Verilink (NASDAQ:VRLK)
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Verilink Announces Modifications to Line of Credit
Credit Line Available for Working Capital Needs
MADISON, Ala., Nov. 17 /PRNewswire-FirstCall/ -- Verilink Corporation
(NASDAQ:VRLK), a leading provider of broadband access solutions, today
announced that RBC Centura Bank has waived Verilink's previously announced
noncompliance with the tangible net worth financial covenant under the terms of
the loan documents. The loan documents have also been modified, among other
things, to reduce the total amount available under the line of credit to
$3,500,000 from $5,000,000, and to reduce the minimum required tangible net
worth covenant to $5,000,000 from $7,000,000. The line of credit expires April
7, 2005.
Approximately $2 million is currently outstanding under the line of credit. As
a result of the waiver and modifications, Verilink is now permitted to borrow
under the line of credit based on eligible accounts receivable.
About Verilink Corporation
Verilink Corporation is a leading provider of next-generation broadband access
solutions for today's and tomorrow's networks. The company develops,
manufactures and markets a broad suite of products that enable carriers (ILECs,
CLECs, IXCs, and IOCs) and enterprises to build converged access networks to
cost-effectively deliver next-generation communications services to their end
customers. The company's products include a complete line of VoIP and TDM-based
integrated access devices (IADs), optical access products, wire-speed routers,
and bandwidth aggregation solutions including CSU/DSUs, multiplexers and DACS.
Verilink also provides turnkey professional services to help carriers plan,
manage and accelerate the deployment of new services. The company has
operations in Madison, AL, Aurora, CO and Newark, CA with sales offices in the
U.S., Europe and Asia. To learn more about Verilink, visit the company's
website at http://www.verilink.com/ .
Note: Except for the historical information contained herein, the matters set
forth in this press release, including statements as to future borrowings under
the line of credit, are forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including, but not limited
to, the potential impact on the Company's liquidity and operations if its line
of credit is not extended or renewed; the ability to successfully integrate
acquisitions and achieve expected synergies; the ability of the combined
company to develop and market successfully and in a timely manner new products
and to predict market demand for particular products; the impact of competitive
products and pricing and of alternative technological advances; the ability to
increase sales of acquired product lines; the sufficiency of cost-saving
activities, including the engineering consolidation plan; sufficient cash flow
to fund operations and lower than expected cash flows from operations; risks
associated with the Company's low level of liquidity and "going concern"
paragraph in the report of independent registered public accounting firm for
the audited fiscal 2004 financial statements; possible negative effects on our
customer base, employees and our ability to obtain additional financing;
fluctuations in operating results and general industry, economic and internal
controls; the impact of price and product competition; the impact of customer
concentration and the financial strength of customers; and changes in demand
for the Company's products. A discussion of these and other risks and
uncertainties that could cause actual results and events to differ materially
from such forward-looking statements are included in Verilink's most recent
Annual Report on Form 10-K and Quarterly Report on Form 10-Q. These
forward-looking statements speak only as of the date hereof. Verilink disclaims
any intention or obligation to update or revise any forward-looking statements.
NOTE: Verilink, the Verilink logo are registered trademarks of Verilink
Corporation. Larscom is a registered trademark of Larscom Incorporated. All
other trademarks or registered trademarks are the property of the respective
owners.
DATASOURCE: Verilink Corporation
CONTACT: Bill Smith, +1-256-327-2204, or , or
Gary W. Gray, +1-408-771-3354, or , both of
Verilink Corporation
Web site: http://www.verilink.com/