exv10w29



 






Exhibit 10.29




THIRD AMENDMENT

TO

LOAN AGREEMENT





     This Third Amendment to Loan Agreement is entered into as of May 5, 2004
(the “Amendment”), by and among COMERICA BANK (“Bank”) and SAFEGUARD DELAWARE,
INC. (“Safeguard Delaware”) and SAFEGUARD SCIENTIFICS (DELAWARE), INC.
(“Safeguard Scientifics”; Safeguard Scientifics and Safeguard Delaware are
sometimes referred to, individually, as a “Borrower” and collectively, the
“Borrowers”).



RECITALS





     Borrowers and Bank are parties to that certain Loan Agreement dated as of
May 10, 2002, as amended, including without limitation by that certain First
Amendment to Loan Agreement dated as of May 9, 2003 and a Second Amendment to
Loan Agreement dated as of February 12, 2004 (as so amended, the “Agreement”).
The parties desire to further amend the Agreement in accordance with the terms
of this Amendment.



     NOW, THEREFORE, the parties agree as follows:




	 	1.	 	The following definition in Section 1.1 is amended to read as follows:
	 
	 	 	 	“Revolving Maturity Date” means May 7, 2005.
	 
	 	2.	 	Section 5.8 of the Agreement is amended to read as follows:





       5.8      Depository Balances. At all times during the term of
this Agreement, Borrowers, collectively, shall maintain in
unrestricted deposit accounts maintained by Bank, or in
certificates of deposit issued by Bank, a balance of cash and Cash
Equivalents that is at least equal to the outstanding balance of
the Credit Extensions. Borrowers shall maintain their principal
depository accounts with Bank. Each Borrower authorizes Bank to
decline to honor any checks, drafts or other items of payment or
directions to wire or otherwise transfer funds from Bank if and to
the extent that, after giving effect to the payment of any such
item or transfer of such funds, Borrowers would not be in
compliance with this Section.




	 	3.	 	Section 5.10 is added to the Agreement, as follows:





       5.10      Cash Balance Report. If the depository balances maintained pursuant
to Section 5.8 at any time are less than two times the outstanding balance of
the Credit Extensions, Borrower thereafter shall deliver to Bank within 10 days
of the last day of each month a cash balance report in form and substance
reasonably acceptable to Bank.




	 	4.	 	Section 6.4 of the Agreement is amended to read as follows:





       6.4      Impairment Charges. Impairment charges relating to
Private Partner Companies on a cumulative basis during the term of
this Agreement shall not exceed $50,000,000.




	 	5.	 	A new Section 13 is added to the Agreement to read as follows:





       13.     REFERENCE PROVISION.




       If and only if the jury trial waiver set forth in Section 11
of this Agreement is invalidated for any reason by a court of law,
statute or otherwise, the reference provisions set forth below
shall



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be substituted in place of the jury trial waiver. So long as
the jury trial waiver remains valid, the reference provisions set
forth in this Section shall be inapplicable.




       (a)      Each controversy, dispute or claim (each, a “Claim”)
between the parties arising out of or relating to this Agreement,
any security agreement executed by a Borrower in favor of Bank,
any note executed by a Borrower in favor of Bank or any other
document, instrument or agreement executed by a Borrower with or
in favor of Bank (collectively in this Section, the “Loan
Documents”), other than (i) all matters in connection with
nonjudicial foreclosure of security interests in real or personal
property; or (ii) the appointment of a receiver or the exercise of
other provisional remedies (any of which may be initiated pursuant
to applicable law) that are not settled in writing within fifteen
(15) days after the date on which a party subject to the Loan
Documents gives written notice to all other parties that a Claim
exists (the “Claim Date”) shall be resolved by a reference
proceeding in California in accordance with the provisions of
Section 638 et seq. of the California Code of Civil Procedure, or
their successor sections (“CCP”), which shall constitute the
exclusive remedy for the resolution of any Claim concerning the
Loan Documents, including whether such Claim is subject to the
reference proceeding. Except as set forth in this section, the
parties waive the right to initiate legal proceedings against each
other concerning each such Claim. Venue for these proceedings
shall be in the Superior Court in the County where the real
property, if any, is located or in a County where venue is
otherwise appropriate under state law (the “Court”). By mutual
agreement, the parties shall select a retired Judge of the Court
to serve as referee, and if they cannot so agree within fifteen
(15) days after the Claim Date, the Presiding Judge of the Court
(or his or her representative) shall promptly select the referee.
A request for appointment of a referee may be heard on an ex parte
or expedited basis. The referee shall be appointed to sit as a
temporary judge, with all the powers for a temporary judge, as
authorized by law, and upon selection should take and subscribe to
the oath of office as provided for in Rule 244 of the California
Rules of Court (or any subsequently enacted Rule). Each party
shall have one peremptory challenge pursuant to CCP §170.6. Upon
being selected, the referee shall (a) be requested to set the
matter for a status and trial-setting conference within fifteen
(15) days after the date of selection and (b) if practicable, try
any and all issues of law or fact and report a statement of
decision upon them within ninety (90) days of the date of
selection. The referee will have power to expand or limit the
amount of discovery a party may employ. Any decision rendered by
the referee will be final, binding and conclusive, and judgment
shall be entered pursuant to CCP §644 in any court in the State of
California having jurisdiction. The parties shall complete all
discovery no later than fifteen (15) days before the first trial
date established by the referee. The referee may extend such
period in the event of a party’s refusal to provide requested
discovery for any reason whatsoever, including, without
limitation, legal objections raised to such discovery or
unavailability of a witness due to absence or illness. No party
shall be entitled to “priority” in conducting discovery. Either
party may take depositions upon seven (7) days written notice, and
shall respond to requests for production or inspection of
documents within ten (10) days after service. All disputes
relating to discovery which cannot be resolved by the parties
shall be submitted to the referee whose decision shall be final
and binding upon the parties. Pending appointment of the referee
as provided herein, the Superior Court is empowered to issue
temporary and/or provisional remedies, as appropriate.




       (b)      Except as expressly set forth herein, the referee shall
determine the manner in which the reference proceeding is
conducted including the time and place of all hearings, the order
of presentation of evidence, and all other questions that arise
with respect to the course of the reference proceeding. Except
for trial, all proceedings and hearings conducted before the
referee shall be conducted without a court reporter unless a party
requests a court reporter. The party making such a request shall
have the obligation to arrange for and pay for the court reporter.
Subject to the referee’s power to award costs to the prevailing
party, the parties shall equally bear the costs of the court
reporter at the trial and the referee’s expenses



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       (c)      The referee shall determine all issues in accordance with
existing California case and statutory law. California rules of
evidence applicable to proceedings at law will apply to the
reference proceeding. The referee shall be empowered to enter
equitable as well as legal relief, to provide all temporary and/or
provisional remedies and to enter equitable orders that shall be
binding upon the parties. At the close of the reference
proceeding, the referee shall issue a single judgment at disposing
of all the claims of the parties that are the subject of the
reference. The parties reserve the right (i) to contest or appeal
from the final judgment or any appealable order or appealable
judgment entered by the referee and (ii) to obtain findings of
fact, conclusions of laws, a written statement of decision, and
(iii) to move for a new trial or a different judgment, which new
trial, if granted, shall be a reference proceeding under this
provision.




       (d)      If the enabling legislation which provides for appointment
of a referee is repealed (and no successor statute is enacted), any
dispute between the parties that would otherwise be determined by the
reference procedure herein described will be resolved and determined
by arbitration conducted by a retired judge of the Court, in
accordance with the California Arbitration Act §1280 through §1294.2
of the CCP as amended from time to time. The limitations with
respect to discovery as set forth in this Section shall apply to any
such arbitration proceeding.



     6. Unless otherwise defined, all initially capitalized terms in this
Amendment shall be as defined in the Agreement. The Agreement, as amended
hereby, shall be and remain in full force and effect in accordance with its
respective terms and hereby is ratified and confirmed in all respects. Each
Borrower ratifies and reaffirms the continuing effectiveness of the Agreement
and all instruments, documents and agreements entered into in connection with
the Agreement.



     7. Each Borrower represents and warrants that the Representations and
Warranties contained in the Agreement (other than those that relate to a
specific date, which representations and warranties are true and correct as of
such date) are true and correct as of the date of this Amendment, and that no
Event of Default has occurred and is continuing.



     8. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one instrument.



     9. As a condition to the effectiveness of this Amendment, Bank shall have
received, in form and substance satisfactory to Bank, the following:




	 	(a)	 	this Amendment, duly executed by Borrowers;
	 
	 	(b)	 	an amount equal to all Bank Expenses incurred through the date of this
Amendment; and
	 
	 	(c)	 	such other documents, and completion of such other matters, as Bank
may reasonably deem necessary or appropriate.




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     IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
first date above written.

	 	 	 	 	 
	 	SAFEGUARD DELAWARE, INC.

 	 
	 	By:  	CHRISTOPHER J. DAVIS
 	 
	 	 	 	 
	 	Title:  	Vice President 	 
	 


	 	 	 	 	 
	 	SAFEGUARD SCIENTIFICS

(DELAWARE), INC.

 	 
	 	By:  	CHRISTOPHER J. DAVIS
 	 
	 	 	 	 
	 	Title:  	Vice President 	 
	 


	 	 	 	 	 
	 	COMERICA BANK

 	 
	 	By:  	LAFE
VITTITOE	 
	 	 	 	 
	 	Title:  	Venture Banking Officer	 
	 





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