EXHIBIT 10.1
SECOND AMENDMENT TO LOAN AGREEMENT
THIS SECOND AMENDMENT TO LOAN AGREEMENT (this “Amendment”) is made as of this
28th day of September, 2010, 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
“Administrative Agent”) for the Lenders.
Background:
A. The Administrative Agent, the Lenders and the Borrower entered into a Second
Amended and Restated Loan Agreement dated as of November 21, 2008 (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. The Borrower has requested and the Administrative Agent and the Lenders have
agreed to amend certain of the provisions in the Loan Agreement with respect to
the Leverage Ratio covenant, 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. Amendment to Loan Agreement. The Loan Agreement is hereby amended effective
as of the date set forth above (the “Amendment Effective Date”) as follows:
Section 7.2 is amended and restated to read in full as follows:
“7.2 Leverage Ratio. The Borrower shall not permit, as of the end of each fiscal
quarter of the Borrower ending on the dates set forth below, the Leverage Ratio
to exceed the ratio set forth below opposite such dates:

      Period   Ratio
 
   
September 30
  3.50 to 1.00
December 31 and June 30
  2.50 to 1.00
March 31
  2.25 to 1.00

provided, however, that for the fiscal quarter ending September 30, 2010 the
required Leverage Ratio shall be 4.00 to 1.00.”

 

 

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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 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.
5. 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 Administrative Agent.
6. Conditions Precedent. The amendments set forth herein shall be effective as
of the Amendment Effective Date upon the fulfillment, to the satisfaction of the
Administrative Agent and its counsel, of the following conditions precedent:
(a) The Borrower shall have delivered to the Administrative Agent the following,
all of which shall be in form and substance satisfactory to the Administrative
Agent and shall be duly completed and executed:

  (i)   counterparts of this Amendment executed by the Borrower and the Majority
Lenders;

 

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  (ii)   the Consent and Acknowledgment of Guarantors attached as Exhibit A
hereto, executed by each Guarantor; and

  (iii)   such additional documents, certificates and information as the
Administrative 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.
(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.
7. Miscellaneous
(a) To induce the Administrative Agent and the Lenders to enter into this
Amendment each of the Borrower and the Guarantors waives and releases and
forever discharges the Administrative 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 Administrative
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. Each of the Borrower and the Guarantors 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 Administrative 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.

 

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(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.
The Borrower expressly ratifies and confirms the waiver of jury trial provisions
contained in the Loan Documents.
[Signature Pages to Follow]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
day and year first above written.

            CSS INDUSTRIES, INC.
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President — Finance   

 

 

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            PNC BANK, NATIONAL ASSOCIATION,
as a Lender and as Administrative Agent
      By:   /s/ Meredith Jermann         Name:   Meredith Jermann       
Title:   Vice President        WELLS FARGO BANK, N.A., successor in
interest to WACHOVIA BANK, NATIONAL
ASSOCIATION, as a Lender
      By:   /s/ Stephen T. Dorosh         Name:   Stephen T. Dorosh       
Title:   Vice President        CITIZENS BANK OF PENNSYLVANIA, as a Lender
      By:   /s/ Jonathan H. Sprogell         Name:   Jonathan H. Sprogell       
Title:   Senior Vice President        TD BANK, N.A., as a Lender
      By:   /s/ Ted Hopkinson         Name:   Ted Hopkinson        Title:  
Senior Vice President   

 

 

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EXHIBIT A
CONSENT AND ACKNOWLEDGMENT OF GUARANTORS
See Attached.

 

 

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CONSENT AND ACKNOWLEDGMENT OF GUARANTORS
Each of the undersigned guarantors (each a “Guarantor”) consents to the
provisions of the foregoing Second Amendment to Loan Agreement (the “Amendment”)
and confirms and agrees that: (a) such Guarantor’s obligations under its
Guaranty Agreement dated as of November 21, 2008 (as heretofore amended, the
“Guaranty”), relating to the Obligations (as defined in the Loan Agreement
referred to in the Amendment) shall be unimpaired by the Amendment; (b) such
Guarantor has no defenses, setoffs, counterclaims, discounts or charges of any
kind against the Agent or any Lender, or their respective officers, directors,
employees, agents or attorneys with respect to its Guaranty; (c) the provisions
of Paragraph 7(a) of the Amendment are binding on such Guarantor as if such
Guarantor signed the Amendment; and (d) all of the terms, conditions and
covenants in its Guaranty remain unaltered and in full force and effect and are
hereby ratified and confirmed and apply to the Obligations, as modified by the
Amendment. Each Guarantor certifies that all representations and warranties made
by such Guarantor in its Guaranty are true and correct in all material respects
as of the date hereof.
Each Guarantor expressly ratifies and confirms the waiver of jury trial
provisions contained in the Guaranty.
WITNESS the due execution of this Consent as of the date of the Amendment,
intending to be legally bound hereby.

            PAPER MAGIC GROUP, INC.,
a Pennsylvania corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President        BERWICK DELAWARE, INC.,
a Delaware corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   President        BERWICK OFFRAY LLC, a Delaware
limited liability company
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President   

 

 

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            CLEO INC., a Tennessee corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President        PHILADELPHIA INDUSTRIES,
INC., a Delaware
corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   President        LLM HOLDINGS, INC., Delaware
corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   President        THE PAPER MAGIC GROUP, INC.,
a Delaware corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   President        LION RIBBON COMPANY, INC., a
Delaware
corporation
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President        C.R GIBSON, LLC, a Delaware
limited liability
company
      By:   /s/ Vincent A. Paccapaniccia         Name:   Vincent A.
Paccapaniccia        Title:   Vice President