AMENDMENT OF LOAN
AGREEMENT
THIS AMENDMENT OF LOAN AGREEMENT (this
“Amendment”) is made as of this 31st day of July, 2008,
by and among CSS INDUSTRIES, INC. (the “Company”), CSS
MANAGEMENT LLC (the “Subsidiary Borrower” and, together
with the Company, individually, each a “Borrower” and
collectively, the “Borrowers”), the lenders from time
to time parties to the Loan Agreement defined below (the
“Lenders”), and PNC BANK, NATIONAL ASSOCIATION, as
Administrative Agent (the “Administrative Agent”) for
the Lenders.
A. The Administrative Agent, the Lenders
and the Borrowers entered into an Amended and Restated Loan
Agreement dated as of April 23, 2004 (as heretofore modified
and amended, the “Loan Agreement”), pursuant to which
the Lenders agreed to make Advances from time to time to the
Borrowers.
B. The Borrowers have requested and the
Administrative Agent and the Lenders have agreed to amend certain
of the provisions in the Loan Agreement with respect to Letters of
Credit, all on the terms and subject to the conditions set forth
herein.
NOW, THEREFORE , in consideration of the foregoing and for good
and valuable consideration, the legality and sufficiency of which
are hereby acknowledged, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. Definitions
. Capitalized terms used herein,
including in the foregoing recitals, and not otherwise defined
herein shall have the meanings assigned to them in the Loan
Agreement.
2. Amendments to Loan
Agreement . The Loan
Agreement is hereby amended effective as of July 31, 2008 (the
“Amendment Effective Date”) as follows:
(a) The following new definition of “
Letter of Credit Coverage Requirement ” is added to
Section 1.1 in the appropriate alphabetical order:
““
Letter of Credit Coverage Requirement ”: with respect
to each Letter of Credit at any time, 102% of the maximum amount
available to be drawn thereunder at such time (determined without
regard to whether any conditions to drawing could be met at such
time).”
(b) The third and fourth sentences of
Section 2.2(a) are amended and restated to read in full as
follows:
“No
standby Letter of Credit shall be issued with an expiry date later
than the earlier of: (i) one (1) year from the date of
issuance and (ii) except as provided in Section 2.2(h),
the Maturity Date. No commercial Letter of Credit shall be issued
with an expiry date later than the earlier of: (i) one hundred
twenty (120) days from the date of issuance and
(ii) except as provided in Section 2.2(h), the Maturity
Date.”
(c) The
following new Section 2.2(h) is added immediately following
Section 2.2(g):
“(h) If
the expiration date for any Letter of Credit requested by the
Borrowers to be issued, or extended or renewed, pursuant to
Section 2.2(a) is later than the Maturity Date, the Fronting
Lender may nonetheless issue, or extend or renew, such Letter of
Credit notwithstanding that such expiration date is later than the
Maturity Date, provided that Borrowers shall on or before the day
five (5) days prior to the Maturity Date deposit with the
Administrative Agent as security for the Obligations, cash in an
amount equal to the Letter of Credit Coverage Requirement with
respect to each such Letter of Credit which remains outstanding on
such date, which cash shall be deposited with, pledged to and held
by the Administrative Agent for the benefit of the Lenders in the
same manner as provided in Section 8.2(c).”
(d) Section 8.2(c) is hereby amended
and restated to read in full as follows:
“(c) Upon
the occurrence and during the continuance of an Event of Default
and in addition to all other rights and remedies available to the
Administrative Agent, the Borrowers shall upon demand of the
Administrative Agent, deposit in a non-interest bearing account
with the Administrative Agent, as cash collateral for the
Obligations, an amount equal to the aggregate Letter of Credit
Coverage Requirement, and the Borrowers hereby pledge to the
Administrative Agent and the Lenders, and grant to the
Administrative Agent and the Lenders a security interest in, all
such cash as security for the Obligations. Amounts held in such
cash collateral account shall be applied by the Administrative
Agent to the payment of drafts drawn under any Letters of Credit,
and the unused portion thereof after all the Letters of Credit
shall have expired or been fully drawn upon, if any, shall be
applied to repay other Obligations of the Borrowers hereunder and
under the Notes. After all Letters of Credit shall have expired or
been fully drawn upon, all Obligations with respect thereto shall
have been satisfied and all other Obligations of the Borrowers
hereunder and under the Notes shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned
to the Borrowers. The Borrowers shall execute and deliver to the
Administrative Agent, for the account of the Fronting Bank and the
Lenders, such further documents and instruments as the
Administrative Agent may request to evidence the creation and
perfection of the within security interest in such cash collateral
account. Except as expressly provided above in this Section,
presentment, demand, protest and all other notices of any kind are
expressly waived.”
2
3. Amendment to the Loan
Documents . All
references to the Loan Agreement in the Loan Documents shall be
deemed to refer to the Loan Agreement as amended hereby.
4. Ratification of the Loan
Documents .
Notwithstanding anything to the contrary herein contained or any
claims of the parties to the contrary, the Administrative Agent,
the Lenders a
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