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               GUARANTEE & INDEMNITY - CROSS BORDER (ALL MONIES)



Dated:                                                         23 November 2000

In this deed:-

"the guarantor"            is VARI-LITE INTERNATIONAL INC. (a company having IRS
                           identification number 75-2239444) of 201 Regal Row,
                           Dallas, Texas, 75247 USA

"the company"              is BARCLAYS MERCANTILE BUSINESS FINANCE LIMITED (a
                           company registered in England, company number 898129)
                           whose registered office is at Churchill Plaza,
                           Churchill Way, Basingstoke, Hampshire, RG21 7GP

"the customer"             is VARI-LITE PRODUCTION SERVICES LIMITED (a company
                           registered in England, company number 2876045) of
                           20-22 Fairway Drive, Greenford, Middlesex UB6 8PW


1.1      In this deed the masculine includes the feminine and the neuter and the
         singular includes the plural and vice versa.

1.2      Where there are two or more guarantors for the same obligation (whether
         by this deed or otherwise) the liability of such guarantors shall be
         joint and several.

1.3      If more than one person is specified or referred to above as the
         customer, the word customer shall be construed in this deed as
         referring to and including each such person.

1.4      The headings are for ease of reference and do not affect the
         construction of this deed.

2.1      The guarantor unconditionally and irrevocably hereby undertakes to the
         company that the guarantor will within seven days of demand in writing
         made to the guarantor pay or discharge to the company all monies and
         liabilities which shall for the time being (and whether on or at any
         time after such demand) be due, owing or incurred to the company by the
         customer whether actually or contingently and whether solely or jointly
         with any other person and whether as principal or surety and including
         interest thereon, and in respect thereof to pay the legal and other
         costs and expenses of the company with value added tax (if any)
         thereon.

2.2      In addition to and without prejudice to clause 2.1 above, the guarantor
         unconditionally and irrevocably hereby undertakes to indemnify and keep
         the company indemnified against any loss or damages and the legal and
         other costs and expenses with value



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         added tax (if any) thereon suffered or incurred by the company as a
         result of the failure of the customer to meet any of its liabilities
         or perform any of its obligations to the company guaranteed hereunder.

2.3      The maximum amount ultimately enforceable under this deed shall not
         exceed Four Million Pounds ((pound)4,000,000).

3.1      This deed shall not be considered as satisfied by any intermediate
         payment or satisfaction of the whole or any part of any sum or sums of
         money due, owing or incurred to the company, but shall be a continuing
         security and shall extend to cover any sum or sums of money which shall
         for the time being be comprised in the indebtedness of the customer to
         the company hereby secured.

3.2      The guarantee and indemnity comprised in this deed shall be binding as
         a continuing security on the guarantor until the date which is 30 days
         after the company shall have received from the guarantor (or the
         executor or administrator of a deceased guarantor) notice to
         discontinue it in respect of contracts that may be entered into between
         the customer and the company after such date of discontinuance, but,
         notwithstanding such discontinuance, the guarantor shall remain liable
         under this deed in respect of all contracts entered into between the
         customer and the company dated prior to such date of discontinuance
         until all obligations under or in respect of such contracts have been
         performed.

3.3      The guarantor undertakes to give the company notice in respect of any
         customer which is a subsidiary (as defined by Section 736 of the
         Companies Act 1985 or any amendment or re-enactment thereof) of the
         guarantor forthwith on such customer ceasing to be its subsidiary.

3.4      To be validly given any notice from the guarantor to the company must
         be in writing and addressed to the company at its registered address
         stated below, marked for the attention of the company secretary.

4.       The liability hereunder of the guarantor shall be as a primary obligor
         (as between the guarantor and the company) and not merely as a surety
         and (without prejudice to the generality of the foregoing) shall not be
         impaired or discharged by reason of any time or other indulgence
         granted by the company to the customer or by reason of any arrangement
         entered into or composition agreed by the company modifying (by
         operation of law or otherwise) the rights and remedies of the company
         or of any omission on the part of the company to enforce any of its
         rights against the customer or by the withdrawal by the company of any
         facilities from the customer.

5.       The company shall be at liberty without thereby affecting its rights
         under this deed at any time and from time to time, at its absolute
         discretion, to release, discharge, compound with or otherwise vary or
         agree to vary any other securities held or to be held by the company
         for the liabilities or obligations of the customer or the liability of
         the guarantor under this deed or to make any other arrangements with
         any one or more guarantor and no such release, discharge, composition,
         variation, agreement or arrangement shall prejudice or in any way
         affect the rights and remedies of the company against any other
         guarantor.



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6.       The guarantor shall rank in any insolvency in respect of any sum paid
         hereunder by it and in respect of any other rights which may accrue
         howsoever to it in respect of any sum so paid and be entitled to
         enforce the same only after all sums hereby secured have been paid.

7.       Any security for the time being held by the guarantor from the customer
         in respect of this deed shall be held in trust for the company as
         security for the liability of the guarantor hereunder.

8.       This deed shall be in addition to any other guarantee or other security
         for the customer which the company may now or hereafter hold.

9.       For purposes of the liability of the guarantor under this deed every
         sum of money which may now be or which hereafter may become due or
         owing to the company by the customer or would have become so due or
         owing were it not for the appointment of an administrator, receiver,
         administrative receiver or liquidator of the business or assets of the
         customer or any part thereof or is deemed to become so due on such
         appointment shall be deemed to continue due and owing until actually
         paid to the company notwithstanding the intervening insolvency or
         winding up of the customer.

10.      Any money received hereunder may be placed and kept to the credit of a
         suspense account for so long as the company thinks fit without any
         obligation in the meantime to apply the same or any part thereof in or
         towards discharge of any moneys or liabilities due, owing or incurred
         by the customer to it. Notwithstanding any such payment in the event of
         any proceedings in or analogous to bankruptcy, liquidation, composition
         or arrangement the company may prove for and agree to accept any
         dividend or composition in respect of the whole or any part of such
         money and liabilities in the same manner as if this deed had not been
         executed.

11.1     The execution of this deed by any body corporate named as guarantor
         shall constitute a warranty that the execution of and performance of
         this deed is within the powers of such body corporate and constitutes
         an enforceable liability of that body corporate.

11.2     No defect in the execution of this deed by any guarantor shall affect
         the liability of any other guarantor.

12.      A certificate by the Secretary or other officer of the company as to
         the monies and liabilities for the time being due and not paid or
         discharged on first demand made by the company on the customer shall,
         in the absence of manifest error, be conclusive evidence against the
         guarantor and the customer in any legal proceedings.

13.1     If under any applicable law and whether pursuant to a judgement being
         made or registered against the guarantor or for any other reason, any
         payment under or in connection with this deed is made or falls to be
         satisfied in a currency (the "other currency") other than sterling,
         then to the extent that the payment (when converted into sterling at
         the rate of exchange on the date of payment or, if it is not
         practicable for the company to purchase sterling with the other
         currency on the date of payment, at the rate of exchange as soon
         thereafter as it is practicable for the company to do so



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         or, in the case of the guarantor's liquidation, bankruptcy or
         analogous process at the rate of exchange on the latest date permitted
         by applicable law for the determination of liabilities in such
         liquidation, bankruptcy or analogous process) actually received by the
         company falls short of the amount due under the terms of this deed the
         guarantor shall, as a separate and independent obligation, indemnify
         and hold the company harmless against the amount of such shortfall.

13.2     For the purpose of this clause "rate of exchange" means the rate at
         which the company is able on the relevant date to purchase sterling
         with the other currency, and shall take into account any premium and
         other costs of exchange.

14.      All payments hereunder shall be made without set-off or counter-claim
         and free and clear of and without deduction or withholding for or on
         account of any present or future taxes, levies, imposts, duties or
         other charges of any nature whatsoever. If the guarantor should be
         compelled by law to deduct or withhold such taxes, it shall pay such
         additional amounts to the company as may be necessary in order that the
         actual amount received by the company after deduction or withholding
         (and after deduction of an amount equal to any additional taxes or
         other charges required to be deducted or withheld as a consequence of
         the payment of such additional amount) shall equal the amount that
         would have been received if such deduction or withholding were not
         required. If the guarantor shall make any deduction or withholding from
         any amount paid hereunder, it shall upon request forthwith supply the
         company with official receipts or other evidence acceptable to the
         company establishing payment of such deducted or withheld amounts by
         the guarantor to the appropriate taxing or other authority.

15.      Each provision in this deed shall be construed as a separate provision
         and, if part or the entirety of any provision is held by any court of
         competent jurisdiction to be unenforceable or unenforceable in respect
         of one or more of several customers, such unenforceability shall have
         no effect upon and shall not impair the validity, enforceability or
         legality of the remaining parts of such provision or of any other
         provision contained in this deed or its validity, enforceability or
         legality in respect of any other customer.

16.1     This deed shall be governed by and construed in accordance with the law
         of England.

16.2     The guarantor hereby submits to the non-exclusive jurisdiction of the
         High Court of Justice in London and, without prejudice to the
         generality of the foregoing, agrees that the company may take
         proceedings against the guarantor in any jurisdiction it considers fit.

16.3     The taking of proceedings in any one jurisdiction shall not preclude
         the taking of proceedings in any other jurisdiction whether
         concurrently or not.

16.4     The guarantor waives any objection which it may have now or at any time
         in the future to the taking of proceedings in any jurisdiction or that
         such proceedings are brought in an inconvenient forum.

17.      The guarantor hereby appoint the customer to be the guarantor's agent
         to accept on the



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         guarantor's behalf any demand under this deed or service of
         proceedings commenced in England and will at all times maintain an
         agent in England to accept service of demands and/or proceedings on
         the guarantor's behalf.

IN WITNESS whereof this deed was entered into the day and year first before
written.

EITHER

The Common Seal of
Vari-Lite International Inc
has been affixed to this deed
in the presence of:-


Director


Secretary


                                                   -----------------------------
                                                    Signature(s) confirmed by


OR

Signed by............................


and ................................. for and on
behalf of Vari-Lite International Inc


pursuant to a resolution of the Board of
Directors (a certified copy of which is
annexed hereto)


I/we/each of us hereby acknowledge(s) receipt of a copy of the above guarantee.



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