RECEIVABLES FACILITY); PLUS
(B)
CONSOLIDATED CAPITALIZED INTEREST OF SUCH PERSON AND ITS
RESTRICTED SUBSIDIARIES FOR SUCH PERIOD, WHETHER PAID OR ACCRUED; LESS
(C)
INTEREST INCOME FOR SUCH PERIOD.
For purposes of this definition, interest on a Capitalized Lease Obligation
shall be deemed to accrue at an interest rate reasonably determined by such
Person to be the rate of interest implicit in such Capitalized Lease Obligation
in accordance with GAAP.
For purposes of determining Consolidated Interest
Expense for any period ending prior to the first anniversary of the Closing
Date, Consolidated Interest Expense shall be $92.5 million for the fiscal
quarter ended January 28, 2006, $91.4 million for the fiscal quarter ended April
29, 2006 and $92.5
15
million for the fiscal quarter ended July 29, 2006; provided that the foregoing
amounts shall be subject to pro forma adjustment as contemplated by the
definition of "Fixed Charge Coverage Ratio" for relevant Specified Transactions
occurring after the Closing Date.
"Consolidated Net Income" means, with respect to any Person for any period, the
aggregate of the Net Income of such Person and its Restricted Subsidiaries for
such period, on a consolidated basis, and otherwise determined in accordance
with GAAP; provided, however, that, without duplication,
(A)
ANY AFTER-TAX EFFECT OF EXTRAORDINARY, NON-RECURRING OR UNUSUAL
GAINS OR LOSSES (LESS ALL FEES AND EXPENSES RELATING THERETO) OR EXPENSES,
TRANSACTION EXPENSES TO THE EXTENT INCURRED ON OR PRIOR TO DECEMBER 31, 2007,
SEVERANCE, RELOCATION COSTS, COSTS RELATED TO THE PERFECT STORE INITIATIVE,
HYBRID DISTRIBUTION NETWORK COSTS, PUBLIC COMPANY COSTS, INTEGRATION COSTS,
PRE-OPENING, OPENING, CONSOLIDATION AND CLOSING COSTS FOR FACILITIES (INCLUDING
STORES), SIGNING, RETENTION OR COMPLETION BONUSES, TRANSITION COSTS, COSTS
INCURRED IN CONNECTION WITH ACQUISITIONS AFTER THE CLOSING DATE, RESTRUCTURING
COSTS, SPECIFIED LEGAL EXPENSES AND CURTAILMENTS OR MODIFICATIONS TO PENSION AND
POST-RETIREMENT EMPLOYEE BENEFIT PLANS SHALL BE EXCLUDED,
(B)
THE NET INCOME FOR SUCH PERIOD SHALL NOT INCLUDE THE CUMULATIVE
EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLES DURING SUCH PERIOD,
(C)
ANY NET AFTER-TAX GAINS OR LOSSES ON DISPOSAL OF DISPOSED,
ABANDONED OR DISCONTINUED OPERATIONS SHALL BE EXCLUDED,
(D)
ANY AFTER-TAX EFFECT OF GAINS OR LOSSES (LESS ALL FEES AND
EXPENSES RELATING THERETO) ATTRIBUTABLE TO ASSET DISPOSITIONS OTHER THAN IN THE
ORDINARY COURSE OF BUSINESS, AS DETERMINED IN GOOD FAITH BY THE BORROWER, SHALL
BE EXCLUDED,
(E)
THE NET INCOME FOR SUCH PERIOD OF ANY PERSON THAT IS NOT A
SUBSIDIARY, OR IS AN UNRESTRICTED SUBSIDIARY, OR THAT IS ACCOUNTED FOR BY THE
EQUITY METHOD OF ACCOUNTING, SHALL BE EXCLUDED; PROVIDED THAT CONSOLIDATED NET
INCOME OF THE BORROWER SHALL BE INCREASED BY THE AMOUNT OF DIVIDENDS OR
DISTRIBUTIONS OR OTHER PAYMENTS THAT ARE ACTUALLY PAID IN CASH (OR TO THE EXTENT
CONVERTED INTO CASH) TO THE REFERENT PERSON OR A RESTRICTED SUBSIDIARY THEREOF
IN RESPECT OF SUCH PERIOD BY SUCH PERSON,
(F)
[RESERVED],
(G)
EFFECTS OF ADJUSTMENTS (INCLUDING THE EFFECTS OF SUCH ADJUSTMENTS
PUSHED DOWN TO THE BORROWER AND ITS RESTRICTED SUBSIDIARIES) IN THE MERCHANDISE
INVENTORY, PROPERTY AND EQUIPMENT, INTANGIBLE ASSETS, GOODWILL, DEFERRED REVENUE
AND DEBT LINE