<PAGE>
Exhibit 10(r)
FIRST AMENDMENT TO SECOND AMENDED AND RESTATED
SENIOR REVOLVING CREDIT AGREEMENT
This FIRST
AMENDMENT TO SECOND AMENDED AND RESTATED SENIOR REVOLVING
CREDIT AGREEMENT (the "Amendment") is made
as of this 5th day of March, 2004, by
and among ENESCO GROUP, INC., an Illinois
corporation (the "Borrower"), the
Borrowing Subsidiaries that may from time
to time become a party to the Second
Amended and Restated Senior Revolving
Credit Agreement, FLEET NATIONAL BANK, a
national banking association, as Agent and
a Lender ("Fleet") and LaSalle Bank
National Association, a national banking
association ("LaSalle" and together
with Fleet, the "Lenders").
RECITALS
The
Borrower and the Lenders are parties to a certain Second Amended
and
Restated Senior Revolving Credit Agreement
dated as of June 16, 2003 (the
"Credit Agreement"), pursuant to which the
Lenders have extended certain
financial accommodations to the Borrower
including those evidenced by a Borrower
Note in the face amount of $25,000,000
payable to Fleet, a Borrower Note in the
face amount of $15,000,000 payable to
LaSalle, a Back-Up L/C and B/A Demand Note
in the face amount of $10,000,000 payable
to Fleet and a Back-Up F/X Demand Note
in the face amount of $10,000,000 payable
to Fleet, all such promissory notes
dated as of June 16, 2003, and a Borrowing
Subsidiary Note dated as of September
10, 2003 made by Enesco International
(H.K.) Limited payable to Fleet in the
face amount of $5,000,000 (collectively,
the "Notes"). The Borrower and the
Lenders have agreed to modify the terms and
provisions of the Credit Agreement
and to ratify and confirm that all
Obligations of the Borrower to the Lenders
continue to be evidenced by the Loan
Documents, all as more fully described and
set forth hereinbelow. Capitalized terms
not otherwise defined in this Amendment
shall have their meanings as defined in the
Credit Agreement.
NOW,
THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby
acknowledged, the Borrower and the Lenders agree
that the Credit Agreement is amended as
follows:
1.
The
definition of "Advance" that appears in Article I is deleted in
its entirety and replaced with the following:
"Advance" means a borrowing hereunder consisting of (i) the
aggregate amount of the several Loans of the same Type and, in
the
case of LIBOR Advances or Cost of Funds Advances, for the same
Interest Period and, in the case of LIBOR Advances, in the same
currency, made by the Lenders to a Credit Party pursuant to
Section
2.1,
(ii) reimbursement obligations arising in connection with
foreign exchange transactions pursuant to Section 2.1.A, (iii)
reimbursement obligations arising as a result of Letters of
Credit
and Bankers' Acceptances issued pursuant to Section 2.1.B, or
(iv)
the aggregate amount of Term Loan made available pursuant to
Section
2.1.C.
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2.
The
following definition is added to Article I:
"Aggregate Term Loan Commitment" means the aggregate of the
Term Loan Commitments of all Lenders to make Term Loans, as may
be
in effect from time to time.
3.
The
definition of "Agreement" that appears in Article I is deleted
in its entirety and replaced with the following:
"Agreement" means this Second Amended and Restated Senior
Revolving Credit Agreement, as it may be amended or modified and
in
effect from time to time.
4.
The
definition of "Applicable Margin" that appears in Article I is
deleted in its entirety and replaced with the following:
"Applicable Margin" means (i) that number of basis points over
the LIBOR Base Rate, the Cost of Funds or the Alternative Base
Rate,
as applicable, and (ii) the Facility Fee (each of (i) and (ii)
as
determined based upon the Borrower's Fixed Charge Coverage Ratio
in
accordance with the pricing grid that appears immediately
below):
PRICING GRID
<TABLE>
<CAPTION>
LEVEL 1
LEVEL 2
LEVEL 3
<S>
<C>
<C>
<C>
Fixed Charge
3.75 to 1.00 or 3.50 to 1.00 to Less
Less
than 3.50
Coverage Ratio
Greater
than 3.75 to 1.00
to 1.00
I. REVOLVING LOANS
Facility Fee
25 bps
25 bps
25 bps
LIBOR Base Rate 100
bps
140 bps
175 bps
Cost of Funds
100 bps
140 bps
175 bps
Alternate Base Rate 0 bps
0 bps
0 bps
II. TERM LOAN
LIBOR Base Rate 115
bps
155 bps
190 bps
Cost of Funds
115 bps
155 bps
190 bps
Alternate Base Rate 0 bps
0 bps
0 bps
*bps = basis points
</TABLE>
The Applicable Margin shall be established by the Agent based
upon
the Borrower's Fixed Charge Coverage Ratio using the Borrower's
most
recently
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delivered financial statement pursuant to Section 6.1. Pricing,
effective March 5, 2004 and until delivery by the Borrower of a
Compliance Certificate for the fiscal quarter ending March 31,
2004,
shall be in accordance with Level 1. Notwithstanding anything to
the
contrary with respect to any determination of Applicable Margin,
for
the period following delivery of its financial statement for
the
fiscal year ending December 31, 2004 until delivery of its
financial
statement for the fiscal quarter ending March 31, 2005 only,
the
Borrower shall qualify for Level 1 pricing if the Consolidated
Operating Profit of the Borrower for such fiscal year ending
December 31, 2004 is not less than $13,267,000.
5.
The
definition of "Borrower" that appears in Article I is deleted
in
its entirety and replaced with the following:
"Borrower" means Enesco Group, Inc., an Illinois corporation
and its permitted successors and assigns.
6.
The
following definition is added to Article I:
"Borrower Term Note" means a promissory note in substantially
the form of Exhibit A-5 hereto duly executed by the Borrower
and
payable to the order of a Lender or any Purchaser pursuant to
Section 12.3 of this Agreement in the amount of such Lender's
Term
Loan Commitment, including any amendment, modification, renewal
or
replacement of such promissory note.
7.
The
following definition is added to Article I:
"Commitments" means, collectively, the Commitment and the Term
Loan Commitment.
8.
The
following definition is added to Article I:
"Consolidated Principal Payments Made on Long-Term
Indebtedness" means as of the date of any determination thereof,
the
amount of principal payments made by the Borrower and its
Subsidiaries as shown on the consolidated statement of cash flow
of
the Borr
