<PAGE> 1
FORM 10-K/A
(AMENDMENT NO. 1)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE FISCAL YEAR ENDED JUNE 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from__________ to___________
Commission File Number 0-4096
COMSHARE, INCORPORATED
(Exact name of registrant as specified in its charter)
<TABLE>
<S><C>
MICHIGAN 38-1804887
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
555 BRIARWOOD CIRCLE, ANN ARBOR, MICHIGAN 48108
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (313) 994-4800
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock $1.00 Par Value
Rights to Purchase Preferred Shares
</TABLE>
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES [X] NO [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statement
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
The aggregate market value of the Common Stock held by non-affiliates of the
Registrant as of August 29, 1997 based on $8.19 per share, the last sale price
for the Common Stock on such date as reported on the Nasdaq Stock Market -
National Market System, was approximately $77,668,000.
As of August 29, 1997 the Registrant had 9,871,773 shares of Common Stock
outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Document
Portions of Proxy Statement for the Part of Form 10-K Report
1997 Annual Meeting of Shareholders into which it is incorporated
("The 1997 Proxy Statement") III
<PAGE> 2
The registrant files this Form 10-K/A (Amendment No. 1) solely to
revise the Index to Exhibits and to refile Exhibits 23.01 and 99.00.
<PAGE> 3
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
Dated: OCTOBER 1, 1997 COMSHARE, INCORPORATED
By: /s/ Kathryn A. Jehle
--------------------
Kathryn A. Jehle
Senior Vice President,
Chief Financial Officer,
Treasurer and Assistant Secretary
<PAGE> 4
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
3.01 Restated Articles of Incorporation of the Registrant, as amended -
incorporated by reference to Exhibit 3.02 to the Registrant's 10-K
Report for the fiscal year ended June 30, 1996.
3.02 Bylaws of the Registrant, as amended - incorporated by reference to
Exhibit 3.02 to the Registrant's 10-K Report for the fiscal year ended
June 30, 1995.
4.01 Specimen form of Common Stock Certificate - incorporated by reference to
Exhibit 4(c) to the Registrant's Form S-1 Registration Statement No.
2-29663.
4.02* Credit agreement dated September 23, 1997 among Comshare, Incorporated,
its Borrowing Subsidiary (as defined therein) and Harris Trust and
Savings Bank.
4.03 Rights Agreement, dated as of September 16, 1996, between Comshare,
Incorporated and KeyBank National Association, as Rights Agent -
incorporated by reference to Exhibit 2 to the Registrant's Registration
Statement on Form 8-A, filed on September 17, 1996.
4.04 Form of certificate representing Rights (included as Exhibit B to the
form of Rights Agreement filed as Exhibit 4.03). Pursuant to the
Rights Agreement, Rights Certificates will not be mailed until after
the earlier of (i) the tenth business day (or such later date as may be
determined by the Board of Directors, with the concurrence of a
majority of the Continuing Directors, prior to such time as any person
becomes an Acquiring Person) after the date of the commencement of, or
first public announcement of the intent to commence, a tender or
exchange offer by any person or group of affiliated or associated
persons (other than the Company or certain entities affiliated with or
associated with the Company), if, upon consummation thereof, such
person or group of affiliated or associated persons would be the
beneficial owner of 15% or more of such outstanding shares of common
stock - incorporated by reference to Exhibit 1 to the Registrant's
Registration Statement on Form 8-A, filed on September 17, 1996.
10.01 Benefit Adjustment Plan of Comshare, Incorporated, effective June 1,
1986, as amended - incorporated by reference to Exhibit 10.20 to the
Registrant's Form 10-K Report for the fiscal year ended June 30, 1993.
10.02 Comshare, Incorporated 1988 Stock Option Plan, as amended - incorporated
by reference to Exhibit 10.21 to the Registrant's Form 10-K Report for
the fiscal year ended June 30, 1990 and Exhibit 10.22 to the
Registrant's Form 10-Q Report for the quarter ended September 30, 1994.
10.03 Amended and Restated Profit Sharing Plan of Comshare, Incorporated,
effective as of October 1, 1995 - incorporated by reference to Exhibit
4.1 to the Registrant's Form S-8 Registration Statement No. 33-65109.
10.04 Rules of the Comshare Retirement and Death Benefits Plan for employees
of the United Kingdom, effective January 1, 1991, as amended -
incorporated by reference to Exhibit 10.27 to the Registrant's Form
10-K Report for the fiscal year ended June 30, 1993.
10.05* Deed of Variation relating to the Comshare Retirement and Death Benefits
Plan for employees of United Kingdom, dated July 30, 1997.
10.06 Interim Trust Deed establishing the Comshare Money Purchase Plan for
employees of the United Kingdom, effective March 1, 1994 - incorporated
by reference to Exhibit 10.08 to the Registrant's Form 10-K for the
fiscal year ended June 30, 1994
10.07 Employment and NonCompetition Agreement between Comshare, Incorporated
and T. Wallace Wrathall, effective as of April 1, 1994 - incorporated by
reference to Exhibit 10.23 to the Registrant's Form 10-Q Report for the
quarter ended December 31, 1994.
48
<PAGE> 5
10.08 Amended and Restated Employee Agreement between Comshare,Incorporated
and Richard L. Crandall effective July 1, 1994, as amended -
incorporated by reference to Exhibit 10.10 to the Registrant's Form 10-K
for the fiscal year ended June 30, 1994.
10.09 Non-Competition Agreement between Comshare, Incorporated and Richard L.
Crandall - incorporated by reference to Exhibit 10.11 of the
Registrant's Form 10-K for the fiscal year ended June 30, 1994.
(Portions of this exhibit have been omitted and filed separately with
the Securities and Exchange Commission pursuant to a request for
confidential treatment pursuant to Rule 24b-2).
10.10 Letter Agreement from Comshare, Incorporated to Kathryn A. Jehle
regarding terms of employment dated April 18, 1994 - incorporated by
reference to Exhibit 10.12 to the Registrant's Form 10-K for the fiscal
year ended June 30, 1994.
10.11 Description of Incentive Arrangements for certain executive officers for
fiscal years 1994 and 1995-2000 - incorporated by reference to Exhibit
10.12 to the Registrant's Form 10-K Report for the fiscal year ended
June 30, 1996.
10.12 Stock Option Agreement, effective as of March 10, 1997, between
Comshare, Incorporated and Daniel T. Carroll - incorporated by
reference to Exhibit 10.22 to the Registrant's Form 10-Q Report for the
quarter ended March 31, 1997.
10.13 Trust Agreement under the Benefit Adjustment Plan of Comshare,
Incorporated, effective April 25, 1988, as amended - incorporated by
reference to Exhibit 10.31 to the Registrant's Form 10-K Report for the
fiscal year ended June 30, 1993.
10.14 Trust Agreement between Comshare, Incorporated and Vanguard
Fiduciary for maintaining the Profit Sharing Plan of Comshare,
Incorporated effective March 31, 1992, as amended - incorporated by
reference to Exhibit 10.15 to the Registrant's Form 10-K for the fiscal
year ended June 30, 1994.
10.15 1994 Executive Stock Purchase Program of Comshare, Incorporated -
incorporated by reference to Exhibit 10.19 to the Registrant's Form
10-Q Report for the quarter ended September 30, 1994.
10.16 Employee Stock Purchase Plan of Comshare, Incorporated - incorporated by
reference to Exhibit 10.20 to the Registrant's Form 10-Q Report for the
quarter ended September 30, 1994.
10.17 1994 Directors Stock Option Plan of Comshare, Incorporated -
incorporated by reference to Exhibit 10.21 to the Registrant's Form
10-Q Report for the quarter ended September 30, 1994.
10.18* Letter of understanding between Comshare, Incorporated and Steven J.
Tonissen regarding employment termination dated August 4, 1997.
10.19* Agreement between Comshare, Incorporated and Dion T. O'Leary dated July
9, 1997.
10.20* Letter agreement between Comshare, Incorporated and Geoffrey R. Cluett
dated April 29, 1997 regarding term of employment and non-compete
agreement.
10.21 Lease dated September, 1994, between Comshare, Incorporated, Tenant and
MGI Holding, Inc., Landlord for office space located at 555 Briarwood
Circle, Ann Arbor, Michigan 48108 - incorporated by reference to Exhibit
10.18 to the Registrant's Form 10-Q Report for the quarter ended
September 30, 1994.
10.22 Agreement between Taurusbuild Limited, Comshare and Svenska
Handelsbanken related to the lease of office space for the Company's
London office facility - incorporated by reference to Exhibit 10.17 of
the Registrant's Form 10-K Report for the fiscal year ended June 30,
1994.
10.23 Software License Agreement by and between Arbor Software Corporation and
Comshare, Incorporated dated December 23, 1993 - incorporated by
reference to Exhibit 10.20 to Amendment Number 3 to the Registrant's
Form 10-K Report, filed November 8, 1995, for the fiscal year ended June
30, 1995. (Portions
49
<PAGE> 6
of this exhibit have been omitted and filed separately with the
Securities and Exchange Commission pursuant to a request for
confidential treatment pursuant to Rule 24b-2).
10.24 First Amendment to License Agreement by and between Arbor Software
Corporation and Comshare, Incorporated dated March 1, 1994 -
incorporated by reference to Exhibit 10.20 to the Registrant's Form
10-K Report for the fiscal year ended June 30, 1995. (Portions of
this exhibit have been omitted and filed separately with the
Securities and Exchange Commission pursuant to a request for
confidential treatment pursuant to Rule 24b-2).
11.1* Computation of per share earnings.
21.01* Subsidiaries of the Registrant.
23.01** Consent of Independent Public Accountants.
27.00* Financial Data Schedule.
99.00** Amended and Restated Profit Sharing Plan of Comshare, Incorporated,
Form 11-K Annual Report - filed pursuant to Section 15(d) of
the Securities Exchange Act of 1934 for the fiscal year ended June 30,
1997.
- ----------------------------
* Previously filed.
** Filed herewith.
50
<PAGE> 1
EXHIBIT 23.01
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the incorporation by
reference of our report on the June 30, 1997 consolidated financial state-
ments of Comshare, Incorporated and subsidiaries dated September 23, 1997,
included in this Form 10-K, into the Company's previously filed Form S-8 and
S-3 registration statements (File No. 33-6730, File No. 33-9755-3, File No.
33-28437, File No. 33-27002, File No. 33-37564, File No. 33-85720, File No.
33-87706, File No. 33-87708, File No. 33-86908 and File No. 33-65109).
/s/ ARTHUR ANDERSEN LLP
--------------------------
ARTHUR ANDERSEN LLP
Detroit, Michigan
September 25, 1997
<PAGE> 1
EXHIBIT 99.00
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
[X] 1934 [FEE REQUIRED] FOR THE FISCAL YEAR ENDED JUNE 30, 1997
OR
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM _________________
[ ] TO ____________________COMMISSION FILE NUMBER_____________________________
Profit Sharing Plan of Comshare, Incorporated
Full Title of the plan.
Comshare, Incorporated, 555 Briarwood Circle, Ann Arbor, MI 48108
Name of issuer of securities held pursuant to the plan
and the address of its principal executive offices.
<PAGE> 2
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
FINANCIAL STATEMENTS AS OF JUNE 30, 1997 AND 1996
AND FOR THE THREE YEARS ENDED JUNE 30, 1997
TOGETHER WITH AUDITORS' REPORT
<PAGE> 3
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator
of the Profit Sharing Plan
of Comshare, Incorporated:
We have audited the accompanying statements of net assets available for
benefits of the PROFIT SHARING PLAN OF COMSHARE, INCORPORATED (the "Plan") as
of June 30, 1997 and 1996, and the related statements of changes in net assets
available for benefits for the years ended June 30, 1997, 1996 and 1995. These
financial statements and the schedules referred to below are the responsibility
of the Plan's management. Our responsibility is to express an opinion on these
financial statements and schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as
of June 30, 1997 and 1996 and the changes in net assets available for benefits
for the years ended June 30, 1997, 1996 and 1995 in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes and reportable transactions are presented for the
purposes of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated, in
all material respects, in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
Detroit, Michigan,
September 19, 1997.
<PAGE> 4
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
Statements of Net Assets Available for Benefits as of
June 30, 1997 and 1996
Statements of Changes in Net Assets Available for Benefits
for the Years Ended June 30, 1997, 1996 and 1995
Notes to Financial Statements
SCHEDULES
I. Item 27a - Schedule of Assets Held
for Investment Purposes as of June 30, 1997
II. Item 27d - Schedule of Reportable Transactions
for the Year Ended June 30, 1997
<PAGE> 5
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF JUNE 30, 1997
<TABLE>
<CAPTION>
Vanguard
Vanguard Vanguard Vanguard Vanguard Vanguard International
Money Market- Bond Index Index 500 Wellington U.S. Growth Value
Prime Portfolio Fund Portfolio Fund Portfolio Portfolio
-------------- ----------- ----------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
RECEIVABLES:
Employer's contribution $ 60,999 $ 26,017 $ 137,162 $ 47,505 $ 64,742 $ 16,580
Participants' contributions 13,511 7,250 49,207 18,990 28,971 8,436
Accrued loan repayments 3,178 923 6,398 2,304 3,076 522
---------- ---------- ----------- ---------- ---------- ----------
77,688 34,190 192,767 68,799 96,789 25,538
INVESTMENTS, at market:
Registered Investment Companies 2,721,591 1,395,409 13,291,055 2,465,188 3,314,385 860,658
Company Stock Fund -- -- -- -- -- --
Loans to participants -- -- -- -- -- --
---------- ---------- ----------- ---------- ---------- ----------
2,721,591 1,395,409 13,291,055 2,465,188 3,314,385 860,658
NET ASSETS AVAILABLE
FOR BENEFITS $2,799,279 $1,429,599 $13,483,822 $2,533,987 $3,411,174 $886,196
========== ========== =========== ========== ========== ==========
<CAPTION>
Comshare Loan 1997
Stock Fund Fund Total
---------- ---------- ----------
<S> <C> <C> <C>
RECEIVABLES:
Employer's contribution $ 14,693 $ -- $ 367,698
Participants' contributions 8,476 -- 134,841
Accrued loan repayments 1,725 -- 18,126
---------- --------- -----------
24,894 -- 520,665
INVESTMENTS, at market:
Registered Investment Companies -- -- 24,048,286
Company Stock Fund 1,727,122 -- 1,727,122
Loans to participants -- 718,567 718,567
---------- --------- -----------
1,727,122 718,567 26,493,975
NET ASSETS AVAILABLE
FOR BENEFITS $1,752,016 $ 718,567 $27,014,640
========== ========= ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 6
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF JUNE 30, 1996
<TABLE>
<CAPTION>
Vanguard Vanguard Vanguard Vanguard Vanguard
Money Market- Bond Index Index 500 Wellington U.S. Growth
Prime Portfolio Fund Portfolio Fund Portfolio
---------------- --------------- ----------------- ---------------- -----------------
<S> <C> <C> <C> <C> <C>
RECEIVABLES:
Employer's contribution $ 56,579 $ 55,851 $ 256,124 $ 104,117 $ 98,407
Participants' contributions 11,045 7,593 46,175 18,776 22,138
Accrued loan repayments 3,189 1,175 5,279 1,588 2,347
---------- ---------- ----------- ---------- ----------
70,813 64,619 307,578 124,481 122,892
INVESTMENTS, at market:
Registered Investment
Companies 3,065,717 1,687,144 10,395,281 2,309,281 2,999,767
Company Stock Fund -- -- -- -- --
Loans to participants -- -- -- -- --
---------- ---------- ----------- ---------- ----------
3,065,717 1,687,144 10,395,281 2,309,281 2,999,767
NET ASSETS AVAILABLE
FOR BENEFITS $3,136,530 $1,751,763 $10,702,859 $2,433,762 $3,122,659
========== ========== =========== ========== ==========
<CAPTION>
Vanguard
International
Value Comshare Loan 1996
Portfolio Stock Fund Fund Total
---------------- --------------- -------- -----------
<S> <C> <C> <C> <C>
RECEIVABLES:
Employer's contribution $ 28,973 $ 15,913 $ -- $ 615,964
Participants' contributions 8,019 4,274 -- 118,020
Accrued loan repayments 926 741 -- 15,245
---------- ---------- -------- -----------
37,918 20,928 749,229
INVESTMENTS, at market:
Registered Investment
Companies 1,083,123 -- -- 21,540,313
Company Stock Fund -- 3,960,341 -- 3,960,341
Loans to participants -- -- 635,662 635,662
---------- ---------- -------- -----------
1,083,123 3,960,341 635,662 26,136,316
NET ASSETS AVAILABLE
FOR BENEFITS $1,121,041 $3,981,269 $635,662 $26,885,545
========== ========== ======== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 7
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED JUNE 30, 1997
<TABLE>
<CAPTION>
Vanguard
Vanguard Vanguard Vanguard Vanguard Vanguard International
Money Market- Bond Index Index 500 Wellington U.S.Growth Value
INVESTMENT INCOME: Prime Portfolio Fund Portfolio Fund Portfolio Portfolio
------------------- ---------- ------------ ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Unrealized appreciation (depreciation)
of investments $ -- $ 13,776 $ 2,988,259 $ 292,461 $ 486,517 $ (10,758)
Interest and dividend income 158,926 99,058 257,917 180,140 260,689 188,680
Realized gain (loss) on investments -- 3,367 147,785 22,078 57,140 (59,278)
----------- ---------- ----------- ---------- ---------- ----------
158,926 116,201 3,393,961 494,679 804,346 118,644
CONTRIBUTIONS:
Employer 109,690 59,534 321,794 111,672 152,579 41,359
Participants 193,117 114,355 715,440 279,178 442,913 136,118
----------- ---------- ----------- ---------- ---------- ----------
302,807 173,889 1,037,234 390,850 595,492 177,477
LOAN ORIGINATIONS (79,667) (23,769) (135,939) (48,973) (53,371) (7,120)
LOAN REPAYMENTS 77,471 19,113 95,655 36,872 42,061 18,271
INTERFUND TRANSFERS, NET 843,753 (422,305) (363,905) (449,832) 308,703 (199,170)
DISTRIBUTIONS TO PARTICIPANTS (1,640,541) (185,293) (1,246,043) (323,371) (1,408,716) (342,947)
----------- ---------- ----------- ---------- ---------- ----------
Increase (Decrease) in Net Assets
Available for Benefits (337,251) (322,164) 2,780,963 100,225 288,515 (234,845)
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR 3,136,530 1,751,763 10,702,859 2,433,762 3,122,659 1,121,041
----------- ---------- ----------- ---------- ---------- ----------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $ 2,799,279 $1,429,599 $13,483,822 $2,533,987 $3,411,174 $ 886,196
=========== ========== =========== ========== ========== ==========
<CAPTION>
Comshare Loan 1997
INVESTMENT INCOME: Stock Fund Fund Total
------------ ---------- ------------------
<S> <C> <C> <C>
Unrealized appreciation (depreciation)
of investments $(1,581,935) $ -- $ 2,188,320
Interest and dividend income -- 67,303 1,212,713
Realized gain (loss) on investments (749,905) -- (578,813)
----------- --------- -----------
(2,331,840) 67,303 2,822,220
CONTRIBUTIONS:
Employer 22,063 -- 818,691
Participants 89,656 -- 1,970,777
----------- --------- -----------
111,719 -- 2,789,468
LOAN ORIGINATIONS (58,658) 407,497 --
LOAN REPAYMENTS 34,110 (323,553) --
INTERFUND TRANSFERS, NET 282,756 -- --
DISTRIBUTIONS TO PARTICIPANTS (267,340) (68,342) (5,482,593)
----------- --------- -----------
Increase (Decrease) in Net Assets
Available for Benefits (2,229,253) 82,905 129,095
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR 3,981,269 635,662 26,885,545
----------- --------- -----------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $ 1,752,016 $ 718,567 $27,014,640
=========== ========= ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 8
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED JUNE 30, 1996
<TABLE>
<CAPTION>
Vanguard
Vanguard Vanguard Vanguard Vanguard Vanguard International
Money Market- Bond Index Index 500 Wellington U.S.Growth Value
Prime Portfolio Fund Portfolio Fund Portfolio Portfolio
---------------- ---------- ------------ ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Unrealized appreciation (depreciation)
of investments $ -- $ (30,758) $ 1,674,861 $ 196,661 $ 472,563 $ 10,636
Interest and dividend income 178,792 107,802 219,446 120,986 82,532 95,269
Realized gain on investments -- 937 141,928 47,203 31,118 5,530
---------- ---------- ----------- ---------- ---------- ----------
178,792 77,981 2,036,235 364,850 586,213 111,435
CONTRIBUTIONS:
Employer 97,516 95,724 434,895 180,635 156,646 56,055
Participants 242,547 166,416 587,678 265,954 238,877 109,048
---------- ---------- ----------- ---------- ---------- ----------
340,063 262,140 1,022,573 446,589 395,523 165,103
TRANSFER OF ASSETS FROM
OTHER PLANS -- -- -- -- -- --
LOAN ORIGINATIONS (67,911) (36,006) (93,771) (28,087) (28,488) (7,880)
LOAN REPAYMENTS 77,916 21,485 123,139 50,137 47,321 21,707
INTERFUND TRANSFERS, NET (798,285) (168,273) 845,839 152,052 569,951 (15,567)
DISTRIBUTIONS TO PARTICIPANTS (392,844) (63,287) (1,309,944) (475,426) (106,104) (56,811)
---------- ---------- ----------- ---------- ---------- ----------
Increase (decrease) in Net Assets (662,269) 94,040 2,624,071 510,115 1,464,416 217,987
Available for Benefits
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR 3,798,799 1,657,723 8,078,788 1,923,647 1,658,243 903,054
---------- ---------- ----------- ---------- ---------- ----------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $3,136,530 $1,751,763 $10,702,859 $2,433,762 $3,122,659 $1,121,041
========== ========== =========== ========== ========== ==========
<CAPTION>
Comshare Loan 1996
Stock Fund Fund Total
----------- ---------- -----------
<S> <C> <C> <C>
INVESTMENT INCOME:
Unrealized appreciation (depreciation)
of investments $1,424,698 $ -- $ 3,748,661
Interest and dividend income -- 53,701 858,528
Realized gain on investments 177,244 -- 403,960
---------- --------- -----------
1,601,942 53,701 5,011,149
CONTRIBUTIONS:
Employer 18,778 -- 1,040,249
Participants 40,930 -- 1,651,450
---------- --------- -----------
59,708 -- 2,691,699
TRANSFER OF ASSETS FROM
OTHER PLANS 3,183,333 -- 3,183,333
LOAN ORIGINATIONS (61,411) 323,554 --
LOAN REPAYMENTS 3,122 (344,827) --
INTERFUND TRANSFERS, NET (585,717) --
DISTRIBUTIONS TO PARTICIPANTS (219,708) (11,190) (2,635,314)
---------- --------- -----------
Increase (decrease) in Net Assets 3,981,269 21,238 8,250,867
Available for Benefits
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR -- 614,424 18,634,678
---------- --------- -----------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $3,981,269 $ 635,662 $26,885,545
========== ========= ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 9
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED JUNE 30, 1995
<TABLE>
<CAPTION>
Vanguard
Vanguard Vanguard Vanguard Vanguard Vanguard International
Money Market- Bond Index Index 500 Wellington U.S.Growth Value
Prime Portfolio Fund Portfolio Fund Portfolio Portfolio
--------------- ------------- ------------ ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Unrealized appreciation (depreciation)
of investments $ -- $ 76,028 $ 1,317,955 $ 219,092 $ 246,207 $ (26,308)
Interest and dividend income 215,539 107,263 207,110 75,542 9,333 42,870
Realized gain (loss) on investments -- (3,635) 141,397 14,376 12,981 (19,061)
----------- ---------- ----------- ---------- ---------- ---------
215,539 179,656 1,666,462 309,010 268,521 (2,499)
CONTRIBUTIONS:
Employer 146,227 87,651 321,337 129,416 89,099 54,274
Participants 290,831 131,045 525,878 210,493 139,318 105,377
----------- ---------- ----------- ---------- ---------- ---------
437,058 218,696 847,215 339,909 228,417 159,651
LOAN ORIGINATIONS (60,361) (22,769) (81,743) (33,744) (44,223) (4,840)
LOAN REPAYMENTS 106,026 45,034 216,657 31,785 22,643 23,266
INTERFUND TRANSFERS, NET (95,951) (176,643) (634,641) (259,828) 724,844 442,219
DISTRIBUTIONS TO PARTICIPANTS (1,313,081) (393,804) (1,573,917) (210,204) (151,539) (213,255)
----------- ---------- ----------- ---------- ---------- ---------
Increase (decrease) in Net Assets (710,770) (149,830) 440,033 176,928 1,048,663 404,542
Available for Benefits
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR 4,509,569 1,807,553 7,638,755 1,746,719 609,580 498,512
----------- ---------- ----------- ---------- ---------- ---------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $ 3,798,799 $1,657,723 $ 8,078,788 $1,923,647 $1,658,243 $ 903,054
=========== ========== =========== ========== ========== =========
<CAPTION>
Loan 1995
Fund Total
---------- ------------
<S> <C> <C>
INVESTMENT INCOME:
Unrealized appreciation (depreciation)
of investments $ -- $ 1,832,974
Interest and dividend income 66,753 724,410
Realized gain (loss) on investments -- 146,058
--------- -----------
66,753 2,703,442
CONTRIBUTIONS:
Employer -- 828,004
Participants -- 1,402,942
--------- -----------
-- 2,230,946
LOAN ORIGINATIONS 247,680 --
LOAN REPAYMENTS (445,411) --
INTERFUND TRANSFERS, NET -- --
DISTRIBUTIONS TO PARTICIPANTS (55,821) (3,911,621)
--------- -----------
Increase (decrease) in Net Assets (186,799) 1,022,767
Available for Benefits
NET ASSETS AVAILABLE FOR
BENEFITS BEGINNING OF YEAR 801,223 17,611,911
--------- -----------
NET ASSETS AVAILABLE FOR
BENEFITS END OF YEAR $ 614,424 $18,634,678
========= ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 10
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
(1) DESCRIPTION OF THE PLAN
The information discussed below is a summary only and reference should be
made to the Profit Sharing Plan of Comshare, Incorporated (the "Plan") or
inquiries made of the Plan Administrator for more complete information.
(a) General
The Plan is a defined contribution plan covering eligible employees of
Comshare, Incorporated (the "Company"). The Plan provides retirement
benefits and is subject to the provisions of the Employee Retirement
Income Security Act of 1974 (ERISA). The Company administers the Plan
and pays all plan administration costs, including fees paid to the
Trustee. The operating expenses of the investment advisor are netted
from the returns of the funds.
The Employee Stock Ownership Plan (ESOP) of Comshare Incorporated was
merged with the Plan effective October 1, 1995. All of the assets of
the ESOP which consisted primarily of Comshare common stock were
transferred to the Plan and placed in the new Comshare Stock Fund.
(b) Trustee and Investment Advisor
As of June 30, 1997 the Plan held all investments with Vanguard
Fiduciary Trust Company (the "Trustee" and "Investment Advisor").
In accordance with the Trust Agreement, the Trustee holds and
administers the Plan's assets and executes transactions therewith for
the purpose of providing benefits as described in the Plan agreement.
The Investment Advisor executes all investment transactions.
(c) Management Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from
those estimates.
(d) Contributions
The Plan provides for annual employer fixed contributions equal to 2%
of eligible participants' compensation. In addition, the Company may
make discretionary contributions, the amount of which is determined by
the Board of Directors. There were no discretionary contributions in
1997 or 1995. The discretionary contributions in 1996 were $234,000.
To qualify for such employer contributions for any given Plan year, a
participant must be credited with 1,000 or more hours of service during
the Plan year and be employed by the Company on the last day of the
Plan year.
<PAGE> 11
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
(continued)
Participants may make before-tax contributions, subject to Internal
Revenue Service limitations. Participants are eligible for employer
matching contributions equal to 50% of the participant's before-tax
contributions up to 6% of their compensation.
(e) Investment Options
As of June 30, 1997 the investment options available to participants
are as follows: (1) Vanguard Money Market - Prime Portfolio, a money
market fund, consisting of investments with maturities of one year or
less; (2) Vanguard Bond Index Fund, an intermediate bond fund,
consisting primarily of investments in U.S. Government and corporate
bonds; (3) Vanguard Index 500 Portfolio, a diversified equity fund,
consisting of investments in the stocks included in the Standard &
Poors' 500 Index; (4) Vanguard Wellington Fund, a balanced fund,
consisting of investments in both stocks and bonds; (5) Vanguard United
States Growth Portfolio, a growth stock fund, consisting of investments
in common stocks of companies with above-average growth potential; (6)
Vanguard International Value Portfolio, an international equity fund,
consisting of investments in stocks of companies based outside the
United States; (7) Comshare Stock Fund, a fund investing in the common
stock of Comshare, Inc. There are no guaranteed rates of returns for
these funds.
Participants may change their investment election daily for new
contributions or loans repaid to the Plan. Contributions to the Plan
are invested directly by the Trustee into the investment options based
on participant elections.
(f) Vesting and Eligibility
All full-time employees and certain part-time employees are eligible to
make employee before-tax contributions to the Plan at the beginning of
the calendar quarter following the date of hire. Eligible participants
begin sharing in employer contributions after completing one year of
service. As of June 30, 1997 there were 332 active participants.
Participants vest in employer discretionary contributions according to
a seven year schedule. Participants completing at least 1,000 hours of
service in a given plan year are credited with an increase in vesting
for such plan year. Full vesting also occurs upon retirement at age
65, or after death or total disability. Employer matching
contributions vest according to a seven year schedule for participants
with targeted compensation greater than the social security wage base.
All other participants are fully vested in employer matching
contributions.
Employee contributions and employer fixed contributions are always fully
vested.
<PAGE> 12
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
(continued)
(g) Loans and Hardship Withdrawals
The Plan provides for hardship withdrawals in certain circumstances and
for loans to participants. Loans are limited to 50% of a participant's
vested balance, and bear interest comparable to competitive bank rates
for loans of similar purpose. Loans are repaid through payroll
withholding, and typically mature within five years with a maximum
maturity of twenty years. A 10% excise tax is imposed upon hardship
withdrawals.
(h) Benefit Distributions
Distribution of the vested amounts in a participant's account can be
made upon termination of employment or upon retirement. Benefits are
paid, at the option of the participant, in a lump sum payment or in
periodic payments of substantially equal amounts for a specified number
of years, not to exceed ten.
(i) Benefits Payable
As of June 30, 1997 and 1996, the net assets available for benefits
included $1,501,183 and $808,841, respectively, for benefits payable
that were due but undistributed to participants as a result of
termination of employment or retirement. These amounts are shown as
liabilities on Form 5500 and are the only reconciling item between the
financial statements and Form 5500.
(j) Allocation to Participants' Accounts
The Trustee maintains the detailed accounts of the net assets available
for benefits in the Plan. The Trustee values the fund for each
investment option at market value on a daily basis. The net change in
each fund's market value for the period is allocated to the accounts of
participants within that fund in the same proportion that the balance
of each participant's account bears to the total of the fund on the
last day of the period. Interest income on loans to participants is
credited directly to the individual participant's account. Company
discretionary contributions and forfeitures are allocated to eligible
participants' accounts in the same proportion that the participant's
eligible compensation bears to the total eligible compensation of all
participants for the year.
(k) Plan Termination
Although it has not expressed the intent to do so, the Company has the
right to terminate the Plan subject to the provisions of ERISA. In the
event the Plan is terminated, the participants will become fully vested
and will receive the balances in their individual accounts.
(l) Federal Income Tax Status
The Plan obtained its latest determination letter dated September 16,
1996, in which the Internal Revenue Service stated that the Plan, as
amended and restated effective July 1, 1994, was in compliance with the
applicable requirements of the Internal Revenue Code (the "Code").
The Plan has subsequently been amended and restated effective October
1, 1995 to reflect the merger with the ESOP. The Plan administrator
is applying for a new determination letter. The Plan administrator and
the Plan's tax counsel believe that the Plan is currently designed and
being operated in compliance with the applicable requirements of the
Code.
<PAGE> 13
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
(continued)
Therefore, they believe that the Plan was qualified and the related
trust was tax-exempt as of the financial statement date.
(m) Forfeitures
Non-vested account balances of terminated employees are forfeited at
the end of the quarter following the date of termination. Forfeitures
were $33,657, $62,517 and $26,714 for the years ended June 30, 1997,
1996 and 1995, respectively. Forfeitures are allocated on a pro-rata
basis to remaining participants.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Accounting
The financial statements have been prepared on the accrual basis of
accounting.
(b) Investments
Investment transactions are recorded by the Trustee on a trade date
basis. Investments are stated in the Statement of Net Assets Available
for Benefits at market value. Realized gains and losses on sale of
investments and unrealized appreciation (depreciation) of investments
are computed based on the difference between the market value of the
investments at the beginning of the year, or at the time of purchase if
acquired during the year, and the market value of investments when sold
or at Plan year end.
(3) REPORTABLE TRANSACTIONS
Transactions, or a series of transactions, in excess of 5% of Net Assets
Available for Benefits at the beginning of the Plan year are reportable
transactions under the provisions of ERISA. A list of such transactions is
included in Schedule II.
(4) SUBSEQUENT EVENTS
As of September 19, 1997, the Company's stock was trading at $8.375 per
share compared to $12.375 per share at June 30, 1997. The investments in
the Comshare Stock Fund consist primarily of the Company's stock which is
valued in the accompanying Statement of Net Assets Available for Benefits at
the June 30, 1997 share price.
<PAGE> 14
SCHEDULE I
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
EIN: 38-1804887 PN: 001
ITEM 27a - SCHEDULE OF ASSETS
HELD FOR INVESTMENT PURPOSES AS OF JUNE 30, 1997
<TABLE>
<CAPTION>
(c) Description of Investment
(a) (b) Identity of Issue, Including Maturity Date, (e)
Borrower, Lessor, Rate of Interest, Collateral, (d) Current
or Similar Party Par or Maturity Value Cost Value
-------------------------- -------------------------------- ----------- -----------
<S> <C> <C> <C> <C>
MUTUAL FUNDS:
* Vanguard Group 2,721,591 units of Money $ 2,721,591 $ 2,721,591
Market - Prime Portfolio
* Vanguard Group 118,923 units of Bond 1,390,869 1,395,409
Index Fund
* Vanguard Group 160,656 units of Index 7,890,905 13,291,055
500 Portfolio
* Vanguard Group 84,831 units of Wellington 1,949,000 2,465,188
Fund
* Vanguard Group 118,923 units of U.S. Growth 2,423,066 3,314,385
Portfolio
* Vanguard Group 28,536 units of International 873,067 860,658
Value Portfolio
* Vanguard Group 279,922 units of Comshare Stock 1,445,860 1,727,122
Fund ----------- -----------
Total Mutual Funds 18,694,358 25,775,408
----------- -----------
LOANS:
Loans to plan participants Interest rates range 718,567 718,567
from 6.5% to 12.25%; ----------- -----------
maturing through December, 2016
TOTAL INVESTMENTS $19,412,925 $26,493,975
=========== ===========
</TABLE>
* Represents a party-in-interest
<PAGE> 15
SCHEDULE II
PROFIT SHARING PLAN
OF COMSHARE, INCORPORATED
EIN: 38-1804887 PN: 001
ITEM 27D - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED JUNE 30, 1997
<TABLE>
<CAPTION>
(a) (b) (c) (d) (g)
Identity of Party Description of Purchase Selling Cost of
Involved Asset Price Price Asset
- ----------------- ---------------------------------------------------- ---------------- --------------- -------------
<S> <C> <C> <C> <C>
Vanguard Group 104 purchases of shares of Vanguard $2,571,862 N/A N/A
Money Market - Prime Portfolio
Vanguard Group 90 purchases of shares of Vanguard Index 2,805,964 N/A N/A
500 Portfolio
Vanguard Group 70 purchases of shares of Vanguard U.S. 1,987,883 N/A N/A
Growth Portfolio
Vanguard Group 57 purchases of shares of Vanguard Wellington Fund 845,236 N/A N/A
Vanguard Group 74 purchases of shares of Comshare Stock Fund 2,275,493 N/A N/A
Vanguard Group 76 sales of shares of Vanguard Money N/A $2,915,987 $2,915,987
Market - Prime Portfolio
Vanguard Group 74 sales of shares of Vanguard Index 500 Portfolio N/A 3,046,225 2,312,463
Vanguard Group 57 sales of shares of Vanguard U.S. Growth Portfolio N/A 2,216,922 1,881,112
Vanguard Group 57 sales of shares of Vanguard Wellington Fund N/A 1,003,868 873,768
Vanguard Group 91 sales of shares of Comshare Stock Fund N/A 2,176,872 1,624,391
<CAPTION>
(h)
Current Value
of Asset on (i)
Transaction Date Net Gain
-------------------- --------------------
<S> <C> <C>
Vanguard Group $2,571,862 N/A
Vanguard Group 2,805,964 N/A
Vanguard Group 1,987,833 N/A
Vanguard Group 845,236 N/A
Vanguard Group 2,275,493 N/A
Vanguard Group 2,915,987 --
Vanguard Group 3,046,225 $733,762
Vanguard Group 2,216,922 335,810
Vanguard Group 1,003,868 130,100
Vanguard Group 2,176,872 552,481
</TABLE>
<PAGE> 16
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the incorporation by
reference of our report on the June 30, 1997 financial statements of the Profit
Sharing Plan of Comshare, Incorporated dated September 19, 1997, included in
this Form 11-K into the Company's previously filed Form S-8 and S-3
registration statements (File No. 33-6730, File No. 33-9755-3, File No.
33-28437, File No. 33-27002, File No. 33-37564, File No. 33-85720, File No.
33-87706, File No. 33-87708, File No. 33-86908 and File No. 33-65109).
Arthur Andersen LLP
Detroit, Michigan
September 25, 1997.
