**Exhibit10 (i)**

 

AMENDMENT TO AMENDED ANDRESTATED CREDIT AGREEMENT

 

THIS AMENDMENT TOAMENDED AND RESTATED CREDIT AGREEMENT (the “Amendment”), dated as ofMay 29, 2003, is entered into by and between FAMILY DOLLAR STORES, INC., aDelaware corporation (“FDSI”), FAMILY DOLLAR, INC., a North Carolinacorporation (“FDI”) (FDSI and FDI are collectively referred to herein asthe “Borrower”) and BANK OF AMERICA, N.A. (the “Bank”).

 

RECITALS

 

The Borrower andthe Bank are parties to an Amended and Restated Credit Agreement dated as ofMay 31, 2001 (as amended prior to the date hereof, the “Credit Agreement”)pursuant to which the Bank has extended certain credit facilities to theBorrower.

 

In accordance withSections 2.14 and 2.15 of the Credit Agreement, the Borrower has requested theBank to agree to extensions of the Tranche A Termination Date and the Tranche BTermination Date.

 

The Bank iswilling to amend the Credit Agreement to extend the Tranche A Termination Dateand the Tranche B Termination Date, subject to the terms and conditions of thisAmendment.

 

NOW, THEREFORE,for valuable consideration, the receipt and adequacy of which are herebyacknowledged, the parties hereto hereby agree as follows:

 

1.                                       DefinedTerms.  Unless otherwise definedherein, capitalized terms used herein shall have the meanings, if any, assignedto them in the Credit Agreement.

 

2.                                       Amendmentsto Credit Agreement.

 

(a)                                  Section1.01 of the Credit Agreement is amended by amending the following definitionsto read in their entirety as follows:

 

(1)                                  “TrancheA Commitment” means the obligation of the Bank to make Tranche A Loanshereunder in an aggregate principal amount up to but not exceeding FiftyMillion Dollars ($50,000,000.00), as the same may be reduced pursuant toSections 2.01(c) and 2.12 or terminated pursuant to Section 2.12.

 

(2)                                  “TrancheA Termination Date” means May 31, 2005, or such earlier date as the TrancheA Commitment is terminated pursuant to this Agreement.

 

(3)                                  “TrancheB Commitment” means the obligation of the Bank to make Tranche B Loanshereunder in an aggregate principal amount up to but not

 

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exceeding Fifty Million Dollars ($50,000,000.00), asthe same may be reduced or terminated pursuant to Section 2.12.

 

(4)                                  “TrancheB Termination Date” means May 27, 2004, or such earlier date as the TrancheB Commitment is terminated pursuant to this Agreement.

 

(b)                                 Section2.01(c) of the Credit Agreement is amended to read in its entirety as follows:

 

(c)                                  Subjectto the terms and conditions of this Agreement, at any time and from time totime on any Business Day on or before the Tranche A Termination Date, theBorrower may convert all or a portion of the Tranche A Loans then outstandinginto a Term Loan (each a “Term Loan”) with a maturity of Five (5)years.  The Borrower shall give the Bankat least five (5) Business Days prior written notice of each such conversionspecifying the date of the conversion (the “Term Loan Conversion Date”),the principal amount of the Term Loan, whether installments of principal of theLoan will be payable quarterly or semiannually after the Second Anniversary forsuch Term Loan and the term of such Term Loan. Each Term Loan shall be in a minimum principal amount of $5,000,000 orincrements of $100,000 above such amount, except for the last Term Loan, whichmay be less than such amount. Effective as of each Term Loan Conversion Date,the Tranche A Commitment shall be irrevocably reduced by the aggregateprincipal amount of the Tranche A Loans converted into a Term Loan on suchdate.

 

(c)                                  Section2.03(c) of the Credit Agreement is amended to read in its entirety as follows:

 

(c)                                  Inthe event that the Borrower converts all or a portion of the Tranche A Loansinto a Term Loan in accordance with Section 2.01(c), the Borrower shall pay tothe Bank the entire principal amount of such Term Loan as follows:

 

(A)  installments of principal each in an amountequal to one-fifth of the original principal amount of such Term Loan shall bepayable on the First Anniversary and Second Anniversary of such Term Loan, and(B) thereafter (x) if the Borrower has notified the Bank pursuant to Section2.01(c) that after the Second Anniversary installments of principal will bepayable quarterly, installments of principal shall be payable in twelve (12)equal, consecutive quarterly installments each in a principal amount equal toone twelfth (1/12th) of the then outstanding principal amount of such Term Loanon the Second Anniversary after giving effect to the scheduled payment ofprincipal on such date, with the first such quarterly installment being payableon the date occurring three (3) months after the Second Anniversary andsubsequent like installments being payable every three (3) months thereafter,or (y) if the Borrower has notified the Bank pursuant to Section 2.01(c) thatafter the Second Anniversary installments of principal will be payablesemiannually, installments of principal shall be payable in six equal,consecutive semiannual installments each in a principal amount equal to onesixth (1/6th) of the then outstanding principal amount of such Term Loan aftergiving effect to the scheduled payment of principal on such date, with thefirst such semiannual installment being payable on the date occurring six (6)months after

 

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the Second Anniversary and subsequent likeinstallments being payable every six (6) months thereafter.

 

(d)                                 Section8.14 of the Credit Agreement is amended by adding at the end thereof thefollowing sentence:

 

Notwithstanding anything herein to the contrary,“Information” shall not include, and the Bank may disclose without limitationof any kind, any information with respect to the “tax treatment” and “taxstructure” (in each case, within the meaning of Treasury RegulationSection 1.6011-4) of the transactions contemplated hereby and allmaterials of any kind (including opinions or other tax analyses) that areprovided to the Bank relating to such tax treatment and tax structure; providedthat with respect to any document or similar item that in either case containsinformation concerning the tax treatment or tax structure of the transaction aswell as other information, this sentence shall only apply to such portions ofthe document or similar item that relate to the tax treatment or tax structureof the Loans and transactions contemplated hereby and providedfurther,that the Bank will give the Borrower reasonable prior notice of suchdisclosure.

 

(e)                                  TheAddress for Notices on page 32 of the Credit Agreement is amended in itsentirety as follows:

 

Address for Notices:

 

Bank of America, N.A.901 Main StreetTX1-492-64-01Dallas, TX 75202-3714

 

Facsimile No.:  (214) 209-1286

 

Attention:  Portfolio Management - Retail

 

3.                                       Representationsand Warranties.  The Borrower herebyrepresents and warrants to the Bank as follows:

 

(a)                                  NoDefault or Event of Default has occurred and is continuing.

 

(b)                                 Theexecution, delivery and performance by the Borrower of this Amendment have beenduly authorized by all necessary corporate and other action and do not and willnot require any registration with, consent or approval of, notice to or actionby, any Person (including any Governmental Authority) in order to be effectiveand enforceable.  The Credit Agreementas amended by this Amendment constitutes the legal, valid and bindingobligations of the Borrower, enforceable against it in accordance with itsterms, except as limited by applicable Debtor Relief Laws and generalprinciples of equity, without defense, counterclaim or offset.

 

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(c)                                  Allrepresentations and warranties of the Borrower contained in the CreditAgreement are true and correct on and as of the date hereof.

 

4.                                       EffectiveDate.  This Amendment will becomeeffective as of May 29, 2003 (the “Effective Date”), providedthat each of the following conditions precedent is satisfied:

 

(a)                                  TheBank has received from the Borrower a duly executed original (or, if elected bythe Bank, an executed facsimile copy) of this Amendment, together with a dulyexecuted Guarantor Acknowledgment and Consent in the form attached hereto (the“Consent”).

 

(b)                                 Allrepresentations and warranties contained herein are true and correct as of theEffective Date.

 

5.                                       Reservationof Rights.  The Borroweracknowledges and agrees that the execution and delivery by the Bank of thisAmendment shall not be deemed to create a course of dealing or otherwiseobligate the Bank to enter into amendments under the same, similar or any othercircumstances in the future.

 

6.                                       Miscellaneous.

 

(a)                                  Exceptas herein expressly amended, all terms, covenants and provisions of the CreditAgreement are and shall remain in full force and effect and all referencestherein and in the other Loan Documents to such Credit Agreement shallhenceforth refer to the Credit Agreement as amended by this Amendment.  This Amendment shall be deemed incorporatedinto, and a part of, the Credit Agreement. This Amendment is a Loan Document.

 

(b)                                 ThisAmendment shall be binding upon and inure to the benefit of the parties heretoand to the Credit Agreement and their respective successors and assigns.  No third party beneficiaries are intended inconnection with this Amendment.

 

(c)                                  ThisAmendment shall be governed by and construed in accordance with the law of theState of North Carolina.

 

(d)                                 ThisAmendment may be executed in any number of counterparts, each of which shall bedeemed an original, but all such counterparts together shall constitute but oneand the same instrument.  Each of theparties hereto understands and agrees that this document (and any otherdocument required herein) may be delivered by any party thereto either in theform of an executed original or an executed original sent by facsimiletransmission to be followed promptly by mailing of a hard copy original, andthat receipt by the Bank or the Borrower of a facsimile transmitted documentpurportedly bearing the signature of the Bank or the Borrower, as applicable,shall bind the Bank or the Borrower with the same force and effect as thedelivery of a hard copy original.  Anyfailure by the Bank or the Borrower to receive the hard copy executed originalof such document shall not diminish the binding effect of receipt of the facsimiletransmitted executed original of such document which hard copy original was notreceived by the Bank or the Borrower, as applicable.

 

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(e)                                  ThisAmendment, together with the Credit Agreement, contains the entire andexclusive agreement of the parties hereto with reference to the mattersdiscussed herein and therein.  ThisAmendment supersedes all prior drafts and communications with respectthereto.  This Amendment may not beamended except in accordance with the provisions of Section 8.04 of theCredit Agreement.

 

(f)                                    Ifany term or provision of this Amendment shall be deemed prohibited by orinvalid under any applicable law, such provision shall be invalidated withoutaffecting the remaining provisions of this Amendment or the Credit Agreement,respectively.

 

(g)                                 Noticeof Final Agreement.  THIS WRITTENAMENDMENT, THE CREDIT AGREEMENT, THE OTHER LOAN DOCUMENTS, AND THE DOCUMENTSEXECUTED IN CONNECTION HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THEPARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, ORSUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

IN WITNESS WHEREOF, the parties hereto have executedand delivered this Amendment as of the date first above written.

 
| FAMILY DOLLAR STORES,  INC. | FAMILY DOLLAR , INC.             |
|-----------------------------|----------------------------------|
|                        |                             |
| By:                         | /s/                              | C. Martin Sowers |   | By: | /s/ | C. Martin Sowers |   |
| Name:                       | C. MARTIN SOWERS                 | Name: | C. MARTIN SOWERS |
| Title:                      | Senior Vice President -  Finance | Title: | Senior Vice President -  Finance |
|                        |                             |
|                        |                             |
|                        | BANK OF AMERICA, N.A.            |
|                        |                             |
|                        | By:                              | /s/  | Temple H. Abney |   |
|                        | Name:                            | Temple Abney |
|                        | Title:                           | Vice President |
|                             |                                  |  |  |  |  |  |  |  |  |  |

 

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GUARANTOR ACKNOWLEDGMENTAND CONSENT

 

Each of theundersigned Guarantors, each a guarantor with respect to the Borrower’sobligations under the Credit Agreement, hereby (i) acknowledges and consents tothe terms of and the execution, delivery and performance of the foregoingAmendment to Amended and Restated Credit Agreement (the “Amendment”)(without implying the need for any such acknowledgement or consent), and (ii)represents and warrants to the Bank that, both before and after giving effectto the Amendment, the Guaranty to which each of the undersigned is a partyremains in full force and effect as an enforceable obligation of suchGuarantor, in accordance with its terms, except as enforceability may belimited by applicable Debtor Relief Laws and general principles of equity,without defense, counterclaim or offset, provided that nothing hereinshall prevent the assertion of any such claim by separate suit or compulsorycounterclaim, and that it is in compliance with all of its covenants containedtherein.  Each Guarantor furtherrepresents that the execution, delivery and performance by such Person of thisAcknowledgement and Consent have been duly authorized by all necessarycorporate, partnership and other action and do not and will not require anyregistration with, consent or approval of, notice to or action by, any Person(including any Governmental Authority) in order to be effective andenforceable.  Each Guarantor remakes asof the Effective Date (as defined in the Amendment) all of the representationsand warranties made by it pursuant to the Guaranty to which the undersigned isa party.  Capitalized terms used hereinand not otherwise defined have the respective meanings defined in the CreditAgreement (as defined in the Amendment).

 

IN WITNESS WHEREOF, each of the undersigned hasexecuted this Acknowledgement and Consent by its duly authorized officers as ofthis 29th day of May, 2003.

 
|   | FAMILY DOLLAR SERVICES,  INC.   |
|--------|---------------------------------|
|   |                            |
|   | By:                             | /s/  | C. Martin Sowers |   |
|   | Name:                           |   | C. MARTIN SOWERS |
|   | Title:                          |   | Senior Vice President -  Finance |
|   |                            |
|   |                            |
|   | FAMILY DOLLAR  OPERATIONS, INC. |
|   |                            |
|   | By:                             | /s/  | C. Martin Sowers |   |
|   | Name:                           |   | C. MARTIN SOWERS |
|   | Title:                          |   | Senior Vice President -  Finance |
|   |                            |
|   |                            |
|   | FAMILY DOLLAR TRUCKING,  INC.   |
|   |                            |
|   | By:                             | /s/  | C. Martin Sowers |   |
|   | Name:                           |   | C. MARTIN SOWERS |
|   | Title:                          |   | Senior Vice President -  Finance |

 

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