Document:

Exhibit 4.2c First Supplemental Indenture

Exhibit 4.2c

FIRST SUPPLEMENTAL INDENTURE
(71⁄8% Senior Notes due 2019)
THIS FIRST SUPPLEMENTAL INDENTURE (this “First Supplemental Indenture”) is dated as of February 1, 2015, among BROWN SHOE COMPANY, INC., a New York corporation (the “Company”), each of the SUBSIDIARY GUARANTORS listed on Schedule I hereto (collectively, the “Subsidiary Guarantors”), the New Guarantor (as defined below) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, as trustee (the “Trustee”).  
W I T N E S S E T H:
WHEREAS, the Company and the Subsidiary Guarantors have heretofore executed and delivered to the Trustee an Indenture, dated as of May 11, 2011 (the “Indenture”), providing for the issuance of the Company’s 71⁄8% Senior Notes due 2019 (the “Notes”);
WHEREAS, Section 9.01 of the Indenture authorizes the Company, the Subsidiary Guarantors and the Trustee, together, to amend or supplement the Indenture, without notice to or consent of any Holder of the Notes, to provide for the assumption of a Guarantor’s obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Company’s or such Guarantor’s assets;
WHEREAS, Brown Group Retail, Inc., a Pennsylvania corporation (“BGR‐PA”), is a Guarantor;
WHEREAS, the Company has determined that it is in the best interest of the Company and the Restricted Subsidiaries to reorganize BGR‐PA as a Delaware limited liability company as permitted by Section 10.04 of the Indenture; 
WHEREAS, in order to effect such reorganization, BGR‐PA will be merged into BG Retail, Inc., a newly formed Delaware corporation (“BGR Corp.”), and immediately thereafter, BGR Corp. will convert to BG Retail, LLC, a Delaware limited liability company (the “New Guarantor”); and
WHEREAS, Section 10.04 of the Indenture requires that the New Guarantor assume all the obligations of BGR‐PA under the Indenture and its Note Guarantee pursuant to a supplemental indenture reasonably satisfactory to the Trustee; and
WHEREAS, the Company has delivered to the Trustee, (a) an Officers’ Certificate and an Opinion of Counsel pursuant to Section 9.06 of the Indenture, stating that the execution of this First Supplemental Indenture is authorized or permitted by the Indenture, that this First Supplemental Indenture constitutes valid and binding obligations of the Company and the Subsidiary Guarantors, subject to customary exceptions stated therein, and that all conditions precedent to the execution and delivery of this First Supplemental Indenture have been complied with and (b) a Board Resolution pursuant to Section 9.01 of the Indenture; and
WHEREAS, pursuant to Sections 9.01 and 9.06 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, the Guarantors, the New Guarantor and the 

Trustee mutually covenant and agree for the benefit of each other and for the equal and ratable benefit of the Holders of the Notes as follows:
1.Capitalized Terms.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2.Assumption.  The New Guarantor hereby assumes all the obligations of BGR‐PA under the Indenture and its Note Guarantee and agrees to be bound by the terms and provisions of the Indenture and Note Guarantee as if the New Guarantor was an original party thereto.

3.No Recourse Against Others.  No past, present or future director, officer, employee, partner, affiliate, beneficiary or stockholder of the New Guarantor, as such, shall have any liability for any obligations of the Company or any Guarantor under the Notes, any Guarantees, the Indenture or this First Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of the Notes, by accepting and holding a Note, waives and releases all such liability.  Such waiver and release are part of the consideration for the issuance of the Notes.  

4.New York Law to Govern.  The laws of the State of New York shall govern and be used to construe this First Supplemental Indenture.

5.Counterparts.  The parties may sign any number of copies of this First Supplemental Indenture.  Each signed copy shall be an original, but all of them together shall represent the same agreement.  The exchange of copies of this First Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this First Supplemental Indenture as to the parties hereto and may be used in lieu of the original First Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

6.Effect of Headings.  The Section headings herein are for convenience only and shall not affect the construction hereof.

7.The Trustee.  The Trustee makes no representations or warranties and shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this First Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Company, the Subsidiary Guarantors and the New Guarantor.  In entering into this First Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct or affecting liability of affording protections to the Trustee whether or not elsewhere herein so provided.  

8.FATCA. The Company hereby confirms to the Trustee that this First Supplemental Indenture has not resulted in a material modification of the Notes for Foreign Accounting Tax Compliance Act (“FATCA”) purposes.  The Trustee shall assume that no material modification for FATCA purposes has occurred regarding the Notes, unless the Trustee receives written notice of such modification from the Company.

9.Representations and Warranties.  The Company hereby represents, warrants, and certifies to the Trustee that (a) immediately after giving effect to the assumption by BGR‐PA’s obligations under the Indenture by the New Guarantor, no Default or Event of Default exists; and (b) the execution of this First Supplemental Indenture is authorized and permitted by the Indenture and constitutes the valid and binding obligation of the Company and the New Guarantor enforceable in accordance with its terms, subject to 

applicable (i) bankruptcy, insolvency, reorganization, receivership, moratorium or similar laws affecting or relating to the rights and remedies of creditors generally including, without limitation, laws relating to fraudulent transfers or conveyances, preferences and equitable subordination, (ii) general principles of equity (regardless of whether considered in a proceeding in equity or at law), and (iii) an implied covenant of good faith and fair dealing.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed on this 12th day of March, 2015, to be effective as of the date first above written.
BROWN SHOE COMPANY, INC.

By:     /s/ Kenneth H. Hannah                
Name: Kenneth H. Hannah
Title:      Senior Vice President and  Chief Financial Officer 

BENNETT FOOTWEAR GROUP, LLC
BROWN SHOE INTERNATIONAL CORP.
BUSTER BROWN & CO.
EDELMAN SHOE, INC.
SIDNEY RICH ASSOCIATES, INC.
BROWN SHOE COMPANY OF CANADA LTD
BG RETAIL, LLC

AS TO EACH OF THE FOREGOING:

By:     /s/ Kenneth H. Hannah                
Name: Kenneth H. Hannah
Title:      Senior Vice President and  Chief Financial Officer 

WELLS FARGO BANK,  NATIONAL ASSOCIATION,
as Trustee

By:     /s/ Julius R. Zamora                     
Name: Julius R. Zamora        
Title:   Vice President        

    
SCHEDULE I

GUARANTORS

Bennett Footwear Group, LLC
Brown Shoe International Corp.
Buster Brown & Co.
Edelman Shoe, Inc.
Sidney Rich Associates, Inc.
Brown Shoe Company of Canada LtdExhibit 10.3(b)(4) Comp Plan

Exhibit 10.3(b)(4)

BROWN SHOE COMPANY, INC.
INCENTIVE AND STOCK COMPENSATION PLAN OF 2011
PERFORMANCE AWARD AGREEMENT

THIS AWARD AGREEMENT, effective March 13, 2015, represents the grant of Performance Shares (“Shares”) (collectively, the "Award") by Brown Shoe Company, Inc. ("Company") to the Participant named below, who has been selected by the Compensation Committee of the Company's Board of Directors (the "Committee") to receive the Award with respect to the Performance Periods set forth below under the Company’s Incentive and Stock Compensation Plan of 2011 (the "Plan").  Subject to the key terms set forth below and the attached General Terms and Conditions (dated as of March 13, 2015), all of which constitute part of this Agreement, this Award provides:

Participant:    

Performance Award, being a combination of the 

Number of Performance Shares:    

Form of Payment:  Shares of Company stock

Performance Cycle:   The Company’s Fiscal Years 2015 through 2017

Performance Periods:  Four distinct performance periods:  fiscal 2015, fiscal 2016, fiscal 2017 and the three-year period of fiscal 2015 - 2017 with one-fourth of the target award allocated to each of fiscal 2015, fiscal 2016, fiscal 2017 and the three-year period of fiscal 2015 - 2017

Performance:  As approved by the Committee

Minimum Performance Level:  As approved by the Committee

Maximum Award Value:  200% of Target Award for each Performance Period

Performance Measure(s):  Cumulative Adjusted EPS and Company Sales Growth

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed effective as of the last date written below.

BROWN SHOE COMPANY, INC.

By:

Timothy J. Sutter
Director, Benefits & Compensation
Date:  

	
					
	Accepted:
	 
	 
	 
	 

	 
	Participant Signature
	 
	 
	 

	 
	 
	 
	 
	 

	Date:
	 
	 
	 
	 

Brown Shoe Company, Inc.
PERFORMANCE AWARD 2015 to 2017
General Terms and Conditions (as of March 12, 2015)  

The parties hereto agree as follows:

1.    Performance Period(s).  The Performance Period(s) shall be as specified on the executed cover page of this Award.

2.    Performance Measure(s).  The Performance Measure(s) shall be as specified on the executed coverage page of this Award.

3.    Value of Award.  The Award shall represent and have a Maximum Award Value as specified on the executed cover page of this Award.
 
4.    Earning the Award; Certification of Performance and Percent Earned.  The portion of the Award allocated to a Performance Period shall be “earned” following the end of such Performance Period, as of the date the Committee shall determine and certify: (a) whether the Minimum Performance Level (as set forth on Attachment A) has been satisfied; (b) and if so, the percent of the Award that has been earned in accordance with the Performance Payoff Profile (as set forth on Attachment A) (the “Percent Earned”), but in no event  more than the Maximum Award Value; and provided that the determinations pursuant to (a) and (b) shall be subject to the Committee’s right to exercise its discretion to reduce the Company’s level of performance based on the quality of earnings pursuant to Section 9 of the Plan.  All calculations as to the Performance Measures shall be adjusted (1) pursuant to Section 14.2 of the Plan and (2) to exclude all items of gain, loss or expense for the Performance Period determined to be extraordinary or unusual in nature or infrequent in occurrence or related to the disposal of a segment of a business or related to a change in accounting principle all as determined in accordance with applicable accounting standards established pursuant to generally accepted accounting principles. 

5.    Amount Payable and Payment of the Award.  
(a)    Unless this Award is sooner terminated in accordance with Section 5, an earned Award (as provided in Section 3) shall be payable within sixty (60) days following completion of the Performance Cycle.  Subject to Section 5(b) and in accordance with Section 5(c), this Award shall not be payable and shall be forfeited if Participant terminates employment with the Company prior to the date that the Award payment is made to the Participant.  

(b)     The amount payable to the Participant shall be determined by multiplying the Percent Earned by the Target Award specified on Attachment A, subject to the Committee’s right to exercise discretion as provided in Section 3. 

(c)    Unless otherwise specified on the executed cover page of this Award, payment of the earned Performance Shares shall be made in shares of the Company’s Common Stock (“Shares”).  

6.    Termination Provisions.  
(a)    If, pursuant to Section 3, the Committee certifies that the Minimum Performance Level has not been achieved, this Award shall immediately terminate and no longer be of any effect.  
(b)    If Participant’s employment is terminated during the Performance Period by reason of death, Disability, Retirement or Early Retirement, the Committee, in its sole discretion, shall determine whether the Participant (or Participant’s beneficiary in the event of death) shall be eligible to receive any payment under this Award.  If payment of this Award is approved by the Committee, such payment shall be pro-rated based on the number of full months of continued active employment by Participant during the Performance Cycle as a percent of the total number of months in the Performance Cycle; the amount payable shall be based on the Percent Earned; and payment shall be made pursuant to Section 4 at the same time as payment of other awards for the same Performance Cycle are made to other 

eligible participants who did not terminate employment during the Performance Cycle.  Notwithstanding the foregoing, in the event of Participant’s termination due to death or Disability, if approved by the Committee, such pro-rated payment may be made prior to expiration of the Performance Cycle, with calculation of and timing of the payment amount to be determined by the Committee.

(c)    Except as provided in subsection 5(b), a Participant shall be eligible for payment of the earned Award, as specified in Section 3, only if the Participant remains continuously employed by the Company from the date of this Agreement, through the end of the Performance Cycle and continuing thereafter until the date the Awards is actually paid.

7.    Dividends.  The Participant shall have no right to any dividends that may be paid with respect to Shares until any such shares are vested.

8.    Change in Control.  If a Participant is employed by the Company on the date of a Change in Control, subject to Article 13 of the Plan, unless otherwise specifically prohibited under applicable laws, or by the rules and regulations of any governing governmental agencies or national securities exchange, the Award shall be deemed to have been fully earned for the entire Performance Cycle and fully vested as of the effective date of the Change in Control; and based upon an assumed achievement of all relevant targeted performance goals, the Award shall be payable in the amounts or at the level provided by the above-referenced provisions of the Plan within thirty (30) days following the effective date of the Change in Control.  

9.    Recapitalization.  Subject to Section 4.2 of the Plan, in the event that there is any change in corporate capitalization, such as a stock split, or a corporate transaction, such as any merger, consolidation, separation including a spin-off, or other distribution of stock or property of the Company, any reorganization (whether or not such reorganization comes within the definition of such term in Code 368) or any partial or complete liquidation of the Company, such adjustment shall be made in the number and class and/or price of the  Shares subject to this Award, as may be determined to be appropriate and equitable by the Committee, in its sole discretion, to prevent dilution or enlargement of rights; provided, however, that the number of Performance Shares subject to this Award shall always be a whole number.

10.    Tax Withholding.  The Committee shall have the power and the right to deduct or withhold, or require the Participant or beneficiary to remit to the Company, an amount sufficient to satisfy Federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of the Award.  In satisfaction of such requirements, subject to the approval of the Committee, the Participant may elect, within an election period specified by the Company, to satisfy the withholding requirement, in whole or in part, by having the Company withhold from the payment of the Award: (a) Shares having a Fair Market Value on the date the tax is to be determined equal to the minimum statutory total tax which could be withheld on the transaction (“Withholding Amount”) from that portion of the Award that is payable in Shares, if any; and/or (b) cash equal to the Withholding Amount from that portion of the Award that is payable in cash, if any; or (c) a combination of (a) and (b).  All such elections shall be irrevocable, made in writing, signed by the Participant, and shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.
11.    Clawback.  Any payouts will be subject to recovery if it is determined that the Participant personally and knowingly engaged in practices that materially contributed to the circumstances that led to the restatement of the Company’s financial statements.  

12.    Nontransferability.  This Agreement, as well as the rights granted thereunder, may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution.  

13.    Administration.  
(a)    This Award and the rights of the Participant hereunder are subject to all terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for administration of the Plan.  It is expressly understood that the Committee is authorized to administer, construe, 

and make all determinations necessary or appropriate to the administration of the Plan and this Agreement, all of which shall be binding upon the Participant.  

(b)    If there is any inconsistency between the terms of this Award and the terms of the Plan, the Plan’s terms shall completely supersede and replace the conflicting terms of this Agreement.  All capitalized terms shall have the meanings ascribed to them in the Plan unless specifically set forth otherwise herein.  

14.    Miscellaneous
(a)    This Agreement shall not confer upon the Participant any right to continuation of employment by the Company, nor shall this Agreement interfere in any way with the Company’s right to terminate his or her employment at any time.
    
(b)    The Committee and/or the Company’s Board of Directors may terminate, amend, or modify the Plan; provided, however, that no such termination, amendment, or modification of the Plan may in any way adversely affect the Participant’s rights under this Agreement without the Participant’s written consent.

(c)    This Agreement shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

(d)    To the extent not preempted by Federal law, this Agreement shall be construed in accordance with and governed by the substantive laws of the State of Missouri without regard to conflicts of laws principles, which might otherwise apply.  Any litigation arising out of, in connection with, or concerning any aspect of the Plan or this Agreement shall be conducted exclusively in the State or Federal courts in Missouri.

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