<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
June 2, 1998
Wal-Mart Stores, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 001-06991 71-0415188
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(STATE OR OTHER (COMMISSION FILE NUMBER) (IRS EMPLOYER
JURISDICTION OF IDENTIFICATION NO.)
INCORPORATION)
702 S.W. 8th Street
Bentonville, Arkansas 72716
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code:
(501) 273-4000
<PAGE>
ITEM 5. OTHER EVENTS.
On June 2, 1998, Wal-Mart Stores, Inc. (the "Company") commenced an
underwritten offering (the "Offering") of $500,000,000 aggregate principal
amount of its Puttable Reset Securities PURSsm due June 1, 2018 (the "Bonds"),
which Bonds were offered and sold pursuant to the Company's Registration
Statement on Form S-3, Registration No. 33-53125 (the "1994 Registration
Statement") and the Company's Registration Statement on Form S-3 , Registration
Statement No. 333-52045 (the "1998 Registration Statement"), which offer and
sale the Company consummated on June 8, 1998. The purpose of this Current
Report on Form 8-K is: (i) to file with the Commission pursuant to the
provisions of Section 13(a) of the Securities Exchange Act of 1934, as amended,
the form of each Bond and the opinion of counsel to the Company relating to the
issuance of the Bonds and (ii) to incorporate by reference in the 1994
Registration Statement and in the 1998 Registration Statement, the form of the
Bond and such opinion of counsel.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
4.1 Form of the Company's 5.85% Puttable Reset Bond PURSsm due June 1,
2018.
5.1 Opinion of Hughes & Luce, L.L.P. as to the validity of the Bonds
(which includes the consent of Hughes & Luce, L.L.P.
23.1 Consent of Hughes & Luce, L.L.P. (included in Exhibit 5.1).
1
<PAGE>
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: June 8, 1998 WAL-MART STORES, INC.
By: /s/ John B. Menzer
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John B. Menzer,
Executive Vice President and
Chief Financial Officer
2
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
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4.1 Form of the Company's 5.85% Puttable Reset Bond PURSsm due June 1,
2018.
5.1 Opinion of Hughes & Luce, L.L.P. as to the validity of the Bonds
(which includes Exhibit 23.1, the consent of Hughes & Luce,
L.L.P.)
23.1 Consent of Hughes & Luce, L.L.P. (included in Exhibit 5.1).
3
<PAGE>
EXHIBIT 4.1
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FORM OF 5.85% PUTTABLE RESET BOND PURSSM DUE JUNE 1, 2018
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. __ CUSIP: 931142-BB8
$______________
WAL-MART STORES, INC.
Puttable Reset Securities PURSSM due June 1, 2018
WAL-MART STORES, INC., a corporation organized and existing under the
laws of the State of Delaware (hereinafter called the "Company," which term
shall include any successor entity), for value received, hereby promises to pay
to CEDE & CO. or registered assigns, the principal sum of _____________________
DOLLARS on June 1, 2018 (the "Final Maturity") at any office or agency
maintained for the purpose in the Borough of Manhattan, The City of New York,
New York or the City of Chicago, Illinois, which shall initially be the
corporate trust office of The First National Bank of Chicago, the Trustee under
the Indenture referred to on the reverse hereof, at One North State Street, 9th
floor, Chicago, Illinois 60602, in such coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public and
private debts, and to pay to the registered holder hereof, as hereinafter
provided, interest on said principal sum at the rate described below, in like
coin or currency, from the June 1 or the December 1 next preceding the date
hereof to which interest has been paid or duly provided for (unless the date
hereof is a June 1 or December 1 to which interest has been paid, in which case
from the date hereof, or unless the date hereof is on or prior to the first
payment of interest, in which case from June 8, 1998; provided, however, that if
the Company shall default in payment of the interest due on such June 1 or
December 1, then from the next preceding June 1 or December 1 to which interest
has been paid or, if no interest has been paid on the Bonds, from June 8, 1998)
semi-annually on June 1 and December 1 in each year, until payment of said
principal sum has been made or duly provided for. The interest so payable on
any June 1 or December 1 shall, subject to certain exceptions provided in the
Indenture, be paid to the person in whose name this Bond is registered at the
close of business on the next preceding May 15 or November 15, as the
<PAGE>
case may be (each, an "Interest Payment Record Date"). Payments of interest
shall be made at any office or agency referred to above, provided that, at the
option of the Company, payments of interest may be made by check mailed to the
registered address of the persons entitled thereto.
From and including June 8, 1998 to but excluding June 1, 2000,
interest shall accrue on the principal sum of this Bond at an annual rate equal
to 5.85%. On June 1, 2000 and on every second June 1 thereafter until and
including June 1, 2016 (each such biennial date, a "Reset Date"), the interest
rate on this Bond shall be reset so as to equal a fixed rate determined as
described on the reverse hereof, unless the Company is obligated to repurchase
this Bond on such date (or has previously done so) pursuant to the Put Option
referred to on the reverse hereof. Notwithstanding the foregoing, reset shall
be subject to the occurrence of a Market Disruption Event or a Failed
Remarketing as described on the reverse hereof.
This Bond has initially been issued in the form of a Global Security
(as defined on the reverse hereof), and the Company has initially designated The
Depository Trust Company ("DTC," which term shall include any successor) as the
Depositary for this Bond. For as long as this Bond or any portion hereof is
issued in such form, and notwithstanding the foregoing, all payments of
interest, principal and other amounts in respect of this Bond or such portion
(including payments pursuant to the Call Option and Put Option referred to on
the reverse hereof) shall be made to the Depositary or its nominee in accordance
with its Applicable Procedures (as defined on the reverse hereof), in the coin
or currency specified above and as further provided on the reverse hereof.
Notwithstanding the foregoing, if any payment of interest, principal
or other amount to be made in respect of this Bond (including any payment
pursuant to an exercise of the Call Option or Put Option) would otherwise be due
on a day that is not a business day, such payment may be made on the next
succeeding day that is a business day, with the same effect as if such payment
were made on the due date.
This Bond is continued on the reverse hereof and the additional
provisions there set forth shall for all purposes have the same effect as if set
forth at this place. Such provisions include, inter alia, the Call Option and
Put Option, interest rate reset mechanism and the definitions of certain terms
used on the face hereof.
This Bond shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by the
Trustee under the Indenture.
<PAGE>
IN WITNESS WHEREOF, WAL-MART STORES, INC. has caused this Instrument
to be executed in its corporate name by the signature of its Chairman of the
Board or its President, or a Vice Chairman or a Vice President of the Company,
manually or in facsimile, and a facsimile of its corporate seal to be imprinted
hereon and attested by the signature of its Secretary or one of its Assistant
Secretaries or its Treasurer or one of its Assistant Treasurers, manually or in
facsimile.
Dated: June 8, 1998
[CORPORATE SEAL] WAL-MART STORES, INC.
By:
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Name:
Title:
ATTEST:
By:
-----------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein referred to
in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF
CHICAGO as Trustee
By:
-------------------------------
Authorized Signatory
<PAGE>
[REVERSE OF BOND]
WAL-MART STORES, INC.
Puttable Reset Securities PURS(SM) due June 1, 2018
1. Indenture. (a) This bond is one of a duly authorized issue of
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debentures, notes or other evidence of indebtedness of the Company (hereinafter
called the "Securities") of the series hereinafter specified, all issued or to
be issued under and pursuant to an indenture dated as of April 1, 1991, as
amended (the "Indenture", which term has the meaning set forth in such
instrument), duly executed and delivered by the Company to The First National
Bank of Chicago, as Trustee (the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture reference is hereby made for a
description of the rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Securities.
(b) The Securities may be issued in one or more series, which
different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest (if any) at different rates, may be
subject to different redemption provisions (if any), may be subject to different
sinking, purchase or analogous funds (if any) and may otherwise vary as in the
Indenture provided. This bond is one of a series of the Securities designated
as the Puttable Reset Securities PURS(SM) due June 1, 2018 of the Company,
limited in aggregate principal amount to $500,000,000 (the "Bonds"). The Bonds
constitute a separate series of Securities under the Indenture.
(c) The provisions of this Bond (including those relating to the Call
Option and Put Option), together with the provisions of the Indenture, shall
govern the rights, obligations, duties and immunities of the holders hereof, the
Company and the Trustee with respect to this Bond, provided that, if any
provision of this Bond necessarily conflicts with any provision of the
Indenture, the provision of this Bond shall be controlling to the fullest extent
permitted under the Indenture.
(d) Terms used and not defined herein that are defined in the
Indenture shall have the respective meanings assigned thereto in the Indenture.
Unless the context requires otherwise, terms defined herein include the plural
as well as the singular and vice-versa, and the words "herein" and "hereof", and
words of similar import, refer to this Bond as a whole and not to any particular
paragraph or other subdivision.
2. Call Option. (a) Goldman, Sachs & Co., a New York limited
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partnership ("Goldman, Sachs & Co.", which term shall include any successor),
shall have the right to purchase, on each Reset Date, all of the Bonds
outstanding on such Reset Date (in whole and not in part), including this Bond,
from the registered holders thereof on such Reset Date (such right, the "Call
Option"), in each case at a price equal to 100% of the principal amount of the
Bonds purchased (the "Face Value") and subject to Goldman, Sachs & Co. giving
notice of its intention to purchase the outstanding Bonds as described below (a
"Call Notice"). Whether or not the Call Option is exercised with respect to any
Reset Date, the Company shall remain obligated to pay all accrued and unpaid
interest on this Bond, and interest that becomes payable on this Bond on the
applicable (or any prior) Reset Date shall be payable to the registered holder
of this Bond on the corresponding Interest Payment Record Date (as defined
below), as provided herein and in the Indenture.
<PAGE>
(b) To exercise the Call Option with respect to any Reset Date,
Goldman, Sachs & Co. must give a Call Notice to the registered holder of this
Bond no later than the tenth Market Day prior to such Reset Date, in the manner
described in paragraph 9 below. Subject to paragraph 5(a) below, in the event a
Call Notice is duly given with respect to any Reset Date, the registered holder
of this Bond on such Reset Date shall be obligated to sell this Bond to Goldman,
Sachs & Co., and Goldman, Sachs & Co. shall be obligated to purchase this Bond
from such holder, at the Face Value on such Reset Date. Each such sale and
purchase shall be effected through the facilities of the Depositary, with the
registered holder being deemed to have automatically tendered this Bond for sale
to Goldman, Sachs & Co. on the applicable Reset Date in accordance with the
Depositary's Applicable Procedures as provided in paragraph 5 below. The
registered holder's automatic tender of this Bond on any Reset Date shall be
subject to receipt of payment of the Face Value of this Bond as provided in
paragraph 5(a) below. Notwithstanding any exercise of the Call Option with
respect to this Bond, this Bond will remain outstanding until it otherwise
ceases to be outstanding pursuant to the Indenture. As used herein, "Market
Day" means a business day other than a day on which dealings in the U.S.
Treasury bond market are generally not being conducted.
(c) If the Call Option is exercised with respect to a particular Reset
Date, this Bond shall be subject to purchase by Goldman, Sachs & Co. on such
Reset Date as provided herein and subject to paragraph 5(a) below.
3. Put Option. (a) If Goldman, Sachs & Co. does not exercise the
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Call Option with respect to a particular Reset Date, the registered holder of
this Bond on such Reset Date shall have the right to require the Company to
repurchase this Bond (in whole and not in part) from such holder on such Reset
Date (such right, the holder's "Put Option") at a price equal to 100% of the
principal amount of this Bond repurchased (the "Put Price"), in the
circumstances described in the next paragraph. In the event the Put Option is
exercised, the Put Price shall be payable by the Company to the registered
holder of this Bond on the applicable Reset Date, whereas the accrued and unpaid
interest on this Bond that becomes payable on the applicable (or any prior)
Reset Date shall be payable by the Company to the registered holder of this Bond
on the corresponding Interest Payment Record Date, as provided herein and in the
Indenture. If for any reason payment of the Put Price is not made when due on
this Bond, the accrued interest from such Reset Date to the date such payment is
made would be payable by the Company as part of the Put Price for this Bond, to
the person entitled to receive the Put Price.
(b) On each Reset Date, the registered holder of this Bond on such
Reset Date shall be deemed to have exercised its Put Option automatically,
without any action on its part, for the full principal amount of this Bond held
of record by such holder on such Reset Date unless either (x) Goldman, Sachs &
Co. has duly given a Call Notice with respect to such Reset Date or (y) if
Goldman, Sachs & Co. does not exercise the Call Option with respect to such
Reset Date, (i) no later than 10:00 A.M. (New York City time) on the seventh
Market Day prior to such Reset Date, the registered holder of this Bond at the
time gives notice to the Trustee that such holder elects not to sell this Bond
to the Company on such Reset Date (a "Hold Notice") and (ii) such notice is
effective (an "Effective Hold Notice") under the 10% Requirement (as defined
below). A Hold Notice must be given in the manner described in paragraph 9
below. Consequently, with respect to this Bond on any Reset Date, if a Call
Notice is not duly given by Goldman, Sachs & Co. and an Effective Hold Notice is
not duly given by the applicable holder as provided above, the Company shall be
obligated to repurchase this Bond from the registered holder on such Reset
<PAGE>
Date, and the registered holder of this Bond on the Reset Date shall be
obligated to sell this Bond to the Company, at the Put Price on such Reset Date.
Any such sale and purchase shall be effected through the facilities of the
Depositary, with the registered holder of this Bond on the applicable Reset Date
being deemed (in the absence of an Effective Hold Notice) to have automatically
tendered this Bond in whole for sale to the Company on the applicable Reset
Date, all in accordance with the Depositary's Applicable Procedures as provided
in paragraph 5 below. Notwithstanding any exercise of the Put Option with
respect to this Bond, this Bond shall remain outstanding until it otherwise
ceases to be outstanding pursuant to the Indenture.
(c) Notwithstanding the foregoing, no Hold Notice for this Bond shall
be effective with respect to any Reset Date unless Hold Notices are duly given
with respect to such Reset Date by the holders of record of at least 10% in
aggregate principal amount of all Bonds outstanding on the tenth Market Day
prior to such Reset Date. The provision described in this paragraph is called
the "10% Requirement". If, with respect to any Reset Date, a Hold Notice is
duly given for this Bond but the 10% Requirement is not satisfied, the Trustee
shall give written notice of that fact (a "10% Requirement Notice") to the
registered holder of this Bond and the Company not later than the close of
business on the seventh Market Day before such Reset Date, in the manner
described in paragraph 9 below.
(d) Notwithstanding the foregoing, the Put Option shall be deemed to
be automatically exercised with respect to any Reset Date if Goldman, Sachs &
Co. exercises the Call Option with respect to such Reset Date but either (i) a
Market Disruption Event or Failed Remarketing occurs, as provided in paragraph 4
below, or (ii) Goldman, Sachs & Co. fails to pay the Face Value on the Reset
Date, as provided in paragraph 5(a) below.
4. Reset of Interest Rate. The interest rate on this Bond shall be
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reset on each Reset Date, unless the Company is obligated to purchase this Bond
on such date (or has previously done so) pursuant to the Put Option.
Notwithstanding the foregoing, reset of the interest rate shall be subject to
the occurrence of a Market Disruption Event or a Failed Remarketing as described
below.
Subject to its right to terminate the appointment of any such agent,
the Company shall take such action as is necessary to ensure that there shall at
all relevant times be a qualified financial institution appointed and acting as
its agent for the purpose of performing the actions contemplated hereby to be
performed by the Calculation Agent (such agent, including any successor agent,
the "Calculation Agent"). The Company has initially appointed Goldman, Sachs &
Co. as Calculation Agent. If the interest rate is to be reset on any Reset
Date, the Calculation Agent shall effect the reset as follows:
Between the tenth Market Day prior to the Reset Date and 11:00 A.M.,
New York City time, on the Calculation Date (as defined below), the Calculation
Agent shall select three financial institutions (one of which shall be Goldman,
Sachs & Co. if it so requests) that deal in the Company's debt securities and
have agreed to participate as reference dealers in accordance with the terms
described below (the "Reference Dealers"). If Goldman, Sachs & Co. has exercised
the Call Option with respect to the applicable Reset Date and so requests, each
Reference Dealer must include in its participation agreement a written
commitment (satisfactory to Goldman, Sachs & Co.) that, if it is selected as the
Final Dealer (as defined below), it will purchase from Goldman, Sachs & Co. on
the Calculation Date for settlement on such Reset Date and at the Final Offer
Price (as defined below), all the Bonds that Goldman, Sachs & Co. purchases
pursuant to the Call
<PAGE>
Option and tenders for resale to the Final Dealer on such Reset Date. For each
Reference Dealer, the Calculation Agent shall request the name of and telephone
and facsimile numbers for one individual to represent such Reference Dealer.
On the sixth Market Day prior to the applicable Reset Date (the
"Calculation Date"), the Calculation Agent shall undertake the following actions
to calculate a fixed rate at which interest will accrue on the Bonds from and
including such Reset Date to but excluding the next Reset Date (or, if there is
no subsequent Reset Date, the Final Maturity) (each such period, a "Reset
Period"). In paragraphs (a) and (b) below, all references to specific hours are
references to prevailing New York City time, and each notice will be given
telephonically and will be confirmed as soon as possible by facsimile to each of
the Calculation Agent and the Company. The times set forth below are guidelines
for action, and the Calculation Agent shall use reasonable efforts to adhere to
these times.
(a) At 12:00 P.M., the Calculation Agent shall:
(i) determine (or obtain from Goldman, Sachs & Co., if Goldman, Sachs
& Co. has exercised the Call Option with respect to the
applicable Reset Date) the approximate two-year U.S. Treasury
bond yield at or about such time, which shall be expressed as a
percentage (the "Designated Treasury Yield") and shall be based
on the then-current, two-year U.S. Treasury bond (the "Designated
Treasury Bond");
(ii) calculate and provide to the Reference Dealers, on a preliminary
basis, a hypothetical price at which the Bonds might be offered
for sale to a Reference Dealer on the applicable Reset Date (the
"Offer Price"). The Offer Price shall be expressed as a
percentage of the principal amount of the Bonds and shall equal
100% plus the Margin (as defined below) if the Treasury Rate
Difference (as defined below) is positive, or 100% minus the
Margin if the Treasury Rate Difference is negative. The Margin
shall also be expressed as a percentage of the principal amount
of the Bonds and shall equal the present value of the absolute
value of the Treasury Rate Difference applied to four semi-annual
periods (i.e., two years), discounted at the Designated Treasury
Yield divided by two. The "Treasury Rate Difference" means the
percentage (which may be positive or negative) equal to (x)
5.533% (the "Initial Treasury Yield") minus (y) the Designated
Treasury Yield; and
(iii) request each Reference Dealer to provide to the Calculation
Agent, when notified of the Final Offer Price as described in
paragraph (b) below, a firm bid, expressed as a percentage
representing an interest rate spread over the Designated Treasury
Yield (the "Spread"), at which such Reference Dealer would be
willing to purchase on such Calculation Date for settlement on
the applicable Reset Date, at the Final Offer Price, all of the
Bonds then outstanding (assuming for this purpose that the Bonds
will remain subject to the Call Option and, if the Call Option is
not exercised by Goldman, Sachs & Co., subject to the potential
exercise of the Put Option every two years, and will mature on
the Final Maturity, all as described herein). Each
<PAGE>
such firm bid must be given on an "all-in" basis and must remain
open for at least 30 minutes after it is given.
(b) At 12:30 P.M., the Calculation Agent shall determine (or obtain from
Goldman, Sachs & Co., if Goldman, Sachs & Co. has exercised the Call
Option) the Designated Treasury Yield on a final basis, and calculate
and provide to the Reference Dealers the Offer Price on a final basis
(the "Final Offer Price") and request each Reference Dealer to submit
its bid immediately as described in clause (a)(iii) above. If the
Calculation Agent receives bids from at least two of the Reference
Dealers, the following shall occur:
(i) the Reference Dealer providing the bid representing the lowest
all-in Spread (the "Final Spread") shall be the "Final Dealer";
(ii) if Goldman, Sachs & Co. has exercised the Call Option with
respect to the applicable Reset Date, the Final Dealer shall
purchase from Goldman, Sachs & Co. at the Final Offer Price,
for settlement on such Reset Date, all the Bonds that Goldman,
Sachs & Co. purchases pursuant to the Call Option and tenders
for resale to the Final Dealer on such Reset Date (assuming
that the interest rate on the Bonds will be reset so as to
equal the Adjusted Rate (as defined below) during the
applicable Reset Period); the Final Dealer shall not be
obligated to purchase any Bonds if Goldman, Sachs & Co. has not
exercised the Call Option;
(iii) the Calculation Agent shall calculate and provide to the
Company the "Adjusted Rate", which shall be the semi-annual,
bond-equivalent, fixed interest rate on the Bonds required to
produce, during the applicable Reset Period, a semi-annual,
bond-equivalent yield on the Bonds that equals the sum of the
Final Spread plus the final Designated Treasury Yield, assuming
that the Bonds are purchased on the applicable Reset Date at
the Final Offer Price and shall be repurchased by the Company
at par two years later; and
(iv) the interest rate on the Bonds shall be adjusted so as to equal
the Adjusted Rate, effective from and including the applicable
Reset Date to but excluding the next Reset Date (or, if there
is no subsequent Reset Date, the Final Maturity). If, with
respect to the applicable Reset Date, Goldman, Sachs & Co. has
not exercised the Call Option and an Effective Hold Notice is
given for this Bond, the Company shall promptly give written
notice of the Adjusted Rate to the registered holder.
All determinations regarding the Designated Treasury Yield and the Designated
Treasury Bond with respect to any Reset Date as described in clause (a)(i) and
the first sentence of paragraph (b) above shall be made by Goldman, Sachs & Co.
if another party is acting as the Calculation Agent, unless Goldman, Sachs & Co.
has elected not to exercise the Call Option with respect to such Reset Date, in
which case such determinations will be made as necessary by the Calculation
Agent.
<PAGE>
If the Calculation Agent determines that, on the applicable
Calculation Date, (x) a Market Disruption Event (as defined below) has occurred
or is continuing or (y) fewer than two Reference Dealers have provided firm bids
in a timely manner pursuant to participation agreements satisfactory to Goldman
Sachs & Co. substantially as described above (a "Failed Remarketing"), the steps
contemplated above shall be taken on the next Market Day on which the
Calculation Agent determines that no Market Disruption Event has occurred or is
continuing and at least two Reference Dealers have provided bids pursuant to
participation agreements satisfactory to Goldman, Sachs & Co. substantially as
described above. If the Calculation Agent determines that a Market Disruption
Event and/or a Failed Remarketing has occurred or is continuing for at least
four consecutive Market Days starting on the applicable Calculation Date, then
Goldman, Sachs & Co. shall be deemed not to have exercised the Call Option and
the Company shall repurchase this Bond on the applicable Reset Date at the Put
Price from the registered holder hereof on such Reset Date, all as if the Put
Option on this Bond had been exercised with respect to such Reset Date. In
these circumstances, the registered holder may not continue to hold this Bond by
giving an Effective Hold Notice. The Calculation Agent shall notify the Company
of such determination promptly after the close of business on such fourth Market
Day. The Company shall give notice to the registered holder that this Bond will
be repurchased by the Company on the applicable Reset Date at the Put Price,
from the registered holder on such Reset Date, such notice to be given no later
than such second Market Day prior to the Reset Date in the manner described
below.
Notwithstanding the foregoing, if at any time relevant to a particular
Reset Date, Goldman, Sachs & Co. is not acting as Calculation Agent, then, with
respect to such Reset Date, the determinations and notice to the Company
described in the preceding paragraph shall be made and given by Goldman, Sachs &
Co., unless Goldman, Sachs & Co. does not exercise the Call Option with respect
to such Reset Date, in which case such determinations and notice will be made
and given by the Calculation Agent.
"Market Disruption Event" means any of the following: (i) a suspension
or material limitation in trading in securities generally on the New York Stock
Exchange or the establishment of minimum prices on such exchange; (ii) a general
moratorium on commercial banking activities declared by either federal or New
York State authorities; (iii) any material adverse change in the existing
financial, political or economic conditions in the United States of America;
(iv) an outbreak or escalation of hostilities involving the United States of
America or the declaration of a national emergency or war by the United States
of America; or (v) any material disruption of the U.S. government securities
market, U.S. corporate bond market and/or U.S. federal wire system.
All determinations regarding Market Disruption Events and Failed
Remarketings, including whether or not any such event has occurred or is
continuing, shall be made by the Calculation Agent (or Goldman, Sachs & Co., if
applicable as provided above) in its sole discretion.
All percentages resulting from any calculation with respect to the
Bonds will be rounded upwards, if necessary, to the nearest one-thousandth of a
percentage point (e.g., 5.6531% (or 0.056531) being rounded to 5.654 (or
0.05654)), and all U.S. dollar amounts will be rounded to the nearest cent (with
one-half cent being rounded upwards).
All determinations made by the Calculation Agent (or Goldman, Sachs &
Co.) regarding the matters described herein shall be final, conclusive and
binding on all concerned absent manifest
<PAGE>
error. No determination made by the Calculation Agent (or Goldman, Sachs & Co.)
regarding the matters described herein shall give rise to any liability on the
part of the Calculation Agent, Goldman, Sachs & Co., the Trustee or the Company.
5. Settlement on Exercise of Call Option or Put Option. For as long
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(but only for as long) as this Bond or any portion hereof is issued in the form
of a Global Security, the provisions of paragraph 5(a) through 5(d) below,
inclusive, shall apply with respect to this Bond or such portion, as the case
may be.
(a) If the Call Option is exercised, then, on the applicable Reset
Date, all beneficial interests in this Bond held by or through Agent Members (as
defined below) shall be transferred to a Depositary account designated by
Goldman, Sachs & Co. The transfers shall be made automatically, without any
action on the part of any holder or beneficial owner, by book entry through the
facilities of the Depositary. Goldman, Sachs & Co. shall be obligated to make
payment of the Face Value of this Bond to the Depositary or its nominee, for
credit to the accounts of the Agent Members by or through which beneficial
interests in this Bond are held, by the close of business on the applicable
Reset Date. Each such transfer shall be made against the corresponding payment,
and each such payment shall be made against the corresponding transfer, in
accordance with the Depositary's Applicable Procedures. In all cases, the
Company shall remain obligated to make payment of accrued and unpaid interest on
this Bond, with interest payable on the applicable (or any prior) Reset Date
being payable to the registered holder on the corresponding Interest Payment
Record Date.
If Goldman, Sachs & Co. fails to pay the Face Value of this Bond on
the applicable Reset Date, the Call Option shall be deemed not to have been
exercised and the Put Option will be deemed to have been exercised on this Bond
with respect to such Reset Date. In these circumstances, the registered holder
on the applicable Reset Date may not continue to hold this Bond by giving an
Effective Hold Notice, and the Company will be obligated to pay, not later than
two business days following the applicable Reset Date, the Put Price for this
Bond (including accrued interest from the applicable Reset Date to the date
payment is made), with settlement otherwise occurring as described in paragraph
5(b).
As used herein, (i) "Agent Member" means, at any time, any person who
is a member of, or participant in, the Depositary at such time and (ii)
"Applicable Procedures" means, with respect to any payment, transfer or other
transaction to be effected with respect to a Global Security, through the
facilities of the Depositary at any time, the policies and procedures of the
Depositary applicable to such transaction, as in effect at such time.
(b) If the Put Option is exercised as to this Bond, then, on the
applicable Reset Date, all beneficial interests in this Bond held by or through
Agent Members shall be transferred to a Depositary account designated by the
Company. The transfers shall be made automatically, without any action on the
part of any holder or beneficial owner, by book entry through the facilities of
the Depositary. The Company shall be obligated to make payment of the Put Price
of this Bond to the Depositary or its nominee, for credit to the accounts of the
Agent Members by or through which beneficial interests in this Bond are held, by
the close of business on the applicable Reset Date (or, if the Put Option is
deemed to have been exercised as contemplated by the second paragraph of
paragraph 5(a) above, by the close of business on the second business day
following the applicable Reset Date). Each such transfer shall be made against
the corresponding payment, and each such payment shall be made against the
corresponding transfer, in accordance with the
<PAGE>
Depositary's Applicable Procedures. If the Company fails to pay the Put Price
for this Bond on the applicable Reset Date, accrued interest from such Reset
Date to the date the payment is made shall be payable as part of such Put Price,
in the same manner and for credit to the same accounts as such Put Price.
Whether or not purchased pursuant to the Put Option, the Company shall remain
obligated to make payment of accrued and unpaid interest on this Bond, with
interest payable on the applicable (or any prior) Reset Date being payable to
the registered holder on the corresponding Interest Payment Record Date as
provided herein and in the Indenture.
(c) The transactions described in paragraphs 5(a) and 5(b) above shall
be executed on the applicable Reset Date through the facilities of the
Depositary in accordance with its Applicable Procedures, and the accounts of the
respective Agent Members shall be debited and credited and beneficial interests
in this Bond shall be delivered by book entry as necessary to effect the
purchases and sales provided for above. Unless the Depositary's Applicable
Procedures require otherwise, such transactions shall settle, and all other
payments in respect of the Bonds shall be made, in immediately available funds
through DTC's Same-Day Funds Settlement System. Notwithstanding any provision
hereof or of the Indenture, neither the Company, the Trustee nor Goldman, Sachs
& Co., nor any agent of any such person, shall have any responsibility with
respect to the Applicable Procedures or for any payments, transfers or other
transactions, or any notices or other communications, among the Depositary, its
Agent Members, any other direct or indirect participants therein and any
beneficial owners of a Global Security. For all purposes of this Bond and the
Indenture, any payment or notice to be made or given with respect to this Bond
by the Company or Goldman, Sachs & Co. shall be deemed made or given when made
or given to the Depositary or its nominee, in accordance with its Applicable
Procedures.
(d) The settlement procedures described in paragraphs 5(a), 5(b) and
5(c) above may be modified, notwithstanding any contrary terms of the Bonds or
the Indenture, to the extent required by the Depositary. In addition,
notwithstanding any contrary terms of the Bonds or the Indenture, the Company
may modify the settlement procedures described in paragraphs 5(a), 5(b) and 5(c)
above in order to facilitate the settlement process.
(e) If any Bonds are issued in non-book-entry form, the Company shall
modify the provisions of paragraphs 5(a) through 5(d) above, inclusive, so as to
ensure that Reset Date settlements of transactions in such Bonds are effected in
as comparable a manner as practical, provided that such modified procedures
shall not adversely affect the interests of the holders of the outstanding Bonds
in any material respect.
6. Default, Waiver, Amendment and Enforcement. (a) In case an Event
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of Default, as defined in the Indenture, with respect to the Bonds shall have
occurred and be continuing, the principal of all outstanding Bonds may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture provides that in the event of such a declaration, its consequences
may be rescinded and annulled (and the related default and its consequences may
be waived) with respect to all the Bonds by the holders of a majority in
aggregate principal amount of all the Bonds then outstanding, voting as a
separate class (or, in some cases, of all the Securities then outstanding,
voting as a single class), in accordance with the provisions of, and in the
circumstances provided by, the Indenture. It is also provided in the Indenture
that the holders of a majority in aggregate principal amount of the Bonds at the
time outstanding may, on behalf of the holders of all of the Bonds, waive, prior
to such a declaration, any past default under the
<PAGE>
Indenture with respect to the Bonds and its consequences, except a default in
the payment of interest on or principal of any Bond.
For all purposes of this Bond and the Indenture, any amount payable
by the Company in respect of the Put Price of this or any other Bond (including
any such amount payable by the Company because Goldman, Sachs & Co. fails to pay
the Face Value of any Bond after its exercise of the Call Option as to this
Bond) shall be deemed to be an amount payable by the Company in respect of the
principal of such Bond at its maturity, and any default by the Company in paying
such amount shall be deemed to be a default in the payment of such principal at
maturity. No failure by Goldman, Sachs & Co. to purchase any Bond pursuant to
the Call Option shall be deemed to be a default under this Bond or the Indenture
for any purpose.
(b) The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the Securities of all series to be affected (voting as one
class) at the time outstanding, evidenced as in the Indenture provided, to
execute supplemental indentures for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, the Indenture
with respect to each such series of Securities or modifying in any manner the
rights of the holders of each such series of Securities; provided, however, that
no such supplemental indenture shall (i) extend the stated maturity or reduce
the principal amount hereof, or reduce the rate or extend the time of payment of
interest hereon, or reduce or extend the time of payment of the Face Value or
the Put Price hereof, or impair or affect the right of any registered holder
hereof to institute suit for the payment hereof, without the consent of the
registered holder hereof, or (ii) reduce the aforesaid percentage of Securities
of any series or of all series (voting as one class), the consent of the holders
of which is required for any such supplemental indenture affecting this Bond,
without the consent of the registered holder hereof.
(c) As provided in and subject to the provisions of the Indenture, no
holder of this Bond shall have the right to institute any suit, action or
proceeding with respect to the Indenture, or for appointment of any receiver or
trustee or for any other remedy thereunder, unless such holder previously shall
have given the Trustee written notice of default and the continuance thereof,
the holders of not less than 25% in aggregate principal amount of the Bonds then
outstanding shall have made written request to the Trustee to institute such
suit, action or proceeding and shall have offered to the Trustee reasonable
indemnity and the Trustee, for 60 days after the receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute the same
and shall not have received any direction inconsistent therewith from the
holders of a majority in aggregate principal amount of all affected Securities
then outstanding (which holders, voting as a single class, shall be entitled to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee with respect to the Bonds).
(d) No reference herein to the Indenture and no provision of this Bond
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal or Put Price of and interest
on this Bond at the place, at the respective times, at the rate and in the coin
or currency herein prescribed.
(e) Any consent, waiver or other action by the registered holder of
this Bond provided pursuant to this Bond or the Indenture (unless effectively
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders of this
<PAGE>
Bond and of any Bond issued in exchange or substitution herefor, irrespective of
whether or not any notation of such consent or waiver is made upon this Bond or
such other Bond.
7. Form and Denomination; Global Securities. (a) The Bonds are
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issuable as fully registered Bonds without coupons in the denominations of
$1,000 and any whole multiple of $1,000. At the corporate trust office of the
Trustee referred to on the face hereof, and in the manner and subject to the
limitations provided herein and in the Indenture, Bonds may be exchanged for a
like aggregate principal amount of Bonds of other authorized denominations,
without payment of any charge other than a sum sufficient to reimburse the
Company for any tax or other governmental charge incident thereto.
(b) The transfer of this Bond is registrable by the registered holder
hereof in person or by his attorney, duly authorized in writing, on the books of
the Company at the office or agency of the Company referred to on the face
hereof, subject to the terms of this Bond and the Indenture but without payment
of any charge other than a sum sufficient to reimburse the Company for any tax
or other governmental charge incident thereto, and upon surrender and
cancellation of this Bond upon any such transfer, a new Bond or Bonds of
authorized denomination or denominations, for the same aggregate principal
amount, shall be issued to the transferee in exchange herefor.
(c) The Bond evidenced by this certificate has been issued in the form
of a Global Security and, for as long as this Bond shall be issued in such form,
the provisions of paragraphs (c)(i) through (c)(iv), inclusive, below shall
apply to this Bond.
(i) Notwithstanding any other provision of this Bond or the
Indenture, this Global Security may not be exchanged in whole or in
part for Bonds registered, and no transfer of this Global Security in
whole or in part may be registered, in the name of any person other
than the Depositary or a nominee thereof unless (A) the Depositary has
notified the Company that (1) it is unwilling or unable to continue as
Depositary or (2) has ceased to be a clearing agency registered under
the Exchange Act or (B) there shall have occurred and be continuing an
Event of Default with respect to the Bonds, or except as the Company
may request in order to facilitate the purchase of this Bond or any
portion hereof by Goldman, Sachs & Co. pursuant to the Call Option or
by the Company pursuant to the Put Option on any Reset Date (provided
that, after consummation of any such purchase pursuant to the Call
Option, the Bond or portion so purchased may be reissued in the form
of a Global Security in accordance with the Applicable Procedures).
(ii) Subject to paragraph (c)(i) above, any exchange of this
Global Security for other Bonds may be made in whole or in part, and
all Bonds issued in exchange for this Global Security or any portion
hereof shall be registered in such names and delivered to such persons
as the Depositary shall direct.
(iii) Every Bond authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, this
Global Security or any portion hereof shall be issued and
authenticated in the form of, and shall be, a Global Security, shall
bear such legend as the Depositary may require and shall be delivered
to the Depositary or a nominee thereof or custodian therefor, unless
such
<PAGE>
Bond is registered in the name of a person other than the Depositary
or a nominee thereof.
(iv) As used herein, (A) "Global Security" means a Bond that
evidences all or any portion of the Bonds and is registered in the
name of the Depositary (or its nominee), (B) "Depositary" means a
clearing agency registered under the Exchange Act and designated by
the Company to act as Depositary for the Bonds issued in book-entry
form, and (C) "Exchange Act" means the Securities Exchange Act of 1934
(or any successor provision) as amended from time to time.
8. Holder. The Company, the Trustee and Goldman, Sachs & Co. (and
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any agent of any such person) may treat the person in whose name this Bond shall
be registered as of the date of determination upon the books of the Company kept
for such purpose pursuant to the Indenture as the sole and absolute owner and
holder of this Bond (whether or not this Bond shall be overdue and
notwithstanding any notation of ownership or other writing hereon) for all
purposes, including the making of any payment in respect hereof, any exercise of
the Call Option or the Put Option and consummation of any sale and purchase
hereof pursuant thereto, the giving of any Call Notice, Hold Notice or other
notice with respect hereto, and the giving of any consent or taking of any other
action with respect hereto, and neither the Company nor the Trustee nor Goldman,
Sachs & Co. nor any such agent shall be affected by any notice to the contrary.
9. Notices. For as long as this Bond (or any portion hereof) is
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issued in the form of a Global Security, each Call Notice, 10% Requirement
Notice and other notice to be given to the holder of this Bond (or any such
portion) shall be deemed to have been duly given to such holder when given to
the Depositary, or its nominee, in accordance with its Applicable Procedures.
If at any time this Bond (or any portion hereof) is not issued in the
form of a Global Security, each Call Notice, 10% Requirement Notice and other
notice to be given to the holder of this Bond (or any such portion) shall be
deemed to have been duly given to such holder upon the mailing of such notice to
the registered holder at such holder's address as it appears on the books of the
Company maintained for such purpose pursuant to the Indenture as of the close of
business preceding the day such notice is given.
Neither the failure to give any notice nor any defect in any notice
given to the holder of this Bond or any other Bond shall affect the sufficiency
of any notice given to another holder of any Bonds.
With respect to this Bond, whether or not issued in the form of a
Global Security, Hold Notices may be given by the registered holder hereof to
the Trustee only by facsimile transmission or by mail and must actually be
received by the Trustee at the following address no later than 10:00 A.M., New
York City time, on the tenth Market Day prior to the applicable Reset Date:
The First National Bank of Chicago
One North State Street, 9th Floor
Chicago, Illinois 60602
Attention: Corporate Trust Office
facsimile no.: (312) 407-1708
Hold Notices may be given with respect to this Bond only by the registered
holder hereof.
<PAGE>
10. No recourse shall be had for the payment of the principal of, or
the interest on, this Bond or of the Face Value upon any exercise of the Call
Option or of the Put Price upon any exercise of the Put Price, or for any claim
based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation or entity, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issue hereof, expressly waived and released.
11. Provisions Relating to Goldman, Sachs & Co. Insofar as the
-------------------------------------------
provisions of this Bond purport to provide rights to Goldman, Sachs & Co.
against any holder of this Bond, such rights (including such rights to purchase
this Bond pursuant to the Call Option on any Reset Date) shall be rights of the
Company and shall be enforceable by the Company against such holder. Each
holder of this Bond shall hold this Bond (and by holding the same shall be
deemed to have agreed to do so) subject to the foregoing. Without limiting the
foregoing, Goldman, Sachs & Co. may take any action under this Bond (including
giving any notice, making any determination and effecting any settlement
pursuant to paragraphs 2, 4 and 5 hereof) that the provisions of this Bond
contemplate may be taken by Goldman, Sachs & Co.
Pursuant to section 6 of the Calculation Agency Agreement, dated as of
June 8, 1998, Goldman, Sachs & Co. has agreed with the Company, for the benefit
of the applicable holders of this Bond from time to time, that, if Goldman,
Sachs & Co. exercises the Call Option with respect to any Reset Date when this
Bond is outstanding, Goldman, Sachs & Co. will purchase this Bond from the
registered holder hereof on such Reset Date, upon the terms and subject to the
conditions set forth herein. Except as may be expressly provided in section 6
of such agreement, no holder of this Bond shall have any right, remedy or claim
against Goldman, Sachs & Co. under this Bond, the Indenture or such agreement.
Upon the occurrence of an Event of Default and certain other circumstances set
forth in such agreement, Goldman, Sachs & Co. shall be entitled to demand that
the Company settle the Call Option on the terms agreed therein.
No provision of this Bond shall be invalid or unenforceable by reason
of any reference herein to Goldman, Sachs & Co. In addition, no provision of
this paragraph shall be construed to impair or otherwise affect any rights that
Goldman, Sachs & Co. may have at any time as a holder of any Securities.
12. Governing Law. As provided in the Indenture, this Bond shall for
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all purposes be governed by and construed in accordance with the laws of the
State of New York.
<PAGE>
EXHIBIT 5.1
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OPINION OF HUGHES & LUCE, L.L.P.
[HUGHES & LUCE, L.L.P. LETTERHEAD]
June 8, 1998
Wal-Mart Stores, Inc.
702 S.W. 8th Street
Bentonville, Arkansas 72716-8095
Ladies and Gentlemen:
We have acted as special counsel to Wal-Mart Stores, Inc., a Delaware
corporation (the "Company"), in connection with the Company's Registration
Statement on Form S-3 (File No. 33-52045) and the Company's Registration
Statement on Form S-3 , Registration Statement No. 333-52045 (collectively, the
"Registration Statement") as filed with the Securities and Exchange Commission
(the "Commission") on April 13, 1994 and May 7, 1998, respectively, under the
Securities Act of 1933, as amended (the "Act"), and with respect to the issuance
of an aggregate principal amount of $500,000,000 of the 5.85% Puttable Reset
Bond PURSsm due June 1, 2018 of the Company (the "Bonds") offered pursuant to
that certain Prospectus Supplement dated June 2, 1998 (the "Prospectus
Supplement") and filed with the Commission on June 4, 1998 pursuant to Rule
424(b)(2) of the Act, which Prospectus Supplement is part of the combined
Prospectus dated June 2, 1998 that form a part of the Registration Statement.
TheBonds are issued pursuant to an Indenture, dated April 1, 1991, by and
between The First National Bank of Chicago (the "Bank") and the Company, as
amended and supplemented by a First Supplemental Indenture, dated September 9,
1992 by and between the Bank and the Company (together, the "Indenture").
In rendering this opinion, we have examined and relied upon executed
originals, counterparts, or copies of such documents, records, and certificates
(including certificates of public officials and officers of the Company) as we
considered necessary or appropriate for enabling us to express the opinions set
forth below. In all such examinations, we have assumed the authenticity and
completeness of all documents submitted to us as originals and the conformity to
originals and completeness of all documents submitted to us as photostatic,
conformed, notarized, or certified copies.
Based on the foregoing, we are of the opinion that the Bonds have been
duly authorized and are legally issued and constitute the valid and legally
binding obligations of the Company.
This opinion may be filed as an exhibit to the Registration Statement.
We also consent to the reference to this firm as having passed on the validity
of the Bonds under the caption "Validity of the Bonds" in the Prospectus
Supplement, which is a part of the Registration Statement. In
<PAGE>
giving this consent, we do not admit that we are included in the category of
persons whose consent is required under Section 7 of the Act, or the rules and
regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ Hughes & Luce, L.L.P.
