Lifetime Brands, Inc. entered into Amendment No. 2 to amend that certain Loan Agreement, dated as of March 2, 2018, among the Company, as borrower, the other loan parties from time to time party thereto, the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent and adding Manufacturers and Traders Trust Company, as syndication agent (the ?Term Loan Agreement?). In connection with the Amendment, the Company borrowed on its asset based loan facility $48.7 million to make a voluntary prepayment of principal on the Tranche B Term Loans and approximately $9.0 million to pay the original issue discount, related fees and expenses.

The Amendment, among other things, converted the Company's remaining Tranche B Term Loans to Extended Term Loans in an outstanding principal amount of $150.0 million and with a maturity of August 26, 2027 (?Extended Term Loan?). The Extended Term Loan will be repaid, commencing March 31, 2024, in quarterly payments of principal each equal to 1.25% of the original aggregate principal amount of the Extended Term Loan with the remaining balance payable on the maturity date. The Extended Term Loan requires the Company to make an annual prepayment of principal, shortly after delivery of the Company?s audited financial statements, beginning with those for the fiscal year ending December 31, 2024, based upon a percentage of the Company?s excess cash flow, (?Excess Cash Flow?), if any.

The percentage applied to the Company?s excess cash flow is based on the Company?s Total Net Leverage Ratio (as defined in the Amendment). When an Excess Cash Flow payment is required, each lender has the option to decline a portion or all of the prepayment amount payable to it. Per the Extended Term Loan, when the Company makes an Excess Cash Flow prepayment, the payment is first applied to satisfy the next eight (8) scheduled future quarterly required payments of the Extended Term Loan in order of maturity and then to the remaining scheduled installments on a pro rata basis.

The Extended Term Loan bears interest, at the Company?s option, at one of the following rates: (i) alternate base rate, defined, for any day, as the greater of (x) the prime rate, (y) a federal funds and overnight bank funding based rate plus 0.5% or (z) one-month Adjusted Term SOFR, but not less than 1.0%, plus 1.0%, plus a margin of 4.5% or (ii) Adjusted Term SOFR (Term SOFR plus the Term SOFR Adjustment) for the applicable interest period, but not less than 1.0%, plus a margin of 5.5%. As a result of the Amendment, the Company must comply with a financial covenant that it will not permit the Total Net Leverage Ratio (as defined in the Amendment), determined as of the end of each of its fiscal quarters ending on or after December 31, 2023, to be greater than 5.00 to 1.00.