EXHIBIT 10.2
AMENDMENT AGREEMENT NUMBER TWO
TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT AGREEMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT (this
"Amendment"), dated as of August 16, 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, between Agent, on the one hand, and
Borrowers, on the other hand (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, subsequent to the execution of the Agreement, Agent and Borrowers
have agreed that certain technical corrections are required to the definition of
Eligible Accounts and the Fixed Charge Coverage Ratio, and certain conditions
precedent need to be changed into conditions subsequent;
WHEREAS, the completion of the Tender Offer and Merger was delayed for a
period in excess of two months, causing a delay in the Closing Date and
requiring that certain dates contained in the Loan Agreement be adjusted;
NOW, THEREFORE, the parties agree as follows:
1. The reference to SECTION 9.3 in the definition of "Additional
Collateral" contained in Section 1.1 of the Agreement is deleted and is replaced
with a reference to SECTION 9.2.
2. The definition of "Accounts" contained in SECTION 1.1 is deleted in its
entirety and shall be replaced with a new definition of "Accounts" as follows:
"ACCOUNTS" means all of Borrowers' now owned or hereafter acquired right,
title, and interest with respect to "accounts" (as that term is defined in
the Code), and any and all supporting obligations in respect thereof;
provided, however, that to the extent a Foreign Subsidiary has executed a
Foreign Subsidiary Guaranty and the accounts of such Foreign Subsidiary
have become Additional Collateral, then such accounts of the Foreign
Subsidiary, so long as they are Additional Collateral, and any and
supporting obligations in respect thereof, shall be deemed included in the
term "Accounts".
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3. The definition of "Borrower" and "Borrowers" is deleted in its entirety
and shall be replaced with new definitions of "Borrower" and "Borrowers" as
follows:
"BORROWER" AND "BORROWERS" have the respective meanings set forth in the
introductory paragraph to this Agreement; provided, however, that to the
extent a Foreign Subsidiary has executed a Foreign Subsidiary Guaranty,
then so long as such Foreign Subsidiary Guaranty remains in effect, the
Foreign Subsidiary shall be deemed a Borrower for all purposes under this
Agreement.
4. New definition of "Divestiture Assets", "Final Judgment" and "RP Assets"
are added to SECTION 1.1 as follows:
"DIVESTITURE ASSETS" means (1) a perpetual, assignable, transferable, fully
paid-up (except as permitted by Section IV(E) of the Final Judgment),
non-exclusive license (without the right to sublicense, except for
establishing distribution and contracting out manufacturing) under the RP
Patents (as that term is defined in the Final Judgment) to develop, test,
produce, market, sell, or distribute, or to supply any support or
maintenance services for, products for use only in the field of either (but
not both) the SL Technology (as that term is defined in the Final Judgment)
or the LS Technology (as that term is defined in the Final Judgment), which
technology shall be the technology currently used by the Acquirer (as that
term is defined in the Final Judgment) to manufacture RP Industrial
Equipment (as that term is defined in the Final Judgment) (the "Selected
Technology"); and (2) the RP Assets.
"FINAL JUDGMENT" means the Final Judgment issued on August 16, 2001 in
connection with the civil action No. 1:00XX00000(GK) commenced in the
United States District Court for the District of Columbia and captioned
United States of America v. 3D Systems Corporation and DTM Corporation.
"RP ASSETS" means (1) a list of all North American (as that term is defined
in the Final Judgment) purchasers of RP Industrial Equipment from 3D
Systems, Inc. ("3D"), if the Selected Technology is SL Technology, or from
DTM Corporation ("DTM"), if the Selected Technology is LS Technology; (2)
all software copyright licenses needed by Acquirer to purchase and resell
both 3D's and DTM's used RP Industrial Equipment in North America, and (3)
at the option of the Acquirer, DTM's plant located at 0000 Xxxxxxx Xxxxxx,
Xxxx. 0, Xxxxxx, Xxxxx.
5. Clause (a) of the definition of "Eligible Accounts" contained in SECTION
1.1 of the Agreement is deleted in its entirety and is replaced with a new
clause (a) as follows:
(a) Domestic Accounts that have selling terms of more than 90 days or the
Account Debtor has failed to pay (i) within 60 days of original invoice due
date or (ii) within 90 days of the date of the original invoice,
6. 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:
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Subject to the terms and conditions of this Agreement, (i) from and after
the closing of the Tender Offer through December 31, 2001, 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 assets
of DTM Corporation and the accounts of the Foreign Subsidiaries were deemed
assets of Borrowers and (ii) commencing on January 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.
7. SECTION 2.1 of the Agreement is amended by providing that for the seven
(7) day period commencing on the Closing Date, the accounts of DTM Corporation
shall not be deemed ineligible because they are subject to a prior perfected
security interest in favor of Silicon Valley Bank. Following the conclusion of
such seven (7) day period, the accounts of DTM Corporation must satisfy all
conditions for eligibility as set forth in the definition of Eligible Accounts.
8. SECTION 2.2 of the Agreement is amended by replacing the payment grid
contained in that Section with a new payment grid as follows:
Date Installment Amount
==================================== ======================================
Commencing on September 1, 2001 and Accrued and unpaid interest
continuing on the same day of each
month until February 1, 2007
Commencing on March 1, 2002 and Quarterly principal installments equal
continuing on the same day of every to the lesser of the outstanding
third month thereafter principal balance of the Term Loan or
$750,000 each
On March 1, 2007 The unpaid principal balance, plus
accrued interest
9. SECTION 3.1(G) of the Agreement is deleted in its entirety and is
replaced with a new SECTION 3.1(G) as follows:
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(g) Agent shall have received certificates of status with respect to each
Borrower, each dated within 90 days of the Closing Date, updated by bring
down certificates as of the Closing Date, such certificates to be issued
for each of the jurisdictions (other than the jurisdiction of organization
of such Borrower) in which its failure to be duly qualified or licensed
would constitute a Material Adverse Change, which certificates shall
indicate that such Borrower is in good standing in such jurisdictions;
10. SECTION 3.1(K) of the Agreement is deleted in its entirety. A new
SECTION 3.2(G) is added to the Agreement to provide as follows:
(g) within 15 days following the Closing Date, Agent shall have received
satisfactory evidence that Borrowers have entered into an interest rate
swap agreement for an amount equal to $7,500,000 for a term of not less
than 3 years with a financial institution acceptable to the Agent, in its
Permitted Discretion;
11. A new SECTION 3.2(H) is added to the Agreement to provide as follows:
(h) within 10 days following the Closing Date, Agent shall have received an
opinion of Borrowers' Colorado counsel in form and substance reasonably
satisfactory to Agent and 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.
12. SECTION 4.1 of the Agreement is amended by adding a new sentence to the
end of that Section as follows:
The rights of the Lender Group in the Collateral shall not include any of
the rights comprising the Divestiture Assets, but shall include the
proceeds arising from divestiture transactions arising pursuant to the
Final Judgment. In this connection, Agent shall take such actions and
execute such documents as may be reasonably required by the United States
of America or its designee to comply with the terms of the Final Judgment.
13. SECTION 4.8 of the Agreement is deleted in its entirety and is replaced
with a new SECTION 4.8 as follows:
Notwithstanding anything to the contrary in this Agreement, Borrowers shall
have the right but not the obligation to effect the release of the
Additional Collateral prior to March 31, 2002 by:
(a) Effecting a Direct Xxxx Restructuring prior to such date; or
(b) Remedying to the satisfaction of Agent, in its Permitted
Discretion, any non-compliance with the Borrowing Base and any
Overadvances.
14. SECTION 6.2 of the Agreement is amended by replacing the reporting grid
contained in that Section with a new reporting grid as follows:
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Monthly (not later (a) a detailed calculation of the Borrowing Base
than the 30th of including detail regarding those Accounts that are not
each month) Eligible Accounts),
(b) a detailed aging, by total, of the Accounts,
together with a reconciliation to the detailed
calculation of the Borrowing Base previously provided
to Agent,
(c) a summary aging, by vendor, of Borrowers' accounts
payable and any book overdraft, and
(d) Inventory reports specifying Borrowers' cost of its
Inventory, by category and location, with additional
detail showing additions to and deletions from the
Inventory.
Upon request by (e) copies of invoices in connection with the Accounts,
Agent credit memos, remittance advices, deposit slips,
shipping and delivery documents in connection with the
Accounts and, for Inventory and Equipment acquired by
Borrowers, purchase orders and invoices, and
(f) such other reports as to the Collateral, or the
financial condition of Borrowers, as Agent may request.
15. SECTION 7.20(A)(III) of the Agreement is deleted in its entirety and is
replaced with a new SECTION 7.20(A)(III) as follows:
FIXED CHARGE COVERAGE RATIO. A Fixed Charge Coverage Ratio of not less than
1.25:1.00, for each fiscal quarter commencing with the fiscal quarter
ending June 30, 2001, and concluding with the fiscal quarter ending
September 30, 2003, and for all fiscal quarters thereafter, no less than
1.40:1.00.
16. SECTION 8.14 of the Agreement is deleted in its entirety and is
replaced with a new SECTION 8.14 as follows:
If on January 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 January 2, 2002, pursuant to Section 9.2; or
17. Borrowers agree that all costs, fees and expenses incurred in
connection with the issuance of the opinion of Agent's United Kingdom counsel,
including all attorneys' fees charged by such United Kingdom counsel, shall be
included in the Lender Group Expenses.
18. 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.
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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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TIGER DEALS, INC.,
a Delaware 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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DTM CORPORATION,
a Texas corporation, As a Borrower effective
upon consummation of the Merger
By:
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Title:
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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
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