Exhibit 10.1

 
FIRST AMENDMENT TO CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AGREEMENT ("First Amendment"), made and entered
into as of the 8th day of July, 2008, by and among PHYSICIANS FORMULA, INC., a
New York corporation (the "Borrower"), the several banks and other lenders from
time to time parties to such Credit Agreement (the "Lenders"), and UNION BANK OF
CALIFORNIA, N.A. ("UBOC"), as administrative agent for the Lenders (in such
capacity, the "Agent"),
 
W I T N E S S E T H:
 
WHEREAS, on November 14, 2006, the Borrower, the Lenders and the Agent entered
into a certain Credit Agreement (the "Credit Agreement") pursuant to which the
Lenders agreed to make available to the Borrower certain credit facilities more
particularly described therein; and
 
WHEREAS, the Borrower, the Lenders and the Agent desire to reduce certain of the
pricing provided for in the Credit Agreement, subject, however, to the terms and
conditions set forth in this First Amendment;
 
NOW, THEREFORE, for and in consideration of the premises hereof, and other good
and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
 
    1.    All capitalized terms used in this First Amendment shall, unless
otherwise defined herein or unless the context otherwise requires, have the
meanings given thereto in the Credit Agreement.
 
    2.    Clause (x) of Section 2.3(e)(i) of the Credit Agreement is amended to
read "1.75% per annum and".
 
    3.    Section 2.8(a) of the Credit Agreement is amended to read as follows:
 
        (a)    Each Revolving Loan shall (i) if a LIBOR Loan, bear interest for
each day during each Interest Period with respect thereto at a rate per annum
equal to the LIBOR Adjusted Rate plus 1.75% and (ii) if a Base Rate Loan, bear
interest at a rate per annum equal to the Base Rate plus 0.25%.
 
    4.            Section 2.8(b) of the Credit Agreement is amended to read as
follows:
 
        (b)           Each Term Loan shall (i) if a LIBOR Loan, bear interest
for each day during each Interest Period with respect thereto at a rate per
annum equal to the LIBOR Adjusted Rate plus 1.75% and (ii) if a Base Rate Loan,
bear interest at a rate per annum equal to the Base Rate plus 0.25%.
 
    5.    This First Amendment shall become effective on the earlier of July 1,
2008 or the date on which the Agent receives this First Amendment, duly executed
by the Borrower and acknowledged and agreed to by each of the Pledgor and
Physicians Formula Cosmetics, Inc.
 
    6.    Except as expressly provided herein, the Credit Agreement is unchanged
and remains in full force and effect.
 
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    7.    This First Amendment shall be governed by and construed in accordance
with the laws of the State of California.
 
    8.    This First Amendment may be executed in any number of identical
counterparts, any set of which signed by all parties hereto shall be deemed to
constitute a complete, executed original for all purposes.
 
    IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have caused this
First Amendment to be executed as of the day and year first above written.
 

UNION BANK OF CALIFORNIA, N.A.     PHYSICIANS FORMULA, INC.      as Agent and
sole Lender                      
By:
/s/ Steve Dunne     
By:
/s/ Joseph J. Jaeger   
Title:
Vice President    
Title:
Chief Financial Officer  

 
ACKNOWLEDGED AND AGREED TO
this 8th day of July, 2008
 

PHYSICIANS FORMULA HOLDINGS, INC.      PHYSICIANS FORMULA COSMETICS, INC.      
                   
By:
/s/ Joseph J. Jaeger     
By:
/s/ Joseph J. Jaeger   
Title:
Chief Financial Officer    
Title:
Chief Financial Officer  

 
 
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