EXECUTION COPY

 

 

REVLON CONSUMER PRODUCTS CORPORATION,

as Borrower

 

$170,000,000

SENIOR SUBORDINATED TERM LOAN AGREEMENT

Dated as of January 30, 2008

 

MACANDREWS & FORBES HOLDINGS INC.,

as Lender

 
 

 

 

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TABLE OF CONTENTS

 

 

 

 

Page

SECTION 1. DEFINITIONS

1

 

1.1

Defined Terms

1

 

1.2

Other Definition Provisions

4

SECTION 2. AMOUNT AND TERMS OF THE LOAN

5

 

2.1

The Term Loan

5

 

2.2

Procedure for Borrowing

5

 

2.3

Repayment of the Loan; Evidence of Debt.

6

 

2.4

Use of Proceeds

6

SECTION 3. PROVISIONS RELATING TO THE LOAN

6

 

3.1

Optional Prepayments

6

 

3.2

Mandatory Prepayment

6

 

3.3

Interest Rate; Payment Dates

6

 

3.4

Method of Payments

7

SECTION 4. REPRESENTATIONS AND WARRANTIES

7

 

4.1

Corporate Existence

7

 

4.2

Corporate Power

7

 

4.3

No Legal Bar to Loan

8

SECTION 5. CONDITIONS PRECEDENT

8

 

5.1

Conditions to the Loan

8

SECTION 6. AFFIRMATIVE AND NEGATIVE COVENANTS

8

 

6.1

Certain Covenants of the 9½% Note Indenture

8

 

6.2

Change of Control

11

 

6.3

Successor Company

12

 

6.4

Further Assurances

12

SECTION 7. EVENTS OF DEFAULT

13

 

7.1

Events of Default

13

SECTION 8. SUBORDINATION

14

 

8.1

Agreement To Subordinate

14

 

8.2

Subordination Provisions Incorporated

15

 

8.3

Subsequent Amendments

15

SECTION 9. MISCELLANEOUS

16

 

9.1

Amendments and Waivers

16

 

9.2

Notices

16

 

9.3

No Waiver; Cumulative Remedies

16

 

9.4

Survival of Representations and Warranties

17

 

9.5

Payment of Expenses; General Indemnity

17

 

 

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9.6

Successors and Assigns

17

 

9.7

Counterparts

18

 

9.8

Severability

18

 

9.9

Integration

18

 

9.10

GOVERNING LAWS

19

 

9.11

Submission To Jurisdiction; Waivers

19

 

9.12

WAIVERS OF JURY TRIAL

19

 

 

ii

 

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SENIOR SUBORDINATED TERM LOAN AGREEMENT

SENIOR SUBORDINATED TERM LOAN AGREEMENT, dated as of January 30, 2008, between
REVLON CONSUMER PRODUCTS CORPORATION, a Delaware corporation (the “Borrower” or
“Company”), and MACANDREWS & FORBES HOLDINGS INC., a Delaware corporation (the
“Lender”).

W I T N E S S E T H:

WHEREAS, the Borrower has requested the Lender to extend credit to the Borrower
on a senior subordinated basis in order to enable the Borrower to repay at
maturity the outstanding principal amount due under the 8⅝% Notes (as defined
below) and to pay certain related fees and expenses;

WHEREAS, the Lender is willing to make such loan to the Borrower only on the
terms and subject to the conditions set forth herein;

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the following terms shall have the
following respective meanings (such definitions to be equally applicable to the
singular and plural forms thereof):

“Affiliate” of any Person means any Person that directly or indirectly controls,
or is under common control with, or is controlled by, such Person. As used in
this definition, “control” (including with its correlative meanings, “controlled
by” and “under common control with”) shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person (whether through ownership of securities or partnership or
other ownership interests, by contract or otherwise).

“Agreement” shall mean this Senior Subordinated Term Loan Agreement, as the same
may be amended, supplemented, replaced or otherwise modified from time to time.

“Bank Credit Agreements” means (a) the Credit Agreement, dated July 9, 2004,
among the Borrower, certain local borrowing subsidiaries, the Lenders named
therein and Citicorp USA, Inc. and UBS Securities LLC, as agents, as the same
may be amended, restated, supplemented or otherwise modified or replaced from
time to time and (b) the Term Loan Agreement, dated December 20, 2006, among the
Borrower, the Lenders named therein and Citicorp USA, Inc., as administrative
agent and collateral agent, as the same may be amended, restated, supplemented
or otherwise modified or replaced from time to time.

 

 

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“Bankruptcy Law” means Title 11 of the United States Code or any similar Federal
or state law for the relief of debtors.

“Borrower” is defined in the introductory paragraph of this Agreement.

“Borrowing Notice” is defined in Section 2.2(a) hereof.

“Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York are authorized or required by law to
close.

“Change of Control” has the meaning set forth in the 9½% Note Indenture.

“Company” is defined in the introductory paragraph of this Agreement.

“Contractual Obligation” means, with respect to any Person, any provision of any
material debt security or of any material preferred stock or other equity
interest issued by such Person or of any material indenture, mortgage,
agreement, guarantee, instrument or undertaking to which such Person is a party
or by which it or any of its material property is bound.

“Custodian” means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.

“Debt” has the meaning (i) set forth in the 9½% Note Indenture each time it
appears in Section 6 and 7 herein (and in the definitions of such terms as may
be used in such sections) and (ii) set forth in the 8⅝% Note Indenture each time
it appears in Section 8 herein (and in the definitions of such terms as may be
used in such section).

“Default” means any of the events specified in Section 7.1 hereof, whether or
not any requirement for the giving of notice, the lapse of time, or both, or any
other condition specifically set forth therein, has been satisfied.

“Designated Senior Debt” means (i) the Debt under the Bank Credit Agreements and
the 9½% Notes and (ii) any other Senior Debt which, at the time of determination
has an aggregate principal amount outstanding of, or commitments to lend up to,
at least $25 million and is specifically designated in the instrument evidencing
such Senior Debt as “Designated Senior Debt” by the Borrower.

“Dollars” and “$” mean dollars in lawful currency of the United States of
America.

“8⅝% Note Indenture” means the Indenture, dated as of February 1, 1998, between
the Borrower and the 8⅝% Note Indenture Trustee, relating to the 8⅝% Notes as
amended and supplemented through, and in effect on, the date hereof; provided
that upon the termination of such indenture or redemption of the 8⅝% Notes, the
terms of such indenture will continue to be applied for purposes of the
application and interpretation of the provisions of this Agreement.

 

 

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“8⅝% Note Indenture Trustee” means U.S. Bank Trust National Association
(formerly known as First Trust National Association).

“8⅝% Notes” means the 8⅝% Senior Subordinated Notes due February 1, 2008 of the
Borrower.

“Event of Default” means any of the events specified in Section 7.1 hereof,
provided that any requirement for the giving of notice, the lapse of time, or
both, or any other condition specifically set forth therein, has been satisfied.

“Funding Date” means February 1, 2008.

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government
(including, without limitation, any governmental department, commission, board,
bureau, agency or instrumentality, or other court or arbitrator, in each case
whether of the United States of America or foreign).

“Interest Payment Date” means March 31, June 30, September 30 and December 31 of
each year, commencing March 31, 2008.

“Lender” is defined in the introductory paragraph of this Agreement.

“Loan” is defined in Section 2.1 hereof.

“Maturity Date” means August 1, 2009.

“M&F Line of Credit” means the line of credit provided under the Senior
Unsecured Line of Credit Agreement, dated as of July 9, 2004, between the
Borrower and the Lender, as amended, increased, supplemented, replaced or
otherwise modified through the date hereof and as the same may be amended,
increased, supplemented, replaced or otherwise modified from time to time.

“9½% Note Indenture” means the Indenture, dated as of March 16, 2005, between
the Borrower and U.S. Bank Trust National Association, as trustee, relating to
the 9½% Notes as amended and supplemented through, and in effect on, the date
hereof; provided that upon the termination of such indenture or redemption of
the 9½% Notes, the terms of such indenture will continue to be applied for
purposes of the application and interpretation of the provisions of this
Agreement.

“9½% Notes” means the 9½% Senior Notes due 2011 of the Borrower.

“Person” means an individual, a partnership, a corporation, a business trust, a
joint stock company, a limited liability company, a trust, an unincorporated
association, a joint venture, a Governmental Authority or any other entity of
any nature whatsoever.

 

 

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“Requirement of Law” means, for any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation, or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its material property or to which such Person or any of its
material property is subject.

“Senior Debt” has the meaning set forth in the 8⅝% Note Indenture, provided,
that (A) clause (i) thereof shall be replaced with “all obligations under the
Bank Credit Agreements, the 9½% Notes and the M&F Line of Credit”, each such
terms having the meaning set forth herein, (B) the terms “Securities” and
“Indenture” each time they appear shall be replaced with the terms “Loan” and
“Agreement”, respectively, each such term having the meaning set forth herein,
(C) clause (6) at the end thereof shall be replaced with “the 8⅝% Notes and any
portion of the Loan”, each such terms having the meaning set forth herein, (D)
the term “Issue Date” used therein shall be replaced with “the date of this
Agreement” and (E) with respect to the term “Permitted Affiliate” as used
therein, the term “Credit Agreement” referenced in the definition of “Permitted
Affiliate” shall be replaced with the term “Bank Credit Agreements” as such term
is defined herein.

“Senior Subordinated Debt” means the Loan and any other indebtedness, Guarantee
(as defined in the 8⅝% Note Indenture) or obligation of the Borrower that
specifically provides that such indebtedness, Guarantee or obligation is to rank
pari passu in right of payment with the Loan and is not subordinated in right of
payment by its terms to any indebtedness, Guarantee or obligation of the
Borrower which is not Senior Debt.

“Significant Subsidiary” has the meaning set forth in the 9½% Note Indenture.

“Subordinated Obligation” means any Debt of the Borrower (whether outstanding on
the date hereof or hereafter issued) which is subordinate or junior in right of
payment to the Loan.

“Subsidiary” of any Person means a corporation or other entity of which shares
of capital stock or other ownership interests having ordinary voting power
(other than stock or other ownership interests having such power only by reason
of the happening of a contingency) to elect a majority of the directors of such
corporation, or other Persons performing similar functions for such entity, are
owned, directly or indirectly, by such Person; provided, that (a) unless
otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in
this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower and
(b) unless otherwise qualified, all references to a “wholly-owned Subsidiary” in
this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower of
which the Borrower directly or indirectly owns all of the capital stock or other
ownership interests (other than directors’ qualifying shares).

1.2 Other Definition Provisions.

 

 

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5

 

(a) All terms defined in this Agreement shall have such defined meanings when
used in any certificate or other document made or delivered pursuant hereto or
thereto unless otherwise defined therein.

(b) The words “hereof”, “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; and Section, subsection, Schedule
and Exhibit references contained in this Agreement are references to Sections,
subsections, Schedules and Exhibits in or to this Agreement, unless otherwise
specified.

(c) Terms defined in the singular shall have a comparable meaning when used in
the plural, and vice versa.

SECTION 2. AMOUNT AND TERMS OF THE LOAN

2.1 The Term Loan. On the Funding Date, subject to receipt of the Borrowing
Notice, the Lender agrees to make a term loan to the Borrower in an aggregate
principal amount of One Hundred and Seventy Million U.S. Dollars ($170,000,000)
(the “Loan”) in immediately available funds in Dollars not later than 9:00 a.m.,
New York City time (or at such later time as the Borrower may agree) on the
Funding Date, to be disbursed in accordance with Section 2.2(b) below, provided,
however, that this Agreement shall terminate at 5:00 p.m., New York City time on
the Funding Date if the Borrowing Notice has not been delivered prior to such
time.

2.2 Procedure for Borrowing.

(a) To exercise its right to borrow the Loan, the Borrower may deliver to the
Lender a written notice (the “Borrowing Notice”) which must (i) specify the bank
account and other pertinent wire transfer instructions to which each portion of
the Loan is to be deposited by the Lender in accordance with Section 2.2(b)
below and (ii) be received by the Lender prior to 1:00 p.m., New York City time
one (1) Business Day prior to the Funding Date (or at such later time as the
Lender may agree).

(b) On the Funding Date, the Lender shall disburse the Loan proceeds as follows:

(i) One Hundred and Sixty Seven Million Three Hundred and Seventy Eight Thousand
U.S. Dollars ($167,378,000) shall be disbursed directly to the 8⅝% Note
Indenture Trustee to repay at maturity the outstanding principal amount due
under the 8⅝% Notes;

(ii) Two Million Five Hundred and Fifty Thousand U.S. Dollars ($2,550,000) shall
be retained by the Lender as a nonrefundable fee in connection with the
financing provided herein by the Lender; and

(iii) The remaining Seventy Two Thousand U.S. Dollars ($72,000) shall be
disbursed as directed by the Borrower in the Borrowing Notice.

 

 

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2.3 Repayment of the Loan; Evidence of Debt.

(a) The Borrower hereby unconditionally promises to pay to the Lender the then
unpaid principal amount of the Loan on the Maturity Date. The Borrower hereby
further agrees to pay to the Lender interest on the unpaid principal amount of
the Loan from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum and in the manner set forth in Section 3.3
hereof.

(b) The Lender shall maintain an account evidencing indebtedness of the Borrower
to the Lender resulting from the Loan made hereunder, including (i) the original
principal of such Loan made hereunder, (ii) the unpaid principal amount of the
Loan and any accrued and unpaid interest outstanding in respect of the Loan and
(iii) the amount of any sum received by the Lender hereunder from the Borrower
in respect of the Loan and the manner in which it was applied.

(c) The entries made in the account of the Lender maintained pursuant to
Section 2.3(b) hereof shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of the Lender to maintain
such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loan in
accordance with the terms of this Agreement.

2.4 Use of Proceeds. The Borrower shall use the proceeds of the Loan hereunder,
in accordance with Section 2.2(b) hereof, to repay at maturity the outstanding
principal amount due under the 8⅝% Notes and to pay certain related fees and
expenses.

SECTION 3. PROVISIONS RELATING TO THE LOAN

3.1 Optional Prepayments. The Borrower may prepay the Loan, in whole or in part
(together with accrued and unpaid interest thereon), at any time without premium
or penalty, upon one Business Day’s notice to the Lender.

3.2 Mandatory Prepayment. The Borrower shall make mandatory prepayments of the
Loan to the extent required by Section 6.1(c)(xiv) or 6.2 hereof.

3.3 Interest Rate; Payment Dates.

(a) The Loan shall bear interest on the unpaid principal amount thereof at a
rate per annum equal to 11%.

(b) If all or a portion of the Loan, any interest payable thereon or any other
amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration, as a result of an event requiring a mandatory
prepayment or otherwise), then, for so long as such amount remains unpaid, such
overdue amount shall bear interest at a rate per annum equal to the rate
otherwise in effect plus 2%.

 

 

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(c) Interest accrued from time to time shall be payable in arrears in cash on
each Interest Payment Date. Any accrued and unpaid interest on the Loan shall be
payable in full in cash on the Maturity Date.

(d) Interest shall be calculated on the basis of a 365 (or 366, as the case may
be) day year for the actual days elapsed.

3.4 Method of Payments.

(a) All payments (including prepayments) to be made by the Borrower on account
of principal, interest, costs and expenses shall be made without set-off,
counterclaim, deduction or withholding and shall be made to the Lender at such
location or to such account as the Lender may specify to the Borrower, on or
prior to 1:00 p.m., New York City time, on the due date thereof, in Dollars and
in immediately available funds.

(b) If any payment hereunder becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business Day
and interest thereon shall be payable at the then applicable rate during such
extension.

SECTION 4. REPRESENTATIONS AND WARRANTIES

In order to induce the Lender to enter into this Agreement and to make the Loan
hereunder, the Borrower hereby represents and warrants to the Lender that:

4.1 Corporate Existence. The Borrower is duly incorporated, validly existing and
in good standing under the laws of the State of Delaware.

4.2 Corporate Power.

(a) The Borrower has the corporate power, authority and legal right to execute,
deliver and perform this Agreement and to borrow hereunder, and it has taken as
of the Funding Date all necessary corporate action to authorize its borrowings
on the terms and conditions of this Agreement and to authorize the execution,
delivery and performance of this Agreement.

(b) No consent of any other Person (including, without limitation, stockholders
or creditors of the Borrower or of any parent entity of the Borrower), and no
consent, license, permit, approval or authorization of, exemption by, or
registration, filing or declaration with, any Governmental Authority is required
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement by or against the Borrower, except for any
consents, licenses, permits, approvals or authorizations, exemptions,
registrations, filings or declarations that have already been obtained and
remain in full force and effect.

(c) This Agreement has been executed and delivered by a duly authorized officer
of the Borrower and constitutes the legal, valid and binding obligation

 

 

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8

 

of the Borrower, enforceable against it in accordance with its terms except as
enforceability may be limited by Bankruptcy Laws or other similar laws affecting
creditors’ rights generally and except as enforceability may be limited by
general principles of equity.

4.3 No Legal Bar to Loan. The execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby, will
not violate any Contractual Obligation or material Requirement of Law to which
the Borrower or any of its Subsidiaries is a party, or by which the Borrower or
any of its Subsidiaries or any of their respective material properties or assets
may be bound, and will not result in the creation or imposition of any lien on
any of their respective material properties or assets pursuant to the provisions
of any such Contractual Obligation.

SECTION 5. CONDITIONS PRECEDENT

5.1 Conditions to the Loan The obligation of the Lender to make the Loan shall
be subject to the satisfaction or waiver by the Lender of the following
conditions precedent:

(a) Agreement. The Lender shall have received this Agreement, executed and
delivered by a duly authorized officer of the Borrower.

(b) Representations and Warranties. Each of the representations and warranties
made by the Borrower in or pursuant to this Agreement shall be true and correct
in all material respects on and as of the Funding Date as if made on and as of
such date, both before and after giving effect to the Loan and the use of the
proceeds thereof.

(c) No Event of Default. No Event of Default hereunder or under the Bank Credit
Agreements or the 9½% Note Indenture (as such events of default are defined in
each such debt instrument) shall have occurred and be continuing on the Funding
Date, both before and after giving effect to the Loan.

The borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the Funding Date that the conditions contained in
this Section 5.1 have been satisfied.

SECTION 6. AFFIRMATIVE AND NEGATIVE COVENANTS

The Borrower hereby agrees that, so long as the Loan remains outstanding or any
amount is owing to the Lender hereunder:

6.1 Certain Covenants of the 9½% Note Indenture. (a) The Borrower will observe
and perform all of the covenants applicable to it and its Subsidiaries under the
following Sections of the 9½% Note Indenture, which covenants (together with the
definitions of such terms as may be used therein and as such covenants and such
definitions are in effect as of the date hereof) are hereby incorporated herein
by reference, mutatis mutandis, except as provided in Section 6.1(c):

 

 

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9

 

(i) Section 4.3 (Limitation on Debt);

(ii) Section 4.4 (Limitation on Liens);

(iii) Section 4.5 (Limitation on Restricted Payments);

(iv) Section 4.6 (Limitation on Restrictions on Distributions from
Subsidiaries);

(v) Section 4.7 (Limitation on Asset Sales); and

(vi) Section 4.8 (Limitation on Transactions with Affiliates).

(b) Any amendments, supplements, replacements or other modifications to Section
4.3, 4.4, 4.5, 4.6, 4.7 or 4.8 of the 9½% Note Indenture after the date hereof
shall not be incorporated herein by reference without the prior written consent
of the Lender. In the event that the 9½% Note Indenture shall expire, terminate
or be canceled, the provisions of Sections 4.3, 4.4, 4.5, 4.6, 4.7 and 4.8
thereof shall be deemed to be thereafter incorporated herein by reference,
mutatis mutandis, except as provided in Section 6.1(c), as such provisions were
in effect immediately prior to such expiration, termination or cancellation
(without giving effect to any amendments, supplements, replacements or
modifications after the date hereof, and prior to such expiration, termination
or cancellation, which the Lender has not agreed to incorporate) and as such
provisions may be amended, supplemented, replaced or otherwise modified from
time to time in accordance with the terms of this Agreement.

(c) For purposes of the incorporation by reference of the specified sections of
the 9½% Note Indenture (and the definitions used therein) as set forth in
Section 6.1(a) of this Agreement:

(i) the term “Credit Agreement” shall be replaced with “Bank Credit Agreements”
as such term is defined in Section 1.1 of this Agreement;

(ii) the terms “Default” and “Event of Default” shall have the meanings set
forth in Section 1.1 of this Agreement;

(iii) the terms “Holder,” “Noteholder” and “Trustee” shall be replaced with
“Lender” as such term is defined in Section 1.1 of this Agreement;

(iv) the term “Indenture” shall be replaced with “Agreement” as such term is
defined in Section 1.1 of this Agreement;

(v) the term “Issue Date” shall continue to mean March 16, 2005;

(vi) the term “Notes” (except when used in Section 4.3(b)(4) of the 9½% Note
Indenture or the definition of “Additional Notes” set forth

 

 

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10

 

therein) shall be replaced with “Loan” as such term is defined in Section 1.1 of
this Agreement;

(vii) the term “Officers’ Certificate” shall be amended by deleting the phrase
“in connection with the delivery of the Annual Certificate”;

(viii) the term “Pari Passu Debt” shall be replaced with “Senior Debt” as such
term is defined in Section 1.1 of this Agreement;

(ix) the term “Qualified Affiliate Debt” shall be amended by revising the last
proviso thereof to read: “provided, that all such Qualified Affiliated Debt
issued pursuant to this clause (ii) shall be Senior Subordinated Debt”

(x) the term “Rating Agencies” shall revised as “S&P and Moody’s” and the terms
“Senior Debt”, “Senior Subordinated Debt” and “Subordinated Obligations” shall
have the meanings set forth in Section 1.1 of this Agreement;

(xi) the term “Subsidiary Guarantor” (except when used in the last paragraph of
the definition of “Asset Sale”) shall be replaced with the phrase “Subsidiary of
the Company”;

(xii) Section 4.3 (Limitation on Debt) shall be revised as follows:

(A) clause (b)(5) of such Section 4.3 shall be revised to read: “(A) the Loan
and any Debt of the Company Issued to Refinance the Loan or any Debt Issued
pursuant to this clause (A); provided, however, that in the case of a
Refinancing, the principal amount of the Debt so Issued shall not exceed the
principal amount of the Debt so Refinanced plus any Refinancing Costs thereof
and (B) Debt of the Company Issued in a principal amount which, when taken
together with all other Debt Issued pursuant to this clause (B) and then
outstanding, does not exceed $110,000,000; provided, however, no Debt Issued
pursuant to this clause (5) shall be Senior Debt”;

(B) clause (b)(12) of such Section 4.3 shall be revised to read: “Debt (other
than Debt described in clauses (1) through (11) above and in Section 4.3(a)) in
an aggregate principal amount outstanding at any time not to exceed $200,000,000
plus any Refinancing Costs”;

(C) clause (b)(13) of such Section 4.3, shall be revised to read: “Guarantees by
any Subsidiary of the Company of any Debt of the Company permitted by Section
4.3(a) or clauses (1) through (12) of this Section 4.3(b)”; and

 

 

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11

 

(D) clause (c) of such Section 4.3 shall be revised to read: “The Company shall
not, directly or indirectly, incur any Debt that is subordinate or junior in
right of payment to any Senior Debt unless such Debt is Senior Subordinated Debt
or is expressly subordinated in right of payment to the Loan”;

(xiii) Section 4.4 (Limitation on Liens) shall be revised as follows:

(A) in the opening paragraph of such Section 4.4, the phrase “(other than Liens
securing Senior Debt and Liens securing Debt of a Subsidiary)” shall be inserted
after the phrase “securing any obligation”; and

(B) clause (e)(A)(ii) of such Section 4.4 shall be deleted;

(xiv) Section 4.7 (Limitation on Asset Sales) shall be revised as follows:

(A) clauses (e) through (i) of such Section 4.7 shall not apply under this
Agreement (but shall continue to apply to the 9½% Notes if any 9½% Notes are
then outstanding); and

(B) to the extent that any portion of the amount of Excess Proceeds (as defined
in the 9½% Note Indenture) remains after compliance with Sections 4.7(e) through
(i) thereof (if applicable) and provided that all holders of any
then-outstanding 9½% Notes have been given the opportunity to tender their 9½%
Notes for repurchase in accordance with the 9½% Note Indenture and all such
tendered 9½% Notes have been so repurchased, then on the following Business Day
the Borrower shall, to the extent permitted by the Bank Credit Agreements,
prepay the Loan in amount equal to the amount of Excess Proceeds so remaining;
and

(xv) references to the sections incorporated herein by reference shall be deemed
to be made to such sections as modified herein.

6.2 Change of Control. Upon the occurrence of a Change of Control, the Borrower
shall provide prompt written notice thereof to the Lender. If any 9½% Notes are
then outstanding, the Borrower shall comply with the provisions of Section 4.9
of the 9½% Note Indenture in accordance with its terms and then, on the first
Business Day after all 9½% Notes that have been tendered pursuant to such
Section 4.9 have been repurchased by the Borrower in accordance therewith, the
Borrower shall, to the extent permitted by the Bank Credit Agreements, prepay
the Loan in full, together with all accrued interest thereon. If no 9½% Notes
are outstanding at the time of such Change of Control, then on the following
Business Day, the Borrower shall, to the extent permitted

 

 

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by the Bank Credit Agreements, prepay the Loan in full, together with all
accrued interest thereon.

6.3 Successor Company.

(a) The Borrower may not consolidate or merge with or into, or convey, transfer
or lease all or substantially all its assets to, any Person, unless:

(i) the resulting, surviving or transferee Person (if not the Borrower) shall be
a Person organized and existing under the laws of the United States of America,
any State thereof or the District of Columbia and such Person expressly assumes,
by a written assumption agreement executed and delivered to the Lender, in form
satisfactory to the Lender, all the obligations of the Borrower under this
Agreement;

(ii) immediately after giving effect to such transaction (and treating any Debt
which becomes an obligation of the resulting, surviving or transferee Person or
any of its Subsidiaries as a result of such transaction as having been issued by
such Person or such Subsidiary at the time of such transaction), no Default has
occurred and is continuing;

(iii) immediately after giving effect to such transaction, the resulting,
surviving or transferee Person would be able to incur at least $1.00 of Debt
pursuant to clause (i) of Section 6.1(a) hereof; and

(iv) the Borrower shall have delivered to the Lender an officers’ certificate
and an opinion of counsel to the Borrower, each in form and substance
satisfactory to the Lender, stating that such consolidation, merger or transfer
and such assumption agreement (if any) comply with this Agreement;

provided, that nothing in this Section 6.3(a) shall prohibit a Wholly Owned
Recourse Subsidiary (as defined in the 9½% Note Indenture) from consolidating
with or merging with or into, or conveying, transferring or leasing all or
substantially all its assets to, the Borrower. Notwithstanding the foregoing,
without complying with Section 6.3(a)(iii), the Borrower may merge with or into
an Affiliate of the Borrower, provided, that such Affiliate has no material
assets or liabilities and after such merger there is no material change in the
beneficial ownership of the Borrower.

(b) The resulting, surviving or transferee Person shall be the successor
Borrower and shall succeed to, and be substituted for, and may exercise every
right and power of, the predecessor Borrower under this Agreement and
thereafter, except in the case of a lease, the predecessor Borrower shall be
discharged from all obligations and covenants under this Agreement.

6.4 Further Assurances. Upon the request of the Lender, the Borrower will
execute and deliver such further instruments, provide such further information
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Agreement.

 

 

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SECTION 7. EVENTS OF DEFAULT

7.1 Events of Default. An “Event of Default” occurs if:

(a) the Borrower defaults in any payment of interest on the Loan when the same
becomes due and payable and such default continues for a period of 30 days;

(b) the Borrower defaults in the payment of the principal of the Loan when the
same becomes due and payable;

(c) the Borrower fails to comply with Section 6.3 hereof;

(d) the Borrower fails to comply with the covenants incorporated by reference in
clauses (i), (ii), (iii), (iv), (v) and (vi) of Section 6.1(a) hereof and such
failure continues for 30 days after receipt of written notice thereof from the
Lender;

(e) the Borrower fails to comply with any of the other material covenants or
agreements applicable to it in this Agreement (other than those referred to in
(a), (b), (c) or (d) above) and such failure continues for 60 days after receipt
of written notice thereof from the Lender;

(f) Any representation or warranty made or deemed made by the Borrower in this
Agreement shall prove to have been incorrect, false or misleading in any
material respect on or as of the date when made or deemed to have been made;

(g) Debt of the Borrower or any Significant Subsidiary is not paid within any
applicable grace period after final maturity or is accelerated by the holders
thereof because of a default, the total principal amount of the portion of such
Debt that is unpaid or accelerated exceeds $25 million or its foreign currency
equivalent and such default continues for 10 days after receipt of written
notice thereof from the Lender;

(h) the Borrower or any Significant Subsidiary pursuant to or within the meaning
of any Bankruptcy Law:

(i) commences a voluntary case;

(ii) consents to the entry of an order for relief against it in an involuntary
case;

(iii) consents to the appointment of a Custodian of it or for any substantial
part of its property; or

(iv) makes a general assignment for the benefit of its creditors; or takes any
comparable action under any foreign Bankruptcy Laws;

 

 

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(i) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:

(i) is for relief against the Borrower or any Significant Subsidiary in an
involuntary case;

(ii) appoints a Custodian of the Borrower or any Significant Subsidiary for any
substantial part of the Borrower’s property; or

(iii) orders the winding up or liquidation of the Borrower or any Significant
Subsidiary;

or any similar relief is granted under any foreign Bankruptcy Laws and the order
or decree remains unstayed and in effect for 60 days; or

(j) any judgment or decree for the payment of money in excess of $25 million or
its foreign currency equivalent is entered against the Borrower or any
Significant Subsidiary and is not discharged and either (A) an enforcement
proceeding has been commenced by any creditor upon such judgment or decree or
(B) there is a period of 60 days following the entry of such judgment or decree
during which such judgment or decree is not discharged, waived or the execution
thereof stayed and, in the case of (B), such Default continues for 10 days after
receipt of written notice thereof from the Lender.

The foregoing will constitute Events of Default whatever the reason for any such
Event of Default and whether it is voluntary or involuntary or is effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body.

If an Event of Default shall have occurred and is continuing, (A) if such event
is an Event of Default specified in paragraph (h) or (i) of this Section 7.1
with respect to the Borrower, the Loan hereunder (with accrued interest thereon)
and all other amounts owing under this Agreement shall immediately become due
and payable without further action or notice on the part of the Lender, and (B)
if such event is any other Event of Default, the Lender may by notice to the
Borrower declare the Loan hereunder (with accrued interest thereon) and all
other amounts owing by the Borrower under this Agreement to be due and payable
forthwith, whereupon the same shall immediately become due and payable. Except
as expressly provided above in this Section 7.1, presentment, demand, protest
and all other notices of any kind are hereby expressly waived.

SECTION 8. SUBORDINATION

8.1 Agreement To Subordinate. The Borrower and the Lender agree that the
indebtedness evidenced by the Loan is subordinated in right of payment, to the
extent and in the manner provided in this Section 8, to the prior payment of all
Senior Debt and that the subordination is for the benefit of and enforceable by
the holders of

 

 

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Senior Debt. The Loan shall in all respects rank pari passu with all other
Senior Subordinated Debt of the Borrower and only indebtedness of the Borrower
which is Senior Debt shall rank senior to the Loan in accordance with the
provisions set forth herein.

8.2 Subordination Provisions Incorporated. Article X of the 8⅝% Note Indenture
(together with the definitions of such terms as may be used therein and as such
Article and such definitions are in effect as of the date hereof) is hereby
incorporated herein by reference, mutatis mutandis, except as provided below:

(a) the terms “Securityholders”, “Security”, “Indenture” and “Trustee” each time
they appear in such Article X shall be replaced with “Lender”, “Loan”,
“Agreement” and “Lender” respectively, as such terms are defined in Section 1.1
of this Agreement;

(b) the terms “Senior Debt”, “Designated Senior Debt”, “Senior Subordinated
Debt”, “Default” and “Event of Default” each time they appear in such Article X
shall have the meaning set forth in Section 1.1 of this Agreement;

(c) in Section 10.03, (i) the phrase “or make any deposit pursuant to Section
8.01” shall be deleted and (ii) the term “Bank Debt” shall be replaced with the
term “Bank Credit Agreements” as such term is defined in Section 1.1 of this
Agreement;

(d) Section 10.09 shall be replaced in its entirety by: “Rights of the Lender.
The Borrower shall give prompt written notice to the Lender of any fact known to
the Borrower which would prohibit the making of any payment to the Lender in
respect of the Loan.”;

(e) Sections 10.01, 10.12, 10.14, 10.15 and the last sentence of Section 10.13
shall be deleted in their entirety; and

(f) references to “Article X” shall be replaced with references to Section 8 of
this Agreement.

8.3 Subsequent Amendments. Any amendments, supplements, replacements or other
modifications to Article X of the 8⅝% Note Indenture after the date hereof shall
not be incorporated herein by reference without the prior written consent of the
Lender. In the event that the 8⅝% Note Indenture shall expire, terminate or be
canceled, the provisions of Article X thereof shall be deemed to be thereafter
incorporated herein by reference, mutatis mutandis, except as provided above, as
such provisions were in effect immediately prior to such expiration, termination
or cancellation (without giving effect to any amendments, supplements,
replacements or modifications after the date hereof, and prior to such
expiration, termination or cancellation, which the Lender has not agreed to
incorporate) and as such provisions may be amended, supplemented, replaced or
otherwise modified from time to time in accordance with the terms of this
Agreement.

 

 

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SECTION 9. MISCELLANEOUS

9.1 Amendments and Waivers. This Agreement shall not be amended, supplemented,
replaced or otherwise modified, except by written instrument which has been duly
executed and delivered by each party hereto. In the case of any waiver of the
terms hereof, the parties to this Agreement shall be restored to their former
positions and rights hereunder, and any Default or any Event of Default waived
shall, to the extent provided in such waiver, be deemed to be cured and not
continuing; but, no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.

9.2 Notices. All notices, consents, requests and demands to or upon the
respective parties hereto to be effective shall be in writing and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or
made when delivered by hand, or three Business Days after being deposited in the
mail, certified mail, return receipt requested, postage prepaid, or, in the case
of telecopy or electronic mail notice, when sent and receipt has been confirmed,
addressed as follows (or to such other address as may be hereafter notified by
any of the respective parties hereto):

 

Borrower:

 

Revlon Consumer Products Corporation
237 Park Avenue
New York, New York 10017
Attention: Alan Ennis
Telecopy: (212) 527-5250
E-mail: alan.ennis@revlon.com

With a copy to:

 

Revlon Consumer Products Corporation
237 Park Avenue
New York, New York 10017
Attention: Robert Kretzman
Telecopy: (212) 527-5693
E-mail: robert.kretzman@revlon.com

Lender:

 

MacAndrews & Forbes Holdings Inc.
35 East 62nd Street
New York, New York 10065
Attention: Paul Savas
Telecopy: (212) 572-8618
Email: psavas@mafgrp.com

provided, that any notice, request or demand to or upon the Lender pursuant to
Sections 2 and 3 shall not be effective until received.

9.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Lender, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial
exercise of any

 

 

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right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

9.4 Survival of Representations and Warranties. All representations and
warranties made hereunder and in any document, certificate or statement
delivered pursuant hereto or in connection herewith shall survive the execution
and delivery of this Agreement and the making of the Loan hereunder.

9.5 Payment of Expenses; General Indemnity. The Borrower agrees (a) to pay or
reimburse the Lender for all of its reasonable out-of-pocket attorneys’ fees and
expenses incurred in connection with the preparation, execution and delivery of,
and any amendment, supplement, modification or replacement to, this Agreement
and any other documents prepared in connection herewith, and the consummation of
the transactions contemplated hereby and thereby, (b) to pay or reimburse the
Lender for all its reasonable out-of-pocket costs and expenses (including,
without limitation, reasonable attorneys’ fees and expenses) incurred in
connection with the enforcement or preservation of any rights under this
Agreement and any such other documents, (c) to pay, indemnify, and to hold the
Lender harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay caused by the Borrower
in paying, stamp, excise and other similar taxes, if any, if legal, which may be
payable or determined to be payable in connection with the execution and
delivery of, or consummation of any of the transactions contemplated by, or any
amendment, supplement, modification or replacement of, or any waiver or consent
under or in respect of, this Agreement and any such other documents, and (d) to
pay, indemnify, and hold harmless the Lender from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever (including,
without limitation, reasonable attorneys’ fees and expenses) with respect to the
execution, delivery, consummation, enforcement, performance and administration
of this Agreement and any such other documents (all of the foregoing,
collectively, the “indemnified liabilities”); provided, that the Borrower shall
have no obligation hereunder with respect to indemnified liabilities arising
from (i) the gross negligence or willful misconduct of the Lender, or
(ii) amounts of the types referred to in clauses (a) through (c) above except as
provided therein. The agreements in this Section 9.5 shall survive the
termination of this Agreement and the repayment of the Loan and all other
amounts payable hereunder.

9.6 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the Borrower, the Lender and their respective successors and
permitted assigns and, except as set forth below, neither the Borrower nor the
Lender may assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the other party. This Agreement,
or the Lender’s obligations hereunder, may be assigned, delegated or
transferred, in whole or in part, by the Lender to any Affiliate of the Lender
over which the Lender or any of its Affiliates exercises investment authority,
including, without limitation, with respect to voting and dispositive

 

 

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rights provided that any such assignee assumes the obligations of the Lender
hereunder and agrees in writing to be bound by the terms of this Agreement in
the same manner as the Lender. Notwithstanding the foregoing, no such assignment
shall relieve the Lender of its obligations hereunder if such assignee fails to
perform such obligations. Without complying with the provisions of this Section
9.6, the Lender may satisfy its obligations under Sections 2.1 or 2.2 hereof by
causing an Affiliate of the Lender to satisfy its obligations under such
Sections. The Lender may sell participations in its rights and obligations under
this Agreement; provided, however, that (i) the Borrower shall continue to deal
solely and directly with the Lender in connection with the Lender’s rights and
obligations hereunder, (ii) the Lender shall retain the sole right (x) to
receive all payments hereunder, (y) to exercise or refrain from exercising any
powers or rights the Lender may have in respect of this Agreement (including the
right to declare a Default or Event of Default and to enforce the obligations of
the Borrower hereunder) and (z) to approve any amendments, waivers or other
modifications of any payment or other provision of this Agreement, and (iii) the
participants’ consent shall not be required for any of the foregoing. The Lender
may also assign its rights and obligations under this Agreement; provided,
however, that (a) all decisions to exercise or refrain from exercising any
powers or rights the Lender may have in respect of this Agreement (including the
right to declare a Default or Event of Default and to enforce the obligations of
the Borrower hereunder) and to approve any amendments, waivers or other
modifications of any payment or other provision of this Agreement shall be made
solely by the holders of a majority of the outstanding principal amount of the
Loan at the time such decision is made and (b) the administration of the Loan
and this Agreement, including receipt of all payments and notices as agent for
further distribution to all holders of any outstanding principal amount of the
Loan, shall be handled by MacAndrews & Forbes Holdings Inc. on behalf of all
such holders. The Lender agrees that the Borrower shall not have any obligation
for payment of any amounts under this Agreement in excess of what the Borrower
would have been obligated to pay in the absence of any such assignment or
participation.

9.7 Counterparts. This Agreement may be executed by one or more of the parties
to this Agreement on any number of separate counterparts (including by facsimile
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.

9.8 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

9.9 Integration. This Agreement represents the agreement of the Borrower and the
Lender with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Lender for the benefit of the
Borrower relative to the subject matter hereof not expressly set forth or
referred to herein.

 

 

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19

 

9.10 GOVERNING LAWS. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

9.11 Submission To Jurisdiction; Waivers. The Borrower hereby irrevocably and
unconditionally:

(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement, or for recognition and enforcement of any judgment
in respect thereof, to the non-exclusive general jurisdiction of the Courts of
the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;

(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;

(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 9.2 or at such other address of which the Lender
shall have been notified pursuant thereto;

(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

(e) waives, to the maximum extent not prohibited by law, any right it may have
to claim or recover in any legal action or proceeding referred to in this
subsection any special, exemplary, punitive or consequential damages.

9.12 WAIVERS OF JURY TRIAL. THE BORROWER AND THE LENDER HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.

 

 

 

REVLON CONSUMER PRODUCTS CORPORATION

 

 

 

 

 

By:

/s/ Robert K. Kretzman

 

 

 

Name: Robert K. Kretzman

 

 

 

Title: Executive Vice President, Human Resources,
          Chief Legal Officer and General Counsel

 

 

 

MACANDREWS & FORBES HOLDINGS INC.

 

 

 

 

 

By:

/s/ Barry F. Schwartz

 

 

 

Name: Barry F. Schwartz

 

 

 

Title: Executive Vice Chairman

 

 

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