-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ab0sKhyLfEzQmZ/YC1ZQAyGgqj4DEcjaVmwWlm2rymoekzQRK9ud1h8QlNxNDSkN 9YTSZHKoEosm7F7a4vznmQ== 0001157523-06-007557.txt : 20060728 0001157523-06-007557.hdr.sgml : 20060728 20060728113542 ACCESSION NUMBER: 0001157523-06-007557 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060728 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060728 DATE AS OF CHANGE: 20060728 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REVLON CONSUMER PRODUCTS CORP CENTRAL INDEX KEY: 0000890547 STANDARD INDUSTRIAL CLASSIFICATION: PERFUMES, COSMETICS & OTHER TOILET PREPARATIONS [2844] IRS NUMBER: 133662953 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 033-59650 FILM NUMBER: 06986574 BUSINESS ADDRESS: STREET 1: 237 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2125274000 MAIL ADDRESS: STREET 1: 237 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10017 8-K 1 a5197703.txt REVLON CONSUMER PRODUCTS CORPORATION 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 28, 2006 (July 28, 2006) Revlon Consumer Products Corporation ------------------------------------ (Exact Name of Registrant as Specified in its Charter) Delaware 33-59650 13-3662953 - -------------------------------------------------------------------------------- (State or Other Jurisdiction (Commission (I.R.S. Employer of Incorporation) File Number) Identification No.) 237 Park Avenue New York, New York 10017 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (212) 527-4000 (Registrant's telephone number, including area code) None (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01. Entry into a Material Definitive Agreement On July 28, 2006, Revlon Consumer Products Corporation ("RCPC") entered into a second amendment (the "Credit Agreement Amendment") to its Credit Agreement, dated as of July 9, 2004, among RCPC, certain of its subsidiaries as local borrowing subsidiaries, a syndicate of lenders, and Citicorp USA, Inc., as multi-currency administrative agent, term loan administrative agent and collateral agent, filed as Exhibit 4.34 to the Current Report on Form 8-K of RCPC filed with the Securities and Exchange Commission (the "SEC") on July 13, 2004 (as amended by Amendment No. 1, dated as of February 15, 2006, filed as Exhibit 10.2 to the Current Report on Form 8-K of RCPC filed with the SEC on February 17, 2006, the "2004 Credit Agreement"). Among other things, the Credit Agreement Amendment increased the existing $700 million term loan facility under the 2004 Credit Agreement by $100 million and amended the senior secured leverage ratio covenant. A copy of the Credit Agreement Amendment is attached hereto as Exhibit 4.1, and its terms are incorporated by reference herein. For the convenience of investors, the following is a description of the 2004 Credit Agreement, after giving effect to the Credit Agreement Amendment (as amended, the "Amended Credit Agreement"). Investors should refer to the 2004 Credit Agreement, including all amendments thereto. Unless otherwise indicated, capitalized terms have the meanings given to them in the Amended Credit Agreement. The Amended Credit Agreement provides up to $960 million and consists of an $800.0 million term loan facility (the "Term Loan Facility") and a $160.0 million asset-based multi-currency revolving credit facility (the "Multi-Currency Facility" and, together with the Term Loan Facility, the "2004 Credit Facilities"). Availability under the Multi-Currency Facility varies based upon a borrowing base that is determined by the value of eligible accounts receivable, eligible inventory and eligible real property and equipment in the U.S. and the U.K. from time to time. RCPC may request the Multi-Currency Facility to be increased from time to time in an aggregate principal amount not to exceed $50.0 million, subject to certain exceptions and subject to the agreement of the lenders. The Multi-Currency Facility is available to: (i) RCPC in revolving credit loans denominated in U.S. dollars; (ii) RCPC in swing line loans denominated in U.S. dollars up to $25 million; (iii) RCPC in standby and commercial letters of credit denominated in U.S. dollars and other currencies up to $50 million; and (iv) RCPC and certain of its international subsidiaries designated from time to time in revolving credit loans and bankers' acceptances denominated in U.S. dollars and other currencies, in each case subject to borrowing base availability. If the value of the eligible assets is not sufficient to support the $160 million borrowing base under the Multi-Currency Facility, RCPC will not have full access to the Multi-Currency Facility. RCPC's ability to make borrowings under the Multi-Currency Facility is also conditioned upon the satisfaction of certain conditions precedent and RCPC's compliance with other covenants in the Amended Credit Agreement, including a fixed charge coverage ratio that applies when the excess borrowing base (representing the difference between (1) the borrowing base under the Multi-Currency Facility and (2) the amounts outstanding under the Multi-Currency Facility) is less than $30.0 million. The Multi-Currency Facility will terminate on July 9, 2009, and the loans under the Term Loan Facility will mature on July 9, 2010; provided that the Amended Credit Agreement will terminate on October 30, 2007 if RCPC's 8 5/8% Senior Subordinated Notes due 2008 (the "8 5/8% Senior Subordinated Notes") are not redeemed, repurchased, defeased or 2 repaid on or before such date such that not more than $25.0 million in aggregate principal amount of the 8 5/8% Senior Subordinated Notes remains outstanding. Borrowings under the Multi-Currency Facility (other than loans in foreign currencies) bear interest at a rate equal to, at RCPC's option, either (A) the Alternate Base Rate plus 1.50%; or (B) the Eurodollar Rate plus 2.50%. Loans in foreign currencies bear interest in certain limited circumstances, or if mutually acceptable to RCPC and the relevant foreign lenders, at the Local Rate, and otherwise at the Eurocurrency Rate, in each case plus 2.50%. The loans under the Term Loan Facility bear interest at a rate equal to, at RCPC's option, either (A) the Alternate Base Rate plus 5.00%; or (B) the Eurodollar Rate plus 6.00%. RCPC pays to those lenders under the Multi-Currency Facility a commitment fee of 0.50% of the average daily unused portion of the Multi-Currency Facility, which fee is payable quarterly in arrears. Under the Multi-Currency Facility, RCPC pays: (i) to foreign lenders a fronting fee of 0.25% per annum on the aggregate principal amount of specified Local Loans (which fee is retained by foreign lenders out of the portion of the Applicable Margin payable to such foreign lender); (ii) to foreign lenders an administrative fee of 0.25% per annum on the aggregate principal amount of specified Local Loans; (iii) to the multi-currency lenders a letter of credit commission equal to the product of (a) the Applicable Margin for revolving credit loans that are Eurodollar Rate loans (adjusted for the term that the letter of credit is outstanding) and (b) the aggregate undrawn face amount of letters of credit; and (iv) to the issuing lender, a letter of credit fronting fee of 0.25% per annum of the aggregate undrawn face amount of letters of credit, which fee is a portion of the Applicable Margin. Prior to the termination date of the Term Loan Facility, on October 15, January 15, April 15 and July 15 of each year (commencing October 15, 2006), RCPC shall repay $2.0 million in aggregate principal amount of the term loans outstanding under the Term Loan Facility on each respective date. In addition, the loans under the Term Loan Facility are required to be prepaid with: (i) the net proceeds in excess of $10.0 million each year (subject to limited carryover to subsequent years, which amount, as of July 28, 2006, is $25 million as a result of carryovers) received during such year from sales of Term Loan First Lien Collateral (as defined below) by RCPC or any of its subsidiary guarantors (and in excess of an additional $25.0 million in the aggregate during the term of the 2004 Credit Facilities with respect to certain specified dispositions), subject to certain limited exceptions, (ii) certain net proceeds from equity offerings by Revlon, Inc., RCPC's parent company, that are not used to redeem, repurchase or defease RCPC's 8 5/8% Senior Subordinated Notes or certain other indebtedness, (iii) the net proceeds from the issuance by RCPC or any of its subsidiaries of certain additional debt and (iv) 50% of RCPC's Excess Cash Flow. The 2004 Credit Facilities are supported by, among other things, guarantees from Revlon, Inc. and, subject to certain limited exceptions, the domestic subsidiaries of RCPC. The obligations of RCPC under the 2004 Credit Facilities and the obligations under the guarantees are secured by, subject to certain limited exceptions, substantially all of the assets of RCPC and the subsidiary guarantors, including: (i) mortgages on owned real property, including RCPC's facilities in Oxford, North Carolina and Irvington, New Jersey; (ii) the capital stock of RCPC and the subsidiary guarantors and 66% of the capital stock of RCPC's and the subsidiary guarantors' first-tier foreign subsidiaries; (iii) intellectual property and other intangible property of RCPC and the subsidiary guarantors; and (iv) inventory, accounts receivable, equipment, investment property and deposit accounts of RCPC and the subsidiary guarantors. The liens on, among other things, inventory, accounts receivable, deposit accounts, investment property (other than the capital stock of RCPC and its subsidiaries), real property, equipment, fixtures and 3 certain intangible property related thereto secure the Multi-Currency Facility on a first priority basis and the Term Loan Facility on a second priority basis, while the liens on the capital stock of RCPC and its subsidiaries and intellectual property and certain other intangible property (the "Term Loan First Lien Collateral") secure the Term Loan Facility on a first priority basis and the Multi-Currency Facility on a second priority basis, all as set forth in an Intercreditor and Collateral Agency Agreement by and among RCPC and the lenders, which also provides that the first priority liens referred to above may be shared from time to time, subject to certain limitations, with specified types of other obligations incurred or guaranteed by RCPC, such as foreign exchange and interest rate hedging obligations and foreign working capital lines, provided that to the extent such obligations and lines share in the collateral, the borrowing base is reduced by a reserve established from time to time by the bank agent in respect of such obligations and lines. The Amended Credit Agreement contains various restrictive covenants prohibiting RCPC and its subsidiaries from: (i) incurring additional indebtedness or guarantees, with certain exceptions; (ii) making dividend and other payments or loans to Revlon, Inc. or other affiliates, with certain exceptions, including among others, (a) exceptions permitting RCPC to pay dividends or make other payments to Revlon, Inc. to finance the actual payment by Revlon, Inc. of expenses and obligations incurred by Revlon, Inc. to enable Revlon, Inc. to, among other things, pay expenses incidental to being a public holding company, including, among other things, professional fees such as legal and accounting fees, regulatory fees such as the SEC filing fees and other miscellaneous expenses related to being a public holding company, (b) subject to certain circumstances, to finance the purchase by Revlon, Inc. of its Class A Common Stock in connection with the delivery of such Class A Common Stock to grantees under the Amended and Restated Revlon, Inc. Stock Plan, and (c) subject to certain limitations, to pay dividends or make other payments to finance the purchase, redemption or other retirement for value by Revlon, Inc. of stock or other equity interests or equivalents in Revlon, Inc. held by any current or former director, employee or consultant in his or her capacity as such; (iii) creating liens or other encumbrances on RCPC's or its subsidiaries' assets or revenues, granting negative pledges or selling or transferring any of RCPC's or its subsidiaries' assets, all subject to certain limited exceptions; (iv) with certain exceptions, engaging in merger or acquisition transactions; (v) prepaying indebtedness and modifying the terms of certain indebtedness and specified material contractual obligations, subject to certain exceptions; (vi) making investments, subject to certain exceptions; and (vii) entering into transactions with affiliates of RCPC other than upon terms no less favorable to RCPC or its subsidiaries than it would obtain in an arms' length transaction. In addition to the foregoing, the Amended Credit Agreement contains financial covenants limiting the senior secured leverage ratio of RCPC (the ratio of RCPC's Senior Secured Debt to EBITDA, as each such term is defined in the Amended Credit Agreement) to 5.5 to 1 for the period of four consecutive fiscal quarters ending during the period from June 30, 2006 to June 30, 2007, stepping down to 5.0 to 1 for the period of four consecutive fiscal quarters ending during each subsequent fiscal quarter during the remaining term of the Amended Credit Agreement, and, under circumstances when the difference between (1) the borrowing base under the Multi-Currency Facility and (2) the amounts outstanding under the Multi-Currency Facility is less than $30.0 million for a period of 30 consecutive days or more, requiring RCPC to maintain a consolidated fixed charge coverage ratio (the ratio of EBITDA minus Capital Expenditures to Cash Interest Expense for such period, as each such term is defined in the Amended Credit Agreement) of 1.00 to 1.00. The events of default under the Amended Credit Agreement include customary events of default for such types of agreements, including: (i) nonpayment of any principal, interest 4 or other fees when due, subject in the case of interest and fees to a grace period; (ii) non-compliance with the covenants in the Amended Credit Agreement or the ancillary security documents, subject in certain instances to grace periods; (iii) the institution of any bankruptcy, insolvency or similar proceedings by or against RCPC, any of RCPC's subsidiaries or Revlon, Inc., subject in certain instances to grace periods; (iv) default by Revlon, Inc., or any of its subsidiaries (a) in the payment of certain indebtedness when due (whether at maturity or by acceleration) in excess of $5.0 million in aggregate principal amount or (b) in the observance or performance of any other agreement or condition relating to such debt, provided that the amount of debt involved is in excess of $5.0 million in aggregate principal amount, or the occurrence of any other event, the effect of which default or other event is to cause or permit the holders of such debt to cause the acceleration of payment of such debt; (v) the failure by RCPC, certain of RCPC's subsidiaries or Revlon, Inc., to pay certain material judgments; (vi) a change of control such that (a) Revlon, Inc. shall cease to be the beneficial and record owner of 100% of RCPC's capital stock, (b) Ronald O. Perelman (or his estate, heirs, executors, administrator or other personal representative) and his or their controlled affiliates shall cease to "control" RCPC, and any other person or group or persons owns more than 25% of the total voting power of Revlon, Inc., (c) any person or group of persons other than Ronald O. Perelman (or his estate, heirs, executors, administrator or other personal representative) and his or their controlled affiliates shall "control" RCPC or (d) the current directors serving on RCPC's Board of Directors (or other directors nominated by at least 66 2/3% of such continuing directors) shall cease to be a majority of the directors; (vii) the failure by Revlon, Inc. to contribute to RCPC all of the net proceeds it receives from any other sale of its equity securities or RCPC's capital stock, subject to certain limited exceptions; (viii) the failure of any of RCPC's, its subsidiaries' or Revlon, Inc.'s representations or warranties in any of the documents entered into in connection with the Amended Credit Agreement to be correct, true and not misleading in all material respects when made or confirmed; (ix) the conduct by Revlon, Inc., of any meaningful business activities other than those that are customary for a publicly traded holding company which is not itself an operating company, including the ownership of meaningful assets (other than RCPC's capital stock) or the incurrence of debt, in each case subject to limited exceptions; (x) MacAndrews & Forbes' failure to fund any binding commitment under the 2004 Consolidated MacAndrews & Forbes Line of Credit; and (xi) the failure of certain of RCPC's affiliates which hold RCPC's or its subsidiaries' indebtedness to be party to a valid and enforceable agreement prohibiting such affiliate from demanding or retaining payments in respect of such indebtedness. Item 8.01. Other Events. On July 28, 2006, Revlon, Inc., RCPC's parent company, issued a press release (the "Press Release") announcing the consummation of the Credit Agreement Amendment. A copy of the Press Release is attached to this report as Exhibit 99.1 and is incorporated by reference herein. Item 9.01. Financial Statements and Exhibits. (d) Exhibits Exhibit No. Description ----------- ----------- 4.1 Amendment to Credit Agreement, dated July 28, 2006. 99.1 Press Release, dated July 28, 2006 (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K of Revlon, Inc. filed with the Securities and Exchange Commission on July 28, 2006). 5 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. REVLON CONSUMER PRODUCTS CORPORATION By: /s/ Robert K. Kretzman ------------------------------- Name: Robert K. Kretzman Title: Executive Vice President and General Counsel Date: July 28, 2006 6 EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 4.1 Amendment to Credit Agreement, dated July 28, 2006. 99.1 Press Release, dated July 28, 2006 (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K of Revlon, Inc. filed with the Securities and Exchange Commission on July 28, 2006). 7 EX-4.1 2 a5197703ex4_1.txt EXHIBIT 4.1 Exhibit 4.1 AMENDMENT NO. 2 AMENDMENT NO. 2, dated as of July 28, 2006 (this "Amendment"), by and among Revlon Consumer Products Corporation (the "Company"), Citicorp USA, Inc., as administrative agent for the Term Loan Lenders (in such capacity, the "Term Loan Administrative Agent"), and Citicorp USA, Inc., as administrative agent for the Multi-Currency Lenders (in such capacity, the "Multi-Currency Administrative Agent" and, together with the Term Loan Administrative Agent, the "Administrative Agents"). W I T N E S S E T H: WHEREAS, the Company and the Administrative Agents are parties to that certain Credit Agreement, dated as of July 9, 2004 (as amended by Amendment No. 1 thereto dated as of February 15, 2006, the "Credit Agreement"), among the Company and the Local Borrowing Subsidiaries, as borrowers, the Lenders and Issuing Lenders party thereto, the Term Loan Administrative Agent, the Multi-Currency Administrative Agent and Citicorp USA, Inc., as collateral agent for the Secured Parties; and WHEREAS, the Company has requested that the Administrative Agents, on behalf of the Lenders, enter into this Amendment to amend the Credit Agreement as set forth herein; NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement. 2. Amendments. Effective as of the Effective Date (as defined below) and subject to the terms and conditions set forth herein, the Credit Agreement is hereby amended as follows: (a) Section 1.1 of the Credit Agreement is hereby amended by inserting the following definitions among the existing definitions set forth in such section in alphabetical order: "Additional Term Loan" and "Additional Term Loans" shall have the meanings assigned to such terms in Section 2.1(b). "Additional Term Loan Commitment" shall mean, with respect to each Additional Term Loan Lender, the obligation of such Additional Term Loan Lender to make Additional Term Loans to the Company on the Amendment No. 2 Effective Date, in an aggregate principal amount not to exceed the amount set forth opposite such Additional Term Loan Lender's name on Schedule IIA; collectively, as to all such Additional Term Loan Lenders, the "Additional Term Loan Commitments". "Additional Term Loan Facility" shall mean the Additional Term Loan Commitments and the provisions herein related to the Additional Term Loans. "Additional Term Loan Lender" shall mean each bank or other financial institution from time to time party hereto which holds an Additional Term Loan Commitment or an Additional Term Loan; collectively, the "Additional Term Loan Lenders". "Additional Term Loan Percentage" shall mean, at any date with respect to each Additional Term Loan Lender, the percentage which the aggregate outstanding principal amount of such Additional Term Loan Lender's Additional Term Loans at such date constitutes of the aggregate outstanding principal amount of Additional Term Loans of all Additional Term Loan Lenders at such date. "Aggregate Additional Term Loan Commitment" shall mean, at any time, the aggregate amount of the Additional Term Loan Commitments of all Additional Term Loan Lenders then in effect. The original amount of the Aggregate Additional Term Loan Commitment is $100,000,000. "Aggregate Original Term Loan Commitment" shall mean, at any time, the aggregate amount of the Original Term Loan Commitments of all Original Term Loan Lenders then in effect. The original amount of the Aggregate Original Term Loan Commitment is $800,000,000. "Amendment No. 2" shall mean the Amendment No. 2, dated as of July 28, 2006, by and among the Company, the Term Loan Administrative Agent and the Multi-Currency Administrative Agent, to this Agreement. "Amendment No. 2 Effective Date" shall mean the Effective Date (as defined in Amendment No. 2). "Original Term Loan" and "Original Term Loans" shall have the meanings assigned to such terms in Section 2.1(a). "Original Term Loan Commitment" shall mean, with respect to each Original Term Loan Lender, the obligation of such Original Term Loan Lender to make Original Term Loans to the Company on the Closing Date, in an aggregate principal amount not to exceed the amount set forth opposite such Original Term Loan Lender's name on Schedule II; collectively, as to all such Original Term Loan Lenders, the "Original Term Loan Commitments". "Original Term Loan Facility" shall mean the Original Term Loan Commitments and the provisions herein related to the Original Term Loans. "Original Term Loan Lender" shall mean each bank or other financial institution from time to time party hereto which holds an Original Term Loan Commitment or an Original Term Loan; collectively, the "Original Term Loan Lenders". 2 "Original Term Loan Percentage" shall mean, at any date with respect to each Original Term Loan Lender, the percentage which the aggregate outstanding principal amount of such Original Term Loan Lender's Original Term Loans at such date constitutes of the aggregate outstanding principal amount of Original Term Loans of all Original Term Loan Lenders at such date. (b) Section 1.1 of the Credit Agreement is hereby amended by amending and restating the definitions of "Aggregate Term Loan Commitment", "Term Loan Commitment", "Term Loan Facility", "Term Loan" and "Term Loan Percentage" in their entirety as follows, respectively: "Aggregate Term Loan Commitment" shall mean, at any time, the aggregate amount of the Aggregate Original Term Loan Commitments and the Aggregate Additional Term Loan Commitments then in effect. "Term Loan Commitment" shall mean, with respect to any Term Loan Lender, the Original Term Loan Commitments and the Additional Term Loan Commitments of such Term Loan Lender. "Term Loan Facility" shall mean each of the Original Term Loan Facility and the Additional Term Loan Facility. "Term Loan" shall mean any Original Term Loan or any Additional Term Loan; collectively, the "Term Loans". "Term Loan Percentage" shall mean, at any date with respect to each Term Loan Lender, the percentage which the aggregate outstanding principal amount of such Term Loan Lender's Term Loans at such date constitutes of the aggregate outstanding principal amount of Term Loans of all Term Loan Lenders at such date. (c) The definition of "EBITDA" in Section 1.1 of the Credit Agreement is hereby amended by (i) replacing the word "and" at the end of clause (b)(xv) thereof with ",", (ii) adding the word "and" at the end of clause (b)(xvi) thereof and (iii) adding the following as a new clause (b)(xvii) thereof: "(xvii) non-recurring restructuring charges and returns charges in an aggregate amount with respect to all charges under this clause (xvii) not to exceed $25,000,000 during the term of this Agreement in respect of organizational realignments and related costs and returns costs due to retail space reconfigurations and/or product discontinuances (specifically identified and itemized by the Company at the time taken, whether or not characterized as a non-recurring or restructuring charge in accordance with GAAP)". (d) Section 2.1 of the Credit Agreement is hereby amended by amending and restating such section in its entirety as follows: "Section 2.1 Term Loan Commitments. (a) Subject to the terms and conditions of this Agreement, each Original Term Loan Lender severally made term loans in Dollars (individually, an "Original Term Loan"; collectively, the "Original Term Loans") to the Company under the Original Term Loan Commitments on the Closing Date in an amount equal to such Original Term Loan Lender's Original Term Loan Commitment. 3 (b) Subject to the terms and conditions of this Agreement, each Additional Term Loan Lender severally agrees to make term loans in Dollars (individually, an "Additional Term Loan"; collectively, the "Additional Term Loans") to the Company under the Additional Term Loan Commitments, which Additional Term Loans shall be made in a single drawing on the Amendment No. 2 Effective Date; provided, however, that the aggregate outstanding amount of the Additional Term Loans made by any Additional Term Loan Lender shall not exceed such Additional Term Loan Lender's Additional Term Loan Commitment. (c) The Term Loans may from time to time be (a) Eurodollar Loans, (b) Alternate Base Rate Loans or (c) a combination thereof, as determined by the Company and notified to the Term Loan Administrative Agent in accordance with Section 2.3 and 7.7. Amounts borrowed under this Section 2.1 and repaid or prepaid may not be reborrowed. All optional and mandatory prepayments of the Term Loans pursuant to this Agreement shall be applied pro rata between the Original Term Loans and the Additional Term Loans." (e) Section 2.3 of the Credit Agreement is hereby amended by (i) renumbering the existing paragraph (b) thereof as paragraph (c) and (ii) adding as a new paragraph (b) thereof the following: "(b) The Company may request a borrowing under the Additional Term Loan Commitments on the Amendment No. 2 Effective Date, subject to Section 2.1, by submitting an irrevocable Notice of Borrowing to the Term Loan Administrative Agent, which notice shall specify (i) the aggregate principal amount to be borrowed, (ii) the Amendment No. 2 Effective Date, (iii) whether the Additional Term Loans to be borrowed are to be Eurodollar Loans or Alternate Base Rate Loans or a combination thereof and, if a combination, the respective aggregate amount of each type of borrowing and (iv) if the Additional Term Loans to be borrowed are Eurodollar Loans, the length of the Interest Period or Interest Periods applicable thereto. Any such Notice of Borrowing must be received by the Term Loan Administrative Agent prior to 11:00 a.m., New York City time, three Working Days prior to the requested borrowing date, in the case of Eurodollar Loans, and one Business Day prior to the requested borrowing date, in the case of Alternate Base Rate Loans. Upon receipt of any such notice, the Term Loan Administrative Agent will promptly notify each Additional Term Loan Lender thereof. Each Additional Term Loan Lender will make available to the Term Loan Administrative Agent in immediately available funds at the office of the Term Loan Administrative Agent specified in Section 14.2 (or at such other location as the Term Loan Administrative Agent may direct), by 1:00 P.M., New York City time, on the Amendment No. 2 Effective Date an amount equal to the Additional Term Loan Percentage of such Additional Term Loan Lender multiplied by the aggregate principal amount of the Additional Term Loans requested to be made on the Amendment No. 2 Effective Date in Dollars, in funds immediately available to the Term Loan Administrative Agent. The proceeds of the Additional Term Loans received by the Term Loan Administrative Agent hereunder on the applicable borrowing date shall promptly be made available to the Company by the Term Loan Administrative Agent's crediting the account of the Company designated to the Term Loan Administrative Agent with the aggregate amount actually received by the Term Loan Administrative Agent from the Additional Term Loan Lenders and in like funds as received by the Term Loan Administrative Agent." 4 (f) Section 2.4(a) of the Credit Agreement is hereby amended by (i) amending all references therein of "Term Loans" to "Original Term Loans", (ii) amending all references therein of "Term Loan Lender" to "Original Term Loan Lender" and (iii) amending all references therein of "Term Loan Percentage" to "Original Term Loan Percentage"." (g) Section 2.4 of the Credit Agreement is hereby amended by (i) renumbering the existing paragraph (b) thereof as paragraph (c) and (ii) adding as a new paragraph (b) thereof the following: "(b) The Additional Term Loans of each Additional Term Loan Lender shall mature in 16 consecutive quarterly installments, each of which shall be in an amount equal to such Additional Term Loan Lender's Additional Term Loan Percentage multiplied by the amount set forth below opposite such installment (as such amounts may be reduced from time to time in accordance with Section 7.2(b) or 7.4(d)): Installment Principal Amount ----------- ---------------- October 15, 2006 $252,525.25 January 15, 2007 $252,525.25 April 15, 2007 $252,525.25 July 15, 2007 $252,525.25 October 15, 2007 $252,525.25 January 15, 2008 $252,525.25 April 15, 2008 $252,525.25 July 15, 2008 $252,525.25 October 15, 2008 $252,525.25 January 15, 2009 $252,525.25 April 15, 2009 $252,525.25 July 15, 2009 $252,525.25 5 Installment Principal Amount ----------- ---------------- October 15, 2009 $252,525.25 January 15, 2010 $252,525.25 April 15, 2010 $252,525.25 Term Loan Maturity Date $96,212,121.25" (h) Section 2.5 of the Credit Agreement is hereby amended by (i) amending all references therein of "Term Loans" to "Original Term Loans" and (ii) adding at the end of such section the following: "The proceeds of the Additional Term Loans hereunder shall be used by the Company for general corporate purposes not prohibited hereunder." (i) Section 7.3(g) of the Credit Agreement is hereby amended and restated in its entirety to read as follows: "(g) Upon the borrowing of Term Loans pursuant to Section 2.1, the Term Loan Commitment of each Term Loan Lender shall be automatically and permanently reduced in the amount of the Term Loan made by each Term Loan Lender pursuant to such borrowing. The Aggregate Original Term Loan Commitment, if any, shall terminate on the Closing Date after the funding of the Original Term Loans. The Aggregate Additional Term Loan Commitment, if any, shall terminate on the Amendment No. 2 Effective Date after the funding of the Additional Term Loans." (j) Section 11.1(a) of the Credit Agreement is hereby amended and restated in its entirety to read as follows: "(a) Senior Secured Leverage Ratio. Permit the Senior Secured Leverage Ratio of the Company and its Subsidiaries for the period of four consecutive fiscal quarters of the Company ending during any period set forth below to be more than the amount set forth opposite such period: Senior Secured Period Leverage Ratio ------ --------------- December 31, 2004 through 5.50 to 1.00 June 30, 2007 September 30, 2007 and each 5.00 to 1.00" fiscal quarter thereafter (k) Article XII of the Credit Agreement is hereby amended by (i) adding "or" at the end of clause (s) thereof and (ii) adding the following as a new clause (t) thereof: 6 "(t) Additional Equity Offerings. (i) The aggregate commitments by the M&FH Lenders to provide the M&FH Loans to the Company (whether such commitments are funded or unfunded) shall be less than $87,000,000 at any time during the period from the Amendment No. 2 Effective Date to the date on which Revlon shall have consummated one or more Equity Offerings after the Amendment No. 2 Effective Date generating at least $75,000,000 in gross proceeds and made Capital Contributions to the Company in an amount equal to the Net Proceeds in respect thereof (provided that no such Equity Offering shall be required hereunder), or (ii) the Company shall fail to apply any Capital Contributions referred to in clause (i) above promptly after its receipt thereof to repurchase, repay, defease or redeem any Subordinated Notes or other Indebtedness for borrowed money of the Company scheduled to mature prior to the Term Loan Maturity Date, including, without limitation, repayment of outstanding Multi-Currency Loans without any corresponding permanent reduction in the Aggregate Multi-Currency Commitment;" (l) The Annex C attached to this Amendment is hereby added to the Credit Agreement as a new Schedule IIA thereto. 3. Conditions to Effectiveness of this Amendment. This Amendment shall become effective as of the date the following conditions precedent have been satisfied (the "Effective Date"): (a) The Administrative Agents shall have received (i) this Amendment, duly executed and delivered by the Company and the Administrative Agents, (ii) the Consent and Affirmation, in the form attached hereto as Annex A, duly executed and delivered by each of the Guarantors, and (iii) Lender Consents, in the form attached hereto as Annex B (the "Lender Consent"), duly executed and delivered by Lenders constituting the Required Lenders. (b) The Administrative Agents shall have received written commitments duly executed by existing Lenders (or their Affiliates or Related Funds) or other Eligible Assignees in an aggregate amount equal to the amount of the proposed Aggregate Additional Term Loan Commitments and, in the case of each such Eligible Assignee that is not an existing Lender, an assumption agreement in form and substance satisfactory to the Administrative Agents and duly executed by the Company, the Administrative Agents and such Eligible Assignee. (c) The Administrative Agents shall have received certified copies of resolutions of the Board of Directors of the Company and each Guarantor approving the execution, delivery and performance of this Amendment and the other documents to be executed in connection herewith. (d) The Administrative Agents shall have received a favorable opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP, counsel for the Company and each Guarantor, addressed to the Administrative Agents, the Collateral Agent, the Lenders and the Issuing Lenders and in form and substance reasonably satisfactory to the Administrative Agents. (e) The Administrative Agents shall have received from the applicable title insurance company bring-down endorsements to each of the title insurance policies issued pursuant to the terms of the Credit Agreement insuring the continued first priority Lien of the Collateral Agent for the benefit of the Multi-Currency Secured Parties (as defined in the Pledge and Security Agreement) and the continued second priority Lien of the Collateral Agent for the benefit of the Term Loan Secured Parties (as defined in the Pledge and Security Agreement) on each of the Mortgaged Properties pursuant to the Mortgages, subject only to Customary Permitted Liens, and otherwise in form and substance reasonably satisfactory to the Administrative Agents. 7 (f) The Administrative Agents shall have received a solvency certificate from the Chief Financial Officer of the Company, in form and substance reasonably satisfactory to the Administrative Agents. (g) The Term Loan Administrative Agent shall have received a duly executed Notice of Borrowing from the Company. (h) The Administrative Agents shall have received (i) all accrued and unpaid interest on the Term Loans (immediately prior to giving effect to this Amendment), together with any amounts payable pursuant to Section 7.11 of the Credit Agreement and (ii) all fees and expenses (including reasonable fees and expenses of counsel) due and payable on or before the Effective Date, to the extent such fees and expenses have been invoiced at least one Business Day prior to the Effective Date. (i) (i) The Term Loan Administrative Agent shall have received from the Company, for the ratable benefit of the Term Loan Lenders that have delivered a Lender Consent on or prior to 12:00 noon (New York time) on July 21, 2006, an amendment fee equal to 0.125% of each such Term Loan Lender's Term Loan Percentage of the aggregate principal amount of Term Loans outstanding on the Effective Date (immediately prior to giving effect to this Amendment) and (ii) the Multi-Currency Administrative Agent shall have received from the Company, for the ratable benefit of the Multi-Currency Lenders that have delivered a Lender Consent on or prior to 12:00 noon (New York time) on July 21, 2006, an amendment fee equal to 0.125% of each such Multi-Currency Lender's Multi-Currency Percentage of the Aggregate Multi-Currency Commitment on the Effective Date; provided, that, in the case of clauses (i) and (ii), the Additional Term Loans are made by the Additional Term Loan Lenders on the Effective Date. (j) Prior to and after giving effect to this Amendment, each of the representations and warranties made by any Loan Party in or pursuant to the Loan Documents shall be true and correct in all material respects on and as of the date hereof, as if made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date. (k) No Default or Event of Default shall have occurred and be continuing on the date hereof prior to or after giving effect to this Amendment. 8 4. Representations and Warranties. The Company hereby represents and warrants to the Administrative Agents and the Lenders, on and as of the date hereof, both prior to and after giving effect to this Amendment, that: (a) (i) The Company has taken all necessary action to authorize the execution, delivery and performance of this Amendment, (ii) this Amendment has been duly executed and delivered by the Company and (iii) this Amendment is the legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and by general equitable principles. (b) Each of the representations and warranties made by any Loan Party in or pursuant to the Loan Documents is true and correct in all material respects on and as of the date hereof, as if made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties are true and correct in all material respects as of such earlier date. (c) No Default or Event of Default has occurred and is continuing. 5. Continuing Effect. Except as expressly set forth in this Amendment, all of the terms and provisions of the Credit Agreement are and shall remain in full force and effect and the Company shall continue to be bound by all of such terms and provisions. This Amendment is limited to the specific provisions of the Credit Agreement specified herein and shall not constitute an amendment of, or an indication of the Administrative Agents' or the Lenders' willingness to amend or waive, any other provisions of the Credit Agreement or the same provisions for any other date or purpose. 6. Expenses. The Company agrees to pay and reimburse each Administrative Agent for all its reasonable out-of-pocket costs and expenses incurred in connection with the negotiation, preparation, execution and delivery of this Amendment, and all other documents prepared in connection herewith, and the transactions contemplated hereby, including, without limitation, reasonable fees and disbursements and other charges of counsel to the Administrative Agents. 7. Choice of Law. This Amendment and the rights and obligations of the parties hereto shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York. 8. Counterparts. This Amendment may be executed in any number of counterparts and by different parties and separate counterparts, each of which when so executed and delivered, shall be deemed an original, and all of which, when taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment. 9. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof. 9 10. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 11. Loan Document. This Amendment is a Loan Document. 12. Waiver of Jury Trial. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AMENDMENT AND ANY OTHER LOAN DOCUMENT. [SIGNATURE PAGES FOLLOW] 10 IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written. REVLON CONSUMER PRODUCTS CORPORATION By: /s/ Robert K. Kretzman --------------------------------- Name: Robert K. Kretzman Title: Executive Vice President, General Counsel & Chief Legal Officer CITICORP USA, INC., as Term Loan Administrative Agent and Multi-Currency Administrative Agent By: /s/ William Washburn --------------------------------- Name: William Washburn Title: Director/Vice President -----END PRIVACY-ENHANCED MESSAGE-----