Document:

<PAGE>

                                                           Executed in 6 Parts
                                                           Counterpart No. (   )

                              NATIONAL EQUITY TRUST

                        FORBES FORTY INDEX TRUST SERIES 6

                            REFERENCE TRUST AGREEMENT

     This Reference Trust Agreement dated May 16, 2001 among Prudential
Securities Incorporated, as Depositor and The Bank of New York, as Trustee, sets
forth certain provisions in full and incorporates other provisions by reference
to the document entitled "National Equity Trust, Trust Indenture and Agreement"
(the "Basic Agreement") dated February 2, 2000. Such provisions as are set forth
in full herein and such provisions as are incorporated by reference constitute a
single instrument (the "Indenture").

                                WITNESSETH THAT:
                                ---------------

     In consideration of the premises and of the mutual agreements herein
contained, the Depositor and the Trustee agree as follows:

                                     Part I.
                                     ------

                     STANDARD TERMS AND CONDITIONS OF TRUST

     Subject to the provisions of Part II hereof, all the provisions contained
in the Basic Agreement are herein incorporated by reference in their entirety
and shall be deemed to be a part of this instrument as fully and to the same
extent as though said provisions had been set forth in full in this instrument.

     A.   Article III, entitled "Administration of Trust," shall be amended as
follows:

     (i)  Section 3.14 Deferred Sales Charge shall be amended to add the
          following sentences at the end thereof:

<PAGE>

                                       -2-

                "References to Deferred Sales Charge in this Trust Indenture and
                 Agreement shall include any Creation and Development Fee
                 indicated in the prospectus for a Trust. The Creation and
                 Development Fee shall be payable on each date so designated and
                 in an amount determined as specified in the prospectus for a
                 Trust."

                                    Part II.
                                    -------

                      SPECIAL TERMS AND CONDITIONS OF TRUST

     The following special terms and conditions are hereby agreed to:

     A.   The Trust is denominated National Equity Trust, Forbes Forty Index
Trust Series 6.

     B.   The Units of the Trust shall be subject to a deferred sales charge.

     C.   The publicly traded stocks listed in Schedule A hereto are those
which, subject to the terms of this Indenture, have been or are to be deposited
in Trust under this Indenture as of the date hereof.

     D.   The term "Depositor" shall mean Prudential Securities Incorporated.

     E.   The aggregate number of Units referred to in Sections 2.03 and 9.01 of
the Basic Agreement is 125,000 as of the date hereof.

     F.   A Unit of the Trust is hereby declared initially equal to 1/125,000th
of the Trust.

     G.   The term "First Settlement Date" shall mean May 22, 2001.

     H.   The terms "Computation Day" and "Record Date" shall be on such dates
as the Sponsor shall direct.

     I.   The term "Distribution Date" shall be on such dates as the Sponsor
shall direct.

     J.   The term "Termination Date" shall mean June 20, 2002.

<PAGE>

                                       -3-

     K.   The Trustee's Annual Fee shall be $.90 (per 1,000 Units) for
49,999,999 and below units outstanding $.84 (per 1,000 Units) on the next
50,000,000 Units, $.78 (per 1,000 Units) on the next 100,000,000 Units, and $.66
(per 1,000 Units) on Units in excess of 200,000,000 Units. In calculating the
Trustee's annual fee, the fee applicable to the number of units outstanding
shall apply to all units outstanding.

     L.   The Depositor's Portfolio supervisory service fee shall be $.25 per
1,000 Units.

               [Signatures and acknowledgments on separate pages]

<PAGE>

                                       -4-

The Schedule of Portfolio Securities in Part A of the prospectus included in
this Registration Statement for National Equity Trust, Forbes Forty Index Trust
Series 6 is hereby incorporated by reference herein as Schedule A hereto.<PAGE>

                                                           Executed in 6 Parts
                                                           Counterpart No. (   )

                              NATIONAL EQUITY TRUST

                           OTC GROWTH TRUST SERIES 14

                            REFERENCE TRUST AGREEMENT

     This Reference Trust Agreement dated May 16, 2001 among Prudential
Securities Incorporated, as Depositor and The Bank of New York, as Trustee, sets
forth certain provisions in full and incorporates other provisions by reference
to the document entitled "National Equity Trust, Trust Indenture and Agreement"
(the "Basic Agreement") dated February 2, 2000. Such provisions as are set forth
in full herein and such provisions as are incorporated by reference constitute a
single instrument (the "Indenture").

                                WITNESSETH THAT:
                                ---------------

     In consideration of the premises and of the mutual agreements herein
contained, the Depositor and the Trustee agree as follows:

                                     Part I.
                                     ------

                     STANDARD TERMS AND CONDITIONS OF TRUST

     Subject to the provisions of Part II hereof, all the provisions contained
in the Basic Agreement are herein incorporated by reference in their entirety
and shall be deemed to be a part of this instrument as fully and to the same
extent as though said provisions had been set forth in full in this instrument.

     A.   Article III, entitled "Administration of Trust," shall be amended as
follows:

     (i)  Section 3.14 Deferred Sales Charge shall be amended to add the
          following sentences at the end thereof:

<PAGE>

                                       -2-

                "References to Deferred Sales Charge in this Trust Indenture and
                 Agreement shall include any Creation and Development Fee
                 indicated in the prospectus for a Trust. The Creation and
                 Development Fee shall be payable on each date so designated and
                 in an amount determined as specified in the prospectus for a
                 Trust."

                                    Part II.
                                    -------

                      SPECIAL TERMS AND CONDITIONS OF TRUST

The following special terms and conditions are hereby agreed to:

     A.   The Trust is denominated National Equity Trust, OTC Growth Trust
Series 14.

     B.   The Units of the Trust shall be subject to a deferred sales charge.

     C.   The publicly traded stocks listed in Schedule A hereto are those
which, subject to the terms of this Indenture, have been or are to be deposited
in Trust under this Indenture as of the date hereof.

     D.   The term "Depositor" shall mean Prudential Securities Incorporated.

     E.   The aggregate number of Units referred to in Sections 2.03 and 9.01 of
the Basic Agreement is 125,000 as of the date hereof.

     F.   A Unit of the Trust is hereby declared initially equal to 1/125,000th
of the Trust.

     G.   The term "First Settlement Date" shall mean May 22, 2001.

     H.   The terms "Computation Day" and "Record Date" shall be on such dates
as the Sponsor shall direct.

     I.   The term "Distribution Date" shall be on such dates as the Sponsor
shall direct.

     J.   The term "Termination Date" shall mean June 20, 2002.

<PAGE>

                                       -3-

     K.   The Trustee's Annual Fee shall be $.90 (per 1,000 Units) for
49,999,999 and below units outstanding $.84 (per 1,000 Units) on the next
50,000,000 Units, $.78 (per 1,000 Units) on the next 100,000,000 Units, and
$.66 (per 1,000 Units) on Units in excess of 200,000,000 Units. In calculating
the Trustee's annual fee, the fee applicable to the number of units outstanding
shall apply to all units outstanding.

     L.   The Depositor's Portfolio supervisory service fee shall be $.25 per
1,000 Units.

               [Signatures and acknowledgments on separate pages]

<PAGE>

                                       -4-

The Schedule of Portfolio Securities in Part A of the prospectus included in
this Registration Statement for National Equity Trust, OTC Growth Trust Series
14 is hereby incorporated by reference herein as Schedule A hereto.ASSET PURCHASE AGREEMENT

                                     BETWEEN

                              COMDIAL CORPORATION,

                          AMERICAN PHONE CENTERS, INC.

                                       AND

                             KING TECHNOLOGIES, INC.

                             Dated as of May 4, 2001

<PAGE>
                            ASSET PURCHASE AGREEMENT

                  This ASSET PURCHASE AGREEMENT (the  "Agreement"),  dated as of
May ,  2001,  is  made  between  COMDIAL  CORPORATION,  a  Delaware  corporation
("Comdial"),  AMERICAN PHONE CENTERS,  INC., a Delaware  corporation  which is a
wholly-owned  subsidiary of Comdial  ("Subsidiary")  (Comdial and Subsidiary are
collectively  referred  to as the  "Seller"),  and KING  TECHNOLOGIES,  INC.,  a
Tennessee corporation ("Buyer").

                                    RECITALS

                  WHEREAS,   Comdial  desires  to  sell,   directly  or  through
Subsidiary certain inventory related to the repair and maintenance of telephones
and keysystems,  certain equipment related to the repair and maintenance of such
telephones  and  keysystems,  certain  discontinued  and obsolete  telephone and
keysystems  inventory  and  Seller's  rights and goodwill in the trade names and
service marks associated therewith (the "Business"); and

                  WHEREAS,  Buyer desires to purchase certain assets relating to
the  Business  in  accordance  with the terms and  conditions  set forth in this
Agreement; and

                  WHEREAS,  simultaneously with the execution of this Agreement,
Seller and Buyer are entering into a Repair  Agreement (as herein defined) and a
Discontinued Product Agreement (as defined herein).

                  NOW,  THEREFORE,  in  consideration  of the  foregoing and the
representations,  warranties and agreements herein contained,  the parties agree
as follows:

                                   DEFINITIONS

                  1.1 Definitions. The following terms, as used herein, have the
following meanings:

                        "Closing" has the meaning set forth in Section 8.1.

                        "Closing Date" has the meaning set forth in Section 8.1.

                        "Discontinued Product Agreement" is an agreement between
the parties,  a copy of which is attached  hereto as Exhibit A, and is described
in Section 2.1.

                        "Encumbrances" has the meaning set forth in Section 3.6.

                        "Internal  Revenue Code" means the Internal Revenue Code
of 1986, as amended.

<PAGE>

                        "Legal Action" has the meaning set forth in Section 9.2.

                        "Liabilities"  shall mean, as to any Person,  all debts,
adverse claims, liabilities, commitments,  responsibilities,  and obligations of
any kind or nature whatsoever, direct, indirect, absolute or contingent, of such
Person,  whether  accrued,  vested or  otherwise,  whether  know or unknown  and
whether or not actually reflected, or required to be reflected, in such Person's
balance sheets or other books and records.

                        "Person"  shall mean an  individual,  a  partnership,  a
joint venture,  a corporation,  a business trust, a limited liability company, a
trust, an unincorporated  organization, a joint stock company, a labor union, an
estate, a governmental entity or any other entity.

                        "Purchased  Assets" has the meaning set forth in Section
2.1.

                        "Purchased Intellectual Property Rights" has the meaning
set forth in Section 2.1

                        "Purchase  Price" has the  meaning  set forth in Section
2.4.

                        "Repair  Agreement" is an agreement between the parties,
a copy of which is attached hereto as Exhibit B, and is described in Section 2.1

                        "Security  Agreement" is an agreement  between the Buyer
and Comdial, a copy of which is attached hereto as Exhibit C, in which the Buyer
grants Comdial a security interest in certain assets of the Buyer

                        "Survival  Date" has the  meaning  set forth in  Section
9.4.

                        "Tax" or "Taxes" shall mean any federal,  state, county,
local,  foreign and other income,  profits,  gains, net worth, sales and use, ad
valorem, gross receipts,  business and occupation,  license,  estimated,  stamp,
custom  duties,  occupation,  property  (real or personal),  franchise,  capital
stock,  license,  excise, value added, payroll,  employees,  income withholding,
social  security,  unemployment  or other tax, any penalty,  addition to tax and
interest on the foregoing.

                        "Transfer  Tax"  or  "Transfer  Taxes"  shall  mean  any
federal,   state,   county,  local  foreign  and  other  sales,  use,  transfer,
conveyance,  documentary transfer, recording or other similar tax, fee or charge
imposed  upon the sale,  transfer or  assignment  of  property  or any  interest
therein or the recording thereof,  and any penalty,  addition to tax or interest
with respect thereto,  but such term shall not include any tax on, based upon or
measured  by, the net  income,  gains or profits  from such  sale,  transfer  or
assignment of the property or any interest therein.

                                       2
<PAGE>

                                   ARTICLE II
                           PURCHASE AND SALE OF ASSETS

                  2.1  Purchase  and Sale of  Assets.  Subject  to the terms set
forth below,  Seller agrees to sell to Buyer,  and Buyer agrees to purchase from
Seller the following assets (the "Purchased Assets"):

                         (a) Certain  inventory  consisting of raw materials and
components  necessary for the phone and keysystem  repair and maintenance  which
inventory is described by type and quantity on Schedule  2.1(a)  attached hereto
(the "Purchased Inventory");

                         (b)  Certain   equipment  related  to  the  repair  and
maintenance of such phones and keysystems  which equipment is listed on Schedule
2.1(b) attached hereto (the "Purchased Equipment");

                         (c) Certain  inventory of discontinued  and/or obsolete
phones and keysystems which inventory is by type and quantity on Schedule 2.1(c)
attached hereto (the "Purchased Q Stock"); and

                         (d) All registered and unregistered  trademarks,  trade
names,  service marks,  service names and applications  therefore relating to or
associated  with  "American  Phone  Center"  together  with the  goodwill of the
Business  represented  by that mark and name,  and any and all  customer  lists,
"toll  free"  telephone  numbers  and  domain  names  used  in the  business  or
associated  with "American  Phone  Company," all of which are listed on Schedule
2.1(d) (the "Purchased Intellectual Property").

                  Certain  of the  Purchased  Assets  will be used by  Buyer  to
repair and maintain and/or provide in warranty and out of warranty  services for
certain telephones and keysystems provided by Seller pursuant a repair agreement
of even date herewith  executed by the parties hereto (the "Repair  Agreement").
Further,  Seller agrees to provide certain  discontinued and obsolete telephones
and keysystems to Buyer subsequent to Closing pursuant to a discontinued product
agreement  of  even  date  herewith   executed  by  the  parties   hereto  ("the
"Discontinued  Product  Agreement") (the Repair Agreement and Discounted Product
Agreement shall collectively be referred to as the "Service Agreements").

                  2.2 Time of purchase. Buyer will purchase all of the Purchased
Assets at Closing.

                  2.3  Purchase  Price.  The  total  purchase  price  ("Purchase
Price") for the Purchased Assets is One Million Four Hundred Thousand and 00/100
Dollars  ($1,400,000.00),  and the Purchase  Price shall be allocated  among the
Purchased Assets as follows:

                         (a) One  Hundred  Fifty  Thousand  and  00/100  Dollars
($150,000.00)  of the  Purchase  Price  shall  be  allocated  to  the  Purchased
Inventory;

                                       3
<PAGE>

                         (b)  One  Hundred  Thirty-Seven   Thousand  and  00/100
Dollars  ($137,000.00) of the Purchase Price shall be allocated to the Purchased
Equipment;

                         (c) One Million Sixty-Three Thousand and 00/100 Dollars
($1,063,000.00)  of the Purchase  Price shall be  allocated  to the  Purchased Q
Stock; and

                         (d) Fifty Thousand and 00/100 Dollars  ($50,000.00)  of
the Purchase Price shall be allocated to the Purchased Intellectual Property.

                  2.4 Payment of Purchase  Price.One  Million One Hundred  Fifty
Thousand and 00/100 Dollars  ($1,150,000.00) of the Purchase Price shall be paid
by the Buyer by delivery of a secured promissory note of the Buyer substantially
in the form of Exhibit D hereto (the "Note").  The balance of the Purchase Price
shall  be paid by the  Buyer  to the  Seller  by wire  transfer  of  immediately
available funds in the aggregate  amount equal to Two Hundred Fifty Thousand and
00/100 Dollars ($250,000.00) (the "Cash Purchase Price") .

                  2.5 Shipment  Terms.  Buyer shall pay for the cost of shipping
the   Purchased   Assets.   All  items   shall  be   shipped   F.O.B.   Seller's
Charlottesville, Virginia facility.

                  2.6 Removal of Purchased  Assets.  Buyer shall take control of
the Purchased Assets  immediately  following Closing and shall, on or before May
4, 2001 remove the Purchased Assets from the Seller's facility. Buyer shall only
be obligated to cap the electrical lines, gas lines and all compressor lines, if
any, at the machine disconnect.  Buyer shall not be responsible for cleaning the
Seller's  facility  or for removal of any items not  included  in the  Purchased
Assets. Buyer shall also not be responsible for damages to Seller resulting from
Buyer's  failure to remove the  Purchased  Assets from  Seller's  facility on or
before May 4, 2001 if such  failure is the result of actions  outside of Buyer's
control. Buyer shall be liable for any damages caused to any building,  facility
or  surrounding  docks,  land,  or  structure  as a result of Buyer's or Buyer's
agents negligence in the removal of the Purchased Assets.

                  2.7 Excluded  Liabilities.  Except as  otherwise  set forth in
this Agreement, Buyer shall not assume, and shall be deemed not to have assumed,
any Liabilities,  and Seller shall be solely and exclusively liable with respect
to  all  Liabilities  of  Seller  (collectively,  the  "Excluded  Liabilities"),
including, but not limited to, those Liabilities set forth below:

                         (a) Any Liabilities which arise,  whether before, on or
after the Closing which do not relate to the Business;

                         (b)  Any  Liabilities  resulting  from  any  agreement,
contract  with any vendor or  supplier,  unless  Buyer  expressly  assumes  such
liability in writing;

                         (c) Any Liabilities under any real or personal property
leases;

                         (d) Any  Liabilities  arising  out of or in  connection
with any  indebtedness  of Seller to any  lender or to any  vendors of goods and
services delivered or furnished to Seller;

                                       4
<PAGE>

                         (e)  Any  Liabilities  attributable,   to  incurred  in
connection  with,  arising  from,  or  relating  to, any  collective  bargaining
agreement, or any bonus, incentive, deferred compensation, medical, health, life
or other insurance,  welfare, fringe benefit, severance, vacation pay, sick pay,
termination, retention, consulting, change of control, employment, stock option,
stock appreciation  right, stock purchase,  phantom stock or other equity-based,
performance, pension, retirement or any other incentive, compensation or benefit
plan, program, policy agreement or arrangement  (including,  but not limited to,
any  "employee  benefit  plan" as defined in Section 3(3) of ERISA),  sponsored,
maintained,  contributed  to or  required  to be  contributed  to at any time by
Seller or any trade or business  which  together with Seller would be deemed (or
at any time would have been) a "single  employer"  within the meaning of Section
4001 of ERISA (each,  an "ERISA  Affiliate"),  for the benefit of any current or
former employee,  officer, director, agent or consultant of Seller, or any ERISA
Affiliate, whether formal or informal and whether legally binding or not; and

                         (f) Any  Liabilities for income Taxes of Seller and any
other Taxes of Seller, including, but not limited to, all Taxes attributable to,
incurred in  connection  with or arising out of the  operation  of the  Business
including  those which are not due or assessed until after the Closing but which
are  attributable  to any period (or  portion  thereof)  ending on or before the
Closing.

                                   ARTICLE III
                    REPRESENTATIONS AND WARRANTIES OF SELLER

                  Seller represents and warrants to Buyer the following:

                  3.1 Organization;  Qualification. Each Seller is a corporation
duly  organized,  validly  existing and in good  standing  under the laws of the
State of Delaware and has  corporate  power and  authority to own its assets and
conduct its  business as currently  conducted.  Subsidiary  is the  wholly-owned
subsidiary of Comdial. Subsidiary is qualified to transact business in the State
of  Virginia.  Comdial is the sole owner of all issued and  outstanding  capital
stock of the Subsidiary,  and no Person has the right to acquire any interest in
the  capital  stock  of the  Subsidiary.  There  are not any  existing  options,
warrants,  calls,   subscriptions  or  other  rights  or  agreements  obligating
Subsidiary to issue or sell any equity ownership interest in the Subsidiary.

                  3.2  Authority  Relative  to this  Agreement.  Each Seller has
corporate  power and  authority  to execute and deliver this  Agreement  and the
Service  Agreements and to consummate the transactions  contemplated  hereby and
thereby.  The  execution  and delivery by each Seller of this  Agreement and the
Service  Agreements and the consummation by it of the transactions  contemplated
hereby and thereby,  have been duly authorized by the Board of Directors of each
Seller  and no  other  corporate  proceedings  on the  part of each  Seller  are
necessary  with  respect  thereto.  This  Agreement  has been duly  executed and
delivered  by each Seller and this  Agreement  and the Service  Agreements  when
executed  and  delivered  by each  Seller,  will  constitute  valid and  binding
obligations of each Seller,  enforceable  against each Seller in accordance with
their terms.

                                       5
<PAGE>

                  3.3 No Violation. The execution and delivery by Seller of this
Agreement and the Service  Agreements and the  consummation of the  transactions
contemplated  hereby and thereby,  will not (i) violate or result in a breach of
any provision of the  Certificate of  Incorporation  or Bylaws of either Seller,
(ii) result in a default, or give rise to any right of termination, modification
or  acceleration,  or the  imposition of an  Encumbrance on any of the Purchased
Assets,  under the terms or provisions  of any agreement or other  instrument or
obligation to which either Seller is a party or by which either Seller or any of
the  Purchased  Assets are bound except for the lien of Bank of  American,  N.A.
(the "Bank")  pursuant to the Amended and Restated Credit  Agreement dated as of
November  22, 2000 and related  loan  documents  (the "Loan  Documents"),  which
Seller will cause to be released  at or prior to Closing,  or (iii)  violate any
law or regulation,  or any judgment, order or decree of any court,  governmental
body, commission, agency or arbitrator applicable to either Seller or any of the
Purchased Assets. The Seller has not violated, is not subject to any claim based
on,  has no  knowledge  of any action or threat of action  arising  under or any
employee's right to exercise such employee's rights under the Family and Medical
Leave Act of 1993 ("FMLA"),  or the Consolidated  Omnibus Budget  Reconstruction
Act of 1985  ("COBRA").  No employees or former  employees  of  Subsidiary  have
exercised  their rights under COBRA  except James M. Fox,  Addie Brice,  Eleanor
Jackson, Joyce Roach, and Betty Snow (collectively, the "COBRA Individuals"). No
employee or former  employee of  Subsidiary  is  currently,  or to the  Seller's
knowledge  likely to be, out, on leave,  or otherwise not  performing his or her
duties as a result of FMLA or any workman's compensation claim.

                  3.4 Consents and Approvals. There is no requirement applicable
to either  Seller to make any filing with,  or to obtain any consent or approval
from  any  Person,  as a  condition  to the  consummation  of  the  transactions
contemplated by this Agreement or the Service  Agreements except for the consent
of the Bank under the Loan  Documents  which the  Seller  will  obtain  prior to
Closing.

                  3.5 Litigation. Except as set forth in Schedule 3.5, there are
no  actions,  suits,  claims,  investigations,  orders,  judgments,  decrees  or
proceedings  pending or, to the knowledge of Seller,  threatened against Seller,
before any court, governmental body, commission,  agency or arbitrator, which if
decided  adversely to Seller could in any way challenge the consummation of this
transaction.

                  3.6  Title  to  Purchased   Assets.   Seller  holds  good  and
marketable  title  to all of the  Purchased  Assets,  free and  clear of  liens,
mortgages,   changes,   security   interests   or   other   defects   in   title
("Encumbrances"),  except  for the lien of the Bank  under  the Loan  Documents,
which Seller shall cause to be released at or prior to Closing.

                  3.7 No Finder.  Neither  Seller  nor any Person  acting on its
behalf has paid or become  obligated to pay any broker,  finder or  intermediary
for or on account of the  transactions  contemplated  by this  Agreement  or the
Service Agreements.

                  3.8 Disclaimer. The representations and warranties provided in
this Article III set forth all the representations and warranties of the Seller,
and except as expressly  stated herein,  BUYER ACCEPTS THE PURCHASED  ASSETS "AS

                                       6
<PAGE>

IS," AND SELLER EXPRESSLY  DISCLAIMS AND BUYER WAIVES ALL OTHER  REPRESENTATIONS
AND WARRANTIES,  EXPRESS, IMPLIED,  STATUTORY OR ARISING BY COURSE OF DEALING OR
PERFORMANCE,  CUSTOM,  USAGE  IN  THE  TRADE  OR  OTHERWISE,  INCLUDING  WITHOUT
LIMITATION  THE  IMPLIED  WARRANTIES  OF  MERCHANTABILITY   AND  FITNESS  FOR  A
PARTICULAR USE.

                  3.9 Intellectual Property.

                         (a)  Schedule  2.1(d)  constitutes  a  true,   correct,
current and complete list of all of the Purchased Intellectual Property.

                         (b) To Seller's knowledge, none of the Purchased Assets
violate any license or infringe any intellectual  property right of another.  To
the best of Seller's knowledge,  there are no pending or threatened  proceedings
or litigation or other adverse  claims (i) affecting the Purchased  Intellectual
Property;  (ii) which claim the Purchased  Intellectual  Property infringes upon
any person's licenses,  trade names, trademark (registered or common law), trade
name or trademark  registrations and applications,  service marks (registered or
common law), service mark  registrations and applications;  or (iii) which claim
the Purchased  Intellectual  Property violates the  Anticybersquatting  Consumer
Protection  Act  (codified  at 15 U.S.C.  ss.1125  et.  seq.),  nor is there any
reasonable   basis  upon  which  such  a  claim  may  be  asserted.   The  Buyer
acknowledges,  subject to Section 5.10,  that  trademarks  for  "American  Phone
Centers" and design,  Registration  No.  1,879,362 has  technically  expired for
failure to file a Declaration  of Continuing  Use. The Buyer  acknowledges  that
trademarks  for  "American  Phone  Centers"  and  design,  S/N,  79/190,898  and
"American  Phone  Centers"  and  design,  S/N  79/190,898  have been  abandoned,
"American  Phone  Centers"  and  design,  Registration  No.  1,291,520  has been
canceled, and that the Seller owns only common law rights in such trademarks.

                  3.10 Subsidiary Not Insolvent.  The Subsidiary is solvent, and
will not be rendered  insolvent as a result of the  consummation of the transfer
contemplated by this  Agreement,  and is and will continue to be is able to meet
all of its obligations in accordance with their terms.

                                   ARTICLE IV
                     REPRESENTATIONS AND WARRANTIES OF BUYER

                  Buyer represents and warrants to Seller the following:

                  4.1  Corporate   Authority.   Buyer  is  a  corporation   duly
organized,  validly existing and in good standing under the laws of the State of
Tennessee.  Buyer has all  requisite  power and authority to execute and deliver
this Agreement and the Service  Agreements  and to consummate  the  transactions
contemplated  hereby and thereby.  The  execution  and delivery by Buyer of this
Agreement  and  the  Service  Agreements  and  the  consummation  by it  of  the
transactions  contemplated hereby and thereby,  have been duly authorized by the
Directors of Buyer and no other  corporate  proceedings on the part of Buyer are
necessary  with  respect  thereto.  This  Agreement  has been duly  executed and

                                       7
<PAGE>

delivered by Buyer, and this Agreement and the Service Agreements, when executed
and delivered by Buyer, will constitute, valid and binding obligations of Buyer,
enforceable in accordance  with their terms except as their terms may be limited
by (i)  bankruptcy,  insolvency,  reorganization,  moratorium,  or similar  laws
affecting  creditors'  rights  generally or (ii) general  principles  of equity,
whether considered in a proceeding in equity or at law.

                  4.2 Consents and Approvals. There is no requirement applicable
to Buyer to make any filing  with,  or to obtain any  consent or approval of any
Person as a condition to the  consummation of the  transactions  contemplated by
this Agreement.

                  4.3 No Violation.  The execution and delivery by Buyer of this
Agreement and the Service Agreements does not and will not (i) violate or result
in a breach of any  provision  of the  Articles  of  Incorporation  or Bylaws of
Buyer,  (ii)  result in a  default,  or give  rise to any right of  termination,
modification  or acceleration  under the terms,  conditions or provisions of any
agreement  or other  instrument  or  obligation  to which Buyer is a party or by
which Buyer may be bound,  or (iii) violate any law or regulation,  or judgment,
order  or  decree  of  any  court,  governmental  body,  commission,  agency  or
arbitrator applicable to Buyer.

                  4.4 No  Finder.  Neither  Buyer nor any  Person  acting on its
behalf has paid or become  obligated to pay any broker,  finder or  intermediary
for or on account of the  transactions  contemplated  by this  Agreement  or the
Service Agreements

                  4.5 Litigation. Except as set forth in Schedule 3.5, there are
no  actions,  suits,  claims,  investigations,  orders,  judgments,  decrees  or
proceedings  pending or, to the knowledge of Buyer,  threatened  against  Buyer,
before any court, governmental body, commission,  agency or arbitrator, which if
decided  adversely to Buyer could in any way challenge the  consummation of this
transaction.

                                    ARTICLE V
                              ADDITIONAL AGREEMENTS

                  5.1 Confidentiality.

                         (a) The  information  which  Buyer has or will  acquire
about Seller as a result of the  transactions  contemplated by this Agreement is
termed  "Evaluation  Material."  Buyer  agrees  that  neither it, nor any of its
representatives  will (i) use any such  material  for any purpose not related to
the transactions  contemplated by this Agreement or the Supply Agreement or (ii)
disclose any such  material to anyone  except its  representatives  who may need
such  information to perform their  respective  duties and have been informed of
its  confidential  nature  and  directed  to  treat  it  confidentially.  If the
transactions  contemplated by this Agreement are not  consummated,  Buyer agrees
that it and its  representatives  will return any written Evaluation Material in
their  possession,  or will destroy and will not retain any such  material,  any
copies thereof or any notes or memoranda made using such material.

                                       8
<PAGE>

                         (b) The confidentiality agreement contained herein will
terminate  upon the  earlier  of three  years  after  the  date  hereof  or upon
consummation of the transactions contemplated hereby.

                         (c) The parties agree that monetary damages alone would
not be a satisfactory remedy for a breach of that portion of the confidentiality
agreement contained herein which relates to any proprietary  information held by
Seller,  including,  but not limited  to, any  proprietary  process  employed by
Seller in its manufacturing operations,  and that if that provision is breached,
Seller is entitled to injunctive relief as well as monetary damages.

                         (d)  Notwithstanding  the  foregoing,   Buyer  and  its
representatives  may  use  and  disclose  Evaluation  Material  and  information
obtained from the Evaluation  Material to the extent that (i) they acquired such
information on a  non-confidential  basis prior to receipt  thereof from Seller,
(ii) such  information has become  generally  available to the public,  or (iii)
such  information  is provided to the Person using or  disclosing it by a Person
who  obtained  such  information  other  than as a result  of a  breach  of this
Agreement.   Furthermore,  Buyer  and  its  representatives  may  disclose  such
information  to the  extent  that they are  required  to do so to comply  with a
governmental  or judicial order or decree,  but upon  receiving  notice that any
such  order or decree has been  issued or is being  sought,  they will  promptly
notify  Seller  and  will,  at the  expense  of  Seller,  if Seller  wants  such
information  to continue to be treated  confidentially,  cooperate with Seller's
efforts to contest the issuance of such order or decree.

                  5.2 Taxes and Recording  Fees.  All Transfer Taxes incurred in
connection with the acquisition of the Purchased Assets will be borne by Buyer.

                  5.3 Expenses.  Except as otherwise provided in this Agreement,
all costs and  expenses  incurred  in  connection  with this  Agreement  and the
transactions  contemplated hereby will be paid by the party incurring such costs
and expenses.

                  5.4  Public  Announcements.  Except as  required  by law,  the
parties will consult with each other before issuing any press releases or making
any public statements with respect to this Agreement and will not issue any such
press  release or make any such  public  statement  without  the  consent of the
other. After Closing, Buyer may, without Seller's consent, promote and advertise
the business in Buyer's sole discretion.

                  5.5 Efforts to Consummate. Subject to the terms and conditions
herein  provided,  each of the parties agrees to use its reasonable best efforts
to take, or cause to be taken,  all action,  and to do, or cause to be done, all
things necessary, proper or advisable to consummate, as promptly as practicable,
the  transactions  contemplated  hereby,  including,  but not  limited  to,  the
obtaining of all  necessary  consents,  waivers or  approvals of third  parties,
whether private or governmental,  required of it to enable it to comply with the
conditions  precedent to  consummating  the  transactions  contemplated  by this
Agreement.  Each party agrees to cooperate  fully with the other in assisting it
to comply with the  provisions of this  Section,  and Seller agrees to take such
steps as may be necessary to remove any Encumbrances  (other than  imperfections
of title  permitted  by this  Agreement)  which  affect  the  Purchased  Assets.

                                       9
<PAGE>

Notwithstanding the foregoing, no party hereto shall be required to initiate any
litigation,  make any substantial payment or incur any material economic burden,
except for a payment  otherwise  then  required  of it, to obtain  any  consent,
waiver, or approval,  and if, despite its efforts, any party is unable to obtain
any consent,  waiver or approval,  the other party may terminate  this Agreement
and shall have no liability therefor except as is provided in Article X.

                  5.6 Outstanding Purchase Orders. Prior to purchasing inventory
directly from any third party  vendor,  Buyer will use  commercially  reasonable
efforts to purchase  inventory under outstanding  purchase orders of Seller with
Seller's vendors as identified on Schedule 5.6.

                  5.7 Access.  From the date hereof  until the  Closing,  Seller
shall allow Buyer's employees, agents and representative during regular business
hours to make such  investigation of the business and Seller's books and records
related thereto,  as Buyer  reasonably deems necessary or advisable,  and Seller
shall  instruct its employees to cooperate in any such  investigation.  From and
after the Closing, so long as any books,  records or other files relating to the
Purchased  Assets or operation of the business,  to the extent that they pertain
to such operations prior to the Closing, remain in existence and available, each
party (at its expense) shall have the right, upon reasonable  notice, to inspect
and to make copies of the same at any time during regular business hours for any
purpose, including, without limitation, in connection with any third-party claim
in respect of which a party may have Liability hereunder.

                  5.8. Employee  Matters.  The fifty-three (53) employees of the
Seller designated on Schedule 5.8 ("Continuing  Employees") shall, commencing on
the Closing Date, become employees of the Buyer, and thereupon,  the Buyer shall
have full  responsibility  for all matters affecting such Continuing  Employees,
including,  without  limitation,  the  institution  of  new  benefit  plans  and
severance  practices.  With respect to periods  prior to the Closing  Date,  the
Seller shall pay all  obligations  relating to the employees,  including but not
limited to any obligations  relating to the COBRA  Individuals.  Notwithstanding
anything  herein to the  contrary,  Buyer shall not be  obligated  to retain any
Continuing Employee for any specified period of time after the Closing.

                  5.9. Name Change.  The  Subsidiary  shall execute and file the
necessary documentation to change the name it has qualified to do business under
in Virginia from "American Phone Centers,  Inc." to another name, which is in no
way similar to "American Phone Centers, Inc."

                  5.10  Declaration of Continuation.  Prior to the Closing,  the
Seller shall have filed a "Declaration of Continuing Use" with the United States
Patent and Trademark  Office for "American  Phone  Centers" and related  design,
Registration Number 1,879, 362.

                                   ARTICLE VI
                        CONDITIONS TO OBLIGATION OF BUYER

                  The  obligation  of  Buyer  to  consummate  the   transactions
contemplated  by this  Agreement  is subject,  to the extent not waived,  to the
following conditions.

                                       10
<PAGE>

                  6.1  Representations   and  Warranties.   Except  for  changes
contemplated by this Agreement,  each of the  representations  and warranties of
Seller contained in this Agreement (which representations and warranties include
the  information  in the  schedules  corresponding  thereto)  shall  be true and
correct in all  material  respects as of the date of Closing,  and Seller  shall
have  delivered  to  Buyer a  certificate  to that  effect  signed  by its  duly
authorized officer.

                  6.2 Performance of this Agreement.  Seller shall have complied
in all material  respects with all of its  obligations  under this Agreement and
shall have  delivered to Buyer a  certificate  to that effect signed by its duly
authorized officer.

                  6.3 Corporate Authorization.  All corporate action required to
be taken by Seller in  connection  with the  transactions  contemplated  by this
Agreement  shall  have been  taken,  all  documents  incident  thereto  shall be
reasonably  satisfactory  in substance  and form to Buyer,  and Buyer shall have
received such originals or copies of such documents as it may reasonably request
that are related to this Agreement.

                  6.4 Bank  Release.  The Seller  shall have  caused the Bank to
release any and all liens on and security  interests in the Purchased  Assets on
or prior to the Closing ("Release").  The Bank shall have executed and delivered
all documents  which the Buyer believes are  reasonably  necessary to consummate
the foregoing Release or committed to do so in writing.

                                   ARTICLE VII
                       CONDITIONS TO OBLIGATION OF SELLER

                  The  obligation  of  Seller  to  consummate  the  transactions
contemplated  by this  Agreement  is subject,  to the extent not waived,  to the
following conditions.

                  7.1    Representations    and   Warranties.    Each   of   the
representations  and warranties of Buyer  contained in this  Agreement  shall be
true and correct as of the date of Closing,  and Buyer shall have  delivered  to
Seller a certificate to that effect signed by its duly authorized officer.

                  7.2 Corporate  Authorization.  All action required to be taken
by Buyer in connection  with the  transactions  contemplated  by this  Agreement
shall have been  taken,  all  documents  incident  thereto  shall be  reasonably
satisfactory  in substance  and form to Seller,  and Seller shall have  received
such originals or copies of such documents as it may reasonably request that are
related to this Agreement.

                  7.3 Consent of Lender. Seller shall have received the approval
and consent of the Bank under the Loan Documents.

                                  ARTICLE VIII
                                     CLOSING

                  8.1 Time and Place of  Closing.  The closing  (the  "Closing")
shall take  place at the  offices of  Comdial  Corporation  in  Charlottesville,
Virginia at 10:00 AM local time on the latter of (i) the next business day after

                                       11
<PAGE>

the last of the  conditions to Closing is fulfilled or waived or (ii) such other
date as may be agreed upon by the parties  (either of which dates is referred to
in this  Agreement  as the "Closing  Date").  If the Closing  takes  place,  the
Closing and all of the  transactions  contemplated  by this  Agreement  shall be
deemed to have occurred  simultaneously  and become  effective as of 12:01 AM on
the Closing Date.

                  8.2 Deliveries by Seller.  At the Closing Seller shall deliver
to Buyer the following:

                           (i) a Bill of Sale and such other documents as may be
         necessary to transfer to Buyer the Purchased  Assets to be purchased by
         Buyer at Closing, all of which shall be in form satisfactory to Buyer;

                           (ii) the Certificates of the duly authorized  officer
         of Seller required by Sections 6.1 and 6.2;

                           (iii) evidence that the corporate action described in
         Section 6.3 has been taken;

                           (iv) a  certificate  from the  Secretary  of State of
         Delaware  of  Seller's  good  standing  as  of  the  most  recent  date
         obtainable;

                           (v) the documents  executed by the Bank to consummate
         the Release in accordance with Section 6.4; and

                           (vi)   such   additional   documents   as  Buyer  may
         reasonably request.

                  8.3 Deliveries by Buyer. At the Closing Buyer shall deliver to
Seller the following:

                           (i) the Cash Purchase Price in immediately  available
         funds;

                           (ii) duly  executed  copies of the Note and  Security
         Agreement;

                           (iii) the Certificate of the duly authorized  officer
         of Buyer required by Section 7.1;

                           (iv) evidence that the corporate  action described in
         Section 7.2 has been taken;

                           (v) a  certificate  from the State of Tennessee as to
         the good  standing  of Buyer in the State of  Tennessee  as of the most
         recent date obtainable;

                           (vi)  such   additional   documents   as  Seller  may
         reasonably request.

                                       12
<PAGE>

                  8.4 Deliveries by Seller and Buyer.  At the Closing Seller and
Buyer shall each  execute  and deliver to the other the Repair and  Discontinued
Product Agreements.

                                   ARTICLE IX
                                 INDEMNIFICATION

                  9.1  Indemnification  by  Seller  and  Buyer.  Subject  to the
limitations contained in this Article,  Seller and Buyer will indemnify and hold
each other  harmless  from any damage,  loss,  liability or expense  (including,
without  limitation,  reasonable  expenses of  investigation  and litigation and
reasonable attorneys', accountants' and other professional fees) arising out of:

                           (i) a breach of any  representation  or warranty made
         by the other party in this Agreement; and

                           (ii) a breach of any  agreement  of the  other  party
         contained  with this  Agreement  (but not the Repair  and  Discontinued
         Product Agreements, which will stand on their own).

                  9.2 Third-Party  Claims. The obligation of Seller and Buyer to
indemnify  one another  under the  provisions  of this  Article  with respect to
claims  resulting  from the  assertion of liability by those not parties to this
Agreement (including  governmental claims for penalties,  fines and assessments)
shall be subject to the following terms and conditions:

                           (i) The party  against  whom a claim by a third party
         has been made (the  "Indemnitee")  shall give prompt  written notice to
         the other party hereto (the "Indemnitor") of any assertion of liability
         by a third party which might give rise to a claim for  indemnification,
         which notice shall state the nature and basis of the  assertion and the
         amount thereof, to the extent known;  provided,  however, that no delay
         on the part of the  Indemnitee  in  giving  notice  shall  relieve  the
         Indemnitor of any  obligation  to indemnify  unless (and then solely to
         the extent that) the Indemnitor is prejudiced by such delay.

                           (ii) If any  action,  suit or  proceeding  (a  "Legal
         Action") is brought  against the  Indemnitee  with respect to which the
         Indemnitor  may have an  obligation to indemnify  the  Indemnitee,  the
         Legal  Action shall be defended by the  Indemnitor  and such defense to
         include  all  proceedings  for appeal or review  which  counsel for the
         Indemnitee shall reasonably deem appropriate.

                           (iii)  Notwithstanding the provisions of the previous
         subsection of this Article, until the Indemnitor shall have assumed the
         defense of any such Legal  Action,  the defense shall be handled by the
         Indemnitee.  Furthermore,  (A) if the Indemnitee  shall have reasonably
         concluded that there are likely to be defenses available to it that are
         different from or in addition to those available to the Indemnitor; (B)
         if the  Indemnitor  fails  to  provide  the  Indemnitee  with  evidence
         reasonably  acceptable  to  the  Indemnitee  that  the  Indemnitor  has
         sufficient    financial   resources   to   defend   and   fulfill   its
         indemnification obligation with respect to the Legal Action; (C) if the
         Legal Action involves other than money damages and seeks  injunctive or
         other  equitable  relief;  or (D) if a judgment  against the Indemnitee

                                       13
<PAGE>

         will, in the good faith opinion of the  Indemnitee,  establish a custom
         or precedent which will be materially  adverse to the best interests of
         its continuing business, the Indemnitor shall not be entitled to assume
         the defense of the Legal Action and the defense shall be handled by the
         Indemnitee.  If the  defense  of the  Legal  Action is  handled  by the
         Indemnitee  under the  provisions of this  subsection,  the  Indemnitor
         shall  pay all  legal and other  expenses  reasonably  incurred  by the
         Indemnitee in conducting such defense.

                           (iv) In any Legal  Action  initiated by a third party
         and defended by the Indemnitor (A) the Indemnitee  shall have the right
         to be  represented  by  advisory  counsel and  accountants,  at its own
         expense,  (B) Seller shall keep the Indemnitee fully informed as to the
         status of such Legal Action at all stages  thereof,  whether or not the
         Indemnitee is represented by its own counsel,  (C) the Indemnitor shall
         make available to the Indemnitor  and its  attorneys,  accountants  and
         other representatives, all books and records of the Indemnitor relating
         to such Legal  Action and (D) the  parties  shall  render to each other
         such  assistance as may be  reasonably  required in order to ensure the
         proper and adequate defense of the Legal Action.

                           (v) In any Legal  Action  initiated  by a third party
         and  defended  by  the  Indemnitor,   the  Indemnitor  shall  not  make
         settlement of any claim without the written  consent of the Indemnitee,
         which consent shall not be unreasonably withheld.  Without limiting the
         generality of the  foregoing,  it shall not be deemed  unreasonable  to
         withhold  consent  to  a  settlement   involving  injunctive  or  other
         equitable  relief  against the  Indemnitee or its assets,  employees or
         business,  or relief which the  Indemnitee  reasonably  believes  could
         establish a custom or precedent which will be materially adverse to the
         best interests of its continuing business.

                  9.3 Limitations on Indemnification.

                         (a)  Notwithstanding  the foregoing  provisions of this
Article  except for  Sections  3.6, 3.7 and 4.4 and  Excluded  Liabilities  with
respect to which no  Deductible  (as defined  below) shall apply,  neither party
shall be liable to the other  party  under  this  Article  unless  and until the
aggregate  amount of its  liability  exceeds  $50,000  (the  "Deductible"),  and
thereafter   the   party   seeking   indemnification   shall  be   entitled   to
indemnification  thereunder  only for the aggregate  amount of such liability in
excess of the Deductible. Additionally, the aggregate limit for all claims under
this  Article,  except  for claims  under  Sections  3.6,  3.7 and 4.4 and those
relating to Excluded Liabilities, shall be $550,000.

                         (b) All damages to which  either  party may be entitled
pursuant  to the  provisions  of  this  Article  shall  be net of any  insurance
proceeds actually received with respect thereto.

                         (c)  EXCEPT  AS  EXPRESSLY  PROVIDED  HEREIN,  UNDER NO
CIRCUMSTANCES  WILL  EITHER  PARTY BE LIABLE TO THE  OTHER  UNDER ANY  CONTRACT,
STRICT  LIABILITY,  NEGLIGENCE  OR OTHER  LEGAL  OR  EQUITABLE  THEORY,  FOR ANY
INCIDENTAL,   INDIRECT,  SPECIAL  OR  CONSEQUENTIAL  DAMAGES  OR  FOR  COSTS  OF
PROCUREMENT OF SUBSTITUTE  GOODS OR SERVICES OR FOR LOSS OF DATA OR LOST PROFITS

                                       14
<PAGE>

IN  CONNECTION  WITH THE SUBJECT  MATTER OR THE  TERMINATION  OF THIS  AGREEMENT
SUBJECT  TO THE  FOLLOWING  CONDITIONS:  (1) THIS  LIMITATION  DOES NOT APPLY TO
CLAIMS FOR BODILY INJURY OR DAMAGE TO REAL OR TANGIBLE  PERSONAL PROPERTY CAUSED
BY THE NEGLIGENCE OF EMPLOYEES OR REPRESENTATIVES OF SELLER OR BUYER; AND (2) IF
A THIRD  PARTY  MAKES  RECOVERY  AGAINST  SELLER  OR BUYER  AS A  RESULT  OF THE
PERFORMANCE  OR FAILURE TO PERFORM BY THE OTHER  PARTY  HERETO,  SUCH  RECOVERED
DAMAGES  SHALL BE TREATED TO THE FULLEST  EXTENT AS DIRECT  DAMAGES AND SHALL BE
RECOVERABLE AS SUCH BY SELLER OR BUYER UNDER THIS AGREEMENT.

                  9.4   Survival;   Investigation.   The   representations   and
warranties  of either  party  contained  in this  Agreement  shall  survive  any
investigation  by the  other  party and shall  not  terminate  until the  second
anniversary of the Closing (the "Survival Date") at which time they shall lapse.
Notwithstanding the provisions of the preceding sentence,  any representation or
warranty in respect of which  indemnification  may be sought  under this Article
shall survive the Survival  Date if written  notice,  given in good faith,  of a
specific  breach thereof is given to the other party prior to the Survival Date,
whether or not liability has actually been incurred.

                                    ARTICLE X
                        TERMINATION, AMENDMENT AND WAIVER

                  10.1 Termination. This Agreement may be terminated at any time
prior to the Closing:

                           (i) by mutual consent of Seller and Buyer;

                           (ii) by Buyer if any condition to Buyer's closing has
         not been  fulfilled  by May 15, 2001 (unless such failure is the result
         of action by Buyer); or

                           (iii) by Seller if any condition to Seller's  closing
         has not been  fulfilled  by May 15, 2001  (unless  such  failure is the
         result of action by Seller);

                  10.2 Effect of Termination. If this Agreement is terminated as
provided  above, it shall become wholly void and of no further force and effect,
and there  shall be no further  liability  or  obligation  on the part of either
party  except to pay such  expenses as are required of it and to comply with the
confidentiality  provisions  of  Section  5.1,  but such  termination  shall not
constitute a waiver by either party of any claim it may have for damages  caused
by reason of a material breach of a  representation,  warranty or agreement made
by the other party.

                  10.3 Amendment. This Agreement and the Schedules hereto may be
amended,  provided that any such amendment is approved in writing by each of the
parties.  All  representations  and  warranties  that are true and  correct,  as
modified  and  approved,  shall be deemed true and  correct for the  purposes of
Sections 6.1 and 7.1.

                                       15
<PAGE>
                                   ARTICLE XI
                               GENERAL PROVISIONS

                  11.1  Notices.  All  notices  and other  communications  given
hereunder  shall be in writing.  Notices shall be effective when  delivered,  if
delivered  personally.  Otherwise,  they  shall be  effective  when  sent to the
parties at the  addresses  or  numbers  listed  below,  as  follows:  (i) on the
business  day  delivered  (or the next  business day  following  delivery if not
delivered  on a  business  day) if sent by a  local  or long  distance  courier,
prepaid  telegram,  telefax or other  facsimile  means, or (ii) three days after
mailing if mailed by  registered or certified  U.S.  mail,  postage  prepaid and
return receipt requested.

                           If to Seller to:

                                    Comdial Corporation
                                    106 Cattlemen Rd.
                                    Sarasota, FL 34232
                                    Attention: Chief Financial Officer
                                    Telefax No.: (941) 925.7989

                           With a copy to:

                                    Attention :  SVP and General Counsel

                           If to Buyer to:

                                    King Technologies, Inc.
                                    805 Industrial Park Drive
                                    Trenton, TN  38382
                                    Attention:  Mr. George King
                                    Telefax No.: (731) 855-3591

                           With a copy to:

                                    Jonathan F. Kent, Esq.
                                    Miller & Martin LLP
                                    1000 Volunteer Building
                                    832 Georgia Avenue
                                    Chattanooga, TN  37402
                                    Telefax No.:  (423) 785-8426

Any Person may change the address or number to which notices are to be delivered
to him, her or it by giving the other  Persons  named above notice of the change
in the manner set forth above.

                                       16
<PAGE>

                  11.2 Governing  Law. This  Agreement  shall be governed in all
respects by the laws of the State of Tennessee  without  regard to its choice of
law rules. Any dispute, controversy, or claim arising out of or relating to this
Agreement,  or the breach,  termination  or invalidity  thereof shall be finally
settled by arbitration in accordance  with the Commercial  Arbitration  Rules of
the American Arbitration  Association in effect on the date of this Agreement by
one (1)  arbitrator  appointed in  accordance  with said Rules.  The  appointing
authority  shall  be  the  American  Arbitration   Association.   The  place  of
arbitration shall be Atlanta, Georgia. The arbitral award may be enforced in any
court of competent jurisdiction.

                  11.3  Schedules.  The  information  contained  in any Schedule
which is referred to in any  section of this  Agreement  shall be deemed to have
been disclosed in connection with, and to be incorporated  into, that particular
section only, and shall not be deemed a part of any other section.

                  11.4  Headings.  The headings  contained in this Agreement are
for reference  purposes only and shall not affect the meaning or  interpretation
of the Agreement.

                  11.5  Counterparts.  This  Agreement may be executed in two or
more counterparts,  each of which shall be deemed an original,  but all of which
together shall constitute one and the same instrument.

                  11.6 Miscellaneous.  This Agreement (i) constitutes the entire
agreement and supersedes all other prior  agreements  and  understandings,  both
written and oral, between the parties with respect to the subject matter hereof;
(ii) is not  intended to and shall not confer  upon any  Person,  other than the
parties  hereto,  any rights or  remedies;  and (iii)  shall not be  assigned by
operation of law or otherwise.

                            [Signature Page Follows]

                                       17
<PAGE>

                  IN  WITNESS  WHEREOF  the  parties  hereto  have  caused  this
Agreement  to be executed  and their  corporate  seals to be hereto  affixed and
attested by their duly authorized officers.

ATTEST:                                              COMDIAL CORPORATION

___________________________________         By:________________________________
Secretary                                   Title:_____________________________

                                                  AMERICAN PHONE CENTERS, INC.

___________________________________         By:________________________________
Secretary                                   Title:_____________________________

ATTEST:                                              KING TECHNOLOGIES, INC.

___________________________________         By:________________________________
Secretary                                   Title:_____________________________

                                       18
<PAGE>

                                    Exhibit A

                         DISCONTINUED PRODUCT AGREEMENT

                                       19
<PAGE>
                                    Exhibit B

                                REPAIR AGREEMENT

                                       20
<PAGE>
                                    Exhibit C

                               SECURITY AGREEMENT

                                       21
<PAGE>
                                    Exhibit D

                             SECURED PROMISSORY NOTE

                                       22
<PAGE>
                                 Schedule 2.1(a)

                               PURCHASED INVENTORY

                  Certain  inventory  consisting of raw materials  necessary for
the phone and key system  repair and  maintenance.  Items will be  identified by
type and quantity by the Seller and the Buyer.

                                       23
<PAGE>
                                 Schedule 2.1(b)

                               PURCHASED EQUIPMENT

                                       24
<PAGE>
                                 Schedule 2.1(c)

                                PURCHASED Q STOCK

                                       25
<PAGE>
                                 Schedule 2.1(d)

                         PURCHASED INTELLECTUAL PROPERTY

                                       26
<PAGE>

                                  Schedule 3.5

                                   LITIGATION

None.

                                       27

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