Document:

Exhibit 4.6

 

ASSUMPTION AGREEMENT

 

ASSUMPTION AGREEMENT, dated as of December 20, 2011, made by SALLY BEAUTY HOLDINGS, INC., a Delaware corporation (the “Additional Granting Party”), in favor of MERRILL LYNCH CAPITAL CORPORATION, as collateral agent (in such capacity, the “Collateral Agent”) and as administrative agent (in such capacity, the “Administrative Agent”) for the banks and other financial institutions from time to time parties to the Credit Agreement referred to below and the other Secured Parties (as defined in the Guarantee and Collateral Agreement).  All capitalized terms not defined herein shall have the meaning ascribed to them in such the Guarantee and Collateral Agreement referred to below, or if not defined therein, in the Credit Agreement.

 

W  I  T  N  E  S  S  E  T  H :

 

WHEREAS, SALLY INVESTMENT HOLDINGS LLC, a Delaware limited liability company (“Holdings”), SALLY HOLDINGS LLC (the “Borrower”), MERRILL LYNCH CAPITAL CORPORATION, as administrative agent and collateral agent, and the other parties party thereto are parties to a Credit Agreement, dated as of November 16, 2006 (as amended, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”);

 

WHEREAS, in connection with the Credit Agreement, Holdings, the Borrower and certain of its Subsidiaries are, or are to become, parties to the Guarantee and Collateral Agreement, dated as of November 16, 2006 (as amended, supplemented, waived or otherwise modified from time to time, the “Guarantee and Collateral Agreement”), in favor of the Collateral Agent, for the ratable benefit of the Secured Parties; and

 

WHEREAS, the Additional Granting Party is a direct parent of Holdings and derives not insubstantial benefits from the credit accommodations provided by the Lenders to the Borrower and to the other Loan Parties;

 

WHEREAS, the Additional Granting Party, while not required to do so, has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guarantee and Collateral Agreement;

 

NOW, THEREFORE, IT IS AGREED:

 

1.  Guarantee and Collateral Agreement.  By executing and delivering this Assumption Agreement, the Additional Granting Party hereby becomes a party to the Guarantee and Collateral Agreement as a Granting Party thereunder with the same force and effect as if originally named therein as a Guarantor, Grantor and Pledgor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Guarantor, Grantor and Pledgor thereunder.  The information set forth in Annex 1-A hereto is hereby added to the information set forth in Schedules 1 through 7 to the Guarantee and Collateral Agreement, and such Schedules are hereby amended and modified to include such information.  The Additional Granting Party hereby represents and warrants that each of the representations and warranties of

 

 

such Additional Granting Party, in its capacities as a Guarantor, Grantor and Pledgor, contained in Section 4 of the Guarantee and Collateral Agreement is true and correct in all material respects on and as the date hereof (after giving effect to this Assumption Agreement) as if made on and as of such date.

 

2.  Credit Agreement.  For the avoidance of doubt and notwithstanding the Additional Granting Party becoming a Guarantor, Grantor and Pledgor under the the Guarantee and Collateral Agreement, the Additional Granting Party shall not become or be deemed to be a “Loan Party” or a “Guarantor” under the Credit Agreement for any purpose whatsoever.

 

3.  GOVERNING LAW.  THIS ASSUMPTION AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND ANY CLAIM OR CONTROVERSY RELATING HERETO SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 

IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written.

 

	
 
    	
SALLY   BEAUTY HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Flaherty
    
	
 
    	
 
    	
Name:   Mark Flaherty
    
	
 
    	
 
    	
Title:   SVP & CFO
    
	
 
    	
 
    
	
 
    	
 
    
	
Acknowledged   and Agreed to as
    	
 
    
	
of   the date hereof by:
    	
 
    
	
 
    	
 
    
	
MERRILL   LYNCH CAPITAL CORPORATION,
    	
 
    
	
as   Collateral Agent and Administrative Agent
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Darleen R. Parmelee
    	
 
    
	
 
    	
Name:   Darleen R. Parmelee
    	
 
    
	
 
    	
Title:   Assistant Vice President
    	
 
    

 

 

Annex 1-A to

Assumption Agreement

 

Supplement to

Guarantee and Collateral Agreement

Schedule 1

 

Supplement to

Guarantee and Collateral Agreement

Schedule 2

 

Supplement to

Guarantee and Collateral Agreement

Schedule 3

 

Supplement to

Guarantee and Collateral Agreement

Schedule 4

 

Supplement to

Guarantee and Collateral Agreement

Schedule 5

 

Supplement to

Guarantee and Collateral Agreement

Schedule 6

 

Supplement to

Guarantee and Collateral Agreement

Schedule 7Exhibit 4.10

 

JOINDER TO LOAN DOCUMENTS

 

This Joinder to Loan Documents (this “Joinder”) is made as of  December 20, 2011 by and among:

 

SALLY HOLDINGS LLC, a Delaware limited liability company, BEAUTY SYSTEMS GROUP, LLC, a Delaware limited liability company, and SALLY BEAUTY SUPPLY, LLC, a Delaware limited liability company (collectively, the “Domestic Borrowers”);

 

BEAUTY SYSTEMS GROUP (CANADA), INC., a New Brunswick corporation (the “Canadian Borrower”),

 

SBH FINANCE B.V., a private limited liability company, incorporated under the laws of the Netherlands (the “Foreign Borrower” and, collectively with the Domestic Borrowers and the Canadian Borrower, the “Existing Borrowers”);

 

The GUARANTORS party to the Credit Agreement set forth on Schedule II annexed hereto (collectively, the “Existing Guarantors” and, together with the Existing Borrowers, the “Existing Loan Parties”);

 

SALLY BEAUTY HOLDINGS, INC.,  a Delaware corporation, and SALLY INVESTMENT HOLDINGS LLC, a Delaware limited liability company, each having an office at 3001 Colorado Boulevard, Denton, Texas 76210 (collectively, the  “New Guarantors”, and each individually, a “New Guarantor”); and

 

BANK OF AMERICA, N.A., a national banking association, having a place of business at 100 Federal Street, 9th Floor, Boston, Massachusetts 02110, as administrative agent (in such capacity, the “Administrative Agent”) for its own benefit and the benefit of the other Credit Parties (as defined in the Credit Agreement referred to below) and as collateral agent (in such capacity, the “Collateral Agent”), for its own benefit and for the benefit of the other Credit Parties (as defined in the Credit Agreement referred to below) to the Credit Agreement (as defined below);

 

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

 

W I T N E S S E T H :

 

A.            Reference is made to a certain Credit Agreement dated as of November 12, 2010 (as amended, modified, supplemented or restated and in effect from time to time, the “Credit Agreement”), by, among others, (i) the Existing Borrowers, (ii) the Existing Guarantors, (iii) the Administrative Agent, (iv) the Collateral Agent, and (v) the Lenders party thereto (the “Lenders”).  All capitalized terms used herein, and not otherwise defined herein, shall have the meanings assigned to such terms in the Credit Agreement.

 

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B.            The Existing Loan Parties have informed the Administrative Agent that they wish to cause each New Guarantor to become a party to, and bound by the terms of, the Credit Agreement and the other Loan Documents, in the same capacity and to the same extent as the Existing Guarantors thereunder.  Each undersigned New Guarantor is executing this Joinder in accordance with the requirements of the Credit Agreement to become a Guarantor thereunder.

 

C.            Each Guarantor, including the New Guarantors, acknowledges that it is an integral part of a consolidated enterprise and that it will receive direct and indirect benefits from the availability of the credit facility provided for in the Credit Agreement, from the making of the Loans by the Lenders, and the issuance of the Letters of Credit by the L/C Issuer.  In order for the New Guarantors to become party to the Credit Agreement and certain of the other Loan Documents as provided herein, the New Guarantors and the Existing Loan Parties are required to execute this Joinder.

 

NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

1.                                       Definitions.  All capitalized terms used herein and not otherwise defined shall have the same meaning herein as in the Credit Agreement.

 

2.                                       Joinder and Assumption of Obligations.  Effective as of the date of this Joinder:

 

a.                                       Each New Guarantor hereby:

 

i.                                          Joins in the execution of, and becomes a party to, the Credit Agreement, the Facility Guaranty, the Security Documents and each of the other Loan Documents to which the Existing Guarantors are a party.

 

ii.                                       Assumes and agrees to perform all applicable duties and Obligations of a Loan Party under the Credit Agreement, the Facility Guaranty, the Security Documents and each of the other Loan Documents to which the Existing Guarantors are a party.

 

b.                                      Without in any manner limiting the generality of clause (a) above, each New Guarantor hereby covenants and agrees that:

 

i.                                          New Guarantor shall be bound by all covenants (other than covenants which specifically relate solely to an earlier date), agreements, liabilities and acknowledgments of a Guarantor under the Credit Agreement, the Facility Guaranty, the Security Documents and each of the other Loan Documents to which the Existing Guarantors are a party, in each case, with the same force and effect as if such New Guarantor was a signatory thereto and was expressly named therein;

 

ii.                                       To secure the payment and performance of all of the Secured Obligations and all renewals, extensions, restructurings and refinancings thereof, New Guarantor hereby pledges and grants, subject to existing licenses to use the Intellectual

 

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Property Collateral granted by such Grantor in the ordinary course of business, to the Collateral Agent for its benefit and for the benefit of the other Domestic Credit Parties, a lien on and security interest in and to all of the right, title and interest of such Grantor in, to and under the Collateral; and

 

iii.                                    Each New Guarantor authorizes the Administrative Agent to prepare and file such UCC financing statements as the Administrative Agent may deem appropriate in order to perfect the security interests to be granted pursuant to the Credit Agreement and certain related Loan Documents.  Without limiting the foregoing, such filings may describe the collateral covered thereby as “All assets of the Debtor, wherever located, whether now owned or hereafter acquired or arising” (or words of similar effect).

 

3.                                       Representations and Warranties.  Each New Guarantor hereby makes all representations, warranties, and covenants set forth in the Credit Agreement, the Facility Guaranty, the Security Documents and each of the other Loan Documents as of the date hereof (other than representations, warranties and covenants that relate solely to an earlier date).  To the extent that any changes in any representations, warranties, and covenants require any amendments to the Schedules to the Credit Agreement or any of the other Loan Documents, such Schedules are hereby updated, as evidenced by any supplemental Schedules (if any) annexed to this Joinder.

 

4.                                       Ratification of Loan Documents.  Except as specifically amended by this Joinder and the other documents executed and delivered in connection herewith, all of the terms and conditions of the Credit Agreement and of the other Loan Documents shall remain in full force and effect as in effect prior to the date hereof, without releasing any Loan Party thereunder or Collateral granted by any Loan Party.

 

5.                                       Conditions Precedent to Effectiveness.  This Joinder shall not be effective until the following conditions precedent have each been fulfilled to the reasonable satisfaction of the Administrative Agent:

 

a.                                       This Joinder shall have been duly executed and delivered by the respective parties hereto, and shall be in full force and effect and shall be in form and substance reasonably satisfactory to the Administrative Agent.

 

b.                                      All action on the part of the New Guarantors and the other Loan Parties necessary for the valid execution, delivery and performance by the New Guarantors of this Joinder and all other documentation, instruments, and agreements required to be executed in connection herewith shall have been duly and effectively taken and evidence thereof reasonably satisfactory to the Administrative Agent shall have been provided to the Administrative Agent.

 

c.                                       Each New Guarantor shall each have delivered the following to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent:

 

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i.                                          Certificate of Legal Existence and Good Standing issued by the Secretary of the State of its incorporation or organization.

 

ii.                                       A certificate of an authorized officer of the due adoption, continued effectiveness, and setting forth the text, of each corporate resolution adopted in connection with the assumption of obligations under the Credit Agreement and the other Loan Documents, and attesting to the true signatures of each Person authorized as a signatory to any of the Loan Documents, together with true and accurate copies of all Charter Documents.

 

iii.                                    Execution and delivery by each New Guarantor of such other documents, agreements and certificates as the Administrative Agent and the Collateral Agent may reasonably require, including, but not limited to, a perfection certificate.

 

d.                                      The Administrative Agent shall have received all documents and instruments required by law or requested by the Administrative Agent or the Collateral Agent to create or perfect the first priority Lien (subject only to Permitted Encumbrances having priority by operation of applicable Law) intended to be created under the Loan Documents and all such documents and instruments shall have been so filed, registered or recorded or other arrangements reasonably satisfactory to the Administrative Agent.

 

e.                                       The Loan Parties shall have executed and delivered to the Administrative Agent such additional documents, instruments, and agreements related to this Joinder and the transactions contemplated hereunder as the Administrative Agent may reasonably request.

 

6.                                       Miscellaneous.

 

a.                                       This Joinder may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument.

 

b.                                      This Joinder expresses the entire understanding of the parties with respect to the transactions contemplated hereby.  No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof.

 

c.                                       Any determination that any provision of this Joinder or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality or enforceability of any other provisions of this Joinder.

 

d.                                      The Loan Parties shall pay all Credit Party Expenses of the Administrative Agent and the Secured Parties, including, without limitation, all such Credit Party Expenses incurred in connection with the preparation, negotiation, execution and delivery of this Joinder in accordance with the terms of the Credit Agreement.

 

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e.                                       THIS JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT WITHOUT GIVING EFFECT TO THE OTHER CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

[SIGNATURE PAGES FOLLOW]

 

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                IN WITNESS WHEREOF, each of the undersigned has caused this Joinder to be duly executed and delivered by its proper and duly authorized officer as of the date set forth below.

 

 

	
 
    	
NEW   GUARANTORS
    
	
 
    	
 
    
	
 
    	
SALLY   BEAUTY HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Flaherty
    
	
 
    	
 
    	
Name:
    	
Mark   Flaherty
    
	
 
    	
 
    	
Title:
    	
SVP &   CFO
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SALLY   INVESTMENT HOLDINGS LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Flaherty
    
	
 
    	
 
    	
Name:
    	
Mark   Flaherty
    
	
 
    	
 
    	
Title:
    	
SVP &   CFO
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ADMINISTRATIVE   AGENT:
    
	
 
    	
 
    
	
 
    	
BANK OF AMERICA, N.A.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Matthew Potter
    
	
 
    	
 
    	
Name:
    	
Matthew   Potter
    
	
 
    	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
COLLATERAL   AGENT:
    
	
 
    	
 
    
	
 
    	
BANK OF AMERICA, N.A.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Matthew Potter
    
	
 
    	
 
    	
Name:
    	
Matthew   Potter
    
	
 
    	
 
    	
Title:
    	
Vice   President
    

 

Signature Page to Joinder to Loan Documents

 

 

	
Acknowledged   and Agreed:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
THE   ENTITIES LISTED ON SCHEDULE I HERETO,
    	
 
    
	
as   Existing Borrowers
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Flaherty
    	
 
    
	
 
    	
Name:
    	
Mark   Flaherty
    	
 
    
	
 
    	
Title:
    	
SVP &   CFO
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
THE   ENTITIES LISTED ON SCHEDULE II HERETO,
    	
 
    
	
as   Existing Guarantors
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark Flaherty
    	
 
    
	
 
    	
Name:
    	
Mark   Flaherty
    	
 
    
	
 
    	
Title:
    	
SVP &   CFO
    	
 
    

 

Signature Page to Joinder to Loan Documents

 

 

SCHEDULE I

 

Existing Borrowers

 

SALLY HOLDING LLC

BEAUTY SYSTEMS GROUP LLC

SALLY BEAUTY SUPPLY LLC

BEAUTY SYSTEMS GROUP (CANADA), INC.

SBH FINANCE BV

 

Schedule I to Joinder to Loan Documents

 

 

SCHEDULE II

 

Existing Guarantors

 

	
Name of Loan Party
    	
 
    	
Type of Loan Party
    
	
Aerial   Company, Inc.
    	
 
    	
Guarantor
    
	
Armstrong   McCall Holdings, Inc.
    	
 
    	
Guarantor
    
	
Armstrong   McCall Management, L.C.
    	
 
    	
Guarantor
    
	
Armstrong   McCall Holdings, L.L.C.
    	
 
    	
Guarantor
    
	
Armstrong   McCall, L.P.
    	
 
    	
Guarantor
    
	
Arnold’s, Inc.
    	
 
    	
Guarantor
    
	
Beauty   Holding LLC
    	
 
    	
Guarantor
    
	
Beauty   Systems Group (Canada), Inc.
    	
 
    	
Foreign   Guarantor 
    
	
 
    	
 
    	
Canadian   Guarantor
    
	
Beyond   the Zone, Inc.
    	
 
    	
Guarantor
    
	
Brentwood   Beauty Laboratories International, Inc.
    	
 
    	
Guarantor
    
	
Coloresse, Inc.
    	
 
    	
Guarantor
    
	
Design   Lengths, Inc.
    	
 
    	
Guarantor
    
	
Diorama   Services Company, LLC
    	
 
    	
Guarantor
    
	
Energy   of Beauty, Inc.
    	
 
    	
Guarantor
    
	
Esthetician   Services, Inc.
    	
 
    	
Guarantor
    
	
Femme   Couture International, Inc.
    	
 
    	
Guarantor
    
	
For   Perms Only, Inc.
    	
 
    	
Guarantor
    
	
Generic   Value Products, Inc.
    	
 
    	
Guarantor
    
	
High   Intensity Products, Inc.
    	
 
    	
Guarantor
    
	
Innovations   — Successful Salon Services
    	
 
    	
Guarantor
    
	
Ion   Professional Products, Inc.
    	
 
    	
Guarantor
    
	
Land   of Dreams, Inc.
    	
 
    	
Guarantor
    
	
Miracle   Lane, Inc.
    	
 
    	
Guarantor
    
	
Nail   Life, Inc.
    	
 
    	
Guarantor
    
	
Neka   Salon Supply, Inc.
    	
 
    	
Guarantor
    
	
New   Image Professional Products, Inc.
    	
 
    	
Guarantor
    
	
Power   IQ, Inc.
    	
 
    	
Guarantor
    
	
Procare   Laboratories, Inc.
    	
 
    	
Guarantor
    
	
Sally   Beauty Distribution of Ohio, Inc.
    	
 
    	
Guarantor
    
	
Sally   Beauty Distribution LLC
    	
 
    	
Guarantor
    
	
Sally   Beauty International Finance LLC
    	
 
    	
Guarantor
    
	
Sally   Capital Inc.
    	
 
    	
Guarantor
    
	
Salon   Success International, LLC
    	
 
    	
Guarantor
    
	
Satin   Strands, Inc.
    	
 
    	
Guarantor
    
	
SBH   Finance B.V.
    	
 
    	
Canadian   Guarantor
    

 

Schedule II to Joinder to Loan Documents

 

 

	
Schoeneman   Beauty Supply, Inc.
    	
 
    	
Guarantor
    
	
Sexy   U Products, Inc.
    	
 
    	
Guarantor
    
	
Silk   Elements, Inc.
    	
 
    	
Guarantor
    
	
Soren   Enterprises, Inc.
    	
 
    	
Guarantor
    
	
Tanwise, Inc.
    	
 
    	
Guarantor
    
	
Venique,   Inc.
    	
 
    	
Guarantor
    

 

 

Schedule II to Joinder to Loan Documents

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