exv10w62






Exhibit 10.62




EXECUTION COPY





     WAIVER dated as of December 11, 2009 (this “Waiver”), to the CREDIT
AGREEMENT dated as of August 2, 2004 (as amended, supplemented or
otherwise modified through the date hereof, the “Credit Agreement”), among
ALION SCIENCE AND TECHNOLOGY CORPORATION (the “Borrower”), the Subsidiary
Guarantors listed on the signature pages hereto, the lenders from time to
time party to the Credit Agreement (the “Lenders”), and CREDIT SUISSE AG
(formerly known as Credit Suisse), as administrative agent (in such
capacity, the “Administrative Agent”) and as collateral agent for the
Lenders.



     A. Pursuant to the Credit Agreement, the Lenders have extended, and have agreed to extend,
credit to the Borrower.



     B. Pursuant to clause (b)(i) of the definition of the term “Consolidated EBITDA” set forth in
Section 1.01 of the Credit Agreement, in the calculation of Consolidated EBITDA for any period, the
Borrower is required to deduct without duplication therefrom all cash payments made during such
period on account of reserves, restructuring charges and other non-cash charges added to
Consolidated Net Income pursuant to clause (a)(v) of such definition in any previous period (the
“Cash Deductions”).



     C. The Borrower has informed the Administrative Agent that (i) the Borrower has in certain
prior periods failed to make Cash Deductions and, as a result of the Borrower’s failure to make
Cash Deductions in certain prior periods, one or more Defaults or Events of Default, including
those set forth on Schedule I hereto, exist and (ii) if the Borrower were to make the Cash
Deductions in respect of certain periods of four consecutive fiscal quarters ended on or prior to
September 30, 2009, the Borrower would have been in breach of certain covenants set forth in the
Credit Agreement, including those described on Schedule I hereto (the Defaults, Events of Default
and breaches described in this paragraph, and any breach of Section 5.05(a) of the Credit Agreement
occurring prior to the date hereof and related thereto, are referred to collectively as the
“Specified Defaults”).



     D. The Borrower has requested that the Required Lenders waive the Specified Defaults, and the
Required Lenders have agreed to such request on and subject to the terms and conditions of this
Waiver.



     Accordingly, in consideration of the mutual agreements herein contained and other good and
valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties
hereto agree as follows:



     SECTION 1. Defined Terms; Interpretation; Etc. Capitalized terms used and not defined herein
shall have the meanings assigned to such terms in the Credit Agreement. The rules of construction
set forth in Section 1.02 of the Credit Agreement shall apply equally to this Waiver. This Waiver
shall be a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.



     SECTION 2. Waiver. Subject to satisfaction of the conditions set forth below, the undersigned
Lenders hereby waive all Specified Defaults that (a) exist on the Waiver Effective Date (as defined
below) or (b) that will occur solely as a result of the proper application of the Cash Deductions
in the calculation of Consolidated EBITDA for the fiscal year and quarter ended September 30, 2009.
The foregoing is not construed to waive, expressly or by implication, any
future Default or Event of Default resulting directly or indirectly from the failure to make Cash



 









 






 2


Deductions after the date hereof or from the effect of Cash Deductions included in the
calculation of Consolidated EBITDA for any period ended after September 30, 2009.



     SECTION 3. Representations and Warranties. To induce the other parties hereto to enter into
this Waiver, the Borrower represents and warrants to the Administrative Agent and each of the
Lenders that:




     (a) This Waiver has been duly authorized, executed and delivered by each Loan Party, and
constitutes a legal, valid and binding obligation of such Loan Party in accordance with its
terms. The Credit Agreement (as modified hereby) constitutes a legal, valid and binding
obligation of the Borrower in accordance with its terms.




     (b) The representations and warranties set forth in Article III of the Credit Agreement
are true and correct in all material respects on and as of the Waiver Effective Date and after
taking into effect this Waiver with the same effect as though made on and as of the Waiver
Effective Date, except to the extent such representations and warranties expressly relate to
an earlier date (in which case such representations and warranties were true and correct in
all material respects as of such earlier date).




     (c) After taking into effect this Waiver, no Default or Event of Default has occurred
and is continuing.



     SECTION 4. Waiver Fees. (a) The Borrower agrees to pay to the Administrative Agent, for the
account of each Lender that executes and delivers a copy of this Waiver to the Administrative Agent
(or its counsel) at or prior to 12:00 (noon), New York City time, on December 11, 2009 (each, a
“Consenting Lender”), an initial waiver fee (collectively, the “Initial Waiver Fees”) in an amount
equal to 0.25% of the aggregate principal amount of the Term Loans and Revolving Credit Commitments
of such Lender outstanding on such date. The Initial Waiver Fees shall be payable in immediately
available funds in full on, and subject to the occurrence of, the Waiver Effective Date.




     (b) Should this Waiver Effective Date occur, the Borrower agrees to pay to the
Administrative Agent, for the account of each Consenting Lender, a supplemental waiver fee
(collectively, the “Supplemental Waiver Fees”) in an amount equal to 1.0% of the aggregate
principal amount of the Term Loans and Revolving Credit Commitments of such Consenting Lender
outstanding as of March 1, 2010. The Supplemental Waiver Fees shall be payable in immediately
available funds in full on March 1, 2010. If a Consenting Lender shall assign all or a
portion of its Term Loans or Revolving Credit Commitments after the Waiver Effective Date but
prior to March 1, 2010, then, unless the related Assignment and Acceptance shall otherwise
provide, the portion of the Supplemental Waiver Fees allocated to the portion of the Term
Loans or Revolving Credit Commitments so assigned shall be payable to such Consenting Lender’s
assignee.



     SECTION 5. Effectiveness. This Waiver shall become effective on the date (the “Waiver
Effective Date”) that the Administrative Agent shall have received (a) counterparts of this Waiver
that, when taken together, bear the signatures of the Borrower, each Subsidiary Guarantor and the
Required Lenders and (b) the Initial Waiver Fees and all expenses and other amounts payable to the
Administrative Agent that are required to be paid on or before the Waiver Effective Date in
accordance with any Loan Document, including the reimbursement or payment
of all reasonable out-of-pocket expenses (including reasonable fees, charges and disbursements
of counsel) required to be reimbursed or paid by any Loan Party under any Loan Document.



 









 





3


     SECTION 6. Effect of Waiver. Except as expressly set forth herein, this Waiver shall not by
implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and
remedies of the Lenders, the Administrative Agent, the Collateral Agent or the Borrower under the
Credit Agreement or any other Loan Document, and shall not alter, modify, amend or in any way
affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit
Agreement or any other Loan Document, all of which are ratified and affirmed in all respects and
shall continue in full force and effect. Nothing herein shall be deemed to entitle any Loan Party
to a consent to, or a waiver, amendment, modification or other change of, any of the terms,
conditions, obligations, covenants or agreements contained in the Credit Agreement or any other
Loan Document in similar or different circumstances. This Waiver shall apply and be effective only
with respect to the provisions of the Credit Agreement specifically referred to herein. After the
date hereof, any reference to the Credit Agreement shall mean the Credit Agreement, as modified
hereby.



     SECTION 7. Consent and Reaffirmation. Each Subsidiary Guarantor hereby consents to this
Waiver and the transactions contemplated hereby, and each Loan Party hereby (a) agrees that,
notwithstanding the effectiveness of this Waiver, the Guarantee and Collateral Agreement and each
of the other Security Documents continue to be in full force and effect, (b) confirms its guarantee
of the Obligations (with respect to each Subsidiary Guarantor) and its grant of a security interest
in its assets as Collateral therefor, all as provided in the Loan Documents as originally executed
and (c) acknowledges that such guarantee and/or grant continue in full force and effect in respect
of, and to secure, the Obligations under the Credit Agreement and the other Loan Documents.



     SECTION 8. Expenses. The Borrower agrees to reimburse the Administrative Agent for all
reasonable out-of-pocket expenses incurred in connection with this Waiver in accordance with the
Credit Agreement, including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent.



     SECTION 9. Counterparts. This Waiver may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall constitute but one and the
same contract. Delivery of an executed counterpart of a signature page of this Waiver by facsimile
or electronic transmission shall be as effective as delivery of a manually executed counterpart
hereof.



     SECTION 10. Applicable Law. THIS WAIVER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.



     SECTION 11. Headings. The headings of this Waiver are for purposes of reference only and
shall not limit or otherwise affect the meaning hereof.



[Remainder of this page intentionally left blank]





 









 








SIGNATURE PAGE TO THE WAIVER

TO THE ALION SCIENCE AND

TECHNOLOGY CORPORATION

CREDIT AGREEMENT DATED AS OF

AUGUST 2, 2004, AS AMENDED




     IN WITNESS WHEREOF, the parties hereto have caused this Waiver to be duly executed by their
respective authorized officers as of the day and year first above written.



	 	 	 	 	 
	 	ALION SCIENCE AND TECHNOLOGY CORPORATION,

 	 
	 	By  	

/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Senior VP and CFO 	 
	 



	 	 	 	 	 
	 	HUMAN FACTORS APPLICATIONS, INC.,

 	 
	 	By  	/s/ Joshua Izenberg
 	 
	 	 	Name:  	Joshua Izenberg 	 
	 	 	Title:  	Secretary 	 
	 



	 	 	 	 	 
	 	ALION-METI CORPORATION,

 	 
	 	By  	/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	ALION-CATI CORPORATION,

 	 
	 	By  	/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	ALION-JJMA CORPORATION,

 	 
	 	By  	/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	ALION-BMH CORPORATION,

 	 
	 	By  	/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 



 









 






	 	 	 	 	 



SIGNATURE PAGE TO THE WAIVER

TO THE ALION SCIENCE AND

TECHNOLOGY CORPORATION

CREDIT AGREEMENT DATED AS OF

AUGUST 2, 2004, AS AMENDED




	 	 	 	 	 
	 	WASHINGTON CONSULTING, INC.,

 	 
	 	By  	/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	ALION-MA&D CORPORATION,

 	 
	 	By  	

/s/ Michael Alber
 	 
	 	 	Name:  	Michael Alber 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	WASHINGTON CONSULTING GOVERNMENT

SERVICES, INC.,

 	 
	 	By  	/s/ Joshua Izenberg
 	 
	 	 	Name:  	Joshua Izenberg 	 
	 	 	Title:  	Secretary 	 



 









 






	 	 	 	 	 



SIGNATURE PAGE TO THE WAIVER

TO THE ALION SCIENCE AND

TECHNOLOGY CORPORATION

CREDIT AGREEMENT DATED AS OF

AUGUST 2, 2004, AS AMENDED



CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

(formerly known as Credit Suisse, Cayman

Islands Branch)

individually as a Lender and as
Administrative Agent,




	 	 	 	 	 
	 	 	 
	 	By  	

/s/ Doreen Barr
 	 
	 	 	Name:  	Doreen Barr 	 
	 	 	Title:  	Vice President 	 
	 
	 	 	 
	 	By  	

/s/ Christopher Day
 	 
	 	 	Name:  	Christopher Day 	 
	 	 	Title:  	Associate 	 



 









 






	 	 	 	 	 



SCHEDULE I





	1.	 	A default existed under Section 6.12 of the Credit Agreement with respect to the
twelve month periods ending December 31, 2007, March 31, 2008, June 30, 2008, September
30, 2008, December 31, 2008, March 31, 2009, June 30, 2009 and September 30, 2009 and
under Section 6.13 of the Credit Agreement with respect to the twelve month periods ending
June 30, 2006, September 30, 2006, December 31, 2006, December 31, 2007, March 31, 2008,
June 30, 2008, September 30, 2008, December 31, 2008, March 31, 2009 and June 30, 2009.
In all cases, these defaults constituted an Event of Default pursuant to Article VII,
paragraph (d) as of the end of each such period.
	 
	2.	 	A default existed under Section 5.04(c) with respect to compliance certificates and
supporting materials delivered to the Administrative Agent for the periods ending June 30,
2006, September 30, 2006, December 31, 2006, December 31, 2007, March 31, 2008, June 30,
2008, September 30, 2008, December 31, 2008, March 31, 2009, June 30, 2009 and September
30, 2009. These defaults each became an Event of Default pursuant to Article VII,
paragraph (a), as of the end of each such period.
	 
	3.	 	A default existed under Section 5.04(a) and (b) with respect to financial statements
delivered to the Administrative Agent for the periods ending June 30, 2006, September 30,
2006, December 31, 2006, December 31, 2007, March 31, 2008, June 30, 2008, September 30,
2008, December 31, 2008, March 31, 2009 and June 30, 2009. These defaults each became an
Event of Default pursuant to Article VII, paragraph (a) at the time the same were
furnished to the Administrative Agent.
	 
	4.	 	A default existed under Section 4.01(a) with respect to representations and
warranties deemed made by the Company at the time of a Borrowing in connection with each
Borrowing of Revolving Loans and /or Term Loans made by the Company on or after June 30,
2006, the date of the first failure by the Company to meet the requirements of Section
6.13. These defaults each became an Event of Default pursuant to Article VII, paragraph
(a) at the time of each such Borrowing.
	 
	5.	 	Each payment by the Company with respect to stock appreciation rights and phantom
stock on or after June 30, 2006, the date of the first failure by the Company to meet the
requirements of Section 6.13 (or a respective predecessor section of the Credit
Agreement), as noted above, constituted a prohibited Restricted Payment pursuant to the
terms of Section 6.06(a)(ii) of the Credit Agreement, and each such payment was an Event
of Default pursuant to Article VII, paragraph (d) as of the date of each such payment.
	 
	6.	 	Each payment by the Company made in connection with certain transactions relating to
the ESOP on or after June 30, 2006, the date of the first failure by the Company to meet
the requirements of Section 6.13 (or a respective predecessor section of the Credit
Agreement), as noted above, constituted a prohibited Restricted Payment pursuant to the
terms of Section 6.06(a)(iv) of the Credit Agreement, and each such payment was an Event
of Default pursuant to Article VII, paragraph (d) as of the date of each such payment.
	 
	7.	 	Each payment by the Company made of reasonable and customary fees made to non-officer
directors on or after June 30, 2006, the date of the first failure by the Company to meet
the requirements of Section 6.13 (or a respective predecessor section of the Credit
Agreement), as noted above, constituted a prohibited Affiliate transaction pursuant to the
terms of Section 6.07(e) of the Credit Agreement, and each such payment was an Event of
Default pursuant to Article VII, paragraph (d) as of the date of each such payment.
	 
	8.	 	The payment by the Company of $3,000,000 as a principal pre-payment of the
outstanding balance of the Seller Subordinated Notes on November 3, 2008 constituted a




 









 






	 	 	prohibited payment under Section 6.09(c) (in effect at the time thereof), and as such was
an Event of Default pursuant to Article VII, paragraph (d) as of the date of such payment.






	9.	 	Each payment by the Company in respect of Earn-Out Obligations on or after June 30,
2006, the date of the first failure by the Company to meet the requirements of Section
6.13 (or a respective predecessor section of the Credit Agreement), as noted above,
constituted a prohibited payment in respect of Earn-Out Obligations pursuant to the terms
of Section 6.16 of the Credit Agreement, and each such payment was an Event of Default
pursuant to Article VII, paragraph (d) as of the date of each such payment.