(b) The following new definition of “NPA Final Payment” is added to Section 1.1 in theappropriate alphabetical order:          “‘NPA Final Payment’: The final principal payment made by the Borrower as ofDecember 13, 2009 on account of all its outstanding obligations to the Noteholders under theNote Purchase Agreement.”          (c) Section 7.1 is amended and restated to read in full as follows:          “7.1 Fixed Charge Coverage Ratio. The Borrower shall have andmaintain a Fixed Charge Coverage Ratio (measured on a rolling four quarterbasis) of not less than (a) 1.25 to 1.00 when the aggregate amount of thecurrent portion of principal payments on long-term Indebtedness (excludingthe Revolving Credit and the NPA Final Payment) of the Borrower, on aconsolidated basis, during such four quarter period then ending is equal toor greater than $1,000,000 and (b) 1.35 to 1.00 when the aggregate amount ofthe current portion of principal payments on long-term Indebtedness(excluding the Revolving Credit and the NPA Final Payment) of the Borrower,on a consolidated basis, during such four quarter period then ending is lessthan $1,000,000.”     **3. ****Amendment to the Loan Documents**. All references to the Loan Agreement in the LoanDocuments shall be deemed to refer to the Loan Agreement as amended hereby.     **4. ****Ratification of the Loan Documents**. Notwithstanding anything to the contraryherein contained or any claims of the parties to the contrary, the Administrative Agent, theLenders and the Borrower agree that the Loan Documents are in full force and effect and each suchdocument shall remain in full force and effect, as amended by this Amendment and the Borrowerhereby ratifies and confirms its obligations thereunder.     **5. ****Representations and Warranties**.          (a) The Borrower hereby certifies that after giving effect to this Amendment, (i) therepresentations and warranties of the Borrower in the Loan Agreement are true and correct in allmaterial respects as if made on the date hereof and (ii) no Event of Default and no event whichcould become an Event of Default with the passage of time or the giving of notice, or both, underthe Loan Agreement or the other Loan Documents exists on the date hereof.          (b) The Borrower further represents that the Borrower has all the requisite power andauthority to enter into and to perform its obligations under this Amendment, and that theexecution, delivery and performance of this Amendment have been duly authorized by all requisiteaction and will not violate or constitute a default under any provision of any applicable law,rule, regulation, order, writ, judgment, injunction, decree, determination or award presently ineffect or of the Certificate of Incorporation, by-laws or other organizational documents of theBorrower, or of any indenture, note, loan or loan agreement, license or any other agreement, leaseor instrument to which the Borrower is a party or by which the Borrower or any of its propertiesare bound.
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          (c) The Borrower also further represents that its obligations to repay the Advances, togetherwith all interest accrued thereon, are absolute and unconditional, and there exists no right of setoff or recoupment, counterclaim or defense of any nature whatsoever to payment of the Advances.          (d) The Borrower also further represents that there have been no changes to the Certificate ofIncorporation, by-laws or other organizational documents of the Borrower since the most recent datetrue and correct copies thereof were delivered to the Administrative Agent.     **6. ****Conditions Precedent**. The amendments set forth herein shall be effective as of theAmendment Effective Date upon the fulfillment, to the satisfaction of the Administrative Agent andits counsel, of the following conditions precedent:          (a) The Borrower shall have delivered to the Administrative Agent the following, all of whichshall be in form and substance satisfactory to the Administrative Agent and shall be duly completedand executed: (i) counterparts of this Amendment executed by theBorrower and the Majority Lenders;  (ii) the Consent and Acknowledgment of Guarantorsattached as Exhibit A hereto, executed by each Guarantor; and  (iii) such additional documents, certificates andinformation as the Administrative Agent may reasonably request.          (b) After giving effect to this Amendment, the representations and warranties set forth in theLoan Agreement shall be true and correct on and as of the date hereof.          (c) After giving effect to this Amendment, no Event of Default, and no event which, with thepassage of time or the giving of notice, or both, would become such an Event of Default shall haveoccurred and be continuing as of the date hereof.     **7. ****Miscellaneous**          (a) To induce the Administrative Agent and the Lenders to enter into this Amendment, theBorrower and each Guarantors waive and releases and forever discharges the Administrative Agent andthe Lenders and their respective officers, directors, attorneys, agents, and employees from anyliability, damage, claim, loss or expense of any kind of which it has knowledge as of the datehereof against any of them arising out of or relating to the Loan Documents. The Borrower furtheragrees to indemnify and hold the Administrative Agent, the Lenders and their respective officers,directors, attorneys, agents and employees (collectively, the “Indemnitees”) harmless from anyloss, damage, judgment, liability or expense (including reasonable attorneys’ fees), other than anysuch loss, damage judgment, liability or expense caused by the Indemnitee’s own willful misconductor gross negligence, suffered by or rendered against any of them on account of any claims arisingout of or relating to the Loan Documents.
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The Borrower and each Guarantor further states that it has carefully read the foregoingrelease and indemnity, knows the contents thereof and grants the same as its own free act and deed.          (b) All terms, conditions, provisions and covenants in the Loan Documents and all otherdocuments delivered to the Administrative Agent in connection therewith shall remain unaltered andin full force and effect except as modified or amended hereby. To the extent that any term orprovision of this Amendment is or may be deemed expressly inconsistent with any term or provisionin any Loan Document or any other document executed in connection therewith, the terms andprovisions hereof shall control.          (c) This Amendment constitutes the entire agreement of the parties with respect to the subjectmatter hereof and supersedes all prior and contemporaneous understandings and agreements.          (d) In the event any provisions of this Amendment shall be held invalid or unenforceable byany court of competent jurisdiction, such holding shall not invalidate or render unenforceable anyother provision hereof.          (e) This Amendment shall be governed by and construed according to the laws of theCommonwealth of Pennsylvania.          (f) This Agreement shall inure to the benefit of, and be binding upon, the parties hereto andtheir respective successors and assigns and may be executed in one or more counterparts, each ofwhich shall be deemed an original, but all of which together shall constitute one and the sameinstrument.          (g) The headings used in this Agreement are for convenience of reference only, do not form apart of this Amendment and shall not affect in any way the meaning or interpretation of thisAmendment.     **The Borrower expressly ratifies and confirms the waiver of jury trial provisions contained inthe Loan Documents.****[Signature Pages to Follow]**
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     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and yearfirst above written.         CSS INDUSTRIES, INC.           By: