AMENDMENT NO. 3 TO LOAN AND SECURITY AGREEMENT
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AMENDMENT NO. 3 TO LOAN AND SECURITY AGREEMENT (this "AMENDMENT") dated as
of February 2, 2005 by and among The GSI Group, Inc., a Delaware corporation
("BORROWER"), Assumption Leasing Company, Inc., an Illinois corporation the
"GUARANTOR"), the lenders ("LENDERS") from time to time party to the Loan
Agreement (as defined below) and Congress Financial Corporation (Central), an
Illinois corporation, in its capacity as agent for Lenders (in such capacity,
"AGENT").
R E C I T A L S:
WHEREAS, Agent, the Lenders, Borrower and Guarantor are parties to that
certain Loan and Security Agreement dated as of October 31, 2003 (as amended,
the "Loan Agreement"; capitalized terms used and not defined herein shall have
the meanings assigned to them in the Loan Agreement, as amended hereby);
WHEREAS, Borrower and Guarantors have requested that the Agent and Lenders agree
to a certain amendment as set forth herein to permit the Borrower to make a
dividend to its shareholders; and
WHEREAS, Agent and the Lenders have granted their approval to such amendment
upon the terms and conditions contained herein,
NOW, THEREFORE, in consideration of the premises contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
Section 1. Amendment to Loan Agreement. Immediately upon the satisfaction
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of each of the applicable conditions precedent set forth in Section 2 of this
Amendment, the following amendment to the Loan Agreement shall become effective
as of the date hereof:
(a) Section 9.11 of the Loan Amendment is hereby amended by amending
and restating clause (d) of Section 9.11 to read as follows:
"(d) Borrower may (i) make a one time repurchase of 948,052 shares of
its common stock from Xxxxx Xxxxx on or prior to July 31, 2004 with proceeds
from the Term Loan as described in Section 2.3(a); provided, that with respect
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to this clause (i), (A) no Event of Default has occurred and is continuing
immediately before, and immediately after giving effect to, such repurchase and
(B) Borrower is in compliance with Section 10.12 of the Indenture at the time
of, and after giving effect to, such dividend, (ii) pay dividends in any
calendar month (other than in respect of any calendar month during the 2005
calendar year), to the extent permitted by applicable law, in an aggregate
amount of up to $83,333 in any calendar month; provided, that with respect to
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this clause (ii), (A) no Event of Default has occurred and is continuing
immediately before, and immediately after giving effect to, such dividend and
(B) Borrower is in compliance with Section 10.12 of the Indenture at the time
of, and after giving effect to, such dividend, (iii) in addition to any
dividends permitted under clause (ii) above, pay additional dividends once each
calendar year (other than the 2005 calendar year), to the extent permitted by
applicable law, in an aggregate amount of up to $1,000,000 in any such calendar
year; provided, that with respect to this clause (iii), (A) such dividend is
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payable only once per calendar year, commencing on December 15, 2004 and on each
anniversary thereof (other than the 2005 calendar year), (B) no Event of Default
has occurred and is continuing immediately before, and immediately after giving
effect to, such dividend, (C) Borrower is in compliance with Section 10.12 of
the Indenture at the time of, and after giving effect to, such dividend and (D)
Borrower has Excess Availability of at least $10,000,000 after giving effect to
such dividend and (iv) pay dividends in an amount not to exceed $2,000,000 on or
about February 4, 2005, to the extent permitted by applicable law; provided,
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that with respect to this clause (iv), (A) no Event of Default has occurred and
is continuing immediately before, and immediately after giving effect to, such
dividend, (B) Borrower is in compliance with Section 10.12 of the Indenture at
the time of, and after giving effect to, such dividend and (C) Borrower has
Excess Availability of at least $10,000,000 after giving effect to such
dividend. Upon the making of any dividend under clause (iii) or clause (iv)
above, Borrower shall maintain Excess Availability of at least $10,000,000 for a
period of thirty (30) consecutive days commencing on the date of such dividend."
Section 2. Conditions to Effectiveness of Amendment. This Amendment shall
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be effective upon satisfaction of the following conditions precedent:
2.1. This Amendment shall have been executed and delivered by Agent,
the Lenders, Borrower and Guarantor;
2.2. The representations and warranties contained herein shall be true and
correct in all respects;
2.3. Agent shall have received a duly executed Acknowledgment and Consent
from the Guarantor; and
2.4. Agent shall have received a certificate from the chief financial
officer of the Borrower certifying, and setting forth appropriate calculations
reflecting, that the payment of the $2,000,000 dividend on February 4, 2005 as
contemplated by Section 9.11 of the Loan Agreement (as amended hereby) complies
with the requirements of Section 10.12 of the Indenture.
Section 3. Representations and Warranties. In order to induce the Agent and
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Lenders to enter into this Amendment, each of Borrower and Guarantor represents
and warrants to Agent and the Lenders, upon the effectiveness of this Amendment,
which representations and warranties shall survive the execution and delivery of
this Amendment that:
3.1. No Default; etc. No Event of Default and no event or condition
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which, merely with notice or the passage of time or both, would constitute an
Event of Default, has occurred and is continuing after giving effect to this
Amendment or would result from the execution or delivery of this Amendment or
the consummation of the transactions contemplated hereby.
3.2. Corporate Power and Authority: Authorization. Each of Borrower and
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Guarantor has the corporate power and authority to execute and deliver this
Amendment and the execution and delivery by Borrower and Guarantor of this
Amendment has been duly authorized by all requisite corporate action by Borrower
or such Guarantor.
3.3. Execution and Delivery. Each of Borrower and Guarantor has duly
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executed and delivered this Amendment.
3.4. Enforceability. This Amendment constitutes the legal, valid and
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binding obligation of Borrower and Guarantor, enforceable against Borrower and
Guarantor in accordance with its respective terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' right generally, and by general
principles of equity.
3.5. Representations and Warranties. All of the representations and
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warranties contained in the Loan Agreement and in the other Financing Agreements
(other than those which speak expressly only as of a different date) are true
and correct as of the date hereof after giving effect to this Amendment.
Section 4. Miscellaneous.
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4.1. Effect; Ratification. Each of Borrower and Guarantor acknowledges
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that all of the reasonable legal expenses incurred by Agent and Lenders in
connection herewith shall be reimbursable under Section 9.20 of the Loan
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Agreement. The amendments set forth herein are effective solely for the
purposes set forth herein and shall be limited precisely as written, and shall
not be deemed to (i) be a consent to any amendment, waiver or modification of
any other term or condition of the Loan Agreement or of any other Financing
Agreement except as provided herein or (ii) prejudice any right or rights that
Agent or any Lender may now have or may have in the future under or in
connection with the Loan Agreement or any other Financing Agreement. Each
reference in the Loan Agreement to "this Agreement," "herein," "hereof" and
words of like import and each reference in the other Financing Agreements to the
"Loan Agreement" shall mean the Loan Agreement as amended hereby. This
Amendment shall be construed in connection with and as part of the Loan
Agreement and all terms, conditions, representations, warranties, covenants and
agreements set forth in the Loan Agreement and each other Financing Agreement,
except as waived herein are hereby ratified and confirmed and shall remain in
full force and effect.
4.2. Counterparts. This Amendment may be executed in any number of
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counterparts, each such counterpart constituting an original but all together
one and the same instrument.
4.3. Governing Law. This Amendment shall be governed by, and construed
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and interpreted in accordance with, the internal laws of the State of Illinois.
[Signature Page Follows]
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[Signature Page to Amendment No. 3 to Loan and Security Agreement]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 3
to Loan and Security Agreement as of the date first above written.
BORROWER:
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THE GSI GROUP, INC.
By:
Name:
Title
GUARANTOR:
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ASSUMPTION LEASING COMPANY, INC.
By:
Name:
Title
AGENT:
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CONGRESS FINANCIAL CORPORATION (CENTRAL)
By:
Name:
Title
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REVOLVING LENDERS:
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CONGRESS FINANCIAL CORPORATION (CENTRAL)
By:
Name:
Title
FLEET CAPITAL CORPORATION
By:
Name:
Title
TERM LENDERS:
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ABLECO FINANCE LLC, on behalf of itself
and its affiliate assigns
By:
Name:
Title
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Acknowledgement and Consent
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The undersigned has heretofore executed and delivered to Agent and the
Lenders that certain Guaranty Agreement dated as of October 31, 2003 (the
"Guaranty") in favor of Agent for the benefit of Lenders. The undersigned
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hereby consents to the Amendment No. 3 to the Loan and Security Agreement dated
as of February __, 2005 set forth above ("Amendment") and confirms that the
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Financing Agreements executed and delivered by it and all of the obligations of
such undersigned thereunder remain in full force and effect. The undersigned
acknowledges and agrees that, notwithstanding the execution and delivery of the
Amendment, the Guaranty executed and delivered by such undersigned to the Agent
remains in full force and effect and the rights and remedies of the Agent and
the Lenders thereunder and the obligations of such undersigned thereunder remain
in full force and effect and shall not be affected, impaired or discharged
hereby. The undersigned acknowledges and agrees that the consent of such
undersigned to any further waivers, consents or amendments to the Loan Agreement
shall not be required as a result of this waiver having been obtained. The
undersigned further acknowledges that the Agent and the Lenders are relying on
the assurance set forth herein in extending and maintaining credit outstanding
to the Borrower.
GUARANTOR:
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ASSUMPTION LEASING COMPANY, INC.
By:
Name:
Title
