Document:

Twenty First Amendment to Loan and Security Agreement

 Exhibit 10.40 
 September 23, 2009 
 Flanders Corporation 
 Flanders/Precisionaire Corp. 
 Flanders Filters,
Inc. 
 Flanders/CSC Corporation 
 Precisionaire, Inc. 
 Precisionaire of Utah, Inc. 
 Eco-Air Products, Inc. 
 Air Seal Filter Housings, Inc. 
 Flanders Realty Corp. 
 531 Flanders Filters Road

 Washington, North Carolina 27889 
 Attention: John Oakley 
  

	 	RE:	Twenty-First Amendment to Loan and Security Agreement 

 Ladies and Gentlemen: 
 Reference is made to that certain Loan and Security Agreement dated October 18, 2002 (as
at any time amended, restated, modified or otherwise supplemented, the “Loan Agreement”), by and among Flanders Corporation, a North Carolina corporation (“Flanders”), Flanders/Precisionaire Corp., a North Carolina corporation
(“Flanders/Precisionaire”), Flanders Filters, Inc., a North Carolina corporation (“Filters”), Flanders/CSC Corporation, a North Carolina corporation (“CSC”), Precisionaire, Inc., a Florida corporation
(“Precisionaire”), Precisionaire of Utah, Inc., a Utah corporation (“Utah”), Eco-Air Products, Inc., a California corporation (“Eco-Air”), Air Seal Filter Housings, Inc., a Texas corporation (“Air Seal”), and
Flanders Realty Corp., a North Carolina corporation (“Flanders Realty”; Flanders, Flanders/Precisionaire, Filters, CSC, Precisionaire, Utah, Eco-Air, Air Seal and Flanders Realty are herein referred to collectively as “Borrowers”
and each individually as a “Borrower”), and Bank of America, N.A., a national banking association (together with its successors and assigns, “Lender”). Each capitalized term used herein, unless otherwise defined herein, shall
have the meaning ascribed to such term in the Loan Agreement. 
 Borrowers have advised Lender that Borrowers desire to
repurchase up to 30,000 shares of Equity Interests of Flanders held by certain shareholders (such transaction is referred to herein as the “Flanders Stock Repurchase”). Because Borrowers are prohibited by Section 9.2.7 of the
Loan Agreement from purchasing, redeeming or otherwise acquiring or retiring for value any Equity Interests of Flanders unless made contemporaneously from the net proceeds of the sale of Equity Interests of Flanders, Borrowers request that Lender
consent to the Flanders Stock Repurchase. Borrowers also request that Lender agree to amend the definition of “Inventory Formula Amount” contained in Appendix A to the Loan Agreement. Lender is willing to consent to the Flanders
Stock Repurchase and amend the Loan Agreement, subject to the terms and conditions contained herein. 
 NOW, THEREFORE, for TEN
DOLLARS ($10.00) in hand paid and other good and valuable consideration, the receipt and sufficiency of which are hereby severally acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows: 
 1. Consent to the Flanders Stock Repurchase. Lender hereby consents to the Flanders Stock
Repurchase, subject to the satisfaction of each of the following conditions precedent, each in form and substance satisfactory to Lender: (a) no Default or Event of Default shall exist at the time of the Flanders Stock Repurchase or after
giving effect thereto; (b) the Flanders Stock Repurchase shall be fully consummated on or within thirty (30) days after the date hereof; and (c) Flanders shall not pay more than the market price for Equity Interests of Flanders as
traded and determined on the NASDAQ stock exchange on the date it repurchases such Equity Interests. 

 2. Amendments to Loan Agreement. The Loan Agreement is hereby amended as
follows: 
 (a) By deleting the definition of “Inventory Formula Amount” contained in Appendix A to the
Loan Agreement and by substituting the following new definition in lieu thereof, in proper alphabetical sequence: 
 Inventory Formula Amount - on any date of determination thereof, an amount equal to the lesser of (i) $17,000,000 or (ii) the sum of (a) 85% of the NOLV Percentage of the Value of Eligible Inventory consisting of raw
materials or finished goods plus (b) the lesser of (I) $500,000 or (II) 45% of the Value of Eligible Inventory on such date consisting of Eligible In-Transit Inventory. 
 (b) By adding the following new definition of “NOLV Percentage” to Appendix A to the Loan Agreement, in proper
alphabetical sequence: 
 NOLV Percentage - the net orderly liquidation value of Inventory, expressed as a
percentage, expected to be realized at an orderly, negotiated sale held within a reasonable period of time, net of all liquidation expenses, as determined from the most recent appraisal of Borrowers’ Inventory performed by an appraiser and on
terms satisfactory to Lender. 
 3. Acknowledgments and Stipulations. By its signature below, each Borrower
acknowledges and stipulates that the Loan Agreement and the other Loan Documents executed by such Borrower are legal, valid and binding obligations of such Borrower that are enforceable against such Borrower in accordance with the terms thereof; all
of the Obligations are owing and payable without defense, offset or counterclaim (and to the extent there exists any such defense, offset or counterclaim on the date hereof, the same is hereby waived by such Borrower); and the security interests and
liens granted by such Borrower in favor of Lender are duly perfected, first priority security interests and liens. 
 4.
No Novation, etc. Except as expressly set forth herein, nothing in this letter amendment shall be deemed to amend or modify any provision of the Loan Agreement or any of the other Loan Documents, each of which shall remain in full force
and effect. This letter amendment is not intended to be, nor shall it be construed to create, a novation or accord and satisfaction, and the Loan Agreement as herein modified shall continue in full force and effect. 
 5. Additional Inducements. As inducement to Lender to enter into this letter amendment, each Borrower covenants and agrees
with Lender that such Borrower will promptly reimburse Lender for all costs and expenses (including, without limitation, legal fees) incurred by Lender in connection with this letter amendment and any of the matters herein described. 

 6. Miscellaneous. This letter amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. This letter amendment may be executed in any number of counterparts and by different parties to this letter amendment on separate counterparts, each of which, when so
executed, shall be deemed an original, but all such counterparts shall constitute one and the same amendment. Any signature delivered by a party by facsimile or electronic transmission shall be deemed to be an original signature hereto. This letter
amendment and the other Loan Documents, unless otherwise specified, shall be governed by the laws of the State of Georgia, without giving effect to any conflict of law principles (but giving effect to federal laws relating to national banks). Each
Borrower agrees to take such further actions as Lender shall reasonably request from time to time in connection herewith to evidence or give effect to the terms and provisions set forth herein or any of the transactions contemplated hereby.
Section titles and references used in this letter amendment shall be without substantive meaning or content of any kind whatsoever and are not a part of the agreements among the parties hereto. 
 7. Release of Claims. To induce Lender to enter into this letter amendment, each Borrower hereby releases, acquits and forever
discharges Lender, and all officers, directors, agents, employees, successors and assigns of Lender, from any and all liabilities, claims, demands, actions or causes of action of any kind or nature (if there be any), whether absolute or contingent,
disputed or undisputed, at law or in equity, or known or unknown, that such Borrower now has or ever had against Lender arising under or in connection with any of the Loan Documents or otherwise. Each Borrower represents and warrants to Lender that
such Borrower has not transferred or assigned to any Person any claim that such Borrower ever had or claimed to have against Lender. 
 [Remainder of page intentionally left blank; 
 signatures begin on following page.]

 If this letter amendment is acceptable to Borrowers, please evidence each Borrower’s
agreement with the terms hereof by executing and returning this letter amendment to Lender. 
  

			
	Very truly yours,
	
	BANK OF AMERICA, N.A.
	(“Lender”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 [Signatures continued on following page.] 
 Twenty-First Amendment to Loan
and Security Agreement 

			
	FLANDERS CORPORATION
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	FLANDERS/PRECISIONAIRE CORP.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	FLANDERS FILTERS, INC.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	FLANDERS/CSC CORPORATION
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	PRECISIONAIRE, INC.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	PRECISIONAIRE OF UTAH, INC.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	ECO-AIR PRODUCTS, INC.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 [Signatures continue on following page.] 
 Twenty-First Amendment to Loan and Security Agreement

			
	AIR SEAL FILTER HOUSINGS, INC.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	FLANDERS REALTY CORP.
	(“Borrower”)
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 Twenty-First Amendment to Loan and Security AgreementForm of Calix, Inc.'s Common Stock Certificate

 Exhibit 4.1 

 

 

 COMMON STOCK 
 NUMBER 
 CALX 0001 
 INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE 
 CALIX 
 COMMON STOCK 
 SHARES 
 SEE REVERSE FOR CERTAIN DEFINITIONS 
 CUSIP 13100M 50 9 
 This Certifies that 

is the record holder of 
 COUNTERSIGNED AND REGISTERED 
 MELLON INVESTOR
SERVICES LLC 
 TRANSFER AGENT AND REGISTRAR BY: 
 AUTHORIZED SIGNATURE 
 FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK, $0.025 PAR VALUE PER SHARE, OF 
 CALIX NETWORKS, INC 
 transferable on the books of
the Corporation by the holder hereof in person or by duly authorized attorney upon the surrender of this certificate properly endorsed. This Certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar.

 WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.

 Dated: 
 SECRETARY 
 PRESIDENT AND CHIEF EXECUTIVE OFFICER

 CALIX NETWORKS, INC 
 CORPORATE 
 SEAL 
 AUGUST 17 
 1999 
 DELAWARE 
 © NORTHERN BANK NOTE COMPANY 

 CALIX, INC 
 The Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional, or other special rights of each class of stock
or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Such requests shall be made to the Corporations’s Secretary at the principal office of the Corporation. 
  
  
 The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations:

  

													
	TEN COM-	  	as tenants in common	  		  	UNIF GIFT MIN ACT-	 	 	  	Custodian	  	 
		  		  		  		 	(Cust)	  		  	(Minor)
	TEN ENT-	  	as tenants by the entireties	  		  		 	under Uniform Gifts to Minors	  		  	
					
	JT TEN-	  	as joint tenants with	  	                        	  		 	Act __________________________________________________
		  	right of survivorship and	  		  		 	(State)      
		  	not as tenants in common	  		  	UNIF TRF MIN ACT-	 	 	  	Custodian (until age                     )
		  		  		  		 	(Cust)	  		  	
		  		  		  		 	 	  	under Uniform Transfers
		  		  		  		 	(Minor)	  		  	
					
		  		  		  		 	to Minors Act                                   
                                         
       
		  		  		  		 		  	(State)                            

  
  

			
	Additional abbreviations may also be used though not in the above list.
	
	 FOR VALUE RECEIVED, ___________________________________________ hereby sell, assign and transfer(s) unto

	  

		
	 PLEASE INSERT SOCIAL SECURITY OR
 OTHER IDENTIFYING NUMBER OF ASSIGNEE
	  	
	 	  	
	 	  	
	
	  

	(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE OF ASSIGNEE)
	
	  

	
	  

	
	___________________________________________________________________________________________________ Shares
	of the Common Stock represented by the within Certificate, and do(es) hereby irrevocably constitute and appoint
	
	________________________________________________________________________________________________ Attorney
	to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.

  

											
	Dated	 	  
	 		 	×	 	  

		 		 		 		 	×	 	  

	SIGNATURE(S) GUARANTEED:	 		 		 	NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(s) AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR
ANY CHANGE WHATEVER.
					
	By	 	  
	 		 		 	
		 	THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION, (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.	 		 		 	

  
  
  

KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR DESTROYED THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE
ISSUANCE OF A REPLACEMENT CERTIFICATE.

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