Document:

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                                                                  Exhibit 10.3

                             EMPLOYMENT AGREEMENT

                             ANTEX BIOLOGICS INC.

               THIS EMPLOYMENT AGREEMENT (the "Agreement"), made as of JANUARY
1, 2001 is entered into by Antex Biologics Inc., a Delaware corporation with
its principal place of business at 300 Professional Drive, Gaithersburg,
Maryland  20879 (the "Company"), and V. M. Esposito, Ph.D., residing at 9404
Tobin Circle, Potomac, Maryland  20854 (the "Employee").

                                 WITNESSETH:

               WHEREAS, the Company desires to employ the Employee, and the
Employee desires to be employed by the Company;

               NOW THEREFORE, in consideration of the mutual covenants and
promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties
hereto, the parties agree as follows:

               1.     Term of Employment. The Company hereby agrees to employ
the Employee, and the Employee hereby accepts employment with the Company,
upon the terms set forth in this Agreement, for the period commencing on
JANUARY 1, 2001 (the "Commencement Date") and ending on DECEMBER 31, 2005
(such period, as it may be extended, the "Employment Period"), unless sooner
terminated in accordance with the provisions of Section 4 hereof. Upon the
fifth anniversary of the Commencement Date and upon every fifth anniversary of
the Commencement Date thereafter, the term of the Employment Period shall be
extended automatically for five (5) additional years unless, at least three
(3) years prior to such anniversary, the Company shall have delivered to the
Employee or, at least six (6) months prior to such anniversary, the Employee
shall have delivered to the Company, written notice that the term of the
Employee's employment hereunder will not be extended.

               2.     Title; Capacity. The Employee shall serve as Chairman of
the Board of Directors and Chief Executive Officer or in such other position
as the Company or its Board of Directors (the "Board") may determine from time
to time is reasonable. The Employee shall be based at the Company's
headquarters in Gaithersburg, Maryland, or such place or places in the
continental United States as the Board shall determine, and is reasonable and
acceptable to the employee. The Employee shall be subject to the supervision
of, and shall have such authority as is delegated to him by the Board.

               The Employee hereby accepts such employment and agrees to
undertake the duties and responsibilities inherent in such position and such
other duties and responsibilities as the Board or its designee shall from time
to time reasonably assign to him. The Employee agrees to devote substantially
all of his entire business time, attention and energies to the business and
interests of the Company during the Employment Period. He shall not engage in
any other business activity, except as may be approved by the Company;
provided, however, that nothing herein shall be construed as preventing the
Employee from serving on the board of directors of

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any company, mentoring or consulting, subject to the prohibitions set forth in
Section 6(a) hereof. The Employee agrees to abide by the rules, regulations,
instructions, personnel practices and policies of the Company and any changes
therein which may be adopted from time to time by the Company. The Employee
acknowledges receipt of copies of all such rules and policies committed to
writing as of the date of this Agreement.

               3.     Compensation and Benefits.

                      3.1    Salary.  The Company shall pay the Employee, in
semi-monthly installments on the 15th and month-end or on the last working day
of such month, an annual base salary (the "Annual Base Salary") of FOUR
HUNDRED THOUSAND ($400,000) for the period commencing on the Commencement
Date. Thereafter, upon each anniversary of the Commencement Date (including
the first anniversary thereof), following an annual review by the Board, the
Board may adjust the Employee's Annual Base Salary as it determines in its
sole discretion; provided, however, that the Board of Directors shall not
reduce the Annual Base Salary.

                      3.2    Fringe Benefits.  The Employee shall be entitled
to participate in all bonus, stock option, benefit and insurance programs that
the Company establishes and makes available to its employees, if any, to the
extent that Employee's position, tenure, salary, age, health and other
qualifications make him eligible to participate, including, but not limited
to, the programs indicated on Schedule A of this Agreement. The Employee shall
be entitled to thirty (30) days paid vacation per year, to be taken at such
times as may be approved by the Board or its designee.

                      3.3    Reimbursement of Expenses.  The Company shall
reimburse the Employee for all reasonable travel, entertainment and other
expenses incurred or paid by the Employee in connection with, or related to,
the performance of his duties, responsibilities or services under this
Agreement, upon presentation by the Employee of documentation, expense
statements, vouchers and/or such other supporting information as the Company
may request; provided, however, that the amount available for such travel,
entertainment and other expenses may be fixed in advance by the Board.

                      3.4    Keyman Insurance.  The Company and the Employee
hereby agree that, subject to the insurability of the Employee, the Company
shall apply for and procure in the name of the employee for the Company's own
benefit keyman life insurance in any amount or amounts considered advisable
but not less than Two Million dollars ($2,000,000) and that Employee shall
have no right, title or interest therein. The Employee agrees to submit to any
medical or other examination and to execute and deliver any application or
other instrument necessary to effectuate such life insurance.

                      3.5    Bonus.  The Company shall, subject to approval of
the Board, pay to the Employee an appropriate bonus (the "Bonus") with respect
to each completed year of employment. The Bonus shall be paid to Employee in
one lump sum on or prior to January 31 of each year for the one-year period of
employment, or portion thereof, ending on the preceding December 31.

               4.     Employment Termination.  The employment of the Employee
by the

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Company pursuant to this Agreement shall terminate upon the occurrence of any
of the following:

                      4.1    Expiration of the Employment Period in accordance
with Section 1 hereof, and if the term is not extended in accordance with
Section 1 hereof, then the provisions of Section 4.4 hereof shall apply;

                      4.2    At the election of the Company, for cause,
immediately upon written notice by the Company to the Employee. For the
purposes of this Section 4.2, cause for termination shall be deemed to exist
upon (a) a good faith finding by the Company of failure of the Employee to
adequately perform his assigned duties for the Company, dishonesty, gross
negligence or misconduct, or (b) the conviction of the Employee of, or the
entry of a pleading of guilty or nolo contendere by the Employee to, any crime
involving moral turpitude or any felony;

                      4.3    One year (365 days) after the death or the
disability of the Employee. As used in this Agreement, the term "disability"
shall mean the inability of the Employee, due to a physical or mental
disability, for a period of ninety (90) days, whether or not consecutive,
during any three hundred sixty (360)-day period to perform the services
contemplated under this Agreement. A determination of disability shall be made
by a physician satisfactory to both the Employee and the Company, provided
that if the Employee and the Company do not agree on a physician, the Employee
and the Company shall each select a physician and these two together shall
select a third physician, whose determination as to disability shall be
binding on all parties;

                      4.4    At the election of the Company, upon not less
than thirty-six (36) months' prior written notice of termination to the
Employee. At the option of the Company and in lieu of such notice, the Company
may pay to Employee an amount equal to (i) thirty-six (36) months' salary
computed on the basis of the then current Annual Base Salary or the total
amount of salary that would be payable for the remainder of the Employment
Period, which ever is the greater plus (ii) any bonus to which Employee is
entitled (the "Severance Amount"). If the Company elects to pay Severance
Amount in lieu of notice it shall, at the expense of the Company, continue
Employee's participation in all benefits programs including but not limited to
medical, dental and life insurance programs provided by the Company to the
Employee under Section 3.2 hereof on the date on which such amount is paid
(the "Payment Date") until the later of a date thirty-six (36) months after
the Payment Date or the termination of the Employment Period. Acceleration of
stock options and modifications to the exercise period will be in accordance
with the Company's Amended and Restated Stock Option Plan. However, if the
Employee is terminated for other than cause, the stock options will become
fully vested and exercisable until the expiration date of the options or for a
minimum of two years after the Payment Date or termination of the Employment
Period, whichever of the three dates is the greater. In the event that any
payment under this Agreement constitutes an excess parachute payment under
Section 280G of the Internal Revenue Code, the Employee will be entitled to
additional gross-up payments such that the net amount retained by the Employee
after deduction of any excise taxes and all other taxes on the gross-up
payments shall be equal to the net amount that would have been retained from
the initial payments under the Agreement.

                      4.5    At the election of the Employee, for good reason,
immediately upon written notice of termination to the Company. For the
purposes of this Section 4.5, good

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reason for termination shall be deemed to exist upon an assignment to the
Employee of duties which are inconsistent with the Employee's status as a
senior executive officer of the Company or are a substantial reduction in the
nature of the Employee's responsibilities; a material reduction in the
Employee's benefits unless all other employees entitled to such benefits incur
proportionate reductions; or any breach by the Company of any of its
obligations hereunder. In the event that the Employee terminates his
employment for good reason the Employee shall be entitled to the payments and
benefits stated in Section 4.4.

                      4.6    At the election of the Employee, for any reason
other than good reason, upon not less than six (6) months prior written notice
of termination to the Company.

               5.     Effect of Termination.

                      5.1    Termination for Cause or at Election of Employee.
In the event the Employee's employment is terminated for cause pursuant to
Section 4.2 hereof, or at the election of the Employee pursuant to Section 4.6
hereof, the Company shall pay to the Employee the compensation and benefits
otherwise payable to him under Section 3 and 4 hereof through the last day of
his actual employment by the Company.

                      5.2    Termination for Death or Disability.  In the
event the Employee's employment is terminated by death or because of
disability pursuant to Section 4.3 hereof, the Company shall pay to the estate
of the Employee or to the Employee, as the case may be, the compensation which
would otherwise be payable to the Employee up to the end of the month in which
the termination of his employment because of death or disability occurs.

                      5.3    Survival.  The provisions of Sections 6 and 7
hereof shall survive the termination of this Agreement.

               6.     Non-Competition.

                      (a)    For a period of two (2) years after the
termination or expiration of Employee's employment herender, thereof, the
Employee will not directly or indirectly:

                             (i)    as an individual proprietor, partner,
        stockholder, officer, employee, director, joint venturer, investor,
        lender, or in any other capacity whatsoever (other than as the holder
        of not more than one percent (1%) of the total outstanding stock of a
        publicly held company), engage in the business of developing,
        producing, marketing or selling products of the kind or type developed
        or being developed, produced, marketed or sold by the Company while
        the Employee was employed by the Company; or

                             (ii)   recruit, solicit, or induce, or attempt to
        induce, any employee or employees of the Company to terminate their
        employment with, or otherwise cease their relationship with, the
        Company; or

                             (iii)  solicit, divert or take away, or attempt
        to divert or to take away, the business or patronage of any of the
        clients, customers or accounts, or prospective clients, customers or
        accounts, of the Company which were

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        contacted, solicited or served by the Employee while employed by the
        Company.

                      (b)    If any restriction set forth in this Section 6 is
found by any court of competent jurisdiction to be unenforceable because it
extends for too long a period of time or over too great a range of activities
or in too broad a geographic area, it shall be interpreted to extend only over
the maximum period of time, range of activities or geographic area as to which
it may be enforceable.

                      (c)    The restrictions contained in this Section 6 are
necessary for the protection of the business and goodwill of the Company and
are considered by the Employee to be reasonable for such purpose. The Employee
agrees that any breach of this Section 6 will cause the Company substantial
and irrevocable damage and therefore, in the event of any such breach, in
addition to such other remedies which may be available, the Company shall have
the right to seek specific performance and injunctive relief.

                      (d)    The Company and the Employee acknowledge and
agree that ten percent (10%) of the Annual Base Salary paid pursuant to
Section 3.1 shall be allocated as consideration for the Employee's agreement,
pursuant to this Section 6, not to compete with the Company. In the event that
the Company elects to pay the Severance Amount in lieu of notice as described
in Section 4.4, the Company and the Employee acknowledge and agree that ten
percent (10%) of the amount equal to thirty-six months' salary shall be
allocated as consideration for the Employee's agreement, pursuant to this
Section 6, not to compete with the Company.

               7.     Proprietary Information and Development.

                      7.1    Proprietary Information.

                      (a)    Employee agrees that all information and
know-how, whether or not in writing, or a private, secret or confidential
nature concerning the Company's business or financial affairs (collectively,
"Proprietary Information") is and shall be the exclusive property of the
Company. By way of illustration, but not limitation, Proprietary Information
may include inventions, products, processes, methods, techniques, formulas,
compositions, compounds, projects, developments, plans, research data,
clinical data, financial data, personnel data, computer programs, and customer
and supplier lists. Employee will not disclose any Proprietary Information to
others outside the Company or use the same for any unauthorized purposes
without written approval by an officer of the Company, either during or after
his employment, unless and until such Proprietary Information has become
public knowledge without fault by the Employee.

                      (b)    Employee agrees that all files, letters,
memoranda, reports, records, data, sketches, drawings, laboratory notebooks,
program listings, or other written, photographic, or other tangible material
containing Proprietary Information, whether created by the Employee or others,
which shall come into his custody or possession, shall be and are the
exclusive property of the Company to be used by the Employee only in the
performance of his duties for the Company.

                      (c)    Employee agrees that his obligation not to
disclose or use information, know-how and records of the types set forth in
paragraphs (a) and (b) above, also

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extends to such types of information, know-how, records and tangible property
of customers of the Company or suppliers to the Company or other third parties
who may have disclosed or entrusted the same to the Company or to the Employee
in the course of the Company's business.

                      7.2    Developments.

                      (a)    Employee will make full and prompt disclosure to
the Company of all inventions, improvements, discoveries, methods,
developments, software, and works of authorship, whether patentable or not,
which are created, made, conceived or reduced to practice by the Employee or
under his direction or jointly with others during his employment by the
Company, whether or not during normal working hours or on the premises of the
Company (all of which are collectively referred to in this Agreement as
"Developments").

                      (b)    Employee agrees to assign and does hereby assign
to the Company (or any person or entity designated by the Company) all his
right, title and interest in and to all Developments and all related patents,
patent applications, copyrights and copyright applications. However, this
Section 7.2 (b) shall not apply to Developments which do not relate to the
present or planned business or research and development of the Company and
which are made and conceived by the Employee not during normal working hours,
not on the Company's premises and not using the Company's tools, devices,
equipment or Proprietary Information.

                      (c)    Employee agrees to cooperate fully with the
Company, both during and after his employment with the Company, with respect
to the procurement, maintenance and enforcement of copyrights and patents
(both in the United States and foreign countries) relating to Developments.
Employee shall sign all papers, including, without limitation, copyright
applications, patent applications, declarations, oaths, formal assignments,
assignment of priority rights, and powers of attorney, which the Company may
deem necessary or desirable in order to protect its rights and interests in
any Development.

                      7.3    Other Agreements.  Employee hereby represents
that he is not bound by the terms of any agreement with any previous employer
or other party to refrain from using or disclosing any trade secret or
confidential or proprietary information in the course of his employment with
the Company or to refrain from competing, directly or indirectly, with the
business of such previous employer or any other party. Employee further
represents that his performance of all terms of this Agreement and as an
employee of the Company does not and will not breach any agreement to keep in
confidence proprietary information, knowledge or data acquired by him in
confidence or in trust prior to his employment with the Company.

               8.     Prior Agreements. This Agreement supersedes an
Employment Agreement dated as of January 1, 1996 by and between the Company
and Employee (the "Prior Agreement") and, as of the date hereof, the Prior
Agreement shall be of no further force and effect.

               9.     Notices. All notices required or permitted under this
Agreement shall be in writing and shall be deemed effective upon personal
delivery or upon deposit in the United States Post Office, by registered or
certified mail, postage prepaid, addressed to the other party at the address
shown above, or at such other address or addresses as either party shall
designate to the other in accordance with this Section 9.

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               10.    Pronouns.  Whenever the context may require, any
pronouns used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular forms of nouns and pronouns shall
include the plural, and vice versa.

               11.    Entire Agreement.  This Agreement constitutes the entire
agreement between the parties and supersedes all prior agreements and
understandings, whether written or oral, relating to the subject matter of
this Agreement.

               12.    Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company and the Employee.

               13.    Governing Law.  This Agreement shall be construed,
interpreted and enforced in accordance with the laws of the State of Maryland.

               14.    Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of both parties and their respective successors
and assigns, including any corporation with which or into which the Company
may be merged or which may succeed to its assets or business, provided,
however, that the obligations of the Employee are personal and shall not be
assigned by him.

               15.    Miscellaneous.

                      15.1   No delay or omission by the Company in exercising
any right under this Agreement shall operate as a waiver of that or any other
right. A waiver or consent given by the Company on any one occasion shall be
effective only in that instance and shall not be construed as a bar or waiver
of any right on any other occasion.

                      15.2    The captions of the sections of this Agreement
are for convenience of reference only and in no way define, limit of affect
the scope or substance of any section of this Agreement.

                      15.3   In case any provision of this Agreement shall be
invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected or
impaired thereby.

               IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year set forth above. ANTEX BIOLOGICS INC.

                                            by      /s/Donald G. Stark
                                                  ----------------------
                                                   Donald G. Stark
                                                   Director and Chairman of the
                                                   Compensation Committee

                                            Employee
                                                     /s/V. M. Esposito
                                                   ----------------------
                                                   V. M. Esposito

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                                  SCHEDULE A

                      COMPANY BONUS AND BENEFIT PROGRAMS

Health  Insurance
        Medical
        Dental

Life Insurance

Long Term Disability

401(k) Saving Plan

Employee Stock Option Plans

Bonus Plan

Deferred Compensation Plan

Executive Split-dollar Planex10-45

EX 10.45

AMENDMENT AND WAIVER

      AMENDMENT NO. 4 and WAIVER NO. 1, dated as of November 2, 2000, to and
under the Second Amended and Restated Credit Agreement, dated as of October 28,
1999, by and among Global Vacation Group, Inc., the Lenders party thereto, and
The Bank of New York, as Administrative Agent (as amended, supplemented or
otherwise modified, the “Credit Agreement”), AMENDMENT NO. 2, dated as of the
date hereof, to the Security Agreement (as defined in the Credit Agreement),
and AMENDMENT NO. 1, dated as of the date hereof, to the Subsidiary Guarantee
(as defined in the Credit Agreement) (collectively, this “Amendment”).

RECITALS

      A. Unless the context otherwise requires, capitalized terms used herein
and not defined herein shall have the meanings assigned to such terms in the
Credit Agreement.

      B. The Loan Parties have requested that the Administrative Agent agree to
certain modifications to the Credit Agreement, the Security Agreement and the
Subsidiary Guarantee upon the terms and conditions contained herein, and the
Administrative Agent is willing so to agree.

      Accordingly, in consideration of the Recitals and the covenants,
conditions and agreements hereinafter set forth, and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Loan Parties and the Administrative Agent hereby agree as
follows:

      1. Section 1.1 of the Credit Agreement is hereby amended as follows:

		
	 	      (a) Each of the definitions of the terms “Cash Collateral”, “Cash
Collateral Account” and “Scheduled Reduction Date” is deleted in its
entirety.

		
	 	      (b) The table contained in clause (b) of the definition of the term
“Applicable Margin” is hereby amended by increasing by 0.250% each of the
percentage entries contained in such table under the headings “ABR
Margin” and “Eurodollar and LC Fee Margin”.

		
	 	      (c) The definition of the term “Fixed Charges” is amended by (i)
adding the words “as in effect immediately prior to the Amendment No. 4
Effective Date” immediately after the reference “Section 2.4(b)(vii)” and
immediately after the reference “Section 2.3(c)” and (ii) deleting the
last sentence of such definition.

		
	 	      (d) The following new definitions are added in their appropriate
alphabetical order:

 

		
	 	      ““Amendment No. 4 Effective Date” means the date on which
Amendment No. 4 to the Credit Agreement becomes effective.

		
	 	      “BofA Account” means the Securities Accounts maintained at Bank
of America, N.A. on the Amendment No. 4 Effective Date that is subject
to a Control Agreement (Account Number: 72-40-400-0216481).

		
	 	      “Borrowing Base” means, at any time, an amount equal to 75% of
the aggregate of all Receivables, in each case which Receivable (A) is
payable in Dollars, (B) constitutes a good and valid account
representing an undisputed bona fide indebtedness incurred by the
relevant account debtor for a fixed sum as set forth in the invoice
relating thereto with respect to an absolute sale and delivery upon
the stated terms of services rendered and (C) is and at all times
shall continue to be acceptable to the Administrative Agent in all
respects in accordance with its reasonable credit judgment (provided
that the Administrative Agent shall provide the Borrower and the
Lenders with five Business Days’ prior notice of any determination
under this clause (C) that a Receivable is unacceptable). Standards
of eligibility may be established and revised from time to time (upon
five Business Days’ prior notice to the Lenders and the Borrower) by
the Administrative Agent in its reasonable credit judgment; provided,
however, that notwithstanding anything in any Loan Document to the
contrary, for purposes hereof, the term “Borrowing Base” shall not
include:

		
	 	            (a) Receivables owing by Wingate Travel;

		
	 	            (b) Receivables that remain unpaid more than 60 days after the
original date of the applicable invoice;

		
	 	            (c) Receivables owing by a single account debtor if greater than
50% of the balance owing by such account debtor remains unpaid more
than 60 days after the original date of the applicable invoice;

		
	 	            (d) Receivables with respect to which the account debtor is a
director, officer, employee, subsidiary or other affiliate of the
Borrower or any Subsidiary;

		
	 	            (e) Receivables with respect to which the account debtor has (i)
disputed such receivable or asserted a counterclaim or any other claim
or defense or (ii) a right of set-off, but only to the extent of such
counterclaim or set-off;

		
	 	            (f) Receivables with respect to which the account debtor is the
subject of bankruptcy or a similar insolvency proceeding or has made
an assignment for the benefit of creditors or whose assets have been
conveyed to a receiver or trustee;

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	 	            (g) Receivables with respect to which the account debtor’s
obligation to pay is conditional upon the account debtor’s approval or
is otherwise subject to any repurchase obligation or return right;
	 
	 	            (h) Receivables not subject to a fully perfected first priority
security interest in favor of the Secured Parties or subject to any
security interest or Lien in favor of any Person other than the Lien
of the Secured Parties;

		
	 	            (i) Receivables, the account debtor of which is a Governmental
Authority;

		
	 	            (j) Receivables with respect to which the account debtor’s
obligation does not constitute its legal, valid and binding
obligation, enforceable against it in accordance with its terms;

		
	 	            (k) Receivables with respect to which the Borrower has not yet
performed the applicable service; and

		
	 	            (l) Receivables which the Administrative Agent, exercising
reasonable discretion, has determined to be unacceptable, provided
that, for purposes of Section 2.4(b)(viii), the Administrative Agent
shall provide the Borrower and the Lenders with five Business Days’
prior notice of such determination.

		
	 	      “LC Collateral Base” means, at any time, an amount equal to the
aggregate of all cash and cash equivalents of the Borrower and the
Subsidiaries (determined on a consolidated basis in accordance with
GAAP) on deposit at such time in the BofA Account, provided, however,
that notwithstanding anything in any Loan Document to the contrary,
for purposes hereof, the term “LC Collateral Base” shall not include
any cash or cash equivalent not subject to a fully perfected first
priority security interest in favor of the Secured Parties or subject
to any security interest or Lien in favor of any Person other than the
Lien of the Secured Parties.

		
	 	      “Receivable” means any right to payment arising as a result of,
or in connection with, a sale of inventory or the performance of
services by, and in the ordinary course of business of, the Borrower’s
“Allied Tours” division.

		
	 	      “Total Available Cash” means, at any time, an amount (which shall
not be negative) equal to (i) the aggregate amount at such time of all
cash and cash equivalents of the Borrower and the Subsidiaries
(determined on a consolidated basis in accordance with GAAP) minus
(ii) the sum of, without duplication, each of the following with
respect to the Borrower and the Subsidiaries, to the extent utilized
in determining the aggregate amount at such time of such cash and cash
equivalents: (a) the lesser of (A) the LC Collateral Base and (B) an
amount equal to 103% of the LC Exposure, (b) the aggregate amount of
all cash and cash equivalents subject to Liens permitted by Section
8.2(e), (c) the aggregate amount of all Customer Deposit

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	 	Property (as
defined in the Security Agreement) that does not constitute
Collateral, (d) the aggregate amount of all self-insurance reserves
set aside in respect of employee medical plans, (e) the aggregate
amount of all 401K deposits that have not yet been
deposited with or transferred to the relevant trustee or custodian,
and (f) the aggregate amount of all funds set aside to cover checks
drawn for routine working capital purposes in the ordinary course of
business.”

      2. The third sentence of Section 2.1 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:

		
	 	“Subject to the terms and conditions hereof, each Lender severally
agrees to make revolving credit loans in Dollars (each, together with
a converted Acquisition Loan referred to in the previous sentence, a
“Revolving Loan” and, as the context may require, collectively with
all other Revolving Loans of such Lender and with the Revolving Loans
of all other Lenders, the “Revolving Loans”) to the Borrower from time
to time on any Business Day during the period from the Second
Restatement Date to the Commitment Termination Date, provided that,
after giving effect thereto, (i) such Lender’s Revolving Exposure
would not exceed such Lender’s Revolving Commitment, (ii) the
Aggregate Revolving Exposure would not exceed an amount equal to the
Aggregate Revolving Commitment minus the aggregate face amount of all
outstanding letters of credit obtained pursuant to Section 8.1(i),
(iii) the aggregate outstanding principal balance of the Revolving
Loans would not exceed the Borrowing Base, (iv) in the case of any
Revolving Loans requested on any Borrowing Date occurring on or before
December 31, 2000, the aggregate outstanding principal balance of such
requested Revolving Loans would not exceed an amount equal to
$5,000,000 minus Total Available Cash immediately prior to such
requested Revolving Loans, and (v) in the case of any Revolving Loans
requested on any Borrowing Date occurring after January 1, 2001, Total
Available Cash (excluding the proceeds of such requested Revolving
Loans) would be less than $5,000,000”.

      3. Section 2.3 of the Credit Agreement is hereby amended as follows:

		
	 	      (a) Subsection (c) is amended and restated in its entirety to read
as follows:

		
	 	      “(c) Scheduled Reductions of the Aggregate Revolving Commitment.
The Aggregate Revolving Commitment shall be permanently reduced to (i)
$17,500,000 on the Amendment No. 4 Effective Date and (ii) $15,000,000
on March 31, 2001.”

		
	 	      (b) The proviso contained in subsection (d) is deleted in its
entirety.

      4. Section 2.4(b) of the Credit Agreement is hereby amended as follows:

		
	 	      (a) The proviso contained in clause (vii) is deleted in its
entirety.

		
	 	      (b) The following new clauses (viii), (ix) and (x) are added:

-4-

		
	 	      “(viii) within two Business Days after any day on which the
aggregate outstanding principal balance of the Revolving Loans exceeds
the Borrowing Base, by an amount sufficient to eliminate such excess;

		
	 	      (ix) on Thursday of each week, if Total Available Cash exceeds
$5,000,000, by an amount equal to the lesser of (A) such excess and
(B) the aggregate outstanding principal balance of the Revolving Loans
(and, in the event that any Revolving Loan is outstanding on such day,
the Borrower shall furnish to the Administrative Agent and each Lender
a certificate of a Financial Officer of the Borrower, in form and
substance satisfactory to the Administrative Agent, setting forth a
reasonably detailed calculation of Total Available Cash as of such
day); and

		
	 	      (x) on any day on or after January 1, 2001 on which the Borrower
or any Subsidiary receives a payment in respect of any Receivable, by
an amount equal to the amount of such payment, provided that,
notwithstanding anything to the contrary in any Loan Document, (A) at
all times on and after the Amendment No. 4 Effective Date, all such
payments shall be collected into the account at BNY maintained by the
Borrower for such purpose on the Amendment No. 4 Effective Date
(Account Number: 0000167762) and (B) at all times on and after January
1, 2001, each such payment shall be collected and, on the day on which
the funds constituting such payment become available, applied to the
outstanding principal balance of the Revolving Loans as required by
this clause (x) directly by BNY (and, until so applied, all funds and
other property constituting such payment shall at all times be subject
to a fully perfected first priority security interest in favor of the
Secured Parties), in each case under subclauses (A) and (B) of this
proviso in a manner in all respects reasonably satisfactory to the
Administrative Agent.”

      5. Section 2.4(c) of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:

		
	 	      “(c) If on any day the LC Collateral Base is less than an amount
equal to 103% of the Letter of Credit Exposure of all Lenders, then
the Borrower shall, within two Business Days after such day, deposit
or cause to be deposited into the BofA Account cash and/or cash
equivalents in an amount sufficient to eliminate such deficiency.”

      6. Section 2.5(a) of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:

		
	 	      “(a) Availability; Procedure. The Borrower may request the Issuer
to issue standby letters of credit (the “Letters of Credit”; each,
individually, a “Letter of Credit”) during the period from the Second
Restatement Date to the tenth Business Day prior to the Maturity Date,
provided that (i) immediately after the issuance of each Letter of
Credit, the Letter of Credit Exposure of all Lenders would not exceed
an amount equal to the Letter of Credit Commitment minus the aggregate
face

-5-

		
	 	amount of all outstanding letters of credit obtained pursuant to
Section 8.1(i), (ii) the
Aggregate Revolving Exposure would not exceed the Aggregate Revolving
Commitment, and (iii) the LC Collateral Base would equal or exceed an
amount equal to 103% of the Letter of Credit Exposure of all Lenders.
To request the issuance of a Letter of Credit, the Borrower shall
notify the Administrative Agent and the Issuer by the delivery of a
Credit Request, which shall be sent by facsimile and shall be
irrevocable (confirmed promptly, and in any event within five Business
Days, by the delivery to the Administrative Agent of a Credit Request
manually signed by the Borrower), at least three Business Days prior
to the requested date of issuance, specifying (A) the beneficiary of
such Letter of Credit, (B) the Borrower’s proposal as to the
conditions under which a drawing may be made under such Letter of
Credit and the documentation to be required in respect thereof, (C)
the maximum amount to be available under such Letter of Credit, and
(D) the requested dates of issuance and expiration. Such Credit
Request shall be accompanied by (1) a duly completed application for
such Letter of Credit on such forms as may be made available from time
to time by the Issuer and such other certificates, documents
(including a reimbursement agreement) and other information as may be
required by the Issuer in accordance with its customary procedures
(collectively, the “Letter of Credit Documentation”) and (2) a
certificate of a Financial Officer of the Borrower, in form and
substance satisfactory to the Administrative Agent, setting forth (x)
a reasonably detailed calculation of the LC Collateral Base on a pro
forma basis immediately after giving effect to such Letter of Credit
and (y) information of the type referred to in subclauses (A) through
(D) of the immediately preceding sentence with respect to each
outstanding letter of credit obtained pursuant to Section 8.1(i). Upon
receipt of such Credit Request from the Borrower, the Administrative
Agent shall promptly notify each Lender thereof. Subject to the
satisfaction of the terms and conditions of this Agreement, the Issuer
shall issue each requested Letter of Credit. In the event of any
conflict between the provisions of this Agreement and any Letter of
Credit Documentation, the provisions of this Agreement shall control.”

      7. Section 2.7 of the Credit Agreement is hereby deleted in its entirety.

      8. Section 6.2 of the Credit Agreement is hereby amended and restated in
its entirety to read as follows:

		
	 	      “Section 6.2. Credit Request and Other Documentation

		
	 	            With respect to each Extension of Credit, the Administrative
Agent shall have received (i) a Credit Request, executed by a duly
authorized officer of the Borrower, (ii) in the case of a Revolving
Loan, a certificate of a Financial Officer of the Borrower, in form
and substance satisfactory to the Administrative Agent, setting forth
(a) reasonably detailed calculations of the Borrowing Base and Total
Available Cash, in each case on a pro forma basis immediately after
giving effect to such Revolving Loan, and (b) information of the type
referred to in Sections 2.5(a)(A) through (D) with respect to each
outstanding letter of credit obtained pursuant to

-6-

		
	 	Section 8.1(i), and
(iii) in the case of a Letter of Credit, all other documentation
required by Section 2.5(a).”

      9. Each of the preambles to Articles 7 and 8 of the Credit Agreement is
hereby amended by adding the words “and all Letters of Credit shall have
expired” immediately after the word “full” where it appears therein.

      10. Section 7.1 of the Credit Agreement is hereby amended as follows:

		
	 	      (a) Subsection (f) is amended and restated in its entirety to read
as follows:

		
	 	      “(f) no later than 30 days after the last day of each month, a
copy of its consolidating balance sheets and related statements of
income and cash flows as of the end of and for such month and, no
later than 45 days after the last day of each fiscal quarter, a copy
of projections of its consolidating balance sheets and related
statements of income and cash flows on a quarterly basis through
December 31, 2001, in each case under this clause (f) in a format
reasonably satisfactory to each Lender;

		
	 	      (b) Subsection (j) is redesignated as subsection (k) and the
following new subsection (j) is added:

		
	 	      “(j) no later than 10 Business Days after the last day of each
month, a certificate of a Financial Officer of the Borrower, in form
and substance satisfactory to the Administrative Agent, setting forth
(i) reasonably detailed calculations of the Borrowing Base, Total
Available Cash and the LC Collateral Base and (ii) information of the
type referred to in subclauses (A) through (D) of Section 2.5(a) with
respect to each outstanding letter of credit obtained pursuant to
Section 8.1(i); and”.

      11. Section 8.1 of the Credit Agreement is hereby amended by adding the
following new subsection (i):

		
	 	      “(i) Indebtedness in respect of letters of credit obtained in the
ordinary course of business, provided that, immediately after giving
effect to each such letter of credit or any increase in the face
amount of any such letter of credit, (i) the aggregate face amount of
all such letters of credit outstanding plus the Letter of Credit
Exposure of all Lenders shall not exceed the Letter of Credit
Commitment and (ii) the aggregate face amount of all such letters of
credit outstanding plus the Aggregate Revolving Exposure shall not
exceed the Aggregate Revolving Commitment.”

      12. Section 8.2 of the Credit Agreement is hereby amended by adding the
following new subsection (e):

		
	 	      “(e) Liens securing Indebtedness permitted by Section 8.1(i)
(and, in each case, notwithstanding anything to the contrary in any
Loan Document, all security interests, if any, in favor of the Secured
Parties in or to the property or assets

-7-

		
	 	subject to such Lien shall
automatically be released), provided that (i) immediately before and
after giving effect to each such Lien (or the attachment thereof to
any
property or asset), no Default shall or would exist and (ii) no such
Lien shall at any time apply or attach to any property or asset then
included for purposes of the LC Collateral Base.”

      13. Section 8.7(c) of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:

		
	 	      “(c) the Borrower may declare and pay cash dividends on preferred
stock, convertible preferred stock or similar securities issued in one
or more Equity Issuances after the Second Restatement Date, provided
that (i) no Default shall or would exist immediately before or after
the declaration or payment thereof, (ii) as of the date of such
declaration or payment, EBITDA for the Four Quarter Trailing Period is
greater than or equal to $18,000,000, (iii) the aggregate amount of
such dividends paid in any fiscal year shall in no event exceed an
amount equal to 25% of Excess Cash Flow for the Four Quarter Trailing
Period determined as of the date of such declaration or payment, and
(iv) notwithstanding anything to the contrary in any Loan Document, no
such dividends may be declared or paid on or after the Amendment No. 4
Effective Date until such time after April 1, 2001 as each of the
following shall have been satisfied: (A) for a period of 10
consecutive Business Days, (1) no Revolving Loans shall have been
outstanding, (2) the Letter Credit Exposure of all Lenders plus the
aggregate face amount of all outstanding letters of credit obtained
pursuant to Section 8.1(i) shall not have exceeded $10,000,000, and
(3) Total Available Cash shall have been equal to or greater than
$5,000,000, and (B) the Borrower shall have furnished to the
Administrative Agent and each Lender a certificate of a Financial
Officer of the Borrower, in form and substance satisfactory to the
Administrative Agent, setting forth reasonably detailed calculations
demonstrating compliance with Section 8.14 on a pro forma basis
immediately after giving effect to such declaration or payment;”.

      14. Section 8.14 of the Credit Agreement is hereby amended as follows:

		
	 	      (a) Subsection (a) is amended and restated in its entirety to read
as follows:

		
	 	      “(a) Leverage Ratio. The Borrower shall not permit the Leverage
Ratio to at any time exceed the ratio set forth below with respect to
the applicable period set forth below:

-8-

	 	 	 	 	 
	Period		Leverage Ratio
	
		

	July 1, 2000 through September 30, 2000			2.75:1.00	
	
	
	
	

	October 1, 2000 through December 31, 2000			5.00:1.00	
	
	
	
	

	January 1, 2001 through March 31, 2001			4.25:1.00	
	
	
	
	

	April 1, 2001 and thereafter			2.00:1.00	”

		
	 	      (b) The table contained in subsection (b) is amended and restated in
its entirety to read as follows:

	 	 	 	 	 
	Period		Interest Coverage Ratio
	
		

	July 1, 2000 through September 30, 2000			1.30:1.00	
	
	
	
	

	October 1, 2000 through December 31, 2000			1.75:1.00	
	
	
	
	

	January 1, 2001 through March 31, 2001			3.50:1.00	
	
	
	
	

	April 1, 2001 and thereafter			5.00:1.00	

		
	 	      (c) Subsection (d)(ii) is amended by deleting the amount
“$44,000,000” and adding the amount “$43,000,000” in its place.

		
	 	      (d) Subsection (e) is amended by (i) deleting the amount “6,500,000”
where it last appears in the table contained therein and adding the
amount “5000,000” in its place and (ii) adding the following sentence at
the end of such subsection:

		
	 	“Notwithstanding anything to the contrary in this Section, the
Borrower shall not make any Capital Expenditure (or incur any
obligation to make any Capital Expenditure) on or after the Amendment
No.4 Effective Date, or permit any Subsidiary to do so, until such
time after April 1, 2001 as each of the following shall have been
satisfied: (i) for a period of 10 consecutive Business Days, (A) no
Revolving Loans shall have been outstanding, (B) the Letter Credit
Exposure of all Lenders plus the aggregate face amount of all
outstanding letters of credit obtained pursuant to Section 8.1(i)
shall not have exceeded $10,000,000, and (C) Total Available Cash
shall have been equal to or greater than $5,000,000, and (ii) the
Borrower shall have furnished to the Administrative Agent and each
Lender a certificate of a Financial Officer of the Borrower, in form
and substance satisfactory to the Administrative Agent, setting forth
reasonably detailed calculations demonstrating compliance with Section
8.14 on a pro forma basis immediately after giving effect to the
relevant Capital Expenditure, provided, however, that the Borrower and
the Subsidiaries may make Capital Expenditures (or incur obligations
to make Capital Expenditures) on or after the Amendment No. 4
Effective Date in an aggregate amount not to exceed (1) $800,000 in
respect of each of the fiscal quarters

-9-

		
	 	ending on December 31, 2000 and
March 31, 2001, respectively, and (2) $400,000 in respect of each
fiscal quarter thereafter, provided further that, if at the time
thereof and immediately after giving effect thereto no Default shall
have occurred and be continuing, any amounts permitted by this
sentence to be expended in any fiscal quarter and which are not so
expended may be carried over and expended in the immediately
succeeding fiscal quarter only.

		
	 	      (e) The table contained in subsection (f) is amended and restated in
its entirety to read as follows:

	 	 	 	 	 
	Period		Ratio
	
		

	September 30, 1999 through March 31, 2001			Not tested	
	
	
	
	

	April 1, 2001 and thereafter			0.75:1.00	

      15. Section 8.15 of the Credit Agreement is hereby amended as follows:

		
	 	      (a) The following words are added at the end of the first sentence:
“other than property that constitutes Collateral merely by virtue of
being on deposit in such Securities Account”.

		
	 	      (b) The proviso contained in the last sentence is deleted in its
entirety.

      16. Section 9.1(a) of the Credit Agreement is amended and restated in its
entirety to read as follows: “(a) the failure of the Borrower (i) to make any
payment of principal on any Loan, or in respect of any Reimbursement
Obligation, when due and payable, or (ii) to make or cause to be made a deposit
into the BofA Account when required hereby; or”.

      17. Section 11.2 of the Credit Agreement is hereby amended by amending and
restating subsections clauses (a) and (b) to read as follows:

		
	 	      “(a) in the case of any Loan Party, to such Loan Party c/o Global
Vacation Group, Inc., One North First Street, San Jose, California
95113; Attention: Debbie Lundquist, Executive Vice President and Chief
Financial Officer, Telephone (408) 287-4550, Facsimile (408) 287-5953;
with a copy to: Hogan & Hartson, L.L.P., 111 South Calvert Street,
16th Floor, Baltimore, Maryland 21202; Attention: Kevin Gralley,
Esquire, Telephone: (410) 659-2738, Facsimile: (410) 539-6981;

		
	 	      (b) in the case of the Administrative Agent, to The Bank of New
York, One Wall Street, Agency Function Administration, 18th Floor, New
York, New York 10286; Attention: Susan Baratta, Telephone: (212)
635-4632, Facsimile (212) 635-6365 or 6366 or 6367; with a copy to:
The Bank of New York, One Wall Street, New York, New York 10286,
Attention: Peter Helt, Vice President, Telephone: (212) 635-7540,
Facsimile: (212) 635-7513; and”.

-10-

      18. Notwithstanding anything to the contrary in any Loan Document, no
Eurodollar Advance shall be permitted to be made on or after the Amendment No.
4 Effective Date (including by means of conversion) until such time after April
1, 2001 as each of the following shall have been satisfied: (i) for a period of
10 consecutive Business Days, (A) no Revolving Loans shall have been
outstanding, (B) the Letter Credit Exposure of all Lenders plus the aggregate
face amount of all outstanding letters of credit obtained pursuant to Section
8.1(i) shall not have exceeded $10,000,000, and (C) Total Available Cash shall
have been equal to or greater than $5,000,000, and (ii) the Borrower shall have
furnished to the Administrative Agent and each
Lender a certificate of a Financial Officer of the Borrower, in form and
substance satisfactory to the Administrative Agent, setting forth reasonably
detailed calculations demonstrating compliance with Section 8.14 on a pro forma
basis immediately after giving effect to such Eurodollar Advance.

      19. Notwithstanding anything to the contrary in Section 4.1(a) of the
Security Agreement, Friendly Holidays, Inc. is hereby permitted to relocate its
chief executive office to 170 Great Neck Road, Suite LL2, Great Neck, New York
11021, provided that all Uniform Commercial Code financing statements (or
amendments thereto) otherwise required to have been filed pursuant to clause
(ii) of such Section with respect to such relocation shall have been delivered
to the Administrative Agent by no later than November 8, 2000.

      20. Article 10 of the Security Agreement is hereby amended by adding the
following new proviso at the end thereof: “provided, however, that the
provisions of clauses (i) and (ii) of this Article shall not apply to any
release with respect to Collateral that would, immediately after giving effect
to such release, continue to be Collateral but for the release of the security
interest therein pursuant to this Article”.

      21. The Subsidiary Guarantee is hereby amended as follows:

		
	 	      (a) The first sentence of Article 3 is amended by adding the words
“and all Letters of Credit have expired” immediately after the word
“terminated”.

		
	 	      (b) Section 9(h) is hereby amended and restated in its entirety to
read as follows:

		
	 	      “(h) Notwithstanding anything to the contrary contained herein,
(i) on and as of the date of any merger, consolidation, Acquisition or
Disposition permitted by the Credit Agreement, which shall result in
any Subsidiary Guarantor ceasing to be a Subsidiary, (A) such
Subsidiary Guarantor shall, without the consent of any Credit Party,
cease to be a “Subsidiary Guarantor”, and shall have no further
liability, hereunder, and (B) the Liens granted hereby on such
Subsidiary Guarantor’s Collateral shall cease (unless such Collateral
would, immediately after giving effect to such merger, consolidation,
Acquisition or Disposition, continue to be Collateral but for the
release of the security interest therein pursuant to this subclause
(B)), and (ii) promptly after each request therefor by any Subsidiary
Guarantor or the Borrower, the Administrative Agent shall release
items of such Subsidiary Guarantor’s Collateral from the Liens granted
hereby, provided that such items are subject of a Disposition

-11-

		
	 	permitted by Section 8.6 of the Credit Agreement, and provided further
that the provisions of this clause (ii) shall not apply to any release
with respect to Collateral that would, immediately after giving effect
to such release, continue to be Collateral but for the release of the
security interest therein pursuant to this clause (ii).”

      22. Paragraphs 1 through 21 hereof shall not be effective until each of
the following conditions is satisfied:

		
	 	      (a) the Administrative Agent (or its counsel) shall have received
from each of the Loan Parties, the Issuer and the Lenders either (i) a
counterpart of this Amendment signed on behalf of such Person or (ii)
written evidence satisfactory to the Administrative Agent (which may
include telecopy transmission of a signed signature page of this
Amendment) that such Person has signed a counterpart of this Amendment;

		
	 	      (b) the Administrative Agent shall have received, for the account of
each Lender which consents hereto in writing (without any reservation or
condition) on the date hereof, an amendment fee equal to 0.250% of the
amount of such Lender’s Revolving Commitment (as reduced pursuant to
paragraph 3 hereof);

		
	 	      (c) BNY shall have received the fee separately agreed to between it
and the Borrower with respect to this Amendment; and

		
	 	      (d) the Administrative Agent shall have received, for the account of
its counsel, Bryan Cave LLP, all invoiced fees and expenses payable to it
(or for its account) by the Loan Parties.

      23. Each Loan Party hereby (i) reaffirms and admits the validity and
enforceability of each Loan Document and its obligations thereunder, and agrees
and admits that it has no defense to or offset against any such obligation, and
(ii) assuming the effectiveness of paragraphs 1 through 21 hereof in accordance
herewith, represents and warrants that no Default has occurred and is
continuing and that each of its representations and warranties contained in the
Loan Documents is true and correct.

      24. This Amendment may be executed in any number of counterparts, each of
which shall be an original and all of which shall constitute one agreement. It
shall not be necessary in making proof of this Amendment to produce or account
for more than one counterpart signed by the party to be charged.

      25. Each Loan Document shall in all other respects remain in full force
and effect.

      26. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.

[SIGNATURE PAGES TO FOLLOW]

-12-

GLOBAL VACATION GROUP, INC.

AMENDMENT AND WAIVER

      IN WITNESS WHEREOF, the parties hereto have caused this Amendment and
Waiver to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.

	 
	GLOBAL VACATION GROUP, INC
	 
	By:___________________________________

Name:_________________________________

Title:__________________________________
	 
	SUNSHINE VACATIONS, INC.

GLOBAL VACATION MANAGEMENT COMPANY

HADDON HOLIDAYS, INC.

GLOBETROTTERS, INC.

CLASSIC CUSTOM VACATIONS

GLOBETROTTERS VACATIONS, INC.

GVG FINANCE COMPANY

FRIENDLY HOLIDAYS, INC.

ISLAND RESORT TOURS, INC.

INTERNATIONAL TRAVEL & RESORTS, INC.

GVG TECHNOLOGY, INC
	 
	AS TO EACH OF THE FOREGOING:
	 
	By:___________________________________

Name:_________________________________

Title:__________________________________

 

GLOBAL VACATION GROUP, INC.

AMENDMENT AND WAIVER

	 	THE BANK OF NEW YORK,

as Administrative Agent

	 	By:__________________________

Name:_______________________

Title:_________________________

	 	CONSENTED TO AND AGREED:

	 	THE BANK OF NEW YORK,

individually and as Issuer

	 	By:__________________________

Name:_______________________

Title:_________________________

 

GLOBAL VACATION GROUP, INC.

AMENDMENT AND WAIVER

	 	CONSENTED TO AND AGREED:

	 	THE BANK OF AMERICA, N.A.

	 	By:__________________________

Name:_______________________

Title:_________________________

 

GLOBAL VACATION GROUP, INC.

AMENDMENT AND WAIVER

	 	CONSENTED TO AND AGREED:

	 	FIRST UNION NATIONAL BANK

	 	By:__________________________

Name:_______________________

Title:_________________________

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