EXHIBIT

10.3




 




FOURTH

AMENDMENT TO


NOTE PURCHASE AGREEMENT




 




THIS FOURTH

AMENDMENT (this “Amendment”), dated as of December 31, 2002, to the

Note Purchase Agreement, dated as of March 27, 1998, by and among DRESDNER

KLEINWORT BENSON PRIVATE EQUITY PARTNERS LP, a Delaware limited partnership

(“the Purchaser”), and GARDENBURGER, INC., an Oregon corporation (the “Company”).




 




WHEREAS, the

parties hereto have entered into the Note Purchase Agreement, dated as of March

27, 1998 (the “Agreement”), a First Amendment to Note Purchase Agreement

dated as of December 23, 1999 (the “First Amendment”), a Second

Amendment to Note Purchase Agreement dated as of January 10, 2002 (the “Second

Amendment”), and a Third Amendment to Note Purchase Agreement dated as of

September 20, 2002 (the “Third Amendment”); unless otherwise defined

herein, all capitalized terms used herein (including the recitals) shall have

the meanings assigned to such terms in the Agreement, as amended by the First,

Second, and Third Amendments and hereby;




 




WHEREAS, the

Company has entered into a Revolving Credit and Term Loan Agreement dated as of

January 10, 2002, with CapitalSource Finance LLC as a lender  and as agent (“CapitalSource”),

pursuant to which, among other things, the Company refinanced its obligations

under the previous Senior Credit Agreement dated December 23, 1999, between the

Company and Bank of America Commercial Finance Corporation and received a

credit facility with an aggregate maximum borrowing availability of

$15,000,000;




 




WHEREAS, the

Company and CapitalSource are contemporaneously entering into a Second

Amendment to Revolving Credit and Term Loan Agreement dated as of

December 31, 2002; in which the definition of Capital Expenditures is

being amended to exclude certain expenditures; and




 




WHEREAS, the

Company has requested the Purchaser to amend the Agreement on the terms and

conditions set forth in this Amendment;




 




NOW, THEREFORE, in

consideration of the premises and the agreements, provisions, and covenants

contained herein, the parties hereto agree as follows.




 




1.     Amendment.




 




The definition of

Capital Expenditures contained in Section 2D(b) of the Agreement, as

amended by the Second Amendment, is hereby amended and restated effective as of

December 31, 2002, to read as follows:




 




                “‘CAPITAL EXPENDITURES’ shall

mean, for any Quarterly Test Period, the sum (without duplication) of all

expenditures (whether paid in cash or accrued as liabilities) during the

Quarterly Test Period that are or should be treated as capital expenditures

under GAAP, other than expenditures incurred on or after October 1, 2002,

relating to expansion of the Company’s refrigerator system 




 




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capacity and

acquisition of the Entrée/Tiromat line equipment and a mixer for the No. 3

production line.”




 




2.     Ratification

of Agreement.




 




(a)   To induce

the Purchaser to enter into this Amendment, the Company represents and warrants

that, after giving effect to this Amendment, no violation of the terms of the

Agreement exist and all representations and warranties contained in the

Agreement are true, correct, and complete in all material respects on and as of

the date hereof except as (i) reflected in any schedule to the New Senior

Credit Agreement, (ii) disclosed in the Company’s reports filed with the

Securities and Exchange Commission, or (iii) disclosed to Purchaser’s

representative on the Board during a meeting of the Board, and except to the

extent such representations and warranties specifically relate to an earlier

date in which case they were true, correct, and complete in all material

respects on and as of such earlier date.




 




(b)   Except as

expressly set forth in this Amendment, the terms, provisions and conditions of

the Agreement and the Investment Documents are unchanged, and said agreements,

as amended, shall remain in full force and effect and are hereby confirmed and

ratified.




 




3.     Binding

on Successors and Assigns.  All the

terms and provisions of this Amendment shall be binding upon and inure to the

benefit of the parties hereto, their respective successors, assigns and legal

representatives.  Whenever in this

Amendment any of the parties hereto is referred to, such reference shall be

deemed to include the successors and assigns of such party.




 




4.     Further

Assurances.  Each of the Company and

the Purchaser, as the case may be, shall duly execute and deliver, or cause to

be executed and delivered, such further instruments and perform or cause to be

performed such further acts as may be necessary or proper in the reasonable opinion

of the Purchaser to carry out the provisions and purposes of this Amendment.




 




5.     Effect

of Amendment.  To the extent any

terms and conditions in the Agreement shall contradict or be in conflict with

any provisions of this Amendment, the provisions of this Amendment shall

govern.




 




6.     Expenses.  All expenses of the Purchaser incurred in

connection with this Amendment, including reasonable expenses of Purchaser’s

counsel, will be paid by the Company.




 




7.     Governing

Law.  This Amendment shall be

governed by, and shall be construed in accordance with, the laws of the state

of New York, without giving effect to any choice of law or conflict of law

rules or provisions (whether of the state of New York or any other

jurisdiction) that would cause the application of the laws of any jurisdiction

other than the state of New York.




 




8.     Counterparts.  This Amendment may be executed in separate

counterparts, each of which shall be an original and all of which taken

together shall constitute one and the same agreement.




 




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IN WITNESS WHEREOF, the parties hereto have duly

executed this Amendment as of the date first written above.




 




 




	

   


  	

   


  	

  DRESDNER

  KLEINWORT BENSON PRIVATE


  EQUITY PARTNERS LP  


  	 

	

   


  	

   


  	

   


  	 

	

   


  	

   


  	

  By:


  	

  Dresdner Kleinwort Benson Private Equity LLC 


  	 

	

   


  	

   


  	

  Its:


  	

  General Partner 


  	 

	

   


  	

   


  	

   


  	

   


  	 

	

   


  	

   


  	

   


  	

  By:


  	

  /s/ 

  Alexander Coleman


  	

   


  
	

   


  	

   


  	

   


  	

  Its:


  	

  Authorized Representative


  
	

   


  	

   


  	

   


  	 

	

   


  	

   


  	

  GARDENBURGER,

  INC.


  	 

	

   


  	

   


  	

   


  	 

	

   


  	

   


  	

   


  	 

	

   


  	

   


  	

  By:


  	

  /s/  Lorraine

  Crawford  


  	

   


  	 

	

   


  	

   


  	

  Its:


  	

  Vice President of Finance


  	 

									





 




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