Unassociated Document


    
      


      THIRD
LOAN MODIFICATION AGREEMENT

      


      This Third Loan Modification Agreement
(this “Loan Modification Agreement”) is entered into as of
______________________, 2009, by and among (a) SILICON VALLEY BANK, a
California corporation, with its principal place of business at 3003 Tasman
Drive, Santa Clara, California 95054 and with a loan production office located
at One Newton Executive Park, Suite 200, 2221 Washington Street, Newton,
Massachusetts  02462 (“Bank”) and (b) PARADIGM HOLDINGS, INC., a
Wyoming corporation, with offices at 9715 Key West Avenue, Rockville,
Maryland  20850 (“Holdings”), PARADIGM SOLUTIONS
CORPORATION, a Maryland corporation, with offices at 9715 Key West
Avenue, Rockville, Maryland  20850 (“Solutions”), CALDWELL TECHNOLOGY SOLUTIONS
LLC, a Maryland limited liability company, with offices at 17001 Science
Drive, Suite 100, Bowie, Maryland 20715 (“Caldwell”) and TRINITY INFORMATION MANAGEMENT
SERVICES, a Nevada corporation, with offices at 9715 Key West Avenue,
Rockville, Maryland 20850 (“Trinity”) (hereinafter, Holdings, Solutions,
Caldwell and Trinity are jointly and severally, individually and collectively,
referred to as “Borrower”).

      


      1.           DESCRIPTION OF EXISTING
INDEBTEDNESS AND OBLIGATIONS. Among other indebtedness and obligations
which may be owing by Borrower to Bank, Borrower is indebted to Bank pursuant to
a loan arrangement dated as of March 13, 2007, evidenced by, among other
documents, a certain Loan and Security Agreement (working capital line of
credit) dated as of March 13, 2007, among Borrower and Bank, as amended by a
certain First Loan Modification Agreement dated as of August 11, 2008, and as
further amend by a certain Second Loan Modification Agreement dated as of March
18, 2009 (as amended, the “Loan Agreement”).  Capitalized terms used
but not otherwise defined herein shall have the same meaning as in the Loan
Agreement.

      


      2.           DESCRIPTION OF
COLLATERAL.  Repayment of the Obligations is secured by (a) the
Collateral as described in the Loan Agreement, (b) the Intellectual Property
Collateral as described in a certain Intellectual Property Security Agreement
dated as of March 13, 2007 between Bank and Holdings (the “Holdings IP Security
Agreement”), (c) the Intellectual Property Collateral as described in a certain
Intellectual Property Security Agreement dated as of March 13, 2007 between Bank
and Solutions (the “Solutions IP Security Agreement”), (d) the Intellectual
Property Collateral as described in a certain Intellectual Property Security
Agreement dated as of July 5, 2007 between Bank and Caldwell (the “Caldwell IP
Security Agreement”), and (e) the Intellectual Property Collateral as described
in a certain Intellectual Property Security Agreement dated as of September 5,
2007 between Bank and Trinity (the “Trinity IP Security Agreement”) (together
with any other collateral security granted to Bank, the  “Security
Documents”).  Hereinafter, the Security Documents, together with all
other documents evidencing or securing the Obligations shall be referred to as
the “Existing Loan Documents”.

      


      


      3.           DESCRIPTION OF CHANGE IN
TERMS.

      


      
        	
                 
      

              	
                A.

              	
                Modification
      to Loan Agreement.

              


      

      


      
        	
                 
      

              	
                1

              	
                The
      Loan Agreement shall be amended by deleting the following definition
      appearing in Section 13.1 thereof:

              


      

      


      


      “           “Maturity Date” is May 12,
2009.”

      


      and
inserting in lieu thereof the following:

      


      “           “Maturity Date” is June 12,
2009.”

      


      4.           FEES.  Borrower
shall pay to Bank a modification fee equal to Four Thousand Five Hundred Dollars
($4,500.00) which fee shall be due on the date hereof and shall be deemed fully
earned as of the date hereof.  Borrower shall also reimburse Bank for
all reasonable legal fees and expenses incurred in connection with this
amendment to the Existing Loan Documents.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      


      5.           RATIFICATION OF IP SECURITY
AGREEMENTS.

      


      (a)           Holdings
hereby ratifies, confirms and reaffirms, all and singular, the terms and
conditions of the Holdings IP Security Agreement and acknowledges, confirms and
agrees that the Holdings IP Security Agreement contains an accurate and complete
listing of all Intellectual Property Collateral as defined therein.

      


      (b)           Solutions
hereby ratifies, confirms and reaffirms, all and singular, the terms and
conditions of the Solutions IP Security Agreement and acknowledges, confirms and
agrees that the Solutions IP Security Agreement contains an accurate and
complete listing of all Intellectual Property Collateral as defined
therein.

      


      (c)           Caldwell
hereby ratifies, confirms and reaffirms, all and singular, the terms and
conditions of the Caldwell IP Security Agreement and acknowledges, confirms and
agrees that the Caldwell IP Security Agreement contains an accurate and complete
listing of all Intellectual Property Collateral as defined therein.

      


      (d)           Trinity
hereby ratifies, confirms and reaffirms, all and singular, the terms and
conditions of the Trinity IP Security Agreement and acknowledges, confirms and
agrees that the Trinity IP Security Agreement contains an accurate and complete
listing of all Intellectual Property Collateral as defined therein.

      


      6.           RATIFICATIONS OF PERFECTION
CERTIFICATES.

      


      (a)           Holdings
hereby ratifies, confirms and reaffirms, all and singular, the terms and
disclosures contained in a certain Perfection Certificate dated as of March 13,
2007 between Holdings and Bank, and acknowledges, confirms and agrees the
disclosures and information Holdings provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.

      


      (b)           Solutions
hereby ratifies, confirms and reaffirms, all and singular, the terms and
disclosures contained in a certain Perfection Certificate dated as of March 13,
2007 between Solutions and Bank, and acknowledges, confirms and agrees the
disclosures and information Solutions provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.

      


      (c)           Caldwell
hereby ratifies, confirms and reaffirms, all and singular, the terms and
disclosures contained in a certain Perfection Certificate dated as of July 5,
2007 between Caldwell and Bank, and acknowledges, confirms and agrees the
disclosures and information Caldwell provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.

      


      (d)           Trinity
hereby ratifies, confirms and reaffirms, all and singular, the terms and
disclosures contained in a certain Perfection Certificate dated as of September
5, 2007 between Trinity and Bank, and acknowledges, confirms and agrees the
disclosures and information Trinity provided to Bank in the Perfection
Certificate have not changed, as of the date hereof.

      


      
        
           

        

        
           

          
            

          

        

        
           

        

      

      


      7.           CONSISTENT
CHANGES.  The Existing Loan Documents are hereby amended
wherever necessary to reflect the changes described above.

      


      8.           RATIFICATION OF LOAN
DOCUMENTS.  Borrower hereby ratifies, confirms, and reaffirms
all terms and conditions of all security or other collateral granted to the
Bank, and confirms that the indebtedness secured thereby includes, without
limitation, the Obligations.

      


      9.           NO DEFENSES OF
BORROWER.  Borrower hereby acknowledges and agrees that
Borrower has no offsets, defenses, claims, or counterclaims against Bank with
respect to the Obligations, or otherwise, and that if Borrower now has, or ever
did have, any offsets, defenses, claims, or counterclaims against Bank, whether
known or unknown, at law or in equity, all of them are hereby expressly WAIVED
and Borrower hereby RELEASES Bank from any liability thereunder.

      


      10.           CONTINUING
VALIDITY.  Borrower understands and agrees that in modifying
the existing Obligations, Bank is relying upon Borrower’s representations,
warranties, and agreements, as set forth in the Existing Loan
Documents.  Except as expressly modified pursuant to this Loan
Modification Agreement, the terms of the Existing Loan Documents remain
unchanged and in full force and effect.  Bank’s agreement to
modifications to the existing Obligations pursuant to this  Loan
Modification Agreement in no way shall obligate Bank to make any future
modifications to the Obligations.  Nothing in this Loan Modification
Agreement shall constitute a satisfaction of the Obligations.  It is
the intention of Bank and Borrower to retain as liable parties all makers of
Existing Loan Documents, unless the party is expressly released by Bank in
writing.  No maker will be released by virtue of this Loan
Modification Agreement.

      


      11.           COUNTERSIGNATURE.  This
Loan Modification Agreement shall become effective only when it shall have been
executed by Borrower and Bank.

      


      


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      This Loan Modification Agreement is
executed as of the date first written above.

      
         

        
          
            
              
                
                  	
                          BORROWER:

                           

                          PARADIGM
      HOLDINGS,
      INC.         

                        	 	 	
                          BANK:

                           

                          SILICON VALLEY BANK

                        	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By:	
                          /s/
      Richard Sawchak     

                        	 	By:	
                          /s/
      

                        	 
	 	 	 	 	 
	Name:  Richard
      Sawchak     	 	Name: 
      	
                           

                        	 
	 	
                           

                        	 	 	
                           

                        	 
	Title:   
      SVP and CFO  	 	Title:	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	PARADIGM
      SOLUTIONS CORPORATION	 	 	 	 
	 	 	 	 	 	 
	By:	      
                          /s/
      Richard Sawchak     

                        	 	 	 	 
	 	 	 	 	 	 
	Name:  	Richard
      Sawchak	 	 	 	 
	 	 	 	 	 	 
	Title: 	SVP
      and CFO	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	CALDWELL
      TECHNOLOGY SOLUTIONS LLC	 	 	 	 
	 	 	 	 	 	 
	By: 	      
                          /s/
      Richard Sawchak     

                        	 	 	 	 
	 	 	 	 	 	 
	Name:  	Richard
      Sawchak	 	 	 	 
	 	 	 	 	 	 
	Title: 	SVP
      and CFO	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	TRINITY
      INFORMATION MANAGEMENT SERVICES	 	 	 	 
	 	 	 	 	 	 
	By: 	      
                          /s/
      Richard Sawchak     

                        	 	 	 	 
	 	 	 	 	 	 
	Name:  	Richard
      Sawchak	 	 	 	 
	 	 	 	 	 	 
	Title: 	SVP
      and CFO