Exhibit 10.2
August 1, 2008
CSS Industries, Inc.
CSS Management LLC
1845 Walnut Street, Suite 800
Philadelphia, PA 19103
Attention: Clifford E. Pietrafitta
 Chief Financial Officer
Re: $10,000,000 Committed Line of Credit
Ladies and Gentlemen:
We are pleased to inform you that PNC Bank, National Association (the “Bank”),
has approved your request for a committed line of credit to CSS Industries, Inc.
and CSS Management LLC (individually and collectively, the “Borrower”). All the
details regarding your line of credit are outlined in the following sections of
this letter.
1. Facility and Use of Proceeds. This is a committed revolving line of credit
under which the Borrower may request and the Bank, subject to the terms and
conditions of this letter, will make advances to the Borrower from time to time
until the Expiration Date, in an amount in the aggregate at any time outstanding
not to exceed $10,000,000 (the “Line of Credit” or the “Loan”). The “Expiration
Date” means the earlier of (a) September 29, 2008 (or such later date as may be
designated by the Bank by written notice to the Borrower) and (b) the date of
the termination of the revolving credit facility under the Senior Loan Agreement
(as hereinafter defined). Advances under the Line of Credit will be used for
working capital or other general business purposes of the Borrower.
2. Note. The obligation of the Borrower to repay advances under the Line of
Credit shall be evidenced by a committed line of credit note (the “Note”) in
form and content satisfactory to the Bank.
This letter (the “Letter Agreement”), the Note and the other agreements and
documents executed and/or delivered pursuant hereto, as each may be amended,
modified, extended or renewed from time to time, will constitute the “Loan
Documents.” Capitalized terms not defined herein shall have the meaning ascribed
to them in the Loan Documents.
3. Interest Rate. Interest on the unpaid balance of the Line of Credit advances
will be charged at the rates, and be payable on the dates and times, set forth
in the Note.
4. Repayment. Subject to the terms and conditions of this Letter Agreement, the
Borrower may borrow, repay and reborrow under the Line of Credit until the
Expiration Date, on which date the outstanding principal balance and any accrued
but unpaid interest shall be due and payable. Interest will be due and payable
as set forth in the Note, and will be computed on the basis of a year of
360 days and paid on the actual number of days that principal is outstanding.

 

 

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CSS Industries, Inc.
CSS Management LLC
August 1, 2008
Page 2
5. Security. The Borrower must cause to be executed and delivered to the Bank in
form and content satisfactory to the Bank as security for the Loan a guaranty
and suretyship agreement, under which each of its respective subsidiaries which
is a guarantor of the Borrower’s obligations under the Senior Loan Agreement
(individually or collectively, the “Guarantor”) will unconditionally jointly and
severally guarantee the due and punctual payment of all indebtedness owed to the
Bank by the Borrower under the Loan Documents.
In addition, the Loan will be cross-defaulted with all other present and future
obligations of the Borrower to the Bank under that certain Amended and Restated
Loan Agreement dated as of April 23, 2004 among the Borrower, the Bank and
certain other lenders from time to time parties thereto and the Bank as
Administrative Agent for such lenders, as heretofore or hereafter modified or
amended (the “Senior Loan Agreement”).
6. Covenants. Unless compliance is waived in writing by the Bank, until payment
in full of the Loan and termination of the commitment for the Line of Credit:
(a) The Borrower will promptly submit to the Bank such information as the Bank
may reasonably request relating to the Borrower’s affairs (including but not
limited to the financial information the Borrower is obligated to provide to the
Bank pursuant to the Senior Loan Agreement).
(b) The Borrower will notify the Bank in writing of the occurrence of any Event
of Default (as such term is defined in the Senior Loan Agreement) or an act or
condition which, with the passage of time, the giving of notice or both would
become such an Event of Default.
7. Representations and Warranties. To induce the Bank to extend the Loan and
upon the making of each advance to the Borrower under the Line of Credit, the
Borrower represents and warrants as follows:
(a) The Borrower’s latest financial statements provided to the Bank pursuant to
the Senior Loan Agreement are true, complete and accurate in all material
respects and fairly present the financial condition, assets and liabilities,
whether accrued, absolute, contingent or otherwise, and the results of the
Borrower’s operations for the period specified therein. Since the date of the
latest Financial Statements provided to the Bank, the Borrower has not suffered
any damage, destruction or loss which has materially adversely affected its
business, assets, operations, financial condition or results of operations.
(b) There are no actions, suits, proceedings or governmental investigations
pending or, to the knowledge of the Borrower, threatened against the Borrower
which would result in a material adverse change in its business, assets,
operations, financial condition or results of operations and there is no basis
known to the Borrower or its officers for any such action, suit, proceedings or
investigation.

 

 

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CSS Industries, Inc.
CSS Management LLC
August 1, 2008
Page 3
(c) The Borrower has filed all returns and reports that are required to be filed
by it in connection with any federal, state or local tax, duty or charge levied,
assessed or imposed upon the Borrower or its property, including unemployment,
social security and similar taxes and all of such taxes have been either paid or
adequate reserve or other provision has been made therefor.
(d) Each Borrower is duly organized, validly existing and in good standing under
the laws of the state of its incorporation or organization and has the power and
authority to own and operate its assets and to conduct its business as now or
proposed to be carried on, and is duly qualified, licensed and in good standing
to do business in all jurisdictions where its ownership of property or the
nature of its business requires such qualification or licensing, except where
the failure to be so qualified would not have a material adverse effect upon
such Borrower.
(e) Each Borrower has full power and authority to enter into the transactions
provided for in this Letter Agreement and has been duly authorized to do so by
all necessary and appropriate action and when executed and delivered by such
Borrower, this Letter Agreement and the other Loan Documents will constitute the
legal, valid and binding obligations of such Borrower, enforceable against such
Borrower in accordance with their terms.
(f) There does not exist any default or violation by the Borrower of or under
any of the terms, conditions or obligations of: (i) its organizational
documents; (ii) any indenture, mortgage, deed of trust, franchise, permit,
contract, agreement, or other instrument to which it is a party or by which it
is bound; or (iii) any law, regulation, ruling, order, injunction, decree,
condition or other requirement applicable to or imposed upon the Borrower by any
law or by any governmental authority, court or agency, which default or
violation could reasonably be expected to have a material adverse effect on such
Borrower.
8. Fees. On the date of the Note, the Borrower shall pay to the Bank a fee of
$15,000.
9. Expenses. The Borrower will reimburse the Bank for the Bank’s expenses
(including the reasonable fees and expenses of the Bank’s counsel) in
documenting and closing this transaction, in connection with any amendments,
modifications or renewals of the Loan, and in connection with the collection of
all of the Borrower’s Obligations to the Bank, including but not limited to
enforcement actions relating to the Loan.
10. Additional Provisions. Before the first advance under the Loan, the Borrower
shall execute and deliver to the Bank the Note and the other required Loan
Documents and such other instruments and documents as the Bank may reasonably
request, such as certified resolutions, incumbency certificates or other
evidence of authority. The Bank will not be obligated to make any advance under
the Line of Credit if any Event of Default or event which with the passage of
time, provision of notice or both would constitute an Event of Default shall
have occurred and be continuing.
Prior to execution of the final Loan Documents, the Bank may terminate this
Letter Agreement if a material adverse change occurs with respect to the
Borrower, the Guarantor or any collateral for the Loan, or if the Borrower fails
to comply with any of the terms and conditions of this Letter Agreement, or if
the Bank reasonably determines that any of the conditions cannot be met.

 

 

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CSS Industries, Inc.
CSS Management LLC
August 1, 2008
Page 4
This Letter Agreement is governed by the laws of the Commonwealth of
Pennsylvania. The obligations of the Borrower hereunder are joint and several.
No modification, amendment or waiver of any of the terms of this Letter
Agreement, nor any consent to any departure by the Borrower therefrom, will be
effective unless made in a writing signed by the party to be charged, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given. When accepted, this Letter Agreement and the other
Loan Documents will constitute the entire agreement between the Bank and the
Borrower concerning the Loan, and shall replace all prior understandings,
statements, negotiations and written materials relating to the Loan.
The Bank will not be responsible for any damages, consequential, incidental,
special, punitive or otherwise, that may be incurred or alleged by any person or
entity, including the Borrower and the Guarantor, as a result of this Letter
Agreement, the other Loan Documents, the transactions contemplated hereby or
thereby, or the use of proceeds of the Loan.
THE BORROWER AND THE BANK IRREVOCABLY WAIVE ANY AND ALL RIGHTS THEY MAY HAVE TO
A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE ARISING OUT OF
THIS LETTER AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS
CONTEMPLATED IN ANY OF SUCH DOCUMENTS AND ACKNOWLEDGE THAT THE FOREGOING WAIVER
IS KNOWING AND VOLUNTARY.
If and when a loan closing occurs, this Letter Agreement (as the same may be
amended from time to time) shall survive the closing and will serve as our loan
agreement throughout the term of the Loan.

 

 

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CSS Industries, Inc.
CSS Management LLC
August 1, 2008
Page 5
To accept these terms, please sign the enclosed copy of this Letter Agreement as
set forth below and the Loan Documents and return them to the Bank within [ten]
days from the date of this Letter Agreement, or this Letter Agreement may be
terminated at the Bank’s option without liability or further obligation of the
Bank.

            Very truly yours,

PNC BANK, NATIONAL ASSOCIATION
      By:   /s/ Frank Pugliese         Title: Senior Vice President   

ACCEPTANCE
With the intent to be legally bound hereby, the above terms and conditions are
hereby agreed to and accepted as of this 1st day of August, 2008.

            BORROWER:

CSS INDUSTRIES, INC.
      By:   /s/ Clifford E. Pietrafitta         Name:   Clifford E. Pietrafitta 
      Title:   Vice President – Finance        CSS MANAGEMENT LLC
      By:   /s/ Clifford E. Pietrafitta         Name:   Clifford E. Pietrafitta 
      Title:   Vice President