<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 20, 1999.
Registration No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
-------------------
THE KROGER CO.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
OHIO 5411 31-0345740
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
</TABLE>
1014 VINE STREET
CINCINNATI, OHIO 45202
(513)762-4000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
ADDITIONAL REGISTRANTS
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alpha Beta Company California 5411 95-1456805 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Bay Area Warehouse Stores, California 5411 93-1087199 1014 Vine Street
Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Bell Markets, Inc. California 5411 94-1569281 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Cala Co. Delaware 5411 95-4200005 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 2
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cala Foods, Inc. California 5411 94-1342664 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
CB&S Advertising Agency, Oregon 7336 93-0587794 1014 Vine Street
Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
City Market, Inc. Colorado 5411 84-0595476 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Compare, Inc. Delaware 5411 86-0609950 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Crawford Stores, Inc. California 5411 95-0657410 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Dillon Companies, Inc. Kansas 5411 48-0196590 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Dillon Real Estate Co., Inc. Kansas 6512 48-0680105 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Distribution Trucking Oregon 5141 93-0786441 1014 Vine Street
Company Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Drug Distributors, Inc. Indiana 5122 31-1112998 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
FM Holding Corporation Delaware 5411 93-0864302 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
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<PAGE> 3
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FM, Inc. Utah 7389 93-1197669 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
FM Retail Services, Inc. Washington 5411 91-1628326 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Food 4 Less GM, Inc. California 5411 95-4390406 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Food 4 Less Holdings, Inc. Delaware 5411 33-0642810 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Food 4 Less Merchandising, California 5411 33-0483193 1014 Vine Street
Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Food 4 Less of California, California 5411 33-0293011 1014 Vine Street
Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Food 4 Less of Southern Delaware 5411 33-0483203 1014 Vine Street
California, Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Fred Meyer, Inc. Delaware 5411 91-1826443 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Fred Meyer Jewelers, Inc. Delaware 5944 93-1197671 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Fred Meyer of Alaska, Inc. Alaska 5411 93-0802793 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
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<PAGE> 4
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fred Meyer of California, Inc. California 5411 93-0979434 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Fred Meyer Stores, Inc. Delaware 5411 93-0798201 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Grand Central, Inc. Utah 5411 87-0277527 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Henpil, Inc. Texas 5921 74-6044519 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Hughes Markets, Inc. California 5411 95-1947206 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Hughes Realty, Inc. California 6512 95-2253719 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Inter-American Foods, Inc. Ohio 2099 74-1491846 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Jackson Ice Cream Co., Inc. Kansas 2024 48-0686152 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
JH Properties, Inc. Washington 6512 91-1816127 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Junior Food Stores of West Florida 5411 59-0980071 1014 Vine Street
Florida, Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
J.V. Distributing, Inc. Michigan 5141 31-1107025 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
KRGP Inc. Ohio 6719 31-1569084 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
KRLP Inc. Ohio 6719 31-1579339 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
The Kroger Co. of Michigan Michigan 5411 38-0900860 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Kroger Dedicated Logistics Ohio 5141 31-1399126 1014 Vine Street
Co. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Kroger Limited Partnership I Ohio 5411 31-1569568 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Kroger Limited Partnership II Ohio 2026 31-1569087 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
KU Acquisition Corporation Washington 5411 91-1765648 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Kwik Shop, Inc. Kansas 5411 48-6112339 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
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<PAGE> 6
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Merksamer Jewelers, Inc. California 5944 68-0202947 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Mini Mart, Inc. Wyoming 5411 83-0208334 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Peyton's-Southeastern, Inc. Tennessee 5149 61-0942129 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
QFC Sub, Inc. Washington 5411 91-1931177 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Quality Food Centers, Inc. Washington 5411 91-1330075 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Quality Food Holdings, Inc. Delaware 6719 91-1829339 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Quality Food, Inc. Delaware 5411 91-1829342 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Quik Stop Markets, Inc. California 5411 94-1610162 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Ralphs Grocery Company Delaware 5411 95-4356030 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Richies Inc. Texas 5921 74-2047032 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rocket Newco, Inc. Texas 5181 76-0542912 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Roundup Co. Washington 5411 93-0798202 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Saint Lawrence Holding Delaware 6719 86-0504830 1014 Vine Street
Company Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Second Story, Inc. Washington 6512 91-1753356 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Smith's Beverage of Wyoming 5181 80-0126833 1014 Vine Street
Wyoming, Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Smith's Food & Drug Delaware 5411 87-0258768 1014 Vine Street
Centers, Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Smitty's Equipment Leasing, Delaware 7359 86-0758585 1014 Vine Street
Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Smitty's Super Valu, Inc. Delaware 5411 13-3054103 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Smitty's Supermarkets, Inc. Delaware 5411 86-0765032 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
THGP Co., Inc. Pennsylvania 6719 23-2922125 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
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<PAGE> 8
<TABLE>
<CAPTION>
Primary IRS
Standard Employer
Industrial Identifi-
Jurisdiction of Classification cation
Name of Registrant Number Organization Number Number Address and Telephone
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
THLP Co., Inc. Pennsylvania 6719 23-2922123 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Topvalco, Inc. Ohio 6512 31-0574717 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Treasure Valley Land Idaho 6512 82-0474377 1014 Vine Street
Company, L.C. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Turkey Hill, L.P. Pennsylvania 5411 23-2922126 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Vine Court Assurance Vermont 6331 31-1192645 1014 Vine Street
Incorporated Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Wells Aircraft, Inc. Kansas 4581 48-0690719 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Western Property Investment California 6512 87-0485081 1014 Vine Street
Group, Inc. Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
Wydiv, Inc. Texas 5921 75-6032155 1014 Vine Street
Cincinnati, Ohio
45202
(513) 762-4000
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 9
PAUL W. HELDMAN, ESQ.
SENIOR VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL
THE KROGER CO.
1014 VINE STREET
CINCINNATI, OHIO 45202
(513) 762-4000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With copy to:
STEVEN KAPLAN
ARNOLD & PORTER
555 TWELFTH STREET, N.W.
WASHINGTON, D.C. 20004
(202) 942-5998
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of the Registration Statement.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General
Instruction G, check the following box: [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering: [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: [ ]
CALCULATION OF REGISTRATION FEE
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- ------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Title of each class of maximum maximum
securities to be Amount to be offering price aggregate Amount of
registered Registered per unit offering price(1) registration fee
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
6.34% Senior Exchange $250,000,000 100%(1) $250,000,000 $69,500.00
Notes due 2001
- ------------------------------------------------------------------------------------------------------------------
Guarantees of the $250,000,000(2)
6.34% Senior Exchange
Notes due 2001(2)
- ------------------------------------------------------------------------------------------------------------------
7.25% Senior Exchange $350,000,000 100%(1) $350,000,000 $97,300.00
Notes due 2009
- ------------------------------------------------------------------------------------------------------------------
Guarantees of the $350,000,000(2)
7.25% Senior Exchange
Notes due 2009(2)
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 10
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
7.70% Senior Exchange $300,000,000 100%(1) $300,000,000 $83,400.00
Notes due 2029
- ------------------------------------------------------------------------------------------------------------------
Guarantees of the $300,000,000(2)
7.70% Senior Exchange
Notes due 2029(2)
- ------------------------------------------------------------------------------------------------------------------
Total $900,000,000 100%(1) $900,000,000 $250,200.00
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated pursuant to Rule 457(f)(2) of the Securities Act of 1933 solely
for the purpose of computing the registration fee.
(2) Pursuant to Rule 457(n) under the Securities Act of 1933, no separate
registration fee is payable for the Guarantees.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 11
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED AUGUST 20, 1999
PRELIMINARY PROSPECTUS
THE KROGER CO.
Exchange Offer for
$250,000,000 6.34% Senior Notes due 2001
$350,000,000 7.25% Senior Notes due 2009
$300,000,000 7.70% Senior Notes due 2029
----------------------
Guaranteed by our subsidiaries listed on page 36 of this prospectus.
------------------------
- Expires 5:00 p.m., New York City time, on , 1999, unless
extended.
- All old notes issued on June 25, 1999 that are validly tendered and not
withdrawn will be exchanged for new notes.
- The only conditions to completing the exchange offer are that it does not
violate applicable law or any applicable interpretation of the staff of
the SEC and that no injunction, order or decree has been issued that
would prohibit, prevent or materially impair our ability to proceed with
the exchange offer.
- You may withdraw your tender of old notes at any time prior to the
expiration of the exchange offer.
- The exchange will not be a taxable event for U.S. federal income tax
purposes.
- The terms of the new notes to be issued in the exchange offer are
substantially identical to those of the old notes, except for some
transfer restrictions, registration rights and liquidated damages
relating to the old notes.
- The old notes are, and the new notes will be, fully and unconditionally
guaranteed, jointly and severally, on a senior unsecured basis by most of
the subsidiaries of our company.
- Affiliates of our company may not participate in the exchange offer.
- There is no existing market for the new notes, and we do not intend to
apply for their listing on any securities exchange.
Please refer to "Risk Factors" beginning on page 11 of this document for
important information.
----------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------------
The date of this prospectus is , 1999.
<PAGE> 12
THIS PROSPECTUS INCORPORATES BY REFERENCE IMPORTANT BUSINESS AND FINANCIAL
INFORMATION IN DOCUMENTS THAT ARE NOT CONTAINED IN OR DELIVERED WITH THE
PROSPECTUS. THESE DOCUMENTS ARE AVAILABLE WITHOUT CHARGE UPON REQUEST FROM PAUL
HELDMAN, 1014 VINE STREET, CINCINNATI, OHIO 45202-1100, TELEPHONE NUMBER (513)
762-4000. TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE
BY , 1999.
---------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
WHERE YOU CAN FIND MORE INFORMATION......................... 1
PROSPECTUS SUMMARY.......................................... 2
THE COMPANY................................................. 2
THE EXCHANGE OFFER.......................................... 2
SUMMARY OF THE TERMS OF THE NEW NOTES....................... 7
SELECTED FINANCIAL DATA..................................... 9
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES............. 10
RISK FACTORS................................................ 11
Our significant indebtedness could adversely affect us by
reducing our flexibility to respond to changing
business and economic conditions and increasing our
borrowing costs........................................ 11
We cannot assure you that Kroger and Fred Meyer will be
successfully combined or that Fred Meyer's recent
acquisitions will be successfully combined............. 11
We may not achieve the expected cost savings and other
benefits of the merger and we will have significant
merger related costs that will have a material negative
effect on our results of operations.................... 12
The guarantees of the notes by our subsidiaries may be
inadequate............................................. 12
Federal and state statutes permit courts, under specific
circumstances, to void guarantees and require the
return of payments received from guarantors............ 12
You may not be able to sell your notes easily............. 13
The liquidity of any market for the old notes is likely to
decline after the completion of the exchange offer..... 13
If you do not exchange your old notes for new notes, you
will remain subject to transfer restrictions........... 13
USE OF PROCEEDS............................................. 14
THE EXCHANGE OFFER.......................................... 14
DESCRIPTION OF THE NEW NOTES................................ 22
FEDERAL INCOME TAX CONSIDERATIONS........................... 30
PLAN OF DISTRIBUTION........................................ 33
LEGAL MATTERS............................................... 34
EXPERTS..................................................... 34
FORWARD-LOOKING STATEMENTS.................................. 35
LIST OF SUBSIDIARY GUARANTORS............................... 36
</TABLE>
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR TO
WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT. THIS DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL
TO SELL THESE SECURITIES. THE INFORMATION IN THIS DOCUMENT MAY ONLY BE ACCURATE
ON THE DATE OF THIS DOCUMENT.
i
<PAGE> 13
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-4 under the
Securities Act of 1933 with respect to the new notes to be issued in the
exchange offer. This prospectus, which forms a part of the registration
statement, does not contain all of the information in the registration statement
and the exhibits and schedules to the registration statement. Some parts of the
registration statement are omitted here in accordance with the SEC's rules and
regulations. Any statements made in this prospectus concerning the provisions of
various documents are not necessarily complete. In each instance, we refer you
to the copy of those documents filed as an exhibit to the registration statement
for the full text of those provisions. Each statement is qualified in its
entirety by that reference.
Our common stock is listed on the New York Stock Exchange (symbol KR) and
we file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549;
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511; and 7 World Trade Center, Suite 1300, New York, New York 10048.
Please call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms. Our electronic SEC filings are also available to the public
from the SEC's web site at http://www.sec.gov. In addition, our company
maintains a web site at http://www.kroger.com that contains additional
information, including news releases about our business and operations.
The SEC allows us to "incorporate by reference" in this prospectus the
information we file with the SEC. This means that we can disclose important
information to you by referring you to these documents. The information
incorporated by reference is an important part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede this information. We incorporate by reference the documents listed
below, which we have already filed with the SEC, and any future filings we make
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until
the completion of the exchange offer:
<TABLE>
<CAPTION>
KROGER SEC FILINGS (FILE NO. 1-303) PERIOD
----------------------------------- ------
<S> <C>
Annual Report on Form 10-K................... Year ended January 2, 1999, as amended.
Quarterly Report on Form 10-Q................ Quarter ended May 22, 1999.
Current Reports on Form 8-K or Form 8-K/A.... January 8, 1999; January 15, 1999; January
28, 1999; April 30, 1999; May 10, 1999; May
28, 1999, as amended as of the same date;
June 17, 1999; June 23, 1999; June 25, 1999;
July 20, 1999 and August 20, 1999.
</TABLE>
You may request a copy of any filings made by us with the SEC, or any of
the agreements or other documents that constitute exhibits to those filings, at
no cost, by writing or telephoning us at the following address or phone number:
The Kroger Co.
1014 Vine Street
Cincinnati, Ohio 45202-1100
(513) 762-4000
Attention: Paul Heldman
1
<PAGE> 14
PROSPECTUS SUMMARY
This summary highlights selected information from this prospectus and may
not contain all information that is important to you. This prospectus includes
specific terms of the exchange offer, as well as information regarding our
business and detailed financial data. We encourage you to read this prospectus
in its entirety and the other documents referred to in this prospectus.
THE COMPANY
Kroger was founded in 1883 and was incorporated in 1902. We maintain our
corporate offices in Cincinnati, Ohio, and are the nation's largest supermarket
operator measured by sales in 1998. Our mailing address is The Kroger Co., 1014
Vine Street, Cincinnati, Ohio 45202-1100, telephone (513) 762-4000.
On May 27, 1999, we completed our previously announced merger with Fred
Meyer, Inc., creating the nation's largest supermarket company, with combined
annual sales of $43.1 billion during 1998. Fred Meyer is now a wholly-owned
subsidiary of Kroger. You should consider the new circumstances of Kroger that
result from the merger. See "Risk Factors" contained in this prospectus. Audited
supplemental consolidated financial statements for the combined company are
available to you on our Current Report on Form 8-K dated May 28, 1999, which has
been filed with the SEC.
As of the completion of our merger with Fred Meyer, Inc., we operated
approximately 2,200 supermarkets and multidepartment stores in 31 states, 797
convenience stores in 15 states and 381 fine jewelry stores in 25 states. One
hundred thirteen of the convenience stores are franchised to third parties in
three states. We also operate manufacturing facilities that permit us to offer
quality, low-cost private label products.
THE EXCHANGE OFFER
On June 25, 1999, we completed the private placement of $250 million
principal amount of our 6.34% Senior Notes due 2001, $350 million principal
amount of our 7.25% Senior Notes due 2009 and $300 million principal amount of
our 7.70% Senior Notes due 2029. The notes are guaranteed by most of our
subsidiaries. A list of these subsidiary guarantors can be found on page 36 of
this prospectus.
The notes were not registered under the Securities Act and, therefore, they
are subject to significant restrictions on resale. When we sold those notes, we
and the subsidiary guarantors entered into a registration rights agreement with
the initial purchasers -- Goldman, Sachs & Co., Banc One Capital Markets, Inc.,
Banc of America Securities LLC, Chase Securities Inc. and Salomon Smith Barney
Inc. In this registration rights agreement, we agreed to deliver to you this
prospectus and to permit you to exchange those old notes for new notes that have
substantially identical terms and have been registered under the Securities Act.
We believe that the new notes may be resold by you without compliance with
the registration and prospectus delivery provisions of the Securities Act,
subject to limited conditions. Following the exchange offer, any old notes that
you did not exchange for new notes will continue to be subject to restrictions
on resale and we will have no obligation to you to register those old notes
under the Securities Act.
We issued the old notes under an indenture, dated June 25, 1999, between
our company and Firstar Bank, National Association, as trustee, as supplemented
by the first supplemental indenture (relating to the 7.25% notes), the second
supplemental indenture (relating to the 7.70% notes) and the third supplemental
indenture (relating to the 6.34% notes), each dated June 25, 1999, among our
company, the subsidiary guarantors and Firstar Bank, National Association, as
trustee. Any reference to the "indenture" in this prospectus refers to the
indenture as supplemented, unless the context otherwise requires. The indenture
grants you certain rights. The new notes also will be issued under
2
<PAGE> 15
that indenture and you will have the same rights under the indenture that you
had as a holder of old notes. Any reference to "notes" in this prospectus refers
to both old notes and new notes, unless the context otherwise requires. You
should read the discussion under the headings "The Exchange Offer" and
"Description of the New Notes" for further information regarding the new notes.
<TABLE>
<S> <C>
THE EXCHANGE OFFER........................ We are offering to exchange $1,000 principal amount of
Series B:
- $250,000,000 6.34% Senior Notes due 2001;
- $350,000,000 7.25% Senior Notes due 2009; and
- $300,000,000 7.70% Senior Notes due 2029
that have been registered under the Securities Act for
each $1,000 principal amount of the corresponding
Series A:
- $250,000,000 6.34% Senior Notes due 2001;
- $350,000,000 7.25% Senior Notes due 2009; and
- $300,000,000 7.70% Senior Notes due 2029
that were issued on June 25, 1999 in a private
placement.
In order to be exchanged, an old note must be properly
tendered and accepted. All old notes that are validly
tendered and not validly withdrawn will be exchanged.
We will issue the new notes promptly after the
expiration of the exchange offer.
RESALE.................................... We believe that the new notes that you receive in the
exchange offer may be offered for resale, resold and
otherwise transferred by you without compliance with
the registration and prospectus delivery provisions of
the Securities Act if you meet the following
conditions:
(1) you acquire the new notes in the ordinary course
of your business;
(2) you are not engaging in and do not intend to
engage in a distribution of the new notes;
(3) you do not have an arrangement or understanding
with any person to participate in the distribution
of the new notes; and
(4) you are not an affiliate of our company as the
term "affiliate" is defined in Rule 405 under the
Securities Act.
If you do not meet the above conditions, you may incur
liability under the Securities Act if you transfer any
new note without delivering a prospectus meeting the
requirements of the Securities Act. We do not assume
or indemnify you against that liability. Each
broker-dealer that receives new notes in the exchange
offer for its own account in exchange for old notes
that it acquired as a result of market-making
activities or other trading activities must
acknowledge that it will deliver a prospectus meeting
the requirements of the Securities Act in connection
with any resale of the new notes. A broker-dealer may
use this
</TABLE>
3
<PAGE> 16
<TABLE>
<S> <C>
prospectus for an offer to resell, resale or other
transfer of the new notes.
EXPIRATION DATE........................... The exchange offer will expire at 5:00 p.m., New York
City time, on , 1999, unless we decide to
extend the exchange offer. We do not intend to extend
the exchange offer, although we reserve the right to
do so. If we determine to extend the exchange offer,
we do not intend to extend it beyond February 5, 2000.
CONDITIONS TO THE EXCHANGE OFFER.......... The only conditions to completing the exchange offer
are that it does not violate applicable law or any
applicable interpretation of the staff of the SEC and
that no injunction, order or decree has been issued
which would prohibit, prevent or materially impair our
ability to proceed with the exchange offer. See "The
Exchange Offer -- Conditions."
PROCEDURES FOR TENDERING OLD NOTES HELD IN
THE FORM OF BOOK-ENTRY INTERESTS.......... The old notes were issued as global securities.
Beneficial interests in the old notes that are held by
direct or indirect participants in The Depository
Trust Company through certificateless depositary
interests are shown on, and transfers of the old notes
can be made only through, records maintained in
book-entry form by DTC with respect to its
participants. If you are a holder of an old note held
in the form of a book-entry interest and you wish to
tender your old note for exchange, you must transmit
to Firstar Bank, National Association, as exchange
agent, on or before the expiration date, either:
- a properly completed and duly executed letter of
transmittal, or a facsimile of the letter of
transmittal, together with any other required
documentation; or
- a computer-generated message transmitted by means of
DTC's Automated Tender Offer Program system and
forming a part of a confirmation of book-entry
transfer in which you acknowledge and agree to be
bound by the terms of the letter of transmittal.
</TABLE>
4
<PAGE> 17
<TABLE>
<S> <C>
The exchange agent must also receive on or before the
expiration date either:
- a timely confirmation of book-entry transfer of your
old notes into the exchange agent's account at DTC, in
accordance with the procedure for book-entry
transfers described in this prospectus under the
heading "The Exchange Offer -- Book-Entry Transfer;"
or
- the documents necessary for compliance with the
guaranteed delivery procedures described below.
A letter of transmittal accompanies this prospectus.
By executing the letter of transmittal or delivering a
computer-generated message through DTC's Automated
Tender Offer Program system, you will represent to us
that, among other things:
(1) the new notes to be acquired by you in the
exchange offer are being acquired in the ordinary
course of your business;
(2) you are not engaging in and do not intend to
engage in a distribution of the new notes;
(3) you do not have an arrangement or understanding
with any person to participate in the distribution
of the new notes; and
(4) you are not our affiliate.
PROCEDURES FOR TENDERING CERTIFICATED OLD
NOTES..................................... If you are a holder of book-entry interests in the old
notes, you are entitled to receive, in limited
circumstances, in exchange for your book-entry
interests, certificated notes which are in equal
principal amounts to your book-entry interests. See
"Description of the New Notes -- Form of New Notes."
No certificated notes are issued and outstanding as of
the date of this prospectus. If you acquire
certificated old notes prior to the expiration of the
exchange offer, you must tender your certificated old
notes in accordance with the procedures described in
this prospectus under the heading "The Exchange
Offer -- Procedures for Tendering -- Certificated Old
Notes."
SPECIAL PROCEDURES FOR BENEFICIAL OWNER... If you are the beneficial owner of old notes that are
registered in the name of a broker, dealer, commercial
bank, trust company or other nominee and you wish to
tender those old notes for exchange, you should
promptly contact the registered holder and instruct
that person to tender on your behalf. If you wish to
tender those notes yourself, you must either make
appropriate arrangements to register ownership of the
old notes in your name or obtain a properly completed
bond power from the registered holder. The transfer of
registered ownership
</TABLE>
5
<PAGE> 18
<TABLE>
<S> <C>
may take considerable time and you may not be able to
complete the transfer prior to the expiration date.
See "The Exchange Offer -- Procedures for Tendering --
Procedures Applicable to All Holders."
GUARANTEED DELIVERY PROCEDURES............ If you wish to tender your old notes and:
(1) they are not immediately available;
(2) time will not permit your old notes or other
required documents to reach the exchange agent before
the expiration of the exchange offer; or
(3) you cannot complete the procedure for book-entry
transfer on a timely basis,
you may tender your old notes in accordance with the
guaranteed delivery procedures described in "The
Exchange Offer -- Procedures for Tendering --
Guaranteed Delivery Procedures."
ACCEPTANCE OF OLD NOTES AND DELIVERY OF
NEW NOTES................................. Subject to the conditions described in "The Exchange
Offer -- Conditions," we will accept for exchange all
old notes which are properly tendered in the exchange
offer prior to 5:00 p.m., New York City time, on the
expiration date. The new notes to be issued to you in
the exchange offer will be delivered promptly
following the expiration date. See "The Exchange
Offer -- Terms of the Exchange Offer."
WITHDRAWAL................................ You may withdraw the tender of your old notes at any
time prior to 5:00 p.m., New York City time, on the
expiration date. We will return to you any old notes
not accepted for exchange for any reason without
expense to you as promptly as we can after the
expiration or termination of the exchange offer.
EXCHANGE AGENT............................ Firstar Bank, National Association is serving as the
exchange agent in connection with the exchange offer.
CONSEQUENCES OF FAILURE TO EXCHANGE....... If you do not participate in the exchange offer, upon
completion of the exchange offer, the liquidity of the
market for your old notes could be adversely affected.
See "The Exchange Offer -- Consequences of Failure to
Exchange."
FEDERAL INCOME TAX CONSEQUENCES........... The exchange of the old notes will not be a taxable
event for federal income tax purposes. See "Federal
Income Tax Considerations."
USE OF PROCEEDS........................... We will not receive any cash proceeds upon completion
of the exchange offer.
</TABLE>
6
<PAGE> 19
<TABLE>
<S> <C>
SUMMARY OF THE TERMS OF THE NEW NOTES
SECURITIES OFFERED........................ $250,000,000 6.34% Senior Notes due 2001
$350,000,000 7.25% Senior Notes due 2009
$300,000,000 7.70% Senior Notes due 2029
ISSUER.................................... The Kroger Co.
MATURITY.................................. June 1, 2001
June 1, 2009
June 1, 2029
INTEREST PAYMENT DATES.................... June 1 and December 1 of each year, beginning December
1, 1999. Interest on the new notes that we will issue
will accrue from the last interest payment date on
which interest was paid on the old notes surrendered
in exchange, or, if no interest has been paid on the
old notes, from June 25, 1999, which was the date of
original issuance of the old notes.
OPTIONAL REDEMPTION....................... At our option, we may redeem some or all of the 7.25%
notes and 7.70% notes at any time at the redemption
prices listed under "Description of the New Notes --
Optional Redemption."
The 6.34% notes are not subject to optional
redemption.
GUARANTEES................................ The new notes will be guaranteed on a senior unsecured
basis by most of our subsidiaries. The guarantees will
be equal in right of payment with all other unsecured
and unsubordinated indebtedness of each guarantor
subsidiary. The guarantees are subject to release in
the circumstances described in "Description of the New
Notes -- Subsidiary Guarantees."
RANKING................................... The new notes will be senior to all of our existing
and future subordinated indebtedness and will be equal
in right of payment with all of our existing and
future unsecured senior debt.
BASIC COVENANTS OF INDENTURE.............. The indenture contains covenants that, subject to
specified exceptions, restrict our ability and the
ability of our restricted subsidiaries to:
- assume or guarantee any secured debt;
- merge with or into other companies; and
- enter into some sale and lease-back transactions.
In the future, some of our subsidiaries that we
designate as non-restricted subsidiaries will not be
subject to the covenants in the indenture. More
detailed information about these covenants is included
under "Description of New Notes -- Materials
Covenants."
</TABLE>
7
<PAGE> 20
<TABLE>
<S> <C>
FORM OF NEW NOTES......................... The new notes will be represented by one or more
global securities deposited with Firstar Bank,
National Association for the benefit of DTC. You will
not receive new notes in certificated form unless one
of the events described under the heading "Description
of the New Notes -- Form of New Notes" occurs.
Instead, beneficial interests in the new notes will be
shown on, and transfers of these interests will be
effected only through, records maintained in
book-entry form by DTC with respect to its
participants.
</TABLE>
8
<PAGE> 21
SELECTED FINANCIAL DATA
Included below is selected financial data for the periods shown. You should
read this summary in conjunction with the audited and unaudited consolidated
financial statements of Kroger and accompanying notes as well as with the
section entitled "Management's Discussion and Analysis of Financial Condition
and Results of Operations" included in Kroger's Annual Report on Form 10-K for
the fiscal year ended January 2, 1999 and in Kroger's Quarterly Report for the
period ended May 22, 1999.
<TABLE>
<CAPTION>
QUARTER ENDED FISCAL YEARS ENDED
----------------------- ------------------------------------------------------------------------
MAY 22, MARCH 21, JANUARY 2, DECEMBER 27, DECEMBER 28, DECEMBER 30, DECEMBER 31,
1999 1998 1999 1997 1996 1995 1994
(16 WEEKS) (12 WEEKS) (53 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS)
---------- ---------- ------------ ------------ ------------ ------------ ------------
(IN MILLIONS OF DOLLARS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
Sales.................. $8,789 $6,389 $28,203 $26,567 $25,171 $23,938 $22,959
Earnings before
extraordinary loss... 176 51 450 444 353 319 269
Extraordinary loss (net
of income tax
benefit) (A)......... -- (4) (39) (32) (3) (16) (27)
Net earnings........... 176 47 411 412 350 303 242
Diluted earnings per
share
Earnings before
extraordinary
loss............... 0.33 0.10 1.70 1.69 1.36 1.28 1.10
Extraordinary Loss
(A)................ -- (0.01) (0.15) (0.12) (0.01) (0.06) (0.10)
Net Earnings......... 0.33 0.09 1.55 1.57 1.35 1.22 1.00
Total assets........... 6,734 6,779 6,700 6,301 5,892 5,045 4,708
Long-term obligations,
including obligations
under capital
leases............... 3,212 3,302 3,229 3,493 3,659 3,490 3,889
Shareowners' deficit... (164) (349) (388) (785) (1,182) (1,603) (2,154)
Cash dividends per
common share......... (B) (B) (B) (B) (B) (B) (B)
</TABLE>
- ---------------
(A) The extraordinary loss relates to premiums paid to retire certain
indebtedness early and the write-off of related deferred financing costs.
(B) The Company is prohibited from paying cash dividends under the terms of its
Credit Agreement.
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<PAGE> 22
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
The tables below present the calculation of our historical and supplemental
consolidated ratio of earnings to fixed charges for the periods shown. The
supplemental consolidated ratio of earnings to fixed charges reflects the
retroactive effect given to the merger of Kroger and Fred Meyer, Inc., which has
been accounted for as a pooling of interests.
HISTORICAL CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
QUARTER ENDED FISCAL YEARS ENDED
----------------------- ------------------------------------------------------------------------
MAY 22, MARCH 21, JANUARY 2, DECEMBER 27, DECEMBER 28, DECEMBER 30, DECEMBER 31,
1999 1998 1999 1997 1996 1995 1994
(16 WEEKS) (12 WEEKS) (53 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS)
---------- ---------- ------------ ------------ ------------ ------------ ------------
(IN MILLIONS OF DOLLARS)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings
Earnings from
continuing
operations before
tax expense and
extraordinary
loss............... $280 $ 83 $ 713 $ 713 $ 567 $510 $421
Fixed charges.......... 139 113 479 482 483 490 501
Capitalized interest... (2) (2) (8) (9) (11) (7) (3)
---- ---- ------ ------ ------ ---- ----
$417 $194 $1,184 $1,186 $1,039 $993 $919
==== ==== ====== ====== ====== ==== ====
Fixed charges
Interest............. $ 79 $ 66 $ 276 $ 295 $ 312 $320 $331
Portion of rental
payments deemed to
be interest........ 60 47 203 187 171 170 170
---- ---- ------ ------ ------ ---- ----
$139 $113 $ 479 $ 482 $ 483 $490 $501
==== ==== ====== ====== ====== ==== ====
Ratio of earnings to
fixed charges........ 3.0 1.7 2.5 2.5 2.2 2.0 1.8
</TABLE>
SUPPLEMENTAL CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
QUARTER ENDED FISCAL YEARS ENDED
----------------------- ------------------------------------------------------------------------
MAY 22, MARCH 21, JANUARY 2, DECEMBER 27, DECEMBER 28, DECEMBER 30, DECEMBER 31,
1999 1998 1999 1997 1996 1995 1994
(16 WEEKS) (12 WEEKS) (53 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS) (52 WEEKS)
---------- ---------- ------------ ------------ ------------ ------------ ------------
(IN MILLIONS OF DOLLARS)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings
Earnings (loss) from
continuing
operations before
tax expense and
extraordinary
loss............... $347 ($ 7) $ 871 $ 954 $ 701 $ 591 $ 473
Fixed charges.......... 325 268 1,038 679 595 596 582
Capitalized interest... 2 2 (9) (10) (12) (11) (5)
---- ---- ------ ------ ------ ------ ------
$674 $263 $1,900 $1,623 $1,284 $1,176 $1,050
==== ==== ====== ====== ====== ====== ======
Fixed charges
Interest............. $201 $166 $ 654 $ 397 $ 361 $ 369 $ 356
Portion of rental
payments deemed to
be interest........ 124 102 384 282 234 227 226
---- ---- ------ ------ ------ ------ ------
$325 $268 $1,038 $ 679 $ 595 $ 596 $ 582
==== ==== ====== ====== ====== ====== ======
Ratio of earnings to
fixed charges........ 2.1 1.0 1.8 2.4 2.2 2.0 1.8
</TABLE>
10
<PAGE> 23
RISK FACTORS
You should carefully consider the risks described below before making a
decision to tender your old notes for exchange. Unless otherwise noted, amounts
provided below are for the combined company as if the merger between Kroger and
Fred Meyer took place prior to May 22, 1999.
OUR SIGNIFICANT INDEBTEDNESS COULD ADVERSELY AFFECT US BY REDUCING OUR
FLEXIBILITY TO RESPOND TO CHANGING BUSINESS AND ECONOMIC CONDITIONS AND
INCREASING OUR BORROWING COSTS.
As of May 22, 1999, our total outstanding indebtedness, including capital
leases and the current portion thereof, was approximately $8.5 billion,
including approximately $4.0 billion under several bank credit facilities. As of
May 22, 1999, we had credit facilities totaling $5.5 billion, with approximately
$1.5 billion available for additional borrowings under these credit facilities.
As of the date of this prospectus, we have permanently reduced the commitments
under our credit facilities by $1.5 billion. In addition, as of May 22, 1999, we
had a $500 million synthetic lease credit facility and a $125 million money
market line with unused balances of $128 million and $108 million, respectively.
This significant amount of indebtedness could reduce our ability to obtain
additional financing for working capital, acquisitions or other purposes and
could make us more vulnerable to economic downturns and competitive pressures.
Our needs for cash in the future will depend on many factors that are difficult
to predict. These factors include results of operations, the timing and cost of
acquisitions and efforts to expand existing operations.
We believe that we will have sufficient funds from all sources to meet our
needs over the next several years. We cannot assure you, however, that our
business will generate cash flow at or above current levels or that anticipated
cost savings from the merger with Fred Meyer can be fully achieved. If we are
unable to generate sufficient cash flow from operations in the future to pay our
debt and make necessary investments, we will be required to:
- refinance all or a portion of our existing debt;
- seek new borrowings;
- forego strategic opportunities; or
- delay, scale back or eliminate some aspects of our operations.
If necessary, any of these actions could have a material negative impact on
our business, financial condition or results of operations.
Some of our subsidiaries will guarantee the notes. As a result, the notes
will effectively rank equal in right of payment with approximately $8.3 billion
of indebtedness of these subsidiaries as of July 17, 1999. If one of these
subsidiaries becomes insolvent, however, the guarantee of that subsidiary could
be held by a court to be unenforceable under applicable fraudulent transfer or
similar laws. The notes will effectively rank junior in right of payment to
indebtedness of our subsidiaries that do not guarantee the notes. As of July 17,
1999, the indebtedness of the subsidiaries who will not guarantee the notes
totaled approximately $252 million.
WE CANNOT ASSURE YOU THAT KROGER AND FRED MEYER WILL BE SUCCESSFULLY COMBINED OR
THAT FRED MEYER'S RECENT ACQUISITIONS WILL BE SUCCESSFULLY COMBINED.
If we cannot successfully combine our operations we may experience a
material negative effect on our business, financial condition or results of
operations. The merger involves the combining of companies that have previously
operated separately. This involves a number of risks, including:
- demands on management related to the significant increase in size of
Kroger after the merger, including the combining of operations resulting
from Fred Meyer's recent acquisitions of Smith's Food & Drug Centers,
Inc., Quality Food Centers, Inc. and Food 4 Less Holdings, Inc.;
11
<PAGE> 24
- the diversion of management's attention to the combining of operations;
- difficulties in the combining of operations and systems, including plans
to update systems for "Year 2000" compliance;
- difficulties in the assimilation and retention of employees;
- challenges in keeping customers; and
- potential adverse short-term effects on operating results.
We may not be able to maintain the levels of operating efficiency that we
have previously achieved or might achieve separately. Because of difficulties in
combining operations, we may not be able to achieve the cost savings and other
size related benefits that we hope to achieve from the merger. Also, an element
of our growth strategy has been the pursuit of strategic acquisitions that
either expand or complement our business. Future acquisitions may further
complicate this process.
WE MAY NOT ACHIEVE THE EXPECTED COST SAVINGS AND OTHER BENEFITS OF THE MERGER
AND WE WILL HAVE SIGNIFICANT MERGER RELATED COSTS THAT WILL HAVE A MATERIAL
NEGATIVE EFFECT ON OUR RESULTS OF OPERATIONS.
We expect that the cost savings and other benefits from the merger will
exceed those which we could achieve separately. However, our cost savings
estimates are based on many assumptions, including future sales levels and other
operating results, the availability of funds for investment, the timing of
events, as well as general industry and business conditions and other matters.
Many of these factors are beyond our control. Our actual cost savings, if any,
could differ from our estimates and these differences could be material. There
may be unforeseen costs and expenses or other factors that will offset the
estimated cost savings or other components of our plan. They also may result in
delays in the realization of cost savings.
We will have substantial costs in connection with the merger. The merger
will result in a charge to operations of approximately $75 million for
transaction fees and costs. This charge represents direct costs only. The costs
of combining our companies will also result in other one-time charges to the
results of operations of the combined company. The actual amount of these
charges cannot be determined until the plan for combining the companies is
completed. We expect that these charges will have a material negative effect on
the combined company's results of operations for the second quarter of fiscal
year 1999. We also expect to have significant charges resulting from the merger
in the future.
THE GUARANTEES OF THE NOTES BY OUR SUBSIDIARIES MAY BE INADEQUATE.
Although most of our subsidiaries have guaranteed our obligation to pay the
notes, the available assets of those subsidiaries may be insufficient for these
purposes. Some of those subsidiaries are direct borrowers under, or guarantors
of, our bank credit facility.
FEDERAL AND STATE STATUTES PERMIT COURTS, UNDER SPECIFIC CIRCUMSTANCES, TO VOID
GUARANTEES AND REQUIRE THE RETURN OF PAYMENTS RECEIVED FROM GUARANTORS.
Under the U.S. Bankruptcy Code and comparable provisions of state
fraudulent transfer laws, a court has the power to void a guarantee, or to
subordinate claims in respect of a guarantee to all other debts of the
guarantor, if, among other things, at the time the guarantor incurred the
indebtedness evidenced by its guarantee, it received less than reasonably
equivalent value or fair consideration for the incurrence of the guarantee, and
either
- was insolvent or rendered insolvent by reason of that incurrence;
- was engaged in a business or transaction for which its remaining assets
constituted unreasonably small capital; or
12
<PAGE> 25
- intended to incur, or believed that it would incur, debts beyond its
ability to pay as those debts mature.
In addition, the court may void any payment by that guarantor pursuant to
its guarantee and require the return of that payment to the guarantor or to a
fund for the benefit of the creditors of the guarantor.
The measures of insolvency for these purposes will vary depending upon the
law applied in any proceeding to determine whether a fraudulent transfer has
occurred. Generally, however, a guarantor would be considered insolvent if:
- the sum of its debts, including contingent liabilities, were greater than
the fair saleable value of all of its assets;
- the present fair saleable value of its assets were less than the amount
that would be required to pay its probable liability on its existing
debts, including contingent liabilities, as they become absolute and
mature; or
- it could not pay its debts as they become due.
On the basis of our historical financial results, recent operating history
and other factors, we believe that each subsidiary that has guaranteed the
notes, after giving effect to that guarantee, will not be insolvent, will not
have unreasonably small capital for the business in which it is engaged and will
not have incurred debts beyond its ability to pay as those debts mature.
However, we cannot assure you of the particular standard that might be applied
by a court in making its determinations or that a court would agree with our
conclusions in this regard.
YOU MAY NOT BE ABLE TO SELL YOUR NOTES EASILY.
There is no established trading market for the notes and we cannot assure
you that an active or liquid trading market will develop for the notes. The
notes are expected to be eligible for trading in the PORTAL Market, a subsidiary
of The Nasdaq Stock Market, Inc. However, we do not intend to apply for listing
of the old notes, or the new notes that may be issued in exchange for the old
notes, on any securities exchange or automated dealer quotation system. The
liquidity of any market for the notes will depend upon the number of holders of
the notes, our own financial performance, the market for similar securities, the
interest of securities dealers in making a market in the notes and other
factors.
THE LIQUIDITY OF ANY MARKET FOR THE OLD NOTES IS LIKELY TO DECLINE AFTER THE
COMPLETION OF THE EXCHANGE OFFER.
After old notes are tendered and accepted in the exchange offer, the
principal amount of old notes remaining after the completion of the exchange
offer will decrease. This decrease will reduce the liquidity of the trading
market for the original notes. We cannot assure you that any trading market that
has developed for the old notes will continue to exist after the completion of
the exchange offer. Please refer to the section entitled "The Exchange
Offer -- Consequences of Failure to Exchange."
IF YOU DO NOT EXCHANGE YOUR OLD NOTES FOR NEW NOTES, YOU WILL REMAIN SUBJECT TO
TRANSFER RESTRICTIONS.
We have not registered the old notes under the federal securities laws. Old
notes that are not exchanged after the completion of this exchange offer will
remain subject to the transfer restrictions under applicable securities laws.
This means that you will not be able to transfer, sell or trade your old notes
except based upon an exemption from the registration requirements of the federal
securities laws. Please refer to the section entitled "The Exchange
Offer -- Consequences of a Failure to Exchange."
13
<PAGE> 26
USE OF PROCEEDS
This exchange offer does not involve the sale of securities for cash.
Therefore, we will not receive any proceeds from the issuance of the new notes
in exchange for the old notes. The net proceeds from the sale of old notes were
approximately $893 million, after deducting the discount to the initial
purchasers and other offering expenses that were payable by us. We used these
proceeds to prepay a portion of the amounts outstanding under our 1998 Senior
Credit Facility dated as of March 1998 between Fred Meyer and the lenders under
that credit agreement.
The interest rates for borrowings under the credit facilities, as amended,
are detailed in the supplemental consolidated financial statements attached to
our Current Report on Form 8-K dated May 28, 1999 which has been filed with the
SEC.
THE EXCHANGE OFFER
PURPOSE AND EFFECT
We issued the old notes on June 25, 1999, in a private placement. In
connection with this issuance, we and the subsidiary guarantors entered into a
registration rights agreement dated June 25, 1999, with the initial
purchasers -- Goldman, Sachs & Co., Banc One Capital Markets, Inc., Banc of
America Securities LLC, Chase Securities Inc. and Salomon Smith Barney Inc. This
registration rights agreement requires that we file a registration statement
under the Securities Act for the new notes that we are issuing in the exchange
offer and, upon the effectiveness of the registration statement, offer to you
the opportunity to exchange your notes for a like principal amount of new,
registered notes. We will issue registered notes without a restrictive legend
and, except as described below, they may be reoffered and resold by you without
registration under the Securities Act. After we complete the exchange offer, our
obligations with respect to the registration of the old notes and the registered
notes will terminate, except as provided in the last paragraph of this section.
A copy of the indenture relating to the notes and the registration rights
agreement have been filed as exhibits to the registration statement of which
this prospectus is a part. As a result of the filing and the effectiveness of
the registration statement, of which this prospectus is a part, assuming we
complete the exchange offer by February 5, 2000, certain prospective increases
in the interest rate on the old notes provided for in the registration rights
agreement will not occur.
Based on an interpretation by the staff of the SEC contained in no-action
letters issued to third parties, if you are not our "affiliate" within the
meaning of Rule 405 under the Securities Act or a broker-dealer referred to in
the next paragraph, we believe that you may offer for resale, resell or
otherwise transfer the registered notes that we are issuing to you in the
exchange offer, without compliance with the registration and prospectus delivery
provisions of the Securities Act. This interpretation, however, is based on your
representation to us that:
(1) the registered notes that we are issuing to you in the exchange offer
are acquired in the ordinary course of your business;
(2) you are not engaging in and do not intend to engage in a distribution
of the registered notes that we are issuing to you in the exchange
offer;
(3) you have no arrangement or understanding with any person to participate
in the distribution of the registered notes that we are issuing to you
in the exchange offer; and
(4) you are not our "affiliate," as defined in Rule 405 under the
Securities Act.
If you tender your notes in the exchange offer for the purpose of
participating in a distribution of the registered notes that we are issuing to
you in the exchange offer, you cannot rely on this interpretation by the staff
of the SEC. Under those circumstances, you must comply with the registration and
prospectus delivery requirements of the Securities Act in connection with a
secondary resale
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transaction. Each broker-dealer that receives registered notes in the exchange
offer for its own account in exchange for old notes that were acquired by the
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of those
registered notes. We have agreed that a broker-dealer may use this prospectus
for a period of 180 days after the expiration date, or, if earlier, when a
broker-dealer has disposed of all the new notes. See "Plan of Distribution."
If you will not receive freely tradeable registered notes in the exchange
offer or are not eligible to participate in the exchange offer, you can elect,
by indicating on the letter of transmittal and providing the additional
necessary information, to have your old notes registered in a "shelf"
registration statement on an appropriate form under Securities Act Rule 415. In
the event that we are obligated to file a shelf registration statement, we will
be required to keep the shelf registration statement effective for a period of
two years or for a shorter period that will terminate when all of the old notes
covered by the shelf registration statement have been sold pursuant to the shelf
registration statement. Other than as described in this paragraph, you will not
have the right to require us to register your old notes under the Securities
Act. See " -- Procedures for Tendering."
CONSEQUENCES OF FAILURE TO EXCHANGE
After we complete the exchange offer, if you have not tendered your old
notes, you will not have any further registration rights, except as described
above. Your old notes will continue to be subject to various restrictions on
transfer. Therefore, the liquidity of the market for your old notes could be
adversely affected upon completion of the exchange offer if you do not
participate in the exchange offer.
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions described in this prospectus
and in the letter of transmittal, we will accept all old notes validly tendered
and not withdrawn prior to 5:00 p.m., New York City time, on the expiration
date. After the trustee authenticates the registered notes, we will issue $1,000
principal amount of registered notes in exchange for each $1,000 principal
amount of old notes we accept in the exchange offer. You may tender some or all
of your old notes in the exchange offer. However, old notes may be tendered only
in integral multiples of $1,000 in principal amount.
The form and terms of the registered notes are substantially the same as
the form and terms of the old notes, except that the registered notes that we
are issuing in the exchange offer have been registered under the Securities Act
and will not bear legends restricting their transfer. We will issue the
registered notes under, and they will be entitled to the benefits of, the
indenture. The indenture also governs the old notes. The registered notes and
the old notes will be deemed one issue of notes under the indenture.
As of the date of this prospectus, $900,000,000 aggregate principal amount
of the old notes is outstanding, consisting of $250,000,000 6.34% Senior Notes
due 2001, $350,000,000 7.25% Senior Notes due 2009 and $300,000,000 7.70% Senior
Notes due 2029. This prospectus, together with the letter of transmittal, is
being sent to all registered holders and to others believed to have beneficial
interests in the old notes. We intend to conduct the exchange offer in
accordance with the applicable requirements of the Exchange Act and the rules
and regulations of the SEC.
We will be deemed to have accepted validly tendered old notes when we have
given oral or written notice of our acceptance to the exchange agent. The
exchange agent will receive the new notes from us and deliver them to the
tendering holders. If we do not accept any tendered notes because of an invalid
tender, the occurrence of various other events described in this prospectus or
otherwise, we will return certificates for any unaccepted old notes at our cost,
to the tendering holder as promptly as practicable after the expiration date.
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You will not be required to pay brokerage commissions or fees or, except as
described below under " -- Transfer Taxes," transfer taxes for the exchange of
your old notes in the exchange offer. We will pay all charges and expenses,
other than specific applicable taxes, in connection with the exchange offer. See
" -- Fees and Expenses" below.
EXPIRATION DATE; AMENDMENTS
The exchange offer will expire at 5:00 p.m., New York City time, on
, 1999, unless we determine, in our sole discretion, to extend the
exchange offer, in which case, it will expire at the later date and time to
which it is extended. We do not intend to extend the exchange offer, although we
reserve the right to do so. If we determine to extend the exchange offer, we do
not intend to extend it beyond February 5, 2000. If we extend the exchange
offer, we will give oral or written notice of the extension to the exchange
agent and give each registered holder notice by means of a press release or
other public announcement of any extension prior to 9:00 a.m., New York City
time, on the next business day after the scheduled expiration date.
We also reserve the right, in our sole discretion,
(1) to delay accepting any old notes or, if any of the conditions described
below under " -- Conditions" have not been satisfied or waived, to
terminate the exchange offer; or
(2) to amend the terms of the exchange offer in any manner, by giving oral
or written notice of the delay or termination to the exchange agent,
and by complying with Rule 14e-l(d) under the Exchange Act to the
extent that rule applies.
We acknowledge and undertake to comply with the provisions of Rule 14e-l(c)
under the Exchange Act, which requires us to pay the consideration offered, or
return the old notes surrendered for exchange, promptly after the termination or
withdrawal of the exchange offer. We will notify you as promptly as we can of
any extension, termination or amendment.
PROCEDURES FOR TENDERING
Book-Entry Interests. The old notes were issued as global securities.
Beneficial interests in the global securities, held by direct or indirect
participants in DTC, are shown on, and transfers of these interests are effected
only through, records maintained in book-entry form by DTC with respect to its
participants.
If you hold your old notes in the form of book-entry interests and you wish
to tender your old notes for exchange in the exchange offer, you must transmit
to the exchange agent on or prior to the expiration date either:
(1) a written or facsimile copy of a properly completed and duly executed
letter of transmittal, including all other documents required by the
letter of transmittal, to the exchange agent at the address shown on
the cover page of the letter of transmittal; or
(2) a computer-generated message transmitted by means of DTC's Automated
Tender Offer Program system and received by the exchange agent and
forming a part of a confirmation of book-entry transfer, in which you
acknowledge and agree to be bound by the terms of the letter of
transmittal.
In addition, in order to deliver old notes held in the form of book-entry
interests:
(1) a timely confirmation of book-entry transfer of the notes into the
exchange agent's account at DTC under the procedure for book-entry
transfers described below under " -- Book-Entry Transfer" must be
received by the exchange agent prior to the expiration date; or
(2) you must comply with the guaranteed delivery procedures described
below.
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THE METHOD OF DELIVERY OF OLD NOTES AND THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT YOUR ELECTION AND RISK.
INSTEAD OF DELIVERY BY MAIL, WE RECOMMEND THAT YOU USE AN OVERNIGHT OR HAND
DELIVERY SERVICE. IN ALL CASES, YOU SHOULD ALLOW SUFFICIENT TIME TO ASSURE
DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. YOU SHOULD NOT SEND
THE LETTER OF TRANSMITTAL OR OLD NOTES TO US. YOU MAY REQUEST THAT YOUR BROKER,
DEALER, COMMERCIAL BANK, TRUST COMPANY OR NOMINEE COMPLETE THE ABOVE
TRANSACTIONS FOR YOU.
Certificated Old Notes. Only registered holders of certificated old notes
may tender those notes in the exchange offer. If your old notes are certificated
notes and you wish to tender those notes for exchange under the exchange offer,
you must transmit to the exchange agent on or prior to the expiration date, a
written or facsimile copy of a properly completed and duly executed letter of
transmittal, including all other required documents, to the address shown below
under " -- Exchange Agent." In addition, in order to validly tender your
certificated old notes:
(1) the certificates representing your old notes must be received by the
exchange agent prior to the expiration date; or
(2) you must comply with the guaranteed delivery procedures described
below.
Procedures Applicable To All Holders. If you tender an old note and you do
not withdraw the tender prior to the expiration date, you will have made an
agreement with us in accordance with the terms and subject to the conditions
contained in this prospectus and in the letter of transmittal.
If your old notes are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee and you wish to tender your
notes, you should contact the registered holder promptly and instruct the
registered holder to tender on your behalf. If you wish to tender on your own
behalf, you must, prior to completing and executing the letter of transmittal
and delivering your old notes, either make appropriate arrangements to register
ownership of the old notes in your name or obtain a properly completed bond
power from the registered holder. The transfer of registered ownership may take
considerable time.
Signatures on a letter of transmittal or a notice of withdrawal must be
guaranteed by an eligible institution unless:
(1) old notes tendered in the exchange offer are tendered either
(a) by a registered holder who has not completed the box entitled
"Special Delivery Instructions" on the letter of transmittal; or
(b) for the account of an eligible institution; and
(2) the box entitled "Special Registration Instructions" on the letter of
transmittal has not been completed.
If signatures on a letter of transmittal or a notice of withdrawal are
required to be guaranteed, the guarantee must be by an eligible financial
institution. This includes most banks, savings and loan associations and
brokerage houses, that are participants in the Securities Transfer Agents
Medallion Program, the New York Stock Exchange Medallion Program or the Stock
Exchanges Medallion Program.
If the letter of transmittal is signed by a person other than you, your old
notes must be endorsed or accompanied by a properly completed bond power and
signed by you as your name appears on those old notes.
If the letter of transmittal or any old notes or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, those
persons should so indicate when signing. Unless we waive this
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requirement, in this instance you must submit with the letter of transmittal
proper evidence satisfactory to us of their authority to act on your behalf.
We will determine, in our sole discretion, all questions regarding the
validity, form, eligibility, including time of receipt, acceptance and
withdrawal of tendered old notes. This determination will be final and binding.
We reserve the absolute right to reject any old notes not properly tendered or
any old notes our acceptance of which would, in the opinion of our counsel, be
unlawful. We also reserve the right to waive any defects, irregularities or
conditions of tender as to particular old notes. Our interpretation of the terms
and conditions of the exchange offer, including the instructions in the letter
of transmittal, will be final and binding on all parties.
You must cure any defects or irregularities in connection with tenders of
your old notes within the time period we will determine unless we waive that
defect or irregularity. Although we intend to notify you of defects or
irregularities with respect to your tender of old notes, neither we, the
exchange agent nor any other person will incur any liability for failure to give
this notification. Your tender will not be deemed to have been made and your
notes will be returned to you if:
- you improperly tender your old notes;
- you have not cured any defects or irregularities in your tender; and
- we have not waived those defects, irregularities or improper tender.
The exchange agent will return your notes, unless otherwise provided in the
letter of transmittal, as soon as practicable following the expiration of the
exchange offer.
By tendering, you will represent to us that, among other things:
- the registered notes to be acquired by you in the exchange offer are
being acquired in the ordinary course of your business;
- you are not engaging in and do not intend to engage in a distribution of
the registered notes that you are acquiring in the exchange offer;
- you do not have an arrangement or understanding with any person to
participate in the distribution of the registered notes that you are
acquiring in the exchange offer; and
- you are not our "affiliate," as defined in Rule 405 under the Securities
Act.
In all cases, we will issue registered notes for old notes that are
accepted for exchange in the exchange offer only after timely receipt of the
following by the exchange agent:
- certificates for your old notes or a timely book-entry confirmation of
your old notes into the exchange agent's account at DTC;
- a properly completed and duly executed letter of transmittal, or a
computer-generated message instead of the letter of transmittal; and
- all other required documents.
If we do not accept any tendered old notes for any reason described in the
terms and conditions of the exchange offer or if you submit old notes for a
greater principal amount than you desire to exchange, we will return the
unaccepted or non-exchanged old notes without expense to you. In addition, in
the case of old notes tendered by book-entry transfer into the exchange agent's
account at DTC under the book-entry transfer procedures described below, we will
credit the non-exchanged old notes to your account maintained with DTC, as
promptly as practicable after the expiration or termination of the exchange
offer.
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Guaranteed Delivery Procedures. If you desire to tender your old notes and
your old notes are not immediately available or one of the situations described
in the immediately preceding paragraph occurs, you may tender if:
(1) you tender through an eligible financial institution;
(2) on or prior to 5:00 p.m., New York City time, on the expiration date,
the exchange agent receives from an eligible institution, a written or
facsimile copy of a properly completed and duly executed letter of
transmittal and notice of guaranteed delivery, substantially in the
form provided by us; and
(3) the exchange agent receives the certificates for all certificated old
notes, in proper form for transfer, or a book-entry confirmation, and
all other documents required by the letter of transmittal, within three
NYSE trading days after the date of execution of the notice of
guaranteed delivery.
You may send the notice of guaranteed delivery by facsimile transmission,
mail or hand delivery. The notice of guaranteed delivery must include:
(1) your name and address;
(2) the amount of old notes you are tendering; and
(3) a statement that your tender is being made by the notice of guaranteed
delivery and that you guarantee that within three NYSE trading days
after the execution of the notice of guaranteed delivery, the eligible
institution will deliver the following documents to the exchange agent:
(a) the certificates for all certificated old notes being tendered, in
proper form for transfer or a book-entry confirmation of tender;
(b) a written or facsimile copy of the letter of transmittal, or a
book-entry confirmation instead of the letter of transmittal; and
(c) any other documents required by the letter of transmittal.
Book-Entry Transfer. The exchange agent will establish an account for the
book-entry interests at DTC for purposes of the exchange offer promptly after
the date of this prospectus. You must deliver your book-entry interest by
book-entry transfer to the account maintained by the exchange agent at DTC. Any
financial institution that is a participant in DTC's systems may make book-entry
delivery of book-entry interests by causing DTC to transfer the book-entry
interests into the exchange agent's account at DTC in accordance with DTC's
procedures for transfer.
If one of the following situations occur:
(1) you cannot deliver a book-entry confirmation of book-entry delivery of
your book-entry interests into the exchange agent's account at DTC; or
(2) you cannot deliver all other documents required by the letter of
transmittal to the exchange agent prior to the expiration date,
then you must tender your book-entry interests according to the guaranteed
delivery procedures discussed above.
Depositary Procedures. We provide the following description of the
operations and procedures of DTC solely as a matter of convenience. These
operations and procedures are solely within the control of this settlement
system and are subject to change by it. We take no responsibility for these
operations and procedures and urge investors to contact the system or their
participants directly to discuss these matters.
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When the global notes are deposited with DTC, DTC will credit the accounts
of participants designated by the initial purchasers with portions of the
principal amount of the global notes. The ownership of interests in the global
notes will be shown on, and the transfer of these interests will be effected
only through, records maintained by DTC or by its participants. The conveyance
of notices and other communications by DTC to its participants and by the
participants to owners of beneficial interests in the notes will be governed by
arrangements among them, subject to any statutory or regulatory requirements.
Since the laws of some states require people to take physical delivery of
securities that they own, the ability to transfer beneficial interests in a
global note to these persons will be limited.
Except as described below, the global notes will not be registered in the
name of the owners of beneficial interest in the notes. These owners will not
receive certificated notes and will not be considered as the registered owners
or holders of these notes under the indenture for any purpose.
Principal and interest payments on the global notes will be made to DTC or
its nominee as the sole registered owner of the global notes. Therefore, we and
the exchange agent will not have any responsibility or liability for:
- any aspect of DTC's or its participants' records relating to, or payments
made on account of, beneficial ownership interests in the global notes;
- maintaining, supervising or reviewing any of DTC's or its participants'
records; or
- any other matter relating to the actions and practices of DTC or its
participants.
DTC has advised us that when DTC receives any payment on a global note, it
immediately credits the accounts of the relevant participants with the payment
on the payment date, in amounts proportionate to their holdings in the principal
amount of the relevant global note. Payments by the participants to owners of
beneficial interests in a global note are governed by standing instructions and
customary practices and will be the sole responsibility of the participants.
DTC will take an action permitted to be taken by a holder of notes:
- only if a participant to whose account DTC has credited the interests in
the global notes directs DTC to take that action; and
- only in respect of that portion of the principal amount of the notes as
to which that participant has given that direction.
However, if there is an event of default under the notes, DTC may exchange the
global notes for certificated notes, and distribute the certificated notes to
its participants.
Although DTC has agreed to the foregoing procedures to facilitate transfers
of interests in the global notes among participants in DTC, it is not required
to perform these procedures. Neither we nor the exchange agent will have any
responsibility for the performance by DTC or its participants of their
obligations under the rules and procedures governing their operations.
Same Day Settlement and Payment. We must make payments in respect of the
global notes by wire transfer of immediately available funds to the accounts
specified by the global note holders. For certificated notes, we will make all
payments of principal and interest:
- by wire transfer of immediately available funds to the accounts specified
by the holders of the certificated notes; or
- if no account is specified, by mailing a check to each holder's
registered address.
Interests in global notes are expected to be eligible to trade in the
PORTAL Market and to trade in DTC's Same-Day Funds Settlement System. Therefore,
permitted secondary market trading activity in
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interests in global notes will have to be settled in immediately available
funds. We expect that secondary trading in any certificated notes will also be
settled in immediately available funds.
WITHDRAWAL RIGHTS
You may withdraw tenders of your old notes at any time prior to 5:00 p.m.,
New York City time, on the expiration date.
For your withdrawal to be effective, the exchange agent must receive a
written or facsimile transmission notice of withdrawal at its address included
below under " -- Exchange Agent" prior to 5:00 p.m., New York City time, on the
expiration date.
The notice of withdrawal must:
- state your name;
- identify the specific old notes to be withdrawn, including the
certificate number or numbers and the principal amount of withdrawn
notes;
- be signed by you in the same manner as you signed the letter of
transmittal when you tendered your old notes, including any required
signature guarantees or be accompanied by documents of transfer
sufficient for the exchange agent to register the transfer of the old
notes into your name; and
- specify the name in which the old notes are to be registered, if
different from yours.
We will determine all questions regarding the validity, form, and
eligibility, including time of receipt, of withdrawal notices. Our determination
will be final and binding on all parties. Any old notes withdrawn will be deemed
not to have been validly tendered for exchange for purposes of the exchange
offer. Any old notes which have been tendered for exchange but which are not
exchanged for any reason will be returned to you without cost as soon as
practicable after withdrawal, rejection of tender, or termination of the
exchange offer. Properly withdrawn old notes may be retendered by following one
of the procedures described under " -- Procedures for Tendering" above at any
time on or prior to 5:00 p.m., New York City time, on the expiration date.
CONDITIONS
Notwithstanding any other provision of the exchange offer and subject to
our obligations under the registration rights agreement, we will not be required
to accept for exchange, or to issue registered notes in exchange for, any old
notes and may terminate or amend the exchange offer, if at any time before the
acceptance of any old notes for exchange any of the following events occur:
(1) any injunction, order or decree is issued by any court or any
governmental agency that prohibits, prevents or otherwise materially
impairs our ability to proceed with the exchange offer; or
(2) the exchange offer violates any applicable law or any applicable
interpretation of the staff of the SEC.
These conditions are for our sole benefit and we may assert them regardless
of the circumstances giving rise to any condition, subject to applicable law. We
also may waive in whole or in part at any time and from time to time any
particular condition in our sole discretion. If we waive a condition, we may be
required in order to comply with applicable securities laws, to extend the
expiration date of the exchange offer. Our failure at any time to exercise any
of the foregoing rights will not be deemed a waiver of these rights and these
rights will be deemed ongoing rights which may be asserted at any time and from
time to time.
In addition, we will not accept for exchange any old notes tendered, and we
will not register any notes that we will issue in exchange for any of those old
notes, if at the time the notes are tendered any
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stop order is threatened by the SEC or in effect with respect to the
registration statement of which this prospectus is a part or the qualification
of the indenture under the Trust Indenture Act of 1939.
The exchange offer is not conditioned on any minimum principal amount of
old notes being tendered for exchange.
EXCHANGE AGENT
We have appointed Firstar Bank, National Association as exchange agent for
the exchange offer. You should direct questions, requests for assistance and
requests for additional copies of the prospectus, the letter of transmittal and
other related documents to the exchange agent addressed as follows:
(By Registered or Certified Mail or by Hand or Overnight Courier)
Firstar Bank, N.A.
425 Walnut Street
6th Floor
Cincinnati, Ohio 45202
By Facsimile: (513) 632-5511
By Telephone: (513) 632-4278
Firstar Bank, National Association also acts as trustee under the indenture,
performs banking and other services for us, and is a lender under some of our
credit facilities.
FEES AND EXPENSES
We will not pay brokers, dealers, or others soliciting acceptances of the
exchange offer. The principal solicitation is being made by mail. Additional
solicitations, however, may be made in person or by telephone by our officers
and employees.
We will pay the estimated cash expenses to be incurred in connection with
the exchange offer. We estimate that these expenses will be approximately
$100,000 in the aggregate, which includes fees and expenses of the exchange
agent, accounting, legal, printing and related fees and expenses.
TRANSFER TAXES
You will not be obligated to pay any transfer taxes in connection with a
tender of your old notes for exchange unless you instruct us to register
registered notes in the name of, or request that old notes not tendered or not
accepted in the exchange offer be returned to, a person other than the
registered tendering holder, in which event the registered tendering holder will
be responsible for the payment of any applicable transfer tax.
ACCOUNTING TREATMENT
We will not recognize any gain or loss for accounting purposes upon the
consummation of the exchange offer. We will amortize the expense of the exchange
offer over the term of the registered notes under generally accepted accounting
principles.
DESCRIPTION OF THE NEW NOTES
In this section, the words "we," "our," "our company" and "us" refer only
to The Kroger Co., as a separate entity, and do not include any of our
subsidiaries.
We will issue the new notes under the indenture, dated June 25, 1999, as
supplemented, among our company, the subsidiary guarantors and Firstar Bank,
National Association, as trustee, which we
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entered into in connection with the issuance of the old notes. A copy of the
indenture has been filed as an exhibit to the registration statement of which
this prospectus is a part. The terms of the new notes include those stated in
the indenture and those made part of the indenture by reference to the Trust
Indenture Act of 1939.
The following description of the new notes is only a summary of the
material provisions of the indenture. We urge you to read the indenture because
that document, and not this description, defines your rights as holders of the
new notes. You may obtain a copy of the indenture by following the procedures
described under "Where You Can Find More Information."
Any reference to "notes" in this section refers to both old notes and new
notes, unless the context otherwise requires. The new notes:
- are our senior unsecured obligations;
- rank equally in right of payment with all of our unsecured and
unsubordinated senior debt;
- rank senior in right of payment to all of our existing and future
subordinated debt; and
- are effectively junior to all of our secured obligations, to the extent
of the collateral securing those obligations.
The new notes are guaranteed by each of our existing subsidiaries, except
those prohibited from so doing and those without any significant assets or
operations, subject to certain limitations described below. Future subsidiaries
of ours will be required to guarantee the new notes under the circumstances
described below under the caption " -- Certain Covenants -- Additional
Subsidiary Guarantees." The guarantees:
- are senior unsecured obligations of each guarantor;
- rank equally in right of payment with all other unsecured and
unsubordinated debt of each guarantor;
- rank senior in right of payment to all subordinated debt of each
guarantor; and
- are effectively junior to the secured obligations of each guarantor, to
the extent of the collateral securing those obligations.
PRINCIPAL, MATURITY AND INTEREST
We will issue new notes with a maximum aggregate principal amount of
$900,000,000, comprised of $250,000,000 6.34% Senior Notes due 2001;
$350,000,000 7.25% Senior Notes due 2009 and $300,000,000 7.70% Senior Notes due
2029, in denominations of $1,000 and integral multiples of $1,000. The new notes
will mature on June 1, 2001, June 1, 2009 and June 1, 2029, respectively.
Interest on the new notes will be payable semi-annually on June 1 and
December 1 of each year, commencing on December 1, 1999. We will make each
interest payment to those holders of the new notes who were holders of record on
the immediately preceding May 15 or November 15, respectively.
Interest on the new notes will accrue from June 25, 1999 or, if interest
has already been paid, from the date it was most recently paid. If you tender
your old notes and they are accepted for exchange, you will receive accrued
interest on your old notes to, but not including, the date of issuance of the
new notes. This interest will be payable with the first interest payment on the
new notes and you will not receive any payment in respect of interest on your
old notes accrued after the issuance of the new notes. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day months.
We are permitted by the indenture to issue additional senior debt in the
future.
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FORM OF NEW NOTES
The certificates representing the new notes will be issued in fully
registered form, without coupons. Except as described in the next paragraph, the
new notes will be deposited with, or on behalf of, DTC, and registered in the
name of Cede & Co., as DTC's nominee, in the form of a global note. Holders of
the new notes will own book-entry interests in the global note evidenced by
records maintained by DTC.
Book-entry interests may be exchanged for certificated notes of like tenor
and equal aggregate principal amount, if:
(1) DTC notifies us that it is unwilling or unable to continue as
depositary for the global securities or DTC at any time ceases to be a
clearing agency registered under the Exchange Act and, in either case,
a successor depositary is not appointed by us within 90 days;
(2) we determine that the book-entry interests will no longer be
represented by global notes and we execute and deliver to the trustee
instructions to that effect; or
(3) a default has occurred and is continuing with respect to the notes.
As of the date of this prospectus, no certificated notes are issued and
outstanding.
METHODS OF RECEIVING PAYMENTS ON THE NEW NOTES
All payments on the new notes will be made at the office or agency of our
company in the City of Cincinnati, State of Ohio, unless we elect to make
interest payments by check mailed to the holders at their address shown in the
register of holders.
PAYING AGENT AND REGISTRAR FOR THE NEW NOTES
The trustee will initially act as paying agent and registrar. We may change
the paying agent or registrar without prior notice to you.
TRANSFER AND EXCHANGE
You may transfer or exchange your notes in accordance with the indenture.
The registrar and the trustee may require you to furnish, among other things,
appropriate endorsements and transfer documents and we may require you to pay
any taxes and fees required by law or permitted by the indenture. We are not
required to transfer or exchange any note selected for redemption. We also are
not required to transfer or exchange any note for a period of 15 days before the
day of the mailing of a notice of redemption of the notes.
The registered holder of a new note will be treated as the owner of the new
note for all purposes.
SUBSIDIARY GUARANTEES
All of our subsidiaries, except those prohibited from so doing and those
without any significant assets or operations, will guarantee our obligations
under the new notes, subject to the limitations described below. In addition,
if, in the future, any of our existing or future subsidiaries guarantees any of
our indebtedness, that subsidiary will also be required to guarantee our
obligations under the notes, unless it is prohibited from doing so. If we
default in payment of the principal, interest or any premium due under the
notes, the guarantors will be obligated to pay these amounts.
Each guarantee will rank equal in right of payment with all other unsecured
and unsubordinated indebtedness of the guarantor and will rank senior in right
of payment to all subordinated indebtedness of the guarantor. As a result, the
notes will effectively rank equal in right of payment with approximately $7.6
billion of indebtedness of these subsidiaries as of July 17, 1999. We used the
proceeds from the sale of the old notes as part of a $900 million permanent
reduction of the commitments under our 1998 Senior Credit Facility dated as of
March 1998 between Fred Meyer and the lenders under that
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credit agreement. Kroger and the guarantors had approximately $8.3 billion of
indebtedness outstanding as of July 17, 1999, of which approximately $7.3
billion was unsecured and unsubordinated indebtedness, $273 million was secured
and unsubordinated, and the balance of which was unsecured and subordinated
indebtedness.
The notes will effectively rank junior in right of payment to indebtedness
of our subsidiaries that do not guarantee the notes. As of July 17, 1999, the
indebtedness of the subsidiaries who will not guarantee the notes totaled
approximately $252 million.
If one of these subsidiaries becomes insolvent, however, the guarantee of
that subsidiary could be held by a court to be unenforceable under applicable
fraudulent transfer or similar laws. Accordingly, the obligations of each
guarantor under its guarantee are limited to the maximum amount enforceable
under applicable fraudulent conveyance or fraudulent transfer laws. This maximum
amount will be calculated after giving effect to all other liabilities of the
guarantor and after giving effect to all contribution and other obligations
among the guarantors under the indenture. Each guarantor that makes a payment or
distribution under its guarantee will be entitled to a contribution from each
other guarantor in a pro rata amount based on the net assets of each guarantor.
For information about the meaning and consequences of a fraudulent conveyance,
we refer you to the discussion under the heading "Federal and state statutes
permit courts, under specific circumstances, to void guarantees and require the
return of payments received from guarantors" in the "Risk Factors" section of
this prospectus.
A guarantee issued by a guarantor will automatically and unconditionally be
released and discharged in the following situations if doing so will not result
in any downgrade of the notes by Moody's Investors Service and Standard & Poor's
Ratings Services:
- upon any sale, exchange or transfer to any person of all of the capital
stock, or all or substantially all of the assets, of the guarantor in a
transaction that complies with the indenture, except that such a
transaction will not release or discharge a guarantee if the guarantor
continues to be a guarantor of any of our bank credit facilities; or
- at our request at any time if we no longer have in force guarantees under
our bank credit facilities.
Except as otherwise described above, as long as the notes are guaranteed we
will add comparable release provisions to any existing debt that we modify after
the date of this prospectus to add guarantees, and to any future debt securities
(excluding asset backed securities) issued by us and guaranteed by our
subsidiaries. We have recently added guarantees to most of our existing debt
with similar release provisions as described above. Approximately $4.0 billion
of debt issued by Fred Meyer and its subsidiaries is guaranteed by Fred Meyer's
subsidiaries, and does not contain similar guarantee release provisions.
OPTIONAL REDEMPTION
The 7.25% notes and 7.70% notes will be redeemable, in whole or in part, at
our option at any time. The redemption price for these notes will equal the
greater of:
- 100% of the principal amount of the notes; and
- the sum of the present values of the remaining scheduled payments of
principal and interest on the notes being redeemed, excluding accrued
interest on the date of redemption, from the redemption date to the
maturity date. The discount to the redemption date will be made on a
semiannual basis based on a 360-day year, with each month consisting of
30 days. The discount rate will equal the equivalent yield to maturity of
U.S. Treasury securities having a comparable maturity to the notes being
redeemed, plus 10 basis points for the 7.25% notes and 15 basis points
for the 7.70% notes, plus, in each case, accrued interest to the
redemption date. The determination of the rate will be made by an agent
we appoint. Initially, that agent will be Goldman, Sachs & Co.
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The 6.34% notes are not subject to optional redemption.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of the notes to be redeemed.
Unless we default in payment of the redemption price, interest will cease to
accrue on and after the redemption date on the notes or portions of the notes
called for redemption.
If less than all of the notes are to be redeemed at any time, the trustee
will select notes for redemption by such method as the trustee deems fair and
appropriate. We will not redeem in part notes in denominations of $1,000 or
less.
MATERIAL COVENANTS
The indenture provides that the following covenants will apply to us and to
our restricted subsidiaries. A "restricted subsidiary" is any subsidiary that is
not a "non-restricted subsidiary." We may designate a subsidiary as a
non-restricted subsidiary if our board of directors declares in good faith that
a subsidiary is not of material importance, either singularly, or together with
all other non-restricted subsidiaries, to the business of our company and our
consolidated subsidiaries taken as a whole. Non-restricted subsidiaries are not
subject to any of the covenants contained in the indenture. A "subsidiary" is an
entity that we directly or indirectly control, including partnerships in which
we or our subsidiaries own a greater than 50% interest.
The covenants applicable to the notes would not necessarily afford holders
protection in the event of a highly leveraged or other transaction involving us
or in the event of a material adverse change in our financial condition or
results of operation, and the notes do not contain any other provisions that are
designed to afford protection in the event of a highly leveraged transaction
involving us.
Limitations on Liens. We covenant that, so long as any notes remain
outstanding, neither we nor any of our restricted subsidiaries will issue,
assume or guarantee any secured debt or other agreement comparable to secured
debt unless these notes and, if we choose, other debt ranking equally to these
notes also is so secured on an equal basis. This restriction will not apply to
the following:
(1) liens on any assets of any corporation existing at the same time the
corporation becomes a restricted subsidiary provided that the lien
does not extend to any of our other property or that of any other
restricted subsidiaries;
(2) liens existing on assets acquired by us, to secure the purchase price
of assets, or to obtain a release of liens from any of our other
property, incurred no later than 18 months after the acquisition,
assumption, guarantee, or, in the case of real estate, completion of
construction and commencement of operations;
(3) liens securing indebtedness owing by any restricted subsidiary to us
or another restricted subsidiary;
(4) liens on any assets existing upon acquisition of a corporation through
merger or by acquisition of all or substantially all of the assets by
us or a restricted subsidiary;
(5) liens in favor of the U.S., a foreign country, or any political
subdivision to secure payments of debt incurred to finance the
purchase of assets;
(6) liens on our or any of our restricted subsidiaries' assets existing on
the date of the indenture, provided that those liens secure only those
obligations which they secure on the date of the indenture or any
extension, renewal or replacement of those liens;
(7) any extension, renewal or replacement (or successive extensions,
renewals or replacements) in whole or in part, of any lien referred to
in (1) through (6) above;
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(8) some statutory liens or other similar liens arising in the ordinary
course of our or any of our restricted subsidiaries' business, or some
liens arising out of governmental contracts;
(9) some pledges, deposits or liens made or arising under worker's
compensation or similar legislation or in some other circumstances;
(10) some liens in connection with legal proceedings, including some liens
arising out of judgments or awards;
(11) liens for some taxes or assessments, landlord's liens, mechanic's
liens and liens and charges incidental to the conduct of the business,
or the ownership of our or any of our restricted subsidiaries' assets
which were not incurred in connection with the borrowing of money and
which do not in our opinion, materially impair the use of the assets
in the operation of our business or that of a restricted subsidiary or
the value of the assets for its purposes; or
(12) any other liens not included above, which together with amounts
described in paragraph (1) of the next section do not exceed 10% of
our consolidated net tangible assets.
Limitation on Sale and Lease-Back Transactions. We and our restricted
subsidiaries will not sell and lease-back for a term greater than three years
under a capital lease any material real property or operating assets unless:
(1) we could incur secured debt on that property equal to the present value
of rentals under the lease without having to equally secure the notes;
or
(2) the sale proceeds equal or exceed the fair market value of the property
and the net proceeds are used within 180 days to acquire material real
property or operating assets or to purchase or redeem notes offered
hereby or long term debt, including capital leases, that are senior to
or rank on parity with these notes.
This restriction does not apply to sale and lease-back transactions of
material real property or operating assets acquired or constructed after 18
months prior to the date of the indenture as long as a commitment for the sale
and lease-back is made within 18 months of acquisition, in the case of operating
assets, and of completion of construction and commencement of operations, in the
case of material real property.
Merger and Consolidation. The indenture provides that we will not merge or
consolidate with any corporation, partnership or other entity and will not sell,
lease or convey all or substantially all of our assets to any entity, unless:
- we are the surviving entity, or the surviving or successor entity is a
corporation or partnership organized under the laws of the United States
or a State thereof or the District of Columbia and expressly assumes all
our obligations under the indenture and the notes; and
- immediately after the transaction, we or the surviving or successor
entity are not in default in the performance of the covenants and
conditions of the indenture.
Additional Subsidiary Guarantees. The indenture provides that we will not
permit any of our subsidiaries to become a guarantor with respect to any
indebtedness of our company unless that subsidiary simultaneously executes and
delivers a supplemental indenture pursuant to which it will become a guarantor
under the indenture. Notwithstanding the preceding sentence, any such guarantee
of the notes will provide by its terms that it will automatically and
unconditionally be released and discharged under the circumstances described
above under the caption "-- Subsidiary Guarantees."
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For the purposes of the proceeding paragraph, "indebtedness" means with
respect to any individual or entity:
(1) every obligation of the individual or entity for money borrowed;
(2) every obligation of the individual or entity evidenced by bonds,
debentures, notes or other similar instruments;
(3) every obligation of the individual or entity issued or assumed as the
deferred purchase price of property, every conditional sale obligation
and every obligation under any title retention agreement, in each case
if on terms permitting any portion of the purchase price to be paid
beyond one year from the date of purchase (but excluding trade accounts
payable arising in the ordinary course of business which are not
overdue by more than 90 days or which are being contested in good
faith);
(4) every obligation of the individual or entity issued or contracted for
as payment in consideration of the purchase by the individual or entity
or an affiliate of the individual or entity of all of the corporate
stock or rights to the corporate state or substantially all of the
assets of another individuals or entities or a merger or consolidation
to which the individual or entity or an affiliate of the individual or
entity was a party;
(5) every obligation of the type referred to in paragraphs (1) through (4)
of other individuals or entities and all dividends at which at any
particular time its corporate trust business shall be administered.
Reports. The indenture requires us to provide the trustee with any
information, documents or reports required to be filed with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act within 15 days after they are required
to be filed with the SEC.
EVENTS OF DEFAULT
Holders of notes have special rights if an event of default occurs and is
not cured, as described later in this subsection. An event of default occurs
when:
- we fail to pay the principal or any premium on a note on its due date;
- we fail to pay interest on a note within 30 days of its due date;
- we fail to deposit any sinking fund payment on its due date;
- we fail to comply with any other restrictive covenant described in this
prospectus or any other term of the indenture, and this failure continues
for 60 days after we receive written notice of it;
- we default in any of our other indebtedness in excess of $50,000,000, and
the default results in an acceleration of maturity; or
- we take specified actions relating to our bankruptcy, insolvency or
reorganization.
If an event of default on the notes of any series occurs and is continuing,
the trustee or the holders of at least 25% in principal amount of all of the
outstanding notes of that series may require us to immediately repay all of the
principal and interest due on the notes of that series. The holders of a
majority in principal amount of all of the notes of that series may rescind this
accelerated payment requirement, if the rescission would not conflict with any
judgment or decree by a court and if all existing events of default have been
cured or waived.
If an event of default occurs and is continuing, the trustee may pursue any
remedy available to it to collect payment or to enforce the performance of any
provision of the outstanding notes of that series or the indenture.
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The holders of a majority in principal amount of the outstanding notes of
that series may generally waive an existing default and its consequences.
MODIFICATION OF THE INDENTURE
The indenture may be amended without the consent of any holder of the
notes:
- to cure any ambiguity, defect or inconsistency;
- to permit a successor to assume our obligations under the indenture;
- to add additional covenants for the benefit of the holders;
- to add additional events of default;
- to add or change provisions necessary to facilitate the issuance of the
notes; or
- to entitle the notes to the benefit of security.
The indenture may be amended with the written consent of the holders of at
least 50% in principal amount of the notes of the series affected by the
amendment. Holders of at least 50% in principal amount of the notes of the
series affected by the amendment may waive our compliance with any provision of
the indenture or the notes by giving notice to the trustee.
However, no amendment or waiver that:
- changes the maturity of principal or any installment of principal or
interest;
- reduces the amount of principal or interest or premium payable on
redemption;
- reduces the amount of the notes whose holders must consent to an
amendment or waiver;
- modifies provisions related to rights of holders to redeem notes at their
option; or
- changes other rights of holders as specifically identified in the
indenture
will be effective against any holder of the series of notes affected by the
amendment or waiver without the holder's consent.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
We may, at our option and at any time, elect to have all of our obligations
discharged with respect to the outstanding notes and all obligations of the
guarantors discharged with respect to their subsidiary guarantees except for
certain obligations. This is known as "legal defeasance." We may not exercise
our legal defeasance option with respect to:
- the rights of holders of outstanding notes to receive payments in respect
of the principal of, premium, if any, or interest, if any, on those notes
when these payments are due from the trust referred to below;
- our obligations with respect to the notes concerning the issuance of
temporary notes, registration of notes, mutilated, destroyed, lost or
stolen notes and the maintenance of an office or agency for payment and
money for security payments held in trust;
- the rights, powers, trusts, duties and immunities of the trustee; and
- the legal defeasance provisions of the indenture.
In addition, we may, at our option and at any time, elect to have the
obligations of our company and the guarantors released with respect to certain
covenants that are specified in the indenture. This is known as "covenant
defeasance." If we exercise our covenant defeasance option, any failure to
comply with those covenants will not constitute a default or event of default
with respect to the notes. In the
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event covenant defeasance occurs, certain events (not including non-payment,
bankruptcy, receivership, rehabilitation and insolvency events) described under
"Events of Default" will no longer constitute an event of default with respect
to the notes.
Legal defeasance or covenant defeasance may be effected only if, among
other things:
- we irrevocably deposit with the trustee cash or U.S. government
obligations as trust funds in an amount certified to be sufficient to pay
at maturity the principal of and interest on all outstanding notes;
- no default or event of default under the indenture shall have occurred
and be continuing either on the date of the deposit or at any time in the
period ending on the 121st day after the date of the deposit;
- in the case of legal defeasance, we deliver to the trustee an opinion of
counsel to the effect that the holders of the notes will not recognize
income, gain or loss for U.S. federal income tax purposes as a result of
the defeasance and that defeasance will not otherwise alter the holders'
U.S. federal income tax treatment of principal and interest payments on
the notes. The opinion must be based on a ruling of the Internal Revenue
Service or a change in U.S. federal income tax law occurring after the
date of the indenture, since that result would not occur under current
tax law;
- legal defeasance or covenant defeasance will not result in a breach or
violation of, or constitute a default under the indenture or any material
agreement or instrument to which we are a party or by which we are bound;
and
- we deliver to the trustee an officer's certificate and an opinion of
counsel, each stating that all conditions precedent relating to the legal
defeasance or the covenant defeasance have been complied with.
CONCERNING THE TRUSTEE
If the trustee becomes a creditor of our company or any subsidiary
guarantor, the indenture limits its right to obtain payment of claims in certain
cases, or to realize on certain property received in respect of any claim as
security or otherwise. The trustee may acquire our obligations for its own
account. The trustee performs banking and other services for us, and is a lender
under some of our credit facilities. The trustee will be permitted to engage in
other transactions; however, if it acquires any conflicting interest it must
eliminate that conflict or resign.
The holders of a majority in principal amount of the then outstanding notes
will have the right to direct the time, method and place of conducting any
proceeding for exercising any remedy available to the trustee, subject to
certain exceptions. In the performance of its duties, the trustee is entitled to
indemnification for any act which would involve it in expense or liability and
will not be liable as a result of any action taken in connection with the
performance of its duties except for its own gross negligence or default. The
trustee is protected in acting upon any direction or document reasonably
believed by it to be genuine and to be signed by the proper party or parties or
upon the opinion or advice of counsel. The trustee may resign upon written
notice to us as provided in the indenture.
FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of certain U.S. federal income tax
considerations that may be relevant to the exchange of old notes for new notes
pursuant to the exchange offer and the ownership or disposition of new notes.
This summary is based on U.S. federal tax laws in effect on the date of this
prospectus. All of these laws and authorities are subject to change, and any
change could be effective retroactively. No assurances can be given that any
change in these laws or authorities will not affect the accuracy of the
discussion described in this summary.
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This summary deals only with holders that hold the old notes and new notes
as capital assets as defined in the U.S. federal tax laws. This summary does not
address tax considerations applicable to:
- investors who did not acquire an old note at the initial offering from
Goldman, Sachs & Co., Banc One Capital Markets, Inc., Banc of America
Securities LLC, Chase Securities Inc. or Salomon Smith Barney for the
original offering price of the old note or who do not acquire the new
note pursuant to the exchange offer;
- special classes of holders, such as dealers in securities or currencies,
banks, tax-exempt organizations, or life insurance companies; and
- persons that hold old notes or new notes as a hedge (or as a hedged item)
or as part of a straddle or conversion transaction.
YOU SHOULD CONSULT YOUR OWN TAX ADVISOR IN DETERMINING THE TAX TREATMENT OF
THE EXCHANGE OF OLD NOTES FOR NEW NOTES PURSUANT TO THE EXCHANGE OFFER AND OF
THE OWNERSHIP AND DISPOSITION OF NEW NOTES, INCLUDING THE APPLICATION TO YOUR
PARTICULAR CIRCUMSTANCES OF THE TAX CONSIDERATIONS DISCUSSED BELOW AND OF ANY
RELEVANT FOREIGN, STATE, LOCAL OR OTHER TAX LAWS.
As used herein, the term "United States Holder" means a holder of old notes
who or that is:
- a citizen or resident of the United States;
- a domestic corporation or partnership;
- an estate the income of which is subject to regular U.S. federal income
taxation regardless of its source; or
- a trust if a court within the United States is able to exercise primary
supervision over the administration of that trust and one or more U.S.
persons have the authority to control all substantial decisions of that
trust.
UNITED STATES HOLDERS
The following discussion applies to you if you are a U.S. Holder.
Treatment of Exchange of Old Notes for New Notes. An exchange of old notes
for new notes will be considered for U.S. federal income tax purposes to be a
modification of the old notes. The tax consequences of such a modification
depend on whether the modification is considered to be significant. The exchange
of an old note for a new note pursuant to the exchange offer will not constitute
a significant modification of the old note for United States federal income tax
purposes. Therefore, you will treat the new note as a continuation of the old
note. As a result, you will have no United States federal income tax
consequences from exchanging an old note for a new note pursuant to the exchange
offer. Your adjusted tax basis and holding period in the new note will be the
same as you had in the old note immediately before the exchange.
Payments of Interest. You will include in your gross income as ordinary
income the stated interest payable on a new note at the time it is accrued or
received, in accordance with your method of accounting for United States federal
income tax purposes.
Disposition of the New Notes. When you sell, exchange, or otherwise
dispose of a new note, or when we retire the new note (collectively, a
"disposition") you generally will recognize capital gain or loss equal to the
difference between the amount you realize and your adjusted tax basis in the new
note. However, to the extent such amount is attributable to accrued interest, it
will be treated as ordinary interest income. The capital gain or loss will be
long-term capital gain or loss if your holding period for the new note exceeds
one year at the time of the disposition.
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UNITED STATES TAXATION OF NON-U.S. HOLDERS
The following discussion applies to you if you are not a U.S. Holder,
referred to below as a "Non-U.S. Holder."
Treatment of Exchange of Old Notes for New Notes. An exchange of an old
note for a new note pursuant to the exchange offer will not constitute a taxable
exchange of the old note for Non-U.S. Holders. See "United States
Holders -- Treatment of Exchange of Old Notes for New Notes."
Payments of Interest. In general, if you are a non-U.S. holder, payments
of interest you receive will not be subject to United States federal withholding
tax, provided that one of the following conditions applies:
- you do not actually or constructively own 10% or more of the total
combined voting power of all classes of our stock entitled to vote, you
are not a controlled foreign corporation that is related to us actually
or constructively through stock ownership and you, as beneficial owner of
the new note, provide us or our agent under penalties of perjury your
name and address and you certify that you are a Non-U.S. Holder;
- the interest you receive on the new note is effectively connected with
your conduct of a trade or business within the United States and you
comply with certain reporting requirements; or
- you are entitled to the benefits of an income tax treaty under which the
interest is exempt from United States withholding tax and you comply with
certain reporting requirements.
Payments of interest not exempt from the United States federal withholding
tax as described above will be subject to withholding tax at the rate of 30%
(subject to reduction under an applicable income tax treaty).
Disposition of the New Notes. As a Non-U.S. Holder you generally will not
be subject to United States federal income tax (and generally no tax will be
withheld) with respect to gain you realize on the disposition of a new note,
unless one of the following conditions applies:
- the gain is effectively connected with your United States trade or
business;
- you are an individual who is present in the United States for 183 or more
days during the taxable year of the disposition and certain other
requirements are satisfied; or
- you are subject to certain provisions of United States federal income tax
law applicable to certain expatriates.
Effectively Connected Income. If interest and other payments you receive
with respect to the new notes (including proceeds from the disposition of the
new notes) are effectively connected with your conduct of a trade or business
within the United States (or you are otherwise subject to United States federal
income taxation on a net basis with respect to your ownership of the new notes),
you will generally be subject to other rules described above under "United
States Taxation of United States Holders" (subject to any modification provided
under an applicable income tax treaty). You may also be subject to the "branch
profits tax" if you are a corporation.
BACKUP WITHHOLDING AND INFORMATION REPORTING
Certain non-corporate United States Holders may be subject to backup
withholding at a rate of 31% on payments of principal, premium and interest on,
and the proceeds of the disposition of, the new notes. In general, backup
withholding will be imposed only if you:
- fail to furnish your taxpayer identification number ("TIN"), which, for
an individual, would be your Social Security number;
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- you furnish an incorrect TIN; or
- you have been notified by the IRS that you are subject to backup
withholding tax for failure to report interest or dividend payments.
In addition, if you are a United States Holder, payments of principal and
interest will generally be subject to information reporting. You should consult
your tax advisor regarding qualification of the payments for exemption from
backup withholding and the procedure for obtaining such an exemption, if
applicable.
Backup withholding and information reporting generally will not apply to
interest payments made to you if you are a Non-U.S. Holder of a new note and you
provide the certification described under "United States Taxation of Non-U.S.
Holders -- Payments of Interest" or otherwise establish an exemption from backup
withholding. If you are a Non-U.S. Holder, payment of the proceeds of a
disposition of the new notes by or through a United States office of a broker
generally will be subject to backup withholding at a rate of 31% and information
reporting unless you certify that you are a Non-U.S. Holder under penalties of
perjury or otherwise establish an exemption. Payments of the proceeds of a
disposition of the new notes by or through a foreign office of a United States
broker, a controlled foreign corporation for United States federal income tax
purposes or a foreign broker with certain relationships to the United States
generally will be subject to information reporting, but not backup withholding.
The amount of any backup withholding will be allowed as a credit against
your United States federal income tax liability and may entitle you to a refund,
provided that you furnish the required information to the IRS.
RECENTLY ISSUED TREASURY REGULATIONS
The U.S. Treasury Department recently issued final Treasury regulations
governing information reporting and the certification procedures regarding
withholding and backup withholding on certain amounts paid to Non-U.S. Holders.
The new Treasury regulations are generally effective for payments made after
December 31, 2000. In addition, the new Treasury regulations would alter the
procedures for claiming the benefits of an income tax treaty and may change the
certification procedures relating to the receipt by intermediaries of payments
on behalf of a beneficial owner of a new note. With some exceptions, the new
regulations treat a payment to a foreign partnership as a payment directly to
the partners. Prospective investors should consult their tax advisors concerning
the effect, if any, of such new Treasury regulations on an investment in the new
notes.
PLAN OF DISTRIBUTION
Based on interpretations by the SEC described in no-action letters issued
to third parties in similar transactions, we believe that the new notes issued
in the exchange offer in exchange for the old notes may be offered for resale,
resold and otherwise transferred by holders without compliance with the
registration and prospectus delivery provisions of the Securities Act, as long
as the new notes are acquired in the ordinary course of such holders' business
and the holders are not engaged in, and do not intend to engage in, and have no
arrangement or understanding with any person to participate in, a distribution
of new notes. This position does not apply to any holder that is:
(1) an "affiliate" of ours within the meaning of Rule 406 under the
Securities Act;
(2) a broker-dealer who acquired notes directly from us; or
(3) a broker-dealer who acquired notes as a result of market-making or
other trading activities.
Each broker-dealer that receives new notes for its own account pursuant to
the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of those notes. This prospectus, as it may be amended
or supplemented from time to time, may be used by a broker-dealer in connection
with resales of new notes received in exchange for old notes that had been
acquired as a
33
<PAGE> 46
result of market-making or other trading activities. We have agreed that, for a
period of 180 days after the expiration date of the exchange offer, we will make
this prospectus, as it may be amended or supplemented, available to any
broker-dealer for use in connection with any such resale.
We will not receive any proceeds from any sales of notes by broker-dealers.
New notes received by broker-dealers for their own account pursuant to the
exchange offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on those notes or a combination of those methods, at market prices
prevailing at the time of resale, at prices related to prevailing market prices
or at negotiated prices. These resales may be made directly to purchasers or to
or through brokers or dealers who may receive compensation in the form of
commissions or concessions from the selling broker-dealer or the purchasers of
the new notes. Any broker-dealer that resells registered notes that it received
for its own account pursuant to the exchange offer and any broker or dealer that
participates in a distribution of those notes may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit on any
such resale of those notes and any commission or concessions received by any
participating broker or dealer may be deemed to be underwriting compensation
under the Securities Act. The letter of transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
LEGAL MATTERS
The validity of the new notes and the guarantees will be passed upon for
Kroger by Paul Heldman, Esq., Senior Vice President, Secretary and General
Counsel of Kroger. As of May 30, 1999, Mr. Heldman owned approximately 44,137
shares of Kroger common stock and had options to acquire an additional 204,583
shares.
EXPERTS
The financial statements incorporated in this prospectus by reference to
Kroger's Annual Report on Form 10-K for the year ended January 2, 1999 and to
the Current Report on Form 8-K dated August 20, 1999 have been so incorporated
in reliance on the reports (which contain an explanatory paragraph that
describes a change in Kroger's application of the LIFO method of accounting for
store inventories) of PricewaterhouseCoopers LLP, independent accountants, given
on the authority of said firm as experts in auditing and accounting.
The financial statements incorporated in this prospectus by reference to
Kroger's Current Report on Form 8-K dated May 10, 1999 have been so incorporated
in reliance on the report of PricewaterhouseCoopers LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
The supplemental consolidated financial statements incorporated in this
prospectus by reference to the Current Report on Form 8-K dated May 28, 1999,
have been so incorporated in reliance on the report (which contains an
explanatory paragraph that describes a change in Kroger's application of the
LIFO method of accounting for store inventories and an explanatory paragraph
that describes the retroactive effect given to the merger of Kroger and Fred
Meyer, Inc., which has been accounted for as a pooling of interests) of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
The consolidated financial statements of Fred Meyer, Inc. as of January 30,
1999 and January 31, 1998 and for the fiscal years ended January 30, 1999,
January 31, 1998 and February 1, 1997, incorporated in this prospectus by
reference to the Fred Meyer, Inc. Form 10-K, for the fiscal year ended January
30, 1999 have been audited by Deloitte & Touche LLP, independent auditors, as
stated in their report included in that Form 10-K.
34
<PAGE> 47
FORWARD-LOOKING STATEMENTS
This prospectus contains, or incorporates by reference, certain statements
that may be deemed "forward-looking statements" within the meaning of Section
27A of the Securities Act and Section 21E of the Securities Exchange Act of
1934. All statements, other than statements of historical facts, that address
activities, events or developments that we intend, expect, project, believe or
anticipate will or may occur in the future are forward-looking statements. These
statements are based on certain assumptions and assessments made by our
management in light of its experience and its perception of historical trends,
current conditions, expected future developments and other factors it believes
to be appropriate. The forward-looking statements included in this prospectus
are also subject to a number of material risks and uncertainties, including but
not limited to economic, competitive, governmental and technological factors
affecting our operations, markets, products, services and prices, and other
factors discussed in our filings under the Securities Act and the Exchange Act.
Prospective investors are cautioned that these forward-looking statements are
not guarantees of future performance and that actual results, developments and
business decisions may differ from those envisaged by these forward-looking
statements.
35
<PAGE> 48
LIST OF SUBSIDIARY GUARANTORS
<TABLE>
<CAPTION>
NAME OF GUARANTOR JURISDICTION OF ORGANIZATION
----------------- ----------------------------
<S> <C>
Alpha Beta Company.......................................... California
Bay Area Warehouse Stores, Inc.............................. California
Bell Markets, Inc........................................... California
Cala Co..................................................... Delaware
Cala Foods, Inc............................................. California
CB&S Advertising Agency, Inc................................ Oregon
City Market, Inc............................................ Colorado
Compare, Inc................................................ Delaware
Crawford Stores, Inc........................................ California
Dillon Companies, Inc....................................... Kansas
Dillon Real Estate Co., Inc................................. Kansas
Distribution Trucking Company............................... Oregon
Drug Distributors, Inc...................................... Indiana
FM Holding Corporation...................................... Delaware
FM, Inc..................................................... Utah
FM Retail Services, Inc..................................... Washington
Food 4 Less GM, Inc......................................... California
Food 4 Less Holdings, Inc................................... Delaware
Food 4 Less Merchandising, Inc.............................. California
Food 4 Less of California, Inc.............................. California
Food 4 Less of Southern California, Inc..................... Delaware
Fred Meyer, Inc............................................. Delaware
Fred Meyer Jewelers, Inc.................................... Delaware
Fred Meyer of Alaska, Inc................................... Alaska
Fred Meyer of California, Inc............................... California
Fred Meyer Stores, Inc...................................... Delaware
Grand Central, Inc.......................................... Utah
Henpil, Inc................................................. Texas
Hughes Markets, Inc......................................... California
Hughes Realty, Inc.......................................... California
Inter-American Foods, Inc................................... Ohio
Jackson Ice Cream Co., Inc.................................. Kansas
JH Properties, Inc.......................................... Washington
Junior Food Stores of West Florida, Inc..................... Florida
J.V. Distributing, Inc...................................... Michigan
KRGP Inc.................................................... Ohio
KRLP Inc.................................................... Ohio
The Kroger Co. of Michigan.................................. Michigan
Kroger Dedicated Logistics Co............................... Ohio
</TABLE>
36
<PAGE> 49
<TABLE>
<CAPTION>
NAME OF GUARANTOR JURISDICTION OF ORGANIZATION
----------------- ----------------------------
<S> <C>
Kroger Limited Partnership I................................ Ohio
Kroger Limited Partnership II............................... Ohio
KU Acquisition Corporation.................................. Washington
Kwik Shop, Inc.............................................. Kansas
Merksamer Jewelers, Inc..................................... California
Mini Mart, Inc.............................................. Wyoming
Peyton's-Southeastern, Inc.................................. Tennessee
QFC Sub, Inc................................................ Washington
Quality Food Centers, Inc................................... Washington
Quality Food Holdings, Inc.................................. Delaware
Quality Food, Inc........................................... Delaware
Quik Stop Markets, Inc...................................... California
Ralphs Grocery Company...................................... Delaware
Richie's Inc................................................ Texas
Rocket Newco, Inc........................................... Texas
Roundup Co.................................................. Washington
Saint Lawrence Holding Company.............................. Delaware
Second Story, Inc........................................... Washington
Smith's Beverage of Wyoming, Inc............................ Wyoming
Smith's Food & Drug Centers, Inc............................ Delaware
Smitty's Equipment Leasing, Inc............................. Delaware
Smitty's Super Valu, Inc.................................... Delaware
Smitty's Supermarkets, Inc.................................. Delaware
THGP Co., Inc............................................... Pennsylvania
THLP Co., Inc............................................... Pennsylvania
Topvalco, Inc............................................... Ohio
Treasure Valley Land Company, L.C........................... Idaho
Turkey Hill, L.P............................................ Pennsylvania
Vine Court Assurance Incorporated........................... Vermont
Wells Aircraft, Inc......................................... Kansas
Western Property Investment Group, Inc...................... California
Wydiv, Inc.................................................. Texas
</TABLE>
37
<PAGE> 50
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1701.13 of the Ohio General Corporation Law, inter alia,
empowers an Ohio corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding (other than an action by or in the right of the corporation)
by reason of the fact that such person is or was a director, officer, employee
or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
other enterprise, against expenses, including attorneys' fees, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him or her in
connection with such action, suit or proceeding if he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Similar indemnity is authorized for such person against expenses (including
attorneys' fees) actually and reasonably incurred in connection with the defense
or settlement of any such threatened, pending or completed action or suit if
such person acted in good faith and in a manner he or she reasonably believed to
be in or not opposed to the best interests of the corporation; provided, that
(unless a court of competent jurisdiction otherwise provides), such a person
shall not have been adjudged liable to the corporation.
Unless ordered by a court, any such indemnification may be made only as
authorized in each specific case upon a determination by the shareholders or
disinterested directors or by independent legal counsel in a written opinion
that indemnification is proper because the indemnitee has met the applicable
standard of conduct. Provided, however, that to the extent that a director,
officer, employee or agent has been successful on the merits or otherwise in
defense of any action, suit or proceeding or in defense of any claim, issue or
matter therein, the corporation shall indemnify him or her against expenses,
including attorneys' fees, actually and reasonably incurred in connection with
the action, suit or proceeding.
Under The Kroger Co. (the "Company") Regulations (or bylaws), each
present or former director, officer or employee of the Company and each person
who is serving or shall have served at the request of the Company as a director,
officer, or employee of another corporation (and his heirs, executors and
administrators) will be indemnified by the Company against expenses actually and
necessarily incurred by him, and also against expenses, judgments, decrees,
fines, penalties, or amounts paid in settlement, in connection with the defense
of any pending or threatened action, suit, or proceeding, criminal or civil, to
which he is or may be made a party by reason of being or having been such
director, officer, or employee, provided (1) he is adjudicated or determined not
to have been negligent or guilty of misconduct in the performance of his duty to
the Company or such other corporation, (2) he is determined to have acted in
good faith in what he reasonably believed to be the best interest of the Company
or of such other
II-1
<PAGE> 51
corporation, and (3) in any matter the subject of a criminal action, suit, or
proceeding, he is determined to have had no reasonable cause to believe that his
conduct was unlawful.
Section 1701.13 of the Ohio General Corporation Law further authorizes
a corporation to purchase and maintain insurance on behalf of any person who is
or was a director, officer, employee or agent of the corporation or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation or enterprise, against any liability asserted
against him or her and incurred in any such capacity, or arising out of his or
her status as such, whether or not the corporation would otherwise have the
power to indemnify him or her under Section 1701.13. The Company maintains such
directors' and officers' reimbursement and liability insurance pursuant to
policies with aggregate limits of $125 million.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Exhibit Description
- ------- -----------
3.1 Amended Articles of Incorporation of the Company (incorporated by
reference to Exhibit 3.1 of the Company's Quarterly Report on Form
10-Q for the Quarter ended October 3, 1998).
3.2 Regulations (Bylaws) of the Company (incorporated by reference to
Exhibit 4.2 of the Company's Registration Statement on Form S-3 (No.
33-57552), dated January 28, 1993.)
4.1 Indenture dated as of June 25, 1999, between the Company and Firstar
Bank, National Association, as Trustee (filed herewith).
4.2 First Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of June 25, 1999, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
relating to the 7.25% Senior Notes (filed herewith).
4.3 Second Supplemental Indenture dated as of June 25, 1999, to
Indenture dated as of June 25, 1999, by and among the Company, the
Guarantors listed therein and Firstar Bank, National Association, as
Trustee, relating to the 7.70% Senior Notes (filed herewith).
4.4 Third Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of June 25, 1999, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
relating to the 6.34% Senior Notes (filed herewith).
4.5 Registration Rights Agreement dated as of June 25, 1999, among the
Company, the Guarantors listed therein, Goldman Sachs & Co., Banc
One Capital Markets, Inc., Banc of America Securities LLC, Chase
Securities Inc. and Salomon Smith Barney (filed herewith).
4.6 Second Supplemental Indenture dated as of June 25, 1999, to
Indenture dated as of October 15, 1993, by and among the Company,
the Guarantors
II-2
<PAGE> 52
listed therein and Firstar Bank, National Association, as Trustee,
adding guarantors to the Company's existing debt (filed herewith).
4.7 Fourth Supplemental Indenture dated as of June 25, 1999, to
Indenture dated as of May 1, 1998, by and among the Company, the
Guarantors listed therein and Firstar Bank, National Association, as
Trustee, adding guarantors to the Company's existing debt (filed
herewith).
4.8 Fourth Supplemental Indenture dated June 25, 1999, to Indenture
dated as of July 15, 1996, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
adding guarantors to the Company's existing debt (filed herewith).
4.9 Seventh Supplemental Indenture dated as of June 25, 1999, to
Indenture dated as of April 1, 1992, by and among the Company, the
Guarantors listed therein and Harris Trust and Savings Bank, as
Trustee, adding guarantors to the Company's existing debt (filed
herewith).
4.10 Second Supplemental Indenture dated as of July 30, 1999, to
Indenture dated as of March 11, 1998, between Fred Meyer, Inc., the
Guarantors listed therein and The First National Bank of Chicago,
adding guarantors to existing debt of Fred Meyer, Inc. and its
subsidiaries (filed herewith).
4.11 Third Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of June 1, 1995, between Ralphs Grocery Company (Food 4
Less Supermarkets, Inc.), the Guarantors listed therein and Norwest
Bank Minnesota, N.A., adding guarantors to existing debt of Fred
Meyer, Inc. and its subsidiaries (filed herewith).
4.12 Fourth Supplemental Indenture dated as of July 30, 1999, to
Indenture dated as of March 30, 1993, between Ralphs Grocery
Company, the Guarantors listed therein and United States Trust
Company, adding guarantors to existing debt of Fred Meyer, Inc. and
its subsidiaries (filed herewith).
4.13 Third Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of June 1, 1995, between Ralph Grocery Company (Food 4 Less
Supermarkets, Inc.), the Guarantors listed therein and United States
Trust Company of New York, adding guarantors to existing debt of
Fred Meyer, Inc. and its subsidiaries (filed herewith).
4.14 Second Supplemental Indenture dated as of July 30, 1999, to
Indenture dated as of March 19, 1997, between Quality Food Centers,
Inc., the Guarantors listed therein and First Trust, N.A., adding
guarantors to existing debt of Fred Meyer, Inc. and its subsidiaries
(filed herewith).
4.15 Second Supplemental Indenture dated as of July 30, 1999, to
Indenture dated as of May 23, 1996, between Smith's Food & Drug
Centers, Inc., the Guarantors listed therein and State Street Bank
and Trust Company, adding guarantors to existing debt of Fred Meyer,
Inc. and its subsidiaries (filed herewith).
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<PAGE> 53
5.1 Opinion of Paul W. Heldman, Esq., Senior Vice President, Secretary
and General Counsel to the Company (filed herewith).
12.1 Statement re: computation of ratios (included in the prospectus).
21.1 List of Company's subsidiaries (filed herewith).
23.1 Consent of PricewaterhouseCoopers LLP, independent auditors for the
Company (filed herewith).
23.2 Consent of Deloitte & Touche LLC, independent auditors for the
Company (filed herewith).
23.3 Consent of Paul W. Heldman, Esq. (included in Exhibit 5.1).
24.1 Powers of Attorney of directors and officers of the Company (filed
herewith).
25.1 Statement of Eligibility of Trustee on Form T-1 (incorporated by
reference to the existing exhibit 25.1 to the Company's Current
Report on Form 8-K dated April 30, 1999).
99.1 Form of Letter of Transmittal (filed herewith).
99.2 Form of Notice of Guaranteed Delivery (filed herewith).
99.3 Form of Tender Instructions (filed herewith).
II-4
<PAGE> 54
ITEM 22. UNDERTAKINGS
The undersigned Registrants hereby undertake:
(A)
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
(a) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933 (the "Securities Act").
(b) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high end
of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) (ss.230.424(b) of
this chapter) if, in the aggregate, the changes in
volume and price represent no more than 20% change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement.
(c) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(B) That, for purposes of determining any liability under the Securities
Act, each filing of the registrant's annual report pursuant to section
13(a) or section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration
II-5
<PAGE> 55
statement shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(C) That, insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provision described under
Item 20 or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person
of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
(D) To respond to requests for information that is incorporated by
reference into the Prospectus pursuant to Item 4, 10(b), 11, or 13 of
this form, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally
prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through
the date of responding to the request.
(E) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved
therein, that was not the subject of and included in the registration
statement when it became effective.
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<PAGE> 56
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Cincinnati,
State of Ohio, on August 20, 1999.
THE KROGER CO.
By: /s/ Bruce M. Gack
---------------------
Bruce M. Gack
Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ * Chairman of the Board of Directors, Director, August 20, 1999
- ------------------------- and Chief Executive Officer (Principal
Joseph A. Pichler Executive Officer)
/s/ * Executive Vice President and Chief Financial August 20, 1999
- ------------------------- Officer (Principal Financial Officer)
W. Rodney McMullen
/s/ * Vice President and Corporate Controller August 20, 1999
- ------------------------- (Principal Accounting Officer)
J. Michael Schlotman
/s/ * Director August 20, 1999
- -------------------------
Reuben V. Anderson
/s/ * Director August 20, 1999
- -------------------------
Robert D. Beyer
/s/ * Director August 20, 1999
- -------------------------
Ronald W. Burkle
/s/ * Director August 20, 1999
- -------------------------
John L. Clendenin
/s/ * Director and President August 20, 1999
- -------------------------
David B. Dillon
/s/ * Director August 20, 1999
- -------------------------
Carlton J. Jenkins
</TABLE>
II-7
<PAGE> 57
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ * Director August 20, 1999
- ------------------------
Bruce Karatz
/s/ * Director August 20, 1999
- ------------------------
John T. LaMacchia
/s/ * Director August 20, 1999
- ------------------------
Edward M. Liddy
/s/ * Director August 20, 1999
- ------------------------
Robert G. Miller
/s/ * Director August 20, 1999
- ------------------------
Clyde R. Moore
/s/ * Director August 20, 1999
- ------------------------
T. Ballard Morton, Jr.
/s/ * Director August 20, 1999
- ------------------------
Thomas H. O'Leary
/s/ * Director August 20, 1999
- ------------------------
Katherine D. Ortega
/s/ * Director August 20, 1999
- ------------------------
Martha R. Seger
/s/ * Director August 20, 1999
- ------------------------
Bobby S. Shackouls
/s/ * Director August 20, 1999
- ------------------------
James D. Woods
</TABLE>
*By: /s/ Bruce M. Gack
---------------------
Bruce M. Gack
Attorney in Fact
II-8
<PAGE> 58
CO-REGISTRANT OFFICERS AND DIRECTORS
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
All as of
August 20, 1999
<S> <C> <C>
Dillon Companies, Inc.
/s/ DAVID B. DILLON Director and Chairman of
- --------------------------------------------- the Board (Principal
David B. Dillon Executive Officer)
/s/ FRANK J. REMAR Director and
- --------------------------------------------- Vice President,
Frank J. Remar Secretary and Treasurer
(Principal Financial
Officer)
/s/ SCOTT M. HENDERSON Vice President and
- --------------------------------------------- Controller (Principal
Scott M. Henderson Accounting Officer)
Director
- ---------------------------------------------
Warren F. Bryant
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Assistant Secretary
Paul W. Heldman
Director and Vice
- --------------------------------------------- President
W. Rodney McMullen
Drug Distributors, Inc.
/s/ J. ROBERT RICE Director and President
- --------------------------------------------- (Principal Executive
J. Robert Rice Officer)
</TABLE>
II-9
<PAGE> 59
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
/s/ LAWRENCE M. TURNER Treasurer (Principal
- --------------------------------------------- Financial and Accounting
Lawrence M. Turner Officer)
/s/ PAUL W. HELDMAN Director and Secretary
- ---------------------------------------------
Paul W. Heldman
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
Henpil, Inc.
/s/ LEE BREWER President and Director
- --------------------------------------------- (Principal Executive
Lee Brewer Officer)
/s/ STEVEN MCMILLAN Director, Treasurer, and
- --------------------------------------------- Secretary (Principal
Steven McMillan Financial and Accounting
Officer)
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
Inter-American Foods, Inc.
/s/ GEOFFREY J. COVERT President (Principal
- --------------------------------------------- Executive Officer)
Geoffrey J. Covert
/s/ W. RODNEY MCMULLEN Vice President and Chief
- --------------------------------------------- Financial Officer
W. Rodney McMullen (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Treasurer (Principal
- --------------------------------------------- Accounting Officer)
Lawrence M. Turner
/s/ PAUL W. HELDMAN Director and Vice
- --------------------------------------------- President
Paul W. Heldman
</TABLE>
II-10
<PAGE> 60
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
/s/ BRUCE M. GACK Director
- ---------------------------------------------
Bruce M. Gack
J. V. Distributing, Inc.
/s/ W. RODNEY MCMULLEN President (Principal
- --------------------------------------------- Executive Officer)
W. Rodney McMullen
/s/ LAWRENCE M. TURNER Treasurer (Principal
- --------------------------------------------- Financial and Accounting
Lawrence M. Turner Officer)
/s/ PAUL W. HELDMAN Director and Vice
- --------------------------------------------- President
Paul W. Heldman
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
/s/ BRUCE M. GACK Director and Secretary
- ---------------------------------------------
Bruce M. Gack
KRGP Inc.
KRLP Inc.
Kroger Limited Partnership I
By KRGP, Inc., the General Partner
Kroger Limited Partnership II
By KRGP, Inc., the General Partner
/s/ JOSEPH A. PICHLER Director, Chairman of the
- --------------------------------------------- Board, and Chief Executive
Joseph A. Pichler Officer (Principal
Executive Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Financial and Accounting
Officer)
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
</TABLE>
II-11
<PAGE> 61
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
/s/ BRUCE M. GACK Director
- ---------------------------------------------
Bruce M. Gack
The Kroger Co. of Michigan
/s/ M. MARNETTE PERRY Director, Chairman of the
- --------------------------------------------- Board, and Chief Executive
M. Marnette Perry Officer (Principal
Executive Officer)
/s/ KENNETH CORNISH Treasurer and Secretary
- --------------------------------------------- (Principal Financial and
Kenneth Cornish Accounting Officer)
Director and Vice
- --------------------------------------------- President
Paul W. Heldman
/s/ JAMES PERUN Director and Vice
- --------------------------------------------- President-Operations
James Perun
Kroger Dedicated Logistics Co.
/s/ PAUL W. HELDMAN Director and President
- --------------------------------------------- (Principal Executive
Paul W. Heldman Officer)
/s/ LAWRENCE M. TURNER Director, Vice President,
- --------------------------------------------- and Treasurer (Principal
Lawrence M. Turner Financial and Accounting
Officer)
Director
- ---------------------------------------------
W. Rodney McMullen
Peyton's Southeastern, Inc.
/s/ J. ROBERT RICE Director and President
- --------------------------------------------- (Principal Executive
J. Robert Rice Officer)
</TABLE>
II-12
<PAGE> 62
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
/s/ ROBERT WELTY Treasurer and Secretary
- --------------------------------------------- (Principal Financial and
Robert Welty Accounting Officer)
Director
- ---------------------------------------------
Terry L. Cox
/s/ PAUL W. HELDMAN Director and Assistant
- --------------------------------------------- Secretary
Paul W. Heldman
Rocket Newco, Inc.
/s/ THOMAS P. O'BRIEN, JR. Director and President
- --------------------------------------------- (Principal Executive
Thomas P. O'Brien, Jr. Officer)
/s/ STEVEN MCMILLAN Vice President, Treasurer,
- --------------------------------------------- and Secretary (Principal
Steven McMillan Financial and Accounting
Officer)
Director and Vice
- --------------------------------------------- President
Lee Brewer
Topvalco, Inc.
/s/ JAMES E. HODGE President (Principal
- --------------------------------------------- Executive Officer)
James E. Hodge
/s/ LAWRENCE M. TURNER Director, Vice President,
- --------------------------------------------- Treasurer, and Assistant
Lawrence M. Turner Secretary (Principal
Financial and Accounting
Officer)
Director and Vice
- --------------------------------------------- President
Paul W. Heldman
/s/ THOMAS P. O'BRIEN, JR. Director and Assistant
- --------------------------------------------- Secretary
Thomas P. O'Brien, Jr.
</TABLE>
II-13
<PAGE> 63
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Vine Court Assurance Incorporated
/s/ J. MICHAEL SCHLOTMAN Director and President
- --------------------------------------------- (Principal Executive
J. Michael Schlotman Officer)
/s/ LAWRENCE M. TURNER Treasurer (Principal
- --------------------------------------------- Financial Officer)
Lawrence M. Turner
/s/ DAN L. MCDANIEL Director, Controller, and
- --------------------------------------------- Chief Accounting Officer
Dan L. McDaniel (Principal Accounting
Officer)
/s/ BRUCE M. GACK Director and Vice
- --------------------------------------------- President
Bruce M. Gack
Director and Vice
- --------------------------------------------- President
Robert Dinges
Director and Assistant
- --------------------------------------------- Secretary
Douglas C. Pierson
Wydiv, Inc.
/s/ JACK CANNON Director and President
- --------------------------------------------- (Principal Executive
Jack Cannon Officer)
/s/ STEVEN MCMILLAN Director, Vice President,
- --------------------------------------------- Treasurer and Secretary
Steven McMillan (Principal Financial and
Accounting Officer)
Director
- ---------------------------------------------
Thomas P. O'Brien, Jr.
</TABLE>
II-14
<PAGE> 64
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
City Market, Inc.
/s/ ANTHONY PRINSTER President (Principal
- --------------------------------------------- Executive Officer)
Anthony Prinster
/s/ RONALD WARREN Vice President, Secretary,
- --------------------------------------------- and Treasurer (Principal
Ronald Warren Financial Officer)
/s/ STAN HOSMAN Controller (Principal
- --------------------------------------------- Accounting Officer)
Stan Hosman
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
/s/ FRANK J. REMAR Director
- ---------------------------------------------
Frank J. Remar
Director
- ---------------------------------------------
Warren F. Bryant
Dillon Real Estate Co., Inc.
/s/ FRANK J. REMAR Director and President
- --------------------------------------------- (Principal Executive
Frank J. Remar Officer)
/s/ SCOTT M. HENDERSON Secretary and Treasurer
- --------------------------------------------- (Principal Financial and
Scott M. Henderson Accounting Officer)
/s/ DAVID B. DILLON Director and Vice
- --------------------------------------------- President
David B. Dillon
Director and Vice
- --------------------------------------------- President
Warren F. Bryant
Jackson Ice Cream Co., Inc.
/s/ JOHN D. COX President (Principal
- --------------------------------------------- Executive Officer)
John D. Cox
</TABLE>
II-15
<PAGE> 65
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
/s/ FRANK J. REMAR Director, Vice President,
- --------------------------------------------- Secretary, and Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
Junior Food Stores of West Florida, Inc.
/s/ MARK SALISBURY President (Principal
- --------------------------------------------- Executive Officer)
Mark Salisbury
/s/ FRANK J. REMAR Director, Vice President,
- --------------------------------------------- Secretary, and Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
Kwik Shop, Inc.
/s/ HENRY R. WAGUESPACK President (Principal
- --------------------------------------------- Executive Officer)
Henry R. Waguespack
/s/ FRANK J. REMAR Director, Vice President,
- --------------------------------------------- Secretary, and Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
</TABLE>
II-16
<PAGE> 66
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Mini Mart, Inc.
/s/ SAMUEL L. SHARP President (Principal
- --------------------------------------------- Executive Officer)
Samuel L. Sharp
/s/ FRANK J. REMAR Director, Secretary, and
- --------------------------------------------- Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
Quik Stop Markets, Inc.
/s/ VAN S. TARVER President (Principal
- --------------------------------------------- Executive Officer)
Van S. Tarver
/s/ FRANK J. REMAR Director, Vice President,
- --------------------------------------------- Secretary, and Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
</TABLE>
II-17
<PAGE> 67
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
THGP Co., Inc.
THLP Co., Inc.
Turkey Hill, L.P.
By THGP Co., Inc.,
its General Partner
/s/ WARREN F. BRYANT Director and President
- --------------------------------------------- (Principal Executive
Warren F. Bryant Officer)
/s/ FRANK J. REMAR Director, President, Chief
- --------------------------------------------- Financial Officer, and
Frank J. Remar Treasurer (Principal
Financial and Accounting
Officer)
Director, Vice President,
- --------------------------------------------- and Assistant Secretary
Robert Moeder
Wells Aircraft, Inc.
/s/ GARY W. CROW President (Principal
- --------------------------------------------- Executive Officer)
Gary W. Crow
/s/ FRANK J. REMAR Director, Vice President,
- --------------------------------------------- Secretary, and Treasurer
Frank J. Remar (Principal Financial and
Accounting Officer)
/s/ DAVID B. DILLON Director
- ---------------------------------------------
David B. Dillon
Director
- ---------------------------------------------
Warren F. Bryant
Fred Meyer Stores, Inc.
/s/ MARY F. SAMMONS President and Chief
- --------------------------------------------- Executive Officer
Mary F. Sammons (Principal Executive
Officer)
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
</TABLE>
II-18
<PAGE> 68
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director
- ---------------------------------------------
Paul W. Heldman
Fred Meyer, Inc.
CB&S Advertising Agency, Inc.
Distribution Trucking Company
FM, Inc.
FM Holding Corporation
Grand Central, Inc.
FM Retail Services, Inc.
Fred Meyer of Alaska, Inc.
Fred Meyer of California, Inc.
Roundup Co.
JH Properties, Inc.
Smith's Beverage of Wyoming, Inc.
Smitty's Supermarkets, Inc.
Smitty's Super Valu, Inc.
Compare, Inc.
Saint Lawrence Holding Company
Smitty's Equipment Leasing, Inc.
Treasure Valley Land Company, L.C.
Western Property Investment Group, Inc.
Hughes Markets, Inc.
Hughes Realty, Inc.
KU Acquisition Corporation
/s/ WARREN F. BRYANT President and Chief
- --------------------------------------------- Executive Officer
Warren F. Bryant (Principal Executive
Officer)
</TABLE>
II-19
<PAGE> 69
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
Fred Meyer Jewelers, Inc.
Merksamer Jewelers, Inc.
/s/ MICHAEL H. DON Chief Executive Officer
- --------------------------------------------- (Principal Executive
Michael H. Don Officer)
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
</TABLE>
II-20
<PAGE> 70
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Smith's Food & Drug Centers, Inc.
/s/ WARREN F. BRYANT Chief Executive Officer
- --------------------------------------------- (Principal Executive
Warren F. Bryant Officer)
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
Richie's, Inc.
/s/ ARTURO YE Director and President
- --------------------------------------------- (Principal Executive
Arturo Ye Officer)
/s/ KEITH C. LARSON Director, Vice President,
- --------------------------------------------- and Secretary (Principal
Keith C. Larson Financial and Accounting
Officer)
Director
- ---------------------------------------------
Paul W. Heldman
</TABLE>
II-21
<PAGE> 71
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Quality Food Centers, Inc.
Quality Food, Inc.
Quality Food Holdings, Inc.
QFC Sub, Inc.
Second Story, Inc.
/s/ MICHAEL HUSE President and Chief
- --------------------------------------------- Executive Officer
Michael Huse (Principal Executive
Officer)
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
</TABLE>
II-22
<PAGE> 72
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
Food 4 Less Holdings, Inc.
Ralphs Grocery Company
Cala Co.
Bay Area Warehouse Stores, Inc.
Bell Markets, Inc.
Cala Foods, Inc.
Crawford Stores, Inc.
Food 4 Less of Southern California, Inc.
Alpha Beta Company
Food 4 Less GM, Inc.
Food 4 Less of California, Inc.
Food 4 Less Merchandising, Inc.
/s/ SAMMY K. DUNCAN President (Principal
- --------------------------------------------- Executive Officer)
Sammy K. Duncan
/s/ ROBERT B. DIMOND Vice President and Chief
- --------------------------------------------- Financial Officer
Robert B. Dimond (Principal Financial
Officer)
/s/ LAWRENCE M. TURNER Vice President and
- --------------------------------------------- Treasurer (Principal
Lawrence M. Turner Accounting Officer)
Director
- ---------------------------------------------
Joseph A. Pichler
/s/ ROBERT G. MILLER Director
- ---------------------------------------------
Robert G. Miller
/s/ PAUL W. HELDMAN Director, Vice President,
- --------------------------------------------- and Secretary
Paul W. Heldman
</TABLE>
II-23
<PAGE> 73
INDEX OF EXHIBITS
Exhibit Description
- ------- -----------
3.1 Amended Articles of Incorporation of the Company (incorporated by
reference to Exhibit 3.1 of the Company's Quarterly Report on Form
10-Q for the Quarter ended October 3, 1998).
3.2 Regulations (Bylaws) of the Company (incorporated by reference to
Exhibit 4.2 of the Company's Registration Statement on Form S-3 (No.
33-57552), dated January 28, 1993.)
4.1 Indenture dated as of June 25, 1999, between the Company and Firstar
Bank, National Association, as Trustee (filed herewith).
4.2 First Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of June 25, 1999, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
relating to the 7.25% Senior Notes (filed herewith).
4.3 Second Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of June 25, 1999, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
relating to the 7.70% Senior Notes (filed herewith).
4.4 Third Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of June 25, 1999, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
relating to the 6.34% Senior Notes (filed herewith).
4.5 Registration Rights Agreement dated as of June 25, 1999, among the
Company, the Guarantors listed therein, Goldman Sachs & Co., Banc One
Capital Markets, Inc., Banc of America Securities LLC, Chase
Securities Inc. and Salomon Smith Barney (filed herewith).
4.6 Second Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of October 15, 1993, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
adding guarantors to the Company's existing debt (filed herewith).
4.7 Fourth Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of May 1, 1998, by and among the Company, the Guarantors
listed therein and Firstar Bank, National Association, as Trustee,
adding guarantors to the Company's existing debt (filed herewith).
4.8 Fourth Supplemental Indenture dated June 25, 1999, to Indenture dated
as of July 15, 1996, by and among the Company, the Guarantors listed
therein and Firstar Bank, National Association, as Trustee, adding
guarantors to the Company's existing debt (filed herewith).
II-24
<PAGE> 74
4.9 Seventh Supplemental Indenture dated as of June 25, 1999, to Indenture
dated as of April 1, 1992, by and among the Company, the Guarantors
listed therein and Harris Trust and Savings Bank, as Trustee, adding
guarantors to the Company's existing debt (filed herewith).
4.10 Second Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of March 11, 1998, between Fred Meyer, Inc., the Guarantors
listed therein and The First National Bank of Chicago, adding
guarantors to existing debt of Fred Meyer, Inc. and its subsidiaries
(filed herewith).
4.1 Third Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of June 1, 1995, between Ralphs Grocery Company (Food 4 Less
Supermarkets, Inc.), the Guarantors listed therein and Norwest Bank
Minnesota, N.A., adding guarantors to existing debt of Fred Meyer,
Inc. and its subsidiaries (filed herewith).
4.12 Fourth Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of March 30, 1993, between Ralphs Grocery Company, the
Guarantors listed therein and United States Trust Company, adding
guarantors to existing debt of Fred Meyer, Inc. and its subsidiaries
(filed herewith).
4.13 Third Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of June 1, 1995, between Ralph Grocery Company (Food 4 Less
Supermarkets, Inc.), the Guarantors listed therein and United States
Trust Company of New York, adding guarantors to existing debt of Fred
Meyer, Inc. and its subsidiaries (filed herewith).
4.14 Second Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of March 19, 1997, between Quality Food Centers, Inc., the
Guarantors listed therein and First Trust, N.A., adding guarantors to
existing debt of Fred Meyer, Inc. and its subsidiaries (filed
herewith).
4.15 Second Supplemental Indenture dated as of July 30, 1999, to Indenture
dated as of May 23, 1996, between Smith's Food & Drug Centers, Inc.,
the Guarantors listed therein and State Street Bank and Trust Company,
adding guarantors to existing debt of Fred Meyer, Inc. and its
subsidiaries (filed herewith).
5.1 Opinion of Paul W. Heldman, Esq., Senior Vice President, Secretary and
General Counsel to the Company (filed herewith).
12.1 Statement re: computation of ratios (included in the prospectus).
21.1 List of Company's subsidiaries (filed herewith).
23.1 Consent of PricewaterhouseCoopers LLP, independent auditors for the
Company (filed herewith).
23.2 Consent of Deloitte & Touche LLC, independent auditors for the Company
(filed herewith).
23.3 Consent of Paul W. Heldman, Esq. (included in Exhibit 5.1).
24.1 Powers of Attorney of directors and officers of the Company (filed
herewith).
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<PAGE> 75
25.1 Statement of Eligibility of Trustee on Form T-1 (incorporated by
reference to the existing exhibit 25.1 to the Company's Current Report
on Form 8-K dated April 30, 1999).
99.1 Form of Letter of Transmittal (filed herewith).
99.2 Form of Notice of Guaranteed Delivery (filed herewith).
99.3 Form of Tender Instructions (filed herewith).
II-26
<PAGE> 1
Exhibit-4.1
================================================================================
THE KROGER CO.
TO
Firstar Bank, National Association
Trustee
----------
INDENTURE
Dated as of June 25, 1999
----------
SENIOR DEBT SECURITIES
================================================================================
<PAGE> 2
THE KROGER CO.
Certain Sections of this Indenture relating to
Sections 310 through 318, inclusive, of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
<S> <C>
' 310(a)(1) ............................................... 609
(a)(2) ............................................... 609
(a)(3) ............................................... Not Applicable
(a)(4) ............................................... Not Applicable
(b) ............................................... 608
610
' 311(a) ............................................... 613
(b) ............................................... 613
' 312(a) ............................................... 701
702(a)
(b) ............................................... 702(b)
(c) ............................................... 702(c)
' 313(a) ............................................... 703(a)
(b) ............................................... 703(a)
(c) ............................................... 703(a)
(d) ............................................... 703(b)
' 314(a) ............................................... 704
(a)(4) ............................................... 101
1004
(b) ............................................... Not Applicable
(c)(1) ............................................... 102
(c)(2) ............................................... 102
(c)(3) ............................................... Not Applicable
(d) ............................................... Not Applicable
(e) ............................................... 102
' 315(a) ............................................... 601
(b) ............................................... 602
(c) ............................................... 601
(d) ............................................... 601
(e) ............................................... 514
' 316(a) ............................................... 101
(a)(1)(A) ............................................... 502
512
(a)(1)(B) ............................................... 513
(a)(2) ............................................... Not Applicable
(b) ............................................... 508
(c) ............................................... 104(c)
' 317(a)(1) ............................................... 503
(a)(2) ............................................... 504
(b) ............................................... 1003
' 318(a) ............................................... 107
- -------------------
</TABLE>
-2-
<PAGE> 3
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
-3-
<PAGE> 4
TABLE OF CONTENTS
----------
<TABLE>
<CAPTION>
Page
----
<S> <C>
PARTIES............................................................................................ 1
RECITALS OF THE COMPANY............................................................................ 1
ARTICLE ONE
-----------
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions............................................................. 1
Act..................................................................... 2
Administrative Agents................................................... 2
Affiliate; control...................................................... 2
Authenticating Agent.................................................... 3
Bank Agreement.......................................................... 3
Board of Directors...................................................... 3
Board Resolution........................................................ 3
Business Day............................................................ 3
Capital Stock........................................................... 3
Commission.............................................................. 3
Company................................................................. 4
Company Request; Company Order.......................................... 4
Corporate Trust Office.................................................. 4
corporation............................................................. 4
Defaulted Interest...................................................... 4
Depositary.............................................................. 4
Event of Default........................................................ 4
Exchange Act............................................................ 4
Global Security......................................................... 4
Holder.................................................................. 5
Indebtedness............................................................ 5
Indenture............................................................... 5
interest................................................................ 6
Interest Payment Date................................................... 6
Lien.................................................................... 6
Maturity................................................................ 6
Officers' Certificate................................................... 6
Opinion of Counsel...................................................... 7
Original Issue Discount Security........................................ 7
Outstanding............................................................. 7
Paying Agent............................................................ 8
Person.................................................................. 8
Place of Payment........................................................ 8
Predecessor Security.................................................... 9
Redemption Date......................................................... 9
Redemption Price........................................................ 9
Regular Record Date..................................................... 9
Securities.............................................................. 9
</TABLE>
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<PAGE> 5
-ii-
<TABLE>
<CAPTION>
Page
----
<S> <C>
Security Register and Security
Registrar.............................................................. 9
Special Record Date..................................................... 9
Stated Maturity......................................................... 9
Subsidiary.............................................................. 9
Trustee................................................................. 10
Trust Indenture Act..................................................... 10
Vice President.......................................................... 10
Wholly-owned Subsidiary................................................. 10
Section 102. Compliance Certificates and Opinions.................................... 10
Section 103. Form of Documents Delivered to Trustee.................................. 11
Section 104. Acts of Holders; Record Dates........................................... 12
Section 105. Notices, Etc., to Trustee and Company................................... 14
Section 106. Notice to Holders; Waiver............................................... 15
Section 107. Conflict with Trust Indenture Act....................................... 15
Section 108. Effect of Headings and
Table of Contents...................................................... 16
Section 109. Successors and Assigns.................................................. 16
Section 110. Separability Clause..................................................... 16
Section 111. Benefits of Indenture................................................... 16
Section 112. Governing Law........................................................... 16
Section 113. Legal Holidays.......................................................... 16
ARTICLE TWO
-----------
SECURITY FORMS
Section 201. Forms Generally......................................................... 17
Section 202. Form of Face of Security................................................ 20
Section 203. Form of Reverse of Security............................................. 20
Section 204. Form of Legend for Global Securities.................................... 25
Section 205. Form of Trustee's Certificate of
Authentication......................................................... 26
ARTICLE THREE
-------------
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series.................................... 26
Section 302. Denominations........................................................... 30
Section 303. Execution, Authentication, Delivery
and Dating............................................................. 31
Section 304. Temporary Securities.................................................... 33
Section 305. Registration, Registration of Transfer
and Exchange........................................................... 34
Section 306. Mutilated, Destroyed, Lost and Stolen
Securities............................................................. 36
Section 307. Payment of Interest; Interest Rights
Preserved.............................................................. 37
Section 308. Persons Deemed Owners................................................... 39
</TABLE>
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<PAGE> 6
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<TABLE>
<CAPTION>
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----
<S> <C>
Section 309. Cancellation............................................................ 39
Section 310. Computation of Interest................................................. 40
ARTICLE FOUR
------------
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture................................. 40
Section 402. Application of Trust Money.............................................. 42
ARTICLE FIVE
------------
REMEDIES
Section 501. Events of Default....................................................... 42
Section 502. Acceleration of Maturity; Rescission
and Annulment.......................................................... 45
Section 503. Collection of Indebtedness and Suits
for Enforcement by Trustee............................................. 47
Section 504. Trustee May File Proofs of Claim........................................ 48
Section 505. Trustee May Enforce Claims Without
Possession of Securities............................................... 48
Section 506. Application of Money Collected.......................................... 49
Section 507. Limitation on Suits..................................................... 49
Section 508. Unconditional Right of Holders to
Receive Principal, Premium and
Interest............................................................... 50
Section 509. Restoration of Rights and Remedies...................................... 51
Section 510. Rights and Remedies Cumulative.......................................... 51
Section 511. Delay or Omission Not Waiver............................................ 51
Section 512. Control by Holders...................................................... 52
Section 513. Waiver of Past Defaults................................................. 52
Section 514. Undertaking for Costs................................................... 53
Section 515. Waiver of Usury, Stay or Extension Laws................................. 53
ARTICLE SIX
-----------
THE TRUSTEE
Section 601. Certain Duties and Responsibilities..................................... 53
Section 602. Notice of Defaults...................................................... 54
Section 603. Certain Rights of Trustee............................................... 54
Section 604. Not Responsible for Recitals or
Issuance of Securities................................................. 56
Section 605. May Hold Securities..................................................... 56
Section 606. Money Held in Trust..................................................... 56
Section 607. Compensation and Reimbursement.......................................... 57
Section 608. Disqualification; Conflicting
Interests.............................................................. 57
</TABLE>
-iii-
<PAGE> 7
-iv-
<TABLE>
<CAPTION>
Page
----
<S> <C>
Section 609. Corporate Trustee Required;
Eligibility............................................................ 58
Section 610. Separate Trustee; Resignation and Removal;
Appointment of Successor............................................... 58
Section 611. Acceptance of Appointment by Successor.................................. 60
Section 612. Merger, Conversion, Consolidation or
Succession to Business................................................. 62
Section 613. Preferential Collection of Claims
Against Company........................................................ 62
Section 614. Appointment of Authenticating Agent..................................... 63
ARTICLE SEVEN
-------------
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and
Addresses of Holders................................................... 65
Section 702. Preservation of Information;
Communications to Holders.............................................. 66
Section 703. Reports by Trustee...................................................... 66
Section 704. Reports by Company...................................................... 67
ARTICLE EIGHT
-------------
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 801. Company and Subsidiaries May
Consolidate, Etc., Only on
Certain Terms........................................................... 67
Section 802. Successor Substituted................................................... 68
ARTICLE NINE
------------
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures Without Consent
of Holders............................................................. 68
Section 902. Supplemental Indentures with Consent of
Holders................................................................ 70
Section 903. Execution of Supplemental Indentures.................................... 72
Section 904. Effect of Supplemental Indentures....................................... 72
Section 905. Conformity with Trust Indenture Act..................................... 72
Section 906. Reference in Securities to Supplemental
Indentures............................................................. 72
</TABLE>
-iv-
<PAGE> 8
-v-
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE TEN
-----------
COVENANTS
Section 1001. Payment of Principal, Premium and
Interest............................................................... 73
Section 1002. Maintenance of Office or Agency......................................... 73
Section 1003. Money for Securities Payments to Be
Held in Trust.......................................................... 74
Section 1004. Statement by Officers as to Default..................................... 75
Section 1005. Existence............................................................... 76
Section 1006. Maintenance of Properties............................................... 76
Section 1007. Payment of Taxes and Other Claims....................................... 76
Section 1008. Waiver of Certain Covenants............................................... 77
ARTICLE ELEVEN
--------------
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article................................................ 77
Section 1102. Election to Redeem; Notice to Trustee................................... 77
Section 1103. Selection by Trustee of Securities to
Be Redeemed............................................................ 78
Section 1104. Notice of Redemption.................................................... 79
Section 1105. Deposit of Redemption Price............................................. 79
Section 1106. Securities Payable on Redemption Date................................... 80
Section 1107. Securities Redeemed in Part............................................. 80
ARTICLE TWELVE
--------------
SINKING FUNDS
Section 1201. Applicability of Article................................................ 81
Section 1202. Satisfaction of Sinking Fund Payments
with Securities........................................................ 81
Section 1203. Redemption of Securities for Sinking
Fund................................................................... 82
TESTIMONIUM........................................................................................ 83
SIGNATURES AND SEALS............................................................................... 83
ACKNOWLEDGMENTS.................................................................................... 84
</TABLE>
INDENTURE, dated as of ........, 19.., between The Kroger Co., a
corporation duly organized and existing under the laws of the State of Ohio
(herein called the "Company"), having its principal office at 1014 Vine Street,
Cincinnati, Ohio 45202, and .............................., a
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<PAGE> 9
........................... duly organized and existing under the laws of
........, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section
101. DEFINITIONS.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
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<PAGE> 10
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall mean
such accounting principles as are generally accepted and applied by the
Company on March 22, 1997; and
(4) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Administrative Agents" means Citibank, N.A. and The Chase
Manhattan Bank, as Administrative Agents under the Bank Agreement, and, upon
notice to the Company and the Trustee, any successors thereto under the Bank
Agreement.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Bank Agreement" means the 364-Day Credit Agreement and the
Five-Year Credit Agreement, both dated as of May 28, 1997, among the Company,
the Lenders named therein, the Administrative Agents, and the Syndication Agent
and Documentation Agent named therein, as such Agreement (including, without
limitation, any "Loan Documents" (as defined in the Bank Agreement)) has been or
may be amended, amended and restated, supplemented or otherwise modified from
time to time, and includes any
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<PAGE> 11
agreement extending the maturity of, refinancing or otherwise restructuring
(including, but not limited to, the inclusion of additional borrowers thereunder
that are Subsidiaries of the Company) all or any portion of the Obligations
under such Agreement or any successor agreement.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day", when used with respect to any Place of
Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is not
a day on which banking institutions in that Place of Payment are authorized or
obligated by law or executive order to close.
"Capital Stock" means any and all shares, interests,
participations, warrants, rights or other equivalents (however designated) of
corporate stock.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, or, if at any time after the execution of this instrument such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.
"Corporate Trust Office" means the principal office of the
Trustee in .................................
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.............................. at which at any particular time its corporate
trust business shall be administered.
"corporation" means a corporation, association, company,
joint-stock company or business trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to the Securities of any
series issuable in whole or in part in the form of one or more Global
Securities, the clearing agency registered under the Exchange Act specified for
that purpose as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 as it
may be amended and any successor act thereto.
"Global Security" means a Security bearing the legend
specified in Section 204 evidencing all or part of a series of Securities,
authenticated and delivered to the Depositary for such series or its nominee,
and registered in the name of such Depositary or nominee.
"Holder" means a Person in whose name a Security is registered
in the Security Register.
"Indebtedness" means (without duplication), with respect to
any Person, (i) every obligation of such Person for money borrowed, (ii) every
obligation of such Person evidenced by bonds, debentures, notes or other similar
instruments, (iii) every obligation of such Person issued or assumed as the
deferred purchase price of property, every conditional sale obligation and every
obligation under any title retention agreement, in each case if on terms
permitting any portion of the purchase price to be paid beyond one year from the
date of purchase (but excluding trade accounts payable arising in the ordinary
course of business which are not overdue by more than 90 days or which are being
contested in good faith), (iv) every obligation of such Person issued or
contracted for as payment in consideration of the purchase by such Person or an
Affiliate of such Person of the Capital Stock or substantially all of the assets
of another Person or a merger or consolidation to which such Person or an
Affiliate of such Person was a party, (v) every obligation of the type referred
to in clauses (i) through (iv) of other Persons and all dividends
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<PAGE> 13
of other Persons for the payment of which, in either case, such Person is
responsible or liable, directly or indirectly, as obligor, guarantor or
otherwise, and (vi) every obligation of the type referred to in clauses (i)
through (v) of other Persons secured by any Lien on any property or asset of
such Person (whether or not such obligation is assumed by such Person), the
amount of such obligation being deemed to be the lesser of the value of such
property or assets or the amount of the obligation so secured. "Indebtedness,"
however, does not include any obligation of any Person under any interest rate
swap, cap, collar or similar arrangement.
"Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument, and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an instalment of interest on such
Security.
"Lien" means, with respect to any property or asset, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement (other than any easement
not materially impairing usefulness or marketability), encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or asset (including,
without limitation, any conditional sale or other title retention agreement
having substantially the same economic effect as any of the foregoing).
"Maturity", when used with respect to any Security, means the
date on which the principal of such Security or an instalment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity
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<PAGE> 14
or by declaration of acceleration, call for redemption or otherwise.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman of the Board, the President or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee. One of the
officers signing an Officers' Certificate given pursuant to Section 1004 shall
be the principal executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of the Company or counsel for the Company, and who shall be
acceptable to the Trustee.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502.
"Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, EXCEPT:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; PROVIDED that, if
such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) Securities which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been pre-
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<PAGE> 15
sented to the Trustee proof satisfactory to it that such Securities are
held by a bona fide purchaser in whose hands such Securities are valid
obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (i) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon acceleration of the Maturity
thereof pursuant to Section 502, (ii) the principal amount of a Security
denominated in one or more foreign currencies or currency units shall be the
U.S. dollar equivalent, determined in the manner provided as contemplated by
Section 301 on the date of original issuance of such Security, of the principal
amount (or, in the case of an Original Issue Discount Security, the U.S. dollar
equivalent on the date of original issuance of such Security of the amount
determined as provided in (i) above) of such Security, and (iii) Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities which the Trustee knows to be so
owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of or any premium or interest on any Securities on behalf of
the Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment", when used with respect to the Securities
of any series, means the place or places where the principal of and any premium
and interest on the
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<PAGE> 16
Securities of that series are payable as specified as contemplated by Section
301.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 301.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or
any instalment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long
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<PAGE> 17
as no senior class of stock has such voting power by reason of any contingency.
"Trustee" initially means the Person named as the "Trustee" in
the first paragraph of this instrument until a successor Trustee shall have
become such pursuant to the applicable provisions of this Indenture, and
thereafter "Trustee" shall mean or include each Person who is then a Trustee
hereunder, and if at any time there is more than one such Person, "Trustee" as
used with respect to the Securities of any series shall mean the Trustee with
respect to Securities of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; PROVIDED,
HOWEVER, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
"Wholly-owned Subsidiary" means a Subsidiary, all of the
outstanding Capital Stock of which (other than directors' qualifying shares)
shall at the time be owned by the Company or by one or more Wholly-owned
Subsidiaries or by the Company and one or more Wholly-owned Subsidiaries.
Section 102. COMPLIANCE CERTIFICATES AND OPINIONS.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an Officers' Certificate, if to be given by an officer of the Company,
or an Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include
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<PAGE> 18
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
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<PAGE> 19
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Section 104. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
Without limiting the generality of the foregoing, a Holder,
including a Depositary that is a Holder of a Global Security, may make, give or
take, by a proxy, or proxies, duly appointed in writing, any request, demand,
authorization, direction, notice, consent, waiver or other action provided in
this Indenture to be made, given or taken by Holders, and a Depositary that is a
Holder of a Global Security may provide its proxy or proxies to the beneficial
owners of interests in any such Global Security.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be
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<PAGE> 20
proved in any other manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the
Trust Indenture Act, and to the extent required by this Indenture shall, fix any
day as the record date for the purpose of determining the Holders of Securities
of any series entitled to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action, or to vote on any action,
authorized or permitted to be given or taken by Holders of Securities of such
series; PROVIDED, HOWEVER, that in no event may the Company set a record date
for the purpose of determining the Holders of the Securities entitled to give or
take any request, demand, authorization, direction, notice, consent, waiver or
other action pursuant to Section 501, 502 (other than the second paragraph
thereof), 507 or 512. Except as otherwise provided herein, if not set by the
Company prior to the first solicitation of a Holder of Securities of such series
made by any Person in respect of any such action, or, in the case of any such
vote, prior to such vote, the record date for any such action or vote shall be
the 30th day (or, if later, the date of the most recent list of Holders required
to be provided pursuant to Section 701) prior to such first solicitation or
vote, as the case may be. With regard to any record date for action to be given
or taken or voted upon by the Holders of one or more series of Securities, only
the Holders of Securities of such series on such date (or their duly designated
proxies) shall be entitled to give or take, or vote on, the relevant action.
(d) The ownership of Securities shall be proved by the
Security Register.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
Section 105. NOTICES, ETC., TO TRUSTEE AND COMPANY.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
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<PAGE> 21
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office,
Attention: ................., or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its principal
office specified in the first paragraph of this instrument or at any
other address previously furnished in writing to the Trustee by the
Company.
Section 106. NOTICE TO HOLDERS; WAIVER.
Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
Section 107. CONFLICT WITH TRUST INDENTURE ACT.
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<PAGE> 22
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded.
Section 108. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
Section 109. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
Section 110. SEPARABILITY CLAUSE.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 111. BENEFITS OF INDENTURE.
Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
Section 112. GOVERNING LAW.
This Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York.
Section 113. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Redemption Date
or Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities (other than a provision of the Securities of any
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<PAGE> 23
series which specifically states that such provision shall apply in lieu of this
Section)) payment of interest or principal (and premium, if any) need not be
made at such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, PROVIDED that no interest shall accrue for the period from and after
such Interest Payment Date, Redemption Date or Stated Maturity, as the case may
be.
ARTICLE TWO
Security Forms
Section 201. FORMS GENERALLY.
The Securities of each series shall be in substantially the
form set forth in this Article, or in such other form as shall be established by
or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Section 202. FORM OF FACE OF SECURITY.
[INSERT ANY LEGEND REQUIRED BY THE INTERNAL REVENUE CODE AND
THE REGULATIONS THEREUNDER.]
THE KROGER CO.
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<PAGE> 24
............................................
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing
under the laws of the State of Ohio (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to ....................................,
or registered assigns, the principal sum of .................. ................
Dollars on ...................... ........................... [IF THE SECURITY
IS TO BEAR INTEREST PRIOR TO MATURITY, INSERT -- , and to pay interest thereon
from ............. or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per annum,
until the principal hereof is paid or made available for payment [IF APPLICABLE,
INSERT -- , and at the rate of ....% per annum on any overdue principal and
premium and on any overdue instalment of interest]. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the ....... or
....... (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture].
[IF THE SECURITY IS NOT TO BEAR INTEREST PRIOR TO MATURITY,
INSERT -- The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated
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<PAGE> 25
Maturity and in such case the overdue principal of this Security shall bear
interest at the rate of ....% per annum, which shall accrue from the date of
such default in payment to the date payment of such principal has been made or
duly provided for. Interest on any overdue principal shall be payable on demand.
Any such interest on any overdue principal that is not so paid on demand shall
bear interest at the rate of ......% per annum, which shall accrue from the date
of such demand for payment to the date payment of such interest has been made or
duly provided for, and such interest shall also be payable on demand.]
Payment of the principal of (and premium, if any) and [IF
APPLICABLE, INSERT -- any such] interest on this Security will be made at the
office or agency of the Company maintained for that purpose in ............, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts [IF APPLICABLE, INSERT
- -- ; PROVIDED, HOWEVER, that at the option of the Company payment of interest
may be made by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register].
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By.....................
Attest:
...........................
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<PAGE> 26
Section 203. FORM OF REVERSE OF SECURITY.
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of ............., 1998 (herein
called the "Indenture"), between the Company and ..............., as Trustee
(herein called the "Trustee", which term includes any successor trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof[, limited in aggregate principal amount to
$...........].
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, [IF
APPLICABLE, INSERT -- (1) on ........... in any year commencing with the year
...... and ending with the year ...... through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount, and
(2)] at any time [on or after .........., 19..], as a whole or in part, at the
election of the Company, at the following Redemption Prices (expressed as
percentages of the principal amount): If redeemed [on or before ...............,
__%, and if redeemed] during the 12-month period beginning ............. of the
years indicated,
Year Redemption Year Redemption
- ---- Price ---- Price
----- -----
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<PAGE> 27
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [IF APPLICABLE, INSERT -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[IF APPLICABLE, INSERT -- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, (1) on
............ in any year commencing with the year .... and ending with the year
.... through operation of the sinking fund for this series at the Redemption
Prices for redemption through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below, and (2) at
any time [on or after ............], as a whole or in part, at the election of
the Company, at the Redemption Prices for redemption otherwise than through
operation of the sinking fund (expressed as percentages of the principal amount)
set forth in the table below: If redeemed during the 12-month period beginning
............ of the years indicated,
Year Redemption Price
- ---- For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Sinking Fund of the Sinking Fund
------------ -------------------
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record
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<PAGE> 28
at the close of business on the relevant Record Dates referred to on the face
hereof, all as provided in the Indenture.]
[Notwithstanding the foregoing, the Company may not, prior to
............., redeem any Securities of this series as contemplated by [Clause
(2) of] the preceding paragraph as a part of, or in anticipation of, any
refunding operation by the application, directly or indirectly, of moneys
borrowed having an interest cost to the Company (calculated in accordance with
generally accepted financial practice) of less than .....% per annum.]
[The sinking fund for this series provides for the redemption
on ............ in each year beginning with the year ....... and ending with the
year ...... of [not less than $.......... ("mandatory sinking fund") and not
more than] $......... aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made [in the inverse
order in which they become due].]
[IF THE SECURITY IS SUBJECT TO REDEMPTION, INSERT -- In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.]
[IF THE SECURITY IS NOT AN ORIGINAL ISSUE DISCOUNT SECURITY,
INSERT -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.]
[IF THE SECURITY IS AN ORIGINAL ISSUE DISCOUNT SECURITY,
INSERT -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, an amount of principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture. Such amount shall be equal to -- INSERT FORMULA FOR DETERMINING
THE AMOUNT. Upon payment (i) of the amount of principal so declared due and
payable and (ii) of interest on any overdue principal and overdue
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<PAGE> 29
interest, all of the Company's obligations in respect of the payment of the
principal of and interest, if any, on the Securities of this series shall
terminate.]
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of 50% in principal amount of the
Securities at the time Outstanding of each series to be affected. The Indenture
also contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in principal amount of the Outstanding Securities a direction inconsistent with
such request and shall have failed to institute such proceeding within 60 days;
PROVIDED, HOWEVER, that such limitations do not apply to a suit instituted by
the Holder hereof for the enforcement of payment of the principal of (and
premium, if any) or any interest on this Security on or after the respective due
dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
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<PAGE> 30
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of $....... and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Section 204. FORM OF LEGEND FOR GLOBAL SECURITIES.
Any Global Security authenticated and delivered hereunder
shall bear a legend in substantially the following form:
"This Security is a Global Security within the meaning of the
Indenture hereinafter referred
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<PAGE> 31
to and is registered in the name of a Depositary or a nominee of a
Depositary. This Security is not exchangeable for Securities registered
in the name of a Person other than the Depositary or its nominee except
in the limited circumstances described in the Indenture, and no
transfer of this Security (other than a transfer of this Security as a
whole by the Depositary to a nominee of the Depositary or by a nominee
of the Depositary to the Depositary or another nominee of the
Depositary) may be registered except in the limited circumstances
described in the Indenture."
Section 205. FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION.
The Trustee's certificates of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
..............................
As Trustee
By............................
Authorized Officer
ARTICLE THREE
The Securities
Section 301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution and, subject to
Section 303, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securi-
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<PAGE> 32
ties of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 304, 305, 306, 906 or 1107
and except for any Securities which, pursuant to Section 303, are
deemed never to have been authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the
series shall be payable, if other than the Person in whose name that
Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest;
(4) the date or dates on which the principal of the
Securities of the series is payable;
(5) the rate or rates at which the Securities of the series
shall bear interest, if any, the date or dates from which such interest
shall accrue, the Interest Payment Dates on which any such interest
shall be payable and the Regular Record Date for any interest payable
on any Interest Payment Date;
(6) the place or places where the principal of and any
premium and interest on Securities of the series shall be payable;
(7) the period or periods within which, the price or prices
at which and the terms and conditions upon which Securities of the
series may be redeemed, in whole or in part, at the option of the
Company;
(8) the obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a
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<PAGE> 33
Holder thereof and the period or periods within which, the price or
prices at which and the terms and conditions upon which Securities of
the series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the series
shall be issuable;
(10) the currency, currencies or currency units in which
payment of the principal of and any premium and interest on any
Securities of the series shall be payable if other than the currency of
the United States of America and the manner of determining the
equivalent thereof in the currency of the United States of America for
purposes of the definition of "Outstanding" in Section 101;
(11) if the amount of payments of principal of or any premium
or interest on any Securities of the series may be determined with
reference to an index, the manner in which such amounts shall be
determined;
(12) if the principal of or any premium or interest on any
Securities of the series is to be payable, at the election of the
Company or a Holder thereof, in one or more currencies or currency
units other than that or those in which the Securities are stated to be
payable, the currency, currencies or currency units in which payment of
the principal of and any premium and interest on Securities of such
series as to which such election is made shall be payable, and the
periods within which and the terms and conditions upon which such
election is to be made;
(13) if other than the principal amount thereof, the portion
of the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 502;
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<PAGE> 34
(14) whether the Securities of the Series shall be issued in
whole or in part in the form of one or more Global Securities and, in
such case, the Depositary or Depositaries with respect to such Global
Security or Securities and the circumstances under which any such
Global Security may be registered for transfer or exchange, or
authenticated and delivered, in the name of a Person other than such
Depositary or its nominee, if other than as set forth in Section 305;
(15) any other event or events of default applicable with
respect to the Securities of the series in addition to those provided
in Section 501(1) through (7);
(16) any other covenant or warranty included for the benefit
of Securities of the series in addition to (and not inconsistent with)
those included in this Indenture for the benefit of Securities of all
series, or any other covenant or warranty included for the benefit of
Securities of the series in lieu of any covenant or warranty included
in this Indenture for the benefit of Securities of all series, or any
provision that any covenant or warranty included in this Indenture for
the benefit of Securities of all series shall not be for the benefit of
Securities of such series, or any combination of such covenants,
warranties or provisions;
(17) the terms pursuant to which (i) the Company may
consolidate with or merge into any other Person, (ii) any Subsidiary of
the Company may consolidate with or merge into another Person in a
transaction in which such Subsidiary remains a Subsidiary, (iii) any
other Person may consolidate with or merge into any Subsidiary in which
such Subsidiary remains a Subsidiary, or (iv) any other Person may,
directly or indirectly, sell, assign, convey, transfer or lease its
properties substantially as an entirety to the Company; and
(18) any other terms of the series (which terms shall not be
inconsistent with
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<PAGE> 35
the provisions of this Indenture, except as permitted by Section
901(5)).
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be
provided in or pursuant to the Board Resolution referred to above and
(subject to Section 303) set forth, or determined in the manner
provided, in the Officers' Certificate referred to above or in any such
indenture supplemental hereto.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an appropriate record
of such action shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Officers' Certificate setting forth the terms of
the series.
Section 302. DENOMINATIONS.
The Securities of each series shall be issuable in registered
form without coupons in such denominations as shall be specified as contemplated
by Section 301. In the absence of any such provisions with respect to the
Securities of any series, the Securities of such series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
Section 303. EXECUTION, AUTHENTICATION, DELIVERY AND
DATING.
The Securities shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its President or one
of its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
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<PAGE> 36
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any Series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities. If the form or terms of the Securities of the series have been
established in or pursuant to one or more Board Resolutions as permitted by
Sections 201 and 301, in authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to Section 601) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(a) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 201, that
such form has been established in conformity with the provisions
of this Indenture;
(b) if the terms of such Securities have been established by
or pursuant to Board Resolution as permitted by Section 301, that
such terms have been established in conformity with the
provisions of this Indenture; and
(c) that such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and subject
to any conditions specified in such Opinion
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<PAGE> 37
of Counsel, will constitute valid and legally binding obligations
of the Company enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 301 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon original issuance
of the first Security of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature, and such certificate upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder. Notwithstanding
the foregoing, if any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancellation as provided in Section
309, for all purposes of this Indenture such Security shall be deemed never to
have been authenticated and delivered
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<PAGE> 38
hereunder and shall never be entitled to the benefits of this Indenture.
Section 304. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities of any
series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary Securities
of such series at the office or agency of the Company in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any series the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and tenor. Until so exchanged the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
Section 305. REGISTRATION, REGISTRATION OF
TRANSFER AND EXCHANGE.
The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office and in
any other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfers of Securities. The Trustee
is hereby
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<PAGE> 39
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of
any series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount and tenor.
At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Securities to be exchanged at such office or agency. Whenever any
Securities are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
The Company shall not be required (i) to issue, register the
transfer of or exchange Securities of any series during a period beginning at
the opening
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<PAGE> 40
of business 15 days before the day of the mailing of a notice of redemption of
Securities of that series selected for redemption under Section 1103 and ending
at the close of business on the day of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
Notwithstanding the foregoing, no Global Security shall be
registered for transfer or exchange, or authenticated and delivered, whether
pursuant to this Section, Section 304, 306, 906 or 1107 or otherwise, in the
name of a Person other than the Depositary for such Global Security or its
nominee until (i) the Depositary with respect to a Global Security notifies the
Company that it is unwilling or unable to continue as Depositary for such Global
Security or the Depositary ceases to be a clearing agency registered under the
Exchange Act, (ii) the Company executes and delivers to the Trustee a Company
Order that such Global Security shall be so transferable and exchangeable or
(iii) there shall have occurred and be continuing an Event of Default, or any
event which after notice or lapse of time, or both, would constitute an Event of
Default, with respect to the Securities of such series. Upon the occurrence in
respect of any Global Security of any series of any one or more of the
conditions specified in clauses (i), (ii) or (iii) of the preceding sentence or
such other conditions as may be specified as contemplated by Section 301 for
such series, such Global Security may be registered for transfer or exchange for
Securities registered in the names of, or authenticated and delivered to, such
Persons as the Depositary with respect to such series shall direct.
Except as provided in the preceding paragraph, any Security
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Security, whether pursuant to this Section,
Section 304, 306, 906 or 1107 or otherwise, shall also be a Global Security and
bear the legend specified in Section 204.
Section 306. MUTILATED, DESTROYED, LOST AND STOLEN
SECURITIES.
If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee
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<PAGE> 41
shall authenticate and deliver in exchange therefor a new Security of the same
series and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this
Section in lieu of any mutilated, destroyed, lost or stolen Security shall
constitute an original additional contractual obligation of the Company, whether
or not the mutilated, destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities of that
series duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
Section 307. PAYMENT OF INTEREST; INTEREST RIGHTS
PRESERVED.
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Except as otherwise provided as contemplated by Section 301
with respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest.
Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such
series (or their respective Predecessor Securities) are
registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid
on each Security of such series and the date of the proposed
payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior
to the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this Clause provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 days and not
less than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at
the expense of the Company, shall cause notice of the proposed
payment of such
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Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder of Securities
of such series at his address as it appears in the Security
Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor
Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to
the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which such Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this
Clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to
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interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Section 308. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and any
premium and (subject to Section 307) any interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 309. CANCELLATION.
All Securities surrendered for payment, redemption,
registration of transfer or exchange or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be delivered
to the Trustee and shall be promptly cancelled by it. The Company may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly cancelled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Securities held by the Trustee shall be disposed of as
directed by a Company Order.
Section 310. COMPUTATION OF INTEREST.
Except as otherwise specified as contemplated by Section 301
for Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
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Satisfaction and Discharge
Section 401. SATISFACTION AND DISCHARGE OF
INDENTURE.
This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered
(other than (i) Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in
Section 306 and (ii) Securities for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 1003) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the
expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or
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caused to be deposited with the Trustee as trust funds in trust
for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered
to the Trustee for cancellation, for principal and any premium
and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2 the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and
(3 the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied
with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 607, the
obligations of the Trustee to any Authenticating Agent under Section 614 and, if
money shall have been deposited with the Trustee pursuant to subclause (B) of
Clause (1) of this Section, the obligations of the Trustee under Section 402 and
the last paragraph of Section 1003 shall survive.
Section 402. APPLICATION OF TRUST MONEY.
Subject to provisions of the last paragraph of Section 1003,
all money deposited with the Trustee pursuant to Section 401 shall be held in
trust and applied by it, in accordance with the provisions of the Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium and
interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
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Remedies
Section 501. EVENTS OF DEFAULT.
"Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1 default in the payment of any interest upon any Security of that
series when it becomes due and payable, and continuance of such default for a
period of 30 days; or
(2 default in the payment of the principal of (or premium, if any,
on) any Security of that series at its Maturity; or
(3 default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4 default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has expressly been included in this Indenture
solely for the benefit of series of Securities other than that series), and
continuance of such default or breach for a period of 60 days after there has
been given, by registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least 25% in principal amount
of the Outstanding Securities of that series a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" hereunder; or
(5 a default under any Indebtedness by the Company (including a
default with respect
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to Securities of any series other than that series) or under any bond,
debenture, note, mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness by the
Company (including this Indenture) with a principal amount then outstanding in
excess of $50,000,000, whether such Indebtedness now exists or shall hereafter
be created, which default shall constitute a failure to pay the principal of
such Indebtedness at final maturity or shall have resulted in such Indebtedness
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable, without such Indebtedness having been
discharged, or such acceleration having been rescinded or annulled, within a
period of 10 days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in principal amount of the Outstanding Securities of
that series a written notice specifying such default and requiring the Company
to cause such Indebtedness to be discharged or cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of Default"
hereunder; or
(6 the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or
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order for relief or any such other decree or order unstayed and in effect for a
period of 90 consecutive days; or
(7 the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization or
other similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a decree or order
for relief in respect of the Company in an involuntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or
the consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial part
of its property, or the making by it of a general assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action; or
(8 any other Event of Default provided with respect to
Securities of that series.
Section 502. ACCELERATION OF MATURITY; RESCISSION
AND ANNULMENT.
If an Event of Default with respect to Securities of any
series at the time Outstanding occurs and is continuing, then in every such case
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
any of the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount of such Securities as may be specified in
the terms thereof) of all
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of the Securities of that series to be due and payable immediately, by
a notice in writing to the Company and the Administrative Agents (and
to the Trustee if given by Holders), and upon any such declaration
such principal amount (or specified amount) shall become due and
payable five Business Days after the receipt by the Company and the
Administrative Agents of such written notice, provided such Event of
Default is then continuing; PROVIDED, HOWEVER, that the preceding
proviso shall not restrict the availability of other rights or
remedies that the Trustee or the Holders may have.
At any time after such a declaration of acceleration with respect
to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee
as hereinafter in this Article provided, the Holders of a majority in
principal amount of the Outstanding Securities of that series, by
written notice to the Company and the Trustee, may rescind and annul
such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of that series
which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) interest upon overdue interest at the rate or rates prescribed therefor in
such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and
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advances of the Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities
of that series which have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section
513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. COLLECTION OF INDEBTEDNESS AND SUITS
FOR ENFORCEMENT BY TRUSTEE.
The Company covenants that if
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such
default continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and interest on any
overdue principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of
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Securities of such series by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
Section 504. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of any judicial proceeding relative to the Company (or
any other obligor upon the Securities), its property or its creditors, the
Trustee shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding;
PROVIDED, HOWEVER, the Trustees may vote on behalf of the Holders for the
election of a trustee in bankruptcy or similar official and may be a member of a
creditors or other similar committee.
Section 505. TRUSTEE MAY ENFORCE CLAIMS WITHOUT
POSSESSION OF SECURITIES.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any
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proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which such judgment has been recovered.
Section 506. APPLICATION OF MONEY COLLECTED.
Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
or any premium or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for
principal and any premium and interest, respectively.
Section 507. LIMITATION ON SUITS.
No Holder of any Security of any series shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the
Securities of that series;
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(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series shall have made written
request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities
to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the Outstanding
Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
Section 508. UNCONDITIONAL RIGHT OF HOLDERS TO
RECEIVE PRINCIPAL, PREMIUM AND INTEREST.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to Section 307) any interest on such Security on the Stated Maturity or
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder.
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Section 509. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 510. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 511. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any
Securities to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.
Section 512. CONTROL BY HOLDERS.
The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of
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conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Securities of
such series, PROVIDED that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 513. WAIVER OF PAST DEFAULTS.
The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default
(1) in the payment of the principal of or any premium or
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of
the Holder of each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 514. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, a court may require any party litigant in
such suit to file an undertaking to pay the costs of such suit, and may assess
costs against any
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such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; PROVIDED that neither this Section nor the Trust Indenture Act
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Company.
Section 515. WAIVER OF USURY, STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any usury, stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.
ARTICLE SIX
The Trustee
Section 601. CERTAIN DUTIES AND RESPONSIBILITIES.
The duties and responsibilities of the Trustee shall be as
provided by the Trust Indenture Act. Notwithstanding the foregoing, no provision
of this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Indenture
relating to the conduct or affecting the liability of or affording protection to
the Trustee shall be subject to the provisions of this Section.
Section 602. NOTICE OF DEFAULTS.
If a default occurs hereunder with respect to Securities of
any series, the Trustee shall give the
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Holders of Securities of such series notice of such default as and to the extent
provided by the Trust Indenture Act; PROVIDED, HOWEVER, that in the case of any
default of the character specified in Section 501(4) with respect to Securities
of such series, no such notice to Holders shall be given until at least 30 days
after the occurrence thereof. For the purpose of this Section, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an Event of Default with respect to Securities of such series.
Section 603. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 601:
(a the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken,
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suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which
might be incurred by it in compliance with such request or direction;
(f the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine
to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or
by agent or attorney; and
(g the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
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Section 604. NOT RESPONSIBLE FOR RECITALS OR
ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities, except
the Trustee's certificates of authentication, shall be taken as the statements
of the Company, and the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. The Trustee
or any Authenticating Agent shall not be accountable for the use or application
by the Company of Securities or the proceeds thereof.
Section 605. MAY HOLD SECURITIES.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to
Sections 608 and 613, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.
Section 606. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
Section 607. COMPENSATION AND REIMBURSEMENT.
The Company agrees
(1 to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2 except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any
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provision of this Indenture (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3 to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder.
Section 608. DISQUALIFICATION; CONFLICTING
INTERESTS.
If the Trustee has or shall acquire a conflicting
interest within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Indenture.
Section 609. CORPORATE TRUSTEE REQUIRED;
ELIGIBILITY.
There shall at all times be a Trustee hereunder which
shall be a Person that is eligible pursuant to the Trust Indenture Act to act as
such and has a combined capital and surplus of at least $50,000,000 [and its
Corporate Trust Office in ...............................]. If such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Person shall be deemed
to be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
Section 610. SEPARATE TRUSTEE;
RESIGNATION AND REMOVAL;
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APPOINTMENT OF SUCCESSOR.
(a The Company may, but need not, appoint a separate Trustee
for any one or more series of Securities.
(b) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 611.
(c) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.
(d) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company.
(e) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the Company
or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
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then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(f) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, with respect to the Securities of one or more series, the Company, by
a Board Resolution, shall promptly appoint a successor Trustee or Trustees with
respect to the Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall comply with
the applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any Series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance
of such appointment in accordance with the applicable requirements of Section
611, become the successor Trustee with respect to the Securities of such series
and to that extent supersede the successor Trustee appointed by the Company. If
no successor Trustee with respect to the Securities of any Series shall have
been so appointed by the Company or the Holders and accepted appointment in the
manner required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.
(g) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series
to all Holders of Securities of such series in the manner provided in Section
106. Each notice shall include the name of the successor Trustee with respect to
the Securities of such series and the address of its Corporate Trust Office.
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Section 611. ACCEPTANCE OF APPOINTMENT BY
SUCCESSOR.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Securities of that or those series to which the appointment of such successor
Trustee relates, (2) if the retiring Trustee is not retiring with respect to all
Securities, shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
such supplemental indenture the resignation or removal of
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the retiring Trustee shall become effective to the extent provided therein and
each such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates; but, on request of the Company or
any successor Trustee, such retiring Trustee shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder with respect to the Securities of that or those series to
which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraph (a) and (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
Section 612. MERGER, CONVERSION, CONSOLIDATION
OR SUCCESSION TO BUSINESS.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
Section 613. PREFERENTIAL COLLECTION OF CLAIMS
AGAINST COMPANY.
If and when the Trustee shall be or become a creditor of the
Company (or any other obligor upon the
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Securities), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of claims against the Company (or any
such other obligor).
Section 614. APPOINTMENT OF AUTHENTICATING AGENT.
The Trustee may appoint an Authenticating Agent or Agents with
respect to one or more series of Securities which shall be authorized to act on
behalf of the Trustee to authenticate Securities of such series issued upon
original issue and upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 306, and Securities so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper
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or any further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the Security Register. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent
from time to time reasonable compensation for its services under this Section,
and the Trustee shall be entitled to be reimbursed for such payments, subject to
the provisions of Section 607.
If an appointment with respect to one or more series is
made pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
This is one of the Securities of the series designated
therein referred to in the within-mentioned Indenture.
........................,
As Trustee
By......................,
As Authenticating Agent
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By......................
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. COMPANY TO FURNISH TRUSTEE
NAMES AND ADDRESSES OF HOLDERS.
The Company will furnish or cause to be furnished to the
Trustee
(a semi-annually, either (i) not later than
_______________ and ___________________ in each year in the case of
Original Issue Discount Securities of any series which by their terms
bear interest only after Maturity, or (ii) not more than 15 days after
each Regular Record Date in the case of Securities of any other series,
a list of each series of Securities, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders of each
such series as of the preceding ______________ or ______________ or
Regular Record Date, as the case may be, and
(b at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished;
EXCLUDING from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
Section 702. PRESERVATION OF INFORMATION;
COMMUNICATIONS TO HOLDERS.
(a) The Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 701 and the
names and addresses of Holders received by the Trustee in its capacity as
Security Registrar. The Trustee may destroy any list furnished to it as provided
in Section 701 upon receipt of a new list so furnished.
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(b) The rights of the Holders to communicate with other
Holders with respect to their rights under this Indenture or under the
Securities, and the corresponding rights and privileges of the Trustee, shall be
as provided by the Trust Indenture Act.
(c Every Holder of Securities, by receiving and holding
the same, agrees with the Company and the Trustee that neither the Company nor
the Trustee nor any agent of either of them shall be held accountable by reason
of any disclosure of information as to names and addresses of Holders made
pursuant to the Trust Indenture Act.
Section 703. REPORTS BY TRUSTEE.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange.
Section 704. REPORTS BY COMPANY.
The Company shall file with the Trustee and the
Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to such Act;
PROVIDED that any such information, documents or reports required to be filed
with the Commission pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 shall be filed with the Trustee within 15 days after the same is so
required to be filed with the Commission.
ARTICLE EIGHT
Consolidation, Merger, Conveyance, Transfer or Lease
Section 801. COMPANY AND SUBSIDIARIES MAY CONSOLIDATE,
ETC., ONLY ON CERTAIN TERMS.
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The Company (a) shall not consolidate with or merge into
any other Person or, directly or indirectly, transfer, convey, sell, lease or
otherwise dispose of all or substantially all of its properties and assets as an
entirety to any Person; (b) shall not permit any Subsidiary to consolidate with
or merge into another Person (other than a Wholly-owned Subsidiary) in a
transaction in which such Subsidiary remains a Subsidiary; (c) shall not permit
(i) any other Person to consolidate with or merge into the Company or (ii) any
other Person (other than a Wholly-owned Subsidiary) to consolidate with or merge
into any Subsidiary in a transaction in which such Subsidiary remains a
Subsidiary; and (d) shall not permit any other Person to, directly or
indirectly, sell, assign, convey, transfer or lease its properties substantially
as an entirety to the Company except as provided pursuant to Section 301(17).
Section 802. SUCCESSOR SUBSTITUTED.
Upon any consolidation of the Company with, or merger of
the Company into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in accordance
with Section 801, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. SUPPLEMENTAL INDENTURES WITHOUT
CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1 to evidence the succession of another
Person to the Company and the assump-
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tion by any such successor of the covenants of the Company herein and
in the Securities; or
(2 to add to the covenants of the Company for the benefit
of the Holders of all or any series of Securities (and if such
covenants are to be for the benefit of less than all series of
Securities, stating that such covenants are expressly being included
solely for the benefit of such series) or to surrender any right or
power herein conferred upon the Company; or
(3 to add any additional Events of Default; or
(4 to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to permit or facilitate
the issuance of Securities in bearer form, registrable or not
registrable as to principal, and with or without interest coupons, or
to permit or facilitate the issuance of Securities in uncertificated
form; or
(5 to add to, change or eliminate any of the provisions
of this Indenture in respect of one or more series of Securities,
PROVIDED that any such addition, change or elimination (i) shall
neither (A) apply to any Security of any series created prior to the
execution of such supplemental indenture and entitled to the benefit of
such provision nor (B) modify the rights of the Holder of any such
Security with respect to such provision or (ii) shall become effective
only when there is no such Security Outstanding; or
(6 to secure the Securities; or
(7 to establish the form or terms of Securities of any
series as permitted by Sections 201 and 301; or
(8 to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the
Securities of one or more series and to add to or
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change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by
more than one Trustee, pursuant to the requirements of Section 611(b);
or
(9) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, PROVIDED that such action
pursuant to this clause (9) shall not adversely affect the interests of
the Holders of Securities of any series in any material respect.
Section 902. SUPPLEMENTAL INDENTURES WITH CONSENT
OF HOLDERS.
With the consent of the Holders of not less than 50% in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; PROVIDED, HOWEVER,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or
any instalment of principal of or interest on, any Security, or reduce
the principal amount thereof or (unless otherwise specified as
contemplated by Section 301) the rate of interest thereon or any
premium payable upon the redemption thereof, or reduce the amount of
the principal of an Original Issue Discount Security that would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502, or change any Place of Payment where, or the
coin or currency in which, any Security or any premium or interest
thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after
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the Stated Maturity thereof (or, in the case of redemption, on or after
the Redemption Date), or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section
513 or Section 1008, except to increase any such percentage or to
provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each
Outstanding Security affected thereby, PROVIDED, HOWEVER, that this
clause shall not be deemed to require the consent of any Holder with
respect to changes in the references to "the Trustee" and concomitant
changes in this Section and Section 1008, or the deletion of this
proviso, in accordance with the requirements of Sections 611(b) and
901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
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Section 903. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts created
by, any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 601) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Section 904. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under
this Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
Section 905. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture Act.
Section 906. REFERENCE IN SECURITIES TO
SUPPLEMENTAL INDENTURES.
Securities of any series authenticated and delivered
after the execution of any supplemental indenture pursuant to this Article may,
and shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities of any series so modified as to
conform, in the opinion of the Trustee and the Company, to any such supplemental
indenture may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities of such series.
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ARTICLE TEN
Covenants
Section 1001.PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The Company covenants and agrees for the benefit of each
series of Securities that it will duly and punctually pay the principal of and
any premium and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.
Section 1002. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in each Place of Payment for
any series of Securities an office or agency where Securities of that series may
be presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or
more other offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; PROVIDED, HOWEVER, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in each Place of Payment for Securities of any series for
such purposes. The Company will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
Section 1003. MONEY FOR SECURITIES PAYMENTS TO
BE HELD IN TRUST.
If the Company shall at any time act as its own Paying
Agent with respect to any series of Securities, it
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will, on or before each due date of the principal of or any premium or interest
on any of the Securities of that series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
and any premium and interest so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents
for any series of Securities, it will, prior to each due date of the principal
of or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.
The Company will cause each Paying Agent for any series
of Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (i) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and
(ii) during the continuance of any default by the Company (or any other obligor
upon the Securities of that series) in the making of any payment in respect of
the Securities of that series, and upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent,
or then held by the Company, in trust for the payment of the principal of or any
premium or interest on any Security of any series and remaining unclaimed for
two years after such principal, premium or interest has become due and payable
shall be paid to the Company on Company
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Request, or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; PROVIDED, HOWEVER,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in a
newspaper published in the English language, customarily published on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
Section 1004. STATEMENT BY OFFICERS AS TO DEFAULT.
The Company will deliver to the Trustee, within 120 days
after the end of each fiscal year of the Company ending after the date hereof,
an Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions of this Indenture (without regard to
any period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section 1005 EXISTENCE.
Subject to Article Eight, the Company will do or cause to
be done all things necessary to preserve and keep in full force and effect its
existence, rights (charter and statutory) and franchises; PROVIDED, HOWEVER,
that the Company shall not be required to preserve any such right or franchise
if the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company.
Section 1006. MAINTENANCE OF PROPERTIES.
The Company will cause all properties used or useful in
the conduct of its business or the business of any material Subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary
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repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
PROVIDED, HOWEVER, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary.
Section 1007. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes, assessments
and governmental charges levied or imposed upon the Company or any material
Subsidiary or upon the income, profits or property of the Company or any
material Subsidiary, and (2) all lawful claims for labor, materials and supplies
which, if unpaid, might by law become a lien upon the property of the Company or
any material Subsidiary; PROVIDED, HOWEVER, that the Company shall not be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings, if a reserve or other
appropriate provision shall have been made therefor in accordance with generally
accepted accounting principles.
Section 1008. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply
with any term, provision or condition set forth in Sections 1006 to 1007,
inclusive, with respect to the Securities of any series if before the time for
such compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
term, provision or condition, but no such waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
ARTICLE ELEVEN
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Redemption of Securities
Section 1101. APPLICABILITY OF ARTICLE.
Securities of any series which are redeemable before
their Stated Maturity shall be redeemable in accordance with their terms and
(except as otherwise specified as contemplated by Section 301 for Securities of
any series) in accordance with this Article.
Section 1102. ELECTION TO REDEEM; NOTICE TO TRUSTEE.
The election of the Company to redeem any Securities
shall be evidenced by a Board Resolution. In case of any redemption at the
election of the Company of less than all the Securities of any series, the
Company shall, at least 35 days prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee of such Redemption Date, of the principal amount of Securities of
such series to be redeemed and, if applicable, of the tenor of the Securities to
be redeemed. In the case of any redemption of Securities prior to the expiration
of any restriction on such redemption provided in the terms of such Securities
or elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
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Section 1103. SELECTION BY TRUSTEE OF SECURITIES
TO BE REDEEMED.
If less than all the Securities of any series are to be
redeemed (unless all of the Securities of such series and of a specified tenor
are to be redeemed), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series. If less than
all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company and the
Security Registrar in writing of the Securities selected for redemption and, in
the case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
Section 1104. NOTICE OF REDEMPTION.
Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his address
appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
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(3) if less than all the Outstanding Securities of any
series are to be redeemed, the identification (and, in the case of
partial redemption of any Securities, the principal amounts) of the
particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security to be redeemed and, if
applicable, that interest thereon will cease to accrue on and after
said date,
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is
the case.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company and shall
be irrevocable.
Section 1105. DEPOSIT OF REDEMPTION PRICE.
Prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest on, all the
Securities which are to be redeemed on that date.
Section 1106. SECURITIES PAYABLE ON REDEMPTION DATE.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price,
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together with accrued interest to the Redemption Date; PROVIDED, HOWEVER, that,
unless otherwise specified as contemplated by Section 301, instalments of
interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so
paid upon surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 1107. SECURITIES REDEEMED IN PART.
Any Security which is to be redeemed only in part shall
be surrendered at a Place of Payment therefor (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of the same series
and of like tenor, of any authorized denomination as requested by such Holder,
in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered.
ARTICLE TWELVE
Sinking Funds
Section 1201. APPLICABILITY OF ARTICLE.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by Section 301 for Securities of such series.
The minimum amount of any sinking fund payment provided
for by the terms of Securities of any series is herein referred to as a
"mandatory sinking fund payment", and any payment in excess of such minimum
amount provided for by the terms of Securities of any series is herein referred
to as an "optional sinking fund payment". If
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provided for by the terms of Securities of any series, the cash amount of any
sinking fund payment may be subject to reduction as provided in Section 1202.
Each sinking fund payment shall be applied to the redemption of Securities of
any series as provided for by the terms of Securities of such series.
Section 1202. SATISFACTION OF SINKING FUND PAYMENTS
WITH SECURITIES.
The Company (1) may deliver Outstanding Securities of a
series (other than any previously called for redemption) and (2) may apply as a
credit Securities of a series which have been redeemed either at the election of
the Company pursuant to the terms of such Securities or through the application
of permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; PROVIDED that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.
Section 1203. REDEMPTION OF SECURITIES FOR SINKING FUND.
Not less than 60 days prior to each sinking fund payment
date for any series of Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting Securities
of that series pursuant to Section 1202 and will also deliver to the Trustee any
Securities to be so delivered. Not less than 45 days before each such sinking
fund payment date the Trustee shall select the Securities to be redeemed upon
such sinking fund payment date in the manner specified in Section 1103 and cause
notice of the redemption thereof to be given in the name of and at the expense
of the Company in the manner provided in Section 1104. Such notice having been
duly given, the redemption of such Securities shall be made upon the terms and
in the manner stated in Sections 1106 and 1107.
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This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument.
-----------------------------
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
THE KROGER CO.
By /s/ Lawrence M. Turner
Attest:
/s/ Paul Heldman
FIRSTAR BANK, NATIONAL ASSOCIATION, as Trustee
By /s/ William Sicking
Attest:
........................
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Exhibit 4.1
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 24th day of June, 1999, before me personally came
Lawrence M. Turner, to me known, who, being by me duly sworn,
did depose and say that he is Vice President and Treasurer of
The Kroger Co., one of the corporations described in and which
executed the foregoing instrument; that he knows the seal of
said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his
name thereto by like authority.
Brenda R. Andes
Notary Public, State of Ohio
My Commission Expires June 20, 2003
........................
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 24th day of June, 1999, before me personally came
William Sicking, to me known, who, being by me duly sworn, did
depose and say that he is Trust Officer of Firstar Bank,
National Association, one of the corporations described in and
which executed the foregoing instrument; that he knows the seal
of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his
name thereto by like authority.
Andre C. Porter, Notary Public
In and for the State of Ohio
My Commission Expires August 29, 2001
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<PAGE> 1
Exhibit 4.2
================================================================================
THE KROGER CO.
AND THE GUARANTORS NAMED HEREIN
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
FIRST SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of June 25, 1999
----------
7.25% SENIOR NOTES DUE 2009
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE ONE
DEFINITIONS
<S> <C>
Section 101. Definitions.................................................................................2
ARTICLE TWO
SECURITY FORMS
Section 201. Form of Securities of this Series..........................................................10
Section 202. Form of Face of Security...................................................................11
Section 203. Form of Reverse of Security................................................................20
Section 204. Form of Guarantee..........................................................................25
Section 205. Global Securities..........................................................................29
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. Transfer and Exchange......................................................................31
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. Title and Terms............................................................................34
ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. Modifications to the Consolidation, Merger, Conveyance, Transfer or Lease
Provisions.................................................................................36
Section 502. Other Modifications........................................................................37
Section 503. Additional Covenants; Defeasance and Covenant Defeasance...................................37
Section 504. Redemption of Securities...................................................................46
ARTICLE SIX
GUARANTEE
Section 601. Guarantee..................................................................................47
Section 602. Waiver of Demand...........................................................................48
Section 603. Guarantee of Payment.......................................................................48
Section 604. No Discharge or Diminishment of Guarantee..................................................48
Section 605. Defenses of Company Waived.................................................................48
Section 606. Continued Effectiveness....................................................................49
</TABLE>
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<TABLE>
<S> <C>
Section 607. Subrogation................................................................................49
Section 608. Information................................................................................49
Section 609. Subordination..............................................................................50
Section 610. Termination................................................................................50
Section 611. Guarantees of other Indebtedness...........................................................51
Section 612. Additional Guarantors......................................................................51
Section 613. Limitation of Guarantor's Liability........................................................51
Section 614. Contribution from Other Guarantors.........................................................51
Section 615. No Obligation to Take Action Against the Company...........................................52
Section 616. Dealing with the Company and Others........................................................52
Section 617. Execution and Delivery of the Guarantee....................................................52
ARTICLE SEVEN
MISCELLANEOUS
Section 701. Miscellaneous..............................................................................53
</TABLE>
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FIRST SUPPLEMENTAL INDENTURE, dated as of June 25, 1999, among
The Kroger Co., a corporation duly organized and existing under the laws of the
State of Ohio (herein called the "Company"), having its principal office at 1014
Vine Street, Cincinnati, Ohio 45202, the guarantors listed on the signature
pages and Schedule I hereto (each, a "Guarantor") and Firstar Bank, National
Association, a banking corporation duly organized and existing under the laws of
the State of Ohio, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of June 25, 1999 (the "Indenture"), providing for
the issuance from time to time of the Company's unsecured debentures, securities
or other evidences of indebtedness (herein and therein called the "Securities"),
to be issued in one or more series as in the Indenture provided.
Section 201 of the Indenture permits the form of the
Securities of any series to be established pursuant to an indenture supplemental
to the Indenture.
Section 301 of the Indenture permits the terms of the
Securities of any series to be established in an indenture supplemental to the
Indenture.
Section 901(7) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture for the purpose of establishing the
form or terms of Securities of any series as permitted by Sections 201 and 301
of the Indenture.
Section 901(9) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture to make any other provisions with
respect to matters or questions arising under the Indenture, provided that such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect.
Each of the Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly authorized the execution and delivery of this First
Supplemental Indenture.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this First Supplemental Indenture to establish the
terms and form of the Securities of a new series and to amend and supplement the
Indenture in certain respects with respect to the Securities of such series.
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All things necessary to make this First Supplemental Indenture
a valid agreement of the Company and the Guarantors, and a valid amendment of
and supplement to the Indenture, have been done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities of the series to be
created hereby, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
(a) For all purposes of this First Supplemental Indenture:
(1) Capitalized terms used herein without definition
shall have the meanings specified in the Indenture;
(2) All references herein to Articles and Sections,
unless otherwise specified, refer to the corresponding
Articles and Sections of this First Supplemental Indenture
and, where so specified, to the Articles and Sections of the
Indenture as supplemented by this First Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto",
"hereunder" and "herewith" refer to this First Supplemental
Indenture.
(b) For all purposes of the Indenture and this First
Supplemental Indenture, with respect to the Securities of the series created
hereby, except as otherwise expressly provided or unless the context otherwise
requires:
"Adjusted Treasury Rate" means, with respect to any
Redemption Date, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed
as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date.
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"Applicable Procedures" means, with respect to any
transfer or transaction involving a Global Security or
beneficial interest therein, the rules and procedures of the
Depositary for such Security, Euroclear and Cedel, in each
case to the extent applicable to such transaction and as in
effect at the time of such transfer or transaction.
"Attributable Debt" means, in connection with a Sale
and Lease-Back Transaction, as of any particular time, the
aggregate of present values (discounted at a rate per annum
equal to the interest rate borne by the Securities of the
series created by this First Supplemental Indenture) of the
obligations of the Company or any Restricted Subsidiary for
net rental payments during the remaining primary term of the
applicable lease, calculated in accordance with generally
accepted accounting principles. The term "net rental payments"
under any lease for any period shall mean the sum of the
rental and other payments required to be paid in such period
by the lessee thereunder, not including, however, any amounts
required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and
repairs, reconstruction, insurance, taxes, assessments, water
rates, operating and labor costs or similar charges required
to be paid by such lessee thereunder or any amounts required
to be paid by such lessee thereunder contingent upon the
amount of sales, maintenance and repairs, reconstruction,
insurance, taxes, assessments, water rates or similar charges.
"Book-Entry Security" means any Global Securities
bearing the legend specified in Section 202 evidencing all or
part of a series of Securities, authenticated and delivered to
the Depositary for such series or its nominee, and registered
in the name of such Depositary or nominee.
"Business Day" means any day other than a Saturday or
Sunday or a day on which banking institutions in New York City
or Cincinnati, Ohio are authorized or obligated by law or
executive order to close.
"Capital Lease" means any lease of property which, in
accordance with generally accepted accounting principles,
should be capitalized on the lessee's balance sheet or for
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which the amount of the asset and liability thereunder as if
so capitalized should be disclosed in a note to such balance
sheet; and "Capitalized Lease Obligation" means the amount of
the liability which should be so capitalized or disclosed.
"Cedel" means CEDEL, S.A. (or any successor
securities clearing agency).
"Commission" means the United States Securities and
Exchange Commission.
"Comparable Treasury Issue" means the United States
Treasury security selected by a Quotation Agent as having a
maturity comparable to the remaining term of the Securities to
be redeemed that would be utilized, at the time of selection
and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Securities.
"Comparable Treasury Price" means, with respect to
any Redemption Date, (i) the average of the Reference Treasury
Dealer Quotations, after excluding the highest and lowest such
Reference Treasury Dealer Quotations for such Redemption Date,
or (ii) if the Trustee obtains fewer than three such Reference
Treasury Dealer Quotations, the average of all such
Quotations.
"Consolidated Net Tangible Assets" means, for the
Company and its Subsidiaries on a consolidated basis
determined in accordance with generally accepted accounting
principles, the aggregate amounts of assets (less depreciation
and valuation reserves and other reserves and items deductible
from gross book value of specific asset accounts under
generally accepted accounting principles) which under
generally accepted accounting principles would be included on
a balance sheet after deducting therefrom (a) all liability
items except deferred income taxes, commercial paper,
short-term bank Indebtedness, Funded Indebtedness, other
long-term liabilities and shareholders' equity and (b) all
goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, which in each
case would be so included on such balance sheet.
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<PAGE> 8
"Credit Facility" means any credit agreement, loan
agreement or credit facility, whether syndicated or not,
involving the extension of credit by banks or other credit
institutions, entered into by the Company or Fred Meyer, Inc.
and outstanding on the date of this First Supplemental
Indenture, and any refinancing or other restructuring of such
agreement or facility.
"Depositary" means, with respect to the Securities
issued in the form of one or more Book-Entry Securities, The
Depository Trust Company ("DTC"), its nominees and successors,
or another Person designated as Depositary by the Company,
which must be a clearing agency registered under the Exchange
Act.
"Euroclear" means the Euroclear Clearance System (or
any successor securities clearing agency).
"Exchange Act" means the Securities Exchange Act of
1934 or any successor statute, and the rules and regulations
promulgated by the Commission thereunder.
"Exchange Offer" means the exchange offer by the
Company of Series B Securities for Series A Securities to be
effected pursuant to the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the
registration statement under the Securities Act contemplated
by the Registration Rights Agreement.
"Funded Indebtedness" means any Indebtedness maturing
by its terms more than one year from the date of the
determination thereof, including (i) any Indebtedness having a
maturity of 12 months or less but by its terms renewable or
extendible at the option of the obligor to a date later than
12 months from the date of the determination thereof and (ii)
rental obligations payable more than 12 months from the date
of determination thereof under Capital Leases (such rental
obligations to be included as Funded Indebtedness at the
amount so capitalized at the date of such computation and to
be included for the purposes of the definition of Consolidated
Net Tangible Assets both as an asset and as Funded
Indebtedness at the amount so capitalized).
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"Global Securities" means the Rule 144A Global
Securities, the Regulation S Global Securities and the Series
B Global Securities to be issued as Book-Entry Securities
issued to the Depositary in accordance with Section 205
hereof.
"Holder" means any holder of any Security pursuant
to, and in accordance with, the terms of the Indenture
"Initial Purchaser" means each of Goldman, Sachs &
Co., Banc One Capital Markets, Inc., Banc of America
Securities LLC, Chase Securities Inc.
and Solomon Smith Barney Inc.
"Initial Securities" has the meaning stated in
Section 401 hereof.
"Non-Restricted Subsidiary" means any Subsidiary that
the Company's Board of Directors has in good faith declared
pursuant to a written resolution not to be of material
importance, either singly or together with all other
Non-Restricted Subsidiaries, to the business of the Company
and its consolidated Subsidiaries taken as a whole.
"Non-U.S. Person" means a Person who is not a "U.S.
Person" as defined in Regulation S under the Securities Act.
"Obligations" has the meaning stated in Section 601
hereof.
"Operating Assets" means all merchandise inventories,
furniture, fixtures and equipment (including all
transportation and warehousing equipment but excluding office
equipment and data processing equipment) owned or leased
pursuant to Capital Leases by the Company or a Restricted
Subsidiary.
"Operating Property" means all real property and
improvements thereon owned or leased pursuant to Capital
Leases by the Company or a Restricted Subsidiary and
constituting, without limitation, any store, warehouse,
service center or distribution center wherever located,
provided that such term shall not include any store,
warehouse, service center or distribution center which the
Company's Board of Directors declares by written resolution
not to be of material
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<PAGE> 10
importance to the business of the Company and its Restricted
Subsidiaries.
"Private Placement Legend" has the meaning stated in
Section 202 hereof.
"Prospectus" means the prospectus included in a
Registration Statement, including any preliminary prospectus,
and any such prospectus as amended or supplemented by any
prospectus supplement, including any such prospectus
supplement with respect to the terms of the offering of any
portion of the Series A Securities covered by a Shelf
Registration Statement, and by all other amendments and
supplements to a prospectus, including post-effective
amendments, and in each case including all material
incorporated by reference therein.
"Quotation Agent" means the Reference Treasury Dealer
appointed by the Company.
"Reference Treasury Dealer" means (i) Goldman, Sachs
& Co. and its successors; provided, however, that if the
foregoing shall cease to be a primary U.S. Government
securities dealer in New York City (a "Primary Treasury
Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer, and (ii) any other Primary Treasury
Dealer selected by the Company.
"Reference Treasury Dealer Quotations" means, with
respect to each Reference Treasury Dealer and any Redemption
Date, the average, as determined by the Company, of the bid
and asked prices for the Comparable Treasury Issue (expressed
in each case as a percentage of its principal amount) quoted
in writing to the Trustee by such Reference Treasury Dealer at
5:00 p.m. on the third Business Day preceding such Redemption
Date.
"Registration Rights Agreement" means the Exchange
and Registration Rights Agreement, dated as of June 25, 1999,
by and among the Company, the Guarantors and the Initial
Purchasers, as such agreement may be amended, modified or
supplemented from time to time.
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<PAGE> 11
"Registration Statement" means any registration
statement of the Company and the Guarantors which covers any
of the Series A Securities (and related guarantees) or Series
B Securities (and related guarantees) pursuant to the
provisions of the Registration Rights Agreement, and all
amendments and supplements to any such Registration Statement,
including post-effective amendments, in each case including
the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Regulation S" means Regulation S promulgated under
the Securities Act or any successor rule or regulation
substantially to the same effect.
"Regulation S Global Security" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Securities sold in reliance
on Regulation S under the Securities Act.
"Restricted Period" has the meaning stated in Section
201 hereof.
"Restricted Subsidiaries" means all Subsidiaries
other than Non-Restricted Subsidiaries.
"Rule 144" means Rule 144 promulgated under the
Securities Act, any successor rule or regulation to
substantially the same effect or any additional rule or
regulation under the Securities Act that permits transfers of
restricted securities without registration such that the
transferee thereof holds securities that are freely tradeable
under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the
Securities Act or any successor rule or regulation to
substantially the same effect.
"Rule 144A Global Securities" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Securities sold in reliance
on Rule 144A under the Securities Act.
"Sale and Lease-Back Transaction" has the meaning
specified in Section 1010.
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<PAGE> 12
"Securities" has the meaning stated in Section 401
hereof.
"Securities Act" means the United States Securities
Act of 1933, as amended.
"Series A Security" has the meaning stated in Section
401 hereof.
"Series B Security" has the meaning stated in Section
401 hereof.
"Series B Global Securities" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Series B Securities
exchanged for Series A Securities pursuant to the Exchange
Offer.
"Shelf Registration Statement" means a "shelf"
registration statement of the Company and the Guarantors
pursuant to the Registration Rights Agreement, which covers
all of the Registrable Securities (as defined in the
Registration Rights Agreement) on an appropriate form under
Rule 415 under the Securities Act, or any similar rule that
may be adopted by the Commission, and all amendments and
supplements to such registration statement, including
post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Subsidiary" means (i) any corporation or other
entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at
the time directly or indirectly owned by the Company and/or
one or more Subsidiaries or (ii) any partnership of which more
than 50% of the partnership interest is owned by the Company
or any Subsidiary.
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<PAGE> 13
ARTICLE TWO
SECURITY FORMS
Section 201. FORM OF SECURITIES OF THIS SERIES.
The Securities of this series shall be in the form set forth
in this Article. Initial Securities offered and sold in reliance on Rule 144A
shall be issued initially in the form of one or more Rule 144A Global
Securities, substantially in the form set forth in Section 202, deposited upon
issuance with the Trustee, as custodian for the Depositary, registered in the
name of the Depositary or its nominee, in each case for credit to an account of
a direct or indirect participant of the Depositary, duly executed by the Company
and authenticated by the Trustee as hereinafter provided. The aggregate
principal amount of the Rule 144A Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Initial Securities offered and sold in reliance on Regulation
S shall be initially issued in the form of one or more Regulation S Global
Securities, substantially in the form set forth in Section 202, deposited upon
issuance with the Trustee, as custodian for the Depositary, registered in the
name of the Depositary or its nominee, in each case for credit by the Depositary
to an account of a direct or indirect participant of the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided; provided, however, that upon such deposit through and including the
40th day after the later of the commencement of the offering of the Securities
and the original issue date of the Securities (such period through and including
such 40th day, the "Restricted Period"), all such Securities shall be credited
to or through accounts maintained at the Depositary by or on behalf of Euroclear
or Cedel unless exchanged for interests in the Rule 144A Global Securities in
accordance with the transfer and certification requirements described below. The
aggregate principal amount of the Regulation S Global Securities may from time
to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
Series B Securities exchanged for Series A Securities shall be
issued initially in the form of one or more Series B Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit to an account of a direct or
indirect participant of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Series B Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
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<PAGE> 14
Section 202. FORM OF FACE OF SECURITY.
(a) The form of the face of any Series A Securities
authenticated and delivered hereunder shall be substantially as follows:
Unless and until (i) an Initial Security is sold under an
effective Registration Statement or (ii) an Initial Security is exchanged for a
Series B Security in connection with an effective Registration Statement, in
each case pursuant to the Registration Rights Agreement, then such Initial
Security which is a Rule 144A Global Security and such Initial Security which is
a Regulation S Global Security shall each bear the respective legend set forth
below (a "Private Placement Legend") on the face thereof:
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<PAGE> 15
[Legend if Rule 144A Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT")
AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT
OF FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN
OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT, (3) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (5) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS
OF THE STATES OF THE UNITED STATES.
[Legend if Regulation S Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT")
AND MAY NOT BE OFFERED, SOLD, OR DELIVERED IN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S.
PERSON, UNLESS THE NOTES ARE REGISTERED UNDER THE SECURITIES
ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT IS AVAILABLE.
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<PAGE> 16
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITORY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE KROGER CO. 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.
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<PAGE> 17
THE KROGER CO.
7.25% Senior Notes due 2009, Series A
CUSIP No. ____________
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing under the
laws of the State of Ohio (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on June 1, 2009, and to pay interest thereon from June 25, 1999 or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing
December 1, 1999, at the rate of interest of 7.25% per annum, subject to
adjustment as described in the next paragraph until the principal hereof is paid
or made available for payment. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the May 15 or November 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
The Holder of this Series A Security is entitled to the benefits of the
Registration Rights Agreement among the Company, the Guarantors and the Initial
Purchasers, dated June 25, 1999, pursuant to which, subject to the terms and
conditions thereof, the Company and the Guarantors are obligated to consummate
the Exchange Offer pursuant to which the Holder of this Security (and the
related Guarantees) shall have the right to exchange this Security (and the
related Guarantees) for 7.25% Senior Notes due 2009, Series B and related
guarantees (herein called the "Series B Securities") in like principal amount as
provided therein. In addition, the Company and the Guarantors have agreed to use
their reasonable efforts to register the Securities for resale under the
Securities Act through a Shelf Registration Statement in the event that the
Exchange Offer is not consummated within 225 calendar days after the original
issue of
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<PAGE> 18
the Securities or under certain other circumstances. The Series A Securities and
the Series B Securities are together (including related Guarantees) referred to
as the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
In the event that (a) the Exchange Offer Registration Statement is not
filed with the Commission on or prior to the 90th calendar day following the
date of original issue of the Series A Securities, (b) the Shelf Registration
Statement is not filed with the Commission on or prior to the date is was
required to be filed in accordance with the terms of the Registration Rights
Agreement, (c) the Exchange Offer Registration Statement is not declared
effective within 180 days following the date of the original issue of the Series
A Securities, (d) a Shelf Registration Statement required to be filed is not
declared effective on or prior to 120 days after it was filed, (e) the Exchange
Offer is not consummated on or prior to the 225th calendar day following the
date of original issue of the Series A Securities, or (f) the Exchange Offer
Registration Statement or the Shelf Registration Statement is filed and declared
effective but shall thereafter either be withdrawn or become subject to an
effective stop order suspending its effectiveness (except as specifically
permitted in the Registration Rights Agreement) without being succeeded
immediately by an additional registration statement which becomes effective
(each such event referred to in clauses (a) through (f) above, a "Registration
Default"), the interest rate borne by the Series A Securities shall be increased
by one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) will increase by an additional
one-quarter of one percent each 90-day period that such additional interest
continues to accrue under any such circumstance, with an aggregate maximum
increase in the interest rate equal to one percent (1%) per annum. Immediately
following the cure of a Registration Default the accrual of additional interest
with respect to that particular Registration Default will cease.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in Cincinnati, Ohio, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; PROVIDED, HOWEVER, that at the option of the Company payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity date of
this Security does not fall on a Business Day, payment of interest or principal
otherwise payable on such day need not be made on such day, but may be made on
the next succeeding Business Day with the same form and effect as if made on
such Interest Payment Date or the maturity date of this Security.
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<PAGE> 19
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By.................................
Attest:
............................................
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<PAGE> 20
(b) The form of the face of any Series B Securities
authenticated and delivered hereunder shall be substantially as follows:
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE KROGER CO. 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.
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<PAGE> 21
THE KROGER CO.
7.25% Senior Notes due 2009, Series B
CUSIP No. ______________
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing under the
laws of the State of Ohio (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on June 1, 2009, and to pay interest thereon from June 25, 1999 or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing
December 1, 1999, at the rate of interest of 7.25% per annum until the principal
hereof is paid or made available for payment, provided that to the extent
interest has not been paid or duly provided for with respect to the Series A
Security exchanged for this Series B Security, interest on this Series B
Security shall accrue from the most recent Interest Payment Date to which
interest on the Series A Security which was exchanged for this Series B Security
has been paid or duly provided for. The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the May 15 or November 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
This Series B Security was issued pursuant to the Exchange Offer
pursuant to which the 7.25% Senior Notes due 2009, Series A, and related
Guarantees (herein called the "Series A Securities") in like principal amount
were exchanged for the Series B Securities and related Guarantees. The Series B
Securities rank pari passu in right of payment with the Series A Securities.
For any period in which the Series A Security exchanged for this Series
B Security was outstanding, in the event that (a) the Exchange Offer
Registration Statement
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<PAGE> 22
shall not have been filed with the Commission on or prior to the 90th calendar
day following the date of original issue of the Series A Securities, (b) the
Shelf Registration Statement shall not have been filed with the Commission on or
prior to the date is was required to be filed in accordance with the terms of
the Registration Rights Agreement, (c) the Exchange Offer Registration Statement
shall not have been declared effective within 180 days following the date of the
original issue of the Series A Securities, (d) a Shelf Registration Statement
required to be filed shall not have been declared effective on or prior to 120
days after it was filed, (e) the Exchange Offer shall not have been consummated
on or prior to the 225th calendar day following the date of original issue of
the Series A Securities, or (f) the Exchange Offer Registration Statement or the
Shelf Registration Statement shall have been filed and declared effective but
shall thereafter be withdrawn or become subject to an effective stop order
suspending its effectiveness (except as specifically permitted in the
Registration Rights Agreement) without being succeeded immediately by an
additional registration statement which becomes effective (each such event
referred to in clauses (a) through (f) above, a "Registration Default"), the
interest rate borne by the Series A Securities shall have increased by
one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) shall have increased by an
additional one-quarter of one percent each 90-day period that such additional
interest continued to accrue under any such circumstance, with an aggregate
maximum increase in the interest rate equal to one percent (1%) per annum.
Immediately following the cure of a Registration Default the accrual of
additional interest with respect to that particular Registration Default shall
have ceased; provided, however, that, if after any such reduction in interest
rate, a different event specified in clause (a) through (e) shall have occurred,
the interest rate again shall have increased pursuant to the foregoing
provisions. To the extent that interest at such increased rate shall not have
been paid or duly provided for with respect to the Series A Security exchanged
for this Series B Security, interest on this Series B Security shall accrue at
such increased rate, from the most recent Interest Payment Date to which
interest at such increased rate on the Series A Security exchanged for this
Series B Security has been paid or duly provided for, to the date on which the
particular Registration Default shall have been cured.
Payment of the principal of (and premium, if any) and interest
on this Security will be made at the office or agency of the Company maintained
for that purpose in Cincinnati, Ohio, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; PROVIDED, HOWEVER, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity
date of this Security does not fall on a Business Day, payment of interest or
principal otherwise payable on such day need not be made on such day, but may be
made on the next
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<PAGE> 23
succeeding Business Day with the same form and effect as if made on such
Interest Payment Date or the maturity date of this Security.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By..................................
Attest:
....................................
Section 203. FORM OF REVERSE OF SECURITY.
(a) The form of the reverse of the Series A Securities shall
be substantially as follows:
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
First Supplemental Indenture dated as of June 25, 1999 (as so supplemented,
herein called the "Indenture"), between the Company, the Guarantors named
therein and the Trustee, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Guarantors named therein, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof,
limited in aggregate principal amount to $350,000,000.
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<PAGE> 24
The Securities of this series will be redeemable, in whole or
in part, at the option of the Company at any time at a redemption price equal to
the greater of (i) 100% of the principal amount of such Securities or (ii) as
determined by a Quotation Agent, the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including any portion
of such payments of interest accrued as of the date of redemption) discounted to
the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate plus 10 basis
points, plus, in each case, accrued interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days but
not more than 60 days before the Redemption Date to each holder of the
Securities to be redeemed. Unless the Company defaults in payment of the
redemption price, on and after the Redemption Date, interest will cease to
accrue on the Securities or portions thereof called for redemption.
The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the
principal of all Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of 50% in aggregate principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange therefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25%
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in principal amount of the Outstanding Securities shall have made written
request, and offered reasonable indemnity, to the Trustee to institute such
proceeding as trustee, and the Trustee shall not have received from the Holders
of a majority in principal amount of the Outstanding Securities a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days; PROVIDED, HOWEVER, that such limitations do not apply
to a suit instituted by the Holder hereof for the enforcement of payment of the
principal of (and premium, if any) or any interest on this Security on or after
the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of like tenor, of a different authorized denomination, as requested by the
Holder surrendering the same.
Except where otherwise specifically provided in the Indenture,
no service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
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<PAGE> 26
(b) The form of the reverse of the Series B Securities shall
be substantially as follows:
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
First Supplemental Indenture dated as of June 25, 1999 (as so supplemented,
herein called the "Indenture"), between the Company, the Guarantors named
therein and the Trustee, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof, limited in aggregate principal
amount to $350,000,000.
The Securities of this series will be redeemable, in whole or
in part, at the option of the Company at any time at a redemption price equal to
the greater of (i) 100% of the principal amount of such Securities or (ii) as
determined by a Quotation Agent, the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including any portion
of such payments of interest accrued as of the date of redemption) discounted to
the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate plus 10 basis
points, plus, in each case, accrued interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days but
not more than 60 days before the Redemption Date to each holder of the
Securities to be redeemed. Unless the Company defaults in payment of the
redemption price, on and after the Redemption Date, interest will cease to
accrue on the Securities or portions thereof called for redemption.
The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the
principal of all Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of
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50% in aggregate principal amount of the Securities at the time Outstanding of
each series to be affected. The Indenture also contains provisions permitting
the Holders of specified percentages in principal amount of the Securities of
each series at the time Outstanding, on behalf of the Holders of all the
Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange therefor or in lieu hereof, whether or not notation of
such consent or waiver is made upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in principal amount of the Outstanding Securities a direction inconsistent with
such request and shall have failed to institute such proceeding within 60 days;
PROVIDED, HOWEVER, that such limitations do not apply to a suit instituted by
the Holder hereof for the enforcement of payment of the principal of (and
premium, if any) or any interest on this Security on or after the respective due
dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like
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<PAGE> 28
aggregate principal amount of Securities of like tenor, of a different
authorized denomination, as requested by the Holder surrendering the same.
Except where otherwise specifically provided in the Indenture,
no service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Section 204. FORM OF GUARANTEE.
The form of Guarantee shall be set forth on the Securities
substantially as follows:
GUARANTEE
For value received, each of the undersigned hereby absolutely, fully
and unconditionally and irrevocably guarantees, jointly and severally with each
other Guarantor, to the holder of this Security the payment of principal of,
premium, if any, and interest on this Security upon which this Guarantee is
endorsed in the amounts and at the time when due and payable whether by
declaration thereof, or otherwise, and interest on the overdue principal and
interest, if any, of this Security, if lawful, and the payment or performance of
all other obligations of the Company under the Indenture or the Securities, to
the holder of this Security and the Trustee, all in accordance with and subject
to the terms and limitations of this Security and Article Six of the First
Supplemental Indenture to the Indenture. This Guarantee will not become
effective until the Trustee duly executes the certificate of authentication on
this Security. This Guarantee shall be governed by and construed in accordance
with the laws of the State of New York, without regard to conflict of law
principles thereof.
Dated:
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<PAGE> 29
Attest* : The Guarantors listed on Schedule I hereto
By:
- -------------------------- ------------------------------------------
Name:
Title:
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC., as Guarantor of the Securities
By:
- -------------------------- ------------------------------------------
Name:
Title:
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By:
- -------------------------- ------------------------------------------
Assistant Secretary Name:
Title:
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
By:
- -------------------------- ------------------------------------------
Assistant Secretary Name:
Title:
- --------------
* Signing as duly authorized officer for each such Guarantor.
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<PAGE> 30
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By:
- -------------------------- ------------------------------------------
Name:
Title:
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<PAGE> 31
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
- ----------------- ---------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
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<PAGE> 32
Name of Guarantor State of Organization
- ----------------- ---------------------
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
Section 205. GLOBAL SECURITIES.
(a) Each Global Security initially shall (i) be registered in
the name of the Depositary for such Global Security or the nominee of such
Depositary, (ii) be deposited with, or on behalf of, the Depositary or with the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 202.
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<PAGE> 33
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depositary, or the Trustee as its
custodian, or under such Global Security, and the Depositary may be treated by
the Company, the Guarantors, the Trustee and any agent of the Company or the
Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Guarantors, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or shall impair, as between the Depositary and its
Agent Members, the operation of customary practices governing the exercise of
the rights of a holder of any Security.
(b) [Intentionally Omitted.]
(c) If any Global Security is to be exchanged for other
Securities or canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Section 205 and the Indenture. If any Global
Security is to be exchanged for other Securities or canceled in part, or if
another Security is to be exchanged in whole or in part for a beneficial
interest in any Global Security, then either (i) such Global Security shall be
so surrendered for exchange or cancellation as provided in this Section 205 and
the Indenture or (ii) the principal amount thereof shall be reduced or increased
by an amount equal to the portion thereof to be so exchanged or canceled, or
equal to the principal amount of such other Security to be so exchanged for a
beneficial interest therein, as the case may be, by means of an appropriate
adjustment made on the records of the Trustee, as Security Registrar, whereupon
the Trustee, in accordance with the Applicable Procedures, shall instruct the
Depositary or its authorized representative to make a corresponding adjustment
to its records. Upon any such surrender or adjustment of a Global Security, the
Trustee shall, subject to this Section 205 and the Indenture, authenticate and
deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative which is given or
made pursuant to this Section 205 and the Indenture if such order, direction or
request is given or made in accordance with the Applicable Procedures.
(d) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such
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<PAGE> 34
Security is registered in the name of a Person other than the Depositary for
such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a
Global Security, shall be the Holder of such Global Security for all purposes
under the Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. TRANSFER AND EXCHANGE.
(a) CERTAIN TRANSFERS AND EXCHANGES. Transfers and exchanges
of Securities and beneficial interests in a Global Security of the kinds
specified in this Section 301 shall be made only in accordance with this Section
301.
(i) RULE 144A GLOBAL SECURITY TO REGULATION S GLOBAL
SECURITY. If the owner of a beneficial interest in the Rule
144A Global Security wishes at any time to transfer such
interest to a Person who wishes to acquire the same in the
form of a beneficial interest in the Regulation S Global
Security, such transfer may be effected only in accordance
with the provisions of this paragraph and paragraph (iv) below
and subject to the Applicable Procedures. Upon receipt by the
Trustee, as Security Registrar, of (a) an order given by the
Depositary or its authorized representative directing that a
beneficial interest in the Regulation S Global Security in a
specified principal amount be credited to a specified Agent
Member's account and that a beneficial interest in the Rule
144A Global Security in an equal principal amount be debited
from another specified Agent Member's account and (b) a
Regulation S Certificate in the form of Exhibit A hereto,
satisfactory to the Trustee and duly executed by the owner of
such beneficial interest in the Rule 144A Global Security or
his attorney duly authorized in writing, then the Trustee, as
Security Registrar but subject to paragraph (iv) below, shall
reduce the principal amount of the Rule 144A Global Security
and increase the principal amount of the Regulation S Global
Security by such specified principal amount as provided in
Section 205(c).
(ii) REGULATION S GLOBAL SECURITY TO RULE 144A GLOBAL
SECURITY. If the owner of a beneficial interest in the
Regulation S Global Security
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<PAGE> 35
wishes at any time to transfer such interest to a Person who
wishes to acquire the same in the form of a beneficial
interest in the Rule 144A Global Security, such transfer may
be effected only in accordance with this paragraph (ii) and
subject to the Applicable Procedures. Upon receipt by the
Trustee, as Security Registrar, of (a) an order given by the
Depositary or its authorized representative directing that a
beneficial interest in the Rule 144A Global Security in a
specified principal amount be credited to a specified Agent
Member's account and that a beneficial interest in the
Regulation S Global Security in an equal principal amount be
debited from another specified Agent Member's account and (b)
if such transfer is to occur during the Restricted Period, a
Restricted Securities Certificate in the form of Exhibit B
hereto, satisfactory to the Trustee and duly executed by the
owner of such beneficial interest in the Regulation S Global
Security or his attorney duly authorized in writing, then the
Trustee, as Security Registrar, shall reduce the principal
amount of the Regulation S Global Security and increase the
principal amount of the Rule 144A Global Security by such
specified principal amount as provided in Section 205(c).
(iii) EXCHANGES BETWEEN GLOBAL SECURITY AND
NON-GLOBAL SECURITY. A beneficial interest in a Global
Security may be exchanged for a Security that is not a Global
Security as provided in Section 301(b), PROVIDED that, if such
interest is a beneficial interest in the Rule 144A Global
Security, or if such interest is a beneficial interest in the
Regulation S Global Security and such exchange is to occur
during the Restricted Period, then such interest shall bear
the appropriate Private Placement Legend (subject in each case
to Section 301(b). Securities which are not in global form may
not be exchanged for beneficial interests in any global note
unless the transferor first delivers to the trustee a written
certificate to the effect that the transfer will comply with
the appropriate transfer restrictions applicable to those
securities.
(iv) REGULATION S GLOBAL SECURITY TO BE HELD THROUGH
EUROCLEAR OR CEDEL DURING RESTRICTED PERIOD. The Company shall
use its reasonable efforts to cause the Depositary to ensure
that, until the expiration of the Restricted Period,
beneficial interests in the Regulation S Global Security may
be held only in or through accounts maintained at the
Depositary by Euroclear or Cedel (or by Agent Members acting
for the account thereof), and no person shall be entitled to
effect any transfer or exchange that would result in any such
interest being held otherwise than in or through such an
account; PROVIDED that this paragraph (iv) shall not prohibit
any transfer or exchange of such an interest in accordance
with paragraph (ii) above.
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<PAGE> 36
(b) PRIVATE PLACEMENT LEGENDS. Rule 144A Securities and their
Successor Securities and Regulation S Securities and their Successor Securities
shall bear a Private Placement Legend, subject to the following:
(i) subject to the following clauses of this Section
301(b), a Security or any portion thereof which is exchanged,
upon transfer or otherwise, for a Global Security or any
portion thereof shall bear the Private Placement Legend borne
by such Global Security while represented thereby;
(ii) subject to the following Clauses of this Section
301(b), a new Security which is not a Global Security and is
issued in exchange for another Security (including a Global
Security) or any portion thereof, upon transfer or otherwise,
shall bear the Private Placement Legend borne by such other
Security;
(iii) Exchange Securities, and all other Securities
sold or otherwise disposed of pursuant to an effective
registration statement under the Securities Act, together with
their respective Successor Securities, shall not bear a
Private Placement Legend;
(iv) at any time after the Securities may be freely
transferred without registration under the Securities Act or
without being subject to transfer restrictions pursuant to the
Securities Act, a new Security which does not bear a Private
Placement Legend may be issued in exchange for or in lieu of a
Security (other than a Global Security) or any portion thereof
which bears such a legend if the Trustee has received an
Unrestricted Securities Certificate substantially in the form
of Exhibit C hereto, satisfactory to the Trustee and duly
executed by the Holder of such legended Security or his
attorney duly authorized in writing, and after such date and
receipt of such certificate, the Trustee shall authenticate
and deliver such a new Security in exchange for or in lieu of
such other Security as provided in this Section 301 and the
Indenture;
(v) a new Security which does not bear a Private
Placement Legend may be issued in exchange for or in lieu of a
Security (other than a Global Security) or any portion thereof
which bears such a legend if, in the Company's judgment,
placing such a legend upon such new Security is not necessary
to ensure compliance with the registration requirements of the
Securities Act, and the Trustee, at the direction of the
Company, shall authenticate and deliver such a new Security as
provided in this Section 301 and the Indenture; and
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<PAGE> 37
(vi) notwithstanding the foregoing provisions of this
Section 301(b), a Successor Security of a Security that does
not bear a particular form of Private Placement Legend shall
not bear such form of legend unless the Company has reasonable
cause to believe that such Successor Security is a "restricted
security" within the meaning of Rule 144, in which case the
Trustee, at the direction of the Company, shall authenticate
and deliver a new Security bearing a Private Placement Legend
in exchange for such Successor Security as provided in this
Section 301 and the Indenture.
By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Security Registrar shall retain copies of all letters,
notices and other written communications received pursuant to Section 205 or
this Section 301. The Company shall have the right to inspect and make copies of
all such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Security Registrar.
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. TITLE AND TERMS.
There shall be a series of securities designated as the "7.25%
Senior Notes due 2009, Series A" of the Company (the "Series A Securities" or
the "Initial Securities") and a series of securities designated as the "7.25%
Senior Notes due 2009, Series B" of the Company (the "Series B Securities" and,
together with the Series A Securities, the "Securities"). The Stated Maturity of
the Securities shall be June 1, 2009, and they shall bear interest at the rate
of 7.25% per annum, subject to increase as set forth in the Registration Rights
Agreement.
Interest on the Securities of this series will be payable
semi-annually on June 1 and December 1 of each year, commencing December 1,
1999, until the principal thereof is made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will be paid to the Person in whose name the Securities of this series (or one
or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the May 15 or November 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
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<PAGE> 38
In the case where any Interest Payment Date or the maturity
date of the Securities of this series does not fall on a Business Day, payment
of interest or principal otherwise payable on such date need not be made on such
day, but may be made on the next succeeding Business Day with the same force and
effect as if made on such Interest Payment Date or the maturity date of the
Securities of this series.
The aggregate principal amount of Securities of this series
which may be authenticated and delivered under this First Supplemental Indenture
is limited to $350,000,000, except for Securities authenticated and delivered
upon registration or transfer of, or in exchange for, or in lieu of, other
Securities of this series pursuant to Section 304, 305 and 306 of the Indenture
and except for any Securities of this series which, pursuant to Section 303 of
the Indenture, are deemed never to have been authenticated and delivered under
the Indenture.
The Securities of this series will be represented by one or
more Global Securities representing the entire $350,000,000 aggregate principal
amount of the Securities of this series, and the Depositary with respect to such
Global Security or Global Securities will be The Depository Trust Company.
The Place of Payment for the principal of (and premium, if
any) and interest on the Securities of this series shall be the office or agency
of the Company in the City of Cincinnati, State of Ohio, maintained for such
purpose, which shall be the Corporate Trust Office of the Trustee and at any
other office or agency maintained by the Company for such purpose; PROVIDED,
HOWEVER, that at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.
The Securities of this series are redeemable prior to maturity
at the option of the Company as provided in this First Supplemental Indenture.
The Securities of this series are not subject to a sinking
fund and the provisions of Section 501(3) and Article Twelve of the Indenture
shall not be applicable to the Securities of this series.
The Securities of this series are subject to defeasance at the
option of the Company as provided in this First Supplemental Indenture.
For all purposes hereunder, the Series A Securities and the
Series B Securities will be treated as one class and are together referred to as
the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
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<PAGE> 39
ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. MODIFICATIONS TO THE CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE PROVISIONS.
With respect to the Securities of this series, Section 801 of
the Indenture shall be deleted in its entirety and the following shall be
substituted therefor:
"Section 801. COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR
CONVEY PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge with or into or
consolidate with any corporation, partnership, or other entity
or sell, lease or convey all or substantially all of its
assets to any other Person, unless (i) either the Company
shall be the continuing corporation, or the successor entity
or the Person which acquires by sale, lease or conveyance all
or substantially all the assets of the Company (if other than
the Company) shall be a corporation or partnership organized
under the laws of the United States of America or any State
thereof or the District of Columbia and shall expressly assume
all obligations of the Company under this Indenture and the
Securities of the series created by the First Supplemental
Indenture, including the due and punctual payment of the
principal of and interest on all the Securities of the series
created by the First Supplemental Indenture according to their
tenor, and the due and punctual performance and observance of
all of the covenants and conditions of the Indenture to be
performed or observed by the Company, by supplemental
indenture in form satisfactory to the Trustee, executed and
delivered to the Trustee by such entity, and (ii) the Company,
such person or such successor entity, as the case may be,
shall not, immediately after such merger or consolidation, or
such sale, lease or conveyance, be in default in the
performance of any such covenant or condition and, immediately
after giving effect to such transaction, no Event of Default,
and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have happened and be
continuing.
Section 802. SUCCESSOR SUBSTITUTED
Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any sale, lease or
conveyance of all or substantially all of the assets of the
Company in accordance
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with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which
such sale, lease or conveyance is made shall succeed to, and
be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if
such successor Person had been named as the Company herein,
and thereafter, except in the case of a lease, the predecessor
Person shall be relieved of all obligations and covenants
under this Indenture and the Securities."
Section 502. OTHER MODIFICATIONS.
With respect to the Securities of this series, the Indenture
shall be modified as follows:
(a) The eighth paragraph of Section 305 of the Indenture shall
be modified by inserting ", and a successor Depositary is not appointed by the
Company within 90 days" at the end of clause (i) in such paragraph; and
(b) Section 401 of the Indenture shall be modified by adding
to the end of such Section the following paragraph:
"For the purpose of this Section 401, trust funds may consist
of (A) money in an amount, or (B) U.S. Government Obligations
(as defined in Section 1304) which through the scheduled
payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one
day before the due date of any payment, money in an amount, or
(C) a combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, to pay and discharge, the principal of, premium, if
any, and each installment of interest on the Securities of
this series on the Stated Maturity of such principal or
installment of interest on the day on which such payments are
due and payable in accordance with the terms of this Indenture
and of such Securities of this series."
Section 503. ADDITIONAL COVENANTS; DEFEASANCE AND COVENANT DEFEASANCE.
(a) With respect to the Securities of this series, the
following provisions shall be added as Sections 1009 and 1010 and as Article
Thirteen (Section references contained in these additional provisions are to the
Indenture as supplemented by this First Supplemental Indenture):
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"Section 1009. LIMITATIONS ON LIENS.
After the date hereof and so long as any Securities of the
series created by the First Supplemental Indenture are
Outstanding, the Company will not issue, assume or guarantee,
and will not permit any Restricted Subsidiary to issue, assume
or guarantee, any Indebtedness which is secured by a mortgage,
pledge, security interest, lien or encumbrance of any kind
(including any conditional sale or other title retention
agreement, any lease in the nature thereof, and any agreement
to give any of the foregoing) (each being hereinafter referred
to as a "lien" or "liens") of or upon any Operating Property
or Operating Asset, whether now owned or hereafter acquired,
of the Company or any Restricted Subsidiary without
effectively providing that the Securities of the series
created by the First Supplemental Indenture (together with, if
the Company shall so determine, any other Indebtedness of the
Company ranking equally with the Securities) shall be equally
and ratably secured by a lien on such assets ranking ratably
with and equal to (or at the Company's option prior to) such
secured Indebtedness; provided that the foregoing restriction
shall not apply to:
(a) liens on any property or assets of any corporation
existing at the time such corporation becomes a Restricted
Subsidiary provided that such lien does not extend to any
other property of the Company or any of its Restricted
Subsidiaries;
(b) liens on any property or assets (including stock) existing
at the time of acquisition of such property or assets by the
Company or a Restricted Subsidiary, or liens to secure the
payment of all or any part of the purchase price of such
property or assets (including stock) upon the acquisition of
such property or assets by the Company or a Restricted
Subsidiary or to secure any indebtedness incurred, assumed or
guaranteed by the Company or a Restricted Subsidiary for the
purpose of financing all or any part of the purchase price of
such property or, in the case of real property, construction
or improvements thereon or attaching to property substituted
by the Company to obtain the release of a lien on other
property of the Company on which a lien then exists, which
indebtedness is incurred, assumed or guaranteed prior to, at
the time of, or within 18 months after such acquisition (or in
the case of real property, the completion of construction
(including any improvements on an existing asset) or
commencement of full operation at such property, whichever is
later (which in the case of a retail store is the opening of
the store for business to the public)); provided that in the
case of any such acquisition, construction or improvement, the
lien shall not apply to any other property or assets
theretofore owned by the Company or a Restricted Subsidiary;
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(c) liens on any property or assets to secure Indebtedness of
a Restricted Subsidiary to the Company or to another
Restricted Subsidiary;
(d) liens on any property or assets of a corporation existing
at the time such corporation is merged into or consolidated
with the Company or a Restricted Subsidiary or at the time of
a purchase, lease or other acquisition of the assets of a
corporation or firm as an entirety or substantially as an
entirety by the Company or a Restricted Subsidiary provided
that such lien does not extend to any other property of the
Company or any of its Restricted Subsidiaries;
(e) liens on any property or assets of the Company or a
Restricted Subsidiary in favor of the United States of America
or any State thereof, or any department, agency or
instrumentality or political subdivision of the United States
of America or any State thereof, or in favor of any other
country, or any political subdivision thereof, to secure
partial, progress, advance or other payments pursuant to any
contract or statute or to secure any Indebtedness incurred or
guaranteed for the purpose of financing all or any part of the
purchase price (or, in the case of real property, the cost of
construction) of the property or assets subject to such liens
(including, but not limited to, liens incurred in connection
with pollution control, industrial revenue or similar
financings);
(f) liens existing on properties or assets of the Company or
any Restricted Subsidiary existing on the date hereof;
provided that such liens secure only those obligations which
they secure on the date hereof or any extension, renewal or
replacement thereof;
(g) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part, of
any lien referred to in the foregoing clauses (a) through (f),
inclusive; provided that such extension, renewal or
replacement shall be limited to all or a part of the property
or assets which secured the lien so extended, renewed or
replaced (plus improvements and construction on real
property);
(h) liens imposed by law, such as mechanics', workmen's,
repairmen's, materialmen's, carriers', warehouseman's,
vendors', or other similar liens arising in the ordinary
course of business of the Company or a Restricted Subsidiary,
or governmental (federal, state or municipal) liens arising
out of contracts for the sale of products or services by the
Company or any Restricted Subsidiary, or deposits or pledges
to obtain the release of any of the foregoing liens;
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(i) pledges, liens or deposits under worker's compensation
laws or similar legislation and liens or judgments thereunder
which are not currently dischargeable, or in connection with
bids, tenders, contracts (other than for the payment of money)
or leases to which the Company or any Restricted Subsidiary is
a party, or to secure the public or statutory obligations of
the Company or any Restricted Subsidiary, or in connection
with obtaining or maintaining self-insurance or to obtain the
benefits of any law, regulation or arrangement pertaining to
unemployment insurance, old age pensions, social security or
similar matters, or to secure surety, appeal or customs bonds
to which the Company or any Restricted Subsidiary is a party,
or in litigation or other proceedings such as, but not limited
to, interpleader proceedings, and other similar pledges, liens
or deposits made or incurred in the ordinary course of
business;
(j) liens created by or resulting from any litigation or other
proceeding which is being contested in good faith by
appropriate proceedings, including liens arising out of
judgments or awards against the Company or any Restricted
Subsidiary with respect to which the Company or such
Restricted Subsidiary is in good faith prosecuting an appeal
or proceedings for review or for which the time to make an
appeal has not yet expired; or final unappealable judgment
liens which are satisfied within 30 days of the date of
judgment; or liens incurred by the Company or any Restricted
Subsidiary for the purpose of obtaining a stay or discharge in
the course of any litigation or other proceeding to which the
Company or such Restricted Subsidiary is a party;
(k) liens for taxes or assessments or governmental charges or
levies not yet due or delinquent, or which can thereafter be
paid without penalty, or which are being contested in good
faith by appropriate proceedings; landlord's liens on property
held under lease; and any other liens or charges incidental to
the conduct of the business of the Company or any Restricted
Subsidiary or the ownership of the property or assets of any
of them which were not incurred in connection with the
borrowing of money or the obtaining of advances or credit and
which do not, in the opinion of the Company, materially impair
the use of such property or assets in the operation of the
business of the Company or such Restricted Subsidiary or the
value of such property or assets for the purposes of such
business; or
(l) liens not permitted by clauses (a) through (k) above if at
the time of, and after giving effect to, the creation or
assumption of any such lien, the aggregate amount of all
Indebtedness of the Company and its Restricted Subsidiaries
secured by all such liens not so permitted by clauses (a)
through (k) above together with the Attributable Debt in
respect of Sale and
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Lease-Back Transactions permitted by paragraph (a) of Section
1010 does not exceed 10% of Consolidated Net Tangible Assets.
Section 1010. LIMITATIONS ON SALE AND LEASE-BACK TRANSACTIONS.
After the date hereof and so long as any Securities of the
series created by the First Supplemental Indenture are
Outstanding, the Company agrees that it will not, and will not
permit any Restricted Subsidiary to, enter into any
arrangement with any Person providing for the leasing by the
Company or a Restricted Subsidiary of any Operating Property
or Operating Asset (other than any such arrangement involving
a lease for a term, including renewal rights, for not more
than 3 years and leases between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries), whereby such
Operating Property or Operating Asset has been or is to be
sold or transferred by the Company or any Restricted
Subsidiary to such Person (herein referred to as a "Sale and
Lease-Back Transaction"), unless:
(a) the Company or such Restricted Subsidiary would, at
the time of entering into a Sale and Lease-Back transaction,
be entitled to incur Indebtedness secured by a lien on the
Operating Property or Operating Asset to be leased in an
amount at least equal to the Attributable Debt in respect of
such Sale and Lease-Back Transaction without equally and
ratably securing the Securities of the series created by the
First Supplemental Indenture pursuant to Section 1009; or
(b) the proceeds of the sale of the Operating Property
or Operating Asset to be leased are at least equal to the fair
market value of such Operating Property or Operating Asset (as
determined by the chief financial officer or chief accounting
officer of the Company) and an amount in cash equal to the net
proceeds from the sale of the Operating Property or Operating
Asset so leased is applied, within 180 days of the effective
date of any such Sale and Lease-Back Transaction, to the
purchase or acquisition (or, in the case of Operating
Property, the construction) of Operating Property or Operating
Assets or to the retirement, repurchase, redemption or
repayment (other than at maturity or pursuant to a mandatory
sinking fund or redemption provision and other than
Indebtedness owned by the Company or any Restricted
Subsidiary) of Securities of the series created by the First
Supplemental Indenture or of Funded Indebtedness of the
Company ranking on a parity with or senior to the Securities
of the series created by the First Supplemental Indenture, or
in the case of a Sale and Lease-Back Transaction by a
Restricted Subsidiary, of Funded Indebtedness of such
Restricted Subsidiary; provided that in connection with any
such
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retirement, any related loan commitment or the like shall be
reduced in an amount equal to the principal amount so retired.
The foregoing restriction shall not apply to, in the
case of any Operating Property or Operating Asset acquired or
constructed subsequent to the date eighteen months prior to
the date of this Indenture, any Sale and Lease-Back
Transaction with respect to such Operating Asset or Operating
Property (including presently owned real property upon which
such Operating Property is to be constructed) if a binding
commitment is entered into with respect to such Sale and
Lease-Back Transaction within 18 months after the later of the
acquisition of the Operating Property or Operating Asset or
the completion of improvements or construction thereon or
commencement of full operations at such Operating Property
(which in the case of a retail store is the opening of the
store for business to the public).
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
Section 1301. COMPANY'S OPTION TO EFFECT DEFEASANCE OR
COVENANT DEFEASANCE.
The Company may at its option by Board Resolution, at any
time, elect to have either Section 1302 or Section 1303 applied to the
Outstanding Securities of this series upon compliance with the
conditions set forth below in this Article Thirteen.
Section 1302. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be deemed to have
been discharged from its obligations with respect to the Outstanding
Securities of the series created by the First Supplemental Indenture on
the date the conditions set forth below are satisfied (hereinafter,
"Defeasance"). For this purpose, such Defeasance means that the Company
shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities of this series and to have
satisfied all its other obligations under such Securities of this
series and this Indenture insofar as such Securities of this series are
concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of Outstanding Securities of this
series to receive, solely from the trust fund described in Section 1304
and as more fully set forth in such Section, payments in respect of the
principal of (and
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premium, if any) and interest on such securities when such payments are
due, (B) the Company's obligations with respect to such Securities of
this series under Sections 304, 305, 306, 1002 and 1003, (C) the
rights, powers, trusts, duties and immunities of the Trustee hereunder
and (D) this Article Thirteen. Subject to compliance with this Article
Thirteen, the Company may exercise its option under this Section 1302
notwithstanding the prior exercise of its option under Section 1303.
Section 1303. COVENANT DEFEASANCE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be released from its
obligations under Section 501(4) (in respect of the covenants in
Sections 1008 through 1010), Section 801 and Sections 1008 through
1010, the Securities of this series and the Holders of Securities of
this series, on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant Defeasance"). For this purpose, such
covenant Defeasance means that the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation
set forth in any such Section, whether directly or indirectly, by
reason of any reference elsewhere herein to any such Section or by
reason of any reference in any such Section to any other provision
herein or in any other document, but the remainder of this Indenture
and such Securities of this series shall be unaffected thereby.
Section 1304. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to application of either
Section 1302 or Section 1303 to the Outstanding Securities of this
series:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 609 who shall agree to
comply with the provisions of this Article Thirteen applicable
to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such
Securities of this series, (A) money in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (C) a
combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
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Trustee, to pay and discharge, and which shall be applied by
the Trustee (or other qualifying trustee) to pay and
discharge, the principal of, premium, if any, and each
installment of interest on the Securities of this series on
the Stated Maturity of such principal or installment of
interest on the day on which such payments are due and payable
in accordance with the terms of this Indenture and of such
Securities of this series. For this purpose, "U.S. Government
Obligations" means securities that are (x) direct obligations
of the United States of America for the payment of which its
full faith and credit is pledged or (y) obligations of a
Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of
which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the
Company thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the
Securities Act of 1933, as amended) as custodian with respect
to any such U.S. Government Obligation or a specific payment
of principal of or interest on any such U.S. Government
Obligation held by such custodian for the account of the
holder of such depository receipt, PROVIDED that (except as
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such
depositary receipt from any amount received by the custodian
in respect of the U.S. Government Obligation or the specific
payment of principal of or interest on the U.S. Government
Obligation evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or
lapse of time or both would become an Event of Default shall
have occurred and be continuing on the date of such deposit
or, insofar as subsections 501(6) and (7) are concerned, at
any time during the period ending on the 121st day after the
date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such
period).
(3) Such Defeasance or covenant Defeasance shall not
cause the Trustee to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with
respect to any securities of the Company.
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(4) Such Defeasance or covenant Defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound.
(5) The Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to
either the Defeasance under Section 1302 or the covenant
Defeasance under Section 1303 (as the case may be) have been
complied with.
(6) In the case of an election under Section 1302,
the Company shall have delivered to the Trustee an Opinion of
Counsel stating that (x) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling, or (y) since the date of this First Supplemental
Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that and based
thereon such opinion shall confirm that, the Holders of the
Outstanding Securities of this series will not recognize
income, gain or loss for Federal income tax purposes as a
result of such Defeasance or covenant Defeasance and will be
subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if
such Defeasance or covenant Defeasance had not occurred."
Section 1305. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS
TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying
trustee--collectively, for purposes of this Section 1305, the
"Trustee") pursuant to Section 1304 in respect of the Securities of
this series shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities of this series and
this Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Securities of this
series, of all sums due and to become due thereon in respect of
principal (and premium, if any) and interest, but such money need not
be segregated from other funds except to the extent required by law.
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The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 1304 or the
principal and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders
of the Outstanding Securities of this series.
Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from
time to time upon Company Request any money or U.S. Government
Obligations held by it as provided in Section 1304 which, in the
opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent Defeasance or covenant
Defeasance.
Section 1306. REINSTATEMENT.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 1302 or 1303 by reason of any order or
judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Securities of this series
shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Thirteen until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with
Section 1302 or 1303; PROVIDED, HOWEVER, that if the Company makes any
payment of principal of (and premium, if any) or interest on any
Security of this series following the reinstatement of its obligations,
the Company shall be subjugated to the rights of the Holders of such
Securities of this series to receive such payment from the money held
by the Trustee or the Paying Agent.
Section 504. REDEMPTION OF SECURITIES.
With respect to Securities of this series, Section 1101 of the
Indenture shall be deleted in its entirety and the following shall be
substituted therefor:
"Section 1101. OPTIONAL REDEMPTION.
The Securities will be redeemable, in whole or in part, at the
option of the Company at any time at a redemption price equal
to the greater of (i) 100% of the principal amount of such
Securities or (ii) as determined by a Quotation Agent, the sum
of the present values of the remaining scheduled payments of
principal and interest thereon (not including any portion of
such payments of interest accrued as of the date of
redemption) discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate plus 10
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basis points plus, in each case, accrued interest thereon to
the date of redemption."
ARTICLE SIX
GUARANTEE
Section 601. GUARANTEE.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of the Indenture or
the Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Obligations") will be promptly paid in full or performed, all in accordance
with the terms of the Indenture and the Securities; and (b) in case of any
extension of time of payment or renewal of any Obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at Stated Maturity, by acceleration or otherwise.
If the Company shall fail to pay when due, or to perform, any Obligations, for
whatever reason, each Guarantor shall be obligated to pay, or to perform or
cause the performance of, the same immediately. An Event of Default under the
Indenture or the Securities shall constitute an event of default under this
Guarantee, and shall entitle the Holders of Securities to accelerate the
Obligations of the Guarantor hereunder in the same manner and to the same extent
as the Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Obligations may be accelerated as provided in Article Five of
the Indenture for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition
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preventing such acceleration in respect of the Obligations, and (b) in the event
of any acceleration of such Obligations as provided in Article Five of the
Indenture, such Obligations (whether or not due and payable) shall forthwith
become due and payable by the Guarantor for the purposes of its Guarantee.
Section 602. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Obligations, and also waives notice of acceptance of its Guarantee and
notice of protest for nonpayment.
Section 603. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee
constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Obligations.
Section 604. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 610 of this First Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or
for any reason (other than the indefeasible payment in full
in cash of the Obligations), including any claim of waiver, release, surrender,
alteration or compromise of any of the Obligations, and shall not be subject to
any defense or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each of the Guarantors hereunder shall not be discharged or impaired or
otherwise affected by the failure of the Trustee or any Holder of the Securities
to assert any claim or demand or to enforce any remedy under the Indenture or
the Securities, any other guarantee or any other agreement, by any waiver or
modification of any provision of any thereof, by any default, failure or delay,
willful or otherwise, in the performance of the Obligations, or by any other act
or omission that may or might in any manner or to any extent vary the risk of
any Guarantor or that would otherwise operate as a discharge of any Guarantor as
a matter of law or equity (other than the indefeasible payment in full in cash
of all the Obligations).
Section 605. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other
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Guarantor or the unenforceability of the Obligations or any part thereof from
any cause, or the cessation from any cause of the liability of the Company,
other than final and indefeasible payment in full in cash of the Obligations.
Each of the Guarantors waives any defense arising out of any such election even
though such election operates to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of each of the Guarantors
against the Company or any security.
Section 606. CONTINUED EFFECTIVENESS.
Subject to Section 610 of this First Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Obligation is
rescinded or must otherwise be restored by the Trustee or any Holder of the
Securities upon the bankruptcy or reorganization of the Company.
Section 607. SUBROGATION.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Obligations, and thereupon the
Holders shall, assign (except to the extent that such assignment would render a
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Obligations
owed to it and paid by such Guarantor pursuant to this Guarantee to such
Guarantor, such assignment to be PRO RATA to the extent the Obligations in
question were discharged by such Guarantor, or make such other disposition
thereof as such Guarantor shall direct (all without recourse to the Holders, and
without any representation or warranty by the Holders). If (a) a Guarantor shall
make payment to the Holders of all or any part of the Obligations and (b) all
the Obligations and all other amounts payable under this First Supplemental
Indenture shall be indefeasibly paid in full, the Trustee will, at such
Guarantor's request, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Obligations resulting from such payment by such Guarantor.
Section 608. INFORMATION.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature,
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scope and extent of the risks that each of the Guarantors assumes and incurs
hereunder, and agrees that the Trustee and the Holders of the Securities will
have no duty to advise the Guarantors of information known to it or any of them
regarding such circumstances or risks.
Section 609. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Obligations to the Trustee;
PROVIDED, HOWEVER, that any right of subrogation that such Guarantor may have
pursuant to this First Supplemental Indenture is subject to Section 607 hereof.
Section 610. TERMINATION.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this First Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Service and Standard and Poor's Rating
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged from
its obligations under this First Supplemental Indenture and its Guarantee if,
upon consummation of such sale, exchange, transfer or other disposition (by
merger or otherwise), such Guarantor remains or becomes a guarantor under any
Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this First Supplemental Indenture and its
Guarantee.
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Section 611. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such guarantor, provisions similar to those set forth in Section
610 hereof.
Section 612. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become a Guarantor under this First Supplemental Indenture, if it has not
already done so or unless the Guarantor is prohibited from doing so by
applicable law or a provision of a contract to which it is a party or by which
it is bound.
Section 613. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
by such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Title 11 of the United States Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal of
state law. To effectuate the foregoing intention, the Holders and such Guarantor
hereby irrevocably agree that the obligations of such Guarantor under this First
Supplemental Indenture and its Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of, any other Guarantor in respect of the obligations of such
Guarantor under its Guarantee or pursuant to its contribution obligations under
this First Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
Section 614. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
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Section 615. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Obligations or against the Company or any
other Person or any property of the Company or any other Person before the
Trustee, such Holder or such other Person is entitled to demand payment and
performance by any or all Guarantors of their liabilities and obligations under
their Guarantee.
Section 616. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Obligations as the Holders may see fit or
change any such application in whole or in part from time to time as the Holders
may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 617. EXECUTION AND DELIVERY OF THE GUARANTEE.
(a) To further evidence the Guarantee set forth in this
Article Six, each Guarantor hereby agrees that a notation of such Guarantee
shall be endorsed on each Security authenticated and delivered by the Trustee
and executed by either manual or facsimile signature of an officer of each
Guarantor. The corporate seal of a Guarantor may be reproduced on the executed
Guarantee and the execution thereof may be attested
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<PAGE> 56
to by any appropriate officer of the Guarantor, but neither such reproduction
nor such attestation is or shall be required.
(b) Each of the Guarantors hereby agrees that its Guarantee
set forth in this Article Six shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such
Guarantee.
(c) If an officer of a Guarantor whose signature is on this
First Supplemental Indenture or a Guarantee no longer holds that office at the
time the Trustee authenticates such Guarantee or at any time thereafter, such
Guarantor's Guarantee of such Security shall be valid nevertheless.
(d) The delivery of any Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of any Guarantee
set forth in this First Supplemental Indenture on behalf of each Guarantor.
ARTICLE SEVEN
MISCELLANEOUS
Section 701. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this First Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
First Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
First Supplemental Indenture.
(c) All capitalized terms used and not defined herein shall
have the respective meanings assigned to them in the Indenture.
(d) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this First Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
(e) All covenants and agreements in this First Supplemental
Indenture by the Company, the Trustee and each Guarantor shall bind its
respective successors and assigns, whether so expressed or not.
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<PAGE> 57
(f) In case any provisions in this First Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(g) Nothing in this First Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(h) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this First
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this First
Supplemental Indenture as so modified or excluded, as the case may be.
(i) This First Supplemental Indenture shall be governed by and
construed in accordance with the laws of the State of New York.
(j) All amendments to the Indenture made hereby shall have
effect only with respect to the series of Securities created hereby.
(k) All provisions of this First Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this First Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE> 58
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- -------------------------- -----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By* : /s/ Paul Heldman
- -------------------------- -----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- -------------------------- -----------------------------------------
Assistant Secretary Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
By: /s/ Paul Heldman
- -------------------------- -----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: President
- -------------------
* Signing as duly authorized officer for each such Guarantor.
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<PAGE> 59
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /s/ Keith C. Larson
- -------------------------- -----------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
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<PAGE> 60
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steven McMillan
- -------------------------- -----------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 61
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
- -------------------------- By: /s/ William Sicking
Assistant Secretary ---------------------------------------
Name: William Sicking
Title: Trust Officer
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<PAGE> 62
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and President of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
--------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
--------------------------
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<PAGE> 63
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
--------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
--------------------------
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<PAGE> 1
Exhibit 4.3
================================================================================
THE KROGER CO.
AND THE GUARANTORS NAMED HEREIN
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
SECOND SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of June 25, 1999
----------
7.70% SENIOR NOTES DUE 2029
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
Section 101. Definitions.................................................... 2
ARTICLE TWO
SECURITY FORMS
Section 201. Form of Securities of this Series.............................. 10
Section 202. Form of Face of Security....................................... 11
Section 203. Form of Reverse of Security.................................... 20
Section 204. Form of Guarantee.............................................. 25
Section 205. Global Securities.............................................. 29
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. Transfer and Exchange.......................................... 31
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. Title and Terms................................................ 34
ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. Modifications to the Consolidation, Merger, Conveyance,
Transfer or Lease Provisions................................... 36
Section 502. Other Modifications............................................ 37
Section 503. Additional Covenants; Defeasance and Covenant Defeasance....... 38
Section 504. Redemption of Securities....................................... 47
ARTICLE SIX
GUARANTEE
Section 601. Guarantee...................................................... 47
Section 602. Waiver of Demand............................................... 48
Section 603. Guarantee of Payment........................................... 49
Section 604. No Discharge or Diminishment of Guarantee...................... 49
Section 605. Defenses of Company Waived..................................... 49
Section 606. Continued Effectiveness........................................ 49
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<PAGE> 3
Section 607. Subrogation.................................................... 50
Section 608. Information.................................................... 50
Section 609. Subordination.................................................. 50
Section 610. Termination.................................................... 51
Section 611. Guarantees of Other Indebtedness............................... 51
Section 612. Additional Guarantors.......................................... 51
Section 613. Limitation of Guarantor's Liability............................ 52
Section 614. Contribution from Other Guarantors............................. 52
Section 615. No Obligation to Take Action Against the Company............... 52
Section 616. Dealing with the Company and Others............................ 52
Section 617. Execution and Delivery of the Guarantee........................ 53
ARTICLE SEVEN
MISCELLANEOUS
Section 701. Miscellaneous.................................................. 54
-ii-
<PAGE> 4
SECOND SUPPLEMENTAL INDENTURE, dated as of June 25, 1999, among The Kroger
Co., a corporation duly organized and existing under the laws of the State of
Ohio (herein called the "Company"), having its principal office at 1014 Vine
Street, Cincinnati, Ohio 45202, the guarantors listed on the signature pages and
Schedule I hereto (each, a "Guarantor") and Firstar Bank, National Association,
a banking corporation duly organized and existing under the laws of the State of
Ohio, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the Trustee an
Indenture dated as of June 25, 1999 (the "Indenture"), providing for the
issuance from time to time of the Company's unsecured debentures, securities or
other evidences of indebtedness (herein and therein called the "Securities"), to
be issued in one or more series as in the Indenture provided.
Section 201 of the Indenture permits the form of the Securities of any
series to be established pursuant to an indenture supplemental to the Indenture.
Section 301 of the Indenture permits the terms of the Securities of any
series to be established in an indenture supplemental to the Indenture.
Section 901(7) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental to the Indenture for the purpose of establishing the form or terms
of Securities of any series as permitted by Sections 201 and 301 of the
Indenture.
Section 901(9) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental to the Indenture to make any other provisions with respect to
matters or questions arising under the Indenture, provided that such action
shall not adversely affect the interests of the Holders of Securities of any
series in any material respect.
Each of the Guarantors has duly authorized the issuance of a guarantee of
the Securities, as set forth herein, and to provide therefor, each of the
Guarantors has duly authorized the execution and delivery of this Second
Supplemental Indenture.
The Company and the Guarantors, pursuant to the foregoing authority,
propose in and by this Second Supplemental Indenture to establish the terms and
form of the Securities of a new series and to amend and supplement the Indenture
in certain respects with respect to the Securities of such series.
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<PAGE> 5
All things necessary to make this Second Supplemental Indenture a valid
agreement of the Company and the Guarantors, and a valid amendment of and
supplement to the Indenture, have been done.
NOW, THEREFORE, THIS Second Supplemental Indenture WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Securities of the series to be created hereby, as
follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
(a) For all purposes of this Second Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Second
Supplemental Indenture and, where so specified, to the Articles and
Sections of the Indenture as supplemented by this Second Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Second Supplemental Indenture.
(b) For all purposes of the Indenture and this Second Supplemental
Indenture, with respect to the Securities of the series created hereby, except
as otherwise expressly provided or unless the context otherwise requires:
"Adjusted Treasury Rate" means, with respect to any Redemption Date,
the rate per annum equal to the semi-annual equivalent yield to maturity of
the Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date.
-2-
<PAGE> 6
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, Euroclear and
Cedel, in each case to the extent applicable to such transaction and as in
effect at the time of such transfer or transaction.
"Attributable Debt" means, in connection with a Sale and Lease-Back
Transaction, as of any particular time, the aggregate of present values
(discounted at a rate per annum equal to the interest rate borne by the
Securities of the series created by this Second Supplemental Indenture) of
the obligations of the Company or any Restricted Subsidiary for net rental
payments during the remaining primary term of the applicable lease,
calculated in accordance with generally accepted accounting principles. The
term "net rental payments" under any lease for any period shall mean the
sum of the rental and other payments required to be paid in such period by
the lessee thereunder, not including, however, any amounts required to be
paid by such lessee (whether or not designated as rental or additional
rental) on account of maintenance and repairs, reconstruction, insurance,
taxes, assessments, water rates, operating and labor costs or similar
charges required to be paid by such lessee thereunder or any amounts
required to be paid by such lessee thereunder contingent upon the amount of
sales, maintenance and repairs, reconstruction, insurance, taxes,
assessments, water rates or similar charges.
"Book-Entry Security" means any Global Securities bearing the legend
specified in Section 202 evidencing all or part of a series of Securities,
authenticated and delivered to the Depositary for such series or its
nominee, and registered in the name of such Depositary or nominee.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in New York City or Cincinnati, Ohio are
authorized or obligated by law or executive order to close.
"Capital Lease" means any lease of property which, in accordance with
generally accepted accounting principles, should be capitalized on the
lessee's balance sheet or for
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<PAGE> 7
which the amount of the asset and liability thereunder as if so capitalized
should be disclosed in a note to such balance sheet; and "Capitalized Lease
Obligation" means the amount of the liability which should be so
capitalized or disclosed.
"Cedel" means Cedel, S.A. (or any successor securities clearing
agency).
"Commission" means the United States Securities and Exchange
Commission.
"Comparable Treasury Issue" means the United States Treasury security
selected by a Quotation Agent as having a maturity comparable to the
remaining term of the Securities to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice,
in pricing new issues of corporate debt securities of comparable maturity
to the remaining term of such Securities.
"Comparable Treasury Price" means, with respect to any Redemption
Date, (i) the average of the Reference Treasury Dealer Quotations, after
excluding the highest and lowest such Reference Treasury Dealer Quotations
for such Redemption Date, or (ii) if the Trustee obtains fewer than three
such Reference Treasury Dealer Quotations, the average of all such
Quotations.
"Consolidated Net Tangible Assets" means, for the Company and its
Subsidiaries on a consolidated basis determined in accordance with
generally accepted accounting principles, the aggregate amounts of assets
(less depreciation and valuation reserves and other reserves and items
deductible from gross book value of specific asset accounts under generally
accepted accounting principles) which under generally accepted accounting
principles would be included on a balance sheet after deducting therefrom
(a) all liability items except deferred income taxes, commercial paper,
short-term bank Indebtedness, Funded Indebtedness, other long-term
liabilities and shareholders' equity and (b) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles, which in each case would be so included on such balance sheet.
-4-
<PAGE> 8
"Credit Facility" means any credit agreement, loan agreement or credit
facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by the Company or Fred
Meyer, Inc. and outstanding on the date of this Second Supplemental
Indenture, and any refinancing or other restructuring of such agreement or
facility.
"Depositary" means, with respect to the Securities issued in the form
of one or more Book-Entry Securities, The Depository Trust Company ("DTC"),
its nominees and successors, or another Person designated as Depositary by
the Company, which must be a clearing agency registered under the Exchange
Act.
"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).
"Exchange Act" means the Securities Exchange Act of 1934 or any
successor statute, and the rules and regulations promulgated by the
Commission thereunder.
"Exchange Offer" means the exchange offer by the Company of Series B
Securities for Series A Securities to be effected pursuant to the
Registration Rights Agreement.
"Exchange Offer Registration Statement" means the registration
statement under the Securities Act contemplated by the Registration Rights
Agreement.
"Funded Indebtedness" means any Indebtedness maturing by its terms
more than one year from the date of the determination thereof, including
(i) any Indebtedness having a maturity of 12 months or less but by its
terms renewable or extendible at the option of the obligor to a date later
than 12 months from the date of the determination thereof and (ii) rental
obligations payable more than 12 months from the date of determination
thereof under Capital Leases (such rental obligations to be included as
Funded Indebtedness at the amount so capitalized at the date of such
computation and to be included for the purposes of the definition of
Consolidated Net Tangible Assets both as an asset and as Funded
Indebtedness at the amount so capitalized).
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<PAGE> 9
"Global Securities" means the Rule 144A Global Securities, the
Regulation S Global Securities and the Series B Global Securities to be
issued as Book-Entry Securities issued to the Depositary in accordance with
Section 205 hereof.
"Holder" means any holder of any security pursuant to, and in
accordance with, the terms of the Indenture.
"Initial Purchaser" means each of Goldman, Sachs & Co., Banc One
Capital Markets, Inc., Banc of America Securities LLC, Chase Securities
Inc. and Solomon Smith Barney Inc.
"Initial Securities" has the meaning stated in Section 401 hereof.
"Non-Restricted Subsidiary" means any Subsidiary that the Company's
Board of Directors has in good faith declared pursuant to a written
resolution not to be of material importance, either singly or together with
all other Non-Restricted Subsidiaries, to the business of the Company and
its consolidated Subsidiaries taken as a whole.
"Non-U.S. Person" means a Person who is not a "U.S. Person" as defined
in Regulation S under the Securities Act.
"Obligations" has the meaning stated in Section 601 hereof.
"Operating Assets" means all merchandise inventories, furniture,
fixtures and equipment (including all transportation and warehousing
equipment but excluding office equipment and data processing equipment)
owned or leased pursuant to Capital Leases by the Company or a Restricted
Subsidiary.
"Operating Property" means all real property and improvements thereon
owned or leased pursuant to Capital Leases by the Company or a Restricted
Subsidiary and constituting, without limitation, any store, warehouse,
service center or distribution center wherever located, provided that such
term shall not include any store, warehouse, service center or distribution
center which the Company's Board of Directors declares by written
resolution not to be of material
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<PAGE> 10
importance to the business of the Company and its Restricted Subsidiaries.
"Private Placement Legend" has the meaning stated in Section 202
hereof.
"Prospectus" means the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including any such
prospectus supplement with respect to the terms of the offering of any
portion of the Series A Securities covered by a Shelf Registration
Statement, and by all other amendments and supplements to a prospectus,
including post-effective amendments, and in each case including all
material incorporated by reference therein.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Company.
"Reference Treasury Dealer" means (i) Goldman, Sachs & Co. and its
successors; provided, however, that if the foregoing shall cease to be a
primary U.S. Government securities dealer in New York City (a "Primary
Treasury Dealer"), the Company shall substitute therefor another Primary
Treasury Dealer, and (ii) any other Primary Treasury Dealer selected by the
Company.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as
determined by the Company, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) quoted in writing to the Trustee by such Reference Treasury Dealer
at 5:00 p.m. on the third Business Day preceding such Redemption Date.
"Registration Rights Agreement" means the Exchange and Registration
Rights Agreement, dated as of June 25, 1999, by and among the Company, the
Guarantors and the Initial Purchasers, as such agreement may be amended,
modified or supplemented from time to time.
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<PAGE> 11
"Registration Statement" means any registration statement of the
Company and the Guarantors which covers any of the Series A Securities (and
related guarantees) or Series B Securities (and related guarantees)
pursuant to the provisions of the Registration Rights Agreement, and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Regulation S" means Regulation S promulgated under the Securities Act
or any successor rule or regulation substantially to the same effect.
"Regulation S Global Security" means one or more permanent Global
Securities in registered form representing the aggregate principal amount
of Securities sold in reliance on Regulation S under the Securities Act.
"Restricted Period" has the meaning stated in Section 201 hereof.
"Restricted Subsidiaries" means all Subsidiaries other than
Non-Restricted Subsidiaries.
"Rule 144" means Rule 144 promulgated under the Securities Act, any
successor rule or regulation to substantially the same effect or any
additional rule or regulation under the Securities Act that permits
transfers of restricted securities without registration such that the
transferee thereof holds securities that are freely tradable under the
Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act or
any successor rule or regulation to substantially the same effect.
"Rule 144A Global Securities" means one or more permanent Global
Securities in registered form representing the aggregate principal amount
of Securities sold in reliance on Rule 144A under the Securities Act.
"Sale and Lease-Back Transaction" has the meaning specified in Section
1010.
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<PAGE> 12
"Securities" has the meaning stated in Section 401 hereof.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Series A Security" has the meaning stated in Section 401 hereof.
"Series B Security" has the meaning stated in Section 401 hereof.
"Series B Global Securities" means one or more permanent Global
Securities in registered form representing the aggregate principal amount
of Series B Securities exchanged for Series A Securities pursuant to the
Exchange Offer.
"Shelf Registration Statement" means a "shelf" registration statement
of the Company and the Guarantors pursuant to the Registration Rights
Agreement, which covers all of the Registrable Securities (as defined in
the Registration Rights Agreement) on an appropriate form under Rule 415
under the Securities Act, or any similar rule that may be adopted by the
Commission, and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"Subsidiary" means (i) any corporation or other entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by the
Company and/or one or more Subsidiaries or (ii) any partnership of which
more than 50% of the partnership interest is owned by the Company or any
Subsidiary.
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<PAGE> 13
ARTICLE TWO
SECURITY FORMS
Section 201. FORM OF SECURITIES OF THIS SERIES.
The Securities of this series shall be in the form set forth in this
Article. Initial Securities offered and sold in reliance on Rule 144A shall be
issued initially in the form of one or more Rule 144A Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit to an account of a direct or
indirect participant of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Rule 144A Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
Initial Securities offered and sold in reliance on Regulation S shall be
initially issued in the form of one or more Regulation S Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit by the Depositary to an
account of a direct or indirect participant of the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided; provided,
however, that upon such deposit through and including the 40th day after the
later of the commencement of the offering of the Securities and the original
issue date of the Securities (such period through and including such 40th day,
the "Restricted Period"), all such Securities shall be credited to or through
accounts maintained at the Depositary by or on behalf of Euroclear or Cedel
unless exchanged for interests in the Rule 144A Global Securities in accordance
with the transfer and certification requirements described below. The aggregate
principal amount of the Regulation S Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Series B Securities exchanged for Series A Securities shall be issued
initially in the form of one or more Series B Global Securities, substantially
in the form set forth in Section 202, deposited upon issuance with the Trustee,
as custodian for the Depositary, registered in the name of the Depositary or its
nominee, in each case for credit to an account of a direct or indirect
participant of the Depositary, duly executed by the Company and authenticated by
the Trustee as hereinafter provided. The aggregate principal amount of the
Series B Global Securities may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depositary
or its nominee, as hereinafter provided.
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<PAGE> 14
Section 202. FORM OF FACE OF SECURITY.
(a) The form of the face of any Series A Securities authenticated and
delivered hereunder shall be substantially as follows:
Unless and until (i) an Initial Security is sold under an effective
Registration Statement or (ii) an Initial Security is exchanged for a
Series B Security in connection with an effective Registration Statement,
in each case pursuant to the Registration Rights Agreement, then such
Initial Security which is a Rule 144A Global Security and such Initial
Security which is a Regulation S Global Security shall each bear the
respective legend set forth below (a "Private Placement Legend") on the
face thereof:
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<PAGE> 15
[Legend if Rule 144A Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING
OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OF FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH
RULE 903 OR RULE 904 OF REGULATIO S UNDER THE SECURITIES ACT, (3) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES.
[Legend if Regulation S Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
OR DELIVERED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
ANY U.S. PERSON, UNLESS THE NOTES ARE REGISTERED UNDER THE SECURITIES ACT
OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IS
AVAILABLE.
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<PAGE> 16
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF
THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE KROGER CO.
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.
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<PAGE> 17
THE KROGER CO.
7.70% Senior Notes due 2029, Series A
CUSIP No.__________
No. ......... $.........
The Kroger Co., a corporation duly organized and existing under the laws of
the State of Ohio (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to ......................, or registered
assigns, the principal sum of ............................ Dollars on June 1,
2029, and to pay interest thereon from June 25, 1999 or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
semi-annually on June 1 and December 1 in each year, commencing December 1,
1999, at the rate of interest of 7.70% per annum, subject to adjustment as
described in the next paragraph until the principal hereof is paid or made
available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the May 15 or November 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for will forthwith
cease to be payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture.
The Holder of this Series A Security is entitled to the benefits of the
Registration Rights Agreement among the Company, the Guarantors and the Initial
Purchasers, dated June 25, 1999, pursuant to which, subject to the terms and
conditions thereof, the Company and the Guarantors are obligated to consummate
the Exchange Offer pursuant to which the Holder of this Security (and the
related Guarantees) shall have the right to exchange this Security (and the
related Guarantees) for 7.70% Senior Notes due 2029, Series B and related
guarantees (herein called the "Series B Securities") in like principal amount as
provided therein. In addition, the Company and the Guarantors have agreed to use
their reasonable efforts to register the Securities for resale under the
Securities Act through a Shelf Registration Statement in the event that the
Exchange Offer is not consummated within 225 calendar days after the original
issue of
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<PAGE> 18
the Securities or under certain other circumstances. The Series A Securities and
the Series B Securities are together (including related Guarantees) referred to
as the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
In the event that (a) the Exchange Offer Registration Statement is not
filed with the Commission on or prior to the 90th calendar day following the
date of original issue of the Series A Securities, (b) the Shelf Registration
Statement is not filed with the Commission on or prior to the date is was
required to be filed in accordance with the terms of the Registration Rights
Agreement, (c) the Exchange Offer Registration Statement is not declared
effective within 180 days following the date of the original issue of the Series
A Securities, (d) a Shelf Registration Statement required to be filed is not
declared effective on or prior to 120 days after it was filed, (e) the Exchange
Offer is not consummated on or prior to the 225th calendar day following the
date of original issue of the Series A Securities, or (f) the Exchange Offer
Registration Statement or the Shelf Registration Statement is filed and declared
effective but shall thereafter either be withdrawn or become subject to an
effective stop order suspending its effectiveness (except as specifically
permitted in the Registration Rights Agreement) without being succeeded
immediately by an additional registration statement which becomes effective
(each such event referred to in clauses (a) through (f) above, a "Registration
Default"), the interest rate borne by the Series A Securities shall be increased
by one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) will increase by an additional
one-quarter of one percent each 90-day period that such additional interest
continues to accrue under any such circumstance, with an aggregate maximum
increase in the interest rate equal to one percent (1%) per annum. Immediately
following the cure of a Registration Default the accrual of additional interest
with respect to that particular Registration Default will cease.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in Cincinnati, Ohio, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; PROVIDED, HOWEVER, that at the option of the Company payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity date of this
Security does not fall on a Business Day, payment of interest or principal
otherwise payable on such day need not be made on such day, but may be made on
the next succeeding Business Day with the same form and effect as if made on
such Interest Payment Date or the maturity date of this Security.
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<PAGE> 19
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
THE KROGER CO.
By......................................
Attest:
........................................
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<PAGE> 20
(b) The form of the face of any Series B Securities authenticated and
delivered hereunder shall be substantially as follows:
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF
THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE KROGER CO.
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.
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<PAGE> 21
THE KROGER CO.
7.70% Senior Notes due 2029, Series B
CUSIP No. 501044B59
No. ........ $........
The Kroger Co., a corporation duly organized and existing under the laws of
the State of Ohio (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on June 1, 2029, and to pay interest thereon from June 25, 1999 or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing
December 1, 1999, at the rate of interest of 7.70% per annum until the principal
hereof is paid or made available for payment, provided that to the extent
interest has not been paid or duly provided for with respect to the Series A
Security exchanged for this Series B Security, interest on this Series B
Security shall accrue from the most recent Interest Payment Date to which
interest on the Series A Security which was exchanged for this Series B Security
has been paid or duly provided for. The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the May 15 or November 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
This Series B Security was issued pursuant to the Exchange Offer pursuant
to which the 7.70% Senior Notes due 2029, Series A, and related Guarantees
(herein called the "Series A Securities") in like principal amount were
exchanged for the Series B Securities and related Guarantees. The Series B
Securities rank pari passu in right of payment with the Series A Securities.
For any period in which the Series A Security exchanged for this Series B
Security was outstanding, in the event that (a) the Exchange Offer Registration
Statement
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<PAGE> 22
shall not have been filed with the Commission on or prior to the 90th calendar
day following the date of original issue of the Series A Securities, (b) the
Shelf Registration Statement shall not have been filed with the Commission on or
prior to the date is was required to be filed in accordance with the terms of
the Registration Rights Agreement, (c) the Exchange Offer Registration Statement
shall not have been declared effective within 180 days following the date of the
original issue of the Series A Securities, (d) a Shelf Registration Statement
required to be filed shall not have been declared effective on or prior to 120
days after it was filed, (e) the Exchange Offer shall not have been consummated
on or prior to the 225th calendar day following the date of original issue of
the Series A Securities, or (f) the Exchange Offer Registration Statement or the
Shelf Registration Statement shall have been filed and declared effective but
shall thereafter be withdrawn or become subject to an effective stop order
suspending its effectiveness (except as specifically permitted in the
Registration Rights Agreement) without being succeeded immediately by an
additional registration statement which becomes effective (each such event
referred to in clauses (a) through (f) above, a "Registration Default"), the
interest rate borne by the Series A Securities shall have increased by
one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) shall have increased by an
additional one-quarter of one percent each 90-day period that such additional
interest continued to accrue under any such circumstance, with an aggregate
maximum increase in the interest rate equal to one percent (1%) per annum.
Immediately following the cure of a Registration Default the accrual of
additional interest with respect to that particular Registration Default shall
have ceased; provided, however, that, if after any such reduction in interest
rate, a different event specified in clause (a) through (e) shall have occurred,
the interest rate again shall have increased pursuant to the foregoing
provisions. To the extent that interest at such increased rate shall not have
been paid or duly provided for with respect to the Series A Security exchanged
for this Series B Security, interest on this Series B Security shall accrue at
such increased rate, from the most recent Interest Payment Date to which
interest at such increased rate on the Series A Security exchanged for this
Series B Security has been paid or duly provided for, to the date on which the
particular Registration Default shall have been cured.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in Cincinnati, Ohio, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; PROVIDED, HOWEVER, that at the option of the Company payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity date of this
Security does not fall on a Business Day, payment of interest or principal
otherwise payable on such day need not be made on such day, but may be made on
the next
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<PAGE> 23
succeeding Business Day with the same form and effect as if made on such
Interest Payment Date or the maturity date of this Security.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
THE KROGER CO.
By......................................
Attest:
........................................
Section 203. FORM OF REVERSE OF SECURITY.
(a) The form of the reverse of the Series A Securities shall be
substantially as follows:
This Security is one of a duly authorized issue of Securities of the
Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
Second Supplemental Indenture dated as of June 25, 1999 (as so
supplemented, herein called the "Indenture"), between the Company, the
Guarantors named therein and the Trustee, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Guarantors named therein, the Trustee and
the Holders of the Securities and of the terms upon which the Securities
are, and are to be, authenticated and delivered. This Security is one of
the series designated on the face hereof, limited in aggregate principal
amount to $300,000,000.
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<PAGE> 24
The Securities of this series will be redeemable, in whole or in part,
at the option of the Company at any time at a redemption price equal to the
greater of (i) 100% of the principal amount of such Securities or (ii) as
determined by a Quotation Agent, the sum of the present values of the
remaining scheduled payments of principal and interest thereon (not
including any portion of such payments of interest accrued as of the date
of redemption) discounted to the date of redemption on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Adjusted Treasury Rate plus 15 basis points, plus, in each case, accrued
interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the Redemption Date to each holder of the Securities to
be redeemed. Unless the Company defaults in payment of the redemption
price, on and after the Redemption Date, interest will cease to accrue on
the Securities or portions thereof called for redemption.
The Indenture contains provisions for defeasance at any time of (i)
the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case
upon compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the principal of
all Securities of this series may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders of the Securities of each series
to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of 50% in aggregate principal
amount of the Securities at the time Outstanding of each series to be
affected. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series
at the time Outstanding, on behalf of the Holders of all the Securities of
such series, to waive compliance by the Company with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or
not notation of such consent or waiver is made upon this Security.
As set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such Holder
shall have previously given to the Trustee written notice of a continuing
Event of Default, the Holders of not less than 25%
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<PAGE> 25
in principal amount of the Outstanding Securities shall have made written
request, and offered reasonable indemnity, to the Trustee to institute such
proceeding as trustee, and the Trustee shall not have received from the
Holders of a majority in principal amount of the Outstanding Securities a
direction inconsistent with such request and shall have failed to institute
such proceeding within 60 days; PROVIDED, HOWEVER, that such limitations do
not apply to a suit instituted by the Holder hereof for the enforcement of
payment of the principal of (and premium, if any) or any interest on this
Security on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable,
duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued
to the designated transferee or transferees.
The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in
the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of
Securities of like tenor, of a different authorized denomination, as
requested by the Holder surrendering the same.
Except where otherwise specifically provided in the Indenture, no
service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes, whether or not this Security be overdue,
and neither the Company, the Trustee nor any such agent shall be affected
by notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
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<PAGE> 26
(b) The form of the reverse of the Series B Securities shall be
substantially as follows:
This Security is one of a duly authorized issue of Securities of the
Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
Second Supplemental Indenture dated as of June 25, 1999 (as so
supplemented, herein called the "Indenture"), between the Company, the
Guarantors named therein and the Trustee, to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities
and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated
on the face hereof, limited in aggregate principal amount to $300,000,000.
The Securities of this series will be redeemable, in whole or in part,
at the option of the Company at any time at a redemption price equal to the
greater of (i) 100% of the principal amount of such Securities or (ii) as
determined by a Quotation Agent, the sum of the present values of the
remaining scheduled payments of principal and interest thereon (not
including any portion of such payments of interest accrued as of the date
of redemption) discounted to the date of redemption on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Adjusted Treasury Rate plus 15 basis points, plus, in each case, accrued
interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the Redemption Date to each holder of the Securities to
be redeemed. Unless the Company defaults in payment of the redemption
price, on and after the Redemption Date, interest will cease to accrue on
the Securities or portions thereof called for redemption.
The Indenture contains provisions for defeasance at any time of (i)
the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case
upon compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the principal of
all Securities of this series may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders of the Securities of each series
to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of
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50% in aggregate principal amount of the Securities at the time Outstanding
of each series to be affected. The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders
of all the Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under
the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder
and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange therefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
As set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such Holder
shall have previously given to the Trustee written notice of a continuing
Event of Default, the Holders of not less than 25% in principal amount of
the Outstanding Securities shall have made written request, and offered
reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a
majority in principal amount of the Outstanding Securities a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days; PROVIDED, HOWEVER, that such limitations do not
apply to a suit instituted by the Holder hereof for the enforcement of
payment of the principal of (and premium, if any) or any interest on this
Security on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registerable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable,
duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued
to the designated transferee or transferees.
The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in
the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like
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<PAGE> 28
aggregate principal amount of Securities of like tenor, of a different
authorized denomination, as requested by the Holder surrendering the same.
Except where otherwise specifically provided in the Indenture, no
service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes, whether or not this Security be overdue,
and neither the Company, the Trustee nor any such agent shall be affected
by notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
Section 204. FORM OF GUARANTEE.
The form of Guarantee shall be set forth on the Securities substantially as
follows:
GUARANTEE
For value received, each of the undersigned hereby absolutely, fully and
unconditionally and irrevocably guarantees, jointly and severally with each
other Guarantor, to the holder of this Security the payment of principal of,
premium, if any, and interest on this Security upon which this Guarantee is
endorsed in the amounts and at the time when due and payable whether by
declaration thereof, or otherwise, and interest on the overdue principal and
interest, if any, of this Security, if lawful, and the payment or performance of
all other obligations of the Company under the Indenture or the Securities, to
the holder of this Security and the Trustee, all in accordance with and subject
to the terms and limitations of this Security and Article Six of the Second
Supplemental Indenture to the Indenture. This Guarantee will not become
effective until the Trustee duly executes the certificate of authentication on
this Security. This Guarantee shall be governed by and construed in accordance
with the laws of the State of New York, without regard to conflict of law
principles thereof.
Dated:
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Attest*: The Guarantors listed on Schedule I hereto
By*:
- -------------------------------- ---------------------------------------
Name:
Title:
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By:
- -------------------------------- ----------------------------------------
Name:
Title:
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By:
- -------------------------------- ----------------------------------------
Name:
Title:
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
By:
- -------------------------------- ----------------------------------------
Assistant Secretary Name:
Title:
- --------------------------------
*Signing as duly authorized officer for each such Guarantor.
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<PAGE> 30
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By:
- -------------------------------- ----------------------------------------
Name:
Title:
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<PAGE> 31
SCHEDULE I
GUARANTORS
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
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<PAGE> 32
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
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<PAGE> 33
Section 205. GLOBAL SECURITIES.
(a) Each Global Security initially shall (i) be registered in the name of
the Depositary for such Global Security or the nominee of such Depositary, (ii)
be deposited with, or on behalf of, the Depositary or with the Trustee as
custodian for such Depositary and (iii) bear legends as set forth in Section
202.
Members of, or participants in, the Depositary ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by the Depositary, or the Trustee as its custodian, or under such Global
Security, and the Depositary may be treated by the Company, the Guarantors, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Guarantors, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or shall
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a holder of any
Security.
(b) [Intentionally Omitted].
(c) If any Global Security is to be exchanged for other Securities or
canceled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Trustee, as Security Registrar, for exchange or cancellation
as provided in this Section 205 and the Indenture. If any Global Security is to
be exchanged for other Securities or canceled in part, or if another Security is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Section 205 and the Indenture or
(ii) the principal amount thereof shall be reduced or increased by an amount
equal to the portion thereof to be so exchanged or canceled, or equal to the
principal amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, by means of an appropriate adjustment made
on the records of the Trustee, as Security Registrar, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depositary or its
authorized representative to make a corresponding adjustment to its records.
Upon any such surrender or adjustment of a Global Security, the Trustee shall,
subject to this Section 205 and the Indenture, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative
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<PAGE> 34
which is given or made pursuant to this Section 205 and the Indenture if such
order, direction or request is given or made in accordance with the Applicable
Procedures.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under the
Indenture and the Securities, and owners of beneficial interests in a Global
Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. TRANSFER AND EXCHANGE.
(a) CERTAIN TRANSFERS AND EXCHANGES. Transfers and exchanges of Securities
and beneficial interests in a Global Security of the kinds specified in this
Section 301 shall be made only in accordance with this Section 301.
(i) RULE 144A GLOBAL SECURITY TO REGULATION S GLOBAL SECURITY. If the
owner of a beneficial interest in the Rule 144A Global Security wishes at
any time to transfer such interest to a Person who wishes to acquire the
same in the form of a beneficial interest in the Regulation S Global
Security, such transfer may be effected only in accordance with the
provisions of this paragraph and paragraph (iv) below and subject to the
Applicable Procedures. Upon receipt by the Trustee, as Security Registrar,
of (a) an order given by the Depositary or its authorized representative
directing that a beneficial interest in the Regulation S Global Security in
a specified principal amount be credited to a specified Agent Member's
account and that a beneficial interest in the Rule 144A Global Security in
an equal principal amount be debited from another specified Agent Member's
account and (b) a Regulation S Certificate in the form of Exhibit A hereto,
satisfactory to the Trustee and duly executed by the owner of such
beneficial interest in the Rule 144A Global Security or his attorney duly
authorized in writing, then the Trustee, as Security Registrar but subject
to paragraph (iv) below, shall reduce the principal amount of the
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<PAGE> 35
Rule 144A Global Security and increase the principal amount of the
Regulation S Global Security by such specified principal amount as provided
in Section 205(c).
(ii) REGULATION S GLOBAL SECURITY TO RULE 144A GLOBAL SECURITY. If the
owner of a beneficial interest in the Regulation S Global Security wishes
at any time to transfer such interest to a Person who wishes to acquire the
same in the form of a beneficial interest in the Rule 144A Global Security,
such transfer may be effected only in accordance with this paragraph (ii)
and subject to the Applicable Procedures. Upon receipt by the Trustee, as
Security Registrar, of (a) an order given by the Depositary or its
authorized representative directing that a beneficial interest in the Rule
144A Global Security in a specified principal amount be credited to a
specified Agent Member's account and that a beneficial interest in the
Regulation S Global Security in an equal principal amount be debited from
another specified Agent Member's account and (b) if such transfer is to
occur during the Restricted Period, a Restricted Securities Certificate in
the form of Exhibit B hereto, satisfactory to the Trustee and duly executed
by the owner of such beneficial interest in the Regulation S Global
Security or his attorney duly authorized in writing, then the Trustee, as
Security Registrar, shall reduce the principal amount of the Regulation S
Global Security and increase the principal amount of the Rule 144A Global
Security by such specified principal amount as provided in Section 205(c).
(iii) EXCHANGES BETWEEN GLOBAL SECURITY AND NON-GLOBAL SECURITY. A
beneficial interest in a Global Security may be exchanged for a Security
that is not a Global Security as provided in Section 301(b), PROVIDED that,
if such interest is a beneficial interest in the Rule 144A Global Security,
or if such interest is a beneficial interest in the Regulation S Global
Security and such exchange is to occur during the Restricted Period, then
such interest shall bear the appropriate Private Placement Legend (subject
in each case to Section 301(b). Securities which are not in global form may
not be exchanged for beneficial interests in any global note unless the
transferor first delivers to the trustee a written certificate to the
effect that the transfer will comply with the appropriate transfer
restrictions applicable to those securities.
(iv) REGULATION S GLOBAL SECURITY TO BE HELD THROUGH EUROCLEAR OR
CEDEL DURING RESTRICTED PERIOD. The Company shall use its reasonable
efforts to cause the Depositary to ensure that, until the expiration of the
Restricted Period, beneficial interests in the Regulation S Global Security
may be held only in or through accounts maintained at the Depositary by
Euroclear or Cedel (or by Agent Members acting for the account thereof),
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<PAGE> 36
and no person shall be entitled to effect any transfer or exchange that
would result in any such interest being held otherwise than in or through
such an account; PROVIDED that this paragraph (iv) shall not prohibit any
transfer or exchange of such an interest in accordance with paragraph (ii)
above.
(b) PRIVATE PLACEMENT LEGENDS. Rule 144A Securities and their Successor
Securities and Regulation S Securities and their Successor Securities shall bear
a Private Placement Legend, subject to the following:
(i) subject to the following clauses of this Section 301(b), a
Security or any portion thereof which is exchanged, upon transfer or
otherwise, for a Global Security or any portion thereof shall bear the
Private Placement Legend borne by such Global Security while represented
thereby;
(ii) subject to the following Clauses of this Section 301(b), a new
Security which is not a Global Security and is issued in exchange for
another Security (including a Global Security) or any portion thereof, upon
transfer or otherwise, shall bear the Private Placement Legend borne by
such other Security;
(iii) Exchange Securities, and all other Securities sold or otherwise
disposed of pursuant to an effective registration statement under the
Securities Act, together with their respective Successor Securities, shall
not bear a Private Placement Legend;
(iv) at any time after the Securities may be freely transferred
without registration under the Securities Act or without being subject to
transfer restrictions pursuant to the Securities Act, a new Security which
does not bear a Private Placement Legend may be issued in exchange for or
in lieu of a Security (other than a Global Security) or any portion thereof
which bears such a legend if the Trustee has received an Unrestricted
Securities Certificate substantially in the form of Exhibit C hereto,
satisfactory to the Trustee and duly executed by the Holder of such
legended Security or his attorney duly authorized in writing, and after
such date and receipt of such certificate, the Trustee shall authenticate
and deliver such a new Security in exchange for or in lieu of such other
Security as provided in this Section 301 and the Indenture;
(v) a new Security which does not bear a Private Placement Legend may
be issued in exchange for or in lieu of a Security (other than a Global
Security) or any portion thereof which bears such a legend if, in the
Company's judgment, placing such a legend upon such new Security is not
necessary to ensure compliance with the registration requirements of the
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<PAGE> 37
Securities Act, and the Trustee, at the direction of the Company, shall
authenticate and deliver such a new Security as provided in this Section
301 and the Indenture; and
(vi) notwithstanding the foregoing provisions of this Section 301(b),
a Successor Security of a Security that does not bear a particular form of
Private Placement Legend shall not bear such form of legend unless the
Company has reasonable cause to believe that such Successor Security is a
"restricted security" within the meaning of Rule 144, in which case the
Trustee, at the direction of the Company, shall authenticate and deliver a
new Security bearing a Private Placement Legend in exchange for such
Successor Security as provided in this Section 301 and the Indenture.
By its acceptance of any Security bearing the Private Placement Legend,
each Holder of such a Security acknowledges the restrictions on transfer of such
Security set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Security only as provided in this Indenture.
The Security Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 205 or this Section
301. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon the
giving of reasonable written notice to the Security Registrar.
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. TITLE AND TERMS.
There shall be a series of securities designated as the "7.70% Senior Notes
due 2029, Series A" of the Company (the "Series A Securities" or the "Initial
Securities") and a series of securities designated as the "7.70% Senior Notes
due 2029, Series B" of the Company (the "Series B Securities" and, together with
the Series A Securities, the "Securities"). The Stated Maturity of the
Securities shall be June 1, 2029, and they shall bear interest at the rate of
7.70% per annum, subject to increase as set forth in the Registration Rights
Agreement.
Interest on the Securities of this series will be payable semi-annually on
June 1 and December 1 of each year, commencing December 1, 1999, until the
principal thereof is made available for payment. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will be paid
to the Person in whose name
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<PAGE> 38
the Securities of this series (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the May 15 or November 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date.
In the case where any Interest Payment Date or the maturity date of the
Securities of this series does not fall on a Business Day, payment of interest
or principal otherwise payable on such date need not be made on such day, but
may be made on the next succeeding Business Day with the same force and effect
as if made on such Interest Payment Date or the maturity date of the Securities
of this series.
The aggregate principal amount of Securities of this series which may be
authenticated and delivered under this Second Supplemental Indenture is limited
to $300,000,000, except for Securities authenticated and delivered upon
registration or transfer of, or in exchange for, or in lieu of, other Securities
of this series pursuant to Section 304, 305 and 306 of the Indenture and except
for any Securities of this series which, pursuant to Section 303 of the
Indenture, are deemed never to have been authenticated and delivered under the
Indenture.
The Securities of this series will be represented by one or more Global
Securities representing the entire $300,000,000 aggregate principal amount of
the Securities of this series, and the Depositary with respect to such Global
Security or Global Securities will be The Depository Trust Company.
The Place of Payment for the principal of (and premium, if any) and
interest on the Securities of this series shall be the office or agency of the
Company in the City of Cincinnati, State of Ohio, maintained for such purpose,
which shall be the Corporate Trust Office of the Trustee and at any other office
or agency maintained by the Company for such purpose; PROVIDED, HOWEVER, that at
the option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register.
The Securities of this series are redeemable prior to maturity at the
option of the Company as provided in this Second Supplemental Indenture.
The Securities of this series are not subject to a sinking fund and the
provisions of Section 501(3) and Article Twelve of the Indenture shall not be
applicable to the Securities of this series.
The Securities of this series are subject to defeasance at the option of
the Company as provided in this Second Supplemental Indenture.
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<PAGE> 39
For all purposes hereunder, the Series A Securities and the Series B
Securities will be treated as one class and are together referred to as the
"Securities." The Series A Securities rank pari passu in right of payment with
the Series B Securities.
ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. MODIFICATIONS TO THE CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR
LEASE PROVISIONS.
With respect to the Securities of this series, Section 801 of the Indenture
shall be deleted in its entirety and the following shall be substituted
therefor:
"Section 801. Covenant Not to Merge, Consolidate, Sell or Convey
PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge with or into or
consolidate with any corporation, partnership, or other entity or
sell, lease or convey all or substantially all of its assets to any
other Person, unless (i) either the Company shall be the continuing
corporation, or the successor entity or the Person which acquires by
sale, lease or conveyance all or substantially all the assets of the
Company (if other than the Company) shall be a corporation or
partnership organized under the laws of the United States of America
or any State thereof or the District of Columbia and shall expressly
assume all obligations of the Company under this Indenture and the
Securities of the series created by the Second Supplemental Indenture,
including the due and punctual payment of the principal of and
interest on all the Securities of the series created by the Second
Supplemental Indenture according to their tenor, and the due and
punctual performance and observance of all of the covenants and
conditions of the Indenture to be performed or observed by the
Company, by supplemental indenture in form satisfactory to the
Trustee, executed and delivered to the Trustee by such entity, and
(ii) the Company, such person or such successor entity, as the case
may be, shall not, immediately after such merger or consolidation, or
such sale, lease or conveyance, be in default in the performance of
any such covenant or condition and, immediately after giving effect to
such transaction, no Event of Default, and no event which, after
notice or lapse of time or both, would become an Event of Default,
shall have happened and be continuing.
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<PAGE> 40
Section 802. SUCCESSOR SUBSTITUTED
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any sale, lease or conveyance of all or
substantially all of the assets of the Company in accordance with
Section 801, the successor Person formed by such consolidation or into
which the Company is merged or to which such sale, lease or conveyance
is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company
herein, and thereafter, except in the case of a lease, the predecessor
Person shall be relieved of all obligations and covenants under this
Indenture and the Securities."
Section 502. OTHER MODIFICATIONS.
With respect to the Securities of this series, the Indenture shall be
modified as follows:
(a) The eighth paragraph of Section 305 of the Indenture shall be modified
by inserting, "and a successor Depositary is not appointed by the Company
within 90 days" at the end of clause (i) in such paragraph; and
(b) Section 401 of the Indenture shall be modified by adding to the end of
such Section the following paragraph:
"For the purpose of this Section 401, trust funds may consist of (A) money
in an amount, or (B) U.S. Government Obligations (as defined in Section
1304) which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than
one day before the due date of any payment, money in an amount, or (C) a
combination thereof, sufficient, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, the principal of,
premium, if any, and each installment of interest on the Securities of this
series on the Stated Maturity of such principal or installment of interest
on the day on which such payments are due and payable in accordance with
the terms of this Indenture and of such Securities of this series."
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Section 503. ADDITIONAL COVENANTS; DEFEASANCE AND COVENANT DEFEASANCE.
(a) With respect to the Securities of this series, the following provisions
shall be added as Sections 1009 and 1010 and as Article Thirteen (Section
references contained in these additional provisions are to the Indenture as
supplemented by this Second Supplemental Indenture):
"Section 1009. LIMITATIONS ON LIENS.
After the date hereof and so long as any Securities of the series
created by the Second Supplemental Indenture are Outstanding, the Company
will not issue, assume or guarantee, and will not permit any Restricted
Subsidiary to issue, assume or guarantee, any Indebtedness which is secured
by a mortgage, pledge, security interest, lien or encumbrance of any kind
(including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any agreement to give any of the
foregoing) (each being hereinafter referred to as a "lien" or "liens") of
or upon any Operating Property or Operating Asset, whether now owned or
hereafter acquired, of the Company or any Restricted Subsidiary without
effectively providing that the Securities of the series created by the
Second Supplemental Indenture (together with, if the Company shall so
determine, any other Indebtedness of the Company ranking equally with the
Securities) shall be equally and ratably secured by a lien on such assets
ranking ratably with and equal to (or at the Company's option prior to)
such secured Indebtedness; provided that the foregoing restriction shall
not apply to:
(a) liens on any property or assets of any corporation existing
at the time such corporation becomes a Restricted Subsidiary provided
that such lien does not extend to any other property of the Company or
any of its Restricted Subsidiaries;
(b) liens on any property or assets (including stock) existing at
the time of acquisition of such property or assets by the Company or a
Restricted Subsidiary, or liens to secure the payment of all or any
part of the purchase price of such property or assets (including
stock) upon the acquisition of such property or assets by the Company
or a Restricted Subsidiary or to secure any indebtedness incurred,
assumed or guaranteed by the Company or a Restricted Subsidiary for
the purpose of financing all or any part of the purchase price of such
property or, in the case of real property, construction or
improvements thereon or attaching to property substituted by the
Company to obtain the release of a lien on other property of the
Company on which a lien then exists, which indebtedness is incurred,
assumed or
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guaranteed prior to, at the time of, or within 18 months after such
acquisition (or in the case of real property, the completion of
construction (including any improvements on an existing asset) or
commencement of full operation at such property, whichever is later
(which in the case of a retail store is the opening of the store for
business to the public)); provided that in the case of any such
acquisition, construction or improvement, the lien shall not apply to
any other property or assets theretofore owned by the Company or a
Restricted Subsidiary;
(c) liens on any property or assets to secure Indebtedness of a
Restricted Subsidiary to the Company or to another Restricted
Subsidiary;
(d) liens on any property or assets of a corporation existing at
the time such corporation is merged into or consolidated with the
Company or a Restricted Subsidiary or at the time of a purchase, lease
or other acquisition of the assets of a corporation or firm as an
entirety or substantially as an entirety by the Company or a
Restricted Subsidiary provided that such lien does not extend to any
other property of the Company or any of its Restricted Subsidiaries;
(e) liens on any property or assets of the Company or a
Restricted Subsidiary in favor of the United States of America or any
State thereof, or any department, agency or instrumentality or
political subdivision of the United States of America or any State
thereof, or in favor of any other country, or any political
subdivision thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute or to secure any
Indebtedness incurred or guaranteed for the purpose of financing all
or any part of the purchase price (or, in the case of real property,
the cost of construction) of the property or assets subject to such
liens (including, but not limited to, liens incurred in connection
with pollution control, industrial revenue or similar financings);
(f) liens existing on properties or assets of the Company or any
Restricted Subsidiary existing on the date hereof; provided that such
liens secure only those obligations which they secure on the date
hereof or any extension, renewal or replacement thereof;
(g) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part, of any lien
referred to in the foregoing clauses (a) through (f), inclusive;
provided that such extension, renewal or replacement shall be limited
to all or a part of the property or assets which secured the lien so
extended, renewed or replaced (plus improvements and construction on
real property);
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(h) liens imposed by law, such as mechanics', workmen's,
repairmen's, materialmen's, carriers', warehouseman's, vendors', or
other similar liens arising in the ordinary course of business of the
Company or a Restricted Subsidiary, or governmental (federal, state or
municipal) liens arising out of contracts for the sale of products or
services by the Company or any Restricted Subsidiary, or deposits or
pledges to obtain the release of any of the foregoing liens;
(i) pledges, liens or deposits under worker's compensation laws
or similar legislation and liens or judgments thereunder which are not
currently dischargeable, or in connection with bids, tenders,
contracts (other than for the payment of money) or leases to which the
Company or any Restricted Subsidiary is a party, or to secure the
public or statutory obligations of the Company or any Restricted
Subsidiary, or in connection with obtaining or maintaining
self-insurance or to obtain the benefits of any law, regulation or
arrangement pertaining to unemployment insurance, old age pensions,
social security or similar matters, or to secure surety, appeal or
customs bonds to which the Company or any Restricted Subsidiary is a
party, or in litigation or other proceedings such as, but not limited
to, interpleader proceedings, and other similar pledges, liens or
deposits made or incurred in the ordinary course of business;
(j) liens created by or resulting from any litigation or other
proceeding which is being contested in good faith by appropriate
proceedings, including liens arising out of judgments or awards
against the Company or any Restricted Subsidiary with respect to which
the Company or such Restricted Subsidiary is in good faith prosecuting
an appeal or proceedings for review or for which the time to make an
appeal has not yet expired; or final unappealable judgment liens which
are satisfied within 30 days of the date of judgment; or liens
incurred by the Company or any Restricted Subsidiary for the purpose
of obtaining a stay or discharge in the course of any litigation or
other proceeding to which the Company or such Restricted Subsidiary is
a party;
(k) liens for taxes or assessments or governmental charges or
levies not yet due or delinquent, or which can thereafter be paid
without penalty, or which are being contested in good faith by
appropriate proceedings; landlord's liens on property held under
lease; and any other liens or charges incidental to the conduct of the
business of the Company or any Restricted Subsidiary or the ownership
of the property or assets of any of them which were not incurred in
connection with the borrowing of money or the obtaining of advances or
credit and which do not, in the opinion of the Company, materially
impair the use of such property or assets in the
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operation of the business of the Company or such Restricted Subsidiary
or the value of such property or assets for the purposes of such
business; or
(l) liens not permitted by clauses (a) through (k) above if at
the time of, and after giving effect to, the creation or assumption of
any such lien, the aggregate amount of all Indebtedness of the Company
and its Restricted Subsidiaries secured by all such liens not so
permitted by clauses (a) through (k) above together with the
Attributable Debt in respect of Sale and Lease-Back Transactions
permitted by paragraph (a) of Section 1010 does not exceed 10% of
Consolidated Net Tangible Assets.
Section 1010. LIMITATIONS ON SALE AND LEASE-BACK TRANSACTIONS.
After the date hereof and so long as any Securities of the series created
by the Second Supplemental Indenture are Outstanding, the Company agrees that it
will not, and will not permit any Restricted Subsidiary to, enter into any
arrangement with any Person providing for the leasing by the Company or a
Restricted Subsidiary of any Operating Property or Operating Asset (other than
any such arrangement involving a lease for a term, including renewal rights, for
not more than 3 years and leases between the Company and a Restricted Subsidiary
or between Restricted Subsidiaries), whereby such Operating Property or
Operating Asset has been or is to be sold or transferred by the Company or any
Restricted Subsidiary to such Person (herein referred to as a "Sale and
Lease-Back Transaction"), unless:
(a) the Company or such Restricted Subsidiary would, at the time of
entering into a Sale and Lease-Back transaction, be entitled to incur
Indebtedness secured by a lien on the Operating Property or Operating Asset
to be leased in an amount at least equal to the Attributable Debt in
respect of such Sale and Lease-Back Transaction without equally and ratably
securing the Securities of the series created by the Second Supplemental
Indenture pursuant to Section 1009; or
(b) the proceeds of the sale of the Operating Property or Operating
Asset to be leased are at least equal to the fair market value of such
Operating Property or Operating Asset (as determined by the chief financial
officer or chief accounting officer of the Company) and an amount in cash
equal to the net proceeds from the sale of the Operating Property or
Operating Asset so leased is applied, within 180 days of the effective date
of any such Sale and Lease-Back Transaction, to the purchase or acquisition
(or, in the case of Operating Property, the construction) of Operating
Property or Operating Assets or to the retirement, repurchase, redemption
or repayment (other than at maturity or pursuant to a mandatory sinking
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fund or redemption provision and other than Indebtedness owned by the
Company or any Restricted Subsidiary) of Securities of the series created
by the Second Supplemental Indenture or of Funded Indebtedness of the
Company ranking on a parity with or senior to the Securities of the series
created by the Second Supplemental Indenture, or in the case of a Sale and
Lease-Back Transaction by a Restricted Subsidiary, of Funded Indebtedness
of such Restricted Subsidiary; provided that in connection with any such
retirement, any related loan commitment or the like shall be reduced in an
amount equal to the principal amount so retired.
The foregoing restriction shall not apply to, in the case of any
Operating Property or Operating Asset acquired or constructed subsequent to
the date eighteen months prior to the date of this Indenture, any Sale and
Lease-Back Transaction with respect to such Operating Asset or Operating
Property (including presently owned real property upon which such Operating
Property is to be constructed) if a binding commitment is entered into with
respect to such Sale and Lease-Back Transaction within 18 months after the
later of the acquisition of the Operating Property or Operating Asset or
the completion of improvements or construction thereon or commencement of
full operations at such Operating Property (which in the case of a retail
store is the opening of the store for business to the public).
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
Section 1301. COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT
DEFEASANCE.
The Company may at its option by Board Resolution, at any time,
elect to have either Section 1302 or Section 1303 applied to the
Outstanding Securities of this series upon compliance with the
conditions set forth below in this Article Thirteen.
Section 1302. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be deemed to have
been discharged from its obligations with respect to the Outstanding
Securities of the series created by the Second Supplemental Indenture
on the date the conditions set forth below are satisfied (hereinafter,
"Defeasance"). For this purpose, such Defeasance means that the
Company shall be deemed to have paid and discharged the entire
indebtedness represented by the Outstanding Securities of this series
and to have
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satisfied all its other obligations under such Securities of this
series and this Indenture insofar as such Securities of this series
are concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of Outstanding Securities of this
series to receive, solely from the trust fund described in Section
1304 and as more fully set forth in such Section, payments in respect
of the principal of (and premium, if any) and interest on such
securities when such payments are due, (B) the Company's obligations
with respect to such Securities of this series under Sections 304,
305, 306, 1002 and 1003, (C) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and (D) this Article Thirteen.
Subject to compliance with this Article Thirteen, the Company may
exercise its option under this Section 1302 notwithstanding the prior
exercise of its option under Section 1303.
Section 1303. COVENANT DEFEASANCE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be released from
its obligations under Section 501(4) (in respect of the covenants in
Sections 1008 through 1010), Section 801 and Sections 1008 through
1010, the Securities of this series and the Holders of Securities of
this series, on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant Defeasance"). For this purpose, such
covenant Defeasance means that the Company may omit to comply with and
shall have no liability in respect of any term, condition or
limitation set forth in any such Section, whether directly or
indirectly, by reason of any reference elsewhere herein to any such
Section or by reason of any reference in any such Section to any other
provision herein or in any other document, but the remainder of this
Indenture and such Securities of this series shall be unaffected
thereby.
Section 1304. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to application of either
Section 1302 or Section 1303 to the Outstanding Securities of this
series:
(1) The Company shall irrevocably have deposited or caused
to be deposited with the Trustee (or another trustee satisfying
the requirements of Section 609 who shall agree to comply with
the provisions of this Article Thirteen applicable to it) as
trust funds in trust for the purpose of making the following
payments, specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of such Securities of this
series, (A) money in an amount, or (B) U.S.
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Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the due
date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or other
qualifying trustee) to pay and discharge, the principal of,
premium, if any, and each installment of interest on the
Securities of this series on the Stated Maturity of such
principal or installment of interest on the day on which such
payments are due and payable in accordance with the terms of this
Indenture and of such Securities of this series. For this
purpose, "U.S. Government Obligations" means securities that are
(x) direct obligations of the United States of America for the
payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and acting as
an agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which, in
either case, are not callable or redeemable at the option of the
Company thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities
Act of 1933, as amended) as custodian with respect to any such
U.S. Government Obligation or a specific payment of principal of
or interest on any such U.S. Government Obligation held by such
custodian for the account of the holder of such depository
receipt, PROVIDED that (except as required by law) such custodian
is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received
by the custodian in respect of the U.S. Government Obligation or
the specific payment of principal of or interest on the U.S.
Government Obligation evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or lapse
of time or both would become an Event of Default shall have
occurred and be continuing on the date of such deposit or,
insofar as subsections 501(6) and (7) are concerned, at any time
during the period ending on the 121st day after the date of such
deposit (it being understood that
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this condition shall not be deemed satisfied until the expiration
of such period).
(3) Such Defeasance or covenant Defeasance shall not cause
the Trustee to have a conflicting interest as defined in Section
608 and for purposes of the Trust Indenture Act with respect to
any securities of the Company.
(4) Such Defeasance or covenant Defeasance shall not result
in a breach or violation of, or constitute a default under, this
Indenture or any other agreement or instrument to which the
Company is a party or by which it is bound.
(5) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent provided for relating to either the
Defeasance under Section 1302 or the covenant Defeasance under
Section 1303 (as the case may be) have been complied with.
(6) In the case of an election under Section 1302, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) since
the date of this Second Supplemental Indenture there has been a
change in the applicable Federal income tax law, in either case
to the effect that and based thereon such opinion shall confirm
that, the Holders of the Outstanding Securities of this series
will not recognize income, gain or loss for Federal income tax
purposes as a result of such Defeasance or covenant Defeasance
and will be subject to Federal income tax on the same amounts, in
the same manner and at the same times as would have been the case
if such Defeasance or covenant Defeasance had not occurred."
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Section 1305. DEPOSITED MONEY AND U.S. GOVERNMENT
OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee (or other qualifying
trustee--collectively, for purposes of this Section 1305, the
"Trustee") pursuant to Section 1304 in respect of the Securities
of this series shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities of this
series and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Holders of
such Securities of this series, of all sums due and to become due
thereon in respect of principal (and premium, if any) and
interest, but such money need not be segregated from other funds
except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 1304 or the
principal and interest received in respect thereof other than any
such tax, fee or other charge which by law is for the account of
the Holders of the Outstanding Securities of this series.
Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company
from time to time upon Company Request any money or U.S.
Government Obligations held by it as provided in Section 1304
which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of
the amount thereof which would then be required to be deposited
to effect an equivalent Defeasance or covenant Defeasance.
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Section 1306. REINSTATEMENT.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 1302 or 1303 by reason of any
order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application,
then the Company's obligations under this Indenture and the
Securities of this series shall be revived and reinstated as
though no deposit had occurred pursuant to this Article Thirteen
until such time as the Trustee or Paying Agent is permitted to
apply all such money in accordance with Section 1302 or 1303;
PROVIDED, HOWEVER, that if the Company makes any payment of
principal of (and premium, if any) or interest on any Security of
this series following the reinstatement of its obligations, the
Company shall be subjugated to the rights of the Holders of such
Securities of this series to receive such payment from the money
held by the Trustee or the Paying Agent.
Section 504. REDEMPTION OF SECURITIES.
With respect to Securities of this series, Section 1101 of the Indenture
shall be deleted in its entirety and the following shall be substituted
therefor:
"Section 1101. OPTIONAL REDEMPTION.
The Securities will be redeemable, in whole or in part, at the option
of the Company at any time at a redemption price equal to the greater of
(i) 100% of the principal amount of such Securities or (ii) as determined
by a Quotation Agent, the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including any
portion of such payments of interest accrued as of the date of redemption)
discounted to the date of redemption on a semi-annual basis (assuming a
360-day year consisting of twelve 30-day months) at the Adjusted Treasury
Rate plus 15 basis points plus, in each case, accrued interest thereon to
the date of redemption."
ARTICLE SIX
GUARANTEE
Section 601. GUARANTEE.
Each Guarantor hereby jointly and severally fully and unconditionally
guarantees (each a "Guarantee") to each Holder of a Security authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture or the
Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder,
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that (a) the principal of, premium, if any, and interest on the Securities will
be duly and punctually paid in full when due, whether at maturity, upon
redemption, by acceleration or otherwise, and interest on the overdue principal
and (to the extent permitted by law) interest, if any, on the Securities and all
other obligations of the Company or the Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Obligations") will be promptly paid in
full or performed, all in accordance with the terms of the Indenture and the
Securities; and (b) in case of any extension of time of payment or renewal of
any Obligations, the same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at Stated
Maturity, by acceleration or otherwise. If the Company shall fail to pay when
due, or to perform, any Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Obligations of the Guarantor hereunder
in the same manner and to the same extent as the Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Securities or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
of the Indenture or the Securities, any release of any other Guarantor, the
recovery of any judgment against the Company, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Security, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders of Securities and the Trustee, on the other hand, (a) the maturity of
the Obligations may be accelerated as provided in Article Five of the Indenture
for the purposes of the Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Obligations, and (b)
in the event of any acceleration of such Obligations as provided in Article Five
of the Indenture, such Obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantor for the purposes of its
Guarantee.
Section 602. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the Guarantors
waives presentment to, demand of payment from and protest of any of the
Obligations, and also waives notice of acceptance of its Guarantee and notice of
protest for nonpayment.
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Section 603. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee constitutes a
guarantee of payment when due and not of collection, and waives any right to
require that any resort be had by the Trustee or any Holder of the Securities to
the security, if any, held for payment of the Obligations.
Section 604. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 610 of this Second Supplemental Indenture, the
obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Obligations), including any claim of
waiver, release, surrender, alteration or compromise of any of the Obligations,
and shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each of the Guarantors hereunder
shall not be discharged or impaired or otherwise affected by the failure of the
Trustee or any Holder of the Securities to assert any claim or demand or to
enforce any remedy under the Indenture or the Securities, any other guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or omission that may or
might in any manner or to any extent vary the risk of any Guarantor or that
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the
Obligations).
Section 605. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the Guarantors waives
any defense based on or arising out of any defense of the Company or any other
Guarantor or the unenforceability of the Obligations or any part thereof from
any cause, or the cessation from any cause of the liability of the Company,
other than final and indefeasible payment in full in cash of the Obligations.
Each of the Guarantors waives any defense arising out of any such election even
though such election operates to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of each of the Guarantors
against the Company or any security.
Section 606. CONTINUED EFFECTIVENESS.
Subject to Section 610 of this Second Supplemental Indenture, each of the
Guarantors further agrees that its Guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any Obligation is rescinded or must
otherwise be restored by the Trustee or any Holder of the Securities upon the
bankruptcy or reorganization of the Company.
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Section 607. SUBROGATION.
In furtherance of the foregoing and not in limitation of any other right of
each of the Guarantors by virtue hereof, upon the failure of the Company to pay
any Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each of the Guarantors
hereby promises to and will, upon receipt of written demand by the Trustee or
any Holder of the Securities, forthwith pay, or cause to be paid, to the Holders
in cash the amount of such unpaid Obligations, and thereupon the Holders shall,
assign (except to the extent that such assignment would render a Guarantor a
"creditor" of the Company within the meaning of Section 547 of Title 11 of the
United States Code as now in effect or hereafter amended or any comparable
provision of any successor statute) the amount of the Obligations owed to it and
paid by such Guarantor pursuant to this Guarantee to such Guarantor, such
assignment to be PRO RATA to the extent the Obligations in question were
discharged by such Guarantor, or make such other disposition thereof as such
Guarantor shall direct (all without recourse to the Holders, and without any
representation or warranty by the Holders). If (a) a Guarantor shall make
payment to the Holders of all or any part of the Obligations and (b) all the
Obligations and all other amounts payable under this Second Supplemental
Indenture shall be indefeasibly paid in full, the Trustee will, at such
Guarantor's request, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Obligations resulting from such payment by such Guarantor.
Section 608. INFORMATION.
Each of the Guarantors assumes all responsibility for being and keeping
itself informed of the Company's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Obligations and
the nature, scope and extent of the risks that each of the Guarantors assumes
and incurs hereunder, and agrees that the Trustee and the Holders of the
Securities will have no duty to advise the Guarantors of information known to it
or any of them regarding such circumstances or risks.
Section 609. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as provided
above, all rights of such Guarantor against the Company, arising as a result
thereof by way of right of subrogation or otherwise, shall in all respects be
subordinated and junior in right of payment to the prior indefeasible payment in
full in cash of all the Obligations to the Trustee; PROVIDED, HOWEVER, that any
right of subrogation that such Guarantor may have pursuant to this Second
Supplemental Indenture is subject to Section 607 hereof.
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<PAGE> 54
Section 610. TERMINATION.
A Guarantor shall, upon the occurrence of either of the following events,
be automatically and unconditionally released and discharged from all
obligations under this Second Supplemental Indenture and its Guarantee without
any action required on the part of the Trustee or any Holder if such release and
discharge will not result in any downgrade in the rating given to the Securities
by Moody's Investors Service and Standard and Poor's Rating Services:
(a) upon any sale, exchange, transfer or other disposition (by merger
or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged
from its obligations under this Second Supplemental Indenture and its
Guarantee if, upon consummation of such sale, exchange, transfer or other
disposition (by merger or otherwise), such Guarantor remains or becomes a
guarantor under any Credit Facility; or
(b) at the request of the Company, at any time that none of the Credit
Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Second Supplemental Indenture and its
Guarantee.
Section 611. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors, the Company
will cause each of its Subsidiaries that becomes a guarantor in respect of (i)
any Indebtedness of the Company which is outstanding on the date hereof and (ii)
any Indebtedness incurred by the Company after the date hereof (other than in
respect of asset-backed securities), to include in any guarantee given by any
such guarantor, provisions similar to those set forth in Section 610 hereof.
Section 612. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a guarantor in
respect of any Indebtedness of the Company following the date hereof to execute
and deliver a supplemental indenture pursuant to which it will become a
Guarantor under this Second Supplemental Indenture, if it has not already done
so or unless the Guarantor is
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<PAGE> 55
prohibited from doing so by applicable law or a provision of a contract to which
it is a party or by which it is bound.
Section 613. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder, hereby confirms
that it is the intention of all such parties that the Guarantee by such
Guarantor not constitute a fraudulent transfer or conveyance for purposes of
Title 11 of the United States Code, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar Federal of state law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under this Second
Supplemental Indenture and its Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of, any other Guarantor in respect of the obligations of such
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Second Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
Section 614. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its Guarantee
shall be entitled to a contribution from each other Guarantor in a pro rata
amount based on the net assets of each Guarantor, determined in accordance with
generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 615. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall have any
obligation to enforce or exhaust any rights or remedies or take any other steps
under any security for the Obligations or against the Company or any other
Person or any property of the Company or any other Person before the Trustee,
such Holder or such other Person is entitled to demand payment and performance
by any or all Guarantors of their liabilities and obligations under their
Guarantee.
Section 616. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Company or any
other Person;
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<PAGE> 56
(b) take or abstain from taking security or collateral from the
Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect of (with or without consideration)
any and all collateral, mortgages or other security given by the Company or
any third party with respect to the Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security to such part of the Obligations as the Holders may see fit or
change any such application in whole or in part from time to time as the
Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal with,
the Company and all other Persons and any security as the Holders or the
Trustee may see fit.
Section 617. EXECUTION AND DELIVERY OF THE GUARANTEE.
(a) To further evidence the Guarantee set forth in this Article Six, each
Guarantor hereby agrees that a notation of such Guarantee shall be endorsed on
each Security authenticated and delivered by the Trustee and executed by either
manual or facsimile signature of an officer of each Guarantor. The corporate
seal of a Guarantor may be reproduced on the executed Guarantee and the
execution thereof may be attested to by any appropriate officer of the
Guarantor, but neither such reproduction nor such attestation is or shall be
required.
(b) Each of the Guarantors hereby agrees that its Guarantee set forth in
this Article Six shall remain in full force and effect notwithstanding any
failure to endorse on each Security a notation of such Guarantee.
(c) If an officer of a Guarantor whose signature is on this Second
Supplemental Indenture or a Guarantee no longer holds that office at the time
the Trustee authenticates such Guarantee or at any time thereafter, such
Guarantor's Guarantee of such Security shall be valid nevertheless.
(d) The deliver of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Second Supplemental Indenture on behalf of each Guarantor.
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<PAGE> 57
ARTICLE SEVEN
MISCELLANEOUS
Section 701. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture, as
supplemented by this Second Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Second Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Second Supplemental Indenture.
(c) All capitalized terms used and not defined herein shall have the
respective meanings assigned to them in the Indenture.
(d) Each of the Company and the Trustee makes and reaffirms as of the date
of execution of this Second Supplemental Indenture all of its respective
representations, covenants and agreements set forth in the Indenture.
(e) All covenants and agreements in this Second Supplemental Indenture by
the Company, the Trustee and each Guarantor shall bind its respective successors
and assigns, whether so expressed or not.
(f) In case any provisions in this Second Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
(g) Nothing in this Second Supplemental Indenture, express or implied,
shall give to any Person, other than the parties hereto and their successors
under the Indenture and the Holders of the series of Securities created hereby,
any benefit or any legal or equitable right, remedy or claim under the
Indenture.
(h) If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act of 1939, as may be amended from time to time, that is
required under such Act to be a part of and govern this Second Supplemental
Indenture, the latter provision shall control. If any provision hereof modifies
or excludes any provision of such Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Second Supplemental Indenture
as so modified or excluded, as the case may be.
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<PAGE> 58
(i) This Second Supplemental Indenture shall be governed by and construed
in accordance with the laws of the State of New York.
(j) All amendments to the Indenture made hereby shall have effect only with
respect to the series of Securities created hereby.
(k) All provisions of this Second Supplemental Indenture shall be deemed to
be incorporated in, and made a part of, the Indenture; and the Indenture, as
supplemented by this Second Supplemental Indenture, shall be read, taken and
construed as one and the same instrument.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE> 59
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- --------------------------------- ---------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By*: /s/ Paul Heldman
- --------------------------------- --------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- --------------------------------- ---------------------------------------
Name: Bruce Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ Bruce M. Gack By: /s/ Paul Heldman
- --------------------------------- ---------------------------------------
Secretary Name: Paul Heldman
Title: President
- ---------------------------------
*Signing as duly authorized officer for each such Guarantor.
-56-
<PAGE> 60
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /s/ Keith C. Larson
---------------------------------------
Name: Keith C. Larson
Title: Vice President Secretary
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<PAGE> 61
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve McMillan
----------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 62
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ William Sicking
- -------------------------------- ---------------------------------------
Assistant Secretary Name: William Sicking
Title: Trust Officer
-59-
<PAGE> 63
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came _____________,
to me known, who, being by me duly sworn, did depose and say that he is
__________________ of The Kroger Co., and ____________________ of each of the
Guarantors Listed on Schedule I hereto and President of Kroger Dedicated
Logistics Co., corporations described in and which executed the foregoing
instrument; that he knows the seals of said corporations; that the seals affixed
to said instrument are such corporate seals; that they were so affixed by
authority of the Boards of Directors of said corporations, and that he signed
his name thereto by like authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 64
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
----------------------------------------
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<PAGE> 65
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 66
EXHIBIT A
REGULATION S CERTIFICATE
(For transfers pursuant to section 301(a)(i) of the Indenture)
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 7.70% Securities due 2029
Reference is hereby made to the Indenture, dated as of June 25, 1999 as
amended by the Second Supplemental Indenture, dated as of June 25, 1999
(collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$____________ principal amount of Securities,
which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Regulation S
Global Security. In connection with such transfer, the Owner hereby certifies
that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 904 or Rule 144 under the Securities Act and with all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) RULE 904 TRANSFERS. If the transfer is being effected in
accordance with Rule 904:
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<PAGE> 67
(A) the Owner is not a distributor of the Securities, an
affiliate of the Company or any such distributor or a person acting on
behalf of any of the foregoing;
(B) the offer of the Specified Securities was not made to a
person in the United States;
(C) either:
(i) at the time the buy order was originated, the Transferee
was outside the United States or the Owner and any person acting
on its behalf reasonably believed that the Transferee was outside
the United States, or
(ii) the transaction is being executed in, on or through the
facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another designated
offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts have been made in the United
States by or on behalf of the Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities or has received a
selling concession, fee or other remuneration in respect of the
Specified Securities, and the transfer is to occur during the
Restricted Period, then the requirements of Rule 904(c)(1) have been
satisfied;
(F) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(G) if the transfer occurs during the Restricted Period, the
interest transferred will be held immediately through Euroclear or
Cedel.
(2) RULE 144 TRANSFERS. If the transfer is being effected pursuant to
Rule 144:
(A) the transfer is occurring after a holding period of at least
one year (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last
-2-
<PAGE> 68
acquired from the Company or from an affiliate of the Company,
whichever is later, and is being effected in accordance with the
applicable amount, manner of sale and notice requirements of Rule 144;
or
(B) the transfer is occurring after a holding period of at least
two years has elapsed since the Specified Securities were last
acquired from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.
-3-
<PAGE> 69
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated: (Print the name of the Undersigned, as
such term is defined in the second
paragraph of this certificate.)
By:
------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
-4-
<PAGE> 70
EXHIBIT B
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to section 301(a)(ii) of the Indenture)
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 7.70% Securities due 2029
Reference is hereby made to the Indenture, dated as of June 25, 1999 as
amended by the Second Supplemental Indenture, dated as of June 25, 1999
(collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company")"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
ISIN No(s). If any.____________________
CERTIFICATE No(s)._____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Restricted
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant to an effective registration
statement under the Securities Act, it is being effected in accordance with Rule
144A or Rule 144 under the Securities Act and all applicable securities laws of
the states of the United States and other jurisdictions. Accordingly, the Owner
hereby further certifies as follows:
(1) RULE 144A TRANSFERS. If the transfer is being effected in
accordance with Rule 144A:
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<PAGE> 71
(A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believe
is a "qualified institutional buyer" within the meaning of Rule 144A,
acquiring for its own account or for the account of a qualified
institutional buyer; and
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Rule 144A in connection with the transfer; and
(2) RULE 144 TRANSFERS. If the transfer is being effected pursuant to
Rule 144:
(A) the transfer is occurring after a holding period of at least
one year (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last acquired from the
Company or from an affiliate of the Company, whichever is later, and
is being effected in accordance with the applicable amount, manner of
sale and notice requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at least
two years has elapsed since the Specified Securities were last
acquired from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.
-2-
<PAGE> 72
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as
such term is defined in the second
paragraph of this certificate.)
By:
------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
-3-
<PAGE> 73
EXHIBIT C
UNRESTRICTED SECURITIES CERTIFICATE
(For removal of Securities Act Legends pursuant to section 301(b))
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 7.70% Securities due 2029
Reference is hereby made to the Indenture, dated as of June 25, 1999 as
amended by the Second Supplemental Indenture, dated as of June 25, 1999
(collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s). ___________________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be exchanged for
Securities bearing no Private Placement Legend pursuant to Section 301(b) of the
Indenture. In connection with such exchange, the Owner hereby certifies that the
exchange is occurring after a holding period of at least two years (computed in
accordance with paragraph (d) of Rule 144) has elapsed since the Specified
Securities were last acquired from the Company or from an affiliate of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company. The Owner also
acknowledges that any future transfers of the Specified Securities must
-1-
<PAGE> 74
comply with all applicable securities laws of the states of the United States
and other jurisdictions.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as
such term is defined in the second
paragraph of this certificate.)
By:
------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
-2-
<PAGE> 75
SCHEDULE I
GUARANTORS
Name of Guarantor State or Organization
- --------------------------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
-1-
<PAGE> 76
Name of Guarantor State or Organization
- --------------------------------------------------------------------------------
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
-2-
<PAGE> 77
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is a ____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 1
Exhibit 4.4
================================================================================
THE KROGER CO.
AND THE GUARANTORS NAMED HEREIN
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
THIRD SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of June 25, 1999
----------
6.34% SENIOR NOTES DUE 2001
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE ONE
DEFINITIONS
<S> <C>
SECTION 101. DEFINITIONS..........................................................................................2
ARTICLE TWO
SECURITY FORMS
Section 201. Form of Securities of this Series...................................................................8
Section 202. Form of Face of Security............................................................................9
Section 203. Form of Reverse of Security........................................................................19
Section 204. Form of Guarantee..................................................................................23
Section 205. Global Securities..................................................................................28
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. Transfer and Exchange..............................................................................29
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. Title and Terms.....................................................................................32
ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. Modifications to the Consolidation, Merger, Conveyance, Transfer or Lease Provisions................34
Section 502. Other Modifications.................................................................................35
Section 503. Additional Covenants; Defeasance and Covenant Defeasance............................................35
Section 504. Redemption of Securities............................................................................44
</TABLE>
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<PAGE> 3
<TABLE>
<CAPTION>
ARTICLE SIX
GUARANTEE
<S> <C>
Section 601. Guarantee...........................................................................................44
Section 602. Waiver of Demand....................................................................................45
Section 603. Guarantee of Payment................................................................................46
Section 604. No Discharge or Diminishment of Guarantee...........................................................46
Section 605. Defenses of Company Waived..........................................................................46
Section 606. Continued Effectiveness.............................................................................46
Section 607. Subrogation.........................................................................................47
Section 608. Information.........................................................................................47
Section 609. Subordination.......................................................................................47
Section 610. Termination.........................................................................................48
Section 611. Guarantees of Other Indebtedness....................................................................48
Section 612. Additional Guarantors...............................................................................48
Section 613. Limitation of Guarantor's Liability.................................................................49
Section 614. Contribution from Other Guarantors..................................................................49
Section 615. No Obligation to Take Action Against the Company....................................................49
Section 616. Dealing with the Company and Others.................................................................49
Section 617. Execution and Delivery of the Guarantee.............................................................50
ARTICLE SEVEN
MISCELLANEOUS
Section 701. Miscellaneous.......................................................................................51
</TABLE>
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<PAGE> 4
THIRD SUPPLEMENTAL INDENTURE, dated as of June 25, 1999, among
The Kroger Co., a corporation duly organized and existing under the laws of the
State of Ohio (herein called the "Company"), having its principal office at 1014
Vine Street, Cincinnati, Ohio 45202, the guarantors listed on the signature
pages and Schedule I hereto (each, a "Guarantor") and Firstar Bank, National
Association, a banking corporation duly organized and existing under the laws of
the State of Ohio, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of June 25, 1999 (the "Indenture"), providing for
the issuance from time to time of the Company's unsecured debentures, securities
or other evidences of indebtedness (herein and therein called the "Securities"),
to be issued in one or more series as in the Indenture provided.
Section 201 of the Indenture permits the form of the
Securities of any series to be established pursuant to an indenture supplemental
to the Indenture.
Section 301 of the Indenture permits the terms of the
Securities of any series to be established in an indenture supplemental to the
Indenture.
Section 901(7) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture for the purpose of establishing the
form or terms of Securities of any series as permitted by Sections 201 and 301
of the Indenture.
Section 901(9) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture to make any other provisions with
respect to matters or questions arising under the Indenture, provided that such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect.
Each of the Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly authorized the execution and delivery of this Third
Supplemental Indenture.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Third Supplemental Indenture to establish the
terms and form of the Securities of a new series and to amend and supplement the
Indenture in certain respects with respect to the Securities of such series.
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<PAGE> 5
All things necessary to make this Third Supplemental Indenture
a valid agreement of the Company and the Guarantors, and a valid amendment of
and supplement to the Indenture, have been done.
NOW, THEREFORE, THIS Third Supplemental Indenture WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities of the series to be
created hereby, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
(a) For all purposes of this Third Supplemental Indenture:
(1) Capitalized terms used herein without definition
shall have the meanings specified in the Indenture;
(2) All references herein to Articles and Sections,
unless otherwise specified, refer to the corresponding
Articles and Sections of this Third Supplemental Indenture
and, where so specified, to the Articles and Sections of the
Indenture as supplemented by this Third Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto",
"hereunder" and "herewith" refer to this Third Supplemental
Indenture.
(b) For all purposes of the Indenture and this Third
Supplemental Indenture, with respect to the Securities of the series created
hereby, except as otherwise expressly provided or unless the context otherwise
requires:
"Applicable Procedures" means, with respect to any
transfer or transaction involving a Global Security or
beneficial interest therein, the rules and procedures of the
Depositary for such Security, Euroclear and Cedel, in each
case to the extent applicable to such transaction and as in
effect at the time of such transfer or transaction.
"Attributable Debt" means, in connection with a Sale
and Lease-Back Transaction, as of any particular time, the
aggregate of present values (discounted at a rate per annum
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<PAGE> 6
equal to the interest rate borne by the Securities of the
series created by this Third Supplemental Indenture) of the
obligations of the Company or any Restricted Subsidiary for
net rental payments during the remaining primary term of the
applicable lease, calculated in accordance with generally
accepted accounting principles. The term "net rental payments"
under any lease for any period shall mean the sum of the
rental and other payments required to be paid in such period
by the lessee thereunder, not including, however, any amounts
required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and
repairs, reconstruction, insurance, taxes, assessments, water
rates, operating and labor costs or similar charges required
to be paid by such lessee thereunder or any amounts required
to be paid by such lessee thereunder contingent upon the
amount of sales, maintenance and repairs, reconstruction,
insurance, taxes, assessments, water rates or similar charges.
"Book-Entry Security" means any Global
Securities bearing the legend specified in Section 202
evidencing all or part of a series of Securities,
authenticated and delivered to the Depositary for such series
or its nominee, and registered in the name of such Depositary
or nominee.
"Business Day" means any day other than a Saturday or
Sunday or a day on which banking institutions in New York City
or Cincinnati, Ohio are authorized or obligated by law or
executive order to close.
"Capital Lease" means any lease of property which, in
accordance with generally accepted accounting principles,
should be capitalized on the lessee's balance sheet or for
which the amount of the asset and liability thereunder as if
so capitalized should be disclosed in a note to such balance
sheet; and "Capitalized Lease Obligation" means the amount of
the liability which should be so capitalized or disclosed.
"Cedel" means CEDEL, S.A. (or any successor
securities clearing agency).
"Commission" means the United States Securities and
Exchange Commission.
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<PAGE> 7
"Consolidated Net Tangible Assets" means, for the
Company and its Subsidiaries on a consolidated basis
determined in accordance with generally accepted accounting
principles, the aggregate amounts of assets (less depreciation
and valuation reserves and other reserves and items deductible
from gross book value of specific asset accounts under
generally accepted accounting principles) which under
generally accepted accounting principles would be included on
a balance sheet after deducting therefrom (a) all liability
items except deferred income taxes, commercial paper,
short-term bank Indebtedness, Funded Indebtedness, other
long-term liabilities and shareholders' equity and (b) all
goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, which in each
case would be so included on such balance sheet.
"Credit Facility" means any credit agreement, loan
agreement or credit facility, whether syndicated or not,
involving the extension of credit by banks or other credit
institutions, entered into by the Company or Fred Meyer, Inc.
and outstanding on the date of this Third Supplemental
Indenture, and any refinancing or other restructuring of such
agreement or facility.
"Depositary" means, with respect to the Securities
issued in the form of one or more Book-Entry Securities, The
Depository Trust Company ("DTC"), its nominees and successors,
or another Person designated as Depositary by the Company,
which must be a clearing agency registered under the Exchange
Act.
"Euroclear" means the Euroclear Clearance System (or
any successor securities clearing agency).
"Exchange Act" means the Securities Exchange Act of
1934 or any successor statute, and the rules and regulations
promulgated by the Commission thereunder.
"Exchange Offer" means the exchange offer by the
Company of Series B Securities for Series A Securities to be
effected pursuant to the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the
registration statement under the Securities Act contemplated
by the Registration Rights Agreement.
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<PAGE> 8
"Funded Indebtedness" means any Indebtedness maturing
by its terms more than one year from the date of the
determination thereof, including (i) any Indebtedness having a
maturity of 12 months or less but by its terms renewable or
extendible at the option of the obligor to a date later than
12 months from the date of the determination thereof and (ii)
rental obligations payable more than 12 months from the date
of determination thereof under Capital Leases (such rental
obligations to be included as Funded Indebtedness at the
amount so capitalized at the date of such computation and to
be included for the purposes of the definition of Consolidated
Net Tangible Assets both as an asset and as Funded
Indebtedness at the amount so capitalized).
"Global Securities" means the Rule 144A Global
Securities, the Regulation S Global Securities and the Series
B Global Securities to be issued as Book-Entry Securities
issued to the Depositary in accordance with Section 205
hereof.
"Holder" means any holder of any security pursuant
to, and in accordance with, the terms of the Indenture.
"Initial Purchaser" means each of Goldman, Sachs &
Co., Banc One Capital Markets, Inc., Banc of America
Securities LLC, Chase Securities Inc.
and Solomon Smith Barney Inc.
"Initial Securities" has the meaning stated in
Section 401 hereof.
"Non-Restricted Subsidiary" means any Subsidiary that
the Company's Board of Directors has in good faith declared
pursuant to a written resolution not to be of material
importance, either singly or together with all other
Non-Restricted Subsidiaries, to the business of the Company
and its consolidated Subsidiaries taken as a whole.
"Non-U.S. Person" means a Person who is not a "U.S.
Person" as defined in Regulation S under the Securities Act.
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<PAGE> 9
"Obligations" has the meaning stated in Section 601
hereof.
"Operating Assets" means all merchandise inventories,
furniture, fixtures and equipment (including all
transportation and warehousing equipment but excluding office
equipment and data processing equipment) owned or leased
pursuant to Capital Leases by the Company or a Restricted
Subsidiary.
"Operating Property" means all real property and
improvements thereon owned or leased pursuant to Capital
Leases by the Company or a Restricted Subsidiary and
constituting, without limitation, any store, warehouse,
service center or distribution center wherever located,
provided that such term shall not include any store,
warehouse, service center or distribution center which the
Company's Board of Directors declares by written resolution
not to be of material importance to the business of the
Company and its Restricted Subsidiaries.
"Private Placement Legend" has the meaning stated in
Section 202 hereof.
"Prospectus" means the prospectus included in a
Registration Statement, including any preliminary prospectus,
and any such prospectus as amended or supplemented by any
prospectus supplement, including any such prospectus
supplement with respect to the terms of the offering of any
portion of the Series A Securities covered by a Shelf
Registration Statement, and by all other amendments and
supplements to a prospectus, including post-effective
amendments, and in each case including all material
incorporated by reference therein.
"Registration Rights Agreement" means the Exchange
and Registration Rights Agreement, dated as of June 25, 1999,
by and among the Company, the Guarantors and the Initial
Purchasers, as such agreement may be amended, modified or
supplemented from time to time.
"Registration Statement" means any registration
statement of the Company and the Guarantors which covers any
of the Series A Securities (and related guarantees) or Series
B Securities (and related guarantees) pursuant to the
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<PAGE> 10
provisions of the Registration Rights Agreement, and all
amendments and supplements to any such Registration Statement,
including post-effective amendments, in each case including
the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Regulation S" means Regulation S promulgated under
the Securities Act or any successor rule or regulation
substantially to the same effect.
"Regulation S Global Security" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Securities sold in reliance
on Regulation S under the Securities Act.
"Restricted Period" has the meaning stated in Section
201 hereof.
"Restricted Subsidiaries" means all Subsidiaries
other than Non-Restricted Subsidiaries.
"Rule 144" means Rule 144 promulgated under the
Securities Act, any successor rule or regulation to
substantially the same effect or any additional rule or
regulation under the Securities Act that permits transfers of
restricted securities without registration such that the
transferee thereof holds securities that are freely tradeable
under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the
Securities Act or any successor rule or regulation to
substantially the same effect.
"Rule 144A Global Securities" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Securities sold in reliance
on Rule 144A under the Securities Act.
"Sale and Lease-Back Transaction" has the meaning
specified in Section 1010.
"Securities" has the meaning stated in Section 401
hereof.
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<PAGE> 11
"Securities Act" means the United States Securities
Act of 1933, as amended.
"Series A Security" has the meaning stated in Section
401 hereof.
"Series B Security" has the meaning stated in Section
401 hereof.
"Series B Global Securities" means one or more
permanent Global Securities in registered form representing
the aggregate principal amount of Series B Securities
exchanged for Series A Securities pursuant to the Exchange
Offer.
"Shelf Registration Statement" means a "shelf"
registration statement of the Company and the Guarantors
pursuant to the Registration Rights Agreement, which covers
all of the Registrable Securities (as defined in the
Registration Rights Agreement) on an appropriate form under
Rule 415 under the Securities Act, or any similar rule that
may be adopted by the Commission, and all amendments and
supplements to such registration statement, including
post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"Subsidiary" means (i) any corporation or other
entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at
the time directly or indirectly owned by the Company and/or
one or more Subsidiaries or (ii) any partnership of which more
than 50% of the partnership interest is owned by the Company
or any Subsidiary.
ARTICLE TWO
SECURITY FORMS
Section 201. FORM OF SECURITIES OF THIS SERIES.
The Securities of this series shall be in the form set forth
in this Article. Initial Securities offered and sold in reliance on Rule 144A
shall be issued initially in the
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<PAGE> 12
form of one or more Rule 144A Global Securities, substantially in the form set
forth in Section 202, deposited upon issuance with the Trustee, as custodian for
the Depositary, registered in the name of the Depositary or its nominee, in each
case for credit to an account of a direct or indirect participant of the
Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the Rule 144A Global
Securities may from time to time be increased or decreased by adjustments made
on the records of the Trustee, as custodian for the Depositary or its nominee,
as hereinafter provided.
Initial Securities offered and sold in reliance on Regulation
S shall be initially issued in the form of one or more Regulation S Global
Securities, substantially in the form set forth in Section 202, deposited upon
issuance with the Trustee, as custodian for the Depositary, registered in the
name of the Depositary or its nominee, in each case for credit by the Depositary
to an account of a direct or indirect participant of the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided; provided, however, that upon such deposit through and including the
40th day after the later of the commencement of the offering of the Securities
and the original issue date of the Securities (such period through and including
such 40th day, the "Restricted Period"), all such Securities shall be credited
to or through accounts maintained at the Depositary by or on behalf of Euroclear
or Cedel unless exchanged for interests in the Rule 144A Global Securities in
accordance with the transfer and certification requirements described below. The
aggregate principal amount of the Regulation S Global Securities may from time
to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
Series B Securities exchanged for Series A Securities shall be
issued initially in the form of one or more Series B Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit to an account of a direct or
indirect participant of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Series B Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
Section 202. FORM OF FACE OF SECURITY.
(a) The form of the face of any Series A Securities
authenticated and delivered hereunder shall be substantially as follows:
Unless and until (i) an Initial Security is sold under an
effective Registration Statement or (ii) an Initial Security is exchanged for a
Series B Security in
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<PAGE> 13
connection with an effective Registration Statement, in each case pursuant to
the Registration Rights Agreement, then such Initial Security which is a Rule
144A Global Security and such Initial Security which is a Regulation S Global
Security shall each bear the respective legend set forth below (a "Private
Placement Legend") on the face thereof:
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<PAGE> 14
[Legend if Rule 144A Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT")
AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT
OF FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN
OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT, (3) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (4) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (5) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS
OF THE STATES OF THE UNITED STATES.
[Legend if Regulation S Global Security]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT")
AND MAY NOT BE OFFERED, SOLD, OR DELIVERED IN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S.
PERSON, UNLESS THE NOTES ARE REGISTERED UNDER THE SECURITIES
ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT IS AVAILABLE.
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<PAGE> 15
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITORY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE KROGER CO. 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.
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<PAGE> 16
THE KROGER CO.
6.34% Senior Notes due 2001, Series A
CUSIP No. __________
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing
under the laws of the State of Ohio (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on June 1, 2001, and to pay interest thereon from June 25, 1999 or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing
December 1, 1999, at the rate of interest of 6.34% per annum, subject to
adjustment as described in the next paragraph until the principal hereof is paid
or made available for payment. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the May 15 or November 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
The Holder of this Series A Security is entitled to the
benefits of the Registration Rights Agreement among the Company, the Guarantors
and the Initial Purchasers, dated June 25, 1999, pursuant to which, subject to
the terms and conditions thereof, the Company and the Guarantors are obligated
to consummate the Exchange Offer pursuant to which the Holder of this Security
(and the related Guarantees) shall have the right to exchange this Security (and
the related Guarantees) for 6.34% Senior Notes due 2001, Series B and related
guarantees (herein called the "Series B Securities") in like principal amount as
provided therein. In addition, the Company and the Guarantors have agreed to use
their reasonable efforts to register the Securities for resale under the
Securities Act through a Shelf Registration Statement in the event that the
Exchange Offer is not consummated within 225 calendar days after the original
issue of
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<PAGE> 17
the Securities or under certain other circumstances. The Series A Securities and
the Series B Securities are together (including related Guarantees) referred to
as the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
In the event that (a) the Exchange Offer Registration
Statement is not filed with the Commission on or prior to the 90th calendar day
following the date of original issue of the Series A Securities, (b) the Shelf
Registration Statement is not filed with the Commission on or prior to the date
is was required to be filed in accordance with the terms of the Registration
Rights Agreement, (c) the Exchange Offer Registration Statement is not declared
effective within 180 days following the date of the original issue of the Series
A Securities, (d) a Shelf Registration Statement required to be filed is not
declared effective on or prior to 120 days after it was filed, (e) the Exchange
Offer is not consummated on or prior to the 225th calendar day following the
date of original issue of the Series A Securities, or (f) the Exchange Offer
Registration Statement or the Shelf Registration Statement is filed and declared
effective but shall thereafter either be withdrawn or become subject to an
effective stop order suspending its effectiveness (except as specifically
permitted in the Registration Rights Agreement) without being succeeded
immediately by an additional registration statement which becomes effective
(each such event referred to in clauses (a) through (f) above, a "Registration
Default"), the interest rate borne by the Series A Securities shall be increased
by one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) will increase by an additional
one-quarter of one percent each 90-day period that such additional interest
continues to accrue under any such circumstance, with an aggregate maximum
increase in the interest rate equal to one percent (1%) per annum. Immediately
following the cure of a Registration Default the accrual of additional interest
with respect to that particular Registration Default will cease.
Payment of the principal of (and premium, if any) and interest
on this Security will be made at the office or agency of the Company maintained
for that purpose in Cincinnati, Ohio, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; PROVIDED, HOWEVER, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity
date of this Security does not fall on a Business Day, payment of interest or
principal otherwise payable on such day need not be made on such day, but may be
made on the next succeeding Business Day with the same form and effect as if
made on such Interest Payment Date or the maturity date of this Security.
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<PAGE> 18
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By.........................
Attest:
....................................
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<PAGE> 19
(b) The form of the face of any Series B Securities
authenticated and delivered hereunder shall be substantially as follows:
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE KROGER CO. 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.
-16-
<PAGE> 20
THE KROGER CO.
6.34% Senior Notes due 2001, Series B
CUSIP No. _______
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing
under the laws of the State of Ohio (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on June 1, 2001, and to pay interest thereon from June 25, 1999 or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually on June 1 and December 1 in each year, commencing
December 1, 1999, at the rate of interest of 6.34% per annum until the principal
hereof is paid or made available for payment, provided that to the extent
interest has not been paid or duly provided for with respect to the Series A
Security exchanged for this Series B Security, interest on this Series B
Security shall accrue from the most recent Interest Payment Date to which
interest on the Series A Security which was exchanged for this Series B Security
has been paid or duly provided for. The interest so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the May 15 or November 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said Indenture.
This Series B Security was issued pursuant to the Exchange
Offer pursuant to which the 6.34% Senior Notes due 2001, Series A, and related
Guarantees (herein called the "Series A Securities") in like principal amount
were exchanged for the Series B Securities and related Guarantees. The Series B
Securities rank pari passu in right of payment with the Series A Securities.
For any period in which the Series A Security exchanged for
this Series B Security was outstanding, in the event that (a) the Exchange Offer
Registration Statement
-17-
<PAGE> 21
shall not have been filed with the Commission on or prior to the 90th calendar
day following the date of original issue of the Series A Securities, (b) the
Shelf Registration Statement shall not have been filed with the Commission on or
prior to the date is was required to be filed in accordance with the terms of
the Registration Rights Agreement, (c) the Exchange Offer Registration Statement
shall not have been declared effective within 180 days following the date of the
original issue of the Series A Securities, (d) a Shelf Registration Statement
required to be filed shall not have been declared effective on or prior to 120
days after it was filed, (e) the Exchange Offer shall not have been consummated
on or prior to the 225th calendar day following the date of original issue of
the Series A Securities, or (f) the Exchange Offer Registration Statement or the
Shelf Registration Statement shall have been filed and declared effective but
shall thereafter be withdrawn or become subject to an effective stop order
suspending its effectiveness (except as specifically permitted in the
Registration Rights Agreement) without being succeeded immediately by an
additional registration statement which becomes effective (each such event
referred to in clauses (a) through (f) above, a "Registration Default"), the
interest rate borne by the Series A Securities shall have increased by
one-quarter of one percent per annum upon the occurrence of any Registration
Default, which rate (as increased as aforesaid) shall have increased by an
additional one-quarter of one percent each 90-day period that such additional
interest continued to accrue under any such circumstance, with an aggregate
maximum increase in the interest rate equal to one percent (1%) per annum.
Immediately following the cure of a Registration Default the accrual of
additional interest with respect to that particular Registration Default shall
have ceased; provided, however, that, if after any such reduction in interest
rate, a different event specified in clause (a) through (e) shall have occurred,
the interest rate again shall have increased pursuant to the foregoing
provisions. To the extent that interest at such increased rate shall not have
been paid or duly provided for with respect to the Series A Security exchanged
for this Series B Security, interest on this Series B Security shall accrue at
such increased rate, from the most recent Interest Payment Date to which
interest at such increased rate on the Series A Security exchanged for this
Series B Security has been paid or duly provided for, to the date on which the
particular Registration Default shall have been cured.
Payment of the principal of (and premium, if any) and interest
on this Security will be made at the office or agency of the Company maintained
for that purpose in Cincinnati, Ohio, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; PROVIDED, HOWEVER, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity
date of this Security does not fall on a Business Day, payment of interest or
principal otherwise payable on such day need not be made on such day, but may be
made on the next
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<PAGE> 22
succeeding Business Day with the same form and effect as if made on such
Interest Payment Date or the maturity date of this Security.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By.........................
Attest:
.............................
Section 203. FORM OF REVERSE OF SECURITY.
(a) The form of the reverse of the Series A Securities shall
be substantially as follows:
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
Third Supplemental Indenture dated as of June 25, 1999 (as so supplemented,
herein called the "Indenture"), between the Company, the Guarantors named
therein and the Trustee, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Guarantors named therein, the Trustee and the Holders of the Securities and of
the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof,
limited in aggregate principal amount to $250,000,000.
-19-
<PAGE> 23
The Securities of this series will not be redeemable.
The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the
principal of all Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of 50% in aggregate principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange therefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in principal amount of the Outstanding Securities a direction inconsistent with
such request and shall have failed to institute such proceeding within 60 days;
PROVIDED, HOWEVER, that such limitations do not apply to a suit instituted by
the Holder hereof for the enforcement of payment of the principal of (and
premium, if any) or any interest on this Security on or after the respective due
dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
-20-
<PAGE> 24
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of like tenor, of a different authorized denomination, as requested by the
Holder surrendering the same.
Except where otherwise specifically provided in the Indenture,
no service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
(b) The form of the reverse of the Series B Securities shall
be substantially as follows:
This Security is one of a duly authorized issue of Securities
of the Company (herein called the "Securities") issued and to be issued under an
Indenture dated as of June 25, 1999 between the Company and Firstar Bank,
National Association, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), as supplemented by the
Third Supplemental Indenture dated as of June 25, 1999 (as so supplemented,
herein called the "Indenture"), between the Company, the Guarantors named
therein and the Trustee, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to
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<PAGE> 25
be, authenticated and delivered. This Security is one of the series designated
on the face hereof, limited in aggregate principal amount to $250,000,000.
The Securities of this series will not be redeemable.
The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the
principal of all Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of 50% in aggregate principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange therefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any remedy thereunder, unless
such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in principal amount of the Outstanding Securities a direction inconsistent with
such request and shall have failed to institute such proceeding within 60 days;
PROVIDED, HOWEVER, that such limitations do not apply to a suit instituted by
the Holder hereof for the enforcement of payment of the principal of (and
premium, if any) or any interest on this Security on or after the respective due
dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and
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<PAGE> 26
unconditional, to pay the principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of like tenor, of a different authorized denomination, as requested by the
Holder surrendering the same.
Except where otherwise specifically provided in the Indenture,
no service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Section 204. FORM OF GUARANTEE.
The form of Guarantee shall be set forth on the Securities
substantially as follows:
GUARANTEE
For value received, each of the undersigned hereby absolutely, fully
and unconditionally and irrevocably guarantees, jointly and severally with each
other Guarantor, to the holder of this Security the payment of principal of,
premium, if any, and interest on this Security upon which this Guarantee is
endorsed in the amounts and at the
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<PAGE> 27
time when due and payable whether by declaration thereof, or otherwise, and
interest on the overdue principal and interest, if any, of this Security, if
lawful, and the payment or performance of all other obligations of the Company
under the Indenture or the Securities, to the holder of this Security and the
Trustee, all in accordance with and subject to the terms and limitations of this
Security and Article Six of the Third Supplemental Indenture to the Indenture.
This Guarantee will not become effective until the Trustee duly executes the
certificate of authentication on this Security. This Guarantee shall be governed
by and construed in accordance with the laws of the State of New York, without
regard to conflict of law principles thereof.
Dated:
Attest*: The Guarantors listed on Schedule I hereto
By*:
- --------------------------- -----------------------------------
Name:
Title:
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC., as Guarantor of the Securities
By:
- --------------------------- -----------------------------------
Name:
Title:
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By:
- --------------------------- -----------------------------------
Name:
Title:
- ----------------
* Signing as duly authorized officer for each such Guarantor.
-24-
<PAGE> 28
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
By:
- --------------------------- -----------------------------------
Name:
Title:
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By:
- --------------------------- -----------------------------------
Name:
Title:
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<PAGE> 29
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
- -----------------------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
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<PAGE> 30
Name of Guarantor State of Organization
- -----------------------------------------------------------------------------
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
-27-
<PAGE> 31
Section 205. GLOBAL SECURITIES.
(a) Each Global Security initially shall (i) be registered in
the name of the Depositary for such Global Security or the nominee of such
Depositary, (ii) be deposited with, or on behalf of, the Depositary or with the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 202.
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depositary, or the Trustee as its
custodian, or under such Global Security, and the Depositary may be treated by
the Company, the Guarantors, the Trustee and any agent of the Company or the
Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Guarantors, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or shall impair, as between the Depositary and its
Agent Members, the operation of customary practices governing the exercise of
the rights of a holder of any Security.
(b) [Intentionally Omitted].
(c) If any Global Security is to be exchanged for other
Securities or canceled in whole, it shall be surrendered by or on behalf of the
Depositary or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Section 205 and the Indenture. If any Global
Security is to be exchanged for other Securities or canceled in part, or if
another Security is to be exchanged in whole or in part for a beneficial
interest in any Global Security, then either (i) such Global Security shall be
so surrendered for exchange or cancellation as provided in this Section 205 and
the Indenture or (ii) the principal amount thereof shall be reduced or increased
by an amount equal to the portion thereof to be so exchanged or canceled, or
equal to the principal amount of such other Security to be so exchanged for a
beneficial interest therein, as the case may be, by means of an appropriate
adjustment made on the records of the Trustee, as Security Registrar, whereupon
the Trustee, in accordance with the Applicable Procedures, shall instruct the
Depositary or its authorized representative to make a corresponding adjustment
to its records. Upon any such surrender or adjustment of a Global Security, the
Trustee shall, subject to this Section 205 and the Indenture, authenticate and
deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative
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<PAGE> 32
which is given or made pursuant to this Section 205 and the Indenture if such
order, direction or request is given or made in accordance with the Applicable
Procedures.
(d) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global Security
or any portion thereof, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name of a
Person other than the Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a
Global Security, shall be the Holder of such Global Security for all purposes
under the Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
ARTICLE THREE
TRANSFER AND EXCHANGE
Section 301. TRANSFER AND EXCHANGE.
(a) CERTAIN TRANSFERS AND EXCHANGES. Transfers and exchanges
of Securities and beneficial interests in a Global Security of the kinds
specified in this Section 301 shall be made only in accordance with this Section
301.
(i) RULE 144A GLOBAL SECURITY TO REGULATION S GLOBAL
SECURITY. If the owner of a beneficial interest in the Rule
144A Global Security wishes at any time to transfer such
interest to a Person who wishes to acquire the same in the
form of a beneficial interest in the Regulation S Global
Security, such transfer may be effected only in accordance
with the provisions of this paragraph and paragraph (iv) below
and subject to the Applicable Procedures. Upon receipt by the
Trustee, as Security Registrar, of (a) an order given by the
Depositary or its authorized representative directing that a
beneficial interest in the Regulation S Global Security in a
specified principal amount be credited to a specified Agent
Member's account and that a beneficial interest in the Rule
144A Global Security in an equal principal amount be debited
from another specified Agent Member's account and (b) a
Regulation S Certificate in the form of Exhibit A hereto,
satisfactory to the Trustee and duly executed by the owner of
such beneficial interest in the Rule 144A Global Security or
his attorney duly authorized in writing, then the Trustee, as
Security Registrar but subject to paragraph (iv) below, shall
reduce the principal amount of the
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<PAGE> 33
Rule 144A Global Security and increase the principal amount of
the Regulation S Global Security by such specified principal
amount as provided in Section 205(c).
(ii) REGULATION S GLOBAL SECURITY TO RULE 144A GLOBAL
SECURITY. If the owner of a beneficial interest in the
Regulation S Global Security wishes at any time to transfer
such interest to a Person who wishes to acquire the same in
the form of a beneficial interest in the Rule 144A Global
Security, such transfer may be effected only in accordance
with this paragraph (ii) and subject to the Applicable
Procedures. Upon receipt by the Trustee, as Security
Registrar, of (a) an order given by the Depositary or its
authorized representative directing that a beneficial interest
in the Rule 144A Global Security in a specified principal
amount be credited to a specified Agent Member's account and
that a beneficial interest in the Regulation S Global Security
in an equal principal amount be debited from another specified
Agent Member's account and (b) if such transfer is to occur
during the Restricted Period, a Restricted Securities
Certificate in the form of Exhibit B hereto, satisfactory to
the Trustee and duly executed by the owner of such beneficial
interest in the Regulation S Global Security or his attorney
duly authorized in writing, then the Trustee, as Security
Registrar, shall reduce the principal amount of the Regulation
S Global Security and increase the principal amount of the
Rule 144A Global Security by such specified principal amount
as provided in Section 205(c).
(iii) EXCHANGES BETWEEN GLOBAL SECURITY AND
NON-GLOBAL SECURITY. A beneficial interest in a Global
Security may be exchanged for a Security that is not a Global
Security as provided in Section 301(b), PROVIDED that, if such
interest is a beneficial interest in the Rule 144A Global
Security, or if such interest is a beneficial interest in the
Regulation S Global Security and such exchange is to occur
during the Restricted Period, then such interest shall bear
the appropriate Private Placement Legend (subject in each case
to Section 301(b). Securities which are not in global form may
not be exchanged for beneficial interests in any global note
unless the transferor first delivers to the trustee a written
certificate to the effect that the transfer will comply with
the appropriate transfer restrictions applicable to those
securities.
(iv) REGULATION S GLOBAL SECURITY TO BE HELD THROUGH
EUROCLEAR OR CEDEL DURING RESTRICTED PERIOD. The Company shall
use its reasonable efforts to cause the Depositary to ensure
that, until the expiration of the Restricted Period,
beneficial interests in the Regulation S Global Security may
be held only in or through accounts maintained at the
Depositary by Euroclear or Cedel (or by Agent Members acting
for the account thereof),
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<PAGE> 34
and no person shall be entitled to effect any transfer or
exchange that would result in any such interest being held
otherwise than in or through such an account; PROVIDED that
this paragraph (iv) shall not prohibit any transfer or
exchange of such an interest in accordance with paragraph (ii)
above.
(b) PRIVATE PLACEMENT LEGENDS. Rule 144A Securities and their
Successor Securities and Regulation S Securities and their Successor Securities
shall bear a Private Placement Legend, subject to the following:
(i) subject to the following clauses of this Section
301(b), a Security or any portion thereof which is exchanged,
upon transfer or otherwise, for a Global Security or any
portion thereof shall bear the Private Placement Legend borne
by such Global Security while represented thereby;
(ii) subject to the following Clauses of this Section
301(b), a new Security which is not a Global Security and is
issued in exchange for another Security (including a Global
Security) or any portion thereof, upon transfer or otherwise,
shall bear the Private Placement Legend borne by such other
Security;
(iii) Exchange Securities, and all other Securities
sold or otherwise disposed of pursuant to an effective
registration statement under the Securities Act, together with
their respective Successor Securities, shall not bear a
Private Placement Legend;
(iv) at any time after the Securities may be freely
transferred without registration under the Securities Act or
without being subject to transfer restrictions pursuant to the
Securities Act, a new Security which does not bear a Private
Placement Legend may be issued in exchange for or in lieu of a
Security (other than a Global Security) or any portion thereof
which bears such a legend if the Trustee has received an
Unrestricted Securities Certificate substantially in the form
of Exhibit C hereto, satisfactory to the Trustee and duly
executed by the Holder of such legended Security or his
attorney duly authorized in writing, and after such date and
receipt of such certificate, the Trustee shall authenticate
and deliver such a new Security in exchange for or in lieu of
such other Security as provided in this Section 301 and the
Indenture;
(v) a new Security which does not bear a Private
Placement Legend may be issued in exchange for or in lieu of a
Security (other than a Global Security) or any portion thereof
which bears such a legend if, in the Company's judgment,
placing such a legend upon such new Security is not necessary
to ensure compliance with the registration requirements of the
Securities Act, and the Trustee, at the direction of the
Company, shall
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authenticate and deliver such a new Security as provided in
this Section 301 and the Indenture; and
(vi) notwithstanding the foregoing provisions of this
Section 301(b), a Successor Security of a Security that does
not bear a particular form of Private Placement Legend shall
not bear such form of legend unless the Company has reasonable
cause to believe that such Successor Security is a "restricted
security" within the meaning of Rule 144, in which case the
Trustee, at the direction of the Company, shall authenticate
and deliver a new Security bearing a Private Placement Legend
in exchange for such Successor Security as provided in this
Section 301 and the Indenture.
By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Security Registrar shall retain copies of all letters,
notices and other written communications received pursuant to Section 205 or
this Section 301. The Company shall have the right to inspect and make copies of
all such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Security Registrar.
ARTICLE FOUR
THE SERIES OF SECURITIES
Section 401. TITLE AND TERMS.
There shall be a series of securities designated as the "6.34%
Senior Notes due 2001, Series A" of the Company (the "Series A Securities" or
the "Initial Securities") and a series of securities designated as the "6.34%
Senior Notes due 2001, Series B" of the Company (the "Series B Securities" and,
together with the Series A Securities, the "Securities"). The Stated Maturity of
the Securities shall be June 1, 2001, and they shall bear interest at the rate
of 6.34% per annum, subject to increase as set forth in the Registration Rights
Agreement.
Interest on the Securities of this series will be payable
semi-annually on June 1 and December 1 of each year, commencing December 1,
1999, until the principal thereof is made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will be paid to the Person in whose name the Securities of this series (or one
or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the May 15
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or November 15 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date.
In the case where any Interest Payment Date or the maturity
date of the Securities of this series does not fall on a Business Day, payment
of interest or principal otherwise payable on such date need not be made on such
day, but may be made on the next succeeding Business Day with the same force and
effect as if made on such Interest Payment Date or the maturity date of the
Securities of this series.
The aggregate principal amount of Securities of this series
which may be authenticated and delivered under this Third Supplemental Indenture
is limited to $250,000,000, except for Securities authenticated and delivered
upon registration or transfer of, or in exchange for, or in lieu of, other
Securities of this series pursuant to Section 304, 305 and 306 of the Indenture
and except for any Securities of this series which, pursuant to Section 303 of
the Indenture, are deemed never to have been authenticated and delivered under
the Indenture.
The Securities of this series will be represented by one or
more Global Securities representing the entire $250,000,000 aggregate principal
amount of the Securities of this series, and the Depositary with respect to such
Global Security or Global Securities will be The Depository Trust Company.
The Place of Payment for the principal of (and premium, if
any) and interest on the Securities of this series shall be the office or agency
of the Company in the City of Cincinnati, State of Ohio, maintained for such
purpose, which shall be the Corporate Trust Office of the Trustee and at any
other office or agency maintained by the Company for such purpose; PROVIDED,
HOWEVER, that at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.
The Securities of this series are redeemable prior to maturity
at the option of the Company as provided in this Third Supplemental Indenture.
The Securities of this series are not subject to a sinking
fund and the provisions of Section 501(3) and Article Twelve of the Indenture
shall not be applicable to the Securities of this series.
The Securities of this series are subject to defeasance at the
option of the Company as provided in this Third Supplemental Indenture.
For all purposes hereunder, the Series A Securities and the
Series B Securities will be treated as one class and are together referred to as
the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
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ARTICLE FIVE
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 501. MODIFICATIONS TO THE CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE PROVISIONS.
With respect to the Securities of this series, Section 801 of
the Indenture shall be deleted in its entirety and the following shall be
substituted therefor:
"Section 801. Covenant Not to Merge, Consolidate, Sell or
Convey PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge with or into or
consolidate with any corporation, partnership, or other entity
or sell, lease or convey all or substantially all of its
assets to any other Person, unless (i) either the Company
shall be the continuing corporation, or the successor entity
or the Person which acquires by sale, lease or conveyance all
or substantially all the assets of the Company (if other than
the Company) shall be a corporation or partnership organized
under the laws of the United States of America or any State
thereof or the District of Columbia and shall expressly assume
all obligations of the Company under this Indenture and the
Securities of the series created by the Third Supplemental
Indenture, including the due and punctual payment of the
principal of and interest on all the Securities of the series
created by the Third Supplemental Indenture according to their
tenor, and the due and punctual performance and observance of
all of the covenants and conditions of the Indenture to be
performed or observed by the Company, by supplemental
indenture in form satisfactory to the Trustee, executed and
delivered to the Trustee by such entity, and (ii) the Company,
such person or such successor entity, as the case may be,
shall not, immediately after such merger or consolidation, or
such sale, lease or conveyance, be in default in the
performance of any such covenant or condition and, immediately
after giving effect to such transaction, no Event of Default,
and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have happened and be
continuing.
Section 802. SUCCESSOR SUBSTITUTED
Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any sale, lease or
conveyance of
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all or substantially all of the assets of the Company in
accordance with Section 801, the successor Person formed by
such consolidation or into which the Company is merged or to
which such sale, lease or conveyance is made shall succeed to,
and be substituted for, and may exercise every right and power
of, the Company under this Indenture with the same effect as
if such successor Person had been named as the Company herein,
and thereafter, except in the case of a lease, the predecessor
Person shall be relieved of all obligations and covenants
under this Indenture and the Securities."
Section 502. OTHER MODIFICATIONS.
With respect to the Securities of this series, the Indenture
shall be modified as follows:
(a) The eighth paragraph of Section 305 of the Indenture shall
be modified by inserting ", and a successor Depositary is not appointed by the
Company within 90 days" at the end of clause (i) in such paragraph; and
(b) Section 401 of the Indenture shall be modified by adding
to the end of such Section the following paragraph:
"For the purpose of this Section 401, trust funds may consist
of (A) money in an amount, or (B) U.S. Government Obligations
(as defined in Section 1304) which through the scheduled
payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one
day before the due date of any payment, money in an amount, or
(C) a combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, to pay and discharge, the principal of, premium, if
any, and each installment of interest on the Securities of
this series on the Stated Maturity of such principal or
installment of interest on the day on which such payments are
due and payable in accordance with the terms of this Indenture
and of such Securities of this series."
Section 503. ADDITIONAL COVENANTS; DEFEASANCE AND COVENANT DEFEASANCE.
(a) With respect to the Securities of this series, the
following provisions shall be added as Sections 1009 and 1010 and as Article
Thirteen (Section references contained in these additional provisions are to the
Indenture as supplemented by this Third Supplemental Indenture):
"Section 1009. LIMITATIONS ON LIENS.
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After the date hereof and so long as any Securities of the
series created by the Third Supplemental Indenture are
Outstanding, the Company will not issue, assume or guarantee,
and will not permit any Restricted Subsidiary to issue, assume
or guarantee, any Indebtedness which is secured by a mortgage,
pledge, security interest, lien or encumbrance of any kind
(including any conditional sale or other title retention
agreement, any lease in the nature thereof, and any agreement
to give any of the foregoing) (each being hereinafter referred
to as a "lien" or "liens") of or upon any Operating Property
or Operating Asset, whether now owned or hereafter acquired,
of the Company or any Restricted Subsidiary without
effectively providing that the Securities of the series
created by the Third Supplemental Indenture (together with, if
the Company shall so determine, any other Indebtedness of the
Company ranking equally with the Securities) shall be equally
and ratably secured by a lien on such assets ranking ratably
with and equal to (or at the Company's option prior to) such
secured Indebtedness; provided that the foregoing restriction
shall not apply to:
(a) liens on any property or assets of any corporation
existing at the time such corporation becomes a Restricted
Subsidiary provided that such lien does not extend to any
other property of the Company or any of its Restricted
Subsidiaries;
(b) liens on any property or assets (including stock) existing
at the time of acquisition of such property or assets by the
Company or a Restricted Subsidiary, or liens to secure the
payment of all or any part of the purchase price of such
property or assets (including stock) upon the acquisition of
such property or assets by the Company or a Restricted
Subsidiary or to secure any indebtedness incurred, assumed or
guaranteed by the Company or a Restricted Subsidiary for the
purpose of financing all or any part of the purchase price of
such property or, in the case of real property, construction
or improvements thereon or attaching to property substituted
by the Company to obtain the release of a lien on other
property of the Company on which a lien then exists, which
indebtedness is incurred, assumed or guaranteed prior to, at
the time of, or within 18 months after such acquisition (or in
the case of real property, the completion of construction
(including any improvements on an existing asset) or
commencement of full operation at such property, whichever is
later (which in the case of a retail store is the opening of
the store for business to the public)); provided that in the
case of any such acquisition, construction or improvement, the
lien shall not apply to any other property or assets
theretofore owned by the Company or a Restricted Subsidiary;
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(c) liens on any property or assets to secure Indebtedness of
a Restricted Subsidiary to the Company or to another
Restricted Subsidiary;
(d) liens on any property or assets of a corporation existing
at the time such corporation is merged into or consolidated
with the Company or a Restricted Subsidiary or at the time of
a purchase, lease or other acquisition of the assets of a
corporation or firm as an entirety or substantially as an
entirety by the Company or a Restricted Subsidiary provided
that such lien does not extend to any other property of the
Company or any of its Restricted Subsidiaries;
(e) liens on any property or assets of the Company or a
Restricted Subsidiary in favor of the United States of America
or any State thereof, or any department, agency or
instrumentality or political subdivision of the United States
of America or any State thereof, or in favor of any other
country, or any political subdivision thereof, to secure
partial, progress, advance or other payments pursuant to any
contract or statute or to secure any Indebtedness incurred or
guaranteed for the purpose of financing all or any part of the
purchase price (or, in the case of real property, the cost of
construction) of the property or assets subject to such liens
(including, but not limited to, liens incurred in connection
with pollution control, industrial revenue or similar
financings);
(f) liens existing on properties or assets of the Company or
any Restricted Subsidiary existing on the date hereof;
provided that such liens secure only those obligations which
they secure on the date hereof or any extension, renewal or
replacement thereof;
(g) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part, of
any lien referred to in the foregoing clauses (a) through (f),
inclusive; provided that such extension, renewal or
replacement shall be limited to all or a part of the property
or assets which secured the lien so extended, renewed or
replaced (plus improvements and construction on real
property);
(h) liens imposed by law, such as mechanics', workmen's,
repairmen's, materialmen's, carriers', warehouseman's,
vendors', or other similar liens arising in the ordinary
course of business of the Company or a Restricted Subsidiary,
or governmental (federal, state or municipal) liens arising
out of contracts for the sale of products or services by the
Company or any Restricted Subsidiary, or deposits or pledges
to obtain the release of any of the foregoing liens;
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(i) pledges, liens or deposits under worker's compensation
laws or similar legislation and liens or judgments thereunder
which are not currently dischargeable, or in connection with
bids, tenders, contracts (other than for the payment of money)
or leases to which the Company or any Restricted Subsidiary is
a party, or to secure the public or statutory obligations of
the Company or any Restricted Subsidiary, or in connection
with obtaining or maintaining self-insurance or to obtain the
benefits of any law, regulation or arrangement pertaining to
unemployment insurance, old age pensions, social security or
similar matters, or to secure surety, appeal or customs bonds
to which the Company or any Restricted Subsidiary is a party,
or in litigation or other proceedings such as, but not limited
to, interpleader proceedings, and other similar pledges, liens
or deposits made or incurred in the ordinary course of
business;
(j) liens created by or resulting from any litigation or other
proceeding which is being contested in good faith by
appropriate proceedings, including liens arising out of
judgments or awards against the Company or any Restricted
Subsidiary with respect to which the Company or such
Restricted Subsidiary is in good faith prosecuting an appeal
or proceedings for review or for which the time to make an
appeal has not yet expired; or final unappealable judgment
liens which are satisfied within 30 days of the date of
judgment; or liens incurred by the Company or any Restricted
Subsidiary for the purpose of obtaining a stay or discharge in
the course of any litigation or other proceeding to which the
Company or such Restricted Subsidiary is a party;
(k) liens for taxes or assessments or governmental charges or
levies not yet due or delinquent, or which can thereafter be
paid without penalty, or which are being contested in good
faith by appropriate proceedings; landlord's liens on property
held under lease; and any other liens or charges incidental to
the conduct of the business of the Company or any Restricted
Subsidiary or the ownership of the property or assets of any
of them which were not incurred in connection with the
borrowing of money or the obtaining of advances or credit and
which do not, in the opinion of the Company, materially impair
the use of such property or assets in the operation of the
business of the Company or such Restricted Subsidiary or the
value of such property or assets for the purposes of such
business; or
(l) liens not permitted by clauses (a) through (k) above if at
the time of, and after giving effect to, the creation or
assumption of any such lien, the aggregate amount of all
Indebtedness of the Company and its Restricted Subsidiaries
secured by all such liens not so permitted by clauses (a)
through (k) above together with the Attributable Debt in
respect of Sale and
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Lease-Back Transactions permitted by paragraph (a) of Section
1010 does not exceed 10% of Consolidated Net Tangible Assets.
Section 1010. LIMITATIONS ON SALE AND LEASE-BACK TRANSACTIONS.
After the date hereof and so long as any Securities of the
series created by the Third Supplemental Indenture are
Outstanding, the Company agrees that it will not, and will not
permit any Restricted Subsidiary to, enter into any
arrangement with any Person providing for the leasing by the
Company or a Restricted Subsidiary of any Operating Property
or Operating Asset (other than any such arrangement involving
a lease for a term, including renewal rights, for not more
than 3 years and leases between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries), whereby such
Operating Property or Operating Asset has been or is to be
sold or transferred by the Company or any Restricted
Subsidiary to such Person (herein referred to as a "Sale and
Lease-Back Transaction"), unless:
(a) the Company or such Restricted Subsidiary would, at
the time of entering into a Sale and Lease-Back transaction,
be entitled to incur Indebtedness secured by a lien on the
Operating Property or Operating Asset to be leased in an
amount at least equal to the Attributable Debt in respect of
such Sale and Lease-Back Transaction without equally and
ratably securing the Securities of the series created by the
Third Supplemental Indenture pursuant to Section 1009; or
(b) the proceeds of the sale of the Operating Property
or Operating Asset to be leased are at least equal to the fair
market value of such Operating Property or Operating Asset (as
determined by the chief financial officer or chief accounting
officer of the Company) and an amount in cash equal to the net
proceeds from the sale of the Operating Property or Operating
Asset so leased is applied, within 180 days of the effective
date of any such Sale and Lease-Back Transaction, to the
purchase or acquisition (or, in the case of Operating
Property, the construction) of Operating Property or Operating
Assets or to the retirement, repurchase, redemption or
repayment (other than at maturity or pursuant to a mandatory
sinking fund or redemption provision and other than
Indebtedness owned by the Company or any Restricted
Subsidiary) of Securities of the series created by the Third
Supplemental Indenture or of Funded Indebtedness of the
Company ranking on a parity with or senior to the Securities
of the series created by the Third Supplemental Indenture, or
in the case of a Sale and Lease-Back Transaction by a
Restricted Subsidiary, of Funded Indebtedness of such
Restricted Subsidiary; provided that in connection with any
such
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retirement, any related loan commitment or the like shall be
reduced in an amount equal to the principal amount so retired.
The foregoing restriction shall not apply
to, in the case of any Operating Property or Operating Asset
acquired or constructed subsequent to the date eighteen months
prior to the date of this Indenture, any Sale and Lease-Back
Transaction with respect to such Operating Asset or Operating
Property (including presently owned real property upon which
such Operating Property is to be constructed) if a binding
commitment is entered into with respect to such Sale and
Lease-Back Transaction within 18 months after the later of the
acquisition of the Operating Property or Operating Asset or
the completion of improvements or construction thereon or
commencement of full operations at such Operating Property
(which in the case of a retail store is the opening of the
store for business to the public).
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
Section 1301. COMPANY'S OPTION TO EFFECT DEFEASANCE OR
COVENANT DEFEASANCE.
The Company may at its option by Board Resolution, at any
time, elect to have either Section 1302 or Section 1303 applied to the
Outstanding Securities of this series upon compliance with the
conditions set forth below in this Article Thirteen.
Section 1302. DEFEASANCE AND DISCHARGE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be deemed to have
been discharged from its obligations with respect to the Outstanding
Securities of the series created by the Third Supplemental Indenture on
the date the conditions set forth below are satisfied (hereinafter,
"Defeasance"). For this purpose, such Defeasance means that the Company
shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities of this series and to have
satisfied all its other obligations under such Securities of this
series and this Indenture insofar as such Securities of this series are
concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of Outstanding Securities of this
series to receive, solely from the trust fund described in Section 1304
and as more fully set forth in such Section, payments in respect of the
principal of (and
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premium, if any) and interest on such securities when such payments are
due, (B) the Company's obligations with respect to such Securities of
this series under Sections 304, 305, 306, 1002 and 1003, (C) the
rights, powers, trusts, duties and immunities of the Trustee hereunder
and (D) this Article Thirteen. Subject to compliance with this Article
Thirteen, the Company may exercise its option under this Section 1302
notwithstanding the prior exercise of its option under Section 1303.
Section 1303. COVENANT DEFEASANCE.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be released from its
obligations under Section 501(4) (in respect of the covenants in
Sections 1008 through 1010), Section 801 and Sections 1008 through
1010, the Securities of this series and the Holders of Securities of
this series, on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant Defeasance"). For this purpose, such
covenant Defeasance means that the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation
set forth in any such Section, whether directly or indirectly, by
reason of any reference elsewhere herein to any such Section or by
reason of any reference in any such Section to any other provision
herein or in any other document, but the remainder of this Indenture
and such Securities of this series shall be unaffected thereby.
Section 1304. CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to application of either
Section 1302 or Section 1303 to the Outstanding Securities of this
series:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 609 who shall agree to
comply with the provisions of this Article Thirteen applicable
to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such
Securities of this series, (A) money in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (C) a
combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
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Trustee, to pay and discharge, and which shall be applied by
the Trustee (or other qualifying trustee) to pay and
discharge, the principal of, premium, if any, and each
installment of interest on the Securities of this series on
the Stated Maturity of such principal or installment of
interest on the day on which such payments are due and payable
in accordance with the terms of this Indenture and of such
Securities of this series. For this purpose, "U.S. Government
Obligations" means securities that are (x) direct obligations
of the United States of America for the payment of which its
full faith and credit is pledged or (y) obligations of a
Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the payment of
which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the
Company thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the
Securities Act of 1933, as amended) as custodian with respect
to any such U.S. Government Obligation or a specific payment
of principal of or interest on any such U.S. Government
Obligation held by such custodian for the account of the
holder of such depository receipt, PROVIDED that (except as
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such
depositary receipt from any amount received by the custodian
in respect of the U.S. Government Obligation or the specific
payment of principal of or interest on the U.S. Government
Obligation evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or
lapse of time or both would become an Event of Default shall
have occurred and be continuing on the date of such deposit
or, insofar as subsections 501(6) and (7) are concerned, at
any time during the period ending on the 121st day after the
date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such
period).
(3) Such Defeasance or covenant Defeasance shall not
cause the Trustee to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with
respect to any securities of the Company.
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(4) Such Defeasance or covenant Defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound.
(5) The Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to
either the Defeasance under Section 1302 or the covenant
Defeasance under Section 1303 (as the case may be) have been
complied with.
(6) In the case of an election under Section 1302,
the Company shall have delivered to the Trustee an Opinion of
Counsel stating that (x) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling, or (y) since the date of this Third Supplemental
Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that and based
thereon such opinion shall confirm that, the Holders of the
Outstanding Securities of this series will not recognize
income, gain or loss for Federal income tax purposes as a
result of such Defeasance or covenant Defeasance and will be
subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if
such Defeasance or covenant Defeasance had not occurred."
Section 1305. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS
TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying
trustee--collectively, for purposes of this Section 1305, the
"Trustee") pursuant to Section 1304 in respect of the Securities of
this series shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities of this series and
this Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Securities of this
series, of all sums due and to become due thereon in respect of
principal (and premium, if any) and interest, but such money need not
be segregated from other funds except to the extent required by law.
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The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 1304 or the
principal and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders
of the Outstanding Securities of this series.
Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from
time to time upon Company Request any money or U.S. Government
Obligations held by it as provided in Section 1304 which, in the
opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent Defeasance or covenant
Defeasance.
Section 1306. REINSTATEMENT.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 1302 or 1303 by reason of any order or
judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Securities of this series
shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Thirteen until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with
Section 1302 or 1303; PROVIDED, HOWEVER, that if the Company makes any
payment of principal of (and premium, if any) or interest on any
Security of this series following the reinstatement of its obligations,
the Company shall be subjugated to the rights of the Holders of such
Securities of this series to receive such payment from the money held
by the Trustee or the Paying Agent.
Section 504. REDEMPTION OF SECURITIES.
With respect to Securities of this series, Article 11 of the
Indenture shall be deleted in its entirety and shall be
replaced with the statement "[Intentionally Omitted]."
ARTICLE SIX
GUARANTEE
Section 601. GUARANTEE.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the
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<PAGE> 48
validity and enforceability of the Indenture or the Securities or the
obligations of the Company or any other Guarantor to the Holders or the Trustee
hereunder or thereunder, that (a) the principal of, premium, if any, and
interest on the Securities will be duly and punctually paid in full when due,
whether at maturity, upon redemption, by acceleration or otherwise, and interest
on the overdue principal and (to the extent permitted by law) interest, if any,
on the Securities and all other obligations of the Company or the Guarantor to
the Holders of or the Trustee under the Indenture or the Securities hereunder
(including fees, expenses or others) (collectively, the "Obligations") will be
promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Obligations, the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal,
whether at Stated Maturity, by acceleration or otherwise. If the Company shall
fail to pay when due, or to perform, any Obligations, for whatever reason, each
Guarantor shall be obligated to pay, or to perform or cause the performance of,
the same immediately. An Event of Default under the Indenture or the Securities
shall constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Obligations of the Guarantor hereunder
in the same manner and to the same extent as the Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Obligations may be accelerated as provided in Article Five of
the Indenture for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Obligations, and (b) in the event of any acceleration of such Obligations as
provided in Article Five of the Indenture, such Obligations (whether or not due
and payable) shall forthwith become due and payable by the Guarantor for the
purposes of its Guarantee.
Section 602. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Obligations, and also waives notice of acceptance of its Guarantee and
notice of protest for nonpayment.
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Section 603. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee
constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Obligations.
Section 604. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 610 of this Third Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Obligations), including any claim of
waiver, release, surrender, alteration or compromise of any of the Obligations,
and shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each of the Guarantors hereunder
shall not be discharged or impaired or otherwise affected by the failure of the
Trustee or any Holder of the Securities to assert any claim or demand or to
enforce any remedy under the Indenture or the Securities, any other guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or omission that may or
might in any manner or to any extent vary the risk of any Guarantor or that
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the
Obligations).
Section 605. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Obligations or any
part thereof from any cause, or the cessation from any cause of the liability of
the Company, other than final and indefeasible payment in full in cash of the
Obligations. Each of the Guarantors waives any defense arising out of any such
election even though such election operates to impair or to extinguish any right
of reimbursement or subrogation or other right or remedy of each of the
Guarantors against the Company or any security.
Section 606. CONTINUED EFFECTIVENESS.
Subject to Section 610 of this Third Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Obligation is
rescinded or must otherwise be restored by the Trustee or any Holder of the
Securities upon the bankruptcy or reorganization of the Company.
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<PAGE> 50
Section 607. SUBROGATION.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Obligations, and thereupon the
Holders shall, assign (except to the extent that such assignment would render a
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Obligations
owed to it and paid by such Guarantor pursuant to this Guarantee to such
Guarantor, such assignment to be PRO RATA to the extent the Obligations in
question were discharged by such Guarantor, or make such other disposition
thereof as such Guarantor shall direct (all without recourse to the Holders, and
without any representation or warranty by the Holders). If (a) a Guarantor shall
make payment to the Holders of all or any part of the Obligations and (b) all
the Obligations and all other amounts payable under this Third Supplemental
Indenture shall be indefeasibly paid in full, the Trustee will, at such
Guarantor's request, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Obligations resulting from such payment by such Guarantor.
Section 608. INFORMATION.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 609. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Obligations to the Trustee;
PROVIDED, HOWEVER, that any right of subrogation that such Guarantor may have
pursuant to this Third Supplemental Indenture is subject to Section 607 hereof.
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<PAGE> 51
Section 610. TERMINATION.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Third Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Service and Standard and Poor's Rating
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged from
its obligations under this Third Supplemental Indenture and its Guarantee if,
upon consummation of such sale, exchange, transfer or other disposition (by
merger or otherwise), such Guarantor remains or becomes a guarantor under any
Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Third Supplemental Indenture and its
Guarantee.
Section 611. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such guarantor, provisions similar to those set forth in Section
610 hereof.
Section 612. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become a Guarantor under this Third Supplemental Indenture, if it has not
already done so or unless the Guarantor is
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prohibited from doing so by applicable law or a provision of a contract to which
it is a party or by which it is bound.
Section 613. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
by such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Title 11 of the United States Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal of
state law. To effectuate the foregoing intention, the Holders and such Guarantor
hereby irrevocably agree that the obligations of such Guarantor under this Third
Supplemental Indenture and its Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of, any other Guarantor in respect of the obligations of such
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Third Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
Section 614. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 615. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Obligations or against the Company or any
other Person or any property of the Company or any other Person before the
Trustee, such Holder or such other Person is entitled to demand payment and
performance by any or all Guarantors of their liabilities and obligations under
their Guarantee.
Section 616. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
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<PAGE> 53
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Obligations as the Holders may see fit or
change any such application in whole or in part from time to time as the Holders
may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 617. EXECUTION AND DELIVERY OF THE GUARANTEE.
(a) To further evidence the Guarantee set forth in this
Article Six, each Guarantor hereby agrees that a notation of such Guarantee
shall be endorsed on each Security authenticated and delivered by the Trustee
and executed by either manual or facsimile signature of an officer of each
Guarantor. The corporate seal of a Guarantor may be reproduced on the executed
Guarantee and the execution thereof may be attested to by any appropriate
officer of the Guarantor, but neither such reproduction nor such attestation is
or shall be required.
(b) Each of the Guarantors hereby agrees that its Guarantee
set forth in this Article Six shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such
Guarantee.
(c) If an officer of a Guarantor whose signature is on this
Third Supplemental Indenture or a Guarantee no longer holds that office at the
time the Trustee authenticates such Guarantee or at any time thereafter, such
Guarantor's Guarantee of such Security shall be valid nevertheless.
(d) The delivery of any Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of any Guarantee
set forth in this Third Supplemental Indenture on behalf of each Guarantor.
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ARTICLE SEVEN
MISCELLANEOUS
Section 701. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Third Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Third Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Third Supplemental Indenture.
(c) All capitalized terms used and not defined herein shall
have the respective meanings assigned to them in the Indenture.
(d) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Third Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
(e) All covenants and agreements in this Third Supplemental
Indenture by the Company, the Trustee and each Guarantor shall bind its
respective successors and assigns, whether so expressed or not.
(f) In case any provisions in this Third Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(g) Nothing in this Third Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(h) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Third
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Third
Supplemental Indenture as so modified or excluded, as the case may be.
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(i) This Third Supplemental Indenture shall be governed by and
construed in accordance with the laws of the State of New York.
(j) All amendments to the Indenture made hereby shall have
effect only with respect to the series of Securities created hereby.
(k) All provisions of this Third Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Third Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE> 56
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- --------------------------- ----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By* : /s/ Paul Heldman
- --------------------------- ----------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- --------------------------- ----------------------------------------
Name: Bruce Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ Bruce M. Gack By: /s/ Paul Heldman
- --------------------------- ----------------------------------------
Secretary Name: Paul Heldman
Title: President
- -----------------
* Signing as duly authorized officer for each such Guarantor.
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<PAGE> 57
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /S/ KEITH C. LARSON
- --------------------------- ----------------------------------------
Name: Keith C. Larson
Title: Vice President Secretary
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<PAGE> 58
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve Mcmillan
- --------------------------- ----------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 59
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ WILLIAM SICKING
- --------------------------- ----------------------------------------
Assistant Secretary Name: William Sicking
Title: Trust Officer
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<PAGE> 60
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and President of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
----------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------
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<PAGE> 61
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
----------------------------
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<PAGE> 62
STATE OF __________ )
) ss.:
COUNTY OF ________ )
On the day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
----------------------------
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<PAGE> 63
EXHIBIT A
REGULATION S CERTIFICATE
(For transfers pursuant to Section 301(a)(i) of the Indenture)
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 6.34% Securities due 2001
Reference is hereby made to the Indenture, dated as of June
25, 1999 as amended by the Third Supplemental Indenture, dated as of June 25,
1999 (collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to
a person (the "Transferee") who will take delivery in the form of a Regulation S
Global Security. In connection with such transfer, the Owner hereby certifies
that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 904 or Rule 144 under the Securities Act and with all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) RULE 904 TRANSFERS. If the transfer is being
effected in
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<PAGE> 64
accordance with Rule 904:
(A) the Owner is not a distributor of the
Securities, an affiliate of the Company or any such
distributor or a person acting on behalf of any of
the foregoing;
(B) the offer of the Specified Securities
was not made to a person in the United States;
(C) either:
(i) at the time the buy order was
originated, the Transferee was outside the
United States or the Owner and any person
acting on its behalf reasonably believed
that the Transferee was outside the United
States, or
(ii) the transaction is being executed
in, on or through the facilities of the
Eurobond market, as regulated by the
Association of International Bond Dealers,
or another designated offshore securities
market and neither the Owner nor any person
acting on its behalf knows that the
transaction has been prearranged with a
buyer in the United States;
(D) no directed selling efforts have been
made in the United States by or on behalf of the
Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities
or has received a selling concession, fee or other
remuneration in respect of the Specified Securities,
and the transfer is to occur during the Restricted
Period, then the requirements of Rule 904(c)(1) have
been satisfied;
(F) the transaction is not part of a plan or
scheme to evade the registration requirements of the
Securities Act; and
(G) if the transfer occurs during the
Restricted Period, the interest transferred will be
held immediately through Euroclear or Cedel.
(2) RULE 144 TRANSFERS. If the transfer is being
effected pursuant to Rule 144:
(A) the transfer is occurring after a
holding period of at
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<PAGE> 65
least one year (computed in accordance with paragraph
(d) of Rule 144) has elapsed since the Specified
Securities were last acquired from the Company or
from an affiliate of the Company, whichever is later,
and is being effected in accordance with the
applicable amount, manner of sale and notice
requirements of Rule 144; or
(B) the transfer is occurring after a
holding period of at least two years has elapsed
since the Specified Securities were last acquired
from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during
the preceding three months has not been, an affiliate
of the Company.
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<PAGE> 66
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
By:
----------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of the
person signing on behalf of the Undersigned
must be stated.)
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<PAGE> 67
EXHIBIT B
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to Section 301(a)(ii) of the Indenture)
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 6.34% Securities due 2001
Reference is hereby made to the Indenture, dated as of June
25, 1999 as amended by the Third Supplemental Indenture, dated as of June 25,
1999 (collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company")"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s).
ISIN No(s). If any. ____________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
The Specified Securities are represented by a Global Security and are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to
a person (the "Transferee") who will take delivery in the form of a Restricted
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant to an effective registration
statement under the Securities Act, it is being effected in accordance with Rule
144A or Rule 144 under the Securities Act and all applicable securities laws of
the states of the United States and other jurisdictions. Accordingly, the Owner
hereby further certifies as follows:
(1) RULE 144A TRANSFERS. If the transfer is being
effected in accordance with Rule 144A:
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<PAGE> 68
(A) the Specified Securities are being
transferred to a person that the Owner and any person
acting on its behalf reasonably believe is a
"qualified institutional buyer" within the meaning of
Rule 144A, acquiring for its own account or for the
account of a qualified institutional buyer; and
(B) the Owner and any person acting on its
behalf have taken reasonable steps to ensure that the
Transferee is aware that the Owner may be relying on
Rule 144A in connection with the transfer; and
(2) RULE 144 TRANSFERS. If the transfer is being
effected pursuant to Rule 144:
(A) the transfer is occurring after a
holding period of at least one year (computed in
accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last
acquired from the Company or from an affiliate of the
Company, whichever is later, and is being effected in
accordance with the applicable amount, manner of sale
and notice requirements of Rule 144; or
(B) the transfer is occurring after a
holding period of at least two years has elapsed
since the Specified Securities were last acquired
from the Company or from an affiliate of the Company,
whichever is later, and the Owner is not, and during
the preceding three months has not been, an affiliate
of the Company.
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<PAGE> 69
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
By:
-----------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of the
person signing on behalf of the Undersigned
must be stated.)
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<PAGE> 70
Exhibit C
UNRESTRICTED SECURITIES CERTIFICATE
(For removal of Securities Act Legends pursuant to Section 301(b))
Firstar Bank, National Association
425 Walnut Street
Cincinnati, Ohio 45202
Re: 6.34% Securities due 2001
Reference is hereby made to the Indenture, dated as of June
25, 1999 as amended by the Third Supplemental Indenture, dated as of June 25,
1999 (collectively, the "Indenture"), between The Kroger Co., as issuer (the
"Company"), the Guarantors named therein, and Firstar Bank, National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
This certificate relates to US$_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s). ___________________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be exchanged for
Securities bearing no Private Placement Legend pursuant to Section 301(b) of the
Indenture. In connection with such exchange, the Owner hereby certifies that the
exchange is occurring after a holding period of at least two years (computed in
accordance with paragraph (d) of Rule 144) has elapsed since the Specified
Securities were last acquired from the Company or from an affiliate of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company. The Owner also
acknowledges that any future transfers of the Specified Securities must
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<PAGE> 71
comply with all applicable securities laws of the states of the United States
and other jurisdictions.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
By:
-----------------------------------------
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of the
person signing on behalf of the Undersigned
must be stated.)
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<PAGE> 72
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
- ----------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
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<PAGE> 73
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
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<PAGE> 1
Exhibit 4.5
THE KROGER CO.
$250,000,000 6.34% SENIOR NOTES DUE 2001
$350,000,000 7.25% SENIOR NOTES DUE 2009
$300,000,000 7.70% SENIOR NOTES DUE 2029
UNCONDITIONALLY GUARANTEED AS TO THE
PAYMENT OF PRINCIPAL, PREMIUM,
IF ANY, AND INTEREST BY
THE GUARANTORS LISTED ON SIGNATURE PAGES AND
SCHEDULE I HERETO
-----
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
------------------------------------------
June 25, 1999
Goldman, Sachs & Co.,
As representatives of the several Purchasers
named in Schedule I to the Purchase Agreement
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
The Kroger Co., an Ohio corporation (the "Company"), proposes to issue
and sell to the Purchasers (as defined herein) upon the terms set forth in the
Purchase Agreement (as defined herein) its $250,000,000 6.34% Senior Notes due
2001, $350,000,000 7.25% Senior Notes due 2009, and $300,000,000 7.70% Senior
Notes due 2029, which are unconditionally guaranteed by the guarantors set forth
on Schedule I hereto. As an inducement to the Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to the obligations of the
Purchasers thereunder, the Company and the Guarantors agree with the Purchasers
for the benefit of holders (as defined herein) from time to time of the
Registrable Securities (as defined herein) as follows:
1. Certain Definitions. For purposes of this Exchange and Registration
Rights Agreement, the following terms shall have the following respective
meanings:
"Base Interest" shall mean the interest that would otherwise accrue on
the Securities under the terms thereof and the Indenture, without giving
effect to the provisions of this Agreement.
The term "broker-dealer" shall mean any broker or dealer registered
with the Commission under the Exchange Act.
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<PAGE> 2
"Closing Date" shall mean the date on which the Securities are
initially issued.
"Commission" shall mean the United States Securities and Exchange
Commission, or any other federal agency at the time administering the Exchange
Act or the Securities Act, whichever is the relevant statute for the particular
purpose.
"Effective Time," in the case of (i) an Exchange Registration, shall
mean the time and date as of which the Commission declares the Exchange
Registration Statement effective or as of which the Exchange Registration
Statement otherwise becomes effective and (ii) a Shelf Registration, shall mean
the time and date as of which the Commission declares the Shelf Registration
Statement effective or as of which the Shelf Registration Statement otherwise
becomes effective.
"Electing Holder" shall mean any holder of Registrable Securities that
has returned a completed and signed Notice and Questionnaire to the Company in
accordance with Section 3(d)(ii) or 3(d)(iii) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, or any
successor thereto, as the same shall be amended from time to time.
"Exchange Offer" shall have the meaning assigned thereto in Section
2(a) hereof.
"Exchange Registration" shall have the meaning assigned thereto in
Section 3(c) hereof.
"Exchange Registration Statement" shall have the meaning assigned
thereto in Section 2(a) hereof.
"Exchange Securities" shall have the meaning assigned thereto in
Section 2(a) hereof.
"Guarantors" shall mean the parties listed as guarantors on the
signature pages and Schedule I hereto.
The term "holder" shall mean each of the Purchasers and other persons
who acquire Registrable Securities from time to time (including any successors
or assigns), in each case for so long as such person owns any Registrable
Securities.
"Indenture" shall mean the Indenture, dated as of June 25, 1999,
between the Company, the Guarantors and Firstar, National Association, as
Trustee, as the same shall be amended from time to time.
"Notice and Questionnaire" means a Notice of Registration Statement and
Selling Securityholder Questionnaire substantially in the form of Exhibit A
hereto.
The term "person" shall mean a corporation, association, partnership,
organization, business, individual, government or political subdivision thereof
or governmental agency.
"Purchase Agreement" shall mean the Purchase Agreement, dated as of
June 18, 1999, between the Purchasers, the Guarantors and the Company relating
to the Securities.
"Purchasers" shall mean the Purchasers named in Schedule I to the
Purchase Agreement.
2
<PAGE> 3
"Registrable Securities" shall mean the Securities; provided, however,
that a Security shall cease to be a Registrable Security when (i) in the
circumstances contemplated by Section 2(a) hereof, the Security has been
exchanged for an Exchange Security in an Exchange Offer as contemplated in
Section 2(a) hereof; provided that any Exchange Security that, pursuant to the
last two sentences of Section 2(a), is included in a prospectus for use in
connection with resales by broker-dealers shall be deemed to be a Registrable
Security with respect to Sections 5, 6 and 9 until resale of such Registrable
Security has been effected within the 180-day period referred to in Section
2(a); (ii) in the circumstances contemplated by Section 2(b) hereof, a Shelf
Registration Statement registering such Security under the Securities Act has
been declared or becomes effective and such Security has been sold or otherwise
transferred by the holder thereof pursuant to and in a manner contemplated by
such effective Shelf Registration Statement; (iii) such Security is sold
pursuant to Rule 144 under circumstances in which any legend borne by such
Security relating to restrictions on transferability thereof, under the
Securities Act or otherwise, is removed by the Company or pursuant to the
Indenture; (iv) such Security is eligible to be sold pursuant to paragraph (k)
of Rule 144; or (v) such Security shall cease to be outstanding.
"Registration Default" shall have the meaning assigned thereto in
Section 2(c) hereof.
"Registration Expenses" shall have the meaning assigned thereto in
Section 4 hereof.
"Resale Period" shall have the meaning assigned thereto in Section 2(a)
hereof.
"Restricted Holder" shall mean (i) a holder that is an affiliate of the
Company within the meaning of Rule 405, (ii) a holder who acquires Exchange
Securities outside the ordinary course of such holder's business, (iii) a holder
who has arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing Exchange Securities and (iv) a
holder that is a broker-dealer, but only with respect to Exchange Securities
received by such broker-dealer pursuant to an Exchange Offer in exchange for
Registrable Securities acquired by the broker-dealer directly from the Company.
"Rule 144," "Rule 405" and "Rule 415" shall mean, in each case, such
rule promulgated under the Securities Act (or any successor provision), as the
same shall be amended from time to time.
"Securities" shall mean, collectively, the $250,000,000 6.34% Senior
Notes due 2001, the $350,000,000 7.25% Senior Notes due 2009 and the
$300,000,000 7.70% Senior Notes due 2029 of the Company, to be issued and sold
to the Purchasers, and securities issued in exchange therefor or in lieu thereof
pursuant to the Indenture. Each Security is entitled to the benefit of the
guarantee provided for in the Indenture (the "Guarantee") and, unless the
context otherwise requires, any reference herein to a "Security," an "Exchange
Security" or a "Registrable Security" shall include a reference to the related
Guarantee.
"Securities Act" shall mean the Securities Act of 1933, or any
successor thereto, as the same shall be amended from time to time.
"Shelf Registration" shall have the meaning assigned thereto in Section
2(b) hereof.
3
<PAGE> 4
"Shelf Registration Statement" shall have the meaning assigned thereto
in Section 2(b) hereof.
"Special Interest" shall have the meaning assigned thereto in Section
2(c) hereof.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, or
any successor thereto, and the rules, regulations and forms promulgated
thereunder, all as the same shall be amended from time to time.
Unless the context otherwise requires, any reference herein to a
"Section" or "clause" refers to a Section or clause, as the case may be, of this
Exchange and Registration Rights Agreement, and the words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Exchange and
Registration Rights Agreement as a whole and not to any particular Section or
other subdivision.
2. Registration Under the Securities Act.
(a) Except as set forth in Section 2(b) below, the Company agrees to
file under the Securities Act, as soon as practicable, but no later than 90
days after the Closing Date, a registration statement relating to an offer
to exchange (such registration statement, the "Exchange Registration
Statement", and such offer, the "Exchange Offer") any and all of the
Securities for a like aggregate principal amount of debt securities issued
by the Company and guaranteed by the Guarantors, which debt securities and
guarantees are substantially identical to the Securities and the related
Guarantee, respectively (and are entitled to the benefits of a trust
indenture which is substantially identical to the Indenture or is the
Indenture and which has been qualified under the Trust Indenture Act),
except that they have been registered pursuant to an effective registration
statement under the Securities Act and do not contain provisions for the
additional interest contemplated in Section 2(c) below (such new debt
securities hereinafter called "Exchange Securities"). The Company agrees to
use its best efforts to cause the Exchange Registration Statement to become
effective under the Securities Act as soon as practicable, but no later
than 180 days after the Closing Date. The Exchange Offer will be registered
under the Securities Act on the appropriate form and will comply with all
applicable tender offer rules and regulations under the Exchange Act. The
Company further agrees to use its best efforts to commence and complete the
Exchange Offer promptly, but no later than 45 days after such registration
statement has become effective, hold the Exchange Offer open for at least
30 days and exchange Exchange Securities for all Registrable Securities
that have been properly tendered and not withdrawn on or prior to the
expiration of the Exchange Offer. The Exchange Offer will be deemed to have
been "completed" only if the debt securities and related guarantees
received by holders other than Restricted Holders in the Exchange Offer for
Registrable Securities are, upon receipt, transferable by each such holder
without restriction under the Securities Act and the Exchange Act and
without material restrictions under the blue sky or securities laws of a
substantial majority of the States of the United States of America. The
Exchange Offer shall be deemed to have been completed upon the earlier to
occur of (i) the Company having exchanged the Exchange Securities for all
outstanding Registrable Securities pursuant to the Exchange Offer and (ii)
the Company having exchanged, pursuant to the Exchange Offer, Exchange
Securities for all Registrable Securities that have been properly tendered
and not withdrawn before the expiration of the Exchange Offer, which shall
be on a date that is at least 30 days following the commencement of the
Exchange Offer. The Company agrees (x) to include in the Exchange
Registration Statement a prospectus for use in any resales by any holder of
4
<PAGE> 5
Exchange Securities that is a broker-dealer and (y) to keep such Exchange
Registration Statement effective for a period (the "Resale Period")
beginning when Exchange Securities are first issued in the Exchange Offer
and ending upon the earlier of the expiration of the 180th day after the
Exchange Offer has been completed or such time as such broker-dealers no
longer own any Registrable Securities. With respect to such Exchange
Registration Statement, such holders shall have the benefit of the rights
of indemnification and contribution set forth in Sections 6(a), (c), (d)
and (e) hereof."
(b) If (i) on or prior to the time the Exchange Offer is completed
existing Commission interpretations are changed such that the debt
securities or the related guarantees received by holders other than
Restricted Holders in the Exchange Offer for Registrable Securities are not
or would not be, upon receipt, transferable by each such holder without
restriction under the Securities Act, (ii) the Exchange Offer has not been
completed within 225 days following the Closing Date or (iii) the Exchange
Offer is not available to any holder of the Securities, the Company shall,
in lieu of (or, in the case of clause (iii), in addition to) conducting the
Exchange Offer contemplated by Section 2(a), file under the Securities Act
as promptly as practicable a "shelf" registration statement providing for
the registration of, and the sale on a continuous or delayed basis by the
holders of, all of the Registrable Securities, pursuant to Rule 415 or any
similar rule that may be adopted by the Commission (such filing, the "Shelf
Registration" and such registration statement, the "Shelf Registration
Statement"). The Company agrees to use its best efforts (x) to cause the
Shelf Registration Statement to become or be declared effective no later
than 120 days after such Shelf Registration Statement is filed and to keep
such Shelf Registration Statement continuously effective for a period
ending on the earlier of the second anniversary of the Effective Time or
such time as there are no longer any Registrable Securities outstanding,
provided, however, that no holder shall be entitled to be named as a
selling securityholder in the Shelf Registration Statement or to use the
prospectus forming a part thereof for resales of Registrable Securities
unless such holder is an Electing Holder, and (y) after the Effective Time
of the Shelf Registration Statement, promptly upon the request of any
holder of Registrable Securities that is not then an Electing Holder, to
take any action reasonably necessary to enable such holder to use the
prospectus forming a part thereof for resales of Registrable Securities,
including, without limitation, any action necessary to identify such holder
as a selling securityholder in the Shelf Registration Statement, provided,
however, that nothing in this Clause (y) shall relieve any such holder of
the obligation to return a completed and signed Notice and Questionnaire to
the Company in accordance with Section 3(d)(iii) hereof. The Company
further agrees to supplement or make amendments to the Shelf Registration
Statement, as and when required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement or by the Securities Act or rules and regulations
thereunder for shelf registration, and the Company agrees to furnish to
each Electing Holder copies of any such supplement or amendment prior to
its being used or promptly following its filing with the Commission.
(c) In the event that (i) the Company has not filed the Exchange
Registration Statement or Shelf Registration Statement on or before the
date on which such registration statement is required to be filed pursuant
to Section 2(a) or 2(b), respectively, or (ii) such Exchange Registration
Statement or Shelf Registration Statement has not become effective or been
declared effective by the Commission on or before the date on which such
registration statement is required to become or be declared effective
pursuant to Section 2(a) or 2(b), respectively, or (iii) the Exchange Offer
has not been completed within 45 days after the
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<PAGE> 6
initial effective date of the Exchange Registration Statement relating to
the Exchange Offer (if the Exchange Offer is then required to be made) or
(iv) any Exchange Registration Statement or Shelf Registration Statement
required by Section 2(a) or 2(b) hereof is filed and declared effective but
shall thereafter either be withdrawn by the Company or shall become subject
to an effective stop order issued pursuant to Section 8(d) of the
Securities Act suspending the effectiveness of such registration statement
(except as specifically permitted herein) without being succeeded
immediately by an additional registration statement filed and declared
effective (each such event referred to in clauses (i) through (iv), a
"Registration Default" and each period during which a Registration Default
has occurred and is continuing, a "Registration Default Period"), then, as
liquidated damages for such Registration Default, subject to the provisions
of Section 9(b), special interest ("Special Interest"), in addition to the
Base Interest, shall accrue at a per annum rate of 0.25% for the first 90
days of the Registration Default Period, at a per annum rate of 0.50% for
the second 90 days of the Registration Default Period, at a per annum rate
of 0.75% for the third 90 days of the Registration Default Period and at a
per annum rate of 1.0% thereafter for the remaining portion of the
Registration Default Period.
(d) The Company shall take, and shall cause the Guarantors to take, all
actions necessary or advisable to be taken by it to ensure that the
transactions contemplated herein are effected as so contemplated, including
all actions necessary or desirable to register the Guarantee under the
registration statement contemplated in Section 2(a) or 2(b) hereof, as
applicable.
(e) Any reference herein to a registration statement as of any time
shall be deemed to include any document incorporated, or deemed to be
incorporated, therein by reference as of such time and any reference herein
to any post-effective amendment to a registration statement as of any time
shall be deemed to include any document incorporated, or deemed to be
incorporated, therein by reference as of such time.
3. Registration Procedures.
If the Company files a registration statement pursuant to Section 2(a)
or Section 2(b), the following provisions shall apply:
(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, the Company shall qualify the Indenture
under the Trust Indenture Act of 1939.
(b) In the event that such qualification would require the appointment
of a new trustee under the Indenture, the Company shall appoint a new
trustee thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Company's obligations with respect to the
registration of Exchange Securities as contemplated by Section 2(a) (the
"Exchange Registration"), if applicable, the Company shall, as soon as
practicable (or as otherwise specified):
(i) prepare and file with the Commission, as soon as practicable
but no later than 90 days after the Closing Date, an Exchange
Registration Statement on any form which may be utilized by the
Company and which shall permit the Exchange Offer and resales of
Exchange Securities by broker-dealers during the Resale Period to be
effected as contemplated by Section 2(a), and use its best efforts to
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<PAGE> 7
cause such Exchange Registration Statement to become effective as soon
as practicable thereafter, but no later than 180 days after the
Closing Date;
(ii) as soon as practicable prepare and file with the Commission
such amendments and supplements to such Exchange Registration
Statement and the prospectus included therein as may be necessary to
effect and maintain the effectiveness of such Exchange Registration
Statement for the periods and purposes contemplated in Section 2(a)
hereof and as may be required by the applicable rules and regulations
of the Commission and the instructions applicable to the form of such
Exchange Registration Statement, and promptly provide each
broker-dealer holding Exchange Securities with such number of copies
of the prospectus included therein (as then amended or supplemented),
in conformity in all material respects with the requirements of the
Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission thereunder, as such broker-dealer
reasonably may request prior to the expiration of the Resale Period,
for use in connection with resales of Exchange Securities;
(iii) promptly notify each broker-dealer that has requested or
received copies of the prospectus included in such registration
statement, and confirm such advice in writing, (A) when such Exchange
Registration Statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has
been filed, and, with respect to such Exchange Registration Statement
or any post-effective amendment, when the same has become effective,
(B) of any comments by the Commission and by the blue sky or
securities commissioner or regulator of any state with respect thereto
or any request by the Commission for amendments or supplements to such
Exchange Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such Exchange Registration Statement
or the initiation or threatening of any proceedings for that purpose,
(D) if at any time the representations and warranties of the Company
contemplated by Section 5 cease to be true and correct in all material
respects, (E) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Exchange
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, or (F) at any time
during the Resale Period when a prospectus is required to be delivered
under the Securities Act, that such Exchange Registration Statement,
prospectus, prospectus amendment or supplement or post-effective
amendment does not conform in all material respects to the applicable
requirements of the Securities Act and the Trust Indenture Act and the
rules and regulations of the Commission thereunder or contains an
untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing;
(iv) in the event that the Company would be required, pursuant to
Section 3(e)(iii)(F) above, to notify any broker-dealers holding
Exchange Securities, without delay prepare and furnish to each such
holder a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to purchasers of such
Exchange Securities during the Resale Period, such prospectus shall
conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and
regulations of the
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<PAGE> 8
Commission thereunder and shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in
light of the circumstances then existing;
(v) use its reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of such Exchange Registration
Statement or any post-effective amendment thereto at the earliest
practicable date;
(vi) use its reasonable best efforts to (A) register or qualify
the Exchange Securities under the securities laws or blue sky laws of
such jurisdictions as are contemplated by Section 2(a) no later than
the commencement of the Exchange Offer, (B) keep such registrations or
qualifications in effect and comply with such laws so as to permit the
continuance of offers, sales and dealings therein in such
jurisdictions until the expiration of the Resale Period and (C) take
any and all other actions as may be reasonably necessary or advisable
to enable each broker-dealer holding Exchange Securities to consummate
the disposition thereof in such jurisdictions; provided, however, that
neither the Company nor the Guarantors shall be required for any such
purpose to (1) qualify as a foreign corporation in any jurisdiction
wherein it would not otherwise be required to qualify but for the
requirements of this Section 3(c)(vi), (2) consent to general service
of process in any such jurisdiction or (3) make any changes to its
certificate of incorporation or by-laws or any agreement between it
and its stockholders;
(vii) use its reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Exchange
Registration, the Exchange Offer and the offering and sale of Exchange
Securities by broker-dealers during the Resale Period;
(viii) provide a CUSIP number for all Exchange Securities, not
later than the applicable Effective Time;
(ix) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as
soon as practicable but no later than eighteen months after the
effective date of such Exchange Registration Statement, an earning
statement of the Company and its subsidiaries complying with Section
11(a) of the Securities Act (including, at the option of the Company,
Rule 158 thereunder).
(d) In connection with the Company's obligations with respect to the Shelf
Registration, if applicable, the Company shall, as soon as practicable (or as
otherwise specified):
(i) prepare and file with the Commission, as soon as practicable but
in any case within the time periods specified in Section 2(b), a Shelf
Registration Statement on any form which may be utilized by the Company and
which shall register all of the Registrable Securities for resale by the
holders thereof in accordance with such method or methods of disposition as
may be specified by such of the holders as, from time to time, may be
Electing Holders and use its best efforts to cause such Shelf Registration
Statement to become effective as soon as practicable but in any case within
the time periods specified in Section 2(b);
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<PAGE> 9
(ii) not less than 30 calendar days prior to the Effective Time of the
Shelf Registration Statement, mail the Notice and Questionnaire to the
holders of Registrable Securities; no holder shall be entitled to be named
as a selling securityholder in the Shelf Registration Statement as of the
Effective Time, and no holder shall be entitled to use the prospectus
forming a part thereof for resales of Registrable Securities at any time,
unless such holder has returned a completed and signed Notice and
Questionnaire to the Company by the deadline for response set forth
therein; provided, however, holders of Registrable Securities shall have at
least 28 calendar days from the date on which the Notice and Questionnaire
is first mailed to such holders to return a completed and signed Notice and
Questionnaire to the Company;
(iii) after the Effective Time of the Shelf Registration Statement,
upon the request of any holder of Registrable Securities that is not then
an Electing Holder, promptly send a Notice and Questionnaire to such
holder; provided that the Company shall not be required to take any action
to name such holder as a selling securityholder in the Shelf Registration
Statement or to enable such holder to use the prospectus forming a part
thereof for resales of Registrable Securities until such holder has
returned a completed and signed Notice and Questionnaire to the Company;
(iv) as soon as practicable prepare and file with the Commission such
amendments and supplements to such Shelf Registration Statement and the
prospectus included therein as may be necessary to effect and maintain the
effectiveness of such Shelf Registration Statement for the period specified
in Section 2(b) hereof and as may be required by the applicable rules and
regulations of the Commission and the instructions applicable to the form
of such Shelf Registration Statement, and furnish to the Electing Holders
copies of any such supplement or amendment simultaneously with or prior to
its being used or filed with the Commission;
(v) comply with the provisions of the Securities Act with respect to
the disposition of all of the Registrable Securities covered by such Shelf
Registration Statement in accordance with the intended methods of
disposition by the Electing Holders provided for in such Shelf Registration
Statement;
(vi) provide (A) the Electing Holders, (B) the underwriters (which
term, for purposes of this Exchange and Registration Rights Agreement,
shall include a person deemed to be an underwriter within the meaning of
Section 2(a)(11) of the Securities Act), if any, thereof, (C) any sales or
placement agent therefor, (D) counsel for any such underwriter or agent and
(E) not more than one counsel for all the Electing Holders the opportunity
to participate in the preparation of such Shelf Registration Statement,
each prospectus included therein or filed with the Commission and each
amendment or supplement thereto;
(vii) for a reasonable period prior to the filing of such Shelf
Registration Statement, and throughout the period specified in Section
2(b), make available at reasonable times at the Company's principal place
of business or such other reasonable place for inspection by the persons
referred to in Section 3(d)(vi) who shall certify to the Company that they
have a current intention to sell the Registrable Securities pursuant to the
Shelf Registration such financial and other information
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<PAGE> 10
and books and records of the Company, and cause the officers, employees,
counsel and independent certified public accountants of the Company to
respond to such inquiries, as shall be reasonably necessary, in the
judgment of the respective counsel referred to in such Section, to conduct
a reasonable investigation within the meaning of Section 11 of the
Securities Act; provided, however, that each such party shall be required
to maintain in confidence and not to disclose to any other person any
information or records reasonably designated by the Company as being
confidential, until such time as (A) such information becomes a matter of
public record (whether by virtue of its inclusion in such registration
statement or otherwise), or (B) such person shall be required so to
disclose such information pursuant to a subpoena or order of any court or
other governmental agency or body having jurisdiction over the matter
(subject to the requirements of such order, and only after such person
shall have given the Company prompt prior written notice of such
requirement), or (C) such information is required to be set forth in such
Shelf Registration Statement or the prospectus included therein or in an
amendment to such Shelf Registration Statement or an amendment or
supplement to such prospectus in order that such Shelf Registration
Statement, prospectus, amendment or supplement, as the case may be,
complies with applicable requirements of the federal securities laws and
the rules and regulations of the Commission and does not contain an untrue
statement of a material fact or omit to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing;
(viii) promptly notify each of the Electing Holders, any sales or
placement agent therefor and any underwriter thereof (which notification
may be made through any managing underwriter that is a representative of
such underwriter for such purpose) and confirm such advice in writing, (A)
when such Shelf Registration Statement or the prospectus included therein
or any prospectus amendment or supplement or post-effective amendment has
been filed, and, with respect to such Shelf Registration Statement or any
post-effective amendment, when the same has become effective, (B) of any
comments by the Commission and by the blue sky or securities commissioner
or regulator of any state with respect thereto or any request by the
Commission for amendments or supplements to such Shelf Registration
Statement or prospectus or for additional information, (C) of the issuance
by the Commission of any stop order suspending the effectiveness of such
Shelf Registration Statement or the initiation or threatening of any
proceedings for that purpose, (D) if at any time the representations and
warranties of the Company contemplated by Section 3(d)(xvii) or Section 5
cease to be true and correct in all material respects, (E) of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose, or (F) if
at any time when a prospectus is required to be delivered under the
Securities Act, that such Shelf Registration Statement, prospectus,
prospectus amendment or supplement or post-effective amendment does not
conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations of
the Commission thereunder or contains an untrue statement of a material
fact or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;
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<PAGE> 11
(ix) use its reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of such registration statement or any
post-effective amendment thereto at the earliest practicable date;
(x) if requested by any managing underwriter or underwriters, any
placement or sales agent or any Electing Holder, promptly incorporate in a
prospectus supplement or post-effective amendment such information as is
reasonably required by the applicable rules and regulations of the
Commission and as such managing underwriter or underwriters, such agent or
such Electing Holder specifies should be included therein relating to the
terms of the sale of such Registrable Securities, including information
with respect to the principal amount of Registrable Securities being sold
by such Electing Holder or agent or to any underwriters, the name and
description of such Electing Holder, agent or underwriter, the offering
price of such Registrable Securities and any discount, commission or other
compensation payable in respect thereof, the purchase price being paid
therefor by such underwriters and with respect to any other terms of the
offering of the Registrable Securities to be sold by such Electing Holder
or agent or to such underwriters; and make all required filings of such
prospectus supplement or post-effective amendment promptly after
notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment;
(xi) furnish to each Electing Holder, each placement or sales agent,
if any, therefor, each underwriter, if any, thereof and the respective
counsel referred to in Section 3(d)(vi) an executed copy (or, in the case
of an Electing Holder, a conformed copy) of such Shelf Registration
Statement, each such amendment and supplement thereto (in each case
including all exhibits thereto (in the case of an Electing Holder of
Registrable Securities, upon request) and documents incorporated by
reference therein) and such number of copies of such Shelf Registration
Statement (excluding exhibits thereto and documents incorporated by
reference therein unless specifically so requested by such Electing Holder,
agent or underwriter, as the case may be) and of the prospectus included in
such Shelf Registration Statement (including each preliminary prospectus
and any summary prospectus), in conformity in all material respects with
the applicable requirements of the Securities Act and the Trust Indenture
Act and the rules and regulations of the Commission thereunder, and such
other documents, as such Electing Holder, agent, if any, and underwriter,
if any, may reasonably request in order to facilitate the offering and
disposition of the Registrable Securities owned by such Electing Holder,
offered or sold by such agent or underwritten by such underwriter and to
permit such Electing Holder, agent and underwriter to satisfy the
prospectus delivery requirements of the Securities Act; and the Company
hereby consents to the use of such prospectus (including such preliminary
and summary prospectus) and any amendment or supplement thereto by each
such Electing Holder and by any such agent and underwriter, in each case in
the form most recently provided to such person by the Company, in
connection with the offering and sale of the Registrable Securities covered
by the prospectus (including such preliminary and summary prospectus) or
any supplement or amendment thereto;
(xii) use its reasonable best efforts to (A) register or qualify the
Registrable Securities to be included in such Shelf Registration Statement
under such securities laws or blue sky laws of such jurisdictions as any
Electing Holder and each
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<PAGE> 12
placement or sales agent, if any, therefor and underwriter, if any, thereof
shall reasonably request, (B) keep such registrations or qualifications in
effect and comply with such laws so as to permit the continuance of offers,
sales and dealings therein in such jurisdictions during the period the
Shelf Registration is required to remain effective under Section 2(b) above
and for so long as may be necessary to enable any such Electing Holder,
agent or underwriter to complete its distribution of Securities pursuant to
such Shelf Registration Statement and (C) take any and all other actions as
may be reasonably necessary or advisable to enable each such Electing
Holder, agent, if any, and underwriter, if any, to consummate the
disposition in such jurisdictions of such Registrable Securities; provided,
however, that neither the Company nor the Guarantors shall not be required
for any such purpose to (1) qualify as a foreign corporation in any
jurisdiction wherein it would not otherwise be required to qualify but for
the requirements of this Section 3(d)(xii), (2) consent to general service
of process in any such jurisdiction or (3) make any changes to its
certificate of incorporation or by-laws or any agreement between it and its
stockholders;
(xiii) use its reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal, state
or local, which may be required to effect the Shelf Registration or the
offering or sale in connection therewith or to enable the selling holder or
holders to offer, or to consummate the disposition of, their Registrable
Securities;
(xiv) Unless any Registrable Securities shall be in book-entry only
form, cooperate with the Electing Holders and the managing underwriters, if
any, to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold, which certificates, if so
required by any securities exchange upon which any Registrable Securities
are listed, shall be penned, lithographed or engraved, or produced by any
combination of such methods, on steel engraved borders, and which
certificates shall not bear any restrictive legends; and, in the case of an
underwritten offering, enable such Registrable Securities to be in such
denominations and registered in such names as the managing underwriters may
request at least two business days prior to any sale of the Registrable
Securities;
(xv) provide a CUSIP number for all Registrable Securities, not later
than the applicable Effective Time;
(xvi) enter into one or more underwriting agreements, engagement
letters, agency agreements, "best efforts" underwriting agreements or
similar agreements, as appropriate, including customary provisions relating
to indemnification and contribution, and take such other actions in
connection therewith as any Electing Holders aggregating at least 20% in
aggregate principal amount of the Registrable Securities at the time
outstanding shall reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities;
(xvii) whether or not an agreement of the type referred to in Section
3(d)(xvi) hereof is entered into and whether or not any portion of the
offering contemplated by the Shelf Registration is an underwritten offering
or is made through a placement or sales agent or any other entity, (A) make
such representations and warranties to the Electing Holders and the
placement or sales agent, if any, therefor and the underwriters, if any,
thereof in form, substance and scope as are customarily made
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<PAGE> 13
by the Company in connection with an offering of debt securities pursuant
to any appropriate agreement or to a registration statement filed on the
form applicable to the Shelf Registration; (B) obtain an opinion of counsel
to the Company in the customary form used by the Company and covering such
matters, of the type customarily covered by such an opinion, as the
managing underwriters, if any, or as any Electing Holders of at least 20%
in aggregate principal amount of the Registrable Securities at the time
outstanding, may reasonably request, addressed to such Electing Holder or
Electing Holders and the placement or sales agent, if any, therefor and the
underwriters, if any, thereof and dated the effective date of such Shelf
Registration Statement (and if such Shelf Registration Statement
contemplates an underwritten offering of a part or all of the Registrable
Securities, dated the date of the closing under the underwriting agreement
relating thereto); (C) obtain a "cold comfort" letter or letters from the
independent certified public accountants of the Company addressed to the
selling Electing Holders, the placement or sales agent, if any, therefor or
the underwriters, if any, thereof, dated (i) the effective date of such
Shelf Registration Statement and (ii) the effective date of any prospectus
supplement to the prospectus included in such Shelf Registration Statement
or post-effective amendment to such Shelf Registration Statement which
includes unaudited or audited financial statements as of a date or for a
period subsequent to that of the latest such statements included in such
prospectus (and, if such Shelf Registration Statement contemplates an
underwritten offering pursuant to any prospectus supplement to the
prospectus included in such Shelf Registration Statement or post-effective
amendment to such Shelf Registration Statement which includes unaudited or
audited financial statements as of a date or for a period subsequent to
that of the latest such statements included in such prospectus, dated the
date of the closing under the underwriting agreement relating thereto),
such letter or letters to be in customary form delivered by the Company's
independent certified public accountants and covering such matters of the
type customarily covered by letters of such type; (D) deliver such
documents and certificates, including officers' certificates, as may be
reasonably requested by any Electing Holders of at least 20% in aggregate
principal amount of the Registrable Securities at the time outstanding or
the placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or those
contained in Section 5(a) hereof and the compliance with or satisfaction of
any agreements or conditions contained in the underwriting agreement or
other agreement entered into by the Company or the Guarantors; and (E)
undertake such obligations relating to expense reimbursement,
indemnification and contribution as are provided in Section 6 hereof;
(xviii) notify in writing each holder of Registrable Securities of any
proposal by the Company to amend or waive any provision of this Exchange
and Registration Rights Agreement pursuant to Section 9(h) hereof and of
any amendment or waiver effected pursuant thereto, each of which notices
shall contain the text of the amendment or waiver proposed or effected, as
the case may be;
(xix) in the event that any broker-dealer registered under the
Exchange Act shall underwrite any Registrable Securities or participate as
a member of an underwriting syndicate or selling group or "assist in the
distribution" (within the meaning of the Conduct Rules (the "Conduct Rules)
of the National Association of
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<PAGE> 14
Securities Dealers, Inc. ("NASD") or any successor thereto, as amended from
time to time) thereof, whether as a holder of such Registrable Securities
or as an underwriter, a placement or sales agent or a broker or dealer in
respect thereof, or otherwise, assist such broker-dealer in complying with
the requirements of such Conduct Rules, including by (A) if such Conduct
Rules shall so require, engaging a "qualified independent underwriter" (as
defined in such Conduct Rules) to participate in the preparation of the
Shelf Registration Statement relating to such Registrable Securities, to
exercise usual standards of due diligence in respect thereto and, if any
portion of the offering contemplated by such Shelf Registration Statement
is an underwritten offering or is made through a placement or sales agent,
to recommend the yield of such Registrable Securities, (B) indemnifying any
such qualified independent underwriter to the extent of the indemnification
of underwriters provided in Section 6 hereof (or to such other customary
extent as may reasonably be requested by such underwriter), and (C)
providing such information to such broker-dealer as may be required in
order for such broker-dealer to comply with the requirements of the Conduct
Rules; and
(xx) comply with all applicable rules and regulations of the
Commission, and make generally available to its securityholders as soon as
practicable but in any event not later than eighteen months after the
effective date of such Shelf Registration Statement, an earning statement
of the Company and its subsidiaries complying with Section 11(a) of the
Securities Act (including, at the option of the Company, Rule 158
thereunder).
(e) In the event that the Company would be required, pursuant to Section
3(d)(viii)(F) above, to notify the Electing Holders, the placement or sales
agent, if any, therefor and the managing underwriters, if any, thereof, the
Company shall without delay prepare and furnish to each of the Electing Holders,
to each placement or sales agent, if any, and to each such underwriter, if any,
a reasonable number of copies of a prospectus supplemented or amended so that,
as thereafter delivered to purchasers of Registrable Securities, such prospectus
shall conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations of the
Commission thereunder and shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances then
existing. Each Electing Holder agrees that upon receipt of any notice from the
Company pursuant to Section 3(d)(viii)(F) hereof, such Electing Holder shall
forthwith discontinue the disposition of Registrable Securities pursuant to the
Shelf Registration Statement applicable to such Registrable Securities until
such Electing Holder shall have received copies of such amended or supplemented
prospectus, and if so directed by the Company, such Electing Holder shall
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in such Electing Holder's possession of the
prospectus covering such Registrable Securities at the time of receipt of such
notice.
(f) In the event of a Shelf Registration, in addition to the information
required to be provided by each Electing Holder in its Notice Questionnaire, the
Company may require such Electing Holder to furnish to the Company such
additional information regarding such Electing Holder and such Electing Holder's
intended method of distribution of Registrable Securities as may be required in
order to comply with the Securities Act. Each such Electing Holder agrees to
notify the Company as promptly as practicable of any inaccuracy
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<PAGE> 15
or change in information previously furnished by such Electing Holder to
the Company or of the occurrence of any event in either case as a result of
which any prospectus relating to such Shelf Registration contains or would
contain an untrue statement of a material fact regarding such Electing
Holder or such Electing Holder's intended method of disposition of such
Registrable Securities or omits to state any material fact regarding such
Electing Holder or such Electing Holder's intended method of disposition of
such Registrable Securities required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances
then existing, and promptly to furnish to the Company any additional
information required to correct and update any previously furnished
information or required so that such prospectus shall not contain, with
respect to such Electing Holder or the disposition of such Registrable
Securities, an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing.
(g) Until the expiration of two years after the Closing Date, the
Company will not, and will not permit any of its "affiliates" (as defined
in Rule 144) to, resell any of the Securities that have been reacquired by
any of them except pursuant to an effective registration statement under
the Securities Act.
4. Registration Expenses.
The Company agrees to bear and to pay or cause to be paid promptly
all expenses incident to the Company's performance of or compliance with this
Exchange and Registration Rights Agreement, including (a) all Commission and any
NASD registration, filing and review fees and expenses including fees and
disbursements of counsel for the placement or sales agent or underwriters in
connection with such registration, filing and review, (b) all fees and expenses
in connection with the qualification of the Securities for offering and sale
under the State securities and blue sky laws referred to in Section 3(d)(xii)
hereof and determination of their eligibility for investment under the laws of
such jurisdictions as any managing underwriters or the Electing Holders may
designate, including any reasonable fees and disbursements of a single counsel
for the Electing Holders or underwriters in connection with such qualification
and determination, (c) all expenses relating to the preparation, printing,
production, distribution and reproduction of each registration statement
required to be filed hereunder, each prospectus included therein or prepared for
distribution pursuant hereto, each amendment or supplement to the foregoing, the
expenses of preparing the Securities for delivery and the expenses of printing
or producing any underwriting agreements, agreements among underwriters, selling
agreements and blue sky or legal investment memoranda and all other documents in
connection with the offering, sale or delivery of Securities to be disposed of
(including certificates representing the Securities), (d) messenger, telephone
and delivery expenses relating to the offering, sale or delivery of Securities
and the preparation of documents referred in clause (c) above, (e) fees and
expenses of the Trustee under the Indenture, any agent of the Trustee and any
counsel for the Trustee and of any collateral agent or custodian, (f) internal
expenses (including all salaries and expenses of the Company's officers and
employees performing legal or accounting duties), (g) fees, disbursements and
expenses of counsel and independent certified public accountants of the Company
(including the expenses of any opinions or "cold comfort" letters required by or
incident to such performance and compliance), (h) fees, disbursements and
expenses of any "qualified independent underwriter" engaged pursuant to Section
3(d)(xix) hereof, (i) fees, disbursements and expenses of one counsel for the
Electing Holders retained in connection with a Shelf Registration, as selected
by the Electing Holders of at least a majority in aggregate principal
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<PAGE> 16
amount of the Registrable Securities held by Electing Holders (which counsel
shall be reasonably satisfactory to the Company), (j) any fees charged by
securities rating services for rating the Securities, and (k) fees, expenses and
disbursements of any other persons, including special experts, retained by the
Company in connection with such registration (collectively, the "Registration
Expenses"). To the extent that any Registration Expenses are incurred, assumed
or paid by any holder of Registrable Securities or any placement or sales agent
therefor or underwriter thereof, the Company shall reimburse such person for the
full amount of the Registration Expenses so incurred, assumed or paid promptly
after receipt of a request therefor. Notwithstanding the foregoing, the holders
of the Registrable Securities being registered shall pay all agency fees and
commissions and underwriting discounts and commissions attributable to the sale
of such Registrable Securities and the fees and disbursements of any counsel or
other advisors or experts retained by such holders (severally or jointly), other
than the counsel and experts specifically referred to above.
5. Representations and Warranties.
The Company represents and warrants to, and agrees with, each Purchaser
and each of the holders from time to time of Registrable Securities that:
(a) Each registration statement covering Registrable Securities and
each prospectus (including any preliminary or summary prospectus) contained
therein or furnished pursuant to Section 3(d) or Section 3(c) hereof and
any further amendments or supplements to any such registration statement or
prospectus, when it becomes effective or is filed with the Commission, as
the case may be, and, in the case of an underwritten offering of
Registrable Securities, at the time of the closing under the underwriting
agreement relating thereto, will conform in all material respects to the
requirements of the Securities Act and the Trust Indenture Act and the
rules and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading; and at all times subsequent to the Effective Time when a
prospectus would be required to be delivered under the Securities Act,
other than from (i) such time as a notice has been given to holders of
Registrable Securities pursuant to Section 3(d)(viii)(F) or Section
3(c)(iii)(F) hereof until (ii) such time as the Company furnishes an
amended or supplemented prospectus pursuant to Section 3(e) or Section
3(c)(iv) hereof, each such registration statement, and each prospectus
(including any summary prospectus) contained therein or furnished pursuant
to Section 3(d) or Section 3(c) hereof, as then amended or supplemented,
will conform in all material respects to the requirements of the Securities
Act and the Trust Indenture Act and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by a holder of Registrable Securities expressly for
use therein.
(b) Any documents incorporated by reference in any prospectus referred
to in Section 5(a) hereof, when they become or became effective or are or
were filed with the Commission, as the case may be, will conform or
conformed in all material respects to the requirements of the Securities
Act or the Exchange Act, as applicable, and none of such documents will
contain or contained an untrue statement of a material fact or will omit or
omitted to state a material fact required to be stated therein or necessary
to make the
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<PAGE> 17
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by a holder of Registrable Securities expressly for
use therein.
(c) The compliance by the Company with all of the provisions of this
Exchange and Registration Rights Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any subsidiary of the Company is a
party or by which the Company or any subsidiary of the Company is bound or
to which any of the property or assets of the Company or any subsidiary of
the Company is subject, nor will such action result in any violation of (i)
the provisions of the certificate of incorporation, as amended, or the
by-laws of the Company or any Guarantor or (ii) any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any subsidiary of the Company or any of
their respective properties, except, in the case of this clause (ii), such
violations as would not have a material adverse effect upon the business or
financial condition of the Company and its subsidiaries, taken as a
whole;and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the consummation by the Company and the Guarantors of the
transactions contemplated by this Exchange and Registration Rights
Agreement, except the registration under the Securities Act of the
Securities, qualification of the Indenture under the Trust Indenture Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under State securities or blue sky laws
in connection with the offering and distribution of the Securities.
(d) This Exchange and Registration Rights Agreement has been duly
authorized, executed and delivered by the Company and the Guarantors.
6. Indemnification.
(a) Indemnification by the Company and the Guarantors. The Company and
the Guarantors, jointly and severally, will indemnify and hold harmless
each of the holders of Registrable Securities included in an Exchange
Registration Statement, each of the Electing Holders of Registrable
Securities included in a Shelf Registration Statement and each person who
participates as a placement or sales agent or as an underwriter in any
offering or sale of such Registrable Securities against any losses, claims,
damages or liabilities, joint or several, to which such holder, agent or
underwriter may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Exchange
Registration Statement or Shelf Registration Statement, as the case may be,
under which such Registrable Securities were registered under the
Securities Act, or any preliminary, final or summary prospectus contained
therein or furnished by the Company to any such holder, Electing Holder,
agent or underwriter, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse such holder, such
Electing Holder, such agent and such underwriter for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however,
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<PAGE> 18
that neither the Company nor the Guarantors shall be liable to any such
person in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such registration
statement, or preliminary, final or summary prospectus, or amendment or
supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by such person expressly for use
therein.
(b) Indemnification by the Holders and any Agents and Underwriters.
The Company will require, as a condition to including any Registrable
Securities in any registration statement filed pursuant to Section 2(b)
hereof and to entering into any underwriting agreement with respect
thereto, that the Company shall have received an undertaking reasonably
satisfactory to it from the Electing Holder of such Registrable Securities
and from each underwriter named in any such underwriting agreement,
severally and not jointly, to (i) indemnify and hold harmless the Company,
the Guarantors, and all other holders of Registrable Securities, against
any losses, claims, damages or liabilities to which the Company , the
Guarantors or such other holders of Registrable Securities may become
subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of
or are based upon an untrue statement or alleged untrue statement of a
material fact contained in such registration statement, or any preliminary,
final or summary prospectus contained therein or furnished by the Company
to any such Electing Holder, agent or underwriter, or any amendment or
supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company by such Electing Holder or underwriter expressly for use therein,
and (ii) reimburse the Company and the Guarantors for any legal or other
expenses reasonably incurred by the Company and the Guarantors in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that no such Electing Holder
shall be required to undertake liability to any person under this Section
6(b) for any amounts in excess of the dollar amount of the proceeds to be
received by such Electing Holder from the sale of such Electing Holder's
Registrable Securities pursuant to such registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party under subsection (a) or (b) above of written notice of the
commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against an indemnifying party pursuant to the
indemnification provisions of or contemplated by this Section 6, notify
such indemnifying party in writing of the commencement of such action; but
the omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than
under the indemnification provisions of or contemplated by Section 6(a) or
6(b) hereof. In case any such action shall be brought against any
indemnified party and it shall notify an indemnifying party of the
commencement thereof, such indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, such
indemnifying party shall not be liable to such indemnified party for any
legal expenses of other counsel or any
-18-
<PAGE> 19
other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs
of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party
is an actual or potential party to such action or claim) unless such
settlement, compromise or judgment (i) includes an unconditional release of
the indemnified party from all liability arising out of such action or
claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) Contribution. If for any reason the indemnification provisions
contemplated by Section 6(a) or Section 6(b) are unavailable to or
insufficient to hold harmless an indemnified party in respect of any
losses, claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative fault of the
indemnifying party and the indemnified party in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of such indemnifying party and
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to
information supplied by such indemnifying party or by such indemnified
party, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
parties hereto agree that it would not be just and equitable if
contributions pursuant to this Section 6(d) were determined by pro rata
allocation (even if the holders or any agents or underwriters or all of
them were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to in this Section 6(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages, or
liabilities (or actions in respect thereof) referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred
by such indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 6(d),
no holder shall be required to contribute any amount in excess of the
amount by which the dollar amount of the proceeds received by such holder
from the sale of any Registrable Securities (after deducting any fees,
discounts and commissions applicable thereto) exceeds the amount of any
damages which such holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission,
and no underwriter shall be required to contribute any amount in excess of
the amount by which the total price at which the Registrable Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The holders' and any underwriters'
obligations in this Section 6(d) to contribute shall be several in
proportion to the principal amount of Registrable Securities registered or
underwritten, as the case may be, by them and not joint.
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<PAGE> 20
(e) The obligations of the Company and the Guarantors under this
Section 6 shall be in addition to any liability which the Company or the
Guarantors may otherwise have and shall extend, upon the same terms and
conditions, to each officer, director and partner of each holder, agent and
underwriter and each person, if any, who controls any holder, agent or
underwriter within the meaning of the Securities Act; and the obligations
of the holders and any agents or underwriters contemplated by this Section
6 shall be in addition to any liability which the respective holder, agent
or underwriter may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company or the Guarantors
and to each person, if any, who controls the Company within the meaning of
the Securities Act.
7. Underwritten Offerings.
(a) Selection of Underwriters. If any of the Registrable Securities
covered by the Shelf Registration are to be sold pursuant to an
underwritten offering, the managing underwriter or underwriters thereof
shall be designated by Electing Holders holding at least a majority in
aggregate principal amount of the Registrable Securities to be included in
such offering, provided that such designated managing underwriter or
underwriters is or are reasonably acceptable to the Company.
(b) Participation by Holders. Each holder of Registrable Securities
hereby agrees with each other such holder that no such holder may
participate in any underwritten offering hereunder unless such holder (i)
agrees to sell such holder's Registrable Securities on the basis provided
in any underwriting arrangements approved by the persons entitled hereunder
to approve such arrangements and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents reasonably required under the terms of such
underwriting arrangements.
8. Rule 144.
The Company covenants to the holders of Registrable Securities that
to the extent it shall be required to do so under the Exchange Act, the Company
shall timely file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Section 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitations of the exemption
provided by Rule 144 under the Securities Act, as such Rule may be amended from
time to time, or any similar or successor rule or regulation hereafter adopted
by the Commission. Upon the request of any holder of Registrable Securities in
connection with that holder's sale pursuant to Rule 144, the Company shall
deliver to such holder a written statement as to whether it has complied with
such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. The Company represents, warrants,
covenants and agrees that it has not granted, and shall not grant,
registration rights with respect to Registrable Securities or any other
securities which would be inconsistent with the terms contained in this
Exchange and Registration Rights Agreement.
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<PAGE> 21
(b) Specific Performance. The parties hereto acknowledge that there
would be no adequate remedy at law if the Company fails to perform any of
its obligations hereunder and that the Purchasers and the holders from time
to time of the Registrable Securities may be irreparably harmed by any such
failure, and accordingly agree that the Purchasers and such holders, in
addition to any other remedy to which they may be entitled at law or in
equity, shall be entitled to compel specific performance of the obligations
of the Company under this Exchange and Registration Rights Agreement in
accordance with the terms and conditions of this Exchange and Registration
Rights Agreement, in any court of the United States or any State thereof
having jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have
been duly given when delivered by hand, if delivered personally or by
courier, or three days after being deposited in the mail (registered or
certified mail, postage prepaid, return receipt requested) as follows: If
to the Company, to it at 1014 Vine Street, Cincinnati, Ohio 45202,
Attention, General Counsel, and if to a holder, to the address of such
holder set forth in the security register or other records of the Company,
or to such other address as the Company or any such holder may have
furnished to the other in writing in accordance herewith, except that
notices of change of address shall be effective only upon receipt.
(d) Parties in Interest. All the terms and provisions of this Exchange
and Registration Rights Agreement shall be binding upon, shall inure to the
benefit of and shall be enforceable by the parties hereto and the holders
from time to time of the Registrable Securities and the respective
successors and assigns of the parties hereto and such holders. In the event
that any transferee of any holder of Registrable Securities shall acquire
Registrable Securities, in any manner, whether by gift, bequest, purchase,
operation of law or otherwise, such transferee shall, without any further
writing or action of any kind, be deemed a beneficiary hereof for all
purposes and such Registrable Securities shall be held subject to all of
the terms of this Exchange and Registration Rights Agreement, and by taking
and holding such Registrable Securities such transferee shall be entitled
to receive the benefits of, and be conclusively deemed to have agreed to be
bound by all of the applicable terms and provisions of this Exchange and
Registration Rights Agreement. If the Company shall so request, any such
successor, assign or transferee shall agree in writing to acquire and hold
the Registrable Securities subject to all of the applicable terms hereof.
(e) Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Exchange and
Registration Rights Agreement or made pursuant hereto shall remain in full
force and effect regardless of any investigation (or statement as to the
results thereof) made by or on behalf of any holder of Registrable
Securities, any director, officer or partner of such holder, any agent or
underwriter or any director, officer or partner thereof, or any controlling
person of any of the foregoing, and shall survive delivery of and payment
for the Registrable Securities pursuant to the Purchase Agreement and the
transfer and registration of Registrable Securities by such holder and the
consummation of an Exchange Offer.
(f) GOVERNING LAW. THIS EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.
(g) Headings. The descriptive headings of the several Sections and
paragraphs of this Exchange and Registration Rights Agreement are inserted
for convenience only, do
-21-
<PAGE> 22
not constitute a part of this Exchange and Registration Rights Agreement
and shall not affect in any way the meaning or interpretation of this
Exchange and Registration Rights Agreement.
(h) Entire Agreement; Amendments. This Exchange and Registration
Rights Agreement and the other writings referred to herein (including the
Indenture and the form of Securities) or delivered pursuant hereto which
form a part hereof contain the entire understanding of the parties with
respect to its subject matter. This Exchange and Registration Rights
Agreement supersedes all prior agreements and understandings between the
parties with respect to its subject matter. This Exchange and Registration
Rights Agreement may be amended and the observance of any term of this
Exchange and Registration Rights Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively) only
by a written instrument duly executed by the Company and the holders of at
least a majority in aggregate principal amount of the Registrable
Securities at the time outstanding. Each holder of any Registrable
Securities at the time or thereafter outstanding shall be bound by any
amendment or waiver effected pursuant to this Section 9(h), whether or not
any notice, writing or marking indicating such amendment or waiver appears
on such Registrable Securities or is delivered to such holder.
(i) Inspection. For so long as this Exchange and Registration Rights
Agreement shall be in effect, this Exchange and Registration Rights
Agreement and a complete list of the names and addresses of all the holders
of Registrable Securities shall be made available for inspection and
copying on any business day by any holder of Registrable Securities for
proper purposes only (which shall include any purpose related to the rights
of the holders of Registrable Securities under the Securities, the
Indenture and this Agreement) at the offices of the Company at the address
thereof set forth in Section 9(c) above and at the office of the Trustee
under the Indenture.
(j) Counterparts. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same
instrument.
-22-
<PAGE> 23
If the foregoing is in accordance with your understanding, please sign
and return to us ONE FOR THE COMPANY AND EACH OF THE REPRESENTATIVES PLUS ONE
FOR EACH COUNSEL counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers, the Guarantors
and the Company. It is understood that your acceptance of this letter on behalf
of each of the Purchasers is pursuant to the authority set forth in a form of
Agreement among Purchasers, the form of which shall be submitted to the Company
for examination upon request, but without warranty on your part as to the
authority of the signers thereof.
Very truly yours,
THE KROGER CO.
By: /s/ Lawrence M. Turner
--------------------------------------
Name: Lawrence M. Turner
Title: Vice President and Treasurer
The Guarantors listed on Schedule I hereto
By: /s/ Paul Heldman
--------------------------------------
Name: Paul Heldman
Title: Vice President
HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steven McMillan
--------------------------------------
Name: Steven McMillan
Title: Vice President & Secretary
VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
--------------------------------------
Name: Bruce M. Gack
Title: Vice President
KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
By: /s/ Paul Heldman
--------------------------------------
Name: Paul Heldman
Title: President
-23-
<PAGE> 24
RICHIE'S, INC.,
as Guarantor of the Securities
By: (Keith C. Larson)
------------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
-24-
<PAGE> 25
Accepted as of the date hereof:
Goldman, Sachs & Co.
Banc One Capital Markets, Inc.
Banc of America Securities LLC
Chase Securities Inc.
Salomon Smith Barney
By: .................................................
(Goldman, Sachs & Co.)
On behalf of each of the Purchasers
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<PAGE> 26
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
Rocket Newco, Inc. Texas
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
-26-
<PAGE> 27
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
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<PAGE> 28
EXHIBIT A
THE KROGER CO.
INSTRUCTION TO DTC PARTICIPANTS
-------------------------------
(Date of Mailing)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: [DATE] *
-------------------------------
The Depository Trust Company ("DTC") has identified you as a DTC Participant
through which beneficial interests in The Kroger Co. (the "Company")
$250,000,000 6.34% Senior Notes due 2001, $350,000,000 7.25% Senior Notes due
2009, and $300,000,000 7.70% Senior Notes due 2029 (the "Securities") are held.
The Company is in the process of registering the Securities under the Securities
Act of 1933 for resale by the beneficial owners thereof. In order to have their
Securities included in the registration statement, beneficial owners must
complete and return the enclosed Notice of Registration Statement and Selling
Securityholder Questionnaire.
IT IS IMPORTANT THAT BENEFICIAL OWNERS OF THE SECURITIES RECEIVE A COPY OF THE
ENCLOSED MATERIALS AS SOON AS POSSIBLE as their rights to have the Securities
included in the registration statement depend upon their returning the Notice
and Questionnaire by [DEADLINE FOR RESPONSE]. Please forward a copy of the
enclosed documents to each beneficial owner that holds interests in the
Securities through you. If you require more copies of the enclosed materials or
have any questions pertaining to this matter, please contact The Kroger Co.,
1014 Vine Street, Cincinnati, Ohio 4520, 513 762-4000, Attention, Law
Department.
- ---------------------
*Not less than 28 calendar days from date of mailing.
-1-
<PAGE> 29
THE KROGER CO.
Notice of Registration Statement
and
SELLING SECURITYHOLDER QUESTIONNAIRE
------------------------------------
(Date)
Reference is hereby made to the Exchange and Registration Rights Agreement (the
"Exchange and Registration Rights Agreement") between The Kroger Co. (the
"Company") and the Purchasers named therein. Pursuant to the Exchange and
Registration Rights Agreement, the Company has filed with the United States
Securities and Exchange Commission (the "Commission") a registration statement
on Form [__] (the "Shelf Registration Statement") for the registration and
resale under Rule 415 of the Securities Act of 1933, as amended (the "Securities
Act"), of the Company's $250,000,000 6.34% Senior Notes due 2001, $350,000,000
7.25% Senior Notes due 2009, and $300,000,000 7.70% Senior Notes due 2029 (the
"Securities"). A copy of the Exchange and Registration Rights Agreement is
attached hereto. All capitalized terms not otherwise defined herein shall have
the meanings ascribed thereto in the Exchange and Registration Rights Agreement.
Each beneficial owner of Registrable Securities (as defined below) is entitled
to have the Registrable Securities beneficially owned by it included in the
Shelf Registration Statement. In order to have Registrable Securities included
in the Shelf Registration Statement, this Notice of Registration Statement and
Selling Securityholder Questionnaire ("Notice and Questionnaire") must be
completed, executed and delivered to the Company's counsel at the address set
forth herein for receipt ON OR BEFORE [DEADLINE FOR RESPONSE]. Beneficial owners
of Registrable Securities who do not complete, execute and return this Notice
and Questionnaire by such date (i) will not be named as selling securityholders
in the Shelf Registration Statement and (ii) may not use the Prospectus forming
a part thereof for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling securityholder in
the Shelf Registration Statement and related Prospectus. Accordingly, holders
and beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Shelf Registration Statement and
related Prospectus.
The term "REGISTRABLE SECURITIES" is defined in the Exchange and Registration
Rights Agreement.
-2-
<PAGE> 30
ELECTION
The undersigned holder (the "Selling Securityholder") of Registrable Securities
hereby elects to include in the Shelf Registration Statement the Registrable
Securities beneficially owned by it and listed below in Item (3). The
undersigned, by signing and returning this Notice and Questionnaire, agrees to
be bound with respect to such Registrable Securities by the terms and conditions
of this Notice and Questionnaire and the Exchange and Registration Rights
Agreement, including, without limitation, Section 6 of the Exchange and
Registration Rights Agreement, as if the undersigned Selling Securityholder were
an original party thereto.
Upon any sale of Registrable Securities pursuant to the Shelf Registration
Statement, the Selling Securityholder will be required to deliver to the Company
and Trustee the Notice of Transfer set forth in Appendix A to the Prospectus and
as Exhibit B to the Exchange and Registration Rights Agreement.
The Selling Securityholder hereby provides the following information to the
Company and represents and warrants that such information is accurate and
complete:
-3-
<PAGE> 31
QUESTIONNAIRE
(1) (a) Full Legal Name of Selling Securityholder:
--------------------------------------------------------------------
(b) Full Legal Name of Registered Holder (if not the same as in (a)
above) of Registrable Securities Listed in Item (3) below:
--------------------------------------------------------------------
(c) Full Legal Name of DTC Participant (if applicable and if not the
same as (b) above) Through Which Registrable Securities Listed in
Item (3) below are Held:
--------------------------------------------------------------------
(2) Address for Notices to Selling Securityholder:
-----------------------------------
-----------------------------------
-----------------------------------
Telephone:
-----------------------------------
Fax:
-----------------------------------
Contact Person:
-----------------------------------
(3) Beneficial Ownership of Securities:
Except as set forth below in this Item (3), the undersigned does not
beneficially own any Securities.
(a) Principal amount of Registrable Securities beneficially owned:______
CUSIP No(s). of such Registrable Securities:
------------------------
(b) Principal amount of Securities other than Registrable Securities
beneficially owned:
--------------------------------------------------------------------
CUSIP No(s). of such other Securities:
------------------------------
(c) Principal amount of Registrable Securities which the undersigned
wishes to be included in the Shelf Registration Statement:
----------
CUSIP No(s). of such Registrable Securities to be included in the
Shelf Registration Statement:
---------------------------------------
(4) Beneficial Ownership of Other Securities of the Company:
Except as set forth below in this Item (4), the undersigned Selling
Securityholder is not the beneficial or registered owner of any
other securities of the Company, other than the Securities listed
above in Item (3).
State any exceptions here:
-4-
<PAGE> 32
(5) Relationships with the Company:
Except as set forth below, neither the Selling Securityholder nor any
of its affiliates, officers, directors or principal equity holders
(5% or more) has held any position or office or has had any other
material relationship with the Company (or its predecessors or
affiliates) during the past three years.
State any exceptions here:
(6) Plan of Distribution:
Except as set forth below, the undersigned Selling Securityholder
intends to distribute the Registrable Securities listed above in Item
(3) only as follows (if at all): Such Registrable Securities may be
sold from time to time directly by the undersigned Selling
Securityholder or, alternatively, through underwriters,
broker-dealers or agents. Such Registrable Securities may be sold in
one or more transactions at fixed prices, at prevailing market prices
at the time of sale, at varying prices determined at the time of
sale, or at negotiated prices. Such sales may be effected in
transactions (which may involve crosses or block transactions) (i) on
any national securities exchange or quotation service on which the
Registered Securities may be listed or quoted at the time of sale,
(ii) in the over-the-counter market, (iii) in transactions otherwise
than on such exchanges or services or in the over-the-counter market,
or (iv) through the writing of options. In connection with sales of
the Registrable Securities or otherwise, the Selling Securityholder
may enter into hedging transactions with broker-dealers, which may in
turn engage in short sales of the Registrable Securities in the
course of hedging the positions they assume. The Selling
Securityholder may also sell Registrable Securities short and deliver
Registrable Securities to close out such short positions, or loan or
pledge Registrable Securities to broker-dealers that in turn may sell
such securities.
State any exceptions here:
By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the provisions of
the Exchange Act and the rules and regulations thereunder, particularly
Regulation M.
In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Company, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Exchange and
Registration Rights Agreement.
By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus. The Selling Securityholder understands that such information
will be relied upon by the Company in connection with the preparation of the
Shelf Registration Statement and related Prospectus.
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<PAGE> 33
In accordance with the Selling Securityholder's obligation under Section 3(d) of
the Exchange and Registration Rights Agreement to provide such information as
may be required by law for inclusion in the Shelf Registration Statement, the
Selling Securityholder agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein which may occur subsequent to the
date hereof at any time while the Shelf Registration Statement remains in
effect. All notices hereunder and pursuant to the Exchange and Registration
Rights Agreement shall be made in writing, by hand-delivery, first-class mail,
or air courier guaranteeing overnight delivery as follows:
(i) To the Company:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
(ii) With a copy to:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Company's counsel, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the Company and the
Selling Securityholder (with respect to the Registrable Securities beneficially
owned by such Selling Securityholder and listed in Item (3) above. This
Agreement shall be governed in all respects by the laws of the State of New
York.
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<PAGE> 34
IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.
Dated:
--------------------
--------------------------------------------------------------------------
Selling Securityholder
(Print/type full legal name of beneficial owner of Registrable Securities)
By:
-----------------------------------------------------------------------
Name:
Title:
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON
OR BEFORE [DEADLINE FOR RESPONSE] TO THE COMPANY'S COUNSEL AT:
-------------------------
-------------------------
-------------------------
-------------------------
-------------------------
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<PAGE> 35
EXHIBIT B
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
THE KROGER CO.
c/o Firstar, N.A.
[ADDRESS OF TRUSTEE]
Attention: Trust Officer
Re: The Kroger Co. (the "Company")
$250,000,000 6.34% Senior Notes due 2001, $350,000,000 7.25% Senior
Notes due 2009, and $300,000,000 7.70% Senior Notes due 2029
Dear Sirs:
Please be advised that ____________________________ has transferred $ __________
aggregate principal amount of the above-referenced Notes pursuant to an
effective Registration Statement on Form [__] (File No. 333- ______) filed by
the Company.
We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied and that the above-named
beneficial owner of the Notes is named as a "Selling Holder" in the Prospectus
dated [DATE] or in supplements thereto, and that the aggregate principal amount
of the Notes transferred are the Notes listed in such Prospectus opposite such
owner's name.
Dated:
Very truly yours,
-------------------------
(Name)
By:
-------------------------
(Authorized Signature)
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<PAGE> 1
Exhibit 4.6
================================================================================
THE KROGER CO.
and certain of its Subsidiaries, as Guarantors
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
SECOND SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of October 15, 1993
----------
$200,000,000 General Term Notes(SM), Series B
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE ONE
DEFINITIONS
<S> <C>
Section 101. Definitions...................................................................................2
ARTICLE TWO
GUARANTEE
Section 201. Guarantee.....................................................................................3
Section 202. Waiver of Demand..............................................................................4
Section 203. Guarantee of Payment..........................................................................4
Section 204. No Discharge or Diminishment of Guarantee.....................................................5
Section 205. Defenses of Company Waived....................................................................5
Section 206. Continued Effectiveness.......................................................................5
Section 207. Subrogation...................................................................................6
Section 208. Information...................................................................................6
Section 209. Subordination.................................................................................6
Section 210. Termination...................................................................................7
Section 211. Guarantees of other Indebtedness..............................................................7
Section 212. Additional Guarantors.........................................................................7
Section 213. Limitation of Guarantor's Liability...........................................................8
Section 214. Contribution from Other Guarantors............................................................8
Section 215. No Obligation to Take Action Against the Company..............................................8
Section 216. Dealing with the Company and Others...........................................................8
Section 217. Subordination of Guarantee....................................................................9
ARTICLE THREE
SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. Guarantee Obligations Subordinated to Senior Indebtedness of Guarantors.......................9
Section 302. Payment Over of Proceeds Upon Dissolution, Etc...............................................10
Section 303. No Payment When Senior Indebtedness in Default...............................................11
Section 304. Payment Permitted if no Default..............................................................12
Section 305. Subrogation to Rights of Holders of Senior Indebtedness......................................12
Section 306. Provisions Solely to Define Relative Rights..................................................13
Section 307. Trustee to Effectuate Subordination..........................................................13
Section 308. No Waiver of Subordination Provisions........................................................13
Section 309. Notice to Trustee............................................................................14
Section 310. Reliance on Judicial Order or Certificate of Liquidating Agent...............................15
Section 311. Trustee Not Fiduciary for Holders of Senior Indebtedness.....................................15
</TABLE>
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<PAGE> 3
<TABLE>
<S> <C>
Section 312. Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's Rights........15
Section 313. Article Applicable to Paying Agents..........................................................15
Section 314. Authorization to File Claims; Reinstatement of Subordination.................................16
ARTICLE FOUR
MISCELLANEOUS
Section 401. Miscellaneous................................................................................16
</TABLE>
-ii-
<PAGE> 4
SECOND SUPPLEMENTAL INDENTURE, dated as of June 25, 1999,
among The Kroger Co., a corporation duly organized and existing under the laws
of the State of Ohio (herein called the "Company"), having its principal office
at 1014 Vine Street, Cincinnati, Ohio 45202, each of the guarantors signatory
hereto as set forth on the signature pages and Schedule I (collectively, the
"Guarantors") and Firstar Bank, National Association, a banking corporation duly
organized and existing under the laws of the State of Ohio, as Trustee (herein
called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of October 15, 1993 (as amended and supplemented,
the "Indenture") providing for the issuance from time to time of the Company's
unsecured debentures, notes or other evidences of indebtedness (herein and
therein called the "Securities"), to be issued in one or more series as in the
Indenture provided.
The Indenture has been supplemented by the First Supplemental
Indenture, dated as of October 15, 1993 (the "First Supplemental Indenture"),
providing for the issuance of the $200,000,000 General Term Notes(SM), Series B
(the "Securities").
Each of the Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly authorized the execution and delivery of this Fourth
Supplemental Indenture.
Section 901(9) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture to make any other provisions with
respect to matters or questions arising under the Indenture, provided that such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Second Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities
issued thereunder.
All things necessary to make this Second Supplemental
Indenture a valid agreement of the Company and each of the Guarantors, and a
valid amendment of and supplement to the Indenture, have been done.
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<PAGE> 5
NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
Section 101. DEFINITIONS.
For all purposes of this Second Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Second
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Second Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Fourth Supplemental Indenture.
(4) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by the Company or Fred Meyer,
Inc. and outstanding on the date of this Second Supplemental Indenture, and any
refinancing or other restructuring of any such agreement or facility.
(5) "Guarantee" has the meaning specified in Section 201.
(6) "Guaranteed Obligations" has the meaning specified in Section 201.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Notifying Holder" has the meaning specified in Section 303.
(9) "Payment Blockage Period" has the meaning specified in Section 303.
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<PAGE> 6
(10) "Senior Indebtedness" means, with respect to any Guarantor, the
principal of (and premium, if any) and interest on, and all other amounts
payable in respect of, (a) all Indebtedness of such Guarantor, whether
outstanding on the date of this Indenture or thereafter Incurred, (b) any
obligations of such Guarantor under interest rate swaps, caps, collars and
similar arrangements, (c) any obligations of such Guarantor under foreign
currency hedges entered into in respect of any such Indebtedness or obligation
and (d) any amendments, renewals, extensions, modifications, and refundings of
any such Indebtedness or obligation, except (i) any Indebtedness or obligation
owed to a Subsidiary, (ii) any Indebtedness or obligation which by the terms of
the instrument creating or evidencing the same is not superior in right of
payment to such Guarantor's Guarantee, (iii) any Indebtedness or obligation
which is subordinated or junior in any respect to any other Indebtedness or
obligation of such Guarantor, and (iv) any Indebtedness or obligation
constituting a trade account payable of such Guarantor. Any obligation under any
Senior Indebtedness shall continue to constitute Senior Indebtedness despite a
determination that the Incurrence of such obligation by a Guarantor was a
preference under Section 547(b) of Title 11 of the United States Code (or any
successor thereto) or was a fraudulent conveyance or transfer under Federal or
state law.
ARTICLE TWO
-----------
GUARANTEE
Section 201. GUARANTEE.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of the Indenture or
the Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Guaranteed Obligations") will be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Guaranteed Obligations,
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. If the Company shall fail to pay when due, or to
perform, any Guaranteed Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or
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<PAGE> 7
to perform or cause the performance of, the same immediately. An Event of
Default under the Indenture or the Securities shall constitute an event of
default under this Guarantee, and shall entitle the Holders of Securities to
accelerate the Guaranteed Obligations of the Guarantor hereunder in the same
manner and to the same extent as the Guaranteed Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Guaranteed Obligations may be accelerated as provided in Article
Five of the Indenture for the purposes of its Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the Guaranteed Obligations, and (b) in the event of any acceleration of such
Guaranteed Obligations as provided in Article Five of the Indenture, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Guarantor for the purposes of its Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Guaranteed Obligations, and also waives notice of acceptance of its
Guarantee and notice of protest for nonpayment.
Section 203. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee
constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Guaranteed
Obligations.
Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 210 of this Second Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction,
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<PAGE> 8
limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each of the
Guarantors hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Trustee or any Holder of the Securities to assert any
claim or demand or to enforce any remedy under the Indenture or the Securities,
any other guarantee or any other agreement, by any waiver or modification of any
provision of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the Guaranteed Obligations, or by any other act
or omission that may or might in any manner or to any extent vary the risk of
any Guarantor or that would otherwise operate as a discharge of any Guarantor as
a matter of law or equity (other than the indefeasible payment in full in cash
of all the Guaranteed Obligations).
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Company, other than final and indefeasible payment in
full in cash of the Guaranteed Obligations. Each of the Guarantors waives any
defense arising out of any such election even though such election operates to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of each of the Guarantors against the Company or any security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Fourth Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Guaranteed
Obligation is rescinded or must otherwise be restored by the Trustee or any
Holder of the Securities upon the bankruptcy or reorganization of the Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any Guaranteed Obligation when and as the same shall become due,
whether at maturity, by acceleration, after notice of prepayment or otherwise,
each of the Guarantors hereby
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<PAGE> 9
promises to and will, upon receipt of written demand by the Trustee or any
Holder of the Securities, forthwith pay, or cause to be paid, to the Holders in
cash the amount of such unpaid Guaranteed Obligations, and thereupon the Holders
shall, assign (except to the extent that such assignment would render a
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Guaranteed
Obligations owed to it and paid by such Guarantor pursuant to this Guarantee to
such Guarantor, such assignment to be PRO RATA to the extent the Guaranteed
Obligations in question were discharged by such Guarantor, or make such other
disposition thereof as such Guarantor shall direct (all without recourse to the
Holders, and without any representation or warranty by the Holders). If (a) a
Guarantor shall make payment to the Holders of all or any part of the Guaranteed
Obligations and (b) all the Guaranteed Obligations and all other amounts payable
under this Second Supplemental Indenture shall be indefeasibly paid in full, the
Trustee will, at such Guarantor's request, execute and deliver to such Guarantor
appropriate documents, without recourse and without representation or warranty,
necessary to evidence the transfer by subrogation to such Guarantor of an
interest in the Guaranteed Obligations resulting from such payment by such
Guarantor.
Section 208. INFORMATION.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Guaranteed Obligations to the
Trustee; PROVIDED, HOWEVER, that any right of subrogation that such Guarantor
may have pursuant to this Second Supplemental Indenture is subject to Section
207 hereof.
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<PAGE> 10
Section 210. TERMINATION.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Second Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Service and Standard & Poor's Ratings
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged from
its obligations under this Second Supplemental Indenture and its Guarantee if,
upon consummation of such sale, exchange, transfer or other disposition (by
merger or otherwise), such Guarantor remains or becomes a guarantor under any
Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Second Supplemental Indenture and its
Guarantee.
Section 211. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such guarantor, provisions similar to those set forth in Section
210 hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become a Guarantor under this Second Supplemental Indenture, if it has not
already done so or unless the Guarantor is
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<PAGE> 11
prohibited from doing so by applicable law or a provision of a contract to which
it is a party or by which it is bound.
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
by such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Title 11 of the United States Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal of
state law. To effectuate the foregoing intention, the Holders and such Guarantor
hereby irrevocably agree that the obligations of such Guarantor under this
Second Supplemental Indenture and its Guarantee shall be limited to the maximum
amount which, after giving effect to all other contingent and fixed liabilities
of such Guarantor, and after giving effect to any collections from or payments
made by or on behalf of, any other Guarantor in respect of the obligations of
such Guarantor under its Guarantee or pursuant to its contribution obligations
under this Second Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
Section 214. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
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<PAGE> 12
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 217. SUBORDINATION OF GUARANTEE.
The obligations of each Guarantor to the Holders of the
Securities and to the Trustee pursuant to the Guarantee and this Indenture are
expressly subordinate and subject in right of payment to the prior payment in
full in cash of all Senior Indebtedness of such Guarantor, to the extent and in
the manner provided in Article Three.
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. GUARANTEE OBLIGATIONS SUBORDINATED TO SENIOR INDEBTEDNESS OF
GUARANTORS.
Each Guarantor covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees, that, to the
extent and in the manner hereinafter set forth in this Article, the Indebtedness
represented by the Guarantee of such Guarantor, including the obligations of
such Guarantor in respect of the payment of the principal of (and premium, if
any) and interest on each and all of the Securities, is hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
Senior Indebtedness of such Guarantor.
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<PAGE> 13
Section 302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any Guarantor or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of such Guarantor, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the benefit
of creditors or any other marshalling of assets and liabilities of such
Guarantor, then and in any such event the holders of Senior Indebtedness of such
Guarantor shall be entitled to receive payment in full in cash of all amounts
due or to become due on or in respect of all Senior Indebtedness of such
Guarantor before the Holders of the Securities, are entitled to receive any
payment in respect of such Guarantor's Guarantee, including on account of
principal of (or premium, if any) or interest on the Securities and to that end
the holders of Senior Indebtedness of such Guarantor shall be entitled to
receive, for application to the payment of all Senior Indebtedness of such
Guarantor remaining unpaid (to the extent necessary to pay all Senior
Indebtedness of such Guarantor in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Indebtedness), any
payment or distribution of any kind or character, whether in cash, property or
securities, including any such payment or distribution which may be payable or
deliverable by reason of the payment of any other Indebtedness of such Guarantor
being subordinated to the payment of the Guarantee of such Guarantor, which may
be payable or deliverable in respect of such Guarantee in any such case,
proceeding, dissolution, liquidation or other winding up or event.
In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of any Guarantor of any kind or character,
whether in cash, property or securities, including any such payment or
distribution which may be payable or deliverable by reason of the payment of any
other Indebtedness of such Guarantor being subordinated to the payment of the
Guarantee of such Guarantor, before all Senior Indebtedness of such Guarantor is
paid in full, then and in such event such payment or distribution shall be held
in trust by any such Holder for the holders of Senior Indebtedness of such
Guarantor, and if such fact shall, at or prior to the time of such payment or
distribution, have been made known to the Trustee, shall be held by the Trustee
in a separate account, and shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent
or other Person making payment or distribution of assets of such Guarantor for
application to the payment of all Senior Indebtedness of such Guarantor
remaining unpaid, to the extent necessary to pay all Senior Indebtedness in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Indebtedness of such Guarantor.
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<PAGE> 14
The consolidation of any Guarantor with, or the merger of any
Guarantor into, another Person or the liquidation or dissolution of any
Guarantor following the sale, assignment, conveyance or transfer of its
properties and assets substantially as an entirety to another Person upon the
terms and conditions set forth in Article Eight of the Indenture shall not be
deemed a dissolution, winding up, liquidation, reorganization, assignment for
the benefit of creditors or marshalling of assets and liabilities of such
Guarantor for the purposes of this Section 302 if the Person formed by such
consolidation or into which such Guarantor is merged or the Person which
acquires by sale, assignment, conveyance or transfer such properties and assets
substantially as an entirety, as the case may be, shall, as a part of such
consolidation, merger, sale, assignment, conveyance or transfer, comply with the
conditions set forth in Article Eight of the Indenture.
Section 303. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.
No Guarantor may make any payments in respect of its
Guarantee, including any payment in respect of principal of, premium, if any, or
interest on the Securities if (i) any Senior Indebtedness of such Guarantor is
not paid when due and such default is not cured or waived, (ii) any other event
of default on Senior Indebtedness of such Guarantor occurs and the maturity of
such Senior Indebtedness is accelerated in accordance with its terms and such
acceleration is not rescinded or (iii) judicial proceedings shall be pending
with respect to such default in payment or event of default. During the
continuance of any default (other than a default in payment or any other event
of default and acceleration as described in the preceding sentence) with respect
to any Senior Indebtedness, upon the receipt by the Trustee and any Guarantor of
written notice thereof from any holder of such Senior Indebtedness or a
representative of such holder (each a "Notifying Holder"), such Guarantor may
not during the period (the "Payment Blockage Period") commencing on the date of
such receipt of such written notice and ending on the earlier of (i) the date on
which such event of default shall have been cured or waived or cease to exist or
all obligations of each such Guarantor in respect of such Senior Indebtedness
shall have been discharged and (ii) the 179th day after the date of the receipt
of such notice, take any action which would be prohibited by the first sentence
of this Section if any Senior Indebtedness of such Guarantor had not been paid.
Any number of such notices may be given; PROVIDED, HOWEVER, that during any
360-day period the aggregate of all Payment Blockage Periods shall not exceed
179 days and there shall be a period of at least 181 consecutive days in each
360-day period when no Payment Blockage Period is in effect. For all purposes of
this Section 303, no default which existed or was continuing on the date of the
commencement of any Payment Blockage Period and was known to a Notifying Holder
shall be, or be made, the basis for the commencement of a second Payment
Blockage Period by the Notifying Holder, whether or not within a period of 360
consecutive days, unless such default shall have been cured or waived for a
period of not less than 90 consecutive days.
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<PAGE> 15
In the event that, notwithstanding the foregoing, any
Guarantor shall make any payment to the Trustee or the Holder of any Security
prohibited by the foregoing provisions of this Section, then and in such event
such payment shall be held in trust by any such Holder for the holders of Senior
Indebtedness of such Guarantor, and if such fact shall, at or prior to the time
of such payment, have been made known to the Trustee, shall be held by the
Trustee in a separate account, and shall be paid over and delivered forthwith to
such Guarantor.
The provisions of this Section shall not apply to any payment
with respect to which Section 302 would be applicable.
Section 304. PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this
Indenture or in any Guarantee or any Securities shall prevent (a) any Guarantor,
at any time except during the pendency of any case, proceeding, dissolution,
liquidation or other winding up, assignment for the benefit of creditors or
other marshalling of assets and liabilities of such Guarantor referred to in
Section 302 or under the conditions described in Section 303, from making
payments at any time under its Guarantee, including of principal of, premium, if
any, or interest on the Securities or (b) the application by the Trustee of any
money deposited with it hereunder to the payment of or on account of the
principal of or interest on the Securities or the retention of such payment by
the Holders, if, at the time of such application by the Trustee, it did not have
written notice as provided in Section 309, of any event prohibiting such
application.
Section 305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the payment in full of all Senior Indebtedness of
each Guarantor, the Holders of the Securities shall be subrogated to the extent
of the payments or distributions made to the holders of such Senior Indebtedness
of such Guarantor pursuant to the provisions of this Article to the rights of
the holders of such Senior Indebtedness to receive payments and distributions of
cash, property and securities applicable to the Senior Indebtedness of such
Guarantor until the principal of and interest on the Securities shall be paid in
full. For purposes of such subrogation, no payments or distributions to which
the holders of the Senior Indebtedness of any Guarantor or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among such Guarantor, its
creditors other than holders of its Senior Indebtedness and the Holders of the
Securities, be deemed to be a payment or distribution by such Guarantor to or on
account of the Senior Indebtedness of such Guarantor.
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<PAGE> 16
Section 306. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the Holders of the Securities on
the one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in the Indenture or in the Securities is
intended to or shall (a) impair, as among any Guarantor, its creditors and the
Holders of the Securities, the obligation of such Guarantor, which is absolute
and unconditional (and which, subject to the rights under this Article of the
holders of Senior Indebtedness of such Guarantor, is intended to rank equally
with all other general obligations of such Guarantor), to pay to the Holders of
the Securities the principal of (and premium, if any) and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against any Guarantor of the
Holders of the Securities and creditors of such Guarantor other than the holders
of Senior Indebtedness of such Guarantor; or (c) prevent the Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under the Indenture, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.
Section 307. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate, as between the Holders and the holders of Senior
Indebtedness, the subordination provided for in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes.
Section 308. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior
Indebtedness of any Guarantor to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of such Guarantor or by any act or failure to act, in good faith, by
any such holder, or by any non-compliance by such Guarantor with the terms,
provisions and covenants of the Indenture, regardless of any knowledge thereof
any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (i)
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<PAGE> 17
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iii) release any Person liable in any manner for
the collection of Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
Section 309. NOTICE TO TRUSTEE.
Each Guarantor shall give prompt written notice to the Trustee
of any fact known to such Guarantor which would prohibit the making of any
payment to or by the Trustee in respect of the Securities. Notwithstanding the
provisions of this Article or any other provision of the Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until the Trustee shall have received written notice
thereof from any Guarantor, any Holder, any Paying Agent, any holder of any
class of Senior Indebtedness, or any Notifying Holder who shall have been
certified by any Guarantor or otherwise established to the reasonable
satisfaction of the Trustee to be such holder, or from any trustee therefor;
and, prior to the receipt of any such written notice, the Trustee, subject to
the provisions of Section 601 of the Indenture, shall be entitled in all
respects to assume that no such facts exist; PROVIDED, HOWEVER, that if the
Trustee shall not have received the notice provided for in this Section at least
2 Business Days prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of (or premium, if any) or interest on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within 2 Business Days prior
to such date.
Subject to the provisions of Section 601 of the Indenture, the
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a trustee
therefor) to establish that such notice has been given by a holder of Senior
Indebtedness (or a trustee therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may
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<PAGE> 18
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of Senior Indebtedness held by such Person, the extent
to which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under this Article,
and if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment.
Section 310. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
Upon any payment or distribution of assets of any guarantor
referred to in this Article, the Trustee, subject to the provisions of Section
601 of the Indenture, and the Holders of the Securities shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to the Trustee or to the Holders of
Securities, for the purpose of ascertaining the Person entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and
other Indebtedness of such Guarantor, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
Section 311. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR INDEBTEDNESS.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness and shall not be liable to any such holders
if it shall in good faith mistakenly pay over or distribute to Holders of
Securities or to any Guarantor or to any other Person cash, property or
securities to which any holders of Senior Indebtedness of such Guarantor shall
be entitled by virtue of this Article or otherwise.
Section 312. Rights of Trustee as Holder of Senior
INDEBTEDNESS; PRESERVATION OF TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant
to Section 607 of the Indenture.
Section 313. ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents
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<PAGE> 19
and purposes as if such Paying Agent were named in this Article in addition to
or in place of the Trustee; PROVIDED, HOWEVER, that this Section 313 shall not
apply to the Company or any affiliate of the Company if it or such Affiliate
acts as Paying Agent.
Section 314. AUTHORIZATION TO FILE CLAIMS; REINSTATEMENT OF SUBORDINATION.
(a) Each Notifying Holder is hereby irrevocably authorized and
empowered (in its own name or in the name of the Holders or the Trustee or
otherwise), but shall have no obligation, to file claims and proofs of claim in
respect of the Securities in proceedings referred to in Section 302 in the event
such claims or proofs of claim have not been filed prior to 30 days before such
filings would be barred.
(b) The provisions of this Article Three shall continue to be
effective or be reinstated, as the case may be, if at any time any payment of
any obligations in respect of any Senior Indebtedness is rescinded or must
otherwise be returned by any holder of such Senior Indebtedness upon the
insolvency, bankruptcy or reorganization of any Guarantor, all as though such
payment had not been made, PROVIDED, HOWEVER, that this paragraph (b) shall only
apply to payments which had been so rescinded or required to be returned as a
result of a determination that such payment was a preference under Section
547(b) of Title 11 of the United States Code (or any successor thereto) or was a
fraudulent conveyance or fraudulent transfer under Federal or State law.
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Second Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Second Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Second Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Second Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
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<PAGE> 20
(d) All covenants and agreements in this Second Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Second Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Second Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Fourth
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Second
Supplemental Indenture as so modified or excluded, as the case may be.
(h) This Second Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Second Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Fourth Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE> 21
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- ------------------------------ ----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By* : /s/ Paul Heldman
- ------------------------------ ----------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
----------------------------------------
Name: Bruce Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ Bruce M. Gack By: /s/ Paul Heldman
- ------------------------------ ----------------------------------------
Secretary Name: Paul Heldman
Title: President
- ---------------
* Signing as duly authorized officer for each such Guarantor.
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<PAGE> 22
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /s/ Keith C. Larson
- ------------------------------ ----------------------------------------
Name: Keith C. Larson
Title: Vice President Secretary
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<PAGE> 23
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve Mcmillan
- --------------------------- ---------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 24
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ William Sicking
- --------------------------- ------------------------------------------
Assistant Secretary Name: William Sicking
Title: Trust Officer
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<PAGE> 25
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and ____________ of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
--------------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
--------------------------------
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<PAGE> 26
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
--------------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
--------------------------------
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<PAGE> 27
STATE OF __________ )
) ss.:
COUNTY OF ________ )
On the day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
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<PAGE> 28
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
-4-
<PAGE> 29
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
-5-
<PAGE> 1
Exhibit 4.7
================================================================================
THE KROGER CO.
and certain of its Subsidiaries, as Guarantors
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
FOURTH SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of May 1, 1998
----------
$200,000,000 7% Senior Notes due 2018
$200,000,000 6% Puttable Reset Securities PURS(SM) due 2010
$300,000,000 6.8% Senior Notes due 2018
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
Section 101. Definitions...................................................... 2
ARTICLE TWO
GUARANTEE
Section 201. Guarantee........................................................ 3
Section 202. Waiver of Demand................................................. 4
Section 203. Guarantee of Payment............................................. 4
Section 204. No Discharge or Diminishment of Guarantee........................ 4
Section 205. Defenses of Company Waived....................................... 5
Section 206. Continued Effectiveness.......................................... 5
Section 207. Subrogation...................................................... 5
Section 208. Information...................................................... 6
Section 209. Subordination.................................................... 6
Section 210. Termination...................................................... 6
Section 211. Guarantees of other Indebtedness................................. 7
Section 212. Additional Guarantors............................................ 7
Section 213. Limitation of Guarantor's Liability.............................. 7
Section 214. Contribution from Other Guarantors............................... 8
Section 215. No Obligation to Take Action Against the Company................. 8
Section 216. Dealing with the Company and Others.............................. 8
-i-
<PAGE> 3
ARTICLE THREE
MISCELLANEOUS
Section 301. Miscellaneous.................................................... 9
-ii-
<PAGE> 4
FOURTH SUPPLEMENTAL INDENTURE, dated as of June 25, 1999, among The Kroger
Co., a corporation duly organized and existing under the laws of the State of
Ohio (herein called the "Company"), having its principal office at 1014 Vine
Street, Cincinnati, Ohio 45202, each of the guarantors signatory hereto as set
forth on the signature pages and Schedule I (collectively, the "Guarantors") and
Firstar Bank, National Association, a banking corporation duly organized and
existing under the laws of the State of Ohio, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the Trustee an
Indenture dated as of May 1, 1998 (as amended and supplemented, the "Indenture")
providing for the issuance from time to time of the Company's unsecured
debentures, notes or other evidences of indebtedness (herein and therein called
the "Securities"), to be issued in one or more series as in the Indenture
provided.
The Indenture has been supplemented by the First Supplemental Indenture,
dated as of May 11, 1998 (the "First Supplemental Indenture"), the Second
Supplemental Indenture dated as of June 26, 1998 (the "Second Supplemental
Indenture"), and the Third Supplemental Indenture, dated as of December 11, 1998
(the "Third Supplemental Indenture"), providing for the issuance of the
$200,000,000 7% Senior Notes due 2018, the $200,000,000 6% Senior Notes due 2010
and the $300,000,000 6.8% Senior Notes due 2018, respectively (collectively, the
"Securities").
Each of the Guarantors has duly authorized the issuance of a guarantee of
the Securities, as set forth herein, and to provide therefor, each of the
Guarantors has duly authorized the execution and delivery of this Fourth
Supplemental Indenture.
Section 901(9) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental to the Indenture to make any other provisions with respect to
matters or questions arising under the Indenture, provided that such action
shall not adversely affect the interests of the Holders of Securities of any
series in any material respect.
The Company and the Guarantors, pursuant to the foregoing authority,
propose in and by this Fourth Supplemental Indenture to amend and supplement the
Indenture in certain respects with respect to the Securities issued thereunder.
All things necessary to make this Fourth Supplemental Indenture a valid
agreement of the Company and each of the Guarantors, and a valid amendment of
and supplement to the Indenture, have been done.
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<PAGE> 5
NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each of the
Guarantors hereby covenants and agrees with the Trustee and its successor or
successors in said trust under the Indenture, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
For all purposes of this Fourth Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Fourth
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Fourth Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Fourth Supplemental Indenture.
(4) "Credit Facility" means any credit agreement, loan agreement, or credit
facility, whether syndicated or not, involving the extension of credit by banks
or other credit institutions, entered into by the Company or Fred Meyer, Inc.
and outstanding on the date of this Fourth Supplemental Indenture, and any
refinancing or other restructuring of any such agreement or facility.
(5) "Guarantee" has the meaning specified in Section 201.
(6) "Guaranteed Obligations" has the meaning specified in Section 201.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
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<PAGE> 6
ARTICLE TWO
GUARANTEE
Section 201. GUARANTEE.
Each Guarantor hereby jointly and severally fully and unconditionally
guarantees (each a "Guarantee") to each Holder of a Security authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture or the
Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Guaranteed Obligations") will be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Guaranteed Obligations,
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. If the Company shall fail to pay when due, or to
perform, any Guaranteed Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Guaranteed Obligations of the Guarantor
hereunder in the same manner and to the same extent as the Guaranteed
Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Securities or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
of the Indenture or the Securities, any release of any other Guarantor, the
recovery of any judgment against the Company, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Security, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders of Securities and the Trustee, on the other hand, (a) the maturity of
the Guaranteed Obligations may be accelerated as provided in Article Five of the
Indenture for the purposes of its Guarantee, notwithstanding any stay,
injunction or other
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<PAGE> 7
prohibition preventing such acceleration in respect of the Guaranteed
Obligations, and (b) in the event of any acceleration of such Guaranteed
Obligations as provided in Article Five of the Indenture, such Guaranteed
Obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor for the purposes of its Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the Guarantors
waives presentment to, demand of payment from and protest of any of the
Guaranteed Obligations, and also waives notice of acceptance of its Guarantee
and notice of protest for nonpayment.
Section 203. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee constitutes a
guarantee of payment when due and not of collection, and waives any right to
require that any resort be had by the Trustee or any Holder of the Securities to
the security, if any, held for payment of the Guaranteed Obligations.
Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 210 of this Fourth Supplemental Indenture, the
obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each of the
Guarantors hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Trustee or any Holder of the Securities to assert any
claim or demand or to enforce any remedy under the Indenture or the Securities,
any other guarantee or any other agreement, by any waiver or modification of any
provision of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the Guaranteed Obligations, or by any other act
or omission that may or might in any manner or to any extent vary the risk of
any Guarantor or that would otherwise operate as a discharge of any Guarantor as
a matter of law or equity (other than the indefeasible payment in full in cash
of all the Guaranteed Obligations).
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<PAGE> 8
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the Guarantors waives
any defense based on or arising out of any defense of the Company or any other
Guarantor or the unenforceability of the Guaranteed Obligations or any part
thereof from any cause, or the cessation from any cause of the liability of the
Company, other than final and indefeasible payment in full in cash of the
Guaranteed Obligations. Each of the Guarantors waives any defense arising out of
any such election even though such election operates to impair or to extinguish
any right of reimbursement or subrogation or other right or remedy of each of
the Guarantors against the Company or any security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Fourth Supplemental Indenture, each of the
Guarantors further agrees that its Guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by the Trustee or any Holder of the
Securities upon the bankruptcy or reorganization of the Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any other right of
each of the Guarantors by virtue hereof, upon the failure of the Company to pay
any Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Guaranteed Obligations, and
thereupon the Holders shall, assign (except to the extent that such assignment
would render a Guarantor a "creditor" of the Company within the meaning of
Section 547 of Title 11 of the United States Code as now in effect or hereafter
amended or any comparable provision of any successor statute) the amount of the
Guaranteed Obligations owed to it and paid by such Guarantor pursuant to this
Guarantee to such Guarantor, such assignment to be PRO RATA to the extent the
Guaranteed Obligations in question were discharged by such Guarantor, or make
such other disposition thereof as such Guarantor shall direct (all without
recourse to the Holders, and without any representation or warranty by the
Holders). If (a) a Guarantor shall make payment to the Holders of all or any
part of the Guaranteed Obligations and (b) all the Guaranteed Obligations and
all other amounts payable under this Fourth Supplemental Indenture shall be
indefeasibly paid in full, the Trustee will, at such Guarantor's request,
execute and deliver to such Guarantor appropriate documents, without recourse
and without representation or warranty, necessary to evidence the
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<PAGE> 9
transfer by subrogation to such Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by such Guarantor.
Section 208. INFORMATION.
Each of the Guarantors assumes all responsibility for being and keeping
itself informed of the Company's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as provided
above, all rights of such Guarantor against the Company, arising as a result
thereof by way of right of subrogation or otherwise, shall in all respects be
subordinated and junior in right of payment to the prior indefeasible payment in
full in cash of all the Guaranteed Obligations to the Trustee; PROVIDED,
HOWEVER, that any right of subrogation that such Guarantor may have pursuant to
this Fourth Supplemental Indenture is subject to Section 207 hereof.
Section 210. TERMINATION.
A Guarantor shall, upon the occurrence of either of the following events,
be automatically and unconditionally released and discharged from all
obligations under this Fourth Supplemental Indenture and its Guarantee without
any action required on the part of the Trustee or any Holder if such release and
discharge will not result in any downgrade in the rating given to the Securities
by Moody's Investors Service and Standard & Poor's Ratings Services:
(a) upon any sale, exchange, transfer or other disposition (by merger
or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged
from its obligations under this Fourth Supplemental Indenture and its
Guarantee if, upon consummation of such sale, exchange, transfer or other
disposition (by merger or otherwise), such Guarantor remains or becomes a
guarantor under any Credit Facility; or
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<PAGE> 10
(b) at the request of the Company, at any time that none of the Credit
Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release
upon receipt of a request of the Company accompanied by an Officers'
Certificate certifying as to the compliance with this Section. Any
Guarantor not so released will remain liable for the full amount of the
principal of, premium, if any, and interest on the Notes provided in this
Fourth Supplemental Indenture and its Guarantee.
Section 211. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors, the Company
will cause each of its Subsidiaries that becomes a guarantor in respect of (i)
any Indebtedness of the Company which is outstanding on the date hereof and (ii)
any Indebtedness incurred by the Company after the date hereof (other than in
respect of asset-backed securities), to include in any guarantee given by any
such guarantor, provisions similar to those set forth in Section 210 hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a guarantor in
respect of any Indebtedness of the Company following the date hereof to execute
and deliver a supplemental indenture pursuant to which it will become a
Guarantor under this Fourth Supplemental Indenture, if it has not already done
so or unless the Guarantor is prohibited from doing so by applicable law or a
provision of a contract to which it is a party or by which it is bound.
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder, hereby confirms
that it is the intention of all such parties that the Guarantee by such
Guarantor not constitute a fraudulent transfer or conveyance for purposes of
Title 11 of the United States Code, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar Federal of state law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under this Fourth
Supplemental Indenture and its Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of, any other Guarantor in respect of the obligations of such
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Fourth Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
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<PAGE> 11
Section 214. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its Guarantee
shall be entitled to a contribution from each other Guarantor in a PRO RATA
amount based on the net assets of each Guarantor, determined in accordance with
generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall have any
obligation to enforce or exhaust any rights or remedies or take any other steps
under any security for the Guaranteed Obligations or against the Company or any
other Person or any property of the Company or any other Person before the
Trustee, such Holder or such other Person is entitled to demand payment and
performance by any or all Guarantors of their liabilities and obligations under
their Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Company or any
other Person;
(b) take or abstain from taking security or collateral from the
Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect of (with or without consideration)
any and all collateral, mortgages or other security given by the Company or
any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security to such part of the Guaranteed Obligations as the Holders may see
fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal with,
the Company and all other Persons and any security as the Holders or the
Trustee may see fit.
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<PAGE> 12
ARTICLE THREE
MISCELLANEOUS
Section 301. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture, as
supplemented by this Fourth Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Fourth Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Fourth Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as of the date
of execution of this Fourth Supplemental Indenture all of its respective
representations, covenants and agreements set forth in the Indenture.
(d) All covenants and agreements in this Fourth Supplemental Indenture by
the Company, the Guarantors and the Trustee shall bind its respective successors
and assigns, whether so expressed or not.
(e) In case any provisions in this Fourth Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
(f) Nothing in this Fourth Supplemental Indenture, express or implied,
shall give to any Person, other than the parties hereto and their successors
under the Indenture and the Holders of the series of Securities created hereby,
any benefit or any legal or equitable right, remedy or claim under the
Indenture.
(g) If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act of 1939, as may be amended from time to time, that is
required under such Act to be a part of and govern this Fourth Supplemental
Indenture, the latter provision shall control. If any provision hereof modifies
or excludes any provision of such Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Fourth Supplemental Indenture
as so modified or excluded, as the case may be.
(h) This Fourth Supplemental Indenture shall be governed by and
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<PAGE> 13
construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect any and all
series of Securities created under the Indenture.
(j) All provisions of this Fourth Supplemental Indenture shall be deemed to
be incorporated in, and made a part of, the Indenture; and the Indenture, as
supplemented by this Fourth Supplemental Indenture, shall be read, taken and
construed as one and the same instrument.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- -------------------------------- ---------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By*: /s/ Paul Heldman
- -------------------------------- --------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- -------------------------------- ---------------------------------------
Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ Bruce M. Gack By: /s/ Paul Heldman
- -------------------------------- ---------------------------------------
Secretary Name: Paul Heldman
Title: President
- --------------------------------
*Signing as duly authorized officer for each such Guarantor.
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<PAGE> 15
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By:
- -------------------------------- ---------------------------------------
Name:
Title:
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<PAGE> 16
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve McMillan
- -------------------------------- ----------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 17
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ William Sicking
- -------------------------------- ---------------------------------------
Assistant Secretary Name: William Sicking
Title: Trust Officer
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<PAGE> 18
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and ___________ of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 19
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
----------------------------------------
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<PAGE> 20
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 21
SCHEDULE I
GUARANTORS
Name of Guarantor State of Incorporation/Organization
- ----------------- -----------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
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<PAGE> 22
Name of Guarantor State of Incorporation/Organization
- ----------------- -----------------------------------
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
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<PAGE> 1
Exhibit 4.8
================================================================================
THE KROGER CO.
and certain of its Subsidiaries, as Guarantors
TO
FIRSTAR BANK, NATIONAL ASSOCIATION
Trustee
----------
FOURTH SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of July 15, 1996
----------
$240,000,000 8.15% Senior Notes due 2006
$200,000,000 7.65% Senior Notes due 2007
$200,000,000 6 3/8% Senior Notes due 2008
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
Section 101. Definitions..................................................... 2
ARTICLE TWO
GUARANTEE
Section 201. Guarantee....................................................... 3
Section 202. Waiver of Demand................................................ 4
Section 203. Guarantee of Payment............................................ 4
Section 204. No Discharge or Diminishment of Guarantee....................... 4
Section 205. Defenses of Company Waived...................................... 5
Section 206. Continued Effectiveness......................................... 5
Section 207. Subrogation..................................................... 5
Section 208. Information..................................................... 6
Section 209. Subordination................................................... 6
Section 210. Termination..................................................... 6
Section 211. Guarantees of other Indebtedness................................ 7
Section 212. Additional Guarantors........................................... 7
Section 213. Limitation of Guarantor's Liability............................. 7
Section 214. Contribution from Other Guarantors.............................. 8
Section 215. No Obligation to Take Action Against the Company................ 8
Section 216. Dealing with the Company and Others............................. 8
ARTICLE THREE
MISCELLANEOUS
Section 301. Miscellaneous................................................... 9
-i-
<PAGE> 3
FOURTH SUPPLEMENTAL INDENTURE, dated as of June 25, 1999, among The Kroger
Co., a corporation duly organized and existing under the laws of the State of
Ohio (herein called the "Company"), having its principal office at 1014 Vine
Street, Cincinnati, Ohio 45202, each of the guarantors signatory hereto as set
forth on the signature pages and Schedule I (collectively, the "Guarantors") and
Firstar Bank, National Association, a banking corporation duly organized and
existing under the laws of the State of Ohio, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the Trustee an
Indenture dated as of July 15, 1996 (as amended and supplemented, the
"Indenture") providing for the issuance from time to time of the Company's
unsecured debentures, notes or other evidences of indebtedness (herein and
therein called the "Securities"), to be issued in one or more series as in the
Indenture provided.
The Indenture has been supplemented by the First Supplemental Indenture,
dated as of July 29, 1996 (the "First Supplemental Indenture"), the Second
Supplemental Indenture dated as of April 28, 1997 (the "Second Supplemental
Indenture"), and the Third Supplemental Indenture, dated as of February 25, 1998
(the "Third Supplemental Indenture"), providing for the issuance of the
$240,000,000 8.15% Senior Notes due 2006, the $200,000,000 7.65% Senior Notes
due 2007 and the $200,000,000 6 3/8% Senior Notes due 2008, respectively
(collectively, the "Securities").
Each of the Guarantors has duly authorized the issuance of a guarantee of
the Securities, as set forth herein, and to provide therefor, each of the
Guarantors has duly authorized the execution and delivery of this Fourth
Supplemental Indenture.
Section 901(9) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental to the Indenture to make any other provisions with respect to
matters or questions arising under the Indenture, provided that such action
shall not adversely affect the interests of the Holders of Securities of any
series in any material respect.
The Company and the Guarantors, pursuant to the foregoing authority,
propose in and by this Fourth Supplemental Indenture to amend and supplement the
Indenture in certain respects with respect to the Securities issued thereunder.
All things necessary to make this Fourth Supplemental Indenture a valid
agreement of the Company and each of the Guarantors, and a valid amendment of
and supplement to the Indenture, have been done.
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<PAGE> 4
NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each of the
Guarantors hereby covenants and agrees with the Trustee and its successor or
successors in said trust under the Indenture, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
For all purposes of this Fourth Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Fourth
Supplemental Indenture and, where so specified, to the Articles and
Sections of the Indenture as supplemented by this Fourth Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Fourth Supplemental Indenture.
(4) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of
credit by banks or other credit institutions; entered into by the Company
or Fred Meyer, Inc. and outstanding on the date of this Fourth Supplemental
Indenture, and any refinancing or other restructuring of any such agreement
or facility.
(5) "Guarantee" has the meaning specified in Section 201.
(6) "Guaranteed Obligations" has the meaning specified in Section 201.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
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<PAGE> 5
ARTICLE TWO
GUARANTEE
Section 201. GUARANTEE.
Each Guarantor hereby jointly and severally fully and unconditionally
guarantees (each a "Guarantee") to each Holder of a Security authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture or the
Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Guaranteed Obligations") will be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Guaranteed Obligations,
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. If the Company shall fail to pay when due, or to
perform, any Guaranteed Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Guaranteed Obligations of the Guarantor
hereunder in the same manner and to the same extent as the Guaranteed
Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of the
Securities or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Securities with respect to any provisions
of the Indenture or the Securities, any release of any other Guarantor, the
recovery of any judgment against the Company, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Security, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders of Securities and the Trustee, on the other hand, (a) the maturity of
the Guaranteed Obligations may be accelerated as provided in Article Five of the
Indenture for the purposes of its Guarantee, notwithstanding any stay,
injunction or other
-3-
<PAGE> 6
prohibition preventing such acceleration in respect of the Guaranteed
Obligations, and (b) in the event of any acceleration of such Guaranteed
Obligations as provided in Article Five of the Indenture, such Guaranteed
Obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor for the purposes of its Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the Guarantors
waives presentment to, demand of payment from and protest of any of the
Guaranteed Obligations, and also waives notice of acceptance of its Guarantee
and notice of protest for nonpayment.
Section 203. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee constitutes a
guarantee of payment when due and not of collection, and waives any right to
require that any resort be had by the Trustee or any Holder of the Securities to
the security, if any, held for payment of the Guaranteed Obligations.
Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 210 of this Fourth Supplemental Indenture, the
obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each of the
Guarantors hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Trustee or any Holder of the Securities to assert any
claim or demand or to enforce any remedy under the Indenture or the Securities,
any other guarantee or any other agreement, by any waiver or modification of any
provision of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the Guaranteed Obligations, or by any other act
or omission that may or might in any manner or to any extent vary the risk of
any Guarantor or that would otherwise operate as a discharge of any Guarantor as
a matter of law or equity (other than the indefeasible payment in full in cash
of all the Guaranteed Obligations).
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<PAGE> 7
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the Guarantors waives
any defense based on or arising out of any defense of the Company or any other
Guarantor or the unenforceability of the Guaranteed Obligations or any part
thereof from any cause, or the cessation from any cause of the liability of the
Company, other than final and indefeasible payment in full in cash of the
Guaranteed Obligations. Each of the Guarantors waives any defense arising out of
any such election even though such election operates to impair or to extinguish
any right of reimbursement or subrogation or other right or remedy of each of
the Guarantors against the Company or any security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Fourth Supplemental Indenture, each of the
Guarantors further agrees that its Guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by the Trustee or any Holder of the
Securities upon the bankruptcy or reorganization of the Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any other right of
each of the Guarantors by virtue hereof, upon the failure of the Company to pay
any Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Guaranteed Obligations, and
thereupon the Holders shall, assign (except to the extent that such assignment
would render a Guarantor a "creditor" of the Company within the meaning of
Section 547 of Title 11 of the United States Code as now in effect or hereafter
amended or any comparable provision of any successor statute) the amount of the
Guaranteed Obligations owed to it and paid by such Guarantor pursuant to this
Guarantee to such Guarantor, such assignment to be PRO RATA to the extent the
Guaranteed Obligations in question were discharged by such Guarantor, or make
such other disposition thereof as such Guarantor shall direct (all without
recourse to the Holders, and without any representation or warranty by the
Holders). If (a) a Guarantor shall make payment to the Holders of all or any
part of the Guaranteed Obligations and (b) all the Guaranteed Obligations and
all other amounts payable under this Fourth Supplemental Indenture shall be
indefeasibly paid in full, the Trustee will, at such Guarantor's request,
execute and deliver to such Guarantor appropriate documents, without recourse
and without representation or warranty, necessary to evidence the
-5-
<PAGE> 8
transfer by subrogation to such Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by such Guarantor.
Section 208. INFORMATION.
Each of the Guarantors assumes all responsibility for being and keeping
itself informed of the Company's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as provided
above, all rights of such Guarantor against the Company, arising as a result
thereof by way of right of subrogation or otherwise, shall in all respects be
subordinated and junior in right of payment to the prior indefeasible payment in
full in cash of all the Guaranteed Obligations to the Trustee; PROVIDED,
HOWEVER, that any right of subrogation that such Guarantor may have pursuant to
this Fourth Supplemental Indenture is subject to Section 207 hereof.
Section 210. TERMINATION.
A Guarantor shall, upon the occurrence of either of the following events,
be unconditionally released and discharged from all obligations under this
Fourth Supplemental Indenture and its Guarantee without any action required on
the part of the Trustee or any Holder if such release and discharge will not
result in any downgrade in the rating given to the Securities by Moody's
Investors Service and Standard & Poor's Ratings Services:
(a) upon any sale, exchange, transfer or other disposition (by merger
or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged
from its obligations under this Fourth Supplemental Indenture and its
Guarantee if, upon consummation of such sale, exchange, transfer or other
disposition (by merger or otherwise), such Guarantor remains or becomes a
guarantor under any Credit Facility; or
-6-
<PAGE> 9
(b) at the request of the Company, at any time that none of the Credit
Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release
upon receipt of a request of the Company accompanied by an Officers'
Certificate certifying as to the compliance with this Section. Any
Guarantor not so released will remain liable for the full amount of the
principal of, premium, if any, and interest on the Notes provided in this
Fourth Supplemental Indenture and its Guarantee.
Section 211. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors, the Company
will cause each of its Subsidiaries that becomes a guarantor in respect of (i)
any Indebtedness of the Company which is outstanding on the date hereof and (ii)
any Indebtedness incurred by the Company after the date hereof (other than in
respect of asset-backed securities), to include in any guarantee given by any
such guarantor, provisions similar to those set forth in Section 210 hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a guarantor in
respect of any Indebtedness of the Company following the date hereof to execute
and deliver a supplemental indenture pursuant to which it will become a
Guarantor under this Fourth Supplemental Indenture, if it has not already done
so or unless the Guarantor is prohibited from doing so by applicable law or a
provision of a contract to which it is a party or by which it is bound.
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder, hereby confirms
that it is the intention of all such parties that the Guarantee by such
Guarantor not constitute a fraudulent transfer or conveyance for purposes of
Title 11 of the United States Code, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar Federal or state law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under this Fourth
Supplemental Indenture and its Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of, any other Guarantor in respect of the obligations of such
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Fourth Supplemental Indenture, will result in the obligations of such
Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
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<PAGE> 10
Section 214. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its Guarantee
shall be entitled to a contribution from each other Guarantor in a PRO RATA
amount based on the net assets of each Guarantor, determined in accordance with
generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall have any
obligation to enforce or exhaust any rights or remedies or take any other steps
under any security for the Guaranteed Obligations or against the Company or any
other Person or any property of the Company or any other Person before the
Trustee, such Holder or such other Person is entitled to demand payment and
performance by any or all Guarantors of their liabilities and obligations under
their Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Company or any
other Person;
(b) take or abstain from taking security or collateral from the
Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect of (with or without consideration)
any and all collateral, mortgages or other security given by the Company or
any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security to such part of the Guaranteed Obligations as the Holders may see
fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal with,
the Company and all other Persons and any security as the Holders or the
Trustee may see fit.
-8-
<PAGE> 11
ARTICLE THREE
MISCELLANEOUS
Section 301. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture, as
supplemented by this Fourth Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Fourth Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Fourth Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as of the date
of execution of this Fourth Supplemental Indenture all of its respective
representations, covenants and agreements set forth in the Indenture.
(d) All covenants and agreements in this Fourth Supplemental Indenture by
the Company, the Guarantors and the Trustee shall bind its respective successors
and assigns, whether so expressed or not.
(e) In case any provisions in this Fourth Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
(f) Nothing in this Fourth Supplemental Indenture, express or implied,
shall give to any Person, other than the parties hereto and their successors
under the Indenture and the Holders of the series of Securities created hereby,
any benefit or any legal or equitable right, remedy or claim under the
Indenture.
(g) If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act of 1939, as may be amended from time to time, that is
required under such Act to be a part of and govern this Fourth Supplemental
Indenture, the latter provision shall control. If any provision hereof modifies
or excludes any provision of such Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Fourth Supplemental Indenture
as so modified or excluded, as the case may be.
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<PAGE> 12
(h) This Fourth Supplemental Indenture shall be governed by and construed
in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect any and all
series of Securities created under the Indenture.
(j) All provisions of this Fourth Supplemental Indenture shall be deemed to
be incorporated in, and made a part of, the Indenture; and the Indenture, as
supplemented by this Fourth Supplemental Indenture, shall be read, taken and
construed as one and the same instrument.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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<PAGE> 13
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- ---------------------------------- ---------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By*: /s/ Paul Heldman
- ---------------------------------- --------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- ---------------------------------- ---------------------------------------
Name: Bruce Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ BRUCE M. GACK By: /s/ Paul Heldman
- ---------------------------------- ---------------------------------------
Secretary Name: Paul Heldman
Title: President
- ----------------------------------
*Signing as duly authorized officer for each such Guarantor.
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<PAGE> 14
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /s/ Keith C. Larson
- ---------------------------------- ---------------------------------------
Name: Keith C. Larson
Title: Vice President Secretary
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<PAGE> 15
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve McMillan
- ---------------------------------- ----------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 16
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ William Sicking
- ---------------------------------- ---------------------------------------
Assistant Secretary Name: William Sicking
Title: Trust Officer
-14-
<PAGE> 17
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and ____________ of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 18
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
----------------------------------------
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
----------------------------------------
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<PAGE> 19
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the ________ day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
----------------------------------------
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<PAGE> 20
SCHEDULE I
GUARANTORS
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
-18-
<PAGE> 21
Name of Guarantor State of Organization
- --------------------------------------------------------------------------------
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
<PAGE> 1
Exhibit 4.9
================================================================================
THE KROGER CO.
and certain of its Subsidiaries, as Guarantors
TO
HARRIS TRUST AND SAVINGS BANK
Trustee
----------
SEVENTH SUPPLEMENTAL INDENTURE
Dated as of June 25, 1999
TO
INDENTURE
Dated as of April 1, 1992
----------
$250,000,000 9 7/8% Senior Subordinated Notes due 2002
$250,000,000 General Term Notes(SM), Series A
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE ONE
DEFINITIONS
<S> <C>
Section 101. Definitions..........................................................................................2
ARTICLE TWO
GUARANTEE
Section 201. Guarantee............................................................................................3
Section 202. Waiver of Demand.....................................................................................4
Section 203. Guarantee of Payment.................................................................................4
Section 204. No Discharge or Diminishment of Guarantee............................................................4
Section 205. Defenses of Company Waived...........................................................................5
Section 206. Continued Effectiveness..............................................................................5
Section 207. Subrogation..........................................................................................5
Section 208. Information..........................................................................................6
Section 209. Subordination........................................................................................6
Section 210. Termination..........................................................................................6
Section 211. Guarantees of other Indebtedness.....................................................................7
Section 212. Additional Guarantors................................................................................7
Section 213. Limitation of Guarantor's Liability..................................................................8
Section 214. Contribution from Other Guarantors...................................................................8
Section 215. No Obligation to Take Action Against the Company.....................................................8
Section 216. Dealing with the Company and Others..................................................................8
Section 217. Subordination of Guarantee...........................................................................9
ARTICLE THREE
SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. Guarantee Obligations Subordinated to Senior Indebtedness of Guarantors..............................9
Section 302. Payment Over of Proceeds Upon Dissolution, Etc.......................................................9
Section 303. No Payment When Senior Indebtedness in Default......................................................10
Section 304. Payment Permitted if no Default.....................................................................11
Section 305. Subrogation to Rights of Holders of Senior Indebtedness.............................................12
Section 306. Provisions Solely to Define Relative Rights.........................................................12
Section 307. Trustee to Effectuate Subordination.................................................................13
Section 308. No Waiver of Subordination Provisions...............................................................13
Section 309. Notice to Trustee...................................................................................13
Section 310. Reliance on Judicial Order or Certificate of Liquidating Agent......................................14
</TABLE>
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<PAGE> 3
<TABLE>
<S> <C>
Section 311. Trustee Not Fiduciary for Holders of Senior Indebtedness............................................14
Section 312. Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's Rights...............15
Section 313. Article Applicable to Paying Agents.................................................................15
Section 314. Authorization to File Claims; Reinstatement of Subordination........................................15
ARTICLE FOUR
MISCELLANEOUS
Section 401. Miscellaneous.......................................................................................16
</TABLE>
-ii-
<PAGE> 4
SEVENTH SUPPLEMENTAL INDENTURE, dated as of June 25, 1999,
among The Kroger Co., a corporation duly organized and existing under the laws
of the State of Ohio (herein called the "Company"), having its principal office
at 1014 Vine Street, Cincinnati, Ohio 45202, each of the guarantors signatory
hereto as set forth on the signature pages and Schedule I (collectively, the
"Guarantors") and Harris Trust and Savings Bank, an Illinois banking corporation
duly organized and existing under the laws of the State of Illinois, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of April 1, 1992 (as amended and supplemented, the
"Indenture") providing for the issuance from time to time of the Company's
unsecured debentures, notes or other evidences of indebtedness (herein and
therein called the "Securities"), to be issued in one or more series as in the
Indenture provided.
The Indenture has been supplemented by, among other
supplemental indentures, the Fourth Supplemental Indenture dated as of August 1,
1992 (the "Fourth Supplemental Indenture"), and the Sixth Supplemental
Indenture, dated as of April 8, 1993 (the "Sixth Supplemental Indenture"),
providing for the issuance of the no longer outstanding, $250,000,000 9 7/8%
Senior Subordinated Notes due 2002, and the $250,000,000 General Term Notes(SM),
Series A, respectively (collectively, the "Securities").
Each of the Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly authorized the execution and delivery of this Seventh
Supplemental Indenture.
Section 901(9) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture to make any other provisions with
respect to matters or questions arising under the Indenture, provided that such
action shall not adversely affect the interests of the Holders of Securities of
any series in any material respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Seventh Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities
issued thereunder.
All things necessary to make this Seventh Supplemental
Indenture a valid agreement of the Company and each of the Guarantors, and a
valid amendment of and supplement to the Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS SEVENTH SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
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DEFINITIONS
Section 101. DEFINITIONS.
For all purposes of this Seventh Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Seventh
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Seventh Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Seventh Supplemental Indenture.
(4) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by the Company or Fred Meyer,
Inc. and outstanding on the date of this Seventh Supplemental Indenture, and any
refinancing or other restructuring of any such agreement or facility.
(5) "Guarantee" has the meaning specified in Section 201.
(6) "Guaranteed Obligations" has the meaning specified in Section 201.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Notifying Holder" has the meaning specified in Section 303.
(9) "Payment Blockage Period" has the meaning specified in Section 303.
(10) "Senior Indebtedness" means, with respect to any Guarantor, the
principal of (and premium, if any) and interest on, and all other amounts
payable in respect of, (a) all
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Indebtedness of such Guarantor, whether outstanding on the date of this
Indenture or thereafter Incurred, (b) any obligations of such Guarantor under
interest rate swaps, caps, collars and similar arrangements, (c) any obligations
of such Guarantor under foreign currency hedges entered into in respect of any
such Indebtedness or obligation and (d) any amendments, renewals, extensions,
modifications, and refundings of any such Indebtedness or obligation, except (i)
any Indebtedness or obligation owed to a Subsidiary, (ii) any Indebtedness or
obligation which by the terms of the instrument creating or evidencing the same
is not superior in right of payment to such Guarantor's Guarantee, (iii) any
Indebtedness or obligation which is subordinated or junior in any respect to any
other Indebtedness or obligation of such Guarantor, and (iv) any Indebtedness or
obligation constituting a trade account payable of such Guarantor. Any
obligation under any Senior Indebtedness shall continue to constitute Senior
Indebtedness despite a determination that the Incurrence of such obligation by a
Guarantor was a preference under Section 547(b) of Title 11 of the United States
Code (or any successor thereto) or was a fraudulent conveyance or transfer under
Federal or state law.
ARTICLE TWO
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GUARANTEE
Section 201. GUARANTEE.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of the Indenture or
the Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Guaranteed Obligations") will be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Guaranteed Obligations,
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise. If the Company shall fail to pay when due, or to
perform, any Guaranteed Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Guaranteed
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Obligations of the Guarantor hereunder in the same manner and to the same extent
as the Guaranteed Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Guaranteed Obligations may be accelerated as provided in Article
Five of the Indenture for the purposes of its Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the Guaranteed Obligations, and (b) in the event of any acceleration of such
Guaranteed Obligations as provided in Article Five of the Indenture, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Guarantor for the purposes of its Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Guaranteed Obligations, and also waives notice of acceptance of its
Guarantee and notice of protest for nonpayment.
Section 203. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee
constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Guaranteed
Obligations.
Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 210 of this Seventh Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever
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by reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each of the Guarantors hereunder shall not be discharged or
impaired or otherwise affected by the failure of the Trustee or any Holder of
the Securities to assert any claim or demand or to enforce any remedy under the
Indenture or the Securities, any other guarantee or any other agreement, by any
waiver or modification of any provision of any thereof, by any default, failure
or delay, willful or otherwise, in the performance of the Guaranteed
Obligations, or by any other act or omission that may or might in any manner or
to any extent vary the risk of any Guarantor or that would otherwise operate as
a discharge of any Guarantor as a matter of law or equity (other than the
indefeasible payment in full in cash of all the Guaranteed Obligations).
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Company, other than final and indefeasible payment in
full in cash of the Guaranteed Obligations. Each of the Guarantors waives any
defense arising out of any such election even though such election operates to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of each of the Guarantors against the Company or any security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Seventh Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Guaranteed
Obligation is rescinded or must otherwise be restored by the Trustee or any
Holder of the Securities upon the bankruptcy or reorganization of the Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any Guaranteed Obligation when and as the same shall become due,
whether at maturity, by acceleration, after notice of prepayment or otherwise,
each of the Guarantors hereby promises to and will, upon receipt of written
demand by the Trustee or any Holder of the Securities, forthwith pay, or cause
to be paid, to the Holders in cash the amount of such unpaid Guaranteed
Obligations, and thereupon the Holders shall, assign (except to the extent that
such assignment would render a Guarantor a "creditor" of the Company within the
meaning of Section 547 of Title 11 of the United States Code as now in effect or
hereafter amended or any comparable provision of any successor statute) the
amount of
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the Guaranteed Obligations owed to it and paid by such Guarantor pursuant to
this Guarantee to such Guarantor, such assignment to be PRO RATA to the extent
the Guaranteed Obligations in question were discharged by such Guarantor, or
make such other disposition thereof as such Guarantor shall direct (all without
recourse to the Holders, and without any representation or warranty by the
Holders). If (a) a Guarantor shall make payment to the Holders of all or any
part of the Guaranteed Obligations and (b) all the Guaranteed Obligations and
all other amounts payable under this Seventh Supplemental Indenture shall be
indefeasibly paid in full, the Trustee will, at such Guarantor's request,
execute and deliver to such Guarantor appropriate documents, without recourse
and without representation or warranty, necessary to evidence the transfer by
subrogation to such Guarantor of an interest in the Guaranteed Obligations
resulting from such payment by such Guarantor.
Section 208. INFORMATION.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Guaranteed Obligations to the
Trustee; PROVIDED, HOWEVER, that any right of subrogation that such Guarantor
may have pursuant to this Seventh Supplemental Indenture is subject to Section
207 hereof.
Section 210. TERMINATION.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Seventh Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Service and Standard & Poor's Ratings
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the
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assets of such Guarantor, which sale or other disposition is otherwise in
compliance with the terms of the Indenture; provided, however, that such
Guarantor shall not be released and discharged from its obligations under this
Seventh Supplemental Indenture and its Guarantee if, upon consummation of such
sale, exchange, transfer or other disposition (by merger or otherwise), such
Guarantor remains or becomes a guarantor under any Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Seventh Supplemental Indenture and its
Guarantee.
Section 211. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such guarantor, provisions similar to those set forth in Section
210 hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become a Guarantor under this Seventh Supplemental Indenture, if it has not
already done so or unless the Guarantor is prohibited from doing so by
applicable law or a provision of a contract to which it is a party or by which
it is bound.
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
by such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Title 11 of the United States Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
state law. To effectuate the foregoing intention, the Holders and such Guarantor
hereby irrevocably agree that the obligations of such Guarantor under
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<PAGE> 11
this Seventh Supplemental Indenture and its Guarantee shall be limited to the
maximum amount which, after giving effect to all other contingent and fixed
liabilities of such Guarantor, and after giving effect to any collections from
or payments made by or on behalf of, any other Guarantor in respect of the
obligations of such Guarantor under its Guarantee or pursuant to its
contribution obligations under this Seventh Supplemental Indenture, will result
in the obligations of such Guarantor under its Guarantee not constituting such
fraudulent transfer or conveyance.
Section 214. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
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<PAGE> 12
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 217. SUBORDINATION OF GUARANTEE.
The obligations of each Guarantor to the Holders of the
Securities and to the Trustee pursuant to the Guarantee and this Indenture are
expressly subordinate and subject in right of payment to the prior payment in
full in cash of all Senior Indebtedness of such Guarantor, to the extent and in
the manner provided in Article Three.
ARTICLE THREE
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SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. GUARANTEE OBLIGATIONS SUBORDINATED TO SENIOR INDEBTEDNESS OF
GUARANTORS.
Each Guarantor covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees, that, to the
extent and in the manner hereinafter set forth in this Article, the Indebtedness
represented by the Guarantee of such Guarantor, including the obligations of
such Guarantor in respect of the payment of the principal of (and premium, if
any) and interest on each and all of the Securities, is hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
Senior Indebtedness of such Guarantor.
Section 302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any Guarantor or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of such Guarantor, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the benefit
of creditors or any other marshaling of assets and liabilities of such
Guarantor, then and in any such event the holders of Senior Indebtedness of such
Guarantor shall be entitled to receive payment in full in cash of all amounts
due or to become due on or in respect of all Senior Indebtedness of such
Guarantor before the Holders of the Securities are entitled to receive any
payment in respect of such Guarantor's Guarantee, including on account of
principal of (or premium, if any) or interest on the Securities, and to that end
the holders of Senior Indebtedness of such Guarantor shall be entitled to
receive, for application to the payment of all Senior Indebtedness of such
Guarantor remaining unpaid (to the extent necessary to pay all
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Senior Indebtedness of such Guarantor in full, after giving effect to any
concurrent payment or distribution to or for the holders of Senior
Indebtedness), any payment or distribution of any kind or character, whether in
cash, property or securities, including any such payment or distribution which
may be payable or deliverable by reason of the payment of any other Indebtedness
of such Guarantor being subordinated to the payment of the Guarantee of such
Guarantor, which may be payable or deliverable in respect of such Guarantee in
any such case, proceeding, dissolution, liquidation or other winding up or
event.
In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of any Guarantor of any kind or character,
whether in cash, property or securities, including any such payment or
distribution which may be payable or deliverable by reason of the payment of any
other Indebtedness of such Guarantor being subordinated to the payment of the
Guarantee of such Guarantor, before all Senior Indebtedness of such Guarantor is
paid in full, then and in such event such payment or distribution shall be held
in trust by any such Holder for the holders of Senior Indebtedness of such
Guarantor, and if such fact shall, at or prior to the time of such payment or
distribution, have been made known to the Trustee, shall be held by the Trustee
in a separate account, and shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent
or other Person making payment or distribution of assets of such Guarantor for
application to the payment of all Senior Indebtedness of such Guarantor
remaining unpaid, to the extent necessary to pay all Senior Indebtedness in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Indebtedness of such Guarantor.
The consolidation of any Guarantor with, or the merger of any
Guarantor into, another Person or the liquidation or dissolution of any
Guarantor following the sale, assignment, conveyance or transfer of its
properties and assets substantially as an entirety to another Person upon the
terms and conditions set forth in Article Eight of the Indenture shall not be
deemed a dissolution, winding up, liquidation, reorganization, assignment for
the benefit of creditors or marshaling of assets and liabilities of such
Guarantor for the purposes of this Section 302 if the Person formed by such
consolidation or into which such Guarantor is merged or the Person which
acquires by sale, assignment, conveyance or transfer such properties and assets
substantially as an entirety, as the case may be, shall, as a part of such
consolidation, merger, sale, assignment, conveyance or transfer, comply with the
conditions set forth in Article Eight of the Indenture.
Section 303. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.
No Guarantor may make any payments in respect of its
Guarantee, including any payment in respect of principal of, premium, if any, or
interest on the Securities if (i) any Senior Indebtedness of such Guarantor is
not paid when due and such
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default is not cured or waived, (ii) any other event of default on Senior
Indebtedness of such Guarantor occurs and the maturity of such Senior
Indebtedness is accelerated in accordance with its terms and such acceleration
is not rescinded or (iii) judicial proceedings shall be pending with respect to
such default in payment or event of default. During the continuance of any
default (other than a default in payment or any other event of default and
acceleration as described in the preceding sentence) with respect to any Senior
Indebtedness, upon the receipt by the Trustee and any Guarantor of written
notice thereof from any holder of such Senior Indebtedness or a representative
of such holder (each a "Notifying Holder"), such Guarantor may not during the
period (the "Payment Blockage Period") commencing on the date of such receipt of
such written notice and ending on the earlier of (i) the date on which such
event of default shall have been cured or waived or cease to exist or all
obligations of each such Guarantor in respect of such Senior Indebtedness shall
have been discharged and (ii) the 179th day after the date of the receipt of
such notice, take any action which would be prohibited by the first sentence of
this Section if any Senior Indebtedness of such Guarantor had not been paid. Any
number of such notices may be given; PROVIDED, HOWEVER, that during any 360-day
period the aggregate of all Payment Blockage Periods shall not exceed 179 days
and there shall be a period of at least 181 consecutive days in each 360-day
period when no Payment Blockage Period is in effect. For all purposes of this
Section 303, no default which existed or was continuing on the date of the
commencement of any Payment Blockage Period and was known to a Notifying Holder
shall be, or be made, the basis for the commencement of a second Payment
Blockage Period by the Notifying Holder, whether or not within a period of 360
consecutive days, unless such default shall have been cured or waived for a
period of not less than 90 consecutive days.
In the event that, notwithstanding the foregoing, any
Guarantor shall make any payment to the Trustee or the Holder of any Security
prohibited by the foregoing provisions of this Section, then and in such event
such payment shall be held in trust by any such Holder for the holders of Senior
Indebtedness of such Guarantor, and if such fact shall, at or prior to the time
of such payment, have been made known to the Trustee, shall be held by the
Trustee in a separate account, and shall be paid over and delivered forthwith to
such Guarantor.
The provisions of this Section shall not apply to any payment
with respect to which Section 302 would be applicable.
Section 304. PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article or elsewhere in this
Indenture or in any Guarantee or any Securities shall prevent (a) any Guarantor,
at any time except during the pendency of any case, proceeding, dissolution,
liquidation or other winding up, assignment for the benefit of creditors or
other marshaling of assets and liabilities of such Guarantor referred to in
Section 302 or under the conditions described in Section 303,
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<PAGE> 15
from making payments at any time under its Guarantee, including of principal of,
premium, if any, or interest on the Securities or (b) the application by the
Trustee of any money deposited with it hereunder to the payment of or on account
of the principal of or interest on the Securities or the retention of such
payment by the Holders, if, at the time of such application by the Trustee, it
did not have written notice as provided in Section 309, of any event prohibiting
such application.
Section 305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the payment in full of all Senior Indebtedness of
each Guarantor, the Holders of the Securities shall be subrogated to the extent
of the payments or distributions made to the holders of such Senior Indebtedness
of such Guarantor pursuant to the provisions of this Article to the rights of
the holders of such Senior Indebtedness to receive payments and distributions of
cash, property and securities applicable to the Senior Indebtedness of such
Guarantor until the principal of and interest on the Securities shall be paid in
full. For purposes of such subrogation, no payments or distributions to which
the holders of the Senior Indebtedness of any Guarantor or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among such Guarantor, its
creditors other than holders of its Senior Indebtedness and the Holders of the
Securities, be deemed to be a payment or distribution by such Guarantor to or on
account of the Senior Indebtedness of such Guarantor.
Section 306. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the Holders of the Securities on
the one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in the Indenture or in the Securities is
intended to or shall (a) impair, as among any Guarantor, its creditors and the
Holders of the Securities, the obligation of such Guarantor, which is absolute
and unconditional (and which, subject to the rights under this Article of the
holders of Senior Indebtedness of such Guarantor, is intended to rank equally
with all other general obligations of such Guarantor), to pay to the Holders of
the Securities the principal of (and premium, if any) and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against any Guarantor of the
Holders of the Securities and creditors of such Guarantor other than the holders
of Senior Indebtedness of such Guarantor; or (c) prevent the Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under the Indenture, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.
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Section 307. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate, as between the Holders and the holders of Senior
Indebtedness, the subordination provided for in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes.
Section 308. NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior
Indebtedness of any Guarantor to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of such Guarantor or by any act or failure to act, in good faith, by
any such holder, or by any non-compliance by such Guarantor with the terms,
provisions and covenants of the Indenture, regardless of any knowledge thereof
any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (i) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness, or otherwise amend or supplement in any manner Senior
Indebtedness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding; (ii) sell, exchange, release or otherwise
deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any Person liable in any manner for the collection
of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights
against the Company and any other Person.
Section 309. NOTICE TO TRUSTEE.
Each Guarantor shall give prompt written notice to the Trustee
of any fact known to such Guarantor which would prohibit the making of any
payment to or by the Trustee in respect of the Securities. Notwithstanding the
provisions of this Article or any other provision of the Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until the Trustee shall have received written notice
thereof from any Guarantor, any Holder, any Paying Agent, any holder of any
class of Senior Indebtedness or any Notifying Holder, who shall have been
certified by any Guarantor or otherwise established to the reasonable
satisfaction of the Trustee to be such holder, or from any trustee therefor;
and, prior to the receipt of any such written notice, the Trustee, subject to
the provisions of Section 601 of the Indenture, shall be
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<PAGE> 17
entitled in all respects to assume that no such facts exist; PROVIDED, HOWEVER,
that if the Trustee shall not have received the notice provided for in this
Section at least 2 Business Days prior to the date upon which by the terms
hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of (or premium, if any) or interest on
any Security), then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such money and to
apply the same to the purpose for which such money was received and shall not be
affected by any notice to the contrary which may be received by it within 2
Business Days prior to such date.
Subject to the provisions of Section 601 of the Indenture, the
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a trustee
therefor) to establish that such notice has been given by a holder of Senior
Indebtedness (or a trustee therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
Section 310. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
Upon any payment or distribution of assets of any guarantor
referred to in this Article, the Trustee, subject to the provisions of Section
601 of the Indenture, and the Holders of the Securities shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to the Trustee or to the Holders of
Securities, for the purpose of ascertaining the Person entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and
other Indebtedness of such Guarantor, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
Section 311. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR INDEBTEDNESS.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness and shall not be liable to any such holders
if it shall in good faith
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<PAGE> 18
mistakenly pay over or distribute to Holders of Securities or to any Guarantor
or to any other Person cash, property or securities to which any holders of
Senior Indebtedness of such Guarantor shall be entitled by virtue of this
Article or otherwise.
Section 312. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR
INDEBTEDNESS; PRESERVATION OF TRUSTEE'S RIGHTS..
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 607 of the Indenture.
Section 313. ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; PROVIDED,
HOWEVER, that this Section 313 shall not apply to the Company or any affiliate
of the Company if it or such Affiliate acts as Paying Agent.
Section 314. AUTHORIZATION TO FILE CLAIMS; REINSTATEMENT OF SUBORDINATION.
(a) Each Notifying Holder is hereby irrevocably authorized and
empowered (in its own name or in the name of the Holders or the Trustee or
otherwise), but shall have no obligation, to file claims and proofs of claim in
respect of the Securities in proceedings referred to in Section 302 in the event
such claims or proofs of claim have not been filed prior to 30 days before such
filings would be barred.
(b) The provisions of this Article Three shall continue to be
effective or be reinstated, as the case may be, if at any time any payment of
any obligations in respect of any Senior Indebtedness is rescinded or must
otherwise be returned by any holder of such Senior Indebtedness or any other
Lender under any Bank Agreement upon the insolvency, bankruptcy or
reorganization of any Guarantor, all as though such payment had not been made,
PROVIDED, HOWEVER, that this paragraph (b) shall only apply to payments which
had been so rescinded or required to be returned as a result of a determination
that such payment was a preference under Section 547(b) of Title 11 of the
United States Code (or any successor thereto) or was a fraudulent conveyance or
fraudulent transfer under Federal or State law.
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<PAGE> 19
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Seventh Supplemental Indenture, and agrees to perform
the same upon the terms and conditions of the Indenture, as supplemented by this
Seventh Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Seventh Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Seventh Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
(d) All covenants and agreements in this Seventh Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Seventh Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Seventh Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Seventh
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Seventh
Supplemental Indenture as so modified or excluded, as the case may be.
(h) This Seventh Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
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<PAGE> 20
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Seventh Supplemental Indenture
shall be deemed to be incorporated in, and made a part of, the Indenture; and
the Indenture, as supplemented by this Seventh Supplemental Indenture, shall be
read, taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE> 21
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
Attest: THE KROGER CO.
/s/ Bruce M. Gack By: /s/ Paul Heldman
- ------------------------- ----------------------------------------
Assistant Secretary Name: Paul Heldman
Title: Senior Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
/s/ Bruce M. Gack By* : /s/ Paul Heldman
- ------------------------- ----------------------------------------
(Assistant) Secretary Name: Paul Heldman
Title: Vice President
Attest: VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By: /s/ Bruce M. Gack
- ------------------------- ----------------------------------------
Name: Bruce Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Guarantor of the Securities
/s/ Bruce M. Gack By: /s/ Paul Heldman
- ------------------------- ----------------------------------------
Secretary Name: Paul Heldman
Title: President
- ----------------
* Signing as duly authorized officer for each such Guarantor.
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<PAGE> 22
Attest: RICHIE'S, INC.,
as Guarantor of the Securities
By: /s/ Keith C. Larson
- ------------------------- ----------------------------------------
Name: Keith C. Larson
Title: Vice President Secretary
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<PAGE> 23
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
By: /s/ Steve Mcmillan
- -------------------------- ------------------------------------------
Name: Steve McMillan
Title: Vice President and Secretary
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<PAGE> 24
Attest: HARRIS TRUST AND SAVINGS BANK,
as Trustee
By:
- ----------------------------- ------------------------------------------
Assistant Secretary Name:
Title:
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<PAGE> 25
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the _____ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto and ____________ of Kroger
Dedicated Logistics Co., corporations described in and which executed the
foregoing instrument; that he knows the seals of said corporations; that the
seals affixed to said instrument are such corporate seals; that they were so
affixed by authority of the Boards of Directors of said corporations, and that
he signed his name thereto by like authority.
------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the ____ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
------------------------
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<PAGE> 26
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the ____ day of June, 1999, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
------------------------
STATE OF _________ )
) ss.:
COUNTY OF _______ )
On the ____ day of June, 1999, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
------------------------
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<PAGE> 27
STATE OF __________ )
) ss.:
COUNTY OF ________ )
On the ____ day of June, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he/she is a _____________ of Harris Trust and Savings Bank, one of the
corporations described in and which executed the foregoing instrument; that
he/she knows the seal of said corporation; that the seal affixed to said
instrument is such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he/she signed his name thereto
by like authority.
------------------------
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<PAGE> 28
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
-25-
<PAGE> 29
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
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<PAGE> 1
Exhibit 4.10
================================================================================
FRED MEYER, INC.,
and certain Guarantors
TO
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
----------
SECOND SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of March 11, 1998
----------
$250,000,000 7.150% Notes due March 1, 2003
$750,000,000 7.375% Notes due March 1, 2005
$750,000,000 7.450% Notes due March 1, 2008
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
Section 101. Definitions..................................................... 2
ARTICLE TWO
ADDITIONAL GUARANTEE
Section 201. ADDITIONAL GUARANTEE............................................ 3
Section 202. WAIVER OF DEMAND................................................ 4
Section 203. ADDITIONAL GUARANTEE OF PAYMENT................................. 4
Section 204. NO DISCHARGE OR DIMINISHMENT OF ADDITIONAL GUARANTEE............ 4
Section 205. DEFENSES OF COMPANY WAIVED...................................... 4
Section 206. CONTINUED EFFECTIVENESS......................................... 5
Section 207. SUBROGATION..................................................... 5
Section 208. INFORMATION..................................................... 6
Section 209. SUBORDINATION................................................... 6
Section 210. TERMINATION..................................................... 6
Section 211. ADDITIONAL GUARANTEES OF OTHER INDEBTEDNESS..................... 7
Section 212. ADDITIONAL GUARANTORS........................................... 7
Section 213. LIMITATION OF ADDITIONAL GUARANTOR'S LIABILITY.................. 7
Section 214. CONTRIBUTION FROM OTHER ADDITIONAL GUARANTORS................... 7
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY................ 8
Section 216. Dealing with the Company and Others............................. 8
-i-
<PAGE> 3
ARTICLE THREE
MISCELLANEOUS
Section 301. MISCELLANEOUS................................................... 9
-ii-
<PAGE> 4
SECOND SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this "Second
Supplemental Indenture"), among Fred Meyer, Inc., a corporation duly organized
and existing under the laws of the State of Delaware (herein called the
"Company") having its principal office at 3800 SE 22nd Avenue, Portland, Oregon
97202 each of the guarantors signatory hereto as set forth on the signature
pages and Schedule I (collectively, the "Pre-Existing Guarantors"), each of the
additional guarantors signatory hereto as set forth on the signature pages and
Schedule II (collectively, the "Additional Guarantors" and collectively with the
Pre-Existing Guarantors, the "Guarantors"), and First National Bank of Chicago,
a national banking association, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the Trustee an
Indenture dated as of March 11, 1998 (as amended and supplemented, the
"Indenture") providing for the issuance from time to time of the Company's
unsecured debentures, notes or other evidences of indebtedness (herein and
therein called the "Securities"), to be issued in one or more series as in the
Indenture provided.
The Indenture has been supplemented by the First Supplemental Indenture,
dated as of March 11, 1998 (the "First Supplemental Indenture"), providing for
the issuance of the $250,000,000 7.150% Notes due March 1, 2003, the
$750,000,000 7.375% Notes due March 1, 2005, and the $750,000,000 7.450% Notes
due March 1, 2008 (collectively, the "Securities").
Each of the Additional Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Additional Guarantors has duly authorized the execution and delivery of
this Second Supplemental Indenture.
Section 901(10) of the Indenture provides that, without the consent of any
Holders, the Company, when authorized by a Board Resolution, the Guarantors and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture to make any other provisions with
respect to matters or questions arising under the Indenture, the Securities, or
any Guarantee provided that such action shall not adversely affect the rights of
the Holders of Securities of any series in any material respect.
The Company and the Guarantors, pursuant to the foregoing authority,
propose in and by this Second Supplemental Indenture to amend and supplement the
Indenture in certain respects with respect to the Securities.
All things necessary to make this Second Supplemental Indenture a valid
agreement of the Company and each of the Guarantors, and a valid amendment of,
and supplement to the Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each of the
Guarantors hereby covenants and agrees with the Trustee and its successor or
successors in said trust under the Indenture, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. DEFINITIONS.
For all purposes of this Second Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Second
Supplemental Indenture and, where so specified, to the Articles and
Sections of the Indenture as supplemented by this Second Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Second Supplemental Indenture.
(4) "Additional Guarantee" has the meaning specified in Section 201.
(5) "Additional Guaranteed Obligations" has the meaning specified in
Section 201.
(6) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of
credit by banks or other credit institutions, entered into by The Kroger
Co. or the Company. and outstanding on the date of this Second Supplemental
Indenture, and any refinancing or other restructuring of any such agreement
or facility.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
-2-
<PAGE> 6
ARTICLE TWO
ADDITIONAL GUARANTEE
Section 201. ADDITIONAL GUARANTEE.
Each Additional Guarantor hereby jointly and severally fully and
unconditionally guarantees (each an "Additional Guarantee") to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of the
Indenture or the Securities or the obligations of the Company or any other
Additional Guarantor to the Holders or the Trustee hereunder or thereunder, that
(a) the principal of, premium, if any, and interest on the Securities will be
duly and punctually paid in full when due, whether at maturity, upon redemption,
by acceleration or otherwise, and interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Securities and all other
obligations of the Company or the Additional Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Additional Guaranteed Obligations") will
be promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Additional Guaranteed Obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at Stated Maturity, by acceleration or otherwise.
If the Company shall fail to pay when due, or to perform, any Additional
Guaranteed Obligations, for whatever reason, each Additional Guarantor shall be
obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Additional Guarantee, and shall
entitle the Holders of Securities to accelerate the Additional Guaranteed
Obligations of the Additional Guarantor hereunder in the same manner and to the
same extent as the Additional Guaranteed Obligations of the Company.
Each Additional Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not an Additional Guarantee is affixed to any
particular Security, or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a Guarantor.
Each Additional Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Additional Guaranteed Obligations may be accelerated as provided
in Article Five of the Indenture for the purposes of its Additional Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Additional Guaranteed Obligations, and (b) in the
event of any acceleration of such Additional
-3-
<PAGE> 7
Guaranteed Obligations as provided in Article Five of the Indenture, such
Additional Guaranteed Obligations (whether or not due and payable) shall
forthwith become due and payable by such Additional Guarantor for the purposes
of its Additional Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the Additional
Guarantors waives presentment to, demand of payment from and protest of any of
the Additional Guaranteed Obligations, and also waives notice of acceptance of
its Additional Guarantee and notice of protest for nonpayment.
Section 203. ADDITIONAL GUARANTEE OF PAYMENT.
Each of the Additional Guarantors further agrees that its Additional
Guarantee constitutes a guarantee of payment when due and not of collection, and
waives any right to require that any resort be had by the Trustee or any Holder
of the Securities to the security, if any, held for payment of the Additional
Guaranteed Obligations.
Section 204. NO DISCHARGE OR DIMINISHMENT OF ADDITIONAL GUARANTEE.
Subject to Section 210 of this Second Supplemental Indenture, the
obligations of each of the Additional Guarantors hereunder shall not be subject
to any reduction, limitation, impairment or termination for any reason (other
than the indefeasible payment in full in cash of the Additional Guaranteed
Obligations), including any claim of waiver, release, surrender, alteration or
compromise of any of the Additional Guaranteed Obligations, and shall not be
subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Additional Guaranteed Obligations or otherwise. Without limiting the generality
of the foregoing, the obligations of each of the Additional Guarantors hereunder
shall not be discharged or impaired or otherwise affected by the failure of the
Trustee or any Holder of the Securities to assert any claim or demand or to
enforce any remedy under the Indenture or the Securities, any other guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Additional Guaranteed Obligations, or by any other act or
omission that may or might in any manner or to any extent vary the risk of any
Additional Guarantor or that would otherwise operate as a discharge of any
Additional Guarantor as a matter of law or equity (other than the indefeasible
payment in full in cash of all the Additional Guaranteed Obligations).
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the Additional
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Additional
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the
-4-
<PAGE> 8
Company, other than final and indefeasible payment in full in cash of the
Additional Guaranteed Obligations. Each of the Additional Guarantors waives any
defense arising out of any such election even though such election operates to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of each of the Additional Guarantors against the Company or any
security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Second Supplemental Indenture, each of the
Additional Guarantors further agrees that its Additional Guarantee hereunder
shall continue to be effective or be reinstated, as the case may be, if at any
time payment, or any part thereof, of principal of or interest on any Additional
Guaranteed Obligation is rescinded or must otherwise be restored by the Trustee
or any Holder of the Securities upon the bankruptcy or reorganization of the
Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any other right of
each of the Additional Guarantors by virtue hereof, upon the failure of the
Company to pay any Additional Guaranteed Obligation when and as the same shall
become due, whether at maturity, by acceleration, after notice of prepayment or
otherwise, each of the Additional Guarantors hereby promises to and will, upon
receipt of written demand by the Trustee or any Holder of the Securities,
forthwith pay, or cause to be paid, to the Holders in cash the amount of such
unpaid Additional Guaranteed Obligations, and thereupon the Holders shall,
assign (except to the extent that such assignment would render an Additional
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Additional
Guaranteed Obligations owed to it and paid by such Additional Guarantor pursuant
to this Additional Guarantee to such Additional Guarantor, such assignment to be
PRO RATA to the extent the Additional Guaranteed Obligations in question were
discharged by such Additional Guarantor, or make such other disposition thereof
as such Additional Guarantor shall direct (all without recourse to the Holders,
and without any representation or warranty by the Holders). If (a) an Additional
Guarantor shall make payment to the Holders of all or any part of the Additional
Guaranteed Obligations and (b) all the Additional Guaranteed Obligations and all
other amounts payable under this Second Supplemental Indenture shall be
indefeasibly paid in full, the Trustee will, at such Additional Guarantor's
request, execute and deliver to such Additional Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to evidence
the transfer by subrogation to such Additional Guarantor of an interest in the
Additional Guaranteed Obligations resulting from such payment by such Additional
Guarantor.
-5-
<PAGE> 9
Section 208. INFORMATION.
Each of the Additional Guarantors assumes all responsibility for being and
keeping itself informed of the Company's financial condition and assets, and of
all other circumstances bearing upon the risk of nonpayment of the Additional
Guaranteed Obligations and the nature, scope and extent of the risks that each
of the Additional Guarantors assumes and incurs hereunder, and agrees that the
Trustee and the Holders of the Securities will have no duty to advise the
Additional Guarantors of information known to it or any of them regarding such
circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Additional Guarantor of any sums to the Holders, as
provided above, all rights of such Additional Guarantor against the Company,
arising as a result thereof by way of right of subrogation or otherwise, shall
in all respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Additional Guaranteed
Obligations to the Trustee; PROVIDED, HOWEVER, that any right of subrogation
that such Additional Guarantor may have pursuant to this Second Supplemental
Indenture is subject to Section 207 hereof.
Section 210. TERMINATION.
An Additional Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Second Supplemental Indenture and its Additional
Guarantee without any action required on the part of the Trustee or any Holder
if such release and discharge will not result in any downgrade in the rating
given to the Securities by Moody's Investors Service and Standard and Poor's
Ratings Services:
(a) upon any sale, exchange, transfer or other disposition (by merger or
otherwise) of all of the Capital Stock of an Additional Guarantor or all, or
substantially all, of the assets of such Additional Guarantor, which sale or
other disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Additional Guarantor shall not be released and
discharged from its obligations under this Second Supplemental Indenture and its
Additional Guarantee if, upon consummation of such sale, exchange, transfer or
other disposition (by merger or otherwise), such Additional Guarantor remains or
becomes a guarantor under any Credit Facility; or
(b) at the request of the Company, at any time that none of the Credit
Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Additional Guarantor not
so released will remain
-6-
<PAGE> 10
liable for the full amount of the principal of, premium, if any, and interest
on the Securities provided in the Indenture and its Guarantee.
Section 211. ADDITIONAL GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Additional Guarantors, the
Company will cause each of its Subsidiaries that becomes a guarantor in respect
of (i) any Indebtedness of the Company which is outstanding on the date hereof
and (ii) any Indebtedness incurred by the Company after the date hereof (other
than in respect of asset-backed securities), to include in any guarantee given
by any such guarantor provisions similar to those set forth in Section 210
hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a guarantor in
respect of any Indebtedness of the Company following the date hereof to execute
and deliver a supplemental indenture pursuant to which it will become an
Additional Guarantor under this Second Supplemental Indenture, if it has not
already done so or unless the Additional Guarantor is prohibited from doing so
by applicable Law or a provision of a contract to which it is a party or by
which it is bound.
Section 213. LIMITATION OF ADDITIONAL GUARANTOR'S LIABILITY.
Each Additional Guarantor, other than The Kroger Co., and by its acceptance
hereof each Holder, hereby confirms that it is the intention of all such parties
that the Additional Guarantee by such Additional Guarantor not constitute a
fraudulent transfer or conveyance for purposes of Title 11 of the United States
Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or any similar Federal of state law. To effectuate the foregoing intention, the
Holders and such Additional Guarantor hereby irrevocably agree that the
obligations of such Additional Guarantor under this Second Supplemental
Indenture and its Additional Guarantee shall be limited to the maximum amount
which, after giving effect to all other contingent and fixed liabilities of such
Additional Guarantor, and after giving effect to any collections from or
payments made by or on behalf of, any other Additional Guarantor in respect of
the obligations of such Additional Guarantor under its Additional Guarantee or
pursuant to its contribution obligations under this Second Supplemental
Indenture, will result in the obligations of such Additional Guarantor under its
Additional Guarantee not constituting such fraudulent transfer or conveyance.
Section 214. CONTRIBUTION FROM OTHER ADDITIONAL GUARANTORS.
Each Additional Guarantor that makes a payment or distribution under its
Additional Guarantee shall be entitled to a contribution from each other
Additional Guarantor in a pro rata amount based on the net assets of each
Additional Guarantor,
-7-
<PAGE> 11
determined in accordance with generally accepted accounting principles in effect
in the United States of America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall have any
obligation to enforce or exhaust any rights or remedies or take any other steps
under any security for the Additional Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Additional Guarantors of their liabilities
and obligations under their Additional Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Additional
Guarantor hereunder and without the consent of or notice to any Additional
Guarantor, may:
(a) grant time, renewals, extensions, compromises, concessions, waivers,
releases, discharges and other indulgences to the Company or any other Person;
(b) take or abstain from taking security or collateral from the Company or
from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal with
or do any act or thing in respect of (with or without consideration) any and all
collateral, mortgages or other security given by the Company or any third party
with respect to the Additional Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security to such part of the Additional Guaranteed Obligations as the Holders
may see fit or change any such application in whole or in part from time to time
as the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to deal with, the
Company and all other Persons and any security as the Holders or the Trustee may
see fit.
-8-
<PAGE> 12
ARTICLE THREE
MISCELLANEOUS
Section 301. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture, as
supplemented by this Second Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Second Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Second Supplemental Indenture.
(c) Each of the Company, the Pre-Existing Guarantors and the Trustee makes
and reaffirms as of the date of execution of this Second Supplemental Indenture
all of its respective representations, covenants and agreements set forth in the
Indenture.
(d) All covenants and agreements in this Second Supplemental Indenture by
the Company, the Guarantors and the Trustee shall bind its respective successors
and assigns, whether so expressed or not.
(e) In case any provisions in this Second Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
(f) Nothing in this Second Supplemental Indenture, express or implied,
shall give to any Person, other than the parties hereto and their successors
under the Indenture and the Holders of the series of Securities created hereby,
any benefit or any legal or equitable right, remedy or claim under the
Indenture.
(g) If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act of 1939, as may be amended from time to time, that is
required under such Act to be a part of and govern this Second Supplemental
Indenture, the latter provision shall control. If any provision hereof modifies
or excludes any provision of such Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Second Supplemental Indenture
as so modified or excluded, as the case may be.
(h) This Second Supplemental Indenture shall be governed by and construed
in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect any and all
series of Securities created under the Indenture.
-9-
<PAGE> 13
(j) All provisions of this Second Supplemental Indenture shall be deemed to
be incorporated in, and made a part of, the Indenture; and the Indenture, as
supplemented by this Second Supplemental Indenture, shall be read, taken and
construed as one and the same instrument.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
-10-
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: FRED MEYER INC.
/s/ Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ---------------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
Bruce M. Gack By*: (Paul W. Heldman)
- ---------------------------------- --------------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: RICHIE'S INC., as Guarantor of the
Securities
By: (Keith C. Larson)
- ---------------------------------- ---------------------------------------
Name: Keith C. Larson
Title: Vice President
Attest: THE KROGER CO., as Additional Guarantor
of the Securities
/s/ Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ---------------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Senior Vice President
- ----------------------------------
*Signing as duly authorized officer for each such Guarantor.
-11-
<PAGE> 15
Attest:** Each of the Additional Guarantors Listed on
Schedule II hereto, as Additional Guarantor
of the Securities
/s/ Bruce M. Gack By**: (Paul W. Heldman)
- ---------------------------------- -------------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: HENPIL, INC., as Additional Guarantor
of the Securities
WYDIV, INC., as Additional Guarantor
of the Securities
By: (Steven McMillan)
- ---------------------------------- ---------------------------------------
Name: Steven McMillan
Title: Vice President
- ----------------------------------
**Signing as duly authorized officer for each such Additional Guarantor.
-12-
<PAGE> 16
Attest: VINE COURT ASSURANCE INCORPORATED,
as Additional Guarantor of the Securities
(Beth Van Oflen) By: (Bruce M. Gack)
- ---------------------------------- ---------------------------------------
Beth Van Oflen, Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO.,
as Additional Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- ---------------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: President
-13-
<PAGE> 17
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came Paul W. Heldman,
to me known, who, being by me duly sworn, did depose and say that he is Vice
President of Ralphe Grocery Company and Vice President of each of the Guarantors
Listed on Schedule I hereto and Vice President of each of the Additional
Guarantors listed on Schedule II hereto, and Senior Vice President of The Kroger
Co., and President of Kroger Dedicated Logistics Co., corporations described in
and which executed the foregoing instrument; that he knows the seals of said
corporations; that the seals affixed to said instrument are such corporate
seals; that they were so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
(Brenda R. Andes)
----------------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
STATE OF TEXAS )
) ss.:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came Steven McMillan,
to me known, who, being by me duly sworn, did depose and say that he is Vice
President of Henpil, Inc. and Wydiv, Inc., corporations described in and which
executed the foregoing instrument; that he knows the seal of said corporations;
that the seals affixed to said instrument are such corporate seals; that they
were so affixed by authority of the Boards of Directors of said corporations,
and that he signed his name thereto by like authority.
(Barbara Edwards)
----------------------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 20, 2001
<PAGE> 18
STATE OF TEXAS )
) ss.:
COUNTY OF EL PASO )
On the 30th day of July, 1999, before me personally came Keith C. Larson,
to me known, who, being by me duly sworn, did depose and say that he is Vice
President of Richie's, Inc., one of the corporations described in and which
executed the foregoing instrument; that he knows the seal of said corporation;
that the seal affixed to said instrument is such corporate seal; that it was
so affixed by authority of the Board of Directors of said corporation,
and that he signed his name thereto by like authority.
(Mercedes Flores)
----------------------------------------
Notary Public
Mercedes Flores [Notarial Seal]
Notary Public, State of Texas
My Commission Expires 10/23/99
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came Bruce M. Gack, to
me known, who, being by me duly sworn, did depose and say that he is Vice
President of Vine Court Assurance Incorporated, one of the corporations
described in and which executed the foregoing instrument; that he knows the
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
----------------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
<PAGE> 19
SCHEDULE I
GUARANTORS
Name of Guarantor State of Organization
- ----------------- ---------------------
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM Holding Corporation Delaware
FM Retail Services, Inc. Washington
FM, Inc. Utah
Fred Meyer Jewelers, Inc. Delaware
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Stores, Inc. Delaware
Grand Central, Inc. Utah
JH Properties, Inc. Washington
Merksamer Jewelers, Inc. California
Roundup Co. Washington
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smith's Food & Drug Centers, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Smitty's Supermarkets, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
QFC Sub, Inc. Washington
Quality Food Holdings, Inc. Delaware
Quality Food, Inc. Delaware
Second Story, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
<PAGE> 20
Name of Guarantor State of Organization
- ----------------- ---------------------
Food 4 Less GM, Inc. California
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Ralphs Grocery Company Delaware
<PAGE> 21
SCHEDULE II
ADDITIONAL GUARANTORS
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
<PAGE> 1
EXHIBIT 4.11
----------------------------------------------------------------------
RALPHS GROCERY COMPANY
and certain Guarantors
TO
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Trustee
----------
THIRD SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of June 1, 1995
----------
$520,326,000 10.45% Senior Notes due 2004
----------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS
<TABLE>
<CAPTION>
<S> <C> <C>
Section 101. Definitions....................................................2
-----------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE TWO
ADDITIONAL GUARANTEE
<S> <C> <C>
Section 201. Additional Guarantee...........................................3
--------------------
Section 202. Waiver of Demand...............................................4
----------------
Section 203. Additional Guarantee of Payment................................4
-------------------------------
Section 204. No Discharge or Diminishment of Additional Guarantee...........4
----------------------------------------------------
Section 205. Defenses of Company Waived.....................................5
--------------------------
Section 206. Continued Effectiveness........................................5
-----------------------
Section 207. Subrogation....................................................5
-----------
Section 208. Information....................................................6
-----------
Section 209. Subordination..................................................6
-------------
Section 210. Termination....................................................6
-----------
Section 211. Additional Guarantees of Other Indebtedness....................7
-------------------------------------------
Section 212. Additional Guarantors..........................................7
---------------------
Section 213. Limitation of Additional Guarantor's Liability.................7
----------------------------------------------
Section 214. Contribution from Other Guarantors.............................8
----------------------------------
Section 215. No Obligation to Take Action Against the Company...............8
------------------------------------------------
Section 216. Dealing with the Company and Others............................8
-----------------------------------
</TABLE>
ARTICLE THREE
-i-
<PAGE> 3
<TABLE>
<CAPTION>
MISCELLANEOUS
<S> <C> <C>
Section 301. Miscellaneous..................................................9
-------------
</TABLE>
-ii-
<PAGE> 4
THIRD SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this
"Third Supplemental Indenture"), among Ralphs Grocery Company, a Delaware
corporation having its principal office at 1100 West Artesia Boulevard, Compton,
California 90220 (herein called the "Company"), each of the guarantors signatory
hereto as set forth on the signature pages and on Schedule I (collectively, the
"Guarantors"), each of the additional guarantors signatory hereto as set forth
on the signature pages and Schedule II (collectively, the "Additional
Guarantors"), and Norwest Bank Minnesota, a national banking association, as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of June 1, 1995 (as amended and supplemented, the
"Indenture") providing for the issuance of the $520,326,000 10.45% Senior Notes
Due 2004 (the "Securities").
The Indenture has been supplemented by the First Supplemental
Indenture, dated as of June 14, 1995 (the "First Supplemental Indenture") and
the Second Supplemental Indenture dated as of February 26, 1998 (the "Second
Supplemental Indenture").
Each of the Additional Guarantors has duly authorized the
issuance of a guarantee of the Securities, as set forth herein, and to provide
therefor, each of the Additional Guarantors has duly authorized the execution
and delivery of this Third Supplemental Indenture.
Section 9.01(4) of the Indenture provides that, without the
notice to and consent of any Holders, the Company and the Guarantors, when
authorized by a Board Resolution, and the Trustee, together, may amend or
supplement the Indenture to make any other change that does not adversely affect
the rights of any Security holders in any material respect.
The Company, each of the Guarantors and each of the Additional
Guarantors, pursuant to the foregoing authority, propose in and by this Third
Supplemental Indenture to amend and supplement the Indenture in certain respects
with respect to the Securities.
All things necessary to make this Third Supplemental Indenture
a valid agreement of the Company, each of the Guarantors and each of the
Additional Guarantors, and a valid amendment of, and supplement to the
Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company, each of
the Guarantors and each of the Additional Guarantors hereby covenants and agrees
with the Trustee and its successor or successors in said trust under the
Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
Section 101. Definitions.
------------
For all purposes of this Third Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Third
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Third Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Third Supplemental Indenture.
(4) "Additional Guarantee" has the meaning specified in Section 201.
(5) "Additional Guaranteed Obligations" has the meaning specified in
Section 201.
(6) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by The Kroger Co. or Fred
Meyer, Inc. and outstanding on the date of this Third Supplemental Indenture,
and any refinancing or other restructuring of any such agreement or facility.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
-2-
<PAGE> 6
ARTICLE TWO
-----------
ADDITIONAL GUARANTEE
Section 201. Additional Guarantee.
---------------------
Each Additional Guarantor hereby jointly and severally fully
and unconditionally guarantees (each an "Additional Guarantee") to each Holder
of a Security authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
the Indenture or the Securities or the obligations of the Company or any other
Additional Guarantor to the Holders or the Trustee hereunder or thereunder, that
(a) the principal of, premium, if any, and interest on the Securities will be
duly and punctually paid in full when due, whether at maturity, upon redemption,
by acceleration or otherwise, and interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Securities and all other
obligations of the Company or the Additional Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Guaranteed Obligations") will be
promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Guaranteed Obligations, the same will be promptly paid
in full when due or performed in accordance with the terms of the extension or
renewal, whether at Stated Maturity, by acceleration or otherwise. If the
Company shall fail to pay when due, or to perform, any Guaranteed Obligations,
for whatever reason, each Additional Guarantor shall be obligated to pay, or to
perform or cause the performance of, the same immediately. An Event of Default
under the Indenture or the Securities shall constitute an event of default under
this Additional Guarantee, and shall entitle the Holders of Securities to
accelerate the Guaranteed Obligations of the Additional Guarantor hereunder in
the same manner and to the same extent as the Guaranteed Obligations of the
Company.
Each Additional Guarantor hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Additional Guarantor, the recovery of any judgment against the Company,
any action to enforce the same, whether or not an Additional Guarantee is
affixed to any particular Security, or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of an Additional
Guarantor.
Each Additional Guarantor further agrees that, as between it,
on the one hand, and the Holders of Securities and the Trustee, on the other
hand, (a) the maturity of the Guaranteed Obligations may be accelerated as
provided in Article Six of the Indenture
-3-
<PAGE> 7
for the purposes of its Additional Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Guaranteed Obligations, and (b) in the event of any acceleration of such
Guaranteed Obligations as provided in Article Six of the Indenture, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Additional Guarantor for the purposes of its Additional
Guarantee.
Section 202. Waiver of Demand.
----------------
To the fullest extent permitted by applicable law, each of the
Additional Guarantors waives presentment to, demand of payment from and protest
of any of the Guaranteed Obligations, and also waives notice of acceptance of
its Additional Guarantee and notice of protest for nonpayment.
Section 203. Additional Guarantee of Payment.
-------------------------------
Each of the Additional Guarantors further agrees that its
Additional Guarantee constitutes an Additional Guarantee of payment when due and
not of collection, and waives any right to require that any resort be had by the
Trustee or any Holder of the Securities to the security, if any, held for
payment of the Guaranteed Obligations.
Section 204. No Discharge or Diminishment of Additional Guarantee.
----------------------------------------------------
Subject to Section 210 of this Third Supplemental Indenture,
the obligations of each of the Additional Guarantors hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason
(other than the indefeasible payment in full in cash of the Guaranteed
Obligations), including any claim of waiver, release, surrender, alteration or
compromise of any of the Guaranteed Obligations, and shall not be subject to any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Guaranteed Obligations
or otherwise. Without limiting the generality of the foregoing, the obligations
of each of the Additional Guarantors hereunder shall not be discharged or
impaired or otherwise affected by the failure of the Trustee or any Holder of
the Securities to assert any claim or demand or to enforce any remedy under the
Indenture or the Securities, any other Additional Guarantee or any other
agreement, by any waiver or modification of any provision of any thereof, by any
default, failure or delay, willful or otherwise, in the performance of the
Guaranteed Obligations, or by any other act or omission that may or might in any
manner or to any extent vary the risk of any Additional Guarantor or that would
otherwise operate as a discharge of any Additional Guarantor as a matter of law
or equity (other than the indefeasible payment in full in cash of all the
Guaranteed Obligations).
-4-
<PAGE> 8
Section 205. Defenses of Company Waived.
--------------------------
To the extent permitted by applicable law, each of the
Additional Guarantors waives any defense based on or arising out of any defense
of the Company or any other Additional Guarantor or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Company, other than final and indefeasible
payment in full in cash of the Guaranteed Obligations. Each of the Additional
Guarantors waives any defense arising out of any such election even though such
election operates to impair or to extinguish any right of reimbursement or
subrogation or other right or remedy of each of the Additional Guarantors
against the Company or any security.
Section 206. Continued Effectiveness.
-----------------------
Subject to Section 210 of this Third Supplemental Indenture,
each of the Additional Guarantors further agrees that its Additional Guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest on any
Guaranteed Obligation is rescinded or must otherwise be restored by the Trustee
or any Holder of the Securities upon the bankruptcy or reorganization of the
Company.
Section 207. Subrogation.
-----------
In furtherance of the foregoing and not in limitation of any
other right of each of the Additional Guarantors by virtue hereof, upon the
failure of the Company to pay any Guaranteed Obligation when and as the same
shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each of the Additional Guarantors hereby promises to
and will, upon receipt of written demand by the Trustee or any Holder of the
Securities, forthwith pay, or cause to be paid, to the Holders in cash the
amount of such unpaid Guaranteed Obligations, and thereupon the Holders shall,
assign (except to the extent that such assignment would render an Additional
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Guaranteed
Obligations owed to it and paid by such Additional Guarantor pursuant to this
Additional Guarantee to such Additional Guarantor, such assignment to be PRO
RATA to the extent the Guaranteed Obligations in question were discharged by
such Additional Guarantor, or make such other disposition thereof as such
Additional Guarantor shall direct (all without recourse to the Holders, and
without any representation or warranty by the Holders). If (a) an Additional
Guarantor shall make payment to the Holders of all or any part of the Guaranteed
Obligations and (b) all the Guaranteed Obligations and all other amounts payable
under this Third Supplemental Indenture shall be indefeasibly paid in full, the
Trustee will, at such Guarantor's request, execute and deliver to such
Additional Guarantor appropriate
-5-
<PAGE> 9
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Additional Guarantor of an interest
in the Guaranteed Obligations resulting from such payment by such Additional
Guarantor.
Section 208. Information.
-----------
Each of the Additional Guarantors assumes all responsibility
for being and keeping itself informed of the Company's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each of the Additional Guarantors assumes and incurs hereunder, and agrees that
the Trustee and the Holders of the Securities will have no duty to advise the
Additional Guarantors of information known to it or any of them regarding such
circumstances or risks.
Section 209. Subordination.
-------------
Upon payment by any Additional Guarantor of any sums to the
Holders, as provided above, all rights of such Additional Guarantor against the
Company, arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinated and junior in right of payment
to the prior indefeasible payment in full in cash of all the Guaranteed
Obligations to the Trustee; PROVIDED, HOWEVER, that any right of subrogation
that such Additional Guarantor may have pursuant to this Third Supplemental
Indenture is subject to Section 207 hereof.
Section 210. Termination.
-----------
An Additional Guarantor shall, upon the occurrence of either
of the following events, be automatically and unconditionally released and
discharged from all obligations under this Third Supplemental Indenture and its
Additional Guarantee without any action required on the part of the Trustee or
any Holder if such release and discharge will not result in any downgrade in the
rating given to the Securities by Moody's Investors Service and Standard &
Poor's Ratings Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of an Additional Guarantor or
all, or substantially all, of the assets of such Additional Guarantor, which
sale or other disposition is otherwise in compliance with the terms of the
Indenture; provided, however, that such Additional Guarantor shall not be
released and discharged from its obligations under this Third Supplemental
Indenture and its Additional Guarantee if, upon consummation of such sale,
exchange, transfer or other disposition (by merger or otherwise), such
Additional Guarantor remains or becomes an Additional Guarantor under any Credit
Facility; or
-6-
<PAGE> 10
(b) at the request of the Company, at any time none of the
Credit Facilities are guaranteed by any Subsidiary of the Company,
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Additional Guarantor not
so released will remain liable for the full amount of the principal of, premium,
if any, and interest on the Securities provided in this Third Supplemental
Indenture and its Guarantee.
Section 211. Additional Guarantees of Other Indebtedness.
-------------------------------------------
As long as the Securities are guaranteed by the Additional
Guarantors, the Company will cause each of its Subsidiaries that becomes a
guarantor in respect of (i) any Indebtedness of the Company which is outstanding
on the date hereof and (ii) any Indebtedness incurred by the Company after the
date hereof (other than in respect of asset-backed securities), to include in
any guarantee given by any such guarantor, provisions similar to those set forth
in Section 210 hereof.
Section 212. Additional Guarantors.
---------------------
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become an Additional Guarantor under this Third Supplemental Indenture, if it
has not already done so or unless the Guarantor is prohibited from doing so by
applicable law or a provision of a contract to which it is a party or by which
it is bound.
Section 213. Limitation of Additional Guarantor's Liability.
----------------------------------------------
Each Additional Guarantor, other than The Kroger Co., and by
its acceptance hereof each Holder, hereby confirms that it is the intention of
all such parties that the Additional Guarantee by such Additional Guarantor not
constitute a fraudulent transfer or conveyance for purposes of Title 11 of the
United States Code, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar Federal of state law. To effectuate the
foregoing intention, the Holders and such Additional Guarantor hereby
irrevocably agree that the obligations of such Additional Guarantor under this
Third Supplemental Indenture and its Additional Guarantee shall be limited to
the maximum amount which, after giving effect to all other contingent and fixed
liabilities of such Additional Guarantor, and after giving effect to any
collections from or payments made by or on behalf of, any other Additional
Guarantor in respect of the obligations of such Additional Guarantor under its
Additional Guarantee or pursuant to its contribution obligations under this
Third Supplemental Indenture, will result in the
-7-
<PAGE> 11
obligations of such Additional Guarantor under its Additional Guarantee not
constituting such fraudulent transfer or conveyance.
Section 214. Contribution from Other Additional Guarantors.
---------------------------------------------
Each Additional Guarantor that makes a payment or distribution
under its Additional Guarantee shall be entitled to a contribution from each
other Additional Guarantor in a pro rata amount based on the net assets of each
Additional Guarantor, determined in accordance with generally accepted
accounting principles in effect in the United States of America as of the date
hereof.
Section 215. No Obligation to Take Action Against the Company.
------------------------------------------------
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Additional Guarantee.
Section 216. Dealing with the Company and Others.
-----------------------------------
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Additional Guarantor hereunder and without the consent of or notice to any
Additional Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
-8-
<PAGE> 12
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
ARTICLE THREE
-------------
MISCELLANEOUS
Section 301. Miscellaneous.
-------------
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Third Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Third Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Third Supplemental Indenture.
(c) Each of the Company, the Guarantors and the Trustee makes
and reaffirms as of the date of execution of this Third Supplemental Indenture
all of its respective representations, covenants and agreements set forth in the
Indenture.
(d) All covenants and agreements in this Third Supplemental
Indenture by the Company, the Guarantors, the Additional Guarantors and the
Trustee shall bind its respective successors and assigns, whether so expressed
or not.
(e) In case any provisions in this Third Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Third Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Third
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Third
Supplemental Indenture as so modified or excluded, as the case may be.
-9-
<PAGE> 13
(h) This Third Supplemental Indenture shall be governed by and
construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Third Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Third Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
-10-
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
RALPHS GROCERY COMPANY
<TABLE>
<S> <C>
Attest:
Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ----------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest*: Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ----------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: THE KROGER CO., as Additional Guarantor
of the Securities
Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ----------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest**: Each of the Additional Guarantors Listed on
Schedule II hereto, as Additional Guarantor of
the Securities
Bruce M. Gack By: (Paul W. Heldman)
- ---------------------------------- ----------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
</TABLE>
* Signing as duly authorized officer for each such Guarantor.
** Signing as duly authorized officer for each such Additional Guarantor.
-11-
<PAGE> 15
<TABLE>
<S> <C>
Attest: HENPIL, INC., as Additional Guarantor of the
Securities
WYDIV, INC. , as Additional Guarantor of
the Securities
By: (Steven McMillan)
- --------------------------------- -----------------------------------
Name: Steven McMillan
Title: Vice President
Attest: RICHIE'S INC., as Additional Guarantor of
the Securities
By: (Keith C. Larson)
- --------------------------------- -----------------------------------
Name: Keith C. Larson
Title: Vice President
Attest: VINE COURT ASSURANCE
INCORPORATED, as Additional Guarantor
of the Securities
(Beth Van Oflen) By: (Bruce M. Gack)
- --------------------------------- -----------------------------------
Beth Van Oflen, Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO., as
Additional Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- --------------------------------- -----------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: President
</TABLE>
-12-
<PAGE> 16
Attest: NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as Trustee
____________________________ By: ______________________________
Name:
Title:
-13-
<PAGE> 17
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Paul W. Heldman, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Ralphe Grocery Company and Vice President of each
of the Guarantors listed on Schedule I hereto and Vice President of each of the
Additional Guarantors listed on Schedule II hereto, and Senior Vice President of
The Kroger Co., and President of Kroger Dedicated Logistics Co., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
----------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 26, 2003
STATE OF TEXAS )
) ss.:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came
Steven McMillan, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Barbara Edwards)
----------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 19, 2001
<PAGE> 18
STATE OF TEXAS )
) ss.:
COUNTY OF EL PASO )
On the 30th day of July, 1999, before me personally came
Keith C. Larson, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Richie's, Inc., one of the corporations described
in and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
(Mercedes Flores)
----------------------------
Notary Public
Mercedes Flores [Notary Seal]
Notary Public, State of Texas
My Commission Expires 10/23/99
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Bruce M. Gack, to me known, who, being by me duly sworn, did depose and say that
he is Vice President of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
----------------------------------
Notary Public
Brenda R. Andes [Notary Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
<PAGE> 19
STATE OF __________ )
) ss.:
COUNTY OF ________ )
On the ____ day of July, 1999, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he/she is a _____________ of Norwest Bank Minnesota, National Association,
one of the corporations described in and which executed the foregoing
instrument; that he/she knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that he/she signed
his/her name thereto by like authority.
____________________________
<PAGE> 20
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
- ----------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less GM, Inc. California
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
<PAGE> 21
SCHEDULE II
Additional Guarantors
---------------------
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
<PAGE> 22
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
<PAGE> 1
Exhibit 4.12
================================================================================
RALPHS GROCERY COMPANY
and certain Guarantors
TO
UNITED STATES TRUST COMPANY OF NEW YORK
Trustee
----------
FOURTH SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of March 30, 1993
----------
$150,000,000 9% Senior Subordinated Notes due 2003 and
9% Series B Senior Subordinated Notes due 2003
================================================================================
<PAGE> 2
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
ARTICLE ONE
-----------
DEFINITIONS
-----------
<S> <C>
Section 101. DEFINITIONS.................................................................................2
ARTICLE TWO
-----------
GUARANTEE
---------
Section 201. GUARANTEE...................................................................................3
Section 202. WAIVER OF DEMAND............................................................................4
Section 203. GUARANTEE OF PAYMENT........................................................................4
Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE...................................................5
Section 205. DEFENSES OF COMPANY WAIVED..................................................................5
Section 206. CONTINUED EFFECTIVENESS.....................................................................5
Section 207. SUBROGATION.................................................................................5
Section 208. INFORMATION.................................................................................6
Section 209. SUBORDINATION...............................................................................6
Section 210. TERMINATION.................................................................................7
Section 211. GUARANTEES OF OTHER INDEBTEDNESS............................................................7
Section 212. GUARANTORS..................................................................................7
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.........................................................8
Section 214. CONTRIBUTION FROM OTHER GUARANTORS..........................................................8
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY............................................8
Section 216. DEALING WITH THE COMPANY AND OTHERS.........................................................8
Section 217. SUBORDINATION OF GUARANTEE..................................................................9
</TABLE>
-i-
<PAGE> 3
<TABLE>
<CAPTION>
PAGE
----
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
--------------------------------------
<S> <C>
Section 301. GUARANTEE OBLIGATIONS SUBORDINATE TO SENIOR INDEBTEDNESS OF GUARANTORS......................9
Section 302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.............................................10
Section 303. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.............................................11
Section 304. PAYMENT PERMITTED IF NO DEFAULT............................................................12
Section 305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS....................................12
Section 306. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS................................................13
Section 307. TRUSTEE TO EFFECTUATE SUBORDINATION........................................................13
Section 308. NO WAIVER OF SUBORDINATION PROVISIONS......................................................14
Section 309. NOTICE TO TRUSTEE..........................................................................14
Section 310. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGENT.............................15
Section 311. RIGHTS OF TRUSTEE AS A HOLDER OF SENIOR INDEBTEDNESS; PRESERVATION OF TRUSTEE'S RIGHTS.....15
Section 312. ARTICLE APPLICABLE TO PAYING AGENTS........................................................16
ARTICLE FOUR
------------
MISCELLANEOUS
-------------
Section 401. MISCELLANEOUS..............................................................................16
</TABLE>
-ii-
<PAGE> 4
FOURTH SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this
"Fourth Supplemental Indenture"), among Ralphs Grocery Company, a corporation
duly organized and existing under the laws of the State of Delaware (herein
called the "Company"), having its principal office at 1100 West Artesia
Boulevard, Compton, California 90220, each of the guarantors signatory hereto as
set forth on the signature pages and on Schedule I (collectively, the
"Guarantors"), and United States Trust Company of New York, a New York
corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of March 30, 1993 (as amended and supplemented,
the "Indenture") providing for the issuance of $150,000,000 aggregate principal
amount of the Company's 9% Senior Subordinated Notes due 2003 (the "Initial
Securities").
Pursuant to the First Supplemental Indenture dated as of June
23, 1993 (the "First Supplemental Indenture"), between the Company and the
Trustee, the Company consummated an exchange offer for the Initial Securities
whereby the Company offered to exchange $1,000 principal amount of its 9% Series
B Senior Subordinated Notes due 2003 (the "Exchange Securities," and together
with the Initial Securities, the "Securities"), for each $1,000 principal amount
of its Initial Securities.
The Indenture has been supplemented by the First Supplemental
Indenture, Second Supplemental Indenture dated as of May 30, 1995 (the "Second
Supplemental Indenture") and the Third Supplemental Indenture dated as of June
14, 1995 (the "Third Supplemental Indenture").
Each of the Guarantors has duly authorized the issuance of a
Guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly authorized the execution and delivery of this Fourth
Supplemental Indenture.
Section 901(c) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture, in form satisfactory to the Trustee,
to make any other provisions with respect to matters or questions arising under
the Indenture, provided that such action shall not adversely affect the
interests of the Holders of Securities in any material respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Fourth Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities.
All things necessary to make this Fourth Supplemental
Indenture a valid
-1-
<PAGE> 5
agreement of the Company and each of the Guarantors, and a valid amendment of,
and supplement to the Indenture, have been done.
NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
-----------
Section 101. DEFINITIONS.
For all purposes of this Fourth Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Fourth
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Fourth Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Fourth Supplemental Indenture.
(4) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by The Kroger Co. or Fred
Meyer, Inc. and outstanding on the date of this Fourth Supplemental Indenture
and any refinancing or other restructuring of any such agreement or facility.
(5) "Guarantee" has the meaning specified in Section 201.
(6) "Guaranteed Obligations" has the meaning specified in Section 201.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Obligations" means all obligations for the reimbursement of
amounts drawn under any letter of credit or for the payment of principal,
premium, interest (including, without limitation, interest whether or not
allowed after the filing of a petition initiating
-2-
<PAGE> 6
any proceeding referred to in Section 501 (6) or (7) of the Indenture at the
rate specified in the instrument governing the relevant Indebtedness),
penalties, fees, expenses, indemnities or other amounts, now or hereafter
existing, with respect to any Indebtedness.
(9) "Senior Indebtedness" means, with respect to any Guarantor,
the principal of (and premium, if any) and interest on, and all other amounts
payable in respect of, (a) all Indebtedness of such Guarantor, whether
outstanding on the date of the Indenture or thereafter Incurred, (b) any
obligations of such Guarantor under interest rate swaps, caps, collars and
similar arrangements, (c) any obligations of such Guarantor under foreign
currency hedges entered into in respect of any such Indebtedness or obligation
and (d) any amendments, renewals, extensions, modifications, and refundings of
any such Indebtedness or obligation, except (i) any Indebtedness or obligation
owed to a Subsidiary, (ii) any Indebtedness or obligation which by the terms of
the instrument creating or evidencing the same is not superior in right of
payment to such Guarantor's Guarantee, (iii) any Indebtedness or obligation
which is subordinated or junior in any respect to any other Indebtedness or
obligation of such Guarantor, and (iv) any indebtedness or obligation
constituting a trade account payable of such Guarantor. Any obligation under any
Senior Indebtedness shall continue to constitute Senior Indebtedness despite a
determination that the Incurrence of such obligation by a Guarantor was a
preference under Section 547(b) of Title 11 of the United States Code (or any
successor thereto) or was a fraudulent conveyance or transfer under Federal or
State Law.
ARTICLE TWO
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GUARANTEE
Section 201. GUARANTEE.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of the Indenture or
the Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Guaranteed Obligations") will be promptly paid in full or performed, all in
accordance with the terms of the Indenture and the Securities; and (b) in case
of any extension of time of payment or renewal of any Guaranteed Obligations,
the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
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acceleration or otherwise. If the Company shall fail to pay when due, or to
perform, any Guaranteed Obligations, for whatever reason, each Guarantor shall
be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Guarantee, and shall entitle the
Holders of Securities to accelerate the Guaranteed Obligations of the Guarantor
hereunder in the same manner and to the same extent as the Guaranteed
Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Guaranteed Obligations may be accelerated as provided in Article
Five of the Indenture for the purposes of its Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the Guaranteed Obligations, and (b) in the event of any acceleration of such
Guaranteed Obligations as provided in Article Five of the Indenture, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become
due and payable by such Guarantor for the purposes of its Guarantee.
Section 202. WAIVER OF DEMAND.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Guaranteed Obligations, and also waives notice of acceptance of its
Guarantee and notice of protest for nonpayment.
Section 203. GUARANTEE OF PAYMENT.
Each of the Guarantors further agrees that its Guarantee
constitutes a Guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Guaranteed
Obligations.
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Section 204. NO DISCHARGE OR DIMINISHMENT OF GUARANTEE.
Subject to Section 210 of this Fourth Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than the
indefeasible payment in full in cash of the Guaranteed Obligations), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each of the
Guarantors hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Trustee or any Holder of the Securities to assert any
claim or demand or to enforce any remedy under the Indenture or the Securities,
any other Guarantee or any other agreement, by any waiver or modification of any
provision of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the Guaranteed Obligations, or by any other act
or omission that may or might in any manner or to any extent vary the risk of
any Guarantor or that would otherwise operate as a discharge of any Guarantor as
a matter of law or equity (other than the indefeasible payment in full in cash
of all the Guaranteed Obligations).
Section 205. DEFENSES OF COMPANY WAIVED.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Company, other than final and indefeasible payment in
full in cash of the Guaranteed Obligations. Each of the Guarantors waives any
defense arising out of any such election even though such election operates to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of each of the Guarantors against the Company or any security.
Section 206. CONTINUED EFFECTIVENESS.
Subject to Section 210 of this Fourth Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Guaranteed
Obligation is rescinded or must otherwise be restored by the Trustee or any
Holder of the Securities upon the bankruptcy or reorganization of the Company.
Section 207. SUBROGATION.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any
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Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Guaranteed Obligations, and
thereupon the Holders shall, assign (except to the extent that such assignment
would render a Guarantor a "creditor" of the Company within the meaning of
Section 547 of Title 11 of the United States Code as now in effect or hereafter
amended or any comparable provision of any successor statute) the amount of the
Guaranteed Obligations owed to it and paid by such Guarantor pursuant to this
Guarantee to such Guarantor, such assignment to be PRO RATA to the extent the
Guaranteed Obligations in question were discharged by such Guarantor, or make
such other disposition thereof as such Guarantor shall direct (all without
recourse to the Holders, and without any representation or warranty by the
Holders). If (a) a Guarantor shall make payment to the Holders of all or any
part of the Guaranteed Obligations and (b) all the Guaranteed Obligations and
all other amounts payable under this Fourth Supplemental Indenture shall be
indefeasibly paid in full, the Trustee will, at such Guarantor's request,
execute and deliver to such Guarantor appropriate documents, without recourse
and without representation or warranty, necessary to evidence the transfer by
subrogation to such Guarantor of an interest in the Guaranteed Obligations
resulting from such payment by such Guarantor.
Section 208. INFORMATION.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 209. SUBORDINATION.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to the prior
indefeasible payment in full in cash of all the Guaranteed Obligations to the
Trustee; PROVIDED, HOWEVER, that any right of subrogation that such Guarantor
may have pursuant to this Fourth Supplemental Indenture is subject to Section
207 hereof.
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Section 210. TERMINATION.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Fourth Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Services and Standard & Poor's Rating
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged from
its obligations under this Fourth Supplemental Indenture and its Guarantee if,
upon consummation of such sale, exchange, transfer or other disposition (by
merger or otherwise), such Guarantor remains or becomes a guarantor under any
Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Fourth Supplemental Indenture and its
Guarantee.
Section 211. GUARANTEES OF OTHER INDEBTEDNESS.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such guarantor provisions similar to those set forth in Section 210
hereof.
Section 212. ADDITIONAL GUARANTORS.
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become a Guarantor under this Fourth Supplemental Indenture, if it has not
already done so or unless the Guarantor is
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prohibited from doing so by applicable law or a provision of a contract to which
it is a party or by which it is bound.
Section 213. LIMITATION OF GUARANTOR'S LIABILITY.
Each Guarantor, other than The Kroger Co., and by its
acceptance hereof each Holder, hereby confirms that it is the intention of all
such parties that the Guarantee by such Guarantor not constitute a fraudulent
transfer or conveyance for purposes of Title 11 of the United States Code, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar Federal of state law. To effectuate the foregoing intention, the Holders
and such Guarantor hereby irrevocably agree that the obligations of such
Guarantor under this Fourth Supplemental Indenture and its Guarantee shall be
limited to the maximum amount which, after giving effect to all other contingent
and fixed liabilities of such Guarantor, and after giving effect to any
collections from or payments made by or on behalf of, any other Guarantor in
respect of the obligations of such Guarantor under its Guarantee or pursuant to
its contribution obligations under this Fourth Supplemental Indenture, will
result in the obligations of such Guarantor under its Guarantee not constituting
such fraudulent transfer or conveyance.
Section 214. CONTRIBUTION FROM OTHER GUARANTORS.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 215. NO OBLIGATION TO TAKE ACTION AGAINST THE COMPANY.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantee.
Section 216. DEALING WITH THE COMPANY AND OTHERS.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
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(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 217. SUBORDINATION OF GUARANTEE.
The obligations of each Guarantor to the Holders of the
Securities and to the Trustee pursuant to the Guarantee and this Indenture are
expressly subordinate and subject in right of payment to the prior payment in
full in cash of all Senior Indebtedness of such Guarantor, to the extent and in
the manner provided in Article Three.
ARTICLE THREE
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SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. GUARANTEE OBLIGATIONS SUBORDINATE TO SENIOR INDEBTEDNESS OF
GUARANTORS.
Each Guarantor covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees, that, to the
extent and in the manner hereinafter set forth in this Article, the indebtedness
represented by the Guarantee of such Guarantor, including the obligation of such
Guarantor in respect of the payment of the principal of and premium, if any, and
interest (including any payments required due to the occurrence of a Change of
Control Triggering Event) on each and all of the Securities, is hereby expressly
made subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness of such Guarantor (including any interest accruing after
the occurrence of an Event of Default under Section 501(f) or (g) of the
Indenture).
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Section 302. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any Guarantor or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of such Guarantor, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the benefit
of creditors or any other marshalling of assets and liabilities of such
Guarantor, then and in any such event:
(1) the holders of Senior Indebtedness of such Guarantor
shall be entitled to receive payment in full of all amounts due or
to become due on or in respect of all Senior Indebtedness of such
Guarantor, or provision shall be made for such payment in cash or
cash equivalents, before the Holders of the Securities are
entitled to receive any payment in respect of such Guarantor's
Guarantee, including on account of principal of (or premium, if
any) or interest on the Securities; and
(2) any payment or distribution of assets of such
Guarantor of any kind or character, whether in cash, property or
securities, by set-off or otherwise, to which the Holders or the
Trustee would be entitled but for the provisions of this Article,
including any such payment or distribution which may be payable or
deliverable by reason of the payment of any other indebtedness of
such Guarantor being subordinated to the payment of the Guarantee
of such Guarantor (except, so long as the effect of this
parenthetical clause is not to cause the Guarantee of such
Guarantor to be treated in any case or proceeding or similar event
described in Subsection (a), (b) or (c) of this Section 302 as
part of the same class of claims as the Senior Indebtedness of
such Guarantor or any class of claims on a parity with or senior
to the Senior Indebtedness of such Guarantor, for any such payment
or distribution (x) authorized by an order or decree giving
effect, and stating in such order or decree that effect is given,
to the subordination of the Guarantees to the Senior Indebtedness
of such Guarantor, and made by a court of competent jurisdiction
in a reorganization proceeding under any applicable bankruptcy
law, or (y) of securities that (i) are unsecured, (ii) have an
Average Life to Stated Maturity and final maturity that are no
shorter than the Average Life to Stated Maturity of the Securities
and (iii) are subordinated, to at least the same extent as the
Guarantees, to the payment of all Senior
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Indebtedness of such Guarantor then outstanding), shall be paid by
the liquidating trustee or agent or other person making such
payment or distribution, whether a trustee in bankruptcy, a
receiver or liquidating trustee or otherwise, directly to the
holders of Senior Indebtedness of such Guarantor or their
representative or representatives or to the trustee or trustees
under any indenture under which any instruments evidencing any of
such Senior Indebtedness of such Guarantor may have been issued,
ratably according to the aggregate amounts remaining unpaid on
account of the principal of, and premium, if any, and interest on,
and other amounts due on or in connection with, the Senior
Indebtedness of such Guarantor to the extent necessary to make
payment in full of all Senior Indebtedness of such Guarantor
remaining unpaid, after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness of such
Guarantor; and
(3) in the event that, notwithstanding the foregoing
provisions of this Section, the Trustee or the Holder of any
Security shall have received any such payment or distribution of
assets of any Guarantor of any kind or character, whether in cash,
property or securities, including any such payment or distribution
which may be payable or deliverable by reason of the payment of
any other indebtedness of such Guarantor being subordinated to the
payment of the Guarantee of such Guarantor, before all Senior
Indebtedness of such Guarantor is paid in full or payment thereof
provided for, then and in such event such payment or distribution
shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of
such Guarantor for application to the payment of all Senior
Indebtedness of such Guarantor remaining unpaid to the extent
necessary to pay all Senior Indebtedness of such Guarantor in
full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness of such
Guarantor.
Section 303. NO PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.
(i) In the event of and during the continuation of any default
in the payment of principal of (or premium, if any) or interest on any Senior
Indebtedness of any Guarantor beyond any applicable grace period with respect
thereto, or (ii) in the event that any other event of default with respect to
any Senior Indebtedness of any
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Guarantor shall have occurred and be continuing that permits the holders of such
Senior Indebtedness (or a trustee on behalf of such holders) to declare such
Senior Indebtedness due and payable prior to the date on which it would
otherwise have become due and payable either without further notice or upon the
expiration of any grace period applicable to such event of default, and written
notice thereof shall have been given to each of such Guarantor and the Trustee
by the trustee or representative for, or the holders of at least a majority of
the principal amount of the Senior Indebtedness of such Guarantor (the "Payment
Notice"), then no payment shall be made by such Guarantor in respect of its
Guarantee including on account of the principal of (or premium, if any) or
interest on the Securities or on account of the purchase or redemption or other
acquisition of Securities until (x) in case of an event of default described in
clause (i), unless and until such payment event of default shall have been cured
or waived or shall have ceased to exist or the holders of such Senior
Indebtedness or their agents have waived the benefits of this Section, or (y) in
case of any event of default specified in clause (ii), until the earlier of (1)
179 days after the date on which a Payment Notice shall have been given and (2)
the date, if any, on which such event of default is waived by the holders of
such Senior Indebtedness or otherwise cured or has ceased to exist or the Senior
Indebtedness to which such event of default relates is discharged (provided that
further written notice relating to the same or any other event of default
specified in clause (ii) above with respect to any Senior Indebtedness received
by such Guarantor or the Trustee within 12 months after such prior receipt of a
Payment Notice shall not be effective to further prohibit such payments).
In the event that, notwithstanding the foregoing, any
Guarantor shall make any payment to the Trustee or the Holder of any Security
prohibited by the foregoing provisions of this Section, then and in such event
such payment shall be paid over and delivered forthwith to such Guarantor.
The provisions of this Section shall not apply to any payment
with respect to which Section 302 would be applicable.
Section 304. PAYMENT PERMITTED IF NO DEFAULT.
Nothing in this Article or elsewhere in the Indenture or in
any Guarantee or in any of the Securities shall prevent any Guarantor, at any
time except during the pendency of any case, proceeding, dissolution,
liquidation or other winding up, assignment for the benefit of creditors or
other marshalling of assets and liabilities of such Guarantor referred to in
Section 302 or under the conditions described in Section 303, from making
payments at any time under its Guarantee, including of principal of (and
premium, if any) or interest on the Securities.
Section 305. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the payment in full of all Senior Indebtedness of
each Guarantor,
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the Holders of the Securities shall be subrogated (equally and ratably with the
holders of all indebtedness of such Guarantor which by its express terms is
subordinated to Senior Indebtedness of such Guarantor to the same extent as the
Securities are subordinated and which is entitled to like rights of subrogation)
to the rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness of such Guarantor until the principal of (and premium, if any) and
interest on the Securities shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of Senior Indebtedness
of any cash, property or securities to which the holders of the Senior
Indebtedness of any Guarantor or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Indebtedness by Holders of the Securities
or the Trustee, shall, as among such Guarantor, its creditors other than holders
of Senior Indebtedness, and the Holders of the Securities, be deemed to be a
payment or distribution by such Guarantor to or on account of the Senior
Indebtedness of such Guarantor.
Section 306. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the Holders of the Securities on
the one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in the Indenture or in the Securities is
intended to or shall (a) impair, as among any Guarantor, its creditors other
than holders of Senior Indebtedness and the Holders of the Securities, the
obligation of such Guarantor which is absolute and unconditional, to pay to the
Holders of the Securities the principal of (and premium, if any) and interest on
the Securities as and when the same shall become due and payable in accordance
with their terms; or (b) affect the relative rights against any Guarantor of the
Holders of the Securities and creditors of such Guarantor other than the holders
of Senior Indebtedness of such Guarantor; or (c) prevent the Trustee or the
Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the express
limitations set forth in Article Five of the Indenture and to the rights, if
any, under this Article of the holders of Senior Indebtedness of such Guarantor
(1) in any case, proceeding, dissolution, liquidation or other winding up,
assignment for the benefit of creditors or other marshalling of assets and
liabilities of such Guarantor referred to in Section 302, to receive, pursuant
to and in accordance with such Section, cash, property and securities otherwise
payable or deliverable to the Trustee or such Holder, or (2) under the
conditions specified in Section 303, to prevent any payment prohibited by such
Section.
Section 307. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may be necessary or
appropriate to
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effectuate the subordination provided in this Article and appoints the Trustee
his attorney-in-fact for any and all such purposes.
Section 308. NO WAIVER OF SUBORDINATION PROVISIONS.
No rights of any present or future holder of any Senior
Indebtedness of any Guarantor to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of such Guarantor or by any act or failure to act, in good faith, by
any such holder, or by any non-compliance by such Guarantor with the terms,
provisions and covenants of this Indenture, regardless of any knowledge thereof
any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holder of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (a) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness or any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (c) release any Person liable in any manner for the collection of
Senior Indebtedness; and (d) exercise or refrain from exercising any rights
against the Company and any other Person.
Section 309. NOTICE TO TRUSTEE.
Each Guarantor shall give prompt written notice to the Trustee
of any fact known to such Guarantor which would prohibit the making of any
payment to or by the Trustee in respect of the Securities. Notwithstanding the
provisions of this Article or any other provision of the Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until the Trustee shall have received written notice
thereof from any Guarantor or a holder of Senior Indebtedness or from any
trustee, fiduciary or agent therefor; and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Section 601 of the
Indenture, shall be entitled in all respects to assume that no such facts exist;
PROVIDED, HOWEVER, that if the Trustee shall not have received the notice
provided for in this Section at least three Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium, if
any) or interest on any Security), then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such money
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and to apply the same to the purpose for which such money was received and shall
not be affected by any notice to the contrary which may be received by it which
three Business Days prior to such date.
Subject to the provisions of Section 601 of the Indenture, the
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be holder of Senior Indebtedness (or a trustee,
fiduciary to agent therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee, fiduciary or agent therefor). In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request that such Person furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article, and if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 310. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
Upon any amount or distribution of assets of any Guarantor
referred to in this Article, the Trustee, subject to the provisions of Section
601 of the Indenture, and the Holders of the Securities shall be entitled to
rely upon any other or decree entered by any court of competent jurisdiction in
which such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution delivered to the Trustee and to the Holders of
Securities, for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of Senior Indebtedness and other
indebtedness of such Guarantor, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
Section 311. RIGHTS OF TRUSTEE AS A HOLDER OF SENIOR INDEBTEDNESS;
PRESERVATION OF TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in the Indenture shall deprive the Trustee of
any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 606 of the Indenture.
-15-
<PAGE> 19
Section 312. ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting thereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; PROVIDED,
HOWEVER, that Section 311 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent.
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. MISCELLANEOUS.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Fourth Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Fourth Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Fourth Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Fourth Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
(d) All covenants and agreements in this Fourth Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Fourth Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Fourth Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision
-16-
<PAGE> 20
of the Trust Indenture Act of 1939, as may be amended from time to time, that is
required under such Act to be a part of and govern this Fourth Supplemental
Indenture, the latter provision shall control. If any provision hereof modifies
or excludes any provision of such Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Fourth Supplemental Indenture
as so modified or excluded, as the case may be.
(h) This Fourth Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Fourth Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Fourth Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
-17-
<PAGE> 21
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
<TABLE>
<S> <C>
Attest: RALPHS GROCERY COMPANY
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: THE KROGER CO., as Guarantor of the
Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Senior Vice President
Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
Attest:
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: HENPIL, INC., as Guarantor of the Securities
WYDIV, INC. , as Guarantor of the Securities
- ---------------------------------- By: (Steven McMillan)
--------------------------------
Name: Steven McMillan
Title: Vice President
* Signing as duly authorized officer for each such Guarantor.
-18-
<PAGE> 22
Attest: RICHIE'S, INC. , as Guarantor of the
Securities
By: (Keith C. Larson)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Keith C. Larson
Attest: VINE COURT ASSURANCE
INCORPORATED, as Guarantor of the
Securities
(Beth Van Oflen) By: (Bruce M. Gack)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO., as
Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: Vice President
</TABLE>
-19-
<PAGE> 23
Attest: UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
__________________ By: ________________________________
Name:
Title:
-20-
<PAGE> 24
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Paul W. Haldman, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Ralphs Grocery Company and each of the Guarantors
Listed on Schedule I hereto, and Senior Vice President of The Kroger Co., and
President of Kroger Dedicated Logistics Co., corporations described in and
which executed the foregoing instrument; that he knows the seals of said
corporations; that the seals affixed to said instrument are such corporate
seals; that they were so affixed by authority of the Boards of Directors of
said corporations, and that he signed his name thereto by like authority.
(Brenda R. Andes)
------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
STATE OF TEXAS )
) ss.:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came
Steven McMillan, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Henpil, Inc. and Wydiv, Inc., the corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Barbara Edwards)
------------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 19, 2001
<PAGE> 25
STATE OF TEXAS )
) ss.:
COUNTY OF EL PASO )
On the 30th day of July, 1999, before me personally came
Keith C. Larson, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Richie's, Inc., one of the corporations described
in and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
(Mercedes Flores)
------------------------------
Notary Public
Mercedes Flores [Notarial Seal]
Notary Public, State of Texas
My Commission Expires 10/23/00
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Bruce M. Gack, to me known, who, being by me duly sworn, did depose and say that
he is Vice President of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
<PAGE> 26
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
<PAGE> 27
Name of Guarantor State of Incorporation/organization
- ----------------- -----------------------------------
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
<PAGE> 1
EXHIBIT 4.13
----------------------------------------------------------------
RALPHS GROCERY COMPANY
and certain Guarantors
TO
UNITED STATES TRUST COMPANY OF NEW YORK
Trustee
----------
THIRD SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of June 1, 1995
----------
$524,055,000 11% Senior Subordinated Notes due 2005
----------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
-----------------
ARTICLE ONE
-----------
DEFINITIONS
<TABLE>
<CAPTION>
<S> <C> <C>
Section 101. Definitions......................................................2
-----------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE TWO
-----------
GUARANTEE
<S> <C> <C>
Section 201. Additional Guarantee.............................................3
--------------------
Section 202. Waiver of Demand.................................................4
----------------
Section 203. Additional Guarantee of Payment..................................4
-------------------------------
Section 204. No Discharge or Diminishment of Additional Guarantee.............4
----------------------------------------------------
Section 205. Defenses of Company Waived.......................................5
--------------------------
Section 206. Continued Effectiveness..........................................5
-----------------------
Section 207. Subrogation......................................................5
-----------
Section 208. Information......................................................6
-----------
Section 209. Subordination....................................................6
-------------
Section 210. Termination......................................................6
-----------
Section 211. Additional Guarantees of Other Indebtedness......................7
-------------------------------------------
Section 212. Additional Guarantors............................................7
---------------------
Section 213. Limitation of Additional Guarantor's Liability...................7
----------------------------------------------
Section 214. Contribution from Other Guarantors...............................8
----------------------------------
Section 215. No Obligation to Take Action Against the Company.................8
------------------------------------------------
Section 216. Dealing with the Company and Others..............................8
-----------------------------------
Section 217. Subordination of Guarantee.......................................9
--------------------------
</TABLE>
-i-
<PAGE> 3
Page
----
ARTICLE THREE
-------------
<TABLE>
<CAPTION>
SUBORDINATION OF ADDITIONAL GUARANTEE OBLIGATIONS
<S> <C> <C>
Section 301. Additional Guarantee Obligations Subordinated to Senior
-------------------------------------------------------
Indebtedness of Additional Guarantors.............................9
-------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE FOUR
------------
MISCELLANEOUS
<S> <C> <C>
Section 401. Miscellaneous.....................................................9
</TABLE>
-ii-
<PAGE> 4
THIRD SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this
"Third Supplemental Indenture"), among Ralphs Grocery Company, a Delaware
corporation having its principal office at 1100 West Artesia Boulevard, Compton,
California 90220 (herein called the "Company"), each of the subsidiary
guarantors signatory hereto as set forth on Schedule I (collectively, the
"Subsidiary Guarantors"), each of the additional guarantors signatory hereto as
set forth on the signature pages and Schedule II (collectively, the "Additional
Guarantors" and collectively with the Subsidiary Guarantors, the "Guarantors"),
and United States Trust Company of New York, a New York corporation, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of June 1, 1995 (as amended and supplemented, the
"Indenture") providing for the issuance of the $524,055,000 11% Senior
Subordinated Notes Due 2005 (the "Securities").
The Indenture has been supplemented by the First Supplemental
Indenture, dated as of June 14, 1995 (the "First Supplemental Indenture") and
the Second Supplemental Indenture dated as of February 26, 1998 (the "Second
Supplemental Indenture").
Each of the Additional Guarantors has duly authorized the
issuance of a guarantee of the Securities, as set forth herein, and to provide
therefor, each of the Additional Guarantors has duly authorized the execution
and delivery of this Third Supplemental Indenture.
Section 10.01(4) of the Indenture provides that, without the
notice to and consent of any Holders, the Company and the Subsidiary Guarantors,
when authorized by a Board Resolution, and the Trustee together, may amend or
supplement the Indenture to make any other change that does not adversely affect
the rights of any Securityholder in any material respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Third Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities.
All things necessary to make this Third Supplemental Indenture
a valid agreement of the Company, each of the Subsidiary Guarantors and each of
the Additional Guarantors, and a valid amendment of, and supplement to the
Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
Section 101. Definitions.
- ------------ ------------
For all purposes of this Third Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have the
meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Third
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Third Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Third Supplemental Indenture.
(4) "Additional Guarantee" has the meaning specified in Section 201.
(5) "Additional Guaranteed Obligations" has the meaning specified in
Section 201.
(6) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by The Kroger Co. or Fred
Meyer, Inc. and outstanding on the date of this Third Supplemental Indenture,
and any refinancing or other restructuring of any such agreement or facility.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Senior Indebtedness" means, with respect to any Additional
Guarantor, the principal of (and premium if any) and interest on, and all other
amounts payable in respect of, (a) any all Indebtedness of such Additional
Guarantor, whether outstanding on the date of the Indenture or thereafter
Incurred, (b) any obligations of such Additional Guarantor under interest rate
swaps, caps. collars and similar arrangements,
-2-
<PAGE> 6
(c) obligations of such Additional Guarantor under foreign currency hedges
entered into in respect of any such Indebtedness or obligation and (d) any
amendments, renewals, extensions, modifications, and refundings of any such
Indebtedness or obligation, except (i) any Indebtedness or obligation owed to a
Subsidiary, (ii) any Indebtedness or obligation which by the terms of the
instrument creating or evidencing the same is not superior in right of payment
to such Additional Guarantor's Additional Guarantee, (iii) any Indebtedness or
obligation which is subordinated or junior in any respect to any other
Indebtedness or obligation of such Additional Guarantor, and (iv) any
indebtedness or obligation constituting a trade account payable of such
Additional Guarantor. Any obligation under any Senior Indebtedness shall
continue to constitute Senior Indebtedness despite a determination that the
Incurrence of such obligation by an Additional Guarantor was a preference under
Section 547(b) of Title 11 of the United States Code (or any successor thereto)
or was a fraudulent conveyance or transfer under Federal or State Law.
ARTICLE TWO
-----------
GUARANTEE
Section 201. Additional Guarantee.
--------------------
Each Additional Guarantor hereby jointly and severally fully
and unconditionally guarantees (each an "Additional Guarantee") to each Holder
of a Security authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
the Indenture or the Securities or the obligations of the Company or any other
Additional Guarantor to the Holders or the Trustee hereunder or thereunder, that
(a) the principal of, premium, if any, and interest on the Securities will be
duly and punctually paid in full when due, whether at maturity, upon redemption,
by acceleration or otherwise, and interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Securities and all other
obligations of the Company or the Additional Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Guaranteed Obligations") will be
promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Guaranteed Obligations, the same will be promptly paid
in full when due or performed in accordance with the terms of the extension or
renewal, whether at Stated Maturity, by acceleration or otherwise. If the
Company shall fail to pay when due, or to perform, any Guaranteed Obligations,
for whatever reason, each Additional Guarantor shall be obligated to pay, or to
perform or cause the performance of, the same immediately. An Event of Default
under the Indenture or the Securities shall constitute an event of default under
this Additional Guarantee, and shall entitle the Holders of Securities to
accelerate the Guaranteed Obligations of the Additional Guarantor hereunder in
the same manner and to the same extent as the Guaranteed Obligations of the
Company.
-3-
<PAGE> 7
Each Additional Guarantor hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not an Additional Guarantee is affixed to any
particular Security, or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of Guarantor.
Each Additional Guarantor further agrees that, as between it,
on the one hand, and the Holders of Securities and the Trustee, on the other
hand, (a) the maturity of the Guaranteed Obligations may be accelerated as
provided in Article Seven of the Indenture for the purposes of its Additional
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Guaranteed Obligations, and (b) in the event
of any acceleration of such Guaranteed Obligations as provided in Article Seven
of the Indenture, such Guaranteed Obligations (whether or not due and payable)
shall forthwith become due and payable by such Additional Guarantor for the
purposes of its Additional Guarantee.
Section 202. Waiver of Demand.
----------------
To the fullest extent permitted by applicable law, each of the
Additional Guarantors waives presentment to, demand of payment from and protest
of any of the Guaranteed Obligations, and also waives notice of acceptance of
its Additional Guarantee and notice of protest for nonpayment.
Section 203. Additional Guarantee of Payment.
-------------------------------
Each of the Additional Guarantors further agrees that its
Additional Guarantee constitutes an Additional Guarantee of payment when due and
not of collection, and waives any right to require that any resort be had by the
Trustee or any Holder of the Securities to the security, if any, held for
payment of the Guaranteed Obligations.
Section 204. No Discharge or Diminishment of Additional Guarantee.
----------------------------------------------------
Subject to Section 210 of this Third Supplemental Indenture,
the obligations of each of the Additional Guarantors hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason
(other than the indefeasible payment in full in cash of the Guaranteed
Obligations), including any claim of waiver, release, surrender, alteration or
compromise of any of the Guaranteed Obligations, and shall not be subject to any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Guaranteed Obligations
or otherwise. Without limiting the generality of the foregoing, the obligations
of each of the
-4-
<PAGE> 8
Additional Guarantors hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Trustee or any Holder of the Securities to assert
any claim or demand or to enforce any remedy under the Indenture or the
Securities, any other Additional Guarantee or any other agreement, by any waiver
or modification of any provision of any thereof, by any default, failure or
delay, willful or otherwise, in the performance of the Guaranteed Obligations,
or by any other act or omission that may or might in any manner or to any extent
vary the risk of any Additional Guarantor or that would otherwise operate as a
discharge of any Additional Guarantor as a matter of law or equity (other than
the indefeasible payment in full in cash of all the Guaranteed Obligations).
Section 205. Defenses of Company Waived.
--------------------------
To the extent permitted by applicable law, each of the
Additional Guarantors waives any defense based on or arising out of any defense
of the Company or any other Guarantor or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Company, other than final and indefeasible payment in
full in cash of the Guaranteed Obligations. Each of the Additional Guarantors
waives any defense arising out of any such election even though such election
operates to impair or to extinguish any right of reimbursement or subrogation or
other right or remedy of each of the Additional Guarantors against the Company
or any security.
Section 206. Continued Effectiveness.
-----------------------
Subject to Section 210 of this Third Supplemental Indenture,
each of the Additional Guarantors further agrees that its Additional Guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest on any
Guaranteed Obligation is rescinded or must otherwise be restored by the Trustee
or any Holder of the Securities upon the bankruptcy or reorganization of the
Company.
Section 207. Subrogation.
-----------
In furtherance of the foregoing and not in limitation of any
other right of each of the Additional Guarantors by virtue hereof, upon the
failure of the Company to pay any Guaranteed Obligation when and as the same
shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each of the Additional Guarantors hereby promises to
and will, upon receipt of written demand by the Trustee or any Holder of the
Securities, forthwith pay, or cause to be paid, to the Holders in cash the
amount of such unpaid Guaranteed Obligations, and thereupon the Holders shall,
assign (except to the extent that such assignment would render an Additional
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any
-5-
<PAGE> 9
successor statute) the amount of the Guaranteed Obligations owed to it and paid
by such Additional Guarantor pursuant to this Additional Guarantee to such
Additional Guarantor, such assignment to be PRO RATA to the extent the
Guaranteed Obligations in question were discharged by such Additional Guarantor,
or make such other disposition thereof as such Additional Guarantor shall direct
(all without recourse to the Holders, and without any representation or warranty
by the Holders). If (a) an Additional Guarantor shall make payment to the
Holders of all or any part of the Guaranteed Obligations and (b) all the
Guaranteed Obligations and all other amounts payable under this Third
Supplemental Indenture shall be indefeasibly paid in full, the Trustee will, at
such Guarantor's request, execute and deliver to such Additional Guarantor
appropriate documents, without recourse and without representation or warranty,
necessary to evidence the transfer by subrogation to such Additional Guarantor
of an interest in the Guaranteed Obligations resulting from such payment by such
Additional Guarantor.
Section 208. Information.
-----------
Each of the Additional Guarantors assumes all responsibility
for being and keeping itself informed of the Company's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each of the Additional Guarantors assumes and incurs hereunder, and agrees that
the Trustee and the Holders of the Securities will have no duty to advise the
Additional Guarantors of information known to it or any of them regarding such
circumstances or risks.
Section 209. Subordination.
-------------
Upon payment by any Additional Guarantor of any sums to the
Holders, as provided above, all rights of such Additional Guarantor against the
Company, arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinated and junior in right of payment
to the prior indefeasible payment in full in cash of all the Guaranteed
Obligations to the Trustee; PROVIDED, HOWEVER, that any right of subrogation
that such Additional Guarantor may have pursuant to this Third Supplemental
Indenture is subject to Section 207 hereof.
Section 210. Termination.
-----------
An Additional Guarantor shall, upon the occurrence of either
of the following events, be automatically and unconditionally released and
discharged from all obligations under this Third Supplemental Indenture and its
Additional Guarantee without any action required on the part of the Trustee or
any Holder if such release and discharge will not result in any downgrade in the
rating given to the Securities by Moody's Investors Services and Standard &
Poor's Rating Services:
-6-
<PAGE> 10
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of an Additional Guarantor or
all, or substantially all, of the assets of such Additional Guarantor, which
sale or other disposition is otherwise in compliance with the terms of the
Indenture; provided, however, that such Additional Guarantor shall not be
released and discharged from its obligations under this Third Supplemental
Indenture and its Additional Guarantee if, upon consummation of such sale,
exchange, transfer or other disposition (by merger or otherwise), such
Additional Guarantor remains or becomes a guarantor under any Credit Facility;
or
(b) at the request of the Company, at any time that
none of the Credit Facilities are guaranteed by any Subsidiary of the
Company,
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Additional Guarantor not
so released will remain liable for the full amount of the principal of, premium,
if any, and interest on the Securities provided in this Third Supplemental
Indenture and its Guarantee.
Section 211. Additional Guarantees of Other Indebtedness.
-------------------------------------------
As long as the Securities are guaranteed by the Additional
Guarantors, the Company will cause each of its Subsidiaries that becomes a
guarantor in respect of (i) any Indebtedness of the Company which is outstanding
on the date hereof and (ii) any Indebtedness incurred by the Company after the
date hereof (other than in respect of asset-backed securities), to include in
any guarantee given by any such guarantor provisions similar to those set forth
in Section 210 hereof.
Section 212. Additional Guarantors.
---------------------
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become an Additional Guarantor under this Third Supplemental Indenture, if it
has not already done so or unless the Guarantor is prohibited from doing so by
applicable law or a provision of a contract to which it is a party or by which
it is bound.
Section 213. Limitation of Additional Guarantor's Liability.
----------------------------------------------
Each Additional Guarantor, other than The Kroger Co., and by
its acceptance hereof each Holder, hereby confirms that it is the intention of
all such parties that the Additional Guarantee by such Additional Guarantor not
constitute a fraudulent transfer or conveyance for purposes of Title 11 of the
United States Code, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar Federal
-7-
<PAGE> 11
of state law. To effectuate the foregoing intention, the Holders and such
Additional Guarantor hereby irrevocably agree that the obligations of such
Additional Guarantor under this Third Supplemental Indenture and its Additional
Guarantee shall be limited to the maximum amount which, after giving effect to
all other contingent and fixed liabilities of such Additional Guarantor, and
after giving effect to any collections from or payments made by or on behalf of,
any other Additional Guarantor in respect of the obligations of such Additional
Guarantor under its Additional Guarantee or pursuant to its contribution
obligations under this Third Supplemental Indenture, will result in the
obligations of such Additional Guarantor under its Additional Guarantee not
constituting such fraudulent transfer or conveyance.
Section 214. Contribution from Other Additional Guarantors.
---------------------------------------------
Each Additional Guarantor that makes a payment or distribution
under its Additional Guarantee shall be entitled to a contribution from each
other Additional Guarantor in a pro rata amount based on the net assets of each
Additional Guarantor, determined in accordance with generally accepted
accounting principles in effect in the United States of America as of the date
hereof.
Section 215. No Obligation to Take Action Against the Company.
------------------------------------------------
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Guarantors of their liabilities and
obligations under their Additional Guarantee.
Section 216. Dealing with the Company and Others.
-----------------------------------
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Additional Guarantor hereunder and without the consent of or notice to any
Additional Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral,
-8-
<PAGE> 12
mortgages or other security given by the Company or any third party with respect
to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 217. Subordination of Guarantee.
--------------------------
The obligations of each Guarantor to the Holders of the
Securities and to the Trustee pursuant to the Guarantee and this Indenture are
expressly subordinate and subject in right of payment to the prior payment in
full in cash of all Senior Indebtedness of such Guarantor, to the extent and in
the manner provided in Article Three.
ARTICLE THREE
-------------
SUBORDINATION OF ADDITIONAL GUARANTEE OBLIGATIONS
Section 301. Additional Guarantee Obligations Subordinated to Senior
-------------------------------------------------------
Indebtedness of Additional Guarantors.
-------------------------------------
Article Twelve of the Indenture is hereby incorporated by
reference herein in its entirety herein, except that each reference to
"Subsidiary Guarantor" shall become a reference to "Additional Guarantor," each
reference to "Guarantee Obligations" shall become a reference to "Additional
Guarantee Obligations" and each reference to "Guarantor Senior Indebtedness"
shall become a reference to "Additional Guarantor Senior Indebtedness."
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. Miscellaneous.
-------------
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Third Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Third Supplemental Indenture.
-9-
<PAGE> 13
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Third Supplemental Indenture.
(c) Each of the Company, the Subsidiary Guarantors and the
Trustee makes and reaffirms as of the date of execution of this Third
Supplemental Indenture all of its respective representations, covenants and
agreements set forth in the Indenture.
(d) All covenants and agreements in this Third Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Third Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Third Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Third
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Third
Supplemental Indenture as so modified or excluded, as the case may be.
(h) This Third Supplemental Indenture shall be governed by and
construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Third Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Third Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
-10-
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
<TABLE>
<S> <C>
Attest: RALPHS GROCERY COMPANY
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: Each of the Subsidiary Guarantors Listed on
Schedule I hereto, as Subsidiary Guarantor of
the Securities
(Bruce M. Gack) By*: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
* Signing as duly authorized officer for each such Subsidiary Guarantor.
Attest: THE KROGER CO., as Additional Guarantor
of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest**: Each of the Additional Guarantors Listed on
Schedule II hereto, as Additional Guarantor of
the Securities
(Bruce M. Gack) By:** (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
_____________________
</TABLE>
** Signing as duly authorized officer for each such Additional Guarantor.
-11-
<PAGE> 15
<TABLE>
<S> <C>
Attest: HENPIL, INC., as Additional Guarantor of the
Securities
WYDIV, INC., as Additional Guarantor of the
Securities
By: (Steven McMillan)
- ----------------------------------- -------------------------------
Name: Steven McMillan
Title: Vice President
Attest: RICHIE'S, INC., as Additional Guarantor of
the Securities
By: (Keith C. Larson)
- ----------------------------------- -------------------------------
Name: Keith C. Larson
Title: Vice President
Attest: VINE COURT ASSURANCE
INCORPORATED, as Additional Guarantor of
the Securities
(Beth Van Olfen) By: (Bruce M. Gack)
- ----------------------------------- -------------------------------
Beth Van Olfen, Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO., as
Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- --------------------------------- -------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: Vice President
</TABLE>
-12-
<PAGE> 16
Attest: UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
_____________________________
By: _______________________
Name:
Title:
-13-
<PAGE> 17
STATE OF OHIO )
) SS:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally
came Paul W. Heldman, to me known, who, being by me duly sworn, did depose and
say that he is Vice President of Ralphs Grocery Company and Vice President of
each of the Guarantors Listed on Schedule I hereto, and Vice President of
each of the Additional Guarantors listed on Schedule II hereto, and Senior Vice
President of The Kroger Co., and President of Kroger Dedicated Logistics Co.,
corporations described in and which executed the foregoing instrument; that he
knows the seals of said corporations; that the seals affixed to said instrument
are such corporate seals; that they were so affixed by authority of the Boards
of Directors of said corporations, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
--------------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
STATE OF TEXAS )
) SS:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came
Steven McMillan, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Barbara Edwards)
--------------------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 19, 2001
<PAGE> 18
STATE OF TEXAS )
) SS:
COUNTY OF EL PASO )
On the 30th day of July, 1999, before me personally came
Keith C. Larson, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Richie's, Inc., one of the corporations described
in and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
(Mercedes Flores)
------------------------------
Notary Public
Mercedes Flores [Notarial Seal]
Notary Public, State of Texas
My Commission Expires 10/23/99
STATE OF OHIO )
) SS:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Bruce M. Gack, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
<PAGE> 19
SCHEDULE I
Subsidiary Guarantors
---------------------
Name of Subsidiary Guarantor State of Organization
---------------------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less GM, Inc. California
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
<PAGE> 20
SCHEDULE II
Additional Guarantors
---------------------
Name of Additional Guarantor State of
- ---------------------------- --------
Organization
------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited
By: KRGP Inc., the General Partner partnership)
Kroger Limited Partnership II Ohio (limited
By: KRGP Inc., the General Partner partnership)
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania
(limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
<PAGE> 21
Name of Additional Guarantor State of
- ---------------------------- --------
Organization
------------
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
<PAGE> 1
EXHIBIT 4.14
----------------------------------------------------------------------
QUALITY FOOD CENTERS, INC.
and certain Guarantors
TO
U.S. BANK TRUST NATIONAL ASSOCIATION
Trustee
----------
SECOND SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of March 19, 1997
----------
$150,000,000 8.70% Senior Subordinated Notes due 2007
----------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
-----------------
ARTICLE ONE
-----------
DEFINITIONS
<TABLE>
<CAPTION>
<S> <C> <C>
Section 101. Definitions.......................................................2
</TABLE>
<TABLE>
<CAPTION>
ARTICLE TWO
-----------
ADDITIONAL GUARANTEE
<S> <C> <C>
Section 201. Additional Guarantee.............................................3
--------------------
Section 202. Waiver of Demand.................................................4
----------------
Section 203. Additional Guarantee of Payment..................................4
-------------------------------
Section 204. No Discharge or Diminishment of Additional Guarantee.............4
----------------------------------------------------
Section 205. Defenses of Company Waived.......................................5
--------------------------
Section 206. Continued Effectiveness..........................................5
-----------------------
Section 207. Subrogation......................................................5
-----------
Section 208. Information......................................................6
-----------
Section 209. Subordination....................................................6
-------------
Section 210. Termination......................................................6
-----------
Section 211. Additional Guarantees of Other Indebtedness......................7
-------------------------------------------
Section 212. Additional Guarantors............................................7
---------------------
Section 213. Limitation of Additional Guarantor's Liability...................7
----------------------------------------------
Section 214. Contribution from Other Additional Guarantors....................8
---------------------------------------------
Section 215. No Obligation to Take Action Against the Company.................8
------------------------------------------------
Section 216. Dealing with the Company and Others..............................8
-----------------------------------
</TABLE>
-i-
<PAGE> 3
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
Section 301. Additional Guarantee Obligations Subordinated to Senior Indebtedness of
-----------------------------------------------------------------------
Additional Guarantors........................................................9
---------------------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE FOUR
------------
MISCELLANEOUS
<S> <C> <C>
Section 401. Miscellaneous................................................................9
-------------
</TABLE>
-ii-
<PAGE> 4
SECOND SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this
"Second Supplemental Indenture"), among Quality Food Centers, Inc., a
corporation duly organized and existing under the laws of the State of
Washington (herein called the "Company"), having its principal office at 10112
NE 10th Street, Suite 201, Bellevue, Washington 98004, each of the guarantors
signatory hereto as set forth on Schedule I (collectively, the "Pre-Existing
Guarantors") each of the additional guarantors signatory hereto, as set forth on
the signature pages and Schedule II (collectively, the "Additional Guarantors"
and collectively with the Pre-Existing Guarantors the "Guarantors"), and U.S.
Bank Trust National Association, a national banking association, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of March 19, 1997 (as amended and supplemented,
the "Indenture") providing for the issuance of the $150,000,000 8.70% Senior
Subordinated Notes due 2007 (the "Securities").
The Indenture has been supplemented by the First Supplemental
Indenture, dated as of March 10, 1998 (the "First Supplemental Indenture").
Each of the Additional Guarantors has duly authorized the
issuance of a guarantee of the Securities, as set forth herein, and to provide
therefor, each of the Additional Guarantors has duly authorized the execution
and delivery of this Second Supplemental Indenture.
Section 9.1(12) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, the
Guarantors, when authorized by Board Resolutions (or, if any Guarantor is not a
corporation, when otherwise appropriately authorized) and the Trustee, at any
time and from time to time, may enter into one or more indentures supplemental
to the Indenture, in form satisfactory to the Trustee, to make change that does
not adversely affect the rights of any Holder of Securities in any material
respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Second Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities.
All things necessary to make this Second Supplemental
Indenture a valid agreement of the Company and each of the Guarantors and a
valid amendment of, and supplement to the Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
Section 101. Definitions.
-----------
For all purposes of this Second Supplemental Indenture:
(1) Capitalized terms used herein without definition shall have
the meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Second
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Second Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Second Supplemental Indenture.
(4) "Additional Guarantee" has the meaning specified in Section 201.
(5) "Additional Guaranteed Obligations" has the meaning specified in
Section 201.
(6) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by The Kroger Co. or Fred
Meyer, Inc. and outstanding on the date of this Second Supplemental Indenture,
and any refinancing or other restructuring of any such agreement or facility.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Senior Indebtedness" means, with respect to any Additional
Guarantor, the principal of (and premium, if any) and interest on, and all other
amounts payable in respect of, (a) all Indebtedness of such Guarantor, whether
outstanding on the date of the Indenture or thereafter Incurred, (b) any
obligations of such Additional Guarantor under interest rate swaps, caps,
collars and similar arrangements, (c) any obligations of such
-2-
<PAGE> 6
Additional Guarantor under foreign currency hedges entered into in respect of
any such Indebtedness or obligation and (d) any amendments, renewals,
extensions, modifications, and refundings of any such Indebtedness or
obligation, except (i) any Indebtedness or obligation owed to a Subsidiary, (ii)
any Indebtedness or obligation which by the terms of the instrument creating or
evidencing the same is not superior in right of payment to such Additional
Guarantor's Additional Guarantee, (iii) any Indebtedness or obligation which is
subordinated or junior in any respect to any other Indebtedness or obligation of
such Additional Guarantor, and (iv) any indebtedness or obligation constituting
a trade account payable of such Additional Guarantor. Any obligation under any
Senior Indebtedness shall continue to constitute Senior Indebtedness despite a
determination that the Incurrence of such obligation by an Additional Guarantor
was a preference under Section 547(b) of Title 11 of the United States Code (or
any successor thereto) or was a fraudulent conveyance or transfer under Federal
or State Law.
ARTICLE TWO
-----------
ADDITIONAL GUARANTEE
Section 201. Additional Guarantee.
--------------------
Each Additional Guarantor hereby jointly and severally fully
and unconditionally guarantees (each an "Additional Guarantee") to each Holder
of a Security authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
the Indenture or the Securities or the obligations of the Company or any other
Additional Guarantor to the Holders or the Trustee hereunder or thereunder, that
(a) the principal of, premium, if any, and interest on the Securities will be
duly and punctually paid in full when due, whether at maturity, upon redemption,
by acceleration or otherwise, and interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Securities and all other
obligations of the Company or the Additional Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Guaranteed Obligations") will be
promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Guaranteed Obligations, the same will be promptly paid
in full when due or performed in accordance with the terms of the extension or
renewal, whether at Stated Maturity, by acceleration or otherwise. If the
Company shall fail to pay when due, or to perform, any Guaranteed Obligations,
for whatever reason, each Additional Guarantor shall be obligated to pay, or to
perform or cause the performance of, the same immediately. An Event of Default
under the Indenture or the Securities shall constitute an event of default under
this Additional Guarantee, and shall entitle the Holders of Securities to
accelerate the Guaranteed Obligations of the Additional Guarantor hereunder in
the same manner and to the same extent as the Guaranteed Obligations of the
Company.
-3-
<PAGE> 7
Each Additional Guarantor hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not an Additional Guarantee is affixed to any
particular Security, or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a Guarantor.
Each Additional Guarantor further agrees that, as between it,
on the one hand, and the Holders of Securities and the Trustee, on the other
hand, (a) the maturity of the Guaranteed Obligations may be accelerated as
provided in Article Six of the Indenture for the purposes of its Additional
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Guaranteed Obligations, and (b) in the event
of any acceleration of such Guaranteed Obligations as provided in Article Six of
the Indenture, such Guaranteed Obligations (whether or not due and payable)
shall forthwith become due and payable by such Additional Guarantor for the
purposes of its Additional Guarantee.
Section 202. Waiver of Demand.
----------------
To the fullest extent permitted by applicable law, each of the
Additional Guarantors waives presentment to, demand of payment from and protest
of any of the Guaranteed Obligations, and also waives notice of acceptance of
its Additional Guarantee and notice of protest for nonpayment.
Section 203. Additional Guarantee of Payment.
-------------------------------
Each of the Additional Guarantors further agrees that its
Additional Guarantee constitutes an Additional Guarantee of payment when due and
not of collection, and waives any right to require that any resort be had by the
Trustee or any Holder of the Securities to the security, if any, held for
payment of the Guaranteed Obligations.
Section 204. No Discharge or Diminishment of Additional Guarantee.
----------------------------------------------------
Subject to Section 210 of this Second Supplemental Indenture,
the obligations of each of the Additional Guarantors hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason
(other than the indefeasible payment in full in cash of the Guaranteed
Obligations), including any claim of waiver, release, surrender, alteration or
compromise of any of the Guaranteed Obligations, and shall not be subject to any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Guaranteed Obligations
or otherwise. Without limiting the generality of the foregoing,
-4-
<PAGE> 8
the obligations of each of the Additional Guarantors hereunder shall not be
discharged or impaired or otherwise affected by the failure of the Trustee or
any Holder of the Securities to assert any claim or demand or to enforce any
remedy under the Indenture or the Securities, any other Additional Guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Guaranteed Obligations, or by any other act or omission that
may or might in any manner or to any extent vary the risk of any Additional
Guarantor or that would otherwise operate as a discharge of any Additional
Guarantor as a matter of law or equity (other than the indefeasible payment in
full in cash of all the Guaranteed Obligations).
Section 205. Defenses of Company Waived.
--------------------------
To the extent permitted by applicable law, each of the
Additional Guarantors waives any defense based on or arising out of any defense
of the Company or any other Guarantor or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Company, other than final and indefeasible payment in
full in cash of the Guaranteed Obligations. Each of the Additional Guarantors
waives any defense arising out of any such election even though such election
operates to impair or to extinguish any right of reimbursement or subrogation or
other right or remedy of each of the Additional Guarantors against the Company
or any security.
Section 206. Continued Effectiveness.
-----------------------
Subject to Section 210 of this Second Supplemental Indenture,
each of the Additional Guarantors further agrees that its Additional Guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest on any
Guaranteed Obligation is rescinded or must otherwise be restored by the Trustee
or any Holder of the Securities upon the bankruptcy or reorganization of the
Company.
Section 207. Subrogation.
-----------
In furtherance of the foregoing and not in limitation of any
other right of each of the Additional Guarantors by virtue hereof, upon the
failure of the Company to pay any Guaranteed Obligation when and as the same
shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each of the Additional Guarantors hereby promises to
and will, upon receipt of written demand by the Trustee or any Holder of the
Securities, forthwith pay, or cause to be paid, to the Holders in cash the
amount of such unpaid Guaranteed Obligations, and thereupon the Holders shall,
assign (except to the extent that such assignment would render an Additional
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any
-5-
<PAGE> 9
successor statute) the amount of the Guaranteed Obligations owed to it and paid
by such Additional Guarantor pursuant to this Additional Guarantee to such
Additional Guarantor, such assignment to be PRO RATA to the extent the
Guaranteed Obligations in question were discharged by such Additional Guarantor,
or make such other disposition thereof as such Additional Guarantor shall direct
(all without recourse to the Holders, and without any representation or warranty
by the Holders). If (a) an Additional Guarantor shall make payment to the
Holders of all or any part of the Guaranteed Obligations and (b) all the
Guaranteed Obligations and all other amounts payable under this Second
Supplemental Indenture shall be indefeasibly paid in full, the Trustee will, at
such Additional Guarantor's request, execute and deliver to such Additional
Guarantor appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to such Additional
Guarantor of an interest in the Guaranteed Obligations resulting from such
payment by such Additional Guarantor.
Section 208. Information.
-----------
Each of the Additional Guarantors assumes all responsibility
for being and keeping itself informed of the Company's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each of the Additional Guarantors assumes and incurs hereunder, and agrees that
the Trustee and the Holders of the Securities will have no duty to advise the
Additional Guarantors of information known to it or any of them regarding such
circumstances or risks.
Section 209. Subordination.
-------------
Upon payment by any Additional Guarantor of any sums to the
Holders, as provided above, all rights of such Additional Guarantor against the
Company, arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinated and junior in right of payment
to the prior indefeasible payment in full in cash of all the Guaranteed
Obligations to the Trustee; PROVIDED, HOWEVER, that any right of subrogation
that such Additional Guarantor may have pursuant to this Second Supplemental
Indenture is subject to Section 207 hereof.
Section 210. Termination.
-----------
An Additional Guarantor shall, upon the occurrence of either
of the following events, be automatically and unconditionally be released and
discharged from all obligations under this Second Supplemental Indenture and its
Additional Guarantee without any action required on the part of the Trustee or
any Holder if such release and discharge will not result in any downgrade in the
rating given to the Securities by Moody's Investors Service and Standard and
Poor's Ratings Services:
-6-
<PAGE> 10
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of an Additional Guarantor or
all, or substantially all, of the assets of such Additional Guarantor, which
sale or other disposition is otherwise in compliance with the terms of the
Indenture; provided, however, that such Additional Guarantor shall not be
released and discharged from its obligations under this Second Supplemental
Indenture and its Additional Guarantee if, upon consummation of such sale,
exchange, transfer or other disposition (by merger or otherwise), such
Additional Guarantor remains or becomes an Additional Guarantor under any Credit
Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Additional Guarantor not
so released will remain liable for the full amount of the principal of, premium,
if any, and interest on the Notes provided in this Second Supplemental Indenture
and its Guarantee.
Section 211. Additional Guarantees of Other Indebtedness.
-------------------------------------------
As long as the Securities are guaranteed by the Additional
Guarantors, the Company will cause each of its Subsidiaries that becomes a
guarantor in respect of (i) any Indebtedness of the Company which is outstanding
on the date hereof and (ii) any Indebtedness incurred by the Company after the
date hereof (other than in respect of asset-backed securities), to include in
any guarantee given by such guarantor provisions similar to those set forth in
Section 210 hereof.
Section 212. Additional Guarantors.
---------------------
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become an Additional Guarantor under this Second Supplemental Indenture, if it
has not already done so or unless the Additional Guarantor is prohibited from
doing so by applicable law or a provision of a contract to which it is a party
or by which it is bound.
Section 213. Limitation of Additional Guarantor's Liability.
----------------------------------------------
Each Additional Guarantor, other than The Kroger Co., and by
its acceptance hereof each Holder, hereby confirms that it is the intention of
all such parties that the Additional Guarantee by such Guarantor not constitute
a fraudulent transfer or conveyance for purposes of Title 11 of the United
States Code, the Uniform Fraudulent
-7-
<PAGE> 11
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal of
state law. To effectuate the foregoing intention, the Holders and such
Additional Guarantor hereby irrevocably agree that the obligations of such
Additional Guarantor under this Second Supplemental Indenture and its Additional
Guarantee shall be limited to the maximum amount which, after giving effect to
all other contingent and fixed liabilities of such Guarantor, and after giving
effect to any collections from or payments made by or on behalf of, any other
Additional Guarantor in respect of the obligations of such Guarantor under its
Guarantee or pursuant to its contribution obligations under this Second
Supplemental Indenture, will result in the obligations of such Additional
Guarantor under its Additional Guarantee not constituting such fraudulent
transfer or conveyance.
Section 214. Contribution from Other Additional Guarantors.
---------------------------------------------
Each Additional Guarantor that makes a payment or distribution
under its Additional Guarantee shall be entitled to a contribution from each
other Additional Guarantor in a pro rata amount based on the net assets of each
Additional Guarantor, determined in accordance with generally accepted
accounting principles in effect in the United States of America as of the date
hereof.
Section 215. No Obligation to Take Action Against the Company.
------------------------------------------------
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Guaranteed Obligations or against the
Company or any other Person or any property of the Company or any other Person
before the Trustee, such Holder or such other Person is entitled to demand
payment and performance by any or all Additional Guarantors of their liabilities
and obligations under their Additional Guarantee.
Section 216. Dealing with the Company and Others.
-----------------------------------
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Additional Guarantor hereunder and without the consent of or notice to any
Additional Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral,
-8-
<PAGE> 12
mortgages or other security given by the Company or any third party with respect
to the Guaranteed Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Guaranteed Obligations as the Holders may
see fit or change any such application in whole or in part from time to time as
the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. Additional Guarantee Obligations Subordinated to Senior
-------------------------------------------------------
Indebtedness of Additional Guarantors.
-------------------------------------
Article Twelve of the Indenture is hereby incorporated by
reference herein in its entirety herein, except that each reference to
"Guarantor" shall become a reference to "Additional Guarantor" and each
reference to "Senior Debt" shall become a reference to "Additional Guarantor
Senior Indebtedness".
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. Miscellaneous.
-------------
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Second Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Second Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Second Supplemental Indenture.
(c) Each of the Company, the Pre-Existing Guarantors, and the
Trustee makes and reaffirms as of the date of execution of this Second
Supplemental Indenture all of its respective representations, covenants and
agreements set forth in the Indenture.
-9-
<PAGE> 13
(d) All covenants and agreements in this Second Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Second Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Second Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Second
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Second
Supplemental Indenture as so modified or excluded, as the case may be.
(h) This Second Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Second Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Second Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
-10-
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
<TABLE>
<S> <C>
Attest: QUALITY FOOD CENTERS, INC.
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Securities
Attest*:
(Bruce M. Gack) By*: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
THE KROGER CO., as Additional Guarantor
of the Securities
Attest:
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
</TABLE>
* Signing as duly authorized officer for each such Guarantor.
-11-
<PAGE> 15
<TABLE>
<S> <C>
Each of the Additional Guarantors Listed on
Schedule II hereto, as Additional Guarantor
of the Securities
Attest**:
(Bruce M. Gack) By**: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
HENPIL, INC., as Additional Guarantor
of the Securities
Attest: WYDIV, INC., as Additional Guarantor
of the Securities
By: (Steven McMillan)
- -------------------------------- -------------------------------
Name: Steven McMillan
Title: Vice President
RICHIE'S, INC., as Additional Guarantor
of the Securities
Attest:
By: (Keith C. Larson)
- -------------------------------- -------------------------------
Name: Keith C. Larson
Title: Vice President
</TABLE>
** Signing as duly authorized officer for each such Additional Guarantor.
-12-
<PAGE> 16
Attest: VINE COURT ASSURANCE
INCORPORATED, as Additional Guarantor
of the Securities
(Beth Van Oflen) By: (Bruce M. Gack)
- ----------------------------------- ---------------------------------
Beth Van Oflen, Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
Attest: KROGER DEDICATED LOGISTICS CO., as
Additional Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- ----------------------------------- ---------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: President
-13-
<PAGE> 17
Attest: U.S. BANK TRUST NATIONAL
ASSOCIATION, as Trustee
By: ________________________________
Name:
________________________________ Title:
-14-
<PAGE> 18
STATE OF OHIO )
) SS:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Paul W. Heldman, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Quality Food Centers, Inc. and Vice President of
each of the Guarantors Listed on Schedule I and Vice President of Additional
Guarantors listed on Schedule II hereto, and Senior Vice President of The Kroger
Co., and President of Kroger Dedicated Logistics Co., corporations described in
and which executed the foregoing instrument; that he knows the seals of said
corporations; that the seals affixed to said instrument are such corporate
seals; that they were so affixed by authority of the Boards of Directors of said
corporations, and that he signed his name thereto by like authority.
(Brenda R. Andes)
--------------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
STATE OF TEXAS )
) SS:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came
Steven McMillan, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Henpil, Inc. and Wydiv, Inc., corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seals affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Barbara Edwards)
--------------------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 19, 2001
<PAGE> 19
SCHEDULE I
Guarantors
----------
Name of Guarantor State of Organization
----------------- ---------------------
Hughes Markets, Inc. California
KU Acquisition Corporation Washington
Quality Food Holdings, Inc. Delaware
<PAGE> 20
SCHEDULE II
Additional Guarantors
---------------------
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
<PAGE> 21
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Hughes Realty, Inc. California
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
<PAGE> 1
EXHIBIT 4.15
----------------------------------------------------------------------
SMITH'S FOOD & DRUG CENTERS, INC.
and certain Guarantors
TO
STATE STREET BANK
AND TRUST COMPANY
Trustee
----------
SECOND SUPPLEMENTAL INDENTURE
Dated as of July 30, 1999
TO
INDENTURE
Dated as of May 23, 1996
----------
$575,000,000 11 1/4% Senior Subordinated Notes due 2007
----------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
ARTICLE ONE
-----------
DEFINITIONS
<S> <C> <C>
Section 101. Definitions.......................................................2
-----------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE TWO
-----------
ADDITIONAL GUARANTEE
<S> <C> <C>
Section 201. Additional Guarantee..............................................3
--------------------
Section 202. Waiver of Demand..................................................4
----------------
Section 203. Additional Guarantee of Payment...................................4
-------------------------------
Section 204. No Discharge or Diminishment of Additional Guarantee..............4
----------------------------------------------------
Section 205. Defenses of Company Waived........................................5
--------------------------
Section 206. Continued Effectiveness...........................................5
-----------------------
Section 207. Subrogation.......................................................5
-----------
Section 208. Information.......................................................6
-----------
Section 209. Subordination.....................................................6
-------------
Section 210. Termination.......................................................6
-----------
Section 211. Additional Guarantees of Other Indebtedness.......................7
-------------------------------------------
Section 212. Additional Guarantors.............................................7
---------------------
Section 213. Limitation of Additional Guarantor's Liability....................7
----------------------------------------------
Section 214. Contribution from Other Additional Guarantors.....................8
---------------------------------------------
Section 215. No Obligation to Take Action Against the Company..................8
------------------------------------------------
Section 216. Dealing with the Company and Others...............................8
-----------------------------------
Section 217. Subordination of Guarantee........................................9
--------------------------
</TABLE>
-i-
<PAGE> 3
<TABLE>
<CAPTION>
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
<S> <C> <C>
Section 301. Guarantee Obligations Subordinated to Senior Indebtedness of Guarantors.........9
-----------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ARTICLE FOUR
------------
MISCELLANEOUS
<S> <C> <C>
Section 401. Miscellaneous...................................................................9
-------------
</TABLE>
-ii-
<PAGE> 4
SECOND SUPPLEMENTAL INDENTURE, dated as of July 30, 1999 (this
"Second Supplemental Indenture"), among Smith's Food & Drug Centers, Inc., a
corporation duly organized and existing under the laws of the State of Delaware
(herein called the "Company") having its principal office at 1550 S. Redwood
Road, Salt Lake City, Utah 84104, and each of the Additional Guarantors
signatory hereto as set forth on the signature pages and on Schedule I
(collectively, the "Additional Guarantors" and collectively with any persons who
become guarantors under Section 5.17 of the Indenture (as defined below), the
"Guarantors"), and State Street Bank and Trust Company, as Trustee (herein
called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of May 23, 1996 (as amended and supplemented, the
"Indenture") providing for the issuance of the $575,00,000 11 1/4% Senior
Subordinated Notes due 2007 (collectively, the "Securities").
The Indenture has been supplemented by the First Supplemental
Indenture, dated as of August 25, 1997 (the "First Supplemental Indenture").
Each of the Additional Guarantors has duly authorized the
issuance of a guarantee of the Securities, as set forth herein, and to provide
therefor, each of the Additional Guarantors has duly authorized the execution
and delivery of this Second Supplemental Indenture.
Section 10.01(3) of the Indenture provides that, without the
consent of any Holders, the Company and the Guarantors (if any), when authorized
by a Board Resolution, and the Trustee, together, may amend or supplement the
Indenture, the Securities, or the Guarantees to make any other change that does
not adversely affect the rights of any Holder of Securities in any material
respect.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Second Supplemental Indenture to amend and
supplement the Indenture in certain respects with respect to the Securities.
All things necessary to make this Second Supplemental
Indenture a valid agreement of the Company and each of the Guarantors, and a
valid amendment of, and supplement to the Indenture, have been done.
-1-
<PAGE> 5
NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and each
of the Guarantors hereby covenants and agrees with the Trustee and its successor
or successors in said trust under the Indenture, as follows:
ARTICLE ONE
-----------
DEFINITIONS
Section 101. Definitions.
-----------
For all purposes of this Second Supplemental Indenture:
(1) Capitalized terms used herein without definition shall
have the meanings specified in the Indenture;
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this Second
Supplemental Indenture and, where so specified, to the Articles and Sections of
the Indenture as supplemented by this Second Supplemental Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto", "hereunder" and
"herewith" refer to this Second Supplemental Indenture.
(4) "Additional Guarantee" has the meaning specified in Section 201.
(5) "Additional Guaranteed Obligations" has the meaning specified in
Section 201.
(6) "Credit Facility" means any credit agreement, loan agreement, or
credit facility, whether syndicated or not, involving the extension of credit by
banks or other credit institutions, entered into by The Kroger Co. or Fred
Meyer, Inc. and outstanding on the date of this Second Supplemental Indenture,
and any refinancing or other restructuring of any such agreement or facility.
(7) "Holder" means any Holder of any Security pursuant to, and in
accordance with the terms of, the Indenture.
(8) "Senior Indebtedness" means, with respect to any Additional
Guarantor, the principal of (and premium, if any) and interest on, and all other
amounts payable in respect of, (a) all Indebtedness of such Guarantor, whether
outstanding on the date of the Indenture or thereafter Incurred, (b) any
obligations of such Additional Guarantor under interest rate swaps, caps,
collars and similar arrangements, (c) any obligations of such Additional
Guarantor under foreign currency hedges entered into in respect of any such
-2-
<PAGE> 6
Indebtedness or obligation and (d) any amendments, renewals, extensions,
modifications, and refundings of any such Indebtedness or obligation, except (i)
any Indebtedness or obligation owed to a Subsidiary, (ii) any Indebtedness or
obligation which by the terms of the instrument creating or evidencing the same
is not superior in right of payment to such Additional Guarantor's Additional
Guarantee, (iii) any Indebtedness or obligation which is subordinated or junior
in any respect to any other Indebtedness or obligation of such Additional
Guarantor, and (iv) any indebtedness or obligation constituting a trade account
payable of such Additional Guarantor. Any obligation under any Senior
Indebtedness shall continue to constitute Senior Indebtedness despite a
determination that the Incurrence of such obligation by an Additional Guarantor
was a preference under Section 547(b) of Title 11 of the United States Code (or
any successor thereto) or was a fraudulent conveyance or transfer under Federal
or State Law.
ARTICLE TWO
-----------
ADDITIONAL GUARANTEE
Section 201. Additional Guarantee.
--------------------
Each Additional Guarantor hereby jointly and severally fully
and unconditionally guarantees (each an "Additional Guarantee") to each Holder
of a Security authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
the Indenture or the Securities or the obligations of the Company or any other
Additional Guarantor to the Holders or the Trustee hereunder or thereunder, that
(a) the principal of, premium, if any, and interest on the Securities will be
duly and punctually paid in full when due, whether at maturity, upon redemption,
by acceleration or otherwise, and interest on the overdue principal and (to the
extent permitted by law) interest, if any, on the Securities and all other
obligations of the Company or the Additional Guarantor to the Holders of or the
Trustee under the Indenture or the Securities hereunder (including fees,
expenses or others) (collectively, the "Additional Guaranteed Obligations") will
be promptly paid in full or performed, all in accordance with the terms of the
Indenture and the Securities; and (b) in case of any extension of time of
payment or renewal of any Additional Guaranteed Obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at Stated Maturity, by acceleration or otherwise.
If the Company shall fail to pay when due, or to perform, any Additional
Guaranteed Obligations, for whatever reason, each Additional Guarantor shall be
obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Securities shall
constitute an event of default under this Additional Guarantee, and shall
entitle the Holders of Securities to accelerate the Additional Guaranteed
Obligations of the Additional Guarantor hereunder in the same manner and to the
same extent as the Additional Guaranteed Obligations of the Company.
-3-
<PAGE> 7
Each Additional Guarantor hereby agrees that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not an Additional Guarantee is affixed to any
particular Security, or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a Guarantor.
Each Additional Guarantor further agrees that, as between it,
on the one hand, and the Holders of Securities and the Trustee, on the other
hand, (a) the maturity of the Additional Guaranteed Obligations may be
accelerated as provided in Article Seven of the Indenture for the purposes of
its Additional Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Additional Guaranteed
Obligations, and (b) in the event of any acceleration of such Additional
Guaranteed Obligations as provided in Article Seven of the Indenture, such
Additional Guaranteed Obligations (whether or not due and payable) shall
forthwith become due and payable by such Additional Guarantor for the purposes
of its Additional Guarantee.
Section 202. Waiver of Demand.
----------------
To the fullest extent permitted by applicable law, each of the
Additional Guarantors waives presentment to, demand of payment from and protest
of any of the Additional Guaranteed Obligations, and also waives notice of
acceptance of its Additional Guarantee and notice of protest for nonpayment.
Section 203. Additional Guarantee of Payment.
-------------------------------
Each of the Additional Guarantors further agrees that its
Additional Guarantee constitutes a guarantee of payment when due and not of
collection, and waives any right to require that any resort be had by the
Trustee or any Holder of the Securities to the security, if any, held for
payment of the Additional Guaranteed Obligations.
Section 204. No Discharge or Diminishment of Additional Guarantee.
----------------------------------------------------
Subject to Section 210 of this Second Supplemental Indenture,
the obligations of each of the Additional Guarantors hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason
(other than the indefeasible payment in full in cash of the Additional
Guaranteed Obligations), including any claim of waiver, release, surrender,
alteration or compromise of any of the Additional Guaranteed Obligations, and
shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Additional Guaranteed Obligations or otherwise. Without
limiting the generality of the foregoing, the obligations of each of the
Additional Guarantors hereunder shall not be discharged or impaired or otherwise
affected by the failure of the
-4-
<PAGE> 8
Trustee or any Holder of the Securities to assert any claim or demand or to
enforce any remedy under the Indenture or the Securities, any other guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Additional Guaranteed Obligations, or by any other act or
omission that may or might in any manner or to any extent vary the risk of any
Additional Guarantor or that would otherwise operate as a discharge of any
Additional Guarantor as a matter of law or equity (other than the indefeasible
payment in full in cash of all the Additional Guaranteed Obligations).
Section 205. Defenses of Company Waived.
--------------------------
To the extent permitted by applicable law, each of the
Additional Guarantors waives any defense based on or arising out of any defense
of the Company or any other Guarantor or the unenforceability of the Additional
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Company, other than final and indefeasible
payment in full in cash of the Additional Guaranteed Obligations. Each of the
Additional Guarantors waives any defense arising out of any such election even
though such election operates to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of each of the Additional
Guarantors against the Company or any security.
Section 206. Continued Effectiveness.
-----------------------
Subject to Section 210 of this Second Supplemental Indenture,
each of the Additional Guarantors further agrees that its Additional Guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of principal of or interest on any
Additional Guaranteed Obligation is rescinded or must otherwise be restored by
the Trustee or any Holder of the Securities upon the bankruptcy or
reorganization of the Company.
Section 207. Subrogation.
-----------
In furtherance of the foregoing and not in limitation of any
other right of each of the Additional Guarantors by virtue hereof, upon the
failure of the Company to pay any Additional Guaranteed Obligation when and as
the same shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each of the Additional Guarantors hereby promises to
and will, upon receipt of written demand by the Trustee or any Holder of the
Securities, forthwith pay, or cause to be paid, to the Holders in cash the
amount of such unpaid Additional Guaranteed Obligations, and thereupon the
Holders shall, assign (except to the extent that such assignment would render an
Additional Guarantor a "creditor" of the Company within the meaning of Section
547 of Title 11 of the United States Code as now in effect or hereafter amended
or any comparable provision of any successor statute) the amount of the
Additional Guaranteed Obligations owed to it and paid by such Additional
Guarantor pursuant to this Additional Guarantee to such Additional Guarantor,
such assignment to be PRO RATA to the
-5-
<PAGE> 9
extent the Additional Guaranteed Obligations in question were discharged by such
Additional Guarantor, or make such other disposition thereof as such Additional
Guarantor shall direct (all without recourse to the Holders, and without any
representation or warranty by the Holders). If (a) an Additional Guarantor shall
make payment to the Holders of all or any part of the Additional Guaranteed
Obligations and (b) all the Additional Guaranteed Obligations and all other
amounts payable under this Second Supplemental Indenture shall be indefeasibly
paid in full, the Trustee will, at such Additional Guarantor's request, execute
and deliver to such Additional Guarantor appropriate documents, without recourse
and without representation or warranty, necessary to evidence the transfer by
subrogation to such Additional Guarantor of an interest in the Additional
Guaranteed Obligations resulting from such payment by such Additional Guarantor.
Section 208. Information.
-----------
Each of the Additional Guarantors assumes all responsibility
for being and keeping itself informed of the Company's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Additional Guaranteed Obligations and the nature, scope and extent of the
risks that each of the Additional Guarantors assumes and incurs hereunder, and
agrees that the Trustee and the Holders of the Securities will have no duty to
advise the Additional Guarantors of information known to it or any of them
regarding such circumstances or risks.
Section 209. Subordination.
-------------
Upon payment by any Additional Guarantor of any sums to the
Holders, as provided above, all rights of such Additional Guarantor against the
Company, arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinated and junior in right of payment
to the prior indefeasible payment in full in cash of all the Additional
Guaranteed Obligations to the Trustee; PROVIDED, HOWEVER, that any right of
subrogation that such Additional Guarantor may have pursuant to this Second
Supplemental Indenture is subject to Section 207 hereof.
Section 210. Termination.
-----------
An Additional Guarantor shall, upon the occurrence of either
of the following events, be automatically and unconditionally released and
discharged from all obligations under this Second Supplemental Indenture and its
Additional Guarantee without any action required on the part of the Trustee or
any Holder if such release and discharge will not result in any downgrade in the
rating given to the Securities by Moody's Investors Service and Standard &
Poor's Ratings Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of an Additional Guarantor or
all, or substantially all, of the assets of such Additional Guarantor, which
sale or other disposition is
-6-
<PAGE> 10
otherwise in compliance with the terms of the Indenture; provided, however, that
such Additional Guarantor shall not be released and discharged from its
obligations under this Second Supplemental Indenture and its Additional
Guarantee if, upon consummation of such sale, exchange, transfer or other
disposition (by merger or otherwise), such Additional Guarantor remains or
becomes a guarantor under any Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Additional Guarantor not
so released will remain liable for the full amount of the principal of, premium,
if any, and interest on the Securities provided in the Indenture and its
Guarantee.
Section 211. Additional Guarantees of Other Indebtedness.
-------------------------------------------
As long as the Securities are guaranteed by the Additional
Guarantors, the Company will cause each of its Subsidiaries that becomes a
guarantor in respect of (i) any Indebtedness of the Company which is outstanding
on the date hereof and (ii) any Indebtedness incurred by the Company after the
date hereof (other than in respect of asset-backed securities), to include in
such guarantee provisions similar to those set forth in Section 210 hereof.
Section 212. Additional Guarantors.
---------------------
The Company will cause each of its Subsidiaries that becomes a
guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a supplemental indenture pursuant to which it will
become an Additional Guarantor under this Second Supplemental Indenture, if it
has not already done so or unless the Guarantor is prohibited from doing so by
applicable law or a provision of a contract to which it is a party or by which
it is bound.
Section 213. Limitation of Additional Guarantor's Liability.
----------------------------------------------
Each Additional Guarantor, other than The Kroger Co., and by
its acceptance hereof each Holder, hereby confirms that it is the intention of
all such parties that the Additional Guarantee by such Additional Guarantor not
constitute a fraudulent transfer or conveyance for purposes of Title 11 of the
United States Code, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar Federal of state law. To effectuate the
foregoing intention, the Holders and such Additional Guarantor hereby
irrevocably agree that the obligations of such Additional Guarantor under this
Second Supplemental Indenture and its Additional Guarantee shall be limited to
the maximum amount which, after giving effect to all other contingent and fixed
-7-
<PAGE> 11
liabilities of such Additional Guarantor, and after giving effect to any
collections from or payments made by or on behalf of, any other Additional
Guarantor in respect of the obligations of such Additional Guarantor under its
Additional Guarantee or pursuant to its contribution obligations under this
Second Supplemental Indenture, will result in the obligations of such Additional
Guarantor under its Additional Guarantee not constituting such fraudulent
transfer or conveyance.
Section 214. Contribution from Other Additional Guarantors.
---------------------------------------------
Each Additional Guarantor that makes a payment or distribution
under its Additional Guarantee shall be entitled to a contribution from each
other Additional Guarantor in a pro rata amount based on the net assets of each
Additional Guarantor, determined in accordance with generally accepted
accounting principles in effect in the United States of America as of the date
hereof.
Section 215. No Obligation to Take Action Against the Company.
------------------------------------------------
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Additional Guaranteed Obligations or
against the Company or any other Person or any property of the Company or any
other Person before the Trustee, such Holder or such other Person is entitled to
demand payment and performance by any or all Additional Guarantors of their
liabilities and obligations under their Additional Guarantee.
Section 216. Dealing with the Company and Others.
-----------------------------------
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Additional Guarantor hereunder and without the consent of or notice to any
Additional Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Additional Guaranteed
Obligations;
(d) accept compromises or arrangements from the Company;
-8-
<PAGE> 12
(e) apply all monies at any time received from the Company or
from any security to such part of the Additional Guaranteed Obligations as the
Holders may see fit or change any such application in whole or in part from time
to time as the Holders may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 217. Subordination of Guarantee.
--------------------------
The obligations of each Guarantor to the Holders of the
Securities and to the Trustee pursuant to the Guarantee and this Indenture are
expressly subordinate and subject in right of payment to the prior payment in
full in cash of all Senior Indebtedness of such Guarantor, to the extent and in
the manner provided in Article Three.
ARTICLE THREE
-------------
SUBORDINATION OF GUARANTEE OBLIGATIONS
Section 301. Guarantee Obligations Subordinated to Senior Indebtedness of
------------------------------------------------------------
Guarantors.
----------
Article Twelve of the Indenture is hereby incorporated by
reference herein in its entirety herein, except that each reference to
"Guarantor" shall become a reference to "Additional Guarantor," each reference
to "Guarantee Obligations" shall become a reference to "Additional Guarantee
Obligations," and each reference to "Guarantor Senior Indebtedness" shall become
a reference to "Additional Guarantor Senior Indebtedness.
ARTICLE FOUR
------------
MISCELLANEOUS
Section 401. Miscellaneous.
-------------
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Second Supplemental Indenture, and agrees to perform the
same upon the terms and conditions of the Indenture, as supplemented by this
Second Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Second Supplemental Indenture.
(c) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Second Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
-9-
<PAGE> 13
(d) All covenants and agreements in this Second Supplemental
Indenture by the Company, the Guarantors and the Trustee shall bind its
respective successors and assigns, whether so expressed or not.
(e) In case any provisions in this Second Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(f) Nothing in this Second Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(g) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Second
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Second
Supplemental Indenture as so modified or excluded, as the case may be.
(h) This Second Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
(i) All amendments to the Indenture made hereby shall affect
any and all series of Securities created under the Indenture.
(j) All provisions of this Second Supplemental Indenture shall
be deemed to be incorporated in, and made a part of, the Indenture; and the
Indenture, as supplemented by this Second Supplemental Indenture, shall be read,
taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
-10-
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
<TABLE>
<S> <C>
Attest: SMITH'S FOOD & DRUG CENTERS, INC.
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Assistant Secretary Name: Paul W. Heldman
Title: Vice President
Attest: THE KROGER CO., as Additional Guarantor
of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: Vice President
Each of the Additional Guarantors Listed on
Schedule I hereto, as Additional Guarantor of
the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- ---------------------------------- -------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: Vice President
______________________
* Signing as duly authorized officer for each such Additional Guarantor.
</TABLE>
-11-
<PAGE> 15
<TABLE>
<S> <C>
Attest: HENPIL, INC., as Additional Guarantor of the
Securities
WYDIV, INC. , as Additional Guarantor of
the Securities
By: (Steven McMillan)
- ----------------------------------- -------------------------------
Name: Steven McMillan
Title: Vice President
Attest: RICHIE'S, INC., as Additional Guarantor of
the Securities
By: (Keith C. Larson)
- ----------------------------------- -------------------------------
Name: Keith C. Larson
Title: Vice President
Attest: VINE COURT ASSURANCE
INCORPORATED, as Additional Guarantor
of the Securities
(Beth Van Oflen) By: (Bruce M. Gack)
- ----------------------------------- -------------------------------
Beth Van Oflen, Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
</TABLE>
-12-
<PAGE> 16
<TABLE>
<S> <C>
Attest: KROGER DEDICATED LOGISTICS CO., as
Additional Guarantor of the Securities
(Bruce M. Gack) By: (Paul W. Heldman)
- -------------------------------- -------------------------------
Bruce M. Gack, Secretary Name: Paul W. Heldman
Title: Vice President
</TABLE>
-13-
<PAGE> 17
Attest: STATE STREET BANK AND TRUST
COMPANY, as Trustee
________________________________ By: ______________________________
Name:
Title:
-14-
<PAGE> 18
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Paul W. Heldman, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Smith's Food & Drug Centers, Inc. and Vice
President of each of the Additional Guarantors Listed on Schedule I and
Senior Vice President of The Kroger Co., and President of Kroger Dedicated
Logistics Co., corporations described in and which executed the foregoing
instrument; that he knows the seals of said corporations; that the seals affixed
to said instrument are such corporate seals; that they were so affixed by
authority of the Boards of Directors of said corporations, and that he signed
his name thereto by like authority.
(Brenda R. Andes)
------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
STATE OF TEXAS )
) ss.:
COUNTY OF HARRIS )
On the 5th day of August, 1999, before me personally came
Steven McMillan, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Henpil, Inc. and Wydiv, Inc., the corporations
described in and which executed the foregoing instrument; that he knows the
seals of said corporations; that the seal affixed to said instrument are such
corporate seals; that they were so affixed by authority of the Boards of
Directors of said corporations, and that he signed his name thereto by like
authority.
(Barbara Edwards)
------------------------------
Notary Public
Barbara Edwards [Notarial Seal]
Notary Public, State of Texas
My Commission Expires October 19, 2001
<PAGE> 19
STATE OF TEXAS )
) ss.:
COUNTY OF EL PASO )
On the 30th day of July, 1999, before me personally came
Keith C. Larson, to me known, who, being by me duly sworn, did depose and say
that he is Vice President of Richie's, Inc., one of the corporations described
in and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
(Mercedes Flores)
--------------------------------------
Notary Public
Mercedes Flores [Notarial Seal]
Notary Public, State of Texas
My Commission Expires 10/23/99
STATE OF OHIO )
) ss.:
COUNTY OF HAMILTON )
On the 30th day of July, 1999, before me personally came
Bruce M. Gack, to me known, who, being by me duly sworn, did depose and say that
he is Vice President of Vine Court Assurance Incorporated, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
(Brenda R. Andes)
--------------------------------------
Notary Public
Brenda R. Andes [Notarial Seal]
Notary Public, State of Ohio
My Commission Expires June 20, 2003
<PAGE> 20
SCHEDULE I
Additional Guarantors
---------------------
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Inter-American Foods, Inc. Ohio
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Limited Partnership I Ohio (limited partnership)
By: KRGP Inc., the General Partner
Kroger Limited Partnership II Ohio (limited partnership)
By: KRGP Inc., the General Partner
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania (limited partnership)
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
<PAGE> 21
Name of Additional Guarantor State of Organization
- ---------------------------- ---------------------
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Compare, Inc. Delaware
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
<PAGE> 1
Exhibit 5.1
The Kroger Co.
1014 Vine Street
Cincinnati, OH 45202-1100
August 20, 1999
Board of Directors
The Kroger Co.
1014 Vine Street
Cincinnati, OH 45202
Ladies and Gentlemen:
I am familiar with the proceedings taken and proposed to be taken by The Kroger
Co., an Ohio corporation (the "Company"), in connection with the issuance of up
to $900,000,000 aggregate principal amount of debt securities (the "Securities")
in exchange for existing debt securities issued by the Company on June 25, 1999.
I have acted as counsel to the Company in connection with its preparation of a
Registration Statement relating to such issuance of the Securities on Form S-4
filed by the Company with the Securities and Exchange Commission (the
"Registration Statement") for the registration of the Securities under the
Securities Act of 1933, as amended (the "Act"). I have examined the Registration
Statement and the exhibits thereto; the Amended Articles of Incorporation and
Regulations of the Company; the corporate minutes of the proceedings of the
directors and shareholders of the Company; and such other records and documents
as I have deemed necessary in order to express the opinions hereinafter set
forth.
Based upon the foregoing, I am of the opinion that, when the indenture has been
duly executed and delivered, and the Securities have been duly executed,
authenticated, and issued in accordance with the terms of the instruments under
which they are being issued, the Securities will constitute the valid and
binding obligations of the Company.
The foregoing opinion is subject to applicable bankruptcy, insolvency, or other
laws affecting creditors' rights generally, as from time to time in effect, and
to general equity principles.
<PAGE> 2
Exhibit 5.1
I consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to me in the Registration Statement under the
caption "Legal Matters" therein. In giving such consent, I do not admit
that I am in the category of persons whose consent is required under Section 7
of the Act.
Very truly yours,
(Paul W. Heldman)
Paul W. Heldman
Senior Vice President, Secretary
and General Counsel
<PAGE> 1
Exhibit 21.1
SUBSIDIARIES OF THE KROGER CO.
Name State of Incorporation/Organization
---- -----------------------------------
Dillon Companies, Inc. Kansas
Drug Distributors, Inc. Indiana
Henpil, Inc. Texas
Inter-American Foods, Inc. Ohio
J. V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
The Kroger Co. of Michigan Michigan
Kroger Dedicated Logistics Co. Ohio
Kroger Limited Partnership I Ohio
Kroger Limited Partnership II Ohio
Peyton's-Southeastern, Inc. Tennessee
Rocket Newco, Inc. Texas
Topvalco, Inc. Ohio
Vine Court Assurance Incorporated Vermont
Wydiv, Inc. Texas
City Market, Inc. Colorado
Dillon Real Estate Co., Inc. Kansas
Fry's Leasing Company, Inc. Arizona
Jackson Ice Cream Co., Inc. Kansas
Junior Food Stores of West Florida, Inc. Florida
Kwik Shop, Inc. Kansas
Mini Mart, Inc. Wyoming
Quik Stop Markets, Inc. California
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Turkey Hill, L.P. Pennsylvania
Wells Aircraft, Inc. Kansas
Fred Meyer, Inc. Delaware
Fred Meyer Stores, Inc. Delaware
CB&S Advertising Agency, Inc. Oregon
Distribution Trucking Company Oregon
FM, Inc. Utah
FM Holding Corporation Delaware
Grand Central, Inc. Utah
FM Retail Services, Inc. Washington
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Jewelers, Inc. Delaware
Merksamer Jewelers, Inc. California
Roundup Co. Washington
JH Properties, Inc. Washington
Smith's Food & Drug Centers, Inc. Delaware
Compare, Inc. Delaware
Richie's, Inc. Texas
Saint Lawrence Holding Company Delaware
Smith's Beverage of Wyoming, Inc. Wyoming
<PAGE> 2
Smitty's Supermarkets, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Treasure Valley Land Company, L.C. Idaho
Western Property Investment
Group, Inc. California
Quality Food Centers, Inc. Washington
Hughes Markets, Inc. California
Hughes Realty, Inc. California
KU Acquisition Corporation Washington
Second Story, Inc. Washington
Quality Food, Inc. Delaware
Quality Food Holdings, Inc. Delaware
QFC Sub, Inc. Washington
Food 4 Less Holdings, Inc. Delaware
Ralphs Grocery Company Delaware
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
Crawford Stores, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less GM, Inc. California
Agri Products, Inc. Arkansas
Bluefield Beverage Co. Ohio
Fred Meyer HK Limited Hong Kong
Fred Meyer, Inc. Washington
Fry's Leasing Company, Inc. Arizona
Ft. Wayne Food Stores, Inc. Ohio
Healthy Options Inc. Delaware
Jero, Inc. Wyoming
Kroger Management Co. Michigan
MANUCO Incorporated Ohio
Natur Glo, Inc. Oregon
One Holdings, Inc. Delaware
Pontiac Foods, Inc. South Carolina
SLHC 2, Inc. Delaware
Southern Ice Cream Ohio
Specialties, Inc.
Ten Holdings, Inc. Delaware
Three Holdings, Inc. Delaware
Two Holdings, Inc. Delaware
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement of The Kroger Co. on Form S-4 of our report (which contains an
explanatory paragraph relating to the Company's change in its application of the
LIFO method of accounting for store inventories) dated January 28, 1999, on our
audits of the consolidated financial statements of The Kroger Co. as of January
2, 1999 and December 27, 1997, and for the years ended January 2, 1999, December
27, 1997, and December 28, 1996, which report is included in the Company's
Annual Report on Form 10-K for the fiscal year ended January 2, 1999, our report
dated April 30, 1999, on our audit of the financial statements of The Kroger Co.
as of and for the twenty-eight days ended January 30, 1999, which report is
included in the Company's Current Report on Form 8-K dated May 10, 1999, our
report (which contains an explanatory paragraph that describes a change in the
Company's application of the LIFO method of accounting for store inventories and
an explanatory paragraph that discloses that the supplemental financial
statements give retroactive effect to the merger of The Kroger Co. and Fred
Meyer, Inc. on May 27, 1999, which has been accounted for as a pooling of
interests), dated May 28, 1999 on our audit of the supplemental consolidated
financial statements of The Kroger Co. as of January 2, 1999 and December 27,
1997, and for the years ended January 2, 1999, December 27, 1997, and December
28, 1996, which report is included in the Company's Current Report on Form 8-K
dated May 28, 1999, and our report (which contains an explanatory paragraph
relating to the Company's change in its application of the LIFO method of
accounting for store inventories) dated January 28, 1999, except for the
Guarantor Subsidiaries note, as to which the date is August 13, 1999, on our
audits of the consolidated financial statements of The Kroger Co. as of January
2, 1999 and December 27, 1997, and for the years ended January 2, 1999, December
27, 1997, and December 28, 1996, which report is included in the Company's
Current Report on Form 8-K dated August 20, 1999. We also consent to the
references to our firm under the caption "Experts" in such Registration
Statement.
(PricewaterhouseCoopers LLP)
PricewaterhouseCoopers LLP
Cincinnati, Ohio
August 20, 1999
<PAGE> 1
Exhibit 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
The Kroger Co. on Form S-4 of our report dated March 10, 1999 on the
consolidated financial statements of Fred Meyer, Inc., appearing in the Annual
Report on Form 10-K of Fred Meyer, Inc. for the year ended January 30, 1999, and
to the use of our report dated March 10, 1999, appearing in the Current Report
on Form 8-K dated May 28, 1999 of The Kroger Co., and to the reference to us
under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Portland, Oregon
August 20, 1999
<PAGE> 1
Exhibit 24.1
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, That the undersigned directors of THE
KROGER CO. (the "Company") hereby make, constitute and appoint Paul W. Heldman
and Bruce M. Gack, or either one of them, his or her true and lawful
attorneys-in-fact to sign and execute for and on his or her behalf, a
registration statement and any and all amendments thereto with respect to the
issuance and sale by the Company of up to $900,000,000 of Securities to be
filed with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended, in such form as they, or either of them, may approve
and to do any and all other acts which said attorneys-in-fact, or either one of
them, may deem necessary or desirable to enable The Kroger Co. to comply
with said Act and the rules and regulations thereunder in connection with such
sale.
IN WITNESS WHEREOF, the undersigned directors have hereunto set their hands and
seal, as of the 22nd day of July, 1999.
s/s Clyde R. Moore s/s Ronald W. Burkle
- ------------------------- --------------------------------
s/s Martha R. Seger s/s T. Ballard Morton, Jr.
- ------------------------- --------------------------------
s/s John T. LaMacchia s/s Thomas H. O'Leary
- ------------------------- --------------------------------
s/s Bobby S. Shackouls s/s Katherine D. Ortega
- ------------------------- --------------------------------
s/s Edward M. Liddy s/s Bruce Karatz
- ------------------------- --------------------------------
s/s James D. Woods s/s Reuben V. Anderson
- ------------------------- --------------------------------
s/s Robert D. Beyer s/s John L. Clendenin
- ------------------------- --------------------------------
s/s David B. Dillon s/s Carlton J. Jenkins
- ------------------------- --------------------------------
s/s Joseph A. Pichler
- -------------------------
s/s Robert G. Miller
- -------------------------
<PAGE> 2
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, That the undersigned officer of THE KROGER
CO. (the "Company") hereby makes, constitutes and appoints Paul W. Heldman and
Bruce M. Gack, or either one of them, his true and lawful attorneys-in-fact to
sign and execute for and on his behalf, a registration statement and any and all
amendments thereto with respect to the issuance and sale by the Company of up to
$900,000,000 of Securities to be filed with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended, in such form as
they, or either of them, may approve and to do any and all other acts which said
attorneys-in-fact, or either one of them, may deem necessary or desirable to
enable The Kroger Co. to comply with said Act and the rules and regulations
thereunder in connection with such sale.
IN WITNESS WHEREOF, I have hereunto set my hand.
s/s W. Rodney McMullen July 22, 1999
- -----------------------------
W. Rodney McMullen
Executive Vice President and
Chief Financial Officer
<PAGE> 3
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, That the undersigned officer and director of
THE KROGER CO. (the "Company") hereby makes, constitutes and appoints Paul W.
Heldman and Bruce M. Gack, or either one of them, his true and lawful
attorneys-in-fact to sign and execute for and on his behalf, a registration
statement and any and all amendments thereto with respect to the issuance and
sale by the Company of up to $900,000,000 of Securities to be filed with the
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended, in such form as they, or either of them, may approve and to do any and
all other acts which said attorneys-in-fact, or either one of them, may deem
necessary or desirable to enable The Kroger Co. to comply with said Act and the
rules and regulations thereunder in connection with such sale.
IN WITNESS WHEREOF, I have hereunto set my hand.
s/s Joseph A. Pichler July 22, 1999
- ----------------------------
Joseph A. Pichler
Chairman of the Board,
Chief Executive Officer and
Director
<PAGE> 4
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, That the undersigned officer of THE KROGER
CO. (the "Company") hereby makes, constitutes and appoints Paul W. Heldman and
Bruce M. Gack, or either one of them, his true and lawful attorneys-in-fact to
sign and execute for and on his behalf, a registration statement and any and all
amendments thereto with respect to the issuance and sale by the Company of up to
$900,000,000 of Securities to be filed with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended, in such form as
they, or either of them, may approve and to do any and all other acts which said
attorneys-in-fact, or either one of them, may deem necessary or desirable to
enable The Kroger Co. to comply with said Act and the rules and regulations
thereunder in connection with such sale.
IN WITNESS WHEREOF, I have hereunto set my hand.
s/s J. Michael Schlotman July 22, 1999
- -----------------------------------
J. Michael Schlotman
Vice President and Corporate Controller
<PAGE> 5
RESOLUTION
WHEREAS, On June 25, 1999, the Company issued $250,000,000 of its 6.34% Senior
Notes due 2001, $350,000,000 of its 7.25% Senior Notes due 2009, and
$300,000,000 of its 7.70% Senior Notes due 2029 (collectively, the "Notes"); and
WHEREAS, The Notes were issued under Rule 144A of the Securities Act of 1933,
and the Company agreed to give the holders of the Notes certain registration
rights; now, therefore
RESOLVED, That the Company is authorized to issue, in exchange for the Notes,
registered securities (the "Securities") with terms substantially identical to
the Notes; and further
RESOLVED, The Securities may be issued by the Company and the determination of
all terms and conditions of the Securities is delegated to a Management
Committee made up of Joseph A. Pichler, David B. Dillon, W. Rodney McMullen, and
Lawrence M. Turner, any three of whom can act for the Management Committee; and
further
RESOLVED, That the Management Committee may designate one or more persons, who
may or may not be a member of the Committee, to act as and for the Committee in
any capacity as the Committee may direct; and further
RESOLVED, That the Management Committee may authorize the issuance of the
Securities by the Company in exchange for the Notes and, in connection with any
such authorization, issue, determine, approve, or appoint, as the case may be:
(a) the type of Security or Securities and title or titles thereof;
(b) the aggregate principal amount, not to exceed $900,000,000, the
denominations, and terms, of the Securities;
(c) the price at which the Securities are to be sold (which may be issued at an
"original issue discount" within the meaning of the Internal Revenue Code
of 1986, as amended), and the interest rate or rates, if any, to be
established for the Securities, which rate or rates may vary from time to
time;
(d) the issuance of the Securities in any foreign currency or European currency
units and if European currency units are issued, the currency or
<PAGE> 6
currencies in which interest is payable;
(e) the maturity or maturities;
(f) the sinking fund, if any, and related redemption prices of the Securities;
(g) the optional redemption rights, if any, of the Company and of the holders
of the Securities, and related redemption prices and any limitations on
such redemption;
(h) the restrictive covenants, if any, to be imposed upon the Company relating
to any of the Securities;
(i) the form of Registration Statement on Form S-4, or such other form as the
Management Committee determines (the "Registration Statement"), for the
purpose of registering the Securities, if so required, under the Securities
Act of 1933, as amended, and any amendments thereto;
(j) any underwriting, standby, or similar agreement between the Company and an
underwriter or underwriters;
(k) the use, form, execution, and delivery of the Securities, indentures, note
agreement, loan agreement, distribution agreement, reimbursement agreement,
warrant agreement, notes, or any other contracts or agreements, including
listing applications, as the Management Committee deems necessary or
appropriate;
(l) any transfer, authenticating, placement, exchange, distribution, or paying
agent, or registrar, trustee or underwriter, or any other person or entity
to act in connection with the Securities or the Notes; including the
selection of a financial institution or institutions, whether foreign or
domestic, to advise the Company;
(m) any other terms, conditions, and provisions as the Management Committee
deems necessary or appropriate; and further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized, in the name and on behalf of the Company, to execute the
Registration Statement with such changes therein as the officer executing the
same may approve, such execution to be conclusive evidence of such approval, and
to execute any and all amendments thereto as deemed necessary or desirable; and
further
RESOLVED, That upon the execution of the Registration Statement or any
amendments thereto, including post-effective amendments, by directors and
<PAGE> 7
officers of the Company, as required by law, either in person or by a duly
authorized attorney or attorneys, the elected officers of the Company be, and
each of them hereby is, authorized to cause the Registration Statement and any
amendments thereto to be filed with the Securities and Exchange Commission (the
"Commission") and to execute and file all such instruments, make all such
payments, and to do such other acts and things as, in their opinion or in the
opinion of any of them, may be necessary or desirable in order to effect such
filing, to cause the Registration Statement to become effective, and to maintain
the Registration Statement in effect for as long as they deem it to be in the
best interests of the Company; and further
RESOLVED, That Paul W. Heldman and Bruce M. Gack, or either one of them, be, and
each of them hereby is, made, constituted, and appointed the true and lawful
attorneys-in-fact, with authority to sign and execute on behalf of this Company,
and on behalf of the directors and officers thereof in their official
capacities, the Registration Statement and any and all amendments thereto, which
either of them, in their discretion, deem necessary or advisable to be filed
with the Commission; and further
RESOLVED, That Paul W. Heldman, Senior Vice President, Secretary and General
Counsel of the Company, whose address is 1014 Vine Street, Cincinnati, Ohio, be,
and he hereby is, designated as the Agent for Service to be named in the
Registration Statement, with authority to receive notices and communications
with respect to such Registration Statement and with all powers consequent upon
such designation under the rules and regulations of the Commission; and further
RESOLVED, That, subject to the limitations set forth in these resolutions, the
Management Committee may approve the form of the Securities; that the elected
officers of the Company be, and each of them hereby is, authorized to execute,
in the name and on behalf of the Company, the Securities; that the signature of
each of such officers on the Securities may be manual or by facsimile; that
Securities bearing the manual or facsimile signatures of individuals who were at
any time the elected officers of the Company will bind the Company
notwithstanding that such individuals or any of them cease to hold such offices;
that the elected officers of the Company be, and each of them hereby is,
authorized to deliver or cause to be delivered the Securities for authentication
and delivery in the principal amount thereof as shall have been determined by
the Board or a Committee; and further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized and directed, if such officer or officers deems it necessary in
connection with the offering of any of the Securities, to appoint a withholding
agent and attorney for the Company for the purpose of withholding any and all
<PAGE> 8
taxes required to be withheld by the Company, under any Federal or other laws or
regulations from time to time in effect, from the interest paid from time to
time on the Securities, and to authorize and direct such agent to make any and
all payments and reports and to file any and all returns and accompanying
certificates with any governmental authority which such agent may be permitted
or required to make or file as such agent under such laws or regulations; and
further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized in the name and on behalf of this Company to take any and all
action which they deem necessary or advisable to effect the registration or
qualification (or exemptions therefrom) of the Securities for issue, offer,
sale, or trade under the Blue Sky or securities laws of any State of the United
States of America, any Province of Canada, or of any other country and in
connection therewith to sign, execute, acknowledge, verify, deliver, file, and
publish all such applications, issuer's covenants, consents to service of
process, resolutions, and other papers and documents as may be required under
such laws, and to take any and all further action which they deem necessary or
advisable in order to maintain such registration or qualification of the
Securities for as long as they may deem necessary or as required by law; and
further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized in the name and on behalf of this Company to execute and file an
application or applications for the listing of the Securities on the New York
Stock Exchange, to appear before officials of the New York Stock Exchange and to
take any and all action, and prepare, execute, and file any and all other
applications and agreements, including an indemnity agreement relating to the
use of facsimile signatures in the execution of the Securities, necessary,
incidental, or convenient to effectuate such listing; and further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized in the name and on behalf of this Company to execute and cause to
be filed with the Commission and the New York Stock Exchange an application on
Form 8-A, or such other form as may be required for the purpose of registering
the Securities on a national securities exchange, pursuant to the Securities
Exchange Act of 1934; and further
RESOLVED, That the elected officers of the Company be, and each of them hereby
is, authorized and directed to advise the Company's senior lenders and the
trustees under the indentures of its publicly issued debt of the issuance of
Securities, as any such officer deems necessary or appropriate; and further
RESOLVED, That the Management Committee and each of the elected officers of the
Company be, and each of them hereby is, authorized and directed to do
<PAGE> 9
and perform, or cause to be done and performed, all such acts, deeds, and things
and to make, execute, and deliver, or cause to be made, executed, and delivered,
all such agreements, undertakings, documents, instruments, or certificates, in
the name and on behalf of the Company or otherwise, including, without
limitation, indentures, loan agreements, underwriting, placement, exchange or
agency agreements, and trust agreements, all as the applicable Committee or any
of the elected officers deem necessary or appropriate to effect the purposes and
intent of the foregoing resolutions.
<PAGE> 1
Exhibit 99.1
THE KROGER CO.
LETTER OF TRANSMITTAL
FOR ITS OFFER TO EXCHANGE ITS SERIES B 6.34% SENIOR
NOTES DUE 2001, SERIES B 7.25% SENIOR NOTES DUE 2009 AND/OR
SERIES B 7.70% SENIOR NOTES DUE 2029,
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT,
FOR ITS CORRESPONDING SERIES A 6.34% SENIOR NOTES DUE 2001,
SERIES A 7.25% SENIOR NOTES DUE 2009 AND/OR
SERIES A 7.70% SENIOR NOTES DUE 2029,
WHICH HAVE NOT BEEN SO REGISTERED.
PURSUANT TO THE PROSPECTUS DATED ________, 1999
- --------------------------------------------------------------------------------
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME, ON ______, 1999
UNLESS EXTENDED (THE "EXPIRATION DATE"). TENDERS MAY BE WITHDRAWN PRIOR TO
5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
- --------------------------------------------------------------------------------
FIRSTAR BANK, NATIONAL ASSOCIATION, EXCHANGE AGENT
BY REGISTERED OR CERTIFIED MAIL OR BY HAND OR OVERNIGHT COURIER:
FIRSTAR BANK, N.A.
425 WALNUT STREET
6TH FLOOR
CINCINNATI, OHIO 45202
CONFIRM BY TELEPHONE: 513-632-4278
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE, OR TRANSMISSION OF INSTRUCTIONS OTHER THAN
AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
The undersigned acknowledges that he or she has received and reviewed
the Prospectus, dated _______, 1999 (the "Prospectus"), of The Kroger Co. (the
"Company") and this Letter of Transmittal (the "Letter"), which together
constitute the Company's offer (the "Exchange Offer") to exchange up to
$250,000,000 aggregate principal amount of the Company's Series B 6.34% Senior
Notes Due 2001, $350,000,000 aggregate principal amount of the Company's Series
B 7.25% Senior Notes due 2009 and $300,000,000 aggregate principal amount of the
Company's Series B 7.70% Senior Notes due 2029 (the "New Notes"), which have
been registered under the Securities Act of 1933 (the "Securities Act"), for a
like corresponding principal amount of the Company's issued and outstanding
Series A 6.34% Senior Notes Due 2001, Series A 7.25% Senior Notes due 2009 and
Series A 7.70% Senior Notes due 2029 (the "Old Notes"), which have not been so
registered.
For each Old Note accepted for exchange, the registered holder of such
Old Note (collectively with all other registered holders of Old Notes, the
"Holders") will receive a New Note having a principal amount equal to that of
the surrendered Old Note. Registered holders of New Notes on the relevant record
date for the first interest payment date following the consummation of the
Exchange Offer will receive interest accruing from the most recent date to which
interest has been paid or, if no interest has been paid, from June 25, 1999. Old
Notes accepted for exchange will cease to accrue interest from and after the
date of consummation of the Exchange Offer. Accordingly, Holders whose Old Notes
are accepted for exchange will not receive any payment in respect of accrued
interest on such Old Notes otherwise payable on any interest payment date the
record date for which occurs on or after consummation of the Exchange Offer.
This Letter is to be completed by a Holder of Old Notes either if
certificates are to be forwarded herewith or if a tender of certificates for Old
Notes, if available, is to be made by book-entry transfer to the account
maintained by the Exchange Agent at The Depository Trust Company (the
"Book-Entry Transfer Facility") pursuant to the procedures set forth in "The
Exchange Offer - Procedures for Tendering" section of the Prospectus. Holders of
Old Notes whose certificates are not immediately available, or who are unable to
deliver their certificates or confirmation of the book-entry tender of their Old
Notes into the Exchange Agent's account at the Book-Entry Transfer Facility (a
"Book-Entry Confirmation") and all other documents required by this Letter to
the Exchange Agent on or prior to the Expiration Date, must tender their Old
Notes according to the guaranteed delivery procedures set forth in "The Exchange
Offer - Guaranteed Delivery Procedures" section of the Prospectus. See
Instruction 1. Delivery of documents to the Book-Entry Transfer Facility does
not constitute delivery to the Exchange Agent.
THE UNDERSIGNED HAS COMPLETED THE APPROPRIATE BOXES BELOW AND SIGNED THIS
LETTER TO INDICATE THE ACTION THE UNDERSIGNED DESIRES TO TAKE WITH RESPECT
TO THE EXCHANGE OFFER.
<PAGE> 2
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the aggregate principal amount of Old
Notes indicated below. Subject to, and effective upon, the acceptance for
exchange of the Old Notes tendered hereby, the undersigned hereby sells, assigns
and transfers to, or upon the order of the Company all right, title and interest
in and to such Old Notes as are being tendered hereby.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Old Notes
tendered hereby and that the Company will acquire good and unencumbered title
thereto, free and clear of all liens, restrictions, charges and encumbrances and
not subject to any adverse claim when the same are accepted by the Company. The
undersigned hereby further represents that any New Notes acquired in exchange
for Old Notes tendered hereby will have been acquired in the ordinary course of
business of the person receiving such New Notes, whether or not such person is
the undersigned, that neither the Holder of such Old Notes nor any such other
person has an arrangement or understanding with any person to participate in the
distribution of such New Notes and that neither the Holder of such Old Notes nor
any such other person is an "affiliate" (as defined in Rule 405 under the
Securities Act) of the Company.
The undersigned also acknowledges that this Exchange Offer is being
made in reliance on interpretations by the staff of the Securities and Exchange
Commission (the "SEC"), as set forth in no-action letters issued to third
parties, that the New Notes issued pursuant to the Exchange Offer in exchange
for the Old Notes may be offered for resale, resold and otherwise transferred by
a Holder thereof (other than a Holder that is an "affiliate" of the Company
within the meaning of Rule 405 under the Securities Act) without compliance with
the registration and prospectus delivery provisions of the Securities Act,
provided that such New Notes are acquired in the ordinary course of such
Holder's business and such Holder has no arrangement with any person to
participate in a distribution of such New Notes. However, the SEC has not
considered the Exchange Offer in the context of a no-action letter and there can
be no assurance that the staff of the SEC would make a similar determination
with respect to the Exchange Offer as in other circumstances. If the undersigned
is not a broker-dealer, the undersigned represents that it is not engaged in,
and does not intend to engage in, a distribution of New Notes and has no
arrangement or understanding to participate in a distribution of New Notes. If
any Holder is an affiliate of the Company, is engaged in or intends to engage
in, or has any arrangement or understanding with any person to participate in, a
distribution of the New Notes to be acquired pursuant to the Exchange Offer,
such Holder could not rely on the applicable interpretations of the staff of the
SEC and must comply with the registration and prospectus delivery requirements
of the Securities Act in connection with any resale transaction. If the
undersigned is a broker-dealer that will receive New Notes for its own account
in exchange for Old Notes that were acquired as a result of market-making
activities or other trading activities, it acknowledges that it will deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such New Notes. However, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
The undersigned will, upon request, execute and deliver any additional
documents deemed by the Company to be necessary or desirable to complete the
sale, assignment and transfer of the Old Notes tendered hereby. All authority
conferred or agreed to be conferred in this Letter and every obligation of the
undersigned hereunder shall be binding upon the successors, assigns, heirs,
executors, administrators, trustees in bankruptcy and legal representatives of
the undersigned and shall not be affected by, and shall survive, the death or
incapacity of the undersigned. This tender may be withdrawn only in accordance
with the procedures set forth in "The Exchange Offer - Withdrawal Rights"
section of the Prospectus.
Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" herein, please issue the New Notes (and, if applicable, substitute
certificates representing Old Notes for any Old Notes not exchanged) in the name
of the undersigned or, in the case of a book-entry delivery of Old Notes, please
credit the account indicated above maintained at the Book-Entry Transfer
Facility. Similarly, unless otherwise indicated under the box entitled "Special
Delivery Instructions" herein, please send the New Notes (and, if applicable,
substitute certificates representing Old Notes for any Old Notes not exchanged)
to the undersigned at the address shown in the boxes herein entitled
"Description of Old Notes Delivered."
<PAGE> 3
THE UNDERSIGNED, BY COMPLETING THE BOX BELOW ENTITLED "DESCRIPTION OF
OLD NOTES DELIVERED" AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED
OLD NOTES AS SET FORTH IN SUCH BOX
List below the Old Notes to which this Letter relates. If the space provided
below is inadequate, the certificate numbers and principal amount of Old Notes
should be listed on a separate signed schedule affixed hereto.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD NOTES DELIVERED
- ---------------------------------------------------------------------------------------------------------------------
SERIES A 6.34% SENIOR NOTES DUE 2001
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NAME(S) AND ADDRESS OF REGISTERED HOLDER AGGREGATE PRINCIPAL PRINCIPAL AMOUNT
(PLEASE FILL IN, IF BLANK) CERTIFICATE NUMBER(S)* AMOUNT TENDERED**
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
Totals:
- -------------------------------------------- --------------------------- --------------------- ----------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD NOTES DELIVERED
- ---------------------------------------------------------------------------------------------------------------------
SERIES A 7.25% SENIOR NOTES DUE 2009
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NAME(S) AND ADDRESS OF REGISTERED HOLDER AGGREGATE PRINCIPAL PRINCIPAL AMOUNT
(PLEASE FILL IN, IF BLANK) CERTIFICATE NUMBER(S)* AMOUNT TENDERED**
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
Totals:
- -------------------------------------------- --------------------------- --------------------- ----------------------
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD NOTES DELIVERED
- ---------------------------------------------------------------------------------------------------------------------
SERIES A 7.70% SENIOR NOTES DUE 2029
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NAME(S) AND ADDRESS OF REGISTERED HOLDER AGGREGATE PRINCIPAL PRINCIPAL AMOUNT
(PLEASE FILL IN, IF BLANK) CERTIFICATE NUMBER(S)* AMOUNT TENDERED**
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
- -------------------------------------------- --------------------------- --------------------- ----------------------
Totals:
- -------------------------------------------- --------------------------- --------------------- ----------------------
</TABLE>
* Need not be completed if Old Notes are being tendered by book-entry
transfer.
** Unless otherwise indicated in this column, a holder will be deemed to
have tendered ALL of the Old Notes represented by the listed
certificates. See Instruction 2. Old Notes tendered hereby must be in
denominations of principal amount of $1,000 and any integral multiple
thereof. See Instruction 1.
[ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT
TO A NOTICE OF GUARANTEED DELIVERY
PREVIOUSLY SENT TO THE EXCHANGE AGENT
AND COMPLETE THE FOLLOWING:
Name of Tendering Institution__________________________________________
Account Number ____________________ Transaction Code Number____________
[ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND
COMPLETE THE FOLLOWING:
Name of Registered Holder______________________________________________
Window Ticket Number (if any)__________________________________________
Date of Execution of Notice of Guaranteed Delivery_____________________
Name of Institution Which Guaranteed Delivery__________________________
If Delivered by Book-Entry Transfer, Complete the Following:
Account Number ____________________ Transaction Code Number____________
<PAGE> 5
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE ADDITIONAL
COPIES OF THE PROSPECTUS AND ANY AMENDMENTS OR SUPPLEMENTS THERETO.
(UNLESS OTHERWISE SPECIFIED, 10 ADDITIONAL COPIES WILL BE FURNISHED.)
NAME___________________________________________________________________
ADDRESS________________________________________________________________
<TABLE>
<CAPTION>
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
SPECIAL ISSUANCE INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 3 AND 4) (SEE INSTRUCTIONS 3 AND 4)
To be completed ONLY if certificates for Old To be completed ONLY if OLD Notes not
Notes not exchanged and/or New Notes are to be exchanged and/or New Notes are to be sent to someone other
issued in the name of someone other than the person other than the person or persons whose signature(s)
or persons whose signature(s) appear(s) on this Letter appear(s) on this Letter below or to such person or persons
below or to such below, or if Old Notes delivered by at an address other than shown in the box entitled
book-entry transfer which are not accepted for "Description of Old Notes delivered" on this Letter above.
exchange are to be returned by credit to an account
maintained at the Book-Entry Transfer Facility other Mail New Notes and/or Old Notes to:
than the account indicated above. Issue New Notes
and/or Old Notes to:
Name:______________________________________________ Name:______________________________________________
(Please Type or Print) (Please Type or Print)
Address:___________________________________________ Address:___________________________________________
___________________________________________________ ___________________________________________________
(Zip Code) (Zip Code)
[ ] Credit unexchanged Old Notes delivered by
book-entry transfer to the Book-Entry Transfer
Facility account set forth below.
___________________________________________________
(Book-Entry Transfer Facility Account)
- -------------------------------------------------------- --------------------------------------------------------
</TABLE>
<PAGE> 6
IMPORTANT: THIS LETTER OR A FACSIMILE HEREOF OR AN AGENCY'S MESSAGE IN
LIEU HEREOF (TOGETHER WITH THE CERTIFICATES FOR OLD NOTES OR A BOOK-
ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS OR THE NOTICE OF
GUARANTEED DELIVERY) MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO 5:00
P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
PLEASE READ THIS LETTER OF TRANSMITTAL CAREFULLY
BEFORE COMPLETING ANY BOX ABOVE
PLEASE SIGN HERE
(ALL TENDERING HOLDERS MUST COMPLETE THIS LETTER
AND THE ACCOMPANYING SUBSTITUTE FORM W-9)
Dated:_____________________, 1999
X_______________________________________________________________________________
X_______________________________________________________________________________
Signature(s)
Area Code and Telephone Number:_________________________________________________
If a holder is tendering any Old Notes, this letter must be signed by the
Holder(s) as the name(s) appear(s) on the certificate(s) for the Old Notes
or by any person(s) authorized to become Holder(s) by endorsements and
documents transmitted herewith. If signature is by a trustee, executor,
administrator, guardian, officer or other person acting in a fiduciary or
representative capacity, please set forth full title. See Instruction 3.
Name:___________________________________________________________________________
________________________________________________________________________________
(Please Type or Print)
Capacity (full title):__________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
Telephone:______________________________________________________________________
SIGNATURE GUARANTEE (IF REQUIRED BY INSTRUCTION 3)
Signature(s) Guaranteed by an Eligible Institution:_____________________________
(Authorized Signature)
________________________________________________________________________________
(Title)
________________________________________________________________________________
(Name and Firm)
Dated:_____________________________________________________________________,1999
<PAGE> 7
IMPORTANT TAX INFORMATION
Under current federal income tax law, a holder of New Notes is required
to provide the Company (as payor) with such holder's correct taxpayer
identification number ("TIN") on Substitute Form W-9 or otherwise establish a
basis for exemption from backup withholding to prevent backup withholding on any
New Notes delivered pursuant to the Exchange Offer and any payments received in
respect of the New Notes. If a holder of New Notes is an individual, the TIN is
such holder's social security number. If the Company is not provided with the
correct taxpayer identification number, a holder of New Notes may be subject to
a $50 penalty imposed by the Internal Revenue Service. Accordingly, each
prospective holder of New Notes to be issued pursuant to Special Issuance
Instructions should complete the attached Substitute Form W-9. The Substitute
Form W-9 need not be completed if the box entitled Special Issuance Instructions
has not been completed.
Certain holders of New Notes (including among others, all corporations
and certain foreign individuals) are not subject to these backup withholding and
reporting requirements. Exempt prospective holders of New Notes should indicate
their exempt status on Substitute Form W-9. A foreign individual may qualify as
an exempt recipient by submitting to the Company, through the Exchange Agent, a
properly completed Internal Revenue Service form W-8 (which the Exchange Agent
will provide upon request) signed under penalty of perjury, attesting to the
holder's exempt status. See the enclosed Guidelines for Certification of
Taxpayer Identification Number or Substitute Form W-9 for additional
instructions.
If backup withholding applies, the Company is required to withhold 31%
of any payment made to the holder of New Notes or other payee. Backup
withholding is not an additional federal income tax. Rather, the federal income
tax liability of persons subject to backup withholding will be reduced by the
amount of tax withheld. If withholding results in an overpayment of taxes, a
refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on any New Notes delivered pursuant to
the Exchange Offer and any payments received in respect of the New Notes, each
prospective holder of New Notes to be issued pursuant to Special Issuance
Instructions should provide the Company, through the Exchange Agent, with
either: (i) such prospective holder's correct TIN by completing the form below,
certifying that the TIN provided on Substitute Form W-9 is correct (or that such
prospective holder is awaiting a TIN) and that (A) such prospective holder has
not been notified by the Internal Revenue Service that he or she is subject to
backup withholding as a result of a failure to report all interest or dividends
or (B) the Internal Revenue Service has notified such prospective holder that he
or she is no longer subject to backup withholding; or (ii) an adequate basis for
exemption.
WHAT NUMBER TO GIVE THE EXCHANGE AGENT
The prospective holder of New Notes to be issued pursuant to Special
Issuance Instructions is required to give the Exchange Agent the TIN (e.g.,
social security number or employer identification number) of the prospective
record owner of the New Notes. If the New Notes will be held in more than one
name or are not held in the name of the actual owner, consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 for additional guidance regarding which number to report.
<PAGE> 8
TO BE COMPLETED BY ALL TENDERING HOLDERS
(SEE IMPORTANT TAX INFORMATION)
PAYOR'S NAME: FIRSTAR BANK, NATIONAL ASSOCIATION
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PART 1 - PLEASE PROVIDE YOUR TIN IN THE
BOX AT RIGHT OR INDICATE THAT TIN:______________________________
YOU APPLIED FOR A TIN AND CERTIFY BY Social Security Number or Employer
SIGNING AND DATING BELOW. Identification Number (or circle below)
TIN Applied for
-------------------------------------------------------------------------------------
SUBSTITUTE PART 2 - CERTIFICATION - UNDER PENALTIES OF PERJURY, I CERTIFY THAT:
FORM W-9 (1) The number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me);
Department of the Treasury (2) I am not subject to backup withholding either because: (a) I am exempt from
Internal Revenue Service backup withholding, or (b) I have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup withholding as a result of a
PAYOR'S REQUEST FOR TAXPAYER failure to report all interest or dividends, or (c) the IRS has notified me that I
IDENTIFICATION NUMBER ("TIN") am no longer subject to backup withholding; and
AND CERTIFICATION (3) any other information provided on this form is true and correct.
Signature:___________________________________ Date:______________________
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
You must cross out item (2) of the above certification if you have been
notified by the IRS that you are subject to backup withholding because of
underreporting of interest or dividends on your tax return and you have not been
notified by the IRS that you are no longer subject to backup withholding.
NOTE: FAILURE BY A PROSPECTIVE HOLDER OF EXCHANGE NOTES TO BE ISSUED
PURSUANT TO THE SPECIAL ISSUANCE INSTRUCTIONS ABOVE TO COMPLETE AND
RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF THE
EXCHANGE NOTES DELIVERED TO YOU PURSUANT TO THE EXCHANGE OFFER AND
ANY PAYMENTS RECEIVED BY YOU IN RESPECT OF THE EXCHANGE NOTES. PLEASE
REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED
THE BOX IN PART 2 OF SUSTITUTE FORM W-9
- --------------------------------------------------------------------------------
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification
number has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or a Social Security Administration Office or
(b) I intend to mail or deliver an application in the near future. I understand
that if I do not provide a taxpayer identification number by the time of the
exchange, 31 percent of all reportable payments made to me thereafter will be
withheld until I provide a number.
___________________________________________ ________________________________
Signature Date
- --------------------------------------------------------------------------------
<PAGE> 9
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER TO EXCHANGE
THE SERIES B 6.34% SENIOR NOTES DUE 2001, SERIES B 7.25% SENIOR NOTES DUE 2009
AND SERIES B 7.70% SENIOR NOTES DUE 2029 OF THE KROGER CO.
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT,
FOR THE CORRESPONDING OUTSTANDING SERIES A 6.34% SENIOR NOTES DUE 2001,
SERIES A 7.25% SENIOR NOTES DUE 2009 AND SERIES A 7.70% SENIOR NOTES DUE 2029
WHICH HAVE NOT BEEN SO REGISTERED.
1. DELIVERY OF THIS LETTER AND NOTES; GUARANTEED DELIVERY PROCEDURES.
This Letter is to be completed by Holders of Old Notes either if
certificates are to be forwarded herewith or if tenders are to be made pursuant
to the procedures for delivery by book-entry transfer set forth in "The Exchange
Offer - Procedures for Tendering" section of the Prospectus. Certificates for
all physically tendered Old Notes, or Book-Entry Confirmation, as the case may
be, as well as a properly completed and duly executed Letter (or manually signed
facsimile hereof) and any other documents required by this Letter, must be
received by the Exchange Agent at the address set forth herein on or prior to
the Expiration Date, or the tendering holder must comply with the guaranteed
delivery procedures set forth below. Old Notes tendered hereby must be in
denominations of principal amount of $1,000 and any integral multiple thereof.
Holders whose certificates for Old Notes are not immediately available
or who cannot deliver their certificates and all other required documents to the
Exchange Agent on or prior to the Expiration Date, or who cannot complete the
procedure for book-entry transfer on a timely basis, may tender their Old Notes
pursuant to the guaranteed delivery procedures set forth in "The Exchange Offer
- - Guaranteed Delivery Procedures" section of the Prospectus. Pursuant to such
procedures, (i) such tender must be made through an Eligible Institution (as
defined below), (ii) on or prior to 5:00 p.m., New York City time, on the
Expiration Date, the Exchange Agent must receive from such Eligible Institution
a properly completed and duly executed Letter (or a facsimile thereof) and
Notice of Guaranteed Delivery, substantially in the form provided by the Company
(by telegram, telex, facsimile transmission, mail or hand delivery), setting
forth the name and address of the holder of Old Notes and the amount of Old
Notes tendered, stating that the tender is being made thereby and guaranteeing
that within three New York Stock Exchange ("NYSE") trading days after the date
of execution of the Notice of Guaranteed Delivery, the certificates for all
physically tendered Old Notes, in proper form for transfer, or a Book-Entry
Confirmation, as the case may be, and any other documents required by this
Letter will be deposited by the Eligible Institution with the Exchange Agent,
and (iii) the certificates for all physically tendered Old Notes, in proper form
for transfer, or Book-Entry Confirmation, as the case may be, and any other
documents required by this Letter, are deposited by the Eligible Institution
within three NYSE trading days after the date of execution of the Notice of
Guaranteed Delivery.
The method of delivery of this Letter, the Old Notes and all other
required documents is at the election and risk of the tendering Holders, but the
delivery will be deemed made only when actually received or confirmed by the
Exchange Agent. If Old Notes are sent by mail, it is suggested that the mailing
be registered mail, properly insured, with return receipt requested, and made
sufficiently in advance of the Expiration Date to permit delivery to the
Exchange Agent prior to 5:00 p.m., New York City time, on the Expiration Date.
See "The Exchange Offer" section of the Prospectus.
2. PARTIAL TENDERS (NOT APPLICABLE TO NOTEHOLDERS WHO TENDER BY BOOK-
ENTRY TRANSFER).
If less than all of the Old Notes evidenced by a submitted certificate
are to be tendered, the tendering holder(s) should fill in the aggregate
principal amount of Old Notes to be tendered in the boxes above entitled
"Description of Old Notes Delivered - Principal Amount Tendered." A reissued
certificate representing the balance of nontendered Old Notes will be sent to
such tendering Holder, unless otherwise provided in the appropriate box of this
Letter, promptly after the Expiration Date. All of the Old Notes delivered to
the Exchange Agent will be deemed to have been tendered unless otherwise
indicated.
<PAGE> 10
3. SIGNATURES ON THIS LETTER, BOND POWERS AND ENDORSEMENTS, GUARANTEE OF
SIGNATURES.
If this Letter is signed by the Holder of the Old Notes tendered
hereby, the signature must correspond exactly with the name as written on the
face of the certificates without any change whatsoever.
If any tendered Old Notes are owned of record by two or more joint
owners, all of such owners must sign this Letter.
If any tendered Old Notes are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
copies of this letter as there are different registrations of certificates.
When this letter is signed by the Holder or Holders of the Old Notes
specified herein and tendered hereby, no endorsements of certificates or
separate bond powers are required. If however, the New Notes are to be issued,
or any untendered Old Notes are to be reissued, to a person other than the
Holder, then endorsements of any certificates transmitted hereby or separate
bond powers are required. Signatures on such certificate(s) must be guaranteed
by an Eligible Institution.
If this letter is signed by a person other than the Holder or Holders
of any certificate(s) specified herein, such certificate(s) must be endorsed
accompanied by appropriate bond powers, in either case signed exactly as the
name or names of the Holder or Holders appear(s) on the certificate(s) and
signatures on such certificate(s) must be guaranteed by an Eligible Institution.
If this Letter or any certificates or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and, unless waived by the Company,
proper evidence satisfactory to the Company of their authority to so act must be
submitted.
ENDORSEMENTS ON CERTIFICATES FOR OLD NOTES OR SIGNATURES ON BOND POWERS
REQUIRED BY THIS INSTRUCTION 3 MUST BE GUARANTEED BY A FINANCIAL INSTITUTION
(INCLUDING MOST BANKS, SAVINGS AND LOAN ASSOCIATIONS AND BROKERAGE HOUSES) THAT
IS A PARTICIPANT IN THE SECURITIES TRANSFER AGENTS MEDALLION PROGRAM, THE NEW
YORK STOCK EXCHANGE MEDALLION SIGNATURE PROGRAM OR THE STOCK EXCHANGES MEDALLION
PROGRAM (EACH, AN "ELIGIBLE INSTITUTION").
SIGNATURES ON THIS LETTER NEED NOT BE GUARANTEED BY AN ELIGIBLE
INSTITUTION, PROVIDED THE OLD NOTES ARE TENDERED: (I) BY A REGISTERED HOLDER OF
OLD NOTES (WHICH TERM, FOR PURPOSES OF THE EXCHANGE OFFER, INCLUDES ANY
PARTICIPANT IN THE BOOK-ENTRY TRANSFER FACILITY SYSTEM WHOSE NAME APPEARS ON A
SECURITY POSITION LISTING AS THE HOLDER OF SUCH OLD NOTES) WHO HAS NOT COMPLETED
THE BOX ENTITLED "SPECIAL ISSUANCE INSTRUCTIONS" OR "SPECIAL DELIVERY
INSTRUCTIONS" ON THIS LETTER, OR (II) FOR THE ACCOUNT OF AN ELIGIBLE
INSTITUTION.
4. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS.
Tendering Holders of Old Notes should indicate in the applicable box
the name and address to which New Notes issued pursuant to the Exchange Offer
and/or substitute certificates evidencing Old Notes not exchanged are to be
issued or sent, if different from the name or address of the person signing this
Letter. In the case of issuance in a different name, the employer identification
or social security number of the person named must also be indicated. Holders
tendering Old Notes by book-entry transfer may request that Old Notes not
exchanged be credited to such account maintained at the Book-Entry Transfer
Facility as such Holder may designate hereon. If no such instructions are given,
such Old Notes not exchanged will be returned to the name and address of the
person signing this Letter.
<PAGE> 11
5. TRANSFER TAXES.
The Company will pay all transfer taxes, if any, applicable to the
transfer of Old Notes to it or its order pursuant to the Exchange Offer. If,
however, New Notes and/or substitute Old Notes not exchanged are to be delivered
to, or are to be registered or issued in the name of, any person other than the
Holder of the Old Notes tendered hereby, or if tendered Old Notes are registered
in the name of any person other than the person signing this Letter, or if a
transfer tax is imposed for any reason other than the transfer of Old Notes to
the Company or its order pursuant to the Exchange Offer, the amount of any such
transfer taxes (whether imposed on the registered holder or any other persons)
will be payable by the tendering Holder. If satisfactory evidence of payment of
such taxes or exemption therefrom is not submitted herewith, the amount of such
transfer taxes will be billed to such tendering Holder and the Exchange Agent
will retain possession of an amount of New Notes with a face amount equal to the
amount of such transfer taxes due by such tendering Holder pending receipt by
the Exchange Agent of the amount of such taxes.
Except as provided in this Instruction 5, it will not be necessary for
transfer tax stamps to be affixed to the Old Notes specified in this Letter.
6. WAIVER OF CONDITIONS
The Company reserves the absolute right to waive satisfaction of any or
all conditions enumerated in the Prospectus.
7. NO CONDITIONAL TENDERS.
No alternative, conditional, irregular or contingent tenders will be
accepted. All tendering Holders of Old Notes, by execution of this Letter, shall
waive any right to receive notice of the acceptance of their Old Notes for
exchange.
Although the Company intends to notify Holders of defects or
irregularities with respect to tenders of Old Notes, neither the Company, the
Exchange Agent nor any other person shall incur any liability for failure to
give any such notice.
8. MUTILATED, LOST, STOLEN OR DESTROYED OLD NOTES.
Any Holder whose Old Notes have been mutilated, lost, stolen or
destroyed should contact the Exchange Agent at the address indicated above for
further instructions.
W9. WITHDRAWAL OF TENDERS.
Tenders of Old Notes may be withdrawn at any time prior to 5:00 P.M.,
New York City time, on the Expiration Date. For a withdrawal to be effective, a
written notice of withdrawal must be received by the Exchange Agent at one of
the addresses set forth above. Any such notice of withdrawal must specify the
name of the person having tendered the Old Notes to be withdrawn, identify the
Old Notes to be withdrawn (including the principal amount of such Old Notes),
and (where certificates for Old Notes have been transmitted) specify the name in
which such Old Notes are registered, if different from that of the withdrawing
Holder. If certificates for Old Notes have been delivered or otherwise
identified to the Exchange Agent, then prior to the release of such certificates
the withdrawing Holder must also submit the serial numbers of the particular
certificates to be withdrawn and a signed notice of withdrawal with signatures
guaranteed by an Eligible Institution unless such Holder is an Eligible
Institution in which case such guarantee will not be required. If Old Notes have
been tendered pursuant to the procedure for book-entry transfer described above,
any notice of withdrawal must specify the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn Old Notes and
otherwise comply with the procedures of such facility. All questions as to the
validity, form and eligibility (including time of receipt) of such notices will
be determined by the Company, whose determination will be final and binding on
all parties. Any Old Notes so withdrawn will be deemed not to have been validly
tendered for exchange for purposes of the Exchange Offer. Any Old Notes which
have been tendered for exchange but which are not exchanged for any
<PAGE> 12
reason will be returned to the Holder thereof without cost to such Holder (or,
in the case of Old Notes tendered by book-entry transfer into the Exchange
Agent's account at the Book Entry Transfer Facility pursuant to the book-entry
transfer procedures described above, such Old Notes will be credited to an
account maintained with such Book-Entry Transfer Facility for the Old Notes) as
soon as practicable after withdrawal, rejection of tender or termination of the
Exchange Offer. Properly withdrawn Old Notes may be retendered by following one
of the procedures set forth in "The Exchange Offer - Procedures for Tendering "
set forth in the Prospectus at any time on or prior to the Expiration Date.
10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.
Questions relating to the procedure for tendering, as well as requests
for additional copies of the Prospectus, this Letter and other related documents
may be directed to the Exchange Agent, at (513) 632-4278.
<PAGE> 1
Exhibit 99.2
THE KROGER CO.
NOTICE OF GUARANTEED DELIVERY FOR TENDER OF ANY AND ALL OF THE
OUTSTANDING
SERIES A 6.34% SENIOR NOTES DUE 2001,
SERIES A 7.25% SENIOR NOTES DUE 2009 AND/OR
SERIES A 7.70% SENIOR NOTES DUE 2029
OF THE KROGER CO. WHICH HAVE BEEN FULLY AND UNCONDITIONALLY
GUARANTEED BY CERTAIN SUBSIDIARIES OF THE KROGER CO. NOT
FORBIDDEN TO ISSUE SUCH GUARANTEE.
This Notice of Guaranteed Delivery, or one substantially equivalent to
this form, must be used to accept the Exchange Offer (as defined below) if (i)
certificates for the Company's (as defined below) Series A 6.34% Senior Notes
Due 2001, Series A 7.25% Senior Notes Due 2009 and/or Series A 7.70% Senior
Notes Due 2029 (the "Old Notes") are not immediately available, (ii) Old Notes,
the Letter of Transmittal and all other required documents cannot be delivered
to Firstar Bank, National Association ("Exchange Agent") on or prior to the
Expiration Date (as defined in the Prospectus referred to below) or (iii) the
procedures for delivery by book-entry transfer cannot be completed on a timely
basis. This Notice of Guaranteed Delivery may be delivered by hand, overnight
courier or mail, or transmitted by facsimile transmission, to the Exchange Agent
on or prior to the Expiration Date. See "The Exchange Offer - Procedures for
Tendering" in the Prospectus. In addition, in order to utilize the guaranteed
delivery procedure to tender Old Notes pursuant to the Exchange Offer, a
completed, signed and dated Letter of Transmittal relating to the Old Notes (or
facsimile thereof) must also be received by the Exchange Agent prior to 5:00
p.m., New York City time, on the Expiration Date.
Capitalized terms used but not defined herein have the meanings given
them in the Prospectus.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
FIRSTAR BANK NATIONAL ASSOCIATION
BY REGISTERED OR CERTIFIED MAIL OR BY HAND OR OVERNIGHT COURIER:
FIRSTAR BANK, N.A.
425 WALNUT STREET
6TH FLOOR
CINCINNATI, OHIO 45202
FACSIMILE TRANSMISSIONS:
(ELIGIBLE INSTITUTIONS ONLY)
(513) 632-5511
TO CONFIRM BY TELEPHONE OR FOR INFORMATION CALL:
(513) 632-4278
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN
AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA
FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE
SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE
GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE
SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to The Kroger Co., an Ohio
corporation (the "Company"), upon the terms and subject to the conditions set
forth in the Prospectus dated _________, 1999 (as the same may be amended or
supplemented from time to time, the "Prospectus"), and the related Letter of
Transmittal (which together constitute the "Exchange Offer"), receipt of which
is hereby acknowledged, the aggregate principal amount of Old Notes set forth
below pursuant to the guaranteed delivery procedures set forth in the Prospectus
under the caption "The Exchange Offer - Guaranteed Delivery Procedures."
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
<S> <C>
Name(s) of Registered Holder(s): All authority herein conferred or
___________________________________ agreed to be conferred in this Notice
___________________________________ of Guaranteed Delivery shall survive
the death, incapacity or dissolution of
the undersigned and any obligation of
Address:___________________________ the undersigned hereunder shall be
___________________________________ binding upon the heirs, executors,
administrators, personal representatives,
trustees in bankruptcy, legal
representatives, successors and assigns
of the undersigned.
Certificate No.(s)(if available):__
___________________________________ PLEASE SIGN HERE:
_________________________________________
Total Principal amount _________________________________________
Represented by Old Notes:$_________
(Signature(s) of Owner(s)
or Authorized Signatory)
If Old Notes will be tendered by
Book entry Transfer, provide the
following information: ________________________________,1999
________________________________,1999
DTC Account Number:_________________
Area Code and
Date:__________________________,1999 Telephone number:____________________
</TABLE>
- --------------------------------------------------------------------------------
<PAGE> 3
- --------------------------------------------------------------------------------
Must be signed by the holder(s) of the Old Notes exactly as their name(s)
appear(s) on certificate(s) for the Old Notes or on a security position listing,
or by person(s) authorized to become registered holder(s) by endorsements and
documents transmitted with this Notice of Guaranteed Delivery. If signature is
by an attorney-in-fact, executor, administrator, trustee, guardian, officer of a
corporation or other person acting in a fiduciary or representative capacity,
please set forth the signer's full title and the other information below.
Names:__________________________________________________________________________
________________________________________________________________________________
Capacity:_______________________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
- --------------------------------------------------------------------------------
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED.
<PAGE> 4
- --------------------------------------------------------------------------------
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution," including (as such terms are defined therein): (i) a bank; (ii) a
broker, dealer, municipal securities broker, municipal securities dealer,
government securities broker or government securities dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association or
clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association recognized program (each of the foregoing being
referred to as an "Eligible Institution"), hereby guarantees to deliver to the
Exchange Agent, at one of its addresses set forth above, either the Old Notes
tendered hereby in proper form for transfer, or confirmation of the book-entry
transfer of such Old Notes to the Exchange Agent's account at The Depository
Trust Company ("DTC"), pursuant to the procedures for book-entry transfer set
forth in the Prospectus, in either case together with one or more properly
completed and duly executed Letter(s) of Transmittal (or facsimile thereof) and
any other required documents within three NYSE trading days after the date of
execution of this Notice of Guaranteed Delivery.
The undersigned acknowledges that it must deliver the Letter(s) of
Transmittal (or facsimile thereof) and the Old Notes tendered hereby to the
Exchange Agent within the time period set forth above and that failure to do so
could result in a financial loss to the undersigned.
___________________________________ _____________________________________
Name of Firm Authorized Signature
___________________________________ Name:________________________________
Address (Please Type or Print)
___________________________________ Title_________________________________
(Zip Code)
___________________________________ Date:_________________________________
Area code and telephone number
- --------------------------------------------------------------------------------
NOTE: DO NOT SEND CERTIFICATES FOR OLD NOTES WITH THIS NOTICE OF GUARANTEED
DELIVERY. ACTUAL SURRENDER OF OLD NOTES MUST BE MADE PURSUANT TO, AND BE
ACCOMPANIED BY A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL AND
ANY OTHER REQUIRED DOCUMENTS.
<PAGE> 1
Exhibit 99.3
INSTRUCTIONS TO REGISTERED HOLDER
AND/OR BOOK-ENTRY TRANSFER FACILITY PARTICIPANT
FROM BENEFICIAL OWNER
OF
SERIES A 6.34% SENIOR NOTES DUE 2001,
SERIES A 7.25% SENI0R NOTES DUE 2009
AND/OR SERIES A 7.70% SENIOR NOTES DUE 2029
OF
THE KROGER CO.
To Registered Holder and/or Participant of the Book-Entry Transfer Facility:
The undersigned hereby acknowledges receipt of the Prospectus, dated
________, 1999 (the "Prospectus"), of The Kroger Co., an Ohio corporation
(the "Company") and the accompanying Letter of Transmittal (the "Letter of
Transmittal"), that together constitute the Company's offer (the "Exchange
Offer"). Capitalized terms used but not defined herein have the meanings
ascribed to them in the Prospectus.
This will instruct you, the registered holder and/or book-entry
transfer facility participant, as to action to be taken by you relating to the
Exchange Offer with respect to the Series A 6.34% Senior Notes due 2001, Series
A 7.25% Senior Notes due 2009 and Series A 7.70% Senior Notes due 2029 (the "Old
Notes") held by you for the account of the undersigned.
The aggregate face amount of the Old Notes held by you for the account
of the undersigned is (FILL IN AMOUNT):
$ ___________________ of the 6.34% Series A Senior Notes due 2001
$ ___________________ of the 7.25% Series A Senior Notes due 2009
$ ___________________ of the 7.70% Series A Senior Notes due 2029
With respect to the Exchange Offer, the undersigned hereby instructs
you (CHECK APPROPRIATE BOX):
[_] TO TENDER the following Old Notes held by you for the account of
the undersigned (INSERT PRINCIPAL AMOUNT OF NOTES TO BE TENDERED, IF ANY):
$ ___________________ of the 6.34% Series A Senior Notes due 2001.
$ ___________________ of the 7.25% Series A Senior Notes due 2009
$ ___________________ of the 7.70% Series A Senior Notes due 2029
[_] NOT TO TENDER any Old Notes held by you for the account of the
undersigned.
If the undersigned instructs you to tender the Old Notes held by you
for the account of the undersigned, it is understood that you are authorized (a)
to make, on behalf of the undersigned (and the undersigned, by its signature
below, hereby makes to you), the representations and warranties contained in the
Letter of Transmittal that are to be made with respect to the undersigned as a
beneficial owner, including but not limited to the representations that (i) the
undersigned is acquiring the New Notes in the ordinary course of business of the
undersigned, (ii) the undersigned is not participating, does not
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participate, and has no arrangement or understanding with any person to
participate in the distribution of the New Notes, (iii) the undersigned
acknowledges that any person participating in the Exchange Offer for the purpose
of distributing the New Notes must comply with the registration and prospectus
delivery requirements of the Securities Act of 1933, as amended (the "Securities
Act"), in connection with a secondary resale transaction of the New Notes
acquired by such person and cannot rely on the position of the Staff of the
Securities and Exchange Commission set forth in no-action letters that are
discussed in the section of the Prospectus entitled "The Exchange Offer -Purpose
and Effect," and (iv) the undersigned is not an "affiliate," as defined in Rule
405 under the Securities Act, of the Company; (b) to agree, on behalf of the
undersigned, as set forth in the Letter of Transmittal; and (c) to take such
other action as necessary under the Prospectus or the Letter of Transmittal to
effect the valid tender of such Old Notes.
SIGN HERE
Name of Beneficial Owners:____________________________________
Signature(s):_________________________________________________
Names (please print):_________________________________________
Address:
______________________________________________________________
______________________________________________________________
______________________________________________________________
Telephone
Number:_______________________________________________________
Taxpayer Identification or Social Security Number:____________
Date:_________________________________________________________
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