Amendment No. 1 to Credit and Guaranty Agreement among The William Carter Company, Carter Holdings, Inc., Carter's Imagination, Inc., Carter's De San Pedro, Inc., and Fleet National Bank

Summary

This amendment updates the existing Credit and Guaranty Agreement between The William Carter Company, Carter Holdings, Inc., Carter's Imagination, Inc., Carter's De San Pedro, Inc., and Fleet National Bank, along with other lenders. The main change allows directors to invest cash in Carter Holdings, Inc. without requiring the company to prepay loans or reduce revolving credit, up to a specified limit. All other terms of the original agreement remain in effect. The amendment is effective upon signing by all parties.

EX-10.9 4 a2087903zex-10_9.txt EXHIBIT 10.9 EXHIBIT 10.9 THE WILLIAM CARTER COMPANY CARTER HOLDINGS, INC. CARTER'S IMAGINATION, INC. CARTER'S DE SAN PEDRO, INC. The Proscenium 1170 Peachtree Street NE, Suite 900 Atlanta, GA 30309 AMENDMENT NO.1 OF CREDIT AND GUARANTY AGREEMENT March 27, 2002 FLEET NATIONAL BANK as Administrative Agent under the Credit Agreement defined herein 100 Federal Street Boston, Massachusetts 02110 Ladies and Gentlemen: Each of the William Carter Company (the "COMPANY") and Carter Holdings, Inc. ("HOLDINGS"), each Massachusetts corporation, and Carter's De San Pedro, Inc. and Carter's Imagination, Inc., each a Delaware corporation, hereby agrees with you as follows: 1. REFERENCE TO CREDIT AGREEMENT AND DEFINITIONS. Reference is made to the Credit and Guaranty Agreement dated as of August 15, 2001 among the Company, Holdings, certain subsidiaries of the Company, as Guarantors, the Lenders from time to time party thereto, Goldman Sachs Credit Partners L.P., as Lead Arranger, Book Runner, and as Syndication Agent, Fleet National Bank, as Administrative Agent and as Collateral Agent, and BNP Paribas, as Documentation Agent (the "CREDIT AGREEMENT"). Terms defined in the Credit Agreement and not otherwise defined herein are used herein with the meanings so defined. 2. RECITAL. The Company has advised the Lenders that it desires certain amendments to the Credit Agreement in order to permit directors of the Company and/or Holdings to invest cash in Holdings without causing the Company to prepay the Loans or reduce the Revolving Commitments. The Requisite Lenders have agreed to amend the relevant provision of the Credit Agreement. 3. AMENDMENTS. The Credit Agreement is hereby amended, effective as of the date hereof, as follows: 3.1 Section 2.14(c) of the Credit Agreement is amended to read in its entirety as follows: (c) ISSUANCE OF EQUITY SECURITIES. On the date of receipt by Holdings of any Cash proceeds from a capital contribution to, or the issuance of any Capital Stock of, Holdings (other than (i) pursuant to any employee stock or stock option compensation plan, (ii) in connection with Permitted Acquisitions, or (iii) up to an aggregate of $2,500,000 of proceeds from (a) the issuance of any Capital Stock to directors of Holdings and/or the Company and (b) pursuant to any stock option compensation plan to directors of Holdings and/or the Company), Company shall prepay the Loans and/or the Revolving Commitments shall be permanently reduced as set forth in Section 2.15(b) in an aggregate amount equal to 50% of such proceeds, net of underwriting discounts and commissions and other reasonable costs and expenses associated therewith, including reasonable legal fees and expenses. 4. REPRESENTATIONS AND WARRANTIES. In order to induce you to enter into this amendment, the Company and Holdings hereby represent and warrant that (i) each of the representations and warranties contained in Section 4 of the Credit Agreement is true and correct on the date hereof, except for representations and warranties that speak as of a specific date in which they were true and correct on such earlier date and (ii) after giving effect to this amendment no Default or Event of Default under the Credit Agreement shall have occurred and be continuing. 5. MISCELLANEOUS. Except as expressly modified by this amendment, the Credit Agreement and each of the other Credit Documents are and remain unchanged and in full force and effect. This amendment may be executed in any number of counterparts, which together shall constitute one instrument, shall be Credit Document, shall be governed by and construed in accordance with the laws of the State of New York (without giving effect to the conflict of laws rules of any jurisdiction) and shall bind and inure to the benefit of the parties hereto and their respective successors and assigns. If the foregoing corresponds with your understanding of our agreement, please sign this letter and the accompanying copies thereof in the appropriate space below and return the same to the undersigned. This letter shall become a binding agreement among each of the Lenders and the Agent when both the Company and the Agent shall have one or more copies hereof executed by each of the Company and the Agent on behalf of the Requisite Lenders. 2 Very truly yours, THE WILLIAM CARTER COMPANY CARTER HOLDINGS, INC. By: /s/ Michael D. Casey ---------------------- Name: Michael D. Casey Title: Senior Vice President & CFO CARTER'S DE SAN PEDRO, INC. CARTER'S IMAGINATION, INC. By: /s/ Michael D. Casey ---------------------- Name: Michael D. Casey Title: Senior Vice President & CFO S-1 FLEET NATIONAL BANK, as Administrative Agent, Collateral Agent, Swing Line Lender, Issuing Bank and a Lender BY: /s/ [ILLEGIBLE] ---------------- Name: [ILLEGIBLE] Title: V.P. S-2 GOLDMAN SACHS CREDIT PARTNERS L.P. as Lead Arranger, Syndication Agent and a Lender By: /s/ [ILLEGIBLE] ----------------- Authorized Signatory S-3 ARCHIMEDES FUNDING IV (CAYMAN), LTD., by: ING Capital Advisors LLC, as Collateral Manager By: /s/ John J. D'Angelo ---------------------- Name: John J. D'Angelo Title: Vice President S-8 ARCHIMEDES FUNDING III, LTD., by: ING Capital Advisors LLC, as Collateral Manager By: /s/ John J. D'Angelo -------------------------- Name: John J. D'Angelo Title: Vice President S-9 Ares V CLO LTD. By: Ares CLO GP V, LLC Its Managing Member By: /s/ Seth J. Brufsky --------------------- Name: Seth J. Brufsky Title: Vice President BLACK DIAMOND INTERNATIONAL FUNDING LTD., By: /s/ Alan Corkish ------------------- Name: Alan Corkish Title: Director S-12 BNP PARIBAS, By: /s/ Cecile Scherer --------------------- Name: CECILE SCHERER Title: Director Merchant Banking Group By: /s/ Richard Cushing --------------------- Name: Title: S-13 CIT LENDING SERVICES CORPORATION (ILLINOIS), By: /s/ John P. Sirico, II ----------------------- Name: John P. Sirico, II Title: Vice President By: Denali Capital LLC, managing member of DC Funding Partners LLC, collateral manager for, DENALI CAPITAL CLO I, LTD., Denali Capital LLC, managing member of DC Funding Partners LLC, portfolio manager for DENALI CAPITAL CLO I, LTD. By: /s/ John Thacker ------------------ Name: John Thacker Title: Chief Credit Officer S-15 DRYDEN HIGH YIELD CDO 2001-I, By: Prudential Investment Management, Inc., as attorney -in-fact. By: /s/ Jill Baum --------------- Name: Jill Baum Title: Vice President. S-16 FLAGSHIP CLO II, By: /s/ [ILLEGIBLE] ----------------- Name: [ILLEGIBLE] Title: As attorney in Fact S-17 FLAGSHIP CLO-2001-1, By: Flagship Capital Mgt, Inc By: /s/ [ILLEGIBLE] ----------------- Name: [ILLEGIBLE] Title: Director S-18 FRANKLIN CLO II, LIMITED, as Documentation Agent and a Lender By: /s/ [ILLEGIBLE] ----------------- Name: Title: S-20 FRANKLIN FLOATING RATE DAILY ACCESS FUND By: /s/ [ILLEGIBLE] ----------------- Name: Title: S-21 FRANKLIN FLOATING RATE MASTER SERIES, By: /s/ [ILLEGIBLE] ----------------- Name: Title: S-22 FRANKLIN FLOATING RATE TRUST, By: /s/ [ILLEGIBLE] ----------------- Name: Title: S-23 GMAC BUSINESS CREDIT, LLC, as a Lender By: /s/ Mathew Leighton --------------------- Name: Mathew Leighton Title: Vice President S-24 Sankaty Advisors, LLC as Collateral Manager for Great Point CLO 1999-1 LTD., as Term Lender By: /s/ Diane J. Exter --------------------- Name: DIANE J. EXTER Title: MANAGING DIRECTOR PORTFOLIO MANAGER S-25 HARBOUR TOWN FUNDING TRUST By: /s/ Ann E. Morris ------------------- Name: ANN E. MORRIS Title: AUTHORIZED AGENT S-27 JUPITER FUNDING TRUST, as a Lender By: /s/ Ann E. Morris ------------------- Name: ANN E. MORRIS Title: AUTHORIZED AGENT S-29 KZH CNC LLC By: /s/ Anthony Iarrobino ----------------------- Name: ANTHONY IARROBINO Title: AUTHORIZED AGENT S-30 ENDURANCE CLO 1, LTD., by: ING Capital Advisors LLC, as Portfolio Manager By: /s/ John J. D'Angelo ---------------------- Name: John J. D'Angelo Title: Vice President KZH ING-2 LLC By: ---------------------- Name: Title: KZH ING-3 LLC By: ---------------------- Name: Title: S-31 KZH ING-1 LLC By: ---------------------- Name: Title: KZH ING-2 LLC By: ---------------------- Name: Title: KZH ING-3 LLC By: /s/ Anthony Iarrobino ---------------------- Name: ANTHONY IARROBINO Title: AUTHORIZED AGENT S-31 KZH PONDVIEW LLC By: /s/ Anthony Iarrobino ------------------------ Name: ANTHONY IARROBINO Title: AUTHORIZED AGENT KZH RIVERSIDE LLC By: ------------------------ Name: Title: KZH WATERSIDE LLC By: ------------------------ Name: Title: S-32 KZH PONDVIEW LLC By: ------------------------ Name: Title: KZH RIVERSIDE LLC By: /s/ Anthony Iarrobino ------------------------ Name: ANTHONY IARROBINO Title: AUTHORIZED AGENT KZH WATERSIDE LLC By: ---------------------- Name: Title: AMENDMENT TO CREDIT AND GUARANTY AGREEMENT EXECUTION S-32 KZH PONDVIEW LLC By: ---------------------- Name: Title: KZH RIVERSIDE LLC By: ---------------------- Name: Title: KZH WATERSIDE LLC By: /s/ Anthony Iarrobino ---------------------- Name: ANTHONY IARROBINO Title: AUTHORIZED AGENT S-32 LAGUNA FUNDING TRUST By: /s/ Ann E. Morris ---------------------- Name: ANN E. MORRIS Title: AUTHORIZED AGENT S-33 LONG LANE MASTER TRUST IV, By: Fleet National Bank as Trust Administrator By: /s/ [ILLEGIBLE] ---------------------- Name: [ILLEGIBLE] Title: S-36 NEMEAN CLO, LTD., by: ING Capital Advisors LLC, as Investment Manager By: /s/ John J. D'Angelo --------------------- Name: John J. D'Angelo Title: Vice President S-39 ING-ORYX CLO, LTD., by: ING Capital Advisors LLC, as Collateral Manager By: /s/ John J. D'Angelo --------------------- Name: John J. D'Angelo Title: Vice President S-43 ING PRIME RATE TRUST, by: ING Pilgrim Investments, LLC as its investment Manager (Taxpayer ID # 95 ###-###-####). By: /s/ Brian S. Horton --------------------- Name: Britan S. Horton Title: Vice President S-44 ING SENIOR INCOME FUND, by: ING Pilgrim Investments, LLC as its investment Manager (Taxpayer ID # 95 ###-###-####). By: /s/ Brian S. Horton --------------------- Name: Brian S. Horton Title: Vice President S-45 Sankaty Advisors, LLC as Collateral Manager for Race Point CLO, Limited, as Term Lender By: /s/ Diane J. Exter ` ---------------------- Name: Diane J. Exter Title: MANAGING DIRECTOR PORTFOLIO MANAGER S-47 RIVIERA FUNDING LLC, By: /s/ Ann E. Morris ---------------------- Name: ANN E. MORRIS Title: ASST. VICE PRESIDENT S-48 Sankaty High Yield Partners III. L.P By: /s/ Diane J. Exter -------------------- Name: DIANE J. EXTER Title: MANAGING DIRECTOR PORTFOLIO MANAGER S-51 SENECA CBO IV, LIMITED, By: /s/ Charles Diche -------------------- Name: Charles Diche Title: Portfolio Manager S-53 SEQUILS-ING I (HBDGM), LTD., by: ING Capital Advisors LLC, as Collateral Manager By: /s/ John J. D'Angelo ----------------------- Name: John J. D'Angelo Title: Vice President S-56 SKM-LIBERTYVIEW CBO I LIMITED, By: /s/ Kenneth C. Klegar ----------------------- Name: Kenneth C. Klegar Title: Authorized Signatory S-58 STEIN ROE FLOATING RATE LIMITED LIABILITY COMPANY, By: /s/ James R. Fellows ---------------------- Name: James R. Fellows Title: Senior Vice President Stein Roe & Famham Incorporated, as Advisor to the Stein Roe Floating Rate Limited Liability Company S-60 SWISS LIFE US RAINBOW LIMITED, by: ING Capital Advisors LLC, as Investment Manager By: /s/ John J. D'Angelo ---------------------- Name: John J. D'Angelo Title: Vice President S-61 THE ING CAPITAL SENIOR SECURED HIGH INCOME HOLDINGS FUND, LTD., by: ING Capital Advisors LLC, as Investment Manager By: /s/ John J. D'Angelo ----------------------- Name: John J. D'Angelo Title: Vice President S-63 THE PROVIDENT BANK, By: /s/ Christopher B. Gribble ---------------------------- Name: CHRISTOPHER B. GRIBBLE Title: VICE PRESIDENT S-64 TORONTO DOMINION (NEW YORK), INC., By: /s/ Susan K. Strong --------------------- Name: Susan K. Strong Title: Vice President S-65 TRANSAMERICA BUSINESS CAPITAL CORPORATION, By: /s/ Stephen K. Goetschius --------------------------- Name: Stephen K. Goetschius Title: Senior Vice President S-66 VAN KAMPEN SENIOR INCOME TRUST By: Van Kampen Investment Advisory Corp. By: /s/ Darvin D. Pierce ----------------------- Name: DARVIN D. PIERCE Title: EXECUTIVE DIRECTOR S-2 VAN KAMPEN PRIME RATE INCOME TRUST, By: /s/ Darvin D. Pierce ---------------------- Name: DARVIN D. PIERCE Title: EXECUTIVE DIRECTOR S-3 VAN KAMPEN SR FLOATING RATE FUND, By: /s/ Darvin D. Pierce ---------------------- Name: DARVIN D. PIERCE Title: EXECUTIVE DIRECTOR S-4 WINGED FOOT FUNDING TRUST, By: /s/ Ann E. Morris ------------------- Name: ANN E. MORRIS Title: AUTHORIZED AGENT S-70