Exhibit 10.18
LIMITED WAIVER TO
CREDIT AGREEMENT
This Limited Waiver to Credit
Agreement (this “ Limited Waiver ”), dated as of
July 31, 2007, 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 ”) ,
WELLS 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 the definition of
Permitted Investments in Schedule 1.1 requiring that
Investments by Subsidiaries other than U.S. Subsidiaries be in
Securities Accounts, Deposit Accounts or other similar investments
outside the United States so long as the aggregate amount of such
Investments outside the United States does not constitute more than
(1) 75% of all Investments by Parent and its Subsidiaries from
the period commencing on the Closing Date and ending on
December 31, 2006 and (2) 50% of all Investments by
Parent and its Subsidiaries for any period on or after
January 1, 2007 (excluding from such percentage any
Investments held in China) and 35% of all Investments by Parent and
its Subsidiaries for any period on or after January 1, 2007
(including in such percentage any Investments held in China) so
long as the Borrower is in compliance with such requirements on and
after November 30, 2007.
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
Wai
