EXECUTION COUNTERPART
AMENDMENT NO. 1 TO
CREDIT AGREEMENT
THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "AMENDMENT") dated as of
April 21, 1998, by and among VARI-LITE INTERNATIONAL, INC., a Delaware
corporation (the "BORROWER"), SUNTRUST BANK, ATLANTA ("SUNTRUST"), XXXXX
BROTHERS XXXXXXXX & CO., CHASE BANK OF TEXAS, N.A., FORMERLY KNOWN AS TEXAS
COMMERCE BANK NATIONAL ASSOCIATION, COMERICA BANK-TEXAS and THE FIRST NATIONAL
BANK OF CHICAGO (collectively, the "LENDERS"), SUNTRUST BANK, ATLANTA, as agent
and collateral agent for the Lenders (in such capacity, the "AGENT" and
"COLLATERAL AGENT"), and XXXXX BROTHERS XXXXXXXX & CO, AS CO-AGENT FOR THE
LENDERS (IN SUCH CAPACITY THE "CO-AGENT")
WITNESSETH:
WHEREAS, Borrower, the Lenders, the Agent and the Collateral Agent and the
Co-Agent are parties to a certain Multicurrency Credit Agreement dated as of
December 19, 1997 (as heretofore amended or modified, the "CREDIT AGREEMENT";
defined terms used herein without definition shall have the meanings ascribed to
such terms in the Credit Agreement);
WHEREAS, Borrower has requested, and the Lenders have agreed, that the
Credit Agreement be amended to make certain modifications to the covenants set
forth therein, all as more specifically set forth below;
WHEREAS, the parties wish to amend the Credit Agreement to reflect this
agreement;
NOW, THEREFORE, for and in consideration of the mutual covenants contained
herein and other valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto, intending to be legally bound,
agree as follows:
SECTION 1. AMENDMENTS TO CREDIT AGREEMENT. Subject to the satisfaction of
the conditions precedent set forth in SECTION 2 hereof, and effective as of the
Effective Date (as hereinafter defined), the Credit Agreement is hereby amended
as follows:
1. Section 1.01 of the Credit Agreement is hereby amended by adding the
following new defined terms in alphabetical order, as follows:
"INTERCREDITOR AGREEMENT" shall mean that certain Intercreditor
Agreement to be entered into between the Agent and the Collateral Agent
with the holders of the indebtedness outstanding pursuant to the Note
Agreement relating to the sharing of proceeds of the
Collateral and the collections under any guarantees, such agreement to be
in form and substance satisfactory to the Agent, the Collateral Agent and
each of the Lenders.
"NOTE AGREEMENT" shall mean the note purchase agreement to be entered
into by and among the Borrower and certain institutional investors
purchasing fixed rate notes of the Borrower, such agreement to be in form
and substance satisfactory to the Agent and each of the Lenders.
2. Section 6.08 of the Credit Agreement is hereby amended by deleting
subsections (a) and (c) thereof in its entirety and substituting the following
in lieu thereof:
"(a) LEVERAGE RATIO. Maintain as of the last day of each fiscal
quarter of Borrower, a maximum Leverage Ratio of no greater than sixty
percent (60%).
(c) FIXED CHARGE COVERAGE. Maintain as of the last day of each fiscal
quarter of Borrower during the Applicable Periods set forth below, a
minimum Fixed Charge Coverage Ratio of no less than the ratio set forth
such Applicable Period:
Applicable Period Ratio
----------------- -----
Closing Date through
December 31, 1998 1.50:1.00
January 1, 1999 through
September 30,1999 1.75:1.00
October 1, 1999 and thereafter 2.00:1.00."
3. Section 7.01 of the Credit Agreement is hereby amended by deleting
the "and" at the end of subsection (j) thereof and by deleting subsection (k)
thereof in its entirety and substituting the following in lieu thereof:
"(k) Indebtedness of the Borrower outstanding pursuant to the Note
Agreement in an aggregate principal amount not to exceed $30,000,000;
PROVIDED THAT such Indebtedness is (i) not secured other than by Liens on
the Collateral which are pari passu with the Liens on the Collateral in
favor of the Collateral Agent for the benefit of the Lenders and subject to
the Intercreditor Agreement, and (ii) incurred by the Borrower prior to
December 31, 1998;
(l) Indebtedness of the Guarantors outstanding pursuant to guarantees
of the Indebtedness permitted by subsection (k) above; PROVIDED THAT, the
holders of such guarantees entitled to the proceeds thereof are parties to
the Intercreditor Agreement; and
(m) other Indebtedness not to exceed $1,000,000 at any one time
outstanding."
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4. Section 7.02 of the Credit Agreement is hereby further amended by
deleting subsection (k) thereof in its entirety and substituting the following
in lieu thereof:
"(k) (x) Liens in favor of the Collateral Agent securing the
Obligations hereunder and (y) Liens on the Collateral securing the
Indebtedness outstanding pursuant to the Note Agreement; provided, that the
holder of such Liens securing the Indebtedness outstanding pursuant to the
Note Agreement has entered into the Intercreditor Agreement;"
5. Sections 7.09 and 7.10 of the Credit Agreement are each hereby further
amended by adding the following phrase at the end of such section: "or
restrictions arising pursuant to the Note Agreement".
6. The Credit Agreement is hereby amended by the addition of the
following Section 7.13:
"Section 7.13. ACTIONS UNDER NOTE PURCHASE AGREEMENT. Without the
prior written consent of the Agent and the Required Lenders, modify, amend
or supplement the Note Purchase Agreement to (i) increase the principal
amount of the indebtedness thereunder, (ii) increase the interest rate
thereunder, (iii) modify any requirement of prepayment or repayment
thereunder which would shorten the final maturity or average life of the
indebtedness outstanding thereunder or make the requirement of prepayment
more onerous, or (iv) make any more onerous any other provision thereof."
SECTION 2. CONDITIONS OF EFFECTIVENESS. This Amendment shall become
effective as of the date first above written (the "EFFECTIVE DATE") on the first
day when all of the foregoing shall have occurred:
1. This Amendment shall have been executed and delivered by Borrower and
the Lenders to the Agent; and
2. The Borrower shall have paid to the Agent, for the benefit of the
Lenders, an amendment fee equal to 7.5 basis points multiplied by the Master
Syndicated Loan Commitment of each Lender.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF BORROWER. Borrower, without
limiting the representations and warranties provided in the Credit Agreement,
represents and warrants to the Lenders and the Agents as follows:
1. The execution, delivery and performance by Borrower of this Amendment
are within Borrower's corporate powers, have been duly authorized by all
necessary corporate action (including any necessary shareholder action) and do
not and will not (a) violate any provision of any law, rule or regulation, any
judgment, order or ruling of any court or governmental agency, the articles of
incorporation or by-laws of Borrower or any indenture, agreement or other
instrument to
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which Borrower is a party or by which Borrower or any of its properties is
bound or (b)be in conflict with, result in a breach of, or constitute with
notice or lapse of time or both a default under any such indenture, agreement
or other instrument.
2. This Amendment constitutes the legal, valid and binding obligation of
Borrower, enforceable against Borrower in accordance with its terms.
3. No Default or Event of Default has occurred and is continuing as of
the Effective Date.
SECTION 4. SURVIVAL. Each of the foregoing representations and warranties
and each of the representations and warranties made in the Credit Agreement
shall be made at and as of the Effective Date. Each of the foregoing
representations and warranties shall constitute a representation and warranty of
Borrower under the Credit Agreement, and it shall be an Event of Default if any
such representation and warranty shall prove to have been incorrect or false in
any material respect at the time when made. Each of the representations and
warranties made under the Credit Agreement (including those made herein) shall
survive and not be waived by the execution and delivery of this Amendment or any
investigation by the Lenders or the Agent or the Collateral Agent.
SECTION 5. NO WAIVER. ETC. Borrower hereby agrees that nothing herein shall
constitute a waiver by the Lenders of any Default or Event of Default, whether
known or unknown, which may exist under the Credit Agreement. Borrower hereby
further agrees that no action, inaction or agreement by the Lenders, including
without limitation, any indulgence, waiver, consent or agreement altering the
provisions of the Credit Agreement which may have occurred with respect to the
non-payment of any obligation during the terms of the Credit Agreement or any
portion thereof, or any other matter relating to the Credit Agreement, shall
require or imply any future indulgence, waiver, or agreement by the Lenders. In
addition, Borrower acknowledges and agrees that it has no knowledge of any
defenses, counterclaims, offsets or objections in its favor against any Lender
with regard to any of the obligations due under the terms of the Credit
Agreement as of the date of this Amendment.
SECTION 6. AFFIRMATION OF COVENANTS. Borrower hereby affirms and restates
as of the date hereof all covenants set forth in the Credit Agreement, as
amended hereby, and such covenants are incorporated by reference herein as if
set forth herein directly.
SECTION 7. RATIFICATION OF CREDIT AGREEMENT. Except as expressly amended
herein, all terms, covenants and conditions of the Credit Agreement and the
other Loan Documents shall remain in full force and effect, and the parties
hereto do expressly ratify and confirm the Credit Agreement as amended herein.
All future references to the Credit Agreement shall be deemed to refer to the
Credit Agreement as amended hereby.
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SECTION 8. BINDING NATURE. This Amendment shall be binding upon and inure
to the benefit of the parties hereto, their respective heirs, successors,
successors-in-titles, and assigns.
SECTION 9. COSTS. EXPENSES AND TAXES. Borrower agrees to pay on demand all
reasonable costs and expenses of the Agent and the Collateral Agent in
connection with the preparation, execution and delivery of this Amendment and
the other instruments and documents to be delivered hereunder, including,
without limitation, the reasonable fees and out-of-pocket expenses of counsel
for the Agent and the Collateral Agent with respect thereto and with respect to
advising the Agent and the Collateral Agent as to its rights and
responsibilities hereunder and thereunder. In addition, Borrower shall pay any
and all stamp and other taxes payable or determined to be payable in connection
with the execution and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, and agrees to save the Agent, the
Collateral Agent, the Co-Agent and each Lender harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes.
SECTION 10. GOVERNING LAW. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of Georgia.
SECTION 11. ENTIRE UNDERSTANDING. This Amendment sets forth the entire
understanding of the parties with respect to the mailers set forth herein, and
shall supersede any prior negotiations or agreements, whether written or oral,
with respect thereto.
SECTION 12. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts and may be
delivered by telecopier. Each counterpart so executed and delivered shall be
deemed an original and all of which taken together shall constitute but one and
the same instrument.
[Signatures Set Forth on Next Page]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment through
their authorized officers as of the date first above written.
VARI-LITE INTERNATIONAL, INC.
By: /s/ Xxxx Xxxxxx
-------------------------------
Name: XXXX XXXXXX
Title: V.P. FINANCE, CFO
[CORPORATE SEAL]
SUNTRUST BANK, ATLANTA,
INDIVIDUALLY AND AS AGENT AND
COLLATERAL AGENT
By: /s/ Xxxx X. Xxxxxx, Xx.
-------------------------------
Name: Xxxx X. Xxxxxx, Xx.
Title: Vice President
By: /s/ X. XxXxxxxxx Xxxxxx, III
-------------------------------
Name: X. XxXxxxxxx Xxxxxx, III
Title: Group Vice President
XXXXX BROTHERS XXXXXXXX & CO.,
INDIVIDUALLY AND AS CO-AGENT
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Credit Officer
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CHASE BANK OF TEXAS, N.A.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
COMERICA BANK-TEXAS
By: /s/ Xxxxx Xxxxx
-------------------------------
Name: XXXXX XXXXX
Title: VICE PRESIDENT
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxxxx XxXxxxxx
-------------------------------
Name: XXXXXX XXXXXXXX
Title: Corporate Banking Officer
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