UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549


FORM 10-Q
(Mark One)
[X]
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
For the quarterly period ended July 31, 2010
   
[  ]
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: 1-2191

BROWN SHOE COMPANY, INC.
( Exact name of registrant as specified in its charter)
   
New York
(State or other jurisdiction
of incorporation or organization)
43-0197190
(IRS Employer Identification Number)
   
8300 Maryland Avenue
St. Louis, Missouri
(Address of principal executive offices)
63105
(Zip Code)
 
(314) 854-4000
(Registrant's telephone number, including area code)
 
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   R     No £

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
    Yes   £     No £

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:
   Large accelerated filer £  Accelerated filer R
     
    Non-accelerated filer £   Smaller reporting company £
    (Do not check if a smaller reporting company)  
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
    Yes   £     No R

As of August 28, 2010, 43,857,140 common shares were outstanding.
 
1
 
 
PART I
FINANCIAL INFORMATION


ITEM 1
FINANCIAL STATEMENTS

BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

 
(Unaudited)
     
($ thousands)
July 31, 2010
 
August 1, 2009
 
January 30, 2010
 
Assets
                 
Current assets
                 
   Cash and cash equivalents
$
30,724
 
$
37,274
 
$
125,833
 
   Receivables
 
106,149
   
72,156
   
84,297
 
   Inventories
 
578,085
   
526,808
   
456,682
 
   Prepaid expenses and other current assets
 
33,206
   
41,877
   
41,437
 
Total current assets
 
748,164
   
678,115
   
708,249
 
                   
Other assets
 
118,884
   
110,540
   
113,114
 
Intangible assets, net
 
73,876
   
80,613
   
77,226
 
Property and equipment
 
418,190
   
423,704
   
418,765
 
   Allowance for depreciation
 
(281,983
)
 
(268,154
)
 
(277,204
)
Net property and equipment
 
136,207
   
155,550
   
141,561
 
Total assets
$
1,077,131
 
$
1,024,818
 
$
1,040,150
 
                   
 
Liabilities and Equity
               
Current liabilities
                 
   Borrowings under revolving credit agreement
$
35,500
 
$
47,500
 
$
94,500
 
   Trade accounts payable
 
294,845
   
233,791
   
177,700
 
   Other accrued expenses
 
139,675
   
133,652
   
141,863
 
Total current liabilities
 
470,020
   
414,943
   
414,063
 
                   
Other liabilities
                 
   Long-term debt
 
150,000
   
150,000
   
150,000
 
   Deferred rent
 
38,011
   
42,049
   
38,869
 
   Other liabilities
 
27,555
   
29,570
   
25,991
 
Total other liabilities
 
215,566
   
221,619
   
214,860
 
                   
Equity
                 
   Common stock
 
439
   
428
   
429
 
   Additional paid-in capital
 
130,621
   
149,530
   
152,314
 
   Accumulated other comprehensive income (loss)
 
1,567
   
(4,279
)
 
177
 
   Retained earnings
 
258,444
   
233,904
   
249,251
 
      Total Brown Shoe Company, Inc. shareholders’ equity
 
391,071
   
379,583
   
402,171
 
   Noncontrolling interests
 
474
   
8,673
   
9,056
 
Total equity
 
391,545
   
388,256
   
411,227
 
Total liabilities and equity
$
1,077,131
 
$
1,024,818
 
$
1,040,150
 
See notes to condensed consolidated financial statements.
 
2
 
 
BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS


 
(Unaudited)
 
(Unaudited)
 
 
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
($ thousands, except per share amounts )
July 31,
2010
 
August 1,
 2009
 
July 31,
2010
 
August 1,
2009
 
Net sales
$
585,756
 
$
511,621
 
$
1,183,474
 
$
1,050,361
 
Cost of goods sold
 
347,286
   
307,981
   
697,444
   
638,557
 
Gross profit
 
238,470
   
203,640
   
486,030
   
411,804
 
Selling and administrative expenses
 
224,448
   
206,620
   
448,963
   
419,337
 
Restructuring and other special charges, net
 
1,891
   
1,998
   
3,608
   
4,612
 
Operating earnings (loss)
 
12,131
   
(4,978
)
 
33,459
   
(12,145
)
Interest expense
 
(4,810
)
 
(4,914
)
 
(9,322
)
 
(10,163
)
Interest income
 
49
   
145
   
67
   
288
 
Earnings (loss) before income taxes
 
7,370
   
(9,747
)
 
24,204
   
(22,020
)
Income tax (provision) benefit
 
(2,582
)
 
5,531
   
(8,881
)
 
10,733
 
Net earnings (loss)
$
4,788
 
$
(4,216
)
$
15,323
 
$
(11,287
)
Less: Net (loss) earnings attributable to noncontrolling interests
 
(473
)
 
29
   
16
   
561
 
Net earnings (loss) attributable to Brown Shoe  Company, Inc.
$
5,261
 
$
(4,245
)
$
15,307
 
$
(11,848
)
                 
Basic earnings (loss) per common share attributable to Brown Shoe Company, Inc.  shareholders
$
0.12
 
$
(0.10
)
$
0.35
 
$
(0.28
)
                         
Diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc.  shareholders
$
0.12
 
$
(0.10
)
$
0.35
 
$
(0.28
)
                 
Dividends per common share
$
0.07
 
$
0.07
 
$
0.14
 
$
0.14
 
See notes to condensed consolidated financial statements.

 
3
 

BROWN SHOE COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 
(Unaudited)
 
 
Twenty-six Weeks Ended
 
($ thousands)
July 31, 2010
 
August 1, 2009
 
Operating Activities
           
Net earnings (loss)
$
15,323
 
$
(11,287
)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
           
   Depreciation
 
16,028
   
18,204
 
   Amortization of capitalized software
 
5,010
   
3,993
 
   Amortization of intangibles
 
3,350
   
3,387
 
   Amortization of debt issuance costs
 
1,098
   
1,098
 
   Share-based compensation expense
 
2,781
   
1,944
 
   Tax deficiency related to share-based plans
 
142
   
89
 
   Loss on disposal of facilities and equipment
 
617
   
293
 
   Impairment charges for facilities and equipment
 
1,684
   
2,094
 
   Deferred rent
 
(858
)
 
335
 
   Provision for doubtful accounts
 
80
   
477
 
   Foreign currency transaction gains
 
(11
)
 
(61
)
   Changes in operating assets and liabilities:
           
      Receivables
 
(21,923
)
 
11,643
 
      Inventories
 
(121,298
)
 
(59,120
)
      Prepaid expenses and other current and noncurrent assets
 
8,923
   
2,507
 
      Trade accounts payable
 
117,041
   
81,073
 
      Accrued expenses and other liabilities
 
(714
)
 
(4,391
)
   Other, net
 
(284
)
 
(2,567
)
Net cash provided by operating activities
 
26,989
   
49,711
 
             
Investing Activities
           
Purchases of property and equipment
 
(12,844
)
 
(17,911
)
Capitalized software
 
(11,871
)
 
(10,916
)
Net cash used for investing activities
 
(24,715
)
 
(28,827
)
             
Financing Activities
           
Borrowings under revolving credit agreement
 
435,500
   
394,900
 
Repayments under revolving credit agreement
 
(494,500
)
 
(459,900
)
Acquisition of noncontrolling interests (Edelman Shoe, Inc.)
 
(32,692
)
 
–
 
Dividends paid
 
(6,114
)
 
(6,006
)
Proceeds from stock options exercised
 
561
   
–
 
Tax deficiency related to share-based plans
 
(142
)
 
(89
)
Net cash used for financing activities
 
(97,387
)
 
(71,095
)
Effect of exchange rate changes on cash
 
4
   
585
 
Decrease in cash and cash equivalents
 
(95,109
)
 
(49,626
)
Cash and cash equivalents at beginning of period
 
125,833
   
86,900
 
Cash and cash equivalents at end of period
$
30,724
 
$
37,274
 
See notes to condensed consolidated financial statements.
 
 
4
 

BROWN SHOE COMPANY, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 


Note 1
Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q of the United States Securities and Exchange Commission (“SEC”) and reflect all adjustments and accruals of a normal recurring nature, which management believes are necessary to present fairly the financial position, results of operations and cash flows of Brown Shoe Company, Inc. (the “Company”). These statements, however, do not include all information and footnotes necessary for a complete presentation of the Company's consolidated financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries, after the elimination of intercompany accounts and transactions.

The Company’s business is seasonal in nature due to consumer spending patterns, with higher back-to-school and Christmas and Easter holiday season sales. Traditionally, the third fiscal quarter accounts for a substantial portion of earnings for the year. Interim results may not necessarily be indicative of results which may be expected for any other interim period or for the year as a whole.

Certain prior period amounts in the condensed consolidated financial statements have been reclassified to conform to the current period presentation. These reclassifications did not affect net earnings (loss) attributable to Brown Shoe Company, Inc.

For further information, refer to the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K for the year ended January 30, 2010.


Note 2
Impact of New and Prospective Accounting Pronouncements

In June 2009, the Financial Accounting Standards Board (“FASB”) issued a standard that changes the consolidation guidance applicable to a variable interest entity (“VIE”). The pronouncement also amends previous rules governing the determination of whether an enterprise is the primary beneficiary of a VIE, and is, therefore, required to consolidate an entity by requiring a qualitative analysis rather than a quantitative analysis. The qualitative analysis should include, among other things, consideration of who has the power to direct the activities of the entity that most significantly impact the entity’s economic performance and who has the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. This guidance also requires continuous reassessments of whether an enterprise is the primary beneficiary of a VIE and enhanced disclosures about an enterprise’s involvement with a VIE. The standard is effective as of the beginning of interim and annual reporting periods that begin after November 15, 2009. The Company adopted the guidance at the beginning of 2010. See Note 3 to the condensed consolidated financial statements for additional information.

In January 2010, the FASB issued guidance that provides amendments to Accounting Standards Codification 820, Fair Value Measurements and Disclosures , and requires more extensive disclosures about (a) transfers in and out of Levels 1 and 2; (b) activity in Level 3 fair value measurements; (c) different classes of assets and liabilities measured at fair value; and (d) the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. The guidance is effective for interim or annual reporting periods beginning after December 15, 2009, except for certain disclosures applicable to Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Accordingly, the Company adopted the guidance, except for certain disclosures applicable to Level 3 fair value measurements, at the beginning of 2010. See Note 13 to the condensed consolidated financial statements for additional information related to fair value measurements.
 
 
 
 

 
5
 


Note 3
Edelman Shoe, Inc.

Edelman Shoe, Inc. (“Edelman Shoe”) is a leading designer and marketer of fashion footwear. The Sam Edelman brand was launched in 2004 and is primarily sold through department stores and independent retailers.

In 2007, the Company invested cash of $7.1 million in Edelman Shoe, acquiring 42.5% of the outstanding stock. On November 3, 2008, the Company invested an additional $4.1 million of cash in Edelman Shoe, acquiring 7.5% of the outstanding stock, bringing the Company’s total equity interest to 50%.

Beginning November 3, 2008, the Company’s consolidated financial statements included the accounts of Edelman Shoe as a result of the Company’s determination that Edelman Shoe was a VIE, for which the Company was the primary beneficiary. At the beginning of fiscal 2010, the Company adopted amended consolidation guidance applicable to VIEs, evaluated the impact on the existing variable interests in Edelman Shoe and determined that Edelman Shoe continued to be a VIE that was appropriately consolidated by the Company.

On June 4, 2010, the Company acquired the remaining 50% of the outstanding stock of Edelman Shoe for $40.0 million, consisting of a combination of $32.7 million of cash, including transaction fees, and $7.3 million in shares of the Company’s common stock. The stock consideration consisted of 473,081 shares of the Company’s common stock. The acquisition of the remaining interest in Edelman Shoe was accounted for in accordance with the consolidation guidance applicable to noncontrolling interests, which requires changes in a parent’s ownership interest in a subsidiary, without loss of control, to be reflected as an adjustment to the carrying amount of the noncontrolling interest with excess consideration recognized directly to equity attributable to the controlling interest. As a result, the Company’s acquisition of the remaining interest in Edelman Shoe resulted in a reduction to total equity of $32.7 million, consisting of a net reduction of $24.1 million to total Brown Shoe Company, Inc. shareholders’ equity and the elimination of $8.6 million of the noncontrolling interest in Edelman Shoe. As of June 4, 2010, Edelman Shoe is a wholly-owned subsidiary of the Company. See Note 5 to the condensed consolidated financial statements for additional information related to the impact of the acquisition on total equity.



 
6
 

Note 4
Earnings Per Share

The Company uses the two-class method to compute basic and diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders. In periods of net loss, no effect is given to the Company’s participating securities since they do not contractually participate in the losses of the Company. The following table sets forth the computation of basic and diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders for the periods ended  July 31, 2010 and August 1, 2009:

 
   
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
(in thousands, except per share amounts )
 
July 31,
 2010
 
August 1,
 2009
 
July 31,
 2010
 
August 1,
2009
 
                       
NUMERATOR
                         
Net earnings (loss) attributable to Brown Shoe Company, Inc. before allocation of earnings to participating securities
 
$
5,261
 
$
(4,245
)
$
15,307
 
$
(11,848
)
Less: Earnings allocated to participating securities
   
188
   
–
   
535
   
–
 
Net earnings (loss) attributable to Brown Shoe Company, Inc. after allocation of earnings to participating securities
 
$
5,073
 
$
(4,245
)
$
14,772
 
$
(11,848
)
                       
DENOMINATOR
                         
Denominator for basic earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders
   
42,147
   
41,583
   
41,951
   
41,574
 
Dilutive effect of share-based awards
   
316
   
–
   
316
   
–
 
Denominator for diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders
   
42,463
   
41,583
   
42,267
   
41,574
 
                       
Basic earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders
 
$
0.12
 
$
(0.10
)
$
0.35
 
$
(0.28
)
                           
Diluted earnings (loss) per common share attributable to Brown Shoe Company, Inc. shareholders
 
$
0.12
 
$
(0.10
)
$
0.35
 
$
(0.28
)

Options to purchase 795,654 and 797,154 shares of common stock for the thirteen weeks and twenty-six weeks ended July 31, 2010 were not included in the denominator for diluted earnings per common share attributable to Brown Shoe Company, Inc. shareholders because the effect would be antidilutive. Due to the Company’s net loss attributable to Brown Shoe Company, Inc. for the thirteen weeks and twenty-six weeks ended August 1, 2009, the denominator for diluted loss per common share attributable to Brown Shoe Company, Inc. shareholders is the same as the denominator for basic loss per common share attributable to Brown Shoe Company, Inc. shareholders.

 
7
 

Note 5
Comprehensive Income (Loss) and Changes in Equity

Comprehensive income (loss) includes changes in equity related to foreign currency translation adjustments and unrealized gains or losses from derivatives used for hedging activities.

The following table sets forth the reconciliation from net earnings (loss) to comprehensive income (loss) for the periods ended July 31, 2010 and August 1, 2009:

                   
   
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
($ thousands )
 
July 31,
 2010
 
August 1,
 2009
 
July 31,
  2010
  August 1,
   2009
 
Net earnings (loss)
 
$
4,788
 
$
(4,216
)
$
15,323
 
$
(11,287
)
                           
Other comprehensive income (loss) (“OCI”), net of tax:
                         
   Foreign currency translation adjustment
   
(80
)
 
2,767
   
1,040
   
2,661
 
   Unrealized gains (losses) on derivative instruments, net of tax of $185 and $484 in the thirteen weeks and $44 and $515 in the twenty-six weeks ended July 31, 2010 and August 1, 2009, respectively
   
482
   
(1,112
)
 
187
   
(1,277
)
   Net loss from derivatives reclassified into earnings, net of tax of $35 and $71 in the thirteen weeks and $89 and $68 in the twenty-six weeks ended July 31, 2010 and August 1, 2009, respectively
   
64
   
142
   
169
   
120
 
     
466
   
1,797
   
1,396
   
1,504
 
Comprehensive income (loss)
 
$
5,254
 
$
(2,419
)
$
16,719
 
$
(9,783
)
Less: Comprehensive (loss) income attributable  to noncontrolling interests
   
(467
)
 
31
   
22
   
563
 
Comprehensive income (loss) attributable to  Brown Shoe Company, Inc.
 
$
5,721
 
$
(2,450
)
$
16,697
 
$
(10,346
)
 
 
The following table sets forth the balance in accumulated other comprehensive income (loss) for the Company at July 31, 2010, August 1, 2009 and January 30, 2010:
             
($ thousands)
July 31,
2010
 
August 1,
2009
 
January 30,
 2010
 
Foreign currency translation gains
$
5,188
 
$
3,379
 
$
4,154
 
Unrealized losses on derivative instruments, net of tax
 
(361
)
 
(889
)
 
(717
)
Pension and other postretirement benefits, net of tax
 
(3,260
)
 
(6,769
)
 
(3,260
)
Accumulated other comprehensive income (loss)
$
1,567
 
$
(4,279
)
$
177
 

See additional information related to derivative instruments in Note 12 and Note 13 and additional information related to pension and other postretirement benefits in Note 10 to the condensed consolidated financial statements.
 
8
 

The following tables set forth the changes in Brown Shoe Company, Inc. shareholders’ equity and noncontrolling interests for the twenty-six weeks ended July 31, 2010 and August 1, 2009:
             
($ thousands)
Brown Shoe Company, Inc.
Shareholders’ Equity
 
Noncontrolling
Interests
 
Total Equity
 
Equity at January 30, 2010
$
402,171
 
$
9,056
 
$
411,227
 
Comprehensive income
 
16,697
   
22
   
16,719
 
Dividends paid
 
(6,114
)
 
–
   
(6,114
)
Acquisition of noncontrolling interest (Edelman Shoe, Inc.)
                 
Stock issued in connection with the acquisition of the noncontrolling interest
 
7,309
   
–
   
7,309
 
Distribution to noncontrolling interest
 
(31,397
)
 
(8,604
)
 
(40,001
)
Stock issued under share-based plans
 
(234
)
 
–
   
(234
)
Tax deficiency related to share-based plans
 
(142
)
 
–
   
(142
)
Share-based compensation expense
 
2,781
   
–
   
2,781
 
Equity at July 31, 2010
$
391,071
 
$
474
 
$
391,545
 

             
($ thousands)
Brown Shoe Company, Inc.
Shareholders’ Equity
 
Noncontrolling
Interests
 
Total Equity
 
Equity at January 31, 2009
$
394,104
 
$
8,110
 
$
402,214
 
Comprehensive (loss) income
 
(10,346
)
 
563
   
(9,783
)
Dividends paid
 
(6,006
)
 
–
   
(6,006
)
Stock issued under share-based plans
 
(24
)
 
–
   
(24
)
Tax deficiency related to share-based plans
 
(89
)
 
–
   
(89
)
Share-based compensation expense
 
1,944
   
–
   
1,944
 
Equity at August 1, 2009
$
379,583
 
$
8,673
 
$
388,256
 


Note 6
Restructuring and Other Special Charges, Net

Information Technology Initiatives
During 2008, the Company began implementation of an integrated enterprise resource planning (“ERP”) information technology system provided by third-party vendors. The ERP information technology system is replacing select existing internally developed and certain other third-party applications, and is expected to better support the Company’s business model. The Company expects the implementation will enhance its profitability through improved management and execution of its business operations, financial systems, supply chain efficiency and planning and employee productivity. The phased implementation began during 2008 and is expected to be substantially complete in the fourth quarter of 2010. The Company incurred expenses of $1.9 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) and $3.6 million ($2.4 million on an after-tax basis, or $0.06 per diluted share) during the thirteen weeks and twenty-six weeks ended July 31, 2010, respectively, as a component of restructuring and other special charges, net, related to these initiatives. Of the $1.9 million in expenses recorded during the thirteen weeks ended July 31, 2010, $1.7 million was recorded in the Other segment and $0.2 million was recorded in the Wholesale Operations segment. The Company incurred expenses of $2.0 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) and $4.6 million ($3.0 million on an after-tax basis, or $0.07 per diluted share) during the thirteen weeks and twenty-six weeks ended August 1, 2009, respectively, as a component of restructuring and other special charges, net, related to these initiatives. Of the $2.0 million in expenses recorded during the thirteen weeks ended August 1, 2009, $1.9 million was recorded in the Other segment and $0.1 million was recorded in the Wholesale Operations segment. During the full year of 2008, the Company incurred expenses of $3.7 million ($2.4 million on an after-tax basis, or $0.06 per diluted share), and these expenses were reflected within the Other segment. During the full year of 2009, the Company incurred expenses of $9.2 million ($5.8 million on an after-tax basis, or $0.14 per diluted share) of which $0.3 million was recorded in the Wholesale Operations segment, and the remaining expense was recorded in the Other segment.

 
9
 
Organizational Changes
During November 2009, the Company made a series of changes within its leadership team as two executives announced plans to retire in early to mid-2010. During the fourth quarter of 2009, the Company incurred charges of $4.6 million ($2.8 million on an after-tax basis, or $0.07 per diluted share), related to their retirement. All of the costs recorded during 2009 were reflected within the Other segment as a component of restructuring and other special charges, net. During the first half of 2010, no additional charges were incurred. During the second quarter of 2010, the Company recorded settlements of $2.0 million in connection with the retirements, resulting in total settlements of $4.2 million during the first half of 2010, and a $0.4 million remaining liability as of July 31, 2010.

Expense and Capital Containment Initiatives
During 2008, the Company announced expense and capital containment initiatives in an effort to proactively position itself for continued challenges in the retail environment. These initiatives included a voluntary separation program, changes in compensation structure, further rationalization of operating expenses and the closing of certain functions at its Fredericktown, Missouri, distribution center. The Company incurred charges of $30.9 million ($19.1 million on an after-tax basis, or $0.46 per diluted share) during 2008. These costs included employee-related costs for severance, including healthcare benefits and enhanced pension benefits, as well as facility and other costs. The Company incurred no related charges during 2009 and the first half of 2010.

The following is a summary of the charges and settlements by category of costs:
                     
($ millions)
   
Employee
Severance
 
Facility
 
Other
 
Total
 
Original charges and reserve balance
     
$
24.7
 
$
6.0
 
$
0.2
 
$
30.9
 
 Amounts settled in 2008
       
(5.3
)
 
(2.7
)
 
–
   
(8.0
)
 Reserve balance at January 31, 2009
     
$
19.4
 
$
3.3
 
$
0.2
 
$
22.9
 
 Amounts settled in 2009
       
(15.3
)
 
(2.1
)
 
(0.2
)
 
(17.6
)
 Reserve balance at January 30, 2010
     
$
4.1
 
$
1.2
 
$
–
 
$
5.3
 
 Amounts settled in first quarter 2010
       
(2.3
)
 
(0.2
)
 
–
   
(2.5
)
 Reserve balance at May 1, 2010
     
$
1.8
 
$
1.0
 
$
–
 
$
2.8
 
 Amounts settled in second quarter 2010
       
(0.1
)
 
(1.0
)
 
–
   
(1.1
)
 Reserve balance at July 31, 2010
     
$
1.7
 
$
–
 
$
–
 
$
1.7
 
                               
Of the $30.9 million in costs recorded during 2008, $14.4 million was recorded in the Wholesale Operations segment, $12.1 million was recorded in the Other segment, $3.8 million was recorded in the Famous Footwear segment and $0.6 million was recorded in the Specialty Retail segment. All of the costs recorded during 2008 were reflected as a component of restructuring and other special charges, net. A tax benefit of $11.8 million associated with the costs was recorded during 2008. The write-off of assets during 2008 of $0.5 million, included in facility costs, was a noncash item.

Headquarters Consolidation
During 2008, the Company relocated its Famous Footwear division headquarters from Madison, Wisconsin, to St. Louis, Missouri, to foster collaboration, increase the Company’s speed to market and strengthen its connection with consumers. The Company incurred charges of $29.8 million ($18.2 million on an after-tax basis, or $0.44 per diluted share) during 2008. These costs included employee-related costs for relocation, severance, recruiting and retention, as well as facility and other costs. All of the costs recorded during 2008 were reflected within the Other segment as a component of restructuring and other special charges, net. During 2008, a tax benefit of $11.6 million associated with the costs was recorded. The write-off of assets during 2008 of $3.4 million, included in facility costs, was a noncash item. During 2009, the Company recorded income of $1.9 million ($1.1 million on an after-tax basis, or $0.03 per diluted share) as a result of an expanded sublease arrangement.  The Company incurred no related charges during the first half of 2010.
 
10
 
The following is a summary of the charges and settlements by category of costs:
                           
($ millions)
Employee
Severance
 
Employee
Relocation
 
Employee
Recruiting
 
Facility
 
Other
 
Total
   
Original charges and reserve  balance
$
6.6
 
$
8.3
 
$
4.6
 
$
9.2
 
$
1.1
 
$
29.8
   
Amounts settled in 2008
 
(4.7
)
 
(6.2
)
 
(4.3
)
 
(3.6
)
 
(1.0
)
 
(19.8
)
 
Reserve balance at January 31, 2009
$
1.9
 
$
2.1
 
$
0.3
 
$
5.6
 
$
0.1
 
$
10.0
   
Reserve reduction in 2009
 
–
   
–
   
–
   
(1.9
)
 
–
   
(1.9
)
 
Amounts settled in 2009
 
(1.9
)
 
(1.7
)
 
(0.2
)
 
(1.9
)
 
(0.1
)
 
(5.8
)
 
Reserve balance at January 30, 2010
$
–
 
$
0.4
 
$
0.1
 
$
1.8
 
$
–
 
$
2.3
   
Amounts settled in first  quarter 2010
 
–
   
–
   
–
   
(0.3
)
 
–
   
(0.3
)
 
Reserve balance at May 1, 2010
$
–
 
$
0.4
 
$
0.1
 
$
1.5
 
$
–
 
$
2.0
   
Amounts settled in second  quarter 2010
 
–
   
(0.4
)
 
(0.1
)
 
(0.4
)
 
–
   
(0.9
)
 
Reserve balance at July 31, 2010
$
–
 
$
–
 
$
–
 
$
1.1
 
$
–
 
$
1.1
   


Note 7
Business Segment Information

Applicable business segment information is as follows for the periods ended July 31, 2010 and August 1, 2009:
                     
($ thousands)
Famous
Footwear
 
Wholesale
Operations
 
Specialty
Retail
 
Other
 
Total
 
                     
Thirteen Weeks Ended July 31, 2010
                   
External sales
$
347,316
 
$
178,643
 
$
59,797
 
$
–
 
$
585,756
 
Intersegment sales
 
438
   
47,215
   
–
   
–
   
47,653
 
Operating earnings (loss)
 
15,751
   
9,027
   
(2,746
)
 
(9,901
)
 
12,131
 
Operating segment assets
 
548,683
   
348,148
   
54,629
   
125,671
   
1,077,131
 
                               
Thirteen Weeks Ended August 1, 2009
                   
External sales
$
314,144
 
$
142,027
 
$
55,450
 
$
–
 
$
511,621
 
Intersegment sales
 
471
   
52,462
   
–
   
–
   
52,933
 
Operating (loss) earnings
 
(846
)
 
7,882
   
(4,301
)
 
(7,713
)
 
(4,978
)
Operating segment assets
 
527,013
   
293,005
   
75,703
   
129,097
   
1,024,818
 
                               
Twenty-six Weeks Ended July 31, 2010
                   
External sales
$
709,486
 
$
353,372
 
$
120,616
 
$
–
 
$
1,183,474
 
Intersegment sales
 
971
   
88,328
   
–
   
–
   
89,299
 
Operating earnings (loss)
 
43,934
   
17,706
   
(5,655
)
 
(22,526
)
 
33,459
 
                               
Twenty-six Weeks Ended August 1, 2009
                   
External sales
$
631,707
 
$
310,851
 
$
107,803
 
$
–
 
$
1,050,361
 
Intersegment sales
 
1,112
   
97,557
   
–
   
–
   
98,669
 
Operating earnings (loss)
 
2,195
   
13,792
   
(10,527
)
 
(17,605
)
 
(12,145
)

The Other segment includes corporate assets and administrative expenses and other costs and recoveries which are not allocated to the operating segments.
 
11
 
During the thirteen weeks and twenty-six weeks ended July 31, 2010, operating loss of the Other segment included costs related to the Company’s information technology initiatives of $1.7 million and $3.3 million, respectively. During the thirteen weeks and twenty-six weeks ended July 31, 2010, operating earnings of the Company’s Wholesale Operations segment included costs related to the information technology initiatives of $0.2 million and $0.3 million, respectively.

During the thirteen weeks and twenty-six weeks ended August 1, 2009, operating loss of the Other segment included costs related to the Company’s information technology initiatives of $1.9 million and $4.6 million, respectively. The operating earnings of the Company’s Wholesale Operations segment included expenses of $0.1 million for the thirteen weeks ended August 1, 2009 related to the information technology initiatives.

Following is a reconciliation of operating earnings (loss) to earnings (loss) before income taxes:
                   
   
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
($ thousands )
 
July 31,
2010
 
August 1,
2009
 
July 31,
2010
 
August 1,
2009
 
Operating earnings (loss)
 
$
12,131
 
$
(4,978
)
$
33,459
 
$
(12,145
)
Interest expense
   
(4,810
)
 
(4,914
)
 
(9,322
)
 
(10,163
)
Interest income
   
49
   
145
   
67
   
288
 
Earnings (loss) before income taxes
 
$
7,370
 
$
(9,747
)
$
24,204
 
$
(22,020
)


Note 8
Intangible Assets

Intangible assets were attributable to the Company's operating segments as follows:
             
($ thousands)
July 31, 2010
 
August 1, 2009
 
January 30, 2010
 
                   
Famous Footwear
$
2,800
 
$
2,800
 
$
2,800
 
Wholesale Operations
 
70,876
   
77,613
   
74,226
 
Specialty Retail
 
200
   
200
   
200
 
 
$
73,876
 
$
80,613
 
$
77,226
 

As of July 31, 2010, the Company had intangible assets of $73.9 million, primarily related to trademarks. The decline in the intangible assets of the Company’s Wholesale Operations segment from August 1, 2009 to January 30, 2010 and July 31, 2010 reflected amortization of its licensed and owned trademarks.


Note 9
Share-Based Compensation

During the second quarter of 2010, the Company granted 2,000 stock options to certain employees with a weighted-average exercise price and grant date fair value of $17.45 and $9.73, respectively. These options vest in four equal increments, with 25% vesting over each of the next four years. These options have a term of ten years. Share-based compensation expense is recognized on a straight-line basis separately for each vesting portion of the stock option award. 

The Company also granted 2,000 restricted shares to certain employees with a weighted-average grant date fair value of $17.45 during the second quarter of 2010. The restricted shares granted to employees vest in four years and share-based compensation expense will be recognized on a straight-line basis over the four-year period.

The Company also granted 7,614 restricted shares to non-employee directors with a weighted-average grant date fair value of $16.63 during the second quarter of 2010. Of the 7,614 restricted shares granted, 1,514 of the restricted shares vested and share-based compensation expense was fully recognized during the second quarter of 2010 and 6,100 of the restricted shares vest in one year and share-based compensation expense will be recognized on a straight-line basis over the one-year period.

 
12
 
The Company recognized share-based compensation expense of $1.4 million and $0.6 million during the thirteen weeks and $2.8 million and $1.9 million during the twenty-six weeks ended July 31, 2010 and August 1, 2009, respectively. The Company issued 11,171 shares and 548,031 shares of common stock during the thirteen and twenty-six weeks ended July 31, 2010, respectively, for restricted stock grants and directors’ fees. During the thirteen and twenty-six weeks ended July 31, 2010, the Company cancelled 39,406 and 84,719 shares, respectively, of common stock as a result of forfeitures of restricted stock awards.

The Company also granted 61,973 restricted stock units to non-employee directors with a weighted-average grant date fair value of $16.60 during the second quarter of 2010.  Of the 61,973 restricted stock units granted, 973 of the restricted stock units vested and compensation expense was fully recognized during the second quarter of 2010 and 61,000 of the restricted stock units vest in one year and compensation expense will be recognized ratably over the one-year period based upon the fair value of the restricted stock units, as remeasured at the end of each period.


Note 10
Retirement and Other Benefit Plans

The following tables set forth the components of net periodic benefit cost (income) for the Company, including all domestic and Canadian plans:
                 
 
Pension Benefits
 
Other Postretirement Benefits
 
 
Thirteen Weeks Ended
 
Thirteen Weeks Ended
 
($ thousands)
July 31,
 2010
 
August 1,
2009
 
July 31,
 2010
 
August 1,
 2009
 
Service cost
$
2,000
 
$
1,683
 
$
–
 
$
–
 
Interest cost
 
3,042
   
2,783
   
44
   
50
 
Expected return on assets
 
(5,039
)
 
(4,878
)
 
–
   
–
 
Settlement cost
 
–
   
52
   
–
   
–
 
Amortization of:
                       
   Actuarial loss (gain)
 
59
   
29
   
(33
)
 
(21
)
   Prior service income
 
(3
)
 
–
   
–
   
–
 
   Net transition asset
 
(11
)
 
(34
)
 
–
   
–
 
Total net periodic benefit cost (income)
$
48
 
$
(365
)
$
11
 
$
29
 


                 
 
Pension Benefits
 
Other Postretirement Benefits
 
 
Twenty-six Weeks Ended
 
Twenty-six Weeks Ended
 
($ thousands)
July 31,
 2010
 
August 1,
 2009
 
July 31,
2010
 
August 1,
2009
 
Service cost
$
3,826
 
$
3,393
 
$
–
 
$
–
 
Interest cost
 
6,029
   
5,779
   
97
   
109
 
Expected return on assets
 
(10,103
)
 
(9,757
)
 
–
   
–
 
Settlement cost
 
–
   
127
   
–
   
–
 
Amortization of:
                       
   Actuarial loss (gain)
 
85
   
56
   
(48
)
 
(42
)
   Prior service income
 
(3
)
 
(6
)
 
–
   
–
 
   Net transition asset
 
(22
)
 
(65
)
 
–
   
–
 
Total net periodic benefit (income) cost
$
(188
)
$
(473
)
$
49
 
$
67
 

 
13
 

Note 11
Long-Term and Short-Term Financing Arrangements

Credit Agreement
On January 21, 2009, the Company and certain of its subsidiaries (the “Loan Parties”) entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”). The Credit Agreement matures on January 21, 2014. The Credit Agreement provides for revolving credit in an aggregate amount of up to $380.0 million, subject to the calculated borrowing base restrictions. Borrowing availability under the Credit Agreement is limited to the lesser of the total commitments and the borrowing base, which is based on stated percentages of the sum of eligible receivables and inventories, less applicable reserves. Under the Credit Agreement, the Loan Parties’ obligations are secured by a first priority security interest in receivables, inventories and certain other collateral.

Interest on borrowings is at variable rates based on the London Inter-Bank Offered Rate (“LIBOR”) or the prime rate, as defined in the Credit Agreement. The interest rate and fees for letters of credit varies based upon the level of excess availability under the Credit Agreement. There is an unused line fee payable on the excess availability under the facility and a letter of credit fee payable on the outstanding exposure under letters of credit.
 
The Credit Agreement limits the Company’s ability to incur additional indebtedness, create liens, make investments or specified payments, give guarantees, pay dividends, make capital expenditures and merge or acquire or sell assets. In addition, certain additional covenants would be triggered if excess availability were to fall below specified levels, including fixed charge coverage ratio requirements. Furthermore, if excess availability falls below the greater of (i) 17.5% of the lesser of (x) the borrowing base or (y) the total commitments and (ii) $25.0 million for three consecutive business days, or an event of default occurs, the lenders may assume dominion and control over the Company’s cash (a “cash dominion event”) until such event of default is cured or waived or the excess availability exceeds such amount for 30 consecutive days.
 
The Credit Agreement contains customary events of default, including, without limitation, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to similar obligations, certain events of bankruptcy and insolvency, judgment defaults and the failure of any guaranty or security document supporting the agreement to be in full force and effect. In addition, if the excess availability falls below the greater of (i) 17.5% of the lesser of (x) the borrowing base or (y) the total commitments and (ii) $25.0 million and the fixed charge coverage ratio is less than 1.0 to 1.0, the Company would be in default under the Credit Agreement. The Credit Agreement also contains certain other covenants and restrictions, with which the Company was in compliance as of July 31, 2010.

At July 31, 2010, the Company had $35.5 million outstanding and $12.6 million in letters of credit outstanding under the Credit Agreement. Total additional borrowing availability was $331.9 million as of July 31, 2010.

Senior Notes
In April 2005, the Company issued $150.0 million of 8.75% senior notes due in 2012 (“Senior Notes”). The Senior Notes are guaranteed on a senior unsecured basis by each of the subsidiaries of Brown Shoe Company, Inc. that is an obligor under the Credit Agreement. Interest on the Senior Notes is payable on May 1 and November 1 of each year. The Senior Notes mature on May 1, 2012, but became callable on May 1, 2009.  The Company may redeem all or a part of the Senior Notes at specified redemption prices (expressed as a percentage of principal amount) set forth below, plus accrued and unpaid interest, if redeemed during the twelve-month period beginning on May 1 of the years indicated below:

                   
Year
             
Percentage
 
2010
                     
102.188
%
2011 and thereafter
                     
100.000
%

The Senior Notes also contain certain other covenants and restrictions that limit certain activities including, among other things, levels of indebtedness, payments of dividends, the guarantee or pledge of assets, certain investments, common stock repurchases, mergers and acquisitions and sales of assets. As of July 31, 2010, the Company was in compliance with all covenants relating to the Senior Notes.
 
14
 

Note 12
Risk Management and Derivatives

In the normal course of business, the Company’s financial results are impacted by currency rate movements in foreign currency denominated assets, liabilities and cash flows as it makes a portion of its purchases and sales in local currencies. The Company has established policies and business practices that are intended to mitigate a portion of the effect of these exposures. The Company uses derivative financial instruments, primarily forward contracts, to manage its currency exposures. These derivative instruments are viewed as risk management tools and are not used for trading or speculative purposes. Derivatives entered into by the Company are designated as cash flow hedges of forecasted foreign currency transactions.

Derivative financial instruments expose the Company to credit and market risk. The market risk associated with these instruments resulting from currency exchange movements is expected to offset the market risk of the underlying transactions being hedged. The Company does not believe there is a significant risk of loss in the event of non-performance by the counterparties associated with these instruments because these transactions are executed with major financial institutions and have varying maturities through July 2011. Credit risk is managed through the continuous monitoring of exposures to such counterparties.

The Company principally uses foreign currency forward contracts as cash flow hedges to offset a portion of the effects of exchange rate fluctuations. The Company’s cash flow exposures include anticipated foreign currency transactions, such as foreign currency denominated sales, costs, expenses, intercompany charges, as well as collections and payments. The Company performs a quarterly assessment of the effectiveness of the hedge relationship and measures and recognizes any hedge ineffectiveness in the condensed consolidated statement of earnings. Hedge ineffectiveness is evaluated using the hypothetical derivative method, and the ineffective portion of the hedge is reported in the Company’s condensed consolidated statement of earnings. The amount of hedge ineffectiveness for the quarter ended July 31, 2010 was not material.

The Company’s hedging strategy uses forward contracts as cash flow hedging instruments, which are recorded in the Company’s condensed consolidated balance sheet at fair value. The effective portion of gains and losses resulting from changes in the fair value of these hedge instruments are deferred in accumulated other comprehensive income (loss) and reclassified to earnings in the period that the hedged transaction is recognized in earnings.

As of July 31, 2010, January 30, 2010 and August 1, 2009, the Company had forward contracts maturing at various dates through July 2011, January 2011 and August 2010, respectively. The contract amount represents the net amount of all purchase and sale contracts of a foreign currency.
 
(U.S. $ equivalent in thousands)
Contract Amount
July 31, 2010
 
Contract Amount
August 1, 2009
 
Contract Amount
  January 30, 2010
Deliverable Financial Instruments
               
U.S. dollars (purchased by the Company’s Canadian division with Canadian dollars)
$
19,040
 
$
14,182
 
$
14,851
Euro
 
7,244
   
4,564
   
5,545
Other currencies
 
191
   
–
   
–
Non-deliverable Financial Instruments
               
Chinese yuan
 
12,531
   
10,264
   
12,042
Japanese yen
 
1,552
   
1,793
   
1,549
New Taiwanese dollars
 
1,155
   
1,242
   
1,192
Other currencies
 
716
   
628
   
723
 
$
42,429
 
$
32,673
 
$
35,902
 
 
15
 
As of July 31, 2010, the fair values of derivative instruments included within the condensed consolidated balance sheet were as follows:
                         
   
Asset Derivatives
   
Liability Derivatives
 
($ in thousands)
 
Balance Sheet Location
 
Fair Value
   
Balance Sheet Location
 
Fair Value
 
Derivatives designated as hedging instruments:
                       
Foreign exchange forward contracts
 
Prepaid expenses and other  current assets
 $
 
165
   
Other accrued expenses
 
$
715
 
                     
                         

As of August 1, 2009, the fair values of derivative instruments included within the condensed consolidated balance sheet were as follows:
                         
   
Asset Derivatives
   
Liability Derivatives
 
($ in thousands)
 
Balance Sheet Location
 
Fair Value
   
Balance Sheet Location
 
Fair Value
 
Derivatives designated as hedging
   instruments:
                       
Foreign exchange forward contracts
 
Prepaid expenses and other  current assets
 $
 
276
   
Other accrued expenses
 
$
1,318
 
                     
                         

As of January 30, 2010, the fair values of derivative instruments included within the condensed consolidated balance sheet were as follows:
                         
   
Asset Derivatives
   
Liability Derivatives
 
($ in thousands)
 
Balance Sheet Location
 
Fair Value
   
Balance Sheet Location
 
Fair Value
 
Derivatives designated as hedging
   instruments:
                       
Foreign exchange forward contracts
 
Prepaid expenses and other  current assets
 $
 
88
   
Other accrued expenses
 
$
689
 
                     
                         
 
For the thirteen weeks ended July 31, 2010, the effect of derivative instruments on the condensed consolidated statement of earnings was as follows:
                                     
  ($ in thousands)
     
Location of Loss
 
Amount of Loss
 
   
Amount of (Loss)/Gain
 
Reclassified from
 
Reclassified from
 
Derivatives in Cash Flow
 
Recognized in OCI on
 
Accumulated OCI into
 
Accumulated OCI into
 
   Hedging Relationships:
 
Derivatives
 
Earnings
 
Earnings
 
Foreign exchange forward
   contracts
         
$
(104
)
 
Net sales
         
$
30
 
Foreign exchange forward
   contracts
           
859
   
Cost of goods sold
           
20
 
Foreign exchange forward
   contracts
           
(94
)
 
Selling and administrative
   expenses
           
49
 
Foreign exchange forward
   contracts
           
6
   
Interest expense
           
–
 

 
16
 
For the thirteen weeks ended August 1, 2009, the effect of derivative instruments on the condensed consolidated statement of earnings was as follows:
                                     
  ($ in thousands)
     
Location of Loss
 
Amount of Loss
 
   
Amount of Loss
 
Reclassified from
 
Reclassified from
 
Derivatives in Cash Flow
 
Recognized in OCI on
 
Accumulated OCI into
 
Accumulated OCI into
 
   Hedging Relationships:
 
Derivatives
 
Earnings
 
Earnings
 
Foreign exchange forward
   contracts
         
$
(113
)
 
Net sales
         
$
48
 
Foreign exchange forward
   contracts
           
(1,085
)
 
Cost of goods sold
           
12
 
Foreign exchange forward
   contracts
           
(381
)
 
Selling and administrative
   expenses
           
153
 
Foreign exchange forward
   contracts
           
(17
)
 
Interest expense
           
–
 

For the twenty-six weeks ended July 31, 2010, the effect of derivative instruments on the condensed consolidated statement of earnings was as follows:
                                     
  ($ in thousands)
     
Location of Loss
 
Amount of Loss
 
   
Amount of (Loss)/Gain
 
Reclassified from
 
Reclassified from
 
Derivatives in Cash Flow
 
Recognized in OCI on
 
Accumulated OCI into
 
Accumulated OCI into
 
   Hedging Relationships:
 
Derivatives
 
Earnings
 
Earnings
 
Foreign exchange forward
   contracts
         
$
(118
)
 
Net sales
         
$
108
 
Foreign exchange forward
   contracts
           
580
   
Cost of goods sold
           
48
 
Foreign exchange forward
   contracts
           
(230
)
 
Selling and administrative
   expenses
           
102
 
Foreign exchange forward
   contracts
           
(1
)
 
Interest expense
           
–
 

For the twenty-six weeks ended August 1, 2009, the effect of derivative instruments on the condensed consolidated statement of earnings was as follows:
                                     
  ($ in thousands)
     
Location of Loss
 
Amount of Loss
 
   
Amount of Loss
 
Reclassified from
 
Reclassified from
 
Derivatives in Cash Flow
 
Recognized in OCI on
 
Accumulated OCI into
 
Accumulated OCI into
 
   Hedging Relationships:
 
Derivatives
 
Earnings
 
Earnings
 
Foreign exchange forward
   contracts
         
$
(8
)
 
Net sales
         
$
45
 
Foreign exchange forward
   contracts
           
(1,430
)
 
Cost of goods sold
           
12
 
Foreign exchange forward
   contracts
           
(322
)
 
Selling and administrative
   expenses
           
131
 
Foreign exchange forward
   contracts
           
(32
)
 
Interest expense
           
–
 

 
17
 
During 2009, the effect of derivative instruments on the consolidated statement of earnings was as follows:
                                     
  ($ in thousands)
     
Location of Loss
 
Amount of Loss
 
   
Amount of Loss
 
Reclassified from
 
Reclassified from
 
Derivatives in Cash Flow
 
Recognized in OCI on
 
Accumulated OCI into
 
Accumulated OCI into
 
   Hedging Relationships:
 
Derivatives
 
Earnings
 
Earnings
 
Foreign exchange forward
   contracts
         
$
(113
)
 
Net sales
         
$
100
 
Foreign exchange forward
   contracts
           
(1,330
)
 
Cost of goods sold
           
118
 
Foreign exchange forward
   contracts
           
(175
)
 
Selling and administrative
   expenses
           
23
 
Foreign exchange forward
   contracts
           
(9
)
 
Interest expense
           
2
 

All of the gains and losses included within accumulated other comprehensive income (loss) associated with the Company’s foreign exchange forward contracts at July 31, 2010, are expected to be reclassified into its net earnings within the next 12 months. Additional information related to the Company’s derivative financial instruments are disclosed within Note 13 to the condensed consolidated financial statements.


Note 13
Fair Value Measurements

Fair Value Hierarchy
FASB guidance on fair value measurements and disclosures specifies a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (“observable inputs”) or reflect the Company’s own assumptions of market participant valuation (“unobservable inputs”). In accordance with the fair value guidance, the hierarchy is broken down into three levels based on the reliability of the inputs as follows:

·
Level 1 – Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities;

·
Level 2 – Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly;

·
Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
 
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Classification of the financial or non-financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

Measurement of Fair Value
The Company measures fair value as an exit price, the price to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date, using the procedures described below for all financial and non-financial assets and liabilities measured at fair value.
 
18
 
Money Market Funds
The Company has cash equivalents consisting of short-term money market funds backed by U.S. Treasury securities. The primary objective of these investing activities is to preserve its capital for the purpose of funding operations and it does not enter into money market funds for trading or speculative purposes. The fair value is based on unadjusted quoted market prices for the funds in active markets with sufficient volume and frequency (Level 1).

Deferred Compensation Plan Assets
The Company maintains a non-qualified deferred compensation plan (the “Deferred Compensation Plan”) for the benefit of certain management employees. The investment funds selected by the participant generally correspond to the funds offered in the Company’s 401(k) plan, and the account balance fluctuates with the investment returns on those funds. The Deferred Compensation Plan permits the deferral of up to 50% of base salary and 100% of compensation received under the Company’s annual incentive plan. The deferrals are held in a separate trust, which has been established by the Company to administer the Deferred Compensation Plan. The assets of the trust are subject to the claims of the Company’s creditors in the event that the Company becomes insolvent. Consequently, the trust qualifies as a grantor trust for income tax purposes (i.e., a “Rabbi Trust”). The liabilities of the Deferred Compensation Plan are presented in other accrued expenses and the assets held by the trust are classified as trading securities within prepaid expenses and other current assets in the accompanying condensed consolidated balance sheets. Changes in deferred compensation are charged to selling and administrative expenses. The fair value is based on unadjusted quoted market prices for the funds in active markets with sufficient volume and frequency (Level 1).

Deferred Compensation Plan for Non-Employee Directors
Non-employee directors are eligible to participate in a deferred compensation plan, whereby deferred compensation amounts are valued as if invested in the Company’s common stock through the use of phantom stock units (“PSUs”).  Under the plan, each participating director’s account is credited with the number of PSUs that is equal to the number of shares of the Company’s common stock which the participant could purchase or receive with the amount of the deferred compensation, based upon the fair value (as determined based on the average of the high and low prices) of the Company’s common stock on the last trading day of the fiscal quarter when the cash compensation was earned.  Dividend equivalents are paid on PSUs at the same rate as dividends on the Company’s common stock, and are re-invested in additional PSUs at the next fiscal quarter-end.  The PSUs are payable in cash based on the number of PSUs credited to the participating director’s account, valued on the basis of the fair value at fiscal quarter-end on or following termination of the director’s service.  The liabilities of the plan of are based on the fair value of the outstanding PSUs and are presented in other liabilities in the accompanying condensed consolidated balance sheets.  Gains and losses resulting from changes in the fair value of the PSUs are reported in the Company’s condensed consolidated statement of earnings. The fair value is based on an unadjusted quoted market price for the Company’s common stock in an active market with sufficient volume and frequency (Level 1).

Derivative Financial Instruments
The Company uses derivative financial instruments, primarily foreign exchange contracts, to reduce its exposure to market risks from changes in foreign exchange rates. These foreign exchange contracts are measured at fair value using quoted forward foreign exchange prices from counterparties corroborated by market-based pricing (Level 2). Additional information related to the Company’s derivative financial instruments are disclosed within Note 12 to the condensed consolidated financial statements.


 
19
 
The table below presents the Company’s assets and liabilities that are measured at fair value on a recurring basis at July 31, 2010, August 1, 2009 and January 30, 2010. The Company did not have any transfers between Level 1 and Level 2 during 2009 or the first half of 2010.
                 
       
Fair Value Measurements
 
($ thousands)
 
Total
   
Level 1
   
Level 2
   
Level 3
 
Asset (Liability)
                       
 
As of July 31, 2010:
                       
Non-qualified deferred compensation plan assets
$
1,226
 
$
1,226
 
$
–
 
$
–
 
Non-qualified deferred compensation plan liabilities
 
(1,226
)
 
(1,226
)
 
–
   
–
 
Deferred compensation plan liabilities for non- employee directors
 
(899
)
 
(899
)
 
–
   
–
 
Derivative financial instruments, net
 
(550
)
 
–
   
(550
)
 
–
 
 
As of August 1, 2009:
Cash equivalents – money market funds
$
14,500
 
$
14,500
 
$
–
 
$
–
 
Non-qualified deferred compensation plan assets
 
788
   
788
   
–
   
–
 
Non-qualified deferred compensation plan  liabilities
 
(788
)
 
(788
)
 
–
   
–
 
Deferred compensation plan liabilities for non- employee directors
 
(467
)
 
(467
)
 
–
   
–
 
Derivative financial instruments, net
 
(1,042
)
 
–
   
(1,042
)
 
–
 
                         
As of January 30, 2010:
Cash equivalents – money market funds
$
25,000
 
$
25,000
 
$
–
 
$
–
 
Non-qualified deferred compensation plan assets
 
1,033
   
1,033
   
–
   
–
 
Non-qualified deferred compensation plan  liabilities
 
(1,033
)
 
(1,033
)
 
–
   
–
 
Deferred compensation plan liabilities for non- employee directors
 
(747
)
 
(747
)
 
–
   
–
 
Derivative financial instruments, net
 
(601
)
 
–
   
(601
)
 
–
 
                         

Store Impairment Charges
The Company assesses the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors the Company considers important that could trigger an impairment review include underperformance relative to expected historical or projected future operating results, a significant change in the manner of the use of the asset or a negative industry or economic trend. When the Company determines that the carrying value of long-lived assets may not be recoverable based upon the existence of one or more of the aforementioned factors, impairment is measured based on a projected discounted cash flow method. Certain factors, such as estimated store sales and expenses, used for this nonrecurring fair value measurement are considered Level 3 inputs. Long-lived store assets held and used with a carrying amount of $52.3 million were written down to their fair value, resulting in an impairment charge of $0.5 million, which was recorded within selling and administrative expenses for the thirteen weeks ended July 31, 2010. Of the $0.5 million impairment charge, $0.4 million related to the Famous Footwear segment and $0.1 million related to the Specialty Retail segment. Impairment charges of $1.7 million were recorded within selling and administrative expenses for the twenty-six weeks ended July 31, 2010, of which $1.2 million related to the Famous Footwear segment and $0.5 million related to the Specialty Retail segment.

Fair Value of the Company’s Other Financial Instruments
The fair values of cash and cash equivalents (excluding money market funds discussed above), receivables and trade accounts payable approximate their carrying values due to the short-term nature of these instruments.
 
20
 
The carrying amounts and fair values of the Company’s other financial instruments subject to fair value disclosures are as follows:
           
 
July 31, 2010
 
August 1, 2009
 
January 30, 2010
($ thousands)
Carrying
Amount
 
Fair
Value
 
Carrying Amount
 
Fair
Value
 
Carrying
Amount
 
Fair
Value
 
Borrowings under revolving credit agreement
$
35,500
 
 $
35,500
$
47,500
$
47,500
 
$
94,500
 
 $
94,500
 
Senior Notes
 
150,000
   
151,688
 
150,000
 
143,813
   
150,000
   
152,250
 

The fair value of borrowings under the revolving credit agreement approximated their carrying value due to the short-term nature and the fair value of the Company’s Senior Notes was based upon quoted prices as of the end of the respective periods.
 
 
Note 14
Related Party Transactions

Hongguo International Holdings
The Company entered into a joint venture agreement with a subsidiary of Hongguo International Holdings Limited (“Hongguo”) to begin marketing Naturalizer footwear in China in 2007. The Company is a 51% owner of the joint venture (“B&H Footwear”), with Hongguo owning the other 49%. B&H Footwear began operations in 2007 and distributes the Naturalizer brand in department store shops and free-standing stores in several of China’s largest cities. In addition, B&H Footwear sells Naturalizer footwear to Hongguo on a wholesale basis. Hongguo then sells Naturalizer products through retail stores in China. During the thirteen weeks and twenty-six weeks ended July 31, 2010, the Company, through its consolidated subsidiary, B&H Footwear, sold $0.5 million and $1.1 million of Naturalizer footwear on a wholesale basis to Hongguo, with $0.3 million and $0.8 million in corresponding sales during the thirteen weeks and twenty-six weeks ended August 1, 2009, respectively.


Note 15
Commitments and Contingencies

Environmental Remediation
While the Company currently does not operate manufacturing facilities, prior operations included numerous manufacturing and other facilities for which the Company may have responsibility under various environmental laws for the remediation of conditions that may be identified in the future. The Company is involved in environmental remediation and ongoing compliance activities at several sites and has been notified that it is or may be a potentially responsible party at several other sites.

Redfield
The Company is remediating, under the oversight of Colorado authorities, the groundwater and indoor air at its owned facility in Colorado (the “Redfield site” or, when referring to remediation activities at or under the facility, the “on-site remediation”) and residential neighborhoods adjacent to and near the property (the “off-site remediation”) that have been affected by solvents previously used at the facility. The on-site remediation calls for the operation of a pump and treat system (which prevents migration of contaminated groundwater off the property) as the final remedy for the site, subject to monitoring and periodic review of the on-site conditions and other remedial technologies that may be developed in the future. Off-site groundwater concentrations have been reducing over time, since installation of the pump and treat system in 2000 and injection of clean water beginning in 2003. However, localized areas of contaminated bedrock just beyond the property line continue to impact off-site groundwater. The modified workplan for addressing this condition includes converting the off-site bioremediation system into a monitoring well network and employing different remediation methods in these recalcitrant areas. In accordance with the workplan, a pilot test was conducted of certain groundwater remediation methods and the results of that test were used to develop more detailed plans for remedial activities in the off-site areas, which were approved by the authorities and are being implemented in a phased manner. The results of groundwater monitoring will be used to evaluate the effectiveness of these activities. The liability for the on-site remediation was discounted at 4.8%. On an undiscounted basis, the on-site remediation liability would be $16.5 million as of July 31, 2010. The Company expects to spend approximately $0.2 million in each of the next five years and $15.5 million in the aggregate thereafter related to the on-site remediation.
 
21
 
The cumulative expenditures for both on-site and off-site remediation through July 31, 2010 are $22.7 million. The Company has recovered a portion of these expenditures from insurers and other third parties. The reserve for the anticipated future remediation activities at July 31, 2010, is $7.8 million, of which $1.2 million is recorded within other accrued expenses and $6.6 million is recorded within other liabilities. Of the total $7.8 million reserve, $5.0 million is for on-site remediation and $2.8 million is for off-site remediation. During the thirteen weeks and twenty-six weeks ended July 31, 2010 and August 1, 2009, the Company recorded no expense related to either the on-site or off-site remediation, other than the accretion of interest expense.

Other
The Company has completed its remediation efforts at its closed New York tannery and two associated landfills. In 1995, state environmental authorities reclassified the status of these sites as being properly closed and requiring only continued maintenance and monitoring through 2024. The Company has an accrued liability of $1.8 million at July 31, 2010, related to these sites, which has been discounted at 6.4%. On an undiscounted basis, this liability would be $2.6 million. The Company expects to spend approximately $0.2 million in each of the next five years and $1.6 million in the aggregate thereafter related to these sites. In addition, various federal and state authorities have identified the Company as a potentially responsible party for remediation at certain other sites. However, the Company does not currently believe that its liability for such sites, if any, would be material.

Based on information currently available, the Company has an accrued liability of $9.6 million as of July 31, 2010, to complete the cleanup, maintenance and monitoring at all sites. Of the $9.6 million liability, $1.4 million is recorded in other accrued expenses and $8.2 million is recorded in other liabilities. The Company continues to evaluate its estimated costs in conjunction with its environmental consultants and records its best estimate of such liabilities. However, future actions and the associated costs are subject to oversight and approval of various governmental authorities. Accordingly, the ultimate costs may vary, and it is possible costs may exceed the recorded amounts.

Litigation
On April 25, 2008, the Board of Commissioners of the County of La Plata, Colorado, filed suit against a subsidiary of the Company in the United States District Court for the District of Colorado, alleging soil and groundwater contamination associated with a former facility located in Durango, Colorado. The Redfield rifle scope business operated a lens crafting facility on this property, which was subsequently sold to the County. The County seeks reimbursement for its past expenditures and a judgment obligating the Company to pay for cleanup of the site. The trial date is set for October 2010.

The Company is involved in legal proceedings and litigation arising in the ordinary course of business. In the opinion of management, the outcome of such ordinary course of business proceedings and litigation currently pending will not have a material adverse effect on the Company’s results of operations or financial position. All legal costs associated with litigation are expensed as incurred.

Other
In 2004, the Company was notified of the insolvency of an insurance company that insured the Company for workers’ compensation and casualty losses from 1973 to 1989. That company is now in liquidation. Certain claims from that time period are still outstanding, for which the Company has an accrued liability of $1.7 million as of July 31, 2010. While management believes it has an appropriate reserve for this matter, the ultimate outcome and cost to the Company may vary.

At July 31, 2010, the Company was contingently liable for remaining lease commitments of approximately $1.4 million in the aggregate, which relate to former retail locations that it exited in prior years. These obligations will continue to decline over the next several years as leases expire. In order for the Company to incur any liability related to these lease commitments, the current lessees would have to default.

 
22
 
 
Note 16
Financial Information for the Company and its Subsidiaries

In 2005, Brown Shoe Company, Inc. issued Senior Notes, which are fully and unconditionally and jointly and severally guaranteed by all of its existing and future subsidiaries that are guarantors under its existing Credit Agreement. The following table presents the condensed consolidating financial information for each of Brown Shoe Company, Inc. (“Parent”), the Guarantors and subsidiaries of the Parent that are not Guarantors (the “Non-Guarantors”), together with consolidating eliminations, as of and for the periods indicated.

The condensed consolidating financial statements have been prepared using the equity method of accounting in accordance with the requirements for presentation of such information. Management believes that the information, presented in lieu of complete financial statements for each of the Guarantors, provides meaningful information to allow investors to determine the nature of the assets held by, and operations and cash flows of, each of the consolidated groups.

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF JULY 31, 2010

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Assets
                             
Current assets
                             
Cash and cash equivalents
$
(2,745
)
$
14,714
 
$
18,755
 
$
–
 
$
30,724
 
Receivables
 
78,242
   
3,183
   
24,724
   
–
   
106,149
 
Inventories
 
105,623
   
470,020
   
2,442
   
–
   
578,085
 
Prepaid expenses and other current assets
 
26,221
   
6,891
   
94
   
–
   
33,206
 
Total current assets
 
207,341
   
494,808
   
46,015
   
–
   
748,164
 
Other assets
 
96,235
   
21,973
   
676
   
–
   
118,884
 
Intangible assets, net
 
56,036
   
17,840
   
–
   
–
   
73,876
 
Property and equipment, net
 
25,242
   
107,683
   
3,282
   
–
   
136,207
 
Investment in subsidiaries
 
675,269
   
81,980
   
–
   
(757,249
)
 
–
 
Total assets
$
1,060,123
 
$
724,284
 
$
49,973
 
$
(757,249
)
$
1,077,131
 
                               
Liabilities and Equity
                         
Current liabilities
                             
Borrowings under revolving credit agreement
$
35,500
 
$
–
 
$
–
 
$
–
 
$
35,500
 
Trade accounts payable
 
73,720
   
192,380
   
28,745
   
–
   
294,845
 
Other accrued expenses
 
74,225
   
59,768
   
5,682
   
–
   
139,675
 
Total current liabilities
 
183,445
   
252,148
   
34,427
   
–
   
470,020
 
Other liabilities
                             
Long-term debt
 
150,000
   
–
   
–
   
–
   
150,000
 
Other liabilities
 
26,660
   
38,632
   
274
   
–
   
65,566
 
Intercompany payable (receivable)
 
308,947
   
(241,765
)
 
(67,182
)
 
–
   
–
 
Total other liabilities
 
485,607
   
(203,133
)
 
(66,908
)
 
–
   
215,566
 
Equity
                   
–
       
     Brown Shoe Company, Inc. shareholders’ equity
 
391,071
   
675,269
   
81,980
   
(757,249
)
 
391,071
 
     Noncontrolling interests
 
–
   
–
   
474
   
–
   
474
 
Total equity
 
391,071
   
675,269
   
82,454
   
(757,249
)
 
391,545
 
Total liabilities and equity
$
1,060,123
 
$
724,284
 
$
49,973
 
$
(757,249
)
$
1,077,131
 

 
23
 

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE THIRTEEN WEEKS ENDED JULY 31, 2010

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net sales
$
169,710
 
$
411,080
 
$
55,733
 
$
(50,767
)
$
585,756
 
Cost of goods sold
 
129,810
   
221,340
   
46,903
   
(50,767
)
 
347,286
 
Gross profit
 
39,900
   
189,740
   
8,830
   
–
   
238,470
 
Selling and administrative expenses
 
45,227
   
177,946
   
1,275
   
–
   
224,448
 
Restructuring and other special charges, net
 
1,730
   
–
   
161
   
–
   
1,891
 
Equity in (earnings) loss of subsidiaries
 
(12,251
)
 
(2,480
)
 
–
   
14,731
   
–
 
Operating earnings (loss)
 
5,194
   
14,274
   
7,394
   
(14,731
)
 
12,131
 
Interest expense
 
(4,809
)
 
(1
)
 
–
   
–
   
(4,810
)
Interest income
 
–
   
28
   
21
   
–
   
49
 
Intercompany interest income (expense)
 
3,459
   
581
   
(4,040
)
 
–
   
–
 
Earnings (loss) before income taxes
 
3,844
   
14,882
   
3,375
   
(14,731
)
 
7,370
 
Income tax benefit (provision)
 
1,417
   
(3,028
)
 
(971
)
 
–
   
(2,582
)
Net earnings (loss)
$
5,261
 
$
11,854
 
$
2,404
 
$
(14,731
)
$
4,788
 
Less: Net loss attributable to noncontrolling  interests
 
–
   
(397
)
 
(76
)
 
–
   
(473
)
Net earnings (loss) attributable to Brown Shoe  Company, Inc.
$
5,261
 
$
12,251
 
$
2,480
 
$
(14,731
)
$
5,261
 


CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE TWENTY-SIX WEEKS ENDED JULY 31, 2010

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net sales
$
333,064
 
$
837,956
 
$
100,774
 
$
(88,320
)
$
1,183,474
 
Cost of goods sold
 
247,492
   
453,473
   
84,799
   
(88,320
)
 
697,444
 
Gross profit
 
85,572
   
384,483
   
15,975
   
–
   
486,030
 
Selling and administrative expenses
 
96,031
   
346,409
   
6,523
   
–
   
448,963
 
Restructuring and other special charges, net
 
3,273
   
–
   
335
   
–
   
3,608
 
Equity in (earnings) loss of subsidiaries
 
(26,253
)
 
(4,196
)
 
–
   
30,449
   
–
 
Operating earnings (loss)
 
12,521
   
42,270
   
9,117
   
(30,449
)
 
33,459
 
Interest expense
 
(9,318
)
 
(4
)
 
–
   
–
   
(9,322
)
Interest income
 
1
   
29
   
37
   
–
   
67
 
Intercompany interest income (expense)
 
7,076
   
(3,416
)
 
(3,660
)
 
–
   
–
 
Earnings (loss) before income taxes
 
10,280
   
38,879
   
5,494
   
(30,449
)
 
24,204
 
Income tax benefit (provision)
 
5,027
   
(12,316
)
 
(1,592
)
 
–
   
(8,881
)
Net earnings (loss)
$
15,307
 
$
26,563
 
$
3,902
 
$
(30,449
)
$
15,323
 
Less: Net earnings (loss) attributable to noncontrolling  interests
 
–
   
310
   
(294
)
 
–
   
16
 
Net earnings (loss) attributable to Brown Shoe  Company, Inc.
$
15,307
 
$
26,253
 
$
4,196
 
$
(30,449
)
$
15,307
 
 
 
24
 
 
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE TWENTY-SIX WEEKS ENDED JULY 31, 2010

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net cash (used for) provided by operating activities
$
(26,863
)
$
44,036
 
$
9,816
 
$
–
 
$
26,989
 
                               
Investing activities
                             
Purchases of property and equipment
 
(1,978
)
 
(10,664
)
 
(202
)
 
–
   
(12,844
)
Capitalized software
 
(11,734
)
 
(137
)
 
–
   
–
   
(11,871
)
Net cash used for investing activities
 
(13,712
)
 
(10,801
)
 
(202
)
 
–
   
(24,715
)
                               
Financing activities
                             
Borrowings under revolving credit agreement
 
435,500
   
–
   
–
   
–
   
435,500
 
Repayments under revolving credit agreement
 
(494,500
)
 
–
   
–
   
–
   
(494,500
)
Intercompany financing
 
95,216
   
12,205
   
(107,421
)
 
–
   
–
 
Acquisition of noncontrolling interests (Edelman  Shoe, Inc.)
 
7,309
   
(40,001
)
 
–
   
–
   
(32,692
)
Dividends paid
 
(6,114
)
 
–
   
–
   
–
   
(6,114
)
Proceeds from stock options exercised
 
561
   
–
   
–
   
–
   
561
 
Tax deficiency related to share-based plans
 
(142
)
 
–
   
–
   
–
   
(142
)
Net cash provided by (used for) financing activities
 
37,830
   
(27,796
)
 
(107,421
)
 
–
   
(97,387
)
Effect of exchange rate changes on cash
 
–
   
4
   
–
   
–
   
4
 
                     
 
       
(Decrease) increase in cash and cash equivalents
 
(2,745
)
 
5,443
   
(97,807
)
 
–
   
(95,109
)
Cash and cash equivalents at beginning of period
 
–
   
9,271
   
116,562
   
–
   
125,833
 
Cash and cash equivalents at end of period
$
(2,745
)
$
14,714
 
$
18,755
 
$
–
 
$
30,724
 


 
25
 
 
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF JANUARY 30, 2010

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Assets
                             
Current assets
                             
Cash and cash equivalents
$
–
 
$
2,809
 
$
123,024
 
$
–
 
$
125,833
 
Receivables
 
51,417
   
3,002
   
29,878
   
–
   
84,297
 
Inventories
 
77,730
   
376,110
   
2,842
   
–
   
456,682
 
Prepaid expenses and other current assets
 
26,751
   
12,327
   
2,359
   
–
   
41,437
 
Total current assets
 
155,898
   
394,248
   
158,103
   
–
   
708,249
 
Other assets
 
92,413
   
(1,189
)
 
21,890
   
–
   
113,114
 
Intangible assets, net
 
58,826
   
3,000
   
15,400
   
–
   
77,226
 
Property and equipment, net
 
25,140
   
112,580
   
3,841
   
–
   
141,561
 
Investment in subsidiaries
 
641,409
   
199,234
   
–
   
(840,643
)
 
–
 
Total assets
$
973,686
 
$
707,873
 
$
199,234
 
$
(840,643
)
$
1,040,150
 
                               
Liabilities and Equity
                         
Current liabilities
                             
Borrowings under revolving credit agreement
$
94,500
 
$
–
 
$
–
 
$
–
 
$
94,500
 
Trade accounts payable
 
53,410
   
93,937
   
30,353
   
–
   
177,700
 
Other accrued expenses
 
78,504
   
55,685
   
7,674
   
–
   
141,863
 
Total current liabilities
 
226,414
   
149,622
   
38,027
   
–
   
414,063
 
Other liabilities
                             
Long-term debt
 
150,000
   
–
   
–
   
–
   
150,000
 
Other liabilities
 
19,455
   
39,386
   
6,019
   
–
   
64,860
 
Intercompany payable (receivable)
 
210,439
   
(261,042
)
 
50,603
   
–
   
–
 
Total other liabilities
 
379,894
   
(221,656
)
 
56,622
   
–
   
214,860
 
Equity
                             
     Brown Shoe Company, Inc. shareholders’ equity
 
367,378
   
779,907
   
95,529
   
(840,643
)
 
402,171
 
     Noncontrolling interests
 
–
   
–
   
9,056
   
–
   
9,056
 
Total equity
 
367,378
   
779,907
   
104,585
   
(840,643
)
 
411,227
 
Total liabilities and equity
$
973,686
 
$
707,873
 
$
199,234
 
$
(840,643
)
$
1,040,150
 

 
26
 

CONDENSED CONSOLIDATING BALANCE SHEET
AS OF AUGUST 1, 2009

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Assets
                             
Current assets
                             
Cash and cash equivalents
$
–
 
$
7,428
 
$
29,846
 
$
–
 
$
37,274
 
Receivables
 
46,328
   
3,584
   
22,244
   
–
   
72,156
 
Inventories
 
79,319
   
443,301
   
4,188
   
–
   
526,808
 
Prepaid expenses and other current assets
 
26,705
   
12,725
   
2,447
   
–
   
41,877
 
Total current assets
 
152,352
   
467,038
   
58,725
   
–
   
678,115
 
Other assets
 
80,504
   
15,394
   
14,642
   
–
   
110,540
 
Intangible assets, net
 
61,653
   
3,000
   
15,960
   
–
   
80,613
 
Property and equipment, net
 
26,474
   
125,333
   
3,743
   
–
   
155,550
 
Investment in subsidiaries
 
651,310
   
79,239
   
–
   
(730,549
)
 
–
 
Total assets
$
972,293
 
$
690,004
 
$
93,070
 
$
(730,549
)
$
1,024,818
 
                               
Liabilities and Equity
                         
Current liabilities
                             
Borrowings under revolving credit agreement
$
47,500
 
$
–
 
$
–
 
$
–
 
$
47,500
 
Trade accounts payable
 
36,021
   
176,029
   
21,741
   
–
   
233,791
 
Other accrued expenses
 
65,897
   
61,338
   
6,417
   
–
   
133,652
 
Total current liabilities
 
149,418
   
237,367
   
28,158
   
–
   
414,943
 
Other liabilities
                             
Long-term debt
 
150,000
   
–
   
–
   
–
   
150,000
 
Other liabilities
 
23,156
   
42,223
   
6,240
   
–
   
71,619
 
Intercompany payable (receivable)
 
270,136
   
(240,896
)
 
(29,240
)
 
–
   
–
 
Total other liabilities
 
443,292
   
(198,673
)
 
(23,000
)
 
–
   
221,619
 
Equity
                             
     Brown Shoe Company, Inc. shareholders’ equity
 
379,583
   
651,310
   
79,239
   
(730,549
)
 
379,583
 
     Noncontrolling interests
 
–
   
–
   
8,673
   
–
   
8,673
 
Total equity
 
379,583
   
651,310
   
87,912
   
(730,549
)
 
388,256
 
Total liabilities and equity
$
972,293
 
$
690,004
 
$
93,070
 
$
(730,549
)
$
1,024,818
 
 
CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE THIRTEEN WEEKS ENDED AUGUST 1, 2009

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net sales
$
124,904
 
$
373,829
 
$
68,472
 
$
(55,584
)
$
511,621
 
Cost of goods sold
 
99,215
   
211,318
   
53,032
   
(55,584
)
 
307,981
 
Gross profit
 
25,689
   
162,511
   
15,440
   
–
   
203,640
 
Selling and administrative expenses
 
33,264
   
167,084
   
6,272
   
–
   
206,620
 
Restructuring and other special charges, net
 
1,998
   
–
   
–
   
–
   
1,998
 
Equity in (earnings) loss of subsidiaries
 
(4,414
)
 
(8,296
)
 
–
   
12,710
   
–
 
Operating (loss) earnings
 
(5,159
)
 
3,723
   
9,168
   
(12,710
)
 
(4,978
)
Interest expense
 
(4,758
)
 
–
   
(156
)
 
–
   
(4,914
)
Interest income
 
–
   
4
   
141
   
–
   
145
 
Intercompany interest income (expense)
 
1,384
   
(1,689
)
 
305
   
–
   
–
 
(Loss) earnings before income taxes
 
(8,533
)
 
2,038
   
9,458
   
(12,710
)
 
(9,747
)
Income tax benefit (provision)
 
4,288
   
2,376
   
(1,133
)
 
–
   
5,531
 
Net (loss) earnings
$
(4,245
)
$
4,414
 
$
8,325
 
$
(12,710
)
$
(4,216
)
Less: Net earnings attributable to noncontrolling  interests
 
–
   
–
   
29
   
–
   
29
 
Net (loss) earnings attributable to Brown Shoe  Company, Inc.
$
(4,245
)
$
4,414
 
$
8,296
 
$
(12,710
)
$
(4,245
)
 
 
27
 

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS
FOR THE TWENTY-SIX WEEKS ENDED AUGUST 1, 2009

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net sales
$
272,040
 
$
747,230
 
$
129,494
 
$
(98,403
)
$
1,050,361
 
Cost of goods sold
 
212,788
   
422,583
   
101,589
   
(98,403
)
 
638,557
 
Gross profit
 
59,252
   
324,647
   
27,905
   
–
   
411,804
 
Selling and administrative expenses
 
70,465
   
333,236
   
15,636
   
–
   
419,337
 
Restructuring and other special charges, net
 
4,612
   
–
   
–
   
–
   
4,612
 
Equity in (earnings) loss of subsidiaries
 
(3,505
)
 
(11,095
)
 
–
   
14,600
   
–
 
Operating (loss) earnings
 
(12,320
)
 
2,506
   
12,269
   
(14,600
)
 
(12,145
)
Interest expense
 
(10,003
)
 
(1
)
 
(159
)
 
–
   
(10,163
)
Interest income
 
1
   
31
   
256
   
–
   
288
 
Intercompany interest income (expense)
 
2,893
   
(3,433
)
 
540
   
–
   
–
 
(Loss) earnings before income taxes
 
(19,429
)
 
(897
)
 
12,906
   
(14,600
)
 
(22,020
)
Income tax benefit (provision)
 
7,581
   
4,402
   
(1,250
)
 
–
   
10,733
 
Net (loss) earnings
$
(11,848
)
$
3,505
 
$
11,656
 
$
(14,600
)
$
(11,287
)
Less: Net earnings attributable to noncontrolling  interests
 
–
   
–
   
561
   
–
   
561
 
Net (loss) earnings attributable to Brown Shoe  Company, Inc.
$
(11,848
)
$
3,505
 
$
11,095
 
$
(14,600
)
$
(11,848
)


CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE TWENTY-SIX WEEKS ENDED AUGUST 1, 2009

($ thousands)
Parent
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Total
 
Net cash provided by operating activities
$
12,231
 
$
14,475
 
$
23,005
 
$
–
 
$
49,711
 
                               
Investing activities
                             
Purchases of property and equipment
 
(1,133
)
 
(16,286
)
 
(492
)
 
–
   
(17,911
)
Capitalized software
 
(10,307
)
 
(582
)
 
(27
)
 
–
   
(10,916
)
Net cash used for investing activities
 
(11,440
)
 
(16,868
)
 
(519
)
 
–
   
(28,827
)
                               
Financing activities
                             
Borrowings under revolving credit agreement
 
394,900
   
–
   
–
   
–
   
394,900
 
Repayments under revolving credit agreement
 
(459,900
)
 
–
   
–
   
–
   
(459,900
)
Tax deficiency related to share-based plans
 
(89
)
 
–
   
–
   
–
   
(89
)
Dividends paid
 
(6,006
)
 
–
   
–
   
–
   
(6,006
)
Intercompany financing
 
70,304
   
(13,598
)
 
(56,706
)
 
–
   
–
 
Net cash used for financing activities
 
(791
)
 
(13,598
)
 
(56,706
)
 
–
   
(71,095
)
Effect of exchange rate changes on cash
 
–
   
585
   
–
   
–
   
585
 
                               
Decrease in cash and cash equivalents
 
–
   
(15,406
)
 
(34,220
)
 
–
   
(49,626
)
Cash and cash equivalents at beginning of period
 
–
   
22,834
   
64,066
   
–
   
86,900
 
Cash and cash equivalents at end of period
$
–
 
$
7,428
 
$
29,846
 
$
–
 
$
37,274
 

 
28
 

ITEM 2
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW
 

We delivered another quarter of solid financial performance in 2010. Our retail and wholesale businesses continue to gain momentum as we head into the key back-to-school season, as evidenced by the same-store sales increase at our retail stores and growth in our wholesale brands resulting from the execution of strong merchandising and marketing plans. Additionally, we have made inventory investments to capitalize on trend-right product offerings, which we believe position us to compete more effectively during this peak shopping period.

The following is a summary of the financial highlights for the second quarter of 2010:

·  
Consolidated net sales increased $74.2 million, or 14.5%, to $585.8 million for the second quarter of 2010, compared to $511.6 million for the second quarter of last year. Net sales of our Wholesale Operations, Famous Footwear and Specialty Retail segments increased by $36.6 million, $33.2 million and $4.3 million, respectively.

·  
Consolidated operating earnings were $12.1 million in the second quarter of 2010, compared to a consolidated operating loss of $5.0 million for the second quarter of last year.

·  
Consolidated net earnings attributable to Brown Shoe Company, Inc. were $5.3 million, or $0.12 per diluted share, in the second quarter of 2010, compared to our consolidated net loss attributable to Brown Shoe Company, Inc. of $4.2 million, or $0.10 per diluted share, in the second quarter of last year.

The following items impacted our second quarter operating results in 2010 and 2009 and should be considered in evaluating the comparability of our results:

·   
Marketing initiatives – Marketing expenses were $5.8 million ($3.6 million on an after-tax basis, or $0.08 per diluted share) higher in the second quarter of 2010, compared to the second quarter of last year, due to our continued focus on driving brand awareness across our retail and wholesale businesses and deepening our connection with customers.
 
·   
Incentive plans – Due to our stronger financial performance in the second quarter of 2010 relative to the second quarter of last year, as well as expectations for the full year of 2010, expenses related to our cash- and share-based incentive plans were $4.3 million ($2.6 million on an after-tax basis, or $0.06 per diluted share) higher in the second quarter of 2010.
 
·   
Information technology initiatives – We incurred expenses of $1.9 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) during the second quarter of 2010, related to our integrated enterprise resource planning (“ERP”) information technology system that is replacing select existing internally developed and certain other third-party applications, with $2.0 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) in corresponding expenses during the second quarter of last year. See the Recent Developments section that follows and Note 6 to the condensed consolidated financial statements for additional information related to these expenses.

Following is a summary of our operating results in the second quarter of 2010 by segment and the status of our balance sheet. See Note 7 to the condensed consolidated financial statements for additional information regarding our business segments.

·  
Our Famous Footwear segment’s net sales increased 10.6% to $347.3 million for the second quarter of 2010, compared to $314.1 million for the second quarter of last year. Same-store sales increased 11.8% during the second quarter of 2010, reflecting a higher conversion rate in our stores, higher average retail prices and increases in customer traffic levels. The improvement in operating results was broad-based with all major categories, channels and geographic regions contributing to Famous Footwear’s second quarter operating results. A lower store count, as a result of store closings, partially offset the same-store sales increase. Operating earnings increased $16.6 million to $15.8 million for the second quarter of 2010, as compared to an operating loss of $0.8 million for the second quarter of last year, driven primarily by higher net sales and gross profit rate, partially offset by higher selling and merchandising expenses. As a percent of net sales, operating earnings increased to 4.5% in the second quarter of 2010, compared to an operating loss of 0.3% in the second quarter of last year.

 
29
 


·   
Our Wholesale Operations segment’s net sales increased 25.8% to $178.6 million for the second quarter of 2010, compared to $142.0 million for the second quarter of last year. Sales growth was led by our Dr. Scholl’s, Sam Edelman, Vera Wang Lavender and Via Spiga divisions. The increased mix of our wholesale brands sold to third parties as well as shifts in channel and brand mix and increased air freight costs led to a lower gross profit rate. Operating earnings increased $1.1 million, or 14.5%, to $9.0 million for the second quarter of 2010, compared to $7.9 million for the second quarter of last year, as a result of the increase in net sales, partially offset by the decrease in gross profit rate and increase in selling and administrative expenses. As a percent of net sales, operating earnings declined to 5.1% for the second quarter of 2010, compared to 5.5% for the second quarter of last year.

·   
Our Specialty Retail segment’s net sales increased 7.8% to $59.8 million for the second quarter of 2010, compared to $55.5 million for the second quarter of last year. A same-store sales increase of 6.8% in our retail stores, higher net sales at Shoes.com and an increase in the Canadian dollar exchange rate led to an overall increase in our level of net sales. A lower store count, as a result of store closings, partially offset the net sales increases. We incurred an operating loss of $2.7 million for the second quarter of 2010, compared to an operating loss of $4.3 million for the second quarter of last year.

Our debt-to-capital ratio, the ratio of our debt obligations to the sum of our debt obligations and equity, decreased to 32.1% at July 31, 2010, compared to 33.7% at August 1, 2009, primarily due to the $12.0 million decline in borrowings under our revolving credit agreement. Our debt-to-capital ratio decreased from 37.3% at January 30, 2010 primarily due to the $59.0 million decline in borrowings under our revolving credit agreement. Our current ratio, the relationship of current assets to current liabilities, was 1.59 to 1 at July 31, 2010, compared to 1.63 to 1 at August 1, 2009 and 1.71 to 1 at January 30, 2010. Inventories at July 31, 2010 were $578.1 million, up from $526.8 million at the end of the second quarter of last year, primarily in our Famous Footwear and Wholesale Operations segments, in support of higher sales levels, including our investments in wellness initiatives and accessories, and in order to be well positioned for the back-to-school season.

Recent Developments

Additional Investment in Edelman Shoe, Inc.
On June 4, 2010, we acquired the remaining 50% of our noncontrolling interest in Edelman Shoe for $40.0 million, consisting of a combination of $32.7 million of cash, including transaction fees, and $7.3 million in shares of our common stock. Edelman Shoe is a leading designer and marketer of fashion footwear. The Sam Edelman brand was launched in 2004 and is primarily sold through department stores and independent retailers. We believe the acquisition is critical to the execution of our contemporary fashion strategy, which includes providing consumers access to fashion primarily in the bridge/designer footwear price zones. See Note 3 to the condensed consolidated financial statements for additional information regarding our interests in Edelman Shoe during the first half of 2010.

Information Technology Initiatives
During 2008, we began implementation of an integrated ERP information technology system provided by third-party vendors. The ERP information technology system is replacing select existing internally developed and certain other third-party applications, and is expected to support our business model. We expect the implementation will enhance our profitability through improved management and execution of our business operations, financial systems, supply chain efficiency and planning and employee productivity. The phased implementation began during 2008 and is expected to be substantially complete in the fourth quarter of 2010. We incurred expenses of $1.9 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) and $3.6 million ($2.4 million on an after-tax basis, or $0.06 per diluted share) during the second quarter and first half of 2010, respectively, as a component of restructuring and other special charges, net related to these initiatives.  We incurred expenses of $2.0 million ($1.3 million on an after-tax basis, or $0.03 per diluted share) and $4.6 million ($3.0 million on an after-tax basis, or $0.07 per diluted share) during the second quarter and first half of 2009, respectively, as a component of restructuring and other special charges, net related to these initiatives.

Outlook for the Remainder of 2010
We believe our brands are well positioned in the marketplace and our investments will enable us to further capitalize on the consumers’ desire for trend-right products. We have seen positive trends continue into the third quarter of 2010, and while there remains uncertainty as to the pace of the broader economic recovery, we continue to believe that we will see solid sales growth for the Company in 2010. We expect the same-store sales of our retail businesses to grow in the high single- to low-double digit percentage range in 2010. For our wholesale business, we expect a net sales increase in 2010 in the high-teens percentage range as compared to 2009. We plan to continue increasing our investment in marketing and sharpening our focus on the consumer throughout the remainder of 2010.

 
30
 
Following are the consolidated results and the results by segment for the thirteen weeks and twenty-six weeks ended July 31, 2010 and August 1, 2009:

CONSOLIDATED RESULTS
 

 
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
July 31, 2010
 
August 1, 2009
 
July 31, 2010
 
August 1, 2009
($ millions)
   
  % of
Net
Sales
       
    % of
Net
Sales
     
    % of
Net
Sales
     
% of
Net
 Sales
Net sales
$
585.8
 
100.0%
 
$
511.6
 
100.0%
 
$
1,183.5
 
100.0%
 
$
1,050.4
 
100.0%
Cost of goods sold
 
347.3
 
59.3%
   
308.0
 
60.2%
   
697.5
 
58.9%
   
638.6
 
60.8%
Gross profit
 
238.5
 
40.7%
   
203.6
 
39.8%
   
486.0
 
41.1%
   
411.8
 
39.2%
Selling and administrative expenses
 
224.5
 
38.3%
   
206.6
 
40.4%
   
448.9
 
38.0%
   
419.3
 
40.0%
Restructuring and other special charges, net
 
1.9
 
0.3%
   
2.0
 
0.4%
   
3.6
 
0.3%
   
4.6
 
0.4%
Operating earnings (loss)
 
12.1
 
2.1%
   
(5.0
)
(1.0)%
   
33.5
 
2.8%
   
(12.1
)
(1.2)%
Interest expense
 
(4.7
)
(0.8)%
   
(4.9
)
(0.9)%
   
(9.4
)
(0.8)%
   
(10.2
)
(0.9)%
Interest income
 
–
 
–
   
0.2
 
0.0%
   
0.1
 
0.0%
   
0.3
 
0.0%
Earnings (loss) before income taxes
 
7.4
 
1.3%
   
(9.7
)
(1.9)%
   
24.2
 
2.0%
   
(22.0
)
(2.1)%
Income tax (provision) benefit
 
(2.6
)
(0.5)%
   
5.5
 
1.1%
   
(8.9
)
(0.7)%
   
10.7
 
1.0%
Net earnings (loss)
$
4.8
 
0.8%
 
$
(4.2
)
(0.8)%
 
$
15.3
 
1.3%
 
$
(11.3
)
(1.1)%
Less: Net (loss) earnings attributable to noncontrolling interests
 
(0.5
)
(0.1)%
   
–
 
–
   
–
 
–
   
0.5
 
0.0%
Net earnings (loss) attributable to Brown Shoe Company, Inc.
$
5.3
 
0.9%
 
$
(4.2
)
(0.8)%
 
$
15.3
 
1.3%
 
$
(11.8
)
(1.1)%

Net Sales
Net sales increased $74.2 million, or 14.5%, to $585.8 million for the second quarter of 2010, compared to $511.6 million for the second quarter of last year. All segments experienced an increase in net sales during the second quarter of 2010 as compared to the second quarter of 2009.  Our Wholesale Operations segment reported a $36.6 million increase in net sales, primarily as a result of strong demand and sales growth in many of our brands, led by our Dr. Scholl’s, Sam Edelman, Vera Wang Lavender and Via Spiga divisions. Our Famous Footwear segment reported a $33.2 million increase in net sales, reflecting an 11.8% same-store sales increase, resulting from a higher conversion rate in our stores, higher average retail prices and increases in customer traffic levels. The net sales of our Specialty Retail segment increased $4.3 million, primarily reflecting a 6.8% same-store sales increase in our retail stores and higher net sales at Shoes.com.

Net sales increased $133.1 million, or 12.7%, to $1,183.5 million for the first half of 2010, compared to $1,050.4 million for the first half of last year. All segments experienced an increase in net sales during the first half of 2010 as compared to the first half of 2009.  Our Famous Footwear segment reported a $77.8 million increase in net sales, reflecting a 13.6% same-store sales increase for the same reasons as those described above for the second quarter. Our Wholesale Operations segment reported a $42.5 million increase in net sales, primarily as a result of strong demand and sales growth in many of our brands, including primarily our Dr. Scholl’s, Sam Edelman, Vera Wang Lavender, Via Spiga and Naturalizer divisions. The net sales of our Specialty Retail segment increased $12.8 million, reflecting an 11.3% same-store sales increase in our retail stores, an increase in the Canadian dollar exchange rate and higher net sales at Shoes.com.

Same-store sales changes are calculated by comparing the sales in stores that have been open at least 13 months. This method avoids the distorting effect that grand opening sales have in the first month of operation. Relocated stores are treated as new stores, and closed stores are excluded from the calculation. Sales change from new and closed stores, net, reflects the change in net sales due to stores that have been opened or closed during the period and are thereby excluded from the same-store sales calculation.

 
31
 
Gross Profit
Gross profit increased $34.9 million, or 17.1%, to $238.5 million for the second quarter of 2010, compared to $203.6 million for the second quarter of last year, resulting from both higher net sales and a higher gross profit rate. As a percent of net sales, our gross profit increased to 40.7% for the second quarter of 2010 from 39.8% for the second quarter of last year. Our Famous Footwear segment contributed to the improvement in the gross profit rate, as the segment experienced strong sales of higher-margin categories, improved sell-through associated with its sharper focus on trend-right merchandise and a significant decrease in promotional activity during the quarter. The gross profit rate increase in our Famous Footwear segment was partially offset by a decline in the gross profit rate recognized by our Wholesale Operations segment resulting primarily from the increased mix of our wholesale brands sold to third parties as well as shifts in channel and brand mix and increased air freight costs.

Gross profit increased $74.2 million, or 18.0%, to $486.0 million for the first half of 2010, compared to $411.8 million in the first half of last year, due to both an increase in net sales and an increase in gross profit rate. As a percent of net sales, our gross profit was 41.1% in the first half of 2010, compared to 39.2% in the first half of last year. The primary driver in our improved gross profit rate was our Famous Footwear segment, as a result of strong sales of higher-margin categories and a significant decrease in promotional activity during the first half of 2010. Our Wholesale Operations segment contributed to the increase in gross profit rate as the segment experienced lower provisions for customer allowances and markdowns, resulting from improved sell-through rates at retail. In addition, our Specialty Retail segment also contributed to the increase in gross profit rate as the segment experienced improved retail sell-through resulting in lower markdowns for our retail stores.

We record warehousing, distribution, sourcing and other inventory procurement costs in selling and administrative expenses. Accordingly, our gross profit and selling and administrative expense rates, as a percentage of net sales, may not be comparable to other companies.

Selling and Administrative Expenses
Selling and administrative expenses increased $17.9 million, or 8.6%, to $224.5 million for the second quarter of 2010, compared to $206.6 million in the second quarter of last year. The increase was primarily related to increases associated with variable retail store and wholesale payroll expenses, increased marketing expenses and higher expected payments under our incentive plans.  As a percent of net sales, selling and administrative expenses decreased to 38.3% for the second quarter of 2010 from 40.4% for the second quarter of last year, reflecting the factors discussed above and better leveraging of our expense base over the higher sales volume.

Selling and administrative expenses increased $29.6 million, to $448.9 million for the first half of 2010, compared to $419.3 million in the first half of last year. We experienced higher direct selling costs, due to higher sales volume across all of our segments, higher expected payments under our incentive plans and increased marketing expenses. These increases were partially offset by a decline in our retail facilities expenses as a result of our lower store count and cost savings from initiatives implemented during 2009. As a percent of net sales, selling and administrative expenses decreased to 38.0% in the first half of 2010 from 40.0% in the first half of last year due primarily to better leveraging of our expense base over higher sales volume.

Restructuring and Other Special Charges, Net
We recorded restructuring and other special charges, net of $1.9 million for the second quarter of 2010, related to our integrated ERP information technology system that is replacing select existing internally developed and certain other third-party applications, with $2.0 million of corresponding charges during the second quarter of last year. As a percent of net sales, restructuring and other special charges, net decreased to 0.3% in the second quarter of 2010, from 0.4% in the second quarter of last year.

We recorded restructuring and other special charges, net of $3.6 million for the first half of 2010, related to our integrated ERP information technology system, with $4.6 million of corresponding charges during the first half of last year. As a percent of net sales, restructuring and other special charges, net decreased to 0.3% in the first half of 2010, from 0.4% in the first half of last year.

Operating Earnings (Loss)
We reported operating earnings of $12.1 million in the second quarter of 2010, compared to an operating loss of $5.0 million during the second quarter of last year, primarily driven by the increase in net sales and gross profit rate, partially offset by the increase in selling and administrative expenses, as described above.

 
32
 
We reported operating earnings of $33.5 million in the first half of 2010, compared to an operating loss of $12.1 million during the first half of last year, primarily driven by the increase in net sales and gross profit rate, partially offset by the increase in selling and administrative expenses, as described above.

Interest Expense
Interest expense decreased $0.2 million, or 2.1%, to $4.7 million for the second quarter of 2010, compared to $4.9 million for the second quarter of last year, primarily reflecting a lower interest rate on average borrowings under our revolving credit agreement.

Interest expense decreased $0.8 million, or 8.3%, to $9.4 million for the first half of 2010, compared to $10.2 million for the first half of last year, primarily reflecting lower average borrowings and lower interest rates on average borrowings under our revolving credit agreement.

Income Tax (Provision) Benefit
Our consolidated effective tax rate was a provision of 35.0% for the second quarter of 2010, compared to a benefit of 56.7% for the second quarter of last year, reflecting a change in the mix of domestic and foreign earnings and losses. Our domestic operations are generally subject to a normal combined tax rate of 35% to 39%, whereas our operations in foreign jurisdictions generally have lower tax rates.

Our consolidated effective tax rate was a provision of 36.7% in the first half of 2010, compared to a benefit of 48.7% in the first half of last year due to the same reasons as described above for the second quarter.

Net Earnings (Loss) Attributable to Brown Shoe Company, Inc.
We reported net earnings attributable to Brown Shoe Company, Inc. of $5.3 million and $15.3 million during the second quarter and first half of 2010, respectively, compared to a net loss attributable to Brown Shoe Company, Inc. of $4.2 million and $11.8 million during the second quarter and first half of last year, respectively, as a result of the factors described above.

 
33
 

 
FAMOUS FOOTWEAR
 

 
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
July 31, 2010
 
August 1, 2009
 
July 31, 2010
 
August 1, 2009
($ millions, except sales per square foot)
   
% of
Net
 Sales
       
% of
Net
 Sales
     
     % of
Net
Sales
     
% of
Net
 Sales
Operating Results
                                     
Net sales
$
347.3
 
100.0%
 
$
314.1
 
100.0%
 
$
709.5
 
100.0%
 
$
631.7
 
100.0%
Cost of goods sold
 
187.7
 
54.0%
   
179.8
 
57.2%
   
385.7
 
54.4%
   
360.9
 
57.1%
Gross profit
 
159.6
 
46.0%
   
134.3
 
42.8%
   
323.8
 
45.6%
   
270.8
 
42.9%
Selling and administrative expenses
 
143.8
 
41.5%
   
135.1
 
43.1%
   
279.9
 
39.4%
   
268.6
 
42.6%
Operating earnings (loss)
$
15.8
 
4.5%
 
$
(0.8
)
(0.3)%
 
$
43.9
 
6.2%
 
$
2.2
 
0.3%
                                       
Key Metrics
                                     
Same-store sales % change
 
11.8%
       
(6.7)%
       
13.6%
       
(5.9)%
   
Same-store sales $ change
$
35.8
     
$
(21.5
)
   
$
82.4
     
$
(36.9
)
 
Sales change from new and
      closed stores, net
$
   (2.6
)
   
$
9.4
     
$
(4.6
)
   
$
23.6
   
                                       
Sales per square foot, excluding
      e-commerce (thirteen and twenty-six
      weeks ended)
$
44
     
$
39
     
$
89
     
$
78
   
Sales per square foot, excluding
      e-commerce (trailing twelve-months)
$
179
     
$
162
     
$
179
     
$
162
   
Square footage (thousand sq. ft.)
 
7,845
       
8,091
       
7,845
       
8,091
   
                                       
Stores opened
 
7
       
13
       
18
       
52
   
Stores closed
 
13
       
12
       
19
       
23
   
Ending stores
 
1,128
       
1,167
       
1,128
       
1,167
   

Net Sales
Net sales increased $33.2 million, or 10.6%, to $347.3 million for the second quarter of 2010, compared to $314.1 million for the second quarter of last year. Same-store sales increased 11.8% during the second quarter of 2010, reflecting an improved retail environment resulting in a higher conversion rate in our stores, higher average retail prices and increases in customer traffic levels. A lower store count partially offset the same-store sales increase. During the second quarter of 2010, we opened seven new stores and closed 13 stores, resulting in 1,128 stores and total square footage of 7.8 million at the end of the second quarter of 2010, compared to 1,167 stores and total square footage of 8.1 million at the end of the second quarter of last year. As a result of the same-store sales increase, sales per square foot increased 12.9% to $44, compared to $39 in the second quarter of last year. Our customer loyalty program, Rewards, continues to account for a majority of the segment’s sales, as approximately 59% of our net sales were made to members of our Rewards program in the second quarter of 2010, compared to 61% in the second quarter of last year.

Net sales increased $77.8 million, or 12.3%, to $709.5 million in the first half of 2010, compared to $631.7 million in the first half of last year. Same-store sales increased 13.6% for the first half of 2010 for the same reasons as those described above for the second quarter. Our same-store sales increase was partially offset by a lower store count. As a result of the same-store sales increase, sales per square foot increased 14.4% to $89, compared to $78 in the first half of last year.

Gross Profit
Gross profit increased $25.3 million, or 18.8%, to $159.6 million for the second quarter of 2010, compared to $134.3 million for the second quarter of last year, due to the higher net sales and a higher gross profit rate. As a percent of net sales, our gross profit was 46.0% for the second quarter of 2010, compared to 42.8% for the second quarter of last year. The increase in our gross profit rate was driven by strong sales of higher-margin categories and a significant decrease in promotional activity during the quarter.

Gross profit increased $53.0 million, or 19.6%, to $323.8 million in the first half of 2010, compared to $270.8 million in the first half of last year, reflecting an increase in net sales and a higher gross profit rate. As a percent of net sales, our gross profit was 45.6% in the first half of 2010, up from 42.9% in the first half of last year due to the same factors described above for the second quarter.

 
34
 
Selling and Administrative Expenses
Selling and administrative expenses increased $8.7 million, or 6.4%, to $143.8 million for the second quarter of 2010, compared to $135.1 million for the second quarter of last year. The increase was primarily attributable to higher selling and merchandising expenses, some of which are variable with higher sales volume, higher marketing expenses and higher expected payments under our incentive plans. These increases were partially offset by lower retail facilities expenses, primarily resulting from the lower store count. As a percent of net sales, selling and administrative expenses decreased to 41.5% for the second quarter of 2010, compared to 43.1% for the second quarter of last year, reflecting the above named factors and better leveraging of our expense base over the higher sales volume.

Selling and administrative expenses increased $11.3 million, or 4.2%, to $279.9 million for the first half of 2010, compared to $268.6 million in the first half of last year, due to the same factors as described above for the second quarter of 2010. As a percentage of net sales, selling and administrative expenses decreased to 39.4% in the first half of 2010 from 42.6% in the first half of last year, reflecting the above named factors and better leveraging of our expense base over the higher sales volume.

Operating Earnings (Loss)
Operating earnings increased $16.6 million, or 1,961.8%, to $15.8 million for the second quarter of 2010, compared to an operating loss of $0.8 million for the second quarter of last year. The increase reflects the continued improvement in our business, a higher conversion rate in our stores, higher average retail prices and increases in customer traffic levels. These factors resulted in an increase in net sales and gross profit rate, partially offset by the increase in selling and administrative expenses, as described above. As a percent of net sales, operating earnings increased to 4.5% in the second quarter of 2010, compared to an operating loss of 0.3% in the second quarter of last year.

Operating earnings increased $41.7 million, or 1,900.6%, to $43.9 million for the first half of 2010, compared to $2.2 million in the first half of last year for the same reasons as those described above for the second quarter. As a percent of net sales, operating earnings increased to 6.2% in the first half of 2010, compared to 0.3% in the first half of last year.

 
WHOLESALE OPERATIONS
 

 
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
July 31, 2010
 
August 1, 2009
 
July 31, 2010
 
August 1, 2009
($ millions)
   
% of
Net
Sales
       
% of
Net
Sales
     
% of
Net
Sales
     
% of
Net
 Sales
Operating Results
                                     
Net sales
$
178.6
 
100.0%
 
$
142.0
 
100.0%
 
$
353.4
 
100.0%
 
$
310.9
 
100.0%
Cost of goods sold
 
124.5
 
69.7%
   
95.7
 
67.4%
   
242.7
 
68.7%
   
215.2
 
69.2%
Gross profit
 
54.1
 
30.3%
   
46.3
 
32.6%
   
110.7
 
31.3%
   
95.7
 
30.8%
Selling and administrative expenses
 
44.9
 
25.1%
   
38.3
 
27.0%
   
92.7
 
26.2%
   
81.9
 
26.4%
Restructuring and other special charges, net
 
0.2
 
0.1%
   
0.1
 
0.1%
   
0.3
 
0.1%
   
–
 
–
Operating earnings
$
9.0
 
5.1%
 
$
7.9
 
5.5%
 
$
17.7
 
5.0%
 
$
13.8
 
4.4%
                                       
Key Metrics
                                     
Unfilled order position at end of period
$
317.2
     
$
198.8
                       

Net Sales
Net sales increased $36.6 million, or 25.8%, to $178.6 million for the second quarter of 2010, compared to $142.0 million for the second quarter of last year. Demand for many of our brands continued to strengthen in the second quarter of 2010, as our brand performance at our retail customers improved.  We experienced sales growth in many of our brands, including primarily our Dr. Scholl’s, Sam Edelman, Vera Wang Lavender and Via Spiga divisions. The sales growth was partially offset by a sales decline in our Children’s division. The sales growth was driven by sales increases across all of our channels of distribution, particularly in the mid-tier channel. The Company’s unfilled order position increased $118.4 million, or 59.5%, to $317.2 million as of July 31, 2010, as compared to $198.8 million as of August 1, 2009. This percentage increase was consistent with the percentage increase in the first quarter of 2010 and continues to reflect both our strong growth expectations and the earlier receipt of orders from our retail customers in 2010, impacted by shifts in capacity in China and retail order flow. Although our unfilled order position has increased 59.5% over last year, as mentioned earlier, we expect a net sales increase in 2010 for our Wholesale Operations in the high-teens percentage range as compared to 2009.


 
35
 
Net sales increased $42.5 million, or 13.7%, to $353.4 million in the first half of 2010, compared to $310.9 million in the first half of last year. We experienced sales growth from many of our brands, including primarily our Dr. Scholl’s, Sam Edelman, Vera Wang Lavender, Via Spiga and Naturalizer divisions. The sales growth was partially offset by sales declines in our Children’s and Etienne Aigner divisions. The sales growth was driven by sales increases across most of our channels of distribution, partially offset by sales declines in our mass merchandise channel.

Gross Profit
Gross profit increased $7.8 million, or 16.8%, to $54.1 million for the second quarter of 2010, compared to $46.3 million for the second quarter of last year, due to the increase in net sales, partially offset by a decline in gross profit rate. As a percent of net sales, our gross profit decreased to 30.3% for the second quarter of 2010 from 32.6% for the second quarter of last year. The decrease in the gross profit rate was due primarily to the increased mix of our wholesale brands sold to third parties as well as shifts in channel and brand mix and increased air freight costs.

Gross profit increased $15.0 million, or 15.7%, to $110.7 million in the first half of 2010, compared to $95.7 million in the first half of last year. As a percent of net sales, our gross profit increased to 31.3% in the first half of 2010 from 30.8% in the first half of last year. The increase in the gross profit rate was primarily due to lower provisions for customer allowances and markdowns, partially offset by the increased mix of our wholesale brands being sold to third parties, as discussed above.

Selling and Administrative Expenses
Selling and administrative expenses increased $6.6 million, or 17.1%, to $44.9 million for the second quarter of 2010, compared to $38.3 million for the second quarter of last year, due primarily to $1.4 million of higher expected payments under our incentive plans and higher marketing expenses. As a percent of net sales, selling and administrative expenses decreased to 25.1% for the second quarter of 2010, compared to 27.0% for the second quarter of last year, reflecting the above named factors and better leveraging of our expense base over the higher sales volume.

Selling and administrative expenses increased $10.8 million, or 13.1%, to $92.7 million for the first half of 2010, compared to $81.9 million in the first half of last year, due primarily to $4.3 million of higher expected payments under our incentive plans. We also experienced increases in marketing expenses and higher selling and merchandising expenses, some of which are variable with higher sales volume. As a percent of net sales, selling and administrative expenses decreased to 26.2% in the first half of 2010 from 26.4% in the first half of last year, reflecting better leveraging of our expense base over the higher sales volume.

Restructuring and Other Special Charges, Net
We incurred restructuring and other special charges, net of $0.2 million during the second quarter of 2010, with $0.1 million of corresponding charges during the second quarter of last year. All charges incurred during the first half of 2010 and 2009 are related to our integrated ERP information technology system that is replacing select existing internally developed and certain other third-party applications.

Operating Earnings
Operating earnings increased $1.1 million, or 14.5%, to $9.0 million for the second quarter of 2010, compared to $7.9 million for the second quarter of last year. The increase was primarily driven by the increase in net sales, partially offset by the decrease in gross profit rate and increase in selling and administrative expenses, as described above. As a percent of net sales, operating earnings declined to 5.1% for the second quarter of 2010, compared to 5.5% for the second quarter of last year.

Operating earnings increased $3.9 million, or 28.4%, to $17.7 million for the first half of 2010, compared to $13.8 million in the first half of last year due to the increase in net sales and gross profit rate, partially offset by the increase in selling and administrative expenses, as described above. As a percent of net sales, operating earnings increased to 5.0% in the first half of 2010, compared to 4.4% in the first half of last year.

 
36
 

SPECIALTY RETAIL
 

 
Thirteen Weeks Ended
 
Twenty-six Weeks Ended
 
July 31, 2010
 
August 1, 2009
 
July 31, 2010
 
August 1, 2009
($ millions, except sales per square foot)
     
% of
Net
Sales
     
% of
Net
Sales
     
% of
Net
Sales
     
% of
Net
 Sales
Operating Results
                                     
Net sales
$
59.8
 
100.0%
 
$
55.5
 
100.0%
 
$
120.6
 
100.0%
 
$
107.8
 
100.0%
Cost of goods sold
 
35.0
 
58.6%
   
32.5
 
58.4%
   
69.1
 
57.3%
   
62.5
 
58.0%
Gross profit
 
24.8
 
41.4%
   
23.0
 
41.6%
   
51.5
 
42.7%
   
45.3
 
42.0%
Selling and administrative expenses
 
27.5
 
46.0%
   
27.3
 
49.4%
   
57.2
 
47.4%
   
55.8
 
51.8%
Operating loss
$
(2.7
)
(4.6)%
 
$
(4.3
)
(7.8)%
 
$
(5.7
)
(4.7)%
 
$
(10.5
)
(9.8)%
                                       
Key Metrics
                                     
Same-store sales % change
 
6.8%
       
(3.8)%
       
11.3%
       
(4.9)%
   
Same-store sales $ change
$
2.7
     
$
(1.6
)
   
$
8.5
     
$
(3.8
)
 
Sales change from new and closed
      stores, net
$
(1.7
)
   
$
(0.2
)
   
$
(3.9
)
   
$
0.6
   
Impact of changes in Canadian
      exchange rate on sales
$
1.4
     
$
(1.9
)
   
$
4.3
     
$
(4.8
)
 
Sales change of e-commerce
      subsidiary
$
1.9
     
$
(3.8
)
   
$
3.9
     
$
(5.2
)
 
                                       
Sales per square foot, excluding
      e-commerce (thirteen and twenty-
      six weeks ended)
$
94
     
$
83
     
$
180
     
$
152
   
Sales per square foot, excluding
      e-commerce (trailing twelve-
      months)
$
371
     
$
326
     
$
371
     
$
326
   
Square footage (thousand sq. ft.)
 
435
       
467
       
435
       
467
   
                                       
Stores opened
 
–
       
1
       
2
       
2
   
Stores closed
 
5
       
11
       
20
       
19
   
Ending stores
 
264
       
289
       
264
       
289
   

Net Sales
Net sales increased $4.3 million, or 7.8%, to $59.8 million for the second quarter of 2010, compared to $55.5 million for the second quarter of last year. A same-store sales increase of 6.8% in our retail stores, higher net sales at Shoes.com and an increase in the Canadian dollar exchange rate led to an overall increase in our level of net sales. A lower store count, as a result of store closings, partially offset the net sales increases. The net sales of Shoes.com increased $1.9 million, or 14.8%, to $14.8 million for the second quarter of 2010, compared to $12.9 million for the second quarter of last year, reflecting an increase in site visits. We did not open any new stores and closed five stores during the second quarter of 2010, resulting in a total of 264 stores (including eight Naturalizer stores in China) and total square footage of 435,000 at the end of the second quarter of 2010, compared to 289 stores (including 13 Naturalizer stores in China) and total square footage of 467,000 at the end of the second quarter of last year. As a result of the increases in same-store sales and the Canadian dollar exchange rate, sales per square foot, excluding e-commerce, increased 13.2% to $94 for the second quarter of 2010, compared to $83 for the second quarter of last year.

Net sales increased $12.8 million, or 11.9%, to $120.6 million in the first half of 2010, compared to $107.8 million in the first half of last year. A same-store sales increase of 11.3% in our retail stores, an increase in the Canadian dollar exchange rate and higher net sales at Shoes.com led to an overall increase in our level of net sales. A lower store count partially offset the same-store sales increase. The net sales at Shoes.com increased $3.9 million, or 13.9%, to $31.8 million in the first half of 2010, compared to $27.9 million in the first half of last year. Sales per square foot, excluding e-commerce, increased 18.7% to $180, compared to $152 in the first half of last year as a result of the increases in same-store sales and the Canadian dollar exchange rate.


 
37
 
Gross Profit
Gross profit increased $1.8 million, or 7.5%, to $24.8 million for the second quarter of 2010, compared to $23.0 million for the second quarter of last year, primarily reflecting higher net sales. As a percent of net sales, our gross profit decreased to 41.4% for the second quarter of 2010 from 41.6% for the second quarter of last year. The decrease in our overall rate was primarily driven by a lower gross profit rate for Shoes.com, partially offset by improved retail sell-through resulting in lower markdowns for our retail stores.

Gross profit increased $6.2 million, or 13.7%, to $51.5 million in the first half of 2010, compared to $45.3 million in the first half of last year, reflecting higher net sales and a higher gross profit rate. As a percentage of net sales, our gross profit increased to 42.7% in the first half of 2010 from 42.0% in the first half of last year due to improved retail sell-through resulting in lower markdowns for our retail stores, partially offset by a decline in gross profit rate for Shoes.com.

Selling and Administrative Expenses
Selling and administrative expenses increased $0.2 million, or 0.6%, to $27.5 million for the second quarter of 2010, compared to $27.3 million for the second quarter of last year, due primarily to an increase in the Canadian dollar exchange rate, partially offset by declines in retail facilities expenses, primarily resulting from the lower store count. As a percent of net sales, selling and administrative expenses decreased to 46.0% for the second quarter of 2010, compared to 49.4% for the second quarter of last year, reflecting the factors listed above and better leveraging of our expense base over the higher sales volume.

Selling and administrative expenses increased $1.4 million, or 2.5%, to $57.2 million for first half of 2010, compared to $55.8 million in the first half of last year, due to the same factors as described above for the second quarter. As a percent of net sales, selling and administrative expenses decreased to 47.4% in the first half of 2010 from 51.8% in the first half of last year, reflecting better leveraging of our expense base over higher sales volume.

Operating Loss
Specialty Retail reported an operating loss of $2.7 million for the second quarter of 2010, compared to an operating loss of $4.3 million for the second quarter of last year, due primarily to an increase in net sales, partially offset by a decline in gross profit rate and increased selling and administrative expenses, as described above.

Specialty Retail reported an operating loss of $5.7 million in the first half of 2010, compared to an operating loss of $10.5 million in the first half of last year, as a result of an increase in net sales and gross profit rate, partially offset by increased selling and administrative expenses, as described above.


OTHER SEGMENT
 

The Other segment includes unallocated corporate administrative expenses and other costs and recoveries. The segment reported costs of $9.9 million for the second quarter of 2010, compared to costs of $7.7 million for the second quarter of last year.

There were several factors impacting the $2.2 million variance, as follows:

·  
Incentive plans – Our selling and administrative expenses were higher by $2.2 million during the second quarter of 2010, as compared to the second quarter of last year, due to higher expected payments under our incentive plans.
·  
Lower expenses related to director compensation expenses, as certain director compensation arrangements are variable based on the Company’s stock price, which decreased during the second quarter of 2010.
·  
Information technology initiatives – We incurred expenses of $1.7 million during the second quarter of 2010 related to our integrated ERP information technology system, $0.2 million lower than the $1.9 million in corresponding expenses incurred during the second quarter of last year.


 
38
 
Unallocated corporate administrative expenses and other costs, net of recoveries, were $22.5 million in the first half of 2010, compared to $17.6 million in the first half of last year.

There were several factors impacting the $4.9 million variance, as follows:

·  
Incentive plans – Our selling and administrative expenses were higher by $3.6 million during the first half of 2010, as compared to the first half of last year, reflecting higher expected payments under our incentive plans.
·  
Higher expenses related to director compensation expenses, as certain director compensation arrangements are variable based on the Company’s stock price, which increased during the first half of 2010.
·  
Information technology initiatives – We incurred expenses of $3.3 million during the first half of 2010, related to our integrated ERP information technology system, $1.3 million lower than the $4.6 million in corresponding expenses during the first half of last year.


LIQUIDITY AND CAPITAL RESOURCES
 

Borrowings

($ millions )
July 31,
2010
 
August 1,
2009
 
January 30,
2010
 
Borrowings under revolving credit agreement
$
35.5
 
$
47.5
 
$
94.5
 
Senior notes
 
150.0
   
150.0
   
150.0
 
Total debt
$
185.5
 
$
197.5
 
$
244.5
 

Despite a $32.7 million cash outlay associated with our investment in Edelman Shoe during the second quarter of 2010, as discussed in Note 3 to the condensed consolidated financial statements, our total debt obligations decreased $12.0 million to $185.5 million at July 31, 2010, compared to $197.5 million at August 1, 2009. Total debt obligations decreased $59.0 million from $244.5 million at January 30, 2010. The decreases between periods resulted from having fewer borrowings outstanding under our revolving credit agreement at July 31, 2010, reflecting our strong financial performance and generation of operating cash flow in the first half of 2010. Interest expense for the second quarter of 2010 decreased $0.2 million to $4.7 million, compared to $4.9 million for the second quarter of last year primarily due to lower interest rates on average borrowings under our revolving credit agreement. Interest expense in the first half of 2010 decreased $0.8 million to $9.4 million, compared to $10.2 million in the first half of last year primarily due to lower average borrowings and lower interest rates on average borrowings under our revolving credit agreement.

Credit Agreement
On January 21, 2009, Brown Shoe Company, Inc. and certain of our subsidiaries (the “Loan Parties”) entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”). The Credit Agreement matures on January 21, 2014. The Credit Agreement provides for revolving credit in an aggregate amount of up to $380.0 million, subject to the calculated borrowing base restrictions. Borrowing availability under the Credit Agreement is limited to the lesser of the total commitments and the borrowing base, which is based on stated percentages of the sum of eligible receivables and inventories, as defined, less applicable reserves. Under the Credit Agreement, the Loan Parties’ obligations are secured by a first priority security interest in receivables, inventories and certain other collateral.

Interest on borrowings is at variable rates based on the LIBOR or the prime rate, as defined in the Credit Agreement. The interest rate and fees for letters of credit varies based upon the level of excess availability under the Credit Agreement. There is an unused line fee payable on the excess availability under the facility and a letter of credit fee payable on the outstanding exposure under letters of credit.
 
The Credit Agreement limits our ability to incur additional indebtedness, create liens, make investments or specified payments, give guarantees, pay dividends, make capital expenditures and merge or acquire or sell assets. In addition, certain additional covenants would be triggered if excess availability were to fall below specified levels, including fixed charge coverage ratio requirements. Furthermore, if excess availability falls below the greater of (i) 17.5% of the lesser of (x) the borrowing base or (y) the total commitments and (ii) $25.0 million for three consecutive business days, or an event of default occurs, the lenders may assume dominion and control over our cash (a “cash dominion event”) until such event of default is cured or waived or the excess availability exceeds such amount for 30 consecutive days.


 
39
 
The Credit Agreement contains customary events of default, including, without limitation, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to similar obligations, certain events of bankruptcy and insolvency, judgment defaults and the failure of any guaranty or security document supporting the agreement to be in full force and effect. In addition, if the excess availability falls below the greater of (i) 17.5% of the lesser of (x) the borrowing base or (y) the total commitments and (ii) $25.0 million and the fixed charge coverage ratio is less than 1.0 to 1.0, we would be in default under the Credit Agreement. The Credit Agreement also contains certain other covenants and restrictions, with which we were in compliance as of July 31, 2010.

At July 31, 2010, we had $35.5 million of borrowings outstanding and $12.6 million in letters of credit outstanding under the Credit Agreement. Total additional borrowing availability was $331.9 million at the end of the second quarter of 2010.

We believe that borrowing capacity under our Credit Agreement will be adequate to meet our expected operational needs and capital expenditure plans and provide liquidity for potential acquisitions.

Senior Notes
In April 2005, we issued $150.0 million of 8.75% senior notes due in 2012 (“Senior Notes”). The Senior Notes are guaranteed on a senior unsecured basis by each of the subsidiaries of Brown Shoe Company, Inc. that is an obligor under the Credit Agreement. Interest on the Senior Notes is payable on May 1 and November 1 of each year. The Senior Notes mature on May 1, 2012, but became callable on May 1, 2009.  We may redeem all or a part of the Senior Notes at specified redemption prices (expressed as a percentage of principal amount) set forth below, plus accrued and unpaid interest, if redeemed during the twelve-month period beginning on May 1 of the years indicated below:

                   
Year
             
Percentage
 
2010
                     
102.188
%
2011 and thereafter
                     
100.000
%

The Senior Notes also contain certain other covenants and restrictions that limit certain activities including, among other things, levels of indebtedness, payments of dividends, the guarantee or pledge of our assets, certain investments, common stock repurchases, mergers and acquisitions and sales of assets. As of July 31, 2010, we were in compliance with all covenants relating to the Senior Notes.

Working Capital and Cash Flow
           
 
Twenty-six Weeks Ended
       
($ millions)
July 31, 2010
 
August 1, 2009
 
Increase/
(Decrease)
   
                     
Net cash provided by operating activities
$
27.0
 
$
49.7
 
$
(22.7
)
 
Net cash used for investing activities
 
(24.7
)
 
(28.8
)
 
4.1
   
Net cash used for financing activities
 
(97.4
)
 
(71.1
)
 
(26.3
)
 
Effect of exchange rate changes on cash
 
–
   
0.6
   
(0.6
)
 
Decrease in cash and cash equivalents
$
(95.1
)
$
(49.6
)
$
(45.5
)
 

Reasons for the major variances in cash provided (used) in the table above are as follows:

Cash provided by operating activities was lower by $22.7 million, reflecting several factors:
·  
A larger increase in inventories in the first half of 2010 compared to the first half of last year due to the timing and amount of sales as well as purchases to support higher sales levels; and
·  
An increase in receivables during the first half of 2010 as compared to a decrease in the first half of last year due to the timing and amount of receipts and sales.
Partially offset by,
·  
An increase in trade accounts payable during the first half of 2010 as compared to the first half of last year due to the timing and amount of purchases and payments to vendors; and
·  
An increase in net earnings.

 
40
 
Cash used for investing activities was lower by $4.1 million primarily as a result of lower purchases of property and equipment related to our new and remodeled stores. In addition, the first half of 2009 included capital expenditures related to a new distribution center, whereas no corresponding expenditures occurred during the first half of 2010. At our retail divisions, we opened 20 stores during the first half of 2010 compared to 54 stores in the first half of 2009.  In 2010, we expect purchases of property and equipment and capitalized software of approximately $60.0 million to $63.0 million, primarily related to our information technology initiatives, new and remodeled stores, logistics network and general infrastructure.

Cash used for financing activities was higher by $26.3 million primarily due to the acquisition of the remaining 50% of our noncontrolling interest in Edelman Shoe. See Note 3 to the condensed consolidated financial statements for additional information regarding our interests in Edelman Shoe during the first half of 2010.

A summary of key financial data and ratios at the dates indicated is as follows:
           
 
July 31, 2010
 
August 1, 2009
 
January 30, 2010
           
Working capital ($ millions )
$ 278.1
 
$ 263.2
 
$ 294.2
           
Current ratio
1.59:1
 
1.63:1
 
1.71:1
           
Total debt as a percentage of total capitalization
32.1%
 
33.7%
 
37.3%

Working capital at July 31, 2010, was $278.1 million, which was $16.1 million lower than at January 30, 2010 and $14.9 million higher than at August 1, 2009. Our current ratio, the relationship of current assets to current liabilities, decreased to 1.59 to 1 compared to 1.71 to 1 at January 30, 2010 and 1.63 to 1 at August 1, 2009. The decrease compared to January 30, 2010 was primarily attributable to higher trade accounts payable and lower cash and cash equivalents, partially offset by higher inventories, lower borrowings under our revolving credit agreement and higher receivables. The decrease compared to August 1, 2009 was primarily attributable to higher trade accounts payable, lower prepaid expenses and other current assets and lower cash and cash equivalents, partially offset by higher inventories and receivables and lower borrowings under our revolving credit agreement. Our debt-to-capital ratio, the ratio of our debt obligations to the sum of our debt obligations and equity, was 32.1% as of July 31, 2010, compared to 37.3% as of January 30, 2010 and 33.7% as of August 1, 2009. The decline from January 30, 2010 and August 1, 2009 primarily reflected a decline in borrowings under our revolving credit agreement.

At July 31, 2010, we had $30.7 million of cash and cash equivalents, a portion of which represents cash and cash equivalents of our Canadian and other foreign subsidiaries. As a result of recently issued Internal Revenue Service guidelines expanding the length of time that our parent company can borrow funds from foreign subsidiaries, Brown Shoe Company, Inc. is able to more fully utilize the cash and cash equivalents of its foreign subsidiaries than in the past, better managing the liquidity needs of the consolidated company and minimizing interest expense on a consolidated basis.

We paid dividends of $0.07 per share in both the second quarter of 2010 and the second quarter of 2009. On August 23, 2010, the Board of Directors declared a quarterly dividend of $0.07 per share, payable October 1, 2010 to shareholders of record on September 17, 2010, marking the 351 st consecutive quarterly dividend to be paid by the Company. The declaration and payment of any future dividend is at the discretion of the Board of Directors and will depend on our results of operations, financial condition, business conditions and other factors deemed relevant by our Board of Directors; however, we presently expect that dividends will continue to be paid.


OFF BALANCE SHEET ARRANGEMENTS
 

At July 31, 2010, we were contingently liable for remaining lease commitments of approximately $1.4 million in the aggregate, which relate to former retail locations that we exited in prior years. These obligations will continue to decline over the next several years as leases expire. In order for us to incur any liability related to these lease commitments, the current lessees would have to default.


 
41
 


CONTRACTUAL OBLIGATIONS
 

Our contractual obligations primarily consist of operating lease commitments, purchase obligations, long-term debt, interest on long-term debt, minimum license commitments, borrowings under our revolving credit agreement, obligations for our supplemental executive retirement plan and other postretirement benefits and obligations related to our restructuring and expense and capital containment initiatives. There have been no significant changes to our contractual obligations identified in our Annual Report on Form 10-K for the year ended January 30, 2010, other than the reduction of our obligations related to restructuring and expense and capital containment initiatives as a result of settlements during the first half of 2010 as disclosed in Note 6 to the condensed consolidated financial statements and those which occur in the normal course of business (primarily changes in purchase obligations, which fluctuate throughout the year as a result of the seasonal nature of our operations, borrowings/payments under our revolving credit agreement and changes in operating lease commitments as a result of new stores, store closures and lease renewals).


CRITICAL ACCOUNTING POLICIES AND ESTIMATES
 

No material changes have occurred related to critical accounting policies and estimates since the end of the most recent fiscal year. The adoption of new accounting pronouncements is described in Note 2 to the condensed consolidated financial statements.  For further information, see Item 7 of our Annual Report on Form 10-K for the year ended January 30, 2010.


RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
 

Recently issued accounting pronouncements and their impact on the Company are described in Note 2 to the condensed consolidated financial statements.


FORWARD-LOOKING STATEMENTS
 

This Form 10-Q contains certain forward-looking statements and expectations regarding the Company’s future performance and the future performance of its brands. Such statements are subject to various risks and uncertainties that could cause actual results to differ materially. These include (i) changing consumer demands, which may be influenced by consumers' disposable income, which in turn can be influenced by general economic conditions; (ii) the timing and uncertainty of activities and costs related to the Company’s information technology initiatives, including software implementation and business transformation; (iii) potential disruption to the Company’s business and operations as it implements its information technology initiatives; (iv) the Company’s ability to utilize its new information technology system to successfully execute its strategies; (v) intense competition within the footwear industry; (vi) rapidly changing fashion trends and purchasing patterns; (vii) customer concentration and increased consolidation in the retail industry; (viii) political and economic conditions or other threats to continued and uninterrupted flow of inventory from China and Brazil, where the Company relies heavily on third-party manufacturing facilities for a significant amount of its inventory; (ix) the Company's ability to attract and retain licensors and protect its intellectual property; (x) the Company's ability to secure/exit leases on favorable terms; (xi) the Company's ability to maintain relationships with current suppliers; (xii) compliance with applicable laws and standards with respect to lead content in paint and other product safety issues; (xiii) the Company’s ability to successfully execute its international growth strategy; (xiv) the Company’s ability to source product at a pace consistent with increased demand for footwear; and (xv) the impact of rising prices in a potentially inflationary global environment. The Company’s reports to the Securities and Exchange Commission (the “Commission”) contain detailed information relating to such factors, including, without limitation, the information under the caption “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended January 30, 2010, which information is incorporated by reference herein and updated by the Company’s Quarterly Reports on Form 10-Q. The Company does not undertake any obligation or plan to update these forward-looking statements, even though its situation may change.


ITEM 3
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

No material changes have taken place in the quantitative and qualitative information about market risk since the end of the most recent fiscal year. For further information, see Part II, Item 7A of the Company's Annual Report on Form 10-K for the year ended January 30, 2010.


 
42
 

ITEM 4
CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures
It is the Chief Executive Officer's and Chief Financial Officer's ultimate responsibility to ensure we maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms and is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures include mandatory communication of material events, automated accounting processing and reporting, management review of monthly, quarterly and annual results, an established system of internal controls and internal control reviews by our internal auditors.

A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance the objectives of the control system are met. Further, the design of a control system must reflect the fact there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to errors or fraud may occur and not be detected.  Our disclosure controls and procedures are designed to provide a reasonable level of assurance that their objectives are achieved.  As of July 31, 2010, management of the Company, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934). Based upon and as of the date of that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting
The Company is in the process of implementing an integrated ERP information technology system that is replacing select existing internally developed and certain other third-party applications. Implementation began in 2008 and is scheduled to be substantially complete in the fourth quarter of 2010. We have updated our internal control over financial reporting as necessary to accommodate the modifications to our business processes and related internal control over financial reporting. This ERP system, along with the internal control over financial reporting impacted by the phased implementation, were appropriately tested for design effectiveness. While some processes and controls will continue to evolve as the phased implementation continues, existing controls and the controls affected by the implementation of the new system were evaluated as being appropriate and effective. As the Company continues the phased implementation of the new ERP system, it expects that there will be additional changes in business processes and related internal control over financial reporting. Our assessment of the operating effectiveness of internal control over financial reporting will be performed as part of our annual evaluation of internal control over financial reporting as of January 29, 2011. There were no other significant changes to internal control over financial reporting during the quarter ended July 31, 2010, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.


PART II
OTHER INFORMATION

ITEM 1
LEGAL PROCEEDINGS

We are involved in legal proceedings and litigation arising in the ordinary course of business. In the opinion of management, the outcome of such ordinary course of business proceedings and litigation currently pending will not have a material adverse effect on our results of operations or financial position. All legal costs associated with litigation are expensed as incurred.

Information regarding Legal Proceedings is set forth within Note 15 to the condensed consolidated financial statements and incorporated by reference herein.


 
43
 

ITEM 1A
RISK FACTORS

No material changes have occurred related to our risk factors since the end of the most recent fiscal year. For further information, see Part I, Item 1A of our Annual Report on Form 10-K for the year ended January 30, 2010.


ITEM 2
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides information relating to our repurchases of common stock during the second quarter of 2010:

Fiscal Period
 
Total Number
of Shares
Purchased
  Average
Price Paid
per Share
Total Number
of Shares Purchased
as Part of Publicly
Announced Program (1)
 
Maximum Number
of Shares that
May Yet Be
Purchased Under
the Program
 (1)
   
                   
May 2, 2010 – May 29, 2010
 
–
 
$
–
 
­–
   
2,500,000
 
                       
May 30, 2010 – July 3, 2010
 
–
   
–
 
–
   
2,500,000
 
                       
July 4, 2010 – July 31, 2010
 
–
   
–
 
–
   
2,500,000
 
                       
Total
 
–
 
$
–
 
–
   
2,500,000
 
(1)  
In January 2008, the Board of Directors approved a stock repurchase program authorizing the repurchase of up to 2.5 million shares of our outstanding common stock. We can utilize the repurchase program to repurchase shares on the open market or in private transactions from time to time, depending on market conditions. The repurchase program does not have an expiration date. Under this plan, no shares were repurchased through the end of the second quarter of 2010; therefore, there were 2.5 million shares authorized to be purchased under the program as of July 31, 2010. Our repurchases of common stock are limited under our debt agreements.


ITEM 3
DEFAULTS UPON SENIOR SECURITIES

None.


ITEM 4
(REMOVED AND RESERVED)


ITEM 5
OTHER INFORMATION

None.


 
44
 



ITEM 6
EXHIBITS

Exhibit
No.
   
3.1
 
Restated Certificate of Incorporation of Brown Shoe Company, Inc. (the “Company”), incorporated herein by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended May 5, 2007 and filed June 5, 2007.
3.2
 
Bylaws of the Company as amended through October 2, 2008, incorporated herein by reference to Exhibit 3.1 to the Company’s Form 8-K dated October 8, 2008 and filed October 8, 2008.
4.1
†
Supplemental Indenture for 8.75% Senior Notes due 2012, dated as of June 18, 2010, between Edelman Shoe, Inc., the Company and U.S. Bank National Association, a national banking association, as successor to SunTrust Bank, as trustee.
10.1
 
 
 
 
10.2
10.3
 
10.4
10.5
10.6
† #
 
 
 
 
† *
† *
 
† *
† *
† *
 
Second Amended and Restated Credit Agreement, dated as of January 21, 2009 (the “Credit Agreement”), among the Company, as lead borrower for itself and on behalf of certain of its subsidiaries, and Bank of America, N.A., as lead issuing bank, administrative agent and collateral agent, Wells Fargo Retail Finance, LLC, as syndication agent, Bank of America, N.A. and JPMorgan Chase Bank, N.A., as co-documentation agents, and the other financial institutions party thereto, as lenders.
Summary of compensatory arrangements for the named executive officers of the Company.
Amendment letter dated December 18, 2009, to the Severance Agreement (April 1, 2006), between the Company and Ronald A. Fromm.
Severance Agreement, effective April 1, 2006, between the Company and Richard M. Ausick.
Severance Agreement, effective April 1, 2009, between the Company and Mark D. Lardie.
Form of Amendment letter dated December 18, 2009, to the Severance Agreements between the Company and each of: Richard M. Ausick, Mark E. Hood, Mark D. Lardie, Diane M. Sullivan, and Joseph W. Wood.
10.7
†
Joinder to Credit Agreement, made as of June 18, 2010, by and between Edelman Shoe, Inc. and Bank of America, N.A., as Administrative Agent and Collateral Agent for the lenders party to the Credit Agreement.
31.1
†
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
†
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1
†
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
† Denotes exhibit is filed with this Form 10-Q.
# Confidential treatment requested as to certain portions, which portions are omitted and filed separately with the Securities and Exchange Commission.
* Denotes management contract or compensatory plan arrangements.


 
45
 



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.

   
BROWN SHOE COMPANY, INC.
     
Date: September 7, 2010
 
/s/ Mark E. Hood
   
Mark E. Hood
Senior Vice President and Chief Financial Officer
on behalf of the Registrant and as the
Principal Financial Officer and Principal Accounting Officer


 
46
 


 
 
 
Exhibit 4.1


SUPPLEMENTAL INDENTURE
 
Supplemental Indenture (this “ Supplemental Indenture ”), dated as of June 18, 2010, between EDELMAN SHOE, INC., a Delaware corporation (the “ Guaranteeing Subsidiary ”), a subsidiary of Brown Shoe Company, Inc., a New York corporation (the “ Company ”), the Company and U.S. Bank National Association, a national banking association, as successor to SunTrust Bank, as trustee under the Indenture referred to below (the “ Trustee ”).
 
W I T N E S S E T H
 
WHEREAS, the Company and the other Guarantors party thereto have heretofore executed and delivered to the Trustee an indenture (the “ Indenture ”), dated as of April 22, 2005 providing for the issuance of the Company’s 8.75% Senior Notes due 2012 (the “ Notes ”);
 
WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall, subject to Article Ten of the Indenture, unconditionally guarantee the Notes on the terms and conditions set forth therein (the “ Note Guarantee ”); and
 
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.
 
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, the Guarantors, the Guaranteeing Subsidiary and the Trustee agree as follows for the equal and ratable benefit of the Holders of the Notes:
 
1.            Capitalized Terms .  Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.
 
2.            Agreement to Guarantee .
 
(a)           Subject to Article Ten of the Indenture, the Guaranteeing Subsidiary fully and unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Company hereunder or thereunder, that:
 
(i)           the principal of, premium, if any, and interest and Additional Interest, if any, on the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of, premium, if any, and interest and Additional Interest, if any, on the Notes, if lawful (subject in all cases to any applicable grace period provided herein), and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be promptly paid in full, all in accordance with the terms hereof and thereof; and
 
(ii)           in case of any extension of time of payment or renewal of any Notes or any of such other obligations, the same will be promptly paid in full when due in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.  Failing payment when due of any amount so guaranteed for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately.  The Guaranteeing Subsidiary agrees that this is a guarantee of payment and not a guarantee of collection.
 
(b)           The Guaranteeing Subsidiary hereby agrees that, to the maximum extent permitted under applicable law, its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.
 
(c)           The Guaranteeing Subsidiary, subject to Section 6.06 of the Indenture, hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenants that this Note Guarantee shall not be discharged except by complete performance of the obligations contained in the Notes and the Indenture.
 
(d)           If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors, or any custodian, trustee, liquidator or other similar official acting in relation to any of the Company or the Guarantors, any amount paid by any of them to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.
 
(e)           The Guaranteeing Subsidiary agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.
 
(f)           The Guaranteeing Subsidiary agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article Six of the Indenture for the purposes of the Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article Six of the Indenture, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of the Note Guarantee.
 
(g)           The Guaranteeing Subsidiary shall have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantee.
 
(h)           The Guaranteeing Subsidiary confirms, pursuant to Section 10.02 of the Indenture, that it is the intention of such Guaranteeing Subsidiary that the Note Guarantee not constitute (i) a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to the Note Guarantee or (ii) an unlawful distribution under any applicable state law prohibiting shareholder distributions by an insolvent subsidiary to the extent applicable to the Note Guarantee.  To effectuate the foregoing intention, the Guaranteeing Subsidiary and the Trustee hereby irrevocably agree that the obligations of the Guaranteeing Subsidiary will be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guaranteeing Subsidiary that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under Article Ten of the Indenture, result in the obligations of the Guaranteeing Subsidiary under the Note Guarantee not constituting a fraudulent transfer or conveyance or such an unlawful shareholder distribution.
 
3.            Execution and Delivery .  The Guaranteeing Subsidiary agrees that the Note Guarantee shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of the Note Guarantee.
 
4.            Guaranteeing Subsidiary May Consolidate, Etc., on Certain Terms .  The Guaranteeing Subsidiary may not sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge with or into, any Person other than as set forth in Section 10.04 of the Indenture.
 
5.            Release .  The Guaranteeing Subsidiary’s Note Guarantee shall be released as set forth in Section 10.05 of the Indenture.
 
6.            No Recourse Against Others .  Pursuant to Section 12.07 of the Indenture, no director, officer, employee, incorporator or stockholder of the Guaranteeing Subsidiary shall have any liability for any obligations of the Guaranteeing Subsidiary under the Notes, the Indenture, this Supplemental Indenture, the Note Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation.  This waiver and release are part of the consideration for the Note Guarantee.
 
7.            NEW YORK LAW TO GOVERN .  THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.
 
8.            Counterparts .  The parties may sign any number of copies of this Supplemental Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.
 
9.            Effect of Headings .  The Section headings herein are for convenience only and shall not affect the construction hereof.
 
10.            Trustee .  The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company.
 
[ SIGNATURE PAGE FOLLOWS ]
 

 

 
 
 

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.
 

 
EDELMAN SHOE, INC.
 
By: /s/ Thomas H. Lucas                                                       
Name: Thomas H. Lucas
 
Title:   Senior Vice President, Finance and Corporate Development and Treasurer
 
BROWN SHOE COMPANY, INC.
 
By: /s/ Thomas H. Lucas                                                       
Name: Thomas H. Lucas
 
Title:   Senior Vice President, Finance and Corporate Development and Treasurer
 
U.S. BANK NATIONAL ASSOCIATION,
 
AS TRUSTEE
 
By: /s/ Jack Ellerin                                                       
Name: Jack Ellerin
Title: Vice President
 

 
 
 


 
 
 
EXHIBIT 10.1
 


 

EXPLANATORY NOTE: “*” INDICATES THE PORTION OF THIS EXHIBIT (IN SCHEDULES 3.14 AND 3.22 ATTACHED TO THE AGREEMENTS) THAT HAVE BEEN OMITTED
AND SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.  


 
EXECUTION COPY


SECOND AMENDED AND RESTATED CREDIT AGREEMENT

dated as of
January 21, 2009

among

BROWN SHOE COMPANY, INC.,
as Lead Borrower for:

BROWN SHOE COMPANY, INC.
SIDNEY RICH ASSOCIATES, INC.
BROWN GROUP RETAIL, INC.
BROWN SHOE INTERNATIONAL CORP.
BUSTER BROWN & CO.
BENNETT FOOTWEAR GROUP LLC
and
SHOES.COM, INC.

BROWN SHOE COMPANY OF CANADA LTD
as a Loan Party

The LENDERS Party Hereto,

BANK OF AMERICA, N.A.
as Lead Issuing Bank

BANK OF AMERICA, N.A.
as Administrative Agent and Collateral Agent,


WELLS FARGO RETAIL FINANCE, LLC
as an Issuing Bank and as Syndication Agent,

BANK OF AMERICA, N.A.  and JPMORGAN CHASE BANK, N.A.
as co-Documentation Agents,

and

BANC OF AMERICA SECURITIES LLC and WELLS FARGO RETAIL FINANCE, LLC
as Joint Lead Arrangers,

and

BANC OF AMERICA SECURITIES LLC, WELLS FARGO RETAIL FINANCE, LLC and JPMORGAN CHASE BANK, N.A.
as Joint Lead Bookrunners

 
 
 

TABLE OF CONTENTS
1.           DEFINITIONS .
1.1             Defined Terms
1.2             Terms Generally
1.3             Accounting Terms
1.4              Rounding .
1.5               .
2.          AMOUNT AND TERMS OF CREDIT
2.1              Commitment of the Lenders
2.2             Increase in Total Commitments
2.3              Changes to Reserves
2.4             Making of Loans
2.5             Overadvances
2.6             Swingline Loans .  
2.7             Letters of Credit and Acceptances
2.8             Settlements Amongst Lenders
2.9             Notes; Repayment of Loans
2.10              Interest on Loans
2.11             Default Interest
2.12             Certain Fees
2.13             Commitment Fee
2.14             Letter of Credit Fees
2.15              Acceptance Fee
2.16             Nature of Fees
2.17             Termination or Reduction of Commitments
2.18             Alternate Rate of Interest
2.19             Conversion and Continuation of Loans
2.20              Mandatory Prepayment; Cash Collateral; Commitment Termination
2.21             Optional Prepayment of Loans; Reimbursement of Lenders
2.22             Maintenance of Loan Account; Statements of Account
2.23             Cash Receipts .
2.24              Application of Payments .
2.25              Increased Costs
2.26              Change in Legality
2.27              Payments
2.28             Taxes
2.29             Security Interests in Collateral
2.30             Mitigation Obligations; Replacement of Lenders
3.          REPRESENTATIONS AND WARRANTIES
3.1             Organization; Powers
3.2               .
3.3             Governmental Approvals; No Conflicts
3.4             Financial Condition
3.5              Properties .
3.6             Litigation and Environmental Matters.
3.7             Compliance with Laws and Agreements
3.8             Investment and Holding Company Status
3.9             Taxes
3.10              ERISA; Foreign Plans
3.11              Common Enterprise
3.12              Disclosure
3.13              Subsidiaries
3.14              Insurance
3.15              Labor Matters
3.16              Certain Transactions
3.17              Restrictions on the Loan Parties
3.18             Security Documents
3.19              Federal Reserve Regulations
3.20              Solvency
3.21             Franchises, Patents, Copyrights, Etc
3.22              DDAs, Credit Card Arrangements, Etc
3.23              Customer and Trade Relations
3.24              Casualty
 
4.           CONDITIONS
4.1              Closing Date
4.2              Conditions Precedent to Each Loan and Each Letter of Credit and Each Acceptance
5.          AFFIRMATIVE COVENANTS
5.1             Financial Statements and Other Information
5.2              Notices of Material Events
5.3             Information Regarding Collateral
5.4             Existence; Conduct of Business
5.5             Payment of Obligations
5.6             Maintenance of Properties
5.7              
5.8              Intentionally Omitted
5.9             Books and Records; Inspection and Audit Rights
5.10             Fiscal Year
5.11              Physical Inventories .
5.12              Compliance with Laws
5.13              Use of Proceeds and Letters of Credit and Acceptances
5.14              Additional Subsidiaries
5.15             Further Assurances
6.          NEGATIVE COVENANTS
6.1              Indebtedness and Other Obligations
6.2              Liens
6.3             Fundamental Changes
6.4             Investments, Loans, Advances, Guarantees and Acquisitions
6.5             Asset Sales
6.6             Restrictive Agreements
6.7             Restricted Payments; Certain Payments of Indebtedness
6.8              Transactions with Affiliates
6.9              Additional Subsidiaries
6.10              Amendment of Material Documents
6.11              Environmental Laws
6.12             Fiscal Year
6.13             Minimum Fixed Charge Coverage Ratio
7.          EVENTS OF DEFAULT
7.1              Events of Default
7.2             Remedies on Default
7.3             Application of Proceeds
8.          THE AGENTS
8.1             Administration by Administrative Agent
8.2             Appointment and Duties of Collateral Agent
8.3             Sharing of Excess Payments
8.4             Agreement of Applicable Lenders
8.5             Liability of Agents
8.6             Notice of Default
8.7             Lenders’ Credit Decisions
8.8             Reimbursement and Indemnification
8.9             Rights of Agents
8.10             Notice of Transfer
8.11             Successor Agent
8.12             Reports and Financial Statements
8.13              Defaulting Lender
8.14              Agency for Perfection
8.15              Relation Among the Lenders
8.16             Administrative Agent
8.17             Collateral and Guaranty Matters
8.18             Syndication Agent, Documentation Agents, and Lead Arranger
9.           MISCELLANEOUS
9.1              Notices
9.2              Waivers; Amendments
9.3              Expenses; Indemnity; Damage Waiver
9.4             Designation of Lead Borrower as Borrowers’ Agent .  
9.5             Successors and Assigns
9.6              Survival
9.7              Counterparts; Integration; Effectiveness
9.8             Severability
9.9             Right of Setoff
9.10             Governing Law; Jurisdiction; Consent to Service of Process
9.11             WAIVER OF JURY TRIAL
9.12              Press Releases and Related Matters
9.13             Headings
9.14             Interest Rate Limitation
9.15             Additional Waivers
9.16             Confidentiality
9.17             Conflicts with other Loan Documents
9.18             Judgment Currency
9.19             Patriot Act; Proceeds of Crime Act .
9.20             Foreign Asset Control Regulations .  
9.21             No Advisory or Fiduciary Responsibility .
9.22               .
9.23              Existing Credit Agreement Amended and Restated


 
 
 


EXHIBITS

A            Assignment and Acceptance
B            Revolving Note
C            Perfection Certificate
D            Borrowing Base Certificate
E            Compliance Certificate
F            Notice of Borrowing
G            Form of Credit Card Notification


 
 
 

SCHEDULES

 1.1 Lenders and Commitments
 3.1 Organizational Information
 3.5(b) Title to Properties; Real Estate
 3.6 Disclosed Matters
 3.10 ERISA
 3.13 Subsidiaries
 3.14 Insurance
 3.15 Labor Matters
 3.16 Affiliate Transactions
 3.21 Intellectual Property
 3.22 Credit Card Arrangements, Blocked Account Agreements and DisbursementAccounts
4.1(c)   Foreign Qualification Terminations
 5.1(h) Financial Reporting Requirements
 6.1 Indebtedness
 6.2 Liens
 6.4 Investments
 6.6 Restrictive Agreements
   
 

 
 
 

SECOND AMENDED AND RESTATED   CREDIT AGREEMENT dated as of January 21, 2009 (this “ Agreement ”) among
 
BROWN SHOE COMPANY, INC., a corporation organized under the laws of the State of New York having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105, as Lead Borrower for the Borrowers, being
 
said BROWN SHOE COMPANY, INC.,
 
SIDNEY RICH ASSOCIATES, INC., a corporation organized under the laws of the State of Missouri having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Sidney Rich”),
 
BROWN GROUP RETAIL, INC., a corporation organized under the laws of the Commonwealth of Pennsylvania having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Brown Retail”),
 
BROWN SHOE INTERNATIONAL CORP., a corporation organized under the laws of the State of Delaware having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Brown International”),
 
BUSTER BROWN & CO., a corporation organized under the laws of the State of Missouri having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Buster Brown”),
 
            BENNETT FOOTWEAR GROUP LLC, a limited liability company organized under the laws of the State of Delaware having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Bennett”), and
 
SHOES.COM, INC., a corporation organized under the laws of the State of Delaware having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“Shoes.com”);
 
BROWN SHOE COMPANY OF CANADA LTD, a Canadian corporation having a place of business at 1857 Rogers Road, Perth, Ontario, Canada K7H 3E8, as a Loan Party but not as a Borrower (“Brown Canada”);
 
the LENDERS party hereto; and
 
BANK OF AMERICA, N.A., as Lead Issuing Bank, a national banking association having a place of business at 100 Federal Street, Boston, Massachusetts 02110; and
 
BANK OF AMERICA, N.A., as Administrative Agent and Collateral Agent for the Secured Parties, a national banking association, having a place of business at 100 Federal Street, Boston, Massachusetts 02110;  and
 
WELLS FARGO RETAIL FINANCE, LLC, as an Issuing Bank and as Syndication Agent;  and
 
BANK OF AMERICA, N.A. and JPMORGAN CHASE BANK, N.A.,  as co-Documentation Agents;
 
in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H :

WHEREAS, the Borrowers, Brown Shoe Company of Canada Ltd, the Lenders party thereto, and Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders, are party to that certain Amended and Restated Credit Agreement dated as of July 21, 2004 (as amended and in effect, the “ Existing Credit Agreement ”); and
 
WHEREAS, certain of the Lenders under the Existing Credit Agreement have assigned their rights and obligations thereunder to Persons who are, or shall become, Lenders under this Agreement; and
 
WHEREAS, the Commitments of certain Persons who are Lenders under the Existing Credit Agreement and are continuing as Lenders under this Agreement are being modified as provided herein; and
 
WHEREAS, the Borrowers, the Administrative Agent and the Lenders hereunder desire to amend and restate the Existing Credit Agreement as provided herein.
 
NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement, and for good and valuable consideration, the receipt of which is hereby acknowledged, the Lenders, the Agents, and the Borrowers hereby agree that the Existing Credit Agreement shall be amended and restated, without novation, in its entirety to read as follows:
 
1.     DEFINITIONS .       Defined Terms . As used in this Agreement, the following terms have the meanings specified below:
 
“ ACH ” shall mean the automated clearing house transfers of funds for the account of any Loan Party.
 
“ Acceptance ” means a time draft or bill of exchange relating to a Commercial Letter of Credit which has been accepted by any Acceptance Lender in its absolute discretion.
 
“ Acceptance Fees ” means the fees payable in respect of Acceptances pursuant to Section 2.15.
 
“ Acceptance Fee Percentage ” means:
 
 
Average Excess Availability
 
Applicable Percentage
 
Less than $125,000,000
 
1.625%
 
Greater than or equal to $125,000,000 but less than $250,000,000
 
1.50%
 
Greater than or equal to $250,000,000
 
1.375%

From the Closing Date through the last day of the second full Fiscal Quarter following the Closing Date (ending August 1, 2009), the Acceptance Fee Percentage shall be 1.50% per annum. The Acceptance Fee Percentage shall thereafter be adjusted quarterly upon the Administrative Agent’s furnishing the Lead Borrower with a calculation of Average Excess Availability for the immediately preceding Fiscal Quarter, which calculation shall be furnished within four (4) Business Days after the end of each Fiscal Quarter. Any such adjustment shall become effective prospectively on and after the sixth Business Day after the end of each Fiscal Quarter. If a Default or Event of Default exists at the time any reduction in the Acceptance Fee Percentage is to be implemented, such reduction shall not occur until the first day of the first calendar month following the date on which such Default or Event of Default is waived or cured, and at the option of the Administrative Agent or at the direction of the Required Lenders upon the occurrence and during the continuance of an Event of Default, the Acceptance Fee Percentage shall be set at the highest level set forth above and shall be determined in the manner set forth in Section 2.15 hereof; provided further if any Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates otherwise proves to be false or incorrect as of the date of such Borrowing Base Certificate such that the Acceptance Fee Percentage would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default or Event of Default arising as a result thereof, such Acceptance Fee Percentage due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand.

“ Acceptance Lender ” means any Lender in its capacity as an “acceptance lender” of Acceptances hereunder.
 
“ Acceptance Reimbursement Obligations ” means, at any time and without duplication, the aggregate indebtedness, liabilities, and obligations of the Borrowers to pay to any Acceptance Lender (or reimburse any Acceptance Lender for) any amount due under any Acceptance at maturity.
 
“ Accommodation Payment ” as defined in Section 9.15(c).
 
“ Account ” shall mean “accounts” as defined in the UCC, including, without limitation, all:  accounts, accounts receivable, and rights to payment (whether or not earned by performance) for: property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of; services rendered or to be rendered; a policy of insurance issued or to be issued; a secondary obligation incurred or to be incurred; arising out of the use of a credit or charge card or information contained on or used with that card.
 
“ Additional Commitment Lender ” as defined in Section 2.2(a).
 
“ Adjusted Fixed Charge Coverage Ratio ” means, as of the last day of any Fiscal Quarter of the Lead Borrower, for the preceding four Fiscal Quarters then ended, the ratio of (a) Consolidated EBITDA for such period, to (b) Adjusted Fixed Charges for such period.
 
“ Adjusted Fixed Charges ” means, for any period, as determined for the Lead Borrower and its Subsidiaries on a Consolidated basis, without duplication, the sum of (a) Consolidated Interest Expense during such period, (b) Maintenance Capital Expenditures during such period, (c) scheduled principal payments of Indebtedness payable over the course of the preceding four (4) Fiscal Quarters, (d) federal, state, local, and foreign income taxes net of refunds received, to the extent any such taxes are paid in cash during such period (excluding taxes paid to repatriate foreign earnings for fiscal periods which are more than twelve months prior to the date of determination of Adjusted Fixed Charges for any period), and (e) Restricted Payments during such period, excluding any Restricted Payments (x) consisting of dividends or distributions made in Capital Stock under clause (a) of the definition thereof and (y) permitted under Section 6.7(a)(iii)
 
“ Adjusted LIBO Rate ” means, with respect to any LIBO Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.  The Adjusted LIBO Rate will be adjusted automatically as to all LIBO Borrowings then outstanding as of the effective date of any change in the Statutory Reserve Rate.
 
“ Adjusted Net Earnings from Operations ” means, with respect to any fiscal period of the Lead Borrower, the Lead Borrower’s and its Subsidiaries’ net income after provision for income taxes for such fiscal period, excluding any and all of the following included in such net income determined on a Consolidated basis in accordance with GAAP: (a) gain or loss arising from the sale of any capital assets, (b) gain or loss arising from any write-up or write-down in the book value of any fixed or intangible assets, (c) earnings or losses of any Person (other than a Subsidiary of the Lead Borrower) in which the Lead Borrower or any consolidated Subsidiary of the Lead Borrower has an ownership interest unless (and only to the extent) any such earnings shall actually have been received by the Lead Borrower or such consolidated Subsidiary in the form of cash distributions, (d) gains or losses arising from the acquisition of debt or equity securities of the Lead Borrower or any of its Subsidiaries or from the cancellation or forgiveness of Indebtedness, (e) gains or losses arising from extraordinary items as determined in accordance with GAAP, (f) gains or losses arising from any non-recurring non-cash transactions, (g) gains or losses arising from any non-recurring cash transactions up to $5,000,000 after taxes in the aggregate in any Fiscal Year, and (h) gains and losses from the recording of share based compensation, including, without limitation, stock option expense.
 
“ Administrative Agent ” means Bank of America, N.A., in its capacity as administrative agent for the Secured Parties hereunder.
 
“ Affiliate ” means, with respect to a specified Person, (i) any other Person Controlling, Controlled by or under direct or indirect common Control with that Person, (ii) any other Person directly or indirectly holding 5% or more of any class of the Capital Stock or other equity interests (including options, warrants, convertible securities and similar rights) of that Person, (iii) any other Person 5% or more of any class of whose Capital Stock or other equity interests (including options, warrants, convertible securities and similar rights) is held directly or indirectly by that Person, and (iv) any other Person that Controls that Person.
 
“ Agents ” means collectively, the Administrative Agent and the Collateral Agent.
 
“ Agreement ” means this Second Amended and Restated   Credit Agreement, as modified, amended, supplemented or restated, and in effect from time to time.
 
“ Allocable Amount ” as defined in Section 9.15.
 
“ Applicable Commitment Fee Percentage ” means the applicable percentage set forth in the grid below:
 
Average Excess Availability in the preceding Fiscal Quarter
Applicable Commitment Fee Percentage
Less than $125,000,000
0.375%
Greater than or equal to $125,000,000 but less than $250,000,000
0.50%
Greater than or equal to $250,000,000
0.75%

 
“ Applicable Law ” means as to any Person: (i) all statutes, rules, regulations, orders, or other requirements having the force of law and (ii) all court orders, judgments and injunctions, and/or similar rulings, in each instance ((i) and (ii)) of or by any Governmental Authority, or court, or tribunal which are applicable to such Person, or any property of such Person.
 
“ Applicable Lenders ” means the Required Lenders or all Lenders, as applicable.
 
“ Applicable Margin ” means the applicable percentage for Prime Rate Loans and LIBO Loans set forth below:
 
 
Level
 
Average Excess Availability
 
Prime Rate Loans
 
LIBO Loans
 
I
 
Less than $125,000,000
 
3.25%
 
3.25%
 
II
 
Greater than or equal to $125,000,000 but less than $250,000,000
 
3.00%
 
3.00%
 
III
 
Greater than or equal to $250,000,000
 
2.75%
 
2.75%

Except as provided below, the Applicable Margin shall be adjusted upon the Administrative Agent’s furnishing the Lead Borrower with a calculation of Average Excess Availability for the immediately preceding Fiscal Quarter, which calculation shall be furnished within four (4) Business Days after the end of each Fiscal Quarter. Any such adjustment shall become effective prospectively on and after the sixth Business Day after the end of each Fiscal Quarter. Notwithstanding the foregoing, the Applicable Margin shall be based on Level II through the last day of the second full Fiscal Quarter following the Closing Date (ending August 1, 2009). Upon the occurrence and during the continuance of an Event of Default, at the option of the Administrative Agent or at the direction of the Required Lenders, interest shall accrue at Level I and shall be determined in the manner set forth in Section 2.11; provided further if any Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates otherwise proves to be false or incorrect as of the date of such Borrowing Base Certificate such that the Applicable Margin would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default or Event of Default arising as a result thereof, interest due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand.
 
“ Appraisal Percentage ” means 85%.
 
“ Appraised Value Percentage ” means with respect to Inventory of any Loan Party, the orderly liquidation value thereof (expressed as a percentage of the Cost of such Inventory) as determined from time to time (and updated at least once in each calendar year) in a manner acceptable to the Administrative Agent by an experienced and reputable independent appraiser acceptable to the Administrative Agent, net of all costs of liquidation thereof.
 
“ Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
 
“ Assignment and Acceptance ” means an assignment and acceptance entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 9.5), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
 
“ Availability Reserves ” means, without duplication of any other Reserves or items that are otherwise addressed or excluded through eligibility criteria or in the most recently conducted appraisal, such reserves as the Administrative Agent from time to time determines in the Administrative Agent’s Permitted Discretion (after consultation with the Lead Borrower (whose consent to any Availability Reserve shall not be required)) as being appropriate (a) to reflect the impediments to the Collateral Agent’s ability to realize upon the Collateral, (b) to reflect claims and liabilities that the Administrative Agent determines will need to be satisfied in connection with the realization upon the Collateral, (c) to reflect criteria, events, conditions, contingencies or risks which adversely affect any component of the Borrowing Base, or the assets, business, financial performance or financial condition of any Loan Party, or (d) to reflect that a Default or an Event of Default then exists. Without limiting the generality of the foregoing, in the Administrative Agent’s Permitted Discretion, Availability Reserves may include (but are not limited to) (i) reserves for rent at leased locations; (ii) reserves based on Customer Credit Liabilities; (iii) reserves for customs, duties, and other costs to release Inventory which is being imported into the United States of America; (iv) reserves for outstanding taxes and other governmental charges, including, ad valorem, real estate, personal property, and other taxes which might have priority over the interests of the Collateral Agent in the Collateral; (v) reserves for accrued, unpaid interest on the Obligations; (vi) reserves for salaries, wages and benefits due to employees of any Borrower; (vii) reserves for warehouseman’s or bailee’s charges; (viii) Bank Products Reserves; (ix) Cash Management Reserves; (x) reserves for reasonably anticipated changes in appraised value of Inventory between appraisals; and (xi) reserves for amounts secured by any Liens, choate or inchoate, which rank or are capable of ranking in priority to the Collateral Agent’s and/or Lenders’ Liens and/or for amounts which may represent costs relating to the enforcement of the Collateral Agent’s Liens including, without limitation, in the good faith credit discretion of the Administrative Agent, any such amounts due and not paid for vacation pay, wages, amounts due and not paid under any legislation relating to workers’ compensation or to employment insurance, all amounts deducted or withheld and not paid and remitted when due under the Income Tax Act (Canada), amounts currently or past due and not paid for realty, municipal or similar taxes (to the extent impacting personal or moveable property) and all amounts currently or past due and not contributed, remitted or paid to any Plan or under the Canada Pension Plan, the Pension Benefits Act (Ontario) or any similar statutes.  Availability Reserves shall be established and calculated in a manner and methodology consistent with the Administrative Agent’s practices with the Loan Parties as of the Closing Date, provided that in establishing and calculating any such Availability Reserves, the Administrative Agent may take into account changes to the Loan Parties’ business after the Closing Date, and provided further , however, that if (x) an Event of Default exists, (y) any of the conditions described in clauses (ii) and (iii) of the first sentence of the definition of “Permitted Discretion” apply, or (z) any factor or circumstance described in clause (D) of the second sentence of the definition of “Permitted Discretion” exists, then Availability Reserves may be established and calculated in a manner and methodology consistent with the Administrative Agent’s practices as of the Closing Date with other similarly situated borrowers.  The Availability Reserves in effect on the Closing Date are reflected on the Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 4.1(d) hereof.
 
“ Average Excess Availability ” means, the average daily Excess Availability for the immediately preceding Fiscal Quarter.  The Administrative Agent shall provide the Lead Borrower with a calculation of Average Excess Availability on the fourth Business Day of each Fiscal Quarter for the immediately preceding Fiscal Quarter  upon request of the Lead Borrower, or alternatively, give the Lead Borrower electronic access to the Administrative Agent’s systems to the extent necessary to provide such information.
 
“ B&H ” means B&H Footwear Company Limited, a Hong Kong corporation and a joint venture between a Subsidiary of the Lead Borrower and an unrelated third party.
 
“ Bank of America ” means Bank of America, N.A., a national banking association.
 
“ Bank Products ” means one or more of the following types of services or facilities provided to any Loan Party by any Lender or any of its Affiliates: (a) Hedging Agreements, (b) purchase cards and (c) leasing, but excluding Cash Management Services.
 
“ Bank Product Reserves ” means such reserves as the Administrative Agent from time to time determine in its Permitted Discretion as being appropriate to reflect the liabilities and obligations of the Loan Parties with respect to Bank Products then provided or outstanding.
 
“ Bankruptcy Code ” means Title 11 of the United States Code (11 U.S.C.  Section 101 et seq.) as now or hereafter in effect, or any successor thereto and (ii) the Bankruptcy and Insolvency Act (Canada), the Companies' Creditors Arrangement Act (Canada) and the Winding-up Act (Canada), as now or hereafter in effect, or any successor thereto.
 
“ Bennett ” has the meaning provided therefor in the Recitals.
 
“ Blocked Account Agreements ” means agency agreements with the banks maintaining deposit accounts of any of the Loan Parties where funds from one or more DDAs are concentrated, which agreements shall be in form and substance reasonably satisfactory to the Administrative Agent.
 
“ Blocked Account Banks ” means (i) Bank of America, and (ii) each other bank with whom the Loan Parties have entered into Blocked Account Agreements.
 
“ Blocked Accounts ” means each deposit account of the Loan Parties which is the subject of a Blocked Account Agreement or is maintained with Bank of America.
 
“ Board ” means the Board of Governors of the Federal Reserve System of the United States of America.
 
“ Borrowers ” means, individually and collectively, the Lead Borrower, Sidney Rich, Brown Retail, Brown International, Buster Brown, Bennett, Shoes.com, and any other Person which becomes a “Borrower” in accordance with the provisions of this Agreement.
 
“ Borrowing ” means (a) the incurrence of Loans of a single Type, on a single date and having, in the case of LIBO Loans, a single Interest Period, or (b) a Swingline Loan.
 
“ Borrowing Base ” means, at any time of calculation, an amount equal to:
 
(a)           (i) an amount equal to (A) the Appraised Value Percentage of Eligible Inventory, multiplied by (B) an amount equal to (x) the Cost of such Eligible Inventory, minus (y) Inventory Reserves, multiplied by (ii) the Appraisal Percentage; plus
 
(b)           with respect to any Eligible Letter of Credit, (i) an amount equal to (A) the Appraised Value Percentage of the Inventory supported by such Eligible Letter of Credit, multiplied by (B) an amount equal to (x) the Cost of such Inventory when completed, minus (y) Inventory Reserves, multiplied by (ii) the Appraisal Percentage; plus
 
(c)           ninety percent (90%) of the Net Amount of Eligible Credit Card Receivables; plus
 
(d)           eighty-five percent (85%) of the Net Amount of Eligible Accounts; minus
 
(e)           the then amount of all Availability Reserves.
 
“ Borrowing Base Certificate ” has the meaning assigned to such term in Section 5.1(f).
 
“ Borrowing Request ” means a request by the Lead Borrower on behalf of the Borrowers for a Borrowing in accordance with Section 2.4.
 
“ Borrower Security Agreement ” means the Amended and Restated Security Agreement dated as of July 21, 2004 and executed and delivered by the Borrowers to the Collateral Agent for the benefit of the Secured Parties, as amended and in effect from time to time.
 
“ Breakage Costs ” has the meaning set forth in Section 2.21(b).
 
“ Brown Canada ” has the meaning provided therefor in the Recitals.
 
“ Brown International ” has the meaning provided therefor in the Recitals.
 
“ Brown Retail ” has the meaning provided therefor in the Recitals.
 
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in Boston, Massachusetts are authorized or required by law to remain closed, provided that, when used in connection with a LIBO Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.
 
“ Buster Brown ” has the meaning provided therefor in the Recitals.
 
“ Canadian Guaranty ” means the Amended and Restated Canadian Facility Guaranty, dated as of July 21, 2004 and executed and delivered by Brown Canada to the Collateral Agent for the benefit of the Secured Parties, as amended and in effect from time to time.
 
“ Canadian Pension Plans ” means collectively, (i) The Pension Plan for the Salaried Staff and Salespersons of Brown Shoe Company of Canada Ltd and (ii) The Pension Plan for the Designated Employees of Brown Shoe Company of Canada Ltd.
 
“ Canadian Security Agreements ” means the Amended and Restated Canadian Security Agreement and the Amended and Restated Deed of Moveable Hypothec, each dated as of July 21, 2004 and executed and delivered by Brown Canada to the Collateral Agent for the benefit of the Secured Parties, as amended and in effect from time to time.
 
“ Canadian Subsidiary ” means any Subsidiary that is organized under the laws of Canada or any province thereof.
 
“ Capital Expenditures ” means, with respect to any Person for any period, (a) all expenditures made (whether made in the form of cash or other property) or costs incurred for the acquisition, improvement or repair of fixed or capital assets of such Person (but excluding any asset acquired (x) in connection with a Permitted Acquisition, or (y) with the proceeds of insurance or condemnation awards), in each case that are (or should be) set forth as capital expenditures in a Consolidated statement of cash flows of such Person for such period, in each case prepared in accordance with GAAP, and (b) Capital Lease Obligations incurred by a Person during such period to the extent capitalized in accordance with GAAP.
 
“ Capital Lease Obligations ” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.
 
“ Capital Stock ” means with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.
 
“ Cash Collateral Account ” means an interest-bearing account established by the Borrowers with the Collateral Agent at Bank of America under the sole and exclusive dominion and control of the Collateral Agent designated as the “Brown Shoe Cash Collateral Account”.
 
“ Cash Dominion Event ” means either (i) the occurrence and continuance of any Event of Default, or (ii) the failure of the Borrowers to maintain for three (3) consecutive Business Days Excess Availability of at least the greater of (A) seventeen and one-half (17.5%) percent of the lesser of (x) the then Borrowing Base or (y) the then Total Commitments and (B) $25,000,000.  For purposes of this Agreement, the occurrence of a Cash Dominion Event shall be deemed continuing (i) so long as such Event of Default has not been cured or waived, and/or (ii) if the Cash Dominion Event arises as a result of the Borrowers’ failure to maintain Excess Availability as required hereunder, until Excess Availability has exceeded the greater of (i) seventeen and one-half (17.5%) percent of the lesser of (x) the then Borrowing Base or (y) the then Total Commitments and (ii) $25,000,000 for thirty (30) consecutive calendar days, in which case a Cash Dominion Event shall no longer be deemed to be continuing for purposes of this Agreement; provided that a Cash Dominion Event shall be deemed continuing (even if an Event of Default is no longer continuing and/or Excess Availability exceeds the required amount for thirty (30) consecutive Business Days) after a Cash Dominion Event has occurred and been discontinued on two (2) occasions in any twelve (12) month period; provided further that such Cash Dominion Event shall terminate on the date that is twelve months after the date of the first discontinuance described in the foregoing proviso but only if on such date an Event of Default is no longer continuing and/or Excess Availability exceeds the required amount for thirty (30) consecutive Business Days (without limiting the Administrative Agent’s right to assert the existence of a Cash Dominion Event thereafter).
 
“ Cash Management Reserves ” means such reserves as the Administrative Agent, from time to time, determines in its Permitted Discretion as being appropriate to reflect the reasonably anticipated liabilities and obligations of the Loan Parties with respect to Cash Management Services then provided or outstanding.
 
“ Cash Management Services ” means any one or more of the following types or services or facilities provided to any Loan Party by any Lender or any of its Affiliates: (a) ACH transactions, (b) other cash management services, including, without limitation, controlled disbursement services, treasury, depository, overdraft, and electronic funds transfer services, (c) foreign exchange facilities, (d) credit card processing services, and (e) credit or debit cards.
 
“ Cash Receipts ” has the meaning provided therefor in Section 2.23(b).
 
“ CERCLA ” means the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq.
 
“ Change in Control ” means, at any time, (a) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Lead Borrower by Persons who were neither (i) nominated by the board of directors of the Lead Borrower nor (ii) appointed by directors so nominated; or (b) any person (within the meaning of the Securities and Exchange Act of 1934, as amended), which is or becomes the beneficial owner (within the meaning of Rule 13d-3 and 13d-5 of the Securities and Exchange Act of 1934, as amended) directly or indirectly of fifty percent (50%) or more of the total voting power of the Voting Stock of the Lead Borrower on a fully diluted basis, whether as a result of the issuance of securities of the Lead Borrower, any merger, consolidation, sale, or distribution, or otherwise, or (c) the failure of the Lead Borrower to own, directly or indirectly, 100% (or such lesser percentage as may be owned directly or indirectly, as of the Closing Date or as of the later acquisition thereof) of the Capital Stock or ownership interest, as applicable, of all other Loan Parties (other than Shoes.com), except where such failure is as a result of a transaction permitted by the Loan Documents; or (d) the failure of the Lead Borrower to own, directly or indirectly, 80% of the Capital Stock or ownership interest, as applicable, of Shoes.com, except where such failure is as a result of a transaction permitted by the Loan Documents; or (e) any “change in control” or similar event however defined in any documents governing Material Indebtedness of any Loan Party.
 
“ Change in Law ” means (a) the adoption of any law, rule or regulation after the Relevant Date, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the Relevant Date or (c) compliance by any Lender, Issuing Bank or Acceptance Lender (or, for purposes of Section 2.25, by any lending office of such Lender, Issuing Bank or Acceptance Lender or by such Lender’s, Issuing Bank’s or Acceptance Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Relevant Date.
 
“ Charges ” has the meaning provided therefor in Section 9.14.
 
“ Charter Document ” means as to any Person, its partnership agreement, certificate or articles of incorporation, operating agreement, membership agreement or similar constitutive document or agreement, its by-laws and all shareholder or other equity holder agreements, voting trusts and similar arrangements to which such Person is a party or which is applicable to its Capital Stock, its partnership interests, membership interests or other equity interests and all other arrangements relating to the Control or management of such Person.
 
“ Civil Code ” means the Civil Code of Quebec and all regulations thereunder, as amended from time to time, and any successor statutes.
 
“ Closing Date ” means the date on which the conditions specified in Section 4.1 are satisfied (or waived by the Administrative Agent).
 
“ Code ” means the Internal Revenue Code of 1986 and the rules and regulations promulgated thereunder, as amended from time to time.
 
“ Collateral ” means any and all “Collateral” as defined in any applicable Security Document.
 
“ Collateral Agent ” means Bank of America, N.A., in its capacity as collateral agent under the Security Documents.
 
“ Commercial Letter of Credit ” means any Letter of Credit issued for the purpose of providing the primary payment mechanism in connection with the purchase of any materials, goods or services by a Borrower in the ordinary course of business of such Borrower.
 
“ Commercial Letter of Credit Fee ” means with respect to any Commercial Letter of Credit issued hereunder and the Existing Letters of Credit which are Commercial Letters of Credit, the applicable percentage specified corresponding to the Average Excess Availability, as set forth below, respectively, in each case subject to adjustment from time to time thereafter:
 
Average Excess Availability
Fee
Less $125,000,000
1.625%
Greater than or equal to $125,000,000 but less than $250,000,000
1.50%
Greater than or equal to $250,000,000
1.375%

 
From the Closing Date through the last day of the second full Fiscal Quarter following the Closing Date (ending August 1, 2009), the Commercial Letter of Credit Fee shall be shall be 1.50% per annum. The Commercial Letter of Credit Fee Percentage shall thereafter be adjusted quarterly upon the Administrative Agent’s furnishing the Lead Borrower with a calculation of Average Excess Availability for the immediately preceding Fiscal Quarter, which calculation shall be furnished within four (4) Business Days after the end of each Fiscal Quarter. Any such adjustment shall become effective prospectively on and after the sixth Business Day after the end of each Fiscal Quarter.  If a Default or Event of Default exists at the time any reduction in the Commercial Letter of Credit Fee is to be implemented, such reduction shall not occur until the first day of the first calendar month following the date on which such Default or Event of Default is waived or cured, and at the option of the Administrative Agent or at the direction of the Required Lenders upon the occurrence and during the continuance of an Event of Default, the Commercial Letter of Credit Fee shall be set at the highest level set forth above and shall be determined in the manner set forth in Section 2.14(a)(iii) hereof; provided further if any Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates otherwise proves to be false or incorrect as of the date of such Borrowing Base Certificate such that the Commercial Letter of Credit Fee would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default or Event of Default arising as a result thereof, such Commercial Letter of Credit Fee due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand.
 
“ Commitment ” means, with respect to each Lender, the commitment of such Lender hereunder in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be either (i) reduced from time to time pursuant to Section 2.17 hereof, or (ii) increased from time to time pursuant to Section 2.2 hereof.
 
“ Commitment Fee ” has the meaning provided therefor in Section 2.13.
 
“ Commitment Increase ” has the meaning provided therefor in Section 2.2(a).
 
“ Commitment Percentage ” means, with respect to each Lender, that percentage of the Commitments of all Lenders hereunder in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be either (i) reduced from time to time pursuant to Section 2.17 hereof, or (ii) increased or reduced from time to time pursuant to Section 2.2 hereof.
 
“ Compliance Certificate ” has the meaning provided in Section 5.01(d).
 
“ Concentration Account ” has the meaning provided therefor in Section 2.23(a).
 
“ Confirmation Agreement ” means that certain Confirmation, Ratification and Amendment of Ancillary Loan Documents dated as of the date hereof by and among the Loan Parties and the Agents.
 
“ Consolidated ” means, when used to modify a financial term, test, statement, or report of a Person, refers to the application or preparation of such term, test, statement or report (as applicable) based upon the consolidation, in accordance with GAAP, of the financial condition or operating results of such Person and its Subsidiaries.
 
“ Consolidated EBITDA ” means with respect to any Fiscal Period of the Lead Borrower, the result for such period of (i) Adjusted Net Earnings from Operations, plus (ii) depreciation, amortization and all other non-cash charges that were deducted in the calculation of Adjusted Net Earnings from Operations for such period plus (iii) federal, state, local and foreign income taxes that were deducted in the calculation of Adjusted Net Earnings from Operations for such period, plus (iv) Consolidated Interest Expense to the extent deducted in the calculation of Adjusted Net Earnings from Operations for such period, in each case determined on a Consolidated basis in accordance with GAAP.
 
“ Consolidated Interest Expense ” means, for any period for any Person, interest expense of such Person for such period, determined on a Consolidated basis in accordance with GAAP.
 
“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “ Controlling ” and “ Controlled ” have meanings correlative thereto.
 
“ Cost ” means, with respect to Inventory, the lower of cost (on a first-in, first-out basis) or market value, as reported on the Borrowers’ inventory records and in a manner consistent with current practice.
 
“ Credit Card Notifications ” has the meaning provided therefor in Section 2.23(d).
 
“ Credit Card Receivables ” means each Account together with all income, payments and proceeds thereof, owed by a major credit or debit card issuer (including, but not limited to, Visa, Mastercard, American Express, JCB, Paypal, BillMeLater and Discover and such other issuers approved by the Administrative Agent) to a Loan Party resulting from charges by a customer of a Loan Party on credit or debit cards issued by such issuer in connection with the sale of goods by a Loan Party, or services performed by a Loan Party, in each case in the ordinary course of its business.
 
“ Credit Exposure ” has the meaning set forth in Section 8.13.
 
“ Credit Extensions ” as of any day, shall be equal to the sum of (a) the principal balance of all Loans then outstanding, (b) the then amount of the Letter of Credit Outstandings and (c) the aggregate amount of any unpaid Acceptance Reimbursement Obligations, whether or not then due.
 
“ Customer Credit Liabilities ” means, at any time, the aggregate face value at such time of (a) outstanding gift certificates and gift cards of the Loan Parties entitling the holder thereof to use all or a portion of the certificate to pay all or a portion of the purchase price for any Inventory, and (b) outstanding merchandise credits and customer deposits of the Loan Parties.
 
“ DDAs ” means any checking or other demand deposit account maintained by any Loan Party.
 
“ Default ” means any event or condition that constitutes an Event of Default or that upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
 
“ Defaulting Lender ” means any Lender, as determined by the Administrative Agent, (i) that has failed or refused to abide by its obligations under this Agreement, including without limitation, its obligation to make available to Administrative Agent its Commitment Percentage of any Revolving Loans, expenses or setoff or purchase its pro rata share of a participation interest in the Swingline Loans and Letters of Credit, (ii) that has otherwise failed to pay over to the Administrative Agent any other amount required to be paid by it hereunder within two (2) days of receipt from the Administrative Agent of written notice thereof, (iii) that has notified any Borrower, the Administrative Agent, any Issuing Bank, the Swingline Lender or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under other agreements in which it commits to extend credit, (iv) as to which the Administrative Agent, Swingline Lender or Lead Issuing Bank has a good faith belief that such Lender has defaulted in fulfilling its obligations under one or more other syndicated credit facilities, or (v) which has (a) become or is insolvent or a Person that Controls such Lender has become or is insolvent or (b) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, interim receiver, receiver and manager, administrator, liquidator, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or a Person that Controls such Lender has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, interim receiver, receiver and manager, administrator, liquidator, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment.

“ Designated Disposition ” means the sale, transfer, lease or other disposition by a Loan Party of any one or more of the following: (i) any item of Real Estate owned by a Loan Party and located in Canada as identified on Schedule 3.5 hereto, and (ii) the Real Estate owned by the Lead Borrower located in Sikeston, Missouri and Fredericktown, Missouri and used as warehouses.
 
“ Disbursement Accounts ” has the meaning provided therefor in Section 2.23(a).
 
“ Disqualified Stock ” means any Capital Stock of any Person that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, in each case prior to the Termination Date.
 
“ Dollar Equivalent ” of an amount denominated in currency other than Dollars shall mean, at any time for the determination thereof, the amount of Dollars which could be purchased with the amount of such other currency involved in such computation at the spot exchange rate therefor as quoted by the Agent as of 11:00 A.M. (Boston time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.
 
“ Dollars ” or “ $ ” refers to lawful money of the United States of America.
 
“ Domestic Subsidiary ” means any Subsidiary that is organized under the laws of the United States of America or any state thereof or the District of Columbia.
 
“ Earn-Out Obligations ” means any contingent consideration payable to the seller in connection with a Permitted Acquisition based on future operating performance of the acquired Person or assets or other purchase price adjustment or indemnification obligation payable following the consummation of such Permitted Acquisition based on criteria set forth in the documentation governing or relating to such Permitted Acquisition.
 
“ Edelman ” means Edelman Shoe, Inc.
 
“ Edelman Acquisition ” has the meaning provided therefor in the definition of “Permitted Acquisition”.
 
“ EDGAR ” means the Electronic Data Gathering, Analysis and Retrieval system maintained by the Securities and Exchange Commission.
 
“ Eligible Accounts ” means Accounts (other than Credit Card Receivables) due to a Loan Party as arise in the ordinary course of business, which have been earned by performance, and are deemed by the Administrative Agent in its reasonable discretion  to be eligible for inclusion in the calculation of the Borrowing Base. Without limiting the foregoing, unless otherwise approved in writing by the Administrative Agent, none of the following shall be deemed to be Eligible Accounts:
 
(a)           Accounts that have been outstanding for more than ninety (90) days past the invoice date or that are more than sixty (60) days past due; provided that Eligible Accounts may include up to $3,000,000 of Accounts for which more than ninety (90) days but less than one hundred twenty (120) days have elapsed since the date of the original invoice therefor, but which are less than sixty (60) days past due, in the ordinary course of the Loan Parties’ business and provided further that Eligible Accounts may include Accounts of major department stores, including, without limitation, Macy’s, Dillards and Nordstrom, for which more than one hundred twenty (120) days but less than one hundred forty-five days (145) have elapsed since the date of the original invoice therefor, but which are less than sixty (60) days past due, in the ordinary course of the Loan Parties’ business;
 
(b)           Accounts due from any Person to the extent that fifty percent (50%) or more of all Accounts from such Person are not Eligible Accounts pursuant to the other provisions of this definition;
 
(c)           Accounts with respect to which a Loan Party does not have good, valid and marketable title thereto, free and clear of any Lien (other than Liens granted to the Collateral Agent, for its benefit and the ratable benefit of the Secured Parties, pursuant to the Security Documents);
 
(d)           Accounts that are not subject to a first priority security interest in favor of the Collateral Agent, for the benefit of itself and the Secured Parties;
 
 (e)           Accounts with respect to which any of the representations, warranties, covenants and agreements contained in any Loan Document are incorrect or have been breached;
 
(f)           Accounts with respect to which a check, promissory note, draft, trade acceptance, or other instrument for the payment of money has been received, presented for payment and returned uncollected for any reason;
 
(g)           Accounts which represent a progress billing or as to which the applicable Loan Party has extended the time for payment without the consent of the Administrative Agent (for the purposes hereof, “progress billing” means any invoice for goods sold or leased or services rendered under a contract or agreement pursuant to such the obligation to pay such invoice is conditioned upon such Loan Party’s completion of any further performance under such contract or agreement);
 
(h)           Accounts with respect to which any one or more of the following events has occurred to the account debtor on such Account:  (i) death or judicial declaration of incompetency of such account debtor who is a natural person; (ii) the filing by or against such account debtor of a request, proposal or petition for liquidation, reorganization, arrangement, adjustment of debts, adjudication as a bankrupt, winding-up, or other relief under the Bankruptcy Code or other similar Applicable Law of any jurisdiction or any other bankruptcy, insolvency, or similar laws of the United States of America or Canada, any state, province or territory thereof, or any foreign jurisdiction, now or hereafter in effect; (iii) the making of any general assignment for the benefit of creditors by such account debtor; (iv) the appointment of a receiver or trustee for such account debtor or for any of the assets of the account debtor, including, without limitation, the appointment of or taking possession by a “custodian,” as defined in the Bankruptcy Code; (v) the institution by or against such account debtor of any other type of insolvency proceeding (under the Bankruptcy Code or other similar Applicable Law of any jurisdiction or otherwise) or of any formal or informal proceeding for the dissolution or liquidation of, settlement of claims against, or winding up of affairs of, such account debtor; (vi) the sale, assignment, or transfer of all or any material part of the assets of such account debtor; (vii) the nonpayment generally by such account debtor of its debts as they become due; or (viii) the cessation of the business of such account debtor as a going concern;
 
(i)           Accounts owed by a Person which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America or Canada or any political subdivision, state, or province thereof, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality, or other political subdivision thereof, or of any department, agency, public corporation, or other instrumentality thereof, except to the extent that such Account is secured or payable by a letter of credit or acceptance satisfactory to the Administrative Agent in its discretion;
 
(j)           Accounts owed by a Person which is an Affiliate (other than, prior to the time a Loan Party or any of its Subsidiaries exercises Control of Edelman, Accounts owed by Edelman which arise in the ordinary course of business and on terms and conditions not less favorable to the Loan Parties than could be obtained on an arm’s-length basis from unrelated third parties), director, officer, or employee of such Loan Party;
 
(k)           Accounts with respect to which either the perfection, enforceability, or validity of the Collateral Agent’s Liens in such Account, or the Collateral Agent’s right or ability to obtain direct payment to the Collateral Agent of the proceeds of such Account, is governed by any federal, state, provincial or local statutory requirements other than those of the UCC, PPSA, Civil Code, or the Mortgages Act (Ontario) (except as provided in clause (m) following);
 
(l)           Accounts owed by a Person to which a Loan Party, is indebted in any way, or which is subject to any right of setoff or recoupment by such Person, unless such Person has entered into an agreement reasonably acceptable to the Administrative Agent to waive setoff rights, or as to which such Person has disputed liability or made any claim with respect to any other Account due from such Person, but in each such case only to the extent of such indebtedness, setoff, recoupment, dispute, or claim;
 
(m)           Accounts owed by the government of the United States of America or Canada, or any department, agency, public corporation, or other instrumentality thereof, unless, in the case of the United States of America, the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. 3727 et seq.), and any other steps necessary to perfect the Agent’s Liens therein, have been complied with to the Administrative Agent’s satisfaction with respect to such Account;
 
(n)           Accounts owed by any state, province, municipality, or other political subdivision of the United States of America or any other government, country or jurisdiction, or any department, agency, public corporation, or other instrumentality thereof and as to which the Administrative Agent determines that its Lien therein is not or cannot be perfected;
 
(o)           Accounts which represent a sale on a bill-and-hold, guaranteed sale, sale and return, sale on approval, consignment (other than with respect to consignments to Bloomingdales, Inc. and/or QVC in an aggregate amount not to exceed $2,000,000), or other repurchase or return (excluding sales subject to returns of defective merchandise returned in the ordinary course of business) basis;
 
(p)           Accounts owed by trade vendors in connection with marketing and advertising costs expended by a Loan Party;
 
(q)           Accounts which are evidenced by a promissory note or other instrument or by chattel paper;
 
(r)           Accounts with respect to which the account debtor is located in any state requiring the filing of a Notice of Business Activities Report or similar report in order to permit such Loan Party to seek judicial enforcement in such state of payment of such Account, unless such Loan Party has qualified to do business in such state or has filed a Notice of Business Activities Report or equivalent report for the then current year;
 
(s)           Accounts which arise out of a sale not made in the ordinary course of such Loan Party’s business;
 
(t)           Accounts with respect to which the goods giving rise to such Account have not been shipped and delivered to and accepted by, or have been rejected or objected to by, the account debtor or the services giving rise to such Account have not been performed by such Loan Party, and, if applicable, accepted by the account debtor, or the account debtor revokes its acceptance of such goods or services;
 
(u)           Accounts owed by a Person, or group of affiliated Persons, which is obligated to the Loan Parties respecting Accounts the aggregate unpaid balance of which exceeds twenty-five percent (25%) of the aggregate unpaid balance of all Accounts owed to the Loan Parties at such time by all of the Loan Parties’ account debtors, but only to the extent of such excess; provided that, for purposes of this clause (u), all Accounts due from Macy’s shall, subject to the other provisions of this definition, be included as Eligible Accounts notwithstanding the aggregate of such Accounts exceeds the foregoing limitation as long as the debt rating for Macy’s by S&P (or any successor thereto) is BBB- or better; provided further , if S&P no longer provides such rating, the debt rating for Macy’s by Moody’s Investor Service, Inc. (or any successor thereto) is  Baa3 or better;
 
(v)           Accounts with respect to which such Loan Party or the Administrative Agent has, in the exercise of the Administrative Agent’s reasonable credit judgment after consultation with the Lead Borrower, deemed such Account as uncollectible or has any reason to believe that such Account is uncollectible; and
 
(w)           Accounts which the Administrative Agent determines in its reasonable credit judgment is ineligible for any other reason.
 
If any Account at any time ceases to be an Eligible Account, then such Account shall promptly be excluded from the calculation of the Borrowing Base.
 
“ Eligible Assignee ” means (a) a commercial bank, commercial finance company, or other asset based lender having total assets in excess of $1,000,000,000, (b) any Lender listed on the signature pages of this Agreement, (c) any Affiliate of any Lender, (d) an Approved Fund, and (e) if an Event of Default has occurred and is continuing, any Person reasonably acceptable to the Administrative Agent; provided that , notwithstanding the foregoing, “Eligible Assignee” shall not include a Loan Party or any of the Loan Parties’ Affiliates or Subsidiaries.
 
“ Eligible Credit Card Receivables ” means at the time of any determination thereof, each Credit Card Receivable that satisfies the following criteria at the time of creation and continues to meet such criteria at the time of such determination: such Credit Card Receivable (i) has been earned by performance and represents the bona fide amounts due to a Loan Party from a credit card payment processor and/or credit card issuer, and in each case is originated in the ordinary course of business of such Loan Party, and (ii) in each case is deemed by the Administrative Agent in its reasonable discretion  to be eligible for inclusion in the calculation of the Borrowing Base. Without limiting the foregoing, to qualify as an Eligible Credit Card Receivable, an Account shall indicate no Person other than a Loan Party as payee or remittance party.  Without limiting the foregoing, unless otherwise approved in writing by the Administrative Agent, none of the following shall be deemed to be Eligible Credit Card Receivables:
 
 
(a)
Credit Card Receivables which do not constitute “Accounts” (as defined herein);
 
 
(b)
Credit Card Receivables that have been outstanding for more than five (5) Business Days from the date of sale;
 
 
(c)
Credit Card Receivables with respect to which a Loan Party does not have good, valid and marketable title thereto, free and clear of any Lien (other than Liens granted to the Collateral Agent, for its benefit and the ratable benefit of the Secured Parties, pursuant to the Security Documents);
 
 
(d)
Credit Card Receivables that are not subject to a first priority security interest in favor of the Collateral Agent, for its benefit and the ratable benefit of the Secured Parties (it being the intent that chargebacks in the ordinary course by such processors shall not be deemed violative of this clause);
 
 
(e)
Credit Card Receivables which are disputed, are with recourse to a Loan Party, or with respect to which a claim, counterclaim, right of setoff, recoupment or chargeback has been asserted, unless such Person has entered into an agreement reasonably acceptable to the Administrative Agent to waive setoff rights, but in each such case only to the extent of such claim, counterclaim, right of setoff, recoupment or chargeback, it being understood that for purposes of this clause (e), “with recourse” means solely that the applicable Loan Party is liable to the relevant credit card processor in the event that the credit cardholder fails to pay his or her credit card bill;
 
 
(f)
Credit Card Receivables as to which the processor has the right under certain circumstances to require a Loan Party to repurchase such Credit Card Receivables from such credit card processor;
 
 
(g)
Credit Card Receivables with respect to which any one or more of the following events has occurred to the issuer or payment processor of the applicable credit card:  (i)  the filing by or against such issuer or payment processor of a request, proposal or petition for liquidation, reorganization, arrangement, adjustment of debts, adjudication as a bankrupt, winding-up, or other relief under the Bankruptcy Code or other similar Applicable Law of any jurisdiction or any other bankruptcy, insolvency, or similar laws of the United States of America or Canada, any state, province or territory thereof, or any foreign jurisdiction, now or hereafter in effect; (ii) the making of any general assignment for the benefit of creditors by such issuer or payment processor; (iii) the appointment of a receiver or trustee for such issuer or payment processor or for any of the assets of the issuer or payment processor, including, without limitation, the appointment of or taking possession by a “custodian,” as defined in the Bankruptcy Code; (iv) the institution by or against such issuer or payment processor of any other type of insolvency proceeding (under the Bankruptcy Code or other similar Applicable Law of any jurisdiction or otherwise) or of any formal or informal proceeding for the dissolution or liquidation of, settlement of claims against, or winding up of affairs of, such issuer or payment processor; (v) the sale, assignment, or transfer of all or any material part of the assets of such issuer or payment processor; (vi) the nonpayment generally by such issuer or payment processor of its debts as they become due; or (vii) the cessation of the business of such issuer or payment processor as a going;
 
 
(h)
Credit Card Receivables with respect to which either the perfection, enforceability, or validity of the Collateral Agent’s Liens in such Credit Card Receivables, or the Collateral Agent’s right or ability to obtain direct payment to the Collateral Agent of the proceeds of such Credit Card Receivables, is governed by any federal, state, provincial or local statutory requirements other than those of the UCC, PPSA, Civil Code, or the Mortgages Act (Ontario);
 
 
(i)
Credit Card Receivables which are not valid, legally enforceable obligations of the applicable issuer with respect thereto;
 
 
(j)
Credit Card Receivables which do not conform to all representations, warranties or other provisions in the Loan Documents relating to Credit Card Receivables;
 
 
(k)
Credit Card Receivables which are evidenced by a promissory note or other instrument or by chattel paper;
 
 
(l)
Credit Card Receivables with respect to which such Loan Party or the Administrative Agent has, in the Administrative Agent’s reasonable credit judgment, deemed such Credit Card Receivables as uncollectible or has any reason to believe that such Credit Card Receivables are uncollectible; and
 
 
(m)
Credit Card Receivables which the Administrative Agent determines in its reasonable credit judgment is ineligible for any other reason.
 
If any Credit Card Receivable at any time ceases to be an Eligible Credit Card Receivable, then such Credit Card Receivable shall promptly be excluded from the calculation of the Borrowing Base.

“ Eligible In-Transit Inventory ” means, as of the date of determination thereof, without duplication of other Eligible Inventory, Inventory:
 
 (a) (i) which has been shipped from a location within the United States of America or Canada for receipt by a Loan Party within sixty (60) days of the date of determination, but which has not yet delivered to such Loan Party, (ii) for which title has passed to such Loan Party, (iii) for which the bill of lading or other document of title reflects a Loan Party as consignee, (iv) which is insured to the reasonable satisfaction of the Collateral Agent, and (v) which otherwise would constitute Eligible Inventory;  and
 
(b) (i) which has been shipped from a location (other than one within the United States of America or Canada) for receipt by a Loan Party within sixty (60) days of the date of determination and is reflected in the Loan Parties’ import system, but which has not yet delivered to such Loan Party, (ii) for which title has passed to such Loan Party, (iii) for which the bill of lading or other document of title reflects a Loan Party as consignee (along with delivery to such Loan Party or its customs broker of the documents of title with respect thereto), (iv) as to which the Collateral Agent has control over a set of documents of title which evidence ownership of the subject Inventory (such as, if requested by the Collateral Agent, by the delivery of a customs broker agency agreement, satisfactory to the Collateral Agent), (v) which is insured to the reasonable satisfaction of the Collateral Agent, and (vi) which otherwise would constitute Eligible Inventory.
 
“ Eligible Inventory ” means, as of the date of determination thereof, (a) Eligible In-Transit Inventory, and (b) items of Inventory of the Loan Parties that are finished goods, merchantable and readily saleable to the public in the ordinary course, in each case deemed by the Administrative Agent in its reasonable discretion to be eligible for inclusion in the calculation of the Borrowing Base. Without limiting the foregoing, unless otherwise approved in writing by the Administrative Agent, none of the following shall be deemed to be Eligible Inventory:
 
(a)  Inventory that is not owned solely by one or more Loan Parties, or is leased or on consignment to a Loan Party or by a Loan Party to another Person (other than consigned inventory at Bloomingdale’s, Inc. and/or QVC in an aggregate amount not to exceed $2,000,000 so long as the Collateral Agent shall have received an agreement from Bloomingdale’s, Inc. and/or QVC, as applicable, to provide the Collateral Agent with access to the Inventory of such Loan Party held by such Person on consignment and a reasonable time to repossess or remove such Inventory (or dispose of such Inventory from the premises of Bloomingdale’s, Inc. and/or QVC, as applicable), in form and substance reasonably satisfactory to the Collateral Agent), or such Loan Party does not have good and valid title thereto;
 
(b)  Except as provided in clause (n) below, Inventory (including any portion thereof in transit from vendors, other than Eligible In-Transit Inventory) that is not located at a warehouse facility, distribution center or store, in each case that is owned or leased by a Loan Party;
 
(c)  Inventory that represents (i) goods damaged, defective or otherwise unmerchantable, (ii) goods that do not conform in all material respects to the representations and warranties contained in this Agreement or any of the Security Documents, or (iii) goods that are obsolete, slow moving, stale, or not usable or saleable at prices approximating at least Cost; in the normal course of such Loan Party’s business, in each case, to the extent any of the foregoing ((i) through (iii)) is not factored into the calculation of Appraised Value Percentage;
 
(d)  Inventory that is not located in the United States of America (excluding territories and possessions thereof) or Canada other than Eligible In-Transit Inventory;
 
(e)  Inventory (other than Inventory subject to Permitted Encumbrances described in clause (ii) of the definition thereof) that is not subject to a perfected first priority security interest in favor of the Collateral Agent for the benefit of the Secured Parties;
 
(f)  Inventory which consists of work-in-process, chemicals, samples, protoypes, shopping bags and similar supplies which are not intended for sale in the ordinary course of business (but specifically excluding purses, satchels, backpacks and similar finished goods which are merchantable and readily saleable to the public in the ordinary course) packing and shipping materials and other similar non-merchandise categories;
 
(g)  Inventory as to which insurance in compliance with the provisions of Section 5.7 hereof is not in effect;
 
(h)  Inventory which has been sold but not yet delivered or as to which any Loan Party has accepted a deposit;
 
(i)   Inventory which is acquired in a Permitted Acquisition unless the Collateral Agent, in its Permitted Discretion, agrees that such Inventory shall temporarily be deemed Eligible Inventory, provided, however that if the Collateral Agent so agrees, the advance rate for such Inventory shall not exceed 50% of the Cost of such Inventory and such Inventory shall be deemed Eligible Inventory for no more than ninety (90) days except as set forth in the following proviso, and provided further that , during such ninety (90) day period referred to above, the Collateral Agent shall cause an appraisal of such Inventory to be completed, shall establish Inventory Reserves (if applicable) therefor, and shall otherwise determine whether such Inventory shall be deemed Eligible Inventory;
 
(j)      Inventory that does not consist of finished goods;
 
(k)   Eligible In-Transit Inventory to the extent such Inventory exceeds 15% of total Inventory as shown on the Consolidated financial statements of the Lead Borrower.
 
(l)   Inventory that that is not reflected in the details of a current perpetual inventory report (unless reflected in a report to the Administrative Agent as “in-transit” Inventory)
 
(m)   Inventory that contains or bears any proprietary rights licensed to a Loan Party by any Person, if the Administrative Agent is not satisfied that it may sell or otherwise dispose of such Inventory in accordance with the terms of the Security Documents without infringing the rights of the licensor of such proprietary rights or violating any contract with such licensor (and without payment of any royalties other than any royalties due with respect to the sale or disposition of such Inventory pursuant to the existing license agreement), unless either (i) the licensor has entered into a consent or sublicense agreement with the Collateral Agent in form and substance reasonably acceptable to the Agents (it being understood that each such agreement entered into pursuant to the Existing Credit Agreement shall be deemed to satisfy the  requirement set forth in this clause (i)), (ii) the Adjusted Fixed Charge Coverage Ratio is greater than 1.25:1.00, or (iii)  if the Adjusted Fixed Charge Coverage Ratio is less than 1.25:1.00, (A) such Inventory (other than Inventory of the Famous Footwear Division of the Loan Parties) from a licensor shall be deemed Eligible Inventory only to the extent that the value of such Inventory does not exceed $15,000,000, and (B) licensed Inventory in the Famous Footwear Division of the Loan Parties shall be deemed Eligible Inventory only to the extent that the value of such Inventory does not exceed $15,000,000 (excluding Dr. Scholls Inventory); or
 
(n)   Inventory that is located in a public warehouse or in possession of a bailee or in a facility leased by such Loan Party, if the applicable warehouseman, bailee, or lessor has not delivered to the Collateral Agent, if requested by the Collateral Agent, a subordination agreement or cession of rank and, as to any such Person, an agreement to provide the Collateral Agent with access to the Inventory located in or on such Real Estate and with respect to any such lessor, a reasonable time to sell and dispose of the Inventory from such Real Estate, in form and substance reasonably satisfactory to the Collateral Agent or if a Reserve for rents or storage charges has not been established for Inventory at that location, it being understood that each such agreement entered into pursuant to the Existing Credit Agreement shall be deemed to satisfy each of the foregoing requirements.
 
“ Eligible Letter of Credit ” means, as of any date of determination thereof, a Commercial Letter of Credit which supports the purchase of Inventory, (i) which Inventory does not constitute Eligible In-Transit Inventory and for which no documents of title have then been issued; (ii) which Inventory otherwise would constitute Eligible Inventory (without giving effect to the exclusions set forth in clauses (b), (d) and (n) of the definition of “Eligible Inventory”), (c) which Commercial Letter of Credit has an expiry within sixty (60) days of the date of initial issuance of such Commercial Letter of Credit, and (iv) which Commercial Letter of Credit provides that it may be drawn only after the Inventory is completed and after documents of title have been issued for such Inventory reflecting a Borrower or the Collateral Agent as consignee of such Inventory.
 
“ Environmental Laws ” means all Applicable Laws issued, promulgated or entered into by or with any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, handling, treatment, storage, disposal, Release or threatened Release of any Hazardous Material or to health and safety matters.
 
“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, natural resource damage, costs of environmental remediation, administrative oversight costs, fines, penalties or indemnities), of any Person directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transporta­tion, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
 
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.
 
“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that, together with any Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
 
“ ERISA Event ” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by a Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by a Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by a Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by a Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from a Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
 
“ Event of Default ” has the meaning assigned to such term in Section 7.1.  An “Event of Default” shall be deemed to have occurred and to be continuing unless and until that Event of Default has been duly waived in writing or cured, in each case as provided in this Agreement.
 
“ Excess Availability ” means, as of any date of determination, the excess, if any, of (a) the lesser of the then Total Commitments or the Borrowing Base, over (b) the outstanding Credit Extensions.
 
“ Excluded Taxes ” means, with respect to the Agents, any Lender, any Issuing Bank, any Acceptance Lender or any other recipient of any payment to be made by or on account of any obligation of the Borrowers hereunder, (a) income or franchise taxes imposed on (or measured by) its gross or net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which any Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by a Borrower under Section 2.30(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender’s failure to comply with Section 2.28, except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrowers with respect to such withholding tax pursuant to Section 2.28(a).
 
“ Existing Acceptances ” means each of the acceptances issued under the Existing Credit Agreement prior to the date hereof.
 
“ Existing Credit Agreement ” has the meaning set forth in the Preamble to the Agreement.
 
“ Existing Letters of Credit ” means each of the letters of credit issued under the Existing Credit Agreement prior to the date hereof.
 
“ Facility Guaranty ” means collectively, the Canadian Guaranty and the Amended and Restated Domestic Guaranty in each case dated as of July 21, 2004, executed by the applicable Facility Guarantors in favor of the Agents, the Issuing Banks, Acceptance Lenders, the Lenders and the other Secured Parties.
 
“ Facility Guarantors ” means each Borrower and Brown Canada.
 
“ Facility Guarantors’ Collateral Documents ” means all security agreements, pledge agreements, and other instruments, documents or agreements executed and/or amended and delivered by the Facility Guarantors to secure the Facility Guaranty and/or the Obligations.
 
“ Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.
 
“ Fee Letter ” means the letter entitled “Fee Letter” among the Borrowers and the Administrative Agent dated as of October 31, 2008, as such letter may from time to time be amended.
 
“ Financial Officer ” means, with respect to any Borrower, the chief financial officer, chief accounting officer, senior vice president-finance, treasurer, controller or assistant controller of such Borrower.
 
“ Fiscal Period ” means one of the three Fiscal Periods in a Fiscal Quarter each of which is approximately one month in duration.  There are twelve (12) Fiscal Periods in each Fiscal Year.
 
“ Fiscal Quarter ” means one of four thirteen (13) week or, if applicable, fourteen (14) week quarters in a Fiscal Year, with the first of such quarters beginning on the first day of a Fiscal Year and ending on Saturday of the thirteenth (or fourteenth, if applicable) week in such quarter.
 
“ Fiscal Year ” means, with respect to the Lead Borrower, the Lead Borrower’s Fiscal Year for financial accounting purposes.  The current Fiscal Year of the Lead Borrower will end on January 31, 2009.
 
“ Fixed Charge Coverage Measurement Date ” means the last day of any Fiscal Quarter of the Lead Borrower immediately preceding a measurement event.  As used in this definition, “measurement event” means any failure of the Loan Parties to maintain Excess Availability equal to or in excess of seventeen and one-half (17.5%) percent of the lesser of (i) the then Total Commitments or (ii) the then Borrowing Base on any day.
 
“ Fixed Charge Coverage Ratio ” means, as of the last day of any Fiscal Quarter of the Lead Borrower for the preceding four Fiscal Quarters then ended, the ratio of (a) Consolidated EBITDA for such period, to (b) Fixed Charges for such period.
 
“ Fixed Charges ” means, for any period, as determined for the Lead Borrower and its Subsidiaries on a Consolidated basis, without duplication, the sum of (a) Consolidated Interest Expense during such period, (b) Capital Expenditures (excluding Capital Expenditures funded with Indebtedness other than Revolving Loans) during such period, (c) scheduled principal payments of Indebtedness payable over the course of the preceding four (4) Fiscal Quarters, (d) federal, state, local, and foreign income taxes net of refunds received, to the extent any such taxes are paid in cash during such period (excluding taxes paid to repatriate foreign earnings for fiscal periods which are more than twelve months prior to the date of determination of Fixed Charges for any period), and (e) Restricted Payments during such period, excluding any Restricted Payments (x) consisting of dividends or distributions made in Capital Stock under clause (a) of the definition thereof and (y) permitted under Section 6.7(a)(iii).
 
“ Foreign Lender ” means any Lender that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.
 
“ Foreign Plan ” means any benefit plan established or maintained outside of the United States of America which a Loan Party maintains, sponsors, or to which such Person has any obligation or liability and which provides or otherwise makes available retirement or deferred benefits of any kind whatsoever to employees.
 
“ Foreign Subsidiary ” means any Subsidiary other than a Domestic Subsidiary.
 
“ Fronting Fee ” has the meaning given to such term in Section 2.14(b).
 
“ Fund ” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.
 
“ GAAP ” means accounting principles which are (a) consistent with those promulgated or adopted by the Financial Accounting Standards Board and its predecessors (or successors) in effect and applicable to that accounting period in respect of which reference to GAAP is being made, and (b) consistently applied with past financial statements of the Lead Borrower and its Subsidiaries on a Consolidated basis adopting the same principles.
 
“ Governmental Authority ” means the government of the United States of America or Canada or any other nation or any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, department, agency, board, commission, tribunal, committee,  court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
 
“ Guarantee ” of or by any Person (the “ guarantor ”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or acceptance or letter of guaranty issued to support such Indebtedness or obligation, provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.
 
“ Hazardous Materials ” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes, mold and other fungi, bacteria, and all other substances or wastes of any nature regulated pursuant to any Environmental Law, including any material listed as a hazardous substance under Section 101(14) of CERCLA.
 
“ Headquarters ” means the Real Estate at which the Lead Borrower’s headquarters are maintained and other Real Estate located adjacent thereto, including the Real Estate located at 8300, 8350, 8400 and 8500 Maryland Avenue, St. Louis, Missouri and the lot at the corner of Maryland Avenue and Topton Way, St. Louis, Missouri.
 
“ Hedging Agreement ” means any interest rate protection agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, foreign currency exchange agreement, commodity price protection agreement, or other interest or currency exchange rate or commodity price hedging arrangement designed to hedge against fluctuations in interest rates or foreign exchange rates.
 
“ Indebtedness ” of any Person means, without duplication, (a) all obligations of such Person for borrowed money (including any obligations for borrowed money which are without recourse to the credit of such Person), (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business and, in each case, not past due for more than 90 days after the date on which such trade account payable was created unless such account is the subject of a bona fide dispute and adequate reserves have been established therefor in accordance with GAAP), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (k) the net termination obligations of all Hedging Agreements, and (l) the present value (discounted at the interest rate applicable to such obligations) of the principal and interest portions of all rental obligations of such Person under any Synthetic Lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.
 
“ Indemnified Taxes ” means Taxes other than Excluded Taxes.
 
“ Indemnitee ” has the meaning provided therefor in Section 9.3(b).
 
“ Interest Payment Date ” means (a) with respect to any Prime Rate Loan (including a Swingline Loan), the fifteenth day of each January, April, July and October, and (b) with respect to any LIBO Loan, on the last day of the Interest Period applicable to the Borrowing of which such Loan is a part, and, in addition, if such LIBO Loan has an Interest Period of greater than 90 days, on the last day of the third, sixth and ninth months of such Interest Period, as applicable.  Except as otherwise provided herein, if any day on which a payment is due is not a Business Day, then the payment shall be due on the next day following which is a Business Day and such extension of time shall be included in computing interest and fees in connection with such payment.
 
“ Interest Period ” means, with respect to any LIBO Borrowing, the period commencing on the date of such Borrowing and ending seven days, fourteen days or twenty-one days or one, two, three or six months thereafter, and, if available from all of the Lenders, nine months or twelve months thereafter, as the Lead Borrower may elect by notice to the Administrative Agent in accordance with the provisions of this Agreement, provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, and (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month during which such Interest Period ends) shall end on the last Business Day of the calendar month of such Interest Period, and (c) any Interest Period which would otherwise end after the Termination Date shall end on the Termination Date. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
 
“ Inventory ” has the meaning assigned to such term in the Security Agreements.
 
“ Inventory Reserves ” means, without duplication of any other Reserves or items that are otherwise addressed or excluded through eligibility criteria or in the most recently conducted appraisal, such reserves as may be established from time to time by the Administrative Agent in the Administrative Agent’s Permitted Discretion (after consultation with the Lead Borrower (whose consent to any Inventory Reserves shall not be required)) with respect to the determination of the saleability, at retail, of the Eligible Inventory or which reflect such other factors as affect the appraised or market value of the Eligible Inventory. Without limiting the generality of the foregoing, in the Administrative Agent’s Permitted Discretion, Inventory Reserves may include (but are not limited to) reserves based on (i) Shrink; (ii) capitalized freight and internal profit reserves used in the Borrowers’ calculation of cost of goods sold; (iii) obsolescence; (iv) seasonality; (v) imbalance; (vi) change in Inventory character or composition; (vii) change in inventory mix; (viii) reasonably anticipated changes in appraised value of Inventory between appraisals; and (ix) retail markdowns and markups inconsistent with prior period practice and performance; industry standards; current business plans; or advertising calendar and planned advertising events.  Inventory Reserves shall be established and calculated in a manner and methodology consistent with the Administrative Agent’s practices with the Loan Parties as of the Closing Date, provided that in establishing and calculating any such Inventory Reserves, the Administrative Agent may take into account changes to the Loan Parties’ business after the Closing Date, and provided further , however, that if (x) an Event of Default exists, (y) any of the conditions described in clauses (ii) and (iii) of the first sentence of the definition of “Permitted Discretion” apply, or (z) any factor or circumstance described in clause (D) of the second sentence of the definition of “Permitted Discretion” exists, then Inventory Reserves may be established and calculated in a manner and methodology consistent with the Administrative Agent’s practices as of the Closing Date with other similarly situated borrowers.  The Inventory Reserves in effect on the Closing Date are reflected on the Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 4.1(d) hereof.
 
“ Investment ” has the meaning provided therefor in Section 6.4.
 
“ Issuing Bank ” means, collectively, the Lead Issuing Bank, Wells Fargo Retail Finance, LLC, and, upon the reasonable consent of the Administrative Agent, up to two (2) additional Lenders (other than the Lead Issuing Bank and Wells Fargo Retail Finance, LLC), provided that any such additional Lender shall be deemed an Issuing Bank hereunder solely during the period during which a Letter of Credit issued by such Lender (other than the Lead Issuing Bank and Wells Fargo Retail Finance, LLC) is outstanding and either undrawn (in whole or in part) or with respect to which there is an unreimbursed L/C Disbursement. Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case during the period during which any such Letter of Credit is outstanding and either undrawn (in whole or in part) or with respect to which there is an unreimbursed L/C Disbursement, during such period the term “Issuing Bank” shall include any such Affiliate with respect to such Letters of Credit.
 
“ L/C Disbursement ” means a payment made by any Issuing Bank pursuant to a Letter of Credit.
 
“ Lead Borrower ” means Brown Shoe Company, Inc.
 
“ Lead Issuing Bank ” means Bank of America, in its capacity as such and any successor in such capacity.
 
“ Lenders ” means the Persons identified on Schedule 1.1 and each assignee that becomes a party to this Agreement as set forth in Section 9.5(b), or each Person that becomes an Additional Commitment Lender as set forth in Section 2.2(a).
 
“ Letter of Credit ” means a letter of credit that satisfies all of the following conditions: (i) is issued pursuant to this Agreement for the account of any Borrower or any Facility Guarantor or for the joint account of any Borrower or any Facility Guarantor and any Loan Party or any of its Subsidiaries, (ii) is a Standby Letter of Credit or Commercial Letter of Credit, (iii) is issued in connection with the purchase of Inventory by any Loan Party, or in support of an obligation of any Loan Party or any of its Subsidiaries incurred in the ordinary course of business, or for any other purpose that is reasonably acceptable to the Administrative Agent, and (iv) is in form and substance reasonably satisfactory to the Lead Issuing Bank and, if applicable, the Issuing Bank issuing such Letter of Credit. Without limiting the foregoing, the Existing Letters of Credit shall be deemed Letters of Credit issued under this Agreement.
 
“ Letter of Credit Fees ” means the fees payable in respect of Letters of Credit pursuant to Section 2.14.
 
“ Letter of Credit Outstandings ” means, at any time, the sum of (a) with respect to Letters of Credit outstanding at such time, the aggregate maximum amount that then is or at any time thereafter may become available for drawing or payment thereunder plus (b) all amounts theretofore drawn or paid under Letters of Credit for which the applicable Issuing Bank has not then been reimbursed by the Loan Parties.
 
“ LIBO Borrowing ” means a Borrowing comprised of LIBO Loans.
 
“ LIBO Loan ” means any Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Section 2.
 
“ LIBO Rate ” means, with respect to any LIBO Borrowing for any Interest Period, the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period.  If such rate is not available at such time for any reason, then the “LIBO Rate” for such Interest Period shall be the rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the LIBO Loan being made, continued or converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period.
 
“ Lien ” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset (c) any other lien, charge, privilege, secured claim, title retention, garnishment right, deemed trust, encumbrance or other right affecting assets, choate or inchoate, arising by any statute, act of law of any jurisdiction at common law or in equity or by agreement; and (d) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
 
“ Loan Account ”  has the meaning assigned to such term in Section 2.22(a).
 
“ Loan Documents ” means this Agreement, the Notes, the Letters of Credit, the Fee Letter, all Borrowing Base Certificates, the Blocked Account Agreements, the Credit Card Notifications, the Security Documents, the Facility Guaranty, the Confirmation Agreement, and any other instrument or agreement now or hereafter executed and delivered in connection herewith or therewith, or in connection with any Bank Product or Cash Management Services.
 
“ Loan Party ” means each Borrower and each Facility Guarantor.
 
“ Loans ” means all loans (including, without limitation, Revolving Loans and Swingline Loans) at any time made to the Borrowers or for account of the Borrowers pursuant to this Agreement.
 
“ Macy’s ” means, collectively, Macy’s Inc. (formerly known as Federated Department Stores, Inc.) and any successor thereto.
 
“ Maintenance Capital Expenditures ” means Capital Expenditures incurred for the purposes of maintaining existing facilities, but excluding initial expenditures related to new facilities and remodels of existing facilities.
 
“ Margin Stock ” has the meaning assigned to such term in Regulation U.
 
“ Material Adverse Effect ” means a material adverse effect on (a) the business, operations, property, assets, or condition, financial or otherwise, of the Loan Parties, taken as a whole, (b) the ability of the Loan Parties, taken as a whole, to perform any material obligation or to pay any Obligations under this Agreement or any of the other Loan Documents, or (c) the validity or enforceability of this Agreement or any of the other Loan Documents or any of the material rights or remedies of the Administrative Agent, the Collateral Agent or the Lenders hereunder or thereunder.
 
 “ Material Indebtedness ” means Indebtedness (other than the Loans and Letters of Credit) of any one or more of the Loan Parties in an aggregate principal amount exceeding $15,000,000.
 
“ Material Subsidiary ” means each Domestic Subsidiary (other than Edelman unless and until the Lead Borrower or any other Loan Party owns 100% of the Capital Stock of Edelman) or Canadian Subsidiary of a Loan Party which, as of the last day of any Fiscal Quarter, satisfied any one or more of the following tests:
 
(a)           such Subsidiary owns property that would constitute Collateral valued in excess of $10,000,000; or
 
(b)           such Subsidiary has revenues in any Fiscal Year in excess of $50,000,000; or
 
(c)           such Subsidiary, and all other Subsidiaries which are not Loan Parties own property that would constitute Collateral valued in excess of $25,000,000, then all such Subsidiaries shall be deemed Material Subsidiaries; or
 
(d)           such Subsidiary and all other Subsidiaries which are not Loan Parties have revenues in any Fiscal Year in excess of $100,000,000, then all such Subsidiaries shall be deemed Material Subsidiaries.
 
For clarity, a Subsidiary shall not be deemed a “Material Subsidiary” unless it meets any of the foregoing tests, notwithstanding that such Subsidiary is the holder of the Capital Stock of another Subsidiary which satisfies such tests.
 
“ Maturity Date ” means January 21, 2014.
 
“ Maximum Rate ” has the meaning provided therefor in Section 9.14.
 
“ Minority Lenders ” has the meaning provided therefor in Section 9.2(c).
 
“ Moody’s ” means Moody’s Investors Service, Inc.
 
“ Multiemployer Plan ” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
 
“ Net Amount of Eligible Credit Card Receivables ” means, at any time, the gross amount of Eligible Credit Card Receivables less, without duplication, (a) sales, excise, or similar taxes which are not reserved in the Borrowing Base, and (b) with respect to Eligible Credit Card Receivables, returns, discounts, claims, credits, allowances, accrued rebates, offsets, deductions, counterclaims, disputes, and other defenses of any nature at any time issued, owing, granted, outstanding, available, or claimed, in each case calculated and determined in Dollars.
 
“ Net Amount of Eligible Accounts ” means, at any time, the gross amount of Eligible Accounts less, without duplication, (a) sales, excise, or similar taxes which are not reserved in the Borrowing Base, and (b) with respect to Eligible Accounts, returns, discounts, claims, credits, allowances, accrued rebates, offsets, deductions, counterclaims, disputes, and other defenses of any nature at any time issued, owing, granted, outstanding, available, or claimed, in each case calculated and determined in Dollars.
 
“ Noncompliance Notice ” has the meaning provided therefor in Section 2.6(b).
 
“ Notes ” means (a) the promissory notes of the Borrowers substantially in the form of Exhibit B , each payable to the order of a Lender, evidencing the Revolving Loans and (b) the Swingline Note.
 
“ Obligations ” means (a) the due and punctual payment by the Borrowers of (i) the principal of, and interest (including all interest that accrues after the commencement of any case or proceeding by or against any Borrower under any federal or state bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Borrowers under the Credit Agreement in respect of any Letter of Credit or Acceptance, when and as due, including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan Parties to the Secured Parties under the Credit Agreement and the other Loan Documents, including all monetary obligations that accrue after the commencement of any case or proceeding by or against any Borrower under any federal or state bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding, (b) the due and punctual payment and performance of all covenants, agreements, obligations and liabilities of the Loan Parties under or pursuant to this Agreement and the other Loan Documents, and (c) solely to the extent that there is sufficient Collateral following satisfaction of the Obligations described in clause (a) of this definition, the payment and performance under any transaction with any Lender or any of its Affiliates, which arises out of any Bank Products or Cash Management Services.
 
“ Other Taxes ” means any and all current or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.
 
“ Overadvance ” means, at any time of calculation, a circumstance in which the Credit Extensions exceed the lesser of (a) the Total Commitments or (b) the Borrowing Base.
 
“ Participant ” has the meaning provided therefor in Section 9.5(e).
 
“ Payment Conditions ” means, at the time of determination with respect to a specified transaction or payment, that (a) no Default or Event of Default then exists or would arise as a result of the  entering into such transaction or the making of such payment and (b) prior to and after giving effect to such transaction or payment, Excess Availability shall exceed the greater of (i) twenty percent (20%) of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000; (c) the Adjusted Fixed Charge Coverage Ratio, on a pro-forma basis (in each case, after giving effect to such transaction or payment) for the two (2) most recent full Fiscal Quarters preceding such transaction or payment and for two (2) full Fiscal Quarters following such transaction or payment (determined on a projected and pro forma basis), shall be equal to or greater than 1.0:1.0 and (d) the Loan Parties shall have provided the Administrative Agent with a certificate from a Financial Officer demonstrating to the reasonable satisfaction of the Administrative Agent that, on a pro forma basis (after giving effect to such transaction or payment), the Loan Parties, taken as a whole, are, and will be, Solvent.
 
 “ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
 
“ Perfection Certificate ” means a certificate in the form of Exhibit C to this Agreement or any other form approved by the Collateral Agent.
 
“ Permitted Acquisition ” means collectively:
 
(a) so long as prior to and after giving effect to such Acquisition, no Default or Event of Default will exist or arise therefrom, the acquisition by a Borrower or Facility Guarantor of all or a portion of the Capital Stock of Edelman not owned directly or indirectly by the Lead Borrower on the Closing Date or all or substantially all of the assets of Edelman (the “ Edelman Acquisition ”), provided that , if upon the consummation of such acquisition any Loan Party shall directly or indirectly hold 100% of the issued and outstanding Capital Stock of Edelman, Edelman shall become a Borrower or Facility Guarantor hereunder in accordance with the provisions of Section 5.14 hereof; and
 
(b) an Investment in, a purchase of the Capital Stock in, or the acquisition of all or a substantial portion of the assets or properties of, any Person or of any business unit or division of any Person, the entering into any exchange of securities with any Person, or the entering into any transaction, merger or consolidation of any Person, or any acquisition of any retail store locations of any Person (each of the foregoing an “Acquisition”) in each case under this clause (b) which satisfies each of the following conditions:
 
 
(i)
The Acquisition is of a business permitted to be conducted by the Borrowers pursuant to Section 6.3(b) hereof;
 
 
(ii)
Prior to and after giving effect to the Acquisition, no Default or Event of Default will exist or will arise therefrom;
 
 
(iii)
The Borrowers shall have furnished the Administrative Agent with the information required under Section 5.1(i) of this Agreement;
 
 
(iv)
If the Acquisition is of the Capital Stock of any Person, the Acquisition is structured so that the Person shall become a wholly owned Subsidiary of the Lead Borrower and such Person will become a Borrower or Facility Guarantor if required in accordance with Section 5.14 hereof and if such Person is required to become a Borrower or Facility Guarantor, the Borrowers (including such Person) shall take such steps as are necessary to grant to the Collateral Agent, for the benefit of the Secured Parties, a legal, valid and enforceable first priority security interest (except as provided in Section 6.2 hereof) in all of the assets (that would otherwise constitute Collateral) acquired in connection with such Acquisition;
 
 
(v)
If a Borrower shall merge with such other Person, such Borrower shall be the surviving party of such merger;
 
 
(vi)
such acquisition shall not be a hostile or contested acquisition;
 
(vii)  
the total consideration paid or payable in connection with any Acquisition (whether in cash, property or securities) shall not exceed $35,000,000 for any Acquisition or $100,000,000 in the aggregate for all Acquisitions after the Closing Date, unless, in each case, the Payment Conditions are satisfied, provided that the Edelman Acquisition shall not be taken into account in determining the utilization of the foregoing baskets and such baskets shall not apply to the Edelman Acquisition; and
 
(viii)  
no Loan Party shall, as a result of or in connection with any such acquisition, assume or incur any direct or contingent liabilities (whether relating to environmental, tax, litigation, or other matters) that could reasonably be expected, as of the date of such acquisition, to result in the existence or occurrence of a Material Adverse Effect.
 
“ Permitted Discretion ” means the Administrative Agent’s good faith credit judgment based upon any factor or circumstance which it reasonably believes in good faith: (i) will or could reasonably be expected to adversely affect the value of the Collateral, the enforceability or priority of the Collateral Agent’s Liens thereon in favor of the Secured Parties or the amount which the Collateral Agent and the Secured Parties would likely receive (after giving consideration to delays in payment and costs of enforcement) in the liquidation of such Collateral; (ii) suggests that any collateral report or financial information delivered to the Administrative Agent by or on behalf of the Loan Parties is incomplete, inaccurate or misleading in any material respect; (iii) could reasonably be expected to materially increase the likelihood of a bankruptcy, reorganization or other insolvency proceeding involving any Loan Party; or (iv) creates or reasonably could be expected to create a Default or Event of Default.  In exercising such judgment, the Administrative Agent may consider such factors or circumstances already included in or tested by the definition of Eligible Accounts, Eligible in-Transit Inventory, or Eligible Inventory, as well as any of the following: (A) the financial and business climate and prospects of any Loan Party’s industry and general macroeconomic conditions; (B) changes in demand for and pricing of Inventory; (C) changes in any concentration of risk with respect to Inventory; (D) any other factors or circumstances that will or could reasonably be expected to have a Material Adverse Effect; (E) audits of books and records by third parties, history of chargebacks or other credit adjustments; and (F) any other factors that change or could reasonably be expected to change the credit risk of lending to the Borrowers on the security of the Accounts and Inventory.  Notwithstanding the foregoing, it shall not be within Permitted Discretion for the Administrative Agent to establish Reserves which are duplicative of each other whether or not such reserves fall under more than one reserve category.
 
“ Permitted Encumbrances ” means:
 
(i)           Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.5;
 
(ii)           carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with Section 5.5, provided, however , that the aggregate amount of such Liens, may not at any time exceed $35,000,000 from and after the Closing Date;
 
(iii)           pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance, old-age pension and other social security laws or regulations;
 
(iv)           deposits to secure the performance of bids, trade contracts, leases, contracts (other than for the repayment of borrowed money), statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;
 
(v)           judgment Liens in respect of judgments that do not constitute an Event of Default under Section 7.1(l);
 
(vi)           easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of any Loan Party;
 
(vii)           Possessory Liens in favor of brokers and dealers arising in connection with the acquisition or disposition of Investments owned as of the date hereof and Permitted Investments, provided that such Liens (a) attach only to such Investments and (b) secure only obligations incurred in the ordinary course and arising in connection with the acquisition or disposition of such Investments and not any obligation in connection with margin financing;
 
(viii)           Landlords' and lessors' Liens in respect of rent not in default; and
 
(ix)           Liens in favor of a financial institution encumbering deposits (including the right of setoff) held by such financial institution in the ordinary course of its business to secure Indebtedness permitted hereunder and which are within the general parameters customary in the banking industry
 
provided that, except as provided in any one or more of clauses (i) through (vi) above, the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.
 
“ Permitted Investments ” means each of the following:
 
(i)           Investments in direct obligations of the United States of America (or any agency thereof or any obligations guaranteed by the United States of America, provided that such obligations mature within one year from the date of acquisition thereof;
 
(ii)           Investments in commercial paper maturing within 90 days from the date of acquisition thereof and having, at such date of acquisition, a credit rating of at least A-2 or P-2 from S&P or from Moody’s;
 
(iii)           Investments in certificates of deposit maturing within one year from the date of acquisition, banker’s acceptances, Eurodollar bank deposits, and overnight bank deposits, in each case issued by or created by, or with, a Lender, an Affiliate of a Lender or a bank or trust company organized under the laws of the United States of America or Canada or any state, province or territory thereof, having capital and surplus aggregating at least $100,000,000, and other bank deposits to the extent such deposits are insured by a Governmental Authority or pursuant to any governmental deposit insurance program or are in the process of collection and transfer in the ordinary course of business to any deposit account which is maintained in the name of the Collateral Agent or the Administrative Agent or any Loan Party, or any of them, as the Administrative Agent may determine, on terms acceptable to the Administrative Agent;
 
(iv)           Investments in mutual funds substantially all of the assets of which are securities of the type described in clauses (i), (ii) and (iii) of this definition;
 
(v)           Investments by the Loan Parties in deposit accounts in the ordinary course of business with financial institutions (A) located in the United States of America and Canada, and (B) located in a jurisdiction other than the United States of America and Canada in an amount not in excess of $5,000,000 in the aggregate; and
 
(vi)           fully collateralized repurchase obligations of any commercial bank organized under the laws of the United States of America or any state thereof, having capital and surplus aggregating at least $100,000,000, having a term of not more than thirty (30) days, with respect to securities issued or fully guaranteed or insured by the government of the United States of America;
 
provided that , notwithstanding the foregoing, (i) after the occurrence and during the continuance of a Cash Dominion Event, no such Investments (other than those described in clause (v) above) shall be permitted by a Borrower unless either (A) no Loans are then outstanding, or (B) the Investment is a temporary Investment pending expiration of an Interest Period for a LIBO Loan, the proceeds of which Investment will be applied to the Obligations after the expiration of such Interest Period,  and (ii) such Investments are pledged by the applicable Borrower to the Administrative Agent as additional collateral for the Obligations pursuant to such agreements as may be reasonably required by the Administrative Agent.
 
“ Permitted Overadvance ” means an Overadvance determined by the Administrative Agent, in its reasonable discretion, (a) which is made to maintain, protect or preserve the Collateral and/or the Lenders’ rights under the Loan Documents, or (b) which is otherwise in the Lenders’ interests; provided that Permitted Overadvances shall not (i) exceed five percent of the then Borrowing Base in the aggregate outstanding at any time and (ii) remain outstanding for more than thirty consecutive Business Days, unless in case of clause (ii) the Required Lenders otherwise agree; and provided further that the foregoing shall not (1) modify or abrogate any of the provisions of Section 2.7(h) regarding the Lenders’ obligations with respect to L/C Disbursements, or (2) result in any claim or liability against the Administrative Agent (regardless of the amount of any Overadvance) for “inadvertent Overadvances” (i.e. where an Overadvance results from changed circumstances beyond the control of the Administrative Agent (such as a reduction in the collateral value)), and further provided that in no event shall the Administrative Agent make an Overadvance, if after giving effect thereto, the principal amount of the Credit Extensions (including any Overadvance or proposed Overadvance) would exceed the Total Commitments.
 
“ Permitted Stock Repurchase ” means a purchase by the Lead Borrower of Capital Stock of the Lead Borrower; provided that the aggregate of all such purchases shall not exceed $35,000,000 for any Permitted Stock Repurchase or $100,000,000 in the aggregate for all Permitted Stock Repurchases after the Closing Date, unless, in each case, the Payment Conditions are satisfied.
 
“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
 
“ Plan ” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which a Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
 
“ PPSA ” means the Personal Property Security Act (Ontario) ( or any successor statute) or similar legislation of any other Canadian jurisdiction, the laws of which are required by such legislation to be applied in connection with the issue, perfection, enforcement, opposability, validity or effect of security interests.
 
“ Prime Rate ” means, for any day, a fluctuating rate per annum equal to the highest of (a) the Federal Funds Effective Rate plus 1/2 of 1%, (b) the Adjusted LIBO Rate for an Interest Period of one month determined at approximately 11:00 a.m. (London time) on such day plus 1.00% per annum and (c) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate.”  The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.
 
“ Prime Rate Loan ” means any Loan bearing interest at a rate determined by reference to the Prime Rate in accordance with the provisions of Section 2.
 
“ Real Estate ” means all land, together with the buildings, structures, parking areas, and other improvements thereon, now or hereafter owned or leased by any Loan Party, including all easements, rights-of-way, and similar rights relating thereto and all leases, tenancies, and occupancies thereof.
 
“ Refinancing Notes ” means publicly issued or privately placed notes which refinance all or a portion of the Senior Notes so long as, after giving effect thereto (i) the aggregate principal amount of the Senior Notes and Refinancing Notes outstanding after giving effect to the issuance of the Refinancing Notes is not greater than the outstanding principal amount of the Senior Notes immediately prior to the issuance of the Refinancing Notes (except by the amount of any accrued interest, expenses, fees, and premium paid in connection with such refinancing), (ii) the result of such refinancing shall not result in a maturity date which is earlier than six (6) months following the Maturity Date or decreased weighted average life, (iii) the holders of such refinancing notes are not afforded covenants, defaults, rights or remedies, taken as a whole, which are materially more burdensome to the obligor or obligors than those contained in the Senior Notes being refinanced, (iv) the obligor or obligors under any such refinancing notes and the collateral, if applicable, granted pursuant to any such refinancing notes are the same (or in the case of collateral, the same or less than) as the obligor(s) and collateral under the Senior Notes being refinanced, (v) the subordination, to the extent applicable, and other material provisions of the refinancing notes are no less favorable to the Lenders than those terms of the Senior Notes being refinanced, and (vi) the refinancing notes are not exchangeable or convertible into any other Indebtedness which does not comply with clauses (i) through (v) above.
 
“ Register ” has the meaning set forth in Section 9.5(c).
 
“ Regulation U ” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
 
“ Regulation X ” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
 
“ Related Parties ” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.
 
“ Release ” has the meaning set forth in Section 101(22) of CERCLA.
 
“ Relevant Date ” means (i) in the case of each Lender signatory hereto on the Closing Date, the Closing Date, and (ii) in the case of each other Lender, the effective date of the Assignment and Acceptance or other document pursuant to which it becomes a Lender.
 
 “ Required Lenders ” means, at any time, at least three (3) Lenders having Commitments greater than 50% of the Total Commitments, or if the Commitments have been terminated, Lenders holding in the aggregate greater than 50% of all Loans and Letters of Credit Outstanding (with the aggregate amount, without duplication, of each Lender’s risk participation and funded participation in Letters of Credit and Swingline Loans being deemed “held” by such Lender (and an Issuing Bank or Swingline Lender) for purposes of this definition).
 
“ Reserves ” means the Inventory Reserves and Availability Reserves.
 
“ Responsible Officer ” means with respect to any Borrower, the chief executive officer or the president or any Financial Officer.
 
“ Restricted Payment ” means, with respect to any Person (other than a natural person): (a) the payment or making of any dividend or other distribution of property in respect of such Person’s Capital Stock (or any options or warrants for, or other rights with respect to, such Capital Stock) of such Person, other than distributions solely in such Person’s Capital Stock (or any options or warrants for, or other rights with respect to, such Capital Stock) of the same class; or (b) the redemption or other acquisition by such Person of any Capital Stock (or any options or warrants for, or other rights with respect to, such Capital Stock) of such Person (including without limitation, any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares of Capital Stock); provided that (x) the issuance or redemption of the Lead Borrower’s Capital Stock to or from any officer, director or employee of any Borrower or any of its Subsidiaries in the ordinary course of the Lead Borrower’s business (including, without limitation, in the ordinary operation of the Lead Borrower’s employee benefit plans or in connection with directors’ plans or compensation), (y) the issuance to holders of Capital Stock of the Lead Borrower of rights to acquire additional Capital Stock on the occurrence of any specified event or circumstance, and (z) any redemption of rights to acquire additional stock under any “poison pill” rights agreement of the Lead Borrower (as such agreement may be amended or replaced) but only if the redemption price thereunder is not in excess of the redemption price under the most recent “poison pill” rights agreement of the Lead Borrower that existed prior to the Closing Date (as defined in the Existing Credit Agreement), shall not constitute a Restricted Payment hereunder.
 
“ Revolving Loans ” means all Loans at any time made by a Lender pursuant to Article II.
 
“ S&P ” means Standard & Poor’s Rating Services, a division of the McGraw-Hill Companies, Inc.
 
“ Secured Parties ” has the meaning assigned to such term in the Security Agreements.
 
“ Security Agreements ” means, collectively, the Borrower Security Agreement and the Canadian Security Agreements.
 
“ Security Documents ” means the Security Agreements, the Facility Guaranty, the Facility Guarantors’ Collateral Documents, and each other security agreement, guaranty or other instrument or document executed and delivered pursuant to Section 5.15 or any other provision hereof or any other Loan Document, to secure any of the Obligations.
 
“ Senior Notes Indenture ” means the Indenture, dated as of April 22, 2005, among the Lead Borrower, the guarantors party thereto and U.S. Bank National Association, as successor trustee, pursuant to which the Senior Notes were issued.
 
“ Senior Notes ” means the Lead Borrower’s 8.75% Senior Notes due 2012 issued pursuant to the Senior Notes Indenture.
 
“ Settlement Date ” has the meaning provided in Section 2.8(b).
 
“ Shrink ” means Inventory which has been lost, misplaced, stolen, or is otherwise unaccounted for.
 
“ Shoes.com ” has the meaning provided therefor in the Recitals.
 
“ Sidney Rich ” has the meaning provided therefor in the Recitals.
 
“ Solvent ” means, with respect to any Person on a particular date, that on such date (a) at fair valuations, all of the properties and assets of such Person are greater than the sum of the debts, including contingent liabilities, of such Person, (b) the present fair saleable value of the properties and assets of such Person is not less than the amount that would be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its properties and assets and pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts beyond such Person’s ability to pay as such debts mature, and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or transaction, for which such Person’s properties and assets would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which such Person is engaged.
 
 “ Standby Letter of Credit ” means any Letter of Credit other than a Commercial Letter of Credit.
 
“ Statutory Reserve Rate ” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D.  LIBO Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
 
“ Subordinated Debt ” means unsecured Indebtedness of any Loan Party entered into after the Closing Date (including any such Indebtedness that is convertible into Capital Stock (other than Disqualified Stock)) which is subordinated to payment of the Obligations on terms and conditions reasonably acceptable to the Administrative Agent, and any amendments, renewals, restatements, or other modifications thereof.
 
“ Subsidiary ” means, with respect to any Person (the “ parent ”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, directly or indirectly owned, controlled or held, or (b) that is, as of such date, otherwise directly or indirectly Controlled, by the parent and/or one or more subsidiaries of the parent. Unless the context otherwise requires, all references in the Loan Documents to “Subsidiaries” shall be deemed to refer to Subsidiaries of the Lead Borrower.  Notwithstanding anything herein to the contrary, (i) Edelman shall not be deemed to be a Subsidiary until such time as the Lead Borrower directly or indirectly owns more than 50% of the Capital Stock thereof and (ii) B&H and its subsidiaries shall not be deemed to be Subsidiaries until such time as the Lead Borrower directly or indirectly owns 100% of the Capital Stock of B&H.
 
“ Super-Majority Lenders ” means, at any time, Lenders having Commitments equal in the aggregate to at least 75% of the Total Commitments, or if the Commitments have been terminated, Lenders holding in the aggregate at least 75% of all Loans and Letters of Credit Outstanding (with the aggregate amount, without duplication, of each Lender’s risk participation and funded participation in Letters of Credit and Swingline Loans being deemed “held” by such Lender (and an Issuing Bank or Swingline Lender) for purposes of this definition).
 
 “ Swingline Lender ” means Bank of America, N.A., in its capacity as lender of Swingline Loans hereunder.
 
“ Swingline Loan ” means a Loan made by the Swingline Lender to the Borrowers pursuant to Section 2.6 hereof.
 
“ Swingline Note ” means the promissory note, dated July 21, 2004, made by the Borrowers to the Swingline Lender to evidence the Swingline Loans.
 
“ Synthetic Lease ” means any lease or other agreement for the use or possession of property creating obligations which does not appear as Indebtedness on the balance sheet of the lessee thereunder but which, upon the insolvency or bankruptcy of such Person, would be characterized as Indebtedness of such lessee without regard to the accounting treatment.
 
“ Taxes ” means any and all current or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.
 
“ Termination Date ” means the earliest to occur of (i) the Maturity Date, (ii) the date on which the maturity of the Loans are accelerated and the Commitments are terminated in accordance with Section 7.1, or (iii) the date of the occurrence of any Event of Default pursuant to Section 7.1(i) or 7.1(j).
 
“ Termination Event ” means (a) the complete or partial withdrawal of a Facility Guarantor from a Foreign Plan during a plan year; or (b) the filing of a notice of interest to terminate in whole or in part a Foreign Plan or the treatment of a Foreign Plan amendment as a termination of partial termination; or (c) the institution of proceedings by any Governmental Authority to terminate in whole or in part or have a trustee appointed to administer a Foreign Plan; or (d) any other event or condition which might constitute grounds for the termination of, winding up or partial termination of winding up or the appointment of trustee to administer, any Foreign Plan.  Notwithstanding the foregoing, the partial wind-up of the Canadian Pension Plans currently in process or contemplated to begin within a reasonable period of time after the Closing Date shall not be deemed to be a Termination Event.
 
“ Total Commitments ” means, at any time, the sum of the Commitments at such time.
 
“ Type ”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Prime Rate.
 
“ UCC ” means the Uniform Commercial Code as in effect from time to time in the State of New York.
 
“ Unused Commitment ” means, on any day, (a) the then Total Commitments minus (b) the sum of (i) the principal amount of Loans then outstanding (including the principal amount of Swingline Loans then outstanding), and (ii) the then Letter of Credit Outstandings and (iii) the then unreimbursed Acceptances.
 
“ Voting Stock ” means, with respect to any corporation, the outstanding stock of all classes (or equivalent interests) which ordinarily, in the absence of contingencies, entitles holders thereof to vote for the election of directors (or Persons performing similar functions) of such corporation, even though the right so to vote has been suspended by the happening of such contingency.
 
“ Withdrawal Liability ” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
 
1.2   Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding mascu­line, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns or, for natural persons, such Person’s successors, heirs, executors, administrators and other legal representatives, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections, Exhibits and Schedules shall be construed to refer to Sections of, and Exhibits and Schedules to, this Agreement, (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights, (f) all financial statements and other financial information provided by the Loan Parties to the Administrative Agent or any Lender shall be provided with reference to Dollars, and (g) this Agreement and the other Loan Documents are the result of negotiation among, and have been reviewed by counsel to, among others, the Loan Parties and the Administrative Agent and are the product of discussions and negotiations among all parties.  Accordingly, this Agreement and the other Loan Documents are not intended to be construed against the Administrative Agent or any of the Lenders merely on account of the Administrative Agent’s or any Lender’s involvement in the preparation of such documents.
 
1.3   ­Accounting Terms . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect on the Closing Date, on a basis consistent with the financial statements referred to in Section 4.1(h) of this Agreement, provided that, if the Borrowers request an amendment to any provision hereof to reflect the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrowers that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such provision shall have been amended in accordance herewith.  In the event that the Loan Parties are required to or elect to adopt the International Financial Reporting Standards (“ IFRS ”) prior to the Maturity Date, the Lead Borrower shall notify the Administrative Agent at least 90 days prior to the date on which IFRS will apply and the Administrative Agent and the Lead Borrower shall negotiate in good faith such amendments to this Agreement and the other Loan Documents are appropriate.
 
1.4   Rounding .
 
Any financial ratios required to be maintained by the Borrowers pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).
 
1.5   Letter of Credit Amounts .
 
Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by the terms of any documents related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.
 
2.     AMOUNT AND TERMS OF CREDIT .
 
2.1   ­Commitment of the Lenders .
 
(a)   Each Lender severally and not jointly with any other Lender, agrees, upon the terms and subject to the conditions herein set forth, to extend credit to the Borrowers on a revolving basis, in the form of Revolving Loans, participations in Swingline Loans, and Letters of Credit and in an amount not to exceed the lesser of such Lender’s Commitment or such Lender’s Commitment Percentage of the lesser of (x) the Borrowing Base or (y) the Total Commitments, subject to the following limitations:
 
(i)   The aggregate outstanding amount of the Credit Extensions shall not at any time exceed the lower of (i) (x) $380,000,000, or (y) such greater amount or lesser amount to which the Total Commitments have then been increased or decreased by the Borrowers pursuant to Sections 2.2 and/or 2.17 hereof, or (ii) the then amount of the Borrowing Base plus any Permitted Overadvances.
 
(ii)   No Lender (other than the applicable Issuing Bank) shall be obligated to issue any Letter of Credit, and Letters of Credit shall be available from the Issuing Banks, subject to the ratable participation of all Lenders, as set forth in Section 2.7. The aggregate Letter of Credit Outstandings shall not at any time exceed $100,000,000, and the aggregate amount of Letter of Credit Outstandings with respect to Standby Letters of Credit shall not at any time exceed $50,000,000.
 
(iii)   Subject to all of the other provisions of this Agreement, Revolving Loans that are repaid may be reborrowed prior to the Termination Date. No new Credit Extension, however, shall be made to the Borrowers after the Termination Date.
 
(b)   Each Borrowing of Revolving Loans (other than Swingline Loans) shall be made by the Lenders pro rata in accordance with their respective Commitments.  The failure of any Lender to make any Loan shall neither relieve any other Lender of its obligation to fund its Loan in accordance with the provisions of this Agreement nor increase the obligation of any such other Lender.
 
2.2   ­Increase in Total Commitments .
 
(a)   So long as no Default or Event of Default exists or would arise therefrom, the Lead Borrower shall have the right at any time, and from time to time, to request an increase of the Total Commitments by an aggregate amount (for all such requests) not exceeding (i) $150,000,000, plus (ii) an amount equal to the amount of the Commitment of any Defaulting Lender whose Commitment has been terminated but who was not replaced by another Lender or other financial institution at the time of such termination, as adjusted to reflect any pro rata decrease in the Total Commitments pursuant to Section 2.17 hereof which occurred after such termination.  Any such requested increase shall be first made to all existing Lenders on a pro rata basis.  At the time of sending such request, the Lead Borrower (in consultation with the Administrative Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to the Lenders).     Each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its pro rata share of such requested increase.  Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment.  To the extent that the existing Lenders decline to increase their Commitments, or decline to increase their Commitments to the amount requested by the Lead Borrower, the Administrative Agent, in consultation with the Lead Borrower, will use its reasonable efforts to arrange for other Persons to become a Lender hereunder and to issue commitments in an amount equal to the amount of the increase in the Total Commitments requested by the Lead Borrower and not accepted by the existing Lenders (each such increase by either means, a “Commitment Increase,” and each Person issuing, or Lender increasing, its Commitment, an “Additional Commitment Lender”), provided, however, that (i) no Lender shall be obligated to provide a Commitment Increase as a result of any such request by the Borrowers, (ii) any Additional Commitment Lender which is not an existing Lender shall be subject to the approval of the Administrative Agent, the Lead Issuing Bank and the Lead Borrower (which approval shall not be unreasonably withheld or delayed), and (iii) each Commitment Increase shall be in integral multiples of $1,000,000.00, provided that without the consent of the Administrative Agent (in consultation with the Lead Borrower), at no time shall the Commitment of any Additional Commitment Lender which is not an existing Lender be less than $10,000,000.00.
 
(b)   No Commitment Increase shall become effective unless and until each of the following conditions have been satisfied:
 
(i)   If an Additional Commitment Lender is not an existing Lender, the Borrowers, the Administrative Agent, and any Additional Commitment Lender shall have executed and delivered a joinder to the Loan Documents in such form as the Administrative Agent shall reasonably require;
 
(ii)   The Borrowers shall have paid such fees and other compensation to the Additional Commitment Lenders as the Lead Borrower and such Additional Commitment Lenders shall agree;
 
(iii)   The Borrowers shall have paid such arrangement fees to the Administrative Agent or its Affiliates as the Lead Borrower and the Administrative Agent may agree;
 
(iv)   The Borrowers shall deliver to the Administrative Agent and the Lenders certificates of the Secretary or Assistant Secretary of each Borrower attaching a true, complete and correct copy of the resolutions of such Borrower authorizing the borrowing under the Commitment Increase and certifying that such resolution is in full force and effect, it being understood and agreed that such resolutions may be adopted at any time and provide for borrowings under Commitment Increases from time to time requested;
 
(v)   A Note will be issued at the Borrowers’ expense, to each such Additional Commitment Lender, to be in conformity with requirements of Section 2.9 hereof (with appropriate modification) to the extent necessary to reflect the new Commitment of such Additional Commitment Lender; and
 
(vi)   The Borrowers and the Additional Commitment Lender shall have delivered such other instruments, documents and agreements as the Administrative Agent may reasonably have requested, including, without limitation, in the case of an Additional Commitment Lender which is a Foreign Lender, such documents as are set forth in Section 2.28 hereof to evidence an exemption form withholding tax with respect to payments made to such Additional Commitment Lender.
 
(c)   The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Commitment Increase (with each date of such effectiveness being referred to herein as a “Commitment Increase Date”), and at such time (i) the Total Commitments under, and for all purposes of, this Agreement shall be increased by the aggregate amount of such Commitment Increases, (ii) Schedule 1.1 shall be deemed modified, without further action,  to reflect the revised Commitments and Commitment Percentages of the Lenders, and (iii) this Agreement shall be deemed amended, without further action, to the extent necessary to reflect such increased Total Commitments (including, without limitation, Section 2.1(a)(i)).
 
(d)   In connection with Commitment Increases hereunder, the Lenders and the Borrowers agree that, notwithstanding anything to the contrary in this Agreement, (i) the Borrowers shall, in coordination with the Administrative Agent, (x) repay outstanding Loans of certain Lenders, and obtain Loans from certain other Lenders (including the Additional Commitment Lenders), or (y) take such other actions as reasonably may be required by the Administrative Agent, in each case to the extent necessary so that all of the Lenders effectively participate in each of the outstanding Loans pro rata on the basis of their Commitment Percentages (determined after giving effect to any increase in the Total Commitments pursuant to this Section 2.2), and (ii) the Borrowers shall pay to the Lenders any Breakage Costs in connection with any repayment and/or Loans required pursuant to preceding clause (i).  Without limiting the Obligations of the Borrowers provided for in this Section 2.2, the Administrative Agent and the Lenders agree that they will use their best efforts to attempt to minimize any Breakage Costs which the Borrowers would otherwise incur in connection with the implementation of an increase in the Total Commitments.
 
2.3   Changes to Reserves . The Administrative Agent may hereafter, establish additional Reserves or change any of the foregoing Reserves, in the exercise of Permitted Discretion of the Administrative Agent upon two (2) Business Days’ prior notice to the Lead Borrower, (during which period the Administrative Agent shall be available to discuss any such proposed Reserve with the Borrowers); provided that no such prior notice shall be required for  (1) changes to any Reserves resulting solely by virtue of mathematical calculations of the amount of the Reserve in accordance with the methodology of calculation previously utilized, or (2) changes to Reserves or establishment of additional Reserves if a Material Adverse Effect has occurred or it would be reasonably likely that the Lenders would be materially and adversely affected were such Reserve not changed or established prior to the expiration of such two (2) Business Day period.
 
2.4   ­Making of Loans . (a)   .  (a)           Except as set forth in Sections 2.18 and 2.26, Loans (other than Swingline Loans) by the Lenders shall be either Prime Rate Loans or LIBO Loans as the Lead Borrower on behalf of the Borrowers may request subject to and in accordance with this Section 2.4, provided that all Swingline Loans shall be only Prime Rate Loans. All Loans made pursuant to the same Borrowing shall, unless otherwise specifically provided herein, be Loans of the same Type. Each Lender may fulfill its Commitment with respect to any Loan by causing any lending office of such Lender to make such Loan; but any such use of a lending office shall not affect the obligation of the Borrowers to repay such Loan in accordance with the terms of the applicable Note.  Each Lender shall, subject to its overall policy considerations, use reasonable efforts (but shall not be obligated) to select a lending office (or transfer its Loans to another lending office) which will not result in the payment of increased costs by the Borrowers pursuant to Section 2.25.  Subject to the other provisions of this Section 2.4 and the provisions of Section 2.26, Borrowings of Loans of more than one Type may be incurred at the same time, but no more than fifteen (15) Borrowings of LIBO Loans may be outstanding at any time.
 
(b)   The Lead Borrower shall give the Administrative Agent (i) in the case of each LIBO Borrowing, at least three (3) Business Days’, and (ii) in the case of each Borrowing of Prime Rate Loans on the date of the requested Borrowing, prior irrevocable written notice of borrowing (which may be by electronic transmission) delivered to the Administrative Agent in the form attached hereto as Exhibit F   Any such notice, to be effective, must be received by the Administrative Agent not later than 12:00 noon., Boston time, on the third Business Day in the case of LIBO Loans prior to the date, and on the same Business Day in the case of Prime Rate Loans, on which such Borrowing is to be made. Such notice shall be irrevocable and shall specify the amount of the proposed Borrowing (which shall be in an integral multiple of $1,000,000, but not less than $5,000,000 in the case of LIBO Loans) and the date thereof (which shall be a Business Day).  Unless otherwise directed in such notice and so long as no Cash Dominion Event has occurred and is continuing, the proceeds of Loans shall be credited to Account No. 5045183372 maintained by the Borrowers with Bank of America.  Such notice shall specify whether the Borrowing then being requested is to be a Borrowing of Prime Rate Loans or LIBO Loans and, if LIBO Loans, the Interest Period with respect thereto. If no election of Interest Period is specified in any such notice for a Borrowing of LIBO Loans, such notice shall be deemed a request for an Interest Period of one month. If no election is made as to the Type of Loan, such notice shall be deemed a request for a Borrowing of Prime Rate Loans. The Administrative Agent shall promptly notify each Lender of its proportionate share of such Borrowing, the date of such Borrowing, the Type of Borrowing being requested and the Interest Period or Interest Periods applicable thereto, as appropriate. On the borrowing date specified in such notice, each Lender shall make its share of the Borrowing available at the office of the Administrative Agent at 100 Federal Street, Boston, Massachusetts 02110, no later than 3:00 p.m., Boston time, in immediately available funds. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with this Section and may, in reliance upon such assumption, make available to the Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrowers severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrowers to but excluding the date of payment to the Admini­strative Agent, at (i) in the case of such Lender, the Federal Funds Effective Rate or (ii) in the case of the Borrowers, the interest rate applicable to Prime Rate Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing. Upon receipt of the funds made available by the Lenders to fund any Borrowing hereunder, the Administrative Agent shall disburse such funds in the manner specified in the notice of borrowing delivered by the Lead Borrower and shall use reasonable efforts to make the funds so received from the Lenders available to the Borrowers no later than 3:00 p.m., Boston time.
 
(c)   The Administrative Agent, without the request of the Lead Borrower, may, to the extent not timely paid, advance any interest, fee, service charge, or other payment to which any Agent or their Affiliates or any Lender is entitled from any Borrower pursuant hereto or any other Loan Document and may charge the same to the Loan Account notwithstanding that an Overadvance may result thereby.  The Administrative Agent shall advise the Lead Borrower in writing of any such advance or charge promptly after the making thereof. Such action on the part of the Administrative Agent shall not constitute a waiver of the Administrative Agent’s rights and each Borrower’s obligations under Section 2.4(a). Any amount which is added to the principal balance of the Loan Account as provided in this Section 2.4(c) shall bear interest at the interest rate then and thereafter applicable to Prime Rate Loans.
 
2.5   Overadvances . The Agents and the Lenders have no obligation to make any Loan or to provide any Letter of Credit or Acceptance if an Overadvance would result. The Administrative Agent may, in its discretion, make Permitted Overadvances without the consent of the Lenders and each Lender shall be bound thereby.  Any Permitted Overadvances may constitute Swingline Loans.  The making of any Permitted Overadvance is for the benefit of the Borrowers; such Permitted Overadvances constitute Revolving Loans and Obligations. The making of any such Permitted Overadvances on any one occasion shall not obligate the Administrative Agent or any Lender to make or permit any Permitted Overadvances on any other occasion or to permit such Permitted Overadvances to remain outstanding.
 
2.6   Swingline Loans .
 
(a)   The Swingline Lender is authorized by the Lenders and shall, subject to the provisions of this Section, make Swingline Loans up to $35,000,000 in the aggregate outstanding at any time (which requests for Borrowings of Swingline Loans shall be in minimum integrals of $500,000) consisting only of Prime Rate Loans, upon a notice of Borrowing received by the Administrative Agent and the Swingline Lender (which notice, at the Swingline Lender’s discretion, may be submitted prior to 1:00 p.m., Boston time, on the Business Day on which such Swingline Loan is requested). Swingline Loans shall be subject to periodic settlement with the Lenders under Section 2.8 below.
 
(b)   Swingline Loans may be made only in the following circumstances: (A) for administrative convenience, the Swingline Lender shall, at the Lead Borrower’s request, make Swingline Loans in reliance upon the Borrowers’ actual or deemed representations under Section 4.2, that the applicable conditions for borrowing are satisfied or (B) for Permitted Overadvances.  If the conditions for borrowing under Section 4.2 cannot be fulfilled at the time of a requested Swingline Loan, the Lead Borrower shall give immediate notice thereof to the Administrative Agent and the Swingline Lender (a “ Noncompliance Notice ”), and the Administrative Agent shall promptly provide each Lender with a copy of the Noncompliance Notice. If the conditions for borrowing under Section 4.2 cannot be fulfilled, the Required Lenders may direct the Swingline Lender to, and the Swingline Lender thereupon shall, cease making Swingline Loans (other than Permitted Overadvances) until such conditions can be satisfied or are waived in accordance with Section 9.2. Unless the Required Lenders so direct the Swingline Lender, the Swingline Lender may, but is not obligated to, continue to make Swingline Loans beginning one Business Day after the Non-Compliance Notice is furnished to the Lenders. Notwithstanding the foregoing, no Swingline Loans shall be made pursuant to this subsection (b) (other than Permitted Overadvances) if the aggregate outstanding amount of the Credit Extensions would exceed the  lower of (i)(x) $380,000,000, or (y) such greater amount or lesser amount to which the Total Commitments have then been increased or decreased by the Borrowers pursuant to Sections 2.2 and/or 2.17 hereof, or (ii) the then amount of the Borrowing Base.
 
2.7   ­Letters of Credit and Acceptances .
 
(a)   Letters of Credit Issued and Acceptances Created .
 
(i)   Letters of Credit Issued and Acceptances Created by the Issuing Banks .  Subject to the terms and conditions of this Agreement, if requested by the Lead Borrower on behalf of the Borrowers, each Issuing Bank agrees to issue one or more Commercial Letters of Credit or Standby Letters of Credit and one or more Acceptances, in each case denominated in Dollars, Canadian Dollars or Euros   (it being agreed and understood that an Acceptance may be rejected for payment by an Issuing Bank as an Acceptance Lender if it is not in compliance with any underlying application, agreement, or Letter of Credit relating thereto) for the account of any of the Borrowers (whether one or more) or in support of an obligation of any Loan Party or any of the Borrowers’ Subsidiaries which are not Loan Parties, in each case at any time and from time to time after the date hereof and prior to the Termination Date.
 
(ii)   Intentionally Omitted .
 
(iii)   In General .  No Letter of Credit or Acceptance shall be issued if after giving effect to such issuance (A) the aggregate Letter of Credit Outstandings shall exceed $100,000,000, (B) the aggregate Letter of Credit Outstandings with respect to Standby Letters of Credit shall exceed $50,000,000 or (C) the aggregate Credit Extensions would exceed the limitation set forth in Section 2.1(a)(i); and provided , further , that no Letter of Credit or Acceptance shall be issued if (i) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the applicable Issuing Bank or Acceptance Lender from issuing such Letter of Credit or Acceptance, or any law applicable to such Issuing Bank or Acceptance Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Bank or Acceptance Lender shall prohibit, or request that such Issuing Bank or Acceptance Lender refrain from, the issuance of letters of credit or acceptances generally or such Letter of Credit or Acceptance in particular or shall impose upon such Issuing Bank or Acceptance Lender with respect to such Letter of Credit or Acceptance any restriction, reserve or capital requirement (for which such Issuing Bank or Acceptance Lender is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such Issuing Bank or Acceptance Lender any unreimbursed loss, cost or expense (for which such Issuing Bank or Acceptance Lender is not otherwise compensated hereunder) which was not applicable on the Closing Date and which such Issuing Bank or Acceptance Lender in good faith deems material to it, (ii) the issuance of such Letter of Credit or Acceptance would violate one or more policies of such Issuing Bank or Acceptance Lender applicable to letters of credit or acceptances generally, (iii) a default of any Lender’s obligations to fund hereunder exists or any Lender is at such time a Defaulting Lender hereunder, unless such Issuing Bank or Acceptance Lender has entered into arrangements satisfactory to such Issuing Bank or Acceptance Lender with the Borrowers or such Lender to eliminate such Issuing Bank’s or Acceptance Lender’s risk with respect to such Lender, or (iv) such Issuing Bank or Acceptance Lender shall have received notice from the Administrative Agent or the Required Lenders that the conditions to such issuance have not been met.  Each Issuing Bank and Acceptance Lender (other than the Lead Issuing Bank or any of its Affiliates) shall notify the Administrative Agent in writing on each Business Day of all Letters of Credit and Acceptances issued on the prior Business Day by such Issuing Bank or Acceptance Lender, provided that (A) until the Administrative Agent advises any such Issuing Bank or Acceptance Lender that the provisions of Section 4.02 are not satisfied, or (B) the aggregate amount of the Letters of Credit and Acceptances issued in any such week exceeds such amount as shall be agreed by the Administrative Agent and such Issuing Bank or Acceptance Lender, such Issuing Bank or Acceptance Lender shall be required to so notify the Administrative Agent in writing only once each week of the Letters of Credit and Acceptances issued by such Issuing Bank or Acceptance Lender during the immediately preceding week as well as the daily amounts outstanding for the prior week, such notice to be furnished on such day of the week as the Administrative Agent and such Issuing Bank or Acceptance Lender may agree.
 
(b)   Each Standby Letter of Credit shall expire no later than the close of business on the earlier of (i) the date one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is ten (10) Business Days prior to the Maturity Date, provided that upon the request of the applicable Borrower and subject to the other requirements of this Section, the Leading Issuing Bank shall, and each other applicable Issuing Bank may, in its sole and absolute discretion, agree to issue one or more Standby Letters of Credit that have automatic extension provisions (each, an “ Auto-Extension Letter of Credit ”); provided that any such Auto-Extension Letter of Credit must permit such Issuing Bank to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Standby Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “ Non-Extension Notice Date ”) in each such twelve-month period to be agreed upon at the time such Standby Letter of Credit is issued.  Unless otherwise directed by the applicable Issuing Bank, the Lead Borrower shall not be required to make a specific request to such Issuing Bank for any such extension.  Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the applicable Issuing Bank to permit the extension of such Standby Letter of Credit at any time to an expiry date not later than the date that is ten (10) Business Days prior to the Maturity Date; provided , however , that such Issuing Bank shall not permit any such extension if (A) the applicable Issuing Bank has determined that it would not be permitted, or would have no obligation, at such time to issue such Standby Letter of Credit in its revised form (as extended) under the terms hereof, or (B) it has received notice (which may be by telephone or in writing) on or before the day that is five Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Lender or the Lead Borrower that one or more of the applicable conditions specified in Section 4.02 is not then satisfied, and in each such case directing such Issuing Bank not to permit such extension.
 
(c)   Each Commercial Letter of Credit shall expire no later than the close of business on the earlier of (i) the date 180 days after the date of the issuance of such Commercial Letter of Credit and (ii) the date that is ten (10) Business Days prior to the Maturity Date; provided that the applicable Borrower may request that the applicable Issuing Bank issue a Commercial Letter of Credit with an expiration date after the Maturity Date, provided further that with respect to any such Commercial Letter of Credit, the Borrowers shall deposit in the Cash Collateral Account an amount in cash equal to 105% of each such Letter of Credit Outstandings thirty (30) days prior to the Maturity Date.
 
(d)   Each Acceptance shall expire no later than the close of business on the earlier of (i) the date 180 days after the date of the issuance of such Acceptance and (ii) the date that is five (5) Business Days prior to the Maturity Date; provided that the applicable Borrower may request that the applicable Acceptance Lender issue an Acceptance with an expiration date after the Maturity Date, provided further that with respect to any such Acceptance, the Borrowers shall deposit in the Cash Collateral Account an amount in cash equal to 105% of each such Acceptance Letter of Credit Outstandings thirty (30) days prior to the Maturity Date.
 
(e)   Drafts drawn under any Letter of Credit or Acceptance shall be reimbursed by the Borrowers by paying to the Administrative Agent an amount equal to such drawing (together with interest as provided in Section 2.7(g)) not later than 1:00 p.m., Boston time, on the Business Day immediately following the day that the Lead Borrower receives notice of such drawing, provided that the Lead Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.4 that such payment be financed with a Revolving Loan consisting of a Prime Rate Loan, or a Swingline Loan in an equivalent amount and, to the extent so financed, the Borrowers’ obligation to make such payment shall be discharged and replaced by the resulting Prime Rate Loan or Swingline Loan. The applicable Issuing Bank or Acceptance Lender, as applicable, shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit or an Acceptance. The applicable Issuing Bank or Acceptance Lender, as applicable, shall promptly notify the Administrative Agent and the Lead Borrower by telephone (confirmed by telecopy) of such demand for payment and whether such Issuing Bank or Acceptance Lender, as applicable, has made or will make payment thereunder, provided that any failure to give or delay in giving such notice shall not relieve the Borrowers of their obligation to reimburse such Issuing Bank or Acceptance Lender and the Lenders with respect to any such payment.
 
(f)   If an Issuing Bank shall make any L/C Disbursement or an Acceptance Lender shall make any disbursement pursuant to an Acceptance, then, unless the Borrowers shall reimburse such Issuing Bank or Acceptance Lender, as applicable, in full on the date such payment is made, the unpaid amount thereof shall bear interest, for each day from the including the date such payment is made to but excluding the date that the Borrowers reimburse such Issuing Bank or Acceptance Lender, as applicable, therefor, at the rate per annum then applicable to Prime Rate Loans, provided that if the Borrowers fail to reimburse such Issuing Bank or Acceptance Lender, as applicable, when due pursuant to paragraph (e) of this Section, then Section 2.11 shall apply. Interest accrued pursuant to this paragraph shall be for the account of such Issuing Bank or Acceptance Lender, as applicable, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (h) of this Section to reimburse such Issuing Bank or Acceptance Lender, as applicable, shall be for the account of such Lender to the extent of such payment.
 
(g)   Immediately upon the issuance of any Letter of Credit by an Issuing Bank (or the amendment of a Letter of Credit increasing the amount thereof) or the issuance of any Acceptance by an Acceptance Lender (or the amendment of an Acceptance increasing the amount thereof), and without any further action on the part of such Issuing Bank or Acceptance Lender, such Issuing Bank or Acceptance Lender, as applicable, shall be deemed to have sold to each Lender, and each such Lender shall be deemed unconditionally and irrevocably to have purchased from such Issuing Bank or Acceptance Lender, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Commitment Percentage, in such Letter of Credit or Acceptance, each drawing thereunder and the obligations of the Borrowers under this Agreement and the other Loan Documents with respect thereto. Upon any change in the Commitments pursuant to Section 2.2, 2.17, and/or 9.5, it is hereby agreed that with respect to all Letter of Credit Outstandings, there shall be an automatic adjustment to the participations hereby created to reflect the new Commitment Percentages of the assigning and assignee Lenders and any Additional Commitment Lender.   Any action taken or omitted by such Issuing Bank or Acceptance Lender under or in connection with a Letter of Credit or Acceptance, if taken or omitted in the absence of gross negligence, bad faith or willful misconduct, shall not create for such Issuing Bank or Acceptance Lender, as applicable, any resulting liability to any Lender.
 
(h)   In the event that an Issuing Bank makes any L/C Disbursement or an Acceptance Lender makes any disbursement pursuant to an Acceptance, and the Borrowers shall not have reimbursed such amount in full to such Issuing Bank or Acceptance Lender, as applicable, pursuant to Section 2.7(e), such Issuing Bank or Acceptance Lender, as applicable, shall promptly notify the Administrative Agent, which shall promptly notify each Lender of such failure, and each Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Issuing Bank or Acceptance Lender, as applicable, the amount of such Lender’s Commitment Percentage of such unreimbursed payment and in same day funds. If such Issuing Bank or Acceptance Lender, as applicable, so notifies the Administrative Agent, and the Administrative Agent so notifies the Lenders prior to 12:00 noon, Boston time, on any Business Day, each such Lender shall make available to such Issuing Bank or Acceptance Lender, as applicable, such Lender’s Commitment Percentage of the amount of such payment on such Business Day in same day funds (or if such notice is received by the Lenders after 12:00 noon., Boston time on the day of receipt, payment shall be made on the immediately following Business Day).  If and to the extent such Lender shall not have so made its Commitment Percentage of the amount of such payment available to such Issuing Bank or Acceptance Lender, as applicable, such Lender agrees to pay to such Issuing Bank or Acceptance Lender, as applicable, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent for the account of such Issuing Bank or Acceptance Lender, as applicable, at the Federal Funds Effective Rate. Each Lender agrees to fund its Commitment Percentage of such unreimbursed payment notwithstanding a failure to satisfy any applicable lending conditions or the provisions of Sections 2.1 or 2.7, or the occurrence of the Termination Date. The failure of any Lender to make available to such Issuing Bank or Acceptance Lender, as applicable, its Commitment Percentage of any payment under any Letter of Credit or Acceptance shall neither relieve any Lender of its obligation hereunder to make available to such Issuing Bank or Acceptance Lender, as applicable, its Commitment Percentage of any payment under any Letter of Credit or Acceptance on the date required, as specified above, nor increase the obligation of such other Lender. Whenever any Lender has made payments to an applicable Issuing Bank or Acceptance Lender, as applicable, in respect of any reimbursement obligation for any Letter of Credit or Acceptance, such Lender shall be entitled to share ratably, based on its Commitment Percentage, in all payments and collections thereafter received on account of such reimbursement obligation.
 
(i)   Whenever the Borrowers desire that an Issuing Bank issue a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit) or that an Acceptance Lender issue an Acceptance (or the amendment, renewal or extension of an outstanding Acceptance), the Lead Borrower shall give to such Issuing Bank or Acceptance Lender, as applicable, and the Administrative Agent at least three (3) Business Days’ prior written (including telegraphic, telex, facsimile or cable communication) notice (or such shorter period as may be agreed upon in writing by such Issuing Bank or Acceptance Lender, as applicable and Lead Borrower) specifying the date on which the proposed Letter of Credit or Acceptance is to be issued, amended, renewed or extended (which shall be a Business Day), the stated amount of the Letter of Credit or Acceptance so requested, the expiration date of such Letter of Credit or Acceptance, the name and address of the beneficiary thereof, and the provisions thereof. If requested by such Issuing Bank or Acceptance Lender, as applicable, the Borrowers shall also submit a letter of credit application on such Issuing Bank’s or Acceptance Lender’s, as applicable, standard form in connection with any request for the issuance, amendment, renewal or extension of a Letter of Credit or Acceptance.
 
(j)   The obligations of the Borrowers to reimburse the applicable Issuing Bank for any L/C Disbursement and the applicable Acceptance Lender for any disbursement pursuant to an Acceptance shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including, without limitation: (i) any lack of validity or enforceability of any Letter of Credit or Acceptance; (ii) the existence of any claim, setoff, defense or other right which the Borrowers may have at any time against a beneficiary of any Letter of Credit or Acceptance or against such Issuing Bank or Acceptance Lender, as applicable, or any of the Lenders, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction; (iii) any draft, demand, certificate or other document presented under any Letter of Credit or Acceptance proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iv) payment by such Issuing Bank or Acceptance Lender, as applicable, of any Letter of Credit or Acceptance against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit or Acceptance; (v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrowers’ obligations hereunder; or (vi) the fact that any Event of Default shall have occurred and be continuing. None of the Administra­tive Agent, the Lenders, the Issuing Banks, the Acceptance Lenders or any of their Affiliates shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or Acceptance or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit or Acceptance (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the applicable Issuing Bank or Acceptance Lender, provided that the foregoing shall not be construed to excuse such Issuing Bank or Acceptance Lender, as applicable, from liability to the Borrowers to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrowers to the extent permitted by Applicable Law) suffered by the Borrowers that are caused by such Issuing Bank’s or Acceptance Lender’s, as applicable, failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit or Acceptance comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence, bad faith or willful misconduct on the part of any Issuing Bank or Acceptance Lender, as applicable (as finally determined by a court of competent jurisdiction), such Issuing Bank or Acceptance Lender, as applicable, shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented that appear on their face to be in compliance with the terms of a Letter of Credit or Acceptance, the applicable Issuing Bank or Acceptance Lender, as applicable, may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit or Acceptance.
 
(k)   If any Event of Default shall occur and be continuing, on the Business Day that the Lead Borrower receives notice from the Administra­tive Agent or the Required Lenders demanding the deposit of cash collateral pursuant to this paragraph, the Borrowers shall deposit in the Cash Collateral Account an amount in cash equal to 105% of the Letter of Credit Outstandings as of such date plus any accrued and unpaid interest thereon. Each such deposit shall be held by the Collateral Agent as collateral for the payment and performance of the Obligations of the Borrowers under this Agreement. The Collateral Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such Cash Collateral Account. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Collateral Agent at the request of the Lead Borrower and at the Borrowers’ risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such Cash Collateral Account shall be applied by the Collateral Agent to reimburse the applicable Issuing Bank for payments on account of drawings under Letters of Credit for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrowers for the Letter of Credit Outstandings at such time or, if the Loans have matured or the maturity of the Loans has been accelerated, be applied to satisfy other Obligations of the Borrowers under this Agreement.
 
(l)   The Borrowers, the Administrative Agent and the Lenders agree that the Existing Letters of Credit shall be deemed Letters of Credit hereunder as if issued by an Issuing Bank, and the Existing Acceptances shall be deemed Acceptances hereunder as if issued by an Acceptance Lender.
 
(m)   For purposes of calculating the outstanding Credit Extensions, the Administrative Agent shall, monthly or more frequently in the Administrative Agent’s sole discretion, make the necessary exchange rate calculations for any Letters of Credit denominated in currency other than Dollars, to determine whether any such excess exists on such date.
 
(n)   All reimbursements to be made by the Loan Parties with respect to Letters of Credit shall be made in Dollars or in such other currency as the Letter of Credit is denominated.  All participations in Letters of Credit by the Lenders shall be made in such currency as the Letter of Credit is denominated or in the Dollar Equivalent thereof.
 
2.8   ­Settlements Amongst Lenders .    (a)           The Swingline Lender may, at any time, and shall, not less frequently than weekly, on behalf of the Borrowers (which hereby authorize the Swingline Lender to act in their behalf in that regard) request the Administrative Agent to cause the Lenders to make a Revolving Loan (which shall be a Prime Rate Loan) in an amount equal to such Lender’s Commitment Percentage of the outstanding amount of Swingline Loans made in accordance with Section 2.6, which request may be made regardless of whether the conditions set forth in Section 4 have been satisfied. Upon such request, each Lender shall make available to the Administrative Agent the proceeds of such Revolving Loan for the account of the Swingline Lender. If the Swingline Lender requires a Revolving Loan to be made by the Lenders and the request therefor is received at or prior to 1:00 p.m., Boston time, on a Business Day, such transfers shall be made in immediately available funds no later than 3:00 p.m., Boston time, that day; and, if the request therefor is received after 1:00 p.m., Boston time, then no later than 3:00 p.m., Boston time, on the next Business Day. The obligation of each Lender to transfer such funds is irrevocable, unconditional and without recourse to or warranty by the Administrative Agent or the Swingline Lender. If and to the extent any Lender shall not have so made its transfer to the Administrative Agent, such Lender agrees to pay to the Administrative Agent, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent at the Federal Funds Effective Rate.
 
(b)   The amount of each Lender’s Commitment Percentage of outstanding Revolving Loans (and Swingline Loans) shall be computed weekly (or more frequently in the Administrative Agent’s discretion) and shall be adjusted upward or downward based on all Revolving Loans and repayments of Revolving Loans and Swingline Loans received by the Administrative Agent as of 3:00 p.m., Boston time, on the first Business Day following the end of the period specified by the Administrative Agent (such date, the “ Settlement Date ”).
 
(c)   The Administrative Agent shall deliver to each of the Lenders promptly after the Settlement Date a summary statement of the amount of outstanding Revolving Loans and Swingline Loans for the period and the amount of repayments received for the period. As reflected on the summary statement: each Lender shall transfer to the Administrative Agent (as provided below), or the Administrative Agent shall transfer to each Lender, such amounts as are necessary to insure that, after giving effect to all such transfers, the amount of Revolving Loans made by each Lender shall be equal to such Lender’s applicable Commitment Percentage of Revolving Loans outstanding as of such Settlement Date. If the summary statement requires transfers to be made to the Administrative Agent by the Lenders and is received at or prior to 1:00 p.m., Boston time, on a Business Day, such transfers shall be made in immediately available funds no later than 3:00 p.m., Boston time, that day; and, if received after 1:00 p.m., Boston time, then no later than 3:00 p.m., Boston time, on the next Business Day. The obligation of each Lender to transfer such funds is irrevocable, unconditional and without recourse to or warranty by the Administrative Agent. If and to the extent any Lender shall not have so made its transfer to the Administrative Agent, such Lender agrees to pay to the Administrative Agent, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent at the Federal Funds Effective Rate.
 
2.9   ­Notes; Repayment of Loans .    To the extent requested by a Lender, the Loans made by such Lender shall be evidenced by a Note duly executed on behalf of the Borrowers, dated the Closing Date, in substantially the form attached hereto as Exhibit B , payable to the order of such Lender in an aggregate principal amount equal to such Lender’s Commitment.
 
(b)   Each Lender is hereby authorized by the Borrower to endorse on a schedule attached to each Note delivered to such Lender (or on a continuation of such schedule attached to such Note and made a part thereof), or otherwise to record in such Lender’s internal records, an appropriate notation evidencing the date and amount of each Loan from such Lender, each payment and prepayment of principal of any such Loan, each payment of interest on any such Loan and the other information provided for on such schedule; provided , however , that the failure of any Lender to make such a notation or any error therein shall not affect the obligation of the Borrowers to repay the Loans made by such Lender in accordance with the terms of this Agreement and the applicable Notes.
 
(c)   Upon receipt of an affidavit of a Lender as to the loss, theft, destruction or mutilation of such Lender’s Note and an indemnity in form and substance reasonably satisfactory to the Lead Borrower, and upon cancellation of such Note, the Borrowers will issue, in lieu thereof, a replacement Note in favor of such Lender, in the same principal amount thereof and otherwise of like tenor.
 
2.10   ­Interest on Loans .       (a)      Subject to Section 2.11, each Prime Rate Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum that shall be equal to the then Prime Rate, plus the Applicable Margin for Prime Rate Loans.
 
(b)   Subject to Section 2.11, each LIBO Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum equal, during each Interest Period applicable thereto, to the Adjusted LIBO Rate for such Interest Period, plus the Applicable Margin for LIBO Loans.
 
(c)   Accrued interest on all Loans shall be payable in arrears on each Interest Payment Date applicable thereto, on the Termination Date, after the Termination Date on demand and (with respect to LIBO Loans) upon any repayment or prepayment thereof (on the amount prepaid).
 
2.11   ­Default Interest .  Effective upon the occurrence of any Event of Default and at all times thereafter while such Event of Default is continuing, at the option of the Administrative Agent or upon the direction of the Required Lenders, interest shall accrue on all outstanding Loans (including Swingline Loans) (after as well as before judgment, as and to the extent permitted by law) at a rate per annum (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) equal to the rate (including the Applicable Margin for Loans) in effect from time to time plus 2.00% per annum, and such interest shall be payable on demand.
 
2.12   ­Certain Fees .  The Borrowers shall pay to the Administrative Agent, for the account of the Administrative Agent, the fees set forth in the Fee Letter as and when payment of such fees is due as therein set forth.
 
2.13   Commitment Fee .   The Borrowers shall pay to the Administrative Agent for the account of the Lenders, a commitment fee (the “ Commitment Fee ”) equal to the Applicable Commitment Fee Percentage (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable), multiplied by the average daily balance of the Unused Commitment for each day commencing on and including the Closing Date and ending on but excluding the Termination Date.
 
The Commitment Fee so accrued in any calendar quarter shall be payable on or prior to the fifteenth day of each January, April, July, and October, in arrears, commencing April 15, 2009, except that all Commitment Fees so accrued as of the Termination Date shall be payable on the Termination Date.  The Administrative Agent shall pay the Commitment Fee to the Lenders based upon their Commitment Percentages.
 
2.14   ­Letter of Credit Fees   .  (a)           The Borrowers shall pay the Administrative Agent, for the account of the Lenders in accordance with their respective Commitment Percentages, on the fifteenth day of each January, April, July and October, in arrears, a fee (each, a “ Letter of Credit Fee ”) equal to the following per annum percentages multiplied by the face amount of each of the following categories of Letters of Credit outstanding during the subject quarter:
 
(i)   Each Standby Letter of Credit:  At the then Applicable Margin per annum for LIBO Loans.
 
(ii)   Each Commercial Letter of Credit:  At the then Applicable Commercial Letter of Credit Fee.
 
(iii)   After the occurrence and during the continuance of an Event of Default, at the option of the Administrative Agent or upon the direction of the Required Lenders, the Letter of Credit Fees set forth in clauses (i) and (ii) above, shall be increased by an amount equal to two percent (2%) per annum.
 
(b)   The Borrowers shall pay to the applicable Issuing Bank for its own account a fronting fee (the “Fronting Fee”) with respect to each Letter of Credit issued by it, at a rate equal to 0.125% per cent per annum, computed on the amount of such Letter of Credit, and payable on the fifteenth day of each January, April, July and October, in arrears.  In addition, the Borrowers shall pay to the applicable Issuing Bank, in addition to the Letter of Credit Fees otherwise provided for hereunder, fees and charges in connection with the issuance, negotiation, settlement, amendment and processing of each Letter of Credit issued by such Issuing Bank in the amounts as such Issuing Bank and the Lead Borrower may agree.
 
(c)   All Letter of Credit Fees shall be computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable.
 
2.15   Acceptance Fee .  Subject to Section 9.14, the Borrowers agree to pay to the Administrative Agent, for the account of the Lenders, in accordance with their respective Commitment Percentages, for each Acceptance, a fee (the “ Acceptance Fee ”) equal to the Acceptance Fee Percentage, multiplied by the face amount of each Acceptance, plus all reasonable out-of-pocket costs, fees, and expenses incurred by the applicable Acceptance Lender in connection with the application for, processing of, issuance of, or amendment to any Acceptance.  The Acceptance Fee shall be payable in arrears on the fifteenth day of each January, April, July, and October and on the Termination Date for any three (3) month period, or shorter period if calculated for the period beginning on the Closing Date or for such period ending on the Termination Date, in which an Acceptance was issued and/or in which an Acceptance remained outstanding.  After the occurrence and during the continuance of an Event of Default, at the option of the Administrative Agent or upon the direction of the Required Lenders, the Acceptance Fee shall be increased by an amount equal to two percent (2%) per annum.  Subject to Section 9.14, the Acceptance Fee shall be computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable.  In addition, the Borrowers shall pay to the Acceptance Lender for its own account a fronting fee with respect to each Acceptance, at a rate equal to 0.125% per cent per annum, computed on the amount of such Acceptance, computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable, and payable on the fifteenth day of each January, April, July and October, in arrears.
 
2.16   ­Nature of Fees .  All fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent, for the respective accounts of the Administrative Agent, the Issuing Banks, the Acceptance Lenders and the Lenders, as provided herein. All fees shall be fully earned on the date when due and shall not be refundable under any circumstances.
 
2.17   ­Termination or Reduction of Commitments .  Upon at least ten (10) Business Days’ prior written notice to the Administrative Agent, the Lead Borrower may at any time in whole permanently terminate the Total Commitments. In addition, upon at least five (5) Business Days’ prior written notice to the Administrative Agent, the Lead Borrower may at any time in part permanently reduce the Total Commitments. Each such reduction shall be in the principal amount of $5,000,000 or any multiple of $5,000,000; provided that the Borrowers shall not terminate or reduce (A) the Total Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Credit Extensions outstanding would exceed the Total Commitments, (B) the sublimit for Letters of Credit set forth in Section 2.1(a)(ii) if, after giving effect thereto, the Letter of Credit Oustandings not fully cash collateralized hereunder would exceed such sublimit, and (C) the sublimit for Swingline Loans set forth in Section 2.6(a) hereof if, after giving effect thereto, and to any concurrent payments hereunder, the outstanding amount of Swingline Loans hereunder would exceed such sublimit. If, after giving effect to any reduction of the Total Commitments, the sublimit for Letters of Credit set forth in Section 2.1(a)(ii) hereof or the sublimit for Swingline Loans set forth in Section 2.6(a) hereof exceeds the amount of the Total Commitments, such sublimits shall be automatically reduced by the amount of such excess.  Each such reduction or termination shall (i) be applied ratably to the Commitment of each Lender and (ii) be irrevocable when given. At the effective time of each such reduction or termination, the Borrowers shall pay to the Administrative Agent for application as provided herein (i) all Commitment Fees accrued on the amount of the Total Commitments so terminated or reduced through the date thereof, (ii) any amount by which the Credit Extensions outstanding on such date exceed the amount to which the Total Commitments are to be reduced effective on such date, in each case pro rata based on the amount prepaid, and (iii) any Breakage Costs, if applicable.
 
2.18   ­Alternate Rate of Interest .  If prior to the commence­ment of any Interest Period for a LIBO Borrowing:
 
(a)   the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or
 
(b)   the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;
 
then the Administrative Agent shall give notice thereof to the Lead Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter (but in any event, within two (2) Business Days) and, until the Administrative Agent notifies the Lead Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Borrowing Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a LIBO Borrowing shall be ineffective and (ii) if any Borrowing Request requests a LIBO Borrowing, such Borrowing shall be made as a Borrowing of Prime Rate Loans.
 
2.19   ­Conversion and Continuation of Loans .  The Lead Borrower on behalf of the Borrowers shall have the right at any time,
 
(a)   on three (3) Business Days’ prior irrevocable notice to the Administrative Agent (which notice, to be effective, must be received by the Administrative Agent not later than 12:00 noon, Boston time, on the third Business Day preceding the date of any conversion), (x) to convert any outstanding Borrowings of  Prime Rate Loans (but in no event Swingline Loans) to Borrowings of LIBO Loans, or (y) to continue an outstanding Borrowing of LIBO Loans for an additional Interest Period,
 
(b)   on one Business Day’s irrevocable notice to the Administrative Agent (which notice, to be effective, must be received by the Administrative Agent not later than 12:00 noon, Boston time, on the date of any conversion), to convert any outstanding Borrowings of LIBO Loans to a Borrowing of  Prime Rate Loans,
 
subject to the following:
 
(i)   without the consent of the Required Lenders, no Borrowing of Loans may be converted into, or continued as, LIBO Loans at any time when an Event of Default has occurred and is continuing;
 
(ii)   if less than a full Borrowing of Loans is converted, such conversion shall be made pro rata among the Lenders, as applicable, in accordance with the respective principal amounts of the Loans comprising such Borrowing held by such Lenders immediately prior to such conversion;
 
(iii)   the aggregate principal amount of Loans being converted into or continued as LIBO Loans shall be in an integral of $1,000,000 and at least $5,000,000;
 
(iv)   each Lender shall effect each conversion by applying the proceeds of its new LIBO Loan or Prime Rate Loan, as the case may be, to its Loan being so converted;
 
(v)   the Interest Period with respect to a Borrowing of LIBO Loans effected by a conversion or in respect to the Borrowing of LIBO Loans being continued as LIBO Loans shall commence on the date of conversion or the expiration of the current Interest Period applicable to such continued Borrowing, as the case may be;
 
(vi)   a Borrowing of LIBO Loans may be converted only on the last day of an Interest Period applicable thereto;
 
(vii)   each request for a conversion or continuation of a Borrowing of LIBO Loans which fails to state an applicable Interest Period shall be deemed to be a request for an Interest Period of one month; and
 
(viii)   no more than fifteen (15) Borrowings of LIBO Loans may be outstanding at any time.
 
If the Lead Borrower does not give notice to convert any Borrowing of Prime Rate Loans, or does not give notice to continue, or does not have the right to continue, any Borrowing as LIBO Loans, in each case as provided above, such Borrowing shall automatically be converted to, or continued as, as applicable, a Borrowing of Prime Rate Loans at the expiration of the then current Interest Period. The Administrative Agent shall, after it receives notice from the Borrower, promptly give each Lender notice of any conversion, in whole or part, of any Loan made by such Lender.
 
2.20   ­Mandatory Prepayment; Cash Collateral; Commitment Termination .  T he outstanding Obligations shall be subject to mandatory prepayment as follows:
 
(a)   If at any time the amount of the Credit Extensions exceeds the lower of (i) the then amount of the Total Commitments, and (ii) the then amount of the Borrowing Base, the Borrowers will immediately upon notice from the Administrative Agent (which may be given by the Administrative Agent in its discretion and shall be given by the Administrative Agent upon the request of the Required Lenders) (A) prepay the Loans in an amount necessary to eliminate such excess, and (B) if, after giving effect to the prepayment in full of all outstanding Loans such excess has not been eliminated, deposit cash into the Cash Collateral Account in an amount equal to 105% of the Letter of Credit Outstandings.  Without in any way limiting the foregoing, the Administrative Agent shall, weekly or more frequently in the Administrative Agent’s Permitted Discretion, make the necessary exchange rate calculations with respect to Letters of Credit denominated in a currency other than Dollars, to determine whether any excess exists on such date.
 
(b)   To the extent required pursuant to Section 2.23, the Revolving Loans shall be repaid daily in accordance with the provisions of said Section 2.23.
 
(c)   Subject to the foregoing, outstanding Prime Rate Loans shall be prepaid before outstanding LIBO Loans are prepaid. Each partial prepayment of LIBO Loans shall be in an integral multiple of $1,000,000. No prepayment of LIBO Loans shall be permitted pursuant to this Section 2.20 other than on the last day of an Interest Period applicable thereto, unless the Borrowers reimburse the Lenders for all Breakage Costs associated therewith in accordance with Section 2.21(b) below. In order to avoid such Breakage Costs, as long as no Event of Default has occurred and is continuing, the Administrative Agent shall hold all amounts required to be applied to LIBO Loans in the Cash Collateral Account and will apply such funds to the applicable LIBO Loans at the end of the then pending Interest Period therefor and such LIBO Loans shall continue to bear interest at the rate set forth in Section 2.10 until the amounts in the Cash Collateral Account have been so applied (provided that the foregoing shall in no way limit or restrict the Agents’ rights upon the subsequent occurrence of an Event of Default). No partial prepayment of a Borrowing of LIBO Loans shall result in the aggregate principal amount of the LIBO Loans remaining outstanding pursuant to such Borrowing being less than $5,000,000 (unless all such outstanding LIBO Loans are being prepaid in full). Any prepayment of the Revolving Loans shall not permanently reduce the Commitments.
 
(d)   All amounts required to be applied to all Loans hereunder (other than Swingline Loans) shall be applied ratably in accordance with each Lender’s Commitment Percentage.
 
(e)   Upon the Termination Date, the Commitments and the credit facility provided hereunder shall be terminated in full and the Borrowers shall pay, in full and in cash, all outstanding Loans and all other outstanding Obligations then due, and shall fully cash collateralize or replace all Letters of Credit and Acceptances and reimburse all L/C Disbursements and shall provide collateral security to the extent required by Section 9.6 hereof.
 
2.21   ­Optional Prepayment of Loans; Reimbursement of Lenders .  (a)           The Borrowers shall have the right at any time and from time to time to prepay outstanding Loans in whole or in part, (x) with respect to LIBO Loans, upon at least two Business Days’ prior written, telex or facsimile notice to the Administrative Agent prior to 12:00 noon, Boston time, and (y) with respect to Prime Rate Loans, upon written, telex or facsimile notice to the Administrative Agent prior to 12:00 noon, Boston time, on the date of prepayment, subject to the following limitations:
 
(i)   All prepayments under Section 2.20 and this Section 2.21 shall be paid to the Administrative Agent for application, first , to the prepayment of outstanding Swingline Loans, second , to the prepayment of other outstanding Loans ratably in accordance with each Lender’s Commitment Percentage, and third , to the funding of a cash collateral deposit in the Cash Collateral Account in an amount equal to 105% of all Letter of Credit Outstandings to the extent required by this Agreement.
 
(ii)   Subject to the foregoing, outstanding Prime Rate Loans shall be prepaid before outstanding LIBO Loans are prepaid. Each partial prepayment of LIBO Loans shall be in an integral multiple of $1,000,000. No prepayment of LIBO Loans shall be permitted pursuant to this Section 2.21 other than on the last day of an Interest Period applicable thereto, unless the Borrowers reimburse the Lenders for all Breakage Costs associated therewith in accordance with Section 2.21(b) below. No partial prepayment of a Borrowing of LIBO Loans shall result in the aggregate principal amount of the LIBO Loans remaining outstanding pursuant to such Borrowing being less than $5,000,000 (unless all such outstanding LIBO Loans are being prepaid in full).
 
(iii)   Each notice of prepayment shall specify the prepayment date, the principal amount and Type of the Loans to be prepaid and, in the case of LIBO Loans, the Borrowing or Borrowings pursuant to which such Loans were made. Each notice of prepayment shall be irrevocable and shall commit the Borrowers to prepay such Loan by the amount and on the date stated therein. The Administrative Agent shall, promptly after receiving notice from the Lead Borrower hereunder, notify each Lender of the principal amount and Type of the Loans held by such Lender which are to be prepaid, the prepayment date and the manner of application of the prepayment.
 
(b)   The Borrowers shall reimburse each Lender for any loss incurred or to be incurred by it in the reemployment of the funds released resulting from (i) any prepayment (for any reason whatsoever, including, without limitation, conversion to Prime Rate Loans or acceleration by virtue of, and after, the occurrence of an Event of Default) of any LIBO Loan required or permitted under this Agreement, if such Loan is prepaid other than on the last day of the Interest Period for such Loan, (ii) the failure of a Borrower to borrow a LIBO Loan for any reason on the first day of the applicable Interest Period after the Lead Borrower delivers a notice of borrowing under Section 2.4 in respect thereof, or (iii) the failure of the Borrowers to prepay any Loan on the date specified in any prepayment notice delivered pursuant to Section 2.21(a). Such loss shall be the amount as reasonably determined by such Lender as the excess, if any, of (A) the amount of interest which would have accrued to such Lender on the amount so paid or not borrowed at a rate of interest equal to the Adjusted LIBO Rate  for such Loan, for the period from the date of such payment or failure to borrow to the last day (x) in the case of a payment or refinancing of a LIBO Loan other than on the last day of the Interest Period for such Loan, of the then current Interest Period for such Loan or (y) in the case of such failure to borrow, of the Interest Period for such LIBO Loan which would have commenced on the date of such failure to borrow, over (B) the amount of interest which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the London interbank market (collectively, “ Breakage Costs ”). Any Lender demanding reimbursement for such loss shall deliver to the Lead Borrower from time to time one or more certificates setting forth the amount of such loss as determined by such Lender and setting forth in reasonable detail the manner in which such amount was determined.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be presumptively correct absent manifest error. The Borrowers shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt of such certificate; provided , however, that if any Breakage Costs are incurred as a result of repayment of Loans on the Maturity Date or the refinancing of this credit facility and so long as the amount of such Breakage Costs is included as part of the payoff amount set forth in the relevant payoff letter and the relevant Lender has delivered the certificate required hereby, payment of such Breakage Costs shall be made on the date of such termination or the Maturity Date, as applicable.
 
(c)   Intentionally Omitted.
 
(d)   Whenever any partial prepayment of Loans are to be applied to LIBO Loans, such LIBO Loans shall be prepaid in the chronological order of their Interest Payment Dates.
 
2.22   ­Maintenance of Loan Account; Statements of Account   . (a)           The Administrative Agent shall maintain an account on its books in the name of the Borrowers (the “ Loan Account ”) which will reflect (i) all Loans and other advances made by the Lenders to the Borrowers or for the Borrowers’ account, (ii) all L/C Disbursements, fees and interest that have become payable as herein set forth, and (iii) any and all other monetary Obligations that have become payable.
 
(b)   The Loan Account will be credited with all amounts received by the Administrative Agent from the Borrowers or otherwise for the Borrowers’ account, including all amounts received in the Concentration Account from the Blocked Account Banks, and the amounts so credited shall be applied as set forth in Section 2.24(a).
 
(c)   After the end of each month, (i) each Lender shall furnish a written statement to the Administrative Agent and the Lead Borrower setting forth the amount of obligations due to such Lender or its Affiliate (other than customary fees and expenses charged in the ordinary course) on account of Bank Products and Cash Management Services as of such month end, and (ii) the Administrative Agent shall send to the Lead Borrower a statement accounting for the charges, loans, advances and other transactions occurring among and between the Administrative Agent, the Lenders and the Borrowers during that month (other than on account of Bank Products and Cash Management Services). The monthly statements shall, absent manifest error, be an account stated, which is presumptively correct unless the Lead Borrower provides the Administrative Agent with a written objection to any such statement within twenty (20) days of receipt of such statement, which written objection shall state with particularity the reason for such objection.
 
2.23   ­Cash Receipts .    (a)           The Collateral Agent shall maintain account number 5045183372   at Bank of America (the “ Concentration Account ”).  Subject to the rights of the Loan Parties set forth below during any period during which no Cash Dominion Event has occurred and is continuing, the Concentration Account is and shall remain, under the sole dominion and control of the Collateral Agent.  The Loan Parties may maintain one or more disbursement accounts (the “ Disbursement Accounts ”) to be used by the Loan Parties for disbursements and payments (including payroll) in the ordinary course of business or as otherwise permitted hereunder.
 
(b)   All cash receipts and other proceeds from the sale or disposition of any Collateral relating to the Loan Parties’ operations in the United States of America or Canada, as applicable, including, without limitation, the proceeds of all credit card charges (all such cash receipts and proceeds, “ Cash Receipts ”) shall be deposited into one or more DDAs established for the account of the applicable Loan Party in the United States of America or Canada, as applicable.  Notwithstanding the foregoing, Cash Receipts from the Loan Parties’ wholesale operations in the United States of America or Canada, as applicable (whether received in a lockbox or otherwise) shall, promptly on receipt, be deposited directly in or transferred by ACH or wire transfer to the Concentration Account or a Blocked Account.
 
(c)   So long as no Cash Dominion Event has occurred and is continuing:
 
(i)   the Loan Parties may direct, and shall have sole control over, the manner of disposition of its funds in the DDA Accounts, the Blocked Accounts, the Concentration Account and each Disbursement Account and may close or change the services provided in respect of DDA Accounts, Blocked Accounts and Disbursement Accounts, provided that in the case of a closure of a Blocked Account, the funds on deposit therein shall be transferred to another Blocked Account or the Concentration Account; and
 
(ii)   the Loan Parties shall cause the ACH or wire transfer of all available and collected Cash Receipts in each such DDA to a Blocked Account or the Concentration Account not less frequently than each Business Day (or with respect to the Loan Parties situated in Canada, not less frequently than twice each week), provided that (A) to the extent that on any Business Day technical problems prevent any such ACH or wire, such funds shall be transferred on the next following Business Day on which technical problems do not prevent such transfer and (B) notwithstanding the foregoing, the Loan Parties need not cause the ACH or wire transfer from a DDA to a Blocked Account or the Concentration Account such reasonable amount (based upon prior business practices of the Borrowers but in no event to exceed $50,000.00 (or such higher amount as the Administrative Agent in its Permitted Discretion determines) for any single DDA or $250,000.00 (or such higher amount as the Administrative Agent in its Permitted Discretion determines) in the aggregate for all DDAs as is necessary or appropriate to cover dishonored checks, credit card chargebacks, bank fees and similar charges, in each case in the ordinary course of business.
 
(d)   After the occurrence and during the continuation of a Cash Dominion Event:
 
(i)   at the request of Administrative Agent, the Loan Parties shall deliver to the Administrative Agent (A) a list of all present DDAs maintained by the Loan Parties, which list includes, with respect to each depository (1) the name and address of that depository; (2) the account number(s) maintained with such depository; and (3) to the extent known, a contact person at such depository (the “DDA List”), and (B) deliver to the Administrative Agent notifications (the “ Credit Card Notifications ”) substantially in the form of Exhibit G hereto (or such other form as may be reasonably satisfactory to the Administrative Agent) executed on behalf of the Loan Parties with each of the Loan Parties’ major credit card processors;
 
(ii)   (x) no Borrower shall have any access to or right of withdrawal from the Concentration Account, (y) upon notice to a Blocked Account Bank, no Borrower shall have any access to or right of withdrawal from the Blocked Accounts maintained with such Blocked Account Bank, and (z) the funds on deposit in the Concentration Account shall continue to be collateral security for all of the Obligations and shall be applied as provided in Section 2.24;
 
(iii)   upon the Administrative Agent’s instruction, the Loan Parties shall cause the ACH or wire transfer to any Blocked Account or the Concentration Account (whether or not there is then an outstanding balance in the Loan Account, unless the Commitments have been terminated hereunder and the Obligations have been paid in full) of all available and collected Cash Receipts in each such DDA, provided that (i) the Administrative Agent shall not require more than one such transfer each day, (ii) to the extent that on any Business Day technical problems prevent any such ACH or wire, such funds shall be transferred on the next following Business Day on which technical problems do not prevent such transfer and (iii) notwithstanding the foregoing, (x) the Loan Parties need not cause the ACH or wire transfer from a DDA to a Blocked Account or the Concentration Account such reasonable amount (based upon prior business practices of the Borrowers but in no event to exceed $150,000.00 in the aggregate or such higher amount as the Administrative Agent in its Permitted Discretion determines) as is necessary or appropriate to cover dishonored checks, credit card chargebacks, bank fees and similar charges, in each case in the ordinary course of business; and (y) so long as the Obligations have not been accelerated, the Loan Parties shall not be required to transfer or cause the transfer of any funds on deposit in any Canadian Blocked Account to any United States Blocked Account or the Concentration Account; and
 
(iv)   in the event that, notwithstanding the provisions of this Section 2.23, the Loan Parties receive or otherwise have dominion and control of any such proceeds or collections, such proceeds and collections shall be held in trust by the Loan Parties for the Administrative Agent and shall not be commingled with any of the Loan Parties’ other funds or deposited in any account of any Loan Party other than as instructed by the Administrative Agent.
 
2.24   ­Application of Payments .   (a)   Upon either (i) the occurrence of a Cash Dominion Event or (ii) the occurrence of an Event of Default and acceleration of the time for payment of the Obligations, all amounts received in the Concentration Account from any source, including the Blocked Account Banks, and other amounts received by the Administrative Agent, including, without limitation, all payments by the Borrowers and any proceeds realized from any Loan Party or on account of any Collateral shall be applied, on the day of receipt, in the following order: first , to pay fees and expense reimbursements and indemnification then due and payable to the Administrative Agent, the Issuing Banks, the Acceptance Lenders and the Collateral Agent (other than those relating solely to Bank Products and Cash Management Services); second , to pay interest then due and payable on Credit Extensions; third , to repay outstanding Swingline Loans; fourth , to repay other outstanding Revolving Loans that are Prime Rate Loans and all outstanding reimbursement obligations under Letters of Credit and Acceptances; fifth , to repay outstanding Revolving Loans that are LIBO Loans and all Breakage Costs due in respect of such repayment pursuant to Section 2.21(b) or, at the Lead Borrower’s option, to fund a cash collateral deposit to the Cash Collateral Account sufficient to pay, and with direction to pay, all such outstanding LIBO Loans on the last day of the then-pending Interest Period therefor; sixth , if an Event of Default then exists and is continuing, to fund a cash collateral deposit in the Cash Collateral Account in an amount equal to 105% of all Letter of Credit Outstandings; seventh , to pay all Obligations then due arising out of any Cash Management Services provided by any Lender or its Affiliate, and, in the event that the Obligations have been accelerated, to provide collateral security to the extent required by Section 9.6 hereof, and eighth , to pay all other Obligations that are then outstanding and then due and payable, including without limitation, all Obligations arising out of any Bank Products provided by any Lender or its Affiliate and, in the event that the Obligations have been accelerated, to provide collateral security to the extent required by Section 9.6 hereof.  If all amounts set forth in clauses first through and including eighth above are paid, any excess amounts shall be deposited in a separate cash collateral account, and shall promptly be released to the Borrowers upon the request of the Lead Borrower.
 
(b)   All credits against the Obligations shall be effective on the day of receipt thereof, and shall be conditioned upon final payment to the Administrative Agent of the items giving rise to such credits. If any item credited to the Loan Account is dishonored or returned unpaid for any reason, whether or not such return is rightful or timely, the Administrative Agent shall have the right to reverse such credit and charge the amount of such item to the Loan Account and the Borrowers shall indemnify the Administrative Agent, the Collateral Agent, the Issuing Banks, the Acceptance Lenders and the Lenders against all claims and losses resulting from such dishonor or return.
 
2.25   ­Increased Costs .
 
(a)   If any Change in Law shall:
 
(i)   impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender or any holding company of any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or any Issuing Bank or Acceptance Lender; or
 
(ii)   impose on any Lender or any Issuing Bank or Acceptance Lender or the London interbank market any other condition affecting this Agreement or LIBO Loans made by such Lender or any Letter of Credit or Acceptance or participation therein;
 
and the result of any of the foregoing shall be to increase the cost to such Lender of making or main­taining any LIBO Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender, Issuing Bank or Acceptance Lender of partici­pating in, issuing or maintaining any Letter of Credit or Acceptance or to reduce the amount of any sum received or receiv­able by such Lender or Issuing Bank or Acceptance Lender hereunder (whether of principal, interest or otherwise) other than Taxes, which shall be governed by Section 2.28 hereof, then the Borrowers will pay to such Lender, Issuing Bank or Acceptance Lender, as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Bank or Acceptance Lender, as the case may be, for such additional costs incurred or reduction suffered.
 
(b)   If any Lender, any Issuing Bank or any Acceptance Lender determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s, Issuing Bank’s or Acceptance Lender’s capital or on the capital of such Lender’s, Issuing Bank’s or Acceptance Lender’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit or Acceptances held by, such Lender, or the Letters of Credit issued by such Issuing Bank, or the Acceptances issued by such Acceptance Lender, to a level below that which such Lender, Issuing Bank or Acceptance Lender or such Lender’s, Issuing Bank’s or Acceptance Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s, Issuing Bank’s or Acceptance Lender’s policies and the policies of such Lender’s, Issuing Bank’s or Acceptance Lender’s holding company with respect to capital adequacy), then from time to time the Borrowers will pay to such Lender, Issuing Bank or Acceptance Lender, as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Bank or Acceptance Lender or such Lender’s, Issuing Bank’s or Acceptance Lender’s holding company for any such reduction suffered.
 
(c)   A certificate of a Lender, an Issuing Bank or an Acceptance Lender setting forth the amount or amounts necessary to compensate such Lender, Issuing Bank or Acceptance Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section and setting forth in reasonable detail the manner in which such amount or amounts were determined shall be delivered to the Lead Borrower and shall be conclusive absent manifest error. The Borrowers shall pay such Lender, Issuing Bank or the Acceptance Lender, as the case may be, the amount shown as due on any such certificate within ten (10) Business Days after receipt thereof.
 
(d)   Failure or delay on the part of any Lender, any Issuing Bank or any Acceptance Lender to demand compensation pursuant to this Section within ninety (90) days of the effective date of the relevant Change in Law shall constitute a waiver of such Lender’s, Issuing Bank’s or Acceptance Lender’s right to demand such compensation.
 
2.26   ­Change in Legality .
 
(a)   Notwithstanding anything to the contrary contained elsewhere in this Agreement, if (x) any Change in Law shall make it unlawful for a Lender to make or maintain a LIBO Loan or to give effect to its obligations as contemplated hereby with respect to a LIBO Loan or (y) at any time any Lender determines that the making or continuance of any of its LIBO Loans has become impracticable as a result of a contingency occurring after the date hereof which adversely affects the London interbank market or the position of such Lender in the London interbank market, then, by written notice to the Lead Borrower, such Lender may (i) declare that LIBO Loans will not thereafter be made by such Lender hereunder, whereupon any request by the Borrowers for a LIBO Borrowing shall, as to such Lender only, be deemed a request for a Prime Rate Loan unless such declaration shall be subsequently withdrawn; and (ii) require that all outstanding LIBO Loans made by it be converted to Prime Rate Loans, in which event all such LIBO Loans shall be automatically converted to Prime Rate Loans as of the effective date of such notice as provided in paragraph (b) below. In the event any Lender shall exercise its rights under clause (i) or (ii) of this paragraph (a), all payments and prepayments of principal which would otherwise have been applied to repay the LIBO Loans that would have been made by such Lender or the converted LIBO Loans of such Lender shall instead be applied to repay the Prime Rate Loans made by such Lender in lieu of, or resulting from the conversion of, such LIBO Loans.
 
(b)   For purposes of this Section 2.26, a notice to the Lead Borrower by any Lender pursuant to paragraph (a) above shall be effective, and if any LIBO Loans shall then be outstanding, on the last day of the then-current Interest Period; and otherwise such notice shall be effective on the date of receipt by the Lead Borrower.
 
2.27   ­ Payments .   (a)   The Borrowers shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal, interest, fees or reimbursement of drawings under Letters of Credit or Acceptances, or of amounts payable under Sections 2.21(b), 2.25 or 2.28, or otherwise) prior to 2:00 p.m., Boston time, on the date when due, in immediately available funds, without setoff or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its offices at 100 Federal Street, Boston, Massachusetts, except payments to be made directly to the applicable Issuing Bank or Acceptance Lender or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.21(b), 2.25, 2.28 or 9.3 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein. The Administra­tive Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment under any Loan Document (other than payments with respect to LIBO Borrowings) shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, if any payment due with respect to LIBO Borrowings shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, unless that succeeding Business Day is in the next calendar month, in which event, the date of such payment shall be on the last Business Day of subject calendar month, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments under each Loan Document shall be made in Dollars (except that drawings under Letters of Credit shall be reimbursed in the same currency as such Letter of Credit was denominated).
 
(b)   If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all Obligations then due hereunder, such funds shall be applied ratably among the parties entitled thereto in accordance with the provisions of Section 2.24(a) hereof.
 
(c)   Unless the Administrative Agent shall have received notice from the Lead Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the applicable Issuing Bank or Acceptance Lender hereunder that the Borrowers will not make such payment, the Administrative Agent may assume that the Borrowers have made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the applicable Issuing Bank or Acceptance Lender, as the case may be, the amount due. In such event, if the Borrowers have not in fact made such payment, then each of the Lenders, the Issuing Banks or Acceptance Lenders, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank or Acceptance Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate.
 
(d)   If any Lender shall fail to make any payment required to be made by it pursuant to this Agreement, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under this Agreement until all such unsatisfied obligations are fully paid.
 
2.28   ­ Taxes .
 
(a)   Any and all payments by or on account of any obligation of the Borrowers hereunder or under any other Loan Document shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes, provided that if the Borrowers shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Agents, any Lender, any Issuing Bank or any Acceptance Lender (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrowers shall make such deductions, and (iii) the Borrowers shall pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law.
 
(b)   In addition, the Borrowers shall pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.
 
(c)   The Borrowers shall indemnify the Agents, each Lender, each Issuing Bank and each Acceptance Lender, within ten (10) Business Days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by such Agent, such Lender, Issuing Bank, or Acceptance Lender, as the case may be, on or with respect to any payment by or on account of any obligation of the Borrowers hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrowers by a Lender, an Issuing Bank, an Acceptance Lender, or by any Agent on its own behalf or on behalf of a Lender, an Issuing Bank or an Acceptance Lender setting forth in reasonable detail the manner in which such amount was determined, shall be conclusive absent manifest error.
 
(d)   As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrowers to a Governmental Authority, the Borrowers shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
 
(e)   Any Foreign Lender that is entitled to an exemption from or reduction in withholding tax shall deliver to the Lead Borrower and the Admini­stra­tive Agent two copies of either United States Internal Revenue Service Form W-8BEN or Form W-8ECI, or any subsequent versions thereof or successors thereto, or, in the case of a Foreign Lender’s claiming exemption from or reduction in U.S. Federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a Form W-8BEN, or any subsequent versions thereof or successors thereto (and, if such Foreign Lender delivers a Form W-8BEN, a certificate representing that such Foreign Lender is not a bank for purposes of Section 881(c) of the Code, is not a “10 percent shareholder” of the Borrowers within the meaning of section 881(c)(3)(B) of the Code, and is not a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code, properly completed and duly executed by such Foreign Lender claiming complete exemption from or reduced rate of, United States federal withholding tax on payments by the Borrowers under this Agreement and the other Loan Documents, or in the case of a Foreign Lender claiming exemption for “portfolio interest” certifying that it is not a foreign corporation, partnership, estate or trust. Such forms shall be delivered by each Foreign Lender on or before the date it becomes a party to this Agreement (or, in the case of a transferee that is a participation holder, on or before the date such participation holder becomes a transferee hereunder) and on or before the date, if any, such Foreign Lender changes its applicable lending office by designating a different lending office (a “New Lending Office”). In addition, each Foreign Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Foreign Lender. Notwithstanding any other provision of this Section 2.28(e), a Foreign Lender shall not be required to deliver any form pursuant to this 2.28(e) that such Foreign Lender is not legally able to deliver.
 
(f)   The Borrowers shall not be required to indemnify any Foreign Lender or to pay any additional amounts to any Foreign Lender in respect of United States federal withholding tax pursuant to paragraph (a) or (c) above to the extent that the obligation to pay such additional amounts would not have arisen but for a failure by such Foreign Lender to comply with the provisions of paragraph (e) above. Should a Lender become subject to Taxes because of its failure to deliver a form required hereunder, the Borrowers shall, at such Lender’s expense, take such steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.
 
2.29   ­Security Interests in Collateral .  To secure their Obligations under this Agreement and the other Loan Documents, the Borrowers have granted, and have caused each Facility Guarantor to grant to the Collateral Agent, for its benefit and the ratable benefit of the other Secured Parties, a first-priority security interest in all of the Collateral pursuant hereto and to the Security Documents.
 
2.30   ­Mitigation Obligations; Replacement of Lenders .
 
         (a)   If any Lender requests compensation under Section 2.25, or if the Borrowers are required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.28, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Sections 2.25 or 2.28, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assign­ment; provided , however , that the Borrowers shall not be liable for such costs and expenses of a Lender requesting compensation if (i) such Lender becomes a party to this Agreement on a date after the Closing Date and (ii) the relevant Change in Law occurs on a date prior to the date such Lender becomes a party hereto.
 
(b)   If any Lender requests compensation under Section 2.25, or if the Borrowers are required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.28, or if any Lender is a Defaulting Lender, then the Borrowers may, at their sole expense and effort, upon notice to such Lender and the Administrative Agent, and at the option of the Borrowers, either (x) permanently reduce the Total Commitments pursuant to Section 2.17 hereof in an amount equal to such Lender’s Commitment (and notwithstanding anything to the contrary set forth in this Agreement regarding the pro rata reduction of Commitments hereunder), provided that such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in unreimbursed drawings under Letters of Credit, Acceptances and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder (notwithstanding anything in this Agreement to the contrary regarding the pro rata sharing of payments), from the Borrowers, or (y) require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.5), all its interests, rights and obligations under this Agreement to an Eligible Assignee that shall assume such obligations (which Eligible Assignee may be another Lender, if a Lender accepts such assignment), provided that (i) except in the case of an assignment to another Lender, the Borrowers shall have received the prior written consent of the Administrative Agent, the Lead Issuing Bank, each other Lender which is then an Issuing Bank, and the Swingline Lender, which consent shall not unrea­sonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in unreimbursed drawings under Letters of Credit, Acceptances and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrowers (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.25 or payments required to be made pursuant to Section 2.28, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrowers to require such assign­ment and delegation cease to apply.
 
3.     REPRESENTATIONS AND WARRANTIES .   Each Loan Party, jointly and severally, represents and warrants to the Agents and the Lenders that:
 
3.1   Organization; Powers . Each Loan Party is, duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and each such Person has all requisite power and authority to carry on its business as now conducted, and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required. Schedule 3.1 sets forth, as of the Closing Date, each Loan Party’s legal name as it appears in the official filings in its state of organization, its state of organization, organization type, organization number, if any issued by its state of organization, and except with respect to Brown Canada, its federal employer identification number.
 
3.2   Authorization; Enforceability .    The transactions contemplated hereby and by the other Loan Documents to be entered into by each Loan Party are within such Loan Party’s corporate or limited liability company powers and have been duly authorized by all necessary corporate, membership and other action. This Agreement and the other Loan Documents have been duly executed and delivered by each Loan Party which is a party thereto and constitutes a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
 
3.3   Governmental Approvals; No Conflicts . The transactions to be entered into contemplated by the Loan Documents (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) for such as have been obtained or made and are in full force and effect, (ii) for those which could not be reasonably be expected to have a Material Adverse Effect, and (iii) for  filings and recordings necessary to perfect Liens created under the Loan Documents, (b) will not violate any Applicable Law or regulation or the Charter Documents of any Loan Party or any order of any Governmental Authority, except for such violation which could not reasonably be expected to have a Material Adverse Effect, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon any Loan Party or their respective assets, except for such violation or default which could not reasonably be expected to have a Material Adverse Effect, or give rise to a right thereunder to require any payment to be made by any Loan Party in excess of $5,000,000, and (d) will not result in the creation or imposition of any Lien on any asset of any Loan Party, except Liens created under the Loan Documents or otherwise permitted hereby or thereby.
 
3.4   Financial Condition .  The Lead Borrower has heretofore furnished to the Lenders (a) its Form 10-K containing the Consolidated balance sheet, and statements of earnings, shareholders’ equity, and cash flows for the Lead Borrower and its Subsidiaries as of and for the Fiscal Year ending February 2, 2008, and (b) its Form 10-Q containing the Consolidated balance sheet, and statements of earnings, and cash flows for the Lead Borrower and its Subsidiaries as of and for the Fiscal Quarter ending November 1, 2008. Such financial statements present fairly, in all material respects, the financial position, results of operations and cash flows of the Lead Borrower and its Subsidiaries, in each case, as of such dates and for such periods on a Consolidated basis in accordance with GAAP, subject, in the case of the Fiscal Quarter financial statements, to year end audit adjustments and the absence of footnotes.  Since February 2, 2008, there have been no changes in the assets, liabilities, financial condition or business of the Lead Borrower and its Subsidiaries which has had a Material Adverse Effect.
 
3.5   Properties .
 
(a)   Each Loan Party has good title to, or valid leasehold interests in, all of such Person’s real and personal, moveable and immoveable, property material to its business, except for defects which could not reasonably be expected to have a Material Adverse Effect.
 
(b)   Schedule  3.5(b) sets forth, as of the Closing Date, a complete and correct list of the address of all Real Estate that is owned by each Loan Party, all leases and subleases of Real Estate by each Loan Party as lessee or sublessee, and all leases and subleases of Real Estate by each Loan Party as lessor or sublessor.  Each of the leases and subleases is valid and enforceable in accordance with its terms, and is in full force and effect and no default by any party to any such lease or sublease exists, except as could not reasonably be expected to result in a Material Adverse Effect.  Each Loan Party has good and marketable title in fee simple to the Real Estate owned by such Loan Party, or valid leasehold interests in all Real Estate leased by such Loan Party, and each Loan Party has good and merchantable title or valid leasehold interests to all of its other property reflected on the most recent financial statements delivered to the Administrative Agent and the Lenders, except as disposed of in the ordinary course of business since the date thereof, free of all Liens except those permitted pursuant to Section 6.2 hereof.
 
3.6   Litigation and Environmental Matters .   
 
(a)   There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of any Loan Party, threatened against or affecting any such Person (i)  as to which there is a reasonable possi­bility of an adverse determination and that, if adversely deter­mined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than those set forth on Schedule 3.6 ) or (ii) that involve any of the Loan Documents.
 
(b)   Except for the matters set forth on Schedule 3.6 , and except as could not reasonably be expected to have a Material Adverse Effect, no Loan Party (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has, to the knowledge of any Loan Party become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.
 
(c)   Since the date of this Agreement, there has been no change in the status of the matters set forth on Schedule 3.6 that, individually or in the aggregate, has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.
 
3.7   Compliance with Laws and Agreements . Each Loan Party is in compliance with all laws, regulations and orders of any Governmental Authority applicable such Person or its property and all indentures, material agreements evidencing any Material Indebtedness, and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing.
 
3.8   Investment and Holding Company Status . No Loan Party is an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
 
3.9   Taxes . Each Loan Party has timely filed or caused to be filed all tax returns and reports required to have been filed and has paid or caused to be paid all taxes required to have been paid by it, except (a) taxes that are being contested in good faith by appropriate proceedings, for which such Person has set aside on its books adequate reserves, and as to which no Lien in excess of $5,000,000 has arisen, or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.
 
3.10   ERISA; Foreign Plans .
 
(a)   Except as set forth on Schedule 3.10, no Loan Party is party to a Plan.  No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements of the Lead Borrower and its Subsidiaries on a Consolidated basis reflecting such amounts, exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements of the Lead Borrower and its Subsidiaries on a Consolidated basis reflecting such amounts, exceed the fair market value of the assets of all such underfunded Plans.
 
(b)   No Termination Event has occurred or is reasonably expected to occur.  Each Foreign Plan is in compliance in all material respects with the laws and regulations applicable to such Foreign Plan and each Loan Party has satisfied all contribution obligations in all material respects with respect to such Foreign Plan (to the extent applicable).  Each Foreign Plan and related funding arrangement that is intended to qualify for tax-favored status has been reviewed and approved for such status by the appropriate Governmental Authority (or has been submitted for such review and approval within the applicable time period), and nothing has occurred and no condition exists that is likely to cause the loss or denial of such tax-favored status.  No Foreign Plan has any liabilities in any material respect in excess of the current value of such Foreign Plan’s assets, determined in accordance with the assumptions used for funding such Foreign Plan pursuant to reasonable accounting standards in accordance with applicable law.  No Loan Party has incurred or reasonably expects to incur any material liability as a result of the termination or other insolvency of any Foreign Plan or any material liability which is not otherwise funded or satisfied with readily available assets set aside with respect to such Foreign Plan.
 
3.11   Common Enterprise .  The successful operation and condition of each of the Loan Parties is dependent upon the continued successful performance of the functions of the group of Loan Parties as a whole and the successful operation of each Loan Party is dependent upon the successful performance and operation of each other Loan Party.  Each of the Loan Parties expects to derive benefit (and its board of directors or other governing body has determined that it may reasonably be expected to derive benefit) directly and indirectly from successful operations of the Lead Borrower and each of the other Loan Parties.  Each Loan Party expects to derive benefit (and its board of directors or other governing body has determined that it may reasonably be expected to derive benefit) directly and indirectly from the credit extended by the Lenders, the Issuing Banks and the Acceptance Lenders to the Loan Parties hereunder, both in their separate capacities and as members of the group of companies.  Each Loan Party has determined that the execution, delivery and performance of this Agreement and any other Loan Document to be executed by such Loan Party is within its purpose, will be of direct and indirect benefit to such Loan Party, and is in its best interests.
 
3.12   Disclosure .   The Loan Parties have disclosed to the Lenders all agreements, instruments and corporate or other restrictions to which any Loan Party is subject, and all other matters known to any such Person, that, individually or in the aggregate, in each case, could reasonably be expected to result in a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, provided that, with respect to projected financial information, the Loan Parties represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.
 
3.13   Subsidiaries . On and as of the Closing Date, the authorized Capital Stock or other equity, and the number of issued and outstanding shares of Capital Stock or other equity, of the Borrowers and each other Loan Party and each of their Subsidiaries is as described in Schedule 3.13.  All such outstanding shares of Capital Stock or other equity of the Borrowers and each other Loan Party have been duly and validly issued, in compliance with all legal requirements relating to the authorization and issuance of shares of Capital Stock or other equity, and are fully paid and non-assessable.  On and as of the Closing Date, there is no other Capital Stock or ownership interest of any class outstanding of the Borrowers or of any other Loan Party. Except as set forth on Schedule 3.13 or as otherwise permitted under this Agreement, none of the Loan Parties is party to any joint venture, general or limited partnership, or limited liability company agreements.
 
3.14   Insurance . Schedule 3.14 sets forth a description of all insurance maintained by or on behalf of the Loan Parties as of the Closing Date. Each of such policies is in full force and effect. As of the Closing Date, all premiums in respect of such insurance that are due and payable have been paid.
 
3.15   Labor Matters . Except as set forth on Schedule 3.15, as of the Closing Date, (a) there is no collective bargaining agreement or other labor contract covering employees of any Loan Party, (b) no such collective bargaining agreement or other labor contract is scheduled to expire during the term of this Agreement, (c) to the knowledge of the Loan Parties, no union or other labor organization is seeking to organize, or to be recognized as, a collective bargaining unit of employees of any Loan Party or for any similar purpose except as could not reasonably be expected to result in a Material Adverse Effect, and (d) there is no pending or (to the best of any Loan Party’s knowledge) threatened, strike, work stoppage, material unfair labor practice claim, or other material labor dispute against or affecting any Loan Party or its employees except as could not reasonably be expected to result in a Material Adverse Effect.
 
3.16   Certain Transactions .  Except as set forth on Schedule 3.16 , none of the officers, partners, directors, or employees of any Loan Party is presently a party to any transaction with any other Loan Party or any Affiliate, officer or director that would be prohibited by Section 6.8.
 
3.17   Restrictions on the Loan Parties .  No Loan Party is a party to or bound by any contract, agreement or instrument, or subject to any charter or other corporate restriction, that has or could reasonably be expected to have a Material Adverse Effect.
 
3.18   Security Documents . The Security Documents create in favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable security interest and hypothec in the Collateral described therein as security for the Obligations to the extent that a legal, valid, binding and enforceable security interest in such Collateral may be created under any Applicable Law of the United States of America and any states thereof, including, without limitation, the applicable Uniform Commercial Code, and under any Applicable Law of Canada and any provinces thereof, including, without limitation, the PPSA and the Civil Code, and the Security Documents constitute, or will upon the filing of financing statements and the obtaining of “control”, in each case, as applicable, with respect to the relevant Collateral as required under the applicable Uniform Commercial Code, PPSA or Civil Code, the creation of a fully perfected first priority Lien on, and security interest and hypothec in, all right, title and interest of the Borrowers and each Facility Guarantor thereunder in such Collateral, in each case prior and superior in right to any other Person (other than Permitted Encumbrances having priority under Applicable Law), except as permitted hereunder or under any other Loan Document, in each case to the extent that a security interest may be perfected by the filing of a financing statement or hypothec under the applicable Uniform Commercial Code, PPSA or Civil Code, or by obtaining “control”.
 
3.19   Federal Reserve Regulations .
 
(a)   No Loan Party is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.
 
(b)   No part of the proceeds of any Loan or any Letter of Credit or Acceptance will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to buy or carry Margin Stock or to extend credit to others for the purpose of buying or carrying Margin Stock or to refund indebtedness originally incurred for such purpose or (ii) for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or X.
 
3.20   Solvency . The Loan Parties, taken as a whole, are Solvent. No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with the transactions contemplated by this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of any Loan Party.
 
3.21   Franchises, Patents, Copyrights, Etc .   Except as otherwise set forth on Schedule 3.21 hereto, each Loan Party owns, or is licensed to use, all franchises, patents, copyrights, trademarks, tradenames, service marks, licenses and permits, and other intellectual property and rights in respect of the foregoing, necessary for the conduct of its business as substantially now conducted without known conflict or infringement with any rights of any other Person and, in each case, free of any Lien that is not a Permitted Encumbrance.
 
3.22   DDAs, Credit Card Arrangements , Etc . Schedule 3.22 sets forth, as of the Closing Date, a list of all (i) arrangements to which any Loan Party is a party with respect to the payment to any Borrower of the proceeds of all credit card charges for sales by such Loan Party in the United States of America and Canada and specifying whether a Credit Card Notification with respect thereto is in effect on the Closing Date, (ii) Blocked Account Agreements entered into by a Loan Party (or similar agreements entered into pursuant to the Existing Credit Agreement) which are in effect on the Closing Date and (iii) Disbursement Accounts maintained by the Loan Parties as of the Closing Date.
 
3.23   Customer and Trade Relations .   There exists no actual or, to the knowledge of any Loan Party, threatened in writing, termination or cancellation of, or any adverse modification or change in the business relationship of any Loan Party with any supplier material to the operations of the Loan Parties taken as a whole, which termination, cancellation or adverse modification or change could reasonably be expected to have a Material Adverse Effect.
 
3.24   Casualty .
 
As of the Closing Date, neither the businesses nor the properties of any Loan Party or any of its Subsidiaries are affected by any fire, explosion, accident, strike, lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty (whether or not covered by insurance) that, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

4.     CONDITIONS .
 
4.1   Closing Date .
 
 The effectiveness of this Agreement and the obligation of the Lenders and of the Issuing Banks and of the Acceptance Lenders hereunder is subject to the following conditions precedent:
 
(a)   The Agents (or their counsel) shall have received from each party hereto either (i) a counterpart of this Agreement and all other Loan Documents not delivered under the Existing Credit Agreement signed on behalf of such party or (ii) written evidence satisfactory to the Agents (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement and all other Loan Documents.
 
(b)   The Agents shall have received a favorable written opinion (addressed to each Agent and the Lenders on the Closing Date and dated the Closing Date) of each of (i) Bryan Cave LLP, special United States counsel to the Loan Parties, (ii) Lang Michener LLP, special Ontario counsel to Brown Canada, and (iii) WolfBlock LLP, special Pennsylvania counsel to Brown Retail, covering such matters relating to the Loan Parties, the Loan Documents or the transactions contemplated thereby as the Required Lenders shall reasonably request. The Borrowers hereby request such counsel to deliver such opinion.
 
(c)   The Agents shall have received such documents and certificates as the Agents or their counsel may reasonably request relating to the organization, existence and good standing of each Loan Party (it being understood and agreed that each Loan Party will be required to deliver a good standing certificate from its jurisdiction of organization or formation, as well as a good standing certificate for each foreign jurisdiction where such Loan Party is qualified to do business other than those jurisdictions where a Loan Party is terminating its qualification as set forth on Schedule 4.1(c) ), the authorization of the transactions contemplated by the Loan Documents and any other legal matters relating to the Loan Parties, the Loan Documents or the transactions contemplated thereby, all in form and substance reasonably satisfactory to the Agents and their counsel.
 
(d)   The Agents shall have received a Borrowing Base Certificate dated the Closing Date, relating to the month ended on January 3, 2009, and executed by a Financial Officer of the Lead Borrower, which Borrowing Base Certificate shall show that, as of the Closing Date after giving effect to (i) any Loans made or outstanding on the Closing Date and (ii) any Letters of Credit to be issued on the Closing Date and Existing Letters of Credit, Excess Availability shall be not less than $120,000,000.
 
(e)   The Agents shall have received a certificate, reasonably satisfactory in form and substance to the Agents, (i) with respect to the solvency of the Loan Parties on a Consolidated basis, as of the Closing Date, and (ii) certifying that, as of the Closing Date, the representations and warranties made by the Borrowers in the Loan Documents are true and complete (other than representations and warranties that relate solely to an earlier date) and that no event has occurred (or failed to occur) which is or which, solely with the giving of notice or passage of time (or both) would be a Default or an Event of Default.
 
(f)   The Agents shall have received (i) an updated appraisal (based on net liquidation value) by a third party appraiser acceptable to the Collateral Agent of all Inventory of the Loan Parties, the results of which are satisfactory to the Collateral Agent and (ii) a written report regarding the results of a commercial finance examination of the Loan Parties, which shall be satisfactory to the Collateral Agent.
 
(g)   All necessary consents and approvals to the transactions contemplated hereby shall have been obtained and shall be reasonably satisfactory to the Agents.
 
(h)   The Administrative Agent shall have received and be satisfied with (i) a detailed forecast for the period commencing on the Closing Date and ending with the end of the then next Fiscal Year, which shall include an Availability model, Consolidated income statement, balance sheet, and statement of cash flow, by quarter, each prepared in conformity with GAAP and consistent with the Loan Parties’ then current practices and (ii) such other information (financial or otherwise) reasonably requested by the Administrative Agent.
 
(i)   The Agents shall be reasonably satisfied that any financial statements delivered to them fairly present the business and financial condition of the Loan Parties, and that there has been no material adverse change in the assets, business, operation, financial or other condition, or income of the Loan Parties, taken as a whole, since the date of the most recent financial information delivered to the Agents.
 
(j)   Except as set forth on Schedule 3.6 , there shall not be pending any litigation or other proceeding, which, if adversely determined, (and a reasonable possibility of such adverse determination reasonably exists), could reasonably be expected to have a Material Adverse Effect on the Loan Parties, taken as a whole.
 
(k)   There shall not have occurred any default, nor shall any event exist which is, or solely with the passage of time, the giving of notice or both, would be a default under any Material Indebtedness of any Loan Party.
 
(l)   The Collateral Agent shall have received all documents and instruments, including Uniform Commercial Code financing statements, required by law or reasonably requested by the Collateral Agent to be filed, registered or recorded to create or perfect the first priority Liens intended to be created under the Loan Documents and all such documents and instruments shall have been so filed, registered or recorded to the satisfaction of the Collateral Agent and with respect to any Loan Party located in or organized under the laws of Canada, all filings and recordations required by Requirements of Law of Canada (including, without limitation, under the PPSA and the Civil Code) in all jurisdictions that the Collateral Agent may deem necessary or desirable in order to perfect the Collateral Agent's Lien in any Collateral located in Canada.
 
(m)   To the extent not delivered under the Existing Credit Agreement, the Collateral Agent shall have received Blocked Account Agreements with the Blocked Account Banks on or before the Closing Date.
 
(n)   All fees due at or immediately after the Closing Date and all reasonable costs and expenses incurred by the Agents in connection with the establishment of the credit facility contemplated hereby (including the reasonable fees and expenses of counsel to the Agents) shall have been paid in full, except that the fees and expenses of such counsel shall be paid on the earlier of the Closing Date or within three (3) Business Day after receipt of invoice therefor.
 
(o)   The consummation of the transactions contemplated hereby shall not (a) violate any Applicable Law, or (b) conflict with, or result in a default or event of default under, any material agreement of Borrowers or any other Loan Party, taken as a whole.  No event shall exist which is, or solely with the passage of time, the giving of notice or both, would be a default under any material agreement of any Loan Party.
 
(p)   No material changes in governmental regulations or policies affecting the Borrowers, the Agents or any Lender involved in this transaction shall have occurred prior to the Closing Date which could, individually or in the aggregate, materially adversely affect the transaction contemplated by this Agreement.
 
(q)   There shall be no Default or Event of Default on the Closing Date.
 
(r)   To the extent not delivered under the Existing Credit Agreement, the Collateral Agent shall have received, and be satisfied with, evidence of the Borrowers’ insurance, together with such endorsements as are required by the Loan Documents.
 
(s)   The Borrowers shall have paid all accrued and unpaid interest, fees, and expenses due under the Existing Credit Agreement to the Persons entitled thereto.
 
(t)   Assignments amongst the Lenders party to the Existing Credit Agreement and the Lenders party to this Agreement shall have been executed and delivered to the Administrative Agent to the extent deemed necessary by the Administrative Agent.
 
(u)   The Lead Arrangers shall have achieved syndication of the Loans.
 
(v)   There shall have been delivered to the Administrative Agent such additional instruments and documents as the Agents or counsel to the Agents reasonably may require or request.
 
The Administrative Agent shall notify the Lead Borrower and the Lenders of the Closing Date, and such notice shall be conclusive and binding. Notwithstanding the foregoing, this Agreement shall not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.2) at or prior to 5:00 p.m., Boston time, on January 31, 2009, (and, in the event such conditions are not so satisfied or waived, this Agreement shall terminate at such time).
 
4.2   ­Conditions Precedent to Each Loan and Each Letter of Credit and Each Acceptance .   In addition to those conditions described in Section 4.1, the obligation of the Lenders to make each Loan and of the Issuing Banks to issue each Letter of Credit and of the Acceptance Lenders to issue each Acceptance, is subject to the following conditions precedent:
 
(a)   ­ Notice . The Administrative Agent shall have received a notice with respect to such Borrowing or issuance, as the case may be, as required by Section 2.
 
(b)   Representations and Warranties . All representations and warranties contained in this Agreement and the other Loan Documents or otherwise made in writing in connection herewith or therewith shall be true and correct in all material respects on and as of the date of each Borrowing or the issuance of each Letter of Credit or Acceptance, as applicable, hereunder with the same effect as if made on and as of such date, except that such  representations and warranties (i) that relate solely to an earlier date shall be true and correct as of such earlier date and (ii) shall be true and correct in all respects if they are qualified by a materiality standard.
 
(c)   No Default . On the date of, and after giving effect to, each Borrowing hereunder and the issuance of each Letter of Credit or Acceptance, the Borrowers shall be in compliance with all of the terms and provisions set forth herein and in the other Loan Documents to be observed or performed and no Default or Event of Default shall have occurred and be continuing.
 
(d)   Borrowing Base Certificate . The Administrative Agent shall have received the  most recently required Borrowing Base Certificate, with each such Borrowing Base Certificate including schedules as required by the Administrative Agent.
 
The request by the Borrowers for, and the acceptance by the Borrowers of, each extension of credit hereunder shall be deemed to be a representation and warranty by the Borrowers that the conditions specified in this Section 4.2 have been satisfied at that time and that after giving effect to such extension of credit the Borrowers shall continue to be in compliance with the Borrowing Base.  The conditions set forth in this Section 4.2 are for the sole benefit of the Administrative Agent and each Lender and may be waived by the Administrative Agent in whole or in part without prejudice to the Administrative Agent or any Lender, including, without limitation, without prejudice to the Required Lenders’ rights under Section 7.1 and 9.2 hereof.
 
5.     AFFIRMATIVE COVENANTS .  Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees and other Obligations payable hereunder and under the other Loan Documents shall have been paid in full and all Letters of Credit and Acceptances shall have expired or terminated or have been fully cash collateralized or replaced and all L/C Disbursements shall have been reimbursed, each Loan Party covenants and agrees with the Agents and the Lenders that:
 
5.1   Financial Statements and Other Information .   The Lead Borrower will furnish to the Agents for delivery to the Lenders, each of the following, provided that the Lead Borrower need not furnish copies of information referred to in subsections (a), (b), (g) or (m) if on or before the applicable day set forth below, such information is available either on EDGAR or on the Lead Borrower’s web site:
 
(a)   within ninety-five (95) days after the end of each Fiscal Year of the Lead Borrower and its Subsidiaries, a copy of its Form 10-K containing the Consolidated balance sheet and related statements of earnings, shareholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all audited and reported on by Ernst & Young, LLP or another independent public accountant of recognized national standing (without a “going concern” or like qualification or exception and without a qualification or exception as to the scope of such audit) to the effect that such Consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Lead Borrower and its Subsidiaries on a Consolidated basis in accordance with GAAP consistently applied, and a written statement by such accountants to the effect that such accountants have reviewed this Agreement and that in auditing such Consolidated financial statements, nothing came to their attention to cause them to believe that the Loan Parties had failed to comply with the terms, covenants, provisions or conditions of this Agreement insofar as they relate to accounting matters, except for those described in reasonable detail in such statement;
 
(b)   within fifty (50) days after the end of each of the first three Fiscal Quarters of each Fiscal Year, its Form 10-Q containing the Consolidated balance sheet and related statements of earnings, and cash flows of the Lead Borrower and its Subsidiaries, as of the end of and for such Fiscal Quarter and the elapsed portion of the Fiscal Year, with comparative results to the same Fiscal Periods of the prior Fiscal Year, all certified by a Financial Officer of the Lead Borrower as presenting in all material respects the financial condition and results of operations of the Lead Borrower and its Subsidiaries in accordance with GAAP consistently applied, subject to normal year end audit adjustments and the absence of footnotes;
 
(c)   within thirty (30) days after the end of each of fiscal month of the Lead Borrower and its Subsidiaries, if so requested by the Administrative Agent, Consolidated and consolidating balance sheet and related statements of operations, stockholders’ equity and cash flows of the Lead Borrower and its Subsidiaries, as of the end of and for such month and the elapsed portion of the Fiscal Year, with comparative results to the same Fiscal Periods of the prior Fiscal Year and to the Lead Borrower’s and its Subsidiaries’ budget for such Fiscal Year furnished pursuant to Section 5.1(e) hereof;
 
(d)   concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Lead Borrower in the form of Exhibit E (a “Compliance Certificate”) (i) certifying as to whether a Default or Event of Default has occurred and, if a Default or Event of Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations with respect to the Fixed Charge Coverage Ratio for such period (whether or not it is then required to be tested hereunder), (iii) certifying that such financial statements present in all material respects the financial condition and results of operations of the Lead Borrower and its Subsidiaries in accordance with GAAP consistently applied for such period, subject, in the case of the quarterly statements, to normal year end audit adjustments and the absence of footnotes, (iv) stating whether any change in GAAP or in the application thereof has occurred since the date of the Lead Borrower’s and its Subsidiaries’ audited financial statements referred to in Section 3.4 and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such Compliance Certificate, and (v) containing either a certification that there has been no change to the information disclosed in any of the Schedules delivered in connection with Sections 3.1 through 3.24 of this Agreement or any other Loan Document (or after the delivery of the first Compliance Certificate delivered pursuant to this subsection, as previously certified), or, if so, specifying all such changes, provided that, notwithstanding the foregoing, no such revisions or updates shall be deemed to have amended, modified, or superseded any such schedules as originally attached hereto (or after the delivery of the first Compliance Certificate delivered pursuant to this subsection, as previously certified), or to have cured any breach of warranty or representation resulting from the inaccuracy or incompleteness of any such schedules, unless and until the Administrative Agent shall have accepted in writing such revisions or updates to any such schedules; and provided further that the Administrative Agent shall be deemed to have accepted such revisions or updates unless the Administrative Agent delivers a written objection thereto to the Lead Borrower within thirty (30) days after the date such revisions or updates have been received;
 
(e)   no sooner than sixty (60) days and not less than thirty (30) days prior to the commencement of each Fiscal Year of the Loan Parties, a detailed preliminary Consolidated and consolidating budget by month for such Fiscal Year (including a projected Consolidated and consolidating balance sheet and related statements of projected operations and cash flow as of the end of and for such Fiscal Year) and, within forty-five (45) days after the commencement of each such Fiscal Year, a final Consolidated and consolidating budget by month for such Fiscal Year;
 
(f)   within seventeen (17) days (or such longer period as the Administrative Agent may agree in its reasonable discretion, but in any event not to exceed twenty-five (25) days) after the end of each month, a certificate in the form of Exhibit D (a “ Borrowing Base Certificate ”) showing the Borrowing Base as of the close of business on the last day of the immediately preceding month, each such Borrowing Base Certificate to be certified as complete and correct on behalf of the Loan Parties by a Financial Officer of the Lead Borrower, provided, however , if and so long as an Event of Default has occurred and is continuing or if Excess Availability is less than the greater of (i) twenty (20%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000, Administrative Agent may require that Borrowers furnish such Borrowing Base Certificate (showing the Borrowing Base as of the close of business on the last day of the immediately preceding week) weekly on Wednesday of each week;
 
(g)   promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Lead Borrower or any other Loan Party with the Securities and Exchange Commission, or any Govern­mental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, as the case may be;
 
(h)   the financial and collateral reports described on Schedule 5.1(h) hereto, at the times set forth in such Schedule;
 
(i)   with respect to each Permitted Acquisition, to the extent permitted by Applicable Law, as soon as available, but not less than ten (10) Business Days prior to the consummation of a Permitted Acquisition, written notice to the Administrative Agent of such Permitted Acquisition together with a copy of all business and financial information reasonably requested by the Administrative Agent and, in the event that the total consideration paid or payable in connection with such Permitted Acquisition (whether in cash, property or securities) exceeds $35,000,000 or the total consideration paid or payable in connection with such Permitted Acquisition together with all other Permitted Acquisitions consummated after the Closing Date (whether in cash, property or securities) exceeds $100,000,000, a certificate of a Financial Officer of the Lead Borrower certifying (and showing the calculations therefor in reasonable detail) that the Payment Conditions will be satisfied, and (ii) as soon as available the information provided to the board of directors of the Lead Borrower with respect to such Permitted Acquisition;
 
(j)   with respect to each Permitted Acquisition, to the extent permitted by Applicable Law, as soon as available, (i) copies of the most recent audited (if available), and if later, unaudited Consolidated financial statements of the Person which is the subject of the Permitted Acquisition, (ii) a description of the proposed Permitted Acquisition in such detail as the Administrative Agent may reasonably request, including copies of letters of intent and purchase and sale agreements or other acquisition documents executed in connection with the proposed Permitted Acquisition, (iii) an unaudited pro forma Consolidated balance sheet and income statement of the Loan Parties as of the end of the most recently completed fiscal quarter but prepared as though the Permitted Acquisition had occurred on such date and related pro forma calculations of Excess Availability (as of the last day of each Fiscal Quarter) and the Fixed Charge Coverage Ratio for the subsequent four fiscal quarters period, and (iv) unaudited projections of balance sheets and income statements and related calculations for the following four fiscal quarters, assuming the Permitted Acquisition has closed;
 
(k)   notice of any intended (i) sale or other disposition of assets of any Loan Party permitted under Section 6.5(c), (d) and (e) hereof at least three (3) Business Days prior to the date of consummation such sale or disposition or (ii) incurrence of any Indebtedness permitted hereunder promptly following the incurrence of such Indebtedness;
 
(l)   within fifteen (15) days after receipt thereof, copies of all final (as distinguished from a preliminary or discussion draft) reports submitted to the Lead Borrower or any other Loan Party by independent certified public accountants in connection with each annual, interim or special audit of the books of the Loan Parties made by such accountants, including any management letter commenting on the Borrowers’ internal controls submitted by such accountants to management in connection with their annual audit;
 
(m)   promptly after their preparation, copies of any and all proxy statements, financial statements (other than those described in subsections (a) and (b) hereof), and reports which the Lead Borrower makes available to its shareholders or any holder of any Indebtedness;
 
(n)   if requested by the Administrative Agent, promptly after filing with the IRS or any other applicable Governmental Authority, a copy of each tax return filed by any Loan Party;
 
(o)   within seventeen (17) days (or such longer period as the Administrative Agent may agree in its reasonable discretion, but in any event not to exceed twenty-five (25) days) of the end of each fiscal month (unless specifically indicated otherwise), or more frequently if requested by the Administrative Agent, as of the preceding fiscal month end, in form reasonably satisfactory to the Administrative Agent: (a) a schedule of each Loan Party’s Accounts created since the last such schedule; (b) an aging of each Loan Party’s Accounts together with a reconciliation to the previous fiscal month end’s accounts receivable balance of such Loan Party’s Accounts and to its general ledger; (c) a summary aging by payee of each Loan Party’s accounts payable; and (d) upon the Agent’s request, a statement of the balance of each of the intercompany accounts of the Loan Parties; and
 
(p)   promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Lead Borrower or any other Loan Party, or compliance with the terms of any Loan Document, as the Agents or any Lender may reasonably request.
 
5.2   Notices of Material Events . The Borrowers will, and will cause each other Loan Party to furnish to the Administrative Agent, the Issuing Banks, the Acceptance Lenders, the Collateral Agent, and each Lender prompt written (except as provided in clause (e) below) notice of the following:
 
(a)   the occurrence of any Default or Event of Default, specifying the nature and extent thereof and the action (if any) which is proposed to be taken with respect thereto;
 
(b)   the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Loan Party that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;
 
(c)   the occurrence of any ERISA Event or Termination Event that, alone or together with any other ERISA Events or Termination Events, as applicable, that have occurred, could reasonably be expected to result in a Material Adverse Effect;
 
(d)   any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect;
 
(e)   telephonic notice of any change of the chief executive officer or chief financial officer of the Lead Borrower;
 
(f)   any pending or threatened (in writing) strike, work stoppage, unfair labor practice claim, or other labor dispute affecting any Loan Party which could reasonably be expected to have, or has resulted in, a Material Adverse Effect;
 
(g)   the filing of any Lien for unpaid taxes in excess of $5,000,000 against any Loan Party;
 
(h)   any casualty or other insured damage to any material portion of the Collateral or the commencement of any action or proceeding for the taking of any material portion of the Collateral or any part thereof or interest therein under power of eminent domain or by condemnation or similar proceeding;
 
(i)   the discharge by any Loan Party of its present independent accountants or any withdrawal or resignation by such independent accountants; and
 
(j)   any material adverse change in the business, operations, or financial affairs of the Loan Parties taken as a whole.
 
Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of the Lead Borrower setting forth the details of the event or development requiring such notice and, if applicable, any action taken or proposed to be taken with respect thereto.
 
5.3   Information Regarding Collateral .
 
(a)   The Lead Borrower will furnish to the Administrative Agent at least thirty (30) days’ prior written notice of any change (i) in any Loan Party’s legal name or in any trade name used to identify it in the conduct of its business or in the ownership of its properties, (ii) in the location of any Loan Party’s chief executive office, its principal place of business, any office in which it maintains books or records relating to Collateral owned by it or any office or facility at which Collateral owned by it is located (including the establishment of any such new office or facility), (iii) in any Loan Party’s identity or organizational structure or (iv) in any Loan Party’s jurisdiction of incorporation, Federal Taxpayer Identification Number or organizational identification number assigned to it by its state of organization.
 
(b)   Each year, at the time of delivery of annual financial statements with respect to the preceding Fiscal Year pursuant to Section 5.1(a), the Lead Borrower shall deliver to the Administrative Agent a certificate of a Financial Officer of the Lead Borrower setting forth the information required pursuant to Section 2 of the Perfection Certificate or confirming that there has been no change in such information since the date of the Perfection Certificate delivered on the Closing Date or the date of the most recent Perfection Certificate delivered pursuant to this Section.
 
5.4   Existence; Conduct of Business . Each Borrower will, and will cause each other Loan Party to, do or cause to be done all things necessary to comply with its respective Charter Documents, and to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, provided that the foregoing shall not prohibit any merger, amalgamation, consolidation, liquidation, or dissolution permitted under Section 6.3 or any sale, lease, transfer or other disposition permitted under Section 6.5.
 
5.5   Payment of Obligations .
 
(a)   Each Borrower will, and will cause each other Loan Party to, pay its Indebtedness and other obliga­tions (other than Indebtedness described in the parenthetical in clause (a) of the definition thereof which is not Material Indebtedness unless the failure to so pay such Indebtedness could reasonably be expected to result in a Material Adverse Effect), including tax liabilities, before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropri­ate proceedings, (b) such Borrower or such other Loan Party has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (c) such contest effectively suspends collection of the contested obligation, (d) no Lien secures such obligation (other than tax Liens in an amount not to exceed $5,000,000), and (e) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect. Nothing contained herein shall be deemed to limit the rights of the Administrative Agent under Section 2.3.
 
(b)   Without limiting the foregoing, the Lead Borrower shall either defease, repurchase or redeem the Senior Notes as permitted by Section 6.7(b)(ii) hereof or refinance the Senior Notes with Refinancing Notes, in each case at least 120 days prior to the scheduled maturity date of the Senior Notes, provided , however , that (i) the failure of the Borrower to have defeased, repurchased or redeemed the Senior Notes or to have refinanced the Senior Notes at least 120 days prior to the scheduled maturity date of the Senior Notes as provided above shall not constitute a Default or Event of Default and (ii) if the Senior Notes have not been so defeased, repurchased, redeemed or refinanced as provided above, the Administrative Agent shall impose an Availability Reserve in an amount equal to the outstanding principal amount of the Senior Notes until such Senior Notes are repurchased, redeemed or refinanced.
 
5.6   Maintenance of Properties . Each Borrower will, and will cause each other Loan Party to, keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.
 
5.7   Insurance .
 
(a)   Each Borrower will, and will cause each other Loan Party to,  (i) maintain insurance with financially sound and reputable insurers reasonably acceptable to the Administrative Agent (or, to the extent consistent with prudent business practice, a program of self-insurance approved by the Administrative Agent, such approval not to be unreasonably withheld) on such of its property and in at least such amounts and against at least such risks as is customary with companies in the same or similar businesses operating in the same or similar locations, including public liability insurance against claims for personal injury or death occurring upon, in or about or in connection with the use of any properties owned, occupied or controlled by it (including the insurance required pursuant to the Security Documents); (ii) maintain such other insurance as may be required by law; and (iii) furnish to the Administrative Agent, upon written request, full information as to the insurance carried.  The Administrative Agent shall not, by the fact of approving, disapproving, accepting, obtaining or failing to obtain any such insurance, incur liability for the form or legal sufficiency of insurance contracts, solvency of insurance companies or payment of lawsuits, and each Loan Party hereby expressly assumes full responsibility therefor and liability, if any, thereunder.  The Borrowers shall, and shall cause each other Loan Party to, furnish to the Administrative Agent certificates or other evidence satisfactory to the Administrative Agent of compliance with the foregoing insurance provisions.  The Lead Borrower shall promptly notify the Administrative Agent with respect to any claim relating in whole or in part to the Collateral in excess of $3,000,000.  So long as no Cash Dominion Event has occurred and is continuing, the Loan Parties shall have the right to negotiate and/or settle insurance claims without the consent or approval of the Administrative Agent.  After the occurrence of a Cash Dominion Event and during the continuance thereof, the Loan Parties will not settle any insurance claim with a value in excess of $3,000,000 without the consent of the Administrative Agent, which consent will not be unreasonably withheld or delayed.
 
(b)   For each of the insurance policies covering Collateral, each Loan Party shall cause the Collateral Agent to be named as a loss payee or additional insured, as applicable, in a manner acceptable to the Administrative Agent.  Each all risk property insurance policy covering Collateral shall contain (i) a clause or endorsement requiring the insurer to give not less than thirty (30) days prior written notice to the Collateral Agent in the event of cancellation or non-renewal of such policy for any reason whatsoever except non-payment of premium and a clause or endorsement requiring the insurer to give not less than ten (10) days prior written notice to the Collateral Agent in the event of cancellation of such policy for non-payment of premium (giving the Collateral Agent the right to cure defaults in the payment of premiums), (ii) to the extent available from the applicable insurer, a clause or endorsement stating that the interest of the Collateral Agent shall not be impaired or invalidated by any act or neglect of the insured Person or the owner of any premises, including, without limitation, as a result of the use of any such premises for purposes more hazardous than are permitted by such policy, and (iii) to the extent available from the applicable insurer, a clause or endorsement stating that none of the Loan Parties, the Administrative Agent, the Collateral Agent, or any other party shall be a coinsurer.  Each commercial general liability policy shall contain (1) a clause or endorsement requiring the insurer to give not less than thirty (30) days prior written notice to the Collateral Agent in the event of cancellation or non-renewal of such policy for any reason whatsoever except non-payment of premium and a clause or endorsement requiring the insurer to give not less than ten (10) days prior written notice to the Collateral Agent in the event of cancellation of such policy for non-payment of premium (giving the Collateral Agent the right to cure defaults in the payment of premiums), and (2) a clause or endorsement stating that the Collateral Agent shall be named as additional insured parties, mortgagee or assignee, as applicable.  All premiums for such required insurance shall be paid by the Loan Parties when due, and certificates of insurance shall be sent to the appropriate Loan Parties and the Collateral Agent, and if requested by the Collateral Agent, photocopies of the policies, shall be delivered to the Collateral Agent. The Loan Parties shall deliver to the Collateral Agent, prior to the cancellation or non-renewal of any such policy of insurance, a copy of a renewal or replacement policy (or other evidence of renewal of a policy previously delivered to the Collateral Agent).  To the extent requested by the Collateral Agent, the Loan Parties shall deliver to the Collateral Agent evidence satisfactory to the Collateral Agent of payment of the applicable portion of the annual premium then due and payable.  If any Loan Party fails to procure (or cause to be procured) such insurance or to pay the premiums therefor when due, the Agents may, without waiving any Event of Default occasioned thereby, obtain such insurance and pay such premiums at the expense of the Loan Parties.  All proceeds of any insurance claim relating to Collateral shall be promptly deposited by the applicable Loan Party to a Blocked Account or the Concentration Account, and such proceeds until so deposited shall be held in trust for the Collateral Agent by the applicable Loan Party.  The Agents shall apply any proceeds received in accordance with Section 2.24 hereof or Section 6.2 of the Security Agreement, as applicable.
 
(c)   None of the Agents or other Secured Parties, or their agents or employees shall be liable for any loss or damage insured by the insurance policies required to be maintained under this Section 5.7.  Each Loan Party shall look solely to its insurance companies or any other parties other than the Credit Parties for the recovery of such loss or damage and such insurance companies shall have no rights of subrogation against any Agent or Secured Party or its agents or employees.  If, however, the insurance policies do not provide waiver of subrogation rights against such parties, as required above, then the Loan Parties hereby agree, to the extent permitted by law, to waive their right of recovery, if any, against the Agents and the other Secured Parties and their agents and employees.  The designation of any form, type or amount of insurance coverage by any Agent or Secured Party under this Section 5.7 shall in no event be deemed a representation, warranty or advice by such Agent or Secured Party that such insurance is adequate for the purposes of the business of the Loan Parties or the protection of their properties.
 
(d)   The Lead Borrower shall respond to requests from the Collateral Agent for information relating to insurance within ten (10) Business Days of the Lead Borrower’s receipt of such request.  To the extent that the Lead Borrower fails to reasonably satisfy such request within such period, the Lead Borrower will permit any representatives that are designated by the Collateral Agent to inspect the insurance policies maintained by or on behalf of the Loan Parties and to inspect books and records related thereto and any properties covered thereby. The Loan Parties shall pay the reasonable fees and expenses of any representatives retained by the Collateral Agent to conduct any such inspection.
 
5.8   Intentionally Omitted .
 
5.9   Books and Records; Inspection and Audit Rights .
 
(a)   Each Borrower will, and will cause each other Loan Party to, keep proper books of record and account in which full, true and correct entries in all material respects are made of all dealings and transactions in relation to its business and activities. Each Borrower will permit any representatives designated by any Agent, upon reasonable prior notice (unless an Event of Default has occurred and is continuing in which event no such notice shall be required), to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers, all on reasonable advance notice to the Lead Borrower (unless an Event of Default then exists) and at such reasonable times during normal business hours and as often as reasonably requested.
 
(b)   Each Borrower will, and will cause each other Loan Party to, from time to time upon the reasonable request and reasonable prior notice of the Collateral Agent or the Required Lenders through the Administrative Agent, permit any Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Agents to conduct appraisals, commercial finance examinations and other evaluations, including, without limitation, of (i) the Borrowers’ practices in the computation of the Borrowing Base and (ii) the assets included in the Borrowing Base and related financial information such as, but not limited to, sales, gross margins, payables, accruals and reserves.  Without limiting the foregoing:
 
(i)   during any period of four (4) consecutive Fiscal Quarters during which Excess Availability is at all times greater than or equal to the greater of (A) seventeen and one-half percent (17.5%) of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000, the Administrative Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Agents shall conduct one (1) appraisal of the Loan Parties’ Inventory and one (1) commercial finance examination;
 
(ii)   during any period of four (4) consecutive Fiscal Quarters during which Excess Availability is at any time less than the greater of (A) seventeen and one-half percent (17.5%) of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000, in addition to the appraisal and commercial finance examination described in clause (i) above, the Administrative Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Agents shall conduct one (1) additional appraisal of the Loan Parties’ Inventory and one (1) additional commercial finance examination; and
 
(iii)   in addition to the appraisals and commercial finance examinations described in clauses (i) and (ii) above, in the Administrative Agent’s discretion, the Administrative Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Agents may conduct one (1) additional appraisal of the Loan Parties’ Inventory and one (1) additional commercial finance examination during any period of four (4) consecutive Fiscal Quarters.
 
The Loan Parties shall pay the reasonable fees and expenses of the Administrative Agent or professionals (including consultants, accountants, lawyers and appraisers) retained by the Agents in connection with the appraisals and commercial finance examinations (i) described in clauses (i), (ii) and (iii) above, (ii) undertaken at any time at the request of the Administrative Agent if required by Applicable Law and (iii) undertaken at the request of the Administrative Agent, as it in its discretion deems necessary or appropriate, after the occurrence and the continuation of an Event of Default.  In addition to the foregoing the Administrative Agent will have the right to conduct additional commercial finance examinations and appraisals during normal business hours and upon reasonable advance notice at the expense of the Administrative Agent, as it in its discretion deems necessary or appropriate.
 
(c)   The Borrowers shall, at all times, retain independent certified public accountants who are reasonably satisfactory to the Administrative Agent.
 
5.10   Fiscal Year .  Each Loan Party shall have a fiscal year of a 52 or 53 week period ending on the Saturday nearest to January 31st and shall notify the Administrative Agent of any change in such fiscal year.
 
5.11   Physical Inventories .
 
(a)   The Collateral Agent, at the expense of the Loan Parties, may participate in and/or observe each physical count and/or inventory of so much of the Collateral as consists of Inventory which is undertaken on behalf of the Loan Parties so long as such participation does not disrupt the normal inventory schedule or process.
 
(b)   The Loan Parties, at their own expense, shall undertake physical inventories and cycle counts to be undertaken at the times, using practices, and in the manner consistent with their practices in effect on the Closing Date.
 
(c)   Upon the request of the Collateral Agent, the Loan Parties shall provide the Collateral Agent with a reconciliation of the results of each such physical inventory or cycle count.  The Loan Parties shall post the results of each such physical inventory to the Loan Parties’ stock ledger and general ledger, as applicable.
 
(d)   The Collateral Agent, in its discretion, if any Event of Default exists, may cause such additional inventories to be taken as the Collateral Agent determines (each, at the expense of the Loan Parties).  The Collateral Agent shall use its best efforts to schedule any such inventories so as to not unreasonably disrupt the operation of the Loan Parties’ business.
 
5.12   Compliance with Laws . Each Borrower will, and will cause each other Loan Party to, comply in all material respects with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
 
5.13   Use of Proceeds and Letters of Credit and Acceptances . The proceeds of Loans made hereunder and Letters of Credit and Acceptances issued hereunder will be used only (a) for Restricted Payments and Permitted Acquisitions, (b) to finance the acquisition of working capital assets of the Loan Parties, including the purchase of inventory and equipment, in each case in the ordinary course of business, (c) to finance Capital Expenditures of the Borrowers, (d) to defease, redeem or repurchase the Senior Notes in accordance with Section 6.7(b)(ii) hereof and (e) for general corporate purposes, all to the extent permitted herein. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations U and X.
 
5.14   Additional Subsidiaries .  If any additional Material Subsidiary of any Loan Party is formed or acquired after the Closing Date or if any Subsidiary becomes a Material Subsidiary, the Lead Borrower will notify the Administrative Agent thereof and the Loan Parties will cause such Material Subsidiary to become a Borrower or Facility Guarantor hereunder, as the Administrative Agent may request, and under each applicable Security Document in the manner provided therein within fifteen (15) days after such Material Subsidiary is formed or acquired or becomes a Material Subsidiary and promptly take such actions to create and perfect Liens on such Material Subsidiary’s assets that would otherwise constitute Collateral to secure the Obligations as any Agent shall reasonably request.
 
5.15   Further Assurances .  (a) Each Loan Party will execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements and other documents), that may be required under any Applicable Law, or which any Agent or the Required Lenders may reasonably request, to effectuate the transactions contemplated by the Loan Documents or to grant, preserve, protect or perfect the Liens created or intended to be created by the Security Documents or the validity or priority of any such Lien, all at the expense of the Loan Parties. The Loan Parties also agree to provide to the Agents, from time to time upon request, evidence reasonably satisfactory to the Agents as to the perfection and priority of the Liens created or intended to be created by the Security Documents.
 
(b)           If any material assets which would otherwise constitute Collateral are acquired by any Loan Party after the Closing Date (other than assets constituting Collateral under the applicable Security Agreement that become subject to the Lien of such Security Agreement upon acquisition thereof), the Lead Borrower will notify the Agents thereof, and will cause such assets to be subjected to a Lien securing the Obligations and will take such actions as shall be necessary or reasonably requested by the Collateral Agent to grant and perfect such Liens, including actions described in paragraph (a) of this Section, all at the expense of the Loan Parties.
 
(c)           Upon the request of the Administrative Agent, the Loan Parties shall cause each of their customs brokers and/or warehouses that have not already done so to deliver an agreement to the Administrative Agent covering such matters and in form substantially similar to the agreements with customs brokers and/or warehouse in effect on the Closing Date.
 
6.     NEGATIVE COVENANTS .
 
Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees and other Obligations payable hereunder and under the other Loan Documents have been paid in full and all Letters of Credit and Acceptances have expired or terminated or have been fully cash collateralized or replaced and all L/C Disbursements shall have been reimbursed, each Loan Party covenants and agrees with the Agents and the Lenders that:
 
6.1   Indebtedness and Other Obligations . The Borrowers will not, and will not permit any other Loan Party to, create, incur, assume or permit to exist any Indebtedness, except, as long as no Event of Default exists at the time of incurrence of such Indebtedness or would arise therefrom:
 
(a)   Indebtedness created under the Loan Documents;
 
(b)   Indebtedness set forth in Schedule 6.1 and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased weighted average life thereof;
 
(c)   Indebtedness of any Loan Party to any other Loan Party;
 
(d)   Indebtedness of  the Loan Parties to finance the acquisition of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased weighted average life thereof, provided that the aggregate principal amount of Indebtedness permitted by this clause (d) shall not exceed $35,000,000 at any time outstanding unless, at the time of incurrence of any Indebtedness which would result in such amount being exceeded, the Payment Conditions shall have been satisfied;
 
(e)   Indebtedness incurred to finance any Real Estate now or hereafter owned by any Borrower or incurred in connection with any sale-leaseback transaction;
 
(f)   Indebtedness under Hedging Agreements, other than for speculative purposes, entered into in the ordinary course of business;
 
(g)   Contingent liabilities under surety bonds or similar instruments incurred in the ordinary course of business in connection with the construction or improvement of stores;
 
(h)   Unsecured Indebtedness of a Loan Party to one or more Foreign Subsidiaries in an aggregate principal amount at any one time outstanding not in excess of $200,000,000;
 
(i)   Indebtedness in respect of the Senior Notes and the Refinancing Notes;
 
(j)   Subordinated Debt (other than Indebtedness described in subsection (k) below) provided that after giving effect to the incurrence thereof, the Payment Conditions are satisfied;
 
(k)   Unsecured Indebtedness for borrowed money, including, without limitation, Subordinated Debt (other than Indebtedness described in subsection (j) above), provided that (A) after giving effect to the incurrence thereof and the projected refinancing or refunding thereof, the Payment Conditions are satisfied (except that it shall not be necessary to satisfy the Payment Conditions with respect to any such refinancing, refunding or exchange for any bridge facility permitted under this Section 6.1(k)) with the proceeds of any publicly issued or privately placed notes, any exchange notes or any rollover notes, in each case issued to refinance or refund, or in exchange for any such bridge facility), (B) constitutes a bridge loan pending the consummation of a debt or equity issuance, and (C) the principal of which will not be repaid (other than (1) from the proceeds of such debt or equity issuance or from any rollover loans, publicly issued or privately placed notes, or exchange notes issued in exchange for the bridge loan, or (2) as permitted pursuant to Section 6.7(b)(i) hereof) until all Obligations have been paid in full and all Commitments terminated;
 
(l)   Indebtedness represented by letters of credit or acceptances issued in any currency other than Dollars which any Issuing Bank or Acceptance Lender, as applicable, was unable or unwilling to issue according to the terms hereof backed by Dollar denominated Letters of Credit or Acceptances;
 
(m)   Guarantees of Indebtedness otherwise allowed under this Section 6.1 and Section 6.4 hereof and other obligations of any other Loan Party which do not constitute Indebtedness,
 
(n)   Guarantees of lease obligations for retail and other business locations sold by a Loan Party in connection with any sale permitted pursuant to Section 6.5 hereof but only to the extent of any such lease obligation as of the date of sale of such location;
 
(o)   Other unsecured Guarantees of Indebtedness and other obligations of any Subsidiary which is not a Loan Party, provided that no payment shall be made on account of any such Guarantee unless the Payment Conditions are satisfied at the time of payment;
 
(p)   In addition to Indebtedness permitted under subsection (h) above, Indebtedness (i) owing by a Loan Party to any other Subsidiary of the Lead Borrower which is not a Loan Party, subject to the Dollar limitations set forth in clause (r) hereof, and (ii) Indebtedness of a Subsidiary of the Lead Borrower which is not a Loan Party to another such Subsidiary which is not a Loan Party;
 
(q)   Indebtedness assumed by a Loan Party or a Subsidiary of a Loan Party or a Person who will become a Loan Party (or Indebtedness secured by a Lien in effect prior to any such acquisition on property acquired in connection with such acquisition, which property would not be of a type included in the Borrowing Base) in connection with a Permitted Acquisition, provided that the aggregate principal amount of Indebtedness permitted by this clause (q) shall not exceed $35,000,000 at any time outstanding unless, at the time of incurrence of any Indebtedness which would result in such amount being exceeded, the Payment Conditions shall have been satisfied;
 
(r)   Indebtedness consisting of Earn-Out Obligations, but only to the extent that the contingent consideration relating thereto is paid within thirty (30) days after the amount due is finally determined; and
 
(s)   other unsecured Indebtedness in an aggregate principal amount not to exceed $100,000,000 at any time outstanding, unless at the time of incurrence of any Indebtedness which would result in such amount being exceeded, the Payment Conditions shall have been satisfied.
 
6.2   Liens . The Borrowers will not, and will not permit any other Loan Party to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including Accounts) or rights in respect of any thereof, except as long as no Event of Default exists at the time of creation or incurrence of such Lien or would arise therefrom:
 
(a)   Liens created under the Loan Documents;
 
(b)   Permitted Encumbrances;
 
(c)   any Lien on any property or asset of any Borrower or other Loan Party set forth in Schedule 6.2 , provided that (i) such Lien shall not apply to any other property or asset of such Person and (ii) such Lien shall secure only those obligations that it secures as of the Closing Date, and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;
 
(d)   Liens on fixed or capital assets acquired by any Loan Party, provided that (i) such Liens secure Indebtedness permitted by Section 6.1(d), (ii) the Indebtedness secured thereby does not exceed 100% of the cost of acquiring such fixed or capital assets and (iii) such Liens shall not apply to any other property or assets of the Borrowers or other Loan Party;
 
(e)   Liens to secure Indebtedness permitted by Section 6.1(e) provided that such Liens shall not apply to any property or assets of the Loan Parties other than the Real Estate so financed or which is the subject of a sale-leaseback transaction;
 
(f)   Liens to secure Indebtedness permitted by Section 6.1(q), provided that (i) such Lien shall not apply to any other property or asset of such Person, (ii) such Lien shall not have been incurred in contemplation of, or in connection with, such Permitted Acquisition, (iii) shall secure only those obligations that it secures as of the date of the Permitted Acquisition, and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof, and (iv) shall not apply to any Collateral;
 
(g)   Liens existing on assets prior to the acquisition thereof, which are directly or indirectly acquired in a Permitted Acquisition provided that (i) such Liens secure Indebtedness permitted under Section 6.1 hereof or obligations to a lessor under a lease of Real Estate to a Loan Party, (ii) such Liens are not created in contemplation of or in connection with such Permitted Acquisition, (iii) such Liens shall not apply to any other property or assets of a Loan Party, (iv) such Liens shall secure only the Indebtedness or other obligations that such Liens secure on the date of the Permitted Acquisition; and (v) such Liens shall not attach to assets which would be of a type included as Collateral or in the Borrowing Base, except for non-material Liens acceptable to the Administrative Agent; and
 
(h)   Liens on cash and cash equivalents to secure letters of credit permitted pursuant to Section 6.1(q).
 
6.3   Fundamental Changes .  (a)           The Borrowers shall not, and shall not permit any other Loan Party to, liquidate, merge, amalgamate, or consolidate into or with any other Person or enter into or undertake any plan or agreement of liquidation, merger, amalgamation, or consolidation with any other Person, provided that (i) a Loan Party may merge or amalgamate with another Person in connection with a Permitted Acquisition if such Loan Party is the surviving company, (ii) any wholly-owned Subsidiary of any Borrower may merge, amalgamate, or consolidate into or with such Borrower or any other wholly-owned Subsidiary of such Borrower if no Default or Event of Default has occurred and is continuing or would result from such merger and if such Borrower, a Loan Party (if such Loan Party is a party to such merger) or such Subsidiary is the surviving company, (iii) a Subsidiary of any Borrower may merge or amalgamate into another entity in connection with a Permitted Acquisition if, upon consummation of such merger or amalgamation, the surviving entity shall be a direct or indirect wholly-owned Subsidiary of such Borrower and becomes a Borrower or Facility Guarantor and a party to the Security Documents, (iv) any Domestic Subsidiary may merge into any other Domestic Subsidiary, provided that if a Loan Party is a party to such merger, either such Loan Party shall be the surviving company or the surviving company shall become a Loan Party, and (v) the Lead Borrower may merge with a newly formed shell corporation, the sole purpose and effect of which merger is to reincorporate the Lead Borrower in a state of the United States of America other than the State of New York and where the surviving corporation in such merger has  complied with its obligations under Section 5.14 hereof simultaneously with such merger.
 
(b)   The Borrowers shall not, and shall not permit any other Loan Party to, engage to any material extent in any business other than businesses of the type conducted by the Loan Parties on the date of execution of this Agreement and businesses reasonably related thereto, except that any Loan Party may withdraw from any business activity which such Loan Party reasonably deems unprofitable or unsound, provided that promptly after such withdrawal, the Lead Borrower shall provide the Administrative Agent with written notice thereof.
 
6.4   Investments, Loans, Advances, Guarantees and Acquisitions . The Borrowers shall not, and shall not permit any other Loan Party to, purchase, hold or acquire (including pursuant to any merger or amalgamation with any Person that was not a wholly owned Subsidiary prior to such merger or amalgamation) any Capital Stock, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, guarantee any Indebtedness of, or make or permit to exist any Investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit (each of the foregoing, an “Investment”), except for:
 
(a)   Permitted Acquisitions;
 
(b)   Permitted Investments;
 
(c)   Investments existing on the Closing Date, and set forth on Schedule 6.4 , to the extent such investments would not be permitted under any other clause of this Section;
 
(d)   Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business;
 
(e)   Investments in Hedging Agreements other than for speculative purposes, entered into in the ordinary course of business;
 
(f)   Permitted Stock Repurchases, as long as no Event of Default exists at the time of making of such Permitted Stock Repurchase or would arise therefrom;
 
(g)   Investments by a Loan Party in a Subsidiary (including, without limitation, in a Foreign Subsidiary) which is not a Loan Party, in a joint venture (including, without limitation, in or with a foreign Person) or in a Person (including, without limitation, in a foreign Person)which constitutes a minority equity interest in such Person provided that such Investments do not exceed $35,000,000 for any single Investment or $100,000,000 in the aggregate for all such Investments after the Closing Date, unless, in each case, the Payment Conditions are satisfied; and provided further that for purposes of calculation, the amount of any Investment shall be the aggregate cash Investment less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends and distributions) received by such Loan Party from such Subsidiary, joint venture or Person;
 
(h)   Investments by a Loan Party Borrower in another Loan Party;
 
(i)   Commissions, loans or advances to employees for the purpose of travel, entertainment or relocation in the ordinary course of business and consistent with past practices, provided that the aggregate amount thereof outstanding at any one time shall not, if not repaid, be reasonably expected to have a Material Adverse Effect; and
 
(j)   other Investments in an aggregate amount not to exceed $35,000,000 after the Closing Date.
 
6.5   Asset Sales .
 
The Borrowers will not, and will not permit any other Loan Party to, sell, transfer, lease or otherwise dispose of any asset, including any Capital Stock, nor will the Loan Parties issue any additional shares of its Capital Stock or other ownership interests in such Loan Party, or issue any shares of Disqualified Stock, except as long as no Event of Default would arise therefrom:
 
(a)   (i) sales of Inventory, or (ii) used, obsolete or surplus property, or (iii)  Permitted Investments, in each case in the ordinary course of business;
 
(b)   sales, transfers and dispositions among the Loan Parties;
 
(c)   the sale of the Headquarters;
 
(d)   the sale and leaseback of any other of the Loan Parties’ Real Estate or other fixed assets;
 
(e)   the Designated Dispositions;
 
(f)   other sales, transfers, or dispositions of assets not in the ordinary course of business (including retail store locations) provided that (x) no Default or Event of Default then exists or would arise therefrom and (y) if the fair market value of all such other sales, transfers and dispositions exceeds $35,000,000 for the Loan Parties in the aggregate during any Fiscal Year (net of the related sales costs, if any, of such other property), all of the proceeds of such sale, transfer or disposition (net of the related sales costs, if any, of such other property) in excess of $35,000,000 shall be paid to the Administrative Agent (whether or not a Cash Dominion Event has occurred and is then continuing) for application to the Obligations, provided further that , if a Cash Dominion Event then exists and is continuing, all of such proceeds (and not only those in excess of $35,000,000) shall be paid to the Administrative Agent for application to the Obligations; and
 
(g)   the issuance of additional shares of Capital Stock or other ownership interests in a Loan Party (other than Disqualified Stock) as long as no Change in Control results therefrom;
 
provided that all sales, transfers, leases and other dispositions permitted hereby (other than sales, transfers and other disposition permitted under clauses (a)(ii), (b) and (g)) shall be made at arm’s length and for fair value and solely for cash consideration; and further provided that the authority granted hereunder may be terminated in whole or in part by the Administrative Agent upon the occurrence and during the continuance of any Event of Default.
 
6.6   Restrictive Agreements . The Borrowers will not, and will not permit any other Loan Party to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of any Loan Party to create, incur or permit to exist any Lien upon any of its property or assets in favor of the Secured Parties, or (b) the ability of (i) any Loan Party (other than the Lead Borrower) to pay dividends or other distributions with respect to any shares of its Capital Stock or (ii) any Loan Party to make or repay loans or advances to any Loan Party or to guarantee Indebtedness of any Loan Party, provided that (i) the foregoing shall not apply to restrictions and conditions imposed by Applicable Law or by the Loan Documents, (ii) the foregoing shall not apply to restrictions and conditions existing on the Closing Date identified on Schedule 6.6 hereto (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided that such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv) clause (a) of this Section shall not apply to restrictions of conditions imposed by any agreement relating to secured Indebtedness permitted hereunder if such restrictions or conditions apply only to the property or assets securing such Indebtedness, and (v) clause (a) of this Section shall not apply to customary provisions in leases or licenses or other agreements, including, without limitation, those relating to franchises, patents, copyrights, trademarks, tradenames, service marks, licenses and permits, and other intellectual property restricting the assignment thereof.
 
6.7   Restricted Payments; Certain Payments of Indebtedness .  (a) The Borrowers will not, and will not permit any other Loan Party to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except as long as no Default or Event of Default exists or would arise therefrom (i) the Lead Borrower may declare and pay dividends quarterly with respect to its Capital Stock provided that the aggregate of all such dividends shall not exceed $35,000,000 for any single dividend declared to stockholders or $100,000,000 in the aggregate for all such dividends after the Closing Date, unless, in each case, the Payment Conditions are satisfied, (ii) the Lead Borrower may declare dividends payable solely in additional shares of its common stock, (iii) the Subsidiaries of the Lead Borrower may declare and pay cash dividends with respect to their Capital Stock, and (iv) the Lead Borrower may make Permitted Stock Repurchases.
 
(b)           The Borrowers will not at any time, and will not permit any other Loan Party to make or agree to pay or make, directly or indirectly, any payment or other distribution (whether in cash securities or other property) of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness (other than the Loans), except:
 
(i)   payment when due (excluding any voluntary prepayments and, unless otherwise agreed by the Required Lenders, payments due upon a Change in Control) of principal, interest, fees and expense reimbursements with respect to Indebtedness permitted under Section 6.1, but only to the extent required under the terms of the documents evidencing such Indebtedness;
 
(ii)   voluntary prepayments of Indebtedness (including, without limitation, deposits of assets to defease the Senior Notes and purchases, repurchases or redemptions of all or any portion of the Senior Notes, whether on the open market or otherwise but excluding voluntary prepayments of Subordinated Debt), as long as the Payment Conditions are satisfied;
 
(iii)   Intentionally Omitted; and
 
(iv)   refinancings of Indebtedness described in clauses (i) and (ii), above, to the extent permitted by Section 6.1, including, without limitation, any refinancing as a result of any rollover loans, publicly issued or privately placed notes or exchange notes issued in exchange for such Indebtedness, and all fees and expenses payable in connection with such refinancing.
 
6.8   Transactions with Affiliates .  Except as set forth on Schedule 3.16 and Restricted Payments and other transactions expressly permitted under the terms of this Agreement, the Loan Parties will not at any time sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, officers or directors, except (a) transactions in the ordinary course of business that are at prices and on terms and conditions not less favorable to the Loan Parties than could be obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among the Loan Parties not involving any of its Affiliates, officers or directors which would not otherwise violate the provisions of the Loan Documents, and (c) advances for commissions, travel and other similar purposes in the ordinary course of business to directors, officers and employees.
 
6.9   Additional Subsidiaries .  The Borrowers will not, and will not permit any other Loan Party to, create any additional Subsidiary unless no Default or Event of Default would arise therefrom and the requirements of Section 5.14, to the extent applicable, are satisfied.
 
6.10   Amendment of Material Documents .  The Borrowers will not, and will not permit any other Loan Party to, amend, modify or waive any of its rights under (a) its Charter Documents, or (b) any other Material Indebtedness or material agreements, in each case to the extent that such amendment, modification or waiver could reasonably likely to result in a Material Adverse Effect.
 
6.11   Environmental Laws .  The Loan Parties shall not (a) fail to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, or (b) become subject to any Environmental Liability, in each case which is reasonably likely to have a Material Adverse Effect.
 
6.12   Fiscal Year .   The Loan Parties shall not change their Fiscal Year without the prior written consent of the Administrative Agent, which consent shall not be unreasonably withheld.
 
6.13   Minimum Fixed Charge Coverage Ratio .   If Excess Availability is less than the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 at any time, the Loan Parties shall maintain a Fixed Charge Coverage Ratio, calculated on a trailing four Fiscal Quarters basis of not less than 1.0:1.0.  Such Fixed Charge Coverage Ratio shall be first tested monthly as of the month ending immediately prior to the date that Excess Availability is first less than the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 and shall continue to be tested until Excess Availability has exceeded the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 on each day for two consecutive Fiscal Quarters.
 
7.     EVENTS OF DEFAULT .
 
7.1   Events of Default .  If any of the following events (“Events of Default”) shall occur:
 
(a)   Any Loan Party shall fail to pay any principal or interest with respect to any Loan or any reimbursement obligation in respect of any L/C Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
 
(b)   Any Loan Party shall fail to pay any fees or other amounts due under this Agreement or any other Loan Document (other than an amount referred to in clause (a) of this Section), within three (3) Business Days of the date when same shall become due and payable;
 
(c)   any representation or warranty made or deemed made by or on behalf of any Loan Party in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, shall prove to have been incorrect in any material respect when made or deemed made;
 
(d)   the Loan Parties shall fail to observe or perform any covenant, condition or agreement contained in Sections 2.23, 5.1(a), 5.1(b), 5.1(d), 5.1(e), 5.1(f), 5.2, 5.4, 5.7, 5.9, 5.13, 5.14 or in Section 6;
 
(e)   any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document (other than those specified in clause (a), (b), (c), or (d) of this Section), and such failure shall continue unremedied for a period of 15 days after notice thereof from the Administrative Agent to the Lead Borrower;
 
(f)   any Borrower shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness when and as the same shall become due and payable (after giving effect to the expiration of any grace or cure period set forth therein) other than a failure to make any payment in respect of a Guarantee where such payment is prohibited by Section 6.1(o);
 
(g)   any Loan Party shall fail to perform any material covenant or condition contained in any material contract or agreement to which it is party as and when such performance is required (after giving effect to the expiration of any grace or cure period set forth therein);
 
(h)   any event or condition occurs that (i) results in any Material Indebtedness becoming due prior to its scheduled maturity or (ii) enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any such Material Indebtedness or any trustee or agent on its or their behalf to cause any such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, or to undertake any enforcement action with respect to any Material Indebtedness, unless in the case of this clause (ii) such action is being contested in good faith by appropriate proceedings, such contest effectively suspends any enforcement action, and pending such contest, a Material Adverse Effect could not reasonably be expected to result therefrom, provided that with respect to any Material Indebtedness which is with recourse only to specific assets of the Loan Parties, the foregoing shall not constitute an Event of Default unless a Material Adverse Effect could reasonably be expected to result from such action;
 
(i)   an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Loan Party or its debts or which seeks to stay or has the effect of staying any creditor, or of a substantial part of its assets, under any federal, state or provincial bankruptcy, insolvency, receivership, liquidation, winding up, corporate or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator, administrator, monitor, or similar official for any Loan Party or for a substantial part of its assets, and, in any such case, either (x) such proceeding or petition shall continue undismissed for 30 days or an order or decree approving or ordering any of the foregoing shall be entered and continue unstayed and in effect for 60 days, or (y) a Material Adverse Effect shall have occurred;
 
(j)   any Loan Party shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state  or provincial bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (i) of this Section, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator, administrator, monitor, or similar official for any Loan Party or for a substan­tial part of its assets, (iv) file an answer admit­ting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
 
(k)   any Loan Party shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;
 
(l)   one or more uninsured judgments for the payment of money in an aggregate amount in excess of $15,000,000 shall be rendered against any Loan Party or any combination thereof and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any material assets of any Loan Party to enforce any such judgment;
 
(m)   (i)           any challenge by or on behalf of any Loan Party or other Person to the validity of any Loan Document or the applicability or enforceability of any Loan Document strictly in accordance with the subject Loan Document’s terms or which seeks to void, avoid, limit, or otherwise adversely affect any security interest created by or in any Loan Document or any payment made pursuant thereto;
 
(ii)           any Lien purported to be created under any Security Document shall cease to be, or shall be asserted by any Loan Party or other Person not to be, a valid and perfected Lien on any Collateral, with the priority required by the applicable Security Document;
 

(n)   a Change in Control shall occur;
 
(o)   an ERISA Event or Termination Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events or Termination Events that have occurred, could reasonably be expected to result in liability of the Borrowers in an aggregate amount exceeding $15,000,000;
 
(p)   the occurrence of any uninsured loss (exclusive of any deductible retained by the Borrowers under its insurance policies) to any material portion of the Collateral;
 
(q)   the indictment of, or institution of any legal process or proceeding against, any Loan Party, under any federal, state, provincial, municipal, and other civil or criminal statute, rule, regulation, order, or other requirement having the force of law where the relief, penalties, or remedies sought or available include the forfeiture of any material portion of the Collateral;
 
(r)   there is filed against any Loan Party any action, suit, or proceeding under any federal, state, or provincial racketeering statute (including the Racketeer Influenced and Corrupt Organization Act of 1970), which action, suit, or proceeding (i) is not dismissed within one hundred twenty (120) days and (ii) could reasonably be expected to result in the confiscation or forfeiture of any material portion of the Collateral;
 
(s)   the imposition of any stay or other order, the effect of which could reasonably be to restrain in any material way the conduct by the Loan Parties, taken as a whole, of their business in the ordinary course; or
 
(t)   except as otherwise permitted hereunder, the determination by any Loan Party, whether by vote of such Person’s board of directors or otherwise to: suspend the operation of such Person’s business in the ordinary course, liquidate all or a material portion of such Person’s assets or store locations, or employ an agent or other third party to conduct any so-called store closing, store liquidation or “Going-Out-Of-Business” sales.
 
then, and in every such event (other than an event with respect to each Loan Party described in clause (h) or (i) of this Section), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Lead Borrower, take any of the following actions, at the same or different times: (i) reduce the Total Commitments, or the advance rates against Eligible Accounts and/or Eligible Inventory used in computing the Borrowing Base, or reduce one or more of the other elements used in computing the Borrowing Base or, without limiting the definitions of Availability Reserves or Inventory Reserves, establish additional Reserves or increase any Reserves thereunder; (ii) restrict the amount of or refuse to make Revolving Loans; (iii) restrict or refuse to provide Letters of Credit or Acceptances, (iv) terminate the Commitments, and thereupon the Commitments shall terminate immediately, and (v) declare the Loans and other Obligations then outstanding to be due and payable, and thereupon the principal of the Loans and Obligations so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrowers accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers; and (vi) require the Borrowers to furnish cash collateral in an amount equal to 105% of the Letter of Credit Outstandings, (to be applied in accordance with the provisions of Section 2.7(k) hereof) and in case of any event with respect to any Borrower described in clause (h) or (i) of this Section, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Loan Parties accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Loan Parties.
 
7.2   ­Remedies on Default .  In case any one or more of the Events of Default shall have occurred and be continuing, and whether or not the maturity of the Loans and other Obligations shall have been accelerated pursuant hereto, the Administrative Agent may, and at the direction of the Required Lenders shall, proceed to protect and enforce its rights and remedies under this Agreement or any of the other Loan Documents by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Obligations are evidenced, and, if such amount shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or equitable right of the Agents or the Lenders. No remedy herein is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or any other provision of law.
 
7.3   ­Application of Proceeds . After the occurrence of an Event of Default and acceleration of the Obligations, all proceeds realized from any Loan Party or on account of any Collateral shall be applied in the manner set forth in Section 2.24 of this Agreement. All amounts required to be applied to Loans hereunder (other than Swingline Loans) shall be applied ratably in accordance with each Lender’s Commitment Percentage.
 
8.     THE AGENTS .
 
8.1   Administration by Administrative Agent .  Each Lender, the Collateral Agent, the Issuing Banks, the Acceptance Lenders and each Secured Party hereby irrevocably designate Bank of America, N.A. as Administrative Agent under this Agreement and the other Loan Documents.  The general administration of the Loan Documents shall be by the Administrative Agent. The Lenders, the Collateral Agent, the Issuing Banks, the Acceptance Lenders and the Secured Parties each hereby irrevocably authorizes the Administrative Agent (i) to enter into the Loan Documents to which it is a party and (ii) at its discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto. The Administrative Agent shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall it have any fiduciary relationship with any Lender, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent.
 
8.2   Appointment and Duties of Collateral Agent . Each Lender, the Administrative Agent, the Issuing Banks, the Acceptance Lenders and each Secured Party hereby irrevocably (i) designate Bank of America, N.A. as Collateral Agent under this Agreement and the other Loan Documents, (ii) authorize the Collateral Agent to enter into the Security Documents and the other Loan Documents to which it is a party and to perform its duties and obligations thereunder, together with all powers reasonably incidental thereto, and (iii) agree and consent to all of the provisions of the Security Documents. All Collateral shall be held or administered by the Collateral Agent (or its duly-appointed agent) for its benefit and for the ratable benefit of the other Secured Parties. Any proceeds received by the Collateral Agent from the foreclosure, sale, lease or other disposition of any of the Collateral and any other proceeds received pursuant to the terms of the Security Documents or the other Loan Documents shall be paid over to the Administrative Agent for application as provided in Sections 2.20, 2.24, or 7.3, as applicable. The Collateral Agent shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall it have any fiduciary relationship with any Lender, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Collateral Agent.
 
Without limiting the generality of the foregoing, for the purposes of creating a solidarite′ active in accordance with Article 1541 of the Civil Code of Quebec, between each Secured Party, taken individually, and the Collateral Agent, each Loan Party and each Secured Party (on its own behalf) acknowledges and agrees with the Collateral Agent that such Secured Party and the Collateral Agent are conferred the legal status of solidary creditors of each Loan Party in respect of all Obligations, present and future, owed by each Loan Party to each Secured Party and the Agents hereunder and under the other Loan Documents (collectively, the “ Solidary Claim ”).  Accordingly, but subject (for the avoidance of doubt) to Article 1542 of the Civil Code of Quebec, each Loan Party is irrevocably bound to the Collateral Agent and each other Secured Party in respect of the entire Solidary Claim of the Collateral Agent and such Secured Party.  As a result of the foregoing, the parties hereto acknowledge that the Collateral Agent and each other Secured Party shall at all times have a valid and effective right of action for the entire Solidary Claim of the Collateral Agent and such other Secured Party and the right to give full acquittance for it and that, accordingly, without limiting the generality of the foregoing, the Collateral Agent, as solidary creditor for itself and each other Secured Party, shall, at all times have a valid and effective right of action in respect of all Obligations, present and future, owed by each Loan Party to the Collateral Agent and to the other Secured Parties or any of them under this Agreement and the other Loan Documents and the right to give a full acquittance for the same.  The parties further agree and acknowledge that the Collateral Agent's Liens on the Collateral shall be granted to the Collateral Agent, for its own benefit and for the benefit of the other Secured Parties and as solidary creditor as hereinabove set forth.
 
8.3   ­Sharing of Excess Payments ; Payments Set Aside .
 
(a)   Each of the Lenders, the Agents, the Issuing Banks and Acceptance Lenders agrees that if it shall, through the exercise of a right of banker’s lien, setoff or counterclaim against the Borrowers, including, but not limited to, a secured claim under Section 506 of the Bankruptcy Code or other security or interest arising from, or in lieu of, such secured claim and received by such Lender, Agent, Issuing Bank or Acceptance Lender under any applicable bankruptcy, insolvency or other similar law, or otherwise, obtain payment in respect of the Obligations owed it (an “ excess payment ”) as a result of which such Lender, Agent, Issuing Bank or Acceptance Lender has received payment of any Loans or other Obligations outstanding to it in excess of the amount that it would have received if all payments at any time applied to the Loans and other Obligations had been applied in the order of priority set forth in Section 7.3, then such Lender, Agent, Issuing Bank or Acceptance Lender shall promptly purchase at par (and shall be deemed to have thereupon purchased) from the other Lenders, such Agent, the Issuing Banks and Acceptance Lenders, as applicable, a participation in the Loans and Obligations outstanding to such other Persons, in an amount determined by the Administrative Agent in good faith as the amount necessary to ensure that the economic benefit of such excess payment is reallocated in such manner as to cause such excess payment and all other payments at any time applied to the Loans and other Obligations to be effectively applied in the order of priority set forth in Section 7.3 pro rata in proportion to its Commitment Percentage; provided , that if any such excess payment is thereafter recovered or otherwise set aside such purchase of participations shall be correspondingly rescinded (without interest). The Borrowers expressly consent to the foregoing arrangements and agree that any Lender, any Agent, any Issuing Bank, or any Acceptance Lender holding (or deemed to be holding) a participation in any Loan or other Obligation may exercise any and all rights of banker’s lien, setoff or counterclaim with respect to any and all moneys owing by such Borrower to such Lender, Agent, Issuing Bank or Acceptance Lender as fully as if such Lender, Agent, Issuing Bank, or Acceptance Lender held a Note and was the original obligee thereon, in the amount of such participation.
 
(b)   To the extent that any payment by or on behalf of the Loan Parties is made to any Lender, or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under the Bankruptcy Code or otherwise, then (i) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (ii) each Lender, Issuing Bank and Acceptance Lender severally agrees to pay to the Agents upon demand its pro rata share (without duplication) of any amount so recovered from or repaid by the Agents.  The obligations of the Lenders, the Issuing Banks and the Acceptance Lenders under clause (ii) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.
 
8.4   ­Agreement of Applicable Lenders . Upon any occasion requiring or permitting an approval, consent, waiver, election or other action on the part of the Applicable Lenders, action shall be taken by the Agents for and on behalf or for the benefit of all Lenders upon the direction of the Applicable Lenders, and any such action shall be binding on all Lenders. No amendment, modification, consent, or waiver shall be effective except in accordance with the provisions of Section 9.2.
 
8.5   ­Liability of Agents .
 
(a)   Each of the Agents, when acting on behalf of the Lenders, the Issuing Banks and Acceptance Lenders, may execute any of its respective duties under this Agreement by or through any of its respective officers, agents and employees, and none of the Agents nor their respective directors, officers, agents or employees shall be liable to the Lenders, Issuing Banks or Acceptance Lenders or any of them for any action taken or omitted to be taken in good faith, or be responsible to the Lenders, Issuing Banks or Acceptance Lenders or to any of them for the consequences of any oversight or error of judgment, or for any loss, except to the extent of any liability imposed by law by reason of such Agent’s own gross negligence or willful misconduct. The Agents and their respective directors, officers, agents and employees shall in no event be liable to the Lenders, Issuing Banks or Acceptance Lenders or to any of them for any action taken or omitted to be taken by them pursuant to instructions received by them from the Applicable Lenders or in reliance upon the advice of counsel selected by it. Without limiting the foregoing, none of the Agents, nor any of their respective directors, officers, employees, or agents (A) shall be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, or (B) shall have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent or the Collateral Agent, as applicable, is required to exercise as directed in writing by the Applicable Lenders, provided that no Agent shall be required to take any action that, in its respective opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable law, or (C) shall, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, or shall be liable for the failure to disclose, any information relating to the Loan Parties or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent, the Collateral Agent or any of its Affiliates in any capacity, or (D) shall be responsible to any Lender, Issuing Bank or Acceptance Lender for the due execution, validity, genuineness, effectiveness, sufficiency, or enforceability of, or for any recital, statement, warranty or representation in, this Agreement, any Loan Document or any related agreement, document or order, or (E) shall be required to ascertain or to make any inquiry concerning the performance or observance by any Loan Party of any of the terms, conditions, covenants, or agreements of this Agreement or any of the Loan Documents, or (F) shall be responsible to any Lender, Issuing Bank or Acceptance Lender for the state or condition of any properties of the Loan Parties or any other obligor hereunder constituting Collateral for the Obligations of the Loan Parties hereunder or under any of the other Loan Documents, or any information contained in the books or records of the Loan Parties; or (G) shall be responsible to any Lender, Issuing Bank or Acceptance Lender for the validity, enforceability, collectibility, effectiveness or genuineness of this Agreement or any other Loan Document or any other certificate, document or instrument furnished in connection therewith; or (H) shall be responsible to any Lender, Issuing Bank or Acceptance Lender for the validity, priority or perfection of any Lien securing or purporting to secure the Obligations or the value or sufficiency of any of the Collateral.
 
(b)   The Agents may execute any of their duties under this Agreement or any other Loan Document by or through their agents or attorneys-in-fact, and shall be entitled to the advice of counsel concerning all matters pertaining to their rights and duties hereunder or under the Loan Documents.  The Agents shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by them with reasonable care.
 
(c)   None of the Agents nor any of their respective directors, officers, employees, or agents shall have any responsibility to the Borrowers on account of the failure or delay in performance or breach by any Lender (other than by any Agent in its capacity as a Lender), Issuing Bank or Acceptance Lender of any of their respective obligations under this Agreement or any of the other Loan Documents or in connection herewith or therewith.
 
(d)   The Agents shall be entitled to rely, and shall be fully protected in relying, upon any notice, consent, certificate, affidavit, or other document or writing believed by them to be genuine and correct and to have been signed, sent or made by the proper person or persons, and upon the advice and statements of legal counsel (including, without, limitation, counsel to the Loan Parties), independent accountants and other experts selected by the Agents.  The Agents shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless they shall first receive such advice or concurrence of the Applicable Lenders as they deem appropriate or they shall first be indemnified to their satisfaction by the Lenders against any and all liability and expense which may be incurred by them by reason of the taking or failing to take any such action.
 
8.6   Notice of Default . The Agents shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless the Agents have actual knowledge of the same or have received notice from a Lender or the Lead Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”.  In the event that the Agents obtain such actual knowledge or receives such a notice, the Agents shall give prompt notice thereof to each of the Lenders.  The Agents shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Applicable Lenders.  Unless and until the Agents shall have received such direction, the Agents may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to any such Default or Event of Default as they shall deem advisable in the best interest of the Lenders.  In no event shall the Agents be required to comply with any such directions to the extent that the Agents believe that the Agents’ compliance with such directions would be unlawful.
 
8.7   Lenders’ Credit Decisions . Each Lender acknowledges that it has, independently and without reliance upon the Agents or any other Lender, and based on the financial statements prepared by the Loan Parties and such other documents and information as it has deemed appropriate, made its own credit analysis and investigation into the business, assets, operations, property, and financial and other condition of the Loan Parties and has made its own decision to enter into this Agreement and the other Loan Documents.  Each Lender also acknowledges that it will, independently and without reliance upon the Agents or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in determining whether or not conditions precedent to closing any Loan hereunder have been satisfied and in taking or not taking any action under this Agreement and the other Loan Documents.
 
8.8   ­Reimbursement and Indemnification . Each Lender agrees (i) to reimburse (x) each Agent for such Lender’s Commitment Percentage of any expenses and fees incurred by such Agent for the benefit of the Lenders, Issuing Banks or Acceptance Lenders under this Agreement and any of the other Loan Documents, including, without limitation, counsel fees and compensation of agents and employees paid for services rendered on behalf of the Lenders, Issuing Banks or Acceptance Lenders, and any other expense incurred in connection with the operations or enforcement thereof not reimbursed by the Loan Parties and (y) each Agent for such Lender’s Commitment Percentage of any expenses of such Agent incurred for the benefit of the Lenders, Issuing Banks or Acceptance Lenders that the Loan Parties have agreed to reimburse pursuant to Section 9.3 of this Agreement or pursuant to any other Loan Document and has failed to so reimburse and (ii) to indemnify and hold harmless the Agents and any of their directors, officers, employees, or agents, on demand, in the amount of such Lender’s Commitment Percentage, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, or disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or asserted against it or any of them in any way relating to or arising out of this Agreement or any of the Loan Documents or any action taken or omitted by it or any of them under this Agreement or any of the other Loan Documents to the extent not reimbursed by the Borrowers (except such as shall result from their respective gross negligence or willful misconduct).  The provisions of this Section 8.8 shall survive the repayment of the Obligations and the termination of the Commitments.
 
8.9   ­Rights of Agents . It is understood and agreed that the Agents shall have the same rights and powers hereunder (including the right to give such instructions) as the other Lenders and may exercise such rights and powers, as well as its rights and powers under other agreements and instruments to which it is or may be party, and engage in other transactions with the Loan Parties, as though it were not the Administrative Agent or the Collateral Agent, respectively, of the Lenders under this Agreement.  Without limiting the foregoing, the Agents and their Affiliates may accept deposits from, lend money to, and generally engage in any kind of commercial or investment banking, trust, advisory or other business with the Loan Parties and their Subsidiaries and Affiliates as if they were not the Agents hereunder.
 
8.10   ­Notice of Transfer . The Agents may deem and treat a Lender party to this Agreement as the owner of such Lender’s portion of the Obligations for all purposes, unless and until, and except to the extent, an Assignment and Acceptance shall have become effective as set forth in Section 9.5(b).
 
8.11   ­Successor Agent . Any Agent may resign at any time by giving five (5) Business Days’ written notice thereof to the Lenders, the Issuing Banks, the Acceptance Lenders, the other Agents and the Lead Borrower. Upon any such resignation of any Agent, the Required Lenders shall have the right to appoint a successor Agent, which so long as there is no Default or Event of Default shall be reasonably satisfactory to the Lead Borrower (whose consent shall not be unreasonably withheld or delayed). If no successor Agent shall have been so appointed by the Required Lenders and shall have accepted such appointment, within 30 days after the retiring Agent’s giving of notice of resignation, the retiring Agent may, on behalf of the Lenders, the other Agents, the Issuing Banks and the Acceptance Lenders, appoint a successor Agent which shall be (i) a commercial bank (or affiliate thereof) organized under the laws of the United States of America or of any State thereof and having a combined capital and surplus of a least $100,000,000, (ii) or a Person capable of complying with all of the duties of such Agent (and the Issuing Banks), hereunder (in the opinion of the retiring Agent and as certified to the Lenders in writing by such successor Agent) which, in the case of (i) and (ii) above, so long as there is no Default or Event of Default shall be reasonably satisfactory to the Lead Borrower (whose consent shall not be unreasonably withheld or delayed). Upon the acceptance of any appointment as Agent by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent and the retiring Agent shall be discharged from its duties and obligations under this Agreement. After any retiring Agent’s resignation hereunder as such Agent, the provisions of this Section 8 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was such Agent under this Agreement.
 
8.12   ­Reports and Financial Statements . Promptly after receipt thereof from the Borrowers, the Administrative Agent shall remit to each Lender and the Collateral Agent copies of all financial statements required to be delivered by the Borrowers hereunder and all commercial finance examinations and appraisals of the Collateral received by the Administrative Agent (collectively, the “Reports”) .  Each Lender
 
(i)   expressly agrees and acknowledges that the Administrative Agent makes no representation or warranty as to the accuracy of the Reports, and (ii) shall not be liable for any information contained in any Report;
 
(ii)   expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that the Administrative Agent or any other Person performing any audit or examination will inspect only specific information regarding the Loan Parties and will rely significantly upon the Loan Parties’ books and records, as well as on representations of the Loan Parties’ personnel;
 
(iii)   subject to the provisions of Section 9.16, if applicable, agrees to keep all Reports confidential and strictly for its internal use, and not to distribute except to its Participants, or use any Report in any other manner; and
 
(iv)   without limiting the generality of any other indemnification provision contained in this Agreement, agrees:  (i) to hold the Agents and any such other Lender preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any Credit Extensions that the indemnifying Lender has made or may make to the Loan Parties, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a Loan or Loans of the Borrowers; and (ii) to pay and protect, and indemnify, defend, and hold the Agents and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including attorney costs) incurred by the Agents and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender.
 
8.13   Defaulting Lender .  Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:
 
(a)   The sum of such Defaulting Lender’s outstanding Revolving Credit Loans plus its risk participations in outstanding Swingline Loans and Letter of Credit Outstandings (collectively, its “ Credit Exposure ”) and such Defaulting Lender’s Commitment shall not be included in determining whether all Lenders or the Required Lenders have taken or may take any action hereunder (including any consent to any amendment or waiver pursuant to Section 9.2); provided that any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender which affects such Defaulting Lender differently than other affected Lenders shall require the consent of such Defaulting Lender;
 
(b)   Subject to clause (c) below, a Defaulting Lender shall be deemed to have assigned any and all payments due to it from the Loan Parties, whether on account of outstanding Loans, interest, fees or otherwise, to the remaining non-defaulting Lenders for application to, and reduction of, their proportionate shares of all outstanding Obligations until, as a result of application of such assigned payments, the Lenders’ respective Commitment Percentages of all outstanding Obligations shall have returned to those in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such delinquency;
 
(c)   At the option of the Borrowers, any amount payable to such Defaulting Lender hereunder (whether on account of principal, interest, fees or otherwise and including any amount that would otherwise be payable to such Defaulting Lender pursuant to Section 8.3) shall, in lieu of being distributed to such Defaulting Lender, be retained by the Administrative Agent in a segregated account and, subject to any applicable requirements of law, be applied at such time or times as may be determined by the Administrative Agent, (i) first, to the payment of any amounts owing by such Defaulting Lender to any Administrative Agent hereunder, (ii) second, pro rata, to the payment of any amounts owing by such Defaulting Lender to any Issuing Bank or the Swingline Lender hereunder, (iii) third, if so determined by the Administrative Agent or requested by an Issuing Bank or the Swingline Lender, held in such account as cash collateral for future funding obligations of the Defaulting Lender in respect of any existing or future participating interest in any Swingline Loan or Letter of Credit, (iv) fourth, to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent, (v) fifth, if so determined by the Administrative Agent and the Borrowers, held in such account as cash collateral for future funding obligations of the Defaulting Lender in respect of any Loans under this Agreement, (vi) sixth, to the payment of any amounts owing to the Lenders or any Issuing Bank or the Swingline Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender or such Issuing Bank or Swingline Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement, and (vii) seventh, to such Defaulting Lender; provided that if such payment is (x) a prepayment of the principal amount of any Loans or reimbursement obligations in respect of LC Disbursements which a Defaulting Lender has funded its participation obligations and (y) made at a time when the conditions set forth in Section 4.2 are satisfied, such payment shall be applied solely to prepay the Loans of, and reimbursement obligations owed to, all non-Defaulting Lenders pro rata prior to being applied to the prepayment of any Loans, or reimbursement obligations owed to, any Defaulting Lender.
 
(d)   The Defaulting Lender’s decision-making and participation rights and rights to payments as set forth in clauses (a) through (c) hereinabove shall be restored only upon the payment by the Defaulting Lender of its Commitment Percentage of any Obligations, any participation obligation, or expenses as to which it is delinquent, together with interest thereon at the rate set forth in Section 2.11 hereof from the date when originally due until the date upon which any such amounts are actually paid.
 
(e)   The non-defaulting Lenders shall also have the right, but not the obligation, in their respective, sole and absolute discretion, to acquire for no cash consideration, ( pro rata , based on the respective Commitments of those Lenders electing to exercise such right) the Defaulting Lender’s Commitment to fund future Loans (the “ Defaulting Lender’s Future Commitment ”).  Upon any such purchase of the Commitment Percentage of any Defaulting Lender’s Future Commitment, the Defaulting Lender’s share in future Loans and its rights under the Loan Documents with respect thereto shall terminate on the date of purchase, and the Defaulting Lender shall promptly execute all documents reasonably requested to surrender and transfer such interest, including, if so requested, an Assignment and Acceptance.  Each Defaulting Lender shall indemnify the Agents and each non-defaulting Lender from and against any and all loss, damage or expenses, including but not limited to reasonable attorneys’ fees and funds advanced by any Agent or by any non-defaulting Lender, on account of a Defaulting Lender’s failure to timely fund its pro rata share of a Loan or to otherwise perform its obligations under the Loan Documents.  Nothing contained in this Section 8.13(e) shall be deemed to limit or modify the rights of the Borrowers pursuant to Section 2.30 hereof.
 
8.14   Agency for Perfection .  Each Lender hereby appoints each other Lender as agent for the purpose of perfecting Liens, for the benefit of the Agents and the Secured Parties, in assets which, in accordance with Article 9 of the UCC or any other Applicable Law of the United States of America or Canada under the PPSA or otherwise can be perfected only by possession.  Should any Lender (other than the Agents) obtain possession of any such Collateral, such Lender shall notify the Agents thereof, and, promptly upon the Agents’ request therefor shall deliver such Collateral to the Agents or otherwise deal with such Collateral in accordance with the Agents’ instructions.
 
8.15   Relation Among the Lenders .   The Lenders are not partners or co-venturers, and no Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of the Agents) authorized to act for, any other Lender.
 
8.16   Administrative Agent   May File Proofs of Claim .  In case of the pendency of any proceeding under the Bankruptcy Code or any other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or Letter of Credit or Acceptance shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Loan Parties) shall be entitled and empowered, by intervention in such proceeding or otherwise:
 
(a)   to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, Letters of Credit, Acceptance Reimbursement Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the Issuing Banks, the Acceptance Lenders, the Administrative Agent and the other Secured Parties (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the Issuing Banks, the Acceptance Lenders, the Administrative Agent, such Secured Parties and their respective agents and counsel and all other amounts due the Lenders, the Issuing Banks, the Acceptance Lenders, the Administrative Agent, such Secured Parties under Sections 2.7, 2.12, 2.13, 2.14, 2.15 and 9.3 allowed in such judicial proceeding; and
 
(b)   to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;
 
and any custodian, receiver, assignee, trustee, liquidator, sequestrator, monitor or other similar official in any such judicial proceeding is hereby authorized by each Lender, Issuing Bank and Acceptance Lender to make such payments to the Administrative Agent and, if the Administrative Agent shall consent to the making of such payments directly to the Lenders, the Issuing Banks and the Acceptance Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.12 through 2.15 and 9.3.
 
Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender, any Issuing Bank or any Acceptance Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender, any Issuing Bank or any Acceptance Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender, any Issuing Bank or any Acceptance Lender in any such proceeding.

8.17   Collateral and Guaranty Matters .  The Lenders irrevocably authorize the Agents, at their option and in their discretion,
 
(a)   to execute a release of any Lien on any property granted to or held by the Collateral Agent under any Loan Document (i) upon termination of the Total Commitments and (A) payment in full of all Obligations (other than contingent indemnification obligations for which no claim has been asserted), (B) (x) the expiration or termination of all Letters of Credit or (y) the deposit of cash collateral with the Administrative Agent in an amount equal to 105% of the Letter of Credit Outstandings, and (C) the providing of collateral security to the extent required by Section 9.6 hereof, (ii) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, or (iii) if approved, authorized or ratified in writing by the Applicable Lenders in accordance with Section 9.2;
 
(b)   to subordinate any Lien on any property granted to or held by the Collateral Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 6.2(d); and
 
(c)   to release any Guarantor from its obligations under the Facility Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.
 
Upon request by any Agent at any time, the Applicable Lenders will confirm in writing such Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Facility Guaranty pursuant to this Section 8.17.  In each case as specified in this Section 8.17, the Agents will, at the Loan Parties’ expense, execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release of such item of Collateral from the assignment and security interest granted under the Security Documents or to subordinate its interest in such item, or to release such Guarantor from its obligations under the Facility Guaranty, in each case in accordance with the terms of the Loan Documents and this Section 8.17.

8.18   Syndication Agent, Documentation Agents, and Lead Arranger s and Lead Bookrunners . Notwithstanding the provisions of this Agreement or any of the other Loan Documents, the Syndication Agent and the co-Documentation Agents shall have no powers, rights, duties, responsibilities or liabilities in such capacities with respect to this Agreement and the other Loan Documents.
 
9.     MISCELLANEOUS .
 
9.1   Notices . Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:
 
(a)   if to any Loan Party, to it at Brown Shoe Company, Inc., 8300 Maryland Avenue, St. Louis, Missouri 63105, Attention: Chief Financial Officer (Telecopy No. (314) 854-2152), with a copies to Bryan Cave LLP, One Metropolitan Square, 211 North Broadway, St. Louis, Missouri 63102, Attention: William Seabaugh, Esquire (Telecopy No. (314) 259-2020) and Bryan Cave LLP 1290 Avenue of the Americas, New York, New York 10104, Attention: Jeffrey S. Chavkin, Esquire (Telecopy No. (212) 904-0501);
 
(b)   if to the Administrative Agent or the Collateral Agent, to Bank of America, N.A., 100 Federal Street, Boston, Massachusetts 02110, Attention: Keith Vercauteren (Telecopy No. (617) 434-4339), with a copy (other than with respect to notices of borrowing and interest rate elections or conversions) to Riemer & Braunstein LLP, Three Center Plaza, Boston, Massachusetts 02108, Attention: David S. Berman, Esquire (Telecopy No. (617) 880-3456);
 
(c)   if to any other Lender, to it at its address (or telecopy number) set forth on the signature pages hereto or on any Assignment and Acceptance for such Lender.
 
Any party hereto may change its address or telecopy number for notices and other communi­cations hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given three days after mailing or otherwise on the date of receipt.
 
9.2   Waivers; Amendments .
 
(a)   No failure or delay by the Agents, the Issuing Banks, the Acceptance Lenders or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discon­tinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Agents, the Issuing Banks, the Acceptance Lenders and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit or Acceptance shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Agents, any Lender, any Issuing Bank or any Acceptance Lender may have had notice or knowledge of such Default or Event of Default at the time.
 
(b)   Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except, in the case of this Agree­ment, pursuant to an agreement or agreements in writing entered into by the Loan Parties and the Required Lenders or, in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Agents and the Loan Parties that are parties thereto, in each case with the consent of the Required Lenders, provided that no such agreement shall (i) increase the Commitment of any Lender without such Lender’s prior consent, (ii) except as provided in Section 2.2, increase the Total Commitments without the written consent of all of the Lenders, (iii) reduce the principal amount of any Loan or L/C Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby, (iv) postpone the scheduled date of payment of the principal amount of any Loan or L/C Disbursement, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of the Commitments or the Maturity Date, without the written consent of each Lender affected thereby, (v) change Sections 2.8(b), 2.8(c), 2.20, 2.23, or 2.24, without the written consent of each Lender, (vi) change any of the provisions of this Section 9.2 or the definition of the term “Required Lenders”, “Super-Majority Lenders”, “Minority Lenders” or any other provision of any Loan Document specifying the number or percentage of Lenders required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender, (vii) release any Loan Party from its obligations under any Loan Document, or limit its liability in respect of such Loan Document (except to the extent permitted in the Loan Documents), without the written consent of each Lender, (viii) except for sales described in Section 6.5 or as permitted in the Security Documents, release any material portion of the Collateral from the Liens of the Security Documents, without the written consent of each Lender, (ix) change the definition of the term “Borrowing Base” or any component definition thereof if as a result thereof the amounts available to be borrowed by the Borrowers would be increased, without the written consent of each Lender, provided that the foregoing shall not limit the discretion of the Administrative Agent to change, establish or eliminate any Reserves, provided further that the Administrative Agent shall not change or eliminate the Reserve set forth in Section 5.5(b) hereof without the consent of the Super-Majority Lenders, (x) increase the Permitted Overadvance, without the written consent of each Lender, (xi) except as permitted hereunder, subordinate the Obligations hereunder, or the Liens granted hereunder or under the other Loan Documents, to any other Indebtedness or Lien, as the case may be without the prior written consent of each Lender, or (xii) increase the amount available as Swingline Loans without the prior written consent of each Lender, and provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Agents, the Issuing Banks or the Acceptance Lenders without the prior written consent of the Agents, the applicable Issuing Bank or the applicable Acceptance Lender, as the case may be.
 
(c)   Notwithstanding anything to the contrary contained in this Section 9.2, in the event that the Lead Borrower requests that this Agreement or any other Loan Document be modified, amended or waived in a manner which would require the consent of the Lenders pursuant to Section 9.2(b) and such amendment is approved by the Required Lenders, but not by the requisite percentage of the Lenders, the Borrowers, and the Required Lenders shall be permitted to amend this Agreement without the consent of the Lender or Lenders which did not agree to the modification or amendment requested by the Lead Borrower (such Lender or Lenders, collectively the “ Minority Lenders ”) subject to providing for (w) the termination of the Commitment of each of the Minority Lenders, (x) the addition to this Agreement of one or more other financial institutions which would qualify as an Eligible Assignee (subject to the approval of the Administrative Agent, which approval shall not be unreasonably withheld), or an increase in the Commitment of one or more of the Required Lenders, so that the Total Commitments after giving effect to such amendment shall be in the same amount as the Total Commitments immediately before giving effect to such amendment, (y) if any Loans are outstanding at the time of such amendment, the making of such additional Loans by such new or increasing Lender or Lenders, as the case may be, as may be necessary to repay in full the outstanding Loans (including principal, interest, and fees) of the Minority Lenders immediately before giving effect to such amendment and (z) such other modifications to this Agreement or the Loan Documents as may be appropriate and incidental to the foregoing.
 
(d)   No notice to or demand on any Loan Party shall entitle any Loan Party to any other or further notice or demand in the same, similar or other circumstances. Each holder of a Note shall be bound by any amendment, modification, waiver or consent authorized as provided herein, whether or not a Note shall have been marked to indicate such amendment, modification, waiver or consent and any consent by a Lender, or any holder of a Note, shall bind any Person subsequently acquiring a Note, whether or not a Note is so marked. No amendment to this Agreement shall be effective against any Loan Party unless signed by the applicable Loan Party.
 
9.3   Expenses; Indemnity; Damage Waiver   .  The Loan Parties shall jointly and severally pay (i) all reasonable out-of-pocket expenses incurred by the Agents and their Affiliates, including the reasonable fees, charges and disbursements of counsel for the Agents, outside consultants for the Agents, appraisers, and for commercial finance examinations, in connection with the arrangement of the credit facilities provided for herein, the preparation and administration of the Loan Documents or any amendments, modifications or waivers of the provi­sions thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing Banks or Acceptance Lenders in connection with the issuance, amendment, renewal or extension of any Letter of Credit or Acceptance or any demand for payment thereunder, and (iii) all reasonable out-of-pocket expenses incurred by the Agents, the Issuing Banks, the Acceptance Lenders or any Lender, including the reasonable fees, charges and disbursements of any counsel and any outside consultants for the Agents, or the Issuing Banks, Acceptance Lenders or Lenders, for appraisers, commercial finance examinations, and environmental site assessments, in connection with the enforcement or protection of its rights in connection with the Loan Documents, including its rights under this Section, or in connection with the Loans made or Letters of Credit or Acceptances issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit or Acceptances; provided that the Lenders who are not the Agents, the Issuing Banks or the Acceptance Lenders shall be entitled to reimbursement for no more than one counsel representing all such Lenders (absent a conflict of interest in which case the Lenders may engage and be reimbursed for additional counsel).
 
(b)   The Loan Parties shall jointly and severally indemnify the Agents, the Issuing Banks, the Acceptance Lenders and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the reasonable fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of any Loan Document or any other agreement or instrument contemplated hereby, the performance by the parties to the Loan Documents of their respective obligations thereunder or the consummation of the transactions contemplated by the Loan Documents or any other transactions contemplated hereby, (ii) any Loan or Letter of Credit or Acceptance or the use of the proceeds therefrom (including any refusal by an Issuing Bank or Acceptance Lender to honor a demand for payment under a Letter of Credit or Acceptance if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit or Acceptance), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property currently or formerly owned or operated by any Loan Party, or any Environmental Liability of any Loan Party, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto, or (v) any documentary taxes, assessments or similar charges made by any Governmental Authority by reason of the execution and delivery of this Agreement or any other Loan Document, provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee or any Affiliate of such Indemnitee (or of any officer, director, employee, advisor or agent of such Indemnitee or any such Indemnitee’s Affiliates).  In connection with any indemnified claim hereunder, the Indemnitee shall be entitled to select its own counsel and the Loan Parties shall promptly pay the reasonable fees and expenses of such counsel.
 
(c)   To the extent that any Borrower fails to pay any amount required to be paid by it to the Agents, the Issuing Banks or Acceptance Lenders under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Agents, the Issuing Banks or the Acceptance Lenders, as the case may be, such Lender’s Commitment Percentage of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Agents, the Issuing Banks or the Acceptance Lenders.
 
(d)   To the extent permitted by Applicable Law, no Loan Party shall assert, and each Loan Party hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any other Loan Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated by the Loan Documents, any Loan or Letter of Credit or Acceptance or the use of the proceeds thereof.
 
(e)   All amounts due under this Section shall be payable promptly after written demand therefor, which demand shall include calculations of the amount claimed in reasonable detail.
 
9.4   Designation of Lead Borrower as Borrowers’ Agent .
 
(a)   Each Borrower hereby irrevocably designates and appoints the Lead Borrower as that Borrower’s agent to obtain Loans and Letters of Credit or Acceptances hereunder, the proceeds of which shall be available to each Borrower for those uses as those set forth herein. As the disclosed principal for its agent, each Borrower shall be obligated to the Agents and each Lender on account of Loans so made and Letters of Credit and Acceptances so issued hereunder as if made directly by the Lenders to that Borrower, notwithstanding the manner by which such Loans and Letters of Credit and Acceptances are recorded on the books and records of the Lead Borrower and of any Borrower.
 
(b)   Each Borrower recognizes that credit available to it hereunder is in excess of and on better terms than it otherwise could obtain on and for its own account and that one of the reasons therefor is its joining in the credit facility contemplated herein with all other Borrowers. Consequently, each Borrower hereby assumes, guarantees, and agrees to discharge all Obligations of all other Borrowers as if the Borrower so assuming and guarantying were each other Borrower.
 
(c)   Subject to Section 2.7, the Lead Borrower shall act as a conduit for each Borrower (including itself, as a “Borrower”) on whose behalf the Lead Borrower has requested a Loan.
 
(i)    The Lead Borrower shall cause the transfer of the proceeds of each Loan to the (those) Borrower(s) on whose behalf such Loan was obtained. Neither the Agents nor any Lender shall have any obligation to see to the application of such proceeds.
 
(ii)   If, for any reason, and at any time during the term of this Agreement,
 
(A)           any Borrower, including the Lead Borrower, as agent for the Borrowers, shall be unable to, or prohibited from carrying out the terms and conditions of this Agreement; or
 
(B)           the Administrative Agent deems it inexpedient (in the Administrative Agent’s sole and absolute discretion) to continue making Loans and cause Letters of Credit and Acceptances to be issued to or for the account of any particular Borrower, or to channel such Loans and Letters of Credit and Acceptances through the Lead Borrower,
 
then the Lenders may make Loans directly to, and cause the issuance of Letters of Credit and Acceptances directly for the account of such of the Borrowers as the Administrative Agent determines to be expedient, which Loans may be made without regard to the procedures otherwise included herein.

(d)   In the event that the Administrative Agent determines to forgo the procedures included herein pursuant to which Loans and Letters of Credit and Acceptances are to be channeled through the Lead Borrower, then the Administrative Agent may designate one or more of the Borrowers to fulfill the financial and other reporting requirements otherwise imposed herein upon the Lead Borrower.
 
(e)   Each of the Borrowers shall remain jointly and severally liable to the Agents and the Lenders for the payment and performance of all Obligations (which payment and perfor­mance shall continue to be secured by all Collateral granted by each of the Borrowers) notwithstanding any determination by the Administrative Agent to cease making Loans or causing Letters of Credit or Acceptances to be issued to or for the benefit of any Borrower.
 
(f)   The authority of the Lead Borrower to request Loans on behalf of, and to bind, the Borrowers, shall continue unless and until the Administrative Agent acts as provided in subparagraph (c), above, or the Administrative Agent actually receives
 
(i)   written notice of: (i) the termina­tion of such authority, and (ii) the subsequent appointment of a successor Lead Borrower, which notice is signed by the respective Presidents of each Borrower (other than the President of the Lead Borrower being replaced) then eligible for borrowing under this Agreement; and
 
(ii)   written notice from such successive Lead Borrower (i) accept­ing such appointment; (ii) acknowledging that such removal and appoint­ment has been effected by the respective Presidents of such Borrowers eligible for borrowing under this Agreement; and (iii) acknowledging that from and after the date of such appointment, the newly appointed Lead Borrower shall be bound by the terms hereof, and that as used herein, the term “Lead Borrower” shall mean and include the newly appointed Lead Borrower.
 
9.5   Successors and Assigns   .  (a)           The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of an Issuing Bank or Acceptance Lender that issues any Letter of Credit or Acceptance), except that no Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any such attempted assignment or transfer without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank or Acceptance Lender that issues any Letter of Credit or Acceptance) and, to the extent expressly contemplated hereby, the Related Parties of each of the Agents, the Issuing Banks, the Acceptance Lenders and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
 
(b)   Any Lender may assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it), provided that (i) except in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund, each of the Lead Borrower (but only if no Event of Default then exists), the Agents, the Lead Issuing Bank and the other Lenders that are then Issuing Banks must give their prior written consent to such assignment (which consent shall not be unreasonably withheld or delayed), (ii) except in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent) shall not be less than $10,000,000 (and in $2,500,000 integral multiples in excess thereof) unless the Administrative Agent otherwise consents, (iii) unless a Lender has assigned and delegated all of its rights and obligations under the Loan Documents, no such assignment and/or delegation shall be permitted unless, after giving effect thereto, such Lender retains a Commitment in a minimum amount of $10,000,000, (iv) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations, and (v) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $5,000.  Subject to acceptance and recording thereof pursuant to paragraph (d) of this Section, from and after the effective date specified in each Assignment and Acceptance the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obliga­tions under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Section 9.3). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (e) of this Section.  The Loan Parties hereby acknowledge and agree that any assignment shall give rise to a direct obligation of the Loan Parties to the assignee and that the assignee shall be considered to be a “Lender” for all purposes under this Agreement and the other Loan Documents
 
(c)   The Administrative Agent, acting for this purpose as an agent of the Loan Parties, shall maintain at one of its offices in Boston, Massachusetts a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans and L/C Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive absent manifest error and the Loan Parties, the Administrative Agent, the Issuing Banks, the Acceptance Lenders and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Lead Borrower, the Issuing Banks, the Acceptance Lenders and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
 
(d)   Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an assignee, the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Acceptance and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
 
(e)   Any Lender may, without the consent of the Loan Parties, the Agents, and the Issuing Banks or Acceptance Lenders, sell participations to one or more banks or other entities (a “ Participant ”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it), provided that (i) such Lender’s obligations under this Agreement and the other Loan Documents shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the perform­ance of such obligations and (iii) the Loan Parties, the Agents, the Issuing Banks, the Acceptance Lenders and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells a participation in the Commitments, the Loans, the Letters of Credit Outstandings and the Acceptance Reimbursement Obligations shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the Loan Documents, provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.2(b) that affects such Participant. Subject to paragraph (f) of this Section, the Borrowers agree that each Participant shall be entitled to the benefits of Sections 2.25, 2.27, and 2.28 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.9 as though it were a Lender, provided such Participant agrees to be subject to Section 2.27(c) as though it were a Lender.
 
(f)   A Participant shall not be entitled to receive any greater payment under Sections 2.25, 2.27 and 2.28 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Lead Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.28 unless (i) the Lead Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Loan Parties, to comply with Section 2.28(e) as though it were a Lender and (ii) such Participant is eligible for exemption from the withholding tax referred to therein, following compliance with Section 2.28(e).
 
(g)   Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including, without limitation, any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest, provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
 
9.6   Survival . All covenants, agreements, representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit or Acceptances, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Agents, the Issuing Banks, the Acceptance Lenders or any Lender may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other Obligation is outstanding and unpaid or any Letter of Credit or Acceptance is outstanding and so long as the Commitments have not expired or terminated. The provisions of Sections 2.25, 2.28, and 9.3 and Section 8 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and Acceptances and the Commitments or the termination of this Agreement or any provision hereof.  In connection with the termination of this Agreement and the release and termination of the security interests in the Collateral, the Agents may require (x) such reasonable indemnities and/or collateral security in a form (including, without limitation, a letter of credit or cash collateral) and amount that is reasonable under the circumstances to protect the Agents, the Issuing Banks, the Acceptance Lenders and the Lenders against loss on account of credits previously applied to the Obligations that may subsequently be reversed or revoked, (y) collateral security in a form (including, without limitation, a letter of credit or cash collateral) and amount that is reasonable under the circumstances to protect the Agents, the Issuing Banks, the Acceptance Lenders and the Lenders against any obligations that (i) shall become due and owing with respect to any Hedging Agreements which do not terminate upon the termination of this Agreement or (ii) are then due and owing and have not then been paid with respect to any Cash Management Services or other Bank Products not covered in clause (i) above, and (z) collateral security in a form (including, without limitation, a letter of credit or cash collateral) and amount that is reasonable under the circumstances to protect the Agents, the Issuing Banks, the Acceptance Lenders and the Lenders against any claims asserted in writing at the time of such termination for indemnification in accordance with Section 9.3 hereof.
 
9.7   Counterparts; Integration; Effectiveness . This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and the Fee Letter constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.1, this Agreement shall become effective when it shall have been executed by the Agents and the Lenders and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.
 
9.8   Severability . Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
 
9.9   Right of Setoff . In addition to any rights or remedies of the Lenders provided by Applicable Law, if an Event of Default exists or the Revolving Credit Loans have been accelerated, each Lender is hereby authorized at any time and from time to time, without prior notice to the Loan Parties, any such notice being waived by the Loan Parties to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender or any Affiliate of such Lender to or for the credit or the account of the Loan Parties against any and all Obligations owing to such Lender, now or hereafter existing, irrespective of whether or not the Agent or such Lender shall have made demand under this Agreement or any other Loan Documents and although such Obligations may be contingent or unmatured or otherwise fully secured and regardless of the adequacy of the Collateral. Each Lender agrees to promptly notify the Loan Parties and the Agent after any such setoff and application made by such Lender; provided , however, the failure to give such notice shall not affect the validity of such setoff and application.  NOTWITHSTANDING THE FOREGOING, NO LENDER SHALL EXERCISE ANY RIGHT OF SETOFF, BANKER’S LIEN OR THE LIKE AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY OF ANY LOAN PARTY HELD OR MAINTAINED BY SUCH LENDER WITHOUT THE PRIOR WRITTEN CONSENT OF THE ADMINISTRATIVE AGENT OR THE REQUIRED LENDERS.
 
9.10   ­Governing Law; Jurisdiction; Consent to Service of Process . (a)  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO ITS PRINCIPLES RELATING TO CHOICE AND CONFLICTS OF LAW), BUT INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
 
(b)           The Loan Parties agree that any suit for the enforcement of this Agreement or any other Loan Document may be brought in any New York state or federal court sitting in the Borough of Manhattan as the Administrative Agent may elect in its sole discretion and consent to the non-exclusive jurisdiction of such courts.  The Borrowers hereby waive any objection which they may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum. The Borrowers agree that any action commenced by any Borrower asserting any claim or counterclaim arising under or in connection with this Agreement or any other Loan Document shall be brought solely in any New York state or federal court sitting in the Borough of Manhattan as the Administrative Agent may elect in its sole discretion and consent to the exclusive jurisdiction of such courts with respect to any such action.
 
(c)           Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.1. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
 
9.11   WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTA­TIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREE­MENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
 
9.12   Press Releases and Related Matters .   Each Loan Party hereby consents that the Agents and each Lender may issue and disseminate to the public general information describing the credit accommodation entered into pursuant to this Agreement, including the name and address of the Loan Parties and a general description of the Loan Parties’ business and may, with the Lead Borrower’s prior written consent, use each Loan Party’s name in advertising and other promotional material.
 
9.13   Headings . Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
 
9.14   Interest Rate Limitation . Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts that are treated as interest on such Loan under Applicable Law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) that may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with Applicable Law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.
 
9.15   ­Additional Waivers   .  (a)           The Obligations are the joint and several obligations of each Loan Party.  To the fullest extent permitted by Applicable Law, the obligations of the Loan Parties hereunder shall not be affected by (i) the failure of any Agent or any other Secured Party to assert any claim or demand or to enforce or exercise any right or remedy against any other Loan Party under the provisions of this Agreement, any other Loan Document or otherwise, (ii) any rescission, waiver, amendment or modification of, or any release from any of the terms or provisions of, this Agreement, any other Loan Document, or any other agreement, including with respect to any other Borrower of the Obligations under this Agreement, or (iii) the failure to perfect any security interest in, or the release of, the Collateral or any other the security held by or on behalf of the Collateral Agent or any other Secured Party.
 
(b)   The obligations of each Loan Party hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than the payment in full in cash of the Obligations), including any claim of waiver, release, surrender, alteration or compromise of any of the Obligations, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of the Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Loan Party hereunder shall not be discharged or impaired or otherwise affected by the failure of any Agent or any other Secured Party to assert any claim or demand or to enforce any remedy under this Agreement, any other Loan Document or any other agreement, by any waiver or modification of any provision of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the Obligations, or by any other act or omission that may or might in any manner or to any extent vary the risk of any Borrower or that would otherwise operate as a discharge of any Loan Party as a matter of law or equity (other than the payment in full in cash of all the Obligations).
 
(c)   To the fullest extent permitted by Applicable Law, each Loan Party waives any defense based on or arising out of any defense of any other Loan Party or the unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any other Loan Party, other than the payment in full in cash of all the Obligations. The Collateral Agent and the other Secured Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Obligations, make any other accommodation with any other Loan Party, or exercise any other right or remedy available to them against any other Loan Party, without affecting or impairing in any way the liability of any Loan Party hereunder except to the extent that all the Obligations have been paid in full in cash. Pursuant to Applicable Law, each Loan Party waives any defense arising out of any such election even though such election operates, pursuant to Applicable Law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Loan Party against any other Loan Party, as the case may be, or any security.
 
(d)   Each Borrower is obligated to repay the Obligations as joint and several obligors under this Agreement.  Upon payment by any Loan Party of any Obligations, all rights of such Loan Party against any other Loan Party arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subordinate and junior in right of payment to the prior payment in full in cash of all the Obligations. In addition, any indebtedness of any Loan Party now or hereafter held by any other Loan Party is hereby subordinated in right of payment to the prior payment in full of the Obligations. None of the Loan Parties will demand, sue for, or otherwise attempt to collect any such indebtedness. If any amount shall erroneously be paid to any Loan Party on account of (a) such subrogation, contribution, reimbursement, indemnity or similar right or (b) any such indebtedness of any Loan Party, such amount shall be held in trust for the benefit of the Secured Parties and shall forthwith be paid to the Collateral Agent to be credited against the payment of the Obligations, whether matured or unmatured, in accordance with the terms of the Loan Documents.  Subject to the foregoing, to the extent that any Borrower shall, under this Agreement as a joint and several obligor, repay any of the Obligations constituting Revolving Loans made to another Borrower hereunder or other Obligations incurred directly and primarily by any other Borrower (an “ Accommodation Payment ”), then the Borrower making such Accommodation Payment shall be entitled to contribution and indemnification from, and be reimbursed by, each of the other Borrowers in an amount, for each of such other Borrowers, equal to a fraction of such Accommodation Payment, the numerator of which fraction is such other Borrower's Allocable Amount and the denominator of which is the sum of the Allocable Amounts of all of the Borrowers.  As of any date of determination, the “ Allocable Amount ” of each Borrower shall be equal to the maximum amount of liability for Accommodation Payments which could be asserted against such Borrower hereunder without (a) rendering such Borrower “insolvent” within the meaning of Section 101 (31) of the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer Act (“ UFTA ”) or Section 2 of the Uniform Fraudulent Conveyance Act (“ UFCA ”), (b) leaving such Borrower with unreasonably small capital or assets, within the meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Borrower unable to pay its debts as they become due within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of the UFCA.
 
9.16   Confidentiality .   Each of the Agents, Issuing Banks, Acceptance Lenders and the Lenders agrees that it will use its best efforts not to disclose without the prior written consent of the Lead Borrower (other than to its employees, auditors, counsel or other professional advisors, to Affiliates or to another Lender if the Lender or such Lender’s holding or parent company in its sole discretion determines that any such party needs access to such information, which party shall be informed of the confidential nature thereof and shall agree to keep such information confidential in accordance with the terms of this Section 9.16) any information with respect to any Loan Party which is furnished pursuant to this Agreement and which either is financial information or is designated by the Lead Borrower to the Administrative Agent in writing as confidential, provided that any Lender may disclose any such information (a) as has become generally available to the public, (b) as was available to any Lender on a non-confidential basis prior to its disclosure by such Lender, (c) as becomes available to any Lender on a non-confidential basis from a Person other than a Loan Party who, to the best knowledge of such Lender, is not otherwise bound by a confidentiality agreement with any Loan Party or is not otherwise prohibited from transmitting the information to such Lender, (d) as may be required or appropriate in any report, statement or testimony submitted to any municipal, state or federal regulatory body having or claiming to have jurisdiction over such Lender or to the Federal Reserve Board or the Federal Deposit Insurance Corporation or similar organizations (whether in the United States of America or elsewhere) or their successors, (e) as may be required or appropriate in response to any summons or subpoena or in connection with any litigation, provided that if the Lender is able to do so prior to complying with the summons or subpoena, such Lender shall provide the Lead Borrower with prompt notice of such requested disclosure so that the Borrowers may seek a protective order or other appropriate remedy (nothing contained herein however shall result in such Lender’s non-compliance with Applicable Law), (f) in order to comply with any law, order, regulation or ruling applicable to such Lender, (g) in connection with the enforcement of remedies under this Agreement and the other Loan Documents, and (h) to any prospective transferee in connection with any contemplated transfer of any of the Loans or Notes or any interest therein by such Lender provided that such prospective transferee agrees to be bound by the provisions of this Section. The Borrowers hereby agree that the failure of a Lender to comply with the provisions of this Section 9.16 shall not relieve the Borrowers of any of their obligations to such Lender under this Agreement and the other Loan Documents.
 
9.17   Conflicts with other Loan Documents .  Unless otherwise expressly provided in this Agreement (or in another Loan Document by specific reference to the applicable provision contained in this Agreement), if any provision contained in this Agreement conflicts with any provision of any other Loan Document, the provision contained in this Agreement shall govern and control.
 
9.18   Judgment Currency . If for the purpose of obtaining judgment in any court it is necessary to convert an amount due hereunder in the currency in which it is due (the “ Original Currency ”) into another currency (the “ Second Currency ”), the rate of exchange applied shall be that at which, in accordance with normal banking procedures, the Administrative Agent could purchase in the Boston foreign exchange market, the Original Currency with the Second Currency on the date two (2) Business Days preceding that on which judgment is given. Each Borrower agrees that its obligation in respect of any Original Currency due from it hereunder shall, notwithstanding any judgment or payment in such other currency, be discharged only to the extent that, on the Business Day following the date the Administrative Agent receives payment of any sum so adjudged to be due hereunder in the Second Currency, the Administrative Agent may, in accordance with normal banking procedures, purchase, in the Boston foreign exchange market, the Original Currency with the amount of the Second Currency so paid; and if the amount of the Original Currency so purchased or could have been so purchased is less than the amount originally due in the Original Currency, each Borrower agrees as a separate obligation and notwithstanding any such payment or judgment to indemnify the Administrative Agent against such loss. The term “rate of exchange” in this Section 9.18 means the spot rate at which the Administrative Agent, in accordance with normal practices, is able on the relevant date to purchase the Original Currency with the Second Currency, and includes any premium and costs of exchange payable in connection with such purchase.
 
9.19   Patriot Act; Proceeds of Crime Act .
 
Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the Act. Each Loan Party has not violated and is in compliance, in all material respects, with the Patriot Act and the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada).  No part of the proceeds of the Loans will be used by the Loan Parties, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

9.20   Foreign Asset Control Regulations .
 
Neither of the advance of the Revolving Loans nor the use of the proceeds of any thereof will violate the Trading With the Enemy Act (50 U.S.C. § 1 et seq., as amended) (the " Trading With the Enemy Act ") or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) (the " Foreign Assets Control Regulations ") or any enabling legislation or executive order relating thereto (which for the avoidance of doubt shall include, but shall not be limited to (a) Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) (the " Executive Order ") and (b) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)).  Furthermore, none of the Borrowers or their Affiliates (a) is or will become a "blocked person" as described in the Executive Order, the Trading With the Enemy Act or the Foreign Assets Control Regulations or (b) engages or will engage in any dealings or transactions, or be otherwise associated, with any such "blocked person".

9.21   No Advisory or Fiduciary Responsibility .  
 
In connection with all aspects of each transaction contemplated hereby, the Loan Parties each acknowledge and agree that: (i) the credit facility provided for hereunder and any related arranging or other services in connection therewith (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between the Loan Parties, on the one hand, and the Agents and the Lenders, on the other hand, and each of the Loan Parties is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or other modification hereof or thereof); (ii) in connection with the process leading to such transaction, each of the Agents and each Lender is and has been acting solely as a principal and is not the financial advisor, agent or fiduciary, for the Loan Parties or any of their respective Affiliates, stockholders, creditors or employees or any other Person; (iii) none of the Agents or any Lender has assumed or will assume an advisory, agency or fiduciary responsibility in favor of the Loan Parties with respect to any of the transactions contemplated hereby or the process leading thereto, including with respect to any amendment, waiver or other modification hereof or of any other Loan Document (irrespective of whether any of the Agents or any Lender has advised or is currently advising any Loan Party or any of its Affiliates on other matters) and none of the Agents or any Lender has any obligation to any Loan Party or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; (iv) the Agents, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Loan Parties and their respective Affiliates, and none of the Agents or any Lender has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (v) neither the Agents nor any Lender has provided or will provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including any amendment, waiver or other modification hereof or of any other Loan Document) and each of the Loan Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate.  Each of the Loan Parties hereby waives and releases, to the fullest extent permitted by law, any claims that it may have against each of the Agents or any Lender with respect to any breach or alleged breach of agency or fiduciary duty.
 
9.22   Additional Borrowers .
 
Upon the written request of the Lead Borrower to the Administrative Agent, any Domestic Subsidiary may become a Borrower hereunder (whether or not such Domestic Subsidiary is required to become a party hereto pursuant to Section 5.14 hereof) upon the delivery to the Administrative Agent of a joinder to this Agreement, joinders to other Loan Documents, as applicable, opinions of counsel, certificates and such other documentation as the Administrative Agent shall reasonably request, and the taking of such actions to create and perfect Liens on such Domestic Subsidiary’s assets that would otherwise constitute Collateral to secure the Obligations as the Administrative Agent shall reasonably request.

9.23   Existing Credit Agreement Amended and Restated .  This Agreement shall amend and restate the Existing Credit Agreement in its entirety, with the parties hereby agreeing that there is no novation of the Existing Credit Agreement.  On the Closing Date, the rights and obligations of the parties under the Existing Credit Agreement shall be subsumed within and be governed by this Agreement; provided, however, that each of the “Loans” (as such term is defined in the Existing Credit Agreement) outstanding under the Existing Credit Agreement on the Closing Date shall, for purposes of this Agreement, be included as Loans hereunder and each of the “Letters of Credit” and “Acceptances” (as defined in the Existing Credit Agreement) outstanding under the Existing Credit Agreement on the Closing Date shall be Letters of Credit and Acceptances hereunder.
 

[balance of page left intentionally blank; signature pages follow]


 
 
 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as a sealed instrument as of the day and year first above written.

BROWN SHOE COMPANY, INC.
SIDNEY RICH ASSOCIATES, INC.
BROWN GROUP RETAIL, INC.
BROWN SHOE INTERNATIONAL CORP.
BUSTER BROWN & CO.
BENNETT FOOTWEAR GROUP LLC
SHOES.COM, INC.
as to each of the foregoing


By:            /s/ Mark E. Hood
Name:                      Mark E. Hood
 
Title:
Senior Vice President and
Chief Financial Officer


BROWN SHOE COMPANY OF CANADA LTD

By:            /s/ Mark E. Hood
Name:                      Mark E. Hood
 
Title:
Senior Vice President – Finance



 
 
 



BANK OF AMERICA, N.A.,
as Administrative Agent, as Collateral Agent, as Lead Issuing Bank and as Lender


By:            /s/ Christine Hutchinson
Name:                      Christine Hutchinson
Title:                      Principal

Address:

100 Federal Street, 9th Floor
Boston, Massachusetts 02110
Attn: Mr. Keith Vercauteren
Telephone: (617) 434-4045
Telecopy: (617) 434-4339



 
 
 


JPMORGAN CHASE BANK, N.A.,
as a Lender


By:            /s/ Scott Troy
Name:                      Scott Troy
Title:                      Vice President

Address:

JPMorgan Chase Bank, N.A.
270 Park Avenue, 44 th Floor
New York, New York 10017
Attention:  Scott Troy, Account Executive
Telephone:  (212) 270-0372
Facsimile:  (646) 534-2274


 
 
 

WELLS FARGO RETAIL FINANCE, LLC,
as a Lender


By:            /s/ Connie Liu
Name:                      Connie Liu
Title:                      Assistant Vice President

Address:

Wells Fargo Retail Finance, LLC
One Boston Place, 18 th Floor
Boston, Massachusetts 02108
Attention:  Connie Liu, Vice President
Telephone:  (617) 854-7232
Facsimile:  (866) 303-3944

 
 
 

SUNTRUST BANK,
as a Lender


By:            /s/ Patrick Wiggins
Name:                      Patrick Wiggins
Title:                      Vice President

Address:

SunTrust Bank
303 Peachtree Street
Atlanta, Georgia 30308
Attention:  Patrick Wiggins, Vice President
Telephone:  (404) 658-4931
Facsimile:  (404) 813-5890

 
 
 

REGIONS BANK,
as a Lender


By:            /s/ Christine M. Ferrise
Name:                      Christine M. Ferrise
Title:                      Attorney-in-Fact/SVP

Address:

Regions Bank
599 Lexington Avenue, 45 th Floor
New York, New York 10022
Attention:  Kevin Rogers, Vice President
Telephone:  (212) 935-2237
Facsimile:  (212) 935-7458

 
 
 

CAPITAL ONE LEVERAGE FINANCE CORP.,
as a Lender


By:            /s/ Nick Malatestinic
Name:                      Nick Malatestinic
Title:                      SVP

Address:

Capital One Leverage Finance Corp.
265 Broadhollow Road, 4 th Floor
Melville, New York 11747
 
Attention:  Nick Malatestinic, SVP – Credit Manager
Telephone:  (631) 531-2131
Facsimile:  (631) 531-2765


 
 
 

EXHIBIT A
 
ASSIGNMENT AND ACCEPTANCE
 
This Assignment and Acceptance (this “ Assignment and Acceptance ”) is dated as of the Effective Date set forth below and is entered into by and between [the][each]1 Assignor identified in item 1 below ([the][each, an] “ Assignor ”) and [the][each]2 Assignee identified in item 2 below ([the][each, an] “ Assignee ”).  [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees]3 hereunder are several and not joint.]4  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (the “ Credit Agreement ”), receipt of a copy of which is hereby acknowledged by [each, the] Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Acceptance as if set forth herein in full.
For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the respective Assignors] under the respective facilities identified below (including, without limitation, participations in Letters of Credit and Swingline Loans included in such facilities5) and (ii) to the extent permitted to be assigned under Applicable Law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as [the][an] “ Assigned Interest ”).  Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Acceptance, without representation or warranty by [the][any] Assignor.
 
 1.   Assignor[s] :
 
_____________________________
 
______________________________  
 
 
2.
Assignee[s] :
______________________________

 
______________________________

3.
Borrowers :
Brown Shoe Company, Inc., a New York corporation (the “ Lead Borrower ”), Sidney Rich Associates, Inc., a Missouri corporation, Brown Group Retail, Inc., a Pennsylvania corporation, Brown Shoe International Corp. (f/k/a Brown Shoe International, LLC), a Delaware corporation, Buster Brown & Co., a Missouri corporation, Bennett Footwear Group LLC, a Delaware limited liability company, and Shoes.com, Inc., a Delaware corporation

4.
Administrative Agent : Bank of America, N.A., as the Administrative Agent under the Credit Agreement.

5.
Credit Agreement :
Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as such may be amended, modified, supplemented or restated hereafter, the  “ Credit Agreement ”) by, among others, the Lead Borrower and the other Borrowers, Brown Shoe Company of Canada Ltd, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders (in such capacity, the “ Agent ”), and Bank of America, N.A., as Lead Issuing Bank.

6.
Assigned Interest[s] :
 
 
 
Assignor[s]6
 
 
 
Assignee[s]7
Aggregate
Amount of
Commitment/Loans
for all Lenders8
Amount of
Commitment/Loans
Assigned9
Percentage
Assigned of
Commitment/
Loans10
   
$____________
$______
_________%
   
$____________
$______
_________%
 
[7.            Trade Date :                                __________________]11
 

 
Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE DATE OF DELIVERY OF THIS
 
ASSIGNMENT AND ACCEPTANCE FOR RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]
The terms set forth in this Assignment and Acceptance are hereby agreed to:

ASSIGNOR
[NAME OF ASSIGNOR]

By:           _____________________________
Name:                      _____________________________
Title:                      _____________________________



ASSIGNEE
[NAME OF ASSIGNEE]

By:           _____________________________
Name:                      _____________________________
Title:                      _____________________________

[Consented to and]12 Accepted:

BANK OF AMERICA, N.A., as
[Administrative Agent][Lead Issuing Bank]

By:           _____________________________
Name:                                                                                     _____________________________
Title:                                                                                     _____________________________


[Consented to:]13

BROWN SHOE COMPANY, INC., as Lead Borrower

By:           _____________________________
Name:                                                                                     _____________________________
Title:                      _____________________________


[Consented to:]14

[_____________], as an Issuing Bank

By:           _____________________________
Name:                                                                                     _____________________________
Title:                      _____________________________


 
1 For bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor, choose the first bracketed language.  If the assignment is from multiple Assignors, choose the second bracketed language.
 
2   For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee, choose the first bracketed language.  If the assignment is to multiple Assignees, choose the second bracketed language.
 
3   Select as appropriate.
 
4   Include bracketed language if there are either multiple Assignors or multiple Assignees.
 
5 Include all applicable subfacilities, if any.
 
6 List each Assignor, as appropriate.
 
7 List each Assignee, as appropriate.
 
8   Amounts in this column and in the column immediately to the right to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and the Effective Date.
 
9 Subject to minimum amount requirements and the proportionate amount requirements pursuant to Section 9.5(b) of the Credit Agreement.
 
10 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.
 
11 To be completed if the Assignor and the Assignee intend that the minimum assignment amount is to be determined as of the Trade Date.
 
12 To the extent that (i) the Administrative Agent’s consent is required under Section 9.5(b)(i) of the Credit Agreement, or (ii) the Lead Issuing Bank’s consent is required under Section 9.5(b)(i) of the Credit Agreement.
 
13 To the extent required under Sections 9.5(b)(i) of the Credit Agreement.
 
14 To the extent required under Sections 9.5(b)(i) of the Credit Agreement.

 
 
 

ANNEX 1 TO ASSIGNMENT AND ACCEPTANCE

Reference is made to the Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as such may be amended, modified, supplemented or restated hereafter, the  “ Credit Agreement ”) by, among others, the Brown Shoe Company, Inc., a New York corporation (the “ Lead Borrower ”), the Borrowers from time to time party thereto, Brown Shoe Company of Canada Ltd, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders (in such capacity, the “ Agent ”), and Bank of America, N.A., as Lead Issuing Bank.

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ACCEPTANCE

1.          Representations and Warranties .

1.1.               Assignor .  [The][Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][[the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Loan Parties or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Loan Parties or any other Person of any of their respective obligations under any Loan Document.

1.2.               Assignee .  [The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Acceptance and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an Eligible Assignee under the Credit Agreement (subject to such consents, if any, as may be required under Section 9.5(b)(i) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the][such] Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 5.1 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase [the][such] Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent, Collateral Agent, or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Acceptance and to purchase [the][such] Assigned Interest, and (vii) if it is a Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by [the][such] Assignee; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, the Collateral Agent, [the][any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

2.          Payments .  From and after the Effective Date, the Administrative Agent shall make all payments in respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued up to but excluding the Effective Date and to [the][the relevant] Assignee for amounts which have accrued from and after the Effective Date.

3.          General Provisions .  This Assignment and Acceptance shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Acceptance may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Acceptance by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Acceptance.  This agreement shall be governed by, and construed in accordance with, the law of the State of New York (without regard to its principles relating to choice and conflicts of law), but including Section 5-1401 of the New York General Obligations law.

4.          Fees .    This Assignment and Acceptance shall be delivered to the Administrative Agent with a processing and recordation fee of $5,000.


 
 
 

Exhibit B

Form of Revolving Note



SECOND AMENDED AND RESTATED REVOLVING NOTE



$_______________ _________, 2009

FOR VALUE RECEIVED, Brown Shoe Company, Inc., a New York corporation having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (the “ Lead Borrower ”) and each of Sidney Rich Associates, Inc., a Missouri corporation, Brown Group Retail, Inc., a Pennsylvania corporation, Brown Shoe International Corp. (f/k/a Brown Shoe International, LLC), a Delaware corporation, Buster Brown & Co., a Missouri corporation, Bennett Footwear Group LLC, a Delaware limited liability company, and Shoes.com, Inc., a Delaware corporation, each having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (hereinafter, together with the Lead Borrower, singly, a “ Borrower ”, and collectively, the “ Borrowers ”, together with successors and assigns), jointly and severally promise to pay to the order of _____________________________ (hereinafter, together with its successors in title and assigns, the “ Lender ”), c/o Bank of America, N.A., 100 Federal Street, Boston, Massachusetts 02110, the principal sum of ______________________ ($______________), or, if less, the aggregate unpaid principal balance of Revolving Loans made by the Lender to or for the account of any Borrower on the Termination Date pursuant to the Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as such may be amended, modified, supplemented or restated hereafter, the “ Credit Agreement ”) by, among others, (i) the Borrowers, (ii) the Lenders from time to time party thereto, (iii) Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders (in such capacity, the “ Agent ”), and as Swingline Lender, and (iv) Bank of America, N.A., as Lead Issuing Bank, with interest, fees, expenses, and costs at the rate and payable in the manner stated therein.

This is a “Revolving Note” to which reference is made in the Credit Agreement and is subject to all terms and provisions thereof.  The principal of, and interest on, this Revolving Note shall be payable at the times, in the manner, and in the amounts as provided in the Credit Agreement and shall be subject to prepayment and acceleration as provided therein.  [This Revolving Note replaces in its entirety that certain Amended and Restated Revolving Note dated as of July 21, 2004 by, among others, certain of the Borrowers, in favor of the Lender.]  Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

The Agent’s books and records concerning the Revolving Loans, the accrual of interest thereon, and the repayment of such Revolving Loans, shall be prima facie evidence of the indebtedness hereunder, absent manifest error.

No delay or omission by the Agent or the Lender in exercising or enforcing any of Agent’s or such Lender’s powers, rights, privileges, remedies, or discretions hereunder shall operate as a waiver thereof on that occasion nor on any other occasion.  No waiver of any Event of Default shall operate as a waiver of any other Event of Default, nor as a continuing waiver.

Each Borrower, and each endorser and guarantor of this Revolving Note, waives presentment, demand, notice, and protest, except for notices expressly provided for in the Credit Agreement or any other Loan Document, and also waives any delay on the part of the holder hereof.  Each Borrower assents to any extension or other indulgence (including, without limitation, the release or substitution of Collateral) permitted by any Agent and/or the Lender with respect to this Revolving Note and/or any Collateral or any extension or other indulgence with respect to any other liability or any collateral given to secure any other liability of any Borrower or any other Person obligated on account of this Revolving Note.

This Revolving Note shall be binding upon each Borrower, and each endorser and guarantor hereof, and upon their respective successors, assigns, and representatives, and shall inure to the benefit of the Lender and its successors, endorsees, and assigns.

The liabilities of each Borrower, and of any endorser or guarantor of this Revolving Note, are joint and several, provided, however , the release by Agent or the Lender of any one or more such Persons shall not release any other Person obligated on account of this Revolving Note.  Each reference in this Revolving Note to each Borrower, any endorser, and any guarantor, is to such Person individually and also to all such Persons jointly.  No Person obligated on account of this Revolving Note may seek contribution from any other Person also obligated unless and until all liabilities, obligations and indebtedness to the Lender of the Person from whom contribution is sought have been satisfied in full.

Each Borrower agrees that any suit for the enforcement of this Revolving Note or any other Loan Document may be brought in any New York state or federal court sitting in the Borough of Manhattan as the Lender may elect in its sole discretion and consent to the non-exclusive jurisdiction of such courts.  Each Borrower hereby waives any objection which they may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum.  Each Borrower agrees that any action commenced by any Borrower asserting any claim or counterclaim arising under or in connection with this Revolving Note or any other Loan Document shall be brought solely in any New York state or federal court sitting in the Borough of Manhattan as the Lender may elect in its sole discretion and consent to the non-exclusive jurisdiction of such courts.

THIS REVOLVING NOTE IS DELIVERED TO THE LENDER AT THE OFFICES OF THE AGENT IN BOSTON, MASSACHUSETTS, AND SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO ITS PRINCIPLES RELATING TO CHOICE AND CONFLICTS OF LAW), BUT INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

Each Borrower makes the following waiver knowingly, voluntarily, and intentionally, and understands that the Agent and the Lender, in the establishment and maintenance of their respective relationship with the Borrowers contemplated by this Revolving Note, is relying thereon. EACH BORROWER, EACH GUARANTOR, ENDORSER AND SURETY, AND THE LENDER BY ITS ACCEPTANCE HEREOF, HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS REVOLVING NOTE, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTA­TIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THE CREDIT AGREE­MENT AND THIS REVOLVING NOTE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS HEREIN.



[Signature Page Follows]


 
 
 

IN WITNESS WHEREOF, the Borrowers have caused this Revolving Note to be duly executed as of the date set forth above.


BORROWERS:

BROWN SHOE COMPANY, INC.
SIDNEY RICH ASSOCIATES, INC.
BROWN GROUP RETAIL, INC.
BUSTER BROWN & CO.
BROWN SHOE INTERNATIONAL CORP.
BENNETT FOOTWEAR GROUP LLC
SHOES.COM, INC.
as to each of the foregoing


By:           _________________________
Name:                      Mark E. Hood
Title:                      Senior Vice President and
Chief Financial Officer









 
 
 

Exhibit C

PERFECTION CERTIFICATE


Reference is made to the Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as such may be amended, modified, supplemented or restated hereafter, the “ Credit Agreement ”) by, among others, (i) Brown Shoe Company, Inc., a New York corporation (the “ Lead Borrower ”), (ii) the other Borrowers from time to time party thereto, (iii) Brown Shoe Company of Canada Ltd (“ Brown Canada ”), as a Loan Party, (iv) the Lenders from time to time party thereto, and (v) Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders, and as Lead Issuing Bank.
 
Reference is also made to a certain Amended and Restated Security Agreement dated as of July 21, 2004 (as such may be amended, modified, supplemented or restated hereafter, the “ Security Agreement ”) by and among the Grantors (as defined in the Security Agreement) and Bank of America, N.A., as collateral agent (in such capacity herein, the “ Collateral Agent ”) for the Secured Parties (as defined in the Security Agreement).  Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement or the Security Agreement (as applicable).
 
The under­signed, the __________________of each Grantor, hereby certifies to the Collateral Agent and each other Secured Party as follows:
 
10.   Names and Identifying Information .
 
10.1   The exact legal name of each Grantor as it appears in its certificate of incorporation or other equivalent formation document, as amended to date, is as follows:
 

10.2   The following is the type of organization of each Grantor:
 
Grantor
Type of Organization
   


10.3   The jurisdiction of organization of each Grantor is as follows:
 

Grantor
Jurisdiction of Organization
   

10.4   The following is each Grantor’s state issued organizational identification number:
 
Grantor
Organizational Identification Number
   


10.5   The following is each Grantor’s federal taxpayer identification number:
 
Grantor
Federal Taxpayer Identification Number
   

 
10.6   The following is a list of jurisdictions in which each Grantor is authorized to do business other than those jurisdictions where a Loan Party is terminating its qualifications as set forth on Schedule 4.1(c) of the Credit Agreement (and, with respect to Brown Canada only, provinces in which Collateral is located):
 
Grantor
Jurisdictions/Provinces
   

 

 
11.   ­ Current Locations .
 

11.1   The following is the mailing address for each Grantor:
 
Grantor
Mailing Address (include street address, city, state, zip code)
   




11.2   The following are the names and addresses of all persons or entities other than any Grantor (such as customs brokers, bailees, consignees or warehousemen) which have possession or are intended to have possession of any of the Collateral (other than in-transit inventory) and the nature of such party’s possession (such as customs broker, bailee, consignee, warehouseman, or other):
 
Grantor
Name
Mailing Address
City
State
Nature of Possession
           

 
12.   No Unusual Transactions .  Except for those purchases, acquisitions, and other transactions set forth below, all of the Collateral has been originated by the Grantors in the ordinary course of each Grantor’s business or consists of Goods which have been acquired by the Grantors in the ordinary course from a Person in the business of selling Goods of that kind:
 
The undersigned hereby acknowledges and agrees that the Collateral Agent and each other Secured Party is relying on the representations and warranties made herein in connection with the Credit Agreement.
 

 
[signature page follows]
 

 
 
 

IN WITNESS WHEREOF, the undersigned has duly executed this Perfection Certificate.
 

LEAD BORROWER:

BROWN SHOE COMPANY, INC.



 
By:
_________________________________
Name:                      Mark E. Hood
Title:                      Senior Vice President and
Chief Financial Officer









 
 
 
EXHIBIT D

BANK OF AMERICA, NATIONAL ASSOCIATION
                       
CONSOLIDATED CERTIFICATE  #
   
DATE:
                   
                                 
                             
BABC USE ONLY
ACCOUNTS RECEIVABLE (DETAIL SHOWN ON ATTACHED SCHEDULE 1 )
                 
 1.  BEGINNING BALANCE LINE 6 LAST REPORT
                       
 2.  PLUS:  SALES AS OF
                           
 3.  LESS:  CREDITS AS OF
                           
 4.  LESS:  GROSS COLLECTIONS
                         
 5.  +/- ADJUSTMENTS
       
                        -
                 
 6.  ENDING BALANCE
                           
 7.  - INELIGIBLE
                             
 8.  NET AMOUNT OF ELIGIBLE ACCOUNTS
   
 ADVANCE RATE
85%
 
                        -
         
CREDIT CARD ACCOUNTS RECEIVABLE (DETAIL SHOWN ON ATTACHED SCHEDULE 2 )
             
9. CREDIT CARD A/R
                           
10. LESS: INELIGIBLES
                           
11. NET AMOUNT OF ELIGIBLE CREDIT CARD A/R
                        -
 
 ADVANCE RATE
90%
 
                        -
         
PERPETUAL INVENTORY (DETAIL SHOWN ON ATTACHED SCHEDULE 3 )
                 
12. INVENTORY AVAILABILITY BASED ON APPRAISED VALUE
                     
13. INVENTORY COMPONENT OF BORROWING BASE (LINE 12)
                   
AVAILABILITY RESERVES (DETAIL SHOWN ON ATTACHED SCHEDULE 4)
                 
14.  LESS: AVAILABILITY RESERVES
                         
15.  BORROWING BASE (LINE 8 + LINE 11 + LINE 13 + LINE 14)
             
                                      -
     
CREDIT EXTENSIONS
                           
16.  OUTSTANDING LOAN BALANCE AS OF
                       
17.  MERCHANDISE L/C's as of:
                         
18.  STANDBY L/C's as of:
                           
19.  BANKERS' ACCEPTANCES
             
                        -
         
20.  TOTAL CREDIT EXTENSIONS
                 
                                      -
     
                                 
EXCESS AVAILABILITY
                           
21.  TOTAL COMMITMENTS (PER SCHEDULE 1.1 OF THE AGREEMENT)
       
     380,000,000
         
22.  BORROWING BASE (LINE 15)
             
                        -
         
23.  LESSER OF TOTAL COMMITMENTS OR BORROWING BASE (LESSER OF LINE 21 OR LINE 22)
 
                                      -
     
24.  LESS: TOTAL CREDIT EXTENSIONS (LINE 20)
               
                                      -
     
25.  EXCESS AVAILABILITY
                   
 $                  -
     
                                 
                                 
THE UNDERSIGNED REPRESENTS AND WARRANTS THAT THE INFORMATION SET FORTH ABOVE AND ON THE ATTACHED SCHEDULES IS TRUE AND COMPLETE IN ALL MATERIAL RESPECTS.  THE UNDERSIGNED GRANTS A SECURITY INTEREST IN THE COLLATERAL REFLECTED ABOVE TO BANK OF AMERICA, NATIONAL ASSOCIATION, AS AGENT FOR THE LENDERS, AND REPRESENTS AND WARRANTS THAT SAID COLLATERAL COMPLIES IN ALL MATERIAL RESPECTS WITH THE REPRESENTATIONS, WARRANTIES AND COVENANTS CONTAINED IN THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHERS BROWN SHOE COMPANY, INC., CERTAIN OF ITS SUBSIDIARIES, BANK OF AMERICA, NATIONAL ASSOCIATION, AS AGENT, AND THE OTHER LENDERS PARTY THERETO.
                                 
BROWN SHOE COMPANY, INC.,
                         
AS A BORROWER AND AS AGENT FOR THE BORROWERS:
                     
                                 
                                 
AUTHORIZED SIGNATURE:
                           
                                 
                                TITLE:
                           
                                 
                                 
                                 
                                 
                                 
                                 
                                 

 
 
 


EXHIBIT E

FORM OF COMPLIANCE CERTIFICATE

To:           Bank of America, N.A.                                                                           Date:                      _____________________
100 Federal Street
Boston, Massachusetts 02110
Attention: Mr. Keith Vercauteren

Re:           Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as amended, amended and restated, modified, supplemented or renewed from time to time the “ Credit Agreement ”) by, among others, BROWN SHOE COMPANY, INC. (the “ Lead Borrower ”), SIDNEY RICH ASSOCIATES, INC., BROWN GROUP RETAIL, INC., BROWN SHOE INTERNATIONAL CORP., BUSTER BROWN & CO., BENNETT FOOTWEAR GROUP LLC, and SHOES.COM, INC. (together with the Lead Borrower, the “ Borrowers ”), BROWN SHOE COMPANY OF CANADA LTD, as a Loan Party, the Lenders from time to time party thereto, and Bank of America, N.A., as administrative agent and collateral agent for the Lenders (in such capacities, the “ Agent ”) and as Lead Issuing Bank.  Capitalized terms used herein but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement.
 
The undersigned, a duly authorized and acting Financial Officer of the Lead Borrower, hereby certifies to you as follows:
 
13.   No Defaults .  No Default presently exists, except as set forth in Appendix I .
 
14.   Financial Calculations .  Attached hereto as Appendix II are all relevant reasonably detailed calculations for the Fixed Charge Coverage Ratio for the period ending ________.
 
15.   No Material Accounting Changes, Etc .  The financial statements furnished to the Agent for the quarter/year ending _____________ were prepared in accordance with GAAP consistently applied and present fairly in all material respects the financial condition of the Lead Borrower and its Subsidiaries at the close of, and the results of the Borrowers’ operations for, the period(s) covered, subject to, with respect to the quarterly financial statements, normal year end audit adjustments and the absence of footnotes. There has been no change in GAAP or the application thereof since the date of the audited financial statements furnished to the Agent for the Fiscal Year ending February 2, 2008, other than the material accounting changes as disclosed on Appendix III hereto.
 
16.   Schedules .  There has been no change to the information disclosed in any of Schedules 3.1 through 3.24 to the Credit Agreement, or any of the schedules to the Perfection Certificate or any other Loan Document (or after the delivery of the first Compliance Certificate delivered pursuant to Section 5.1(d) of the Credit Agreement, as previously certified), other than the changes as disclosed on Appendix IV hereto; provided that, notwithstanding the foregoing, no such revisions or updates shall be deemed to have amended, modified, or superseded any such schedules as originally attached to the Credit Agreement (or after the delivery of the first Compliance Certificate delivered pursuant to Section 5.1(d) of the Credit Agreement, as previously certified), or to have cured any breach of warranty or representation resulting from the inaccuracy or incompleteness of any such schedules, unless and until the Administrative Agent shall have accepted in writing such revisions or updates to any such schedules; and provided further that the Administrative Agent shall be deemed to have accepted such revisions or updates unless the Administrative Agent delivers a written objection thereto to the Lead Borrower within thirty (30) days after the date such revisions or updates have been received.
 
[signature page follows]
 

 
IN WITNESS WHEREOF, I have executed this Certificate this _____ day of __________, ____.

      By:                      ____________________________________
Financial Officer of Lead Borrower

Name:______________________________
Title:_______________________________


 
 
 

APPENDIX I

Except as set forth below, no Default presently exists. [If a Default exists, the following describes the nature of the Default in reasonable detail and the steps, if any, being taken or contemplated by the Loan Parties to be taken on account thereof]
 


 
 
 

Appendix II

Fixed Charge Coverage Ratio for the Fiscal Quarter ending
_________________ (calculated for preceding four Fiscal Quarters
 then ended):                                                                                                                                ____________

1.           Consolidated EBITDA for the preceding four Fiscal Quarters then ended (in the case of clauses (a), (b), (c) and (d) below, determined on a Consolidated basis):

(a)           Adjusted Net Earnings from Operations for such period:____________

Plus

(b)           depreciation, amortization and all other non-cash charges that
were deducted in the calculation of Adjusted Net Earnings from
Operations for such period:                                                                                                                     ____________

Plus

(c)           federal, state, local and foreign  income taxes that were deducted
in the calculation of Adjusted Net Earnings from Operations for
such period:                                                                                                           ____________

Plus

(d)           Consolidated Interest Expense to the extent deducted in the
calculation of Adjusted Net Earnings from Operations for such
period:                                                                                                           ____________

2.           Consolidated EBITDA for the preceding four Fiscal Quarters then ended
[the sum of Line 1(a) through Line 1(d)]:                                                                                                                                ____________

3.           Fixed Charges for the preceding four Fiscal Quarters then ended (in the case of clauses (a), (b), (c), (d) and (e) below, determined on a Consolidated basis):

(a)           Consolidated Interest Expense during such period:____________

Plus

(b)           Capital Expenditures (excluding Capital Expenditures funded
with Indebtedness other than Revolving Loans) during such period:____________

Plus

(c)           scheduled principal payments of Indebtedness payable over the
course of the preceding four (4) Fiscal Quarters:                                                                                                                     ____________

Plus

(d)           federal, state, local, and foreign income taxes net of refunds
received, to the extent any such taxes are paid in cash during such
period (excluding taxes paid to repatriate foreign earnings for fiscal
periods which are more than twelve months prior to the date of
determination of Fixed Charges for any period):                                                                                                                     ____________

Plus

(e)           Restricted Payments during such period, excluding any Restricted
Payments (x) consisting of dividends or distributions made in
Capital Stock under clause (a) of the definition thereof and (y)
permitted under Section 6.7(a)(iii) of the Credit Agreement:____________


4.           Fixed Charges for the preceding four Fiscal Quarters then ended
[the sum of Line 3(a) through Line 3(e)]:                                                                                                                                ____________

5.           Fixed Charge Coverage Ratio as of the Fiscal Quarter ending
_________________ (calculated for preceding four Fiscal
Quarters then ended) [Line 2 divided by Line 4]:____________


Covenant:    If Excess Availability is less than the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 at any time, the Loan Parties shall maintain a Fixed Charge Coverage Ratio, calculated on a trailing four Fiscal Quarters basis of not less than 1.0:1.0.  Such Fixed Charge Coverage Ratio shall be first tested monthly as of the month ending immediately prior to the date that Excess Availability is first less than the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 and shall continue to be tested until Excess Availability has exceeded the greater of (i) seventeen and one-half (17.5%) percent of the lesser of the then (x) Total Commitments or (y) Borrowing Base and (ii) $25,000,000 on each day for two consecutive Fiscal Quarters.


Is covenant required to be tested?                                                                                                Yes _________                                           No _________


If covenant is required to be tested, in compliance?                                                                    Yes _________               No _________





 
 
 

APPENDIX III

Except as set forth below, no material changes in GAAP or the application thereof have occurred since the Fiscal Year ending February 2, 2008. [If material changes in GAAP or in application thereof have occurred, the following describes the nature of the changes in reasonable detail and the effect, if any, of each such material change in GAAP or in application thereof on the financial statements delivered in accordance with the Credit Agreement].
 

 
 
 

APPENDIX IV

Except as set forth below, there has been no change to the information disclosed in any of Schedules 3.1 through 3.24 to the Credit Agreement, or any of the schedules to the Perfection Certificate or any other Loan Document (or after the delivery of the first Compliance Certificate delivered pursuant to Section 5.1(d) of the Credit Agreement, as previously certified); provided that, notwithstanding the foregoing, no such revisions or updates shall be deemed to have amended, modified, or superseded any such schedules as originally attached to the Credit Agreement (or after the delivery of the first Compliance Certificate delivered pursuant to Section 5.1(d) of the Credit Agreement, as previously certified), or to have cured any breach of warranty or representation resulting from the inaccuracy or incompleteness of any such schedules, unless and until the Administrative Agent shall have accepted in writing such revisions or updates to any such schedules; and provided further that the Administrative Agent shall be deemed to have accepted such revisions or updates unless the Administrative Agent delivers a written objection thereto to the Lead Borrower within thirty (30) days after the date such revisions or updates have been received.
 

 


 
 
 

EXHIBIT F
 
NOTICE OF BORROWING
 

To:           Bank of America, N.A.                                                                           Date:                      _____________________
100 Federal Street
Boston, Massachusetts 02110
Attention: Mr. Keith Vercauteren
 
Re:           Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as amended, amended and restated, modified, supplemented or renewed from time to time, the “ Credit Agreement ”) by, among others, BROWN SHOE COMPANY, INC. (the “ Lead Borrower ”), SIDNEY RICH ASSOCIATES, INC., BROWN GROUP RETAIL, INC., BROWN SHOE INTERNATIONAL CORP., BUSTER BROWN & CO., BENNETT FOOTWEAR GROUP LLC, and SHOES.COM, INC. (together with the Lead Borrower, the “ Borrowers ”), BROWN SHOE COMPANY OF CANADA LTD, as a Loan Party, the Lenders from time to time party thereto, and Bank of America, N.A., as administrative agent and collateral agent for the Lenders (in such capacities, the “ Agent ”) and as Lead Issuing Bank.
 
Ladies and Gentlemen:
 
Reference is made to the above described Credit Agreement.  All capitalized terms used but not defined herein shall have the meanings set forth in the Credit Agreement.  The Lead Borrower, as agent for itself and the other Borrowers pursuant to Section 9.4 of the Credit Agreement, hereby irrevocably notifies you of the Borrowing specified below:
 
The Business Day of the proposed Borrowing(s) is/are __________________.
 
The aggregate amount of the proposed Borrowing(s) is $___________________, which Borrowing(s) shall consist of the following Types:
 
Type of Borrowing
(Prime Rate or LIBO)
Amount
Interest Period for LIBO Advances
 
$___________________
[months]     [days]
 
$___________________
[months]     [days]
 
$___________________
[months]     [days]
 
$___________________
[months]     [days]

 
The account to which the proceeds of such Borrowing are to be deposited, if notAccount No. 5045183372 maintained by the Borrowers with Bank of America,N.A., is as follows: ________________________________________.
 
The Lead Borrower hereby certifies that the following statements are true on the date hereof, and will be true on the date of the proposed Borrowing, before and after giving effect thereto and to the application of the proceeds thereof:
 
(a)           All representations and warranties made by the Borrowers in the Loan Documents are true and correct in all material respects on and as of the date hereof, except (i) that such representations and warranties (A) that relate solely to an earlier date are true and correct in all material respects as of such earlier date and (B) are true and correct in all respects if they are qualified by a materiality standard and (ii) to the extent that the Agent and the Lenders have been notified by the Borrowers that any representation or warranty is not correct and the Required Lenders have explicitly waived in writing compliance with such representation or warranty;
 
(b)           No event has occurred and is continuing, or would result from the proposed Borrowing, which constitutes or would constitute a Default or an Event of Default; and
 
(c)           After giving effect to the proposed Borrowing(s) set forth in Section 0 above, there will be no more than fifteen (15) Borrowings of LIBO Loans outstanding under the Credit Agreement.
 
This Notice of Borrowing is issued pursuant to and is subject to the Credit Agreement.
 
[Remainder of page intentionally left blank]
 

 
 
 

This Notice of Borrowing is duly executed as of the date set forth above.
 
LEAD BORROWER :
 
BROWN SHOE COMPANY, INC., asagent for itself and the other Borrowers
 
By:           _____________________________
Name: _______________________
Title: ________________________
1128759.1

 
 
 

Exhibit G

Form of Credit Card Notification

CREDIT CARD NOTIFICATION
PREPARE ON BORROWER LETTERHEAD - ONE FOR EACH PROCESSOR OF EACH LOAN PARTY




 _________________, 20__



To:
[Name and Address of Credit Card Processor]
(the " Processor ")

Re:           _______________________
Merchant Account Number: ____________________

Dear Sir/Madam:

_______________, a _______________ (the "[ Borrower/Guarantor ]"), has entered into various financing agreements with Bank of America, N.A., a national banking association with offices at 100 Federal Street, Boston, Massachusetts 02110, as collateral agent (in such capacity, herein the " Collateral Agent ") for the ratable benefit of a syndicate of lenders and certain other secured parties (the " Secured Parties "), pursuant to which agreements the [Borrower/Guarantor] has granted to the Collateral Agent (for the ratable benefit of the Collateral Agent and the other Secured Parties) a [hypothec on and a] security interest in and to, among other things, the [Borrower's/Guarantor’s] accounts, including, without limitation, all amounts due or to become due from the Processor to the [Borrower/Guarantor].
 
Under the terms and provisions of such financing agreements, the [Borrower/Guarantor] is, under certain circumstances, obligated to deliver all proceeds of the [Borrower's/Guarantor’s] accounts, accounts receivable, and inventory to the Collateral Agent.  Such proceeds include all credit card charges submitted by the [Borrower/Guarantor] to the Processor for processing and the amounts which the Processor owes to the [Borrower/Guarantor] on account thereof (the " Credit Card Proceeds ").
 
Until the Processor receives written notification from the Collateral Agent that a Dominion Period has commenced, the Processor may follow the [Borrower's/Guarantor’s] instructions with respect to the Credit Card Proceeds and other amounts due from the Processor to the [Borrower/Guarantor].  During any Dominion Period, all amounts as may become due from time to time from the Processor to the [Borrower/Guarantor] (including without limitation, Credit Card Proceeds, payments from any reserve account or the like, or other payments) shall be transferred only as follows:
 
16.1   By ACH, Depository Transfer Check, or Electronic Depository Transfer to:
 
___________________
ABA # ______________
For Credit to Bank of America, N.A.
(Brown Shoe Concentration Account)
Account No. ___________________
Re: ____________________

or

16.2   As the Processor may be otherwise instructed from time to time in writing by an officer of the Collateral Agent.
 
The “Dominion Period” means each period which commences upon receipt by the Processor of written notice from the Collateral Agent in the form of Attachment I and which terminates upon receipt by the Process of written notice from the Collateral Agent in the form of Attachment II.
 
Upon request of the Collateral Agent, a copy of each periodic statement issued by the Processor to the [Borrower/Guarantor] should be provided to the Collateral Agent at the following address (which address may be changed upon seven (7) days’ written notice given to the Processor by the Collateral Agent):
 
Bank of America, N.A.
100 Federal Street
Boston, Massachusetts 02110
Attention: Mr. Keith Vercauteren
Re: Brown Shoe Company, Inc.

The Processor shall be fully protected in acting on any order or direction by the Collateral Agent respecting the Credit Card Proceeds and other amounts without making any inquiry whatsoever as to the Collateral Agent's right or authority to give such order or direction or as to the application of any payment made pursuant thereto.
 
This letter may be amended only by the written agreement of the Processor, the [Borrower/Guarantor], and an officer of the Collateral Agent and may be terminated solely by written notice signed by an officer of the Collateral Agent. The [Borrower/Guarantor] shall not have any right to terminate this letter nor, except as provided in this Agreement, amend it.
 
Very truly yours,

____________________________

By: ______________________________
 
Name:
___________________________
 
Title:
___________________________


cc:           Bank of America, N.A.

 
 
 

Attachment I

To:           __________________
__________________
__________________

Re:           __________________
Merchant Account Number  _______________

Ladies and Gentlemen:

Reference is made to the Credit Card Notification dated as of _____________ by ___________ to you regarding the above described merchant account.  In accordance with the Credit Card Notification, we hereby give you notice that a Dominion Period is in effect and of our exercise of control of the Credit Card Proceeds and other payments due from you to ____________.  We hereby instruct you to transfer funds as provided in the Credit Card Notification or otherwise in accordance with our instructions.

Very truly yours,

BANK OF AMERICA, N.A.

________________________
Name:___________________
Title:____________________


 
 
 

Attachment II

To:           __________________
__________________
__________________

Re:           __________________
Merchant Account Number  _______________

Ladies and Gentlemen:

Reference is made to the Credit Card Notification dated as of _____________ by ___________ to you regarding the above described merchant account and the notice, dated __________, we delivered to you pursuant thereto.  In accordance with the Credit Card Notification, we hereby give you notice that the Dominion Period we declared pursuant to such notice is terminated and ___________ is entitled to exercise control of the Credit Card Proceeds and other payments due from you to ____________.  We hereby instruct you to cease transferring funds as provided in the Credit Card Notification.

Very truly yours,

BANK OF AMERICA, N.A.

________________________
Name:___________________
Title:____________________
 

 
 
 

 
SCHEDULES
 
to the
 
SECOND AMENDED AND RESTATED CREDIT AGREEMENT,
 
dated as of January 21, 2009, among
 
BROWN SHOE COMPANY, INC.,
 
as Lead Borrower for:
 
BROWN SHOE COMPANY, INC., SIDNEY RICH ASSOCIATES, INC., BROWN GROUP RETAIL, INC., BROWN SHOE INTERNATIONAL CORP., BUSTER BROWN & CO., BENNETT FOOTWEAR GROUP LLC and SHOES.COM, INC.
as Borrowers

BROWN SHOE COMPANY OF CANADA LTD,
 
as a Loan Party
 
The LENDERS Party Thereto,
 
BANK OF AMERICA, N.A., as Lead Issuing Bank,
 
BANK OF AMERICA, N.A.,
as Administrative Agent and Collateral Agent,

WELLS FARGO RETAIL FINANCE, LLC,
as Syndication Agent,

BANK OF AMERICA, N.A. and JPMORGAN CHASE BANK, N.A.
as co-Documentation Agent,

and

BANC OF AMERICA SECURITIES LLC and WELLS FARGO RETAIL FINANCE, LLC,
as Joint Lead Arrangers,

and

BANC OF AMERICA SECURITIES LLC, WELLS FARGO RETAIL FINANCE, LLC and JPMORGAN CHASE BANK, N.A.,
as Joint Lead Bookrunners


 
Any capitalized terms used herein, unless otherwise defined herein, shall have the meanings assigned to such terms in the Second Amended and Restated Credit Agreement.
 

 
 
 

INDEX OF SCHEDULES
 
Schedule
Description
Lenders and Commitments
Organization
Title to Properties; Real Estate
Disclosed Matters
ERISA
Subsidiaries; Capitalization
Insurance
Labor Matters
Affiliate Transactions
Intellectual Property.
Credit Card Arrangements, Blocked Account Agreements and Disbursement Accounts
Foreign Qualification Terminations
Financial Reporting Requirements
Indebtedness
Liens
Investments
Restrictive Agreements


 
 
 

BROWN SHOE COMPANY, INC.
 
SCHEDULE 1.1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
LENDERS AND COMMITMENTS
 
Lender
Commitment Amount
Bank of America, N.A.
$125,000,000.00
 
Wells Fargo Bank, National Association
$125,000,000.00
 
JPMorgan Chase Bank, N.A.
 
$50,000,000.00
 
Sun Trust Bank
 
$30,000,000.00
 
Capital One Leverage Finance Corp.
 
$25,000,000.00
 
Regions Bank
 
$25,000,000.00
 
Total:
$380,000,000.00
 


 
 
 

BROWN SHOE COMPANY, INC.
 
SCHEDULE 3.1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
ORGANIZATION
 

 
Legal Name
Jurisdiction of Organization
Organization Type
Organization Number
Federal Employer Identification Number
Brown Shoe Company, Inc.
New York
Corporation
N/A
43-0197190
Brown Shoe International Corp.
Delaware
Corporation
2065610
43-1375891
Brown Group Retail, Inc.
Pennsylvania
Corporation
655207
25-1323027
Buster Brown & Co.
Missouri
Corporation
00388452
43-1661024
Sidney Rich Associates, Inc.
Missouri
Corporation
00127326
43-0910619
Brown Shoe Company of Canada Ltd
Canada
Corporation
1151061
N/A
Bennett Footwear Group LLC
Delaware
Limited Liability Company
2959978
04-3437154
Shoes.com, Inc.
Delaware
Corporation
3130406
95-4781822

 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5 (b) TO  SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED
 
(As of January 1, 2009)
 
STORE #
TRADE/STORE NAME
MALL/SHOPPING CENTER
ADDRESS
CITY
STATE
ZIP/MAIL CODE
1746
FAMOUS FOOTWEAR
THE MALL AT SEARS
600 E. NORTHERN LIGHTS
ANCHORAGE
AK
99503
1784
FAMOUS FOOTWEAR
DIMOND CENTER
800 E. DIMOND  SUITE 106
ANCHORAGE
AK
99515
2098
FAMOUS FOOTWEAR
ANCHORAGE 5TH AVENUE MALL
320 WEST 5TH AVE.
ANCHORAGE
AK
99501
2543
FAMOUS FOOTWEAR
AURORA CENTER
415 MERHAR AVENUE
FAIRBANKS
AK
99701
2621
FAMOUS FOOTWEAR
GLENN SQUARE SHOPPING CENTER
3046 MOUNTAIN VIEW DRIVE SUITE 110
ANCHORAGE
AK
99501
1051
FAMOUS FOOTWEAR
WILDWOOD CENTRE
136 WILDWOOD PARKWAY
HOMEWOOD
AL
35209
1144
FAMOUS FOOTWEAR
RIVIERA CENTRE
2601 S. MCKENZIE STE R13
FOLEY
AL
36535
1600
FAMOUS FOOTWEAR
FASHION OUTLETS
201 ELIZABETH ST-STE 304
BOAZ
AL
35957
1731
FACTORY BRAND SHOES
WATERMARK PLACE
4665 VISIONLAND PARKWAY
BESSEMER
AL
35020
96621
NATURALIZER
TANGER OUTLET CENTER
2601 S. MCKENZIE STREET SUITE 450
FOLEY
AL
36535
329
FAMOUS FOOTWEAR
SCOTTSDALE PAVILIONS
8930 EAST INDIAN BEND RD
SCOTTSDALE
AZ
85256
343
FAMOUS FOOTWEAR
CHANDLER FESTIVAL
2600 WEST CHANDLER BLVD STE 12
CHANDLER
AZ
85224
351
FAMOUS FOOTWEAR
TUCSON ORACLE
555 E WETMORE
TUCSON
AZ
85704
370
FAMOUS FOOTWEAR
SUPERSTITION SPRINGS
6247 E. SOUTHERN AVE A1
MESA
AZ
85206
412
FAMOUS FOOTWEAR
WILMOT PLAZA
6371 EAST BROADWAY
TUCSON
AZ
85710
413
FAMOUS FOOTWEAR
THE COLONNADE MALL
1925 E. CAMLBCK RD STE130
PHOENIX
AZ
85016
671
FAMOUS FOOTWEAR
NORTH VALLEY CENTER
8085 W BELL RD SUITE 103
PEORIA
AZ
85382
952
FAMOUS FOOTWEAR
AHWATUKEE FOOTHILLS
4722 EAST RAY ROAD STE 20
PHOENIX
AZ
85044
1006
FAMOUS FOOTWEAR
MESA FIESTA
1339 SOUTH ALMA SCHOOL RD
MESA
AZ
85210

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
 
  STORE # TRADE/STORE NAME MALL/SHOPPING CENTER ADDRESS CITY STATE ZIP/MAIL CODE
1185
FAMOUS FOOTWEAR
ARCADIA CROSSING POWER
4501 E. THOMAS SUITE #139
PHOENIX
AZ
85018
1267
FAMOUS FOOTWEAR
SCOTTSDALE TOWN CENTER
15454 N FRANK LLOYD WRIGHT A-2
SCOTTSDALE
AZ
85260
1291
FAMOUS FOOTWEAR
PARADISE VALLEY MALL
4550 E. CACTUS RD  #406
PHOENIX
AZ
85032
1292
FAMOUS FOOTWEAR
ARROWHEAD TOWN CENTER
7700 ARRWHD TWN CTR #2259
GLENDALE
AZ
85308
1311
FAMOUS FOOTWEAR
DESERT SKY MALL
7611 W. THOMAS RD STE 103
PHOENIX
AZ
85075
1368
FAMOUS FOOTWEAR
PRIME OUTLETS @ NEW RIVER
4250 W HONDA BOW RD #640
PHOENIX
AZ
85027
1398
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
2050 S. ROSLYN PLACE #128
MESA
AZ
85208
1480
FAMOUS FOOTWEAR
ARIZONA MILLS
5000 ARIZONA MILLS CIRCLE
TEMPE
AZ
85282
1585
FAMOUS FOOTWEAR
PRIME OUTLETS @ SEDONA
6657 S. HWY 179-SUITE D-8
SEDONA
AZ
86351
1613
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
2300 E.TANGER DR.-STE 115
CASA GRANDE
AZ
85222
1615
FAMOUS FOOTWEAR
DEER VALLEY
2811 W. AGUA FRIA FRWY.
PHOENIX
AZ
85027
1710
FAMOUS FOOTWEAR
MESA SPECTRUM
1809 SOUTH STAPLEY DRIVE
MESA
AZ
85204
1766
FAMOUS FOOTWEAR
MALL AT SIERRA VISTA
2200 EL MERCADO LOOP
SIERRA VISTA
AZ
85635
2089
FAMOUS FOOTWEAR
DESERT RIDGE
21001 N. TATUM BLVD., STE. 62
PHOENIX
AZ
85050
2090
FAMOUS FOOTWEAR
SURPRISE TOWNE CENTRE
13768 W. BELL ROAD
SURPRISE
AZ
85374
2103
FAMOUS FOOTWEAR
WEST POINT CROSSING
1193 W. IRVINGTON ROAD, BLDG. 10
TUSCON
AZ
85746
2185
FAMOUS FOOTWEAR
FOUR PEAKS PLAZA
16815 E SHEY BLVD,STE 127
FOUNTAIN HILLS
AZ
85268
2199
FAMOUS FOOTWEAR
NEC POWER AND MCKELLIPS
2043 N POWER RD
MESA
AZ
85215
2231
FAMOUS FOOTWEAR
PRESCOTT GATEWAY
3250 GATEWAY BLVD SP 100
PRESCOTT
AZ
86303
2232
FAMOUS FOOTWEAR
PEORIA CROSSING
9450 W NORTHERN AVE
PEORIA
AZ
85305

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
 
   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2265
FAMOUS FOOTWEAR
PALM VALLEY PAVILIONS WEST
1430 N LITCHFIELD DRIVE
GOODYEAR
AZ
85338
2336
FAMOUS FOOTWEAR
PHOENIX SPECTRUM MALL
1633 WEST BETHANY HOME ROAD
PHOENIX
AZ
85015
2339
FAMOUS FOOTWEAR
FOOTHILLS MALL
7401 N LA CHOLLA     #100
TUCSON
AZ
85741
2352
FAMOUS FOOTWEAR
HAPPY VALLEY TOWNE CENTER
2501 W. HAPPY VALLEY ROAD
PHOENIX
AZ
85027
2353
FAMOUS FOOTWEAR
GATEWAY TOWNE CENTER
5002 SOUTH POWER ROAD
GILBERT (RIDLEY)
AZ
85236
2354
FAMOUS FOOTWEAR
CROSSROADS TOWNE CENTER
3775 SOUTH GILBERT ROAD
GILBERT
AZ
85234
2361
FAMOUS FOOTWEAR
LEGACY VILLAGE
2050 EAST BASELINE ROAD
PHOENIX
AZ
85042
2386
FAMOUS FOOTWEAR
YUMA PALMS REGIONAL CENTER
1480 YUMA PALMS PARKWAY
YUMA
AZ
85365
2426
FAMOUS FOOTWEAR
TEMPE MARKETPLACE
1800 EAST RIO SALADO PARKWAY
TEMPE
AZ
85281
2485
FAMOUS FOOTWEAR
OLD SPANISH TRAIL MARKETPLACE
9610 EAST 22ND STREET
TUCSON
AZ
85748
2508
FAMOUS FOOTWEAR
SUPERSTITION GATEWAY
1910 SIGNAL BUTTE ROAD
MESA
AZ
85209
2525
FAMOUS FOOTWEAR
PECAN PROMENADE
9820 W LOWER BUCKEYE ROAD
TOLLESON
AZ
85353
2550
FAMOUS FOOTWEAR
LAKE PLEASANT TOWN CENTER
10078 HAPPY VALLEY ROAD BOX #2
PEORIA
AZ
85383
2554
FAMOUS FOOTWEAR
MESA RIVERVIEW
833 N DOBSON ROAD  SUITE 101
MESA
AZ
85201
2576
FAMOUS FOOTWEAR
FULTON RANCH TOWN CENTER
4140 S ARIZONA AVENUE
CHANDLER
AZ
85248
2626
FAMOUS FOOTWEAR
METRO CENTER
9617 N. METRO PARKWAY # 1050
PHOENIX
AZ
85051
2649
FAMOUS FOOTWEAR
THE PROMENADE & CASA GRANDE
1004 N PROMENADE PARKWAY # 127
CASA GRANDE
AZ
85294

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2728
FAMOUS FOOTWEAR
QUEEN CREEK MARKETPLACE
21128 E ELLSWORTH ROAD
QUEEN CREEK
AZ
85242
2729
FAMOUS FOOTWEAR
ORO VALLEY MARKETPLACE
2040 E. TANGERINE ROAD
ORO VALLEY
AZ
85755
2735
FAMOUS FOOTWEAR
BELL TOWNE CENTER
401 E BELL ROAD  SUITE 1
PHOENIX
AZ
85022
2753
FAMOUS FOOTWEAR
THE SHOPS @ LAKE HAVASU
5601 N HIGHWAY 95 BUILDING J-902
LAKE HAVASU CITY
AZ
86404
2789
FAMOUS FOOTWEAR
MOHAVE CROSSROADS
3699 HIGHWAY 95 SUITE 120
BULLHEAD CITY
AZ
86442
90850
NATURALIZER
PARADISE VALLEY MALL
4550-56 CACTUS ROAD
PHOENIX
AZ
85032
90899
NATURALIZER
ARROWHEAD TOWN CENTER
7700 W. ARROWHEAD TOWN CTR, SP.1187
GLENDALE
AZ
85308
91018
NATURALIZER
CHANDLER FASHION CENTER
3499 WEST CHANDLER BLVD., STE. 1132
CHANDLER
AZ
85226
90
FAMOUS FOOTWEAR
CRESTVIEW S.C.
4744 MANZANITA AVE
CARMICHAEL
CA
95608
224
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
304 NUT TREE
VACAVILLE
CA
95687
238
FAMOUS FOOTWEAR
WESTGATE MALL
1600 SARATOGA AVE #415-17
SAN JOSE
CA
95129
248
FAMOUS FOOTWEAR
BROADSTONE CENTER
2775 EAST BIDWELL STREET, STE 200
FOLSOM
CA
95630
320
FAMOUS FOOTWEAR
TWIN PEAKS PLAZA
14737 POMERADO ROAD
POWAY
CA
92064
331
FAMOUS FOOTWEAR
DESERT HILLS PREMIUM OUTLET
48650 SEMINOLE DR. #C142
CABAZON
CA
92230
396
FAMOUS FOOTWEAR
PRIME OUTLETS @ANDERSON
1737 STATE HIGHWAY 273
ANDERSON
CA
96007
629
FAMOUS FOOTWEAR
EL CAMINO NORTH SHOPPING CTR
2505 WEST VISTA WAY, SUITE A
OCEANSIDE
CA
92054
676
FAMOUS FOOTWEAR
FACTORY MERCHANTS
2592 MERCANTILE WAY STE E
BARSTOW
CA
92311

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
    STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS     CITY   STATE   ZIP/MAIL CODE
694
FAMOUS FOOTWEAR
GREAT MALL OF BAY AREA
571 GREAT MALL DR
MILPITAS
CA
95035
957
FAMOUS FOOTWEAR
LANCASTER FACTORY STORES
44920 VALLEY CTR WAY #103
LANCASTER
CA
93536
967
FAMOUS FOOTWEAR
MARKETPLACE 99
9163 E STOCKTON BLVD #390
ELK GROVE
CA
95624
995
FAMOUS FOOTWEAR
VILLAGE @ ORANGE
1500 E VILLAGE WAY #2135
ORANGE
CA
92865
1032
FAMOUS FOOTWEAR
ATASCADERO FACTORY OUTLET
2100 EL CAMINO REAL  SUITE 2070
ATASCADERO
CA
93422
1047
FAMOUS FOOTWEAR
INLAND CENTER MALL
132 INLAND CENTER DRIVE
SAN BERNARDINO
CA
92408
1054
FAMOUS FOOTWEAR
FOOTHILL RANCH TOWNE CTR
26736 PORTLOLA PKWY STE C
FOOTHILL RANCH
CA
92610
1108
FAMOUS FOOTWEAR
PENINSULA S.C.
35 PENSINSULA CENTER
ROLLING HILLS ESTATES
CA
90274
1123
FAMOUS FOOTWEAR
SANTA MARIA CROSSROADS
2338 S. BRADLEY RD., SUITE 10-A
SANTA MARIA
CA
93455
1150
FAMOUS FOOTWEAR
MARKET AT LAGUNA NIGUEL
27150-#C ALICIA PARKWAY
LAGUNA NIGUEL
CA
92677
1154
FAMOUS FOOTWEAR
GREAT MALL OF BAY AREA
456 GREAT MALL DR
MILPITAS
CA
95035
1161
FAMOUS FOOTWEAR
THE QUAD AT WHITTIER
13460 WHITTIER BLVD
WHITTIER
CA
90605
1171
FAMOUS FOOTWEAR
VALLCO MALL
10123 N. WOLFE RD SUITE 2013
CUPERTINO
CA
95014
1179
FAMOUS FOOTWEAR
NATOMA STATION FACTORY
13000 FOLSOM BLVD #904
FOLSOM
CA
95630
1180
FAMOUS FOOTWEAR
FACTORY STORES LAKE ARROW
28200 HWY 189   #E250
LAKE ARROWHEAD
CA
92352
1189
FAMOUS FOOTWEAR
HEMET VALLEY MALL
2200  W. FLORIDA AVE 155
HEMET
CA
92545
1194
FAMOUS FOOTWEAR
PRIME OUTLETS @ GILROY
681 LEAVESLY ROAD #200
GILROY
CA
95020
1204
FAMOUS FOOTWEAR
GROSSMONT MALL
5500 GROSSMONT DR. 189
LA MESA
CA
91942

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
    STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
1206
FAMOUS FOOTWEAR
CROSSROADS S.C.
2548 BELL ROAD
AUBURN
CA
95603
1222
FAMOUS FOOTWEAR
NEWPARK MALL
1228 NEW PARK MALL
NEWARK
CA
94560
1223
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
2700 COLORADO BLVD STE248
EAGLE ROCK
CA
90041
1244
FAMOUS FOOTWEAR
MARKET PLACE
25680 N THE OLD ROAD
VALENCIA
CA
91381
1266
FAMOUS FOOTWEAR
SANTA MARGARITA TOWN CTR.
30616 SANTA MARGARITA PKW
RANCHO SANTA MARGARITA
CA
92688
1283
FAMOUS FOOTWEAR
DESERT CROSSINGS
72-399B HWY 111
PALM DESERT
CA
92261
1286
FAMOUS FOOTWEAR
SOUTHLAND MALL
219 SOUTHLAND MALL
HAYWARD
CA
94545
1298
FAMOUS FOOTWEAR
SIERRA VISTA
1050 SHAW AVE STE 1071
CLOVIS
CA
93612
1303
FACTORY BRAND SHOES
PETALUMA VLG PREMIUM OL
2200 PETALUMA BLVD.N.1030
PETALUMA
CA
94952
1318
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
484 PLAZA DRIVE
WEST COVINA
CA
91793
1321
FACTORY BRAND SHOES
CAMARILLO PREMIUM OUTLET
690 VENTURA BLVD STE#134
CAMARILLO
CA
93010
1322
FACTORY BRAND SHOES
NAPA PREMIUM OUTLETS
815 FACTORY STORES DRIVE
NAPA
CA
94558
1340
FAMOUS FOOTWEAR
STONEWOOD CENTER
324 STONEWOOD STREET
DOWNEY
CA
90241
1379
FACTORY BRAND SHOES
ONTARIO MILLS
1 MILLS CIRCLE-SUITE 803
ONTARIO
CA
91764
1422
FACTORY BRAND SHOES
HORIZON OUTLET CENTER
1427 HORIZON DRIVE
TULARE
CA
93274
1449
FAMOUS FOOTWEAR
ENCINITAS TOWN CENTER
1026 N. ELCAMINO REAL
ENCINITAS
CA
92023
1536
FACTORY BRAND SHOES
PRIME OUTLETS @ PISMO
333 FIVE CITIES DR-#135
PISMO BEACH
CA
93449
1544
FACTORY BRAND SHOES
CARLSBAD COMPANY STORES
5620 PASEO DEL NORTE #112
CARLSBAD
CA
92008

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
   STORE #   TRADE/STORE NAME     MALL/SHOPPING CENTER    ADDRESS     CITY   STATE   ZIP/MAIL CODE
1551
FACTORY BRAND SHOES
PRIME @LAKE ELSINORE
17600 COLLIER STE C124
LAKE ELSINORE
CA
92530
1552
FACTORY BRAND SHOES
PRIME OUTLETS @ TRACY
1005 E PESCARDERO-#A26
TRACY
CA
95376
1571
FAMOUS FOOTWEAR
NORTH COUNTY SQUARE
1821 UNIVERSITY AVE #110
VISTA
CA
92083
1623
FAMOUS FOOTWEAR
RANCHO SAN DIEGO
2907 JAMACHA RD
EL CAJON
CA
92019
1624
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
415 PARKWAY PLAZA-SP Z1
EL CAJON
CA
92020
1630
FAMOUS FOOTWEAR
LONG BEACH TOWNE CENTER
7378 CARSON BLVD.
LONG BEACH
CA
90808
1641
FACTORY BRAND SHOES
VIEJAS SPRINGS FACTORY SH
5005 WILLOWS RD-SPACE 622
ALPINE
CA
91901
1655
FAMOUS FOOTWEAR
NATOMAS MARKETPLACE
3681 TRUXEL ROAD
SACRAMENTO
CA
95833
1680
FACTORY BRAND SHOES
AMERICAN TIN CANNERY
125 OCEAN VIEW BLVD. #121
PACIFIC GROVE
CA
93950
1698
FAMOUS FOOTWEAR
GLENDALE FASHION CENTER
233 N. GLENDALE AVE.
GLENDALE
CA
91206
1791
FACTORY BRAND SHOES
INTERNATIONAL GATEWAY
4265 CAMINO DE LA PLAZA SPACE 184
SAN DIEGO
CA
92173
2005
FAMOUS FOOTWEAR
BREA UNION PLAZA
2315 EAST IMPERIAL HWY
BREA
CA
92821
2028
FAMOUS FOOTWEAR
CREEKSIDE TOWNE CENTER
1240 GALLERIA BLVD., SUITE 150
ROSEVILLE
CA
95678
2029
FAMOUS FOOTWEAR
HARBOR CENTER
2300 HARBOR BLVD.
COSTA MESA
CA
92626
2053
FAMOUS FOOTWEAR
HASTINGS VILLAGE SC
3389 E. FOOTHILL BLVD.
PASADENA
CA
91107
2061
FAMOUS FOOTWEAR
VICTOR VALLEY MALL
14400 BEAR VALLEY ROAD, STE 837
VICTORVILLE
CA
92392
2062
FAMOUS FOOTWEAR
PORTER RANCH TOWNE CENTER
19881 RINALDI STREET
PORTER RANCH
CA
91326
2064
FAMOUS FOOTWEAR
MONTE VISTA CROSSINGS
2810 W. MONTE VISTA AVE.
TURLOCK
CA
95380

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
2139
FAMOUS FOOTWEAR
CROSSINGS OF PASO
2105 THEATRE DRIVE
PASO ROBLES
CA
93446
2147
FAMOUS FOOTWEAR
CHICO POWER CENTER
2015 FOREST, STE. A
CHICO
CA
95926
2165
FAMOUS FOOTWEAR
NORTHWEST PROMEDADE
8920 ROSEDALE HWY
BAKERSFIELD
CA
93312
2230
FAMOUS FOOTWEAR
WESTRIDGE CENTER
1411 N. DAVIS ROAD
SALINAS
CA
93907
2233
FAMOUS FOOTWEAR
MT. SHASTA MALL
900 DANA DRIVE, STE. A-11
REDDING
CA
96003
2242
FAMOUS FOOTWEAR
SANTEE TROLLEY SQ
9934 MISSION GORGE RD
SANTEE
CA
92071
2268
FAMOUS FOOTWEAR
SPECTRUM TOWN CENTER
3857 GRAND AVE
CHICO
CA
91710
2278
FAMOUS FOOTWEAR
FALCON RIDGE TOWNE CENTER
15238 SUMMIT AVENUE
FONTANA
CA
92338
2306
FAMOUS FOOTWEAR
REDHAWK TOWNE CENTER
32155 HWY 79 STE B
TEMECULA
CA
92592
2308
FAMOUS FOOTWEAR
MOORPARK MARKETPLACE
824 LOS ANGELES AVE.  BUILDING C2
MOORPARK
CA
93021
2310
FAMOUS FOOTWEAR
VENTURA GATEWAY
4890 TELEPHONE ROAD
VENTURA
CA
93003
2322
FAMOUS FOOTWEAR
SUNRISE MALL
6161 SUNRISE MALL
CITRUS HEIGHTS
CA
95610
2330
FAMOUS FOOTWEAR
THE CROSSINGS
3335 GRAND OAKS
CORONA
CA
92881
2337
FAMOUS FOOTWEAR
CANYON SPRINGS
2800 CAMPUS PARKWAY, SUITE  105
RIVERSIDE
CA
92507
2338
FAMOUS FOOTWEAR
YUBA CITY MARKETPLACE
1140 HARTER ROAD
YUBA CITY
CA
95993
2343
FAMOUS FOOTWEAR
LOEHMANNS PLAZA
2531 FAIR OAKS BLVD
SACRAMENTO
CA
95825
2362
FAMOUS FOOTWEAR
PARK WEST PLACE
10652 TRINITY PARKWAY
STOCKON
CA
95219
2369
FAMOUS FOOTWEAR
CITRUS PLAZA RETAIL CENTER
27430 LUGONIA AVENUE
REDLANDS
CA
92374
2377
FAMOUS FOOTWEAR
BAYSHORE MALL
3300 BROADWAY # 136
EUREKA
CA
95501
2396
FAMOUS FOOTWEAR
HANFORD POWER CENTER
190 NORTH 12TH AVENUE
HANFORD
CA
93230
2418
FAMOUS FOOTWEAR
LONE TREE PLAZA
5471 LONE TREE WAY  # 120
BRENTWOOD
CA
94513

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
    STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS     CITY   STATE   ZIP/MAIL CODE
2439
FAMOUS FOOTWEAR
PACKWOOD CREEK REGIONAL SHOP. CTR.
4147 SOUTH MOONY BLVD.
VISALIA
CA
93277
2445
FAMOUS FOOTWEAR
VILLAGE WALK
24470 VILLAGE WALK PLACE
MURRIETA
CA
92562
2446
FAMOUS FOOTWEAR
THE PAVILION @ LA QUINTA
79-150 HWY 111  SUITE 101
LA QUINTA
CA
92253
2481
FAMOUS FOOTWEAR
THE MARKETPLACE @ GRAND CROSSING
21660 VALLEY BLVD.
CITY OF INDUSTRY
CA
91789
2488
FAMOUS FOOTWEAR
PACHECO PASS CENTER
950 RENZ LANE
GILROY
CA
95020
2517
FAMOUS FOOTWEAR
OAKRIDGE MALL
925 BLOSSOM HILL ROAD  SUITE A
SAN JOSE
CA
95123
2518
FAMOUS FOOTWEAR
CLOVIS COMMONS
625 HERNDON AVENUE
CLOVIS
CA
93611
2545
FAMOUS FOOTWEAR
SHAW MARKETPLACE
3667 W. SHAW AVENUE
FRESNO
CA
93711
2579
FAMOUS FOOTWEAR
STADIUM CENTER
2300 DANIELS STREET
MANTECA
CA
95337
2603
FAMOUS FOOTWEAR
EASTVALE GATEWAY II
12327 LIMONITE AVENUE
MIRO LOMA
CA
91752
2625
FAMOUS FOOTWEAR
STONERIDGE RANCH TOWN CENTER
27210 EUCALYPTUS AVENUE
MORENO VALLEY
CA
92553
2651
FAMOUS FOOTWEAR
LAGUNA HILLS MALL
24115 LAGUNA HILLS MALL
LAGUNA HILLS
CA
92653
2664
FAMOUS FOOTWEAR
NUT TREE VILLAGE
1621 F # MONATE VISTA AVE.
VACAVILLE
CA
95688
2683
FAMOUS FOOTWEAR
JESS RANCH MARKETPLACE
19083 BEAR VALLEY ROAD # A
APPLE VALLEY
CA
92308
2712
FAMOUS FOOTWEAR
LINCOLN CROSSINGS
117 FERRARI RANCH ROAD
LINCOLN
CA
95648
2737
FAMOUS FOOTWEAR
TJ MAXX PLAZA
1850 DOUGLAS ROAD  SUITE 706
ROSEVILLE
CA
95661
2780
FAMOUS FOOTWEAR
THE COMMONS @ LA VERNE
1572 FOOTHILL BLVD.
LA VERNE
CA
91750
2790
FAMOUS FOOTWEAR
WEST VALLEY MALL
3200 N NAGLEE ROAD  # 430
TRACY
CA
95304
2791
FAMOUS FOOTWEAR
POINT LOMA PLAZA
3651 MIDWAY DRIVE
SAN DIEGO
CA
92110

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
   STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2810
FAMOUS FOOTWEAR
CROSSROADS SHOPPING CENTER
2419 CLARIBEL ROAD
RIVERBANK
CA
95367
2880
FAMOUS FOOTWEAR
47TH STREET PAVILION
38141 47TH STREET
PALMDALE
CA
93552
2893
FAMOUS FOOTWEAR
ANTELOPE VALLEY MALL
1233 RANCHO VISTA BLVD.  # 501
PALMDALE
CA
93551
2894
FAMOUS FOOTWEAR
SIMI VALLEY TOWN CENTER
1555 SIMI VALLEY TOWN CENTER WAY  # 105
SIMI VALLEY
CA
93065
90749
NATURALIZER
GLENDALE GALLERIA
2180A GLENDALE GALLERIA
GLENDALE
CA
91210
90750
NATURALIZER
SANTA ANITA FASHION PARK
168 FASHION PARK, 400 S. BALDWIN
ARCADIA
CA
91007
90760
NATURALIZER
SOUTH COAST PLAZA
3333 BRISTOL STREET, SUITE 2810
COSTA MESA
CA
92626
90763
NATURALIZER
PLAZA CAMINO REAL
2525 EL CAMINO REAL, SUITE #275
CARLSBAD
CA
92008
90774
NATURALIZER
DEL AMO FASHION CENTER
21880 HAWTHORNE BLVD., SUITE 319
TORRANCE
CA
90503
90788
NATURALIZER
BREA MALL
1009 BREA MALL
BREA
CA
92821
90795
NATURALIZER
PALM DESERT
72840 HIGHWAY 111, SUITE T-381
PALM DESERT
CA
92260
94300
NATURALIZER
SERRAMONTE
5F SERRAMONTE
DALY CITY
CA
94015
94628
NATURALIZER
HILLSDALE SHOPPING CENTER
229 HILLSDALE SHOPPING CTR
SAN MATEO
CA
94403
94637
NATURALIZER
SANTA ANA MAINPLACE MALL
2800 NORTH MAIN, SUITE 306
SANTA ANA
CA
92705
96625
NATURALIZER OUTLET
DESERT HILLS PREMIUM OUTLET
48400 SEMINOLE DRIVE  # 624
CABAZON
CA
92230
96705
NATURALIZER OUTLET
FACTORY STORES OF AMERICA O.C.
311 NUT TREE RD., STE A
VACAVILLE
CA
95687
96710
NATURALIZER OUTLET
GILROY PREMIUM OUTLETS
8375 ARROYO CIRCLE A57
GILROY
CA
95020
96735
NATURALIZER OUTLET
LAKE ELSINORE OUTLET CENTER
17600  NEW COLLIER AVE. UNIT 148
LAKE ELSINORE
CA
92530

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
    STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
96744
NATURALIZER OUTLET
BARSTOW OUTLETS
2586 MERCANTILE WAY SUITE D
BARSTOW
CA
92311
96745
NATURALIZER OUTLET
VIEJAS SPRINGS FACTORY STORES
5001 WILLOWS ROAD, SUITE L-307
ALPINE
CA
91901
96762
NATURALIZER OUTLET
CAMARILLO PREMIUM OUTLETS
910 CAMARILLO CENTER, SPACE 836
CAMARILLO
CA
93010
96787
NATURALIZER OUTLET
FOLSOM PREMIUM OUTLETS
13000 FOLSOM BLVD., SUITE 1445
FOLSOM
CA
95630
96799
NATURALIZER OUTLET
GREAT MALL OF THE BAY AREA
502 GREAT MALL DRIVE
MILPITAS
CA
95035
99156
BROWN SHOE CLOSET
DESERT HILLS PREMIUM OUTLET
48400 SEMINOLE DRIVE  # 418
CABAZON
CA
92230
99901
FRANCO SARTO
EMBARCADERO CENTER
THREE EMBARCADERO CENTER DRIVE
SAN FRANCISCO
CA
94111
46
FAMOUS FOOTWEAR
COTTONWOOD CORNERS S.C.
3600 SOUTH MASON  UNIT 6
FORT COLLINS
CO
80525
121
FAMOUS FOOTWEAR
UNIVERSITY HILLS PLAZA
2526 S. COLORADO BLVD.
DENVER
CO
80222
165
FAMOUS FOOTWEAR
FAIRFIELD COMMONS S.C.
98 N. WADSWORTH BLVD
LAKEWOOD
CO
80226
527
FAMOUS FOOTWEAR
APPLEWOOD VILLAGE S.C.
3244A YOUNGFIELD RD
WHEAT RIDGE
CO
80033
560
FAMOUS FOOTWEAR
PRIME OUTLETS@CASTLEROCK
5050 FACTORY SHOP BLVD #710
CASTLE ROCK
CO
80104
928
FAMOUS FOOTWEAR
PRIME OUTLETS @LOVELAND
5725 MC WHINNEY BLVD.
LOVELAND
CO
80538
1299
FAMOUS FOOTWEAR
PUEBLO MALL
3283 DILLION DRIVE #E9
PUEBLO
CO
81008
1400
FAMOUS FOOTWEAR
CHAPEL HILLS MALL
1710 BRIARGATE BLVD
COLORADO SPRINGS
CO
80920
1620
FAMOUS FOOTWEAR
SOUTHWEST PLAZA
8501 W. BOWLES AVE#2D-217
LITTLETON
CO
80123
1650
FAMOUS FOOTWEAR
TWIN PEAKS MALL
1250 S. HOVER RD
LONGMONT
CO
80501
1705
FAMOUS FOOTWEAR
MARKETPLACE AT NORTHGLENN
10620 MELODY DRIVE
NORTHGLENN
CO
80234

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
    STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY     CITY   ZIP/MAIL CODE
1759
FAMOUS FOOTWEAR
ARAPAHOE CROSSINGS
6472 SOUTH PARKER ROAD
AURORA
CO
80012
2037
FAMOUS FOOTWEAR
MESA MALL
2424 US HWY 6 & 50
GRAND JUNCTION
CO
81505
2052
FAMOUS FOOTWEAR
SYMES BUILDING
820 16TH STREET
DENVER
CO
80202
2102
FAMOUS FOOTWEAR
BROADMOOR TOWN CENTER
2170 SOUTHGATE ROAD
COLORADO SPRINGS
CO
80906
2111
FAMOUS FOOTWEAR
WESTMINSTER MALL
5503 WEST 88TH AVENUE
WESTMINSTER
CO
80031
2176
FACTORY BRAND SHOES
COLORADO MILLS
14500 W COLFAX  SUITE 278
LAKEWOOD
CO
80401
2208
FAMOUS FOOTWEAR
FLATLRON MARKETPLACE
170 EAST FLATIRON CIRCLE
BROOMFIELD
CO
80021
2243
FAMOUS FOOTWEAR
QUEBEC SQUARE
7757 E 36TH AVE SUITE 680
DENVER
CO
80207
2297
FAMOUS FOOTWEAR
FLAT ACRES MARKET CENTER
11475 S. TWENTY MILE ROAD
PARKER
CO
80134
2311
FAMOUS FOOTWEAR
AURORA CITY PLACE
14180 E ELLSWORTH AVE UNIT B
AURORA
CO
80012
2317
FAMOUS FOOTWEAR
SAFEWAY MARKETPLACE EAST
3080 N POWERS BLVD
COLORADO SPRINGS
CO
80922
2345
FAMOUS FOOTWEAR
THORNCREEK SHOPPING CENTER
1181 E 120TH AVENUE  UNIT A
THORNTON
CO
80233
2381
FAMOUS FOOTWEAR
 
4508 CENTERPLACE DR.  # 384
GREELEY
CO
80634
2392
FAMOUS FOOTWEAR
 
5765 N. ELIZABETH STREET
PUEBLO
CO
81008
2395
FAMOUS FOOTWEAR
SOUTHLANDS
24101 E. ORCHARD ROAD  UNIT B
AURORA
CO
80012
2429
FACTORY BRAND SHOES
SILVERTHORNE FACTORY OUTLETS SHOPS
145 STEPHENS  WAY - P.O. BOX 29
SILVERTHORNE
CO
80498
2457
FAMOUS FOOTWEAR
THE SHOPPES @ CENTERRA
5985 SKY POND DRIVE  SUITE B-142
LOVELAND
CO
80536
2464
FAMOUS FOOTWEAR
THE CITADEL  MALL
750 CITADEL DRIVE EAST SPACE 2284
COLORADO SPRINGS
CO
80909

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS     CITY   STATE   ZIP/MAIL CODE
2482
FAMOUS FOOTWEAR
DURANGO MALL
800 SOUTH CAMINO DEL RIO  SPACE C-5
DURANGO
CO
81301
2514
FAMOUS FOOTWEAR
GLENWOOD SPRINGS MALL
51027 HIGHWAY 6   SUITE 161
GLENWOOD SPRINGS
CO
81601
2555
FAMOUS FOOTWEAR
NORTHFIELD @ STAPLETON
85560 EAST 49TH AVENUE # 1910
DENVER
CO
80238
2600
FAMOUS FOOTWEAR
HARVEST JUNCTION SOUTH
205 KEN PRATT BLVD. SUITE 170
LONGMONT
CO
80501
2653
FAMOUS FOOTWEAR
TWENTY NONTH STREET
1600 28TH STREET  SUITE 1204
BOULDER
CO
80301
2742
FAMOUS FOOTWEAR
FRONT RANGE VILLAGE
4321 CORBETT DRIVE SUITE 118
FORT COLLINS
CO
80525
2783
FAMOUS FOOTWEAR
RIVER LANDING
3421 RIO GRANDE UNIT B
MONTROSE
CO
81401
2796
FAMOUS FOOTWEAR
VILLAGE ON THE PARK
2495 S. HAVANA  ST  UNIT 1
AURORA
CO
80014
2797
FAMOUS FOOTWEAR
PRAIRIE CENTER
2431 PRAIRIE CENTER PARKWAY  #C
BRIGHTON
CO
80601
96644
NATURALIZER OUTLET
COLORADO MILLS
14500 W COLFAX  SUITE 280
LAKEWOOD
CO
80401
1148
FAMOUS FOOTWEAR
OLD SAYBROOK FACTORY STRS
314 FLAT ROCK PLACE
WESTBROOK
CT
06498
1616
FAMOUS FOOTWEAR
BRASS MILL
495 UNION STREET #2082
WATERBURY
CT
06721
1617
FAMOUS FOOTWEAR
PAVILLIONS AT BUCKLAND
194 BUCKLAND HILLS #1014
MANCHESTER
CT
06040
2140
FAMOUS FOOTWEAR
LISBON LANDING
160 RIVER ROAD, STE. A-180
LISBON
CT
06351
2252
FAMOUS FOOTWEAR
CONNECTICUT COMMONS
244 N. BRITAIN AVENUE
PLAINVILLE
CT
06062
2315
FAMOUS FOOTWEAR
OLD SAYBROOK SC
655 BOSTON POST RD
OLD SAYBROOK
CT
06475 
2407
FAMOUS FOOTWEAR
NEW LONDON MALL
351 N. FRONTAGE ROAD   UNIT B-4
NEW LONDON
CT
06320
2469
FAMOUS FOOTWEAR
TOWN LINE SQUARE
533 SOUTH BROAD STREET
MERIDEN
CT
06450
2523
FAMOUS FOOTWEAR
CHRISTMAS TREE SHOPS
200 INDIAN RIVER ROAD SPACE 7-A
ORANGE
CT
06477
2573
FAMOUS FOOTWEAR
DANBURY SQUARE MALL
15 BACKUS AVENUE SPACE 6-A
DANBURY
CT
06810

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
2582
FAMOUS FOOTWEAR
EASTBROOK MALL
95 STORRS ROAD
MANSFIELD(WILLIMANTIC)
CT
06268
2596
FAMOUS FOOTWEAR
ELM PLAZA
99 ELM STREET
ENFIELD
CT
06082
2619
FAMOUS FOOTWEAR
TORRINGFORD PLAZA
1920 E MAIN STREET  SPACE A-2
TORRINGTON
CT
06790
2662
FAMOUS FOOTWEAR
SIMSBURY COMMONS
530 BUSHY HILL ROAD  SUITE 70
SIMSBURY
CT
06070
2669
FAMOUS FOOTWEAR
KENNEDY ROAD MARKETPLACE
1065 KENNEY ROAD  SUITE 1
WINDSOR
CT
06095
96767
NATURALIZER OUTLET
WESTBROOK FACTORY STORES
314 FLAT ROCK PL, SPACE B130
WESTBROOK
CT
06498
1439
FAMOUS FOOTWEAR
REHOBOTH OUTLETS III
1790 OCEAN OUTLETS 2
REHOBOTH BEACH
DE
19971
1708
FAMOUS FOOTWEAR
SHIPYARD CATALOG OUTLETS
950 S. MADISON ST
WILMINGTON
DE
19801
2039
FAMOUS FOOTWEAR
PRICES CORNER
3238 KIRKWOOD HWY
WILMINGTON
DE
19808
93319
NATURALIZER
CONCORD MALL
SPACE # 640
WILMINGTON
DE
19803
96608
NATURALIZER
REHOBOTH OUTLETS III
36502 SEASIDE OUTLET DRIVE.  SUITE 1260
REHOBOTH BEACH
DE
19971
99119
BROWN SHOE CLOSET
TANGER OUTLET CENTER
36494 SEASIDE OUTLET DRIVE  SUITE 1420
REHOBOTH BEACH
DE
19971
23
FAMOUS FOOTWEAR
SANIBEL FACTORY STORES
20350 SUMMERLIN RD #1150
FORT MYERS
FL
33908
313
FAMOUS FOOTWEAR
LARGO MALL
10500 ULMERTON ROAD #670
LARGO
FL
33771
324
FAMOUS FOOTWEAR
SAWGRASS MILLS
12801 W SUNRISE BLVD #607
SUNRISE
FL
33322
335
FAMOUS FOOTWEAR
RIVERPLACE S.C.
11111 SAN JOSE BLVD - #24
JACKSONVILLE
FL
32223
336
FAMOUS FOOTWEAR
NORTHDALE COURT SHOPPING
15732 N. DALE MABRY HWY
TAMPA
FL
33624
350
FAMOUS FOOTWEAR
ST. AUGUSTINE OUTLET CTR
2700 S.R. 16 #315
ST AUGUSTINE
FL
32092

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS     CITY   STATE   ZIP/MAIL CODE
488
FAMOUS FOOTWEAR
ARGYLE FOREST BLVD.
6001-34 ARGYLE FOREST
JACKSONVILLE
FL
32244
619
FAMOUS FOOTWEAR
SILVER SANDS FACTORY OUT.
10406 EMERALD COAST PKWY1 US HWY 98
DESTIN
FL
32541
624
FAMOUS FOOTWEAR
MERCHANTS CROSSING #1201
15201 N. CLEVELAND AVE
FORT MYERS
FL
33903
677
FAMOUS FOOTWEAR
PRIME OUTLETS @ ELLENTON
5339 FACT.SHPS BLVD #550
ELLENTON
FL
34222
688
FAMOUS FOOTWEAR
SUNSET 19 S.C.
23666 US HWY 19 NORTH
CLEARWATER
FL
34625
1023
FAMOUS FOOTWEAR
HIGHLAND LAKES S.C.
33521 US HWY 19 NO.
PALM HARBOR
FL
34684
1040
FAMOUS FOOTWEAR
CORAL RIDGE MALL
3200 N. FEDERAL HWY #601
FT LAUDERDALE
FL
33306
1068
FAMOUS FOOTWEAR
OAKWOOD PLAZA
3551 OAKWOOD BLVD BAY  6
HOLLYWOOD
FL
33020
1083
FAMOUS FOOTWEAR
LAKE WORTH PLAZA WEST
6440 LAKE WORTH ROAD
LAKE WORTH
FL
33463
1195
FAMOUS FOOTWEAR
PRIME OUTLETS @VERO BEACH
1775 94TH DRIVE STE D-130
VERO BEACH
FL
32966
1215
FAMOUS FOOTWEAR
DEERFIELD MALL
3888 W HILLSBORO BLVD
DEERFIELD BEACH
FL
33442
1231
FAMOUS FOOTWEAR
LAKE BUENA VISTA F.O.
15549 S. APOPKA VINELAND
ORLANDO
FL
32836
1237
FAMOUS FOOTWEAR
SHADOWOOD SQUARE
9825 GLADES ROAD
BOCA RATON
FL
33434
1336
FAMOUS FOOTWEAR
SOUTHSIDE SQUARE
9041 SOUTHSIDE BLVD #128
JACKSONVILLE
FL
32256
1401
FAMOUS FOOTWEAR
LAKE SQUARE MALL
10401 US HYWY 441
LEESBURG
FL
34788
1634
FAMOUS FOOTWEAR
BELZ FACTORY OUTLET
500 BELZ OUTLET BLVD.
ST AUGUSTINE
FL
32095
1639
FAMOUS FOOTWEAR
DOLPHIN MALL
11401 NORTHWEST 12TH ST., STE. 389
WEST MIAMI
FL
33172
1669
FAMOUS FOOTWEAR
MIROMAR OUTLET CENTER
10801 CORKSCREW RD.  UNIT 132
ESTERO
FL
33928

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
1675
FAMOUS FOOTWEAR
PRIME @ FLORIDA CITY
250 E. PALM DRIVE #115
FLORIDA CITY
FL
33034
1677
FACTORY BRAND SHOES
FACTORY STORES OF AMERICA
950 PRIM AVE. SUITE 108
GRACEVILLE
FL
32440
1706
FAMOUS FOOTWEAR
PLAZA AT CITRUS PARK
12699 CITRUS PLAZA DR.  SPACE 120
TAMPA
FL
33625
1722
FAMOUS FOOTWEAR
WATERFORD LAKES TOWN CTR
379 NL. ALAFAYA TRAIL
ORLANDO
FL
32828
1724
FAMOUS FOOTWEAR
ORLANDO PREMIUM OUTLET
8200 VINELAND AVE  # 1114
ORLANDO
FL
32821
1760
FAMOUS FOOTWEAR
CORAL SKY PLAZA
554 N. STATE RD. 7
ROYAL PALM BEACH
FL
33411
1774
FAMOUS FOOTWEAR
SARASOTA PAVILION
6513 SOUTH TAMIAMI TRAIL
SARASOTA
FL
34231
1777
FAMOUS FOOTWEAR
VOLUSIA SQUARE S.C.
2455 W.INTL SPEEDWAY BLVD
DAYTONA BEACH
FL
32114
2020
FAMOUS FOOTWEAR
HERITAGE PLAZA
18700K VETERANS BLVD
PORT CHARLOTTE
FL
33954
2021
FAMOUS FOOTWEAR
WESTCHESTER S.C.
8673 S.W. 24TH STREET
MIAMI
FL
33155
2023
FAMOUS FOOTWEAR
OAKS SQUARE
6843 NEWBERRY ROAD
GAINESVILLE
FL
32605
2040
FAMOUS FOOTWEAR
PRIME OUTLET @ NAPLES
6060 COLLIER BLVD SP 44-48
NAPLES
FL
34114
2047
FAMOUS FOOTWEAR
GOVERNORS SQUARE MP
1554 GOVERNORS SQUARE BLVD.
TALLAHASSEE
FL
32303
2054
FACTORY BRAND SHOES
INTERNATIONAL OUTLET SC
5580 INTERNATIONAL DRIVE
ORLANDO
FL
32819
2074
FAMOUS FOOTWEAR
KENDALL VILLAGE
8651 SW 124 AVENUE
MIAMI
FL
33183
2258
FAMOUS FOOTWEAR
AVENTURA COMMONS
21065 BISCAYNE BLVD
AVENTURA
FL
33180
2259
FAMOUS FOOTWEAR
UNIVERSITY MALL
2241 UNIVERSITY SQ MALL
TAMPA
FL
33612
2272
FAMOUS FOOTWEAR
GAITEWAY CENTER
2701 SW COLLEGE RD #402
OCALA
FL
34478
2340
FAMOUS FOOTWEAR
CLEARWATER MALL
2739 GULF TO BAY BLVD
CLEARWATER
FL
33759

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
2363
FAMOUS FOOTWEAR
ORLANDO SQUARE
1750 SAND LAKE ROAD WEST
ORLANDO
FL
32809
2378
FAMOUS FOOTWEAR
THE LOOP
3282 N JOHN YOUNG PARKWAY
KISSIMMEE
FL
34741
2398
FAMOUS FOOTWEAR
ST. JOHN TOWN CENTER
10261 RIVER MARSH DRIVE  SUITE 167
JACKSONVILLE
FL
32246
2422
FAMOUS FOOTWEAR
THE AVENUE VIERA
2291 TOWN CENTER AVENUE # 105
MELBOURNE
FL
32940
2468
FAMOUS FOOTWEAR
COCONUT POINT
8024 MEDITERRANEAN DRIVE
ESTERO
FL
33928
2494
FAMOUS FOOTWEAR
LAKESIDE VILLAGE
1482 TOWN CENTER DRIVE
LAKELAND
FL
33803
2505
FAMOUS FOOTWEAR
REGENCY SHOPPING CENTER
651-525 COMMERCE CENTER
JACKSONVILLE
FL
32225
2506
FAMOUS FOOTWEAR
SHOPPES @ PARK PLACE
7180 US HIGHWAY 19 NORTH
PINELLAS PARK
FL
33781
2557
FAMOUS FOOTWEAR
EMBASSY CROSSING SHOP CENTER
9618 US HWY 19 N
PORT RICHEY
FL
34668
2595
FAMOUS FOOTWEAR
WEST VOLUSIA TOWNE CENTER
1021 HARLEY STRICKLAND BLVD.
ORANGE CITY
FL
32763
2611
FAMOUS FOOTWEAR
PINE ISLAND MARKET PLACE
519 SW PINE ISLAND ROAD, UNIT 112
CAPE CORAL
FL
33993
2623
FAMOUS FOOTWEAR
WINTER GARDEN TOWN CENTER
3191 DANIELS ROAD
WINTER GARDEN
FL
34787
2624
FAMOUS FOOTWEAR
THE LANDING @ TRADITION
10848 SW TRADITION PARKWAY/VILLAGE PARKWAY
PORT ST. LUCIE
FL
34987
2644
FAMOUS FOOTWEAR
CRYSTAL RIVER MALL
1801 NW HIGHWAY 19,  SUITE 151 A
CRYSTAL RIVER
FL
34428
2647
FAMOUS FOOTWEAR
LONDON SQUARE
13630 SW 120TH STREET  SUITE 206
MIAMI
FL
33186
2654
FACTORY BRAND SHOES
PRIME OUTLETS @ ORLANDO
4973 INTERNATIONAL DRIVE  STUIE  3F15
ORLANDO
FL
32819

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2661
FAMOUS FOOTWEAR
PARK STREET RETAIL CENTER
4930 PARK STREET NORTH
ST. PETERSBURG (SEMINOLE)
FL
33709
2665
FAMOUS FOOTWEAR
SHOPS @ SHELBY CROSSING
1728 US 27 & NORTH
SEBRING
FL
33870
2668
FAMOUS FOOTWEAR
OAKLEAF TOWN CENTER
8181 MERCHANTS GATE DRIVE  SUITE 102
JACKSONVILLE
FL
32222
2697
FAMOUS FOOTWEAR
THE SHOPS @ MIDTOWN MIAMI
3401 N. MIAMI AVENUE  SUITE 102
MIAMI
FL
33127
2784
FAMOUS FOOTWEAR
PALM COAST LANDING
5240 STATE ROUTE 100
PALM COAST
FL
32164
2821
FAMOUS FOOTWEAR
WALTERS CROSSING
1526 N. DALE MABRY HIGHWAY
TAMPA
FL
33607
93495
NATURALIZER
COUNTRYSIDE MALL
27001 US HWY 19 NORTH, SUITE 1057
CLEARWATER
FL
33761
93615
NATURALIZER
PEMBROKE LAKES MALL
11401 PINES BLVD., LOT #414
PEMBROKE PINES
FL
33026
93617
NATURALIZER
MIAMI INTERNATIONAL
1455 N.W. 107TH AVENUE, SUITE 354
MIAMI
FL
33172
93621
NATURALIZER
WESTLAND MALL
1665 W. 49TH STREET
HIALEAH
FL
33012
93622
NATURALIZER
THE GARDENS OF PALM BEACH
3101 PGA BLVD., SPACE F-101
PALM BEACH GARDENS
FL
33410
93624
NATURALIZER
DADELAND MALL
7485 SW 88 ST. - SP 1906
MIAMI
FL
33156
93633
NATURALIZER
FLORIDA MALL
8001 S. ORANGE BLOSSOM TRAIL, STE 650
ORLANDO
FL
32809
93635
NATURALIZER
THE AVENUES
10300 SOUTHSIDE, SP. 154
JACKSONVILLE
FL
32256
96630
NATURALIZER OUTLET
SAWGRASS MILLS
12801 W SUNRISE BLVD #713
SUNRISE
FL
33323
96749
NATURALIZER OUTLET
ORLANDO PREMIUM OUTLET
8200 VINELAND AVE, SPACE #430
ORLANDO
FL
32821

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
96757
NATURALIZER OUTLET
PRIME OUTLETS AT ELLENTON
5545 FACTORY SHOP BLVD.
ELLENTON
FL
34222
96784
NATURALIZER OUTLET
SILVER SANDS FACTORY STORES
10746 W. EMERALD COAST PKWY, SUITE 162
DESTIN
FL
32550
99116
BROWN SHOE CLOSET
THE SHOPS @ WIREGRASS
28329 PASEO DRIIVE # 110
WESLEY CHAPEL
FL
33544
99124
BROWN SHOE CLOSET
PRIME OUTLETS @ ELLENTON
5545 FACTORY SHOPS BLVD.
ELLENTON
FL
34222
469
FAMOUS FOOTWEAR
LAKE PARK MILL STORE PLZA
5173 MILLSTONE ROAD
LAKE PARK
GA
31636
687
FAMOUS FOOTWEAR
MANSELL CROSSING
7561 NORTHPOINT PKWY #900
ALPHARETTA
GA
30202
900
FAMOUS FOOTWEAR
SAVANNAH FESTIVAL FAC.STR
11 GATEWAY BLVD SO. #125
SAVANNAH
GA
31419
942
FAMOUS FOOTWEAR
FACTORY STORES AT ADEL
1203 W.4TH ST. SUITE 23
ADEL
GA
31620
1253
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
1000 TANGER DRIVE STE 310
LOCUST GROVE
GA
30248
1335
FAMOUS FOOTWEAR
HIRAM CROSSING
4272 JIMMY LEE PKWY
HIRAM
GA
30141
1396
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
800 STEVEN B TANGER BLVD
COMMERCE
GA
30529
1446
FAMOUS FOOTWEAR
PEACHTREE SQUARE
3200 HOLCOMB BRIDGE RD
NORCROSS
GA
30092
1472
FAMOUS FOOTWEAR
MAIN ST. SHOPPING CTR
120 CHEROKEE PL STE 130
CARTERSVILLE
GA
30120
1478
FAMOUS FOOTWEAR
FAYETTEVILLE PAVILION
113 PAVILION PARKWAY
FAYETTEVILLE
GA
30214
1512
FAMOUS FOOTWEAR
N.GEORGIA PREM.OL
800 HWY 400 SO. SUITE 635
DAWSONVILLE
GA
30534
1553
FAMOUS FOOTWEAR
PRIME OUTLETS @ CALHOUN
455 BELWOOD CENTER-STE 73
CALHOUN
GA
30701
1611
FAMOUS FOOTWEAR
RIVERSTONE PLAZA
1443 RIVERSTONE PKWY
CANTON
GA
30114

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
1612
FAMOUS FOOTWEAR
PEACH FACTORY STORES
311 HWY 49 NORTH-STE 240
BYRON
GA
31008
1666
FAMOUS FOOTWEAR
AUSTELL COMMONS
1757 EAST WEST CONNECTOR
AUSTELL
GA
30106
1758
FAMOUS FOOTWEAR
MALL OF GEORGIA COMMONS
3205 WOODWARD MILL PKWY
BUFORD
GA
30519
2011
FAMOUS FOOTWEAR
LAWRENCEVILLE MARKET SQUARE
875 LAWRENCE-SUWANEE ROAD  # 130
LAWRENCEVILLE
GA
30043
2046
FAMOUS FOOTWEAR
WOODSTOCK SHOPPING CENTER
126 WOODSTOCK SQUARE AVE.
WOODSTOCK
GA
30189
2071
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
1001 MARKET ST., STE. 5
DALTON
GA
30720
2168
FAMOUS FOOTWEAR
HENRY COUNTY MARKETPLACE
1894 JONESBORO ROAD
MCDONOUGH
GA
30253
2275
FAMOUS FOOTWEAR
GRIFFIN CROSSROADS
1559 NORTH EXPRESSWAY
GRIFFIN
GA
30223
2289
FAMOUS FOOTWEAR
AVENUES AT WEST COBB
3625 DALLAS HWY SW #260
MARIETTA
GA
30064
2410
FAMOUS FOOTWEAR
VILLAGE SHOPPES @ GAINESVILLE
833 DAWSONVILLE HIGHWAY  SUITE #250
GAINESVILLE
GA
30501
2475
FAMOUS FOOTWEAR
LAKESIDE MARKET PLACE
3384 N COBB PARKWAY
ACWORTH
GA
30101
2507
FAMOUS FOOTWEAR
CARROLLTON CROSSROADS
1309 S. PARK STREET
CARROLLTON
GA
30117
2526
FAMOUS FOOTWEAR
KEDRON VILLAGE CENTER
1233 N. PEACHTREE PARKWAY
PEACHTREE CITY
GA
30269
2592
FAMOUS FOOTWEAR
THE AVENUE @ WEBB GINN
1350 SCENIC HIGHWAY
SNELLVILLE
GA
30078
2613
FAMOUS FOOTWEAR
CONYERS CROSSROADS
2221 GEORGIA HIGHWAY 20
CONYERS
GA
30013
2642
FAMOUS FOOTWEAR
HERITAGE PAVILION
2540 CUMBERLAND BLVD.
SMYRNA
GA
30080
2643
FAMOUS FOOTWEAR
TOWN CENTER @ PRADO
50 ERNEST BARRETT  PARKWAY
MARIETTA
GA
30066
2678
FAMOUS FOOTWEAR
STONEBRIDGE VILLAGE
5863 SPOUT SPRINGS ROAD
FLOWERY BRANCH
GA
30542
2694
FAMOUS FOOTWEAR
DISCOVER MILLS
5900 SUGARLOAF PKWY ST 253
LAWRENCEVILLE
GA
30043

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2746
FAMOUS FOOTWEAR
BROOKWOOD MARKETPLACE
2623 PEACHTREE PARKWAY
SUWANEE
GA
30024
2891
FAMOUS FOOTWEAR
STONECREST MARKETPLACE
8120 MALL PARKWAY  SUITE 455
LITHONIA
GA
30038
2942
FAMOUS FOOTWEAR
GLYNN ISLES MARKETPLACE
110 GLYNN ISLES
BRUNSWICK
GA
31525
91049
NATURALIZER
PEACHTREE CENTER
231 PEACHTREE ST, SUITE B25
ATLANTA
GA
30303
96737
NATURALIZER OUTLET
CALHOUN OUTLET CENTER
455 BELWOOD RD, STE 10
CALHOUN
GA
30701
1577
FAMOUS FOOTWEAR
GUAM PREMIUM OUTLETS
199 CHALAN SAN ANTONIO RD
TAMUNING GUAM
GU
96911
1347
FAMOUS FOOTWEAR
KAAHUMANU CENTER
275 KAAHUMANA AVENUE
KAHULUI
HI
96732
1434
FAMOUS FOOTWEAR
DOLE FACTORY STORES
#735 10 IWILEI ROAD
HONOLULU
HI
96817
1463
FAMOUS FOOTWEAR
PRINCE KUHIO MALL
730 PRINCE KUHIA PLZ
HILO
HI
96720
2373
FAMOUS FOOTWEAR
WAIKELE PREMIUM OUTLETS
94-792 LUMI' AINA  SUITE #204
WAIPAHU
HI
96797
2443
FAMOUS FOOTWEAR
KUKUI GROVE CENTER
3-2600 KAUMUALI HWY
LIHUE
HI
96766
24
FAMOUS FOOTWEAR
SOUTHDALE S.C.
5010 S.E. 14TH
DES MOINES
IA
50320
102
FAMOUS FOOTWEAR
CLOCK TOWER SQUARE
3810 UNIVERSITY AVENUE
WEST DES MOINES
IA
50265
1174
FAMOUS FOOTWEAR
CROSSROADS CENTER
219 CROSSROADS CENTER
WATERLOO
IA
50702
1290
FAMOUS FOOTWEAR
MALL OF THE BLUFFS
1751 MADISON AVE #526
COUNCIL BLUFFS
IA
51503
1508
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
509 TANGER DRIVE
WILLIAMSBURG
IA
52361
1707
FAMOUS FOOTWEAR
324 FACTORY OUTLET DR
324 FACTORY OUTLET DR # 1  BOX 115
STORY CITY
IA
50248
1795
FAMOUS FOOTWEAR
NORTHLAND SQUARE
303-367 COLLINS RD N.E.
CEDAR RAPIDS
IA
52404

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)
   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2241
FAMOUS FOOTWEAR
CORAL RIDGE MALL
2797 COMMERCE DR SHOP 200 NWC I-80 AND HWY 965
CORALVILLE
IA
52241
2273
FAMOUS FOOTWEAR
HAYMARKET MALL
5820 AURORA AVE
DES MOINES
IA
50310
2292
FAMOUS FOOTWEAR
ASHBURY PLAZA
2495 NW ARTERIAL
DUBUQUE
IA
52002
2326
FAMOUS FOOTWEAR
BLACKHAWK VILLAGE
5911 UNIVERSITY AVE
CEDAR FALLS
IA
50613
2417
FAMOUS FOOTWEAR
QUINCY PLAZA
1135 NORTH QUINCY AVENUE SUITE # 94
OTTUMWA
IA
52501
2461
FAMOUS FOOTWEAR
SOUTHERN HILLS MALL
4400 SERGEANT RD. SPC # 406
SIOUX CITY
IA
51106
2470
FAMOUS FOOTWEAR
WILLOW CREEK CROSSING
544 INDIANHEAL DRIVE
MASON CITY
IA
50401
2764
FAMOUS FOOTWEAR
METRO CROSSING
3606 METRO DROVE  SUITE 300
COUNCIL BLUFFS
IA
51501
2786
FAMOUS FOOTWEAR
EDGEWOOD ROAD RETAIL  CENTER
3620 EDGEWOOD ROAD SW  # 900
CEDAR RAPIDS
IA
52404
3003
WAREHOUSE SHOES
CEDAR RAPIDS
4100 1ST AVE. NE
CEDAR RAPIDS
IA
52402
3019
WAREHOUSE SHOES
DAVENPORT
320 KIMBERLY RD., SPACE 3000
DAVENPORT
IA
52806
948
FAMOUS FOOTWEAR
QUALITY FACTORY OUTLET
6824 SO. EISENMAN ROAD
BOISE
ID
83716
1667
FAMOUS FOOTWEAR
BOISE TOWNE PLAZA
518 N. MILWAUKEE BLVD
BOISE
ID
83704
2123
FAMOUS FOOTWEAR
FAMILY CENTER AT MERIDIAN
3455 E. FAIRVIEW AVE.
MERIDIAN
ID
83616
2124
FAMOUS FOOTWEAR
AMMON TOWN CENTER
2053 SOUTH 25TH EAST
AMMON
ID
83401
2146
FAMOUS FOOTWEAR
CANYON PARK EAST
2016 BRIDGEVIEW BLVD
TWIN FALLS
ID
83301
2516
FAMOUS FOOTWEAR
TREASURE VALLEY MARKETPLACE
16490 N. MARKETPLACE BLVD.
NAMPA
ID
83687
2552
FAMOUS FOOTWEAR
NEZ PERCE PLAZA
2632 NEZ PERCE DRIVE
LEWISTON
ID
83501
2578
FAMOUS FOOTWEAR
PALOUSE MALL
2010 W PULLMAN ROAD
MOSCOW
ID
83843
2588
FAMOUS FOOTWEAR
POCATELLO SQUARE
1776 HURLEY DRIVE
POCATELLO
ID
83202

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2671
FACTORY BRAND SHOES
NORTH IDAHO OUTLETS
4226 W. RIVERBEND AVENUE
POST FALLS
ID
83854
64
FAMOUS FOOTWEAR
DEERBROOK MALL
130C SOUTH WAUKEGAN ROAD
DEERFIELD
IL
60015
66
FAMOUS FOOTWEAR
WINSTON PARK PLAZA S.C.
1180 WINSTON PLAZA
MELROSE PARK
IL
60160
71
FAMOUS FOOTWEAR
LOEHMANN'S PLAZA
138 TOWNCENTER
MATTESON
IL
60443
87
FAMOUS FOOTWEAR
STREET STORE CITY
2731-2733 N. CLARK STREET
CHICAGO
IL
60614
113
FAMOUS FOOTWEAR
SALEM MALL
5555 S. BRAINARD ROAD
COUNTRYSIDE
IL
60525
137
FAMOUS FOOTWEAR
NAPER WEST PLAZA
560 SOUTH ROUTE #59
NAPERVILLE
IL
60565
169
FAMOUS FOOTWEAR
SPRING HILL FASHION MALL
890 WEST MAIN
WEST DUNDEE
IL
60118
181
FAMOUS FOOTWEAR
LAKE VIEW PLAZA
15818 LA GRANGE
ORLAND PARK
IL
60462
190
FAMOUS FOOTWEAR
FOREST PLAZA
6470 EAST STATE STREET
ROCKFORD
IL
61108
235
FAMOUS FOOTWEAR
VILLAGE GREEN S.C.
535 BUSSE ROAD
PARK RIDGE
IL
60068
245
FAMOUS FOOTWEAR
RIVERCREST CENTRE
4853 WEST CAL SAG ROAD
CRESTWOOD
IL
60445
256
FAMOUS FOOTWEAR
RIVERPOINT S.C.
1730 WEST FULLERTON AVE.
CHICAGO
IL
60614
263
FAMOUS FOOTWEAR
GURNEE MILLS
6170 W. GRAND AVE-#597
GURNEE
IL
60031
559
FAMOUS FOOTWEAR
PRIME OUTLETS
11800 FACTORY SHOPES BLVD
HUNTLEY
IL
60142
568
FAMOUS FOOTWEAR
WOODFIELD VILLAGE GREEN
1570 EAST GOLF ROAD
SCHAUMBURG
IL
60173
933
FAMOUS FOOTWEAR
DANADA SQUARE WEST S.C.
132 DANADA SQUARE WEST
WHEATON
IL
60187
982
FAMOUS FOOTWEAR
CARLYLE PLAZA
658 CARLYLE AVENUE
BELLEVILLE
IL
62221
1060
FAMOUS FOOTWEAR
CHARLESTOWNE MALL
3800 E. MAIN STREET
ST. CHARLES
IL
60174
1081
FAMOUS FOOTWEAR
TARGET CENTER
381 W. IRVING PARK RD.
WOOD DALE
IL
60191
1082
FAMOUS FOOTWEAR
TWO RIVERS PLAZA
1122 WEST BOUGHTON
BOLINGBROOK
IL
60440

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
1099
FAMOUS FOOTWEAR
FORD CITY SC-NO.MALL#1930
7601 S.CICERO AVENUE
CHICAGO
IL
60652
1100
FAMOUS FOOTWEAR
VILLAGE CROSSING
7137 CENTRAL AVENUE
SKOKIE
IL
60077
1146
FAMOUS FOOTWEAR
TUSCOLA FACTORY OUTLET
TUSCOLA BLVD STE E7
TUSCOLA
IL
61953
1186
FAMOUS FOOTWEAR
SOUTHPARK MALL
4500  16TH STREET
MOLINE
IL
61265
1257
FAMOUS FOOTWEAR
TINLEY PARK PLAZA
16003 HARLEM AVE
TINLEY PARK
IL
60477
1259
SUPERMARKET OF SHOES
 
581 BELT LINE ROAD
COLLINSVILLE
IL
62234
1288
SUPERMARKET OF SHOES
ALTON SQUARE
122 ALTON SQUARE
ALTON
IL
62002
1525
FAMOUS FOOTWEAR
DEER GROVE CENTER
663 E. DUNDEE ROAD
PALATINE
IL
60067
1542
FAMOUS FOOTWEAR
EDWARDSVILLE MARKET PLACE
2306 TROY ROAD
EDWARDSVILLE
IL
62025
1565
FAMOUS FOOTWEAR
NORTHFIELD SQUARE
1600 N STATE SUITE 410
BOURBONNAIS
IL
60914
1614
FAMOUS FOOTWEAR
BLOOMINGDALE COURT
342-W ARMY TRAIL-SP 110
BLOOMINGDALE
IL
60108
1629
FAMOUS FOOTWEAR
WINDPOINT RETAIL CENTER
345 N. RANDALL ROAD
BATAVIA
IL
60510
1678
FAMOUS FOOTWEAR
QUINCY MALL
3323 QUINCY MALL
QUINCY
IL
62301
1796
FAMOUS FOOTWEAR
OAKLAND PLACE
2451 SYCAMORE RD
DE KALB
IL
60115
2032
FAMOUS FOOTWEAR
WILLOW CREEK
2221 WILLOW ROAD
GLENVIEW
IL
60025
2056
FAMOUS FOOTWEAR
JOLIET COMMONS
2731 PLAINFIELD RD
JOLIET
IL
60435
2097
FAMOUS FOOTWEAR
GURNEE TOWNE CENTRE
6931 GRAND AVENUE
GURNEE
IL
60031
2169
FAMOUS FOOTWEAR
LONG RUN MARKETPLACE
13462 ARCHER AVE.
LEMONT
IL
60439
2260
FAMOUS FOOTWEAR
SOUTH ELGIN SJOPPING CENTER
354 RANDALL ROAD
SOUTH ELGIN
IL
60177
2261
FAMOUS FOOTWEAR
RIVER FOREST T.C.
7231 W LAKE ST
RIVER FOREST
IL
60305

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #     TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS     CITY   STATE   ZIP/MAIL CODE
2262
FAMOUS FOOTWEAR
TARGET CENTER
2362 RICHMOND RD
MCHENRY
IL
60050
2267
FAMOUS FOOTWEAR
LINCOLN PLACE
5945 N ILLINOIS AVE
FAIRVIEW HEIGHTS
IL
62208
2270
FAMOUS FOOTWEAR
LINCOLN VILLAGE
6201 N MCCORMICK
CHICAGO
IL
60659
2283
FAMOUS FOOTWEAR
OSWEGO COMMONS
3040 US HWY 34
OSWEGO
IL
60543
2285
FACTORY BRAND SHOES
CHICAGO PREMIUM OUTLETS
1650 PREMIUM OUTLETS BLVD. SUITE 271
AURORA
IL
60504
2344
FAMOUS FOOTWEAR
WOODCREEK SHOPPING CENTER
730 S RANDALL ROAD
ALGONQUIN
IL
60102
2400
FAMOUS FOOTWEAR
PERU MALL
3940 ILLINOIS ROUTE 251  SUITE H-1
PERU
IL
61354
2419
FAMOUS FOOTWEAR
NORTH AURORA TOWNE CENTRE
1760 ORCHARD GAREWAY BLVD.
NORTH AURORA
IL
60542
2447
FAMOUS FOOTWEAR
SUTTON PARK SHOPPING CENTER
1021 S. SUTTON ROAD
STREAMWOOD
IL
60107
2451
FAMOUS FOOTWEAR
PRAIRIE CROSSING
11125 W LINCOLN HIGHWAY
FRANKFORT
IL
60423
2532
FAMOUS FOOTWEAR
CALUMET CENTER
450 RIVER OAKS WEST
CALUMET CITY
IL
60409
2539
FAMOUS FOOTWEAR
HICKORY POINT MALL
1110 HICKORY POINT MALL
FORSYTH
IL
62535
2541
FAMOUS FOOTWEAR
WASHINGTON PARK PLAZA
17820 HALSTEAD STREET
HOMEWOOD
IL
60430
2566
FAMOUS FOOTWEAR
ROMEOVILLE SHOPPING CENTER
351 S. WEBER ROAD
ROMEOVILLE
IL
60446
2705
FAMOUS FOOTWEAR
ORCHARD LANE MARKET PLACE
272 E. ROLLINS ROAD
ROUND LAKE BEACH
IL
60073
2708
FAMOUS FOOTWEAR
BELLEVILLE CROSSINGS
5701 BELLEVILLE CROSSINGS
BELLEVILLE  (HIGHER SPEC DIST RATE)
IL
62226
2733
FAMOUS FOOTWEAR
KENDALL MARKETPLACE
871 ERICA LANE
YORKVILLE
IL
60560

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #     TRADE/STORE NAME     MALL/SHOPPING CENTER     ADDRESS      CITY   STATE   ZIP/MAIL CODE
2793
FAMOUS FOOTWEAR
MACHESNEY CROSSINGS
1041 WEST LANE ROAD
MACHESNEY
IL
61115
2801
FAMOUS FOOTWEAR
MOUNT PROSPECT PLAZA
1411 RAND ROAD
MOUNT PROSPECT
IL
60056
2900
FAMOUS FOOTWEAR
LINCOLN SQUARE
901 WEST MORTON # 115-116
JACKSONVILLE
IL
62650
3013
FAMOUS FOOTWEAR
CHAMPAIGN
2013 N. PROSPECT AVE.
CHAMPAIGN
IL
61821
3018
FAMOUS FOOTWEAR
MOLINE
4425 16TH STREET
MOLINE
IL
61265
3020
FAMOUS FOOTWEAR
PEORIA
4929 N. HAMILTON RD.
PEORIA
IL
61614
3023
FAMOUS FOOTWEAR
LAKE ZURICH
475 S. RAND RD.
LAKE ZURICH
IL
60047
3025
FAMOUS FOOTWEAR
CRYSTAL LAKE
5260 NORTHWEST HWY UNIT B
CRYSTAL LAKE
IL
60014
90835
NATURALIZER
ORLAND SQUARE
556 ORLAND SQUARE
ORLAND PARK
IL
60462
90849
NATURALIZER
 
28 EAST RANDOLPH STREET #30
CHICAGO
IL
60601
90888
NATURALIZER
ST. CLAIR SQUARE
294 ST CLAIR SQUARE
FAIRVIEW HEIGHTS
IL
62208
96760
NATURALIZER OUTLET
CHICAGO PREMIUM OUTLETS
1650 PREMIUM OUTLETS BLVD. SUITE 1117
AURORA
IL
60504
96761
NATURALIZER OUTLET
GURNEE MILLS
6170 W GRAND AVENUE, SPACE 753
GURNEE
IL
60031
99902
FRANCO SARTO
WOODFIELD MALL
5 WOODFIELD MALL E-317
SCHAUMBURG
IL
60173
26
FAMOUS FOOTWEAR
PRIME OUTLETS @EDINBURGH
11850 NE. EXECUTIVE DRIVE
EDINBURGH
IN
46124
1177
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
357 TANGER BLVD STE 211
SEYMOUR
IN
47274
1331
FAMOUS FOOTWEAR
HIGHLAND TOWNE CENTER
10423 INDIANAPOLIS BLVD, STE #3
HIGHLAND
IN
46322
1548
FAMOUS FOOTWEAR
PRIME @MICHIGAN CITY
817 LIGHTHOUSE PL-#817
MICHIGAN CITY
IN
46360


 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS       CITY   STATE   ZIP/MAIL CODE
1550
FAMOUS FOOTWEAR
PRIME OUTLETS @ FREEMONT
6245 N. OLD 27 STE B30
FREMONT
IN
46737
2076
FAMOUS FOOTWEAR
PLAZA EAST
201 N. GREEN RIVER RD.
EVANSVILLE
IN
47715
2491
FAMOUS FOOTWEAR
VALPARISO WALK
91 SILHAVEY ROAD
VALPARISO
IN
46383
2562
FAMOUS FOOTWEAR
LAFAYETTE PAVILLIONS
100 SOUTH CREASY LANE
LAFAYETTE
IN
47905
2840
FAMOUS FOOTWEAR
ERSKINE VILLAGE
1290 E IRELAND ROAD SUITE G-2
SOUTH BEND
IN
46601
2870
FAMOUS FOOTWEAR
FISHERS CORNER II
11781 COMMERCIAL DRIVE
FISHERS
IN
46038
2876
FAMOUS FOOTWEAR
BROWNSBURG STATION
578 W NORTHFIELD DRIVE # 1040
BROWNSBURG
IN
46112
2877
FAMOUS FOOTWEAR
APPLEWOOD CENTRE
5527 SCATTERFIELD ROAD
ANDERSON
IN
46013
2878
FAMOUS FOOTWEAR
GLENDALE TOWNE CENTER
6101 N KEYSTONE AVENUE
INDIANAPOLIS
IN
46220
2934
FAMOUS FOOTWEAR
GREENDALE CENTRE
745 US HIGHWAY 31 N SUITE D BUILDING B
GREENWOOD
IN
46142
2935
FAMOUS FOOTWEAR
TRADERS POINT
6010 W 86TH STREET  SUITE 112
INDIANAPOLIS
IN
46278
2952
FAMOUS FOOTWEAR
ORCHARD CROSSINGS
1034 THOMAS ROAD # 105
FORT WAYNE
IN
46804
91960
NATURALIZER
UNIVERSITY PARK MALL
6501 NORTH GRAPE ROAD, SUITE 108
MISHAWAKA
IN
46545
93499
NATURALIZER
76 EASTLAND SHOPPING CENTER
800 NORTH GREEN RIVER ROAD, STE 59
EVANSVILLE
IN
47715
96728
NATURALIZER OUTLET
LIGHTHOUSE PLACE PREMIUM OUTLETS
809 LIGHTHOUSE PLACE, SP. H-090
MICHIGAN CITY
IN
46360
51
FAMOUS FOOTWEAR
TWIN LAKES S.C.
1921 WEST 21ST STREET
WICHITA
KS
67203
183
FAMOUS FOOTWEAR
EASTGATE MALL
8023 E. KELLOGG
WICHITA
KS
67207
572
FAMOUS FOOTWEAR
WHITES FACTORY OUTLET CTR
1115 WHITE AVENUE
COLBY
KS
67701
1005
FAMOUS FOOTWEAR
WESTGATE MARKET
6720 W. KELLOG STE 250
WICHITA
KS
67202
1155
FAMOUS FOOTWEAR
GREAT MALL OF GREAT PLAIN
20405 W 151 ST
OLATHE
KS
66061

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS     CITY   STATE   ZIP/MAIL CODE
1363
FAMOUS FOOTWEAR
HUTCHINSON MALL
1500 E. 11TH ST. STE 6GA
HUTCHINSON
KS
67501
1440
FAMOUS FOOTWEAR
GREAT MALL OF THE GRT PLN
20151 W 151 ST-
OLATHE
KS
66061
1489
FAMOUS FOOTWEAR
CENTRAL MALL
137 CENTRAL MALL STE 137
SALINA
KS
67401
1490
FAMOUS FOOTWEAR
NEWTON FACTORY OUTLET
SOUTHEAST 36 ST STE 106
NEWTON
KS
67114
1538
FAMOUS FOOTWEAR
119TH & METCALF
11625 METCALF AVE STE 100
OVERLAND PARK
KS
66205
1628
FAMOUS FOOTWEAR
MERRIAM TOWN CENTER
5824 ANTIOCH ROAD
MERRIAM
KS
66202
1653
FAMOUS FOOTWEAR
SHAWNEE STATION
15410 SHAWNEE MISSION PKY
SHAWNEE
KS
66216
2130
FAMOUS FOOTWEAR
NORTHRIDGE PLAZA
15420 W. 119TH STREET
OLATHE
KS
66062
2162
FAMOUS FOOTWEAR
PINE RIDGE PLAZA
3231 SOUTH IOWA ST.
LAWRENCE
KS
66044
2266
FAMOUS FOOTWEAR
WEST RIDGE MALL
1801 SW WANAMAKER ROAD
TOPEKA
KS
66614
2638
FAMOUS FOOTWEAR
TOWNE EAST SQUARE
7700 E KELLOGG  SUITE 934
WICHITA
KS
67207
2639
FAMOUS FOOTWEAR
TOWNE WEST SQUARE
4600 KELLOGG SPACE Q09A
WICHITA
KS
67209
93381
NATURALIZER
OAK PARK SHOPPING CENTER
11239 WEST 95TH STREET
OVERLAND PARK
KS
66214
1219
FAMOUS FOOTWEAR
NEWPORT S.C.
1771A MONMOUTH STREET
NEWPORT
KY
41071
2389
FAMOUS FOOTWEAR
DRY RIDGE OUTLET CENTER
1100 FASHION RIDGE ROAD
DRY RIDGE
KY
41035
2497
FAMOUS FOOTWEAR
CRESTVIEW HILLS TOWNE CENTER
2821 TOWN CENTER BLVD
CRESTVIEW HILLS
KY
41017
401
FAMOUS FOOTWEAR
ELMWOOD PLAZA
1200 SOUTH CLEARVIEW  SUITE 1220
NEW ORLEANS
LA
70123
864
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
2200 TANGER BLVD #125
GONZALES
LA
70737
93493
NATURALIZER
LAKESIDE SHOPPING CENTER
3301 VETERANS BLVD, SPACE 43
METAIRIE
LA
70002
96789
NATURALIZER OUTLET
TANGER FACTORY OUTLET CENTER
2400 TANGER BLVD., SUITE 146
GONZALES
LA
70737

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS      CITY   STATE   ZIP/MAIL CODE
551
FAMOUS FOOTWEAR
SEARSTOWN MALL
100 COMMERCIAL ROAD
LEOMINSTER
MA
01453
1590
FAMOUS FOOTWEAR
PRIME OUTLETS @ LEE
50 WATER STREET-STE G340
LEE
MA
01238
1622
FAMOUS FOOTWEAR
WRENTHAM PREMIUM OUTLETS
1 PREMIUM OUTLETS #320
WRENTHAM
MA
02093
1687
FAMOUS FOOTWEAR
SILVER CITY GALLERIA
2 GALLERIA MALL DR-#3214
TAUNTON
MA
02780
1688
FAMOUS FOOTWEAR
HANOVER MALL
1775 WASHINGTON STREET
HANOVER
MA
02339
1713
FAMOUS FOOTWEAR
MEADOW GLEN MALL
3850 MYSTIC VALLEY PKWY
MEDFORD
MA
02155
1714
FAMOUS FOOTWEAR
LIBERTY TREE MALL
100 INDEPENDENCE WAY
DANVERS
MA
01923
1734
FAMOUS FOOTWEAR
SQUARE ONE MALL
1277 BROADWAY DRIVE
SAUGUS
MA
01906
1735
FAMOUS FOOTWEAR
AUBURN MALL
385 SOUTHBRIDGE ST
AUBURN
MA
01501
2009
FAMOUS FOOTWEAR
INDEPENDENCE MALL
101 INDEPENDENCE WAY
KINGSTON
MA
02364
2025
FAMOUS FOOTWEAR
CENTER AT HOBBS BROOK
110 CHARLETON RD. #1
STURBRIDGE
MA
01586
2072
FAMOUS FOOTWEAR
THE LOOP
90 PLEASANT VALLEY ST.
METHUEN
MA
01844
2141
FAMOUS FOOTWEAR
SHOPPES @ BLACKSTONE
70 WORCESTER PROVIDENCE
MILLBURY
MA
01527
2177
FAMOUS FOOTWEAR
GATEWAY CENTER
13 MYSTIC VIEW ROAD
EVERETT
MA
02149
2179
FAMOUS FOOTWEAR
REDSTONE SHOPPING CENTER
99 B MAIN STREET
STONEHORN
MA
02180
2218
FAMOUS FOOTWEAR
SEEKONK SQUARE
7 COMMERCE WAY
SEEKONK
MA
02771
2388
FAMOUS FOOTWEAR
MOUNTAIN FARMS
325 RUSSELL STREET
HADLEY
MA
01035
2402
FAMOUS FOOTWEAR
SAUGUS PLAZA
335 BROADWAY  UNIT # 7
SAUGUS
MA
01906
2404
FAMOUS FOOTWEAR
CHELMSFORD MALL
265 CHELMSFORD STREET
CHELMSFORD
MA
01824
2440
FAMOUS FOOTWEAR
SHERWOOD PLAZA
1298 WORCESTER ROAD  (ROUTE 9)
NATICK
MA
01760
2489
FAMOUS FOOTWEAR
SOUTH BAY CENTER
1102 MASSACHUSETTS AVENUE
BOSTON
MA
02125
2503
FAMOUS FOOTWEAR
MANSFIELD CROSSONGS
280 SCHOOL STREET  SUITE J-340
MANSFIELD
MA
02048
2558
FAMOUS FOOTWEAR
WAREHAM CROSSING
2421 CRANBERRY HIGHWAY # 436
WAREHAM
MA
02571

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2620
FAMOUS FOOTWEAR
RIVERDALE SHOPS
935 RIVERDALE STREET  BLDG. D-100
WEST SPRINGFIELD
MA
01089
2628
FAMOUS FOOTWEAR
FRANKLIN VILLAGE SHOPPING CENTER
95 FRANKLIN VILLAGE DRIVE
FRANKLIN
MA
02038
2912
FAMOUS FOOTWEAR
ARSENAL MALL
485 ARSENAL STREET SUITE B9-10
WATERTOWN
MA
02472
96772
NATURALIZER OUTLET
WRENTHAM VILLAGE PREMIUM OUTLETS
#1 PREMIUM OUTLET BLVD., SUITE 180
WRENTHAM
MA
02093
99174
BROWN SHOE CLOSET
WRENTHAM VILLAGE PREMIUM OUTLETS
ONE PREMIUM OUTLET BLVD, SUITE 690
WRENTHAM
MA
02093
1282
FAMOUS FOOTWEAR
ASPEN HILL SHOPPING CNTR
13513 CONNETICUT AVE
WHEATON
MD
20902
1431
FAMOUS FOOTWEAR
OCEAN CITY
12741 OCEAN GATEWAY
OCEAN CITY
MD
21842
1574
FAMOUS FOOTWEAR
PRIME @ PERRYVILLE
68 HEATER LN-STE A006
PERRYVILLE
MD
21903
1674
FAMOUS FOOTWEAR
PRIME OUTLETS @HAGERSTOWN
525 PRIME OUTLETS BLVD
HAGERSTOWN
MD
21740
1717
FAMOUS FOOTWEAR
AVENUE AT WHITE MARSH
8129A HONEYGO BLVD.
WHITE MARSH
MD
21236
1754
FAMOUS FOOTWEAR
CENTRE AT HAGERSTOWN
17670 GARLAND GROH BLVD
HAGERSTOWN
MD
21740
2045
FACTORY BRAND SHOES
ARUNDEL MILLS
7600 CLARK ROAD, SPACE #528
HANOVER
MD
21076
2136
FAMOUS FOOTWEAR
CHESAPEAKE VILLAGE
417 OUTLET CENTER DRIVE
QUEENSTOWN
MD
21658
2149
FAMOUS FOOTWEAR
BOWLE TOWN CENTER
15651 EMERALD WAY
BOWIE
MD
20716
2561
FAMOUS FOOTWEAR
LAUREL SHOPPING CENTER
357 MONTROST AVENUE
LAUREL
MD
20707
2580
FAMOUS FOOTWEAR
LA PLATA PLAZA
50 SHINNING WILLOW WAY
LA PLATA
MD
20646
2698
FAMOUS FOOTWEAR
SAN SOUCI PLAZA
22599 MAC ARTHUR BLVD.  SPACE 370
CALIFORNIA
MD
20619
2699
FAMOUS FOOTWEAR
WALDORF MARKETPLACE
2992 WALDORF MARKETPLACE SUITE 1
WALDORF
MD
20603

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2720
FAMOUS FOOTWEAR
GREENWAY SHOPPING CENTER
7595 GREENBELT ROAD, SPACE 23
GREENBELT
MD
20770
2721
FAMOUS FOOTWEAR
CENTRE @ GLEN BURNIE
6711 RITCHIE HWY  SUITE 263
GLEN BURNIE
MD
21061
2724
FAMOUS FOOTWEAR
WATERSIDE VILLAGE
28531 MARLBORO AVENUE
EASTON
MD
21601
2757
FAMOUS FOOTWEAR
THE CENTRE @ GOLDEN RING
8652 B PULASKI HWY.
BALTIMORE
MD
21237
2758
FAMOUS FOOTWEAR
LANSDOWNE STATION
3541 WASHINGTON BLVD. # 110
BALTIMORE
MD
21227
2766
FAMOUS FOOTWEAR
LOCKWOOD PLACE
600 E. PRATT STREET
BALTIMORE
MD
21202
2767
FAMOUS FOOTWEAR
FESTIVAL @ RIVA ROAD
2315 E FOREST DRIVE
ANNAPOLIS
MD
21401
2815
FAMOUS FOOTWEAR
PENN MAR SHOPPING CENTER
3120 DONNELL DRIVE
FORESTVILLE
MD
20747
2879
FAMOUS FOOTWEAR
PARK PLAZA
550 GOVERNOR RITCHIE HIGHWAY # H
SEVERNA PARK
MD
21146
2913
FAMOUS FOOTWEAR
FESTIVAL @ BEL AIR
5 BEL AIR SOUTH PARKWAY, SUITE 403
BEL AIR
MD
21015
91540
NATURALIZER
COLUMBIA MALL
10300 LITTLE PATUXENT PKWY, SPACE 2070
COLUMBIA
MD
21044
91548
NATURALIZER
ST CHARLES TOWNE CENTER
11110 MALL CIRCLE, PO BOX 6137, STE. 2056
WALDORF
MD
20603
91555
NATURALIZER
OWINGS MILL TOWN CENTER
10300 MILL RUN CIRCLE
OWINGS MILLS
MD
21117
96792
NATURALIZER OUTLET
PRIME OUTLETS AT HAGERSTOWN
745 PRIME OUTLETS BLVD.
HAGERSTOWN
MD
21740
286
FAMOUS FOOTWEAR
MAINE CROSSING
330 CLARKS POND PKWY #630
PORTLAND
ME
04106
2026
FAMOUS FOOTWEAR
AUGUSTA MARKETPLACE
2B STEPHAN KING DRIVE
AUGUSTA
ME
04330
2472
FAMOUS FOOTWEAR
BNAGOR PARKADE
496 STILLWATER AVENUE
BANGOR
ME
04401
2490
FAMOUS FOOTWEAR
THE SHOPS @ BIDDEFORD CROSSINGS
418 MARINER WAY
BIDDEFORD
ME
04005

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2599
FAMOUS FOOTWEAR
MERRYMEETING PLAZA
147 BATH ROAD
BRUNSWICK
ME
04011
2781
FAMOUS FOOTWEAR
TURNER STREET CENTER
105 MOUNT AUBURN AVE. # 1
AUBURN
ME
04010
96709
NATURALIZER OUTLET
THE MAINE OUTLET
345 US RT. 1, BOX 23
KITTERY
ME
03904
98
FAMOUS FOOTWEAR
PRIME OULLETS @BIRCH RUN
12085 SOUTH BEYER ROAD
BIRCH RUN
MI
48415
219
FAMOUS FOOTWEAR
HAMPTON VILLAGE CENTRE
2883 S. ROCHESTER ROAD
ROCHESTER HILLS
MI
48307
244
FAMOUS FOOTWEAR
OAK VALLEY CENTRE
2915 OAK VALLEY DRIVE
ANN ARBOR
MI
48103
249
FAMOUS FOOTWEAR
HORIZON OUTLET CENTER
14500 LA PLAISANCE ROAD
MONROE
MI
48161
251
FAMOUS FOOTWEAR
HORIZON OUTLET CENTER
12330 JAMES ST. SUITE H90
HOLLAND
MI
49424
255
FAMOUS FOOTWEAR
MILLENNIUM PARK
13300 MIDDLEBELT
LIVONIA
MI
48154
521
FAMOUS FOOTWEAR
HORIZON OUTLET CENTER
1661 RANGE RD. #B90
PORT HURON
MI
48074
960
FAMOUS FOOTWEAR
EDGEWOOD TOWNE CENTER
438 E EDGEWOOD BLVD #D107
LANSING
MI
48911
1190
FAMOUS FOOTWEAR
WEST OAKS II
43514 W. OAKS DRIVE
NOVI
MI
48377
1191
FAMOUS FOOTWEAR
NEW TOWNE CENTRE
44590 FORD ROAD
CANTON
MI
48187
1197
FAMOUS FOOTWEAR
JACKSON CROSSING
1170 JACKSON CROSSING
JACKSON
MI
49202
1210
FAMOUS FOOTWEAR
SEARS LINCOLN PARK CTR
1730 DIX
LINCOLN PARK
MI
48146
1243
FAMOUS FOOTWEAR
HALL ROAD CROSSING
13901 HALL ROAD
SHELBY
MI
48315
1270
FAMOUS FOOTWEAR
FAIRLANE MEADOWS SUITE
16001 FORD RD 131&132
DEARBORN
MI
48126
1386
FAMOUS FOOTWEAR
GRAND TRAVERSE MALL
3200 S. AIRPORT RD W.
TRAVERSE CITY
MI
49685
1436
FACTORY BRAND SHOES
KENSINGTON FACTORY
1475 BURKHART RD-STE G180
HOWELL
MI
48843
1595
FAMOUS FOOTWEAR
COURTLAND CENTER
4190 E.COURT ST-SP #721
BURTON
MI
48509
1619
FAMOUS FOOTWEAR
CROSSROADS MALL
6650 S. WESTNEDGE AVE
PORTAGE
MI
49002

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME     MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
1640
FAMOUS FOOTWEAR
GREAT LAKES CROSSING
4178 BALDWIN ROAD #404
AUBURN HILLS
MI
48326
1657
FAMOUS FOOTWEAR
WEST VALLEY SHOPPING CENTER
3365 TITTABAWASSEE ROAD
SAGINAW
MI
48604
1742
FAMOUS FOOTWEAR
ARBORLAND CENTER
3567 WASHTENAW AVE
ANN ARBOR
MI
48104
2041
FACTORY BRAND SHOES
HORIZON OUTLET
3835 MARKETPLACE CIRCLE
TRAVERSE CITY
MI
49684
2170
FAMOUS FOOTWEAR
BALDWIN COMMONS
4840 SOUTH BALDWIN RD.
 LAKEORION
MI
48359
2172
FAMOUS FOOTWEAR
THE HEIGHTS
26486 FORD ROAD
DEARBORN HEIGHTS
MI
48127
2189
FAMOUS FOOTWEAR
MIDLAND PLACE
905 JOE MANN BLVD
MIDLAND
MI
48642
2202
FAMOUS FOOTWEAR
CLINTON POINT S.C.
33830  S. GRATIOT AVE.
CLINTON TOWNSHIP
MI
48035
2203
FAMOUS FOOTWEAR
MIDTOWN CENTER
1213 COOLIDGE HIGHWAY
TROY
MI
48084
2296
FAMOUS FOOTWEAR
ROGER PLAZA
1075 28TH STREET SW
WYOMING
MI
49509
2357
FAMOUS FOOTWEAR
CHESTERFIELD VILLAGE SQUARE
51530 GRATIOT AVENUE
CHESTERFIELD TWNSHP
MI
48051
2458
FAMOUS FOOTWEAR
GENESEE VALLEY CENTER
3227 S. LINDEN ROAD
FLINT TOWNSHIP
MI
48507
2530
FAMOUS FOOTWEAR
FAIRLANE SHOPPING CENTER
3340 FAIRLANE DRIVE
ALLEN PARK
MI
48101
2641
FACTORY BRAND SHOES
THE ORCHARDS MALL
1800 PIPESTONE RD STE 444
BENTON HARBOR
MI
49022
2707
FAMOUS FOOTWEAR
SOUTH BRANCH SHOPPING CENTER
1776 DEMILLE ROAD
LAPEER
MI
48446
2734
FACTORY BRAND SHOES
TANGER FACTORY OUTLET
2990 COOK RD-SUITE 106 -107
WEST BRANCH
MI
48661
2745
FAMOUS FOOTWEAR
CROSSROADS VILLAGE
47210 MICHIGAN AVENUE
CANTON
MI
48188

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2970
FAMOUS FOOTWEAR
HARPER VILLAGE SHOPPING CENTER
12765 HAPER VILLAGE DR  # 105
BATTLE CREEK
MI
49014
90623
NATURALIZER
LAKESIDE MALL
14600 LAKESIDE CIRCLE
STERLING HEIGHTS
MI
48313
90639
NATURALIZER
TWELVE OAKS MALL
27230 NOVI ROAD SPACE D 169
NOVI
MI
48377
96750
NATURALIZER OUTLET
KENSINGTON VALLEY FACTORY SHOPS
1475 NORTH BURKHART RD., SPACE E-130
HOWELL
MI
48843
96752
NATURALIZER OUTLET
PRIME OUTLETS AT BIRCH RUN
12150 SOUTH BEYER RD., F-30
BIRCH RUN
MI
48415
96776
NATURALIZER OUTLET
GREAT LAKES CROSSING
4108 BALDWIN ROAD, SPACE 325
AUBURN HILLS
MI
48326
8
FAMOUS FOOTWEAR
WOODBURY VILLAGE S.C.
7150 VALLEY CREEK #208
WOODBURY
MN
55129
29
FAMOUS FOOTWEAR
CROSSROADS S. C.
1201 S. BROADWAY
ROCHESTER
MN
55904
40
FAMOUS FOOTWEAR
SOUTHVIEW SQUARE S.C.
1867 SOUTH ROBERT STREET
ST. PAUL
MN
55118
45
FAMOUS FOOTWEAR
HIGHLAND S.C.
2022 FORD PARKWAY
HIGHLAND PARK
MN
55116
48
FAMOUS FOOTWEAR
HAR MAR MALL
2100 N SNELLING AVE
ROSEVILLE
MN
55113
291
FAMOUS FOOTWEAR
SUN RAY SHOPPING CENTER
2121 HUDSON ROAD
ST. PAUL
MN
55119
292
FAMOUS FOOTWEAR
ROCKFORD ROAD PLAZA
4190 VINEWOOD LANE
PLYMOUTH
MN
55442
561
FAMOUS FOOTWEAR
NORTH BRANCH OUTLETS
38573 TANGER DRIVE #114
NORTH BRANCH
MN
55056
566
FAMOUS FOOTWEAR
DIVISION PLACE
2826 W DIVISION STREET
ST. CLOUD
MN
56301
1374
FAMOUS FOOTWEAR
STARLITE CENTER
7641 WEST BROADWAY
BROOKLYN PARK
MN
55428
1408
FAMOUS FOOTWEAR
ELK PARK CENTER
19174 FREEPORT AVENUE
ELK RIVER
MN
55330
1409
FAMOUS FOOTWEAR
MAPLE GROVE CROSSING
8076 WEDGEWOOD LANE
MAPLE GROVE
MN
55369

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
1530
FAMOUS FOOTWEAR
MINNEAPOLIS FACTORY SHOPS
6415 LABEAUX AVE NE
ALBERTVILLE
MN
55301
1545
FAMOUS FOOTWEAR
EAGAN PROMENADE
1287 PROMENADE PLACE #4
EAGAN
MN
55121
1554
FAMOUS FOOTWEAR
MEDFORD OUTLET CENTER
6750 W.FRONTAGE ROAD
MEDFORD
MN
55049
1652
FAMOUS FOOTWEAR
STILLWATER MARKETPLACE
1871 MARKET DR. #3
STILLWATER
MN
55082
1780
FAMOUS FOOTWEAR
VADNAIS SQUARE
947 E. COUNTY ROAD E
VADNAIS HEIGHTS
MN
55127
1794
FAMOUS FOOTWEAR
BURNSVILLE CENTER
1178 BURNSVILLE CENTER
BURNSVILLE
MN
55337
2209
FAMOUS FOOTWEAR
ROCHESTER MP
3813 MARKET PLACE DRIVE
ROCHESTER
MN
55901
2210
FAMOUS FOOTWEAR
SHAKOPEE VALLEY MALL
1593 17TH AVE EAST STE 100
SHAKOPEE
MN
55379
2271
FAMOUS FOOTWEAR
MANKATO HEIGHTS
1901 MADISON AVE
MANKATO
MN
56002
2284
FAMOUS FOOTWEAR
RIVERDALE VILLAGE
12761 RIVERDALE BLVD. NW
COON RAPIDS
MN
55448
2300
FAMOUS FOOTWEAR
FISCHER MARKET PLACE
14929 FLORENCE TR SUITE 500
APPLE VALLEY
MN
55124
2327
FAMOUS FOOTWEAR
MALL OF AMERICA
246 N. GARDEN-SPACE N246
MINNEAPOLIS
MN
55425
2342
FAMOUS FOOTWEAR
RIDGEHAVEN SHOPPING CENTER
13153 RIDGEDALE DRIVE
MINNETONKA
MN
55305
2425
FAMOUS FOOTWEAR
PAUL BUNYAN MALL
1201 PAUL BUNYAN DRIVE
BEMIDJI
MN
56601
2473
FAMOUS FOOTWEAR
FOUNTAIN PLACE
12577 CASTLEMOOR DRIVE
EDEN PRAIRIE
MN
55344
2528
FAMOUS FOOTWEAR
CRYSTAL SHOPPING CENTER
139 WILLOW BEND
CRYSTAL
MN
55428
2538
FAMOUS FOOTWEAR
QUARRY SHOPPING CENTER
1560 NEW BRIGHTON BLVD.
MINNEAPOLIS
MN
55413
2548
FAMOUS FOOTWEAR
SOUTH TOWN SHOP CENTER
7945 SOUTHTIWN CENTER  (I-494 & PENN AVE)
BLOOMINGTON
MN
55431
2602
FAMOUS FOOTWEAR
KANDI MALL
1605 S. FIRST STREET
WILLMAR
MN
56201
2616
FAMOUS FOOTWEAR
RED WING MALL
144 TYLER ROAD N SPACE C
RED WING
MN
55066

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2675
FAMOUS FOOTWEAR
NORTHTOWN MALL
398 NORTHTOWN DRIVE SUITE H-4
BLAINE
MN
55434
2704
FAMOUS FOOTWEAR
MAPLE CREEK RETAIL
1293 21ST AVENUE NW
OWATONNA
MN
55060
2866
FAMOUS FOOTWEAR
CEDAR POINT COMMONS
6515 RICHFIELD PARKWAY
RICHFIELD
MN
55423
95121
NATURALIZER
MALL OF AMERICA
SUITE 288, I-494 & HWY 77
BLOOMINGTON
MN
55425
96605
NATURALIZER OUTLET
ALBERTIVILLE MALL
6415 LEBEAUX AVE., NE, STE. A 60
ALBERTVILLE
MN
55301
96741
NATURALIZER OUTLET
MEDFORD VILLAGE FACTORY CENTER
6750 W. FRONTAGE ROAD
MEDFORD
MN
55049
96743
NATURALIZER OUTLET
NORTH BRANCH OUTLETS
38573 TANGER DR. #204
NORTH BRANCH
MN
55056
31
FAMOUS FOOTWEAR
INDEPENDENCE PLAZA
MISSOURI HY 291 & 39TH
INDEPENDENCE
MO
64055
210
FAMOUS FOOTWEAR
CREEKWOOD COMMONS
211 N.E. ENGLEWOOD ROAD
KANSAS CITY
MO
64118
264
FAMOUS FOOTWEAR
FACTORY MERCHANTS MALL
1000 PAT NASH DR. #4B
BRANSON
MO
65616
500
FAMOUS FOOTWEAR
 
4540 HIGHWAY 54  STE K2
OSAGE BEACH
MO
65065
530
FAMOUS FOOTWEAR
CENTRAL PLAZA
15329 MANCHESTER ROAD
BALLWIN
MO
63011
531
FAMOUS FOOTWEAR
KIRKWOOD COMMONS
1038 S. KIRKWOOD RD
KIRKWOOD
MO
63122
532
FAMOUS FOOTWEAR
DIEBERG-HERITAGE PLACE
12533 OLIVE BLVD.
CREVE COEUR
MO
63141
538
FAMOUS FOOTWEAR
ST. PETERS SQUARE
555 MID RIVERS MALL DRIVE
ST PETERS
MO
63376
580
FAMOUS FOOTWEAR
TENBROOK PLAZA
2100 TENBROOK ROAD
ARNOLD
MO
63010
689
FAMOUS FOOTWEAR
NORTHPARK MALL
101 RANGE LINE ROAD #350
JOPLIN
MO
64804
927
FAMOUS FOOTWEAR
FACTORY MERCHANTS BOX-D16
1000 PAT NASH DR. BLDG13
BRANSON
MO
65616
1041
FAMOUS FOOTWEAR
MAPLE VALLEY MARKETPLACE
749 MARKET STREET
FARMINGTON
MO
63640

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
1176
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
300 TANGER BLVD STE 305
BRANSON
MO
65616
1279
FAMOUS FOOTWEAR
EUREKA TOWNE CENTER
143 EUREKA TOWN CTR DR.
EUREKA
MO
63025
1366
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
2276 MID RIVERS MALL
ST. PETERS
MO
63376
1491
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
321 SO.COUNTY CENTER WAY
ST. LOUIS
MO
63129
1492
FAMOUS FOOTWEAR
CHESTERFIELD MALL
215 CHESTERFIELD MALL
CHESTERFIELD
MO
63017
1631
FAMOUS FOOTWEAR
HORIZON OUTLET CENTER
1000 WARRENTON OUTLET CTR
WARRENTON
MO
63383
1694
FAMOUS FOOTWEAR
WASHINGTON CROSSING
2080 WASHINGTON CROSSING
WASHINGTON
MO
63090
1700
FAMOUS FOOTWEAR
2020 INDUSTRIAL DRIVE
SUITE 13
LEBANON
MO
65536
1749
FAMOUS FOOTWEAR
THE SHOPS AT LAURA HILLS
2254 HIGHWAY K
O'FALLON
MO
63366
2094
FAMOUS FOOTWEAR
JAMES RIVER TOWNE CENTRE
1959 EAST INDEPENDENCE
SPRINGFIELD
MO
65804
2114
FAMOUS FOOTWEAR
GRAVOIS BLUFF SHOPPING CENTER
119-123 GRAVOIS BLUFF S.C.
FENTON
MO
63026
2115
FAMOUS FOOTWEAR
HOME DEPOT PLAZA
3883-87 MEXICO RD.
ST CHARLES
MO
63303
2116
FAMOUS FOOTWEAR
SUMMIT WOODS
1804 CHIPMAN ROAD
LEE'S SUMMIT
MO
64081
2163
FAMOUS FOOTWEAR
BARRY TOWNE SC
8401 NORTH MADISON
KANSAS CITY
MO
64151
2277
FAMOUS FOOTWEAR
WILSHIRE PLAZA
N.W. CHURCH ROAD & N. EVANSTON ROAD
KANSAS CITY
MO
64158
2318
FAMOUS FOOTWEAR
SIKESTON FACTORY STORE
100 OUTLET DRIVE   #35 AND 36
MINER
MO
63801
2355
FAMOUS FOOTWEAR
ST. LOUIS MILLS
5555 ST. LOUIS MILLS ROAD  SUITE # 282
HAZELWOOD
MO
63042
2456
FAMOUS FOOTWEAR
THE SHOPPES AT NORTH VILLAGE
5201 NORTH BELTLINE HWY, SUITE # 107
ST. JOSEPH
MO
64506
2487
FAMOUS FOOTWEAR
BELTON TOWNE CENTER
906 E. NORTH AVENUE
BELTON
MO
64012
2498
FAMOUS FOOTWEAR
PREWITT'S POINT
3924 UNIT - F, JR PREWITT PARKWAY
LAKE OZARK
MO
65049

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2527
FAMOUS FOOTWEAR
BRANSON LANDING
119 BRANSON LANDING
BRANSON
MO
65616
2549
FAMOUS FOOTWEAR
HAMPTON VILLAGE
4 HAMPTON VILLAGE PLAZA
ST. LOUIS
MO
63109
2563
FAMOUS FOOTWEAR
WENTZVILLE CROSSRAODS MARKETPLACE
1917 WENTZVILLE PARKWAY
WENTZVILLE
MO
63385
2571
FAMOUS FOOTWEAR
DARDENNE TOWN SQUARE
7959 HIGHWWAY N
DARDENNE PRAIRIE
MO
63366
2777
FAMOUS FOOTWEAR
TIFFANY SPRINGS SHOPPING CENTER
9052 N SKYVIEW AVENUE
KANSAS CITY
MO
64154
2899
FAMOUS FOOTWEAR
DIERBERGS BRENTWOOD POINTE
8522 EAGER ROAD
BRENTWOOD
MO
63144
90893
NATURALIZER
ST. LOUIS GALLERIA
2436 SAINT LOUIS GALLERIA
RICHMOND HEIGHTS
MO
63117
96759
NATURALIZER OUTLET
OSAGE BEACH PREMIUM OUTLETS
4540 HWY 54 - H-2  BOX C13
OSAGE BEACH
MO
65065
955
FACTORY BRAND SHOES
VICKSBURG FACTORY OUTLETS
4000 S.FRONTAGE RD STE126
VICKSBURG
MS
39180
1274
FACTORY BRAND SHOES
FACTORY STORES OF MS
325 LAKEWOOD DRIVE #31
BATESVILLE
MS
38606
1369
FACTORY BRAND SHOES
PRIME OUTLETS @ GULFPORT
10630 FACTORY SHOPS BLVD
GULFPORT
MS
39503
1633
FACTORY BRAND SHOES
CASINO FACTORY SHOPPES
13118 ROBINSONVILLE
TUNICA
MS
38664
2080
FAMOUS FOOTWEAR
BRIDGER PEAKS
NORTH 19TH STREET
BOZEMAN
MT
59715
2081
FAMOUS FOOTWEAR
NORTHSIDE CENTER
3315 N. MONTANA AVE
HELENA
MT
59601
2145
FAMOUS FOOTWEAR
GREAT FALLS MARKETPLACE
1601 MARKET PLACE DR, STE 25
GREAT FALLS
MT
59404
2195
FAMOUS FOOTWEAR
MARKETPLACE
2829 KING AVE WEST ,STE# B
BILLING
MT
59102
2196
FAMOUS FOOTWEAR
GRANT CREEK
3205 N RESERVE STREET SUITE A
MISSOUIA
MT
59808

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2371
FAMOUS FOOTWEAR
MOUNTAIN VIEW PLAZA
2385 N HWY 93 N.  SUITE # 1
KALISPELL
MT
59901
402
FAMOUS FOOTWEAR
BURLINGTON MFG. CENTER
2385 CORPORATION PARKWAY
BURLINGTON
NC
27215
1661
FAMOUS FOOTWEAR
CONCORD MILLS
8111 CONCORD MILLS BLVD  STE 530
CONCORD
NC
28027
1720
FAMOUS FOOTWEAR
CAROLINA OUTLET CENTER
1207 INDUSTRIAL PARK DR
SMITHFIELD
NC
27577
96712
NATURALIZER OUTLET
FACTORY STORES OF AMERICA
1026  INDUSTRIAL PARK DRIVE STE 460
SMITHFIELD
NC
27577
96795
NATURALIZER OUTLET
CONCORD MILLS
8111 CONCORD MILLS BLVD., STE. 604
CONCORD
NC
28027
2151
FAMOUS FOOTWEAR
GRAND FORKS MARKETPLACE
3711 32ND AVE., SOUTH
GRAND FORKS
ND
58206
2188
FAMOUS FOOTWEAR
WESTGATE COMMON
1500 13TH AVE., EAST SUITE C
WEST FARGO
ND
58078
2500
FAMOUS FOOTWEAR
KIRKWOOD MALL
628 KIRKWOOD
BISMARCK
ND
58504
35
FAMOUS FOOTWEAR
BRENTWOOD CROSSINGS
7893 S 83RD ST
LAVISTA
NE
68128
1011
FAMOUS FOOTWEAR
NEBRASKA CROSSING F.S.
14333 S. HWY 31  #F117
GRETNA
NE
68028
1474
FAMOUS FOOTWEAR
WESTROADS MALL
10000 CALIFORNIA STREET
OMAHA
NE
68114
2007
FAMOUS FOOTWEAR
CROSSROADS MALL
7400 DODGE ST
OMAHA
NE
68114
2055
FAMOUS FOOTWEAR
SUNSET PLAZA
1700 MARKET LANE
NORFOLK
NE
68701
2120
FAMOUS FOOTWEAR
SOUTH POINT PAVILLION
3010 PINE LAKE ROAD
LINCOLN
NE
68516
2121
FAMOUS FOOTWEAR
OAKVIEW PLAZA
3117 OAKVIEW DRIVE
OMAHA
NE
68144
2264
FAMOUS FOOTWEAR
EAST PARK SHOPPING CENTER
220 N 66TH STREET STE 320B
LINCOLN
NE
68505
2391
FAMOUS FOOTWEAR
EAGLE RUN SHOPPING CENTER
1115 ALLEN DRIVE
GRAND ISLAND
NE
68803
2513
FAMOUS FOOTWEAR
SORENSEN PARK PLAZA
6330 N 73RD ROAD PLAZA
OMAHA
NE
68122
2529
FAMOUS FOOTWEAR
EAGLE RUN SHOPPING CENTER
13330 WEST MAPLE ROAD
OMAHA
NE
68164

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2598
FAMOUS FOOTWEAR
SHADOW LAKE CENTER
7721 TOWNE CENTER PARKWAY # 103
PAPILLION
NE
68046
2684
FAMOUS FOOTWEAR
HILLTOP MALL
5035 2ND AVENUE SUITE # 27
KEARNEY
NE
68847
2685
FAMOUS FOOTWEAR
PLATTE RIVER MALL
1000 S. DEWEY STREET  SUITE 250
NORTH PLATTE
NE
69101
2686
FAMOUS FOOTWEAR
VILLAGE CENTER
130 24TH STREET
COLUMBUS
NE
68601
273
FAMOUS FOOTWEAR
NORTH HAMPTON OUTLET
LAFAYETTE RD. P.O.BOX 760
NORTH HAMPTON
NH
03862
274
FAMOUS FOOTWEAR
KEENE MILL OUTLET CTR.
149 EMERALD AVENUE
KEENE
NH
03431
501
FAMOUS FOOTWEAR
SETTLER'S GREEN OUTLET 23
ROUTE 16/302 #A2-6
NORTH CONWAY
NH
03860
954
FAMOUS FOOTWEAR
LAKES REGION FAC. STORES
120 LACONIA RD STE 124
TILTON
NH
03276
1733
FAMOUS FOOTWEAR
MALL OF NEW HAMPSHIRE
1500 S WILLOW ST
MANCHESTER
NH
03103
2387
FAMOUS FOOTWEAR
UPPER VALLEY SHOPPING CENTER
250 ROUTE 12 A
WEST LEBANON
NH
03784
2581
FAMOUS FOOTWEAR
ROCHESTER CROSSONG
160 WASHINGTON STREET  SUITE 101
ROCHESTER
NH
03839
266
FAMOUS FOOTWEAR
THE COURT AT DEPTFORD
301 N. ALMONESSON RD 3B
DEPTFORD
NJ
08096
567
FAMOUS FOOTWEAR
EAST GATE SQUARE
1150 NIXON DRIVE
MOUNT LAUREL
NJ
08054
1532
FAMOUS FOOTWEAR
SIX FLAGS FACTORY OUTLET
537 MONMOUTH ROAD STE 122
JACKSON
NJ
08527
1718
FAMOUS FOOTWEAR
JERSEY GARDENS
651 KAPLOWSKI ROAD
ELIZABETH
NJ
07201
2087
FAMOUS FOOTWEAR
ROXBURY MALL
275-350 , ROUTE 10 EAST
SUCCASUNNA
NJ
07876
2088
FAMOUS FOOTWEAR
WATCHUNG SQUARE
1515 ROUTE 22 WEST
WATCHUNG
NJ
07060
2118
FAMOUS FOOTWEAR
HAMILTON MALL
440 MARKETPLACE BLVD
HAMILTON
NJ
08650
2182
FAMOUS FOOTWEAR
NASSAU PARK PAVILI
550 NASSAU PARK BLUD., STE. 6
PRINCETON
NJ
03540

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2211
FACTORY BRAND SHOES
ATLANTIC CITY OUTLET
112 NORTH MICHIGAN
ATLANTIC CITY
NJ
08401
2223
FAMOUS FOOTWEAR
PARAMUS PLACE
165 EAST ROUTE 4
PARAMUS
NJ
07652
2224
FAMOUS FOOTWEAR
EAST WINDSOR VILLAGE
72 PRINCETON HIGHTSTOWN
EAST WINDSOR
NJ
08520
2282
FAMOUS FOOTWEAR
WILLOW RIDGE PLAZA
744 RT 735
MARLTON
NJ
08053
2287
FAMOUS FOOTWEAR
LIBERTY VLG OUTLET CENTER
ONE CHURCH STREET
FLEMINGTON
NJ
08822
2294
FAMOUS FOOTWEAR
KOHL'S SHOPPING CENTER
14 MAIN STREET
CLIFTON
NJ
07014
2299
FAMOUS FOOTWEAR
FLEMINGTON CIRCLE DRIVE
276 ROUTES 202 & 31
FLEMINGTON
NJ
08822
2314
FAMOUS FOOTWEAR
VALLEY MALL
977 VALLEY ROAD
GILLETTE
NJ
07933
2316
FAMOUS FOOTWEAR
CONSUMER SQUARE
4751 ROUTE 9 NORTH
HOWELL
NJ
07731
2359
FAMOUS FOOTWEAR
HADLEY CENTER
4951 STELTON ROAD
SOUTH PLAINFIELD
NJ
07080
2372
FAMOUS FOOTWEAR
CROSS KEYS COMMONS # G-3
3501 BLACK HORSE PIKE
TURNERSVILLE
NJ
08012
2408
FAMOUS FOOTWEAR
BRUNSWICK SQUARE MALL
755 HWY 18  SPACE 950
EAST BRUNSWICK
NJ
08816
2413
FAMOUS FOOTWEAR
WAYNECHESTER PLAZA
1632 ROUTE 23 NORTH
WAYNE
NJ
07470
2435
FAMOUS FOOTWEAR
MANAHAWKIN COMMONS
601 WASHINGTON AVENUE
MANAHAWKIN
NJ
08050
2486
FAMOUS FOOTWEAR
GRANDE SHOPPING CENTER
3201 ROUTE 9 S  SPACE "D"
RIO GRANDE
NJ
08242
2501
FAMOUS FOOTWEAR
MARLBORO PLAZA
160 ROUTE 9 NORTH
ENGLISHTOWN
NJ
07726
2521
FAMOUS FOOTWEAR
GREENWICH CENTER
1203 NEW BRUNSWICK AVE.
PHILLIPSBURG
NJ
08865
2568
FAMOUS FOOTWEAR
SHREWSBURY PLAZA
460 SHREWSBURY PLAZA
SHREWSBURY
NJ
07702
2609
FAMOUS FOOTWEAR
UNION  LAKE CROSSING
2114 NORTH 2ND STREET
MILLVILLE
NJ
08332

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2636
FAMOUS FOOTWEAR
MORRIS HILLS SHOPPING CENTER
ROUTE 46 & 202 SPACE 20
PARSIPPANY ( TROY HILLS)
NJ
07054
2660
FAMOUS FOOTWEAR
ITC CROSSING SHOPPING CENTER
50 INTERNATIONAL DRIVE # 12
FLANDERS ( MT. OLIVE)
NJ
07836
2670
FAMOUS FOOTWEAR
COLONIAL SHOPPING PLAZA
1121 STATE ROUTE 34  SUITE G
MATAWAN ( ABERDEEN)
NJ
07747
2719
FAMOUS FOOTWEAR
MIDDLETOWN COMMONS
754 STATE ROUTE 35  (826)
MIDDLETON
NJ
07748
2924
FAMOUS FOOTWEAR
HAMILTON COMMONS
4215 BLACKHORSE PIKE
MAYS LANDING
NJ
08330
93313
NATURALIZER
DEPTFORD MALL
1750 DEPTFORD CENTER RD. SPACE 2029
DEPTFORD
NJ
08096
94238
NATURALIZER
GARDEN STATE PLAZA
RTES 4 & 17, SPACE #10-1041
PARAMUS
NJ
07652
96610
NATURALIZER OUTLET
THE WALK
1930 ATLANTIC AVENUE
ATLANTIC CITY
NJ
08401
96725
NATURALIZER OUTLET
JACKSON PREMIUM OUTLETS
537 MONMOUTH ROAD, SPACE 198
JACKSON TOWNSHIP
NJ
08527
595
FAMOUS FOOTWEAR
MESILLA VALLEY MALL
700 S TELSHOR - #1530
LAS CRUCES
NM
88001
697
FAMOUS FOOTWEAR
SANTA FE FACTORY STORES
8380 CERRILLOS RD #440
SANTA FE
NM
87505
1220
FAMOUS FOOTWEAR
ANIMAS VALLEY MALL
4601 E. MAIN ST. STE 118
FARMINGTON
NM
87402
1518
FAMOUS FOOTWEAR
COTTONWOOD MALL
10000 COORS BLVD NW #D211
ALBUQUERQUE
NM
87114
2148
FAMOUS FOOTWEAR
PLAZA SANTA FE
3537 ZAFARANO DR STE C
SANTA FE
NM
87505
2577
FAMOUS FOOTWEAR
BLUE MOUNTAIN JUNCTION
4301 NORTH MAIN   SUITE B
ROSWELL
NM
88201
2585
FAMOUS FOOTWEAR
MONTGOMERY PLAZA
5001 MONTGOMERY BLVD.,  A-21
ALBUQUERQUE
NM
87109
411
FAMOUS FOOTWEAR
BELZ FACTORY OUT. WORLD
7400 S LAS VEGAS BLVD #59
LAS VEGAS
NV
89123
490
FAMOUS FOOTWEAR
BOULEVARD MALL
3680 S MARYLAND PKWY #175
LAS VEGAS
NV
89109

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
605
FAMOUS FOOTWEAR
CHEYENNE COMMONS
3039 N RAINBOW BLVD. #C-1
LAS VEGAS
NV
89108
1421
FAMOUS FOOTWEAR
HORIZON OUTLET CENTER
1955 S. CASINO DR.STE 232
LAUGHLIN
NV
89029
1589
FAMOUS FOOTWEAR
GALLERIA AT SUNSET
1300 W SUNSET RD-#1615
HENDERSON
NV
89014
1757
FAMOUS FOOTWEAR
SILVERADO RANCH STATION
9863 S. EASTERN AVE.
LAS VEGAS
NV
89104
2001
FAMOUS FOOTWEAR
BOCA PARK MARKETPLACE
8740 W. CHARLESTON
LAS VEGAS
NV
89117
2138
FAMOUS FOOTWEAR
CENTINNIAL CENTER
7951 TROPICAL PARKWAY
LAS VEGAS
NV
89149
2236
FAMOUS FOOTWEAR
SIERRA TOWN CENTER
6865 SIERRA CENTER PARKWAY
RENO
NV
89511
2286
FAMOUS BRAND
LAS VEGAS PREMIUM OUTLET
855 SOUTH CENTRAL PKWY STE # 1875
LAS VEGAS
NV
89106
2332
FAMOUS FOOTWEAR
CARSON VALLEY PLAZA
955 TOPSY LANE
CARSON CITY
NV
89705
2537
FAMOUS FOOTWEAR
SPARKS CROSSINGS
221 LOS ALTOS PARKWAY
SPARKS
NV
89436
2569
FAMOUS FOOTWEAR
THE ARROYO MARKET SQUARE
7265 ARROYO CROSSINGS PARKWAY
LAS VEGAS
NV
89118
2672
FAMOUS FOOTWEAR
RIDGEVIEW PLAZA
5110 MAE ANNE AVENUE  UNIT 601
RENO
NV
89523
96623
NATURALIZER OUTLET
PREFERRED OUTLETS @ LAUGHLIN
1955 S. CASINO DRIVE SUITE 240
LAUGHLIN
NV
89029
96702
NATURALIZER OUTLET
LAS VEGAS PREMIUM OUTLET
855 SOUTH CENTRAL PKWY STE # 1855
LAS VEGAS
NV
89106
96721
NATURALIZER OUTLET
LAS VEGAS OUTLER CENTER
7400 S. LAS VEGAS BLVD. #27
LAS VEGAS
NV
89123
99113
BROWN SHOE CLOSET
FASHION OUTLETS LAS VEGAS
32100 LAS VEGAS BLVD. S
PRIMM  (JEAN)
NV
89019
99164
BROWN SHOE CLOSET
LAS VEGAS OUTLET CENTER
7400 S. LAS VEGAS BLVD. # 245
LAS VEGAS
NV
89123
78
FAMOUS FOOTWEAR
PRIME OUTLETS@NIAGRA FALL
S638 MILITARY ROAD-#37
NIAGARA FALLS
NY
14304

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
86
FAMOUS FOOTWEAR
SOUTH TOWN PLAZA
3333 W HENRIETTA RD-SP 13
ROCHESTER
NY
14623
93
FAMOUS FOOTWEAR
PANORAMA PLAZA
1601 PENFIELD RD
PENFIELD
NY
14625
125
FAMOUS FOOTWEAR
POUGHKEEPSIE PLAZA MALL
ROUTE 9
POUGHKEEPSIE
NY
12601
951
FAMOUS FOOTWEAR
COBBLESTONE COURT
8000 VICTOR-PITTSFORD RD.
VICTOR
NY
14564
1046
FAMOUS FOOTWEAR
TOPS PLAZA
2101 ELMWOOD AVENUE
BUFFALO
NY
14207
1168
FAMOUS FOOTWEAR
SHOPPINGTOWN MALL
3649 ERIE BLVD STE 76
DEWITT
NY
13214
1181
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
RTE 9 PO BOX 3214 SUITE 3
LAKE GEORGE
NY
12845
1346
FAMOUS FOOTWEAR
CHAUTAQUA MALL
318 E. FAIRMONT AVE. 374
LAKEWOOD
NY
14750
1367
FAMOUS FOOTWEAR
HUDSON VALLEY TOWN CTR
18 WESTAGE DR #5
FISHKILL
NY
12524
1402
FAMOUS FOOTWEAR
ROTTERDAM SQUARE
2 CAMPELL ROAD
ROTTERDAM
NY
12303
1484
FAMOUS FOOTWEAR
WILTON MALL
3065 RT. 50 STE E26
SARATOGA SPRINGS
NY
12866
1527
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
TANGER DRIVE-STE 1001
RIVERHEAD
NY
11901
1555
FAMOUS FOOTWEAR
BELLPORT OUTLET CENTER
10 FARBER DRIVE SUITE 9
BELLPORT
NY
11713
1598
FAMOUS FOOTWEAR
PRIME OUTLETS @ WATERLOO
655 ROUTE 318-SUITE A42
WATERLOO
NY
13165
1606
FAMOUS FOOTWEAR
EASTERN HILLS MALL
4545 TRANSIT RD-SUITE 355
WILLIAMSVILLE
NY
14221
1621
FAMOUS FOOTWEAR
WOODBURY COMMONS
968 GRAPEVINE CT
CENTRAL VALLEY
NY
10917
1730
FAMOUS FOOTWEAR
CONSUMER SQUARE
845 COUNTY ROUTE 64
ELMIRA
NY
14903
1750
FAMOUS FOOTWEAR
COLONIE CENTER
1425 CENTAL AVENUE  # 131
COLONIE
NY
12205
1790
FAMOUS FOOTWEAR
PHILLIPS AT SUNRISE
5500 SUNRISE HWY.
MASSAPEQUA
NY
11758
2012
FAMOUS FOOTWEAR
AVIATION MALL
578 AVIATION RD
QUEENSBURY
NY
12804

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2013
FAMOUS FOOTWEAR
CAROUSEL CENTER
9090 CAROUSEL CENTER DR
SYRACUSE
NY
13290
2014
FAMOUS FOOTWEAR
CROSSGATES MALL
1 CROSSGATES MALL ROAD
ALBANY
NY
12203
2018
FAMOUS FOOTWEAR
SALMON RUN MALL
21182 SALMON RUN LOOP W.
WATERTOWN
NY
13601
2019
FAMOUS FOOTWEAR
WALDEN GALLERIA
ONE WALDEN GALLERIA
BUFFALO
NY
14225
2131
FAMOUS FOOTWEAR
SHOPPES AT VESTAL
2317 VESTAL PKWY EAST #B
VESTAL
NY
13850
2160
FAMOUS FOOTWEAR
HOME DEPOT PLAZA
5031 JERRICO TURN PIKE
COMMACK
NY
11725
2183
FAMOUS FOOTWEAR
THE SOURCE
1504 OLD COUNTRY RD
WESTBURY
NY
11590
2215
FAMOUS FOOTWEAR
ORANGE PLAZA
470 ROUTE 11 EAST SUITE 11
MIDDLETOWN
NY
10940
2239
FAMOUS FOOTWEAR
GATEWAY CENTER
381 GATEWAY DRIVE
BROOKLYN
NY
11239
2257
FAMOUS FOOTWEAR
ISLANDIA SHOPPING CENTER
1704 VETERANS MEMORIAL HWY
ISLANDIA
NY
11722
2295
FAMOUS FOOTWEAR
GREECE TOWN MALL
486 GREECE CENTER RIDGE DRIVE C1
ROCHESTER
NY
14626
2298
FAMOUS FOOTWEAR
SOUTH PORT SHOPPING CTR
1017 MONTAUK HWY
SHIRLEY
NY
11967
2303
FAMOUS FOOTWEAR
WATERFRONT @ PORTCHESTER
14 WATERFRONT PLACE
PORTCHESTER
NY
10573
2319
FAMOUS FOOTWEAR
RIVERHEAD CENTER
1440 OLD COUNTRY ROAD
RIVERHEAD
NY
11901
2321
FAMOUS FOOTWEAR
QUEENS CENTER
90 - 15 QUEENS BLVD  # 0032
ELMHURST
NY
11373
2349
FAMOUS FOOTWEAR
MOHAWK COMMONS
430 BALLTOWN ROAD
NISKAYUNA
NY
12304
2367
FAMOUS FOOTWEAR
PLATTSBURGH CONSUMER SQ
57 CONSUMER SQUARE
PLATTSBURGH
NY
12901
2383
FAMOUS FOOTWEAR
MCKINLEY MALL
510 MCKINLEY MALL
BUFFALO
NY
14219
2401
FAMOUS FOOTWEAR
ONE PENN CENTER
250 W. 34TH STREET
NEW YORK
NY
10119
2406
FAMOUS FOOTWEAR
MOUNT VERNON CENTER
55 SANFORD BLVD.
MT VERNON
NY
10550
2411
FAMOUS FOOTWEAR
KOHL'S PLAZA
346 ROUTE 25 A, SUITE 74-80
ROCKY POINT
NY
11778
2434
FAMOUS FOOTWEAR
BROADWAY MALL
358 BROADWAY SUITE # 206
HICKSVILLE
NY
11801

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2478
FAMOUS FOOTWEAR
BOULEVARD CONSUMERS SQUARE
1561 NIAGRA FALLS BLVD.
AMHERST
NY
14228
2522
FAMOUS FOOTWEAR
THE CROSSING
54 THE CROSSING BLVD.  # B-D
CLIFTON PARK
NY
12065
2542
FAMOUS FOOTWEAR
UNION CONSUMER SQUARE
3801 UNION ROAD, SUITE #4
CHEEKTOWAGA
NY
14225
2608
FAMOUS FOOTWEAR
THE ORCHARDS SHOPPING CENTER
8647 CLINTON STREET
NEW HARTFORD
NY
13413
2658
FAMOUS FOOTWEAR
QUAKER CROSSINGS
3465 AMELIA DRIVE
ORCHARD PARK
NY
14127
2659
FAMOUS FOOTWEAR
BIG H SHOPPING CENTER
811 NEW YORK AVENUE
HUNTINGTON
NY
11743
2674
FAMOUS FOOTWEAR
AUBURN PLAZA
217 GRANT AVENUE  SPACE 2
AUBURN
NY
13021
2695
FAMOUS FOOTWEAR
GLEMNONT PLAZA
376 FEURA BUSH ROAD  # 145
GLENMONT
NY
12077
2716
FAMOUS FOOTWEAR
TOWNE CENTER @ WEBSTER
1058 RIDGE ROAD SPACE E-1
WEBSTER
NY
14580
2806
FAMOUS FOOTWEAR
DENA MARIE PLAZA
910 MIRON LANE
KINGSTON
NY
12401
2817
FAMOUS FOOTWEAR
COUNTRY SQUIRE PLAZA
7954 BREWERTON ROAD # 200
CICERO
NY
13039
2836
FAMOUS FOOTWEAR
SOUTH SHORE COMMONS
2955 VETERANS ROAD WEST # 1-A
STATEN ISLAND
NY
10309
2838
FAMOUS FOOTWEAR
ITHACA MALL
40 CATHERWOOD ROAD
ITHACA
NY
14850
2886
FAMOUS FOOTWEAR
TOWNE CENTER @ FAYETTEVILLE
106 TOWNE DRIVE
FAYETTEVILLE
NY
13066
2898
FAMOUS FOOTWEAR
TANGER OUTLETS @ THE ARCHES
872 THE ARCHES CIRCLE
DEE PARK
NY
11729
91751
NATURALIZER
STATEN ISLAND
2655 RICHMOND AVENUE
STATEN ISLAND
NY
10314
91788
NATURALIZER
BOULEVARD MALL
1259 - A NIAGRA FALL BLVD
AMHERST
NY
14226
94224
NATURALIZER
WALT WHITMAN MALL
RT 110 & JERICHO TURNPIKE
HUNTINGTON STATION
NY
11746

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
94251
NATURALIZER
KINGS PLAZA
5321 KINGS PLAZA, SUITE C5U
BROOKLYN
NY
11234
94256
NATURALIZER
 
712 LEXINGTON AVE
NEW YORK
NY
10022
94257
NATURALIZER
GREEN ACRES MALL
1104 GREEN ACRES MALL
VALLEY STREAM
NY
11581
96637
NATURALIZER OUTLET
WOODBURY COMMONS
112 MARIGOLD COURT  RTE 32
CENTRAL VALLEY/WOODBURY
NY
10917
96638
NATURALIZER OUTLET
TANGER FACTORY OUTLET
1770 W. MAIN STREET  SUITE 218
RIVERHEAD
NY
11901
96646
NATURALIZER OUTLET
TANGER OUTLETS @ THE ARCHES
1118 THE ARCHES CIRCLE
DEE PARK
NY
11729
99018
VIA SPIGA
BROADWAY - SOHO
487 BROADWAY
NEW YORK
NY
10013
539
FAMOUS FOOTWEAR
GOLDEN GATE S.C.
1574 MAYFIELD ROAD
MAYFIELD HEIGHTS
OH
44124
540
FAMOUS FOOTWEAR
ERIE COMMONS PLAZA
8000 PLAZA BLVD.
MENTOR
OH
44060
541
FAMOUS FOOTWEAR
PLAZA CHAPEL HILL PLAZA
338 HOWE AVE
CUYAHOGA FALLS
OH
44221
545
FAMOUS FOOTWEAR
ROSEMONT COMMONS S.C.
3750 W MARKET ST UNIT L
FAIRLAWN
OH
44333
546
FAMOUS FOOTWEAR
RIVERSTREET SQUARE
227 MIDWAY BLVD D5 & D6
ELYRIA
OH
44035
574
FAMOUS FOOTWEAR
RIDGE PARK SQUARE
4790 RIDGE ROAD
BROOKLYN
OH
44144
576
FAMOUS FOOTWEAR
MACEDONIA CMNNS S.C.
8210 MACEDONIA CMMNS BLVD
MACEDONIA
OH
44056
1022
FAMOUS FOOTWEAR
FAIRFIELD CROSSINGS
4641 DIXIE HWY
FAIRFIELD
OH
45014
1072
FAMOUS FOOTWEAR
AURORA PREMIUM OUTLETS
549 CHILLICOTHE #310
AURORA
OH
44202
1091
FAMOUS FOOTWEAR
CARNATION MALL
2500 WEST STATE STREET
ALLIANCE
OH
44601
1217
FAMOUS FOOTWEAR
MONTGOMERY CROSSING
9460 FIELDS ERTEL
CINCINNATI
OH
45249
1256
FAMOUS FOOTWEAR
PARMATOWN PLAZA
7621 W. RIDGEWOOD #77
PARMA
OH
44129

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
1348
FAMOUS FOOTWEAR
WOODLAND MALL
1234 N. MAIN ST. BOX 14
BOWLING GREEN
OH
43402
1370
FAMOUS FOOTWEAR
PRIME OUTLET @ LODI
9909 AVON LAKE ROAD, STE. 470
BURBANK
OH
44214
1460
FAMOUS FOOTWEAR
LIMA MALL
2400 ELIDA ROAD STE 154
LIMA
OH
45805
1570
FAMOUS FOOTWEAR
BELDEN PARK CROSSINGS
5496 DRESSLER RD_#55
CANTON
OH
44720
1605
FAMOUS FOOTWEAR
SOUTHERN PARK MALL
7401 MARKET STREET #473
YOUNGSTOWN
OH
44512
1646
FAMOUS FOOTWEAR
WILLOUGHBY COMMONS
36375 EUCLID AVE
WILLOUGHBY
OH
44094
1660
FAMOUS FOOTWEAR
OHIO VALLEY PLAZA
50483 VALLEY PLAZA RD
ST CLAIRSVILLE
OH
43950
1715
FAMOUS FOOTWEAR
SUN CENTER
3640 W. DUBLIN GRANVILLE
COLUMBUS
OH
43235
1716
FAMOUS FOOTWEAR
POLARIS TOWNE CENTRE
1223 POLARIS PARKWAY
COLUMBUS
OH
43240
2096
FAMOUS FOOTWEAR
AVON COMMONS
35882 DETROIT RD.
AVON
OH
44011
2101
FAMOUS FOOTWEAR
LENNOX TOWN CENTER
1665 OLENTANGY RIVER ROAD
COLUMBUS
OH
43212
2112
FAMOUS FOOTWEAR
NORTH POINTE PLAZA
114 MEADOW PARK AVENUE
LEWIS CENTER
OH
43035
2200
FAMOUS FOOTWEAR
UNIVERSITY SQUARE
14060 CEDAR ROAD STE #280
UNIVESITY HGTS
OH
44118
2212
FAMOUS FOOTWEAR
MARKETPLACE AT FOUR CORNERS
7085 MARKETPLACE DRIVE
AURORA
OH
45612
2263
FAMOUS FOOTWEAR
TAYLOR SQUARE MALL
2937 TAYLOR RD SW
REYNOLDSBURG
OH
43068
2302
FAMOUS FOOTWEAR
VOICE OF AMERICA
7620 VOICE OF AMERICA DRIVE
WEST CHESTER
OH
45069
2348
FAMOUS FOOTWEAR
GREENS OF STRONGSVILLE
18074 ROYALTON ROAD
STRONGSVILLE
OH
44136
2393
FAMOUS FOOTWEAR
ONTARIO TOWN CENTER
2265 WALKER LAKE ROAD
MANSFIELD
OH
44903
2441
FAMOUS FOOTWEAR
THE MARKET @ HILLIARD
1816 ROME-HILLIARD ROAD
COLUMBUS
OH
43026

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME     MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2452
FAMOUS FOOTWEAR
NORTHPARK CENTER
8231 OLD TROY PIKE ROAD
HUBER HEIGHTS
OH
45424
2533
FAMOUS FOOTWEAR
NORTHPOINTE CENTER
3849 GORSKY DRIVE
ZANESVILLE
OH
43701
2586
FAMOUS FOOTWEAR
STEELYARD COMMONS
3521 STEELYARD DRIVE
CLEVELAND
OH
44109
2688
FAMOUS FOOTWEAR
STONE CREEK TOWNE CREEK
3667 STONE CREEK BLVD.
CINCINNATI
OH
45251
2706
FAMOUS FOOTWEAR
WEST GATE PLAZA
3210 WEST GATE SUITE # 312
FAIRVIEW PARK
OH
44126
2726
FAMOUS FOOTWEAR
CROSSINGS @ SANDUSKY
901 CROSSINGS ROAD
SANDUSKY
OH
44870
2763
FAMOUS FOOTWEAR
ARLINGTON RIDGE MARKETPLACE
790 ARLINGTON RIDGE  SUITE 309
AKRON
OH
44306
2771
FAMOUS FOOTWEAR
SHOPPES @ INDIAN SPRINGS
3165 PRINCETON ROAD
FAIRFIELD TOWNSHIP
OH
45011
2800
FAMOUS FOOTWEAR
GREAT NORTHERN MALL
422 GREAT NORTHERN MALL
NORTH OLMSTED
OH
44070
2834
FAMOUS FOOTWEAR
PARKWAY CENTRE EAST
4164 BUCKEYE PARKWAY
GROVE CITY
OH
43123
2839
FAMOUS FOOTWEAR
HARVARD PARK SHOPPING CENTER
4073 RICHMOND ROAD
WARRENSVILLE HEIGHTS
OH
44122
2846
FAMOUS FOOTWEAR
STOW COMMUNITY S.C.
4224 KENT ROAD
STOW
OH
44224
2847
FAMOUS FOOTWEAR
EASTERN MARKET SQUARE
3725 EASTON MARKET
COLUMBUS
OH
43219
91961
NATURALIZER
POLARIS FASHION MALL
1500 POLARIS PARKWAY SUITE 1042
COLUMBUS
OH
43240
625
FAMOUS FOOTWEAR
FRENCH MARKET CENTER
2804 NW 63RD ST
OKLAHOMA CITY
OK
73116
690
FAMOUS FOOTWEAR
SOONER FASHION MALL
3447 WEST MAIN
NORMAN
OK
73072
1025
FAMOUS FOOTWEAR
VANDEVER ACRES
732 W. NEW ORLEANS #116
BROKEN ARROW
OK
74012

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
1026
FAMOUS FOOTWEAR
WASHINGTON PARK MALL
2350 SE WASHINGTON #310
BARTLESVILLE
OK
74006
1199
FAMOUS FOOTWEAR
OAKWOOD MALL
4125 W. GARRIOTT #F-4
ENID
OK
73703
1302
FAMOUS FOOTWEAR
MOUTAIN VIEW MALL
1211 NORTH COMMERCE
ARDMORE
OK
73401
1383
FAMOUS FOOTWEAR
CENTRAL MALL
141 CENTRAL MALL
LAWTON
OK
73501
1522
FAMOUS FOOTWEAR
TULSA PROMENADE
41ST & YALE AVE STE GL707
TULSA
OK
74135
1723
FAMOUS FOOTWEAR
BRADFORD PLAZA
623 N. MAIN ST
STILLWATER
OK
74075
1748
FAMOUS FOOTWEAR
CROSS OAKS CENTER
7142 SOUTH MEMORIAL
TULSA
OK
74133
1763
FAMOUS FOOTWEAR
ARROWHEAD MALL
510 NORTH MAIN #26
MUSKOGEE
OK
74401
2004
FAMOUS FOOTWEAR
CROSSROADS MALL
7000 CROSSROADS MALL DR
OKLAHOMA CITY
OK
73149
2006
FAMOUS FOOTWEAR
QUAIL SPRINGS
2501 W. MEMORIAL RD.  # 217
OKLAHOMA CITY
OK
73134
2099
FAMOUS FOOTWEAR
SOUTHROADS VILLAGE
5323 EAST 41ST STREET
TULSA
OK
74135
2474
FAMOUS FOOTWEAR
240 PENN PARK SHOPPING CENTER
1453 W I 240 SERVICE ROAD
OKLAHOMA CITY
OK
73159
2509
FAMOUS FOOTWEAR
SHOPPES @ MOORE
2320 SOUTH SERVICE ROAD
MOORE
OK
73160
2622
FAMOUS FOOTWEAR
ROCKWELL PLAZA
8525 N. ROCKWELL AVE.
OKLAHOMA CITY
OK
73132
2739
FAMOUS FOOTWEAR
TULSA HILLS
7334 S. OLYMPIA AVE WEST
TULSA
OK
74132
2819
FAMOUS FOOTWEAR
BRYANT SQUARE
530 SOUTH BRYANT AVENUE
EDMOND
OK
73034
258
FAMOUS FOOTWEAR
COLUMBIA GORGE F.S.
450 NW 257TH AVE #408
TROUTDALE
OR
97060
1145
FAMOUS FOOTWEAR
FACTORY STORES AT LINCOLN
1500 SE E.DEVILS LAKE RD
LINCOLN CITY
OR
97367
1151
FAMOUS FOOTWEAR
ROGUE VALLEY MALL
1600. N. RIVERSIDE DR SUITE # 2022
MEDFORD
OR
97501
1224
FAMOUS FOOTWEAR
GATEWAY MALL
3000 GATEWAY STREET-504
SPRINGFIELD
OR
97477

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME     MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
1539
FAMOUS FOOTWEAR
PRIME OUTLETS @ BEND
61350 S.HWY 97
BEND
OR
97702
1690
FAMOUS FOOTWEAR
WOODBURN COMPANY STORES
1001 ARNEY ROAD
WOODBURN
OR
97071
2060
FAMOUS FOOTWEAR
SALEM CENTER
401 CENTER STREET N.E.
SALEM
OR
97301
2077
FAMOUS FOOTWEAR
GRESHAM STATION
1271 NW CIVIC DRIVE
GRESHAM
OR
97030
2229
FAMOUS FOOTWEAR
MALL 205
9950 SE WASHINGTON ST D12
PORTLAND
OR
97216
2235
FAMOUS FOOTWEAR
TANASBOURNE TC
18049 NW EVERGREEN PKWY
TANASBOURNE
OR
97006
2307
FAMOUS FOOTWEAR
SEASIDE FACTORY OUTLET
1111 NORTH ROOSEVELT , STE 216
SEASIDE
OR
97138
2403
FAMOUS FOOTWEAR
HERITAGE MALL
2245 14TH AVENUE SE
ALBANY
OR
97322
2421
FAMOUS FOOTWEAR
LANCASTER MALL
831 LANCASTER DRIVE  N.E.  # 137
SALEM
OR
97301
2430
FAMOUS FOOTWEAR
CEDAR HILLS CROSSING
3195 S W CEDAR HILLS BLVD.  SUITE # 95
BEAVERTON
OR
97005
2484
FAMOUS FOOTWEAR
CASCADE VILLAGE SHOPPING CENTER
63455 N HIGHWAY 97
BEND
OR
97701
2553
FAMOUS FOOTWEAR
KEIZER STATION VILLAGE CENTER
6485 KEIZER STATION BLVD.
KEIZER
OR
97303
2650
FAMOUS FOOTWEAR
JEFFERSON  SQUARE
2850 S 6TH STREET
KLAMATH FALLS
OR
97603
2673
FAMOUS FOOTWEAR
NYBERG WOODS
7023 SW NYBURG STREET
TUALATIN
OR
97062
2693
FAMOUS FOOTWEAR
CASCADE STATION
9959 NE CASCADES PARKWAY
PORTLAND
OR
97220
2701
FAMOUS FOOTWEAR
CORVALLIS MARKET CENTER
1550 N 9TH STREET  SUITE 107
CORVALLIS
OR
97330
2709
FAMOUS FOOTWEAR
MCMINNVILLE PLAZA
2604 NE HWY 99 W
MCMINNVILLE
OR
97128
2794
FAMOUS FOOTWEAR
SUNSET ESPLANADE
2305 TUALATIN VALLEY HIGHWAY
HILLSBORO
OR
97123
2795
FAMOUS FOOTWEAR
ROSS CENTER
11211 SE 82ND AVENUE  SUITE C
CLACKAMAS
OR
97086

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2822
FAMOUS FOOTWEAR
GRANT PASS SHOPPING CENTER
919 NORTHEAST D STREET
GRANTS PASS
OR
97526
96603
NATURALIZER OUTLET
WOODBURN COMPANY STORES
1001 ARNEY ROAD, SUITE 216
WOODBURN
OR
97071
96622
NATURALIZER OUTLET
TANGER OUTLET CENTER
1500 SE EAST DEVILS LAKE ROAD  # 404
LINCOLN CITY
OR
97367
96724
NATURALIZER OUTLET
COLUMBIA GORGE PREMIUM OUTLETS
450 N.W. 257, SUITE 412
TROUTDALE
OR
97060
148
FAMOUS FOOTWEAR
VILLAGE SQUARE
4000 OXFORD DR SPACE C1
BETHEL PARK
PA
15102
202
FAMOUS FOOTWEAR
MIRACLE MILE S.C.
4690 WILLIAM PENN HWY #45
MONROEVILLE
PA
15146
211
FAMOUS FOOTWEAR
WHITELAND TOWNE CENTER
197 W. LINCOLN HIGHWAY
EXTON
PA
19341
212
FAMOUS FOOTWEAR
FRANKLIN MILLS
1464 FRANKLIN MILLS CIR.
PHILADELPHIA
PA
19154
225
FAMOUS FOOTWEAR
PLAZA AT ROBINSON TOWNCTR
1740 PARK MANOR BLVD
PITTSBURGH
PA
15205
275
FAMOUS FOOTWEAR
GATEWAY S.C.
261 SWEDEFORD ROAD
WAYNE
PA
19087
276
FAMOUS FOOTWEAR
OLDE SPROUL S.C.
1160 BALTIMORE PIKE
SPRINGFIELD
PA
19064
505
FAMOUS FOOTWEAR
HILLCREST SHOPPING CENTER
LEECHBURG SUITE 179/183
LOWER BURRELL
PA
15068
571
FAMOUS FOOTWEAR
FACTORY STORES AT HERSHEY
92A HERSHEYPARK DRIVE
HERSHEY
PA
17033
594
FAMOUS FOOTWEAR
RALPH'S CORNER S.C.
2333 MAIN STREET C16/C17
LANSDALE
PA
19446
1002
FAMOUS FOOTWEAR
COLUMBIA MALL
225 COLUMBIA MALL DR
BLOOMSBURG
PA
17815
1045
FAMOUS FOOTWEAR
FAIRLESS HILLS S.C.
455 S.  OXFORD VALLEY RD
FAIRLESS HILLS
PA
19030

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
1074
FAMOUS FOOTWEAR
PRIME OUTLETS@SPRINGFIELD
PO BOX 1079 SPACE 740
GROVE CITY
PA
16127
1271
FAMOUS FOOTWEAR
POTTSTOWN CENTER
223 SHOEMAKER RD.
POTTSTOWN
PA
19464
1328
FAMOUS FOOTWEAR
HILLTOP PLAZA
ROUTE 268 HILLTOP PLAZA
KITTANNING
PA
16201
1329
FAMOUS FOOTWEAR
SOUTHTOWNE PLAZA
2550 RTE 286 S. STE
INDIANA
PA
15701
1330
FAMOUS FOOTWEAR
UNION SQUARE SHOPPING CTR
2503 W. STATE STREET
NEW CASTLE
PA
16101
1413
FAMOUS FOOTWEAR
WESTMORELAND MALL
RT 30 EAST
GREENSBURG
PA
15601
1521
FACTORY BRAND SHOES
GETTYSBURG VILLAGE
1863 GETTYSBURG VILLAGE DR, STE 340
GETTYSBURG
PA
17325
1649
FAMOUS FOOTWEAR
ROCKVALE SQUARE
35 S. WILLOWDALE #409/410
LANCASTER
PA
17602
1721
FAMOUS FOOTWEAR
BROADCASTING SQUARE
2761 PAPER MILL ROAD
READING
PA
19610
1745
FAMOUS FOOTWEAR
WARMINISTER TOWNE CTR
940 W. STREET RD.
WARMINSTER
PA
18974
1756
FAMOUS FOOTWEAR
THE METRO PLEX
2520 CHEMICAL RD.
PLYMOUTH MEETING
PA
19462
1785
FAMOUS FOOTWEAR
PENN'S PURCHASE
5860 YORK ROAD
LAHASKA
PA
18931
2042
FAMOUS FOOTWEAR
PAXTON TOWN CENTER
5125 JONESTOWN RD., SUITE 505
HARRISBURG
PA
17112
2159
FAMOUS FOOTWEAR
COLUMBUS CROSSING
1851 SOUTH CHRISTOPHER COLUMBUS BLVD.
PHILADELPHIA
PA
19148
2181
FAMOUS FOOTWEAR
MARKETPLACE OF NESHAMINY
600 ROCKHILL DRIVE
BENSALEM
PA
19020
2274
FAMOUS FOOTWEAR
CRANBERRY  COMMONS MALL
1691 ROUTE 228
CRANBERRY
PA
16066
2288
FAMOUS FOOTWEAR
WATERWORKS PLAZA
975 FREEPORT RD #12
PITTSBURGH
PA
15238
2293
FAMOUS FOOTWEAR
DICKSON CITY COMMONS
1104 COMMERCE BLVD
DICKSON CITY
PA
18519
2301
FAMOUS FOOTWEAR
VF FACTORY
801 HILL AVENUE
READING
PA
19610

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

     STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   STATE   ZIP/MAIL CODE
2329
FAMOUS FOOTWEAR
LONGWOOD VILLAGE
835 E BALTIMORE PIKE
KENNETT SQUARE
PA
19348
2346
FAMOUS FOOTWEAR
TRINITY POINT
44 TRINITY POINT DRIVE # A 03
WASHINGTON
PA
15301
2350
FAMOUS FOOTWEAR
WHITMAN SQUARE
9751 ROOSEVELT BLVD.
PHILADELPHIA
PA
19114
2365
FAMOUS FOOTWEAR
TRAINERS CORNER
180 N. WEST END BLVD.
QUAKER TOWN
PA
18951
2368
FAMOUS FOOTWEAR
LEBANON PLAZA
1131 QUENTIN ROAD
LEBANON
PA
17042
2376
FAMOUS FOOTWEAR
WILKES-BARRE COMMONS
3500 WILKES-BARRE TOWNSHIP
WILKES BARRE
PA
18702
2390
FACTORY BRAND SHOES
TANGER FACTORY OUTLETS
2200 TANGER BLVD.   SUITE 825
WASHINGTON TOWNSHIP
PA
15301
2420
FAMOUS FOOTWEAR
TREXLER MALL
6900 HAMILTON BLVD., SPACE #C-7
TREXLERTOWN
PA
18087
2437
FAMOUS FOOTWEAR
RICHLAND TOWN CENTER
312 TOWN CENTRE DRIVE
JOHNSTOWN
PA
15904
2459
FAMOUS FOOTWEAR
THORNDALE WEST SHOP CTR.
3229 E. LINCOLN HIGHWAY
THORNDALE
PA
19372
2476
FAMOUS FOOTWEAR
CARLISLE CROSSING
252 WEST MINSTER DRIVE
CARLISLE
PA
17013
2492
FACTORY BRAND SHOES
THE CROSSINGS PREMIUM OUTLETS
1000 ROUTE 611 SUITE HO -3
TANNERSVILLE
PA
18372
2524
FAMOUS FOOTWEAR
WHITEHALL MALL
1939 WHITEHALL MALL
WHITEHALL
PA
18052
2531
FAMOUS FOOTWEAR
DELCO PLAZA
1245 CARLISLE ROAD
YORK
PA
17404
2540
FAMOUS FOOTWEAR
PALMER PARK MALL
141 PALMER PARK MALL, SPACE B-4/B-5A
EASTON
PA
18045
2551
FAMOUS FOOTWEAR
SHOPPES @ MONTAGE
 2571 SHOPPES BLVD. # 2571
MOOSIC
PA
18507
2560
FAMOUS FOOTWEAR
NORTH HUNTINGDON SQUARE
8921 ROUTE 30
IRWIN
PA
15642

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER     ADDRESS    CITY   STATE   ZIP/MAIL CODE
2567
FAMOUS FOOTWEAR
GRANITE RUN MALL
1067 W BALTIMORE PKWY # 0212
MEDIA (MIDDLETOWN)
PA
19063
2572
FAMOUS FOOTWEAR
COURT @ OXFORD VALLEY
325 COMMERCE BLVD
FAIRLESS HILLS
PA
19030
2587
FAMOUS FOOTWEAR
HIGH POINTE COMMONS
4674 HIGH POINTE BLVD.
HARRISBURG
PA
17111
2597
FAMOUS FOOTWEAR
THE COURT @ UPPER PROVIDENCE
1844 RIDGE PIKE SUITE # 104
ROYERSFORD
PA
19468
2635
FAMOUS FOOTWEAR
MONTGOMERY MALL
230 MONTGOMERY MALL  # 1003
NORTH WALES
PA
19454
2637
FAMOUS FOOTWEAR
STONE QUARRY COMMONS
95 WAGNER ROAD
MONACA
PA
15061
2640
FAMOUS FOOTWEAR
MT. NEBO POINTE
251 MT. NEBO POINTE DRIVE
PITTSBURGH
PA
15237
2676
FAMOUS FOOTWEAR
FACTORY SHOPS @ GEORGIAN PLAZA
609 GEORGIAN PLACE
SOMERSET
PA
15501
2687
FACTORY BRAND SHOES
PHILADELPHIA PREMIUM OUTLETS
18 LIGHTCAP ROAD  SUITE 999
POTTSTOWN ( LIMERICK)
PA
19464
2725
FAMOUS FOOTWEAR
PITTSBURGH MILLS SMALL SHOPS
1020 VILLAGE CENTER DRIVE  2-A
TARENTUM
PA
15084
2755
FAMOUS FOOTWEAR
WEST GOSHEN SHOPPING CENTER
967 PAOLI PIKE
WEST CHESTER
PA
19380
2811
FAMOUS FOOTWEAR
LYCOMING CROSSINGS SHOPPING CENTER
330 S. LYCOMING
MUNCY  (PENNSDALE)
PA
17756
2853
FAMOUS FOOTWEAR
GRANDVIEW CROSSING
509 GRANDVIEW CROSSING
GIBSONIA
PA
15044
2910
FAMOUS FOOTWEAR
BUTLER COMMONS
320 BUTLER COMMONS
BUTLER
PA
16001
2929
FAMOUS FOOTWEAR
WATERFRONT TOWN CENTER
132 W BRIDGE STREET
HOMESTEAD
PA
15120
96631
NATURALIZER OUTLET
THE CROSSINGS PREMIUM OUTLETS
1000 ROUTE 611 SUITE A-3
TANNERSVILLE
PA
18372

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER      ADDRESS    CITY   STATE   ZIP/MAIL CODE
96639
NATURALIZER OUTLET
TANGER OUTLETS @ LANCASTER
311 STANLEY K. TANGER BLVD.  # 106
LANCASTER
PA
17602
96641
NATURALIZER OUTLET
VF OUTLET VILLAGE
739 READING AVE.
READING
PA
19611
96643
NATURALIZER OUTLET
PHILADELPHIA PREMIUM OUTLETS
18 LIGHTCAP ROAD  SUITE 1001
POTTSTOWN (LIMERICK)
PA
19464
96765
NATURALIZER OUTLET
GETTYSBURG VILLAGE FACTORY STORES
1863 GETTYSBURG VILLAGE DR, STE 950
GETTYSBURG
PA
17325
96766
NATURALIZER OUTLET
ROCKVALE SQUARE
35 S. WILLOWDALE DR., BOX 426
LANCASTER
PA
17602
99104
BROWN SHOE CLOSET
PHILADELPHIA PREMIUM OUTLETS
18 LIGHTCAP ROAD SUITE 1002
POTTSTOWN (LIMERICK)
PA
19464
2027
FAMOUS FOOTWEAR
CROSSING AT SMITHFIELD
371 PUTNAM PIKE SUITE A360
SMITHFIELD
RI
02917
2333
FAMOUS FOOTWEAR
BALD HILL PLAZA
1245 BALD HILL ROAD
WARWICK
RI
02886
2546
FAMOUS FOOTWEAR
LINCOLN MALL
622 G WASHINGTON HWY
LINCOLN
RI
02865
2559
FAMOUS FOOTWEAR
R.K. NEWPORT SHOPPING CENTER
199 CONNELL HWY. UNIT 2
NEWPORT
RI
02840
345
FAMOUS FOOTWEAR
HILTON HEAD FACT.STORES#1
1270 FORDING IS.RD. #E-4
BLUFFTON
SC
29910
691
FAMOUS FOOTWEAR
SANTEE FACTORY STORES
1500 VILLAGE SQUARE BLVD.
SANTEE
SC
29142
1273
FAMOUS FOOTWEAR
MYRTLE BEACH FACTORY STR
4630 HWY 501
MYRTLE BEACH
SC
29579
1454
FAMOUS FOOTWEAR
PRIME OUTLETS @ GAFFNEY
630 FACTORY SHOPPES BLVD
GAFFNEY
SC
29341
2127
FAMOUS FOOTWEAR
HILTON HEAD VILLAGE
1460 FORTING ISLAND RD., SUITE 240
BLUFFTON
SC
29910
2220
FAMOUS FOOTWEAR
NORTH MYRTLE BEACH OUTLET CENTER
10827 KINGS RD, STE 880
MYRTLE BEACH
SC
29572
2493
FACTORY BRAND SHOES
TANGER FACTORY OUTLETS CENTER
4840 TANGER OUTLET BLVD SUITE 930
CHARLESTON
SC
29418

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #     TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
96609
NATURALIZER OUTLET
TANGER OUTLET MALL
5012 WACCAMAW PINES DR
MYRTLE BEACH
SC
29572
96613
NATURALIZER OUTLET
TANGER OUTLET MALL
1270 FORDING ISLAND ROAD SUITE 5 - A
BLUFFTON
SC
29910
96645
NATURALIZER OUTLET
TANGER OUTLET MALL
4840 TANGER OUTLET BLVD SUITE 1036
NORTH CHARLESTON
SC
29418
99105
BROWN SHOE CLOSET
TANGER OUTLET MALL
4840 TANGER OUTLET BLVD SUITE 1036
NORTH CHARLESTON
SC
29418
99196
BROWN SHOE CLOSET
TANGER OUTLET MALL
10839 KINGS ROAD  SUITE 765
MYRTLE BEACH
SC
29572
1188
FAMOUS FOOTWEAR
RUSHMORE MALL
2200 N. MAPLE
RAPID CITY
SD
57701
1517
FAMOUS FOOTWEAR
EMPIRE MALL
4001 W. 41 STREET #940
SIOUX FALLS
SD
57106
316
FAMOUS FOOTWEAR
BELZ FACTORY OUTLET MALL
2655 TEASTER LANE S.36
PIGEON FORGE
TN
37863
496
FAMOUS FOOTWEAR
THE MALL
2011 NORTH ROAN STREET
JOHNSON CITY
TN
37601
1455
FAMOUS FOOTWEAR
PRIME OUTLETS @ LEBANON
250 OUTLET VILLAGE BLVD
LEBANON
TN
37090
1781
FAMOUS FOOTWEAR
OPRY MILLS
114 OPRYLAND DRIVE
NASHVILLE
TN
37214
96640
NATURALIZER OUTLET
OPRY MILLS
201 OPRY MILLS DRIVE
NASHVILLE
TN
37214
96701
NATURALIZER OUTLET
FIVE OAKS FACTORY STORES
1645 PARKWAY, STE. 116
SEVIERVILLE
TN
37862
303
FAMOUS FOOTWEAR
IRVING TOWNE CENTER
3313 W. AIRPORT FREEWAY
IRVING
TX
75062
304
FAMOUS FOOTWEAR
TRINITY MILLS S.C.
2630 N. JOSEY LN. STE 130
CARROLLTON
TX
75007
311
FAMOUS FOOTWEAR
WESTPOINT PEPPER MILL
651 HIGHWAY 81 EAST
NEW BRAUNFELS
TX
78130
338
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
13005 DELANEY ROAD
LA MARQUE
TX
77568
380
FAMOUS FOOTWEAR
OVERTON PARK PLAZA S.C.
4656 SOUTHWEST LOOP 820
FORT WORTH
TX
76109

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
433
FAMOUS FOOTWEAR
MEDALLION SHOPPING CENTER
170 MEDALLION CENTER
DALLAS
TX
75214
495
FAMOUS FOOTWEAR
PARK FOREST S.C.
3747 FOREST LN
DALLAS
TX
75234
597
FAMOUS FOOTWEAR
SOUTH BROOKTOWN CENTER
6425 S I-35  SUITE #120
AUSTIN
TX
78744
632
FAMOUS FOOTWEAR
PRIME OUTLETS@GAINESVILLE
4321 INT. HWY 35 NORTH
GAINESVILLE
TX
76240
1178
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET
301 TANGER DRIVE
TERRELL
TX
75160
1208
FAMOUS FOOTWEAR
KINGS CROSSING
4327 KINGWOOD DRIVE
KINGWOOD
TX
77339
1252
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
421 INDUSTRIAL DR STE#203
SULPHUR SPRINGS
TX
75482
1312
FAMOUS FOOTWEAR
SUNLAND PARK MALL
750 SUNLAND PARK DR
EL PASO
TX
79912
1313
FAMOUS FOOTWEAR
PASADENA TOWN SQUARE
261 PASADENA TWN SQ
PASADENA
TX
77506
1414
FAMOUS FOOTWEAR
GRAPEVINE TOWNE CENTER
1217 W HWY 114
GRAPEVINE
TX
76051
1475
FAMOUS FOOTWEAR
GOLDEN TRIANGLE SHOP.CTR.
2201 S. I-35  SUITE 15A
DENTON
TX
76205
1520
FAMOUS FOOTWEAR
EASTCHASE MARKET
8430 EAST FREEWAY SUITE 200
FORT WORTH
TX
76120
1534
FAMOUS FOOTWEAR
GRAPEVINE MILLS
3000 GRAPEVINE MILLS PKWY
GRAPEVINE
TX
76051
1557
FAMOUS FOOTWEAR
PRIME OUTLETS @ HILLSBORO
104 NE I 35 SUITE 138-A
HILLSBORO
TX
76645
1558
FAMOUS FOOTWEAR
PRIME OUTLETS @ CONROE
1111 LEAGUE LINE RD #174
CONROE
TX
77303
1627
FAMOUS FOOTWEAR
CENTRAL MALL
I-30 & ROBINSON RD-SP 58
TEXARKANA
TX
75501
1635
FAMOUS FOOTWEAR
CARRIER TOWNE CROSSING
3950 CARRIER PKWY #120
GRAND PRAIRIE
TX
75050
1647
FAMOUS FOOTWEAR
GREEN TREE RETAIL CENTER
19963 KATY FREEWAY
HOUSTON
TX
77094
1741
FAMOUS FOOTWEAR
FAIRWAY PLAZA
5762 FAIRMONT PARKWAY
PASADENA
TX
77505

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
1769
FAMOUS FOOTWEAR
COPPERWOOD VILLAGE
6875 HWY 6 N
HOUSTON
TX
77084
1788
FACTORY BRAND SHOES
CHELSEA OUTLET
820 W. STACY ROAD, SUITE 158
ALLEN
TX
75013
2034
FAMOUS FOOTWEAR
FORUM AT OLYMPIA PARK
8254 AGORA PARKWAY
SELMA
TX
78154
2065
FAMOUS FOOTWEAR
NORTHWEST MARKETPLACE
13784 NW FREEWAY
HOUSTON
TX
77040
2066
FAMOUS FOOTWEAR
CENTRE AT PRESTON RIDGE
3333 PRESTON ROAD, SUITE 403
FRISCO
TX
75034
2067
FAMOUS FOOTWEAR
WATAUGA TOWNE CROSSING
8004 DENTON HIGHWAY, SUITE 100
WATAUGA
TX
76148
2070
FAMOUS FOOTWEAR
CEDAR HILL CENTRE
420 D1 NORTH HWY 67
CEDAR HILL
TX
75104
2192
FAMOUS FOOTWEAR
TARGET/KOHL'S CENTER
20845 HWY 59
HUMBLE
TX
77338
2222
FAMOUS FOOTWEAR
TANGER FACTORY OUTLET/SAN MARCOS II
4015 I-35 EAST, STE. 1030
SAN MARCOS
TX
78666
2226
FAMOUS FOOTWEAR
GATEWAY SHOPPING CENTER
1117 N ALSBURY BLVD
BURLESON
TX
76028
2227
FAMOUS FOOTWEAR
RIVERSTONE SHOPPING CENTER
5754 HIGHWAY 6
MISSOURI CITY
TX
77459
2228
FAMOUS FOOTWEAR
SILVERLAKE SC
2750 FM 518
PEARLAND
TX
77581
2245
FAMOUS FOOTWEAR
LOUETTE CENTRAL
20630 I-45 NORTH
SPRING
TX
77373
2269
FAMOUS FOOTWEAR
MARKETPLACE AT TOWNE CENTRE
19075 LYNDON B JOHNSON FWY
MESQUITE
TX
75150
2291
FAMOUS FOOTWEAR
DENTON CROSSING
1800 LOOP 288 BLVD 1 # 107
DENTON
TX
76205
2304
FAMOUS FOOTWEAR
MANSFIELD TOWNE CROSSING
1821 N. HIGHWAY 287
MANSFIELD
TX
75248
2305
FAMOUS FOOTWEAR
HIGHLANDS AT FLOWER MOUND
6101 LONG PRAIRIE ROAD # 400
FLOWER MOUND
TX
75028
2312
FAMOUS FOOTWEAR
TOMBALL PARKWAY RETAIL CENTER
22517 TOMBALL PARKWAY
HOUSTON
TX
77070

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
2358
FAMOUS FOOTWEAR
SHERMAN TOWN CENTER
3912 TOWN CENTER
SHERMAN
TX
75092
2366
FAMOUS FOOTWEAR
ROUND ROCK SHOPPING CENTER
3021 S. I-35  SUITE 220
ROUND ROCK
TX
78664
2379
FAMOUS FOOTWEAR
MEMORIAL CITY MALL
344 MEMORIAL HALL
HOUSTON
TX
77024
2397
FAMOUS FOOTWEAR
ELDORADO PLAZA
2950 CRAIG DRIVE
MCKINNEY
TX
75070
2448
FAMOUS FOOTWEAR
VALLEY VIEW CENTER
1060 VALLEY VIEW CENTER
DALLAS
TX
75240
2449
FAMOUS FOOTWEAR
SAN ANGELO CENTER
4175 SUNSET DRIVE
SAN ANGELO
TX
76904
2450
FAMOUS FOOTWEAR
CYPRESS TOWN CENTER
25847 HIGHWAY 290
CYPRESS
TX
77429
2471
FAMOUS FOOTWEAR
KATY MILLS
5000 KATY MILLS CIRCLE, SUITE 549
KATY
TX
77494
2510
FAMOUS FOOTWEAR
SHOPS @ WILLOW BEND
2403 DALLAS PARKWAY  SPACE C-105
PLANO
TX
75093
2511
FAMOUS FOOTWEAR
MONTGOMERY PLAZA
351 CARROLL STREET
FORT WORTH
TX
76107
2512
FAMOUS FOOTWEAR
SHOPS @ NORTH EAST MALL
833 NORTH EAST MALL BLVD.  (0E03)
HURST
TX
76053
2535
FAMOUS FOOTWEAR
LAKE WORTH TOWNE CENTER
6594 LAKE WORTH BLVD.
LAKE WORTH
TX
76135
2556
FAMOUS FOOTWEAR
PORTOFINO SHOPPING CENTER
19075 I-45 SOUTH
CONROE
TX
77385
2564
FAMOUS FOOTWEAR
BROWNSVILLE TOWN CENTER
515 E MORRISON ROAD
BROWNSVILLE
TX
78526
2575
FAMOUS FOOTWEAR
THE RIM
17802 LACANTERA PKWY # 108
SAN ANTONIO
TX
78257
2584
FAMOUS FOOTWEAR
ARLINGTON HIGHLANDS
4000 RETAIL CONNECTION WAY
ARLINGTON
TX
76018
2589
FAMOUS FOOTWEAR
COLLIN CREEK MALL
811 NORTH CENTRAL EXPRESSWAY  SPACE 105
PLANO
TX
75075
2594
FAMOUS FOOTWEAR
THE SHOPS @ GALLERIA
12909 SHOPS PARKWAY  SUITE 400
BEE CAVE
TX
78738

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS CITY   STATE   ZIP/MAIL CODE
2601
FAMOUS FOOTWEAR
BRAZOS TOWNE CENTER
24126 COMMERCIAL DRIVE
ROSENBERG
TX
77471
2604
FAMOUS FOOTWEAR
SHARYLAND TOWNE CROSSING
2515 E US EXPRESSWAY 83  SUITE B-2
MISSION
TX
78572
2605
FACTORY BRAND SHOES
ROUND ROCK PREMIUM OUTLETS
4401 NORTH I H 35
ROUND ROCK
TX
78664
2606
FACTORY BRAND SHOES
RIO  GRANDE VALLEY PREMIUM
5001 E EXPRESSWAY # 83
MERCEDES
TX
78570
2612
FAMOUS FOOTWEAR
VICTORIA CROSSINGS
7920 NE ZAC LENTZ PARKWAY
VICTORIA
TX
77904
2614
FAMOUS FOOTWEAR
THE SHOPS @ ARBOR WALK
10515 N. MOPAC EXPRESSWAY  SUITE # 130
AUSTIN
TX
78759
2645
FAMOUS FOOTWEAR
WESTWOOD VILLAGE
32866 FM 2978
MAGNOLIA
TX
77354
2648
FAMOUS FOOTWEAR
WESLAYAN PLAZA
5510 WESLAYAN STREET
HOUSTON
TX
77005
2655
FAMOUS FOOTWEAR
RIVER OAKS PLAZA
1430 GRAY AVENUE  SPACE 1430
HOUSTON
TX
77019
2656
FACTORY BRAND SHOES
THE OUTLETS SHOPPES @ EL PASO
7051 S. DESERT BLVD. # 446
EL PASO (CANTUILLO)
TX
79835
2666
FAMOUS FOOTWEAR
THE SHOPS @ VINEYARD VILLAGE
2800 STATE HIGHWAY 121  SUITE 900
EULESS
TX
76039
2667
FAMOUS FOOTWEAR
GRAND PRAIRIE TOWN CROSSINGS
5256 S STATE HIGHWAY 360  SUITE 820
GRAND PRAIRIE
TX
75052
2680
FAMOUS FOOTWEAR
LONGVIEW TOWN CROSSING
3096 N EASTMAN ROAD # 102
LONGVIEW
TX
75605
2690
FAMOUS FOOTWEAR
RICHLAND PAVILION
4600 GARTH ROAD
BAYTOWN
TX
77521
2691
FAMOUS FOOTWEAR
WESTHEIMER TOWNE CENTER
8555 WESTHEINER ROAD
HOUSTON
TX
77063
2711
FAMOUS FOOTWEAR
ROCKWALL CROSSING
975 EAST I-30
ROCKWALL
TX
75087
2718
FAMOUS FOOTWEAR
RMMA SOUTH REGIONAL RETAIL
1201 BARBARA JORDAN BLVDSD. # 4
AUSTIN
TX
78723

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS CITY   STATE   ZIP/MAIL CODE
2748
FAMOUS FOOTWEAR
ATASCOCITA COMMONS SHOPPING CENTER
7021 FM 1960 EAST
ATASCOCIAT (HUMBLE)
TX
77338
2765
FAMOUS FOOTWEAR
SUNSET VALLEY HOMESTEAD
5207 BRODIE LANE  SUITE 190
SUNSET VALLEY ( AUSTIN)
TX
78745
2774
FAMOUS FOOTWEAR
LAKE JACKSON MARKETPLACE
201 A HIGHWAY 332 WEST  SUITE 400
LAKE JACKSON
TX
77566
2775
FAMOUS FOOTWEAR
BROADWAY MARKET CENTER
4901 SOUTH BROADWAY
TYLER
TX
75703
2778
FAMOUS FOOTWEAR
WEATHERFORD RIDGE
225 ADAMS DRIVE
WEATHERFORD
TX
76086
2787
FAMOUS FOOTWEAR
UNIVERSITY OAKS SHOPPING CENTER
201 UNIVERSITY OAKS  # 300
ROUND ROCK
TX
78665
2788
FAMOUS FOOTWEAR
PAVILLION COURT
16631 N COIT ROAD  SUITE 120
DALLAS
TX
75248
2895
FAMOUS FOOTWEAR
1890 RANCH TOWN CENTER
1335 WHITESTONE BLVD.   # E-100
CEDAR PARK
TX
78613
2896
FACTORY BRAND SHOES
HOUSTON PREMIUM OUTLETS
29300 HEMPSTEAD ROAD  SUITE 228
CYPRESS
TX
77433
93302
NATURALIZER
VALLEY VIEW CENTER
13331 PRESTON ROAD SUITE # 2016
DALLAS
TX
75240
93307
NATURALIZER
THE PARKS MALL
3811 SOUTH COOPER, STE. 1108
ARLINGTON
TX
76015
93352
NATURALIZER
HOUSTON GALLERIA
5135 W. ALABAMA STREET  SUITE 5150 C
HOUSTON
TX
77056
93363
NATURALIZER
WILLOWBROOK MALL
1220 WILLOWBROOK MALL
HOUSTON
TX
77070
93367
NATURALIZER
LAPLAZA MALL
2200 S. 10TH
MCALLEN
TX
78503
93378
NATURALIZER
BAYBROOK MALL
1050 BAYBROOK MALL
HOUSTON
TX
77546
93395
NATURALIZER
SOUTH PLAINS MALL
BOX 68213, 6002 SLIDE ROAD
LUBBOCK
TX
79414
93418
NATURALIZER
CIELO VISTA MALL
8401 GATEWAY WEST SP F-01
EL PASO
TX
79925

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   STATE   ZIP/MAIL CODE
96611
NATURALIZER OUTLET
HOUSTON PREMIUM OUTLETS
29300 HEMPSTEAD ROAD  SUITE 111
CYPRESS
TX
77433
96614
NATURALIZER OUTLET
TANGER OUTLET CENTER
4015 I-35 STE 338 E
SAN MARCOS
TX
78666
96617
NATURALIZER OUTLET
ALLEN PREMIUM OUTLETS
820 W. STACY ROAD SUITE 0172
ALLEN
TX
75013
96627
NATURALIZER OUTLET
RIO  GRANDE VALLEY PREMIUM
5001 E. EXPRESSWAY 83, SUITE # 423
MERCEDES
TX
78570
96628
NATURALIZER OUTLET
ROUND ROCK PREMIUM OUTLETS
4401 NORTH I H 35
ROUND ROCK
TX
78664
96629
NATURALIZER OUTLET
THE OUTLETS SHOPPES @ EL PASO
7051 S. DESERT BLVD. # E- 549
EL PASO (CANTUILLO)
TX
79835
96718
NATURALIZER OUTLET
GRAPEVINE MILLS
3000 GRAPEVINE MILLS PKWY, SPACE 320
GRAPEVINE
TX
76051
96733
NATURALIZER OUTLET
SOUTHWEST OUTLET CENTER
104 INTERSTATE 35 NE #152
HILLSBORO
TX
76645
96734
NATURALIZER OUTLET
CONROE OUTLET CENTER
1111 LEAGUE LINE ROAD, SPACE 108
CONROE
TX
77304
96796
NATURALIZER OUTLET
KATY MILLS
5000 KATY MILLS CIRCLE, SUITE 647
KATY
TX
77494
99109
BROWN SHOE CLOSET
HOUSTON PREMIUM OUTLETS
29300 HENPSTEAD ROAD SUITE 112
CYPRESS
TX
77433
99117
BROWN SHOE CLOSET
THE OUTLETS SHOPPES @ EL PASO
7051 S DESERT BLVD. # B-257
EL PASO
TX
79835
25
FAMOUS FOOTWEAR
FACTORY STORES/PARK CITY
6699 N. LANDMARK DR. C120
PARK CITY
UT
84098
1380
FAMOUS FOOTWEAR
SOUTH TOWNE MALL
10450 S. STATE S. CTR  STE 1322
SANDY
UT
84070
1381
FAMOUS FOOTWEAR
NEWGATE MALL
1022 NEWGATE MALL
OGDEN
UT
84405
1397
FAMOUS FOOTWEAR
FACTORY STORES OF AMERICA
12101 S. FCTRY OTLTDR#130
DRAPER
UT
84020

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #     TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
1427
FAMOUS FOOTWEAR
LAKE POINT SHOPPING CENTR
292 W 1300 S
OREM
UT
84058
1648
FAMOUS FOOTWEAR
ZION FACTORY STORES
250 N.RED CLIFF DR SUITE # 29
ST GEORGE
UT
84770
1727
FAMOUS FOOTWEAR
CACHE VALLEY MALL
1300 N. MAIN ST #1201
LOGAN
UT
84341
2049
FAMOUS FOOTWEAR
WEST JORDAN LANDING
7099 S. PLAZA CENTER DR.
WEST JORDAN
UT
84084
2134
FAMOUS FOOTWEAR
COMMONS @ SUGAR HOUSE
1170 E. 2100 S. SUITE A
SALT LAKE CITY
UT
84106
2137
FAMOUS FOOTWEAR
PROVO TOWNE CENTER
1200 TOWN CENTER RD, SPACE 1014
PROVO
UT
84601
2184
FAMOUS FOOTWEAR
GATEWAY CROSSING
420 S 500 WEST, SUITE 115
WEST BOUNTIFUL
UT
84010
2384
FAMOUS FOOTWEAR
ALPINE CENTER
656 WEST MAIN STREET
AMERICAN FORK
UT
84003
2414
FAMOUS FOOTWEAR
TAYLORSVILLE FAMILY CENTER
5688 S. REDWOOD ROAD
TAYLORSVILLE
UT
84123
2431
FAMOUS FOOTWEAR
LAYTON HILLS MALL
2040 LAYTON HILLS MALL
LAYTON
UT
84041
2432
FAMOUS FOOTWEAR
THE GATEWAY
32 N RIO GRANDE
SALT LAKE CITY
UT
84101
2433
FAMOUS FOOTWEAR
DRAPER PEAKS
175 E 12300 S. SUITE 105
DRAPER
UT
84020
2465
FAMOUS FOOTWEAR
THE SHOPPES  @ LAKE PARK
2997 SOUTH, 5600 WEST
WEST VALLEY CITY
UT
84120
2591
FAMOUS FOOTWEAR
THE DISTRICT @ SOUTH JORDAN
11571 S. PARKWAY PLAZA DRIVE
SOUTH JORDAN
UT
84095
2692
FAMOUS FOOTWEAR
RIVERDALE CENTER
4267 S. RIVERDALE ROAD
RIVERDALE
UT
84405
2754
FAMOUS FOOTWEAR
FAMILY CENTER @ FORT UNION
990 EAST FORT UNION ROAD  # 52
MIDVALE
UT
84047
2773
FAMOUS FOOTWEAR
LAYTON MARKET PLACE
1934 N. WOODLAND PARK DR
LAYTON
UT
84041
96620
NATURALIZER OUTLET
TANGER OUTLET CENTER
6699 N. LANDMARK DRIVE  A-105
PARK CITY
UT
84098

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

    STORE #     TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
180
FAMOUS FOOTWEAR
POTOMAC MILLS MALL
2700 POTOMAC MILLS CIRCLE
WOODBRIDGE
VA
22192
196
FAMOUS FOOTWEAR
ROLLING VALLEY MALL
9272 OLD KEENE MILL RD
BURKE
VA
22015
198
FAMOUS FOOTWEAR
FAIR CITY MALL
9658 MAIN STREET
FAIRFAX
VA
22031
409
FAMOUS FOOTWEAR
LTD MALL
6401 RICHMOND RD.
LIGHTFOOT
VA
23090
1672
FAMOUS FOOTWEAR
LEESBURG PREMIUM OUTLET
241 FT EVANS RD NE #307
LEESBURG
VA
20176
1744
FAMOUS FOOTWEAR
PARKRIDGE CENTER
11146 BULLOCH DRIVE
MANASSAS
VA
20109
1755
FAMOUS FOOTWEAR
WINCHESTER COMMONS
2320 LEGGE BLVD
WINCHESTER
VA
22601
2031
FAMOUS FOOTWEAR
COMMONWEALTH CENTRE
4801 COMMONWEALTH CENTRE
MIDLOTHIAN
VA
23112
2237
FAMOUS FOOTWEAR
5970 KINGSTOWNE TOWNE CENTER
MANCHESTER BLVD
ALEXANDRIA
VA
22315
2438
FAMOUS FOOTWEAR
STAFFORD MARKETPLACE
1150 STAFFORD MARKETPLACE
STAFFORD
VA
22556
2520
FAMOUS FOOTWEAR
WARDS CROSSINGS
475 A SIMONS RUN
LYNCHBURG
VA
24502
2632
FAMOUS FOOTWEAR
BRECKENRIDGE SHOPPING CENTER
2639 W OLD HUNDRED ROAD
CHESTER
VA
23831
2633
FAMOUS FOOTWEAR
HANOVER SQUARE SHOPPING CENTER
7230 BELL CREEK ROAD  SUITE D
MECHANICSVILLE
VA
23111
2634
FAMOUS FOOTWEAR
CROOKED RUN CENTER
135 CROOKED RUN PLAZA # 130
FRONT ROYAL
VA
22630
2696
FAMOUS FOOTWEAR
CULPEPER MARKETPLACE
787 NALLES MILL ROAD
CULPEPER
VA
22701
2768
FAMOUS FOOTWEAR
STAPLES MILL SQUARE
9057 STAPLES MILL ROAD
RICHMOND
VA
23228
2769
FAMOUS FOOTWEAR
CENTRAL PARK SHOPPING CENTER
1666 CARL D. SILVER PARKWAY
FREDERICKSBURG
VA
22401
2770
FAMOUS FOOTWEAR
REGENCY SQUARE MALL
1420 PARHAM ROAD SPACE R-121
RICHMOND
VA
23229
2782
FAMOUS FOOTWEAR
CENTER @ INNOVATION
10046 SOWDER VILLAGE SQUARE
MANASSAS
VA
20109
2785
FAMOUS FOOTWEAR
COSNERS CORNER SHOPPING CENTER
9681 JEFFERSON DAVIS HIGHWAY
FREDERICKSBURG
VA
22407
2812
FAMOUS FOOTWEAR
FORT EVANS PLAZA II
530 A FORT EVANS ROAD
LEESBURG
VA
20176

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #     TRADE/STORE NAME    MALL/SHOPPING CENTER     ADDRESS    CITY   STATE   ZIP/MAIL CODE
2903
FAMOUS FOOTWEAR
TYSONS STATION
7502 LEESBURG PIKE
FALLS CHURCH
VA
22043
91597
NATURALIZER
GREENBRIER MALL
1401 GREENBRIER PARKWAY # 2194
CHESAPEAKE
VA
23320
96634
NATURALIZER OUTLET
PRIME OUTLETS AT WILLIAMSBURG
5709 RICHMOND ROAD  SPACE 64
WILLIAMSBURG
VA
23188
96642
NATURALIZER OUTLET
POTOMAC MILLS MALL
2700 POTOMAC MILLS CIRCLE
WOODBRIDGE
VA
22192
96790
NATURALIZER OUTLET
LEESBURG CORNER PREMIUM OUTLETS
241 FORT EVANS ROAD, N.E., SUITE 1127
LEESBURG
VA
20176
99114
BROWN SHOE CLOSET
PRIME OUTLETS AT WILLIAMSBURG
5709-68 RICHMOND RD. (TEMP SPACE)
WILLIAMSBURG
VA
23188
99176
BROWN SHOE CLOSET
LEESBURG CORNER PREMIUM OUTLETS
241 FORT EVANS ROAD, N.E., SUITE 621
LEESBURG
VA
20176
1586
FAMOUS FOOTWEAR
ESSEX OUTLET CENTER
21 ESSEX WAY-SUITE 103
ESSEX
VT
05451
2364
FACTORY BRAND SHOES
ROUTE 11/30 & ROUTE 7 A
96 DEPOT STREET
MANCHESTER
VT
05255
2547
FAMOUS FOOTWEAR
BURLINGTON TOWN CENTER
49 CHURCH STREET  # 2050
BURLINGTON
VT
05401
226
FAMOUS FOOTWEAR
GREAT NORTHWEST FACTORY
461 S. FORK AVE. S.W. #Q
NORTH BEND
WA
98045
298
FAMOUS FOOTWEAR
SUPER MALL OF GREAT N.W.
1101 SUPERMALL WAY #1256
AUBURN
WA
98001
971
FAMOUS FOOTWEAR
PRIME OUTLETS @BURLINGTON
424 FASHION WAY
BURLINGTON
WA
98233
1201
FAMOUS FOOTWEAR
SOUTHSHORE MALL
1017 S. BOONE ST.
ABERDEEN
WA
98520
1277
FAMOUS FOOTWEAR
BROADMOOR FACTORY OUTLET
5216 OUTLET DRIVE
PASCO
WA
99301
1320
FAMOUS FOOTWEAR
WESTFIELD SHOPPINGTOWN
8700 N E. VANCOUVER MALL  # 203
VANCOUVER   (CITY)
WA
98662

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #   TRADE/STORE NAME    MALL/SHOPPING CENTER     ADDRESS   CITY   STATE   ZIP/MAIL CODE
1547
FAMOUS FOOTWEAR
EVERETT MALL
1402 SE EVERETT-STE #8&9
EVERETT
WA
98208
1599
FAMOUS FOOTWEAR
SPOKANE VALLEY MALL
14700 E.INDIANA-SP 2058
SPOKANE
WA
99216
1685
FAMOUS FOOTWEAR
THREE RIVERS MALL
351 THREE RIVERS DRIVE
KELSO
WA
98626
1729
FAMOUS FOOTWEAR
NORTHTOWN MALL
4750 N. DIVISION
SPOKANE
WA
99207
1798
FAMOUS FOOTWEAR
CENTRALIA FACTORY OUTLET
1332 LUM ROAD
CENTRALIA
WA
98531
2075
FAMOUS FOOTWEAR
TOTEM LAKE
12634 TOTEM LAKE BLVD.
KIRKLAND
WA
98034
2078
FAMOUS FOOTWEAR
COOPER POINT MARKETPLACE
1200 COOPER POINT RD. SW
OLYMPIA
WA
98502
2106
FAMOUS FOOTWEAR
KITSAP MALL
10315 SILVERDALE WAY NW P.O. BOX 1902
SILVERDALE
WA
98383
2154
FAMOUS FOOTWEAR
DOWNTOWN WOODINVILLE
17955 GARDEN WAY NE
WOODINVILLE
WA
98072
2155
FAMOUS FOOTWEAR
VALLEY MALL PLAZA
1724 E. WASHINGTON  AVE
UNION GAP
WA
98903
2194
FAMOUS FOOTWEAR
ALDERWOOD PARKWAY
19225 ALDERWOOD MALL PKWY
LYNNWOOD
WA
98036
2221
FAMOUS FOOTWEAR
GIG HARBOR NORTH
5151 BORGEN BLVD
GIG HARBOR
WA
98332
2279
FAMOUS FOOTWEAR
THE COLONADE
6705 W CANAL DR STE B
KENNEWICK
WA
99336
2347
FAMOUS FOOTWEAR
SEATTLE PREMIUM OUTLETS
10600 QUIL CEDA VILLAGE  # 226
TULALIP
WA
98271
2360
FAMOUS FOOTWEAR
VALLEY NORTH CENTER
1350 NORTH MILLER STREET
WENATCHEE
WA
98801
2370
FAMOUS FOOTWEAR
LAKEWOOD TOWNE CENTER - PHASE III
10330 59TH AVENUE SW  STE C
LAKEWOOD
WA
98499
2394
FAMOUS FOOTWEAR
WESTWOOD VILLAGE
2511 SW TRENTON STREET
SEATTLE
WA
98106
2415
FAMOUS FOOTWEAR
HAZEL DELL TOWN CENTER
8810 N.E. 5TH AVENUE
VANCOUVER  UNIC PTBA
WA
98665
2428
FAMOUS FOOTWEAR
SEA TAC MALL
1804 SOUTH COMMONS
FEDERAL WAY
WA
98031
2442
FAMOUS FOOTWEAR
WINNER BUILDING
17401 SOUTHCENTER PARKWAY
TUKWILA
WA
98188
2444
FAMOUS FOOTWEAR
PICKERING PLACE
1520 11TH AVENUE NW
ISSAQUAH
WA
98027

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

   STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
2466
FAMOUS FOOTWEAR
BELLIS FAIR MALL
1 BELLISFAIR PKWY  # 310
BELLINGHAM
WA
98226
2483
FAMOUS FOOTWEAR
BURLINGTON CROSSINGS
1882 MARKETPLACE DRIVE
BURLINGTON
WA
98233
2515
FAMOUS FOOTWEAR
LAKEWOOD PLAZA
17020 TWIN LAKES AVENUE  SUITE CD 100
MARYSVILLE
WA
98271
2610
FAMOUS FOOTWEAR
SOUTH HILLS MALL
3500 S. MERIDIAN DR, SUITE 650
PUYALLUP
WA
98373
2736
FAMOUS FOOTWEAR
JUNCTION 192
9301 192ND AVE E
BONNEY LAKE
WA
98391
2744
FAMOUS FOOTWEAR
VINTNER SQUARE
2935 QUEENSGATE DRIVE
RICHLAND
WA
99352
2772
FAMOUS FOOTWEAR
LINCOLN PLAZA
2505 SOUTH 38TH ST  #A  113
TACOMA
WA
98409
2792
FAMOUS FOOTWEAR
KENT STATION
444 RAMSAY WAY SUITE 107
KENT
WA
98032
2803
FAMOUS FOOTWEAR
SUNRISE VILLAGE
10412 156TH STREET EAST
PUYALLUP
WA
98374
2842
FAMOUS FOOTWEAR
SNOHOMISH STATION
2709 BICKFORD AVENUE F
SNOHOMISH
WA
98396
93398
NATURALIZER
SOUTHCENTER MALL
271 SOUTHCENTER PARKWAY, SPACE F660
TUKWILA
WA
98188
96616
NATURALIZER OUTLET
SEATTLE PREMIUM OUTLETS
10600 QUIL CEDA VILLAGE  # 328
TULALIP
WA
98271
96647
NATURALIZER OUTLET
FACTORY STORES AT NORTH BEND
521 SOUTH FORK AVE. SW SUITE 521-J
NORTH BEND
WA
98045
96775
NATURALIZER OUTLET
SUPER MALL OF THE GREAT NORTHWEST
1101 SUPER MALL WAY, SUITE 1248
AUBURN
WA
98001
2
FAMOUS FOOTWEAR
WESTGATE MALL
146 WESTGATE MALL
MADISON
WI
53711
72
FAMOUS FOOTWEAR
SOUTHGATE MALL
3333 SOUTH 27TH STREET
MILWAUKEE
WI
53215
191
FAMOUS FOOTWEAR
ESSEX SQUARE
4725 E. TOWN BLVD
MADISON
WI
53714
217
FAMOUS FOOTWEAR
WEST ALLIS TOWNE CENTER
6710 GREENFIELD
WEST ALLIS
WI
53214
525
FAMOUS FOOTWEAR
PRIME OUTLETS @OSHKOSH
3001 S WASHBURN ST #245
OSHKOSH
WI
54904
1343
FAMOUS FOOTWEAR
BAY PARK SQUARE S.C.
669 BAY PARK SQUARE
ASHWAUBENON
WI
54304

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER    ADDRESS    CITY   STATE   ZIP/MAIL CODE
1360
FAMOUS FOOTWEAR
OAKWOOD MALL
4800 GOLF ROAD
EAU CLAIRE
WI
54701
1515
FAMOUS FOOTWEAR
PRAIRIE TOWNE CENTER
247 JUNCTION RD-SPACE 247
MADISON
WI
53719
1533
FAMOUS FOOTWEAR
JOHNSON CREEK FACTORY
171 LINMAR LN-SP A-130
JOHNSON CREEK
WI
53038
1572
FAMOUS FOOTWEAR
FOX RIVER MALL
4301 W.WISCONSIN-SP 908
APPLETON
WI
54915
2380
FAMOUS FOOTWEAR
PINE TREE PLAZA
2900 DEERFIELD DR. STE # 7
JANESVILLE
WI
53546
2405
FAMOUS FOOTWEAR
VALLEY VIEW MALL
3800 STATE ROAD - 16, SPACE #1040
LA CROSSE
WI
54601
2423
FAMOUS FOOTWEAR
THE SHOPS @ GRAND AVENUE
275 W. WISCONSIN AVE.  SPACE 2040
MILWAUKEE
WI
53203
2436
FAMOUS FOOTWEAR
THE SHOPS @ NAGAWAUKEE
3272 GOLF ROAD
DELAFIELD
WI
53018
2477
FAMOUS FOOTWEAR
HORIZON PLAZA
3845 E. CALUMET STREET
APPLETON
WI
54915
2496
FACTORY BRAND SHOES
TANGER OUTLET CENTER
210 GASSER ROAD SUITE 551
BARABOO
WI
53913
2504
FAMOUS FOOTWEAR
OAK CREEK SHOPPING CENTER
8907 S HOWELL AVENUE  SUITE H
OAK CREEK
WI
53154
2565
FAMOUS FOOTWEAR
WAUSAU CENTER MALL
WAUSAU CENTER  D - 432
WAUSAU
WI
54403
2617
FACTORY BRAND SHOES
PRIME OUTLETS @ PLEASANT PRAIRIE
11211 120TH AVE.  SUITE 526
PLEASANT PRIARIE
WI
53158
2630
FAMOUS FOOTWEAR
GERMANTOWN COMMONS
N96 W18908 COUNTY LINE RD
GERMANTOWN
WI
53022
3004
WAREHOUSE OF SHOES
BLUEMOUND
17300 W. BLUEMOUND RD.
BROOKFIELD
WI
53045
3010
WAREHOUSE OF SHOES
SOUTHRIDGE
5000 S. 76TH ST.
GREENFIELD
WI
53220
3015
WAREHOUSE OF SHOES
MEQUON
11020 N. PORT WASHINGTON RD.
MEQUON
WI
53092
3021
WAREHOUSE OF SHOES
CUDAHY
5656 S. PACKARD AVE., SUITE A
CUDAHY
WI
53110

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - U.S. RETAIL STORES LEASED (as of January 1, 2009 )
(Continued)

  STORE #    TRADE/STORE NAME    MALL/SHOPPING CENTER   ADDRESS    CITY   STATE   ZIP/MAIL CODE
90830
NATURALIZER
BROOKFIELD SQUARE
95 N. MOORLAND ROAD, SPACE #D22
BROOKFIELD
WI
53005
96626
NATURALIZE OUTLET
TANGER OUTLET CENTER
210 GASSER ROAD SUITE 501
BARABOO
WI
53913
96731
NATURALIZER OUTLET
PRIME OUTLETS @ PLEASANT PRAIRIE
11211 120TH AVE.  SUITE 71
KENOSHA
WI
53142
1601
FAMOUS FOOTWEAR
FLATWOOD FACTORY SHOPS
216 SKIDMORE LANES- #B
SUTTON
WV
26601
2703
FAMOUS FOOTWEAR
POTOMAC MARKETPLACE
217 OAK LEE DRIVE  SUITE 20
RANSON
WV
25438
1686
FAMOUS FOOTWEAR
EASTRIDGE MALL
601 E. WYOMING BLVD.#1261
CASPER
WY
82609
1739
FAMOUS FOOTWEAR
WHITE MOUNTAIN MALL
2441 FOOTHILL BLVD.
ROCK SPRINGS
WY
82901
2714
FAMOUS FOOTWEAR
CHEYENNE MARKETPLACE
5116 RUE TERRE  FRONTIER MALL
CHEYENNE
WY
82009

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED
(as of January 1,  2009
 

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY PROVINCE   MAIL CODE
1400
F.X. LASALLE
SQUARE ONE SHOPPING CENTER
100 CITY CENTRE DRIVE
MISSISSAUGA
ON
L5B 2C9
1433
F.X. LASALLE
RIDEAU CENTRE
50 RIDEAU ST #334
OTTAWA
ON
K1N 9J7
1440
F.X. LASALLE
PLACE D'ORLEANS
110 PL. D'ORLEANS BOX 61
ORLEANS
ON
K1C 2L9
1500
F.X. LASALLE
EATON CENTRE
705 STE-CATHERINE O.
MONTREAL
QC
H3B 4G5
1501
F.X. LASALLE
GALERIE D'ANJOU
7999 BOUL. DES GALERIES D'ANJOU
ANJOU
QC
H1M 1W6
1502
F.X. LASALLE
LE CARREFOUR LAVAL
3035 BOUL. LE CARREFOUR
LAVAL
QC
H7T 1C7
1504
F.X. LASALLE
LES PROMENADES ST-BRUNO
120 BLVD. LES PROMENADES,  E-008A
ST-BRUNO
QC
J3V 5K1
1505
F.X. LASALLE
CENTRE-VILLE
1011 STE-CATHERINE OUEST
MONTREAL
QC
H3B 1H1
1506
F.X. LASALLE
CENTRE ROCKLAND
2305 CHEMIN ROCKLAND
VILLE MONT-ROYAL
QC
H3P 2Z3
1508
F.X. LASALLE
FAIRVIEW POINTE CLAIRE
6801 TRANSCANADIENNE
POINTE-CLAIRE
QC
H9R 1C2
1509
F.X. LASALLE
PLACE CHAMPLAIN
2151 BLVD.. LAPINIERE
BROSSARD
QC
J4W 2T5
1510
F.X. LASALLE
PLACE VILLE-MARIE
1 PL. VILLE-MARIE #11080
MONTREAL
QC
H3B 3Y1
1520
F.X. LASALLE
PLACE STE-FOY
2450 BLVD. LAURIER
STE-FOY
QC
G1V 2L1
1523
F.X. LASALLE
GALERIES DE LA CAPITALE
5401 BLVD. DES GALERIES
QUEBEC
QC
G2K 1N4
1525
F.X. LASALLE
CENTRE LES RIVIERES
4125 BLVD. DES FORGES
TROIS-RIVIERES
QC
G8Y 1W1
2052
NATURALIZER
RICHMOND CENTRE
6060 MINORI BLVD.
RICHMOND
BC
V6Y 2V7


 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   PROVINCE   MAIL CODE
2053
NATURALIZER
COQUITLAM CENTRE
2929 BARNET HWY, STE 521
PORT COQUITLAM
BC
V3B 5R5
2061
NATURALIZER
GUILDFORD TOWN CENTRE
2538 GUILFORD TOWN CTR.
SURREY
BC
V3R 7C1
2062
NATURALIZER
METROPOLIS AT METROTOWN
4700 KINGSWAY AVE
BURNABY
BC
V5H 4M1
2065
NATURALIZER
WILLOWBROOK
19705 FRASER HWY
LANGLEY
BC
V3A 7E9
2066
NATURALIZER
SEVENOAKS
32900 S. FRASER WAY
ABBOTSFORD
BC
V2S 5A1
2070
NATURALIZER
MAYFAIR SHOPPING CENTER
3147 DOUGLAS STREET
VICTORIA
BC
V8Z 6E3
2071
NATURALIZER
HILLSIDE SHOPPING CENTRE
1644 HILLSIDE
VICTORIA
BC
V8T 2C5
2075
NATURALIZER
WOODGROVE CENTRE
338-6631 ISLAN HWY N.
NANAIMO
BC
V9T 4T7
2080
NATURALIZER
ORCHARD PARK SHOPPING CENTRE
2271 HARVEY AVENUE
KELOWNA
BC
V1Y 6H2
2150
NATURALIZER
BONNIE DOON SHOPPING CENTRE
82ND AVE AND 83RD STREET
EDMONTON
AB
T6C 4E3
2154
NATURALIZER
KINGSWAY GARDEN MALL
109TH STREET & PR. ELIZABETH
EDMONTON
AB
T5G 3A6
2159
NATURALIZER
LONDONDERRY
137TH AVENUE & 66TH STREET
EDMONTON
AB
T5C 3C8
2160
NATURALIZER
SOUTHGATE CENTRE
11100 51ST AVENUE
EDMONTON
AB
T6H 4M6
2161
NATURALIZER
WEST EDMONTON MALL
8882 170TH STREET, SPACE 2346
EDMONTON
AB
T5T4M2
2171
NATURALIZER
BOWER PLACE
4900 MOLLY BANISTER DR., STE. 108
RED DEER
AB
T4R 1N9
2180
NATURALIZER
SUNRIDGE MALL
2525 36TH STREET N.E.
CALGARY
AB
T1Y 5T4
2181
NATURALIZER
MARKET MALL
3625 SHAGANAPPI TRAIL N.W.
CALGARY
AB
T2J 0E2
2182
NATURALIZER
SOUTHCENTRE MALL
100 ANDERSON ROAD S.E.
CALGARY
AB
T2J 3V1
2183
NATURALIZER
CHINOOK CENTRE
6455 MACLEOD TRAIL S.W.
CALGARY
AB
T2H 0K3

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

   STORE #    TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS   CITY   PROVINCE   MAIL CODE
2185
NATURALIZER
NORTH HILL CENTRE
1632 14TH AVENUE N.W.
CALGARY
AB
T2N 1M7
2188
NATURALIZER
TD SQUARE MALL
317 7TH AVENUE S.W.
CALGARY
AB
T2P 2Y9
2191
NATURALIZER
PARK PLACE SHOPPING CENTER
501 1ST STREET SOUTH
LETHBRIDGE
AB
T1J 4L9
2195
NATURALIZER
MEDICINE HAT MALL
3292 DUNMORE RD SE
MEDECINE HAT
AB
T1B 2R4
2253
NATURALIZER
SOUTHLAND MALL
2965 GORDON ROAD
REGINA
SK
S4S 6H7
2271
NATURALIZER
MIDTOWN PLAZA
21ST STREET & FIRST AVENUE S
SASKATOON
SK
S7K 1J9
2272
NATURALIZER
THE CENTRE AT CIRCLE & EIGHTH
3310 8TH STREET EAST
SASKATOON
SK
S7H 5M3
2350
NATURALIZER
POLO PARK SHOPPING CENTRE
1485 PORTAGE AVENUE
WINNIPEG
MB
R3G 0W4
2353
NATURALIZER
ST VITAL CENTRE
1225 ST. MARY ROAD
WINNIPEG
MB
R2M 5E5
2354
NATURALIZER
KILDONAN PLACE
1555 REGENT AVENUE WEST
WINNIPEG
MB
R2C 3B3
2417
NATURALIZER
PICKERING TOWN CENTRE
1355 KINGSTON RD
PICKERING
ON
L1V 1B8
2424
NATURALIZER
PEN CENTRE
221GLENDALE AVENUE
ST. CATHARINES
ON
L2T 2K9
2430
NATURALIZER
LAMBTON MALL
1380 LONDON ROAD
SARNIA
ON
N7S 1P8
2432
NATURALIZER
ST. LAURENT SHOPPING CENTRE
1200 ST LAURENT BLVD #519
OTTAWA
ON
K1K 3B8
2440
NATURALIZER
CARLINGWOOD SHOPPING CENTRE
2121 CARLING AVENUE
OTTAWA
ON
K2A 1H2
2450
NATURALIZER
SQUARE ONE
100 CITY CTR DRIVE
MISSISSAUGA
ON
L5B 2C9
2451
NATURALIZER
ERIN MILLS TOWN CENTRE
5100 ERIN MILLS PARKWAY
MISSISSAUGA
ON
L5M 4Z5
2452
NATURALIZER
SHERWAY GARDENS
25 THE WEST MALL
ETOBICOKE
ON
M9C 1B8

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   PROVINCE   MAIL CODE
2453
NATURALIZER
CLOVERDALE MALL
250 THE EAST MALL #127
ETOBICOKE
ON
M9B 3Y8
2455
NATURALIZER
YORKDALE SHOPPING CENTER
3401 DUFFERIN STREET
TORONTO
ON
M6A 3A1
2456
NATURALIZER
SCARBOROUGH TOWN CENTRE
300 BOROUGH DRIVE
SCARBOROUGH
ON
M1P 4P5
2458
NATURALIZER
YONGE-EGLINTON CENTER
2300 YONGE ST. #C27
TORONTO
ON
M4P 1E4
2462
NATURALIZER
HILLCREST MALL
9350 YONGE STREET
RICHMOND HILL
ON
L4C 5G2
2463
NATURALIZER
CENTERPOINT
6248 YONGE ST #47
WILLOWDALE
ON
M2M 3X4
2464
NATURALIZER
MARKVILLE SHOPPING CENTER
5000 HWY & MCCOWAN ROAD
MARKHAM
ON
L3R 4M9
2466
NATURALIZER
BRAMALEA SHOPPING CENTRE
25 PEEL CENTRE DRIVE
BRAMPTON
ON
L6T 3R5
2467
NATURALIZER
OSHAWA
419 KING STREET WEST
OSHAWA
ON
L1J 2K5
2468
NATURALIZER
UPPER CANADA MALL
17600 YONGE STREET
NEWMARKET
ON
L3Y 4Z1
2469
NATURALIZER
GEORGIAN MALL
509 BAYFIELD STREET
BARRIE
ON
L4M 4Z8
2470
NATURALIZER
MAPLEVIEW CENTRE
900 MAPLE AVENUE
BURLINGTON
ON
L7S 2J8
2471
NATURALIZER
LIME RIDGE MALL
999 UPPER WENTWORTH STREET
HAMILTON
ON
L9A 4X5
2475
NATURALIZER
LYNDEN PARK
84 LYNDEN ROAD
BRANTFORD
ON
N3R 6B8
2481
NATURALIZER
FAIRVIEW PARK
HWY. 8 E. & FAIRWAY RD.
KITCHENER
ON
N2C 1X1
2482
NATURALIZER
CONESTOGA MALL
550 KING STREET NORTH
WATERLOO
ON
N2L 5W6
2484
NATURALIZER
WHITE OAKS MALL
1105 WELLINGTON ROAD ST.
LONDON
ON
N6E 1V4
2489
NATURALIZER
DEVONSHIRE MALL
3100 HOWARD AVENUE
WINDSOR
ON
N8X 3Y8

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   PROVINCE   MAIL CODE
2490
NATURALIZER
PLACE D'ORLEANS
110 PLACE D'ORLEANS DR. #608
ORLEANS
ON
K1C 2L9
2491
NATURALIZER
BAYSHORE CENTRE
100 BAYSHORE DRIVE
OTTAWA
ON
K2B 8C1
2492
NATURALIZER
BILLINGS BRIDGE PLAZA
2269 RIVERSIDE DRIVE
OTTAWA
ON
K1H 8K2
2493
NATURALIZER
240 SPARKS
240 SPARKS STREET
OTTAWA
ON
K1P 6C9
2494
NATURALIZER
CATARAQUI TOWN CENTRE
945 GARDINERS ROAD
KINGSTON
ON
K7M 7H4
2496
NATURALIZER
CORNWALL SQUARE
1 WATER STREET EAST
CORNWALL
ON
K6H 6M2
2497
NATURALIZER
HAZELDEAN MALL
300 EAGLESON ROAD #34
KANATA
ON
K2M 1C9
2498
NATURALIZER
QUINTE MALL
390 NORTH FRONT STREET
BELLEVILLE
ON
K8P 3E1
2500
NATURALIZER
COMPLEXE LES AILES
677 STE-CATHERINE O
MONTREAL
QC
H3B 5K4
2551
NATURALIZER
GALERIES D'ANJOU
7999 BOUL. DES GALERIES D'AJOU
VILLE D'ANJOU
QC
H1M 1W9
2552
NATURALIZER
LE CARREFOUR LAVAL
3035 BOUL. LE CARREFOUR
LAVAL
QC
H7T 1C7
2553
NATURALIZER
PLACE VERSAILLES
7275 SHERBROOKE EST #100
MONTREAL
QC
H1N 1E9
2554
NATURALIZER
PROMENADES ST-BRUNO
239 BOUL. DES PROMENADES
ST-BRUNO
QC
J3V 5J5
2556
NATURALIZER
CENTRE ROCKLAND
2305 CHEMIN ROCKLAND
VILLE MONT-ROYAL
QC
H3P 3E9
2558
NATURALIZER
FAIRVIEW POINTE CLAIRE
6801 TRANSCANADIENNE
POINTE-CLAIRE
QC
H9R 5J2
2559
NATURALIZER
MAIL CHAMPLAIN
2151 BOUL. LAPINIERE
BROSSARD
QC
J4W 2T5
2560
NATURALIZER
CENTRE VALLEYFIELD
50 DUFFERIN #240
VALLEYFIELD
QC
J6S 4W4
2561
NATURALIZER
CARREFOUR RICHELIEU
600 RUE PIERRE CAISSE #20
ST-JEAN
QC
J3A 1M1
2562
NATURALIZER
PLACE BOURASSA
6000 HENRI-BOURASSA EAST
MONTREAL-NORD
QC
H1G 2T6
2563
NATURALIZER
FAUBOURG DE I'LLE
101 BOUL. CARDINAL LEGER
PINCOURT
QC
J7V 3Y3

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER    ADDRESS   CITY   PROVINCE   MAIL CODE
2564
NATURALIZER
CENTRE REGIONAL CHATEAUGUAY
200 BOUL. D'ANJOU
CHATEAUGUAY
QC
J6K 1C5
2565
NATURALIZER
LE BOULEVARD CENTRE COMMERCIAL
4118 JEAN-TALON EST.
ST-LEONARD
QC
H1S 1J7
2567
NATURALIZER
CENTRE LAVAL
1600 BOUL. LE CORBUSIER
LAVAL
QC
H7S 1Y9
2568
NATURALIZER
PLACE LONGUEUIL
825 ST-LAURENT OUEST
LONGUEUIL
QC
J4K 2V1
2571
NATURALIZER
GALERIES DE GRANBY
40 BOUL. EVANGELINE
GRANBY
QC
J2G 8K1
2572
NATURALIZER
GALERIES ST-HYACINTHE
3200 LAFRAMBROISE
ST-HYACINTHE
QC
J2S 4Z5
2574
NATURALIZER
GRANDE PLACE DES BOIS-FRANCS
1111 BOUL. JUTRAS E. #45
ARTHABASKA
QC
G6S 1C1
2575
NATURALIZER
CENTRE LES RIVIERES
4375 BOUL. DES FORGES
TROIS-RIVIERES
QC
G8Y 5N9
2577
NATURALIZER
CARREFOUR DE I'ESTRIE
3050 BOUL. PORTLAND #202
SHERBROOKE
QC
J1L 1K1
2579
NATURALIZER
LES GALERIES DE HULL
320 BOUL. ST.JOSEPH
HULL
QC
J8Y 3Y8
2580
NATURALIZER
PLACE STE-FOY
2450 BOUL. LAUIER
STE-FOY
QC
G1V 2L1
2581
NATURALIZER
GALERIES CHAGNON
1200 BOUL. ALPHONSE DESJARDINS
LEVIS
QC
G6V 6Y8
2582
NATURALIZER
PLACE FLEUR DE LYS
550 BOUL. HAMEL
QUEBEC
QC
G1M 2S5
2583
NATURALIZER
GALERIES DE LA CAPITALE
5401 BOULEVARD DES GALERIES
QUEBEC
QC
G2K 1N4
2584
NATURALIZER
LES GALERIES DE LA CANARDIERE
2485 BOUL. STE-ANNE
QUEBEC
QC
G1J 1Y4
2585
NATURALIZER
CARREFOUR ST-GEORGES
8585 BOUL. LACROIX
ST.GEORGES
QC
G5Y 5L6
2586
NATURALIZER
GALERIES JOLIETTE
1075 BOUL. FIRESTONE
JOLIETTE
QC
J6E 6X6
2587
NATURALIZER
PROMENADES DRUMMONDVILLE
755 RENE-LEVESQUE BOUL.
DRUMMONDVILLE
QC
J2C 6Y7

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

  STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   PROVINCE   MAIL CODE
2588
NATURALIZER
CARREFOUR ANGRIGNON
7077 NEWMAN BLVD.
LASALLE
QC
H8N 1X1
2590
NATURALIZER
PLACE DU ROYAUME
1401 BOUL. TALBOT
CHICOUTIMI
QC
G7G 4C1
2594
NATURALIZER
RIVIERE-DU-LOUP
298 ARMAND THERIAULT
RIVIERE-DU-LOUP
QC
G5R 4C2
2595
NATURALIZER
CARREFOUR RIMOUSKI
419 BOUL. JESSOP
RIMOUSKI
QC
G5L 7Y5
2596
NATURALIZER
QUARTIERS DIX30
9315 BOUL LEDUC, CENTER UNIT
BROSSARD
QC
J4Y 0A5
2650
NATURALIZER
CHAMPLAIN PLACE SHOPPING CENTRE
477 PAUL STREET
MONCTON
NB
E1A 4X5
2660
NATURALIZER
MCALLISTER SHOPPING CENTER
519 WESTMORLAND ROAD, BOX 63
ST. JOHN
NB
E2J 3W9
2670
NATURALIZER
BATHURST MALL
1300 ST-PETER AVENUE #63
BATHURST
NB
E2A 3A6
2680
NATURALIZER
REGENT MALL
1381 REGENT STREET
FREDERICTON
NB
E3C 1A2
2760
NATURALIZER
HALIFAX SHOPPING CENTRE
7001 MUMFORD ROAD BOX 216
HALIFAX
NS
B3L 4N9
2766
NATURALIZER
MIC MAC MALL
21 MICMAC BLVD.
HALIFAX
NS
B3A 4N3
2767
NATURALIZER
SUNNYSIDE SHOPPING MALL
1595 BEDFORD HIGHWAY #152
BEDFORD
NS
B4A 3Y4
2768
NATURALIZER
COUNTY FAIR MALL
9256 COMMERCIAL ST #0285
NEW MINAS
NS
B4N 4A9
2770
NATURALIZER
HIGHLAND SQUARE
689 WESTVILLE ROAD #36
NEW GLASGOW
NS
B2H 2J6
2780
NATURALIZER
MAYFLOWER MALL
800 GRAND LAKE ROAD
SYDNEY
NS
B1P 6S9
2950
NATURALIZER
AVALON MALL
48 KENMOUNT ROAD #L 15
ST. JOHN'S
NL
A1B 1W3
2951
NATURALIZER
VILLAGE SHOPPING CENTRE
430 TOPSAIL ROAD BOX 1
ST. JOHNS
NL
A1E 4N1
2960
NATURALIZER
CORNER BROOK PLAZA
54 MAPLE VALLEY ROAD
CORNER BROOK
NL
A2H 6L8

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES -CANADIAN RETAIL STORES LEASED (as of January 1,  2009)

   STORE #   TRADE/STORE NAME   MALL/SHOPPING CENTER   ADDRESS    CITY   PROVINCE   MAIL CODE
5060
NATURALIZER OUTLET
BRENTWOOD TOWN CENTRE
4567 LOUGHEED HWY
BURNABY
BC
V5C 3Z6
5355
NATURALIZER OUTLET
GARDEN CITY SHOPPING CENTRE
2305 MCPHILLIPS STREET
WINNEPEG
MB
R2V 3E1
5450
NATURALIZER OUTLET
DIXIE OUTLET MALL
1250 SOUTH SERVICE ROAD
MISSISSAUGA
ON
L5E 1V4
5455
NATURALIZER OUTLET
WOODBINE CENTRE
500 REXDALE BLVD
ETOBICOKE
ON
M9W 6K5
5465
NATURALIZER OUTLET
COOKSTOWN MANUFACTURERS' OUTLET MALL
3311 SIMCOE ROAD
COOKSTOWN
ON
L0L 1L0
5491
NATURALIZER OUTLET
PERTH FACTORY OUTLET
1857 RODGERS POAD
PERTH
ON
K7H 3E8
5550
NATURALIZER OUTLET
MEGA CENTRE NOTRE DAME
2312 AUTOROUTE CHOMEDEY
LAVAL
QC
H7X 4G8
5597
NATURALIZER OUTLET
FACTORERIES ST-SAUVEUR
100 GUINDON C.P.
ST-SAUVEUR DES MONTS
QC
J0R 1R0
 
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - LEASED PROPERTIES OTHER THAN RETAIL STORE LOCATIONS
(as of January 1, 2009)

  Loan Party   Location    Use
Brown Group Retail, Inc. (Lessee)
Former Famous Footwear
7010 Mineral Point Road
Madison, WI  53717
 
Vacant office space
Brown Group Retail, Inc. (Lessee)
Sun Prairie Business Park
1615 Commerce Drive
Sun Prairie, WI  53590
 
Warehouse distribution
Brown Group Retail, Inc. (Lessee)
 
625 Maddox Simpson Parkway
Lebanon, TN  37090
 
Warehouse distribution
 
Brown Shoe Company, Inc. (Lessee)
 
 
693 Fifth Avenue
9th, 11th & 12th Floors
New York, NY  10022
 
Office Space
 
 
Brown Shoe Company, Inc. (Lessee)
 
1500 West Malone, US 60
Sikeston, MO  63801
 
Warehouse distribution
 
Bennett Footwear Group LLC (Lessee)
(to be assigned to Brown Group Retail, Inc..)
117 Kendrick Street
Needham, MA  02494
Vacant office space
 
Bennett Footwear Group LLC (Lessee)
(to be assigned to Brown Shoe Company, Inc.)
1370 Avenue of the Americas (portion of the Fifth Floor)
New York, NY  10019
Subleased office space
 

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - LEASED PROPERTIES OTHER THAN RETAIL STORE LOCATIONS (as of January 1, 2009)

   Loan Party   Location   Use
Bennett Footwear Group LLC (Lessee)
(to be assigned to Brown Shoe Company, Inc.)
156 West 56th Street, Suites (1400, 1401 and 1500)
New York, NY  10019
 
NY Office & Showroom space
Brown Shoe Company, Inc. (Lessee)
5621 Dennis McCarthy Drive
Lebec, CA  93243
 
Warehouse distribution (West Coast)
Brown Group Retail, Inc. (Lessee)
6755 Hollywood Blvd.
Los Angeles, CA  90028
 
Subleased Office Space
Sidney Rich Associates, Inc. (Lessee)
1004 Beau Terre Drive
Suite 512
Bentonville, AK  72712
 
Office space
Sidney Rich Associates, Inc. (Lessee)
4-5 Floors, No. 26
Wen Hsin Rd., Sec. 3
Taichung, Taiwan
 
Office space
Brown Shoe Company, Inc. (Lessee)
Spirit of St. Louis Airport
18190 Edison Avenue
Chesterfield, MO  63005
 
Airport hangar
Brown Group Retail, Inc. (Lessee)
2520 NW 97th Avenue, #100
Doral, FL  33172
 
Office space
Brown Group Retail, Inc. (Lessee)
151 Fries Mill Road, Ste. 505
Turnerville, NJ  08012
 
Real Estate Director (R. Grahamslaw) Office Space

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - LEASED PROPERTIES OTHER THAN RETAIL STORE LOCATIONS (as of January 1, 2009)

  Loan Party   Location    Use
Brown Group Retail, Inc. (Lessee)
1745 Shea Center Drive, 4th Floor
Highlands Ranch, CO  80129
 
Real Estate Director (D. Angard) Office Space
Brown Group Retail, Inc. (Lessee) 
HQ Global Workplaces
1200 U.S. Hwy E, Ste. 2000
Bridgewater, NJ  08807
 
Real Estate Director (S. Jennerich) Office Space
Brown Group Retail, Inc. (Lessee)
116 E. Madison Street
Lake Mills, WI  53551
 
Real Estate Director (H. Van Ommeren) Office Space
Brown Group Retail, Inc. (Lessee)
2300 N. Barrington Road, Ste. 453
Hoffman Estates, IL  60195
 
Real Estate Director (J. Pye) Office Space
Brown Shoe Company of Canada Ltd 
3090 Le Carrefour Blvd..
Suite 750
Laval, Quebec Canada  H2Z 1S8
Office space

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - OWNED PROPERTY
(as of January 1, 2009)

Owner
Location
Use
Brown Group Retail, Inc.
Building and Property located at and to the east of
5800 East Jewel Avenue
Denver, CO  80224
 
Leased to wholesaler of tile material -vacant land being maintained for environmental purposes
Brown Shoe Company, Inc.
Moench Tanning
465 Palmer Street
Gowanda, NY 14070
 
Vacant land being maintained for environmental purposes
Brown Shoe Company, Inc.
Moench Tanning
Town of Dayton
Cattaraugus, County, NY
 
Vacant land being maintained for environmental purposes
Brown Shoe Company, Inc.
8300-8350 Maryland Ave. & SE corner at Topton
St. Louis, MO  63105
 
Main Office, Conference Center & Adjacent Parking Lots
Brown Shoe Company, Inc.
8400 Maryland Avenue
St. Louis, MO 63105
Main Office, Parking Lots
 
Brown Shoe Company, Inc.
8500 Maryland Avenue
St. Louis, MO 63105
 
Vacant building & Parking lot- part of Main Office Complex

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES - OWNED PROPERTY (as of January 1, 2009)

  Owner   Location   Use
Brown Shoe Company, Inc.
1000 East Main Street
Fredericktown, MO  63645
 
Warehouse distribution
Brown Shoe Company, Inc.
103 S. Acres
Sikeston, MO  63801
Warehouse distribution
Brown Shoe Company of Canada Ltd
 
1857 Rogers Road
Perth, Ontario K7H 3EH
Warehouse distribution & Office
 
Brown Shoe Company of Canada Ltd
 
40 Sunset
Perth, Ontario K7H 2X3
Leased to shoe mfgr.
 
Brown Shoe Company of Canada Ltd
 
27 Elaine Crescent
Stirling, Ontario K0K 3E0
Vacant Factory
 

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.5(b) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
TITLE TO PROPERTIES; REAL ESTATE
BROWN COMPANIES (AS LESSOR/LICENSOR)- LEASED/LICENSED PROPERTIES

LESSOR/LICENSOR
LESSEE/LICENSEE
LOCATION
USE
Bennett Footwear Group LLC
(Sublessor) (to be assigned to Brown Shoe Company, Inc.)
 
New York Transit (Sublessee)
 
1370 Avenue of the Americas (portion of the Fifth Floor)
New York, NY  10019
Office space
 
Brown Group Retail, Inc.
 
Capco Tile (lessee)
 
5800 East Jewel Avenue
Denver, CO  80224
 
Building & property
 
Brown Group Retail, Inc. (Sublessor)
 
People Media, Inc.(sublessee)
 
6755 Hollywood Blvd.
Los Angeles, CA  90028
Office Space
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.6 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

DISCLOSED MATTERS

(As of January 7, 2009)


The Borrowers are involved in environmental remediation and ongoing compliance activities at several sites.  Brown Retail is remediating, under the oversight of Colorado authorities, the groundwater and indoor air at its owned facility in Colorado (also known as the Redfield site) and residential neighborhoods adjacent to and near the property that have been affected by solvents previously used at the facility.
 
In March 2000, a class action lawsuit was filed in Colorado State Court (District Court for the City and County of Denver) related to the Redfield site described above. Plaintiffs alleged claims for trespass, nuisance, strict liability, unjust enrichment, negligence and exemplary damages arising from the alleged release of solvents contaminating the groundwater and indoor air in the areas adjacent to and near the site. In December 2003, the jury hearing the claims returned a verdict finding Brown Retail negligent and awarded the class plaintiffs $1.0 million in damages. This award was recorded along with estimated pretrial interest on the award and estimated costs related to sanctions imposed by the court related to a pretrial discovery dispute between the parties. The total pretax charge recorded for these matters in 2003 was $3.1 million. An additional $0.6 million in expense was recorded in 2004, related to pretrial interest, to reflect the trial court’s ruling extending the time period for which prejudgment interest applied. The plaintiffs filed an appeal of the December 2003 jury verdict, and in August 2007, the Colorado Court of Appeals rejected the plaintiffs’ attempt to obtain a new trial by affirming the trial court judgment. The Court also denied a cross-appeal by Brown Retail seeking a reversal of a portion of the pretrial interest awarded to plaintiffs, and an additional $0.8 million was paid in April 2008 for the remainder of the pretrial interest owing on the judgment. The Court also reversed the trial court’s award of costs and remanded the case to the trial court for a determination of whether plaintiffs are entitled to recover their costs related to the trial. The plaintiffs subsequently filed a petition with the Supreme Court of Colorado seeking review of the Court of Appeal’s decision denying them a new trial, which the Supreme Court denied on May 19, 2008, effectively ending plaintiffs’ attempts to obtain a retrial. The cost of further proceedings in this matter may vary.
 
In connection with the Redfield environmental remediation and class action litigation discussed above, Brown Retail sued a number of its insurers seeking recovery of defense costs, indemnity and other damages related to the former operations and the remediation at the site. During 2006, Brown Retail reached agreements with certain of those insurers to resolve the coverage claims arising out of the Redfield site and recorded income related to these recoveries of $7.3 million, net of related legal fees, as a reduction of selling and administrative expenses. Prior to a trial of that action, during the first quarter of 2008, Brown Retail reached settlements with all insurers remaining in the case for total insurance recoveries, net of associated fees and costs, of $10.2 million, as a reduction of selling and administrative expenses. As a result of these settlements, all claims among the parties have been dismissed. In addition, Brown Retail filed a contribution action in Colorado State Court against the Colorado Department of Transportation (CDOT), which owns and operates a facility adjacent to the Redfield site. On April 14, 2008, the Supreme Court of Colorado reversed the trial court’s and Court of Appeal’s rulings, which had rejected CDOT’s attempts to have Brown Retail’s cost recovery suit dismissed on legal grounds. As a result, only one claim related to a small ancillary part of the remediation efforts was allowed to go forward, and Brown Retail has since reached an agreement to settle for a minimal payment by CDOT, and the case has been dismissed.
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.10 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

ERISA
 

ERISA Pension Benefit Plans
 
Brown Shoe Company, Inc. Retirement Plan
 
Foreign Pension Benefit Plans
 
The Pension Plan for the Salaried Staff and Salespersons of Brown Shoe Company of Canada Ltd.  (Currently in the process of conducting a “partial wind-up” of this plan.)
 
The Pension Plan for the Designated Employees of Brown Shoe Company of Canada Ltd.  (Currently in the process of conducting a “partial wind-up” of this plan.)
 
The Pension Plan for the Store Managers and Office Employees of Brown Shoe Company of Canada Ltd - Retail Division.
 

 

 
 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.13 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

SUBSIDIARIES; CAPITALIZATION



Name
Authorized Shares of Capital Stock
Issued and Outstanding Shares of Capital Stock
Brown Shoe Company, Inc.
Common: 100,000,000
Preferred:     1,000,000
42,327,519
Bennett Footwear Group LLC
Membership Interest
Membership Interest
Brown California, Inc.
100
100
Brown Group Retail, Inc.
10,000
10,000
Brown Missouri, Inc.
2,000
2,000
Brown Retail Development Company, Inc.
2,000
1,000
Brown Shoe International Corp.
10,000
2,000
Brown Shoe Investment Company, Inc.
2,000
2,000
Brown Shoe Services Corporation
10,000
2,000
Brown Texas, Inc.
100
100
Buster Brown & Co.
2,000
2,000
Maryland Square, Inc.
1000
1000
Maserati Footwear, Inc.
1,000
1,000
Pagoda Trading North America, Inc.
2,000
2,000
Shoes.com, Inc.
Common: 4,000,000
Preferred: 3,000,000
Common: 114,024
Preferred: 1,224,726 Class A-1
Sidney Rich Associates, Inc
2,000
2,000
Brown Cayman Ltd.
101,000
101,000
Brown Group Dublin Limited
150,000
150,000
Brown Shoe Asia Investment Limited
1,000
1,000
Brown Shoe Company of Canada Ltd
Class A(5%):31,500
Class B: 89,166
Class A(5%): 31,500
Class B: 50,441
Brown Shoe International (Macau) Company Limited
MOP 100,000
MOP 100,000
Brown Shoe International Sales and Licensing Limited
1,000
1,000
Brown Shoe International Sales and Licensing S.r.l.
100% of total authorized capital
100% of total authorized capital
Brown Shoe Service Company Limited
HK$7,000
1,000
DongGuan Brown Shoe Company Limited
100% of total authorized capital
100% of total authorized capital
DongGuan Leeway Footwear Company Limited
100% of total authorized capital
100% of total authorized capital

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.13 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

SUBSIDIARIES (Continued)

  Name   Authorized Shares of Capital Stock   Issued and Outstanding Shares of Capital Stock
Great Prosper Profits Corporation
US$50,000
$1
Laysan Company Limited
144,000,000
143,706,197
Leeway International Company Limited
30,000
30,000
Pagoda International Corporation do Brasil, LTDA
100% of Total “Quotas” Owned
100% of Total “Quotas” Owned
Pagoda International Footwear Limited
1,500,000
1,492,879
Pagoda International Footwear (Macao Commercial Offshore) Ltd.
MOP 78,000
MOP78,000
Pagoda Leather Limited
15,309,023
15,309,023
Putian Brown Shoe Company Limited
100% of total authorized capital
100% of total authorized capital
Whitenox Limited
7,300,000
7,206,168

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.14 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

INSURANCE


 (SEE ATTACHED DESCRIPTION OF INSURANCE)

 
 
 
 
 
Brown Shoe Company, Inc.
Policy Digest
       
  Marsh
 701 Market Street
 Sutie 1000
St. Louis, MO 63101
               
   As of 12/10/08            
Line of Coverage/Description   Carrier   Policy  Period   Policy Number   Limit   Deductible/SIR   Policy Delivered
               
Property            
   All Risk  Lexington Insurance Company  06/15/08 - 06/15/09 *  $500,000,000  *  9/2/2008
   All Risk - Canada  Lexington Insurance Company  06/15/08  - 06/15/09  *  $500,000,000  *  11/13/2008
   Excess Flood  Endurance Specialty Insurance  06/15/08 - 06/15/09  *  $20M xs $50M    9/18/2008
  National Flood Insurance Program   American Bankers  Various  *      
               
CASUALTY            
   General Liability  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  $1 million / $3 million / $10 million / $1 million  * 5/2/2008
   Employee Benefits Liability (incld in GL)  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  $1 M each claim/$2 M aggregate Retro 1/31/05    5/2/2008
  General Liability - Canada  Travelers Indemnity Co. (Canada)  01/31/08 - 01/31/09  *  $1 million / $3 million / $10 million / $1 million  *  7/9/2008
   Employee Benefits Liability (incld in GL)  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  $1 M each claim/$2 M aggregate Retro 1/31/05    7/9/2008
  Auto Liability  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  $1 million CSL  *  5/2/2008
   Auto Liability - Canada  Travelers Indemnity Co. (Canada)  01/31/08 - 01/31/09  *      7/9/2008
   Workers' Compensation  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  WC - Satutory/EL - $1 million/$1 million/$1 million  *  5/2/2008
   Workers' Compensation - (AZ, MA, OR, WI)  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  WC - Satutory/EL - $1 million/$1 million/$1 million  *  5/2/2008
   Workers' Compensation - (WV)  Travelers Property & Casualty Company  01/31/08 - 01/31/09  *  WC - Satutory/EL - $1 million/$1 million/$1 million  *  9/16/2008
   Workers' Compensation - Guam  Travelers Indemnity Co  01/31/08 - 01/31/09  *      6/4/2008
   Umbrella Liability - *  Federal Insurance Company  01/31/08 - 01/31/09  *  $25 million    5/2/2008
   *  *  *  *  *    *
   *  *  *  *  *    *
  *  *  *  *  *    *
  *  *  *  *  *    *
               
AIRCRAFT            
   *  *  *  *  *    *
FOREIGN            
   General Liability
 Ace American Insurance Co.
 06/15/07 - 1/31/09  *  $1M/occurrence   24-Jul-07
   Employee Benefits Liability  Ace American Insurance Co.   06/15/07 - 1/31/09 *  $1M/each claim/$1M aggregate - Retro 1/31/07  *  incl.
   Foreign Auto Liability (Contingent)  Ace American Insurance Co.   06/15/07 - 1/31/09  *  $1 M CSL    incl.
   Foreign Employers Liability  Ace American Insurance Co.   06/15/07 - 1/31/09  *  $1 million/$1 million/$1 million    incl.
               
MARINE            
   Marine/War Risks Open Cargo  American Home Assurance Co.  07/1/08-09  *  $9M/occurrence    7/8/2008
               
Surety            
   Surety  Safeco  Various  *    *  

 
 
 
 
 
ACORD TM      CERTIFICATE OF LIABILITY INSURANCE
 DATE (MM/DD/YYYY)
11/07/2008
PRODUCER    THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY
      Aon Risk Services Central, Inc.    AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS
      St. Louis MO Office    CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE
      8182 Maryland Avenue   COVERAGE AFFORDED BY THE POLICES BELOW.
      St. Louis MO 63105 USA        
         
 PHONE - (866) 283-7122  FAX - (847) 953-5390   INSURERS AFFORDING COVERAGE  NAIC #
 INSURED   INSURER A:   Federal Insurance Company  20281
     Brown Shoe Company, Inc.   INSURER B:   Steadfast Insurance Company  26387
     8300 Maryland Avenue   INSURER C:  
     Clayton MO 63105 USA   INSURER D:  
    INSURER E:  
COVERAGES SIR applies per term and conditions of the policy
THE POLICIES OF INSURANCE LISTED HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY BEEN BEEN REDUCED BY PAID CLAIMS.
LIMITS SHOWN ARE AS REQUESTED
 INSR
LTR
 ADD'L
INSRD
 TYPE OF INSURANCE
 POLICY NUMBER
 POLICY EFFECTIVE
DATE(MM/DD/YYYY)
POLICY EXPIRATION
DATE(MM/DD/YYYY)
LIMITS
     GENERAL LIABILITY        EACH OCCURRENCE  
      o COMMERCIAL GENERAL LIABITY        DAMAGE TO RENTED PREMISES (Ea occurrence)  
      o CLAIMS MADE     o OCCUR        MED EXP (Anyone person)  
      o                        PERSONAL & ADV INJURY  
    o                        GENERAL AGGREGATE  
     GEN'L AGGREAGATE LIMIT APPLIES PER:        PRODUCTS-COMP/OP AGG  
      o POLICY       o PROJECT      o LOC          
     AUTOMOBILE LIABILITY      
 COMBINED SINGEL LIMIT
(Ea accident)
 
      o ANY AUTO       BODILY INJURY (Per person)  
      o ALL OWNED AUTOS        BODILY INJURY (Per accident)  
      o SCHEDULED AUTOS      
 PROPERTY DAMAGE
(Per accident)
 
      o HIRED AUTOS          
      o NON OWNED AUTOS          
      o                                                                                        
     GARAGE LIABILITY        AUTO ONLY - EA ACCIDENT  
      o ANY AUTO        OTHER THAN      EA ACC  
      o        AUTO ONLY:          AGG  
     EXCESS / UMBRELLA LIABILITY        EACH OCCURANCE  
      o OCCUR          o CLAIMS MADE        AGGREGATE  
      o DEDUCTIBLE          
      o RETENTION          
     WORKERS COMPENSATION AND EMPLOYERS' LIABILITY        ___ WC STATUTORY LIMITS  
             ___ OTHER  
     ANY PROPRIETORY/PARTNER/EXECUTIVE/OFFICER/MEMBER EXCLUDED?        E.L. EACH ACCIDENT  
             E.L. DISEASE-POLICY LIMIT  
     If yes, describe under SPECIAL PROVSIONS below          
 B  
 OTHER
*
 *
 *
 10/31/08  10/31/09  Limit per Occurrence  *
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/EXCLUSIONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS
 
 
 
 
  CERTIFICATE HOLDER   CANCELLATION
 
 Bank of America, N.A. , ASTIMAS,ISAOA
Attn: Craig Barcelo
100 Federal Street, 9th Floor
Boston MA 0-02110 USA
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING INSURER WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO DO SO SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER, ITS AGENTS OR RESPRESENTATIVES.
 
AUTHORIZED REPRESEANTIVE    /S/ Aon Risk Services Central, Inc.
ACORD 25 (2001/08) ACORD CORPORATION 1988
 
 
 
 
 
 
Attachment to ACORD Certificate for Brown Shoe Company, Inc.
The terms, conditions and provisions noted below are hereby attached to the captioned certificate as additional description of the coverage afforded by the insurer(s). This attachment does not contain all terms, conditions, coverages or exclusions contained in the policy.
 
INSURED INSURER 
   Brown Shoe Company, Inc. INSURER 
   8300 Maryland Avenue INSURER 
   Clayton MO 63105 USA INSURER 
    INSURER 
ADDTIONAL POLICIES  If a policy below does not include limit information, refer to the corresponding policy on the ACORD certificate form for policy limits.
 
INSR
LTR
 ADD'L
INSRD
 TYPE OF INSURANCE
 POLICY NUMBER
 POLICY EFFECTIVE
DATE
POLICY EXPIRATION
DATE
LIMITS
     OTHER          
 A   Fiduciary Liab 
 *
D&O/Fiduciary/Crime
 10/31/08 10/31/09   Fiduciary Liability  *
 A    D&O Coverage
 *
D&O/Fiduciary/Crime
 10/31/08  10/31/09  D&O limit each loss  *
 A   *
 *
 *
 10/31/07  10/31/10  *  *
               
               
               
DESCRIPTION OF OPERATIONAL/LOCATIONS/VEHICLES/EXCLUSONS ADDED BY ENDORSEMENT/SPECIAL PROVISIONS
 
 
 
 
INSURED
 
Brown Shoe Company, Inc.
8300 Maryland Avenue
Clayton MO 63105 USA
 
Coverage
 
Type of Coverage
Primary D&O
Carrier - Chubb
Policy Number - *
Limit of Liability - *
 
Excess D&O - Layer 1
Carrier - AIG
Policy Number - *
Limit of Liability - *
 
*
 
Primary Fiduciary
Carrier - Chubb
Policy Number - *
Limit of Liability - *
 
*
 
 
 
 

 
 MARSH  CERTIFICATE OF INSURANCE  
CERTIFICATE NUMBER
CHI-002165362-21
PRODUCER    THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS
      Marsh USA Inc.    NO RIGHTS UPON THE CERTIFICATE HOLDER OTHER THAN THOSE PROVIDED IN THE
      701 Market Street    POLICY. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE
      Suite 1100   AFFORDED BY THE POLICES DESCRIBED HEREIN.
      St. Louis, MO 63101        
         
 99999 -NFIP-08-09  yes COMPANIES AFFORDING COVERAGE
 INSURED   COMPANY A:  The Standard Fire Insurance Company
     Brown Shoe Company, Inc.   COMPANY B    American Bankers Insurance Company of Florida
     8300 Maryland Avenue   COMPANY C
     St. Louis, MO 63105   COMPANY D
COVERAGE This certificate supercedes and replaces any previously issued certificate for the period noted below
THIS IS TO CERIFY THAT POLICIES OF INSURANCE DESCRIBED HEREIN HAVE BEEN ISSUED TO THE INSURED NAMED HEREIN FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THE CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, CONDITIONS AND EXCLUSIONS OF SUCH POLICIES. AGGREGATE LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
 CO LTR
 TYPE OF INSURANCE
 POLICY NUMBER
 POLICY EFFECTIVE
DATE(MM/DD/YYYY)
POLICY EXPIRATION
DATE(MM/DD/YYYY)
LIMITS
   GENERAL LIABILITY        GENERAL AGGREAGATE  $
    o COMMERCIAL GENERAL LIABITY        PRODUCTS - COMP/OP AGG  $
    o CLAIMS MADE     o OCCUR        PERSONAL & ADV INJURY  $
    o OWNER'S & CONTRACTOR'S PROT        EACH OCCURENCE  $
  o                        FIRE DAMAGE(Any one fire)  $
           MED EXP(Any one person)  $
             
   AUTOMOBILE LIABILITY      
 COMBINED SINGLE LIMIT
 $
    o ANY AUTO       BODILY INJURY (Per person)  $
    o ALL OWNED AUTOS        BODILY INJURY (Per accident)  $
    o SCHEDULED AUTOS      
 PROPERTY DAMAGE
 $
    o HIRED AUTOS          
    o NON OWNED AUTOS          
    o                                                                                        
   GARAGE LIABILITY        AUTO ONLY - EA ACCIDENT  $
    o ANY AUTO        OTHER THAN AUTO ONLY:  
    o        EACH ACCIDENT  $
          AGGREGATE   $
   EXCESS LIABILITY        EACH OCCURANCE  $
    o UMBRELLA FORM        AGGREGATE  $
    o OTHER THAN UMBRELLA FORM          
             
   WORKERS COMPENSATION AND EMPLOYERS' LIABILITY        ___ WC STATUTORY LIMITS  
           ___ OTHER  
   THE PROPRIETOR/PARTNERS/EXECTUIVE OFFICERS ARE: o INCL     o EXCL        EL EACH ACCIDENT  $
           EL DISEASE-POLICY LIMIT  $
           EL DISEASE-EACH EMPLOYEE  $
 
 OTHER
 
       
A  NFIP  *  03/17/08  03/17/09  Limit  500,000
 B  NFIP  *  07/23/08  07/23/09  Limit  500,000
 C  NFIP  *  10/01/08  10/01/09  Limit  500,000
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/EXCLUSIONS/SPECIAL ITEMS
 
Bank of America is included as Mortgagee / Loss Pyee on the referenced Floods policies where required by written contract:
Policy No. * - 103 S. Acres St., Sikeston, MO 63801-5607 - Deductible: $*
Policy No. * - 1000 E. Main St., Fredericktown, MO 63645-1237 - Deductible: $*
Policy No. * - Hwy. Z 1 Miles E of Fredericktown, MO 63645 - Deductible: $*
  CERTIFICATE HOLDER   CANCELLATION
 
 Bank of America, NA
MA5-100-09-09
100 Federal Street, 9th Floor
Boston, MA 02110
SHOULD ANY OF THE POLICIES DESCRIBED HEREIN BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE INSURER AFFORDING COVERAGE WILL ENDEAVOR TO MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED HEREIN, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER AFFORDING COVERAGE, ITS AGENTS OR REPRESENTITIVES, OR THE INSURER OF THIS CERTIFICATE.
 
AUTHORIZED REPRESENTATIVE
of Marsh USA, Inc.
 BY:   Alfred A. Peterfeso     /s/ Alfred A. Peterfeso
  MM1(3/02)                                                                    VALID AS OF: 01/13/09
 
 
 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.15 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

LABOR MATTERS

(As of December 16, 2008)

1.  
The Lead Borrower is a party to a collective bargaining agreement with the United Food and Commercial Workers Union, Local No. 655, as chartered by the United Food and Commercial Workers International Union with respect to employees at its Fredericktown, Missouri warehouse. This contract expires on June 15, 2010.
 
2.  
Brown Shoe Company of Canada Ltd is a party to a collective bargaining agreement with the United Food and Commercial Workers Union, Local No. 175, with respect to employees at its Perth, Ontario warehouse. This contract is binding on the parties until October 24, 2010, at which time it will renew for successive one-year periods unless either party gives 30-90 days notice of termination or amendment of the contract.
 

 

 
 
 

BROWN SHOE COMPANY, INC.
 
SCHEDULE 3.16 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
AFFILIATE TRANSACTIONS
 
1.  
Brown Shoe Company, Inc. is subject to a secondment agreement (as such agreement may be amended from time to time) between Brown Shoe Company, Inc. and DongGuan B&H Footwear Company Limited, pursuant to which Brown Shoe Company, Inc. provides (“seconds”) the services of Howard Herman, Vice President - Brown Shoe Company, Inc., to a foreign affiliate, and Mr. Herman is deemed to be an employee of the foreign affiliate.
 
2.
Richard M. Ausick – Senior Vice President - Brown Shoe Company, Inc., serves as a director of Edelman Shoe, Inc., and is also party to an Indemnification Agreement, dated August 15, 2007, pursuant to which he is entitled to indemnification from Edelman Shoe, Inc. to the fullest extent permitted by law.
 
3.
Thomas H. Lucas, Senior Vice President – Finance, serves as a director of Edelman Shoe, Inc., and is also party to an Indemnification Agreement, dated August 15, 2007, pursuant to which he is entitled to indemnification from Edelman Shoe, Inc. to the fullest extent permitted by law.
 
4.
Certain officers of Brown Shoe Company, Inc. also serve as directors of Subsidiaries directly or indirectly 100% owned by Brown Shoe Company, Inc., including Subsidiaries that are not Loan Parties.
 
5.
Charles Gillman, Douglas Koch, Timothy Heard and Mark Hood, all officers of Brown Shoe Company, Inc., serve as directors of B&H Footwear Company Limited, a 51% controlled Subsidiary.
 
6.
Brown Shoe Investment Company, Inc. is party to the Amended and Restated Stockholders Agreement (as such Agreement may be amended from time to time), dated 11/3/08 with respect to Edelman Shoe, Inc.
 
7.
Brown Shoe Company, Inc. licenses the Naturalizer trademark to DongGuan B&H Footwear Company Limited for the sourcing and sale of Naturalizer branded footwear in China.
 
8.
Brown Shoe Company, Inc. is a party to an Agreement (as such Agreement may be amended from time to time) regarding inventory among Brown Shoe Company, Inc., B&H Footwear Company Limited, Hongguo International Holdings Limited and Mayflower (Nanjing) Enterprise Company Limited, pursuant to which Hongguo and Mayflower will re-brand and/or resell certain excess inventory of Naturalizer products in China.  
 
9.
Sam and Libby Edelman and Edelman Shoe, Inc. are party to agreements (as such agreements may be amended from time to time) with the Loan Parties.
 
10.
From time to time, the Lead Borrower and its Affiliates may utilize the services of OgilvyOne LLC or its Affiliates.  One of the Lead Borrower's directors, Carla Hendra, is an executive officer of Affiliates of OgilvyOne LLC.
 
11.
From time to time, the Lead Borrower and its Affiliates may utilize the services of Heidrick & Struggles, an executive search firm.  One of the Lead Borrower's directors, Harold B. Wright, is a partner emeritus of Heidrick & Struggles.
 

 

 
 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.21 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

INTELLECTUAL PROPERTY

 
None
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
 
 
Credi Card Arrangements
 
The following Credit Card Arrangements are not subject to a Credit Card Notification Agreement under the Existing Credit Agreement.
 
 
DIVISION
 
CREDIT CARD ACCEPTED
 
PROCEEDS CREDITED -BANK
 
PROCEEDS CREDITED - ACCOUNT
 
CURRENCY
FAMOUS FOOTWEAR - STORES / INTERNET
AMERICAN EXPRESS
BANK OF AMERICA
*
USD
 
DISCOVER
BANK OF AMERICA
*
USD
 
JCB
BANK OF AMERICA
*
USD
 
MASTERCARD
BANK OF AMERICA
*
USD
 
VISA
BANK OF AMERICA
*
USD
         
         
FAMOUS FOOTWEAR - B-TO-B
AMERICAN EXPRESS
BANK OF AMERICA
*
USD
 
DISCOVER
BANK OF AMERICA
*
USD
 
JCB
BANK OF AMERICA
*
USD
 
MASTERCARD
BANK OF AMERICA
*
USD
 
VISA
BANK OF AMERICA
*
USD
         
         
NATURALIZER - STORES / CATALOG / INTERNET
AMERICAN EXPRESS
BANK OF AMERICA
*
USD
 
DISCOVER
BANK OF AMERICA
*
USD
 
MASTERCARD
BANK OF AMERICA
*
USD

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

 
DIVISION
 
CREDIT CARD ACCEPTED
 
PROCEEDS CREDITED -BANK
 
PROCEEDS CREDITED - ACCOUNT
 
CURRENCY
 
VISA
BANK OF AMERICA
*
USD
         
         
NATURALIZER - CANADA STORES
AMERICAN EXPRESS
BANK OF AMERICA CAD
*
CAD
 
MASTERCARD
BANK OF AMERICA CAD
*
CAD
 
VISA
BANK OF AMERICA CAD
*
CAD
         
         
BROWN WHOLESALE - B-TO-B
MASTERCARD
BANK OF AMERICA
*
USD
 
VISA
BANK OF AMERICA
*
USD
         
         
SHOES.COM INTERNET
AMERICAN EXPRESS
BANK OF AMERICA
*
USD
 
DISCOVER
BANK OF AMERICA
*
USD
 
JCB
BANK OF AMERICA
*
USD
 
MASTERCARD
BANK OF AMERICA
*
USD
 
VISA
BANK OF AMERICA
*
USD
 
BILL ME LATER
BANK OF AMERICA
*
USD
 
PAYPAL
BANK OF AMERICA
*
USD
 

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

Blocked Account Agreements
 
BANK
BANK ACCOUNT NAME
BANK ACCOUNT NUMBER
CURRENCY
COMMENTS
SunTrust Bank
St. Louis Wholesale (Receipts)
*
USD
Funds to BOA Account *
Blocked account agreement in place.

 
Disbursement Accounts
 
BANK
BANK ACCOUNT NAME
BANK ACCOUNT NUMBER
CURRENCY
COMMENTS
Bank of America
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (Intermediary ZBA Funding)
   
Outgoing funds only.
         
 
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (A/P Disbursements)
     
         
 
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (Payroll)
     
         
 
Brown Shoe Company, Inc.
*
USD
Funded by BOA Account * .
 
  (CA Payroll)
     
         

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

  BANK   BANK ACCOUNT NAME   BANK ACCOUNT NUMBER   CURRENCY   COMMENTS
 
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (Corporate Disbursements)
     
         
 
Brown Shoe Company, Inc.
*
USD
Funded by BOA Account * .
 
  (Garnishment Payments)
     
         
 
Brown Shoe Services, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (Electronic Payment Funding)
     
         
 
Brown Group, Inc. Master Trust
*
USD
Funded By SunTrust Bank.
 
  (Disbursements)
*
   
         
 
Brown Group Retail, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  Famous Footwear
     
 
  (Electronic Payment Funding)
     
         
 
Brown Group Retail, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  Famous Footwear
     
 
  (A/P Disbursements)
     
         
 
Brown Group Retail, Inc.
*
USD
ZBA Funded By BOA Account * .

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

   BANK   BANK ACCOUNT NAME   BANK ACCOUNT NUMBER   CURRENCY   COMMENTS
 
  Naturalizer Retail
     
 
  (Electronic Payment Funding)
     
         
 
Brown Group Retail, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  Naturalizer Retail
     
 
  (A/P Disbursements)
     
         
 
Shoes.com, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (Electronic Payment Funding)
     
         
 
Shoes.com, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  (A/P Disbursements)
     
         
 
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  St. Louis Wholesale
     
 
  (Electronic Payment Funding)
     
         
 
Brown Shoe Company, Inc.
*
USD
ZBA Funded By BOA Account * .
 
  St. Louis Wholesale
     
 
  (A/P Disbursements)
     
         

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

  BANK BANK ACCOUNT NAME  BANK ACCOUNT NUMBER   CURRENCY COMMENTS
 
Brown Shoe Company of Canada, Ltd.
*
USD
Funded by FX purchases through * and * .
 
  (Electronic Payment Funding)
     
         
 
Brown Shoe Company of Canada, Ltd.
*
USD
Funded by FX purchases through * and * .
 
  (A/P Disbursements)
     
         
Bank of America Canada
Brown Shoe Company of Canada, Ltd. Retail
*
CAD
ZBA funded By BOA Account * .
 
  (Electronic Payment Funding)
     
         
 
Brown Shoe Company of Canada, Ltd. Wholesale
*
CAD
ZBA funded By BOA Account * .
 
  (Electronic Payment Funding)
     
         
 
Brown Shoe Company of Canada, Ltd. Retail
*
CAD
ZBA funded By BOA Account * .
 
  (A/P Disbursements)
     
         

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 3.22 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

CREDIT CARD ARRANGEMENTS, BLOCKED ACCOUNT AGREEMENTS AND DISBURSEMENT ACCOUNTS
(Continued)

BANK BANK ACCOUNT NAME    BANK ACCOUNT NUMBER    CURRENCY COMMENTS
 
Brown Shoe Company of Canada, Ltd. Wholesale
*
CAD
ZBA funded By BOA Account * .
 
  (A/P Disbursements)
     
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 4.1 (c) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
FOREIGN QUALIFICATION TERMINATIONS


 NAME
 
STATE OF QUALIFICATION TERMINATION
BROWN SHOE COMPANY, INC.
Maine
Massachusetts
Mississippi
New Hampshire
BENNETT FOOTWEAR GROUP LLC
California
Massachusetts
New Hampshire
New Jersey
Texas


 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 5.1 (h) TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

FINANCIAL REPORTING REQUIREMENTS

 
Monthly within seventeen (17) days (or such longer period as the Administrative Agent may agree in its reasonable discretion, but in any event not to exceed twenty-five (25) days) of the end of each fiscal month the following items are required to be reported:
 
1.  
A/R Aging by Division
 
2.  
A/R Reserves Report
 
3.  
A/R Rollforward
 
4.  
Top 10 Customer Aging
 
5.  
Inventory Reconciliation by Division
 
6.  
Inventory Report
 
7.  
L/C Reports/Intransit Inventory
 
8.  
Store Activity and Store List
 
 

 
 
 
BROWN SHOE COMPANY, INC.
 
SCHEDULE 6.1 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
 
INDEBTEDNESS
 
(As of January 8, 2009)
 
1.  
The Lead Borrower is contingently liable for lease commitments of approximately $1.7 million in the aggregate, which primarily relate to the Cloth World and Meis specialty retailing chains, which were sold in prior years.  In order for the Company to incur any liability related to these guarantees and lease commitments, the current owners would have to default.  At this time, the Company does not believe this is reasonably likely to occur.
 
2.
Loans and Notes pursuant to an Amended and Restated Loan Agreement, dated as of April 20, 2005, between Brown Group Dublin Limited and Brown Shoe Company of Canada Ltd, each dated April 20, 2005, made by Brown Group Dublin Limited to Brown Shoe Company of Canada Ltd.  All interest payable on and in connection with the Notes may be rolled into the principal of the Notes, and all bank fees payable on and in connection with the Notes will be rolled into the principal of the Notes. The maximum amount of the loans  under such Loan Agreement may not exceed $30,000,000.
 
3.
Loans pursuant to a Loan Agreement, dated July 12, 2001, between Brown Group Dublin Limited and Brown Shoe Company, Inc., and a promissory note relating thereto in the principal amount of $40,000,000.  All interest payable on and in connection with the promissory note may be rolled into the principal of the promissory note, and all fees payable on and in connection with the promissory note will be rolled into the principal of the promissory note.
 

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

LIENS


1.  
Statutory liens in respect of employer contributions accrued to the date of wind up of Canadian pension funds.
 
2.  
The following PPSA filings of record in Canada against Brown Shoe Company of Canada Ltd/Chaussures Brown du Canada Ltee (as of January, 2009):
 
Secured Party
Registration Number
Collateral Classification
 
British Columbia
 
Associates Leasing (Canada) Ltd.
8625198
Motor vehicles leased by the debtor
 
Manitoba
 
GE Vehicle and Equipment Leasing
200504049204
Motor vehicle leased by debtor
 
Ontario
 
GE Capital Vehicle and Equipment Leasing Inc.
20031015144615301855 (Reference File No. 600235272)
Inventory, Equipment, Accounts, Other and Motor Vehicle Included
National Leasing Group Inc.
20050513104960054369
(Reference File No. 615093102)
Equipment
Nissan Canada Inc.
20061017144915307961
(Reference File No. 629817759)
Consumer Goods, Equipment and Motor Vehicle Included
GE Vehicle and Equipment Leasing
19990409103615298596
(Reference File No. 849899484)
Inventory, Equipment, Accounts, Other and Motor Vehicle Included

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT


 
3.  
The following rights are registered at the Register of Personal and Moveable Real Rights (Québec) against Brown Shoe Company of Canada Ltd / Chaussures Brown du Canada Ltée (as of January 8, 2009) :
 
Secured Party
Registration Number
Type of Asset
 
Québec
 
Services Financiers Image Inc.
03-0542466-0006
Leased equipment
IBM Canada Limitée
00-0171060-0004
Leased equipment
GE Vehicle & Equipment Leasing
05-0240017-0018
Leased 2005 Mazda 6
G.E. Vehicle & Equipment Leasing
04-0382079-0014
Leased 2004 Honda Accord
G.E. Vehicle & Equipment Leasing
04-0307444-0019
Leased 2005 Nissan Altima
Associates Leasing (Canada) Ltd.
99-0191184-0029
Vehicle Lease
IBM Canada Limitée
99-0023312-0019
Lease of computer equipment
$4,668 per mo. and $3,901 per mo.
National Leasing Group Inc.
07-0446535-0001
Lease of water cooler
Bank of America, N.A.
04-0430109-0002
Universality hypothec: $800,000,000
Bank of America, N.A.
c/o Fleet Retail Group Inc.
01-0477922-0001
Universality hypothec: $800,000,000
Nissan Canada Inc.
07-0105646-0005
Leased 2006 Nissan Murano

 
4.  
Liens disclosed by UCC, tax and judgment lien searches as set forth on Annex A to Schedule 6.2 attached hereto.
 
5.  
Liens in favor of Lessors under leases with Brown Canada as set forth on Annex B to Schedule 6.2 attached hereto.
 

 
 
 

BROWN SHOE COMPANY, INC.
ANNEX A TO SCHEDULE 6.2
UCC FINANCING STATEMENTS OF RECORD AGAINST THE LOAN PARTIES

Secured Party
File No.
Original Filing Date
Collateral
DEBTOR NAME: BROWN SHOE COMPANY, INC.
Jurisdiction Searched: New York Department of State
Ameritech Credit Corporation
181543
9/24/2001
A lease of Canon CLC 900 Color Copiers and  all computers and other data transmission devices pursuant to a certain true lease agreement
General Electric Capital Corporation
200602170161154
2/17/2006
A true lease of 1 1999 Lear Jet
AVN Air, LLC
200804015343237
4/01/2008
A true lease of 1 Bombardier Learjet
Jurisdiction Searched: Missouri Secretary of State
General Electric Capital Corporation
4150626
4/4/2001
A true lease of 1 1999 Lear Jet
IKON Office Solutions- Canon Division
2863694
12/19/97
A lease of specific copy equipment.
Dell Financial Services, L.P.
3071558
9/2/99
All computer equipment and peripherals pursuant to a certain Master Lease Agreement between the Debtor and Secured Party
Jurisdiction Searched: Madison County, MO
The Industrial Development Authority of the City of Fredericktown, MO
07312
10/24/79
Collateral description is “As defined in the Lease dated October 1, 1979, between Debtor and Secured Party”
Jurisdiction Searched: St. Louis Independent City, MO
 

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)


Dell Financial Services, L.P.
05740
9/3/99
All computer equipment and peripherals pursuant to a certain Master Lease Agreement between the Debtor and Secured Party
DEBTOR NAME: BROWN GROUP, INC. (FORMER NAME OF BROWN SHOE COMPANY, INC.)
Jurisdiction Searched: Missouri Secretary of State
The Industrial Development Authority of the City of Fredericktown, MO
1845034
3/16/90
Collateral description is “As defined in the Lease dated October 1, 1979, between Debtor and Secured Party”
Forsythe / MacArthur Associates, Inc.
2023466
7/18/91
A specific lease agreement of computer, data processing , telecommunications and other equipment
Storage Technology Corporation
2139395
6/10/92
Specific data processing equipment
Mirex Corporation
2686250
7/15/96
A lease of specific equipment
Ameritech Credit Corporation
2743073
1/6/97
A true lease of computers and other data transmission devices
NationsBanc Leasing
2784544
5/1/97
All equipment covered under a specific Master Lease Agreement
The First National Bank of Boston, as Agent
2788149
5/13/97
All equipment covered under a specific Master Lease Agreement
The First National Bank of Boston, as Agent
2788152
5/13/97
All equipment covered under a specific Master Lease Agreement

 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Ameritech Credit Corporation
2797657
6/6/97
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2805885
7/1/97
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2813896
7/25/97
A true lease of computers and other data transmission devices
BankBoston, N.A., as Agent
2815854
7/30/97
All equipment covered under a specific Master Lease Agreement
First Security Bank, National Association
2839661
10/14/97
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2839662
10/14/97
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2839664
10/14/97
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2844941
10/29/97
A true lease of computers and other data transmission devices
CoreStates Bank, N.A., as Agent
2850008
11/13/97
All equipment covered under a specific Master Lease Agreement
Ameritech Credit Corporation
2854390
11/26/97
A true lease of computers and other data transmission devices
CoreStates Bank, N.A., as Agent
2879951
2/13/98
All equipment covered under a specific Master Lease Agreement

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

CoreStates Bank, N.A., as Agent
2879952
2/13/98
All equipment covered under a specific Master Lease Agreement
Ameritech Credit Corporation
2890603
3/16/98
A true lease of computers and other data transmission devices
Ameritech Credit Corporation
2890604
3/16/98
A true lease of computers and other data transmission devices
Amdahl Corporation
2910900
4/30/98
A lease of specific computer equipment
CoreStates Bank, N.A., as Agent
2917909
5/26/98
All equipment covered under a specific Master Lease Agreement
CoreStates Bank, N.A., as Agent
2917910
5/26/98
All equipment covered under a specific Master Lease Agreement
Sanwa Business Credit Corporation
2925172
6/11/98
Specific pieces of equipment
First Union National Bank, as Agent
2949075
8/20/98
All equipment covered under a specific Master Lease Agreement
First Union National Bank, as Agent
2949076
8/20/98
All equipment covered under a specific Master Lease Agreement
First Union National Bank, as Agent
2971032
10/27/98
All equipment covered under a specific Master Lease Agreement
First Union National Bank, as Agent
2972988
11/03/98
All equipment covered under a specific Master Lease Agreement

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

First Union National Bank, as Agent
2977314
11/19/98
All equipment covered under a specific Master Lease Agreement
First Union National Bank, as Agent
2990811
1/5/99
All equipment covered under a specific Master Lease Agreement
Leasing Solutions, Inc.
3005560
2/22/99
All equipment covered under a specific Master Lease Agreement
Leasing Solutions, Inc.
3005562
2/22/99
All equipment covered under a specific Master Lease Agreement
Leasing Solutions, Inc.
3005564
2/22/99
All equipment covered under a specific Master Lease Agreement
Leasing Solutions, Inc.
3005566
2/22/99
All equipment covered under a specific Master Lease Agreement
Leasing Solutions, Inc.
3013343
3/17/99
All equipment covered under a specific Master Lease Agreement
Ameritech Credit Corporation
3030853
4/30/99
A true lease of computers and other data transmission devices
Jurisdiction Searched: St. Louis City, MO
Forsythe/McArthur Associates
3023
7/18/91
Computer, data processing, telecommunications and other equipment pursuant to a Master Equipment Lease Agreement between the Debtor and Secured Party

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Ameritech Credit Corporation
06720
10/18/99
A lease of (5) Canon Color Copiers and  all computers and other data transmission devices pursuant to a certain true lease agreement
DEBTOR NAME: BROWN GROUP RETAIL, INC.
Jurisdiction Searched: Alabama Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
1998-41238
9/28/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
1999-22262
5/24/99
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Arizona Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
1035398
9/28/98
A true lease of specific equipment.
Jurisdiction Searched: California Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
9827560075
9/29/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
9832161006
11/12/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
9914660348
5/24/99
A true lease of specific equipment.
Jurisdiction Searched: Colorado Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
19982061237
9/28/98
A true lease of specific equipment.

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)
 
Fleet Capital Corporation (for itself and/or as Agent)
19982070099
11/13/98
A true lease of specific equipment.
Jurisdiction Searched: Connecticut Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
0001876558
9/15/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
0001879579
9/29/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
0001888811
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Delaware Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
19980043677
9/28/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
980000253452
11/12/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
990000126668
6/4/99
A true lease of specific equipment.
Jurisdiction Searched: Georgia Central Indexing
Fleet Capital Corporation (for itself and/or as Agent)
033-1998-014688 (Cobb County)
9/30/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
075-1998-001996 (Henry County)
9/30/98
A true lease of specific equipment.

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
067-1998-012768 (Gwinnett County)
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
064-1998-001846 (Gordon County)
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
060-1998-020343 (Fulton County)
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
044-1998-009748 (Dekalb County)
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
011-1998-005300 (Bibb County)
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
042-1998-000761 (Dawson County)
10/2/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
078-1998-001511 (Jackson County)
11/12/98
A true lease of specific equipment.
Jurisdiction Searched: Idaho Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
B812308
9/28/98
A true lease of specific equipment.
Jurisdiction Searched: Illinois Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
3910196
9/17/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
3918226
10/1/98
A true lease of specific equipment.
Jurisdiction Searched: Indiana Secretary of State

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
2213199
9/16/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
2215209
9/28/98
A true lease of specific equipment.
Jurisdiction Searched: Kansas Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
002491138
9/18/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
002493451
9/28/98
A true lease of specific equipment.
Jurisdiction Searched: Kentucky Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
156263
9/15/98
A true lease of specific equipment.
Jurisdiction Searched: Louisiana Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
26-227310 (Jefferson Parish)
10/5/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
36-133668 (Orleans Parish)
11/12/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
55-1033459 (Terrebonne Parish)
11/13/98
A true lease of specific equipment.
Jurisdiction Searched: Maine Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
19980001293083
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Maryland Secretary of State

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

L’Eggs Products, a division of Sara Lee Corporation
00000001128273083365-0037
10/8/91
Consigned inventory, goods, merchandise and other personal property
Fleet Capital Corporation (for itself and/or as Agent)
00391000000282910025-1460
9/28/98
A true lease of specific equipment.
Jurisdiction Searched: Massachusetts Secretary of the Commonwealth
Fleet Capital Corporation (for itself and/or as Agent)
590270
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
580097
9/28/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Worchester County, MA
Fleet Capital Corporation (for itself and/or as Agent)
120306
12/11/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Norfolk County, MA
Fleet Capital Corporation (for itself and/or as Agent)
710
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
4474 (Town of Wrentham)
9/28/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Jurisdiction Searched: Plymouth County, MA
Fleet Capital Corporation (for itself and/or as Agent)
1359 (Town of Hanover)
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Hampden County, MA
Fleet Capital Corporation (for itself and/or as Agent)
37904
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Michigan Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
D426346
9/30/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
D521852
5/24/99
A true lease of specific equipment.
Jurisdiction Searched: Minnesota Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
2073103
10/2/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
2132215
5/18/99
A true lease of specific equipment.
Jurisdiction Searched: Mississippi Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
1269610
11/12/98
A true lease of specific equipment.
Jurisdiction Searched: Harrison County, MS

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98-08943
11/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Missouri Secretary of State
General Electric Capital Corporation
2401714
5/4/94
A sale/leaseback transaction of 1 Rolm 9751, Model 40, 9005 Phone System
SunTrust Bank, Atlanta Commercial Leasing
2685020
7/9/96
A lease of specific equipment
Ameritech Credit Corporation
2828020
9/8/97
A lease of all telecommunications and data equipment provided by that certain lease between the Secured Party and Debtor
Fleet Capital Corporation (for itself and/or as Agent)
2956586
9/14/98
A true lease of specific equipment (listing not attached), generally described as New General Sale Registers and ancillary equipment
Fleet Capital Corporation (for itself and/or as Agent)
2971149
10/2/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
2975773
11/13/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
3000249
2/3/99
A true lease of specific equipment, generally described as various Dell computer equipment
Fleet Capital Corporation (for itself and/or as Agent)
3006411
2/25/99
A true lease of specific equipment, generally described as various Cisco routers

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
3037651
5/24/99
A true lease of specific equipment, generally described as Sale Registers and ancillary equipment
Fleet Capital Corporation (for itself and/or as Agent)
3032791
5/10/99
A true lease of specific equipment, generally described as various IBM radio frequency scanners
Fleet Capital Corporation (for itself and/or as Agent)
3047766
6/21/99
A true lease of specific equipment, generally described as telephone systems
Fleet Capital Corporation (for itself and/or as Agent)
4000367
1/5/2000
A true lease of specific equipment, generally described as fifty Cisco series routers
Fleet Capital Corporation (for itself and/or as Agent)
4000368
1/5/2000
A true lease of 781 symbol ruggedized palm terminals
Jurisdiction Searched: Clay County, MO
Fleet Capital Corporation (for itself and/or as Agent)
H168360
9/18/98
A true lease of specific equipment, generally described as Sale Registers and ancillary equipment
Jurisdiction Searched: Taney County, MO
Fleet Capital Corporation (for itself and/or as Agent)
00704
9/18/98
A true lease of specific equipment (listing not attached), generally described as New General Point of Sale Registers and ancillary equipment
Jurisdiction Searched: Camden County, MO

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
982307
9/17/98
A true lease of specific equipment (listing not attached), generally described as New General Point of Sale Registers and ancillary equipment
Jurisdiction Searched: St. Louis County, MO
Ameritech Credit Corporation
11057
9/15/97
A lease of all telecommunications and data equipment provided by that certain lease between the Secured Party and Debtor
Fleet Capital Corporation (for itself and/or as Agent)
11316
9/18/98
A true lease of specific equipment (listing not attached), generally described as New General Point of Sale Registers and ancillary equipment
Jurisdiction Searched: St. Charles County, MO
Fleet Capital Corporation (for itself and/or as Agent)
03626
9/16/98
A true lease of specific equipment (listing not attached), generally described as New General Point of Sale Registers and ancillary equipment
Jurisdiction Searched: Nebraska Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
783718
9/30/98
A true lease of specific equipment
Jurisdiction Searched: Nevada Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
9815554
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Jurisdiction Searched: New Hampshire Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
524557
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Rockingham County, NH
Fleet Capital Corporation (for itself and/or as Agent)
Book 3340, Page 2545
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: New Jersey Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
1865155
10/8/98
This filing was disclosed on Agent’s UCC searches  but a copy of the actual filing was not available. A subsequent online search did not show this filing. Loan Parties’ assume that this filing if effective, reflects a true lease of specified equipment
Fleet Capital Corporation (for itself and/or as Agent)
1871000
11/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Jurisdiction Searched: New York Department of State
Fleet Capital Corporation (for itself and/or as Agent)
197458
9/15/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
207608
9/29/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
240410
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Niagara County, NY
Fleet Capital Corporation (for itself and/or as Agent)
284823
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Westchester County, NY

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98-08094
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Erie County, NY
Fleet Capital Corporation (for itself and/or as Agent)
Q56-3655
11/17/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Ontario County, NY
Fleet Capital Corporation (for itself and /or as Agent)
98-4025
11/13/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Suffolk County, NY
Fleet Capital Corporation (for itself and/or as Agent)
9816676
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Nassau County, NY

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98016783
9/24/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Rockland County, NY
Fleet Capital Corporation (for itself and/or as Agent)
1998-00047431
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Almance County, NC
Fleet Capital Corporation (for itself and/or as Agent)
98-2077
10/2/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Wake County, NC
Fleet Capital Corporation (for itself and/or as Agent)
98-7937
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Guilford County, NC

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT

ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
479274
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Ohio Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
AP0085216
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Franklin County, OH
Fleet Capital Corporation (for itself and/or as Agent)
199809160235362
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Fayette County, OH
Fleet Capital Corporation (for itself and/or as Agent)
98-1684
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Cuyahoga County, OH

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)
 
Fleet Capital Corporation (for itself and/or as Agent)
98-1431593
9/17/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Lake County, OH
Fleet Capital Corporation (for itself and/or as Agent)
98204275
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Summit County, OH
Fleet Capital Corporation (for itself and/or as Agent)
98-21022186
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Richland County, OH
Fleet Capital Corporation (for itself and/or as Agent)
98-10912
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Stark County, OH
Fleet Capital Corporation (for itself and/or as Agent)
70354
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Greene County, OH

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98-2450
9/18/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Delaware County, OH
Fleet Capital Corporation (for itself and/or as Agent)
98-62146
9/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Oklahoma County Clerk, OK
Fleet Capital Corporation (for itself and/or as Agent)
N0008093
10/6/98
A true lease of specific equipment.
Jurisdiction Searched: Oregon Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
441258
10/1/98
A true lease of specific equipment.
Jurisdiction Searched: Pennsylvania Secretary of the Commonwealth
Fleet Capital Corporation
20030365599
4/13/03
A true lease of specific equipment, generally described as point of sale computers, retail equipment, wireless radio communications equipment and other miscellaneous equipment.
IBM Credit LLC
20031126679
11/10/2003
A true lease of specific equipment
IBM Credit LLC
20031204579
12/11/2003
A true lease of specific equipment
IBM Credit LLC
20040518567
5/14/2004
A true lease of specific equipment
IBM Credit LLC
20040650818
6/24/2004
A true lease of specific equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

IBM Credit LLC
200400904655
8/30/2004
A true lease of specific equipment
IBM Credit LLC
2005080100834
8/01/2005
A true lease of specific equipment
IBM Credit LLC
2005090801820
9/08/2005
A true lease of specific equipment
IBM Credit LLC
20050902202264
9/22/2005
A true lease of specific equipment
IBM Credit LLC
2005112201039
11/22/2005
A true lease of specific equipment
IBM Credit LLC
2006020101800
2/01/2006
A true lease of specific equipment
IBM Credit LLC
2007061304077
6/13/2007
A true lease of specific equipment
IBM Credit LLC
2008040107583
4/01/2008
A true lease of specific equipment
IBM Credit LLC
2008061907786
6/19/2008
A true lease of specific equipment
PNC Leasing, LLC
2004121506250
12/01/2004
A lease of specific equipment
Wells Fargo Equipment Finance Debtor name includes d/b/a Famous Footwear
34181063
7/30/2001
A lease of specific computer equipment
Wells Fargo Equipment Finance Debtor name includes d/b/a Famous Footwear
34401460
9/23/2001
A lease of specific computer equipment
Jurisdiction Searched: Prothonotary of Allegheny County, PA
Fleet Capital Corporation (for itself and/or as Agent)
98-8374
11/13/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Jurisdiction Searched: Prothonotary of Chester County, PA
Fleet Capital Corporation (for itself and/or as Agent)
ST982943
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Prothonotary of Delaware County, PA
Fleet Capital Corporation (for itself and/or as Agent)
98-202799
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Prothonotary of Westmoreland County, PA
Fleet Capital Corporation (for itself and/or as Agent)
2055 of 1998
11/12/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Prothonotary of Montgomery County, PA
Fleet Capital Corporation (for itself and/or as Agent)
277498
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Prothonotary of Bucks County, PA
Fleet Capital Corporation (for itself and/or as Agent)
98-64209
10/8/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Prothonotary of Leigh County, PA

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98UC-1555
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
 
Jurisdiction Searched: Prothonotary of Lancaster County, PA
Fleet Capital Corporation (for itself and/or as Agent)
98-10734
9/30/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: South Carolina Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
131546A
10/1/98
A true lease of specific equipment.
Fleet Capital Corporation (for itself and/or as Agent)
114811A
11/13/98
Fleet Capital Corporation (for itself and/or as Agent)
Jurisdiction Searched: Tennessee Secretary of State
 
Fleet Capital Corporation (for itself and/or as Agent)
983608381
10/1/98
A true lease of specific equipment.
 
Fleet Capital Corporation (for itself and/or as Agent)
993008923
2/26/99
A true lease of specific equipment, generally described as various Dell computer equipment.
 
Fleet Capital Corporation (for itself and/or as Agent)
993033702
6/21/99
A true lease of specific equipment, generally described as telephone systems.
 
Jurisdiction Searched: Texas Secretary of State
 

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
98-00197544
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
98-00228404
11/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Virginia State Corporate Commission
Fleet Capital Corporation (for itself and/or as Agent)
9810017139
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
9811167201
11/16/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
9905247159
5/24/99
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Fairfax County, VA
Fleet Capital Corporation (for itself and/or as Agent)
98-009650
10/5/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
98-009651
10/5/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Jurisdiction Searched: James City County, VA
Fleet Capital Corporation (for itself and/or as Agent)
20816
10/8/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Spotsylvania County, VA
Fleet Capital Corporation (for itself and/or as Agent)
98-0001225
11/5/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Chesapeake Independent City, VA
Fleet Capital Corporation (for itself and/or as Agent)
61578
10/5/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Hampton Independent City, VA
Fleet Capital Corporation (for itself and/or as Agent)
84759
10/5/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Washington Secretary of State
Fleet Capital Corporation (for itself and/or as Agent)
982740259
10/1/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: West Virginia Secretary of State

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Fleet Capital Corporation (for itself and/or as Agent)
506269
11/13/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Jurisdiction Searched: Wisconsin Secretary of State
First Federal Financial Service Inc.
1366026
7/9/93
A lease of specific computer equipment
EVCC
1366027
7/9/93
A lease of specific computer equipment
General Electric Capital Corporation Debtor name includes d/b/a Famous Footwear
1427121
5/4/94
A lease of 1 Rolm Model 9005 Phone System
Caterpillar Financial Services Corporation Debtor name includes d/b/a Famous Fixtures
1683521
6/30/97
4 Caterpillar Lift Trucks and proceeds thereof
Ameritech Credit Corporation
1701916
9/19/97
A lease of all telecommunications and data equipment pursuant to a certain lease agreement
Sun Data, Inc. Debtor name includes d/b/a Famous Footwear
1731232
1/26/98
A lease of specific computer equipment
Fleet Capital Corporation (for itself and/or as Agent)
1793769
10/2/98
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
1827313
2/25/99
A true lease of specific equipment, generally described as various Cisco Routers
Sun Data, Inc. Debtor name includes d/b/a Famous Footwear
1838157
4/12/99
A lease of specific computer equipment

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Sun Data, Inc. Debtor name includes d/b/a Famous Footwear
1845243
5/7/99
A lease of specific computer equipment
Fleet Capital Corporation (for itself and/or as Agent)
1849480
5/24/99
A true lease of specific equipment, generally described as New General Point of Sale Registers and Ancillary Equipment
Fleet Capital Corporation (for itself and/or as Agent)
01856502
6/21/99
A true lease of specific equipment, generally described as Telephone Systems
CD Leasing, Inc.
01880760
9/13/99
A true lease of specific equipment
Fleet Capital Corporation (for itself and/or as Agent)
01917228
1/13/2000
A true lease of specific equipment, generally described as 781 Symbol Ruggedized Palm Terminals
Fleet Capital Corporation (for itself and/or as Agent)
01917231
1/13/2000
A true lease of specific equipment, generally described as Fifty Cisco 1600 Series Routers
Solarcom LLC
01989405
9/6/2000
A true lease of specific computer equipment
C D Leasing, LLC
02030984
1/30/2001
A true lease of specific computer equipment
DEBTOR NAME: BENNETT FOOTWEAR GROUP LLC
Jurisdiction Searched: Massachusetts Secretary of State
Fidelity Leasing Inc.
2001021627560
5/10/01
Specific Equipment
Jurisdiction Searched: Town Clerk of Newton, MA

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.2 TO AMENDED AND RESTATED CREDIT AGREEMENT
 
ANNEX A (Continued)

Fidelity Leasing Inc.
324-2001
5/21/2001
[Awaiting copy of filing]
Jurisdiction Searched:  New Hampshire Secretary of State
Crown Credit Company
580067
5/9/01
Specific Equipment
Citicorp Vendor Finance, Inc.
580068
5/9/01
Specific Equipment
Jurisdiction Searched: Town Clerk of Dover, NH
Crown Credit Company
173
5/10/01
Specific Equipment

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

Store Number
Address
Store Unit
Secured Party
Registration Number
Hypothec
Comments
4582
552 Boulevard Wilfrid-Hamel, QC
 
Place Fleur De Lys (S.E.N.C.)
99-0023556-0001
All present and future furniture, equipment, inventory and other assets located at address: $40,000
Cession of rank signed on February 4, 2002 and published under number 02-0139528-0002
2565
4118 Jean-Talon Est, Saint-Léonard, QC
 
Centre d'Achats du Boulevard (Montréal)
Société en Commandite
06-0241366-0021
Universality of present and future furniture, equipment, inventory, merchandise and other moveable asset located at address: $29,907
 
2556
2305, Chemin Rockland, Montréal, QC
 
Centre Commercial Rockland Inc.
Rockland Shopping Centre Inc.
05-0345844-0002
Universality of present and future moveable goods including, without limitation, all equipment and inventory located at address: $100,000
 
2594
298, Boul. Armand Thériault, Rivière-des-loups (Quebec)
 
9130-1168 Québec Inc.
05-0087482-0015
Universality of present and future moveable goods, including, without limitation, equipment and inventory located at address: $50,000
 

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number
Address
Store Unit
  Secured Party
Registration Number
  Hypothec
Comments
1510
1, Place Ville Marie, Montréal, QC
 
SITQPVM I Inc., SITQPVM II Inc., SITQPVM III Inc.
03-0614796-0001
All improvements, moveable goods, equipment and all machinery, including insurance located at address: $132,500
Cession of rank signed on July 5, 2004 and published under number 04-0580065-0005
1509
2151 Boul. Lapinière, Brossard (Québec)
 
Ivanhoé Champlain Inc.
03-0365697-0017
Universality of all present and future moveable, tangible and intangible goods located at address, including without limitation equipment and inventory: $100,000
Cession of rank signed on August 11, 2004 and published under number 04-0580065-0004
Cession of rank will expire on July 16, 2013 or any renewal thereof.
2579
320 Boul. St-Joseph, Hull, Québec
 
Les Galeries de Hull Limited
03-0216191-0014
Universality of furniture, equipment, stocks and other future or present goods located at address: $43,142
Cession of rank signed on August11, 2004 and published under number 04-0580065-0009
Cession of rank will expire on March 30, 2012 or any renewal thereof

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number   Address   Store Unit   Secured Party   Registration Number    Hypothec   Comments
2559
2151, Lapinière Blvd., Brossard (QC)
 
Ivanhoé Champlain Inc.
03-0050587-0006
All present and future furniture, equipment, inventory and other assets located at address: $50,000
Cession of rank signed on August11, 2004 and published under number 04-0580065-0008
Cession of rank will expire on December 30, 2012 or any renewal thereof
2500
677, rue Ste-Catherine Ouest, Montréal (QC) au Complexe Les Ailes
 
Invanhoé Champlain Inc.
02-0541087-0010
Universality of all moveable goods, tangible and intangible, located at address: $100,000
Cession of rank signed on August11, 2004 and published under number 04-0580065-0001
Cession of rank will expire on November 29, 2012 or any renewal thereof

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number   Address   Store Unit   Secured Party   Registration Number    Hypothec   Comments
2575
4225 boul. Des Forges, Trois-Rivières, Qc
(as rectified pursuant to registration 03-0608277-0001)
A12
Les Rivières Shopping Centre Limited
00-0058217-0001
All present and future furniture, equipment, inventory and other assets located at address. Includes all moveables even after removal from the premises: $71,190
Cession of rank signed on January 9, 2002 and published under number 02-0047646-0003
1525
4225 boul. Des Forges, Trois-Rivières, Qc
 
(as rectified pursuant to registration 03-0608277-0001)
D8
Les Rivières Shopping Centre Limited
00-0039180-0001
All present and future furniture and equipment, inventory and other assets located from time to time at address: $90,000
Cession of rank signed on January 9, 2002 and published under number 02-0047646-0003
 

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number   Address   Store Unit   Secured Party   Registration Number    Hypothec   Comments
2562
6000, Boul. Henri-Bourassa Est, Montréal-Nord (Quebec)
 
Ivanhoé Inc.
Ivanhoe Inc.
00-0014128-0002
Universality of all moveables, tangible and intangible, present and future located at address: $50,000
Cession of rank signed on January 9, 2002 and published under number 02-0047646-0005
2565
4118 Jean Talon Est, Montréal (QC)
 
Les Entreprise Ludco Ltée
00-0004049-0005
All of the rights, title and interests of the grantor in and to the universality of all moveable improvements, all present and future furniture, equipment, inventory and other assets located at address: $22,000
Cession of rank signed on November 28, 2001 and published under number 02-0033202-0008
 
2570
Plaza de La Maurice Shopping Centre, 1, Plaza de la Maurice, Shawinigan (QC)
13A
Fairfay Corporation
99-0081084-0001
All present and future furniture, equipment, inventory and other assets located at address: $34,160
Cession of rank signed on November 23, 2001 and published under number 02-0075703-0004
 

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number   Address   Store Unit   Secured Party   Registration Number    Hypothec   Comments
2590
Centre Commercial Place du Royaume (Phase 3), 1401 Boulevard Talbot, Chicoutimi (QC)
B-64 and B-65
Centre Commercial Place du Royaume (Chicoutimi) Inc.
99-0037285-0001
Universality of moveable goods, present and future located at address: $41,475
Cession of rank signed on February 1, 2002 and published under number 02-0075703-0001
Borealis Retail Real Estate Investment Trust
05-0551603-0001
All of Assignor's rights, title and interest in, to and under all leases listed or described in Schedule “A” to registration (Place du Royaume) Chicoutimi
 
1520
2450, Boul. Laurier, Ste-Foy (QC)
 
Ivanhoé III Inc.
96-0134191-0001
Universality of all the moveable goods, tangible or intangible, present and future located at address: $110,000
Cession of rank signed on January 9, 2002 and published under number 02-0047646-0002
 
2578
1100 Maloney Boulevard West, Gatineau (QC)
 
David Azriel J.
99-0163722-0001
Universality of all moveables, improvements, equipment, machinery, furniture, trade fixtures, raw material, work in progress and inventory of every kind, present and future, located at address: $28,500
Cession of rank signed on November 29, 2001 and published under number 02-0033202-0001
 

 
 
 
BROWN SHOE COMPANY, INC.
ANNEX B TO SCHEDULE 6.2

LIENS IN FAVOR OF LESSORS UNDER LEASES
WITH BROWN SHOE COMPANY OF CANADA LTD (Continued)

  Store Number   Address   Store Unit   Secured Party   Registration Number    Hypothec   Comments
1520
2450 Boul. Laurier, Ste-Foy, Qc
161
Ivanhoé Inc. / Ivanhoe Inc.
99-0025239-0008
The universality of all movable property, corporeal and incorporeal, present and future, including equipment and inventory located at address.
$100,000
Cession of rank signed on January 9, 2002 and published under number 02-0047646-0002
2555
977 West Ste-Catherine Street, Montreal, Qc
 
L’Immobilière L’Industrielle-Alliance-Vie Inc.
01-0051255-0002
All present and future furniture, equipment, inventory and other assets located at address.
$44,381
Cession of rank signed on January 31, 2002 and published under number 02-0075703-0008
 
2585
8585 Boul. Lacroix, St-Georges de Beauce, Qc
 
SITQ National Inc.
02-0565248-0002
All present and future furniture, equipment, inventory and other assets located at address.
$28,530
Cession of rank signed on August 11, 2004 and published under number 05-0111677-0001
Cession of rank will expire on February 29, 2012 or any renewal thereof

2. All of the leased Canadian retail stores listed on Schedule 3.5(b)

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.4 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

INVESTMENTS


1.   Stock held by the Lead Borrower in each subsidiary and Investments in such subsidiary.
 
 
 
 
Name
 
 
Authorized Shares of  Capital Stock (as of 1/7/09)
 
Issued and Outstanding Shares of Capital Stock (as of 1/7/09)
 
Percentage of Capital Stock Owned, Directly or Indirectly, by the Lead Borrower (as of 1/7/09)
 
Invested Capital*
$000’s (as of 11/30/08)
Bennett Footwear Group LLC
Not Applicable
Not Applicable
100%
Not Available
Brown California, Inc.
100
100
100%
-
Brown Group Retail, Inc.
10,000
10,000
100%
$302,311
Brown Missouri, Inc.
2,000
2,000
100%
-
Brown Retail Development Company, Inc.
2,000
1,000
100%
-
Brown Shoe International Corp.
10,000
2,000
100%
-
Brown Shoe Investment Company, Inc.
2,000
2,000
100%
$8,961
Brown Shoe Services Corporation
10,000
2,000
100%
$(1,521)
Brown Texas, Inc.
100
100
100%
-
Buster Brown & Co.
2,000
2,000
100%
$432
Edelman Shoe, Inc.
1000 Common
425 Series A Preferred
50 Series B Preferred
475 Common
425 Series A Preferred
50 Series B Preferred
 
50%
 
Maryland Square, Inc.
1000
1000
100%
-
Maserati Footwear, Inc.
1,000
1,000
100%
-
Pagoda Trading North America, Inc.
2,000
2,000
100%
-

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.4 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

INVESTMENTS (Continued)

 
 
Name
 
 
Authorized Shares of  Capital Stock (as of 1/7/09)
 
Issued and Outstanding Shares of Capital Stock (as of 1/7/09)
 
Percentage of Capital Stock Owned, Directly or Indirectly, by the Lead Borrower (as of 1/7/09)
 
Invested Capital*
$000’s (as of 11/30/08)
Shoes.com, Inc.
Common: 4,000,000
Preferred: 3,000,000
Common: 114,024
Preferred: 1,224,726 Class A-1
100%
$20,028
 
Sidney Rich Associates, Inc
2,000
2,000
100%
$2,814
B&H Footwear Company Limited
4,284,500
4,284,500
51%
$2,185
Brown Cayman Ltd.
101,000
101,000
100%
$(80)
Brown Group Dublin Limited
150,000
150,000
100%
$62,157
Brown Shoe Asia Investment Limited
1,000
1,000
100%
$1,000
Brown Shoe Company of Canada Ltd
Class A(5%):31,500
Class B: 89,166
 
Class A(5%): 31,500
Class B: 50,441
 
100%
$47,261
Brown Shoe International (Macau) Company Limited
MOP 100,000
MOP 100,000
100%
$12,821
Brown Shoe International Sales and Licensing Limited
1,000
1,000
100%
($399)
Brown Shoe International Sales and Licensing S.r.l.
100% of total authorized capital
100% of total authorized capital
100%
$4,893
Brown Shoe Service Company Limited
HK$7,000
1,000
100%
$(25)
DongGuan B&H Footwear Company Limited
100% of total authorized capital
100% of total authorized capital
100%
 
 

*   Invested Capital is defined as total shareholders’ equity plus financing liabilities.
 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.4 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

INVESTMENTS (Continued)

 
Name
 
 
Authorized Shares of  Capital Stock (as of 1/7/09)
 
Issued and Outstanding Shares of Capital Stock (as of 1/7/09)
 
Percentage of Capital Stock Owned, Directly or Indirectly, by the Lead Borrower (as of 1/7/09)
 
Invested Capital*
DongGuan Brown Shoe Company Limited
100% of total authorized capital
100% of total authorized capital
100%
$660,000
DongGuan Leeway Footwear Company Limited
100% of total authorized capital
100% of total authorized capital
100%
$1,715
 
Great Prosper Profits Corporation
US$50,000
$1
100%
 
Laysan Company Limited
144,000,000
143,706,197
100%
 
Leeway International Company Limited
30,000
30,000
100%
$(1,746)
$10,127
Pagoda International Corporation do Brasil, LTDA
100% of Total “Quotas” Owned
100% of Total “Quotas” Owned
100%
$247
Pagoda International Footwear Limited
1,500,000
1,492,879
100%
$276
 
Pagoda International Footwear (Macao Commercial Offshore) Ltd.
MOP 78,000
MOP78,000
100%
 
Pagoda Leather Limited
15,309,023
15,309,023
100%
-
Putian Brown Shoe Company Limited
100% of total authorized capital
100% of total authorized capital
100%
$197
Whitenox Limited
7,300,000
7,206,168
100%
 

 
2.           The Lead Borrower holds various shares of stock received in the ordinary course of business (see 6.4(d) of the Credit Agreement) that it believes have no meaningful value and are not included as an asset on its Statement of Financial Position.
 
3.           The Lead Borrower is the holder of 300,000 shares of stock in Regal Corporation, a Japanese entity; the number of shares issued and outstanding, and the percentage owned is not known.
 
*   Invested Capital is defined as total shareholders’ equity plus financing liabilities.

 
 
 
BROWN SHOE COMPANY, INC.
SCHEDULE 6.4 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

4.           The Lead Borrower is contingently liable for lease commitments of approximately $1.7 million in the aggregate, which primarily relate to the Cloth World and Meis specialty retailing chains, which were sold in prior years  In order for the Company to incur any liability related to these guarantees and lease commitments, the current owners would have to default.  At this time, the Company does not believe this is reasonably likely to occur.
 
 
 
*   Invested Capital is defined as total shareholders’ equity plus financing liabilities.


 
 
 

BROWN SHOE COMPANY, INC.
SCHEDULE 6.6 TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

RESTRICTIVE AGREEMENTS

The Indenture, dated as of April 22, 2005, among the Lead Borrower, the guarantors party thereto and U.S. Bank National Association, as successor trustee (as supplemented by that certain Supplemental Indenture, dated as of October 24, 2007, between Shoes.com Inc., the Lead Borrower and U.S. Bank National Association, as successor trustee and as further supplemented from time to time), with respect to the 8.75% Senior Notes.
 
 
.

 
 
 


 
 
 

Exhibit 10.2
 
Summary of Compensatory Arrangements
for the Named Executive Officers
of Brown Shoe Company, Inc.
 
Fiscal 2009 Compensation.   For the named executive officers (“NEOs”) in our 2008 Proxy Statement, the Compensation Committee (“Committee”) determined that there would be no merit increases for 2009; thus, base salaries will not increase and, consistent with a plan previously adopted by the Company, a 1.5% salary expense savings will result from closing our headquarters office for four additional days during 2009.  The Committee approved annual incentive award targets for fiscal 2009 and restricted stock awards for our NEOs, as shown in the table below and described in the text that follows:
 
 

 
Annual Incentive
 
 
Name and Title of Executive Officer
Target Level Percent of Salary (%)
Target Cash
  Award ($)
Restricted Stock Award (#)
Ronald A. Fromm
Chairman of the Board and Chief Executive Officer
90%
$765,000
82,675
Mark E. Hood
       Senior Vice President and Chief Financial Officer
55%
206,250
25,000
Diane M. Sullivan
President and Chief Operating Officer
80%
588,000
51,000
Joseph W. Wood
President, Retail Alliance and President, Famous Footwear
70%
372,400
25,000
Richard M. Ausick
       President, Authority Brand Alliance
60%
289,800
25,000


Annual Incentive Awards Granted for Fiscal 2009 .  The Committee approved an annual incentive award plan pursuant to the terms of our 2002 Incentive Stock and Compensation Plan, as Amended and Restated.  The target cash award levels for the NEOs as a percent of base salary will be the same as for fiscal 2008. The Committee approved two performance metrics for the plan applicable to our NEOs.  One metric is “Adjusted EPS” (consolidated diluted earning per share, as adjusted for non-recurring losses and recoveries) and the second metric is “Adjusted EBITDA as a percent of Average Net Assets.”  For purposes of the second metric, EBITDA  (Earnings Before Interest, Taxes and Depreciation for the fiscal year) will be adjusted for non-recurring losses and recoveries. “Average Net Assets” will be the calculated as the average of month-end Net Assets during the fiscal year; and “Net Assets” will be the sum of property and equipment (net), capitalized software (net) and working capital.  If we meet our planned performance goals, a NEO will earn fifty percent of the target cash award, with the possibility of up to two times the target cash award if the Company’s performance is exceptionally strong.  The threshold payout is 30% of the target cash award, provided a base level of Adjusted EPS is achieved.  In addition, the Committee has discretion to reduce the award amount based on an individual’s performance and quality of earnings.  The NEO must remain an employee through the payment date; and the award provides for forfeiture if, prior to payment, the Committee determines that the NEO has violated our Code of Conduct or engaged in gross misconduct.

Restricted Stock .  The Committee approved grants of restricted stock to the NEOs with service-based cliff vesting at the end of the fourth year.  The form of restricted stock award agreement is attached as Exhibit A and incorporated herein by reference.
 
Benefit Plans and Other Arrangements .  The NEOs are eligible to participate in Company programs available to all employees, including health, disability and life insurance programs, relocation assistance, and qualified 401(k) and pension plans.
 
The NEOs also participate in a Supplemental Executive Retirement Plan (SERP), which effectively replaces a benefit that higher-earning employees lose under the tax-qualified pension plan and in certain aspects enhances the benefits in favor of the participating employee.  Each of the NEOs is a party to a severance agreement that contains a non-compete provision and provides benefits upon certain events of termination, including those following a change of control.
 
The NEOs are also eligible to participate in a non-qualified Deferred Compensation Plan that allows the participant to defer up to 50% of base salary and up to 100% of other compensation, with deferral only of cash compensation authorized, and with deferral until termination or other date specified date by the participant.
 
In addition, the NEOs may receive perquisites, including personal use of the corporate aircraft, financial and tax planning services, executive disability, executive physicals and club memberships.

 
 
 

Exhibit A
RESTRICTED STOCK AWARD AGREEMENT - Employee

BROWN SHOE COMPANY, INC.


THIS AGREEMENT represents the grant of a Restricted Stock Award (the “Award”) by Brown Shoe Company, Inc., a New York corporation (the “Company”), to the Participant named below, pursuant to the provisions of the Incentive and Stock Compensation Plan of 2002, as Amended and Restated as of May 22, 2008 (the “Plan”), as follows:

1.    Terms of the Award .  The terms of the Award are as follows:
 
Participant :  «First_Name» «Middle_Init» «Last_Name»
 
Award Grant Date :  _____, 200_ [**date of board or committee approval]
 
Number of Restricted Shares:     ___ Shares of Brown Shoe Company, Inc. Common Stock, subject to certain restrictions
 
Vesting Schedule  (Lapse of Restrictions): ____ __, 201_ as to 100% of the Restricted Shares [** 4th anniversary of the Grant Date]
 

2.   Restrictions

The Restricted Shares are restricted as to disposition and may not be pledged; and are subject to forfeiture unless certain conditions are met.  The Company’s transfer agent has been advised that the Restricted Shares cannot be sold, transferred, re-registered or disposed of until the restrictions on the shares lapse.  Restricted Shares shall vest, and the restrictions shall no longer apply, as to the number or percentage of Restricted Shares and on the dates specified above as the “Vesting Schedule.” A further restriction on the Restricted Shares is that you shall only be entitled to receive Shares free of restrictions if, at the time of the lapse of such restrictions, you are then in the employ of the Company and shall have been continuously so employed since the date of grant of the Restricted Shares.  If you do not meet these conditions at any time, such Shares shall be forfeited.

3.   Voting Rights and Dividend Rights

You will be entitled to full voting rights and dividend rights for all Restricted Shares, beginning with the date of grant, regardless of restriction periods.  Dividends may be paid directly to you or may be credited to your dividend re-investment plan account.  Dividend rights and voting rights will be cancelled in the event the Restricted Shares are forfeited.

4.   Book Entry for Restricted Shares .  You will not receive a certificate for the Restricted Shares; instead, the Restricted Shares will be credited as a book entry to an account in your name with the Company’s transfer agent.  At such time as the restrictions lapse, those Shares that are no longer subject to restrictions shall be transferred to a non-restricted account in your name with the transfer agent or as otherwise directed by you and agreed by the Company.

5.   Death or Retirement .  In the event of termination of employment due to death, retirement at age 65, or early retirement approved by the Compensation Committee, all Restricted Shares shall vest immediately and be free of restrictions.

6.  Change in Control .  Subject to Article 2.7 and Article 13 of the Plan, unless otherwise specifically prohibited under applicable laws, or by the rules and regulations of any governing governmental agencies or national securities exchange, the Restricted Shares still subject to restrictions under this Agreement shall automatically vest and all restrictions shall lapse as of the vest and all restrictions shall lapse upon the occurrence of a Change in Control.

7.   Adjustment Upon Changes in Capitalization .  In accordance with Section 4.2 of the Plan, in the event that there is a change in the Common Stock of the Company by reason of stock dividends, split-ups, recapitalizations, mergers, consolidations, reorganizations, combinations or exchanges of shares, then the Restricted Shares shall be adjusted in the same manner as other shares of  Common Stock are adjusted.

8.   Tax Withholding .  The Board shall have the power and the right to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy Federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of the Award.

9.  Share Withholding .  With respect to withholding upon the lapse of restrictions on the Restricted Shares, or upon any other taxable event arising as a result of this grant of Restricted Shares, the Participant may elect, subject to the approval of the Board, to satisfy the withholding requirement, in whole or in part, by having the Company withhold Shares having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax which could be imposed on the transaction.  All such elections shall be irrevocable, made in writing, signed by the Participant, and shall be subject to any restrictions or limitations that the Board, in its sole discretion, deems appropriate.

10.  Nontransferability .  This Agreement and the Restricted Shares granted hereunder, until such time as the restrictions on the Shares have lapsed, may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.

11.  Administration and Interpretation .  This Award Agreement and the rights of the Participant hereunder are subject to all terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Board may adopt for administration of the Plan.  It is expressly understood that the Board is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Award Agreement, all of which shall be binding upon the Participant.  The Board may delegate to the Compensation Committee all determinations with respect to the Plan and this Award Agreement.  All capitalized terms used in this Award Agreement shall have the meanings ascribed to them in the Plan, unless specifically set forth otherwise herein.  If there is any inconsistency between the terms of this Award Agreement and the terms of the Plan, the Plan’s terms shall completely supersede and replace the conflicting terms of this Award Agreement.

12.  Miscellaneous
 
(a)
This Award Agreement shall not confer upon the Participant any right to continuation of employment by the Company, nor shall this Award Agreement interfere in any way with the Company’s right to terminate his or her employment at any time.
     
  (b)   The Board may terminate, amend, or modify the Plan; provided, however, that no such termination, amendment, or modification of the Plan may in any way adversely affect the Participant’s rights under this Award Agreement without the Participant’s written consent.
     
  (c)   This Award Agreement shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.
     
  (d) To the extent not preempted by Federal law, this Award Agreement shall be construed in accordance with and governed by the substantive laws of the State of Missouri without regard to conflicts of laws principles, which might otherwise apply.  Any litigation arising out of, in connection with, or concerning any aspect of the Plan or this Award Agreement shall be conducted exclusively in the State or Federal courts in Missouri.
 
 
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed effective as of date written below.


 
    BROWN SHOE COMPANY, INC.
   
   By: _________________________________________
          Sarah Stephenson, Vice President – Total Rewards
   
   Date: _______________________________
 
 


Accepted: ____________________________
Participant
 
Date:______________________

 
 
 

 
 
 

EXHIBIT 10.3
                                                                               
   December 18, 2009
 


Ronald A. Fromm
Chairman and CEO


Dear Ron:
 
Section 409A to the Internal Revenue Code (“IRC”) imposes significant limitations on amounts that are considered nonqualified deferred compensation (“NDC”).  Some payments under your Severance Agreement may be subject to these rules.  Therefore, in order to avoid potential negative tax implications to you, we must amend your Severance Agreement to ensure compliance with 409A.
 
In addition, the Internal Revenue Service (“IRS”) recently amended the rules governing the deductibility of compensation paid to top executives of a publicly traded company.  In general, IRC Section 162(m) provides that annual compensation in excess of $1 million is not deductible.  Performance based compensation, however, is not subject to the $1 million limitation.  To ensure payments made in connection with the bonus program are considered to be performance based compensation, we need to make revisions to your agreement.
 
Accordingly, in light of the 409A and 162(m) rules’ possible impact on your severance benefits, your Severance Agreement is amended as follows:
 
1.  
 Section 1.12 of your Severance Agreement is amended to read as follows:
 
1.12           “Termination Date” means the effective date as provided in this Agreement of the termination of Employee’s employment with the Company.  Employee will have a termination of employment only if he has a separation from service determined based on all of the facts and circumstances and in accordance with the rules and regulations issued by the Treasury Department under Code Section 409A.
 
2.  
Section 4.1(b) of your Severance Agreement is amended to read as follows:
 
(b)           The Company shall pay, or cause to be paid, to Employee (i) in a lump sum six (6) months after the Termination Date an amount equal to 200% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year, and (ii) Employee’s bonus for the year of termination prorated to the Termination Date, paid at the time such bonus would have been paid if Employee had remained employed to the date of payment and calculated based on achievement of the applicable performance criteria applicable to such bonus payment.
 
3.  
Section 6 of your Severance Agreement is amended to read as follows:
 
Section 6.                      Employee Expenses After Change in Control

If Employee’s employment is terminated by the Company within twenty-four (24) months after a Change in Control and there is a dispute with respect to this Agreement, then all Employee’s costs and expenses (including reasonable legal and accounting fees) incurred by Employee (a) to defend the validity of this Agreement, (b) to contest any termination for Cause, (c) to contest any determinations by the Company concerning the amounts payable by or on behalf of the Company under this Agreement, or (d) to otherwise obtain or enforce any right or benefit provided to Employee by this Agreement, shall be paid by the Company.  The Company shall make payment of such reimbursements from time to time, but in no event later than the last day of the calendar year following the calendar year in which such expenses are incurred, provided Employee timely submits reasonable documentation of such expenses.  In the event Employee is not the prevailing party in any such contest, Employee shall pay back any reimbursements made by the Company hereunder within 30 days of final disposition of such contest.

4.  
Section 7 of your Severance Agreement is amended to read as follows:
 
Section 7.                      Release
 
Notwithstanding anything to the contrary stated in this Agreement, no benefits will be paid pursuant to Section 4 except under Section 4.1(a), 4.2(a) or 4.3 prior to execution by Employee of a release of the Company substantially in the form attached as Exhibit A , with such changes as may be made by the Company in its sole discretion in order to comply with and stay current with applicable laws and regulations.  Unless Employee executes such release and returns it to the Company within 45 days of his Termination Date, all benefits except under Sections 4.1(a), 4.2(a) or 4.3 shall be forfeited.
 
5.  
Section 12.2(a) of your Severance Agreement is amended to read as follows:
 
(a)           Brown Shoe shall require any successor to all or substantially all of the business and/or assets of the Company (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise), prior to or upon such succession, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  To the extent such transaction constitutes a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company under Code Section 409A and the rules and regulations thereunder, failure of Brown Shoe to obtain such agreement upon or prior to the effectiveness of any such succession shall be a material breach of this Agreement and shall entitle Employee to benefits from the Company in the same amounts and on the same terms as Employee would be entitled hereunder if Employee’s employment was terminated without Cause within twenty-four (24) months after a Change of Control.  For purposes of the preceding sentence, the date on which any such succession becomes effective shall be deemed the Termination Date.

6.  
A new Section 12.11 is added to your Severance Agreement as follows:
 
12.11            409A Interpretation.   With respect to those amounts payable hereunder which are subject to Code Section 409A, this Agreement shall be interpreted in a manner so as to be consistent with such provision and the rules and regulations promulgated thereunder.  The Company may modify the Agreement to the extent necessary to prevent a benefit or payment from being subject to a tax due to noncompliance with Code Section 409A.  Notwithstanding anything herein to the contrary, in the event that Executive is determined to be a specified employee within the meaning of Code Section 409A, for purposes of any payment on termination of employment hereunder, payment(s) shall be made or begin, as applicable, on the first payroll date which is more than six months following the date of separation from service, to the extent required to avoid any adverse tax consequences under Code Section 409A.

Please indicate your agreement to the terms set forth above by signing a copy of this letter and returning it to me
 
Sincerely,
 
     /s/ Sarah Stephenson
 
Sarah Stephenson
 
Vice President Total Rewards
 

 
 
   Agreed and accepted:
   
   /s/ Ronald A.Fromm
   Ronald a. Fromm
   
   12/18/09
   Date
 


 
 
 


Exhibit A

RELEASE


THIS RELEASE (the “Release”) dated _____________ between Jane Doe (“Employee”) and Brown Shoe Company, Inc., a New York corporation;

WHEREAS, the Company and Employee are parties to a Severance Agreement dated _____________, 200___ and effective as of ______________, 200__ (the “Severance Agreement”);

WHEREAS, the execution of this Release is a condition precedent to, and material inducement to, the Company’s provision of certain benefits under the Severance Agreement;

NOW, THEREFORE, the parties hereto agree as follows:

1.            Mutual Promises.   The Company undertakes the obligations contained in the Severance Agreement, which are in addition to any compensation to which Employee might otherwise be entitled, in exchange for Employee’s promises and obligations contained herein and in the Severance Agreement. The Company’s obligations are undertaken in lieu of any other severance benefits.

2.            Releases of Claims; Agreements Not to File Suit .

a.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, agrees to, and does, remise, release and forever discharge the Company and its subsidiaries and affiliates, each of their shareholders, directors, officers, employees, agents and representatives, and its successors and assigns (collectively, the “Company Released Persons”), from any and all matters, claims, demands, damages, causes of action, debts, liabilities, controversies, judgments and suits of every kind and nature whatsoever, foreseen or unforeseen, known or unknown, which have arisen or could arise from matters which occurred prior to the date of this Release, which matters include without limitation: (i) the matters covered by the Severance Agreement and this Release, (ii) Employee’s employment, and/or termination from employment with the Company, and (iii) any claims which might otherwise arise in the future as a result of arrangements or agreements in effect as of the date of this Release or the continuance of such arrangements and agreements; provided, however, that this Section 2(a) shall not apply to any claims to the payments and benefits specifically provided for in the Severance Agreement or, subject to the terms of the Severance Agreement, the payments or benefits to which Employee, by reason of the termination of Employee’s employment, may be entitled under any employee benefit plan (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974) other than a severance pay plan.

b.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns, and anyone claiming through or under any of the foregoing, agrees that she will not file or otherwise submit any charge, claim, complaint, or action to any agency, court, organization, or judicial forum (nor will Employee permit any person, group of persons, or organization to take such action on Employee’s behalf) against any Company Released Person arising out of any actions or non-actions on the part of any Company Released Person arising before the date of this Release or any action taken after the date of this Release pursuant to the Severance Agreement.  Employee further agrees that in the event that any person or entity should bring such a charge, claim, complaint, or action on Employee’s behalf, Employee hereby waives and forfeits any right to recovery under said claim and will exercise every good faith effort to have such claim dismissed.

c.           The charges, claims, complaints, matters, demands, damages, and causes of action referenced in Sections 2(a) and 2(b) include, but are not limited to: (i) any claim for breach of an actual or implied contract (whether written or oral) of employment between Employee and any Company Released Person (including, but not limited to, any claim of fraud, promissory fraud, promissory estoppel, fraudulent misrepresentation or negligent misrepresentation in the making of any actual or implied contract of employment), (ii) any claim of unjust, wrongful, discriminatory, retaliatory or tortious discharge or other adverse employment action (including any claim of whistleblowing), (iii) any claim of slander, libel or other similar action for defamation, (iv) any claim of intentional tort (including assault, battery, conversion and/or intentional infliction of emotional distress), (v) any claim of negligence (including negligent infliction of emotional distress, negligent supervision, negligent hiring, or negligent retention), (vi) any claim of a violation of a law, statute or ordinance, including, but not limited to, the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq ., the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq . , the Americans with Disabilities Act of 1990, 42 U.S.C. §12101 et seq., the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §201 et seq ., the Rehabilitation Act of 1973, as amended, 29 U.S.C. §701 et seq ., or of the Missouri Human Rights Act, §213.000 R.S. Mo. et seq. , the Missouri Service Letter Statute, §209.140 R.S. Mo., The Massachusetts Fair Employment Practice Act, MGL Ch. 151B, §§ 1-10; the Massachusetts Equal Rights Act, MGL, Ch. 93, § 102; the Wisconsin Fair Employment Act (WFEA), Wis. Stat. §§111.31-111.395, or any other federal, state, or local laws, statutes or ordinances governing or concerning employment (with the exception of the federal Family and Medical Leave Act) the right to recovery in any suit brought by the Equal Employment Opportunity Commission, the Missouri Human Rights Commission, the Massachusetts Human Rights Commission or the Wisconsin Equal Rights Division on behalf of the Employee, or any claims for pay, vacation pay, or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than those payments and benefits specifically provided herein.

d.           This Release shall not affect Employee’s right to any governmental benefits payable under any Social Security, Unemployment Compensation or Worker’s Compensation law now or in the future.

3.            Release of Benefit Claims .  Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, further releases and waives any claims for pay, vacation pay, insurance or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than claims to the payments and benefits specifically provided for in the Severance Agreement

4.            Revocation Period; Knowing and Voluntary Agreement .

 
a.
Time for Consideration and Execution .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that he is entitled to at least twenty-one (21) days within which to consider this Agreement before signing the same, and that Employee has, in fact, been offered at least twenty-one (21) days within which to consider this Agreement before signing the Agreement.  Employee may, however, execute this Agreement sooner than twenty-one (21) days if he so chooses.

 
b.
Time for Revocation .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that this Agreement shall not become effective until the eighth (8th) calendar day after the date of Employee’s execution of this Agreement.  During the seven (7) day period following Employee’s execution of this Agreement, Employee may freely revoke his execution of this Agreement by providing written notification of such revocation to:  _____________________ [name], _____________________ [title], __________________________ [company], ____________________________ [address].  Upon expiration of the seven (7) day period, Employee acknowledges that this Agreement becomes final and binding.  If Employee revokes this Agreement within the seven (7) day period following Employee’s execution of this Agreement, it shall not be effective or enforceable, and Employee will not receive the severance payments and described in the Severance Agreement.

 
c.
Consultation With an Attorney .  By executing this Agreement, Employee acknowledges that, at the time he was presented with this Agreement for consideration, Employee was advised by a representative from Company, in writing, to consult with an attorney about this Agreement, its meaning and effect, before executing this Agreement.

 
d.  
Knowing Release.  Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purposes of making a full and final compromise, adjustment and settlement of all potential claims hereinabove described.

i)  
Employee acknowledges that Employee has been given a period of at least twenty-one (21) days to consider whether to accept this Release.  Furthermore, Employee may revoke this Release for seven (7) days following the execution of this Release.

ii)  
Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purpose of making a full and final compromise, adjustment, and settlement of all potential claims hereinabove described.  Employee hereby acknowledges that Employee has been advised of the opportunity to consult an attorney and that Employee understands the Release and the effect of signing the Release.

 
5.            Severability.   If any provision of this Release or the application thereof to any person or circumstance shall to any extent be held to be invalid or unenforceable, the remainder of this Release and the application of such provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each provision of this Release shall be valid and enforceable to the fullest extent permitted by law.
 
6.            Headings.   The headings in this Release are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Release.
 
7.            Counterparts.   This Release may be executed in one or more identical counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
8.            Entire Agreement.   This Release and the related Severance Agreement constitute the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.
 
9.            Governing Law.   This Release shall be governed by, and construed and enforced in accordance with, the laws of the State of Missouri, without reference to the conflict of laws of such State and the parties agree that any litigation involving this Release, or regarding the interpretation, validity and/or enforceability of this Release, shall be filed and conducted exclusively in the Missouri state court in St. Louis County, Missouri or in the federal court for the Eastern District of Missouri, Eastern Division.
 
IN WITNESS WHEREOF, Employee and the Company have executed this Release as of the day and year first above written.
 
    BROWN SHOE COMPANY, INC.
     
   By:  
     
  EMPLOYEE
     
   By:  
    Jane Doe 
 
 


 
 
 

Exhibit 10.4
 
SEVERANCE AGREEMENT
 
This SEVERANCE AGREEMENT (the “Agreement”) is effective as of April 1, 2006 (“Effective Date”) by and between Richard M. Ausick (“Employee”) and Brown Shoe Company, Inc., a New York corporation (“Brown Shoe” and, together with its subsidiaries, the “Company”).
 
WHEREAS, Brown Shoe is engaged, directly and indirectly through its subsidiaries, in the sourcing and retail and wholesale sale of footwear in the United States and throughout the world;
 
WHEREAS, Employee is employed by Brown Shoe or a wholly-owned subsidiary of Brown Shoe in an executive capacity, possesses intimate knowledge of the business and affairs of the Company, and has acquired, and will continue to acquire, certain confidential, proprietary and trade secret information and data with respect to the Company;
 
WHEREAS,  Employee and Brown Shoe are currently parties to a severance agreement which Employee and Brown Shoe desire to terminate and replace with this Agreement (the “Prior Agreement”);
 
WHEREAS, Brown Shoe desires to insure, insofar as possible, that the Company will continue to have the benefit of Employee’s services and to protect the confidential information and goodwill of the Company; and
 
WHEREAS, the Company recognizes that circumstances may arise in which a change in the control of Brown Shoe occurs, through acquisition or otherwise, thereby causing uncertainty of employment without regard to Employee’s competence or past contributions which uncertainty may result in the loss of valuable services of Employee to the detriment of the Company and Brown Shoe’s shareholders, and the Company and Employee wish to provide reasonable security to Employee against changes in Employee’s relationship with Brown Shoe in the event of any such change in control; and
 
WHEREAS, both the Company and Employee are desirous that a proposal for any change of control or acquisition will be considered by Employee objectively and with reference only to the business interests of the Company and Brown Shoe’s shareholders; and
 
WHEREAS, Employee will be in a better position to consider the best interests of the Company if Employee is afforded reasonable security, as provided in this Agreement, against altered conditions of employment which could result from any such change in control or acquisition.
 
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements hereinafter set forth, the parties hereto mutually covenant and agree as follows:
 
Section 1.   Definitions
 
1.1   “Board” means the Board of Directors of Brown Shoe.
 
1.2   “Business Unit” means any direct or indirect subsidiary, operating division or business unit of Brown Shoe.
 
1.3   “Cause” means (i) engaging by Employee in willful misconduct which is materially injurious to the Company; (ii) conviction of Employee of a felony; (iii) engaging by Employee in fraud, material dishonesty or gross misconduct in connection with the business of the Company; (iv) engaging by Employee in any act of moral turpitude reasonably likely to materially and adversely affect the Company or its business; (v) engaging by Employee in the illegal use of a controlled substance or using prescription medications unlawfully; or (vi) abuse by Employee of alcohol.
 
1.4   “Change of Control” means the occurrence of any of the following events after the Effective Date:
 
(a)   The acquisition by any Person of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either (x) the then outstanding shares of common stock of Brown Shoe (the “Outstanding Company Common Stock”) or (y) the combined voting power of the then outstanding voting securities of Brown Shoe entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this paragraph (a) the following acquisitions shall not constitute a Change of Control:  (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (iv) any acquisition by any corporation pursuant to a transaction which complies with the exception set forth in paragraph (c) below; or
 
(b)   Individuals who, as of the Effective Date of this Agreement, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or
 
(c)   Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another corporation (a “Business Combination”), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 65% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; or
 
(d)   Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.
 
1.5   “Code” means the Internal Revenue Code of 1986, as amended.
 
1.6   “Competitor” means any Person which (a) in its prior fiscal year had annual gross sales volume or revenues of more than $20,000,000 attributable to the sale of footwear or (b) is reasonably expected to have such level of footwear sales or revenues in either the current fiscal year or the next following fiscal year.
 
1.7   “Confidential Information” shall have the meaning set forth in Section 10.
 
1.8   “Customer” means any wholesale customer of Brown Shoe and/or any Business Unit which either purchased from Brown Shoe and/or any Business Unit during the one (1) year immediately preceding the Termination Date, or is reasonably expected by Brown Shoe and/or any Business Unit to purchase from Brown Shoe and/or any Business Unit in the one (1) year period immediately following the Termination Date, more than $1,000,000 in footwear.
 
1.9   “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
 
1.10   “Good Reason,” when used with reference to a voluntary termination by Employee of Employee’s employment with the Company, means (i) a reduction in Employee’s base salary as in effect on the date hereof, or as the same may be increased from time to time; (ii) a reduction in Employee’s status, position, responsibilities or duties; (iii) the required relocation of Employee’s principal place of business, without Employee’s consent, to a location which is more than fifty (50) miles from Employee’s principal place of business on the Effective Date, or from such location to which Employee may transfer with Employee’s consent after the Effective Date; (iv) a material increase in the amount of time Employee is required to travel on behalf of the Company; (v) the failure of any successor of Brown Shoe to assume this Agreement, or (vi) a material breach of this Agreement by the Company.
 
1.11   “Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).
 
1.12   “Termination Date” means the effective date as provided in this Agreement of the termination of Employee’s employment with the Company.
 
Section 2.   Term
 
2.1   Subject to Section 2.2, the term of this Agreement (the “Term”) shall be a period of three (3) years commencing on the Effective Date.
 
2.2   The Term shall be automatically extended for successive one (1) year periods unless either party to this Agreement provides the other party with notice of termination at least ninety (90) days prior to the expiration of the original three-year period or any one-year period thereafter.
 
Section 3.   Termination of Employment
 
3.1   The Company may terminate Employee’s employment at any time for Cause, effective upon written notice to Employee specifying in reasonable detail the particulars of Employee’s conduct deemed by the Company and/or such subsidiary to justify such termination for Cause.
 
3.2   The Company may terminate Employee’s employment without Cause at any time, effective upon written notice to Employee of termination specifying that such termination is without Cause.
 
3.3   Employee may terminate Employee’s employment with the Company at any time, with or without Good Reason.
 
Section 4.   Separation Benefits
 
4.1   If Employee’s employment is terminated by the Company for any reason other than for Cause, death or disability and Section 4.2 does not apply, Employee shall be entitled to the following separation benefits:
 
(a)   The Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not used at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
(b)   The Company shall pay, or cause to be paid, to Employee (i) in a lump sum not later than thirty (30) days after the Termination Date an amount equal to 200% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year, and (ii) Employee’s targeted bonus payment for the year of termination prorated to the Termination Date.
 
(c)   The Company shall provide to Employee for a period of eighteen (18) months after the Termination Date medical and/or dental coverage under the Company’s medical and/or dental plans, without any cost to Employee in excess of any employee contribution that would be payable by Employee if Employee remained employed by a member of the Company; provided, however, that if Employee becomes employed with another employer during such eighteen (18)-month period and is eligible to receive medical and/or dental coverage under another employer-provided plan, the medical and/or dental coverage described herein shall be secondary to those provided under such other plan.  In addition, on the last day of such eighteen (18)-month period, the Company shall pay, or cause to be paid, to Employee an amount in cash equal to the aggregate amount that would be payable by the Company for such medical and/or dental coverage for six (6) months if Employee remained employed by the Company for such period.
 
(d)   The restrictions applicable to each share of non-vested restricted stock of Brown Shoe held by Employee that would have vested within the two (2) year period following the Termination Date had Employee remained employed by the Company shall lapse as of the Termination Date.
 
(e)   Each non-vested option to purchase Brown Shoe stock held by Employee that would have vested within the two (2) year period following the Termination Date had Employee remained employed by the Company shall vest as of the Termination Date.
 
(f)   The Company shall pay the reasonable costs of outplacement services selected by the Company for a reasonable period of time following the Termination Date; provided, however, that no such outplacement services shall be provided after the last day of the second calendar year following the calendar year in which the Termination Date occurs.
 
4.2   If Employee’s employment is terminated within twenty-four (24) months after a Change of Control (x) by the Company for any reason other than for Cause, death or disability, or (y) by Employee within ninety (90) days after the occurrence of Good Reason, Employee shall be entitled to the following separation benefits in place of, and not in addition to, the benefits set forth in Section 4.1:
 
(a)   The Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not taken at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
(b)   The Company shall pay, or cause to be paid, to Employee (i) in a lump sum six (6) months after the Termination Date an amount equal to 300% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year; and (ii) Employee’s targeted bonus payment for the year of termination prorated to the Termination Date.
 
(c)   The Company shall provide to Employee for a period of eighteen (18) months after the Termination Date medical and/or dental coverage under the Company’s medical and dental plans, without any cost to Employee in excess of any employee contribution that would be payable by Employee if Employee remained employed by the Company; provided, however, that if Employee becomes employed with another employer during such eighteen (18)-month period and is eligible to receive medical and/or dental coverage under another employer-provided plan, the medical and/or dental coverage described herein shall be secondary to those provided under such other plan.  In addition, on the last day of such eighteen (18)-month period, the Company shall pay, or cause to be paid, to Employee an amount in cash equal to the aggregate amount that would be payable by the Company for such medical and/or dental coverage for eighteen (18) months if Employee remained employed by the Company for such period.
 
(d)   The restrictions applicable to each share of non-vested restricted stock of Brown Shoe held by Employee shall lapse and be exercisable as of the Termination Date.
 
(e)   Each non-vested option to purchase Brown Shoe stock held by Employee shall vest and be exercisable as of the Termination Date.
 
(f)   For purposes of determining Employee’s benefit under the Company’s Supplemental Employment Retirement Plan, an additional three (3) years of Credited Service shall be credited to Employee’s actual or deemed Credited Service.
 
(g)   The Company shall pay the reasonable costs of outplacement services selected by the Company for a reasonable period of time following the Termination Date; provided, however, that no such outplacement services shall be provided after the last day of the second calendar year following the calendar year in which the Termination Date occurs.
 
4.3   If Employee’s employment is terminated for any reason other than such reasons specified in Sections 4.1 and 4.2, the Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not taken at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
4.4   The benefits set forth in Sections 4.1(c) and 4.2(c) shall run concurrently with any period of continuation coverage to which Employee is entitled under Section 601 of ERISA.  Upon Employee’s re-employment during the period specified in each such Section, to the extent covered by the new employer’s plan, coverage under the Company’s plan shall lapse, subject to any continuation of coverage rights under Section 601 of ERISA.  Employee’s participation in and/or coverage under all other employee benefit plans, programs or arrangements sponsored or maintained by the Company shall cease effective as of the Termination Date except as otherwise provided in such employee benefit plan, program or arrangement.
 
Section 5.   Mitigation or Reduction of Benefits
 
Employee shall not be required to mitigate the amount of any payment provided for in Section 4 by seeking other employment or otherwise.  Except as otherwise specifically set forth herein, the amount of any payment or benefits provided in Section 4 shall not be reduced by any compensation or benefits or other amounts paid to or earned by Employee as the result of employment by another employer after the Termination Date or otherwise.
 
Section 6.   Employee Expenses After Change in Control
 
If Employee’s employment is terminated by the Company within twenty-four (24) months after a Change in Control and there is a dispute with respect to this Agreement, then all Employee’s costs and expenses (including reasonable legal and accounting fees) incurred by Employee (a) to defend the validity of this Agreement, (b) to contest any termination for Cause, (c) to contest any determinations by the Company concerning the amounts payable by or on behalf of the Company under this Agreement, or (d) to otherwise obtain or enforce any right or benefit provided to Employee by this Agreement, shall be paid by the Company to the extent Employee is the prevailing party with respect to such claim.  Any such payments shall be paid no later than two and one-half months following the close of the calendar year in which any such dispute is final.
 
Section 7.   Release
 
Notwithstanding anything to the contrary stated in this Agreement, no benefits will be paid pursuant to Section 4 except under Section 4.1(a), 4.2(a) or 4.3 prior to execution by Employee of a release of the Company substantially in the form attached as Exhibit A , with such changes as may be made by the Company in its sole discretion in order to comply with and stay current with applicable laws and regulations.
 
Section 8.   Certain Additional Payments
 
8.1   Notwithstanding anything to the contrary contained herein and except as set forth below, in the event it shall be determined that any payment or distribution by or on behalf of the Company to or for the benefit of Employee (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 8) (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by Employee with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then Employee shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by Employee of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.  Notwithstanding the foregoing provisions of this Section 8.1, if it shall be determined that Employee is entitled to a Gross-Up Payment, but that the Payments do not exceed 110% of the greatest amount (the “Reduced Amount”) that could be paid to Employee such that the receipt of Payments will not give rise to any Excise Tax, then no Gross-Up Payment shall be made to Employee and the Payments, in the aggregate, shall be reduced to the Reduced Amount.
 
8.2   Subject to the provisions of Section 8.3, all determinations required to be made under this Section 8, including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by Ernst & Young LLP or such other certified public accounting firm, human resources consulting firm, or other consulting firm in the business of performing such calculations as may be designated by Employee with the consent of the Company, which consent shall not be unreasonably withheld (the “Consulting Firm”), which shall provide detailed supporting calculations both to the Company and Employee within fifteen (15) business days of the receipt of notice from Employee that there has been a Payment, or such earlier time as is requested by the Company.  In the event that the Consulting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change of Control, Employee, with the consent of the Company, which consent shall not be unreasonably withheld, shall appoint another nationally recognized accounting firm, human resources consulting firm, or other consulting firm in the business of performing such calculations to make the determinations required hereunder (which such firm shall then be referred to as the Consulting Firm hereunder).  All fees and expenses of the Consulting Firm shall be borne solely by the Company.  Any Gross- Up Payment, as determined pursuant to this Section 8, shall be paid by the Company to Employee no later than two and one-half months following the Termination Date.  Any determination by the Consulting Firm shall be binding upon the Company and Employee.  As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Consulting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (“Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to Section 8.3 and Employee thereafter is required to make a payment of any Excise Tax, the Consulting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of Employee within two and one-half months after the date the Company exhausts such remedies.
 
8.3   Employee shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after Employee is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid.  Employee shall not pay such claim prior to the expiration of the thirty (30)-day period following the date on which Employee gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due).  If the Company notifies Employee in writing prior to the expiration of such period that it desires to contest such claim, Employee shall:
 
(a)   give the Company any information reasonably requested by the Company relating to such claim;
 
(b)   take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;
 
(c)   cooperate with the Company in good faith in order to effectively contest such claim; and
 
(d)   permit the Company to participate in any proceedings relating to such claim;
 
provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Employee harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.  Without limitation on the foregoing provisions of this Section 8.3, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Employee to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Employee agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Employee to pay such claim and sue for a refund, the Company shall advance the amount of such payment to Employee, on an interest-free basis and shall indemnify and hold Employee harmless, on an after tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of Employee with respect to which such contested amount is claimed to be due is limited solely to such contested amount.  Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Employee shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.
 
8.4   If, after the receipt by Employee of an amount advanced by the Company pursuant to Section 8.3, Employee becomes entitled to receive any refund with respect to such claim, Employee shall (subject to the Company’s complying with the requirements of Section 8.3) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto).  If, after the receipt by Employee of an amount advanced by the Company pursuant to Section 8.3, a determination is made that Employee shall not be entitled to any refund with respect to such claim and the Company does not notify Employee in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.
 
Section 9.   Covenant Not to Compete
 
9.1   During Employee’s employment with Brown Shoe and/or any Business Unit and for a period of two (2) years after the Termination Date (collectively, the “Restricted Period”), Employee will not, directly or indirectly, on Employee’s own behalf or on behalf of any other Person (whether as owner, partner, consultant, employee or otherwise):
 
(a)   provide any executive, managerial, supervisory, and/or consulting services with respect to the footwear industry and/or the footwear business in the United States for any Competitor;
 
(b)   hold any executive, managerial and/or supervisory position with any Competitor in the United States;
 
(c)   assist any Competitor in competing against Brown Shoe and/or any Business Unit for which Employee performs or performed substantial work and/or has or had access to Confidential Information (each a “Relevant Business Unit”) (i) in the United States and/or (ii) in any other country in which Brown Shoe and/or any Relevant Business Unit is doing business in the one year immediately preceding the Termination Date (each a “Foreign Country”) if Employee had access to Confidential Information regarding the Company’s business in such Foreign Country;
 
(d)   engage in any research, development and/or planning activities or efforts for a Competitor, whether as an employee, consultant, independent contractor or otherwise, to assist the Competitor in competing (i) in the footwear industry in the United States or (ii) in any Foreign Country if Employee had access to Confidential Information regarding the Company’s business in such Foreign Country;
 
(e)   cause or attempt to cause any Customer to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(f)   assist any Competitor in connection with any plan, effort, activity or undertaking to cause or attempt to cause any Customer to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(g)   cause or attempt to cause any footwear supplier or manufacturer of Brown Shoe and/or any Relevant Business Unit to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(h)   assist any Competitor in connection with any plan, effort, activity or undertaking to cause or attempt to cause any footwear supplier or manufacturer of Brown Shoe and/or any Relevant Business Unit to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit; and/or
 
(i)   solicit, entice, employ or seek to employ, in the footwear industry, any executive, managerial and/or supervisory employee of, or any consultant or advisor to, Brown Shoe and/or any Relevant Business Unit.
 
9.2   Employee recognizes and agrees that the restraints contained in Section 9.1 are reasonable and should be fully enforceable in view of, among other things, the high level positions Employee has had with Brown Shoe and/or any Relevant Business Unit(s), the national and international nature of both the Company’s collective business and competition in the footwear industry, and the legitimate interests of the Company in protecting its confidential, proprietary and trade secret information (“Confidential Information”) and their respective customer goodwill and relationships.  Employee specifically hereby acknowledges and confirms that Employee is willing and intends to, and will, abide fully by the terms of Section 9.1.  Employee further agrees that the Company would not have adequate protection if Employee were permitted to work for its competitors in violation of the terms of this Agreement since the Company would, among other things, be unable to verify whether (i) its Confidential Information was being disclosed and/or misused, and/or (ii) Employee was involved in diverting or helping to divert the Company’s customers and/or customer goodwill.
 
9.3   Employee agrees to disclose, during the Restricted Period, the terms of this Section 9 to any potential future employer.
 
Section 10.   Confidential Information.
 
10.1   Employee acknowledges and agrees that during Employee’s employment, Employee has been and/or will be provided and have access to certain Confidential Information of the Company.  Employee agrees to keep secret and confidential, and not to use or disclose to any third-parties, except as directly required for Employee to perform Employee's employment responsibilities for the Company, any of the Company’s Confidential Information.
 
10.2   Confidential Information includes all confidential and/or trade secret information of the Company (regardless of the form or medium in which it may exist or be stored or preserved) and includes, but is not limited to, all such information containing or reflecting any:
 
(a)   lists or other identification of customers or prospective customers of Brown Shoe and/or any Relevant Business Unit (and/or key individuals employed or engaged by such parties);
 
(b)   lists or other identification of sources or prospective sources of Brown Shoe’s and/or any Relevant Business Unit’s products or components thereof (and/or key individuals employed or engaged by such parties);
 
(c)   compilations, information, designs, drawings, files, formulae, lists, machines, maps, methods, models, notes or other writings, plans, records, regulatory compliance procedures, reports, specialized or technical data, schematics, source code, object code, documentation, and software relating to the development, manufacture, fabrication, assembly, marketing and/or sale of Brown Shoe’s and/or any Relevant Business Unit’s products;
 
(d)   financial, distribution, sales and marketing information, data, plans, and/or strategies of Brown Shoe and/or any Relevant Business Unit;
 
(e)   equipment, materials, procedures, processes, and techniques used in, or related to, the development, manufacture, assembly, fabrication or other production and quality control of the Brown Shoe’s and/or any Relevant Business Unit’s products and services;
 
(f)   Brown Shoe’s and/or any Relevant Business Unit’s relations and/or dealings with its customers, prospective customers, suppliers and prospective suppliers and the nature and type of products or services rendered to such customers (or proposed to be rendered to prospective customers);
 
(g)   Brown Shoe’s and/or any Relevant Business Unit’s relations with its employees (including, without limitation, salaries, job classifications and skill levels); and
 
(h)   any other information designated by Brown Shoe and/or any Relevant Business Unit to be confidential, secret and/or proprietary (including without limitation, information provided by customers or suppliers of Brown Shoe and/or any Relevant Business Unit).
 
Notwithstanding the foregoing, the term “Confidential Information” shall not consist of any data or other information which has been made publicly available or otherwise placed in the public domain other than by Employee in violation of this Agreement.
 
10.3   Employee will not, directly or indirectly, copy, reproduce or otherwise duplicate, record, abstract, summarize or otherwise use for Employee or use for, or disclose to, any party other than Brown Shoe, or any subsidiary or affiliate of Brown Shoe, any Confidential Information, without Brown Shoe’s prior written permission or except as required for the proper performance of Employee’s duties on behalf of the Company.
 
10.4   Employee understands that Confidential Information may or may not be labeled as “confidential” and will treat all information as confidential unless otherwise informed by Brown Shoe.
 
10.5   At the termination of Employee’s employment with the Company or at any other time Brown Shoe or any subsidiary or affiliate thereof may request, Employee shall promptly deliver to Brown Shoe all documents and other materials, whether in physical or electronic form (including all copies thereof), containing any Confidential Information.
 
Section 11.   Injunctive Relief
 
In the event of a breach or threatened breach of any of Employee’s duties or obligations under the terms and provisions of Section 9, Section 10, Section 12.2 or Section 12.9, the Company shall be entitled, in addition to any other legal or equitable remedies it may have in connection therewith (including any right to damages that it may suffer), to temporary, preliminary and permanent injunctive relief restraining such breach or threatened breach.  Employee hereby expressly acknowledges that the harm that might result to the Company’s business as a result of noncompliance by Employee with any of the provisions of Section 9, Section 10, Section 12.2 or Section 12.9 would be largely irreparable.  Employee specifically agrees that if there is a question as to the enforceability of any of the provisions of Section 9, Section 10, Section 12.2 or Section 12.9, Employee will not engage in any conduct inconsistent with or contrary to such Sections until after the question has been resolved by a final judgment of a court of competent jurisdiction.  Employee undertakes and agrees that if Employee breaches or threatens to breach the Agreement, Employee shall be liable for any attorneys’ fees and costs incurred by the Company in enforcing its rights hereunder.
 
Section 12.   Miscellaneous
 
12.1   Notice .  All notices hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered personally or by courier, or (b) when received by facsimile (including electronic mail), receipt confirmed, or (c) on the third business day following the mailing thereof by registered or certified mail, postage prepaid, or (d) on the first business day following the mailing thereof by overnight delivery service, in each case addressed as set forth below:
 
If to the Company:
 
Brown Shoe Company, Inc.
8300 Maryland Avenue
St. Louis, Missouri  63166-0029
Attention:  General Counsel
 
If to Employee:
 
Richard M. Ausick
1905 Waterbend Drive
Verona, WI  53593
 
Any party may change the address to which notices are to be addressed by giving the other party written notice in the manner herein set forth.
 
12.2   Successors; Binding Agreement .
 
(a)   Brown Shoe shall require any successor to all or substantially all of the business and/or assets of the Company (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise), prior to or upon such succession, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  Failure of Brown Shoe to obtain such agreement upon or prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Employee to benefits from the Company in the same amounts and on the same terms as Employee would be entitled hereunder if Employee’s employment was terminated without Cause within twenty-four (24) months after a Change of Control.  For purposes of the preceding sentence, the date on which any such succession becomes effective shall be deemed the Termination Date.
 
(b)   Brown Shoe shall also have the right, but not the obligation, to assign this Agreement, without Employee’s consent, to any successor to all or substantially all of the business and/or assets of a Business Unit for which Employee performs substantially all of Employee’s duties (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise).  In the event, and only in the event, Brown Shoe elects to assign this Agreement to such successor of a Business Unit, a Change of Control will be deemed to have occurred and Brown Shoe shall require such successor to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  No Change of Control shall be deemed to have occurred if Brown Shoe does not elect to assign this Agreement to such successor of a Business Unit.
 
(c)   This Agreement is personal to Employee and Employee may not assign or delegate any part of Employee’s rights or duties hereunder to any other person, except that this Agreement shall inure to the benefit of and be enforceable by Employee’s legal representatives, executors, administrators, heirs and beneficiaries.
 
12.3   Judicial Modification .  If and to the extent that any Section, term and/or provision of this Agreement is determined by a court of competent jurisdiction to be unenforceable under applicable law, then such Section(s), term(s) and/or provision(s) shall not be void but instead shall be modified and, to the maximum extent permissible under applicable law, enforced.
 
12.4   Headings .  The headings in this Agreement are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Agreement.
 
12.5   Counterparts .  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
12.6   Waiver .  Neither any course of dealing nor any failure or neglect of either party hereto in any instance to exercise any right, power or privilege hereunder or under law shall constitute a waiver of such right, power or privilege or of any other right, power or privilege or of the same right, power or privilege in any other instance.  Without limiting the generality of the foregoing, Employee’s continued employment without objection shall not constitute Employee’s consent to, or a waiver of Employee’s rights with respect to, any circumstances constituting Good Reason.  All waivers by either party hereto must be contained in a written instrument signed by the party to be charged therewith, and, in the case of the Company, by its duly authorized officer.
 
12.7   Entire Agreement; Termination of Prior Agreement .  This instrument constitutes the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.  The Prior Agreement is hereby terminated and deemed by the parties to be void ab initio .
 
12.8   Amendment .  Subject to Section 12.3, no modification, amendment or waiver of any of the provisions of this Agreement shall be effective unless in writing specifically referring hereto, and signed by the parties hereto.
 
12.9   Governing Law .  In light of Company’s and Employee’s substantial contacts with the State of Missouri, the facts that the Company is headquartered in Missouri and Employee resides in and/or reports to Company management in Missouri, the parties’ interests in ensuring that disputes regarding the interpretation, validity and enforceability of this Agreement are resolved on a uniform basis, and Brown Shoe’s execution of, and the making of, this Agreement in Missouri, the parties agree that:  (i) any litigation involving any noncompliance with or breach of the Agreement, or regarding the interpretation, validity and/or enforceability of the Agreement, shall be filed and conducted exclusively in the state courts in St. Louis County, Missouri, or the U.S. District Court for the Eastern District of Missouri; and (ii) this Agreement shall be interpreted in accordance with and governed by the laws of the State of Missouri, without regard for any conflict of law principles.  Employee agrees that Employee under no circumstances will, either alone or in conjunction with anyone else, file or pursue any such litigation other than in such state or federal courts in Missouri, and Employee hereby consents and agrees that any such litigation filed in any other court(s) shall be dismissed and that Employee may be enjoined from filing and/or pursuing any such action.
 
12.10   Third Party Beneficiaries .  Employee agrees that Brown Shoe’s subsidiaries are third party beneficiaries of this Agreement and hereby consents to the enforcement by any subsidiary of Brown Shoe of the provisions contained herein, including without limitation, the provisions of Section 9 and Section 10.
 
IN WITNESS WHEREOF, Employee and Brown Shoe have executed this Agreement as of the day and year first above written.
 
Brown Shoe Company, Inc.
 
 
Employee
 
By:
  /s/ Douglas W. Koch     /s/ Richard M. Ausick
Name:
Douglas W. Koch
 
Richard M. Ausick
Title:
Senior Vice President and
 Chief Talent Officer
   
Date:
  4/6/06  
Date:
  3/29/06

 

 
 
 


Exhibit A

RELEASE


THIS RELEASE (the “Release”) dated _____________ between Jane Doe (“Employee”) and Brown Shoe Company, Inc., a New York corporation;

WHEREAS, the Company and Employee are parties to a Severance Agreement dated _____________, 200___ and effective as of ______________, 200__ (the “Severance Agreement”);

WHEREAS, the execution of this Release is a condition precedent to, and material inducement to, the Company’s provision of certain benefits under the Severance Agreement;

NOW, THEREFORE, the parties hereto agree as follows:

1.            Mutual Promises.   The Company undertakes the obligations contained in the Severance Agreement, which are in addition to any compensation to which Employee might otherwise be entitled, in exchange for Employee’s promises and obligations contained herein and in the Severance Agreement. The Company’s obligations are undertaken in lieu of any other severance benefits.

2.            Releases of Claims; Agreements Not to File Suit .

a.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, agrees to, and does, remise, release and forever discharge the Company and its subsidiaries and affiliates, each of their shareholders, directors, officers, employees, agents and representatives, and its successors and assigns (collectively, the “Company Released Persons”), from any and all matters, claims, demands, damages, causes of action, debts, liabilities, controversies, judgments and suits of every kind and nature whatsoever, foreseen or unforeseen, known or unknown, which have arisen or could arise from matters which occurred prior to the date of this Release, which matters include without limitation: (i) the matters covered by the Severance Agreement and this Release, (ii) Employee’s employment, and/or termination from employment with the Company, and (iii) any claims which might otherwise arise in the future as a result of arrangements or agreements in effect as of the date of this Release or the continuance of such arrangements and agreements; provided, however, that this Section 2(a) shall not apply to any claims to the payments and benefits specifically provided for in the Severance Agreement or, subject to the terms of the Severance Agreement, the payments or benefits to which Employee, by reason of the termination of Employee’s employment, may be entitled under any employee benefit plan (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974) other than a severance pay plan.

b.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns, and anyone claiming through or under any of the foregoing, agrees that she will not file or otherwise submit any charge, claim, complaint, or action to any agency, court, organization, or judicial forum (nor will Employee permit any person, group of persons, or organization to take such action on Employee’s behalf) against any Company Released Person arising out of any actions or non-actions on the part of any Company Released Person arising before the date of this Release or any action taken after the date of this Release pursuant to the Severance Agreement.  Employee further agrees that in the event that any person or entity should bring such a charge, claim, complaint, or action on Employee’s behalf, Employee hereby waives and forfeits any right to recovery under said claim and will exercise every good faith effort to have such claim dismissed.

c.           The charges, claims, complaints, matters, demands, damages, and causes of action referenced in Sections 2(a) and 2(b) include, but are not limited to: (i) any claim for breach of an actual or implied contract (whether written or oral) of employment between Employee and any Company Released Person (including, but not limited to, any claim of fraud, promissory fraud, promissory estoppel, fraudulent misrepresentation or negligent misrepresentation in the making of any actual or implied contract of employment), (ii) any claim of unjust, wrongful, discriminatory, retaliatory or tortious discharge or other adverse employment action (including any claim of whistleblowing), (iii) any claim of slander, libel or other similar action for defamation, (iv) any claim of intentional tort (including assault, battery, conversion and/or intentional infliction of emotional distress), (v) any claim of negligence (including negligent infliction of emotional distress, negligent supervision, negligent hiring, or negligent retention), (vi) any claim of a violation of a law, statute or ordinance, including, but not limited to, the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq ., the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq . , the Americans with Disabilities Act of 1990, 42 U.S.C. §12101 et seq., the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §201 et seq ., the Rehabilitation Act of 1973, as amended, 29 U.S.C. §701 et seq ., or of the Missouri Human Rights Act, §213.000 R.S. Mo. et seq. , the Missouri Service Letter Statute, §209.140 R.S. Mo., The Massachusetts Fair Employment Practice Act, MGL Ch. 151B, §§ 1-10; the Massachusetts Equal Rights Act, MGL, Ch. 93, § 102; the Wisconsin Fair Employment Act (WFEA), Wis. Stat. §§111.31-111.395, or any other federal, state, or local laws, statutes or ordinances governing or concerning employment (with the exception of the federal Family and Medical Leave Act) the right to recovery in any suit brought by the Equal Employment Opportunity Commission, the Missouri Human Rights Commission, the Massachusetts Human Rights Commission or the Wisconsin Equal Rights Division on behalf of the Employee, or any claims for pay, vacation pay, or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than those payments and benefits specifically provided herein.

d.           This Release shall not affect Employee’s right to any governmental benefits payable under any Social Security, Unemployment Compensation or Worker’s Compensation law now or in the future.

3.            Release of Benefit Claims .  Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, further releases and waives any claims for pay, vacation pay, insurance or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than claims to the payments and benefits specifically provided for in the Severance Agreement

4.            Revocation Period; Knowing and Voluntary Agreement .

 
a.
Time for Consideration and Execution .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that he is entitled to at least twenty-one (21) days within which to consider this Agreement before signing the same, and that Employee has, in fact, been offered at least twenty-one (21) days within which to consider this Agreement before signing the Agreement.  Employee may, however, execute this Agreement sooner than twenty-one (21) days if he so chooses.

 
b.
Time for Revocation .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that this Agreement shall not become effective until the eighth (8th) calendar day after the date of Employee’s execution of this Agreement.  During the seven (7) day period following Employee’s execution of this Agreement, Employee may freely revoke his execution of this Agreement by providing written notification of such revocation to:  _____________________ [name], _____________________ [title], __________________________ [company], ____________________________ [address].  Upon expiration of the seven (7) day period, Employee acknowledges that this Agreement becomes final and binding.  If Employee revokes this Agreement within the seven (7) day period following Employee’s execution of this Agreement, it shall not be effective or enforceable, and Employee will not receive the severance payments and described in the Severance Agreement.

 
c.
Consultation With an Attorney .  By executing this Agreement, Employee acknowledges that, at the time he was presented with this Agreement for consideration, Employee was advised by a representative from Company, in writing, to consult with an attorney about this Agreement, its meaning and effect, before executing this Agreement.

 
d.  
Knowing Release.  Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purposes of making a full and final compromise, adjustment and settlement of all potential claims hereinabove described.

i)  
Employee acknowledges that Employee has been given a period of at least twenty-one (21) days to consider whether to accept this Release.  Furthermore, Employee may revoke this Release for seven (7) days following the execution of this Release.

ii)  
Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purpose of making a full and final compromise, adjustment, and settlement of all potential claims hereinabove described.  Employee hereby acknowledges that Employee has been advised of the opportunity to consult an attorney and that Employee understands the Release and the effect of signing the Release.

 
5.            Severability.   If any provision of this Release or the application thereof to any person or circumstance shall to any extent be held to be invalid or unenforceable, the remainder of this Release and the application of such provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each provision of this Release shall be valid and enforceable to the fullest extent permitted by law.
 
6.            Headings.   The headings in this Release are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Release.
 
7.            Counterparts.   This Release may be executed in one or more identical counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
8.            Entire Agreement.   This Release and the related Severance Agreement constitute the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.
 
9.            Governing Law.   This Release shall be governed by, and construed and enforced in accordance with, the laws of the State of Missouri, without reference to the conflict of laws of such State and the parties agree that any litigation involving this Release, or regarding the interpretation, validity and/or enforceability of this Release, shall be filed and conducted exclusively in the Missouri state court in St. Louis County, Missouri or in the federal court for the Eastern District of Missouri, Eastern Division.
 
IN WITNESS WHEREOF, Employee and the Company have executed this Release as of the day and year first above written.
 
    BROWN SHOE COMPANY, INC.
     
   By:  
     
  EMPLOYEE
     
   By:  
    Jane Doe 
 
 


 
 
 


 
 
 
Exhibit 10.5
SEVERANCE AGREEMENT
 
This SEVERANCE AGREEMENT (the “Agreement”) is effective as of April 1, 2009 (“Effective Date”) by and between Mark D. Lardie (“Employee”) and Brown Shoe Company, Inc., a New York corporation (“Brown Shoe” and, together with its subsidiaries, the “Company”).
 
WHEREAS, Brown Shoe is engaged, directly and indirectly through its subsidiaries, in the sourcing and retail and wholesale sale of footwear in the United States and throughout the world;
 
WHEREAS, Employee is employed by Brown Shoe or a wholly-owned subsidiary of Brown Shoe in an executive capacity, possesses intimate knowledge of the business and affairs of the Company, and has acquired, and will continue to acquire, certain confidential, proprietary and trade secret information and data with respect to the Company;
 
WHEREAS, Brown Shoe desires to insure, insofar as possible, that the Company will continue to have the benefit of Employee’s services and to protect the confidential information and goodwill of the Company; and
 
WHEREAS, the Company recognizes that circumstances may arise in which a change in the control of Brown Shoe occurs, through acquisition or otherwise, thereby causing uncertainty of employment without regard to Employee’s competence or past contributions which uncertainty may result in the loss of valuable services of Employee to the detriment of the Company and Brown Shoe’s shareholders, and the Company and Employee wish to provide reasonable security to Employee against changes in Employee’s relationship with Brown Shoe in the event of any such change in control; and
 
WHEREAS, both the Company and Employee are desirous that a proposal for any change of control or acquisition will be considered by Employee objectively and with reference only to the business interests of the Company and Brown Shoe’s shareholders; and
 
WHEREAS, Employee will be in a better position to consider the best interests of the Company if Employee is afforded reasonable security, as provided in this Agreement, against altered conditions of employment which could result from any such change in control or acquisition.
 
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements hereinafter set forth, the parties hereto mutually covenant and agree as follows:
 
Section 1.   Definitions
 
1.1   “Board” means the Board of Directors of Brown Shoe.
 
1.2   “Business Unit” means any direct or indirect subsidiary, operating division or business unit of Brown Shoe.
 
1.3   “Cause” means (i) engaging by Employee in willful misconduct which is materially injurious to the Company; (ii) conviction of Employee of a felony; (iii) engaging by Employee in fraud, material dishonesty or gross misconduct in connection with the business of the Company; (iv) engaging by Employee in any act of moral turpitude reasonably likely to materially and adversely affect the Company or its business; (v) engaging by Employee in the illegal use of a controlled substance or using prescription medications unlawfully; or (vi) abuse by Employee of alcohol.
 
1.4   “Change of Control” means the occurrence of any of the following events after the Effective Date:
 
(a)   The acquisition by any Person of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either (x) the then outstanding shares of common stock of Brown Shoe (the “Outstanding Company Common Stock”) or (y) the combined voting power of the then outstanding voting securities of Brown Shoe entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this paragraph (a) the following acquisitions shall not constitute a Change of Control:  (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, or (iv) any acquisition by any corporation pursuant to a transaction which complies with the exception set forth in paragraph (c) below; or
 
(b)   Individuals who, as of the Effective Date of this Agreement, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or
 
(c)   Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another corporation (a “Business Combination”), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 65% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; or
 
(d)   Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.
 
1.5   “Code” means the Internal Revenue Code of 1986, as amended.
 
1.6   “Competitor” means any Person which (a) in its prior fiscal year had annual gross sales volume or revenues of more than $20,000,000 attributable to the sale of footwear or (b) is reasonably expected to have such level of footwear sales or revenues in either the current fiscal year or the next following fiscal year.
 
1.7   “Confidential Information” shall have the meaning set forth in Section 10.
 
1.8   “Customer” means any wholesale customer of Brown Shoe and/or any Business Unit which either purchased from Brown Shoe and/or any Business Unit during the one (1) year immediately preceding the Termination Date, or is reasonably expected by Brown Shoe and/or any Business Unit to purchase from Brown Shoe and/or any Business Unit in the one (1) year period immediately following the Termination Date, more than $1,000,000 in footwear.
 
1.9   “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
 
1.10   “Good Reason,” when used with reference to a voluntary termination by Employee of Employee’s employment with the Company, means (i) a reduction in Employee’s base salary as in effect on the date hereof, or as the same may be increased from time to time; (ii) a reduction in Employee’s status, position, responsibilities or duties; (iii) the required relocation of Employee’s principal place of business, without Employee’s consent, to a location which is more than fifty (50) miles from Employee’s principal place of business on the Effective Date, or from such location to which Employee may transfer with Employee’s consent after the Effective Date; (iv) a material increase in the amount of time Employee is required to travel on behalf of the Company; (v) the failure of any successor of Brown Shoe to assume this Agreement, or (vi) a material breach of this Agreement by the Company.
 
1.11   “Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)).
 
1.12   “Termination Date” means the effective date as provided in this Agreement of the termination of Employee’s employment with the Company.
 
Section 2.   Term
 
2.1   Subject to Section 2.2, the term of this Agreement (the “Term”) shall be a period of one (1) year commencing on the Effective Date.
 
2.2   The Term shall be automatically extended for successive one (1) year periods unless either party to this Agreement provides the other party with notice of termination at least ninety (90) days prior to the expiration of any one-year period thereafter.
 
Section 3.   Termination of Employment
 
3.1   The Company may terminate Employee’s employment at any time for Cause, effective upon written notice to Employee specifying in reasonable detail the particulars of Employee’s conduct deemed by the Company and/or such subsidiary to justify such termination for Cause.
 
3.2   The Company may terminate Employee’s employment without Cause at any time, effective upon written notice to Employee of termination specifying that such termination is without Cause.
 
3.3   Employee may terminate Employee’s employment with the Company at any time, with or without Good Reason.
 
Section 4.   Separation Benefits
 
4.1   If Employee’s employment is terminated by the Company for any reason other than for Cause, death or disability and Section 4.2 does not apply, Employee shall be entitled to the following separation benefits:
 
(a)   The Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not used at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
(b)   The Company shall pay, or cause to be paid, to Employee (i) in a lump sum not later than thirty (30) days after the Termination Date an amount equal to 100% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year, and (ii) Employee’s targeted bonus payment for the year of termination prorated to the Termination Date.
 
(c)   The Company shall provide to Employee for a period of twelve (12) months after the Termination Date medical and/or dental coverage under the Company’s medical and/or dental plans, without any cost to Employee in excess of any employee contribution that would be payable by Employee if Employee remained employed by a member of the Company; provided, however, that if Employee becomes employed with another employer during such twelve (12)-month period and is eligible to receive medical and/or dental coverage under another employer-provided plan, the medical and/or dental coverage described herein shall be secondary to those provided under such other plan.
 
(d)   The restrictions applicable to each share of non-vested restricted stock of Brown Shoe held by Employee that would have vested within the two (2) year period following the Termination Date had Employee remained employed by the Company shall lapse as of the Termination Date.
 
(e)   Each non-vested option to purchase Brown Shoe stock held by Employee that would have vested within the two (2) year period following the Termination Date had Employee remained employed by the Company shall vest as of the Termination Date.
 
(f)   The Company shall pay the reasonable costs of outplacement services selected by the Company for a reasonable period of time following the Termination Date; provided, however, that no such outplacement services shall be provided after the last day of the second calendar year following the calendar year in which the Termination Date occurs.
 
4.2   If Employee’s employment is terminated within twenty-four (24) months after a Change of Control (x) by the Company for any reason other than for Cause, death or disability, or (y) by Employee within ninety (90) days after the occurrence of Good Reason, Employee shall be entitled to the following separation benefits in place of, and not in addition to, the benefits set forth in Section 4.1:
 
(a)   The Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not taken at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
(b)   The Company shall pay, or cause to be paid, to Employee (i) in a lump sum six (6) months after the Termination Date an amount equal to 200% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year; and (ii) Employee’s targeted bonus payment for the year of termination prorated to the Termination Date.
 
(c)   The Company shall provide to Employee for a period of eighteen (18) months after the Termination Date medical and/or dental coverage under the Company’s medical and dental plans, without any cost to Employee in excess of any employee contribution that would be payable by Employee if Employee remained employed by the Company; provided, however, that if Employee becomes employed with another employer during such eighteen (18)-month period and is eligible to receive medical and/or dental coverage under another employer-provided plan, the medical and/or dental coverage described herein shall be secondary to those provided under such other plan.  In addition, on the last day of such eighteen (18)-month period, the Company shall pay, or cause to be paid, to Employee an amount in cash equal to the aggregate amount that would be payable by the Company for such medical and/or dental coverage for six (6) months if Employee remained employed by the Company for such period.
 
(d)   The restrictions applicable to each share of non-vested restricted stock of Brown Shoe held by Employee shall lapse and be exercisable as of the Termination Date.
 
(e)   Each non-vested option to purchase Brown Shoe stock held by Employee shall vest and be exercisable as of the Termination Date.
 
(f)   For purposes of determining Employee’s benefit under the Company’s Supplemental Employment Retirement Plan, an additional two (2) years of Credited Service shall be credited to Employee’s actual or deemed Credited Service.
 
(g)   The Company shall pay the reasonable costs of outplacement services selected by the Company for a reasonable period of time following the Termination Date; provided, however, that no such outplacement services shall be provided after the last day of the second calendar year following the calendar year in which the Termination Date occurs.
 
4.3   If Employee’s employment is terminated for any reason including, but not limited to, Employee’s voluntary termination of employment, but excluding the reasons specified in Sections 4.1 and 4.2, the Company shall pay, or cause to be paid, to Employee within 30 days of the Termination Date (i) the full base salary earned by Employee through, but unpaid at, the Termination Date, plus (ii) credit for any vacation earned by Employee but not taken at the Termination Date, plus (iii) all other amounts owed by the Company to Employee (other than any bonus payment of any kind) but unpaid as of the Termination Date.
 
4.4   The benefits set forth in Sections 4.1(c) and 4.2(c) shall run concurrently with any period of continuation coverage to which Employee is entitled under Section 601 of ERISA.  Upon Employee’s re-employment during the period specified in each such Section, to the extent covered by the new employer’s plan, coverage under the Company’s plan shall lapse, subject to any continuation of coverage rights under Section 601 of ERISA.  Employee’s participation in and/or coverage under all other employee benefit plans, programs or arrangements sponsored or maintained by the Company shall cease effective as of the Termination Date except as otherwise provided in such employee benefit plan, program or arrangement.
 
Section 5.   Mitigation or Reduction of Benefits
 
Employee shall not be required to mitigate the amount of any payment provided for in Section 4 by seeking other employment or otherwise.  Except as otherwise specifically set forth herein, the amount of any payment or benefits provided in Section 4 shall not be reduced by any compensation or benefits or other amounts paid to or earned by Employee as the result of employment by another employer after the Termination Date or otherwise.
 
Section 6.   Employee Expenses After Change in Control
 
If Employee’s employment is terminated by the Company within twenty-four (24) months after a Change in Control and there is a dispute with respect to this Agreement, then all Employee’s costs and expenses (including reasonable legal and accounting fees) incurred by Employee (a) to defend the validity of this Agreement, (b) to contest any termination for Cause, (c) to contest any determinations by the Company concerning the amounts payable by or on behalf of the Company under this Agreement, or (d) to otherwise obtain or enforce any right or benefit provided to Employee by this Agreement, shall be paid by the Company.  The Company shall make payment of such reimbursements from time to time, but in no event later than the last day of the calendar year following the calendar year in which such expenses are incurred, provided Employee timely submits reasonable document of such expenses.  If the event Employee is not the prevailing party in any such contest, Employee shall pay back any reimbursements made by the Company hereunder within 30 days of final disposition of such contest.
 
Section 7.   Release
 
Notwithstanding anything to the contrary stated in this Agreement, no benefits will be paid pursuant to Section 4 except under Section 4.1(a), 4.2(a) or 4.3 prior to execution by Employee of a release of the Company substantially in the form attached as Exhibit A , with such changes as may be made by the Company in its sole discretion in order to comply with and stay current with applicable laws and regulations.  Unless Employee executes such release and returns it to the Company within forty-five (45) days of his termination of employment, all benefits except under Section 4.1(a), 4.2(a) and 4.3 shall be forfeited.
 
Section 8.   Certain Additional Payments
 
8.1   Notwithstanding anything to the contrary contained herein and except as set forth below, in the event it shall be determined that any payment or distribution by or on behalf of the Company to or for the benefit of Employee (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 8) (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are incurred by Employee with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then Employee shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by Employee of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.  Notwithstanding the foregoing provisions of this Section 8.1, if it shall be determined that Employee is entitled to a Gross-Up Payment, but that the Payments do not exceed 110% of the greatest amount (the “Reduced Amount”) that could be paid to Employee such that the receipt of Payments will not give rise to any Excise Tax, then no Gross-Up Payment shall be made to Employee and the Payments, in the aggregate, shall be reduced to the Reduced Amount.
 
8.2   Subject to the provisions of Section 8.3, all determinations required to be made under this Section 8, including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by Ernst & Young LLP or such other certified public accounting firm, human resources consulting firm, or other consulting firm in the business of performing such calculations as may be designated by Employee with the consent of the Company, which consent shall not be unreasonably withheld (the “Consulting Firm”), which shall provide detailed supporting calculations both to the Company and Employee within fifteen (15) business days of the receipt of notice from Employee that there has been a Payment, or such earlier time as is requested by the Company.  In the event that the Consulting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change of Control, Employee, with the consent of the Company, which consent shall not be unreasonably withheld, shall appoint another nationally recognized accounting firm, human resources consulting firm, or other consulting firm in the business of performing such calculations to make the determinations required hereunder (which such firm shall then be referred to as the Consulting Firm hereunder).  All fees and expenses of the Consulting Firm shall be borne solely by the Company.  Any Gross- Up Payment, as determined pursuant to this Section 8, shall be paid by the Company to Employee no later than two and one-half months following the Termination Date.  Any determination by the Consulting Firm shall be binding upon the Company and Employee.  As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Consulting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (“Underpayment”), consistent with the calculations required to be made hereunder.  In the event that the Company exhausts its remedies pursuant to Section 8.3 and Employee thereafter is required to make a payment of any Excise Tax, the Consulting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of Employee within two and one-half months after the date the Company exhausts such remedies.
 
8.3   Employee shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as practicable but no later than thirty (30) days after Employee is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid.  Employee shall not pay such claim prior to the expiration of the thirty (30)-day period following the date on which Employee gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due).  If the Company notifies Employee in writing prior to the expiration of such period that it desires to contest such claim, Employee shall:
 
(a)   give the Company any information reasonably requested by the Company relating to such claim;
 
(b)   take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;
 
(c)   cooperate with the Company in good faith in order to effectively contest such claim; and
 
(d)   permit the Company to participate in any proceedings relating to such claim;
 
provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Employee harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.  Without limitation on the foregoing provisions of this Section 8.3, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Employee to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Employee agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Employee to pay such claim and sue for a refund, the Company shall advance the amount of such payment to Employee, on an interest-free basis and shall indemnify and hold Employee harmless, on an after tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of Employee with respect to which such contested amount is claimed to be due is limited solely to such contested amount.  Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Employee shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.
 
8.4   If, after the receipt by Employee of an amount advanced by the Company pursuant to Section 8.3, Employee becomes entitled to receive any refund with respect to such claim, Employee shall (subject to the Company’s complying with the requirements of Section 8.3) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto).  If, after the receipt by Employee of an amount advanced by the Company pursuant to Section 8.3, a determination is made that Employee shall not be entitled to any refund with respect to such claim and the Company does not notify Employee in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.
 
Section 9.   Covenant Not to Compete
 
9.1   During Employee’s employment with Brown Shoe and/or any Business Unit and for a period of one (1) year after the Termination Date if termination is pursuant to Sections 4.1 or 4.3, or for two (2) years after the Termination Date if termination is pursuant to Section 4.2 (the “Restricted Period”), Employee will not, directly or indirectly, on Employee’s own behalf or on behalf of any other Person (whether as owner, partner, consultant, employee or otherwise):
 
(a)   provide any executive, managerial, supervisory, and/or consulting services with respect to the footwear industry and/or the footwear business in the United States for any Competitor;
 
(b)   hold any executive, managerial and/or supervisory position with any Competitor in the United States;
 
(c)   assist any Competitor in competing against Brown Shoe and/or any Business Unit for which Employee performs or performed substantial work and/or has or had access to Confidential Information (each a “Relevant Business Unit”) (i) in the United States and/or (ii) in any other country in which Brown Shoe and/or any Relevant Business Unit is doing business in the one year immediately preceding the Termination Date (each a “Foreign Country”) if Employee had access to Confidential Information regarding the Company’s business in such Foreign Country;
 
(d)   engage in any research, development and/or planning activities or efforts for a Competitor, whether as an employee, consultant, independent contractor or otherwise, to assist the Competitor in competing (i) in the footwear industry in the United States or (ii) in any Foreign Country if Employee had access to Confidential Information regarding the Company’s business in such Foreign Country;
 
(e)   cause or attempt to cause any Customer to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(f)   assist any Competitor in connection with any plan, effort, activity or undertaking to cause or attempt to cause any Customer to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(g)   cause or attempt to cause any footwear supplier or manufacturer of Brown Shoe and/or any Relevant Business Unit to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit;
 
(h)   assist any Competitor in connection with any plan, effort, activity or undertaking to cause or attempt to cause any footwear supplier or manufacturer of Brown Shoe and/or any Relevant Business Unit to divert, terminate, limit, modify or fail to enter into any existing or potential relationship with Brown Shoe and/or any Relevant Business Unit; and/or
 
(i)   solicit, entice, employ or seek to employ, in the footwear industry, any executive, managerial and/or supervisory employee of, or any consultant or advisor to, Brown Shoe and/or any Relevant Business Unit.
 
9.2   Employee recognizes and agrees that the restraints contained in Section 9.1 are reasonable and should be fully enforceable in view of, among other things, the high level positions Employee has had with Brown Shoe and/or any Relevant Business Unit(s), the national and international nature of both the Company’s collective business and competition in the footwear industry, and the legitimate interests of the Company in protecting its confidential, proprietary and trade secret information (“Confidential Information”) and their respective customer goodwill and relationships.  Employee specifically hereby acknowledges and confirms that Employee is willing and intends to, and will, abide fully by the terms of Section 9.1.  Employee further agrees that the Company would not have adequate protection if Employee were permitted to work for its competitors in violation of the terms of this Agreement since the Company would, among other things, be unable to verify whether (i) its Confidential Information was being disclosed and/or misused, and/or (ii) Employee was involved in diverting or helping to divert the Company’s customers and/or customer goodwill.
 
9.3   Employee agrees to disclose, during the Restricted Period, the terms of this Section 9 to any potential future employer.
 
Section 10.   Confidential Information.
 
10.1   Employee acknowledges and agrees that during Employee’s employment, Employee has been and/or will be provided and have access to certain Confidential Information of the Company.  Employee agrees to keep secret and confidential, and not to use or disclose to any third-parties, except as directly required for Employee to perform Employee's employment responsibilities for the Company, any of the Company’s Confidential Information.
 
10.2   Confidential Information includes all confidential and/or trade secret information of the Company (regardless of the form or medium in which it may exist or be stored or preserved) and includes, but is not limited to, all such information containing or reflecting any:
 
(a)   lists or other identification of customers or prospective customers of Brown Shoe and/or any Relevant Business Unit (and/or key individuals employed or engaged by such parties);
 
(b)   lists or other identification of sources or prospective sources of Brown Shoe’s and/or any Relevant Business Unit’s products or components thereof (and/or key individuals employed or engaged by such parties);
 
(c)   compilations, information, designs, drawings, files, formulae, lists, machines, maps, methods, models, notes or other writings, plans, records, regulatory compliance procedures, reports, specialized or technical data, schematics, source code, object code, documentation, and software relating to the development, manufacture, fabrication, assembly, marketing and/or sale of Brown Shoe’s and/or any Relevant Business Unit’s products;
 
(d)   financial, distribution, sales and marketing information, data, plans, and/or strategies of Brown Shoe and/or any Relevant Business Unit;
 
(e)   equipment, materials, procedures, processes, and techniques used in, or related to, the development, manufacture, assembly, fabrication or other production and quality control of the Brown Shoe’s and/or any Relevant Business Unit’s products and services;
 
(f)   Brown Shoe’s and/or any Relevant Business Unit’s relations and/or dealings with its customers, prospective customers, suppliers and prospective suppliers and the nature and type of products or services rendered to such customers (or proposed to be rendered to prospective customers);
 
(g)   Brown Shoe’s and/or any Relevant Business Unit’s relations with its employees (including, without limitation, salaries, job classifications and skill levels); and
 
(h)   any other information designated by Brown Shoe and/or any Relevant Business Unit to be confidential, secret and/or proprietary (including without limitation, information provided by customers or suppliers of Brown Shoe and/or any Relevant Business Unit).
 
Notwithstanding the foregoing, the term “Confidential Information” shall not consist of any data or other information which has been made publicly available or otherwise placed in the public domain other than by Employee in violation of this Agreement.
 
10.3   Employee will not, directly or indirectly, copy, reproduce or otherwise duplicate, record, abstract, summarize or otherwise use for Employee or use for, or disclose to, any party other than Brown Shoe, or any subsidiary or affiliate of Brown Shoe, any Confidential Information, without Brown Shoe’s prior written permission or except as required for the proper performance of Employee’s duties on behalf of the Company.
 
10.4   Employee understands that Confidential Information may or may not be labeled as “confidential” and will treat all information as confidential unless otherwise informed by Brown Shoe.
 
10.5   At the termination of Employee’s employment with the Company or at any other time Brown Shoe or any subsidiary or affiliate thereof may request, Employee shall promptly deliver to Brown Shoe all documents and other materials, whether in physical or electronic form (including all copies thereof), containing any Confidential Information.
 
Section 11.   Injunctive Relief
 
In the event of a breach or threatened breach of any of Employee’s duties or obligations under the terms and provisions of Section 9, Section 10, Section 12.1, Section 12.3, or Section 12.1010, the Company shall be entitled, in addition to any other legal or equitable remedies it may have in connection therewith (including any right to damages that it may suffer), to temporary, preliminary and permanent injunctive relief restraining such breach or threatened breach.  Employee hereby expressly acknowledges that the harm that might result to the Company’s business as a result of noncompliance by Employee with any of the provisions of Section 9, Section 10, Section 12.3, Section 12.3, or Section 12.1010 would be largely irreparable.  Employee specifically agrees that if there is a question as to the enforceability of any of the provisions of Section 9, Section 10, Section 12.31, Section 12.3 or Section 12.1010, Employee will not engage in any conduct inconsistent with or contrary to such Sections until after the question has been resolved by a final judgment of a court of competent jurisdiction.  Employee undertakes and agrees that if Employee breaches or threatens to breach the Agreement, Employee shall be liable for any attorneys’ fees and costs incurred by the Company in enforcing its rights hereunder.
 
Section 12.   Miscellaneous
 
12.1   No Disparagement .   Employee agrees not to make any statement, verbal or written, which disparages the Employer, its services or products, or its current or former officers, directors, and employees.
 
12.2   Notice .  All notices hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered personally or by courier, or (b) when received by facsimile (including electronic mail), receipt confirmed, or (c) on the third business day following the mailing thereof by registered or certified mail, postage prepaid, or (d) on the first business day following the mailing thereof by overnight delivery service, in each case addressed as set forth below:
 
If to the Company:
 
Brown Shoe Company, Inc.
8300 Maryland Avenue
St. Louis, Missouri  63105
Attention:  General Counsel
 
If to Employee:
 
Mark D. Lardie
­­­­­­­­­­­­­­­­­­­­___________________
___________________
 
Any party may change the address to which notices are to be addressed by giving the other party written notice in the manner herein set forth.
 
12.3   Successors; Binding Agreement .
 
(a)   Brown Shoe shall require any successor to all or substantially all of the business and/or assets of the Company (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise), prior to or upon such succession, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  To the extent such transaction constitutes a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company under Code Section 409A and the regulations thereunder, failure of Brown Shoe to obtain such agreement upon or prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Employee to benefits from the Company in the same amounts and on the same terms as Employee would be entitled hereunder if Employee’s employment was terminated without Cause within twenty-four (24) months after a Change of Control.  For purposes of the preceding sentence, the date on which any such succession becomes effective shall be deemed the Termination Date.
 
(b)   Brown Shoe shall also have the right, but not the obligation, to assign this Agreement, without Employee’s consent, to any successor to all or substantially all of the business and/or assets of a Business Unit for which Employee performs substantially all of Employee’s duties (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise).  In the event, and only in the event, Brown Shoe elects to assign this Agreement to such successor of a Business Unit, a Change of Control will be deemed to have occurred and Brown Shoe shall require such successor to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  No Change of Control shall be deemed to have occurred if Brown Shoe does not elect to assign this Agreement to such successor of a Business Unit.
 
(c)   This Agreement is personal to Employee and Employee may not assign or delegate any part of Employee’s rights or duties hereunder to any other person, except that this Agreement shall inure to the benefit of and be enforceable by Employee’s legal representatives, executors, administrators, heirs and beneficiaries.
 
12.4   Judicial Modification .  If and to the extent that any Section, term and/or provision of this Agreement is determined by a court of competent jurisdiction to be unenforceable under applicable law, then such Section(s), term(s) and/or provision(s) shall not be void but instead shall be modified and, to the maximum extent permissible under applicable law, enforced.
 
12.5   Headings .  The headings in this Agreement are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Agreement.
 
12.6   Counterparts .  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
12.7   Waiver .  Neither any course of dealing nor any failure or neglect of either party hereto in any instance to exercise any right, power or privilege hereunder or under law shall constitute a waiver of such right, power or privilege or of any other right, power or privilege or of the same right, power or privilege in any other instance.  Without limiting the generality of the foregoing, Employee’s continued employment without objection shall not constitute Employee’s consent to, or a waiver of Employee’s rights with respect to, any circumstances constituting Good Reason.  All waivers by either party hereto must be contained in a written instrument signed by the party to be charged therewith, and, in the case of the Company, by its duly authorized officer.
 
12.8   Entire Agreement.   This instrument constitutes the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.
 
12.9   Amendment .  Subject to Section 12.44, no modification, amendment or waiver of any of the provisions of this Agreement shall be effective unless in writing specifically referring hereto, and signed by the parties hereto.
 
12.10   Governing Law .  In light of Company’s and Employee’s substantial contacts with the State of Missouri, the facts that the Company is headquartered in Missouri and Employee resides in and/or reports to Company management in Missouri, the parties’ interests in ensuring that disputes regarding the interpretation, validity and enforceability of this Agreement are resolved on a uniform basis, and Brown Shoe’s execution of, and the making of, this Agreement in Missouri, the parties agree that:  (i) any litigation involving any noncompliance with or breach of the Agreement, or regarding the interpretation, validity and/or enforceability of the Agreement, shall be filed and conducted exclusively in the state courts in St. Louis County, Missouri, or the U.S. District Court for the Eastern District of Missouri; and (ii) this Agreement shall be interpreted in accordance with and governed by the laws of the State of Missouri, without regard for any conflict of law principles.  Employee agrees that Employee under no circumstances will, either alone or in conjunction with anyone else, file or pursue any such litigation other than in such state or federal courts in Missouri, and Employee hereby consents and agrees that any such litigation filed in any other court(s) shall be dismissed and that Employee may be enjoined from filing and/or pursuing any such action.
 
      12.11   409A Compliance.   With respect to those amounts payable hereunder which are subject to Code Section 409A, this Agreement shall be interpreted in a manner so as to be consistent with such provision and the rules and regulations promulgated thereunder.  The Company may modify the Agreement to the extent necessary to prevent a benefit or payment from being subject to a tax due to noncompliance with Code Section 409A.
 
       12.12   Third Party Beneficiaries .  Employee agrees that Brown Shoe’s subsidiaries are third party beneficiaries of this Agreement and hereby consents to the enforcement by any subsidiary of Brown Shoe of the provisions contained herein, including without limitation, the provisions of Section 9  and Section 10 .
 
IN WITNESS WHEREOF, Employee and Brown Shoe have executed this Agreement as of the day and year first above written.
 
Brown Shoe Company, Inc.
 
 
Employee
 
By:
/s/ Douglas Koch
 
/s/ Mark D. Lardie
Name:
Douglas W. Koch
 
Mark D. Lardie
Title:
Senior Vice President and
Chief Talent Officer
 
Senior Vice President and GMM,
Famous Footwear
Date:
3/14/09
 
Date:
3/13/09

 

 


 
 
 


Exhibit A

RELEASE


THIS RELEASE (the “Release”) dated _____________ between Jane Doe (“Employee”) and Brown Shoe Company, Inc., a New York corporation;

WHEREAS, the Company and Employee are parties to a Severance Agreement dated _____________, 200___ and effective as of ______________, 200__ (the “Severance Agreement”);

WHEREAS, the execution of this Release is a condition precedent to, and material inducement to, the Company’s provision of certain benefits under the Severance Agreement;

NOW, THEREFORE, the parties hereto agree as follows:

1.            Mutual Promises.   The Company undertakes the obligations contained in the Severance Agreement, which are in addition to any compensation to which Employee might otherwise be entitled, in exchange for Employee’s promises and obligations contained herein and in the Severance Agreement. The Company’s obligations are undertaken in lieu of any other severance benefits.

2.            Releases of Claims; Agreements Not to File Suit .

a.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, agrees to, and does, remise, release and forever discharge the Company and its subsidiaries and affiliates, each of their shareholders, directors, officers, employees, agents and representatives, and its successors and assigns (collectively, the “Company Released Persons”), from any and all matters, claims, demands, damages, causes of action, debts, liabilities, controversies, judgments and suits of every kind and nature whatsoever, foreseen or unforeseen, known or unknown, which have arisen or could arise from matters which occurred prior to the date of this Release, which matters include without limitation: (i) the matters covered by the Severance Agreement and this Release, (ii) Employee’s employment, and/or termination from employment with the Company, and (iii) any claims which might otherwise arise in the future as a result of arrangements or agreements in effect as of the date of this Release or the continuance of such arrangements and agreements; provided, however, that this Section 2(a) shall not apply to any claims to the payments and benefits specifically provided for in the Severance Agreement or, subject to the terms of the Severance Agreement, the payments or benefits to which Employee, by reason of the termination of Employee’s employment, may be entitled under any employee benefit plan (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974) other than a severance pay plan.

b.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns, and anyone claiming through or under any of the foregoing, agrees that she will not file or otherwise submit any charge, claim, complaint, or action to any agency, court, organization, or judicial forum (nor will Employee permit any person, group of persons, or organization to take such action on Employee’s behalf) against any Company Released Person arising out of any actions or non-actions on the part of any Company Released Person arising before the date of this Release or any action taken after the date of this Release pursuant to the Severance Agreement.  Employee further agrees that in the event that any person or entity should bring such a charge, claim, complaint, or action on Employee’s behalf, Employee hereby waives and forfeits any right to recovery under said claim and will exercise every good faith effort to have such claim dismissed.

c.           The charges, claims, complaints, matters, demands, damages, and causes of action referenced in Sections 2(a) and 2(b) include, but are not limited to: (i) any claim for breach of an actual or implied contract (whether written or oral) of employment between Employee and any Company Released Person (including, but not limited to, any claim of fraud, promissory fraud, promissory estoppel, fraudulent misrepresentation or negligent misrepresentation in the making of any actual or implied contract of employment), (ii) any claim of unjust, wrongful, discriminatory, retaliatory or tortious discharge or other adverse employment action (including any claim of whistleblowing), (iii) any claim of slander, libel or other similar action for defamation, (iv) any claim of intentional tort (including assault, battery, conversion and/or intentional infliction of emotional distress), (v) any claim of negligence (including negligent infliction of emotional distress, negligent supervision, negligent hiring, or negligent retention), (vi) any claim of a violation of a law, statute or ordinance, including, but not limited to, the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq ., the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq . , the Americans with Disabilities Act of 1990, 42 U.S.C. §12101 et seq., the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §201 et seq ., the Rehabilitation Act of 1973, as amended, 29 U.S.C. §701 et seq ., or of the Missouri Human Rights Act, §213.000 R.S. Mo. et seq. , the Missouri Service Letter Statute, §209.140 R.S. Mo., The Massachusetts Fair Employment Practice Act, MGL Ch. 151B, §§ 1-10; the Massachusetts Equal Rights Act, MGL, Ch. 93, § 102; the Wisconsin Fair Employment Act (WFEA), Wis. Stat. §§111.31-111.395, or any other federal, state, or local laws, statutes or ordinances governing or concerning employment (with the exception of the federal Family and Medical Leave Act) the right to recovery in any suit brought by the Equal Employment Opportunity Commission, the Missouri Human Rights Commission, the Massachusetts Human Rights Commission or the Wisconsin Equal Rights Division on behalf of the Employee, or any claims for pay, vacation pay, or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than those payments and benefits specifically provided herein.

d.           This Release shall not affect Employee’s right to any governmental benefits payable under any Social Security, Unemployment Compensation or Worker’s Compensation law now or in the future.

3.            Release of Benefit Claims .  Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, further releases and waives any claims for pay, vacation pay, insurance or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than claims to the payments and benefits specifically provided for in the Severance Agreement

4.            Revocation Period; Knowing and Voluntary Agreement .

 
a.
Time for Consideration and Execution .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that he is entitled to at least twenty-one (21) days within which to consider this Agreement before signing the same, and that Employee has, in fact, been offered at least twenty-one (21) days within which to consider this Agreement before signing the Agreement.  Employee may, however, execute this Agreement sooner than twenty-one (21) days if he so chooses.

 
b.
Time for Revocation .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that this Agreement shall not become effective until the eighth (8th) calendar day after the date of Employee’s execution of this Agreement.  During the seven (7) day period following Employee’s execution of this Agreement, Employee may freely revoke his execution of this Agreement by providing written notification of such revocation to:  _____________________ [name], _____________________ [title], __________________________ [company], ____________________________ [address].  Upon expiration of the seven (7) day period, Employee acknowledges that this Agreement becomes final and binding.  If Employee revokes this Agreement within the seven (7) day period following Employee’s execution of this Agreement, it shall not be effective or enforceable, and Employee will not receive the severance payments and described in the Severance Agreement.

 
c.
Consultation With an Attorney .  By executing this Agreement, Employee acknowledges that, at the time he was presented with this Agreement for consideration, Employee was advised by a representative from Company, in writing, to consult with an attorney about this Agreement, its meaning and effect, before executing this Agreement.

 
d.  
Knowing Release.  Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purposes of making a full and final compromise, adjustment and settlement of all potential claims hereinabove described.

i)  
Employee acknowledges that Employee has been given a period of at least twenty-one (21) days to consider whether to accept this Release.  Furthermore, Employee may revoke this Release for seven (7) days following the execution of this Release.

ii)  
Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purpose of making a full and final compromise, adjustment, and settlement of all potential claims hereinabove described.  Employee hereby acknowledges that Employee has been advised of the opportunity to consult an attorney and that Employee understands the Release and the effect of signing the Release.

 
5.            Severability.   If any provision of this Release or the application thereof to any person or circumstance shall to any extent be held to be invalid or unenforceable, the remainder of this Release and the application of such provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each provision of this Release shall be valid and enforceable to the fullest extent permitted by law.
 
6.            Headings.   The headings in this Release are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Release.
 
7.            Counterparts.   This Release may be executed in one or more identical counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
8.            Entire Agreement.   This Release and the related Severance Agreement constitute the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.
 
9.            Governing Law.   This Release shall be governed by, and construed and enforced in accordance with, the laws of the State of Missouri, without reference to the conflict of laws of such State and the parties agree that any litigation involving this Release, or regarding the interpretation, validity and/or enforceability of this Release, shall be filed and conducted exclusively in the Missouri state court in St. Louis County, Missouri or in the federal court for the Eastern District of Missouri, Eastern Division.
 
IN WITNESS WHEREOF, Employee and the Company have executed this Release as of the day and year first above written.
 
    BROWN SHOE COMPANY, INC.
     
   By:  
     
  EMPLOYEE
     
   By:  
    Jane Doe 
 
 


 
 
 


 
 
 

Exhibit 10.6
Form of Agreement to Certain Severance Agreements
 
                                                                              
   December 18, 2009
 


Name
Title


Dear Name:
 
Section 409A to the Internal Revenue Code (“IRC”) imposes significant limitations on amounts that are considered nonqualified deferred compensation (“NDC”).  Some payments under your Severance Agreement may be subject to these rules.  Therefore, in order to avoid potential negative tax implications to you, we must amend your Severance Agreement to ensure compliance with 409A.
 
In addition, the Internal Revenue Service (“IRS”) recently amended the rules governing the deductibility of compensation paid to top executives of a publicly traded company.  In general, IRC Section 162(m) provides that annual compensation in excess of $1 million is not deductible.  Performance based compensation, however, is not subject to the $1 million limitation.  To ensure payments made in connection with the bonus program are considered to be performance based compensation, we need to make revisions to your agreement.
 
Accordingly, in light of the 409A and 162(m) rules’ possible impact on your severance benefits, your Severance Agreement is amended as follows:
 
1.  
 Section 1.12 of your Severance Agreement is amended to read as follows:
 
1.12           “Termination Date” means the effective date as provided in this Agreement of the termination of Employee’s employment with the Company.  Employee will have a termination of employment only if he has a separation from service determined based on all of the facts and circumstances and in accordance with the rules and regulations issued by the Treasury Department under Code Section 409A.
 
2.  
Section 4.1(b) of your Severance Agreement is amended to read as follows:
 
(b)           The Company shall pay, or cause to be paid, to Employee (i) in a lump sum not later than thirty (30) days after the Termination Date an amount equal to 200% of the sum of (A) Employee’s base annual salary at the highest rate in effect at any time during the twelve (12) months immediately preceding the Termination Date, and (B) Employee’s targeted bonus for the current year, and (ii) Employee’s bonus for the year of termination prorated to the Termination Date, paid at the time such bonus would have been paid if Employee had remained employed to the date of payment and calculated based on achievement of the applicable performance criteria applicable to such bonus payment.
 
3.  
Section 6 of your Severance Agreement is amended to read as follows:
 
Section 6.                      Employee Expenses After Change in Control

If Employee’s employment is terminated by the Company within twenty-four (24) months after a Change in Control and there is a dispute with respect to this Agreement, then all Employee’s costs and expenses (including reasonable legal and accounting fees) incurred by Employee (a) to defend the validity of this Agreement, (b) to contest any termination for Cause, (c) to contest any determinations by the Company concerning the amounts payable by or on behalf of the Company under this Agreement, or (d) to otherwise obtain or enforce any right or benefit provided to Employee by this Agreement, shall be paid by the Company.  The Company shall make payment of such reimbursements from time to time, but in no event later than the last day of the calendar year following the calendar year in which such expenses are incurred, provided Employee timely submits reasonable documentation of such expenses.  In the event Employee is not the prevailing party in any such contest, Employee shall pay back any reimbursements made by the Company hereunder within 30 days of final disposition of such contest.

4.  
Section 7 of your Severance Agreement is amended to read as follows:
 
Section 7.                      Release
 
Notwithstanding anything to the contrary stated in this Agreement, no benefits will be paid pursuant to Section 4 except under Section 4.1(a), 4.2(a) or 4.3 prior to execution by Employee of a release of the Company substantially in the form attached as Exhibit A , with such changes as may be made by the Company in its sole discretion in order to comply with and stay current with applicable laws and regulations.  Unless Employee executes such release and returns it to the Company within 45 days of his Termination Date, all benefits except under Sections 4.1(a), 4.2(a) or 4.3 shall be forfeited.
 
5.  
Section 12.2(a) of your Severance Agreement is amended to read as follows:
 
(a)           Brown Shoe shall require any successor to all or substantially all of the business and/or assets of the Company (whether such succession is direct or indirect, by purchase, merger, consolidation or otherwise), prior to or upon such succession, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would have been required to perform it if no such succession had taken place.  To the extent such transaction constitutes a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company under Code Section 409A and the rules and regulations thereunder, failure of Brown Shoe to obtain such agreement upon or prior to the effectiveness of any such succession shall be a material breach of this Agreement and shall entitle Employee to benefits from the Company in the same amounts and on the same terms as Employee would be entitled hereunder if Employee’s employment was terminated without Cause within twenty-four (24) months after a Change of Control.  For purposes of the preceding sentence, the date on which any such succession becomes effective shall be deemed the Termination Date.

6.  
A new Section 12.11 is added to your Severance Agreement as follows:
 
12.11            409A Interpretation.   With respect to those amounts payable hereunder which are subject to Code Section 409A, this Agreement shall be interpreted in a manner so as to be consistent with such provision and the rules and regulations promulgated thereunder.  The Company may modify the Agreement to the extent necessary to prevent a benefit or payment from being subject to a tax due to noncompliance with Code Section 409A.  Notwithstanding anything herein to the contrary, in the event that Executive is determined to be a specified employee within the meaning of Code Section 409A, for purposes of any payment on termination of employment hereunder, payment(s) shall be made or begin, as applicable, on the first payroll date which is more than six months following the date of separation from service, to the extent required to avoid any adverse tax consequences under Code Section 409A.

Please indicate your agreement to the terms set forth above by signing a copy of this letter and returning it to me
 
Sincerely,
 
     /s/ Sarah Stephenson
 
Sarah Stephenson
 
Vice President Total Rewards
 
 
   Agreed and accepted.
   
   
    Name
   
   
  Date
 

 

 
 
 
Exhibit A

RELEASE


THIS RELEASE (the “Release”) dated _____________ between Jane Doe (“Employee”) and Brown Shoe Company, Inc., a New York corporation;

WHEREAS, the Company and Employee are parties to a Severance Agreement dated _____________, 200___ and effective as of ______________, 200__ (the “Severance Agreement”);

WHEREAS, the execution of this Release is a condition precedent to, and material inducement to, the Company’s provision of certain benefits under the Severance Agreement;

NOW, THEREFORE, the parties hereto agree as follows:

1.            Mutual Promises.   The Company undertakes the obligations contained in the Severance Agreement, which are in addition to any compensation to which Employee might otherwise be entitled, in exchange for Employee’s promises and obligations contained herein and in the Severance Agreement. The Company’s obligations are undertaken in lieu of any other severance benefits.

2.            Releases of Claims; Agreements Not to File Suit .

a.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, agrees to, and does, remise, release and forever discharge the Company and its subsidiaries and affiliates, each of their shareholders, directors, officers, employees, agents and representatives, and its successors and assigns (collectively, the “Company Released Persons”), from any and all matters, claims, demands, damages, causes of action, debts, liabilities, controversies, judgments and suits of every kind and nature whatsoever, foreseen or unforeseen, known or unknown, which have arisen or could arise from matters which occurred prior to the date of this Release, which matters include without limitation: (i) the matters covered by the Severance Agreement and this Release, (ii) Employee’s employment, and/or termination from employment with the Company, and (iii) any claims which might otherwise arise in the future as a result of arrangements or agreements in effect as of the date of this Release or the continuance of such arrangements and agreements; provided, however, that this Section 2(a) shall not apply to any claims to the payments and benefits specifically provided for in the Severance Agreement or, subject to the terms of the Severance Agreement, the payments or benefits to which Employee, by reason of the termination of Employee’s employment, may be entitled under any employee benefit plan (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974) other than a severance pay plan.

b.           Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns, and anyone claiming through or under any of the foregoing, agrees that she will not file or otherwise submit any charge, claim, complaint, or action to any agency, court, organization, or judicial forum (nor will Employee permit any person, group of persons, or organization to take such action on Employee’s behalf) against any Company Released Person arising out of any actions or non-actions on the part of any Company Released Person arising before the date of this Release or any action taken after the date of this Release pursuant to the Severance Agreement.  Employee further agrees that in the event that any person or entity should bring such a charge, claim, complaint, or action on Employee’s behalf, Employee hereby waives and forfeits any right to recovery under said claim and will exercise every good faith effort to have such claim dismissed.

c.           The charges, claims, complaints, matters, demands, damages, and causes of action referenced in Sections 2(a) and 2(b) include, but are not limited to: (i) any claim for breach of an actual or implied contract (whether written or oral) of employment between Employee and any Company Released Person (including, but not limited to, any claim of fraud, promissory fraud, promissory estoppel, fraudulent misrepresentation or negligent misrepresentation in the making of any actual or implied contract of employment), (ii) any claim of unjust, wrongful, discriminatory, retaliatory or tortious discharge or other adverse employment action (including any claim of whistleblowing), (iii) any claim of slander, libel or other similar action for defamation, (iv) any claim of intentional tort (including assault, battery, conversion and/or intentional infliction of emotional distress), (v) any claim of negligence (including negligent infliction of emotional distress, negligent supervision, negligent hiring, or negligent retention), (vi) any claim of a violation of a law, statute or ordinance, including, but not limited to, the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq ., the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq . , the Americans with Disabilities Act of 1990, 42 U.S.C. §12101 et seq., the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §201 et seq ., the Rehabilitation Act of 1973, as amended, 29 U.S.C. §701 et seq ., or of the Missouri Human Rights Act, §213.000 R.S. Mo. et seq. , the Missouri Service Letter Statute, §209.140 R.S. Mo., The Massachusetts Fair Employment Practice Act, MGL Ch. 151B, §§ 1-10; the Massachusetts Equal Rights Act, MGL, Ch. 93, § 102; the Wisconsin Fair Employment Act (WFEA), Wis. Stat. §§111.31-111.395, or any other federal, state, or local laws, statutes or ordinances governing or concerning employment (with the exception of the federal Family and Medical Leave Act) the right to recovery in any suit brought by the Equal Employment Opportunity Commission, the Missouri Human Rights Commission, the Massachusetts Human Rights Commission or the Wisconsin Equal Rights Division on behalf of the Employee, or any claims for pay, vacation pay, or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than those payments and benefits specifically provided herein.

d.           This Release shall not affect Employee’s right to any governmental benefits payable under any Social Security, Unemployment Compensation or Worker’s Compensation law now or in the future.

3.            Release of Benefit Claims .  Employee, for and on behalf of Employee and Employee’s heirs, beneficiaries, executors, administrators, successors, assigns and anyone claiming through or under any of the foregoing, further releases and waives any claims for pay, vacation pay, insurance or welfare benefits or any other benefits of employment with any Company Released Person arising from events occurring prior to the date of this Release other than claims to the payments and benefits specifically provided for in the Severance Agreement

4.            Revocation Period; Knowing and Voluntary Agreement .

 
a.
Time for Consideration and Execution .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that he is entitled to at least twenty-one (21) days within which to consider this Agreement before signing the same, and that Employee has, in fact, been offered at least twenty-one (21) days within which to consider this Agreement before signing the Agreement.  Employee may, however, execute this Agreement sooner than twenty-one (21) days if he so chooses.

 
b.
Time for Revocation .  By executing this Agreement, Employee acknowledges that Employee has been advised by a representative of Company, in writing, that this Agreement shall not become effective until the eighth (8th) calendar day after the date of Employee’s execution of this Agreement.  During the seven (7) day period following Employee’s execution of this Agreement, Employee may freely revoke his execution of this Agreement by providing written notification of such revocation to:  _____________________ [name], _____________________ [title], __________________________ [company], ____________________________ [address].  Upon expiration of the seven (7) day period, Employee acknowledges that this Agreement becomes final and binding.  If Employee revokes this Agreement within the seven (7) day period following Employee’s execution of this Agreement, it shall not be effective or enforceable, and Employee will not receive the severance payments and described in the Severance Agreement.

 
c.
Consultation With an Attorney .  By executing this Agreement, Employee acknowledges that, at the time he was presented with this Agreement for consideration, Employee was advised by a representative from Company, in writing, to consult with an attorney about this Agreement, its meaning and effect, before executing this Agreement.

 
d.  
Knowing Release.  Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purposes of making a full and final compromise, adjustment and settlement of all potential claims hereinabove described.

i)  
Employee acknowledges that Employee has been given a period of at least twenty-one (21) days to consider whether to accept this Release.  Furthermore, Employee may revoke this Release for seven (7) days following the execution of this Release.

ii)  
Employee represents, declares and agrees that Employee voluntarily accepts the payments described above for the purpose of making a full and final compromise, adjustment, and settlement of all potential claims hereinabove described.  Employee hereby acknowledges that Employee has been advised of the opportunity to consult an attorney and that Employee understands the Release and the effect of signing the Release.

 
5.            Severability.   If any provision of this Release or the application thereof to any person or circumstance shall to any extent be held to be invalid or unenforceable, the remainder of this Release and the application of such provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each provision of this Release shall be valid and enforceable to the fullest extent permitted by law.
 
6.            Headings.   The headings in this Release are inserted for convenience of reference only and shall not in any way affect the meaning or interpretation of this Release.
 
7.            Counterparts.   This Release may be executed in one or more identical counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
 
8.            Entire Agreement.   This Release and the related Severance Agreement constitute the entire agreement of the parties in this matter and shall supersede any other agreement between the parties, oral or written, concerning the same subject matter.
 
9.            Governing Law.   This Release shall be governed by, and construed and enforced in accordance with, the laws of the State of Missouri, without reference to the conflict of laws of such State and the parties agree that any litigation involving this Release, or regarding the interpretation, validity and/or enforceability of this Release, shall be filed and conducted exclusively in the Missouri state court in St. Louis County, Missouri or in the federal court for the Eastern District of Missouri, Eastern Division.
 
IN WITNESS WHEREOF, Employee and the Company have executed this Release as of the day and year first above written.
 
    BROWN SHOE COMPANY, INC.
     
   By:  
     
  EMPLOYEE
     
   By:  
    Jane Doe 
 
 


 
 
 



 
 
 
Exhibit 10.7
 
 
JOINDER TO CREDIT AGREEMENT

This Joinder to Credit Agreement (this “ Joinder ”) is made as of this 18th day of June, 2010, by and between:
 
EDELMAN SHOE, INC., a Delaware corporation having a place of business at 8300 Maryland Avenue, St. Louis, Missouri 63105 (“ Edelman ”); and
 
BANK OF AMERICA, N.A., a national banking association having a place of business at 100 Federal Street, Boston, Massachusetts 02110, as Administrative Agent and Collateral Agent for the Lenders party to the Credit Agreement (as defined below) (the “ Agent ”),

in consideration of the mutual covenants herein contained and benefits to be derived herefrom.

W I T N E S S E T H :

A.           Reference is hereby made to that certain Second Amended and Restated Credit Agreement dated as of January 21, 2009 (as the same may be amended, modified, supplemented or restated, the “ Credit Agreement ”) by and between, among others, (i) Brown Shoe Company, Inc., Sidney Rich Associates, Inc., Brown Group Retail, Inc., Brown Shoe International Corp., Buster Brown & Co., Bennett Footwear Group LLC and Shoes.com, Inc., (ii) Brown Shoe Company of Canada Ltd, (iii) the Lenders named therein, (iv) Bank of America, N.A., as Administrative Agent and Collateral Agent for the Lenders, and (v) Bank of America, N.A., as Lead Issuing Bank.  All capitalized terms used herein and not otherwise defined shall have the same meaning herein as in the Credit Agreement.
 
B.           Pursuant to that certain Stock Purchase Agreement, dated as of June 4, 2010, by and among the Lead Borrower, Brown Shoe Investment Company, Inc., a wholly-owned Subsidiary of the Lead Borrower (the “ Buyer ”), and Samuel Edelman, Louise Edelman and John Dulin (collectively, the “ Sellers ”), the Buyer purchased from the Sellers the outstanding Capital Stock of Edelman not previously owned by the Buyer with the result that Edelman is now a wholly-owned Subsidiary of the Buyer and an indirect wholly-owned Subsidiary of the Lead Borrower.  Such acquisition constitutes the Edelman Acquisition under and as defined in the Credit Agreement.
 
C.           Pursuant to clause (a) of the definition of “Permitted Acquisition”, the Edelman Acquisition is a Permitted Acquisition so long as among other things, Edelman becomes a Borrower or Facility Guarantor under the Credit Agreement in accordance with the provisions of Section 5.14 thereof.  Edelman is executing and delivering this Joinder in compliance with such requirement.
 
NOW, THEREFORE, in consideration of the premises, the parties hereto hereby agree as follows:
 
1.  
Joinder and Assumption of Obligations .  Effective as of the date of this Joinder, Edelman hereby acknowledges that it has received and reviewed a copy of the Credit Agreement, and acknowledges and agrees to:
 
a.  
join in the execution of, and become a party to, the Credit Agreement as a Borrower, as indicated with its signature below;
 
b.  
be bound by all representations, warranties, covenants, agreements, liabilities and acknowledgments of a Borrower under the Credit Agreement and the other Loan Documents, in each case, with the same force and effect as if Edelman was a signatory to the Credit Agreement and the other Loan Documents and was expressly named as a Borrower therein; and
 
c.  
assume and perform all duties and Obligations under the Credit Agreement and the other Loan Documents.
 
2.  
Representations and Warranties .  Edelman hereby (i) represents and warrants that prior to and after giving effect to the Edelman Acquisition, no Default or Event of Default exists or would arise therefrom, and (ii) makes all representations, warranties, and covenants set forth in the Credit Agreement as of the date hereof, except for those representations and warranties set forth in Section 3.4 of the Credit Agreement.  To the extent that any changes in any representations, warranties, and covenants require any amendments to the Schedules to the Credit Agreement, such Schedules are hereby updated, as evidenced by any supplemental Schedules (if any) annexed to this Joinder.
 
3.  
Ratification of Loan Documents .  Except as specifically amended by this Joinder and the other documents executed and delivered in connection herewith, all of the terms and conditions of the Credit Agreement and of the other Loan Documents shall remain in full force and effect as in effect prior to the date hereof, without releasing any obligors thereon or collateral security therefor.
 
4.  
Conditions Precedent to Effectiveness .  This Joinder shall not be effective until each of the following conditions precedent have been fulfilled to the satisfaction of the Agent:
 
a.  
This Joinder shall have been duly executed and delivered by the respective parties hereto, and shall be in full force and effect and shall be in form and substance satisfactory to the Agent.
 
b.  
All action on the part of the Loan Parties necessary for the valid execution, delivery and performance by the Loan Parties of this Joinder and all other documentation, instruments, and agreements to be executed in connection herewith shall have been duly and effectively taken and evidence thereof satisfactory to the Agent shall have been provided to the Agent.
 
c.  
Edelman (and each other Loan Party, to the extent requested by the Agent) shall each have delivered the following to the Agent, in form and substance satisfactory to the Agent:
 
i.  
Certificate of Legal Existence and Good Standing issued by the Secretary of the State of its incorporation or organization.
 
ii.  
Certificate of an authorized officer of the due adoption, continued effectiveness, and setting forth the text, of each corporate resolution adopted in connection with the assumption of obligations under the loan arrangement, and attesting to the true signatures of each Person authorized as a signatory to any of the Loan Documents, together with true and accurate copies of all organizational documents.
 
iii.  
Execution and delivery by Edelman of the following Loan Documents:
 
a)  
Allonges to Revolving Credit Notes;
 
b)  
Allonge to Swingline Note;
 
c)  
Joinder to Guaranty;
 
d)  
Joinder to Security Agreement;
 
e)  
Joinder to Fee Letter; and
 
f)  
Such other documents and agreements as the Agent may reasonably require.
 
d.  
The Agent shall have received a favorable written legal opinion of the Loan Parties’ counsel addressed to the Agent and the other Secured Parties, covering such matters relating to Edelman and/or the Loan Documents as the Agent shall reasonably request.
 
e.  
The Agent shall have received all documents and instruments, including Uniform Commercial Code financing statements, required by law or reasonably requested by the Agent to create or perfect the first priority Liens intended to be created under the Loan Documents and all such documents and instruments shall have been so filed, registered or recorded to the satisfaction of the Agent.
 
f.  
All costs and expenses incurred by the Agent in connection with the preparation and negotiation of this Joinder and related documents (including the fees and expenses of counsel to the Agent) shall have been paid in full.
 
g.  
No Default or Event of Default shall have occurred and be continuing.
 
h.  
The Loan Parties shall have executed and delivered to the Agent such additional documents, instruments, and agreements as the Agent may reasonably request.
 
5.  
Miscellaneous .
 
a.  
This Joinder may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument.
 
b.  
This Joinder expresses the entire understanding of the parties with respect to the transactions contemplated hereby.  No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof.
 
c.  
Any determination that any provision of this Joinder or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not effect the validity, legality, or enforceability of such provision in any other instance, or the validity, legality or enforceability of any other provisions of this Joinder.
 
d.  
The Loan Parties shall pay all costs and expenses of the Agent, including, without limitation, reasonable attorneys’ fees in connection with the preparation, negotiation, execution and delivery of this Joinder.
 
e.  
Edelman warrants and represents that it has consulted with independent legal counsel of its selection in connection with this Joinder and is not relying on any representations or warranties of the Agent or the Lenders or their counsel in entering into this Joinder.
 
f.  
THIS JOINDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO ITS PRINCIPLES RELATING TO CHOICE AND CONFLICTS OF LAW), BUT INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
 
[signature pages follow]
 

 
 
 

IN WITNESS WHEREOF, each of the undersigned has caused this Joinder to Credit Agreement to be duly executed and delivered by its proper and duly authorized officer as of the date set forth below.
 

 
      EDELMAN SHOE, INC.
     
   By:   /s/ Thomas H. Lucas
   Name:  Thomas H. Lucas
   Title:  Senior Vice President, Finance and Corporate Development and Treasurer
 
 

Acknowledged and Agreed:


BROWN SHOE COMPANY, INC.
SIDNEY RICH ASSOCIATES, INC.
BROWN GROUP RETAIL, INC.
BUSTER BROWN & CO.
BROWN SHOE INTERNATIONAL CORP.
BENNETT FOOTWEAR GROUP LLC
SHOES.COM
as to each of the foregoing
 
 
 By:   /s/ Thomas H. Lucas
 Name:  Thomas H. Lucas
 Title:  Senior Vice President, Finance and Corporate Development

BROWN SHOE COMPANY OF CANADA LTD
 
 By:   /s/ Thomas H. Lucas
 Name:  Thomas H. Lucas
 Title:  Senior Vice President, Finance and Corporate Development

 

 
 
 

 
      BANK OF AMERICA, N.A., Administrative Agent and Collateral Agent
     
   By:      /s/ Christine Hutchinson
   Name:  Christine Hutchinson
   Title:  Principal
 
 




 
 
 


 
 
 

   
Exhibit 31.1

CERTIFICATIONS
 

I, Ronald A. Fromm, certify that:

 
1.
I have reviewed this report on Form 10-Q of Brown Shoe Company, Inc. (the “registrant”);

 
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  September 7, 2010
 
/s/ Ronald A. Fromm
   
Ronald A. Fromm
   
Chairman of the Board of Directors
and Chief Executive Officer


 
 
 


 
 
 

   
Exhibit 31.2

CERTIFICATIONS
 

I, Mark E. Hood, certify that:

 
1.
I have reviewed this report on Form 10-Q of Brown Shoe Company, Inc. (the “registrant”);

 
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  September 7, 2010
 
/s/ Mark E. Hood
   
Mark E. Hood
   
Senior Vice President and Chief Financial Officer


 
 
 


 
 
 

Exhibit 32.1

Certification Pursuant to
18 U.S.C. §1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
 
 
 
 
In connection with the Quarterly Report of Brown Shoe Company, Inc. (the “Registrant”) on Form 10-Q for the quarter ended July 31, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Ronald A. Fromm, Chairman of the Board of Directors and Chief Executive Officer of the Registrant, and Mark E. Hood, Senior Vice President and Chief Financial Officer of the Registrant, certify, to the best of our knowledge, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
 
 
(1)  
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
 
(2)  
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
 
 

 
 
/s/ Ronald A. Fromm
 
Ronald A. Fromm
 
Chairman of the Board of Directors
and Chief Executive Officer
 
Brown Shoe Company, Inc.
 
September 7, 2010
   
 
/s/ Mark E. Hood
 
Mark E. Hood
 
Senior Vice President and Chief Financial Officer
 
Brown Shoe Company, Inc.
 
September 7, 2010