EXHIBIT 10.5
AMENDMENT AGREEMENT NUMBER FIVE
TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT AGREEMENT NUMBER FIVE TO LOAN AND SECURITY AGREEMENT (this
"Amendment"), dated as of December 20, 2001, is entered into between and among,
on the one hand U.S. BANK NATIONAL ASSOCIATION, as a lender and as the arranger
and administrative agent ("Agent") for the lenders that become members of the
Lender Group pursuant to the terms of the Agreement (as that term is defined
below) (such lenders, together with their respective successors and assigns, are
referred to hereinafter each individually as a "Lender" and collectively as the
"Lenders"), and, on the other hand, 3D SYSTEMS CORPORATION, a Delaware
corporation ("Parent"), and each of Parent's Subsidiaries identified on the
signature pages hereof (such Subsidiaries, together with Parent, are referred to
hereinafter each individually as a "Borrower," and individually and
collectively, jointly and severally, as the "Borrowers") and amends that certain
Loan and Security Agreement, dated as of May 21, 2001, between and among Agent
and Borrowers, as amended by that certain Amendment Agreement Number One to Loan
and Security Agreement, dated July 26, 2001, that certain Amendment Agreement
Number Two to Loan and Security Agreement, dated August 16, 2001, that certain
letter agreement, dated August 30, 2001, that certain Amendment Agreement Number
Three to Loan and Security Agreement, dated October 1, 2001, and that certain
Amendment Agreement Number Four to Loan and Security Agreement, dated as of
November 1, 2001 (as amended, the "Agreement"). All terms which are defined in
the Agreement shall have the same definition when used herein unless a different
definition is ascribed to such term under this Amendment, in which case, the
definition contained herein shall govern. This Amendment is entered into in
light of the following facts:
RECITALS
WHEREAS, Borrowers have requested that Lenders agree (i) to the issuance by
Parent of convertible subordinated debentures in the aggregate principal amount
of $10,000,000, (ii) to change the maximum amount of the Credit Facility to be
allocated to Agent, as a lender, for the purposes of determining if there has
been a successful syndication, (iii) to change the Senior Debt to EBITDA Ratio
and the Leverage Ratio, and (iv) to extend the deadline for Borrowers to
complete certain unsatisfied conditions subsequent contained in the Agreement.
WHEREAS, Lenders have agreed to Borrowers' requests on the condition that
Borrowers agree to a permanent reduction in the Maximum Revolver Amount and to
the other terms and conditions contained in this Amendment.
WHEREAS, Borrowers have agreed to a permanent reduction in the Maximum
Revolver Amount and to the other terms and the conditions required by Lenders.
NOW, THEREFORE, the parties agree as follows:
1. The definitions of DOMESTIC ACCOUNT and MAXIMUM REVOLVER AMOUNT
contained in SECTION 1.1 of the Agreement are deleted in their entirety and are
replaced with new definitions of DOMESTIC ACCOUNT and MAXIMUM REVOLVER AMOUNT as
follows:
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"DOMESTIC ACCOUNT" means an Account which is not a Foreign Account.
"MAXIMUM REVOLVER AMOUNT" means (i) $26,500,000 from the Closing Date
up to and in including January 31, 2002, (ii) $21,500,000 from
February 1, 2002, up to and including April 30, 2002, and (iii)
$18,500,000 from May 1, 2002, up to and including the Maturity Date.
2. SECTION 1.1 of the Agreement is amended by adding a new definition of
"Permitted Debentures" as follows:
"PERMITTED DEBENTURES" means convertible subordinated debentures, in
an aggregate principal amount of $10,000,000, issued or to be issued
by Parent, and which are in the form of EXHIBIT P-1.
3. The first sentence of SECTION 2.1(A) of the Agreement is deleted in its
entirety and is replaced with a new first sentence as follows:
Subject to the terms and conditions of this Agreement, (i) from and
after the closing of the Tender Offer through January 31, 2002, each
Lender with a Revolver Commitment shall make advances (collectively,
the "Advances") to Borrowers of its Pro Rata Share of the amount
required to finance Borrowers' financial obligations arising in
connection with the consummation of the Tender Offer, the Merger, and
the other transactions contemplated by the Merger Agreement and the
Merger, as well as any other use of proceeds permitted under SECTION
7.17; provided, however, that the aggregate outstanding amount of all
such Advances shall not exceed the lesser of (1) the Maximum Revolver
Commitment, and (2) the amount that would be calculated as the
Borrowing Base (as defined below) if the accounts of the Foreign
Subsidiaries were deemed assets of Borrowers and (ii) commencing on
February 1, 2002 and at all times thereafter during the first 3 years
of the term of this Agreement, each Lender with a Revolver Commitment
agrees (severally, not jointly or jointly and severally) to make
additional Advances to Borrowers in an amount at any one time
outstanding not to exceed such Lender's Pro Rata Share of an amount
equal to THE LESSER OF (i) the Maximum Revolver Amount LESS the amount
of the outstanding Advances, LESS the Letter of Credit Usage and LESS
the Foreign Exchange Reserve, or (ii) the Borrowing Base LESS the
amount of the outstanding Advances, less the Letter of Credit Usage
and LESS the Foreign Exchange Reserve.
4. The second sentence of SECTION 2.5 of the Agreement is deleted in its
entirety and is replaced with a new second sentence as follows:
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The preceding sentence shall not apply to that portion of the
Overadvances, if any, that arises between the Closing Date and
February 1, 2002, which would be eliminated if the accounts of the
Foreign Subsidiaries arising from the sale of goods or rendition of
services were deemed to be Accounts of the Borrowers.
5. The last sentence of SECTION 2.16 is deleted in its entirety and is
replaced with the following:
Furthermore, as used herein a "successful syndication" means that
after the completion of the general syndication, Bank shall be
allocated no more than Twenty Eight Million Five Hundred Eighty Five
Thousand Dollars ($28,585,000) as of January 31, 2002, and no more
than Twenty Six Million Two Hundred Thirty Thousand Dollars
($26,230,000) as of April 30, 2002, and at all times thereafter.
6. SECTION 3.2(B) of the Agreement is deleted in its entirety and is
replaced with the following:
(b) on or before January 31, 2002, deliver to Agent the duly executed
Control Agreements, and each such Control Agreement shall be in full
force and effect;
7. SECTION 3.2(F) of the Agreement is deleted in its entirety and is
replaced with the following:
(f) on or before January 31, 2002, deliver to Agent such Collateral
Access Agreements from lessors, warehousemen, bailees, and other third
persons as Agent may require in its Permitted Discretion.
8. SECTION 3.2(H) of the Agreement is deleted in its entirety and is
replaced with the following:
(h) on or before January 31, 2002, all information and opinions
reasonably required by Agent's United Kingdom counsel in order to
issue an opinion reasonably satisfactory to Agent shall have been
delivered by Borrowers to Agent's United Kingdom counsel.
9. SECTION 7.1 of the Agreement is amended by adding a new subpart (f) as
follows:
(f) Indebtedness evidenced by the Permitted Debentures.
10. SECTION 7.8(A) of the Agreement is deleted in its entirety and is
replaced with the following:
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(a) Except in connection with a refinancing permitted by SECTION
7.1(D) and the conversion of the Indebtedness evidenced by the
Permitted Debentures into common stock of Borrower pursuant to the
terms of the Permitted Debentures, prepay, redeem, defease, purchase,
or otherwise acquire any Indebtedness of Borrower, other than the
Obligations in accordance with this Agreement, and
11. SECTION 7.20(A)(I) of the Agreement is deleted in its entirety and is
replaced with the following:
SENIOR DEBT TO EBITDA RATIO. A Senior Debt to EBITDA Ratio of not more
than of 2.5:1, for each of those fiscal quarters during the term of
this Agreement commencing with the fiscal quarter ending June 30,
2001, and concluding with the fiscal quarter ending September 30,
2002, and a Senior Debt to EBITDA Ratio of not more that 2.0:1 for
each fiscal quarter commencing with fiscal quarter ending December 31,
2002, and for each fiscal quarter thereafter for the remaining term of
this Agreement.
12. SECTION 7.20(A) of the Agreement is amended by adding a new subpart
(vii) as follows:
MAXIMUM LEVERAGE RATIO. A Leverage Ratio of not more than of 3.5:1,
for each of those fiscal quarters during the term of this Agreement
commencing with the fiscal quarter ending June 30, 2001, and
concluding with the fiscal quarter ending September 30, 2001, and a
Leverage Ratio of not more that 3.0:1 for each fiscal quarter
commencing with the fiscal quarter ending December 31, 2001, and for
each fiscal quarter thereafter for the remaining term of this
Agreement.
13. SECTION 8.14 of the Agreement is deleted in its entirety and is
replaced with a new SECTION 8.14 as follows:
If on February 1, 2002, the Borrowers are not in compliance with the
Borrowing Base or have Overadvances and such non-compliance or
Overadvances are not cured by February 2, 2002, pursuant to Section
9.2; or
14. This Amendment shall be deemed effective as of the date first
hereinabove written and shall have no retroactive effect whatsoever. Except as
specifically amended herein, the Agreement shall remain in full force and effect
without any other changes, amendments or modifications.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the date first above written.
3D SYSTEMS CORPORATION,
a Delaware corporation as Administrative
Borrower and as a Borrower
By: /S/ E. XXXXX XXXXXX
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Title: CFO
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3D SYSTEMS, INC.,
a California corporation as a Borrower
By: /S/ E. XXXXX XXXXXX
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Title: CFO
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3D CAPITAL CORPORATION,
a California corporation, as a Borrower
By: /S/ E. XXXXX XXXXXX
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Title: CFO
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U.S. BANK NATIONAL ASSOCIATION,
as Agent and as a Lender
By: /S/ XXXXXXX X. XXX
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Xxxxxxx X. Xxx, Vice President
UNITED CALIFORNIA BANK,
as a Lender
By: /S/ XXXXX X. XXXXXX
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Title: VICE PRESIDENT
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REAFFIRMATION OF GUARANTY
The undersigned has executed a Continuing Guaranty ("Guaranty") in favor of
Lenders respecting the obligations of Borrowers owing to Lenders. The
undersigned acknowledges the terms of the above Amendment and reaffirms and
agrees that the Guaranty remains in full force and effect; nothing in such
Continuing Guaranty obligates Lenders to notify the undersigned of any changes
in the financial accommodations made available to Borrowers or to seek
reaffirmations of the Guaranty; and no requirement to so notify the undersigned
or to seek reaffirmations in the future shall be implied by the execution of
this reaffirmation.
3D HOLDINGS, LLC,
a Delaware limited liability company
By: /S/ E. XXXXX XXXXXX
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Title: CFO
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