Exhibit 10.1
 
FIRST AMENDMENT TO CREDIT AGREEMENT
 
This FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made effective as
of January 1, 2012, by and among WILHELMINA INTERNATIONAL, INC., a Delaware
corporation, (“Borrower”), AMEGY BANK NATIONAL ASSOCIATION, a national banking
association (“Lender”), and each of the Guarantors set forth on the signature
pages hereof (each a “Guarantor”, and collectively the “Guarantor”).
 
RECITALS
 
A. Borrower and Lender entered into that certain Credit Agreement dated as of
April 20, 2011 (the “Credit Agreement”).
 
B. In connection with the Credit Agreement, Borrower executed and delivered to
Lender that certain Line of Credit Promissory Note dated April 20, 2011, in the
stated principal amount of $500,000.00 (the “Existing Line of Credit Note”).
 
C. In connection with the Credit Agreement, Guarantors executed and delivered to
Lender that certain Guaranty Agreement dated as of April 20, 2011 (the
“Guaranty”).
 
D. Borrower has requested Lender (i) to extend additional credit to Borrower,
(ii) to extend the maturity date of the Existing Line of Credit Note, and (iii)
to amend the Credit Agreement in certain respects, and Lender has agreed to the
same upon the terms and conditions hereinafter set forth.
 
NOW, THEREFORE, in consideration of the premises herein contained and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
 
ARTICLE I
DEFINITIONS
 
Section 1.1. Definitions.  Capitalized terms used in this Amendment, to the
extent not otherwise defined herein, shall have the same meaning as assigned to
them in the Credit Agreement, as amended hereby.
 
ARTICLE II
AMENDMENTS
 
Section 2.1. Amendment to Section 1.1(a) and (b) of the Credit
Agreement.  Section 1.1(a) and (b) of the Credit Agreement are hereby amended
and restated in their entirety to hereafter read as follows.
 
“(a)           Line of Credit.  Subject to the terms and conditions of this
Agreement, Bank hereby agrees to make advances to Borrower from time to time up
to and including December 31, 2012 not to exceed at any time the aggregate
principal amount of One Million Five Hundred Thousand Dollars ($1,500,000.00)
(“Line of Credit”), the proceeds of which shall be used (i) to pay fees and
expenses incurred in connection with this Agreement and the transaction
contemplated hereby, (ii) to pay in full that certain promissory note dated
December 31, 2009 in the original principal amount of $1,750,000.00 executed by
Borrower and payable to Dieter Esch, as amended, renewed and extended pursuant
to Amendment to Promissory Note dated December 10, 2010 and (iii) for working
capital and other general business purposes of Borrower.  Borrower’s obligation
to repay advances under the Line of Credit shall be evidenced by an Amended and
Restated Line of Credit Promissory Note dated as of January 1, 2012, in the
stated principal amount of $1,500,000.00 (as such promissory note may be
amended, restated, refinanced or otherwise modified from time to time, “Line of
Credit Note”), all terms of which are incorporated herein by this reference.
 
 
 

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(b)           Limitation on Borrowings.  Outstanding borrowings under the Line
of Credit, to a maximum of the principal amount set forth above, shall not at
any time exceed the then-current borrowing base (the “Borrowing Base”) equal to
the following amount as determined in good faith by Bank based upon a Borrowing
Base Certificate (herein so called) in the form of Exhibit A attached hereto and
incorporated herein by reference or in such other form as may be acceptable to
Bank and such other information as Bank may consider relevant to such
determination: the lesser of (i) $1,500,000.00 or (ii) an amount equal to
sixty-five percent (65%) of the aggregate value of Borrower’s Eligible Accounts
Receivable, (which lesser amount, as of any date of determination, is
hereinafter called the “Borrowing Base Amount”).  All of the foregoing shall be
determined by Bank upon receipt and review of all collateral reports required
hereunder and such other documents and collateral information as Bank may from
time to time reasonably require.  Borrower acknowledges that the Borrowing Base
was established by Bank with the understanding that, among other items, the
aggregate of all returns, rebates, discounts, credits and allowances for the
immediately preceding three (3) months at all times shall be less than five
percent (5%) of Borrower’s aggregate gross sales for said period.  If such
dilution of Borrower’s accounts for the immediately preceding three (3) months
at any time exceeds five percent (5%) of Borrower’s aggregate gross sales for
said period, or if there at any time exists any other matters, events,
conditions or contingencies which Bank reasonably believes may affect payment of
any portion of any Borrower’s accounts, Bank, in its sole discretion, may reduce
the foregoing advance rate against Eligible Accounts Receivable to a percentage
appropriate to reflect such additional dilution and/or establish additional
reserves against Borrowers’ Eligible Accounts Receivable.
 
As used herein, “Eligible Accounts Receivable” shall mean and consist solely of
trade accounts created in the ordinary course of Borrower’s business, upon which
Borrower’s right to receive payment is absolute and not contingent upon the
fulfillment of any condition whatsoever, and in which Bank has a perfected
security interest of first priority, and shall not include:
 
(i) any account which is unpaid more than ninety (90) days past the initial
invoice date therefor;
 
(ii) that portion of any account for which there exists any right of setoff,
defense or discount (except regular discounts allowed in the ordinary course of
business to promote prompt payment) or for which any defense or counterclaim has
been asserted;
 
(iii) any account which represents an obligation of any state or municipal
government or of the United States government or any political subdivision
thereof;
 
(iv) any account which represents an obligation of an account debtor located in
a foreign country;
 
 
 

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(v) any account which arises from the sale or lease to or performance of
services for, or represents an obligation of, an employee, affiliate, partner,
member, parent or subsidiary of Borrower;
 
(vi) that portion of any account, which represents interim or progress billings
or retention rights on the part of the account debtor;
 
(vii) any account which represents an obligation of any account debtor when
twenty percent (20%) or more of Borrower’s accounts from such account debtor are
not eligible pursuant to (i) above;
 
(viii) that portion of any account from an account debtor which represents the
amount by which such Borrower’s total accounts from said account debtor exceeds
twenty percent (20%) of Borrower’s total accounts; or
 
(ix) any account deemed ineligible by Bank when Bank, in its sole discretion,
deems the creditworthiness or financial condition of the account debtor, or the
industry in which the account debtor is engaged, to be unsatisfactory.”
 
Section 2.2. Amendment to Subsection (a) of Section 4.9 of the Credit
Agreement.  Subsection (a) of Section 4.9 of the Credit Agreement is amended and
restated in its entirety to hereafter read as follows:
 
“(a)           Minimum Net Worth.  Minimum Net Worth of not less than
$21,250,000.00 on a quarterly basis, determined as of each fiscal quarter end.
 
For purposes hereof the following terms shall have the meanings indicated:
 
“Minimum Net Worth” means, with respect to the Loan Parties as of the date of
calculation, the Total Assets of the Loan Parties minus the Total Liabilities of
the Loan Parties.
 
“Total Assets” means, with the respect to the Loan Parties as of the date of
calculation, all assets (both current and non-current) which in conformity with
generally accepted accounting principles, would be included as assets on a
consolidated balance sheet of the Loan Parties.
 
“Total Liabilities” means, with respect to the Loan Parties as of the date of
calculation, all amounts which in conformity with generally accepted accounting,
would be included as liabilities on a consolidated balance sheet of the Loan
Parties.”
 
ARTICLE III
CONDITIONS PRECEDENT
 
Section 3.1. Conditions.  The effectiveness of this Amendment is subject to the
satisfaction of the following conditions precedent, unless specifically waived
by the Lender:
 
(a) The following instruments shall have been duly and validly executed and
delivered to Lender by the parties thereto, all in form, scope and content
satisfactory to the Lender:
 
(i) this Amendment executed by Borrower and Guarantors;
 
 
 

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(ii) Amended and Restated Line of Credit Promissory Note dated of even date with
this Amendment in the stated principal amount of $1,500,000.00 executed by
Borrower and payable to the order of Lender (the “Amended and Restated Line of
Credit Note”) which, in part represents a renewal of the Existing Line of Credit
Note and, in part, represents an advance of additional monies to Borrower by
Lender (the Existing Line of Credit Note, as amended and restated by the Amended
and Restated Line of Credit Note is herein called the “Line of Credit Note”);
 
(iii) First Amendment to Pledge and Security Agreement dated of even date with
this Amendment executed by Borrower and each Guarantor (the “First Amendment to
Security Agreement”); and
 
(iv) Resolutions of the Board of Directors (or other governing body) of Borrower
and each Guarantor certified by the Secretary or an Assistant Secretary (or
other custodian of records of each such entity) which authorize the execution,
delivery, and performance by Borrower and each Guarantor of this Amendment and
the other Loan Documents to be executed in connection herewith.
 
(b) The representations and warranties contained herein, in the Credit
Agreement, as amended hereby, and in each other Loan Document shall be true and
correct as of the date hereof, as if made on the date hereof, except to the
extent such representation and warranties relate to an earlier date.
 
(c) No Event of Default shall have occurred and be continuing and no Default
shall exist, unless such Event of Default or Default has been specifically
waived in writing by Lender.
 
(d) All corporate proceedings taken in connection with the transactions
contemplated by this Amendment and all documents, instruments and other legal
matters incident thereto, shall be satisfactory to Lender and its legal counsel.
 
(e) There shall have been no material adverse change in the condition (financial
or otherwise) of Borrower or any Guarantor since April 20, 2011.
 
ARTICLE IV
RATIFICATIONS, REPRESENTATIONS, WARRANTIES
 
Section 4.1. Ratifications.  The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Credit Agreement and except as expressly modified and superseded by
this Amendment, the terms and provisions of the Credit Agreement and the other
Loan Documents are ratified and confirmed and shall continue in full force and
effect.  Borrower and Guarantors agree that the Credit Agreement, as amended
hereby, and the other Loan Documents shall continue to be legal, valid, binding
obligations of Borrower and Guarantors, enforceable against Borrower and
Guarantors in accordance with their respective terms.
 
Section 4.2. Renewal of Security Interests.  Borrower hereby renews, regrants
and affirms the liens and security interests created and granted in the Credit
Agreement and in all other Loan Documents (including, without limitation, that
certain Pledge and Security Agreement dated April 20, 2011 executed by Borrower
and Guarantors, as amended by the First Amendment to Security Agreement), secure
the prompt payment of all indebtedness and obligations of Borrower and each
Guarantor under the Loan Documents as amended and increased by the terms
hereof.  Borrower and Guarantors agree that this Amendment shall in no manner
affect or impair the liens and security interests securing the indebtedness of
Borrowers and Guarantors to Lender and that such liens and security interests
shall not in any manner be waived, the purposes of this Amendment being to
modify the Credit Agreement as herein provided, and to carry forward all liens
and security interests securing same, which are acknowledged by Borrower and
Guarantors to be valid and subsisting.
 
 
 

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Section 4.3. Representations and Warranties.  Borrower and Guarantors hereby
represent and warrant to Lender as follows:
 
(a) The execution, delivery and performance of this Amendment and any and all
other Loan Documents executed and delivered in connection herewith have been
authorized by all requisite corporate action on the part of Borrower and each
Guarantor and do not and will not conflict with or violate any provision of any
applicable laws, rules, regulations or decrees, the organizational documents of
Borrower or any Guarantor, or any agreement, document, judgment, license, order
or permit applicable to or binding upon Borrower or any Guarantor or their
respective assets.  No consent, approval, authorization or order of, and no
notice to or filing with, any court or governmental authority or third person is
required in connection with the execution, delivery or performance of this
Amendment or to consummate the transactions contemplated hereby;
 
(b) The representations and warranties contained in the Credit Agreement, as
amended hereby, and the other Loan Documents are true and correct in all
material respects on and as of the date hereof as though made on and as of the
date hereof, except to the extent such representations and warranties relate to
an earlier date;
 
(c) No Event of Default under the Credit Agreement or any Loan Document has
occurred and is continuing;
 
(d) Borrower and Guarantors are in full compliance with all covenants and
agreements contained in the Credit Agreement, as amended hereby, and the other
Loan Documents to which each is a party; and
 
(e) Neither Borrower nor any Guarantor has amended any of its organizational
documents since the date of the execution of the Credit Agreement.
 
Section 4.4. Guarantors’ Consent and Ratification.  Each Guarantor hereby
consents and agrees to the terms of this Amendment, and agrees that the Guaranty
shall remain in full force and effect and shall continue to be the legal, valid
and binding obligation of such Guarantor, enforceable against such Guarantor in
accordance with its terms.  Furthermore, each Guarantor hereby agrees and
acknowledge that (a) the  Guaranty is a Loan Document, (b) the Guaranty is not
subject to any claims, defenses or offsets, (c) nothing contained in this
Amendment or any other Loan Document shall adversely affect any right or remedy
of Lender under the Guaranty, (d) the execution and delivery of this Amendment
shall in no way reduce, impair or discharge any obligations of any Guarantor
pursuant to the Guaranty and shall not constitute a waiver by Lender against any
Guarantor, (e) by virtue hereof and by virtue of the Guaranty, each Guarantor
hereby guarantees to Lender the prompt and full payment and full and faithful
performance by the Borrower of the entirety of the Guaranteed Obligations (as
defined in the Guaranty) including, without limitation, all amounts owing under
the Amended and Restated Line of Credit Note, (f) no Guarantor’s consent is
required to the effectiveness of this Amendment, and (g) no consent by any
Guarantor is required for the effectiveness of any future amendment,
modification, forbearance or other action with respect to the Credit Agreement
or any present or future Loan Document.
 
 
 

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ARTICLE V
MISCELLANEOUS
 
Section 5.1. Survival of Representations and Warranties.  All representations
and warranties made in the Credit Agreement or any other Loan Document,
including without limitation, any Loan Document furnished in connection with
this Amendment, shall survive the execution and delivery of this Amendment and
the other Loan Documents, and no investigation by Lender or any closing shall
affect such representations and warranties or the right of Lender to rely
thereon.
 
Section 5.2. Reference to Credit Agreement.  Each of the Loan Documents,
including the Credit Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Credit Agreement, as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Credit Agreement
shall mean a reference to the Credit Agreement, as amended hereby.
 
Section 5.3. Expenses of Lender.  As provided in the Credit Agreement, Borrower
agrees to pay on demand all reasonable costs and expenses incurred by Lender in
connection with the preparation, negotiation and execution of this Amendment and
the other Loan Documents executed pursuant hereto and any and all amendments,
modifications, and supplements hereto, including, without limitation, the
reasonable costs and fees of Lender’s legal counsel, and all reasonable costs
and expenses incurred by Lender in connection with the enforcement or
preservation of any rights under the Credit Agreement, as amended hereby, and
any other Loan Document, including, without limitation, the reasonable costs and
fees of Lender’s legal counsel.
 
Section 5.4. RELEASE. BORROWER AND EACH GUARANTOR HEREBY VOLUNTARILY AND
KNOWINGLY RELEASE AND FOREVER DISCHARGE LENDER, ITS DIRECTORS, OFFICERS, AGENTS,
EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS,
CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR
UNKNOWN.  ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED,
CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART
ON OR BEFORE THE DATE THIS AMENDMENT IS EXECUTED, WHICH BORROWER AND ANY
GUARANTOR MAY NOW OR HEREAFTER HAVE AGAINST LENDER, ITS DIRECTORS, OFFICERS,
AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER
ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR
OTHERWISE, AND ARISING FROM ANY LOAN, INCLUDING, WITHOUT LIMITATION, ANY
CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST
IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND
REMEDIES UNDER THE LOAN DOCUMENTS, AND NEGOTIATIONS FOR AND EXECUTION OF THE
LOAN DOCUMENTS.
 
Section 5.5. Severability.  Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
 
Section 5.6. GOVERNING LAW.  THIS AMENDMENT SHALL BE DEEMED TO HAVE BEEN MADE
AND TO BE PERFORMABLE IN AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF TEXAS.
 
 
 

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Section 5.7. Successors and Assigns.  This Amendment is binding upon and shall
inure to the benefit of the parties hereto and their respective successors,
assigns, heirs, executors, and legal representatives, except that none of the
parties hereto other than Lender may assign or transfer any of its rights or
obligations hereunder without the prior written consent of Lender.
 
Section 5.8. WAIVER OF TRIAL BY JURY.  THE PARTIES HERETO AGREE THAT NO PARTY
SHALL REQUEST A TRIAL BY JURY IN THE EVENT OF LITIGATION BETWEEN THEM CONCERNING
THE LOAN DOCUMENTS OR ANY CLAIMS OR TRANSACTIONS IN CONNECTION THEREWITH, IN
EITHER A STATE OR FEDERAL COURT, THE RIGHT TO TRIAL BY JURY BEING EXPRESSLY
WAIVED BY LENDER, BORROWER AND GUARANTORS.  EACH OF LENDER, BORROWER AND
GUARANTORS ACKNOWLEDGES THAT SUCH WAIVER IS MADE WITH FULL KNOWLEDGE AND
UNDERSTANDING OF THE NATURE OF THE RIGHTS AND BENEFITS WAIVED HEREBY, AND WITH
THE BENEFIT OF ADVICE OF COUNSEL OF ITS CHOOSING.
 
Section 5.9. Counterparts.  This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
 
Section 5.10. Descriptive Headings.  The captions in this Amendment are for
convenience only and shall not define or limit the provisions hereof.
 
Section 5.11. ENTIRE AGREEMENT.  THIS AMENDMENT, THE CREDIT AGREEMENT AND ALL
OTHER LOAN DOCUMENTS EXECUTED AND DELIVERED IN CONNECTION WITH AND PURSUANT TO
THIS AMENDMENT AND THE CREDIT AGREEMENT REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
 
Section 5.12. Arbitration.  All disputes, claims, and controversies arising from
this Amendment shall be arbitrated in accordance with Section 7.15 of the Credit
Agreement.
 
[Remainder of Page Intentionally Left Blank]
 
 
 
 
 
 

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EXECUTED as of the date first written above.
 

 
BORROWER:
     
WILHELMINA INTERNATIONAL, INC.,
 
a Delaware corporation
     
By:                                           
 
John Murray
 
Chief Financial Officer
         
LENDER:  AMEGY BANK NATIONAL ASSOCIATION,
 
a national banking association
     
By:                                           
 
Monica M. Alexander
Senior Vice President
         
GUARANTOR:
 
WILHELMINA LICENSING LLC,
 
a Delaware limited liability company
     
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
WILHELMINA FILM & TV PRODUCTIONS LLC,
 
a Delaware limited liability company
     
By:                                          
 
John Murray
Vice President and Chief Financial Officer

 
 
 

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WILHELMINA ARTIST MANAGEMENT  LLC,
 
a New York limited liability company
     
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
WILHELMINA-MIAMI, INC.,
 
a Florida corporation
     
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
WILHELMINA INTERNATIONAL, LTD.,
 
a New York corporation
     
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
WILHELMINA WEST, INC.,
 
a California corporation
         
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
WILHELMINA MODELS, INC.,
 
a New York corporation
         
By:                                          
 
John Murray
Vice President and Chief Financial Officer
         
LW1, INC.,
 
a California corporation
         
By:                                          
 
John Murray
Vice President and Chief Financial Officer

 
 

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