Document:

<PAGE>
                                                                   Exhibit 10.23

                          KMART MANAGEMENT CORPORATION

                           RESTRICTED STOCK AGREEMENT

                                  JOHN GOODMAN

      THIS AGREEMENT, dated and effective as of January 2, 2004 (the "Grant
Date") by and between Kmart Management Corporation, a Michigan corporation (the
"Company"), and John Goodman (the "Executive"), is entered into as follows:

WHEREAS, the Company and the Executive are parties to an Employment Agreement
made and entered into on January 1, 2004 (the "Employment Agreement"); and

WHEREAS, the Compensation Committee of the Board of Directors of Kmart Holding
Corporation ("Holding Corp."), a Delaware corporation and the Company's parent
corporation, has determined that, as an inducement material to the Executive's
agreement to enter into employment with the Company, in satisfaction of the
Company's obligation under Section 6 of the Employment Agreement, and subject to
the restrictions stated below, the Executive should be granted shares of the
Holding Corp.'s $1.00 par value Common Stock (the "Restricted Stock");

NOW, THEREFORE, the parties hereby agree as follows:

1. Grant of Stock.

Pursuant to Section 6 of the Employment Agreement, the Executive is hereby
granted, effective on the Grant Date and subject to the terms and conditions of
this Agreement, 21,552 shares of Restricted Stock, said number of shares being
determined as follows: (a) the average of the highest ($24.00) and lowest
($22.41) fair market value of one share of Holding Corp. Common Stock on the
Grant Date is $23.20; and (b) 21,552 shares of Holding Corp. Common Stock, at a
fair market value of $23.20, would have a fair market value of $500,006.

2. Issuance of Stock

As soon as practicable, the Company shall cause the shares of Restricted Stock
to be issued in the Executive's name. The Restricted Stock shall be held in the
custody of the Company or its designee for the Executive's account. The
Restricted Stock shall be subject to the restrictions described herein. The
Restricted Stock shall bear appropriate legends with respect to the restrictions
described herein.

3. Vesting.

      (a) The interest of the Executive in the Restricted Stock shall vest as to
one-third of such Restricted Stock (7184 shares) at 12:01 a.m. on December 15,
2004, as to an additional one-third (7184 shares) at 12:01 a.m. on December 15,
2005, and as to the final one-third (7184 shares) at 12:01 a.m. on December 15,
2006, so as to be 100% vested at 12:01 a.m. on December 15, 2006, conditioned
upon the Executive's continued employment with the Company as of each vesting
date.
<PAGE>
      (b) Notwithstanding the foregoing, pursuant to and in accordance with the
terms, conditions and definitions of the Employment Agreement, the interest of
the Executive in the Stock shall vest as to 100% of the then unvested Restricted
Stock upon the Executive's termination of employment (i) without Cause (other
than due to disability or death), (ii) by reason of Constructive Termination, or
(iii) upon expiration of the Term of Employment following the Company's having
given a notice of non-extension of the Term of Employment.

4. Restrictions.

      (a) No portion of the Restricted Stock or rights granted hereunder may be
sold, transferred, assigned, pledged or otherwise encumbered or disposed of by
the Executive until such portion of the Restricted Stock becomes vested in
accordance with Section 3 of this Agreement. The period of time between the date
hereof and the date all Restricted Stock becomes vested is referred to herein as
the "Restriction Period."

      (b) If the Executive's employment with the Company is terminated for any
reason which does not give rise to 100% vesting of the Restricted Stock, as
provided in Section 3 above, the balance of the Restricted Stock subject to the
provisions of this Agreement which have not vested at the time of the
Executive's termination of employment shall be forfeited by the Executive, and
ownership transferred back to the Company.

5. Executive Shareholder Rights.

During the Restriction Period, the Executive shall have all the rights of a
shareholder with respect to the Restricted Stock except for the right to
transfer the Restricted Stock, as set forth in Section 4 of this Agreement.
Accordingly, the Executive shall have the right to vote the Restricted Stock and
to receive any cash dividends paid to or made with respect to the Restricted
Stock, provided, however, that dividends paid, if any, with respect to that
Restricted Stock which has not vested at the time of the dividend payment shall
be held in the custody of the Company and shall be subject to the same
restrictions that apply to the corresponding Restricted Stock.

6. Changes in Stock.

In the event that as a result of (a) any stock dividend, stock split or other
change in the Restricted Stock, or (b) any merger or sale of all or
substantially all of the assets or other acquisition of the Company or Holding
Corp., and by virtue of any such change, the Executive shall in his capacity as
owner of unvested shares of Restricted Stock which have been awarded to him (the
"Prior Stock") be entitled to new or additional or different shares or
securities, such new or additional or different shares or securities shall
thereupon be considered to be unvested Restricted Stock and shall be subject to
all of the conditions and restrictions which were applicable to the Prior Stock
pursuant to this Agreement.

7. Taxes.

The Executive shall be liable for any and all taxes, including withholding
taxes, arising out of this grant or the vesting of Restricted Stock hereunder.
The Executive may elect to satisfy such withholding tax obligation by having the
Company retain Restricted Stock having a fair market value equal to the
Company's minimum withholding obligation.

                                      -2-
<PAGE>
8. Miscellaneous.

      (a) The Company shall not be required (i) to transfer on its books any
shares of Restricted Stock which shall have been sold or transferred in
violation of any of the provisions set forth in this Agreement, or (ii) to treat
as owner of such shares or to accord the right to vote as such owner or to pay
dividends to any transferee to whom such shares shall have been so transferred.

      (b) The parties agree to execute such further instruments and to take such
action as may reasonably be necessary to carry out the intent of this Agreement.

      (c) Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon delivery to the Executive at his
address then on file with the Company.

      (d) This Agreement shall not be construed so as to grant the Executive any
right to remain in the employ of the Company.

      (e) The parties agree that: (i) this Restricted Stock Agreement and the
grant of Restricted Stock hereunder are in full and final satisfaction of the
Company's obligations under Section 6 of the Employment Agreement; (ii) the
Company shall have no further obligation to the Executive pursuant to Section 6
of the Employment Agreement except as stated herein; and (iii) neither the
Company nor Holding Corp. shall have any further obligation to the Executive
relating to the grant of stock except as stated herein.

      (f) This Agreement and the Employment Agreement constitute the entire
agreement of the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, the undersigned have executed this Agreement effective on
the date first set above.

EXECUTIVE                                   KMART MANAGEMENT CORPORATION

                                            By:
------------------------------------           ---------------------------------
John Goodman

                                      -3-<PAGE>
                                                                   Exhibit 10.24

                      SECOND AMENDMENT TO CREDIT AGREEMENT

            SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of December 22, 2003
(this "Amendment"), with respect to that certain Credit Agreement, dated as of
May 6, 2003 (as amended, the "Credit Agreement"), among Kmart Corporation, a
Michigan corporation ("Borrower"), the other Credit Parties (as defined therein)
signatory thereto, the lenders from time to time signatory thereto (each a
"Lender" and collectively, "Lenders") and General Electric Capital Corporation,
a Delaware corporation ("GE Capital"), as the administrative agent for the
Lenders (in such capacity, the "Administrative Agent").

                              W I T N E S S E T H:

            WHEREAS, Borrower, the other Credit Parties, Lenders and
Administrative Agent are parties to the Credit Agreement;

            WHEREAS, the Credit Parties have requested that the Lenders amend
the Credit Agreement to, among other things, (i) reduce the fees payable under
the terms of the Credit Agreement and (ii) modify certain covenants;

            WHEREAS, the Lenders are willing to agree to the requested
amendments on the terms and conditions contained herein;

            NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties agree as follows:

            1. Definitions. Unless otherwise defined herein, terms defined in
the Credit Agreement shall have their defined meanings when used herein.

            2. Amendments to Credit Agreement.

            (a) Section 1.3(a) of the Credit Agreement shall be amended to (i)
      delete the phrase "without penalty or premium (except as provided in
      Section 1.13(b) to the extent applicable)" in each instance where such
      phrase occurs therein and (ii) substitute therefor "without penalty or
      premium (except as provided in Section 1.9(d) and Section 1.13(b) to the
      extent applicable)".

            (b) Section 1.5(a) of the Credit Agreement shall be amended by (i)
      deleting the second and third paragraphs thereof in it its entirety and
      (ii) substituting the following in lieu thereof:

                  "During the period from the Second Amendment Effective Date
            through the Fiscal Quarter ending on or about July 31, 2004, the
            Applicable Margins shall be based on Level II (regardless of EBITDA
<PAGE>
            during such period). Thereafter, the Applicable Margins may be
            adjusted (up or down) by reference to each of the following grids:

<TABLE>
<CAPTION>
                                                                           LEVEL OF
                         IF LTM EBITDA IS:                            APPLICABLE MARGINS:
                         -----------------                            -------------------
<S>                                                                    <C>
                      (Less Than) $300,000,000                               Level I
(Greater Than or Equal To) $300,000,000 but (Less Than) $500,000,000        Level II
(Greater Than or Equal To) $500,000,000 but (Less Than) $600,000,000        Level III
              (Greater Than or Equal To) $600,000,000                       Level IV
</TABLE>

<TABLE>
<CAPTION>
                                  APPLICABLE MARGINS
                                  ------------------
                                         LEVEL I    LEVEL II    LEVEL III   LEVEL IV
                                         -------    --------    ---------   --------
<S>                                      <C>        <C>         <C>         <C>
Applicable Revolver Index Margin          1.75%       1.50%       1.25%      1.00%

Applicable Revolver LIBOR Margin          2.75%       2.50%       2.25%      2.00%

Applicable Revolving Standby L/C Margin   2.75%       2.50%       2.25%      2.00%

Applicable Revolving Documentary L/C
Margin                                    1.50%       1.25%       1.25%      1.25%

Applicable Synthetic L/C Margin           2.75%       2.50%       2.25%      2.00%
</TABLE>

            Any such adjustments in the Applicable Margins shall be implemented
quarterly on a prospective basis on the fifth (5th) day following the delivery
of Financial Statements in accordance with paragraphs (b) or (d), as applicable,
of Annex E evidencing the need for an adjustment. Concurrently with the delivery
of those Financial Statements, Borrower shall deliver to Administrative Agent
and Lenders a certificate, signed by a Financial Officer, setting forth in
reasonable detail the basis for the continuance of, or any change in, the
Applicable Margins (the "LTM EBITDA Certificate"). Failure to timely deliver
such Financial Statements shall, in addition to any other remedy provided for in
this Agreement, result in an increase in the Applicable Margins to the highest
level set forth in the foregoing grid, until the fifth (5th) day following the
delivery of those Financial Statements demonstrating that such an increase is
not required. If an Event of Default has occurred and is continuing at the time
any reduction in the Applicable Margins is to be implemented, that reduction
shall be deferred until the third (3rd) Business Day following the date on which
such Event of Default is waived or ceases to continue, as the case may be."

      (c)   Section 1.9(b) of the Credit Agreement shall be deleted in its
            entirety and the following shall be substituted in lieu thereof:

                  "(b) As additional compensation for the Revolving Lenders,
            Borrower shall pay to Administrative Agent, for the ratable benefit
            of such Revolving Lenders, in arrears, on the first Business Day of
            each month

                                       2
<PAGE>
            prior to the Commitment Termination Date, as required pursuant to
            Section 1.3(a) and on the Commitment Termination Date, a Fee for
            Borrower's non-use of available funds in an amount equal to the
            Applicable Unused Line Fee Percentage per annum multiplied by the
            difference between (x) the Revolving Maximum Amount (as it may be
            reduced from time to time) and (y) the average for the period of the
            daily closing balances of the Revolving Loan and the Swing Line Loan
            outstanding during the period for which such Fee is due (such fee,
            the "Unused Line Fee").

                  During the period from the Second Amendment Effective Date
            through the Fiscal Quarter ending on or about July 31, 2004, the
            Applicable Unused Line Fee Percentage shall be based on Level I
            (regardless of EBITDA during such period). Thereafter, the
            Applicable Unused Line Fee Percentage may be adjusted (up or down)
            by reference to each of the following grids:

<TABLE>
<CAPTION>
                                                               LEVEL OF
                                                          APPLICABLE UNUSED
          IF LTM EBITDA IS:                              LINE FEE PERCENTAGE:
          -----------------                              --------------------
<S>                                                      <C>
    (Less Than or Equal To) $500,000,000                         Level I
    (Greater Than or Equal To) $500,000,000                     Level II
</TABLE>

<TABLE>
<CAPTION>
                      APPLICABLE UNUSED LINE FEE PERCENTAGE
                      -------------------------------------
<S>                                                             <C>
          Level I                                               0.50%

          Level II                                              0.375%
</TABLE>

                  Any such adjustments in the Applicable Unused Line Fee
            Percentage shall be implemented quarterly on a prospective basis on
            the fifth (5th) day following the delivery of Financial Statements
            in accordance with paragraphs (b) or (d), as applicable, of Annex E
            evidencing the need for an adjustment. Concurrently with the
            delivery of those Financial Statements, Borrower shall deliver to
            Administrative Agent and Lenders an LTM EBITDA Certificate, setting
            forth in reasonable detail the basis for the continuance of, or any
            change in, the Applicable Unused Line Fee Percentage. Failure to
            timely deliver such Financial Statements shall, in addition to any
            other remedy provided for in this Agreement, result in an increase
            in the Applicable Unused Line Fee Percentage to the highest level
            set forth in the foregoing grid, until the fifth (5th) day following
            the delivery of those Financial Statements demonstrating that such
            an increase is not required. If an Event of Default has occurred and
            is continuing at the time any reduction in the Applicable Unused
            Line Fee Percentage is to be implemented, that reduction shall be

                                       3
<PAGE>
            deferred until the third (3rd) Business Day following the date on
            which such Event of Default is waived or ceases to continue, as the
            case may be."

            (d) Section 1.9 of the Credit Agreement shall be amended to add the
      following new clause (d):

                  "(d) Upon any voluntary reduction or termination, as the case
            may be, in the Revolving Loan Commitments pursuant to Section 1.3
            after the Second Amendment Effective Date, Borrower shall pay to
            Administrative Agent, for the ratable benefit of the Revolving
            Lenders, a prepayment penalty in the amount equal to (i) 1.00% of
            the amount so reduced or terminated, as the case may be, to the
            extent it reduces the total Revolving Loan Commitments to less than
            $1,500,000,000 and such reduction or termination, as the case may
            be, occurs on or prior to June 30, 2004 or (ii) 1.00% of the amount
            so reduced or terminated, as the case may be, to the extent it
            reduces the total Revolving Loan Commitments to less than
            $1,000,000,000 and such reduction or termination, as the case may
            be, occurs after July 1, 2004 and on or prior to December 31, 2004."

            (e) Section 6.2(j) of the Credit Agreement shall be amended to (i)
      delete the reference to "clauses (k) or (l) below" and (ii) substitute in
      lieu thereof a reference to "clauses (k), (l) or (m) below".

            (f) Section 6.2(k) of the Credit Agreement shall be deleted in it
      its entirety and the following shall be substituted in lieu thereof:

                  "(k) During any Fiscal Quarter, Borrower and its Subsidiaries
            may use Surplus Cash as calculated for the immediately preceding
            Fiscal Quarter (to the extent not otherwise utilized pursuant to
            clause (j) above or clauses (l) or (m) below), Indebtedness
            permitted under Section 6.3, the cash proceeds of any issuance of
            Stock of Holdings and Stock of Holdings to make Investments
            constituting Permitted Acquisitions; provided that (i) no Default or
            Event of Default has occurred and is continuing at the time of such
            Investment (or would result therefrom), (ii) the total consideration
            in the aggregate during the term of the Agreement to be paid by
            Borrower or any of its Subsidiaries (including (other than
            Acquisition Indebtedness) any (x) Indebtedness issued or incurred by
            Borrower or its Subsidiaries (other than the Acquired Entity)
            pursuant to Section 6.3 in connection therewith (the amount thereof
            to be calculated in accordance with GAAP), (y) the Market Value of
            any Stock of Holdings issued in connection therewith and (z) the
            cash proceeds of any issuance of Stock of Holdings (the amount of
            any consideration referred to in clauses (y) and (z), collectively
            the "Stock Consideration")) in connection with Acquisitions pursuant
            to this clause (k) (the "Total Consideration") shall not exceed

                                       4
<PAGE>
            $1,750,000,000 in the aggregate during the term of this Agreement
            (as such amount may be increased or decreased as provided below, the
            "Total Consideration Basket") (provided that (1) in no event may the
            Total Consideration less the Stock Consideration for all such
            Investments exceed $750,000,000 in the aggregate during the term of
            this Agreement (as the same may be increased or decreased as
            provided below, the "Cash Consideration Basket") and (2) in no event
            may the Stock Consideration for all such Investments exceed
            $1,000,000,000 in the aggregate during the term of this Agreement
            (as the same may be decreased as provided below, the "Stock
            Consideration Basket")), and (iii) no Inventory acquired pursuant to
            any Permitted Acquisition shall become eligible for inclusion in the
            Borrowing Base until Administrative Agent has completed an appraisal
            and audit thereof (both at Borrower's expense and upon its request)
            and approved such inclusion in writing as determined by
            Administrative Agent in its sole and absolute discretion; provided,
            further, that in the event that LTM EBITDA is equal to or greater
            than $600,000,000 as evidenced in an LTM EBITDA Certificate, the
            Total Consideration Basket shall be increased to $2,000,000,000 and
            the Cash Consideration Basket shall be increased to $1,000,000,000;
            provided, further, that if subsequent to any such increase LTM
            EBITDA is less than $600,000,000 as evidenced in an LTM EBITDA
            Certificate, the Total Consideration Basket shall be reduced to the
            greater of $1,750,000,000 or the amount actually spent pursuant to
            the immediately preceding proviso and the Cash Consideration Basket
            shall be reduced to the greater of $750,000,000 or the amount
            actually spent or deemed spent under the Cash Consideration Basket
            pursuant to the immediately preceding proviso; and provided,
            further, that in the event that following any Acquisition pursuant
            to this clause (k) Borrower or any of its Subsidiaries makes any
            Asset Transfer to any Stock Acquisition Subsidiary to the extent
            permitted by clauses (f) and (g) above, then the Asset Transfer
            Amount in respect thereof shall (i) first be deducted from the Stock
            Consideration Basket less amounts spent or deemed spent under the
            Stock Consideration Basket pursuant to this clause (k) and (ii)
            then, to the extent that the Stock Consideration Basket has been
            reduced to zero, be deducted from the Cash Consideration Basket less
            amounts spent or deemed spent under the Cash Consideration Basket
            pursuant to this clause (k);"

            (g) Section 6.2 of the Credit Agreement shall be amended to (i)
      renumber clause (l) as clause "(m)", (ii) insert the following new clause
      immediately following clause (k) and immediately preceding the renumbered
      clause (m):

                  "(l) During any Fiscal Quarter, Borrower and its Subsidiaries
            may use Surplus Cash as calculated for the immediately preceding
            Fiscal

                                       5
<PAGE>
            Quarter (to the extent not otherwise utilized pursuant to clauses
            (j) or (k) above or (m) below) to (i) make deposits with finance
            companies, suppliers, insurers, vendors and other third parties that
            provide goods or services to the Credit Parties or their vendors and
            suppliers in the ordinary course of business and (ii) make
            Investments in any securities, Indebtedness, assets or other
            interests, in each case, that directly relate to real property owned
            or leased by any of the Credit Parties; provided, that not more than
            $500,000,000 of Surplus Cash in the aggregate during the term of
            this Agreement may be used for such deposits pursuant to this clause
            (l); and"

            (h) Section 6.7 of the Credit Agreement shall be amended to (i)
      delete the phrase "and, with respect to clause (b), Liens created under
      the Leasehold Subordination Arrangements and Permitted Liens" in the first
      sentence thereof and (ii) insert the following new phrase in lieu thereof:

            "Liens constituting deposits permitted pursuant to Section 6.2(l),
and, with respect to clause (b), Liens created under the Leasehold Subordination
Arrangements and Permitted Liens".

            (i) Section 6.13 of the Credit Agreement shall be amended to (i)
      delete the "and" that appears after the final ";" of clause (g), (ii)
      delete the "." that appears at the end of clause (h) and to substitute ";
      and" in lieu thereof, and (iii) insert the following new clause (i)
      immediately following clause (h):

                  "(i) the payment by the Credit Parties of up to $250,000,000
            of Surplus Cash as calculated for the immediately preceding Fiscal
            Quarter (to the extent not otherwise utilized pursuant to clauses
            (j), (k), (l) or (m) of Section 6.2) in the aggregate during the
            term of this Agreement to purchase the unrestricted stock of
            Holdings freely traded on a national securities exchange; provided
            that in the event that LTM EBITDA is equal to or greater than
            $600,000,000 as evidenced in an LTM EBITDA Certificate, the
            limitation referred to above shall be increased to $500,000,000;
            provided, further, that if subsequent to any such increase LTM
            EBITDA is less than $600,000,000 as evidenced in an LTM EBITDA
            Certificate, the limitation shall be reduced to the greater of
            $250,000,000 or the amount actually spent pursuant to the
            immediately preceding proviso."

            (j) The definition of "Applicable Trigger" in Annex A to the Credit
      Agreement shall be deleted in its entirety and the following shall be
      substituted in lieu thereof:

                  "'Applicable Trigger' means (a) with respect to the period of
            January through July of any Fiscal Year, the sum of Excess
            Availability

                                       6
<PAGE>
            and Suppressed Availability shall be less than $400,000,000 for any
            day occurring during such period and (b) with respect to the period
            of August through December of any Fiscal Year, the sum of Excess
            Availability and Suppressed Availability shall be less than
            $250,000,000 for any day (or, during the months of October, November
            and December, for three (3) consecutive Business Days) occurring
            during such period.".

            (k) The definition of "Applicable Margins" in Annex A to the Credit
      Agreement shall be amended to (i) delete the phrase "the Applicable
      Revolving L/C Margin" and (ii) substitute in lieu thereof the phrase
      "Applicable Revolving Documentary L/C Margin, the Applicable Revolving
      Standby L/C Margin".

            (l) The definition of "Applicable Revolving L/C Margin" in Annex A
      to the Credit Agreement shall be deleted in its entirety.

            (m) Annex A to the Credit Agreement shall be amended by adding
      thereto each of the following new definitions in its proper alphabetical
      place:

                  "'Applicable Revolving Documentary L/C Margin' means, the per
            annum interest rate from time to time in effect and payable with
            respect to outstanding Revolving Loan Letter of Credit Obligations,
            as determined by reference to Section 1.5(a)."

                  "'Applicable Revolving Standby L/C Margin' means, the per
            annum interest rate from time to time in effect and payable with
            respect to outstanding Revolving Loan Letter of Credit Obligations,
            as determined by reference to Section 1.5(a)."

                  "'Applicable Unused Line Fee Percentage' means, the per annum
            interest rate from time to time in effect, as determined by
            reference to Section 1.9(b)."

                  "'Asset Transfer' means any transfer of assets, including
            cash, Cash Equivalents and Marketable Securities, whether by
            contribution or other means of transfer."

                  "'Asset Transfer Amount' means the fair market value or book
            value, whichever is greater, of any and all assets transferred
            pursuant to an Asset Transfer."

                  "'Cash Consideration Basket' has the meaning ascribed to it in
            Section 6.2(k)."

                  "'LTM EBITDA Certificate' has the meaning ascribed to it in
            Section 1.5(a)."

                                       7
<PAGE>
                  "'Second Amendment Effective Date' means December 22, 2003."

                  "'Stock Acquisition Subsidiary' means any entity or Person
            acquired or formed to acquire the assets, business, division or
            stock of another Person, the consideration for which acquisition
            consists of Stock Consideration."

                  "'Stock Consideration' has the meaning ascribed to it in
            Section 6.2(k).

                  "'Stock Consideration Basket' has the meaning ascribed to it
            in Section 6.2(k).

                  "'Suppressed Availability' means the positive difference of
            the Borrowing Base less the Maximum Amount."

                  "'Total Consideration' has the meaning ascribed to it in
            Section 6.2(k).

                  "'Total Consideration Basket' has the meaning ascribed to it
            in Section 6.2(k).

            (n) Paragraph (f) of Annex B to the Credit Agreement shall be
      amended to (i) delete the reference to "the Applicable Revolving L/C
      Margin" and (ii) substitute in lieu thereof a reference to "the Applicable
      Revolving Documentary L/C Margin or the Applicable Revolving Standby L/C
      Margin, as applicable,".

            (o) Paragraph (g) of Annex B to the Credit Agreement shall be
      amended to (i) delete the reference to ".25%" and (ii) substitute in lieu
      thereof a reference to "0.125%".

            (p) Paragraph (a) of Annex F to the Credit Agreement shall be
      deleted in it its entirety and the following shall be substituted in lieu
      thereof:

                  "(a) to Administrative Agent, on or prior to the fifth
            Business Day following the end of each Fiscal Month, a certificate
            signed by a Financial Officer setting forth the Liquidity Threshold
            for such fiscal week (the "Availability Certificate")."

            3. Representations and Warranties. In order to induce Administrative
Agent and Lenders to enter into this Amendment, the Credit Parties hereby
represent and warrant to Administrative Agent and Lenders that the
representations and warranties of the Credit Parties contained in the Credit
Agreement and the other Loan Documents are true and correct in all material
respects on and as of the date hereof (after giving effect

                                       8
<PAGE>
hereto), except where such representations and warranties expressly relate to an
earlier date in which case such representations and warranties were true and
correct in all material respects as of such earlier date.

            4. Conditions to Effectiveness. This Amendment shall be effective on
the date when the following conditions shall have occurred:

            (a) Administrative Agent shall have executed this Amendment and
      shall have received counterparts hereof, duly executed and delivered by
      each Credit Party and Lenders; and

            (b) Administrative Agent shall have received from Borrower an
      amendment fee in the amount of $1,500,000 for the ratable benefit of the
      Lenders as consideration for this Amendment.

            5. Reference to Credit Agreement. Upon the effectiveness of this
Amendment, each reference in the Credit Agreement to "this Agreement,"
"hereunder," or words of like or similar import shall mean and be a reference to
the Credit Agreement, as modified and amended by this Amendment.

            6. Adjustments. In the event that Borrower and the other Credit
Parties open twenty-five (25) or more Stores (net of Store closings) or close
twenty-five (25) or more Stores (net of Store openings), in either case after
the Second Amendment Effective Date (either circumstance, a "Store Change"),
then at the request of Borrower, Administrative Agent or any Lender, the parties
to the Credit Agreement shall, from time to time, enter into negotiations in
order to adjust (upward or downward) the LTM EBITDA levels set forth in Sections
1.5, 1.9, 6.2 and 6.13 of the Credit Agreement, as modified and amended by this
amendment, so as to equitably reflect the effect of such Store Change (or
subsequent changes to the number of Stores of 25 or more, but only with respect
to increments of additional 25 Stores)on the financial condition of Holdings and
its Subsidiaries.

            7. Acknowledgement and Consent. Each Credit Party by their execution
of this Amendment hereby:

            (a) acknowledges and consents to this Amendment; and

            (b) ratifies and confirms that all guaranties, assurances,
      obligations and liens under the Loan Documents are not released,
      diminished, impaired, reduced or otherwise adversely affected and agrees
      that the execution, delivery and performance of this Amendment shall not
      in any way affect such Person's obligations under any Loan Document to
      which such Person is a party, which obligations on the date hereof remain
      absolute and unconditional and are not subject to any defense, set-off or
      counterclaim whatsoever.

                                       9
<PAGE>
            8. Authorization and Consent. Each Lender executing this Amendment
has obtained the consent and approval of each Person from whom such consent or
approval is required in connection with this Amendment.

            9. Governing Law and Jurisdiction. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

            10. Expenses. Borrower agrees to pay and reimburse Administrative
Agent for all its reasonable costs and expenses incurred in connection with the
preparation and delivery of this Amendment, including, without limitation, the
reasonable fees and disbursements of counsel to Administrative Agent.

            11. Headings. Section headings in this Amendment are included herein
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.

            12. Counterparts. This Amendment may be executed by the parties
hereto in any number of separate counterparts (including by facsimile
transmission) and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.

            13. Successors and Assigns. This Amendment shall be binding upon and
inure to the benefit of Borrower and its successors and assigns, and upon
Administrative Agent and the Lenders and their respective successors and
assigns.

            14. Continuing Effect. Except as expressly amended hereby, the
Credit Agreement shall continue to be and shall remain in full force and effect
in accordance with its terms. This Amendment shall not constitute an amendment
or waiver of any provision of the Credit Agreement not expressly referred to
herein and shall not be construed as an amendment, waiver or consent to any
action on the part of Borrower that would require an amendment, waiver or
consent of Administrative Agent or the Lenders except as expressly stated
herein. This Amendment shall constitute a Loan Document.

            15. NO ORAL AGREEMENTS. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       10
<PAGE>
            IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed and delivered by their respective duly authorized officers as of the
day and year first above written.

                                    KMART CORPORATION,
                                    as a Borrower

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KMART HOLDING CORPORATION
                                    KMART MANAGEMENT CORPORATION
                                    BIG BEAVER DEVELOPMENT CORPORATION
                                    BIG BEAVER OF FLORIDA DEVELOPMENT, LLC
                                    BIG BEAVER OF GUAYNABO
                                    BLUELIGHT.COM, INC.
                                    BLUELIGHT.COM LLC
                                    KBL HOLDING INC.
                                    KMART CORPORATION OF ILLINOIS, INC.
                                    KMART EXPRESS LLC,
                                    KMART INTERNATIONAL SERVICES, INC.
                                    KMART OF FLORIDA LLC
                                    KMART STORES OF ILLINOIS LLC
                                    KMART OF MICHIGAN, INC.
                                    KMART OF NORTH CAROLINA LLC
                                    KMART OF NY HOLDINGS, INC.
                                    KMART OF OHIO LLC
                                    KMART STORES OF TEXAS LLC
                                    KMART OF WASHINGTON LLC
                                    KMART OVERSEAS CORPORATION
                                    KMART STORES OF INDIANA, INC.
                                    KMART STORES OF TNCP, INC.
                                    MEDIA MOMENTUM, INC.
                                    STI MERCHANDISING, INC.,
                                    as Credit Parties

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    TROY COOLIDGE NO. 1, LLC
                                    TROY COOLIDGE NO. 2, LLC
                                    TROY COOLIDGE NO. 3, LLC
                                    TROY COOLIDGE NO. 4, LLC
                                    TROY COOLIDGE NO. 5, LLC
                                    TROY COOLIDGE NO. 6, LLC
                                    TROY COOLIDGE NO. 7, LLC
                                    TROY COOLIDGE NO. 8, LLC
                                    TROY COOLIDGE NO. 9, LLC
                                    TROY COOLIDGE NO. 10, LLC
                                    TROY COOLIDGE NO. 11, LLC
                                    TROY COOLIDGE NO. 12, LLC
                                    TROY COOLIDGE NO. 13, LLC
                                    TROY COOLIDGE NO. 14, LLC
                                    TROY COOLIDGE NO. 15, LLC
                                    TROY COOLIDGE NO. 16, LLC
                                    TROY COOLIDGE NO. 17, LLC
                                    TROY COOLIDGE NO. 18, LLC
                                    TROY COOLIDGE NO. 19, LLC
                                    TROY COOLIDGE NO. 20, LLC
                                    TROY COOLIDGE NO. 21, LLC
                                    TROY COOLIDGE NO. 22, LLC
                                    TROY COOLIDGE NO. 23, LLC
                                    TROY COOLIDGE NO. 24, LLC

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KLC INC.,
                                    as a Credit Party

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KMART OF INDIANA
                                    KMART OF PENNSYLVANIA LP
                                    KMART OF TEXAS L.P.
                                    THE COOLIDGE GROUP LLC,
                                    as Credit Parties

                                    By:  KMART CORPORATION, its sole member,
                                         partner or general partner, as
                                         applicable

                                         By:
                                            ------------------------------------
                                         Name:
                                              ----------------------------------
                                         Title:
                                               ---------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KMART TRINIDAD, INC.
                                    as a Credit Party

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    MARIN ACCESS LLC,
                                    as a Credit Party

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    GENERAL ELECTRIC CAPITAL CORPORATION, as
                                    Administrative Agent, a Lender and Issuing
                                    Bank

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    FLEET RETAIL FINANCE, INC.,
                                    as a Lender and Issuing Bank

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    BANK OF AMERICA BUSINESS CREDIT,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    GMAC COMMERCIAL FINANCE LLC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    WELLS FARGO FOOTHILL LLC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    BANK ONE, NA,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    THE CIT GROUP - RETAIL FINANCE GROUP,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    CONGRESS FINANCIAL CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    NATIONAL CITY COMMERCIAL FINANCE, INC.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    MERRILL LYNCH CAPITAL,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    PB CAPITAL CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    TEXTRON FINANCIAL CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    TRANSAMERICA BUSINESS CAPITAL CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    UPS CAPITAL CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    AMSOUTH BANK,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    RZB FINANCE LLC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    WHITEHALL BUSINESS CREDIT CORPORATION,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    THE PROVIDENT BANK,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    SENIOR DEBT PORTFOLIO,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    GRAYSON & CO.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    EATON VANCE SENIOR INCOME TRUST,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    EATON VANCE INSTITUTIONAL SENIOR LOAN FUND,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    EATON VANCE CDO III, LTD.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    EATON VANCE CDO IV, LTD.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    COSTANTINUS EATON VANCE DCO V, LTD.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KZH ING-2 LLC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KZH CYPRESS TREE-1 LCC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    KZH STERLING LLC,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    AMERICAN EXPRESS CERTIFICATE COMPANY,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    IDS LIFE INSURANCE COMPANY,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    LONGACRE MASTER FUND, LTD.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    THE FOOTHILL GROUP, INC.,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    CITIGROUP INVESTMENTS CORPORATE LOAN FUND,
                                    INC., as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
<PAGE>
                                    UBS AG, STAMFORD BRANCH,
                                    as a Lender

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

            [SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}]]