Exhibit 10-14(a)
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as of
May 10, 2001 by and among FOOTSTAR, INC. and FOOTSTAR CORPORATION (the
"Borrowers"); the financial institutions which are now, or in accordance with
Section 9.06 of the Credit Agreement (hereinafter described) hereafter become,
parties to the Credit Agreement by execution of the signature pages to the
Credit Agreement or otherwise (collectively, the "Banks" and each individually,
a "Bank"); FLEET NATIONAL BANK, as administrative agent ("Administrative Agent")
for the Banks (in such capacity as Administrative Agent, together with its
successors and assigns in such capacity, the "Agent"); FIRST UNION NATIONAL
BANK, as syndication agent (in such capacity, together with its successors and
assigns in such capacity, the "Syndication Agent"); and BANK OF NEW YORK, as
documentation agent (in such capacity, together with its successors and assigns
in such capacity, the "Documentation Agent").
RECITALS
A. The Borrowers, the Banks, the Agent, the Syndication Agent and the
Documentation Agent are parties to a Credit Agreement dated as of May 25, 2000
(as the same has been or may hereafter be amended, supplemented, extended or
otherwise modified from time to time, the "Credit Agreement"). Capitalized terms
used herein without definition have the meanings assigned to them in the Credit
Agreement.
B. The Borrowers have requested certain amendments to the Credit
Agreement.
C. Subject to certain terms and conditions, the Agent and the Banks are
willing to agree to such requests, as hereinafter set forth.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
I. AMENDMENTS TO CREDIT AGREEMENT.
The Credit Agreement is hereby amended as follows:
A. Definitions. Section 1.01 of the Credit Agreement is hereby amended as
follows:
1. The definitions of "Consolidated EBITDA", "Interest Coverage Ratio" and
"Leverage Ratio" are amended to read, each in its entirety, as follows:
"Consolidated EBITDA" means, with respect to the Company and its
Consolidated Subsidiaries for any fiscal period, the sum (without
duplication) of (a) Consolidated Adjusted Income for such period,
(b) Consolidated Net Interest Expense (whether a positive or
negative number) for such period, (c) Federal, state and local
income taxes (or other taxes in the nature of income taxes)
deducted in determining Consolidated Adjusted Income for such
period, and (d) depreciation and amortization deducted in
determining Consolidated Adjusted Income for such period; provided
that Consolidated EBITDA shall be adjusted on a pro forma basis to
give effect to all Acquisitions and Dispositions made at any time
during the applicable fiscal period, in each case as if such
Acquisition and Disposition had occurred at the beginning of such
fiscal period and calculated in a manner reasonably satisfactory to
the Agent but excluding up to ($10,000,000) in the aggregate in
negative EBITDA allocable as a result of such transactions in any
period of four consecutive fiscal quarters.
"Interest Coverage Ratio" means, for each period of four consecutive
fiscal quarters, the ratio of (a) Consolidated EBITDAR for such
period to (b) the sum, without duplication, of (i) Consolidated Net
Interest Expense for such period and (ii) Rental Expense for such
period; in each case, with respect to clauses (i) and (ii), to the
extent deducted in determining Consolidated Adjusted Income for such
period.
"Leverage Ratio" means, as of the last day of each fiscal quarter,
the ratio of (a) Consolidated Total Debt on such date to (b)
Consolidated EBITDA for the period of four consecutive fiscal
quarters ending on such date.
2. The following new definition is added:
"Disposition" has the meaning set forth in the definition of "Asset
Sale".
B. Additional Condition. Section 3.02 of the Credit Agreement is hereby
amended by deleting the word "and" at the end of paragraph (c), by deleting the
period at the end of paragraph (d) and substituting therefor the word "; and",
and by adding the following new paragraph (e):
(e) the fact that, immediately after giving effect to such Borrowing
or the issuance of such Letter of Credit and since the date of the annual
financial statements most recently delivered to the Agent, no event shall
have occurred and no circumstance shall exist that has had, or would
reasonably be expected to cause, a material adverse change to the
financial condition of the Company.
C. Acquisitions. Section 5.09(d) of the Credit Agreement is hereby amended
by deleting the character and numerals "$125,000,000" and substituting therefor
"$200,000,000".
D. Restricted Payments. Section 5.15 of the Credit Agreement is hereby
amended by deleting the words "Calculation Period" and substituting therefor the
words "period of four consecutive fiscal quarters".
E. Leverage. Section 5.17 of the Credit Agreement is hereby amended to
read in its entirety as follows:
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SECTION 5.17. Leverage Ratio. The Leverage Ratio will not exceed
2.00:1.00.
F. Interest Coverage. Section 5.18 of the Credit Agreement is hereby
amended to read in its entirety as follows:
SECTION 5.18. Interest Coverage Ratio. The Interest Coverage Ratio
will not be less than 2.00:1.00.
G. No Further Amendments. Except as specifically amended above, the text
of the Credit Agreement and of each of the other Loan Documents shall remain
unmodified and in full force and effect and is hereby ratified and affirmed in
all respects, and the Debt of any Borrower to the Agent and the Banks evidenced
thereby and by the Notes is hereby reaffirmed in all respects.
II. REFERENCES IN SECURITY DOCUMENTS; CONFIRMATION OF SECURITY.
All references to the "Credit Agreement" in the Guarantee Agreement, the
Pledge Agreement and any other Loan Documents evidencing or relating to the
Collateral (the "Security Documents"), and in any other Loan Documents shall,
from and after the date hereof, refer to the Credit Agreement, as amended by
this Amendment, and all obligations of any Borrower under the Credit Agreement,
as amended, shall be secured by and be entitled to the benefits of the Security
Documents and other Loan Documents. All Security Documents heretofore executed
by the Company and any Subsidiary thereof shall remain in full force and effect
and such Security Documents, as amended hereby, are hereby ratified and
affirmed.
III. CONDITIONS.
The effectiveness of this Amendment is subject to the following express
conditions precedent and subsequent:
A. The Company shall have executed and delivered to the Agent (or shall
have caused to be executed and delivered to the Agent by the appropriate
persons) the following:
1. This Amendment;
2. True and complete copies of any required stockholders' and/or
directors' consents and/or resolutions, authorizing the execution and
delivery of this Amendment, certified by the secretary of the Company; and
3. Such other supporting documents and certificates as the Agent or
its counsel may reasonably request.
B. The Agent and the Banks shall have received the favorable opinion of
in-house counsel to the Borrowers substantially in the form of Exhibit A annexed
hereto and such other matters as may be reasonably requested by the Agent.
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C. As soon as practicable after the date hereof, the Borrowers shall have
complied with the terms and conditions of that certain letter agreement dated as
of May 10, 2001 between the Agent and the Borrowers.
D. The Banks required pursuant to the Credit Agreement to execute and
deliver this Amendment in order to amend the Credit Agreement shall have
executed and delivered this Amendment.
E. All legal matters incident to the transactions contemplated hereby
shall be reasonably satisfactory to counsel for the Agent.
IV. REPRESENTATIONS, WARRANTIES AND COVENANTS.
As a material inducement to the Agent and the Banks to enter into this
Amendment, the Borrowers hereby jointly and severally represent and warrant to
the Agent (which representations and warranties shall survive the delivery of
this Amendment), after giving effect to this Amendment, as follows:
A. The execution and delivery of this Amendment have been duly authorized
by all requisite corporate action on the part of each Borrower, and will not
violate any provision of law, any order, judgment or decree of any court or
other agency of government, or the articles or bylaws of the Company or any
Subsidiary or any indenture, agreement or other instrument to which the Company
or any Subsidiary is bound, or be in conflict with, or result in a breach of, or
constitute (with due notice or lapse of time or both) a default under, or result
in the creation or imposition of any Lien, upon any of the property or assets of
the Company or any Subsidiary thereto pursuant to, any such indenture, agreement
or instrument, except for any violations, contraventions or defaults under such
indentures, agreements, judgments, injunctions, orders, decrees or other
instruments or the creation or imposition of any such Liens that individually or
in the aggregate would not constitute an Event of Default under Section 5.10 or
would not reasonably be expected to have a Material Adverse Effect.
B. The representations and warranties contained in the Credit Agreement
and in the other Loan Documents, and the information set forth in the Exhibits
and Schedules thereto and in the Officer's Certificates heretofore delivered
thereunder are true and correct in all material respects on and as of the date
of this Amendment as though made at and as of such date (except to the extent
that such representations and warranties expressly relate to an earlier date
(including, but not limited to, the representations and warranties in Section
4.04(d) which expressly relate to an earlier date), and except to the extent
variations therefrom have been permitted under the terms of the Credit
Agreement). No material adverse change has occurred in the assets, liabilities,
financial condition, business or prospects of the Company and its Subsidiaries
from that disclosed in the financial statements most recently furnished to the
Agent pursuant to the Credit Agreement. No Default has occurred and is
continuing.
C. This Amendment constitutes the legal, valid and binding obligation of
each Borrower, enforceable against such Borrower in accordance with its terms,
subject to bankruptcy,
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insolvency, reorganization, moratorium and similar laws affecting the rights and
remedies of creditors generally or the application of principles of equity,
whether in any action at law or proceeding in equity, and subject to the
availability of the remedy of specific performance or of any other equitable
remedy or relief to enforce any right thereunder.
V. MISCELLANEOUS.
A. As provided in the Credit Agreement, the Borrowers jointly and
severally agree to reimburse the Agent upon demand for all reasonable fees and
disbursements of counsel to the Agent incurred in connection with the
preparation of this Amendment.
B. This Amendment shall be governed by and construed in accordance with
the internal laws of the State of New York (excluding the laws applicable to
conflicts or choice of laws).
C. This Amendment may be executed by the parties hereto in several
counterparts hereof and by the different parties hereto on separate counterparts
hereof, all of which counterparts shall together constitute one and the same
agreement. Delivery of an executed signature page of this Amendment by facsimile
transmission shall be effective as an in-hand delivery of an original executed
counterpart hereof.
[The next pages are the signature pages.]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized representatives, all as of the day
and year first above written.
FOOTSTAR, INC.
By: /s/ Xxxxxx X. Xxxxxxx III
------------------------------------
Name: Xxxxxx X. Xxxxxxx III
Title: Senior Vice President, Finance
FOOTSTAR CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx III
------------------------------------
Name: Xxxxxx X. Xxxxxxx III
Title: Senior Vice President, Finance
FLEET NATIONAL BANK, as Agent
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
FIRST UNION NATIONAL BANK,
as Syndication Agent
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
BANK OF NEW YORK,
as Documentation Agent
By: /s/ Xxxxxx X. Xxxxxx, Xx.
------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President
CREDIT SUISSE FIRST BOSTON,
as Managing Agent
By:_____________________________________
Name:_______________________________
Title:______________________________
(signatures continued on next page)
BANK OF AMERICA, N.A.,
as Managing Agent
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
FLEET NATIONAL BANK, as Bank
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
FIRST UNION NATIONAL BANK, as Bank
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
BANK OF NEW YORK, as Bank
By: /s/ Xxxxxx X. Xxxxxx, Xx.
------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President
CREDIT SUISSE FIRST BOSTON, as Bank
By: /s/ Xxxxxxx Xxxxx /s/ Xxxxx X. Xxxxxx
----------------- -------------------
Name: Xxxxxxx Xxxxx Xxxxx X. Xxxxxx
Title: Asst VP Vice President
BANK OF AMERICA, N.A., as Bank
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
NATIONAL CITY BANK, as Bank
By: /s/ Xxxxxx X. XxXxxxxxx
------------------------------------
Name: Xxxxxx X. XxXxxxxxx
Title: Senior Vice President
(signatures continued on next page)
PNC BANK, NATIONAL ASSOCIATION,
as Bank
By: /s/ Xxxx X. Land
------------------------------------
Name: Xxxx X. Land
Title: Vice President
THE CHASE MANHATTAN BANK, as Bank
By: /s/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
FIRSTAR BANK, N.A., as Bank
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
------------------------------------
Title: Vice President
BANCO POPULAR DE PUERTO RICO,
as Bank
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
By:_____________________________________
Name:_______________________________
Title:______________________________
BANK OF HAWAII, as Bank
By:_____________________________________
Name:_______________________________
Title:______________________________
SUMMIT BANK, as Bank
By:_____________________________________
Name:_______________________________
Title:______________________________
(signatures continued on next page)
HIBERNIA NATIONAL BANK, as Bank
By: /s/ Xxxxx Xxxxx
------------------------------------
Name: Xxxxx Xxxxx
Title: Assistant VP
By:_____________________________________
Name:_______________________________
Title:______________________________
CONSENT AND CONFIRMATION OF SUBSIDIARIES
Each of the undersigned hereby joins in the execution of the foregoing
First Amendment to Credit Agreement dated as of May ___, 2001 (the "Amendment")
to which this Consent and Confirmation is attached (1) to confirm its consent,
to the extent required, to all of the transactions contemplated by the
Amendment, and (2) to confirm and ratify its Guaranty Agreement and its Pledge
and Security Agreement, each entered into as required under such Credit
Agreement, dated as of May 25, 2000 in favor of the Agent on behalf of the
Banks, which remains in full force and effect.
FOOTSTAR, INC.
FOOTSTAR CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx III
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Duly authorized signatory as to both
FOOTSTAR CENTER, INC.
FOOTACTION CENTER, INC.
FEET CENTER, INC.
MELDISCO H.C., INC.
APACHE-MINNESOTA XXXX XXXX, INC.
MILES SHOES MELDISCO LAKEWOOD
COLORADO, INC.
MALL OF AMERICA FAN CLUB, INC.
NEVADA FEET, INC.
FEET OF COLORADO, INC.
LFD I, INC.
LFD II, INC.
LFD OPERATING, INC.
By: Xxxxx Xxxxxxxxxxx
Duly Authorized Signatory as to all
