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EXECUTION COPY
FOURTH AMENDMENT, CONSENT AND WAIVER, dated as of December 23, 1999
(this "Fourth Amendment") to the Credit Agreement dated as of October 28, 1997
(as heretofore amended, supplemented or otherwise modified, the "Credit
Agreement"), among CARIBINER INTERNATIONAL, INC., a Delaware corporation (the
"Parent"), CARIBINER, INC., a New York corporation (the "Company"; together with
the Parent, the "Borrowers"), the several banks and other financial institutions
from time to time parties thereto (the "Lenders"), THE CHASE MANHATTAN BANK, as
Administrative Agent for the Lenders (in such capacity, the "Administrative
Agent") and XXXXXXX XXXXX CAPITAL CORPORATION, as Syndication Agent (in such
capacity, the "Syndication Agent"; collectively with the Administrative Agent,
the "Agents").
W I T N E S S E T H :
WHEREAS, the Borrowers, the Lenders and the Agents are parties to the
Credit Agreement, pursuant to which the Lenders have agreed to make, and have
made, certain loans and other extensions of credit to the Borrowers on the terms
and subject to the conditions thereof;
WHEREAS, pursuant to the Third Amendment to the Credit Agreement dated
as of July 30, 1999, the Lenders agreed to waivers of compliance with certain
financial covenants contained in the Credit Agreement (the "Existing Waivers")
to permit the Borrowers an opportunity to pursue the sale of all or parts of its
businesses;
WHEREAS, the Parent (a) proposes to sell the Capital Stock of its
Subsidiaries that operate the audio visual businesses of the Parent and its
Subsidiaries (the "AV Business") in a transaction (the "AV Sale"), and (b) has
requested that the Lenders (i) consent to such AV Sale under Sections 7.05, 7.06
and 7.13 of the Credit Agreement, (ii) amend certain provisions of the Credit
Agreement to facilitate and reflect the disposition of the AV Business and (iii)
extend the Existing Waivers; and
WHEREAS, the Lenders are willing to agree to the requested waivers,
consent and amendments, but only on the terms and subject to the conditions
contained herein.
NOW THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Borrowers, the Lenders and the Administrative Agent hereby agree as follows:
SECTION 1. DEFINITIONS.
Capitalized terms used herein and not otherwise defined shall have
their respective meanings set forth in the Credit Agreement.
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SECTION 2. AMENDMENTS.
2.1 Amendments to Section 1.01 of the Credit Agreement. (a) Section
1.01 of the Credit Agreement is hereby amended by (i) deleting in their entirety
the definitions of the terms "Applicable Margin", "Financial Consultant" and
"Pricing Grid" and (ii) adding the following new definitions in their proper
alphabetical order:
"`Applicable Margin": means with respect to (a) Eurodollar
Loans, 3.25% and (b) with respect to ABR Loans, 2.25%; provided, that
(i) if the Borrowers have not delivered to the Administrative Agent by
March 1, 2000 a fully executed definitive agreement to consummate the
AV Sale on or before June 1, 2000, each of the foregoing margins shall
be increased on March 1, 2000 by .75% and (ii) if on or before June 1,
2000 the AV Sale has not been consummated on terms that generate not
less than $320,000,000 of Net Cash Proceeds, each of the foregoing
margins (as theretofore adjusted pursuant to the foregoing clause (i)
of this proviso, if applicable) shall be increased on June 1, 2000 by
.75% until such time as the AV Sale has been consummated and the Term
Loans and the Revolving Credit Commitments have been prepaid and
reduced (as applicable) by an aggregate amount of not less than
$320,000,000.
"AV Sale": means the sale of the AV Business in accordance
with the consent of the Lenders granted under the Fourth Amendment to
the Credit Agreement dated as of December 23, 1999.
"AV Business": means the audio visual businesses of the Parent
and its Subsidiaries.
"Consultant": means a firm or individual specializing in
providing financial consulting and advisory services that is reasonably
satisfactory to the Borrowers and the Administrative Agent.
"Fourth Amendment Effective Date": December 23, 1999.".
(b) Section 1.01 of the Credit Agreement is hereby further amended by
deleting the date "September 30, 2003" from the definitions of "Revolving Credit
Termination Date" and "Term Loan Maturity Date" and inserting in lieu thereof
the date "October 1, 2001".
(c) The definition of "Consolidated Unadjusted EBITDA" set forth in
Section 1.01 of the Credit Agreement shall be amended by adding the following
sentence to the end of such definition:
For purposes of calculating Consolidated Unadjusted EBITDA for
any period in which there are expenditures by the Borrowers in
respect of the Consultant required by Section 6.15(a) of the Credit
Agreement, the amount of such expenditures during such periods shall
be added to Consolidated Net Income in determining Consolidated
Unadjusted EBITDA for such period.
2.2 Amendment to Section 2.04(b) of the Credit Agreement. Section
2.04(b) of the Credit Agreement is hereby amended by deleting the Installment
amounts and dates after
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June 30, 2001 and inserting in lieu thereof the following information under the
relevant columns:
"Installment Principal Amount
------------ ----------------
October 1, 2001 Remaining Outstanding Principal Amount".
2.3 Amendment to Section 2.06 (i) of the Credit Agreement. Section 2.06
of the Credit Agreement is hereby amended by adding the following proviso to the
end of paragraph (i) of said Section:
"provided that the Revolving Credit Commitments shall not be
permanently reduced by an amount (the "Retained Commitment") equal to
50% of the Net Cash Proceeds of the AV Sale in excess of $320,000,000
applied to the prepayment of the Term Loans and reduction of the
Revolving Credit Commitments (but up to a maximum Retained Commitment
of $10,000,000), which Retained Commitment shall be available for
reborrowing in accordance with, and subject to, the terms and
conditions contained in this Agreement.".
2.4. Amendment to Section 6.15 of the Credit Agreement. Section 6.15 of
the Credit Agreement is hereby amended by deleting said section in its entirety
and inserting in lieu thereof the following:
"SECTION 6.15. Consultant; Investment Banker; Management Reports. (a)
Not later than January 31, 2000, the Borrowers shall retain, and
thereafter continue the employment of, a Consultant on terms and with a
scope of retention reasonably satisfactory to the Borrowers and the
Administrative Agent.
(b) Unless the Required Lenders otherwise consent, the
Borrowers shall, following the Fourth Amendment Effective Date,
continue retention of its investment banker in connection with the
Asset Sale program as originally described to the Lenders at the July
8, 1999 Lender meeting, and as updated at the December 13, 1999 Lender
meeting, which investment banker shall (x) confirm that such Asset Sale
program remains active and ongoing at the time of the delivery of each
report referred to in Section 6.01(j) and (y) provide other information
in respect of the Asset Sale program as may reasonably be requested by
the Lenders, subject to the customary restrictions governing the
confidentiality of the sales process.
(c) Promptly following the delivery of the financial statements
referred to in Section 6.01(c), the Borrowers shall make their Chief
Financial Officer available to the Lenders on a mutually convenient
basis to provide a report on and to discuss such financial statements.
2.5. Amendments to Article VI of the Credit Agreement. Article VI of
the Credit Agreement is hereby amended by adding the following new Section 6.16
to said Article:
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SECTION 6.16. Litigation Settlement. Without the consent of the
Required Lenders (which consent shall not be unreasonably withheld or
delayed), the Parent will not settle or otherwise compromise its
alleged liability in respect of any shareholder litigation in a manner
requiring the payment of money (not paid by insurance carriers or other
third parties).
2.6. Amendments to Section 7.01 of the Credit Agreement. (a) Section
7.01 of the Credit Agreement is hereby amended by deleting paragraph (c) in its
entirety and inserting in lieu thereof the following new paragraph (c):
"(c) Consolidated Unadjusted EBITDA. Permit Consolidated Unadjusted
EBITDA for any period set forth below to be less than the amount set forth
opposite such period:
Period Amount
------ ------
10/01/99 - 12/31/99 $7,000,000
10/01/99 - 3/31/00 $35,000,000
10/01/99 - 6/30/00 $15,000,000
10/01/99 - 9/30/00 $23,000,000;
provided that for purposes of determining compliance with this covenant
(i) for any period prior to the AV Sale in which the results of the AV
Business would not be included in Consolidated Unadjusted EBITDA
(because the AV Business is classified as assets held for sale,
discontinued operations or similar classification) the results of the
AV Business shall be included in Consolidated Unadjusted EBITDA and
(ii) for any period following the consummation of the AV Sale,
Consolidated Unadjusted EBITDA shall be calculated without regard (at
any time during the applicable period) to operations and businesses
sold or discontinued prior to such date; and provided, further, that,
in the event that the AV Sale is not consummated (x) prior to June 30,
2000, then the Consolidated Unadjusted EBITDA for the period 10/01/99 -
6/30/00 shall not be permitted to be less than $57 million, or (y)
prior to September 30, 2000, then the Consolidated Unadjusted EBITDA
for the period 10/01/99 - 9/30/00 shall not be permitted to be less
than $75 million."
(b) Section 7.01 of the Credit Agreement is hereby further amended by
deleting paragraph (d) of said section thereof in its entirety and inserting in
lieu thereof the following new paragraph (d):
"(d) Capital Expenditures. Permit Capital Expenditures for any period
set forth below to exceed the amount set forth opposite such period:
Period Amount
------ ------
7/1/99 - 9/30/99 $10,000,000
10/1/99 - 3/31/00 $20,000,000
4/1/00 - 6/30/00 $1,500,000
7/1/00 - 9/30/00 $1,500,000;
provided, that (i) in the event that the AV Sale is not consummated (x)
prior to June 30, 2000, then the maximum capital expenditures for the
three month period ending on such date shall not exceed $10,000,000 or
(y) prior to
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September 30, 2000, then maximum capital expenditures for the three
month period ending on such date shall not exceed $10,000,000 and (ii)
Capital Expenditures made during the period of 7/01/99 through 9/30/99
in excess of the amount permitted by this Section 7.01(d) (such excess
to be in an amount not exceeding $3,500,000) shall be deemed to have
been made during the period from 10/01/99 through 3/31/00 and shall
reduce the amount otherwise permitted by this Section 7.01(d) for such
period on a dollar-for-dollar basis.
2.7. Amendments to Section 8 of the Credit Agreement. Section 8 of the
Credit Agreement is hereby amended by inserting "6.16," after the reference to
"6.15," in paragraph (c) of said Section.
2.8. Amendment to Annex A. Annex A to the Credit Agreement is hereby
deleted in its entirety.
SECTION 3. CONSENTS.
3.1 Consent Regarding Delivery of Financial Statements. The Lenders
hereby consent under Section 6.01(a) that the Borrowers shall have until the
business day following the filing of form 10-K of the Parent and its
Consolidated Subsidiaries with the Securities and Exchange Commission but in
event no later than 1/31/00 to deliver the financial statements of the Parent
and its Consolidated Subsidiaries for the fiscal year ending on September 30,
1999.
3.2 Consent to AV Sale. The Lenders hereby consent under Sections 7.05,
7.06 and 7.13 of the Credit Agreement to the AV Sale; provided that (a) such
consent shall automatically terminate and be of no force or effect on October 1,
2000, unless on or prior to such date the Borrowers (or their applicable
Subsidiaries) shall have consummated the AV Sale on terms that generate not less
than $320,000,000 of Net Cash Proceeds and (b) the Net Cash Proceeds of the AV
Sale are applied to the prepayment of the Term Loans and the reduction of the
Revolving Credit Commitments in accordance with Section 2.06(i) of the Credit
Agreement.
SECTION 4. WAIVERS.
4.1 Term Loan Payments. The Term Loan Lenders hereby waive any Event of
Default under Section 8(a) of the Credit Agreement resulting from the Borrowers'
failure to make the Term Loan principal payments due on December 31, 1999 and
March 31, 2000, provided that such waiver shall automatically terminate and be
of no force or effect (and such principal payments shall thereupon become
automatically due and payable) on the earlier of (x) the business day on which
the AV Sale is consummated or (y) October 1, 2000.
4.2 Continuation of Existing Waivers; Section 7.01(c). The Lenders
hereby waive until October 1, 2000, any Default or Event of Default under
Section 8(c) of the Credit Agreement resulting from (a) the Borrowers' failure
to maintain (i) the Consolidated Leverage Ratio required by Section 7.01(a) of
the Credit Agreement, (ii) the ratio of Consolidated EBITDA less Capital
Expenditures to Consolidated Cash Interest Expense required by Section 7.01(b)
of the Credit Agreement, in each case for the periods of four fiscal quarters
ending June
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30, 1999, September 30, 1999, December 31, 1999, March 31, 2000, June 30, 2000
and September 30, 2000, or (iii) the Consolidated Unadjusted EBITDA required by
Section 7.01(c) of the Credit Agreement for the period of four fiscal quarters
ending September 30, 1999 and (b) the violation of Section 7.01(d) of the Credit
Agreement for the period ending 9/30/99 as a result of making Capital
Expenditures during such period in an amount exceeding, by up to $3,500,000, the
amount of Capital Expenditures permitted by such Section 7.01(d) for such
period.
SECTION 5. MISCELLANEOUS.
5.1. Representations and Warranties; No Default. After giving effect to
this Fourth Amendment, the Borrowers hereby represent and warrant that all
representations and warranties contained in the Credit Agreement are true and
correct in all material respects as of the date hereof (unless stated to relate
to a specific earlier date, in which case, such representations and warranties
shall be true and correct in all material respects as of such earlier date) and
that no Default or Event of Default shall have occurred and be continuing or
would result from the execution and delivery of this Fourth Amendment.
5.2 Conditions to Effectiveness of this Fourth Amendment. This Fourth
Amendment shall be effective as of the date first set forth above upon the
satisfaction of the following conditions:
(a) receipt by the Administrative Agent of counterparts hereof duly
executed and delivered by the Borrowers, each Term Loan Lender and Majority
Lenders and consented to by the Loan Parties (other than the Borrowers);
(b) the payment by the Borrowers to the Administrative Agent, for the
ratable benefit of the Lenders, a fee equal to .125% of the aggregate Revolving
Credit Commitments and outstanding Term Loans of all of the Lenders; and
(c) the payment by the Borrowers of the costs and expenses of the
Administrative Agent owing under Section 10.05 of the Credit Agreement and for
which invoices have been submitted.
5.3 Limited Effect. Except as expressly amended by this Fourth
Amendment, the Credit Agreement is and shall continue to be in full force and
effect in accordance with its terms, and this Fourth Amendment shall not
constitute the Lenders' consent or indicate their willingness to consent to any
other amendment, modification or waiver of the Credit Agreement or the other
Loan Documents.
5.4 GOVERNING LAW. THIS FOURTH AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
5.5 Counterparts. This Fourth Amendment may be executed by the parties
hereto on one or more counterparts, and all of such counterparts shall be deemed
to constitute one and the same instrument. This Fourth Amendment may be
delivered by facsimile transmission of the relevant signature pages hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Fourth
Amendment to be executed and delivered by their respective duly authorized
officers as of the date first above written.
CARIBINER INTERNATIONAL, INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Title: Exec. VP and Chief Financial Officer
CARIBINER, INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Title: Exec. VP and Chief Financial Officer
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THE CHASE MANHATTAN BANK, individually
and as Administrative Agent
By:/s/ Xxxxx Xxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
XXXXXXX XXXXX CAPITAL CORPORATION,
individually and as Syndication Agent
By:/s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
BANKBOSTON, N.A.
By:/s/ Xxxxx Xxxxx
---------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
BANKERS TRUST COMPANY
By:/s/ Xxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Principal
BANK OF AMERICA, N.A.
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By:/s/ Xxxxx-Xxxx Xxxxxxxxx
-------------------------------
Name: Xxxxx-Xxxx Xxxxxxxxx
Title: Vice President
BANK OF HAWAII
By:/s/ Xxxxx X. Xxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
THE BANK OF NEW YORK
By:/s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
THE BANK OF NOVA SCOTIA
By:/s/ Xxxxx X. Xxxxx
-------------------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
BANK POLSKA KASA OPIEKI S.A.
PEKAO S.A. GROUP, NEW YORK BRANCH
By:/s/ Xxxxx X. Xxxxx
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Name: Xxxxx X. Xxxxx
Title: Vice President- Senior Lending Officer
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CREDIT AGRICOLE INDOSUEZ
By:/s/ Xxxxx XxXxxxxxxx
---------------------------------
Name: Xxxxx XxXxxxxxxx
Title: Vice President
By:/s/ Xxxxxxx Xxxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
FLEET BANK, N.A.
By:/s/ Xxxx X. Xxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Banking Officer
FIRST UNION NATIONAL BANK
By:/s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
FIR TREE INSTITUTIONAL VALUE FUND
By:/s/ Xxxx Xxxxxxxxxx
---------------------------------
Name: Xxxx Xxxxxxxxxx
Title:
FIR TREE VALUE PARTNERS, LLC
By:/s/ Xxxx Xxxxxxxxxx
---------------------------------
Name: Xxxx Xxxxxxxxxx
Title:
FIR TREE VALUE FUND
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By:/s/ Xxxx Xxxxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxxxx
Title:
PNC BANK, NATIONAL ASSOCIATION
By:/s/ Xxxxxx Xxxxxxx, Xx.
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Name: Xxxxxx Xxxxxxx, Xx.
Title: Executive Vice President
THE CHASE MANHATTAN BANK
By: CHASE SECURITIES, INC., as Agent
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Authorized Signatory
MORGENS WATERFALL HOLDING L.L.C.
By:/s/ Xxxxx XxXxxx
-------------------------------
Name: Xxxxx XxXxxx
Title: Authorized Agent
XXX XXXXXX PRIME RATE INCOME TRUST
By: Xxx Xxxxxx Investment Advisory Corp.
By:/s/ Xxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
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XXX XXXXXX SENIOR INCOME TRUST
By: Xxx Xxxxxx Investment Advisory Corp.
By:/s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Vice Prsident
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Each of the undersigned hereby consents to the foregoing Fourth
Amendment and hereby confirms, reaffirms and restates that its obligations under
or in respect of the Credit Agreement and the documents related thereto to which
it is a party are and shall remain in full force and effect after giving effect
to the foregoing Fourth Amendment.
CARIBINER INTELLECTUAL PROPERTY
MANAGEMENT, INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive VP and
Treasurer
CARIBINER AUDIO VISUAL SERVICES, INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive VP and
Tresurer
HRI, V.I., INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive VP and
Treasurer
VISUAL ACTION HOLDINGS, INC.
By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive VP and
Treasurer
CARIBINER SERVICES LIMITED
By:/s/ Xxxx X. Xxxxxxxx
----------------------------
Name: Xxxx X. Xxxxxxxx
Title: Director
CARIBINER EUROPE LIMITED
By:/s/ Xxxxx Xxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxx
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Title: Director
VISUAL ACTION HOLDINGS LIMITED
By:/s/ Xxxx X. Xxxxxxxx
----------------------------
Name: Xxxx X. Xxxxxxxx
Title: Director
