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                                                                     Exhibit 4.1

                              SECOND RESTATEMENT OF
                                GSI LUMONICS INC.

                           1995 EQUITY INCENTIVE PLAN

1.    Purpose

      GSI Lumonics Inc. 1995 Equity Incentive Plan for Employees and Directors
      (the "Plan"), formerly known as the 1995 Stock Option Plan for Employees
      and Directors, is intended to retain and reward highly qualified employees
      (including contract employees), consultants and directors who will be
      motivated to contribute to the success of GSI Lumonics Inc. and its
      subsidiaries (the "Company") through the grant of Awards (as defined in
      Section 2 below) and encouraged to purchase Common Shares of the Company
      (the "Common Shares"). The Plan came into force effective September 29th,
      1995 and is amended and restated as of May 20, 2004.

2.    Number of Common Shares to be Offered

      The maximum number of Common Shares that will be reserved for issuance and
      issued under this Plan shall not exceed 6,906,000 shares. The issuance of
      Common Shares upon the exercise or satisfaction of an Award shall reduce
      the total number of Common Shares available under the Plan. The following
      restrictions shall also apply to this Plan as well as all other plans or
      stock option agreements to which the Company may be a party:

            (i)   the aggregate number of Common Shares reserved for issuance
                  pursuant to Awards granted to Insiders shall not exceed ten
                  percent (10%) of the Outstanding Issue;

            (ii)  Insiders shall not be issued, within any one year period,
                  Awards for Common Shares which exceed ten percent (10%) of the
                  Outstanding Issue;

            (iii) no Insider together with such Insider's Associates shall be
                  issued, within any one year period, Awards for a number of
                  Common Shares which exceeds five percent (5%) of the
                  Outstanding Issue; and

            (iv)  the number of Common Shares reserved for issuance pursuant to
                  Awards to any one participant shall not exceed five percent
                  (5%) of the Outstanding Issue.

            (v)   The aggregate number of Common Shares reserved for issuance
                  pursuant to Awards to all members of the Board Directors of
                  the Company as a group may not exceed at any one time one
                  percent (1%) of the Outstanding Issue.

      For the purpose of this Plan:

            "Associate" has the meaning assigned by the Securities Act
      (Ontario), as amended from time to time.

            "Award" means an Option, Stock Appreciation Right or Share of
      Restricted Stock granted pursuant to this Plan.

            "Code" means the U.S. Internal Revenue Code of 1986, as amended, and
      the regulations thereunder.
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            "Incentive Stock Option" means an incentive stock option as defined
      in Section 422 of the Code.

            "Insider" means:

                  (i)        an insider of the Company as defined by the
                        Securities Act (Ontario) as amended from time to time,
                        other than a person who falls within such definition
                        solely by virtue of being a director or senior officer
                        of a subsidiary of the Company; and

                  (ii)       an Associate of any person who is an insider by
                        virtue of Clause (i) of this definition; and

            "Option" means any stock option granted under Section 6.

            "Outstanding Issue" means the number of Common Shares of the Company
      that are outstanding immediately prior to any issuance of Awards under
      this Plan, excluding Common Shares issued pursuant to the Plan during the
      preceding one year period.

            "Restricted Shares" means any Common Share granted under Section 7.

            "Stock Appreciation Right" means a stock appreciation right granted
      pursuant to Section 8.

            Upon the expiration, surrender or termination, in whole or in part,
      of an unexercised Award, the Common Shares subject to such unexercised
      Award shall be available for other Options to be granted from time to
      time.

3.    Administration

      The Plan shall be administered by the Compensation Committee of the Board
      of Directors of the Company (the "Committee") who shall be appointed by
      and serve at the pleasure of the Board of Directors (the "Board"). The
      Committee shall have full power and authority, subject to the terms of the
      Plan, to make Awards on behalf of the Company; to designate the
      individuals to whom Awards shall be granted (the "Participants" or
      "Participant"); the number of Common Shares covered by each Award; and the
      form, amount and other terms and conditions of each Award. The Committee
      shall also have full power and authority otherwise to interpret and
      construe the terms of the Plan. Any determination by the Committee shall
      be final and conclusive unless otherwise determined by the Board and, in
      any such event, such determination of the Board shall be final and
      conclusive. The day-to-day administration of the Plan may be delegated to
      such officers and employees of the Company as the Committee in its sole
      discretion shall determine.

4.    Eligible Participants

      The individuals eligible to receive Awards shall be confined to employees
      (including contract employees) and consultants (who are engaged to provide
      ongoing bona fide consulting services for the Company or any subsidiary,
      spend a significant amount of their time and attention on the affairs and
      business of the Company or any subsidiary, and have a relationship with
      the Company or any subsidiary that will permit them to be knowledgeable in
      respect of the business affairs of the Company) and directors of the
      Company as shall be determined from time to time by the Committee. In
      making such determination, the Committee shall consider the duties and
      responsibilities of the individual, his or her present and potential
      contribution to the success of the Company or any subsidiary, and such
      other factors as the Committee shall deem relevant in accomplishing the
      purposes of the Plan. Participation in the Plan shall be entirely
      voluntary and any decision by any individual not to participate shall not
      affect such individual's employment with the Company or any subsidiary.

5.    Rules Applicable to Awards
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      (a)   Grant of Awards. From time to time the Committee or the Board of
            Directors may grant Awards on behalf of the Company under the Plan.

      (b)   Exercise or Purchase Price. The exercise price ("Exercise Price") or
            purchase price ("Purchase Price") of an Award of Options or
            Restricted Shares shall be the Market Price per Common Share as of
            the date of grant of the Award. The Exercise Price of an Award of
            Stock Appreciation Rights shall be determined in accordance with
            Section 8(b) of this Plan. The "Market Price" per Common Share at
            any date shall be the closing price of the Common Shares on The
            Toronto Stock Exchange (the "Exchange") (or if the Common Shares are
            not then listed or posted for trading on the Exchange, on such stock
            exchange in Canada on which such shares are listed and posted for
            trading as may be selected for such purpose by the Committee) on the
            date of grant. In the event that the Common Shares are not listed
            and posted for trading on any stock exchange in Canada, the market
            price shall be the last trading price of the Common Shares on The
            NASDAQ Stock Market ("NASDAQ") on the date of grant. In the event
            that the Common Shares are not trading on NASDAQ, the market price
            shall be determined by the Committee in its sole discretion.

      (c)   Exercise Period; Vesting. An Award of Options or Stock Appreciation
            Rights may be exercised at any time or from time to time within such
            period as the Committee shall determine (the "Exercise Period"), but
            in no event shall such Exercise Period be greater than 10 years from
            the date of grant. The Committee may, but shall not be required to,
            impose such conditions on the exercise of an Award as the Committee
            deems appropriate. Unless otherwise specifically approved by the
            Committee, An Award shall vest and, in the case of Options or Stock
            Appreciation Rights, be exercisable by a Participant at a rate of
            twenty-five percent (25%) per year on the first, second, third and
            fourth anniversaries of the Date of Grant of such Award. Unless
            otherwise determined by the Committee, all outstanding Awards shall
            immediately vest and, in the case of Options or Stock Appreciation
            Rights, become exercisable by a Participant upon a change in control
            (as determined by the Board) of the Company. Notwithstanding the
            foregoing or anything contained herein to the contrary, the
            Committee may, from time to time, in its sole discretion, by written
            notice to any Participant, amend the vesting schedule of Awards
            granted under this Plan, including without limitation the
            acceleration of vesting such that some or all of the Awards granted
            under this Plan become immediately fully vested.

      (d)   Methods of Payment. Payment for purchase of Common Shares shall be
            made in cash or by certified check. Only full shares shall be issued
            under the Plan.

      (e)   Termination of Employment. The following shall apply in the event
            that the employment, board, consultancy or other service position of
            a Participant is terminated for whatever reason. The date of
            termination is referred to herein as the "Termination Date". For
            purposes of the Plan, the transfer of a Participant to a different
            position or office within the Company or any subsidiary shall not be
            considered a termination.

            (i)        If the cause of termination is dismissal for cause of the
                  Participant, all Awards shall cease vesting on the Termination
                  Date and all Options or Stock Appreciation Rights held by the
                  Participant on the Termination Date shall terminate 30 days
                  following the Termination Date, prior to which date (A) the
                  Participant may exercise all or any part of the Participant 's
                  Award of Options or Stock Appreciation Rights that have vested
                  and are exercisable in accordance with the provisions of
                  Section 5(c) hereof, and (B) the Company may repurchase from
                  the Participant all unvested Restricted Shares held by the
                  Participant in accordance with the terms thereof.

            (ii)       If the cause of termination is other than the death or
                  dismissal for cause of the Participant, all Awards shall cease
                  vesting and all Options or Stock Appreciation Rights held by
                  the Participant on the Termination Date shall terminate 60
                  days following the Termination Date, prior to which date (A)
                  the Participant may
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                  exercise all or any part of the Participant 's Award of
                  Options or Stock Appreciation Rights that have vested and are
                  exercisable in accordance with the provisions of Section 5(c)
                  hereof, and (B) the Company may repurchase from the
                  Participant all unvested Restricted Shares held by the
                  Participant in accordance with the terms thereof. The Chief
                  Executive Officer of the Company may extend such period for up
                  to an additional 30 days.

            (iii)      If the cause of termination is the death of the
                  Participant, all Awards shall immediately cease vesting and
                  the Participant's Award of Options or Stock Appreciation
                  Rights shall terminate six (6) months following the
                  Termination Date prior to which date (A) the legal personal
                  representative(s) of the deceased Participant may exercise
                  such portion of the Participant 's Award of Options or Stock
                  Appreciation Rights that have vested and are exercisable in
                  accordance with the provisions of Section 5(c) hereof, and (B)
                  the Company may repurchase from the legal personal
                  representative(s) of the deceased Participant all unvested
                  Restricted Shares held by the Participant on the Termination
                  Date in accordance with the terms thereof.

            (iv)       As regards the provisions of this paragraph (e) the
                  Committee reserves the right, in its sole discretion, to
                  extend the period for vesting and exercise of an Award after
                  the Termination Date to a date which shall not be later than
                  the earlier of (A) in respect of an employee Participant
                  (including executive officers), three years after the
                  Termination Date, or (B) in respect of a director, contract
                  employee or consultant Participant, one year after the
                  Termination Date.

            (v)        In no event may an Award of Options or Stock Appreciation
                  Rights be exercised after the expiration of the Exercise
                  Period.

      (f)   Transferability. An Award may not be assigned or transferred. Each
            Award of Options or Stock Appreciation Rights will be exercisable
            during the lifetime of the Participant only by the Participant. In
            the event of the death of a Participant, the legal personal
            representative(s) of the deceased Participant may exercise, within
            the period set out in Section 5(e)(ii) hereof, such portion of the
            Participant's Award of Options or Stock Appreciation Rights that
            would have been exercisable by the Participant on the date of death
            in accordance with the provisions of Section 5(c) hereof.

      (g)   Reorganization and Recapitalization. In the event of any
            subdivision, redivision or change of the Common Shares of the
            Company at any time into a greater number of shares, the Company
            shall deliver at the time of any exercise thereafter of Options or
            Stock Appreciation Rights hereby granted such additional number of
            shares as would have resulted from such subdivision, redivision or
            change if such exercise of the Award hereby granted had been prior
            to the date of such subdivision, redivision or change. In the event
            of any consolidation or change of the Common Shares of the Company
            at any time into a lesser number of shares, the number of shares
            deliverable by the Company on any exercise thereafter of Options or
            Stock Appreciation Rights hereby granted shall be reduced to such
            number of shares as would have resulted from such consolidation or
            change if such exercise of the Award hereby granted had been prior
            to the date of such consolidation or change.

6.    Options

      Options granted under the Plan shall be, as determined by the Committee,
      non-qualified or Incentive Stock Options for U.S. federal income tax
      purposes, as evidenced by the related Award agreements, and shall be
      subject to such other terms and conditions consistent with Section 5
      hereof as the Committee shall determine.
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      Incentive Stock Options. An Option that the Board intends to be an
      Incentive Stock Option" shall be granted only to employees of the Company
      and shall be subject to and shall be construed consistently with the
      requirements of Section 422 of the Code. The Board and the Company shall
      have no liability if an Option or any part thereof that is intended to be
      an Incentive Stock Option does not qualify as such.

      To the extent required for "Incentive Stock Option" treatment under
      Section 422 of the Code, the aggregate Market Value (determined as of the
      time of grant) of the Common Shares with respect to which Incentive Stock
      Options granted under this Plan and any other plan of the Company or its
      parent and subsidiary corporations become exercisable for the first time
      by a Participant during any calendar year shall not exceed $100,000. To
      the extent that any Option exceeds this limit, it shall constitute a
      non-qualified Option.

      If an employee owns or is deemed to own (by reason of the attribution
      rules of Section 424(d) of the Code) more than 10% of the combined voting
      power of all classes of shares of the Company or any parent or subsidiary
      corporation and an Incentive Stock Option is granted to such employee, the
      Exercise Price of such Incentive Stock Option shall be not less than 110%
      of the Market Value on the grant date, and the term of such Incentive
      Stock Option shall be no more than five years from the date of such grant.

7.    Restricted Shares

            (a)   Grant. Subject to the provisions of the Plan, the Committee
                  shall determine the number of shares of Restricted Stock to be
                  granted to each Participant, the duration of the period during
                  which, and the conditions, if any, under which, the Restricted
                  Stock may be forfeited to the Company, and the other terms and
                  conditions of such Awards.

            (b)   Transfer Restrictions. Shares of Restricted Stock may not be
                  sold, assigned, transferred, pledged or otherwise encumbered,
                  except as provided in the Plan or the applicable Award
                  agreement. Shares of Restricted Stock shall be registered in
                  the name of the Participant and held by the Company. After the
                  lapse of the restrictions applicable to such shares of
                  Restricted Stock, the Company shall deliver such shares to the
                  Participant or the Participant's legal representative.

            (c)   Dividends. Dividends or dividend equivalents paid on any
                  shares of Restricted Stock may be paid directly to the
                  Participant, withheld by the Company subject to vesting of the
                  Restricted Stock pursuant to the terms of the applicable Award
                  agreement, or may be reinvested in additional shares of
                  Restricted Stock, as determined by the Committee in its sole
                  discretion.

8.    Stock Appreciation Rights

            (a)   Grants. The Committee may grant (i) a Stock Appreciation Right
                  independent of an Option or (ii) a Stock Appreciation Right in
                  connection with an Option, or a portion thereof. The Committee
                  may impose such terms and conditions upon any Stock
                  Appreciation Right as it deems fit. A Stock Appreciation Right
                  granted pursuant to clause (ii) of the preceding sentence (A)
                  may be granted at the time the related Option is granted or at
                  any time prior to the exercise or cancellation of the related
                  Option, (B) shall cover the same number of Common Shares
                  covered by an Option (or such lesser number of Common Shares
                  as the Committee may determine) and (C) shall be subject to
                  the same terms and conditions as such Option except for such
                  additional limitations as are contemplated by this Section 8
                  (or such additional limitations as may be included in an Award
                  agreement) and those imposed by the Code.

            (b)   Terms. The Exercise Price of a Stock Appreciation Right shall
                  be an amount determined by the Committee but in no event shall
                  such amount be less than the Market Price per
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                  Common Share on the date the Stock Appreciation Right is
                  granted; provided, however, that, notwithstanding the
                  foregoing, in the case of a Stock Appreciation Right granted
                  in conjunction with an Option, or a portion thereof, the
                  exercise price may not be less than the Exercise Price of the
                  related Option. Each Stock Appreciation Right granted
                  independent of an Option shall entitle a Participant upon
                  exercise to an amount equal to (i) the excess of (A) the
                  Market Price per Common Share on the exercise date divided by
                  (B) the Exercise Price per Common Share, times (ii) the number
                  of Common Shares covered by the Stock Appreciation Right. Each
                  Stock Appreciation Right granted in conjunction with an
                  Option, or a portion thereof, shall entitle a Participant to
                  surrender to the Company the unexercised Option, or any
                  portion thereof, and to receive from the Company in exchange
                  therefor an amount equal to (I) the excess of (x) the Market
                  Price per Common Share on the exercise date of one Common
                  Share divided by (y) the Exercise Price, times (II) the number
                  of Common Shares covered by the Option, or portion thereof,
                  which is surrendered. Payment shall be made in Common Shares
                  or in cash, or partly in Common Shares and partly in cash (any
                  such Common Shares valued at such Market Price per Common
                  Share), all as set forth in the Award agreement. Stock
                  Appreciation Rights may be exercised from time to time upon
                  actual receipt by the Company of written or electronic notice
                  of exercise stating the number of Common Shares with respect
                  to which the Stock Appreciation Right is being exercised. The
                  date a notice of exercise is received by the Company shall be
                  the exercise date.

9.    Amendment and Discontinuance

      The Committee shall have the right to amend or modify this Plan or to
      terminate this Plan at any time without notice provided that a
      Participant's rights are not thereby materially adversely affected and
      subject to any approvals required under the applicable rules of any stock
      exchange upon which the Common Shares of the Company are or may be listed.

10.   Repricing Awards.

      The Exercise Price or Purchase Price of Awards previously granted under
      this Plan may not be reduced, nor may any Awards be canceled and reissued
      at a lower Exercise Price or Purchase Price, unless such action is
      approved by the shareholders of the Company or unless such reduction is
      made pursuant to a recapitalization or reorganization in accordance with
      Section 5(g) of this Plan.

11.   Employment Non-Contractual

      Nothing in this option shall be construed as conferring upon the
      Participant any right to continue in the service of the Company or any
      subsidiary of the Company.

12.   Rights as a Shareholder

      Except with respect to Restricted Shares, a Participant shall not have any
      rights as a shareholder with respect to any Common Shares issuable upon
      exercise of an Award until the Award has been validly exercised and the
      purchase price for such Common Share has been paid in full.

13.   Nontransferability

      The Participant's rights under an Award are not assignable or transferable
      by a Participant during the Participant 's lifetime and are exercisable
      during the Participant 's lifetime only by the Participant.
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14.   Corporate Action

      Nothing contained herein shall be construed so as to prevent the Company
      or any subsidiary of the Company from taking corporate action which is
      deemed by the Company or the subsidiary to be appropriate or in its best
      interest, whether or not such action would have an adverse effect on the
      Award.

15.   Government Regulation

      The Company's obligation to issue and deliver Common Shares under an Award
      is subject to:

      (a)   the satisfaction of all requirements under applicable securities law
            in respect thereof and obtaining all regulatory approvals as the
            Company shall determine to be necessary or advisable in connection
            with the authorization, issuance or sale thereof, including
            shareholder approval, if required;

      (b)   the admission of such Common Shares to listing on any stock exchange
            on which Common Shares may then be listed; and

      (c)   the receipt from the Participant of such representations, agreements
            and undertakings as to future dealings in such Common Shares as the
            Company determines to be necessary or advisable in order to
            safeguard against the violation of the securities law of any
            jurisdiction. In this connection, the Company shall take all
            reasonable steps to obtain such approvals and registrations as may
            be necessary for the issuance of such Common Shares in compliance
            with applicable securities law and for the listing of such Common
            Shares on any stock exchange on which such Common Shares are then
            listed.

16.   Approvals

      This Plan shall be subject to acceptance by The Toronto Stock Exchange
      (the "Toronto Exchange") and NASDAQ and is subject to shareholder approval
      as required by the rules and regulations of The Toronto Exchange and
      NASDAQ in compliance with all conditions imposed by such exchanges. Any
      Awards granted prior to such acceptance and approval shall be conditional
      upon such acceptance and approval being given and any conditions complied
      with and no such Awards may be exercised unless such acceptance and
      approval is given and such conditions are complied with.

17.   Governing Law

      This Plan and any Awards granted hereunder shall be governed by and
      interpreted in accordance with the laws of the Province of Ontario.

18.   Additional Information for Quebec Residents

      The following information will be provided to Participants who are
      residents of the Province of Quebec at the time that they are granted
      Awards pursuant to the Plan:

      (a)   There is no minimum sum to be collected under the Plan and the
            Company proposes to use the proceeds of the Plan for general
            corporate purposes;

      (b)   No changes have occurred among the senior executives of the Company
            since the last annual meeting of shareholders other than as
            disclosed in a Schedule that will be attached;

      (c)   There has been no transfer of the securities of the Company that
            resulted in a material change in control of the Company since the
            last meeting of shareholders of the Company other than as disclosed
            in a Schedule that will be attached;
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      (d)   All other material facts in respect of the Company or the securities
            offered under the Plan that are necessary to enable an informed
            decision have been made public; and

      (e)   A copy of the most recent audited financial statements of the
            Company will be attached.