AMENDMENT AND LIMITED WAIVER OF LOAN AGREEMENT
THIS AMENDMENT AND LIMITED WAIVER OF LOAN AGREEMENT (this "Amendment")
is made as of this 12th day of December, 2002, by and among CSS INDUSTRIES, INC.
(the "Borrower"), the lenders from time to time parties to the Loan Agreement
defined below (the "Lenders"), and PNC BANK, NATIONAL ASSOCIATION, as
Administrative Agent (the "Agent") for the Lenders.
Background:
A. The Agent, the Lenders and the Borrower entered into a Loan
Agreement dated as of April 30, 2001 (as heretofore modified and amended, the
"Loan Agreement"), pursuant to which the Lenders agreed to make Advances from
time to time to the Borrower.
B. In connection with the Accounts Receivable Securitization the
Borrower has been requested to enter into a Performance Guaranty (the
"Performance Guaranty") guaranteeing the obligations of certain of its
Subsidiaries which are Originators under, and as such term is defined in, the
Accounts Receivable Securitization Documents.
C. Under the terms of a Note Purchase Agreement dated as of December
12, 2002 between the Borrower and the note purchasers party thereto (the "Note
Purchase Agreement") to be entered into in connection with the Private
Placement, the Borrower will be required to enter into a negative pledge
agreement of the type referred to in Section 6.3(a)(i) of the Loan Agreement and
to agree to make certain prepayments of the Indebtedness being incurred under
the Note Purchase Agreement.
D. As a result of and in connection with the foregoing, the Borrower
has requested and the Agent and the Lenders have agreed to amend and waive
certain of the covenants in the Loan Agreement, 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. Limited Waivers. The Agent and the Lenders hereby waive the
provisions of Section 6.3(a) of the Loan Agreement to the extent necessary to
permit the Borrower to agree to the provisions of Section 10.6 of the Note
Purchase Agreement. Except as set forth in this Section 2, this Amendment does
not and shall not be deemed to constitute a waiver by the Agent or the Lenders
of any Event of Default, or of any event which with the passage of time or the
giving of notice or both would constitute an Event of Default, nor does it
obligate the Agent or the Lenders to agree to any further waivers of or
modifications to the Loan Agreement or any other Loan Document or constitute a
waiver of any other rights or remedies.
3. Amendments to Loan Agreement. The Loan Agreement is hereby amended
effective as of December 12, 2002 (the "Effective Date") as follows:
(a) The definition of "Private Placement" in Section 1.1 is amended and
restated to read in full as follows:
""Private Placement": The private placement of up to
$50,000,000 principal amount of debt securities by the
Borrower with institutional lenders other than the Lenders
pursuant to the terms of the Note Purchase Agreement."
(b) The following additional definitions are added to Section 1.1 in
the appropriate alphabetical order.
""Note Purchase Agreement": The Note Purchase Agreement dated as of
December 12, 2002 among the Borrower and the note purchasers thereto.
"Note Purchase Documents": The Note Purchase Agreement and the notes
issued pursuant to the terms thereof."
(c) Section 6.5 is hereby amended and restated to read in full as
follows:
"6.5 Guarantees. Excepting (a) the endorsement in the ordinary course
of business of negotiable instruments for deposit or collection, (b)
the Guarantees, (c) guarantees by the Borrower or by any Guarantor of
operating leases of any Subsidiary entered into in the ordinary course
of business, (d) indemnification obligations to directors and officers
under applicable law or set forth in the certificate of incorporation
and/or by-laws of the Borrower or any Subsidiary, (e) guarantees by the
Borrower or by any Guarantor for the Indebtedness of Borrower or any
Guarantor and guarantees by the Borrower of any of the obligations of
any Guarantor under any of the Accounts Receivable Securitization
Documents, and (f) additional guarantees by the Borrower and/or any of
the Guarantors for the Indebtedness of any Person which, together with
Indebtedness permitted under Section 6.11(b)(v) below shall not exceed
$20,000,000 at any one time outstanding, the Borrower shall not, nor
shall it cause or permit any of the Guarantors to, become or be liable
in any manner, directly or indirectly, primarily or secondarily,
whether as guarantor, surety, accommodation maker, or otherwise for the
existing or future, matured or contingent, indebtedness or obligations
of any kind or nature of any Person."
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(d) Section 6.11 is hereby amended and restated to read in full as
follows:
"6.11 Indebtedness. The Borrower shall not, nor shall it cause or
permit any of the Guarantors to (a) make any prepayments of any nature
whatsoever (or deposit money or other Property for the purpose thereof)
on any existing or future long-term Indebtedness to any Person except
(x) the conversion of Indebtedness to equity so long as the entire
amount of the portion of the Indebtedness so prepaid is so converted
and (y) required prepayments of the Indebtedness incurred under the
Note Purchase Documents and prepayments of such Indebtedness in the
event of a Change of Control (as defined in the Note Purchase
Agreement) or (b) hereafter incur or be or become liable for
Indebtedness except for (i) Indebtedness to the Lenders pursuant to
this Agreement, (ii) purchase money financing supported by Liens
permitted pursuant to Sections 6.3(a)(3) or 6.3(a)(5) above and
Indebtedness secured by the existing Liens described in Section
6.3(a)(4), (iii) Indebtedness permitted under Section 6.4(b), (iv)
Indebtedness under the notes issued in connection with the Private
Placement in a principal amount not exceeding $50,000,000 and (v)
additional Indebtedness in an aggregate principal amount, together with
all obligations described in Section 6.5(f) herein, not exceeding
$20,000,000 at any one time outstanding."
(e) Section 6.13 is hereby amended by amending and restating the final
clause thereof to read in full as follows:
"except restrictions pursuant to (A) the Loan Documents, (B) applicable
law, (C) the Accounts Receivable Securitization Documents and (D) the
Note Purchase Agreement.
4. 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.
5. Ratification of the Loan Documents. Notwithstanding anything to the
contrary herein contained or any claims of the parties to the contrary, the
Agent, the Lenders and the Borrower agree that the Loan Documents are in full
force and effect and each such document shall remain in full force and effect,
as amended by this Amendment and the Borrower hereby ratifies and confirms its
obligations thereunder.
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6. Representations and Warranties.
(a) The Borrower hereby certifies that after giving effect to this
Amendment, (i) the representations and warranties of the Borrower in the Loan
Agreement are true and correct in all material respects as if made on the date
hereof and (ii) no Event of Default and no event which could become an Event of
Default with the passage of time or the giving of notice, or both, under the
Loan Agreement or the other Loan Documents exists on the date hereof.
(b) The Borrower further represents that the Borrower has all the
requisite power and authority to enter into and to perform its obligations under
this Amendment, and that the execution, delivery and performance of this
Amendment have been duly authorized by all requisite action and will not violate
or constitute a default under any provision of any applicable law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
presently in effect or of the Certificate of Incorporation, by-laws or other
organizational documents of the Borrower, or of any indenture, note, loan or
loan agreement, license or any other agreement, lease or instrument to which the
Borrower is a party or by which the Borrower or any of its properties are bound.
(c) The Borrower also further represents that its obligations to repay
the Advances, together with all interest accrued thereon, are absolute and
unconditional, and there exists no right of set off or recoupment, counterclaim
or defense of any nature whatsoever to payment of the Advances.
(d) The Borrower also further represents that there have been no
changes to the Certificate of Incorporation, by-laws or other organizational
documents of the Borrower since the most recent date true and correct copies
thereof were delivered to the Agent.
7. Conditions Precedent. The amendments set forth herein shall be
effective as of the Effective Date upon the fulfillment, to the satisfaction of
the Agent and its counsel, of the following conditions precedent:
(a) The Borrower shall have delivered to the Agent the following, all
of which shall be in form and substance satisfactory to the Agent and shall be
duly completed and executed:
(i) counterparts of this Amendment executed by the Borrower, the
Lenders and the Guarantors;
(ii) a copy of the duly executed Performance Guaranty;
(iii) copies of the duly executed Note Purchase Documents; and
(iv) such additional documents, certificates and information as the
Agent may reasonably request.
(b) After giving effect to this Amendment, the representations and
warranties set forth in the Loan Agreement shall be true and correct on and as
of the date hereof.
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(c) After giving effect to this Amendment, no Event of Default, and no
event which, with the passage of time or the giving of notice, or both, would
become such an Event of Default shall have occurred and be continuing as of the
date hereof.
8. Miscellaneous
(a) To induce the Agent and the Lenders to enter into this Amendment,
the Borrower waives and releases and forever discharges the Agent and the
Lenders and their respective officers, directors, attorneys, agents, and
employees from any liability, damage, claim, loss or expense of any kind of
which it has knowledge as of the date hereof against any of them arising out of
or relating to the Loan Documents. The Borrower further agrees to indemnify and
hold the Agent, the Lenders and their respective officers, directors, attorneys,
agents and employees (collectively, the "Indemnitees") harmless from any loss,
damage, judgment, liability or expense (including reasonable attorneys' fees),
other than any such loss, damage judgment, liability or expense caused by the
Indemnitee's own willful misconduct or gross negligence, suffered by or rendered
against any of them on account of any claims arising out of or relating to the
Loan Documents. The Borrower further states that it has carefully read the
foregoing release and indemnity, knows the contents thereof and grants the same
as its own free act and deed.
(b) All terms, conditions, provisions and covenants in the Loan
Documents and all other documents delivered to the Agent in connection therewith
shall remain unaltered and in full force and effect except as modified or
amended hereby. To the extent that any term or provision of this Amendment is or
may be deemed expressly inconsistent with any term or provision in any Loan
Document or any other document executed in connection therewith, the terms and
provisions hereof shall control.
(c) This Amendment constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes all prior and
contemporaneous understandings and agreements.
(d) In the event any provisions of this Amendment shall be held invalid
or unenforceable by any court of competent jurisdiction, such holding shall not
invalidate or render unenforceable any other provision hereof.
(e) This Amendment shall be governed by and construed according to the
laws of the Commonwealth of Pennsylvania.
(f) This Agreement shall inure to the benefit of, and be binding upon,
the parties hereto and their respective successors and assigns and may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
(g) The headings used in this Agreement are for convenience of
reference only, do not form a part of this Amendment and shall not affect in any
way the meaning or interpretation of this Amendment.
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The Borrower expressly ratifies and confirms the waiver of jury trial
provisions contained in the Loan Documents.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first above written.
CSS INDUSTRIES, INC.
By: __________________________________
Name: ________________________________
Title: _______________________________
PNC BANK, NATIONAL
ASSOCIATION, as a Lender,
as Swing Line Lender, as
Fronting Lender and as
Administrative Agent
By: __________________________________
Name: ________________________________
Title: _______________________________
WACHOVIA BANK, NATIONAL ASSOCIATION,
as a Lender
By: __________________________________
Name: ________________________________
Title: _______________________________
FLEET NATIONAL BANK, as a Lender
By: __________________________________
Name: ________________________________
Title: _______________________________
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CITIZENS BANK OF PENNSYLVANIA, as a Lender
By: __________________________________
Name: ________________________________
Title: _______________________________
UNION PLANTERS BANK, as a Lender
By: __________________________________
Name: ________________________________
Title: _______________________________
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ACKNOWLEDGMENT AND AGREEMENT
Each of the undersigned hereby acknowledges the provisions of
the foregoing Amendment and Limited Waiver of Loan Agreement (the "Amendment")
and confirms and agrees that its obligations under its Guaranty Agreement in
favor of the Lenders referred to in the Amendment shall be unimpaired by the
Amendment and are hereby ratified and confirmed in all respects in respect of
the Obligations of CSS Industries, Inc. under the Loan Agreement, as amended.
THE PAPER MAGIC GROUP, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
BERWICK DELAWARE, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
BERWICK OFFRAY LLC (formerly Berwick Industries LLC)
By:_________________________________________
Name:_______________________________________
Title:______________________________________
XXXX INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
XXXX DELAWARE, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
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PHILADELPHIA INDUSTRIES, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
LLM HOLDINGS, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
THE PAPER MAGIC GROUP, INC.
(a Delaware corporation)
By:_________________________________________
Name:_______________________________________
Title:______________________________________
DON POST STUDIOS, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
LION RIBBON COMPANY, INC. (formerly Daylight
Acquisition Corp.)
By:_________________________________________
Name:_______________________________________
Title:______________________________________
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THE PAPER MAGIC GROUP (HONG KONG) LTD.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
CRYSTAL CREATIVE PRODUCTS, INC.
By:_________________________________________
Name:_______________________________________
Title:______________________________________
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