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EXHIBIT 10.11
[UNION BANK OF CALIFORNIA LOGO]
FIRST AMENDMENT
TO TRADE FINANCE AGREEMENT
THIS FIRST AMENDMENT TO TRADE FINANCE AGREEMENT (this "First Amendment") dated
as of March 22, 1999, is made and entered into by and between T.HQ
INTERNATIONAL, LTD., a corporation organized and existing under the laws of the
United Kingdom ("Borrower"), and UNION BANK OF CALIFORNIA, N.A., a national
banking association ("Bank").
RECITALS:
A. Borrower and Bank are parties to that certain Trade Finance Agreement dated
as of December 4, 1998 (the "Agreement"), pursuant to which Bank agreed to
extend credit to Borrower.
B. Borrower and Bank desire to amend the Agreement, but subject to the terms and
conditions of this First Amendment.
AGREEMENT:
In consideration of the above recitals and of the mutual covenants and
conditions contained herein, Borrower and Bank agree as follows:
1. DEFINED TERMS. Initially capitalized terms used herein which are not
otherwise defined shall have the meanings assigned thereto in the Agreement.
2. AMENDMENTS TO THE AGREEMENT.
(a) Section 4.6 (Consolidated Quick Ratio) of the Agreement is hereby
amended to read in full as follows:
"4.6 CONSOLIDATED QUICK RATIO. Borrower shall not permit the ratio of
(a) the sum of cash, Cash Equivalents and accounts receivable, in each case for
THQ and its subsidiaries (including Borrower), to (b) the consolidated current
liabilities of THQ and its subsidiaries (including Borrower) (including advances
to THQ made under the Clean Advance Line of the THQ Agreement and outstanding at
such time) to be less than 1.00:1.00 as at the end of any fiscal quarter. As
used herein, the term 'Cash Equivalents' shall mean (i) securities issued or
directly and fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and credit of
the United States of America is pledged in support thereof), (ii) Dollar
denominated time deposits and certificates of deposit of any commercial bank
having a long-term unsecured debt rating of at least A or the equivalent thereof
from Standard & Poor's Ratings Services, a division of XxXxxx-Xxxx, Inc.
("S&P"), (iii) commercial paper issued by any corporation organized under the
laws of any state of the United States of America having a rating of at least A-
or the equivalent thereof from S&P or at least P-1 or the equivalent thereof
from Xxxxx'x Investors Service, Inc. ("Moody's") and (iv) investments in money
market funds substantially all of which are comprised of securities of the types
described in clauses (I) through (iii) hereinabove."
(b) Section 4.8 (Consolidated Total Liabilities to Consolidated
Shareholders' Equity) of the Agreement is hereby amended to read in full as
follows:
"4.8 CONSOLIDATED TOTAL LIABILITIES TO CONSOLIDATED SHAREHOLDERS EQUITY.
Borrower shall cause THQ and its subsidiaries (including Borrower) to maintain a
ratio of Consolidated Total Liabilities to Consolidated Shareholders' Equity of
not greater than (a) 1.10:1.00 as at the end of fiscal year ended December 31,
1998 and (b) 1.00:1.00 as at the end of each fiscal quarter thereafter. As used
in this Agreement, 'Consolidated Total Liabilities' shall mean the consolidated
total liabilities of THQ and its subsidiaries (including Borrower), as
determined in accordance with generally accepted accounting principles, as shown
on the liability side of the consolidated balance sheet of THQ and its
subsidiaries (including Borrower)."
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3. EFFECTIVENESS OF THIS FIRST AMENDMENT. This First Amendment shall become
effective as of the date hereof when, and only when, Bank shall have received
all of the following, in form and substance satisfactory to Bank:
(a) A counterpart of this First Amendment, duly executed by Borrower;
and
(b) Such other documents, instruments or agreements as Bank may
reasonably deem necessary.
4. RATIFICATION. Except as specifically amended hereinabove, the Agreement shall
remain in full force and effect and is hereby ratified and confirmed.
5. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants as follows:
(a) Each of the representations and warranties contained in the
Agreement, as amended hereby, is hereby reaffirmed as of the date hereof, each
as if set forth herein;
(b) The execution, delivery and performance of this First Amendment and
any other instruments or documents in connection herewith are within Borrower's
corporate power, have been duly authorized, are legal, valid and binding
obligations of Borrower, and are not in conflict with the terms of any charter,
bylaw, or other organization papers of Borrower or with any law, indenture,
agreement or undertaking to which Borrower is a party or by which Borrower is
bound or affected; and
(c) No event has occurred and is continuing or would result from this
First Amendment which constitutes or would constitute an Event of Default under
the Agreement.
6. GOVERNING LAW. This First Amendment and all other instruments or documents in
connection herewith shall be governed by and construed according to the laws of
the State of California.
7. COUNTERPARTS. This First Amendment may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.
WITNESS the due execution hereof as of the date first above written.
T.HQ INTERNATIONAL, LTD.
By: /s/ XXXXX X. XXXXXXX
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Title: President and CEO
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By: /s/ XXXX X. XXXX
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Title: VP of Finance and
Administration and CFO
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UNION BANK OF CALIFORNIA, N.A.
By: /s/ XXX XXXXXX
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Xxx Xxxxxx
Title: Vice President
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