Document:

EXHIBIT 10.1

 

 

 

FIRST AMENDMENT
 Dated as of December 7, 2016
 to
 AMENDED AND RESTATED CREDIT AGREEMENT

 

Dated as of January 16, 2015

 

among

 

HELEN OF TROY L.P., a Texas limited partnership

as the Borrower,

 

HELEN OF TROY LIMITED, a Bermuda company,

 

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and L/C Issuer,

 

and

 

The Other Lenders Party Hereto

 

JPMORGAN CHASE BANK, N.A.,
 as Syndication Agent,

 

BRANCH BANKING AND TRUST COMPANY,

BANK OF MONTREAL,

SUNTRUST BANK,

WELLS FARGO BANK, NATIONAL ASSOCIATION,

and

U.S. BANK NATIONAL ASSOCIATION,

as Co-Documentation Agents

 

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
 and
 JPMORGAN CHASE BANK, N.A.,
 as Joint Lead Arrangers and Joint Book Runners

 

 

 

 

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

 

THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “First Amendment”), dated as of December 7, 2016, is entered into among HELEN OF TROY L.P., a limited partnership duly organized under the laws of the State of Texas (the “Borrower”), HELEN OF TROY LIMITED, a Bermuda company (“Limited”), the lenders party hereto (the “Lenders”), and BANK OF AMERICA, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender (the “Administrative Agent”).

 

BACKGROUND

 

A.            The Borrower, Limited, the Lenders, and Bank of America, as the Administrative Agent, Swing Line Lender and L/C Issuer, are parties to that certain Amended and Restated Credit Agreement, dated as of January 16, 2015 (the “Credit Agreement”).  The terms defined in the Credit Agreement and not otherwise defined herein shall be used herein as defined in the Credit Agreement.

 

B.            The Borrower and Limited have requested that the Lenders amend the Credit Agreement to (i) increase the Aggregate Commitments to $1,000,000,000, (ii) extend the Maturity Date, (iii) add Wells Fargo Bank, National Association, U.S. Bank National Association and BMO Harris Bank N.A. as Lenders under the Credit Agreement (collectively, the “New Lenders”), (iv) remove MUFG Union Bank, N.A., Compass Bank and Royal Bank of Canada as Lenders under the Credit Agreement (collectively, the “Exiting Lenders”) and (v) make certain other amendments thereto, as more fully set forth herein.

 

C.            The Borrower, Limited, the Lenders and the Administrative Agent hereby agree to amend the Credit Agreement, subject to the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the covenants, conditions and agreements hereafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are all hereby acknowledged, the Borrower, Limited, the Lenders, and the Administrative Agent covenant and agree as follows:

 

1.             AMENDMENTS.

 

(a)           Section 1.01 of the Credit Agreement is hereby amended by adding the following defined terms thereto in proper alphabetical order:

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

 

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

 

“First Amendment” means that certain First Amendment to Amended and Restated Credit Agreement, dated as of December 7, 2016, among the Borrower, Limited, the Lenders and the Administrative Agent.

 

“First Amendment Effective Date” means the date that all conditions of effectiveness set forth in Section 3 of the First Amendment have been satisfied.

 

“Qualified Acquisition” means an Acquisition by Limited or any Subsidiary, which Acquisition has been designated to the Lenders in a Qualified Acquisition Notice as a “Qualified Acquisition”, provided that (a) the aggregate Acquisition Consideration is greater than $150,000,000 and (b) at the time of such Acquisition, the unpaid principal balance of the 2011 Senior Notes shall have been paid in full.

 

“Qualified Acquisition Notice” means a written notice from Limited to the Administrative Agent (a) delivered not later than 5 days prior to the date of closing of the proposed Qualified Acquisition and (b) which describes the Qualified Acquisition which is the basis for such request (including, without limitation, a pro forma calculation of the Leverage Ratio immediately prior to and after giving effect to such Qualified Acquisition, which calculation shall indicate that the Leverage Ratio immediately prior to such Qualified Acquisition is not greater than 3.50 to 1.00), and otherwise in form reasonably satisfactory to the Administrative Agent.

 

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

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(b)           The definition of “Aggregate Commitments” set forth in Section 1.01 of the Credit Agreement is hereby amended by adding the following sentence thereto to read as follows:

 

As of the First Amendment Effective Date, the amount of the Aggregate Commitments is $1,000,000,000.

 

(c)           The definition of “Arranger” set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

 

“Arranger” means, collectively, Merrill, Lynch, Pierce, Fenner & Smith Incorporated and JPMorgan Chase Bank, N.A., each in their capacity as a joint lead arranger and a joint bookrunner.

 

(d)           The definition of “Base Rate” set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

 

“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate in effect for such day plus 1/2 of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate” and (c) the Eurodollar Rate plus 1%; and if the Base Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.  The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate.  Any change in the Base Rate due to a change in the Federal Funds Rate, the prime rate or the rate for such Eurodollar Rate Loans shall be effective from and including the effective date of such change in the Federal Funds Rate, the prime rate or such Eurodollar Rate.

 

(e)           The definition of “Defaulting Lender: set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

 

“Defaulting Lender” means, subject to Section 2.16(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the L/C Issuer, the Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swing Line Loans) within two Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent, the L/C Issuer or the Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, 

 

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together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.  Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.16(b)) as of the date established therefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent to the Borrower, the L/C Issuer, the Swing Line Lender and each other Lender promptly following such determination.

 

(f)            The definition of “Guarantors” set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

 

“Guarantors” means, collectively, Limited, HOT-Barbados, HOT-Nevada, HOT Nevada, Inc., a Nevada corporation, Helen of Troy Texas Corporation, a Texas corporation, Idelle Labs, Ltd., a Texas limited partnership, OXO International, Ltd., a Texas limited partnership, Helen of Troy Macao Commercial Offshore Limited, a Macau company, Kaz, Inc., a New York corporation, Kaz USA, Inc., a Massachusetts corporation, Kaz Canada, Inc., a Massachusetts corporation, Healthy Directions, LLC, a Delaware limited liability company, Doctors’ Preferred, LLC, a Delaware limited liability company, Healthy Directions Publishing, LLC, a Delaware limited liability company, Pur Water Purification Products, Inc., an Ohio corporation, Steel Technology, LLC, an Oregon limited liability company, HD Holding Inc., a Nevada corporation, and each other Subsidiary that executes a Guaranty pursuant to Section 7.02(i)(v).

 

(g)           The definition of “Maturity Date” set forth in Section 1.01 of the Credit Agreement is hereby amended to read as follows:

 

“Maturity Date” means December 7, 2021; provided, however, that if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.

 

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(h)           Section 2.01 of the Credit Agreement is hereby amended by amending the first sentence thereto to read as follows:

 

Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans in Dollars (each such loan, a “Revolving Loan”) to the Borrower from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Revolving Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii) the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment.

 

(i)            The dollar amount “$150,000,000” set forth in Section 2.14(a) of the Credit Agreement is hereby deleted and “$200,000,000” is hereby inserted in lieu thereof.

 

(j)            Section 2.16(a)(iv) of the Credit Agreement is hereby amended to read as follows:

 

(iv)          Reallocation of Applicable Percentages to Reduce Fronting Exposure.  All or any part of such Defaulting Lender’s participation in L/C Obligations and Swing Line Loans shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment.  Subject to Section 10.22, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

 

(k)           Section 5.20(a) of the Credit Agreement is hereby amended to read as follows:

 

(a)           The Borrower, each other Loan Party and each Subsidiary of any Loan Party, and to the knowledge of the Borrower and each other Loan Party, each director, officer, employee, agent, affiliate or representative thereof, is: (i) not the subject of any Sanctions, nor located, organized or resident in a country or territory that is the subject of Sanctions, nor, to the knowledge of the Borrower or any other Loan Party, controlled by a Person or Persons that are the subject of Sanctions; (ii) in compliance in all material respects with all relevant Sanctions; (iii) not in receipt of any written notice from the Secretary of State of the Attorney General of the United States or any other department, agency or office of the United States claiming a violation or possible violation of OFAC or the Act; (iv) not listed as a Specially Designated Terrorist (as defined in the Act) or on any other list of terrorists or terrorist organizations maintained pursuant to the Act; (v) not a Person who has been determined by competent governmental authority to be subject to any of the prohibitions contained in the Act; and (vi) not controlled by or, to the Borrower’s knowledge, now acting on behalf of any Person named in Annex to Executive Order Nos. 12947, 13099 and 13224 and all modifications thereto or thereof (the “Annex”) or any other list promulgated under the Act or any other Person who has been determined to be subject to the prohibitions contained in the Act.

 

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(l)            Section 5.21 of the Credit Agreement is hereby amended by adding the following sentence at the end thereof to read as follows:

 

No part of the proceeds of any Loans will be used, directly or indirectly, in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any applicable Anti-Corruption Laws.

 

(m)          Article V of the Credit Agreement is hereby further amended by adding the following new Section 5.23 thereto to read as follows:

 

Section 5.23         EEA Financial Institution.  No Loan Party is an EEA Financial Institution.

 

(n)           Section 7.02(i) of the Credit Agreement is hereby amended to read as follows:

 

(i)            Investments as a result of Acquisitions, if each of the following conditions has been satisfied:  (i) immediately before and after giving effect to such Acquisition, no Default shall have occurred and be continuing, (ii)(A) if such Acquisition is a Qualified Acquisition, immediately before and after giving effect to such Acquisition, the Borrower is in compliance with Section 7.11(b) or (B) if such Acquisition is not a Qualified Acquisition, immediately before and after giving effect to such Acquisition,  the Leverage Ratio on a pro forma basis is not greater than (y) 3.00 to 1.00 if any of the 2011 Senior Notes are outstanding and (z) 3.25 to 1.00 if the 2011 Senior Notes are not outstanding or the maximum leverage ratio permitted under the 2011 Senior Note Agreement is increased to 3.50 to 1.00, (iii) immediately before and after giving effect to such Acquisition, Liquidity will be at least $25,000,000, (iv) such Acquisition shall not be opposed by the board of directors or similar governing body of the Person or assets being acquired and (v) if the Acquisition results in a Domestic Subsidiary being acquired having a net worth at the time of such Acquisition of more than $10,000,000, such Subsidiary shall execute and deliver to the Administrative Agent (x) a Guaranty, (y) such documents of the types referred to in clauses (iv) and (v) of Section 4.01(a) and (z) a favorable opinion of counsel to such Person located in the jurisdiction of organization of such Person, in form, content and scope reasonably satisfactory to the Administrative Agent;

 

(o)           Section 7.02(k) of the Credit Agreement is hereby amended to read as follows:

 

(k)           Investments by a Subsidiary (other than a Loan Party) in any other Subsidiary;

 

(p)           Section 7.11(b) of the Credit Agreement is hereby amended to read as follows:

 

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(b)           Leverage Ratio.  Permit the Leverage Ratio to be greater than (i) 3.25 to 1.00 at any time during which any of the 2011 Senior Notes are outstanding and (ii) 3.50 to 1.00 at any time during which the 2011 Senior Notes are not outstanding or the maximum leverage ratio permitted under the 2011 Senior Note Agreement is increased to 3.50 to 1.00; provided, however, notwithstanding the foregoing, and following the delivery of a Qualified Acquisition Notice, (A) for the fiscal quarter in which such Qualified Acquisition is consummated, the Leverage Ratio shall not at any time during thereof exceed 4.25 to 1.00, (B) for the first, second and third fiscal quarters immediately following the fiscal quarter in which such Qualified Acquisition was consummated, the Leverage Ratio shall not at any time during thereof exceed 4.00 to 1.00, and (C) for the fourth fiscal quarter immediately following the fiscal quarter in which such Qualified Acquisition was consummated, the Leverage Ratio shall not at any time during thereof exceed 3.75 to 1.00.

 

(q)           Section 10.01(e) of the Credit Agreement is hereby amended to read as follows:

 

(e)           change Section 2.13 or Section 8.03 in a manner that would alter the pro rata sharing of payments required thereby or the order in which Obligations are paid without the written consent of each Lender;

 

(r)            Article X of the Credit Agreement is hereby further amended by adding the following new Section 10.22 thereto to read as follows:

 

Section 10.22       Acknowledgment and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)           the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an EEA Financial Institution; and

 

(b)           the effects of any Bail-in Action on any such liability, including, if applicable:

 

(i)            a reduction in full or in part or cancellation of any such liability;

 

(ii)           a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

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(iii)          the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.

 

(s)            Schedule 2.01 of the Credit Agreement is hereby amended to be in the form of Schedule 2.01 to this First Amendment, and the Commitment and Applicable Percentage of each Lender are hereby amended or established, as the case may be, as set forth herein.

 

(t)            The Compliance Certificate, Exhibit E, is hereby amended to be in the form of Exhibit E to this First Amendment.

 

2.             REPRESENTATIONS AND WARRANTIES.  By its execution and delivery hereof, each of the Borrower and Limited represents and warrants as follows:

 

(a)           Limited and the Borrower have all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to execute, deliver and perform their respective obligations under this First Amendment and each Revolving Loan Note in the amount of each Lender’s Commitment after giving effect to this First Amendment (the “New Revolving Loan Notes”).

 

(b)           The execution, delivery and performance by Limited and the Borrower of this First Amendment and the New Revolving Loan Notes has been duly authorized by all necessary corporate or other organizational action, and do not and will not (i) contravene the terms of either of such Person’s Organization Documents; (ii) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (A) any Contractual Obligation to which either Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which either Person or its property is subject; or (iii) violate any Law.  Limited and each of its Subsidiaries is in compliance with all Contractual Obligations referred to in clause (ii)(A) above except to the extent that failure to do so could not reasonably be expected to result in a Material Adverse Effect.

 

(c)           No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against Limited and the Borrower of this First Amendment or the New Revolving Loan Notes, as the case may be.

 

(d)           This First Amendment has been duly executed and delivered by Limited and the Borrower.  The New Revolving Loan Notes have been duly executed and delivered by the Borrower.  This First Amendment constitutes a legal, valid and binding obligation of Limited and the Borrower, enforceable against each of Limited and the Borrower in accordance with its terms, subject as to enforcement to any Debtor Relief Laws and general equitable principles.  The New Revolving Loan Notes constitute a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with their terms, subject as to enforcement to any Debtor Relief Laws and general equitable principles.

 

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3.             CONDITIONS TO EFFECTIVENESS.  This First Amendment shall be effective upon satisfaction or completion of the following:

 

(a)           the Administrative Agent shall have received counterparts of this First Amendment executed by the Lenders and acknowledged by the Exiting Lenders for the purpose of Section 4 hereof only;

 

(b)           the Administrative Agent shall have received counterparts of this First Amendment executed by the Borrower and Limited and acknowledged by each Guarantor;

 

(c)           the Administrative Agent shall have received executed New Revolving Loan Notes for each New Lender and each other Lender whose Commitment is revised pursuant to this First Amendment;

 

(d)           each of the conditions in Section 4.02(a) and (b) of the Credit Agreement shall have been satisfied (as if the Borrower were Borrowing as of the date of this First Amendment); and

 

(e)           the Administrative Agent shall have received a (i) Secretary’s Certificate of Helen of Troy Nevada Corporation (“HTNC”), containing Exhibit A, Articles of Incorporation of HTNC, certified by the Nevada Secretary of State, Exhibit B, Bylaws of HTNC, Exhibit C, Certificate of Limited Partnership certified by the Texas Secretary of State and Agreement of Limited Partnership of the Borrower, Exhibit D, Unanimous Written Consent of the Board of Directors of HTNC approving the execution, delivery and performance of the First Amendment and the New Revolving Loan Notes, and Exhibit E, Incumbency; (ii) Certificate of Fact, certified by the Texas Secretary of State for the Borrower; (iii) Certificate of Existence with Status in Good Standing for HTNC, certified by the Nevada Secretary of State; and (iv) Secretary’s Certificate of Limited, containing Exhibit A, Memorandum of Association of Limited, Exhibit B, Bye-Laws of Limited, Exhibit C, Incumbency, and Exhibit D, Unanimous Consent of the Board of Directors of Limited;

 

(f)            the Administrative Agent shall have received opinions of legal counsel to the Borrower and Limited covering the matters set forth in Sections 2(a), (b), (c) and (d) of this First Amendment;

 

(g)           the Administrative Agent shall have received for its benefit and the benefit of each Lender (other than the Exiting Lenders) and the Arranger the fees in immediately available funds as agreed upon by the Borrower, Limited, the Administrative Agent, the Arranger and the Lenders;

 

(h)           the legal fees and expenses of Winstead PC, counsel for the Administrative Agent, shall have been paid immediately available funds;

 

(i)            the Administrative Agent shall have received counterparts of Guaranty Supplement No. 2 executed by HD Holding Inc., together with a Secretary’s Certificate, Certificate of Incorporation, Bylaws, Incumbency, Resolutions and a legal opinion in form and substance satisfactory to the Administrative Agent and its counsel;

 

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(j)            the Exiting Lenders shall have received payment in full in immediately available funds for all amounts due them under the Credit Agreement and the other Loan Documents; and

 

(k)           the Administrative Agent shall have received, in form and substance satisfactory to the Administrative Agent and its counsel, such other documents, certificates and instruments as the Administrative Agent shall reasonably require.

 

4.             EXITING LENDERS.  By acknowledging and agreeing as provided on the signature pages hereof, each of the Exiting Lenders, upon satisfaction of the conditions of effectiveness set forth in Section 3 of this First Amendment, shall not (a) be a Lender under the Credit Agreement and (b) have any rights or obligations with respect to being a Lender, except for those that expressly survive termination of the Credit Agreement or termination of any Commitment thereunder.

 

5.             REFERENCE TO THE CREDIT AGREEMENT.

 

(a)           Upon the effectiveness of this First Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”, or words of like import shall mean and be a reference to the Credit Agreement, as affected and amended hereby.

 

(b)           The Credit Agreement, as amended by the amendments referred to above, shall remain in full force and effect and is hereby ratified and confirmed.

 

6.             COSTS, EXPENSES AND TAXES.  The Borrower agrees to pay on demand all reasonable costs and expenses of the Administrative Agent in connection with the preparation, reproduction, execution and delivery of this First Amendment and the other instruments and documents to be delivered hereunder (including the reasonable fees and out-of-pocket expenses of counsel for the Administrative Agent with respect thereto).

 

7.             GUARANTOR’S ACKNOWLEDGMENT.  By signing below, each Guarantor (a) acknowledges, consents and agrees to the execution, delivery and performance by the Borrower and Limited of this First Amendment, (b) acknowledges and agrees that its obligations in respect of its Guaranty (i) are not released, diminished, waived, modified, impaired or affected in any manner by this First Amendment or any of the provisions contemplated herein and (ii) also cover the Aggregate Commitments and the Revolving Loans as increased by this First Amendment, (c) ratifies and confirms its obligations under its Guaranty, and (d) acknowledges and agrees that it has no claims or offsets against, or defenses or counterclaims to, its Guaranty.

 

8.             NEW LENDER REPRESENTATIONS AND AGREEMENTS.  (a) Each New Lender represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Agreement and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under the terms of the Credit Agreement, (iii) from and after the First Amendment Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Revolving Loans and either it, or the Person exercising discretion in making its decision to acquire such Revolving Loans, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit

 

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Agreement and other Loan Documents requested by it, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6.01 of the Credit Agreement, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Agreement and to purchase such Loans, and (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this First Amendment and join the Credit Agreement and the other Loan Documents as a Lender and to purchase and make, as the case may be, its Applicable Percentage (after giving effect to this First Amendment) of the Revolving Loans; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.  Pursuant to Section 10.06(b)(iii) of the Credit Agreement, the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender hereby consent to the assignment to each New Lender provided for herein.

 

9.                                      PURCHASE/SALE BY LENDERS.  Simultaneously with the satisfaction of the conditions to effectiveness set forth in Section 3 of this First Amendment, each Lender (other than the Exiting Lenders) shall purchase or sell (as the case may be), without recourse, an amount of the Revolving Loans outstanding such that, after giving effect to this First Amendment, the amount of each Lender’s Commitment utilized and the amount of Revolving Loans owed to each Lender will be equal to its Applicable Percentage thereof after giving effect to the First Amendment.  The Borrower shall pay each Lender compensation for any losses pursuant to Section 3.05 of the Credit Agreement as a result of any purchases or sales.  Each Lender hereby waives the requirement in Section 2.13 of the Credit Agreement that all payments on the Obligations be made pro rata solely for purposes of payment of all Obligations due and owing to the Exiting Lenders.

 

10.                               EXECUTION IN COUNTERPARTS.  This First 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 shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument.  For purposes of this First Amendment, a counterpart hereof (or signature page thereto) signed and transmitted by any Person party hereto to the Administrative Agent (or its counsel) by facsimile machine or other electronic imaging means (e.g. “pdf” or “tif”) is to be treated as an original.  The signature of such Person thereon, for purposes hereof, is to be considered as an original signature, and the counterpart (or signature page thereto) so transmitted is to be considered to have the same binding effect as an original signature on an original document.

 

11.                               GOVERNING LAW; BINDING EFFECT.  This First Amendment shall be governed by and construed in accordance with the laws of the State of Texas applicable to agreements made and to be performed entirely within such state, provided that each party shall retain all rights arising under federal law, and shall be binding upon the parties hereto and their respective successors and assigns.

 

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12.                               HEADINGS.  Section headings in this First Amendment are included herein for convenience of reference only and shall not constitute a part of this First Amendment for any other purpose.

 

13.                               ENTIRE AGREEMENT.  THE CREDIT AGREEMENT, AS AMENDED BY THIS FIRST AMENDMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK

 

12

 

IN WITNESS WHEREOF, this First Amendment is executed as of the date first set forth above.

 

	
 
    	
HELEN OF TROY L.P.,   a Texas limited partnership
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
HELEN OF TROY NEVADA   CORPORATION, a Nevada corporation, General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brian Grass
    
	
 
    	
 
    	
Brian Grass
    
	
 
    	
 
    	
Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
HELEN OF TROY LIMITED,   a Bermuda corporation
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brian Grass
    
	
 
    	
 
    	
Brian Grass
    
	
 
    	
 
    	
Chief Financial Officer
    

 

Signature Page to First Amendment

 

 

	
 
    	
BANK OF AMERICA, N.A.,
    
	
 
    	
as Administrative Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/Priscilla Baker
    
	
 
    	
Name:
    	
Priscilla Baker
    
	
 
    	
Title:
    	
AVP
    

 

Signature Page to First Amendment

 

 

	
 
    	
BANK OF AMERICA, N.A.,
    
	
 
    	
as a Lender, L/C Issuer   and Swingline Lender
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Adam Rose
    
	
 
    	
Name:
    	
Adam Rose
    
	
 
    	
Title:
    	
SVP
    

 

Signature Page to First Amendment

 

 

	
 
    	
JPMORGAN CHASE BANK,   N.A.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Maria Riaz
    
	
 
    	
Name:
    	
Maria Riaz
    
	
 
    	
Title:
    	
Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
BRANCH BANKING AND TRUST   COMPANY
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Erron Powers
    
	
 
    	
Name:
    	
Erron Powers
    
	
 
    	
Title:
    	
Senior Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
HSBC BANK USA, N.A.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Koby West
    
	
 
    	
Name:
    	
Koby West
    
	
 
    	
Title:
    	
Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
SUNTRUST BANK
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Justin Lien
    
	
 
    	
Name:
    	
Justin Lien
    
	
 
    	
Title:
    	
Director
    

 

Signature Page to First Amendment

 

 

	
 
    	
COMERICA BANK
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Gerald R. Finney   Jr.
    
	
 
    	
Name:
    	
Gerald R. Finney Jr.
    
	
 
    	
Title:
    	
Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
FIFTH THIRD BANK, an   Ohio Banking Corporation
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ James Holucker
    
	
 
    	
Name:
    	
James Holucker
    
	
 
    	
Title:
    	
Relationship Manager
    

 

Signature Page to First Amendment

 

 

	
 
    	
CITIBANK, N.A.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Paul V. Pholan
    
	
 
    	
Name:
    	
Paul V. Pholan
    
	
 
    	
Title:
    	
Director
    

 

Signature Page to First Amendment

 

 

	
 
    	
WELLS FARGO BANK,   NATIONAL ASSOCIATION
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Joseph Gricco
    
	
 
    	
Name:
    	
Joseph Gricco
    
	
 
    	
Title:
    	
Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
U.S. BANK NATIONAL   ASSOCIATION
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Kara P. Van Duzee
    
	
 
    	
Name:
    	
Kara P. Van Duzee
    
	
 
    	
Title:
    	
Vice President
    

 

Signature Page to First Amendment

 

 

	
 
    	
BMO HARRIS BANK N.A.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Mark W. Plakos
    
	
 
    	
Name:
    	
Mark W. Plakos
    
	
 
    	
Title:
    	
Managing Director
    

 

Signature Page to First Amendment

 

 

	
 
    	
ACKNOWLEDGED AND AGREED   BY EXITING LENDERS FOR PURPOSES OF SECTION 4 HEREOF ONLY:
    
	
 
    	
 
    
	
 
    	
MUFG UNION BANK, N.A.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Susan Swerdloff
    
	
 
    	
Name:
    	
Susan Swerdloff
    
	
 
    	
Title:
    	
Managing Director
    
	
 
    	
 
    	
 
    
	
 
    	
COMPASS BANK
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Timothy R. Coffey
    
	
 
    	
Name:
    	
Timothy R. Coffey
    
	
 
    	
Title:
    	
Senior Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
ROYAL BANK OF CANADA
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Nikhil Madhok
    
	
 
    	
Name:
    	
Nikhil Madhok
    
	
 
    	
Title:
    	
Authorized Signatory
    

 

Signature Page to First Amendment

 

 

ACKNOWLEDGED AND AGREED PURSUANT TO SECTION 7 ABOVE:

 

	
GUARANTORS:
    
	
 
    
	
HELEN   OF TROY L.P.,
    
	
a   Texas limited partnership
    
	
 
    	
 
    
	
By:
    	
HELEN OF TROY NEVADA   CORPORATION,
    
	
 
    	
 a Nevada corporation, General Partner
    
	
 
    	
 
    
	
HELEN   OF TROY LIMITED,
    
	
a   Bermuda company
    
	
 
    
	
HELEN   OF TROY LIMITED,
    
	
a   Barbados corporation
    
	
 
    
	
HOT   NEVADA, INC.,
    
	
a   Nevada corporation
    
	
 
    
	
HELEN   OF TROY NEVADA CORPORATION,
    
	
a   Nevada corporation
    
	
 
    
	
HELEN   OF TROY TEXAS CORPORATION,
    
	
a   Texas corporation
    
	
 
    
	
IDELLE   LABS LTD.,
    
	
a   Texas limited partnership
    
	
 
    
	
By:
    	
HELEN OF TROY NEVADA   CORPORATION,
    
	
 
    	
 a Nevada corporation, General Partner
    
	
 
    	
 
    
	
OXO   INTERNATIONAL LTD.,
    
	
a   Texas limited partnership
    
	
 
    	
 
    
	
By:
    	
HELEN OF TROY NEVADA   CORPORATION,
    
	
 
    	
 a Nevada corporation, General Partner
    
	
 
    
	
PUR   WATER PURIFICATION PRODUCTS, INC.,
    
	
a   Nevada corporation
    
	
 
    
	
KAZ, INC.,
    
	
a   New York corporation
    
	
 
    
	
KAZ   USA, INC.,
    
	
a   Massachusetts corporation
    
	
 
    
	
KAZ   CANADA, INC.,
    
	
a   Massachusetts corporation
    
	
 
    
	
HEALTHY   DIRECTIONS, LLC,
    
	
a   Delaware limited liability company
    
	
 
    
	
DOCTORS’   PREFERRED, LLC,
    
	
a   Delaware limited liability company
    
	
 
    
	
STEEL   TECHNOLOGY, LLC,
    
	
an   Oregon limited liability company
    

 

Signature Page to First Amendment

 

 

	
HEALTHY   DIRECTIONS PUBLISHING, LLC,
    	
 
    
	
a   Delaware limited liability company
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Brian L. Grass
    	
 
    
	
 
    	
 Brian L. Grass
    	
 
    
	
 
    	
 Title for all: Chief Financial Officer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
HELEN OF TROY MACAO   COMMERCIAL OFFSHORE LIMITED,
    	
 
    
	
a   Macau corporation
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Vincent D. Carson
    	
 
    
	
 
    	
 Name:
    	
Vincent D. Carson
    	
 
    
	
 
    	
 Title:
    	
Manager
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
NOTARIAL   CERTIFICATE OF
    	
Brian   L. Grass
    	
 
    
					

 

NOTARY PUBLIC DO HEREBY CERTIFY AND ATTEST that on the day of the date hereof personally came and appeared before me Brian L. Grass, the duly authorized Chief Financial Officer of Helen of Troy Limited, a Barbados corporation, one of the executing parties to the within written document and did in my presence sign and deliver the same as and for his free and voluntary act and deed.

 

IN FAITH AND TESTIMONY WHEREOF I the said Rosemary Vasquez have hereunto set and subscribed my name and caused my Seal of Office to be hereunto put and affixed this 6th day of December, 2016.

 

Signature Page to First AmendmentExhibit 10.1

 

FIRST AMENDMENT TO EMPLOYMENT AND NON-COMPETITION AGREEMENT

 

THIS FIRST AMENDMENT TO EMPLOYMENT AND NON-COMPETITION AGREEMENT (this “Amendment”) is entered into as of December 8, 2016 (the “Effective Date”), by and between David Brush (the “Employee”) and CPI Card Group-Colorado, Inc. (the “Company”). Any terms used but not defined herein shall have the same meaning as in that certain Employment and Non-Competition Agreement, effective June 22, 2015, by and between CPI Acquisition, Inc. and the Employee (the “Employment Agreement”).

 

RECITALS

 

WHEREAS, the Employee has been employed by the Company as Chief Financial Officer pursuant to the Employment Agreement;

 

WHEREAS, the Employee will continue to be employed by the Company through December 31, 2016 or such earlier date pursuant to the terms of the Employment Agreement (the “Employment Separation Date”);

 

WHEREAS, following the Employment Separation Date, the parties have agreed that the Employee shall provide services to the Company solely in a transition and advisory role as a consultant through June 30, 2017; and

 

WHEREAS, the Employee and the Company desire to amend the Employment Agreement to set forth the terms of the Employee’s employment with the Company from the Effective Date through the Employment Separation Date and the terms of the Employee’s consulting relationship with the Company thereafter.

 

NOW, THEREFORE, in consideration of the promises and covenants contained herein, the Company and the Employee agree as follows:

 

AGREEMENT

 

1.                                      Amendment. The Employment Agreement is hereby amended as follows:

 

(a)                                 Section 2.1 of the Employment Agreement is hereby deleted and replaced in its entirety with the following:

 

“Term. The Company shall employ the Employee, and the Employee shall serve the Company, for a continuous term beginning on June 22, 2015 (the “Effective Date”) and ending on December 31, 2016, unless the Employee’s employment is earlier terminated pursuant to this Agreement (the “Term”).”

 

(b)                                 The first sentence of each of Sections 2.2(a) and (b) of the Employment Agreement is hereby amended by replacing “The” with “During the Term, the”.

 

(c)                                  Section 2.2(a) of the Employment Agreement is hereby amended by adding the following at the end thereof:

 

“Notwithstanding the foregoing, in the event that the Company appoints a successor Chief Financial Officer prior to the end of the Term, then the Employee will serve the remainder of the Term as a non-executive employee of the Company, and thereafter, all references in

 

1

 

this Agreement to “Chief Financial Officer” shall be replaced with “non-executive employee of the Company”.”

 

(d)                                 The last sentence of Section 2.3(a) of the Employment Agreement is hereby deleted in its entirety.

 

(e)                                  Section 2.3(b) of the Employment Agreement is hereby deleted in its entirety and replaced with the following:

 

“2016 Incentive Compensation. During the Term, the Employee shall be eligible to participate in the Company’s incentive cash bonus program on the same basis as similarly compensated senior executives of the Company, subject to the terms and conditions thereof. Pursuant to the incentive cash bonus program, the Employee will have the opportunity for an incentive cash bonus with respect to the 2016 calendar year at a target of up to 50% of the Annual Base Salary, depending on performance metrics agreed upon in writing by the CEO and the Compensation Committee (the “2016 Annual Bonus”), with such performance to be determined in good faith by the Compensation Committee. The 2016 Annual Bonus will be paid to the Employee solely in the form of cash, notwithstanding the payment of annual incentives to similarly situated senior executives in cash and/or in other forms. The 2016 Annual Bonus is not guaranteed, and except as otherwise provided in this Agreement, the Employee must be employed by the Company at the close of the 2016 calendar year to be eligible for any such 2016 Annual Bonus. Any 2016 Annual Bonus amount payable under this Section 2.3(b) shall be paid to the Employee by no later than March 31, 2017.”

 

(f)                                   Section 2.3(c) of the Employment Agreement is hereby deleted in its entirety and replaced with “[Reserved.]”.

 

(g)                                  The parties hereto agree that this Amendment shall not give rise to “good reason” for termination of employment pursuant to Section 6.1(e) of the Employment Agreement.

 

(h)                                 Section 6.1(e) of the Employment Agreement is hereby amended by replacing clause (ii) with the following: “(ii) material diminution of his duties, responsibilities, or authority, other than pursuant to the transition of the Employee’s duties from Chief Financial Officer to non-executive employee of the Company prior to the end of the Term, as contemplated by Section 2.2(a) of this Agreement;”.

 

(i)                                     Section 6.1(f) of the Employment Agreement is hereby deleted in its entirety.

 

(j)                                    The first sentence of Section 6.2(a) of the Employment Agreement is hereby amended by replacing the beginning of the sentence through the reference to Section 2.1 of the Employment Agreement with the following: “Upon the termination by the Company of the Employee’s employment pursuant to Section 6.1(c),”.

 

(k)                                 The second sentence of Section 6.2(a) of the Employment Agreement is hereby amended by replacing the beginning of the sentence through the reference to Section 2.1 of the Employment Agreement with the following: “Upon the termination of the Employee’s employment pursuant to Section 6.1(a) or (b) or by the Company pursuant to Section 6.1(d),”.

 

(l)                                     Section 6.2(b) of the Employment Agreement is hereby deleted and replaced in its entirety with the following:

 

2

 

“Severance Benefits. Upon (i) any termination by the Company of the Employee’s employment pursuant to Section 6.1(d) prior to the end of the Term, (ii) the Employee’s termination of employment for good reason pursuant to Section 6.1(e) prior to the end of the Term, or (iii) termination of the Employee’s employment pursuant to Section 6.1(a) or (b) prior to the end of the Term (each, a “Severance Termination Event”), and the execution and delivery by the Employee or the Employee’s legal representative to the Company of a general release in form and substance satisfactory to the Company in its reasonable discretion, the Company shall pay to the Employee or, in the event of the Employee’s death, the Employee’s designated beneficiary or estate a severance payment calculated by using the Base Salary plus the Employee’s estimated 2016 Annual Bonus amount, as determined by the Board in good faith in accordance with the short term incentive plan design then in effect. The severance payment will be made in equal installments during the Severance Period in a manner consistent with the Company’s usual payroll cycle. Subject to the terms of the applicable plan documents, and in accordance with the Company’s policies applicable to similarly situated employees, medical, prescription drug, dental, vision and health benefits coverage shall be continued on behalf of Employee and his covered dependents until the end of the Severance Period on the same terms as were provided to the Employee by the Company immediately prior to such termination. In the event of a Severance Termination Event, (A) the Employee’s then-unvested restricted shares of common stock of CPI Holdings (the “Restricted Shares”) granted pursuant to that certain Restricted Stock Award Agreement, dated June 22, 2015 (the “Restricted Stock Award Agreement”), shall continue to vest in accordance with the terms set forth in the Restricted Stock Award Agreement during the Severance Period, and (B) the aggregate number of shares or units under any individual time-vesting equity or long-term incentive awards granted under the Company’s incentive plan (“LTI Awards”) held by the Employee will be no less than (without duplication of the prior vesting of any portion of such award) (I) the number of time-vesting LTI Awards granted to the Employee by the Company multiplied by (II) a fraction, (x) the numerator of which is the number of days that the Employee was employed by the Company from the date the LTI Awards were granted to the date of the Employee’s termination and (y) the denominator of which is the total number of days that represents the full vesting period in the aggregate with respect to such time-vesting LTI Award.  The parties hereto agree that if any award agreement with respect to such time-vesting LTI Award shall provide terms that are more favorable than as set forth herein with respect to any time-vesting LTI Award of the Company, any such award agreement shall control.”

 

2.                                      Release Agreement. This Amendment shall become effective upon the Employee’s timely execution and non-revocation of the general release of claims attached hereto as Exhibit A (the “Release”). If the Employee fails to timely execute the Release, or timely revokes the Release, this Amendment shall be null and void.

 

3.                                      Consulting Agreement. Following the Employment Separation Date, the Company and the Employee agree to enter into, and the Employee agrees to provide transition and advisory services to the Company as reasonably requested by the Company’s President and Chief Executive Officer, Chief Human Resources Officer, and/or the Board of Directors pursuant to, the Consulting Agreement attached hereto as Exhibit B, which the parties hereto agree will be executed on the Employment Separation Date.

 

4.                                      Miscellaneous.

 

(a)                                 Governing Law. This Amendment shall be governed and construed in accordance with the laws of Illinois without giving effect to its conflicts of law provisions.

 

3

 

(b)                                 Severability. If any provision of this Amendment is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not affect the remaining provisions of this Amendment, which shall be fully severable, and given full force and effect.

 

(c)                                  Counterparts. This Amendment may be signed in counterparts, each of which shall be deemed an original and all of which together shall be one and the same instrument.  A signature hereon sent by facsimile or other electronic means shall be as effective as an original signature.

 

(d)                                 References to Employment Agreement. All references in any document or agreement to the Employment Agreement shall refer to the Employment Agreement, as amended hereby.

 

(e)                                  Supersession. To the extent, if any, that a provision of this Amendment conflicts with or differs from any provision of the Employment Agreement, such provision of this Amendment shall prevail and govern for all purposes and in all respects.

 

(f)                                   Full Force and Effect. Except as otherwise specifically amended by this Amendment, the Employment Agreement (including, without limitation, the Employee’s obligations pursuant to Sections 3, 4 and 5 thereof, and other surviving provisions) shall remain in full force and effect.

 

[Signature Page Follows]

 

4

 

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have executed this Amendment as of the day and year first set forth above.

 

	
 
    	
“COMPANY”
    
	
 
    	
 
    
	
 
    	
CPI Card   Group-Colorado, Inc.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
President and Chief Executive   Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
“EMPLOYEE”
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ David Brush
    
	
 
    	
David Brush
    

 

[Signature Page to Amendment]

 

 

EXHIBIT A

 

GENERAL RELEASE OF CLAIMS

 

In consideration of the benefits to be provided to David Brush (the “Employee”) under the terms of the First Amendment, dated December 8, 2016, to the Employment and Non-Competition Agreement, effective June 22, 2015, by and between CPI Acquisition, Inc. and the Employee (the “Employment Agreement”), with respect to which this general release of claims (this “Agreement”) forms part, the Employee agrees as follows:

 

(a)                                 General Release by the Employee. The Employee individually and on behalf of his heirs, personal representatives, successors and assigns, hereby forever releases, waives and discharges CPI Card Group-Colorado, Inc. (the “Company”) and any parent, subsidiary or otherwise affiliated corporation, partnership, firm or business, and their respective present and former directors, officers, shareholders, owners, managers, supervisors, employees, partners, attorneys, agents and representatives, and their respective successors, heirs and assigns (jointly and severally referred to as “Releasees”), from any and all actions, causes of action, claims, charges, demands, losses, damages, costs, attorneys’ fees, judgments, liens, indebtedness and liabilities of every kind and character, if any, whether known or unknown, suspected or unsuspected, that the Employee may have or claim to have, in any way relating to and/or arising out of any event or act of omission or commission occurring prior to the Employee’s execution of this Agreement, or in any way relating to or arising out of the Employee’s employment with the Company and/or the Company’s conduct pursuant to this Agreement and/or any tort, statutory or contract claims the Employee may have against any of the Releasees, arising or existing prior to the date of this Agreement (collectively, “Claims”), including but not limited to:

 

(i)                                     Claims arising under federal, state, or local laws prohibiting age, sex, sexual orientation, marital status, race, color, creed, disability, handicap, religion, national origin, or any other form of discrimination lawful off-duty conduct, or retaliation, including, but not limited to, the 1866 Civil Rights Act, 42 U.S.C. § 1981, the Equal Pay Act, 29 U.S.C. § 206(d), the Americans With Disabilities Act, 42 U.S.C.  § 12101, and Title VII of the 1964 Civil Rights Act, as amended, 42 U.S.C. § 2000e et seq., the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621, et seq. (“ADEA”), including as amended by the Older Workers Benefit Protection Act of 1990, as amended (“OWPBA”), the Colorado Anti-Discrimination Act, as amended;

 

(ii)                                  Claims arising under the Fair Labor Standards Act, 29 U.S.C. § 201  et seq.;

 

(iii)                               Claims arising under the Family and Medical Leave Act, as amended;

 

(iv)                              Claims arising under the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq.;

 

(v)                                 Any and all common law claims such as wrongful discharge, violation of public policy, defamation, negligence, infliction of emotional distress, any intentional torts, outrageous conduct, interference with or breach of contract, fraud, misrepresentation, invasion of privacy, and retaliation, including retaliation and other common law claims;

 

(vi)                              Any and all claims for the following; money damages, including actual, compensatory, liquidated or punitive damages, equitable relief such as reinstatement or injunctive

 

A-1

 

relief, front or back pay, wages, benefits, sick pay, vacation pay, liquidated damages, costs, interest, expenses, attorneys’ fees, or any other remedies; and

 

(vii)                           All other legal and equitable claims regarding the Employee’s employment with the Company or the termination of said employment.

 

By signing this Agreement, the Employee represents that he has not filed any complaint, charge, or lawsuit against any or all of the Releasees, and has not raised any Claims with a court or government agency.  The Employee agrees that the Employee is not entitled to any remedy or relief if the Employee were to pursue with or before any federal, state or other governmental authority or court any Claim against any of the Releasees, relating to any of the matters released hereby.  If the release with respect to any of the foregoing released claims is deemed to be invalid, unenforceable or illegal, then the court making such determination shall reduce the effect of the release to be the minimum extent necessary in order to preserve the enforceability of the remainder of the release.

 

Nothing in this Agreement shall be construed to (A) limit the Employee’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”); (B) limit the Employee’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company; (C) release claims challenging the validity of this Agreement under the ADEA, as amended by the OWBPA; (D) release the Releasees or any of them from any Claim that by law cannot be waived or released; (E) release the Company from its obligations under this Agreement; or (F) release any existing rights that the Employee may have, if any, to indemnification pursuant to the Company’s by-laws and/or any directors’ and officers’ insurance policy of the Company, with respect to any charge, complaint or lawsuit relating to and arising during the Employee’s employment with the Company, including, without limitation, those certain shareholder class action lawsuits that were filed prior to the date hereof in the U.S. District Court for the Southern District of New York, as disclosed in the Company’s public filings. The Employee expressly waives and agrees to waive any right to recover monetary damages for personal injuries in any charge, complaint or lawsuit filed by the Employee or anyone else on behalf of the Employee for any released Claims. This Agreement does not limit the Employee’s right to receive an award for information provided to any Government Agencies.

 

The Company agrees not to contest any unemployment benefits to which the Employee may be entitled.

 

(b)                                 Release and Waiver of Rights under ADEA. The Employee recognizes and agrees that under the terms and provisions of this Agreement, he is releasing and waiving rights he may have to pursue any claims against the Company and/or Releasees arising under the ADEA.  In connection with his waiver of those rights, the Employee specifically acknowledges the following:

 

(i)                                     The Employee has been given a period of twenty-one (21) days to review and consider this Agreement before signing it.  The Employee further understands that he may use as much of the twenty-one (21) day period as he wishes prior to signing and is free to sign the Agreement before the expiration of the twenty-one (21) day period.  The Employee also understands that if he does not execute the Agreement within the twenty-one (21) day period, none of the parties hereto shall have any rights or obligations under this Agreement;

 

A-2

 

(ii)                                  The Employee was advised in writing that he has the right to and may consult with an attorney before executing this Agreement. The Employee has had the opportunity to consult with his attorneys about the Agreement and he has exercised his right to do so;

 

(iii)                               The Employee understands that he must knowingly and voluntarily accept the terms of this Agreement before signing the Agreement;

 

(iv)                              The Employee has seven (7) days following execution of this Agreement to revoke the Agreement.  The Agreement will not become effective or enforceable until the expiration of the seven (7) day revocation period.  To revoke the Agreement, the Employee must advise the Company in writing of his election to do so before the expiration of the seven (7) day revocation period and by addressing his notice of revocation to: Lisa Jacoba, CPI Card Group-Colorado, Inc., 10026 W. San Juan Way — Suite 200, Littleton, CO 80127. The effective date of this Agreement shall be the eighth (8th) day after the Employee has executed the Agreement, provided that he has not revoked the Agreement as described in this paragraph;

 

(v)                                 The Employee is specifically releasing, among other potential causes of action, any claims he may have against the Company arising under the ADEA and all amendments thereto;

 

(vi)                              The Employee is not waiving or relinquishing any rights or claims he may have against the Company that arise after the date this Agreement is executed;

 

(vii)                           The consideration given for this waiver and release is in addition to anything of value to which the Employee is already entitled; and

 

(viii)                        This Agreement is intended by the parties hereto to comply with the terms and provisions of the OWBPA and all amendments thereto.

 

(c)                                  Authority to Release. The Employee hereby warrants that he has not assigned or transferred to any person any portion of any Claim that is released, waived and discharged in Sections (a) or (b) above.

 

(d)                                 Severability. If any provision of this Agreement is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not affect the remaining provisions of this Agreement, which shall be fully severable, and given full force and effect.

 

(e)                                  Governing Law. This Agreement shall be governed and construed in accordance with the laws of Illinois without giving effect to its conflicts of law provisions.

 

(f)                                   Counterparts. This Agreement may be signed in counterparts, each of which shall be deemed an original and all of which together shall be one and the same instrument.  A signature hereon sent by facsimile or other electronic means shall be as effective as an original signature.

 

[Signature Page Follows]

 

A-3

 

PLEASE READ CAREFULLY. THIS
 AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.

 

	
 
    	
“COMPANY”
    
	
 
    	
 
    
	
 
    	
CPI Card   Group-Colorado, Inc.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
President and Chief Executive   Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
“EMPLOYEE”
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ David Brush
    
	
 
    	
Name:
    	
David Brush
    
	
 
    	
 
    	
 
    
	
 
    	
Date:
    	
December 8, 2016
    

 

A-4

 

EXHIBIT B

 

CONSULTING SERVICES AGREEMENT

 

THIS CONSULTING SERVICES AGREEMENT (this “Agreement”) is entered into as of January 1, 2017 (the “Effective Date”), by and between David Brush (the “Service Provider”) and CPI Card Group-Colorado, Inc. (the “Company”).

 

RECITALS

 

WHEREAS, the Service Provider has been employed by the Company as Chief Financial Officer pursuant to that certain Employment and Non-Competition Agreement, dated June 22, 2015, as amended December 8, 2016, by and between CPI Acquisition, Inc. and the Service Provider (the “Employment Agreement”);

 

WHEREAS, the Service Provider’s employment has terminated as of December 31, 2016 (the “Employment Separation Date”); and

 

WHEREAS, the Service Provider and the Company desire to have the Service Provider provide certain transition and consulting services to the Company as a consultant following the Employment Separation Date, as set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the promises and covenants contained herein, the Company and the Service Provider agree as follows:

 

AGREEMENT

 

1.                                      Consulting Period. The term of the consulting engagement pursuant to this Agreement shall begin on January 1, 2017 and shall end on June 30, 2017, unless earlier terminated pursuant to Section 6 of this Agreement (the “Consulting Period”).

 

2.                                      Consulting and Transition Services.

 

(a)                                 During the Consulting Period, the Service Provider agrees to provide transition, consulting and other related services to the Company, as may be requested from time to time by, and at the direction of, the Company’s Chief Executive Officer (the “CEO”), Chief Human Resources Officer and/or the Board of Directors (the “Board”), including, but not limited to, cooperating with the Company on ongoing matters (collectively, the “Consulting and Transition Services”). As part of the Consulting and Transition Services, the Service Provider further agrees to assist the Company in providing an effective transition of the Service Provider’s executive responsibilities. The Service Provider shall diligently and competently perform the Consulting and Transition Services requested hereunder and use reasonable efforts in connection with the performance of such Consulting and Transition Services.

 

(b)                                 The Service Provider agrees to make himself reasonably available during the Consulting Period as requested with reasonable advance notice (subject to the Service Provider’s unavailability due to customary vacations, etc., taken during the Consulting Period) by the CEO, Chief Human Resources Officer and/or the Board and to develop a mutually acceptable work schedule during the Consulting Period. During the Consulting Period, the Service Provider is expected to provide the Consulting and Transition Services for no more than three (3) business days per month, and the Company will compensate the Service Provider at a rate of $200 per hour for any additional time spent beyond three (3)

 

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business days per month performing any Consulting and Transition Services requested by the Company that the Service Provider agrees to perform.

 

3.                                      Compensation.

 

(a)                                 Consulting Fee. As compensation for the Consulting and Transition Services, the Company will pay the Service Provider during the Consulting Period a monthly fee of $5,000, payable in one installment per month without interest (the “Consulting Fee”). The Consulting Fee, together with any documented additional hourly amounts due under Section 2(b), will be payable to the Service Provider on the first (1st) business day of each month during the Consulting Period.

 

(b)                                 Treatment of Existing Equity Awards. For the avoidance of doubt, the provision of the Consulting and Transition Services by the Service Provider during the Consulting Period will constitute “Service” for purposes of the Service Provider’s time-vesting equity or long-term incentive awards granted under the Company’s Omnibus Incentive Plan (collectively, the “LTI Awards”) that remain outstanding as of the Effective Date (as “Service” is defined in the award agreements governing such LTI Awards). The Service Provider’s LTI Award consisting of 23,388 restricted stock units (the “RSUs”) is scheduled to vest on March 2, 2017 and shall vest on such date, provided that the Service Provider continues to provide the Consulting and Transition Services through such date. In addition, notwithstanding anything in the award agreement relating thereto or in the Employment Agreement to the contrary, the Service Provider’s restricted shares of common stock of CPI Holdings I, Inc. (the “Restricted Shares”) shall remain outstanding and shall continue to vest through the end of the Consulting Period, provided that the Service Provider continues to provide the Consulting and Transition Services. Any Restricted Shares that are unvested as of the end of the Consulting Period shall be forfeited.

 

(c)                                  COBRA. To the extent that the Service Provider is participating in the Company’s group health insurance program immediately prior to the Employment Separation Date, and provided that the Service Provider timely elects and remains eligible for coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, the Company will pay to the Service Provider a cash amount per month, equal to the sum of (i) the portion of the premiums for such coverage that the Company was paying on behalf of the Service Provider immediately prior to the Employment Separation Date and (ii) the income taxes related thereto, through the earlier of (A) the termination of the Consulting Period or (B) the date on which the Service Provider begins receiving coverage under another group health plan. Such payment shall be fully taxable to the Service Provider and will be treated consistently with other cash payments under this Agreement. Notwithstanding the foregoing, this Section 3(c) shall cease to apply as of the effective date of any regulation or other guidance under which payment of such amount would be deemed to violate any nondiscrimination requirements under the Patient Protection and Affordable Care Act.

 

(d)                                 Expense Reimbursement. The Company will reimburse the Service Provider for reasonable and necessary business expenses incurred in the course of performing the Consulting and Transition Services hereunder in accordance with the Company’s travel policy and business expense policies and procedures as in effect from time to time. The Company will also reimburse the Service Provider for the cost of early termination of the Service Provider’s apartment lease agreement.

 

4.                                      Administrative Support. The Company agrees to provide the Service Provider with appropriate office space and administrative support at the Company’s headquarters while he is performing the Consulting and Transition Services for the Company. During the Consulting Period, the Company agrees to provide the Service Provider with reasonable technical support and the Company’s help desk will be available to provide technical assistance to the Service Provider as reasonably requested.

 

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5.                                      Relationship; Indemnification. It is the intent of the parties to this Agreement, and the Company has determined, that during the Consulting Period, the Service Provider shall be an independent contractor and not an employee of the Company, and nothing in this Agreement shall be construed to create an employment relationship between the Service Provider and the Company following the Employment Separation Date. As an independent contractor, the Service Provider shall not participate in any employee benefit plan or program or be subject to any employment rules, regulations or policies of the Company.  No amount will be deducted or withheld from the Company’s payments to the Service Provider under this Agreement for federal, state or local taxes and no FICA taxes will be payable by the Company on behalf of the Service Provider. The Service Provider will be solely responsible for making appropriate filings and payments to the appropriate governmental taxing authorities, including payments of all income taxes and self-employment taxes due on compensation received hereunder. The Service Provider is entitled to indemnification pursuant to Section 7.1 of the Company’s by-laws with respect to the Consulting and Transition Services performed under this Agreement.

 

6.                                      Termination of Consulting Period. Notwithstanding anything in this Agreement to the contrary, the Company or the Service Provider may terminate the Consulting Period for any reason and at any time.

 

(a)                                 In the event of an early termination of the Consulting Period by the Company for Cause (as defined in Section 6.1(c) of the Employment Agreement) or by the Service Provider for any reason, the Company’s obligation to pay any future installments of the Consulting Fee shall cease immediately as of the date of such termination of the Consulting Period and the Service Provider will immediately cease vesting in the equity awards described in Section 3(b) above.

 

(b)                                 In the event of an early termination of the Consulting Period by the Company without Cause, the Company will continue to pay the Service Provider the applicable remaining installments of the Consulting Fee through June 30, 2017, and the Service Provider will continue to vest as scheduled in the RSUs, the Restricted Shares and any other LTI Awards through June 30, 2017.

 

(c)                                  Following the termination of the Consulting Period for any reason, the Service Provider shall not remove from any premises at which the business of the Company is conducted any property of the Company, including, without limitation, any Confidential Information (as such term is defined in Section 1.5 of the Employment Agreement), and shall return, in good condition, all the property of the Company, including, without limitation, all tangible embodiments of the Confidential Information.

 

7.                                      Release of Claims. Notwithstanding anything herein to the contrary, the Company’s agreement to engage the Service Provider as a consultant hereunder following the Employment Separation Date is contingent upon the Service Provider’s timely execution and non-revocation of this Agreement, including the general release of claims set forth in this Section 7.

 

(a)                                 General Release by the Service Provider. The Service Provider individually and on behalf of his heirs, personal representatives, successors and assigns, hereby forever releases, waives and discharges the Company and any parent, subsidiary or otherwise affiliated corporation, partnership, firm or business, and their respective present and former directors, officers, shareholders, owners, managers, supervisors, employees, partners, attorneys, agents and representatives, and their respective successors, heirs and assigns (jointly and severally referred to as “Releasees”), from any and all actions, causes of action, claims, charges, demands, losses, damages, costs, attorneys’ fees, judgments, liens, indebtedness and liabilities of every kind and character, if any, whether known or unknown, suspected or unsuspected, that the Service Provider may have or claim to have, in any way relating to and/or arising out of any event or act of omission or commission occurring prior to the Service Provider’s execution of this Agreement, or in any way relating to or arising out of the Service Provider’s employment with the Company and/or the

 

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Company’s conduct pursuant to this Agreement and/or any tort, statutory or contract claims the Service Provider may have against any of the Releasees, arising or existing prior to the date of this Agreement (collectively, “Claims”), including but not limited to:

 

(i)                                     Claims arising under federal, state, or local laws prohibiting age, sex, sexual orientation, marital status, race, color, creed, disability, handicap, religion, national origin, or any other form of discrimination lawful off-duty conduct, or retaliation, including, but not limited to, the 1866 Civil Rights Act, 42 U.S.C. § 1981, the Equal Pay Act, 29 U.S.C. § 206(d), the Americans With Disabilities Act, 42 U.S.C.  § 12101, and Title VII of the 1964 Civil Rights Act, as amended, 42 U.S.C. § 2000e et seq., the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. § 621, et seq. (“ADEA”), including as amended by the Older Workers Benefit Protection Act of 1990, as amended (“OWPBA”), the Colorado Anti-Discrimination Act, as amended;

 

(ii)                                  Claims arising under the Fair Labor Standards Act, 29 U.S.C. § 201  et seq.;

 

(iii)                               Claims arising under the Family and Medical Leave Act, as amended;

 

(iv)                              Claims arising under the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq.;

 

(v)                                 Any and all common law claims such as wrongful discharge, violation of public policy, defamation, negligence, infliction of emotional distress, any intentional torts, outrageous conduct, interference with or breach of contract, fraud, misrepresentation, invasion of privacy, and retaliation, including retaliation and other common law claims;

 

(vi)                              Any and all claims for the following; money damages, including actual, compensatory, liquidated or punitive damages, equitable relief such as reinstatement or injunctive relief, front or back pay, wages, benefits, sick pay, vacation pay, liquidated damages, costs, interest, expenses, attorneys’ fees, or any other remedies; and

 

(vii)                           All other legal and equitable claims regarding the Service Provider’s employment with the Company or the termination of said employment.

 

By signing this Agreement, the Service Provider represents that he has not filed any complaint, charge, or lawsuit against any or all of the Releasees, and has not raised any Claims with a court or government agency.  The Service Provider agrees that the Service Provider is not entitled to any remedy or relief if the Service Provider were to pursue with or before any federal, state or other governmental authority or court any Claim against any of the Releasees, relating to any of the matters released hereby.  If the release with respect to any of the foregoing released claims is deemed to be invalid, unenforceable or illegal, then the court making such determination shall reduce the effect of the release to be the minimum extent necessary in order to preserve the enforceability of the remainder of the release.

 

Nothing in this Agreement shall be construed to (A) limit the Service Provider’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”); (B) limit the Service Provider’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company; (C) release claims

 

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challenging the validity of this Agreement under the ADEA, as amended by the OWBPA; (D) release the Releasees or any of them from any Claim that by law cannot be waived or released; (E) release the Company from its obligations under this Agreement; or (F) release any existing rights that the Service Provider may have, if any, to indemnification pursuant to the Company’s by-laws and/or any directors’ and officers’ insurance policy of the Company, with respect to any charge, complaint or lawsuit relating to and arising during the Service Provider’s employment with the Company, including, without limitation, those certain shareholder class action lawsuits that were filed prior to the date hereof in the U.S. District Court for the Southern District of New York, as disclosed in the Company’s public filings. The Service Provider expressly waives and agrees to waive any right to recover monetary damages for personal injuries in any charge, complaint or lawsuit filed by the Service Provider or anyone else on behalf of the Service Provider for any released Claims. This Agreement does not limit the Service Provider’s right to receive an award for information provided to any Government Agencies.

 

The Company agrees not to contest any unemployment benefits to which the Service Provider may be entitled.

 

(b)                                 Release and Waiver of Rights under ADEA. The Service Provider recognizes and agrees that under the terms and provisions of this Agreement, he is releasing and waiving rights he may have to pursue any claims against the Company and/or Releasees arising under the ADEA.  In connection with his waiver of those rights, the Service Provider specifically acknowledges the following:

 

(i)                                     The Service Provider has been given a period of twenty-one (21) days to review and consider this Agreement before signing it.  The Service Provider further understands that he may use as much of the twenty-one (21) day period as he wishes prior to signing and is free to sign the Agreement before the expiration of the twenty-one (21) day period.  The Service Provider also understands that if he does not execute the Agreement within the twenty-one (21) day period, none of the parties hereto shall have any rights or obligations under this Agreement;

 

(ii)                                  The Service Provider was advised in writing that he has the right to and may consult with an attorney before executing this Agreement. The Service Provider has had the opportunity to consult with his attorneys about the Agreement and he has exercised his right to do so;

 

(iii)                               The Service Provider understands that he must knowingly and voluntarily accept the terms of this Agreement before signing the Agreement;

 

(iv)                              The Service Provider has seven (7) days following execution of this Agreement to revoke the Agreement.  The Agreement will not become effective or enforceable until the expiration of the seven (7) day revocation period.  To revoke the Agreement, the Service Provider must advise the Company in writing of his election to do so before the expiration of the seven (7) day revocation period and by addressing his notice of revocation to: Lisa Jacoba, CPI Card Group-Colorado, Inc., 10026 W. San Juan Way — Suite 200, Littleton, CO 80127.  The effective date of this Agreement shall be the eighth (8th) day after the Service Provider has executed the Agreement, provided that he has not revoked the Agreement as described in this paragraph;

 

(v)                                 The Service Provider is specifically releasing, among other potential causes of action, any claims he may have against the Company arising under the ADEA and all amendments thereto;

 

(vi)                              The Service Provider is not waiving or relinquishing any rights or claims he may have against the Company that arise after the date this Agreement is executed;

 

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(vii)                           The consideration given for this waiver and release is in addition to anything of value to which the Service Provider is already entitled; and

 

(viii)                        This Agreement is intended by the parties hereto to comply with the terms and provisions of the OWBPA and all amendments thereto.

 

(c)                                  Authority to Release. The Service Provider hereby warrants that he has not assigned or transferred to any person any portion of any Claim that is released, waived and discharged in Sections 7(a) or 7(b) above.

 

8.                                      Future Cooperation.  In connection with any and all claims, disputes, negotiations, investigation, lawsuits or administrative proceedings involving the Company, the Service Provider agrees to make himself available, upon reasonable advance notice from the Company, and without the necessity of subpoena, to provide information or documents, provide declarations or statements to the Company, meet with attorneys or other representatives of the Company, prepare for and give depositions or testimony, and/or otherwise cooperate in the investigation, defense or prosecution of any or all such matters. The Company will reimburse the Service Provider for all reasonable expenses incurred in providing such assistance and will pay to the Service Provider a fee of $200 per hour for providing the cooperation described in this Section 8. Any amounts payable pursuant to this Section 8 shall be paid promptly upon the Company’s receipt of a written request from the Service Provider, but in all cases, such amounts shall be paid no later than March 15 of the year following the year in which the expense is incurred. Notwithstanding anything in this agreement to the contrary, the Service Provider and the Company agree that the obligations imposed upon him under this Section 8 shall survive the termination of the Consulting Period.

 

9.                                      Non-Disparagement. The Service Provider agrees not to engage in any form of conduct, or make any statements or representations that disparage or otherwise impair the reputation, goodwill or commercial interests of the Company and its affiliates.

 

10.                               Confidentiality of Agreement. The Service Provider agrees to keep this Agreement confidential and will not communicate the terms of this Agreement, the facts or circumstances giving rise to this Agreement, or the fact that such Agreement exists, to any third party except, as necessary, his immediate family, accountants, legal or financial advisors or otherwise appropriate or necessary as required by law or court order.

 

11.                               Miscellaneous.

 

(a)                                 Amendment. This Agreement may be amended only by a writing executed by the parties to this Agreement.

 

(b)                                 Entire Agreement. This Agreement and the applicable LTI Award agreements set forth the entire agreement and understanding of the parties hereto and supersede any and all other agreements, either oral or in writing, between the Company, any of its shareholders, members, and/or principals and the Service Provider related to the subject matter addressed herein, including, but not limited to, the Employment Agreement; provided, that Sections 3, 4, and 5 of the Employment Agreement, and any definitions associated therewith, shall remain in full force and effect following the Effective Date.

 

(c)                                  Notices. All notices and other communications required or permitted under this Agreement will be in writing and will be deemed to have been duly given when delivered in person or when dispatched by telegram or electronic facsimile transfer (confirmed in writing by mail simultaneously

 

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dispatched) or one (1) business day after having been dispatched by a nationally recognized overnight courier service to the appropriate party at the address specified below:

 

	
If to the Company:
    	
 
    	
CPI Card Group-Colorado, Inc.
    
	
 
    	
 
    	
10026 W. San Juan Way — Suite 200
    
	
 
    	
 
    	
Littleton, CO 80127
    
	
 
    	
 
    	
Fax: (303) 973-8420
    
	
 
    	
 
    	
Attention: Lisa Jacoba
    
	
 
    	
 
    	
 
    
	
With copies to:
    	
 
    	
Winston & Strawn LLP
    
	
 
    	
 
    	
35 W. Wacker Drive
    
	
 
    	
 
    	
Chicago, IL 60601
    
	
 
    	
 
    	
Fax: (312) 558-5700
    
	
 
    	
 
    	
Attention: Andrew McDonough
    
	
 
    	
 
    	
 
    
	
If to the Service Provider:
    	
 
    	
David Brush
    
	
 
    	
 
    	
777 Washington Road
    
	
 
    	
 
    	
Lake Forest, IL 60045
    

 

(d)                                 Governing Law. This Agreement shall be governed and construed in accordance with the laws of Illinois without giving effect to its conflicts of law provisions.

 

(e)                                  Section 409A. This Agreement is intended to comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and shall be administered, construed and interpreted in accordance with, Code Section 409A and the interpretive guidance thereunder.

 

(f)                                   Compliance with Law. This Agreement and the payments contemplated hereunder are subject to compliance with all applicable laws, regulations, rulings and other legal requirements including the Dodd-Frank Wall Street Reform and Consumer Protection Act, as applicable.

 

(g)                                  Severability. If any provision of this Agreement is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not affect the remaining provisions of this Agreement, which shall be fully severable, and given full force and effect.

 

(h)                                 Waivers. The failure of either party to insist upon strict compliance by the other party with any of the covenants or restrictions contained in this Agreement shall not be construed as a waiver, nor shall any course of action deprive either party of the right to require strict compliance with this Agreement.

 

(i)                                     Headings. Section, paragraph and other captions or headings contained in this Agreement are inserted as a matter of convenience and for reference, and in no way define, limit, extend or otherwise describe the scope or intent of this Agreement or any provision hereof and shall not affect in any way the meaning or interpretation of this Agreement.

 

(j)                                    Counterparts. This Agreement may be signed in counterparts, each of which shall be deemed an original and all of which together shall be one and the same instrument.  A signature hereon sent by facsimile or other electronic means shall be as effective as an original signature.

 

[Signature Page Follows]

 

B-7

 

IN WITNESS WHEREOF, and intending to be legally bound, the parties have executed this Agreement on the date first set forth above in Littleton, Colorado. The Service Provider acknowledges that he has received a signed original copy of this Agreement.

 

CAUTION: PLEASE READ CAREFULLY. 
 THIS AGREEMENT INCLUDES A RELEASE OF 
 ALL KNOWN AND UNKNOWN CLAIMS.

 

 

	
 
    	
“COMPANY”
    
	
 
    	
 
    
	
 
    	
CPI Card   Group-Colorado, Inc.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Steven Montross
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
President and Chief Executive   Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
“SERVICE PROVIDER”
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ David Brush
    
	
 
    	
David Brush
    

 

B-8

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