Document:

exv10w38

 

     Exhibit 10.38

FIRST AMENDMENT TO THE SELLER WARRANT AGREEMENT

     THIS FIRST AMENDMENT TO THE SELLER WARRANT AGREEMENT (the “Amendment”) is
made effective as of December 16, 2004, between Alion Science and Technology
Corporation, a Delaware corporation (the “Company”), and Illinois Institute of
Technology, an Illinois not-for-profit corporation (“IIT”).

     WHEREAS, the Company, IIT Research Institute, an Illinois not-for-profit
corporation affiliated with and controlled by IIT (“IITRI”), and Alion Science
and Technology Corporation Employee Ownership, Savings and Investment Trust
(the “Trust”) entered into that certain Seller Warrant Agreement dated as of
the 20th day of December 2002 (the “Seller Warrant Agreement”), pursuant to
which the Company issued to IITRI warrants to purchase One Million Eighty
Thousand Four Hundred Thirty-Six and Eight-Tenths (1,080,436.8) shares of the
Company’s $0.01 par value per share common stock (“Common Stock”);

     WHEREAS, as of July 1, 2004, IITRI transferred to IIT all its rights and
interests in the Seller Warrant Agreement;

     WHEREAS, the Company and IIT desire to amend Sections 3(l)(v) and 16(e) of
the Seller Warrant Agreement;

     WHEREAS, the Trust is a party to the Seller Warrant Agreement only for the
purposes of Sections 6, 7, 15 and 17 through 25 of the Seller Warrant
Agreement, and pursuant to Section 18 of the Seller Warrant Agreement, Sections
3(l)(v) and 16(e) may be amended by the mutual written agreement of the Company
and IIT, without the need to obtain the Trust’s consent; and

     WHEREAS, the Company and IIT desire to amend the Seller Warrant Agreement
as set forth herein.

     NOW, THEREFORE, in consideration of the premises set forth above and the
respective covenants and agreements contained in this Amendment, and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
mutually acknowledged, and intending to be legally bound, the parties hereto
hereby agree as follows:

     1. Amendments to the Seller Warrant Agreement.

          (a) Section 3(l)(v) of the Seller Warrant Agreement is hereby amended by
deleting the entire text of Section 3(l)(v) and substituting in lieu thereof:

“interests or rights designated as phantom stock issued or granted
by the Company to employees, consultants, officers or directors of
the Company or any of its Subsidiaries in accordance with a
phantom stock plan to be adopted by the
Company’s board of directors after the Effective Date, except for
such amount of phantom stock that, at the time of issuance or
grant, would cause the aggregate

First Amendment to the Seller Warrant Agreement

 

 

number of shares of phantom stock
then outstanding (excluding any shares of phantom stock that have
(x) expired, terminated unexercised or become unexercisable, or
(y) been forfeited or otherwise terminated, surrendered or
cancelled) to be in excess of 225,000 shares of phantom stock.”

          (b) Section 16(e) of the Seller Warrant Agreement is hereby amended by
deleting the entire text of Section 16(e) and substituting in lieu thereof:

“The Company will not issue shares of phantom stock that cause the
number of shares of outstanding phantom stock (excluding any
shares of phantom stock that have expired, terminated unexercised,
or become unexercisable, or that have been forfeited or otherwise
terminated, surrendered or cancelled), at the time of issuance, to
be in excess of 225,000 shares of phantom stock.”

     2. Waiver. IIT hereby irrevocably waives (i) any and all breaches
by the Company of the Company’s covenants set forth in Section 16(e) of the
Seller Warrant Agreement, and (ii) any and all adjustments to the Exercise
Price (as defined in the Seller Warrant Agreement), in each case based upon or
arising out of the issuance by the Company of shares of phantom stock on or
before the effective date of this Amendment, and hereby fully and forever,
effective as of the effective date of this Amendment, releases, discharges and
acquits the Company from any and all claims, demands, causes of action, and/or
damages, which IIT may now or hereafter have or claim to have against the
Company, based in whole or in part upon, or which may arise from the issuance
by the Company of shares of phantom stock on or before the effective date of
this Amendment.

     3. Remainder of the Seller Warrant Agreement Not Affected. Except
as set forth in Section 1 hereof, the terms and provisions of the Seller
Warrant Agreement remain in full force and effect without change, amendment,
waiver or modification.

     4. Ratification. As modified hereby, the Seller Warrant Agreement
and its terms and provisions are hereby ratified for all purposes and in all
respects.

     5. Counterparts. This Amendment may be executed in one or more
counterparts, all of which taken together shall constitute one instrument.

     6. References. From and after the date provided above, all
references to the Seller Warrant Agreement shall be deemed to be references to
the Seller Warrant Agreement as modified hereby.

     7. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard
to the conflict of laws principles thereof.

     8. Conflict. In the event of any conflict between the terms of
this Amendment and the Seller Warrant Agreement, the terms of this Amendment
shall govern.

[Signatures follow on next page]

2

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by its officers thereunto duly authorized as of the date hereof.

	 	 	 	 	 	 	 	 	 	 	 
	Alion Science and Technology Corporation	 	Illinois Institute of Technology
	 
	 	 	 	 	 	 	 	 	 	 
	By:
/s/ Bahman Atefi
	 	By:/s/ Lew Collens

	 		 	 	 	 
	Name: Bahman Atefi	 	Name: Lew Collens
	Title: Chief Executive Officer	 	Title: Presidentexv10w39

 

Exhibit 10.39

FIRST AMENDMENT TO THE ALION MEZZANINE WARRANT

AGREEMENT BETWEEN ALION SCIENCE AND TECHNOLOGY CORPORATION,

ALION SCIENCE TECHNOLOGY EMPLOYEE OWNERSHIP, SAVINGS AND

INVESTMENT TRUST, AND BAHMAN ATEFI

     THIS FIRST AMENDMENT TO THE ALION MEZZANINE WARRANT AGREEMENT (the
“Amendment”) is made effective as of December
15, 2004, between Alion Science
and Technology Corporation, a Delaware corporation (the “Company”), and Bahman
Atefi, an individual (“Holder”).

     WHEREAS, the Company, Holder, and Alion Science and Technology Corporation
Employee Ownership, Savings and Investment Trust (the “Trust”) entered into
that certain Alion Mezzanine Warrant Agreement dated as of the 20th day of
December 2002 (the “Alion Mezzanine Warrant Agreement”), pursuant to which the
Company issued to Holder warrants to purchase Twenty-Two Thousand Sixty-One and
Seven-Tenths (22,061.7) shares of the Company’s $0.01 par value per share
common stock (“Common Stock”);

     WHEREAS, the Company and Holder desire to amend Sections 3(l)(v) and 16(c)
of the Alion Mezzanine Warrant Agreement;

     WHEREAS, the Trust is a party to the Alion Mezzanine Warrant Agreement
only for the purposes of Sections 6, 7, 15 and 17 through 25 of the
Alion Mezzanine Warrant Agreement, and pursuant to Section 18 of the Alion
Mezzanine Warrant Agreement, Sections 3(l)(v) and 16(c) may be amended by the
mutual written agreement of the Company and Holder, without the need to obtain
the Trust’s consent; and

     WHEREAS, the Company and Holder desire to amend the Alion Mezzanine
Warrant Agreement as set forth herein.

     NOW, THEREFORE, in consideration of the premises set forth above and the
respective covenants and agreements contained in this Amendment, and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
mutually acknowledged, and intending to be legally bound, the parties hereto
hereby agree as follows:

     1. Amendments to the Alion Mezzanine Warrant Agreement.

          (a) Section 3(l)(v) of the Alion Mezzanine Warrant Agreement is hereby
amended by deleting the entire text of Section 3(l)(v) and substituting in lieu
thereof:

“interests or rights designated as phantom stock issued or granted
by the Company to employees, consultants, officers or directors of
the Company or any of its Subsidiaries in accordance with a
phantom stock plan to be adopted by the Company’s board of
directors after the Effective Date, except for such amount of
phantom stock that, at the time of issuance or grant, would cause
the aggregate

  First Amendment to the Alion Mezzanine Warrant Agreement

 

 

number of shares of phantom stock then outstanding
(excluding any shares of phantom stock that have (x) expired,
terminated unexercised or become unexercisable, or (y) been
forfeited or otherwise terminated, surrendered or cancelled) to be
in excess of 225,000 shares of phantom stock.”

          (b) Section 16(c) of the Alion Mezzanine Warrant Agreement is hereby
amended by deleting the entire text of Section 16(c) and substituting in lieu
thereof:

“The Company will not issue shares of phantom stock that cause the
number of shares of outstanding phantom stock (excluding any
shares of phantom stock that have expired, terminated unexercised,
or become unexercisable, or that have been forfeited or otherwise
terminated, surrendered or cancelled), at the time of issuance, to
be in excess of 225,000 shares of phantom stock.”

     2. Waiver. Holder hereby irrevocably waives (i) any and all
breaches by the Company of the Company’s covenants set forth in Section 16(c)
of the Alion Mezzanine Warrant Agreement, and (ii) any and all adjustments to
the Exercise Price (as defined in the Alion Mezzanine Warrant Agreement), in
each case based upon or arising out of the issuance by the Company of shares of
phantom stock on or before the effective date of this Amendment, and hereby
fully and forever, effective as of the effective date of this Amendment,
releases, discharges and acquits the Company from any and all claims, demands,
causes of action, and/or damages, which Holder may now or hereafter have or
claim to have against the Company, based in whole or in part upon, or which may
arise from the issuance by the Company of shares of phantom stock on or before
the effective date of this Amendment.

     3. Remainder of the Alion Mezzanine Warrant Agreement Not Affected.
Except as set forth in Section 1 hereof, the terms and provisions of the Alion
Mezzanine Warrant Agreement remain in full force and effect without change,
amendment, waiver or modification.

     4. Ratification. As modified hereby, the Alion Mezzanine Warrant
Agreement and its terms and provisions are hereby ratified for all purposes and
in all respects.

     5. Counterparts. This Amendment may be executed in one or more
counterparts, all of which taken together shall constitute one instrument.

     6. References. From and after the date provided above, all
references to the Alion Mezzanine Warrant Agreement shall be deemed to be
references to the Alion Mezzanine Warrant Agreement as modified hereby.

     7. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard
to the conflict of laws principles thereof.

     8. Conflict. In the event of any conflict between the terms of
this Amendment and the Alion Mezzanine Warrant Agreement, the terms of this
Amendment shall govern.

[Signatures follow on next page]

2

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by its officers thereunto duly authorized as of the date hereof.

Alion Science and Technology Corporation

	 	 	 	 	 
	By:
/s/ Jack Hughes

	 	/s/ Bahman Atefi
	Name: Jack Hughes	 	Bahman Atefi
	Title: Senior Vice President and	 	 
	

	 	  Chief Financial Officer

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