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Axcelis Technologies Inc (NASDAQ:ACLS) has failed to make a payment required under the company’s 4.25% Convertible Senior Subordinated Notes. The company was required to repay the outstanding principal amount of the notes plus a maturity premium and accrued interest (a total payment of approximately $85 million) on January 15. The failure constitutes an event of default under the notes. As a result of the failure to make the required payment, ACLS must pay the entire overdue amount, plus interest at a rate of 8.0% per annum, plus certain additional costs and expenses associated with the collection of such amounts.

The company attached the following press release to its announcement:

Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced that it is continuing to engage in negotiations on financing and strategic alternatives that will serve the best interests of the company following a missed payment on Convertible Senior Subordinated Notes that was due on January 15, 2009. The payment consisted of the outstanding principal on $75 million of 4.25% Convertible Senior Subordinated Notes plus a maturity premium of 11.125% and accrued interest for a total of approximately $85 million. As such, Axcelis is continuing discussions with its note holder as well as other lenders.

Axcelis emphasized that it is highly focused on preserving the company’s financial health, including aggressively reducing expenses.

Like a number of companies impacted by the freeze up in the global credit markets, Axcelis has been hindered in the refinancing of its debt. Axcelis’ efforts in this regard also have been impacted by the protracted decline in the semiconductor industry and the discussions with Sumitomo Heavy Industries, Ltd. regarding an acquisition of Axcelis last year, among other factors.