Exhibit 10.27
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this
"First Amendment") is dated as of this 6th day of March, 2002, by and between
COMDIAL CORPORATION (the "Company"), a Delaware corporation with an office at
000 Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxx 00000 and BANK OF AMERICA, N.A. (the
"Bank"), a national banking association with an office at 000 X. Xxxxx Xxxxxx,
Xxxxx 0000, Xxxxx, Xxxxxxx 00000.
The Company and the Bank are parties to an Amended and Restated
Credit Agreement dated as of November 22, 2000 (the "Credit Agreement"),
pursuant to which the Bank agreed, subject to the terms and conditions contained
in the Credit Agreement, to extend a revolving credit facility in the initial
aggregate principal amount not to exceed at any time outstanding $21,500,000, to
provide for a $5,000,000 letter of credit subfacility and to extend an
$18,500,000 term loan facility. The Company and the Bank are also parties to a
letter agreement dated April 10, 2001 (the "April 10 Letter"), pursuant to which
the Bank agreed to modify certain terms of the Credit Agreement as provided
therein. The Company, the Guarantors (as defined in the Credit Agreement) and
the Bank are also parties to a Forbearance Agreement dated as of January 28,
2002 (the "Forbearance Agreement"), pursuant to which the Bank agreed to forbear
from the exercise of certain of its rights and remedies under the Loan Documents
(as defined in the Credit Agreement) for a period of time as specified therein
so that the Company and the Bank could discuss the possibility of restructuring
the Indebtedness (as defined in the Forbearance Agreement).
The Bank and the Company have agreed to restructure the Indebtedness
so as to (i) exchange $10,000,000 of the Indebtedness for preferred stock of the
Company to be issued to the Bank pursuant to this First Amendment and the
Comdial Corporation Certificate of Designation of Series B Alternate Rate
Cumulative Convertible Redeemable Preferred Stock dated March 6, 2002 (the
"Certificate of Designation"), the Registration Rights Agreement dated March 6,
2002, by and between the Company and the Bank (the "Registration Rights
Agreement"), and the Preferred Stock Investment Agreement dated March 6, 2002,
by and between the Company and the Bank (the "Preferred Stock Investment
Agreement"); (ii) reduce the Revolving Credit Commitment (as defined in the
Credit Agreement) and the amount outstanding under the Revolving Credit Loans
(as defined in the Credit Agreement) to an amount equal to $8,000,000; (iii)
reduce the Term Loan (as defined in the Credit Agreement) to an amount equal to
$4,903,874.69; (iv) reduce the L/C Obligations (as defined in the Credit
Agreement) to an amount equal to $1,500,000; and (v) amend the covenants
contained in the Credit Agreement as set forth herein. The Company has agreed to
all of these terms and conditions. The Certificate of Designation, the
Registration Rights Agreement and the Preferred Stock Investment Agreement shall
collectively be referred to as the "Equity Documents."
Accordingly, the Company and the Bank hereby agree as follows:
1. Capitalized terms used in this First Amendment and not otherwise
defined herein shall have the meanings assigned thereto in the Credit Agreement.
2. The definition of the term, "Borrowing Base," contained in
Section 1.1 of the Credit Agreement is hereby deleted in its entirety and the
following definition is substituted in its place:
"Borrowing Base" means, for any day, the sum of (i) eighty
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percent (80%) of the aggregate Net Unpaid Balance of all Eligible
Accounts plus (ii) fifty percent (50%) of the value of all Eligible
Inventory , provided that sub-clause (ii) shall never exceed (A)
$4,000,000 for the period commencing on March 6, 2002 to and
including May 30, 2002, (B) $3,000,000 for the period commencing on
May 31, 2002 to and including August 30, 2002 and (C) $2,000,000 at
all times thereafter.
3. The definition of the term, "Default Rate," contained in Section
1.1 of the Credit Agreement is hereby deleted in its entirety and the following
definition is substituted in its place:
"Default Rate" means a rate of interest equal to the Prime
------------
Rate plus six percent (6%) per annum, with such rate to change as of
the date of each change in the Prime Rate.
4. The definition of the term, "L/C Fee," contained in Section 1.1
of the Credit Agreement is hereby deleted in its entirety and the following
definition is substituted in its place:
"L/C Fee" means, with respect to the Tecom Letter of Credit,
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$35,000, and, with respect to the Maxi Switch Letter of Credit,
$15,000.
5. The definition of the term, "Revolving Credit Commitment,"
contained in Section 1.1 of the Credit Agreement is hereby deleted in its
entirety and the following definition is substituted in its place:
"Revolving Credit Commitment" means Twenty-One Million Five
---------------------------
Hundred Thousand Dollars ($21,500,000) for the period from the
Closing Date to and including December 30, 2000, Sixteen Million
Five Hundred Thousand Dollars ($16,500,000) for the period from
December 31, 2000 to and including March 5, 2002 and Eight Million
Dollars ($8,000,000) for the period from March 6, 2002 to the
Revolving Credit Termination Date.
6. The definition of the term, "Revolving Credit Termination Date,"
contained in Section 1.1 of the Credit Agreement is hereby deleted in its
entirety and the following definition is substituted in its place:
"Revolving Credit Termination Date" means the earlier to occur
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of (i) March 31, 2003 and (ii) the date on which the Revolving
Credit Commitment is terminated pursuant to Section 11.
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7. The following defined terms are hereby inserted in the
appropriate alphabetical order in Section 1.1 of the Credit Agreement:
"Bank's Consultant" shall mean Xxxx Xxxxx Consulting Group,
------------------
LLC.
"Budgeted Consolidated EBITDA" means the projected
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Consolidated EBITDA for a particular calendar month (i) in 2002, as
set forth in the Comdial Corporation Budgeted Income Statement for
2002 for such month delivered to the Bank by the Company on February
27, 2002 and (ii) in 2003, as set forth in the projected income
statement for the Company and its Subsidiaries for such month
delivered to the Bank no later than October 1, 2002 in accordance
with Section 8.19(b).
"Capital Expenditures" shall mean, for any period, capital
--------------------
expenditures of the Company and its Subsidiaries for such period.
"Cumulative Consolidated EBITDA" means, for any period, ninety
------------------------------
percent (90%) of the sum of Budgeted Consolidated EBITDA for the
period commencing on April 1, 2002 to and including the date of
measurement.
"Equity Documents" shall mean, collectively, the Comdial
----------------
Corporation Certificate of Designation of Series B Alternate Rate
Cumulative Convertible Redeemable Preferred Stock dated March 6,
2002, the Registration Rights Agreement dated March 6, 2002, by and
between the Company and the Bank (the "Registration Rights
Agreement"), and the Preferred Stock Investment Agreement dated
March 6, 2002, by and between the Company and the Bank, and all
amendments, restatements and other modifications to such documents.
"Maxi Switch Letter of Credit" means letter of credit number
----------------------------
3039893 in the face amount of $300,000 issued by the Bank for the
account of the Company and for the benefit of Maxi Switch, Inc.,
which letter of credit is scheduled to expire on March 31, 2002.
"Tecom Letter of Credit" means letter of credit number 3035219
----------------------
in the face amount of $1,200,000 issued by the Bank for the account
of the Company and for the benefit of Tecom Co., Ltd., which letter
of credit is scheduled to expire on March 31, 2002.
8. Section 2.1 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
2.1 Revolving Credit Loans. Upon the terms and subject to the
----------------------
conditions contained in this Agreement, the Bank agrees to make
loans (herein referred to collectively as the "Revolving Credit
Loans") to the Company from time to time during the period from the
date of this Agreement until the Revolving Credit Termination Date;
provided that (i) for the period commencing on the Closing Date to
and including March 5, 2002, the aggregate principal amount of
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all outstanding Revolving Credit Loans does not at any time exceed
the lesser of (a) the Revolving Credit Commitment minus the L/C
Obligations and (b) the Borrowing Base minus the L/C Obligations,
and (ii) for the period commencing on March 6, 2002 to and including
the Revolving Credit Termination Date, the aggregate principal
amount of all outstanding Revolving Credit Loans does not exceed the
lesser of (a) the Revolving Credit Commitment and (b) the Borrowing
Base.
9. The first sentence of Section 2.2 of the Credit Agreement is
hereby deleted in its entirety and the following sentences are substituted in
its place:
The obligation of the Company to repay the Revolving Credit Loans
will be evidenced by the Company's promissory note payable to the
order of the Bank at its office at 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000,
XxXxxx, Xxxxxxxx 00000, or such other place as the holder may from
time to time designate, (i) for the period commencing on the Closing
Date to and including March 5, 2002, in substantially the form of
Exhibit A attached hereto with the blanks therein appropriately
---------
completed, dated as of the date of the initial Revolving Credit Loan
and payable on the Revolving Credit Termination Date (the "Revolving
Credit Note") and (ii) for the period commencing on March 6, 2002
and thereafter, in substantially the form of Exhibit A-1 attached
-----------
hereto with the blanks therein appropriately completed, dated as of
March 6, 2002 and payable on the Revolving Credit Termination Date
(the "Replacement Revolving Credit Note"). Upon the execution and
delivery of the Replacement Revolving Credit Note, the Replacement
Revolving Credit Note will supercede and replace the Revolving
Credit Note and, from and after such date, all references to the
Revolving Credit Note in this Agreement and the Loan Documents shall
be deemed to be references to the Replacement Revolving Credit Note.
10. Section 3.1 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
3.1 Letter of Credit Facility. In accordance with the terms
-------------------------
and conditions contained in this Agreement and in the applicable L/C
Applications, the Bank has issued the Maxi Switch Letter of Credit
and the Tecom Letter of Credit (herein referred to collectively as
the "Letters of Credit") for the account of the Company, and, upon
the terms and subject to the conditions contained in this Agreement
and the applicable L/C Applications, the Bank agrees to extend the
expiration date of each of the Maxi Switch Letter of Credit and the
Tecom Letter of Credit to March 31, 2003. The Company acknowledges
and agrees that the Bank has no obligation to issue any other
Letters of Credit.
11. The first two sentences of Section 3.3 of the Credit Agreement
are hereby deleted in their entirety and the following sentence is substituted
in their place:
The Company will pay the L/C Fee to the Bank on March 6, 2002, which
fee will be fully earned and nonrefundable once paid.
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12. Section 3.4 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
3.4 Reimbursement Obligations. The Company will pay to the
-------------------------
Bank promptly upon demand any and all amounts paid by the Bank under
any Letter of Credit, as provided in the applicable L/C Application,
together with interest on such amount from the date such amount was
paid by the Bank to the date it receives payment in federal or other
immediately available funds at the Prime Rate plus four percent (4%)
per annum, with such rate to be reset on each day on which there is
a change to the Prime Rate. Such interest shall be computed for the
actual number of days elapsed over a year of 360 days.
13. Section 3.5 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
3.5 Expiration of Letters of Credit. Unless the Bank shall
-------------------------------
agree otherwise, all Letters of Credit shall expire on or before
March 31, 2003.
14. Section 4.2 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
The obligation of the Company to repay the Term Loan will be
evidenced by the Company's promissory note payable to the order of
the Bank at its office at 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000, XxXxxx,
Xxxxxxxx 00000, or such other place as the holder may from time to
time designate, (i) for the period commencing on the Closing Date to
and including March 5, 2002, in substantially the form of Exhibit B
---------
attached hereto with the blanks therein appropriately completed,
dated as of the date of the single advance under the Term Loan (the
"Term Loan Note") and (ii) for the period commencing on March 6,
2002 and thereafter, in substantially the form of Exhibit B-1
-----------
attached hereto with the blanks therein appropriately completed,
dated as of March 6, 2002 (the "Replacement Term Loan Note"). Upon
the execution and delivery of the Replacement Term Loan Note, the
Replacement Term Loan Note will supercede and replace the Term Loan
Note and, from and after such date, all references to the Term Loan
Note in this Agreement and the Loan Documents shall be deemed to be
references to the Replacement Term Loan Note. For the period
commencing on the Closing Date to and including August 31, 2002,
installments of interest on the Term Loan Note shall be due and
payable commencing on November 30, 2000 and continuing on the last
day of each month thereafter to and including August 31, 2002. For
the period commencing on the Closing Date to and including August
31, 2002, installments of principal on the Term Loan Note shall be
due and payable on the following dates in the following amounts:
June 30, 2001, $2,500,000; September 30, 2001, $2,500,000; and
December 31, 2001, $2,500,000. For the period commencing on
September 1, 2002 and continuing to and including February 28, 2003,
installments of principal and interest, each in an amount equal to
the
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amount necessary to fully amortize the principal balance of the Term
Loan Note as of September 1, 2002 at an interest rate equal to the
interest rate provided in Section 5 over an assumed 36-month period,
shall be due and payable commencing on September 30, 2002 and
continuing on the last day of each month thereafter to and including
February 28, 2003. A final installment of the entire unpaid
principal balance of the Term Loan Note together with all accrued
interest thereon shall be due and payable on March 31, 2003. The
Company acknowledges and agrees that, because the Term Loan Note
will bear interest based on the Prime Rate, the Bank shall have the
right to adjust the amount of the principal and interest
installments due after an increase in the Prime Rate during the
period commencing on March 6, 2002 and continuing to and including
February 28, 2003. The Company further acknowledges and agrees that,
although a 36-month period will be used to determine the amount of
the first seven (7) installments of principal and interest due on
the Term Loan Note during the period commencing on January 1, 2002
and continuing to and including February 28, 2003, if not sooner
paid, the entire unpaid principal balance of the Term Loan Note
together with all accrued interest thereon shall be immediately due
and payable on March 31, 2003.
15. Section 4.4(a)(1) of the Credit Agreement is hereby deleted in
its entirety and the following provision is substituted in its place:
(a)(1) [Reserved].
16. Section 5.2 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
5.2 Interest Rates. The outstanding principal balance of the
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Revolving Credit Loans and the Term Loan as they exist from time to
time commencing on the Closing Date and continuing to and including
March 30, 2001 will (subject to Section 5.3) bear interest at an
annual rate equal to the LIBOR Daily Floating Rate plus three
percent (3%), with such rate to be initially set by the Bank on the
Closing Date and with such rate to be reset on each day during such
period on which there is a change to the LIBOR Daily Floating Rate.
The outstanding principal balance of the Revolving Credit Loans and
the Term Loan as they exist from time to time commencing on March
31, 2001 and continuing to and including January 14, 2002 will
(subject to Section 5.3) bear interest at an annual rate equal to
the Prime Rate plus three percent (3%), with such rate to be reset
on each day on which there is a change to the Prime Rate. The
outstanding principal balance of the Revolving Credit Loans and the
Term Loan as they exist from time to time commencing on January 15,
2002 and continuing until the Revolving Credit Loans and the Term
Loan are paid in full will (subject to Section 5.3) bear interest at
an annual rate equal to the Prime Rate plus four percent (4%), with
such rate to be reset on each day on which there is a change to the
Prime Rate. Interest on the Revolving Credit Loans and on the Term
Loan
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will be computed on the basis of the actual number of days elapsed
over a year of 360 days.
17. Sections 8.1(a) and 8.1(b) of the Credit Agreement are hereby
deleted in their entirety and the following provisions are substituted in their
respective places:
(a) as soon as available, but in no event more than forty-five
(45) days after the end of each of the Company's fiscal quarters,
consolidated and consolidating balance sheets of the Company and its
Subsidiaries as of the end of such quarter and consolidated and
consolidating income statements of the Company and its Subsidiaries
to the end of such quarter, each in reasonable detail and in form
and substance satisfactory to the Bank, prepared in accordance with
GAAP and certified by the chief financial officer of the Company,
provided that the Company may deliver, in lieu of the foregoing
quarterly financial statements, the quarterly report of the Company
for the applicable fiscal quarter on Form 10-Q filed with the SEC,
but only as long as the financial statements contained in such
quarterly report are substantially the same in content as the
financial statements referred to above in this Section 8.1(a); with
such quarterly financial statements to be accompanied by (i)
consolidated and consolidating balance sheets and consolidated and
consolidating income statements with respect to Material
Subsidiaries for which there has been any material financial
activity during the applicable quarter, prepared in the ordinary
course of the Company's business, and (ii) a compliance certificate,
in form and detail satisfactory to the Bank and signed by the chief
financial officer of the Company, which provides a detailed
calculation of the financial covenants contained herein as of the
applicable fiscal quarter end and a statement as to whether the
Company is in compliance with all of the terms and conditions of
this Agreement;
(b) as soon as available, but in no event more than ninety
(90) days after the end of each of the Company's fiscal years, a
copy of the annual consolidated and consolidating financial
statements of the Company and its Subsidiaries in reasonable detail
and in form and substance satisfactory to the Bank, prepared in
accordance with GAAP and audited by certified public accountants of
national standing or otherwise satisfactory to the Bank, which
financial statements shall include consolidated and consolidating
balance sheets of the Company and its Subsidiaries as of the end of
such fiscal year, consolidated and consolidating statements of
income and retained earnings of the Company and its Subsidiaries for
such fiscal year, consolidated and consolidating statements of cash
flows for the Company and its Subsidiaries for such fiscal year, a
reconciliation of net worth, and all normal and reasonable financial
notes, provided that the Company may deliver, in lieu of the
foregoing annual financial statements, the annual report of the
Company for the applicable fiscal year on Form 10-K filed with the
SEC, but only as long as the financial statements contained in such
annual report are substantially the same in content as the financial
statements referred to above in this Section 8.1(b); with such
annual financial statements to be accompanied by a compliance
certificate, in form and
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detail satisfactory to the Bank and signed by the chief financial
officer of the Company, which provides a detailed calculation of the
financial covenants contained herein as of the applicable fiscal
year end and a statement as to whether the Company is in compliance
with all of the terms and conditions of this Agreement;
18. Section 8.1(f) of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
(f) (1) As soon as available and in any event within fifteen
(15) days after the end of each fiscal month of the Company, a
Borrowing Base Certificate executed by the chief financial officer
of the Company setting forth the Borrowing Base and the Term Loan
Collateral Value as of the last Business Day of such month, and, if
the Company or any of its Subsidiaries engaged in any Asset Sales
during such month in which the value of the assets so sold was less
than $50,000 or which, when aggregated with the value of all other
assets sold in connection with other Assets Sales occurring during
the same fiscal month of the Company, had a value greater than
$200,000, such Borrowing Base Certificate shall include an
itemization of the assets sold during such month, the value of such
assets, and the net consideration received for such assets; and (2)
as soon as available and in any event by 5:00 pm eastern time on
March 4, 2002 and not later than 5:00 pm eastern time on each Monday
thereafter: (i) a Borrowing Base Certificate current as of the
Friday immediately preceding such Monday prepared by and executed in
accordance with the requirements of Section 8.1(f)(1) and containing
all of the information required to be contained in the Borrowing
Base Certificate required by Section 8.1(f)(1), (ii) a sales report
in form and substance acceptable to the Bank in its sole discretion
current as of the Friday immediately preceding such Monday that
describes all sales of Inventory and other goods by the Company or
any of its Subsidiaries by the following three (3) customer types:
supply houses, dealers and national accounts, (iii) a report in form
and substance acceptable to the Bank in its sole discretion current
as of the Friday immediately preceding such Monday that identifies
any officers or key employees that have terminated employment with
the Company or any of its Subsidiaries or have notified the Company
or any of its Subsidiaries of such officer's or employee's intention
to do so, (iv) a report in form and substance acceptable to the Bank
in its sole discretion current as of the Friday immediately
preceding such Monday that identifies any material customers of the
Company or any of its Subsidiaries that have ceased purchasing
Inventory or other goods from the Company or any of its Subsidiaries
or that have notified the Company or any of its Subsidiaries of such
material customer's intention to do so, and (v) a report in form and
substance acceptable to the Bank in its sole discretion that
describes the status of the Company's efforts to acquire or be
acquired by another person or legal entity and the status of the
Company's efforts to refinance the Revolving Credit Loans and the
Term Loan.
19. Section 8.16 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
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8.16 Establishment of Lock-Box Account and Notification to
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Account Debtors. On or before April 30, 2002, the Company shall
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execute and deliver to the Bank all documents required by the Bank
to establish and administer a lock-box account for the Accounts.
Immediately after such lock-box account has been established, the
Company and each Material Subsidiary shall promptly notify each
Account Debtor in respect of any Account that any payments due or to
become due in respect of such Account are to be made in the name of
the Company or such Material Subsidiary to such address and post
office box as shall be specified by the Bank.
20. Section 8 of the Credit Agreement is hereby amended by inserting
the following new sections immediately following Section 8.18:
8.19 Implementation of Procedures and Systems.
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(a) In no event later than February 28, 2002, the Company and
its Subsidiaries shall implement procedures and systems that are
necessary to provide the Bank with the following financial
information, all of which information shall be in form and substance
acceptable to the Bank in its sole discretion:
(i) a projected income statement for the Company for
each calendar month in calendar year 2002 and for calendar year 2002
taken as a whole, which procedures and systems shall have the
ability to (A) be updated monthly, (B) create revised projected
income statements for each calendar month in calendar year 2002 and
for calendar year 2002 taken as a whole, and (C) provide an analysis
that compares the actual income and expenses for each line item in
each such projection for the month then ended and year to date to
the income and expenses that had been projected for the period being
measured. Commencing on March 15, 2002 and continuing on the
fifteenth (15th) day after the end of each calendar month
thereafter, the Company shall provide such reports to the Bank by
5:00 pm eastern time on such fifteenth day after the end of each
calendar month, each such report being current as of the end of the
immediately preceding calendar month.
(ii) a projected cash flow statement for the period
commencing on the date of measurement and terminating thirteen weeks
thereafter, which procedures and systems shall have the ability to
(A) be updated weekly, (B) create revised projected cash flow
statements for the period commencing on the date of measurement and
terminating thirteen week thereafter, and (C) provide an analysis
that compares the actual income and expenses for each line item in
each such projection for the week then ended to the income and
expenses that had been projected for such week. Commencing on the
March 11, 2002 and continuing on each Monday thereafter, the Company
shall provide such reports to the Bank by 5:00 pm eastern time on
each such Monday, each such report being current as of the Friday
immediately preceding each such Monday.
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(iii) a weekly cash receipts statement that summarizes
all cash receipts, compares the actual cash receipts to the cash
receipts that had been projected for that week, and identifies the
amount of cash on hand. Commencing on March 11, 2002 and continuing
on each Monday thereafter, the Company shall provide such reports to
the Bank by 5:00 pm eastern time on each such Monday, each such
report being current as of the Friday immediately preceding each
such Monday.
(b) In no event later than October 1, 2002, the Company and
its Subsidiaries shall implement procedures and systems that are
necessary to provide the Bank with a projected income statement for
the Company for each calendar month in calendar year 2003 and for
calendar year 2003 taken as a whole, which procedures and systems
shall have the ability to (A) be updated monthly, (B) create revised
projected income statements for each calendar month in calendar year
2003 and for calendar year 2003 taken as a whole, and (C) provide an
analysis that compares the actual income and expenses for each line
item in each such projection for the month then ended and year to
date to the income and expenses that had been projected for the
period being measured, all of which information shall be in form and
substance acceptable to the Bank in its sole discretion. Commencing
on January 15, 2003 and continuing on the fifteenth (15th) day after
the end of each calendar month thereafter, the Company shall provide
such reports to the Bank by 5:00 pm eastern time on such fifteenth
day after the end of each calendar month, each such report being
current as of the end of the immediately preceding calendar month.
8.20 Expense Reduction Report. Commencing on March 11, 2002
------------------------
and continuing on the first day of each calendar month thereafter,
the Company shall provide to the Bank by 5:00 pm eastern time on
each such day a report in form and substance acceptable to the Bank
in its sole discretion that describes the progress the Company and
its Subsidiaries have made in implementing and executing the plan to
reduce the Company's and its Subsidiaries' consolidated operating
expenses to an amount not greater than the Company's and its
Subsidiaries' consolidated operating income, each such report being
current as of the end of the immediately preceding calendar month.
8.21 Bank's Consultant. The Company shall cooperate fully with
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the Bank's Consultant, which cooperation shall include, without
limitation, allowing the Bank's Consultant reasonable access to
observe the Company's and its Subsidiaries' respective operations
and the opportunity to inspect their respective financial and other
reports and projections. Furthermore, the Company hereby agrees to
pay all costs and expenses arising from or in connection with the
Bank's Consultant in accordance with the consulting agreement
between the Company and the Bank's Consultant dated as of
________________ ___, 2002 and attached hereto as Exhibit I (the
---------
"Consulting Agreement"), and the Company hereby
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irrevocably authorizes the Bank to charge any and all accounts of
the Company maintained at the Bank for the amount of such costs and
expenses as and when due in accordance with the Consulting
Agreement. Any portion of such fees not paid when due shall bear
interest at the Default Rate until paid in full.
21. Section 9.2 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
9.2 Minimum EBITDA. The Company will not permit Consolidated
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EBITDA or Consolidated EBITDA to Budgeted Consolidated EBITDA to be
less than the following amounts or percentages, as applicable,
measured as of the end of the fiscal quarters of the Company shown
below for the periods shown below:
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Budgeted Minimum Cumulative
Measurement Period Consolidated EBITDA Consolidated EBITDA Consolidated EBITDA
========================================================================================
March 1, 2002 to <$2,649.00> <$3,311.00> N/A
and including
March 31, 2002
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April 1, 2002 to $280,060.00 $224,048.00 $249,670.00
and including
April 30, 2002
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May 1, 2002 to and $650,027.00 $520,022.00 $834,694.00
including May 31,
2002
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June 1, 2002 to $437,952.00 350,362.00 $1,228,851.00
and including June
30, 2002
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July 1, 2002 to $646,124.00 $516,899.00 $1,810,363.00
and including July
31, 2002
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August 1, 2002 to $604,371.00 $483,497.00 $2,354,297.00
and including
August 31, 2002
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September 1, 2002 $391.872.00 $313,498.00 $2,706,981.00
to and including
September 30, 2002
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October 1, 2002 to $973,413.00 $778,730.00 $3,583,053.00
and including
October 31, 2002
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November 1, 2002 $574,828.00 $459,862.00 $4,100,398.00
to and including
November 30, 2002
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December 1, 2002 $617,179.00 $493,743.00 $4,655,859.00
to and including
December 31, 2002
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January 1, 2003 to [As set forth in [80% of Budgeted [90% of the sum
and including the projected Consolidated EBITDA of Budgeted
January 31, 2003 income statement for the period Consolidated
required by Section January 1, 2003 to EBITDA for the
8.19(b) for the and including period April 1,
period January 1, January 31, 2003] 2002 to and
2003 to and including
including January January 31, 2003]
31, 2003]
----------------------------------------------------------------------------------------
February 1, 2003 [As set forth in [80% of Budgeted [90% of the sum
to and including the projected Consolidated EBITDA of Budgeted
February 28, 2003 income statement for the period Consolidated
required by Section February 28, 2003 EBITDA for the
8.19(b) for the to and including period April 1,
period February 1, February 28, 2003] 2002 to and
2003 to and including
including February February 28,
28, 2003] 2003]
----------------------------------------------------------------------------------------
-12-
22. Section 10.3 of the Credit Agreement is hereby amended by
deleting clause (i) and renumbering clauses (ii), (iii) and (iv) as clauses (i),
(ii) and (iii) respectively.
23. Section 10.4 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
10.4 Acquisitions. Acquire, or permit any Subsidiary to
------------
acquire, in one transaction or a series of transactions, all or any
substantial part of the capital stock (or other ownership interests)
or assets of any other Person.
24. Section 10 of the Credit Agreement is hereby amended by
inserting the following new section immediately following Section 10.9:
10.10 Capital Expenditures. Expend, or permit any of its
--------------------
Subsidiaries to expend, for Capital Expenditures an amount in excess
of $300,000 during any fiscal quarter of the Company occurring
during the period January 1, 2002 to and including March 31, 2003.
25. Sections 11.9 and 11.10 of the Credit Agreement are hereby
deleted in their entirety and the following two provisions are substituted in
their respective places:
11.9 Any default shall be made in the performance of any other
obligation incurred in connection with any indebtedness for borrowed
money of the Company or any Material Subsidiary aggregating $25,000
or more, if the effect of such default is to permit the holder of
such indebtedness (or a trustee on behalf of such holder) to cause
it to become due prior to its stated maturity or to do so with the
giving of notice or passage of time, or both, or any such
indebtedness becomes due prior to its stated maturity or shall not
be paid when due; or
11.10 One or more final judgments for the payment of money
aggregating in excess of $25,000 which is or are not adequately
insured or indemnified against shall be rendered at any time against
the Company or any Material Subsidiary and the same shall remain
undischarged for a period of thirty (30) days during which time
execution shall not be effectively stayed; or
26. Section 11.13 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
11.13 A default or an event of default shall have occurred
under any of the other Loan Documents or under any of the Equity
Documents; provided, however, that no such default shall constitute
an Event of Default hereunder if the default is remedied to the
Bank's satisfaction within any applicable grace or cure period;
-13-
27. Section 13.4 of the Credit Agreement is hereby deleted in its
entirety and the following provision is substituted in its place:
13.4 Notices. All notices, requests and other communications
-------
to either party hereunder will be in writing and will be given at
its address or telecopy number set forth below or such other address
or telecopy number as such party may hereafter specify in writing
for this purpose by notice to the other party:
If to the Company:
Comdial Corporation
000 Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telecopy Number: (000) 000-0000
With a copy to:
Xxxxxxxx, Loop & Xxxxxxxx, LLP
Bank of America Plaza
000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esquire
Telecopy Number: (000) 000-0000
If to the Bank:
Bank of America, N.A.
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
Telecopy Number: (000) 000-0000
With a copy to:
Xxxxxxxx Xxxxxxx LLP
0000 Xxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. duB. Xxxxx, Esquire
Telecopy Number: (000) 000-0000
Each such notice, request or other communication will be
effective if delivered by hand delivery or sent by telecopy,
recognized overnight courier service or certified mail, return
receipt requested, and shall be presumed to be
-14-
received by a party hereto (i) on the date of delivery if delivered
by hand or sent by telecopy, (ii) on the next Business Day if sent
by recognized overnight courier service, charges prepaid, and (iii)
on the third Business Day following the date sent by certified mail,
return receipt requested, postage prepaid.
28. The Bank hereby waives all Defaults and Events of Default that
existed (i) under the Term Loan Note because of the Company's failure to pay
timely the principal installments that were due on each of September 30, 2001
and Xxxxxxxx 00, 0000, (xx) under Section 9.1 of the Credit Agreement for the
period ending December 31, 2000, (iii) under Section 9.2 of the Credit Agreement
for the periods ending March 31, 2001, June 30, 2001, September 30, 2001 and
December 31, 2001 and (iv) under Section 8.16 because the Company failed to
establish a lock-box by December 31, 2000, but the Bank expressly does not waive
any other Defaults or Events of Default that have occurred or exist as of the
date of this First Amendment or any Defaults or Events of Default that may occur
or exist after the date of this First Amendment under the Credit Agreement, as
amended by this First Amendment, or any of the other Loan Documents.
29. Simultaneously upon the satisfaction of all of the conditions
precedent set forth in paragraph 33 of this First Amendment and the Bank's
execution and delivery of this First Amendment, the Company and the Bank agree
that the Bank shall exchange (A)(i) $7,500,000 of the indebtedness under the
Revolving Credit Loans (so that the resulting principal balance outstanding
under the Revolving Credit Loans shall be, as of the date of this First
Amendment, $8,000,000), which Revolving Credit Loans shall hereafter be
evidenced by the Replacement Revolving Credit Note, and (ii) $2,500,000 of the
indebtedness under the Term Loan (so that the resulting principal balance
outstanding under the Term Loan shall be, as of the date hereof, $4,903,874.69),
which Term Loan shall hereafter be evidenced by the Replacement Term Loan Note,
for (B) 1,000,000 shares of Series B Alternate Rate Cumulative Convertible
Redeemable Preferred Stock issued by the Company pursuant to the Equity
Documents.
30. The Company hereby absolutely and unconditionally agrees to pay
to the Bank a fee (the "Restructuring Fee") in the amount of $150,000 in
immediately available funds with respect to this First Amendment, which
Restructuring Fee the Company hereby acknowledges and agrees is fully earned as
of the date of this First Amendment and not subject to diminution for any
reason. The Restructuring Fee shall be payable as follows: $50,000 on the date
of this First Amendment, $50,000 on April 5, 2002, and $50,000 on May 5, 2002.
If the Company shall fail to pay any portion of the Restructuring Fee in
accordance with the immediately preceding sentence, such failure shall be an
Event of Default that is not subject to any grace or cure period and the Bank
shall have all of the rights and remedies set forth in the Credit Agreement, as
amended by this First Amendment, and the other Loan Documents.
31. The Credit Agreement is hereby amended to add a new exhibit,
which exhibit shall be in the form of Exhibit A-1 attached to this First
Amendment and shall be labeled Exhibit A-1. The Credit Agreement is hereby
-----------
amended to add a second new exhibit, which second exhibit shall be in the form
of Exhibit B-1 attached to this First Amendment and shall be labeled Exhibit
-------
B-1. The Credit Agreement is hereby amended to add a third new exhibit, which
---
-15-
third exhibit shall be in the form of Exhibit I attached to this First Amendment
---------
and shall be labeled Exhibit I.
---------
32. The Company hereby represents and warrants to the Bank (which
representations and warranties shall survive the execution and delivery of this
First Amendment) that, as of the date of the execution of this First Amendment:
(a) It is in compliance with all of the terms, covenants and
conditions of the Credit Agreement, as amended by this First Amendment, and each
of the other Loan Documents.
(b) There exists no Default or Event of Default under the
Credit Agreement, as amended by this First Amendment, that has not been
expressly waived pursuant to this First Amendment.
(c) Except as set forth on Schedule 1 attached hereto, the
----------
representations and warranties contained in Section 6 of the Credit Agreement
are, except to the extent that they relate solely to an earlier date, true with
the same effect as though such representations and warranties had been made on
the date of this First Amendment; and the Company further represents and
warrants that each of American Telecommunications Corp., Comdial Consumer
Communications Corporation, Comdial Custom Manufacturing Inc., Comdial
Technology Corporation, Comdial Video Telephony Inc., Telecom Technologies Inc.
and Comdial Convergent Communications, Inc. was dissolved in December, 2001.
(d) Each of the Company and its Subsidiaries has full
corporate power and authority and has taken all necessary corporate action to
authorize the execution, delivery and performance of this First Amendment, the
new promissory notes (in the forms attached hereto as Exhibit A-1 and Exhibit
----------- -------
B-1, respectively, the "Replacement Revolving Credit Note" and the "Replacement
---
Term Loan Note," respectively), the acknowledgment of company and guarantors
attached hereto and made a part hereof as Exhibit C (the "Acknowledgment") and
---------
the Equity Documents to which it is a party. No consent or approval of the
shareholders of the Company (except for any such approval as may be required by
NASDAQ in connection with the conversion of the Series B Preferred Stock (as
defined in the Certificate of Designation)) or any of its Subsidiaries or
consent or approval of, notice to or filing with, any Governmental Authority,
securities exchange or other securities self-regulatory organization (except for
any such consent, approval, notice, or filing as may be required by the
Securities and Exchange Commission or NASDAQ in connection with the conversion
of the Series B Preferred Stock), is required as a condition to the validity of
or the performance by the Company or any of its Subsidiaries of its obligations
under this First Amendment, either of the promissory notes described in the
immediately preceding sentence, the Acknowledgment or the Equity Documents.
(e) This First Amendment, the Replacement Revolving Credit
Note, the Replacement Term Loan Note, the Acknowledgment and the Equity
Documents have been duly executed and delivered by the duly authorized officers
of the Company and each of its Subsidiaries party thereto, and each such
document constitutes the legal, valid and binding obligation of the Company and
the applicable Subsidiaries which are parties thereto, and is
-16-
enforceable in accordance with their respective terms, except to the extent such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization and moratorium laws and similar laws relating generally to the
enforcement of creditors' rights.
(f) Except as disclosed on Schedule 1 attached hereto, there
----------
are no proceedings pending or, to the knowledge of the Company, threatened
before any court or administrative agency that would reasonably be expected, in
any particular case or in the aggregate, to have a material adverse effect upon
the ability of the Company or any of its Subsidiaries to perform any of its
obligations under the Credit Agreement, as amended by this First Amendment, the
Replacement Revolving Credit Note, the Replacement Term Loan Note, the
Acknowledgment, any of the other Loan Documents or any of the Equity Documents,
or could reasonably be expected to have a Material Adverse Effect.
(g) The execution, delivery and performance by the Company and
its Subsidiaries of this First Amendment, the Replacement Revolving Credit Note,
the Replacement Term Loan Note, the Acknowledgment and the Equity Documents in
accordance with their respective terms do not (i) require any approval of,
notice to or filing with any Governmental Authority, securities exchange or
other securities self-regulatory organization (except for any such approval,
notice, or filing as may be required by the Securities and Exchange Commission
or NASDAQ in connection with the conversion of the Series B Preferred Stock), or
violate any federal, state or local law, rule or ordinance relating to the
Company or any of its Subsidiaries, (ii) conflict with, result in a breach of or
constitute a default under the charter, bylaws or preference stock provisions of
the Company or any of its Subsidiaries or any mortgage, indenture, contract or
agreement binding on the Company or any of its Subsidiaries or affecting any of
their respective properties or any approval of any Governmental Authority
relating to the Company or any of its Subsidiaries, or (iii) result in or
require the creation or imposition of any lien, security interest, charge or
other encumbrance (collectively, "Liens") upon or with respect to any property
now owned or hereafter acquired by the Company or any of its Subsidiaries other
than Liens arising under the Loan Documents.
(h) This First Amendment and the Equity Documents are not
being made or entered into with the intent to hinder, delay or defraud any
person or entity.
(i) Except as set forth on Schedule 1 attached hereto, no
----------
action or proceeding under any federal or state insolvency or debtor relief law,
including without limitation a voluntary or involuntary petition for bankruptcy
under any chapter of the Federal Bankruptcy Code, has been instituted or, to the
Company's knowledge, threatened against the Company or any of its Subsidiaries.
33. The Bank's agreement to enter into this First Amendment is
subject to the following conditions precedent:
(a) The Company shall have executed and delivered to the Bank
this First Amendment.
-17-
(b) The Company shall have executed and delivered the
Replacement Revolving Credit Note and the Replacement Term Loan Note in the
forms of Exhibit A-1 and Exhibit B-1, respectively, attached hereto with the
blanks therein appropriately completed.
(c) The Company shall have delivered to the Bank (i) certified
copies of the resolutions of its board of directors and the boards of directors
of its Subsidiaries authorizing and approving this First Amendment, the
Replacement Revolving Credit Note, the Replacement Term Loan Note, the
Acknowledgment and the Equity Documents and (ii) a certificate of incumbency for
the Company executed by the secretary of the Company and a certificate of
incumbency for each of its Subsidiaries setting forth the names of the officers
of the Company and the Subsidiaries, as applicable, that are authorized to
execute any of this First Amendment, the Replacement Revolving Credit Note, the
Replacement Term Loan Note, the Acknowledgment or the Equity Documents, together
with a specimen signature for each such officer.
(d) The Company and each of the Company's Subsidiaries shall
have executed and delivered to the Bank the Acknowledgment.
(e) The Bank shall have received favorable opinions of counsel
to the Company and the Subsidiaries addressed to the Bank, dated as of the date
hereof and satisfactory in form and substance to the Bank, as to the good
standing of each of the Company and its Subsidiaries in its state of
incorporation, the authority of each of the Company and its Subsidiaries to
transact business in the State of Florida, the due authorization, execution,
delivery and enforceability of this First Amendment, the Replacement Revolving
Credit Note, the Replacement Term Loan Note, the Acknowledgment, the Equity
Documents, certain matters associated with the Equity Documents, and such other
matters as the Bank shall request.
(f) The Bank shall have received payment in immediately
available funds of (i) an amount equal to all accrued but unpaid interest on the
Revolving Credit Note as of Xxxxx 0, 0000, (xx) an amount equal to all accrued
but unpaid interest on the Term Loan Note as of Xxxxx 0, 0000, (xxx) the $50,000
portion of the Restructuring Fee that is due and payable on the date of this
First Amendment and (vi) the $50,000 L/C Fee that is due and payable on March 6,
2002.
(g) The Company shall have executed and delivered, and shall
have caused to be executed and delivered, all of the Equity Documents and all
other documents, instruments, opinions and other papers that the Bank deems
necessary or advisable be delivered to it or filed in connection with the
consummation of the transactions contemplated by the Equity Documents, the
Certificate of Designation shall have been adopted and become effective under
the laws of the State of Delaware, and all other conditions and matters set
forth as conditions precedent in the Equity Documents shall have occurred and be
acceptable to the Bank.
(h) The Company shall have paid all out-of-pocket expenses
incurred by the Bank in connection with the structuring, negotiating and
preparing of this First Amendment, the Replacement Revolving Credit Note, the
Replacement Term Loan Note, the Acknowledgment, the Equity Documents, and all
documents, instruments, agreements, opinions
-18-
and other papers associated with the Equity Documents, including but not limited
to the fees and disbursements of counsel to the Bank.
(i) The Company and the Material Subsidiaries shall have
executed and delivered a closing statement, an aviation/international waters
closing affidavit and a tax indemnity agreement, each in form and substance
acceptable to the Bank.
(j) The Company shall have executed and delivered a pledge
agreement substantially in the form of the Pledge Agreement, a blank stock power
and the original share certificate or certificates for the capital stock of
Comdial Business Communications Corporation, all of which documents shall be in
form and substance acceptable to the Bank.
34. The Company and the Bank hereby agree that this First Amendment
supercedes and replaces the April 10 Letter, and that the April 10 Letter is of
no further force or effect.
35. Except as expressly amended hereby, the terms of the Credit
Agreement shall remain in full force and effect in all respects, and the Company
hereby reaffirms its obligations under the Credit Agreement, as amended by this
First Amendment, and each of the other Loan Documents. The Company hereby waives
any claim, cause of action, defense, counterclaim, setoff or recoupment of any
kind or nature that it may have or assert against the Bank arising from or in
connection with the Credit Agreement, as amended by this First Amendment, the
Revolving Credit Note, the Term Loan Note, the Acknowledgment, any of the other
Loan Documents, the Equity Documents or the transactions contemplated thereby or
hereby that exist on the date hereof or arise from facts or actions occurring
prior to or on the date of this First Amendment. Nothing contained in this First
Amendment shall be construed to constitute a novation with respect to any of the
obligations of the Company or any of its Subsidiaries described in the Credit
Agreement or the other Loan Documents.
36. All references to the Credit Agreement in any of the Loan
Documents, or any other documents or instruments that refer to the Credit
Agreement, shall be deemed to be references to the Credit Agreement as amended
by this First Amendment.
37. This First Amendment, the Replacement Revolving Credit Note, the
Replacement Term Loan Note and the Acknowledgment shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth of
Virginia, without reference to the conflicts or choice of law principles
thereof.
38. This First Amendment may be executed in any number of
counterparts, each of which shall be an original, but all of which taken
together shall constitute one and the same instrument.
39. This First Amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. The
Company shall not have the right to assign any of its rights or obligations
under or delegate any of its duties under the Credit
-19-
Agreement, as amended by this First Amendment, the Replacement Revolving Credit
Note, the Replacement Term Loan Note, the Acknowledgment or any of the other
Loan Documents.
40. The Company and the Lenders hereby acknowledge and agree that
any controversy or claim between or among the parties to the Credit Agreement,
as amended by this First Amendment, the Replacement Revolving Credit Note, the
Replacement Term Loan Note, any of the other Loan Documents or the Equity
Documents, including but not limited to those arising out of or related to this
First Amendment or the Acknowledgment, shall be determined by binding
arbitration as described in Section 13.10 of the Credit Agreement. As provided
in the Credit Agreement, the Company hereby acknowledges and agrees that nothing
in Section 13.10 of the Credit Agreement shall be deemed to limit the right of
the Bank to obtain from a court provisional or ancillary remedies such as (but
not limited to) injunctive relief (including without limitation specific
performance as described in Section 14 of the Registration Rights Agreement),
writ of possession or the appointment of a trustee.
41. The Credit Agreement, as amended by this First Amendment, the
Replacement Revolving Credit Note, the Replacement Term Loan Note, the
Acknowledgment and the other Loan Documents represent the final agreement among
the Company, its Subsidiaries and the Bank with respect to the subject matter
hereof, and may not be contradicted, modified or supplemented in any way by
evidence of any prior or contemporaneous written or oral agreements of the
Company, any of its Subsidiaries or the Bank.
[Remainder of page intentionally left blank]
-20-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers under seal, all as of the day and
year first written above.
COMDIAL CORPORATION
By: /s/ Xxxx X. Xxxxx SEAL)
Name: Xxxx X. Xxxxx
Title: Senior Vice President/Chief
Financial Officer
Witness:
/s/ Xxxxx X. Xxxx
Name: Xxxxx X. Xxxx
BANK OF AMERICA, N.A.
By: /s/ Xxxxxx Xxxxxxxxx SEAL)
Name: Xxxxxx Xxxxxxxxx
Title: Senior Vice President
Witness:
/s/ Xxxxx X. Xxxx
Name: Xxxxx X. Xxxx
#1035255v6
-21-
REVOLVING CREDIT NOTE
---------------------
$8,000,000.00 March 6, 2002
FOR VALUE RECEIVED, COMDIAL CORPORATION (the "Company"), a Delaware
corporation, promises to pay to the order of BANK OF AMERICA, N.A. (the "Bank")
at its office at 000 X. Xxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000, or at such other
place as the noteholder may from time to time designate in writing, the sum of
EIGHT MILLION DOLLARS ($8,000,000.00) or such lesser amount as may have been
advanced hereunder and remain unpaid on the Revolving Credit Termination Date
(as defined in the Credit Agreement, as hereinafter defined), and to pay
interest on the unpaid balance of such sum from the date hereof at the rate or
rates, on the dates and upon the other terms and conditions contained in the
Credit Agreement.
This Note evidences a borrowing under, is subject to the terms and
conditions of, is entitled to the benefits of, and is the Revolving Credit Note
defined in, the Amended and Restated Credit Agreement dated as of November 22,
2000, by and between the Company and the Bank, as amended by a First Amendment
to Amended and Restated Credit Agreement dated as of March 6, 2002 (as so
amended, the "Credit Agreement"). The Credit Agreement contains, among other
things, provisions for the time, place and manner of payment of this Note, the
determination of the interest rate borne by this Note, and the mandatory
repayment of this Note under certain circumstances.
The events of default hereunder are the same as those described in the
Credit Agreement which are incorporated herein by this reference. In the event
of the occurrence of any or all of such events, the entire unpaid principal
balance of this Note together with all accrued interest may automatically
become, or may be declared, immediately due and payable in the manner and with
the effect as provided in the Credit Agreement.
The Company agrees to pay on demand all costs of collection, including
reasonable attorneys' fees, if after default this Note is placed in the hands of
an attorney for collection, or if after default the holder finds it necessary or
desirable to secure the services or advice of an attorney with regard to
collection.
Presentment, demand, protest and notice of dishonor are hereby waived by
all makers and endorsers hereon.
This Note shall be governed by and construed in accordance with the laws
of the Commonwealth of Virginia, without reference to the conflicts or choice of
law principals thereof.
IN WITNESS WHEREOF, COMDIAL CORPORATION has caused its name to be signed
to this Note by its duly authorized officer as of the date first above written.
COMDIAL CORPORATION
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
#1035630v2
200160.545
-2-
TERM LOAN NOTE
--------------
$4,903,874.69 March 6, 2002
FOR VALUE RECEIVED, COMDIAL CORPORATION (the "Company"), a Delaware
corporation, promises to pay to the order of BANK OF AMERICA, N.A. (the "Bank")
at its office at 000 X. Xxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000, or at such other
place as the noteholder may from time to time designate in writing, at the times
and in the manner provided in the Credit Agreement (as hereinafter defined), the
sum of FOUR MILLION NINE HUNDRED THREE THOUSAND EIGHT HUNDRED SEVENTY-FOUR AND
69/100 DOLLARS ($4,903,874.69), and to pay interest on the unpaid balance of
such sum from the date hereof at the rate or rates, on the dates and upon the
other terms and conditions contained in the Credit Agreement.
This Note evidences a borrowing under, is subject to the terms and
conditions of, is entitled to the benefits of, and is the Term Loan Note defined
in, the Amended and Restated Credit Agreement dated as of November 22, 2000, by
and between the Company and the Bank, as amended by a First Amendment to Amended
and Restated Credit Agreement dated as of March 6, 2002 (as so amended, the
"Credit Agreement"). The Credit Agreement contains, among other things,
provisions for the time, place and manner of payment of this Note, the
determination of the interest rate borne by this Note, and the mandatory
repayment of this Note under certain circumstances.
The events of default hereunder are the same as those described in the
Credit Agreement which are incorporated herein by this reference. In the event
of the occurrence of any or all of such events, the entire unpaid principal
balance of this Note together with all accrued interest may automatically
become, or may be declared, immediately due and payable in the manner and with
the effect as provided in the Credit Agreement.
The Company agrees to pay on demand all costs of collection, including
reasonable attorneys' fees, if after default this Note is placed in the hands of
an attorney for collection, or if after default the holder finds it necessary or
desirable to secure the services or advice of an attorney with regard to
collection.
Presentment, demand, protest and notice of dishonor are hereby waived by
all makers and endorsers hereon.
This Note shall be governed by and construed in accordance with the laws
of the Commonwealth of Virginia, without reference to the conflicts or choice of
law principals thereof.
IN WITNESS WHEREOF, COMDIAL CORPORATION has caused its name to be signed
to this Note by its duly authorized officer as of the date first above written.
COMDIAL CORPORATION
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Chief Financial Officer
#1035637v2
200160.545
-2-
