Document:

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                       COMMERCIAL REVOLVING LOAN AGREEMENT

         REVOLVING LOAN AGREEMENT, dated as of October 23, 1999 between GUNTHER
INTERNATIONAL, LTD., a corporation with offices at One Winnenden Road, Norwich
CT 06360-1570 ("Borrower") and PEOPLE'S BANK, a Connecticut banking institution
with offices at 850 Main Street, Bridgeport, Connecticut 06604 ("Bank"). The
parties hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         As used in this Agreement, the following terms have the following
meanings (terms defined in the singular to have the same meaning when used in
the plural and vice versa):

                  Section 1.1 "Agreement" means this Revolving Loan Agreement,
as amended, supplemented, or modified from time to time in a writing executed by
Borrower and Bank.

                  Section 1.2 "Borrowing Limit" means FIVE HUNDRED THOUSAND AND
NO/100 ($500,000.00) DOLLARS, subject to the terms of Sections 2.5 and 3.3.

                  Section 1.3 "Business Day" means any day other than a
Saturday, Sunday, or other day on which commercial banks are authorized or
required to close under the laws of the State of Connecticut and/or federal law.

                  Section 1.4 "Commitment Letter" means Bank's undertaking to
enter into this Agreement for the benefit of Borrower contained in Bank's
Commitment Letter dated "REVISED August 27, 1999 as revised by a letter from
Borrower to Bank dated September 2, 1999 and as further revised and amended by
letter dated October 23, 1999.

                  Section 1.5 "Debt Service Coverage Ratio" shall be not less
than 1.25 to 1 and shall be calculated quarterly by Bank on a rolling quarterly
basis in accordance with the following formula: (1) the sum of: (a) net profit,
plus (b) depreciation and amortization, plus (c) interest expense for the
period, plus (d) expenses related to capital leases, minus (e) dividends paid in
cash, minus (f) capital expenditures paid for out of internally generated funds;
divided by (2) the sum of: (a) interest expense for the period paid in cash,
plus (b) maturities of long term debt
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scheduled to be paid during the period, plus (c) any expense related to lease
payments for the period. All of the above shall be calculated at the end of each
fiscal quarter for the four preceding quarters using the financial information
provided by Borrower.

                  Section 1.6 "Default" means any of the events specified in
Section 7.1, whether or not any requirement for the giving of notice, the lapse
of time, or both, or any other condition has been satisfied.

                  Section 1.7 "Eligible Receivables" means all accounts
receivable of Borrower from time to time existing excepting: receivables more
than sixty (60) days past invoice date; all receivables of the United States
government; and all receivables arising from services agreements which are not
then due and payable, whether or not they have been "earned" according to GAAP.
Bank may make a determination of the Eligible Receivables at any time and from
time to time in the exercise of its reasonable banking judgment, based upon
Borrower's timely monthly reporting to Bank.

                  Section 1.8 "Eligible Receivables Ratio" means the ratio of
eighty (80%) percent or less at any and all times during the term of this
Agreement between the then debit balance of the Loan Account and the then value
of the Eligible Receivables as determined by Bank in the exercise of its
reasonable banking judgment.

                  Section 1.9 "Event of Default" means any of the events
specified in Section 7.1, provided that any requirement for the giving of
notice, the lapse of time, or both, or any other condition, has been satisfied.

                  Section 1.10 "Guaranty" means the guaranty of the CDA relative
to the $500,000.00 Revolving Loan made or to be made to Borrower pursuant to
this Agreement.

                  Section 1.11 "Margin" means one and one-half (1.50%)
percentage points.

                  Section 1.12 "Prime Rate" means the per annum rate of interest
from time to time determined by Bank's Financial Division in the exercise of its
sole and exclusive judgment based upon

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funding sources ordinarily used by Bank and/or upon national and regional
indices as made generally known by Bank's Financial Division to Bank's lending
staff. The "Prime Rate" is an interest rate of general application but it is not
necessarily the best or lowest rate made available to its customers.

                  Section 1.13 "Interest Rate" means the Prime Rate from time to
time in effect PLUS the Margin.

                  Section 1.14 "Lien" means any mortgage, deed of trust, pledge,
security interest, hypothecation, assignment, deposit arrangement, encumbrance,
lien (statutory or other), or encumbrance of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable law of any jurisdiction to evidence any of
the foregoing).

                  Section 1.15 "Loan(s)" means all advances made by Bank
pursuant to the terms of this Agreement, whether to Borrower or to any third
party, including Bank, pursuant to any express provision of the Loan Documents.

                  Section 1.16 "Loan Account" means the account of Borrower on
the books of Bank in which Bank shall record: all loans made by Bank to Borrower
pursuant to this Agreement, interest, charges, expenses and other items
chargeable to Borrower pursuant to this Agreement, payments made on such loans
by Borrower, and other appropriate debits and credits as provided herein.

                  Section 1.17 "Loan Documents" means this Agreement, the
Commitment Letter, the Note, the Security Agreement, the Guaranty and any other
documents executed by, on behalf of, or for the benefit of Borrower or the CDA
in connection with the transaction which is the subject hereof.

                  Section 1.18 "Maturity Date" means August 31, 2000.

                  Section 1.19 "Obligations" mean any and all indebtedness,
obligations and liabilities of Borrower to Bank of every kind and description,
absolute or contingent, due or to

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become due, whether for payment or performance, now existing or hereafter
arising, including without limitation all loans, interest, taxes, fees, charges,
expenses and reasonable attorneys fees chargeable to Borrower or incurred by
Bank hereunder.

                  Section 1.20 "Person" means an individual partnership,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority, or other entity of whatever
nature.

                  Section 1.21 "Note" means that certain "Promissory Note"
(Revolving Credit Facility) executed by Borrower of even date herewith regarding
the Loans made or to be made to Borrower pursuant to this Agreement.

                  Section 1.22 "Security Agreement" means that certain "Security
Agreement" executed by Borrower of even date herewith, together with the UCC-1
Financing Statements and all subordination agreements executed in connection
therewith, all with respect to collateralizing the Loans made or to be made
pursuant to this Agreement.

                                   ARTICLE II
                          AMOUNT AND TERMS OF THE LOANS

         Section 2.1 Revolving Loans. The Bank agrees on the terms and
conditions hereinafter set forth, to make one or more Loans to the Borrower from
the date hereof through (but not including) the Maturity Date in an aggregate
amount not to exceed at any time outstanding the Borrowing Limit. At all times
the proceeds of each Loan shall be utilized for commercial purposes and in
support of the business operations of Borrower in the normal course, only.

         Section 2.2 Interest. The Borrower shall pay interest to the Bank on
the outstanding and unpaid principal amount of the Loans, as evidenced by the
Loan Account, at the Interest Rate from time to time in effect. Any change in
the Interest Rate resulting from a change in the Index shall become effective as
of the opening of business on the first Business Day following such change
without notice or demand. Interest shall be calculated on a daily basis and
calculated on the basis of a three hundred sixty (360) day year for the actual
number of days elapsed. Interest shall be paid in arrears on a monthly basis
from the date of the

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first Loan hereunder, commencing on the first day of the month immediately
following the initial loan. Any error in, or failure to provide a monthly
invoice for interest accrued shall not relieve the Borrower of its
responsibilities for payment of accrued interest as herein provided.

         The above notwithstanding, upon the occurrence and during the
continuance of an Event of Default, any principal amount not paid when due (at
maturity, by acceleration, or otherwise) shall bear interest until paid at a
rate which shall be five (5.00%) percent above the rate which would otherwise be
applicable.

         Section 2.3 Loan Account. The indebtedness of Borrower to Bank
hereunder shall be evidenced by a Promissory Note and the Loan Account. Bank
shall enter as debits to the Loan Account all loans, charges, expenses and other
items chargeable to Borrower hereunder; and shall enter as credits to the Loan
Account all payments made by Borrower on account of indebtedness evidenced by
the Loan Account, and other appropriate debits and credits.

         Section 2.4 Loans in Excess of Borrowing Limit. If at any time the
outstanding principal balance advanced to Borrower hereunder exceeds the
Borrowing Limit, Borrower shall immediately pay cash to Bank to be credited to
the Loan Account in an amount necessary to reduce the outstanding principal
balance hereunder to the Borrowing Limit.

         Section 2.5 Loans in Excess of Ratio. If at any time the Eligible
Receivables Ratio and/or Debt Service Ratio are exceeded, Borrower shall
immediately pay cash to Bank to be credited to the Loan Account in an amount
necessary to reduce the Eligible Receivables Ratio to eighty (80%) percent or
less and/or increase the Debt Service Coverage Ratio to 1.25x or greater.

         Section 2.6 Principal Payments; Maturity Date. Borrower shall pay to
the Bank all principal sums then outstanding with respect to the Loans on the
Maturity Date, together with all accrued but unpaid interest and all other
charges due hereunder or as provided in the Loan Documents.

         Section 2.7 Application of Payments. All payments received by Bank
shall be applied first to the payment of interest and all charges and expenses
payable by Borrower hereunder (in such order as Bank may determine) and the
balance, if any, shall be applied

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to principal.

         Section 2.8 Late Charges. Any payment received more than ten (15) days
after its due date shall be subject to an additional charge of five (5.00%)
percent of the amount due.

         Section 2.9 Prepayments. Borrower may prepay the Note in whole or in
part at any time, with accrued interest to the date of such prepayment on the
amount prepaid without penalty.

         Section 2.10 Termination of Future Advances. Anything contained in this
Agreement or the Note to the contrary notwithstanding, the Bank shall have the
right to refuse to make any further advances or Loans as provided hereunder or
in the Note upon the occurrence of any Event of Default under this Agreement,
the Note, the Security Agreement, or any other documents further evidencing or
securing the Loans, or in the event that there has been a default by Borrower
under the terms of any other financing or loan arrangement between Bank and
Borrower which has continued beyond any applicable grace or cure periods
expressly provided for.

                                   ARTICLE III
                          CONDITION PRECEDENT TO LOANS

         Section 3.1 Reaffirmation of Representations and Warranties. Each
request for a Loan shall constitute a reaffirmation by Borrower that all
representations and warranties herein contained are, in all material respects,
true and accurate as of the date of such request.

         Section 3.2 Borrowing Limit. The obligation of the Bank to make Loans
is subject to the condition that the Loan when made shall not cause the
outstanding principal balance advanced to Borrower hereunder to exceed the
Borrowing Limit.

         Section 3.3 Eligible Receivable Compliance with Ratios. The obligation
of the Bank to make Loans is subject to the condition that the Loan when made
shall not cause the Eligible Receivable Ratio to exceed eighty (80%) percent and
that the Debt Service Coverage Ratio shall not be less than 1.25x.

         Section 3.4 Reporting. The obligation of the Bank to make

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Loans is subject to the condition that Borrower has timely filed its monthly
reports to Bank relative to Eligible Receivables.

         Section 3.5 Absence of Default. The obligation of the Bank to make
Loans is subject to the condition that no Event of Default be existing Borrower
is not then in default under the terms of this Agreement, the Note, the Security
Agreement or any other document further evidencing or securing the Loans,
whether or not the Bank has elected to accelerate the Loans or otherwise seek
enforcement of its remedies.

         Section 3.6 Reaffirmation of Covenants. Each request for a Loan shall
constitute a reaffirmation by Borrower that Borrower is then complying with the
covenants contained in Articles V and VI of this Agreement.

                                   ARTICLE IV
                         REPRESENTATIONS AND WARRANTIES

         The Borrower represents and warrants to the Bank that:

         Section 4.1 Legally Enforceable Agreement. This Agreement is, and each
of the other Loan Documents when delivered under this Agreement will be, legal,
valid and binding obligations of the Borrower, enforceable against the Borrower
in accordance with their respective terms, except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency, or other
similar laws affecting creditor's rights generally.

         Section 4.2 Financial Statements. The financial statements of the
Borrower as furnished to the Bank are complete and correct and fairly present
the financial condition of the Borrower as of such dates and periods covered by
such statements. There has been no material adverse change in the financial
condition of the Borrower since June 30, 1999, the date of the latest financial
statement provided Bank by Borrower. There are no liabilities of the Borrower,
fixed or contingent, which are material but are not reflected in the financial
statements. No information furnished by the Borrower to the Bank in connection
with the negotiation of this Agreement contained any material misstatement of
fact or omitted to state a material fact or any fact necessary to make the
statement contained therein not materially misleading.

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         Section 4.3 Other Agreements. The Borrower is not now a party to any
indenture, loan, or loan agreement, or to any lease or other agreement or
instrument, or subject to any restriction which could have a material adverse
effect on its assets or financial condition, or its ability to carry out the
obligations under the Loan Documents. The Borrower is not in default in any
respect in the performance, observance, or fulfillment of any of the obligations
covenants, or conditions contained in any agreement or instrument material to
which it is a party.

         Section 4.4 Litigation. There is no pending or threatened action or
proceeding against or affecting the Borrower before any court, governmental
agency, or arbitrator which may, in any one case or in the aggregate, materially
adversely affect the financial condition of the Borrower or its ability to
perform the obligations under the Loan Documents.

         Section 4.5 No Defaults on Outstanding Judgments or Orders. The
Borrower has satisfied all judgments and is not in default with respect to any
judgment, writ, injunction, decree, rule, or regulation of any court,
arbitrator, or federal, state, or municipal instrumentality, domestic or
foreign.

         Section 4.6 Ownership and Liens. The Borrower has title to, or valid
leasehold interest in, all of its properties and assets as reflected in the
financial statements provided to the Bank, and no such properties or assets are
subject to any lien or encumbrance not disclosed therein.

         Section 4.7 Taxes. The Borrower is current on all obligations to pay
taxes, including without limitation property taxes, income taxes, sales taxes
and all other taxes arising in connection with its property and is not aware of
any liability for taxes other than currently accruing taxes.

         Section 4.8 Compliance with Law. The Borrower is not aware of any
violations of law on their part in connection with its assets.

         Section 4.9 Capacity. That the Borrower is a corporation formed under
the laws of the State of Delaware and is in all respects in good standing.

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                                    ARTICLE V
                              AFFIRMATIVE COVENANTS

         So long as the Note shall remain unpaid or the Bank shall have any
Commitment under this Agreement, the Borrower will:

         Section 5.1 Financial Statements. Timely submit to Bank the following
financial information: internally prepared financial statements (balance sheet,
statement of income and retained earnings) on a monthly basis within thirty (30)
days following the end of the preceding month; audited financial statements
annually within one hundred twenty (120) days after the end of Borrower's fiscal
year; and notice of all filings made to the Securities and Exchange Commission,
with copies of such filings upon written request of Bank, within twenty (20)
days of such filing or request.

         Section 5.2 Accounts Receivable Reporting. Timely submit to Bank
monthly reports of Accounts Receivable within fifteen (15) days of the end of
each calendar month.

         Section 5.3 Compliance with Laws. Comply, in all material respects with
all applicable laws, rules, regulations, and orders, such compliance to include,
without limitation, paying before the same become delinquent all taxes,
assessments, and governmental charges imposed upon its property.

         Section 5.4 Compliance with Loan Documents. Comply with all obligations
under the Loan Documents including but not limited to the maintenance of the
required Eligible Receivables Ratio and the required Debt Service Coverage
Ratio.

         Section 5.5 Bank Account. Maintain all operating accounts of the
Borrower with the Bank, including a deposit account with the Bank into which the
Bank may deposit advances made pursuant hereto and to the Promissory Note. The
Borrower acknowledges and agree that the maintenance of the operating accounts
with the Bank is required for collateral purposes and the Borrowers failure to
do so shall be a default hereunder.

                                   ARTICLE VI
                               NEGATIVE COVENANTS

         So long as the Note shall remain unpaid or the Bank shall

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have any Commitment under this Agreement, the Borrower will not without the
Bank's written consent:

         Section 6.1 Liens. Create, incur, assume, or suffer to exist, any Lien
upon or with respect to any personal property pledged to the Bank pursuant to
the terms of the Security Agreement, except:

                  (1)  Liens in favor of the Bank;

                  (2) Liens for taxes or assessments or other government charges
or levies if not yet due and payable or, if due and payable, if they are being
contested in good faith by appropriate proceedings and for which appropriate
reserves are maintained.

                  (3) Liens for the acquisition of new personal property in the
normal course of the Borrower's business.

                  (4) Purchase money liens in the normal course of Borrower's
business.

                  (5) Such liens as are set forth in Exhibit A attached hereto
and incorporated herein.

         Section 6.2 Sale of Assets. Sell, lease, assign, transfer, pledge or
otherwise dispose of any personal property pledged to the Bank pursuant to the
terms of the Security Agreement except in the normal course of the Borrower's
business, unless said Property is replaced with a like asset of equal or greater
value.

                                   ARTICLE VII
                       EVENTS OF DEFAULT AND ACCELERATION

         Section 7.1. The occurrence of any one or more of the following events
shall constitute an Event of Default hereunder:

                  (1) Default in the payment of any principal, interest or other
charges in respect of any of the Obligations within fifteen (15) days of the due
date thereof.

                  (2) Default in the observance or performance or any
undertaking of Borrower set forth in Article V herein which shall continue for a
period of thirty (30) days after notice of such

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default by the Bank to the Borrower.

                  (3) Default in the observance or performance of any
undertaking of Borrower set forth in Article VI hereof.

                  (4) Default in the observance or performance of any
undertaking of Borrower herein set forth or set forth in the Note, the Security
Agreement or any other document further evidencing or securing the Loans which
are not otherwise specifically addressed in this Section 7.1 and which default
shall continue for a period of thirty (30) days after notice of such default
from Bank to Borrower.

                  (5) If any representation, warranty or information made or
furnished by Borrower to Bank is or shall be untrue or misleading in any
material respect.

                  (6) If Borrower shall have made an assignment for the benefit
of creditors, or if a petition in bankruptcy or to effect a plan or arrangement
with creditors is filed by or against Borrower; or if Borrower shall apply for
or permit the appointment of a receiver or trustee for any of its property or
assets, or if any such receiver or trustee shall have been appointed for any of
its property or assets; or if any of the above actions or proceedings whatsoever
are commenced by or against Borrower. Notwithstanding the above, Borrower shall
have sixty (60) days to dismiss or otherwise cure any involuntary petition or
other involuntary action filed or commenced against it.

                  (7) Default under the terms of any other financing or loan
facility between the Bank and the Borrower, including but not limited to that
certain $200,000.00 facility with respect to Standby Letters of Credit of even
date herewith which default continues beyond any applicable grace or cure
period.

         Section 7.2. If any Event of Default shall occur, then or at any time
thereafter, while such Event of Default shall continue, or at any time Bank
shall in good faith determine that the prospect of payment or performance by
Borrower under the documentation further evidencing or securing the Loan
evidenced hereby is impaired, the Bank may declare all Obligations to be due and
payable, without notice, protest, presentment or demand, all of which are hereby
expressly waived by Borrower.

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                                  ARTICLE VIII
                               RIGHTS AND REMEDIES

         Section 8.1.  During the continuance of an Event of Default:

                  (1) Bank shall have the right, without notice, to set off any
and all deposits or other sums at any time or times credited by or due from Bank
to Borrower, including certificates of deposit, whether in a special account or
other account, which deposits and other sums shall at all times constitute
security for the Obligations which are then due. Any and all instruments,
documents, policies and certificates of insurance, securities, goods, contracts
and contract rights, accounts receivable, general intangibles, chattel paper,
cash and property and the proceeds of any of the foregoing owned by Borrower or
in which Borrower now or hereafter has an interest, which now or hereafter are
at any time in possession or control of Bank or in transit by mail or carrier to
or from Bank or in the possession of any third party acting in or on behalf of
Bank, without regard to whether Bank received the same in pledge, for
safekeeping, as agent for collection or transmission or otherwise (including
computer records) or whether Bank had conditionally released the same, shall
constitute security for the Obligations and may be applied at any time to any
matured Obligations.

                  (2) The Bank shall have all of the rights and remedies set
forth in any other document evidencing or securing the Loans.

                  (3) The foregoing remedies shall not be exclusive, but shall
be cumulative, and shall not diminish or impair any other rights and remedies
available to the Bank at law or in equity.

                                   ARTICLE IX
                                  MISCELLANEOUS

         Section 9.1 Term of Agreement. The term of this Agreement shall
commence on the date hereof and shall continue until all Obligations shall have
been fully paid and satisfied.

         Section 9.2. The failure of Bank at any time or times to require strict
performance by Borrower of any of the provisions, warranties, terms, covenants,
and conditions contained herein for

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any other instrument or document now or at any time or times hereafter executed
by Borrower and delivered to Bank shall not waive, affect or diminish any right
of Bank at any time or times to demand strict performance thereof; no rights of
Bank hereunder shall be deemed to have been waived unless such waiver is in
writing signed by an officer of Bank. No waiver by Bank of any of its rights
shall operate as a waiver of any other of its rights or any of its rights on a
future occasion.

         Section 9.3. Any demand, consent, approval or notice given hereunder
(collectively "Notice")shall be given in writing (regardless of whether so
specified in other provisions of this Agreement) and shall be delivered (i) by
United States certified mail, postage prepaid, return receipt requested or (ii)
by nationally recognized overnight courier which provides for a signature upon
receipt of deliveries and shall be deemed given upon receipt or upon refusal or
acceptance. Notice shall be delivered to the following addresses:

         TO BORROWER:
                         Gunther International, Ltd.
                         One Winnenden Road
                         Norwich, CT  06360
                         Attention:  President

         With a copy simultaneously delivered to:

                         Murtha, Cullina, Richter and Pinney, LLP
                         185 Asylum Street
                         Hartford, Connecticut  06103
                         Attention:  Richard S. Smith, Jr.,
                                     Esquire

         TO BANK:

                         People's Bank
                         4 Broadway
                         Norwich, Connecticut  06360
                         Attention: Arthur C. Barton

         With a copy simultaneously delivered to:

                         Brown, Jacobson, Tillinghast, Lahan &
                            King, P.C.

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<PAGE>   14
                         22 Courthouse Square
                         Norwich, Connecticut  06460
                         Attention: Karl-Erik Sternlof, Esquire

or to such other address as may be provided by such party, in manner aforesaid.

         Section 9.4. This Agreement contains the entire understanding between
the parties hereto with respect to the transactions contemplated herein and such
understanding shall not be modified except in writing signed by the parties
hereto.

         Section 9.5. The provisions of this Agreement shall be binding and
shall inure to the benefit of the successors and assigns of Bank and the
Borrower, provided however, Borrower may not assign any of its rights nor
delegate any of its duties hereunder without the prior written consent of the
Bank which shall be given or withheld in the sole reasonable discretion of the
Bank.

         Section 9.6. This Agreement has been made and delivered in the State of
Connecticut, and shall be construed in all respects in accordance with and
governed by the laws and decisions of that State.

         Section 9.7. If Bank shall employ counsel in connection with the
execution and consummation of the transactions contemplated by this Agreement or
to take any action in or with respect to any suit or proceeding (bankruptcy or
otherwise) relating to this Agreement, or to enforce any other rights of the
Bank hereunder, whether before or after the occurrence of any Event of Default,
or to collect any of the Obligations, then in any of such events, all reasonable
attorneys fees and any expenses, costs and charges relating thereto, shall be
part of the Obligations, payable on demand.

         Section 9.8. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute but one and the same instrument.

         Section 9.9. The section headings herein are included for convenience
only and shall not be deemed to be a part of this Agreement.

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<PAGE>   15
         Section 9.10. Each reference herein made to Bank shall be deemed to
include its successors and assigns, and each reference to Borrower and any
pronouns referring thereto as used herein shall be deemed to include the
successors and assigns of Borrower, all of whom shall be bound by the provisions
hereof.

         Section 9.11. THE UNDERSIGNED HEREBY WAIVE TRIAL BY JURY IN ANY WAY
RELATED TO THE TRANSACTION OF WHICH THIS AGREEMENT IS A PART.

         BORROWER ACKNOWLEDGES THAT THE LOAN EVIDENCED BY THIS NOTE IS A
COMMERCIAL TRANSACTION AND WAIVES ITS RIGHTS TO NOTICE AND HEARING UNDER CHAPTER
903a OF THE CONNECTICUT GENERAL STATUTES, OR AS OTHERWISE ALLOWED BY THE LAW OF
ANY STATE OR FEDERAL LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH BANK MAY
DESIRE TO USE, AND FURTHER, WAIVES DILIGENCE, DEMAND, PRESENTMENT FOR PAYMENT
AND, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED FOR HEREIN, NOTICE OF NONPAYMENT,
PROTEST AND NOTICE OF PROTEST, AND NOTICE OF ANY RENEWALS OR EXTENSIONS OF THIS
AGREEMENT, AND ALL RIGHTS UNDER ANY STATUTE OF LIMITATIONS, AND AGREE THAT THE
TERMS OF BORROWER'S OBLIGATIONS UNDER THIS AGREEMENT MAY BE CHANGED AND EXTENDED
AT BANK'S SOLE DISCRETION, WITHOUT IMPAIRING THEIR LIABILITY THEREON, AND
FURTHER CONSENT TO THE RELEASE OF ALL OR ANY PART OF THE SECURITY FOR THE
PAYMENT HEREOF AT THE DISCRETION OF BANK, OR THE RELEASE OF ANY PARTY LIABLE FOR
THIS OBLIGATION WITHOUT AFFECTING THE LIABILITY OF BORROWER. ANY DELAY ON THE
PART OF THE BANK IN EXERCISING ANY RIGHT HEREUNDER SHALL NOT OPERATE AS A WAIVER
OF ANY SUCH RIGHT, AND ANY WAIVER GRANTED FOR ONE OCCASION SHALL NOT OPERATE AS
A WAIVER IN THE EVENT OF ANY SUBSEQUENT DEFAULT.

         Section 9.12 Conflict with Law. In the event that the rights and
remedies of the Bank herein conflict with any federal or state laws and
regulations applicable to consumer loans, the provisions of such laws and
regulations shall take precedence.

                                    ARTICLE X
                                   ASSIGNMENT

         Section 10.1 Assignment by Bank. If at any time or times by assignment
or otherwise the Bank transfers or assigns any Obligations, such transfer shall
carry with it the powers and rights of the Bank under this Agreement with
respect to the

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<PAGE>   16
Obligations assigned or transferred and the assignee or transferee shall become
vested with said powers and rights whether or not they are specifically referred
to in the transfer or assignment. If and to the extent the Bank retains any
Obligations, the Bank shall continue to have the rights of powers herein set
forth with respect thereto.

         Section 10.2 Assignment by Borrower. The Borrower may not assign its
rights or obligations under this Agreement without the prior written approval of
the Bank which shall be given or withheld in the sole reasonable discretion of
the Bank.

         IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
as of the 23rd day of October, 1999.

In the presence of:
                                            GUNTHER INTERNATIONAL, LTD.

/s/ Frank J. Saccomandi, III                By    /s/ Michael M. Vehlies
----------------------------                   ---------------------------------
                                               Its Chief Financial Officer
/s/ Karl-Erik Sternlof
----------------------------

                                            PEOPLE'S BANK

/s/ Frank J. Saccomandi, III                  /s/ Arthur C. Barton
----------------------------                ------------------------------------
                                            Arthur C. Barton
                                            Its Vice President
/s/ Karl-Erik Sternlof
----------------------------

                                      -16-<PAGE>   1

                               SECURITY AGREEMENT

         AGREEMENT dated as of the 23rd day of October, 1999, by and between
GUNTHER INTERNATIONAL, LTD., a Connecticut corporation with its principal place
in the Town of Norwich, County of New London and State of Connecticut, (herein
referred to as "Debtor"), and PEOPLE'S BANK, a Connecticut stock savings bank
with a principal place of business at 850 Main Street, Bridgeport, Connecticut,
(herein referred to as "Bank").

         WHEREAS, Debtor has requested Bank to make loans and financing
available to Debtor, and

         WHEREAS, Bank has agreed to do so on certain conditions, including,
without limitation, the granting of certain security interests and rights and
the making of certain representations and covenants by Debtor.

                               W I T N E S S E T H

         NOW, THEREFORE, Debtor and Bank agree as follows:

         (1) GRANT OF SECURITY INTEREST.

             (a) Debtor hereby grants to the Bank a security interest in all
personal property now or hereafter owned or acquired by Debtor, including but
not limited to Accounts, Chattel, Paper, Documents, Equipment, Fixtures, General
Intangibles, Instruments and Inventory as more particularly described on Exhibit
A attached hereto and incorporated herein (the "Collateral"). This grant is made
to secure the payment and performance of any and all existing and future
obligations and liabilities of Debtor to Bank relating in any way to that
certain note of even date herewith in the amount of $500,000.00 made by Debtor
to the order of Bank (the "Note") pursuant to the terms of that certain
Commercial Revolving Loan Agreement of even date herewith between Debtor and
Bank (the "CRLA"), copies of which Note and which CRLA are attached hereto and
marked as Exhibit "B" and "C", or to any other document evidencing the
obligations thereunder or securing same. As used in this Agreement,
"Liabilities" or "Obligations" mean any and all indebtedness, obligations and
liabilities of Debtor (and any endorser, guarantor or surety

<PAGE>   2
of for Debtor) to Bank relative to the loan evidenced by said Note and CRLA of
every kind and description, direct or indirect, primary or secondary, absolute
or contingent due or to become due, now existing or hereafter arising,
regardless of how they arise or by what agreement or instrument further
evidencing or securing same they may be evidenced, or whether evidenced by any
agreement or instrument, including, without limitation, all costs incurred by
Bank to obtain, preserve and enforce this security interest, collect and enforce
the liabilities therein contained, and maintain and preserve collateral and
including, but not limited to, reasonable attorneys fees and legal expenses.

             (b) To the extent applicable, the Uniform Commercial Code of
Connecticut shall govern security interests provided for herein. In connection
therewith, the Debtor shall take such steps and execute and deliver such
financing statements, assignments and other papers as Bank may from time to time
request.

             (c) If, by reason of location of Collateral or otherwise, the
creation, validity or perfection of security interests provided for herein are
governed by the law of a jurisdiction other than Connecticut, the Debtor shall
take steps and execute and deliver such papers as Bank may from time to time
request to comply with such law.

             (d) As long as any Liabilities of the Debtor to Bank are
outstanding under this Agreement, the Debtor will not become obligated for any
loans or other grants of credit (except for merchandise purchased or services
rendered in the ordinary course of business) to any person other than Bank,
without Bank's prior written consent.

             (e) It is understood and agreed that all advances now or hereafter
made by the Bank to Debtor under the CRLA are hereby deemed to be secured by
this Agreement.

        (2)     PROMISES TO PAY.

                The Debtor promises to pay to Bank:

                (a) All Liabilities of Debtor to Bank in accordance

                                      -2-
<PAGE>   3
with their terms;

                (b) Any and all taxes, charges and expenses of every kind or
description paid or incurred by the Bank under or with respect to any
Liabilities or any Collateral therefor or the collection of or realization of
the same including costs of collection, attorneys fees, expenses of litigation
and otherwise.

        (3)     DEBTOR'S REPRESENTATIONS, WARRANTIES AND COVENANTS.

                In order to induce the Bank to make loans under the CRLA, Debtor
hereby represents, warrants and covenants to the Bank that:

                (a) Except as provided in Exhibit C attached hereto and made a
part hereof and except for the security interests herein granted, no financing
statement has been filed with respect to the Collateral, Debtor is the absolute
and undisputed owner of the Collateral. Except as provided in Exhibit C hereto,
the Collateral is not, and will not be permitted to be in any respect encumbered
other than by this security interest (and the same will be true of collateral
acquired hereafter when acquired). All indebtedness to Debtor with respect to
any accounts receivable is bona fide and valid and no setoffs or counterclaims
exist against such indebtedness. No suits or actions are pending against Debtor,
and no claims, including, without limitation, taxes, assessments and insurance
premiums, are due and unpaid. Debtor's chief place of business is the address
shown above, and Debtor shall promptly give Bank written notice of any change
thereto, and the Collateral and business records pertaining to the Collateral
and Obligations, including those pertaining to all accounts and contract rights,
shall be kept at the above address of Debtor unless prior written consent of
Bank is obtained to a change of location.

                (b) Debtor shall [i] pay punctually all Obligations when due as
required by the terms of any notes or agreements, and if any Obligation is now
evidenced by a writing specifying a due date, pay the same upon demand, all
Obligations being payable to the Bank at its address shown above, and [ii] pay
on demand any and all taxes, charges and

                                      -3-
<PAGE>   4

expenses of every kind or description paid or incurred by Bank under or with
respect to loans made under the CRLA or any Collateral therefor or the
collection of or realization upon the same, including costs of collection,
attorneys fees, expenses of litigation and otherwise. Debtor hereby authorizes
the Bank to charge any and all liabilities owing to the Bank, including, without
limitation, the aforesaid interest, charges, taxes and expenses, to any of their
accounts with the Bank after and during the continuance of any Event of Default
as defined in the CRLA.

                (c) Debtor shall [i] preserve the Collateral in good condition
and order and not permit it to be abused or misused, [ii] insure the Collateral
for such hazards and in such amounts as the Bank reasonably directs, policies to
be satisfactory to and payable to Bank and providing a minimum of ten (10) days
written cancellation notice to the Bank, [iii] until contrary instructions from
Bank, collect the accounts, contracts, rights, chattel paper and other debts,
[iv] when and to the extent required by the Bank after and during the
continuance of an Event of Default as defined in the CRLA, notify other debtors
and obligors that their accounts, contract rights, instruments, documents and/or
chattel paper have been assigned to the Bank and shall be paid directly to the
Bank, [v] take necessary steps to preserve the liability of account debtors,
obligors and secondary parties whose liabilities are part of the Collateral,
[vi] take any action required by the Bank with reference to the Federal
Assignment of Claims Act, [vii] allow the Bank to inspect the Collateral and to
inspect and copy all records relating to the Collateral and Obligations, [viii]
upon request by the Bank and subject to the rights of the other secured lenders
listed on Exhibit C hereto, if any, sign any papers necessary to obtain,
preserve and enforce this security interest in any jurisdiction; transfer
possession of and assign all instruments, documents, patents and chattel paper,
which are part of the Collateral to the Bank immediately, or as to those
hereafter acquired, immediately following acquisition, [ix] perfect a security
interest (using a method satisfactory to Bank) in goods covered by any
instrument, document or chattel paper in the Collateral, [x] notify the Bank of
any change occurring in or any of the Collateral, or in any fact or circumstance

                                      -4-
<PAGE>   5
warranted or represented by Debtor herein, or furnished to the Bank, or if any
such Event of Default occurs, [xi] pay all costs necessary to perform any act or
duty required by this Agreement, including, but not limited to, attorneys fees,
insurance premiums, taxes and assessments. The Bank shall have the right to
execute any financing statement or other document necessary or advisable to
perfect an interest granted hereunder.

        (4)     CERTAIN RIGHTS OF BANK.

                The Bank shall, in addition to any other rights it may have by
law or under this Agreement, have the following rights:

                (a) At its option, after an Event of Default as defined in the
CRLA occurs, the Bank may, subject to the rights of the other Secured Parties
listed on Exhibit C hereto, if any: [i] take, and require Debtor to give to it,
possession or control of any of the Collateral and proceeds thereof, and apply
the same to payment of any of the Obligations, [ii] apply to any Obligations the
balance of Debtor's accounts, of whatever type, at the Bank, [iii] endorse as
Debtor's agent any instruments, documents, chattel paper in the Collateral, [iv]
notify account debtors and obligors of Debtor to pay directly to Bank, or to
verify information supplied by Debtor, [v] discharge any lien or encumbrance on
Collateral and exercise any other rights which an owner of the Collateral may
exercise and, [vii] take any of the foregoing actions, or any action Debtor is
required to take by this Agreement, without notice to Debtor, and add the costs
of the same to the Obligations, but Bank is under no duty to take any such
action.

                (b) Debtor hereby gives Bank a lien and right of setoff for all
Debtor's Liabilities upon or against all the deposits, credits, collateral and
property of Debtor now or hereafter in the possession or control of the Bank or
in transit to it. The Bank may at any time upon and during the continuance of
any Event of Default as defined in the CRLA apply or setoff the same, or any
part thereof, to any of Debtor's Liabilities even though unmatured.

                                      -5-
<PAGE>   6

        (5)     EVENTS OF DEFAULT:  ACCELERATION.

                Any and all of the Liabilities of Debtor to the Bank shall, at
the sole option of the Bank and notwithstanding any time or credit allowed by
any instrument evidencing a Liability, be immediately due and payable, without
notice or demand, upon the occurrence of any of the following events of default:
[i] the occurrence of an Event of Default under the CRLA and/or the Note; [ii]
loss, theft, damage, destruction (for which there is inadequate insurance
coverage), unauthorized sale or encumbrance to or of any of the Collateral, or
the making or issuance of any levy, seizure, attachment or injunction upon or
against any of the Collateral or any other property of Debtor; [iii] dissolution
or other termination of existence or (iv) if Bank in good faith determines the
prospect of payment or performance by Debtor under the CRLA and/or the Note is
impaired.

        (6)     POWER TO SELL OR COLLECT COLLATERAL.

                Upon the occurrence of any Event of Default as defined in the
CRLA, all Obligations shall, at Bank's sole option, become immediately due and
payable, anything in any note evidencing any such Obligation or in this
Agreement or in any other agreement to the contrary notwithstanding, without
notice to Debtor, and Bank shall have, in any jurisdiction where enforcement
hereof is sought, in addition to any other rights and remedies which Bank may
have under law, the following rights and remedies, all of which may be exercised
with or without further notice to Debtor but subject to the rights of the other
secured lenders as set forth in Exhibit C hereto, if any: [i] to notify any and
all obligors on accounts receivable that the same have been assigned to the Bank
and that all payments thereon are to be made directly to the Bank, [ii] to
settle, compromise or release on terms acceptable to the Bank, in whole or in
part, any amounts owing on accounts receivable and to enforce payment and
prosecute any action or proceeding with respect to any and all accounts
receivable, [iii] to extend the time of payment, make allowances and adjustments
and to issue credits in the Bank's name or in the name of Debtor, [iv] to
foreclose the liens and security interests created under this Agreement or under
any other agreement relating to  Collateral by any available judicial
procedure or without judicial process, to enter any premises where any of the

                                      -6-
<PAGE>   7
Collateral may be located for the purpose of taking possession of or removing
the same, [v] to sell, assign, lease or otherwise dispose of the Collateral or
any part thereof, either at public or private sale or at any broker's board, in
lots or in bulk, for cash, on credit or otherwise, with or without
representations or warranties and upon such terms as shall be acceptable to the
Bank, all at the Bank's sole option and as the Bank, in its sole discretion, may
deem advisable and the Bank may bid or become purchaser at any such sale if
public, free from any right of redemption which is hereby expressly waived by
Debtor, and the Bank shall have the right, at its option, to apply or be
credited with the amount of all or any part of the Liabilities owing to the Bank
against the purchase price bid by the Bank at any such sale. Subject to the
right of the other secured lenders as set forth in Exhibit C hereto, if any, The
net cash proceeds resulting from the collection, liquidation, sale, lease or
other disposition of Collateral shall be applied first to the expenses
(including all attorneys fees) or retaking, holding, storing, processing and
preparing for sale, selling, collecting, liquidating and the like, and then to
the satisfaction of all Liabilities, application as the particular Liabilities
or against principal or interest to be in the Bank's discretion. Debtor shall be
liable to the Bank and shall pay the Bank on demand any deficiency which may
remain after such sale, disposition, collection or liquidation of Collateral,
and the Bank in turn agrees to remit to Debtor any surplus remaining after all
Liabilities have been paid in full. If any of the Collateral shall require
repairing, maintenance, preparation, or the like, or is in the process or other
unfinished state, the Bank shall have the right, but shall not be obligated, to
do such repairing, maintenance, preparation, processing or completion of
manufacturing for the purpose of putting the same in such saleable form as the
Bank shall deem appropriate, but the Bank shall have the right to sell or
dispose of such Collateral without such processing. Subject to the rights of the
other secured lenders as set forth in Exhibit C hereto, if any, Debtor will, at
the Bank's request, assemble all Collateral and make it available to the Bank at
places which the Bank may select whether at premises of Debtor or

                                      -7-
<PAGE>   8
elsewhere, and will make available to the Bank all premises and facilities of
Debtor for the purpose of Bank's taking possession of Collateral or of removing
or putting the Collateral in saleable form. In the event any goods called for in
any sales order, contract, invoice or other instrument or agreement evidencing
or purporting to give rise to any accounts receivable included in any assignment
submitted to the Bank for Collateral purposes shall not have been delivered or
shall be claimed to be defective by any customer, the Bank shall have the right,
in its sole discretion, to use and deliver to such customer any goods of Debtor
to fulfill such order, contract, or the like, so as to make good any such
accounts receivable. To facilitate the exercise by the Bank of the rights and
remedies set forth in this Paragraph, Debtor hereby constitutes Bank or its
agents, or any other person whom Bank may designate, as attorney-in-fact for
Debtor at Debtor's own cost and expense, to exercise all or any of the following
powers subject to the rights of the other secured lenders as set forth in
Exhibit C hereto, if any, which being coupled with an interest, shall be
irrevocable, shall continue until all Liabilities have been paid in full and
shall be in addition to any other rights and remedies that the Bank may have:
[i] to remove from any premises where the same may be located, any all
documents, instruments, files and records, and any receptacles and cabinets
containing the same, relating to Collateral, and the Bank may, at Debtor's cost
and expense, use such of the personnel, supplies and space of Debtor at its
place of business as may be necessary to properly administer and control the
Collateral or the handling of collections and realizations thereon; [ii] to
receive, open and dispose of all mail addressed to Debtor and to notify postal
authorities to change the address for delivery thereof to such address as the
Bank may designate; [iii] to take or bring, in the Bank's name or in the name of
Debtor, all steps, actions, suits or proceedings deemed by the Bank necessary or
desirable to effect collection of or to realize upon the Collateral; and [iv] to
collect or withdraw all sums of money or other solvent credits Debtor may have
to its credit with any banking institution.

        (7)     WAIVERS.

                                      -8-
<PAGE>   9

                (a) Debtor waives presentment, demand, notice, protest, notice
of acceptance of this Agreement, notice of loans made, credit extended,
collateral received or delivered or other action taken in reliance hereon and
all other demands and notices of any description. With respect both to
Liabilities and Collateral, Debtor assents to any extension or postponement of
the time of payment or any other indulgence, to any substitution, exchange, or
release of Collateral, to the addition or release of any party or person
primarily or secondarily liable, to the acceptance of partial payments thereon
and the settlement, compromising or adjusting of any thereof, all in such manner
and at such time or times as the Bank may deem advisable. The Bank shall have no
duty as to the collection or protection of Collateral or any income thereon, nor
as to the preservation of rights against prior parties, nor as to the
preservation of any rights pertaining thereto beyond the safe custody thereof.
The Bank may exercise its rights with respect to Collateral without resorting or
regard to other Collateral or sources of reimbursement for any Liability. The
Bank shall not be deemed to have waived any of its right upon or under
Liabilities or Collateral unless such waiver be in writing and signed by the
Bank. No delay or omission on the part of the Bank in exercising any right shall
operate as a waiver of such right or any other right. A waiver on any one
occasion shall not be construed as a bar to or waiver of any right on any future
occasion. The Bank may revoke any permission or waiver previously granted to
Debtor, such revocation shall be effective whether given orally or in writing.
All rights and remedies of the Bank on Liabilities or Collateral, whether
evidenced hereby or by any other instrument or papers, shall be cumulative and
may be exercised singularly or concurrently.

                (b) The Bank shall not, under any circumstances or in any event
whatsoever, have any liability for any error or omission or delay of any kind
occurring in the liquidation of any Collateral, including the settlement,
collection or payment of any collateral accounts or any instrument received in
payment thereof, or any damage resulting therefrom. Debtor shall indemnify and
hold harmless the Bank against any claim, loss or damage arising out of said
liquidation of any Collateral, including the settlement, collection or payment
of

                                      -9-
<PAGE>   10
any collateral accounts or any instrument received in payment thereof.

                (c) DEBTOR ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS
AGREEMENT IS A PART IS A COMMERCIAL TRANSACTION, AND HEREBY WAIVES ITS RIGHT TO
NOTICE WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH THE BANK OR ITS SUCCESSORS
OR ASSIGNS MAY DESIRE TO USE.

        (8)     MISCELLANEOUS.

                This Agreement shall become effective upon execution by the
parties hereto. No modification or amendment hereof shall be effective unless
the same shall be in writing and signed by the parties hereto. Definitions in
the Uniform Commercial Code of Connecticut shall apply to words and phrases
herein; if Code definitions conflict, Article 9 definitions apply. Debtor waives
presentment, demand, notice of dishonor, protest and extension of time without
notice as to any instrument, document or chattel paper in Collateral and notice
of any action taken by the Bank hereunder unless such notice is mandatory under
applicable law. Any notice to the Bank shall be effective only upon its receipt
by the Bank. Any demand upon or notice to Debtor that the Bank may elect to give
shall be effective if deposited in the mails or delivered to a telegraph,
wireless or radio company, addressed to Debtor at the address shown at the
beginning of this Agreement, or if Debtor has notified Bank in writing of a
change of address, to Debtor's last address so notified, or to address to which
the Bank customarily communicates with Debtor. The rights and privileges of the
Bank shall inure to its successors and assigns. This Agreement or any other
agreement or note executed with reference hereto, if signed by or on behalf of
more than one person as Debtor, endorser, guarantor, or surety for Debtor, shall
bind jointly and severally the persons signing or on whose behalf same is
signed, their personal representatives, heirs, successors and assigns. If any
provision of this Agreement is invalid or unenforceable under applicable law,
the provision is and will be totally ineffective to that extent, but the
remaining provisions will be unaffected. As used herein, plural or singular
include each other and pronouns in any gender are to be construed as masculine,
feminine or neuter, as context

                                      -10-
<PAGE>   11
requires. This Agreement has been made in the State of Connecticut and construed
in accordance with the laws of the State. The section headings are for
convenience only and of no substance, and no significance to any section heading
shall be given in construction of interpretation of this Agreement.

        IN WITNESS WHEREOF, the parties have hereunto signed this Agreement as
of the day and year first above written.

Signed, Sealed and Delivered in the presence of:
                                                    GUNTHER INTERNATIONAL, LTD.
 /s/ Frank J. Saccomandi, III
 ----------------------------

                                                    By /s/ Michael M. Vehlies
                                                    -------------------------
 /s/ Karl-Erik Sternlof                             Its
 ----------------------                             Duly Authorized

 /s/ Frank J. Saccomandi, III                       PEOPLE'S BANK
 ----------------------------

 /s/ Karl-Erik Sternlof                            By  /s/ Arthur C. Barton
 ----------------------                            ----------------------
                                                   Its
                                                   Duly Authorized

STATE OF CONNECTICUT:
                     :  ss.  Norwich
COUNTY OF NEW LONDON:

        On this the 8th day of November, 1999, personally appeared Michael
Vehlies, who acknowledged himself/herself to be the Chief Financial Officer of
GUNTHER INTERNATIONAL, LTD., a Connecticut corporation, and who acknowledged
that as such he/she subscribed the foregoing instrument for the purposes therein
contained, as his/her free act and deed and the free act and deed of said
corporation, before me.

                                           /s/ Frank J. Saccomandi, III
                                           ----------------------------
                                           Commissioner of the Superior Court/

                                      -11-
<PAGE>   12
STATE OF CONNECTICUT:
                     :  ss.  Norwich    October 23, 1999
COUNTY OF NEW LONDON:

        Personally appeared Arthur C. Barton, who acknowledged himself/herself
to be an Officer of PEOPLE'S BANK, and who acknowledged that as such he/she
subscribed the foregoing Agreement for the purposes therein contained, as
his/her free act and deed and the free act and deed of said Bank, before me,

                                           /s/ Karl-Erik Sternlof
                                           ----------------------
                                           Commissioner of the Superior Court
                                           Notary Public
                                           My Commission Expires:

                                      -12-

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