02052003 8K Exhibit 10.6




FIFTH AMENDMENT TO CREDIT AGREEMENT

FIFTH AMENDMENT, dated as of January 30, 2003 (this
"Amendment"), to the Credit Agreement referred to below, is
entered into by and among GOTTSCHALKS INC., a Delaware corporation
("Borrower"); GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware
corporation (in its individual capacity, "GE Capital"),
for itself, as a Lender, and as Agent for Lenders; The CIT GROUP/BUSINESS
CREDIT, INC., as a Lender; LASALLE RETAIL FINANCE, a division of LASALLE
BUSINESS CREDIT, Inc, as agent for STANDARD FEDERAL BANK NATIONAL ASSOCIATION,
as a Lender; and FOOTHILL CAPITAL CORPORATION, as a Lender.

W I T N E S S E T H

WHEREAS, Borrower, Agent and Lenders are parties to that certain Credit
Agreement dated as of January 31, 2002 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement");

WHEREAS, Borrower, Agent and Lenders are parties to that certain Consent and
Fourth Amendment to Credit Agreement dated as of even date herewith (the
"Consent and Fourth Amendment"); capitalized terms not
otherwise defined herein shall have the meanings ascribed to them in the Credit
Agreement); 

WHEREAS, in order to induce Agent and Lenders to enter into the Consent and
Fourth Amendment, Borrower has agreed to execute and deliver this Amendment.

NOW THEREFORE, in consideration of the premises, and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:



	Annex A to the Credit Agreement is hereby amended by deleting the
definition of "Minimum Excess Availability" and replacing it with the
following:

""Minimum Excess Availability" means Ten Million Dollars
($10,000,000)."

	Annex G to the Credit Agreement is hereby amended by adding the
following new sentence to the end of subsection (a) thereto:

"For the sole purpose of testing compliance in January 2003, the amount
(not to exceed $3,500,000) paid in cash by Borrower in respect of the make-whole
premiums to be paid to the securitization certificate holders pursuant to the
terms of that certain Agreement Regarding Prepayment of Fixed Base Certificate
and those certain Agreements Regarding Prepayment of Variable Base Certificates
shall be added back into the EBITDA calculation."

	Representations and Warranties.  To induce Agent and Lenders to enter
into this Amendment, Borrower hereby represents and warrants that:

	The execution, delivery and performance by Borrower of this Amendment are
within Borrower's corporate power and have been duly authorized by all necessary
corporate and shareholder action.
	This Amendment has been duly executed and delivered by or on behalf of
Borrower.
	This Amendment constitutes a legal, valid and binding obligation of Borrower
enforceable against Borrower in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law).
	No Default has occurred and is continuing after giving effect to this
Amendment.
	No action, claim or proceeding is now pending or, to the knowledge of
Borrower, threatened against Borrower, at law, in equity or otherwise, before
any court, board, commission, agency or instrumentality of any federal, state,
or local government or of any agency or subdivision thereof, or before any
arbitrator or panel of arbitrators, (i) which challenges Borrower's right,
power, or competence to enter into this Amendment or, to the extent applicable,
perform any of its obligations under this Amendment, the Credit Agreement as
amended hereby or any other Loan Document, or the validity or enforceability of
this Amendment, the Credit Agreement as amended hereby or any other Loan
Document or any action taken under this Amendment, the Credit Agreement as
amended hereby or any other Loan Document or (ii) which if determined adversely,
is reasonably likely to have or result in a Material Adverse Effect after giving
effect to this Amendment.  To the knowledge of Borrower, there does not exist a
state of facts which is reasonably likely to give rise to such
proceedings.



	No Other Amendments.  Except as expressly amended herein, the Credit
Agreement shall be unmodified and shall continue to be in full force and effect
in accordance with its terms.

	Expenses.  Borrower hereby reconfirms its obligations pursuant to
Section 11.3 of the Credit Agreement to pay and reimburse Agent for all
reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) incurred in connection with the negotiation, preparation, execution and
delivery of this Amendment and all other documents and instruments delivered in
connection herewith. 

	Effectiveness.  This Amendment shall become effective as of January
30, 2003 (the "Amendment Effective Date") only upon
satisfaction in full in the judgment of the Agent of each of the following
conditions:


	Documents.  Agent shall have received this Amendment duly executed
and delivered by Agent, all Lenders and Borrower and consented and agreed to by
GCRC.

	Payment of Expenses.  Borrower shall have paid to Agent and Lenders
all costs, fees and expenses owing in connection with this Amendment and the
other Loan Documents and due to Agent or Lenders (including, without limitation,
reasonable legal fees and expenses), in each case to the extent billed to
Borrower or otherwise scheduled to be paid on or before the Amendment Effective
Date.

	Representations and Warranties.  All representations and warranties
of or on behalf of the Credit Parties or GCRC in this Amendment and all the
other Loan Documents shall be true and correct in all material respects with the
same effect as though such representations and warranties had been made on and
as of the date hereof and on and as of the date that the other conditions
precedent in this Section 8 have been satisfied.

	GOVERNING LAW.  THIS AMENDMENT SHALL BE GOVERNED BY, AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

	Counterparts.  This Amendment may be executed by the parties hereto
on any number of separate counterparts and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.

 

 

 

[Signature Page to Follow]


IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered as of the day and year first above written.
GOTTSCHALKS INC.

By:  /s/ James Famalette 

       Title:  President & CEO

  

GENERAL ELECTRIC CAPITAL

CORPORATION,

as Agent and Lender


By:  /s/ Todd Gronski

       Title:  Its Duly Authorized Signatory


THE CIT GROUP/BUSINESS CREDIT INC.,

as Lender


By:  /s/ Adrian Avalos

       Title:  Vice President

  

FOOTHILL CAPITAL CORPORATION,

as Lender


By:  /s/ Juan Barrera

       Title:  Assistant Vice President

  

LASALLE RETAIL FINANCE, a division of LASALLE BUSINESS CREDIT,
INC., as agent for STANDARD FEDERAL BANK NATIONAL ASSOCIATION N.A.,

as Lender


By:  /s/ Daniel O'Rourke

       Title:  Vice President  


[GCRC Fifth Amendment]












Acknowledgment, Consent and Agreement to Fifth Amendment to Credit
Agreement:

The undersigned hereby (i) acknowledges and consents to each of the
amendments to the Credit Agreement effected by this Amendment and (ii) confirms
and agrees that its obligations under the GCRC Letter shall continue without any
diminution thereof and shall remain in full force and effect on and after the
effectiveness of this Amendment.

Acknowledged, consented and agreed to as of January 30, 2003.
GOTTSCHALKS CREDIT RECEIVABLES CORPORATION, a Delaware corporation


 

By: /s/ Michael Geele

Title:  President