Exhibit 10.1


 


FTD, INC.


 


FIRST
AMENDMENT


TO CREDIT
AGREEMENT


 


This FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is dated as of November 15, 2004 and entered
into by and among FTD, Inc., a Delaware corporation (“Company”),
the Guarantors (as defined in Section 6 hereof), the financial institutions
listed on the signature pages hereof (“Lenders”) and
Credit Suisse First Boston, acting through its Cayman Islands Branch, as
administrative agent for Lenders (“Administrative Agent”),
and is made with reference to that certain Credit Agreement, dated as of
February 24, 2004 (the “Credit Agreement”),
by and among Company, Lenders, UBS Securities LLC, as syndication agent, Wells
Fargo Bank, N.A., as documentation agent and Administrative Agent.  Capitalized terms used herein without
definition shall have the same meanings herein as set forth in the Credit
Agreement.


 


RECITALS


 


WHEREAS,
Company and Lenders desire to amend the Credit Agreement to
(i) reduce the interest rate margins applicable to the Term Loans, (ii)
provide for a premium to be paid to Lenders if the interest rate margins
applicable to the Term Loans are further reduced under certain circumstances
and (iii) make certain other amendments as set forth below:


 


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


 


Section
1.  AMENDMENTS TO THE CREDIT AGREEMENT


 


1.1          Amendments to Section 1:  Definitions


 


A.            Subsection 1.1 of the Credit
Agreement is hereby amended by adding thereto the following definitions:


 


“‘First Amendment’ means that certain First Amendment to
Credit Agreement, dated as of November 15, 2004, by and among Company, the
Lenders signatory thereto and Administrative Agent.”


 


“‘First Amendment Effective Date’ means November 15, 2004.”


 


“‘Repricing Prepayment’ has the meaning set forth in
subsection 2.2I.”


 


1.2          Amendments to Section 2: Amounts and Terms of
Commitments and Loans


 


A.            Subsection 2.2A(i) of the Credit
Agreement is hereby amended by deleting such subsection in its entirety and
substituting the following therefor:


 





















 


“(i)          Subject to the provisions of
subsections 2.2E, 2.2G and 2.7, the Term Loans shall bear interest through
maturity as follows:


 


(a)           if a Base Rate Loan, then at the sum
of the Base Rate plus 1.25% per annum; or


 


(b)           if a Eurodollar Rate Loan, then at
the sum of the Eurodollar Rate plus 2.25% per annum


 


; provided that
for the period from the first Business Day after delivery of the Pricing
Certificate for the Fiscal Year ended June 30, 2004, to the First Amendment
Effective Date, the applicable margin for Term Loans shall be the applicable
margin as in effect immediately prior to the First Amendment Effective Date
and, commencing on the First Amendment Effective Date, the applicable margin
for Term Loans shall be determined as provided for above.”


 


B.            Subsection 2.2A(iii) of the Credit
Agreement is hereby amended by (i) deleting the phrase “and Term Loans”
contained therein and (ii) deleting the phrase “(subject to the provisions of
the foregoing clauses (i) and (ii))” and replacing such phrase with the phrase
“(subject to the provisions of the foregoing clause (ii)).”


 


C.            Subsection 2.2 of the Credit Agreement
is hereby amended by adding the following subsection 2.2I at the end thereof:


 


“I.            Term Loan Repricing
Protection.  In the event
that, prior to the first anniversary of the First Amendment Effective Date, any
Lender with Term Loan Exposure receives a Repricing Prepayment (as defined
below), then, at the time thereof, Company shall pay to such Lender a
prepayment premium equal to 1.00% of the amount of such Repricing
Prepayment.  As used herein, with respect
to any Lender with Term Loan Exposure, a “Repricing Prepayment”
is the amount of principal of the Term Loans of such Lender that is either (a)
prepaid by Company pursuant to subsection 2.4B substantially concurrently with
the incurrence by Holdings or any of its Subsidiaries of new term loans under
this Agreement (or pursuant to any amendment, amendment and restatement or
other modification of this Agreement) that have interest rate margins lower
than the interest rate margins, as determined in accordance with subsection
2.2A(i), then in effect for the Term Loans so prepaid or (b) received by such
Lender as a result of the mandatory assignment of such Term Loans in the
circumstances described in subsection 2.9 following the failure of such Lender
to consent to an amendment of this Agreement (other than the First Amendment)
that would have the effect of reducing any of the interest rate margins
provided for in subsection 2.2A(i) applicable to such Term Loans; provided
however that such Repricing Prepayment shall not include any prepayment made in
connection with (i) the repayment of all of the principal and interest due on
Loans under the Credit Agreement, (ii) the termination of all of the Revolving
Loan Commitments


 


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under the Credit Agreement and (iii) the payment of
all other obligations due and owing under the Loan Documents.”


 


Section
2.              SUBSTITUTION OF SCHEDULE


 


A.            Schedule to Credit Agreement.  Schedule 5.6 attached to the Credit Agreement
is hereby deleted in its entirety and replaced with Schedule 5.6 attached
hereto.


 


Section
3.              CONDITIONS TO
EFFECTIVENESS


 


This Amendment
shall become effective only upon the satisfaction of all of the following
conditions precedent (the date of satisfaction of such conditions being
referred to herein as the “First Amendment Effective
Date”):


 


A.            On or before the First Amendment
Effective Date, Company shall deliver to Lenders (or to Administrative Agent
for Lenders) the following, each, unless otherwise noted, dated the First
Amendment Effective Date:


 


1.           Signature and incumbency certificates
of its officers executing this Amendment ; and


 


2.           Copies of this Amendment executed by
Company and Guarantors.


 


B.            On or before the First Amendment
Effective Date, all corporate and other proceedings taken or to be taken in
connection with the transactions contemplated hereby and all documents
incidental thereto not previously found acceptable by Administrative Agent,
acting on behalf of Lenders, and its counsel shall be satisfactory in form and
substance to Agent and such counsel, and Agent and such counsel shall have
received all such counterpart originals or certified copies of such documents
as Administrative Agent may reasonably request.


 


C.            Company shall have paid to Administrative Agent the fees
and expenses separately agreed to by Company and Administrative Agent in
connection with this Amendment.


 


D.            Each Lender with
outstanding Term Loans and Administrative Agent shall have executed and
delivered copies of this Amendment to Administrative Agent.


 


Section
4.              COMPANY’S REPRESENTATIONS
AND WARRANTIES


 


In order to induce
Lenders to enter into this Amendment and to amend the Credit Agreement in the
manner provided herein, Company represents and warrants to each Lender that the
following statements are true, correct and complete:


 


A.            Corporate Power and Authority.  Company and each Guarantor has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under, this Amendment
and the Credit Agreement as amended by this Amendment (the “Amended Agreement”), as applicable.


 


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B.            Authorization of Agreements.  The execution and delivery of this Amendment
and the performance of the Amended Agreement have been duly authorized by all
necessary corporate action on the part of Company and each Guarantor, as
applicable.


 


C.            No Conflict.  The execution, delivery and performance by
Company and each Guarantor of this Amendment and the performance by Company of
the Amended Agreement do not and will not (i) violate any provision of any
law or any governmental rule or regulation applicable to Company or any
Guarantor, the Organizational Documents of Company or any Guarantor or any
order, judgment or decree of any court or other agency of government binding on
Company or any Guarantor, (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Company or any Guarantor, (iii) result in or
require the creation or imposition of any Lien upon any of the properties or
assets of Company or any Guarantor (other than Liens created under any of the
Loan Documents in favor of Administrative Agent on behalf of Lenders), or
(iv) require any approval of stockholders or any approval or consent of
any Person under any Contractual Obligation of Company or any Guarantor.


 


D.            Governmental Consents.  The execution, delivery and performance by
Company and each Guarantor of this Amendment and the performance by Company of
the Amended Agreement do not and will not require any registration with,
consent or approval of, or notice to, or other action to, with or by, any
federal, state or other governmental authority or regulatory body.


 


E.             Binding Obligation.  This Amendment has been duly executed and
delivered by Company and each Guarantor and this Amendment and the Amended
Agreement are the legally valid and binding obligations of Company and each
Guarantor, as applicable, enforceable against Company and each Guarantor, as
applicable, in accordance with their respective terms, except as may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors’ rights generally or by equitable principles relating
to enforceability.


 


F.             Incorporation of Representations
and Warranties From Credit Agreement.  The representations and warranties contained
in Section 5 of the Credit Agreement are and will be true, correct and
complete in all material respects on and as of the First Amendment Effective
Date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case they were true, correct and complete in all material
respects on and as of such earlier date.


 


G.            Absence of Default.  No event has occurred and is continuing or
will result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Potential Event of
Default.


 


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Section
5.  MISCELLANEOUS


 


A.            Reference to and Effect on the
Credit Agreement and the Other Loan Documents.


 


(i)            On and after the First Amendment
Effective Date, each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or words of like import referring to the Credit
Agreement, and each reference in the other Loan Documents to the “Credit
Agreement”, “thereunder”, “thereof” or words of like import referring to the
Credit Agreement shall mean and be a reference to the Amended Agreement.


 


(ii)           Except as specifically amended by
this Amendment, the Credit Agreement and the other Loan Documents shall remain
in full force and effect and are hereby ratified and confirmed.


 


(iii)          The execution, delivery and
performance of this Amendment shall not, except as expressly provided herein,
constitute a waiver of any provision of, or operate as a waiver of any right,
power or remedy of Agent or any Lender under, the Credit Agreement or any of
the other Loan Documents.


 


B.            Fees and Expenses.  Company acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Administrative Agent and its counsel with respect to this Amendment and the
documents and transactions contemplated hereby shall be for the account of
Company.


 


C.            Headings.  Section and subsection headings in this
Amendment are included herein for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose or be given any
substantive effect.


 


D.            Applicable Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.


 


E.             Counterparts.  This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered (including a facsimile thereof) shall
be deemed an original, but all such counterparts together shall constitute but
one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all
signature pages are physically attached to the same document.


 


Section
6.   ACKNOWLEDGEMENT AND CONSENT BY
GUARANTORS


 


Each guarantor (or
pledgor) listed on the signatures pages hereof (each, a “Guarantor”) hereby acknowledges and agrees
that any of the Guaranties and Collateral Document (each, a “Credit Support Document”) to which it is a
party or otherwise bound shall continue in full force and effect and that all
of its obligations thereunder shall be valid and enforceable and shall not be
impaired or limited by the execution or effectiveness of this


 


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Amendment.  Each Guarantor represents and warrants that
all representations and warranties contained in the Amended Agreement and the
Credit Support Documents to which it is a party or otherwise bound are true,
correct and complete in all material respects on and as of the First Amendment
Effective Date to the same extent as though made on and as of that date, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case they were true, correct and complete in all
material respects on and as of such earlier date.


 


Each Guarantor
acknowledges and agrees that (i) notwithstanding the conditions to
effectiveness set forth in this Amendment, such Guarantor is not required by
the terms of the Credit Agreement or any other Loan Document to consent to the
amendments to the Credit Agreement effected pursuant to this Amendment and
(ii) nothing in the Credit Agreement, this Amendment or any other Loan
Document shall be deemed to require the consent of such Guarantor to any future
amendments to the Credit Agreement.


 


[The remainder of page intentionally left blank.]


 


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IN
WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.


 


	
   

  	
  FTD, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  	
   

  
	
   

  	
  Name:  Jon R. Burney

  
	
   

  	
  Title:  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CREDIT SUISSE FIRST BOSTON, acting

  through its Cayman Islands Branch,

  individually and
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ ROBERT HETU

  
	
   

  	
  Name:  Robert Hetu

  
	
   

  	
  Title:  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ IAN W. NALITT

  	
   

  
	
   

  	
  Name: Ian W. Nalitt

  
	
   

  	
  Title: Associate

  



 


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[Lenders signature pages
omitted.]


 


 


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  GUARANTORS:

  	
   

  
	
   

  	
  MERCURY MAN HOLDINGS

  CORPORATION, as a
  Guarantor (for purposes

  of Section 6 hereof only)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ TIM FLYNN

  
	
   

  	
  Name: Tim Flynn

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FLORISTS’ TRANSWORLD DELIVERY, INC.,

  
	
   

  	
  as a Guarantor (for purposes of Section 6 hereof
  only)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VALUE NETWORK SERVICE, INC., as a

  
	
   

  	
  Guarantor (for purposes of Section 6 hereof

  only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FTD INTERNATIONAL CORPORATION,

  
	
   

  	
  as a Guarantor (for
  purposes of Section 6 hereof

  only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Secretary

  



 


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  FTD HOLDINGS, INCORPORATED, as a

  Guarantor (for purposes of Section 6 hereof

  only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FTD.COM, INC., as a Guarantor (for purposes

  of Section 6 hereof only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FLOWERS USA, INC., as a Guarantor (for

  purposes of Section 6 hereof only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  RENAISSANCE GREETING CARDS, INC.,

  as a Guarantor (for purposes of Section 6 hereof

  only)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /S/ JON R. BURNEY

  
	
   

  	
  Name: Jon R. Burney

  
	
   

  	
  Title: Secretary

  



 


S-4





















 


SCHEDULE
5.6


 


LITIGATION


 


1.                                          In
re FTD.COM Inc., Shareholder Litigation, Delaware Court of Chancery, New
Castle County, Consolidated C.A. No. 19458-NC, consolidated on August 4, 2003.
FTD, Inc. (“FTD”), on behalf of
all defendants, reached an agreement to settle these consolidated shareholder
actions that was approved by the Court on November 13, 2003.  Although the full amount of the specified
settlement payment has been reserved on FTD’s balance sheet, the portion of the
settlement payable to FTD’s former shareholders has not yet been made.


 


2.                                          Teleflora,
LLC v. Florists’ Transworld Delivery, Inc. (“FTDI”), United States District Court for the Northern District
of California, 5:03-cv-05858-JW, filed on December 30, 2003.  The complaint alleges, among other things,
misappropriation of trade secrets, copyright infringement, unfair competition,
intentional interference with contracts and various counts of fraud, through
among other things, unauthorized access to Teleflora software by FTDI.  Among other things, Teleflora claims that
FTDI “hacked” into certain of Teleflora’s flower shop management software and
systems licensed by individual florists and improperly modified Teleflora
software to permit florists to use the FTDI network to process orders or credit
card transactions.  Teleflora also claims
that some florists who have licensed a Teleflora shop management system were
improperly induced by FTDI sales representatives to cancel their agreements
with Teleflora and to install an FTDI system. 
Teleflora is seeking compensatory damages in excess of $5.0 million as
well as punitive damages and injunctive relief. 
FTDI has responded to the allegations made by Teleflora and is
vigorously defending against these claims.


 


3.                                          The
NCR claims for infringement of several internet patents have been settled and a
mutual release has been executed regarding any and all claims they have
asserted or could have asserted against FTD.COM or any of its affiliates up to
the date of the settlement which was June 18, 2004.


 


4.                                          The
New York Attorney General’s Office (“NYAG”)
delivered a notice dated April 4, 2003 indicating that it is currently
investigating a computer software malfunction related to the security of
personal customer information used to purchase products on the website
maintained by FTD.COM Inc.  In June 2003,
FTD.COM Inc. provided a written response to the issues raised in the NYAG
letter.  There have been no further communications
between FTD.COM Inc. and the NYAG.