[CSS]
SECOND AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT
This SECOND AMENDMENT (this "Amendment"), dated as of July 29, 2003, is
among CSS FUNDING LLC, a Delaware limited liability company, as seller (the
"Seller"), CSS INDUSTRIES, INC., a Delaware corporation ("CSS"), as initial
servicer (in such capacity, together with its successors and permitted assigns
in such capacity, the "Servicer"), MARKET STREET FUNDING CORPORATION, a Delaware
corporation (together with its successors and permitted assigns, the "Issuer"),
and PNC BANK, NATIONAL ASSOCIATION, a national banking association ("PNC"), as
administrator (in such capacity, together with its successors and assigns in
such capacity, the "Administrator").
RECITALS
1. The Seller, the Servicer, the Issuer and the Administrator are
parties to the Receivables Purchase Agreement, dated as of April 30, 2001 (as
amended, supplemented or otherwise modified from time to time, the "Agreement").
2. The Seller, the Servicer, the Issuer and the Administrator desire to
amend the Agreement as hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1. Amendments to the Agreement.
(a) Article V of the Agreement is hereby amended by inserting
the following Section 5.15 therein:
Section 5.15. Call Option. The Seller shall have the
right to repurchase the Purchased Interest from the Issuer on
any Settlement Date on the terms hereinafter set forth in this
Section 5.15. The Seller shall give the Administrator at least
ten Business Days' prior written notice of such repurchase and
upon payment of the repurchase price for the Purchased
Interest, as hereinafter provided, the Issuer shall be deemed
to have reconveyed the Purchased Interest to the Seller
without recourse, representation or warranty except for a
representation from the Issuer that the Purchased Interest
assigned is (or concurrently with the Administrator's receipt
of such repurchase price shall become) free of any Adverse
Claim created by the Issuer. The Seller shall pay such
repurchase price for the Purchased Interest in immediately
available funds to the Administrator (for the benefit of the
Issuer or the Administrator, as the case may be) in an amount
equal to the sum of (i) the aggregate of the Discount accrued
for each Portion of Capital for the Issuer accrued to and
including the repurchase date, (ii) the Capital for the
Issuer, (iii) the amounts payable pursuant to Sections 1.5,
1.7 and 1.8, or Article III (of which the Seller has notice)
related to the Purchased Interest accrued to and including the
repurchase date, (iv) all other obligations that are then due
and payable and (v) if CSS is not the Servicer, the Servicing
Fee allocated to the Purchased Interest that has accrued to
and including the repurchase date.
(b) The definition of "Default Ratio" set forth in Exhibit I
to the Agreement is hereby amended and restated in its entirety as
follows:
"Default Ratio" means the ratio (expressed as a
percentage and rounded to the nearest 1/100 of 1%, with
5/1000th of 1% rounded upward) computed as of the last day of
each calendar month by dividing: (a) the sum of the Berwick
Default Amount, plus the Cleo Default Amount, plus the Paper
Magic Default Amount, plus the Lion Default Amount by (b) the
sum of the Berwick Default Factor, plus the Cleo Default
Factor, plus the Paper Magic Default Factor, plus the Lion
Default Factor.
(c) The definition of "Defaulted Receivables" set forth in
Exhibit I to the Agreement is hereby amended by inserting the sentence
"The Outstanding Balance of any Defaulted Receivable shall be
determined without regard to any credit memos or credit balances." to
the end thereof.
(d) The definition of "Delinquent Receivables" set forth in
Exhibit I to the Agreement is hereby amended by inserting the sentence
"The Outstanding Balance of any Delinquent Receivable shall be
determined without regard to any credit memos or credit balances." to
the end thereof.
(e) The definition of "Eligible Receivable" set forth in
Exhibit I to the Agreement is hereby amended by adding the following
clause therein:
(q) for which the addition of the Originator
thereof to the transaction pursuant to Section 4.3 of
the Purchase and Sale Agreement (if applicable), has
not resulted in the continued failure to enact any
amendments or modifications of any Transaction
Document or related opinion for more than 10 Business
Days after initially required by Moody's or Standard
and Poor's with respect to the addition of such
Originator.
(f) Clause (y) of the definition of "Loss Reserve Percentage"
set forth in Exhibit I to the Agreement is hereby amended by inserting
the phrase "or, in the case of Lion, 0%" immediately following the
phrase "Berwick, 80%" therein.
(g) The definition of "Specifically Reserved Dilution Amount"
set forth in Exhibit I to the Agreement is hereby amended by inserting
the phrase "plus the Lion Specifically Reserved Dilution Amount" to the
end thereof.
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(h) Exhibit I to the Agreement is hereby amended by adding the
following definitions as alphabetically appropriate:
"Lion" means Lion Ribbon Company, Inc., a Delaware
corporation.
"Lion Current Day Sales Outstanding" means, for any
calendar month, an amount computed as of the last day of such
calendar month equal to: (a) the arithmetic average of the
Outstanding Balances of all Pool Receivables originated by
Lion that were not past their respective due dates as of the
last day of the most recent three calendar months divided by
(b)(i) the average of the aggregate credit sales made by Lion
during most recent three calendar months divided by (ii) 90.
"Lion Default Amount" means an amount computed as of
the last day of each calendar month equal to: (a) the
aggregate Outstanding Balance of all Pool Receivables, the
Originator of which is Lion, that became Defaulted Receivables
during such month minus (b) the portion of such Defaulted
receivables which represent the Reserved Dispute Amount.
"Lion Default Factor" means the sum of (a) for any
calendar month, the Lion Sales 30 Day Terms during the
calendar month that is four calendar months prior to such
month plus (b) for any calendar month, an amount equal to the
product of (i) Lion Sales Other during the calendar month that
is five calendar months prior to such month, and (ii) Lion
Dynamic Terms Factor plus (c) for the month of March, the
aggregate credit sales made by Lion during the months of June
through November times 2% (or such other factors as reasonably
determined by the Administrator and CSS, as may be
representative of the percentage of Obligors of Lion with
original invoice payment dates of December 1st or such other
date after December 1st), plus (d) for the month of September,
the aggregate credit sales made by Lion during the month of
March times 1% (or such other factors as reasonably determined
by the Administrator and CSS, as may be representative of the
percentage of Obligors of Lion with original invoice payment
terms greater than 60 days but less than or equal to 90 days).
"Lion Delinquency Ratio" means the ratio (expressed
as a percentage and rounded to the nearest 1/100 of 1%, with
5/1000th of 1% rounded upward) computed as of the last day of
each calendar month by dividing: (a) the aggregate Outstanding
Balance of all Pool Receivables, the Originator of which is
Lion, that were Delinquent Receivables on such day by (b) the
aggregate Outstanding Balance of all Pool Receivables, the
Originator of which is Lion, on such day.
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"Lion Dynamic Terms Factor" means for any calendar
month, the portion of aggregate monthly credit sales made by
Lion that are deemed to represent sales terms greater than 30
days and less than or equal to 60 days as determined using the
formula and factors set forth opposite such month in Schedule
V (or such other factor(s) as reasonably determined by the
Administrator and CSS, as may be representative of the portion
of Obligors of Lion with original invoice payment terms
greater than 30 days but less than or equal to 60 days).
"Lion Sales 30 Day Terms" means, for any calendar
month, the aggregate credit sales made by Lion during such
calendar month that have a maturity which is less than or
equal to 30 days after the original invoice date of such
Receivable.
"Lion Sales Other" means, for any calendar month, an
amount equal to: (a) the aggregate credit sales made by Lion
during such month minus (b) Lion Sales 30 Day Terms for such
calendar month.
"Lion Specifically Reserved Dilution Amount" means,
for any calendar month, the sum of the reported reserves for
Obligor programs and returns and allowances on the books and
records of Lion at the end of such month.
(i) Clause (g) of Exhibit V to the Agreement is hereby amended
and restated in its entirety as follows:
(g)(i) the (A) Default Ratio shall exceed 7.25% or
(B) for any of the months of September, October, November and
December the Delinquency Ratio shall exceed 4.8% or (C) for
any of the months of January, February, March, April, May,
June, July and August the Lion Delinquency Ratio shall exceed
15% or (ii) the arithmetic average for the three most recent
consecutive calendar months of: (A) the Default Ratios shall
exceed 4.65%, or (B) the Dilution Ratios shall exceed 5.0% or
(iii) the arithmetic average Delinquency Ratios over the
months of September, October, November and December shall
exceed 4.8% or (iv) the Lion Current Days Sales Outstanding
shall exceed 60 days.
(j) Schedule II of the Agreement is hereby replaced in its
entirety with Schedule II hereto.
(k) The attached Schedule V is hereby inserted in the
Agreement in its entirety.
SECTION 2. Conditions to Effectiveness.
This Amendment shall become effective as of the date hereof subject to
(i) the condition precedent that the Administrator shall have received the
following, each duly executed and dated as of the date hereof (or such other
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date satisfactory to the Administrator), in form and substance satisfactory to
the Administrator:
(a) counterparts of this Amendment (whether by facsimile or
otherwise) executed by each of the parties hereto; and
(b) such other documents and instruments as the Administrator
may reasonably request.
SECTION 3. Effect of Amendment; Ratification. Except as specifically
amended hereby, the Agreement is hereby ratified and confirmed in all respects,
and all of its provisions shall remain in full force and effect. After this
Amendment becomes effective, all references in the Agreement (or in any other
Transaction Document) to "the Receivables Purchase Agreement", "this Agreement",
"hereof", "herein", or words of similar effect, in each case referring to the
Agreement, shall be deemed to be references to the Agreement as amended hereby.
This Amendment shall not be deemed to expressly or impliedly waive, amend, or
supplement any provision of the Agreement other than as specifically set forth
herein.
SECTION 4. Counterparts. This Amendment may be executed in any number
of counterparts and by different parties on separate counterparts, and each
counterpart shall be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
SECTION 5. Governing Law. This Amendment shall be governed by, and
construed in accordance with, the internal laws of the State of New York without
regard to any otherwise applicable conflict of laws principles.
SECTION 6. Section Headings. The various headings of this Amendment are
inserted for convenience only and shall not affect the meaning or interpretation
of this Amendment or the Agreement or any provision hereof or thereof.
[SIGNATURE PAGES TO FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
CSS FUNDING LLC
By: _____________________________________
Name: _______________________________
Title: ______________________________
CSS INDUSTRIES, INC.
By: _____________________________________
Name: _______________________________
Title: ______________________________
S-1 Second Amendment to RPA (CSS)
BERWICK OFFRAY LLC
(f/k/a Berwick Industries LLC),
as a Subservicer
By: _____________________________________
Name: _______________________________
Title: ______________________________
CLEO INC,
as a Subservicer
By: _____________________________________
Name: _______________________________
Title: ______________________________
LION RIBBON COMPANY, INC.,
as a Subservicer
By: _____________________________________
Name: _______________________________
Title: ______________________________
THE PAPER MAGIC GROUP, INC.,
as a Subservicer
By: _____________________________________
Name: _______________________________
Title: ______________________________
S-2 Second Amendment to RPA (CSS)
MARKET STREET FUNDING CORPORATION
By: _____________________________________
Name: _______________________________
Title: ______________________________
S-3 Second Amendment to RPA (CSS)
PNC BANK, NATIONAL ASSOCIATION,
as Administrator
By: _____________________________________
Name:________________________________
Title:_______________________________
S-4 Second Amendment to RPA (CSS)
SCHEDULE II
LOCK-BOX BANKS AND LOCK-BOX ACCOUNTS
Lock-Box Bank Lock-Box Account
------------- -------- -------
First Union National Bank
AmSouthBank
Union Planters Bank, N.A.
SCHEDULE V
LION DYNAMIC TERMS PERCENTAGE
- --------------------------------------------------------------------------------
DEFAULT DATE LION DYNAMIC TERMS FACTOR *
- --------------------------------------------------------------------------------
January 0.26 plus [0.70 minus (Lion Sales 30 Day Terms in August
divided by Lion aggregate credit sales in August)]
- --------------------------------------------------------------------------------
February 0.44 plus [0.54 minus (Lion Sales 30 Day Terms in September
divided by Lion aggregate credit sales in September)]
- --------------------------------------------------------------------------------
March 0.39 plus [0.61 minus (Lion Sales 30 Day Terms in October
divided by Lion aggregate credit sales in October)]
- --------------------------------------------------------------------------------
April 0.47 plus [0.53 minus (Lion Sales 30 Day Terms in November
divided by Lion aggregate credit sales in November)]
- --------------------------------------------------------------------------------
May 0.45 plus [0.55 minus (Lion Sales 30 Day Terms in December
divided by Lion aggregate credit sales in December)]
- --------------------------------------------------------------------------------
June 0.46 plus [0.54 minus (Lion Sales 30 Day Terms in January
divided by Lion aggregate credit sales in January)]
- --------------------------------------------------------------------------------
July 0.59 plus [0.41 minus (Lion Sales 30 Day Terms in February
divided by Lion aggregate credit sales in February)]
- --------------------------------------------------------------------------------
August 0.46 plus [0.53 minus (Lion Sales 30 Day Terms in March
divided by Lion aggregate credit sales in March)]
- --------------------------------------------------------------------------------
September 0.55 plus [0.45 minus (Lion Sales 30 Day Terms in April
divided by Lion aggregate credit sales in April)]
- --------------------------------------------------------------------------------
October 0.43 plus [0.57 minus (Lion Sales 30 Day Terms in May
divided by Lion aggregate credit sales in May)]
- --------------------------------------------------------------------------------
November 0.54 plus [0.43 minus (Lion Sales 30 Day Terms in June
divided by Lion aggregate credit sales in June)]
- --------------------------------------------------------------------------------
December 0.51 plus [0.46 minus (Lion Sales 30 Day Terms in July
divided by Lion aggregate credit sales in July)]
- --------------------------------------------------------------------------------
*Lion Dynamic Terms Factor represents the portion of Lion credit sales
that have credit terms of 60 days and is calculated based on (a) the
historical/original 60 day sale terms factor plus (b) (i) the
historical/original 30 day sale terms factor less (ii) actual 30 day sale terms
factor.