COMSHARE, INCORPORATED
NINTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER
Harris Trust and Savings Bank
Chicago, Illinois
Ladies and Gentlemen:
Reference is hereby made to that certain Credit Agreement (as amended,
supplemented, modified or restated from time to time, the "Credit Agreement"),
dated as of September 23, 1997, by and among Comshare, Incorporated (the
"Company") and Comshare Limited (the "Borrowing Subsidiary") (together the
"Borrowers") and Harris Trust and Savings Bank (the "Bank"). All capitalized
terms used herein without definition shall have the same meanings herein as such
terms have in the Credit Agreement.
The Borrowers have requested that the Bank waive certain Events of
Default under, and amend certain provisions of, the Credit Agreement, and the
Bank will do so under the terms and conditions set forth in this Ninth Amendment
to Credit Agreement and Waiver (this "Amendment").
1. WAIVER.
(a) During the period ending June 30, 2002, the Company was in
violation of the financial covenants in Sections 8.7 (Net Worth), 8.8 (Fixed
Charge Coverage Ratio) and 8.9 (Minimum EBITDAL) of the Credit Agreement (the
"Violations"). Subject to the satisfaction of the conditions precedent set forth
in Section 3 below, the Bank hereby waives any Default or Event of Default that
would otherwise exist under the Credit Agreement by virtue of the Violations.
(b) The waiver under this Section 1 shall be limited specifically as
written herein and shall be solely a waiver with respect to the above described
Violations, and it shall not constitute a waiver of the application of Sections
8.7, 8.8 and 8.9 of the Credit Agreement for any other fiscal period.
2. AMENDMENTS.
Subject to the satisfaction of the conditions precedent set forth in
Section 3 below, the Credit Agreement shall be and is hereby amended as follows:
2.1. Revolving Credit. The first sentence of Section 1.1 of
the Credit Agreement shall be amended and restated in its entirety to
read as follows:
"The Revolving Credit may be utilized by each
Borrower in the form of loans (individually a "Loan" and
collectively the "Loans") on a revolving basis in U.S. Dollars
and Optional Currencies, all as more fully hereinafter set
forth; provided, however, that the aggregate amount of Loans
and Letters of Credit outstanding, or the U.S. Dollar
Equivalent thereof, for Loans or Letters of Credit denominated
in an Optional Currency, shall not at any one time shall
exceed $7,000,000 (such amount, as the same may be reduced
pursuant to Section 3.4 hereof, being hereinafter referred to
as the "Commitment")."
2.2. Mandatory Prepayment. Section 3.3 of the Credit Agreement
shall be amended and restated in its entirety to read as follows:
"Section 3.3. Mandatory Prepayment. The Borrowers
covenant and agree that the aggregate outstanding amount of
Loans and Letters of Credit denominated in Optional Currencies
shall be revalued at the time of any extension of credit or of
any creation, conversion or continuation of a Eurocurrency
Portion (each a "Revaluation Event"). If (1) at the time of
any Revaluation Event, the aggregate amount of Loans and
Letters of Credit then outstanding, using the U.S. Dollar
Equivalent thereof determined at such time, for Loans or
Letters of Credit denominated in an Optional Currency, or (2)
at any time, the sum of the aggregate Original Dollar Amount
of Loans and Letters of Credit then outstanding, shall be in
excess of (in the case of either clauses (1) or (2), above),
the Commitment then in effect, the Borrowers shall immediately
and without notice or demand pay over the amount of the amount
of the excess to the Bank as and for a mandatory prepayment on
the Note until payment in full thereof. Each such prepayment
shall be accompanied by accrued interest on the amount prepaid
to the date of prepayment plus any amounts due to the Bank
under Section 11.5 hereof."
2.3. Definition Deletions. The definition of "Borrowing Base"
in Section 5 of the Credit Agreement shall be and is hereby deleted in
its entirety.
2.4. Termination Date. The definition of "Termination Date" in
Section 5 of the Credit Agreement shall be amended and restated in its
entirety to read as follows:
"Termination Date" means September 30, 2003, or such
earlier date on which the Commitment is terminated in whole
pursuant to Section 3.4, 9.2 or 9.3 hereof, or such later date
to which the Termination Date is extended pursuant to Section
12.4 hereof."
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2.5. All Advances. Subsection (c) of Section 7.1 of the Credit
Agreement shall be amended and restated in its entirety to read as
follows:
"(c) in the case of any request for a Loan or for
issuance of a Letter of Credit, after giving effect to such
extension of credit, the aggregate amount of Loans and Letters
of Credit then outstanding, using the U.S. Dollar Equivalent
thereof determined at such time, for Loans or Letters of
Credit denominated in an Optional Currency, shall not exceed
the Commitment;"
2.6. Initial Advances. Subsection (g) of Section 7.2 of the
Credit Agreement shall be amended and restated in its entirety to read
as follows:
"(g) [INTENTIONALLY OMITTED]"
2.7. Financial Reports. Section 8.5(a) of the Credit Agreement
shall be amended and restated in its entirety to read as follows:
"(a) [INTENTIONALLY OMITTED]"
2.8. Net Worth. Section 8.7 of the Credit Agreement shall be
amended and restated in its entirety to read as follows:
"Section 8.7. Net Worth. The Company shall not, as of
the last day of each calendar quarter, permit Net Worth to be
less than the Minimum Required Amount. For purposes of this
Section, the term "Minimum Required Amount" shall mean as of
any time for which the same is to be determined (i)
$17,191,000 from July 1, 2002 through and including September
30, 2002, (ii) $17,798,000 thereafter and through and
including December 31, 2002, (iii) $18,487,000 thereafter and
through and including March 31, 2003, (iv) $20,691,000
thereafter, and provided that the Minimum Required Amount
shall be increased above such amount (but never decreased) as
of July 1, 2003 and each July 1 thereafter by an amount (if
positive) equal to 50% of Net Income for the then most
recently completed fiscal year of the Company."
2.9. Fixed Charge Coverage Ratio. Section 8.8 of the Credit
Agreement shall be amended and restated in its entirety to read as
follows:
"Section 8.8. Fixed Charge Coverage Ratio. The
Company shall not, as of each date set forth below (commencing
on September 30, 2002), permit the Fixed Charge Coverage Ratio
to be less than indicated below for such period:
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FIXED CHARGE
DURING THE PERIOD COVERAGE RATIO
FOR SUCH PERIOD
SHALL NOT BE LESS
THAN:
The twelve calendar 9/30/02 0.29 to 1
months ending
The twelve calendar 12/31/02 0.73 to 1
months ending
The twelve calendar 3/31/03 and 1.25 to 1"
months ending each calendar
quarter
thereafter
2.10. Minimum EBITDAL. Section 8.9 of the Credit Agreement
shall be amended and restated in its entirety to read as follows:
"Section 8.9. Minimum EBITDAL. As of the last day of
each fiscal quarter of the Company (commencing with the fiscal
quarter ending on September 30, 2002) during the periods
specified below, the Company will earn EBITDAL, for the period
of four consecutive fiscal quarters of the Company then ended,
in an amount not less (i) $986,000 for the four fiscal quarter
period ending September 30, 2002, (ii) $2,485,000 for the four
fiscal quarter period ending December 31, 2002, and (iii)
$5,000,000 for each four fiscal quarter period thereafter."
2.11. Borrowing Base Certificate. Exhibit B to the Credit
Agreement shall be and is hereby deleted in its entirety.
3. CONDITIONS PRECEDENT.
The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:
(a) The Borrowers and the Bank shall have executed and
delivered this Amendment.
(b) The Guarantors and each party signatory to that
certain Debt Subordination Agreement dated September 23, 1997 shall
have each executed and delivered to the Bank their consent to this
Amendment in the forms set forth below.
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(c) Legal matters incident to the execution and delivery of
this Amendment shall be satisfactory to the Bank and its counsel.
(d) The Company shall have paid to the Bank an amendment fee
in the amount of $10,500.
(e) The Company shall have deposited no less than $7,400,000
in cash into a collateral account with the Bank.
(f) The Company and the Bank shall have entered into an
amendment to the Security Agreement in form and substance acceptable to
the Bank.
4. REPRESENTATIONS.
In order to induce the Bank to execute and deliver this Amendment, the
Borrowers hereby represent to the Bank that as of the date hereof the
representations and warranties set forth in Section 6 of the Credit Agreement
are and shall be and remain true and correct (except as waived herein, and
except that the representations contained in Section 6.5 shall be deemed to
refer to the most recent financial statements of the Borrowers delivered to the
Bank) and, except as waived herein, the Borrowers are in compliance with the
terms and conditions of the Credit Agreement and no Default or Event of Default
has occurred and is continuing under the Credit Agreement or shall result after
giving effect to this Amendment.
5. MISCELLANEOUS.
5.1. The Borrowers heretofore executed and delivered to the Bank the
Security Agreement, Pledge Agreement and certain other Collateral Documents. The
Borrowers hereby acknowledge and agree that the Liens created and provided for
by the Collateral Documents continue to secure, among other things, the
Obligations arising under the Credit Agreement as amended hereby; and the
Collateral Documents and the rights and remedies of the Bank thereunder, the
obligations of the Borrowers thereunder, and the Liens created and provided for
thereunder remain in full force and effect and shall not (except as amended in
conjunction herewith) be affected, impaired or discharged hereby. Nothing herein
contained shall in any manner affect or impair the priority of the liens and
security interests created and provided for by the Collateral Documents as to
the indebtedness which would be secured thereby prior to giving effect to this
Amendment.
5.2. Except as specifically amended herein, the Credit Agreement shall
continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Credit Agreement,
the Note, or any other instrument or document executed in connection therewith,
or in any certificate, letter or communication issued or made pursuant to or
with respect to the Credit Agreement, any reference in any of such items to the
Credit Agreement being sufficient to refer to the Credit Agreement as amended
hereby.
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5.3. The Borrowers agree to pay on demand all costs and expenses of or
incurred by the Bank in connection with the negotiation, preparation, execution
and delivery of this Amendment, including the fees and expenses of counsel for
the Bank.
5.4. This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.
[SIGNATURE PAGE TO FOLLOW]
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This Ninth Amendment to Credit Agreement and Waiver is dated as of
September 30, 2002.
COMSHARE, INCORPORATED
By
Name__________________________________________
Title_________________________________________
COMSHARE LIMITED
By
Name__________________________________________
Title_________________________________________
Accepted and agreed to as of the date last above written.
HARRIS TRUST AND SAVINGS BANK
By
Name__________________________________________
Title_________________________________________
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GUARANTORS' ACKNOWLEDGEMENT AND CONSENT
Each of the undersigned Guarantors heretofore previously executed and
delivered to the Bank certain Loan Documents. Each of the undersigned hereby
consents to the Ninth Amendment to the Credit Agreement and Waiver (the
"Amendment") as set forth above and confirms that the Loan Documents executed
and delivered by it and all of the undersigned's obligations thereunder remain
in full force and effect and, without limiting the foregoing, each of the
undersigned acknowledges and agrees that notwithstanding the execution and
delivery of the Amendment, the Loan Documents executed and delivered by each of
the undersigned to the Agent remain in full force and effect and the rights and
remedies of the Agent and the Lenders, the obligations of each of the
undersigned thereunder and the liens and security interests provided for
thereunder remain in full force and effect and shall not be affected, impaired
or discharged hereby. Each of the undersigned further agree that the consent of
the undersigned to any further amendments to the Credit Agreement shall not be
required as a result of this consent having been obtained, except to the extent,
if any, required by the Loan Documents referred to above.
COMSHARE (U.S.), INC.
COMSHARE HOLDINGS COMPANY
COMSHARE LIMITED (CANADA)
By
Name________________________________
Title_______________________________
SUBORDINATED CREDITORS' ACKNOWLEDGEMENT AND CONSENT
Each of the undersigned heretofore executed in favor of the Bank a Debt
Subordination Agreement dated September 23, 1997. Each of the undersigned hereby
consent to the Ninth Amendment to Credit Agreement and Waiver as set forth above
and confirms that the Debt Subordination Agreement and all of the undersigned's
obligations thereunder remain in full force and effect. Each of the undersigned
further agree that the consent of the undersigned to any further amendments to
the Credit Agreement shall not be required as a result of this consent having
been obtained, except to the extent, if any, required by the Debt Subordination
Agreement referred to above.
COMSHARE, INCORPORATED
COMSHARE (U.S.), INC.
COMSHARE LIMITED
COMSHARE HOLDINGS COMPANY
COMSHARE LIMITED (CANADA)
By
Name_________________________________
Title________________________________