Letterhead of GE Capital Commercial Finance, Inc.
October 9, 2000
Tammy Marie Powers, Vice President/CFO
Vodavi Communications Systems, Inc.
8300 East Raintree Drive
Scottsdale, Arizona 85260
RE: Amendment of Loan Agreement to: 1) Extend stock repurchase period,
2) Require quarterly cash flow statements, not monthly and 3) Require
quarterly submission of Exhibit P (Form of Certificate of Compliance).
Dear Tammy:
This letter is written in response to your request for an amendment of the Use
of Proceeds as defined under Section 7.12, and an amendment of Reports and
Notices as defined under Article 5.1(d) of the Credit Agreement dated April 11,
1994 (as amended and restated as of June 11, 1997) between Vodavi Communications
Systems, Inc. ("Borrower") and General Electric Capital Corporation as Lender
and agent for Lender.
Retroactive to June 30, 2000, SECTION 7.12 of the Credit Agreement is hereby
amended by replacing it entirely 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, 2001 (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 purchase the Company
shall have unused Revolving Credit Advance Availability of not less
than $750,000."
Article 5.1(d) of the Credit Agreement is hereby amended by replacing it
entirely with the following:
"(d) Within 30 days after the end of each Fiscal Month, financial and
other information for such Fiscal Month for Borrower, certified by an officer of
Borrower, including, without limitation, an internally-prepared (i) statement of
income and balance sheet, (ii) sales analysis report; (iii) inventory/product
mix analysis, as well as a summary aged receivable trial balance (by payor
category), each of which shall be in form and in substance reasonably
satisfactory to lender and each of which shall provide comparisons to the
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internally prepared statement for the prior year's equivalent period and to
budget, (iv) at the end of each Fiscal Quarter only, a schedule in reasonable
detail showing the calculations used in determining Borrower's compliance with
the financial covenants set forth in Section 7.10, (v) a consolidating balance
sheet and cash flow statement and statement of income for the Parent Group and
(vi) the certification in the form of Exhibit P by the Chief Executive Officer
or Chief Financial Officer of Borrower that all such financial statements
delivered pursuant to clauses (i) and (v) above present fairly in accordance
with GAAP (subject to normal year-end audit adjustments and the absence of
footnotes) the financial position, the results of operations and the statements
of cash flow of Borrower as at the end of such month and for the period then
ended, that such information is complete and correct in all material respects as
of its date and that no Default exists;"
The amendment(s) set forth herein shall be limited precisely as provided for
herein to the provisions(s) expressly amended herein and shall not be deemed to
be a waiver of, amendment of, consent to or modification of any other term(s) or
provision(s) of any other document or of any transaction or further action on
the part of the Borrowers or the Guarantors which would require the consent of
Lenders under the Credit Agreement.
Please acknowledge your agreement to the amendment(s) below.
Sincerely,
/s/ Timothy J. Rafanello
Timothy J. Rafanello
Vice President
Attachment: Exhibit P, Form of Certificate of Compliance
Agreed to by:
Borrowers: Vodavi Communications Systems, Inc.
By: /s/ Tammy Powers
Its: CFO
Agent: General Electric Capital Corporation
By: /s/ Timothy J. Rafanello
Its: Duly Authorized Signatory
Lender: General Electric Capital Corporation
By: /s/ Timothy J. Rafanello
Its: Duly Authorized Signatory
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