LIMITED WAIVER TO CREDIT AGREEMENT
EXHIBIT 10.27
LIMITED WAIVER TO
CREDIT AGREEMENT
CREDIT AGREEMENT
This Limited Waiver to Credit Agreement (this “Limited Waiver”), dated as of July 15, 2009, is
by and among SOFTBRANDS, INC., a Delaware corporation (the “Parent”), the subsidiaries of Parent
identified on the signature pages hereto (collectively, with the Parent, the “Borrowers” and
individually, a “Borrower”), XXXXX FARGO FOOTHILL, INC., a California corporation, as
Administrative Agent (the “Agent”) and each of the lenders parties hereto (the “Lenders”).
R E C I T A L S
A. The Borrowers, the Agent and the Lenders are parties to that certain Credit Agreement dated
as of August 14, 2006 (as amended, the “Credit Agreement”).
B. The Borrowers have requested a limited one-time waiver to the Borrowers’ non-compliance
with the Permitted Investment covenant, as provided herein.
C. The Agent and the Lenders are willing to waive such non-compliance, subject to the terms
and conditions of this Limited Waiver.
NOW, THEREFORE, in consideration of the premises herein contained, and for other good and
valuable consideration (the receipt, sufficiency and adequacy of which are hereby acknowledged),
the parties hereto (intending to be legally bound) hereby agree as follows:
1. Definitions. Terms capitalized herein and not otherwise defined herein shall have
the meanings ascribed to such terms in the Credit Agreement.
2. Limited Waiver. The Agent waives the Borrower’s non-compliance with Section 6.12 of
the Credit Agreement solely for the periods ending May 31, 2009 and June 30, 2009, with respect to
prohibiting the Administrative Borrower and its Subsidiaries from owning Investments, Cash
Equivalents, cash or any other funds in any location outside of the United States or China in an
aggregate amount in excess of $5,000,000 at any one time.
3. Conditions Precedent. The Limited Waiver contained in Section 2 above is
subject to, and contingent upon, the prior or contemporaneous satisfaction of each of the following
conditions precedent, each in form and substance satisfactory to the Agent:
(a) The Borrowers, the Agent and the Lenders shall have executed and delivered to each
other this Limited Waiver; and
(b) The Borrowers shall have satisfied any other conditions of the Agent required in
connection with this Limited Waiver.
4. Reference to and Effect on the Credit Agreement. Except as expressly provided
herein, the Credit Agreement and all of the Loan Documents shall remain unmodified and continue in
full force and effect and are hereby ratified and confirmed. Except as set forth in Section
4 above, the execution, delivery and effectiveness of this Limited Waiver shall not
operate as a waiver of: (a) any right, power or remedy of the Agent or the Lenders under the
Credit Agreement or any of the Loan Documents, or (b) any Default or Event of Default under the
Credit Agreement or any of the Loan Documents.
5. Representations and Warranties of the Borrowers. Each of the Borrowers hereby
represents and warrants to the Agent and the Lenders, which representations and warranties shall
survive the execution and delivery of this Limited Waiver, that on and as of the date hereof and
after giving effect to this Limited Waiver:
(a) As to each Borrower, the execution, delivery, and performance by such Borrower of
this Limited Waiver have been duly authorized by all necessary action on the part of such
Borrower.
(b) As to each Borrower, the execution, delivery, and performance by such Borrower of
this Limited Waiver does not and will not (i) violate any provision of federal, state, or
local law or regulation applicable to any Borrower, the Governing Documents of any Borrower,
or any order, judgment, or decree of any court or other Governmental Authority binding on
any Borrower, (ii) conflict with, result in a breach of, or constitute (with due notice or
lapse of time or both) a default under any material contractual obligation of any Borrower,
(iii) result in or require the creation or imposition of any Lien of any nature whatsoever
upon any properties or assets of Borrower, other than Permitted Liens, or (iv) require any
approval of any Borrower’s interest holders or any approval or consent of any Person under
any material contractual obligation of any Borrower, other than consents or approvals that
have been obtained and that are still in force and effect.
(c) As to each Borrower, this Limited Waiver and all other documents contemplated
hereby, when executed and delivered by such Borrower will be the legally valid and binding
obligations of such Borrower, enforceable against such Borrower in accordance with their
respective terms, except as enforcement may be limited by equitable principles or by
bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting
creditors’ rights generally.
(d) The representations and warranties of each of the Borrowers set forth in the Credit
Agreement and in the Loan Documents to which it is a party are true, correct and complete on
and as of the date hereof; provided that the references to the Credit Agreement therein
shall be deemed to include the Credit Agreement as modified by this Limited Waiver.
(e) Each of the Borrowers acknowledges that the Agent and each Lender is specifically
relying upon the representations, warranties and agreements contained in this Limited Waiver
and that such representations, warranties and agreements constitute a material inducement to
the Agent and each Lender in entering into this Limited Waiver.
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6. Reference to Credit Agreement; No Waiver.
The Agent’s and a Lender’s failure, at any time or times hereafter, to require
strict performance by the Borrowers of any provision or term of the Credit
Agreement, this Limited Waiver or the other Loan Documents shall not waive, affect
or diminish any right of the Agent or a Lender thereafter to demand strict
compliance and performance therewith. Any suspension or waiver by the Agent or a
Lender of a breach of this Limited Waiver or any Event of Default under the Credit
Agreement shall not, except as expressly set forth herein, suspend, waive or affect
any other breach of this Limited Waiver or any Event of Default under the Credit
Agreement, whether the same is prior or subsequent thereto and whether of the same
or of a different kind or character. None of the undertakings, agreements,
warranties, covenants and representations of any Borrower contained in this Limited
Waiver, shall be deemed to have been suspended or waived by the Agent or a Lender
unless such suspension or waiver is: (i) in writing and signed by the Agent and each
Lender and (ii) delivered to the Borrower. In no event shall the Agent’s and each
Lender’s execution and delivery of this Limited Waiver establish a course of dealing
among the Agent, each Lender, the Borrowers, or any other obligor or in any other
way obligate the Agent or each Lender to hereafter provide any amendments or waivers
with respect to the Credit Agreement. The terms and provisions of this Limited
Waiver shall be limited precisely as written and shall not be deemed: (A) to be a
consent to a modification or waiver of any other term or condition of the Credit
Agreement or of any other Loan Documents, or (B) to prejudice any right or remedy
that the Agent or each Lender may now have under or in connection with the Credit
Agreement or any of the other Loan Documents.
7. Successors and Assigns; Limited Waiver. This Limited Waiver shall be binding upon
and inure to the benefit of the parties hereto and their respective successors and assigns;
provided, however, no Borrower may assign this Limited Waiver or any of its
respective rights hereunder without the Agent’s and each Lender’s prior written consent. Any
prohibited assignment of this Limited Waiver shall be absolutely null and void. This Limited
Waiver may only be amended or modified by a writing signed by the Agent, each Lender and the
Borrowers.
8. Severability; Construction. Wherever possible, each provision of this Limited
Waiver shall be interpreted in such a manner so as to be effective and valid under applicable law,
but if any provision of this Limited Waivers held to be prohibited by or invalid under applicable
law, such provision or provisions shall be ineffective only to the extent of such provision and
invalidity, without invalidating the remainder of this Limited Waiver. Neither this Limited Waiver
nor any uncertainty or ambiguity herein shall be construed or resolved against Agent or each
Lender, whether under any rule of construction or otherwise. On the contrary, this Limited Waiver
has been reviewed by all parties hereto and shall be construed and interpreted according to the
ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of the
parties hereto.
9. Counterparts; Facsimile. This Limited Waiver may be executed in one or more
counterparts, each of which taken together shall constitute one and the same instrument.
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Delivery of an executed counterpart of this Limited Waiver by telefacsimile shall be equally
as effective as delivery of a manually executed counterpart of this Limited Waiver. Any party
delivering an executed counterpart of this Limited Waiver by telefacsimile shall also deliver a
manually executed counterpart of this Limited Waiver, but the failure to deliver a manually
executed counterpart shall not affect the validity, enforceability or binding effect of this
Limited Waiver.
10. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.
(a) THE VALIDITY OF THIS LIMITED WAIVER, THE CONSTRUCTION, INTERPRETATION, AND
ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING
HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.
(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS
LIMITED WAIVER SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN
THE COUNTY OF XXXX, STATE OF ILLINOIS, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY BORROWER COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH BORROWERS
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. BORROWER, AGENT AND THE LENDERS WAIVE, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF
FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS SECTION 10(b).
(c) BORROWERS, AGENT AND THE LENDERS HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY
TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS LIMITED WAIVER OR
ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH
OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. BORROWERS, AGENT AND THE
LENDERS REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND IT KNOWINGLY AND VOLUNTARILY WAIVES
ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, A COPY OF THIS LIMITED WAIVER MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY
THE COURT.
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IN WITNESS WHEREOF, the undersigned have caused this Limited Waiver to be duly executed and
delivered as of the date first above written.
| SoftBrands, Inc. a Delaware corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Title: CFO | ||||
| SoftBrands Manufacturing, Inc. a Minnesota corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Title: CFO | ||||
| SoftBrands International, Inc. a Delaware corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Title: CFO | ||||
| SoftBrands Licensing, Inc. a Delaware corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Its: CFO | ||||
| MAI Systems Corporation a Delaware corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Its: CFO | ||||
| Hotel Information Systems, Inc. a Delaware corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Its: CFO | ||||
| CLS Software International, Inc. a California corporation, as a Borrower |
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| By: | /s/ Xxxxx Xxxxxx | |||
| Its: CFO | ||||
| Xxxxx Fargo Foothill, Inc. a California corporation, as Agent and a Lender |
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| By: | /s/ Xxxxxxx Xxxxx | |||
| Its: Vice President | ||||
