J C PENNEY CO INC (Form: 8-K, Received: 05/24/2013 16:02:46)

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): May 20, 2013

J. C. PENNEY COMPANY, INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction

of incorporation )

1-15274

(Commission File No.)

26-0037077

(IRS Employer

Identification No.)

6501 Legacy Drive

Plano, Texas

(Address of principal executive offices)

75024-3698

(Zip code)

Registrant’s telephone number, including area code: (972) 431-1000

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01

Entry into a Material Definitive Agreement.

(a) On May 20, 2013, J. C. Penney Company, Inc. (the “Company”), its direct wholly owned subsidiary, J. C. Penney Corporation, Inc. (“JCPenney”), and J. C. Penney Purchasing Corporation, a wholly owned subsidiary of JCPenney (“Purchasing”), entered into a First Amendment (the “Amendment”) to the Amended and Restated Credit Agreement, dated as of January 27, 2012, as further amended and restated as of February 8, 2013 (as amended by the Amendment, the “Revolving Credit Agreement”), among the Company, JCPenney, Purchasing, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Wells Fargo Bank, National Association, as LC agent.

The Amendment increases the amount of additional first and second lien indebtedness that the Company, JCPenney and JCPenney’s subsidiaries may incur to $2.25 billion. Certain of the lenders who are parties to the Revolving Credit Agreement provide commercial banking, investment banking, trustee and custodial services to the Company. The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment which is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference herein.

(b) On May 20, 2013, following receipt of the requisite consents of the holders of JCPenney’s 7⅛% Debentures Due 2023 (the “Notes”), the Company, JCPenney and Wilmington Trust, National Association, as successor trustee, entered into the Sixth Supplemental Indenture (the “Sixth Supplemental Indenture”) to the Indenture, dated as of October 1, 1982, as amended or supplemented, among such parties, governing the Notes. The Sixth Supplemental Indenture eliminates most of the restrictive covenants and certain events of default and other provisions in the Indenture (the “Indenture Amendments”). The Indenture Amendments became operative on May 22, 2013 upon the purchase by JCPenney of not less than 66⅔% in principal amount of the outstanding Notes pursuant to JCPenney’s previously announced tender offer and consent solicitation for the Notes, commenced on April 30, 2013 (the “Tender Offer and Consent Solicitation”).

The foregoing description of the Sixth Supplemental Indenture does not purport to be complete and is qualified in its entirety by reference to the full text of the Sixth Supplemental Indenture which is filed herewith as Exhibit 4.1 to this Current Report on Form 8-K and is incorporated by reference herein.

(c) On May 22, 2013, the Company, JCPenney, and certain subsidiaries of JCPenney (collectively referred to with the Company and JCPenney as the “Credit Parties”) entered into a Credit and Guaranty Agreement (the “Term Loan Credit Agreement”) with the financial institutions party thereto from time to time as lenders, Goldman Sachs Bank USA, as administrative agent (in such capacity, the “Administrative Agent”), collateral agent (in such capacity, the “Collateral Agent”) and lead arranger, and certain other financial institutions party thereto as agents, arrangers or bookrunners, which provides for a $2.25 billion senior secured term loan credit facility (the “Term Loan Credit Facility”). Proceeds of the Term Loan Credit Facility may be used to finance the cash tender offer for the Notes and to fund ongoing working capital requirements and other general corporate purposes. The maturity date for the Term Loan Credit Facility is May 22, 2018, provided that the maturity date may be extended with respect to the loans of lenders agreeing to extend the maturity date subject to certain terms and conditions specified in the Term Loan Credit Agreement.

Interest on the outstanding amount borrowed under the Term Loan Credit Facility accrues at an annual rate equal to either LIBOR or the base rate, at JCPenney’s election, in each case plus an

applicable rate equal to 5.00% per annum with respect to loans bearing interest based on LIBOR or 4.00% per annum with respect to loans bearing interest based on the base rate. LIBOR is the per annum rate reported by Reuters as the average British Bankers Association Interest Settlement Rate for dollar deposits with an interest period of one, two, three or six months (at JCPenney’s election) in the London interbank market, adjusted to account for reserves required to be maintained by member banks of the Federal Reserve System against Eurocurrency liabilities, with a minimum LIBOR floor of 1.00%. The base rate is the per annum rate equal to the greatest of (x) the rate of interest quoted in The Wall Street Journal as the “Prime Rate,” (y) the federal funds effective rate plus 0.50% and (z) LIBOR with an interest period of one month plus 1.00%, with a minimum base rate floor of 2.00%. In addition, JCPenney is required to pay certain fees in connection with the Term Loan Credit Facility, including a closing fee paid to the lenders under the Term Loan Credit Facility equal to 0.50% of the stated principal amount of the Term Loan Credit Facility from the proceeds of the loans funded on the closing date of the Term Loan Credit Facility.

The loans and other obligations under the Term Loan Credit Facility are guaranteed on a senior basis by the Company and the subsidiaries of JCPenney that are Credit Parties and are secured by mortgages on certain real estate of the Credit Parties, in addition to liens on substantially all personal property of the Credit Parties, subject to certain exclusions set forth in the Term Loan Credit Agreement and the related security documents, including a Pledge and Security Agreement (the “Security Agreement”), entered into on May 22, 2013, among the Credit Parties and the Collateral Agent. The Security Agreement provides for a grant of security interest over the collateral described therein in favor of the Collateral Agent on behalf of the lenders and other secured parties under the Term Loan Credit Facility, certain perfection requirements and customary representations and warranties, covenants and remedial provisions. The liens securing the loans and other obligations under the Term Loan Credit Facility with respect to inventory, accounts receivable, deposit accounts and certain related collateral of the Credit Parties are junior to the liens on such collateral securing the loans and other obligations incurred under the revolving credit facility described in section (a) above pursuant to an Intercreditor and Collateral Cooperation Agreement (the “Intercreditor Agreement”), entered into on May 22, 2013, among the Collateral Agent, JPMorgan Chase Bank, N.A., as administrative agent for the lenders party to the Revolving Credit Agreement, and the Credit Parties. The Intercreditor Agreement governs, as between the holders of the liens securing obligations under the Term Loan Credit Facility and the Revolving Credit Agreement and with respect to the collateral common to both such liens, lien priorities, enforcement rights, application of proceeds and rights under insolvency proceedings. The Intercreditor Agreement also provides for customary conditions on refinancing the obligations under the respective credit facilities subject to such Intercreditor Agreement.

The Term Loan Credit Agreement requires domestic subsidiaries of JCPenney which become material subsidiaries after May 22, 2013, subject to certain exceptions, to become guarantors of the Term Loan Credit Facility and grant liens on their assets to secure such guarantees to the extent required by the Term Loan Credit Agreement and the related security documents. In addition, upon the acquisition by a Credit Party of any material real estate assets, subject to certain exclusions, such Credit Party is required to deliver mortgages and related security documents in order to grant a perfected security interest in such material real estate assets to secure the loans and other obligations under the Term Loan Credit Facility.

JCPenney is required to make quarterly repayments of the loans outstanding under the Term Loan Credit Facility in a principal amount equal to $5.625 million during the term of the Term Loan Credit Agreement, beginning September 30, 2013, with such repayments being reduced based on the

application of mandatory and optional prepayments made from time to time pursuant to the terms of the Term Loan Credit Agreement. The Term Loan Credit Agreement contains customary mandatory prepayment provisions with respect to certain asset sales, insurance and condemnation recovery events and excess cash flow. In the event all or any portion of the loans under the Term Loan Credit Facility are repaid (or repriced or effectively refinanced through any amendment of the Term Loan Credit Facility) for any reason, other than any mandatory prepayment with respect to insurance and condemnation recovery events or excess cash flow, prior to May 22, 2015, such repayments or repricings are required to be made at (i) 102.0% of the amount repaid or repriced if such repayment or repricing occurs on or prior to May 22, 2014, and (ii) 101.0% of the amount repaid or repriced if such repayment or repricing occurs after May 22, 2014, but on or prior to May 22, 2015. Repayments or repricings occurring after May 22, 2015, are required to be made at 100.0% of the amount repaid or repriced.

The Term Loan Credit Agreement contains customary representations and warranties, affirmative and negative covenants and events of default for a transaction of this type. If an event of default under the Term Loan Credit Agreement occurs and is continuing, the Administrative Agent, with the consent of or at the request of lenders holding more than 50.0% of the principal amount of the loans outstanding under the Term Loan Credit Facility may declare the loans and all other obligations immediately due and payable in whole or in part or cause the Collateral Agent to enforce any and all liens and security interests securing the loans and other obligations under the Term Loan Credit Facility. In addition, if any Credit Party or any of its subsidiaries becomes the subject of certain voluntary or involuntary proceedings under any bankruptcy, insolvency or other similar debtor relief law, then the loans and other obligations under the Term Loan Credit Agreement will automatically become due and payable without any further action.

Certain of the lenders who are parties to the Term Loan Credit Agreement provide commercial banking, investment banking, trustee and custodial services to the Company.

Item 2.03

Creation of a Direct Financial Obligation or Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01(c) above regarding the Term Loan Credit Agreement is incorporated herein by reference as if fully set forth herein.

Item 8.01

Other Events.

On May 21, 2013, the Company issued a press release announcing the early results of the Tender Offer and Consent Solicitation and the execution of the Sixth Supplemental Indenture. A copy of this press release is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein.

On May 22, 2013, the Company issued a press release announcing the entry into the Term Loan Credit Facility and the Amendment and the acceptance for purchase and payment of all of the $242,782,000 in aggregate principal amount of the Notes validly tendered prior to 5:00 p.m., New York City time, on May 20, 2013, pursuant to the Tender Offer and Consent Solicitation. A copy of this press release is filed as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated by reference herein.

Item 9.01

Financial Statements and Exhibits.

(d)

Exhibit 4.1

Sixth Supplemental Indenture, dated as of May 20, 2013, among J. C. Penney Corporation, Inc., J. C. Penney Company, Inc., as co-obligor, and Wilmington Trust, National Associate, as successor trustee

Exhibit 10.1

First Amendment, dated as of May 20, 2013, to the Amended and Restated Credit Agreement, dated as of January 27, 2012, as further amended and restated as of February 8, 2013, among J. C. Penney Company, Inc., J. C. Penney Corporation, Inc., J. C. Penney Purchasing Corporation, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and Wells Fargo Bank, National Association, as LC agent

Exhibit 99.1

J. C. Penney Company, Inc. Press Release dated May 21, 2013

Exhibit 99.2

J. C. Penney Company, Inc. Press Release dated May 22, 2013

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 hereunto duly authorized.

J. C. PENNEY COMPANY, INC.

By: /s/ Kenneth Hannah

Executive Vice President and

Chief Financial Officer

Exhibit Number Description

4.1	Sixth Supplemental Indenture, dated as of May 20, 2013, among J. C. Penney Corporation, Inc., J. C. Penney Company, Inc., as co-obligor, and Wilmington Trust, National Association, as successor trustee

10.1

99.1	J. C. Penney Company, Inc. Press Release dated May 21, 2013

99.2	J. C. Penney Company, Inc. Press Release dated May 22, 2013

This SIXTH SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of May 20, 2013, among J. C. PENNEY CORPORATION, INC., a Delaware corporation (the “Company”), J. C. PENNEY COMPANY, INC., a Delaware corporation (the “Co-Obligor”), and WILMINGTON TRUST, NATIONAL ASSOCIATION, a corporation organized and existing as a national banking association under the laws of the United States of America, as successor trustee to U.S. Bank, National Association (formerly First Trust of California, National Association, as successor trustee to Bank of America National Trust and Savings Association) (the “Trustee”), under the Indenture, dated as of October 1, 1982, as amended and supplemented to date (the “Indenture”). Capitalized terms used herein and not otherwise defined shall have the meaning assigned to them in the Indenture.

WHEREAS , the Company has issued its 7 ⅛% Debentures Due 2023 (the “Notes”) pursuant to the Indenture;

WHEREAS , the Company has offered to purchase for cash any and all outstanding Notes pursuant to the tender offer commenced on April 30, 2013 (the “Tender Offer”);

WHEREAS , in connection with the Tender Offer, the Company has requested that Holders of the Notes deliver their consents with respect to the amendment of certain provisions of the Indenture;

WHEREAS , Section 10.02 of the Indenture provides that the Company and the Trustee may amend or supplement the Indenture and modify the rights of Holders in certain circumstances with the consent of the Holders of not less than 66 2/3% in Principal Amount of the Outstanding Notes (the “Requisite Percentage”);

WHEREAS , the Holders of at least the Requisite Percentage have duly consented to the proposed modifications set forth in this Supplemental Indenture in accordance with the Indenture (including Section 10.02 thereof);

WHEREAS , the Company and the Co-Obligor have heretofore delivered, or are delivering contemporaneously herewith, to the Trustee (i) copies of resolutions of the Company’s and the Co-Obligor’s board of directors authorizing the execution of this Supplemental Indenture, (ii) evidence of the receipt of the Requisite Percentage of consents of the Holders set forth in the immediately preceding paragraph and (iii) the Opinion of Counsel described in Section 10.03 of the Indenture; and

WHEREAS , all conditions necessary to authorize the execution and delivery of this Supplemental Indenture and, subject to Section 2.02 herein, to make this Supplemental Indenture valid and binding have been complied with or have been done or performed.

NOW, THEREFORE , in consideration of the foregoing and notwithstanding any provision of the Indenture which, absent this Supplemental Indenture, might operate to limit such action, the parties hereto, intending to be legally bound hereby, agree as follows:

SECTION 1.01 Amendments .

(a) Subject to Section 2.02 hereof, the Indenture is hereby amended by deleting in their entirety and replacing with “[Intentionally Omitted.]” Sections 5.04, 5.05, 5.06, 5.07, 5.08, 5.09, 5.10, 5.11, 6.04, 7.01(4), 7.01(7), 7.15, and 11.01(2) of the Indenture.

(b) Effective as of the date hereof, none of the Company, the Co-Obligor, the Trustee or other parties to or beneficiaries of the Indenture shall have any rights, obligations or liabilities under such Sections or Clauses and the Sections or Clauses deleted pursuant to Section 1.01 hereof shall not be considered in determining whether an Event of Default has occurred or whether the Company has observed, performed or complied with the provisions of the Indenture.

SECTION 1.02 Amendment of Definitions and Section References .

(a) Subject to Section 2.02 hereof, the Indenture is hereby amended by deleting any definitions from the Indenture with respect to which references would be eliminated as a result of the amendments of the Indenture pursuant to Section 1.01 hereof. The Notes are also deemed amended as appropriate to reflect the amendments to the Indenture contemplated hereby.

(b) Except to the extent the Indenture would require consent of each Holder for any such deletion, any and all references in the Indenture and the Notes to clauses, Sections or other terms or provisions of the Indenture or Notes referred to in Section 1.01 or that have been otherwise deleted pursuant to this Supplemental Indenture and any and all obligations thereunder related solely to such clauses, Sections, terms or provisions are hereby deleted throughout the Indenture and the Notes, and shall be of no further force and effect.

SECTION 2.01 Effect of Supplemental Indenture . Except as amended hereby, all of the terms of the Indenture shall remain and continue in full force and effect and are hereby confirmed in all respects. From and after the date of this Supplemental Indenture, all references to the Indenture (whether in the Indenture or in any other agreements, documents or instruments) shall be deemed to be references to the Indenture as amended and supplemented by this Supplemental Indenture.

SECTION 2.02 Effectiveness . The provisions of this Supplemental Indenture shall be effective only upon execution and delivery of this instrument by the parties hereto. Notwithstanding the foregoing sentence, the provisions of this Supplemental Indenture shall become operative only upon the purchase by the Company of at least the Requisite Percentage of the Outstanding Notes pursuant to the Tender Offer, excluding Notes owned by the Company, the Co-Obligor, or any Affiliate thereof, with the result that the amendments to the Indenture effected by this Supplemental Indenture shall be deemed to be revoked retroactive to the date hereof if such purchase shall not occur.

SECTION 2.03 Governing Law . This Supplemental Indenture shall be construed in accordance with and governed by, the laws of the State of New York.

SECTION 2.04 No Representations by Trustee . The recitals contained herein shall be taken as the statements of the Company and the Co-Obligor and the Trustee assumes no responsibility for the correctness or completeness of the same.

SECTION 2.05 Successors. All agreements of the Company and the Co-Obligor in this Supplemental Indenture will bind their respective successors. All agreements of the Trustee in this Supplemental Indenture will bind the Trustee’s successor.

SECTION 2.06 Counterparts . This Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall constitute but one and the same instrument.

(signature page follows)

IN WITNESS WHEREOF , the parties hereto have caused this Supplemental Indenture to be duly executed as of the date hereof.

J. C. PENNEY CORPORATION, INC.

By: /s/ Kenneth Hannah

Name: Kenneth Hannah

Title: Executive Vice President and Chief Financial Officer

J. C. PENNEY COMPANY, INC.

By: /s/ Kenneth Hannah

Name: Kenneth Hannah

Title: Executive Vice President and Chief Financial Officer

WILMINGTON TRUST, NATIONAL ASSOCIATION, as successor Trustee

By: /s/ Julie J. Becker

Name: Julie J. Becker

Title: Vice President

FIRST AMENDMENT, dated as of May 20, 2013 (this “ Amendment ”), to the Amended and Restated Credit Agreement dated as of January 27, 2012 (as amended and restated as of February 8, 2013 and further amended through the date hereof, the “ Existing Credit Agreement ”), among J. C. PENNEY COMPANY, INC., J. C. PENNEY CORPORATION, INC., J. C. PENNEY PURCHASING CORPORATION, the financial institutions named therein as lenders, JPMORGAN CHASE BANK, N.A., as Administrative Agent, and WELLS FARGO BANK, NATIONAL ASSOCIATION, as LC Agent.

WHEREAS, the Loan Parties have requested that the Required Lenders amend the Existing Credit Agreement in order to (x) increase the amount of Permitted First-Lien Indebtedness and Permitted Second-Lien Indebtedness permitted to be incurred and (y) make certain other changes, each as set forth herein.

WHEREAS, the Required Lenders are willing to so amend the Existing Credit Agreement, on the terms and subject to the conditions set forth herein.

NOW THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, and subject to the conditions set forth herein, the parties hereto hereby agree as follows:

SECTION 1. Defined Terms . Capitalized terms used but not defined herein (including in the preamble and recitals hereto) have the meanings assigned to them in the Amended Credit Agreement (as defined below). The provisions of Section 1.03 of the Amended Credit Agreement are hereby incorporated by reference herein, mutatis and mutandis.

SECTION 2. Amendments . Effective as of the Amendment Effective Date (as defined below), the Existing Credit Agreement is hereby amended as follows (the Existing Credit

Agreement as so amended being referred to as the “ Amended Credit Agreement ”):

(a) the definition of “Permitted First-Lien Indebtedness” in Section 1.01 of the Existing Credit Agreement is amended by inserting the phrase “(or, subject to clause (ii) of the second sentence of this definition, any Guarantee by a Loan Party thereof)” immediately after the word “Subsidiary” in the second line thereof;

(b) the definition of “Permitted Second-Lien Indebtedness” in Section 1.01 of the Existing Credit Agreement is amended by inserting the phrase “or a Subsidiary (or, subject to clause (ii) of the second sentence of this definition, any Guarantee by a Loan Party thereof)” immediately after the phrase “Parent Borrower” in the second line thereof; and

SECTION 3. Representations and Warranties . Each of Holdings, the Parent Borrower and Purchasing hereby represents and warrants to the Administrative Agent and to each of the Lenders as of the Amendment Effective Date that:

(a) This Amendment has been duly authorized by each of Holdings, the Parent Borrower and Purchasing and has been duly executed and delivered by each of Holdings, the Parent Borrower and Purchasing and constitutes a legal, valid and binding obligation of Holdings, the Parent Borrower and Purchasing, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer 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.

(b) Each of the representations and warranties of the Loan Parties set forth in the Amended Credit Agreement and the other Loan Documents is true and correct (or, in the case of any representation or warranty not qualified as to materiality, true and correct in all material respects) on and as of the date hereof, except to the extent such representations and warranties relate to an earlier date, in which case such representations and warranties are true and correct (or, in the case of any representation or warranty not qualified as to materiality, true and correct in all material respects) as of such earlier date.

(c) At the time of and immediately after giving effect to this Amendment, no Default shall have occurred and be continuing.

SECTION 4. Conditions to Effectiveness . This Amendment shall become effective as of the first date (the “ Amendment Effective Date ”) on which each of the following conditions has been satisfied:

(a) the Administrative Agent shall have executed a counterpart of this Amendment and the Administrative Agent (or its counsel) shall have received from the Required Lenders, Holdings, the Parent Borrower, and Purchasing either (i) a counterpart of this Amendment signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy or electronic transmission of a signed signature page of this Amendment) that such party has signed a counterpart of this Amendment; and

(b) the Administrative Agent shall have received from the Parent Borrower a consent fee, for the account of each Lender that shall have delivered a counterpart of this Amendment signed on behalf of such party (or that shall have provided to the Administrative Agent written evidence satisfactory to the Administrative Agent (which may include telecopy or electronic transmission of a signed signature page of this Amendment) that such party has signed a counterpart of this Amendment) prior to 4:00 p.m., New York time, on May 20, 2013 (each such Lender, an “ Initial Consenting Lender ”), in an amount equal to the product of (x) 0.10% multiplied by (y) the Commitment held by such Initial Consenting Lender as of the Amendment Effective Date.

The Administrative Agent shall notify the Parent Borrower and the Lenders of the Amendment Effective Date, and such notice shall be conclusive and binding.

SECTION 5. Covenant . If the Amendment Effective Date occurs, the Parent Borrower shall pay to the Administrative Agent, for the account of each Lender (other than any Initial Consenting Lender) that shall deliver a counterpart of this Amendment signed on behalf of such party (or that shall provide to the Administrative Agent written evidence satisfactory to the Administrative Agent (which may include telecopy or electronic transmission of a signed

signature page of this Amendment) that such party has signed a counterpart of this Amendment prior to 5:00 p.m., New York time, on May 24, 2013 (the “ Consent Cutoff Date ”), a consent fee (a “ Post-Effective Date Consent Fee ”) in an amount equal to the product of (x) 0.10% multiplied by (y) the Commitment held by such Lender (other than any Initial Consenting Lender) as of the Consent Cutoff Date. The Post-Effective Date Consent Fees shall be due and payable on May 28, 2013. The Parent Borrower acknowledges and agrees that the failure to make payments in respect of Post-Effective Date Consent Fees shall constitute an Event of Default under the Amended Credit Agreement as if fully set forth therein if such failure shall continue unremedied for 5 days.

SECTION 6. Effect of Agreement ; No Novation . (a) Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of any Loan Party, the Administrative Agent, any Issuing Bank, the Swingline Lender or any Lender under the Existing Credit Agreement or any other Loan Document, and shall not alter, modify, amend or in any way affect the Existing Credit Agreement or any other Loan Document, all of which, as amended, supplemented or otherwise modified hereby, are ratified and affirmed in all respects and shall continue in full force and effect. Nothing herein shall be deemed to entitle any Loan Party to a consent to, or a waiver, amendment, modification or other change of, the Amended Credit Agreement or any other Loan Document in similar or different circumstances. This Amendment shall constitute a Loan Document for all purposes of the Amended Credit Agreement. On and after the Amendment Effective Date, any reference to the Existing Credit Agreement in any Loan Document shall be deemed to be a reference to the Amended Credit Agreement.

(b) Neither this Amendment nor the effectiveness of the Amended Credit Agreement shall extinguish the obligations for the payment of money outstanding under the Existing Credit Agreement or discharge or release the priority of any Security Document, any other security therefor or any Guarantee thereof. Nothing contained herein shall be construed as a substitution or novation of the Obligations outstanding under the Existing Credit Agreement or the Security Documents, which shall remain in full force and effect, except as modified hereby.

SECTION 7. Applicable Law . THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 8. Counterparts . This Amendment may be executed in any number of counterparts and by separate parties hereto on separate counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one agreement. Delivery of an executed signature page to this Amendment by facsimile or email transmission shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 9. Expenses . The Parent Borrower agrees to reimburse the Administrative Agent for its reasonable out-of-pocket expenses in connection with this Amendment and the transactions contemplated hereby, including the fees, charges and disbursements of counsel for the Administrative Agent.

SECTION 10. Headings . The Section headings used herein are for convenience of reference only, are not part of this Amendment and are not to affect the construction of, or to be taken into consideration in interpreting, this Amendment.

IN WITNESS WHEREOF, the parties hereto have cause this Amendment to be duly executed by their respective authorized officers as of the day and year first written above.

J.C. PENNEY COMPANY, INC.,

By: /s/ Kenneth Hannah

Name: Kenneth Hannah

Title: Executive Vice President and Chief Financial Officer

J.C. PENNEY CORPORATION, INC.,

By: /s/ Kenneth Hannah

Name: Kenneth Hannah

Title: Executive Vice President and Chief Financial Officer

J.C. PENNEY PURCHASING CORPORATION,

By: /s/ Windon Chau

Name: Windon Chau

Title: VP, Treasurer

[Signature Page to First Amendment]

JPMORGAN CHASE BANK, N.A.,

individually and as Administrative Agent

By: /s/ Barry K. Bergman

Name: Barry K. Bergman

Title: Managing Director

[Signature Page to First Amendment]

Wells Fargo Bank, National Association

as Lender

By: /s/ Danielle Baldinelli

Name: Danielle Baldinelli

Title: Director

By: /s/ Danielle Baldinelli

Name: Danielle Baldinelli

Title: Director

[Signature Page to First Amendment]

Bank of America, N.A.,

as Lender

By: /s/ Christine Hutchinson

Name: Christine Hutchinson

Title: Director

[Signature Page to First Amendment]

Barclays Bank PLC,

as Lender

By: /s/ Ronnie Glenn

Name: Ronnie Glenn

Title: Vice President

[Signature Page to First Amendment]

UBS LOAN FINANCE LLC,

as Lender

By: /s/ Lana Gifas

Name: Lana Gifas

Title: Director

By: /s/ Joselin Fernandes

Name: Joselin Fernandes

Title: Associate Director

[Signature Page to First Amendment]

THE ROYAL BANK OF SCOTLAND PLC,

as Lender

By: /s/ Tracy Rahn

Name: Tracy Rahn

Title: Director

[Signature Page to First Amendment]

U.S. Bank National Association,

as Lender

By: /s/ Christopher Fudge

Name: Christopher Fudge

Title: Vice President

[Signature Page to First Amendment]

Goldman Sachs Bank USA,

as Lender

By: /s/ Michelle Latzoni

Name: Michelle Latzoni

Title: Authorized Signatory

[Signature Page to First Amendment]

PNC BANK, NATIONAL ASSOCIATION,

as Lender

By: /s/ Chad Greene

Name: Chad Greene

Title: Officer

[Signature Page to First Amendment]

Regions Bank,

as Lender

By: /s/ Connie Ruan

Name: Connie Ruan

Title: Attorney-in-Fact

[Signature Page to First Amendment]

Siemens Financial Services, Inc.

as Lender

By: /s/ Sharen Prusakowski

Name: Sharen Prusakowski

Title: V.P.

By: /s/ Jeff Berger

Name: Jeff Berger

Title: V.P, Head of Bus. Admin.

[Signature Page to First Amendment]

Standard Chartered Bank,

as Lender

By: /s/ Johanna Minaya

Name: Johanna Minaya

Title: Associate Director

By: /s/ Robert Reddington

Name: Robert Reddington

Title: Credit Documentation Manager

[Signature Page to First Amendment]

State Street Bank and Trust Company,

as Lender

By: /s/ Kimberly R. Costa

Name: Kimberly R. Costa

Title: Vice President

[Signature Page to First Amendment]

THE BANK OF NEW YORK MELLON,

as Lender

By: /s/ Thomas J. Tarasovich, Jr.

Name: Thomas J. Tarasovich, Jr.

Title: Vice President

[Signature Page to First Amendment]

UMB Bank, n.a,

as Lender

By: /s/ David A. Proffitt

Name: David A. Proffitt

Title: Senior Vice President

[Signature Page to First Amendment]

CITY NATIONAL BANK,

as Lender

By: /s/ Robert Yasuda

Name: Robert Yasuda

Title: Vice President

[Signature Page to First Amendment]

KEYBANK NATIONAL ASSOCIATION,

as Lender

By: /s/ Andrew Blickensderfer

Name: Andrew Blickensderfer

Title: Assistant Vice President

[Signature Page to First Amendment]

RB International Finance USA LLC,

as Lender

By: /s/ John A. Valiska

Name: John A. Valiska

Title: First Vice President

By: /s/ Christoph Hoedl

Name: Christoph Hoedl

Title: First Vice President

[Signature Page to First Amendment]

jcpenney Announces Successful Early Tender Offer and Consent Solicitation Results For

7 1/8% Debentures Due 2023

PLANO, Texas (May 21, 2013) -- J. C. Penney Company, Inc. (NYSE: JCP) (the “Company”), as co-obligor on the Notes (as defined below), and J. C. Penney Corporation, Inc., a wholly owned subsidiary of the Company (“JCP,” and together with the Company, “J. C. Penney”), as issuer of the Notes, announced today early results of JCP’s previously announced cash tender offer for its outstanding 7 1/8% Debentures Due 2023 (CUSIP No. 708160 BE5) (the “Notes”) and related solicitation for consents to previously described amendments to the indenture, as amended and supplemented, governing the Notes (the “Indenture”) that would eliminate most of the restrictive covenants and certain events of default and other provisions in the Indenture (the “Proposed Amendments”), upon the terms and subject to the conditions set forth in the Offer to Purchase and Consent Solicitation Statement, dated as of April 30, 2013, as supplemented, and the accompanying Consent and Letter of Transmittal, as amended and restated (together, the “Offer Documents”).

As of 5:00 p.m., New York City time, on May 20, 2013 (the “Consent Expiration”), $242,782,000 in aggregate principal amount of the Notes, representing 95.41% of the outstanding principal amount of the Notes had been validly tendered and not validly withdrawn in the tender offer. The withdrawal time (the “Withdrawal Time”) expired at 5:00 p.m., New York City time, on May 13, 2013. As a result, JCP has obtained consents to the Proposed Amendments from holders representing at least 66 2/3% in aggregate principal amount of the outstanding Notes. Having received the requisite consents from the holders of the Notes in connection with the consent solicitation, JCP, the Company and Wilmington Trust, National Association, the successor trustee for the Notes, executed a supplemental indenture (the “Supplemental Indenture”) effecting the Proposed Amendments. Pursuant to the terms of the Supplemental Indenture, the Supplemental Indenture became effective upon execution, but the Proposed Amendments will not become operative until JCP purchases in the tender offer not less than 66 2/3% in outstanding principal amount of the Notes.

Subject to the completion of the tender offer, holders who validly tendered (and did not validly withdraw) their Notes and thereby delivered consents prior to the Consent Expiration shall receive a total consideration equal to $1,450 per $1,000 principal amount of the Notes, which includes a consent payment of $50 for each $1,000 principal amount of Notes, plus accrued and unpaid interest to, but not including, the applicable payment date for the Notes.

Completion of the tender offer and consent solicitation is subject to the satisfaction or waiver of certain conditions that are set forth in the Offer Documents, including, but not limited to, receipt of debt financing on terms satisfactory to J. C. Penney and in an amount that will be sufficient to pay the total consideration for all tendered Notes. The tender offer is scheduled to expire at 11:59 p.m., New York City time, on June 4, 2013, unless extended or earlier terminated by JCP in its sole discretion (the “Expiration Time”). Holders who tender their Notes after the Consent Expiration, but before the Expiration Time, will be eligible to receive $1,400 per $1,000 principal amount of the Notes. Holders whose Notes are accepted for purchase in the tender offer will also receive accrued and unpaid interest to, but not including, the applicable payment date for the Notes. JCP may, but is not required to, select an initial settlement date (“Initial Settlement Date”)

for Notes validly tendered (and not validly withdrawn) prior to the Consent Expiration, which would be a business day it chooses following the satisfaction or waiver of the conditions to the consummation of the tender offer and consent solicitation. JCP currently expects such date to be May 22, 2013, though there is no guarantee JCP will select this Initial Settlement Date or any Initial Settlement Date. Payment for the Notes validly tendered and not purchased on an Initial Settlement Date will be made promptly after the Expiration Time.

Since JCP has received sufficient consents to effect the Proposed Amendments, JCP does not expect to satisfy and discharge any Notes that are not tendered in the tender offer, and any Notes that are not tendered and accepted for purchase in the tender offer are expected to remain outstanding after the consummation of the tender offer.

Goldman, Sachs & Co. is acting as dealer manager and solicitation agent for the tender offer and consent solicitation. Questions regarding the tender offer and consent solicitation may be directed to Goldman, Sachs & Co. at (800) 828-3182 (toll-free) or (212) 902-5183 (collect).

D.F. King & Co., Inc. is acting as tender and information agent for the tender offer and consent solicitation. Requests for copies of the Offer Documents may be directed to D.F. King & Co., Inc. at (212) 269-5550 (banks and brokers) or (800) 290-6427 (toll-free).

This press release is for informational purposes only and does not constitute an offer to purchase or the solicitation of an offer to sell any Notes. The tender offer is not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. No recommendation is made as to whether or not holders of Notes should tender their Notes pursuant to the tender offer or provide consents to the Proposed Amendments. The tender offer and consent solicitation is being made solely pursuant to the Offer Documents, which more fully set forth and govern the terms and conditions of the tender offer and consent solicitation. The Offer Documents contain important information and should be read carefully before any decision is made with respect to the tender offer and consent solicitation.

For further information:

Investor Relations: (972) 431.5500

jcpinvestorrelations@jcpenney.com

Media Relations: (972) 431.3400

jcpcorpcomm@jcpenney.com

This release may contain forward-looking statements. Such forward-looking statements, which reflect the Company’s current views of future events and financial performance, involve known and unknown risks and uncertainties that may cause the Company’s actual results to be materially different from planned or expected results. Those risks and uncertainties include, but are not limited to, the success of our transformation, the impact of changes designed to transform our business, competition and promotional activities, changes in merchandise styles and trends, changes in store traffic trends, maintaining an appropriate mix and level of inventory, the implementation of our new store layout, the availability of internal and external sources of liquidity, our failure to retain, attract and motivate our employees, the reduction and restructuring of our

workforce, the impact of cost reduction initiatives, a systems failure and/or security breach that results in the theft, transfer or unauthorized disclosure of customer, employee or Company information, disruptions in our information technology systems or website, changes in our credit ratings, our failure to source and deliver merchandise in a timely and cost-effective manner, changes in our arrangements with our suppliers and vendors, restrictions under our revolving credit facility, potential asset impairment charges, risks associated with importing merchandise from foreign countries, economic and political conditions that impact consumer confidence and spending, the impact of holiday spending patterns and weather conditions, changes in federal, state or local laws and regulations, legal and regulatory proceedings, significant changes in discount rates, actual investment return on pension assets and other factors related to our qualified pension plan, the influence of our largest stockholders, the volatility of our stock price and our ability to use net operating loss carryforwards to offset future taxable income for U.S. federal income tax purposes. Please refer to the Company’s most recent Form 10-K and subsequent filings for a further discussion of risks and uncertainties. Investors should take such risks into account when making investment decisions. We do not undertake to update these forward-looking statements as of any future date.

jcpenney Announces Consummation of $2.25 Billion Term Loan and

Initial Settlement of its Tender Offer and Consent Solicitation

Size of Term Loan Increased from Initial $1.75 Billion Commitment

PLANO, Texas (May 22, 2013) – J. C. Penney Company, Inc. (NYSE: JCP) (the “Company”) announced today that its wholly owned subsidiary, J. C. Penney Corporation, Inc. (“JCP”), has entered into a new five-year $2.25 billion senior secured term loan credit facility. The size of the facility was increased from the $1.75 billion anticipated in the commitment letter the Company announced on April 29, 2013. Proceeds of the term loan credit facility will be used to finance the cash tender offer for the Notes (as defined and described in more detail below) and to fund ongoing working capital requirements and other general corporate purposes. The term loan credit facility is guaranteed by the Company and certain subsidiaries of JCP, and is secured by mortgages on certain real estate of JCP and the guarantors, in addition to substantially all other assets of JCP and the guarantors.

Chief Financial Officer Ken Hannah said, “We are extremely pleased with the consummation of our term loan and the success of our tender offer. We appreciate the strong demand from investors and their confidence in jcpenney’s future. This new funding gives us the financial flexibility to pursue our plans to put the Company back on a path to profitable growth. ”

Goldman Sachs Bank USA was the lead arranger of the term loan credit facility, with Barclays, J.P. Morgan Securities LLC, BofA Merrill Lynch and UBS Securities LLC serving as the other joint arrangers.

The Company also announced today that JCP amended its revolving credit facility to increase the amount of additional first and second lien indebtedness that it can incur to $2.25 billion, which permits the borrowing of the loans under the new term loan credit facility. Pricing and maturity terms under the revolving credit facility remain unchanged.

Initial Settlement of Tender Offer and Consent Solicitation

The Company, as co-obligor on the Notes, and JCP, as issuer of the Notes, announced today the acceptance for purchase and payment (the “Initial Settlement”) of all of the $242,782,000 in aggregate principal amount of JCP’s 7 1/8% Debentures Due 2023 (CUSIP No. 708160 BE5) (the “Notes”) validly tendered (and not validly withdrawn) prior to 5:00 p.m., New York City time, on May 20, 2013 (the “Consent Expiration”), pursuant to JCP’s previously announced cash tender offer for the Notes and related solicitation of consents to certain proposed amendments to the indenture, as amended and supplemented, governing the Notes (the "Indenture") to eliminate most of the restrictive covenants and certain events of default and other provisions in the Indenture (the "Indenture Amendments"). Payment of the tendered Notes pursuant to the Initial Settlement was made today and holders who validly tendered (and did not validly withdraw) their Notes prior to the Consent Expiration received a total consideration equal to $1,450 per $1,000 principal amount of the Notes, which included a consent payment of $50 for each $1,000 principal

amount of the Notes, plus accrued and unpaid interest to, but not including, the applicable payment date for the Notes.

As previously announced, upon receipt of the requisite consents from holders of the Notes, JCP, the Company and Wilmington Trust, National Association, the successor trustee under the Indenture, executed a supplemental indenture (the “Supplemental Indenture”) to the Indenture to effect the Indenture Amendments. Pursuant to the terms of the Supplemental Indenture, the Supplemental Indenture became effective upon execution, and the Indenture Amendments became operative upon the Initial Settlement. Notes outstanding following the Initial Settlement are subject to the terms of the Supplemental Indenture even if the holders of such Notes did not consent to the Indenture Amendments.

The tender offer will expire at 11:59 p.m., New York City time, on June 4, 2013, unless extended or terminated (such date and time, as the same may be extended or earlier terminated, the "Expiration Time"). Holders who tender their Notes after the Consent Expiration, but before the Expiration Time, will be eligible to receive $1,400 per $1,000 principal amount of the Notes, plus accrued and unpaid interest to, but not including, the applicable payment date for the Notes.

D.F. King & Co., Inc. is acting as tender and information agent for the tender offer and consent solicitation. Requests for copies of the tender offer documents may be directed to D.F. King & Co., Inc. at (212) 269-5550 (banks and brokers) or (800) 290-6427 (toll-free).

This press release is for informational purposes only and does not constitute an offer to purchase or the solicitation of an offer to sell any Notes. The tender offer is not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. No recommendation is made as to whether or not holders of Notes should tender their Notes pursuant to the tender offer. The tender offer is being made solely pursuant to the tender offer documents, which more fully set forth and govern the terms and conditions of the tender offer. The tender offer documents contain important information and should be read carefully before any decision is made with respect to the tender offer.

For further information:

Investor Relations: (972) 431.5500

jcpinvestorrelations@jcpenney.com

Media Relations: (972) 431.3400

jcpcorpcomm@jcpenney.com

Corporate Website

ir.jcpenney.com

changes in store traffic trends, maintaining an appropriate mix and level of inventory, the implementation of our new store layout, the availability of internal and external sources of liquidity, our failure to retain, attract and motivate our employees, the reduction and restructuring of our workforce, the impact of cost reduction initiatives, a systems failure and/or security breach that results in the theft, transfer or unauthorized disclosure of customer, employee or Company information, disruptions in our information technology systems or website, changes in our credit ratings, our failure to source and deliver merchandise in a timely and cost-effective manner, changes in our arrangements with our suppliers and vendors, restrictions under our revolving credit facility, potential asset impairment charges, risks associated with importing merchandise from foreign countries, economic and political conditions that impact consumer confidence and spending, the impact of holiday spending patterns and weather conditions, changes in federal, state or local laws and regulations, legal and regulatory proceedings, significant changes in discount rates, actual investment return on pension assets and other factors related to our qualified pension plan, the influence of our largest stockholders, the volatility of our stock price and our ability to use net operating loss carryforwards to offset future taxable income for U.S. federal income tax purposes. Please refer to the Company’s most recent Form 10-K and subsequent filings for a further discussion of risks and uncertainties. Investors should take such risks into account when making investment decisions. We do not undertake to update these forward-looking statements as of any future date.

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