<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
AMENDMENT NO. 11
Under the Securities Exchange Act of 1934
MALIBU ENTERTAINMENT WORLDWIDE, INC.
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
(Title of Class of Securities)
561182106
(CUSIP Number)
RICHARD M. FITZPATRICK
MEI HOLDINGS, L.P.
2200 ROSS AVENUE
SUITE 4200
DALLAS, TEXAS 75201
(214) 220-4900
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
With a copy to:
ROBERT A. PROFUSEK, ESQ.
JONES, DAY, REAVIS & POGUE
599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022
(212) 326-3939
MARCH 27, 1998
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with this statement [ ].
<PAGE> 2
- --------------------------------------------------------------------------------
CUSIP No. 561182106 13D-1 Page 2
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MEI Holdings, L.P
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 3
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CUSIP No. 561182106 13D-1 Page 3
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MEI GenPar, L.P.
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 4
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CUSIP No. 561182106 13D-1 Page 4
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
HH GenPar Partners
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 5
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CUSIP No. 561182106 13D-1 Page 5
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hampstead Associates, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 6
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CUSIP No. 561182106 13D-1 Page 6
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RAW GenPar, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 7
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CUSIP No. 561182106 13D-1 Page 7
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
InMed, Inc. d/b/a Incap, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Texas
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 8
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CUSIP No. 561182106 13D-1 Page 8
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Donald J. McNamara
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 9
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CUSIP No. 561182106 13D-1 Page 9
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert A. Whitman
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 10
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CUSIP No. 561182106 13D-1 Page 10
================================================================================
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Daniel A. Decker
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
00
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(e) or 2(f) |_|
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
- --------------------------------------------------------------------------------
7 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
39,323,513(1)
- --------------------------------------------------------------------------------
8 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN
SHARES* |_|
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
81.4%
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Does not reflect additional Common Shares to which the Reporting Person may
be entitled, without the payment of additional consideration, upon the
occurrence of certain future events beyond the Reporting Persons' control.
See Item 5.
<PAGE> 11
This Amendment No. 11 amends and supplements the Statement on
Schedule 13D first filed on June 17, 1996, as amended by Amendments No. 1
through 10 (the "Schedule 13D"), by MEI Holdings, L.P., a Delaware limited
partnership ("Holdings"), and certain other persons.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
Item 5 is hereby amended to add the following at the end thereof:
The Company's $9.5 million and $30.0 million promissory notes payable
to Holdings have been amended (as so amended, the "Notes") to, among other
things, (i) in the case of the $9.5 million note, extend the maturity from
September 1998 to January 1999, (ii) to increase the principal amounts to $10.0
million and $65.0 million, respectively, and (iii) to provide that the Notes are
convertible at Holdings' option into subordinated notes that are convertible
into Common Stock of the Company ("Convertible Notes"). The Convertible Notes
will have terms that an independent investment adviser advises the Company and
Holdings would ensure that the proceeds of a sale at the time of conversion into
Convertible Notes would be sufficient to repay the then-outstanding interest and
principal on the Notes and all third party costs incurred in connection
therewith. The amounts currently outstanding under the Notes are $8.5 million
and $39.8 million, respectively. Holdings is permitted, but is not required, to
advance additional funds up to the principal amounts under the Notes. The $65.0
million note matures in August 2001.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
Item 6 is hereby amended to add the following:
The last paragraph of Item 5 is incorporated herein by this reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1 Second Amended and Restated Subordinated Promissory Note, dated
March 27, 1998
Exhibit 2 Amended and Restated Promissory Note, dated March 27, 1998
<PAGE> 12
SIGNATURES
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement may
be filed collectively on behalf of it and each of the other signatories hereto.
Dated: April 1, 1998
MEI HOLDINGS, L.P.
By: MEI GenPar, L.P.
Its General Partner
By: HH GenPar Partners
Its General Partner
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
Executive Vice President
MEI GENPAR, L.P.
By: HH GenPar Partners
Its General Partner
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
Executive Vice President
HH GENPAR PARTNERS
By: Hampstead Associates, Inc.
Its Managing General Partner
By: /s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
Executive Vice President
HAMPSTEAD ASSOCIATES, INC.
By: /s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
Executive Vice President
<PAGE> 13
RAW GENPAR, INC.
By: /s/ ROBERT A. WHITMAN
-----------------------------------
Robert A. Whitman
President
INMED, INC.
By: /s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
President
/s/ DONALD J. MCNAMARA
-----------------------------------
Donald J. McNamara
/s/ ROBERT A. WHITMAN
-----------------------------------
Robert A. Whitman
/s/ DANIEL A. DECKER
-----------------------------------
Daniel A. Decker
<PAGE> 14
INDEX TO EXHIBITS
Exhibit Description
1 Second Amended and Restated Subordinated Promissory Note, dated March 27,
1998
2 Amended and Restated Promissory Note, dated March 27, 1998
<PAGE> 1
Exhibit 1
ALL INDEBTEDNESS EVIDENCED BY THIS AMENDED AND RESTATED SUBORDINATED
PROMISSORY NOTE IS SUBORDINATED TO OTHER INDEBTEDNESS PURSUANT TO, AND
TO THE EXTENT PROVIDED IN, AND IS OTHERWISE SUBJECT TO THE TERMS OF,
THE AMENDED AND RESTATED SUBORDINATION AGREEMENT, DATED AS OF JUNE 27,
1997, AS THE SAME MAY BE AMENDED, SUPPLEMENTED OR OTHERWISE MODIFIED
FROM TIME TO TIME, BY AND AMONG MALIBU ENTERTAINMENT WORLDWIDE, INC.,
AS BORROWER, MEI HOLDINGS, L.P., AS SUBORDINATED LENDER, AND FOOTHILL
CAPITAL CORPORATION, AS SENIOR LENDER.
SECOND AMENDED AND RESTATED SUBORDINATED PROMISSORY NOTE
$65,000,000 New York, N.Y.
March 27, 1998
FOR VALUE RECEIVED, the undersigned, Malibu Entertainment Worldwide,
Inc., a Georgia corporation ("Maker"), promises to pay to the order of MEI
Holdings, L.P., a Delaware limited partnership (together with any subsequent
holder of this Note, "Holder"), at its offices located at c/o The Hampstead
Group, 2200 Ross Avenue., Suite 4200 West, Dallas, Texas 75201, or at such other
address or to such account as Holder may from time to time designate in writing,
the unpaid principal sum of all advances made by Holder to Maker from time to
time in an aggregate principal amount of up to Sixty Five Million United States
Dollars ($65,000,000), together with interest thereon from the date hereof on
the unpaid principal balance at the rate and otherwise as herein provided.
Unless otherwise specified by Holder in writing, all payments on this Note shall
be made in lawful money of the United States of America and in immediately
available funds.
Interest shall accrue on the unpaid principal balance of this Note at
the rate of ten percent (10%) per annum. Accrued but unpaid interest shall be
compounded annually. Interest on the unpaid principal balance of this Note shall
be computed on the actual number of days elapsed, and a year of 360 days.
The unpaid principal amount of this Note and all accrued and unpaid
interest thereon shall become due and be paid on August 31, 2001 (the "Maturity
Date"). Maker may, at its option and upon three (3) Business Days' prior written
notice from Maker to Holder, prepay in whole or in part the outstanding
principal balance of this Note without payment of any premium or penalty.
Holder shall maintain an account or accounts evidencing the
indebtedness of Maker to Holder resulting from each advance made by Holder,
including the amount of principal
<PAGE> 2
and interest payable and paid to Holder from time to time hereunder. The entries
made in such account or accounts shall be prima facie evidence of the existence
and the amounts of the obligations recorded therein, provided that any failure
of Holder to maintain such account or accounts or any error therein shall not in
any manner affect the obligation of Maker to repay the advances made by Holder
to Maker in accordance with the terms of this Note.
Maker agrees and acknowledges that Holder has no commitment of
any kind to advance funds to Maker and that all advances previously made by
Holder to Maker and all advances, if any, that may be made by Holder to Maker in
the future have been made and will be made at the sole and absolute discretion
of Holder.
Maker shall use the proceeds of the loan evidenced by this
Note solely to fund its working capital requirements and to repay indebtedness
of the Maker the proceeds of which were used by Maker solely to fund its working
capital requirements.
If Maker fails to make any payment of principal, accrued and
unpaid interest or any other amount due hereunder on any due date therefor,
whether at stated maturity or otherwise, the unpaid amount (including, to the
extent enforceable at law, any unpaid amount of interest) shall bear interest
until paid at a rate per annum equal to the lesser of eighteen percent (18%) per
annum and the maximum rate of interest permitted by applicable law (the "Maximum
Amount"). Maker shall also pay to Holder, in addition to the amount due, all
reasonable costs and expenses incurred by Holder in collecting or enforcing, or
attempting to collect or enforce this Note, including without limitation court
costs and reasonable attorneys' fees and expenses (including reasonable
attorneys' fees and expenses on any appeal by either Maker or Holder and in any
bankruptcy proceeding).
With respect to the amounts due pursuant to this Note, Maker
waives demand, presentment, protest, notice of dishonor, notice of nonpayment,
suit against any party, diligence in collection of this Note, and all other
requirements necessary to enforce this Note.
In no event shall any amount deemed to constitute interest due
or payable hereunder (including interest calculated at the Default Rate) exceed
the Maximum Amount, and in the event such payment is inadvertently paid by Maker
or inadvertently received by Holder, then such sum shall be credited as a
payment of principal or other amounts (other than interest) outstanding
hereunder, and, if in excess of the outstanding amount of principal or other
amounts outstanding hereunder, shall be immediately returned to Maker upon such
determination. It is the express intent hereof that Maker not pay and Holder not
receive, directly or indirectly, interest in excess of the Maximum Amount.
Holder may, at any time during the term of this Note
(including any extensions of the term hereof), by written notice to Maker,
convert this Note into one or more subordinated convertible notes (the
"Convertible SubNotes") having terms that the Investment Banker (as defined
below) advises Maker and Holder (which advice will be in the form of a written
term sheet but need not be given in the form of a formal opinion) would be
required to ensure that the proceeds to Holder of an immediate sale of the
Convertible SubNote would be sufficient to repay
<PAGE> 3
the sum of (i) the then-outstanding principal and interest on this Note and (ii)
all third party costs incurred by the Maker and the Holder in an assumed
secondary public offering by Holder of the Convertible SubNote, including
without limitation any SEC or other filing fees, printing expenses, underwriting
discounts and fees and other fees and expenses (including attorneys' and
accountants' fees and expenses). Within 20 calendar days of Maker's receipt of
the foregoing notice, Merrill Lynch, Pierce Fenner & Smith Incorporated ("ML")
or, if such firm is unwilling or unable to serve, another nationally recognized
investment banking firm will be selected by Holder and the members of the Board
of Directors of Maker not affiliated with Holder or employed by Maker (ML or
such other firm, the "Investment Banker"). In its engagement of the Investment
Banker, Maker will obtain the Investment Banker's agreement to render such
advice as promptly as is practicable. If Holder is advised by legal counsel that
shareholder approval of the issuance of the Convertible SubNote or the issuance
of Common Stock upon conversion of the Convertible SubNote is required by law or
stock exchange rule, Maker will seek shareholder approval of the issuance of the
Convertible SubNotes at the earlier of the next annual or special meeting of
shareholders after the date hereof. The Convertible SubNote and any Shares
issued to the holder thereof upon conversion of the Convertible SubNote will be
"Registrable Securities" under the Registration Rights Agreement, dated as of
August 28, 1996, by and between Maker and Holder. Maker will be responsible for
all of its and Holder's fees and expenses (including the Investment Bankers' and
any attorneys' fees and expenses) in connection the execution and delivery of
the amendment and restatement of this Note and any other matters contemplated by
this Note.
Holder shall not by any act, delay, omission, or otherwise be deemed to
have modified, amended, waived, extended, discharged, or terminated any of its
rights or remedies, and no modification, amendment, waiver, extension,
discharge, or termination of any kind shall be valid unless in writing and
signed by Holder. All rights and remedies of Holder under the terms of this Note
and applicable statutes or rules of law shall be cumulative, and may be
exercised successively or concurrently. Maker agrees that there are no defenses,
equities, or setoffs with respect to the obligations set forth herein, and to
the extent any such defenses, equities, or setoffs may exist, the same are
hereby expressly released, forgiven, waived, and forever discharged. The
obligations of Maker hereunder shall be binding upon and enforceable against
Maker and its successors and assigns and shall inure to the benefit of Holder
and its successors and assigns.
Wherever possible, each provision of this Note shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Note is prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Note.
This Note was negotiated in New York, and made by Holder and accepted
by Maker in the State of New York, which State the parties agree has a
substantial relationship to the parties and to the underlying transaction
embodied hereby, and in all respects, including without limitation matters of
construction, validity, and performance, this Note and the obligations arising
hereunder shall be governed by, and construed in accordance with, the internal
<PAGE> 4
laws of the State of New York and any applicable law of the United States of
America. To the fullest extent permitted by law, Maker hereby unconditionally
and irrevocably waives any claim to assert that the laws of any other
jurisdiction governs this Note, and this Note shall be governed by and construed
in accordance with the laws of the State of New York pursuant to ss. 5-1401 of
the New York General Obligations Law.
MAKER, TO THE FULLEST EXTENT THAT IT MAY LAWFULLY DO SO, WAIVES TRIAL
BY JURY IN ANY ACTION OR PROCEEDING, INCLUDING WITHOUT LIMITATION ANY TORT
ACTION, BROUGHT WITH RESPECT TO THIS NOTE. HOLDER MAY FILE A COPY OF THIS WAIVER
WITH ANY COURT AS WRITTEN EVIDENCE OF MAKER'S KNOWING, VOLUNTARY, AND
BARGAINED-FOR AGREEMENT IRREVOCABLY TO WAIVE ITS RIGHTS TO TRIAL BY JURY, AND
THAT, TO THE FULLEST EXTENT THAT IT MAY LAWFULLY DO SO, ANY DISPUTE OR
CONTROVERSY WHATSOEVER BETWEEN MAKER AND HOLDER SHALL INSTEAD BE TRIED IN A
COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
Maker may not assign or delegate this Note or any of its rights or
obligations hereunder without the prior consent of Holder (which consent may be
given or withheld in the sole discretion of Holder). Holder may assign or
delegate this Note or any of its rights or obligations hereunder without prior
consent of or notice to Maker.
This Note amends and restates the $30,000,000 Amended and Restated
Subordinated Promissory Note, dated June 5, 1997, from Maker payable to the
order of Holder and is being issued in replacement of and in substitution for
such promissory note.
IN WITNESS WHEREOF, Maker has caused this Note to be duly executed on
its behalf as of the day and year first above written.
MALIBU ENTERTAINMENT WORLDWIDE, INC.
By:
-----------------------------------------
Name: Richard M. FitzPatrick
Title: Vice President
<PAGE> 1
EXHIBIT 2
AMENDED AND RESTATED PROMISSORY NOTE
$10,000,000 Dallas, Texas
March 27, 1998
FOR VALUE RECEIVED, the undersigned, MALIBU ENTERTAINMENT WORLDWIDE,
INC., a Georgia corporation ("Maker"), promises to pay to the order of MEI
Holdings, L.P., a Delaware limited partnership (together with any subsequent
holder of this Note, "Holder"), at its offices located at c/o The Hampstead
Group, 2200 Ross Avenue., Suite 4200 West, Dallas, Texas 75201, or at such other
address or to such account as Holder may from time to time designate in writing,
the unpaid principal sum of all advances made by Holder to Maker from time to
time in an aggregate principal amount of up to Ten Million United States Dollars
($10,000,000), together with interest thereon from the date hereof on the unpaid
principal balance at the rate and otherwise as herein provided. Unless otherwise
specified by Holder in writing, all payments on this Note shall be made in
lawful money of the United States of America and in immediately available funds.
The unpaid principal amount of this Note and all accrued and unpaid
interest thereon shall become due and be paid on January 20, 1999 (the "Maturity
Date").
Maker may, at its option and upon three (3) Business Days' prior
written notice from Maker to Holder, prepay in whole or in part the outstanding
principal balance of this Note without payment of any premium or penalty;
provided, however, that in the event that Maker makes any prepayment of such
principal balance on a day other than the last day of an interest period, Maker
shall reimburse Holder for any costs, fees or expenses incurred by Holder in
connection with such prepayment including, without limitation, costs, fees and
expenses associated with the unwinding of any LIBOR contract.
For purposes of this Note: (i) "Applicable Interest Rate" shall mean a
rate per annum equal to LIBOR plus 350 basis points, which Applicable Interest
Rate for each one-month interest period shall be determined monthly on the
Determination Date immediately preceding such interest period; (ii) "Business
Day" shall mean any day other than a Saturday, Sunday or any other day on which
national banks in New York, New York are not open for business; (iii) "Default
Rate" shall mean a rate per annum (adjusted monthly on each Determination Date)
equal to the Applicable Interest Rate plus 500 basis points; provided, however,
in no event shall such rate exceed the maximum rate permitted by applicable law;
(iv) "Determination Date" shall mean the date which is two Eurodollar Business
Days prior to the first day of a calendar month; (v) "Eurodollar Business Day"
shall mean a Business Day on which banks in the City of London, England, are
open for interbank or foreign exchange transactions; and (vi) "LIBOR" shall mean
the rate (expressed as a percentage per annum) for deposits in U.S. dollars, for
a one-month period, that appears on Telerate Page 3750 (or the successor
thereto) as of 11:00 a.m., London,
<PAGE> 2
England time, on the related Determination Date. If such rate does not appear on
Telerate Page 3750 as of 11:00 a.m., London, England time, on the related
Determination Date, LIBOR shall be the arithmetic mean of the offered rates
(expressed as a percentage per annum) for deposits in U.S. dollars for a
one-month period that appear on the Reuters Screen LIBOR Page as of 11:00 a.m.,
London, England time, on such Determination Date, if at least two such offered
rates so appear. If fewer than two such offered rates appear on the Reuters
Screen LIBOR Page as of 11:00 a.m., London, England time, on such Determination
Date, Holder shall request the principal London, England office of any four
major reference banks in the London interbank market selected by Holder to
provide such bank's offered quotation (expressed as a percentage per annum) to
prime banks in the London interbank market for deposits in U.S. dollars for a
one-month period as of 11:00 a.m., London, England time, on such Determination
Date for amounts of not less than U.S. $1,000,000. If at least two such offered
quotations are so provided, LIBOR shall be the arithmetic mean of such
quotations. If fewer than two such offered quotations are so provided, Holder
shall request any three major banks in New York City selected by Holder to
provide such bank's rate (expressed as a percentage per annum) for loans in U.S.
dollars to leading European banks for a one-month period as of approximately
11:00 a.m., New York City time, on the applicable Determination Date for amounts
of not less than U.S. $1,000,000. If at least two such rates are so provided,
LIBOR shall be the arithmetic mean of such rates. If fewer than two such rates
are so provided, then LIBOR shall be LIBOR as in effect on the Eurodollar
Business Day immediately preceding the applicable Determination Date. LIBOR
shall be determined in accordance with this paragraph by Holder or its agent.
Maker shall pay interest, in arrears for each one-month LIBOR interest
period (or portion thereof) from and including the first Business Day of each
calendar month (or from the date hereof in the case of the initial interest
period) to but excluding the first Business Day of the immediately succeeding
calendar month, on the unpaid principal balance of this Note from time to time
outstanding at the Applicable Interest Rate determined for each such one-month
interest period on the immediately preceding Determination Date, on the first
Business Day of each calendar month during the term of this Note. The balance of
the unpaid principal of this Note together with all accrued and unpaid interest
thereon shall be paid on the Maturity Date, all in accordance with the terms and
provisions set forth herein. Interest on the unpaid principal balance of this
Note shall be computed on the actual number of days elapsed, and a year of 360
days.
Holder shall maintain an account or accounts evidencing the
indebtedness of Maker to Holder resulting from each advance made by Holder,
including the amount of principal and interest payable and paid to Holder from
time to time hereunder. The entries made in such account or accounts shall be
prima facie evidence of the existence and the amounts of the obligations
recorded therein, provided that any failure of Holder to maintain such account
or accounts or any error therein shall not in any manner affect the obligation
of Maker to repay the advances made by Holder to Maker in accordance with the
terms of this Note.
Maker agrees and acknowledges that Holder has no commitment of any kind
to advance funds to Maker and that all advances previously made by Holder to
Maker and all advances, if
<PAGE> 3
any, that may be made by Holder to Maker in the future have been made and will
be made at the sole and absolute discretion of Holder.
If Maker fails to make any payment of principal, accrued and unpaid
interest or any other amount due hereunder on any due date therefor, whether at
stated maturity or otherwise, the unpaid amount (including, to the extent
enforceable at law, any unpaid amount of interest) shall bear interest at the
Default Rate until paid. Maker shall also pay to Holder, in addition to the
amount due, all reasonable costs and expenses incurred by Holder in collecting
or enforcing, or attempting to collect or enforce this Note, including without
limitation court costs and reasonable attorneys' fees and expenses (including
reasonable attorneys' fees and expenses on any appeal by either Maker or Holder
and in any bankruptcy proceeding).
With respect to the amounts due pursuant to this Note, Maker waives
demand, presentment, protest, notice of dishonor, notice of nonpayment, suit
against any party, diligence in collection of this Note, and all other
requirements necessary to enforce this Note.
In no event shall any amount deemed to constitute interest due or
payable hereunder (including interest calculated at the Default Rate) exceed the
maximum rate of interest permitted by applicable law (the "Maximum Amount"), and
in the event such payment is inadvertently paid by Maker or inadvertently
received by Holder, then such sum shall be credited as a payment of principal or
other amounts (other than interest) outstanding hereunder, and, if in excess of
the outstanding amount of principal or other amounts outstanding hereunder,
shall be immediately returned to Maker upon such determination. It is the
express intent hereof that Maker not pay and Holder not receive, directly or
indirectly, interest in excess of the Maximum Amount.
Holder may, at any time during the term of this Note (including any
extensions of the term hereof), by written notice to Maker, convert this Note
into one or more subordinated convertible notes (the "Convertible SubNotes")
having terms that the Investment Banker (as defined below) advises Maker and
Holder (which advice will be in the form of a written term sheet but need not be
given in the form of a formal opinion) would be required to ensure that the
proceeds to Holder of an immediate sale of the Convertible SubNote would be
sufficient to repay the sum of (i) the then-outstanding principal and interest
on this Note and (ii) all third party costs incurred by the Maker and the Holder
in an assumed secondary public offering by Holder of the Convertible SubNote,
including without limitation any SEC or other filing fees, printing expenses,
underwriting discounts and fees and other fees and expenses (including
attorneys' and accountants' fees and expenses). Within 20 calendar days of
Maker's receipt of the foregoing notice, Merrill Lynch, Pierce Fenner & Smith
Incorporated ("ML") or, if such firm is unwilling or unable to serve, another
nationally recognized investment banking firm will be selected by Holder and the
members of the Board of Directors of Maker not affiliated with Holder or
employed by Maker (ML or such other firm, the "Investment Banker"). In its
engagement of the Investment Banker, Maker will obtain the Investment Banker's
agreement to render such advice as promptly as is practicable. If Holder is
advised by legal counsel that shareholder approval of the issuance of the
Convertible SubNote or the issuance of Common Stock upon conversion of the
Convertible SubNote is required by law or stock exchange rule, Maker will seek
shareholder approval of the issuance of the Convertible SubNotes at the earlier
of the next annual or special
<PAGE> 4
meeting of shareholders after the date hereof. The Convertible SubNote and any
Shares issued to the holder thereof upon conversion of the Convertible SubNote
will be "Registrable Securities" under the Registration Rights Agreement, dated
as of August 28, 1996, by and between Maker and Holder. Maker will be
responsible for all of its and Holder's fees and expenses (including the
Investment Bankers' and any attorneys' fees and expenses) in connection the
execution and delivery of the amendment and restatement of this Note and any
other matters contemplated by this Note.
Holder shall not by any act, delay, omission, or otherwise be deemed to
have modified, amended, waived, extended, discharged, or terminated any of its
rights or remedies, and no modification, amendment, waiver, extension,
discharge, or termination of any kind shall be valid unless in writing and
signed by Holder. All rights and remedies of Holder under the terms of this Note
and applicable statutes or rules of law shall be cumulative, and may be
exercised successively or concurrently. Maker agrees that there are no defenses,
equities, or setoffs with respect to the obligations set forth herein, and to
the extent any such defenses, equities, or setoffs may exist, the same are
hereby expressly released, forgiven, waived, and forever discharged. The
obligations of Maker hereunder shall be binding upon and enforceable against
Maker and its successors and assigns and shall inure to the benefit of Holder
and its successors and assigns.
Wherever possible, each provision of this Note shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Note is prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the Note.
This Note was negotiated in Texas, and made by Holder and accepted by
Maker in the State of Texas, which State the parties agree has a substantial
relationship to the parties and to the underlying transaction embodied hereby,
and in all respects, including without limitation matters of construction,
validity, and performance, this Note and the obligations arising hereunder shall
be governed by, and construed in accordance with, the internal laws of the State
of Texas and any applicable law of the United States of America. To the fullest
extent permitted by law, Maker hereby unconditionally and irrevocably waives any
claim to assert that the laws of any other jurisdiction governs this Note.
MAKER, TO THE FULLEST EXTENT THAT IT MAY LAWFULLY DO SO, WAIVES TRIAL
BY JURY IN ANY ACTION OR PROCEEDING, INCLUDING WITHOUT LIMITATION ANY TORT
ACTION, BROUGHT WITH RESPECT TO THIS NOTE. HOLDER MAY FILE A COPY OF THIS WAIVER
WITH ANY COURT AS WRITTEN EVIDENCE OF MAKER'S KNOWING, VOLUNTARY, AND BARGAINED
FOR AGREEMENT IRREVOCABLY TO WAIVE ITS RIGHTS TO TRIAL BY JURY, AND THAT, TO THE
FULLEST EXTENT THAT IT MAY LAWFULLY DO SO, ANY DISPUTE OR CONTROVERSY WHATSOEVER
BETWEEN MAKER AND HOLDER SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
<PAGE> 5
Maker may not assign or delegate this Note or any of its rights or
obligations hereunder without the prior consent of Holder (which consent may be
given or withheld in the sole discretion of Holder). Holder may assign or
delegate this Note or any of its rights or obligations hereunder without prior
consent of or notice to Maker.
This indebtedness evidenced by this Note constitutes "Current MEIH
Advances" under that certain Consolidated, Amended, and Restated Loan and
Security Agreement, dated as of August 22, 1996 and as amended, supplemented and
otherwise modified from time to time, by and among Foothill Capital Corporation,
Maker and various subsidiaries of Maker.
This Note amends and restates the $9,500,000 Promissory Note, dated as
of June 5, 1997, from Maker payable to the order of Holder and is being issued
in replacement of and in substitution for such promissory note.
IN WITNESS WHEREOF, Maker has caused this Note to be duly executed on
its behalf as of the day and year first above written.
MALIBU ENTERTAINMENT WORLDWIDE, INC.
By:
---------------------------------------
Richard M. FitzPatrick
Vice President
