EXHIBIT 4(b)(6)
GMAC COMMERCIAL CREDIT LLC
1290 Avenue of the Americas
New York, New York 10104
as of September 24, 2002
TII NETWORK TECHNOLOGIES, INC.
1385 Akron Street
Copiague, New York 11726
Re: Amendment to Loan Documents
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Gentlemen:
Reference is made to certain financing arrangements by and among GMAC
COMMERCIAL CREDIT LLC, formerly known as BNY FACTORING LLC, as successor by
merger to BNY Financial Corporation ("Lender"), TII NETWORK TECHNOLOGIES, INC.,
formerly known as TII Industries, Inc., ("Borrower") and TII Corporation (which
was subsequently dissolved), pursuant to certain financing agreements, including
that certain Revolving Credit, Term Loan and Security Agreement dated April 30,
1998 (the "Credit Agreement"), together with various other agreements, documents
and instruments referred to therein or at any time executed and/or delivered in
connection therewith or related thereto (all of the foregoing, together with the
Credit Agreement, as the same has been, is hereby being, and may hereafter be
amended, restated, renewed, extended, supplemented, substituted or otherwise
modified, collectively, the "Loan Documents").
Borrower has requested that Lender agree to amend certain provisions of the
Loan Documents, all as more fully set forth in this letter Re: Amendment to Loan
Documents ("Amendment"). Lender has agreed to accommodate Borrower's request
subject to the terms and conditions hereof.
1. Amendments.
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(a) Section 6.5 of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:
"6.5 Net Worth. Cause to be maintained at all times a
consolidated Net Worth in an amount (the "Minimum Net Worth") not less
than (a) for Borrower's fiscal quarter ending March 29, 2002,
$17,750,000, (b) for Borrower's fiscal quarter ending June 28, 2002,
$14,000,000, and (c) for each of Borrower's fiscal quarters
thereafter, an amount equal to the sum of the
Minimum Net Worth required for the immediately previous fiscal quarter
plus fifty percent (50%) of Net Income (to the extent Net Income is
positive) for such immediately previous fiscal quarter.
Notwithstanding anything in this Agreement to the contrary, Borrower
shall be deemed to be in compliance with this Section 6.5 at all times
during any fiscal quarter other than the last day of such fiscal
quarter (each such time hereinafter an "Interim Date") if, as of any
Interim Date, Borrower's consolidated Net Worth is not more than
$150,000 less than the applicable Minimum Net Worth required hereunder
as of the last day of such fiscal quarter. Nothing herein shall
release Borrower from its obligation to maintain the requisite Minimum
Net Worth as of the last day of each fiscal quarter."
(b) The first sentence of Section 13.1 of the Credit Agreement is
hereby amended and restated in its entirety to read as follows:
"13.1 Term. This Agreement, which shall inure to the benefit of
and shall be binding upon the respective successors and permitted
assigns of each of the Borrower and the Lender, shall become effective
on the date hereof and shall continue in full force and effect until
September 30, 2003 (the "Term") unless sooner terminated as herein
provided."
2. Representations, Warranties and Covenants. In addition to the continuing
representations, warranties and covenants heretofore made by Borrower to Lender
pursuant to the Loan Documents, Borrower hereby represents, warrants and
covenants with and to Lender as follows (which representations, warranties and
covenants are continuing and shall survive the execution and delivery hereof and
shall be incorporated into and made a part of the Loan Documents):
(a) No Event of Default exists or has occurred and is continuing on
the date of this amendment upon giving effect to the terms of this amendment.
(b) This Amendment has been duly executed and delivered by Borrower
and is in full force and effect as of the date hereof, and the agreements and
obligations of Borrower contained herein constitute the legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with its
terms.
(c) Except as specifically set forth herein, no other changes or
modifications to the Loan Documents are intended or implied, and in all other
respects, the Loan Documents shall continue to remain in full force and effect
in accordance with their respective terms as of the date hereof. Except as
specifically set forth herein, nothing contained herein shall evidence a waiver
or amendment by Lender of any other provision of the Loan Documents nor shall
anything contained herein be construed as a consent by Lender to any transaction
other than that specifically consented to herein.
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(d) The terms and provisions of this Amendment shall be for the
benefit of the parties hereto and their respective successors and assigns; no
other person, firm, entity or corporation shall have any right benefit or
interest under this amendment. This Amendment may be signed in counterparts,
each of which shall be an original and all of which when taken together shall
constitute one amendment. In making proof of this Amendment, it shall not be
necessary to produce or account for more than one counterpart signed by the
party to be charged.
(e) This Amendment sets forth the entire agreement and understanding
of the parties with respect to the matter set forth herein. This Amendment
cannot be changed, modified, amended or terminated except in writing executed by
the party to be charged.
3. Amendment Fee. In consideration of the amendments to the Loan Documents
set forth herein, Borrower unconditionally agrees to pay an amendment fee in the
amount of $15,000, which amendment fee shall be fully earned as of the date of
hereof, shall not be subject to refund, rebate or proration for any reason
whatsoever, and shall be charged by Lender to Borrower as of the date hereof.
IN WITNESS WHEREOF, Lender and Borrower have executed this Amendment as of
the day and year first above written.
GMAC COMMERCIAL CREDIT LLC
By: /s/ David Duffy
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Title: Vice President
ACKNOWLEDGED AND AGREED:
TII NETWORK TECHNOLOGIES, INC.
By: /s/ Kenneth A. Paladino
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Title: Vice President Finance
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