AMENDMENT NO. 1 TO SECURITIES PURCHASE AGREEMENT
THIS AMENDMENT NO. 1, dated as of December 19, 1996 (this "Amendment"),
is between LodgeNet Entertainment Corporation, a Delaware corporation (the
"Company") and Xxxx Xxxxxxx Mutual Life Insurance Company and Massachusetts
Mutual Life Insurance Company (the "Required Holders") as holders of 75% of
the outstanding principal amount of the Company's 11.50% Senior Subordinated
Notes due 2005 (the "Notes"). This Amendment is a first amendment to the
Securities Purchase Agreement dated as of August 9, 1995 between the Company,
Xxxx Xxxxxxx Mutual Life Insurance Company, Allstate Life Insurance Company,
CM Life Insurance Comapny and Connecticut Mutual Life Insurance Company,
pursuant to which the Notes were issued (the "Securities Agreement").
Capitalized terms used in this Amendment without definition have the meanings
given therefor in the Securities Agreement.
RECITAL
The Company has requested that Holders consent to certain amendments to
the Securities Agreement in connection with the issuance by the Company of
$150,000,000 in aggregate amount of its 10.25% Senior Notes due 2006 (the
"144A Notes") to be issued pursuant to an Indenture dated as of December 19,
1996 by the Company as Issuer and Marine Midland Bank as Trustee (the "144A
Indenture") and the amendment of its current Revolving Credit Facility. The
Required Holders have agreed to consent to such amendments subject to the
terms and conditions of this Amendment.
NOW THEREFORE, for good and valuable consideration, the sufficiency of
which is acknowledged by the parties, it is agreed:
1. REPRESENTATION AND WARRANTIES. The Company hereby represents and
warrants to each of the Holders:
1A. AUTHORITY. This Amendment has been duly authorized by all necessary
corporate action on the part of the Company and has been duly executed and
delivered by an authorized officer of the Company and constitutes the legal,
valid and binding obligation of the Company, enforceable against the Company
in accordance with its terms.
1B. NO CONFLICTS. Subject to the consents referenced in Section 1E of
this Amendment, the execution and delivery of the Amendment and fulfillment
of and compliance with the terms and provisions hereof, do not and will not
conflict with the provisions of, or constitute a default under, or result in
any violation of, or result in the creation of any Lien (other than Liens
securing the New Facility Agreement described in Paragraph 1G hereof) upon
any of the properties or assets of the Company or any Subsidiary pursuant to
its charter or by-laws or other organizational documents, any award of any
arbitrator or any agreement (including any agreement with stockholders or
other equity holders), instrument, order, judgment, decree, statute, law,
rule or regulation to which it is subject.
1C. DISCLOSURE. The Company has delivered to each Holder a copy of the
Offering Memorandum dated December 16, 1996 prepared by the Company in
connection with the offer and sale of the 144A Notes (the "144A Memorandum").
The 144A Memorandum fairly describes, in all material respects, the general
nature of the business and principal properties of the Company and the terms,
conditions and use of proceeds of the 144A Notes and the 144A Indenture. The
144A Memorandum does not contain any untrue statement of material fact or
omit to state a material fact necessary in order to make the statement
contained therein, in light of the circumstances under which they were made,
not misleading.
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1D. NO DEFAULTS. As of the date hereof, no Default or Event of Default
exists, and immediately after the issuance of the 144A Notes and the
application of the proceeds thereof and the effectiveness of this Amendment,
no Default or Event of Default shall exist or be reasonably anticipated to
result therefrom.
1E. CONSENTS. As of the date hereof, the only Debt of the Company
entitled to the benefits of paragraph 12 of the Securities Agreement are the
Senior Notes, the Senior Note Agreement and the Revolving Credit Facility.
Except for the consents of the "Majority Banks" (as such term is defined in
the Revolving Credit Facility) and the Required Holders, no authorization,
consent, approval, exemption or other action by or notice to or filing with
any Governmental Authority or any other Person is required in connection with
the amendments to the Securities Agreement contemplated by this Amendment.
1F. 144A NOTES. Attached hereto as Exhibit A is a true, complete and
correct copy of the 144A Indenture. Except for the 144A Indenture, the 144A
Notes to be issued in the form of Exhibit A to the 144A Indenture and the
144A Memorandum, there are no other agreements or understandings (whether
written or oral) between the Company or any Subsidiary and any other Person
relating to the Debt evidenced by the 144A Notes. The Notes will rank not
less than pari passu with the 144A Notes, in priority of payment and in right
of security and credit support, if any.
1G. REVOLVING CAPITAL FACILITY. The Company has provided the Holders
with true, complete and correct copies of the Amended and Restated Revolving
Credit Agreement dated as of December 19, 1996 by and among the Company, the
Banks named therein and National Westminster Bank Plc, as Agent and National
Westminster Bank of Canada, as Issuing Bank, and providing for secured
advances by such Banks (the "New Facility Agreement") which will be in
effect upon the issuance of the 144A Notes. Except for the New Facility
Agreement and the Exhibits attached thereto and the agreements or instruments
referred to therein, there will be, upon the issuance of the 144A Notes, no
other agreements or understandings (whether written or oral) between the
Company or any Subsidiary and any other Person relating to the Revolving
Credit Facility.
2. AMENDMENTS. The Securities Agreement is hereby amended as follows:
0X. XXXXXXXXX 0X, XXXXXXX. Paragraph 1B of the Securities Agreement is
deleted and the following is substituted therefor:
"1B. RANKING. The Notes shall rank pari passu with each other, will
constitute direct senior obligations of the Company and shall rank
not less than pari passu in priority of payment with all other
outstanding Debt of the Company past, present or future, except for
Debt which is preferred as a result of being secured (but only to
the extent such security is not prohibited by this Agreement and
then only to the extent of such security)."
2B. PARAGRAPHS 6 AND 7, AFFIRMATIVE AND NEGATIVE COVENANTS. Paragraphs
6E, 6F, 6G, 6H, 7A, 7B, 7C, 7D, 7E, 7F, 7G and 7I of the Securities Agreement
are deleted in their entirety and Sections 4.03, 4.04, 4.05, 4.06, 4.07, 4.08,
4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.18, 4.19, 5.01 and 5.02 of the 144A
Indenture are substituted therfor as if such Sections were set forth
in this Amendment in their entirety and all defined terms used in such
Sections shall have the meanings given therefor in the 144A Indenture as if
such definitions were set forth in this Amendment in their entirety, PROVIDED:
(i) the terms "Notes" in such Sections, shall, for the
purposes of the Securities Agreement, mean the Notes as defined in the
Securities Agreement;
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(ii) the term "Closing Date" as used in such Sections, shall,
for the purposes of the Securities Agreement, mean the date on which
the 144A Notes are originally issued under the 144A Indenture;
(iii) the term "Indenture" in such Sections shall, for the
purposes of the Securities Agreement, mean the Securities Agreement;
and
(iv) such Sections shall retain their section number
designations for the purpose of cross-references within, and to,
such Sections in the Securities Agreement and Sections 4.03 through
4.15 together with Sections 4.18 and 4.19 shall collectively
constitute "Article Four" of the Securities Agreement and Sections
5.01 and 5.02 shall constitute "Article Five" of the Securities
Agreement for such purpose.
2C. PARAGRAPH 8, EVENTS OF DEFAULT.
(i) Subparagraph (d) of paragraph 8A of the Securities
Agreement is deleted and the following is substituted therefor:
"(d) the Company fails to perform or observe any
covenant contained in any of Sections 4.03, 4.04, 4.05, 4.07,
4.08, 4.11 or 5.01, as such Sections have been incorporated by
reference into this Agreement from that certain Indenture
dated as of December 19, 1996 between the Company, as Issuer
and Marine Midland Bank, as Trustee and relating to the
issuance of the Company's 10.25% Senior Notes due 2006."
(ii) Subparagraph (f) of paragraph 8A of the Securities
Agreement is amended to insert the phrase "or to permit the holder
or holders of such Debt (or a trustee on behalf of such holder or
holders) to cause," after the word "cause" in clause (ii) of such
subparagraph (f).
2D. PARAGRAPH 11B, OTHER TERMS.
(i) The definition set forth in paragraph 11B of the
Securities Agreement for the term "Revolving Credit Agreement" is
deleted and the following is substituted therefor:
"Revolving Credit Agreement" shall mean the Amended and
Restated Loan Agreement dated as of December 19, 1996 by and among
the Company, the Banks named therein and the National Westminster
Bank, Plc, as Agent, and National Westminster Bank of Canada, as
Issuing Bank, as amended, amended and restated, modified or
supplemented from time to time.
(ii) The proviso in clause (ii) of the definition of
Revolving Credit Facility set forth in paragraph 11B of the
Securities Agreement is deleted and the following is substituted
therefor:
"PROVIDED that the provisions of any credit agreement
referred to in this clause (ii) do not restrict the Company's
ability to amend this Agreement or the Notes".
(iii) The defined terms "Default Notice", "Senior Covenant
Default", "Senior Obligations", "Senior Payment Default" and
"Permitted Post Petition Interest" set forth in paragraph 11B of
the Securities Agreement are deleted.
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2E. PARAGRAPH 12. SUBORDINATION OF THE NOTES. Paragraphs 12A
through 12N, inclusive, of the Securities Agreement are deleted.
2F. PARAGRAPH 13C. CONSENT TO AMENDMENTS. The last sentence of
paragraph 13C of the Securities Agreement is deleted.
3. EFFECTIVENESS. This Amendment shall become effective upon
satisfaction of the following conditions precedent:
(i) Each of the Holders shall have received an opinion from
Xxxx X. Xxxxxxxx, Vice President and General Counsel, of the
Company to the effect that (A) the Company is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and has all requisite corporate and other
power and authority to execute, deliver and perform this Amendment;
(B) this Amendment has been duly authorized by all necessary
corporate action on the part of the Company and has been duly
executed and delivered by an authorized officer of the Company and
constitutes the legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms,
except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting the rights of creditors generally, or by equitable
principals; (C) other than the consents which have been obtained,
no consent, approval, exemption or any action by or notice to or
filing with any Governmental Authority or any other Person is
required in connection with the execution and delivery of this
Amendment; (D) the execution, delivery and performance of this
Amendment do not, and will not, conflict with the provisions of or
constitute a default under or result in any violation of or result
in the creation of any Lien (other than Liens securing the New
Facility Agreement) upon any of the properties or assets of the
Company or any Subsidiary pursuant to its charter or by-laws or
other organizational document, any award of any arbitrator or
order, judgment, decree, statute, law, rule or regulation to which
it is subject or the Securities Agreement, the Revolving Credit
Agreement, the Senior Note Agreement, 144A Indenture or any other
material agreement to which the Company or any Subsidiary is a
party or to which it or its assets are subject and otherwise in
form and substance satisfactory to the Required Holders;
(ii) The 144A Notes shall have been duly issued and the 144A
Indenture shall be in full force and effect and the Required
Holders shall have received such evidence thereof as they shall
have reasonably requested, including, without limitation, delivery
to the Holders of counterparts, addressed to the Holders, of each
certificate or opinion delivered to the original purchasers of the
144A Notes;
(iii) The Loan Agreement dated as of March 17, 1995 by and
between the Company and NatWest Bank, N.A., as agent and as bank
shall have been terminated, and all amounts due thereunder shall
have been paid in full and the New Facility Agreement shall be in
full force and effect and the Required Holders shall have received
such evidence thereof as they shall have reasonably requested,
including, without limitation, delivery to each Holder of copies of
each opinion and certificate delivered in connection with the New
Facility Agreement; and
(iv) All consents required from any Governmental Authority or
any other Person to this Amendment shall have been obtained and the
Required Holders shall have received such evidence thereof as they
shall have reasonably requested.
4. NO OTHER AMENDMENTS. Except as expressly set forth herein, the
Securities Agreement shall continue in full force and effect without alteration
or amendment.
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5. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be an
original, but all of which shall together constitute one in the same
instrument.
6. GOVERNING LAW. THIS AMENDMENT IS DELIVERED IN THE COMMONWEALTH
OF MASSACHUSETTS IS TO BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS (WITHOUT GIVING EFFECT TO ANY LAWS OR RULES RELATING TO
CONFLICTS OF LAWS THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY
JURISDICTION OTHER THAN THE COMMONWEALTH OF MASSACHUSETTS).
EXECUTED under seal as of the date first written above.
LODGENET ENTERTAINMENT CORPORATION
By:/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President, Finance
XXXX XXXXXXX MUTUAL LIFE
INSURANCE COMPANY
By:/s/ Xxxxxxx XxXxxx
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Name: Xxxxxxx XxXxxx
Title:
MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
By:/s/ Xxxxxxxx X. St. Leman
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Name: Xxxxxxxx X. St. Xxxxx
Title:
