Exhibit 10.1

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

This First Amendment to Credit Agreement (this “Amendment”) is made effective as
of this 24th day of June, 2018 (the “First Amendment Effective Date”), by and
among RIBBON COMMUNICATIONS INC., a Delaware corporation (“Holdings”), SONUS
NETWORKS, INC., a Delaware corporation (the “Borrower”), the Guarantors party
hereto, the lenders identified on the signature pages hereto (the “Lenders”),
SILICON VALLEY BANK (“SVB”), as administrative agent (in such capacity, the
“Administrative Agent”), and SVB, as Issuing Lender and Swingline Lender.

 

In consideration of the mutual covenants herein contained and benefits to be
derived herefrom:

 

WITNESSETH:

 

WHEREAS, reference is made to that certain Credit Agreement dated as of
December 21, 2017 (as amended, amended and restated, supplemented, restructured
or otherwise modified, renewed or replaced from time to time, the “Credit
Agreement”), by and among, Holdings, the Borrower, the Lenders, the Issuing
Lender and the Administrative Agent.  All capitalized terms used herein and not
otherwise defined herein, shall have the meanings assigned to such terms in the
Credit Agreement;

 

WHEREAS, the parties to the Credit Agreement have agreed to modify and amend
certain terms and conditions of the Credit Agreement, subject to the terms and
conditions of this Amendment.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

1.                                      Amendments to Section 1.1 of the Credit
Agreement.

 

a.                                      Immediately following the consummation
of the Edgewater Acquisition, the last sentence of the definition of
“Consolidated Adjusted EBITDA” shall automatically be amended and restated as
follows:

 

“Notwithstanding the foregoing, (i) for any twelve-month period ending after
September 30, 2017, the aggregate amount of all addbacks pursuant to clauses
(b)(vii), (b)(viii), (b)(ix), (b)(x), (b)(xiii), and (b)(xiv) shall not exceed
the higher of (A) $5,000,000 (or $8,000,000 for the twelve month periods ending
September 30, 2018 and December 31, 2018) and (B) 10% of Consolidated Adjusted
EBITDA (calculated prior to giving effect to any of the add-backs described in
this sentence) (such limit, the “10% Cap”), and (ii) Consolidated Adjusted
EBITDA for the fiscal quarter ending (A) March 31, 2017 shall be deemed to be
($11,070,000), (B) June 30, 2017, shall be deemed to be $2,984,000, and
(C) September 30, 2017 shall be deemed to be $19,835,000, and (D) December 31,
2017 shall be calculated  (x) for October 2017, based on the Borrower and its
Subsidiaries and GENBAND Holdings and its Subsidiaries in a manner consistent
with the methodology set forth in clauses (A) through (C) immediately above and

 

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(y) based on November 2017 and December 2017 for Holdings and its Subsidiaries.”

 

b.                                      The definition of “Specified Swap
Agreement” is hereby amended by deleting “in respect of interest rates.”

 

c.                                       The following new definitions are
hereby added to Section 1.1 of the Credit Agreement in the appropriate
alphabetical order:

 

““Edgewater Acquisition”: the acquisition by the Borrower of 100% of the Capital
Stock of Edgewater Networks, Inc. and its Subsidiaries pursuant to the Edgewater
Acquisition Documents, without any amendment thereto or waiver of any conditions
therein that could reasonably be expected to be materially adverse to the
interests of the Secured Parties.

 

““Edgewater Acquisition Documents”: the Agreement and Plan of Merger dated as of
June 24, 2018 by and among Holdings, Kansas Merger Sub, Inc., Edgewater
Networks, Inc. and Shareholder Representative Services LLC, as the initial
Holder Representative, and the other material documents and agreements entered
into in connection therewith.”

 

2.                                      Amendments to Section 7.1 of the Credit
Agreement.  Section 7.1(c) of the Credit Agreement is hereby amended by adding
the following proviso to the end thereof:

 

“provided that, immediately following the consummation of the Edgewater
Acquisition, the table above shall be automatically superseded by the following
table:

 

Four Fiscal Quarter Period Ending

 

Maximum Consolidated Leverage
Ratio

December 31, 2017

 

2.75:1.00

March 31, 2018

 

2.50:1.00

June 30, 2018

 

2.50:1.00

September 30, 2018

 

3.50:1.00

December 31, 2018

 

2.50:1.00

March 31, 2019

 

2.50:1.00

June 30, 2019

 

2.50:1.00

September 30, 2019 and each fiscal quarter ending thereafter

 

2.00:1.00”.

 

3.                                      Amendments to Section 7.3(l) of the
Credit Agreement.  Section 7.3(l) of the Credit Agreement is hereby amended by
deleting “3,500,000” and inserting “$7,000,000” in lieu thereof.

 

4.                                      Amendments to Section 7.8(n)(xii) of the
Credit Agreement.  Section 7.8(n)(xii) of the Credit Agreement is hereby amended
by inserting the following proviso to the end thereof:

 

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“; provided that the cash consideration payable in connection with the Edgewater
Acquisition shall be excluded from the limitations set forth in clauses (A) and
(B) above so long as the total cash consideration (including Deferred Payment
Obligations, but excluding working capital adjustments in accordance with the
terms of the Edgewater Acquisition Documents) in respect thereof does not exceed
$50,000,000 on the closing date of the Edgewater Acquisition and $30,000,000 in
deferred cash consideration (it being agreed that nothing contained herein shall
be deemed to be a consent to the Edgewater Acquisition);”.

 

5.                                      Conditions Precedent to Effectiveness. 
This Amendment shall not be effective until each of the following conditions
precedent has been fulfilled to the satisfaction of the Administrative Agent:

 

a.                                      This Amendment shall have been duly
executed and delivered by the respective parties hereto.

 

b.                                      All necessary consents and approvals to
authorize this Amendment shall have been obtained by the applicable Loan
Parties.

 

c.                                       The Administrative Agent shall have
received, for the benefit of the Lenders, a fee in the aggregate amount of 0.25%
of the aggregate amount of the Total Commitments, which fee shall be fully
earned when paid and shall not be refundable under any circumstances.

 

d.                                      No Default or Event of Default shall
have occurred and be continuing immediately after giving effect to this
Amendment.

 

e.                                       After giving effect to this Amendment,
the representations and warranties herein and in the Credit Agreement and the
other Loan Documents shall be, (i) to the extent qualified by materiality, true
and correct in all respects, and (ii) to the extent not qualified by
materiality, true and correct in all material respects, in each case, on and as
of the date hereof, as though made on and as of such date (except to the extent
that such representations and warranties expressly relate to an earlier date, in
which case they shall be true and correct in all respects or all material
respects, as applicable, as of such earlier date).

 

f.                                        As of the First Amendment Effective
Date, there shall not have occurred since December 31, 2017, any event or
condition that has had or could be reasonably expected to have, individually or
in the aggregate, a Material Adverse Effect.

 

g.                                       As of the First Amendment Effective
Date, no litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of any Group Member,
threatened, that could reasonably be expected to have a Material Adverse Effect.

 

h.                                      The Administrative Agent shall have
received a true and complete copy of the Edgewater Acquisition Documents, which
shall be in form and substance reasonably satisfactory to the Administrative
Agent.

 

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6.                                      Representations and Warranties.  Each
Loan Party hereby represents and warrants to the Administrative Agent and the
Lenders as follows:

 

a.                                      This Amendment is, when executed and
delivered by each Loan Party (or acknowledged by such Loan Party, as
applicable), the legally valid and binding obligation of such Loan Party,
enforceable against such Loan Party in accordance with its respective terms,
except as enforcement may be limited by equitable principles or by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors’ rights generally.

 

b.                                      The representations and warranties set
forth in this Amendment, the Credit Agreement, as amended by this Amendment and
after giving effect hereto, and the other Loan Documents (including the
Guarantee and Collateral Agreement) to which it is a party are, (i) to the
extent qualified by materiality, true and correct in all respects, and (ii) to
the extent not qualified by materiality, true and correct in all material
respects, in each case, on and as of the date hereof, as though made on such
date (except to the extent that such representations and warranties expressly
relate to an earlier date, in which case they shall be true and correct in all
respects or all material respects, as applicable, as of such earlier date).

 

c.                                       The execution, delivery, and
performance of this Amendment (i) have been duly authorized by all necessary
organizational or other corporate action of the Loan Parties, and (ii) do not
and will not (A) violate any material Requirement of Law binding on any Group
Member, (B) violate any material Contractual Obligation of any Group Member,
except to the extent that any such violation would not individually or in the
aggregate reasonably be expected to have a Material Adverse Effect, (C) result
in, or require, the creation or imposition of any Lien upon any properties or
assets of any Group Member other than Liens created by the Security Documents
and Liens permitted under the Credit Agreement, or (D) require any approval of
any Group Member’s interestholders or any approval or consent of any Person
under any material Contractual Obligation of any Group Member, other than
consents or approvals that have been obtained or made and that are still in
force and effect and except, in the case of material Contractual Obligations,
for consents or approvals, the failure of which to obtain would not individually
or in the aggregate reasonably be expected to have a Material Adverse Effect on
the Group Members.

 

7.                                      Choice of Law; Submission to
Jurisdiction.  This Amendment and the rights of the parties hereunder, shall be
determined under, governed by, and construed in accordance with the laws of the
State of New York.  Section 10.14 of the Credit Agreement is hereby incorporated
by reference.

 

8.                                      Counterpart Execution.  This Amendment
may be executed in any number of counterparts, all of which when taken together
shall constitute one and the same instrument, and any of the parties hereto may
execute this Amendment by signing any such counterpart.  Delivery of an executed
counterpart of this Amendment by telefacsimile or other electronic method of
transmission shall be equally as effective as delivery of an original executed
counterpart of this Amendment.  Any party delivering an executed counterpart of
this Amendment by

 

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telefacsimile or other electronic method of transmission also shall deliver an
original executed counterpart of this Amendment, but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Amendment.

 

9.                                      Effect on Loan Documents.

 

a.                                      The Credit Agreement, as amended hereby,
and each of the other Loan Documents shall be and remain in full force and
effect in accordance with their respective terms and hereby are ratified and
confirmed in all respects.  The execution, delivery, and performance of this
Amendment shall not operate, except as expressly set forth herein, as a
modification or waiver of any right, power, or remedy of the Administrative
Agent or any Lender under the Credit Agreement or any other Loan Document. 
Except as expressly set forth herein, this Amendment shall not excuse any
non-compliance with the Loan Documents, nor operate as a consent or waiver to
any matter under the Loan Documents.  Except for the amendments to the Credit
Agreement expressly set forth herein, the Credit Agreement and other Loan
Documents shall remain unchanged and in full force and effect.  To the extent
any terms or provisions of this Amendment conflict with those of the Credit
Agreement or other Loan Documents, the terms and provisions of this Amendment
shall control.

 

b.                                      To the extent that any terms and
conditions in any of the Loan Documents shall contradict or be in conflict with
any terms or conditions of the Credit Agreement, after giving effect to this
Amendment, such terms and conditions are hereby deemed modified or amended
accordingly to reflect the terms and conditions of the Credit Agreement, as
modified or amended hereby.

 

c.                                       This Amendment is a Loan Document.

 

10.                               Payment of Costs and Fees.  The Borrower shall
pay to the Administrative Agent all costs and all reasonable out-of-pocket
expenses in connection with the preparation, negotiation, execution and delivery
of this Amendment and any documents and instruments relating hereto (which costs
include, without limitation, the reasonable fees and expenses of outside counsel
retained by Administrative Agent), in each case, as set forth in Section 10.5 of
the Credit Agreement.

 

11.                               Acknowledgement of Obligations.  The Loan
Parties acknowledge that on and as of the First Amendment Effective Date, all
Obligations are payable without defense, offset, counterclaim or recoupment. 
Each of the Loan Parties, the Administrative Agent, the Issuing Lender and
Swingline Lender and each other Lender party hereto does hereby adopt, ratify,
and confirm the Credit Agreement, as amended hereby, and acknowledges and agrees
that the Credit Agreement, as amended hereby, is and remains in full force and
effect, and the Borrower acknowledges and agrees that their Obligations under
the Credit Agreement, as amended hereby, are not impaired in any respect by this
Amendment.

 

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12.                               Entire Agreement.  This Amendment, and terms
and provisions hereof, the Credit Agreement and the other Loan Documents
constitute the entire understanding and agreement among the parties hereto with
respect to the subject matter hereof and supersedes any and all prior or
contemporaneous amendments or understandings with respect to the subject matter
hereof, whether express or implied, oral or written.

 

13.                               Reaffirmation.  Each Loan Party hereby
reaffirms its obligations under each Loan Document to which it is a party.  Each
Loan Party hereby further ratifies and reaffirms the validity and enforceability
(except as enforceability may be limited by bankruptcy, insolvency, or similar
laws affecting creditors’ rights generally and general principles of equity) of
all of the Liens heretofore granted, pursuant to and in connection with the
Guaranty and Collateral Agreement or any other Loan Document to the
Administrative Agent on behalf and for the benefit of Secured Parties, as
collateral security for the obligations under the Loan Documents (including such
obligations as amended hereby) in accordance with their respective terms, and
acknowledges that all of such Liens, and all collateral heretofore pledged as
security for such obligations, continues to be and remain collateral for such
obligations from and after the date hereof.

 

14.                               Severability.  In case any provision in this
Amendment shall be invalid, illegal or unenforceable, such provision shall be
severable from the remainder of this Amendment and the validity, legality and
enforceability of the remaining provisions of this Amendment shall not in any
way be affected or impaired thereby.

 

[Signature pages follow]

 

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IN WITNESS WHEREOF, each of the undersigned has caused this First Amendment to
Credit Agreement to be duly executed and delivered by its proper and duly
authorized officer as of the date set forth below.

 

 

LOAN PARTIES:

 

 

 

RIBBON COMMUNICATIONS INC.,

 

as Holdings

 

 

 

 

 

By:

/s/ Daryl E. Raiford

 

Name:

Daryl E. Raiford

 

Title:

Executive Vice President & Chief Financial Officer

 

 

 

 

 

SONUS NETWORKS, INC.,

 

as Borrower

 

 

 

By:

/s/ Daryl E. Raiford

 

Name:

Daryl E. Raiford

 

Title:

President & Secretary

 

 

 

 

 

GENBAND US LLC,

 

as a Guarantor

 

 

 

By:

/s/ Daryl E. Raiford

 

Name:

Daryl E. Raiford

 

Title:

President & Chief Executive Officer

 

Signature Page to First Amendment to Credit Agreement

 

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ADMINISTRATIVE AGENT:

 

 

 

SILICON VALLEY BANK

 

 

 

By:

/s/ Ryan Thompson

 

Name:

Ryan Thompson

 

Title:

Vice President

 

Signature Page to First Amendment to Credit Agreement

 

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LENDERS:

 

 

 

SILICON VALLEY BANK,

 

as Issuing Lender, Swingline Lender and as a Lender

 

 

 

By:

/s/ Ryan Thompson

 

Name:

Ryan Thompson

 

Title:

Vice President

 

Signature Page to First Amendment to Credit Agreement

 

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PACIFIC WESTERN BANK,

 

as a Lender

 

 

 

By:

/s/ Stephen J. Besus

 

Name:

Stephen J. Besus

 

Title:

Senior Vice President

 

Signature Page to First Amendment to Credit Agreement

 

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CADENCE BANK, N.A.,

 

as a Lender

 

 

 

By:

/s/ Henry Farley

 

Name:

Henry Farley

 

Title:

Vice President

 

Signature Page to First Amendment to Credit Agreement

 

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JPMORGAN CHASE BANK, N.A.,

 

as a Lender

 

 

 

By:

/s/ Min Park

 

Name:

Min Park

 

Title:

Vice President

 

Signature Page to First Amendment to Credit Agreement

 

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