Exhibit 10.21
 
CONSENT AND WAIVER AGREEMENT
 
  This Consent and Waiver Agreement (“Agreement”) is made and entered into as of
June 4, 2012, by and among DecisionPoint Systems, Inc., a Delaware corporation
(the “Company”), Sigma Opportunity Fund II, LLC (“Sigma Opportunity Fund”),
Sigma Capital Advisors (“Sigma Advisors”) and Donald W. Rowley.
 
WHEREAS, the Company and the Sigma Opportunity Fund are parties to an Exchange
Agreement dated as of June 30, 2011 (the “Exchange Agreement”) pursuant to which
Sigma Opportunity Fund has been issued 1,286,667 shares of the Company’s Series
C Preferred Stock;
 
WHEREAS, in connection with the issuance of its Series C Preferred Stock, the
Company filed with the State of Delaware a Certificate of Designation of the
Powers, Preferences and Relative, Participating, Optional and Other Special
Rights of Preferred Stock and Qualifications, Limitations and Restrictions
Thereof of Series C Cumulative Convertible Preferred Stock of DecisionPoint
Systems, Inc. (the “Certificate of Designations”);
 
WHEREAS, the Company is entering into a Share Purchase Agreement (“SPA”) by and
between 231405 Ontario Inc. (“Purchaser”) and a wholly-owned subsidiary of the
Company, Karen Dalicandro (“Karen”), Donald Dalicandro (“Donald”) and 2293406
Ontario Inc., pursuant to which the Purchaser will acquire all  of the issued
and outstanding shares of Apex Systems Integrators Inc. (“Apex”);
 
WHEREAS, the Company, the Sigma Opportunity Fund and Sigma Advisors are parties
to the Investor Rights Agreement dated June 30, 2011 (the “Investor Rights
Agreement”);
 
WHEREAS the Company and Sigma Advisors are parties to an Advisory Services
Agreement, dated May 18, 2011 (the “Advisory Services Agreement”);
 
WHEREAS, pursuant to the Agreement between the Company, the Sigma Opportunity
Fund and Donald W. Rowley, dated June 30, 2011, Donald W. Rowley has been issued
128,667 shares of the Company’s Series C Preferred Stock (the “June 30, 2011
Agreement”);
 
NOW, THEREFORE, in exchange for good and valuable consideration the receipt of
which has been received, the Company, Sigma Opportunity Fund, Sigma Advisors and
Donald W. Rowley agree as follows:
 
1.  
Registration Rights. The Sigma Opportunity Fund and Sigma Advisors hereby agree
that notwithstanding anything to the contrary in the Investor Rights Agreement,
it will not exercise its demand registration rights provided in Section 2 of the
Investor Rights Agreement, dated June 30, 2011 between the Company, the Sigma
Opportunity Fund and the Sigma Advisors until the earlier of the date the number
of shares of the Company’s Common Stock issuable to the Vendors pursuant to the
2013 EBITDA Additional Earn-Out Amount (as defined in the SPA) have been
determined or June 30, 2013.

 
2.  
Payment of Fee.  The Company shall within one business day of the execution of
this Agreement pay the Sigma Advisors $400,000.  Sigma Advisors hereby agrees
that no further payments are due under the Advisory Services Agreement or any
other agreement with respect to the Company’s acquisition of the shares of Apex
or the receipt of any financing in connection with the acquisition of the shares
of Apex.

 

 
1

--------------------------------------------------------------------------------

 
 
3.  
Waiver and Consent.  Sigma Opportunity Fund hereby waives the  following
provisions of the Exchange Agreement and the Certificate of Designation to the
extent set forth below (any terms used in this section but not defined shall
have the meaning given to them in the SPA):

 
Section 4(s) of the Exchange Agreement as it relates to the grant of a security
interest to the Vendors, BDC Capital Inc., a wholly-owned subsidiary of the
Business Development Bank of Canada, and Royal Bank of Canada;
 
Section 4(h) of the Exchange Agreement as it relates to the increase in the
number of directors constituting the Board of Directors from eight to nine for a
period of up to 30 days, after which time the Company will use its best efforts
to seek the resignation or removal of one director (other than the director
appointed by Sigma Opportunity Fund)
 
Sections 4(l) and 4(m) of the Exchange Agreement as they related to the payment
of up to $7,333,400  in cash to the Vendors under the SPA and/or Convertible
Note; and
 
Section 4(p) of the Exchange Agreement as it relates to the conduct of the
business of Apex as it is currently conducted.
 
In connection with Section 4(f) of the Exchange Agreement and Section 4(c) of
the Certificate of Designations, Sigma Opportunity Fund consents to (i)the
annual interest rate of the Convertible Note issued by the Company to Purchaser
being up to 20%, (ii) the payment of up to $2,333,400 in cash to the Vendors
under the Convertible Note, and  (iii) the Bonus Amounts on Net Revenues that
may be due to the Vendors on Net Revenues over 2013, 2014 and 2015 up to the
maximum aggregate amount of $5,000,000 in cash.
 
In connection with Section 4(f) of the Exchange Agreement and Section 4 (c) of
the Certificate of Designations, Sigma Opportunity Fund consents to (i) the
interest rate relating to the loan agreement and loan documents by and between
Apex, BDC Capital Inc., a wholly-owned subsidiary of Business Development Bank
of Canada and the Company being up to 12.5% and (ii) the interest rate relating
to the credit agreement among the Company, Royal Bank of Canada, 2314505 Ontario
Inc. and Apex Systems Integrators being up to 4% per annum in excess of the
Royal Rank of Canada’s prime rate.
 
Notwithstanding anything herein to the contrary, in no event shall the aggregate
amount owing (inclusive of interest, fees and any other amounts owing) (i) to
BDC Capital or any successor or replacement lender at any time exceed
$1,700,000, (ii) to Royal Bank of Canada or any successor or replacement lender
at  any time exceed $2,750,000 or (iii) to all lenders to the Company and its
direct and indirect subsidiaries and affiliates (including Silicon Valley Bank
and any successor or replacement lender) at any time to exceed $11,800,000.  Any
potential increases over the above amounts owing shall not occur without the
prior consent of Sigma Opportunity Fund and under no circumstances shall there
be any required cash redemption for a breach of this covenant.
 
 
2

--------------------------------------------------------------------------------

 
 
In consideration of the forgoing waivers made by the Sigma Opportunity Fund in
this Section, effective as of the closing for the SPA, the Dividend Rate (as
defined in the Certificate of Designations) shall be 20% and the definition of
Breach Event included in the Certificate of Designations shall include any
default hereunder, under the loan documentation with any lender to the Company,
its subsidiaries or affiliates, and any breach or default under any agreement
relating to the acquisition of Apex, including, without limitation, the SPA and
Convertible Note.  The parties shall negotiate in good faith until August 15,
2012 relating to any other changes to the Certificate of Designations that the
parties may wish to agree upon in order to protect the interests of the holders
of the Series C Preferred Stock and the Company shall file such mutually
agreeable amended Certificate of Designations within two weeks thereafter.  If
the parties are unable to agree as to the form of revised Certificate of
Designations within such period, the Company shall amend the Certificate of
Designations within two weeks thereafter as set forth in the first sentence of
this paragraph and previously committed options to purchase common stock shall
be issued (not to exceed 100,000 shares) at the then fair market value (being
the closing price on the day prior to issuance) per share pursuant to the
Company’s equity compensation plan, thereby causing the Conversion Value (as
defined in the Certificate of Designations) of the Series C Preferred Stock to
be reset to such fair market value.   Notwithstanding anything to the contrary
in this Agreement, the Sigma Opportunity Fund shall still be entitled to any
adjustments contained in Section 5(h) of the Certificate of Designations  (if
any) that may arise as result of the stock issuances contemplated by the SPA
and/or the Convertible Note or otherwise.  The Company represents that the
amendment to the Certificate of Designations shall not require the consent of
any third party, including the holders of any other preferred stock of the
Company, and that the transactions contemplated by this Agreement do not
conflict with, and shall not cause any default under, the terms of any other
contract or agreement of the Company, including any certificates of designation
for preferred stock.
 
4.  
Issuance of Common Stock. In consideration of the agreement to delay exercise of
its demand registration right set forth in Section 1 of this Agreement, as soon
as possible after execution hereof, but in no event later than 15 days after
execution, the Company shall issue to (i) the Sigma Opportunity Fund 272,727
shares of its Common Stock, (ii) Sigma Advisors 25,000 shares of its Common
Stock, and (iii) Donald W. Rowley 27,273 shares of its Common Stock and the
issuance of the aforementioned shares shall be considered Exempt Issuances under
Section 5(h) of the Certificate of Designations. The company may amend the
Certificate of Designations to include the shares being issued pursuant this
Section in the definition of Exempt Issuances.

 
5.  
Amendment of the Certificate of Designations. Sigma Opportunity Fund and Donald
W. Rowley being the holders of 100% of the Company’s outstanding Series C
Preferred each consent to the amending of the Certificate of Designations as set
forth herein.

 
6.  
Interest Rate of AP Amount. The Company, Donald W. Rowley and Sigma Opportunity
Fund agree that upon the increase of the Dividend Rate of the Company’s Series C
Preferred, the interest rate on the balance of the AP Amount (as defined in the
June 30, 2011 Agreement) shall increase to 25% per annum.

 
7.  
Waiver.  The Sigma Opportunity Fund waives any non-compliance of the Exchange
Agreement that may have occurred with respect to (i) the payment of $349,986.34
in interest payments paid in 2011 with respect to the Accounts Payable
Obligation (as defined in the Exchange Agreement) and (ii) the payment of
$327,631.37 in interest payments paid during 2011 to David Rifkin.

 
8.  
Full Force and Effect.   Except as expressly and specifically set forth herein,
this Agreement shall not be deemed to be a waiver, amendment or modification of
any provisions of the Exchange Agreement, Certificate of Designations, the
Investor Rights Agreement or the Advisory Services Agreement or any right, power
or remedy of Sigma or constitute a waiver of any provision of these  Agreements
or Certificate of Designations (except to the extent expressly and specifically
herein set forth), or any other document, instrument and/or agreement executed
or delivered in connection therewith and any other agreement to which the
parties to this Agreement may be parties to, in each case whether arising before
or after the date hereof or as a result of performance hereunder or thereunder.

 
9.  
Counterparts.  This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to any other party, it being understood that all parties need not sign
the same counterpart.  In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were an original
thereof.

 
10.  
Governing Law.  This Agreement will be governed by and interpreted in accordance
with the laws of the State of New York without giving effect to the rules
governing the conflicts of law.

 
11.  
Amendments.  This Agreement and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought.

 
12.  
Severability.   The invalidity or unenforceability of any provision hereof will
in no way affect the validity or enforceability of any other provision.

 
13.  
Expenses.  The reasonable costs and reasonable expenses (including legal fees)
incurred by Sigma Opportunity Fund or Sigma Advisors in connection with this
Agreement and the transactions contemplated hereby shall be paid by the Company
promptly after demand therefor.

 
 
 
3

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, the Company and the undersigned have caused this Consent and
Waiver Agreement to be executed as of the date first written above.
 

  DECISIONPOINT SYSTEMS, INC.          
 
By:
/s/ Nicholas R. Toms       Nicholas R. Toms       Chief Executive Officer  

 

 
SIGMA OPPORTUNITY FUND II, LLC
         
 
By:
Sigma Capital Advisors, LLC      
Its managing member
            By: /s/ Thom Waye       Thom Waye       Manager  

 

 
SIGMA CAPITAL ADVISORS, LLC
            By: /s/ Thom Waye       Thom Waye       Manager               /s/
Donald W. Rowley       Donald W. Rowley          

 

 
 
4