Exhibit 10.10

 

FLORISTS’ TRANSWORLD DELIVERY, INC.

FIRST AMENDMENT AND WAIVER TO AMENDED AND RESTATED CREDIT AGREEMENT

 

This First Amendment and Waiver to Amended and Restated Credit Agreement
(herein, the “Amendment”) is entered into as of July 31, 2003, by and among
Florists’ Transworld Delivery, Inc., a Michigan corporation (the “Borrower”),
FTD, Inc., a Delaware corporation (the “Parent”), the Subsidiaries listed on the
signature pages hereof, as Guarantors (and, in the case of FTD.COM INC.
(“FTD.COM”), as a new Credit Party as defined below), the several financial
institutions listed on the signature pages hereof, as Lenders, and Harris Trust
and Savings Bank, as Administrative Agent for the Lenders.

 

PRELIMINARY STATEMENTS

 

A.            The Borrower, the Parent, the Guarantors, the Lenders and the
Administrative Agent are parties to an Amended and Restated Credit Agreement
dated as of September 27, 2002 (the “Credit Agreement”).  All capitalized terms
used herein without definition shall have the same meanings herein as such terms
have in the Credit Agreement.

 

B.            The Parent and the Borrower (collectively, the “Notice Parties”)
have notified the Administrative Agent and the Lenders that the Parent and
FTD.COM have entered into or intend to enter into a Settlement Agreement (the
“Settlement Agreement”) relating to the proposed settlement of consolidated
class action litigation currently pending in the Court of Chancery for New
Castle County in Wilmington, Delaware (the “Court”), captioned Highwood
Partners, L.P. v. IOS Brands Corp., Civil Action No. 19556 NC, which Settlement
Agreement will provide for the making of a payment in cash, equity of the Parent
or a combination thereof, by either or both of the Parent and FTD.COM.  The
actual amount of such payment made in connection with the Settlement Agreement,
with any equity portion of such payment valued based on the market price(s)
thereof on the Valuation Date, is referred to herein as the “Settlement
Amount”.  As used herein, “Valuation Date” means a date (or may refer
collectively to several dates, if an average of the market price of securities
of the Parent on several dates is used for purposes of such calculation) after
the date hereof which is agreed upon by the parties to the Settlement Agreement
for the purpose of calculating the value of securities of the Parent to be
distributed as all or part of the Settlement Amount.

 

C.            The Notice Parties have requested that the Lenders (i) waive
certain Events of Default under the Credit Agreement which might be caused, and
(ii) amend certain provisions of the Credit Agreement which might be affected,
in either case by the entry into the Settlement Agreement or the payment
(whether in cash, equity of the Parent, or a combination thereof) of the
Settlement Amount.

 

D.            The Notice Parties have also requested that the Lenders amend the
Fixed Charge Coverage Ratio, add FTD.COM as a borrower under the Credit
Agreement, and make certain other changes to the Credit Agreement, all as more
fully set forth below.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

--------------------------------------------------------------------------------

 

SECTION 1.           WAIVER.

 

By signing below, subject to the satisfaction of the conditions precedent set
forth below, the Lenders hereby waive:

 

(a) any violation of Section 8.12 (Dividends and Certain Other Restricted
Payments) of Credit Agreement which could or would otherwise be caused by the
entry into the Settlement Agreement or the payment (whether in cash, equity of
the Parent, or a combination thereof) of the Settlement Amount in an amount not
to exceed $12,000,000, with any equity portion of such payment valued based on
the market price(s) thereof on the Valuation Date (the “Maximum Settlement
Amount”), as well as any Default or Event of Default which could or would
otherwise result from such violations;

 

(b) any violation of Section 8.24 (Fixed Charge Coverage Ratio) of the Credit
Agreement for the four fiscal quarter period ended June 30, 2003 which could or
would otherwise be caused by the entry into the Settlement Agreement or the
payment (whether in cash, equity of the Parent, or a combination thereof) of the
Settlement Amount in an amount not to exceed the Maximum Settlement Amount, as
well as any Default or Event of Default which could or would otherwise result
from such violations; and

 

(c) any Default or Event of Default under Section 9.1(g) of the Credit Agreement
which could or would otherwise result from the entry into the Settlement
Agreement or the related entry by the Court of a final order and judgment with
respect to the Settlement Agreement, provided that the Parent and FTD.COM comply
with the terms of the Settlement Agreement as entered in such final order and
judgment.

 

SECTION 2.           AMENDMENTS.

 

Subject to the satisfaction of the conditions precedent set forth in Section 3
below, the Credit Agreement shall be and hereby is amended as follows:

 

2.1.          Section 1.1 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 1.1.           Revolving Credit Commitments.  Subject to the terms and
conditions hereof, each Lender, by its acceptance hereof, severally agrees to
make a loan or loans (individually a “Revolving Loan” and collectively the
“Revolving Loans”) to the Credit Parties from time to time on a revolving basis
up to the amount of such Lender’s Revolving Credit Commitment, subject to any
reductions thereof pursuant to the terms hereof, before the Termination Date. 
The sum of the aggregate principal amount of Revolving Loans, Swing Loans and
L/C Obligations at any time outstanding shall not exceed the Revolving Credit
Commitments in effect at such time. Each Borrowing of Revolving Loans shall be

 

2

--------------------------------------------------------------------------------

 

made ratably from the Lenders in proportion to their respective Revolver
Percentages.  As provided in Section 1.5(a) hereof, the applicable Credit Party
may elect that each Borrowing of Revolving Loans be either Base Rate Loans or
Eurodollar Loans. Revolving Loans may be repaid and the principal amount thereof
reborrowed before the Termination Date, subject to the terms and conditions
hereof.

 

2.2.          Sections 1.5, 1.7, 1.8(a), 1.9, 1.10, 1.11(c), 1.12, 1.14, 7.1
(final paragraph only), 10.1 (second sentence only), 10.3(a),  Exhibit F
(numbered paragraph 8 only) of the Credit Agreement shall be amended by deleting
the word “Borrower” each time it appears and replacing it with the words
“applicable Credit Party”.

 

2.3.          The definitions of “Authorized Representative” and “Borrowing” set
forth in Section 5.1 of the Credit Agreement shall be amended by deleting the
word “Borrower” each time it appears and replacing it with the words “applicable
Credit Party”.

 

2.4.          Sections 6.7, 6.9 and 6.11 of the Credit Agreement shall be
amended by deleting the words “the Borrower” each time they appear and replacing
them with the words “each Credit Party”.

 

2.5.          Section 6.12 (first usage in the second sentence only),
Section 8.7(a), Section 10.4 (second sentence only), Section 11.5
(second-to-last sentence only), Section 11.6, Section 11.7 (last sentence only),
Section 13.8 and Section 13.11 of the Credit Agreement shall be amended by
deleting the words “the Borrower” each time they appear and replacing them with
the words “the Credit Parties”.

 

2.6.          Section 8.5(h), Section 8.5(i), Section 11.1 and Section 11.3 of
the Credit Agreement shall be amended by deleting the words “the Borrower” each
time they appear and replacing them with the words “either Credit Party”.

 

2.7.          Section 1.11(a) of the Credit Agreement shall be amended and
restated to read in its entirety as follows:

 

Section 1.11.        The Notes. (a) The Revolving Loans made to the Borrower by
a Lender shall be evidenced by a single promissory note of the Borrower issued
to such Lender in the form of Exhibit D-1 hereto.  The Revolving Loans made to
FTD.COM by a Lender shall be evidenced by a single promissory note of FTD.COM
issued to such Lender in the form of Exhibit D-3 hereto. Each such promissory
note is hereinafter referred to as a “Revolving Note” and collectively such
promissory notes are referred to as the “Revolving Notes”.

 

3

--------------------------------------------------------------------------------

 

2.8.          Section 3.1 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

SECTION 3.           PLACE AND APPLICATION OF PAYMENTS.

 

Section 3.1.           Place and Application of Payments.  All payments of
principal of and interest on the Loans and the Reimbursement Obligations, and of
all other Obligations payable by either Credit Party under this Agreement and
the other Loan Documents, shall be made by the applicable Credit Party to the
Administrative Agent by no later than 12:00 Noon (Chicago time) on the due date
thereof at the office of the Administrative Agent in Chicago, Illinois (or such
other location as the Administrative Agent may designate to the Credit Parties)
for the benefit of the Lender or Lenders entitled thereto.  Any payments
received after such time shall be deemed to have been received by the
Administrative Agent on the next Business Day.  All such payments shall be made
in U.S. Dollars, in immediately available funds at the place of payment, in each
case without set-off or counterclaim.  The Administrative Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal or interest on Loans and on Reimbursement Obligations in which the
Lenders have purchased Participating Interests ratably to the Lenders and like
funds relating to the payment of any other amount payable to any Lender to such
Lender, in each case to be applied in accordance with the terms of this
Agreement.

 

Anything contained herein to the contrary notwithstanding, all payments and
collections received in respect of the Obligations and all proceeds of the
Collateral received, in each instance, by the Administrative Agent or any of the
Lenders after the occurrence and during the continuation of an Event of Default
shall be remitted to the Administrative Agent and distributed as follows:

 

(a)           first, to the payment of any outstanding costs and expenses
incurred by the Administrative Agent, and any security trustee therefor, in
monitoring, verifying, protecting, preserving or enforcing the Liens on the
Collateral, in protecting, preserving or enforcing rights under the Loan
Documents, and in any event all costs and expenses of a character which either
Credit Party has agreed to pay the Administrative Agent under Section 13.15
hereof (such funds to be retained by the Administrative Agent for its own
account unless it has previously been reimbursed for such costs and expenses by
the Lenders, in which event such amounts shall be

 

4

--------------------------------------------------------------------------------

 

remitted to the Lenders to reimburse them for payments theretofore made to the
Administrative Agent);

 

(b)           second, to the payment of principal and interest on the Swing Line
Note;

 

(c)           third, to the payment of principal and interest on the Revolving
Notes, unpaid Reimbursement Obligations, together with amounts to be held by the
Administrative Agent as collateral security for any outstanding L/C Obligations
(until the Administrative Agent is holding an amount of cash equal to the then
outstanding amount of all such L/C Obligations), unpaid fees and other
Obligations due under the Loan Documents, the aggregate amount paid to, or held
as collateral security for, the Lenders and, in the case of Hedging Liability,
their Affiliates to whom such Obligations are owed, to be allocated pro rata in
accordance with the aggregate unpaid amounts owing to each; and

 

(d)           fourth, to the Credit Parties or whoever else may be lawfully
entitled thereto.

 

2.9.          Section 5.1 of the Credit Agreement shall be amended by adding the
following new defined terms thereto, each in its appropriate place in the
alphabetical sequence, each such definition to read in its entirety as follows:

 

“Credit Parties” means, collectively, the Borrower and FTD.COM, and “Credit
Party” means either of such Persons as the context may require.

 

“First Amendment” means that certain First Amendment and Waiver to Amended and
Restated Credit Agreement dated as of July 31, 2003 among the Parent, the
Borrower, FTD.COM, the Subsidiaries, the Lenders and Harris Trust and Savings
Bank, as Administrative Agent.

 

“First Amendment Effective Date” means the date upon which the First Amendment
becomes effective pursuant to its terms.

 

“Maximum Settlement Amount” shall have the meaning set forth in the First
Amendment.

 

“Settlement Agreement” and “Settlement Amount” shall have the meanings set forth
in the First Amendment.

 

5

--------------------------------------------------------------------------------

 

2.10.        The last sentence of the definition of “Applicable Margin” set
forth in Section 5.1 of the Credit Agreement shall be amended and restated to
read in its entirety as follows:

 

Each determination of the Applicable Margin made by the Administrative Agent in
accordance with the foregoing shall be conclusive and binding on the Credit
Parties and the Lenders absent manifest error.

 

2.11.        Section 5.1 of the Credit Agreement shall be amended by amending
and restating each of the  following defined terms set forth therein, each such
definition as so amended and restated to read in its entirety as follows:

 

“Change of Control” means any of (a) the acquisition by any “person” or “group”
(as such terms are used in sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended), other than the Current Stockholders or any of their
Affiliates, at any time of beneficial ownership of a majority of the outstanding
capital stock of the Parent on a fully-diluted basis, (b) the failure of
individuals who are members of the board of directors of the Parent on the
Closing Date (together with any new or replacement directors whose initial
nomination for election was approved by a majority of the directors or members
of the nominating committee therefor who were either directors or members of
such committee on the Closing Date or previously so approved) to constitute a
majority of the board of directors of the Parent, and (c) the Parent shall fail
to own 100% of the outstanding capital stock of either or both of the Credit
Parties on a fully-diluted basis.

 

“EBITDA” means, with reference to any period, Net Income for such period plus
the sum of all amounts deducted in arriving at such Net Income amount in respect
of (a) Interest Expense for such period, (b) foreign, federal, state and local
income taxes for such period, (c) depreciation expense related to fixed assets
and amortization expense including without limitation with respect to goodwill
and other intangible assets for such period, (d) payments comprising any portion
of the Settlement Amount (provided that the aggregate amount included in EBITDA
pursuant to this clause (d) during the term of the Agreement may not exceed the
Maximum Settlement Amount), and (e) minority interest expense; plus or minus, as
the case may be, extraordinary non-cash losses or gains; minus any amounts
included in Net Income for such period which were received in reimbursement of
or compensation for any payment of any portion of the Settlement Amount (whether
from the proceeds of a policy of insurance or

 

6

--------------------------------------------------------------------------------

 

otherwise); provided, however, that EBITDA for the relevant period shall be
calculated on a pro forma basis in good faith by the Parent and established to
the reasonable satisfaction of the Administrative Agent based on financial
information provided by the Borrower as if each Permitted Acquisition which
occurred during such period had taken place on the first day of such period
(including adjustments for non-recurring expenses and income reasonably
determined by the Parent in good faith and established to the reasonable
satisfaction of the Administrative Agent).

 

“Fixed Charges” means, with reference to any period, the sum of (a) all
scheduled payments of principal on Indebtedness for Borrowed Money of the Parent
and the Subsidiaries paid or required to be paid in cash during such period,
plus (b) foreign, federal, state and local income taxes of the Parent and the
Subsidiaries paid or required to be paid in cash during such period, plus (c)
Interest Expense of the Parent and the Subsidiaries paid or required to be paid
in cash during period, plus (d) Restricted Payments (other than (i) Restricted
Payments of the type described in clause (z) of the definition of such term and
(ii) Restricted Payments which comprise any portion of the payment of the
Settlement Amount) of the Parent and the Subsidiaries made in cash during such
period.

 

“Obligations” means all obligations of the Credit Parties to pay principal and
interest on the Loans, all Reimbursement Obligations owing under the
Applications, all fees and charges payable hereunder, all Hedging Liability, and
all other payment obligations of the Parent, the Borrower or any Subsidiary
arising under or in relation to any Loan Document, in each case whether now
existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired.

 

“Revolving Credit Commitment” means, as to any Lender, the obligation of such
Lender to make Revolving Loans to the Credit Parties and to participate in
Letters of Credit issued for the account of the Borrower hereunder in an
aggregate principal or face amount at any one time outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 1 attached hereto and
made a part hereof, as the same may be reduced or modified at any time or from
time to time pursuant to the terms hereof.  The Credit Parties and the Lenders
acknowledge and agree that the Revolving Credit Commitments of the Lenders
aggregate $75,000,000 on the First Amendment Effective Date.

 

7

--------------------------------------------------------------------------------

 

2.12.        The introductory language to Section 6 of the Credit Agreement
shall be amended and restated to read in its entirety as follows:

 

SECTION 6.           REPRESENTATIONS AND WARRANTIES.

 

Each of the Parent and each Credit Party represents and warrants to the
Administrative Agent and the Lenders as follows:

 

2.13.        Section 6.3 of the Credit Agreement shall be amended by deleting
the first sentence thereof and replacing it with a new sentence to read in its
entirety as follows:

 

Each Credit Party has full right and authority to enter into this Agreement and
the other Loan Documents executed by it, to make the borrowings herein provided
for, to issue its Notes in evidence thereof, to grant to the Administrative
Agent the Liens described in the Collateral Documents executed by it, and to
perform all of its obligations hereunder and under the other Loan Documents
executed by it.

 

2.14.        Section 6.4 of the Credit Agreement shall be amended by deleting
the first sentence thereof and replacing it with a new sentence to read in its
entirety as follows:

 

The Credit Parties shall use the proceeds of the Revolving Credit for their
general working capital purposes and for such other legal and proper purposes as
are consistent with all applicable laws.

 

2.15.        Section 6.11 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 6.11.        Litigation and Other Controversies.  Other than the
litigation in connection with which the Parent and FTD.COM have entered into the
Settlement Agreement, there is no litigation or governmental proceeding or labor
controversy pending, nor to the knowledge of the Parent or the Borrower
threatened, against the Parent, the Borrower or any Subsidiary which if
adversely determined could reasonably be expected to have a Material Adverse
Effect.

 

2.16.        Section 6.17(b) of the Credit Agreement shall be amended and
restated to read in its entirety as follows:

 

(b)           Without limiting the representations and warranties set forth in
Section 6.17(a) above, except for such matters which could not reasonably be
expected to result in a Material Adverse Effect, the Parent and the Credit
Parties represent and warrant that:

 

8

--------------------------------------------------------------------------------

 

(i) the Parent, the Borrower and the Subsidiaries, and each of the Premises,
comply in all material respects with all applicable Environmental Laws; (ii) the
Parent, the Borrower and the Subsidiaries have each obtained all material
governmental approvals required for their operations and each of the Premises by
any applicable Environmental Law; (iii) each of the Parent and the Credit
Parties has no knowledge of any release, threatened release or disposal of any
Hazardous Material at, on, or about, any of the Premises in any material
quantity and, to the knowledge of each of the Parent and the Credit Parties,
none of the Premises are materially adversely affected by any release,
threatened release or disposal of a Hazardous Material originating or emanating
from any other property; (iv) to the knowledge of each of the Parent and the
Credit Parties, none of the Premises contain or have contained any: (1) material
amounts of asbestos containing building material in material non-compliance with
any Environmental Law, (2) landfills or dumps, (3) hazardous waste treatment,
storage or disposal facility as defined pursuant to RCRA or any comparable state
law, or (4) site on or nominated for the National Priority List promulgated
pursuant to CERCLA or any state remedial priority list promulgated or published
pursuant to any comparable state law; (v) the Parent, the Borrower and the
Subsidiaries have not used a material quantity of any Hazardous Material and
have conducted no Hazardous Material Activity at any of the Premises except in
material compliance with applicable Environmental Laws; (vi) each of the Parent
and the Credit Parties has no knowledge of any material liability for response
or corrective action, natural resource damage or other harm pursuant to CERCLA,
RCRA or any comparable state law; (vii) the Parent, the Borrower and the
Subsidiaries have no notice or knowledge of and are not required to give any
notice of any Environmental Claim involving the Parent,  the Borrower or any
Subsidiary or any of the Premises, and the Parent and the Credit Parties have no
knowledge of any conditions or occurrences at any of the Premises which could
reasonably be anticipated to form the basis for an Environmental Claim against
the Borrower or any Subsidiary or such Premises; (viii) none of the Premises are
subject to any, and the Parent and the Credit Parties have no knowledge of any
imminent, restriction on the ownership, occupancy, use or transferability of the
Premises in connection with any (1) Environmental Law or (2) release, threatened
release or disposal of a Hazardous Material; and (ix) the Parent and the Credit
Parties have no knowledge of any conditions or circumstances at any of the
Premises which pose an unreasonable risk to the environment or the health or
safety of Persons.

 

9

--------------------------------------------------------------------------------

 

2.17.        The introductory language to Section 8 of the Credit Agreement
shall be amended and restated to read in its entirety as follows:

 

SECTION 8.           COVENANTS.

 

Each of the Credit Parties and, where and to the extent specifically indicated,
the Parent agrees that, so long as any credit is available to or in use by
either Credit Party hereunder, except to the extent compliance in any case or
cases is waived in writing pursuant to the terms of Section 13.13 hereof:

 

2.18.        Section 8.10(c) of the Credit Agreement shall be amended and
restated to read in its entirety as follows:

 

(c)           the merger of any Subsidiary (other than the Borrower) with and
into the Borrower or any Subsidiary provided that, in the case of any merger
involving a Credit Party, a Credit Party is the corporation surviving the
merger, and in the case of any merger involving the Borrower, the Borrower is
the corporation surviving the merger;

 

2.19.        Section 8.18 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 8.18.        Change in the Nature of Business.  Neither the Parent nor
the Borrower shall, nor shall it permit any Subsidiary to, engage in any
business or activity if as a result the general nature of the business of the
Parent, the Borrower and the Subsidiaries taken as a whole would be changed in
any material respect from the general nature of the business engaged in by such
entities taken as a whole as of the Closing Date.

 

2.20.        Section 8.19 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 8.19.        Use of Loan Proceeds.  The Credit Parties shall use the
credit extended under this Agreement solely for the purposes set forth in, or
otherwise permitted by, Section 6.4 hereof.

 

2.21.        Section 8.24  of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 8.24.        Fixed Charge Coverage Ratio.  As of the last day of each
fiscal quarter of the Parent, the Parent shall maintain a ratio of (a) EBITDA
less Capital Expenditures for the

 

10

--------------------------------------------------------------------------------

 

four fiscal quarters of the Parent and the Subsidiaries then ended to (b)  
Fixed Charges for the same four fiscal quarters then ended of not less than (i)
1.75 to 1.0 if Total Funded Debt was less than $25,000,000 on such date, and
(ii) 2.0 to 1.0 at all other times.

 

2.22.        A new Section 8.27 shall be added to the Credit Agreement
immediately following Section 8.26, reading in its entirety as follows:

 

Section 8.27.        Undertaking of FTD.COM.  To the extent that any provision
in this Agreement or any other Loan Document requires the Parent or the Borrower
to cause FTD.COM to take or omit any action or to prevent FTD.COM from taking or
omitting any action, FTD.COM separately and independently agrees with the
Administrative Agent and the Lenders to take or omit such action, as the case
may be, to the same extent as if such provision were directly addressed to it.

 

2.23.        Section 9.1(c) of the Credit Agreement shall be amended and
restated to read in its entirety as follows:

 

(c)           default in the observance or performance of (1) any requirement
set forth in the second sentence of Section 8.1 hereof which can be cured after
a temporary lapse if such lapse does not exceed 30 days and would not reasonably
be expected to have a Material Adverse Effect, (2) any violation of Section 8.7
or 8.8 hereof resulting from an involuntary or immaterial incurrence of
indebtedness or of a Lien, as the case may be, (3) any violation of any of
clauses (a), (b), (c), (d), (e), (g), (h), (i), (k) or (l) of Section 8.9 hereof
resulting from an involuntary or immaterial investment, or (4) any other
provision hereof or of any other Loan Document which, in the case of any of the
defaults described in subclauses (1), (2), (3) or (4) of this clause (c), is not
remedied within 30  days after the earlier of (i) the date on which such failure
shall first become known to any officer of the Parent or either Credit Party or
(ii)  written notice thereof is given to the Borrower by the Administrative
Agent;

 

2.24.        Section 9.6 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 9.6.           Expenses.  The Credit Parties jointly and severally agree
to pay to the Administrative Agent and each Lender, and any other holder of any
Note outstanding hereunder, all expenses reasonably incurred or paid by the
Administrative Agent and such Lender or any such holder, including reasonable

 

11

--------------------------------------------------------------------------------

 

attorneys’ fees (including allocated costs of in-house counsel) and court costs,
in connection with any Default or Event of Default hereunder or in connection
with the enforcement of any of the Loan Documents (including all such costs and
expenses arising in connection with a proceeding under the United States
Bankruptcy Code).

 

2.25.        Each of Sections 12.1 through 12.7 of the Credit Agreement shall be
amended and restated to read in its entirety as follows:

 

SECTION 12.         THE GUARANTY.

 

Section 12.1.        The Guaranty.  To induce the Lenders to provide the credits
described herein and in consideration of benefits expected to accrue to the
Credit Parties by reason of the Commitments and for other good and valuable
consideration, receipt of which is hereby acknowledged, the Parent and each of
its direct and indirect Domestic Subsidiaries (individually each a “Guarantor”
and collectively the “Guarantors”), hereby unconditionally and irrevocably
guarantee jointly and severally to the Administrative Agent, the Lenders, and
each other holder of any of the Obligations or Hedging Liability, (x) the due
and punctual payment of all present and future indebtedness of the Credit
Parties evidenced by or arising out of the Loan Documents, including, but not
limited to, the due and punctual payment of principal of and interest on the
Notes, the Reimbursement Obligations, and the due and punctual payment of all
other Obligations now or hereafter owed by either Credit Party under the Loan
Documents as and when the same shall become due and payable, whether at stated
maturity, by acceleration or otherwise, according to the terms hereof and
thereof, and (y) the due and punctual payment of all present and future Hedging
Liability as and when the same shall become due and payable, whether at its
stated maturity, by acceleration or otherwise, according to the terms thereof,
provided that neither Credit Party shall be understood to be a Guarantor of any
Obligations or Hedging Liability with respect to which it is the primary
obligor.  In case of failure by any Credit Party punctually to pay any
indebtedness or other Obligations guaranteed hereby (after giving effect to any
applicable cure periods), each Guarantor hereby unconditionally agrees jointly
and severally to make such payment or to cause such payment to be made
punctually as and when the same shall become due and payable, whether at stated
maturity, by acceleration or otherwise, and as if such payment were made by the
applicable Credit Party.

 

12

--------------------------------------------------------------------------------

 

Section 12.2.        Guarantee Unconditional.  The obligations of each Guarantor
as a guarantor under this Section 12 shall be unconditional and absolute and,
without limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:

 

(a)           any extension, renewal, settlement, compromise, waiver or release
in respect of any obligation of any Credit Party or of any other guarantor under
this Agreement or any other Loan Document or by operation of law or otherwise;

 

(b)           any modification or amendment of or supplement to this Agreement
or any other Loan Document;

 

(c)           any change in the corporate existence, structure or ownership of,
or any insolvency, bankruptcy, reorganization or other similar proceeding
affecting, any Credit Party, any other guarantor, or any of their respective
assets, or any resulting release or discharge of any obligation of any Credit
Party or of any other guarantor contained in any Loan Document;

 

(d)           the existence of any claim, set-off or other rights which any
Credit Party or any other guarantor may have at any time against the
Administrative Agent, any Lender or any other Person, whether or not arising in
connection herewith;

 

(e)           any failure to assert, or any assertion of, any claim or demand or
any exercise of, or failure to exercise, any rights or remedies against any
Credit Party, any other guarantor or any other Person or Property;

 

(f)            any application of any sums by whomsoever paid or howsoever
realized to any obligation of any Credit Party, regardless of what obligations
of any Credit Party remain unpaid;

 

(g)           any invalidity or unenforceability relating to or against any
Credit Party or any other guarantor for any reason of this Agreement or of any
other Loan Document or any provision of applicable law or regulation purporting
to prohibit the payment by any Credit Party or any other guarantor of the
principal of or interest on any Note or any Reimbursement Obligation or any
other amount payable under the Loan Documents; or

 

(h)           any other act or omission to act or delay of any kind by the
Administrative Agent, any Lender or any other Person or

 

13

--------------------------------------------------------------------------------

 

any other circumstance whatsoever that might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of the obligations of any
Guarantor under this Section 12.

 

Section 12.3.        Discharge Only Upon Payment in Full; Reinstatement in
Certain Circumstances.  Each Guarantor’s obligations under this Section 12 shall
remain in full force and effect until the Commitments are terminated, all
Letters of Credit have expired, and the principal of and interest on the Notes
and all other amounts payable by any Credit Party under this Agreement and all
other Loan Documents shall have been paid in full.  If at any time any payment
of the principal of or interest on any Note or any Reimbursement Obligation or
any other amount payable by any Credit Party under the Loan Documents is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of any Credit Party or of any guarantor, or
otherwise, each Guarantor’s obligations under this Section 12 with respect to
such payment shall be reinstated at such time as though such payment had become
due but had not been made at such time.

 

Section 12.4.        Subrogation.  Each Guarantor agrees it will not exercise
any rights which it may acquire by way of subrogation by any payment made
hereunder, or otherwise, until all the Obligations shall have been paid in full
subsequent to the termination of all the Commitments and expiration of all
Letters of Credit.  If any amount shall be paid to a Guarantor on account of
such subrogation rights at any time prior to the later of (x) the payment in
full of the Obligations and all other amounts payable by the Credit Parties
hereunder and the other Loan Documents and (y) the termination of the
Commitments and expiration of all Letters of Credit, such amount shall be held
in trust for the benefit of the Administrative Agent and the Lenders and shall
forthwith be paid to the Administrative Agent for the benefit of the Lenders or
be credited and applied upon the Obligations, whether matured or unmatured, in
accordance with the terms of this Agreement.

 

Section 12.5.        Waivers.  Each Guarantor irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by the
Administrative Agent, any Lender or any other Person against any Credit Party,
another guarantor or any other Person.

 

14

--------------------------------------------------------------------------------

 

Section 12.6.        Limit on Recovery.  Notwithstanding any other provision
hereof, the right of recovery against each Guarantor under this Section 12 shall
not exceed $1.00 less than the lowest amount which would render such Guarantor’s
obligations under this Section 12 void or voidable under applicable law,
including without limitation fraudulent conveyance law.

 

Section 12.7.        Stay of Acceleration.  If acceleration of the time for
payment of any amount payable by any Credit Party under this Agreement or any
other Loan Document is stayed upon the insolvency, bankruptcy or reorganization
of such Credit Party, all such amounts otherwise subject to acceleration under
the terms of this Agreement or the other Loan Documents shall nonetheless be
payable jointly and severally by the Guarantors hereunder forthwith on demand by
the Administrative Agent made at the request of the Required Lenders.

 

2.26.        Each of Sections 13.1(a), (b) and (c) of the Credit Agreement shall
be amended and restated to read in its entirety as follows:

 

Section 13.1.        Withholding Taxes.  (a) Payments Free of Withholding. 
Except as otherwise required by law and subject to Section 13.1(b) hereof, each
payment by any Credit Party or any Guarantor under this Agreement or the other
Loan Documents shall be made without withholding for or on account of any
present or future taxes (other than overall net income taxes on the recipient)
imposed by or within the jurisdiction in which the applicable Credit Party or
Guarantor is domiciled, any jurisdiction from which the applicable Credit Party
or Guarantor makes any payment, or (in each case) any political subdivision or
taxing authority thereof or therein.  If any such withholding is so required,
the applicable Credit Party or Guarantor shall make the withholding, pay the
amount withheld to the appropriate governmental authority before penalties
attach thereto or interest accrues thereon and forthwith pay such additional
amount as may be necessary to ensure that the net amount actually received by
each Lender and the Administrative Agent free and clear of such taxes (including
such taxes on such additional amount) is equal to the amount which that Lender
or the Administrative Agent (as the case may be) would have received had such
withholding not been made.  If the Administrative Agent or any Lender pays any
amount in respect of any such taxes, penalties or interest, the applicable
Credit Party or Guarantor shall reimburse the Administrative Agent or such
Lender for that payment on demand in the currency in which such payment was
made.  If the applicable Credit Party or

 

15

--------------------------------------------------------------------------------

 

Guarantor pays any such taxes, penalties or interest, it shall deliver official
tax receipts evidencing that payment or certified copies thereof to the Lender
or Administrative Agent on whose account such withholding was made (with a copy
to the Administrative Agent if not the recipient of the original) on or before
the thirtieth day after payment.

 

(b)           U.S. Withholding Tax Exemptions.  Each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the Borrower and the Administrative Agent on or before the date the
initial Credit Event is made hereunder or, if later, the date such financial
institution becomes a Lender hereunder, two duly completed and signed copies of
(i) either Form W-8 BEN (relating to such Lender and entitling it to a complete
exemption from withholding under the Code on all amounts to be received by such
Lender, including fees, pursuant to the Loan Documents and the Obligations) or
Form W-8 ECI (relating to all amounts to be received by such Lender, including
fees, pursuant to the Loan Documents and the Obligations) of the United States
Internal Revenue Service or (ii) solely if such Lender is claiming exemption
from United States withholding tax under Section 871(h) or 881(c) of the Code
with respect to payments of “portfolio interest”, a Form W-8 BEN, or any
successor form prescribed by the Internal Revenue Service, and a certificate
representing that such Lender is not a bank for purposes of Section 881(c) of
the Code, is not a 10-percent shareholder (within the meaning of
Section 871(h)(3)(B) of the Code) of any Credit Party and is not a controlled
foreign corporation related to any Credit Party (within the meaning of
Section 864(d)(4) of the Code).  Thereafter and from time to time, each Lender
shall submit to the Borrower and the Administrative Agent such additional duly
completed and signed copies of one or the other of such Forms (or such successor
forms as shall be adopted from time to time by the relevant United States taxing
authorities) and such other certificates as may be (i) requested by the Borrower
in a written notice, directly or through the Administrative Agent, to such
Lender and (ii) required under then-current United States law or regulations to
avoid or reduce United States withholding taxes on payments in respect of all
amounts to be received by such Lender, including fees, pursuant to the Loan
Documents or the Obligations.  Upon the request of the Borrower or the
Administrative Agent, each Lender that is a United States person (as such term
is defined in Section 7701(a)(30) of the Code) shall submit to the Borrower and

 

16

--------------------------------------------------------------------------------

 

the Administrative Agent a certificate to the effect that it is such a United
States person.

 

(c)           Inability of Lender to Submit Forms.  If any Lender determines, as
a result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof, that it is unable to submit to
the Borrower or the Administrative Agent any form or certificate that such
Lender is obligated to submit pursuant to subsection (b) of this Section 13.1 or
that such Lender is required to withdraw or cancel any such form or certificate
previously submitted or any such form or certificate otherwise becomes
ineffective or inaccurate, such Lender shall promptly notify the Borrower and
Administrative Agent of such fact and the Lender shall to that extent not be
obligated to provide any such form or certificate and will be entitled to
withdraw or cancel any affected form or certificate, as applicable.

 

2.27.        Section 13.10 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 13.10. Successors and Assigns.  This Agreement shall be binding upon the
Credit Parties and the Guarantors and their successors and assigns, and shall
inure to the benefit of the Administrative Agent and each of the Lenders and the
benefit of their respective successors and assigns, including any subsequent
holder of any of the Obligations.  Neither any Credit Party nor any Guarantor
may assign any of its rights or obligations under any Loan Document without the
written consent of all of the Lenders.

 

2.28.        Each of Sections 13.12(a), (b) and (c) of the Credit Agreement
shall be amended and restated to read in its entirety as follows:

 

Section 13.12. Assignments.  (a) Each Lender shall have the right at any time,
with the prior consent of the Administrative Agent and, so long as no Event of
Default then exists, the Borrower (which consent of the Borrower shall not be
unreasonably withheld) to sell, assign, transfer or negotiate all or any part of
its rights and obligations under the Loan Documents (including, without
limitation, the indebtedness evidenced by the Notes then held by such assigning
Lender, together with an equivalent percentage of its obligation to make Loans
and participate in Letters of Credit) to one or more commercial banks or other
financial institutions or investors, provided that, unless otherwise agreed to
by the Administrative Agent, such assignment shall be of a fixed percentage (and
not by its terms of varying

 

17

--------------------------------------------------------------------------------

 

percentage) of the assigning Lender’s rights and obligations under the Loan
Documents; provided, however, that in order to make any such assignment, (i)
unless the assigning Lender is assigning all of its Commitments, outstanding
Loans and interests in Letters of Credit Obligations, the assigning Lender shall
retain at least $5,000,000 in unused Commitments, outstanding Loans and
interests in Letters of Credit, (ii) the assignee Lender shall have Commitments,
outstanding Loans and interests in Letters of Credit of at least $5,000,000,
(iii) each such assignment shall be evidenced by a written agreement
(substantially in the form attached hereto as Exhibit F or in such other form
acceptable to the Administrative Agent) executed by such assigning Lender, such
assignee Lender or Lenders, the Administrative Agent and, if required as
provided above, the Borrower, which agreement shall specify in each instance the
portion of the Obligations which are to be assigned to the assignee Lender and
the portion of the Commitments of the assigning Lender to be assumed by the
assignee Lender, (iv) the Swing Loans and Swing Line Commitment shall only be
assigned (if at all) in total and (v) the assigning Lender shall pay to the
Administrative Agent a processing fee of $3,500 and any out-of-pocket attorneys’
fees and expenses incurred by the Administrative Agent in connection with any
such assignment agreement.  Any such assignee shall become a Lender for all
purposes hereunder to the extent of the rights and obligations under the Loan
Documents it assumes and the assigning Lender shall be released from its
obligations, and will have released its rights, under the Loan Documents to the
extent of such assignment.  The address for notices to such assignee Lender
shall be as specified in the assignment agreement executed by it. Promptly upon
the effectiveness of any such assignment agreement, the Credit Parties shall
execute and deliver replacement Notes to the assignee Lender and the assigning
Lender in the respective amounts of their Commitments (or assigned principal
amounts, as applicable) after giving effect to the reduction occasioned by such
assignment (all such Notes to constitute “Notes” for all purposes of the Loan
Documents), and the assignee Lender shall thereafter surrender to the Credit
Parties its old Notes. The Credit Parties authorize each Lender to disclose to
any purchaser or prospective purchaser of an interest in the Loans and interest
in Letters of Credit owed to it or its Commitments under this Section any
financial or other information pertaining to the Credit Parties or any
Subsidiary.

 

(b)           Any Lender may at any time pledge or grant a security interest in
all or any portion of its rights under this

 

18

--------------------------------------------------------------------------------

 

Agreement to secure obligations of such Lender, including any such pledge or
grant to a Federal Reserve Bank, and this Section shall not apply to any such
pledge or grant of a security interest; provided that no such pledge or grant of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or secured party for such Lender as a party
hereto; provided further, however, that the right of any such pledgee or grantee
(other than any Federal Reserve Bank) to further transfer all or any portion of
the rights pledged or granted to it, whether by means of foreclosure or
otherwise, shall be at all times subject to the terms of this Agreement.

 

(c)           Notwithstanding anything to the contrary contained herein, any
Lender (a “Designating Lender”) may grant to one or more special purpose funding
vehicles (each, an “SPV”), identified as such in writing from time to time by
the Designating Lender to the Administrative Agent and the Borrower, the option
to provide to the Credit Parties all or any part of any Revolving Loan that such
Designating Lender would otherwise be obligated to make to any Credit Party
pursuant to this Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPV to make any Revolving Loan, (ii) if an SPV elects not to
exercise such option or otherwise fails to provide all or any part of such
Revolving Loan, the Designating Lender shall be obligated to make such Revolving
Loan pursuant to the terms hereof, and (iii) the Designating Lender shall remain
liable for any indemnity or any other payment or performance obligation with
respect to its Revolving Credit Commitment hereunder or with respect to any
Revolving Loan made by an SPV pursuant to an option to make such Revolving Loan
granted pursuant hereto. The making of a Revolving Loan by an SPV hereunder
shall utilize the Revolving Credit Commitment of the Designating Lender to the
same extent, and as if, such Revolving Loan were made by such Designating
Lender.

 

2.29.        Section 13.16 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 13.16. Set-off.  In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default, each Lender and each subsequent holder of
any Obligation is hereby authorized by each Credit Party and each Guarantor at
any time or from time to time, without notice to any such Credit Party or
Guarantor or to any other Person, any such notice being hereby

 

19

--------------------------------------------------------------------------------

 

expressly waived, to set-off and to appropriate and to apply any and all
deposits (general or special, including, but not limited to, indebtedness
evidenced by certificates of deposit, whether matured or unmatured, but not
including trust accounts, and in whatever currency denominated) and any other
indebtedness at any time held or owing by that Lender or that subsequent holder
to or for the credit or the account of any Credit Party or Guarantor, whether or
not matured, against and on account of the Obligations of any Credit Party or
any such Guarantor to that Lender or that subsequent holder under the Loan
Documents, including, but not limited to, all claims of any nature or
description arising out of or connected with the Loan Documents, irrespective of
whether or not (a) that Lender or that subsequent holder shall have made any
demand hereunder or (b) the principal of or the interest on the Loans or Notes
and other amounts due hereunder shall have become due and payable pursuant to
Section 9 and although said obligations and liabilities, or any of them, may be
contingent or unmatured.

 

2.30.        Section 13.20 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 13.20. Excess Interest.  Notwithstanding any provision to the contrary
contained herein or in any other Loan Document, no such provision shall require
the payment or permit the collection of any amount of interest in excess of the
maximum amount of interest permitted by applicable law to be charged for the use
or detention, or the forbearance in the collection, of all or any portion of the
Loans or other obligations outstanding under this Agreement or any other Loan
Document (“Excess Interest”). If any Excess Interest is provided for, or is
adjudicated to be provided for, herein or in any other Loan Document, then in
such event (a) the provisions of this Section shall govern and control, (b)
neither any Credit Party nor any guarantor or endorser shall be obligated to pay
any Excess Interest, (c) any Excess Interest that the Administrative Agent or
any Lender may have received hereunder shall, at the option of the
Administrative Agent, be (i) applied as a credit against the then outstanding
principal amount of Obligations hereunder and accrued and unpaid interest
thereon (not to exceed the maximum amount permitted by applicable law), (ii)
refunded to the applicable Credit Party, or (iii) any combination of the
foregoing, (d) the interest rate payable hereunder or under any other Loan
Document shall be automatically subject to reduction to the maximum lawful
contract rate allowed under applicable usury laws (the “Maximum Rate”),

 

20

--------------------------------------------------------------------------------

 

and this Agreement and the other Loan Documents shall be deemed to have been,
and shall be, reformed and modified to reflect such reduction in the relevant
interest rate, and (e) neither any Credit Party nor any guarantor or endorser
shall have any action against the Administrative Agent or any Lender for any
damages whatsoever arising out of the payment or collection of any Excess
Interest. Notwithstanding the foregoing, if for any period of time interest on
any of any Credit Party’s Obligations is calculated at the Maximum Rate rather
than the applicable rate under this Agreement, and thereafter such applicable
rate becomes less than the Maximum Rate, the rate of interest payable on such
Credit Party’s Obligations shall remain at the Maximum Rate until the Lenders
have received the amount of interest which such Lenders would have received
during such period on such Credit Party’s Obligations had the rate of interest
not been limited to the Maximum Rate during such period.

 

2.31.        Section 13.23 of the Credit Agreement shall be amended and restated
to read in its entirety as follows:

 

Section 13.23. Submission to Jurisdiction; Waiver of Jury Trial.  Each Credit
Party and each Guarantor hereby submits to the nonexclusive jurisdiction of the
United States District Court for the Northern District of Illinois and of any
Illinois State court sitting in the City of Chicago for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby.  Each Credit Party
and each Guarantor irrevocably waives, to the fullest extent permitted by law,
any objection which it may now or hereafter have to the laying of the venue of
any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum. 
EACH CREDIT PARTY, EACH GUARANTOR, THE ADMINISTRATIVE AGENT AND EACH LENDER
HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED THEREBY.

 

2.32.        Exhibit B to the Credit Agreement shall be amended and restated to
read in its entirety as set forth in Exhibit 1 hereto.

 

2.33.        Exhibit C to the Credit Agreement shall be amended and restated to
read in its entirety as set forth in Exhibit 2 hereto.

 

21

--------------------------------------------------------------------------------

 

2.34.        A new Exhibit D-3 to the Credit Agreement shall be added
immediately following Exhibit D-2, to read in its entirety as set forth in
Exhibit 3 hereto.

 

2.35.        Schedule I to Exhibit E to the Credit Agreement shall be amended
and restated to read in its entirety as set forth in Exhibit 4 hereto.

 

SECTION 3.           CONDITIONS PRECEDENT.

 

The effectiveness of this Amendment is subject to the satisfaction of all of the
following conditions precedent:

 

3.1.          The Parent, the Borrower, FTD.COM, the Guarantors and the Lenders
shall have executed and delivered this Amendment.

 

3.2.          The Administrative Agent shall have received, for the ratable
account of the Lenders, a one-time amendment fee in the amount of 0.10% of the
Revolving Credit Commitments of the Lenders (whether used or unused).

 

3.3.          The Administrative Agent shall have received Revolving Notes for
each Lender duly executed by FTD.COM, together with certified copies of
resolutions of the board of directors of FTD.COM authorizing its execution,
delivery of this Amendment and its performance of its obligations hereunder and
under and the Credit Agreement as amended hereby and an incumbency certificate
showing specimen signatures of the persons authorized to execute this Amendment
and its Revolving Notes on behalf of FTD.COM and to make borrowing requests on
behalf of FTD.COM.

 

3.4.          The Administrative Agent shall have received for each Lender
copies of the articles or certificate of incorporation and bylaws of FTD.COM
certified by its Secretary or Assistant Secretary, together with a certificate
of good standing for FTD.COM dated no earlier than July 21, 2003 from the
Secretary of State of its state of incorporation.

 

3.6.          The Borrower shall have paid all reasonable accrued and unpaid
legal fees, expenses and disbursements of Chapman and Cutler, counsel to the
Administrative Agent, incurred in connection with the Credit Agreement or this
Amendment.

 

3.7.          The Borrower and all other parties thereto shall have executed and
delivered to the Administrative Agent amendments to the Pledge Agreement and the
Security Agreement and a second supplement to the Mortgage providing that
Obligations of FTD.COM shall be secured by the Collateral pledged pursuant
thereto to the same extent as the Obligations of the Borrower.

 

22

--------------------------------------------------------------------------------

 

SECTION 4.           REPRESENTATIONS.

 

In order to induce the Lenders to execute and deliver this Amendment, each
Credit Party (as defined in Section 2.9 hereof) hereby represents to the Lenders
that as of the date hereof the representations and warranties set forth in
Section 6 of the Credit Agreement as amended hereby are and shall be and remain
true and correct and that the Credit Parties are in compliance with the terms
and conditions of the Credit Agreement and no Default or Event of Default has
occurred and is continuing under the Credit Agreement or shall result after
giving effect to this Amendment (other than any such Default or Event of Default
as is specifically waived hereby).

 

SECTION 5.           MISCELLANEOUS.

 

5.1.             The Parent, the Borrower and the Guarantors have heretofore
executed and delivered to the Lenders the Collateral Documents.  The Credit
Parties hereby acknowledge and agrees that the Liens created and provided for by
the Collateral Documents continue to secure, among other things, the Obligations
arising under the Credit Agreement as amended hereby; and the Collateral
Documents and the rights and remedies of the Lenders thereunder, the obligations
of the Borrower, FTD.COM, the Parent and the Guarantors thereunder, and the
Liens created and provided for thereunder, remain in full force and effect and
shall not be affected, impaired or discharged hereby.  Nothing herein contained
shall in any manner affect or impair the priority of the liens and security
interests created and provided for by the Collateral Documents as to the
indebtedness which would be secured thereby prior to giving effect to this
Amendment.  The Borrower shall use commercially reasonable efforts to cause to
be delivered to the Administrative Agent, no later than 60 days after the date
hereof, a date-down endorsement to the lenders’ title policy for the property
insured by the Mortgage, relating to the second supplement to mortgage described
in Section 3.7 hereof.

 

5.2.             Except as specifically amended herein, the Credit Agreement
shall continue in full force and effect in accordance with its original terms. 
Reference to this specific Amendment need not be made in the Credit Agreement,
the Notes, or any other instrument or document executed in connection therewith,
or in any certificate, letter or communication issued or made pursuant to or
with respect to the Credit Agreement, any reference in any of such items to the
Credit Agreement being sufficient to refer to the Credit Agreement as amended
hereby.

 

5.3.             The Borrower agrees to pay on demand all reasonable third party
costs and expenses incurred by the Administrative Agent in connection with the
negotiation, preparation, execution and delivery of this Amendment, including
the reasonable fees and expenses of counsel for the Administrative Agent.

 

23

--------------------------------------------------------------------------------

 

5.4.             This Amendment may be executed in any number of counterparts,
and by the different parties on different counterpart signature pages, all of
which taken together shall constitute one and the same agreement.  Any of the
parties hereto may execute this Amendment by signing any such counterpart and
each of such counterparts shall for all purposes be deemed to be an original. 
This Amendment shall be governed by the internal laws of the State of Illinois.

 

[SIGNATURE PAGE TO FOLLOW]

 

24

--------------------------------------------------------------------------------

 

This First Amendment and Waiver to Amended and Restated Credit Agreement is
entered into as of this 31st day of July, 2003.

 

 

 

BORROWER

 

 

 

FLORISTS’ TRANSWORLD DELIVERY, INC.

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

 

 

 

CREDIT PARTY AND GUARANTOR

 

 

 

 

 

FTD.COM INC.

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

 

 

 

GUARANTORS

 

 

 

FTD, INC.

 

as Parent and as a Guarantor

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

 

 

 

VALUE NETWORK SERVICE, INC.

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

25

--------------------------------------------------------------------------------

 

 

FTD HOLDINGS, INCORPORATED

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

 

 

 

By

/s/ ROBERT L NORTON

 

 

Name

Robert L. Norton

 

 

Title

CEO and Chairman

 

 

 

 

 

 

FTD INTERNATIONAL CORPORATION

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

 

 

 

 

RENAISSANCE GREETING CARDS, INC.

 

 

 

 

 

By

/s/ CARRIE WOLFE

 

 

Name

Carrie Wolfe

 

 

Title

CFO

 

 

26

--------------------------------------------------------------------------------

 

 

LENDERS

 

 

 

HARRIS TRUST AND SAVINGS BANK, in its
individual capacity as a Lender and as
Administrative Agent

 

 

 

 

 

By

/s/ KIRBY M. LAW

 

 

Name

Kirby M. Law

 

 

Title

Vice President

 

 

 

 

 

 

U.S. BANK NATIONAL ASSOCIATION

 

 

 

 

 

By

/s/ R. MICHAEL NEWTON

 

 

Name

R. Michael Newton

 

 

Title

Vice President

 

 

 

 

 

 

KEYBANK NATIONAL ASSOCIATION

 

 

 

 

 

By

/s/ DAVID J. WECHTER, VP

 

 

Name

David J. Wechter

 

 

Title

Vice President

 

 

 

 

 

 

STANDARD FEDERAL BANK, N.A.

 

 

 

 

 

By

/s/ ANNETTE GORDON

 

 

Name

Annette Gordon

 

 

Title

First Vice President

 

 

27

--------------------------------------------------------------------------------

 

EXHIBIT 1 TO FIRST AMENDMENT AND WAIVER

 

EXHIBIT B

 

NOTICE OF BORROWING

 

Date:                      ,      

 

To:          Harris Trust and Savings Bank, as Administrative Agent for the
Lenders parties to the Amended and Restated Credit Agreement dated as of
September 27, 2002 (as extended, renewed, amended or restated from time to time,
the “Credit Agreement”), among Florists’ Transworld Delivery, Inc., FTD.COM
INC., the Guarantors, certain Lenders which are signatories thereto, and Harris
Trust and Savings Bank, as Administrative Agent

 

Ladies and Gentlemen:

 

The undersigned,                                    , refers to the Credit
Agreement, the terms defined therein being used herein as therein defined, and
hereby gives you notice irrevocably, pursuant to Section 1.5 of the Credit
Agreement, of the Borrowing specified below:

 

1.         The Business Day of the proposed Borrowing is                   ,
     .

 

2.         The aggregate amount of the proposed Borrowing is
$                       .

 

3.         The Borrowing is being advanced under the Revolving Credit.

 

4.         The Borrowing is to be comprised of $                   of [Base
Rate] [Eurodollar] Loans.

 

[5. The duration of the Interest Period for the Eurodollar Loans included in the
Borrowing shall be                      months.]

 

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the proposed Borrowing, before and
after giving effect thereto and to the application of the proceeds therefrom:

 

(a)         the representations and warranties contained in Section 6 of the
Credit Agreement are true and correct as though made on and as of such date
(except to the extent such representations and warranties relate to an earlier
date, in which case they are true and correct as of such date); and

 

--------------------------------------------------------------------------------

 

(b)         no Default or Event of Default has occurred and is continuing or
would result from such proposed Borrowing.

 

 

[FLORISTS’ TRANSWORLD DELIVERY, INC.]

 

 

 

[FTD.COM INC.]

 

 

 

By

 

 

 

 

Name

 

 

 

 

Title

 

 

 

2

--------------------------------------------------------------------------------

 

EXHIBIT 2 TO FIRST AMENDMENT AND WAIVER

 

EXHIBIT C

 

NOTICE OF CONTINUATION/CONVERSION

 

Date:                      , 20   

 

To:          Harris Trust and Savings Bank, as Administrative Agent for the
Lenders parties to the Amended and Restated Credit Agreement dated as of
September 27, 2002 (as extended, renewed, amended or restated from time to time,
the “Credit Agreement”), among Florists’ Transworld Delivery, Inc., FTD.COM
INC., the Guarantors, certain Lenders which are signatories thereto, and Harris
Trust and Savings Bank, as Administrative Agent

 

Ladies and Gentlemen:

 

The undersigned,                                            , refers to the
Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 1.5 of the
Credit Agreement, of the [conversion] [continuation] of the Loans specified
herein, that:

 

1.         The conversion/continuation Date is                ,      .

 

2.         The aggregate amount of the Revolving Loans to be [converted]
[continued] is $                       .

 

3.         The Loans are to be [converted into] [continued as] [Eurodollar]
[Base Rate] Loans.

 

4.         [If applicable:]  The duration of the Interest Period for the
Revolving Loans included in the [conversion] [continuation] shall be
                months.

 

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the proposed conversion/continuation date,
before and after giving effect thereto and to the application of the proceeds
therefrom:

 

(a)         the representations and warranties contained in Section 6 of the
Credit Agreement are true and correct as though made on and as of such date
(except to the extent such representations and warranties relate to an earlier
date, in which case they are true and correct as of such date); provided,
however, that this condition shall not apply to the conversion of an outstanding
Eurodollar Loan to a Base Rate Loan; and

 

--------------------------------------------------------------------------------

 

(b)         no Default or Event of Default has occurred and is continuing, or
would result from such proposed [conversion] [continuation].

 

 

[FLORISTS’ TRANSWORLD DELIVERY, INC.]

 

 

 

[FTD.COM INC.]

 

 

 

By

 

 

 

 

Name

 

 

 

 

Title

 

 

 

2

--------------------------------------------------------------------------------

 

EXHIBIT 3 TO FIRST AMENDMENT AND WAIVER

 

EXHIBIT D-3

 

REVOLVING NOTE

 

U.S. $                       

July 31, 2003

 

FOR VALUE RECEIVED, the undersigned, FTD.COM INC., a Delaware corporation
(“FTD.COM”), hereby promises to pay to the order of
                                  (the “Lender”) on the Termination Date of the
hereinafter defined Credit Agreement, at the principal office of Harris Trust
and Savings Bank, as Administrative Agent, in Chicago, Illinois, in immediately
available funds, the principal sum of                                       
Dollars ($               ) or, if less, the aggregate unpaid principal amount of
all Revolving Loans made by the Lender to FTD.COM pursuant to the Credit
Agreement, together with interest on the principal amount of each Revolving Loan
from time to time outstanding hereunder at the rates, and payable in the manner
and on the dates, specified in the Credit Agreement.

 

This Note is one of the Revolving Notes referred to in the Amended and Restated
Credit Agreement dated as of September 27, 2002, among the Borrower, FTD.COM,
the Guarantors, Harris Trust and Savings Bank, as Administrative Agent and the
Lenders party thereto (the “Credit Agreement”), and this Note and the holder
hereof are entitled to all the benefits and security provided for thereby or
referred to therein, to which Credit Agreement reference is hereby made for a
statement thereof.  All defined terms used in this Note, except terms otherwise
defined herein, shall have the same meaning as in the Credit Agreement.  This
Note shall be governed by and construed in accordance with the internal laws of
the State of Illinois.

 

Voluntary prepayments may be made hereon, certain prepayments are required to be
made hereon, and this Note may be declared due prior to the expressed maturity
hereof, all in the events, on the terms and in the manner as provided for in the
Credit Agreement.

 

FTD.COM hereby waives demand, presentment, protest or notice of any kind
hereunder.

 

 

FTD.COM INC.

 

 

 

 

 

By

 

 

 

 

Name

 

 

 

 

Title

 

 

 

--------------------------------------------------------------------------------

 

EXHIBIT 4 TO FIRST AMENDMENT AND WAIVER

 

SCHEDULE I

TO COMPLIANCE CERTIFICATE

 

FLORISTS’ TRANSWORLD DELIVERY, INC.

 

COMPLIANCE CALCULATIONS

FOR AMENDED AND RESTATED CREDIT AGREEMENT DATED AS OF SEPTEMBER 27, 2002

 

CALCULATIONS AS OF                       , 20     

 

A.

Total Funded Debt to EBITDA (Section 8.22)

 

 

 

 

 

 

 

 

 

1.

Total Funded Debt

$

 

 

 

 

 

 

 

 

 

2.

Net Income for past 4 quarters

$

 

 

 

 

 

 

 

 

 

3.

Interest Expense for past 4 quarters

$

 

 

 

 

 

 

 

 

 

4.

Income taxes for past 4 quarters

$

 

 

 

 

 

 

 

 

 

5.

Depreciation and Amortization Expense for past 4 quarters

$

 

 

 

 

 

 

 

 

 

6.

Payments of Settlement Amount for past 4 quarters

$

 

 

 

 

 

 

 

 

 

7.

Minority interest expense for past 4 quarters

$

 

 

 

 

 

 

 

 

 

8.

Plus/minus extraordinary non-cash losses/gains

$

 

 

 

 

 

 

 

 

 

9.

Other adjustments (see definition of EBITDA)

$

 

 

 

 

 

 

 

 

 

10.

Sum of Lines A2, A3, A4, A5, A6, A7, A8 (if a loss) and A9

$

 

 

 

 

 

 

 

 

 

11.

Reimbursements for payments of Settlement Amount for past 4 quarters

$

 

 

 

 

 

 

 

 

 

12.

Sum of Line A11 and Line A8 (if a gain)

$

 

 

 

 

 

 

 

 

 

13.

Difference of Line A10 less Line A12 (“EBITDA”)

$

 

 

 

 

 

 

 

 

 

14.

Ratio of Line A1 to Line A13

 

   : 1.0

 

 

 

 

 

 

 

 

15.

Line A14 ratio must not exceed

 

2.50 : 1.0

 

 

 

 

 

 

 

 

16.

The Parent is in compliance (circle yes or no)

 

yes/no

 

 

 

 

 

 

 

B.

Consolidated Net Worth (Section 8.23)

 

 

 

 

 

 

 

 

 

1.

Consolidated Net Worth

$

 

 

 

 

 

 

 

 

 

2.

Line B1 shall not be less than

$

 

 

 

 

 

 

 

 

 

3.

The Parent is in compliance (circle yes or no)

 

yes/no

 

 

--------------------------------------------------------------------------------

 

C.

Fixed Charge Coverage Ratio (Section 8.24)

 

 

 

 

 

 

 

 

 

 

 

1.

EBITDA (Line A13 above), less Capital Expenditures

$

 

 

 

 

 

 

 

 

 

 

 

2.

Scheduled cash principal payments for past 4 quarters

$

 

 

 

 

 

 

 

 

 

 

 

3.

Cash income taxes for past 4 quarters

$

 

 

 

 

 

 

 

 

 

 

4.

Cash Interest Expense for past 4 quarters

$

 

 

 

 

 

 

 

 

 

 

 

5

Restricted Payments (excluding management fees and related expenses and payments
of Settlement Amounts which would otherwise be Restricted Payments) for past 4
quarters

$

 

 

 

 

 

 

 

 

 

 

6.

Sum of Lines C2, C3, C4 and C5

$

 

 

 

 

 

 

 

 

 

 

 

7.

Ratio of Line C1 to Line C6

 

          : 1.0

 

 

 

 

 

 

 

 

 

 

8.

Total Funded Debt (from Line A1)

$

 

 

 

 

 

 

 

 

 

 

 

9.

Line C7 ratio must not be less than (1.75 to 1.0 if Line C8 is

 

          : 1.0

 

 

 

 

less than $25,000,000, otherwise, 2.0 to 1.0)

 

 

 

 

 

 

 

 

 

 

 

 

10.

The Parent is in compliance (circle yes or no)

 

yes/no

 

 

 

 

 

 

 

 

 

D.

Rentals (Section 8.26)

 

 

 

 

 

 

 

 

 

 

 

1.

Rentals during most recent fiscal year

$

 

 

 

 

 

 

 

 

 

 

2.

Line D1 shall not be more than

 

$10,000,000

 

 

 

 

 

 

3.

The Parent is in compliance (circle yes or no)

yes/no

 

 

2

--------------------------------------------------------------------------------