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EXHIBIT 10.1
AMENDMENT
FOURTH AMENDMENT AND WAIVER dated April 4, 2000 (this "Amendment "),
to the Revolving Credit Agreement, dated as of October 19, 1998 (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement"), among CINEMASTAR LUXURY THEATERS, INC., a Delaware corporation
(the "Borrower "), the several banks and other financial institutions or
entities from time to time parties thereto (the "Lenders"), and UNION BANK
OF CALIFORNIA, NA., as administrative agent (in such capacity, the
"Administrative Agent").
WITNESSETH:
WHEREAS, the Borrower has requested that the Administrative Agent and
Lenders agree to amend certain provisions and waive certain covenants of the
Credit Agreement, and, upon this Amendment becoming effective, the
Administrative Agent and Lenders have agreed to such amendments and waivers upon
the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and mutual agreements
contained herein, and for other valuable consideration the receipt of which is
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. All terms defined in the Credit Agreement shall have such
defined meanings when used herein unless otherwise deemed herein.
2. Amendment to Section 1.1. Section 1.1 of the Credit Agreement is hereby
amended as follows:
(a) by deleting and restating in their entireties the following definitions
contained in such section to read as follows:
"'Consolidated Fixed Charges Coverages Ratio': for any period, the
ratio of (a) Consolidated EBITDAR for such period plus the amount by which
the cash and cash equivalents of the Borrower and its Subsidiaries at the
end of such period exceed $500,000 to (b) Consolidated Fixed Charges for
such period."
"`Consolidated Interest Expense Coverage Ratio': for any period, the
ratio of (a) Consolidated EBITDA for such period plus the amount by which
the cash and cash equivalents of the Borrower and its Subsidiaries at the
end of such period exceed $500,000 to (b) Consolidated Interest Expense for
such period."
"`Revolving Termination Date': December 31, 2000."
(b) by adding the following definition in the proper alphabetical order:
"`Consolidated Adjusted EBITDA'; for any period, Consolidated EBITDA
for such period adjusted to delete therefrom the contribution to
Consolidated EBITDA for such period of the Internet Subsidiary."
(c) by amending and restating in its entirety clause (X) of the definition
of "Consolidated EBITDA"contained in such section as follows:
"(X) September 30, 2000 and"
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3. Amendment of Section 2.1. Section 2.1 is amended by inserting at the end
thereof the following:
"(d) notwithstanding the foregoing, until the date of receipt of the
Cash Proceeds referred to in Section 6.11 the aggregate amount of the
Revolving Extension of Credit outstanding at any time may not exceed
$3,000,000; thereafter, the aggregate amount of the Revolving Extension of
Credit outstanding at any time may not exceed $2,000,000 until such time as
the Consolidated Leverage Ratio shall be equal to or less than 4.00 to 1.00
or, if less, the then applicable ratio required pursuant to Section
7.1(a)."
4. Amendment of Section 6. Section 6 is amended by inserting immediately
after Section 6.10(e) therein the following:
"6.11 Equity Investment. (a) Obtain cash proceeds from the investment
in common equity of the Borrower by SCP of at least $3,500,000 ("Cash
Proceeds") on or prior to March 31, 2000 and (b) immediately upon receipt
thereof apply (i) $1,000,000 of the Cash Proceeds to prepay the outstanding
Loans under the Credit Agreement, and (ii) thereafter use such Cash
Proceeds solely for (x) capital expenditures related to the San Bernardino
and Mission Grove properties and (y) for working capital and repayment of
outstanding debts."
5. Amendment to Section 7 .1. Section 7.1 of the Credit Agreement is hereby
amended as follows:
(a) The requirements of Section 7.1(a) are hereby waived to the extent
and only to the extent that the Consolidated Leverage Ratio for the period
ended December 31, 1999 was greater than 4.00 to 1.00 so long as such ratio
was not greater than 4.90 to 1.00.
(b) The requirements of Section 7.1(a) are hereby waived for the
period ended March 31, 2000 such that the Consolidated Leverage Ratio is
not a factor in determining an Event of Default under the Credit Agreement.
(c) by deleting the table in Section 7.1(a) in its entirety and
substituting in lieu thereof the following table:
March 31, 1999- December 31, 1999 1.00
January 1, 2000-March 31, 2000 Not applicable
April 1, 2000- June 30, 2000 4.00 to 1.00
July 1, 2000-September 30, 2000 3.75 to 1.00
October 1, 2000-December 31, 2000 3.5 to 1.00"
(d) The requirements of Section 7.1 (d) are hereby waived to the
extent and only to the extent that the Consolidated EBITDA for the
four-quarter period ended December 31, 1999 was less than $1,500,000 so
long as such Consolidated EBITDA for such period was greater than
$1,000,000.
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(e) by deleting the table in Section 7.1 (d) in its entirety and
substituting in lieu thereof the following table:
"Fiscal Quarter Consolidated EBITDA
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March 31, 2000 $ 650,000
June 30, 2000 $ 600,000
September 30, 2000 $ 725,000
December 31, 2000 $1,200,000
6. Amendment of Section 7.2. Section 7.2(b) of the Credit Agreement is
hereby amended by inserting after the word `Guarantor' the phrase "(other than
the Internet Subsidiary)".
7. Amendment of Section 7.4. Section 7.4(a) of the Credit Agreement is
hereby amended by inserting in the first line thereof, after the word `Borrower'
the phrase "(other than the Internet Subsidiary)".
8. Amendment of Section 7.5. Section 7.5 of the Credit Agreement is hereby
amended by inserting at the end thereof the following:
"(g) to the extent that it would otherwise be prohibited, the sale of
the Chula Vista property, provided that the proceeds of such sale shall be
solely used (i) to pay in full the existing Chula Vista property mortgage
and (ii) thereafter, to prepay the Revolving Commitments in accordance with
Section 2.6(b), provided that the Reinvestment Notice exclusion shall not
be available with respect to such proceeds.
9. Amendment of Section 7.8. Section 7.8 of the Credit Agreement is hereby
(a) by inserting in paragraph (f) thereof after the word `Person' the
phrase "(other than the Internet Subsidiary)".
(b) by inserting immediately after paragraph (g) thereof the following
new paragraph (h):
"(h) The Borrower may enter into a new internet project designed to
interface with its cinema operations (the "Internet Project") provided that
(i) the Borrower establishes a subsidiary whose sole purpose is the
implementation and operation of the Internet Project (the "Internet
Subsidiary') (ii) the Internet Project is funded solely by cash common
equity investments of SCP in the Borrower that are in excess of the
$3,500,000 Cash Proceeds described in Section 6.11 and (iii) the
requirements of Section 6.10(c) are complied with at the time of the
formation of the Internet Subsidiary."
(c) by amending paragraph (h) to be the new paragraph (g) and by
inserting at the end of such new paragraph (g) the following proviso:
"provided that no Investment pursuant to this paragraph (g) may be
made in the Internet Subsidiary."
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10. Amendment of Section 8. Paragraph (c) of Section 8 is hereby amended by
inserting the clause ", Section 6.11" after the reference to Section 6.7(a)
therein.
11. Amendment of "Consolidated EBTTDA". The Credit Agreement is hereby
amended by deleting the term "Consolidated EBTTDA" in each place it appears in
the Credit Agreement (other than (a) the definitions of "Consolidated EBITDA"
and "Consolidated Adjusted EBITDA) and substituting therefor the term
"Consolidated Adjusted EBITDA."
12. Amendment to Annex A of the Credit Agreement. Annex A to the Credit
Agreement is hereby amended by replacing such Annex in its entirety with the
Annex A attached to this Amendment.
13. Amendment to Schedule 1.1A to the Credit Agreement. Schedule 1.1A to
the Credit Agreement is hereby amended by replacing such Schedule in its
entirety with the Schedule 1.1 A attached to this Amendment.
14. Consent. The Lenders hereby consent and agree, anything in Section 7.9
notwithstanding, that the Borrower may obtain the cash common equity investments
of SCP, including the $3,500,000 Cash Proceeds referred to in Section 6.11.
15. Representations;No Default. On and as of the date hereof and after
giving effect to this Amendment, the Borrower confirms, reaffirms and restates
that the representations and warranties set forth in Section 4 of the Credit
Agreement and in the other Loan Documents are true and correct in all material
respects, provided that the references to the Credit Agreement therein shall be
deemed to be references to this Amendment and to the Credit Agreement as amended
by this Amendment.
16. Conditions to Effectiveness. This Amendment shall become effective on
and as of the date that:
(a) the Administrative Agent shall have received counterparts of this
Amendment, duly executed and delivered by a duly authorized officer of each
of the Borrower, the Administrative Agent, and the Lenders;
(b) the Administrative Agent shall have received an executed
certificate of an officer of the Borrower in form satisfactory to the
Administrative Agent as to the accuracy of the Borrower's representations
and warranties set forth in Section 4 of the Credit Agreement and in the
other Loan Documents, the absence of any Default or Event of Default after
giving effect to this Amendment, and as to such other customary matters as
the Administrative Agent may reasonably request;
(c) the Borrower shall have delivered to the Administrative Agent a
copy of an effective firm commitment from SCP pursuant to which SCP agrees
to invest at least $3,500,000 in cash in common equity of the Borrower on
or prior to March 31, 2000.
(d) the Administrative Agent shall have received an amendment fee in
the amount of $20,000 and any other fees agreed upon by the Borrower and
the Administrative Agent payable to the Administrative Agent and the
Lenders.
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17. Limited Consent.Amendment. Except as expressly amended herein, the
Credit Agreement shall continue to be, and shall remain, in full force and
effect. This Amendment shall not be deemed to be a waiver of, or consent to, or
a modification or amendment of, any other term or condition of the Credit
Agreement or any other Loan Document or to prejudice any other right or rights
which the Lenders may now have or may have in the future under or in connection
with the Credit Agreement or any of the instruments or agreements referred to
therein, as the same may be amended from time to time.
18. Counterparts. This Amendment may be executed by one or more of the
parties hereto in any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
19. GOVERNING LAW. THIS AMENDMENT SHALL BE 00VFRNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, TOE LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
beduly executed and delivered by their respective proper and duly authorized
officers as of the date first above written.
CINEMASTAR LUXURY THEATER, INC., as
Borrower
By: /s/ Donald H. Harnois, Jr
-----------------------------------
Name: Donald H. Harnois, Jr.
Title: Vice President and Chief Financial Officer
UNION BANK Of CALIFORNIA, N.A., as
Administrative Agent and as a Lender
By: /s/ Jenny Dongo
-----------------------------
Name: Jenny Dongo
Title: Vice President
The undersigned does hereby
acknowledge and consent to the
terms and conditions of the foregoing Amendment
CINEMASTAR LUXURY CINEMAS, INC.
By: /s/ Donald H. Harnois, Jr
--------------------------------------
Name: Donald H. Harnois, Jr.
Title: Vice President and Chief Financial Officer
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SCHEDULE 1.1A
COMMITMENTS
Lender Revolving Commitment
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Union Bank of California, N.A. $5,000,000
