "Risk Factors"
beginning on page 5.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this prospectus is May , 2002.
Axcelis Technologies, Inc. . 55 Cherry Hill Drive, Beverly, Massachusetts 01915
. (978) 787-4000
TABLE OF CONTENTS
Page
----
Note Regarding Forward-Looking Statements 3
Axcelis.................................. 4
Risk Factors............................. 5
Ratio of Earnings to Fixed Charges....... 12
Use of Proceeds.......................... 12
Description of Credit Facility........... 12
Description Of Notes..................... 12
Selling Securityholders.................. 22
Plan of Distribution..................... 25
Legal Matters............................ 26
Experts.................................. 26
Where You Can Find More Information...... 27
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Statements made throughout this prospectus and the documents incorporated
herein by reference about our anticipated financial condition, results of
operations and operating efficiencies, our business strategies, objectives and
competitive positioning, and the market opportunities for existing or future
products are forward-looking statements. You may identify forward-looking
statements by terms such as "estimate," "project," "plan," "intend," "expect,"
"believe," "anticipate," "should," "may," "will" and similar expressions.
These forward-looking statements are based on our current plans and
assumptions, speak only as of the date of this prospectus, and are subject to
many risks and uncertainties. Important information about factors that could
cause our actual results to differ materially from those suggested by the
forward-looking statements is included or referred to under the heading "Risk
Factors" beginning on page 5, as well as in Exhibit 99 to our 2001 Annual
Report on Form 10-K filed with the Securities and Exchange Commission.
Therefore, you should consider any forward-looking statement in light of all
of the information included or referred to in this prospectus. You are
cautioned not to place undue reliance on any forward-looking statement.
3
AXCELIS
We are a leading producer of ion implantation, dry strip, photostabilization
and rapid thermal processing equipment used in the fabrication of
semiconductors in the United States, Europe and Asia Pacific. Semiconductors,
or chips, are used in personal computers, telecommunication equipment, digital
consumer electronics, wireless communication products and other applications.
In addition, we provide extensive aftermarket service and support, including
spare parts, equipment upgrades, maintenance services and customer training. We
have a 50-50 joint venture with Sumitomo Heavy Industries, Ltd. in Japan, known
as Sumitomo Eaton Nova Corporation, or SEN. SEN licenses our ion implant
technology, has exclusive rights to the territory of Japan and is the leading
producer of ion implantation equipment in Japan.
We, along with SEN, serve all of the 20 largest semiconductor manufacturers.
In 2001, the top 20 semiconductor manufacturers accounted for approximately
72.5% of total semiconductor industry capital spending. Semiconductor
manufacturing is a global business. The four largest semiconductor
manufacturing regions in the world are the United States, Asia Pacific (Taiwan,
South Korea and Singapore), Japan and Europe. We believe that more than 3,400
of our products, including products shipped by SEN, are in use worldwide.
We have been at the forefront of technological innovation in the ion implant
sector. For example, we developed the first high current ion implantation
system of which we are aware in the late 1970s and the first high energy ion
implantation system in the 1980s. In 1999, we installed what we believe is the
first 300 millimeter high energy ion implantation system, which we expect to be
the next generation of ion implant products. In addition, we pioneered the
development of photostabilization in 1983, and we have developed the only 300
millimeter production photostabilizer of which we are aware in the industry.
The semiconductor industry has been highly cyclical. During the period of
1989 through 2000, there was significant growth in demand for semiconductors,
with worldwide sales growing at an average annual compound rate of
approximately 12%, to $204 billion in 2000 according to World Semiconductor
Trade Statistics, an industry trade association. Estimated worldwide sales of
wafer fab equipment were $33.1 billion in 2000. The industry was in a down
cycle during 2001, with worldwide sales of wafer fab equipment estimated at
$22.4 billion, and opinions about the timing of a recovery in the sector vary
widely.
Our objective is to enhance our position as a leading producer of ion
implementation equipment and to offer a broad, integrated array of products and
services used primarily in the ion implant process sequence in wafer and chip
fabrication. Key elements of our strategy to achieve this objective include:
. increase ion implantation market penetration;
. grow our market position in photostabilization, dry strip and rapid
thermal processing by leveraging our ion implant position;
. maintain strong commitment to research and development through the
market cycle;
. provide our customers the lowest cost of ownership;
. provide our customers superior customer service; and
. reduce cycle times in our businesses.
4
RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks described below are not the only ones facing our
company. Additional risks not presently known to us or that we currently deem
immaterial may also impair our business operations.
Our business, financial condition or results of operations could be
materially harmed by any of these risks. The trading price of the notes and our
common stock could decline due to any of these risks, and you may lose all or
part of your investment.
Risks Related to the Notes
The following risk factors should be considered carefully in contemplating
an investment in the notes.
The notes are subordinated and contain no financial covenants, so we may be
unable to repay them.
The notes are unsecured and subordinated in right of payment to any senior
indebtedness. The notes also effectively will be subordinated to all our
subsidiaries' indebtedness and other liabilities, including trade payables. We
are not prohibited from incurring debt under the indenture and we may incur
additional debt, including senior indebtedness.
The indenture does not contain any financial covenants or restrictions on
the payment of dividends. The indenture does not restrict the issuance or
repurchase of securities by us or our subsidiaries. The indenture contains no
covenants or other provisions to afford you protection in the event of a highly
leveraged transaction, such as a leveraged recapitalization, that would
increase the level of our indebtedness or a change in control except as
described under "Description of Notes--Redemption at Option of the Holder." In
addition, our credit agreement currently prohibits us from redeeming the notes.
As a result, in the event of our bankruptcy, liquidation or reorganization,
the acceleration of the notes because of an event of default or certain other
events, our assets will be available to pay obligations on the notes only after
all senior indebtedness has been paid in full. Accordingly, we may not have
enough assets remaining to repay the notes.
Our credit agreement prohibits us from redeeming the notes, and we may not be
able to raise the funds necessary to repay the notes at any time, including
at maturity.
Holders of the notes may require us to redeem their notes for cash upon the
occurrence of specific kinds of fundamental changes. Our current revolving
credit agreement does not permit us to redeem the notes without the consent of
the lenders under the credit agreement. Unless we amend or terminate the credit
agreement, this provision may prevent us from redeeming the notes upon a
fundamental change or otherwise. Future agreements relating to our indebtedness
may contain similar limitations on our ability to redeem the notes. In
addition, it is possible that we would not have sufficient funds at that time
to make the required redemption of notes with cash. See "Description of
Notes--Redemption at Option of the Holder." Our failure to redeem notes upon
the occurrence of a fundamental change would constitute an event of default
under the indenture, which, in turn, might constitute a default under the terms
of our other indebtedness. If this were to occur, or if a fundamental change
were to constitute an event of default under any senior indebtedness, the
indenture's subordination provisions would restrict us from paying you.
An active trading market for the notes may not develop, so your investment
may not be profitable.
An active trading market for the notes may not develop, and any such market
may not be liquid or sustainable. Accordingly, holders may not be able to sell
the notes at a profit or at all. The future trading prices of
5
the notes will depend on many factors, including, among other things,
prevailing interest rates, our operating results, the market price of our
common stock and the market for similar securities.
Our notes may not be rated or may receive a lower rating than anticipated,
which would reduce their value.
It is possible that one or more rating agencies may rate the notes. However,
our notes may not be rated by all rating agencies. If one or more rating
agencies assigns the notes a rating lower than that expected by investors, the
market price of the notes and of our common stock could be materially and
adversely affected.
Risks Related to Our Business
The following risks affect our business generally.
If semiconductor equipment manufacturers do not make sufficient capital
expenditures, our sales and profitability will be harmed.
We anticipate that a significant portion of our new orders will depend upon
demand from semiconductor manufacturers who build or expand fabrication
facilities. If they do not build or expand fabrication facilities as rapidly as
we anticipate, demand for our systems will decline, reducing our revenues. This
would also hurt our profitability, because our continued investments in
engineering, research and development and marketing necessary to develop new
products and to maintain extensive customer service and support capabilities
limit our ability to reduce expenses in proportion to declining sales.
A number of factors may cause semiconductor manufacturers to make reduced
capital expenditures, including the following.
Downturns in the semiconductor industry may further reduce demand for our
products, harming our sales and profitability.
The semiconductor business is highly cyclical and the industry has been in a
severe down cycle since early in 2001, the length of which cannot be predicted.
This continues to reduce demand for new or expanded fabrication facilities. Any
continuing weakness or future downturns or slowdowns in the industry may
adversely affect our financial condition, which could hurt the market for the
notes.
Oversupply in the semiconductor industry reduces demand for capital
equipment, including our products.
Inventory buildups in the semiconductor industry, resulting in part from the
down cycle, have produced a current oversupply of semiconductors. This has
caused semiconductor manufacturers to revise capital spending plans, resulting
in reduced demand for capital equipment such as our products. If this
oversupply is not reduced by increasing demand from the various electronics
industries that use semiconductors, which we cannot accurately predict, our
sales and profitability will be harmed.
Industry consolidation and outsourcing of semiconductor manufacturing may
reduce the number of our potential customers, harming our revenues.
The substantial expense of building, upgrading or expanding a semiconductor
fabrication facility is increasingly causing semiconductor companies to
contract with foundries to manufacture their semiconductors. In addition,
consolidation within the semiconductor manufacturing industry is increasing.
These trends could reduce the number of our potential customers, increasing our
dependence on our remaining customers and materially and adversely affecting
our sales.
6
If we fail to develop and introduce reliable new or enhanced products and
services that meet the needs of semiconductor manufacturers, our results will
suffer.
Rapid technological changes in semiconductor manufacturing processes require
us to respond quickly to changing customer requirements. Our future success
will depend in part upon our ability to develop, manufacture and successfully
introduce new systems and product lines with improved capabilities and to
continue to enhance existing products, including products that process 300
millimeter wafers. This will depend upon a variety of factors, including new
product selection, timely and efficient completion of product design and
development and of manufacturing and assembly processes, product performance in
the field and effective sales and marketing. In particular:
. We must develop the technical specifications of competitive new systems,
or enhancements to our existing systems, and manufacture and ship these
systems or enhancements in volume in a timely manner.
. Due to the risks inherent in transitioning to new products, we will need
to accurately forecast demand for new products while managing the
transition from older products.
. We must avoid product reliability or quality problems that would lead to
reduced orders, higher manufacturing costs, delays in acceptance and
payment and additional service and warranty expenses.
. Our new products must be accepted in the marketplace.
Our failure to meet any of these requirements will have a material adverse
effect on our operating results and profitability.
If we fail to compete successfully in the highly competitive semiconductor
equipment industry, our sales and profitability will decline.
The market for semiconductor manufacturing equipment is highly competitive
and includes companies with substantially greater financial, engineering,
manufacturing, marketing and customer service and support resources than we
have that may be better positioned to compete successfully in the industry. In
addition, smaller companies engaged in semiconductor equipment research and
development could develop innovative technology having performance advantages
over our systems. Competitors are expected to continue to improve the design
and performance of their existing products and processes and to introduce new
products and processes with improved price and performance characteristics. If
we are unable to improve or introduce competing products when demanded by the
markets, our business will be harmed. In addition, if competitors enter into
strategic relationships with leading semiconductor manufacturers covering
products similar to those sold or being developed by us, our ability to sell
products to those manufacturers may be adversely affected.
We have been dependent on sales to a limited number of large customers; the
loss of any of these customers or any reduction in orders from them could
materially affect our sales.
Historically, we have sold a significant proportion of our products and
services to a limited number of fabricators of semiconductor products. For
example, in 2001, our top ten customers accounted for 50.6% of our net sales.
None of our customers has entered into a long-term agreement requiring it to
purchase our products. Although the composition of the group comprising our
largest customers has varied from year to year, the loss of a significant
customer or any reduction or delays in orders from any significant customer,
including reductions or delays due to customer departures from recent buying
patterns, or market, economic or competitive conditions in the semiconductor
industry, could adversely affect us. The ongoing consolidation of semiconductor
manufacturers may also increase the harmful effect of losing a significant
customer.
Our quarterly financial results may fluctuate significantly and may fall
short of anticipated levels.
We derive most of our revenues from the sale of a relatively small number of
expensive products to a small number of customers. The list prices on these
products range from $150,000 to over $5.0 million. At our current
7
sales level, each sale, or failure to make a sale, could have a material effect
on us in a particular quarter. Our lengthy sales cycle, coupled with customers'
competing capital budget considerations, make the timing of customer orders
uneven and difficult to predict. In a given quarter, a number of factors can
adversely affect our revenues and results, including changes in our product
mix, increased fixed expenses per unit due to reductions in the number of
products manufactured, and higher fixed costs due to increased levels of
research and development and expansion of our worldwide sales and marketing
organization. Our gross margins also may be affected by the introduction of new
products. We typically become more efficient in producing our products as they
mature. For example, our gross margins in 2001 were adversely affected in part
as a result of the increased proportion of relatively newly developed systems
sold to process 300 millimeter wafers. In addition, our backlog at the
beginning of a quarter may not include all orders required to achieve our sales
objectives for that quarter and is not a reliable indicator of our future
sales. As a result, our net sales and operating results for a quarter depend on
our shipping orders as scheduled during that quarter as well as obtaining new
orders for products to be shipped in that same quarter. Any delay in, or
cancellation of, scheduled shipments or in shipments from new orders could
materially and adversely affect our financial results, which could cause our
stock price to decline significantly. Due to the foregoing factors, we believe
that period-to-period comparisons of our operating results should not be relied
upon as an indicator of our future performance.
Termination of our Japanese joint venture, or a decline in its fortunes,
could hurt our business and profits.
We are dependent upon our Japanese joint venture, SEN, and Sumitomo Heavy
Industries Ltd. for access to the Japanese ion implant equipment market, and we
receive substantial income from our ion implantation technology license
agreement with SEN. The license agreement expires on December 31, 2004 and is
automatically renewable for successive five-year periods unless either party
has provided one year's prior notice of termination. Termination of this
license, or a substantial decline in SEN's sales and income from operations,
could have a material adverse effect on our net income.
A decline in sales of our products and services to customers outside the
United States would hurt our business and profits.
We are substantially dependent on sales of our products and services to
customers outside the United States, which accounted for approximately 53.5%,
69.4% and 62.0% of our net sales in 1999, 2000 and 2001, respectively. We
anticipate that international sales will continue to account for a significant
portion of our net sales. Because of our dependence upon international sales,
our results and prospects may be adversely affected by a number of factors,
including:
. unexpected changes in laws or regulations resulting in more burdensome
governmental controls, tariffs, restrictions, embargo or export license
requirements;
. difficulties in obtaining required export licenses;
. volatility in currency exchange rates;
. political and economic instability, particularly in Asia;
. difficulties in accounts receivable collections;
. extended payment terms beyond those customarily offered in the United
States;
. difficulties in managing distributors or representatives outside the
United States;
. difficulties in staffing and managing foreign subsidiary and branch
operations; and
. potentially adverse tax consequences.
8
Making more sales denominated in foreign currencies to counteract the strong
dollar may expose us to additional risks that could hurt our results.
Substantially all of our sales to date have been denominated in U.S.
dollars. Our products become less price competitive in countries with
currencies that are declining in value in comparison to the dollar. This could
cause us to lose sales or force us to lower our prices, which would reduce our
gross margins. Our equity income and royalty income from SEN are denominated in
Japanese yen, which exposes us to some risk of currency fluctuations. If it
becomes necessary for us to make more sales denominated in foreign currencies
to counteract the strong dollar, we will become more exposed to these risks.
We may not be able to maintain and expand our business if we are not able to
retain, hire and integrate additional qualified personnel.
Our business depends on our ability to attract and retain qualified,
experienced employees. There is substantial competition for experienced
engineering, technical, financial, sales and marketing personnel in our
industry. In particular, we must attract and retain highly skilled design and
process engineers. Competition for such personnel is intense, particularly in
the areas where we are based, including the Boston metropolitan area and the
Rockville, Maryland area, as well as in other locations around the world. If we
are unable to retain our existing key personnel, or attract and retain
additional qualified personnel, we may from time to time experience levels of
staffing inadequate to develop, manufacture and market our products and perform
services for our customers. As a result, our growth could be limited or we
could fail to meet our delivery commitments or experience deterioration in
service levels or decreased customer satisfaction, all of which could adversely
affect our financial results and cause the value of our notes and stock to
decline.
Our dependence upon a limited number of suppliers for many components and
sub-assemblies could result in increased costs or delays in manufacture and
sales of our products.
We rely to a substantial extent on outside vendors to manufacture many of
the components and subassemblies of our products. We obtain many of these
components and sub-assemblies from either a sole source or a limited group of
suppliers. Because of our reliance on outside vendors generally, and on a
limited group of suppliers in particular, we may be unable to obtain an
adequate supply of required components on a timely basis, on price and other
terms acceptable to us, or at all.
In addition, we often quote prices to our customers and accept customer
orders for our products before purchasing components and subassemblies from our
suppliers. If our suppliers increase the cost of components or subassemblies,
we may not have alternative sources of supply and may not be able to raise the
price of our products to cover all or part of the increased cost of components.
The manufacture of some of these components and subassemblies is an
extremely complex process and requires long lead times. As a result, we have in
the past and may in the future experience delays or shortages. If we are unable
to obtain adequate and timely deliveries of our required components or
subassemblies, we may have to seek alternative sources of supply or manufacture
these components internally. This could delay our ability to manufacture or to
ship our systems on a timely basis, causing us to lose sales, incur additional
costs, delay new product introductions and suffer harm to our reputation.
Our historical financial information may not be representative of our results
as a separate company.
Our combined financial statements for periods ending on or before June 30,
2000 have been carved out from the consolidated financial statements of Eaton
Corporation using the historical bases of assets, liabilities and operating
results of the semiconductor equipment operations business of Eaton that we
comprised. Accordingly, our historical financial information for those periods
does not necessarily reflect what our financial position, operating results and
cash flows would have been had we been a separate, stand-alone entity during
the periods
9
presented. Our costs and expenses for those periods were allocated to our
business based on Eaton's internal expense allocation methodology, which
charges these expenses to operating locations based both on net working
capital, excluding short-term investments and short-term debt, and on property,
plant and equipment-net. While we believe this allocation methodology is
reasonable and allocated costs are representative of the operating expenses
that would have been incurred had we operated on a stand-alone basis, such
historical financial information is not necessarily indicative of what our
financial position, operating results and cash flows will be in the future. We
have not made adjustments to this historical financial information to reflect
any significant changes that may occur in our cost structure and operations as
a result of our separation from Eaton, including increased costs associated
with being a publicly traded, stand-alone company.
In certain circumstances, we may need additional capital.
Our capital requirements may vary widely from quarter to quarter, depending
on, among other things, capital expenditures, fluctuations in our operating
results, financing activities, acquisitions and investments and inventory and
receivables management. We believe that our available cash, our credit line and
our future cash flow from operations will be sufficient to satisfy our working
capital, capital expenditure and research and development requirements for the
foreseeable future. This, of course, depends on the accuracy of our assumptions
about levels of sales and expenses, and a number of factors, including those
described in these "Risk Factors," could cause us to require additional capital
from external sources. In addition, in the future, we may require or choose to
obtain additional debt or equity financing in order to finance acquisitions or
other investments in our business. Depending on market conditions, future
equity financings may not be possible on attractive terms and would be dilutive
to the existing holders of our common stock and the notes. Moreover, until the
end of 2002, we are restricted in raising substantial amounts of equity capital
under a covenant to Eaton Corporation. Our existing credit agreement contains
restrictive covenants and future debt financings could involve restrictive
covenants all of which may limit the manner in which we conduct our business.
We may incur costly litigation to protect our proprietary technology, and if
unsuccessful, we may lose a valuable asset or experience reduced market share.
We rely on a combination of patents, copyrights, trademark and trade secret
laws, non-disclosure agreements and other intellectual property protection
methods to protect our proprietary technology. Despite our efforts to protect
our intellectual property, our competitors may be able to legitimately
ascertain the non-patented proprietary technology embedded in our systems. If
this occurs, we may not be able to prevent their use of this technology. Our
means of protecting our proprietary rights may not be adequate and our patents
may not be sufficiently broad to prevent others from using technology that is
similar to or the same as our technology. In addition, patents issued to us
have been, or might be challenged, and might be invalidated or circumvented and
any rights granted under our patents may not provide adequate protection to us.
Our competitors may independently develop similar technology, duplicate
features of our products or design around patents that may be issued to us. As
a result of these threats to our proprietary technology, we may have to resort
to costly litigation to enforce or defend our intellectual property rights.
On January 8, 2001, we filed a lawsuit against Applied Materials, Inc.
("Applied") in the United States District Court for the District of
Massachusetts. The complaint alleges that Applied's medium current/high energy
ion implanter machine launched in November 2000 infringes our patent for ion
implantation equipment using radio frequency linear accelerator technology. We
have also alleged that Applied unlawfully interfered with our existing and
future contracts. On January 18, 2001, we filed a motion for a preliminary
injunction for the reason, among others, that infringement at the time of
industry transition between equipment capable of handling 200 millimeter wafers
and equipment capable of handling 300 millimeter wafers would irreparably harm
us. Through this motion, we asked the court to stop Applied from manufacturing,
selling or offering to sell its medium current/high energy ion implanter
machine and to order Applied to remove all our patented technology from
implanters that Applied may have placed in chipmakers' plants for process
development trials. Applied filed counterclaims of unfair competition,
defamation and tortious interference with prospective
10
economic advantage, all of which, it contends, arise from certain
communications we allegedly made about the lawsuit and its claims of
infringement.
Hearings on summary judgment motions began in December 2001 and are
continuing. We believe our claims are meritorious and intend to pursue the
matter vigorously. Although there can be no assurance of a favorable outcome
and we are incurring significant legal expenses to pursue this litigation, we
do not believe that our pursuit of this matter will have a material adverse
effect on our financial condition, results of operations or liquidity. In the
event that Applied is found not to have infringed, we expect that Applied will
continue to sell its medium current/high energy implanter as a new and
substantial competitor for sales of high energy/medium current ion implantation
equipment.
We might face intellectual property infringement claims or patent disputes
that may be costly to resolve and, if resolved against us, could be very
costly to us and prevent us from making and selling our systems.
From time to time, claims and proceedings have been or may be asserted
against us relative to patent validity or infringement matters. Our involvement
in any patent dispute or other intellectual property dispute or action to
protect trade secrets, even if the claims are without merit, could be very
expensive to defend and could divert the attention of our management. Adverse
determinations in any litigation could subject us to significant liabilities to
third parties, require us to seek costly licenses from third parties and
prevent us from manufacturing and selling our systems. Any of these situations
could have a material adverse effect on us and cause the value of our common
stock to decline.
Our agreements with Eaton Corporation may not have the same terms that such
agreements would have if they had been negotiated in an arm's length
transaction.
Before our initial public offering, we entered into a number of agreements
with Eaton Corporation. These agreements were negotiated at a time when we were
a wholly-owned subsidiary of Eaton and therefore may not have the same terms
that such agreements would have had if they had been negotiated in an arm's
length transaction.
Covenants and payables in favor of Eaton. Our agreements with Eaton
restrict our operations and obligate us to make payments to Eaton in certain
situations, including:
. The Tax Sharing and Indemnification Agreement makes us liable to Eaton
for our allocable share of taxes arising for all periods beginning after
December 31, 1999 through December 29, 2000. If Eaton were audited for
this period and additional taxes were due, we would be obligated to
indemnify Eaton.
. Until December 29, 2002, without Eaton's consent, we may not liquidate,
merge or consolidate with any person, dispose of or restructure the
holding of our assets, or enter into any transaction or make any change
in our equity structure that would violate a restrictive covenant
designed to protect the tax-free nature of Eaton's distribution of our
shares in December 2000.
. We have agreed not to solicit or recruit employees of Eaton without
Eaton's consent until December 29, 2002.
Conflicts under Eaton agreements and otherwise. Conflicts may arise under
our agreements with Eaton Corporation and other interests of Axcelis and Eaton
may differ from time to time. We have agreed to submit all disputes under the
agreements with Eaton to binding arbitration, following nonbinding mediation,
unless the failure to initiate litigation would cause serious and irreparable
injury to one of us or others. Three of our directors are also directors of
Eaton and one, Alexander M. Cutler, is also the Chairman and Chief Executive
Officer of Eaton. Our directors who are also directors of Eaton have
obligations to both companies and may have conflicts of interest with respect
to matters that could have different implications for Eaton and us.
11
RATIO OF EARNINGS TO FIXED CHARGES
Ratio of Earnings
Period to Fixed Charges(A)
------ -------------------
Fiscal quarter ended March 31, 2002 (B)
Fiscal year ended December 31, 2001 (B)
Fiscal year ended December 31, 2000 54.5
Fiscal year ended December 31, 1999 13.7
Fiscal year ended December 31, 1998 (B)
Fiscal year ended December 31, 1997 (B)
(A) The ratio of earnings to fixed charges is calculated by dividing (1) income
before income taxes (adjusted for the Company's share of income from of its
50% owned affiliate, Sumitomo Eaton Nova Corporation), plus fixed charges
by (2) fixed charges. Fixed charges include the portion of rental expense
under operating leases deemed by the Company to be representative of the
interest factor in rent expense.
(B) During the fiscal years ended December 31, 1997, 1998 and 2001, and the
fiscal quarter ended March 31, 2002, there was a deficiency of earnings to
cover fixed charges of approximately $61.4 million, $133.1 million, $40.4
million and $27.9 million, respectively.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the notes or the shares of
common stock offered by this prospectus.
DESCRIPTION OF CREDIT FACILITY
In the fourth quarter of 2001, we established a $45 million secured,
three-year revolving credit facility. The purpose of this facility is to
provide funds for working capital and general corporate purposes. Borrowings
under this credit arrangement are limited to the lesser of $45 million or the
sum of a percentage of certain eligible domestic accounts receivable and
inventory and bear interest at LIBOR plus an applicable spread. The facility
contains certain financial and other restrictive covenants including minimum
profitability, liquidity and leverage ratios as well as maximum capital
expenditure levels. We are currently in compliance with all covenants under
this facility. There are no borrowings currently outstanding under this
facility, although our availability is reduced by an outstanding letter of
credit. Any amounts owed under this credit facility rank senior to the notes
offered by this prospectus.
DESCRIPTION OF NOTES
We issued $125,000,000 aggregate principal amount of notes under an
indenture dated as of January 15, 2002 between us and State Street Bank and
Trust Company, as trustee. A copy of the indenture may also be obtained from
the trustee upon written request.
The following is a summary of the material provisions of the notes and the
indenture. It does not purport to be complete. This summary is subject to and
is qualified by reference to all the provisions of the indenture, including the
definitions of certain terms used in the indenture. Wherever particular
provisions or defined terms of the indenture or form of note are referred to,
these provisions or defined terms are incorporated in this offering memorandum
by reference. The terms of the notes also include those made a part of the
indenture by reference to the Trust Indenture Act of 1939, as amended.
As used in this section, references to "Axcelis," "we," "our" or "us" refer
solely to Axcelis and not to our subsidiaries.
12
General
The notes are general unsecured obligations of Axcelis that bear interest at
an annual rate of 4 1/4% from January 15, 2002. We will pay interest on January
15 and July 15 of each year, beginning July 15, 2002, to record holders at the
close of business on the preceding January 1 and July 1, as the case may be.
Interest will be computed on the basis of a 360-day year composed of twelve
30-day months. The notes will mature on January 15, 2007 unless earlier
converted, redeemed at our option or redeemed at your option upon a fundamental
change. Interest payable upon redemption will be paid to the person to whom
principal is payable, unless the redemption date is an interest payment date.
The notes are convertible into common stock as described under "Conversion of
Notes."
Our payment obligations under the notes are subordinated to our senior
indebtedness as described under "Subordination of Notes." Neither we nor any of
our subsidiaries are subject to any financial covenants under the indenture. In
addition, neither we nor any of our subsidiaries are restricted under the
indenture from paying dividends, incurring debt, or issuing or repurchasing our
securities. You are not afforded protection under the indenture in the event of
a highly leveraged transaction or a change in control of us except to the
extent described below under "Redemption at Option of the Holder."
Conversion of Notes
You may convert any of your notes, in whole or in part, into common stock up
to and including the final maturity date of the notes, subject to prior
redemption of the notes. If we call notes for redemption, you may convert them
only until the close of business on the business day before the redemption date
unless we fail to pay the redemption price. If you have submitted your notes
for redemption upon a fundamental change, you may convert your notes only if
you withdraw your redemption election. You may convert a portion of your notes
so long as the portion converted is $1,000 principal amount or a multiple of
$1,000.
The initial conversion rate for the notes is 50 shares of common stock per
$1,000 principal amount of notes, subject to adjustment as described below. If
any note is converted during the period after a record date for an interest
payment date to but excluding the corresponding interest payment date, then
unless that note has been called for redemption on a redemption date that
occurs during such period (in which case we will not be required to pay
interest on such interest payment date with respect to such note), the note
must be accompanied by funds equal to the interest payable on that interest
payment date on the principal amount so converted; provided that no such
payment need be made to the extent any interest on such note is overdue at the
time of conversion. We will not issue fractional shares of common stock upon
conversion of notes. Instead, we will pay cash equal to the closing price of
the common stock on the trading day before the conversion date. You will not
receive any cash payments representing accrued interest or dividends upon
conversion unless you convert on an interest payment date. Our delivery to you
of the fixed number of shares of common stock into which a note is convertible,
together with any cash payment in lieu of any fractional shares, will satisfy
our obligation to pay the principal amount of such note and the accrued but
unpaid interest through the conversion date. Thus, the accrued but unpaid
interest through the conversion date will be deemed to be paid in full rather
than cancelled, extinguished or forfeited.
We will adjust the conversion rate if any of the following events occurs:
(1) we issue common stock as a dividend or distribution on our common stock;
(2) we issue to all holders of common stock rights or warrants to purchase
our common stock;
(3) we subdivide or combine our common stock;
(4) we distribute to all holders of our common stock shares of our capital
stock, evidences of indebtedness or assets, including securities but
excluding:
13
. rights or warrants listed in (2) above;
. dividends or distributions listed in (1) above; and
. cash distributions;
(5) we distribute cash, excluding any dividend or distribution in connection
with our liquidation, dissolution or winding up or any quarterly cash
dividend on our common stock to the extent that the aggregate cash
dividend per share of common stock in any quarter does not exceed the
greater of:
. the amount per share of common stock of the next preceding quarterly
cash dividend on the common stock to the extent that the preceding
quarterly dividend did not require an adjustment of the conversion
rate pursuant to this clause (5), as adjusted to reflect subdivisions
or combinations of the common stock; and
. 3.75% of the average of the last reported sale price of the common
stock during the ten trading days immediately before the declaration
date of the dividend.
If an adjustment is required to be made under this clause (5) as a result of a
distribution that is a quarterly dividend, the adjustment would be based upon
the amount by which the distribution exceeds the amount of the quarterly cash
dividend permitted to be excluded pursuant to this clause (5). If an adjustment
is required to be made under this clause (5) as a result of a distribution that
is not a quarterly dividend, the adjustment would be based upon the full amount
of the distribution;
(6) we or one of our subsidiaries makes a payment in respect of a tender
offer or exchange offer for our common stock to the extent that the cash
and value of any other consideration included in the payment per share
of common stock exceeds the current market price per share of common
stock on the next trading day after the last date on which tenders or
exchanges may be made pursuant to such tender or exchange offer; and
(7) someone other than us or one of our subsidiaries makes a payment in
respect of a tender offer or exchange offer in which, as of the closing
date of the offer, our board of directors is not recommending rejection
of the offer. The adjustment referred to in this clause (7) will only be
made if:
. the tender offer or exchange offer is for an amount that increases
the offeror's ownership of common stock to more than 25% of the total
shares of common stock outstanding; and
. the cash and value of any other consideration included in the payment
per share of common stock exceeds the current market price per share
of common stock on the next business day after the last date on which
tenders or exchanges may be made pursuant to the tender or exchange
offer.
However, the adjustment referred to in this clause (7) will generally
not be made if as of the closing of the offer, the offering documents
disclose a plan or an intention to cause us to engage in a
consolidation or merger or a sale of all or substantially all of our
assets.
If the rights provided for in our rights agreement dated as of June 30, 2000
have separated from our common stock in accordance with the provisions of the
rights agreement so that the holders of the notes would not be entitled to
receive any rights in respect of the common stock issuable upon conversion of
the notes, the conversion rate will be adjusted as provided in clause (4)
above, subject to readjustment in the event of the expiration, termination or
redemption of the rights. In lieu of any such adjustment, we may amend our
rights agreement to provide that upon conversion of the notes the holders will
receive, in addition to the common stock issuable upon such conversion, the
rights that would have attached to such shares of common stock if the rights
had not become separated from the common stock under our rights agreement. To
the extent that we adopt any future shareholder rights plan, upon conversion of
the notes into common stock, you will receive the rights under the future
rights plan in addition to the common stock, whether or not the rights have
separated from the
14
common stock at the time of conversion, and no adjustment to the conversion
rate shall be made in accordance with clause (4) above.
In the event of:
. any reclassification of our common stock;
. a consolidation, merger or combination involving us; or
. a sale or conveyance to another person or entity of all or substantially
all of our property and assets;
in which holders of our common stock would be entitled to receive stock, other
securities, other property, assets or cash for their common stock, you will be
entitled upon conversion of your notes to receive the same type of
consideration that you would have been entitled to receive if you had converted
the notes into our common stock immediately before any of these events.
In certain situations, you may be deemed to have received a distribution
subject to United States federal income tax as a dividend in the event of any
taxable distribution to holders of common stock or in certain other situations
requiring a conversion rate adjustment.
We may, from time to time, increase the conversion rate for a period of at
least 20 days if our board of directors has made a determination that this
increase would be in our best interests. Any such determination by our board
will be conclusive. We would give holders at least 15 days' notice of any
increase in the conversion rate. In addition, we may increase the conversion
rate if our board of directors deems it advisable to avoid or diminish any
income tax to holders of common stock resulting from any stock or rights
distribution.
We will not be required to make an adjustment in the conversion rate unless
the adjustment would require a change of at least 1% in the conversion rate.
However, we will carry forward any adjustments that are less than 1% of the
conversion rate. Except as described above in this section, we will not adjust
the conversion rate for any issuance of our common stock or convertible or
exchangeable securities or rights to purchase our common stock or convertible
or exchangeable securities.
Redemption of Notes at our Option
Beginning January 19, 2005, we may redeem the notes in whole or in part at
the following prices, expressed as a percentage of the principal amount:
Redemption Period Redemption Price
----------------- ----------------
Beginning on January 19, 2005 and ending on January 14, 2006 101.70%
Beginning on January 15, 2006 and ending on January 14, 2007 100.85%
and 100% if redeemed on January 15, 2007. We may not redeem notes if we have
failed to pay any interest on the notes and such failure to pay is continuing.
We will give notice of redemption by mail to holders not more than 60 but not
less than 30 days before the redemption date.
If less than all of the outstanding notes are to be redeemed, the trustee
will select the notes to be redeemed in principal amounts of $1,000 or
multiples of $1,000 by lot, pro rata or by another method the trustee considers
fair and appropriate. If a portion of your notes is selected for partial
redemption and you convert a portion of your notes, the converted portion will
be deemed to be of the portion selected for redemption.
Redemption at Option of the Holder
If a "fundamental change" occurs at any time before the maturity of the
notes, you may require us to redeem your notes, in whole or in part, on a
redemption date that is 30 days after the date of our notice of the fundamental
change. The notes will be redeemable in principal amounts of $1,000 or
multiples of $1,000.
15
We will redeem the notes at a price equal to 100% of the principal amount to
be redeemed, plus accrued interest to, but excluding, the redemption date. If
the redemption date is an interest payment date, we will pay interest to the
record holder on the applicable record date.
We will mail to all record holders a notice of a fundamental change within
10 days after it has occurred. We are also required to deliver to the trustee a
copy of the fundamental change notice. If you elect to redeem your notes, you
must deliver to us or our designated agent, on or before the 30th day after the
date of our fundamental change notice, your redemption notice and any notes to
be redeemed, duly endorsed for transfer. We will promptly pay the redemption
price for notes surrendered for redemption following the redemption date.
A "fundamental change" is any transaction or event (whether by means of an
exchange offer, liquidation, tender offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise) in connection with which all
or substantially all of our common stock is exchanged for, converted into,
acquired for or constitutes solely the right to receive, consideration that is
not all or substantially all common stock that:
. is listed on, or immediately after the transaction or event will be
listed on, a United States national securities exchange, or
. is approved, or immediately after the transaction or event will be
approved, for quotation on the NASDAQ National Market or any similar
United States system of automated dissemination of quotations of
securities prices.
We will comply with any applicable provisions of Rule 13e-4 and any other
tender offer rules under the Securities Exchange Act of 1934, as amended, in
the event of a fundamental change.
These fundamental change redemption rights could discourage a potential
acquiror of Axcelis. However, this fundamental change redemption feature is not
the result of management's knowledge of any specific effort to obtain control
of Axcelis by means of a merger, tender offer or solicitation, or part of a
plan by management to adopt a series of anti-takeover provisions.
The term "fundamental change" is limited to specified transactions and may
not include other events that might adversely affect our financial condition or
business operations. We could in the future enter into certain transactions,
including highly leveraged recapitalizations, that would not constitute a
fundamental change and would, therefore, not provide the holders with the
protection of requiring us to repurchase the notes.
We may be unable to redeem the notes in the event of a fundamental change.
If a fundamental change were to occur, we may not have enough funds to pay the
redemption price for all tendered notes. We are prohibited by our revolving
credit agreement from redeeming the notes, and any redemption or repurchase of
any notes would constitute an event of default. In addition, any future credit
agreements or other agreements relating to our indebtedness may contain
provisions prohibiting redemption of the notes in certain circumstances, or may
expressly prohibit our repurchase of the notes upon a fundamental change or may
provide that a fundamental change constitutes an event of default under that
agreement. If a fundamental change occurs at a time when we are prohibited from
purchasing or redeeming notes, we could seek the consent of our lenders to
redeem the notes or attempt to refinance this debt. If we do not obtain
consent, we would not be permitted to purchase or redeem the notes. Our failure
to redeem tendered notes would constitute an event of default under the
indenture, which might constitute a default under the terms of our other
indebtedness. In these circumstances, the subordination provisions of the
indenture would restrict payments to the holders of notes.
Subordination of Notes
Payment on the notes will, to the extent provided in the indenture, be
subordinated in right of payment to the prior payment in full of all of our
senior indebtedness. The notes also are effectively subordinated to all debt
and other liabilities, including trade payables and lease obligations, if any,
of our subsidiaries.
16
Upon any distribution of our assets upon any dissolution, winding up,
liquidation or reorganization, the payment of the principal of, or premium, if
any, interest, and liquidated damages, if any, on the notes will be
subordinated in right of payment to the prior payment in full in cash or other
payment satisfactory to the holders of senior indebtedness of all senior
indebtedness. In the event of any acceleration of the notes because of an event
of default, the holders of any outstanding senior indebtedness would be
entitled to payment of such indebted ness in full before the holders of the
notes are entitled to receive any payment or distribution. We are required
under the indenture to notify holders of senior indebtedness promptly if
payment of the notes is accelerated because of an event of default.
We may not make any payment on the notes if:
. a default in the payment of senior indebtedness occurs and is continuing
beyond any applicable period of grace (called a "payment default"); or
. a default other than a payment default on any designated senior
indebtedness occurs and is continuing that permits holders of designated
senior indebtedness to accelerate its maturity,
. or in the case of a lease, a default occurs and is continuing that
permits the lessor to either terminate the lease or require us to make
an irrevocable offer to terminate the lease following an event of
default under the lease, and the trustee receives a notice of such
default (called "payment blockage notice") from us or any other person
permitted to give such notice under the indenture (called a "non-payment
default").
We may resume payments and distributions on the notes:
. in case of a payment default, upon the date on which such default is
cured or waived or ceases to exist; and
. in case of a non-payment default, the earlier of the date on which such
nonpayment default is cured or waived or ceases to exist or 179 days
after the date on which the payment blockage notice is received, if the
maturity of the designated senior indebtedness has not been accelerated,
or in the case of any lease, 179 days after notice is received if we
have not received notice that the lessor under such lease has exercised
its right to terminate the lease or require us to make an irrevocable
offer to terminate the lease following an event of default under the
lease.
No new period of payment blockage may be commenced pursuant to a payment
blockage notice unless 365 days have elapsed since the initial effectiveness of
the immediately prior payment blockage notice. No non-payment default that
existed or was continuing on the date of delivery of any payment blockage
notice shall be the basis for any later payment blockage notice.
If the trustee or any holder of the notes receives any payment or
distribution of our assets in contravention of the subordination provisions on
the notes before all senior indebtedness is paid in full, then such payment or
distribution will be held in trust for the benefit of holders of senior
indebtedness or their representatives to the extent necessary to pay all unpaid
senior indebtedness in full.
Because of these subordination provisions, in the event of our bankruptcy,
dissolution or reorganization, holders of senior indebtedness may receive more,
ratably, and holders of the notes may receive less, ratably, than our other
creditors. This subordination will not prevent the occurrence of any event of
default under the indenture.
The notes are exclusively obligations of Axcelis. A substantial portion of
our operations are conducted through our subsidiaries. As a result, our cash
flow and our ability to service our debt, including the notes, is dependent
upon the earnings of our subsidiaries and on the distribution of earnings,
loans or other payments from our subsidiaries. Any payment of dividends,
distributions, loans or advances by our subsidiaries to us could be
17
subject to statutory or contractual restrictions. Payments to us by our
subsidiaries will also be contingent upon our subsidiaries' earnings and
business considerations.
Our right to receive any assets of any of our subsidiaries upon their
liquidation or reorganization, and therefore the right of the holders to
participate in those assets, will be effectively subordinated to the claims of
that subsidiary's creditors, including trade creditors. In addition, even if we
were a creditor to any of our subsidiaries, our rights as a creditor would be
subordinate to any security interest in the assets of our subsidiaries and any
indebtedness of our subsidiaries senior to that held by us.
The term "senior indebtedness" is defined in the indenture and includes
principal, premium, interest, rent, fees, costs, expenses and other amounts
accrued or due on our existing or future indebtedness, as defined below, or any
existing or future indebtedness guaranteed or in effect guaranteed by us,
subject to certain exceptions. The term does not include:
. any indebtedness that by its express terms is not senior to the notes or
is pari passu or junior to the notes; or
. any indebtedness we owe to any of our majority-owned subsidiaries; or
. the notes.
The term "indebtedness" is also defined in the indenture and includes our
liabilities in respect of borrowed money, notes, bonds, debentures, letters of
credit, bank guarantees, bankers' acceptances, capital and certain other
leases, interest rate and foreign currency derivative contracts or similar
arrangements, guarantees and certain other obligations described in the
indenture, subject to certain exceptions. The term does not include any account
payable or other accrued current liability or obligation incurred in the
ordinary course of business in connection with the obtaining of materials or
services.
The term "designated senior indebtedness" is defined in the indenture and
includes any senior indebtedness that by its terms expressly provides that it
is "designated senior indebtedness" for purposes of the indenture. Designated
senior indebtedness includes any indebtedness we may incur in the future under
our existing $45 million revolving line of credit.
As of the date of this prospectus, we had no senior indebtedness outstanding
and our subsidiaries had no significant indebtedness. Neither we nor our
subsidiaries are prohibited from incurring debt, including senior indebtedness,
under the indenture. We may from time to time incur additional debt, including
senior indebtedness. Our subsidiaries may also from time to time incur
additional debt and liabilities.
We are obligated to pay reasonable compensation to the trustee and to
indemnify the trustee against certain losses, liabilities or expenses incurred
by the trustee in connection with its duties relating to the notes. The
trustee's claims for these payments will generally be senior to those of
noteholders in respect of all funds collected or held by the trustee.
Merger and Sale of Assets by Us
The indenture provides that we may not consolidate with or merge with or
into any other person or convey, transfer or lease its properties and assets
substantially as an entirety to another person, unless among other items:
. we are the surviving person, or the resulting, surviving or transferee
person, if other than us, is organized and existing under the laws of
the United States, any state thereof or the District of Columbia;
. the successor person assumes all our obligations under the notes and the
indenture; and
. we or such successor person will not be in default under the indenture
immediately after the transaction.
18
When such a person assumes our obligations in such circumstances, subject to
certain exceptions, we shall be discharged from all obligations under the notes
and the indenture.
Events of Default; Notice and Waiver
The following will be events of default under the indenture:
. we fail to pay principal or premium, if any, when due upon redemption or
otherwise on the notes, whether or not the payment is prohibited by
subordination provisions;
. we fail to pay any interest and liquidated damages, if any, on the
notes, when due and such failure continues for a period of 30 days,
whether or not the payment is prohibited by subordination provisions of
the indenture;
. we fail to perform or observe any of the covenants in the indenture for
60 days after notice; or
. certain events involving our bankruptcy, insolvency or reorganization.
The trustee may withhold notice to the holders of the notes of any default,
except defaults in payment of principal, premium, interest or liquidated
damages, if any, on the notes. However, the trustee must consider it to be in
the interest of the holders of the notes to withhold this notice.
If an event of default occurs and continues, the trustee or the holders of
at least 25% in principal amount of the outstanding notes may declare the
principal, premium, if any, and accrued interest and liquidated damages, if
any, on the outstanding notes to be immediately due and payable. In case of
certain events of bankruptcy or insolvency involving us, the principal,
premium, if any, and accrued interest and liquidated damages, if any, on the
notes will automatically became due and payable. However, if we cure all
defaults, except the nonpayment of principal, premium, if any, interest or
liquidated damages, if any, that became due as a result of the acceleration,
and meet certain other conditions, with certain exceptions, this declaration
may be cancelled and the holders of a majority of the principal amount of
outstanding notes may waive these past defaults.
Payments of principal, premium, if any, or interest on the notes that are
not made when due will accrue interest at the annual rate of 4 1/4% from the
required payment date.
The holders of a majority of outstanding notes will have the right to direct
the time, method and place of any proceedings for any remedy available to the
trustee, subject to limitations specified in the indenture.
No holder of the notes may pursue any remedy under the indenture, except in
the case of a default in the payment of principal, premium, if any, or interest
on the notes, unless:
. the holder has given the trustee written notice of an event of default;
. the holders of at least 25% in principal amount of outstanding notes
make a written request, and offer reasonable indemnity, to the trustee
to pursue the remedy;
. the trustee does not receive an inconsistent direction from the holders
of a majority in principal amount of the notes; and
. the trustee fails to comply with the request within 60 days after
receipt.
Modification and Waiver
Subject to certain exceptions, the consent of the holders of a majority in
aggregate principal amount of the outstanding notes is required to modify or
amend the indenture. However, a modification or amendment requires the consent
of the holder of each outstanding note if it would:
. extend the fixed maturity of any note;
. reduce the rate or extend the time for payment of interest of any note;
19
. reduce the principal amount or premium of any note;
. reduce any amount payable upon redemption or repurchase of any note;
. adversely change our obligation to redeem any note upon a fundamental
change;
. impair the right of a holder to institute suit for payment on any note;
. change the currency in which any note is payable;
. impair the right of a holder to convert any note;
. adversely modify, in any material respect, the subordination provisions
of the indenture;
. reduce the quorum or voting requirements under the indenture; or
. reduce the percentage of notes required for consent to any modification
of the indenture.
Global Note, Book-Entry Form
We have issued the notes in the form of a global note. The global note has
been deposited with the trustee as custodian for DTC and registered in the name
of Cede & Co. as DTC's nominee. Except as set forth below, the global note may
be transferred, in whole or in part, only to another nominee of DTC or to a
successor of DTC or its nominee.
Beneficial holders of the notes may hold their interests in the notes
directly through DTC if such holder is a participant in DTC, or indirectly
through organizations that are participants in DTC (called "participants").
Transfers between participants will be effected in the ordinary way in
accordance with DTC rules and will be settled in clearing house funds. The laws
of some states require that certain persons take physical delivery of
securities in definitive form. As a result, the ability to transfer beneficial
interests in the global note to such persons may be limited.
Beneficial holders who are not participants may beneficially own interests
in a global note held by DTC only through participants, or banks, brokers,
dealers, trust companies and other parties that clear through or maintain a
custodial relationship with a participant, either directly or indirectly
(called "indirect participants"). So long as Cede & Co., as the nominee of DTC,
is the registered owner of a global note, Cede & Co. for all purposes will be
considered the sole holder of such global note. Except as provided below,
owners of beneficial interests in a global note will:
. not be entitled to have certificates registered in their names;
. not receive physical delivery of certificates in definitive registered
form; and
. not be considered holders of the global note.
We will pay interest on and the redemption price of a global note to Cede &
Co., as the registered owner of the global note, by wire transfer of
immediately available funds on each interest payment date or the redemption or
repurchase date, as the case may be. Neither we, the trustee nor any paying
agent will be responsible or liable:
. for the records relating to, or payments made on account of, beneficial
ownership interests in a global note; or
. for maintaining, supervising or reviewing any records relating to the
beneficial ownership interests.
We have been informed that DTC's practice is to credit participants'
accounts on that payment date with payments in amounts proportionate to their
respective beneficial interests in the principal amount represented by a global
note as shown in the records of DTC, unless DTC has reason to believe that it
will not receive payment on that payment date. Payments by participants to
owners of beneficial interests in the principal amount
20
represented by a global note held through participants will be the
responsibility of the participants, as is now the case with securities held for
the accounts of customers registered in "street name."
Because DTC can only act on behalf of participants, who in turn act on
behalf of indirect participants, the ability of a person having a beneficial
interest in the principal amount represented by the global note to pledge such
interest to persons or entities that do not participate in the DTC system, or
otherwise take actions in respect of such interest, may be affected by the lack
of a physical certificate evidencing its interest.
Neither we, the trustee, registrar, paying agent nor conversion agent will
have any responsibility for the performance by DTC or its participants or
indirect participants of their respective obligations under the rules and
procedures governing their operations. DTC has advised us that it will take any
action permitted to be taken by a holder of notes, including the presentation
of notes for exchange, only at the direction of one or more participants to
whose account with DTC interests in the global note are credited, and only in
respect of the principal amount of the notes represented by the global note as
to which the participant or participants has or have given such direction.
DTC has advised us that it is:
. a limited purpose trust company organized under the laws of the State of
New York, and a member of the Federal Reserve System;
. a "clearing corporation" within the meaning of the Uniform Commercial
Code; and
. a "clearing agency" registered pursuant to the provisions of Section 17A
of the Exchange Act.
DTC was created to hold securities for its participants and to facilitate
the clearance and settlement of securities transactions between participants
through electronic book-entry changes to the accounts of its participants.
Participants include securities brokers, dealers, banks, trust companies and
clearing corporations and other organizations. Some of the participants or
their representatives, together with other entities, own DTC. Indirect access
to the DTC system is available to others such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.
DTC has agreed to the foregoing procedures to facilitate transfers of
interests in a global note among participants. However, DTC is under no
obligation to perform or continue to perform these procedures, and may
discontinue these procedures at any time. If DTC is at any time unwilling or
unable to continue as depositary and a successor depositary is not appointed by
us within 90 days, we will issue notes in certificated form in exchange for
global notes.
Information Concerning the Trustee
We have appointed State Street Bank and Trust Company, the trustee under the
indenture, as paying agent, conversion agent, note registrar and custodian for
the notes. The trustee or its affiliates may provide banking and other services
to us in the ordinary course of their business.
The indenture contains limitations on the rights of the trustee, if it or
any of its affiliates is then our creditor, to obtain payment of claims in
certain cases or to realize on certain property received on any claim as
security or otherwise. The trustee and its affiliates will be permitted to
engage in other transactions with us. However, if the trustee or any affiliate
continues to have any conflicting interest and a default occurs with respect to
the notes, the trustee must eliminate such conflict or resign.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is EquiServe Trust
Company, N.A., 150 Royall Street, Canton, Massachusetts 02021.
21
SELLING SECURITYHOLDERS
We originally issued the notes in a private placement in January 2002. The
notes were resold by the initial purchasers to persons they reasonably believed
to be qualified institutional buyers under Rule 144A under the Securities Act.
Selling securityholders may use this prospectus to offer and sell the notes and
the shares of common stock issuable upon conversion of the notes.
The table below sets forth information about the beneficial ownership of the
notes and shares of common stock by each selling securityholder who has timely
provided us with a completed and executed notice and questionnaire stating its
intent to use this prospectus to sell or otherwise dispose of notes and/or
shares of common stock issuable upon conversion of the notes.
We have prepared this table using information furnished to us by DTC and/or
by or on behalf of the selling securityholders. Except as otherwise indicated
below, to our knowledge, no selling securityholder nor any of its affiliates
has held any position or office with, been employed by or otherwise has had any
material relationship with us or our affiliates during the three years before
the date of this prospectus.
Our registration of the notes and the shares of common stock issuable upon
conversion of the notes does not mean that the selling securityholders
identified below will sell all or any of these securities. In addition, the
selling securityholders may have sold, transferred or disposed of all or a
portion of their notes since the date on which they provided the information
regarding their holdings in transactions exempt from the registration
requirements of the Securities Act.
Number of Shares of Number of Shares
Principal Amount of Notes Percentage Common Stock Issuable of Common Stock
Beneficially Owned That of Notes Upon Conversion That Beneficially Owned
Name (1) May be Sold Outstanding May be Sold (2) After Offering (3)
-------- ------------------------- ----------- --------------------- ------------------
AIG/National Union Fire Insurance.. $ 310,000 * 15,500 0
Akela Capital Masterfund, Ltd...... 1,000,000 * 50,000 0
Allstate Insurance Company (4)..... 450,000 * 22,500 49,130
Allstate Life Insurance Company (4) 250,000 * 12,500 49,130
Alpine Associates.................. 6,350,000 5.1 317,500 0
Alpine Partners, L.P............... 900,000 * 45,000 0
Argent Low Lev Convertible
Arbitrage Fund Ltd................ 1,000,000 * 50,000 0
Arkansas PERS...................... 340,000 * 17,000 0
BBT Fund, L.P...................... 2,000,000 1.6 100,000 0
Boilermakers Blacksmith Pension
Trust............................. 420,000 * 21,000 0
BP Amoco PLC Master Trust.......... 619,000 * 30,950 0
Campbell, James, the Estate of..... 160,000 * 8,000 0
Castle Convertible Fund, Inc....... 500,000 * 25,000 0
Cobra Fund U.S.A., L.P............. 25,000 * 1,250 0
Cobra Masterfund, Ltd.............. 575,000 * 28,750 0
Delaware PERS...................... 450,000 * 22,500 0
Deutsche Bank Securities, Inc...... 8,300,000 6.6 415,000 0
Duke Endowment..................... 90,000 * 4,500 0
Fidelity Financial Trust: Fidelity
Convertible Securities Fund (5)... 3,500,000 2.8 175,000 0
First Union Risk Management, Inc... 10,000,000 8.0 500,000 0
F.R. Convt. Sec. Fn................ 50,000 * 2,500 0
Grace Brothers Management L.L.C.... 1,500,000 1.2 75,000 0
Granville Capital Corporation...... 1,000,000 * 50,000 0
ICI American Holdings Trust........ 170,000 * 8,500 0
The James Campbell Corporation..... 213,000 * 10,650 0
22
Number of Shares of Number of Shares
Principal Amount of Notes Percentage Common Stock Issuable of Common Stock
Beneficially Owned That of Notes Upon Conversion That Beneficially Owned
Name (1) May be Sold Outstanding May be Sold (2) After Offering (3)
-------- ------------------------- ----------- --------------------- ------------------
Man Convertible Bond Master
Fund, Ltd......................... 6,470,000 5.2 323,500 0
McMahan Securities Co., L.P........ 1,000,000 * 50,000 0
Morgan Stanley & Co., Inc. (6)..... 20,000,000 16 1,000,000 0
Morgan Stanley Dean Witter
Convertible Securities Trust (6).. 1,000,000 * 50,000 0
Nations Convertible Securities Fund 488,000 * 24,400 0
Ondeo Nalco........................ 60,000 * 3,000 0
Pioneer High Yield Fund............ 24,050,000 19.2 1,202,500 0
Pioneer High Yield VCT Portfolio... 200,000 * 10,000 0
Prudential Insurance Co. of America 100,000 * 5,000 0
St. Thomas Trading, Ltd............ 11,082,000 8.9 554,100 0
Starvest Combined Portfolio........ 330,000 * 16,500 0
State of Oregon/Equity............. 1,450,000 1.2 72,500 0
Syngenta AG........................ 80,000 * 4,000 0
UBS O'Connor LLC f/b/o UBS
Global Equity Arbitrage
Master Ltd........................ 2,000,000 1.6 100,000 0
Zeneca Holdings Trust.............. 120,000 * 6,000 0
Zurich Institutional Benchmarks
Masterfund, Ltd................... 1,008,000 * 50,400 0
Total.............................. 109,610,000 87.69% 5,480,500
Unnamed holders of notes or future
transferees, pledgees, donees or
successors of or from such unnamed
holders (7)....................... 15,390,000 12.31% 769,500
--------
* Less than 1%.
(1) Individuals and entities who receive shares of common stock covered by this
prospectus from a selling securityholder as a gift or in connection with a
pledge may sell up to 500 of those shares using this prospectus.
(2) Assumes conversion of the full amount of notes held by the selling
securityholder at the initial rate of approximately 50 shares of common
stock per $1,000 in principal amount of the notes. The conversion rate and
the number of shares of common stock issuable upon conversion of the notes
may adjust under circumstances described under "Description Of
Notes--Conversion of Notes." Accordingly, the number of shares of common
stock issuable upon conversion of the notes may increase or decrease from
time to time. Under the terms of the notes, cash will be paid instead of
issuing any fractional shares.
(3) Includes shares of common stock issuable upon conversion of the notes
beneficially owned by the selling securityholder. Assumes that the selling
securityholder has sold all the shares of common stock shown as being
issuable upon the assumed conversion of notes listed next to its name and
represents additional shares of common stock beneficially owned before the
offering.
(4) The Allstate Corporation ("Allstate") is the parent company of Allstate
Insurance Company, which is the parent company of Allstate Life Insurance
Company. Allstate Insurance Company beneficially owns 31,900 shares of
Axcelis common stock, Agents Pension Plan beneficially owns 5,300 shares of
Axcelis common stock and Allstate Retirement Plan beneficially owns 11,930
shares of Axcelis common stock. Allstate disclaims any intereset in
securities held by Agents Pension Plan and Allstate Retirement Plan.
(5) The entity is either an investment company or a portfolio of an investment
company registered under Section 8 of the Investment Company Act of 1940,
as amended, or a private investment account advised by Fidelity Management
& Research Company ("FMR Co."). FMR Co. is a Massachusetts corporation and
an investment advisor registered under Section 203 of the Investment
Advisors Act of 1940, as amended, and
23
provides investment advisory services to the Fidelity entity identified
above, and to other registered investment companies and to certain other
funds which are generally offered to a limited group of investors. FMR Co.
is a wholly-owned subsidiary of FMR Corp., a Massachusetts corporation.
(6) Morgan Stanley & Co., Incorporated ("Morgan Stanley & Co.") and Morgan
Stanley Dean Witter Convertible Securities Trust are affiliates. Morgan
Stanley & Co. served as one of the initial purchasers of the notes in
January 2002.
(7) Assumes that the unnamed holders of the notes or future transferees,
pledgees, donees or successors of or from any such unnamed holders do not
beneficially own any common stock other than the common stock issuable upon
conversion of the notes. No unnamed holder may use this prospectus to offer
or sell notes or shares of common stock until such unnamed holder is
identified as a selling securityholder in a supplement to this prospectus.
24
PLAN OF DISTRIBUTION
We are registering the notes and the shares of common stock issuable upon
conversion of the notes for resale by the selling securityholders listed in
this prospectus or in a supplement to this prospectus. These notes and these
shares of common stock may be sold from time to time to purchasers:
. directly by the selling securityholders; or
. through underwriters, broker-dealers or agents who may receive
compensation in the form of discounts, concessions or commissions from
the selling securityholders or the purchasers of the notes and the
underlying common stock.
The selling securityholders and any such broker-dealers or agents who
participate in the distribution of the notes and the underlying common stock
may be deemed to be "underwriters" (as this term is defined in the Securities
Act). As a result, any profits on the sale of the notes and the underlying
common stock by selling securityholders and any discounts, commissions or
concessions received by any such broker-dealers or agents might be deemed to be
underwriting discounts and commissions under the Securities Act. If the selling
securityholders were deemed to be underwriters, the selling securityholders may
be subject to statutory liabilities as underwriters under the Securities Act.
If the notes and the underlying common stock are sold through underwriters
or broker-dealers, the selling securityholders will be responsible for
underwriting discounts or commissions or agent's commissions.
The notes and the underlying common stock may be sold in one or more
transactions at:
. fixed prices;
. prevailing market prices at the time of sale or prices related to the
prevailing market prices;
. varying prices determined at the time of sale; or
. negotiated prices.
These sales may be effected in transactions:
. on any national securities exchange or quotation service on which the
notes and underlying common stock may be listed or quoted at the time of
the sale, including the Nasdaq National Market in the case of the common
stock;
. in the over-the-counter market;
. in transactions otherwise than on such exchanges or services or in the
over-the-counter market;
. through the writing of options, whether or not the options are listed on
an options exchange; or
. through the distribution of the securities by any selling securityholder
to its partners, members or stockholders.
These transactions may include block transactions or crosses. Crosses are
transactions in which the same broker acts as an agent on both sides of the
trade.
In connection with the sales of the notes and the underlying common stock or
otherwise, the selling securityholders may enter into hedging transactions with
broker-dealers. These broker-dealers may in turn engage in short sales of the
notes and the underlying common stock in the course of hedging their positions.
The selling securityholders may also sell the notes and the underlying common
stock short and deliver notes and the underlying common stock to close out
short positions, or loan or pledge notes and the underlying common stock to
broker-dealers that in turn may sell the notes and the underlying common stock.
25
To our knowledge, there are currently no plans, arrangements or
understandings between any selling securityholders and any underwriter,
broker-dealer or agent regarding the sale of the notes and the underlying
common stock by the selling securityholders. Selling securityholders may
refrain from selling any or all of the notes and the underlying common stock
offered by them pursuant to this prospectus. In addition, any such selling
securityholder may transfer, devise or gift the notes and the underlying common
stock by other means not described in this prospectus. To the extent required,
we will amend or supplement this prospectus to disclose material arrangements
regarding the plan of distribution.
Our common stock is quoted on the Nasdaq National Market under the symbol
"ACLS." The notes have been designated for trading in The Portal Market, a
subsidiary of The Nasdaq Stock Market, Inc. Any notes that are resold by means
of this prospectus will no longer be eligible for trading in The Portal Market.
We do not intend to apply for listing of the notes on any securities exchange
or for quotation through Nasdaq. Accordingly, no assurance can be given as to
the development of liquidity or any trading market for the notes.
There can be no assurance that any selling securityholder will sell any or
all of the notes or the underlying common stock by this prospectus. In
addition, any notes or shares of underlying common stock covered by this
prospectus that qualify for sale pursuant to Rule 144 or Rule 144A of the
Securities Act may be sold under Rule 144 or Rule 144A rather than pursuant to
this prospectus. The selling securityholders and any other person participating
in such distribution will be subject to the Exchange Act. The Exchange Act
rules include, without limitation, Regulation M, which may limit the timing of
purchases and sales of any of the notes and the underlying common stock by the
selling securityholders and any such other person. In addition, Regulation M of
the Exchange Act may restrict the ability of any person engaged in the
distribution of the notes and the underling common stock being distributed for
a period of up to five business days before the commencement of such
distribution. This may affect the marketability of the notes and the underlying
common stock and the ability of any person or entity to engage in market-making
activities with respect to the notes and the underlying common stock.
We have agreed to indemnify the selling securityholders against some
liabilities, including some liabilities under the Securities Act. We have
agreed to pay substantially all of the expenses incidental to the registration,
offering and sale of the notes and the underlying common stock to the public
other than commissions, fees and discounts of underwriters, broker-dealers and
agents.
LEGAL MATTERS
The validity of the notes and the common stock issuable upon conversion of
the notes will be passed upon for us by our counsel, Palmer & Dodge LLP,
Boston, Massachusetts.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule included in our Annual Report on Form 10-K
for the year ended December 31, 2001, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the registration
statement. Our financial statements and schedule are incorporated by reference
in reliance on Ernst & Young LLP's report, given on their authority as experts
in accounting and auditing.
26
WHERE YOU CAN FIND MORE INFORMATION
You may read and copy any reports, statements or other information that we
file with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549.
Please call the SEC at 1-800-SEC-0330 for further information on the Public
Reference Room. These SEC filings are also available to the public from
commercial document retrieval services and at the Internet world wide web site
maintained by the SEC at "http://www.sec.gov." Reports, proxy statements and
other information concerning us may also be inspected at the offices of The
Nasdaq Stock Market, which is located at 1735 K Street, N.W., Washington, D.C.
20006.
The SEC allows us to "incorporate by reference" information into this
prospectus, which means that we can disclose important information to you by
referring you to other documents filed separately with the SEC. The information
incorporated by reference is considered part of this prospectus, except for any
information superseded by information contained directly in this prospectus or
in later-filed documents incorporated by reference in this prospectus.
The following documents that we filed with the SEC are incorporated by
reference into this prospectus:
1. Our Annual Report on Form 10-K for the year ended December 31, 2001,
filed on March 12, 2002;
2. Our Quarterly Report on Form 10-Q for the period ended March 31, 2002,
filed on May 14, 2002;
3. The Proxy Statement on Schedule 14A for our 2002 Annual Meeting of
Stockholders filed on March 20, 2002; and
4. The description of the common stock contained in our Amended and
Restated Certificate of Incorporation filed with our Registration
Statement on Form S-1 (Registration No. 333-36330), including any
further amendment or report filed hereafter for the purpose of updating
such description.
We also incorporate by reference additional documents that we may file with
the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act between the
date of this prospectus and the date that we terminate this offering. These
include periodic reports, such as Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy
statements.
Documents incorporated by reference are available from us without charge.
You may obtain documents incorporated by reference in this prospectus by
requesting them in writing or by telephone from us at the following address and
telephone number: Mark Namaroff, Director, Investor Relations, Axcelis
Technologies, Inc., 55 Cherry Hill Drive, Beverly, Massachusetts 01915; (978)
787-4000.
You should rely only on the information contained or incorporated by
reference in this prospectus. We have not authorized anyone to provide you with
information that is different from what is contained in this prospectus. This
prospectus is dated , 2002. You should not assume that the information
contained in this prospectus is accurate as of any date other than that date.
Neither the delivery of this prospectus nor the sale of securities creates any
implication to the contrary.
27
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses to be borne by Axcelis in connection with the registration of
the notes and common stock are estimated as follows:
SEC Registration Fee........... $11,500
Printing and engraving expenses $25,000
Accounting fees and expenses... $15,000
Legal fees and expenses........ $30,000
Miscellaneous expenses......... $15,000
-------
Total....................... $96,500
=======
All of the above figures, except the SEC registration fee, are estimates.
The selling securityholders listed in the prospectus or any related prospectus
supplement will not bear any of the expenses listed above.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
We are incorporated under the laws of the State of Delaware. Section 145
("Section 145") of the General Corporation Law of the State of Delaware, as the
same exists or may hereafter be amended (the "General Corporation Law"), inter
alia, provides that a Delaware corporation may indemnify any persons who were,
are or are threatened to be made, parties to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of such corporation),
by reason of the fact that any such person is or was an officer, director,
employee or agent of such corporation, or is or was serving at the request of
such corporation as a director, officer, employee or agent of another
corporation or enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding, provided such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the corporation's best interests
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe that his conduct was illegal.
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
enterprise, against any liability asserted against him and incurred by him in
any such capacity, arising out of his status as such, whether or not the
corporation would otherwise have the power to indemnify him under Section 145.
Our Amended and Restated Certificate of Incorporation and Bylaws, as
amended, provide for the indemnification of officers and directors to the
fullest extent permitted by the General Corporation Law.
All of our directors and officers will be covered by insurance policies
maintained by us against specified liabilities for actions taken in their
capacities as such, including liabilities under the Securities Act of 1933, as
amended. In addition, we have entered into indemnity agreements with our
directors and executive officers that obligate us to indemnify such directors
and executive officers to the fullest extent permitted by the General
Corporation Law.
ITEM 16. EXHIBITS
The exhibits listed in the Exhibit Index immediately following the signature
page are filed with this registration statement.
II-1
ITEM 17. UNDERTAKINGS
(a)The undersigned Registrant hereby undertakes:
(1)To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i)To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii)To reflect in the prospectus any facts or events arising after the
effective date of this registration statement (or the most recent
post-effective amendment thereof) that, individually or in the
aggregate, represent a fundamental change in the information set
forth in this registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;
(iii)To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement
or any material change to such information in this registration
statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2)That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3)To remove from registration by means of a post-effective amendment any
of the securities being registered that remain unsold at the termination
of the offering.
(b)The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in
this registration statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(c)Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the provisions referred to in Item 15 hereof or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Beverly, Commonwealth of Massachusetts, as of May
16, 2002.
AXCELIS TECHNOLOGIES, INC.
By:
/s/ CORNELIUS F. MOSES, III
-------------------------------
Cornelius F. Moses, III
Executive Vice President and Chief
Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated:
Signature Title Date
--------- ----- ----
* Chairman of the Board May 16, 2002
-----------------------------
Stephen R. Hardis
* President and May 16, 2002
----------------------------- Chief Executive Officer
Mary G. Puma (Principal Executive Officer)
* Executive Vice President and May 16, 2002
----------------------------- Chief Financial Officer
(Principal Financial Officer
and
Cornelius F. Moses, III Principal Accounting Officer)
* Director May 16, 2002
-----------------------------
Alexander M. Cutler
* Director May 16, 2002
-----------------------------
Gary L. Tooker
* Director May 16, 2002
-----------------------------
Ned C. Lautenbach
II-3
Signature Title Date
--------- ----- ----
* Director May 16, 2002
-----------------------------
Philip S. Paul
* Director May 16, 2002
-----------------------------
Patrick H. Nettles
* Director May 16, 2002
-----------------------------
Naoki Takahashi
* Director May 16, 2002
-----------------------------
H. Brian Thompson
*By /S/ LYNNETTE C. FALLON
--------------------------
Lynnette C. Fallon
Attorney-in-fact
II-4
EXHIBIT INDEX
No. Description
4.1 Amended and Restated Certificate of Incorporation of the Company.
Incorporated by reference from Exhibit 3.1 of the Company's Registration
Statement on Form S-1 (Registration No. 333-36330).
4.2 Bylaws of the Company, as amended. Incorporated by reference from Exhibit
3.2 of the Company's Current Report on Form 10-K filed March 12, 2002
(File No. 000-30941).
4.3 Specimen stock certificate. Incorporated by reference from Exhibit 4.1 of
the Company's Registration Statement on Form S-1 (File No. 333-36330).
4.4 Rights Agreement between the Company and EquiServe Trust Company, N.A.
Incorporated by reference from Exhibit 4.1 of the Company's Registration
Statement on Form S-1 (File No. 333-36330).
4.5 Indenture between the Company and State Street Bank and Trust Company, as
Trustee, including the form of note, dated as of January 15, 2002.
Incorporated by reference from Exhibit 4.1 of the Company's Current Report
on Form 8-K filed January 15, 2002 (File No. 000-30941).
4.6 Registration Rights Agreement by and among the Company, Morgan Stanley &
Co. Incorporated, Salomon Smith Barney Inc. and SG Cowen Securities
Corporation, dated as of January 15, 2002. Incorporated by reference from
Exhibit 4.2 of the Company's Current Report on Form 8-K filed January 15,
2002 (File No. 000-30941).
5 Opinion of Palmer & Dodge LLP. Previously filed.
12 Statements regarding Computation of Ratio of Earnings to Fixed Charges.
Filed herewith.
23.1 Consent of Ernst & Young LLP, independent auditors to the Company. Filed
herewith.
23.2 Consent of Palmer & Dodge LLP (contained in Exhibit 5 hereto).
24 Power of Attorney. Previously filed.
25 Statement of Eligibility and Qualification under the Trust Indenture Act of
1939, as amended, on Form T-1 of State Street Bank and Trust Company.
Previously filed.