Document:

Exhibit 10.2

Non-Qualified
Stock Option Agreement

under
the Natrol, Inc.

2006 Stock Option and Incentive Plan

 

	
  Name of Optionee:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  No./Class of Option Shares:

  	
   

  	
   

  	
   

  	
  Shares of Common Stock

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Grant Date:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Expiration Date:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vesting Period:

  	
   

  	
  Years

  	
   

  	
  Vesting Quarterly

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Option Exercise Price/Share:

  	
   

  	
  $

  	
   

  	
   

  

 

Pursuant to the Natrol, Inc. 2006 Stock Option
and Incentive Plan (the “Plan”), Natrol, Inc., a Delaware corporation
(together with all successors thereto, the “Company”), hereby grants to the
person named above (the “Optionee”), who is a                     
of the Company or any of its subsidiaries, an option (the “Stock
Option”) to purchase on or prior to the expiration date specified above, or
such earlier date as is specified herein, all or any part of the number of
shares of Common Stock, par value $0.01 per share (“Common Stock”), of the
Company indicated above (the “Option Shares”), at the per share option exercise
price specified above, subject to the terms and conditions set forth in this
Non-Qualified Stock Option Agreement (the “Agreement”) and in the Plan. This
Stock Option is not intended to qualify as an “incentive stock option” as
defined in Section 422(b) of the Internal Revenue Code of 1986, as
amended from time to time (the “Code”). All capitalized terms used herein and
not otherwise defined shall have the respective meanings set forth in the Plan.

1. Vesting and Exercisability

(a) No portion of
this Stock Option may be exercised until such portion shall have vested.

(b) Except as set
forth below and in Section 6, and subject to the determination of the
Compensation Committee of the Board of Directors of the Company or the Board of
Directors of the Company, as applicable (the “Committee”), in its sole
discretion to accelerate the vesting schedule hereunder, this Stock Option
shall be vested and exercisable with respect to the following number of Option
Shares on the respective dates indicated:

 1
 

 

 

	
  

  	
  Incremental/Aggregate
  Number 

  of Option Shares Exercisable*

  	
   

  	
  Vesting
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  *Subject to Section 5

  	
   

  	
   

  	
   

  	
   

  
						

 

Notwithstanding the foregoing, as of the effective date of any Sale
Event (as defined in Section 6) 50% of all unvested Options which are not
vested as of the effective date of such Sale Event (or 100% in the case of
Options held by non-employee Directors) shall become vested as of such
effective date, except as the Company may otherwise specify.

(c) In
the event that the Optionee’s service as a                         of the
Company or any of its subsidiaries ceases for any reason or under any
circumstances, including the Optionee’s resignation, retirement or removal by
the Company, upon the Optionee’s death or disability, or for any other reason,
regardless of the circumstances thereof, this Stock Option shall no longer vest
or become exercisable with respect to any Option Shares not vested (or which do
not vest) as of the effective date of such cessation of service, and this Stock
Option may thereafter be exercised, to the extent it was vested and exercisable
on such effective date of such cessation of service, until the Expiration Date
contemplated by Section 1(d), except as the Committee may otherwise
determine.

(d) Once
any portion of this Stock Option becomes vested and exercisable, it shall
continue to be exercisable by the Optionee or his or her successors as
contemplated herein at any time or times prior to the earlier of:

(i) the
date which is twelve months following the date on which the Optionee’s service
as a                     of the
Company or any of its subsidiaries ceases due to death or disability (as
defined in Section 422(c)(6) of the Code) or for 90 days following
the date on which the Optionee’s service as a                       of the
Company or any of its subsidiaries ceases due to any other reason; or

(ii)                       , subject
to the provisions hereof, including, without limitation, Section 6 hereof
which provides for the termination of unexercised options upon completion of
certain transactions as described therein (the earliest to occur of such dates
being referred to as the “Expiration Date”).

(e) It
is understood and intended that this Stock Option shall not qualify as an “incentive
stock option” as defined in Section 422 of the Code.

 2
 

 

 

2. Exercise of  Stock
Option

(a) The Optionee may exercise only vested
portions of this Stock Option and only in the following manner: Prior to the
Expiration Date (subject to Section 6), the Optionee may deliver a Stock
Option Exercise Notice (an “Exercise Notice”) in the form of Appendix A
hereto indicating his or her election to purchase some or all of the Option
Shares with respect to which this Stock Option has vested at the time of such
notice. Such notice shall specify the number of Option Shares to be purchased.

Payment of the purchase
price for the Option Shares may be made by one or more (if applicable) of the
following methods:

(i) in cash, by
certified or bank check or other instrument acceptable to the Committee;

(ii) through the
delivery (or attestation to ownership) of shares of Common Stock that have been
purchased by the Optionee on the open market or that are beneficially owned by
the Optionee and are not then subject to restrictions under any plan of the
Company;

(iii) by the
Optionee delivering to the Company a properly executed Exercise Notice together
with irrevocable instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company to pay the option
purchase price, provided that in the event the Optionee chooses to pay the
option purchase price as so provided, the Optionee and the broker shall comply
with such procedures and enter into such agreements of indemnity and other
agreements as the Committee shall prescribe as a condition of such payment
procedure; or

(iv) a combination
of (i), (ii) and (iii) above.

Payment
instruments will be received subject to collection.

(b) Certificates for
the Option Shares so purchased will be issued and delivered to the Optionee
upon compliance to the satisfaction of the Committee with all requirements
under applicable laws or regulations in connection with such issuance. Until
the Optionee shall have complied with the requirements hereof and of the Plan,
the Company shall be under no obligation to issue the Option Shares subject to
this Stock Option, and the determination of the Committee as to such compliance
shall be final and binding on the Optionee. The Optionee shall not be deemed to
be the holder of, or to have any of the rights of a holder with respect to, any
shares of stock subject to this Stock Option unless and until this Stock Option
shall have been exercised pursuant to the terms hereof, the Company shall have
issued and delivered the Option Shares to the Optionee, and the Optionee’s name
shall have been entered 

 3
 

 

 

as a stockholder of
record on the books of the Company. Thereupon, the Optionee shall have full
dividend and other ownership rights with respect to such Option Shares, subject
to the terms of this Agreement.

(c) Notwithstanding
any other provision hereof or of the Plan, no portion of this Stock Option
shall be exercisable after the Expiration Date, including such date as is
contemplated by Section 6 hereof.

3. Incorporation of Plan

Notwithstanding anything herein to the contrary, this
Stock Option shall be subject to and governed by all the terms and conditions
of the Plan.

4. Transferability

This Agreement is personal to the Optionee and is not
transferable by the Optionee in any manner other than by will or by the laws of
descent and distribution. This Stock Option may be exercised during the
Optionee’s lifetime only by the Optionee (or by the Optionee’s guardian or
legal representative in the event of the Optionee’s incapacity). The Optionee
may elect to designate a beneficiary by providing written notice of the name of
such beneficiary to the Company, and may revoke or change such designation at
any time by filing written notice of revocation or change with the Company;
such beneficiary may exercise the Optionee’s Stock Option in the event of the
Optionee’s death to the extent provided herein. If the Optionee does not
designate a beneficiary, or if the designated beneficiary predeceases the
Optionee, the legal representative of the Optionee may exercise this Stock
Option to the extent provided herein in the event of the Optionee’s death.

5. Adjustment Upon Changes in Capitalization

The shares of stock covered by this Stock Option are
shares of Common Stock of the Company. Subject to Section 6 hereof, if the
shares of Common Stock as a whole are increased, decreased, changed or
converted into or exchanged for a different number or kind of shares or
securities of the Company or any successor entity (or a parent or subsidiary
thereof), whether through merger or consolidation, sale of all or substantially
all of the assets of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, combination of shares, exchange
of shares, change in corporate structure or the like, an appropriate and proportionate
adjustment shall be made in the number and kind of shares and in the per share
exercise price of shares subject to any unexercised portion of this Stock
Option. In the event of any such adjustment in this Stock Option, the Optionee
thereafter shall have the right, subject to Section 6, to purchase the
number of shares under this Stock Option at the per share price, as so
adjusted, which the Optionee could purchase at the total purchase price
applicable to this Stock Option immediately prior to such adjustment, all
references herein to Common Stock shall be deemed to refer to the security that
is subject to acquisition upon exercise of this Stock Option and all references
to the Company shall be deemed to refer to the issuer of such security. Adjustments
under this Section 5 shall be 

 4
 

 

 

determined
by the Committee, whose determination as to what adjustment shall be made, and
the extent thereof, shall be conclusive. No fractional shares of Common Stock
shall be issued under the Plan resulting from any such adjustment, but the
Company in its discretion may make cash payment in lieu of fractional shares.

6. Effect of Certain Transactions

Subject to Section 1(d) hereof, in the case
of (a) the dissolution or liquidation of the Company, (b) the sale of
all or substantially all of the assets of the Company on a consolidated basis
to an unrelated person or entity, (c) a merger, reorganization or
consolidation in which the holders of the Company’s outstanding voting power
immediately prior to such transaction do not own a majority of the outstanding
voting power of the surviving or resulting entity immediately upon completion
of such transaction, (d) the sale of all of the outstanding stock of the
Company to an unrelated person or entity or (e) any other transaction
where the owners of the Company’s outstanding voting power prior to such
transaction do not own at least a majority of the outstanding voting power of
the relevant entity after the transaction (in each case, a “Sale Event”), this
Stock Option shall terminate on the effective date of such transaction or
event, unless provision is made in such transaction in the sole discretion of
the parties thereto for the assumption or continuation by the Company of this
Stock Option or the substitution for this Stock Option of a new stock option of
the successor person or entity or a parent or subsidiary thereof, with
appropriate adjustment as to the number and kind of shares and the per share
exercise price, as provided in Section 5 of this Agreement. In the event
of any transaction which will result in such termination, the Company shall
give to the Optionee written notice thereof at least fifteen (15) days prior to
the effective date of such transaction. Until such effective date, the Optionee
may exercise any portion of this Stock Option which is or becomes vested as of
such effective date (as contemplated by Section 1(b)), but after such
effective date, the Optionee may not exercise this Stock Option unless it is
assumed or substituted by the successor entity (or a parent or subsidiary
thereof) as provided above.

7. Withholding Taxes

The Optionee shall, not later than the date as of
which the exercise of this Stock Option becomes a taxable event for federal
income tax purposes, pay to the Company or make arrangements satisfactory to
the Committee for payment of any federal, state and local taxes required by law
to be withheld on account of such taxable event. Subject to approval by the
Committee, the Optionee may elect to have such tax withholding obligation
satisfied, in whole or in part, by authorizing the Company to withhold from
shares of Common Stock to be issued or transferring to the Company, a number of
shares of Common Stock with an aggregate Fair Market Value that would satisfy
the withholding amount due. For purposes of this Section 7 “Fair Market Value” on any given date
means the last reported sale price at which Common Stock is traded on such date
or, if no Common Stock is traded on such date, the next preceding date on which
Common Stock was traded, as reflected on the principal stock exchange or, if
applicable, any other national stock exchange on which the Common Stock is
traded or admitted to trading. The Optionee acknowledges and agrees 

 5
 

 

 

that
the Company or any subsidiary of the Company has the right to deduct from
payments of any kind otherwise due to the Optionee, or from the Option Shares
to be issued in respect of an exercise of this Stock Option, any federal, state
or local taxes of any kind required by law to be withheld with respect to the
issuance of Option Shares to the Optionee.

8.
Miscellaneous Provisions

(a) Equitable Relief.
The parties hereto agree and declare that legal remedies may be inadequate to
enforce the provisions of this Agreement and that equitable relief, including
specific performance and injunctive relief, may be used to enforce the
provisions of this Agreement.

(b) Change and
Modifications. This Agreement may not be orally changed, modified or
terminated, nor shall any oral waiver of any of its terms be effective. This
Agreement may be changed, modified or terminated only by an agreement in
writing signed by the Company and the Optionee.

(c) Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
State of Delaware.

(d) Headings. The headings
are intended only for convenience in finding the subject matter and do not
constitute part of the text of this Agreement and shall not be considered in
the interpretation of this Agreement.

(e) Saving Clause. If
any provision(s) of this Agreement shall be determined to be illegal or
unenforceable, such determination shall in no manner affect the legality or
enforceability of any other provision hereof.

(f) Notices. All
notices, requests, consents and other communications shall be in writing and be
deemed given when delivered personally, by telex or facsimile transmission or
when received if mailed by first class registered or certified mail, postage
prepaid. Notices to the Company or the Optionee shall be addressed as set forth
underneath their signatures below, or to such other address or addresses as may
have been furnished by such party in writing to the other.

(g) Benefit and
Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto, their respective successors, permitted assigns,
and legal representatives. The Company has the right to assign this Agreement,
and such assignee shall become entitled to all the rights of the Company
hereunder to the extent of such assignment.

 6
 

 

 

(h) Counterparts. For
the convenience of the parties and to facilitate execution, this Agreement may
be executed in two or more counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same document.

 7
 

 

 

The foregoing
Agreement is hereby accepted and the terms and conditions thereof hereby agreed
to by the undersigned.

	
  Dated: 

  	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NATROL, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  	
  Natrol, Inc.

  
	
   

  	
   

  	
   

  	
  Attention:

  
	
   

  	
   

  	
   

  	
  21411 Prairie Street

  
	
   

  	
   

  	
   

  	
  Chatsworth, CA 91311

  
									

 

The foregoing
Agreement is hereby accepted and the terms and conditions thereof hereby agreed
to by the undersigned.

	
  Dated: 

  	
   

  	
   

  	
   

  	
  OPTIONEE:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OPTIONEE’S ADDRESS:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 8
 

 

 

SPOUSE’S
CONSENT

I acknowledge that
I have read the foregoing Non-Qualified Stock Option Agreement and understand
the contents thereof.

	
  

  	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print Name of Spouse

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  DESIGNATED BENEFICIARY:

  	
   

  
	
   

  	
   

  	
   

   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BENEFICIARY’S ADDRESS:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 9
 

 

 

Appendix A

STOCK OPTION EXERCISE NOTICE

Natrol, Inc.

Attention: Chief
Financial Officer

21411 Prairie Street

Chatsworth,
CA 91311

Dear
Sir:

Pursuant to the terms of
my stock option agreement dated                           
(the “Agreement”) under the Natrol, Inc. 2006 Stock Option and Incentive
Plan, I, [Insert Name]                             ,
hereby [Circle One]
partially/fully exercise such option by including herein payment in the amount
of $           representing
the purchase price for [Fill in number of
Option Shares]              
option shares. I have chosen the following form(s) of payment:

o            1.             Cash

o            2.             [Certified
or Bank] Check payable to Natrol, Inc.

o                                    3.             Other (as described in the
Agreement (please describe))                   .

	
   

  	
   

  	
  Sincerely yours,

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Print Name

  	
   

  
					

 

 10Exhibit
10.1(a)

 

FIRST AMENDMENT TO

CREDIT AGREEMENT

 

THIS FIRST
AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of June 30,
2006 (the “Effective Date”), is entered into by and among, (i) EVOLVING
SYSTEMS, INC. (“Evolving Systems”), a Delaware corporation and TELECOM SOFTWARE
ENTERPRISES, LLC, a Colorado limited liability company (together
with Evolving Systems, “Borrowers”
and each, a “Borrower”); (ii) EVOLVING SYSTEMS HOLDINGS, INC., a Delaware corporation (“Intermediate Holdco”), as a Guarantor and additional
Credit Party; (iii) CAPITALSOURCE FINANCE LLC,
a Delaware limited liability company (in its individual capacity, “CapitalSource”), as administrative
and payment agent for the Lenders (CapitalSource, in such capacity, “Agent”); and (iv) the LENDERS identified on the signature pages hereto. Capitalized
terms used and not otherwise defined herein are used as defined in the
Agreement (as defined below).

 

WHEREAS, the Agent, Lenders and Credit Parties have entered into that
certain Credit Agreement dated as of November 14, 2005 (as further amended,
supplemented, modified or restated from time to time, the “Agreement”);

 

WHEREAS, the Credit Parties have requested that Agent and Lenders amend
certain provisions of the Agreement and Agent and the Lenders are willing to do
so subject to the satisfaction of the conditions set forth herein;

 

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

 

SECTION 1. Amendment.  The
following sections of the Agreement are amended as follows:

 

1.1           Item 2 set forth on
Exhibit B-1. Item 2 set forth on Exhibit B-1 of the Agreement is hereby
amended to read in full as follows:

 

“2.           Minimum EBITDA. No Credit Party shall
permit EBITDA of the Credit Parties and their consolidated Subsidiaries on a
consolidated basis, without duplication, for the twelve (12) month period
ending on any date set forth in the table below to be less than the minimum
amount set forth in the table below opposite such date:

 

1

 

	
  Date

  	
   

  	
  Minimum EBITDA

  	
   

  
	
  June 30, 2006

  	
   

  	
  $

  	
  4,500,000

  	
   

  
	
  September 30, 2006 and December 31, 2006

  	
   

  	
  $

  	
  4,325,000

  	
   

  
	
  March 31, 2007

  	
   

  	
  $

  	
  4,500,000

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  4,850,000

  	
   

  
	
  September 30, 2007

  	
   

  	
  $

  	
  5,000,000

  	
   

  
	
  December 31, 2007, March 31, 2008, and June
  30, 2008

  	
   

  	
  $

  	
  5,200,000

  	
   

  
	
  September 30, 2008 and the end of each
  quarter thereafter

  	
   

  	
  $

  	
  5,400,000

  	
  ”

  

 

1.2           Item
3 set forth on Exhibit B-1. Item 3 set forth on Exhibit B-1 of the
Agreement is hereby amended to read in full as follows:

 

“3.           Fixed Charge Coverage Ratio. No Credit
Party shall permit the Fixed Charge Coverage Ratio for the Applicable Period
ending on the last date of each fiscal quarter to be less than 1.15 to 1.00.”

 

1.3           Item 5 set forth on
Exhibit B-1. The following new definition shall be added to Item 5 set forth on
Exhibit B-1 of the Agreement in the appropriate alphabetical order:

 

“Applicable Period” shall
mean (i) for the fiscal quarter ending on June 30, 2006, the nine (9) month
period then ending, and (ii) for each fiscal quarter ending thereafter, the
twelve (12) month period.”

 

1.4           Item 5 set forth on
Exhibit B-1. The definition of “Fixed Charge Coverage Ratio” is hereby amended to read
in full as follows:

 

“Fixed Charge Coverage Ratio”
shall mean, for the Credit Parties and their consolidated Subsidiaries on a
consolidated basis and without duplication, on any date of determination, the
ratio of (a) EBITDA minus Unfinanced Capital Expenditures minus
income and franchise taxes paid in cash, to (b) Fixed Charges, in each case for
the Applicable Period.”

 

1.5           Item 5 set forth on
Exhibit B-1. The definition of “Total Debt Service” is hereby amended to read in
full as follows:

 

“Total Debt Service” shall
mean, for any period, the sum for Credit Parties and
their consolidated Subsidiaries on a consolidated basis amounts of (a)
scheduled payments of principal on any and all Total Debt during such period,
(b) other required payments of principal on Total Debt other than the
Obligations, (c) any other cash 

 

2

 

amounts due or payable
with respect to, in connection with or on Total Debt during such period
(excluding (i) any mandatory prepayments of the Obligations and (ii) the partial prepayment of
principal of the Loan by the Credit Parties pursuant to Section 2.4 of the
Agreement in an amount equal to One Million Dollars ($1,000,000) made in
connection with this Amendment), and (d) Interest Expense paid
in cash or required to be paid in cash during such period.”

 

1.6           Item 1 set forth on
Schedule 6.7. Item 1 set forth on Schedule 6.7 of the Agreement is hereby amended to
read in full as follows:

 

“1.           On or before July 31,
2006, Evolving Systems and its Subsidiaries shall execute the Transfer Pricing
Agreements in form and substance approved by Agent in its Permitted Discretion
and deliver copies thereof to Agent.”

 

SECTION 2. Conditions.  This
Amendment and the amendments contained herein shall be subject to satisfaction
of the following conditions precedent: (a) the representations and warranties
contained herein and in all other Loan Documents shall be true and correct in
all material respects as of the Effective Date as if then made, except for such
representations and warranties limited by their terms to a specific date; (b)
no Default or Event of Default shall be in existence after giving effect to
this Amendment; (c) the Credit Parties shall have delivered to Agent an
executed copy of this Amendment and each other agreement, document or
instrument reasonably requested by the Agent in connection with this Amendment;
(d) Agent and the Requisite Lenders shall have consented in writing to all of
the provisions and amendments contained in this Amendment, in form and
substance satisfactory to Agent; (e) the Credit Parties shall have made a
partial prepayment of principal of the Loan pursuant to Section 2.4 of the
Agreement in an amount equal to One Million Dollars ($1,000,000), together with
the applicable Prepayment Premium of Twenty-Five Thousand Dollars ($25,000) and
any accrued interest applicable to such prepayment; (f) a fully executed
amendment to the Revolving Loan Agreement satisfactory to Agent; and (g) all
proceedings taken in connection with the transactions contemplated by this
Amendment and all documentation and other legal matters incident thereto shall
be satisfactory to Agent. The Credit Parties agree further that the failure by
the Credit Parties to comply with this Section 2 shall be an Event of
Default.

 

SECTION 3. Agreement in Full Force
and Effect as Amended.  Except as
specifically amended hereby, the Agreement and other Loan Documents shall
remain in full force and effect and are hereby ratified and confirmed as so
amended. Except as expressly set forth herein, this Amendment shall not be
deemed to be a waiver, amendment or modification of any provisions of the
Agreement or any other Loan Document or any right, power or remedy of Agent or
Lenders, nor constitute a waiver of any provision of the Agreement or any other
Loan Document, or any other document, instrument or agreement executed or
delivered in connection therewith or of any Default or Event of Default under
any of the foregoing, in each case whether arising before or after the Effective
Date or as a result of performance hereunder or thereunder. This Amendment also
shall not preclude the future exercise of any right, remedy, power, or
privilege available to Agent or Lenders whether under the Agreement, the other
Loan 

 

3

 

Documents, at law or otherwise. All references to the Agreement shall
be deemed to mean the Agreement as modified hereby. This Amendment shall not
constitute a novation or satisfaction and accord of the Agreement or other Loan
Documents, but shall constitute an amendment thereof. The parties hereto agree
to be bound by the terms and conditions of the Agreement and Loan Documents as
amended by this Amendment, as though such terms and conditions were set forth
herein. Each reference in the Agreement to “this Agreement,” “hereunder,” “hereof,”
“herein” or words of similar import shall mean and be a reference to the
Agreement as amended by this Amendment, and each reference herein or in any
other Loan Document to the “Agreement” or “Credit Agreement” shall mean and be
a reference to the Agreement as amended and modified by this Amendment.

 

SECTION 4. Representations.
 Each Credit Party hereby represents and warrants to Agent and Lenders as
of the Effective Date as follows:  (a) it
is duly incorporated or organized, validly existing and in good standing under
the laws of its jurisdiction of organization; (b) the execution, delivery
and performance by it of this Amendment and all other Loan Documents executed
or delivered in connection herewith are within its powers, have been duly
authorized, and do not contravene (i) its articles of organization, operating
agreement, or other organizational documents, or (ii) any applicable law; (c)
no consent, license, permit, approval or authorization of, or registration,
filing or declaration with any Governmental Authority or other Person, is
required in connection with the execution, delivery, performance, validity or
enforceability of this Amendment or any other Loan Documents executed or
delivered in connection herewith by or against it; (d) this Amendment and all
other Loan Documents executed or delivered in connection herewith have been
duly executed and delivered by it; (e) this Amendment and all other Loan
Documents executed or delivered in connection herewith constitute its legal,
valid and binding obligation enforceable against it in accordance with their
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors’ rights generally or by general principles of equity;
(f) after giving effect to this Amendment, it is not in default under the
Loan Documents and no Default or Event of Default exists, has occurred and is
continuing or would result by the execution, delivery or performance of this
Amendment; and (g) the representations and warranties contained herein and in
all other Loan Documents are true and correct in all material respects as of
the Effective Date as if then made, except for such representations and
warranties limited by their terms to a specific date.

 

SECTION 5. Miscellaneous.

 

5.1          This
Amendment may be executed in any number of counterparts (including by facsimile
or electronic PDF version), and by the different parties hereto on the same or
separate counterparts, each of which shall be deemed to be an original
instrument but all of which together shall constitute one and the same
agreement. Each party agrees that it will be bound by its own facsimile
signature or electronic PDF signature and that it accepts the facsimile or
electronic PDF signature of each other party. The descriptive headings of the
various sections of this Amendment are inserted for 

 

4

 

convenience of
reference only and shall not be deemed to affect the meaning or construction of
any of the provisions hereof or thereof. Whenever the context and construction
so require, all words herein in the singular number herein shall be deemed to
have been used in the plural, and vice versa, and the masculine gender shall
include the feminine and neuter and the neuter shall include the masculine and
feminine.

 

5.2          This
Amendment may not be changed, amended, restated, waived, supplemented,
discharged, canceled, terminated or otherwise modified orally or by any course
of dealing or in any manner other than as provided in the Agreement. This
Amendment shall be considered part of the Agreement and shall be a Loan
Document for all purposes under the Agreement and other Loan Documents.

 

5.3          This
Amendment, the Agreement and the Loan Documents constitute the final, entire
agreement and understanding between the parties with respect to the subject
matter hereof and thereof and may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements between the parties, and shall be
binding upon and inure to the benefit of the successors and assigns of the
parties hereto and thereto. There are no unwritten oral agreements between the
parties with respect to the subject matter hereof and thereof.

 

5.4          THIS
AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE
CHOICE OF LAW PROVISIONS SET FORTH IN THE AGREEMENT AND SHALL BE SUBJECT TO THE
WAIVER OF JURY TRIAL AND NOTICE PROVISIONS OF THE AGREEMENT.

 

5.5          No Credit Party may assign, delegate or transfer
this Amendment or any of its rights or obligations hereunder except as provided
in the Agreement. No rights are intended to be created under this Amendment for
the benefit of any third party donee, creditor or incidental beneficiary of any
Credit Party. Nothing contained in this Amendment shall be construed as a
delegation to Agent or Lenders of any Credit Party’s duty of performance,
including, without limitation, any duties under any account or contract in
which Agent or Lenders have a security interest or Lien. This Amendment shall
be binding upon the Credit Parties and their respective successors and assigns.
This Amendment shall be binding upon and inure to the benefit of each Lender,
Agent, each Transferee, each Participant (to the extent expressly provided in
the Agreement only) and all future holders of the Loan, the Notes, the
Obligations and/or any of the Collateral, and each of their respective
successors and assigns.

 

5.6          The
Credit Parties, jointly and severally, shall pay all reasonable costs and
expenses incurred by Agent, Lenders and their Affiliates, including, without
limitation, documentation and diligence fees and expenses, all search, audit,
appraisal, recording, professional and filing fees and expenses and all other
out-of-pocket charges and expenses (including, without limitation, UCC and
judgment and tax lien searches and UCC filings and fees for post-Closing UCC
and judgment and tax lien searches) and reasonable attorneys’ fees and
expenses, in connection with entering into, negotiating,

 

5

 

preparing, reviewing and executing this Amendment and the documents,
agreements and instruments contemplated hereby and all related agreements,
documents and instruments. All of the foregoing shall be charged to Credit
Parties’ account and shall be part of the Obligations. If Agent, any Lender or
any of their Affiliates uses in-house counsel for any of the purposes set forth
above, the Credit Parties expressly agree that their Obligations include
reasonable charges for such work commensurate with the reasonable fees that
would otherwise be charged by outside legal counsel selected by such Person in
its sole discretion for the work performed.

 

5.7          Each
Credit Party hereby: (a) consents to the execution and delivery of this
Amendment by the other Credit Parties; (b) agrees that this Amendment shall not
limit or diminish the obligations of the subject Credit Party under the Loan
Documents; (c) reaffirms its obligations under each of the Loan Documents to
which it is a party; and (d) agrees that each of such Loan Documents remains in
full force and effect and is hereby ratified and confirmed.

 

5.8          All
representations and warranties made in this Amendment shall survive the
execution and delivery of this Amendment and no investigation by Agent or
Lenders shall affect such representations or warranties or the right of Agent
or Lenders to rely upon them.

 

[SIGNATURES APPEAR ON FOLLOWING PAGES]

 

6

 

IN WITNESS WHEREOF, the parties have caused this First Amendment to
Credit Agreement to be executed by their respective officers thereunto duly
authorized, as of the Effective Date.

 

	
  BORROWER:

  	
  EVOLVING
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Brian R. Ervine

  
	
   

  	
  Title:

  	
  Executive
  Vice President and Chief

  
	
   

  	
   

  	
  Financial
  and Administrative Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  BORROWER:

  	
  TELECOM
  SOFTWARE

  ENTERPRISES, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Brian R. Ervine

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  GUARANTOR:

  	
  EVOLVING
  SYSTEMS HOLDINGS,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Brian R. Ervine

  
	
   

  	
  Title:

  	
  Executive
  Vice President and Chief

  
	
   

  	
   

  	
  Financial
  Officer

  
					

 

7

 

	
  AGENT
  AND A LENDER:

  	
  CAPITALSOURCE
  FINANCE LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]