Document:

REGISTRATION RIGHTS AGREEMENT

 Exhibit 10.2 
  
 REGISTRATION RIGHTS AGREEMENT 
  
 This Registration Rights Agreement (this “Agreement”) is made and entered into as of February 26, 2004, by
and among Saflink Corporation, a Delaware corporation (the “Company”), and the purchasers listed on Schedule I hereto (the “Purchasers”). 
  
 This Agreement is being entered into pursuant to the Common Stock Purchase Agreement dated as of the date hereof among the
Company and the Purchasers (the “Purchase Agreement”). 
  
 The Company and the Purchasers hereby agree as follows: 
  
 1. Definitions. 
  
 Capitalized terms used and not otherwise defined herein shall have the meanings given such terms in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings: 
  
 “Affiliate” means, with respect to any Person, any other
Person that directly or indirectly controls or is controlled by or under common control with such Person. For the purposes of this definition, “control,” when used with respect to any Person, means the possession, direct or
indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise; and the terms of “affiliated,”
“controlling” and “controlled” have meanings correlative to the foregoing. 
  
 “Board” shall have meaning set forth in Section 3(n). 
  
 “Business Day” means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on
which banking institutions in the state of New York generally are authorized or required by law or other government actions to close. 
  
 “Closing Date” means the date of the closing of the purchase and sale of the Shares pursuant to the Purchase Agreement. 
  
 “Commission” means the Securities and Exchange Commission.

  
 “Common Stock” means the Company’s
Common Stock, par value $0.01 per share. 
  
 “Effectiveness Date” means with respect to the Registration Statement the earlier of the 90th day following the Closing Date or the date which is within five (5) Business Days of the date on which the Commission informs the Company (i) that the Commission will not review the Registration Statement or (ii) that the Company may
request the acceleration of the effectiveness of the Registration Statement and the Company makes such request. 
  
 “Effectiveness Period” shall have the meaning set forth in Section 2. 

 “Event” shall have the meaning set forth in Section 7(e). 
  
 “Event Date” shall have the meaning set forth in Section
7(e). 
  
 “Exchange Act” means the Securities
Exchange Act of 1934, as amended. 
  
 “Filing
Date” means the 45th day following the Closing Date. 
  
 “Holder” or “Holders” means the holder or
holders, as the case may be, from time to time of Registrable Securities. 
  
 “Indemnified Party” shall have the meaning set forth in Section 5(c). 
  
 “Indemnifying Party” shall have the meaning set forth in Section 5(c). 
  
 “Losses” shall have the meaning set forth in Section 5(a). 
  
 “Person” means an individual or a corporation, partnership,
trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind. 
  
 “Proceeding” means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition), whether commenced or threatened. 
  
 “Prospectus” means the prospectus included in the Registration Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the
terms of the offering of any portion of the Registrable Securities covered by the Registration Statement, and all other amendments and supplements to the Prospectus, including post-effective amendments, and all material incorporated by reference in
such Prospectus. 
  
 “Registrable Securities”
means (i) the shares of Common Stock issued to the Purchasers pursuant to the Purchase Agreement and (ii) the shares of Common Stock issuable upon exercise of the Warrants. 
  
 “Registration Statement” means the registration statements and any additional registration statements
contemplated by Section 2, including (in each case) the Prospectus, amendments and supplements to such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by
reference in such registration statement. 
  

 -2- 

 “Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule. 
  
 “Rule 158” means Rule 158 promulgated by the Commission pursuant to the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule. 
  
 “Rule 415” means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule. 
  
 “Securities Act” means the Securities Act of 1933, as amended. 
  
 “Special Counsel” means one special counsel to the Holders, for which the Holders will be reimbursed by the
Company pursuant to Section 4. 
  
 2. Resale Registration.

  
 On or prior to the Filing Date the Company shall prepare and
file with the Commission a Registration Statement covering the resale of the Registrable Securities as would permit or facilitate the sale and distribution of all the Registrable Securities in the manner reasonably requested by the Holders. The
Registration Statement shall be on Form S-3 (except if the Company is not then eligible to register for resale the Registrable Securities on Form S-3, in which case such registration shall be on another appropriate form in accordance with the
Securities Act and the rules promulgated thereunder). The Company shall (i) not permit any securities other than the Registrable Securities to be included in the Registration Statement and (ii) use its reasonable best efforts to cause the
Registration Statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, but in any event prior to the Effectiveness Date, and to keep such Registration Statement continuously effective under the
Securities Act until such date as is the earlier of (x) the date when all Registrable Securities covered by such Registration Statement have been sold; (y) the date on which the Registrable Securities may be sold without any restriction pursuant to
Rule 144 as determined by the counsel to the Company pursuant to a written opinion letter, addressed to the Company’s transfer agent to such effect, or (z) the third (3rd) anniversary of the Closing Date (the “Effectiveness Period”). 
  
 3. Registration Procedures. 
  

In connection with the Company’s registration obligations hereunder, the Company shall: 
  
 (a) Prepare and file with the Commission on or prior to the Filing Date, a
Registration Statement on Form S-3 (or if the Company is not then eligible to register for resale the Registrable Securities on Form S-3 such registration shall be on another appropriate form in accordance with the Securities Act and the rules and
regulations promulgated thereunder) in accordance with the method or methods of distribution thereof as specified by the Holders (except if otherwise directed by the Holders), and use its reasonable best efforts to cause the Registration Statement
to become effective and remain effective as provided herein. 
  

 -3- 

 (b) Prepare and file with the Commission such amendments, including post-effective amendments, to the
Registration Statement as may be necessary to keep the Registration Statement continuously effective as to the applicable Registrable Securities for the Effectiveness Period and prepare and file with the Commission such additional Registration
Statements, if necessary, in order to register for resale under the Securities Act all of the Registrable Securities; (ii) cause the related Prospectus to be amended or supplemented by any required Prospectus supplement, and as so supplemented or
amended to be filed pursuant to Rule 424 (or any similar provisions then in force) promulgated under the Securities Act; (iii) respond as promptly as possible, but in no event later than fifteen (15) business days, to any comments received from the
Commission with respect to the Registration Statement or any amendment thereto and as promptly as possible provide the Holders true and complete copies of all correspondence from and to the Commission relating to the Registration Statement; and (iv)
comply in all material respects with the provisions of the Securities Act and the Exchange Act with respect to the disposition of all Registrable Securities covered by the Registration Statement during the applicable period in accordance with the
intended methods of disposition by the Holders thereof set forth in the Registration Statement as so amended or in such Prospectus as so supplemented. 
  
 (c) Notify the Holders of Registrable Securities to be sold as promptly as possible (and, in the case of (i)(A) below, not less than three (3) days prior
to such filing) and (if requested by any such Person) confirm such notice in writing no later than one (1) Business Day following the day (i)(A) when a Prospectus or any Prospectus supplement or post-effective amendment to the Registration Statement
is filed; (B) when the Commission notifies the Company whether there will be a “review” of such Registration Statement and whenever the Commission comments in writing on such Registration Statement and (C) with respect to the Registration
Statement or any post-effective amendment, when the same has become effective; (ii) of any request by the Commission or any other Federal or state governmental authority for amendments or supplements to the Registration Statement or Prospectus or
for additional information; (iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose;
(iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any
Proceeding for such purpose; and (v) of the occurrence of any event that makes any statement made in the Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material
respect or that requires any revisions to the Registration Statement, Prospectus or other documents so that, in the case of the Registration Statement or the Prospectus, as the case may be, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 
  

 -4- 

 (d) Use its reasonable best efforts to avoid the issuance of, or, if issued, obtain the withdrawal of,
(i) any order suspending the effectiveness of the Registration Statement or (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any U.S. jurisdiction, at the earliest
practicable moment. 
  
 (e) If requested by the Holders of a
majority of the Registrable Securities, (i) promptly incorporate in a Prospectus supplement or post-effective amendment to the Registration Statement such information as the Company reasonably agrees should be included therein and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment as soon as practicable after the Company has received notification of the matters to be incorporated in such Prospectus supplement or post-effective amendment.

  
 (f) Furnish to each Holder, without charge, at least one
conformed copy of each Registration Statement and each amendment thereto, including financial statements and schedules, and, to the extent requested by such Person, all documents incorporated or deemed to be incorporated therein by reference, and
all exhibits (including those previously furnished or incorporated by reference) promptly after the filing of such documents with the Commission. 
  
 (g) Promptly deliver to each Holder, without charge, as many copies of the Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such Persons may reasonably request; and the Company hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of the selling Holders in connection with the offering and sale of
the Registrable Securities covered by such Prospectus and any amendment or supplement thereto. 
  
 (h) Prior to any public offering of Registrable Securities, use its reasonable best efforts to register or qualify or cooperate with the selling Holders in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United States as any Holder requests in writing, to keep each such
registration or qualification (or exemption therefrom) effective during the Effectiveness Period and to do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered
by a Registration Statement; provided, however, the Company shall in no event be required to (x) qualify to do business in any state where it is not then qualified or (y) take any action that would subject it to tax or to the general
service of process in any such state where it is not then subject, or (z) comply with state securities or “blue sky” laws of any state for which registration by coordination is unavailable to the Company. 
  
 (i) Cooperate with the Holders to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold pursuant to a Registration Statement, which certificates shall be free of all restrictive legends (provided that the issuance of such unlegended certificates is in compliance
with applicable securities laws), and to enable such Registrable Securities to be in such denominations and registered in such names as any Holder may request at least two (2) Business Days prior to any sale of Registrable Securities. 
  

 -5- 

 (j) Upon the occurrence of any event contemplated by Section 3(c)(vi), promptly prepare a supplement or
amendment, including a post-effective amendment, to the Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, and file any other required document so that, as
thereafter delivered, neither the Registration Statement nor such Prospectus will contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading. 
  
 (k) Use its reasonable best efforts to cause all Registrable Securities relating to the Registration Statement to be listed on The Nasdaq SmallCap Market, OTC Bulletin Board or any other securities exchange, quotation system or market, if
any, on which similar securities issued by the Company are then listed or traded as and when required pursuant to the Purchase Agreement. 
  
 (l) Comply in all material respects with all applicable rules and regulations of the Commission and make generally available to its security holders
earning statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 not later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) commencing
on the first day of the first fiscal quarter of the Company after the effective date of the Registration Statement, which statement shall conform to the requirements of Rule 158. 
  
 (m) The Company may require each selling Holder to furnish to the Company information regarding such Holder and the
distribution of such Registrable Securities as is required by law to be disclosed in the Registration Statement, and the Company may exclude from such registration the Registrable Securities of any such Holder who fails to furnish such information
within a reasonable time after receiving such request. 
  
 If the
Registration Statement refers to any Holder by name or otherwise as the holder of any securities of the Company, then such Holder shall have the right to require (if such reference to such Holder by name or otherwise is not required by the
Securities Act or any similar federal statute then in force) the deletion of the reference to such Holder in any amendment or supplement to the Registration Statement filed or prepared subsequent to the time that such reference ceases to be
required. 
  
 Each Holder covenants and agrees that (i) it will
not sell any Registrable Securities under the Registration Statement until it has received copies of the Prospectus as then amended or supplemented as contemplated in Section 3(g) and notice from the Company that such Registration Statement and any
post-effective amendments thereto have become effective as contemplated by Section 3(c) and (ii) it and its officers, directors or Affiliates, if any, will comply with the prospectus delivery requirements of the Securities Act as applicable to them
in connection with sales of Registrable Securities pursuant to the Registration Statement. 
  
 Each Holder agrees by its acquisition of such Registrable Securities that, upon receipt of a notice from the Company of the occurrence of any event of the kind described in 

  

 -6- 

 
Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v), 3(c)(vi) or 3(n), such Holder will forthwith discontinue disposition of such Registrable Securities under the
Registration Statement until such Holder’s receipt of the copies of the supplemented Prospectus and/or amended Registration Statement contemplated by Section 3(j), or until it is advised in writing by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such Prospectus or Registration Statement. 
  
 (n) If (i) there is material non-public information regarding the Company
which the Company’s Board of Directors (the “Board”) reasonably determines not to be in the Company’s best interest to disclose and which the Company is not otherwise required to disclose, or (ii) there is a significant
business opportunity (including, but not limited to, the acquisition or disposition of assets (other than in the ordinary course of business) or any merger, consolidation, tender offer or other similar transaction) available to the Company which the
Board reasonably determines not to be in the Company’s best interest to disclose, then the Company may postpone or suspend filing or effectiveness of a registration statement for a period not to exceed thirty (30) consecutive days, provided
that the Company may not postpone or suspend its obligation under this Section 3(n) for more than forty-five (45) days in the aggregate during any 12 month period; provided, however, that no such postponement or suspension shall be
permitted for consecutive thirty (30) day periods, arising out of the same set of facts, circumstances or transactions. 
  
 4. Registration Expenses. 
  
 All fees and expenses incident to the performance of or compliance with this Agreement by the Company (excluding underwriters’ discounts and
commissions), except as and to the extent specified in this Section 4, shall be borne by the Company whether or not the Registration Statement is filed or becomes effective and whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses (A) with respect to filings required to be
made with The Nasdaq SmallCap Market and each other securities exchange or market on which Registrable Securities are required hereunder to be listed, (B) with respect to filings required to be made with the National Association of Securities
Dealers, Inc. and the NASD Regulation, Inc. and (C) in compliance with state securities or Blue Sky laws, (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities and of printing
prospectuses if the printing of prospectuses is requested by the holders of a majority of the Registrable Securities included in the Registration Statement), (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel
for the Company and Special Counsel for the Holders, in the case of the Special Counsel, up to a maximum amount of $5,000, (v) Securities Act liability insurance, if the Company so desires such insurance, and (vi) fees and expenses of all other
Persons retained by the Company in connection with the consummation of the transactions contemplated by this Agreement, including, without limitation, the Company’s independent public accountants (including the expenses of any comfort letters
or costs associated with the delivery by independent public accountants of a comfort letter or comfort letters). In addition, the Company shall be responsible for all of its internal expenses incurred in connection with the consummation of the
transactions contemplated by this Agreement (including, without 

  

 -7- 

 
limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit, the fees and
expenses incurred in connection with the listing of the Registrable Securities on any securities exchange as required hereunder. 
  
 5. Indemnification. 
  
 (a) Indemnification by the Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold harmless the
Purchaser, its permitted assignees, officers, directors, agents, brokers (including brokers who offer and sell Registrable Securities as principal as a result of a pledge or any failure to perform under a margin call of Common Stock), investment
advisors and employees, each Person who controls any such Purchaser or permitted assignee (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, agents and employees of each such
controlling Person, and the respective successors, assigns, estate and personal representatives of each of the foregoing, to the fullest extent permitted by applicable law, from and against any and all claims, losses, damages, liabilities,
penalties, judgments, costs (including, without limitation, costs of investigation) and expenses (including, without limitation, reasonable attorneys’ fees and expenses) (collectively, “Losses”), arising out of or relating to
any untrue or alleged untrue statement of a material fact contained in the Registration Statement, any Prospectus, as supplemented or amended, if applicable, or arising out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in the case of any Prospectus or form of prospectus or supplement thereto, in the light of the circumstances under which they were made) not misleading, except (i) to the
extent, but only to the extent, that such untrue statements or omissions are based upon information regarding the Holder furnished in writing to the Company by the Holder expressly for use in the Registration Statement, such Prospectus or such form
of Prospectus or in any amendment or supplement thereto, which information was reasonably relied on by the Company for use therein or to the extent that such information relates to such Holder or such Holder’s proposed method of distribution of
Registrable Securities and was reviewed and expressly approved in writing by such Holder or (ii) as a result of the failure of the Holder to deliver a Prospectus, as amended or supplemented, to a purchaser in connection with an offer or sale. The
Company shall notify the Holder promptly of the institution, threat or assertion of any Proceeding of which the Company is aware in connection with the transactions contemplated by this Agreement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of an Indemnified Party (as defined in Section 6(c) hereof) and shall survive the transfer of the Registrable Securities by the Holder. 
  
 (b) Indemnification by Purchasers. Each Purchaser and its permitted
assignees shall, severally and not jointly, indemnify and hold harmless the Company, its directors, officers, agents and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act), and the directors, officers, agents or employees of such controlling Persons, and the respective successors, assigns, estate and personal representatives of each of the foregoing, to the fullest extent permitted by applicable law,
from and against all Losses, as incurred, arising out of or relating to any untrue or alleged untrue statement of a material fact contained in the Registration Statement, any Prospectus, as supplemented or amended, if applicable, or arising out of
or 

  

 -8- 

 
relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any
Prospectus or supplement thereto, in the light of the circumstances under which they were made) not misleading, to the extent, but only to the extent, that such untrue statement or omission is contained in or omitted from any information so
furnished in writing by the Holder to the Company specifically for inclusion in the Registration Statement or such Prospectus and that such information was reasonably relied upon by the Company for use in the Registration Statement, such Prospectus
or to the extent that such information relates to the Holder or the Holder’s proposed method of distribution of Registrable Securities and was furnished in writing by the Holder expressly for use in the Registration Statement, such Prospectus
or such Prospectus Supplement. Notwithstanding anything to the contrary contained herein, the Purchasers shall be liable under this Section 5(b) for only that amount as does not exceed the net proceeds to such Purchaser as a result of the sale of
Registrable Securities pursuant to such Registration Statement. 
  
 (c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified Party promptly shall notify the
Person from whom indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall assume the defense thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the
payment of all fees and expenses incurred in connection with defense thereof; provided, that the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying Party of its obligations or liabilities pursuant to this
Agreement, except (and only) to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have proximately and materially adversely
prejudiced the Indemnifying Party. 
  
 An Indemnified Party shall
have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has
agreed in writing to pay such fees and expenses; or (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding; or (3)
the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and such Indemnified Party shall have been advised by counsel (which shall be reasonably acceptable to the
Indemnifying Party) that a conflict of interest is likely to exist if the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which case, the Indemnifying Party shall be responsible for reasonable fees and expenses
of no more than one counsel for Indemnified Parties. The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably withheld or delayed. No
Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of
such Indemnified Party from all liability on claims that are the subject matter of such Proceeding. 
  

 -9- 

 All fees and expenses of the Indemnified Party (including reasonable fees and expenses to the extent
incurred in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall be paid to the Indemnified Party, as incurred, within ten (10) Business Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an Indemnified Party is not entitled to indemnification hereunder; provided, that the Indemnifying Party may require such Indemnified Party to undertake to reimburse all such
fees and expenses to the extent it is finally judicially determined that such Indemnified Party is not entitled to indemnification hereunder). 
  
 (d) Contribution. If a claim for indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party because of a failure or refusal
of a governmental authority to enforce such indemnification in accordance with its terms (by reason of public policy or otherwise), then each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions, statements or omissions that resulted in
such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such Indemnifying, Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such action, statement or omission. The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in Section
5(c), any reasonable attorneys’ or other reasonable fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms. 
  
 The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by pro rata allocation or by any other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation. 
  
 The indemnity and
contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties. Notwithstanding anything to the contrary contained herein, the Holders shall be liable under this
Section 5(d) for only that amount as does not exceed the net proceeds to such Holder as a result of the sale of Registrable Securities pursuant to such Registration Statement. 
  
 6. Rule 144. 
  
 As long as any Holder owns any Registrable Securities, the Company covenants to timely file (or obtain extensions in respect thereof and file within the
applicable grace period) all 
  

 -10- 

 
reports required to be filed by the Company after the date hereof pursuant to Section 13(a) or 15(d) of the Exchange Act and to promptly furnish the Holders
with true and complete copies of all such filings. As long as any Holder owns any Registrable Securities, if the Company is not required to file reports pursuant to Section 13(a) or 15(d) of the Exchange Act, it will prepare and furnish to the
Holders and make publicly available in accordance with Rule 144(c) promulgated under the Securities Act annual and quarterly financial statements, together with a discussion and analysis of such financial statements in form and substance
substantially similar to those that would otherwise be required to be included in reports required by Section 13(a) or 15(d) of the Exchange Act, as well as any other information required thereby, in the time period that such filings would have been
required to have been made under the Exchange Act. The Company further covenants that it will take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Person to sell the Shares
without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act, including providing any legal opinions relating to such sale pursuant to Rule 144. Upon the request of
any Holder, the Company shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements. 
  

7. Miscellaneous. 
  
 (a) Remedies. In the event of a breach by the Company or by a Holder, of any of their obligations under this Agreement, each Holder or the Company,
as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. The Company and each Holder
agree that monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any of the provisions of this Agreement and hereby further agrees that, in the event of any action for specific performance in
respect of such breach, it shall waive the defense that a remedy at law would be adequate. 
  
 (b) No Inconsistent Agreements. Neither the Company nor any of its subsidiaries has, as of the date hereof entered into and currently in effect, nor shall the Company or any of its subsidiaries, on or after the
date of this Agreement, enter into any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. The Company nor any of its subsidiaries
has previously granted any registration rights that conflict with the registration rights granted under this Agreement. Without limiting the generality of the foregoing, without the written consent of the Holders of a majority of the then
outstanding Registrable Securities, the Company shall not grant to any Person the right to request the Company to register any securities of the Company, under the Securities Act unless the rights so granted are subject in all respects to the prior
rights in full of the Holders set forth herein, and are not otherwise in conflict with the provisions of this Agreement. 
  
 (c) No Piggyback on Registrations. Neither the Company nor any of its security holders (other than the Holders in such capacity pursuant hereto or
as disclosed on Schedule 2.1(c) of the Purchase Agreement or Schedule II hereto) may include securities of the 

  

 -11- 

 
Company in the Registration Statement, and the Company shall not after the date hereof enter into any agreement providing such right to any of its
securityholders, unless the right so granted is subject in all respects to the prior rights in full of the Holders set forth herein, and is not otherwise in conflict with the provisions of this Agreement. 
  
 (d) Intentionally Omitted. 
  
 (e) Failure to File Registration Statement and Other Events. The
Company and the Purchasers agree that the Holders will suffer damages if the Registration Statement is not filed on or prior to the Filing Date and not declared effective by the Commission on or prior to the Effectiveness Date and maintained in the
manner contemplated herein during the Effectiveness Period or if certain other events occur. The Company and the Holders further agree that it would not be feasible to ascertain the extent of such damages with precision. Accordingly, if (A) the
Registration Statement is not filed on or prior to the Filing Date, or (B) the Registration Statement is not declared effective by the Commission on or prior to the 120th day after the Closing Date, or (C) the Company fails to file with the Commission a request for acceleration in accordance with Rule 461 promulgated under the
Securities Act within five (5) Business Days of the date that the Company is notified (orally or in writing, whichever is earlier) by the Commission that a Registration Statement will not be “reviewed” (including, without limitation, any
form of “modified” or “limited” review), or not subject to further review, or (D) the Registration Statement is filed with and declared effective by the Commission but thereafter ceases to be effective as to all Registrable
Securities at any time prior to the expiration of the Effectiveness Period, without being promptly succeeded by a subsequent Registration Statement filed with and declared effective by the Commission, or (E) during the Effectiveness Period, the
Company has breached Section 3(n), or (F) during the Effectiveness Period, trading in the Common Stock shall be suspended or if the Common Stock is delisted from both The Nasdaq SmallCap Market and the OTC Bulletin Board for any reason for more than
five Business Days in the aggregate (any such failure or breach being referred to as an “Event,” and for purposes of clauses (A) and (B) the date on which such Event occurs, or for purposes of clause (C) the date on which such five
Business Day period is exceeded, or for purposes of clause (D) after more than fifteen Business Days, or for purposes of clause (F) the date on which such five Business Day period is exceeded, being referred to as “Event Date”), the
Company shall pay an amount as liquidated damages to each Holder equal to 2% for the first thirty (30) day period and 1% per thirty (30) day period thereafter or portion thereof of the Holder’s initial investment in the Shares from the Event
Date (provided that, with respect to the Event described in clause (B), the “first calendar month” shall be deemed to commence on the 30th day prior to the applicable Event Date) until the applicable Event is cured; provided, that, liquidated damages for the first calendar month upon the occurrence of an Event, and for each
calendar month thereafter shall be payable in cash only; provided, further, that the Company shall not incur liquidated damages under this Section 7(e) if such Event occurs after the expiration of the Effectiveness Period.
Notwithstanding anything to the contrary in this paragraph (e), if (I) any of the Events described in clauses (A), (B), (C), (D) or (F) shall have occurred, (II) on or prior to the applicable Event Date, the Company shall have exercised its rights
under Section 3(n) hereof and (III) the postponement or suspension permitted pursuant to such Section 3(n) shall remain effective as of such applicable Event Date, then the applicable Event Date shall be deemed instead to occur on the second
Business Day following the termination of such postponement or suspension. 

  

 -12- 

 
Payments to be made pursuant to this Section 7(e) shall be due and payable immediately upon demand at the option of the Holders in cash. The parties agree
that the liquidated damages represent a reasonable estimate on the part of the parties, as of the date of this Agreement, of the amount of damages that may be incurred by the Holders if the Registration Statement is not filed on or prior to the
Filing Date or has not been declared effective by the Commission on or prior to the Effectiveness Date and maintained in the manner contemplated herein during the Effectiveness Period or if any other Event as described herein has occurred.
Notwithstanding the foregoing, the Company shall not be obligated to pay liquidated damages for a delay or suspension of effectiveness as a result of the Blackout Period. 
  
 (f) Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be
amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by the Company and the Holders of a majority of the Registrable Securities
outstanding. Any amendment or waiver effected in accordance with this Section 8(f) shall be binding upon each Holder (and their permitted assigns) and the Company. 
  
 (g) Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder
shall be in writing and shall be deemed given and effective on the earlier of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice prior to 5:00 p.m., New
York City time, on a Business Day, (ii) the Business Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice later than 5:00 p.m., New York City time, on
any date and earlier than 11:59 p.m., New York City time, on such date, (iii) the Business Day following the date of mailing, if sent by nationally recognized overnight courier service or (iv) actual receipt by the party to whom such notice is
required to be given. The addresses for such communications shall be with respect to each Holder at its address set forth under its name on Schedule I attached hereto, or with respect to the Company, addressed to: 
  
 Saflink Corporation 
 777 108th Avenue NE, Suite 2100 
 Bellevue, WA 98004 
 Attention: President 
 Tel. No.: (425) 278-1100 
 Fax No.: (425)
      -         
  
 or to such other address or addresses or facsimile number or numbers as any such party may most recently have designated in writing to the other parties hereto by such notice. 
  
 (h) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted assigns and shall inure to the benefit of each Holder and its successors and assigns. The Company may not assign this Agreement or any of its rights or obligations hereunder
without the prior written consent of each Holder. Each Purchaser may assign its rights hereunder in the manner and to the Persons as permitted under the Purchase Agreement. 
  

 -13- 

 (i) Assignment of Registration Rights. The rights of each Holder hereunder, including the right to
have the Company register for resale Registrable Securities in accordance with the terms of this Agreement, shall be assignable by each Holder to any Affiliate of such Holder or any other Holder or Affiliate of any other Holder of all or a portion
of the Registrable Securities if: (i) the Holder agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement is furnished to the Company within a reasonable time after such assignment, (ii) the Company is,
within a reasonable time after such transfer or assignment, furnished with written notice of (a) the name and address of such transferee or assignee, and (b) the securities with respect to which such registration rights are being transferred or
assigned, (iii) following such transfer or assignment the further disposition of such securities by the transferee or assignees is restricted under the Securities Act and applicable state securities laws, (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this Section, the transferee or assignee agrees in writing with the Company to be bound by all of the provisions of this Agreement, and (v) such transfer shall have been made in accordance
with the applicable requirements of the Purchase Agreement. In addition, each Holder shall have the right to assign its rights hereunder to any other Person with the prior written consent of the Company, which consent shall not be unreasonably
withheld. The rights to assignment shall apply to the Holders (and to subsequent) successors and assigns. 
  
 (j) Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original
and, all of which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid 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 the original thereof. 
  
 (k) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to
principles of conflicts of law thereof. 
  
 (l) Cumulative
Remedies. The remedies provided herein are cumulative and not exclusive of any remedies provided by law. 
  
 (m) Severability. If any term, provision, covenant or restriction of this Agreement is held to be invalid, illegal, void or unenforceable in any
respect, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their reasonable efforts to
find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable. 
  
 (n) Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not
be deemed to limit or affect any of the provisions hereof. 
  

 -14- 

 (o) Shares Held by the Company and its Affiliates. Whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder, Registrable Securities held by the Company or its Affiliates (other than any Holder or transferees or successors or assigns thereof if such Holder is deemed to be an Affiliate
solely by reason of its holdings of such Registrable Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage. 
  
 (p) Independent Nature of Purchasers. The Company acknowledges that the obligations of each Purchaser under the
Transaction Documents are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser under the Transaction Documents. The Company
acknowledges that the decision of each Purchaser to purchase securities pursuant to the Purchase Agreement has been made by such Purchaser independently of any other purchase and independently of any information, materials, statements or opinions as
to the business, affairs, operations, assets, properties, liabilities, results of operations, condition (financial or otherwise) or prospects of the Company or of its Subsidiaries which may have made or given by any other Purchaser or by any agent
or employee of any other Purchaser, and no Purchaser or any of its agents or employees shall have any liability to any Purchaser (or any other person) relating to or arising from any such information, materials, statements or opinions. The Company
acknowledges that nothing contained herein, or in any Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto (including, but not limited to, the (i) inclusion of a Purchaser in the Registration Statement and (ii)
review by, and consent to, such Registration Statement by a Purchaser) shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any
way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. The Company acknowledges that each Purchaser shall be entitled to independently protect and enforce its rights,
including without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose. The
Company acknowledges that for reasons of administrative convenience only, the Transaction Documents have been prepared by counsel for one of the Purchasers and such counsel does not represent all of the Purchasers but only such Purchaser and the
other Purchasers have retained their own individual counsel with respect to the transactions contemplated hereby. The Company acknowledges that it has elected to provide all Purchasers with the same terms and Transaction Documents for the
convenience of the Company and not because it was required or requested to do so by the Purchasers. The Company acknowledges that such procedure with respect to the Transaction Documents in no way creates a presumption that the Purchasers are in any
way acting in concert or as a group with respect to the Transaction Documents or the transactions contemplated hereby or thereby. 
  
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 
  

 -15- 

 IN WITNESS WHEREOF, the parties hereto have caused this Registration Rights Agreement to be duly executed
by their respective authorized persons as of the date first indicated above. 
  

			
	 SAFLINK CORPORATION

		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	
	 PURCHASER:

		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	
	 PURCHASER:

		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	
	 PURCHASER:

		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 

  

 -16- 

 Schedule I 
 List of Purchasers  
  

 -17-First Amendment To Credit Agreement and Revolving Credit Notes

 Exhibit 10.2 
  
 FIRST AMENDMENT TO 
 CREDIT AGREEMENT AND REVOLVING CREDIT NOTES 
  
 THIS FIRST AMENDMENT TO CREDIT AGREEMENT AND REVOLVING CREDIT NOTES (this “Amendment”) is made as of the 31st day of December, 2003 by and among MTC TECHNOLOGIES, INC., a Delaware corporation (“MTCT”), MTC
TECHNOLOGIES, INC. (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (together with MTCT, collectively, “Borrowers” and, individually, each a “Borrower”); the financial institutions listed on
Schedule 1 to the Credit Agreement (collectively, the “Banks” and, individually, each a “Bank”); and NATIONAL CITY BANK, as lead arranger and administrative agent for the Banks (“Agent”)
under the following circumstances: 
  
 A. The Borrowers, the
Agent and the Banks are parties to a Credit Agreement dated as of January 31, 2003 (as the same may be amended, supplemented, modified and/or restated from time to time, the “Credit Agreement”). Unless otherwise defined herein, all
capitalized terms used herein shall have the respective meanings ascribed to those terms by the Credit Agreement. 
  
 B. Pursuant to the Credit Agreement, the Banks have provided the Revolving Loans to the Borrowers which are evidenced by Revolving Credit Notes dated as
of January 31, 2003 (collectively, as the same may be amended, supplemented, modified and/or restated from time to time, the “Original Revolving Credit Notes”). 
  
 C. The Borrowers, the Agent and the Banks now desire to amend the Credit Agreement and the Original Revolving Credit Notes
for the reasons and upon the terms and conditions hereinafter set forth. 
  
 NOW, THEREFORE, the Borrowers, the Agent and the Banks agree as follows: 
  
 Section 1. Amendment to Credit Agreement. 
  
 (a) Amendment to Preamble. Subsection (b) of the Preamble to the Credit Agreement is hereby amended in its entirety to read as follows: 

 
 (b) and MTC TECHNOLOGIES, INC., formerly known as MODERN
TECHNOLOGIES CORP., an Ohio corporation, (together with MTCT, collectively, “Borrowers” and, individually, each a “Borrower”); 

 (b) Amendment to Article I. Article I to the Credit Agreement is amended by adding the following
new Section 1.4 immediately following Section 1.3: 
  
 1.4 USA
Patriot Act Notification. The following notification is provided to the Borrowers pursuant to Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318: 
  
 (a) IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the government fight the
funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person or entity that opens an account, including any deposit account, treasury
management account, loan, other extension of credit, or other financial services product. What this means for the Borrowers: When a borrower opens an account, if borrower is an individual, the applicable bank will ask for borrower’s name,
taxpayer identification number, residential address, date of birth and other information that will allow such bank to identify borrower, and, if borrower is not an individual, such bank will ask for borrower’s name, taxpayer identification
number, business address, and other information that will allow such bank to identify borrower. The bank may also ask, if borrower is an individual, to see borrower’s driver’s license or other identifying documents, and, if borrower is not
an individual, to see borrower’s legal organizational documents or other identifying documents. 
  
 (b) Government Regulation. The Borrowers shall not (a) be or become subject at any time to any law, regulation, or list of any government
agency (including, without limitation, the U.S. Office of Foreign Asset Control list) that prohibits or limits the Agent or Banks from making any advance or extension of credit to the Borrowers or from otherwise conducting business with the
Borrowers, or (b) fail to provide documentary and other evidence of the borrower identity as may be requested by Agent or Banks at any time to enable Agent or Banks to verify the Borrowers’ identity or to comply with any applicable law or
regulation, including, without limitation, Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318. 
  
 (c) Amendment to Section 1.1. Section 1.1 of the Credit Agreement is hereby amended by deleting the current definitions of “Capital
Distribution”, “Maximum Commitment Amount” and “Total Commitment Amount” and replacing them with the following new definitions: 
  
 “Capital Distribution” shall mean a payment made, liability incurred or other consideration given by any Company to any Person
that is not a Company, for the purchase, acquisition, redemption, repurchase or retirement of any capital stock or other equity interest of such Company or as a dividend, return of capital or other distribution in respect of such Company’s
capital stock or other equity interest, but shall not include the following: (a) any stock dividend, stock split or other equity distribution payable only in capital stock or other equity of such Company, (b) any transaction pursuant to the 2002
Equity and Performance 
  

 2 

 Incentive Plan of the Borrowers, (c) any dividend, return of capital or other distribution in respect of
such Company’s capital stock or other equity interest so long as such Company shall have demonstrated to the satisfaction of Agent no less than 5 Business Days prior to such distribution, evidence satisfactory to Agent of compliance with the
following: (i) no Default or an Event of Default shall then exist, or immediately after giving effect to any such distribution would exist, and (ii) the Leverage Ratio shall be less than 1.50 to 1.00 both prior to and immediately after giving effect
to any such distribution. 
  
 “Maximum
Commitment Amount” shall mean Eighty Million Dollars ($80,000,000), or such other amount as shall be determined pursuant to Section 2.11 hereof. 
  
 “Total Commitment Amount” shall mean Fifty-Five Million Dollars ($55,000,000), as such amount may be increased up to the Maximum
Commitment Amount pursuant to Section 2.11(b) hereof, or decreased pursuant to Section 2.11(a) hereof. 
  
 (d) Amendment to Section 2.11(b). Section 2.11(b) of the Credit Agreement is hereby amended in its entirety to provide as follows: 
  
 (b) Increase in Commitment. At any time during the
Commitment Increase Period, Administrative Borrower may request that Agent increase the Total Commitment Amount to the Maximum Commitment Amount by either (i) increasing, for one or more Banks, with and subject to their prior written consent, their
respective Revolving Credit Commitments, or (ii) with and subject to the prior written consent of Agent, including one or more Additional Banks, each with a new Revolving Credit Commitment, as a party to this Agreement (collectively, the
“Additional Commitment”). During the Commitment Increase Period, the Banks agree that Agent, in its sole discretion, may permit one or more Additional Commitments upon satisfaction of the following requirements: (A) each Additional Bank,
if any, shall execute an Additional Bank Assumption Agreement, (B) Agent shall provide to each Bank a revised Schedule 1 to this Agreement, including revised Commitment Percentages for each of the Banks, if appropriate, at least three
Business Days prior to the effectiveness of such Additional Commitments (each an “Additional Bank Assumption Effective Date”), and (C) Borrowers shall execute and deliver to Agent and the Banks such replacement or additional Revolving
Credit Notes as shall be required by Agent. The Banks hereby authorize Agent to execute each Additional Bank Assumption Agreement on behalf of the Banks. On each Additional Bank Assumption Effective Date, the Banks shall make adjustments among
themselves with respect to the Revolving Loans then outstanding and amounts of principal, interest, commitment fees and other amounts paid or payable with respect thereto as shall be necessary, in the opinion of Agent, in order to reallocate among
such Banks such outstanding amounts, based on the revised Commitment Percentages and to otherwise carry out fully the intent and terms of this subsection (b). It is a 
  

 3 

 condition precedent to Borrowers’ ability to request any increase in the Total Commitment Amount
pursuant to this subsection (b) that Borrowers shall have demonstrated to the satisfaction of the Agent compliance with each of the following: (x) no Default or Event of Default shall then exist, or immediately after giving effect to any such
increase would exist, and (y) MTCT shall have completed a secondary stock offering raising a minimum of $50,000,000 in additional equity. Borrowers shall pay any attorneys’ fees or other expenses of Agent in connection with the documentation of
any such increase, as well as such other fees as may be agreed upon between Borrowers and Agent. 
  
 (e) Amendment to Section 5.7(f). Section 5.7(f) of the Credit Agreement shall be amended in its entirety to read as follows: 
  
 (f) Capital Expenditures. Borrowers will not make or
commit to make Capital Expenditures exceeding 1.5% of annual Consolidated revenues of Borrowers in any fiscal year of Borrowers. 
  
 (f) Amendment to Section 5.13 of the Credit Agreement. Section 5.13 of the Credit Agreement shall be amended in its entirety to read as follows:

  
 Section 5.13. Acquisitions. No Company
shall effect an Acquisition; provided, however, that a Credit Party may effect an Acquisition so long as: 
  
 (a) in the case of a merger, amalgamation or other combination including a Borrower, such Borrower shall be the surviving entity;

  
 (b) in the case of a merger, amalgamation or
other combination including a Credit Party (other than a Borrower), a Credit Party shall be the surviving entity; 
  
 (c) the business to be acquired shall be similar to the lines of business of the Companies; 
  
 (d) the Acquisition is non-hostile; 
  
 (e) the entity which is the target of the Acquisition shall
have projected Consolidated EBITDA for the first 12-month period following the closing of such Acquisition of not less than 10% of the total purchase price of such target (for purposes of this subsection (e), any reference to “MTCT” in the
definition of “Consolidated EBITDA” or in the definition of any defined term comprising such definition shall be a reference to the target of the Acquisition); 
  
 (f) no Default or Event of Default shall exist prior to or after giving effect to such Acquisition;

  

 4 

 (g) Borrowers shall have provided to Agent and the Banks, at least ten (10) days prior to
such Acquisition, historical financial statements of the target entity and a pro forma financial statement of the Companies accompanied by a certificate of a Financial Officer of a Borrower showing pro forma compliance with Section 5.7 hereof, both
before and after the proposed Acquisition; and 
  
 (h) immediately after the consummation of such Acquisition, the amount equal to (i) the Total Commitment Amount minus (ii) the Revolving Credit Exposure shall be no less than Ten Million Dollars ($10,000,000). 
  
 (g) Amendment to Schedule 1 to the Credit Agreement. Schedule 1
to the Credit Agreement shall be deleted and replaced with the new Schedule 1 attached hereto. 
  
 Section 2. Amendment to Original Revolving Credit Notes and Loan Documents. 
  
 (a) The “Revolving Credit Note” or “Revolving Credit Notes” referred to in the Loan Documents shall mean
the Amended and Restated Revolving Credit Notes in the form attached hereto as Exhibits A-1, A-2, A-3, and A-4 respectively. 
  
 (b) Each and every reference in the Loan Documents to “Modern Technologies Corp.” shall be a reference to “MTC Technologies, Inc.”

  
 Section 3. Effective Date. This Amendment shall take
effect immediately upon the satisfaction, in the Agent’s sole discretion, of the following conditions precedent: 
  
 (a) Agent’s receipt of an original counterpart of this Amendment executed by all parties hereto; 
  
 (b) Agent’s receipt of the original Confirmation of Guarantees executed
by Amcomp Corporation, International Consultants, Inc. and Vitronics Inc. (collectively, the “Guarantors”); 
  
 (c) Agent’s receipt of the Amended and Restated Revolving Credit Notes executed by Borrowers; 
  
 (d) Agents’s receipt of the following, certified as true and correct and
in full force and effect by a duly authorized officer of each Borrower and each Guarantor: 
  
 (i) resolutions of each of the Board of Directors of each Borrower and each Guarantor authorizing execution, delivery and performance of
this Amendment or Confirmation of Guarantee, as applicable, and all other documents executed and delivered in connection herewith to which each is a party; 
  
 (ii) the articles of incorporation of each Borrower and each Guarantor, as certified by the Secretary of State of the state of
incorporation of such entity; and 
  

 5 

 (iii) the bylaws or code of regulations of each Borrower and each Guarantor. 

 
 (e) Receipt by Agent of an opinion of counsel to Borrowers and Guarantors,
in form and substance satisfactory to Agent; 
  
 (f) Receipt by
each Bank of an amendment fee in the amount equal to 12.5 bps multiplied by the increase of each Bank’s Maximum Amount as set forth on Schedule 1 over such Bank’s pro-rata portion of the Closing Commitment Amount; and 
  
 (g) Receipt by Agent of all out-of-pocket costs and expenses incurred in
making the Loans and entering into this Agreement (including, without limitation, all reasonable attorney fees, audit fees and filing fees incurred by Agent). 
  

Section 4. Costs and Expenses. The Borrowers hereby agree to reimburse the Agent and Banks for all costs and expenses incurred by Agent and
Banks, in connection with this Amendment and the transactions contemplated hereby, including its respective legal fees and expenses. 
  
 Section 5. Miscellaneous. Agent, the Banks and each Borrower hereby agree that: 
  
 (a) The Credit Agreement, the Revolving Credit Notes and the other Loan Documents, as amended hereby, remain otherwise
unmodified and in full force and effect. 
  
 (b) Each Borrower
hereby represents and warrants to Agent and the Banks that (i) no Default or Event of Default has occurred and is continuing (ii) the representations and warranties of such Borrower in the Credit Agreement and the other Loan Documents are true and
correct in all material respects as if made on the date hereof (except to the extent that any expressly relates to an earlier date), and (iii) such Borrower has no cause of action, at law or in equity, against Agent or the Banks, including, without
limitation, any offset, counterclaim or defense with respect to the Notes (including the Swing Line Note) or the Loans evidenced thereby or any Loan Document. 
  

(c) This Amendment is limited precisely as written and shall not (i) constitute a consent under or waiver or modification of any other term or
condition of the Credit Agreement, the other Loan Documents or any other agreements, instruments or documents referred to therein, or (ii) prejudice or otherwise affect any right or privilege which Agent or the Banks now have or may have in the
future under the Credit Agreement, the other Loan Documents or under any of the other agreements, documents or instruments therein. 
  
 (d) This Amendment may be executed in any one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. 
  
 (e) This Amendment shall be
governed by, and construed and enforced in accordance with, the laws of the State of Ohio. 
  

 6 

 IN WITNESS WHEREOF, the parties hereto have caused a counterpart of this Amendment to be duly executed
and delivered as of the date first above written. 
  

							
	 Address:
	 	 4032 Linden Avenue
 Dayton, OH 45432
 Attention: David Gutridge
 Fax: (937) 252-8240
	 	 MTC TECHNOLOGIES, INC., a Delaware corporation
  

	 	 	 	 By:
	 	 /s/ David S. Gutridge

	 	 	 	 Name:
	 	 David S. Gutridge

	 	 	 	 Title:
	 	 Chief Executive Officer and Secretary

			
	 Address:
	 	 4032 Linden Avenue
 Dayton, OH 45432
 Attention: David Gutridge
 Fax: (937) 252-8240
	 	 MTC TECHNOLOGIES, INC., formerly known as MODERN TECHNOLOGIES CORP., an Ohio corporation
  

	 	 	 	 By:
	 	 /s/ David S. Gutridge

	 	 	 	 Name:
	 	 David S. Gutridge

	 	 	 	 Title:
	 	 Chief Executive Officer and Secretary

			
	 Address:
	 	 629 Euclid Avenue
 LOC. 01-3034
 Cleveland, Ohio 44114
 Attention: Capital Markets Division
 - Loan Syndications
 Fax: (216) 222-7079
	 	 NATIONAL CITY BANK as Agent and as a Bank
  

	 	 	 	 By:
	 	 /s/ Neal J. Hinker

	 	 	 	 Name:
	 	 Neal J. Hinker

	 	 	 	 Title:
	 	 Senior Vice President

  
 [SIGNATURES OF BANKS
CONTINUE ON NEXT PAGE] 
  

 7 

							
	 Address:
	 	 34 North Main Street
 Dayton Ohio 45402
 Attention: Michael Dunlavey
 Fax: (937) 586-7695
	 	 KEYBANK NATIONAL ASSOCIATION
  

	 	 	 	 By:
	 	 /s/ R. Michael Dunlavey

	 	 	 	 Name:
	 	 R. Michael Dunlavey

	 	 	 	 Title:
	 	 Vice President

			
	 Address:
	 	 110 North Main Street
 Dayton OH 45402
 Attention: Neal Ratliff
 Fax: (937) 227-3027
	 	 FIFTH THIRD BANK
  

	 	 	 	 By:
	 	 /s/ Neal R. Ratliff

	 	 	 	 Name:
	 	 Neal R. Ratliff

	 	 	 	 Title:
	 	 Vice President

			
	 Address:
	 	 200 West Second Street
 16th Floor
 Winston-Salem,
 North Carolina 27101
 Attention: Roberts Bass
 Fax: (336) 733-2740
	 	 BRANCH BANKING AND TRUST COMPANY
  

	 	 	 	 By:
	 	 /s/ Roberts A. Bass

	 	 	 	 Name:
	 	 Roberts A. Bass

	 	 	 	 Title:
	 	 Senior Vice President

  

 8 

 SCHEDULE 1 
  

							
	 BANKING
 INSTITUTIONS

	  	 COMMITMENT
 PERCENTAGE

	 	 REVOLVING
 CREDIT
 COMMITMENT
 AMOUNT

	  	MAXIMUM
AMOUNT

	 National City Bank
	  	31.8181%	 	$17,500,000	  	$17,500,000
	 KeyBank National Association
	  	22.7272%	 	$12,500,000	  	$12,500,000
	 Fifth Third Bank
	  	22.7272%	 	$12,500,000	  	$12,500,000
	 Branch Banking and Trust Company
	  	22.7272%	 	$12,500,000	  	$12,500,000
	 Total Commitment Amount
	  	100%	 	$55,000,000	  	$55,000,000
	 	  	
	 	
	  	

	 	  	(approximately)	 	 	  	 

  

 9 

 CONFIRMATION OF GUARANTY 
  
 The undersigned, AMCOMP CORPORATION, a California corporation (“Amcomp”), INTERNATIONAL CONSULTANTS, INC., an Ohio
corporation (“ICI”), and VITRONICS INC., a New Jersey corporation (“Vitronics” and collectively with Amcomp and ICI, the “Guarantors”), jointly and severally hereby: 
  
 (A) Acknowledge that MTC TECHNOLOGIES, INC., a Delaware corporation
(“MTCT”), MTC TECHNOLOGIES, INC. (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (together with MTCT, collectively, “Borrowers” and, individually, each a “Borrower”), the
financial institutions listed on Schedule 1 to the Credit Agreement (defined herein) (collectively, the “Banks” and, individually, each a “Bank”); and NATIONAL CITY BANK, as lead arranger and administrative
agent for the Banks (“Agent”) have entered into that certain Credit and Security Agreement dated as of January 31, 2003, as amended by a First Amendment to Credit Agreement dated as of December 31, 2003 (as so amended and as may be
further amended from time to time, the “Credit Agreement”), whereby the Banks have extended financial accommodations to the Borrowers, and the Borrowers have executed Notes (as defined in the Credit Agreement) in favor of the Banks,
in evidence thereof. Terms used but not defined herein shall have the meaning ascribed thereto in the Credit Agreement. 
  
 (B) Acknowledge that the Amended and Restated Revolving Credit Notes evidencing the Revolving Loans are each a “Note” under the Credit
Agreement, along with the Swing Line Note, and other notes delivered pursuant to the Credit Agreement. 
  
 (C) Acknowledge that the Guarantors have guaranteed payment of the principal and interest of all Notes pursuant to a Guaranty of Payment of Debt dated as
of January 31, 2003 in the case of Amcomp, and a Guaranty of Payment of Debt dated as of October 6, 2003 in the case of ICI, and a Guaranty of Payment of Debt dated as of the date hereof in the case of Vitronics (collectively, the
“Guarantees”). 
  
 (D) Acknowledge that the
Guarantors have each received and had an opportunity to review the First Amendment to Credit Agreement referred to in the first paragraph of this Confirmation of Guaranty and consent to the amendments to the Credit Agreement, including without
limitation the increase in the Total Commitment Amount from $35,000,000 to $55,000,000, as such amount may be further increased in accordance with the Credit Agreement, and the Maximum Commitment Amount from $50,000,000 to $80,000,000, as such
amount may be further increased in accordance with the Credit Agreement. 
  
 (E) Represent and warrant to the Agent and the Banks that the undersigned have no defenses, offsets or counterclaims, either individually or jointly, with respect to their obligations under the Guarantees and the
Guarantees remain unmodified and in full force and effect. 
  
 [REMAINDER OF PAGE IS INTENTIONALLY BLANK.] 
  

 10 

 This Confirmation of Guaranty is executed as of the 31st day of December, 2003. 
  

			
	AMCOMP CORPORATION, a California corporation
		
	 By:
	 	 /s/ David S. Gutridge

	 Name:
	 	 David S. Gutridge

	 Title:
	 	Chief Financial Officer, Vice President and Secretary
	
	INTERNATIONAL CONSULTANTS, INC., an Ohio corporation
		
	 By:
	 	 /s/ David S. Gutridge

	 Name:
	 	 David S. Gutridge

	 Title:
	 	Chairman, Executive Vice President and CFO
	
	 VITRONICS INC., a New Jersey corporation

		
	 By:
	 	 /s/ David S. Gutridge

	 Name:
	 	 David S. Gutridge

	 Title:
	 	 President

  

 11 

 EXHIBIT A-1 
  
 AMENDED AND RESTATED 
 REVOLVING CREDIT NOTE 
  

			
	 $17,500,000.00
	 	Dayton, Ohio
	 	 	December 31, 2003

  
 FOR VALUE RECEIVED,
the undersigned, MTC TECHNOLOGIES, INC., a Delaware corporation, and MTC TECHNOLOGIES, INC., (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (collectively, “Borrowers” and, individually, each a “Borrower”),
jointly and severally, promise to pay, on the last day of the Commitment Period, as defined in the Credit Agreement (as hereinafter defined), to the order of NATIONAL CITY BANK (“Bank”) at the main office of NATIONAL CITY BANK, as Agent,
as hereinafter defined, 1900 East 9th Street, Cleveland, Ohio 44114-3484, the principal sum of SEVENTEEN MILLION
FIVE HUNDRED THOUSAND DOLLARS ($17,500,000.00) or the aggregate unpaid principal amount of all Revolving Loans made by Bank to Borrowers pursuant to Section 2.2 of the Credit Agreement, whichever is less, in lawful money of the United States of
America. 
  
 As used herein, “Credit Agreement” means
the Credit and Security Agreement dated as of January 31, 2003, among Borrowers, the Banks, as defined therein, and National City Bank, as lead arranger and administrative agent for the Banks (“Agent”), as amended by the First Amendment to
Credit Agreement and Revolving Credit Notes dated as of December 31, 2003, and as the same may be further amended, restated or otherwise modified from time to time. Each capitalized term used herein that is defined in the Credit Agreement and not
otherwise defined herein shall have the meaning ascribed to it in the Credit Agreement. This Note amends, restates and replaces that certain Revolving Note dated as of January 31, 2003 by Borrowers in favor of the Bank in its entirety. 

 
 Borrowers also promise to pay interest on the unpaid principal amount of
each Revolving Loan from time to time outstanding, from the date of such Revolving Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.5 of the Credit Agreement. Such
interest shall be payable on each date provided for in such Section 2.5; provided, however, that interest on any principal portion that is not paid when due shall be payable on demand. 
  
 The portions of the principal sum hereof from time to time representing Base Rate Loans and LIBOR Loans, and payments of
principal of any thereof, shall be shown on the records of Bank by such method as Bank may generally employ; provided, however, that failure to make any such entry shall in no way detract from the obligations of Borrowers under this Note.

  
 If this Note shall not be paid at maturity, whether such
maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Credit Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a rate per annum
equal to the Default Rate. All payments of principal of and interest on this Note shall be made in immediately available funds. In the event of a failure to pay interest or principal, when the same becomes due, Bank may collect and Borrowers agree
to pay a late charge of an amount equal to the greater of (a) ten percent (10%) of the amount of such late payment, or (b) Twenty-Five Dollars ($25). 
  

 12 

 This Note is one of the Revolving Credit Notes referred to in the Credit Agreement. Reference is made to
the Credit Agreement for a description of the right of the undersigned to anticipate payments hereof, the right of the holder hereof to declare this Note due prior to its stated maturity, and other terms and conditions upon which this Note is
issued. 
  
 Except as expressly provided in the Credit Agreement,
Borrowers expressly waive presentment, demand, protest and notice of any kind. 
  
 Each of the undersigned, to the extent permitted by law, hereby waives any right to have a jury participate in resolving any dispute, whether sounding in contract, tort or otherwise, between the undersigned (or any of
them) and the holder of this Note arising out of, in connection with, related to, or incidental to the relationship established between them in connection with this Note and the Credit Agreement or the transactions related thereto. 
  

			
	MTC TECHNOLOGIES, INC., a Delaware corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	MTC TECHNOLOGIES, INC., formerly known as MODERN TECHNOLOGIES CORP., an Ohio corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 13 

 EXHIBIT A-2 
  
 AMENDED AND RESTATED 
 REVOLVING CREDIT NOTE 
  

			
	 $12,500,000.00
	 	Dayton, Ohio
	 	 	December 31, 2003

  
 FOR VALUE RECEIVED,
the undersigned, MTC TECHNOLOGIES, INC., a Delaware corporation, and MTC TECHNOLOGIES, INC., (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (collectively, “Borrowers” and, individually, each a “Borrower”),
jointly and severally, promise to pay, on the last day of the Commitment Period, as defined in the Credit Agreement (as hereinafter defined), to the order of KEYBANK NATIONAL ASSOCIATION (“Bank”) at the main office of NATIONAL CITY BANK,
as Agent, as hereinafter defined, 1900 East 9th Street, Cleveland, Ohio 44114-3484, the principal sum of TWELVE
MILLION FIVE HUNDRED THOUSAND DOLLARS ($12,500,000.00) or the aggregate unpaid principal amount of all Revolving Loans made by Bank to Borrowers pursuant to Section 2.2 of the Credit Agreement, whichever is less, in lawful money of the United States
of America. 
  
 As used herein, “Credit Agreement” means
the Credit and Security Agreement dated as of January 31, 2003, among Borrowers, the Banks, as defined therein, and National City Bank, as lead arranger and administrative agent for the Banks (“Agent”), as amended by the First Amendment to
Credit Agreement and Revolving Credit Notes dated as of December 31, 2003, and as the same may be further amended, restated or otherwise modified from time to time. Each capitalized term used herein that is defined in the Credit Agreement and not
otherwise defined herein shall have the meaning ascribed to it in the Credit Agreement. This Note amends, restates and replaces that certain Revolving Note dated as of January 31, 2003 by Borrowers in favor of the Bank in its entirety. 

 
 Borrowers also promise to pay interest on the unpaid principal amount of
each Revolving Loan from time to time outstanding, from the date of such Revolving Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.5 of the Credit Agreement. Such
interest shall be payable on each date provided for in such Section 2.5; provided, however, that interest on any principal portion that is not paid when due shall be payable on demand. 
  
 The portions of the principal sum hereof from time to time representing Base Rate Loans and LIBOR Loans, and payments of
principal of any thereof, shall be shown on the records of Bank by such method as Bank may generally employ; provided, however, that failure to make any such entry shall in no way detract from the obligations of Borrowers under this Note.

  
 If this Note shall not be paid at maturity, whether such
maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Credit Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a rate per annum
equal to the Default Rate. All payments of principal of and interest on this Note 
  

 14 

 shall be made in immediately available funds. In the event of a failure to pay interest or principal, when the same
becomes due, Bank may collect and Borrowers agree to pay a late charge of an amount equal to the greater of (a) ten percent (10%) of the amount of such late payment, or (b) Twenty-Five Dollars ($25). 
  
 This Note is one of the Revolving Credit Notes referred to in the Credit
Agreement. Reference is made to the Credit Agreement for a description of the right of the undersigned to anticipate payments hereof, the right of the holder hereof to declare this Note due prior to its stated maturity, and other terms and
conditions upon which this Note is issued. 
  
 Except as expressly
provided in the Credit Agreement, Borrowers expressly waive presentment, demand, protest and notice of any kind. 
  
 Each of the undersigned, to the extent permitted by law, hereby waives any right to have a jury participate in resolving any dispute, whether sounding in
contract, tort or otherwise, between the undersigned (or any of them) and the holder of this Note arising out of, in connection with, related to, or incidental to the relationship established between them in connection with this Note and the Credit
Agreement or the transactions related thereto. 
  

			
	MTC TECHNOLOGIES, INC., a Delaware corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	MTC TECHNOLOGIES, INC., formerly known as MODERN TECHNOLOGIES CORP., an Ohio corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 15 

 EXHIBIT A-3  
  
 AMENDED AND RESTATED 
 REVOLVING CREDIT NOTE 
  

			
	 $12,500,000.00
	 	Dayton, Ohio
	 	 	December 31, 2003

  
 FOR VALUE RECEIVED,
the undersigned, MTC TECHNOLOGIES, INC., a Delaware corporation, and MTC TECHNOLOGIES, INC., (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (collectively, “Borrowers” and, individually, each a “Borrower”),
jointly and severally, promise to pay, on the last day of the Commitment Period, as defined in the Credit Agreement (as hereinafter defined), to the order of FIFTH THIRD BANK (“Bank”) at the main office of NATIONAL CITY BANK, as Agent, as
hereinafter defined, 1900 East 9th Street, Cleveland, Ohio 44114-3484, the principal sum of TWELVE MILLION FIVE
HUNDRED THOUSAND DOLLARS ($12,500,000.00) or the aggregate unpaid principal amount of all Revolving Loans made by Bank to Borrowers pursuant to Section 2.2 of the Credit Agreement, whichever is less, in lawful money of the United States of America.

  
 As used herein, “Credit Agreement” means the Credit
and Security Agreement dated as of January 31, 2003, among Borrowers, the Banks, as defined therein, and National City Bank, as lead arranger and administrative agent for the Banks (“Agent”), as amended by the First Amendment to Credit
Agreement and Revolving Credit Notes dated as of December 31, 2003, and as the same may be further amended, restated or otherwise modified from time to time. Each capitalized term used herein that is defined in the Credit Agreement and not otherwise
defined herein shall have the meaning ascribed to it in the Credit Agreement. This Note amends, restates and replaces that certain Revolving Note dated as of January 31, 2003 by Borrowers in favor of the Bank in its entirety. 
  
 Borrowers also promise to pay interest on the unpaid principal amount of each
Revolving Loan from time to time outstanding, from the date of such Revolving Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.5 of the Credit Agreement. Such
interest shall be payable on each date provided for in such Section 2.5; provided, however, that interest on any principal portion that is not paid when due shall be payable on demand. 
  
 The portions of the principal sum hereof from time to time representing Base Rate Loans and LIBOR Loans, and payments of
principal of any thereof, shall be shown on the records of Bank by such method as Bank may generally employ; provided, however, that failure to make any such entry shall in no way detract from the obligations of Borrowers under this Note.

  
 If this Note shall not be paid at maturity, whether such
maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Credit Agreement, the principal hereof and the unpaid interest thereon shall bear interest, until paid, at a 
  

 16 

 rate per annum equal to the Default Rate. All payments of principal of and interest on this Note shall be made in
immediately available funds. In the event of a failure to pay interest or principal, when the same becomes due, Bank may collect and Borrowers agree to pay a late charge of an amount equal to the greater of (a) ten percent (10%) of the amount of
such late payment, or (b) Twenty-Five Dollars ($25). 
  
 This Note
is one of the Revolving Credit Notes referred to in the Credit Agreement. Reference is made to the Credit Agreement for a description of the right of the undersigned to anticipate payments hereof, the right of the holder hereof to declare this Note
due prior to its stated maturity, and other terms and conditions upon which this Note is issued. 
  
 Except as expressly provided in the Credit Agreement, Borrowers expressly waive presentment, demand, protest and notice of any kind. 
  
 Each of the undersigned, to the extent permitted by law, hereby waives any
right to have a jury participate in resolving any dispute, whether sounding in contract, tort or otherwise, between the undersigned (or any of them) and the holder of this Note arising out of, in connection with, related to, or incidental to the
relationship established between them in connection with this Note and the Credit Agreement or the transactions related thereto. 
  

			
	MTC TECHNOLOGIES, INC., a Delaware corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	MTC TECHNOLOGIES, INC., formerly known as MODERN TECHNOLOGIES CORP., an Ohio corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 17 

 EXHIBIT A-4 
  
 AMENDED AND RESTATED 
 REVOLVING CREDIT NOTE 
  

			
	 $12,500,000.00
	 	Dayton, Ohio
	 	 	December 31, 2003

  
 FOR VALUE RECEIVED,
the undersigned, MTC TECHNOLOGIES, INC., a Delaware corporation, and MTC TECHNOLOGIES, INC., (formerly known as MODERN TECHNOLOGIES CORP.), an Ohio corporation (collectively, “Borrowers” and, individually, each a “Borrower”),
jointly and severally, promise to pay, on the last day of the Commitment Period, as defined in the Credit Agreement (as hereinafter defined), to the order of BRANCH BANKING AND TRUST COMPANY (“Bank”) at the main office of NATIONAL CITY
BANK, as Agent, as hereinafter defined, 1900 East 9th Street, Cleveland, Ohio 44114-3484, the principal sum of
TWELVE MILLION FIVE HUNDRED THOUSAND DOLLARS ($12,500,000.00) or the aggregate unpaid principal amount of all Revolving Loans made by Bank to Borrowers pursuant to Section 2.2 of the Credit Agreement, whichever is less, in lawful money of the United
States of America. 
  
 As used herein, “Credit
Agreement” means the Credit and Security Agreement dated as of January 31, 2003, among Borrowers, the Banks, as defined therein, and National City Bank, as lead arranger and administrative agent for the Banks (“Agent”), as amended by
the First Amendment to Credit Agreement and Revolving Credit Notes dated as of December 31, 2003, and as the same may be further amended, restated or otherwise modified from time to time. Each capitalized term used herein that is defined in the
Credit Agreement and not otherwise defined herein shall have the meaning ascribed to it in the Credit Agreement. This Note amends, restates and replaces that certain Revolving Note dated as of January 31, 2003 by Borrowers in favor of the Bank in
its entirety. 
  
 Borrowers also promise to pay interest on the
unpaid principal amount of each Revolving Loan from time to time outstanding, from the date of such Revolving Loan until the payment in full thereof, at the rates per annum that shall be determined in accordance with the provisions of Section 2.5 of
the Credit Agreement. Such interest shall be payable on each date provided for in such Section 2.5; provided, however, that interest on any principal portion that is not paid when due shall be payable on demand. 
  
 The portions of the principal sum hereof from time to time representing Base
Rate Loans and LIBOR Loans, and payments of principal of any thereof, shall be shown on the records of Bank by such method as Bank may generally employ; provided, however, that failure to make any such entry shall in no way detract from the
obligations of Borrowers under this Note. 
  
 If this Note shall
not be paid at maturity, whether such maturity occurs by reason of lapse of time or by operation of any provision for acceleration of maturity contained in the Credit Agreement, the principal hereof and the unpaid interest thereon shall bear
interest, until paid, at a 
  

 18 

 rate per annum equal to the Default Rate. All payments of principal of and interest on this Note shall be made in
immediately available funds. In the event of a failure to pay interest or principal, when the same becomes due, Bank may collect and Borrowers agree to pay a late charge of an amount equal to the greater of (a) ten percent (10%) of the amount of
such late payment, or (b) Twenty-Five Dollars ($25). 
  
 This Note
is one of the Revolving Credit Notes referred to in the Credit Agreement. Reference is made to the Credit Agreement for a description of the right of the undersigned to anticipate payments hereof, the right of the holder hereof to declare this Note
due prior to its stated maturity, and other terms and conditions upon which this Note is issued. 
  
 Except as expressly provided in the Credit Agreement, Borrowers expressly waive presentment, demand, protest and notice of any kind. 
  
 Each of the undersigned, to the extent permitted by law, hereby waives any
right to have a jury participate in resolving any dispute, whether sounding in contract, tort or otherwise, between the undersigned (or any of them) and the holder of this Note arising out of, in connection with, related to, or incidental to the
relationship established between them in connection with this Note and the Credit Agreement or the transactions related thereto. 
  

			
	MTC TECHNOLOGIES, INC., a Delaware corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

	
	MTC TECHNOLOGIES, INC., formerly known as MODERN TECHNOLOGIES CORP., an Ohio corporation
		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

  

 19

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00061-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00061-of-00352.parquet"}]]