HELEN OF TROY LTD, 10-Q, 1997-01-14

HELEN OF TROY LTD
10-Q, 1997-01-14
ELECTRIC HOUSEWARES & FANS

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<PAGE> 1

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q

X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
- --- SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 30, 1996

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
- --- SECURITIES EXCHANGE ACT OF 1934
For the transition period from...........to.............

Commission file number 0-23312

HELEN OF TROY LIMITED
(Exact name of registrant as specified in its charter)

Bermuda 74-2692550
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

6827 Market Avenue
El Paso, TX. 79915
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (915) 779-6363

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes X No
--- ---

As of January 10, 1997 there were 13,093,662 shares of Common Stock, $.10
Par Value, outstanding.
<PAGE> 2
HELEN OF TROY LIMITED AND SUBSIDIARIES

INDEX

<TABLE>
<CAPTION>
Page No.
<S> <C>
PART I. FINANCIAL INFORMATION

Item 1 Consolidated Condensed Balance
------
Sheets as of November 30, 1996 and
February 29, 1996 .......................... 3

Consolidated Condensed Statements
of Income for the Three and Nine
Months Ended November 30, 1996 and
November 30, 1995 .......................... 5

Consolidated Condensed Statements
of Cash Flows for the Nine Months
ended November 30, 1996 and
November 30, 1995 .......................... 6

Notes to Consolidated Condensed
Financial Statements ....................... 8

Item 2 Management's Discussion and Analysis of
------
Financial Condition and Results of
Operations ................................. 10

PART II. OTHER INFORMATION

Item 6 Exhibits and Reports on Form 8-K ............... 13
------

SIGNATURES ...................................................... 14

</TABLE>

2
<PAGE> 3
PART I. FINANCIAL INFORMATION

HELEN OF TROY LIMITED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands, except shares)

<TABLE>
<CAPTION>
November 30, February 29,
1996 1996
------------ ------------
(unaudited)
<S> <C> <C>
Assets

Current Assets:
Cash and cash equivalents $ 14,506 $ 44,195
Receivables - principally trade,
less allowance for doubtful
receivables of $1,470 at November 30,
1996 and $390 at February 29, 1996 64,231 28,854
Inventories 62,765 48,572
Prepaid expenses 748 422
Deferred income tax benefits 1,850 823
-------- --------

Total current assets 144,100 122,866

Property and equipment
net of accumulated depreciation of
$3,784 at November 30, 1996 and $3,229
at February 29, 1996 24,092 15,750

License agreements, at cost, less
amortization of $6,928 at November 30,
1996 and $6,361 at February 29, 1996 10,124 8,191

Note receivable 577 1,006

Other assets, net of amortization 14,812 6,775
-------- --------

Total assets $193,705 $154,588
======== ========
</TABLE>

(continued)

3
<PAGE> 4
HELEN OF TROY LIMITED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands, except shares)

<TABLE>
<CAPTION>
November 30, February 29,
1996 1996
---------- --------
(unaudited)
<S> <C> <C>
Liabilities and Stockholders' Equity

Current liabilities:
Notes payable $ 8,801 $ 2,593
Accounts payable, principally trade 5,098 1,005
Accrued expenses:
Advertising and promotional 7,694 1,740
Other 9,176 4,912
Income taxes payable 5,522 2,010
-------- --------

Total current liabilities 36,291 12,260

Long-term debt 40,450 40,450
-------- --------

Total liabilities 76,741 52,710

Stockholders' equity:
Cumulative preferred stock, non-voting,
$1.00 par value. Authorized 2,000,000
shares; none issued -- --
Common stock, $.10 par value
Authorized 25,000,000 shares;
issued and outstanding, 13,093,162 shares
at November 30, 1996 and 12,965,162
shares at February 29, 1996 1,309 648
Additional paid-in-capital 25,987 25,863
Retained earnings 89,668 75,367
-------- --------

Total stockholders' equity 116,964 101,878
-------- --------

Commitments and contingencies (Note 2) -- --

Total liabilities and stockholders' equity $193,705 $154,588
======== ========
</TABLE>

See accompanying notes to consolidated condensed financial statements.

4
<PAGE> 5
HELEN OF TROY LIMITED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(unaudited)
(in thousands, except shares and earnings per share)

<TABLE>
<CAPTION>
For the Three Months For the Nine Months
Ended November 30, Ended November 30,
1996 1995 1996 1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net sales $ 74,477 $ 55,353 $ 168,804 $ 131,579
Cost of sales 46,143 34,389 105,445 80,894
------------ ------------ ------------ ------------
Gross profit 28,334 20,964 63,359 50,685
Selling, general and administrative expenses 18,278 12,992 44,553 35,766
------------ ------------ ------------ ------------
Operating income 10,056 7,972 18,806 14,919

Other income (expense):
Interest (expense) (311) (489) (1,777) (1,159)
Interest income 245 161 1,215 537
Other, net 83 53 211 (87)
------------ ------------ ------------ ------------

Total other income (expense) 17 (275) (351) (709)
------------ ------------ ------------ ------------
Earnings before income taxes 10,073 7,697 18,455 14,210
Income tax expense (benefit):
Current 2,935 2,278 5,176 3,949
Deferred (667) (555) (1,023) (752)
------------ ------------ ------------ ------------

Net earnings $ 7,805 $ 5,974 $ 14,302 $ 11,013
============ ============ ============ ============

Net earnings per common and common
equivalent share (Note 3) - Primary $ .56 $ .45 $ 1.04 $ .82

Weighted average number of common and common
equivalent shares used in computing net
earnings per share -
Primary 13,964,888 13,334,122 13,776,155 13,379,166
</TABLE>

See accompanying notes to consolidated condensed financial statements.

5
<PAGE> 6
HELEN OF TROY LIMITED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)

<TABLE>
<CAPTION>
Nine Months Ended
November 30
1996 1995
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 14,302 $ 11,013
Adjustments to reconcile net income
to net cash used by operating activities:
Depreciation and amortization 1,902 1,601
Provision for doubtful receivables 1,080 (20)
Deferred tax benefit (1,027) (752)
Changes in operating assets and liabilities:
Receivables (36,457) (26,330)
Inventories (14,193) (4,093)
Prepaid expenses (326) (654)
Accounts payable 4,093 242
Accrued expenses 10,218 5,065
Income taxes payable 3,512 2,810
-------- --------
Net cash used by operating activities (16,896) (11,118)

Cash flows from investing activities:
Capital and license expenditures (11,398) (3,943)
Other assets (8,816) 714
Collection on note receivable 429 360
-------- --------

Net cash used by investing activities (19,785) (2,869)

</TABLE>
(continued)

6
<PAGE> 7
HELEN OF TROY LIMITED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)

<TABLE>
<CAPTION>
Nine Months Ended
November 30,
1996 1995
-------- --------
<S> <C> <C>
Cash flows from financing activities:
Net borrowings on notes payable $ 6,208 $ 8,718
Proceeds from exercise of options and warrants 784 156
-------- --------

Net cash provided by financing activities 6,992 8,874
-------- --------

Net decrease in cash and cash equivalents (29,689) (5,113)
-------- --------

Cash and cash equivalents, beginning of period 44,195 31,917
-------- --------
Cash and cash equivalents, end of period $ 14,506 $ 26,804
======== ========

Supplemental cash flow disclosures:
Interest paid $ 2,241 $ 1,065
Income taxes paid 1,728 690
</TABLE>

See accompanying notes to consolidated condensed financial statements.

7
<PAGE> 8
HELEN OF TROY LIMITED AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

November 30, 1996

Note 1 - In the opinion of the Company, the accompanying consolidated
condensed financial statements contain all adjustments
(consisting of only normal recurring adjustments) necessary to
present fairly its financial condition and the results of its
operations for the periods ended November 30, 1996 and 1995.
While the Company believes that the disclosures presented are
adequate to make the information not misleading, it is
suggested that these statements be read in conjunction with
the financial statements and the notes included in the
Company's latest annual report on Form 10-K.

Note 2 - The Company is involved in various claims and legal actions
arising in the ordinary course of business. In the opinion of
management, the ultimate disposition of such claims and legal
actions will not have a material adverse effect on the
financial position of the Company.

As of November 30, 1996, the Company has unused advertising
credits, with a carrying amount of $2,198,000 which are
available until used. Benefits to be received by the Company
from utilization of all remaining credits could exceed the
carrying amount. In July 1995, the company which is obligated
to provide advertising in connection with the credits (the
Bankrupt Entity) filed a voluntary Chapter 11 petition in the
United States Bankruptcy Court (Court). Through December 2,
1996, a plan of reorganization had not been filed in the
bankruptcy proceedings and the Court had not ruled as to the
treatment of the Company's advertising credits. Management
has been informed that counsel for the Bankrupt Entity has
petitioned in Court for approval to classify or treat these
barter credits as executory contracts. If the Court
determines that barter credits are executory contracts and the
Bankrupt Entity emerges from Chapter 11, the Company could
realize the full value of the barter credits. In the event
the Court rules that the advertising credits represent
unsecured liabilities of the Bankrupt Entity, the value of the
advertising credits to the Company would be reduced
significantly, and therefore, this reduction in the value of
the advertising credits would be charged against income in the
fiscal quarter in which that determination were made. The
loss of these credits to the Company would have no impact on
the liquidity or the future operations of the Company. The
ultimate outcome of the bankruptcy proceeding cannot currently
be determined.

(continued)

8
<PAGE> 9

Note 3 - Primary earnings per common and common equivalent share is
computed based upon the weighted average number of common
shares plus common share equivalents (dilutive stock options
and warrants) outstanding during the period. Fully diluted
earnings per share is based on the weighted average number of
common shares plus common share equivalents determined on the
basis of maximum potential dilution from stock options and
warrants. Earnings per common and common equivalent share,
assuming full dilution, is not materially dilutive for any of
the periods presented.

Note 4 - The business of the Company is seasonal with greater than 60%
of annual sales volume normally occurring in the second and
third fiscal quarters.

Note 6 - During September 1996, the Company's U.S. subsidiary and the
Internal Revenue Service (IRS) completed a settlement which
closes all tax years up to and including the year ended
February 28, 1993. Additionally, the settlement with the IRS
is applicable to certain types of foreign source income for
the year ended February 28, 1994. As discussed in the
Company's February 29, 1996 annual report on Form 10-K, all
payments made with respect to the settlement had been provided
for in previous years.

Note 7 - On October 4, 1996 the Company acquired the assets of two
personal care lines of the Dazey Corp., of Kansas City,
Missouri. Included in the purchase are certain inventories,
designs, equipment, tooling, license rights and trademarks for
existing products bearing the Dazey, Carel and Dr. Scholl's
trade names.

9
<PAGE> 10

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

Results of Operations

Quarter ended November 30, 1996

Net sales increased $19,124,000 during the three-month period ended November
30, 1996, a 34.5% increase when compared with the quarter ended November 30,
1995. Excluding the effect of sales attributed to the purchase of new lines of
business in Oct. 1996, the Company's increase in sales was 24%. That increase
is attributable to increased market share. Gains were registered in both the
consumer sales division and the professional salon division. Hair care
appliance sales make up the great majority of consumer products division
volume. The introduction of new hair care appliance models, increased brush
and comb sales, and sales of hair care accessories were the primary causes of
the market share increase.

The Company's gross profit margin for the quarter ended November 30, 1996 was
38%, which is comparable with the Company's gross profit margin for the quarter
ended November 30, 1995. The lines of business acquired in October 1996
experienced lower than normal gross profit margins in the quarter. The
exclusion of these sales and cost of goods sold for the quarter would result in
a gross profit margin of 38.7% for the quarter ended November 30, 1996.

Selling, general and administrative expenses increased as a percentage of sales
to 24.5% in the quarter ended November 30, 1996 as compared to 23.5% for the
same quarter in 1995. This increase was primarily related to the
transitioning, to the Company, of manufacturing and operating costs associated
with the Company's acquisition of assets.

Interest paid during the quarter ended November 30, 1996, increased over
interest expense for the same quarter in the previous year due to the
$40,000,000 in senior notes issued by the Company's US subsidiary in January,
1996. The issuance of those notes, net of payment of outstanding bank loans,
resulted in increased investments in short term securities, which increased
interest income.

Nine-month period ended November 30, 1996

Net sales increased $37,225,000 for the nine-month period ended November 30,
1996, when compared with the same period in 1995. The reason for the 28%
increase is discussed above.

(continued)

10
<PAGE> 11
The Company's gross profit margin for the nine-month period ended November 30,
1996, decreased to 37.5% from 38.5% for the nine-month period ended November
30, 1995. The higher gross profit rate of the prior year was above the normal
rate, which is in line with the fiscal 1997 rate of 37.5%.

Selling, general and administrative expenses decreased slightly to 26.4% during
the nine-month period ended November 30, 1996, when compared with 27% for the
same period during 1995.

Interest expense for the nine-month period ended November 30, 1996, increased
over interest expense for the nine-month period ended November 30, 1995, due to
the $40,000,000 in senior notes issued by the Company's US subsidiary in
January, 1996. The issuance of those notes, net of payment of outstanding bank
loans, resulted in increased investments in short term securities, which
increased interest income.

Liquidity and Capital Resources

Cash and cash equivalents declined to $14,506,000 at November 30, 1996 from
$44,195,000 at February 29, 1996, primarily due to the seasonal increase in
accounts receivable and inventory balances and also to the use of internal
funds to finance the construction of a new company owned distribution facility.
Also, the Company acquired the assets of two personal care lines of the Dazey
Corp., of Kansas City, Missouri. The purchase price was made from internal
funds.

Receivables increased to $64,231,000 at November 30, 1996 from $28,854,000 at
February 29, 1996, and inventory increased to $62,765,000 at November 30, 1996
from $48,572,000 at February 29, 1996. These increases relate to the seasonal
increase in sales in the third fiscal quarter as compared to the fourth fiscal
quarter and to the growth in sales.

The Company's working capital was $107,809,000 at November 30, 1996 and the
current ratio was 4 to 1. Short term debt increased $6,208,000 from February
29, 1996 to November 30, 1996.

In December 1996, the Company's U.S. subsidiary negotiated a shelf, long-term
debt facility. The new long-term debt facility provides for an additional $40
million. As of the filing date of this report, no funds have been drawn on this
facility.

The Company believes its capital resources are adequate to finance all
anticipated funding requirements. Additionally, the Company believes that
funds are available to finance the construction of a central distribution
facility, which accounts for the increase in property and equipment from
February 29, 1996 to November 30, 1996.

(continued)

11
<PAGE> 12
Contingencies

Management has been informed that counsel for the Bankrupt Entity has
petitioned in Court for approval to classify or treat these barter credits as
executory contracts. If the Court determines that barter credits are executory
contracts and the Bankrupt Entity emerges from Chapter 11, the Company could
realize the full value of the barter credits. In the event the Court rules
that the advertising credits represent unsecured liabilities of the Bankrupt
Entity, the value of the advertising credits to the Company would be reduced
significantly, and therefore, this reduction in the value of the advertising
credits would be charged against income in the fiscal quarter in which that
determination were made. The loss of these credits to the company would have
no impact on the liquidity or the future operations of the Company. The
ultimate outcome of the bankruptcy proceeding cannot currently be determined.

12
<PAGE> 13

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits:

11 Computation of Per Share Earnings

10.23 Amended and Restated Note Purchase, Guaranty and Master Shelf
Agreement, $40,000,000 7.01% Guaranteed Senior Notes and
$40,000,000 Guaranteed Senior Note Facility.

27 Financial Data Schedule

13
<PAGE> 14

SIGNATURES

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 thereunto duly authorized.

HELEN OF TROY LIMITED
---------------------
(Registrant)

Date January 10, 1997 s/Gerald J. Rubin
----------------------- ----------------------------------
Gerald J. Rubin
Chairman of the Board and
Chief Executive Officer
(Principal Executive Officer)

Date January 10, 1997 s/Sam L. Henry
----------------------- ----------------------------------
Sam L. Henry
Senior Vice-President, Finance,
and Chief Financial Officer
(Principal Financial Officer)
<PAGE> 15
INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>

11 Computation of Per Share Earnings

10.23 Amended and Restated Note Purchase, Guaranty and Master Shelf
Agreement, $40,000,000 7.01% Guaranteed Senior Notes and
$40,000,000 Guaranteed Senior Note Facility.

27 Financial Data Schedule
</TABLE>

<PAGE> 1

Exhibit 11

HELEN OF TROY LIMITED AND SUBSIDIARIES
COMPUTATION OF PER SHARE EARNINGS

<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
November 30, November 30,
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Primary Earnings per Share:
Weighted average number of
common shares outstanding 13,114,185 12,961,072 13,015,119 12,902,120

Increase in weighted average
number of common shares outstanding
due to options and warrants 850,703 373,050 761,036 477,046

Weighted average number of
common shares outstanding, as adjusted 13,964,888 13,334,122 13,776,155 13,379,166

Net earnings $ 7,805,000 $ 5,974,000 $14,302,000 $11,013,000

Net earnings per common and
common equivalent share $ .56 $ .45 $ 1.04 $ .82

Fully Diluted Earnings per Share:
Weighted average number of
common shares outstanding 13,114,185 12,961,072 13,015,119 12,902,120

Increase in weighted average
number of common shares outstanding
due to options and warrants 1,102,989 376,116 901,880 513,396

Weighted average number of
common shares outstanding, as adjusted 14,217,174 13,337,188 13,916,999 13,415,516

Net earnings $ 7,805,000 $ 5,974,000 $14,302,000 $11,013,000

Net earnings per share,
assuming full dilution $ .55 $ .45 $ 1.03 $ .82
</TABLE>

<PAGE> 1
================================================================================

HELEN OF TROY L.P.
HELEN OF TROY TEXAS CORPORATION
HELEN OF TROY LIMITED (BERMUDA)
HELEN OF TROY LIMITED (BARBADOS)
HELEN OF TROY NEVADA CORPORATION
HOT NEVADA INC.

$40,000,000 7.01% Guaranteed Senior Notes, Series 1996-A, due January 5, 2008
$40,000,000 Guaranteed Senior Note Facility

____________________

AMENDED AND RESTATED NOTE PURCHASE,
GUARANTY AND MASTER SHELF AGREEMENT

____________________

Dated as of December 31, 1996

Note: This Agreement contains confidentiality
obligations (Section 22) and restrictions
on transfer (Section 15.3).

================================================================================
<PAGE> 2
TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. AUTHORIZATION OF ISSUE OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1. Authorization of Issue of Series 1996-A Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2. Authorization of Issue of Shelf Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

2. ASSUMPTION; EXCHANGE OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.1. Assumption of Original Note Agreement and Original Notes . . . . . . . . . . . . . . . . . . . . . . . 3
2.2. Exchange of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

3. PURCHASE AND SALE OF SHELF NOTES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.1. Facility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.2. Issuance Period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.3. Periodic Spread Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.4. Request for Purchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.5. Rate Quotes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.6. Acceptance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.7. Market Disruption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.8. Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.9. Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

4. CONDITIONS TO INITIAL CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.1. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.2. Performance; No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.3. Compliance Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.4. Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.5. Exchange Permitted By Applicable Law, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.6. Payment of Special Counsel Fees, Structuring Fee and Accrued Interest . . . . . . . . . . . . . . . 11
4.7. Private Placement Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.8. Changes in Corporate Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.9. Proceedings and Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

5. CONDITIONS TO CLOSINGS WITH RESPECT TO SHELF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.1. Delivery of Accepted Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.2. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.3. Performance; No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.4. Compliance Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.5. Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.6. Issuance and Sale Permitted By Applicable Law, etc. . . . . . . . . . . . . . . . . . . . . . . . . 13
</TABLE>

-i-
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
5.7. Private Placement Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.8. Changes in Corporate Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.9. Proceedings and Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

6. REPRESENTATIONS AND WARRANTIES OF
THE HELEN OF TROY ENTITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
6.1. Transfer of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
6.2. Organization; Power and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
6.3. Authorization, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.4. Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.5. Organization and Ownership of Shares of Subsidiaries; Affiliates . . . . . . . . . . . . . . . . . . 16
6.6. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.7. Compliance with Laws, Other Instruments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.8. Governmental Authorizations, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.9. Litigation; Observance of Agreements, Statutes and Orders . . . . . . . . . . . . . . . . . . . . . 17
6.10. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.11. Title to Property; Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.12. Licenses, Permits, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.13. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.14. Private Offering by the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.15. Existing Indebtedness; Future Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.16. Foreign Assets Control Regulations, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.17. Status under Certain Statutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.18. Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.19. Rank of Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.20. Existing Restricted Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.21. No Hostile Tender Offer; Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

7. REPRESENTATIONS OF THE PURCHASER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
7.1. Purchase for Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
7.2. Source of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

8. INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8.1. Financial and Business Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8.2. Officer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
8.3. Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
</TABLE>

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9. PREPAYMENTS AND PURCHASES OF THE NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
9.1. Required Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
9.2. Required Prepayments of Shelf Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.3. Optional Prepayments with Make-Whole Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.4. Offer to Prepay, With Make-Whole Amount, From Asset Sale Proceeds . . . . . . . . . . . . . . . . . 29
9.5. Allocation of Partial Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.6. Conditional Right to Put Upon Change of Control. . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.7. Option to Prepay Due to Tax Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
9.8. Maturity; Surrender, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
9.9. Purchase of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
9.10. Make-Whole Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

10. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.1. Compliance with Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.2. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.3. Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
10.4. Payment of Taxes and Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
10.5. Corporate Existence, Licenses and Permits, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . 35
10.6. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
10.7. Covenant to Secure Notes Equally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

11. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
11.1. Financial Covenants, Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
11.2. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
11.3. Disposition of Proceeds of Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
11.4. Change of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.5. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.6. Merger, Consolidation, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.7. Restricted Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
11.8. Transfer of Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

12. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

13. REMEDIES ON DEFAULT, ETC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
13.1. Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
13.2. Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
13.3. Rescission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
13.4. No Waivers or Election of Remedies, Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . 46
</TABLE>

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14. GUARANTY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
14.1. Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
14.2. Guaranty of Payment and Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
14.3. General Provisions Relating to The Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

15. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
15.1. Registration of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
15.2. Transfer and Exchange of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
15.3. Prohibited Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
15.4. Replacement of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

16. PAYMENTS ON NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
16.1. Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
16.2. Home Office Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

17. EXPENSES, ETC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
17.1. Transaction Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
17.2. Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

18. SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

19. AMENDMENT AND WAIVER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
19.1. Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
19.2. Solicitation of Holders of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
19.3. Binding Effect, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
19.4. Notes held by Guarantors, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

20. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

21. REPRODUCTION OF DOCUMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

22. CONFIDENTIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

23. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
23.1. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
23.2. Payments Due on Non-Business Days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
23.3. Withholding Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
23.4. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
</TABLE>

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23.5. Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
23.6. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
23.7. Binding Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
23.8. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
23.9. Additional Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
23.10. Consent to Jurisdiction; Service of Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
23.11. Maximum Interest Payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

</TABLE>

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SCHEDULE A -- INFORMATION SCHEDULE
SCHEDULE B -- DEFINED TERMS
SCHEDULE 4.8 -- Changes in Corporate Structure
SCHEDULE 6.1 -- Transferred Assets and Liabilities
SCHEDULE 6.4 -- Disclosure Materials
SCHEDULE 6.5 -- Subsidiaries of Ultimate Parent and
Ownership of Subsidiary Stock
SCHEDULE 6.9 -- Certain Litigation
SCHEDULE 6.12 -- Patents, etc.
SCHEDULE 6.13 -- ERISA Affiliates and Plans
SCHEDULE 6.15 -- Existing Indebtedness
SCHEDULE 6.20 -- Existing Restricted Investments

EXHIBIT 1-A -- Form of Series 1996-A Note
EXHIBIT 1-B -- Form of Shelf Note
EXHIBIT 2 -- Request for Purchase
EXHIBIT 3 -- Confirmation of Acceptance
EXHIBIT 4.4(a) -- Form of Opinion of United States Counsel for the
Helen of Troy Entities
EXHIBIT 4.4(b) -- Form of Opinion of Bermuda Counsel for Ultimate Parent
EXHIBIT 4.4(c) -- Form of Opinion of Barbados Counsel for HOT-Barbados
EXHIBIT 9.6 -- Form of Notice of Sale

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<PAGE> 8
AMENDED AND RESTATED NOTE
PURCHASE, GUARANTY AND MASTER SHELF AGREEMENT

This AMENDED AND RESTATED NOTE PURCHASE, GUARANTY AND MASTER
SHELF AGREEMENT (the "AGREEMENT") is entered into as of December 31, 1996 among
Helen of Troy L.P., a Texas limited partnership (the "COMPANY"), Helen of Troy
Texas Corporation, a Texas corporation formerly named Helen of Troy Corporation
("HOT-TEXAS"), Helen of Troy Limited, a Bermudian company ("ULTIMATE PARENT"),
Helen of Troy Limited, a Barbadian company ("HOT-BARBADOS"), Helen of Troy
Nevada Corporation, a Nevada corporation ("GENERAL PARTNER"), HOT Nevada Inc.,
a Nevada corporation ("LIMITED PARTNER") (collectively referred to herein as
the "HELEN OF TROY ENTITIES"), and The Prudential Insurance Company of America
(referred to herein as "PRUDENTIAL" or the "EXISTING HOLDER"). The parties
hereto agree as follows:

WITNESSETH

WHEREAS, HOT-Texas, Ultimate Parent and the Existing Holder
entered into that certain Note Purchase and Guaranty Agreement dated January 5,
1996 (the "ORIGINAL NOTE AGREEMENT") pursuant to which HOT-Texas issued and
sold to the Existing Holder its 7.01% Guaranteed Senior Notes dated January 5,
1996 in the aggregate principal amount of $40,000,000 (the "ORIGINAL NOTES");

WHEREAS, pursuant to Section 13 of the Original Agreement,
Ultimate Parent guaranteed the payment of the Original Notes and the
performance of the obligations of HOT-Texas pursuant to the Original Note
Agreement;

WHEREAS, pursuant to that certain Guaranty dated as of January
19, 1996, HOT-Barbados guaranteed the payment of the Original Notes and the
performance of the obligations of HOT-Texas pursuant to the Original Note
Agreement (the "BARBADOS GUARANTY");

WHEREAS, HOT-Barbados is a wholly-owned subsidiary of Ultimate
Parent, and HOT-Texas is a wholly-owned subsidiary of HOT-Barbados;

WHEREAS, General Partner and Limited Partner are both
wholly-owned subsidiaries of HOT-Texas;

WHEREAS, General Partner owns a 1% partnership interest in the
Company as a general partner, and Limited Partner owns a 99% partnership
interest in the Company as a limited partner;

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<PAGE> 9
WHEREAS, the Helen of Troy Entities and the Existing Holder
have agreed that (a) the Company will assume the obligations of HOT-Texas under
the Original Note Agreement and the Original Notes, (b) in connection with such
assumption, the Existing Holder will surrender the Original Notes for notes of
the Company in substance of like terms as the Original Notes surrendered and of
like unpaid principal amount, and (c) the Original Note Agreement will be
amended and restated in its entirety to reflect, among other things, the
assumption of the Original Notes by the Company and the creation of a
$40,000,000 guaranteed senior note shelf facility;

WHEREAS, the Barbados Guaranty and the guaranty of Ultimate
Parent contained in SECTION 13 of the Original Agreement will continue in full
force and effect and the terms thereof shall be incorporated into this
Agreement;

WHEREAS, the Company will be the issuer of the guaranteed
senior notes under the aforementioned $40,000,000 guaranteed senior note shelf
facility;

WHEREAS, the Helen of Troy Entities (other than the Company)
will guarantee the notes issued in exchange for the Original Notes and the
guaranteed senior notes to be issued under the aforementioned $40,000,000
guaranteed senior note shelf facility;

NOW, THEREFORE, in order to accomplish the matters
contemplated by the preceding recitals and in consideration of the mutual
premises herein contained and for other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Original Note Agreement is
hereby amended and restated as follows:

1. AUTHORIZATION OF ISSUE OF NOTES.

1.1. AUTHORIZATION OF ISSUE OF SERIES 1996-A NOTES.

To evidence the Company's assumption of the obligations of
HOT-Texas under the Original Notes pursuant to SECTION 2.1, the Company has
authorized the issue of its guaranteed senior promissory notes (the "SERIES
1996-A NOTES") in the aggregate principal amount of $40,000,000, to be dated
December 31, 1996, to mature on January 5, 2008, to bear interest on the unpaid
balance thereof from the date thereof until the principal thereof shall have
become due and payable at the rates specified in the Series 1996-A Notes, and
on overdue principal, Make-Whole Amount and interest at the rates specified in
the Series 1996-A Notes, and to be substantially in the form of EXHIBIT 1-A
attached hereto. The term "SERIES 1996-A NOTES" as used herein shall include
each Series 1996-A Note delivered pursuant to any provision of this Agreement
and each Series 1996-A Note delivered in substitution or exchange for any such
Series 1996-A Note pursuant to any such provision. As provided in SECTION 14
and, with respect to Ultimate Parent and HOT-Barbados, in continuance of their
respective guaranties of the Original Notes, the payment of the Series 1996-A
Notes and the performance by the Company of all of its obligations hereunder
with

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<PAGE> 10
respect thereto are absolutely, irrevocably, unconditionally, jointly and
severally guaranteed by the Guarantors.

Capitalized terms used herein have the meanings specified in
SCHEDULE B; references to a "SCHEDULE" or "EXHIBIT" are, unless otherwise
specified, to a Schedule or an Exhibit attached to this Agreement.

1.2. AUTHORIZATION OF ISSUE OF SHELF NOTES.

The Company will authorize the issue of its guaranteed senior
promissory notes (the "SHELF NOTES") in the aggregate principal amount of
$40,000,000, to be dated the date of issue thereof; to mature, in the case of
up to $20,000,000 in aggregate principal amount of Shelf Notes so issued, no
more than 15 years after the date of original issuance thereof and, in the case
of at least $20,000,000 in aggregate principal amount of such Shelf Notes no
more than 10 years after the date of original issue thereof; to have an average
life, in the case of up to $20,000,000 in aggregate principal amount of Shelf
Notes so issued, of no more than 13 years after the date of original issuance
thereof and, in the case of at least $20,000,000 in aggregate principal amount
of such Shelf Notes no more than 8 years after the date of original issue
thereof; to bear interest on the unpaid balance thereof from the date thereof
at the rate per annum, and to have such other particular terms, as shall be set
forth, in the case of each Shelf Note so issued, in the Confirmation of
Acceptance with respect to such Shelf Note delivered pursuant to SECTION 3.6;
and to be substantially in the form of EXHIBIT 1-B attached hereto. The term
"SHELF NOTES" as used herein shall include each Shelf Note delivered pursuant
to any provision of this Agreement and each Shelf Note delivered in
substitution or exchange for any such Shelf Note pursuant to any such
provision. Shelf Notes which have (i) the same final maturity, (ii) the same
installment payment dates, (iii) the same installment payment amounts (as a
percentage of the original principal amount of each Shelf Note), (iv) the same
interest rate, (v) the same interest payment periods, and (vi) the same
original date of issuance are herein called a "SERIES" of Shelf Notes. The
Series 1996-A Notes shall also constitute a "SERIES" of Notes. As provided in
SECTION 14, the payment of the Shelf Notes and the performance by the Company
of all of its obligations hereunder with respect thereto are absolutely,
irrevocably, unconditionally, jointly and severally guaranteed by the
Guarantors.

2. ASSUMPTION; EXCHANGE OF NOTES.

2.1. ASSUMPTION OF ORIGINAL NOTE AGREEMENT AND ORIGINAL NOTES.

Effective upon the Initial Date of Closing (as hereinafter
defined), the Company hereby expressly assumes the due and punctual payment of
the principal of, Make-Whole Amount if any, and interest on all the Original
Notes according to their tenor, and the due and punctual performance and
observance of all of the covenants and conditions to be performed by HOT-Texas
under the Original Note Agreement, as amended and restated hereby. Such
assumption shall not release HOT-Texas from its obligations under the Original
Notes and the Original Note Agreement,

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<PAGE> 11
as amended and restated hereby, and HOT-Texas shall remain liable with respect
thereto as a Guarantor pursuant to SECTION 14.

2.2. EXCHANGE OF NOTES.

To evidence the assumption contemplated by SECTION 2.1 and in
furtherance thereof, on December 31, 1996 (the "INITIAL CLOSING" or "INITIAL
DATE OF CLOSING"), the Company hereby agrees to issue the Series 1996-A Notes
and, subject to the terms and conditions herein set forth, the Existing Holder
agrees to exchange the Original Notes with the Company for the aggregate
principal amount of Series 1996-A Notes set forth opposite the Existing
Holder's name in SCHEDULE A attached hereto. The Company will deliver to the
Existing Holder, at the offices of Baker & Botts, L.L.P., at 800 Trammell Crow
Center, 2001 Ross Avenue, Dallas, Texas 75201, one or more Series 1996-A Notes
registered in the Existing Holder's name or (if so specified) in the name of
the Existing Holder's nominee, evidencing the aggregate principal amount of the
Original Notes to be exchanged by the Existing Holder and in the denomination
or denominations specified with respect to the Existing Holder in SCHEDULE A
attached hereto against delivery by the Existing Holder to the Company of the
Original Notes in the aggregate principal amount equal to the aggregate
principal of the Series 1996-A Notes to be issued to the Existing Holder on
the Initial Date of Closing. If at the Initial Closing the Company shall fail
to tender such Series 1996-A Notes to the Existing Holder as provided in this
SECTION 2.2, or any of the conditions specified in SECTION 4 shall not have
been fulfilled to the satisfaction of the Existing Holder, the Existing Holder
shall, at its election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights the Existing Holder may have by
reason of such failure or such nonfulfillment.

3. PURCHASE AND SALE OF SHELF NOTES.

3.1. FACILITY.

Prudential is willing to consider, in its sole discretion and within
limits which may be authorized for purchase by Prudential and Prudential
Affiliates from time to time, the purchase of Shelf Notes pursuant to this
Agreement. The willingness of Prudential to consider such purchase of Shelf
Notes is herein called the "FACILITY". At any time, the aggregate principal
amount of Shelf Notes stated in SECTION 1.2, minus the aggregate principal
amount of Shelf Notes purchased and sold pursuant to this Agreement prior to
such time, minus the aggregate principal amount of Accepted Notes (as
hereinafter defined) which have not yet been purchased and sold hereunder prior
to such time is herein called the "AVAILABLE FACILITY AMOUNT" at such time.
NOTWITHSTANDING THE WILLINGNESS OF PRUDENTIAL TO CONSIDER PURCHASES OF SHELF
NOTES, THIS AGREEMENT IS ENTERED INTO ON THE EXPRESS UNDERSTANDING THAT NEITHER
PRUDENTIAL NOR ANY PRUDENTIAL AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT
OFFERS TO PURCHASE SHELF NOTES, OR TO QUOTE RATES, SPREADS OR OTHER

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<PAGE> 12
TERMS WITH RESPECT TO SPECIFIC PURCHASES OF SHELF NOTES, AND THE FACILITY SHALL
IN NO WAY BE CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL
AFFILIATE.

3.2. ISSUANCE PERIOD.

Shelf Notes may be issued and sold pursuant to this Agreement until
the earlier of (i) the second anniversary of the date of this Agreement (or if
any such anniversary is not a Business Day, the Business Day next preceding
such anniversary) and (ii) the thirtieth day after Prudential shall have given
to the Company, or the Company shall have given to Prudential, a notice stating
that it elects to terminate the issuance and sale of Shelf Notes pursuant to
this Agreement (or if such thirtieth day is not a Business Day, the Business
Day next preceding such thirtieth day). The period during which Shelf Notes
may be issued and sold pursuant to this Agreement is herein called the
"ISSUANCE PERIOD".

3.3. PERIODIC SPREAD INFORMATION.

Provided no Default or Event of Default exists, not later than 9:30
A.M. (New York City local time) on a Business Day during the Issuance Period if
there is an Available Facility Amount on such Business Day, the Company may
request by telecopier or telephone, and Prudential will, to the extent
reasonably practicable, provide to the Company on such Business Day (or, if
such request is received after 9:30 A.M. (New York City local time) on such
Business Day, on the following Business Day), information (by telecopier or
telephone) with respect to various spreads at which Prudential or Prudential
Affiliates might be interested in purchasing Shelf Notes of different average
lives; provided, however, that the Company may not make such requests more
frequently than once in every five Business Days or such other period as shall
be mutually agreed to by the Company and Prudential. The amount and content of
information so provided shall be in the sole discretion of Prudential but it is
the intent of Prudential to provide information which will be of use to the
Company in determining whether to initiate procedures for use of the Facility.
Information so provided shall not constitute an offer to purchase Shelf Notes,
and neither Prudential nor any Prudential Affiliate shall be obligated to
purchase Shelf Notes at the spreads specified. Information so provided shall
be representative of potential interest only for the period commencing on the
day such information is provided and ending on the earlier of the fifth
Business Day after such day and the first day after such day on which further
spread information is provided. Prudential may suspend or terminate providing
information pursuant to this SECTION 3.3 if, in its sole discretion, it
determines that there has been an adverse change in the credit quality of the
Company, or Ultimate Parent and its Subsidiaries taken as a whole, after the
date of this Agreement.

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<PAGE> 13
3.4. REQUEST FOR PURCHASE.

The Company may from time to time during the Issuance Period make
requests for purchases of Shelf Notes (each such request being a "REQUEST FOR
PURCHASE"). Each Request for Purchase shall be made to Prudential by
telecopier and confirmed by nationwide overnight delivery service, and shall
(i) specify the aggregate principal amount of Shelf Notes covered thereby,
which shall not be less than $5,000,000 and not be greater than the Available
Facility Amount at the time such Request for Purchase is made, (ii) specify the
principal amounts, final maturities, installment payment dates and amounts and
interest payment periods (quarterly or semi-annual in arrears) of the Shelf
Notes covered thereby, (iii) specify the use of proceeds of such Shelf Notes,
(iv) specify the proposed day for the closing of the purchase and sale of such
Shelf Notes, which shall be a Business Day during the Issuance Period not less
than 10 days and not more than 20 days after the making of such Request for
Purchase, (v) specify the number of the account and the name and address of the
depository institution to which the purchase prices of such Shelf Notes are to
be transferred on the Closing Day for such purchase and sale, (vi) certify that
the representations and warranties contained in SECTION 6 are true on and as of
the date of such Request for Purchase except to the extent of changes caused by
the transactions herein contemplated and that there exists on the date of such
Request for Purchase no Event of Default or Default, and (vii) be substantially
in the form of EXHIBIT 2 attached hereto. Each Request for Purchase shall be
in writing and shall be deemed made when received by Prudential.

3.5. RATE QUOTES.

Not later than five Business Days after the Company shall have given
Prudential a Request for Purchase pursuant to SECTION 3.4, Prudential may
provide (by telephone promptly thereafter confirmed by telecopier, in each case
no earlier than 9:30 A.M. and no later than 2:00 P.M. New York City local time)
interest rate quotes for the several principal amounts, maturities, installment
payment schedules, and interest payment periods of Shelf Notes specified in
such Request for Purchase. Each quote shall represent the interest rate per
annum payable on the outstanding principal balance of such Shelf Notes until
such balance shall have become due and payable, at which Prudential or a
Prudential Affiliate would be willing to purchase such Shelf Notes at 100% of
the principal amount thereof.

3.6. ACCEPTANCE.

Within 30 minutes after Prudential shall have provided any interest
rate quotes pursuant to SECTION 3.5 or, in the event that due to conditions in
the market place it shall not be feasible to hold such interest rate quotes
open 30 minutes, such shorter period as Prudential may specify to the Company
(such period being the "ACCEPTANCE WINDOW"), the Company may, subject to
SECTION 3.7, elect to accept such interest rate quotes as to not less than
$5,000,000 aggregate principal amount of the Shelf Notes specified in the
related Request for Purchase. Such election shall be made by an Authorized
Officer of the Company notifying Prudential by telephone or telecopier

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<PAGE> 14
within the Acceptance Window (but not earlier than 9:30 A.M. or later than 2:00
P.M., New York City local time) that the Company elects to accept such interest
rate quotes, specifying the Shelf Notes (each such Shelf Note being an
"ACCEPTED NOTE") as to which such acceptance (an "ACCEPTANCE") relates. The
day the Company notifies an Acceptance with respect to any Accepted Notes is
herein called the "ACCEPTANCE DAY" for such Accepted Notes. Any interest rate
quotes as to which Prudential does not receive an Acceptance within the
Acceptance Window shall expire, and no purchase or sale of Shelf Notes
hereunder shall be made based on such expired interest rate quotes. Subject to
SECTION 3.7 and the other terms and conditions hereof, the Company agrees to
sell to Prudential or a Prudential Affiliate, and Prudential agrees to
purchase, or to cause the purchase by a Prudential Affiliate of, the Accepted
Notes at 100% of the principal amount of such Shelf Notes. As soon as
practicable following the Acceptance Day, the Company, Prudential and each
Prudential Affiliate which is to purchase any such Accepted Notes will execute
a confirmation of such Acceptance substantially in the form of EXHIBIT 3
attached hereto (a "CONFIRMATION OF ACCEPTANCE").

3.7. MARKET DISRUPTION.

Notwithstanding the provisions of SECTION 3.6, if Prudential shall
have provided interest rate quotes pursuant to SECTION 3.5 and thereafter prior
to the time an Acceptance with respect to such quotes shall have been notified
to Prudential in accordance with SECTION 3.6 there shall occur a general
suspension, material limitation, or significant disruption of trading in
securities generally on the New York Stock Exchange or in the market for U.S.
Treasury securities and other financial instruments, then such interest rate
quotes shall expire, and no purchase or sale of Shelf Notes hereunder shall be
made based on such expired interest rate quotes. If the Company thereafter
notifies Prudential of the Acceptance of any such interest rate quotes, such
Acceptance shall be ineffective for all purposes of this Agreement, and
Prudential shall promptly notify the Company that the provisions of this
SECTION 3.7 are applicable with respect to such Acceptance.

3.8. CLOSING.

3.8.1 SHELF CLOSINGS.

Not later than 11:30 A.M. (New York City local time) on the Closing
Day for any Accepted Notes, the Company will deliver to each Purchaser listed
in the Confirmation of Acceptance relating thereto at the offices of Prudential
Capital Group, Texas Commerce Tower, 2200 Ross Avenue, Suite 4200 E, Dallas,
Texas 75201, the Accepted Notes to be purchased by such Purchaser in the form
of one or more Shelf Notes in authorized denominations as such Purchaser may
request for each Series of Accepted Notes to be purchased on the Closing Day,
dated the Closing Day and registered in such Purchaser's name (or in the name
of its nominee), against payment of the purchase price thereof by transfer of
immediately available funds for credit to the Company's account specified in
the Request for Purchase of such Notes.

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<PAGE> 15
3.8.2 RESCHEDULED CLOSINGS.

If the Company fails to tender to any Purchaser the Accepted Notes to
be purchased by such Purchaser on the scheduled Closing Day for such Accepted
Notes as provided above in this SECTION 3.8, or any of the conditions specified
in SECTION 5 shall not have been fulfilled by the time required on such
scheduled Closing Day, the Company shall, prior to 1:00 P.M. (New York City
local time) on such scheduled Closing Day, notify such Purchaser in writing
whether (x) such closing is to be rescheduled (such rescheduled date to be a
Business Day during the Issuance Period not less than one Business Day and not
more than 30 Business Days after such scheduled Closing Day) (the "RESCHEDULED
CLOSING DAY") and certify to such Purchaser that the Company reasonably
believes that it will be able to comply with the conditions set forth in
SECTION 5 on such Rescheduled Closing Day and that the Company will pay the
Delayed Delivery Fee in accordance with SECTION 3.9.2 or (y) such closing is to
be canceled as provided in SECTION 3.9.3. In the event that the Company shall
fail to give such notice referred to in the preceding sentence, such Purchaser
may at its election, at any time after 1:00 P.M. (New York City local time) on
such scheduled Closing Day, notify the Company in writing that such closing is
to be canceled as provided in SECTION 3.9.3.

3.9. FEES.

3.9.1 FACILITY FEE.

The Company will pay to Prudential in immediately available funds a
fee (the "FACILITY FEE") on each Closing Day, in an amount equal to 0.15% of
the aggregate principal amount of Notes sold on such Closing Day; provided,
that no Facility Fee shall be payable on the initial Closing Day in respect of
up to $12,000,000 aggregate principal amount of Shelf Notes sold on such
Closing Day.

3.9.2 DELAYED DELIVERY FEE.

If the closing of the purchase and sale of any Accepted Note is
delayed for any reason beyond the original Closing Day for such Accepted Note,
the Company will pay to Prudential on the Cancellation Date or actual closing
date of such purchase and sale (if such Cancellation Date or closing date
occurs on a date later than the date specified in the Confirmation of
Acceptance for such Accepted Note), a fee (the "DELAYED DELIVERY FEE")
calculated as follows:

(BEY - MMY) X DTS/360 X PA

where "BEY" means Bond Equivalent Yield, i.e., the bond equivalent yield per
annum of such Accepted Note, "MMY" means Money Market Yield, i.e., the yield
per annum on an alternative investment selected by Prudential on the date
Prudential receives notice of the delay in the closing for such Accepted Notes
having a maturity date or dates the same as, or closest to, the Rescheduled

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<PAGE> 16
Closing Day or Rescheduled Closing Days (a new alternative investment being
selected by Prudential each time such closing is delayed); "DTS" means Days to
Settlement, i.e., the number of actual days elapsed from and including the
originally scheduled Closing Day with respect to such Accepted Note (in the
case of the first such payment with respect to such Accepted Note) or from and
including the date of the next preceding payment (in the case of any subsequent
delayed delivery fee payment with respect to such Accepted Note) to but
excluding the date of such payment; and "PA" means Principal Amount, i.e., the
principal amount of the Accepted Note for which such calculation is being made.
In no case shall the Delayed Delivery Fee be less than zero. Nothing contained
herein shall obligate any Purchaser to purchase any Accepted Note on any day
other than the Closing Day for such Accepted Note, as the same may be
rescheduled from time to time in compliance with SECTION 3.8.

3.9.3 CANCELLATION FEE

If the Company at any time notifies Prudential in writing that the
Company is canceling the closing of the purchase and sale of any Accepted Note,
or if Prudential notifies the Company in writing under the circumstances set
forth in the last sentence of SECTION 3.8.2 that the closing of the purchase
and sale of such Accepted Note is to be canceled, or if the closing of the
purchase and sale of such Accepted Note is not consummated on or prior to the
last day of the Issuance Period (the date of any such notification, or the last
day of the Issuance Period, as the case may be, being the "CANCELLATION DATE"),
the Company will pay Prudential in immediately available funds an amount (the
"CANCELLATION FEE") calculated as follows:

PI X PA

where "PI" means Price Increase, i.e., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential) of the Hedge Treasury Note(s) on the Cancellation Date over the bid
price (as determined by Prudential) of the Hedge Treasury Notes(s) on the
Acceptance Day for such Accepted Note by (b) such bid price; and "PA" has the
meaning specified in SECTION 3.9.2. The foregoing bid and ask prices shall be
as reported by Telerate Systems, Inc. (or, if such data for any reason ceases
to be available through Telerate Systems, Inc., any publicly available source
of similar market data). Each price shall be based on a U.S. Treasury security
having a par value of $100.00 and shall be rounded to the second decimal place.
In no case shall the Cancellation Fee be less than zero.

4. CONDITIONS TO INITIAL CLOSING.

The obligation of the Existing Holder to exchange the Original
Notes for the Series 1996-A Notes at the Initial Closing is subject to the
fulfillment to the satisfaction of the Existing Holder, prior to or at the
Initial Closing, of the following conditions:

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<PAGE> 17
4.1. REPRESENTATIONS AND WARRANTIES.

The representations and warranties of the Helen of Troy
Entities in this Agreement shall be correct when made and at the time of the
Initial Closing.

4.2. PERFORMANCE; NO DEFAULT.

Each of the Helen of Troy Entities shall have performed and
complied with all agreements and conditions contained in this Agreement
required to be performed or complied with by it prior to or at the Initial
Closing, and after giving effect to the exchange of the Original Notes for the
Series 1996-A Notes no Default or Event of Default shall have occurred and be
continuing. Neither Ultimate Parent nor any Subsidiary shall have entered into
any transaction since January 5, 1996 that would have been prohibited by
SECTION 11 had such Section applied since such date.

4.3. COMPLIANCE CERTIFICATES.

(a) Officer's Certificate. Each of the Helen of Troy
Entities shall have delivered to the Existing Holder an Officer's Certificate,
dated the date of the Initial Closing, certifying that the conditions specified
in SECTIONS 4.1, 4.2 and 4.8 applicable to it have been fulfilled.

(b) Secretary's Certificate. Each of the Helen of Troy
Entities shall have delivered to the Existing Holder a certificate certifying
as to the resolutions attached thereto and other corporate or partnership
proceedings relating to the authorization, execution and delivery of the Series
1996-A Notes and this Agreement.

4.4. OPINIONS OF COUNSEL.

The Existing Holder shall have received opinions in form and
substance satisfactory to the Existing Holder, dated the date of the Initial
Closing (a) from Baker & McKenzie, United States counsel for the Helen of Troy
Entities, substantially in the form of EXHIBIT 4.4(A) and covering such other
matters incident to the transactions contemplated hereby as the Existing Holder
or its counsel may reasonably request (and the Helen of Troy Entities hereby
instruct their counsel to deliver such opinion to the Existing Holder), (b)
from Conyers, Dill & Pearman, Bermuda counsel for Ultimate Parent,
substantially in the form of EXHIBIT 4.4(B) and covering such other matters
incident to the transactions contemplated hereby as the Existing Holder or its
counsel may reasonably request (and Ultimate Parent hereby instructs its
counsel to deliver such opinion to the Existing Holder), (c) from Carrington &
Sealy, Barbados counsel for HOT-Barbados, substantially in the form of EXHIBIT
4.4(C) and covering such other matters incident to the transactions
contemplated hereby as the Existing Holder or its counsel may reasonably
request (and HOT-Barbados hereby instructs its counsel to deliver such opinion
to the Existing Holder), and (d) from Baker & Botts, L.L.P., special counsel to
the Existing Holder in connection with such transactions, in form, scope and
substance satisfactory to the Existing Holder.

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<PAGE> 18
4.5. EXCHANGE PERMITTED BY APPLICABLE LAW, ETC.

On the date of the Initial Closing the exchange of the
Original Notes for the Series 1996-A Notes shall (i) be permitted by the laws
and regulations of each jurisdiction to which the Existing Holder is subject,
without recourse to provisions (such as Section 1405(a)(8) of the New York
Insurance Law) permitting limited investments by insurance companies without
restriction as to the character of the particular investment, (ii) not violate
any applicable law or regulation (including, without limitation, Regulation G,
T or X of the Board of Governors of the Federal Reserve System) and (iii) not
subject the Existing Holder to any tax, penalty or liability under or pursuant
to any applicable law or regulation, which law or regulation was not in effect
on the date hereof. If requested by the Existing Holder, the Existing Holder
shall have received from any of the Helen of Troy Entities an Officer's
Certificate certifying as to such matters of fact as the Existing Holder may
reasonably specify to enable the Existing Holder to determine whether such
exchange is so permitted.

4.6. PAYMENT OF SPECIAL COUNSEL FEES, STRUCTURING FEE AND ACCRUED
INTEREST.

Without limiting the provisions of SECTION 17.1, the Company
shall have paid on or before the Initial Closing the fees, charges and
disbursements of the special counsel referred to in SECTION 4.4 to the extent
reflected in a statement of such counsel rendered to the Company or Ultimate
Parent at least one Business Day prior to the Initial Closing. On or prior to
the Initial Date of Closing, the Company shall have paid the Existing Holder in
immediately available funds (a) a structuring fee of $15,000 and (b) interest
accrued and unpaid in respect of the Original Notes to (but excluding) the
Initial Date of Closing.

4.7. PRIVATE PLACEMENT NUMBER.

A Private Placement number issued by Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of the
National Association of Insurance Commissioners) shall have been obtained for
the Series 1996-A Notes.

4.8. CHANGES IN CORPORATE STRUCTURE.

Except as specified in SCHEDULE 4.8, none of the Helen of Troy
Entities shall have changed its respective jurisdiction of incorporation or
organization or been a party to any merger or consolidation and none of the
Helen of Troy Entities shall have succeeded to all or any substantial part of
the liabilities of any other entity, at any time following the date of the most
recent financial statements referred to in the first sentence of SECTION 6.6.

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<PAGE> 19
4.9. PROCEEDINGS AND DOCUMENTS.

All corporate, partnership and other proceedings in connection
with the transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be satisfactory to the Existing
Holder and its special counsel, and the Existing Holder and its special counsel
shall have received all such counterpart originals or certified or other copies
of such documents as the Existing Holder or they may reasonably request.

5. CONDITIONS TO CLOSINGS WITH RESPECT TO SHELF NOTES.

The obligation of any Purchaser to purchase and pay for any
Accepted Notes is subject to the fulfillment to the satisfaction of such
Purchaser, on or before the Closing Day for such Accepted Notes, of the
following conditions:

5.1. DELIVERY OF ACCEPTED NOTES.

Such Purchaser shall have received the Accepted Note(s), dated
the applicable Closing Day, to be purchased by such Purchaser.

5.2. REPRESENTATIONS AND WARRANTIES.

The representations and warranties of the Helen of Troy
Entities in this Agreement shall be correct when made on the applicable Closing
Day.

5.3. PERFORMANCE; NO DEFAULT.

Each of the Helen of Troy Entities shall have performed and
complied with all agreements and conditions contained in this Agreement
required to be performed or complied with by it prior to or on the applicable
Closing Day, and after giving effect to the issuance and sale of the Accepted
Note(s) no Default or Event of Default shall have occurred and be continuing.
Neither Ultimate Parent nor any Subsidiary shall have entered into any
transaction since January 5, 1996 that would have been prohibited by SECTION 11
had such Section applied since such date.

5.4. COMPLIANCE CERTIFICATES.

(a) Officer's Certificate. Each of the Helen of Troy
Entities shall have delivered to such Purchaser an Officer's Certificate, dated
the applicable Closing Day, certifying that the conditions specified in
SECTIONS 5.1, 5.2 and 5.8 applicable to it have been fulfilled.

(b) Secretary's Certificate. Each of the Helen of Troy
Entities shall have delivered to such Purchaser a certificate certifying as to
the resolutions attached thereto and other

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<PAGE> 20
corporate or partnership proceedings relating to the authorization, execution
and delivery of the Accepted Note(s).

5.5. OPINIONS OF COUNSEL.

Such Purchaser shall have received opinions in form and
substance satisfactory to such Purchaser, dated the applicable Closing Day (a)
from Baker & McKenzie, United States counsel for the Helen of Troy Entities,
covering the matters set forth in EXHIBIT 4.4(A) applicable to the Facility
and covering such other matters incident to the transactions contemplated
hereby as such Purchaser or its counsel may reasonably request (and the Helen
of Troy Entities hereby instruct their counsel to deliver such opinion to such
Purchaser (each issuance and sale of any Accepted Notes shall constitute a
reaffirmation of such instruction)), (b) from Conyers, Dill & Pearman, Bermuda
counsel for Ultimate Parent, covering the matters set forth in EXHIBIT 4.4(B)
applicable to the Facility and covering such other matters incident to the
transactions contemplated hereby as such Purchaser or its counsel may
reasonably request (and Ultimate Parent hereby instructs its counsel to deliver
such opinion to such Purchaser (each issuance and sale of any Accepted Notes
shall constitute a reaffirmation of such instruction)), and (c) from Carrington
& Sealy, Barbados counsel for HOT-Barbados, covering the matters set forth in
EXHIBIT 4.4(C) applicable to the Facility and covering such other matters
incident to the transactions contemplated hereby as such Purchaser or its
counsel may reasonably request (and HOT-Barbados hereby instructs its counsel
to deliver such opinion to such Purchaser (each issuance and sale of any
Accepted Notes shall constitute a reaffirmation of such instruction)).

5.6. ISSUANCE AND SALE PERMITTED BY APPLICABLE LAW, ETC.

On the applicable Closing Day the issuance and sale of the
Accepted Note(s) shall (i) be permitted by the laws and regulations of each
jurisdiction to which such Purchaser is subject, without recourse to provisions
(such as Section 1405(a)(8) of the New York Insurance Law) permitting limited
investments by insurance companies without restriction as to the character of
the particular investment, (ii) not violate any applicable law or regulation
(including, without limitation, Regulation G, T or X of the Board of Governors
of the Federal Reserve System) and (iii) not subject such Purchaser to any tax,
penalty or liability under or pursuant to any applicable law or regulation,
which law or regulation was not in effect on the date hereof. If requested by
such Purchaser, such Purchaser shall have received from any of the Helen of
Troy Entities an Officer's Certificate certifying as to such matters of fact as
such Purchaser may reasonably specify to enable such Purchaser to determine
whether such purchase is so permitted.

5.7. PRIVATE PLACEMENT NUMBER.

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<PAGE> 21
5.8. CHANGES IN CORPORATE STRUCTURE.

5.9. PROCEEDINGS AND DOCUMENTS.

All corporate, partnership and other proceedings in connection
with the transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be satisfactory to such
Purchaser, and such Purchaser shall have received all such counterpart
originals or certified or other copies of such documents as such Purchaser or
they may reasonably request.

6. REPRESENTATIONS AND WARRANTIES OF THE HELEN OF TROY ENTITIES.

The Helen of Troy Entities jointly and severally represent and
warrant as follows:

6.1. TRANSFER OF ASSETS.

HOT-Texas has transferred all of its assets (other than those
described on Schedule 6.1 attached hereto) to General Partner and Limited
Partner, and General Partner and Limited Partner have assumed all of the
liabilities of HOT-Texas (other than those described on Schedule 6.1 attached
hereto). General Partner and Limited Partner have transferred such assets to
the Company, and the Company has assumed such liabilities.

6.2. ORGANIZATION; POWER AND AUTHORITY.

The Company is a limited partnership duly organized and
validly existing in good standing under the laws of the State of Texas.
General Partner and Limited Partner are both corporations duly organized and
validly existing in good standing under the laws of the State of Nevada.
Ultimate Parent and HOT-Barbados are companies duly organized and validly
existing in good standing under the laws of Bermuda and Barbados, respectively.
HOT-Texas is a corporation duly organized and validly existing in good standing
under the laws of the State of Texas. Each of the Helen of Troy Entities is
duly qualified as a foreign corporation, limited partnership or company, as the
case may be, and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which
the failure to be so qualified or in good standing could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
General Partner is a Wholly-Owned Subsidiary of Ultimate

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<PAGE> 22
Parent and the only general partner of the Company, and Limited Partner is a
Wholly-Owned Subsidiary of Ultimate Parent and the only limited partner of the
Company. The Company is a Wholly-Owned Subsidiary of Ultimate Parent. Each of
the Helen of Troy Entities has the corporate, company or partnership power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to transact, to
execute and deliver this Agreement and to perform the provisions thereof. The
Company has the partnership power and authority to execute and deliver the
Notes and to perform the provisions thereof.

6.3. AUTHORIZATION, ETC.

This Agreement and the Notes have been duly authorized by all
necessary corporate, company or partnership action on the part of each of the
Helen of Troy Entities party thereto, and this Agreement and the Notes,
constitute legal, valid and binding obligations of each of the Helen of Troy
Entities party thereto enforceable against such Helen of Troy Entities in
accordance with their respective terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

6.4. DISCLOSURE.

Except as disclosed in SCHEDULE 6.4, this Agreement, the
documents, certificates or other writings delivered to Purchaser by or on
behalf of any of the Helen of Troy Entities in connection with the transactions
contemplated hereby and the financial statements described in the first
sentence of SECTION 6.6 and those delivered under SECTION 8.1, taken as a
whole, do not contain any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made. Except as expressly
described in SCHEDULE 6.4, or in one of the documents, certificates or other
writings identified therein, or in the financial statements described in the
first sentence of SECTION 6.6, since January 5, 1996, there has been no change
in the financial condition, operations, business, properties or prospects of
any of the Helen of Troy Entities except changes that individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect.
There is no fact known to any of the Helen of Troy Entities that could
reasonably be expected to have a Material Adverse Effect that has not been set
forth herein or in this Agreement, or in the other documents, certificates and
other writings delivered to Purchaser by or on behalf of any of the Helen of
Troy Entities specifically for use in connection with the transactions
contemplated hereby.

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<PAGE> 23
6.5. ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES; AFFILIATES.

(a) SCHEDULE 6.5 contains (except as noted therein)
complete and correct lists of Ultimate Parent's Subsidiaries, showing, as to
each Subsidiary, the correct name thereof, the jurisdiction of its
organization, and the percentage of shares of each class of its capital stock
or similar equity interests outstanding owned by Ultimate Parent and each other
Subsidiary, of the Ultimate Parent's Affiliates other than Subsidiaries, and of
the Company's, General Partner's and Ultimate Parent's respective directors and
senior officers.

(b) All of the outstanding shares of capital stock or
similar equity interests of each Subsidiary shown in SCHEDULE 6.5 as being
owned by Ultimate Parent and its Subsidiaries have been validly issued, are
fully paid and nonassessable and are owned by Ultimate Parent or another
Subsidiary free and clear of any Lien (except as otherwise disclosed in
SCHEDULE 6.5.

(c) Each Subsidiary identified in SCHEDULE 6.5 is a
corporation or other legal entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and is duly
qualified as a foreign corporation or other legal entity and is in good
standing in each jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to be so qualified or in
good standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each such Subsidiary has the
corporate or other power and authority to own or hold under lease the
properties it purports to own or hold under lease and to transact the business
it transacts and proposes to transact.

(d) No Subsidiary is a party to, or otherwise subject to
any legal restriction or any agreement (other than this Agreement, the
agreements listed on SCHEDULE 6.5 and customary limitations imposed by
corporate law or partnership statutes) restricting the ability of such
Subsidiary to pay dividends out of profits or make any other similar
distributions of profits to Ultimate Parent or any of its Subsidiaries that
owns outstanding shares of capital stock or similar equity interests of such
Subsidiary.

6.6. FINANCIAL STATEMENTS; DISCLOSURE.

Ultimate Parent has delivered to the Existing Holder copies of
all financial statements required to be delivered by SECTION 7.1 of the
Original Note Agreement. All of said financial statements (including in each
case the related schedules and notes) fairly present in all material respects
the consolidated or consolidating, as the case may be, financial position of
Ultimate Parent and its Subsidiaries as of the dates thereof and the
consolidated or consolidating, as the case may be, results of their respective
operations and cash flows as of the dates thereof and have been prepared in
accordance with GAAP consistently applied throughout the periods involved
except as set forth in the notes thereto. Neither Ultimate Parent, the Company
nor any other Subsidiary has entered into any transaction since January 5, 1996
that would have been prohibited

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<PAGE> 24
by SECTION 11 had such Section applied since such date. Ultimate Parent has
delivered all of the financial statements required to be delivered pursuant to
SECTION 8.1 of this Agreement. All of said financial statements (including in
each case the related schedules and notes) fairly present in all material
respects the consolidated or consolidating, as the case may be, financial
position of Ultimate Parent and its Subsidiaries as of the dates thereof and
the consolidated or consolidating, as the case may be, results of their
operations and cash flows as of the dates thereof and have been prepared in
accordance with GAAP consistently applied throughout the periods involved
except as set forth in the notes thereto.

6.7. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.

The execution, delivery and performance by each of the Helen
of Troy Entities of this Agreement, and the execution, delivery and performance
by the Company of the Notes, will not, except where such has no Material
Adverse Effect, (i) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property
of Ultimate Parent or any Subsidiary under, any indenture, mortgage, deed of
trust, loan, purchase or credit agreement, lease, corporate charter,
partnership agreement, memorandum of association or by-laws, or any other
agreement or instrument to which Ultimate Parent or any Subsidiary is bound or
by which Ultimate Parent or any Subsidiary or any of their respective
properties may be bound or affected, (ii) conflict with or result in a breach
of any of the terms, conditions or provisions of any order, judgment, decree,
or ruling of any court, arbitrator or Governmental Authority applicable to
Ultimate Parent or any Subsidiary or (iii) violate any provision of any statute
or other rule or regulation of any Governmental Authority applicable to
Ultimate Parent or any Subsidiary.

6.8. GOVERNMENTAL AUTHORIZATIONS, ETC.

No consent, approval or authorization of, or registration,
filing or declaration with, any Governmental Authority is required in
connection with the execution, delivery or performance by each of the Helen of
Troy Entities of this Agreement or the execution, delivery or performance of
the Notes by the Company.

6.9. LITIGATION; OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS.

(a) Except as disclosed in SCHEDULE 6.9, there are no
actions, suits or proceedings pending or, to the knowledge of Ultimate Parent
or of any of the Helen of Troy Entities, threatened against or affecting
Ultimate Parent or any Subsidiary or any property of Ultimate Parent or any
Subsidiary in any court or before any arbitrator of any kind or before or by
any Governmental Authority that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

(b) Neither Ultimate Parent nor any Subsidiary is in
default under any term of any agreement or instrument to which it is a party or
by which it is bound, or any order, judgment,

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<PAGE> 25
decree or ruling of any court, arbitrator or Governmental Authority or is in
violation of any applicable law, ordinance, rule or regulation (including
without limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.

6.10. TAXES.

Ultimate Parent and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (i) the
amount of which is not individually or in the aggregate Material or (ii) the
amount, applicability or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which Ultimate Parent or a
Subsidiary, as the case may be, has established adequate reserves in accordance
with GAAP. None of the Helen of Troy Entities knows of any basis for any other
tax or assessment that could reasonably be expected to have a Material Adverse
Effect. The charges, accruals and reserves on the books of Ultimate Parent and
its Subsidiaries in respect of Federal, state or other taxes for all fiscal
periods are adequate. The Federal income tax liabilities of Ultimate Parent
and its Subsidiaries have been determined by the Internal Revenue Service and
paid for all fiscal years up to and including the fiscal year ended February
28, 1993.

6.11. TITLE TO PROPERTY; LEASES.

Ultimate Parent and its Subsidiaries have good and sufficient
title to their respective properties that individually or in the aggregate are
Material, including all such properties reflected (i) in the most recent
audited balance sheet delivered pursuant to SECTION 7.1 of the Original Note
Agreement or SECTION 8.1 of this Agreement, as the case may be, and, with
respect to the Initial Closing, the balance sheets referred to in SECTION 6.6,
or (ii) purported to have been acquired by Ultimate Parent or any Subsidiary
after said date (except as sold or otherwise disposed of in the ordinary course
of business), in each case free and clear of Liens prohibited by this
Agreement. All leases that individually or in the aggregate are Material are
valid and subsisting and are in full force and effect in all material respects.

6.12. LICENSES, PERMITS, ETC.

Except as disclosed in SCHEDULE 6.12,

(a) Ultimate Parent and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents, copyrights,
service marks, trademarks and trade names, or rights thereto, that
individually or in the aggregate are Material, without known conflict
with the rights of others;

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<PAGE> 26
(b) to the best knowledge of any of the Helen of Troy
Entities, no product of any of the Helen of Troy Entities infringes in
any Material respect any license, permit, franchise, authorization,
patent, copyright, service mark, trademark, trade name or other right
owned by any other Person; and

(c) to the best knowledge of any of the Helen of Troy
Entities, there is no Material violation by any Person of any right of
any of the Helen of Troy Entities with respect to any patent,
copyright, service mark, trademark, trade name or other right owned or
used by any of the Helen of Troy Entities.

6.13. COMPLIANCE WITH ERISA.

(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except for such
instances of noncompliance as have not resulted in and could not reasonably be
expected to result in a Material Adverse Effect. Neither the Company nor any
ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA
or the penalty or excise tax provisions of the Code relating to employee
benefit plans (as defined in section 3 of ERISA), and no event, transaction or
condition has occurred or exists that could reasonably be expected to result in
the incurrence of any such liability by the Company or any ERISA Affiliate, or
in the imposition of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate, in either case pursuant to Title I or IV of
ERISA or to such penalty or excise tax provisions or to section 401(a)(29) or
412 of the Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.

(b) The present value of the aggregate benefit liabilities
under each of the Plans (other than Multiemployer Plans), determined as of the
end of such Plan's most recently ended plan year on the basis of the actuarial
assumptions specified for funding purposes in such Plan's most recent actuarial
valuation report, did not exceed the aggregate current value of the assets of
such Plan allocable to such benefit liabilities. The term "BENEFIT
LIABILITIES" has the meaning specified in section 4001 of ERISA and the terms
"CURRENT VALUE" and "PRESENT VALUE" have the meaning specified in section 3 of
ERISA.

(c) The Company and its ERISA Affiliates have not incurred
withdrawal liabilities (and are not subject to contingent withdrawal
liabilities) under section 4201 or 4204 of ERISA in respect of Multiemployer
Plans that individually or in the aggregate are Material.

(d) The expected postretirement benefit obligation
(determined as of the last day of Ultimate Parent's most recently ended fiscal
year in accordance with Financial Accounting Standards Board Statement No. 106,
without regard to liabilities attributable to continuation coverage mandated by
section 4980B of the Code) of Ultimate Parent and its Subsidiaries is not
Material.

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<PAGE> 27
(e) The execution and delivery of this Agreement and the
issuance of the Notes hereunder will not involve any transaction that is
subject to the prohibitions of section 406 of ERISA or in connection with which
a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code.
SCHEDULE 6.13 sets forth the identities of all ERISA Affiliates and all
"EMPLOYEE BENEFIT PLANS" with respect to which the Company or any "AFFILIATE"
of the Company is a "PARTY-IN-INTEREST" or in respect of which the Notes could
constitute any employer security. In connection with the consummations of the
transactions on any Closing Day, the representation in the first sentence of
this SECTION 6.13(E) is made in reliance upon and subject to the accuracy of
the Purchaser's representation in SECTION 7.2 as to the sources of the funds to
be used to pay the purchase price of the Accepted Notes. The terms "EMPLOYEE
BENEFIT PLAN" and "PARTY-IN-INTEREST" have the meaning specified in section 3
of ERISA and "AFFILIATES" and "EMPLOYER SECURITY" have the meanings specified
in section 4.07(d) of ERISA.

6.14. PRIVATE OFFERING BY THE COMPANY.

None of the Helen of Troy Entities nor anyone acting on their
behalf has offered the Notes or any similar securities for sale to, or
solicited any offer to buy any of the same from, or otherwise approached or
negotiated in respect thereof with, any person other than Purchaser, which has
been offered the Notes at a private sale for investment. None of the Helen of
Troy Entities nor anyone acting on their behalf has taken, or will take, any
action that would subject the issuance of the Notes to the registration
requirements of Section 5 of the Securities Act.

6.15. EXISTING INDEBTEDNESS; FUTURE LIENS.

(a) Except as described therein, SCHEDULE 6.15 sets forth a
complete and correct list of all outstanding Indebtedness of Ultimate Parent
and its Subsidiaries as of November 30, 1996 since which date there has been no
Material change in the amounts, interest rates, sinking funds, installment
payments or maturities of the Indebtedness of Ultimate Parent or its
Subsidiaries. Neither Ultimate Parent nor any Subsidiary is in default and no
waiver of default is currently in effect, in the payment of any principal or
interest on any Indebtedness of Ultimate Parent or such Subsidiary and no event
or condition exists with respect to any Indebtedness of Ultimate Parent or any
Subsidiary that would permit (or that with notice or the lapse of time, or
both, would permit) one or more Persons to cause such Indebtedness to become
due and payable before its stated maturity or before its regularly scheduled
dates of payment.

(b) Except as disclosed in SCHEDULE 6.15, neither Ultimate
Parent nor any Subsidiary has agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of its property,
whether now owned or hereafter acquired, to be subject to a Lien not permitted
by SECTION 11.2.

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<PAGE> 28
6.16. FOREIGN ASSETS CONTROL REGULATIONS, ETC.

Neither the issuance of the Notes by the Company hereunder,
nor the guaranty of the Notes by the Guarantors, will violate the Trading with
the Enemy Act, as amended, or any of the foreign assets control regulations of
the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as
amended) or any enabling legislation or executive order relating thereto.

6.17. STATUS UNDER CERTAIN STATUTES.

Neither Ultimate Parent nor any Subsidiary is subject to
regulation under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 1935, as amended, the Interstate Commerce Act,
as amended, or the Federal Power Act, as amended.

6.18. ENVIRONMENTAL MATTERS.

Neither Ultimate Parent nor any Subsidiary has knowledge of
any claim or has received any notice of any claim, and no proceeding has been
instituted raising any claim against Ultimate Parent or any of its Subsidiaries
or any of their respective real properties now or formerly owned, leased or
operated by any of them or other assets, alleging any damage to the environment
or violation of any Environmental Laws, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect. Except as
otherwise disclosed to Purchaser in writing,

(a) neither Ultimate Parent nor any Subsidiary has
knowledge of any facts which would give rise to any claim, public or private,
of violation of Environmental Laws or damage to the environment emanating from,
occurring on or in any way related to real properties now or formerly owned,
leased or operated by any of them or to other assets or their use, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect;

(b) neither Ultimate Parent nor any of its Subsidiaries has
stored any Hazardous Materials on real properties now or formerly owned, leased
or operated by any of them and has not disposed of any Hazardous Materials in a
manner contrary to any Environmental Laws in each case in any manner that could
reasonably be expected to result in a Material Adverse Effect; and

(c) all buildings on all real properties now owned, leased
or operated by Ultimate Parent or any of its Subsidiaries are in compliance
with applicable Environmental Laws, except where failure to comply could not
reasonably be expected to result in a Material Adverse Effect.

6.19. RANK OF NOTES.

The Notes rank at least pari passu in right of payment with
all other senior unsecured Indebtedness of the Helen of Troy Entities.

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<PAGE> 29
6.20. EXISTING RESTRICTED INVESTMENTS.

SCHEDULE 6.20 sets forth all Restricted Investments of Ultimate Parent
or any other Subsidiary.

6.21. NO HOSTILE TENDER OFFER; USE OF PROCEEDS.

None of the proceeds of the sale of any Shelf Notes will be used to
finance a Hostile Tender Offer. None of the proceeds of the sale of any Notes
will be used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of purchasing or carrying any "margin stock" as defined
in Regulation G (12 CFR Part 207) of the Board of Governors of the Federal
Reserve System ("MARGIN STOCK") or for the purpose of maintaining, reducing or
retiring any Indebtedness which was originally incurred to purchase or carry
any stock that is then currently a margin stock or for any other purpose which
might constitute the purchase of such Notes a "purpose credit" within the
meaning of such Regulation G, unless the Company shall have delivered to the
Purchaser which is purchasing such Notes, on the Closing Day for such Notes, an
opinion of counsel satisfactory to such Purchaser stating that the purchase of
such Notes does not constitute a violation of such Regulation G. Neither the
Company nor any agent acting on its behalf has taken or will take any action
which might cause this Agreement or the Notes to violate Regulation G,
Regulation T or any other regulation of the Board of Governors of the Federal
Reserve System or to violate the Exchange Act, in each case as in effect now or
as the same may hereafter be in effect.

7. REPRESENTATIONS OF THE PURCHASER.

7.1. PURCHASE FOR INVESTMENT.

Purchaser represents that it is exchanging the Original Notes
for the Series 1996-A Notes or purchasing the Shelf Notes, as the case may be,
for its own account or for one or more separate accounts maintained by it or
for the account of one or more pension or trust funds and not with a view to
the distribution of such Series 1996-A Notes or such Shelf Notes, as the case
may be, provided that the disposition of its or their property shall at all
times be within its or their control. Purchaser understands that the Series
1996-A Notes and the Shelf Notes have not been registered under the Securities
Act and may be resold only if registered pursuant to the provisions of the
Securities Act or if an exemption from registration is available, except under
circumstances where neither such registration nor such an exemption is required
by law, and that the Company is not required to register such Series 1996-A
Notes or such Shelf Notes.

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<PAGE> 30
7.2. SOURCE OF FUNDS.

Purchaser represents that at least one of the following
statements is an accurate representation as to each source of funds (a
"SOURCE") to be used by it to pay the purchase price of the Shelf Notes to be
purchased by it hereunder:

(a) the Source constitutes such Purchaser's "insurance
company general account" (as such term is defined under Section V of the United
States Department of Labor's Prohibited Transaction Class Exemption ("PTCE")
95-60) and such Purchaser satisfies all of the applicable requirements for
relief under Sections I and IV of PTCE 95-60; or

(b) the Source is either (i) an insurance company pooled
separate account, within the meaning of PTCE 90-1 (issued January 29, 1990), or
(ii) a bank collective investment fund, within the meaning of the PTCE 91-38
(issued July 12, 1991) and, except as it has disclosed to the Helen of Troy
Entities in writing pursuant to this paragraph (b), no employee benefit plan or
group of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such pooled separate
account or collective investment fund; or

(c) the Source constitutes assets of an "INVESTMENT FUND"
(within the meaning of Part V of the QPAM Exemption) managed by a "QUALIFIED
PROFESSIONAL ASSET MANAGER" or "QPAM" (within the meaning of Part V of the QPAM
Exemption), no employee benefit plan's assets that are included in such
investment fund, when combined with the assets of all other employee benefit
plans established or maintained by the same employer or by an affiliate (within
the meaning of Section V(c)(1) of the QPAM Exemption) of such employer or by
the same employee organization and managed by such QPAM, exceed 20% of the
total client assets managed by such QPAM, the conditions of Part I(c) and (g)
of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "CONTROL" in Section V(e)
of the QPAM Exemption) owns a 5% or more interest in the Helen of Troy Entities
and (i) the identity of such QPAM and (ii) the names of all employee benefit
plans whose assets are included in such investment fund have been disclosed to
the Helen of Troy Entities in writing pursuant to this paragraph (c); or

(d) the Source is a governmental plan; or

(e) the Source is one or more employee benefit plans, or a
separate account or trust fund comprised of one or more employee benefit plans,
each of which has been identified to the Helen of Troy Entities in writing
pursuant to this paragraph (e); or

(f) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of ERISA.

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<PAGE> 31
As used in this SECTION 7.2, the terms "EMPLOYEE BENEFIT PLAN", "GOVERNMENTAL
PLAN", "PARTY IN INTEREST" and "SEPARATE ACCOUNT" shall have the respective
meanings assigned to such terms in section 3 of ERISA.

8. INFORMATION

8.1. FINANCIAL AND BUSINESS INFORMATION.

Ultimate Parent shall deliver, or shall cause to be delivered,
to each holder of Notes that is an Institutional Investor:

(a) Quarterly Statements -- within 45 days after the end of
each quarterly fiscal period in each fiscal year of Ultimate Parent (other than
the last quarterly fiscal period of each such fiscal year) duplicate copies of,

(i) a consolidated balance sheet of Ultimate
Parent and its Subsidiaries as at the end of such quarter, and

(ii) consolidated statements of income,
stockholders' equity, partners' capital and cash flows of
Ultimate Parent and its Subsidiaries, for such quarter and (in
the case of the second and third quarters) for the portion of
the fiscal year ending with such quarter,

setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable detail,
prepared in accordance with GAAP applicable to quarterly financial statements
generally, and certified by a Senior Financial Officer as fairly presenting, in
all material respects, the financial position of the companies being reported
on and their results of operations and cash flows, subject to changes resulting
from year-end adjustments, provided that delivery within the time period
specified above of copies of Ultimate Parent's Quarterly Report on Form 10-Q
prepared in compliance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the requirements
of this SECTION 8.1(A);

(b) Annual Statements -- within 90 days after the end of
each fiscal year of Ultimate Parent, duplicate copies of,

(i) a consolidated balance sheet of Ultimate
Parent and its Subsidiaries, as at the end of such year, and

(ii) consolidated statements of income,
stockholders' equity, partners' capital and cash flows of
Ultimate Parent and its Subsidiaries, for such year,

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<PAGE> 32
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied

(A) by an opinion thereon of independent
certified public accountants of recognized national standing
in the United States, which opinion shall state that such
financial statements present fairly, in all material respects,
the financial position of the companies being reported upon
and their results of operations and cash flows and have been
prepared in conformity with GAAP, and that the examination of
such accountants in connection with such financial statements
has been made in accordance with generally accepted auditing
standards, and that such audit provides a reasonable basis for
such opinion in the circumstances, and

(B) a certificate of such accountants stating
that they have reviewed this Agreement and stating further
whether, in making their audit, they have become aware of any
condition or event that then constitutes a Default or an Event
of Default, and, if they are aware that any such condition or
event then exists, specifying the nature and period of the
existence thereof (it being understood that such accountants
shall not be liable, directly or indirectly, for any failure
to obtain knowledge of any Default or Event of Default unless
such accountants should have obtained knowledge thereof in
making an audit in accordance with generally accepted auditing
standards or did not make such an audit),

provided that delivery within the time period specified above of Ultimate
Parent's Annual Report on Form 10-K for such fiscal year (together with
Ultimate Parent's annual report to shareholders, if any, prepared pursuant to
Rule 14a-3 under the Exchange Act) prepared in accordance with the requirements
therefor and filed with the Securities and Exchange Commission, together with
the accountant's certificate described in clause (B) above, shall be deemed to
satisfy the requirements of this SECTION 8.1(B);

(c) Consolidating Financial Statements -- within 45 days
after the end of each quarterly fiscal period in each fiscal year of Ultimate
Parent (other than the last quarterly fiscal period of each such fiscal year),
and within 90 days after the end of each fiscal year of Ultimate Parent,
duplicate copies of, either, as appropriate:

(i) a consolidating balance sheet of Ultimate
Parent and its Subsidiaries as of the end of each such
quarter, or

(ii) a consolidating balance sheet of Ultimate
Parent and its Subsidiaries as of the end of such year and a
consolidating statement of income of Ultimate Parent and its
Subsidiaries for such fiscal year, and

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<PAGE> 33
certified by a Senior Financial Officer as fairly presenting, in all material
respects, the financial position of the companies being reported on;

(d) SEC and Other Reports -- promptly upon their becoming
available, one copy of (i) each financial statement, report, notice or proxy
statement sent by Ultimate Parent or any Subsidiary to public securities
holders generally, and (ii) each regular or periodic report, each registration
statement (without exhibits except as expressly requested by such holder), and
each prospectus and all amendments thereto filed by Ultimate Parent or any
Subsidiary with the Securities and Exchange Commission and of all press
releases and other statements made available generally by Ultimate Parent or
any Subsidiary to the public concerning developments that are Material;

(e) Notice of Default or Event of Default -- promptly, and
in any event within five days after a Responsible Officer becoming aware of the
existence of any Default or Event of Default or that any Person has given any
notice or taken any action with respect to a claimed default hereunder or that
any Person has given any notice or taken any action with respect to a claimed
default of the type referred to in SECTION 12(F), a written notice specifying
the nature and period of existence thereof and what action Ultimate Parent or
any Subsidiary is taking or proposes to take with respect thereto;

(f) ERISA Matters -- promptly, and in any event within five
days after a Responsible Officer becoming aware of any of the following, a
written notice setting forth the nature thereof and the action, if any, that
the Company or an ERISA Affiliate proposes to take with respect thereto:

(i) with respect to any Plan, any reportable
event, as defined in section 4043(b) of ERISA and the
regulations thereunder, for which notice thereof has not been
waived pursuant to such regulations as in effect on the date
hereof; or

(ii) the taking by the PBGC of steps to institute,
or the threatening by the PBGC of the institution of,
proceedings under section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan,
or the receipt by the Company or any ERISA Affiliate of a
notice from a Multiemployer Plan that such action has been
taken by the PBGC with respect to such Multiemployer Plan; or

(iii) any event, transaction or condition that
could result in the incurrence of any liability by the Company
or any ERISA Affiliate pursuant to Title I or IV of ERISA or
the penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any
ERISA Affiliate pursuant to Title I or

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<PAGE> 34
IV of ERISA or such penalty or excise tax provisions, if such
liability or Lien, taken together with any other such
liabilities or Liens then existing, could reasonably be
expected to have a Material Adverse Effect;

(g) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice to Ultimate
Parent or any Subsidiary from any Federal or state or Bermuda or Barbados
Governmental Authority relating to any order, ruling, statute or other law or
regulation that could reasonably be expected to have a Material Adverse Effect;
and

(h) Requested Information -- with reasonable promptness,
such other data and information relating to the business, operations, affairs,
financial condition, assets or properties of Ultimate Parent or any of its
Subsidiaries or relating to the ability of the Company to perform its
obligations hereunder and under the Notes as from time to time may be
reasonably requested by any such holder of Notes.

8.2. OFFICER'S CERTIFICATE.

Each set of financial statements delivered to a holder of
Notes pursuant to SECTION 8.1(A) or 8.1(B) shall be accompanied by a
certificate of a Senior Financial Officer of Ultimate Parent, in each case
setting forth:

(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether Ultimate Parent
was in compliance with the requirements of SECTIONS 11.1, 11.2(E), 11.3 and
11.7 hereof during the quarterly or annual period covered by the statements
then being furnished (including with respect to each such Section, where
applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such Sections,
and the calculation of the amount, ratio or percentage then in existence); and

(b) Event of Default -- a statement that such officer or
accountant, as the case may be, has reviewed the relevant terms hereof and has
made, or caused to be made, under his or her supervision, a review of the
transactions and conditions of Ultimate Parent and its Subsidiaries from the
beginning of the quarterly or annual period covered by the statements then
being furnished to the date of the certificate and that such review shall not
have disclosed the existence during such period of any condition or event that
constitutes a Default or an Event of Default or, if any such condition or event
existed or exists (including, without limitation, any such event or condition
resulting from the failure of Ultimate Parent or any Subsidiary to comply with
any Environmental Law), specifying the nature and period of existence thereof
and what action Ultimate Parent or any Subsidiary shall have taken or proposes
to take with respect thereto.

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8.3. INSPECTION.

Ultimate Parent, General Partner and the Company will permit
the representatives of each holder of Notes that is an Institutional Investor:

(a) No Default -- if no Default or Event of Default then
exists, at the expense of such holder and upon reasonable prior notice to
Ultimate Parent, General Partner or the Company, as the case may be, to visit
the principal executive office of Ultimate Parent, General Partner, or the
Company to discuss the affairs, finances and accounts of Ultimate Parent,
General Partner or the Company and their respective Subsidiaries with Ultimate
Parent's, General Partner's or the Company's officers, and (with the consent of
Ultimate Parent, General Partner or the Company, respectively, which consent
will not be unreasonably withheld) its independent public accountants, and
(with the consent of Ultimate Parent, which consent will not be unreasonably
withheld) to visit the other offices and properties of Ultimate Parent, General
Partner, the Company and each other Subsidiary, all at such reasonable times
and as often as may be reasonably requested in writing; and

(b) Default -- if a Default or Event of Default then
exists, at the expense of Ultimate Parent, General Partner and the Company to
visit and inspect any of the offices or properties of Ultimate Parent, General
Partner, the Company or any Subsidiary, to examine all their respective books
of account, records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants (and by this
provision Ultimate Parent, General Partner and the Company authorize said
accountants to discuss the affairs, finances and accounts of Ultimate Parent
and its Subsidiaries), all at such times and as often as may be requested.

9. PREPAYMENTS AND PURCHASES OF THE NOTES.

9.1. REQUIRED PREPAYMENTS OF SERIES 1996-A NOTES.

On January 5, 2005 and on each January 5 thereafter to and
including January 5, 2007 the Company will prepay $10,000,000 principal amount
(or such lesser principal amount as shall then be outstanding) of the Series
1996-A Notes at par and without payment of the Make-Whole Amount or any
premium, provided that upon any partial prepayment of the Series 1996-A Notes
pursuant to SECTION 9.3, 9.4 or 9.7 or purchase of any of the Series 1996-A
Notes pursuant to SECTION 9.6 the principal amount of each required prepayment
of the Series 1996-A Notes becoming due under this SECTION 9.1 on and after the
date of such prepayment or purchase shall be reduced in the same proportion as
the aggregate unpaid principal amount of the Series 1996-A Notes is reduced as
a result of such prepayment or purchase.

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9.2. REQUIRED PREPAYMENTS OF SHELF NOTES.

The Shelf Notes of each Series shall be subject to required
prepayments, if any, set forth in the Shelf Notes of such Series, provided
that upon any partial prepayment of the Shelf Notes of such Series pursuant to
SECTION 9.3, 9.4 or 9.7 or purchase of any of the Shelf Notes of such Series
pursuant to SECTION 9.6 the principal amount of each required prepayment of the
Shelf Notes of such Series becoming due pursuant to the terms of such Shelf
Notes on and after the date of such prepayment or purchase shall be reduced in
the same proportion as the aggregate unpaid principal amount of the Shelf Notes
of such Series is reduced as a result of such prepayment or purchase.

9.3. OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT.

The Company may, at its option, upon notice as provided below,
prepay at any time six months after the date of issue all, or from time to time
any part of, any Series of Notes, in an amount not less than $1,000,000 (and in
multiples of $100,000) in the case of a partial prepayment, at 100% of the
principal amount so prepaid, plus the Make- Whole Amount determined for the
prepayment date with respect to such principal amount. The Company will give
each holder of such Series of Notes written notice of each optional prepayment
under this SECTION 9.3 not less than 10 Business Days prior to the date fixed
for such prepayment. Each such notice shall specify such date, the aggregate
principal amount of such Series of Notes to be prepaid on such date, each Note
of such Series held by such holder, and the principal amount of each Note of
such Series held by such holder to be prepaid (determined in accordance with
SECTION 9.5). Such notice shall state that prepayment is being made pursuant
to this SECTION 9.3. The Company shall, on or before the day on which it gives
written notice of any prepayment pursuant to this SECTION 9.3, give telephonic
notice of the principal amount of the Notes of such Series to be prepaid and
the prepayment date to each holder that is an Institutional Investor which
shall have designated a recipient for such notices in SCHEDULE A or by notice
in writing to the Company.

9.4. OFFER TO PREPAY, WITH MAKE-WHOLE AMOUNT, FROM ASSET SALE PROCEEDS.

The Company will, under the circumstances contemplated by
SECTION 11.3(B) and upon notice as provided below, offer to prepay such
principal amount of the Notes as required by such Section (the "NOTEHOLDERS'
SHARE"), at 100% of the principal amount so prepaid, plus the Make-Whole Amount
determined for the prepayment date with respect to such principal amount. Any
such offer shall provide each holder with sufficient information to enable it
to make an informed decision with respect to such offer, and shall remain open
for 15 Business Days. Each such offer shall specify the date fixed for
prepayment, the aggregate principal amount of the Notes to be prepaid on such
date, each Note held by such holder, and the principal amount of each Note held
by such holder to be prepaid (determined in accordance with SECTION 11.3).
Such notice shall state that prepayment is being made pursuant to this SECTION
9.4. The Company shall, on or before the day on which it gives written notice
of any prepayment pursuant to this SECTION 9.4, give

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telephonic notice of the principal amount of the Notes to be prepaid and the
prepayment date to each holder that is an Institutional Investor which shall
have designated a recipient for such notices in SCHEDULE A or by notice in
writing to the Company. If the holders of more than 25% of the principal
amount of the Notes then outstanding accept such offer (which acceptance shall
be irrevocable), the Company shall promptly notify the remaining holders of
such fact and the expiration date for the acceptance by holders of Notes of
such offer shall be extended by the number of days necessary to give each such
remaining holder at least 5 Business Days from its receipt of such notice to
accept such offer (which acceptance shall be irrevocable). On the date fixed
for such prepayment, the Company shall prepay the principal amount of Notes,
the holders of which have accepted the Company's offer of prepayment, equal to
the lesser of (x) the aggregate outstanding principal amount of such Notes or
(y) the Noteholders' Share.

9.5. ALLOCATION OF PARTIAL PREPAYMENTS.

In the case of each partial prepayment of the Series 1996-A
Notes and the Shelf Notes pursuant to SECTION 9.1 and 9.2, respectively, the
principal amount of the Series 1996-A Notes or the Shelf Notes, as the case may
be, to be prepaid shall be allocated among all of such Notes at the time
outstanding in proportion, as nearly as practicable, to the respective unpaid
principal amounts thereof not theretofore called for prepayments. In the case
of each partial prepayment of a Series of Notes pursuant to SECTION 9.3, the
principal amount of such Notes to be prepaid shall be allocated among all of
the Notes of such Series at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof not theretofore
called for prepayment. In the case of each prepayment or purchase of Notes
pursuant to SECTION 9.4, 9.6 or 9.7, the principal amount of the Notes to be
prepaid or purchased shall be allocated among all of the Notes to be subject to
such prepayment or purchase in proportion, as nearly as practicable, to the
respective unpaid principal amounts thereof not theretofore called for
prepayment.

9.6. CONDITIONAL RIGHT TO PUT UPON CHANGE OF CONTROL.

(a) GRANTING OF CONDITIONAL PUT. The Company hereby gives
and grants to the holder of each Note the option, right and privilege (such
option, right and privilege herein collectively referred to as "RIGHT TO PUT")
to require the Company, upon or after the occurrence of a Change of Control, to
purchase from such holder on the terms and conditions hereinafter set forth,
and the Company agrees so to purchase from such holder, for an amount equal to
the Agreed Put Consideration, all, but not less than all, Notes held by such
holder.

(b) EXERCISE OF CONDITIONAL PUT. Within 10 Business Days
after any Responsible Officer of the Company or General Partner has knowledge
of the occurrence of a Change of Control, the Company shall, or General Partner
shall cause the Company to, give the holder of each Note written notice thereof
describing such Change of Control, and the facts and circumstances surrounding
the occurrence thereof, in reasonable detail. At any time prior to 30

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Business Days after the holder of any Note shall receive such notice, such
holder may exercise its Right to Put by delivering to the Company and to each
other holder of a Note, at the respective addresses provided by the Company
pursuant to SECTION 20 (if so provided), and to Purchaser, at its address
specified in SCHEDULE A attached hereto, a notice of sale substantially in the
form of EXHIBIT 9.6 attached hereto (a "NOTICE OF SALE"); provided, that after
the first such Notice of Sale is given as to a particular Change of Control,
the holder of each other Note shall have until the later of (a) the expiration
of such 30-Business Day period or (b) 10 Business Days after its receipt of the
first such Notice of Sale to exercise its Right to Put in the manner specified
above; and provided, further, that if the Company receives one or more Notices
of Sale from the Required Holders(s), the Company shall give the holder of each
Note prompt written notice (a "CHANGE OF CONTROL PURCHASE NOTICE") thereof,
whereupon the holder of each Note shall have until the later of (x) the
expiration of such 30-Business Day period or (y) 10 Business Days after its
receipt of the Change of Control Purchase Notice to exercise its Right to Put
by delivering to the Company a Notice of Sale. If, but only if, the Required
Holders(s) shall deliver a Notice or Notices of Sale pursuant to any provision
of the preceding sentence, the Company shall purchase the Notes then held by
each holder that has given a Notice of Sale on the date specified in the Change
of Control Purchase Notice (which shall be not less than 30 days nor more than
45 days after the Change of Control Purchase Notice), and such holder shall
sell such Notes to the Company, without recourse, representation, or warranty
(other than as to such holder's full right, title and interest to such Notes
free of any adverse claim thereto), at a price, payable in immediately
available funds by wire transfer to the account specified pursuant to SECTION
16 or to such other account as may be specified in such notice, equal to the
Agreed Put Consideration. The holder of each Note shall have the rights
specified in this SECTION 9.6 with respect to each Change of Control that shall
occur, regardless of any act or omission to act with respect to any previous
Change of Control.

9.7. OPTION TO PREPAY DUE TO TAX PAYMENTS.

In the event that the Company is required to make additional
payments with respect to any Note pursuant to SECTION 10.6 due to Taxes imposed
by the United States or any political subdivision thereof, or Bermuda or any
political subdivision thereof, or Barbados or any political subdivision
thereof, the Company may prepay such Note in full by paying the holder thereof
an amount equal to the sum of (i) the outstanding principal amount of such Note
on the date of such prepayment, plus (ii) all accrued and unpaid interest to
such date with respect to such Note, plus (iii) the Make-Whole Amount as of
such date with respect to such Note. The Company will give each holder of the
Notes written notice of each optional prepayment under this SECTION 9.7 not
less than 30 days and not more than 60 days prior to the date fixed for such
prepayment. Each such notice shall specify such date, the aggregate principal
amount of the Notes to be prepaid on such date, each Note held by such holder,
and the principal amount of each Note held by such holder to be prepaid
(determined in accordance with SECTION 9.5). Such notice shall state that
prepayment is being made pursuant to this SECTION 9.7. The Company shall, on
or before the day on which it gives written notice of any prepayment pursuant
to this SECTION 9.7, give telephonic notice of the principal amount of the
Notes to be prepaid and the prepayment date to each holder

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that is an Institutional Investor which shall have designated a recipient for
such notices in SCHEDULE A or by notice in writing to the Company.

9.8. MATURITY; SURRENDER, ETC.

In the case of each prepayment of Notes pursuant to this
SECTION 9, the principal amount of each Note to be prepaid shall mature and
become due and payable on the date fixed for such prepayment, together with
interest on such principal amount accrued to such date and the applicable
Make-Whole Amount, if any. From and after such date, unless the Company or any
Guarantor shall fail to pay such principal amount when so due and payable,
together with the interest and Make-Whole Amount, if any, as aforesaid,
interest on such principal amount shall cease to accrue. Any Note paid or
prepaid in full shall be surrendered to the Company and canceled and shall not
be reissued, and no Note shall be issued in lieu of any prepaid principal
amount of any Note.

9.9. PURCHASE OF NOTES.

Neither the Company nor any Guarantor will or will permit any
of its Affiliates to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except upon the payment or prepayment
or purchase of the Notes in accordance with the terms of this Agreement and the
Notes. The Company will promptly cancel all Notes acquired by it or any of its
Affiliates pursuant to any payment, prepayment or purchase of Notes pursuant to
any provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.

9.10. MAKE-WHOLE AMOUNT.

The term "MAKE-WHOLE AMOUNT" means, with respect to any Note,
an amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, provided that the Make-Whole Amount may in no
event be less than zero. For the purposes of determining the Make-Whole
Amount, the following terms have the following meanings:

"CALLED PRINCIPAL" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to SECTION 9.3,
9.4 or 9.7 or is to be purchased pursuant to SECTION 9.6 or has
become or is declared to be immediately due and payable pursuant to
SECTION 13.1, as the context requires.

"DESIGNATED SPREAD" means (i) in the case of a Note that is to
be purchased pursuant to SECTION 9.6 or prepaid pursuant to SECTION
9.7, 1.05% per annum, and (ii) in all other cases, zero.

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"DISCOUNTED VALUE" means, with respect to the Called Principal
of any Note, the amount obtained by discounting all Remaining
Scheduled Payments with respect to such Called Principal from their
respective scheduled due dates to the Settlement Date with respect to
such Called Principal, in accordance with accepted financial practice
and at a discount factor (applied on the same periodic basis as that
on which interest on the Notes is payable) equal to the Reinvestment
Yield.

"REINVESTMENT YIELD" means, with respect to the Called
Principal of any Note, the Designated Spread plus the yield to
maturity implied by (i) the yields reported, as of 10:00 A.M. (New
York City time) on the second Business Day preceding the Settlement
Date with respect to such Called Principal, on the display designated
as "PAGE 678" on the Telerate Access Service (or such other display as
may replace Page 678 on Telerate Access Service) for actively traded
U.S. Treasury securities having a maturity equal to the Remaining
Average Life of such Called Principal as of such Settlement Date, or
(ii) if such yields are not reported as of such time or the yields
reported as of such time are not ascertainable, the Treasury Constant
Maturity Series Yields reported, for the latest day for which such
yields have been so reported as of the second Business Day preceding
the Settlement Date with respect to such Called Principal, in Federal
Reserve Statistical Release H.15 (519) (or any comparable successor
publication) for actively traded U.S. Treasury securities having a
constant maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date. Such implied yield will be
determined, (a) if necessary, by (1) converting U.S. Treasury bill
quotations to bond-equivalent yields in accordance with accepted
financial practice and (2) interpolating linearly between (x) the
actively traded U.S. Treasury security with the duration closest to
and greater than the Remaining Average Life and (y) the actively
traded U.S. Treasury security with the duration closest to and less
than the Remaining Average Life and, (b) if interest on such Notes is
paid quarterly, by converting all such implied yields to a quarterly
basis in accordance with accepted financial practice.

"REMAINING AVERAGE LIFE" means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (i) such Called Principal into (ii) the sum
of the products obtained by multiplying (a) the principal component of
each Remaining Scheduled Payment with respect to such Called Principal
by (b) the number of years (calculated to the nearest one-twelfth
year) that will elapse between the Settlement Date with respect to
such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.

"REMAINING SCHEDULED PAYMENTS" means, with respect to the
Called Principal of any Note, all payments of such Called Principal
and interest thereon that would be due after the Settlement Date with
respect to such Called Principal if no payment of such Called
Principal were made prior to its scheduled due date, provided that if
such Settlement Date is not a date on which interest payments are due
to be made under the

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terms of the Notes, then the amount of the next succeeding scheduled
interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date
pursuant to SECTION 9.3, 9.4, 9.6, 9.7 or 13.1.

"SETTLEMENT DATE" means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid
pursuant to SECTION 9.3, 9.4 or SECTION 9.7 or is to be purchased
pursuant to SECTION 9.6, or has become or is declared to be
immediately due and payable pursuant to SECTION 13.1, as the context
requires.

10. AFFIRMATIVE COVENANTS.

During the Issuance Period and so long thereafter as any Note
is outstanding and unpaid, the Helen of Troy Entities jointly and severally
covenant as follows:

10.1. COMPLIANCE WITH LAW.

Each of the Helen of Troy Entities will and will cause each of
its Subsidiaries to comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation,
Environmental Laws and ERISA, and will obtain and maintain in effect all
licenses, certificates, permits, franchises and other governmental
authorizations necessary to the ownership of their respective properties or to
the conduct of their respective businesses, in each case to the extent
necessary to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain in effect
such licenses, certificates, permits, franchises and other governmental
authorizations could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

10.2. INSURANCE.

Each of the Helen of Troy Entities will and will cause each of
its Subsidiaries to maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.

10.3. MAINTENANCE OF PROPERTIES.

Each of the Helen of Troy Entities will and will cause each of
its Subsidiaries to maintain and keep, or cause to be maintained and kept,
their respective properties in good repair, working order and condition (other
than ordinary wear and tear), so that the business carried on in connection
therewith may be properly conducted at all times, provided that this SECTION
10.3 shall not prevent Ultimate Parent, the Company or any other Subsidiary
from discontinuing the

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operation and the maintenance of any of its properties if such discontinuance
is desirable in the conduct of its business and the Company (based upon the
good faith judgment of General Partner) or Ultimate Parent has concluded that
such discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

10.4. PAYMENT OF TAXES AND CLAIMS.

Each of the Helen of Troy Entities will and will cause each of
its Subsidiaries to file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or franchises, to
the extent such taxes and assessments have become due and payable and before
they have become delinquent and all claims for which sums have become due and
payable that have or might become a Lien on properties or assets of Ultimate
Parent, the Company or any other Subsidiary, provided that neither Ultimate
Parent, the Company nor any other Subsidiary need pay any such tax or
assessment or claims if (i) the amount, applicability or validity thereof is
contested by Ultimate Parent, the Company or such other Subsidiary on a timely
basis in good faith and in appropriate proceedings, and Ultimate Parent, the
Company or such other Subsidiary has established adequate reserves therefor in
accordance with GAAP on the books of Ultimate Parent, the Company or such other
Subsidiary or (ii) the nonpayment of all such taxes and assessments in the
aggregate could not reasonably be expected to have a Material Adverse Effect.

10.5. CORPORATE EXISTENCE, LICENSES AND PERMITS, ETC.

Each of the Helen of Troy Entities will at all times preserve
and keep in full force and effect its corporate or partnership existence.
Subject to SECTIONS 11.3 and 11.6, each of the Helen of Troy Entities will at
all times preserve and keep in full force and effect the corporate or
partnership existence of each of its Subsidiaries (unless merged into Ultimate
Parent or a Subsidiary) and all rights and franchises of the Helen of Troy
Entities and their respective Subsidiaries unless, in the good faith judgment
of Ultimate Parent or the Company (based upon the good faith judgment of
General Partner), as applicable, the termination of or failure to preserve and
keep in full force and effect such corporate or partnership existence, right or
franchise could not, individually or in the aggregate, have a Material Adverse
Effect. Each of the Helen of Troy Entities will preserve and keep in force and
effect, and will cause each of its Subsidiaries to preserve and keep in force
and effect, all licenses and permits necessary to the conduct of its and their
respective businesses, except where in the good faith judgment of Ultimate
Parent or the Company (based upon the good faith judgment of General Partner),
as applicable, the failure to preserve or keep such licenses and permits in
force and effect could not individually or in the aggregate have a Material
Adverse Effect.

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10.6. TAXES.

(a) Any and all payments required to be made hereunder or
under the Notes by the Company or any Guarantor shall be made in lawful
currency of the United States, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding taxes imposed
on, or measured by reference to, the net income of, and franchise taxes imposed
on, the holder of any Note by any of (i) the United States or any political
subdivision thereof, (ii) the state jurisdiction under the laws of which such
holder is organized or in which it is otherwise doing business or (iii) any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "TAXES"). If the Company or any Guarantor shall be required by law to
deduct any Taxes from or in respect of any sum required to be paid hereunder or
under the Notes to or for the benefit of the holder of any Note, (A) such sum
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums required to be
paid under this SECTION 10.6) the amount received by such holder shall be equal
to the sum which would have been so received had no such deductions been made,
(B) the Company or such Guarantor shall make such deductions and (C) the
Company or such Guarantor shall pay the full amount of such deductions to the
relevant taxation authority or other authority in accordance with applicable
law.

(b) In addition, the Company and the Guarantors, as
appropriate, agree to pay, subject to the Company's and any Guarantor's rights
under SECTION 10.6(D) not to pay pending resolution of a contest, any Taxes
which arise from any payment made hereunder or under any Note or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any Note (including, without limitation, any Taxes imposed on
amounts payable under this SECTION 10.6).

(c) Each of the Company and the Guarantors will indemnify
each holder of a Note for the full amount of Taxes (including, without
limitation, any Taxes imposed by any jurisdiction on amounts payable under this
SECTION 10.6) paid by such holder and any liability (including penalties,
interest and expenses) arising therefrom or required to be paid with respect
thereto. The holder of any Note agrees to notify the Company or Ultimate
Parent promptly of any payment of Taxes made by such holder and, if
practicable, any request, demand or notice received in respect thereof prior to
such payment. Each holder of a Note shall be entitled to payment of this
indemnification within 30 days from the date such holder makes written demand
therefor to the Company or any Guarantor. A certificate as to the amount of
such indemnification submitted to the Company or any Guarantor by such holder,
setting forth the calculation thereof, shall (absent manifest error) be
conclusive and binding for all purposes.

(d) In the event the Company or any Guarantor desires to
contest its liability for payment of any Taxes which it otherwise would be
required to pay pursuant to SECTIONS 10.6(A) or 10.6(B), the Company or such
Guarantor, as appropriate, may elect not to make such payment,

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provided that (i) such nonpayment is lawful and the Company or such Guarantor,
as appropriate, has a reasonable basis, as set forth in an Officer's
Certificate delivered to the holder of the relevant Note, for such nonpayment,
(ii) the Company or such Guarantor, as appropriate, promptly commences and
continues to pursue diligently a contest of such liability, (iii) the Company
or such Guarantor, as appropriate, keeps the holder of the relevant Note fully
informed about the progress of such contest, (iv) such nonpayment does not
result in any danger of sale, forfeiture or loss of, or the creation of any
Lien on, any asset of either the Company, Ultimate Parent or any Subsidiary
thereof and (v) such nonpayment does not continue past the earliest date on
which such Taxes are determined by a court or administrative body of competent
jurisdiction to be due and payable by the Company or such Guarantor and such
determination is not stayed pending appeal.

(e) Within 30 days after the date of any payment of Taxes,
the Company or Guarantor (as the case may be) will furnish to the applicable
holder or holders of Notes the original or a certified copy of a receipt
evidencing payment thereof.

10.7. COVENANT TO SECURE NOTES EQUALLY.

Each Helen of Troy Entity will, if it or any Subsidiary shall
create or assume any Lien upon any of its property or assets, whether now owned
or hereafter acquired, other than Liens permitted by the provisions of SECTION
11.2 (unless prior written consent to the creation or assumption thereof shall
have been obtained pursuant to SECTION 19), make or cause to be made effective
provision whereby the Notes will be secured by such Lien equally and ratably
with any and all other Indebtedness thereby secured pursuant to such agreements
and instruments as shall be approved by the Required Holders, and the Helen of
Troy Entities will cause to be delivered to each holder of a Note an opinion of
independent counsel to the effect that such agreements and instruments are
enforceable in accordance with their terms, and in any such case the Notes
shall have the benefit, to the full extent that, and with such priority as, the
holders of Notes may be entitled under applicable law, of an equitable Lien on
such property or assets securing the Notes.

11. NEGATIVE COVENANTS.

During the Issuance Period and so long thereafter as any Note
is outstanding and unpaid, the Helen of Troy Entities jointly and severally
covenant as follows:

11.1. FINANCIAL COVENANTS, INDEBTEDNESS.

(a) CONSOLIDATED NET WORTH. Ultimate Parent will not
permit Consolidated Net Worth (i) at any time during the period commencing on
January 5, 1996 and ended on May 31, 1996 to be less than $65,000,000, (ii) at
any time during the fiscal quarter of Ultimate Parent ended on August 31, 1996
to be less than $65,000,000 PLUS the greater of zero or 40% of Consolidated Net
Earnings for the fiscal quarter of Ultimate Parent ended on May 31, 1996, or
(iii) at any time during any fiscal quarter of Ultimate Parent thereafter to be
less than the minimum

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Consolidated Net Worth required by this SECTION 11.1(A) during the immediately
preceding fiscal quarter of Ultimate Parent PLUS the greater of zero or 40% of
Consolidated Net Earnings for the immediately preceding fiscal quarter of
Ultimate Parent.

(b) CONSOLIDATED INDEBTEDNESS.

(i) MAINTENANCE. Ultimate Parent will not permit
Consolidated Indebtedness to exceed 55% of Consolidated Total
Capitalization at any time.

(ii) INCURRENCE. Ultimate Parent will not, and
will not permit any Subsidiary to, directly or indirectly,
create, incur, assume, guarantee, or otherwise become directly
or indirectly liable with respect to, any Indebtedness, unless
on the date Ultimate Parent or such Subsidiary becomes liable
with respect to any such Indebtedness and immediately after
giving effect thereto and the concurrent retirement of any
other Indebtedness:

(A) no Default or Event of Default exists, and

(B) (1) except in the case of the incurrence of
Permitted Credit Facility Indebtedness, Consolidated
Indebtedness does not exceed 400% of EBITDA for the period of
four consecutive fiscal quarters of Ultimate Parent mostly
recently ended, or (2) in the case of the incurrence of
Permitted Credit Facility Indebtedness, Consolidated
Indebtedness minus Permitted Credit Facility Indebtedness does
not exceed 400% of EBITDA for the period of four consecutive
fiscal quarters of Ultimate Parent most recently ended.

For the purposes of this SECTION 11.1(B)(II), any Person becoming a Subsidiary
after the date hereof shall be deemed, at the time it becomes a Subsidiary, to
have incurred all of its then outstanding Indebtedness, and any Person
extending, renewing or refunding any Indebtedness shall be deemed to have
incurred such Indebtedness at the time of such extension, renewal or refunding,
and in the event that the Company acquires any Subsidiary or assets, EBITDA for
the period preceding the date of such acquisition included within the four
consecutive fiscal quarters of Ultimate Parent shall be adjusted, as agreed by
the Helen of Troy Entities and the Required Holders, in order to make a
reasonable, pro forma adjustment to EBITDA as a result of such acquisition.

(c) SECURED WORKING CAPITAL FACILITIES. Notwithstanding
anything contained in SECTION 11.2 to the contrary, neither Ultimate Parent nor
any other Helen of Troy Entity will or will permit its Subsidiaries to enter
into any agreement with any Person establishing any credit facility, secured by
a Lien on assets of Ultimate Parent, the Company or any other Subsidiary, for
the purpose of providing Ultimate Parent, the Company or any other Subsidiary
with a source of working capital.

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(d) SUBSIDIARY INDEBTEDNESS. No Helen of Troy Entity
will permit the sum, without duplication, of (x) subject to the second
paragraph of this SECTION 11.1(D), all Consolidated Indebtedness of Ultimate
Parent's Subsidiaries other than the Company, plus (y) all Consolidated
Indebtedness secured by Liens permitted by SECTION 11.2(E) to exceed at any
time 30% of Consolidated Net Worth.

Notwithstanding anything in this Agreement to the contrary,
the term Consolidated Indebtedness as used in clause (x) of this SECTION
11.1(D) shall not include Indebtedness of HOT-Barbados.

11.2. LIENS.

No Helen of Troy Entity will or will permit any of its
Subsidiaries to create, assume or suffer to exist any lien upon or with respect
to any of its properties, whether now owned or hereafter acquired, or any
income or profits therefrom (whether or not provision is made for the equal and
ratable securing of the Notes in accordance with the provisions of SECTION
10.7), except:

(a) Liens of or resulting from any judgment or award, the
time for the appeal or petition for rehearing of which shall not have expired,
or in respect of which Ultimate Parent, the Company or another Subsidiary shall
at any time in good faith be prosecuting an appeal or a proceeding for a review
shall have been secured and with respect to which Ultimate Parent, the Company
or the other Subsidiary, as the case may be, has established adequate reserves
in accordance with GAAP;

(b) Liens incidental to the conduct of business or the
ownership of properties of Ultimate Parent, the Company and its other
Subsidiaries (including Liens in connection with worker's compensation,
unemployment insurance and other like laws, warehousemen's and attorney's liens
and statutory landlord's liens), provided that such Liens do not materially
impair the use or the value of such property in the operation of the business
of the Company or Ultimate Parent, or of Ultimate Parent and its Subsidiaries
taken as a whole, and Liens to secure the performance of bids, tenders or trade
contracts, or to secure statutory obligations, property taxes and assessments
or governmental charges, surety or appeal bonds or other Liens of like general
nature incurred in the ordinary course of business and not in connection with
the borrowing of money; provided in each case, that the obligation secured is
not overdue or, if overdue, is being contested in good faith by appropriate
actions or proceedings and that Ultimate Parent, the Company or the other
Subsidiary, as the case may be, has established adequate reserves in accordance
with GAAP;

(c) Liens securing Indebtedness of a Subsidiary other than
the Company to Ultimate Parent or to a Wholly-Owned Subsidiary;

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(d) Liens existing as of the Initial Date of Closing and
set forth on SCHEDULE 6.15, or the extension, renewal or replacement of any of
such Liens in respect of the same property theretofore subject thereto
(provided that the principal amount of the Indebtedness secured thereby shall
not have increased); and

(e) Liens, other than those described in the foregoing
clauses (a) - (e), securing Indebtedness, provided that the sum, without
duplication, of (x) all Consolidated Indebtedness secured by such additional
Liens plus (y) all Consolidated Indebtedness described in clause (x) of
SECTION 11.1(D) does not exceed at any time 30% of Consolidated Net Worth.

11.3. DISPOSITION OF PROCEEDS OF ASSET SALES.

(a) No Helen of Troy Entity will or will permit any of its
Subsidiaries to make any Asset Sale at any time if, after giving effect
thereto, the Net Cash Proceeds received by Ultimate Parent and its Subsidiaries
from all Asset Sales since November 30, 1995 would exceed 25% of Consolidated
Total Assets as at the end of the most recent fiscal quarter (the "TRIGGER
AMOUNT"); provided, that there shall be excluded from the Trigger Amount for
purposes of this SECTION 11.3(A) each Asset Sale, the subject of which is not
accounts receivable, and with respect to which either (i) Ultimate Parent, the
Company or such other Subsidiary, as the case may be, applies or, pursuant to a
legally binding agreement, commits to apply the Net Cash Proceeds within 365
days after such Asset Sale to an investment in properties, of comparable worth
and purpose in the business of Ultimate Parent, the Company or such other
Subsidiary, as the case may be, that replace the properties that were the
subject of such Asset Sale ("REPLACEMENT ASSETS"), so long as Ultimate Parent
or the Company has notified the holders of Notes in writing within 300 days
after such Asset Sale that it has determined to apply the Net Cash Proceeds
from such Asset Sale to an investment in Replacement Assets, and provided that,
in the case of a commitment to apply such Net Cash Proceeds to an investment in
Replacement Assets, the Net Cash Proceeds are in fact so applied within 545
days after such Asset Sale, or (ii) the Company offers to use the Net Cash
Proceeds therefrom to make prepayments in respect of the Notes and Pari Passu
Indebtedness, and all of such Net Cash Proceeds are so used, as provided below
(any Net Cash Proceeds described in this clause (ii) being referred to as
"EXCESS PROCEEDS").

(b) The Company, pursuant to SECTION 9.4 and not later than
the end of the 365-day period described in SECTION 11.3(A), shall use all
Excess Proceeds to make the prepayment in respect of those Notes as to which
the holders have accepted the Company's offer of prepayment under SECTION 9.4
and, on a pro rata basis (according to the respective principal amounts of all
Notes and all Pari Passu Indebtedness then outstanding) with such Notes, all
then outstanding Pari Passu Indebtedness as to which the holder thereof also
requires a prepayment of principal, in an aggregate principal amount of such
Notes and any then outstanding Pari Passu Indebtedness, rounded to the nearest
multiple of $1,000 nearest to the aggregate amount of such Excess Proceeds.

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(c) No Helen of Troy Entity will permit any of its
Subsidiaries to enter into or suffer to exist any agreement that would place
any restriction of any kind (other than pursuant to law or regulation) on the
ability of the Company or any Guarantor to make the mandatory prepayments in
respect of the Notes required by SECTION 11.3(B).

11.4. CHANGE OF BUSINESS.

No Helen of Troy Entity will change or will permit any of its
Subsidiaries to change in any Material respect the nature of its business or
operations from that conducted by Ultimate Parent, the Company and the other
Subsidiaries on the date hereof.

11.5. TRANSACTIONS WITH AFFILIATES.

No Helen of Troy Entity will or will permit any of its
Subsidiaries to enter into directly or indirectly any transaction or Material
group of related transactions (including without limitation the purchase,
lease, sale or exchange of properties of any kind or the rendering of any
service) with any Affiliate (other than Ultimate Parent, the Company or another
Subsidiary), except in the ordinary course and pursuant to the reasonable
requirements of Ultimate Parent's, the Company's or such Subsidiary's business
and upon fair and reasonable terms no less favorable to Ultimate Parent, the
Company or such Subsidiary than would be obtainable in a comparable
arm's-length transaction with a Person not an Affiliate.

11.6. MERGER, CONSOLIDATION, ETC.

Each Helen of Troy Entity will not and will not permit any
Subsidiary to consolidate with or merge with any other Person (other than (i)
in the case of Ultimate Parent, one or more Subsidiaries other than the
Company, provided that Ultimate Parent shall be the surviving corporation,
(ii) in the case of the Company, one or more Subsidiaries, provided that the
Company shall be the survivor or successor, (iii) in the case of any other
Helen of Troy Entity, one or more Subsidiaries, provided that such Helen of
Troy Entity shall be surviving corporation, except in the case of a merger with
the Company, in which case the Company shall be the survivor or successor, and
(iv) in the case of any other Subsidiary, one or more other Subsidiaries or
Ultimate Parent) or convey, transfer or lease substantially all of its assets
in a single transaction or series of transactions to any Person unless:

(a) in the case of a merger or consolidation involving any
Helen of Troy Entity, the successor formed by such consolidation or the
survivor of such merger shall be a solvent corporation or limited partnership
organized and existing under the laws of the United States or any State thereof
(including the District of Columbia) or, in the case of a merger involving
Ultimate Parent, Bermuda or the United States or any State thereof (including
the District of Columbia), or, in the case of a merger involving HOT-Barbados,
Barbados or the United States or any State thereof (including the District of
Columbia), and, if such successor or survivor is not

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such corporation or limited partnership, (i) such corporation or limited
partnership shall have executed and delivered to each holder of any Notes (x)
in the case of a merger or consolidation involving the Company, its assumption
of the due and punctual performance and observance of each covenant and
condition of this Agreement and the Notes, (y) in the case of a merger or
consolidation involving any other Helen of Troy Entity, its assumption of such
Helen of Troy Entity's liability under the guaranty set forth in SECTION 14 and
the due and punctual performance and observance of each covenant of such Helen
of Troy Entity in this Agreement, and (ii) shall have caused to be delivered to
each holder of any Notes an opinion of nationally recognized independent
counsel, or other independent counsel reasonably satisfactory to the Required
Holders, to the effect that all agreements or instruments effecting such
assumption are enforceable in accordance with their terms and comply with the
terms hereof, provided, however, that nothing in this SECTION 11.6(A) shall be
construed to permit a merger of the Company with any other Helen of Troy Entity
pursuant to which such other Helen of Troy Entity is the surviving corporation;

(b) in the case of a merger or consolidation involving a
Helen of Troy Entity other than Ultimate Parent, (i) SECTION 11.3 shall not
have been violated thereby, and (ii) the successor formed by such consolidation
or the survivor of such merger shall not own any Capital Stock or Indebtedness
of the Company or any other Subsidiary, or any Indebtedness of the Guarantors;
and

(c) in any case, immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing.

No conveyance, transfer or lease of substantially all of the assets of Helen of
Troy Entity or any Subsidiary shall have the effect of releasing the Company or
any Guarantor or any respective successor corporation or limited partnership
that shall theretofore have become such in the manner prescribed in this
SECTION 11.6 from its liability under this Agreement or the Notes.

11.7. RESTRICTED INVESTMENTS.

No Helen of Troy Entity will or will permit any of its
Subsidiaries to make or permit to remain outstanding Restricted Investments
that in the aggregate at any time exceed 25% of Consolidated Net Worth,
provided, however, that Restricted Investments that are not (i) strategic
Investments in equity interests in a Person, or (ii) strategic loans to a
Person with respect to which Ultimate Parent, the Company or such other
Subsidiary making such loan, as the case may be, also has a strategic
Investment in equity interests of such Person, shall not in the aggregate at
any time exceed 10% of Consolidated Net Worth. As used in this SECTION 11.7,
the term "STRATEGIC" shall mean motivated by purposes reasonably related to the
business of the Company or Ultimate Parent, and in no event, by speculative
purposes.

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11.8. TRANSFER OF LICENSES.

No Helen of Troy Entity will or will permit any of its
Subsidiaries to assign or otherwise transfer any of the Licenses, in whole or
in part, to any Person, except that the Company may transfer any of the
Licenses to HOT-Barbados if, and only if, (i) at the time of such transfer no
Default or Event of Default has occurred and is continuing or would result from
such transfer and (ii) at the time of such transfer the Company is a Subsidiary
of HOT-Barbados.

12. EVENTS OF DEFAULT.

An "EVENT OF DEFAULT" shall exist if any of the following
conditions or events shall occur and be continuing:

(a) the Company or any Guarantor defaults in the payment of
any principal or Make-Whole Amount, if any, on any Note when the same becomes
due and payable, whether at maturity or at a date fixed for prepayment or
purchase or by declaration or otherwise; or

(b) the Company or any Guarantor defaults in the payment of
any interest on any Note for more than five days after the same becomes due and
payable; or

(c) any Guarantor defaults in the performance of or
compliance with any term contained in SECTION 10.6(C), or any Helen of Troy
Entity defaults in the performance of or compliance with any term contained in
SECTION 11.1, 11.2, 11.3, 11.4, or 11.6; or

(d) the Company or any Guarantor defaults in the
performance of or compliance with any term contained herein (other than those
referred to in paragraphs (a), (b) and (c) of this SECTION 12), that is
applicable to it, and such default is not remedied within 30 days after the
earlier of (i) a Responsible Officer of the Company or such Guarantor obtaining
actual knowledge of such default and (ii) the Company or such Guarantor
receiving written notice of such default from any holder of a Note (any such
written notice to be identified as a "NOTICE OF DEFAULT" and to refer
specifically to this paragraph (d) of SECTION 12); or

(e) any representation or warranty made in writing by or on
behalf of the Company or any Guarantor or by any officer of the Company or any
Guarantor in this Agreement or in any writing furnished in connection with the
transactions contemplated hereby or in any writing furnished in connection with
the transactions contemplated hereby or thereby, proves to have been false or
incorrect in any material respect on the date as of which made; or

(f) (i) Ultimate Parent, the Company or any other
Subsidiary is in default (as principal or as guarantor or other surety) in the
payment of any principal of or premium or interest on any Indebtedness that is
outstanding in an aggregate principal amount of at least $1,000,000 beyond any
period of grace provided with respect thereto, or (ii) Ultimate Parent, the
Company

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or any other Subsidiary is in default in the performance of or compliance with
any term of any evidence of any Indebtedness in an aggregate outstanding
principal amount of at least $1,000,000 or of any mortgage, indenture or other
agreement relating thereto or any other condition exists, and as a consequence
of such default or condition such Indebtedness has become, or has been
declared, due and payable before its stated maturity or before its regularly
scheduled dates of payment, or (iii) as a consequence of the occurrence or
continuation of any event or condition (other than the passage of time or the
right of the holder of Indebtedness to convert such Indebtedness into equity
interests), Ultimate Parent, the Company or any other Subsidiary has become
obligated to purchase or repay Indebtedness before its regular maturity or
before its regularly scheduled dates of payment in an aggregate outstanding
principal amount of at least $1,000,000; or

(g) Ultimate Parent, the Company or any other Subsidiary
(i) is generally not paying, or admits in writing its inability to pay, its
debts as they become due, (ii) files, or consents by answer or otherwise to the
filing against it of, a petition for relief or reorganization or arrangement or
any other petition in bankruptcy, for liquidation or to take advantage of any
bankruptcy, insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv)
consents to the appointment of a custodian, receiver, trustee or other officer
with similar powers with respect to it or with respect to any substantial part
of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi)
takes corporate or partnership action for the purpose of any of the foregoing;
or

(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by Ultimate Parent,
the Company or any other Subsidiary, a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, or constituting an order for relief or
approving a petition for relief or reorganization or any other petition in
bankruptcy or for liquidation or to take advantage of any bankruptcy or
insolvency law of any jurisdiction, or ordering the dissolution, winding-up or
liquidation of Ultimate Parent, the Company or any other Subsidiary, or any
such petition shall be filed against Ultimate Parent, the Company or any other
Subsidiary and such petition shall not be dismissed within 45 days; or

(i) a final judgment or judgments for the payment of money
aggregating in excess of $1,000,000 are rendered against one or more of
Ultimate Parent, the Company and the other Subsidiaries and which judgments are
not, within 45 days after entry thereof, bonded, discharged or stayed pending
appeal, or are not discharged within 45 days after the expiration of such stay;
or

(j) if (i) any Plan shall fail to satisfy the minimum
funding standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is sought or
granted under section 412 of the Code, (ii) a notice of intent to terminate any
Plan shall have been or is reasonably expected to be filed with the PBGC or the

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PBGC shall have instituted proceedings under ERISA section 4042 to terminate or
appoint a trustee to administer any Plan or the PBGC shall have notified the
Company or any ERISA Affiliate that a Plan may become a subject of any such
proceedings, (iii) the aggregate "AMOUNT OF UNFUNDED BENEFIT LIABILITIES"
(within the meaning of section 4001(a)(18) of ERISA) under all Plans,
determined in accordance with Title IV of ERISA, shall exceed $1,000,000, (iv)
the Company or any ERISA Affiliate shall have incurred or is reasonably
expected to incur any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit
plans, (v) the Company or any ERISA Affiliate withdraws from any Multiemployer
Plan, or (vi) Ultimate Parent or any Subsidiary establishes or amends any
employee welfare benefit plan that provides post-employment welfare benefits in
a manner that would increase the liability of Ultimate Parent or any Subsidiary
thereunder; and any such event or events described in clauses (i) through (vi)
above, either individually or together with any other such event or events,
could reasonably be expected to have a Material Adverse Effect. As used in
this SECTION 12(J), the terms "EMPLOYEE BENEFIT PLAN" and "EMPLOYEE WELFARE
BENEFIT PLAN" shall have the respective meanings assigned to such terms in
section 3 of ERISA; or

(k) if any of the Licenses shall expire and not be renewed
or shall be otherwise terminated.

13. REMEDIES ON DEFAULT, ETC.

13.1. ACCELERATION.

(a) If an Event of Default with respect to any Helen of
Troy Entity described in paragraph (g) or (h) of SECTION 12 (other than an
Event of Default described in clause (i) of paragraph (g) or described in
clause (vi) of paragraph (g) by virtue of the fact that such clause encompasses
clause (i) of paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.

(b) If any other Event of Default has occurred and is
continuing, the Required Holders may at any time at their option, by notice or
notices to the Company or the Guarantors, declare all the Notes then
outstanding to be immediately due and payable.

(c) If any Event of Default described in paragraph (a) or
(b) of SECTION 12 has occurred and is continuing, any holder or holders of
Notes at the time outstanding affected by such Event of Default may at any
time, at its or their option, by notice or notices to the Company or the
Guarantors, declare all the Notes held by it or them to be immediately due and
payable.

Upon any Notes becoming due and payable under this SECTION
13.1, whether automatically or by declaration, such Notes will forthwith mature
and the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by applicable

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law), shall all be immediately due and payable, in each and every case without
presentment, demand, protest or further notice, all of which are hereby waived.
Each of the Company and the Guarantors acknowledges, and the parties hereto
agree, that each holder of a Note has the right to maintain its investment in
the Notes free from repayment by the Company or the Guarantors (except as
herein specifically provided for) and that the provision for payment of a Make-
Whole Amount by the Company and the Guarantors in the event that the Notes are
prepaid or purchased or are accelerated as a result of an Event of Default is
intended to provide compensation for the deprivation of such right under such
circumstances.

13.2. OTHER REMEDIES.

If any Default or Event of Default has occurred and is
continuing, and irrespective of whether any Notes have become or have been
declared immediately due and payable under SECTION 13.1, the holder of any Note
at the time outstanding may proceed to protect and enforce the rights of such
holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in
any Note, or for an injunction against a violation of any of the terms hereof
or thereof, or in aid of the exercise of any power granted hereby or thereby or
by law or otherwise.

13.3. RESCISSION.

At any time after any Notes have been declared due and payable
pursuant to clause (b) or (c) of SECTION 13.1, the Required Holders by written
notice to the Company or the Guarantors, may rescind and annul any such
declaration and its consequences if (a) the Company or the Guarantors have paid
all overdue interest on the Notes, all principal of and Make-Whole Amount, if
any, on any Notes that are due and payable and are unpaid other than by reason
of such declaration, and all interest on such overdue principal and Make-Whole
Amount, if any, and (to the extent permitted by applicable law) any overdue
interest in respect of the Notes, at the Default Rate, (b) all Events of
Default and Defaults, other than non-payment of amounts that have become due
solely by reason of such declaration, have been cured or have been waived
pursuant to SECTION 19, and (c) no judgment or decree has been entered for the
payment of any monies due pursuant hereto or to the Notes. No rescission and
annulment under this SECTION 13.3 will extend to or affect any subsequent Event
of Default or Default or impair any right consequent thereon.

13.4. NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC.

No course of dealing and no delay on the part of any holder of
any Note in exercising any right, power or remedy shall operate as a waiver
thereof or otherwise prejudice such holder's rights, powers or remedies. No
right, power or remedy conferred by this Agreement or by any Note upon any
holder thereof shall be exclusive of any other right, power or remedy referred
to herein or therein or now or hereafter available at law, in equity, by
statute or otherwise. Without limiting the obligations of the Company or the
Guarantors under SECTION 17, the

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Company or the Guarantors will pay to the holder of each Note on demand such
further amount as shall be sufficient to cover all costs and expenses of such
holder incurred in any enforcement or collection under this SECTION 13,
including, without limitation, reasonable attorneys' fees, expenses and
disbursements.

14. GUARANTY.

14.1. GUARANTY.

The Guarantors hereby irrevocably, absolutely,
unconditionally, jointly and severally, guarantee unto the holders of the Notes
(i) the full and prompt payment of the principal of, Make-Whole Amount, if any,
interest and all other amounts due with respect to the Notes from time to time
outstanding, as and when such amounts shall become due and payable, whether by
lapse of time, upon redemption, prepayment or purchase (including, without
limitation, any Agreed Put Consideration), by extension or by acceleration or
declaration or otherwise (including (to the extent legally enforceable)
interest due on overdue payments of principal, Make-Whole Amount, if any, or
interest at the rate set forth in the Notes or any other amounts due
thereunder) in coin or currency of the United States of America which at the
time of payment or demand therefor shall be legal tender for the payment of
public and private debts, (ii) the full and prompt payment of any fees and
expenses incurred in connection with the Facility, including, without
limitation, any Delayed Delivery Fee or Cancellation Fee, (iii) the full and
prompt performance and observance by the Company of each and all of the
obligations, covenants and agreements required to be performed or owed by the
Company under the terms of the Notes and this Agreement, and (iv) the full and
prompt payment, upon demand by any holder of any Note of all costs and
expenses, legal or otherwise (including reasonable attorneys' fees), if any, as
shall have been expended or incurred in the protection or enforcement of any
right or privilege under the Notes or this Agreement or in the protection or
enforcement of any rights, privileges or liabilities under this guaranty or in
any consultation or action in connection therewith or herewith.

14.2. GUARANTY OF PAYMENT AND PERFORMANCE.

This is a guaranty of payment and performance and not a
guaranty of collection, and the Guarantors hereby waive, to the fullest extent
permitted by law, any right to require that any action on or in respect of any
Note or this Agreement be brought against the Company or that resort be had to
any direct or indirect security for the Notes or for this guaranty or any other
remedy. Any holder of any Note may, at its option, proceed hereunder against
any Guarantor in the first instance to collect monies when due, the payment of
which is guaranteed hereby, without first proceeding against the Company or any
other Person and without first resorting to any direct or indirect security for
the Notes, or for this guaranty or any other remedy. The liability of the
Guarantors hereunder shall in no way be affected or impaired by any acceptance
by any holder of any Note of any direct or indirect security for, or other
guaranties of, any indebtedness, liability or obligation of the Company or any
other Person to any holder of any Note or by any failure,

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delay, neglect or omission by any holder of any Note to realize upon or protect
any such indebtedness, liability or obligation or any notes or other
instruments evidencing the same or any direct or indirect security therefor or
by any approval, consent, waiver, or other action taken, or omitted to be taken
by any such holder.

14.3. GENERAL PROVISIONS RELATING TO THE GUARANTY.

(a) The Guarantors hereby consent and agree that any holder
or holders of any Notes from time to time, with or without any further notice
to or assent from any Guarantor may, without in any manner affecting the
liability of the Guarantors under this guaranty, and upon such terms and
conditions as any such holder or holders may deem advisable:

(i) extend in whole or in part (by renewal or
otherwise), modify, change, compromise, release or extend the
duration of the time for the performance or payment of any
indebtedness, liability or obligation of the Company or of any
other Person secondarily or otherwise liable for any
indebtedness, liability or obligations of the Company on the
Notes, or waive any default with respect thereto, or waive,
modify, amend or change any provision of any other
instruments; provided that the procedures, if any, contained
in such instruments to extend, modify, change, compromise,
release, waive or amend the provisions of the relevant
instruments relating to any such indebtedness shall be
complied with; or

(ii) sell, release, surrender, modify, impair,
exchange or substitute any and all property, of any nature and
from whomsoever received, held by, or for the benefit of, any
such holder as direct or indirect security for the payment or
performance of any indebtedness, liability or obligation of
the Company or of any other Person secondarily or otherwise
liable for any indebtedness, liability or obligation of the
Company on the Notes; or

(iii) settle, adjust or compromise any claim of the
Company against any other Person secondarily or otherwise
liable for any indebtedness, liability or obligation of the
Company on the Notes.

The Guarantors hereby ratify and confirm any such extension, renewal,
change, sale, release, waiver, surrender, exchange, modification, amendment,
impairment, substitution, settlement, adjustment or compromise and that the
same shall be binding upon them, and hereby waives, to the fullest extent
permitted by law, any and all defenses, counterclaims or offsets which it might
or could have by reason thereof, it being understood that the Guarantors shall
at all times be bound by this guaranty and remain liable hereunder.

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(b) The Guarantors hereby waive, to the fullest extent
permitted by law: (i) notice of acceptance of this guaranty by the holders of
the Notes or of the creation, renewal or accrual of any liability of the
Company present or future, or of the reliance of such holders upon this
guaranty (it being understood that every indebtedness, liability and obligation
arising under the Notes or this Agreement shall conclusively be presumed to
have been created, contracted or incurred in reliance upon the execution of
this guaranty); (ii) demand of payment by any holder of any Note from the
Company or any other Person indebted in any manner on or for any of the
indebtedness, liabilities or obligations hereby guaranteed; and (iii)
presentment for the payment by any holder of any Note or any other Person of
the Notes or any other instrument, protest thereof and notice of its dishonor
to any party thereto and to the Guarantors. The obligations of the Guarantors
under this guaranty and the rights of any holder of any Note to enforce such
obligations by any proceedings, whether by action at law, suit in equity or
otherwise, shall not be subject to any reduction, limitation, impairment or
termination, whether by reason of any claim of any character whatsoever or
otherwise and shall not be subject to any defense, set-off, counterclaim (other
than any compulsory counterclaim), recoupment or termination whatsoever.

(c) The obligations of the Guarantors hereunder shall be
binding upon each of the Guarantors and its respective successors and assigns,
and shall remain in full force and effect irrespective of:

(i) the genuineness, validity, regularity or
enforceability of the Notes or this Agreement, or any of the
terms of any thereof, the continuance of any obligation on the
part of the Company or any other Person on the Notes or under
this Agreement, or the power or authority or the lack of power
or authority of the Company to issue the Notes or execute and
deliver this Agreement, or to perform any of its obligations
thereunder or the existence or continuance of the Company or
any other Person as a legal entity; or

(ii) any default, failure or delay, willful or
otherwise, in the performance by the Company or any other
Person of any obligations of any kind or character whatsoever
of the Company or any other Person (including, without
limitation, the obligations and undertakings of the Company or
any other Person under the Notes or this Agreement); or

(iii) any creditors' rights, bankruptcy,
receivership or other insolvency proceeding of the Company or
any other Person or in respect of the property of the Company
or any other Person or any merger, consolidation,
reorganization, dissolution, liquidation, the sale of all or
substantially all of the assets of or winding up of the
Company or any other Person; or

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(iv) impossibility or illegality of performance on
the part of the Company or any other Person of its obligations
under the Notes, this Agreement, or any other instruments; or

(v) in respect of the Company or any other
Person, any change of circumstances, whether or not foreseen
or foreseeable, whether or not imputable to the Company or any
other Person, or other impossibility of performance through
fire, explosion, accident, labor disturbance, floods,
droughts, embargoes, wars (whether or not declared), civil
commotion, acts of God or the public enemy, delays or failure
of suppliers or carriers, inability to obtain materials,
action of any Federal or state regulatory body or agency,
change of law or any other causes affecting performance, or
any other force majeure, whether or not beyond the control of
the Company or any other Person and whether or not of the kind
hereinbefore specified; or

(vi) any attachment, claim, demand, charge, lien,
order, process, encumbrance or any other happening or event or
reason, similar or dissimilar to the foregoing, or any
withholding or diminution at the source, by reason of any
taxes, assessments, expenses, indebtedness, obligations or
liabilities of any character, foreseen or unforeseen, and
whether or not valid, incurred by or against any Person, or
any claims, demands, charges or liens of any nature, foreseen
or unforeseen, incurred by any Person, or against any sums
payable under this guaranty, so that such sums would be
rendered inadequate or would be unavailable to make the
payments herein provided; or

(vii) any order, judgment, decree, ruling or
regulation (whether or not valid) of any court of any nation
or of any political subdivision thereof or any body, agency,
department, official or administrative or regulatory agency of
any thereof or any other action, happening, event or reason
whatsoever which shall delay, interfere with, hinder or
prevent, or in any way adversely affect, the performance by
any party of its respective obligations under the Notes, this
Agreement or any instrument relating thereto; or

(viii) the failure of any Guarantor to receive any
benefit from or as a result of its execution, delivery and
performance of this Agreement, including this SECTION 14; or

(ix) any failure or lack of diligence in
collection or protection, failure in presentment or demand for
payment, protest, notice of protest, notice of default and of
nonpayment, any failure to give notice to any Guarantor of
failure of the Company or any other Person to keep and perform
any obligation, covenant or agreement under the terms of the
Notes or this Agreement, or failure to resort for

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payment to the Company or to any other Person or to any other
guaranty or to any property, security, liens or other rights
or remedies; or

(x) the acceptance of any additional security or
other guaranty, the advance of additional money to the Company
or any other Person, the renewal or extension of the Notes or
amendments, modifications, consents or waivers with respect to
the Notes or this Agreement, or the sale, release,
substitution or exchange of any security for the Notes; or

(xi) any defense whatsoever that the Company or
any other Person might have to the payment of the Notes
(principal, Make-Whole Amount, if any, or interest or any
other amounts due thereunder), other than payment in cash
thereof, or to the performance or observance of any of the
provisions of this Agreement, whether through the satisfaction
or purported satisfaction by the Company or any other Person
of its debts due to any cause such as bankruptcy, insolvency,
receivership, merger, consolidation, reorganization,
dissolution, liquidation, winding-up or otherwise; or

(xii) any act or failure to act with regard to the
Notes or this Agreement, or anything which might vary the risk
of any Guarantor; or

(xiii) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, any
Guarantor in respect of the obligations of the Guarantors
under this guaranty;

provided that the specific enumeration of the above-mentioned acts, failures or
omissions shall not be deemed to exclude any other acts, failures or omissions,
though not specifically mentioned above, it being the purpose and intent of
this guaranty that the obligations of the Guarantors shall be absolute and
unconditional and shall not be discharged, impaired or varied except by the
payment of (x) the principal of, Make-Whole Amount, if any, and interest on the
Notes in accordance with their respective terms whenever the same shall become
due and payable as in the Notes provided and (y) any fee or expense incurred in
connection with the Facility including, without limitation, any Delayed
Delivery Fee or Cancellation Fee, at the place specified in and all in the
manner and with the effect provided in the Notes and this Agreement, as amended
or modified from time to time. Without limiting the foregoing, it is
understood that repeated and successive demands may be made and recoveries may
be had hereunder as and when, from time to time, the Company shall default
under the terms of the Notes or this Agreement and that notwithstanding
recovery hereunder for or in respect of any given default or defaults by the
Company under the Notes or this Agreement, this guaranty shall remain in full
force and effect and shall apply to each and every subsequent default.

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(d) All rights of any holder of any Note may be transferred
or assigned at any time and shall be considered to be transferred or assigned
at any time or from time to time upon the transfer of such Note whether with or
without the consent of or notice to the Guarantors under this guaranty or to
the Company.

(e) The Guarantors hereby, jointly and severally,
subordinate to the rights of the holders of Notes under this Agreement and the
Notes and agree to defer any assertion, until such time as the Notes have been
indefeasibly paid in cash in full, of any claim or other rights that they may
now or hereafter acquire against the Company that arise from the existence,
payment, performance or enforcement of the Guarantors' obligations under this
guaranty, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of any holder or holders of Notes against
the Company, whether or not such claim, remedy or right arises in equity or
under contract, statute or common law, including, without limitation, the right
to take or receive from the Company, directly or indirectly, in cash or other
property or by set-off or in any other manner, payment or security on account
of such claim, remedy or right. If any amount shall be paid to any Guarantor
in violation of the preceding sentence at any time prior to the later of the
indefeasible cash payment in full of the Notes and all other amounts payable
under this Agreement and this guaranty, such amount shall be held in trust for
the benefit of the holders of the Notes and shall forthwith be paid to the
holders of the Notes to be credited and applied to the amounts due or to become
due with respect to the Notes and all other amounts payable under this
Agreement and this guaranty, whether matured or unmatured. The Guarantors
acknowledge that they will receive material direct and indirect benefits from
the financing arrangements contemplated by this Agreement and that the
agreement set forth in this paragraph is knowingly made in contemplation of
such benefits.

(f) The Guarantors agree that to the extent the Company or
any other Person makes any payment on any Note, which payment or any part
thereof is subsequently invalidated, voided, declared to be fraudulent or
preferential, set aside, recovered, rescinded or is required to be retained by
or repaid to a trustee, receiver, or any other Person under any bankruptcy
code, common law, or equitable cause, then and to the extent of such payment,
the obligation or the part thereof intended to be satisfied shall be revived
and continued in full force and effect with respect to the Guarantors'
obligations hereunder, as if said payment had not been made. The liability of
the Guarantors hereunder shall not be reduced or discharged, in whole or in
part, by any payment to any holder of any Note from any source that is
thereafter paid, returned or refunded in whole or in part by reason of the
assertion of a claim of any kind relating thereto, including, but not limited
to, any claim for breach of contract, breach of warranty, preference,
illegality, invalidity, or fraud asserted by any account debtor or by any other
Person.

(g) No holder of any Note shall be under any obligation (i)
to marshall any assets in favor of any Guarantor or in payment of any or all of
the liabilities of the Company under or in respect of the Notes or the
obligations of the Guarantors hereunder or (ii) to pursue any other

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remedy that the Guarantors may or may not be able to pursue themselves and that
may lighten the Guarantors' burden, any right to which the Guarantors hereby
expressly waive.

15. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

15.1. REGISTRATION OF NOTES.

The Company shall keep at its principal executive office a
register for the registration and registration of transfers of Notes. The name
and address of each holder of one or more Notes, each transfer thereof and the
name and address of each transferee of one or more Notes shall be registered in
such register. Prior to due presentment for registration of transfer, the
Person in whose name any Note shall be registered shall be deemed and treated
as the owner and holder thereof for all purposes hereof, and the Company shall
not be affected by any notice or knowledge to the contrary. The Company shall
give to any holder of a Note that is an Institutional Investor promptly upon
request therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.

15.2. TRANSFER AND EXCHANGE OF NOTES.

Upon surrender of any Note at the principal executive office
of the Company for registration of transfer or exchange (and in the case of a
surrender for registration of transfer, duly endorsed or accompanied by a
written instrument of transfer duly executed by the registered holder of such
Note or his attorney duly authorized in writing and accompanied by the address
for notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one
or more new Notes of the same Series as the Notes so surrendered (as requested
by the holder thereof) in exchange therefor, in an aggregate principal amount
equal to the unpaid principal amount of the surrendered Note. Each such new
Note shall be payable to such Person as such holder may request and shall be
substantially in the form of EXHIBIT 1-A or 1-B, as the case may be. Each such
new Note shall be dated and bear interest from the date to which interest shall
have been paid on the surrendered Note or dated the date of the surrendered
Note if no interest shall have been paid thereon. Each installment of
principal payable on each installment date upon each new Note issued upon any
such transfer or exchange shall be in the same proportion to the unpaid
principal amount of such new Note as the installment of principal payable on
such date on the Note surrendered for registration of transfer or exchange bore
to the unpaid principal amount of such Note. No reference need be made in any
new Note to any installment or installments of principal previously due and
paid upon the Notes surrendered for registration of transfer or exchange. The
Company may require payment of a sum sufficient to cover any stamp tax or
governmental charge imposed in respect of any such transfer of Notes. Notes
shall not be transferred in denominations of less than $100,000, provided that
if necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than $100,000. Any

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transferee, by its acceptance of a Note registered in its name (or the name of
its nominee), shall be deemed to have made the representation set forth in
SECTION 7.2.

15.3. PROHIBITED TRANSFERS

Notwithstanding any other provision in this Agreement and
provided no Default or Event of Default shall have occurred and be continuing,
a holder of any interest in a Note will not sell, transfer, encumber, gift,
donate, assign, pledge, grant, convey, hypothecate or otherwise dispose of any
interest in a Note, whether voluntary or involuntary, including by operation of
law, by court order, by judicial process or by foreclosure, levy or attachment,
to any person who is involved in the manufacturing or marketing of personal
care products, other than (i) an Institutional Investor of the type described
in clause (a) or clause (c) of the definition of "INSTITUTIONAL INVESTOR" set
forth in SCHEDULE B, and (ii) any other Person with respect to which such
holder has no actual knowledge of involvement by such Person in the
manufacturing and marketing of personal care products.

15.4. REPLACEMENT OF NOTES.

Upon receipt by the Company of evidence reasonably
satisfactory to it of the ownership of and the loss, theft, destruction or
mutilation of any Note (which evidence shall be, in the case of an
Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and

(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note is, or
is a nominee for, Prudential or a Prudential Affiliate or another holder of a
Note with a minimum net worth of at least $100,000,000, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory), or

(b) in the case of mutilation, upon surrender and
cancellation thereof, the Company at its own expense shall execute and deliver,
in lieu thereof, a new Note of the same Series as the Note lost, stolen,
destroyed, or mutilated, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.

16. PAYMENTS ON NOTES.

16.1. PLACE OF PAYMENT.

Subject to SECTION 16.2, payments of (i) principal, Make-Whole
Amount, if any, and interest becoming due and payable on the Notes and (ii) any
fee or expense incurred in connection with the Facility including, without
limitation, any Cancellation Fee or Delayed

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Delivery Fee, shall be made in New York, New York at the principal office of
The Bank of New York in such jurisdiction. The Company may at any time, by
notice to each holder of a Note, change the place of payment of the Notes and
such fees and expenses so long as such place of payment shall be either the
principal office of the Company in such jurisdiction or the principal office of
a bank or trust company in such jurisdiction.

16.2. HOME OFFICE PAYMENT.

So long as Prudential, a Prudential Affiliate or a nominee of
either of them shall be the holder of any Note, and notwithstanding anything
contained in SECTION 16.1 or in such Note to the contrary, the Company will pay
all sums becoming due on such Note for (x) principal, Make-Whole Amount, if
any, and interest and (y) any fee or expense incurred in connection with the
Facility including, without limitation, any Cancellation Fee or Delayed
Delivery Fee, by the method and at the address specified for such purpose below
Prudential's name in SCHEDULE A, or by such other method or at such other
address as Prudential or such Prudential Affiliate shall have from time to time
specified to the Company or the Guarantors in writing for such purpose, without
the presentation or surrender of such Note or the making of any notation
thereon, except that upon written request of the Company made concurrently with
or reasonably promptly after payment or prepayment in full of any Note,
Prudential or such Prudential Affiliate shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to SECTION 16.1. Prior to any sale or other
disposition of any Note held by Prudential, a Prudential Affiliate or a nominee
of either of them, Prudential or such Prudential Affiliate will, at its
election, either endorse thereon the amount of principal paid thereon and the
last date to which interest has been paid thereon or surrender such Note to the
Company in exchange for a new Note or Notes pursuant to SECTION 15.2. The
Company and the Guarantors will afford the benefits of this SECTION 16.2 to any
Institutional Investor that is the direct or indirect transferee of any Note
purchased by Prudential or a Prudential Affiliate under this Agreement and that
has made the same agreement relating to such Note as Prudential or such
Prudential Affiliate has made in this SECTION 16.2.

17. EXPENSES, ETC.

17.1. TRANSACTION EXPENSES.

Whether or not the transactions contemplated hereby are
consummated, the Company and the Guarantors will pay all costs and expenses
(including reasonable attorneys' fees of a special counsel and, if reasonably
required, local or other counsel) incurred by Prudential and each holder of a
Note in connection with such transactions and in connection with any
amendments, waivers or consents under or in respect of this Agreement or the
Notes (whether or not such amendment, waiver or consent becomes effective),
including, without limitation: (a) the costs and expenses incurred in enforcing
or defending (or determining whether or how to enforce

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or defend) any rights under this Agreement or the Notes or in responding to any
subpoena or other legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of being a holder of
any Note, and (b) the costs and expenses, including financial advisors' fees,
incurred in connection with the insolvency or bankruptcy of Ultimate Parent,
the Company or any other Subsidiary or in connection with any work-out or
restructuring of the transactions contemplated hereby and by the Notes. The
Company and the Guarantors will pay, and will save Prudential and each other
holder of a Note harmless from, all claims in respect of any fees, costs or
expenses if any, of brokers and finders (other than those retained by
Prudential or a Prudential Affiliate). The obligations of the Company and the
Guarantors under this SECTION 17.1 are joint and several.

17.2. SURVIVAL.

The obligations of the Company and the Guarantors under this
SECTION 17 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.

18. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

All representations and warranties contained herein shall
survive the execution and delivery of this Agreement and the Notes, the
purchase or transfer by Prudential or any Prudential Affiliate of any Note or
portion thereof or interest therein and the payment of any Note, and may be
relied upon by any subsequent holder of a Note, regardless of any investigation
made at any time by or on behalf of Prudential or any other holder of a Note.
All statements contained in any certificate or other instrument delivered by or
on behalf of the Company or any Guarantor pursuant to this Agreement shall be
deemed representations and warranties of the Company or such Guarantor, as the
case may be, under this Agreement. Subject to the preceding sentence, this
Agreement and the Notes embody the entire agreement and understanding among
Prudential, the Company and the Guarantors and supersede all prior agreements
and understandings relating to the subject matter hereof.

19. AMENDMENT AND WAIVER.

19.1. REQUIREMENTS.

This Agreement and the Notes may be amended, and the
observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of
the Company, the Guarantors and the Required Holders, except that (a) no
amendment or waiver of any of the provisions of SECTION 1, 2, 3 (except insofar
as any such amendment or waiver would affect any rights or obligations with
respect to the purchase and sale of Notes which shall have become Accepted
Notes prior to such amendment or waiver), 4, 5, 6

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or 7 hereof, or any defined term (as it is used therein), will be effective as
to Prudential or a Prudential Affiliate unless consented to by Prudential or
such Prudential Affiliate in writing, and (b) no amendment or waiver may,
without the written consent of the holder of each Note at the time outstanding
affected thereby, (i) subject to the provisions of SECTION 13 relating to
acceleration or rescission, change the amount or time of any prepayment or
payment of principal of, or reduce the rate or change the time of payment or
method of computation of interest or of the Make-Whole Amount on, the Notes,
(ii) change the percentage of the principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver, or (iii) amend
any of SECTIONS 9, 12(A), 12(B), 13, 14, 19 OR 22.

19.2. SOLICITATION OF HOLDERS OF NOTES.

(a) Solicitation. The Company and the Guarantors will
provide each holder of the Notes (irrespective of the amount of Notes then
owned by it) with sufficient information, sufficiently far in advance of the
date a decision is required, to enable such holder to make an informed and
considered decision with respect to any proposed amendment, waiver or consent
in respect of any of the provisions hereof or of the Notes. The Company and
the Guarantors will deliver executed or true and correct copies of each
amendment, waiver or consent effected pursuant to the provisions of this
SECTION 19 to each holder of outstanding Notes promptly following the date on
which it is executed and delivered by, or receives the consent or approval of,
the requisite holders of Notes.

(b) Payment. Neither the Company nor any of the Guarantors
will directly or indirectly pay or cause to be paid any remuneration, whether
by way of supplemental or additional interest, fee or otherwise, or grant any
security, to any holder of Notes as consideration for or as an inducement to
the entering into by any holder of Notes or any waiver or amendment of any of
the terms and provisions hereof unless such remuneration is concurrently paid,
or security is concurrently granted, on the same terms, ratably to each holder
of Notes then outstanding even if such holder did not consent to such waiver or
amendment.

19.3. BINDING EFFECT, ETC.

Any amendment or waiver consented to as provided in this
SECTION 19 applies equally to all holders of Notes and is binding upon them and
upon each future holder of any Note and upon the Company and the Guarantors
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any
obligation, covenant, agreement, Default or Event of Default not expressly
amended or waived or impair any right consequent thereon. No course of dealing
between the Company or any Guarantor and the holder of any Note nor any delay
in exercising any rights hereunder or under any Note shall operate as a waiver
of any rights of any holder of such Note. As used herein, the term "THIS
AGREEMENT" and references thereto shall mean this Agreement as it may from time
to time be amended or supplemented.

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19.4. NOTES HELD BY GUARANTORS, ETC.

Solely for the purpose of determining whether the holders of
the requisite percentage of the aggregate principal amount of Notes then
outstanding approved or consented to any amendment, waiver or consent to be
given under this Agreement or the Notes, or have directed the taking of any
action provided herein or in the Notes to be taken upon the direction of the
holders of a specified percentage of the aggregate principal amount of Notes
then outstanding, Notes directly or indirectly owned by any Guarantor, the
Company or any of the other Affiliates of the Company shall be deemed not to be
outstanding.

20. NOTICES.

All notices and communications provided for hereunder (other
than communications provided for under SECTION 3) shall be in writing and sent
(a) by telecopy if the sender on the same day sends a confirming copy of such
notice by a recognized overnight delivery service (charges prepaid), or (b) by
registered or certified mail with return receipt requested (postage prepaid),
or (c) by a recognized overnight delivery service (with charges prepaid). Any
such notice must be sent:

(a) if to Prudential or its nominee, to Prudential or such
nominee at the address specified for such communications in SCHEDULE A, or at
such other address as Prudential or such nominee shall have specified to the
Company or the Guarantors in writing,

(b) if to any other holder of any Note, to such holder at
such address as such other holder shall have specified to the Company and the
Guarantors in writing,

(c) if to the Company, to it at 6827 Market Avenue, El
Paso, Texas 79915 to the attention of the Chairman of the Board and the
Secretary, or at such other address as the Company shall have specified to the
holder of each Note in writing,

(d) if to the Guarantors (other than Limited Partner), to
them at 6827 Market Avenue, El Paso, Texas 79915 to the attention of the
Chairman and the Secretary, or at such other address as the Guarantors (other
than Limited Partner) shall have specified to the holder of each Note in
writing, or

(e) if to Limited Partner, at 1325 Airmotive Way, Reno,
Nevada 89502 to the attention of the Chairman of the Board and the Secretary,
or at such other address as Limited Partner shall have specified to the holder
of each Note in writing.

Any communication pursuant to SECTION 3 shall be made by the
method specified for such communication in SECTION 3, and shall effective to
create any rights or obligations under this Agreement only if, in the case of a
telephone communication, an Authorized Officer of the

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party conveying the information and the party receiving the information are
parties to the telephone call, and in the case of a telecopier
telecommunication, the communication is signed by an Authorized Officer of the
party conveying the information, addressed to the attention of an Authorized
Officer of the party receiving the information, and in fact received at the
telecopier terminal the number of which is listed for the party receiving the
communication in SCHEDULE A or such other telecopier terminal as the party
receiving the information shall specify in writing to the party sending such
information.

Except as otherwise specified in this Section, notices under this SECTION 20
will be deemed given only when actually received.

21. REPRODUCTION OF DOCUMENTS.

This Agreement and all documents relating thereto, including,
without limitation, (a) consents, waivers and modifications that may hereafter
be executed, (b) documents received by Prudential at the Initial Closing and by
Prudential or a Prudential Affiliate on each Closing Day (except the Notes
themselves) and from time to time under the Original Agreement, and (c)
financial statements, certificates and other information previously or
hereafter furnished to Prudential or any other holder of a Note, may be
reproduced by Prudential, such Prudential Affiliate or such other holder, as
the case may be, by any photographic, photostatic, microfilm, microcard,
miniature photographic or other similar process and Prudential, such Prudential
Affiliate or such other holder, as the case may be, may destroy any original
document so reproduced. Each of the Company and the Guarantors agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by Prudential, such
Prudential Affiliate or such other holder, as the case may be, in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This SECTION 21
shall not prohibit the Company, the Guarantors or any other holder of Notes
from contesting any such reproduction to the same extent that it could contest
the original, or from introducing evidence to demonstrate the inaccuracy of any
such reproduction.

22. CONFIDENTIAL INFORMATION.

For the purposes of this SECTION 22, "CONFIDENTIAL
INFORMATION" means information delivered by or on behalf of Ultimate Parent or
any Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by a
Purchaser as being confidential information of Ultimate Parent or such
Subsidiary, provided that such term does not include information that (a) was
publicly known or otherwise known to such Purchaser prior to the time of such
disclosure, (b) subsequently becomes publicly known through no act or omission
by such Purchaser or any person acting on its behalf, (c) otherwise becomes

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known to such Purchaser other than through disclosure by Ultimate Parent or any
Subsidiary or (d) constitutes financial statements delivered to such Purchaser
under SECTION 8.1 that are otherwise publicly available. Each Purchaser will
maintain the confidentiality of Confidential Information delivered to it in
accordance with procedures adopted by it in good faith to protect confidential
information of third parties delivered to it, provided that it may deliver or
disclose Confidential Information to (i) its directors, officers, employees,
agents, attorneys and affiliates (to the extent such disclosure reasonably
relates to the administration of the investment represented by its Notes), (ii)
its financial advisors and other professional advisors who agree to hold
confidential the Confidential Information substantially in accordance with the
terms of this SECTION 22, (iii) any other holder of any Note, (iv) any
Institutional Investor to which its sells or offers to sell such Note or any
part thereof or any participation therein (if such Person has agreed in writing
prior to its receipt of such Confidential Information to be bound by the
provisions of this SECTION 22), (v) any Person from which it offers to purchase
any security of the Company or Ultimate Parent (if such Person has agreed in
writing prior to its receipt of such Confidential Information to be bound by
the provisions of this SECTION 22), (vi) any federal or state regulatory
authority having jurisdiction over it, (vii) the National Association of
Insurance Commissioners or any similar organization, or any nationally
recognized rating agency that requires access to information about its
investment portfolio or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to it, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
it is a party or (z) if an Event of Default has occurred and is continuing, to
the extent it may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under its Notes and this Agreement. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this SECTION 22 as though it were a party to this
Agreement. On reasonable request by the Company or Ultimate Parent in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company and Ultimate Parent
embodying the provisions of this SECTION 22.

23. MISCELLANEOUS.

23.1. SUCCESSORS AND ASSIGNS.

All covenants and other agreements contained in this Agreement
by or on behalf of any of the parties hereto bind and inure to the benefit of
their respective successors and assigns (including, without limitation, any
subsequent holder of a Note) whether so expressed or not.

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<PAGE> 68
23.2. PAYMENTS DUE ON NON-BUSINESS DAYS.

Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or interest
on any Note that is due on a date other than a Business Day shall be made on
the next succeeding Business Day without including the additional days elapsed
in the computation of the interest payable on such next succeeding Business
Day.

23.3. WITHHOLDING TAXES.

In the event that, pursuant to SECTION 10.6, the Company or
any Guarantor is required to pay any additional amounts in connection with
Taxes, the holder of each Note to whom such payments are owed agrees to provide
the Company or such Guarantor, from time to time and upon the Company's or such
Guarantor's request, written confirmation that such holder is in fact subject
to such Taxes.

23.4. SEVERABILITY.

Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by
law) not invalidate or render unenforceable such provision in any other
jurisdiction.

23.5. CONSTRUCTION.

Each covenant contained herein shall be construed (absent
express provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance with any
other covenant. Where any provision herein refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.

23.6. COUNTERPARTS.

This Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which together shall constitute
one instrument. Each counterpart may consist of a number of copies hereof,
each signed by less than all, but together signed by all, of the parties
hereto.

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<PAGE> 69
23.7. BINDING AGREEMENT.

When this Agreement is executed and delivered by the Helen of
Troy Entities and Prudential, it shall become a binding agreement between the
Helen of Troy Entities and Prudential. This Agreement shall also inure to the
benefit of each Purchaser which shall have executed and delivered a
Confirmation of Acceptance, and each such Purchaser shall be bound by this
Agreement to the extent provided in such Confirmation of Acceptance.

23.8. GOVERNING LAW.

THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE
OF NEW YORK.

23.9. ADDITIONAL DEBT.

Subject to the terms and provisions hereof (including, but not
limited to, SECTION 11.1), the Company may, from time to time, issue and sell
additional promissory notes pursuant to agreements which may incorporate by
reference all or certain of the provisions of this Agreement. Such
incorporation by reference shall not have the effect of constituting such
promissory notes as Notes for any purpose, whether for payment, prepayment,
purchase or acceleration of the Notes, rescission of such acceleration, or the
exercise of any other amendments or waivers of the provisions hereof, or
otherwise. Persons who purchase such promissory notes shall not be considered
third-party beneficiaries of any of the terms or provisions of this Agreement
for any purpose whatsoever.

23.10. CONSENT TO JURISDICTION; SERVICE OF PROCESS.

(a) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT, THE NOTES, OR ANY OTHER DOCUMENTS OR TRANSACTIONS IN CONNECTION WITH
OR RELATING HERETO OR THERETO, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS OR ACTIONS OF THE EXISTING HOLDER, ANY SUBSEQUENT HOLDER OF A NOTE,
THE GUARANTORS, OR THE COMPANY MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW
YORK OR THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
EACH OF THE GUARANTORS AND THE COMPANY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION
OF THE AFORESAID COURTS. EACH OF THE GUARANTORS AND THE COMPANY HEREBY
IRREVOCABLY WAIVES ANY OBJECTIONS, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION
TO THE LAYING OF VENUE BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT

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<PAGE> 70
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN
SUCH RESPECTIVE JURISDICTIONS.

(b) In the case of the courts of the State of New York or
of the United States sitting in the City of New York, State of New York, each
of the Guarantors and the Company hereby irrevocably designates, appoints, and
empowers CT Corporation System (the "PROCESS AGENT") (which has consented
thereto) with offices on the date hereof at 1633 Broadway, New York, New York
10019, as agent to receive for and on behalf of the Company and the Guarantors
service of process in the State of New York. Each of the Guarantors and the
Company further agrees that such service of process may be made on the Process
Agent by personal service of a copy of the summons and complaint or other legal
process in any such legal suit, action or proceeding on the Process Agent, or
by any other method of service provided for under the applicable laws in effect
in the County of New York, State of New York, and the Process Agent hereby is
authorized and directed to accept such service for and on behalf of the Company
or any Guarantor, as the case may be, and to admit service with respect
thereto.

(c) Upon service of process being made on the Process Agent
as aforesaid, a copy of the summons and complaint or other legal process served
shall be mailed by the Process Agent to the Company or the Guarantor, as the
case may be, by air courier, at its address set forth in SECTION 20, or to such
other address as the Company or such Guarantor, as the case may be, may notify
the Process Agent in writing. Service upon the Process Agent as aforesaid
shall be deemed to be personal service on the Company or the Guarantor, as the
case may be, and shall be legal and binding upon the Company or such Guarantor,
as the case may be, for all purposes, notwithstanding any failure of the
Process Agent to mail copies of such legal process thereto, or any failure on
the part of the Company or such Guarantor, as the case may be, to receive the
same.

(d) Each of the Guarantors and the Company agrees that it
will at all times continuously maintain an agent to receive service of process
in the County of New York on its behalf. In the event that for any reason the
Process Agent or any successor thereto shall no longer serve as agent for the
Company or the Guarantors to receive service of process in the County of New
York on its behalf or the Company or any Guarantor shall have changed its
address, as the case may be, without notification thereof to the Process Agent,
the Company or such Guarantor, as the case may be, immediately after having
knowledge thereof, will irrevocably designate and appoint a substitute agent in
the City of New York, New York and advise Purchaser, or any subsequent holder
of a Note, thereof, or shall notify the Process Agent of its then current
correct address.

(e) Nothing contained in this section shall preclude
Purchaser, or any subsequent holder of a Note, from bringing any legal suit,
action or proceeding against the

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<PAGE> 71
Company or any Guarantor in the courts of any jurisdiction where the Company or
such Guarantor or any of its property or assets may be found or located.

23.11. MAXIMUM INTEREST PAYABLE.

The Company, the Guarantors, each Purchaser and any other
holders of the Notes specifically intend and agree to limit contractually the
amount of interest payable under this Agreement, the Notes and all other
instruments and agreements related hereto and thereto to the maximum amount of
interest lawfully permitted to be charged under applicable law. Therefore,
none of the terms of this Agreement, the Notes or any instrument pertaining to
or relating to this Agreement or the Notes shall ever be construed to create a
contract to pay interest at a rate in excess of the maximum rate permitted to
be charged under applicable law, and neither the Company, any Guarantor nor any
other party liable or to become liable hereunder, under the Notes, any guaranty
or under any other instruments and agreements related hereto and thereto shall
ever be liable for interest in excess of the amount determined at such maximum
rate, and the provisions of this SECTION 23.11 shall control over all other
provisions of this Agreement, any Notes, any guaranty or any other instrument
pertaining to or relating to the transactions herein contemplated. If any
amount of interest taken or received by a Purchaser or any holder of a Note
shall be in excess of said maximum amount of interest which, under applicable
law, could lawfully have been collected by such Purchaser or holder incident to
such transactions, then such excess shall be deemed to have been the result of
a mathematical error by all parties hereto and shall be refunded promptly by
the Person receiving such amount to the party paying such amount, or, at the
option of the recipient, credited ratably against the unpaid principal amount
of the Note or Notes held by such Purchaser or holder, respectively. All
amounts paid or agreed to be paid in connection with such transactions which
would under applicable law be deemed "INTEREST" shall, to the extent permitted
by such applicable law, be amortized, prorated, allocated and spread throughout
the stated term of this Agreement and the Notes. "APPLICABLE LAW" as used in
this paragraph means that law in effect from time to time which permits the
charging and collection of the highest permissible lawful, nonusurious rate of
interest on the transactions herein contemplated, and "MAXIMUM RATE" as used in
this paragraph means, with respect to each of the Notes, the maximum lawful,
nonusurious rates of interest (if any) which under applicable law may be
charged to the Company from time to time with respect to such Notes.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURE PAGE FOLLOWS.]

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<PAGE> 72
EXECUTED as of December 31, 1996.

HELEN OF TROY TEXAS
CORPORATION, a Texas corporation

By:
-------------------------------------------
Sam L. Henry
Senior Vice President, Finance

HELEN OF TROY LIMITED,
a Bermuda company

By:
-------------------------------------------
Sam L. Henry
Senior Vice President, Finance

HELEN OF TROY LIMITED,
a Barbados company

By:
-------------------------------------------
Sam L. Henry
Senior Vice President, Finance

HELEN OF TROY NEVADA
CORPORATION, a Nevada corporation

By:
-------------------------------------------
Sam L. Henry
Vice President
<PAGE> 73
HOT NEVADA INC., a Nevada corporation

By:
-------------------------------------------
Gary B. Abramovitz
President

HELEN OF TROY L.P.,
a Texas limited partnership

By: HELEN OF TROY NEVADA
CORPORATION, a Nevada
corporation, its General Partner

By:
-------------------------------------------
Sam L. Henry
Vice President

THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA

By:
-------------------------------------------
Name: Jay D. Squiers
Title: Vice President
<PAGE> 74
SCHEDULE A

INFORMATION SCHEDULE

<TABLE>
<CAPTION>
Principal Amount
of Notes to be Denominations
Name and Address of Purchaser Series Purchased of Notes
----------------------------- ------ ---------------- --------------
<S> <C> <C> <C>
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA 1996-A $40,000,000 $38,000,000 (No. R-1)
$ 2,000,000 (No. R-2)
(1) (a) All payments with respect to Series
1996-A Note No. R-1 by wire
transfer of immediately available
funds to:

Account No. 890-0304-391
The Bank of New York
New York, New York

(ABA No.: 021-000-018)

Each such wire transfer shall set
forth the name of the Company, a
reference to "7.01% Guaranteed
Senior Notes, Series 1996-A, due
January 5, 2008, Security No.
!INV5275!" and the due date and
application (as among principal,
interest and Make-Whole Amount) of
the payment being made.

</TABLE>

A-1
<PAGE> 75
(b) All payments with respect to Series
1996-A Note No. R-2 by wire
transfer of immediately available
funds to:

Account No. 890-0304-944
The Bank of New York
New York, New York

(ABA No.: 021-000-018)

Each such wire transfer shall set
forth the name of the Company, a
reference to "7.01% Guaranteed
Senior Notes, Series 1996-A , due
January 5, 2008, Security No.
!INV5276!" and the due date and
application (as among principal,
interest and Make-Whole Amount) of
the payment being made.

(2) All notices of payments and written
confirmations of such wire transfers:

The Prudential Insurance Company of
America
c/o Prudential Capital Group
Three Gateway Center
12th Floor
100 Mulberry Street
Newark, New Jersey 07102
Attention: Investment Operations
Group
(Attention: Manager)

(3) All other communications:

The Prudential Insurance Company of
America
c/o Prudential Capital Group
Texas Commerce Tower
2200 Ross Avenue, Suite 4200E
Dallas, Texas 75201
Attention: Managing Director

(4) Taxpayer Identification No.:
22-1211670

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<PAGE> 76
(5) Recipient of Telephonic or Facsimile
Prepayment Notices:

Manager, Investment Structure and
Pricing
(201) 802-6660

(6) Authorized Officers
R.A. Walker
Steven D. Arnold
Robert G. Gwin
Randall M. Kob
Jay D. Squiers

A-3
<PAGE> 77
HELEN OF TROY L.P.

(1) Address for Notices:

Helen of Troy L.P.
c/o Helen of Troy Nevada
Corporation
6829 Market Avenue
El Paso, Texas 79915
Attention: Chief Financial Officer

(2) Receipt of Telephonic or Facsimile
Notices
Chief Financial Officer
(915) 774-4793

(3) Authorized Officers:

A-4
<PAGE> 78
SCHEDULE B

DEFINED TERMS

As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:

"ACCEPTANCE" shall have the meaning specified in SECTION 3.6.

"ACCEPTANCE DAY" shall have the meaning specified in SECTION 3.6.

"ACCEPTANCE WINDOW" shall have the meaning specified in SECTION 3.6.

"ACCEPTED NOTE" shall have the meaning specified in SECTION 3.6.

"AFFILIATE" means, at any time, and with respect to any Person, (a)
any other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of such
first Person or any Subsidiary of such first Person or any corporation,
partnership, limited liability company or other business entity of which such
first Person and its Subsidiaries beneficially own or hold, in the aggregate,
directly or indirectly, 10% or more of any class of voting or equity interests.
As used in this definition, "CONTROL" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, as a general partner of such Person or otherwise. Unless the context
otherwise clearly requires, any reference to an "AFFILIATE" is a reference to
an Affiliate of Ultimate Parent.

"AGREED PUT CONSIDERATION" shall mean, as of the date of purchase
pursuant to SECTION 9.6 of the Notes held by the holder of any Note upon the
exercise by such holder of its Right to Put, the sum of (i) the outstanding
aggregate principal amount of the Notes held by such holder on such date, plus
(ii) all accrued and unpaid interest to such date on such Notes, plus (iii) the
Make-Whole Amount as of such date with respect to each such Note.

"ASSET SALE" means any conveyance, transfer, lease or other
disposition (including, without limitation, by means of a Sale-Leaseback
Transaction or by way of merger or consolidation) (collectively, for purposes
of this definition, a "TRANSFER"), directly or indirectly, in one or a series
of related transactions, of (a) any Capital Stock of any Subsidiary; (b) all or
substantially all of the properties of any division or line of business of
Ultimate Parent or any Subsidiary; or (c) any other properties (other than (i)
transfers of cash or cash equivalents, (ii) any sale of inventory in the
ordinary course of business, (iii) any transfer of properties that is made in
compliance with the provisions of SECTIONS 11.6(A) and 11.6(C), (iv) any
transfer of properties of

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<PAGE> 79
any Subsidiary other than the Company to Ultimate Parent or any other Wholly-
Owned Subsidiary, (v) any transfer of Licenses permitted pursuant to SECTION
11.8, (vi) sales of damaged, worn-out or obsolete equipment that, in Ultimate
Parent's reasonable judgment, are either no longer used or no longer useful in
the business of Ultimate Parent or its Subsidiaries, or (vii) any transfer of
the Hong Kong Office Space).

"AUTHORIZED OFFICER" shall mean (i) in the case of the Company, the
chief executive officer, the chief financial officer and any vice president of
General Partner designated as an "AUTHORIZED OFFICER" of the Company for the
purpose of this Agreement in an Officer's Certificate executed by the chief
executive officer or chief financial officer of General Partner and delivered
to Prudential, and (ii) in the case of Prudential, any officer of Prudential
designated as its "AUTHORIZED OFFICER" in SCHEDULE A or any officer of
Prudential designated as its "AUTHORIZED OFFICER" for the purpose of this
Agreement in a certificate executed by one of its Authorized Officers. Any
action taken under this Agreement on behalf of the Company by any individual
who on or after the date of this Agreement shall have been an Authorized
Officer of the Company and whom Prudential in good faith believes to be an
Authorized Officer of the Company at the time of such action shall be binding
on the Company even though such individual shall have ceased to be an
Authorized Officer of the Company, and any action taken under this Agreement on
behalf of Prudential by any individual who on or after the date of this
Agreement shall have been an Authorized Officer of Prudential and whom the
Company in good faith believes to be an Authorized Officer of Prudential at the
time of such action shall be binding on Prudential even though such individual
shall have ceased to be an Authorized Officer of Prudential.

"AVAILABLE FACILITY AMOUNT" shall have the meaning specified in
SECTION 3.1.

"BARBADOS GUARANTY" shall have the meaning specified in the recitals
to this Agreement.

"BUSINESS DAY" means (a) for the purposes of SECTION 9.10 only, any
day other than a Saturday, a Sunday or a day on which commercial banks in New
York City are required or authorized to be closed, (b) for the purposes of
SECTION 3.3 only, any day other than a Saturday, a Sunday, a day on which
commercial banks in El Paso, Texas or New York, New York are required or
authorized to be closed, or a day on which Prudential is not open for business,
and (c) for the purposes of any other provision of this Agreement, any day
other than a Saturday, a Sunday or a day on which commercial banks in El Paso,
Texas or New York, New York are required or authorized to be closed.

"CANCELLATION DATE" shall have the meaning specified in SECTION 3.9.3.

"CANCELLATION FEE" shall have the meaning specified in SECTION 3.9.3.

B-2
<PAGE> 80
"CAPITAL LEASE" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and
the incurrence of a liability in accordance with GAAP.

"CAPITAL STOCK" of any Person means any and all shares, interests,
participations or other equivalents in the equity interest (however designated)
in such Person and any rights (other than debt securities convertible into an
equity interest), warrants or options to acquire an equity interest in such
Person.

"CHANGE IN CONTROL" means the direct or indirect acquisition by any
person (as such term is used in Section 13(d) and Section 14(d)(2) of the
Exchange Act) or related persons constituting a group (as such term is used in
Rule 13d-5 under the Exchange Act), of beneficial ownership of issued and
outstanding shares of Voting Stock of the Company, General Partner or Ultimate
Parent, the result of which acquisition is that such person or such group
possesses in excess of 50% of the combined voting power of all then issued and
outstanding Voting Stock of the Company, General Partner or Ultimate Parent, as
the case may be, provided, that in determining whether such direct or indirect
beneficial ownership or power has been acquired by any person or any group, all
members of, or Affiliates of any of, the Current Control Group, shall be deemed
not to be persons or members of such acquiring group.

As used in this definition, "CURRENT CONTROL GROUP" means (i) (a) Gerald J.
Rubin, (b) Aaron M. Shenkman, and (c) Sam L. Henry, (ii) the spouse, children
and lineal descendants of Gerald J. Rubin or (iii) the estate of, or any trust
for the benefit of, any of Gerald J. Rubin or the persons described in clause
(ii).

"CLOSING DAY" for any Accepted Note shall mean the Business Day
specified for the closing of the purchase and sale of such Note in the Request
for Purchase of such Note, provided that (i) if the Acceptance Day for such
Accepted Note is less than five Business Days after the Company shall have made
such Request for Purchase and the Company and the Purchaser which is obligated
to purchase such Note agree on an earlier Business Day for such closing, the
"CLOSING DAY" for such Accepted Note shall be such earlier Business Day, and
(ii) if the closing of the purchase and sale of such Accepted Note is
rescheduled pursuant to SECTION 3.8, the Closing Day for such Accepted Note,
for all purposes of this Agreement except SECTION 3.9.3, shall mean the
Rescheduled Closing Day with respect to such Closing.

"CODE" means the Internal Revenue Code of 1986, as amended from time
to time, and the rules and regulations promulgated thereunder from time to
time.

"COMPANY" means Helen of Troy L.P., a Texas limited partnership.

"CONFIDENTIAL INFORMATION" is defined in SECTION 22.

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<PAGE> 81
"CONFIRMATION OF ACCEPTANCE" shall have the meaning specified in
SECTION 3.6.

"CONSOLIDATED INDEBTEDNESS" means all Indebtedness of Ultimate Parent
and its Subsidiaries, all as determined on a consolidated basis in accordance
with GAAP.

"CONSOLIDATED NET EARNINGS" means for any period, net earnings (or
loss) after income taxes of Ultimate Parent and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP, but not
including in such net earnings (or loss) the following:

(a) any extraordinary gain or loss arising from the sale of capital
assets;

(b) any extraordinary gain or loss arising from any write-up or
write-down of assets;

(c) net earnings of any Person in which Ultimate Parent or any
Subsidiary shall have an ownership interest other than a Subsidiary unless
such net earnings (or any portion thereof) shall have actually been
received by Ultimate Parent or such Subsidiary in the form of cash
distributions;

(d) earnings or losses of any Subsidiary accrued prior to the date it
became a Subsidiary;

(e) any portion of the net earnings of any Subsidiary that by reason
of any contract or charter restriction or applicable law or regulation (or
in the good faith judgment of the Board of Directors of Ultimate Parent
for any reason) is unavailable for payment of dividends or similar
distributions to Ultimate Parent or any of its Subsidiaries;

(f) the earnings or losses of any Person acquired by Ultimate Parent
or any Subsidiary through purchase, merger, consolidation or otherwise, or
the earnings or losses of any Person substantially all of whose assets
have been acquired by Ultimate Parent or any of its Subsidiaries, for any
period prior to the date of such acquisition;

(g) any gain arising from the acquisition of any Securities of
Ultimate Parent or any of its Subsidiaries; and

(h) any other extraordinary gains or losses or any other gain or loss
arising from an event or transaction that is unusual in nature and
infrequent in occurrence (but which otherwise does not constitute an
extraordinary item under GAAP) and which GAAP requires to be reported as a
separate component of revenues and expenses from continuing operations.

The above determination of net earnings (or loss) shall be made without
giving effect to any allocation thereof to any minority interest in respect of
Ultimate Parent or any of its Subsidiaries.

B-4
<PAGE> 82
"CONSOLIDATED NET WORTH" means, at any time, shareholders' equity of
Ultimate Parent as set forth in its consolidated balance sheet, determined in
accordance with GAAP.

"CONSOLIDATED TOTAL ASSETS" means the total assets of Ultimate Parent
and its Subsidiaries, determined on a consolidated basis in accordance with
GAAP.

"CONSOLIDATED TOTAL CAPITALIZATION" means, at any time, Consolidated
Net Worth plus Consolidated Indebtedness.

"DEFAULT" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.

"DEFAULT RATE" means, with respect to a particular Series of Notes,
that rate of interest per annum that is equal to the lesser of (i) the greater
of (a) 2% per annum above the rate of interest stated in clause (a) of the
first paragraph of the Notes of such Series or (b) 2% over the rate of interest
publicly announced by The Bank of New York in New York, New York as its "BASE"
or "PRIME" rate or (ii) the maximum rate permitted by applicable law.

"DELAYED DELIVERY FEE" shall have the meaning specified in SECTION
3.9.2.

"EBITDA" means for any period, subject to the final sentence of
SECTION 11.1(B), the sum of (a) Consolidated Net Earnings for such period and
(b) the amount of all consolidated interest charges, depreciation, amortization
and taxes, but only to the extent deducted in the determination of Consolidated
Net Earnings for such period.

"ENVIRONMENTAL LAWS" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.

"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.

"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.

"EVENT OF DEFAULT" is defined in SECTION 12.

"EXCESS PROCEEDS" is defined in SECTION 11.3.

B-5
<PAGE> 83
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.

"FACILITY" shall have the meaning specified in SECTION 3.1.

"FACILITY FEE" shall have the meaning specified in SECTION 3.9.1.

"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States of America.

"GENERAL PARTNER" shall have the meaning specified in the introductory
paragraph of this Agreement.

"GOVERNMENTAL AUTHORITY" means

(a) the government of

(i) the United States of America or any State or
other political subdivision thereof, or

(ii) Bermuda, any political subdivision thereof or
any other jurisdiction in which Ultimate Parent or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of Ultimate Parent or any Subsidiary,
or

(iii) Barbados, any political subdivision thereof or
any other jurisdiction in which Ultimate Parent or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of Ultimate Parent or any Subsidiary,
or

(b) any entity exercising executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, any such
government.

"GUARANTORS" means Ultimate Parent, HOT-Barbados, HOT-Texas, General
Partner and Limited Partner; "GUARANTOR" shall mean any one of the
aforementioned entities.

"GUARANTY" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments
for deposit or collection) of such Person guaranteeing or in effect
guaranteeing any indebtedness, dividend or other obligation of any other Person
in any manner, whether directly or indirectly, including (without limitation)
obligations incurred through an agreement, contingent or otherwise, by such
Person:

(a) to purchase such indebtedness or obligation or any property
constituting security therefor;

B-6
<PAGE> 84
(b) to advance or supply funds (i) for the purchase or payment of
such indebtedness or obligation, or (ii) to maintain any working capital
or other balance sheet condition or any income statement condition of any
other Person or otherwise to advance or make available funds for the
purchase or payment of such indebtedness or obligation;

(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness or
obligation of the ability of any other Person to make payment of the
indebtedness or obligation;

(d) as a general partner of a partnership, or

(e) otherwise to assure the owner of such indebtedness or obligation
against loss in respect thereof.

In any computation of the indebtedness or other liabilities of the obligor
under any Guaranty, the indebtedness or other obligations that are the subject
of such Guaranty shall be assumed to be direct obligations of such obligor.

"HAZARDOUS MATERIAL" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety,
the removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).

"HEDGE TREASURY NOTE(S)" shall mean, with respect to any Accepted
Note, the United States Treasury Note or Notes whose duration (as determined by
Prudential) most closely matches the duration of such Accepted Note.

"HELEN OF TROY ENTITIES" means Ultimate Parent, HOT-Barbados, HOT-
Texas, General Partner, Limited Partner and the Company.

"HOLDER" means, with respect to any Note, the Person in whose name
such Note is registered in the register maintained by the Company pursuant to
SECTION 15.1.

"HONG KONG OFFICE SPACE" means a specific property consisting of
approximately 12,000 square feet of office space located at 408 Silvercord
Tower II, 30 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong, owned by Helen of
Troy (Far East) Limited through condominium ownership or any other property
that would be deemed to constitute a Replacement Asset (assuming the transfer
of the Hong Kong Office Space were considered an Asset Sale).

B-7
<PAGE> 85
"HOSTILE TENDER OFFER" shall mean, with respect to the use of proceeds
of any Note, any offer to purchase, or any purchase of, shares of capital stock
of any corporation or equity interests in any other entity, or securities
convertible into or representing the beneficial ownership of, or rights to
acquire, any such shares or equity interests, if such shares, equity interests,
securities or rights are of a class which is publicly traded on any securities
exchange or in any over-the-counter market, other than purchases of such
shares, equity interests, securities or rights representing less than 5% of the
equity interests or beneficial ownership of such corporation or other entity
for portfolio investment purposes, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company
makes the Request for Purchase of such Note.

"HOT-BARBADOS" shall have the meaning specified in the introductory
paragraph of this Agreement.

"HOT-TEXAS" shall have the meaning specified in the introductory
paragraph of this Agreement.

"INDEBTEDNESS" with respect to any Person means, at any time, without
duplication,

(a) its liabilities for borrowed money and its redemption obligations
in respect of mandatorily redeemable Preferred Stock;

(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable arising in the
ordinary course of business but including all liabilities created or
arising under any conditional sale or other title retention agreement with
respect to any such property);

(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has
assumed or otherwise become liable for such liabilities);

(e) all its liabilities in respect of letters of credit or
instruments serving a similar function issued or accepted for its account
by banks and other financial institutions (whether or not representing
obligations for borrowed money);

(f) Swaps of such Person; and

(g) any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof.

B-8
<PAGE> 86
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (g) to the extent such Person
remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP.

"INITIAL CLOSING" shall have the meaning specified in SECTION 2.2.

"INITIAL DATE OF CLOSING" shall have the meaning specified in SECTION
2.2.

"INSTITUTIONAL INVESTOR" means (a) any original purchaser of a Note,
(b) any holder of a Note holding more than 10% of the aggregate principal
amount of the Notes then outstanding, and (c) any bank, trust company, savings
and loan association or other financial institution, any pension plan, any
investment company, any insurance company, any broker or dealer, or any other
similar financial institution or entity, regardless of legal form.

"INVESTMENTS" has the meaning ascribed to it in the definition of
"RESTRICTED INVESTMENT."

"ISSUANCE PERIOD" shall have the meaning specified in SECTION 3.2.

"LICENSES" means, collectively, the Revlon Licenses and the Vidal
Sassoon Agreements, or any rights thereunder.

"LIEN" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).

"LIMITED PARTNER" shall have the meaning specified in the introductory
paragraph of this Agreement.

"MAKE-WHOLE AMOUNT" is defined in SECTION 9.10.
"MATERIAL" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of Ultimate
Parent and its Subsidiaries taken as a whole.

"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of
Ultimate Parent and its Subsidiaries taken as a whole, or (b) the ability of
the Company or any Guarantor to perform its respective obligations under this
Agreement and the Notes, or (c) the validity or enforceability of this
Agreement or the Notes.

B-9
<PAGE> 87
"MULTIEMPLOYER PLAN" means any Plan that is a "MULTIEMPLOYER PLAN" (as
such term is defined in section 4001(a)(3) of ERISA).

"NET CASH PROCEEDS" means, with respect to any Asset Sale, the
proceeds thereof in the form of cash or cash equivalents, including payments in
respect of deferred payment obligations when received in the form of cash or
cash equivalents (except to the extent that such obligations are financed or
sold with recourse to Ultimate Parent or any Subsidiary), net of (i) brokerage
commissions and other reasonable and necessary fees and expenses (including,
without limitation, fees and expenses of legal counsel and investment bankers)
related to said Asset Sale, and (ii) amounts required to be paid and that have
been paid in respect of, or amounts required to be pledged and that are
pledged to secure, Indebtedness owed to any Person (other than Ultimate Parent
or any Subsidiary) owning a beneficial interest in the properties subject to
the Asset Sale.

"NOTEHOLDERS' SHARE" is defined in SECTION 9.4.

"NOTES" means all outstanding Series 1996-A Notes and Shelf Notes.

"NOTICE OF SALE" is defined in SECTION 9.6.

"OFFICER'S CERTIFICATE" means (i) a certificate of a Senior Financial
Officer or of any other officer of Ultimate Parent, the Company or any other
Subsidiary, as applicable, whose responsibilities extend to the subject matter
of such certificate, and (ii) as required with respect to the Facility, a
certificate signed in the name of the Company by an Authorized Officer of the
Company.

"ORIGINAL NOTE AGREEMENT" shall have the meaning specified in the
recitals to this Agreement.

"ORIGINAL NOTES" shall have the meaning specified in the recitals to
this Agreement.

"PARI PASSU INDEBTEDNESS" means any Indebtedness of the Company that
is pari passu in right of payment to the Notes.

"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.

"PERSON" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.

B-10
<PAGE> 88
"PERMITTED CREDIT FACILITY INDEBTEDNESS" means unsecured Indebtedness
of the Company under a revolving credit, line of credit or similar facility and
outstanding in an aggregate principal amount of not more than $10,000,000 at
any time.

"PLAN" means an "EMPLOYEE BENEFIT PLAN" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by Ultimate Parent or any ERISA
Affiliate or with respect to which Ultimate Parent or any ERISA Affiliate may
have any liability.

"PREFERRED STOCK" means (i) any class of capital stock of a
corporation that is preferred over any other class of capital stock of such
corporation as to the payment of dividends or the payment of any amount upon
liquidation or dissolution of such corporation, and (ii) any class of equity
interest of a partnership or other business entity that is preferred over any
other class of equity interest of such partnership or other business entity as
to the payment of distributions or the payment of any amount upon liquidation
or dissolution of such partnership or other business entity.

"PROCESS AGENT" is defined in SECTION 23.10(B).

"PROPERTY" or "PROPERTIES" means, unless otherwise specifically
limited, any interest in real, personal or mixed property or assets of any
kind, tangible or intangible, choate or inchoate.

"PRUDENTIAL" shall have the meaning specified in the introductory
paragraph to this Agreement.

"PRUDENTIAL AFFILIATE" shall mean any corporation or other entity all
of the Voting Stock (or equivalent voting securities or interests) of which is
owned by Prudential either directly or through Prudential Affiliates.

"PURCHASER" shall mean, with respect to any Accepted Notes the Person,
either Prudential or a Prudential Affiliate, who is purchasing such Accepted
Notes, and, with respect to any Series 1996-A Notes, the holder(s) of such
Notes.

"QPAM EXEMPTION" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.

"REPLACEMENT ASSETS" is defined in SECTION 11.3.

"REQUEST FOR PURCHASE" shall have the meaning specified in SECTION
3.4.

B-11
<PAGE> 89
"REQUIRED HOLDERS" means, at any time, the holders of at least 50.1%
in principal amount of the Notes at the time outstanding (exclusive of Notes
then owned by Ultimate Parent or any of its Affiliates).

"RESCHEDULED CLOSING DAY" shall have the meaning specified in SECTION
3.8.2.

"RESPONSIBLE OFFICER" means any Senior Financial Officer and any other
officer of Ultimate Parent, the Company or any other Subsidiary, as applicable,
with responsibility for the administration of the relevant portion of this
Agreement.

"RESTRICTED INVESTMENT" shall mean (a) all investments made in cash or
by delivery of property by Ultimate Parent and its Subsidiaries, in any Person,
whether by acquisition of stock, Indebtedness or other obligation or security,
or by loan, advance, capital contribution, or otherwise, and (b) all Guarantees
by Ultimate Parent and its Subsidiaries of the obligations of any Person (the
foregoing items being herein "INVESTMENTS"), except the following:

(i) Investments in one or more Subsidiaries or any Person which
concurrently with such Investment becomes a Subsidiary;

(ii) Investments in direct obligations of the United States of America
or any agency thereof or obligations guaranteed by the United States of
America or any agency thereof, in any case maturing within three years
after the acquisition thereof;

(iii) Investments in bankers' acceptances, certificates of deposits or
time deposits issued or accepted by any commercial bank organized under
the laws of the United States of America, any state thereof, or the
District of Columbia, and having combined capital, surplus and undivided
profits of at least $1,000,000,000, and having (or having parent holding
company that has) outstanding short-term debt rated P-1 by Moody's
Investors Service, Inc. or A-1 by Standard & Poor's Rating Group and long-
term debt rated at least A by Moody's Investors Service, Inc. or Standard
& Poor's Rating Group;

(iv) Investments in commercial paper rated in one of the two highest
rating categories by Moody's Investors Service, Inc. or by Standard &
Poor's Rating Group and maturing not more than 270 days from the date of
creation thereof; and

(v) Investments in money market mutual funds that are classified as
current assets in accordance with generally accepted accounting principles
and that invest solely in Investments described in clauses (ii), (iii) and
(iv) and of this definition maturing not more than one year after the
acquisition thereof, which funds are managed by Persons having, or who are
members of holding companies having, capital and surplus in excess of
$100,000,000.

B-12
<PAGE> 90
"REVLON LICENSES" means (i) the North American Appliance License
Agreement by and between the Company and Revlon Consumer Products Corporation
dated September 30, 1992, as amended on March 18, 1993 and on December 30,
1993, and (ii) the North American Comb and Brush License Agreement by and
between the Company and Revlon Consumer Products Corporation dated September
30, 1992, as amended on March 18, 1993 and on December 30, 1993, as any of the
same may be transferred to HOT-Barbados pursuant to SECTION 11.8.

"RIGHT TO PUT" is defined in SECTION 9.6.

"SALE-LEASEBACK TRANSACTION" means, with respect to any Person, any
direct or indirect arrangement pursuant to which properties are sold or
transferred by such Person or a Subsidiary of such Person and are thereafter
leased back from the purchaser or transferee thereof by such Person or one of
its Subsidiaries.

"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time.

"SENIOR FINANCIAL OFFICER" means the chief financial officer,
principal accounting officer, treasurer or comptroller of Ultimate Parent,
General Partner or any other Subsidiary.

"SERIES" shall have the meaning specified in SECTION 1.2.

"SERIES 1996-A NOTES" shall have the meaning specified in SECTION 1.1.

"SHELF NOTES" shall have the meaning specified in Section 1.2.

"SUBSIDIARY" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries
or such Person and one or more of its Subsidiaries owns sufficient equity or
Voting Stock to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person
or one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of
its Subsidiaries). Unless the context otherwise clearly requires, any
reference to a "SUBSIDIARY" is a reference to a Subsidiary of Ultimate Parent
and, in any event, includes the Company, HOT-Texas, General Partner, Limited
Partner and HOT-Barbados.

"SWAPS" means, with respect to any Person, payment obligations with
respect to interest rate swaps, currency swaps and similar obligations
obligating such Person to make payments, whether periodically or upon the
happening of a contingency. For the purposes of this Agreement, the amount of
the obligation under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of such Person,
based on the

B-13
<PAGE> 91
assumption that such Swap had terminated at the end of such fiscal quarter, and
in making such determination, if any agreement relating to such Swap provides
for the netting of amounts payable by and to such Person thereunder or if any
such agreement provides for the simultaneous payment of amounts by and to such
Person, then in each such case, the amount of such obligation shall be the net
amount so determined.

"TAXES" is defined in SECTION 10.6.

"TRIGGER AMOUNT" is defined in SECTION 11.3.

"ULTIMATE PARENT" shall have the meaning specified in the introductory
paragraph of this Agreement.

"VIDAL SASSOON AGREEMENTS" means (i) the Amended License Agreement
dated December 22, 1982 by and between the Company and Richardson-Vicks Inc.,
as amended on February 28, 1994, (ii) the Amended License Agreement (Canada)
dated December 22, 1982 by and between the Company and Richardson-Vicks Inc.,
as amended on February 28, 1994, and (iii) the Brush License Agreement dated
December 18, 1985 by and between the Company and Richardson-Vicks Inc., as
amended on February 28, 1994, as any of the same may be transferred to
HOT-Barbados pursuant to SECTION 11.8.

"VOTING STOCK" shall mean securities or other equity interests of any
class or classes, the holders of which are ordinarily, in the absence of
contingencies, entitled to elect a majority of the corporate directors (or
persons performing similar functions in the case of business entities other
than corporations).

"WHOLLY-OWNED SUBSIDIARY" means, at any time, any Subsidiary one
hundred percent (100%) of all of the equity interests (except directors'
qualifying shares) and Voting Stock of which is owned by any one or more of
Ultimate Parent and Ultimate Parent's other Wholly-Owned Subsidiaries at such
time.

B-14
<PAGE> 92
EXHIBIT 1-A

[FORM OF SERIES 1996-A NOTE]

HELEN OF TROY L.P.

7.01% GUARANTEED SENIOR NOTE, SERIES 1996-A, DUE JANUARY 5, 2008

No. R-_____ [Date]
$[_______] PPN 423088 A@ 2

FOR VALUE RECEIVED, the undersigned, HELEN OF TROY L.P. (herein called
the "COMPANY"), a limited partnership organized and existing under the laws of
the State of Texas, hereby promises to pay to [______________________], or
registered assigns, the principal sum of [_______________________________]
DOLLARS on January 5, 2008, with interest (computed on the basis of a 360-day
year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of
7.01% per annum, from the date hereof, payable quarterly, on the fifth day of
January, April, July and October in each year, commencing with the January 5,
April 5, July 5 or October 5 next succeeding the date hereof, until the
principal hereof shall have become due and payable, and (b) to the extent
permitted by law on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of interest and any overdue payment of any Make-
Whole Amount (as defined in the Amended and Restated Note Purchase, Guaranty
and Master Shelf Agreement referred to below), payable quarterly as aforesaid
(or, at the option of the registered holder hereof, on demand), at a rate per
annum from time to time equal to the lesser of (i) the greater of (x) 9.01% or
(y) 2% over the rate of interest publicly announced by The Bank of New York
from time to time in New York, New York as its "BASE" or "PRIME" rate, or (ii)
the maximum rate permitted by applicable law.

Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the office of The Bank of New York in New York, New York or at such
other place as the Company shall have designated by written notice to the
holder of this Note as provided in the Amended and Restated Note Purchase,
Guaranty and Master Shelf Agreement referred to below.

This Note is one of a series of Guaranteed Senior Notes (herein,
together with the Guaranteed Senior Notes of all other series, called the
"NOTES") issued pursuant to an Amended and Restated Note Purchase, Guaranty and
Master Shelf Agreement, dated as of December 31, 1996 (as from time to time
amended, the "NOTE AGREEMENT"), among the Company, Helen of Troy Limited, a
Bermuda company, Helen of Troy Limited, a Barbados company, Helen of Troy Texas
Corporation, a Texas corporation, Helen of Troy Nevada Corporation, a Nevada
corporation, HOT Nevada Inc., a Nevada corporation, and The Prudential
Insurance Company of America and is

1-A-1
<PAGE> 93
entitled to the benefits thereof. Each holder of this Note will be deemed, by
its acceptance hereof, to have agreed to the confidentiality provisions set
forth in SECTION 22 of the Note Agreement.

This Note is a registered Note and, as provided in the Note Agreement,
upon surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the
registered holder hereof or such holder's attorney duly authorized in writing,
a new Series 1996-A Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the Person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.

This Note and the holder hereof are entitled, equally and ratably with
the holders of all other Notes guaranteed by the Guarantors (as defined in the
Note Agreement) pursuant to SECTION 14 of the Note Agreement to all benefits
provided for thereby or referred to therein, to which Section reference is
hereby made for a statement of such benefits.

The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Agreement. This Note is also subject
to optional prepayment, in whole or from time to time in part, at the times and
on the terms specified in the Note Agreement, but not otherwise.

If an Event of Default, as defined in the Note Agreement, occurs and
is continuing, the principal of this Note may be declared or otherwise become
due and payable in the manner, at the price (including any applicable Make-
Whole Amount) and with the effect provided in the Note Agreement.

The Company, the Guarantors, The Prudential Insurance Company of
America and the registered holder of this Note specifically intend and agree to
limit contractually the amount of interest payable under this Note to the
maximum amount of interest lawfully permitted to be charged under applicable
law. Therefore, none of the terms of this Note shall ever be construed to
create a contract to pay interest at a rate in excess of the maximum rate
permitted to be charged under applicable law, and neither the Company nor any
other party liable or to become liable hereunder shall ever be liable for
interest in excess of the amount determined at such maximum rate, and the
provisions of SECTION 23.11 of the Note Agreement shall control over any
contrary provision of this Note.

1-A-2
<PAGE> 94
THIS NOTE IS INTENDED TO BE PERFORMED IN THE STATE OF NEW YORK AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF SUCH STATE.

HELEN OF TROY L.P.,
a Texas limited partnership

By: HELEN OF TROY NEVADA
CORPORATION, a Nevada
corporation, its general partner

By
-----------------------------------
[Vice] President

1-A-3
<PAGE> 95
EXHIBIT 1-B

[FORM OF SHELF NOTE]

HELEN OF TROY L.P.

________% GUARANTEED SENIOR NOTE, SERIES _______, DUE _____________

No. R-___ [Date]
$[_______] PPN [____________]

ORIGINAL PRINCIPAL AMOUNT:
ORIGINAL ISSUE DATE:
INTEREST RATE:
INTEREST PAYMENT DATES:
FINAL MATURITY DATE:
PRINCIPAL INSTALLMENT DATES AND AMOUNTS:

FOR VALUE RECEIVED, the undersigned, HELEN OF TROY L.P. (herein
called the "COMPANY"), a limited partnership organized and existing under the
laws of the State of Texas, hereby promises to pay to ____________________, or
registered assigns, the principal sum of ______________________________________
DOLLARS [ON THE FINAL MATURITY DATE SPECIFIED ABOVE] [, PAYABLE IN INSTALLMENTS
ON THE PRINCIPAL INSTALLMENT DATES AND IN THE AMOUNTS SPECIFIED ABOVE, AND ON
THE FINAL MATURITY DATE SPECIFIED ABOVE IN AN AMOUNT EQUAL TO THE UNPAID
BALANCE OF THE PRINCIPAL HEREOF,] with interest (computed on the basis of a
360-day year of twelve 30-day months) (a) on the unpaid balance thereof from
the date hereof at the Interest Rate per annum specified above, payable on each
Interest Payment Date specified above and on the Final Maturity Date specified
above, commencing with the Interest Payment Date next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b)
to the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest, and any overdue
payment of any Make-Whole Amount (as defined in the Amended and Restated Note
Purchase, Guaranty and Master Shelf Agreement referred to below), payable on
each Interest Payment Date as aforesaid (or, at the option of the registered
holder hereof, on demand), at a rate per annum from time to time equal to the
lesser of (i) the greater of ___%(1) or (ii) 2% over the rate of interest
publicly announced by The Bank of New York from time to time in New York, New
York as its "BASE" or "PRIME" rate, or (ii) the maximum rate permitted by
applicable law.

- ---------------
(1) Interest rate plus 2%.

1-B-1
<PAGE> 96
Payments of principal of, interest on and any Make-Whole Amount
with respect to this Note are to be made in lawful money of the United States
of America at the office of The Bank of New York in New York, New York or at
such other place as the Company shall have designated by written notice to the
holder of this Note as provided in the Amended and Restated Note Purchase,
Guaranty and Master Shelf Agreement referred to below.

This Note is one of a series of Guaranteed Senior Notes (herein,
together with the Guaranteed Senior Notes of all other series, called the
"NOTES") issued pursuant to an Amended and Restated Note Purchase, Guaranty and
Master Shelf Agreement, dated as of December 31, 1996 (herein called the "NOTE
AGREEMENT"), among the Company, Helen of Troy Limited, a Bermuda company, Helen
of Troy Limited, a Barbados company, Helen of Troy Texas Corporation, a Texas
corporation, Helen of Troy Nevada Corporation, a Nevada corporation, HOT
Nevada, Inc., a Nevada corporation, and The Prudential Insurance Company of
America and is entitled to the benefits thereof. Each holder of this Note will
be deemed, by its acceptance hereof, to have agreed to the confidentiality
provisions set forth in SECTION 22 of the Note Agreement.

This Note is a registered Note and, as provided in the Note
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Series [___] Note for a like principal amount will be issued to,
and registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the Person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company shall not be affected by any notice to
the contrary.

This Note and the holder hereof are entitled, equally and
ratably with the holders of all other Notes guaranteed by the Guarantors (as
defined in the Note Agreement) pursuant to SECTION 14 of the Note Agreement to
all benefits provided for thereby or referred to therein, to which Section
reference is hereby made for a statement of such benefits.

[THE COMPANY AGREES TO MAKE REQUIRED PREPAYMENTS OF PRINCIPAL ON
THE DATES AND IN THE AMOUNTS SPECIFIED IN THE NOTE AGREEMENT.] [THIS NOTE IS
[ALSO] SUBJECT TO OPTIONAL PREPAYMENT, IN WHOLE OR FROM TIME TO TIME IN PART,
ON THE TERMS SPECIFIED IN THE NOTE AGREEMENT.]

In case an Event of Default, as defined in the Note Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including
applicable Make-Whole Amount) and with the effect provided in the Note
Agreement.

The Company, the Guarantors, The Prudential Insurance
Company of America and the registered holder of this Note specifically intend
and agree to limit contractually the amount

1-B-2
<PAGE> 97
of interest payable under this Note to the maximum amount of interest lawfully
permitted to be charged under applicable law. Therefore, none of the terms of
this Note shall ever be construed to create a contract to pay interest at a
rate in excess of the maximum rate permitted to be charged under applicable
law, and neither the Company nor any other party liable or to become liable
hereunder shall ever be liable for interest in excess of the amount determined
at such maximum rate, and the provisions of SECTION 23.11 of the Note Agreement
shall control over any contrary provision of this Note.

THIS NOTE IS INTENDED TO BE PERFORMED IN THE STATE OF NEW YORK AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF SUCH STATE.

HELEN OF TROY L.P.,
a Texas limited partnership

By: HELEN OF TROY NEVADA
CORPORATION, a Nevada
corporation, its general partner

By
------------------------------------------------
[Vice] President

1-B-3
<PAGE> 98
EXHIBIT 2

[FORM OF REQUEST FOR PURCHASE]

HELEN OF TROY L.P.

Reference is made to the Amended and Restated Note
Purchase, Guaranty and Master Shelf Agreement (the "AGREEMENT"), dated as of
December 31, 1996 among Helen of Troy L.P. (the "COMPANY"), the other Helen of
Troy Entities (as defined therein) and The Prudential Insurance Company of
America. All terms used herein that are defined in the Agreement have the
respective meanings specified in the Agreement.

Pursuant to SECTION 3.4 of the Agreement, the Company
hereby makes the following Request for Purchase:

1. Aggregate principal amount of
the Notes covered hereby
(the "NOTES") ................... $__________

2. Individual specifications of the Notes:

<TABLE>
<CAPTION>
Principal
Final Installment Interest
Principal Maturity Dates and Payment
Amount Date Amounts Period(1)
- --------------------------------------------------------------
<S> <C> <C> <C>

</TABLE>
3. Use of proceeds of the Notes:

4. Proposed day for the closing of the purchase and sale of the
Notes:

- ---------------

(1) Specify quarterly or semi-annual.

1
<PAGE> 99
5. The purchase price of the Notes is to be transferred to:

<TABLE>
<CAPTION>
Name and
Name and Address Number of Telephone No.
of Bank Account of Bank Officer
--------------------- ----------- ---------------
<S> <C> <C>

</TABLE>

6. The Company certifies (a) that the representations and
warranties contained in SECTION 6 of the Agreement are true on
and as of the date of this Request for Purchase except to the
extent of changes caused by the transactions contemplated in
the Agreement and (b) that there exists on the date of this
Request for Purchase no Event of Default or Default.

Dated:

HELEN OF TROY L.P., a
Texas limited partnership

By: HELEN OF TROY NEVADA
CORPORATION, a Nevada
corporation, its general partner

By
--------------------------------------------
Authorized Officer

2
<PAGE> 100
EXHIBIT 3

[FORM OF CONFIRMATION OF ACCEPTANCE]

HELEN OF TROY L.P.

Reference is made to the Amended and Restated Note Purchase,
Guaranty and Master Shelf Agreement (the "AGREEMENT"), dated as of December 31,
1996 among Helen of Troy L.P. (the "COMPANY"), the other Helen of Troy Entities
(as defined therein) and The Prudential Insurance Company of America. All
terms used herein that are defined in the Agreement have the respective
meanings specified in the Agreement.

Each of the undersigned institutions which is named below as a
Purchaser of any Accepted Notes hereby confirms the representations as to such
Accepted Notes set forth in SECTION 7 of the Agreement, and agrees to be bound
by the provisions of SECTIONS 3.6 and 3.8 of the Agreement relating to the
purchase and sale of such Accepted Notes.

Pursuant to SECTION 3.6 of the Agreement, an Acceptance with
respect to the following Accepted Notes is hereby confirmed:

I. Aggregate principal amount $____________

(A) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal installment dates and amounts:
(e) Interest rate:
(f) Interest payment period:

(B) (a) Name of Purchaser:
(b) Principal amount:
(c) Final maturity date:
(d) Principal installment dates and amounts:
(e) Interest rate:
(f) Interest payment period:

[(C),(D) ....: SAME INFORMATION AS TO ANY OTHER PURCHASER]
<PAGE> 101
II. Closing Day:

III. Facility Fee:

Dated:

HELEN OF TROY L.P., a
Texas limited partnership

By: HELEN OF TROY NEVADA
CORPORATION, a Nevada
corporation, its general partner

By
-----------------------------------
Title:

THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA

By
------------------------------------------
Vice President

[SIGNATURE BLOCK FOR EACH NAMED PURCHASER
OTHER THAN PRUDENTIAL]

2
<PAGE> 102
EXHIBIT 4.4(A)

FORM OF OPINION OF UNITED STATES COUNSEL
TO THE HELEN OF TROY ENTITIES

[SAME AS JANUARY 1996 OPINION EXCEPT FOR
CHANGES IN NAMES OF DOCUMENTS, ADDITION OF
OTHER HELEN OF TROY ENTITIES AND MATTERS OF
NEVADA CORPORATE LAW]

1
<PAGE> 103
EXHIBIT 4.4(B)

FORM OF OPINION OF BERMUDA COUNSEL
TO ULTIMATE PARENT

[SAME AS JANUARY 1996 OPINION EXCEPT FOR
CHANGES IN NAMES OF DOCUMENTS.]

1
<PAGE> 104
EXHIBIT 4.4(C)

FORM OF OPINION OF BARBADOS COUNSEL
TO HOT-BARBADOS

[SAME AS JANUARY 1996 OPINION EXCEPT FOR
CHANGES IN NAMES OF DOCUMENTS.]

1
<PAGE> 105
EXHIBIT 9.6

FORM OF NOTICE OF SALE

[LETTERHEAD OF NOTE HOLDER]

Helen of Troy L.P.
c/o Helen of Troy Nevada Corporation
6827 Market Avenue
El Paso, Texas 79915
Attn: Chief Financial Officer

Gentlemen:

Reference is made to the Amended and Restated Note Purchase,
Guaranty and Master Shelf Agreement, dated as of December 31, 1996 (the "NOTE
AGREEMENT"; the capitalized terms herein being used herein as therein defined),
among Helen of Troy L.P., (the "COMPANY"), the other Helen of Troy Entities (as
defined therein) and The Prudential Insurance Company of America. In
accordance with SECTION 9.6 of the Note Agreement, the undersigned hereby
exercises its Right to Put with respect to all Notes held by it.

In the event that the Required Holder(s) give a Notice or
Notices of Sale, please transfer, in immediately available funds, on the date
specified in the Change of Control Purchase Notice to be given by you pursuant
to SECTION 9.6(B) of the Note Agreement, the Agreed Put Consideration with
respect to the foregoing exercise of the undersigned's Right to Put.

Date:

[NAME OF HOLDER OF NOTES]

By:
-------------------------------------------
Name:
Title:

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED, CONDENSED FINANCIAL STATEMENTS OF HELEN OF TROY LIMITED AND
SUBSIDIARIES AS OF, AND FOR THE 3-MONTH PERIOD ENDED NOVEMBER 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>

<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> FEB-28-1997
<PERIOD-END> NOV-30-1996
<CASH> 14,506,000
<SECURITIES> 0
<RECEIVABLES> 65,701,000
<ALLOWANCES> 1,470,000
<INVENTORY> 62,765,000
<CURRENT-ASSETS> 144,100,000
<PP&E> 27,876,000
<DEPRECIATION> 3,784,000
<TOTAL-ASSETS> 193,705,000
<CURRENT-LIABILITIES> 36,291,000
<BONDS> 40,450,000
0
0
<COMMON> 1,309,000
<OTHER-SE> 115,655,000
<TOTAL-LIABILITY-AND-EQUITY> 193,705,000
<SALES> 74,477,000
<TOTAL-REVENUES> 74,477,000
<CGS> 46,143,000
<TOTAL-COSTS> 46,143,000
<OTHER-EXPENSES> 18,278,000
<LOSS-PROVISION> 1,380,000
<INTEREST-EXPENSE> 311,000
<INCOME-PRETAX> 10,073,000
<INCOME-TAX> 2,268,000
<INCOME-CONTINUING> 7,805,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,805,000
<EPS-PRIMARY> .56
<EPS-DILUTED> .55

</TABLE>