Exhibit 10.1



 






Exhibit 10.1




FIRST AMENDMENT TO 

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT




     GMAC Commercial Finance LLC (“Lender”), Transcat, Inc. (“Parent”), Transmation
(Canada) Inc. (“Subsidiary”, or together with Parent, the “Borrowers”, or
individually a “Borrower”) enter into this First Amendment to Loan and Security Agreement
(the “Amendment”) on March 16, 2006.



BACKGROUND




     A. Borrowers and Lender entered into an Amended and Restated Loan and Security Agreement dated
November 1, 2004 (as amended from time to time, the “Loan Agreement”). Capitalized terms
used in this Amendment shall have the meanings set forth in the Loan Agreement unless otherwise
defined in this Amendment, and references to Sections refer to Sections of the Loan Agreement.



     B. Borrowers and Lender desire to amend the Loan Agreement.



     THEREFORE, in consideration of the mutual promises and agreements of the parties and for other
good and valuable consideration, the receipt and sufficiency of which is acknowledged, the parties
agree as follows:



TERMS AND CONDITIONS




     1. Consent to Asset Acquisition. Lender consents to Parent’s acquisition of
substantially all of the fixed and intangible assets of N.W. Calibration Inspection, Inc.
(“N.W.” and the “N.W. Assets”) for a cash purchase price not to exceed $830,000
(exclusive of any earn-out rights given to the Seller).



     2. Amendments.




	 	(A)	 	Interest Rate. The interest rate grid in Section
1(D) is amended and restated to read as follows:





	 	 	 	 	 	 	 	 	 
	 	 	Fixed Charge	 	 	 	 	 	 
	 	 	Coverage	 	Revolving	 	Cap-X Loans and	 	 
	Tier	 	Ratio*	 	Loans	 	Term Loan A	 	Term Loan B
	1

	 	1.249 or less
	 	(a) Prime Rate
minus 0.375% or (b)
LIBOR plus 2.375%
	 	(a) Prime Rate plus
0.125% or (b) LIBOR
plus 2.875%
	 	Prime Rate plus 0.375%
	 
	2

	 	1.25 to 1.49**
	 	(a) Prime Rate
minus 0.375% or (b)
LIBOR plus 2.125%
	 	(a) Prime Rate
minus 0.125% or (b)
LIBOR plus 2.625%
	 	Prime Rate plus 0.125%
	 
	3

	 	1.50 or greater
	 	(a) Prime Rate
minus 0.375% or (b)
LIBOR plus 1.875%
	 	(a) Prime Rate
minus 0.375% or (b)
LIBOR plus 2.375%
	 	Prime Rate minus
0.125%






1









 







	 	(B)	 	Term. The reference to “October 31, 2007” in Section 1(E)
is amended to read “October 31, 2008.”
	 
	 	(C)	 	Termination Premium. Section 3.4 is amended
and restated as follows:
	 
	 	 	 	If this Agreement is terminated or all Obligations are paid in full prior to
October 31, 2008, Borrower shall be obligated to pay Lender a termination
premium equal to the following (the “Termination Premium”):






	 	(a)	 	1% of the sum of the Advance Limit if
terminated before November 1, 2006; and
	 
	 	(b)	 	0.5% of the Advance Limit if terminated after
October 31, 2006 but before November 1, 2007; and
	 
	 	(c)	 	0.25% of the Advance Limit if terminated after
October 31, 2007 but other than on October 31, 2008.






	 	 	 	The Termination Premium will also be due and payable in connection with any
termination of this Agreement pursuant to Section 9.6 below and in
connection with termination of this Agreement by Lender upon an Event of
Default or by or on behalf of Borrower, whether voluntary or involuntary,
including upon an Event of Default which is not timely cured within any
applicable cure period, and including in connection with termination of this
Agreement or payment of the Obligations by any trustee or
debtor-in-possession in any Insolvency Proceeding. The Termination Premium
is presumed to be a reasonable estimate of the amount of damages sustained
by Lender as a result of the early termination of this Agreement and
Borrowers agree that such amount is reasonable under the circumstances
currently existing.
	 
	 	(D)	 	Capital Expenditures. Section 7.12 is amended
in its entirety to read as follows:
	 
	 	 	 	“Make or incur liabilities for Capital Expenditures
(including the purchase of assets associated with the
acquisition of the assets of N.W. Calibration Inspection,
Inc.) exceeding $2,000,000 for fiscal year 2006 and
$1,500,000 in any subsequent fiscal year.”





     3. Inclusion of N.W. Assets in Borrowing Base. Subject to the eligibility criteria in
the Loan Agreement, upon satisfaction of the conditions precedent set forth below, Lender will
include Accounts acquired from N.W. in the Borrowing Base.



     4. Conditions Precedent. Lender’s agreement to include N.W. Accounts in the Borrowing
Base will not be effective unless and until each of the following conditions are satisfied:



 









 






	 	(A)	 	All uniform commercial code, tax lien, litigation, judgment and
other searches conducted by Lender in respect of the Acquisition are
satisfactory to Lender and show that Lender will have security interests in the
N.W. Assets having the priorities called for by the Loan Agreement.
	 
	 	(B)	 	Lender and its counsel are reasonably satisfied with the terms
and conditions of all agreements entered into by Borrowers in connection with
the acquisition of the N.W. Assets.
	 
	 	(C)	 	No Material Adverse Change has occurred in the business or
financial condition of the Borrowers or N.W.





     5. Reaffirmation. Borrowers reaffirm, ratify and confirm their Obligations under the
Loan Agreement, acknowledge that all the terms and conditions in the Loan Agreement (except as
amended by this Amendment) remain in full force and effect and that the security interests granted
to Lender in the Collateral are valid and perfected.



     6. General Terms.




	 	(A)	 	Except as amended by this Amendment, all the terms and
conditions in the Loan Agreement remain in full force and effect.
	 
	 	(B)	 	This Amendment constitutes the entire agreement of the parties
in connection with the subject matter of this Amendment and cannot be changed
or terminated orally. All prior agreements, understandings, representations,
warranties and negotiations regarding the subject matter hereof, if any, are
merged into this Amendment.
	 
	 	(C)	 	This Amendment may be executed in counterparts, each of which
when so executed and delivered will be deemed an original, and all of such
counterparts together will constitute but one and the same agreement.





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	GMAC Commercial Finance LLC	 	Transcat, Inc.	
	 
	 	 	 	 	 	 	
	By:

	 	/s/ Jeffrey J. Much
	 	By:
	 	/s/ Charles P. Hadeed	
	

	 	 	 	
	 	 	
	 

	 	     Name: Jeffrey J. Much
	 	 	 	     Name: C. Hadeed	
	 

	 	     Title: First Vice President
	 	 	 	     Title: COO	
	 
	 	 	 	 	 	 	
	Transmation (Canada) Inc.	 	 	 	 	
	 
	 	 	 	 	 	 	
	By:

	 	/s/ Charles P. Hadeed	 	 	 	 	
	

	 	 	 	
	 	 	
	 

	 	     Name: C. Hadeed	 	 	 	 	
	 

	 	     Title: CFO