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EXHIBIT 10.18(c)
CONSENT, WAIVER AND THIRD AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
THIS CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT
AGREEMENT (the "Amendment"), dated as of July 31, 2000, is among SOFTWARE
SPECTRUM, INC., a corporation duly organized and validly existing under the laws
of the State of Texas (the "Borrower"), each of the banks or other lending
institutions which is a signatory hereto (individually, a "Bank" and,
collectively, the "Banks"), THE CHASE MANHATTAN BANK, individually as a Bank and
as administrative agent for itself and the other Banks (in its capacity as
administrative agent, together with its successors in such capacity
"Administrative Agent") and CHASE BANK OF TEXAS, NATIONAL ASSOCIATION (formerly
known as Texas Commerce Bank National Association), individually as a Bank and
as collateral agent for itself and the other Banks (in its capacity as
collateral agent, together with its successors in such capacity, the "Collateral
Agent").
RECITALS:
The Borrower, the Banks, the Administrative Agent and the Collateral
Agent have entered into that certain Amended and Restated Credit Agreement dated
as of March 11, 1998 (as amended by that certain First Amendment to Amended and
Restated Credit Agreement dated as of August 15, 1998, and that certain Second
Amendment to Amended and Restated Credit Agreement dated as of June 23, 1999,
the "Agreement").
The Borrower has informed the Administrative Agent and the Banks that
it intends to sell in two or more unrelated transactions (i) the assets of its
Customer Relationship Management Business, which is operated through Borrower's
wholly owned subsidiary, Software Spectrum CRM, Inc., and which had a book value
of approximately $3,000,000 as of April 30, 2000; and (ii) substantially all of
the assets relating to its "Professional Services" business, a division of
Spectrum Integrated Services, Inc. (the "Business"), which assets had a book
value as of April 30, 2000, of approximately $12,037,000 and which business
operated out of 16 locations prior to the discontinuation of operations at 10
locations as of May 31, 2000 (the transactions referred to in clauses (i) and
(ii) above being collectively referred to herein as the "Asset Sales"). The
Borrower has requested that the Administrative Agent, the Collateral Agent and
the Banks consent to the Borrower's departure from the covenant contained in
Section 9.8 of the Agreement (the "Applicable Covenant") which restricts the
Borrower's ability to sell its assets.
In accordance with the terms and conditions of this Amendment,
Administrative Agent, Collateral Agent and the Banks consent to Borrower's
departure from the Applicable Covenant in order to allow the Asset Sales to
occur.
Borrower has advised the Agent and the Banks that Events of Default
have occurred under subsection 11.1(c) of the Agreement as a result of the
Borrower's failure to comply with the covenants set forth in Section 10.4 of the
Agreement as of and for the Fiscal Quarter ending
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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April 30, 2000, and as of and for the two consecutive Fiscal Quarters ending
April 30, 2000 (collectively, the "Existing Defaults" and the covenants
described above, herein the "Violated Covenants"). Borrower has also advised the
Agent and the Banks that it projects an Event of Default to occur under
subsection 11.1(c) of the Agreement as a result of the Borrower's failure to
comply with the covenants set forth in Section 10.4 of the Agreement as of and
for the two consecutive Fiscal Quarters ending July 31, 2000 (the "Projected
Default").
The Borrower has requested that the Administrative Agent, Collateral
Agent and Banks waive the Existing Defaults and the Projected Default.
In accordance with the terms and conditions of this Amendment, each of
the Administrative Agent, Collateral Agent and the Banks waive the Existing
Defaults and the Projected Default.
The Borrower, the Banks, the Administrative Agent and the Collateral
Agent also desire to amend the Agreement as herein set forth.
NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
Definitions
Section 1.1 Definitions. Capitalized terms used in this Amendment, to
the extent not otherwise defined herein, shall have the same meanings as in the
Agreement, as amended hereby.
ARTICLE 2
Consent
Section 2.1 Consent. Administrative Agent, Collateral Agent and the
Banks hereby consent to Borrower's departure from the Applicable Covenant in
order to allow the Asset Sales to occur and agree that such departure will not
result in a Default under the Agreement.
Section 2.2 Limitation of Consent. The consent set forth in Section 2.1
shall not be deemed a consent to the departure from or waiver of (a) the
Applicable Covenant for any purpose other than to permit the Asset Sales or (b)
any other covenants or condition in any Loan Document or (c) any Event of
Default that otherwise may arise as a result of the Asset Sales. The failure to
comply with the Applicable Covenant for any other sale of assets shall
constitute an Event of Default. Any computation of asset sales in order to
determine the Borrower's compliance with clause (e) in Section 9.8 of the
Agreement shall not include the assets sold in the Asset Sales.
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ARTICLE 3
Waiver
Section 3.1 Waiver. Administrative Agent, Collateral Agent and the
Banks hereby waive the Existing Defaults and the Projected Default and agree not
to exercise any rights or remedies available as a result of the occurrence
thereof.
Section 3.2 Limitation of Waiver. The waiver specifically described in
Section 3.1 shall not constitute and shall not be deemed a waiver of any other
Default, whether arising as a result of the further violation the Violated
Covenants or otherwise, or a waiver of any rights or remedies arising as a
result of such other Defaults. The failure to comply with the Violated Covenants
for any date, or any period ending on any date, for reasons other than those
described in the definitions of "Existing Defaults" and "Projected Default"
shall constitute an Event of Default.
ARTICLE 4
Amendments
Section 4.1 Amendment to Section 10.1. Effective as of April 30, 2000,
Section 10.1 of the Agreement is amended in its entirety to read as follows:
Section 10.1 Consolidated Net Worth. The Borrower will at all
times maintain the sum of (a) all amounts which, in conformity with
GAAP, would be included as stockholders' equity on a consolidated
balance sheet of the Borrower ad the Subsidiaries; minus (b) the amount
at which shares of capital stock of the Borrower is contained among the
assets on the balance sheet of the Borrower and the Subsidiaries; minus
(c) the aggregate amount of net income (or plus net loss, as
applicable) accruing from May 1, 1999, through October 31, 2000,
attributable to operations of the Business (including any gain or loss
incurred as a result of the Asset Sales, such terms "Business" and
"Asset Sales" each as defined in the Consent, Waiver and Third
Amendment to Amended and Restated Credit Agreement dated July 31, 2000,
among the parties to this Agreement [the "Third Amendment"]), to be an
amount not less than Seventy-Four Million Dollars ($74,000,000).
Section 4.2 Amendment to Section 10.2. Effective as of April 30, 2000,
the definition of "EBITDA" in Section 10.2 of the Agreement is amended and
restated to read as follows:
"EBITDA" means, for any period and any Person, the total of
the following each calculated without duplication on a consolidated
basis for such
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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period: (a) Net Income; plus (b) any provision for (or less any benefit
from) income or franchise taxes included in determining Net Income;
plus (c) Interest Expense deducted in determining Net Income; plus (d)
amortization and depreciation expense deducted in determining Net
Income; and, for the purpose of calculating compliance with the
covenant in Section 10.2 in any calculation of EBITDA that includes the
Borrower's consolidated performance for the Fiscal Quarter ended April
30, 2000, minus (e) the aggregate amount of all income (or plus the
aggregate amount of all expenses, as applicable) included in the
calculations of the amounts in clauses (a) through (d) above accruing
for such Fiscal Quarter and attributable to operations of the Business
(including any income or expense accrued as a result of the Asset
Sales, such terms "Business" and "Asset Sales" each as defined in the
Third Amendment).
Section 4.3 Amendment to Exhibit "D". Effective as of April 30, 2000,
"Exhibit D" to the Agreement is amended and restated in its entirety as set
forth on Exhibit "D" to this Amendment.
ARTICLE 5
Section 5.1 Conditions. The effectiveness of this Amendment is subject
to the satisfaction of the following conditions precedent:
(a) Administrative Agent shall have received all of the
following, each dated (unless otherwise indicated) the date of this
Amendment, in form and substance satisfactory to the Administrative
Agent.
(i) Resolutions. Resolutions of the Board of
Directors (or other similar authorizing documents) of the
Borrower certified by its Secretary, an Assistant Secretary,
or another authorized Person that authorize its execution,
delivery, and performance of this Amendment and the Loan
Documents to which it is or is to be a party hereunder.
(ii) Amendment Fee. The fees payable under that
certain letter from Administrative Agent to the Borrower dated
July 31, 2000.
(iii) Additional Information. Administrative Agent
shall have received such additional documentation and
information as Administrative Agent may request; and
(b) After giving effect to this Amendment, the representations
and warranties contained herein and in all other Loan Documents, as
amended hereby, shall be true and correct in all material respects as
of the date hereof as if made on the date hereof, except for such
representations and warranties limited by their terms to a specific
date;
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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(c) After giving effect to this Amendment, no Default shall
have occurred and be continuing; and
(d) All proceedings taken in connection with this Amendment
and all documentation and other legal matters incident thereto shall be
satisfactory to Administrative Agent.
ARTICLE 6
Miscellaneous
Section 6.1 Release of Collateral. Each of the Banks hereby consents to
Collateral Agent's executing, on behalf of each Bank, such agreements,
certificates and other documents necessary to release (or evidence or give
notice of the release of) the Collateral Agent's Liens on any Collateral sold as
part of the Asset Sales.
Section 6.2 Ratifications. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Agreement and except as expressly modified and superseded by this
Amendment, the terms and provisions of the Agreement and the other Loan
Documents are ratified and confirmed and shall continue in full force and
effect. Borrower, the Banks and the Agents agree that the Agreement as amended
hereby and the other Loan Documents shall continue to be legal, valid, binding
and enforceable in accordance with their respective terms.
Section 6.3 Representations and Warranties. Borrower hereby represents
and warrants to Administrative Agent and the Banks as follows: (a) after giving
effect to this Amendment, no Default has occurred and is continuing; (b) after
giving effect to this Amendment, the representations and warranties set forth in
the Loan Documents are true and correct in all material respects on and as of
the date hereof with the same effect as though made on and as of such date
except with respect to any representations and warranties limited by their terms
to a specific date; (c) the execution, delivery and performance of this
Amendment has been duly authorized by all necessary action on the part of
Borrower and each Obligated Party and does not and will not: (1) violate any
provision of law applicable to Borrower or any Obligated Party, the certificate
of incorporation, bylaws, partnership agreement, membership agreement, or other
applicable governing document of Borrower or any Obligated Party or any order,
judgment, or decree of any court or agency of government binding upon Borrower
or any Obligated Party; (2) 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 Borrower or any Obligated Party; (3) result in or
require the creation or imposition of any material lien upon any of the assets
of Borrower or any Obligated Party; or (4) require any approval or consent of
any Person under any material contractual obligation of Borrower or any
Obligated Party; and (d) except as previously disclosed to Administrative Agent,
the articles of incorporation, bylaws, partnership agreement, certificate of
limited partnership, membership agreement, articles of organization or other
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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applicable governing document of the Borrower and each Obligated Party,
resolutions of the Borrower attached as Exhibit B to its Secretary's Certificate
dated as of March 6, 1998, and resolutions of Spectrum Integrated Services, Inc.
attached as Exhibit B to its Secretary's Certificate dated as of March 6, 1998,
have not been modified or rescinded since March 6, 1998, and remain in full
force and effect, and the officers identified in each such Secretary's
Certificate continue to hold the offices set forth in such certificate.
IN ADDITION, TO INDUCE THE ADMINISTRATIVE AGENT AND THE BANKS TO AGREE
TO THE TERMS OF THIS AMENDMENT, BORROWER AND EACH OBLIGATED PARTY (BY ITS
EXECUTION BELOW) REPRESENT AND WARRANT THAT AS OF THE DATE OF ITS EXECUTION OF
THIS AMENDMENT THERE ARE NO CLAIMS OR OFFSETS AGAINST OR DEFENSES OR
COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS AND IN ACCORDANCE
THEREWITH IT WAIVES ANY AND ALL SUCH CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS,
WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF ITS EXECUTION OF THIS
AMENDMENT.
Section 6.4 Reference to Agreement. Each of the Loan Documents,
including the Agreement and any and all other agreements, documents, or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Agreement as amended hereby, are hereby amended
so that any reference in such Loan Documents to the Agreement shall mean a
reference to the Agreement as amended hereby.
Section 6.5 Expenses of Agents. As provided in the Agreement, Borrower
agrees to pay on demand all costs and expenses incurred by Administrative Agent
or Collateral Agent in connection with the preparation, negotiation, and
execution of this Amendment and the other Loan Documents executed pursuant
hereto, including without limitation, the costs and fees of Administrative
Agent's legal counsel.
Section 6.6 Severability. Any provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
Section 6.7 Applicable Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas and the applicable
laws of the United States of America.
Section 6.8 Successors and Assigns. This Amendment is binding upon and
shall inure to the benefit of the Banks, the Agents and Borrower and their
respective successors and assigns, except Borrower may not assign or transfer
any of its rights or obligations hereunder without the prior written consent of
the Banks.
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Section 6.9 Counterparts. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
agreement.
Section 6.10 Headings. The headings, captions, and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section 6.11 ENTIRE AGREEMENT. THIS AMENDMENT EMBODIES THE FINAL,
ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR
COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR
ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT BE CONTRADICTED OR VARIED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS
OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO.
Executed as of the date first written above.
BORROWER:
SOFTWARE SPECTRUM, INC.
By: /s/ Keith R. Coogan
------------------------------------
Keith R. Coogan
President & Chief Operating Officer
ADMINISTRATIVE AGENT:
THE CHASE MANHATTAN BANK, individually
as a Bank and as the Administrative Agent
By: /s/ Jim L. Holloway
------------------------------------
Jim L. Holloway
Senior Vice President
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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COLLATERAL AGENT:
CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION
(formerly known as Texas
Commerce Bank National
Association), individually
as a Bank and as the
Collateral Agent
By: /s/ Chris D. Capriotti
------------------------------------
Name: Chris D. Capriotti
Title VP
OTHER BANKS:
NATIONAL CITY BANK, KENTUCKY
By: /s/ Kevin L. Anderson
------------------------------------
Name: Kevin L. Anderson
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
By: /s/ James M. Steffig
------------------------------------
Name: James M. Steffig
Title: Vice President
FOOTHILL CAPITAL CORPORATION
By: /s/ Michael P. Baranowski
------------------------------------
Name: Michael P. Baranowski
Title: Vice President
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ACKNOWLEDGMENT
The undersigned hereby consents and agrees to this Amendment, and
hereby ratifies and confirms each of the Loan Documents to which it is a party
and agrees that such Loan Documents continue to be legal, valid, binding and
enforceable in accordance with their respective terms.
Witness due execution hereof by the undersigned as of the date first
written above.
SPECTRUM INTEGRATED SERVICES, INC.
By: /s/ Keith R. Coogan
----------------------------------
Keith R. Coogan, President,
Executive Vice President and
Assistant Secretary
CONSENT, WAIVER AND THIRD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
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EXHIBIT "D"
to
SOFTWARE SPECTRUM, INC.
CONSENT, WAIVER AND THIRD AMENDMENT TO
AMENDED AND RESTATED CREDIT AGREEMENT
Compliance Certificate
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COMPLIANCE CERTIFICATE
for the
quarter ending ________ __, ____
To: The Chase Manhattan Bank,
as administrative agent
600 Fifth Avenue, 4th Floor
New York, New York 10020
and each Bank
Ladies and Gentlemen:
This Compliance Certificate (the "Certificate") is being delivered
pursuant to Section 8.1(c) of that certain Amended and Restated Credit Agreement
(as amended, the "Agreement") dated as of March 11, 1998 among SOFTWARE
SPECTRUM, INC. (the "Borrower"), THE CHASE MANHATTAN BANK, as administrative
agent, CHASE BANK OF TEXAS, NATIONAL ASSOCIATION, as collateral agent and the
Banks named therein. All capitalized terms, unless otherwise defined herein,
shall have the same meanings as in the Agreement. All the calculations set forth
below shall be made pursuant to the terms of the Agreement.
The undersigned, an authorized financial officer of the Borrower, does
hereby certify to the Agent and the Banks that:
1. DEFAULT.
No Default has occurred and is continuing or if a Default has occurred
and is continuing, I have described on the attached Exhibit "A" the
nature thereof and the steps taken or proposed to remedy such Default.
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Compliance
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2. SECTION 8.1 - FINANCIAL STATEMENTS AND RECORDS
(a) Annual audited financial statements of Borrower on or before Yes No N/A
91 days after the end of each Fiscal Year.
(b) Quarterly unaudited financial statements of Borrower on a Yes No N/A
consolidated and consolidating basis within 46 days of each
Fiscal Quarter end.
(c) Borrowing Base Report together with the Receivables Reports Yes No N/A
within 20 days of each month end or within 20 days of any other
date required by the Administrative Agent.
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(d) If Daily Collection Event occurs, Receivable Reports Yes No N/A
(i) weekly or
(ii) daily
(e) Projections within 30 days before the start of each Fiscal Yes No N/A
Year.
3. SECTION 8.10 - COLLATERAL MATTERS
(a) Aggregate book value of inventory held by third $__________
parties $ 2,500,000
(b) Limit Yes No
(c) Collateral perfection/protection required Yes No
(d) Material Subsidiary created or acquired? Yes No
(e) If line (d) is yes, have 8.10(b) and (c) collateral measures
been taken?
4. SECTION 9.1 - DEBT
No Additional Debt except:
(a) Purchase money not to exceed: $ 5,000,000
Actual Outstanding: $__________ Yes No
(b) Guaranties of surety and other bonds not to $ 4,000,000
exceed: $__________ Yes No
Actual Outstanding:
(c) Outstanding Guaranties of permitted Debt of $__________ Yes No
Foreign Subs and Foreign Ventures
(d) Outstanding Loans, advances, other extensions of
credit, investments and contributions to Foreign
Subs (excluding Software Spectrum Canada in an
amount up to the gross Dollar amount of $__________ Yes No
receivables of Software Spectrum Canada) and $__________
Foreign Ventures Yes No
(e) Total Foreign Subsidiary Obligations (line 4(c)
plus 4(d)) $__________
(f) Foreign Subsidiary Limit Yes No
(i) $30,000,000 plus $10,000,000
(ii) if 9.1(e)(ii) test satisfied $10,000,000 $__________ Yes No
(g) Acquisition Debt incurred in any Fiscal Year not
to exceed $20,000,000
Actual incurred in current Fiscal Year $__________ Yes No
(note: Incurrence Test must also be met)
(h) Unsecured Vendor Debt not to exceed $ 5,000,000
Actual Outstanding $__________ Yes No
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(note: Incurrence Test must also be met)
(i) Unsecured Short Term Bank Debt not to exceed
Actual Outstanding
5. SECTION 9.3 - MERGERS, ETC.
(a) Has acquisition been consummated since last Compliance Yes No
Certificate?
(b) If line (a) yes, Purchase Price $__________
(c) Aggregate Purchase Prices from prior acquisitions
under 9.3 in current Fiscal Year $__________
(d) Purchase Price Limit per transaction $ 5,000,000 Yes No N/A
(e) Aggregate Purchase Price Limit per Fiscal Year $10,000,000 Yes No N/A
(f) Were the conditions in clauses (a) through (e) of
Section 9.3(iv) satisfied with respect to each Yes No N/A
acquisition ?
6. SECTION 9.4 - DIVIDENDS
(a) Stock repurchases pursuant to stock repurchase
program in existence at closing date not to exceed
(note: no further stock repurchases permitted
under this clause (a) after 1/31/99) $ 1,750,000
Actual such repurchases since Closing Date: $__________ Yes No N/A
(b) Stock repurchases pursuant to 7/98 stock
repurchase program not to exceed (note: no
further stock repurchases permitted under this
clause (b) after _______________)
Actual such repurchases since 8/31/98 (excluding $__________ Yes No
those included in clause (a)) $__________
(c) Stock repurchases for applicable period not to $__________ Yes No
exceed:
Actual repurchases during the applicable period:
(d) Attach as schedule evidence of compliance with
Section 9.4(iii) with respect to dividends and other
stock repurchases Yes No N/A
7. SECTION 9.8 - DISPOSITION ASSETS
(a) Book Value of asset disposed of in sale leaseback
transaction within the last 12 months $__________
Actual not to exceed: $ 500,000 Yes No N/A
(b) Book value of assets disposed of within the last 12 $__________
months $ 500,000 Yes No N/A
Actual not to exceed:
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8. SECTION 9.10 - PREPAYMENT OF DEBT
No prepayment of Debt except:
(a) Obligations
(b) Foreign Sub Debt Guaranteed
(c) Prepayment of other Debt limited in any Fiscal Year to: $ 500,000
(d) Aggregate amount of other Debt so prepaid in
current Fiscal Year $___________ Yes No N/A
9. SECTION 10.1 - CONSOLIDATED NET WORTH
(a) Required Consolidated Net Worth $ 74,000,000
(b) Actual Consolidated Net Worth
(i) shareholders equity $___________
(ii) minus treasury stock $___________
(iii) minus the gains (or plus losses, as applicable)
accruing between May 1, 1999, and October
31, 2000, attributable to operations of the
Business (including any gain or loss on the
Asset Sales) $___________
(iv) Actual Consolidated Net Worth $___________ Yes No N/A
10. SECTION 10.2 - INTEREST COVERAGE
(a) Net Income for applicable period $___________
(b) Plus net provisions for tax $___________
(c) Plus Interest Expense $___________
(d) Plus amortization and depreciation $___________
(e) Minus, if applicable, gains (or plus losses) from
Business or Assets Sales during Fiscal Quarter
ended 4-30-00 $___________
(f) Borrower EBITDA: 10(a) plus 10(b), 10(c) and
10(d), minus (or plus) 10(e) $___________
(g) Unfinanced Capital Expenditures $___________ Yes No
(h) (line 10(f) minus line 10(g)) $___________
(i) Interest Expense $___________
(j) Interest Coverage (line 10(h) divided by line 10(i) ___:1.00
(k) Minimum Interest Coverage ___:1.00
11. SECTION 10.3 - CAPITAL EXPENDITURE LIMITS
(a) Capital Expenditure limit for the period $___________
(b) Actual Capital Expenditures $___________ Yes No
12. SECTION 10.4 - NET INCOME
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EXHIBIT "D" - Compliance Certificate - Page 4
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(a) Net Income (most recent Fiscal Quarter) $___________
(b) less than -$2,500,000? Yes No
(c) Net Income (previous Fiscal Quarter) $___________
(d) 12(a) plus 12(c) less than $3,000,000? Yes No
13. DETERMINATION OF MARGIN AND FEES
(a) Borrower EBITDA: From 10(f) $___________
(b) All Capital Expenditures (financed and
unfinanced) $___________
(c) Actual technical support contract Capital
Expenditures not to exceed $1,500,000 incurred in
the period through the Fiscal Quarter ending
January 31, 1999 $___________
(d) (line 13(a) minus the positive sum of (i) line 13(b)
minus (ii), if calculated for a period $___________
prior to February 1, 1999, line 13(c)) ___:1.00
(e) Interest Expense Yes No
(f) Interest Coverage Ratio (line 13(d) divided by line
13(e))
(g) Adjustment to margin and fees required by _______%
Section 3.2? _______%
(h) If adjustment required, set forth below new _______%
margins and fees in accordance with Section 3.2:
(i) Base Margin
(ii) Libor Rate Margin and LC Fee
(iii) Commitment Fee
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14. ATTACHED SCHEDULES
Attached hereto as schedules are the calculations supporting the
computation set forth above in this Certificate. All information
contained herein and on the attached schedules is true and correct.
15. FINANCIAL STATEMENTS
The unaudited financial statements attached hereto were prepared in
accordance with GAAP but presented in accordance with the interim
reporting rules and regulations of the Securities and Exchange
Commission and fairly present (subject to year end audit adjustments)
the financial conditions and the results of the operations of the
Persons reflected thereon, at the date and for the periods indicated
therein.
IN WITNESS WHEREOF, the undersigned has executed this Certificate
effective this _______ day of ____________, _______.
EXHIBIT "D" - Compliance Certificate - Page 5
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SOFTWARE SPECTRUM, INC.
By:
----------------------------
Name:
---------------------------
Title:
--------------------------
EXHIBIT "D" - Compliance Certificate - Page 6
