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Exhibit 10.89    
  

        * Confidential treatment has been requested for certain portions of this Agreement pursuant to a request for confidential treatment sent to the Securities and
Exchange Commission. Such portions are omitted from this filing and have been filed separately with the Securities and Exchange Commission. 

 
 

SUPPLY AGREEMENT    
  

        This Supply Agreement, dated as of 5:00 p.m. (Dallas, Texas time) on November 18, 2002, is by and between Genlyte Thomas Group LLC, a Delaware
limited liability company ("GTG"), acting through its Genlyte Controls Division, and VLPS Lighting Services, Inc., a Delaware corporation formerly known as Vari-Lite, Inc.
("VLPS"). 

 
 

WITNESSETH:    
  

        WHEREAS, VLPS desires to purchase from GTG certain lighting and lighting control products; and 

        WHEREAS,
GTG desires to sell certain lighting and lighting control products to VLPS upon the terms and conditions set forth in this Supply Agreement; 

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

        1.    Definitions.    The following terms when initially capitalized in this Supply Agreement shall have, unless the
context requires otherwise, the following meanings: 

        (a)  "Affiliate"
means, with respect to any specified Person, a Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is
under common control with, the specified Person. As used in this definition, the term "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. 

        (b)  "Applicable
Multiplier" has the meaning provided in Annex I hereto. 

        (c)  "Asset
Purchase Agreement" means the agreement entitled Asset Purchase Agreement and entered into by VLPS, GTG and the Sole Shareholder simultaneously with this Supply
Agreement. 

        (d)  "Assignment"
means (a) with respect to any Buyer (i) a Change in Control of the Buyer or its Parent Entity or (ii) an agreement by Buyer to assign
or transfer any of its rights or obligations under this Supply Agreement and (b) with respect to any Seller (i) a Change in Control of Seller or (ii) an agreement by Seller to
assign or transfer any of its rights or obligations under this Supply Agreement. 

        (e)  "Buyer"
means VLPS or such other Person as may, at the relevant time, be entitled to exercise the rights initially granted to "Buyer" hereunder as a result of one or
more Assignments or other transactions permitted by Section 15, none of which violated Section 15. Any reference to VLPS in Sections 1 through 25, inclusive, of this Supply Agreement is
intended to mean specifically VLPS and not any assignee or other Person. 

          (f)  "Buyer
Authorized Designee" means a Person which, at the relevant time, is authorized by Buyer to exercise any of the rights of Buyer hereunder in a manner expressly
authorized by Section 2(c). 

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        (g)  "Change
in Control" means any of the following: (i) 50% or more of the voting power or stock or other equity interest in the subject Person is hereafter acquired
by another Person (including all Affiliates of such acquiring Person), whether in one or more transactions, unless, prior to the first of such transactions, such other Person and the subject Person
were both members of the same Controlled Group or (ii) the subject Person is merged or consolidated with any other Person, unless, (A) immediately prior to the merger or consolidation,
the other Person and the subject Person were both members of the same Controlled Group or (B) the owners of the equity interests and voting power of the subject Person immediately prior to the
merger or consolidation own more than 50% of both the equity interests and voting power of the surviving entity immediately following the merger or consolidation. 

        (h)  "Controlled
Group" means a Parent Entity and all of its Controlled Subsidiaries. Thus, VLPS and the Sole Shareholder are currently members of the same Controlled Group. 

          (i)  "Controlled
Subsidiary" means any Person with respect to which more than 50% of both the stock or other equity interest and the voting power is owned by the subject
Person, directly or indirectly through one or more other Controlled Subsidiaries. Thus, VLPS is currently a Controlled Subsidiary of the Sole Shareholder since the Sole Shareholder owns all of the
capital stock and voting power of VLPS. 

          (j)  "Dealer
Price" means the price at which Products and/or Division Products are or would typically be sold by Seller to dealers located in North America other than Buyer
after taking into consideration the volume of purchases made by Buyer and such other dealers in North America and any other parameters reasonably considered by Seller in making pricing decisions,
provided that the Dealer Price shall not reflect any special pricing as a result of or related to either (i) discounts, if any, afforded a dealer or dealers for purchases for resale or rental
in a specific territory or area, or (ii) for one or more specific customers, projects and/or jobs unless such special pricing is offered under a program made available to all dealers of Seller
generally or to an identified dealer or group of dealers of Seller and Buyer satisfies the criteria designated by Seller to participate in such program. 

        (k)  "Delivered"
means Products, Division Products and/or Parts, as applicable, shipped FOB from a Seller facility for delivery to Buyer or its designee at a specific
location. Thus, by way of example, a Product "Delivered by Seller in the Japanese Market" would be a Product shipped FOB from a Seller facility for delivery in the Japanese Market. 

          (l)  "Division
Products" means products labeled by Seller with the "Entertainment Technology" or "ET" name, and not any other product or products of Seller. 

        (m)  "European
Market" means the countries in Europe identified on Exhibit "A" hereto. 

        (n)  "European
Market Purchase Price" means the amount of Paid Purchases for Products, Division Products and Parts sold by Seller to Buyer or any Buyer Authorized Designee
and Delivered into the European Market at the time of such sale. For purposes of calculating the European Market Purchase Price, except as hereafter otherwise provided, all Products, Division Products
and Parts that are subject to an unfilled purchase order submitted to Seller on or before October 31 of any year shall be deemed a Paid Purchase in the year such purchase order was submitted
(and not any subsequent year), provided that (i) such purchase order may not be cancelled, (ii) such purchase order requests a Delivered date into the European Market prior to
December 31 of that year, and (iii) Buyer or any Buyer Authorized Designee pays the purchase price under such purchase order by the later of (1) the end of February of the
immediately following year or (2) sixty (60) days after any Products, Division Products or Parts under such pre-October 31 purchase order are Delivered.
Notwithstanding the foregoing (but without modifying Seller's obligations under Section 2(a)), if Seller uses commercially reasonable efforts to 

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Deliver any Products, Division Products or Parts with respect to such pre-October 31 purchase order by June 1 of the immediately following year and still fails to do so,
Paid Purchases for any such Products, Division Products or Parts which were not delivered by such June 1 will not be included as part of the "European Market Purchase Price" for the year in
which such order was placed (but will be deemed to be part of the "European Market Purchase Price" for the year, if any, in which such Products, Division Products or Parts are Delivered into the
European Market to the extent the invoice therefor is paid by the end of February of the immediately following year). For purposes of this definition of "European Market Purchase Price" any Products,
Division Products or Parts Delivered between November 1 and December 31 of any year shall be deemed Paid Purchases for that year and no other year as long as the purchase price therefor
is paid on or before the last day of February of the immediately following year. 

        (o)  "European
Market Purchase Price Minimum" means U.S.$4,500,000 for 2005, U.S.$4,725,000 for 2006, U.S.$4,961,250 for 2007, U.S.$5,209,313 for 2008, U.S.$5,469,778 for
2009, U.S.$5,743,267 for 2010, and U.S.$6,030,430 for 2011. The European Market Purchase Price Minimum for any year after 2011 shall be determined by compounding the European Market Purchase Price
Minimum for 2011 (beginning January 1, 2012) using a growth rate of 5% per year (thus, by way of example, if applicable, the amount for 2012 would be U.S.$6,331,952 and the amount for 2013
would be U.S.$6,648,549). 

        (p)  "Exact
Copy" means any product manufactured using 50% or more of the same proprietary tooling which is used to manufacture a Product. As used in this definition of
"Exact Copy", "manufactures" and "manufacturing" shall include manufacturing, assembling, arranging for another Person to manufacture or assemble on an OEM or private label basis or selling under its
own trade name, trademark or other brand. As used in this definition, the term "proprietary tooling" means tooling which is owned by Seller or Seller's vendor and was designed by or under the
direction of VLPS or Seller for the specific purpose of manufacturing Products. 

        (q)  "Excluded
Sale" means any sale or sales of Products purchased hereunder which: (i) follows an Assignment by Buyer in violation of or not expressly permitted by
Section 15 or any other violation of any obligation of Buyer under Section 15, (ii) is or includes a sale or sales (exclusive of any Products delivered by Buyer or any Buyer
Authorized Designee to its customers in the Exclusive Territory, if any) of any New/Nearly New Products to any Prohibited Participant, (iii) is or includes a sale or sales (exclusive of any
Products delivered by Buyer or any Buyer Authorized Designee to its customers in the Exclusive Territory, if any) of more than U.S.$25,000 (or the equivalent in any foreign currency) in any calendar
year of New/Nearly New Products to any Seller appointed dealer (including Affiliates of such dealer) of Products or any other dealer (including Affiliates of such dealer) of automated lighting
products, or (iv) is or includes a sale or sales (exclusive of any Products delivered by Buyer and each Buyer Authorized Designee to its customers in the Exclusive Territory, if any) of
New/Nearly New Products to a customer who or which is not an Existing Rental Customer of Buyer, or to a permanent installation (such as a theater, museum, theme park, etc.) or other automated
luminaire lighting project, permanent installation or job that, prior to such sale or sales, had not been Registered for Spec Credit. A lease which is not a "true lease" or which would be expected to
be capitalized under United States generally accepted accounting principles will be considered a sale and not a lease for purposes of this definition. As used in this definition of "Excluded Sale",
(i) "Existing Rental Customer of Buyer" means a customer (together with such customer's Affiliates) of Buyer or any Buyer Authorized Designee which had, in the preceding 104-week
period, leased or rented automated luminaires from
Buyer or any Buyer Authorized Designee for which such customer had paid Buyer or any Buyer Authorized Designee at least U.S.$25,000 and (ii) "Registered for Spec Credit" means the registration
by Buyer in writing with Seller of a project, permanent installation or job for "specification credit" in accordance with and subject to the then established Seller specification 

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credit procedures generally applicable to Seller's dealers of Products. By way of example, if Seller's specification credit procedures generally applicable to dealers of Products at the relevant time
permits only the first Person to register for a particular project to be considered registered for specification credit for that project the Buyer could not be Registered for Spec Credit for that
project unless the Buyer is the first Person to register for such project under Seller's procedures. 

        (r)  "Exclusive
Territory" means, except as hereafter otherwise provided, (i) during the balance of 2002 and during 2003, 2004 and 2005, the Japanese Market and the
European Market, (ii) during each of 2006, 2007, 2008, 2009, 2010, 2011 and 2012 and during each subsequent year (if any) during the Term, the Japanese Market if the Japanese Market Purchase
Price in each prior calendar year exceeded the Japanese Market Purchase Price Minimum for such prior calendar year and (iii) during each of 2006, 2007, 2008, 2009, 2010, 2011 and 2012 and
during each subsequent year (if any) during the Term, the European Market if the European Market Purchase Price in each prior calendar year exceeded the European Market Purchase Price Minimum for such
prior calendar year. 

        (s)  "FAC"
has the meaning provided in Annex I hereto (except as otherwise provided in Section 3), which is incorporated herein for all purposes. 

          (t)  "FOR"
has the meaning provided in Annex I hereto. 

        (u)  "Japanese
Market" means the country of Japan. 

        (v)  "Japanese
Market Purchase Price" means the amount of Paid Purchases for Products, Division Products and Parts sold by Seller to Buyer or any Buyer Authorized Designee
and Delivered into the Japanese Market at the time of such sale. For purposes of calculating the Japanese Market Purchase Price, except as hereafter otherwise provided, all Products, Division Products
and Parts that are subject to an unfilled purchase order submitted to Seller on or before October 31 of any year shall be deemed a Paid Purchase in the year such purchase order was submitted
(and not any subsequent year), provided that (i) such purchase order may not be cancelled, (ii) such purchase order requests a Delivered date into the Japanese Market prior to
December 31 of that year, and (iii) Buyer or any Buyer Authorized Designee pays the purchase price under such purchase order by the later of (1) the end of February of the
immediately following year or (2) sixty (60) days after any Products, Division Products or Parts under such pre-October 31 purchase order are Delivered.
Notwithstanding the foregoing (but without modifying Seller's obligations under Section 2(a)), if Seller uses commercially reasonable efforts to Deliver any Products, Division Products or Parts
with respect to such pre-October 31 purchase order by June 1 of the immediately following year and still fails to do so, Paid Purchases for any such Products, Division
Products or Parts which were not delivered by such June 1 will not be included as
part of the "Japanese Market Purchase Price" for the year in which such order was placed (but will be deemed to be part of the "Japanese Market Purchase Price" for the year, if any, in which such
Products, Division Products or Parts are Delivered into the Japanese Market to the extent the invoice therefor is paid by the end of February of the immediately following year). For purposes of this
definition of "Japanese Market Purchase Price" any Products, Division Products or Parts Delivered between November 1 and December 31 of any year shall be deemed Paid Purchases for that
year and in no other year as long as the purchase price therefor is paid on or before the last day of February of the immediately following year. 

        (w)  "Japanese
Market Purchase Price Minimum" means U.S.$500,000 for 2005, U.S.$525,000 for 2006, U.S.$551,250 for 2007, U.S.$578,813 for 2008, U.S.$607,753 for 2009,
U.S.$638,141 for 2010 and U.S.$670,048 for 2011. The Japanese Market Purchase Price Minimum for any year after 2011 shall be determined by compounding the Japanese Market Purchase Price Minimum for
2011 annually (beginning January 1, 2012) using a growth rate of 5% per year (thus, by way of example, 

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if applicable, the amount for 2012 would be U.S.$703,550 and the amount for 2013 would be U.S.$738,728). 

        (x)  "Minimum
Charge" means U.S.$10.00 for each item of Parts (regardless of the quantity of each item of Parts ordered), but in no event less than U.S.$50.00 per purchase
order. 

        (y)  "New/Nearly
New Product" means any and each Product (including any item which would be a Product but for the removal of the "VARI*LITE" label) which was Delivered
hereunder within one year prior to the time of its sale by Buyer. 

        (z)  "Noncompetition
Agreement" means the agreement entitled Noncompetition Agreement which was entered into by GTG, VLPS and Sole Shareholder simultaneously with this Supply
Agreement. 

      (aa)  "Paid
Purchases" means the amounts actually paid to Seller in U.S. dollars for Products, Division Products and Parts sold and Delivered hereunder for which Seller has
received full payment; thus, the term "Paid Purchases" shall not include any amounts paid for taxes (sales, use, export, import, or otherwise), shipping, insurance or duties or for any item other than
the purchase price of Products, Division Products and Parts. 

      (bb)  "Parent
Entity" means a Person which (a) has a Controlled Subsidiary which is the Buyer or Seller and (b) is not a Controlled Subsidiary of any Person
(including all Affiliates of any Person). Thus, the Sole Shareholder is the Parent Entity of VLPS on the date hereof. 

      (cc)  "Parts"
means bulbs for the Products and Division Products (if any), parts and subassemblies for the Products and the Division Products (if Seller at the relevant time
generally provides repair parts for Division Products), Gobos and parts and subassemblies for Gobos and, to the extent in Seller's stock at the relevant time, parts and subassemblies purchased by GTG
from VLPS pursuant to the Asset Purchase Agreement, including, parts and subassemblies for VARI*LITE® Series 200TM, Series 300TM, VirtuosoTM
and Virtuoso DXTM products. 

      (dd)  "Permitted
Amount" shall mean an amount equal to the greater of (i) the net purchase price (excluding rebates and refunds) paid for all Products purchased during
the calendar year immediately preceding date of the Assignment of this Supply Agreement by the First Time Assignee (as hereinafter defined), or (ii) 40% of Seller's total annual production
(determined on January 1 of each year based on the net purchase price (excluding rebates and refunds) paid for all Products shipped by Seller in the immediately preceding calendar year),
provided that (1) after the amount calculated by the foregoing clause (ii) of this definition has been first determined, it shall increase thereafter using a growth rate of 5% per year
compounded annually, and (2) if the Assignment by the First Time Assignee occurs on or before December 31, 2003, the amount determined pursuant to the foregoing clause (ii) of
this definition shall be U.S.$10,000,000. 

      (ee)  "Permitted
Assignment" means any agreement of a Controlled Subsidiary of the Sole Shareholder to assign or transfer any rights under this Supply Agreement to an entity
which is a Controlled Subsidiary of the Sole Shareholder if there has not then been a Change in Control of the Sole Shareholder. 

        (ff)  "Person"
means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, labor union, or other entity or governmental body. 

      (gg)  "Products"
means, subject to the limitations hereafter provided, new entertainment lighting and lighting control products sold by Seller and labeled with "VARI*LITE" or
a name confusingly similar thereto. Subject to the provisions of Section 7, Products are expected to include but may not necessarily be limited to VARI*LITE®
Series 1000TM, Series 2000TM and Series 3000TM products sold by Seller, the rights to which were purchased by GTG from VLPS pursuant to the 

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Asset Purchase Agreement. Notwithstanding anything contained herein to the contrary, the term "Products" does not include Division Products or Parts. 

      (hh)  "Prohibited
Participant" shall mean any Person and its Affiliates, taken as a whole, which, (i) as their primary business, manufactures lighting and/or lighting
control products for sale to Persons other than Affiliates of such Person, or (ii) generated in one of the three most recent calendar years more than U.S.$10,000,000 in gross sales from the
manufacturing of lighting and/or lighting control products for sale to Persons other than Affiliates of such Person. As used in this definition of "Prohibited Participant", "manufactures" and
"manufacturing" shall include manufacturing, assembling, arranging
for another Person to manufacture or assemble on an OEM or private label basis or selling under its own trade name, trademark or brand. 

        (ii)  "Seller"
means GTG or such other Person as may, at the relevant time, be entitled to exercise the rights initially granted "Seller" hereunder as a result of one or more
Assignments, none of which violated Section 15. Any reference to GTG in Sections 1 through 25, inclusive, of this Supply Agreement is intended to mean specifically GTG and not any assignee or
other Person. 

        (jj)  "Sole
Shareholder" means Vari-Lite International, Inc., a Delaware corporation, which is the sole shareholder of VLPS on the effective date of this
Supply Agreement. 

      (kk)  "Term"
means the period of time commencing as of the date hereof through the termination of this Supply Agreement pursuant to Section 12. 

        (ll)  "Terms
and Conditions" means the terms and conditions extended by Seller hereunder as they may be modified from time to time, but in no case shall the terms and
conditions generally extended by Seller to Persons other than Buyer be any more favorable to such Persons than the Terms and Conditions are to Buyer. The initial Terms and Conditions have been
initialed by the parties as of the date hereof. Notwithstanding the foregoing, however, if and to the extent any provision of the Terms and Conditions conflict with any provision of this Supply
Agreement, the provisions of this Supply Agreement shall govern during the Term and such Terms and Conditions shall govern following the Term. 

    (mm)  "Third
Party Service Center" means any Person appointed by Buyer to serve as a service center in the Exclusive Territory pursuant to Section 6. 

        2.    Agreement to Supply Products.    

        (a)  Subject
to the provisions of Section 2(b), the provisions of Section 8 and the Terms and Conditions, Seller will, during the Term, use commercially
reasonable efforts to supply and sell to Buyer any and all Products, Division Products and Parts then being sold by Seller to the extent Seller receives purchase orders from Buyer in form reasonably
acceptable to Seller. Seller will not withhold shipment of Products with the primary purpose of avoiding or reducing payment of any amount otherwise payable under Section 4. Buyer will have no
obligation to purchase any Products, Division Products or Parts hereunder except to the extent Buyer delivers non-cancelable purchase orders (based on Seller's policies) therefor to
Seller. The parties agree that the Terms and Conditions will apply to any and all Products, Division Products and Parts sold by Seller hereunder. 

        (b)  Subject
to the provisions of this Supply Agreement, Seller hereby appoints Buyer as an authorized dealer of, with the right to sell to Buyer's customers, the Products
and Division Products throughout the World other than the Exclusive Territory (including in the Middle East and Africa the right to appoint and sell or otherwise distribute to distributors and
dealers). With respect to the Exclusive Territory, if any, as it may be constituted from time to time, subject to the provisions of this Supply Agreement, Seller hereby appoints Buyer as
(i) the exclusive authorized distributor of the Products, with the right to sell to Buyer's customers and otherwise distribute the 

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Products in the Exclusive Territory, if any, including the right to sell to distributors and dealers appointed by Buyer in the Exclusive Territory, and (ii) a non-exclusive
distributor of the Division Products, with the right to sell to Buyer's customers and otherwise distribute the Division Products in the Exclusive Territory, if any, including the right to sell to
distributors and dealers appointed by Buyer in the Exclusive Territory, if any. Notwithstanding anything contained herein to the contrary, except as expressly provided in the immediately following
sentence, Seller shall have no duty to qualify or take any action to qualify, permit or facilitate the sale or import of any Products, Parts or Division Products in any country, territory or other
location. Seller will use commercially reasonable efforts to take the steps a manufacturer would normally be expected to take to qualify, cause or permit the Products and Parts to comply with
applicable legal requirements so they may be sold and distributed in North America and the Exclusive Territory, if any. At such time as Buyer's exclusive rights to act as a distributor in any part of
the Exclusive Territory shall terminate, the rights granted to distributors and dealers appointed by Buyer shall terminate and Buyer shall remain a non-exclusive dealer of the Products and
Division Products in such part of the Exclusive Territory for the remainder of the Term. As a condition to any duty of Seller to supply or sell any Products, Division Products or Parts pursuant to
this Supply Agreement, Buyer shall (i) sign and deliver such dealer and/or distributor agreements as Seller may from time to time reasonably request, provided such agreements are consistent
with the terms of any agreements Seller generally has with other dealers or distributors (except as necessary to not be in conflict with the provisions of this Supply Agreement), and (ii) be
current in all amounts owed to Seller. In the event of any conflict between this Supply Agreement and such dealer and/or distributor agreements, this Supply Agreement shall govern during the Term and
such dealer and/or distributor agreements shall govern following the Term. 

        (c)  Until
there has been a Change in Control of Buyer's Parent Entity, Buyer may authorize Buyer's Parent Entity or any Person which is a Controlled Subsidiary of Buyer's
Parent Entity at the relevant time to exercise, without duplication (although purchases and resales of Products, Division Products and Parts or the exercise of Buyer's rights under Section 6 by
more than one Person will not be considered duplication), any of the rights of Buyer under this Supply Agreement upon notice to Seller and on the condition that Buyer and Buyer's Parent Entity are
each jointly and severally liable to Seller (and document to Seller's reasonable satisfaction such joint and several liability) with respect to any failure to perform any obligation to Seller under
this Supply Agreement, whether by Buyer and/or any such Person exercising such rights. 

        3.    Purchase Prices.    

        (a)  ******************************************************************************************
************************************************************************************************* *************************************************************************************************
************************************************************************************************* ************************************************************************************************* 

        (b)  For
Parts Delivered during the Term, Seller will charge Buyer, and Buyer will pay Seller, an amount equal to the greater of either (i) the Minimum Charge or
(ii) the FAC for each Part determined based on a process similar to the process set forth in Annex I hereto used to determine the FACs for Products, multiplied by the Applicable Multiplier;
provided, however, with respect to each Part that was purchased by GTG from VLPS pursuant to the Asset Purchase Agreement and that is listed on the list dated this date, titled "FACS FOR CERTAIN
PARTS", and initialed by GTG and VLPS, the FAC shall be as set forth therein. Except with respect to the Minimum Charge, in no case shall the price charged by Seller pursuant to this
Section 3(b) be more than the price at which Seller does or would typically sell to dealers located in North America other than Buyer after taking into consideration the volume of purchases
made by such dealer and any other parameters reasonably considered by Seller in making pricing decisions. 

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Except with respect to the Parts purchased by GTG from VLPS pursuant to the Asset Purchase Agreement that are listed on the "FACS FOR CERTAIN PARTS" list described above, the FAC for each Part shall
be determined by Seller, and Buyer shall have audit rights with respect to Seller's determination of the FAC for each Part, consistent with the provisions set forth in Section 3 of Annex I
hereto. 

        (c)  All
sales and use taxes, shipping costs from Seller's shipping dock, duties, import taxes, export taxes and insurance expenses shall be borne solely by Buyer, and will
not be considered part of the purchase price for Products, Parts and Division Products. 

        4.    Rebate Rights.    Seller shall pay to Buyer (but not to Controlled Subsidiaries of Buyer's Parent Entity unless
otherwise directed to do so by Buyer) rebates based on the Paid Purchases of Products (reduced by the amount of Paid Purchases of Products whether during or prior to the applicable period, to the
extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)), as provided in Annex I hereto, subject only to the express limitations and conditions in this
Supply Agreement and said Annex I. Buyer shall pay to Seller any and all amounts required by Annex I hereto. 

        5.    Exclusive Rights.    During the Term, Seller will (a) not sell or deliver Products or Exact Copies into
the Exclusive Territory, if any, except at the request of Buyer, (b) not knowingly sell or deliver Products or Exact Copies to any Person other than Buyer without the prior consent of Buyer if
and to the extent Seller knows such Person is attempting to buy or obtain possession of such Products or Exact Copies for the purpose of selling or delivering them into the Exclusive Territory, and
(c) include a legend in form and substance reasonably necessary to reflect that Seller reserves the right not to make future sales to any Person who buys or otherwise accepts delivery of
Products for the purpose of selling or delivering them into the Exclusive Territory (although Seller shall have no obligation to refrain from making such future sales to such Person) and stating that
the sale or delivery of the Products into the Exclusive Territory will void any product warranty (although such provision shall not preclude Seller, in
its discretion, from providing warranty services or remedies as long as Seller does not maintain a physical presence (other than with respect to people and items used by them for servicing Products)
in the Exclusive Territory, if any) in the following form documents with respect to Products, whether maintained in hard copy or electronic format, if and when maintained by Seller: written or
electronic form dealer or distributor agreements, written or electronic form terms and conditions, written or electronic form warranty cards, and written or electronic form quote documents (with all
such agreements, terms and conditions, warranty cards and quotes being considered a "written or electronic form" or "form documents" only if they are a form generally used by Seller to appoint dealers
and distributors, specify terms and conditions, notify customers of warranties or provide quotes for Products). For purposes of this Section 5 only, the term "Products" shall be deemed to
include any product that would be a Product but for the fact it is not new. 

        6.    Appointment as Service Center; Indemnification.    

        (a)  Subject
to the provisions of this Supply Agreement, Seller hereby appoints Buyer, and Buyer agrees to act, as the exclusive service center for servicing, and Buyer
agrees to service, Products during the Term to the extent necessary to provide warranty services Seller is obligated to provide in the Japanese Market as long as it remains a part of the Exclusive
Territory and in the European Market as long as it remains a part of the Exclusive Territory (provided that nothing in this Section 6 shall prevent Seller from servicing Products in the
Exclusive Territory, if any, as long as Seller does not maintain a physical presence (other than with respect to service people and items used by them for servicing Products) in the Exclusive
Territory, if any). Buyer will sign and deliver such service center agreements as Seller may from time to time reasonably request (with respect to both part (a) and part (b) of this
Section 6), provided such agreements are consistent with the terms of agreements Seller generally has with other service centers. In the event of any 

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conflict between this Supply Agreement and any such service center agreement, this Supply Agreement shall govern during the Term and such service center agreement shall govern following the Term.
Buyer will have the right, at any time and from time to time, to appoint Third Party Service Centers to act as service centers in the Exclusive Territory, and Buyer shall advise Seller of such
appointment within 30 days of the date it appoints any Third Party Service Center. As a condition to being so appointed, each Third Party Service Center will execute and deliver such documents
as Seller may reasonably request, provided such documents are consistent with the terms of documents Seller generally has with other service centers, and agree to be permanently terminated and not
reappointed as a Third Party Service Center if reasonably requested by Seller. Notwithstanding anything contained herein to the contrary, the appointment of Buyer and/or each Third Party Service
Center shall terminate 90 days following written notice by Seller, Buyer or the Third Party Service Center, which written notice shall not be sent prior to the earlier of (i) the end of
the Term or (ii) with respect to the European Market or Japanese Market, the date that it ceases to be a part of the Exclusive Territory. Seller will reimburse Buyer or any appropriate Third
Party Service Center for all approved warranty services provided for Products pursuant to this Section 6(a) on the same basis Seller reimburses other service centers appointed by Seller, if
any, or if none, on a reasonable basis for the services rendered. Neither Buyer nor any Third Party Service Center shall be obligated to provide any warranty or other service with respect to Products
or Exact Copies sold as new products into the Exclusive Territory but which were neither (i) sold to or at the request of Buyer or any Affiliate of Buyer nor (ii) sold or delivered into
the Exclusive Territory by, at the request of or with the approval of Buyer, any Affiliate of Buyer or any Person in Buyer's Controlled Group. 

        (b)  In
addition, at Buyer's option, which may be exercised at any time during the Term (and from time to time with respect to separate locations), Seller will appoint Buyer,
on generally the same terms as other service centers authorized by Seller, to act as a non-exclusive service center during the Term for servicing Products at any Buyer location in North
America and at any other locations throughout the world where Buyer has an office from time to time. 

        (c)  Buyer
will indemnify and hold harmless Seller from any and all losses, damages, claims and expenses (including reasonable attorneys fees and charges) arising from any
breach of contract (including the provisions of this Supply Agreement and the contracts, if any, entered into by Buyer pursuant hereto) by, or any negligent, tortious or illegal act of, Buyer,
including in connection with or related to serving as a service center. Seller will, except as hereafter otherwise provided, indemnify and hold harmless Buyer from any and all losses, damages, claims
and expenses (including reasonable attorneys fees and charges) arising from any breach of contract (including the provisions of this Supply Agreement and the contracts, if any, entered into by Seller
pursuant hereto) by, or any negligent, tortious or illegal act of, Seller, including in connection with or related to any product liability or patent infringement claim asserted against Buyer with
respect to any Products, Division Products and/or Parts manufactured and sold by Seller to Buyer after the date hereof; provided, however, Seller will not be required to indemnify Buyer for any claim
hereunder to the extent either (i) such claim would not be valid if all the representations in §3 of the Asset Purchase Agreement were accurate or (ii) VLPS and/or Sole
Shareholder is obligated to indemnify GTG with respect to the subject matter of that claim under the Asset Purchase Agreement. Buyer will, as a condition of appointing a Third Party Service Center,
include a provision in a contract with the Third Party Service Center which will require (for the benefit of Seller) such Third Party Service Center to indemnify and hold harmless Seller from any and
all losses, damages, claims and expenses (including reasonable attorneys fees and charges) arising from any breach of contract by, or any negligent, tortious or illegal act of, such Third Party
Service Center, including in connection with or related to serving as a service center. 

9

 

        7.    Withdrawal Rights of Products and Division Products.    If, during the Term, Seller should desire to withdraw
any Product or Division Product from its product line offering, Seller shall use commercially reasonable efforts to give Buyer written notice at least ninety (90) days prior to the effective
date of such withdrawal and shall use commercially reasonable efforts to fill any Buyer orders for such withdrawn Product and/or Division Product placed prior to such effective date. Minor changes
which do not substantially affect the fit, form or function of the Product or Division Product shall not be deemed a "withdrawal" pursuant hereto, and Seller shall be entitled to make such minor
changes without prior notice to Buyer. 

        8.    Provision of Parts.    

        (a)  Seller
will maintain such inventory of Parts as Seller in its sole discretion determines appropriate. If in stock on the date of Delivery, Seller will sell Parts to
Buyer on the terms provided in this Supply Agreement, although this provision shall not obligate Seller to maintain Parts in stock. 

        (b)  If
Seller fails to sell to Buyer on a reasonably prompt basis any Part (other than Parts for the Division Products) and such failure continues for 30 days after
Buyer gives written notice thereof to Seller, Buyer shall have as its sole and exclusive remedy the rights expressly provided in this Section 8(b). Seller will, with a reasonable time following
the receipt of written demand from Buyer, deliver to Buyer at its principal office, Seller's existing working drawings, specifications and list of suppliers for such Part, if any, as may be reasonably
requested by Buyer. In addition, Seller shall authorize the use of tools by, and grant limited licenses (as reasonably determined appropriate by Seller) to, any Person (who shall not be a Prohibited
Participant) designated by Buyer, all as may be reasonably necessary to enable Buyer to obtain, use and sell such Part. Seller will not be required to either (i) create any new engineering
drawings, specifications and tooling if they do not exist or (ii) make available or authorize the use of tooling if such use would interfere with Seller's need for such tooling. All reasonable
out-of-pocket third party costs Seller incurs in performing its obligations under this Section 8(b) shall be promptly reimbursed by Buyer. 

        9.    Warranty; Limitation on Liability.    

        (a)  Seller
shall provide, with respect to all Products, Division Products and Parts sold by Seller hereunder, a warranty, as modified from time to time, on terms no less
favorable than any other warranty generally offered by Seller with respect to the relevant Product, Division Product or Part. EXCEPT AS SPECIFICALLY SET FORTH IN THE IMMEDIATELY PRECEDING SENTENCE,
(i) BUYER ACKNOWLEDGES THAT THE PRODUCTS, DIVISION PRODUCTS AND PARTS WILL BE TRANSFERRED TO BUYER WITHOUT ANY REPRESENTATION OR WARRANTY, IN "AS
IS" CONDITION and (ii) BUYER HAS NOT RELIED AND WILL NOT RELY ON ANY REPRESENTATION OR WARRANTY OF SELLER, EXPRESS OR IMPLIED, AS TO THE PHYSICAL CONDITION OF THE
PRODUCTS, DIVISION PRODUCTS AND PARTS OR OTHERWISE, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. The initial warranty is set forth as part of the initial Terms and
Conditions. 

        (b)  Notwithstanding anything in this Supply Agreement to the contrary, no Person shall be liable for any incidental, consequential or exemplary
damages in connection with any breach of this Supply Agreement or any duty hereunder.

        10.    Export or Re-Export of Technical Information.    The parties acknowledge that export or
re-export of technical data or any product that is produced as a result of the use of such technical data is subject to the requirement of a license under the U.S. Export Administration
Act of 1969, as amended, and its implementation regulations, as amended, and is possibly further regulated by the laws, rules and regulations of other countries and jurisdictions. Buyer will not
knowingly export or 

10

 

re-export technical data furnished by Seller or any of its Affiliates or any product that is produced as a result of the use of such technical data to any country or other area determined
by the United States of America or other applicable governmental authority to be a prohibited destination, unless Buyer has first obtained all necessary export licenses and satisfied all governmental
requirements so that such destination is no longer prohibited by applicable law or authority. 

        11.    Right to Use "Vari-Lite" Trade Name in Japan.    As long as the Exclusive Territory includes the
Japanese Market, Seller shall not object to the use in Japan by Buyer or its Affiliates of the trade name "Vari-Lite Japan". Seller shall not (a) for two (2) years from and
after the date hereof, object to the use by Buyer or its Affiliates of the trade name "Vari-Lite Asia", (b) from and after the date hereof, use the trade name "Vari-Lite
Asia" or (c) during the Term, use or authorize any other Person to use the trade name "Vari-Lite" or any other name confusingly similar thereto in Japan except as contemplated by
the immediately following sentence. Notwithstanding the foregoing, Seller may use the name "Vari-Lite" in connection with the labeling of and/or promotion of the Products in Japan and
elsewhere. At all times during and after the Term, any trademark rights or any benefits arising out of any usage of the trademark or trade name "Vari-Lite" or any confusingly similar
trademark shall inure to the sole benefit of GTG, the acknowledged owner of "Vari-Lite" trademark. 

        12.    Term and Termination.    

        (a)  Subject
to Section 12(d), this Supply Agreement shall commence on the date hereof and terminate upon termination pursuant to Section 12(b), (c) or
(d), whichever first occurs. 

        (b)  Seller
may terminate this Supply Agreement upon the occurrence of any of the following: 

          (i)  Buyer
shall default in the performance of any of its obligations under this Supply Agreement or VLPS shall default in the performance of any of its obligations under
the Noncompetition Agreement, and such default is not cured within 30 days after receipt by Buyer or VLPS of written notice from Seller in the case of a monetary default or within
90 days after receipt by Buyer or VLPS of written notice from Seller in the case of any other default; 

        (ii)  Buyer
shall make a general assignment for the benefit of creditors or shall become or be adjudicated a bankrupt or shall voluntarily file a petition in
bankruptcy, or file an answer admitting the material allegations of a petition filed against it for an adjudication in bankruptcy, or shall apply for or suffer the appointment of a receiver of its
property and assets and such receiver so appointed shall not be discharged within 60 days after his appointment; 

        (iii)  at
the time Buyer or any Affiliate of Buyer is or becomes a Prohibited Participant; 

        (iv)  if
Buyer or any Affiliate of Buyer or any assignee of any of the rights of Buyer hereunder violates any provision of Section 15, makes or agrees to make (even if
null and void under this last sentence of Section 15) any assignment of its rights or obligations under this Supply Agreement or takes or permits any action to be taken which results in an
Assignment or other action (even if null and void under this last sentence of Section 15) which violates any requirement of or is not expressly permitted by Section 15. 

        (c)  This
Supply Agreement shall automatically terminate upon the later of ten years after the date hereof or 30 months following notice from Seller to Buyer of
Seller's election to terminate this Supply Agreement. 

        (d)  Buyer
may terminate this Supply Agreement at any time and for any reason upon 30 days prior written notice to Seller. 

11

 

        (e)  The
obligation of Buyer to pay for Products, Division Products and Parts sold during or after the Term, the obligation of Seller and Buyer, if any, to pay amounts due
under Section 4 for or relating to Products Delivered during the Term and the obligation (if any) of Seller to use commercially reasonable efforts to fill any accepted (during the Term) but
unfilled purchase orders, the duties of the parties under any other agreement and the provisions of Sections 6(c), 9, 10, 11 and 13 through 25 shall survive the termination of this Supply Agreement
and, if applicable, the provisions of Section 6(a) shall survive the termination of this Supply Agreement until expiration of the 90-day period provided for in Section 6(a).
In all other cases, the parties shall have no obligations under this Supply Agreement following the termination hereof. 

          (f)  Termination
of this Supply Agreement and the other remedies provided in this Section 12 shall not be the exclusive remedies for any breach of this Supply
Agreement, and each party shall be entitled to all other remedies available at law or in equity, subject to the limitations in Section 9. 

        13.    Independent Contractors.    This Supply Agreement does not make either Buyer or Seller the employee, agent or
legal representative of the other for any purpose whatsoever. Neither Buyer nor Seller is granted any right or authority to assume or to create any obligation or responsibility, express or implied, on
behalf or in the name of the other. In fulfilling its obligations or exercising its rights pursuant to this Supply Agreement each of Buyer and Seller shall be acting as an independent contractor. No
partnership or joint venture arrangement shall exist between the Buyer and Seller as a result of this Supply Agreement. 

        14.    Confidentiality.    

        (a)  VLPS
has entered into confidentiality and related obligations under the Asset Purchase Agreement, which confidentiality and related obligations apply to information
currently known to VLPS. However, as an additional obligation (and not in lieu of any other obligation of Buyer), all Seller Confidential Information (as defined below) relating to or obtained from
Seller or its Affiliates shall be held in confidence by Buyer and each Buyer Authorized Designee to at least as great an extent and in at least the same manner as Buyer protects its own confidential
or proprietary information but using no less than reasonable care. Except as otherwise required by law, neither Buyer nor any Buyer Authorized Designee shall disclose, publish, release, transfer or
otherwise make available Seller Confidential Information in any form to, or for the use or benefit of, any person or entity without Seller's prior written consent during the Term and for a period of
three years thereafter. "Seller Confidential Information" for purposes of this Section 14(a) means all proprietary information (whether or not specifically labeled or identified as
confidential), in any form or medium, that is disclosed by Seller or its agents or representatives to Buyer or any Buyer Authorized Designee in the performance of this Supply Agreement that relates to
the business, products, services, research or development of Seller, its suppliers, distributors or customers. Seller Confidential Information includes the following: (i) internal business
information (including information relating to strategic and staffing plans and practices, marketing, promotional and sales plans, practices and programs, training practices and programs, cost, rate
and pricing structures and accounting and business methods); (ii) identities of, individual requirements of, specific contractual arrangements with, and information about, suppliers,
distributors and customers and their confidential information, (iii) trade secrets, trade dress, ideas, inventions, designs, developments, devices, methods, processes and systems (whether or
not patentable or copyrighted and whether or not reduced to practice or fixed in a tangible medium), and (iv) the specific terms and conditions of this Supply Agreement. Notwithstanding the
foregoing, Seller Confidential Information shall not include any information (i) that is publicly available other than through the disclosure by Buyer or the Buyer Authorized Designee,
(ii) that was previously known to Buyer or the Buyer Authorized Designee free of any obligation to keep it confidential, excluding any such information that GTG purchased from VLPS pursuant to
the Asset Purchase Agreement or which 

12

 

otherwise relates primarily to the assets or business acquired by GTG from VLPS pursuant thereto, or (iii) that was lawfully received by Buyer or the Buyer Authorized Designee from a party
other than Seller without an obligation of non-disclosure, excluding any such information that GTG purchased from VLPS pursuant to the Asset Purchase Agreement or which otherwise relates
primarily to the assets or business acquired by GTG from VLPS pursuant thereto. 

        (b)  In
addition to any confidentiality obligation imposed on Seller under the Asset Purchase Agreement, all Buyer Confidential Information (as defined below) hereafter
received by Seller and relating to or obtained from Buyer or its Affiliates shall be held in confidence by Seller to at least as great an extent and in at least the same manner as Seller protects its
own confidential or proprietary information but using no less than reasonable care. Except as otherwise required by law, Seller shall not disclose, publish, release, transfer or otherwise make
available Buyer Confidential Information in any form to, or for the use or benefit of, any person or entity without Buyer's prior written consent during the Term and for a period of three years
thereafter. "Buyer Confidential Information" for purposes of this Section 14(b) means all proprietary information (whether or not specifically labeled or identified as confidential), in any
form or medium, that is disclosed by Buyer or its agents or representatives to Seller in the performance of this Supply Agreement that relates to the business, products, services, research or
development of Buyer, its suppliers, distributors or customers. Buyer Confidential
Information includes the following: (i) internal business information (including information relating to strategic and staffing plans and practices, marketing, promotional and sales plans,
practices and programs, training practices and programs, cost, rate and pricing structures and accounting and business methods); (ii) identities of, individual requirements of, specific
contractual arrangements with, and information about, suppliers, distributors and customers and their confidential information, (iii) trade secrets, trade dress, ideas, inventions, designs,
developments, devices, methods, processes and systems (whether or not patentable or copyrighted and whether or not reduced to practice or fixed in a tangible medium), and (iv) the specific
terms and conditions of this Supply Agreement. Notwithstanding the foregoing, Buyer Confidential Information shall not include any information (i) that is publicly available other than through
the disclosure by Seller, (ii) that was previously known to Seller free of any obligation to keep it confidential, (iii) that was lawfully received by Seller from a party other than
Buyer without an obligation of non-disclosure, or (iv) that was purchased by GTG pursuant to the Asset Purchase Agreement or which otherwise relates solely to the assets or business
acquired by GTG from VLPS pursuant thereto. 

        (c)  If
a Person receives confidential information which is subject to the provisions of this Section 14 while such Person is a Buyer or Seller and such Person
discontinues being a Buyer or Seller, as the case may be, the confidentiality obligations of this Section 14 shall continue to apply to such Person for the remainder of the Term and three years
thereafter. If Buyer or Seller (or a previous Buyer or Seller) breaches the provisions of this Section 14, the party aggrieved thereby shall be entitled to specific performance and injunctive
or other equitable relief as a remedy for such breach and the breaching party (or its predecessor(s)) waives any requirement for the securing or posting of any bond in connection with such remedy.
Such remedy shall not be deemed to be the exclusive remedy for a breach of this Section 14, but shall be in addition to all other remedies available at law or in equity. 

        15.    Assignment.    Subject to the terms of this Section 15, neither Buyer nor Seller shall have the right to
assign or take or permit any action to be taken which results in an Assignment or other transfer any of its rights or obligations under this Supply Agreement except with the prior written consent of
the other. Notwithstanding the foregoing, subject to the limitations hereafter provided (and subject to the impact on the Applicable Multiplier), upon prior or contemporaneous written notice to the
other party (a) Buyer shall be entitled (without such prior written consent) to assign any or all of its rights and obligations hereunder to any Controlled Subsidiary of its Parent Entity if
and only if 

13

 

Buyer and such assignee shall be (and document to Seller's reasonable satisfaction that they are) jointly and severally liable to Seller for the performance of all obligations to Seller hereunder,
(b) Buyer shall be entitled (without such prior written consent) to assign all of its rights and obligations under this Supply Agreement to a purchaser of all or substantially all of the
business and assets of Buyer or in connection with a sale of all of the capital stock of Buyer or a Change in Control of Buyer's Parent Entity if and only if the purchaser of such business and assets,
purchaser of such stock or Person succeeding the Buyer's Parent Entity as a result of such Change in Control is not a Prohibited Participant and becomes liable (in a document reasonably acceptable to
Seller) for the performance of all obligations to Seller hereunder (the assignee pursuant to the first assignment by Buyer pursuant to this clause (b) is referred to herein as the "First Time
Assignee"), (c) Seller shall be entitled (without such prior written consent) to assign any or all of its rights and obligations hereunder to any of its Affiliates if and only if Seller and
such assignee shall be (and document to Buyer's reasonable satisfaction that they are) jointly and severally liable to Buyer for the performance of all obligations to Buyer hereunder, and
(d) Seller shall be entitled (without such prior written consent) to assign all of its rights and/or obligations under this Supply Agreement to a purchaser of all or substantially all of the
business of Seller or in connection with a sale of all of the capital stock of Seller or a Change in Control of Seller if and only if the purchaser of such business and assets, purchaser of such stock
or Person succeeding Seller (or its successor) as a result of such Change in Control is not primarily engaged in the lighting products rental business and becomes liable (in a document reasonably
acceptable to Buyer) for the performance of all obligations to Buyer hereunder. Notwithstanding anything in this Supply Agreement to the contrary, unless Seller consents otherwise (which consent may
be granted or withheld by Seller in its sole discretion), the first and all subsequent assignees of the First Time Assignee and each subsequent assignee shall not be entitled to any payment pursuant
to Section 4 or Annex I to this Supply Agreement with respect to any Paid Purchases of Products in excess of the Permitted Amount. Any Assignment not expressly authorized by this
Section 15 is prohibited and shall be null and void. 

        16.    Captions.    Captions and section headings used herein are for convenience only and are not a part of this
Supply Agreement and shall not be used in construing this Supply Agreement. 

        17.    Notices and Other Communications.    Any notice required to be given pursuant to this Supply Agreement shall be
in writing, which may include telecopy or other electronic transmission reduced to written form. Notice given by telecopy or other electronic transmission shall be deemed to have been given and
received when sent. Notice by mail shall be deemed to have been given and received four calendar days after the day first deposited in the United States mail, certified mail, first class postage
prepaid, return receipt requested, and as addressed as shown below. Notices by overnight courier service shall be deemed to have been given and received the day after they are sent. All notices shall 

14

 

be to the following addresses, unless changed in writing pursuant to this Section 17 by the respective addressee: 

	If to Buyer:	 	VLPS Lighting Services, Inc.

201 Regal Row

Dallas, Texas 75247

Attn: H.R. Brutsché III
	

with a copy (which shall not constitute notice) to:
	

 	
 	

Gardere Wynne Sewell LLP

3000 Thanksgiving Tower

1601 Elm Street

Dallas, Texas 75201

Attn: Alan J. Perkins

Telecopier: (214) 999-3683
	

If to Seller:	
 	

Genlyte Controls Division

2413 Shiloh Road

Garland, Texas 75041

Attn: Steve Carson
	

with a copy (which shall not constitute notice) to:
	

 	
 	

Genlyte Thomas Group, LLC

10350 Ormsby Park Place

Suite 601

Louisville, Kentucky 40223

Attn: Dan Fuller

        18.    Entire Agreement.    This Supply Agreement constitutes the full understanding of the parties, a complete
allocation of risks between them and a complete and exclusive statement of the terms and conditions of their agreement relating to the subject matter hereof and supersedes any and all prior
negotiations, understandings and agreements, whether written or oral, between the parties with respect thereto. 

        19.    Amendments; Waivers.    

        (a)  This
Supply Agreement shall not be deemed or construed to be modified, amended, rescinded or canceled, in whole or in part, except by written amendment signed by the
parties hereto. 

        (b)  No
waiver by either party of any breach of the covenants set forth herein or any claim, right or remedy provided for hereunder and no course of dealing shall be deemed a
waiver of the same or any other breach, claim, right or remedy, unless, and then only to the extent, such waiver is in writing and is signed by the party sought to be bound. The failure of a party to
assert or exercise any claim, right or remedy shall not be deemed a waiver of such claim, right or remedy in the future. 

        20.    Force Majeure.    Any delays in or failure of performance of either party, other than delay in or failure to
make any payment required by this Supply Agreement or honor a claim for indemnification of a third-party claim, shall not constitute a default hereunder or give rise to any claims for damages if, to
the extent that, and for such period that such delays or failures of performance are caused by the following occurrences or circumstances (but only to the extent such occurrences or circumstances are
beyond the reasonable control of the party not in compliance): acts of God or the public enemy, expropriation or confiscation of facilities, compliance with any duly promulgated law, order or
regulation of any governmental authority, acts of war, rebellion or sabotage or damage 

15

 

resulting therefrom, fires, floods, explosion, riot, strikes, unavailability of any products or materials needed to manufacture any products, work stoppages, slow downs or other occurrences or
circumstances beyond the reasonable control of such party. 

        21.    Governing Law; Venue.    This Supply Agreement shall be governed by, and interpreted and construed in
accordance with, the laws of the State of Texas, without reference to the conflict of laws principles of any jurisdiction. The parties hereto hereby irrevocably and unconditionally submit to the
exclusive jurisdiction of the state and federal courts located in or having jurisdiction over the State of Texas, for any actions, suit or proceedings arising out of or relating to this Supply
Agreement and the transactions contemplated hereby (and the parties hereto agree not to commence any action, suit or proceeding relating thereto except in such courts), and further agree that service
of any process, summons, notice or document by United States registered mail to its address set forth above shall be effective service of process of any action, suit or proceeding brought against it
in any such court. The parties hereto hereby irrevocably and unconditionally waive any objection to the laying of venue of any action, suit or proceeding arising out of this Supply Agreement or the
transactions contemplated hereby in such state or federal courts as aforesaid and hereby further irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such
action, suit or proceeding brought in any such court has been brought in an inconvenient forum. 

        22.    Dispute Resolution    

        (a)  As
used in this Section 22, "Dispute" means a claim or controversy arising out of or relating to this Supply Agreement, including the interpretation, breach,
termination or invalidity thereof, and whether arising out of tort or contract, government statute, regulation or other applicable law, but not including any dispute to be resolved as provided in
Annex I hereto. 

        (b)  If
a Dispute exists between the parties, each party will appoint an executive management representative to resolve such Dispute. Such representatives will negotiate in
good faith to resolve the Dispute within 30 days without the necessity of any formal proceeding. The parties hereby waive the applicable statute of limitations during such 30-day
period, the same being tolled for such period. Except where clearly prevented by the nature of the Dispute, both parties shall continue performance of this Supply Agreement during such 30 days
or for as long as the parties may mutually agree, unless and until this Supply Agreement is terminated in accordance with its terms. Nothing contained in this Section 22(b) shall affect either
party's right to deliver notice of a default pursuant to Section 12. 

        (c)  If
any Dispute is not settled by the informal procedures outlined in Section 22(b), such Dispute shall, as a condition precedent to any filing of legal action, be
mediated by the parties. The mediation shall be conducted in Dallas, Texas. The parties shall mutually agree upon a mediator, and shall schedule and conduct a mediation at a mutually convenient time
and place. If the parties cannot agree upon a mediator, each party shall select one mediator and the two mediators so selected shall select the mediator who shall conduct the mediation hereunder. Each
party shall bear its own costs, fees and expenses associated with such mediation, except that the parties shall split equally the costs and expenses of the mediator and the conduct of the mediation
itself. 

        23.    Severability.    If any provision of this Supply Agreement or the application thereof to any person, entity or
circumstance shall be held invalid or unenforceable to any extent, the remainder of this Supply Agreement and the application of such provision to such or other persons, entities or circumstances
shall not be affected thereby and shall be enforced to the greatest extent permitted by law. Furthermore, in lieu of such void or unenforceable clause(s), there shall be added automatically as a part
of this Supply Agreement a clause as similar in terms to such void or unenforceable clause(s) as may be possible, valid and enforceable. 

16

 

        24.    Counterparts; Interpretation.    

        (a)  This
Supply Agreement may be executed in counterparts, each of which shall be deemed an original for all purposes, and all of which together shall constitute one and the
same instrument. 

        (b)  All
references to "Section" or "Sections" refer to the corresponding section or sections of this Supply Agreement. All references to "hereunder" refer to under or
pursuant to this Supply Agreement. All words used in this Supply Agreement will be construed to be of such gender or number as the circumstances require. Unless otherwise expressly provided, the word
"including" does not limit the preceding words or terms. 

        25.    Enforceability; No Third-Party Beneficiary.    This Supply Agreement shall be enforceable by and against VLPS
and GTG and their respective expressly permitted successors and expressly permitted assignees. No person not a party hereto shall be a third-party beneficiary of this Supply Agreement. 

        [The signature page is the next following page.]

17

 

        This
Supply Agreement is executed and delivered by the parties hereto as of the date first set forth above. 

	 	 	GENLYTE THOMAS GROUP LLC
	

 	
 	

By:	

/s/  STEVEN R. CARSON      
 Steven R. Carson
 Vice President and General Manager of the Genlyte Controls
Division
	

 	
 	

VLPS LIGHTING SERVICES, INC.
	

 	
 	

By:	

/s/  H.R. BRUTSCHÉ III      
 H.R. Brutsché III, Chairman

 
 

GUARANTY    
  

        The undersigned hereby guarantees the performance by VLPS Lighting Services, Inc., a Delaware corporation formerly known as
Vari-Lite, Inc., and each Controlled Subsidiary (as defined in this Supply Agreement) of the undersigned of each of their existing and future obligations under this Supply
Agreement, and agrees that the provisions of Sections 21 and 22 apply to this guarantee. 

	 	 	VARI-LITE INTERNATIONAL, INC.
	

 	
 	

By:	

/s/  H.R. BRUTSCHÉ III      
 H.R. Brutsché III, Chairman
	

 	
 	

November 18, 2002

18

  

 
 

ANNEX I
  REBATES    
  

        1.    Subject
to the limitations and provisions hereafter provided and those provided in the Supply Agreement, Seller shall pay Buyer a rebate with respect to Paid Purchases of
Products (reduced by the amount of Paid Purchases of Products whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a manner as to
constitute an Excluded Sale(s)) purchased under the Supply Agreement to which this is attached (the "Supply Agreement") and Delivered by Seller pursuant to the Supply Agreement
************************************************** ***************************************************************************************************
*************************************************************************************************** ***************************************************************************************************
*************************************************************************************************** *********************************************. Notwithstanding anything herein to the contrary, if
including the purchase of any particular Product in the computation of a rebate hereunder would reduce the aggregate rebate that would be payable but for the inclusion of the purchase of such Product,
the purchase of such Product shall be excluded from the computation of the rebate (although such purchase shall be included for purposes of Section 2 below). The defined terms in the Supply
Agreement shall have the meanings in this Annex that such terms have in the Supply Agreement and this Annex shall in all respects be deemed to be a part of the Supply Agreement. Buyer will promptly
report to Seller any and all Excluded Sales and, in the event Seller pays or has paid any amounts as rebates with respect to Excluded Sales, the Buyer will promptly repay such amounts to Seller on
demand from Seller. ******************************************** **************************************************************************************************
************************************************************************************************** **************************************************************************************************. 

        2.    Buyer
will not be entitled to any rebate with respect to 2003 unless the total Paid Purchases for all Products (reduced by the amount of Paid Purchases of Products
whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)) purchased under the Supply Agreement
in 2003 equals or exceeds U.S.$5,000,000. Buyer will not be entitled to any rebate with respect to 2004 unless the total Paid Purchases for all Products (reduced by the amount of Paid Purchases of
Products whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a
manner as to constitute an Excluded Sale(s)) purchased under the Supply Agreement in 2004 equals or exceeds U.S.$5,500,000. 

        3.    (a)
Subject to the provisions of Section 3(b) below, (i) the FAC for each Product shall be determined by Seller (in accordance with Section 3(b) and
(c) below) and, without duplication, shall be equal to (A) the material cost, plus (B) the direct labor cost, plus (C) the factory overhead cost allocable to such Product,
plus (D) any royalties paid by Seller to any Person that is not an Affiliate of Seller that are applicable to such Product, and (ii) the factory overhead cost allocable to each Product
shall be equal to the direct labor cost allocable to such Product multiplied by the factory overhead rate ("FOR") allocable to such Product, as determined by Seller in accordance with
Section 3(b) or (c) below. 

1

 

        (b)  The
FAC of each Product sold through June 30, 2003 shall be determined, without duplication, in accordance with the following methodology (with such modifications
as Seller reasonably determines appropriate): 

        Material
Cost: 

Material
Cost will represent (i) Seller's standard material costs based upon the anticipated price Seller would pay in acquiring or replacing the material through June 2003 times
(ii) 1.04 (to cover scrap, freight-in, floor stock and miscellaneous shipping material). 

        Labor: 

Labor
will be based upon Seller's budgeted standard labor rate for 2003 with labor hours set at VLPS's 2002 rates, approximately U.S.$7.90/hour. 

        Overhead:

Overhead
will be calculated as (i) Labor (above) multiplied times (ii) Seller's standard overhead rate which will be the same as the overhead rate used on Division Products
(approximately 500% or 5). 

The
final FAC will be determined using the above values in the following formula: 

FAC =
Material Cost + Labor + Overhead 

In
July 2003, the Buyer and Seller will review the FACs determined as described above and, if the actual or projected costs (determined by Seller in accordance with Section 3(c) below)
vary by more than 10% from the amounts used through June 30, 2003, the FACs will be adjusted up or down effective July 1, 2003, for Products sold during the remainder of 2003; otherwise,
the FAC for Products shall remain unchanged for the balance of 2003. For all Product sales during each calendar year beginning in 2004, the FAC for each Product will be determined or estimated by
Seller (in accordance with Section 3(c) below) not later than November 30 of the preceding year. 

        (c)  All
determinations by Seller of the FAC for each Product shall be made in good faith and, except as provided otherwise in Section 3(b) above, shall be based
Seller's books and records maintained in accordance with generally accepted and consistently applied accounting principles, as normally applied by Seller. Seller's determination of the FOR allocable
to each Product will, except as provided otherwise in Section 3(b) above, be based on Seller's estimate of indirect costs that are properly allocable to the manufacture of such Product. Seller
shall determine or estimate the FOR for the Products in a fair and reasonable manner, consistent with its determination thereof for Division Products. Notwithstanding anything contained herein to the
contrary, if there is ever an extraordinary change in the costs incurred or which will be incurred by Seller from those used in establishing any FAC, Seller shall, except as hereafter otherwise
provided, after Seller learns of such change and its impact on this provision, adjust the FAC on a prospective basis (until the next change is to take place and be effective) so that Seller is neither
positively or negatively impacted by such change (taking into account the timing of the change(s) in costs incurred and/or to be incurred); provided, however, (i) a change shall be deemed to be
extraordinary if and only if the impact is to cause the FAC for any such Product expected to be produced prior to the time the next change is to take place and be effective to be more than 10% higher
or lower than the amount then being used and (ii) a change shall not take effect until the date reasonably established by Seller in a notice to Buyer which shall be at least ninety
(90) days after the date of such notice by Seller to Buyer. 

        (d)  Seller
will deliver to Buyer a notice setting forth the FACs and the FORs determined by it pursuant hereto on each occasion that FACs and FORs are determined under
Section 3(c) hereof. Such notice shall be accompanied by reasonably detailed calculations and estimates showing how the FACs and FORs were calculated. 

2

 

        (e)  Buyer
will, upon reasonable notice to Seller, have the right to have audited Seller's determination of its FACs and FORs for the Products (and nothing else, except that
the audit may include such review of the FACs and FORs for Division Products as may be necessary to confirm Seller has complied with its obligations under this Annex) once with respect to each
calendar year in the manner provided below. Buyer's audit right for each calendar year will expire unless Buyer delivers to Seller by March 31
of the year following the year to be audited notice of Buyer's intent to conduct an audit. With respect to each such audit: 

        (i)    Buyer
shall select a reputable, independent firm of certified public accountants which shall be reasonably acceptable to Seller (the "Buyer Auditor") to conduct the
audit. Upon receipt of reasonable prior notice, Seller shall cooperate fully and completely in responding to reasonable questions and requests for information (including, if requested and reasonable,
permitting the Buyer Auditor to have full access to all books and records of Seller related to the determination of the FACs or FORs being audited and any relevant accountants' work papers prepared in
determining such FACs or FORs) submitted by the Buyer Auditor. However, the analysis by the Buyer Auditor will be limited to the Products only and confirming whether Seller complied with the
provisions of Sections 3(a), (b) and (c) above in the determination of the FACs and the FORs. 

        (ii)  If,
following an audit, the Buyer Auditor determines that any of the FACs or FORs applied by Seller were not correct, based on the methodology and analysis to be
applied pursuant to this Section 3, Buyer shall deliver written notice thereof to Seller, together with a statement setting forth the Buyer Auditor's calculations of the correct FACs or FORs.
Within 15 days of the receipt of any such notice, Seller shall advise Buyer in writing that it either accepts or does not accept the calculations submitted by the Buyer Auditor. 

        (iii)  If
Seller and Buyer cannot agree on any FAC or FOR calculation within 10 days of the date the Buyer Auditor delivers its calculations to Seller, Seller and
Buyer will select an independent auditor who is a certified public accountant to finally determine as quickly as possible the FAC and FOR calculations. If Buyer and Seller cannot agree on the
independent auditor the independent auditor will be determined as the "Accountants" are determined under the Asset Purchase Agreement. Seller and Buyer shall share the costs of the independent auditor
equally and the decision of the independent auditor shall be binding. 

        (iv)  ******************************************************************************************
************************************************************************************************** **************************************************************************************************
*************************************************************************************************. 

        4.    Rebates
shall be paid by Seller to Buyer within 60 days of the close of each calendar quarter with respect to Paid Purchases of Products (reduced by the amount of
Paid Purchases of Products whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)) during
such quarter. For rebates payable with respect to 2003 and 2004, if, as of the end of any calendar quarter, the annualized Paid Purchases of Products (reduced by the amount of Paid Purchases of
Products whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)) for that calendar year
(computed based upon all Paid Purchases of Products, less all Excluded Sales, during that year through the end of such quarter) would not satisfy the required annual minimum volume for Buyer to be
entitled to a rebate in that calendar year as
provided above, then the rebate otherwise payable for such quarter shall be deferred until the earlier to occur of the following: (i) 60 days following the end of the next calendar
quarter in that year, if any, with respect to which the annualized Paid Purchases of Products (reduced by the amount of Paid Purchases of Products whether during or prior to the applicable period, to
the extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)) determined as 

3

 

provided above through the end of such quarter would meet the required annual minimum, or (ii) 60 days following the end of such calendar year. If Seller pays any quarterly rebates for
2003 or 2004 and, based on actual Paid Purchases of Products (reduced by the amount of Paid Purchases of Products whether during or prior to the applicable period, to the extent of the Products which
are or have been sold in such a manner as to constitute an Excluded Sale(s)), Buyer is not entitled to such rebates because its Paid Purchase of Products (reduced by the amount of Paid Purchases of
Products whether during or prior to the applicable period, to the extent of the Products which are or have been sold in such a manner as to constitute an Excluded Sale(s)) do not satisfy the required
minimum applicable to such year or for any other reason, then Buyer shall promptly repay to Seller any such rebate paid with respect to such year. Not later than 60 days after the close of each
calendar quarter during the Term, Seller will deliver to Buyer a document reflecting the calculations (in reasonable detail) used by Seller in determining the rebate, if any, which is owed pursuant to
this Supply Agreement. Such calculations shall be shown in such report in sufficient detail to enable Buyer to reasonably determine the accuracy thereof. 

4

 
 

Exhibit A
  
    European Market    
  

QuickLinks

Exhibit 10.89

SUPPLY AGREEMENT

WITNESSETH

GUARANTY

ANNEX I REBATES

Exhibit A European MarketQuickLinks
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Exhibit 10.90    
  

 
 

AMENDMENT NO. 7
  TO
  FINANCING AGREEMENT    
  

        THIS AMENDMENT NO. 7 TO FINANCING AGREEMENT (this "Amendment") is made and entered into as of the 31st day of December, 2002, by and between VLPS LIGHTING
SERVICES, INC. (formerly known as "Vari-Lite, Inc."), a Delaware corporation ("Borrower"), and U.S. BANK NATIONAL ASSOCIATION (formerly known as "Firstar Bank, National
Association") ("Bank"). 

WITNESSETH:

        WHEREAS,
Borrower and Bank have heretofore entered into that certain Financing Agreement dated as of December 29, 2000, as amended by that certain Amendment No. 1 to
Financing Agreement dated as of March 30, 2001, Amendment No. 2 to Financing Agreement dated as of June 30, 2001, Amendment No. 3 to Financing Agreement dated as of
December 31, 2001, Amendment No. 4 to Financing Agreement dated as of March 31, 2002, Amendment No. 5 to Financing Agreement dated as of June 30, 2002, and Amendment
No. 6 to Financing Agreement dated as of November 18, 2002 (as so amended, the "Financing Agreement"), pursuant to which Bank has made loans and financial accommodations available to
Borrower in the aggregate principal amount of up to $24,500,000, consisting of a Revolving Loan Facility, a Term Loan A Facility and a CapEx Term Loan Facility; and 

        WHEREAS,
Borrower and Bank desire to amend the Financing Agreement to reflect the elimination of the Term Loan A Facility and the CapEx Term Loan Facility, to reduce the Total Facility
to a principal amount of up to $7,500,000 consisting of the Revolving Loan Facility and a new Letter of Credit Subfacility, and to effect such other changes as are hereinafter set forth; 

        NOW,
THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower and Bank hereby
agree as follows: 

        1.    The
following definitions in Section 1.1 of the Financing Agreement are amended and restated in their entirety to provide as follows: 

"Applicable LIBOR Rate Margin" means a rate equal to 2.25% per annum. 

"Applicable Prime Rate Margin" means a rate equal to 0.50% per annum. 

"Permitted Payments" means the following payments, regardless of whether classified as dividends, distributions, stock redemptions or payments of
Intercompany Loans: 

	(a)
	payments
to International in an amount not to exceed International's consolidated tax liability attributable to the net income of Borrower in any fiscal year of Borrower; and

	(b)
	so
long as no Event of Default has occurred which is continuing:

	(i)
	payments
of interest at a market rate to Vari-Lite Asia, Inc. on Intercompany Loans from Vari-Lite Asia, Inc. to
Borrower;

	(ii)
	payments
to International to cover certain employment, compensation, audits, director fees, legal and other overhead and administrative expenses not to
exceed One Million Dollars ($1,000,000) in the aggregate in any fiscal year of Borrower; and

	(iii)
	other
payments: 

(A)  not
in excess of $1,500,000 during Borrower's fiscal year ending September 30, 2003; 

 

(B)  in
any fiscal quarter following receipt pursuant to Section 8.8 of Borrower's financial statements for its fiscal year ending September 30, 2003, in such amount as
Borrower shall determine, provided that after giving effect to any such payment: (x) Borrower's Fixed Charge Coverage Ratio calculated as of the end of the immediately preceding quarter on a
pro forma basis (including in Fixed Charges for this purpose, however, only such Permitted Payments as have been made pursuant to this clause (B) during the immediately preceding three
(3) fiscal quarters plus the Permitted Payment in question and exclusive of any Permitted Payment or portion thereof made or to be made pursuant to clause (C) below) exceeds 1.35:1.0 and
(y) Borrower will have Adjusted Revolving Loan Availability of at least $1,500,000; and 

(C)  in
addition to Permitted Payments under clause (B) above, following receipt pursuant to Section 8.8 of Borrower's financial statements for any fiscal year ending on or
after September 30, 2004, in such amount as Borrower shall determine, provided that after giving effect to any such payment: (x) Borrower's Fixed Charge Coverage Ratio calculated as of
the end of such fiscal year on a pro forma basis inclusive of such payment but exclusive of any payments made during such fiscal year pursuant to this clause (C) based upon the prior fiscal
year's Fixed Charge Coverage Ratio shall not be less than 1.25:1.0 and (y) Borrower will have Adjusted Revolving Loan Availability of at least $1,500,000. 

For
purposes of this definition, the term "Adjusted Revolving Loan Availability" shall mean Revolving Loan Availability after deducting Borrower's accounts payable exceeding sixty (60) days and
Borrower's book overdraft. 

"Revolving Loan Availability" means, as at any time, an amount, in Dollars, equal to: 

	(i)
	an
amount equal to the lesser of: (a) the then Revolving Loan Borrowing Base or (b) $7,500,000.00; 

less (ii) the then aggregate outstanding principal amount of all Revolving Loans and all due but unpaid interest on the Loans, and all fees,
commissions, expenses and other charges posted to Borrower's loan account with Bank; and 

less (iii) the then Letter of Credit Reserve. 

"Revolving Loan Borrowing Base" shall mean an amount equal as at any time to the sum of (i) up to eighty percent (80%) of the net amount of
Borrower's Eligible Receivables (the "Eligible Receivables Advance Rate"), plus (ii) up to fifty percent (50%) of the value of Borrower's
Eligible Inventory (the "Eligible Inventory Advance Rate"), valued at the lower of cost or market value, determined on a first-in-first-out basis, consistently
applied, plus (iii) up to fifty percent (50%) of the value of Borrower's Rental Inventory (the "Rental Inventory Advance Rate"), valued at its
"Appraised Liquidation Value", minus (iv) the Reserve Amount then in effect. For purposes of this Agreement, the "Appraised Liquidation Value" of
Rental Inventory shall mean its orderly liquidation value as determined annually on behalf of Bank at Borrower's expense, which amount, pending the annual appraisal, shall be adjusted from time to
time to reflect (x) the deduction of a monthly amount based upon a 48-month, straight-line amortization, (y) the deduction of the net book value of items disposed
of, and (z) the addition of newly acquired items at their cost. 

2

 

        2.    Section 1.1
of the Financing Agreement is amended by adding the following new definitions: 

"Letter of Credit" means a Standby Letter of Credit (as defined in Section 2.4) or a Commercial
Letter of Credit (as defined in Section 2.4) issued by Bank pursuant to Section 2.4. 

"Letter of Credit Availability" means, as at any time, an amount equal to the lesser of (i) an
amount equal to (a) $500,000.00 less (b) the then Letter of Credit Exposure and (ii) the then Revolving Loan Availability. 

"Letter of Credit Deficiency" means any failure of the Letter of Credit Availability to be greater than or equal to zero Dollars. 

"Letter of Credit Documents" means, with respect to each and every Letter of Credit, (i) a letter of credit application and reimbursement
agreement on Bank's then customary form (the "Letter of Credit Application") and (ii) any other agreements, certificates, documents and
information as Bank may reasonably request relating to a Letter of Credit. 

"Letter of Credit Exposure" means, as at any time, the sum of (i) the Letter of Credit Face Amount of all outstanding Letters of Credit and
(ii) all unreimbursed drawings under any Letters of Credit (whether or not outstanding). 

"Letter of Credit Face Amount" of any Letter of Credit means, at any time, the face amount of the Letter of Credit, after giving effect to all drawings
paid thereunder and other reductions of the face amount and to all reinstatements of the face amount effected, pursuant to the terms of the Letter of Credit, prior to such time. 

"Letter of Credit Obligations" means, at any time, the sum of (i) the aggregate Letter of Credit Face Amount for all Letters of Credit  plus (ii) the
aggregate amount of Borrower's unpaid obligations in respect of all Letters of Credit (whether or not outstanding) under this
Agreement and the Letter of Credit Documents, including any Indebtedness incurred or arising in connection with any Letters of Credit (including any drafts or acceptances thereunder, all amounts
charged or chargeable to Borrower or by Bank, including any and all Bank charges, expenses, fees and commissions, and all duties and taxes and costs of insurance which may pertain either directly or
indirectly to such Letters of Credit). 

"Letter of Credit Reserve" means, as at any time, the sum of (i) 100% of the then Letter of Credit Exposure with respect to all Standby Letters
of Credit and (ii) that percentage which is equal to 100% minus the applicable Inventory Advance Rate (Eligible or Rental) of the then Letter of Credit Exposure with respect to all Commercial
Letters of Credit. 

        3.    Section 2.1
of the Financing Agreement is amended and restated in its entirety to provide as follows: 

	2.1
	Total Facility. Subject to the terms and conditions of this Agreement, Bank will make up to $7,500,000.00 in total credit (the
"Total Facility") available to, or for the benefit of, Borrower in the form of the following loans advanced or to be made under the following
facilities: (i) revolving loans, and (ii) a letter of credit subfacility, all as more particularly described below (the "Loans"). 

        4.    Section 2.3
of the Financing Agreement is deleted and shall remain intentionally blank. 

3

 

        5.    Section 2.4
of the Financing Agreement is deleted and shall be replaced with the following provisions: 

	2.4
	Letters of Credit.

        2.4.1  Letter of Credit Subfacility. Until the termination of this Agreement pursuant to  Section 11 and subject to the other terms and conditions of this
Agreement, Borrower may request Bank to issue one or more of its standby letters
of credit ("Standby Letter of Credit") or its commercial letters of credit ("Commercial Letter of
Credit") in favor of such beneficiary(ies) as are designated by Borrower by delivering to Bank: (i) a Letter of Credit Application completed to the satisfaction of Bank,
together with the proposed form of the Letter of Credit (which, in all respects, will comply with the applicable requirements of Section 2.4.2),
(ii) a Borrowing Base Certificate (as defined in Section 8.3) which calculates the Letter of Credit Availability after giving effect to
the proposed Letter of Credit, and (iii) such other Letter of Credit Documents that Bank then requires. Bank, in addition to the other terms of this Agreement, will have no obligation to issue
the proposed Letter of Credit if, after giving effect to such proposed Letter of Credit, the Letter of Credit Availability will be less than zero Dollars. The making of each Letter of Credit request
by Borrower will be deemed to be a representation by Borrower that the Letter of Credit may be issued in accordance with, and will not violate the terms of, this  Section 2.4.1. 

        2.4.2  Terms of Letter of Credit. Each Letter of Credit issued under this Agreement will, among other things,
(i) be in such form requested by Borrower as is acceptable to Bank in its discretion exercised in good faith, (ii) be denominated in Dollars, Euros, Great British Pounds, or such other
foreign currency as is acceptable to Bank in its discretion exercised in good faith, and (iii) be issued to support Borrower's obligations that finance its business needs incurred in the
ordinary course of Borrower's business as presently conducted by it (and, in the case of Commercial Letters of Credit, solely in support of the purchase of Eligible Inventory or Rental Inventory). In
no event will any Standby Letter of Credit have a term of more than one year or any Commercial Letter of Credit have a term of more than 180 days; furthermore, and, in addition to the foregoing
term limitation, Bank will have no obligation to issue any Letter of Credit with an expiry date later than the earlier of (a) December 31, 2005 or (or such later date to which Bank
renews the termination date of this Agreement as provided in Section 11.2) or (b) such earlier termination date of this Agreement which
has resulted from the delivery to Bank by Borrower of a Termination Notice as provided in Section 11.3. 

        2.4.3  Advice of Issuance or Non-Issuance. Upon receipt of a request from Borrower to open any
Letter of Credit and of all attendant Letter of Credit Documents satisfactorily completed, Bank, within three Business Days, may either (i) issue the requested Letter of Credit to the
beneficiary thereof and transmit a copy to Borrower, or (ii) elect, in its discretion exercised in good faith, not to issue the proposed Letter of Credit. If Bank elects not to issue such
Letter of Credit, Bank will communicate in writing to Borrower the reason(s) why Bank has declined such request. 

        2.4.4  Payment of Drafts. All obligations of Borrower under each Letter of Credit and all Letter of Credit
Documents are payable on Bank's demand or payable as otherwise set forth in the applicable Letter of Credit Documents. Subject to the terms of  Section 13.3, Borrower hereby irrevocably instructs
Bank, on the same Business Day that Bank is obligated to fund a drawing or make any
expenditure or any other payment under a Letter of Credit or incurs any cost or expense under any Letter of Credit, to reimburse Bank for any drawing, expenditure or other payment made, or cost or
expense incurred, by Bank in respect of any Letter of Credit by debiting Borrower's loan account with Bank as an advance of the Revolving Loans 

4

 

pursuant to Section 2.2 as a Prime Rate Loan. If the advance of a Revolving Loan to reimburse Bank for any drawing, expenditure or other payment
made, or cost or expense incurred, by Bank in respect of any Letter of Credit results (or to the extent that it results) in any Deficiency, then Borrower will immediately eliminate any Deficiency in
accordance with the terms of Section 2.10. 

        2.4.5  Letter of Credit Obligations. All Letter of Credit Obligations will constitute part of the Obligations
and be secured by the Loan Collateral. 

        6.    Section 2.5
of the Financing Agreement is amended and restated in its entirety to provide as follows: 

	2.5
	Voluntary Prepayments. Borrower shall have the right to prepay at any time the Revolving Loans in whole or part without premium or
penalty (except as provided in Section 3.4): 

Whenever
the Borrower desires to prepay any part of the Revolving Loans, it shall provide a prepayment notice to Bank at least two (2) Business Days prior to the date of prepayment of such
Revolving Loans which are LIBOR Rate Loans and on or before 12:00 noon on the date of prepayment of such Revolving Loans which are Prime Rate Loans setting forth the following information: 

(y)  the
date, which shall be a Business Day, on which the proposed prepayment is to be made; and 

(z)  the
total principal amount of such prepayment, which shall not be less than One Hundred Thousand Dollars ($100,000). 

All
prepayment notices shall be irrevocable. The principal amount of the Revolving Loans for which a prepayment notice is given, together with interest on such principal amount, shall be due and
payable on the date specified in such prepayment notices as the date on which the proposed prepayment is to be made. If the Borrower prepays a Revolving Loan but fails to specify the applicable
Revolving Loans which the Borrower is prepaying, the prepayment shall be applied first to Revolving Loans which are Prime Rate Loans and then to Revolving Loans which are LIBOR Rate Loans. Any
prepayment hereunder shall be subject to the Borrower's Obligations to indemnify the Bank under Section 3.4. 

        7.    Section 2.8
of the Financing Agreement is deleted and shall remain intentionally blank. 

        8.    Section 2.12(a)
of the Financing Agreement is amended and restated in its entirety to provide as follows: 

	(a)
	Changes. Borrower acknowledges that Bank, from time to time, may do any one or more of the following in its discretion exercised in
good faith: (i) decrease the dollar limits on outstanding advances against the Revolving Loan Borrowing Base or applicable to any one or more Inventory or Receivables advance sublimits or
(ii) decrease the Eligible Receivables Advance Rate or the Eligible Inventory Advance Rate or the Rental Inventory Advance Rate (collectively, the "Advance Rates") if one or more of the
following events occur or conditions exist: (a) an Event of Default has occurred; (b) with regard to the Eligible Receivables Advance Rates, (1) the dilution percentage with
respect to Borrower's Eligible Receivables (i.e., reductions in the amount of accounts receivable because of returns, discounts, price adjustments,
credit memoranda, credits, contras and other similar offsets) increases by an amount which Bank, in good faith, has determined is materially above that which existed as of December 31, 2002,
(2) the percentage of accounts receivable which are 90 days or more past the date of the original invoices applicable thereto increases, in comparison to the percentage of accounts
receivable which are within 90 days from the date of the original invoices applicable thereto, by an 

5

 

amount
which Bank, in good faith, determines is material, or (3) any material change occurs, determined by Bank in good faith, from December 31, 2002, in respect of the credit rating or
credit quality of Borrower's account debtors; (c) with respect to the Eligible Inventory Advance Rate, there occurs a material change, as determined by Bank in its discretion exercised in good
faith, in the type, quantity, or quality of Borrower's Eligible Inventory as the same is constituted on December 31, 2002, or (d) with respect to the Rental Inventory Advance Rate, there
occurs a material change, as determined by Bank in its discretion exercised in good faith, in the type, quantity, or quality of Borrower's Rental Inventory as the same is constituted on
December 31, 2002. 

        9.    Section 3.8
of the Financing Agreement is deleted and shall remain intentionally blank. 

        10.  The
following is added as a new Section 3.13 to the Financing Agreement: 

	3.13
	Letter of Credit Fees. Borrower will pay to Bank, with respect to each Letter of Credit, a fee
("LOC Fee") equal to 0.375% per annum on the amount available to be drawn under each Letter of Credit from, and including, the issuance date of the
Letter of Credit to and including the expiry date thereof (or, if earlier, the date on which the Letter of Credit is returned to Bank and is canceled). In addition, Borrower will pay to Bank, on its
demand for payment, Bank's then current issuance, opening, closing, transfer, amendment, draw, renewal, negotiation and other letter of credit administration fees, charges and out of pocket expenses
with respect to each Letter of Credit. The LOC Fee is fully earned by Bank when paid and will be due and payable (a) in advance on the issuance of each Commercial Letter of Credit and
(b) in respect of each Standby Letter Credit, monthly in arrears based on the amount available to be drawn under each Standby Letter of Credit during the previous calendar month, payable on the
first (1st) day of each calendar month, commencing with the first calendar month occurring after the calendar month in which the Standby Letter of Credit is issued, and on the date this Agreement is
terminated as provided in Section 11. 

        11.  Section 10.22
of the Financing Agreement is amended and restated in its entirety to provide as follows: 

	10.22 	Redemption of Stock. Borrower will not voluntarily or pursuant to any contractual or other obligations redeem, retire, purchase, repurchase or otherwise acquire, directly or indirectly, or
exercise any call rights relating to, any of Borrower's capital stock or any other equity securities now or hereafter issued by Borrower (including, without limitation, any warrants for stock of Borrower), except to the extent any of the foregoing
constitute Permitted Payments.

        12.  The
second sentence of Section 11.1 of the Financing Agreement is amended and restated in its entirety to provide as follows: 

Unless
otherwise terminated or extended in accordance with the provisions of this Section 11, this Agreement shall terminate on
December 31, 2005. 

        13.  Section 11.3
of the Financing Agreement is amended and restated in its entirety to provide as follows: 

	11.3
	Voluntary Termination by Borrower. Borrower may terminate this Agreement (i) by giving Bank
written notice ("Termination Notice") of the date on which this Agreement is to terminate ("Voluntary Termination
Date") at least ten (10) Business Days before the Voluntary Termination Date, and (ii) by paying on any such Voluntary Termination Date (a) all of the
Obligations, (b) any amounts payable under Section 3.4, and (c) as 

6

 

compensation
to Bank for loss of bargain with respect to the credit advanced hereunder, and not as a penalty, a termination fee in amounts as set forth below: 

	Voluntary Termination Date
	 	Termination Fee

	On or Before December 31, 2003	 	Two Percent (2%) of the Total Facility;
	

After December 31, 2003 but on or before December 31, 2004	
 	

One and One-Fourth Percent (1.25%) of the Total Facility;
	

Between January 1, 2005 and September 30, 2005 (inclusive)	
 	

Three-Fourths Percent (0.75%) of the Total Facility;

provided, however, that no termination fee shall be due if: (1) the Voluntary Termination Date is on or after October 1, 2005, or
(2) in response to an Additional Fee being charged to Borrower by Bank so long as the conditions set forth in Section 3.5 shall have been
satisfied. Moreover, notwithstanding the foregoing provisions of this Section 11.3, in the event that Borrower terminates this Agreement in
accordance with this Section 11.3 in connection with (y) a sale or transfer of all or substantially all of the stock or assets of
International or the Borrower to a third party prior to September 30, 2005, or (z) a Change in Control of International or Borrower, then the termination fee payable by the Borrower upon
such a termination will equal 0.5% of the Total Facility. 

For
the purposes of this Section 11.3, the term "Change in Control" shall be deemed to occur at any time when any of the following occurs:
(a) any Unrelated Person or any Unrelated Persons, acting together, which would constitute a Group together with any Affiliates or Related Persons thereof (in each case also constituting
Unrelated Persons) shall at any time either (1) Beneficially Own more than 50% of the aggregate voting power of all classes of voting stock of International, or (2) succeed in having a
sufficient number of its or their nominees elected to the Board of Directors of International such that such nominees, when added to any existing director remaining on the Board of Directors of
International after such election who is an Affiliate or Related Person of such Person or Group, shall constitute a majority of the Board of Directors of the Company, or (b) International
ceasing to directly or indirectly own at least 51% of the issued and outstanding voting stock of Borrower. As used herein (1) "Beneficially Own"
means "beneficially own" as defined in Rule 13d-3 of the Securities Exchange Act of 1934, as amended, or any successor provision thereto;
(2) "Group" means a "group" for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended;
(3) "Unrelated Person" means at any time any Person other than International, Borrower, or any of their Affiliates;
(4) "Related Person" of any Person means any other Person owning (A) 10% or more of the outstanding common stock of such Person or
(B) 10% or more of the Voting Stock of such Person; and (5) "Equity" means shares of capital stock or options, warrants, or other right to
substitute for or otherwise acquire the capital stock of International or Borrower, as applicable. 

        14.  The
following is added as a new Section 13.3 to the Financing Agreement: 

	13.3
	Actions in Respect of Letters of Credit. If any Event of Default shall have occurred and be continuing, Bank may, whether in addition
to taking any of the actions described in Section 13.1 or
otherwise, if any Letters of Credit shall have been issued, make demand upon Borrower to, and forthwith upon such demand Borrower will, pay to Bank in same day funds at Bank's office designated in
such demand, for deposit in a special non-interest bearing cash collateral account (the "Letter of Credit Collateral Account") to be
maintained at such office of Bank, an amount equal to the Letter of Credit Exposure from time to time in existence. The Letter of Credit Collateral Account shall be in the name of Bank (as a cash
collateral account), and under the sole dominion and control of 

7

 

Bank
exercised in good faith (with sole right of withdrawal) and subject to the terms of this Agreement and the other Loan Documents. On each drawing under a Letter of Credit, Bank shall seek
reimbursement from any amounts then on deposit in the Letter of Credit Collateral Account; however, if (i) no amounts are then on deposit in the
Letter of Credit Collateral Account, (ii) the amount then on deposit in the Letter of Credit Collateral Account is insufficient to pay the amount of such drawing, or (iii) Bank is
legally prevented or restrained from immediately applying amounts on deposit in the Letter of Credit Collateral Account, then the amount of each unreimbursed drawing under such Letter of Credit and
payment required to be made under this Section 13.3 shall automatically be converted into a Loan made on the date of such drawing for all
purposes of this Agreement. To the extent that Bank applies amounts on deposit in the Letter of Credit Collateral Account as provided in this  Section 13.3, and, thereafter, such application (or any
portion thereof) is rescinded or any amount so applied must otherwise be returned by Bank
upon the insolvency, bankruptcy or reorganization of Borrower or otherwise, then the amount so rescinded or returned shall automatically be converted into a Loan made on the date of such drawing for
all purposes of this Agreement. 

        15.  Exhibit G-2
to the Financing Agreement is deleted and shall remain intentionally blank, and all references thereto in the Financing Agreement shall be
of no further force and effect. 

        16.  Exhibit J
to the Financing Agreement is amended in its entirety to read as set forth on Exhibit J attached hereto and by reference made a part hereof. 

        17.  Exhibit T
to the Financing Agreement is deleted and shall remain intentionally blank, and all references thereto in the Financing Agreement shall be of no further
force and effect. 

        18.  Subject
to the provisions of Section 15.17 of the Financing Agreement, Bank acknowledges repayment in full of the Term Loan A Facility and the Capex Term Loan
Facility, and all applicable fees or other charges related thereto, and Borrower acknowledges that it shall have no further right to borrow under either such facility. Any references in the Financing
Agreement to either such facility shall be of no further force and effect. 

        19.  Borrower
hereby agrees to pay Bank a nonrefundable amendment fee in the amount of $37,500.00 (the "Fee") contemporaneously with the execution of this Amendment. 

        20.  Borrower
hereby agrees to reimburse Bank upon demand for all out-of-pocket costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) incurred by Bank in the preparation, negotiation and execution of this Amendment and any and all other agreements, documents, instruments and/or certificates relating to
the amendment of Borrower's existing credit facilities with Bank (collectively, the "Loan Documents"). Borrower further agrees to pay or reimburse Bank for any stamp or other taxes (excluding income
or gross receipts taxes) which may be payable with respect to the execution, delivery, filing and/or recording of the Loan Documents. All of the obligations of Borrower under this paragraph shall
survive the payment of the Borrower's Obligations and the termination of the Financing Agreement. 

        21.  All
references in the Financing Agreement to "this Agreement" and any other references of similar import shall henceforth mean the Financing Agreement as amended by this
Amendment. 

        22.  Except
to the extent specifically amended by this Amendment, all of the terms, provisions, conditions, covenants, representations and warranties contained in the
Financing Agreement shall be and remain in full force and effect and the same are hereby ratified and confirmed. 

        23.  This
Amendment shall be binding upon and inure to the benefit of Borrower and Bank and their respective successors and assigns, except that Borrower may not assign,
transfer or delegate any of its rights or obligations under the Financing Agreement as amended by this Amendment. 

8

 

        24.  Borrower
hereby represents and warrants to Bank that: 

        (a)  the
execution, delivery and performance by Borrower of this Amendment are within the corporate powers of Borrower, have been duly authorized by all necessary corporate
action and require no action by or in respect of, consent of or filing or recording with, any governmental or regulatory body, instrumentality, authority, agency or official or any other Person; 

        (b)  the
execution, delivery and performance by Borrower of this Amendment do not conflict with, or result in a breach of the terms, conditions or provisions of, or
constitute a default under or result in any violation of, the terms of the Certificate of Incorporation or By-Laws of Borrower, any applicable law, rule, regulation, order, writ, judgment
or decree of any court or governmental or regulatory body, instrumentality authority, agency or official or any agreement, document or instrument to which Borrower is a party or by which Borrower or
any of its Property is bound or to which Borrower or any of its Property is subject; 

        (c)  this
Amendment has been duly executed and delivered by Borrower and constitutes the legal, valid and binding obligation of Borrower enforceable against Borrower in
accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally and
(ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law); 

        (d)  all
of the representations and warranties made by Borrower and/or any other Obligor in the Financing Agreement and/or in any other Transaction Document are true and
correct in all material respects on and as of the date of this Amendment as if made on and as of the date of this Amendment, provided that any representations and warranties which are made as of the
Effective Date are only reaffirmed as of such date; and 

        (e)  as
of the date of this Amendment, no Default or Event of Default under or within the meaning of the Financing Agreement has occurred and is continuing. 

        25.  In
the event of any inconsistency or conflict between this Amendment and the Financing Agreement, the terms, provisions and conditions contained in this Amendment shall
govern and control. 

        26.  This
Amendment shall be governed by and construed in accordance with the substantive laws of the State of Ohio (without reference to conflict of law principles). 

        27.  ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT, INCLUDING PROMISES TO EXTEND OR
RENEW SUCH DEBT, ARE NOT ENFORCEABLE. TO PROTECT BORROWER AND BANK FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY BORROWER AND BANK COVERING SUCH MATTERS ARE CONTAINED IN THE
FINANCING AGREEMENT AS AMENDED BY THIS AMENDMENT AND THE OTHER TRANSACTION DOCUMENTS, WHICH FINANCING AGREEMENT AS AMENDED BY THIS AMENDMENT AND OTHER TRANSACTION DOCUMENTS ARE A COMPLETE AND
EXCLUSIVE STATEMENT OF THE AGREEMENTS BETWEEN BORROWER AND BANK, EXCEPT AS BORROWER AND BANK MAY LATER AGREE IN WRITING TO MODIFY THEM.

        28.  Notwithstanding
any provision contained in this Amendment to the contrary, this Amendment shall not be effective unless and until Bank shall have received: 

        (a)  this
Amendment, duly executed by Borrower; 

9

 

        (b)  a
Consent of Guarantor in form and substance satisfactory to Bank, duly executed by Vari-Lite International, Inc.; and. 

        (c)  the
Fee. 

        IN
WITNESS WHEREOF, Borrower and Bank have executed this Seventh Amendment to Financing Agreement as of the 31st day of December, 2002. 

	 	 	VLPS LIGHTING SERVICES, INC.
	

 	
 	

By:	
 	

/s/  JEROME L. TROJAN III      

	 	 	Title:	 	Vice President—Finance, Chief Financial Officer

	

 	
 	

U.S. BANK NATIONAL ASSOCIATION
	

 	
 	

By	
 	

/s/  PAUL PIECHOWSKI      

	 	 	Title:	 	Senior Vice-President

10

 
 
 

CONSENT OF GUARANTOR    
  

        The undersigned hereby consents to the terms, provisions and conditions contained in that certain Seventh Amendment to Financing Agreement dated as of
December 31, 2002, by and between VLPS Lighting Services, Inc. (formerly known as Vari-Lite, Inc.), a Delaware corporation ("Borrower"), and U.S. Bank National
Association ("Bank") (the "Amendment to Financing Agreement"). The undersigned hereby acknowledges and agrees that (a) the execution and delivery of the Amendment to Financing Agreement by
Borrower to Bank will not adversely affect or impair any of its obligations to Bank under that certain Guaranty dated as of December 29, 2000, and executed by the undersigned in
favor of Bank with respect to the indebtedness of Borrower to Bank (the "Guaranty"), (b) payment of all of the "Obligations" (as defined in that certain Financing Agreement dated
December 29, 2000, by and between Borrower and Bank, as amended by the Amendment to Financing Agreement and as the same may from time to time be further amended, modified, extended, renewed or
restated) is guaranteed to Bank by the undersigned pursuant to the terms of the Guaranty and (c) the Guaranty is in full force and effect on the date hereof and the same is hereby ratified and
confirmed. 

        Executed
as of the 31st day of December, 2002. 

	

 	
 	

VARI-LITE INTERNATIONAL, INC., Guarantor
	

 	
 	

By:	
 	

/s/  JEROME L. TROJAN III      

	 	 	Title:	 	Vice President—Finance, Chief Financial Officer

11

 
 
 

EXHIBIT J
  
    FINANCIAL COVENANTS    
  

        Section 1.    Capital Expenditures. Borrower will not make nor permit
International to make Net Capital Expenditures (as defined below) in a total amount that exceeds $7,000,000.00 in the aggregate for any Fiscal Year (as defined below). 

        Section 2.    Minimum Fixed Charge Coverage Ratio.

        2.1  Borrower
will not permit the ratio ("Fixed Charge Coverage Ratio") resulting from  dividing International's EBITDA (as defined below) by International's Fixed
Charges (as defined below), both for the applicable fiscal period then
ended, to be less than (i) 0.78:1.0 for the period from October 1, 2002, to December 31, 2002, (ii) 1.1:1.0 for the period from October 1, 2002, to March 31,
2003, and (iii) 1.2:1.0 for the period from October 1, 2002, to June 30, 2003. Thereafter, as of the end of each fiscal quarter of International, commencing with the fiscal
quarter ending September 30, 2003, Borrower will not permit its Fixed Charge Coverage Ratio resulting from dividing International's 12 Month
EBITDA (as defined below) by International's Fixed Charges (as defined below) for the applicable 12 Month Period (as defined below) to be less than
1.25:1.0. 

        2.2  For
purposes of this Exhibit J:

          (i)  EBITDA means, for the period in question, the sum of International's (a) consolidated net income during such
period plus (b) to the extent deducted in determining such net income, the sum of (i) interest expense during such period,  plus (ii) all
provisions for any Federal, state, local and/or foreign income taxes during such period (whether paid or deferred),  plus (iii) all depreciation and amortization expenses during such period,
plus (iv) any
extraordinary losses during such period plus (v) any losses from the sale or other disposition of property other than in the ordinary course of
business during such period minus (c) to the extent added in determining such net income, the sum of (i) any extraordinary gains during
such period minus (ii) any gains from the sale or other disposition of property other than in the ordinary course of business during such period,
all determined on a consolidated basis and in accordance with GAAP. 

        (ii)  "Fixed Charges" shall mean, for the period in question, the sum of (a) the aggregate amount of all principal
payments required to be made by International and its consolidated subsidiaries on all Indebtedness during such period (including the principal portion of payments in respect of capitalized leases but
excluding principal payments on the Revolving Loans), plus (b) interest expense of International and its consolidated subsidiaries during such
period, plus (c) 50% all Net Capital Expenditures made by International and its consolidated subsidiaries during such period (other than those
financed with Indebtedness incurred by International and its consolidated subsidiaries), plus (d) all cash payments for any Federal, state, local
and/or foreign income taxes made by Borrower during such period, plus (e) all dividends and other distributions paid by Borrower on or with
respect to its capital stock, including for stock repurchases, during such period (whether for taxes or otherwise, but excluding $1,500,000 in Permitted Payments made during Borrower's fiscal year
ending September 30, 2003), all determined on a consolidated basis and in accordance with GAAP. 

        (iv)  "12 Month EBITDA " means EBITDA for the 12 Month Period for which the applicable Fixed Charge Coverage Ratio is then
being determined. "12 Month EBITDA" will be calculated for each 12 Month Period ending as of the end of each Fiscal Quarter or Fiscal Year. 

        (iii)  "Fiscal Quarter" means, in respect of a date as of which the applicable Financial Covenant is being calculated, any
quarter of a Fiscal Year, the first Fiscal Quarter beginning 

12

 

on October 1 and ending on December 31, the second Fiscal Quarter beginning on January 1 and ending on March 31, the third Fiscal Quarter beginning on April 1 and
ending on June 30, and the fourth Fiscal Quarter beginning on July 1 and ending on September 30. 

        (iv)  "Fiscal Year" means International's fiscal year for financial accounting purposes, beginning on October 1 and
ending on September 30. 

        (v)  "12 Month Period" means, in respect of a date as of which the applicable Financial Covenant is being calculated, the four
consecutive Fiscal Quarters immediately preceding the date as of which the Financial Covenant is being calculated (i.e., a rolling four Fiscal Quarter
(or 12 month) period). 

        (vi)  "Net Capital Expenditures" means the sum of (a) International's consolidated capital expenditures (including, but
not by way of limitation, expenditures for fixed assets or leases capitalized or required to be capitalized on International's consolidated books by purchase, lease-purchase agreement, option or
otherwise), minus (b) the net book value of capital assets previously sold and replaced by such capital expenditures. 

        Section 3.    Minimum Tangible Net Worth.

        3.1  Borrower
will not permit International's Tangible Net Worth (as defined below) to be less than the following amounts set opposite the following periods as of the end of
any calendar month ended during the following periods (including any calendar month which ended on the first day of the following periods): 

	Period
	 	Minimum Tangible Net Worth

	December 31, 2002 through, and including, September 29, 2003	 	$	32,000,000
	September 30, 2003 and thereafter	 	$	32,500,000

        3.2  For
purposes of this Exhibit J, 

          (i)  "Tangible Net Worth" means the total of International's book net worth in Dollars, determined in accordance with GAAP
consistently applied, based on FIFO accounting for its Inventory (including the sum of common stock, paid in capital, and earned surplus), net of any adjustment arising from foreign currency
valuations, minus (without duplication) (a) all employee, officer or Affiliate Receivables; minus
(b) all capitalized organizational or closing costs; minus (c) the then amount of deferred financing costs;  minus (d) all advances to
Affiliates or in respect of guarantees on their behalf; minus
(e) all goodwill; minus (f) all deferred pension assets; minus (g) all investments
in any stock, Indebtedness, or securities of, or any other Ownership Interest in, any Person; minus (h) any other asset considered under GAAP as
an intangible asset; and minus (i) any (1) gain from the sale of capital assets outside the ordinary course of business, (2) gain
from any write-up of assets, (3) gain from the acquisition of debt securities or Ownership Interests of International or from cancellation or forgiveness of Indebtedness, or
(4) gain or income arising from accretion of any negative goodwill; and minus or plus, as
applicable, (j) gain or loss recognized by International as earnings which relate to any extraordinary accounting adjustments or non-recurring items of income or include any amounts
attributable to extraordinary gains or extraordinary items of income or any other non-operating, non-recurring gain from time to time occurring to the extent, in each case, the
gains or items of income are non-cash. 

        Section 4.    Definitions. Capitalized terms used, but not defined, in
this Exhibit J have the meanings given to them in the Financing Agreement. 

13

QuickLinks

Exhibit 10.90

AMENDMENT NO. 7 TO FINANCING AGREEMENT

CONSENT OF GUARANTOR

EXHIBIT J FINANCIAL COVENANTS

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