1 AMENDMENT NO. 1 TO CREDIT AGREEMENT AMENDMENT No. 1 dated as of July 16, 1997 to the Credit Agreement dated as of April 9, 1997 (the "Credit Agreement") among WOOLWORTH CORPORATION, the BANKS party thereto, the CO-AGENTS party thereto, NATIONSBANK, N.A., as Documentation Agent, and THE BANK OF NEW YORK, as LC Agent, Administrative Agent and Swingline Bank. W I T N E S S E T H : WHEREAS, the parties hereto desire to amend Sections 5.07 and 5.08 of the Credit Agreement; NOW, THEREFORE, the parties hereto agree as follows: SECTION 1. Defined Terms; References. Unless otherwise specifically defined herein, each term used herein which is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement. Each reference to "hereof", "hereunder", "herein" and "hereby" and each other similar reference and each reference to "this Agreement" and each other similar reference contained in the Credit Agreement shall, after this Amendment becomes effective, refer to the Credit Agreement as amended hereby. SECTION 2. Amendments. (a) The figure "$1,000,000,000" in Section 5.07 is changed to "$800,000,000." (b) Section 5.08 is amended to read in its entirety as follows: SECTION 5.08. Leverage Ratio. Total Borrowed Funds will not exceed (i) 77% of Total Capitalization at any time from the Effective Date through the end of Fiscal Year 1997, (ii) 75% of Total Capitalization at any time thereafter through the end of Fiscal Year 1998 or (iii) 70% of Total Capitalization at any time thereafter. SECTION 3. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York. 2 SECTION 4. Counterparts. This Amendment may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. SECTION 5. Effectiveness. This Amendment shall become effective as of the date hereof when the Administrative Agent shall have received from each of the Borrower and the Required Banks a counterpart hereof signed by such party or facsimile or other written confirmation (in form satisfactory to the Administrative Agent) that such party has signed a counterpart hereof. 3 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written. WOOLWORTH CORPORATION By: /s/ John H. Cannon ---------------------------------- Title: Vice President - Treasurer MORGAN GUARANTY TRUST COMPANY OF NEW YORK By: /s/ Penelope J. B. Cox ---------------------------------- Title: Vice President NATIONSBANK, N.A. By: /s/ Marcus A. Boyer ---------------------------------- Title: Senior Vice President THE BANK OF NEW YORK By: /s/ Howard F. Bascom, Jr. ---------------------------------- Title: Vice President 4 THE BANK OF NOVA SCOTIA By: /s/ J. Alan Edwards ---------------------------------- Title: Authorized Signatory BANK OF TOKYO-MITSUBISHI TRUST COMPANY By: /s/ G. Stewart ---------------------------------- Title: Senior Vice President & Manager TORONTO DOMINION (NEW YORK), INC. By: /s/ David G. Parker ---------------------------------- Title: Vice President BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By: /s/ Jody A. Pritchard ---------------------------------- Title: Assistant Vice President 5 COMMERZANK AG, NEW YORK AND/OR GRAND CAYMAN BRANCHES By: /s/ Subash R. Viswanathan ---------------------------------- Title: Vice President By: /s/ A. Oliver Welsch-Lehmann ---------------------------------- Title: Assistant Treasurer CREDIT LYONNAIS NEW YORK BRANCH By: /s/ Vladimir Labun ---------------------------------- Title: First Vice President - Manager DEUTSCHE BANK AG, NEW YORK AND/OR CAYMAN ISLAND BRANCH By: /s/ Susan M. O'Connor ---------------------------------- Title: Director By: /s/ Joel D. Makowsky ---------------------------------- Title: Assistant Vice President 6 KEYBANK NATIONAL ASSOCIATION By: /s/ Karen A. Lee ---------------------------------- Title: Vice President WELLS FARGO BANK, N.A. By: /s/ Edith R. Lim ---------------------------------- Title: Vice President By: /s/ Gene Fuentes ---------------------------------- Title: Assistant Vice President UNION BANK OF CALIFORNIA, N.A. By: /s/ Cecilia M. Valente ---------------------------------- Title: Senior Vice President