Exhibit 10.1





EXHIBIT 10.1




SECOND AMENDMENT TO LOAN AGREEMENT




THIS SECOND AMENDMENT TO LOAN AGREEMENT (this “Amendment”) is made as of this 28th day of
September, 2010, by and among CSS INDUSTRIES, INC. (the “Borrower”), the lenders from time to time
parties to the Loan Agreement defined below (the “Lenders”), and PNC BANK, NATIONAL ASSOCIATION, as
Administrative Agent (the “Administrative Agent”) for the Lenders.



Background:




A. The Administrative Agent, the Lenders and the Borrower entered into a Second Amended and
Restated Loan Agreement dated as of November 21, 2008 (as heretofore modified and amended, the
“Loan Agreement”), pursuant to which the Lenders agreed to make Advances from time to time to the
Borrower.



B. The Borrower has requested and the Administrative Agent and the Lenders have agreed to
amend certain of the provisions in the Loan Agreement with respect to the Leverage Ratio covenant,
all on the terms and subject to the conditions set forth herein.



NOW, THEREFORE, in consideration of the foregoing and for good and valuable consideration, the
legality and sufficiency of which are hereby acknowledged, the parties hereto, intending to be
legally bound hereby, agree as follows:



1. Definitions. Capitalized terms used herein, including in the foregoing recitals,
and not otherwise defined herein shall have the meanings assigned to them in the Loan Agreement.



2. Amendment to Loan Agreement. The Loan Agreement is hereby amended effective as of
the date set forth above (the “Amendment Effective Date”) as follows:




Section 7.2 is amended and restated to read in full as follows:




“7.2 Leverage Ratio. The Borrower shall not permit, as of the end of
each fiscal quarter of the Borrower ending on the dates set forth below, the
Leverage Ratio to exceed the ratio set forth below opposite such dates:



	 	 	 
	Period	 	Ratio
	 
	 	 
	September 30
	 	3.50 to 1.00
	December 31 and June 30
	 	2.50 to 1.00
	March 31
	 	2.25 to 1.00







provided, however, that for the fiscal quarter ending September 30, 2010 the
required Leverage Ratio shall be 4.00 to 1.00.”


 


 









 





3. Amendment to the Loan Documents. All references to the Loan Agreement in the Loan
Documents shall be deemed to refer to the Loan Agreement as amended hereby.



4. Ratification of the Loan Documents. Notwithstanding anything to the contrary
herein contained or any claims of the parties to the contrary, the Administrative Agent, the
Lenders and the Borrower agree that the Loan Documents are in full force and effect and each such
document shall remain in full force and effect, as amended by this Amendment and the Borrower
hereby ratifies and confirms its obligations thereunder.




5. Representations and Warranties.



(a) The Borrower hereby certifies that after giving effect to this Amendment, (i) the
representations and warranties of the Borrower in the Loan Agreement are true and correct in all
material respects as if made on the date hereof and (ii) no Event of Default and no event which
could become an Event of Default with the passage of time or the giving of notice, or both, under
the 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 and
authority to enter into and to perform its obligations under this Amendment, and that the
execution, delivery and performance of this Amendment have been duly authorized by all requisite
action 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 in
effect or of the Certificate of Incorporation, by-laws or other organizational documents of the
Borrower, or of any indenture, note, loan or loan agreement, license or any other agreement, lease
or instrument to which the Borrower is a party or by which the Borrower or any of its properties
are bound.



(c) The Borrower also further represents that its obligations to repay the Advances, together
with all interest accrued thereon, are absolute and unconditional, and there exists no right of set
off 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 of
Incorporation, by-laws or other organizational documents of the Borrower since the most recent date
true and correct copies thereof were delivered to the Administrative Agent.



6. Conditions Precedent. The amendments set forth herein shall be effective as of the
Amendment Effective Date upon the fulfillment, to the satisfaction of the Administrative Agent and
its counsel, of the following conditions precedent:



(a) The Borrower shall have delivered to the Administrative Agent the following, all of which
shall be in form and substance satisfactory to the Administrative Agent and shall be duly completed
and executed:




	 	(i)	 	counterparts of this Amendment executed by the
Borrower and the Majority Lenders;




 


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	 	(ii)	 	the Consent and Acknowledgment of Guarantors
attached as Exhibit A hereto, executed by each Guarantor; and






	 	(iii)	 	such additional documents, certificates and
information as the Administrative Agent may reasonably request.





(b) After giving effect to this Amendment, the representations and warranties set forth in the
Loan 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 the
passage of time or the giving of notice, or both, would become such an Event of Default shall have
occurred and be continuing as of the date hereof.




7. Miscellaneous



(a) To induce the Administrative Agent and the Lenders to enter into this Amendment each of
the Borrower and the Guarantors waives and releases and forever discharges the Administrative Agent
and the Lenders and their respective officers, directors, attorneys, agents, and employees from any
liability, damage, claim, loss or expense of any kind of which it has knowledge as of the date
hereof against any of them arising out of or relating to the Loan Documents. The Borrower further
agrees to indemnify and hold the Administrative Agent, the Lenders and their respective officers,
directors, attorneys, agents and employees (collectively, the “Indemnitees”) harmless from any
loss, damage, judgment, liability or expense (including reasonable attorneys’ fees), other than any
such loss, damage judgment, liability or expense caused by the Indemnitee’s own willful misconduct
or gross negligence, suffered by or rendered against any of them on account of any claims arising
out of or relating to the Loan Documents. Each of the Borrower and the Guarantors further states
that it has carefully read the foregoing release 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 other
documents delivered to the Administrative Agent in connection therewith shall remain unaltered and
in full force and effect except as modified or amended hereby. To the extent that any term or
provision of this Amendment is or may be deemed expressly inconsistent with any term or provision
in any Loan Document or any other document executed in connection therewith, the terms and
provisions hereof shall control.



(c) This Amendment constitutes the entire agreement of the parties with respect to the subject
matter 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 by
any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any
other provision hereof.



(e) This Amendment shall be governed by and construed according to the laws of the
Commonwealth of Pennsylvania.


 


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(f) This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and
their respective successors and assigns and may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.



(g) The headings used in this Agreement are for convenience of reference only, do not form a
part of this Amendment and shall not affect in any way the meaning or interpretation of this
Amendment.



The Borrower expressly ratifies and confirms the waiver of jury trial provisions contained in
the 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 year
first above written.



	 	 	 	 	 
	 	CSS INDUSTRIES, INC.

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President — Finance 	 



 


 









 





	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION,

as a Lender and as Administrative Agent

 	 
	 	By:  	/s/ Meredith Jermann
 	 
	 	 	Name:  	Meredith Jermann 	 
	 	 	Title:  	Vice President 	 
	 
	 	WELLS FARGO BANK, N.A., successor in

interest to WACHOVIA BANK, NATIONAL

ASSOCIATION, as a Lender

 	 
	 	By:  	/s/ Stephen T. Dorosh
 	 
	 	 	Name:  	Stephen T. Dorosh 	 
	 	 	Title:  	Vice President 	 
	 
	 	CITIZENS BANK OF PENNSYLVANIA, as a Lender

 	 
	 	By:  	/s/ Jonathan H. Sprogell
 	 
	 	 	Name:  	Jonathan H. Sprogell 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	TD BANK, N.A., as a Lender

 	 
	 	By:  	/s/ Ted Hopkinson
 	 
	 	 	Name:  	Ted Hopkinson 	 
	 	 	Title:  	Senior Vice President 	 



 


 









 





EXHIBIT A




CONSENT AND ACKNOWLEDGMENT OF GUARANTORS




See Attached.



 


 









 





CONSENT AND ACKNOWLEDGMENT OF GUARANTORS




Each of the undersigned guarantors (each a “Guarantor”) consents to the provisions of the
foregoing Second Amendment to Loan Agreement (the “Amendment”) and confirms and agrees that: (a)
such Guarantor’s obligations under its Guaranty Agreement dated as of November 21, 2008 (as
heretofore amended, the “Guaranty”), relating to the Obligations (as defined in the Loan Agreement
referred to in the Amendment) shall be unimpaired by the Amendment; (b) such Guarantor has no
defenses, setoffs, counterclaims, discounts or charges of any kind against the Agent or any Lender,
or their respective officers, directors, employees, agents or attorneys with respect to its
Guaranty; (c) the provisions of Paragraph 7(a) of the Amendment are binding on such Guarantor as if
such Guarantor signed the Amendment; and (d) all of the terms, conditions and covenants in its
Guaranty remain unaltered and in full force and effect and are hereby ratified and confirmed and
apply to the Obligations, as modified by the Amendment. Each Guarantor certifies that all
representations and warranties made by such Guarantor in its Guaranty are true and correct in all
material respects as of the date hereof.



Each Guarantor expressly ratifies and confirms the waiver of jury trial provisions contained
in the Guaranty.



WITNESS the due execution of this Consent as of the date of the Amendment, intending to be
legally bound hereby.



	 	 	 	 	 
	 	PAPER MAGIC GROUP, INC.,

a Pennsylvania corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President 	 
	 
	 	BERWICK DELAWARE, INC.,

a Delaware corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	President 	 
	 
	 	BERWICK OFFRAY LLC, a Delaware

limited liability company

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President 	 



 


 









 





	 	 	 	 	 
	 	CLEO INC., a Tennessee corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President 	 
	 
	 	PHILADELPHIA INDUSTRIES, INC., a Delaware

corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	President 	 
	 
	 	LLM HOLDINGS, INC., Delaware corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	President 	 
	 
	 	THE PAPER MAGIC GROUP, INC.,

a Delaware corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	President 	 
	 
	 	LION RIBBON COMPANY, INC., a Delaware

corporation

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President 	 
	 
	 	C.R GIBSON, LLC, a Delaware limited liability

company

 	 
	 	By:  	/s/ Vincent A. Paccapaniccia
 	 
	 	 	Name:  	Vincent A. Paccapaniccia 	 
	 	 	Title:  	Vice President