EXHIBIT 99.2
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PAYLESS SHOESOURCE FINANCE, INC.
SECOND AMENDMENT TO
CREDIT AND GUARANTY AGREEMENT
This SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT, dated
as of July 8, 2003 (this "AMENDMENT") is entered into by and among PAYLESS
SHOESOURCE FINANCE, INC., a Nevada corporation ("COMPANY"), PAYLESS SHOESOURCE,
INC., a Delaware corporation ("PARENT"), CERTAIN FINANCIAL INSTITUTIONS listed
on the signature pages hereto, XXXXXXX XXXXX CREDIT PARTNERS L.P., as sole Lead
Arranger and as sole Syndication Agent (in such capacity, "SYNDICATION AGENT"),
BANK ONE, NA, with its main office in Chicago, Illinois, as Administrative Agent
(together with its permitted successors in such capacity, "ADMINISTRATIVE
AGENT"), WACHOVIA BANK, NATIONAL ASSOCIATION, as Documentation Agent, and the
CREDIT SUPPORT PARTIES listed on the signature pages hereto, and is made with
reference to that certain Credit and Guaranty Agreement, dated as of April 17,
2000, as amended (the "CREDIT AGREEMENT"). Capitalized terms used herein not
otherwise defined herein or otherwise amended hereby shall have the meanings
ascribed thereto in the Credit Agreement.
RECITALS:
WHEREAS, Parent and Company have requested that Requisite
Lenders agree to make amendments to certain provisions of the Credit Agreement;
and
WHEREAS, Administrative Agent and Requisite Lenders have
agreed to amend certain provisions of the Credit Agreement, in the manner, and
on the terms and conditions, provided for herein.
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto agree
as follows:
SECTION I. AMENDMENTS TO CREDIT AGREEMENT
Upon satisfaction of the conditions set forth in Section III.A. herein,
the Credit Agreement shall be amended as follows in this Section I:
A. AMENDMENTS TO SECTION 1: DEFINITIONS.
(A) Section 1.1 of the Credit Agreement is hereby amended
by adding thereto the following definitions in proper alphabetical order:
"'ASSET COVERAGE RATIO' means the ratio as at any date of
determination of (i) the product of (a) the Consolidated Inventory as
of such date multiplied by (b) 0.55 to (ii) the result of (a)
Consolidated Senior Indebtedness as of such date minus, (b) the amount,
if any, of Cash and Cash Equivalents on hand (other than Restricted
Cash) of Parent and its Subsidiaries on a consolidated basis as of such
date."
"'CONSOLIDATED INVENTORY' means, as at any date of
determination, the aggregate book value of inventory of Parent and its
Subsidiaries as reflected on Parent's financial statements as of such
date, determined on a consolidated basis in accordance with GAAP, that
is not subject to any Lien."
"'CONSOLIDATED SENIOR INDEBTEDNESS' means, as at any date of
determination, Consolidated Total Debt other than Subordinated
Indebtedness incurred pursuant to Section 6.1(c) and any Indebtedness
under any New Debt Securities which are subordinated in right of
payment to the Obligations, determined on a consolidated basis in
accordance with GAAP."
"'FISCAL MONTH' means a fiscal month of any Fiscal Year."
"'NEW DEBT SECURITIES' means any unsecured debt Securities
issued by Parent, in an aggregate principal amount not to exceed
$300,000,000, pursuant to and in accordance with Section 6.1(q)."
"'RESTRICTED CASH' means, as at any date of determination, the
amount of Cash and Cash Equivalents of Parent and its Subsidiaries
determined on a consolidated basis on such date that is (i) restricted
in withdrawal or use by Parent or any such Subsidiary or (ii) subject
to any Lien."
(B) Section 1.1 of the Credit Agreement is hereby amended by
deleting the definitions of "'Applicable Margin' and 'Applicable Commitment Fee
Percentage'," "Consolidated Total Debt," "Letter of Credit Sublimit," "Net Debt
Issuance Proceeds," "Revolving Credit Commitment" and "Revolving Credit
Commitments" in their entirety and substituting therefore the following:
"'APPLICABLE MARGIN' means (i) with respect to Term Loans and
Revolving Loans that are Eurodollar Rate Loans, 2.25% per annum and
(ii) with respect to Swing Line Loans, and Term Loans and Revolving
Loans that are Base Rate Loans, 1.25% per annum."
"'APPLICABLE COMMITMENT FEE PERCENTAGE' means 0.50% per
annum."
"'CONSOLIDATED TOTAL DEBT' means, as at any date of
determination, the aggregate stated balance sheet amount of all
Indebtedness (other than any Indebtedness under Back-to-Back Loans
outstanding pursuant to and in accordance with Sections 6.1(n) and
6.1(o)) of Parent and its Subsidiaries determined on a consolidated
basis in accordance with GAAP."
"'LETTER OF CREDIT SUBLIMIT' means the lesser of (i)
$150,000,000 and (ii) the aggregate unused amount of the Revolving
Credit Commitments then in effect."
"'NET DEBT ISSUANCE PROCEEDS' means, an amount equal to (i)
any Cash proceeds received by Parent or any of its Subsidiaries from
the incurrence of any Indebtedness by Parent or any of its Subsidiaries
or the issuance of preferred stock Securities by Parent
minus (ii) all underwriting discounts and commissions and other
reasonable and customary costs and expenses associated with the
issuance or incurrence of such Indebtedness or issuance of preferred
stock Securities, including reasonable legal fees and expenses. For
purposes of this definition Indebtedness shall not include any
Indebtedness permitted to be incurred pursuant to Section 6.1 (other
than Indebtedness incurred pursuant to Section 6.1(q))."
"'REVOLVING CREDIT COMMITMENT' means the commitment of a
Lender to make or otherwise fund any Credit Extension (other than any
Term Loan). The amount of each Lender's Revolving Credit Commitment, if
any, is set forth on Appendix B or in the applicable Assignment
Agreement, subject to any adjustment or reduction pursuant to the terms
and conditions hereof; 'REVOLVING CREDIT COMMITMENTS' means the
Revolving Credit Commitments of all Lenders in the aggregate. The
aggregate amount of the Revolving Credit Commitments is $150,000,000."
B. AMENDMENTS TO SECTION 2: LOANS AND LETTERS OF CREDIT.
(A) Section 2.14(c) of the Credit Agreement is hereby amended by
deleting Section 2.14(c) in its entirety and replacing it with the following:
"(c) Issuance of Debt. If as of any date, Parent or
any of its Subsidiaries shall have (i) received Aggregate Net Debt
Issuance Proceeds in excess of $25,000,000 in any Fiscal Year (other
than any Net Debt Issuance Proceeds received from any Indebtedness
permitted to be incurred pursuant to Section 6.1(q)), Company shall, no
later than the third Business Day following the date of receipt of such
proceeds exceeding such amount, prepay the Term Loans as set forth in
Section 2.15(b) in an aggregate amount equal to 100% of such excess
and/or (ii) received Net Debt Issuance Proceeds pursuant to the
incurrence of Indebtedness permitted under Section 6.1(q), Company
shall no later than the third Business Day following the date of
receipt of such proceeds, prepay the Term Loans as set forth in Section
2.15(b) in an aggregate amount equal to 100% of such Net Debt Issuance
Proceeds. Notwithstanding anything to the contrary, Section 2.14(c)(i)
shall not be applicable after the date on which Parent has received an
Investment Grade Status rating."
C. AMENDMENTS TO SECTION 3: CONDITIONS PRECEDENT.
(A) Section 3.2(iv) of the Credit Agreement is hereby amended by
deleting the word "and" at the end of clause (iv) thereof.
(B) Section 3.2(v) of the Credit Agreement is hereby amended by
deleting "." at the conclusion thereof and replacing it with "; and" at the
conclusion thereof.
(C) Section 3.2 of the Credit Agreement is hereby amended by
adding the following clause (vi) at the conclusion thereof as follows:
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"(vi) as of such Credit Date, the ratio of (i) the product of (a)
Consolidated Inventory as of the last day of the most recently
completed Fiscal Month ending at least 25 days prior to such Credit
Date multiplied by (b) 0.55 to (ii) the result of (a) Consolidated
Senior Indebtedness as of such Credit Date after giving effect to the
Credit Extensions made on such Credit Date minus, (b) the amount, if
any, of Cash and Cash Equivalents on hand (other than Restricted Cash)
of Parent and its Subsidiaries on a consolidated basis as of the last
day of the most recently completed Fiscal Month ending at least 25 days
prior to such Credit Date, shall not be less than 1.00:1.00."
D. AMENDMENTS TO SECTION 5: AFFIRMATIVE COVENANTS.
(A) Section 5.1(c) of the Credit Agreement is hereby amended by
deleting Section 5.1(c) in its entirety and replacing it with the following:
"(c) Compliance Certificate. (i) Together with each
delivery of financial statements of Parent and its Subsidiaries
pursuant to Sections 5.1(a) and 5.1(b), a duly executed and completed
Compliance Certificate which shall also set forth in reasonable detail,
calculations demonstrating compliance with the Asset Coverage Ratio
covenant set forth in Section 6.6(f); and (ii) as soon as available,
and in any event within 45 days after the end of the Fiscal Year ending
January 31, 2004, a certificate of the chief financial officer of
Company and Parent setting forth reasonably detailed calculations
demonstrating compliance with the Fixed Charge Coverage Ratio covenant
set forth in Section 6.6(a) for the then most recently completed Fiscal
Quarter;"
E. AMENDMENTS TO SECTION 6: NEGATIVE COVENANTS.
(A) Section 6.1(o) of the Credit Agreement is hereby
amended by deleting the word "and" at the end of clause (o) thereof.
(B) Section 6.1(p) of the Credit Agreement is hereby amended by
deleting "." at the conclusion thereof and replacing it with "; and" at the
conclusion thereof.
(C) Section 6.1 of the Credit Agreement is hereby amended by
adding the following clause (q) to the conclusion thereof as follows:
"(q) unsecured Indebtedness of Parent and its Subsidiaries
under any New Debt Securities; provided, that (i) the aggregate
principal amount of Indebtedness with respect to any New Debt
Securities incurred pursuant to this Section 6.1(q) shall not exceed
$300,000,000, (ii) such Indebtedness shall have a maturity date no
earlier than one year after April 17, 2005, (iii) such Indebtedness
shall not provide for any scheduled payment or mandatory prepayment of
principal earlier than one year after April 17, 2005, (iv) the interest
rate and other terms of such Indebtedness shall be reasonably
acceptable to Administrative Agent and Syndication Agent, and (v)
immediately prior to and after giving effect to the incurrence of such
Indebtedness, no Default or Event of Default shall have occurred and be
continuing, provided further, that, until the payment in full of all
amounts owed hereunder with respect to the Term Loans, the Net Debt
Issuance Proceeds
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of such Indebtedness shall be applied to repay the Term Loans
outstanding hereunder in accordance with Section 2.15(b) of this
Agreement."
(D) Section 6.6(a) of the Credit Agreement is hereby amended by
deleting Section 6.6(a) in its entirety and replacing it with the following:
"(a) Minimum Fixed Charge Coverage Ratio. Parent
shall not permit the Fixed Charge Coverage Ratio as of the last day of
any Fiscal Quarter (which last day occurs in any period set forth
below), beginning with the Fiscal Quarter ending April 29, 2000, to be
less than the correlative ratio indicated:
----------------------------- ----------------------
FISCAL QUARTER FIXED CHARGE
COVERAGE RATIO
----------------------------- ----------------------
----------------------------- ----------------------
April 29, 2000 - 1.75:1.00
November 3, 2001
----------------------------- ----------------------
November 4, 2001 - 1.55:1.00
February 2, 2002
----------------------------- ----------------------
February 3, 2002 - 1.50:1.00
May 4, 2002
----------------------------- ----------------------
May 5, 2002 - 1.55:1.00
August 3, 2002
----------------------------- ----------------------
August 4, 2002 - 1.65:1.00
November 2, 2002
----------------------------- ----------------------
November 3, 2002 - 1.75:1.00
February 1, 2003
----------------------------- ----------------------
February 2, 2003 - 1.75:1.00
May 3, 2003
----------------------------- ----------------------
May 4, 2003 - 1.40:1.00
August 2, 2003
----------------------------- ----------------------
August 3, 2003 - 1.30:1.00
November 1, 2003
----------------------------- ----------------------
November 2, 2003 1.75:1.00
and thereafter
----------------------------- ----------------------
(E) Section 6.6(b) of the Credit Agreement is hereby amended by deleting
Section 6.6(b) in its entirety and replacing it with the following:
5
"(B) Maximum Leverage Ratio. Parent shall not permit the
Leverage Ratio as of the last day of any Fiscal Quarter (which last day
occurs in any period set forth below), beginning with the Fiscal
Quarter ending April 29, 2000, to exceed the correlative ratio
indicated:
----------------------------- ----------------------
FISCAL QUARTER LEVERAGE RATIO
----------------------------- ----------------------
----------------------------- ----------------------
April 29, 2000 - 2.00:1.00
May 3, 2003
----------------------------- ----------------------
May 4, 2003 - 2.50:1.00
November 1, 2003
----------------------------- ----------------------
November 2, 2003 2.00:1.00
and thereafter
----------------------------- ----------------------
(F) Section 6.6 of the Credit Agreement is hereby amended by adding the
following clause (f) at the conclusion thereof as follows:
"(f) Asset Coverage Ratio. Parent shall not permit the Asset
Coverage Ratio as of the last day of any Fiscal Quarter, beginning with
the Fiscal Quarter ending August 2, 2003, to be less than the ratio of
1.00:1.00.
F. AMENDMENT TO SECTION 10: MISCELLANEOUS.
(A) Section 10.17 of the Credit Agreement is hereby amended by
adding the following at the conclusion thereof:
"Notwithstanding anything to the contrary set forth herein, each party
(and each of their respective employees, representatives or other
agents) may disclose to any and all persons, without limitations of any
kind, the tax treatment and tax structure of the transactions
contemplated by this Agreement and all materials of any kind (including
opinions and other tax analyses) that are provided to any such party
relating to such tax treatment and tax structure. However, any
information relating to the tax treatment or tax structure shall remain
subject to the confidentiality provisions hereof (and the foregoing
sentence shall not apply) to the extent reasonably necessary to enable
the parties hereto, their respective Affiliates, and their and their
respective Affiliates' directors and employees to comply with
applicable securities laws. For this purpose, "tax structure" means any
facts relevant to the federal income tax treatment of the transactions
contemplated by this Agreement but does not include information
relating to the identity of any of the parties hereto or any of their
respective affiliates."
G. AMENDMENTS TO APPENDIX B: REVOLVING CREDIT COMMITMENTS.
(A) Appendix B to the Credit Agreement is hereby replaced by
Appendix B attached hereto.
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H. AMENDMENT TO EXHIBIT C: COMPLIANCE CERTIFICATE.
(A) Item 13 of Annex A to the Compliance Certificate is hereby
amended by deleting the reference to "Required: 1.75:1.00" therein and inserting
"Required: [_.__]:1.00" therefor.
(B) Item 14 of Annex A to the Compliance Certificate is hereby
amended by deleting the reference to "Required: 2.00:1.00" therein and inserting
"Required: [_.__]:1.00" therefor.
SECTION II. CONTINGENT TERM LOAN PAYDOWN AMENDMENTS TO CREDIT AGREEMENT
Upon satisfaction of the conditions set forth in Section III.B. herein,
the Credit Agreement shall be amended as follows in this Section II:
A. AMENDMENTS TO SECTION 1: DEFINITIONS.
(A) Section 1.1 of the Credit Agreement is hereby amended by
deleting the definitions of "Applicable Margin," "Applicable Commitment Fee
Percentage" and "Fixed Charge Coverage Ratio" in their entirety and substituting
therefore the following:
"'APPLICABLE MARGIN' and 'APPLICABLE COMMITMENT FEE PERCENTAGE'
means (i) with respect to Revolving Loans that are Eurodollar Rate
Loans and the Applicable Commitment Fee Percentage, a percentage, per
annum, determined by reference to the Leverage Ratio then in effect
from time to time as set forth below:
----------------------- ----------------------------- --------------------------
LEVERAGE APPLICABLE MARGIN APPLICABLE
RATIO FOR REVOLVING LOANS COMMITMENT FEE PERCENTAGE
----------------------- ----------------------------- --------------------------
----------------------- ----------------------------- --------------------------
> 2.25:1.00 2.50% 0.50%
-
----------------------- ----------------------------- --------------------------
< 2.25:1.00 2.25% 0.50%
> 1.75:1.00
-
----------------------- ----------------------------- --------------------------
< 1.75:1.00 2.00% 0.40%
> 1.25:1.00
-
----------------------- ----------------------------- --------------------------
< 1.25:1.00 1.75% 0.35%
> 0.75:1.00
-
----------------------- ----------------------------- --------------------------
< 0.75:1.00 1.50% 0.25%
----------------------- ----------------------------- --------------------------
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and (ii) with respect to Swing Line Loans, and Revolving Loans that are
Base Rate Loans, a percentage per annum equal to (a) the Applicable
Margin for Eurodollar Rate Loans as set forth in clause (i) above, as
applicable, minus (b) 1.00% per annum. No change in the Applicable
Margin or the Applicable Commitment Fee Percentage shall be effective
until three (3) Business Days after the date on which Administrative
Agent shall have received the applicable financial statements and a
Compliance Certificate pursuant to Section 5.1(c) calculating the
Leverage Ratio. At any time Company has not submitted to Administrative
Agent the applicable information as and when required under Section
5.1(c), the Applicable Margin and the Applicable Commitment Fee
Percentage shall be determined as if the Leverage Ratio were in excess
of 2.25:1.00. Within one (1) Business Day of receipt of the applicable
information as and when required under Section 5.1(c), Administrative
Agent shall give each Lender telefacsimile or telephonic notice
(confirmed in writing) of the Applicable Margin and the Applicable
Commitment Fee Percentage in effect from such date."
"'FIXED CHARGE COVERAGE RATIO' means the ratio as of the last
day of any Fiscal Quarter of (i) Consolidated Adjusted EBITDAR for the
four-Fiscal Quarter Period then ending, to (ii) Consolidated Fixed
Charges for such four-Fiscal Quarter Period."
B. AMENDMENTS TO SECTION 3: CONDITIONS PRECEDENT.
(A) Section 3.2(vi) of the Credit Agreement is hereby amended by
deleting Section 3.2(vi) in its entirety and replacing it with the following:
"(vi) as of such Credit Date, the ratio of (i) the product of
(a) Consolidated Inventory as of the last day of the most recently
completed Fiscal Month ending at least 25 days prior to such Credit
Date multiplied by (b) in the case of any Credit Date occurring (y)
during the first Fiscal Quarter of any Fiscal Year other than on the
last day of any such first Fiscal Quarter in any Fiscal Year, 0.65, and
(z) at any other time, 0.55 to (ii) the result of (a) Consolidated
Senior Indebtedness as of such Credit Date after giving effect to the
Credit Extensions made on such Credit Date minus, (b) the amount, if
any, of Cash and Cash Equivalents on hand (other than Restricted Cash)
of Parent and its Subsidiaries on a consolidated basis as of the last
day of the most recently completed Fiscal Month ending at least 25 days
prior to such Credit Date, shall not be less than 1.00:1.00."
C. AMENDMENTS TO SECTION 6: NEGATIVE COVENANTS.
(A) Section 6.4(a)(v) of the Credit Agreement is hereby amended
by deleting the word "and" at the end of clause 6.4(a)(v) thereof.
(B) Section 6.4(a)(vi) of the Credit Agreement is hereby amended
by deleting "." at the conclusion thereof and replacing it with "; and " at the
conclusion thereof.
(C) Section 6.4(a) of the Credit Agreement is hereby amended by
adding the following clause (vii) to the conclusion thereof as follows:
8
"(vii) After the prior payment in full of all amounts owed
hereunder with respect to the Term Loans, Parent shall be permitted to
repurchase its shares of Parent Common Stock with the Net Debt Issuance
Proceeds received from the issuance of Indebtedness incurred pursuant
to Section 6.1(q); provided, that immediately prior to and after giving
effect to such repurchase no Default or Event of Default shall have
occurred and be continuing; provided further, that such repurchases
shall not in the aggregate exceed $50,000,000."
(D) Section 6.5(j) of the Credit Agreement is hereby amended by
deleting Section 6.5(j) in its entirety and replacing it with the following:
"(j) other Investments, provided that the aggregate amount of
such Investments, together with the aggregate amount of all Investments
made in accordance with Section 6.5(l), in each case made after the
Closing Date through the date of determination, shall not exceed at any
time in any Fiscal Year the corresponding amount set forth below
opposite such Fiscal Year:
----------------------------- ----------------------
FISCAL YEAR INVESTMENT AMOUNT
----------------------------- ----------------------
----------------------------- ----------------------
Fiscal Year ending $75,000,000
February 3, 2001
----------------------------- ----------------------
Fiscal Year ending $40,000,000
February 2, 2002
----------------------------- ----------------------
Fiscal Year ending $70,000,000
February 1, 2003
----------------------------- ----------------------
Fiscal Year ending $100,000,000
January 31, 2004
----------------------------- ----------------------
Fiscal Year ending $135,000,000
January 29, 2005
----------------------------- ----------------------
Thereafter $150,000,000
----------------------------- ----------------------
(E) Section 6.6(a) of the Credit Agreement is hereby amended by
deleting Section 6.6(a) in its entirety and replacing it with the following:
"(a) Minimum Fixed Charge Coverage Ratio. Parent
shall not permit the Fixed Charge Coverage Ratio as of the last day of
any Fiscal Quarter (which last day occurs in any period set forth
below), beginning with the Fiscal Quarter ending April 29, 2000, to be
less than the correlative ratio indicated:
9
----------------------------- ----------------------
FISCAL QUARTER FIXED CHARGE
COVERAGE RATIO
----------------------------- ----------------------
----------------------------- ----------------------
April 29, 2000 - 1.75:1.00
November 3, 2001
----------------------------- ----------------------
November 4, 2001 - 1.55:1.00
February 2, 2002
----------------------------- ----------------------
February 3, 2002 - 1.50:1.00
May 4, 2002
----------------------------- ----------------------
May 5, 2002 - 1.55:1.00
August 3, 2002
----------------------------- ----------------------
August 4, 2002 - 1.65:1.00
November 2, 2002
----------------------------- ----------------------
November 3, 2002 - 1.75:1.00
May 3, 2003
----------------------------- ----------------------
May 4, 2003 - 1.40:1.00
August 2, 2003
----------------------------- ----------------------
August 3, 2003 - 1.30:1.00
May 1, 2004
----------------------------- ----------------------
May 2, 2004 1.40:1.00
and thereafter
----------------------------- ----------------------
(F) Section 6.6(b) of the Credit Agreement is hereby amended by
deleting Section 6.6(b) in its entirety and replacing it with the following:
"(b) Maximum Leverage Ratio. Parent shall not permit the
Leverage Ratio as of the last day of any Fiscal Quarter (which last day
occurs in any period set forth below), beginning with the Fiscal
Quarter ending April 29, 2000, to exceed the correlative ratio
indicated:
----------------------------- ----------------------
FISCAL QUARTER LEVERAGE RATIO
----------------------------- ----------------------
----------------------------- ----------------------
April 29, 2000 - 2.00:1.00
August 2, 2003
----------------------------- ----------------------
August 3, 2003 2.75:1.00
and thereafter
----------------------------- ----------------------
10
SECTION III. CONDITIONS PRECEDENT TO EFFECTIVENESS
A. The effectiveness of the amendments set forth in Section I hereof are
subject to the satisfaction, or waiver by Requisite Lenders, of the following
conditions on or before the date hereof (the "SECOND AMENDMENT CLOSING DATE"):
(A) Company, Parent, other Credit Parties and Requisite Lenders
shall have indicated their consent by the execution and delivery of the
signature pages hereof to Administrative Agent.
(B) Administrative Agent shall have received a certificate from
an officer of Company and Parent stating that as of the Second Amendment Closing
Date, the representations and warranties contained in Section IV herein and in
the other Credit Documents are true, correct and complete in all respects on and
as of the Second Amendment Closing Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties are true, correct and complete in all respects on and as of such
earlier date.
(C) Administrative Agent shall have received a certificate from
an officer of Company and Parent stating that as of the Second Amendment Closing
Date, no event has occurred and is continuing that would constitute an Event of
Default or a Default.
(D) Administrative Agent shall have received, for distribution
to all Lenders executing this Amendment, an amendment fee equal to 0.125% of
such Lender's Term Loans and Revolving Credit Commitment (after giving effect to
the reduction of the Revolving Credit Commitments as set forth herein) as of the
date hereof.
(E) Company shall have paid all fees and other amounts due and
payable on or prior to the Second Amendment Closing Date, including, to the
extent invoiced, reimbursement or other payment of all out-of-pocket expenses
required to be reimbursed or paid by the Company hereunder or under any other
Credit Document.
(F) Administrative Agent shall have received, for each Lender,
originally executed copies of one or more favorable written opinions of (i)
Wachtell Lipton Xxxxx & Xxxx, special counsel for Company, Parent and each
Subsidiary Guarantor, (ii) Xxxxxxx Xxxxxx, Esq., in-house counsel for Company,
Parent and each Subsidiary Guarantor and (iii) Kummer, Kempf, Xxxxxx & Xxxxxxx,
special Nevada counsel for Company, each dated the Second Amendment Closing
Date, in form and substance reasonably satisfactory to Administrative Agent and
Syndication Agent.
(G) Administrative Agent and Lenders shall have received such
other documents and information regarding Credit Parties and the Credit
Agreement as Administrative Agent or Lenders may reasonably request.
11
B. The effectiveness of the amendments set forth in Section II hereof
are subject to the satisfaction, or waiver by Requisite Lenders, of the
following conditions (the "CONTINGENT TERM LOAN PAYDOWN AMENDMENT CLOSING
DATE"):
(A) The conditions to effectiveness of the amendments set forth
in Section I hereof shall have been satisfied or waived by the Requisite Lenders
on or before the Contingent Term Loan Paydown Amendment Closing Date.
(B) The entire outstanding principal amount of the Term Loans,
and all amounts owed under the Credit Agreement with respect thereto, shall have
been repaid in full.
(C) Administrative Agent shall have received a certificate from
an officer of Company and Parent stating that as of the Contingent Term Loan
Paydown Amendment Closing Date, the representations and warranties contained in
Section IV herein and in the other Credit Documents are true, correct and
complete in all respects on and as of the Contingent Term Loan Paydown Amendment
Closing Date to the same extent as though made on and as of that date, except to
the extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties are true, correct and
complete in all respects on and as of such earlier date.
(D) Administrative Agent shall have received a certificate from
an officer of Company and Parent stating that as of the Contingent Term Loan
Paydown Amendment Closing Date, no event has occurred and is continuing that
would constitute an Event of Default or a Default.
(E) Company shall have paid all fees and other amounts due and
payable on or prior to the Contingent Term Loan Paydown Amendment Closing Date,
including, to the extent invoiced, reimbursement or other payment of all out-of-
pocket expenses required to be reimbursed or paid by Company hereunder or under
any other Credit Document.
(F) Administrative Agent and Lenders shall have received such
other documents and information regarding Credit Parties and the Credit
Agreement as Administrative Agent or Lenders may reasonably request.
SECTION IV. REPRESENTATIONS AND WARRANTIES
A. CORPORATE POWER AND AUTHORITY. Each Credit Party has all requisite
corporate power and authority to enter into this Amendment and to carry out the
transactions contemplated by, and perform its obligations under the Credit
Agreement and the other Credit Documents.
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this
Amendment and the performance of the Credit Agreement and the other Credit
Documents have been duly authorized by all necessary corporate or partnership
(as applicable) action on the part of each Credit Party.
C. NO CONFLICT. The execution and delivery by each Credit Party of this
Amendment and the performance by each Credit Party of the Credit Agreement and
the other Credit
12
Documents do not (i) violate (A) any provision of any law, statute, rule or
regulation, or of the certificate or articles of incorporation or partnership
agreement, other constitutive documents or by-laws of each Credit Party or any
of its Subsidiaries except to the extent such violation could not reasonably be
expected to have a Material Adverse Effect, (B) any applicable order of any
court or any rule, regulation or order of any Governmental Authority except to
the extent such violation could not reasonably be expected to have a Material
Adverse Effect or (C) any provision of any indenture, certificate of designation
for preferred stock, agreement or other instrument to which each Credit Party or
any of its Subsidiaries is a party or by which any of them or any of their
property is or may be bound except to the extent such violation could not
reasonably be expected to have a Material Adverse Effect, (ii) be in conflict
with, result in a breach of or constitute (alone or with notice or lapse of time
or both) a default under any such indenture, certificate of designation for
preferred stock, agreement or other instrument, where any such conflict,
violation, breach or default referred to in this clause (ii) of this Section
IV.C., individually or in the aggregate could reasonably be expected to have a
Material Adverse Effect, (iii) result in or require the creation or imposition
of any Lien upon any of the properties or assets of each Credit Party (other
than any Liens created under any of the Credit Documents in favor of
Administrative Agent on behalf of Lenders), or (iv) require any approval of
stockholders or partners or any approval or consent of any Person under any
contractual obligation of each Credit Party, except for such approvals or
consents which will be obtained on or before the Second Amendment Closing Date
or Contingent Term Loan Paydown Amendment Closing Date, as applicable.
D. GOVERNMENTAL CONSENTS. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
required in connection with the execution and delivery by each Credit Party of
this Amendment and the performance by each Credit Party of the Credit Agreement
and the other Credit Documents, except for such actions, consents and approvals
the failure to obtain or make which could not reasonably be expected to result
in a Material Adverse Effect or which have been obtained and are in full force
and effect.
E. BINDING OBLIGATION. This Amendment and the Credit Agreement have been
duly executed and delivered by each Credit Party and each constitutes a legal,
valid and binding obligation of each Credit Party enforceable against each
Credit Party in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, moratorium, reorganization or other similar
laws affecting creditors' rights generally and except as enforceability may be
limited by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
F. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
DOCUMENTS. The representations and warranties contained in the Credit Documents
are and will be true, correct and complete in all material respects on and as of
the Second Amendment Closing Date or the Contingent Term Loan Paydown Amendment
Closing Date, as applicable, to the same extent as though made on and as of that
date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.
13
G. ABSENCE OF DEFAULT. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this Amendment
that would constitute an Event of Default or a Default.
SECTION V. ACKNOWLEDGMENT AND CONSENT
Each of Parent and each wholly-owned Domestic Subsidiary of
Parent (other than Company) has (i) guaranteed the Obligations and (ii) created
Liens in favor of Lenders on certain Collateral (as defined in the Collateral
Documents) to secure its obligations under the Credit Agreement and the
Collateral Documents subject to the terms and provisions of the Credit
Agreement. Each of Parent and each wholly-owned Domestic Subsidiary of Parent
who has guaranteed the Obligations are collectively referred to herein as the
"CREDIT SUPPORT PARTIES", and the Credit Agreement and the Collateral Documents
are collectively referred to herein as the "CREDIT SUPPORT DOCUMENTS".
Each Credit Support Party hereby acknowledges that it has
reviewed the terms and provisions of the Credit Agreement and this Amendment and
consents to the amendment of the Credit Agreement effected pursuant to this
Amendment. Each Credit Support Party hereby confirms that each Credit Support
Document to which it is a party or otherwise bound and all Collateral encumbered
thereby will continue to guarantee or secure, as the case may be, to the fullest
extent possible in accordance with the Credit Support Documents the payment and
performance of all "Obligations" under each of the Credit Support Documents, as
the case may be (in each case as such terms are defined in the applicable Credit
Support Document), including without limitation the payment and performance of
all such "Obligations" under each of the Credit Support Documents, as the case
may be, in respect of the Obligations of Company now or hereafter existing under
or in respect of the Credit Agreement and hereby pledges and assigns to
Collateral Agent, and grants to Collateral Agent a continuing lien on and
security interest in and to all Collateral as collateral security for the prompt
payment and performance in full when due of the "Obligations" under each of the
Credit Support Documents to which it is a party (whether at stated maturity, by
acceleration or otherwise).
Each Credit Support Party acknowledges and agrees that any of
the Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Credit Support Party
represents and warrants that all representations and warranties contained in the
Credit Agreement, this Amendment and the Credit Support Documents to which it is
a party or otherwise bound are true, correct and complete in all material
respects on and as of the Second Amendment Closing Date or the Contingent Term
Loan Paydown Amendment Closing Date, as applicable, to the same extent as though
made on and as of that date, except to the extent such representations and
warranties specifically relate to an earlier date, in which case they were true,
correct and complete in all material respects on and as of such earlier date.
Each Credit Support Party acknowledges and agrees that (i)
notwithstanding the conditions to effectiveness set forth in this Amendment,
such Credit Support Party is not required by the terms of the Credit Agreement
or any other Credit Document to consent to the amendments to the Credit
Agreement effected pursuant to this Amendment and (ii) nothing in
14
the Credit Agreement, this Amendment or any other Credit Document shall be
deemed to require the consent of such Credit Support Party to any future
amendments to the Credit Agreement.
SECTION VI. MISCELLANEOUS
A. BINDING EFFECT. This Amendment shall be binding upon the parties
hereto and their respective successors and assigns and shall inure to the
benefit of the parties hereto and the successors and assigns of Lenders. No
Credit Party's rights or obligations hereunder or any interest therein may be
assigned or delegated by any Credit Party without the prior written consent of
all Lenders.
B. SEVERABILITY. In case any provision in or obligation hereunder shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
C. REFERENCE TO CREDIT AGREEMENT. On and after the Second Amendment
Closing Date or the Contingent Term Loan Paydown Amendment Closing Date, as
applicable, each reference in the Credit Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import referring to the Credit
Agreement, and each reference in the other Credit Documents to the "Credit
Agreement", "thereunder", "thereof" or words of like import referring to the
Credit Agreement shall mean and be a reference to the Credit Agreement as
amended by this Amendment.
D. EFFECT ON CREDIT AGREEMENT. Except as specifically amended by this
Amendment, the Credit Agreement and the other Credit Documents shall remain in
full force and effect and are hereby ratified and confirmed.
E. EXECUTION. The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of any Agent
or Lender under, the Credit Agreement or any of the other Credit Documents.
F. HEADINGS. Section headings herein are included herein for convenience
of reference only and shall not constitute a part hereof for any other purpose
or be given any substantive effect.
G. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
H. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. As set forth herein, this Amendment shall become effective upon
the execution of a counterpart hereof by each of the
15
parties hereto and receipt by Administrative Agent and Syndication Agent of
written or telephonic notification of such execution and authorization of
delivery thereof.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
16
EXHIBIT 99.2
------------
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
COMPANY PAYLESS SHOESOURCE FINANCE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
CREDIT SUPPORT PARTIES PAYLESS SHOESOURCE, INC. (DE)
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President -
Chief Financial
Officer and Treasurer
DYELIGHTS INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS DELAWARE COMPANY 2, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS DELAWARE COMPANY 3, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS DELAWARE COMPANY 4, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PAYLESS SHOESOURCE, INC. (MO)
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President -
Chief Financial
Officer and Treasurer
PAYLESS SHOESOURCE GOLD VALUE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
SHOE SOURCING, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PAYLESS PURCHASING SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
EASTBOROUGH, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PAYLESS SHOESOURCE WORLDWIDE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President -
Chief Financial
Officer and Treasurer
PSS LABOR LEASING, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS INVESTMENT I, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS INVESTMENT III, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PAYLESS SHOESOURCE DISTRIBUTION, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PAYLESS SHOESOURCE MERCHANDISING, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
` ---------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
PSS CANADA, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Treasurer
ADMINISTRATIVE AGENT
AND A LENDER BANK ONE, NA
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Director
SOLE SYNDICATION AGENT,
SOLE LEAD ARRANGER,
AND A LENDER XXXXXXX SACHS CREDIT PARTNERS L.P.,
By: /s/ Xxxxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Authorized Signatory
DOCUMENTATION AGENT
AND A LENDER WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ Xxx Xxxxxx
-----------------------------
Name: Xxx Xxxxxx
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
The Bank of New York
--------------------
By: /s/ Xxxxxxx Xxxxxx
------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Fleet National Bank
------------------------------
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Managing Director
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
HSBC Bank USA
-----------------------------
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: First Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Xxxxx Fargo Bank, N.A.
---------------------------------
By: /s/ Xxxxx X. Xxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
ABN AMRO Bank N.V.
---------------------------------
By: /s/ Xxxxxxxx X. Xxxx
-------------------------------
Name: Xxxxxxxx X. Xxxx
Title: Senior Vice President
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Mizuho Corporate Bank, Ltd.
---------------------------------------
By: /s/ Xxxx Botshan
------------------------------------
Name: Xxxx Botshan
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Royal Bank of Canada
--------------------------------------
By: /s/ Xxxxxx X. Xxxxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Senior Manager
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Union Bank of California, N.A.
--------------------------------------------
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
U.S. Bank, National Association
-------------------------------------------
By: /s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Citizens Bank of Massachusetts
-------------------------------------------
By: /s/ Xxxx X. Xxxxx
----------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
IKB Capital Corporation
----------------------------
By: /s/ Xxxxxxxx Xxxxxx
--------------------------
Name: Xxxxxxxx Xxxxxx
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Banco Popular de Puerto Rico, New York Branch
---------------------------------------------
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Bank of Hawaii
--------------------------
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Xxxxx Xxx Commercial Bank, Ltd., New York Branch
--------------------------------------------------
By: /s/ Ming-Xxxxx Xxx
------------------------
Name: Ming-Xxxxx Xxx
Title: SVP & General Manager
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
The Mitsubishi Trust and Banking Corporation
-----------------------------------------------
By: /s/ Ryo Magome
------------------
Name: Ryo Magome
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
UMB Bank, n.a.
-----------------------------
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
RZB Finance, LLC
-------------------
By: /s/ Dieter Beintrexler
----------------------------
Name: Dieter Beintrexler
Title: President
By: /s/ Xxxx X. Xxxxxxx
-------------------------
Name: Xxxx X. Xxxxxxx
Title: Group Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Hibernia National Bank
-------------------------
By: /s/ Xxxxxx Xxxxxxx
----------------------
Name: Xxxxxx Xxxxxxx
Title: Relationship Manager
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Commerce Bank, N.A.
-----------------------
By: /s/ Xxxxxx X. Block
-----------------------
Name: Xxxxxx X. Block
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Banco Espirito Santo, S.A.
-------------------------------
By: /s/ Xxxxx X. Xxxx
-----------------------
Name: Xxxxx X. Xxxx
Title: Senior Vice President
By: /s/ Xxxxxx X. Xxxxx
-------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
Bank of Canton of California
(Now a Part of United Commercial Bank)
-----------------------------------------
By: /s/ Xxx X. Xxx
--------------------
Name: Xxx X. Xxx
Title: Credit Administration Manager
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
East West Bank
---------------------
By: /s/ Xxxxx X. Xxxxx
---------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President
SECOND AMENDMENT TO THE
CREDIT AND GUARANTY AGREEMENT
To approve the Second Amendment:
Name of Institution:
United World Chinese Commercial Bank
--------------------------------------
By: /s/ Xxxxx Xxxx
----------------
Name: Xxxxx Xxxx
Title: VP & Deputy General Manager
APPENDIX B
TO CREDIT AND GUARANTY AGREEMENT
Revolving Credit Commitments
------------------------------------------------ ------------------------------------------ ------------------------
Lender Revolving Credit Commitment Pro Rata Share
------------------------------------------------ ------------------------------------------ ------------------------
------------------------------------------------ ------------------------------------------ ------------------------
Wachovia Bank, National Association $12,500,000 8.33%
------------------------------------------------ ------------------------------------------ ------------------------
Bank One, NA $11,396,028 7.60%
------------------------------------------------ ------------------------------------------ ------------------------
The Bank of New York $11,250,000 7.50%
------------------------------------------------ ------------------------------------------ ------------------------
Fleet National Bank $11,250,000 7.50%
------------------------------------------------ ------------------------------------------ ------------------------
HSBC Bank USA $10,000,000 6.67%
------------------------------------------------ ------------------------------------------ ------------------------
Xxxxx Fargo Bank, N.A. $7,500,000 5.00%
------------------------------------------------ ------------------------------------------ ------------------------
ABN AMRO Bank N.V. $6,250,000 4.17%
------------------------------------------------ ------------------------------------------ ------------------------
Mizuho Corporate Bank $6,250,000 4.17%
------------------------------------------------ ------------------------------------------ ------------------------
Royal Bank of Canada $6,250,000 4.17%
------------------------------------------------ ------------------------------------------ ------------------------
Union Bank of California, N.A. $6,250,000 4.17%
------------------------------------------------ ------------------------------------------ ------------------------
US Bank, National Association $6,250,000 4.17%
------------------------------------------------ ------------------------------------------ ------------------------
Citizens Bank of Massachusetts $5,000,000 3.33%
------------------------------------------------ ------------------------------------------ ------------------------
IKB Capital Corporation $5,000,000 3.33%
------------------------------------------------ ------------------------------------------ ------------------------
Banco Popular de Puerto Rico $3,750,000 2.50%
------------------------------------------------ ------------------------------------------ ------------------------
Bank of Hawaii $3,750,000 2.50%
------------------------------------------------ ------------------------------------------ ------------------------
Xxxxx Xxx Commercial Bank, Ltd., New York $3,750,000 2.50%
Branch
------------------------------------------------ ------------------------------------------ ------------------------
Xxx Xxx Commercial Bank $3,750,000 2.50%
------------------------------------------------ ------------------------------------------ ------------------------
The Mitsubishi Trust and Banking Corporation $3,750,000 2.50%
------------------------------------------------ ------------------------------------------ ------------------------
UMB Bank, n.a. $3,750,000 2.50%
------------------------------------------------ ------------------------------------------ ------------------------
Sumitomo Mitsui Bank $3,307,692 2.21%
------------------------------------------------ ------------------------------------------ ------------------------
------------------------------------------------ ------------------------------------------ ------------------------
Xxxxxxx Sachs Credit Partners L.P. $3,125,000 2.08%
------------------------------------------------ ------------------------------------------ ------------------------
RZB Finance, LLC $2,500,000 1.67%
------------------------------------------------ ------------------------------------------ ------------------------
Hibernia National Bank $2,353,972 1.57%
------------------------------------------------ ------------------------------------------ ------------------------
Commerce Bank, N.A. $1,875,000 1.25%
------------------------------------------------ ------------------------------------------ ------------------------
Bank of East Asia $1,500,000 1.00%
------------------------------------------------ ------------------------------------------ ------------------------
International Commerce Bank $1,442,308 0.96%
------------------------------------------------ ------------------------------------------ ------------------------
Banco Espirito Santo, S.A. $1,250,000 0.83%
------------------------------------------------ ------------------------------------------ ------------------------
Bank of Canton of California (A Part of United $1,250,000 0.83%
Commercial Bank)
------------------------------------------------ ------------------------------------------ ------------------------
East West Bank $1,250,000 0.83%
------------------------------------------------ ------------------------------------------ ------------------------
Land Bank of Taiwan $1,250,000 0.83%
------------------------------------------------ ------------------------------------------ ------------------------
United World Chinese Commercial Bank $1,250,000 0.83%
------------------------------------------------ ------------------------------------------ ------------------------
TOTAL $150,000,000 100%
------------------------------------------------ ------------------------------------------ ------------------------
