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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                        Date of Report (Date of Earliest
                         Event Reported): June 28, 2005

                               COMDIAL CORPORATION
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             (Exact name of registrant as specified in its charter)

           Delaware                      0-9023                94-2443673
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  (State or other jurisdiction        (Commission            (IRS Employer
        of incorporation)             File Number)        Identification No.)

                106 Cattlemen Road
                 Sarasota, Florida                                34232
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     (Address of principal executive offices)                  (Zip Code)

       Registrant's telephone number, including area code: (941) 554-5000

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

[ ]  Written communications pursuant to Rule 425 under the Securities
     Act (17 CFR 230.425)

[ ]  Soliciting material pursuant to Rule 14a-12 under the Exchange
     Act (17 CFR 240.14a-12)

[ ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the
     Exchange Act (17 CFR 240.14d-2(b))

[ ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the
     Exchange Act (17 CFR 240.13e-4(c))

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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

On May 26, 2005, Comdial Corporation and its affiliates (the Company) filed
voluntary petitions for relief under Chapter 11 of the United States Bankruptcy
Code (the "Bankruptcy Code"). In connection with its Chapter 11 filing, the
Company obtained a commitment for $3.0 million in debtor-in-possession (DIP)
financing from Dialcom Acquisition LLC. On June 28, 2005, the Company received
authorization from the United States Bankruptcy Court for the District of
Delaware (the Court) to obtain post-petition loans, advances and other financial
accommodations on a final basis from Dialcom Acquisition LLC in accordance with
the DIP Loan Agreement.

In addition, on June 28, 2005 the Court approved the implementation of a key
employee retention plan (KERP). The approved plan provides severance or
retention bonuses for specified employees as defined in the agreement.

ITEM 1.03 BANKRUPTCY OR RECEIVERSHIP

On June 28, 2005 the Company received authorization to proceed with the bidding
procedures and sale approval process as outlined in the Motion of Debtors and
Debtors in Possession for an Order, Pursuant to Section 363 of the Bankruptcy
Code, (a) Establishing Bidding Procedures for the Sale of Certain of the
Debtors' Assets; (b) Approving Certain Bid Protections;(c) Scheduling Auction
and Final Hearing; and (d) Approving the Form and Manner of Notice Thereof. Per
the Asset Purchase Agreement with Dialcom Acquisition, LLC, the Company has
agreed to sell substantially all of their assets, subject to higher or better
offers and Court approval, to Dialcom Acquisition LLC for a purchase price
consisting of $8.5 million in the form of a credit bid on the subordinated
secured debt instruments, $250,000 in cash, the assumption of a $2.0 million
note and the defined assumed liabilities, $2.5 million of preferred membership
interests in Dialcom Acquisition LLC, assumption of the DIP financing and
assumption of the KERP. Per the bidding procedures, if other qualified bidders
submit other offers with the Court and it is determined that the bid price is
sufficient, an auction will be held on August 25, 2005. The final hearing to
approve the results of the auction will be held on August 29, 2005.

Parties may contact Delaware Claims, LLC, P.O. Box 515, Wilmington, Delaware
19899 to obtain copies of pleadings filed in the Company's bankruptcy
proceeding.

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                                    SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                                 COMDIAL CORPORATION

                                                 By: /s/ Kenneth M. Clinebell
                                                     ---------------------------
                                                     Kenneth M. Clinebell
                                                     Chief Operating Officer
                                                     Chief Financial Officer and
                                                     Senior Vice President

Dated:  July 5, 2005

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