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Exhibit 10.30
WAIVER UNDER AMENDED AND RESTATED LOAN AND
SECURITY AGREEMENT
THIS WAIVER UNDER AMENDED AND RESTATED LOAN AND SECURITY
AGREEMENT (this "Waiver") is entered into as of December 12,
2008, by and among TELOS CORPORATION , a Maryland
corporation ("Parent"), XACTA CORPORATION , a Delaware
corporation ("Xacta"; Parent and Xacta are referred to hereinafter
each individually as a "Borrower", and individually and
collectively, jointly and severally, as the "Borrowers"), TELOS
DELAWARE, INC. , a Delaware corporation ("Telos-Delaware"),
UBIQUITY.COM, INC. , a Delaware corporation ("Ubiquity"),
TELOS INTERNATIONAL CORP. , a Delaware corporation ("TIC"),
TELOS INTERNATIONAL ASIA, INC. , a Delaware corporation
("TIA"), SECURE TRADE, INC. , a Delaware corporation ("STI")
and TELOWORKS, INC. , a Delaware corporation ("Teloworks";
Telos-Delaware, Ubiquity, TIC, TIA, STI and Teloworks are referred
to hereinafter each individually as a "Credit Party" and
collectively, jointly and severally, as the "Credit Parties"), and
WELLS FARGO FOOTHILL, INC. (formerly known as Foothill
Capital Corporation), as agent ("Agent") for the Lenders (defined
below) and as a Lender.
WHEREAS, Borrowers, Credit Parties, Agent and certain other
financial institutions from time to time party thereto (the
"Lenders") are parties to that certain Amended and Restated Loan
and Security Agreement dated as of April 3, 2008, but
effective as of March 31, 2008 (as amended from time to time,
the "Loan Agreement");
WHEREAS, Borrowers, Credit Parties, Agent and Lenders are
parties to that certain Waiver to Amended and Restated Loan and
Security Agreement dated as of August 25, 2008 (the "August
Waiver");
WHEREAS, Borrowers, Credit Parties, Agent and Lenders are
parties to that certain Waiver and First Amendment to Amended and
Restated Loan and Security Agreement dated as of August 26,
2008 (the "First Amendment");
WHEREAS, Borrowers and Credit Parties have notified Agent that
Events of Default exist under (a) Section 8.2 of the Loan
Agreement due to (i) the failure of the Companies to deliver a
Deed of Pledge in favor of Agent regarding the stock of Teloworks
Philippines Inc. (the "Philippines Pledge") by September 17,
2008 as required by Section 8 of the Waiver and First
Amendment to Amended and Restated Loan and Security Agreement dated
as of August 26, 2008 (the "Pledge Default"), (ii) the
failure of the Companies to deliver the 2007 Audit (as defined in
the August Waiver) and a certificate of accountants related thereto
on or before October 31, 2008 as required by the August Waiver
(the "Audit Default"), (iii) the failure of Parent to timely
file with the SEC a Form 12b-25, Notification of Late Filing with
respect to its Form 10-Q for the period ended March 31, 2008
(the "SEC Filing Default") and with respect to its Form 10-Q for
the period ended September 30, 2008 in violation of
Section 6.10 of the Loan Agreement, and (iv) the
execution by Parent of the Subordination Agreement dated as of
May 31, 2008 between Parent and Silicon Valley Bank with
respect to Parent’s right to payments under that certain
Demand Promissory Note dated December 31, 2007 issued by
Enterworks, Inc. in favor of Parent in the face
principal amount of $250,000 in violation of Section 7.4 of
the Loan Agreement (the "Enterworks Note Default")
(b) Section 8.10 of the Loan Agreement due to the
following payments by Telos an account of Indebtedness that has
been contractually subordinated in right of payment to the payment
of the Obligations: (i) the payment of $500,000 on
June 2, 2008 to John C. Porter ("Porter") to pay down the
balance due on the Series B Secured Subordinated Note dated
August 15, 2001 between Telos and Porter (the "Porter Note"),
(ii) the payment of $367,745.92 on July 30, 2008 to
Porter to pay off the outstanding balance due on the Porter Note,
and (iii) the payment of $138,254.08 to Toxford Corporation
("Toxford") to pay down the balance due on the Series B Secured
Subordinated Note dated October 13, 1995 (the "Toxford Note")
between Telos and Toxford (the Events of Default listed in part
(b), collectively, the "Subordinated Note Payment Defaults"), and
(c) Section 8.11 of the Loan Agreement due to
(i) the breach of Section 6(a) of the August Waiver due
to the existence of the SEC Filing Default, the Enterworks Note
Default and the Subordinated Note Payment Defaults as of the date
thereof (the "August Waiver Default"), and (ii) the breach of
Section 9(a) of the First Amendment due to the existence of
the SEC Filing Default, the Enterworks Note Default, the
Subordinated Note Payment Defaults and the August Waiver Default as
of the date thereof (the Events of Defaults listed in parts (a),
(b) and (c) collectively, the "Existing
Defaults");
WHEREAS, Borrowers and Credit Parties have requested that Agent
and Required Lenders waive the Existing Defaults; and
WHEREAS, Agent and Required Lenders are willing to waive the
Existing Defaults on and subject to the terms and conditions set
forth herein; and
NOW THEREFORE, in consideration of the premises and mutual
agreements herein contained, the parties hereto agree as
follows:
1. Defined Terms . Unless otherwise defined herein,
capitalized terms used herein shall have the meanings ascribed to
such terms in the Loan Agreement.
2. Waiver . Subject to the satisfaction of the conditions
set forth in Section 4 hereof, and in reliance upon the
representations and warranties contained herein, Agent and Required
Lenders hereby waive the Existing Defaults, provided that the
waiver of the Pledge Default is conditioned upon the delivery of a
Notice of Borrowing and Letter of Direction executed by Parent
requesting a Borrowing in the aggregate principal amount of $10,200
in connection with the payment of all taxes owed in the Philippines
and other filing costs associated with the Philippines Pledge no
later than December 2, 2008, and provided that the waiver of
the Audit Default is conditioned upon the delivery of the 2007
Audit and a certificate of accountants related thereto on or before
December 31, 2008. This is a limited waiver and shall not be
deemed to constitute a waiver of, or consent to, any other existing
or future breach of the Loan Agreement or any other Loan
Document.
3. Ratification . This Waiver, subject to satisfaction of
the conditions provided below, shall constitute an amendment to the
Loan Agreement and all of the Loan Documents as appropriate to
express the agreements contained herein. Except as specifically
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set forth herein, the Loan Agreement and the Loan
Documents shall remain unchanged and in full force and effect in
accordance with their original terms.
4. Conditions to Effectiveness . This Waiver shall become
effective upon the satisfaction of the following conditions
precedent:
(a) Each party hereto shall have executed and delivered this
Waiver to Agent;
(b) Borrowers shall have delivered to Agent such documents,
agreements and instruments as may be requested or required by Agent
in connection with this Waiver, each in form and content acceptable
to Agent;
(c) No Default or Event of Default other than the Existing
Defaults shall have occurred and be continuing on the date hereof
or as of the date of the effectiveness of this Waiver; and
(d) All proceedings taken in connection with the transactions
contemplated by this Waiver and all documents, instruments and
other legal matters incident thereto shall be sati
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