Document:

Exhibit

March 27, 2018

Wells Fargo Bank, National Association
2450 Colorado Avenue, Suite 3000W
Santa Monica, California  90404
Attention:  Harry L. Joe, Vice President

		
	Re:
	(i)  Credit and Security Agreement, dated March 13, 2012 (as heretofore amended, the “Domestic Credit Agreement”), among Dasan Zhone Solutions, Inc. (f/k/a Zhone Technologies, Inc.) and ZTI Merger Subsidiary III, Inc. (collectively, the “Borrowers”), Premisys Communications, Inc., Zhone Technologies International, Inc., Paradyne Networks, Inc., Paradyne Corporation, and Dasan Network Solutions, Inc. (collectively, the “Guarantors”), and Wells Fargo Bank, National Association (the “Lender”), and (ii) Credit and Security Agreement (Ex-Im Subfacility), dated March 13, 2012 (as heretofore amended, the “Ex-Im Credit Agreement”; and together with the Domestic Credit Agreement, collectively, the “Credit Agreements”), among the Borrowers, the Guarantors, and Lender

Ladies and Gentlemen:

Reference is made to the above-described Credit Agreements.  The Borrowers and the Guarantors are sometimes collectively referred to in this letter agreement as the “Loan Parties.”  Capitalized terms used but not defined in this letter agreement shall have the meanings set forth in the Domestic Credit Agreement.

The Loan Parties and Lender hereby agree to modify the definition of “Liquidity Trigger Event” set forth in Section 1.1 to the Credit Agreements to read in its entirety as follows:

“Liquidity Trigger Event” means the occurrence of any of the following:  (i) Borrowers fail to maintain at least $3,000,000 of Liquidity at all times; (ii) Borrowers fail to maintain at least $5,000,000 of Liquidity as of the last day of the first calendar month of each fiscal quarter; or (iii) Borrowers fail to maintain Liquidity as of the last day of each fiscal quarter of at least (x) $5,000,000, as of March 31, 2018, or (y) $10,000,000, as of the last day of any other fiscal quarter.

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This letter agreement shall become effective upon satisfaction of the following terms and conditions:  (i) Lender shall have received the countersignatures of the Borrowers and Guarantors on this letter agreement agreeing to the terms and conditions of this letter agreement; and (ii) all representations and warranties of the Borrowers and the Guarantors in the Loan Documents and this letter agreement shall be true and correct in all material respects as of the date hereof (except for such representations and warranties that by their terms expressly speak as of an earlier date, in which case such representations and warranties shall continue to be true and correct in all material respects as of such earlier date).  

In order to induce Lender to execute and deliver this letter agreement, the Loan Parties hereby (i) represent and warrant that no Default or Event of Default exists on the date hereof, (ii) ratify and confirm all of the Obligations of the Loan Parties pursuant to the Loan Documents, and (iii) acknowledge that no investigation by Lender shall affect any representations or warranties made by the Loan Parties in this letter agreement or the right of Lender to rely upon them.

Except as expressly set forth herein, (i) the Loan Documents remain in full force and effect, (ii) this letter agreement shall not be deemed to be a waiver, amendment or modification of, or consent to or departure from, any provisions of the Credit Agreements or any other Loan Document or to be a waiver of any Default or Event of Default under the Loan Documents whether arising before or after the date hereof or as a result of the transactions contemplated hereby (except for the specific consent referenced above in this letter agreement), and (iii) this letter agreement shall not preclude the future exercise of any right, remedy, power or privilege available to Lender whether under the Credit Agreements, the other Loan Documents or otherwise and shall not be construed or deemed to be a satisfaction, novation, cure, modification, amendment or release of the Obligations, Credit Agreements, or other Loan Documents.

To further induce Lender to enter into this letter agreement, the Loan Parties each hereby absolutely and unconditionally releases and forever discharges Lender, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents, attorneys, and employees of any of the foregoing, from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, which any Loan Party has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this letter agreement, whether such claims, demands and causes of action are matured or unmatured or known or unknown.  It is the intention of the Loan Parties in executing this release that the same shall be effective as a bar to each and every claim, demand and cause of action specified and in furtherance of this intention each Loan Party waives and relinquishes all rights and benefits under Section 1542 of the Civil Code of the State of California, which provides:

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“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MIGHT HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”
The parties acknowledge that each may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agree that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts.

This letter agreement (i) constitutes the entire understanding of the parties with respect to the subject matter hereof, and any other prior or contemporaneous agreements, whether written or oral, with respect hereto are expressly superseded hereby, (ii) shall be governed by and construed in accordance with the laws of the State of California, and (iii) shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto.  This letter agreement may be executed in one or more counterparts (which taken together shall constitute one and the same instrument) and by facsimile or email (pdf) transmission, which facsimile or pdf signatures shall be considered original executed counterparts.

This letter agreement shall be deemed to be a “Loan Document” for purposes of the Credit Agreements and the other Loan Documents.

[signatures on following pages]

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Kindly acknowledge your agreement with the terms and conditions of this letter agreement, by executing one copy of this letter in the space provided and returning it to Lender.

Very truly yours,

	
			
	DASAN ZHONE SOLUTIONS, INC.
	 
	ZTI MERGER SUBSIDIARY III, INC.

	 
	 
	 

	By:/s/ Michael Golomb 
	 
	By:/s/ Michael Golomb 

	Name:  Michael Golomb 
	 
	Name:  Michael Golomb 

	Title:  Chief Financial Officer
	 
	Title:  Chief Financial Officer

	 
	 
	 

	PREMISYS COMMUNICATIONS, INC.
	 
	ZHONE TECHNOLOGIES INTERNATIONAL, INC.

	 
	 
	 

	By:/s/ Michael Golomb 
	 
	By:/s/ Michael Golomb 

	Name:  Michael Golomb 
	 
	Name:  Michael Golomb 

	Title:  Chief Financial Officer
	 
	Title:  Chief Financial Officer

	 
	 
	 

	PARADYNE NETWORKS, INC.
	 
	PARADYNE CORPORATION

	 
	 
	 

	By:/s/ Michael Golomb 
	 
	By:/s/ Michael Golomb 

	Name:  Michael Golomb 
	 
	Name:  Michael Golomb 

	Title:  Chief Financial Officer
	 
	Title:  Chief Financial Officer

	 
	 
	 

	DASAN NETWORK SOLUTIONS, INC.
	 
	 

	 
	 
	 

	By:/s/ Michael Golomb 
	 
	 

	Name:  Michael Golomb 
	 
	 

	Title:  Chief Financial Officer
	 
	 

[signatures continued on next page]

Modification of Liquidity Trigger Event Definition 
(WFB/Dasan/Zhone)

Acknowledged and agreed to by Lender
as of the date first above written:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: /s/ Harry L. Joe        
Name:  Harry L. Joe
Title:  Authorized Signatory

Modification of Liquidity Trigger Event Definition 
(WFB/Dasan/Zhone)ex_109803.htm

Exhibit 10.1

 

CONFIDENTIAL

 

SECURITIES PURCHASE AGREEMENT

 

THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”) is entered into and effective simultaneously with the execution of this Agreement on this 3rd day of April 2018, by and between BIO-key International, Inc., a Delaware corporation (the “Company”), and Wong Kwok Fong (the “Purchaser”). 

 

R E C I T A L S:

 

WHEREAS, subject to the terms and conditions of this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), Purchaser desires to purchase and the Company desires to sell securities on the terms and conditions set forth herein. 

 

NOW, THEREFORE, in consideration of the premises hereof and the agreements set forth herein below, the parties hereto hereby agree as follows:

 

1.          Sale and Purchase of Securities. 

 

(a)     Purchase and Sale. Subject to the terms and conditions hereof, the Company agrees to sell, and Purchaser agrees to purchase Ninety One Thousand Eight Hundred Twenty (91,820) shares (the “Shares”) of the Company’s common stock, $0.0001 par value per share (the “Common Stock”), at a purchase price of $3.60 per Share for an aggregate purchase price of $330,552 (the “Purchase Price”). The Purchase Price shall be paid by the conversion of a dividend payable in the amount of $330,552 on the Company’s Series A-1 Convertible Preferred Stock (the “Series A-1 Preferred”) presently due and payable to the Purchaser. Within a reasonable time following the date hereof, the Company shall deliver to the Purchaser, a certificate evidencing the Shares.

 

2.           Representations and Warranties of Purchaser. Purchaser represents and warrants to the Company as follows:

 

(a)     Authority Validity and Effect of Agreement. The execution and delivery of each of this Agreement by Purchaser and the performance by Purchaser of its obligations hereunder have been duly authorized by all necessary organizational proceedings on the part of the Purchaser. This Agreement has been duly and validly executed and delivered by Purchaser and, assuming that it has been duly authorized, executed and delivered by the Company, constitutes a legal, valid and binding obligation of Purchaser, in accordance with its terms. 

 

(b)     Acknowledgement Regarding Conversion of Dividend Payable. Purchaser acknowledges that the accrued dividend payable on the Series A-1 Preferred due and owing to Purchaser as of March 31, 2018 is $330,552 (the “Dividend Payable”) and hereby releases and relinquishes any right, title and interest to the Dividend Payable as consideration for the payment of the Shares. 

 

 

 

 

(c)     Accredited Investor.  Purchaser is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D under the Securities Act.

 

(d)     Investment Intent. The Securities are being acquired for Purchaser’s own account for investment purposes only, not as a nominee or agent and not with a view to the resale or distribution of any part thereof, and Purchaser has no present intention of selling, granting any participation in or otherwise distributing the same.

 

(e)     Restrictions on Transfer. Purchaser understands that the Securities are “restricted securities” as such term is defined in Rule 144 under the Securities Act and have not been registered under the Securities Act or registered or qualified under any state securities law, and may not be, directly or indirectly, sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of without registration under the Securities Act and registration or qualification under applicable state securities laws or the availability of an exemption therefrom.

 

(f)     Short Sales. Purchaser has not directly or indirectly, nor has any person acting on behalf of or pursuant to any understanding with Purchaser, executed any disposition, including Short Sales (as such term is defined in Rule 200 of Regulation SHO under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), in the securities of the Company during the period commencing from the time that Purchaser first received written or oral notice of the transactions contemplated herby until the date hereof (“Discussion Time”).

 

(g)     No Disqualification Events. Purchaser is not subject to any of the "Bad Actor" disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a "Disqualification Event"), except for a Disqualification Event covered by Rule 506(d)(2) under the Securities Act. 

 

3.          Representations and Warranties of the Company. The Company represents and warrants to Purchaser as follows:

 

(a)     Authority Validity and Effect of Agreement. The execution and delivery of each of this Agreement by the Company and the performance by the Company of its obligations hereunder have been duly authorized by all necessary corporate proceedings on the part of the Company. This Agreement has been duly and validly executed and delivered by the Company and, assuming that it has been duly authorized, executed and delivered by Purchaser, constitutes a legal, valid and binding obligation of the Company, in accordance with its terms.

 

(b)     Issuance of the Securities. The Shares have been duly authorized and, when issued and paid for in accordance with the terms of this Agreement, will be duly and validly issued, fully paid and nonassessable, free and clear of all liens, other than restrictions on transfer provided for in this Agreement or imposed by applicable securities laws, and shall not be subject to preemptive or similar rights of shareholders. 

 

4.          Other Agreements of the Parties.

 

(a)     Legends. The certificates and agreements evidencing the Shares shall have endorsed thereon a standard and customary legend respecting the Securities Act and stop transfer instructions reflecting these restrictions on transfer will be placed with the transfer agent of the Securities.

 

 

 

 

(b)     Notice of Disqualification Events. Purchaser will notify the Company in writing, of (i) any Disqualification Event relating to Purchaser and (ii) any event that would, with the passage of time, become a Disqualification Event relating to Purchaser.

 

(c)     Standstill. Reference is hereby made to those certain Securities Purchase Agreements dated October 29, 2015 and November 11, 2015 (collectively, the “Series A-1 Agreements”) by and between the Company and the Purchaser, pursuant to which the Purchaser purchased 90,000 shares of the Company’s Series A-1 Convertible Preferred Stock. The Series A-1 Agreements contain standstill provisions (the “Standstill Provisions”), which prevent the Purchaser, either alone or together with any other person, from acquiring additional shares of the Company’s Common Stock or any of the Company’s assets, soliciting proxies, or seeking further representation on the Company’s board of directors. The Purchaser hereby acknowledges and agrees that: (i) the Company is hereby waiving the Standstill Provisions solely with respect to the Shares purchased hereby, and (ii) that notwithstanding the foregoing the Standstill Provisions remain in full force and effect.

 

5.          Non-Public Information. Purchaser acknowledges that certain information concerning the matters that are the subject matter of this Agreement constitute material non-public information under United States federal securities laws, and that United States federal securities laws prohibit any person who has received material non-public information relating to the Company from purchasing or selling securities of the Company, or from communicating such information to any person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell securities of the Company. Accordingly, until such time as any such non-public information has been adequately disseminated to the public, Purchaser shall not purchase or sell any securities of the Company, or communicate such information to any other person 

 

6.          Entire Agreement. This Agreement contains the entire agreement between the parties and supersedes all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereto. 

 

7.          Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey, without regard to the laws that might otherwise govern under applicable principles of conflicts of laws thereof, except to the extent that the General Corporation Law of the State of Delaware shall apply to the internal corporate governance of the Company.

 

8.          Arbitration. If a dispute arises as to the interpretation of this Agreement, it shall be decided in an arbitration proceeding conforming to the Rules of the American Arbitration Association applicable to commercial arbitration then in effect at the time of the dispute. The arbitration shall take place in the State of New Jersey. The decision of the arbitrators shall be conclusively binding upon the parties and final and such decision shall be enforceable as a judgment in any court of competent jurisdiction. The parties shall share equally the costs of the arbitration.

 

 

 

 

9.          Counterparts. This Agreement may be executed and delivered by facsimile in counterparts, each of which shall be deemed to be an original, and both of which together shall constitute one and the same agreement.

 

WITNESS WHEREOF, intending to be legally bound, the parties hereto have caused this Agreement to be executed as of the date set forth above.

 

	 	
			 

			PURCHASER

			 

			 

			WONG KWOK FONG

			 

			 

			By: /s/Wong Kwok Fong 

			Name: Wong Kwok Fong 

			
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	
			BIO-KEY INTERNATIONAL, INC.

			 

			 

			By: /s/ Michael W. DePasquale

			Name: Michael W. DePasquale

			      Title: Chief Executive Officer

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