**EXECUTIONVERSION**

**EXHIBIT10.16**

**THIRDAMENDMENT TO CREDIT AGREEMENT**

**THIS THIRD AMENDMENT TO CREDIT AGREEMENT**(this“Amendment”) is made and entered into as of March 30, 2007, by and among**GTSI CORP.**, a Delaware corporation (the“Borrower”), the Lenders (as defined below) signatory hereto, the otherBorrower Parties (as defined below) signatory hereto, and **CRYSTALCAPITAL FUND, L.P.**, in its capacity as Administrative Agent for theLenders (the “Administrative Agent”).

**WITNESSETH:**

WHEREAS,the Borrower, certain Subsidiaries of the Borrower signatory thereto asGuarantors (together with the Borrower, collectively, the “Borrower Parties”),the lenders signatory thereto from time to time (the “Lenders”) and theAdministrative Agent are parties to a certain Credit Agreement, dated as ofJune 2, 2006, as amended by that certain First Amendment to Credit Agreementdated as of July 12, 2006 and as further amended by that certain SecondAmendment to Credit Agreement dated as of November 30, 2006 (as amended, restated,supplemented or otherwise modified from time to time, the “Credit Agreement”;capitalized terms used herein and not otherwise defined shall have the meaningsassigned to such terms in the Credit Agreement), pursuant to which the Lendershave made certain financial accommodations available to the Borrower; and

WHEREAS,the Borrower has requested that the Lenders and the Administrative Agent amendcertain provisions of the Credit Agreement, and subject to the terms andconditions hereof, the Lenders and the Administrative Agent are willing to doso;

NOW,THEREFORE, for good and valuable consideration, the sufficiency and receipt ofall of which are acknowledged, the Borrower, the Lenders and the AdministrativeAgent agree as follows:

1.             Amendmentsto Section 1.1.  Section 1.1of the Credit Agreement, “Definitions”, is hereby amended and modified byadding the following new definition of “Third Amendment Effective Date” in theappropriate alphabetical order:

“Third AmendmentEffective Date” shall mean March 30, 2007.

2.             Amendmentto Section 2.4(b).  Section 2.4(b)of the Credit Agreement, “Early Termination Fee”, is hereby amended andmodified by deleting such section in its entirety and by substituting thefollowing in lieu thereof:

“(b)         Early Termination Fee.  In the event of any repayment or prepaymentof the Term Loan (or any portion thereof) prior to the date which istwenty-four (24) months after the Third Amendment Effective Date for anyreason, including, without limitation, (i) the acceleration of the Obligationsafter the occurrence of an Event of Default, (ii) the sale of, or casualty orcondemnation of, any Collateral or the foreclosure and sale of 

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Collateral, (iii) sale of the Collateral in anybankruptcy or insolvency proceeding, or (iv) the restructure, reorganization orcompromise of the Obligations by the confirmation of a plan of reorganization,or any other plan of compromise, restructure, or arrangement in any bankruptcyor insolvency proceeding, then, in view of the impracticability and extremedifficulty of ascertaining the actual amount of damages to the Lenders orprofits lost by the Lenders as a result of such early termination, and bymutual agreement of the parties as to a reasonable estimation and calculationof the lost profits or damages of the Lenders, and as compensation for the costof making the Term Loan available to the Borrower, and not as a penalty, theBorrower shall pay to the Administrative Agent, for the benefit of the Lenders,an early termination fee (the “Early Termination Fee”) equal to thegreater of (A) the result (not less than $0) of (y) all interest on the TermLoan that would be payable from the Third Amendment Effective Date through thedate which is twelve (12) months after the Third Amendment Effective Date, minus(z) amounts actually paid by the Borrower in respect of all such interest(other than interest at the Default Rate) through the date of prepayment and(B) one percent (1.00%) of the amount repaid or prepaid.  The Early Termination Fee shall be allocatedamong the Lenders in accordance with the amount of each Lender’s Term LoanRatio.”

3.             Amendmentto Section 8.9.  Section 8.9of the Credit Agreement, “Minimum EBITDA”, is hereby amended and modified bydeleting such section in its entirety and by substituting the following in lieuthereof:

“Section 8.9           Minimum EBITDA.  Commencing with the fiscal quarter endingJune 30, 2007 and continuing until the FCCR Election Date, the Borrower Partiesshall not permit the EBITDA of the Borrower Parties to be less than the amountsset forth in the table below for the applicable periods set forth in suchtable:

| Period                                                 | ** ** | ** ** | ** **  | **Minimum EBITDA** | ** ** |
|--------------------------------------------------------|------------|------------|-------------|-------------------------|------------|
| Two fiscal  quarter period ending June 30, 2007        |       | $          | (10,421,000 | )                       |
| Three fiscal  quarter period ending September 30, 2007 |       | $          | (5,531,000  | )                       |
| Four fiscal  quarter period ending December 31, 2007   |       | $          | 4,477,000   |                    |
| Four fiscal  quarter period ending March 31, 2008      |       | $          | 6,000,000   |                    |
| Four fiscal quarter  period ending June 30, 2008       |       | $          | 8,000,000   |                    |

 

4.             Conditionsto Effectiveness of this Amendment.****Notwithstandingany other provision of this Amendment, it is understood and agreed that thisAmendment shall not become effective, and the parties shall have no rightsunder this Amendment, until the Administrative Agent shall have received:

 

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                (a)           executed counterparts to this Amendment from the Borrower,each of the other Borrower Parties and the Majority Lenders;

(b)           a fully executed amendment containingcorresponding amendments to those contained herein (where applicable) under theSenior Credit Facility Documents, which shall be in form and substancesatisfactory to the Administrative Agent; and

(c)           payment of an amendment fee to eachLender executing this Amendment in an amount equal to 0.30% of the outstandingprincipal amount of such Lender’s Term Loan, which shall be fully earned whendue and non-refundable when paid.

5.             Representationsand Warranties.  To induce theLenders and the Administrative Agent to enter into this Amendment, eachBorrower Party hereby represents and warrants to the Lenders and theAdministrative Agent that:

(a)           The execution, delivery andperformance by such Borrower Party of this Amendment (i) are within suchBorrower Party’s power and authority; (ii) have been duly authorized byall necessary corporate and shareholder action; (iii) are not incontravention of any provision of such Borrower Party’s certificate ofincorporation or bylaws or other organizational documents; (iv) do notviolate any law or regulation, or any order or decree of any GovernmentalAuthority; (v) do not conflict with or result in the breach or terminationof, constitute a default under or accelerate any performance required by, anyMaterial Contract to which such Borrower Party is a party; (vi) do not resultin the creation or imposition of any Lien upon any of the property of suchBorrower Party or any of its Subsidiaries; and (vii) do not require theconsent or approval of any Governmental Authority or any other Person;

(b)           This Amendment has been duly executedand delivered for the benefit of or on behalf of each Borrower Party andconstitutes a legal, valid and binding obligation of each Borrower Party,enforceable against such Borrower Party in accordance with its terms except asthe enforceability hereof may be limited by applicable bankruptcy, insolvency,reorganization, moratorium or similar laws affecting the enforcement ofcreditor’s rights generally or by general principles of equity (regardless ofwhether such enforcement is considered in a proceeding in equity or at law);and

(c)           The representations and warrantiescontained in the Credit Agreement and the other Loan Documents are true andcorrect in all material respects, and no Default or Event of Default hasoccurred and is continuing as of the date hereof.

6.             Reaffirmationsand Acknowledgments.

(a)           Reaffirmation of Guaranty.  Each Guarantor consents to the execution anddelivery by the Borrower of this Amendment and jointly and severally ratify andconfirm the terms of the Guaranty contained in Article 3 of the CreditAgreement with respect to the indebtedness now or hereafter outstanding underthe Credit Agreement as amended hereby and all promissory notes issuedthereunder.

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(b)           Acknowledgment of SecurityInterests. Each Borrower Party hereby acknowledges that, as of the datehereof, the security interests and liens granted to the Administrative Agentand the Lenders under the Credit Agreement and the other Loan Documents are infull force and effect and are enforceable in accordance with the terms of theCredit Agreement and the other Loan Documents.

7.             Effect of Amendment.  Except as set forth expressly herein,all terms of the Credit Agreement, as amended hereby, and the other LoanDocuments shall be and remain in full force and effect.  Theexecution, delivery and effectiveness of this Amendment shall not, except asexpressly provided herein, operate as a waiver of any right, power or remedy ofthe Lenders under the Credit Agreement, nor constitute a waiver of anyprovision of the Credit Agreement.  ThisAmendment shall constitute a Loan Document for all purposes of the CreditAgreement.

8.             GoverningLaw.  This Amendment shall begoverned by, and construed in accordance with, the internal laws of theCommonwealth of Massachusetts and all applicable federal laws of the UnitedStates of America.

9.             NoNovation**.** This Amendment is not intended by the parties to be, and shall not beconstrued to be, a novation of the Credit Agreement or an accord andsatisfaction in regard thereto.

10.           Costs and Expenses. The Borrower agrees to pay, in accordance with the terms and conditionscontained in the Credit Agreement, all costs and expenses of the AdministrativeAgent in connection with the preparation, execution and delivery of thisAmendment, including, without limitation, the reasonable fees and out-of-pocketexpenses of outside counsel for the Administrative Agent with respect thereto.

11.           Counterparts.  This Amendment may be executed by one or moreof the parties hereto in any number of separate counterparts, each of which shallbe deemed an original and all of which, taken together, shall be deemed toconstitute one and the same instrument. Delivery of an executed counterpart of this Amendment by facsimiletransmission or by electronic mail in pdf form shall be as effective asdelivery of a manually executed counterpart hereof.

12.           BindingNature.  This Amendment shall bebinding upon and inure to the benefit of the parties hereto, their respectivesuccessors, successors-in-titles, and assigns.

13.           EntireUnderstanding.  This Amendment setsforth the entire understanding of the parties with respect to the matters setforth herein, and shall supersede any prior negotia­tions or agreements,whether written or oral, with respect thereto.

14.           Release.  In consideration for the accommodationsprovided pursuant to this Amendment, and acknowledging that the AdministrativeAgent and Lenders will be specifically relying on the following provisions as amaterial inducement in entering into this Amendment, 

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andfor other good and valuable consideration, the receipt and sufficiency of whichis hereby acknowledged, each Borrower Party hereby releases, remises andforever discharges the Administrative Agent and the Lenders and theirrespective agents, servants, employees, directors, officers, attorneys,accountants, consultants, affiliates, representatives, receivers, trustees,subsidiaries, predecessors, successors and assigns (collectively, the “ReleasedParties”) from any and all claims, damages, losses, demands, liabilities,obligations, actions and causes of action whatsoever (whether arising incontract or in tort, and whether at law or in equity), whether known orunknown, matured or contingent, liquidated or unliquidated, in any way arisingfrom, in connection with, or in any way concerning or relating to the CreditAgreement, the other Loan Documents, and/or any dealings with any of theReleased Parties in connection with the transactions contemplated by suchdocuments or this Amendment prior to date hereof.  This release shall be and remain in fullforce and effect notwithstanding the discovery by the Borrower Parties afterthe date hereof (a) of any new or additional claim against any Released Party,(b) of any new or additional facts in any way relating to the subject matter ofthis release, (c) that any fact relied upon by it was incorrect or (d) that anyrepresentation made by any Released Party was untrue or that any Released Partyconcealed any fact, circumstance or claim relevant to the Borrower Parties’execution of this release; provided, however, this release shallnot extend to any claims arising after the execution of this Amendment.

[*Signature Pages To Follow*]

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INWITNESS WHEREOF, the parties hereto have caused this Amendment to be dulyexecuted under seal by their respective authorized officers as of the day andyear first above written.
| **BORROWER:**   | ** ** | **GTSI CORP.**                    |
|-----------------|------------|-----------------------------------|
|            |       |                              |   |   |
|            |       |                              |   |   |
|            |       | By:                               |   |   |
|            |       |                              |   | Name: |
|            |       |                              |   | Title: |
|            |       |                              |   |   |
|            |       |                              |   |   |
| **GUARANTORS:** | ** ** | **GTSI FINANCIAL SERVICES, INC.** |
| ** **      | ** ** | ** **                        | ** ** | ** ** |
| ** **      | ** ** | ** **                        | ** ** | ** ** |
|            |       | By:                               |   |   |
|            |       |                              |   | Name: |
|            |       |                              |   | Title: |
|            |       |                              |   |   |
|            |       |                              |   |   |
| ** **      |       | **TECHNOLOGY LOGISTICS, INC.**    |
| ** **      |       |                              |   | ** ** |
| ** **      |       |                              |   | ** ** |
|            |       | By:                               |   |   |
|            |       |                              |   | Name: |
|            |       |                              |   | Title: |

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| **ADMINISTRATIVE AGENT AND** |       |                                                                     |
|------------------------------|------------|--------------------------------------------------------------------------|
| **LENDERS:**                 | ** ** | **CRYSTAL CAPITAL FUND, L.P.,**as  the Administrative Agent and a Lender |
| ** **                   | ** ** | ** **                                                               | ** ** | ** ** |
| ** **                   | ** ** | ** **                                                               | ** ** | ** ** |
|                         |       | By:                                                                      |   | Crystal Capital GP, LLC, its General Partner |
|                         |       |                                                                     |   |   |
|                         |       |                                                                     |   |   |
|                         |       | By:                                                                      |   |   |
|                         |       |                                                                     |   | Name: |
|                         |       |                                                                     |   | Title: |

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|            |   |   |   | **CRYSTAL CAPITAL FUND, LTD,**as  a Lender |
|------------|--------|--------|--------|--------------------------------------------|
| ** ** |   |   |   | ** **                                 |
| ** ** |   |   |   | ** **                                 |
|       |   | By:    |   |                                       |
|       |   |   |   | Name:                                      |
|       |   |   |   | Title:                                     |

 

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