INCREMENTAL AMENDMENT

3.           Certain Defined Terms.  Certain defined terms used in this Incremental Amendment shall have the following meanings:

 

“Additional Subsidiary Guarantors” means any Domestic Subsidiaries acquired in connection with the Colomer Acquisition that become party to the Guaranty and to the Pledge and Security Agreement as Subsidiary Guarantors pursuant to the documents listed on Schedule II hereto, in each case, in form and substance reasonably satisfactory to the Administrative Agent.

 

“Diligence Deadline” means March 31, 2014 unless the Administrative Agent agrees in its sole discretion to extend such deadline; provided, that the Administrative Agent shall not be permitted to extend such deadline any later than April 15, 2014.

 

4.           Waiver of Certain Borrowing Base Terms.  From and after the date on which any Domestic Subsidiaries acquired in connection with the Colomer Acquisition become Additional Subsidiary Guarantors until the earlier of (x) the Diligence Deadline and (y) reasonably satisfactory completion of the Required Diligence (as defined below), for purposes of determining the Borrowing Base attributable to such Additional Subsidiary Guarantors, the following will be included in the Borrowing Base:

 

(a)           75% of the GAAP gross book value of any Accounts of such Additional Subsidiary Guarantors; and

 

(b)           50% of the GAAP gross book value of any Inventory of such Additional Subsidiary Guarantors.

 

Following the reasonably satisfactory completion of the Required Diligence, the Accounts and Inventory of the Additional Subsidiary Guarantors shall be subject to the eligibility criteria set forth in the Credit Agreement and the Borrowing Base attributable to the Additional Subsidiary Guarantors shall be determined in accordance with the definition of “Borrowing Base” (including any Eligible Equipment or Eligible Real Property of the Additional Subsidiary Guarantors, to the extent applicable).  If the Required Diligence is not satisfactorily completed prior to the Diligence Deadline, the Accounts and Inventory of the Additional Subsidiary Guarantors shall be deemed ineligible until the reasonably satisfactory completion of the Required Diligence.  The Administrative Agent and Collateral Agent hereby agree to use commercially reasonable efforts to complete the Required Diligence on or prior to the Diligence Deadline.

 

5.           Waiver of Section 3.1(b) Notice Period and Facility Increase Limit.  The Lenders that are party hereto hereby (a) waive the requirement set forth in Section 3.1(b) of the Credit Agreement that the Lenders be provided with ten (10) days prior notice of any proposed Facility Increase (as defined in the Credit Agreement) and (b) agree that the Incremental Commitments made available hereunder shall not be included when determining compliance with the $100 million limitation on Facility Increases set forth in Section 3.1(b) of the Credit Agreement and the entire aggregate principal amount of $100 million available for Facility Increases shall remain available to the Company.

 

6.           Incremental Upfront Fees.  The Company agrees to pay to the Administrative Agent (for the account of each Incremental Lender based on its pro rata portion of the Incremental Commitments) on the Facility Increase Date an upfront fee equal to 0.25% of the Incremental Commitments.

 

7.           Conditions to Effectiveness.  This Incremental Amendment shall become effective as of the first date (the “Facility Increase Date”) on which all of the following conditions have been satisfied or waived by the Incremental Lenders holding a majority of the Incremental Commitments (other than, for the avoidance of doubt, any amendment or waiver set forth in Section 4, the effectiveness of which shall be determined in accordance with the proviso in clause (a) below):

 

(a)           Incremental Amendment. The Administrative Agent (or its counsel) shall have received from the Company, the Incremental Lenders and the Administrative Agent, either (x) counterparts of this Incremental Amendment signed on behalf of such parties or (y) written evidence reasonably satisfactory to the Administrative Agent (which may include facsimile or other electronic transmissions of signed signature pages) that such parties have signed counterparts of this Incremental Amendment; provided that any amendment or waiver set forth in Sections 4 and 5 above shall not become effective unless and until the Administrative Agent (or its counsel) shall also have received the items referenced in clause (x) or (y) of this clause (a), as applicable, from the Supermajority Multi-Currency Lenders and the Required Lenders, respectively.

 

(b)           Reaffirmation Agreement.  Each of the existing Guarantors shall have entered into a reaffirmation agreement, consistent with that delivered in connection with Amendment No. 1 referred to in the introductory paragraph hereof or otherwise in form and substance reasonably satisfactory to the Administrative Agent.

 

(c)           Corporate Proceedings.  The Administrative Agent shall have received (i) certified copies of the charter and by-laws (or analogous organizational documents) of the Company and each existing Guarantor and (ii) the resolutions (or analogous authorizations), in form and substance reasonably satisfactory to the Administrative Agent, of the Board of Directors of the Company and each existing Guarantor, authorizing in each case the execution, delivery and performance of this Incremental Amendment and the other Loan Documents to which the Company or such Guarantor is a party, in each case certified by the Secretary or an Assistant Secretary of the Company or such Guarantor as of the Facility Increase Date and each such certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded as of the date of such certificate.

 

(d)           Incumbency Certificates.  The Administrative Agent shall have received a certificate of the Secretary or an Assistant Secretary (or analogous officer) of the Company and each existing Guarantor, dated as of the Facility Increase Date, as to the incumbency and signature of the officers of the Company and such Guarantor executing each of this Incremental Amendment and each other Loan Document to which the Company and such Guarantor is a party, and any certificate or other documents to be delivered by it pursuant thereto, together with evidence of the incumbency of such Secretary or Assistant Secretary (or analogous officer) as the case may be.

 

(e)           Legal Opinions.  The Administrative Agent shall have received executed legal opinions of (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP, as counsel to the Company, and (ii) the Executive Vice President and General Counsel of the Company, in each case, in form and substance reasonably satisfactory to the Administrative Agent and consistent with those delivered in connection with the Credit Agreement.  Each of the counsel delivering the foregoing legal opinions is expressly instructed to deliver its opinion for the benefit of each of the Administrative Agent, the Collateral Agent and each Incremental Lender.

 

(f)           Fees and Expenses.  The Administrative Agent shall have received or shall concurrently receive, for the accounts of the Incremental Lenders and the Agents, as applicable, the fees set forth in Section 6 above and all fees and expenses owing hereunder or in connection herewith to the Administrative Agent to the extent provided in the Credit Agreement and to the extent that such fees and expenses have been presented to the Company for payment at least two (2) Business Days prior to the Facility Increase Date (which amounts may, at the Company’s election, be offset against the proceeds of a Revolving Credit Loan on the Facility Increase Date).

 

(g)           USA Patriot Act.  Each of the Incremental Lenders shall have received prior to the Facility Increase Date (to the extent reasonably requested from the Company on a timely basis prior to the Facility Increase Date), all documentation and other information required by the applicable Governmental Authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the Patriot Act.

 

(h)           Request for Borrowing.  With respect to any Loan requested on the Facility Increase Date, the Administrative Agent shall have received a duly executed Notice of Borrowing.

 

(i)           Representations and Warranties.  Each of the representations and warranties made by each party to each Loan Document in or pursuant to the Credit Agreement, this Incremental Amendment or any other Loan Document, or contained in any certificate or financial statement (other than estimates and projections which are (x) identified as such and (y) contained in any financial statement) furnished at any time under or in connection with the Credit Agreement, this Incremental Amendment or any other Loan Document shall be true and correct in all material respects on and as of the Facility Increase Date as if made on and as of the Facility Increase Date (except to the extent that such representations and warranties relate to a particular date, in which case such representations and warranties shall be true and correct in all material respects on and as of such date), both before and after giving effect to any Loan and to all other extensions of credit to be made on the Facility Increase Date and the use of the proceeds thereof.

 

(j)           No Default.  No Event of Default and no Default shall have occurred and be continuing on the Facility Increase Date, before and after giving effect to the extensions of credit requested to be made on the Facility Increase Date.

 

(k)           Borrowing Base.  The Company shall have delivered the Borrowing Base Certificate most recently required to be delivered by Section 10.17 of the Credit Agreement.  After giving effect to the Loans requested to be made on the Facility Increase Date and the use of proceeds thereof, the Aggregate Outstanding Multi-Currency Extensions of Credit shall not exceed the Maximum Availability at such time.

 

8.           Post-Closing Covenants.

 

(a)           Mortgage Documents.  The Company shall provide to the Administrative Agent, no later than ninety (90) days (or such longer period as the Administrative Agent may agree) after the Facility Increase Date:

 

(i)           mortgage amendments (the “Mortgage Amendments”), as may be reasonably required by the Administrative Agent, each in form and substance reasonably satisfactory to the Administrative Agent, with respect to the Mortgaged Property, to the extent necessary to ensure that such Mortgaged Property shall be subject to a valid and enforceable Lien (having the priority set forth in the Intercreditor Agreement) in favor of the Collateral Agent (subject only to Liens permitted under Section 11.3 of the Credit Agreement) securing the Secured Obligations (including those related to the Incremental Commitments), each duly executed and delivered by an authorized officer of each party thereto and in form suitable for filing and recording in all filing or recording offices that the Administrative Agent may deem reasonably necessary or desirable;

 

(ii)           if Mortgage Amendments are required under clause (i) above, (A) date-down and modification endorsements to the title insurance policies or, where such date-down or modification endorsements are not available to insure the Mortgage Amendments set forth in clause (i) above, new title insurance policies with respect to the Mortgaged Property, each in form and substance reasonably satisfactory to the Administrative Agent which insure that such mortgages, as amended, continue to create valid and enforceable liens (having the priority set forth in the Intercreditor Agreement) subject to Section 11.3 of the Credit Agreement, (B) evidence reasonably satisfactory to the Administrative Agent that all certificates and affidavits reasonably required by the Administrative Agent and relating to the Company, the Mortgaged Property, such Mortgage Amendments and/or title endorsements (or if applicable, new title policies) have been delivered and (C) an opinion of counsel in each state in which any such Mortgage Amendment is to be recorded, in form and substance reasonably satisfactory to the Administrative Agent; and

 

(iii)           evidence that all fees, costs and expenses in connection with the preparation, execution, filing and recordation of the Mortgage Amendments, including, without limitation, reasonable attorneys’ fees, filing and recording fees, title insurance company coordination fees and premiums, documentary stamp, mortgage and intangible taxes and title search charges and other charges incurred in connection with the recordation of the Mortgage Amendments, have been paid in accordance with Section 14.5 of the Credit Agreement.

 

(b)           Additional Subsidiary Guarantors.

 

(i)           On or prior to the Diligence Deadline, the Company shall furnish to the Administrative Agent any information that the Administrative Agent or the Collateral Agent may reasonably request regarding the Additional Subsidiary Guarantors and their respective Accounts and Inventory.  The Administrative Agent or the Collateral Agent may, at the Company’s sole cost and expense, take such actions as specified in Section 10.17 of the Credit Agreement in relation to the Additional Subsidiary Guarantors (except with respect to the Real Property owned by the Additional Subsidiary Guarantors unless (x) the Company at its election requests the Administrative Agent to include such Real Property in the Borrowing Base or (y) a Mortgage is required pursuant to Section 10.15 of the Credit Agreement) in a manner and through any medium that the Administrative Agent or the Collateral Agent considers reasonably advisable (the “Required Diligence”) and the Company shall furnish all such assistance and information as the Administrative Agent may require in connection with the Required Diligence.  For the avoidance of doubt, the parties hereto agree that the limitation on (i) Appraisals, investigations and reviews set forth in Section 10.17(b) of the Credit Agreement and (ii) verifications and reports set forth in Section 10.17(d) of the Credit Agreement, shall not apply to the Required Diligence on a one-time basis.  Notwithstanding the foregoing, the only consequence of the Required Diligence not being completed prior to the Diligence Deadline is as set forth in Section 4 hereof;

 

 

IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Incremental Amendment as of the date first written above.

 

	CITICORP USA, INC., as Administrative Agent and Collateral Agent
	By:	/s/ Michael Smolow
		Name: Michael Smolow
		Title:   Director

	REVLON CONSUMER PRODUCTS CORPORATION
	By:	/s/ Michael T. Sheehan
		Name: Michael T. Sheehan
		Title:   Senior Vice President, Deputy General
		Counsel & Secretary

	CITIBANK, N.A., as an Incremental Lender and as an Issuing Lender
	By:	/s/ Michael Smolow
		Name:  Michael Smolow
		Title:    Director

	JPMORGAN CHASE BANK, N.A., as an Incremental Lender
	By:	/s/ Donna DiForio
		Name: Donna DiForio
		Title:   Authorized Officer

	BANK OF AMERICA, N.A., as an Incremental Lender
	By:	/s/ Robert Scalzitti
		Name: Robert Scalzitti
		Title:   Senior Vice President

	CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as an Incremental Lender
	By:	/s/ Vipul Dhadda
		Name: Vipul Dhadda
		Title:   Authorized Signatory

	By:	/s/ Sally Reyes
		Name: Sally Reyes
		Title:  Authorized Signatory

	WELLS FARGO CAPITAL FINANCE, LLC, as an Incremental Lender
	By:	/s/ Reza Sabahi
		Name:  Reza Sabahi
		Title:    Duly Authorized Signer

 

Incremental Lender	Incremental Commitment
Citibank, N.A.	$10,000,000
Wells Fargo Capital Finance, LLC	$8,750,000
JPMorgan Chase Bank, N.A.	$6,250,000
Bank of America, N.A.	$6,250,000
Credit Suisse AG, Cayman Islands Branch	$3,750,000
Total	$35,000,000

 

1.	Joinder Agreement to the Pledge and Security Agreement;
2.	Guaranty Supplement;
3.	Pledge Amendment relating to the pledge of issued and outstanding Stock and Stock Equivalents of the Additional Subsidiary Guarantors;
4.	Patent Security Supplement, if applicable;
5.	Trademark Security Supplement, if applicable;
6.	Certificate of such Additional Subsidiary Guarantors attaching (i) copies of the Charter and by-laws (or analogous organizational documents) of such Additional Subsidiary Guarantors, (ii) resolutions (or analogous authorization) of the Boards of Directors of such Additional Subsidiary Guarantors, (iii) certificates of good standing from the jurisdiction of organization of such Additional Subsidiary Guarantors, and (iv) certifying as to incumbency and signature of officers of such Additional Subsidiary Guarantors executing each Loan Document;
7.	Legal opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP, as counsel to the Additional Subsidiary Guarantors;
8.	Legal opinion of the Executive Vice President and General Counsel of the Company; and
9.	Legal opinion of California local counsel to the Additional Subsidiary Guarantors incorporated in California.