SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
THIS SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this
"AMENDMENT") is made and entered into as of October 31, 1999, between VODAVI
COMMUNICATIONS SYSTEMS, INC. ("BORROWER") and GENERAL ELECTRIC CAPITAL
CORPORATION, a New York corporation ("LENDER").
WITNESSETH:
WHEREAS, the Borrower and the Lender entered into a certain Credit
Agreement, dated as of April 11, 1994 between Vodavi Communications Systems,
Inc., as borrower, and General Electric Capital Corporation, as lender, as
amended and restated as of June 11, 1997 (the "AMENDED AND RESTATED CREDIT
AGREEMENT") and as further amended by that certain Fourth Amendment to Credit
Agreement dated as of September 30, 1999 (the "FOURTH AMENDMENT;" the Amended
and Restated Credit Agreement, as amended by the Fourth Amendment is hereinafter
referred to as the "CREDIT AGREEMENT;" capitalized terms used herein and not
otherwise defined herein shall have the meanings given such terms in the Credit
Agreement), whereby the Lender agreed to make certain loans to the Borrower,
subject to the terms, covenants and conditions contained in the Credit
Agreement; and
WHEREAS, the Borrower has requested that the Lender modify the Credit
Agreement to as described herein and the Lender is willing to make such
modifications, subject to the terms and conditions of this Amendment;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. REDESIGNATION OF FOURTH AMENDMENT. In order to avoid confusion the
Fourth Amendment is hereby redesignated and deemed to be the First Amendment to
the Amended and Restated Credit Agreement, and references therein to the Credit
Agreement shall be deemed to be references to the Amended and Restated Credit
Agreement.
2. AMENDMENTS. (a) Section 1.1 of the Credit Agreement is hereby amended by
inserting in the proper order within such section the following definition:
"REPURCHASE FEE" shall have the meaning assigned to it in Section 2.3(d).
(b) Section 1.1 of the Credit Agreement is hereby amended by replacing the
definition "Fees" with the following:
"FEES" shall mean the Closing Fee, the Non-use Fee, the Commitment
Fee, the Prepayment Fee, the Repurchase Fee, the Letter of Credit Fees and
any other fees due to Lender pursuant to the Loan Documents.
(c) Section 2.1(e) of the Credit Agreement is hereby deleted in its
entirety and replaced by the following:
(e) Use of Proceeds. Borrower shall utilize the proceeds of the
Revolving Credit Advances to provide working capital for Borrower and the
other Credit Parties and to repurchase up to $1,500,000 of the Borrower's
common stock as permitted pursuant to Section 7.12. Borrower may request
that Lender incur Letter of Credit Obligations to support any transaction
for which Borrower could obtain a Revolving Credit Loan hereunder, other
than the repurchase of common stock.
(d) Section 2.3 of the Credit Agreement is hereby amended by inserting at
the end thereof the following new Section 2.3(d):
(d) Stock Repurchase Fee. As additional compensation for Lender's
increased risks associated with permitting the Borrower to repurchase its
common stock on the terms and conditions specified in Section 7.12,
Borrower agrees to pay to Lender, in arrears for the preceding quarter, on
the first Business Day of each quarter prior to the Commitment Termination
Date and on the Commitment Termination Date, a fee (the "REPURCHASE FEE")
in an amount equal to two percent flat (2.00%) of the dollar amount paid to
repurchase such stock during such period.
(e) Section 7.12 of the Credit Agreement is hereby amended by replacing it
in its entirety with the following:
7.12 RESTRICTED PAYMENTS. The Credit Parties shall not make any
Restricted Payment, provided that during the period commencing November 1,
1999 and ending June 30, 2000 (the "purchase period"), the Borrower may
repurchase its common stock subject to the following conditions:
(a) the aggregate purchase price paid for such stock over purchase
period shall not exceed $1,500,000,
(b) both before and after giving effect to each such purchase, no
Default shall have occurred and be continuing, and
(c) at the time of, and after giving effect to, each such purchase
the Company shall have unused Revolving Credit Advance
Availability of not less than $750,000.
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2. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents and
warrants to the Lender that (a) this Amendment has been duly authorized,
executed and delivered by the Borrower, (b) no Default has occurred and is
continuing as of this date, and (c) each of the representations and warranties
of the Borrower made in or pursuant to this Amendment and the other Financing
Documents is true and correct, except to the extent that any such representation
or warranty expressly relates to an earlier date and except for changes therein
expressly permitted or expressly contemplated by the Credit Agreement, both
before and after giving effect to this Amendment. Any breach by the Borrower of
its representations and warranties contained in this Section 2 shall be an Event
of Default for all purposes of the Credit Agreement.
3. RATIFICATION. The Borrower hereby ratifies and reaffirms each and every
term and condition set forth in the Credit Agreement and all other documents
delivered by the Borrower in connection therewith (including without limitation
the other Loan Documents to which the Borrower is a party), effective as of the
date hereof.
4. ESTOPPEL. To induce the Lender to enter into this Amendment, the
Borrower hereby acknowledges and agrees that, as of the date hereof, there
exists no right of offset, defense or counterclaim in favor of the Borrower as
against the Lender with respect to the obligations of the Borrower under the
Credit Agreement or the other Loan Documents, either with or without giving
effect to this Amendment.
5. CONDITIONS TO EFFECTIVENESS. The Amendments contained in Section 1 shall
become effective retroactive to the date as of which this Amendment is dated,
subject to the satisfaction of the following conditions:
(a) the receipt by the Lender of this Amendment, together with the Consent
attached hereto, duly executed, completed and delivered by the Lender, the
Borrower, and the other Credit Parties;
(b) the receipt by the Lender of a certificate signed by the chief
financial officer or treasurer of the Borrower to the effect that, as of the
date of this Amendment, (i) no Default shall have occurred and be continuing and
(ii) each of the representations and warranties of the Credit Parties made in or
pursuant to this Amendment and the other Financing Documents executed by such
Person is true, except to the extent that any such representation or warranty
expressly relates to an earlier date and except for changes therein expressly
permitted or expressly contemplated by the Credit Agreement, both before and
after giving effect to this Amendment;
(c) the receipt by the Lender of such other documents as the Lender may
reasonably request.
6. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK FOR CONTRACTS TO BE PERFORMED
ENTIRELY WITHIN SAID STATE.
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7. SEVERABILITY OF PROVISIONS. Any provision of this Amendment which is
prohibited by, or invalid under the Applicable Law of any jurisdiction shall be
ineffective to the extent of such prohibition or invalidity in such jurisdiction
without invalidating the remaining provisions hereof or affecting the validity
or enforceability of such provision in any other jurisdiction. To the extent
permitted by Applicable Law, Borrower hereby waives any provision of law that
renders any provision hereof unenforceable in any respect.
8. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, all of which shall be deemed to constitute but one original and
shall be binding upon all parties, their successors and permitted assigns.
9. ENTIRE AGREEMENT. The Credit Agreement as amended by this Amendment
embodies the entire agreement between the parties hereto relating to the subject
matter hereof and supersede all prior agreements, representations and
understandings, if any, relating to the subject matter hereof.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective duly authorized officers, as of the date first
above written.
VODAVI COMMUNICATIONS SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Duly Authorized Signatory
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CONSENT
The undersigned Credit Party hereby acknowledges and consents to, and
agrees to the terms of, the foregoing Second Amendment to Credit Agreement, and
ratifies and confirms its obligations under the Loan Documents, as of the date
of the foregoing Amendment.
ENHANCED SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Chief Financial Officer
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