Document:

exv10w2

 

EXHIBIT 10.2

AFFIRMATION AND AMENDMENT OF GUARANTY

                    This AFFIRMATION AND AMENDMENT OF GUARANTY is entered into as of September
30, 2004, by and between SAFEGUARD SCIENTIFICS, INC. (“Guarantor”) and COMERICA
BANK, successor by merger to Comerica Bank – California (“Bank”).

RECITALS

                    Bank, SAFEGUARD DELAWARE, INC. and SAFEGUARD SCIENTIFICS (DELAWARE), INC.
(collectively, the “Borrowers”) are parties to that certain Loan Agreement
dated as of May 10, 2002, as amended by a First Amendment to Loan Agreement
dated as of May 9, 2003, a Second Amendment to Loan Agreement dated as of
February 12, 2004, and a Third Amendment to Loan Agreement dated as of May 8,
2004 (as so amended, the “Loan Agreement”). Guarantor executed for the benefit
of Bank an Unconditional Guaranty (the “Guaranty”), guarantying amounts owing
by Borrowers to Bank. Borrowers and Bank propose to enter into a Fourth
Amendment to Loan Agreement of even date herewith (the “Amendment”), which
amends the Loan Agreement by, among other things, extending additional credit
and increasing its maturity. Bank has agreed to enter into the Amendment
provided, among other things, that Guarantor consents to the Amendment and
agrees that the Guaranty will remain effective. In addition, the parties
desire to amend the Guaranty in accordance with the terms of this Amendment and
Affirmation.

AGREEMENT

                    NOW, THEREFORE, the parties agrees as follows:

                    1.           The last sentence of the introductory paragraph of the Guaranty is
hereby amended to read as follows: “The liability of Guarantor hereunder shall
not exceed a principal amount of $55,000,000 plus interest and the fees and
expenses incurred by Bank in enforcing the Loan Documents.”

                    2.           Guarantor consents to the execution, delivery and performance by
Borrowers of the Amendment and the documents and instruments executed in
connection therewith. The Guaranty is and shall remain in full force and
effect with respect to each Borrower’s Obligations (as defined in the Loan
Agreement), as modified by the Amendment. Guarantor confirms that, as of the
date hereof, Guarantor has no defenses against its obligations under the
Guaranty.

                    3.           The Guaranty, as amended hereby, shall be and remain in full force and
effect in accordance with its respective terms and hereby is ratified and
confirmed in all respects. Except as expressly set forth herein, the
execution, delivery, and performance of this Amendment and Affirmation and
shall not operate as a waiver of, or as an amendment of, any right, power, or
remedy of Bank under the Guaranty, as in effect prior to the date hereof.
Guarantor ratifies and reaffirms the continuing effectiveness of all
instruments, documents and agreements entered into in connection with the
Guaranty.

                    4.           Guarantor represents and warrants that the Representations and
Warranties contained in the Guaranty are true and correct as of the date of
this Amendment and Affirmation (other than those made as of a specific date, as
to which such representations and warranties are true and correct as of such
date). Unless otherwise defined, all capitalized terms in this Amendment and
Affirmation shall be as defined in the Guaranty. This Amendment and
Affirmation may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one instrument.

 

 

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

	 	 	 	 	 
	 	 	SAFEGUARD SCIENTIFICS, INC.
	 
	 	 	 	 
	 
	 	 	 	 
	

	 	By:
	 	/s/ Steve Grenfell
	

	 	 	 	
 
	 
	 	 	 	 
	

	 	Title:
	 	Vice President
	

	 	 	 	
 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	COMERICA BANK
	 
	 	 	 	 
	 
	 	 	 	 
	

	 	By:
	 	/s/ Talene Salmastlian
	

	 	 	 	
 
	 
	 	 	 	 
	

	 	Title:
	 	Corporate Banking Officerexv10w3

 

EXHIBIT 10.3

FOURTH AMENDMENT

TO

LOAN DOCUMENTS

                    This Fourth Amendment to Loan Documents is entered into as of September
30, 2004 (the “Amendment”), by and between COMERICA BANK (“Bank”), ALLIANCE
CONSULTING GROUP ASSOCIATES, INC. (“Consulting”) and ALLIANCE HOLDINGS, INC.,
(“Holdings”; Consulting and Holdings are referred to herein individually as a
“Borrower” and collectively, the “Borrowers”).

RECITALS

                    Borrowers and Bank are parties to that certain Loan and Security Agreement
dated as of September 25, 2003, as amended, including without limitation by
that certain First Amendment to Loan and Security Agreement dated as of
December 12, 2003, that certain Second Amendment to Loan and Security Agreement
dated as of May 27, 2004 and that certain Third Amendment to Loan Documents
dated as of August 9, 2004 (collectively, the “Agreement”) and that certain
LIBOR Addendum to Loan and Security Agreement dated as of September 25, 2003
(the “LIBOR Addendum”). The parties desire to amend the Agreement in
accordance with the terms of this Amendment.

                    NOW, THEREFORE, the parties agree as follows:

                    1.           The following defined terms in Section 1.1 of the Agreement are hereby
amended to read as follows:

                              “Revolving Line” means a credit extension of up to Twenty
Million Dollars ($20,000,000).

                              “Revolving Maturity Date” means February 28, 2006.

                    2.           Section 2.5(a) of the Agreement is hereby amended in its entirety to
read as follows:

                              (a)           Facility Fee. Borrower shall pay to Bank (i) on or
before September 30, 2004, a Commitment Fee equal to $50,000
and (ii) on October 1, 2005, an additional Commitment Fee
equal to $20,833;

                    3.           Exhibit C to the Agreement is hereby amended and replaced in its
entirety by Exhibit C attached hereto.

                    4.           Unless otherwise defined, all initially capitalized terms in this
Amendment shall be as defined in the Agreement. The Agreement, as amended
hereby, shall be and remains in full force and effect in accordance with its
terms and hereby is ratified and confirmed in all respects. Except as
expressly set forth herein, the execution, delivery, and performance of this
Amendment shall not operate as a waiver of, or as an amendment of, any right,
power, or remedy of Bank under the Agreement, as in effect prior to the date
hereof. Each Borrower ratifies and reaffirms the continuing effectiveness of
all promissory notes, guaranties, security agreements, mortgages, deeds of
trust, environmental agreements, and all other instruments, documents and
agreements entered into in connection with the Agreement.

                    5.           Except as set forth in the Schedule of Exceptions originally provided
by Borrower to Bank in connection with the Agreement and the updated Schedule
of Exceptions provided by Borrower to Bank in connection with this Amendment,
each Borrower represents and warrants that the representations and warranties
contained in the Agreement are true and correct as of the date of this
Amendment, and that no Event of Default has occurred and is continuing.

1

 

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

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

                                      (a)           this Amendment, duly executed by Borrowers;

                                      (b)           Affirmation of Subordination;

                                      (c)           Unconditional Guaranty and Corporate Resolutions to Guaranty from each
guarantor;

                                      (d)           a certificate of the Secretary of each Borrower with respect to
incumbency and resolutions authorizing the execution and delivery of this
Amendment;

                                      (e)           disbursement instructions, agreement to provide insurance, and
automatic debit authorization; and

                                      (f)           such other documents, and completion of such other matters, as Bank
may reasonably deem necessary or appropriate.

2

 

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

	 	 	 	 	 
	 	 	ALLIANCE HOLDINGS, INC.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	By:	 	/s/ Steve Grenfell
	 
	 	 	 	
 
	 
	 	 	 	 
	 
	 	Title:	 	Vice President
	 
	 	 	 	
 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	ALLIANCE CONSULTING GROUP ASSOCIATES, INC.
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	By:	 	/s/ Steve Grenfell
	 
	 	 	 	
 
	 
	 	 	 	 
	 
	 	Title:	 	Assistant Treasurer
	 
	 	 	 	
 
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	COMERICA BANK
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	By:	 	/s/ Talene Salmastlian
	 
	 	 	 	
 
	 
	 	 	 	 
	 
	 	Title:	 	Corporate Banking Officer
	 
	 	 	 	
 

3

 

EXHIBIT C

BORROWING BASE CERTIFICATE

 

   Borrower: ALLIANCE CONSULTING GROUP ASSOCIATES, INC. & ALLIANCE HOLDINGS, INC. Lender: Comerica Bank

   Commitment Amount: $20,000,000

 

	 	 	 	 	 	 	 	 	 	 	 
	ACCOUNTS RECEIVABLE	 	 	 	 	 	 	 	 
	1.
	 	Accounts Receivable Book Value as of       	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 
	2.

	 	Additions (please explain on reverse)
	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 
	3.

	 	TOTAL ACCOUNTS RECEIVABLE
	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 
	ACCOUNTS RECEIVABLE DEDUCTIONS (without duplication)	 	 	 	 	 	 	 	 
	4.
	 	Amounts over 90 days due*	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	5.
	 	Balance of 35% over 90 day accounts	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	 
	 	Balance of 50% over 90 day accounts (for account debtors listed on Appendix 1)	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	6.
	 	Concentration Limits	 	 	 	 	 	 	 	 
	7.
	 	Foreign Accounts
	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	8.
	 	Governmental Accounts	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	9.
	 	Contra Accounts	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	10.
	 	Demo Accounts	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	11.
	 	Intercompany/Employee Accounts	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	12.
	 	Other (please explain on reverse)	 	 	$	 	 	 	 	 
	 
	 	 	 	 	 	
 	 	 	 	 
	13.
	 	TOTAL ACCOUNTS RECEIVABLE DEDUCTIONS	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 
	14.
	 	Eligible Accounts (#3 minus #13)	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 
	15.
	 	LOAN VALUE OF ACCOUNTS (85% of #14)	 	 	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	 	 	
 

*or, in the case of Accounts for which an invoice has not been sent, within forty five (45)
days after the date on which an obligation owing to a Borrower arises with respect to such Account

	 	 	 	 	 	 	 	 	 
	BALANCES	 	 	 	 	 	 
	16.
	 	Maximum Loan Amount	 	 	 	 	$	20,000,000
	17.
	 	Total Funds Available [Lesser of #16 or #15]	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	
 
	18.
	 	Present balance owing on Line of Credit	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	
 
	19.
	 	Outstanding under Sublimits (ACH)	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	
 
	20.
	 	RESERVE POSITION (#17 minus #18 and #19)	 	 	 	 	$	 
	 
	 	 	 	 	 	 	 	
 

The undersigned each represents and warrants that the foregoing is true,
complete and correct, and that the information reflected in this Borrowing Base
Certificate complies with the representations and warranties set forth in the
Loan and Security Agreement between the undersigned and Comerica Bank.

	 	 	 	 	 	 	 	 	 
	ALLIANCE CONSULTING GROUP ASSOCIATES, INC.  	 	ALLIANCE HOLDINGS, INC.
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	By:	 	 
	 
	 	
 	 	 	 	 	 	
 
	 
	 	Authorized Signer	 	 	 	 	 	Authorized Signer

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