ex10-1mar09q.htm


     

    EXHIBIT
10.1

     

    
 

    AMENDMENT NUMBER FOUR TO
CREDIT AGREEMENT

     

    This
Amendment Number Four to Credit Agreement (“Amendment”) is
entered into as of March 1, 2009, by and among the lenders identified on
the signature pages hereof (such lenders, together with their respective
successors and permitted assigns, are referred to hereinafter each individually
as a “Lender”
and collectively as the “Lenders”), and WELLS
FARGO FOOTHILL, INC., a California corporation, as the arranger and
administrative agent for the Lenders (in such capacity, together with its
successors and assigns in such capacity, “Agent”), on the one
hand, and TELTRONICS, INC., a Delaware corporation (“Borrower”), on the
other hand, with reference to the following facts:

     

    A.    Borrower,
Agent, and Lenders have previously entered into that certain Credit Agreement,
dated as of May 31, 2007 (as amended and modified, from time to time, the “Agreement”).

     

    B.    Borrower
has requested that Agent and Lenders make certain amendments to the Agreement as
provided for and on the conditions set forth herein.

     

    NOW,
THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby amend and supplement the Agreement as
follows:

     

    1.    DEFINITIONS.  All initially
capitalized terms used in this Amendment shall have the meanings given to them
in the Agreement unless specifically defined herein.

     

    2.    AMENDMENT.  The
definition of “Eligible Accounts” set forth in Schedule 1.1 to the
Agreement is hereby amended by deleting subparagraph (a) therefrom in its
entirety and replacing it with the following:

     

    (a)            Accounts
that the Account Debtor has failed to pay within 90 days (120 days if the
Account Debtor is either the New York City Board of Education or the New York
City Department of Corrections, or their respective Affiliates) of original
invoice date or Accounts with selling terms of more than 60 days; provided, however, that
notwithstanding the foregoing, (i) solely during the period commencing on March
1, 2009 and ending on April 15, 2009, up to $1,000,000 of Accounts owed by the
New York City Board of Education and the New York City Department of
Corrections, and their respective Affiliates, and (ii) on and after April 16,
2009, up to $300,000 of Accounts owed by the New York City Board of Education
and the New York City Department of Corrections, and their respective
Affiliates, not otherwise fulfilling the terms in this subparagraph (a) shall be
considered Eligible Accounts so long as such Accounts (x) have selling terms of
60 days or less, (y) are no older than 180 days from their invoice date, and (z)
meet all other eligibility criteria set forth in this definition,

     

    3.    INTENTIONALLY
OMITTED.

     

    4.    INTENTIONALLY
OMITTED.

     

    5.    REPRESENTATIONS
AND WARRANTIES.  Borrower hereby
affirms to Agent and Lenders that all of Borrower’s representations and
warranties set forth in the Agreement are true, complete and accurate in all
respects as of the date hereof.

     

    6.    NO
DEFAULTS.  Borrower hereby
affirms to Agent and Lenders that no Event of Default has occurred and is
continuing as of the date hereof.

     


    
      
        
          BN 2687798v1
                                                                    


        

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    7.    CONDITIONS
PRECEDENT.  The effectiveness
of this Amendment is hereby conditioned upon receipt by Agent of a fully
executed copy of this Amendment from each party hereto, in form and substance
satisfactory to Agent.

     

    8.    REAFFIRMATION.  Borrower hereby
acknowledges and reaffirms (i) all of its obligations and duties under the Loan
Documents, and (ii) that the Agent, for the ratable benefit of the Lender Group,
has and shall continue to have valid, perfected Liens in the Collateral as
provided in Section
5.2(d) of the Security Agreement.

     

    9.    COSTS AND
EXPENSES.  Borrower shall
pay to Agent and Lenders all of Agent’s and Lenders’ out-of-pocket costs and
expenses (including, without limitation, the fees and expenses of its counsel,
which counsel may include any local counsel deemed necessary, search fees,
filing and recording fees, documentation fees, appraisal fees, travel expenses,
and other fees) arising in connection with the preparation, execution, and
delivery of this Amendment and all related documents.

     

    10.    LIMITED
EFFECT.  In the event of a
conflict between the terms and provisions of this Amendment and the terms and
provisions of the Agreement, the terms and provisions of this Amendment shall
govern.  In all other respects, the Agreement, as amended and
supplemented hereby, shall remain in full force and effect.

     

    11.    GENERAL
RELEASE.  IN CONSIDERATION OF AGENT AND LENDERS AGREEING TO
ENTER INTO THIS AMENDMENT AND FOR OTHER GOOD AND VALUABLE CONSIDERATION,
BORROWER HEREBY RELEASES AND DISCHARGES AGENT AND LENDERS, THEIR AGENTS,
REPRESENTATIVES, OFFICERS, DIRECTORS, AND ASSIGNS, FROM ANY AND ALL CLAIMS,
LIABILITIES, RIGHTS AND OBLIGATIONS, OF ANY NATURE WHATSOEVER, WHETHER SOUNDING
IN TORT OR CONTRACT, ARISING PRIOR TO THE DATE HEREOF RELATING TO THE
OBLIGATIONS, THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY. THIS
RELEASE SHALL BE EFFECTIVE NOTWITHSTANDING, AND BORROWER HEREBY WAIVES ANY AND
ALL RIGHTS ARISING UNDER OR WITH RESPECT TO, CALIFORNIA CIVIL CODE SECTION 1542
(OR ANY NEW YORK LAW EQUIVALENT) WHICH PROVIDES:

     

    “A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR.”

     

    12.    COUNTERPARTS;
EFFECTIVENESS.
This Amendment may be executed in any number of counterparts and by
different parties on separate counterparts, each of which when so executed and
delivered shall be deemed to be an original.  All such counterparts,
taken together, shall constitute but one and the same Amendment.  This
Amendment shall become effective upon the execution of a counterpart of this
Amendment by each of the parties hereto.  This Amendment is a Loan
Document and is subject to all the terms and conditions, and entitled to all the
protections, applicable to Loan Documents generally.

     

    [remainder of page left blank
intentionally; signatures to follow]


    
      
        
          BN 2687798v1
                                                                    


        

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    IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date
first set forth above.

     

     

    
 

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	 
      	
                                                TELTRONICS,
      INC.,

                                                a
      Delaware corporation

                                              
	 
      	 
      	 
      
	 
      	
                                                By:

                                              	
                                                /s/
      Angela L. Marvin

                                              
	 
      	
                                                Name:

                                              	
                                                Angela
      L. Marvin

                                              
	 
      	
                                                Title:

                                              	
                                                CFO

                                              
	 
      	 
      	 
      
	 	 	 
	 
      	 
      	 
      
	 
      	
                                                WELLS
      FARGO FOOTHILL, INC.,

                                                a
      California corporation,

                                                as
      Agent and Lender

                                              
	 
      	 
      	 
      
	 
      	
                                                By:

                                              	
                                                /s/
      Tiffany Ormon

                                              
	 
      	
                                                Name:

                                              	
                                                Tiffany
      Ormon

                                              
	 
      	
                                                Title:

                                              	
                                                Vice
      President

                                              


                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

     

     

     

     

     

    
      S-1

      Amendment
Number Four