EXHIBIT 4.16
AMENDMENT TO THE LETTER AGREEMENT ,INCLUDING THE
SCHEDULE - STANDARD CREDIT TERMS
FOR CANADIAN IMPERIAL BANK OF COMMERCE
This Amendment is entered into this 12th day of August, 2002 and modifies the
June 28, 2002 letter from Canadian Imperial Bank of Commerce ("CIBC") to ▇▇▇▇▇▇
▇. ▇▇▇▇▇ of GSI Lumonics Inc. ("Letter") and the attachment to such letter
entitled "Schedule - Standard Credit Terms" ("Attachment")(collectively the
Letter and the Attachment shall be known as the Letter Agreement"). In the event
of a conflict between the Letter Agreement and this Amendment, the terms of this
Amendment shall prevail and govern.
Notwithstanding anything to the contrary in the Letter Agreement, the parties
hereby agree as follows:
That the following modifications shall be made to the Letter:
1) The paragraph in the Letter entitled "Overall Credit Limit" shall be
replaced with the following: "The total use of all Credit shall not at any time
exceed the lesser of (a) Cdn $6,145,000 or (b) the US$ equivalent of the
Cdn$6,145,000. All other limits set forth in this letter which do not
specifically identify a currency shall be deemed to be stated in Canadian
dollars."
2) The paragraph in the Letter entitled "Credit A: Operating Line" shall be
modified in the Description and Rate subpart "(1) Canadian dollar loans and
overdrafts" by deleting "Stand by Fee: 5 basis points on any unused credit
availment".
3) The paragraph in the Letter entitled "Security" shall be replaced in its
entirety with the following:
Security: The following security is required.
Liquid: Liquid security as follows:
. Pledged Collateral in the form of Money Market
Investments, as follows:
For the full amount of all facilities
availed, presently $6,145,000 value, to be
held by and pledged as collateral to CIBC.
4) The paragraph in the Letter entitled "Reporting Requirements" shall be
modified by replacing subpart (3) with the following: "(2) Within 120
days of each fiscal year end, a business plan or forecast for the next
fiscal year including projected balance sheets, income statements and
cash flow projections."
5) The paragraph in the Letter entitled "Other Provisions" shall be
modified by replacing the "Interest Rate Applicable to Credit Limit
Excesses" to "CIBC's
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standard Interest Rate Applicable to Credit Limit Excesses which shall
in no event exceed 21% per year."
6) The paragraph in the Letter entitled "Other Provisions" shall be
modified further in the subpart entitled "Next Scheduled Review Date"
by replacing the last sentence therein with the following: "The terms
of this Agreement will continue beyond May 31, 2003 until (a) a new
Agreement is executed between the parties which supercedes this
Agreement; (b) an Amendment to this Agreement is executed between the
parties, which terms and conditions shall govern the continued
existence of the Agreement; or (c) you notify us in writing, with
appropriate advance notice, of your desire to terminate the Agreement
on a specified date."
7) The paragraph entitled "Standard Credit Terms" shall be replaced in its
entirety with the following: "The attached Schedule - Standard Credit
terms, as modified by this Amendment, forms part of the Letter and the
Agreement.
8) The last sentence in the Letter shall be replaced with the following:
"The Agreement and this Amendment thereto was agreed to and became
effective on June 28, 2002, subject only to the execution by both
parties of the Letter Agreement and this Amendment thereto. As of June
28, 2002, this Agreement and Amendment replaced the existing credit
agreement dated December 31, 1999 between GSI Lumonics Inc. and CIBC,
and all covenants, warranties and obligations under the December 31,
1999 credit agreement terminated as of the June 28, 2002 effective date
and any outstanding amounts and security under the December 31, 1999
credit agreement as of June 28, 2002 are covered and governed by the
terms of the Letter Agreement and this Amendment."
That the following modifications shall be made to the "Schedule - Standard
Credit Terms" Attachment to the Letter:
a) Paragraph 1.1 (a) and (b) shall be replaced with:
1.1(a) for amounts above the Credit Limit of a Credit or part of a
Credit or the Overall Credit Limit, as described in Section 1.4, or for
amounts that are not paid when due, the CIBC standard Interest Rate
Applicable to Credit Limit Excesses, which shall in no event exceed 21%
per year.
1.1(b) for any other amounts the rate is the Prime Rate.
b) Paragraph 1.3, Payment of Interest, shall be replaced in its entirety
with the following: "Interest is computed on the basis of a 365-day
year, for the actual number of days elapsed. Interest is due monthly in
arrears commencing on the first day of the first month next succeeding
the date of last signature of this Amendment at the rates set forth
above. Unless you have made other
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arrangements with us, we will automatically debit your Operating Account
for interest amounts owing.
b) Paragraph 1.6 shall be deleted in its entirety and replaced with the
following:
Each party understands that the credit facilities provided hereunder
are initially being established as Demand Credits, and as such, CIBC
may, at its discretion, demand immediate repayment of any outstanding
amounts under any Demand Credit. Whenever possible, CIBC will give you
thirty (30) days notice of such action. Notwithstanding the foregoing,
CIBC agrees, on or before August 30, 2002, to convert the credit
facility to a Revolving Credit facility and to convert any Demand
Credits to non-demand credits under the Revolving Credit facility at no
cost to you. You agree to sign any documentation reasonably requested
by CIBC to effect such conversion.
c) The following paragraphs shall be deleted in their entirety:
. Paragraph 1.10, Insurance
. Paragraph 1.11, Environmental
. Paragraph 1.16, Confidentiality
d) Paragraph 1.13, Our Pricing Policy, shall be replaced in its entirety
with the following: "If you cancel any of the fixed instrument
arrangements under this Agreement, you will have to pay, on the used
and outstanding portions of such fixed instrument arrangement, the
standard and reasonable CIBC breakage fees we charge (and notify you
of) for such cancellation.
e) Paragraph 1.14, Proof of Debt, shall be modified by replacing the
second sentence with the following: "Throughout the time that we
provide you credit under this Agreement, our and your loan accounting
records will provide proof of the terms and conditions of your credit
(such as principal loan balances, interest calculations and payment
dates)."
f) Paragraph 1.15, Renewals of this Agreement, shall be replaced in its
entirety with the following:
"This Agreement shall remain in effect until May 31, 2003, at which
time CIBC shall review your financial statements, your forecast
business and financial plans and your compliance with the terms of this
Agreement. The terms of this Agreement will continue beyond May 31,
2003 until (a) a new Agreement is executed between the parties which
supercedes this Agreement; (b) an Amendment to this Agreement is
executed between the parties, which terms and conditions shall govern
the continued existence of the Agreement; or (c) you notify us in
writing, with appropriate advance notice, of your desire to terminate
the Agreement on a specified date."
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g) Paragraph 1.19, Notices shall be replaced with the following: "Except
as is otherwise expressly specified herein, you and CIBC may give any
notice in person or by telephone or by letter that is sent by fax or by
mail."
The Letter Agreement and this Amendment thereto constitutes the entire
understanding between the parties hereto with respect to the subject matter
hereof and merges all prior discussions between them relating thereto. Any
finding that a provision of this Agreement is invalid or unenforceable shall
apply only to such provision. Where a party executes this Agreement and Faxes it
to the other party, such other party may rely on the facsimile copy of this
Agreement as if it was an original document.
The Letter Agreement and this Amendment thereto shall be governed by the
applicable laws of the Commonwealth of Massachusetts.
In Witness Whereof, the parties hereby agree to amend the Letter Agreement in
accordance with the terms of this Amendment, as evidenced by their respective
signatures set out below.
GSI LUMONICS, INC. CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇
Title: V.P. & CFO Title: Associate Manager
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