Exhibit 10-14(b)
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is dated as
of June 19, 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. The definition of "Rental Expense" in Section 1.01 of the
Credit Agreement is hereby amended to read in its entirety as follows:
"Rental Expense" means, for any period, all obligations in respect of base
and contingent rent paid or due by the Borrowers or any of their
Subsidiaries during such period under any rental agreements or leases of
real or personal property (other than capitalized leases), excluding: (a)
"License Fees", "Excess Fees" and "Miscellaneous Expense Fees" as defined
under the Kmart Agreement, and (b) other fees which (i) are similar to
those referenced in clause (a) above and (ii) may be characterized as
royalties, license fees, excess fees, advertising fees or miscellaneous
expense fees and which arise under any agreement between any Borrower or
any Borrower's Subsidiary and any retailer pursuant to which such Borrower
or Subsidiary operates a footwear department in such retailer's store.
B. Pari Passu Liens. Section 5.10 of the Credit Agreement is hereby
amended by re-lettering paragraph (k) as paragraph (l) and adding new paragraph
(k) as follows:
(k) Liens on the Collateral securing Debt permitted under Section
5.16(g); provided that such Liens shall rank pari passu with any Liens on
the Collateral securing Debt under this Agreement and the other Loan
Documents, with the Agent hereby authorized to act as collateral agent for
any Bank which provides any credit facility permitted under Section
5.16(g), pursuant to amendments to the Pledge Agreement, the Guarantee
Agreement and all applicable UCC financing statements in form and
substance reasonably satisfactory to the Agent and the Borrowers.
C. Additional Debt. Section 5.16 of the Credit Agreement is hereby amended
by deleting the word "and" at the end of paragraph (e), by adding the following
new paragraph (f), by re-lettering existing paragraph (f) as paragraph (g), and
by amending such new paragraph (g) to read in its entirety as set forth below:
(f) at any time, up to $50,000,000 in Debt reflecting the aggregate
face amount of all letters of credit issued on behalf of the Company and
its Subsidiaries and the aggregate amount of all unpaid reimbursement
obligations relating to letters of credit; and
(g) Debt of the Company and its Subsidiaries which are Borrowers or
Guarantors not otherwise permitted by the foregoing clauses of this
Section (including Guarantees), provided that
(i) no Debt covered by this Section 5.16(g) shall contain
terms, conditions, covenants or defaults more restrictive on the
Company or any of its Subsidiaries than those set forth in this
Agreement;
(ii) with respect to any Debt covered by this Section 5.16(g)
which is in excess of $25,000,000, the Agent shall have received
final, executed documents and instruments evidencing and securing
such Debt, or relating thereto, within ten (10) calendar days after
the incurrence thereof;
(iii) immediately after the incurrence of any such Debt, and
after giving effect thereto on a pro forma basis (both as of the
date of such incurrence and as of the end of and for the applicable
fiscal period most recently ended prior thereto), no Default shall
have occurred and be continuing; and
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(iv) the Company shall have provided to the Agent a
certificate, signed on behalf of the Company by its chief financial
officer or other financial officer and demonstrating, in reasonable
detail, compliance with paragraph (iii) above, as to all financial
covenants set forth in this Agreement, and certifying to the
satisfaction of the conditions set forth in this Section 5.16(g) as
of the date such Debt is incurred.
D. 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.
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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-1
attached hereto and such other matters as may be reasonably requested by the
Agent.
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 June 19, 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
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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, 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
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Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President, Finance
FOOTSTAR CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President, Finance
FLEET NATIONAL BANK, as Agent
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Director
FIRST UNION NATIONAL BANK,
as Syndication Agent
By: /s/ Xxxxxxx X. Xxxxxxx
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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: /s/ Xxxxxxx Xxxxx /s/ Xxxxx X. Xxxxxx
----------------- -------------------
Name: Xxxxxxx Xxxxx Xxxxx X. Xxxxxx
Title: Asst VP Vice President
(signatures continued on next page)
BANK OF AMERICA, N.A.,
as Managing Agent
By:_____________________________________
Name:_______________________________
Title:______________________________
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:_____________________________________
Name:_______________________________
Title:______________________________
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
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Name: Xxxx X. Land
Title: Vice President
THE CHASE MANHATTAN BANK, as Bank
By: /s/ Xxxxxx Xxxxxxx
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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:_____________________________________
Name:_______________________________
Title:______________________________
BANK OF HAWAII, as Bank
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
HIBERNIA NATIONAL BANK, as Bank
By:_____________________________________
Name:_______________________________
Title:______________________________
By:_____________________________________
Name:_______________________________
Title:______________________________
CONSENT AND CONFIRMATION OF SUBSIDIARIES
Each of the undersigned hereby joins in the execution of the foregoing
Second Amendment to Credit Agreement dated as of June 19, 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
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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: /s/ Xxxxx Xxxxxxxxxxx
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Duly Authorized Signatory as to all
