Document:

Exhibit 10.23

 

AMENDMENT NO. 1

TO SENIOR SECURED CREDIT AGREEMENT

 

 

THIS
AMENDMENT NO. 1 TO SENIOR SECURED CREDIT AGREEMENT (this
“Amendment”) is entered into as of May 7, 2003 by and among THE TITAN
CORPORATION, a Delaware corporation (the “Borrower”), the various
financial institutions from time to time parties hereto (the “Lenders”),
WACHOVIA BANK, NATIONAL ASSOCIATION (“Wachovia”), as administrative
agent (in such capacity, the “Administrative Agent”) for the Lenders,
THE BANK OF NOVA SCOTIA (“Scotiabank”), as a syndication agent (in such
capacity, a “Syndication Agent”), COMERICA BANK-CALIFORNIA (“Comerica”),
as a syndication agent (in such capacity, a “Syndication Agent”), BRANCH
BANKING AND TRUST (“BB&T”), as a documentation agent (in such
capacity, a “Documentation Agent”), and TORONTO DOMINION (NEW YORK),
INC. (“TD”), as a documentation agent (in such capacity, a “Documentation
Agent”).  Capitalized terms used but
not otherwise defined herein shall have the respective meanings given to them
in the Credit Agreement (hereinafter defined), after giving effect to this
Amendment.

 

WITNESSETH

 

WHEREAS,
the Borrower, the Lenders, the Syndication Agents, the Documentation Agents,
and the Administrative Agent are party to that certain Senior Secured Credit
Agreement dated as of May 23, 2002 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”);

 

WHEREAS,
the Borrower has requested that the Lenders agree to amend certain provisions
of the Credit Agreement, and the Lenders are willing to agree to such
amendments upon the terms and conditions contained in this Amendment;

 

NOW,
THEREFORE, in consideration of the premises and the
mutual covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

I.                                         AMENDMENTS
TO CREDIT AGREEMENT

 

1.1                                 Section 1.1
is amended by adding the following definitions in the alphabetically
appropriate places:

 

“Amendment No. 1” means Amendment No.
1 to Senior Secured Credit Agreement, dated as of May 7, 2003, by and among the
Borrower, the Lenders party thereto, the Syndication Agents, the Documentation
Agents and the Administrative Agent.

 

“Amendment No. 1 Effective Date” shall
have the meaning given to such term in Section 3 of Amendment No. 1.

 

 

“New Guarantors” means Afripa, LinCom
Wireless, Titan Africa, Inc., International
Systems, LLC and WaveScience, Inc.

 

“Senior Subordinated Debt” means the
$200,000,000 8.0% Senior Subordinated Notes due 2011 issued by the Borrower,
together with (i) the notes exchanged pursuant to an “Exchange Offer” described
in and issued in accordance with the terms of the Senior Subordinated Debt
Offering Memorandum and the Senior Subordinated Debt Indenture and (ii) all
guarantees of any of the foregoing notes as described in and issued in
accordance with the terms of the Senior Subordinated Debt Offering Memorandum
and the Senior Subordinated Debt Indenture.

 

“Senior Subordinated Debt Offering
Memorandum” means the Confidential Offering Circular dated May 9, 2003 for
the Senior Subordinated Debt.

 

“Senior Subordinated Debt Escrow Account”
means the account into which the Net Proceeds from the Senior Subordinated Debt
shall be escrowed in accordance with the terms of the Senior Subordinated Debt
Indenture.

 

“Senior Subordinated Debt Escrow Period”
means the period of time (not to exceed 40 days from the date of issuance of
the Senior Subordinated Debt) that the Net Proceeds from the Senior
Subordinated Debt shall be held in the Senior Subordinated Debt Escrow Account.

 

“Senior Subordinated Debt Indenture”
means the indenture to be executed in connection with the Senior Subordinated
Debt by and among the Borrower, the subsidiary guarantors party thereto and
Deutsche Bank Trust Company Americas, as trustee, as amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof.

 

1.2                                 Certain definitions in
Section 1.1 are amended as follows:

 

(a)                                  The definition of “Applicable
Margin” in Section 1.1 is amended by deleting the pricing grid
contained therein and replacing it with the following pricing grid:

 

	
  Total Debt to

  	
   

  	
  LIBO Rate
  Loans

  	
   

  	
  Base Rate
  Loans

  	
   

  
	
  EBITDA

  Ratio

  	
   

  	
  Revolving

  Loans

  	
   

  	
  Term B
  Loans

  	
   

  	
  Revolving

  Loans

  	
   

  	
  Term B
  Loans

  	
   

  
	
  > 3.5

  	
   

  	
  2.75

  	
  %

  	
  3.25

  	
  %

  	
  1.50

  	
  %

  	
  2.00

  	
  %

  
	
  > 3.0 but < 3.5

  	
   

  	
  2.50

  	
  %

  	
  3.00

  	
  %

  	
  1.25

  	
  %

  	
  1.75

  	
  %

  
	
  > 2.5 but < 3.0

  	
   

  	
  2.25

  	
  %

  	
  2.75

  	
  %

  	
  1.00

  	
  %

  	
  1.50

  	
  %

  
	
  > 2.0 but < 2.5

  	
   

  	
  2.00

  	
  %

  	
  2.75

  	
  %

  	
  0.75

  	
  %

  	
  1.50

  	
  %

  
	
  < 2.0

  	
   

  	
  2.00

  	
  %

  	
  2.50

  	
  %

  	
  0.75

  	
  %

  	
  1.25

  	
  %

  

 

2

 

(b)                                 The definition of “Applicable
Margin” in Section 1.1 is further amended by adding the following
sentences at the end of such definition:

 

From the Amendment No. 1 Effective Date to
the first Calculation Date thereafter, the Applicable Margins shall be based on
the highest percentages in the above described pricing grid.  After such first Calculation Date, the
Applicable Margin shall be as set forth in the pricing grid.  In the event that the repayment and/or
redemption of the Debentures, the HIGH TIDES and the common securities of the
Titan Capital Trust does not take place on or before the end of the Senior
Subordinated Debt Escrow Period, then automatically on the first day thereafter
the pricing grid contained herein shall revert back to levels in effect prior
to the Amendment No. 1 Effective Date and such prior pricing levels shall be in
full force and effect thereafter.

 

(c)                                  The definition of
“Guarantor” in Section 1.1 is amended in its entirety so that such
definition now reads as follows:

 

“Guarantor” means each direct and
indirect U.S. Subsidiary of the Borrower whether now existing or hereafter
acquired or organized (other than Sakon and Titan Capital Trust), each of which
shall be required to execute and deliver the Subsidiary Guaranty, or a supplement
thereto, to the Administrative Agent.

 

(d)                                 The definition of “Hedging
Agreements” in Section 1.1 is amended by replacing the comma after the
reference to “interest rate collar agreement” with a period and deleting the
remainder of the definition thereafter.

 

(e)                                  The definition of “Restricted
Subsidiaries” is amended in its entirety so that it now reads as follows:

 

“Restricted Subsidiaries” means all
Guarantors and Sakon.

 

(f)                                    Clause (ii) of the
definition of “Subordinated Debt” in Section 1.1 is amended by
adding the following parenthetical clause at the end of such clause:

 

(it being understood and agreed that the
Senior Subordinated Debt shall constitute Subordinated Debt on terms reasonably
satisfactory to the Required Lenders so long as the Senior Subordinated Debt is
issued substantially in accordance with the terms of the Senior Subordinated
Debt Offering Memorandum and the Senior Subordinated Debt Indenture).

 

1.3                                 Section 2.3(b)
of the Credit Agreement is amended by adding the following new clause (iv) at
the end of such section:

 

3

 

(iv)                              Notwithstanding the
foregoing clauses of this Section 2.3(b) to the contrary, Incremental Term
Loans for the purpose of funding the repayment and/or redemption of the
Debentures, the HIGH TIDES and the common securities of Titan Capital Trust (or
refinancing Revolving Loans which are used for such purpose) may be made in a
minimum amount of $1,000,000 and integral multiples of $1,000,000 in excess
thereof (and may be made as Base Rate Loans or LIBO Rate Loans in such minimum
amounts).

 

1.4                                 Section 3.1(d)
of the Credit Agreement is amended by adding the following sentence at the end
of such Section:

 

Notwithstanding the foregoing, if the
Borrower would be required to prepay Senior Subordinated Debt from any portion
of Net Proceeds of an Asset Sale pursuant to the terms of the Senior
Subordinated Debt Indenture and would not otherwise be required to prepay such
proceeds pursuant to the foregoing provisions of this Section 3.1(d), then
the Borrower shall make a mandatory prepayment of the Loans from 100% of such
proceeds, unless otherwise agreed by the Required Lenders.

 

1.5                                 Section 3.1(f)
of the Credit Agreement is amended by adding the following sentence at the end
of such Section:

 

Notwithstanding the foregoing, the Borrower
shall not be required to make a mandatory prepayment of the Loans with Net
Proceeds from the issuance of the Senior Subordinated Debt so long as such Net
Proceeds are used in accordance with the terms of the Senior Subordinated Debt
Offering Memorandum.

 

1.6                                 Section 7.7
of the Credit Agreement is amended as follows:

 

(a)                                  The introductory
paragraph of Section 7.7 is amended by deleting the clause “or real
property described in clause (d) below” from the third line
thereof.

 

(b)                                 The last paragraph of
Section 7.7 is amended in its entirety so that such paragraph now reads as
follows:

 

Notwithstanding the foregoing, in no event
shall Sakon and its Subsidiaries or Titan Capital Trust, or any other Subsidiary
which is not a Restricted Subsidiary, be subject to the provisions of this Section 7.7
or be required to grant any Liens in favor of the Administrative Agent on
behalf of the Secured Parties nor shall the Borrower or any Subsidiary be
required to grant any Lien on any Capital Stock of Titan Capital Trust.

 

1.7                                 Section 7.8
of the Credit Agreement is amended by adding the following sentence at the end
of such Section:

 

4

 

In addition to the foregoing, the Borrower
may use proceeds of Incremental Term Loans and/or Revolving Loans in an
aggregate amount up to $50,000,000 to repay and/or redeem the Debentures, the
HIGH TIDES, and/or the common securities of Titan Capital Trust (or refinancing
Revolving Loans which are used for such purpose in the case of any Incremental
Term Loans) in accordance with the terms of the Senior Subordinated Debt
Offering Memorandum and the Senior Subordinated Debt Indenture (or in the case
of the common securities, in accordance with the indenture for the Debentures
and the Declaration of Trust) (in each case on or before the end of the Senior
Subordinated Debt Escrow Period and only after the amounts held in the Senior
Subordinated Debt Escrow Account have first been applied for such purposes),
and pay any premiums, fees, costs, and expenses in connection therewith.

 

1.8                                 Section 8.3
of the Credit Agreement is amended by (i) deleting the word “and” at the end of
subsection (g) thereof, (ii) deleting the period at the end of subsection (h)
thereof and replacing it with a semi-colon followed by the word “and”, and
(iii) adding a new subsection (i) thereto which shall read as follow:

 

(i) 
Liens on the Senior Subordinated Debt Escrow Account and all funds and
financial assets now or hereafter held therein to secure the repayment of the
Senior Subordinated Debt; provided that any such Liens shall
automatically terminate upon the repayment and/or redemption of the Debentures,
the HIGH TIDES and the common securities of Titan Capital Trust or, in lieu
thereof, upon the redemption in full of the Senior Subordinated Debt.  Notwithstanding anything to the contrary in
any of the Loan Documents, the Administrative Agent and the Lenders shall not
have any security interest in or other Lien on the Senior Subordinated Debt
Escrow Account and the funds and financial assets now or hereafter held
therein.

 

1.9                                 Section 8.4(a)
is amended in its entirety so that such Section now reads as follows:

 

(a)                                  Total Debt to
EBITDA Ratio.  The Borrower will not
permit the Total Debt to EBITDA Ratio as of the last day of any Fiscal Quarter
to be greater than the ratio set forth opposite such date:

 

 

	
  Fiscal Year

  	
   

  	
  March 31

  	
   

  	
  June 30

  	
   

  	
  September 30

  	
   

  	
  December 31

  	
   

  
	
  2003

  	
   

  	
  5.50 to 1.0

  	
   

  	
  5.50 to 1.0

  	
   

  	
  5.25 to 1.0

  	
   

  	
  5.25 to 1.0

  	
   

  
	
  2004

  	
   

  	
  5.25 to 1.0

  	
   

  	
  5.00 to 1.0

  	
   

  	
  5.00 to 1.0

  	
   

  	
  4.75 to 1.0

  	
   

  
	
  2005

  	
   

  	
  4.75 to 1.0

  	
   

  	
  4.50 to 1.0

  	
   

  	
  4.50 to 1.0

  	
   

  	
  4.25 to 1.0

  	
   

  
	
  Thereafter

  	
   

  	
  4.25 to 1.0

  	
   

  	
  4.00 to 1.0

  	
   

  	
  4.00 to 1.0

  	
   

  	
  4.00 to 1.0

  	
   

  

 

1.10                           Section 8.4 is
further amended by adding the following Section 8.4(a-1) immediately after
Section 8.4(a):

 

5

 

(a-1)                        Total Senior Debt to EBITDA
Ratio.  The Borrower will not permit
the Total Senior Debt to EBITDA Ratio as of the last day of any Fiscal Quarter
to be greater than the ratio set forth opposite such date:

 

 

	
  Fiscal Year

  	
   

  	
  March 31

  	
   

  	
  June 30

  	
   

  	
  September 30

  	
   

  	
  December 31

  	
   

  
	
  2003

  	
   

  	
  3.75 to 1.0

  	
   

  	
  3.75 to 1.0

  	
   

  	
  3.75 to 1.0

  	
   

  	
  3.50 to 1.0

  	
   

  
	
  2004

  	
   

  	
  3.50 to 1.0

  	
   

  	
  3.25 to 1.0

  	
   

  	
  3.25 to 1.0

  	
   

  	
  3.00 to 1.0

  	
   

  
	
  2005

  	
   

  	
  3.00 to 1.0

  	
   

  	
  2.75 to 1.0

  	
   

  	
  2.75 to 1.0

  	
   

  	
  2.50 to 1.0

  	
   

  
	
  Thereafter

  	
   

  	
  2.50 to 1.0

  	
   

  	
  2.50 to 1.0

  	
   

  	
  2.50 to 1.0

  	
   

  	
  2.50 to 1.0

  	
   

  

 

1.11                           Section 8.4(e)
is amended in its entirety so that such Section now reads as follows:

 

(e)                                  Any
calculation to determine compliance with clause (a), (a-1), (b),
(c) or (d) of this Section 8.4, to determine the
Applicable Margin or to determine whether a Default has occurred or would occur
as a result of a particular transaction shall (i) be on a pro  forma
basis and calculated on the assumption that any Permitted Acquisitions or other
relevant transaction which occurred during the relevant period were consummated
on the first day of such period and (ii) not include distributions on the HIGH
TIDES as Interest Expense during the Senior Subordinated Debt Escrow Period.  In the event that the repayment and/or
redemption of the Debentures, the HIGH TIDES and the common securities of Titan
Capital Trust does not take place on or before the end of the Senior
Subordinated Debt Escrow Period, then automatically on the first day after the
Senior Subordinated Debt Escrow Period, Section 8.4 (a-1) shall no longer
be of any force and effect and the covenant levels under Section 8.4 (a)
shall revert back to the covenant levels in effect prior to the Amendment No. 1
Effective Date and such prior covenant levels shall thereafter be in full force
and effect.

 

1.12                           Section 8.6 is
amended by (i) deleting the word “and” at the end of subsection (g)
thereof, (ii) deleting the period at the end of subsection (h) thereof and
replacing it with a semi-colon, and (iii) adding new subsections (i) and (j)
thereto which shall read as follows:

 

(i)                                     the Borrower and
Titan Capital Trust, as applicable, may repay and/or redeem the Debentures and
arrange for the redemption of, and redeem, the HIGH TIDES and the common
securities of Titan Capital Trust (in each case on or before the end of the
Senior Subordinated Debt Escrow Period), and pay any premiums, fees, costs, and
expenses in connection with any of the foregoing, subject to the satisfaction
of each of the following conditions:

 

(A) the Borrower shall have delivered a
certificate to the Administrative Agent dated as of the date of Amendment No. 1
demonstrating as of the fiscal quarter ended March 31, 2003 pro forma

 

6

 

covenant compliance with the financial covenants set forth in
Section 8.4 (after giving effect to the issuance of the Senior
Subordinated Debt and the repayment and/or redemption of the Debentures, the
HIGH TIDES and the common securities of Titan Capital Trust and the making of
any Loans in connection therewith);

 

(B) such payment and/or redemption  shall
first be made with Net Proceeds of the Senior Subordinated Debt and then with
(1) proceeds of Incremental Term Loans and/or Revolving Loans  in
an aggregate amount up to $50,000,000 and/or (2) cash generated in the ordinary
course of the Borrower’s business; and

 

(C) no Default shall have occurred and be
continuing or would result therefrom; and

 

(j)                                     in the event that
the repayment and/or redemption of the Debentures, the HIGH TIDES and the
common securities of Titan Capital Trust does not take place on or before the
end of the Senior Subordinated Debt Escrow Period, the Borrower may repay
and/or redeem the Senior Subordinated Debt so long as such repayment and/or
redemption is made with the proceeds of the Senior Subordinated Debt Escrow
Account.

 

1.13                           Section 8.7 is
amended by (i) deleting the word “and” at the end of subsection (v)
thereof, (ii) deleting the period at the end of subsection (vi) thereof
and replacing it with a semi-colon, and (iii) adding new subsections (vii),
(viii) and (ix) thereto which shall read as follows:

 

(vii) 
the Borrower and Titan Capital Trust, as applicable, may repay and/or
redeem the Debentures, arrange for the redemption of, and redeem the HIGH TIDES
and the common securities of Titan Capital Trust (in each case on or before the
end of the Senior Subordinated Debt Escrow Period and first using the amounts
held in the Senior Subordinated Debt Escrow Account for such purposes), and pay
any premiums, fees, costs, and expenses in connection with any of the
foregoing, subject to the satisfaction of the conditions set forth in
Section 8.6 (i);

 

(viii) 
in the event that the repayment and/or redemption of the Debentures, the
HIGH TIDES and the common securities of Titan Capital Trust does not take place
on or before the end of the Senior Subordinated Debt Escrow Period, the
Borrower may repay and/or redeem the Senior Subordinated Debt so long as such
repayment and/or redemption is made with the proceeds of the Senior
Subordinated Debt Escrow Account; and

 

7

 

(ix)  the Borrower may acquire Senior Subordinated Debt
in connection with an “Exchange Offer” for the Senior Subordinated Debt
described in the Senior Subordinated Debt Offering Memorandum.

 

1.14                           Section 8.9 is
amended by (i) deleting the word “and” at the end of subsection (a)
thereof, (ii) deleting the period a the end of subsection (b) thereof and
replacing it with a semi-colon followed by the word “and”, and (iii) adding a
new subsection (c) thereto which shall read as follows:

 

Titan Capital Trust may be dissolved and
liquidated in connection with the redemption of the HIGH TIDES and common
securities of Titan Capital Trust in connection with the issuance of the Senior
Subordinated Debt.

 

1.15                           Section 8.13 is
amended by replacing the last sentence of such Section with the following:

 

The foregoing prohibitions shall not apply to
restrictions contained in this Agreement, any other Loan Document, or the
Senior Subordinated Debt Indenture.

 

1.16                           Section 9.1(m)
is amended by adding the following sentence thereto:

 

The issuance of the Senior Subordinated Debt,
the repayment and/or redemption of the Debentures, HIGH TIDES, or Senior
Subordinated Debt in accordance with Sections 8.6(i) and (j), and the related
dissolution of Titan Capital Trust, and any actions taken by the Borrower and
Titan Capital Trust to effect such issuance, redemption and dissolution shall
not constitute an Event of Default under this Section 9.1(m).

 

1.17                           Section 9.1 is
amended by adding the following subsections at the end of such Section:

 

(o)                                 Event of Default
under Senior Subordinated Debt Indenture. 
Any “Event of Default” as defined in the Senior Subordinated Debt
Indenture occurs.

 

(p)                                 Failure to Redeem
HIGH TIDES.  Neither the redemption
of the HIGH TIDES in accordance with Section 8.6(i) nor the redemption of
the Senior Subordinated Debt in lieu thereof shall have occurred within 40 days
from the date of issuance of the Senior Subordinated Debt.

 

II.                                     AMENDMENT
FEE

 

2.1                                 The
Borrower shall pay by not later than 3:00 p.m. (eastern daylight time) on May
8, 2003 an amendment fee to the Agent for the account of each Lender executing
and delivering

 

8

 

this Amendment by not later than 5:00 p.m. (eastern daylight time) on
May 7, 2003 in an amount equal to 0.25% of such Lender’s Revolving Loan
Commitment and 0.25% of the then outstanding principal balance of the Term Loan
owed to such Lender (hereinafter the “Amendment Fees”).

 

III.                                 CONDITIONS

 

3.1                                 Amendment.  This Amendment shall be and become effective
as of the date hereof (the “Amendment No. 1 Effective Date”) when all of
the following conditions set forth in this Section 3.1 shall have been
satisfied:

 

(a)                                  Executed Amendment.  The Agent shall have received executed
counterparts of this Amendment and the Consent attached hereto (or other
evidence of execution, satisfactory to the Agent), which collectively shall
have been duly executed on behalf of the Borrower, each of the Guarantors and
the Required Lenders, and executed counterparts of the required supplemental
agreements listed in Section 7.7 of the Credit Agreement in connection
with the addition of the New Guarantors.

 

(b)                                 Fees and Expenses.  The Agent shall have received, for the
account of the Lenders, the Amendment Fees described in Section 2.1 hereof
and the Agent shall have received all other fees and expenses owed and due to
the Agent by the Borrower and the Guarantors.

 

(c)                                  Compliance
Certificate.  The Borrower shall
have delivered a certificate to the Administrative Agent dated as of the date
hereof demonstrating as of the fiscal quarter ending March 31, 2003 pro
forma covenant compliance with the financial covenants set forth in
Section 8.4 (after giving effect to the issuance of the Senior
Subordinated Debt and the redemption of the HIGH TIDES and the making of any
Loans in connection therewith), such certificate to be in form and substance
satisfactory to the Administrative Agent.

 

(d)                                 Senior Subordinated
Debt.  The Senior Subordinated Debt
Indenture shall be in form and substance satisfactory to the Administrative
Agent and the Administrative Agent shall have received a certified copy thereof.  The Senior Subordinated Debt shall have been
issued in accordance with the Senior Subordinated Debt Offering Memorandum and
the Senior Subordinated Debt Indenture, without any material amendment or
waiver thereof except as approved by the Agent and an amount sufficient to
redeem the Senior Subordinated Debt (of not less than $200,000,000) in
accordance with the Senior Subordinated Debt Offering Memorandum shall have
been irrevocably deposited into the Senior Subordinated Debt Escrow Account.

 

(e)                                  Board of Directors
Approval.  The Agent shall have
received evidence of appropriate resolutions of the board of directors of the
Borrower and the Guarantors, including the New Guarantors, authorizing the
entering into of the Amendment and the entering into of the supplemental
agreements referred to in Section 7.7 of the Credit Agreement for the New
Guarantors.

 

9

 

(f)                                    Good Standing
Certificates.  The Agent shall have
received certificates of good standing for each of the Borrower and the New
Guarantors in the state of its organization and each other appropriate
jurisdiction.

 

(g)                                 Secretary’s
Certificate.  The Agent shall have
received a certificate of a duly authorized secretary, assistant secretary, or
other senior officer of the Borrower and each New Guarantor dated the Amendment
No. 1 Effective Date, in form and substance satisfactory to the Agent, with
appropriate insertions and attachments.

 

(h)                                 Legal Opinions.  The Agent shall have received (i) an opinion
of counsel to the Borrower and the Guarantors as to, among other matters, valid
corporate existence and authority, legality, validity and binding effect of the
Amendment, the supplemental agreements of the New Guarantors as described in
Section 7.7 of the Credit Agreement, the absence of any violation of law
or regulation or conflict with any material contracts, including the Senior
Subordinated Debt Indenture and (ii) reliance letters addressed to the Agent
and the Lenders entitling each of them to rely on certain of the opinions
delivered in connection with the issuance of the Senior Subordinated Debt.

 

(i)                                     Revised
Schedules to Credit Documents.  The
Agent shall have received such revised schedules to the Loan Documents after
giving effect to this Amendment as the Borrower may deem necessary in order for
the Borrower and its Subsidiaries to make the representations and warranties
set forth in Section 4.1 of this Amendment No. 1.

 

(j)                                     Officer’s
Certificate. The Agent shall have received an officer’s certificate  stating that (i) the representations and
warranties made by the Credit Parties in the Loan Documents are true and
correct in all material respects on and as of the Amendment No. 1 Effective
Date, both before and after giving effect to this Amendment, (ii) there are no
defaults or events of default under the Loan Documents, either before or after
giving effect to this Amendment, and (iii) the capital structure of the
Borrower and its Subsidiaries after giving effect to the issuance of the Senior
Subordinated Debt and the redemption of the HIGH TIDES has not changed from
that previously disclosed to the Agent.

 

(k)                                  Sources and Uses;
Payment Instructions. The Agent shall have received (i) a statement of
sources and uses of funds covering all payments reasonably expected to be made
by the Borrower in connection with the transactions contemplated by the
Amendment and the Senior Subordinated Debt Offering Memorandum to be
consummated on the Amendment No. 1 Effective Date, including any contribution
made to the Borrower or any of its Subsidiaries for the purposes of funding the
Senior Subordinated Debt Escrow Account and/or redeeming the HIGH TIDES and the
Debentures and an itemized estimate of all fees, expenses and other closing
costs; and (ii) payment instructions with respect to each wire transfer to be
made by the Agent on behalf of the Borrower on the Amendment No. 1 Effective
Date setting forth the amount of such transfer, the purpose of such transfer,
the name and number of the account to which such transfer is to be made, the
name and ABA number of the

 

10

 

bank or other financial institution where such account is located and
the name and telephone number of an individual that can be contacted to confirm
receipt of such transfer.

 

(l)                                     Other Items.  The Agent shall have received such other
documents, agreements or information which may be reasonably requested by the
Agent.

 

The Agent on behalf of the Lenders shall
deliver a certificate to the Borrower on the date that all of the conditions
set forth in Section 3.1 have been satisfied (other than the conditions
set forth in Sections 3.1(d), (g), (h) and (j)) stating that all such
conditions have been satisfied, and to the extent received by, and in acceptable
form to, the Agent, attaching forms of final legal opinions and reliance
letters, a secretary’s certificate and an officer’s certificate that, when
delivered and/or released, shall satisfy the conditions set forth in Sections
3.1(g), (h) and (j).

 

3.2                                 Incremental
Term Loan.  The making of the
Incremental Term Loan in the aggregate amount of up to $50,000,000 for the
purpose of financing the redemption of the HIGH TIDES (or refinancing Revolving
Loans which are used for such purpose) shall be subject to the satisfaction of
the following conditions in this Section 3.2:

 

(a)                                  Amendment
Conditions.  Each of the conditions
set forth in Section 3.1 hereof shall have been satisfied and the
Amendment shall be effective.

 

(b)                                 Conditions in
Credit Agreement.  Each of the conditions
set forth in Sections 2.3(b), 5.2 and 5.3 of the Credit Agreement shall have
been satisfied.

 

(c)                                  Redemption of HIGH
TIDES, Etc.  The redemption of the
Debentures, the HIGH TIDES and the common securities of Titan Capital Trust
shall have been completed simultaneously with the making of the Incremental
Term Loan.

 

IV.                                 MISCELLANEOUS

 

4.1                                 Representations
and Warranties.  The Borrower and
each Subsidiary of the Borrower executing the Consent attached to this
Amendment (hereinafter, collectively the “Credit Parties” or individually a
“Credit Party”) hereby represents and warrants that:

 

(a)                                  (i) it has the
requisite power and authority to execute, deliver and perform this Amendment
and the Consent attached hereto, (ii) it is duly authorized to, and has been
authorized by all necessary action, to execute, deliver and perform this
Amendment and the Consent attached hereto, and (iii) this Amendment and the
Consent attached hereto have been duly executed and delivered by the applicable
Credit Parties and constitute such Credit Parties’ legal, valid and binding
obligations, enforceable in accordance with its terms, except as such
enforceability may be subject to (A) bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium or similar laws affecting
creditors’ rights generally and (B) general principles of equity (regardless of
whether such enforceability is considered in a proceeding at law or in equity);

 

11

 

(b)                                 the representations and
warranties contained in the Credit Agreement are on the date hereof, and will
be on and as of the Amendment No. 1 Effective Date, subject to the limitations
set forth therein, true and correct in all material respects as though made on
and as of such dates (or as of the date indicated therein in the case that such
date is other than the date hereof or the Amendment No. 1 Effective Date);

 

(c)                                  no Default or Event
of Default under the Credit Agreement exists on the date hereof or will exist
on and as of the Amendment No. 1 Effective Date, and no Default or Event of
Default will occur as a result of the transactions contemplated hereby; and

 

(d)                                 no consent, approval,
authorization or order of, or filing, registration or qualification with, any
court or governmental authority or third party is required in connection with
the execution, delivery or performance by any Credit Party of this Amendment or
the Consent attached hereto.

 

4.2                                 Ratification
and Reaffirmation.  Each Credit
Party hereby ratifies the Loan Documents to which it is a party and
acknowledges and reaffirms (a) that it is bound by all terms of such Loan
Documents (as amended hereby) applicable to it and (b) that it is responsible
for the observance and full performance of its respective obligations under
such Loan Documents.

 

4.3                                 Post
Effective Date Deliveries.  The
Borrower shall deliver or cause to be delivered to the Administrative Agent
within 20 days of the Amendment No. 1 Effective Date all items required to be
delivered pursuant to Section 7.7 of the Credit Agreement in connection
with the addition of the New Guarantors that were not previously delivered on
or prior to the Amendment No. 1 Effective Date.

 

4.4                                 Instrument
Pursuant to Credit Agreement.  This
Amendment is a Loan Document executed pursuant to the Credit Agreement and
shall (unless otherwise expressly indicated therein) be construed, administered
and applied in accordance with the terms and provisions of the Credit
Agreement.

 

4.5                                 Successors
and Assigns.  This Amendment shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.

 

4.6                                 No
Other Changes.  Except as expressly
modified and amended by this Amendment, the Credit Agreement and all other Loan
Documents shall continue in full force and effect and all the terms, provisions
and conditions of the Loan Documents shall remain unchanged.

 

4.7                                 Counterparts.  This Amendment may be executed in any number
of counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument.  Delivery of executed counterparts of this
Amendment by telecopy shall be effective as an original and shall constitute a
representation that an original shall be delivered.

 

12

 

4.8                                 Severability.  Any provision of this Amendment held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

4.9                                 Governing
Law.  THE VALIDITY, INTERPRETATION
AND ENFORCEMENT OF THIS AMENDMENT NO. 1 SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (without giving effect to the principles of conflicts of
law).  The provisions of the Credit
Agreement regarding jurisdiction, venue, service of process and waiver of jury
trial are hereby incorporated by reference, mutatis mutandis.

 

[remainder of page intentionally left blank]

 

13

 

IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Amendment to be duly executed and delivered by their proper and duly
authorized officer as of the day and year first above written.

 

	
  BORROWER:

  	
  THE TITAN CORPORATION,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ray H. Guillaume

  	
   

  
	
   

  	
  Name:

  	
  Ray H. Guillaume

  
	
   

  	
  Title:

  	
  Director of Corporate Treasury

  
					

 

14

 

	
  AGENTS AND LENDERS:

  	
  WACHOVIA BANK,
  NATIONAL ASSOCIATION,

  
	
   

  	
  f/k/a FIRST UNION
  NATIONAL BANK

  
	
   

  	
  as Administrative Agent and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott Santa Cruz

  	
   

  
	
   

  	
  Name:

  	
  Scott Santa Cruz

  
	
   

  	
  Title:

  	
  Director

  
					

 

15

 

CONSENT

 

This Consent (this “Consent”), dated as of May 7, 2003, is
delivered in connection with Amendment No. 1 to Credit Agreement, dated as of
the date hereof (“Amendment No. 1”), by and among THE TITAN CORPORATION,
a Delaware corporation (the “Borrower”), the various financial
institutions from time to time parties hereto (the “Lenders”), WACHOVIA
BANK, NATIONAL ASSOCIATION (“Wachovia”), as administrative agent (in
such capacity, the “Administrative Agent”) for the Lenders, THE BANK OF
NOVA SCOTIA (“Scotiabank”), as a syndication agent (in such capacity, a
“Syndication Agent”), COMERICA BANK-CALIFORNIA (“Comerica”), as a
syndication agent (in such capacity, a “Syndication Agent”), BRANCH
BANKING AND TRUST (“BB&T”), as a documentation agent (in such
capacity, a “Documentation Agent”), and TORONTO DOMINION (NEW YORK),
INC. (“TD”), as a documentation agent (in such capacity, a “Documentation
Agent”).  Unless otherwise defined,
terms used herein have the meanings provided in the Credit Agreement (as
defined in Amendment No. 1) as amended by Amendment No. 1 (such agreement, as
so amended, being the “Amended Credit Agreement”).

 

Each of the undersigned, as a party to one or more Loan Documents
hereby acknowledges and consents to the execution and delivery of Amendment No.
1, and hereby confirms and agrees that each Loan Document to which it is a
party is, and shall continue to be, in full force and effect, and hereby
ratifies and confirms in all respects its obligations thereunder, except that,
upon the effectiveness of, and on and after the date of, Amendment No. 1, all
references in each such Loan Document to the “Credit Agreement,” “thereunder,”
“thereof” or words of like import referring to the existing Credit Agreement
shall mean the Amended Credit Agreement. 
This Consent may be executed by the parties hereto in counterparts, each
of which shall be deemed to be an original and all of which shall constitute
together but one and the same instrument.

 

	
  GUARANTORS:

  	
  ACS Technologies, Inc.

  
	
   

  	
  Atlantic Aerospace Electronics Corporation

  
	
   

  	
  AverCom Corporation

  
	
   

  	
  BTG Systems Engineering, Inc.

  
	
   

  	
  BTG Technology Resources, Inc.

  
	
   

  	
  BTG Technology Systems, Inc.

  
	
   

  	
  BTG, Inc.

  
	
   

  	
  C&N Enterprises, Inc.

  
	
   

  	
  California Tube Laboratory, Inc.

  
	
   

  	
  Cayenta eUtility Solutions – eMunicipal Solutions Inc.

  
	
   

  	
  Cayenta Operating LLC

  
	
   

  	
  Cayenta, Inc.

  
	
   

  	
  Concept Automation, Inc. of America

  
	
   

  	
  Datacentric Automation Corporation

  
	
   

  	
  DBA Systems, Inc.

  
	
   

  	
  Delfin Systems

  

 

 

	
   

  	
  Delta Construction Management, Inc.

  
	
   

  	
  GlobalNet, Inc.

  
	
   

  	
  GlobalNet International, LLC

  
	
   

  	
  Horizons Services Company, Inc.

  
	
   

  	
  Intermetrics International, Inc.

  
	
   

  	
  Intermetrics Securities, Inc.

  
	
   

  	
  International Systems, LLC

  
	
   

  	
  Jaycor, Inc.

  
	
   

  	
  LinCom Corporation

  
	
   

  	
  LinCom Wireless, Inc.

  
	
   

  	
  Linkabit Wireless, LLC

  
	
   

  	
  MicroLithics Corporation

  
	
   

  	
  Midnight Oil Services, Inc.

  
	
   

  	
  MJR Associates, Inc.

  
	
   

  	
  Nations, Inc.

  
	
   

  	
  Procom Services, Inc.

  
	
   

  	
  Program Support Associates Inc.

  
	
   

  	
  Pulse Engineering, Inc.

  
	
   

  	
  Pulse Sciences, Inc.

  
	
   

  	
  Research Planning, Inc.

  
	
   

  	
  RW Consultants, Inc.

  
	
   

  	
  Sencom Corp.

  
	
   

  	
  STAC, Inc.

  
	
   

  	
  Titan Africa, Inc.

  
	
   

  	
  Titan Wireless Afripa Holding, Inc.

  
	
   

  	
  Titan Scan Technologies Corporation

  
	
   

  	
  Titan Vigil, Inc.

  
	
   

  	
  Titan Wireless, Inc.

  
	
   

  	
  Tomotherapeutics, Inc.

  
	
   

  	
  Unidyne LLC

  
	
   

  	
  UniVision Technologies, Inc.

  
	
   

  	
  VisiCom Laboratories, Inc.

  
	
   

  	
  WaveScience, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  All By:

  	
  /s/ Ray H. Guillaume

  	
   

  
	
   

  	
  Name: 
  Ray H. Guillaume

  
	
   

  	
  Title: Assistant TreasurerExhibit
10.26

 

AMENDMENT
2003-1 TO

THE
TITAN CORPORATION

DEFERRED
COMPENSATION PLAN

 

 

The Chief Executive Officer of the Titan Corporation
hereby adopts the following amendment to the Titan Corporation Deferred
Compensation Plan (the “Plan”):

 

1.     Section 3.7 of the Plan is hereby amended by the addition of the
following sentence at the end thereof effective July 1, 2002:

 

“Notwithstanding
any provision of the Plan to the contrary, the Chief Executive Officer of the
Company shall have the following powers: 
the power to accelerate the vesting of any Participant’s Company
Discretionary Contribution Account, Company Matching Account and/or Company
Profit Sharing Account; and the power to waive the requirement that a
Participant must be employed on the last day of the Plan Year to avoid
forfeiture of the Annual Company Discretionary Contribution Amount, Annual
Company Matching Amount and/or Annual Company Profit Sharing Amount and
attributable earnings for the Plan Year in which the Participant terminates
employment with the Company.”

 

2.     Section 3.10 of the Plan is hereby amended by the addition of
the following paragraph (d) at the end thereof effective January 1, 2002:

 

“(d)
Notwithstanding anything to the contrary contained in this Section 3.10, in the
event of a Participant’s Retirement, Disability or death while employed by an
Employer, a Participant’s Company Discretionary Contribution Account, Company
Matching Account and Company Profit Sharing Account shall immediately become
100% vested (if it is not already vested in accordance with the above vesting
schedules).”

 

3.     Section 3.11(d) of the Plan is hereby amended by the addition of
the following sentence at the end thereof effective January 1, 2003:

 

“Notwithstanding
any provision of the Plan to the contrary, a Participant who did not
participate in either of the Predecessor Plans can allocate a portion of his or
her Account Balance into the Restricted Fixed Rate Fund if the Committee
determines that such Participant shall have that right.”

 

4.     Article IV of the Plan is amended by the addition of the
following Section 4.5 at the end thereof effective April 1, 2003:

 

“4.5
                        Distribution Upon a Change in Control. Notwithstanding any other provision of
the Plan, if there is a Change in Control, all vested Account Balances under
the Plan shall immediately be distributed or commence to be distributed in
accordance with this Section 4.5.  For
purposes of this

 

1

 

Section 4.5, a
Participant’s vested account balance will be determined: (a)  by crediting the Participant with a Year of
Service for the year of employment in which the Change in Control occurs; and
(b) without applying the provision that a Participant must be employed on the
last day of the Plan Year to avoid forfeiture of the Annual Company Matching
Amount and attributable earnings for the Plan Year in which the Participant
terminates employment with the Company. 
If the Participant’s vested Account Balance at the time of the Change in
Control is less than $25,000, payment of his or her vested Account Balance
shall be in a lump sum.  If his or her
vested Account Balance at such time is equal to or greater than that amount,
the vested Account Balance shall be paid pursuant to the Annual Installment
Method of five years.  If the
Participant has made an alternative distribution election pursuant to Section
7.2 of the Plan, such election shall be effective with respect to the
distribution described in this Section 4.5 provided the Participant has filed
the election, in writing on forms prescribed by the Committee for this purpose,
at least thirteen months prior to the effective date of the Change in
Control.  If the Participant remains
employed by the Company after the Change in Control, the Participant can
continue to participate in the Plan under the terms of the Plan then in
effect.”

 

5.     Section 7.2 of the Plan is hereby amended by the addition of the
following sentence at the end thereof effective April 1, 2002:

 

“Notwithstanding
the foregoing, a Participant whose Termination Benefit would otherwise be paid
pursuant to an Annual Installment Method of five years may elect that his or
her Termination Benefit be paid in the form of a single lump sum, provided that
the Participant files a written election with the Committee, on forms
prescribed by the Committee for this purpose, at least thirteen months prior to
his or her Termination of Employment.”

 

6.     Article XI of the Plan is amended by the addition of the
following Section 11.5 at the end thereof effective April 1, 2003:

 

“11.5
                  Committee Power with Respect to Plan
Amendments.  In addition to the power of the Chief
Executive Officer and/or Chief Operating Officer to amend the Plan set forth in
Section 11.2 and subject to Section 11.3, the Committee shall also have the
power to amend or modify the Plan; provided, however, that: (i) no amendment or
modification shall be effective to decrease or restrict the value of a
Participant’s vested Account Balance in existence at the time the amendment or
modification is made, calculated as if the Participant had experienced a
Termination of Employment as of the effective date of the amendment or
modification or, if the amendment or modification occurs after the date upon
which the Participant was eligible to Retire, the Participant had Retired as of
the effective date of the amendment or modification; and (ii) in the event of

 

2

 

any conflict
between any amendment adopted by the Committee pursuant to this Section 11.5
and any amendment adopted by the Chief Executive Officer and/or Chief Operating
Officer pursuant to Section 11.2, the amendment adopted by the Chief Executive
Officer and/or Chief Operating Officer pursuant to Section 11.2 shall take
precedence.”

 

IN WITNESS
WHEREOF, the Chief Executive Officer of the Titan Corporation has caused this
amendment to be executed this 18th day of September 2003.

 

	
   

  	
  The Titan Corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gene W. Ray

  	
   

  
	
   

  	
   

  	
  Chief Executive Officer

  

 

3

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