<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 29, 1999
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
THE HOME DEPOT, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 5211 95-3261426
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
2455 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
(770) 433-8211
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
ARTHUR M. BLANK
PRESIDENT AND CHIEF EXECUTIVE OFFICER
2455 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
PHONE: (770) 433-8211
Name, address, including zip code, and telephone number, including area code, of
agent for service)
COPIES TO:
<TABLE>
<S> <C>
KELLY R. CAFFARELLI, ESQ. JEFFREY M. STEIN
THE HOME DEPOT, INC. KING & SPALDING
2455 PACES FERRY ROAD 191 PEACHTREE STREET
ATLANTA, GEORGIA 30339 ATLANTA, GEORGIA 30303
PHONE: (770) 433-8211 PHONE: (404) 572-4600
</TABLE>
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED EXCHANGE OFFER: As soon as
practicable following the effectiveness of this Registration Statement.
If any 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
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS AMOUNT TO BE OFFERING PRICE PER AGGREGATE REGISTRATION
OF SECURITIES TO BE REGISTERED REGISTERED UNIT(1) OFFERING PRICE(1) FEE(2)
<S> <C> <C> <C> <C>
6 1/2% Senior Notes Due September 15, 2004 $500,000,000 100% $500,000,000 $ 139,000
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee under
Rule 457 of the Securities Act of 1933.
(2) The registration fee for the securities offered hereby has been calculated
under Rule 457(f)(2) of the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT 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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION, DATED OCTOBER 29, 1999
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.
<PAGE>
PROSPECTUS
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR
ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON , 1999, UNLESS EXTENDED.
------------------------
- HOME DEPOT IS OFFERING TO EXCHANGE REGISTERED 6 1/2% SENIOR NOTES DUE
SEPTEMBER 15, 2004 FOR ALL OF ITS ORIGINAL UNREGISTERED 6 1/2% SENIOR
NOTES DUE SEPTEMBER 15, 2004.
- THE TERMS OF THE NEW NOTES ARE IDENTICAL IN ALL MATERIAL RESPECTS TO THE
TERMS OF THE OLD NOTES, EXCEPT THAT THE REGISTRATION RIGHTS AND RELATED
LIQUIDATED DAMAGES PROVISIONS AND THE TRANSFER RESTRICTIONS APPLICABLE TO
THE ORIGINAL NOTES ARE NOT APPLICABLE TO THE NEW NOTES.
- SUBJECT TO THE SATISFACTION OR WAIVER OF SPECIFIED CONDITIONS, HOME DEPOT
WILL EXCHANGE THE NEW NOTES FOR ALL OLD NOTES THAT ARE VALIDLY TENDERED
AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE EXCHANGE OFFER.
- THE EXCHANGE OF OLD NOTES FOR NEW NOTES PURSUANT TO THE EXCHANGE OFFER
GENERALLY WILL NOT BE A TAXABLE EVENT FOR U.S. FEDERAL INCOME TAX
PURPOSES. SEE "U.S. FEDERAL INCOME TAX CONSEQUENCES."
- HOME DEPOT WILL NOT RECEIVE ANY PROCEEDS FROM THE EXCHANGE OFFER.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The date of this prospectus is , 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
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PAGE
----
<S> <C>
WHERE YOU CAN FIND MORE INFORMATION......................... 1
INCORPORATION OF DOCUMENTS BY REFERENCE..................... 1
PROSPECTUS SUMMARY.......................................... 3
HOME DEPOT.................................................. 6
USE OF PROCEEDS............................................. 7
CAPITALIZATION.............................................. 7
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA.......... 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION........................ 9
CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING
STATEMENTS................................................ 15
THE EXCHANGE OFFER.......................................... 17
DESCRIPTION OF THE NEW NOTES................................ 26
U.S. FEDERAL INCOME TAX CONSEQUENCES........................ 40
PLAN OF DISTRIBUTION........................................ 40
LEGAL MATTERS............................................... 41
EXPERTS..................................................... 41
</TABLE>
i
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
The Home Depot, Inc. ("we," the "Company" or "Home Depot") files annual,
quarterly and special reports, proxy statements and other information with the
Securities and Exchange Commission. Our SEC filings are available over the
Internet at the SEC's web site at http: //www.sec.gov. You may also read and
copy any document we file with the SEC at its public reference facilities:
<TABLE>
<S> <C> <C>
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-2511
</TABLE>
You may also obtain copies of the documents at prescribed rates by writing
to the Public Reference Section of the SEC at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549. Please call 1-800-SEC-0330 for further information on
the operations of the public reference facilities. Our SEC filings are also
available at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" in this prospectus the
information we file with the SEC, which means:
- incorporated documents are considered part of this prospectus;
- we can disclose important information to you by referring you to those
documents; and
- information that we file with the SEC will automatically update and
supersede the information in this prospectus and any information that was
previously incorporated in this prospectus.
We incorporate by reference the documents listed below which were filed with
the SEC under the Securities Exchange Act of 1934:
(1) our Annual Report on Form 10-K for the year ended January 31, 1999,
filed on April 19, 1999; and
(2) our Quarterly Report on Form 10-Q for the quarters ended May 2, 1999
filed on June 3, 1999 and August 1, 1999, filed on August 27, 1999.
We also incorporate by reference each of the following documents that we
will file with the SEC after the date of this prospectus and prior to the
termination of the offering:
- reports filed under Section 13(a) and (c) of the Exchange Act;
- definitive proxy or information statements filed under Section 14 of the
Exchange Act in connection with any subsequent stockholders' meeting; and
- reports filed under Section 15(d) of the Exchange Act.
1
<PAGE>
You can obtain any of the filings incorporated by reference in this
prospectus through us or from the SEC through the SEC's web site or at the
addresses listed above. Documents incorporated by reference are available from
us without charge, excluding any exhibits to those documents that are not
specifically incorporated by reference in such documents. You can request a copy
of the documents incorporated by reference in this prospectus by requesting them
in writing or by telephone from us at the following address:
The Home Depot, Inc.
2455 Paces Ferry Road
Atlanta, Georgia 30339-4024
Attention: Investor Relations
Telephone: (770) 433-8211
If you would like to request documents, please do so by , 1999
in order to receive them before the exchange offer expires on ,
1999.
The exchange offer is not being made to, nor will Home Depot accept
surrenders for exchange from, holders of old notes in any jurisdiction in which
the exchange offer or the acceptance thereof would not be in compliance with the
securities or blue sky laws of such jurisdiction.
2
<PAGE>
PROSPECTUS SUMMARY
This brief summary highlights selected information from the prospectus. It
may not contain all of the information that is important to you. Home Depot
urges you to carefully read and review the entire prospectus and the other
documents to which it refers to fully understand the terms of the new notes and
the exchange offer.
SUMMARY OF THE TERMS OF THE EXCHANGE OFFER
<TABLE>
<S> <C>
General.............................. On September 27, 1999, Home Depot completed a private
offering of the old notes, which consist of $500 million
aggregate principal amount of its 6 1/2% Senior Notes Due
September 15, 2004. In connection with the private offering,
Home Depot entered into a registration rights agreement in
which it agreed, among other things, to deliver this
prospectus to you and to complete an exchange offer for the
old notes.
The exchange offer................... We are offering to exchange $1,000 principal amount of our
registered 6 1/2% Senior Notes Due September 15, 2004, which
we refer to as the "new notes," for each $1,000 principal
amount of our unregistered 6 1/2% Senior Notes Due September
15, 2004, which we refer to as the "old notes."
We sometimes will refer to the new notes and the old notes
together as the "notes." Currently, $500 million principal
amount of old notes are outstanding.
The terms of the new notes are identical in all material
respects to the terms of the old notes, except that the
registration rights and related liquidated damages
provisions and the transfer restrictions applicable to the
old notes are not applicable to the new notes.
Old notes may be tendered only in $1,000 increments. Subject
to the satisfaction or waiver of specified conditions, Home
Depot will exchange the new notes for all old notes that are
validly tendered and not withdrawn prior to the expiration
of the exchange offer. Home Depot will cause the exchange to
be effected promptly after the expiration of the exchange
offer.
UPON COMPLETION OF THE EXCHANGE OFFER, THERE MAY BE NO
MARKET FOR THE OLD NOTES AND YOU MAY HAVE DIFFICULTY SELLING
THEM.
Expiration date...................... The exchange offer will expire at 5:00 p.m., New York City
time, on, , 1999 unless we extend it. In that case,
the phrase "expiration date" will mean the latest date and
time to which we extend the exchange offer.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
Procedures for participating in the
exchange offer..................... If you wish to participate in the exchange offer, you must
complete, sign and date an original or faxed letter of
transmittal in accordance with the instructions in the
letter of transmittal accompanying this prospectus. Then you
must mail, fax or deliver the completed letter of
transmittal together with the old notes you wish to exchange
and any other required documentation to The Bank of New
York, which is acting as exchange agent. Its address appears
on the letter of transmittal. By signing the letter of
transmittal you will represent to and agree with Home Depot
that, you are acquiring the new notes in the ordinary course
of your business; you have no arrangement or understanding
with anyone to participate in a distribution of the new
notes; and you are not an "affiliate," as defined in Rule
405 under the Securities Act, of Home Depot.
If you are a broker-dealer that will receive new notes for
your own account in exchange for old notes that you acquired
as a result of your market-making or other trading
activities, you will be required to acknowledge in the
letter of transmittal that you will deliver a prospectus in
connection with any resale of such new notes.
Resale of new notes.................. We believe that you can resell and transfer your new notes
without registering them under the Securities Act and
delivering a prospectus, if you can make the same three
representations that appear above under the heading
"Procedures for participating in the exchange offer." Our
belief is based on interpretations of the SEC for other
exchange offers that the SEC expressed in some of the SEC's
no-action letters to other issuers in exchange offers like
ours.
We cannot guarantee that the SEC would make a similar
decision about this exchange offer. If our belief is wrong,
or if you cannot truthfully make the representations
appearing above, and you transfer any new note issued to you
in the exchange offer without meeting the registration and
prospectus delivery requirements of the Securities Act, or
without an exemption from such requirements, you could incur
liability under the Securities Act. We are not indemnifying
you for any such liability. A broker-dealer can only resell
or transfer new notes if it will deliver a prospectus.
Special procedures for beneficial
owners............................. If your old notes are held through a broker, dealer,
commercial bank, trust company or other nominee and you wish
to surrender your old notes, you should contact your
intermediary promptly and instruct it to surrender the old
notes on your behalf.
Guaranteed delivery
procedures......................... If you cannot meet the expiration date deadline, or you
cannot deliver your old notes, the letter of transmittal or
any other documentation on time, then you must surrender
your old notes according to the guaranteed delivery
procedures appearing below under "The Exchange
Offer--Guaranteed Delivery Procedures."
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
Acceptance of your old notes and
delivery of the new
notes.............................. We will accept for exchange any and all old notes that are
surrendered in the exchange offer prior to the expiration
date if you comply with the procedures of the offer. The new
notes will be delivered on the earliest practicable date
after the expiration date.
Withdrawal rights.................... You may withdraw the surrender of your old notes at any time
prior to the expiration date.
U.S. federal income tax
consequences....................... You will not have to pay federal income tax as a result of
your participation in the exchange offer.
Exchange agent....................... The Bank of New York is serving as the exchange agent in
connection with the exchange offer. The Bank of New York
also serves as trustee under the indenture that governs the
notes.
</TABLE>
SUMMARY OF THE TERMS OF THE NEW NOTES
The terms of the new notes are identical in all material respects to the
terms of the old notes, except that the registration rights and related
liquidated damages provisions and the transfer restrictions applicable to the
old notes are not applicable to the new notes. The new notes will evidence the
same debt as the old notes. The new notes and the old notes will be governed by
the same indenture.
<TABLE>
<S> <C>
Aggregate Amount..................... $500 million principal amount of 6 1/2% Senior Notes Due
September 15, 2004.
Interest Payment Dates............... September 15 and March 15 of each year, commencing March 15,
2000.
Maturity Date........................ The new notes mature on September 15, 2004.
Optional Redemption.................. Home Depot, at its option, may redeem all or any portion of
the notes on not less than 30 nor more than 60 days' prior
notice at the redemption price stated in "Description of the
New Notes--Redemption" plus accrued interest to the date of
redemption.
Events of Default.................... The indenture describes the circumstances that constitute
events of default with respect to the new notes. See
"Description of the New Notes--Events of Default."
Restrictive Covenants................ The indenture imposes limitations on the ability of Home
Depot and its subsidiaries to, among other things, create
liens, enter into certain sale and leaseback transactions,
and consolidate or merge with or sell all or substantially
all of its assets to another person. See "Description of the
New Notes--Certain Covenants."
Use of Proceeds...................... Home Depot will not receive any proceeds from the exchange
offer.
</TABLE>
5
<PAGE>
HOME DEPOT
The Home Depot, Inc. is the leading retailer in the home improvement
industry and ranks among the ten largest retailers in the United States based on
its net sales volume for fiscal 1998. At August 1, 1999, we were operating 846
retail stores, which included 784 Home Depot-Registered Trademark- stores in the
United States, 12 EXPO Design Center(SM) stores and one Villager's Hardware test
store in the United States and 49 Home Depot stores in international markets (45
stores in Canada, two stores in Chile and two stores in Puerto Rico). In
addition, we also offer home improvement products through our two direct
marketing subsidiaries, Maintenance Warehouse-Registered Trademark- and National
Blinds and Wallpaper, Inc.,(SM) and through our newly acquired lighting
subsidiary, Georgia Lighting, Inc. In addition to our leading market presence,
we are also the home improvement industry leader in terms of store productivity
and operating profit margin. In recognition of our industry leadership position
and consistent, strong financial performance, we have been named America's most
admired specialty retailer by FORTUNE magazine for the past six consecutive
years.
- We have experienced 13 consecutive years of record sales, with net sales
of $30.2 billion in fiscal 1998, which represented a 25.1% increase from
fiscal 1997, including comparable store sales growth of 7.0%. Net sales in
the first six months of fiscal 1999 were $19.4 billion, which represented
a 27.0% increase from the first six months of fiscal 1998, including
comparable store sales growth of 11.0% in the second quarter.
- We have experienced 13 consecutive years of record earnings, with net
earnings as a percentage of sales of 5.3% in fiscal 1998, compared to 4.8%
for fiscal 1997. Net earnings as a percentage of sales in the first six
months of fiscal 1999 were 6.0%, compared to 5.3% for the first six months
of fiscal 1998.
- We have consistently expanded our store base since our formation, with 137
new store openings in fiscal 1998, which represented a 22% increase in
total stores from fiscal 1997.
- We have allocated resources efficiently to increase our return on invested
capital and maintain financial flexibility. We believe that our strong
capitalization profile is one of our principal competitive advantages.
Our principal executive offices are located at 2455 Paces Ferry Road,
Atlanta, Georgia 30339, and our telephone number is (770) 433-8211.
6
<PAGE>
USE OF PROCEEDS
This exchange offer is intended to satisfy our obligations under our
registration rights agreement. We will not receive any proceeds from the
exchange offer. You will receive, in exchange for old notes tendered by you in
the exchange offer, new notes in like principal amount. The old notes
surrendered in exchange for the new notes will be retired and cancelled and
cannot be reissued. Accordingly, the issuance of the new notes will not result
in any increase of our outstanding debt.
CAPITALIZATION
The following table sets forth our consolidated capitalization at August 1,
1999 and as adjusted to give effect to the sale of the Notes. This table should
be read in conjunction with our consolidated financial statements, including the
notes to those consolidated financial statements, and other information set
forth in the reports we have filed with the SEC. See "Where You Can Find More
Information."
<TABLE>
<CAPTION>
AUGUST 1, 1999
-------------------
AS
ACTUAL ADJUSTED
-------- --------
(UNAUDITED, IN
MILLIONS)
<S> <C> <C>
Cash and Cash Equivalents (1)............................... $ 520 $ 1,017
======= =======
Long-Term Debt:
6 1/2% Senior Notes Due 2004............................... -- $ 500
3 1/4% Convertible Subordinated Notes...................... $ 1,103 1,103
Capital Lease Obligations.................................. 198 198
Installment Notes Payable.................................. 20 20
Unsecured Bank Loan........................................ 14 14
Variable Rate Industrial Revenue Bonds..................... 3 3
------- -------
Total Long-Term Debt.................................... $ 1,338 $ 1,838
------- -------
Stockholders' Equity:
Common Stock............................................... $ 74 $ 74
Additional Paid-In Capital................................. 3,071 3,071
Retained Earnings.......................................... 6,941 6,941
Accumulated Other Comprehensive Income..................... (61) (61)
Assets in Trust............................................ (5) (5)
------- -------
Total Stockholders' Equity.............................. $10,020 $10,020
------- -------
Total Capitalization.................................... $11,358 $11,858
======= =======
</TABLE>
- ------------------------
(1) Includes short-term investments of $2 million.
7
<PAGE>
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA
The selected consolidated financial data under the captions "Income
Statement Data" and "Balance Sheet Data" of Home Depot for, and as of the end
of, each of the periods indicated in the five-year period ended January 31,
1999, have been derived from the audited consolidated financial statements of
Home Depot, which consolidated financial statements have been audited by KPMG
LLP. The consolidated financial statements as of January 31, 1999 and
February 1, 1998, and for each of the years in the three-year period ended
January 31, 1999, and the report thereon, are incorporated by reference
elsewhere in this prospectus. The selected consolidated financial data for each
of the six month periods ended August 2, 1998 and August 1, 1999, and as of
August 2, 1998 and August 1, 1999, have been derived from the unaudited
consolidated financial statements of Home Depot, which reflect, in the opinion
of management of Home Depot, all adjustments, which include only normal
recurring adjustments, necessary for the fair presentation of the financial data
for those periods. The results for the interim periods are not necessarily
indicative of the results for the full year. The information presented below
under the caption "Other Data" is unaudited. The selected consolidated financial
and operating data should be read in conjunction with the consolidated financial
statements of Home Depot, including the notes to those consolidated financial
statements, and the audit reports of KPMG LLP.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FISCAL YEAR(1) -----------------------
--------------------------------------------------------- AUGUST 2, AUGUST 1,
1994 1995 1996 1997 1998 1998 1999
--------- --------- --------- --------- --------- ---------- ----------
(AMOUNTS IN MILLIONS, EXCEPT NUMBER OF STORES AND SALES PER SQUARE FOOT DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales.................... $12,477 $15,470 $19,535 $24,156 $30,219 $15,263 $19,383
Gross Profit................. 3,485 4,286 5,434 6,781 8,605 4,232 5,595
Operating Income............. 987 1,180 1,526 1,896 2,661 1,331 1,927
Interest, Net................ (7) 15 9 2 (7) (6) (4)
Net Earnings................. 605 732 938 1,160 1,614 804 1,169
OTHER DATA
EBITDA(2).................... $ 1,117 $ 1,361 $ 1,758 $ 2,179 $ 3,034 $ 1,511 $ 2,148
Ratio of Earnings to Fixed
Charges(3)................. 11.5x 17.7x 18.0x 16.7x 19.6x 20.3x 26.0x
Comparable Store Sales
Increase................... 8% 3% 7% 7% 7% 7% 10%
Number of Stores at End of
Period..................... 340 423 512 624 761 679 846
Weighted Average Sales per
Square Foot................ $ 404 $ 390 $ 398(4) $ 406 $ 410 $ 436 $ 450
BALANCE SHEET DATA
Total Assets................. $ 5,778 $ 7,354 $ 9,342 $11,229 $13,465 $12,593 $15,709
Total Long-term Debt......... 983 720 1,247 1,303 1,566 1,317 1,338
Total Stockholders' Equity... 3,442 4,988 5,955 7,098 8,740 7,905 10,020
</TABLE>
- ------------------------
(1) Fiscal years 1994, 1995, 1996, 1997 and 1998 refer to the fiscal years ended
January 29, 1995; January 28, 1996; February 2, 1997; February 1, 1998; and
January 31, 1999, respectively. Fiscal year 1996 consisted of 53 weeks.
(2) EBITDA is defined as operating income plus depreciation and amortization.
(3) For purposes of computing the ratios of earnings to fixed charges,
"earnings" consist of earnings before income taxes and minority interest
plus fixed charges, excluding capitalized interest. "Fixed charges" consist
of interest incurred on indebtedness, amortization of debt expense and the
portion of rental expense under operating leases deemed to be the equivalent
of interest. The ratios of earnings to fixed charges are calculated as
follows:
(Income before income taxes and minority interest) + (fixed charges) -
(capitalized interest)
(fixed charges)
(4) Adjusted to reflect the first 52 weeks of the 53-week fiscal year in 1996.
8
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
The following section is substantially similar to the Management's
Discussion and Analysis of Results of Operations and Financial Condition
sections of our most recent Annual Report on Form 10-K and our Quarterly Reports
on Form 10-Q, which have been filed with the SEC. You should read this section
together with the consolidated financial statements included in those reports.
To obtain a copy of our most recent Annual Report and our Quarterly Reports, see
"Where You Can Find More Information."
RESULTS OF OPERATIONS
SIX MONTHS ENDED AUGUST 1, 1999 COMPARED TO SIX MONTHS ENDED AUGUST 2, 1998
The data below reflects selected sales data, the percentage relationship
between sales and major categories in the Consolidated Statements of Earnings
and the percentage change in the dollar amounts of each of the items.
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERCENTAGE
--------------------- INCREASE
AUGUST 2, AUGUST 1, (DECREASE) IN
1998 1999 DOLLAR AMOUNTS
--------- --------- --------------
<S> <C> <C> <C>
SELECTED CONSOLIDATED STATEMENTS OF EARNINGS DATA
Net Sales................................................. 100.0% 100.0% 27.0%
Gross Profit.............................................. 27.7 28.8 32.2
Operating Expenses:
Selling and Store Operating............................. 17.2 17.0 26.2
Pre-Opening............................................. 0.2 0.3 45.9
General and Administrative.............................. 1.6 1.6 26.2
Total Operating Expenses.............................. 19.0 18.9 26.4
Operating Income...................................... 8.7 9.9 44.8
Interest Income (Expense):
Interest and Investment Income.......................... 0.1 0.1 (13.3)
Interest Expense........................................ (0.1) (0.1) (19.0)
Interest, Net......................................... 0.0 0.0 (33.3)
Earning Before Income Taxes........................... 8.7 9.9 45.1
Income Taxes.............................................. 3.4 3.9 44.7
Net Earnings.......................................... 5.3% 6.0% 45.4
SELECTED CONSOLIDATED SALES DATA
Number of Transactions (000's)............................ 335,810 400,666 19.3%
Average Sale Per Transaction.............................. $45.08 $48.04 6.6
Weighted Average Weekly Sales Per Operating Store
(000's)................................................. $894 $929 3.9
Weighted Average Sales Per Square Foot.................... $436 $450 3.2
</TABLE>
Sales for the first six months of fiscal 1999 increased 27.0% to
$19.383 billion from $15.263 billion for the comparable period in fiscal 1998.
The sales increase for such period was primarily attributable to new stores (846
stores open at the end of the first six months of fiscal 1999 compared with 679
at the end of the first six months of fiscal 1998) and a comparable
store-for-store sales increase of 10% for the first six months of fiscal 1999.
Gross profit as a percent of sales was 28.8% for the first six months of
fiscal 1999 compared with 27.7% for the comparable period of fiscal 1998. The
gross profit rate increase for such period was primarily attributable to the
ongoing benefits of product line reviews which have resulted in lower costs
9
<PAGE>
of merchandise and more effective product assortments, cost reductions through
direct sourcing of imports, the roll-out of tool rental centers, and better
shrink results have contributed to the higher gross margin rate.
Total operating expenses decreased to 18.9% for the first six months of
fiscal 1999 from 19.0% for the comparable period in fiscal 1998. Selling and
store operating expenses as a percent of sales decreased to 17.0% for the first
six months of fiscal 1999 from 17.2% for the comparable period in 1998. This
decrease was due primarily to lower net advertising and leverage achieved from
high comparable store sales, offset partially by higher credit card discounts
due to a higher penetration of credit card sales and discount rate increases.
Net advertising expenses decreased as a percent of sales due to higher co-op
support from vendors, increased national advertising and cost leverage achieved
from opening new stores in existing markets. Also contributing to the decrease
were store payroll salaries and wages, which continue to show productivity
improvement in terms of sales generated per labor hour. We also leveraged
occupancy and certain operating expenses due to the high comparable store sales.
Partially offsetting these decreases were higher costs for store bonus plans due
to our strong financial results for the first six months of fiscal 1999. In
addition, credit card discounts for the first six months of fiscal 1999 were
higher than the comparable period of fiscal 1998 as a percent of sales.
Pre-opening expenses as a percent of sales were 0.3% for the first six
months of fiscal 1999 compared to 0.2% for the first six months of fiscal 1998.
During the first six months of fiscal 1999, we opened 86 stores, relocated five
stores, and temporarily closed one store compared with 55 new stores opened and
one store relocation during the first six months of fiscal 1998. General and
administrative expenses as a percent of sales were 1.6% for the first six months
of both fiscal 1999 and fiscal 1998.
Net interest as a percent of sales was 0.0% for the first six months of both
fiscal 1999 and fiscal 1998. As a percent of sales, interest and investment
income was 0.1% for the first six months of fiscal 1999 and the comparable
period of fiscal 1998. Interest expense as a percent of sales was 0.1% for both
periods.
Home Depot's combined federal and state effective income tax rate decreased
to 39.2% for the first six months of fiscal 1999 from 39.3% for the comparable
period of fiscal 1998. During the fourth quarter of fiscal 1998, an adjustment
was made to lower the annual effective tax rate to 39.2%.
Net earnings as a percent of sales increased to 6.0% for the first six
months of fiscal 1999 from 5.3% for the first six months of fiscal 1998. The
increases as a percent of sales for fiscal 1999 were primarily attributable to
higher gross margin rates and lower selling and store operating expenses as a
percent of sales, as described above.
10
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ANNUAL DISCUSSION
The data below reflect selected sales data, the percentage relationship
between sales and major categories in the Consolidated Statements of Earnings
and the percentage change in the dollar amounts of each of the items.
<TABLE>
<CAPTION>
PERCENTAGE
INCREASE
(DECREASE) IN
DOLLAR AMOUNTS
FISCAL YEAR(1) -------------------
-------------- 1997 VS. 1998 VS.
1996 1997 1998 1996 1997
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
SELECTED CONSOLIDATED STATEMENTS OF EARNINGS
DATA
Net Sales..................................... 100.0% 100.0% 100.0% 23.7% 25.1%
Gross Profit.................................. 27.8 28.1 28.5 24.8 26.9
Operating Expenses:
Selling and Store Operating(2).............. 18.0 17.8 17.7 21.9 24.1
Pre-Opening................................. 0.3 0.3 0.3 19.7 34.1
General and Administrative.................. 1.7 1.7 1.7 27.2 24.9
Non-Recurring Charge........................ -- 0.4 -- NM(3) NM(3)
Total Operating Expenses.................. 20.0 20.2 19.7 25.0 21.7
Operating Income.......................... 7.8 7.9 8.8 24.3 40.4
Interest Income (Expense):
Interest and Investment Income.............. 0.1 0.2 0.1 73.8 (32.1)
Interest Expense............................ -- (0.2) (0.1) 160.8 (11.0)
Interest, Net............................. 0.1 -- -- (73.7) (386.2)
Earnings Before Income Taxes.............. 7.9 7.9 8.8 23.7 39.8
Income Taxes.................................. 3.1 3.1 3.5 23.7 40.9
Net Earnings.............................. 4.8% 4.8% 5.3% 23.7% 39.1%
SELECTED CONSOLIDATED SALES DATA
Number of Transactions (000's)................ 464,089 550,226 665,125 18.6% 20.9%
Average Sale Per Transaction.................. $42.09 $43.63 $45.05 3.7 3.3
Weighted Average Weekly Sales Per Operating
Store (000's)............................... $803 $829 $844 3.2 1.8
Weighted Average Sales Per Square Foot........ $398(4) $406 $410 1.8 1.0
</TABLE>
- ------------------------
(1) Fiscal years 1996, 1997 and 1998 refer to the fiscal years ended
February 2, 1997; February 1, 1998; and January 31, 1999, respectively.
(2) Minority interest has been reclassified to selling and store operating
expenses.
(3) Not meaningful.
(4) Adjusted to reflect the first 52 weeks of the 53-week fiscal year in 1996.
FISCAL YEAR ENDED JANUARY 31, 1999 COMPARED TO FEBRUARY 1, 1998
Net sales for fiscal 1998 increased 25.1% to $30.2 billion from
$24.2 billion in fiscal 1997. This increase was attributable to, among other
things, full year sales from the 112 new stores opened during fiscal 1997, a 7%
comparable store-for-store sales increase, and 138 new store openings and 4
store relocations during fiscal 1998. One store opened during fiscal 1998 was
subsequently closed during the year and is planned to reopen during fiscal 1999.
Gross profit as a percent of sales was 28.5% for fiscal 1998 compared to
28.1% for fiscal 1997. The rate increase was primarily attributable to a lower
cost of merchandise resulting from product line reviews and other merchandising
initiatives begun in fiscal 1996 and continued through fiscal 1997 and
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<PAGE>
1998. In addition, sales mix changes, better inventory shrink results and
benefits from import strategies contributed to the overall gross profit
improvement.
Operating expenses as a percent of sales were 19.7% for fiscal 1998 compared
to 20.2% for fiscal 1997. Operating expenses for fiscal 1997 included a
$104 million non-recurring charge related to the settlements of a class action
gender discrimination lawsuit and three other gender discrimination lawsuits.
Excluding the non-recurring charge, operating expenses as a percent of sales
were 19.8% for fiscal 1997.
Selling and store operating expenses as a percent of sales decreased to
17.7% in fiscal 1998 from 17.8% in fiscal 1997. The decrease was primarily
attributable to lower net advertising expenses resulting from higher cooperative
advertising participation by vendors, increased use of national advertising and
leverage achieved from opening stores in existing markets. In addition, improved
claims management and focus on safety programs resulted in lower worker's
compensation and general liability claims experience as a percent of sales.
Also, minority interest decreased from fiscal 1997, mainly due to the purchase
of the remaining 25% of The Home Depot Canada partnership from The Molson
Companies during the first quarter of fiscal 1998. Partially offsetting these
decreases were higher medical costs from increased family enrollment in our
medical plans and higher store selling payroll expenses as a percent of sales.
The increase in store selling payroll expenses was primarily due to increased
sales penetrations in higher margin decor categories, which require more hours
and higher average pay rates to support. Overall productivity, in terms of sales
per labor hour, increased from fiscal 1997.
Pre-opening expenses as a percent of sales were 0.3% for both fiscal 1998
and 1997. We opened 138 new stores and relocated 4 stores in fiscal 1998, and
opened 112 new stores and relocated 5 stores in fiscal 1997. Pre-opening
expenses averaged $618,000 per store in fiscal 1998 compared to $559,000 per
store in fiscal 1997. The higher average expense resulted primarily from our
initial entry into markets such as Chile, Puerto Rico and Alaska, which involve
longer pre-opening periods and higher travel and relocation costs.
General and administrative expenses as a percent of sales were 1.7% for both
fiscal 1998 and 1997. Incremental expenses related to long-term growth and
business planning initiatives incurred in fiscal 1998 were offset by
efficiencies realized from increased sales.
Interest and investment income as a percent of sales decreased to 0.1% in
fiscal 1998 from 0.2% in fiscal 1997 due to lower investment balances and lower
interest rates. Interest expense as a percent of sales was 0.1% in fiscal 1998
compared to 0.2% in fiscal 1997. The decrease from fiscal 1997 was primarily
attributable to economies realized from a 25.1% increase in sales, to lower debt
levels and higher capitalized interest resulting from a higher percentage of
owned stores under construction for fiscal 1998.
Our combined federal and state effective income tax rate was 39.2% for
fiscal 1998 compared to 38.9% for fiscal 1997. The increase was due to a
reduction in tax-exempt interest income as investment balances declined during
the year and to higher effective state tax rates.
Net earnings as a percent of sales were 5.3% for fiscal 1998 compared to
4.8% for fiscal 1997, reflecting a higher gross profit rate, lower selling and
store operating expenses as a percent of sales and the non-recurring charge
recorded in fiscal 1997.
FISCAL YEAR ENDED FEBRUARY 1, 1998 COMPARED TO FEBRUARY 2, 1997
Fiscal 1997 consisted of 52 weeks compared to 53 weeks in fiscal 1996. Net
sales for fiscal 1997 increased 23.7% to $24.2 billion from $19.5 billion in
fiscal 1996. The increase was attributable to, among other things, full year
sales from the 89 new stores opened during fiscal 1996, a 7% comparable 52-week
store-for-store sales increase, and 112 new store openings and 5 store
relocations during fiscal
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<PAGE>
1997. The percentage increase in sales was negatively impacted by one less week
of sales in fiscal 1997 versus fiscal 1996.
Gross profit as a percent of sales was 28.1% for fiscal 1997 compared to
27.8% for fiscal 1996. The rate increase was primarily attributable to a lower
cost of merchandise resulting from product line reviews and other merchandising
initiatives begun in fiscal 1996 and continued through fiscal 1997. In addition,
lower and more stable lumber costs, sales mix changes, and better inventory
shrink results contributed to the gross profit improvement.
Operating expenses as a percent of sales were 20.2% for fiscal 1997 compared
to 20.0% for fiscal 1996. Operating expenses for fiscal 1997 included a
$104 million non-recurring charge related to the settlements of a class action
gender discrimination lawsuit and three other gender discrimination lawsuits.
The non-recurring charge included $65 million for the plaintiff class members,
$22.5 million for the plaintiffs' attorneys and approximately $17 million for
other related internal costs, including implementation or enhancement of certain
human resources programs, as well as the settlement terms of the three other
lawsuits. Excluding the non-recurring charge, operating expenses as a percent of
sales were 19.8% for fiscal 1997.
Selling and store operating expenses as a percent of sales decreased to
17.8% in fiscal 1997 from 18.0% in fiscal 1996. The decrease was primarily
attributable to lower net advertising expenses resulting from higher cooperative
advertising participation by vendors and increased use of national advertising,
as well as lower medical insurance costs primarily due to a higher percentage of
our associates using in-network providers. Partially offsetting these decreases
were higher store payroll expenses as a percent of sales, mainly due to
increased focus on certain higher margin merchandising categories that require
more labor hours to support, such as flooring and other decor areas.
Pre-opening expenses as a percent of sales were 0.3% for both fiscal 1997
and 1996. We opened 112 new stores and relocated 5 stores in fiscal 1997, and
opened 89 new stores and relocated 7 stores in fiscal 1996. Pre-opening expenses
averaged $559,000 per store in fiscal 1997 compared to $570,000 per store in
fiscal 1996.
General and administrative expenses as a percent of sales were 1.7% for both
fiscal 1997 and 1996. Incremental expenses related to long-term growth and
business planning initiatives incurred in fiscal 1997 were partially offset by
efficiencies realized from increased sales.
Interest and investment income as a percent of sales increased to 0.2% in
fiscal 1997 from 0.1% in fiscal 1996 due to a full year of investment income
earned in fiscal 1997 from the proceeds of the issuance of $1.1 billion of our
3 1/4% Convertible Subordinated Notes (the "3 1/4% Notes") in October 1996. See
"--Liquidity and Capital Resources." Interest expense as a percent of sales was
0.2% in fiscal 1997 compared to 0% in fiscal 1996. The increase from the prior
year was primarily attributable to a full year of interest expense on the 3 1/4%
Notes in fiscal 1997, compared to a partial year of interest expense on the
3 1/4% Notes and lower levels of long-term debt prior to issuance of the 3 1/4%
Notes in fiscal 1996.
Our combined federal and state effective income tax rate was 38.9% for both
fiscal 1997 and 1996.
Net earnings as a percent of sales were 4.8% for both fiscal 1997 and 1996,
reflecting a higher gross profit percentage and lower selling and store
operating expenses as a percent of sales, offset by the non-recurring charge
recorded during fiscal 1997, as described above.
LIQUIDITY AND CAPITAL RESOURCES
Cash flow generated from store operations provides Home Depot with a
significant source of liquidity. Additionally, a significant portion of our
inventory is financed under vendor credit terms.
13
<PAGE>
During the first six months of fiscal 1999, we opened 86 stores, relocated
five stores and temporarily closed one store, which will be reopened on the same
site during the third quarter of fiscal 1999. During the remainder of fiscal
1999, we plan to open approximately 83 new stores and relocate one store, for a
unit growth rate of approximately 22% for the year. It is currently anticipated
that approximately 81% of these locations will be owned, and the remainder will
be leased. We also plan to open approximately 200 stores, including relocations,
in fiscal 2000.
During the last three fiscal years, we entered into two operating lease
agreements totaling $882 million for the purpose of financing construction costs
of certain new stores. Under the operating lease agreements, the lessor
purchases the properties, pays for the construction costs and subsequently
leases the facilities to the Company. The leases provide for substantial
residual value guarantees and include purchase options at original substantial
residual value guarantees and include purchase options at original cost on each
property. We financed a portion of our new stores in fiscal 1997, 1998 and 1999
under the operating lease agreements and anticipate utilizing these facilities
to finance selected new stores during the remainder of fiscal 1999 and 2000 and
an office building in fiscal 1999. In addition, some planned locations for
fiscal 1999 will be leased individually, and it is expected that many locations
may be obtained through the acquisition of land parcels and construction or
purchase of buildings.
The cost of new stores to be constructed and owned by Home Depot varies
widely, principally due to land costs, and is currently estimated to average
approximately $13.0 million per location. The cost to remodel and/or fixture
stores to be leased is expected to average approximately $3.9 million per store.
In addition, each new store will require approximately $3.1 million to finance
inventories, net of vendor financing.
During fiscal 1996, we issued, through a public offering, $1.1 billion of
3 1/4% Convertible Subordinated Notes due October 1, 2001. The 3 1/4% Notes were
issued at par and are convertible into shares of Home Depot's common stock at
any time prior to maturity, unless previously redeemed by us, at a conversion
price of $23.0417 per share, subject to adjustment under certain conditions. We
used the net proceeds from the offering to repay outstanding commercial paper
obligations, to finance a portion of our capital expenditure program, including
store expansions and renovations, and for general corporate purposes. We have
elected to redeem the 3 1/4% Notes on November 1, 1999, at a redemption price of
100.813% of the principal amount.
We have a commercial paper program that allows borrowings up to a maximum of
$800 million. As of August 1, 1999, there were no borrowings outstanding under
the program. In connection with the program, we have a back-up credit facility
with a consortium of banks for up to $800 million. The credit facility, which
was refinanced in September 1999 and expires in September 2004, contains various
restrictive covenants, none of which is expected to impact our liquidity or
capital resources.
As of August 1, 1999, we had $520 million in cash and cash equivalents and
short-term investments, as well as $15 million in long-term investments.
Management believes that our current cash position, the proceeds from short-term
and long-term investments, internally generated funds, funds available from its
$800 million commercial paper program, funds available from the $882 million
operating lease agreement, proceeds from this offering and/or the ability to
obtain alternate sources of financing should enable Home Depot to complete its
capital expenditure programs, including store openings and renovations, through
the next several fiscal years.
YEAR 2000
We are currently addressing a universal situation commonly referred to as
the "Year 2000 Problem." The Year 2000 Problem relates to the inability of
certain computer software programs to properly recognize and process
date-sensitive information relative to the year 2000 and beyond. During fiscal
1997, we developed a plan to devote the resources necessary to identify and
modify internal systems impacted by the Year 2000 Problem, or implement new
systems to become year 2000 compliant
14
<PAGE>
in a timely manner. This compliance plan consists of four major areas of focus:
systems, desktops, facilities and supplier management. The total cost of
executing this plan is estimated at $13 million, and as of August 1, 1999, we
had expended approximately $10.1 million to effect the plan.
As of August 1, 1999, we had completed the systems portion of the compliance
plan. In implementing the systems portion of the plan, we completed an inventory
of all software programs operating on our systems, identified year 2000
problems, created an appropriate testing environment, completed testing and
installed year 2000 compliant software in the production environment. All
desktop applications critical to Home Depot's overall business have been
inventoried and evaluated under the method described above, and as of
January 31, 1999, this process was complete. The compliance plan for desktop
infrastructure was complete at the end of the second quarter of fiscal 1999.
Substantially all critical facilities systems, including, but not limited
to, security systems, energy management, material handling, copiers and faxes,
have been inventoried and are being tested. As of August 1, 1999, this process
was approximately 94% complete. We anticipate completing the facilities systems
portion of our compliance plan early during the fourth quarter of fiscal 1999.
We are assessing the year 2000 compliance status of our suppliers, many of
which participate in electronic data interchange ("EDI") or similar programs
with Home Depot. We will conduct substantial testing with EDI merchandise
suppliers and transportation carriers. With respect to merchandise suppliers
participating in EDI programs with Home Depot, we are conducting point-to-point
testing of these EDI systems for year 2000 compliance. We currently anticipate
that we will have completed testing suppliers and carriers representing
approximately 65% of our EDI volume by the end of October 1999.
The risks to Home Depot involved with not solving the Year 2000 Problem
include, but are not limited to, the following: loss of local or regional
electrical power, loss of telecommunication services, delays or cancellations of
merchandise shipments, manufacturing shutdowns, delays in processing customer
transactions, bank errors and computer errors by suppliers. Because our year
2000 compliance is dependent upon certain third parties (including
infrastructure providers) also being year 2000 compliant on a timely basis,
there can be no assurance that our efforts will prevent a material adverse
impact on our results of operations, financial condition or business.
We are modifying our existing disaster recovery plans to include year 2000
contingency planning. Also, we are identifying critical activities that would
normally be conducted during the first two weeks of January 2000, which may be
completed instead in December 1999. We expect our year 2000 contingency planning
to be substantially complete by the end of September 1999 and to test, modify
and test implementation of the contingency plans throughout the remainder of
1999.
CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements we make in this prospectus, and other written and oral
statements made by us or our subsidiaries with the approval of an authorized
executive officer of Home Depot, may constitute "forward-looking statements" as
defined under the Private Securities Litigation Reform Act of 1995. Words or
phrases such as "should result," "are expected to," "we anticipate," "we
estimate," "we project" or similar expressions are intended to identify
forward-looking statements. These statements are subject to certain risks and
uncertainties that could cause actual results to differ materially from our
historical experience and our present expectations or projections. These risks
and uncertainties include, but are not limited to:
- unanticipated weather conditions;
- stability of costs and availability of sourcing channels;
15
<PAGE>
- our ability to attract, train and retain highly-qualified associates;
- conditions affecting the availability, acquisition, development and
ownership of real estate;
- year 2000 problems;
- the impact of competition; and
- regulatory and litigation matters.
Caution should be taken not to place undue reliance on forward-looking
statements, since the statements speak only as of the date they are made. We
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of future events, new information or otherwise.
Additional information concerning the risks and uncertainties listed above and
other factors you may wish to consider are set forth in our Annual Report on
Form 10-K for the fiscal year ended January 31, 1999, and other reports we file
from time to time with the SEC. See "Where You Can Find More Information."
16
<PAGE>
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
We sold the old notes on September 27, 1999 to Credit Suisse First Boston
Corporation and Invemed Associates LLC pursuant to a purchase agreement. These
initial purchasers subsequently sold the old notes to:
- "qualified institutional buyers" ("QIBs"), as defined in Rule 144A under
the Securities Act, in reliance on Rule 144A; and
- persons in offshore transactions in reliance on Regulation S under the
Securities Act.
As a condition to the initial sale of the old notes, Home Depot and the
initial purchasers entered into a registration rights agreement. Pursuant to the
registration rights agreement, we agreed to:
- file with the SEC by December 26, 1999 a registration statement under the
Securities Act with respect to the issuance of the new notes in an
exchange offer; and
- use our commercially reasonable efforts to cause the registration
statement to become effective under the Securities Act on or before
March 25, 2000.
We agreed to issue and exchange the new notes for all old notes validly
tendered and not validly withdrawn prior to the expiration of the exchange
offer. A copy of the registration rights agreement has been filed as an exhibit
to the registration statement which includes this prospectus. The filing of the
registration statement is intended to satisfy some of our obligations under the
registration rights agreement and the purchase agreement.
The term "holder" with respect to the exchange offer means any person in
whose name old notes are registered on the trustee's books or any other person
who has obtained a properly completed bond power from the registered holder, or
any person whose old notes are held of record by The Depository Trust Company
(the "Depositary" or "DTC") who desires to deliver such old note, by book-entry
transfer at DTC.
TERMS OF THE EXCHANGE OFFER
Based on the terms and conditions in this prospectus and in the letter of
transmittal, we will issue $1,000 principal amount of new notes in exchange for
each $1,000 principal amount of outstanding old notes properly surrendered
pursuant to the exchange offer and not withdrawn prior to the expiration date.
Old notes may be surrendered only in integral multiples of $1,000. The form and
terms of the new notes are the same as the form and terms of the old notes
except that
- the new notes will be registered under the Securities Act and, therefore,
the new notes will not bear legends restricting the transfer of the new
notes; and
- holders of the new notes will not be entitled to any of the registration
rights and related liquidated damages of holders of old notes under the
registration rights agreement, which will terminate upon the consummation
of the exchange offer.
The new notes will evidence the same indebtedness as the old notes, which
they replace, and will be issued under, and be entitled to the benefits of, the
same indenture, which authorized the issuance of the old notes. As a result,
both series of notes will be treated as a single class of debt securities under
the indenture.
As of the date of this prospectus, $500 million in aggregate principal
amount of the old notes is outstanding. All of it is registered in the name of
Cede & Co., as nominee for DTC. Solely for reasons of administration, we have
fixed the close of business on as the record date for the exchange
offer for purposes of determining the persons to whom this prospectus and the
letter of
17
<PAGE>
transmittal will be mailed initially. There will be no fixed record date for
determining holders of the old notes entitled to participate in this exchange
offer.
In connection with the exchange offer, neither the General Corporation Law
of the State of Delaware nor the indenture governing the notes gives you any
appraisal or dissenters' rights nor any other right to seek monetary damages in
court. We intend to conduct the exchange offer in accordance with the provisions
of the registration rights agreement and the applicable requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
related SEC rules and regulations.
For all relevant purposes we will be regarded as having accepted properly
surrendered old notes if and when we give oral or written notice of our
acceptance to the exchange agent. The exchange agent will act as agent for the
surrendering holders of old notes for the purposes of receiving the new notes
from us.
If you surrender old notes in the exchange offer, you will not be required
to pay brokerage commissions or fees. In addition, subject to the instructions
in the letter of transmittal, you will not have to pay transfer taxes for the
exchange of old notes. We will pay all charges and expenses, other than certain
applicable taxes described under "--Fees and Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The "expiration date" is 5:00 p.m., New York City time on ,
unless we extend the exchange offer, in which case the expiration date is the
latest date and time to which we extend the exchange offer.
In order to extend the exchange offer, we will
- notify the exchange agent of any extension by oral or written notice and
- issue a press release or other public announcement which would include
disclosure of the approximate number of old notes deposited and which
would be issued prior to 9:00 a.m., New York City time, on the next
business day after the previously scheduled expiration date.
We reserve the right
- to delay accepting any old notes;
- to extend the exchange offer;
- to terminate or amend the exchange offer, and not accept for exchange any
old notes not previously accepted for exchange, upon the occurrence of any
of the events set forth in "--Conditions of the Exchange Offer" by giving
oral or written notice to the exchange agent; or
- to waive any conditions or otherwise amend the exchange offer in any
respect, by giving oral or written notice to the exchange agent.
Any delay in acceptance, extension, termination or amendment will be
followed as soon as practicable by a press release or other public announcement
or post-effective amendment.
If the exchange offer is amended in a manner determined by us to constitute
a material change, we will promptly disclose that amendment by means of a
prospectus supplement or post-effective amendment that will be distributed to
the holders. We will also extend the exchange offer for a period of five to ten
business days, depending upon the significance of the amendment and the manner
of disclosure to the holders, if the exchange offer would otherwise expire
during the five to ten business day period.
18
<PAGE>
We will have no obligation to publish, advertise or otherwise communicate
any public announcement of any delay, extension, amendment or termination that
we may choose to make, other than by making a timely release to an appropriate
news agency.
INTEREST ON THE NEW NOTES
The new notes will accrue cash interest on the same terms as the old notes
at the rate of 6 1/2% per year from September 27, 1999, payable semi-annually in
arrears on September 15 and March 15 of each year, commencing March 15, 2000.
Old notes accepted for exchange will not receive accrued interest thereon at the
time of exchange. However, each new note will bear interest from the most recent
date to which interest has been paid on the old notes, or if no interest has
been paid on the old notes or the new notes, from September 27, 1999.
RESALE OF THE NEW NOTES
We believe that you will be allowed to resell the new notes to the public
without registration under the Securities Act, and without delivering a
prospectus that satisfies the requirements of Section 10 of the Securities Act,
if you can make the three representations set forth above under "Prospectus
Summary--Summary of the Terms of the Exchange Offer--Procedures for
participating in the exchange offer" on page . However, if you intend to
participate in a distribution of the new notes, you must comply with the
registration requirements of the Securities Act and deliver a prospectus, unless
an exemption from registration is otherwise available. In addition, you will be
subject to additional restrictions if you are an "affiliate" of Home Depot as
defined under Rule 405 of the Securities Act. You will be required to represent
to Home Depot in the letter of transmittal accompanying this prospectus that you
meet these conditions exempting you from the registration requirements.
Our belief is based on interpretations of the SEC for other exchange offers
that the SEC expressed in some of the SEC's in no-action letters to other
issuers in exchange offers like ours. However, we have not asked the SEC to
consider this particular exchange offer in the context of a no-action letter.
Therefore, you cannot be certain that the SEC will treat it in the same way it
has treated other exchange offers in the past.
A broker-dealer that has bought old notes for market-making or other trading
activities has to deliver a prospectus in order to resell any new notes it has
received for its own account in the exchange. This prospectus may be used by a
broker-dealer to resell any of its exchange notes. We have agreed in the
registration rights agreement to send this prospectus to any broker-dealer that
requests copies in the letter of transmittal for a period of up to 135 days
after the registration statement relating to this exchange offer is declared
effective. See "Plan of Distribution" for more information regarding
broker-dealers.
PROCEDURES FOR TENDERING
If you wish to surrender old notes you must
- complete, sign and date the letter of transmittal, or a facsimile thereof,
- have the signatures guaranteed if required by the letter of transmittal
and
- mail or deliver the letter of transmittal or the facsimile to the exchange
agent at the address appearing below under "--Exchange Agent" for receipt
prior to the expiration date.
In addition, either
- certificates for such old notes must be received by the exchange agent
along with the letter of transmittal,
19
<PAGE>
- a timely confirmation of a book-entry transfer of the old notes into the
exchange agent's account at DTC, pursuant to the procedure for book-entry
transfer described below, must be received by the exchange agent prior to
the expiration date or
- you must comply with the procedures described below under "--Guaranteed
Delivery Procedures."
THE METHOD OF DELIVERY TO THE EXCHANGE AGENT OF OLD NOTES, THE LETTER OF
TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT YOUR ELECTION AND RISK.
INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT YOU USE AN OVERNIGHT OR HAND
DELIVERY SERVICE, PROPERLY INSURED. IN ALL CASES, YOU SHOULD ALLOW SUFFICIENT
TIME TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. DO NOT
SEND THE LETTER OF TRANSMITTAL OR ANY OLD NOTES TO US. YOU MAY REQUEST THAT YOUR
BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR NOMINEE PERFORM THESE
TRANSACTIONS FOR YOU.
If you do not withdraw your surrender of old notes prior to the expiration
date, you will be regarded as agreeing to surrender the new notes in accordance
with the terms and conditions in this offer.
If you are a beneficial owner of the old notes and your old notes are held
through a broker, dealer, commercial bank, trust company or other nominee and
you want to surrender your old notes, you should contact your intermediary
promptly and instruct it to surrender the old notes on your behalf.
Signatures on a letter of transmittal or a notice of withdrawal described
below under "--Withdrawal of Tenders," as the case may be, must generally be
guaranteed by an eligible institution. You can submit a letter of transmittal
without guarantee if you surrender your old notes (a) as a registered holder and
you have not completed the box titled "Special Delivery Instruction" on the
letter of transmittal or (b) for the account of an eligible institution. In the
event that signatures on a letter of transmittal or a notice of withdrawal are
required to be guaranteed, the guarantee must be made by
- a member firm of a registered national securities exchange or of the
National Association of Securities Dealers;
- a commercial bank or trust company having an office or correspondent in
the United States; or
- an "eligible guarantor institution" within the meaning of Rule 17Ad-15
under the Exchange Act which is a member of one of the recognized
signature guarantee programs identified in the letter of transmittal.
If you sign the letter of transmittal even though you are not the registered
holder of any old notes listed in the letter of transmittal, your notes must be
endorsed or accompanied by a properly completed bond power, signed by the
registered holder exactly as the registered holder's name appears on the old
notes.
In connection with any surrender of old notes in definitive certificated
form, if you sign the letter of transmittal or any old notes or bond powers in
your capacity as trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or if you are otherwise acting in a fiduciary or
representative capacity, you should indicate this when signing. Unless waived by
us, you must submit with the letter of transmittal evidence satisfactory to us
of your authority to act in the particular capacity.
The exchange agent and DTC have confirmed that any financial institution
that is a participant in DTC's system may utilize DTC's automated tender offer
program to surrender old notes.
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All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of surrendered old notes will be determined
by us in our sole discretion, which will be final and binding.
We reserve the absolute right to reject any and all old notes not properly
surrendered. Nor will we accept any old notes if our acceptance of them would,
in the opinion of our counsel, be unlawful. We also reserve the right to waive
any defects, irregularities or conditions of surrender as to particular old
notes.
Unless waived, you must cure any defects or irregularities in connection
with surrenders of old notes within the time period we will determine. Although
we intend to notify holders of defects or irregularities in connection with
surrenders of old notes, neither we, the exchange agent nor anyone else will be
liable for failure to give such notice. Surrenders of old notes will not be
deemed to have been made until any defects or irregularities have been cured or
waived.
We do not currently intend to acquire any old notes that are not surrendered
in the exchange offer or to file a registration statement to permit resales of
any old notes that are not surrendered pursuant to the exchange offer. We
reserve the right in our sole discretion to purchase or make offers for any old
notes that remain outstanding after the expiration date. To the extent permitted
by law, we also reserve the right to purchase old notes in the open market, in
privately negotiated transactions or otherwise. The terms of any future
purchases or offers could differ from the terms of the exchange offer.
By surrendering old notes pursuant to the exchange offer, you will be
telling us that, among other things,
- you have full power and authority to surrender, sell, assign and transfer
the old notes surrendered;
- we will acquire good title to the old notes being surrendered, free and
clear of all security interests, liens, restrictions, charges,
encumbrances, conditional sale agreements or other obligations relating to
their sale or transfer, and not subject to any adverse claim when the old
notes are accepted by us;
- you are acquiring the new notes in the ordinary course of your business;
- you have no arrangement or understanding with any person to participate in
the distribution of the new notes;
- you acknowledge and agree that if you are a broker-dealer registered under
the Exchange Act or you are participating in the exchange offer for the
purpose of distributing the new notes, you must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with a secondary resale of the new notes, and you understand
that you cannot rely on the position of the SEC's staff in their no-action
letters;
- you understand that a secondary resale transaction described above and any
resales of new notes obtained by you in exchange for old notes acquired by
you directly from us should be covered by an effective registration
statement containing the selling security holder information required by
Item 507 or Item 508 of Regulation S-K of the SEC; and
- you are not an "affiliate," as defined in Rule 405 under the Securities
Act, of Home Depot.
If you are a broker-dealer and you will receive new notes for your own
account in exchange for old notes that were acquired as a result of
market-making activities or other trading activities, you must acknowledge in
the letter of transmittal that you will deliver a prospectus in connection with
any resale of such new notes. See "Plan of Distribution."
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RETURN OF OLD NOTES
If any surrendered old notes are not accepted for any reason described in
this prospectus or if old notes are withdrawn or are submitted for a greater
principal amount than you desire to exchange, those old notes will be returned
without expense to (a) the person who surrendered them or (b) in the case of old
notes surrendered by book-entry transfer into the exchange agent's account at
DTC. The old notes will be credited to an account maintained with DTC as
promptly as practicable.
BOOK-ENTRY TRANSFER
The exchange agent will make a request to establish an account with respect
to the old notes at DTC for purposes of the exchange offer within two business
days after the date of this prospectus. Any financial institution that is a
participant in DTC's systems may make book-entry delivery of old notes by
causing DTC to transfer the old notes into the exchange agent's account at DTC
in accordance with DTC's procedures for transfer. However, although delivery of
old notes may be effected through book-entry transfer at DTC, you have to
transmit the letter of transmittal with any required signature guarantees and
any other required documents to the exchange agent at the address appearing
below under "--Exchange Agent" for its receipt on or prior to the expiration
date or pursuant to the guaranteed delivery procedures described below.
GUARANTEED DELIVERY PROCEDURES
If you wish to surrender your old notes and (a) your old notes are not
readily available so you can meet the expiration date deadline or (b) you cannot
deliver your old notes, the letter of transmittal or any other required
documents to the exchange agent prior to the expiration date, you may still
participate in the exchange offer if
- the surrender is made through an eligible institution;
- prior to the expiration date, the exchange agent receives from such
eligible institution a properly completed and duly executed notice of
guaranteed delivery substantially in the form provided by us, by facsimile
transmission, mail or hand delivery, containing the name and address of
the holder, the certificate number(s) of the old notes, if applicable, and
the principal amount of old notes surrendered. The notice of guaranteed
delivery must also state that the surrender is being made thereby and
guarantee that, within five New York Stock Exchange trading days after the
expiration date, the letter of transmittal, together with the
certificate(s) representing the old notes in proper form for transfer or a
book-entry confirmation, and any other required documents, will be
deposited by the eligible institution with the exchange agent; and
- the properly executed letter of transmittal, as well as the certificate(s)
representing all surrendered old notes in proper form for transfer or a
book-entry confirmation, and all other documents required by the letter of
transmittal are received by the exchange agent within five New York Stock
Exchange trading days after the expiration date.
The exchange agent will send you a notice of guaranteed delivery upon your
request if you wish to surrender your old notes according to the guaranteed
delivery procedures set forth above.
WITHDRAWAL OF TENDERS
Except as otherwise provided in this prospectus, you may withdraw your
surrender of old notes at any time prior to the expiration date.
To withdraw a surrender of old notes in the exchange offer, the exchange
agent must receive a written or facsimile transmission notice of withdrawal at
its address set forth herein prior to the expiration date. Any notice of
withdrawal must
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- specify the name of the person having deposited the old notes to be
withdrawn;
- identify the old notes to be withdrawn, including the certificate number
or numbers, if applicable, and principal amount of the old notes; and
- be signed by the holder in the same manner as the original signature on
the letter of transmittal by which the old notes were tendered.
All questions as to the validity, form, eligibility and time of receipt of
notices will be determined by us, in our sole discretion, and our determination
shall be final and binding on all parties. Any old notes so withdrawn will be
deemed not to have been validly surrendered for purposes of the exchange offer,
and no new notes will be issued unless the old notes so withdrawn are validly
retendered. Properly withdrawn old notes may be resurrendered by following one
of the procedures described above under "--Procedures for Tendering" at any time
prior to the expiration date.
CONDITIONS OF THE EXCHANGE OFFER
Notwithstanding any other term of the exchange offer, or any extension of
the exchange offer, we do not have to accept for exchange, or exchange new notes
for, any old notes, and we may terminate the exchange offer before acceptance of
the old notes, if:
- any statute, rule or regulation has been enacted, or any action has been
taken by any court or governmental authority that, in our reasonable
judgement, seeks to or would prohibit, restrict or otherwise render
consummation of the exchange offer illegal; or
- any change, or any development that would cause a change, in our business
or financial affairs has occurred that, in our sole judgment, might
materially impair our ability to proceed with the exchange offer or a
change that would materially impair the contemplated benefits to us of the
exchange offer; or
- a change occurs in the current interpretations by the staff of the SEC
that, in our reasonable judgement, might materially impair our ability to
proceed with the exchange offer.
If we, in our sole discretion, determine that any of the above conditions is not
satisfied, we may:
- refuse to accept any old notes and return all surrendered old note to the
surrendering holders;
- extend the exchange offer and retain all old notes surrendered prior to
the expiration date, subject to the holders' right to withdraw the
surrender of the old notes; or
- waive any unsatisfied conditions regarding the exchange offer and accept
all properly surrendered old notes that have not been withdrawn. If this
waiver constitutes a material change to the exchange offer, we will
promptly disclose the waiver by means of a prospectus supplement or
post-effective amendment that will be distributed to the holders. We will
also extend the exchange offer for a period of five to ten business days,
depending upon the significance of the waiver and the manner of disclosure
to the holders, if the exchange offer would otherwise expire during the
five to ten business day period.
EXCHANGE AGENT
The Bank of New York is the exchange agent for the exchange offer. You
should direct any questions and requests for assistance, requests for additional
copies of this prospectus or of the letter of transmittal and requests for
notice of guaranteed delivery to the exchange agent, addressed as follows:
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BY REGISTERED OR CERTIFIED MAIL:
The Bank of New York
101 Barclay Street, 7 E
New York, New York 10286
Attention: [ ]
Reorganization Section
TO CONFIRM BY TELEPHONE:
(212) 815- [ ]
FACSIMILE TRANSMISSIONS (ELIGIBLE INSTITUTIONS ONLY):
(212) 815-6339
BY HAND OR OVERNIGHT DELIVERY
The Bank of New York
101 Barclay Street
Corporate Trust Services Window
Ground Level
New York, New York 10286
Attention: [ ]
Reorganization Section
The Bank of New York also serves as trustee under the indenture.
FEES AND EXPENSES
We will pay for the expenses of the exchange offer. The principal
solicitation is being made by mail. However, additional solicitation may be made
by telegraph, facsimile transmission, e-mail, telephone or in person by our
officers and regular employees.
We have not retained a dealer-manager for the exchange offer, and will not
make any payments to brokers, dealers or others soliciting acceptances of the
exchange offer. We will, however, pay the exchange agent reasonable and
customary fees and out-of-pocket expenses.
We will pay any transfer taxes applicable to the exchange of old notes. If,
however, a transfer tax is imposed for any reason other than the exchange, then
the amount of any transfer taxes will be payable by the person surrendering the
notes. If you do not submit satisfactory evidence of payment of taxes or of an
exemption with the letter of transmittal, the amount of those transfer taxes
will be billed directly to you.
CONSEQUENCE OF FAILURE TO EXCHANGE
Participation in the exchange offer is voluntary. You are urged to consult
your financial and tax advisors in making your decisions on what action to take.
Old notes that are not exchanged will remain "restricted securities" within
the meaning of Rule 144(a)(3)(iv) of the Securities Act. Accordingly, they may
not be offered, sold, pledged or otherwise transferred except
- 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 or for the account of a qualified
institutional buyer in a transaction meeting the requirements of
Rule 144A;
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- in an offshore transaction complying with Rule 903 or Rule 904 of
Regulation S under the Securities Act;
- pursuant to an exemption from registration under the Securities Act
provided by Rule 144, if available;
- pursuant to an effective registration statement under the Securities Act;
or
- pursuant to another available exemption from the registration requirements
of the Securities Act, and in accordance with all other applicable
securities laws.
ACCOUNTING TREATMENT
For accounting purposes, we will recognize no gain or loss as a result of
the exchange offer. The expenses of the exchange offer will be amortized over
the remaining term of the notes.
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DESCRIPTION OF THE NEW NOTES
The form and terms of the new notes and the old notes are identical in all
material respects, except that transfer restrictions and registration rights and
related liquidated damages provisions applicable to the old notes do not apply
to the new notes.
The old notes were, and the new notes will be, issued under an Indenture,
dated as of September 27, 1999, between Home Depot and The Bank of New York, as
Trustee. The following discussion includes a summary description of certain
material terms of the Indenture and the Registration Rights Agreement, dated as
of September 27, 1999, between Home Depot and the initial purchasers. Because
this is a summary, it does not include all of the information that is included
in the Indenture or the Registration Rights Agreement, including the definitions
of certain terms used below. You should read the Indenture and the Registration
Rights Agreement carefully and in their entirety. You may request copies of
these documents from Home Depot, as described under "Where You Can Find More
Information."
GENERAL
The notes are senior unsecured obligations of Home Depot. The notes will be
limited to $500,000,000 aggregate principal amount. The notes will mature on
September 15, 2004. The notes will bear interest at 6 1/2% per annum from
September 27, 1999. Home Depot will pay interest semiannually on September 15
and March 15 of each year commencing March 15, 2000, to the person in whose name
such notes (or any predecessor note) is registered at the close of business on
the September 1 or March 1, respectively, preceding such interest payment date.
Interest on the notes will be calculated on the basis of a 360-day year
consisting of 12 months of 30 days each.
Principal of and premium, if any, and interest on the notes are payable, and
the notes are exchangeable and transfers thereof are registrable, at an office
or agency of Home Depot, one of which is maintained for such purpose in New
York, New York (which initially will be the corporate trust office of the
Trustee) or such other office or agency permitted under the Indenture.
Home Depot does not intend to list the notes on a national securities
exchange.
The Indenture does not contain any provisions that would limit the ability
of Home Depot to incur indebtedness or require the maintenance of financial
ratios or specified levels of net worth or liquidity. However, the Indenture
does:
- provide that, subject to certain exceptions described under "--Certain
Covenants--Limitations on Liens," neither Home Depot nor any Subsidiary
will subject its property or assets to any mortgage or other encumbrance
unless the Notes are secured equally and ratably with such other
indebtedness thereby secured; and
- contain certain limitations on the ability of Home Depot and its
Subsidiaries to enter into certain sale and leaseback arrangements.
In addition, the Indenture does not contain any provisions that would
require Home Depot to repurchase or redeem or otherwise modify the terms of any
of the notes upon a change in control or other events involving Home Depot that
may adversely affect its creditworthiness. See "--Certain Covenants."
REDEMPTION
Home Depot, at its option, may at any time redeem all or any portion of
notes on not less than 30 nor more than 60 days' prior notice mailed to the
holders of the notes to be redeemed. The notes are redeemable at a redemption
price, plus accrued interest to the date of redemption, equal to the greater of
(1) 100% of the Principal Amount of the notes to be redeemed and (2) the sum of
the present values of the remaining scheduled payments of principal and interest
on the notes to be redeemed that
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would be due after the related redemption date but for such redemption (except
that, if such redemption date is not an interest payment date, the amount of the
next succeeding scheduled interest payment will be reduced by the amount of
interest accrued thereon to the redemption date), discounted to the redemption
date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day
months) at the Treasury Rate plus 10 basis points.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity (computed as of the
second business day immediately preceding such redemption date) 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.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker 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 the notes. "Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by Home Depot.
"Comparable Treasury Price" means, with respect to any redemption date,
(1) the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Notes" or (2) if such release (or any successor release) is not
published or does not contain such prices on such business day, (a) the average
of the Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest of such Reference Treasury Dealer Quotations,
or (b) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all Quotations obtained.
"Reference Treasury Dealer" means Credit Suisse First Boston Corporation and
its successors and two other nationally recognized investment banking firms that
are Primary Treasury Dealers specified from time to time by Home Depot, except
that if any of the foregoing ceases to be a primary U.S. Government securities
dealer in New York City (a "Primary Treasury Dealer"), Home Depot is required to
designate as a substitute another nationally recognized investment banking firm
that is a Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Trustee, 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 as of 3:30 p.m., New
York City time, on the third business day preceding such redemption date.
On and after any redemption date, interest will cease to accrue on the notes
called for redemption. Prior to any redemption date, Home Depot is required to
deposit with a paying agent money sufficient to pay the redemption price of and
accrued interest on the notes to be redeemed on such date. If Home Depot is
redeeming less than all the notes, the Trustee must select the notes to be
redeemed by such method as the Trustee deems fair and appropriate in accordance
with methods generally used at the time of selection by fiduciaries in similar
circumstances.
BOOK-ENTRY SYSTEM
Home Depot will initially issue the new notes in the form of one or more
global securities (the "Global Notes"). The Global Notes will be deposited with,
or on behalf of, The Depository Trust Company (the "Depository") and registered
in the name of the Depository or its nominee. Except as set forth below, the
Global Notes may be transferred, in whole but not in part, only to the
Depository or another nominee of the Depository. You may hold your beneficial
interests in the Global Notes
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directly through the Depository if you have an account with the Depository or
indirectly through organizations which have accounts with the Depository.
The Depository has advised Home Depot that the Depository is a
limited-purpose trust company organized under the Banking Law of the State of
New York, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. The Depository was created to hold the securities of institutions that have
accounts with the Depository ("participants") and to facilitate the clearance
and settlement of securities transactions among its participants in such
securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of securities
certificates. The Depository's participants include securities brokers and
dealers (which may include the initial purchasers), banks, trust companies,
clearing corporations and certain other organizations. Access to the
Depository's book-entry system is also available to others, such as banks,
brokers, dealers and trust companies (collectively, the "indirect participants")
that clear through or maintain a custodial relationship with a participant,
either directly or indirectly.
Home Depot expects that pursuant to procedures established by the
Depository, upon the deposit of the Global Notes with the Depository, the
Depository will credit, on its book-entry registration and transfer system, the
principal amount of Notes represented by such Global Notes to the accounts of
participants. Ownership of beneficial interest in the Global Notes will be
limited to participants or persons that may hold interests through participants.
Ownership of beneficial interests in the Global Notes will be shown on, and the
transfer of those ownership interests will be effected only through, records
maintained by the Depository (with respect to participants' interest), the
participants and the indirect participants (with respect to the owners of
beneficial interests in the Global Notes other than participants). The laws of
some jurisdictions may require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such limits and laws
may impair your ability to transfer or pledge beneficial interests in the Global
Notes.
So long as the Depository, or its nominee, is the registered holder and
owner of the Global Notes, the Depository or such nominee, as the case may be,
will be considered the sole legal owner and holder of any related notes
evidenced by the Global Notes for all purposes of such notes and the Indenture.
Except as set forth below, as an owner of a beneficial interest in the Global
Notes, you will not be entitled to have the Notes represented by the Global
Notes registered in your name, will not receive or be entitled to receive
physical delivery of certificated Notes and will not be considered to be the
owner or holder of any Notes represented by the Global Notes. Accordingly, each
person owning a beneficial interest in the Global Notes must rely on the
procedures of the Depository and, if such person is not a participant in the
book-entry registration and transfer system of the Depository, on the procedures
of the participant through which such person owns its interest, to exercise any
rights of an owner or holder of the Notes under the Indenture.
Home Depot understands that, under existing industry practice, if an owner
of a beneficial interest in Global Notes desires to give any notice or take any
action that the Depository, as the owner or holder of the Global Notes, is
entitled to give or take, the Depository would authorize the participants to
give such notice or take such action and the participants would authorize
beneficial owners owning through such participants to give such notice or take
such action or would otherwise act upon the instructions of beneficial owners
owning through them.
Home Depot will make payments of principal of, premium, if any, and interest
on notes represented by the Global Notes registered in the name of and held by
the Depository or its nominee to the Depository or its nominee, as the case may
be, as the registered owner and holder of the Global Notes.
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Home Depot expects that the Depository or its nominee, upon receipt of any
payment of principal of, premium, if any, or interest on the Global Notes will
credit participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of the Global Notes as
shown on the records of the Depository or its nominee. Home Depot also expects
that payments by participants or indirect participants to owners of beneficial
interests in the Global Notes held through such participants or indirect
participants will be governed by standing instructions and customary practices
and will be the responsibility of such participants or indirect participants.
None of Home Depot, the Trustee, the registrar or any paying agent for the Notes
will have any responsibility or liability for any aspect of the records relating
to, or payments made on account of, beneficial ownership interests in Global
Notes for any Notes or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests or for any other aspect of the
relationship between the Depository and its participants or indirect
participants and the owners of beneficial interests in the Global Notes owning
through such participants.
Although the Depository has agreed to the foregoing procedures in order to
facilitate transfers of interests in the Global Notes among participants of the
Depository, it is under no obligation to perform such procedures, and such
procedures may be discontinued at any time. None of Home Depot, the Trustee, the
registrar or any paying agent for the Notes will have any responsibility or
liability for the performance by the Depository or its participants or indirect
participants of their respective obligations under the rules and procedures
governing their operations.
CERTIFICATED NOTES
The new notes represented by the Global Notes are exchangeable for
certificated new notes in definitive form of like tenor in denominations of
$1,000 and integral multiples thereof if:
(1) the Depository notifies Home Depot that it is unwilling or unable to
continue as Depository for the Global Notes or if at any time the
Depository ceases to be a clearing agency registered under the
Exchange Act and a successor Depository is not appointed by Home
Depot, in either case, within 90 days;
(2) Home Depot in its discretion at any time determines not to have all
of the Notes represented by the Global Notes; or
(3) an Event of Default has occurred and is continuing.
Any new note that is exchangeable pursuant to the preceding sentence is
exchangeable for certificated Notes issuable in authorized denominations of
$1,000 and integral multiples thereof and registered in such names as the
Depository shall direct. Subject to the foregoing, the Global Notes are not
exchangeable, except for Global Notes of the same aggregate denomination to be
registered in the name of the Depository or its nominee.
None of Home Depot, the Trustee, the registrar or any paying agent for the
notes will be liable for any delay by the Depository or any participant in
identifying the beneficial owners of the related notes and each such person may
conclusively rely on, and will be protected in relying on, instructions from the
Depository for all purposes (including with respect to the registration and
delivery, and the respective principal amounts, of the notes to be issued).
PAYMENT
The Indenture will require Home Depot to make payments in respect of notes
(including principal, premium, if any, and interest) at the office or agency of
Home Depot maintained for that purpose or, at Home Depot's option, by mailing a
check to such holder's registered address.
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CERTAIN COVENANTS
LIMITATIONS ON LIENS. The Indenture provides that the Company may not, nor
may it permit any Subsidiary to, issue, assume or guarantee any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed
("indebtedness") which are secured by any mortgage, security interest, pledge or
lien ("mortgage") of or upon any Principal Property, or of or upon any shares of
capital stock or evidences of indebtedness of any Subsidiary that owns any
Principal Property, whether such Principal Property, shares of capital stock or
evidences of indebtedness were owned at the date of the Indenture or thereafter
acquired, without effectively providing that the Principal Amount of the notes
from time to time outstanding shall be secured equally and ratably with (or at
the option of the Company, prior to) such mortgage, except that this restriction
does not apply to:
(1) mortgages existing on the date of the Indenture;
(2) mortgages on any property existing at the time of its acquisition;
(3) mortgages on property, shares of capital stock or evidences of
indebtedness of a corporation existing at the time such corporation
is merged into or consolidated with, or disposes of substantially all
its properties (or those of a division) to, the Company or a
Subsidiary;
(4) mortgages on property, shares of capital stock or evidences of
indebtedness of any corporation existing at the time such corporation
first becomes a Subsidiary;
(5) mortgages securing indebtedness of a Subsidiary to the Company or to
another Subsidiary;
(6) mortgages to secure the cost of acquisition, construction,
development or substantial repair, alteration or improvement of
property if the commitment to extend the credit secured by any such
mortgage is obtained within 60 months after the later of the
completion or the placing in operation of the acquired, constructed,
developed or substantially repaired, altered or improved property;
(7) mortgages securing current liabilities;
(8) any extension, renewal or replacement (or successive extensions,
renewals or replacements), in whole or in part, of any mortgage
referred to in clauses (1) through (7), provided, however, that the
principal amount of indebtedness secured thereby and not otherwise
authorized by said clauses (1) to (7), inclusive, shall not exceed
the principal amount of indebtedness, plus any premium or fee payable
in connection with any such extension, renewal or replacement, so
secured at the time of such extension, renewal or replacement;
(9) mortgages in favor of the United States or any State thereof, or any
department, agency or instrumentality or political subdivision of the
United States or any State thereof, to secure partial progress,
advance or other payments pursuant to any contract or statute or to
secure any indebtedness incurred for the purpose of financing all or
any part of the purchase price or the cost of constructing or
improving the property subject to such mortgages;
(10) mortgages arising out of a final judgment for the payment of money
aggregating not in excess of $10,000,000 or mortgages related to any
legal proceeding being contested in good faith by appropriate
proceedings, provided that the enforcement of any mortgage has been
stayed; or
(11) mortgages for taxes or other governmental charges either not yet
delinquent or the nonpayment of which is being contested in good
faith by appropriate proceedings; mortgages comprising landlord's
liens or liens of carriers, warehousemen, mechanics or
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materialmen incurred in the ordinary course of business for sums not
yet due and payable or which are being contested in good faith by
appropriate proceedings; and any other mortgages incurred or created
in the ordinary course of business not arising in connection with
indebtedness that do not materially impair the use or value of the
assets of the Company and its Subsidiaries, taken as a whole.
The Company or any Subsidiary may, however, issue, assume or guarantee
indebtedness secured by mortgages which would otherwise be subject to the
foregoing restriction in an aggregate amount which, together with all other such
indebtedness outstanding and all Attributable Debt outstanding under the
provisions described in the last sentence under "--Limitations on Sale and
Lease-Back Transactions" below does not at the time exceed the greater of 10.0%
of all Consolidated Net Tangible Assets or 15.0% of Consolidated Capitalization.
LIMITATIONS ON SALE AND LEASE-BACK TRANSACTIONS. The Indenture provides
that neither the Company nor any Subsidiary may enter into any Sale and
Lease-Back Transaction with respect to any Principal Property (except for
transactions involving leases for a term, including renewals, of not more than
48 months and except for transactions between the Company and a Subsidiary or
between Subsidiaries). This restriction does not apply if either
(1) the Company or such Subsidiary would be entitled pursuant to the
provisions described in the first sentence under "--Limitations on
Liens" above to issue, assume or guarantee evidences of indebtedness
secured by a mortgage on such Principal Property in an amount at
least equal to the Attributable Debt in respect of such Sale and
Lease-Back Transaction without being required under the provisions
described under "--Limitation on Liens" to equally and ratably secure
the Notes from time to time outstanding; or
(2) the Company applies within one year an amount equal to, in the case
of a sale or transfer for cash, the net proceeds (not exceeding the
net book value) and, otherwise, an amount equal to the fair value (as
determined by its Board of Directors) of the Principal Property so
leased (a) to the retirement of the Notes or other Senior Funded
Indebtedness of the Company or a Subsidiary, subject to reduction as
set forth in the Indenture in respect of the Notes and other Senior
Funded Indebtedness retired during such one-year period otherwise
than pursuant to mandatory sinking fund or prepayment provisions and
payments at maturity or (b) to the purchase of a Principal Property
or Principal Properties (other than the Principal Property involved
in such sale or transfer).
The Company or any Subsidiary may, however, enter into a Sale and Lease-Back
Transaction which would otherwise be subject to the foregoing restriction so as
to create an aggregate amount of Attributable Debt which, together with all
other such Attributable Debt outstanding and all indebtedness outstanding under
the provisions described in the last sentence under "--Limitations on Liens"
above, does not exceed 15.0% of Consolidated Capitalization.
WAIVER OF COVENANTS. The Indenture provides that Holders of a majority in
Principal Amount of the outstanding notes may waive compliance with certain
covenants or conditions set forth in the Indenture.
CONSOLIDATION, MERGER OR SALE OF ASSETS OF THE COMPANY. The Indenture
provides that the Company may not consolidate with or merge into any other
Person or sell its assets substantially as an entirety, unless:
(1) the Person formed by such consolidation or into which the Company is
merged or the Person which acquires its assets is a Person organized
in the United States and expressly assumes the due and punctual
payment of the principal of and interest on the notes and the
performance of every covenant of the Indenture on the part of the
Company; and
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(2) 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.
Upon such consolidation, merger or sale, the successor corporation formed by
such consolidation or into which the Company is merged or to which such sale is
made will succeed to, and be substituted for, the Company under the Indenture,
and the predecessor corporation shall be released from all obligations and
covenants under the Indenture and the notes.
The Indenture does not restrict, or require the Company to redeem or permit
Holders to cause a redemption of notes in the event of:
(1) a consolidation, merger, sale of assets or other similar transaction
that may adversely affect the creditworthiness of the Company or the
successor or combined entity;
(2) a change in control of the Company; or
(3) a highly leveraged transaction involving the Company whether or not
involving a change in control.
Accordingly, the holders of the notes would not have protection in the event
of a highly leveraged transaction, reorganization, restructuring, merger or
similar transaction involving the Company that may adversely affect the holders
of the notes. The existing protective covenants applicable to the notes would
continue to apply to the Company in the event of a leveraged buyout initiated or
supported by the Company, the management of the Company, or an affiliate of the
Company or its management, but may not prevent such a transaction from taking
place.
EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that if an Event of Default shall have occurred and
be continuing, then either the Trustee or the Holders of not less than 25% in
outstanding Principal Amount of the notes within ten days after notice to the
Company may declare to be due and payable immediately the Principal Amount of
the notes, together with interest, if any, accrued thereon.
Under the Indenture, an Event of Default with respect to the notes is any
one of the following events:
(1) default for 30 days in payment of any interest due with respect to
any note;
(2) default in payment of principal of or premium, if any, on any note;
(3) default for 90 days after written notice to the Company by the
Trustee or by Holders of not less than 25% in Principal Amount of the
notes then outstanding in the performance of any covenant or other
agreement in the Indenture or the notes for the benefit of the notes;
(4) indebtedness for borrowed money of the Company or any Subsidiary is
accelerated by the holders thereof because of a default and the total
amount of such indebtedness accelerated exceeds $50,000,000, and such
indebtedness is not discharged or such acceleration is not cured,
waived, annulled or rescinded within ten days after notice to the
Company by the Trustee or by Holders of not less than 25% in
Principal Amount of the notes then outstanding; and
(5) certain events of bankruptcy, insolvency and reorganization.
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default with respect to the notes, give to the Holders notice of
such default known to it, unless cured or waived; provided that, except in the
case of default in the payment of principal, premium, if any, or interest, if
any, the Trustee will be protected in withholding such notice if it in good
faith determines that the withholding of such notice is in the interests of the
Holders. The term "default" for the purpose of this provision means any event
which is, or after notice or lapse of time, or both, would become, an Event of
Default.
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The Indenture contains a provision entitling the Trustee, subject to the
duty of the Trustee during the continuance of an Event of Default to act with
the required standard of care, to be indemnified by the Holders before
proceeding to exercise any right or power under the Indenture at the request of
such Holders. The Indenture provides that the Holders of a majority in
outstanding Principal Amount of the notes may, subject to certain exceptions, on
behalf of the Holders direct the time, method and place of conducting
proceedings for remedies available to the Trustee, or exercising any trust or
power conferred on the Trustee.
The Indenture includes a covenant that the Company will file annually with
the Trustee a certificate of no default, or specifying any default that exists.
In certain cases, the Holders of a majority in outstanding Principal Amount
of the notes may on behalf of the Holders rescind a declaration of acceleration
or waive any past default or Event of Default, except a default not theretofore
cured in payment of the principal, premium, if any, of or interest, if any, on
the notes or in respect of a provision which under the Indenture cannot be
modified or amended without the consent of the Holder of each note.
No Holder of a note will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder unless:
(1) such Holder shall have previously given to the Trustee written notice
of a continuing Event of Default;
(2) the Holders of at least 25% in aggregate Principal Amount of the
outstanding notes have also made such a written request;
(3) such Holder or Holders have offered reasonable indemnity to the
Trustee to institute such proceeding as trustee;
(4) the Trustee has not received from the Holders of a majority in
outstanding Principal Amount of the notes a direction inconsistent
with such request; and
(5) the Trustee has failed to institute such proceeding within 90
calendar days of such notice.
However, such limitations do not apply to a suit instituted by a holder of
notes for enforcement of payment of the principal of and interest on such notes
on or after the respective due dates expressed in such notes.
MODIFICATION AND WAIVER
Except as described below, modifications and amendments of the Indenture may
be made by Home Depot and the Trustee with the consent of the Holders of a
majority in outstanding Principal Amount of the notes. However, no such
modification or amendment may, without the consent of the Holder of each note:
- change the stated maturity of, or time for payment of interest on, the
notes;
- reduce the Principal Amount of, the rate of interest on, or the premium,
if any, payable upon the redemption of, the notes;
- change the place or currency of payment of principal of, or premium, if
any, or interest on, the notes;
- impair the right to institute suit for the enforcement of any payment on
or with respect to the notes on or after the stated maturity or prepayment
date thereof; or
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- reduce the percentage in principal amount of the notes, the consent of the
Holders of which is required for modification or amendment of the
Indenture or for waiver of compliance with certain provisions of the
Indenture or for waiver of certain defaults.
The Holders of a majority in outstanding Principal Amount of the notes may
on behalf of the holders of all notes waive compliance by Home Depot with
certain covenants or conditions set forth in the Indenture. The holders of not
less than a majority in outstanding Principal Amount of the notes may on behalf
of the holders of all notes waive any past default under the Indenture, except a
default in the payment of the principal of, or premium, if any, or interest on,
the notes or in respect of a provision which under the Indenture cannot be
modified or amended without the consent of the holder of each note.
DEFEASANCE
The Company will be discharged from any and all obligations in respect of
the notes (except for certain obligations to register the transfer or exchange
of notes, to replace stolen, lost or mutilated notes, to maintain paying
agencies and hold monies for payment in trust and to pay the principal of and
interest, if any, on notes), upon the irrevocable deposit with the Trustee, in
trust, of money and/or U.S. Government Obligations which through the payment of
interest and principal thereof in accordance with their terms will provide money
in an amount sufficient to pay any installment of principal, premium, if any,
and interest, if any, in respect of the notes on the stated maturity date of
such principal or installment of principal, premium, if any, or interest. Also,
the establishment of such a trust will be conditioned on the delivery by the
Company to the Trustee of an Opinion of Counsel (who may be counsel to the
Company) to the effect that, based upon applicable U.S. Federal income tax law
or a ruling published by the United States Internal Revenue Service, such a
defeasance and discharge will not be deemed, or result in, a taxable event with
respect to the Holders.
The Company may also omit to comply with the restrictive covenants described
under "--Certain Covenants--Limitation on Liens" and "--Certain
Covenants--Limitations on Sale and Lease-Back Transactions" above (together with
certain other covenants set forth in the Indenture) and any such omission shall
not be an Event of Default with respect to the notes, upon the deposit with the
Trustee, in trust, of money and/or U.S. Government Obligations which through the
payment of interest and principal in respect thereof in accordance with their
terms will provide money in an amount sufficient to pay any installment of
principal, premium, if any, and interest in respect of the notes on the stated
maturity date of such principal or installment of principal, premium, if any, or
interest. The obligations of the Company under the Indenture and the notes other
than with respect to such covenants shall remain in full force and effect. Also,
the establishment of such a trust will be conditioned on the delivery by the
Company to the Trustee of an Opinion of Counsel (who may be counsel to the
Company) to the effect that such a defeasance and discharge will not be deemed,
or result in a taxable event with respect to the Holders.
In the event the Company exercises its option to omit compliance with
certain covenants as described in the preceding paragraph with respect to the
notes and such notes are declared due and payable because of the occurrence of
any Event of Default, then the amount of money and U.S. Government Obligations
on deposit with the Trustee will be sufficient to pay amounts due on such notes
at the time of the acceleration resulting from such Event of Default. The
Company shall in any event remain liable for such payments as provided in such
notes.
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SATISFACTION AND DISCHARGE
Home Depot, at its option, may satisfy and discharge the Indenture (except
for specified obligations of Home Depot and the Trustee, including, among
others, the obligations to apply money held in trust) when:
(1) either (a) all notes previously authenticated and delivered under the
Indenture have been delivered to the Trustee for cancellation or
(b) all such notes not theretofore delivered to the Trustee for
cancellation have become due and payable, will become due and payable
at their stated maturity within one year, or 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, and
Home Depot has deposited or caused to be deposited with the Trustee
as trust funds in trust for such purpose an amount sufficient to pay
and discharge the entire indebtedness on such notes;
(2) Home Depot has paid or caused to be paid all other sums payable under
the Indenture by Home Depot; and
(3) Home Depot has delivered to the Trustee an officer's certificate and
an opinion of counsel, each to the effect that all conditions
precedent relating to the satisfaction and discharge of the Indenture
have been satisfied.
INFORMATION
Home Depot will file with the Trustee and the SEC, and transmit to holders
of the notes, such information, documents and other reports, and summaries
thereof, as may be required by the Trust Indenture Act of 1939 at the time and
in the manner provided by the Trust Indenture Act. However, any such
information, documents or reports required to be filed with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act will be filed with the Trustee within 15
calendar days after the information, document or report is required to be filed
with the SEC.
In addition, Home Depot has agreed that, for so long as any notes remain
outstanding, it will furnish to the Holders of such notes and to securities
analysts and prospective purchasers of such notes, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act. Any such request should be directed to Home Depot at the address
referred to under "Where You Can Find More Information."
Home Depot will be required to file with the Trustee annually, within four
months of the end of each fiscal year of Home Depot, a certificate as to the
compliance with all conditions and covenants of the Indenture.
GOVERNING LAW
The Indenture and the notes will be governed by, and construed in accordance
with, the laws of the State of New York.
EXCHANGE OFFER; REGISTRATION RIGHTS
In connection with the sale of the old notes by Home Depot to the initial
purchasers of the old notes, Home Depot and the initial purchasers entered into
a registration rights agreement.
In the registration rights agreement, Home Depot agreed to:
- file with the SEC no later than December 26, 1999 a registration statement
relating to an offer to exchange the new notes for old notes;
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- use its commercially reasonable efforts to cause the registration
statement to be declared effective by the SEC no later than March 25,
2000;
- offer to exchange the new notes for old notes promptly after the
effectiveness of the registration statement; and
- keep the exchange offer open for not less than 30 days (or longer if
required by applicable law) after the date on which notice of the exchange
offer is mailed to the holders of the old notes.
The registration rights agreement also requires Home Depot to take
additional action in the following circumstances:
- if Home Depot is not permitted to consummate the exchange offer because
the exchange offer is not permitted by applicable law or SEC policy;
- if any of the initial purchasers of the old notes directly from Home Depot
so requests with respect to old notes not eligible to be exchanged for new
notes in the exchange offer and held by it following consummation of the
exchange offer;
- if any holder of Transfer Restricted Securities (as defined below) is not
eligible to participate in the exchange offer or, in the case of any
holder (other than a broker-dealer) that participates in the exchange
offer, such holder does not receive freely tradeable new notes; or
- if the exchange offer is not consummated by May 4, 2000.
If these circumstances, Home Depot would be required to:
- file with the SEC as promptly as practicable, a shelf registration
statement relating to resales of the affected original securities or
exchange securities, as the case may be;
- use its commercially reasonable efforts to cause the shelf registration
statement to be declared effective under the Securities Act; and
- use its commercially reasonable efforts to keep the shelf registration
statement effective (with certain exceptions) until the earlier of
(1) two years from the effective date and (2) the date on which all
securities registered thereunder cease to be Transfer Restricted
Securities.
Home Depot will be permitted to suspend the effectiveness of the shelf
registration statement or the use of the prospectus that is part of the shelf
registration statement during specified periods ("Suspension Periods") in
specified circumstances, including circumstances relating to the pending
corporate developments.
"Transfer Restricted Securities" means each note until the earliest to occur
of:
- the date on which the note has been exchanged by a person other than a
broker-dealer for a freely tradeable new note in the exchange offer;
- following the exchange by a broker-dealer n the exchange offer of an old
note for a new note, the date on which the new note is sold to a purchaser
who receives from such broker-dealer on or prior to the date of sale a
copy of this prospectus;
- the date on which the note has been effectively registered under the
Securities Act and disposed of in accordance with the shelf registration
statement; and
- the date on which the note is distributed to the public pursuant to
Rule 144 under the Securities Act or is saleable pursuant to Rule 144(k)
under the Securities Act.
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Home Depot has agreed to pay additional interest on the old notes if any of
the following events (each of which constitutes a "registration default")
occurs:
(1) if, at the close of business on December 26, 1999, neither the
registration statement nor the shelf registration statement has been filed
with the SEC;
(2) at the close of business on May 4, 2000, the exchange offer has not
been consummated and, if required to be filed in lieu of the exchange offer,
the shelf registration statement is not declared effective by the SEC; or
(3) after either the registration statement or the shelf registration
statement is declared effective, (a) such registration statement ceases to
be effective or (b) such registration statement or the related prospectus
ceases to be usable (excluding any Suspension Periods) in connection with
resales of Transfer Restricted Securities during the applicable periods
specified in the registration rights agreement because either:
- any event occurs as a result of which the related prospectus forming part
of such registration statement would include an untrue statement of
material fact or omit to state a material fact necessary to make the
statements therein in the light of the circumstances under which they were
made not misleading; or
- it is necessary to amend such registration statement or supplement the
related prospectus to comply with the Securities Act or the Exchange Act
or the respective rules thereunder.
Additional interest will accrue on the affected old notes over and above the
interest set forth in the title of the old notes from and including the date on
which any registration default occurs to but excluding the date on which all
such registration defaults have been cured, at a rate of 0.50% per annum
(regardless of number of registration defaults).
Any holders (other than the initial purchasers) of old notes who are
eligible to participate in the exchange offer but fail to, or elect not to,
participate therein will continue to hold Transfer Restricted Securities and
will have no further rights to exchange their old notes or have such old notes
registered under the registration rights agreement.
REGARDING THE TRUSTEE
The Indenture contains certain limitations on the right of the Trustee,
should it become a creditor of Home Depot within three months of, or subsequent
to, a default by Home Depot to make payment in full of principal of or interest
on any debt securities issued pursuant to the Indenture when and as the same
becomes due and payable, to obtain payment of claims, or to realize for its own
account on property received in respect of any such claim as security or
otherwise, unless and until such default is cured. However, the Trustee's rights
as a creditor of Home Depot will not be limited if the creditor relationship
arises from, among other things:
- the ownership or acquisition of securities issued under any indenture or
having a maturity of one year or more at the time of acquisition by the
Trustee;
- certain advances authorized by a receivership or bankruptcy court of
competent jurisdiction or by the Indenture;
- disbursements made in the ordinary course of business in its capacity as
indenture trustee, transfer agent, registrar, custodian or paying agent or
in any other similar capacity;
- indebtedness created as a result of goods or securities sold in a cash
transaction or services rendered or premises rented; or
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- the acquisition, ownership, acceptance or negotiation of certain drafts,
bills of exchange, acceptances or other obligations.
The Indenture does not prohibit the Trustee from serving as trustee under
any other indenture to which Home Depot may be a party from time to time or from
engaging in other transactions with Home Depot. If the Trustee acquires any
conflicting interest within the meaning of the Trust Indenture Act and any debt
securities issued pursuant to the Indenture are in default, it must eliminate
such conflict or resign.
CERTAIN DEFINED TERMS
Capitalized terms used but not defined herein have the meanings given to
such terms in the Indenture. In addition, for purposes of the Indenture the
following definitions apply:
"Attributable Debt" in respect of any Sale and Lease-Back Transaction means,
as of the time of determination, the lesser of (1) the sale price of the
Principal Property so leased multiplied by a fraction the numerator of which is
the remaining portion of the base term of the lease included in such transaction
and the denominator of which is the base term of such lease, and (2) the total
obligation (discounted to present value at the rate of interest implicit in such
transaction compounded semiannually) of the lessee for rental payments (other
than amounts required to be paid on account of property taxes as well as
maintenance, repairs, insurance, water rates and other terms which do not
constitute payments or property rights) during the remaining portion of the base
term of the lease included in such transaction.
"Consolidated Capitalization" means the total of all of the assets appearing
on the most recent consolidated balance sheet of the Company and its
Subsidiaries, less (1) current liabilities, including liabilities for
indebtedness maturing more than 12 months from the date of the original creation
thereof, but maturing within 12 months from the date of determination, and
(2) deferred income taxes.
"Consolidated Net Tangible Assets" means the total of all of the assets
appearing on the most recent consolidated balance sheet of the Company and its
Subsidiaries (less depreciation and valuation reserves and other reserves and
items deductible from gross book value of specific asset accounts under GAAP),
after deducting therefrom (1) all current liabilities, including liabilities for
indebtedness maturing more than 12 months from the date of the original creation
thereof, but maturing within 12 months from the date of determination, and
(2) all goodwill, trade names, trademarks, patents, unamortized debt discount,
organization expenses and other like intangibles.
"Funded Indebtedness" of a corporation means the principal of
(1) indebtedness for money borrowed or evidenced by an instrument given in
connection with an acquisition which is not payable on demand and which matures,
or which such corporation has the right to renew or extend to a date, more than
one year after the date of determination, (2) any indebtedness of others of the
kinds described in the preceding clause (1) for the payment of which such
corporation is responsible or liable as a guarantor or otherwise, and
(3) amendments, renewals and refundings of any such indebtedness. For the
purposes of the definition of "Funded Indebtedness," the term "principal" when
used at any date with respect to any indebtedness means the amount of principal
of such indebtedness that could be declared due and payable on that date
pursuant to the terms of such indebtedness.
"Person" means any individual, partnership, corporation, joint stock
company, business trust, trust, unincorporated association, joint venture or
other entity, or a government or political subdivision or agency thereof.
"Principal Amount" means, when used with respect to any note, the amount of
principal thereof that could then be declared due and payable as a result of an
Event of Default with respect to such Note.
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"Principal Property" means all real property and tangible personal property
owned by the Company or a Subsidiary constituting a part of any store, warehouse
or distribution center located within the United States, exclusive of motor
vehicles, mobile materials-handling equipment and other rolling stock, cash
registers and other point of sale recording devices and related equipment, and
data processing and other office equipment; provided, however, that such term
shall not include any such property constituting a part of any such store,
warehouse or distribution center unless the net book value of all real property
(including leasehold improvements) and tangible personal property constituting a
part of such store, warehouse or distribution center exceeds 0.25% of
Consolidated Capitalization.
"Sale and Lease-Back Transaction" of the Company or any Subsidiary means any
arrangement whereby:
(1) property has been or is to be sold or transferred by the Company or
any Subsidiary to any Person with the intention on the part of the
Company or any Subsidiary of taking back a lease of such property
pursuant to which the rental payments are calculated to amortize the
purchase price of such property substantially over the useful life of
such property;
(2) such property is in fact so leased by the Company or any Subsidiary;
and
(3) the commitment by or on behalf of the purchaser or transferee is
obtained more than twelve months after the later of (a) the
completion of the acquisition, substantial repair or alteration,
construction, development or substantial improvement of such property
or (b) the placing in operation of such property or of such property
as so substantially repaired or altered, constructed, developed or
substantially improved.
"Senior Funded Indebtedness" of the Company means any Funded Indebtedness of
the Company unless in any instruments evidencing or securing such Funded
Indebtedness it is provided that such Funded Indebtedness is subordinate in
right of payment to the Notes to the extent provided in the Indenture. "Senior
Funded Indebtedness" of a Subsidiary means any Funded Indebtedness of such
Subsidiary and the aggregate preference on involuntary liquidation of any class
of stock of such Subsidiary ranking, either as to payment of dividends or
distribution of assets, prior to any other class of stock of such Subsidiary.
"Subsidiary" means, as applied, with respect to any Person, any corporation,
partnership or other legal entity of which, in the case of a corporation, more
than 50% of the issued and outstanding capital stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation has or might have voting power upon the occurrence of any
contingency), or, in the case of any partnership or other legal entity, more
than 50% of the ordinary equity capital interests, is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more of
its other Subsidiaries or by one or more of such Person's other Subsidiaries.
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U.S. FEDERAL INCOME TAX CONSEQUENCES
The following discussion is based upon current provisions of the Internal
Revenue Code of 1986, as amended, applicable Treasury regulations, proposed
Treasury regulations, judicial authority and administrative rulings and
practice. There can be no complete assurance that the Internal Revenue Service
will agree with the conclusions stated herein, and no ruling from the IRS has
been or will be sought. Legislative, judicial or administrative changes or
interpretations may be forthcoming that could alter or modify the statements set
forth herein. Any such changes or interpretations may or may not be retroactive
and could affect the tax consequences to holders. Certain holders (including
insurance companies, tax-exempt organizations, financial institutions,
broker-dealers, foreign corporations and persons who are not citizens or
residents of the United States) may be subject to special rules not discussed
below. WE RECOMMEND THAT EACH HOLDER CONSULT SUCH HOLDER'S OWN TAX ADVISOR AS TO
THE PARTICULAR CONSEQUENCES OF EXCHANGING SUCH HOLDER'S OLD NOTES FOR NEW NOTES,
INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS.
The exchange of old notes for new notes pursuant to the exchange offer will
not be treated as an "exchange" for federal income tax purposes because the new
notes do not differ materially in kind or extent from the old notes.
Accordingly:
- holders will not recognize taxable gain or loss upon the receipt of new
notes in exchange for old notes in the exchange offer;
- the holding period for a new note received in the exchange offer will
include the holding period of the old note surrendered in exchange
therefor; and
- the adjusted tax basis of a new note immediately after the exchange will
be the same as the adjusted tax basis of the old note surrendered in
exchange therefor.
PLAN OF DISTRIBUTION
We are not using any underwriters for this exchange offer. We are bearing
the expenses of the exchange.
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 such new 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 where
such old notes were acquired as a result of market-making activities or other
trading activities. We have agreed that, for a period of 135 days after the
Expiration Date, we will make this prospectus, as amended or supplemented,
available to any broker-dealer for use in connection with any such resale.
We will not receive any proceeds from any sale of new notes by
broker-dealers or any other persons. 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 the new notes, or a combination
of such methods of resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices, or negotiated prices. Any such
resale 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 any
such broker-dealer and/or the purchasers of any such new notes. Any
broker-dealer that resells new notes that were received by it for its own
account pursuant to the exchange offer and any broker-dealer that participates
in a distribution of such new notes may be deemed to be an "underwriter" within
the meaning of the Securities Act, and any profit on any such resales of new
notes and any commissions or concessions received by any such persons may be
deemed to be underwriting compensation under the Securities Act. The letter of
transmittal states that, by
40
<PAGE>
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.
For a period of 135 days after the Expiration Date, we will promptly send
additional copies of this prospectus and any amendment or supplement to this
prospectus to any broker-dealer that requests such documents in the letter of
transmittal. We have agreed to pay all expenses incident to the exchange offer
(including the expenses of one counsel for the holders of the notes) other than
commissions or concessions of any brokers or dealers and will indemnify the
holders of the notes (including any broker-dealer) against certain liabilities,
including liabilities under the Securities Act.
LEGAL MATTERS
The validity of the new notes will be passed upon for us by King & Spalding,
Atlanta, Georgia.
EXPERTS
The consolidated financial statements of The Home Depot, Inc. and
subsidiaries as of January 31, 1999 and February 1, 1998 and for each of the
years in the three-year period ended January 31, 1999, have been incorporated by
reference in this prospectus in reliance upon the report of KPMG LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
41
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
[HOME DEPOT LOGO]
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
------------------
PROSPECTUS
------------------
, 1999
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY HOME DEPOT. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED
HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE
MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF HOME DEPOT SINCE SUCH
DATE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
[This page intentionally left blank]
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Article IV, Section 4, of the Registrant's Restated By-Laws provide that to
the fullest extent permitted by Delaware law, each former, present or future,
director, officer, employee or agent of the Registrant, and each person who may
serve at the request of the Registrant as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise
shall be indemnified by the Registrant in all events.
Article NINTH of the Registrant's Restated Certificate of Incorporation
provides that to the fullest extent permitted by Delaware law, no director of
the Registrant shall be liable to the Registrant or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for
liability (i) for any breach of the director's duty of loyalty to the Registrant
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the Delaware General Corporation Law, or (iv) for any transaction
from which the director derived an improper personal benefit.
Section 145 of the General Corporation Law of the State of Delaware sets
forth the applicable terms, conditions and limitations governing the
indemnification of officers, directors and other persons.
In addition, the Registrant maintains officers' and directors' liability
insurance for the benefit of its officers and directors.
ITEM 21. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------------- -------------------------------------------------------------------------------------------------------
<S> <C>
1.1 Purchase Agreement dated September 21, 1999 between The Home Depot, Inc., Credit Suisse First Boston
Corporation and Invemed Associates LLC.
4.1 Indenture, dated as of September 27, 1999, between The Home Depot, Inc. and The Bank of New York, as
Trustee.
4.2 Registration Rights Agreement dated as of September 21, 1999 between The Home Depot, Inc., Credit
Suisse First Boston Corporation and Invemed Associates LLC.
4.3 Form of 6 1/2% Senior Note Due September 15, 2004 (included in Exhibit 4.1)
5.1 Opinion of King & Spalding.
12.1 Statement re: Computation of Ratios.
23.1 Consent of King & Spalding (included in Exhibit 5.1).
23.2 Consent of KPMG LLP, Independent Certified Public Accountants.
24.1 Powers of Attorney.
25.1 Statement of Eligibility of Trustee on Form T-1.
99.1 Form of Letter of Transmittal for 6 1/2% Senior Notes Due September 15, 2004.
99.2 Form of Notice of Guaranteed Delivery for 6 1/2% Senior Notes Due September 15, 2004.
99.3 Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.
</TABLE>
II-1
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
--------- -------------------------------------------------------------------------------------------------------
<S> <C>
99.4 Form of Letter to Clients.
99.5 Form of Letter to Nominees.
</TABLE>
(b) Financial Statement Schedules
None.
ITEM 22. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) 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) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) 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 of 1933, 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.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that
is incorporated by reference in the registration 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.
(5) To respond to requests for information that is incorporated by
reference into this 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.
(6) 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.
II-2
<PAGE>
(7) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions
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 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 against the Registrant by such
director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless 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 Act and will be governed by the
final adjudication of such issue.
II-3
<PAGE>
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 Atlanta, State of
Georgia, on October 29, 1999.
<TABLE>
<S> <C> <C>
THE HOME DEPOT, INC.
By: /s/ ARTHUR M. BLANK
-----------------------------------------
Arthur M. Blank
President & CEO
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the
capacities indicated below as of the 29th day of October, 1999.
<TABLE>
<CAPTION>
SIGNATURES TITLE
---------- -----
<S> <C>
/s/ BERNARD MARCUS
------------------------------------------- Chairman of the Board
Bernard Marcus
/s/ ARTHUR M. BLANK
------------------------------------------- President and CEO (Principal Executive
Arthur M. Blank Officer)
/s/ RONALD M. BRILL
------------------------------------------- Executive Vice President--Chief Administrative
Ronald M. Brill Officer and Director
*
------------------------------------------- Director
Frank Borman
/s/ DENNIS CAREY
------------------------------------------- Executive Vice President--Chief Financial
Dennis Carey Officer (Principal Financial Officer)
*
------------------------------------------- Director
John L. Clendenin
*
------------------------------------------- Director
Berry R. Cox
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURES TITLE
---------- -----
<S> <C>
*
------------------------------------------- Director
William S. Davila
*
------------------------------------------- Director
Milledge A. Hart, III
*
------------------------------------------- Director
Bonnie G. Hill
*
------------------------------------------- Director
Kenneth G. Langone
*
------------------------------------------- Senior Vice President and Director
M. Faye Wilson
</TABLE>
- ------------------------
* The undersigned, by signing his name hereto, does hereby sign this report on
behalf of each of the above-indicated directors of the registrant pursuant
to powers of attorney executed by such directors.
<TABLE>
<S> <C> <C> <C>
BY: /s/ ARTHUR M. BLANK
--------------------------------------
Arthur M. Blank
Attorney-in-fact
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------------- -------------------------------------------------------------------------------------------------------
<S> <C>
1.1 Purchase Agreement dated September 21, 1999 between The Home Depot, Inc., Credit Suisse First Boston
Corporation and Invemed Associates LLC.
4.1 Indenture, dated as of September 27, 1999, between The Home Depot, Inc. and The Bank of New York, as
Trustee.
4.2 Registration Rights Agreement dated as of September 21, 1999 between The Home Depot, Inc., Credit
Suisse First Boston Corporation and Invemed Associates LLC.
4.3 Form of 6 1/2% Senior Note Due September 15, 2004 (included in Exhibit 4.1)
5.1 Opinion of King & Spalding.
12.1 Statement re: Computation of Ratios.
23.1 Consent of King & Spalding (included in Exhibit 5.1).
23.2 Consent of KPMG LLP, Independent Certified Public Accountants.
24.1 Powers of Attorney.
25.1 Statement of Eligibility of Trustee on Form T-1.
99.1 Form of Letter of Transmittal for 6 1/2% Senior Notes Due September 15, 2004.
99.2 Form of Notice of Guaranteed Delivery for 6 1/2% Senior Notes Due September 15, 2004.
99.3 Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.
99.4 Form of Letter to Clients.
99.5 Form of Letter to Nominees.
</TABLE>
<PAGE>
EXECUTION COPY
$500,000,000
THE HOME DEPOT, INC.
6 1/2% SENIOR NOTES DUE 2004
PURCHASE AGREEMENT
September 21, 1999
CREDIT SUISSE FIRST BOSTON CORPORATION
INVEMED ASSOCIATES LLC
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Ladies and Gentlemen:
1. The Home Depot, Inc., a Delaware corporation (the "COMPANY"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the initial purchasers named in Schedule A hereto (the "PURCHASERS") U.S.
$500,000,000 principal amount of its 6 1/2% Senior Notes due September 15, 2004
(the "OFFERED SECURITIES") to be issued under an indenture, dated as of
September 27, 1999 (the "INDENTURE"), between the Company and The Bank of New
York, as Trustee. The United States Securities Act of 1933 is herein referred to
as the "SECURITIES ACT."
The Company hereby agrees with the Purchasers as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, the Purchasers that:
(a) A preliminary offering circular and an offering circular relating
to the Offered Securities have been prepared by the Company. Such preliminary
offering circular (the "PRELIMINARY OFFERING CIRCULAR") and offering circular
(the "OFFERING CIRCULAR"), as supplemented as of the date of this Agreement,
together with the documents listed in Schedule B hereto and any other document
approved by the Company for use in connection with the contemplated resale of
the Offered Securities are hereinafter collectively referred to as the "OFFERING
DOCUMENT." On the date of this Agreement, the Offering Document does not include
any untrue
<PAGE>
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Offering Document based upon written
information furnished to the Company by any Purchaser through Credit Suisse
First Boston Corporation ("CSFBC") specifically for use therein, it being
understood and agreed that the only such information is that described as such
in Section 7(b) hereof. Except as disclosed in the Offering Document, on the
date of this Agreement, the Company's Annual Report on Form 10-K most recently
filed with the Securities and Exchange Commission (the "COMMISSION") and all
subsequent reports (collectively, the "EXCHANGE ACT REPORTS") that have been
filed by the Company with the Commission or sent to stockholders pursuant to the
Securities Exchange Act of 1934 (the "EXCHANGE ACT") do not include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. Such documents, when they were filed with the
Commission, conformed in all material respects to the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder.
(b) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware.
(c) The Indenture has been duly authorized by all necessary corporate
action on the part of the Company; the Offered Securities have been duly
authorized by all necessary corporate action on the part of the Company; and
when the Offered Securities are delivered and paid for pursuant to this
Agreement on the Closing Date (as defined below), the Indenture will have been
duly executed and delivered by the Company, such Offered Securities will have
been duly executed, authenticated, issued and delivered and such Offered
Securities 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.
(d) Except as disclosed in the Offering Document, there are no
contracts, agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or any Purchaser for a
brokerage commission, finder's fee or other like payment.
(e) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court on the part of the Company is
required for the consummation of the transactions contemplated by this
Agreement, the Registration Rights Agreement dated the date hereof, between the
Company and
2
<PAGE>
the Purchasers (the "REGISTRATION RIGHTS AGREEMENT") in connection with the
issuance and sale of the Offered Securities by the Company except for the order
of the Commission declaring the Exchange Offer Registration Statement or the
Shelf Registration Statement (each as defined in the Registration Rights
Agreement) effective.
(f) The execution, delivery and performance of the Indenture, this
Agreement, and the Registration Rights Agreement, and the issuance and sale of
the Offered Securities and compliance with the terms and provisions thereof will
not result in a breach or violation of any of the terms and provisions of, or
constitute a default under, any law, statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or any of their
properties, or any indenture, mortgage, deed of trust, bond debenture, note or
other evidence of indebtedness or any material lease, contract or other material
agreement to which the Company or any such subsidiary is a party or by which the
Company or any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is bound, or the charter or by-laws of the
Company or any such subsidiary, as currently in effect, and the Company has full
corporate power and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement.
(g) This Agreement and the Registration Rights Agreement have been duly
authorized, executed and delivered by the Company.
(h) Except as disclosed in the Offering Document, the Company and its
subsidiaries have good and marketable title to all real properties and all other
properties and assets owned by them, in each case free from liens, encumbrances
and defects that would materially affect the value thereof or materially
interfere with the use made or to be made thereof by them and except as
disclosed in the Offering Document, the Company and its subsidiaries hold any
leased real or personal property under valid and enforceable leases with no
exceptions that would materially interfere with the use made or to be made
thereof by them, except for such liens, encumbrances, defects and exceptions as
would not have a material adverse effect on the Company and its subsidiaries
taken as a whole ("MATERIAL ADVERSE EFFECT").
(i) Except as disclosed in the Offering Document, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if determined adversely
to the Company or any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect, or would materially and adversely
affect the ability of the Company to perform its obligations under the
Indenture, this
3
<PAGE>
Agreement, the Registration Rights Agreement, or which are otherwise material in
the context of the sale of the Offered Securities; and no such actions, suits or
proceedings are threatened or, to the Company's knowledge, contemplated.
(j) Except as disclosed in the Offering Document, since the date of the
latest audited financial information included in the Offering Document there has
been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole, and, except as disclosed in or contemplated by
the Offering Document, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(k) No securities of the same class (within the meaning of Rule
144A(d)(3) under the Securities Act) as the Offered Securities are listed on any
national securities exchange registered under Section 6 of the Exchange Act or
quoted in a U.S. automated inter-dealer quotation system.
(l) Assuming the accuracy of the representations and warranties
contained in Section 4 of the Agreement, the offer and sale of the Offered
Securities in the manner contemplated by this Agreement will be exempt from the
registration requirements of the Securities Act by reason of Section 4(2)
thereof and Regulation S thereunder and it is not necessary in connection with
the offer and sale of the Offered Securities to the Purchasers to qualify an
indenture in respect of the Offered Securities under the United States Trust
Indenture Act of 1939, as amended (the "TRUST INDENTURE ACT").
(m) Neither the Company, nor any of its affiliates, nor any person
acting on its or their behalf (i) has, within the six-month period prior to the
date hereof, offered or sold in the United States or to any U.S. person (as such
terms are defined in Regulation S under the Securities Act) the Offered
Securities or any security of the same class or series as the Offered Securities
or (ii) has offered or will offer or sell the Offered Securities (A) in the
United States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act or (B)
with respect to any such securities sold in reliance on Rule 903 of Regulation S
("REGULATION S") under the Securities Act, by means of any directed selling
efforts within the meaning of Rule 902(c) of Regulation S. The Company, its
affiliates and any person acting on its or their behalf have complied and will
comply with the offering restrictions requirement of Regulation S. The Company
has not entered and will not enter into any contractual arrangement with respect
to the distribution of the Offered Securities except for this Agreement and the
Registration Rights Agreement.
4
<PAGE>
3. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Purchasers, and each of the Purchasers agrees, severally and not jointly, to
purchase from the Company at a purchase price of 99.332% of the principal amount
thereof, the respective principal amounts of Offered Securities set forth
opposite the names of the Purchasers in Schedule A hereto.
The Company will deliver against payment of the purchase price the
Offered Securities in the form of one or more permanent global Securities in
definitive form (the "GLOBAL SECURITIES") deposited with the Trustee as
custodian for The Depository Trust Company ("DTC") and registered in the name of
Cede & Co., as nominee for DTC. Interests in any permanent Global Securities
will be held only in book-entry form through DTC, except in the limited
circumstances described in the Offering Document. Payment for the Offered
Securities shall be made by the Purchasers in federal (same day) funds by
official check or checks or wire transfer to an account previously designated by
the Company for such purpose at a bank reasonably acceptable to CSFBC at 9:30
A.M. (New York time), on September 27, 1999 or at such other time not later than
seven full business days thereafter as CSFBC and the Company determine, such
time being herein referred to as the "CLOSING DATE", against delivery to the
Trustee as custodian for DTC of the Global Securities representing all of the
Offered Securities. The Global Securities will be made available for checking at
the offices of Davis Polk & Wardwell or its designated custodian at least 24
hours prior to the Closing Date.
4. REPRESENTATIONS BY PURCHASERS; RESALE BY PURCHASERS. (a) Each
Purchaser severally represents and warrants to the Company that it is an
"accredited investor" within the meaning of Regulation D under the Securities
Act.
(b) Each Purchaser severally acknowledges that the Offered Securities
have not been registered under the Securities Act and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
except in accordance with Regulation S or pursuant to another exemption from the
registration requirements of the Securities Act. Each Purchaser severally
represents and agrees that it has offered and sold the Offered Securities, and
will offer and sell the Offered Securities only in accordance with Rule 903 or
Rule 144A under the Securities Act ("RULE 144A"). Accordingly, neither such
Purchaser nor its affiliates, nor any persons acting on its or their behalf,
have engaged or will engage in any directed selling efforts with respect to the
Offered Securities, and such Purchaser, its affiliates and all persons acting on
its or their
5
<PAGE>
behalf have complied and will comply with the offering restrictions requirement
of Regulation S and Rule 144A.
(c) Each Purchaser severally agrees that it and each of its affiliates
has not entered and will not enter into any contractual arrangement with respect
to the distribution of the Offered Securities except for any such arrangements
with the other Purchasers or affiliates of the other Purchasers or with the
prior written consent of the Company.
(d) Each Purchaser severally agrees that it and each of its affiliates
will not offer or sell the Offered Securities in the United States by means of
any form of general solicitation or general advertising within the meaning of
Rule 502(c) under the Securities Act, or by means of a public offering within
the meaning of Section 4(2) of the Securities Act, including, but not limited to
(i) any advertisement, article, notice or other communication published in any
newspaper, magazine or similar media or broadcast over television or radio, or
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising. Each Purchaser severally agrees, with
respect to resales made in reliance on Rule 144A of any of the Offered
Securities, to deliver either with the confirmation of such resale or otherwise
prior to settlement of such resale a notice to the effect that the resale of
such Offered Securities has been made in reliance upon the exemption from the
registration requirements of the Securities Act provided by Rule 144A.
(e) Each of the Purchasers severally represents and agrees that (i) it
has not offered or sold and prior to the date six months after the date of issue
of the Offered Securities will not offer or sell any Offered Securities to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public Offers of
Securities Regulations 1995; (ii) it has complied and will comply with all
applicable provisions of the Financial Services Act 1986 with respect to
anything done by it in relation to the Offered Securities in, from or otherwise
involving the United Kingdom; and (iii) it has only issued or passed on and will
only issue or pass on in the United Kingdom any document received by it in
connection with the issue of the Offered Securities to a person who is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on.
5. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with the
several Purchasers that:
6
<PAGE>
(a) The Company will advise CSFBC promptly of any proposal to amend or
supplement the Offering Document and will not effect such amendment or
supplementation without CSFBC's consent, which consent shall not be unreasonably
withheld. If, at any time prior to the completion of the resale of the Offered
Securities by the Purchasers, any event occurs as a result of which the Offering
Document as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, the Company promptly will notify CSFBC of such event and
promptly will prepare, at its own expense, an amendment or supplement which will
correct such statement or omission. Neither CSFBC's consent to, nor the
Purchasers' delivery to offerees or investors of, any such amendment or
supplement shall constitute a waiver of any of the conditions set forth in
Section 6.
(b) The Company will furnish to CSFBC copies of any preliminary
offering circular, the Offering Document and all amendments and supplements to
such documents, in each case as soon as available and in such quantities as
CSFBC reasonably requests. At any time when the Company is not subject to
Section 13 or 15(d) of the Exchange Act and any Offered Securities are
outstanding, upon request of holders and prospective purchasers of the Offered
Securities the Company will furnish or cause to be furnished, to such holders
and purchasers, copies of the information required to be delivered to holders
and prospective purchasers of the Offered Securities pursuant to Rule 144A(d)(4)
under the Securities Act (or any successor provision thereto) in order to permit
compliance with Rule 144A in connection with resales by such holders of the
Offered Securities. The Company will pay the expenses of printing and
distributing to the Purchasers all such documents.
(c) The Company will endeavor in good faith in cooperation with the
Purchasers to arrange for the qualification of the Offered Securities for sale
and the determination of their eligibility for investment under the laws of such
jurisdictions in the United States and Canada as CSFBC designates and will
continue such qualifications in effect so long as required for the resale of the
Offered Securities by the Purchasers, provided that the Company will not be
required to qualify as a foreign corporation or to file a general consent to
service of process or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject.
(d) During the period of ten years hereafter, the Company will furnish
to CSFBC and, upon request, to each of the other Purchasers, as soon as
practicable
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after the end of each fiscal year, a copy of its annual report to stockholders
for such year; and the Company will furnish to CSFBC and, upon request, to each
of the other Purchasers (i) as soon as available, a copy of each report and any
definitive proxy statement of the Company filed with the Commission under the
Exchange Act or mailed to stockholders and (ii) from time to time, such other
information concerning the Company as CSFBC may reasonably request.
(e) During the period of two years after the Closing Date or, if
earlier, until such time as the Offered Securities are no longer restricted
securities (as defined in Rule 144 under the Securities Act), the Company will,
upon request, furnish to CSFBC, each of the other Purchasers and any holder of
Offered Securities a copy of the restrictions on transfer applicable to the
Offered Securities.
(f) During the period of two years after the Closing Date or, if
earlier, until such time as the Offered Securities are no longer restricted
securities (as defined in Rule 144 under the Securities Act), the Company will
use its reasonable efforts to cause its affiliates (as defined in Rule 144 under
the Securities Act) not to resell any of the Offered Securities that have been
reacquired by any of them.
(g) The Company will pay all expenses incidental to the performance of
its obligations under this Agreement, the Indenture, and the Registration Rights
Agreement, including (i) the fees and expenses of the Trustee and its
professional advisers; (ii) all expenses in connection with the execution,
issue, authentication, packaging and initial delivery of the Offered Securities
and, as applicable, the Exchange Securities (as defined in the Registration
Rights Agreement), the preparation and printing of this Agreement, the
Registration Rights Agreement, the Offered Securities, the Indenture, the
Offering Document and amendments and supplements thereto, and any other document
relating to the issuance, offer, sale and delivery of the Offered Securities and
as applicable, the Exchange Securities; (iii) the cost of any advertising
approved by the Company in connection with the issue of the Offered Securities
(iv) for any expenses (including fees and disbursements of counsel) incurred in
connection with qualification of the Offered Securities or the Exchange
Securities for sale under the laws of such jurisdictions in the United States
and Canada as CSFBC designates and the printing of memoranda relating thereto,
(v) for any fees charged by investment rating agencies for the rating of the
Securities or the Exchange Securities, and (vi) for expenses incurred in
distributing preliminary offering circulars and the Offering Document (including
any amendments and supplements thereto) to the Purchasers. The Company will also
pay or reimburse the Purchasers (to the extent incurred by them) for all travel
expenses of the Company's officers and employees and any other expenses of the
Company in connection with attending or hosting meetings with prospective
purchasers of the Offered Securities from the Purchasers.
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<PAGE>
(h) In connection with the offering, until CSFBC shall have notified
the Company and the other Purchasers of the completion of the resale of the
Offered Securities, neither the Company nor any of its affiliates has or will,
either alone or with one or more other persons, bid for or purchase for any
account in which it or any of its affiliates has a beneficial interest any
Offered Securities or attempt to induce any person to purchase any Offered
Securities; and neither it nor any of its affiliates will make bids or purchases
for the purpose of creating actual, or apparent, active trading in, or of
raising the price of, the Offered Securities.
(i) During the period beginning on the date hereof and continuing to
and including the Closing Date, the Company will not offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, any United States
dollar-denominated debt securities issued or guaranteed by the Company and
having a maturity of more than one year from the date of issue. The Company will
not at any time offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, any securities under circumstances where such offer,
sale, pledge, contract or disposition would cause the exemption afforded by
Section 4(2) of the Securities Act or the safe harbor of Regulation S thereunder
to cease to be applicable to the offer and sale of the Offered Securities.
6. CONDITIONS OF THE OBLIGATIONS OF THE PURCHASERS. The obligations of
the several Purchasers to purchase and pay for the Offered Securities will be
subject to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of officers of the Company
made pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) The Purchasers shall have received a letter, dated the date of this
Agreement, of KPMG LLP in agreed form confirming that they are independent
public accountants certified with respect to the Home Depot, Inc. under rule 101
of the AICPA's Code of Professional Conduct, and its interpretations and
rulings.
(i) in their opinion the consolidated financial statements
examined by them and incorporated by reference in the Offering Document
and in the Exchange Act Reports comply as to form in all material
respects with the applicable accounting requirements of the Securities
Act and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards
No. 71, Interim Financial Information, on the unaudited consolidated
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<PAGE>
financial statements incorporated by reference in the Offering Document
and in the Exchange Act Reports;
(iii) on the basis of the review referred to in clause (ii) above,
a reading of the latest available unaudited interim consolidated
financial statements of the Company, inquiries of officials of the
Company who have responsibility for financial and accounting matters
and other specified procedures, nothing came to their attention that
caused them to believe that:
(A) the unaudited consolidated financial statements
incorporated by reference in the Offering Document or in the
Exchange Act Reports do not comply as to form in all material
respects with the applicable accounting requirements of the
Securities Act and the related published Rules and Regulations or
any material modifications should be made to such unaudited
consolidated financial statements for them to be in conformity
with generally accepted accounting principles;
(B) the unaudited consolidated net sales, operating income,
net earnings and net earnings per share amounts for the six-month
periods ended August 1, 1999 and August 2, 1998 incorporated by
reference in the Offering Document do not agree with the amounts
set forth in the unaudited consolidated financial statements for
those same periods or were not determined on a basis substantially
consistent with that of the corresponding amounts in the audited
statements of earnings;
(C) at the date of the latest available balance sheet read by
such accountants, or at a subsequent specified date not more than
three business days prior to the date of this Agreement, there was
any change in the capital stock or any increase in short-term
indebtedness or long-term debt of the Company and its consolidated
subsidiaries or, at the date of the latest available unaudited
consolidated balance sheet read by such accountants, there was any
decrease in consolidated net current assets or net assets, as
compared with amounts shown on the latest unaudited consolidated
balance sheet incorporated by reference in the Offering Document;
(D) for the period from the closing date of the latest
unaudited consolidated statement of earnings incorporated by
reference in the Offering Document to the closing date of the
latest
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<PAGE>
available unaudited consolidated statement of earnings read by
such accountants there were any decreases, as compared with the
corresponding period of the previous year, in operating income
consolidated net earnings or in the ratio of earnings to fixed
charges;
except in all cases set forth in clauses 6(a)(iii)(C) and
6(a)(iii)(D) above for changes, increases or decreases which the
Offering Document disclose have occurred or may occur or which are
described in such letter; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Offering Document and the Exchange Act Reports (in
each case to the extent that such dollar amounts, percentages and other
financial information are derived from the general accounting records
of the Company and its subsidiaries subject to the internal controls of
the Company's accounting system or are derived directly from such
records by analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and other
procedures specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
(b) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) a change in U.S. or international financial,
political or economic conditions or currency exchange rates or exchange controls
as would, in the judgment of CSFBC, be likely to prejudice materially the
success of the proposed issue, sale or distribution of the Offered Securities,
whether in the primary market or in respect of dealings in the secondary market,
or (ii) (A) any change, or any development or event involving a prospective
change, in the condition (financial or other), business, properties or results
of operations of the Company and its subsidiaries, taken as one enterprise,
which, in the judgment of a majority in interest of the Purchasers including
CSFBC, is material and adverse and makes it impractical or inadvisable to
proceed with completion of the offering or the sale of and payment for the
Offered Securities; (B) any downgrading in the rating of any debt securities of
the Company by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Securities Act), or any public
announcement that any such organization has under surveillance or review its
rating of any debt securities of the Company (other than an announcement with
positive implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (C) any material suspension or material limitation
of trading in securities generally on the New
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<PAGE>
York Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company on any
exchange or in the over-the-counter market; (D) any banking moratorium declared
by U.S. Federal or New York authorities; or (E) any outbreak or escalation of
major hostilities in which the United States is involved, any declaration of war
by Congress or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the Purchasers
including CSFBC, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed with
completion of the offering or sale of and payment for the Offered Securities.
(c) The Purchasers shall have received an opinion, dated the Closing
Date, of King and Spalding, counsel for the Company, that:
(i) the Company is an existing corporation in good standing
under the laws of the State of Delaware, with corporate power and
authority to own its properties and conduct its business as described
in the Offering Document;
(ii) the Indenture has been duly authorized, executed and
delivered by the Company; the Offered Securities on the Closing Date
have been duly authorized, executed, authenticated, issued and
delivered and conform to the description thereof contained in the
Offering Document; and the Indenture and the Offered Securities
constitute valid and legally binding obligations of the Company
enforceable against the Company 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;
(iii) no consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required on the
part of the Company for the consummation of the transactions
contemplated by this Agreement, the Indenture or the Registration
Rights Agreement in connection with the issuance or sale of the Offered
Securities by the Company, except such as may be required under state
securities laws except for the order of the Commission declaring the
Exchange Offer Registration Statement or the Shelf Registration
Statement effective;
(iv) the execution, delivery and performance of the Indenture,
this Agreement and the Registration Rights Agreement and the issuance
and sale of the Offered Securities and compliance with the terms and
provisions thereof will not result in a breach or violation of any of
the
12
<PAGE>
terms and provisions of, or constitute a default under, any statute,
rule, regulation or order of any governmental agency or body or any
court having jurisdiction over the Company or any subsidiary of the
Company or any of their properties, or the charter or by-laws of the
Company or any such subsidiary, as currently in effect, and the Company
has full corporate power and authority to authorize, issue and sell the
Offered Securities as contemplated by this Agreement;
(v) in addition, such counsel shall state that, in their
capacity as counsel for the Company, they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company,
and with representatives and counsel for the Purchasers at which the
contents of the Offering Document were discussed, and, although such
counsel is not passing on and does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in
the Offering Document, on the basis of the information that was
developed in the course of such counsel's performance of the services
referred to above, nothing has come to such counsel's attention that
causes such counsel to believe that the Offering Circular, or any
amendment or supplement thereto, or any Exchange Act Report as of the
date hereof and as of such Closing Date, contained any untrue statement
of a material fact or omitted to state any material fact necessary to
make the statements therein not misleading; the descriptions in the
Company's Form 10-K for the year ended January 31, 1999 under the
Caption "Item 3. Legal Proceedings"of statutes, legal and governmental
proceedings and contracts and other documents are accurate and fairly
present the information; it being understood that such counsel need
express no opinion or belief as to the financial statements or other
financial data contained in, incorporated by reference in, or omitted
from the Offering Circular and the Exchange Act Reports;
(vi) this Agreement and the Registration Rights Agreement have
each been duly authorized, executed and delivered by the Company;
(vii) assuming (A) the accuracy of the representations and
warranties of the Company set forth in Section 2 of this Agreement
(other than clauses (k), (l) and (m) thereof) and of the Purchasers set
forth in Section 4 of this Agreement, (B) the due performance by the
Company of the covenants and agreements set forth in Section 5 of this
Agreement and the due performance by the Purchasers of the covenants
set forth in Section 4 of this Agreement, (C) compliance by the
Purchasers with the offering and transfer procedures and restrictions
described in the Offering Document and (D) the accuracy of the
representations and warranties
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<PAGE>
made in accordance with the Offering Document by buyers to whom the
Purchasers initially resell the Offered Securities, it is not necessary
in connection with (A) the offer, sale and delivery of the Offered
Securities by the Company to the Purchasers pursuant to this Agreement
and the Offering Document or (B) the initial resales of the Offered
Securities by the Purchasers in the manner contemplated by this
Agreement and the Offering Document to register the Offered Securities
under the Securities Act or to qualify an indenture in respect thereof
under the Trust Indenture Act (it being understood that we express no
opinion in this paragraph as to any subsequent resale of any Offered
Securities).
In giving the opinions required by this subsection (c) of this Section
6, King & Spalding, (i) may limit such opinion to the laws of the State of
Georgia and New York and the corporate law of the State of Delaware and the
Federal laws of the United States, and (ii) may rely, as to matters of fact,
upon the representations and warranties of the Company contained herein and upon
certificates of officers of the Company and of public officials. The foregoing
opinions may also be subject to such assumptions and qualifications as are
satisfactory to counsel for the Purchasers.
(d) You shall have received an opinion, dated such Closing Date, of
Kelly R. Caffarelli, Corporate Counsel of the Company, to the effect that:
(i) the Company has been duly incorporated under the laws of the
State of Delaware;
(ii) such counsel does not know of any legal or governmental
proceedings required to be described in the Offering Document in which
are not described as required or of any contracts or documents of a
character required to be described in the Offering Document or to be
filed as exhibits to any document incorporated by reference in the
Offering Document which are not described and filed as required;
(iii) the documents incorporated by reference in the Offering
Document, when they were filed with the Commission, complied as to form
in all material respects with the requirements of the Exchange Act and
the rules and regulations of the Commission thereunder;
(iv) the execution, delivery and performance by the Company of
the Indenture, this Agreement and the Registration Rights Agreement and
the issuance and sale of the Offered Securities and compliance with the
terms and provisions thereof will not result in a breach or violation
of any of the material terms and provisions of, or constitute a default
under any
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<PAGE>
indenture, mortgage, deed of trust, bond, debenture, note or other
evidence of indebtedness or any material lease, contract or other
agreement or instrument known to such counsel to which the Company or
any of its subsidiaries is a party or by which the Company or any such
subsidiary is bound or to which any of the properties of the Company or
any such subsidiary is bound.
In giving the opinions required by this subsection (d) of this Section
6, Kelly R. Caffarelli (i) may limit such opinion to the laws of the State of
Georgia and the corporate law of the State of Delaware and the Federal laws of
the United States, and (ii) may rely, as to matters of fact, upon the
representations and warranties of the Company contained herein and upon
certificates of officers of the Company and of public officials. The foregoing
opinions may also be subject to such assumptions and qualifications as are
satisfactory to counsel for the Purchasers.
(e) The Purchasers shall have received from Davis Polk & Wardwell,
counsel for the Purchasers, such opinion or opinions, dated Closing Date, with
respect to the validity of the Offered Securities, the Offering Document, the
exemption from registration for the offer and sale of the Offered Securities by
the Company to the several Purchasers and the resales by the several Purchasers
as contemplated hereby and other related matters as CSFBC may require, and the
Company shall have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(f) The Purchasers shall have received a certificate, dated the Closing
Date, of the President or any Vice President and a principal financial or
accounting officer of the Company in which such officers, to the best of their
knowledge after reasonable investigation, shall state that the representations
and warranties of the Company in this Agreement are true and correct, that the
Company has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the Closing Date, and
that, subsequent to the dates of the most recent financial statements in the
Exchange Act Reports there has been no material adverse change, nor any
development or event involving a prospective material adverse change, in the
condition (financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole except as set forth in or
contemplated by the Offering Document or as described in such certificate.
(g) The Purchasers shall have received a letter, dated the Closing
Date, of KPMG LLP which meets the requirements of subsection (a) of this
Section, except that the specified date referred to in such subsection will be a
date not more than three days prior to the Closing Date for the purposes of this
subsection.
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<PAGE>
The Company will furnish the Purchasers with such conformed copies of
such opinions, certificates, letters and documents as the Purchasers reasonably
request. CSFBC may in its sole discretion waive on behalf of the Purchasers
compliance with any conditions to the obligations of the Purchasers hereunder,
whether in respect of an Optional Closing Date or otherwise.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will indemnify and
hold harmless each Purchaser, its partners, directors and officers and each
person, if any, who controls such Purchaser within the meaning of Section 15 of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such Purchaser may become subject, under the Securities Act or
the Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Offering Document, or any amendment or supplement thereto, or any related
preliminary offering circular, or arise out of or are based upon the omission or
alleged omission to state therein a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, including any losses, claims, damages or liabilities
arising out of or based upon the Company's failure to perform its obligations
under Section 5(a) of this Agreement, and will reimburse each Purchaser for any
legal or other expenses reasonably incurred by such Purchaser in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company will not be
liable 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 in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by any Purchaser through CSFBC specifically for use therein, it being
understood and agreed that the only such information consists of the information
described as such in subsection (b) below and, PROVIDED, FURTHER, that with
respect to any untrue statement or alleged untrue statement in or omission or
alleged omission from any preliminary offering circular the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any Purchaser
that sold Offered Securities to the person asserting any such losses, claims,
damages or liabilities, to the extent that such sale was an initial resale by
such Purchaser and any such loss, claim, damage or liability of such Purchaser
results from the fact that there were not or given to such person, at or prior
to the written confirmation of the sale such Offered Securities to such person,
a copy of the Offering Document (exclusive of any material included therein but
not attached thereto) if the Company had previously furnished copies thereof to
such Purchaser and the untrue statement or omission or alleged untrue statement
or omission was corrected in the Offering Memorandum.
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(b) Each Purchaser will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act,
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Securities Act or the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Offering Document, or any
amendment or supplement thereto, or any related preliminary offering circular,
or arise out of or are based upon the omission or the alleged omission to state
therein a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, 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
Purchaser through CSFBC specifically for use therein, and will reimburse any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Purchaser consists of the following information in
the Offering Document: under the caption "Plan of Distribution": the information
in the table and the second, eighth and ninth paragraphs; PROVIDED, HOWEVER,
that the Purchasers shall not be liable for any losses, claims, damages or
liabilities arising out of or based upon the Company's failure to perform its
obligations under Section 5(a) of this Agreement.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel 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, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
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<PAGE>
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party which consent shall not be
unreasonably withheld, effect any settlement of any pending or threatened action
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party unless such
settlement includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action and does not
include a statement as to or an admission of fault, culpability or failure to
act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Purchasers other from the offering of the Offered Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Purchasers on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Purchasers on the other
shall be deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company bear to the total
discounts and commissions received by the Purchasers from the Company under this
Agreement. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Purchasers and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Purchaser shall be required to contribute any amount in excess of the amount by
which the total price at which the Offered Securities purchased by it were
resold exceeds the amount of any damages which such Purchaser 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 Act) shall be entitled to contribution from
any
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person who was not guilty of such fraudulent misrepresentation. The Purchasers'
obligations in this subsection (d) to contribute are several in proportion to
their respective purchase obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Purchaser within the meaning of the Securities Act or the Exchange Act; and the
obligations of the Purchasers under this Section shall be in addition to any
liability which the respective Purchasers may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act.
8. DEFAULT OF PURCHASERS. If any Purchaser or Purchasers default in
their obligations to purchase Offered Securities hereunder and the aggregate
principal amount of Offered Securities that such defaulting Purchaser or
Purchasers agreed but failed to purchase does not exceed 10% of the total
principal amount of the Offered Securities, CSFBC may make arrangements
satisfactory to the Company for the purchase of such Offered Securities by other
persons, including any of the Purchasers, but if no such arrangements are made
by the Closing Date, the non-defaulting Purchasers shall be obligated severally,
in proportion to their respective commitments hereunder, to purchase the Offered
Securities that such defaulting Purchasers agreed but failed to purchase. If any
Purchaser or Purchasers so default and the aggregate principal amount of the
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total principal amount of the Offered Securities and arrangements
satisfactory to CSFBC and the Company for the purchase of such Offered
Securities by other persons are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of any
non-defaulting Purchaser or the Company, except as provided in Section 9. As
used in this Agreement, the term "PURCHASER" includes any persons substituted
for a Purchaser under this Section 8. Nothing herein will relieve a defaulting
Purchaser from liability for its default.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the Purchasers set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or on behalf of
any Purchaser, the Company or any of their respective representatives, officers
or directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the Purchasers
is not consummated, the Company shall remain responsible for the expenses to be
paid
19
<PAGE>
or reimbursed by it pursuant to Section 5 and the respective obligations of the
Company and the Purchasers pursuant to Section 7 shall remain in effect. If the
purchase of the Offered Securities by the Purchasers is not consummated for any
reason other than solely because of the termination of this Agreement pursuant
to Section 8 or the occurrence of any event specified in clause (C), (D) or (E)
of Section 6(b)(ii), the Company will reimburse the Purchasers for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
10. NOTICES. All communications hereunder will be in writing and, if
sent to the Purchasers will be mailed, delivered or telegraphed and confirmed to
the Purchasers, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory Group, or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at 2455 Paces Ferry Road, NW, Atlanta, GA 30339, Attention: Dennis J.
Carey, Executive Vice President and Chief Financial Officer, with a copy to
Kelly R. Caffarelli, Corporate Counsel; provided, however, that any notice to a
Purchaser pursuant to Section 7 will be mailed, delivered or telegraphed and
confirmed to such Purchaser.
11. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
controlling persons referred to in Section 7, and no other person will have any
right or obligation hereunder, except that holders of Offered Securities shall
be entitled to enforce the agreements for their benefit contained in the second
and third sentences of Section 5(b) hereof against the Company as if such
holders were parties thereto.
12. REPRESENTATION OF PURCHASERS. CSFB will act for the Purchasers in
connection with this purchase, and any action under this Agreement taken by CSFB
will be binding upon all the Purchasers.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York without regard to
principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
20
<PAGE>
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
21
<PAGE>
If the foregoing is in accordance with the Purchasers' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Company and the several
Purchasers in accordance with its terms.
Very truly yours,
THE HOME DEPOT, INC.
By: /s/ Carol B. Tome
-------------------------------
Name: Carol B. Tome
Title: Vice President-Treasurer
The foregoing Purchase Agreement
is hereby confirmed and accepted
as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
INVEMED ASSOCIATES LLC
Acting on behalf of themselves
and as the Representative
of the Purchasers
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Andrew R. Taussig
-----------------------------------
Name: Andrew R. Taussig
Title: Managing Director
22
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
PRINCIPAL-AMOUNT
OF OFFERED SENIOR
INITIAL PURCHASER NOTES
- -------------------------------------- -------------------
<S> <C>
CREDIT SUISSE FIRST BOSTON CORPORATION $250,000,000
INVEMED ASSOCIATES LLC $250,000,000
------------
Total....................................... $500,000,00
------------
------------
</TABLE>
23
<PAGE>
SCHEDULE B
- Home Depot's Annual Report on Form 10-K for the fiscal year ended
January 31, 1999;
- Home Depot's Quarterly Report on Form 10-Q for the fiscal quarter
ended May 2, 1999; and
- Home Depot's Quarterly Report on Form 10-Q for the fiscal quarter
ended August 1, 1999
24
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
THE HOME DEPOT, INC., as Company
AND
The Bank of New York, as Trustee
Indenture
Dated as of September 27, 1999
----------
$500,000,000
6 1/2% Senior Notes due September 15, 2004
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
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<TABLE>
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<S> <C> <C>
ARTICLE 1
DEFINITIONS
SECTION 1.01. CERTAIN TERMS DEFINED...........................................................16
SECTION 1.02. OTHER DEFINITIONS...............................................................25
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
SECTION 2.01. AUTHENTICATION AND DELIVERY OF SECURITIES.......................................25
SECTION 2.02. EXECUTION OF SECURITIES.........................................................26
SECTION 2.03. CERTIFICATE OF AUTHENTICATION...................................................26
SECTION 2.04. FORM, DENOMINATION AND DATE OF SECURITIES; PAYMENTS OF
INTEREST........................................................................26
SECTION 2.05. RESTRICTIVE LEGENDS.............................................................27
SECTION 2.06. REGISTRATION, TRANSFER AND EXCHANGE.............................................30
SECTION 2.07. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES.....................................31
SECTION 2.08. SPECIAL TRANSFER PROVISIONS.....................................................33
SECTION 2.09. MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN SECURITIES.......................35
SECTION 2.10. CANCELLATION OF SECURITIES......................................................36
SECTION 2.11. TEMPORARY SECURITIES............................................................36
SECTION 2.12. CUSIP AND CINS NUMBERS..........................................................36
ARTICLE 3
CERTAIN COVENANTS
SECTION 3.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST ON SECURITIES........................37
SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY.................................................37
SECTION 3.03. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST...............................37
SECTION 3.04. EXISTENCE.......................................................................39
SECTION 3.05. STATEMENT BY OFFICERS AS TO DEFAULT.............................................39
SECTION 3.06. WAIVER OF CERTAIN COVENANTS.....................................................39
SECTION 3.07. LIMITATIONS ON LIENS............................................................40
SECTION 3.08. LIMITATIONS ON SALE AND LEASEBACK TRANSACTIONS..................................42
SECTION 3.09. REPORTS BY THE COMPANY..........................................................43
</TABLE>
i
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ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. EVENTS OF DEFAULT...............................................................43
SECTION 4.02. ACCELERATION....................................................................45
SECTION 4.03. OTHER REMEDIES..................................................................46
SECTION 4.04. WAIVER OF PAST DEFAULTS.........................................................46
SECTION 4.05. CONTROL BY MAJORITY.............................................................46
SECTION 4.06. LIMITATION ON SUITS.............................................................47
SECTION 4.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT............................................47
SECTION 4.08. COLLECTION SUIT BY TRUSTEE......................................................48
SECTION 4.09. TRUSTEE MAY FILE PROOFS OF CLAIM................................................48
SECTION 4.10. PRIORITIES......................................................................48
SECTION 4.11. UNDERTAKING FOR COSTS...........................................................49
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING DEFAULT;
PRIOR TO DEFAULT................................................................49
SECTION 5.02. CERTAIN RIGHTS OF THE TRUSTEE...................................................51
SECTION 5.03. TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF
SECURITIES OR APPLICATION OF PROCEEDS THEREOF...................................52
SECTION 5.04. TRUSTEE AND AGENTS MAY HOLD SECURITIES; COLLECTIONS, ETC........................52
SECTION 5.05. MONEYS HELD BY TRUSTEE..........................................................53
SECTION 5.06. NOTICE OF DEFAULT...............................................................53
SECTION 5.07. COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS
PRIOR CLAIM.....................................................................53
SECTION 5.08. RIGHT OF TRUSTEE TO RELY ON OFFICER'S CERTIFICATE, ETC..........................54
SECTION 5.09. PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE.....................................54
SECTION 5.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR
TRUSTEE.........................................................................54
SECTION 5.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE..................................56
SECTION 5.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS OF TRUSTEE.............................................................57
SECTION 5.13. PREFERENTIAL COLLECTION OF CLAIMS...............................................57
</TABLE>
ii
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<TABLE>
<CAPTION>
PAGE
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<S> <C> <C>
ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. EVIDENCE OF ACTION TAKEN BY HOLDERS.............................................58
SECTION 6.02. PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF
SECURITIES; RECORD DATE.........................................................58
SECTION 6.03. WHO MAY BE DEEMED OWNERS OF SECURITIES..........................................59
SECTION 6.04. SECURITIES OWNED BY COMPANY DEEMED NOT OUTSTANDING..............................59
SECTION 6.05. RECORD DATE FOR ACTION BY SECURITYHOLDERS.......................................60
SECTION 6.06. RIGHT OF REVOCATION OF ACTION TAKEN.............................................60
ARTICLE 7
SECURITYHOLDERS' MEETINGS
SECTION 7.01. PURPOSES FOR WHICH MEETING MAY BE CALLED........................................61
SECTION 7.02. MANNER OF CALLING MEETINGS; RECORD DATE.........................................61
SECTION 7.03. CALL OF MEETING BY COMPANY OR SECURITYHOLDERS...................................62
SECTION 7.04. WHO MAY ATTEND AND VOTE AT MEETING..............................................62
SECTION 7.05. REGULATIONS.....................................................................62
SECTION 7.06. MANNER OF VOTING AT MEETINGS AND RECORD TO BE KEPT..............................63
SECTION 7.07. EXERCISE OF RIGHTS OF TRUSTEE AND SECURITYHOLDERS NOT TO BE
HINDERED OR DELAYED.............................................................64
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS..............................64
SECTION 8.02. WITH CONSENT OF HOLDERS.........................................................65
SECTION 8.03. EFFECT OF SUPPLEMENTAL INDENTURE................................................66
SECTION 8.04. DOCUMENTS TO BE GIVEN TO TRUSTEE; COMPLIANCE WITH TIA...........................66
SECTION 8.05. NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL
INDENTURES......................................................................67
ARTICLE 9
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 9.01. WHEN THE COMPANY MAY MERGE, ETC.................................................67
SECTION 9.02. SUCCESSOR CORPORATION SUBSTITUTED...............................................68
SECTION 9.03. OPINION OF COUNSEL TO TRUSTEE...................................................68
</TABLE>
iii
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<TABLE>
<CAPTION>
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<S> <C> <C>
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.01. RIGHT OF OPTIONAL REDEMPTION; PRICES...........................................68
SECTION 10.02. NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS......................................69
SECTION 10.03. PAYMENT OF SECURITIES CALLED FOR REDEMPTION....................................70
ARTICLE 11
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.01. COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT
DEFEASANCE.....................................................................71
SECTION 11.02. LEGAL DEFEASANCE AND DISCHARGE.................................................71
SECTION 11.03. COVENANT DEFEASANCE............................................................71
SECTION 11.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.....................................72
SECTION 11.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD
IN TRUST; OTHER MISCELLANEOUS PROVISIONS.......................................73
SECTION 11.06. REPAYMENT TO THE COMPANY.......................................................74
SECTION 11.07. REINSTATEMENT..................................................................74
ARTICLE 12
SATISFACTION AND DISCHARGE
SECTION 12.01. SATISFACTION AND DISCHARGE OF INDENTURE........................................75
SECTION 12.02. APPLICATION OF TRUST MONEY.....................................................76
ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.01. INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS OF
COMPANY EXEMPT FROM INDIVIDUAL LIABILITY.......................................77
SECTION 13.02. PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES
AND HOLDERS....................................................................77
SECTION 13.03. SUCCESSORS AND ASSIGNS OF COMPANY BOUND BY INDENTURE...........................77
SECTION 13.04. NOTICES AND DEMANDS ON COMPANY, TRUSTEE AND HOLDERS............................77
SECTION 13.05. OFFICER'S CERTIFICATES AND OPINIONS OF COUNSEL;
STATEMENTS TO BE CONTAINED THEREIN.............................................78
SECTION 13.06. PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS................................79
SECTION 13.07. CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST
INDENTURE ACT OF 1939..........................................................79
</TABLE>
iv
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<TABLE>
<CAPTION>
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<S> <C> <C>
SECTION 13.08. NEW YORK LAW TO GOVERN.........................................................80
SECTION 13.09. THIRD PARTY BENEFICIARIES......................................................80
SECTION 13.10. COUNTERPARTS..................................................................80
SECTION 13.11. EFFECT OF HEADINGS.............................................................80
SECTION 13.12. SEVERABILITY...................................................................80
</TABLE>
v
<PAGE>
THIS INDENTURE, dated as of September 27, 1999 among The Home Depot,
Inc., a Delaware corporation (the "COMPANY"), and The Bank of New York, a New
York banking corporation (the "TRUSTEE"),
W I T N E S S E T H :
WHEREAS, the Company has duly authorized the issuance of its 6 1/2%
Senior Notes due September 15, 2004 (the "SECURITIES") and, to provide, among
other things, for the authentication, delivery and administration thereof, the
Company has duly authorized the execution and delivery of this Indenture; and
WHEREAS, the Securities and the Trustee's certificate of authentication
shall be in substantially the following form:
[FORM OF FACE OF SECURITY]
[GLOBAL SECURITIES LEGEND]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, TO THE COMPANY 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 THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR
TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.08 OF THE
INDENTURE.
[RESTRICTED LEGEND]
<PAGE>
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY
BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (i) TO THE COMPANY, (ii) IN THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (iii) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904
UNDER THE SECURITIES ACT, (iv) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE) OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR (v) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (ii)
THROUGH (v) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER
REPRESENTS THAT IT (1) IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT AND IS ACQUIRING THE
NOTES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ONE OR MORE QUALIFIED
INSTITUTIONAL BUYERS AND THAT IT EXERCISES INVESTMENT DISCRETION WITH
RESPECT TO EACH SUCH ACCOUNT, (2) ACQUIRED SUCH SECURITY IN A
TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT,
OR (3) IS NOT A U.S. PERSON AND IS
2
<PAGE>
PURCHASING THE NOTES IN AN OFFSHORE TRANSACTION PURSUANT TO
REGULATION S.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (A)(iv)
ABOVE, THE COMPANY RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH
LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE
REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE
IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
No. $
[CUSIP][CINS]
The Home Depot, Inc.
[ ]% Senior Note Due 200[ ]
The Home Depot, Inc., a Delaware corporation (the "COMPANY"), for value
received hereby promises to pay to or registered assigns the principal sum of
Dollars at the Company's office or agency for said purpose in the City of New
York, on _______ __, 2009, in such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts, and to pay interest, semi-annually on [ ] and [ ]
(each an "INTEREST PAYMENT DATE") of each year, commencing with [ ], 1999, on
said principal sum in like coin or currency at the rate per annum set forth
above at said office or agency from the most recent Interest Payment Date to
which interest on the Securities has been paid or duly provided for, unless the
date hereof is a date to which interest on the Securities has been paid or duly
provided for, in which case from the date of this Security, or, if no interest
on the Securities [or on the Securities for which these Securities were
exchanged pursuant to the Exchange Offer]1 has been paid or duly provided for,
from _______ __, 1999. Notwithstanding the foregoing, if the date hereof is
after [ ] or [ ] (each an "INTEREST RECORD DATE"), as the case may be, and
before the immediately following Interest Payment Date, this Security shall bear
interest from such Interest Payment Date; PROVIDED, that if the Company shall
default in the payment of interest due on such Interest Payment Date then this
Security shall bear interest from the next preceding Interest Payment Date to
which interest on the Securities has been paid or duly provided for. The
interest so payable on
- --------
1 To be included in Exchange Securities.
3
<PAGE>
any Interest Payment Date will, except as otherwise provided in the Indenture
referred to on the reverse hereof, be paid to the person in whose name this
Security is registered at the close of business on the Interest Record Date
preceding such Interest Payment Date whether or not such day is a business day;
PROVIDED that interest may be paid, at the option of the Company, by mailing a
check therefor payable to the registered holder entitled thereto at such
holder's last address as it appears on the Security register or by wire
transfer, in immediately available funds, to such bank or other entity in the
continental United States as shall be designated in writing by such holder prior
to the relevant Interest Record Date and shall have appropriate facilities for
such purpose.
Interest, on the Securities will be computed on the basis of a 360-day
year consisting of twelve months of 30 days each.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Security shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly signed by the Trustee acting under
the Indenture.
4
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
THE HOME DEPOT, INC.
By:
---------------------------------
Name:
Title:
5
<PAGE>
[FORM OF REVERSE OF SECURITY]
The Home Depot, Inc.
[ ]% Senior Note Due 200[ ]
This Security is one of a duly authorized issue of debt securities of
the Company, limited to the aggregate Principal Amount of $___,000,000 (except
as otherwise provided in the Indenture mentioned below), issued or to be issued
pursuant to an indenture dated as of _______ __, 1999 (the "INDENTURE"), duly
executed and delivered by the Company to The Bank of New York, as Trustee
(herein called the "TRUSTEE"). Reference is hereby made to the Indenture and all
indentures supplemental thereto for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders (the words "HOLDERS" or "HOLDER" meaning the registered
holders or registered holder) of the Securities.
This Security will bear interest until final maturity at a rate per
annum shown above, except as provided in the next paragraph. Interest will be
computed on the basis of a 360-day year consisting of twelve months of 30 days
each. The Company will pay interest on overdue principal of, premium, if any,
and to the extent lawful, interest on overdue installments of interest, at the
same rate.
[In the event that a Registration Default (as defined in the
Registration Rights Agreement) occurs, then the Company will pay additional
interest (in addition to the interest otherwise due hereon) ("ADDITIONAL
INTEREST") to the holder during the period immediately following the occurrence
of any such Registration Default in an amount equal to 0.50% per annum
(regardless of the number of Registration Defaults) from and including the date
on which any such Registration Default shall occur (subject to the terms of the
Registration Rights Agreement) to but excluding the date on which all
Registration Defaults have been cured. The Company shall pay amounts due in
respect of Additional Interest on each Interest Payment Date (or, if the Company
shall default in the payment of interest on any Interest Payment Date, on the
date such interest is otherwise paid as provided in the Indenture).]2
[There shall also be payable in respect of this Security all Additional
Interest that may have accrued on the Security for which this Security was
exchanged (as defined in such Security) pursuant to the Exchange Offer, such
Additional Interest
- --------
2 To be included in Initial Securities not Exchange Securities.
6
<PAGE>
to be calculated in accordance with the terms of such Security and payable at
the same time and in the same manner as periodic interest on this Security.]3
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all the Securities may be declared
due and payable, in the manner and with the effect, and subject to the
conditions, provided in the Indenture. The Indenture provides that in certain
events such declaration and its consequences may be waived by the holders of a
majority in aggregate Principal Amount of the Securities then outstanding and
that, prior to any such declaration, such holders may waive any past default
under the Indenture and its consequences except a default in the payment of
principal of, premium, if any, or interest on any of the Securities. Any such
consent or waiver by the holder of this Security (unless revoked as provided in
the Indenture) shall be conclusive and binding upon such holder and upon all
future holders and owners of this Security and any Security which may be issued
in exchange or substitution herefor, whether or not any notation thereof is made
upon this Security or such other Securities.
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee, with the consent of the holders of at least a majority
in aggregate Principal Amount of the Securities at the time outstanding,
evidenced as in the Indenture provided, to execute supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or modifying in any
manner the rights of the holders of the Securities.
Notwithstanding the foregoing, without the consent of any holder of
Securities, the Company and the Trustee may amend or supplement the Indenture or
the Securities to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Securities in addition to or in place of certificated Securities,
to provide for the assumption of the Company's obligations to holders of
Securities in the case of a transaction described in Section 9.01, to make any
change that would provide any additional rights or benefits to the holders of
Securities or that does not adversely affect the legal rights under the
Indenture of any such holder, or to comply with requirements of the Commission
(as defined in the Indenture) in order to effect or maintain the qualification
of the Indenture under the Trust Indenture Act (as defined in the Indenture).
No reference herein to the Indenture and no provision of this Security
shall alter or impair the obligation of the Company, which is absolute and
unconditional,
- --------
3 To be included in Exchange Securities.
7
<PAGE>
to pay the principal of, premium, if any, and interest on this Security at the
place, times, and rate, and in the currency, herein prescribed.
The Securities are issuable only as registered Securities without
coupons in denominations of $1,000 and any multiple of $1,000.
At the office or agency of the Company referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Securities may be exchanged for a like aggregate Principal Amount of Securities
of other authorized denominations.
Upon due presentment for registration of transfer of this Security at
the above-mentioned office or agency of the Company, a new Security or
Securities of authorized denominations, for a like aggregate Principal Amount,
will be issued to the transferee as provided in the Indenture. No service charge
shall be made for any such transfer, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto.
The Securities are redeemable in whole or in part, at the option of the
Company at any time and from time to time, on not less than 30 or more than 60
days' prior notice mailed to the Holders of the Securities, at a Redemption
Price equal to the greater of (i) 100% of the Principal Amount of the Securities
to be redeemed and (ii) the sum of the present values of the Remaining Scheduled
Payments thereon discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus ________ basis points, together in either case with accrued interest
on the Principal Amount being redeemed to the Redemption Date.
Subject to payment by the Company of a sum sufficient to pay the amount
due on redemption, interest on this Security (or portion hereof if this Security
is redeemed in part) shall cease to accrue upon the date duly fixed for
redemption of this Security (or portion hereof if this Security is redeemed in
part).
The Company, the Trustee, and any authorized agent of the Company or
the Trustee, may deem and treat the registered holder hereof as the absolute
owner of this Security (whether or not this Security shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by anyone
other than the Company, the Trustee or any authorized agent of the Company or
the Trustee), for the purpose of receiving payment of, or on account of, the
principal hereof and premium, if any, and, subject to the provisions on the face
hereof, interest hereon and for all other purposes, and none of the Company, the
Trustee nor any authorized agent of the Company or the Trustee shall be affected
by any notice to the contrary.
8
<PAGE>
No recourse shall be had for the payment of the principal of, premium,
if any, or the interest on this Security, for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture or any
indenture supplemental thereto, against any incorporator, shareholder, officer
or director, as such, past, present or future, of the Company or of any
successor corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
The Indenture is hereby incorporated by the reference and to the extent
of any variance between the provisions hereof and the Indenture, the Indenture
shall control. Terms used but not defined herein have the meanings assigned to
such terms in the Indenture.
This Security shall be deemed to be a contract under the laws of the
State of New York, and for all purposes shall be construed in accordance with
the laws of said State, except as may otherwise be required by mandatory
provisions of law.
9
<PAGE>
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
Dated:
------------------------------------
This is one of the Securities described in the within-mentioned Indenture.
The Bank of New York, as Trustee
By:
-------------------------------
Authorized Signatory
10
<PAGE>
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto INSERT TAXPAYER IDENTIFICATION NO.
- -------------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
- --------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing ____________________ attorney to transfer said Security on the
books of the Company with full power of substitution in the premises.
By:
-----------------------------
Date:
---------------------------
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL SECURITIES OTHER THAN EXCHANGE SECURITIES]
In connection with any transfer of this Security occurring prior to the
date which is the earlier of (i) the date of an effective Registration or (ii)
two years (or such lesser period as may be provided in any amendment to Rule
144(k) under the Securities Act) after the later of the original issuance of
this Security or the last date on which this Security was held by the Company or
an Affiliate of the Company, the undersigned confirms that without utilizing any
general solicitation or general advertising that this Security is being
transferred in accordance with its terms:
11
<PAGE>
[CHECK ONE]
(1) / / to the Company; or
(2) / / pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) / / in the United States to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933)
that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that
such transfer is being made in reliance on Rule 144A, in each
case pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
(4) / / outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933; or
(5) / / pursuant to the exemption from registration provided by Rule
144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any Person other
than the registered holder thereof, PROVIDED, HOWEVER, that if box (4) or (5) is
checked, the Trustee may require, prior to registering any such transfer of the
Securities, such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
-----------------------------------------
Signature
Signature Guarantee:
- ---------------------------- -----------------------------------------
Signature must be guaranteed Signature
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
- --------------------------------------------------------------------------------
12
<PAGE>
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:
--------------- --------------------------------------------
NOTICE: To be executed by an executive officer
13
<PAGE>
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been made:
<TABLE>
<CAPTION>
Amount of decrease in Amount of increase in Principal Amount of this Signature of authorized
Date of Principal Amount of this Principal Amount of this Global Security following officer of Trustee or
Exchange Global Security Global Security such decrease or increase Securities Custodian
<S> <C> <C> <C> <C>
</TABLE>
14
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 3.08 of the Indenture; check the box
/ /
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 3.08 of the Indenture, state the amount: $
Date: Your Signature:
-------------------- ----------------------------
Signature Guarantee:
------------------------------
(Signature must be guaranteed)
15
<PAGE>
AND WHEREAS, all things necessary to make the Securities, when executed
by the Company and authenticated and delivered by the Trustee as in the
Indenture provided, the valid, binding and legal obligations of the Company, and
to make the Indenture a valid indenture and agreement according to its terms,
have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the Securities by
the Holders thereof, the Company, and the Trustee mutually covenant and agree
for the equal and proportionate benefit of the respective Holders from time to
time of the Securities as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. CERTAIN TERMS DEFINED. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture which are defined in the Trust Indenture Act of 1939 or
the definitions of which in the Securities Act of 1933 are referred to in the
Trust Indenture Act of 1939 (except as herein otherwise expressly provided or
unless the context otherwise clearly requires), shall have the meanings assigned
to such terms in said Trust Indenture Act and in said Securities Act as in force
at the date of this Indenture. All accounting terms used herein and not
expressly defined shall have the meanings given to them in accordance with GAAP
(whether or not such is indicated herein). 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. The terms
defined in this Article include the plural as well as the singular.
"ADDITIONAL INTEREST" has the meaning provided in the Registration
Rights Agreement.
"AGENT MEMBERS" has the meaning provided in Section 2.07(A).
"ATTRIBUTABLE DEBT" in respect of any Sale and Lease-Back Transaction
means, as of the time of the determination, the lesser of (i) the sale price of
the Principal Property so leased multiplied by a fraction the numerator of which
is the remaining portion of the base term of the lease included in such
transaction and the denominator of which is the base term of such lease, and
(ii) the total
16
<PAGE>
obligation (discounted to present value at the rate of interest implicit in such
transaction compounded semiannually) of the lessee for rental payments (other
than amounts required to be paid on account of property taxes as well as
maintenance, repairs, insurance, water rates and other terms which do not
constitute payments or property rights) during the remaining portion of the base
term of the lease included in such transaction.
"BOARD OF DIRECTORS" means, with respect to any Person, the Board of
Directors of such Person, or any authorized committee of the Board of Directors
of such Person or any officer of such Person duly authorized by the Board of
Directors of such Person to take a specific action.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in the cities of New York or Atlanta are authorized or
obligated by law or executive order to close.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act.
"COMPANY REQUEST" and "COMPANY ORDER" mean, respectively, a written
request or order signed in the name of the Company by its Chairman of the Board,
a Vice Chairman of the Board, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Controller, an Assistant Controller, its
Secretary or an Assistant Secretary, and delivered to the Trustee.
"COMPARABLE TREASURY ISSUE" means the United States Treasury security
selected by an Independent Investment Banker 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 the Securities.
"COMPARABLE TREASURY PRICE" means, with respect to any Redemption Date,
(i) the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Notes" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such business day, (a) the average
of the Reference Treasury Dealer Quotations for such Redemption Date, after
excluding the highest and lowest of such Reference Treasury Dealer Quotations,
or (b) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations.
17
<PAGE>
"CONSOLIDATED CAPITALIZATION" means the total of all of the assets
appearing on the most recent consolidated balance sheet of the Company and its
Subsidiaries, less the following:
(a) current liabilities, including liabilities for
indebtedness maturing more than 12 months from the date of the original
creation thereof, but maturing within 12 months from the date of
determination; and
(b) deferred income taxes.
Consolidated Capitalization shall be determined in accordance with GAAP and may
be determined as of a date not more than 60 days prior to the happening of an
event for which such determination is being made.
"CONSOLIDATED NET TANGIBLE ASSETS" means the total of all assets
appearing on the most recent consolidated balance sheet of the Company and its
Subsidiaries (less depreciation and valuation reserves and other reserves and
items deductible from gross book value of specific asset accounts under GAAP),
after deducting therefrom (a) all current liabilities, including liabilities for
indebtedness maturing more than twelve months from the date of the original
creation thereof but maturing within twelve months from the date of
determination, and (b) all goodwill, trade names, trademarks, patents,
unamortized debt discount, organization expenses, and other like intangibles.
Consolidated Net Tangible Assets shall be determined in accordance with GAAP and
may be determined as of a date not more than 60 days prior to the happening of
an event for which such determination is being made.
"CORPORATE TRUST OFFICE" means the corporate trust office of the
Trustee at which the corporate trust business of the Trustee shall, at any
particular time, be principally administered, which office is, at the date as of
which this Indenture is dated, located at 101 Barclay Street, 21W, New York, New
York 10286, Attention: Corporate Trust Trustee Administration.
"DEFAULT" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"DEPOSITARY" means The Depository Trust Company, its nominees, and
their respective successors.
"EVENT OF DEFAULT" means any event or condition specified as such in
Section 4.01 which shall have continued for the period of time, if any, therein
designated.
18
<PAGE>
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXCHANGE OFFER" means the exchange offer by the Company of Exchange
Securities for Initial Securities pursuant to the Registration Rights Agreement.
"EXCHANGE OFFER REGISTRATION STATEMENT" means a registration statement
relating to an Exchange Offer on an appropriate form and all amendments and
supplements to such registration statement, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
"EXCHANGE SECURITIES" means the debt securities of the Company to be
offered to Securityholders in exchange for Initial Securities pursuant to the
Exchange Offer or otherwise pursuant to a Registration of Exchange Securities
containing terms identical to the Securities for which they are exchanged
(except that (i) interest thereon shall accrue from the last date on which
interest was paid on the Securities or, if no such interest has been paid, from
the date of issuance of the Securities and (ii) the Exchange Securities will
contain the alternative third paragraph appearing on the reverse of the
Securities in the form recited above and will not contain terms with respect to
transfer restrictions).
"FUNDED INDEBTEDNESS" of a corporation means the principal of (a) all
indebtedness created, incurred or assumed by such corporation (including the
Securities in the case of the Company) which by its terms is not payable on
demand and which matures by its terms, or which by its terms such corporation
has the right at its option to renew or extend to a date, more than one year
after the date of determination, whether outstanding on the date of execution of
this Indenture or thereafter created, incurred or assumed, and which is (i) for
money borrowed or (ii) evidenced by a note or similar instrument given in
connection with the acquisition of any business, properties or assets, including
securities, (b) any indebtedness of others of the kinds described in the
preceding clause (a) for the payment of which such corporation is responsible or
liable as guarantor or otherwise and (c) amendments, renewals and refundings of
any such indebtedness; PROVIDED, HOWEVER, that such term shall not include any
obligations under leases or any guarantees of obligations of others under
leases. It is understood that for the purposes of this definition the term
"principal" when used at any date with respect to any indebtedness shall mean
the amount of principal of such indebtedness that could be declared due and
payable on that date pursuant to the terms of such indebtedness.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Issue Date, including those set forth in
the
19
<PAGE>
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entities as have been approved by a significant segment of the accounting
profession.
"GLOBAL SECURITY" has the meaning provided in Section 2.04.
"HOLDER," "HOLDER OF SECURITIES," "SECURITYHOLDER" or other similar
terms mean the registered holder of any Security.
"INDENTURE" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or
supplemented.
"INDEPENDENT INVESTMENT BANKER" means one of the Reference Treasury
Dealers appointed by the Company.
"INITIAL PURCHASERS" means Credit Suisse First Boston Corporation and
Invemed Associates LLC.
"INITIAL SECURITIES" means the Securities issued under this Indenture
which are not Exchange Securities.
"INTEREST PAYMENT DATE" means each semiannual interest payment date on
September 15 and March 15 of each year, commencing March 15, 2000.
"INTEREST RECORD DATE" for the Interest payable on any Interest Payment
Date (except a date for payment of defaulted interest) means the September 1 or
March 1 (whether or not a Business Day) as the case may be, next preceding such
Interest Payment Date.
"ISSUE DATE" means the original issue date of the Securities.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on the
business, assets, financial condition or results of operations of the Company
(taken together with its Subsidiaries as a whole).
"OFFICER'S CERTIFICATE" means a certificate signed by the Chairman of
the Board, any Vice Chairman of the Board, the President or any Vice President
of the Company, and by the Treasurer, an Assistant Treasurer, the Controller, an
Assistant Controller, the Secretary or an Assistant Secretary of the Company,
and delivered to the Trustee. Each such certificate shall comply with Section
314 of
20
<PAGE>
the Trust Indenture Act of 1939 and include the statements provided for in
Section 13.05.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Company or who may be other
counsel satisfactory to the Trustee. Each such opinion shall comply with Section
314 of the Trust Indenture Act and include the statements provided for in
Section 13.05, and such others as may reasonably be requested by the Trustee, if
and to the extent required hereby.
"OUTSTANDING", when used with reference to Securities, subject to the
provisions of Article 6 means, as of any particular time, all Securities
authenticated and delivered by the Trustee under this Indenture, except
(a) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside, segregated and held in trust by
the Company (if the Company shall act as its own paying agent),
PROVIDED that if such Securities are to be redeemed prior to the
maturity thereof, notice of such redemption shall have been given as
herein provided, or provision satisfactory to a Responsible Officer of
the Trustee shall have been made for giving such notice; and
(c) Securities in substitution for which other Securities shall
have been authenticated and delivered, or which shall have been paid,
pursuant to the terms of Section 2.09 (unless proof satisfactory to the
Trustee and the Company is presented that any of such Securities is
held by a person in whose hands such Security is a legal, valid and
binding obligation of the Company).
"PERSON" means any individual, corporation, partnership, joint stock
company, business trust, trust, unincorporated association, joint venture or
other entity or organization, including a government or political subdivision or
an agency or instrumentality thereof.
"PHYSICAL SECURITIES" means Securities issued pursuant to Section 2.01
in exchange for interests in the Global Security or pursuant to Section 2.07(B)
in registered form substantially in the form hereinabove recited.
21
<PAGE>
"PRINCIPAL" wherever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "AND PREMIUM, IF
ANY."
"PRINCIPAL AMOUNT" means, when used with respect to any Security, the
amount of principal of such Security that could then be declared due and payable
pursuant to Section 4.02.
"PRINCIPAL PROPERTY" means all real property and tangible personal
property owned by the Company or a Subsidiary constituting a part of any store,
warehouse or distribution center located within one of the 50 states of the
United States or the District of Columbia, exclusive of motor vehicles, mobile
materials-handling equipment and other rolling stock, cash registers and other
point of sale recording devices and related equipment, and data processing and
other office equipment; PROVIDED, HOWEVER, that such term shall not include any
such property constituting a part of any such store, warehouse or distribution
center unless the net book value of all real property (including leasehold
improvements) and tangible personal property constituting a part of such store,
warehouse or distribution center exceeds 0.25% of Consolidated Capitalization.
"PRIVATE PLACEMENT LEGEND" means the legend initially set forth on the
Securities in the form set forth in Section 2.05(A).
"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 (including premium, if any) at which it is to be
redeemed pursuant to this Indenture.
"REFERENCE TREASURY DEALER" means Credit Suisse First Boston
Corporation and its respective successors and two other nationally recognized
investment banking firms that are Primary Treasury Dealers specified from time
to time by the Company; PROVIDED, HOWEVER, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"PRIMARY TREASURY DEALER"), the Company shall designate as a substitute another
nationally recognized investment banking firm that is a Primary Treasury Dealer.
"REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Trustee, 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
22
<PAGE>
to the Trustee by such Reference Treasury Dealer as of 3:30 p.m., New York City
time, on the third Business Day preceding such Redemption Date.
"REMAINING SCHEDULED PAYMENTS" means, with respect to each Security to
be redeemed, the remaining scheduled payments of the principal thereof and
interest thereon that would be due after the related Redemption Date but for
such redemption, except that, if such Redemption Date is not an interest payment
date with respect to such Security, the amount of the next succeeding scheduled
interest payment thereon shall be reduced by the amount of interest accrued
thereon to such Redemption Date.
"REGISTRAR" has the meaning provided in Section 2.06.
"REGISTRATION" means a registered exchange offer for the Securities by
the Company or other registration of the Securities under the Securities Act
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of September 27, 1999, among the Company and the Initial
Purchasers and certain permitted assigns specified therein.
"REGISTRATION STATEMENT" means the Registration Statement pursuant to
and as defined in the Registration Rights Agreement.
"REGULATION S" means Regulation S under the Securities Act.
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
officer within the corporate trust department of the Trustee including any vice
president, any trust officer, any assistant vice president, any assistant
secretary, any assistant treasurer, or any other officer of the Trustee
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of his or her knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the
administration of this Indenture.
"RESTRICTED LEGEND" means the legend set forth in Section 2.05 hereof.
"RULE 144A" means Rule 144A under the Securities Act.
"SALE AND LEASE-BACK TRANSACTION" of the Company or any Subsidiary
means any arrangement whereby (a) property has been or is to be sold or
transferred by the Company or any Subsidiary to any Person with the intention on
the part of the Company or any Subsidiary of taking back a lease of such
property
23
<PAGE>
pursuant to which the rental payments are calculated to amortize the purchase
price of such property substantially over the useful life of such property, (b)
such property is in fact so leased by the Company or any Subsidiary, and (c) the
commitment by or on behalf of the purchaser or transferee is obtained more than
twelve months after the later of (i) the completion of the acquisition,
substantial repair or alteration, construction, development or substantial
improvement of such property or (ii) the placing in operation of such property
or of such property as so substantially repaired or altered, constructed,
developed or substantially improved.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITY" or "SECURITIES" means any Security or Securities, as the
case may be, authenticated and delivered under this Indenture. For all purposes
of this Indenture, the term "Securities" shall include the Initial Securities
and any Exchange Securities to be issued and exchanged for any Initial
Securities pursuant to the Registration Rights Agreement and this Indenture and,
for purposes of this Indenture, all Initial Securities and Exchange Securities
shall vote together as one series of Securities under this Indenture.
"SECURITY REGISTER" has the meaning provided in Section 2.06.
"SENIOR FUNDED INDEBTEDNESS" of the Company means any Funded
Indebtedness of the Company unless in any instrument or instruments evidencing
or securing such Funded Indebtedness or pursuant to which the same is
outstanding, or in any amendment, renewal, extension or refunding of such Funded
Indebtedness, it is provided that such Funded Indebtedness is subordinate in
right of payment to the Securities (a) in the event of any dissolution or
winding-up or total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary, or any bankruptcy, insolvency, receivership or
similar proceedings relative to the Company, (b) in the event that any
Subordinated Funded Indebtedness of the Company is declared due and payable
before its expressed maturity because of the occurrence of an event of default
with respect to such Subordinated Funded Indebtedness and (c) in the event of
any default in the payment of principal (including any required prepayments or
amortization) of or interest on any Senior Funded Indebtedness of the Company.
"Senior Funded Indebtedness" of a Subsidiary means any Funded Indebtedness of
such Subsidiary and the aggregate preference on involuntary liquidation of any
class of stock of such Subsidiary ranking, either as to payment of dividends or
distribution of assets, prior to any other class of stock of such Subsidiary.
"SUBSIDIARY"means, as applied, with respect to any Person, any
corporation, partnership or other legal entity of which, in the case of a
24
<PAGE>
corporation, more than 50% of the issued and outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation has or might have voting power upon the
occurrence of any contingency), or, in the case of any partnership or other
legal entity, more than 50% of the ordinary equity capital interests, is at the
time directly or indirectly owned or controlled by such Person, by such Person
and one or more of its other Subsidiaries or by one or more of such Person's
other Subsidiaries.
"TREASURY RATE" means, with respect to any Redemption Date, the rate
per annum equal to the semiannual equivalent yield to maturity (computed as of
the second business day immediately preceding such Redemption Date) 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.
"TRUST INDENTURE ACT OF 1939" means the Trust Indenture Act of 1939, as
amended, as in force at the date as of which this Indenture was originally
executed, and "TIA", when used in respect of an indenture supplemental hereto,
means such Act as in force at the time such indenture supplemental hereto
becomes effective.
"TRUSTEE" means the entity identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Five, shall also
include any successor trustee.
SECTION 1.02. OTHER DEFINITIONS.
<TABLE>
<CAPTION>
DEFINED IN
TERM SECTION
- ---- -------
<S> <C>
"Covenant Defeasance".............................................. 11.03
"Legal Defeasance"................................................. 11.02
</TABLE>
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES
SECTION 2.01. AUTHENTICATION AND DELIVERY OF SECURITIES. Upon the
execution and delivery of this Indenture, or from time to time thereafter,
Securities (including Exchange Securities) in an aggregate Principal Amount not
in excess of the amount specified in the form of Security hereinabove recited
25
<PAGE>
(except as otherwise provided in Section 2.09) may be executed by the Company
and delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and make available for delivery said Securities to or upon the
written order of the Company, signed by its Chairman of the Board of Directors,
or any Vice Chairman of the Board of Directors, or its President or any Vice
President (whether or not designated by a number or numbers or a word or words
added before or after the title "Vice President") without any further action by
the Company.
SECTION 2.02. EXECUTION OF SECURITIES. The Securities shall be signed
on behalf of the Company by its Chairman of the Board of Directors or any Vice
Chairman of the Board of Directors or its President or any Vice President
(whether or not designated by a number or numbers or a word or words added
before or after the title "Vice President"). Such signatures may be the manual
or facsimile signatures of the present or any future such officers.
In case any officer of the Company who shall have signed any of the
Securities shall cease to be such officer before the Security so signed shall be
authenticated and delivered by the Trustee or disposed of by the Company, such
Security nevertheless may be authenticated and delivered or disposed of as
though the person who signed such Security had not ceased to be such officer of
the Company, as the case may be; and any Security may be signed on behalf of the
Company by such persons as, at the actual date of the execution of such Security
shall be the proper officers of the Company, as the case may be, although at the
date of the execution and delivery of this Indenture any such person was not
such officer.
SECTION 2.03. CERTIFICATE OF AUTHENTICATION. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinabove recited, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon any
Security executed by the Company shall be conclusive evidence that the Security
so authenticated has been duly authenticated and delivered hereunder and that
the Holder is entitled to the benefits of this Indenture.
SECTION 2.04. FORM, DENOMINATION AND DATE OF SECURITIES; PAYMENTS OF
INTEREST. The Securities and the Trustee's certificates of authentication shall
be substantially in the form recited above; PROVIDED that Exchange Securities
(i) shall contain the alternative third paragraph appearing on the reverse of
the Securities in the form recited above and (ii) shall not contain terms with
respect to transfer restrictions. The Securities shall be issuable in
denominations provided for in the form of Security recited above. The Securities
shall be numbered, lettered, or
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otherwise distinguished in such manner or in accordance with such plans as the
officers of the Company executing the same may determine with the approval of
the Trustee.
Any of the Securities may be issued with appropriate insertions,
omissions, substitutions and variations, and may have imprinted or otherwise
reproduced thereon such legend or legends, not inconsistent with the provisions
of this Indenture, as may be required to comply with any law or with any rules
or regulations pursuant thereto, including those required by Section 2.05, or
with the rules of any securities market in which the Securities are admitted to
trading, or to conform to general usage.
Each Security shall be dated the date of its authentication, shall bear
interest from the applicable date and shall be payable on the dates specified on
the face of the form of Security recited above.
Securities offered and sold in reliance on Section 4(2) and Rule 144A
shall be issued initially in the form of a single permanent global Security in
registered form, substantially in the form hereinabove recited (each, a "GLOBAL
SECURITY"), deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as herein provided. The
aggregate principal amount of the Global Security 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.
The person in whose name any Security is registered at the close of
business on any Interest Record Date with respect to any Interest Payment Date
shall be entitled to receive the interest, if any, payable on such Interest
Payment Date notwithstanding any transfer or exchange of such Security
subsequent to the Interest Record Date and prior to such Interest Payment Date,
except if and to the extent the Company shall default in the payment of the
interest due on such Interest Payment Date, in which case such defaulted
interest, plus (to the extent lawful) any interest payable on the defaulted
interest, shall be paid to the persons in whose names outstanding Securities are
registered at the close of business on a subsequent record date (which shall be
not less than five Business Days prior to the date of such payment) established
by notice given by mail by or on behalf of the Company to the holders of
Securities not less than 15 days preceding such subsequent record date.
SECTION 2.05. RESTRICTIVE LEGENDS. (a) Except as otherwise provided in
paragraph (c), each Global Security shall bear the following legend on the face
thereof:
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THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF
THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY
BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (i) TO THE COMPANY, (ii) IN THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (iii) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904
UNDER THE SECURITIES ACT, (iv) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE) OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR (v) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (ii)
THROUGH (v) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER
REPRESENTS THAT IT (1) IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT AND IS ACQUIRING THE
NOTES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ONE OR MORE QUALIFIED
INSTITUTIONAL BUYERS AND THAT IT EXERCISES INVESTMENT DISCRETION WITH
RESPECT TO EACH SUCH ACCOUNT, (2) ACQUIRED SUCH SECURITY IN A
TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT
OR (3) IS NOT A U.S. PERSON AND
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IS PURCHASING THE NOTES IN AN OFFSHORE TRANSACTION PURSUANT TO
REGULATION S.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (A)(iv)
ABOVE, THE COMPANY RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH
LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE
REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE
IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
(b) Each Global Security shall also bear the following legend on the
face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, TO THE COMPANY 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 THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR
TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.08 OF THE
INDENTURE.
(c) (i) If the Company determines (upon the advice of counsel and
such other certifications and evidence as the Company may
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reasonably require) that any Security is eligible for resale pursuant
to Rule 144(k) under the Securities Act (or a successor provision) and
that the Restricted Legend is no longer necessary or appropriate in
order to ensure that subsequent transfers of such Security (or a
beneficial interest therein) are effected in compliance with the
Securities Act, or
(ii) after an Initial Security is (x) sold pursuant to an
effective registration statement under the Securities Act, pursuant to
the Registration Rights Agreement or otherwise, or (y) exchanged for an
Exchange Security,
the Company may instruct the Trustee to cancel such Security and issue to the
Holder thereof (or to its transferee) a new Security of like tenor and amount,
registered in the name of the Holder thereof (or its transferee), that does not
bear the Restricted Legend, and the Trustee will comply with such instruction.
SECTION 2.06. REGISTRATION, TRANSFER AND EXCHANGE. The Securities are
issuable only in registered form. The Company will keep at each office or agency
(the "REGISTRAR") a register or registers (the "SECURITY REGISTER(S)") in which,
subject to such reasonable regulations as it may prescribe, it will register,
and will register the transfer of, Securities as in this Article provided. Such
Security Register or Security Registers shall be in written form in the English
language or in any other form capable of being converted into such form within a
reasonable time. At all reasonable times such Security Register or Security
Registers shall be open for inspection by the Trustee.
Upon due presentation for registration of transfer of any Security at
each such office or agency, the Company shall execute and the Trustee shall
authenticate and make available for delivery in the name of the transferee or
transferees a new Security or Securities, in each case, in authorized
denominations for a like aggregate Principal Amount.
A Holder may transfer a Security only by written application to the
Registrar stating the name of the proposed transferee and otherwise complying
with the terms of this Indenture. No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the Security
Register. Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any agent of the Company shall treat the
person in whose name the Security is registered as the owner thereof for all
purposes whether or not the Security shall be overdue, and neither the Company,
the Trustee, nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a
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Global Security shall, by acceptance of such Global Security, agree that
transfers of beneficial interests in such Global Security may be effected only
through a book entry system maintained by the Holder of such Global Security (or
its agent) and that ownership of a beneficial interest in the Security shall be
required to be reflected in a book entry. When Securities are presented to the
Registrar or a co-Registrar with a request to register the transfer or to
exchange them for an equal Principal Amount of Securities of other authorized
denominations (including an exchange of Initial Securities for Exchange
Securities), the Registrar shall register the transfer or make the exchange as
requested if the requirements for such transactions set forth herein are met;
PROVIDED that no exchanges of Initial Securities for Exchange Securities shall
occur until a Registration Statement shall have been declared effective by the
Commission and that any Initial Securities that are exchanged for Exchange
Securities shall be cancelled by the Trustee. To permit registrations of
transfers and exchanges, the Company shall execute and the Trustee shall
authenticate Securities at the Registrar's request.
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 exchange or
registration of transfer of Securities (other than any such transfer taxes or
other similar governmental charge payable upon exchanges pursuant to Section
2.11, 8.05 or 10.03). No service charge to any Holder shall be made for any such
transaction.
The Company shall not be required to exchange or register a transfer of
(a) any Securities for a period of 15 days next preceding the first mailing of
notice of redemption of Securities to be redeemed, or (b) any Securities
selected, called or being called for redemption except, in the case of any
Security where public notice has been given that such Security is to be redeemed
in part, the portion thereof not so to be redeemed.
All Securities issued upon any transfer or exchange of Securities shall
be valid obligations of the Company, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Securities surrendered upon such
transfer or exchange.
SECTION 2.07. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES. (a) Each
Global Security initially shall (i) be registered in the name of the Depositary
for such Global Securities or the nominee of such Depositary, (ii) be delivered
to the Trustee as custodian for such Depositary and (iii) bear legends as set
forth in Section 2.05.
Members of, or participants in, the Depositary ("AGENT MEMBERS") shall
have no rights under this Indenture with respect to any Global Security held on
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their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Security, and the Depositary may be treated by the Company, 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 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 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) Transfers of a Global Security shall be limited to transfers of
such Global Security in whole, but not in part, to the Depositary, its
successors or their respective nominees. If at any time the Depositary notifies
the Company that it is unwilling or unable to continue as Depositary or if at
any time the Depositary shall no longer be qualified to serve as the Depositary,
the Company shall appoint a successor depositary with respect to the Securities.
If a successor depositary is not appointed by the Company within 90 days after
the Company receives such notice or becomes aware of such ineligibility, the
Trustee, upon receipt of a Company Order for the authentication and delivery of
definitive Securities, will authenticate and deliver Securities of like tenor
and terms in definitive form in an aggregate Principal Amount equal to the
Principal Amount of the Global Securities or Securities in exchange for such
Global Security or Securities.
The Company may at any time and in its sole discretion determine that
the Securities issued in the form of one or more Global Securities shall no
longer be represented by such Global Securities. In such event, the Company will
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive Securities, will authenticate and deliver Securities
of like tenor and terms in definitive form in an aggregate Principal Amount
equal to the Principal Amount of the Global Security or Securities in exchange
for such Global Security or Securities. Interests of beneficial owners in a
Global Security may be transferred in accordance with the rules and procedures
of the Depositary and the provisions of Section 2.08. In addition, Physical
Securities shall be transferred to all beneficial owners in exchange for their
beneficial interests in a Global Security, if (i) the Depositary (A) notifies
the Company that it is unwilling or unable to continue as Depositary for such
Global Security, and a successor depositary is not appointed by the Company
within 90 days of such notice (B) ceases to be qualified to serve as Depositary
and a successor depositary is not appointed by the Company within 90 days of
such notice, (ii) the Company executes and delivers to the Trustee a Company
Order that such Global Security shall be so transferable, registrable and
exchangeable, and such transfers shall be registrable, or (iii) an Event of
Default of which the Trustee has actual notice has
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occurred and is continuing and the Registrar has received a request from the
Depositary to issue such Physical Securities.
(c) Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon transfer, cease to be an interest in such
Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions, if any,
and other procedures applicable to beneficial interests in such other Global
Security for as long as it remains such an interest.
(d) In connection with any transfer of a portion of the beneficial
interests in a Global Security to beneficial owners pursuant to paragraph (b) of
this Section 2.07, the Registrar shall reflect on its books and records the date
and a decrease in the Principal Amount of such Global Security in an amount
equal to the Principal Amount of the beneficial interest in such Global Security
to be transferred, and the Company shall execute, and the Trustee shall
authenticate and make available for delivery, one or more Physical Securities of
like tenor and amount.
(e) In connection with the transfer of an entire Global Security to
beneficial owners pursuant to paragraph (b) of this Section, such Global
Security shall be deemed to be surrendered to the Trustee for cancellation, and
the Company shall execute, and the Trustee shall authenticate and deliver, to
each beneficial owner identified by the Depositary in exchange for its
beneficial interest in such Global Security, an equal Principal Amount of
Physical Securities of authorized denominations.
(f) Any Physical Security delivered in exchange for an interest in a
Global Security pursuant to paragraph (b) or (d) of this Section shall, except
as otherwise provided by Section 2.04, bear the legend regarding transfer
restrictions applicable to the Physical Security set forth in Section 2.05.
(g) The registered holder of a Global Security may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
SECTION 2.08. SPECIAL TRANSFER PROVISIONS. Unless and until an Initial
Security is exchanged for an Exchange Security in connection with an effective
Registration pursuant to the Registration Rights Agreement, the following
provisions shall apply:
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(a) The transfer or exchange of any Security (or a beneficial interest
therein) that bears the Restricted Legend may only be made in compliance with
the provisions of the Restricted Legend.
(b) The Trustee will retain copies of all certificates, opinions and
other documents received in connection with the transfer or exchange of a
Security (or a beneficial interest therein), and the Company will have the right
to inspect and make copies thereof at any reasonable time upon written notice to
the Trustee.
(c) 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 Registrar shall not register a transfer of any Security unless
such transfer complies with the restrictions on transfer of such Security set
forth in this Indenture. In connection with any transfer of Securities, each
Holder agrees by its acceptance of the Securities to furnish the Registrar or
the Company such certifications, legal opinions or other information as either
of them may reasonably require to confirm that such transfer is being made
pursuant to an exemption from, or a transaction not subject to, the registration
requirements of the Securities Act; PROVIDED that the Registrar shall not be
required to determine (but may rely on a determination made by the Company with
respect to) the sufficiency of any such certifications, legal opinions or other
information.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.07(A) or this Section
2.08. 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 Registrar.
Each Holder of a Security agrees to indemnify the Company and the
Trustee against any liability that may result from the transfer, exchange or
assignment of such Holder's Security in violation of any provision of this
Indenture and/or applicable United States Federal or state securities law.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Agent Members or
beneficial owners of interests in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this
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Indenture, and to examine the same to determine substantial compliance as to
form with the express requirements hereof.
SECTION 2.09. MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN
SECURITIES. In case any temporary or definitive Security shall become mutilated,
defaced or be apparently destroyed, lost or stolen, the Company in its
discretion may execute, and upon the written request of any officer of the
Company, the Trustee shall authenticate and make available for delivery, a new
Security bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated or defaced Security, or in lieu of and
substitution for the Security so apparently destroyed, lost or stolen. In every
case the applicant for a substitute Security shall furnish to the Company and
the Trustee and any agent of the Company or the Trustee such security or
indemnity as may be required by each of them to indemnify and defend and to save
each of them harmless and, in every case of destruction, loss or theft evidence
to their satisfaction of the apparent destruction, loss or theft of such
Security and of the ownership thereof.
Upon the issuance of any substitute Security, 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. In case any Security
which has matured or is about to mature, or has been called for redemption in
full, shall become mutilated or defaced or be apparently destroyed, lost or
stolen, the Company may, instead of issuing a substitute Security, pay or
authorize the payment of the same (without surrender thereof except in the case
of a mutilated or defaced Security), if the applicant for such payment shall
furnish to the Company and to the Trustee and any agent of the Company or the
Trustee such security or indemnity as any of them may require to save each of
them harmless from all risks, however remote, and, in every case of apparent
destruction, loss or theft, the applicant shall also furnish to the Company and
the Trustee and any agent of the Company or the Trustee evidence to their
satisfaction of the apparent destruction, loss or theft of such Security and of
the ownership thereof.
Every substitute Security issued pursuant to the provisions of this
Section by virtue of the fact that any Security is apparently destroyed, lost or
stolen shall constitute an additional contractual obligation of the Company
whether or not the apparently destroyed, lost or stolen Security shall be at any
time enforceable by anyone and shall be entitled to all the benefits of (but
shall be subject to all the limitations of rights set forth in) this Indenture
equally and proportionately with any and all other Securities duly authenticated
and delivered hereunder. All Securities shall be held and owned upon the express
condition that, to the extent permitted by law, the foregoing provisions are
exclusive with respect to the replacement or payment of mutilated, defaced, or
apparently destroyed, lost or
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stolen Securities and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.10. CANCELLATION OF SECURITIES. All Securities surrendered
for payment, redemption, registration of transfer or exchange, if surrendered to
the Company or any agent of the Company or the Trustee, shall be delivered to
the Trustee for cancellation or, if surrendered to the Trustee, shall be
cancelled by it; and no Securities shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. The Trustee
shall dispose of cancelled Securities in accordance with its customary
procedures. If the Company shall acquire any of the Securities, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless and until the same are delivered to the
Trustee for cancellation.
SECTION 2.11. TEMPORARY SECURITIES. Pending the preparation of
definitive Securities, the Company may execute and the Trustee shall
authenticate and make available for delivery temporary Securities (printed,
lithographed, typewritten or otherwise reproduced, in each case in form
satisfactory to the Trustee). Temporary Securities shall be issuable as
registered Securities without coupons, of any authorized denomination, and
substantially in the form of the definitive Securities but with such omissions,
insertions and variations as may be appropriate for temporary Securities, all as
may be determined by the Company with the concurrence of the Trustee. Temporary
Securities may contain such reference to any provisions of this Indenture as may
be appropriate. Every temporary Security shall be executed by the Company and be
authenticated by the Trustee upon the same conditions and in substantially the
same manner, and with like effect, as the definitive Securities. Without
unreasonable delay the Company shall execute and shall furnish definitive
Securities and thereupon temporary Securities may be surrendered in exchange
therefor without charge at each office or agency to be maintained by the Company
for the purpose pursuant to Section 3.02, and the Trustee shall authenticate and
make available for delivery in exchange for such temporary Securities a like
aggregate principal amount of definitive Securities of authorized denominations.
Until so exchanged the temporary Securities shall be entitled to the same
benefits under this Indenture as definitive Securities.
SECTION 2.12. CUSIP AND CINS NUMBERS. The Company in issuing the
Securities may use "CUSIP" and "CINS" numbers (if then generally in use), and
the Trustee shall use CUSIP numbers or CINS numbers, as the case may be, in
notices of redemption or exchange as a convenience to Holders; PROVIDED that any
such notice shall state that no representation is made as to the correctness of
such
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numbers either as printed on the Securities or as contained in any notice of
redemption or exchange and that reliance may be placed only on the other
identification numbers printed on the Securities and any such redemption shall
not be affected by any defect in or omission of such numbers. The Company shall
promptly notify the Trustee of any change in the CUSIP numbers or CINS numbers.
ARTICLE 3
CERTAIN COVENANTS
SECTION 3.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST ON SECURITIES.
The Company, for the benefit of the Securities, will duly and punctually pay or
cause to be paid the principal of and any premium and interest on the Securities
in accordance with the terms of the Securities and this Indenture.
SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Company will
maintain a Payment Office where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer or
exchange, and where notices and demands to or upon the Company in respect of the
Securities 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, and the Company hereby initially
appoints the Trustee at its office or agency as its agent to receive all such
presentations, surrenders, notices and demands.
SECTION 3.03. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.
(a) If the Company shall at any time act as its own Paying Agent with
respect to the Securities, it will, on or before each due date of the principal
of or any premium or interest on the Securities, 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.
(b) Whenever the Company shall have one or more Paying Agents for the
Securities, it will, prior to each due date of the principal of or any premium
or
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interest on the Securities, 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.
(c) The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent will
agree with the Trustee, subject to the provisions of this Section 3.03, that
such Paying Agent will (i) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent (ii) hold all sums held by it for the payment
of the principal of (and premium, if any) or interest, if any, on the Securities
in trust for the benefit of the Holders until such sums shall be paid to such
Holders or otherwise disposed of as herein provided; (iii) give the Trustee
notice of any default by the Company (or any other obligor upon the Securities)
in the making of any payment of principal (and premium, if any) or interest, if
any, on the Securities; and (iv) during the continuance of any default by the
Company (or any other obligor upon the Securities) in the making of any payment
in respect of the Securities, and upon the written request of that Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities.
(d) 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 will be released from all further liability with respect to
such money.
(e) 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 and remaining unclaimed for two years after such
principal, premium, or interest has become due and payable will be paid to the
Company upon a Company Request (or, if then held by the Company, will be
discharged from such trust); and the Holder of such Security will 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, will 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
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City of New York, notice that such money remains unclaimed and that, after a
date specified therein, which will not be less than 30 calendar days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 3.04. EXISTENCE. Subject to Article 9, 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 will not be required to preserve any such right or
franchise if the Board of Directors determines that the preservation thereof is
no longer desirable in the conduct of the business of the Company and that the
loss thereof will not result in a Material Adverse Effect.
SECTION 3.05. STATEMENT BY OFFICERS AS TO DEFAULT. The Company will
deliver to the Trustee, within 120 calendar days after the end of each fiscal
year of the Company ending after the date hereof, an Officer's Certificate
signed by the principal executive officer, principal financial officer, or
principal accounting officer of the Company stating whether or not to the
knowledge of such person after due inquiry 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 is in default, specifying all such
defaults and the nature and status thereof of which such person may have such
knowledge. The Company shall deliver to the trustee, as soon as possible and in
any event within five days after the Company becomes aware of the occurrence of
any Event of Default or an event which, with notice or the lapse of time or
both, would constitute an Event of Default, an Officers' Certificate setting
forth the details of such Event of Default or default and the action which the
Company proposes to take with respect thereto.
SECTION 3.06. WAIVER OF CERTAIN COVENANTS. The Company may omit in any
particular instance to comply with any term, provision, or condition set forth
in Section 3.04 and the provisions of any supplemental indenture specified in
such supplemental indenture, with respect to the Securities if the Holders of a
majority in Principal Amount of the outstanding Securities 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 will
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 will remain in full force and effect.
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SECTION 3.07. LIMITATIONS ON LIENS. (a) The Company will not, and will
not permit any Subsidiary to, issue, assume or guarantee any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed (herein
referred to as "indebtedness") secured by any mortgage, security interest,
pledge or lien (herein referred to as "mortgage") of or upon any Principal
Property, or of or upon shares of capital stock or evidences of indebtedness of
any Subsidiary that owns any Principal Property, whether such Principal
Property, shares of capital stock or evidences of indebtedness are owned at the
date of this Indenture or thereafter acquired, without making effective
provision, and the Company in each case will make or cause to be made effective
provision, whereby the Principal Amount of all of the Securities from time to
time outstanding shall be secured equally and ratably with (or at the option of
the Company, prior to) such mortgage; PROVIDED, HOWEVER, that this Section 3.07
shall not apply to indebtedness secured by any of the following:
(i) mortgages existing on the date hereof;
(ii) mortgages on any property existing at the time of
acquisition thereof;
(iii) mortgages on property, shares of capital stock or evidences
of indebtedness of a corporation existing at the time such corporation
is merged into or consolidated with, or disposes of substantially all
of its properties (or those of a division) to, the Company or a
Subsidiary;
(iv) mortgages on property of a corporation, shares of capital
stock or evidences of indebtedness of any corporation existing at the
time such corporation becomes a Subsidiary;
(v) mortgages securing indebtedness of a Subsidiary to the
Company or to another Subsidiary;
(vi) mortgages on property to secure the cost of acquisition,
construction, development or substantial repair, alteration or
improvement of such property, provided the commitment of the creditor
to extend the credit secured by any such mortgage shall have been
obtained not later than sixty months after the later of (A) the
completion of the acquisition, construction, development, substantial
repair, alteration or improvement of such property or (B) the placing
in operation of such property as so acquired, constructed, developed or
substantially repaired, altered or improved;
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(vii) mortgages securing current liabilities payable on demand or
not more than one year after the date as of which the determination is
made (excluding any indebtedness renewable or extendable at the option
of the debtor for a period or periods ending more than one year after
the date as of which such determination is made), which indebtedness in
accordance with generally accepted accounting practices would be
included among current liabilities;
(viii) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any
mortgage referred to in the foregoing clauses (i) to (vii) inclusive;
provided, however, that the principal amount of indebtedness secured
thereby and not otherwise authorized by said clauses (i) to (vii)
inclusive shall not exceed the principal amount of indebtedness, plus
any premium or fee payable in connection with any such extension,
renewal or replacement, so secured at the time of such extension,
renewal or replacement;
(ix) mortgages 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, to secure partial progress, advance or other payments pursuant
to any contract or statute or to secure any indebtedness incurred for
the purpose of financing all or any part of the purchase price or the
cost of constructing or improving the property subject to such
mortgages;
(x) mortgages arising out of any final judgment for the payment
of money aggregating not in excess of $10,000,000 or mortgages created
by or relating to any legal proceeding or final judgment which at the
time is being contested in good faith by appropriate proceedings,
provided enforcement of any mortgage has been stayed; or
(xi) mortgages for taxes or other governmental charges either
not yet delinquent or the nonpayment of which is being contested in
good faith by appropriate proceedings; mortgages comprising landlord's
liens or liens of carriers, warehousemen, mechanics or materialmen
incurred in the ordinary course of business for sums not yet due and
payable or which are being contested in good faith by appropriate
proceedings; and any other mortgages incurred or created in the
ordinary course of business not arising in connection with indebtedness
that do not in the aggregate materially impair the use or value of the
properties or assets of the Company and its Subsidiaries, taken as a
whole.
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(b) Notwithstanding the provisions of Section 3.07(A), the Company or
any of its Subsidiaries may, however, issue, assume or guarantee indebtedness
secured by mortgages which would otherwise be subject to the restrictions of
Section 3.07(A) in an aggregate amount which, together with all Attributable
Debt outstanding pursuant to Section 3.08(B) and all indebtedness outstanding
pursuant to this Section 3.07(B), does not at the time exceed the greater of 10%
of all Consolidated Net Tangible Assets or 15% of Consolidated Capitalization.
SECTION 3.08. LIMITATIONS ON SALE AND LEASEBACK TRANSACTIONS. (a) The
Company will not, nor will it permit any Subsidiary to, enter into any Sale and
Lease-Back Transaction with respect to any Principal Property (except for
transactions providing for a lease for a term, including any renewal thereof, of
not more than 48 months and except for a transaction between the Company and a
Subsidiary or between Subsidiaries), unless either (x) the Company or such
Subsidiary would be entitled pursuant to Section 3.07(A) to issue, assume or
guarantee evidences of indebtedness secured by a mortgage on such Principal
Property in an amount at least equal to the Attributable Debt in respect of such
Sale and Lease-Back Transaction without being required by Section 3.07(A) to
equally and ratably secure the Principal Amount of the Securities from time to
time outstanding or (y) the Company shall apply or cause to be applied, in the
case of a sale or transfer for cash, an amount equal to the net proceeds thereof
(but not in excess of the net book value of such Principal Property at the date
of such sale or transfer) and, in the case of a sale or transfer otherwise than
for cash, an amount equal to the fair value (as determined by the Board of
Directors) of the Principal Property so leased (x) to the retirement, within one
year after the effective date of such Sale and Lease-Back Transaction, of
Securities or other Senior Funded Indebtedness of the Company or a Subsidiary;
PROVIDED, HOWEVER, that any such retirement of Securities shall be in accordance
with Article 10 and any other terms and provisions of this Indenture and the
Securities applicable to optional redemption of Securities and, provided
further, that the amount to be applied to such retirement of Securities or other
Senior Funded Indebtedness shall be reduced by an amount equal to the sum of (A)
an amount equal to the applicable Redemption Price with respect to Securities
delivered within one year after the effective date of such Sale and Lease-Back
Transaction to the Trustee for retirement and cancellation and (B) the principal
amount, plus any premium or fee paid in connection with any redemption in
accordance with the terms, of other Senior Funded Indebtedness voluntarily
retired by the Company within such one year period, excluding in each case
retirements pursuant to mandatory sinking fund or prepayment provisions and
payments at maturity. It is understood that the retirement of Securities
pursuant to this Section shall not be deemed to be a redemption subject to any
limitation contained in this Indenture or the terms of such Securities on the
right to redeem such Securities from, or in anticipation of, moneys borrowed at
an interest cost less than a specified rate per annum.
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(b) Notwithstanding the provisions of Section 3.08(A), the Company or
any Subsidiary may enter into a Sale and Lease-Back Transaction which would
otherwise be subject to the restrictions of Section 3.08(A) so as to create an
aggregate amount of Attributable Debt which, together with all indebtedness
outstanding pursuant to Section 3.07(B) and all Attributable Debt outstanding
pursuant to this Section 3.08(B), does not exceed 15% of Consolidated
Capitalization.
SECTION 3.09. REPORTS BY THE COMPANY. The Company will file with the
Trustee and the Commission and transmit to Holders, such information, documents
and other reports as may be required pursuant to the Trust Indenture Act.
Delivery of such information, documents and reports to the Trustee is for
informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates). At any time when the
Company is not subject to Section 13 or 15(d) of the Exchange Act, upon request
of Holders and prospective purchasers of Securities thereof, the Company will
promptly furnish or cause to be furnished to such holders and prospective
purchasers, copies of the information required to be delivered to such holders
and prospective purchasers of such securities pursuant to Rule 144A(d)(4) under
the Securities Act (or any successor provision thereto) in order to permit
compliance with Rule 144A in connection with resales by such holders of such
securities. The Company will pay the expenses of printing and distributing to
such holders and prospective purchasers all such documents.
ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. EVENTS OF DEFAULT. Each of the following constitutes an
"EVENT OF DEFAULT":
(a) default for 30 days in the payment when due of interest on the
Securities;
(b) default in payment when due of the principal of or premium, if any,
on the Securities;
(c) default for 90 days after written notice to the Company by the
Trustee or by the Holders of not less than 25% in Principal Amount of the Notes
then Outstanding in the performance of any covenant or agreement in the
Indenture or the Securities;
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(d) default with respect to any indebtedness for borrowed money of the
Company or any Subsidiary which default results in the acceleration of such
indebtedness and the total amount of such indebtedness accelerated exceeds
$50,000,000, and such indebtedness is not discharged or such acceleration is not
cured, waived, rescinded or annulled within a period of 10 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, a notice specifying such default and requiring
such indebtedness to be discharged or such acceleration to be cured, waived,
rescinded or annulled;
(e) the entry by a court having jurisdiction in the premises of (i) 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 (ii) a decree or order adjudging the
Company 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 order for relief or any such other decree or order unstayed and in effect for
a period of 60 consecutive calendar days; or
(f) 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 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 with respect to the Company under any
applicable federal or state bankruptcy, insolvency, reorganization, or other
similar 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 pursuant to any such law, or the making by
it of an 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.
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Upon receipt by the Trustee of any Notice of Default pursuant to this
Section 4.01, a record date shall automatically and without any other action by
any Person be set for the purpose of determining the Holders of outstanding
Securities entitled to join in such Notice of Default, which record date shall
be the close of business on the day the Trustee receives such Notice of Default.
The Holders of outstanding Securities on such record date (or their duly
appointed agents), and only such Persons, shall be entitled to join in such
Notice of Default, whether or not such Holders remain Holders after such record
date.
SECTION 4.02. ACCELERATION. (a) If any Event of Default (other than an
Event of Default specified in clause (e) or (f) of Section 4.01 hereof) occurs
and is continuing, the Trustee by notice to the Company or the Holders of at
least 25% in aggregate Principal Amount of the then outstanding Securities by
written notice to the Company and the Trustee, may declare the unpaid principal
of, premium, if any, and any accrued and unpaid interest on all the Securities
to be due and payable immediately. Except as set forth above, upon such
declaration the principal of, premium, if any, and interest shall be due and
payable immediately. If an Event of Default specified in clause (e) or (f) of
Section 4.01 hereof occurs with respect to the Company the unpaid principal of,
premium, if any, and any accrued and unpaid interest on all the Securities shall
IPSO FACTO become and be immediately due and payable without further action or
notice on the part of the Trustee or any Holder.
(b) At any time after such a declaration of acceleration with respect
to the Securities 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 4
provided, the Holders of a majority in Principal Amount of the outstanding
Securities, by written notice to the Company and the Trustee, may rescind and
annul such declaration and its consequences if (i) the Company has paid or
deposited with the Trustee a sum sufficient to pay (a) all overdue interest on
all of the Securities, (B) the principal of (and premium, if any, on) Securities
which have become due otherwise than by such declaration of acceleration and any
interest thereon at the rate or rates prescribed therefor in the Securities, (C)
to the extent that payment of such interest is lawful, interest upon overdue
interest at the rate or rates prescribed therefor in the Securities, and (D) all
sums paid or advanced by the Trustee hereunder and the reasonable compensation,
expenses, disbursements, and advances of the Trustee and its agents and counsel
and (ii) all Events of Default with respect to the Securities, other than the
non-payment of the principal of the Securities which have become due solely by
such declaration of acceleration, have been cured or waived as provided in
Section 4.04. No such recission will affect any subsequent default or impair any
right consequent thereon.
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SECTION 4.03. OTHER REMEDIES. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding 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. A delay
or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
SECTION 4.04. WAIVER OF PAST DEFAULTS. The Holders of not less than a
majority in aggregate Principal Amount of the Securities then outstanding by
written notice to the Trustee may on behalf of the Holders of all of the
Securities waive any existing Default or Event of Default and its consequences
under this Indenture except a continuing Default or Event of Default in the
payment of the principal of, premium, if any, or interest on any Security. The
Company may, but shall not be obligated to, fix a record date for the purpose of
determining the Persons entitled to waive any past default hereunder. If a
record date is fixed, the Holders on such record date, or their duly designated
proxies, and only such Persons, shall be entitled to waive any default
hereunder, whether or not such Holders remain Holders after such record date.
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 4.05. CONTROL BY MAJORITY. Holders of a majority in aggregate
Principal Amount of the then outstanding Securities may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture that
the Trustee in good faith determines may be unduly prejudicial to the rights of
other Holders or that may involve the Trustee in personal liability. The Trustee
may take any other action which it deems proper which is not inconsistent with
any such direction.
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Upon receipt by the Trustee of any such direction with respect to the
Securities, a record date shall automatically and without any other action by
any Person be set for determining the Holders of outstanding Securities entitled
to join in such direction, which record date shall be the close of business on
the day the Trustee receives such direction. The Holders of outstanding
Securities on such record date (or their duly appointed agents), and only such
Persons, shall be entitled to join in such direction, whether or not such
Holders remain Holders after such record date.
SECTION 4.06. LIMITATION ON SUITS. A Holder may pursue a remedy with
respect to this Indenture or the Securities only if:
(a) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(b) the Holders of at least 25% in aggregate Principal Amount of the
then outstanding Securities make a written request to the Trustee to pursue the
remedy;
(c) such Holder or Holders offer to provide to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 90 days after
receipt of the notice, request and the offer of indemnity; and
(e) during such 90-day period the Holders of a majority in aggregate
Principal Amount of the then outstanding Securities do not give the Trustee a
direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or
to obtain a preference or priority over another Holder.
SECTION 4.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment of
principal, premium, if any, and interest on the Security, on or after the
respective due dates expressed in the Security, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of the Holder.
SECTION 4.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default
specified in Section 4.01(A) or (b) hereof occurs and is continuing, the Trustee
is authorized to recover judgment in its own name and as trustee of an express
trust against the Company or any other obligor for the whole amount of
principal, premium, if any,
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and interest remaining unpaid on the Securities and interest on overdue
principal and, to the extent lawful, interest and such further amount as shall
be sufficient to cover amounts due the Trustee under Section 5.07 hereof,
including the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 4.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee is
authorized to file such proofs of claim and other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel) and the Holders allowed in any judicial
proceedings relative to the Company (or any other obligor upon the Securities),
its creditors or its property and shall be entitled and empowered to collect,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian 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 to 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 5.07 hereof. To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 5.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties which the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained 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.
SECTION 4.10. PRIORITIES. If the Trustee collects any money pursuant to
this Article, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 5.07, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;
Second: to Holders for amounts due and unpaid on the Securities for
principal, premium, if any, and interest, ratably, without preference or
priority of
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any kind, according to the amounts due and payable on the Securities for
principal, premium, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 4.10 upon five Business Days prior notice to
the Company.
SECTION 4.11. 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 or omitted by it as a Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 4.07 hereof, or a
suit by Holders of more than 10% in aggregate Principal Amount of the then
outstanding Securities.
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING
DEFAULT; PRIOR TO DEFAULT. The Trustee, prior to the occurrence of an Event of
Default and after the curing or waiving of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture. In case an Event of Default has
occurred (and is continuing which has not been cured or waived) the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own wilful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the curing
or waiving of all such Events of Default which may have occurred:
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(i) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture, and the Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any statements,
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of any such statements,
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a
duty to examine the same to determine whether or not they conform to
the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
holders of not less than a majority in Principal Amount of the Securities at the
time outstanding relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
This Section 5.01 is in furtherance of and subject to Sections 315 and
316 of the Trust Indenture Act of 1939.
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.
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SECTION 5.02. CERTAIN RIGHTS OF THE TRUSTEE. In furtherance of and
subject to the Trust Indenture Act of 1939, and subject to Section 5.01:
(a) the Trustee may conclusively rely and shall be protected in acting
or refraining from acting upon any resolution, Officer's Certificate or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, coupon, security 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, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officer's Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any
resolution of the Board of Directors may be evidenced to the Trustee by a copy
thereof certified by the secretary or an assistant secretary of the Company;
(c) the Trustee may consult with counsel of its selection and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities which might be incurred therein or thereby; but nothing herein
contained shall, however, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default (which has not been cured or waived), to
exercise such of the rights and powers vested in it by this Indenture, and to
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs;
(e) the Trustee shall not be liable for any action taken or omitted by
it in good faith and believed by it to be authorized or within the discretion,
rights or powers conferred upon it by this Indenture;
(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, consent, order, approval, appraisal, bond,
debenture, note, coupon, security, or other paper or document unless requested
in writing so to do by the holders of not less than a majority in aggregate
Principal Amount of the Securities then outstanding; PROVIDED that, if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be
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incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it by
the terms of this Indenture, the Trustee may require indemnity satisfactory to
it against such expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such examination shall be paid by the Company;
(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 not regularly in its employ and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or attorney
appointed with due care by it hereunder;
(h) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder; and
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture
SECTION 5.03. TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF
SECURITIES OR APPLICATION OF PROCEEDS THEREOF. 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 assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of any of the Securities or of the proceeds thereof.
SECTION 5.04. TRUSTEE AND AGENTS MAY HOLD SECURITIES; COLLECTIONS, ETC.
The Trustee or any agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities, subject to
Sections 5.10 and 5.13 with the same rights it would have if it were not the
Trustee or such agent and may otherwise deal with the Company and receive,
collect, hold and retain collections from the Company with the same rights it
would have if it were not the Trustee or such agent.
SECTION 5.05. MONEYS HELD BY TRUSTEE. Subject to the provisions of
Section 11.06 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were
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received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Company or the Trustee shall be under any liability for interest on any
moneys received by it hereunder, except as otherwise agreed with the Company.
SECTION 5.06. NOTICE OF DEFAULT. If any Default or any Event of Default
occurs and is continuing and if such Default or Event of Default is actually
known to a Responsible Officer of the Trustee, the Trustee shall mail to each
Holder in the manner and to the extent provided in Trust Indenture Act Section
313(c) notice of the Default or Event of Default within 90 days after it occurs,
unless such Default or Event of Default has been cured; PROVIDED, HOWEVER, that,
except in the case of a default in the payment of the principal of, premium, if
any, or interest on any Security, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee or
a trust committee of directors and/or Responsible Officers of the Trustee in
good faith determine that the withholding of such notice is in the interest of
the Holders.
SECTION 5.07. COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS PRIOR
CLAIM. The Company covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, such compensation as shall be agreed in
writing between the Company and the Trustee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and the Company covenants and agrees to pay or reimburse the Trustee and each
predecessor Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by or on behalf of it in accordance with any of
the provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents and other persons
not regularly in its employ) except any such expense, disbursement or advance as
may arise from its negligence or bad faith. The Company also covenants to
indemnify the Trustee and each predecessor Trustee for, and to hold it harmless
against, any and all loss, liability, damage, claim or expense, including taxes
(other than taxes based on the income of the Trustee) incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this Indenture or the trusts hereunder and its
duties hereunder, including the costs and expenses of defending itself against
or investigating any claim (whether asserted by the Company, a Holder or any
other Person) of liability in the premises. The obligations of the Company under
this Section to compensate and indemnify the Trustee and each predecessor
Trustee and to pay or reimburse the Trustee and each predecessor Trustee for
expenses, disbursements and advances shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this Indenture.
Such additional indebtedness shall be a senior claim to that of the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the benefit of the
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holders of particular Securities, and the Securities are hereby subordinated to
such senior claim.
When the Trustee incurs expenses or renders services in connection with
an Event of Default specified in Section 4.01(E) or Section 4.01(F), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
SECTION 5.08. RIGHT OF TRUSTEE TO RELY ON OFFICER'S CERTIFICATE, ETC.
Subject to Sections 5.01 and 5.02, whenever in the administration of the trusts
of this Indenture the Trustee shall deem it necessary or desirable that a matter
be proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officer's Certificate delivered to the Trustee, and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.
SECTION 5.09. PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. The Trustee
hereunder shall at all times be a corporation having a combined capital and
surplus of at least $50,000,000, and which is eligible in accordance with the
provisions of Section 310(a) of the Trust Indenture Act of 1939. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of a Federal, State or District of Columbia supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
SECTION 5.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR
TRUSTEE. (a) The Trustee may at any time resign by giving written notice of
resignation to the Company and to the Holders, such notice to the Holders to be
given by mailing (by first class mail) the same within 30 days after such notice
is given to the Company. Upon receiving such notice of resignation, the Company
shall promptly appoint a successor trustee by written instrument in duplicate,
executed by authority of the Board of Directors, one copy of which instrument
shall be delivered to the resigning Trustee and one copy to the successor
trustee. If no successor trustee shall have been so appointed and have accepted
appointment within 60 days after the mailing of such notice of resignation, the
resigning trustee may petition, at the expense of the Company, any court of
competent jurisdiction
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for the appointment of a successor trustee, or any Securityholder who has been a
bona fide holder of a Security or Securities for at least six months may, on
behalf of himself and all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, after written
request therefor by the Company or by any Securityholder who has been a
bona fide holder of a Security or Securities for at least six months;
or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.09 and shall fail to resign after written
request therefor by the Company or by any such Securityholder; or
(iii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver or liquidator 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;
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder
who has been a bona fide holder of a Security or Securities 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 and the
appointment of a successor trustee. Such court may thereupon, after such notice,
if any, as it may deem proper and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate Principal Amount of the
Securities at the time outstanding may at any time remove the Trustee and
appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Company the evidence provided for in
Section 6.01 of the action in that regard taken by the Securityholders.
If no successor trustee shall have been so appointed and have accepted
appointment 60 days after the mailing of such notice of removal, the trustee
being removed may petition, at the expense of the Company, any court of
competent
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jurisdiction for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
(d) Any resignation or removal of the Trustee and any appointment of a
successor trustee pursuant to any of the provisions of this Section 5.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 5.11.
SECTION 5.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any
successor trustee appointed as provided in Section 5.10 shall execute and
deliver to the Company and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of the Company or of the successor trustee, upon payment of its charges then
unpaid, the trustee ceasing to act shall, subject to Section 11.06, pay over to
the successor trustee all moneys at the time held by it hereunder and shall
execute and deliver an instrument transferring to such successor trustee all
such rights, powers, duties and obligations. Upon request of any such successor
trustee, the Company shall execute any and all instruments in writing for more
fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any trustee ceasing to act shall, nevertheless, retain a
prior claim upon all property or funds held or collected by such trustee to
secure any amounts then due it pursuant to the provisions of Section 5.07.
Upon acceptance of appointment by a successor trustee as provided in
this Section 5.11, the Company shall mail notice thereof by first-class mail to
the holders of Securities at their last addresses as they shall appear in the
Security register. If the acceptance of appointment is substantially
contemporaneous with the resignation, then the notice called for by the
preceding sentence may be combined with the notice called for by Section 5.10.
If the Company fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.
SECTION 5.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS OF TRUSTEE. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or to which the Trustee's assets
may be sold, or any corporation resulting from any merger, conversion,
consolidation or sale to which the Trustee shall be a party or by which the
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Trustee's property may be bound, 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 that such corporation shall be
eligible under the provisions of Section 5.09, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificate shall have the
full force that it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; PROVIDED, that the right to
adopt the certificate of authentication of any predecessor Trustee or to
authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.
SECTION 5.13. PREFERENTIAL COLLECTION OF CLAIMS. If the Trustee shall
be or shall become a creditor, directly or indirectly, secured or unsecured, of
the Company (or any other obligor on the Securities), the Trustee shall be
subject to the provisions of Section 311 of the Trust Indenture Act regarding
the collection of claims against the Company (or any such other obligor). For
purposes of Section 311(b) (4) and (6) of such Act, the following terms shall
mean:
(a) "CASH TRANSACTION" means any transaction in which full payment for
goods or securities sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
(b) "SELF-LIQUIDATING PAPER" means any draft, bill of exchange,
acceptance or obligation which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase, processing, manufacturing,
shipment, storage or sale of goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the security, PROVIDED the
security is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making, drawing,
negotiating or incurring of the draft, bill of exchange, acceptance or
obligation.
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ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. EVIDENCE OF ACTION TAKEN BY HOLDERS. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Securityholders may be embodied in and
evidenced (a) by one or more instruments of substantially similar tenor signed
by such Securityholders in person or by agent duly appointed in writing, (b) by
the record of the holders of Securities voting in favor thereof at any meeting
of Securityholders duly called and held in accordance with the provisions of
Article 7, or (c) by a combination of such instrument or instruments and any
such record of such a meeting of Securityholders; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee. Proof of execution of
any instrument or of a writing appointing any such agent shall be sufficient for
any purpose of this Indenture and (subject to Sections 5.01 and 5.02) conclusive
in favor of the Trustee and the Company, if made in the manner provided in this
Article.
SECTION 6.02. PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF
SECURITIES; RECORD DATE. Subject to Sections 5.01 and 5.02, the execution of any
instrument by a Securityholder or his agent or proxy may be proved in accordance
with such reasonable rules and regulations as may be prescribed by the Trustee
or in such manner as shall be satisfactory to the Trustee. The holding of
Securities shall be proved by the Security register or by a certificate of the
Registrar thereof. The Company may set a record date for purposes of determining
the identity of holders of Securities entitled to vote or consent to any action
referred to in Section 6.01, which record date may be set at any time or from
time to time by notice to the Trustee, for any date or dates (in the case of any
adjournment or resolicitation) not more than 90 days nor less than 20 days prior
to the proposed date of such vote or consent, and thereafter, notwithstanding
any other provisions hereof, only holders of Securities of record on such record
date shall be entitled to so vote or give such consent or to withdraw such vote
or consent.
SECTION 6.03. WHO MAY BE DEEMED OWNERS OF SECURITIES. The Company, the
Trustee, any paying agent and any Security registrar may deem and treat the
person in whose name any Security shall be registered upon the books of the
Company on the applicable record date as the absolute owner of such Security
(whether or not such Security shall be overdue and notwithstanding any notation
of ownership or other writing thereon) for the purpose of receiving payment of
or
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on account of the principal of, premium, if any, and interest on such Security
and for all other purposes; and neither the Company nor the Trustee nor any
paying agent nor any Security registrar shall be affected by any notice to the
contrary. All such payments so made to, or upon the order of, any Holders shall
be valid, and, to the extent of the sum or sums so paid, effectual to satisfy
and discharge the liability of moneys payable upon any such Security.
SECTION 6.04. SECURITIES OWNED BY COMPANY DEEMED NOT OUTSTANDING. In
determining whether the Holders of the requisite aggregate Principal Amount of
Securities have concurred in any direction, consent or waiver under this
Indenture, Securities which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, except that for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver only Securities which a Responsible Officer of the Trustee actually
knows are 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 person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Securities. In case of a dispute as to such right, the
advice of counsel shall be full protection in respect of any decision made by
the Trustee in accordance with such advice. Upon request of the Trustee, the
Company shall furnish to the Trustee promptly an Officer's Certificate listing
and identifying all Securities, if any, known by the Company to be owned or held
by or for the account of any of the above-described persons; and, subject to
Sections 5.01 and 5.02, the Trustee shall be entitled to accept such Officer's
Certificate as conclusive evidence of the facts therein set forth and of the
fact that all Securities not listed therein are outstanding for the purpose of
any such determination.
SECTION 6.05. RECORD DATE FOR ACTION BY SECURITYHOLDERS. Whenever in
this Indenture it is provided that Holders of a specified percentage in
aggregate principal amount of the Securities may take any action (including the
making of any demand or request, the giving of any direction, notice, consent or
waiver or the taking of any other action), other than any action taken at a
meeting of Securityholders called pursuant to Article 7, the Company, pursuant
to a resolution of its Board of Directors, or the Holders of at least ten
percent in aggregate principal amount of the Securities then outstanding, may
request the Trustee to fix a record date for determining Securityholders
entitled to notice of and to take any such action. In case the Company or the
Holders of Securities in
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the amount above specified shall desire to request Securityholders to take any
action and shall request the Trustee to fix a record date with respect thereto
by written notice setting forth in reasonable detail the Securityholder action
to be requested, the Trustee shall promptly (but in any event within five days
of receipt of such request) fix a record date that shall be a business day not
less than 15 nor more than 20 days after the date on which the Trustee receives
such request. If the Trustee shall fail to fix a record date as hereinabove
provided, then the Company or the Holders in the amount above specified may fix
the same by mailing written notice thereof (the record date so fixed to be a
business day not less than 15 nor more than 20 days after the date on which such
written notice shall be given) to the Trustee. If a record date is fixed
according to this Section 6.05, only persons shown as Securityholders on the
registration books for the Company at the close of business on the record date
so fixed shall be entitled to take the requested action and the taking of such
action by the Holders on the record date of the required percentage of the
aggregate Principal Amount of the Securities shall be binding on all
Securityholders, provided that the taking of the requested action by the Holders
on the record date of the percentage in aggregate Principal Amount of the
Securities in connection with such action shall have been evidenced to the
Trustee, as provided in Section 6.01, not later than 180 days after such record
date.
SECTION 6.06. RIGHT OF REVOCATION OF ACTION TAKEN. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 6.01, of
the taking of any action by the holders of the percentage in aggregate Principal
Amount of the Securities specified in this Indenture in connection with such
action, any holder of a Security the serial number of which is shown by the
evidence to be included among the serial numbers of the Securities the Holders
of which have consented to such action may, by filing written notice at the
Corporate Trust Office and upon proof of holding as provided in this Article,
revoke such action so far as concerns such Security. Except as aforesaid any
such action taken by the holder of any Security shall be conclusive and binding
upon such holder and upon all future holders and owners of such Security and of
any Securities issued in exchange or substitution therefor, irrespective of
whether or not any notation in regard thereto is made upon any such Security.
Any action taken by the holders of the percentage in aggregate Principal Amount
of the Securities specified in this Indenture in connection with such action
shall be conclusively binding upon the Company, the Trustee and the holders of
all the Securities.
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ARTICLE 7
SECURITYHOLDERS' MEETINGS
SECTION 7.01. PURPOSES FOR WHICH MEETING MAY BE CALLED. A meeting of
Holders of Securities may be called at any time and from time to time pursuant
to the provisions of this Article 7 for any of the following purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any default or Event
of Default hereunder and its consequences, or take any other action authorized
to be taken by Securityholders pursuant to any of the provisions of Article 4;
(b) to remove the Trustee and appoint a successor trustee pursuant to
the provisions of Article 5;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 8.02; or
(d) to take any other action authorized to be taken by or on behalf of
the holders of the percentage in aggregate Principal Amount of the Securities
under any other provisions of this Indenture or under applicable law.
SECTION 7.02. MANNER OF CALLING MEETINGS; RECORD DATE. The Trustee may
at any time call a meeting of Securityholders to take any action specified in
Section 7.01, to be held at such time and at such place in The City of New York,
New York, or as the Trustee shall determine. Notice of every meeting of the
Securityholders setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be mailed
not less than thirty nor more than sixty days prior to the date fixed for the
meeting to such Securityholders at their registered addresses. For the purpose
of determining Securityholders entitled to notice of any meeting of
Securityholders, the Trustee shall fix in advance a date as the record date for
such determination, such date to be a business day not more than ten days prior
to the date of the mailing of such notice as hereinabove provided. Only persons
in whose name any Security shall be registered upon the books of the Company on
a record date fixed by the Trustee as aforesaid, or by the Company or the
Securityholders as in Section 7.03 provided, shall be entitled to notice of the
meeting of Securityholders with respect to which such record date was so fixed.
SECTION 7.03. CALL OF MEETING BY COMPANY OR SECURITYHOLDERS. In case at
any time the Company, pursuant to a resolution of its Board of Directors, or the
Holders of at least ten percent in aggregate principal amount of the Securities
then
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outstanding, shall have requested the Trustee to call a meeting of the
Securityholders to take any action authorized in Section 7.01 by written request
setting forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have mailed notice of such meeting within
twenty days after receipt of such request, then the Company or the Holders of
such Securities in the amount above specified may fix the record date with
respect to, and determine the time and the place for, such meeting and may call
such meeting to take any action authorized in Section 7.01, by mailing notice
thereof as provided in Section 7.02. The record date fixed as provided in the
preceding sentence shall be set forth in a written notice to the Trustee and
shall be a business day not less than 15 nor more than 20 days after the date on
which such notice is sent to the Trustee.
SECTION 7.04. WHO MAY ATTEND AND VOTE AT MEETING. To be entitled to
vote at any meeting of Securityholders a person shall be a holder of one or more
Securities. The only person who shall be entitled to be present or to speak at
any meeting of Securityholders shall be the persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee and its counsel
and any representatives of the Company and its counsel. When a determination of
Securityholders entitled to vote at any meeting of Securityholders has been made
as provided in this Section 7.04, such determination shall apply to any
adjournment thereof.
SECTION 7.05. REGULATIONS. Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, in regard to proof of the holding
of the Securities and of the appointment of proxies, and in regard to the
appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall think fit. Except as
otherwise permitted or required by any such regulations, the holding of such
Securities shall be provided in the manner specified in Section 7.06.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 7.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by a vote of the holders of a majority
in Principal Amount of the Securities represented at the meeting and entitled to
vote.
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Subject to the provisions of Section 6.04, at any meeting each
Securityholder or proxy entitled to vote thereat shall be entitled to one vote
for each $1,000 principal amount of Securities held or represented by him;
provided, however, that no vote shall be cast or counted at any meeting in
respect of any Security challenged as not outstanding and ruled by the chairman
of the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote other than by virtue of Securities held by him or instruments in
writing as aforesaid duly designating him as the person to vote on behalf of
other Securityholders. Any meeting of Securityholders duly called pursuant to
the provisions of Section 7.02 or 7.03 may be adjourned from time to time, and
the meeting may be held as so adjourned without further notice.
At any meeting of Securityholders, the presence of persons who held, or
who are acting as proxy for persons who held, an aggregate Principal Amount of
Securities on the record date for such meeting sufficient to take action on the
business for the transaction of which such meeting was called shall constitute a
quorum, but, if less than a quorum is present, the persons holding or
representing a majority in aggregate Principal Amount of the Securities
represented at the meeting may adjourn such meeting with the same effect, for
all intents and purposes, as though a quorum had been present.
SECTION 7.06. MANNER OF VOTING AT MEETINGS AND RECORD TO BE KEPT. The
vote upon any resolution submitted to any meeting of Securityholders shall be by
written ballots on each of which shall be subscribed the signature of the
Securityholder or proxy casting such ballot and the identifying number or
numbers of the Securities held or represented in respect of which such ballot is
cast. The permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Securityholders shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 7.02. The record shall show the
identifying numbers of the Securities voting in favor of or against any
resolution. Each counterpart of such record shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one of the
counterparts shall be delivered to the Company and the other to the Trustee to
be preserved by the Trustee.
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Any counterpart record so signed and verified shall be conclusive
evidence of the matters therein stated and shall be the record referred to in
clause (b) of Section 7.01.
SECTION 7.07. EXERCISE OF RIGHTS OF TRUSTEE AND SECURITYHOLDERS NOT TO
BE HINDERED OR DELAYED. Nothing in this Article 7 contained shall be deemed or
construed to authorize or permit, by reason of any call of a meeting of
Securityholders or any rights expressly or impliedly conferred hereunder to make
such call, any hindrance or delay in the exercise of any right or rights
conferred upon or reserved to the Trustee or to the Securityholders under any of
the provisions of this Indenture or of the Securities.
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS. The
Company and the Trustee may amend or supplement this Indenture or the Securities
without the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Securities in addition to or in place
of certificated Securities;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Securities in the case of any transaction pursuant to Article 9
hereof;
(d) to evidence and provide for the acceptance of appointment hereunder
by a successor trustee and to add to or change any of the provisions of the
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one trustee;
(e) to make any change that would provide any additional rights or
benefits to the Holders of the Securities or that does not adversely affect the
legal rights hereunder of any such Holder; or
(f) to comply with requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act.
Upon the request of the Company accompanied by a resolution of their
respective Board of Directors authorizing the execution of any such supplemental
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indenture, and upon receipt by the Trustee of the documents described in Section
8.04 hereof, the Trustee shall join with the Company in the execution of any
supplemental indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations which may be
therein contained, but the Trustee shall not be obligated to enter into such
supple mental indenture which affects its own rights, duties or immunities under
this Indenture or otherwise.
SECTION 8.02. WITH CONSENT OF HOLDERS. Except as provided in the next
succeeding paragraphs, this Indenture or the Securities may be amended or
supplemented with the consent of the Holders of at least a majority in aggregate
Principal Amount of the Securities then outstanding (including consents obtained
in connection with a tender offer or exchange offer for such Securities), and
any existing default or compliance with any provision of this Indenture or the
Securities may be waived with the consent of the Holders of a majority in
aggregate Principal Amount of the then outstanding Securities (including
consents obtained in connection with a tender offer or exchange offer for such
Securities).
Upon the request of the Company accompanied by a resolution of their
respective Board of Directors authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders as aforesaid, and upon receipt by the
Trustee of the documents described in Section 8.04 hereof, the Trustee shall
join with the Company in the execution of such supplemental indenture unless
such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the Holders under this
Section 8.02 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture or waiver.
Subject to Sections 4.04 and 4.07 hereof, the Holders of a majority in aggregate
Principal Amount of the Securities then outstanding may waive compliance in a
particular instance by the Company with any provision of this Indenture or the
Securities. Without the consent of each Holder, however, an amendment or waiver
may not:
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(a) reduce the Principal Amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(b) change the stated maturity of the principal of, or any installment
of principal of or interest on, or time for payment of interest on, any
Security, or reduce the Principal Amount thereof or the rate of interest thereon
or any premium payable upon the redemption thereof, or change any Payment Office
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 the stated maturity thereof (or, in the case of
redemption, on or after the Redemption Date);
(c) modify any of the provisions of this Section 8.02, Section 4.04 or
Section 3.06, except to increase the percentage in Principal Amount of Holders
required under any such Section 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
(c) will 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 8.02, Section 4.04 and Section 3.06, or the deletion of this proviso, in
accordance with the requirements of Section 5.11; or
(d) make any change in this sentence of this Section 8.02.
SECTION 8.03. EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Company and the Holders shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 8.04. DOCUMENTS TO BE GIVEN TO TRUSTEE; COMPLIANCE WITH TIA.
The Trustee, subject to the provisions of Sections 5.01 and 5.02, may receive an
Officer's Certificate and an Opinion of Counsel as conclusive evidence that any
such supplemental indenture complies with the applicable provisions of this
Indenture. Every such supplemental indenture shall comply with the TIA.
SECTION 8.05. NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL
INDENTURES. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article may bear a
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notation approved by the Trustee as to form (but not as to substance) as to any
matter provided for by such supplemental indenture or as to any action taken at
any such meeting. If the Company or the Trustee shall so determine, new
Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors of the Company, to any modification of this Indenture
contained in any such supplemental indenture may be prepared by the Company,
authenticated by the Trustee and delivered in exchange for the Securities then
outstanding.
ARTICLE 9
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 9.01. WHEN THE COMPANY MAY MERGE, ETC. The Company shall not
consolidate with or merge into any other Person or convey or transfer its
properties and assets substantially as an entirety to any Person, unless:
(a) the Person formed by such consolidation or into which the Company
is merged or the Person which acquires by conveyance or transfer the properties
and assets of the Company substantially as an entirety shall be a Person
organized and existing under the laws of the United States of America or any
State or the District of Columbia, and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, the due and punctual
payment of the principal of (and premium, if any) and interest, if any, on all
the Securities and the performance or observance of every covenant of this
Indenture of the part of the Company to be performed or observed;
(b) 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; and
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that such consolidation, merger,
conveyance or transfer and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to such
transaction have been complied with.
SECTION 9.02. SUCCESSOR CORPORATION SUBSTITUTED. Upon any consolidation
or merger, or any sale, assignment, transfer, lease, conveyance or other
disposition of all or substantially all of the assets of the Company in
accordance with Section 9.01 hereof, the successor corporation formed by such
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consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, assignment, transfer, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "COMPANY" shall
refer instead to the successor corporation), 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.
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
Notwithstanding the foregoing, (i) a consolidation or merger by the
Company with or into, or (ii) the sale, assignment, transfer, lease, conveyance
or other disposition by the Company of all or substantially all of its property
or assets to, one or more of its Subsidiaries shall not relieve the Company from
its obligations under this Indenture and the Securities.
SECTION 9.03. OPINION OF COUNSEL TO TRUSTEE. The Trustee, subject to
the provisions of Sections 5.01 and 5.02, may receive an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, conveyance, sale,
transfer, lease, exchange or other disposition complies with the applicable
provisions of this Indenture.
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.01. RIGHT OF OPTIONAL REDEMPTION; PRICES. The Securities are
redeemable in whole or in part, at the option of the Company at any time and
from time to time, on not less than 30 or more than 60 days' prior notice mailed
to the Holders of the Securities, at a Redemption Price equal to the greater of
(i) 100% of the Principal Amount of the Securities to be redeemed and (ii) the
sum of the present values of the Remaining Scheduled Payments thereon discounted
to the Redemption Date on a semiannual basis (assuming a 360-day year consisting
of twelve 30-day months) at the Treasury Rate plus 10 basis points, together in
either case with accrued interest on the Principal Amount being redeemed to the
Redemption Date.
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SECTION 10.02. NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS. Notice of
redemption to the holders of Securities to be redeemed as a whole or in part
shall be given by mailing notice of such redemption by first class mail, postage
prepaid, at least 30 days and not more than 60 days prior to the date fixed for
redemption to such holders of Securities at their last addresses as they shall
appear upon the registry books. Any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the Holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
The notice of redemption to each such Holder shall identify the
Securities to be redeemed (including CUSIP numbers) and shall specify the
Principal Amount of each Security held by such Holder to be redeemed, the date
fixed for redemption, the redemption price, the place or places of payment, that
payment will be made upon presentation and surrender of such Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice and that on and after said date interest thereon or on the portions
thereof to be redeemed will cease to accrue. In case any Security is to be
redeemed in part only the notice of redemption shall state the portion of the
Principal Amount thereof to be redeemed and shall state that on and after the
date fixed for redemption, upon surrender of such Security, a new Security or
Securities in Principal Amount equal to the unredeemed portion thereof will be
issued.
The notice of redemption of Securities to be redeemed at the option 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.
No later than 10:00 a.m. on the redemption date specified in the notice
of redemption given as provided in this Section, the Company will deposit with
the Trustee or with one or more paying agents (or, if the Company is acting as
its own paying agent, set aside, segregate and hold in trust) an amount of money
sufficient to redeem on the redemption date all the Securities so called for
redemption at the appropriate redemption price, together with accrued interest
to the date fixed for redemption. The Company will deliver to the Trustee at
least 70 days prior to the date fixed for redemption an Officer's Certificate
stating the aggregate Principal Amount of Securities to be redeemed.
If less than all the Securities are to be redeemed, the Trustee shall
select, either pro rata, by lot or by any other method it shall deem fair and
reasonable, Securities to be redeemed in whole or in part. Securities may be
redeemed in part in multiples of $1,000 only. The Trustee shall promptly notify
the Company in writing of the Securities selected for redemption and, in the
case of any Securities
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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 Security redeemed or to be redeemed only in part, to the portion of the
Principal Amount of such Security which has been or is to be redeemed.
SECTION 10.03. PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If notice
of redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said
date (unless the Company shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue and, except as provided in Sections 5.05 and 11.06, such Securities shall
cease from and after the date fixed for redemption to be entitled to any benefit
or security under this Indenture, and the Holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to the date fixed for redemption. On presentation
and surrender of such Securities at a Payment Office specified in said notice,
said Securities or the specified portions thereof shall be paid and redeemed by
the Company at the applicable redemption price, together with interest accrued
thereon to the date fixed for redemption; PROVIDED that any semi-annual payment
of interest becoming due on the date fixed for redemption shall be payable to
the holders of such Securities registered as such on the relevant Interest
Record Date subject to the terms and provisions of Section 2.04 hereof.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate borne
by the Security.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for delivery
to or on the order of the Holder thereof, at the expense of the Company, a new
Security or Securities of authorized denominations, in Principal Amount equal to
the unredeemed portion of the Security so presented.
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ARTICLE 11
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 11.01. COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT
DEFEASANCE. The Company may, at its option, by resolution of the Board of
Directors, at any time, elect to have either Section 11.02 or Section 11.03
applied to the outstanding Securities upon compliance with the conditions set
forth below in this Article 11.
SECTION 11.02. LEGAL DEFEASANCE AND DISCHARGE. Upon the Company's
exercise under Section 11.01 hereof of the option applicable to this Section
11.02, the Company shall be deemed to have been discharged from its obligations
with respect to all outstanding Securities on the date the conditions set forth
below are satisfied (hereinafter, "LEGAL DEFEASANCE"). For this purpose, such
Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Securities,
which shall thereafter be deemed to be "outstanding" only for the purposes of
Section 11.05 hereof and the other Sections of this Indenture referred to in
clauses (i) and (ii) of this Section 11.02, and to have satisfied all its other
obligations under such Securities and this Indenture (and the Trustee, on demand
of and at the expense of the Company shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (i) the rights of Holders of
outstanding Securities to receive solely from the trust fund described in
Section 11.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest on such Securities
when such payments are due, (ii) the Company's obligations with respect to such
Securities under Sections 2.05, 2.06, 2.07(A), 2.08, 2.09, 2.11, and 11.05
hereof, (iii) the rights, powers, trusts, duties and immunities of the Trustee
hereunder, including, without limitation, the Trustee's rights under Section
5.07 hereof, and the Company's obligations in connection therewith and with this
Article 11. Subject to compliance with this Article 11, the Company may exercise
their option under this Section 11.02 notwithstanding the prior exercise of its
option under Section 11.03 hereof with respect to the Securities.
SECTION 11.03. COVENANT DEFEASANCE. Upon the Company's exercise under
Section 11.01 hereof of the option applicable to this Section 11.03, the Company
shall be released from their obligations under the covenants contained in
Article 3 and Section 9.01 hereof with respect to the outstanding Securities on
and after the date the conditions set forth below are satisfied (hereinafter,
"COVENANT DEFEASANCE"), and the Securities shall thereafter be deemed not
outstanding for the purposes of any direction, waiver, consent or declaration or
act
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of Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed outstanding for all other purposes
hereunder. For this purpose, such Covenant Defeasance means that, with respect
to the outstanding Securities, 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 covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 4.01(C) hereof, but, except as specified above, the remainder of this
Indenture, such Securities shall be unaffected thereby. In addition, upon the
Company's exercise under Section 11.01 hereof of the option applicable to this
Section 11.03 and Section 4.01(D) hereof shall not constitute Events of Default.
SECTION 11.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE. The
following shall be the conditions to the application of either Section 11.02 or
Section 11.03 hereof to the outstanding Securities:
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 5.10 who shall agree to comply with the provisions of this Article 11
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, (i) cash in U.S. Dollars in
an amount, or (ii) non-callable Government Securities that 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,
cash in U.S. Dollars in an amount, or (iii) a combination thereof, in such
amounts as will be 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 interest on such outstanding Securities on the stated
maturity date of such principal or installment of principal, premium, if any, or
interest.
(b) In the case of an election under Section 11.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel confirming that (i)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (ii) since the date hereof, there has been a change
in the applicable Federal income tax law, in either case to the effect that, and
based thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Securities will not recognize income, gain or loss for Federal
income tax purposes as a result of such Legal Defeasance and will be subject to
Federal
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income tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred.
(c) In the case of an election under Section 11.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel confirming that the
Holders of the outstanding Securities will not recognize income, gain or loss
for Federal income tax purposes as a result of such 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 Covenant Defeasance had not
occurred.
(d) No Default or Event of Default (or event that, with the giving of
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 Section
4.01(E) or 4.01(F) hereof is concerned, at any time in the period ending on the
124th day after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until the expiration of such period).
(e) Such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under any material agreement or
instrument (other than this Indenture) to which the Company is a party or by
which the Company or is bound (other than a breach, violation or default
resulting from the borrowing of funds to be applied to such deposit).
(f) The Company shall have delivered to the Trustee an Officer's
Certificate stating that the deposit made by the Company pursuant to its
election under Section 11.02 or 11.03 hereof was not made by the Company with
the intent of preferring the Holders of the Securities over the other creditors
of the Company with the intent of defeating, hindering, delaying or defrauding
creditors of the Company, or others.
(g) The Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Legal Defeasance under Section
11.02 hereof or the Covenant Defeasance under Section 11.03 hereof (as the case
may be) have been complied with as contemplated by this Section 11.04.
SECTION 11.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS. Subject to Section 11.06 hereof, all
money and non-callable Government Securities (including the proceeds thereof)
deposited with the Trustee pursuant to Section 11.04 hereof in respect of the
outstanding Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
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payment, either directly or through any paying agent (including the Company
acting as paying agent) as the Trustee may determine, to the Holders of such
Securities of all sums due and to become due thereon in respect of principal of,
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 cash or non-callable Government
Securities deposited pursuant to Section 11.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge that by law is for the account of the Holders of the outstanding
Securities.
Anything in this Article 11 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the Company's
request any money or non-callable Government Securities held by it as provided
in Section 11.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
11.04(A) hereof), are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
SECTION 11.06. REPAYMENT TO THE COMPANY. 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, premium, if any, or interest on any Security and
remaining unclaimed for two years after such principal, premium, if any, or
interest has become due and payable shall be paid to the Company on its written
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 THE
NEW YORK TIMES and THE WALL STREET JOURNAL (national edition), 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 notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 11.07. REINSTATEMENT. If the Trustee or paying agent is unable
to apply any U.S. Dollars or non-callable Government Securities in accordance
with Section 11.02 or 11.03 hereof, as the case may be, by reason of any order
or judgment of any court or governmental authority enjoining, restraining or
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otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 11.02 or 11.03 hereof until such time
as the Trustee or paying agent is permitted to apply all such money in
accordance with Section 11.02 or 11.03 hereof, as the case may be; PROVIDED,
HOWEVER, that, if the Company makes any payment of principal of, premium, if
any, or interest on any Security following the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Security to
receive such payment from the money held by the Trustee or paying agent.
ARTICLE 12
SATISFACTION AND DISCHARGE
SECTION 12.01. SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall upon a Company Request cease to be of further effect with respect to the
Securities (except, as to any surviving rights of registration of transfer,
exchange or conversion of Securities herein expressly provided for and any
rights to receive payment of interest thereon), and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when:
(a) either
(i) all Securities of such series theretofore authenticated and
delivered (other than (A) Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section
2.09, and (B) Securities for whose payment money has theretofore been
(x) 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 3.03(c) or (y) paid to any State or the District of
Columbia pursuant to its unclaimed property or similar laws) have been
delivered to the Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee
for cancellation
(A) have become due and payable, or
(B) will become due and payable at their stated maturity
within one year, or
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(C) 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 (A), (B) or (C) above, has
deposited or caused to be deposited with the Trustee, as trust
funds in trust for the purpose, money in the amount in the
currency in which such Securities are payable, sufficient to pay
and discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest, if any, 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;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) 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 with
respect to the Securities, the obligations of the Company to the Trustee under
Section 5.07 and, if money shall have been deposited with the Trustee pursuant
to subclause (ii) of Clause (a) of this Section, the obligations of the Trustee
under Section 12.02 and the last paragraph of Section 3.03 shall survive.
SECTION 12.02. APPLICATION OF TRUST MONEY. Subject to the provisions of
the last paragraph of Section 3.03, all money deposited with the Trustee
pursuant to Section 12.01 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 premium, if any) and interest, if any,
for whose payment such money has been deposited with the Trustee.
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ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.01. INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS OF
COMPANY EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such or against any past, present or future stockholder,
officer or director, as such, of the Company or of any successor, either
directly or through the Company or any successor, under any rule of law, statute
or constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance of the Securities by the holders thereof
and as part of the consideration for the issue of the Securities.
SECTION 13.02. PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES
AND HOLDERS. Except as set forth in Section 13.09, nothing in this Indenture or
in the Securities, expressed or implied, shall give or be construed to give to
any person, firm or corporation, other than the parties hereto and their
successors and the holders of the Securities, any legal or equitable right,
remedy or claim under this Indenture or under any covenant or provision herein
contained, all such covenants and provisions being for the sole benefit of the
parties hereto and their successors and of the holders of the Securities.
SECTION 13.03. SUCCESSORS AND ASSIGNS OF COMPANY BOUND BY INDENTURE.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company shall bind their successors and
assigns, whether so expressed or not.
SECTION 13.04. NOTICES AND DEMANDS ON COMPANY, TRUSTEE AND HOLDERS. Any
notice or demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the holders of Securities
to or on the Company may be given or served by being deposited postage prepaid,
first-class mail (except as otherwise specifically provided herein) addressed
(until another address of the Company is filed by the Company with the Trustee)
to: The Home Depot, Inc., 2455 Paces Ferry Road, Atlanta, Georgia 30339-4024,
Attention: Dennis J. Carey, Executive Vice President and Chief Financial
Officer, with a copy to Kelly R. Caffarelli, Corporate Counsel. Any notice,
direction, request or demand by the Company or any Securityholder to or upon the
Trustee shall be deemed to have been sufficiently given or made, for all
purposes, if given or made at the Corporate Trust Office.
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Where this Indenture provides for notice to Holders, such notice shall
be sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to each Holder entitled thereto, at his
last address as it appears in the Security register. 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. The Trustee may waive notice
to it of any provision herein, and such waiver shall be deemed to be for its
convenience and discretion. 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 or irregularities in regular
mail service, it shall be impracticable to mail notice to the Company and
Securityholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 13.05. OFFICER'S CERTIFICATES AND OPINIONS OF COUNSEL;
STATEMENTS TO BE CONTAINED THEREIN. Upon any application or demand by the
Company to the Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officer's Certificate
stating that all conditions precedent provided for in this Indenture relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent have been
complied with, except that in the case of any such application or demand as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or demand, no
additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (a) a statement that the person
making such certificate or opinion has read such covenant or condition, (b) 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, (c) a statement that, in the opinion of such person, 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 (d) a
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statement as to whether or not, in the opinion of such person, such condition or
covenant has been complied with.
Any certificate, statement 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 that the certificate
or opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or Opinion of Counsel may be based, insofar as it relates
to factual matters or information which is in the possession of the Company,
upon the certificate, statement or opinion of or representations by an officer
or officers of the Company unless such counsel knows that the certificate,
statement or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the Company or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Company unless such officer or counsel knows
that the certificate or opinion or representations with respect to the
accounting matters upon which his certificate, statement or opinion may be based
as aforesaid are erroneous, or in the exercise of reasonable care should know
that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
SECTION 13.06. PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If the
date of maturity of interest on or principal of the Securities or the date fixed
for redemption of any Security shall not be a Business Day, then payment of
interest or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date.
SECTION 13.07. CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST
INDENTURE ACT OF 1939. If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with another provision included in this Indenture
by operation of Sections 310 to 317, inclusive, of the Trust Indenture Act of
1939 (an "INCORPORATED PROVISION"), such incorporated provision shall control.
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SECTION 13.08. NEW YORK LAW TO GOVERN. This Indenture and each Security
shall be deemed to be a contract under the laws of the State of New York, and
for all purposes shall be construed in accordance with the laws of said State,
without giving regard to conflicts of law principles.
SECTION 13.09. THIRD PARTY BENEFICIARIES. Holders of Senior Debt of the
Company are third party beneficiaries of this Indenture, and any of them (or
their representative) shall have the right to enforce the provisions of this
Indenture that benefit such holders.
SECTION 13.10. COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 13.11. EFFECT OF HEADINGS. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
SECTION 13.12. SEVERABILITY. If any provision hereof shall be held to
be invalid, illegal or unenforceable under applicable law, then the remaining
provisions hereof shall be construed as though such invalid, illegal or
unenforceable provision were not contained herein.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of September 27, 1999.
THE HOME DEPOT, INC.,
as Company
By /s/ Carol B. Tome
-------------------------------
Title: Vice President-Treasurer
THE BANK OF NEW YORK,
as Trustee
By /s/ Marie E. Trimboli
------------------------------
Title: Assistant Treasurer
<PAGE>
EXECUTION COPY
$500,000,000
THE HOME DEPOT, INC.
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
REGISTRATION RIGHTS AGREEMENT
September 27, 1999
Credit Suisse First Boston Corporation
Invemed Associates LLC
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Ladies and Gentlemen:
THE HOME DEPOT, INC., a Delaware corporation (the "COMPANY"), proposes
to issue and sell to Credit Suisse First Boston Corporation, and Invemed
Associates LLC (together, the "INITIAL PURCHASERS"), upon the terms set forth in
a purchase agreement of even date herewith (the "PURCHASE AGREEMENT"),
$500,000,000 aggregate principal amount of its 6 1/2% Senior Notes due September
15, 2004 (the "INITIAL SECURITIES"). The Initial Securities will be issued
pursuant to an Indenture, dated as of September 27, 1999, (the "INDENTURE"),
between the Company and The Bank of New York, a New York banking corporation, as
trustee (the "TRUSTEE"). As an inducement to the Initial Purchasers to enter
into the Purchase Agreement, the Company agrees with the Initial Purchasers, for
the benefit of the holders of the Initial Securities (including, without
limitation, the Initial Purchasers), the Exchange Securities (as defined below)
and any Private Exchange Securities (as defined below) (collectively the
"HOLDERS"), as follows:
1. REGISTERED EXCHANGE OFFER. Unless not permitted by applicable law
(after the Company has complied with the ultimate paragraph of this Section 1),
the Company shall prepare and, not later than 90 days (such 90th day being a
"FILING DEADLINE") after the date on which the Initial Purchasers purchase the
Initial Securities pursuant to the Purchase Agreement (the "CLOSING DATE"), file
with the Securities and Exchange Commission (the "COMMISSION") a registration
statement (the "EXCHANGE OFFER REGISTRATION STATEMENT") on an appropriate form
under the Securities Act of 1933, as amended (the "SECURITIES ACT"), with
respect to a proposed offer (the "REGISTERED EXCHANGE OFFER") to the Holders of
<PAGE>
Transfer Restricted Securities (as defined in Section 6 hereof), who are not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer, to issue and deliver to such Holders, in exchange for
the Initial Securities, a like aggregate principal amount of debt securities of
the Company issued under the Indenture, identical in all material respects to
the Initial Securities (except for the transfer restrictions relating to the
Initial Securities) and registered under the Securities Act (the "EXCHANGE
SECURITIES"). The Company shall use its commercially reasonable efforts to (i)
cause such Exchange Offer Registration Statement to become effective under the
Securities Act within 180 days after the Closing Date (such 180th day being an
"EFFECTIVENESS DEADLINE") and (ii) keep the Exchange Offer Registration
Statement effective for not less than 20 business days (or longer, if required
by applicable law) after the date notice of the Registered Exchange Offer is
mailed to the Holders (such period being called the "EXCHANGE OFFER REGISTRATION
PERIOD").
If the Company commences the Registered Exchange Offer, the Company (i)
will be entitled to consummate the Registered Exchange Offer 30 days after such
commencement (provided that the Company has accepted all the Initial Securities
theretofore validly tendered in accordance with the terms of the Registered
Exchange Offer) and (ii) will be required to consummate the Registered Exchanged
Offer no later than 40 days after the date on which the Exchange Offer
Registration Statement is declared effective (such 40th day being the
"CONSUMMATION DEADLINE").
Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder of Transfer Restricted Securities (as defined in Section 6
hereof) electing to exchange Initial Securities for Exchange Securities
(assuming that such Holder is not an affiliate of the Company within the meaning
of the Securities Act, acquires the Exchange Securities in the ordinary course
of such Holder's business, has no arrangements with any person to participate in
the distribution of the Exchange Securities and is not prohibited by any law or
policy of the Commission from participating in the Registered Exchange Offer) to
trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act (other than the prospectus
delivery requirements referred to in clause (i) of the next paragraph, if and to
the extent applicable) and without material restrictions under the securities
laws of the several states of the United States.
The Company acknowledges that, pursuant to current interpretations by
the Commission's staff of Section 5 of the Securities Act, in the absence of an
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applicable exemption therefrom, (i) each Holder that is a broker-dealer electing
to exchange Initial Securities, acquired for its own account as a result of
market making activities or other trading activities, for Exchange Securities
(an "EXCHANGING DEALER"), is required to deliver a prospectus containing the
information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in
the "Exchange Offer Procedures" section and the "Purpose of the Exchange Offer"
section, and (c) Annex C hereto in the "Plan of Distribution" section of such
prospectus in connection with a sale of any such Exchange Securities received by
such Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) an
Initial Purchaser that elects to sell Private Exchange Securities (as defined
below) acquired in exchange for Initial Securities constituting any portion of
an unsold allotment is required to deliver a prospectus containing the
information required by Items 507 or 508 of Regulation S-K under the Securities
Act, as applicable, in connection with such sale.
The Company shall use its commercially reasonable efforts to keep the
Exchange Offer Registration Statement effective and to amend and supplement the
prospectus contained therein, in order to permit such prospectus to be lawfully
delivered by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; PROVIDED, HOWEVER, that
(i) in the case where such prospectus and any amendment or supplement thereto
must be delivered by an Exchanging Dealer or an Initial Purchaser, such period
shall be the lesser of 135 days and the date on which all Exchanging Dealers and
the Initial Purchasers have sold all Exchange Securities held by them (unless
such period is extended pursuant to Section 3(j) below) and (ii) the Company
shall make such prospectus and any amendment or supplement thereto available to
any broker-dealer for use in connection with any resale of any Exchange
Securities for a period of not less than 135 days after the consummation of the
Registered Exchange Offer.
If, upon consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company, simultaneously with the delivery of the Exchange
Securities pursuant to the Registered Exchange Offer, shall issue and deliver to
such Initial Purchaser upon the written request of such Initial Purchaser, in
exchange (the "PRIVATE EXCHANGE") for (a) the Initial Securities held by such
Initial Purchaser, a like principal amount of debt securities of the Company
issued under the Indenture and identical in all material respects (including the
existence of restrictions on transfer under the Securities Act and the
securities laws of the several states of the United States) to the Initial
Securities (the "PRIVATE EXCHANGE SECURITIES"). The Initial Securities, the
Exchange Securities and the Private Exchange Securities are herein collectively
called the "SECURITIES".
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In connection with the Registered Exchange Offer, the Company shall:
(a) mail to each Holder a copy of the definitive prospectus
forming part of the Exchange Offer Registration Statement, together
with an appropriate letter of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than 20
business days (or longer, if required by applicable law) after the date
notice thereof is mailed to the Holders;
(c) utilize the services of a depositary for the Registered
Exchange Offer with an address in the Borough of Manhattan, The City of
New York, which may be the Trustee or an affiliate of the Trustee;
(d) permit Holders to withdraw tendered Securities at any time
prior to the close of business, New York time, on the last business day
on which the Registered Exchange Offer shall remain open; and
(e) otherwise comply with all applicable laws.
As soon as practicable after the close of the Registered Exchange Offer
or the Private Exchange, as the case may be, the Company shall:
(x) accept for exchange all the Securities validly tendered and
not withdrawn pursuant to the Registered Exchange Offer and the Private
Exchange;
(y) deliver to the Trustee for cancellation all the Initial
Securities so accepted for exchange; and
(z) cause the Trustee to authenticate and deliver promptly to each
Holder of the Initial Securities, Exchange Securities or Private
Exchange Securities, as the case may be, equal in principal amount to
the Initial Securities of such Holder so accepted for exchange.
The Indenture will provide that the Exchange Securities will not be
subject to the transfer restrictions set forth in the Indenture and that all the
Securities will vote and consent together on all matters as one class and that
none of the Securities will have the right to vote or consent as a class
separate from one another on any matter.
Interest on each Exchange Security and Private Exchange Security issued
pursuant to the Registered Exchange Offer and in the Private Exchange will
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<PAGE>
accrue from the last interest payment date on which interest was paid on the
Initial Securities surrendered in exchange therefor or, if no interest has been
paid on the Initial Securities, from the date of original issue of the Initial
Securities.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company in writing that at the time of the
consummation of the Registered Exchange Offer (i) any Exchange Securities
received by such Holder will be acquired in the ordinary course of business,
(ii) such Holder will have no arrangements or understanding with any person to
participate in the distribution of the Initial Securities or the Exchange
Securities within the meaning of the Securities Act, (iii) such Holder is not an
"affiliate," as defined in Rule 405 of the Securities Act, of the Company or if
it is an affiliate, such Holder will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable, (iv) such
Holder is not engaged in, and does not intend to engage in, the distribution of
the Exchange Securities and (v) if such Holder is a broker-dealer, that it will
receive Exchange Securities for its own account in exchange for Initial
Securities that were acquired as a result of market-making activities or other
trading activities and that it will deliver a prospectus in connection with any
resale of such Exchange Securities.
Notwithstanding any other provisions hereof, the Company will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies as to
form in all material respects with the Securities Act and the rules and
regulations thereunder, (ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, 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
(iii) any prospectus forming part of any Exchange Offer Registration Statement,
and any supplement to such prospectus, does not as of its date include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
2. SHELF REGISTRATION. If, (i) because of any change in law or in
applicable interpretations thereof by the staff of the Commission, the Company
is not permitted to effect a Registered Exchange Offer, as contemplated by
Section 1 hereof, (ii) the Registered Exchange Offer is not consummated within
220 days of the Issue Date, (iii) any Initial Purchaser so requests within 10
business days following consummation of the Registration Exchange Offer with
respect to the Initial Securities not eligible to be exchanged for Exchange
Securities in the Registered Exchange Offer (or the Private Exchange Securities)
and held by it following consummation of the Registered Exchange Offer or (iv)
any Holder of
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Transfer Restricted Securities (other than an Exchanging Dealer) shall notify
the Company within 10 business days following consummation of the Registered
Exchange Offer that it is not eligible to participate in the Registered Exchange
Offer or, in the case of any Holder (other than an Exchanging Dealer) that
participates in the Registered Exchange Offer, such Holder does not receive
freely tradeable Exchange Securities on the date of the exchange, the Company
shall take the following actions (the date on which any of the conditions
described in the foregoing clauses (i) through (iv) occur, including in the case
of clauses (iii) or (iv) the receipt of the required notice, being a "TRIGGER
DATE"):
(a) The Company shall, at its cost, as promptly as practicable
(but in no event more than 90 days after the Trigger Date (such 90th
day being a "FILING DEADLINE")) file with the Commission and thereafter
shall use its commercially reasonable efforts to cause to be declared
effective no later than 180 days after the Trigger Date (such 180th day
being an "EFFECTIVE DEADLINE") a registration statement (the "SHELF
REGISTRATION STATEMENT" and, together with the Exchange Offer
Registration Statement, a "REGISTRATION STATEMENT") on an appropriate
form under the Securities Act relating to the offer and sale of the
Transfer Restricted Securities (as defined in Section 6 hereof) by the
Holders thereof from time to time in accordance with the methods of
distribution set forth in the Shelf Registration Statement and Rule 415
under the Securities Act (hereinafter, the "SHELF REGISTRATION");
PROVIDED, HOWEVER, that no Holder (other than an Initial Purchaser)
shall be entitled to have the Transfer Restricted Securities held by it
covered by such Shelf Registration Statement unless such Holder (i)
agrees in writing to be bound by all the provisions of this Agreement
applicable to such Holder and (ii) provides the Company in writing with
the information required by Section 3(n).
(b) The Company shall use its commercially reasonable efforts to
keep the Shelf Registration Statement continuously effective in order
to permit the prospectus included therein to be lawfully delivered by
the Holders of the relevant Transfer Restricted Securities for a period
of two years (or for such longer period if extended pursuant to Section
3(j) below) from the date of its effectiveness or such shorter period
that will terminate when all the Securities covered by the Shelf
Registration Statement (i) have been sold pursuant thereto or (ii) are
no longer restricted securities (as defined in Rule 144 under the
Securities Act, or any successor rule thereof); provided, however, that
the Company shall not be obligated to keep the Shelf Registration
Statement continuously effective to the extent set forth above, or to
keep the prospectus included therein usable for offers and sales of
Securities, if (i) the Company determines, in its reasonable judgment,
upon the advice of counsel, that the continued effectiveness of
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the Shelf Registration Statement or usability of any prospectus
included therein would (x) require the disclosure of material
information, which the Company has a bona fide business reason for
preserving as confidential, or (y) interfere with any financing,
acquisition, corporate reorganization or other material transaction or
development involving the Company or any of its subsidiaries or the
contemplated timing thereof, and (ii) the Company promptly thereafter
complies with the requirements of Section 3(j) hereof, if applicable.
The number of days of any actual Suspension Period (as defined below)
shall be added on to the end of the two-year period specified above.
Any such period during which the Company is excused from keeping the
Shelf Registration Statement effective and the prospectus included
therein usable for offers and sales of Securities is referred to herein
as a "SUSPENSION PERIOD." A Suspension Period shall commence on and
include the date that the Company gives notice that the Shelf
Registration Statement is no longer effective or the prospectus
included therein is no longer usable for offers and sales of Securities
and shall end on the earlier to occur of (1) the date on which each
seller of Securities covered by the Shelf Registration Statement either
receives the copies of the supplemented or amended prospectus
contemplated by Section 3(j) hereof or is advised in writing by the
Company that the use of the prospectus may be resumed, and (2) the
occurrence of a Suspension Period Limit (as defined below). There shall
be no more than three Suspension Periods in any 12-month period, the
aggregate number of days of such Suspension Periods shall not exceed 90
days in such 12 month period (collectively, the "SUSPENSION PERIOD
LIMITS") and no Suspension Period shall exceed 60 days. The Company
shall be deemed not to have used its commercially reasonable efforts to
keep the Shelf Registration Statement effective during the requisite
period if it voluntarily takes any action that would result in Holders
of Securities covered thereby not being able to offer and sell such
Securities during that period, unless such action is required by
applicable law.
(c) Notwithstanding any other provisions of this Agreement to the
contrary, the Company shall cause the Shelf Registration Statement and
the related prospectus and any amendment or supplement thereto, as of
the effective date of the Shelf Registration Statement, amendment or
supplement, (i) to comply as to form in all material respects with the
applicable requirements of the Securities Act and the rules and
regulations of the Commission and (ii) not to contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
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3. REGISTRATION PROCEDURES. In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any Registered
Exchange Offer contemplated by Section 1 hereof, the following provisions shall
apply:
(a) The Company shall (i) furnish to each Initial Purchaser, prior
to the filing thereof with the Commission, a copy of the Registration
Statement and each amendment thereof and each supplement, if any, to
the prospectus included therein and, in the event that an Initial
Purchaser (with respect to any portion of an unsold allotment of
Initial Securities) is participating in the Registered Exchange Offer
or the Shelf Registration Statement, the Company shall use its
reasonable best efforts to reflect in each such document, when so filed
with the Commission, such comments as such Initial Purchaser reasonably
may propose; (ii) include the information set forth in Annex A hereto
on the cover, in Annex B hereto in the "Exchange Offer Procedures"
section and the "Purpose of the Exchange Offer" section and in Annex C
hereto in the "Plan of Distribution" section of the prospectus forming
a part of the Exchange Offer Registration Statement and include the
information set forth in Annex D hereto in the Letter of Transmittal
delivered pursuant to the Registered Exchange Offer, (iii) if requested
by an Initial Purchaser, include the information required by Items 507
or 508 of Regulation S-K under the Securities Act, as applicable, in
the prospectus forming a part of the Exchange Offer Registration
Statement; (iv) include within the prospectus contained in the Exchange
Offer Registration Statement a section entitled "Plan of Distribution"
attached hereto as Exhibit 3(a), reasonably acceptable to the Initial
Purchasers, which shall contain a summary statement of the positions
taken or policies made by the staff of the Commission with respect to
the potential "underwriter" status of any broker-dealer that is the
beneficial owner (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT")) of Exchange
Securities received by such broker-dealer in the Registered Exchange
Offer (a "PARTICIPATING BROKER-DEALER"), whether such positions or
policies have been publicly disseminated by the staff of the Commission
or such positions or policies, in the reasonable judgment of the
Initial Purchasers based upon advice of counsel (which may be in-house
counsel), represent the prevailing views of the staff of the
Commission; and (v) in the case of a Shelf Registration Statement,
include the names of the Holders who propose to sell Securities
pursuant to the Shelf Registration Statement as selling
securityholders.
(b) The Company shall give written notice to the Initial
Purchasers when the Registration Statement or any amendment thereto has
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been filed with the Commission and shall give written notice to the
Initial Purchasers and (i) in the case of a Shelf Registration
Statement, the Holders of the Securities covered thereby, or (ii) in
the case of an Exchange Offer Registration Statement, the Holders of
the Initial Securities and any Participating Broker-Dealer from whom
the Company has received prior written notice that it will be a
Participating Broker-Dealer in the Registered Exchange Offer (which
notice pursuant to clauses (ii)-(v) hereof shall be accompanied by an
instruction to suspend the use of the prospectus until the requisite
changes have been made):
(i) when the Registration Statement or any post-effective
amendment thereto has been declared effective by the Commission;
(ii) of any request by the Commission for amendments or
supplements to the Registration Statement or the prospectus
included therein or for additional information;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by the Company or its legal counsel of
any notification with respect to the suspension of the
qualification of the Securities for sale in any jurisdiction or
the initiation or, threatening of any proceeding for such purpose;
and
(v) of the occurrence of any event, including, without
limitation, any event resulting in a Suspension Period, that
requires the Company to make changes in the Registration Statement
or the prospectus in order that the Registration Statement or the
prospectus do not contain an untrue statement of a material fact
nor omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the
prospectus, in light of the circumstances under which they were
made) not misleading.
(c) The Company shall make every reasonable effort to obtain the
withdrawal at the earliest possible time, of any order suspending the
effectiveness of the Registration Statement.
(d) The Company shall furnish to each Holder of Securities
included within the coverage of the Shelf Registration, without charge,
at
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least one copy of the Shelf Registration Statement and any
post-effective amendment thereto, including financial statements and
schedules, and, if the Holder so requests in writing, all exhibits
thereto (including those, if any, incorporated by reference).
(e) The Company shall deliver to each Exchanging Dealer and each
Initial Purchaser, and to any other Holder who so requests, without
charge, at least one copy of the Exchange Offer Registration Statement
and any post-effective amendment thereto, including financial
statements and schedules, and, if any Initial Purchaser or any such
Holder requests, all exhibits thereto (including those incorporated by
reference).
(f) The Company shall, during the Shelf Registration Period,
deliver to each Holder of Securities included within the coverage of
the Shelf Registration, without charge, as many copies of the
prospectus (including each preliminary prospectus) included in the
Shelf Registration Statement and any amendment or supplement thereto as
such person may reasonably request. The Company consents, subject to
the provisions of this Agreement, to the use of the prospectus or any
amendment or supplement thereto by each of the selling Holders of the
Securities in connection with the offering and sale of the Securities
covered by the prospectus, or any amendment or supplement thereto,
included in the Shelf Registration Statement.
(g) The Company shall deliver to each Initial Purchaser, any
Exchanging Dealer, any Participating Broker-Dealer and such other
persons required to deliver a prospectus following the Registered
Exchange Offer, without charge, as many copies of the final prospectus
included in the Exchange Offer Registration Statement and any amendment
or supplement thereto as such persons may reasonably request. The
Company consents, subject to the provisions of this Agreement, to the
use of the prospectus or any amendment or supplement thereto by any
Initial Purchaser, if necessary, any Participating Broker-Dealer and
such other persons required to deliver a prospectus following the
Registered Exchange Offer in connection with the offering and sale of
the Exchange Securities covered by the prospectus, or any amendment or
supplement thereto, included in such Exchange Offer Registration
Statement.
(h) Prior to any public offering of the Securities pursuant to any
Registration Statement the Company shall register or qualify or
cooperate with the Holders of the Securities included therein and their
respective counsel in connection with the registration or qualification
of such Securities for offer and sale under the securities or "blue
sky" laws of such
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states of the United States as any Holder of such Securities reasonably
requests in writing and do any and all other acts or things reasonably
necessary or advisable to enable the offer and sale in such
jurisdictions of the Securities covered by such Registration Statement;
PROVIDED, HOWEVER, that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it is not
then so qualified or (ii) take any action which would subject it to
general service of process or to taxation in any jurisdiction where it
is not then so subject.
(i) The Company shall cooperate with the Holders of the Securities
to facilitate the timely transfer of the Securities to be sold pursuant
to any Registration Statement free of any restrictive legends and, to
the extent consistent with the terms of the Indenture, facilitate the
timely preparation and delivery of certificates representing the
Securities in such denominations and registered in such names as the
Holders may request a reasonable period of time prior to sales of the
Securities pursuant to such Registration Statement.
(j) Upon the occurrence of any event (other than an event
resulting in a Suspension Period, in which case the Company must comply
with this Section 3(j) within 90 days of the termination of such
Suspension Period) contemplated by paragraphs (ii) through (v) of
Section 3(b) above during the period for which the Company is required
to maintain an effective Registration Statement, the Company shall
promptly prepare and file a post-effective amendment to the
Registration Statement or a supplement to the related prospectus and
any other required document so that, as thereafter delivered to Holders
of Securities or purchasers of Securities, the prospectus will not
contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading. If the Company notifies the Initial Purchasers,
the Holders of the Securities and any known Participating Broker-Dealer
in accordance with paragraphs (ii) through (v) of Section 3(b) above to
suspend the use of the prospectus until the requisite changes to the
prospectus have been made, then the Initial Purchasers, the Holders of
the Securities and any such Participating Broker-Dealers shall suspend
use of such prospectus, and the period of effectiveness of the Shelf
Registration Statement provided for in Section 2(b) above and the
Exchange Offer Registration Statement provided for in Section 1 above
shall each be extended by the number of days, without duplication of
any extension under Section 2(b), from and including the date of the
giving of such notice to and including the date when the Initial
Purchasers, the Holders of the Securities and any known Participating
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Broker-Dealer, as applicable, shall have received such amended or
supplemented prospectus pursuant to this Section 3(j) or the date when
none of the Securities represent Transfer Restricted Securities.
(k) Not later than the effective date of the applicable
Registration Statement, the Company will provide a CUSIP number for the
Initial Securities, the Exchange Securities or the Private Exchange
Securities, as the case may be, and provide the applicable trustee with
certificates for the Initial Securities, the Exchange Securities or the
Private Exchange Securities, as the case may be, in a form eligible for
deposit with The Depository Trust Company.
(l) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the
Registered Exchange Offer or the Shelf Registration and will make
generally available to its security holders (or otherwise provide in
accordance with Section 11(a) of the Securities Act) an earnings
statement satisfying the provisions of Section 11(a) of the Securities
Act, no later than 45 days after the end of a 12-month period (or 90
days, if such period is a fiscal year) beginning with the first month
of the Company's first fiscal quarter commencing after the effective
date of the Registration Statement, which statement shall cover such
12-month period.
(m) The Company shall cause the Indenture to be qualified under
the Trust Indenture Act of 1939, as amended, in a timely manner and
containing such changes, if any, as shall be necessary for such
qualification. 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.
(n) The Company may require each Holder of Securities to be sold
pursuant to the Shelf Registration Statement to furnish to the Company
such information, including the information specified in Item 507 or
Item 508 of Regulation S-K, as applicable, under the Securities Act,
regarding the Holder and the distribution of the Securities as the
Company may from time to time reasonably require for inclusion in the
Shelf Registration Statement, and the Company may exclude from such
registration the Securities of any Holder that fails to furnish such
information within a reasonable time after receiving such request. The
failure to include in the Shelf Registration Statement any Holder who
shall have not provided all such information shall not constitute a
Registration Default (as defined in Section 6(a) hereof). The Company
may require
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<PAGE>
each Holder as to which a Shelf Registration Statement is effected to
furnish, update or confirm promptly to the Company information
regarding the Holder and the distribution of Securities required to be
disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.
(o) The Company shall enter into such customary agreements
(including, if requested, an underwriting agreement in customary form)
and take a such other action, if any, as any Holder of the Securities
shall reasonably request in order to facilitate the disposition of the
Securities pursuant to any Shelf Registration.
(p) In the case of any Shelf Registration, the Company shall (i)
upon reasonable notice and during normal business hours, make
reasonably available for inspection by any underwriter participating in
any disposition pursuant to the Shelf Registration Statement and any
attorney, accountant or other agent retained by such Holders of the
Securities or any such underwriter all relevant financial and other
records, pertinent corporate documents and properties of the Company
and (ii) use its reasonable best efforts to cause the Company's
officers, directors, employees, accountants and auditors to supply all
relevant information reasonably requested by any such underwriter,
attorney, accountant or agent in connection with the Shelf Registration
Statement, in each case, as shall be reasonably necessary to enable
such persons, to conduct a reasonable investigation within the meaning
of Section 11 of the Securities Act; PROVIDED, HOWEVER, that any
information that is designated in writing by the Company in good faith
as confidential at the time of delivery of such information shall be
kept confidential by such Holder or any such underwriter, attorney,
accountant or agent, unless such disclosure is made in the public
generally or through a third party without an accompanying obligation
of confidentiality; and PROVIDED, FURTHER, that the foregoing
inspection and information gathering shall be coordinated on behalf of
the Initial Purchasers by you and on behalf of the other parties, by
one counsel designated by and on behalf of such other parties as
described in Section 4 hereof.
(q) In the case of any Shelf Registration, the Company, if
requested by any Holder of Securities covered thereby, shall cause (i)
its counsel to deliver an opinion and updates thereof relating to the
Securities in customary form and substance substantially similar to
that customarily delivered in public offerings of Securities addressed
to such Holders and the managing underwriters, if any, thereof and
dated, in the case of the initial opinion, the effective date of such
Shelf Registration Statement; (ii)
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<PAGE>
its officers to execute and deliver all customary documents and
certificates and updates thereof requested by any underwriters of the
applicable Securities and (iii) its independent public accountants to
provide to the selling Holders of the applicable Securities and any
underwriter therefor a comfort letter in customary form and covering
matters of the type customarily covered in comfort letters in
connection with primary underwritten offerings, subject to receipt of
appropriate documentation as contemplated, and only if permitted, by
Statement of Auditing Standards No. 72.
(r) In the case of the Registered Exchange Offer, if requested by
any Initial Purchaser or any known Participating Broker-Dealer, the
Company shall cause (i) its counsel to deliver to such Initial
Purchaser or such Participating Broker-Dealer signed opinion in the
form set forth in Section 6(c) of the Purchase Agreement with such
changes as are customary in connection with the preparation of a
Registration Statement and (ii) its independent public accountants to
deliver to such Initial Purchaser or such Participating Broker-Dealer a
comfort letter, in customary form, meeting the requirements as to the
substance thereof as set forth in Section 6(a) of the Purchase
Agreement, with appropriate date changes.
(s) If a Registered Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Initial Securities by Holders to the
Company (or to such other Person as directed by the Company) in
exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be, the Company shall mark, or cause to be
marked, on the Initial Securities so exchanged that such Initial
Securities are being canceled in exchange for the Exchange Securities
or the Private Exchange Securities, as the case may be; in no event
shall the Initial Securities be marked as paid or otherwise satisfied.
(t) The Company will use its reasonable best efforts to (i) if the
Initial Securities have been rated prior to the initial sale of such
Initial Securities, confirm such ratings will apply to the Securities
covered by a Registration Statement, or (ii) if the Initial Securities
were not previously rated, cause the Securities covered by a
Registration Statement to be rated with the appropriate rating
agencies, if so requested by Holders of a majority in aggregate
principal amount of Securities covered by such Registration Statement,
or by the managing underwriters, if any.
(u) In the event that any broker-dealer registered under the
Exchange Act shall underwrite any Securities to be sold pursuant to the
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<PAGE>
Shelf Registration Statement 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 "RULES") of the National
Association of Securities Dealers, Inc. ("NASD")) thereof, whether as a
Holder of such Securities or as an underwriter, a placement or sales
agent or a broker or dealer in respect thereof, or otherwise, the
Company will assist such broker-dealer in complying with the
requirements of such Rules, including, without limitation, by (i) if
such Rules, including Rule 2720, shall so require, engaging a
"qualified independent underwriter" (as defined in Rule 2720) to
participate in the preparation of the Registration Statement relating
to such Securities, to exercise usual standards of due diligence in
respect thereto and, if any portion of the offering contemplated by
such Registration Statement is an underwritten offering or is made
through a placement or sales agent, to recommend the yield of such
Securities, (ii) indemnifying any such qualified independent
underwriter to the extent of the indemnification of underwriters
provided in Section 5 hereof and (iii) providing such information to
such broker-dealer as may be required in order for such broker-dealer
to comply with the requirements of the Rules.
(v) The Company shall use its best efforts to take all other steps
necessary to effect the registration of the Securities covered by a
Registration Statement contemplated hereby.
4. REGISTRATION EXPENSES. (a) All expenses incident to the Company's
performance of and compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement is ever filed or becomes
effective, including without limitation:
(i) all registration and filing fees and expenses;
(ii) all fees and expenses of compliance with federal
securities and state "blue sky" or securities laws;
(iii) all expenses of printing (including printing
certificates for the Securities to be issued in the Registered
Exchange Offer and the Private Exchange and printing of
prospectuses), messenger and delivery services and telephone;
(iv) all fees and disbursements of counsel for the Company;
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<PAGE>
(v) all application and filing fees in connection with
listing the Exchange Securities on a national securities exchange
or automated quotation system pursuant to the requirements hereof;
and
(vi) all fees and disbursements of independent certified
public accountants of the Company (including the expenses of any
special audit and comfort letters required by or incident to such
performance).
The Company will bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and expenses
of any person, including special experts, retained by the Company.
(b) In connection with any Registration Statement required by this
Agreement, the Company will reimburse the Initial Purchasers and the
Holders of Transfer Restricted Securities who are tendering Initial
Securities in the Registered Exchange Offer and/or selling or reselling
Securities pursuant to the "Plan of Distribution" contained in the
Exchange Offer Registration Statement of the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements
(which fees and disbursements shall be limited to $10,000) of not more
than one counsel, who shall be Davis Polk & Wardwell unless another
firm shall be chosen by the Holders of a majority in principal amount
of the Transfer Restricted Securities for whose benefit such
Registration Statement is being prepared.
5. INDEMNIFICATION. (a) The Company will indemnify and hold harmless
each Holder of the Securities and any Participating Broker-Dealer and each
person, and their respective officers, directors and, in the case of
transactions pursuant to Section 3(o) hereof, underwriters and each person who
controls such Holder or such Participating Broker-Dealer within the meaning of
the Securities Act or the Exchange Act (each Holder, any Participating
Broker-Dealer and such controlling persons are referred to collectively as the
"INDEMNIFIED PARTIES") from and against any losses, claims, damages or
liabilities, joint or several, or any actions in respect thereof (including, but
not limited to, any losses, claims, damages, liabilities or actions relating to
purchases and sales of the Securities) to which each Indemnified Party may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in a Registration Statement or prospectus or in any amendment or
supplement thereto or in any preliminary prospectus relating
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<PAGE>
to a Shelf Registration, 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, in the light of the circumstances
under which they were made, not misleading, and shall reimburse, as incurred,
the Indemnified Parties for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action in respect thereof, PROVIDED, HOWEVER, that (i) the Company
shall not be liable in any such case to the extent that such loss, claim,
damage, liability or action arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Shelf Registration in reliance
upon and in conformity with written information pertaining to such Holder and
furnished to the Company by or on behalf of such Indemnified Party or any
affiliate thereof specifically for inclusion therein and (ii) with respect to
any untrue statement or omission or alleged untrue statement or omission made in
any preliminary prospectus relating to a Shelf Registration Statement, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Holder or Participating Broker-Dealer from whom the person
asserting any such losses, claims, damages or liabilities purchased the
Securities concerned (or any affiliate of such Holder or Participating
Broker-Dealer), to the extent that a prospectus relating to such Securities was
required to be delivered by such Holder or Participating Broker-Dealer under the
Securities Act in connection with such purchase and any such loss, claim, damage
or liability of such Holder or Participating Broker-Dealer or any affiliate
thereof results from the fact that there was not sent or given to such person,
at or prior to the written confirmation of the sale of such Securities to such
person, a copy of the final prospectus if the Company had previously furnished
copies thereof to such Holder or Participating Broker-Dealer; PROVIDED FURTHER,
HOWEVER, that this indemnity agreement will be in addition to any liability
which the Company may otherwise have to such Indemnified Party. The Company
shall also indemnify underwriters, their officers and directors and each person
who controls such underwriters within the meaning of the Securities Act or the
Exchange Act to the same extent as provided above with respect to the
indemnification of the Holders of the Securities if requested by such Holders.
(b) Each Holder of the Securities, severally and not jointly, will
indemnify and hold harmless the Company and each person, if any, who
controls the Company within the meaning of the Securities Act or the
Exchange Act from and against any losses, claims, damages or
liabilities or any actions in respect thereof, to which the Company or
any such controlling person may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact
contained in a
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Registration Statement or prospectus or in any amendment or supplement
thereto or in any preliminary prospectus relating to a Shelf
Registration, 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, in the light of the
circumstances under which they were made, not misleading, but in each
case only to the extent that the untrue statement or omission or
alleged untrue statement or alleged omission was made in reliance upon
and in conformity with written information pertaining to such Holder
and furnished to the Company by or on behalf of such Holder
specifically for inclusion therein; and, subject to the limitation set
forth immediately preceding this clause, shall reimburse, as incurred,
the Company for any legal or other expenses reasonably incurred by the
Company or any such controlling person in connection with investigating
or defending any loss, claim, damage, liability or action in respect
thereof. This indemnity agreement will be in addition to any liability
which such Holder may otherwise have to the Company or any of its
controlling persons.
(c) Promptly after receipt by an indemnified party under this
Section 5 of notice of the commencement of any action or proceeding
(including a governmental investigation), such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying
party under this Section 5, notify the indemnifying party in writing of
the commencement thereof; but the omission so to notify the
indemnifying party will not, in any event, relieve the indemnifying
party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a) or (b) above. In
case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may 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 (which consent shall
not be unreasonably withheld), 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 the indemnifying party
will not be liable to such indemnified party under this Section 5 for
any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in
connection with the defense thereof. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such
settlement includes an unconditional release of such indemnified party
from all liability on any claims that are the subject matter of such
action, and does not include a statement as to or an admission of
fault, culpability or failure to act by or on behalf of any indemnified
party.
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<PAGE>
(d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to in subsection (a) or (b) above (i) in such
proportion as is appropriate to reflect the relative benefits received
by the indemnifying party or parties on the one hand and the
indemnified party on the other from the exchange of the Securities,
pursuant to the transactions contemplated by the applicable
Registration Statement or prospectus, or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative
fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or
omissions that 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 the parties shall be determined
by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company
on the one hand or such Holder or such other indemnified party, as the
case may be, on the other, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the
first sentence of this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any action or claim which
is the subject of this subsection (d). Notwithstanding any other
provision of this Section 5(d), the Holders of the Securities shall not
be required to contribute any amount in excess of the amount by which
the net proceeds received by such Holders from the sale of the
Securities pursuant to a Registration Statement exceeds the amount of
damages which such Holders have 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. For purposes of this paragraph (d), each
person, if any, who controls such indemnified party within the meaning
of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party and each person, if any, who
controls the Company within the meaning of the Securities Act or the
Exchange Act shall have the same rights to contribution as the Company.
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(e) The agreements contained in this Section 5 shall survive the
sale of the Securities pursuant to a Registration Statement and shall
remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on
behalf of any indemnified party.
6. ADDITIONAL INTEREST UNDER CERTAIN CIRCUMSTANCES. (a) Additional
interest (the "ADDITIONAL INTEREST") with respect to the Initial Securities and
the Private Exchange Securities shall be assessed as follows if any of the
following events occur (each such event in clauses (i) through (iv) below a
"REGISTRATION DEFAULT":
(i) any Registration Statement required by this Agreement
is not filed with the Commission on or prior to the applicable
Filing Deadline;
(ii) any Registration Statement required by this Agreement
is not declared effective by the Commission on or prior to the
applicable Effectiveness Deadline;
(iii) the Registered Exchange Offer has not been consummated
on or prior to the Consummation Deadline; or
(iv) any Registration Statement required by this Agreement
has been declared effective by the Commission but (A) such
Registration Statement thereafter ceases to be effective or (B)
such Registration Statement or the related prospectus ceases to be
usable in connection with resales of Transfer Restricted
Securities during the periods specified herein because either (1)
any event occurs as a result of which the related prospectus
forming part of such Registration Statement would include any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or (2) it
shall be necessary to amend such Registration Statement or
supplement the related prospectus, to comply with the Securities
Act or the Exchange Act or the respective rules thereunder.
Each of the foregoing will constitute a Registration Default whatever the reason
for any such event and whether it is voluntary or involuntary or is beyond the
control of the Company or pursuant to operation of law or as a result of any
action or inaction by the Commission.
Additional Interest shall accrue on the Securities over and above the
interest set forth in the title of the Securities from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all
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such Registration Defaults have been cured, at a rate of 0.50% per annum (the
"ADDITIONAL INTEREST RATE") (regardless of the number of Registration Defaults).
(b) A Registration Default referred to in Section 6(a)(iii) hereof
shall be deemed not to have occurred and be continuing in relation to a
Shelf Registration Statement or the related prospectus during any
Suspension Period if (i) such Registration Default has occurred solely
as a result of (x) the filing of a post-effective amendment to such
Shelf Registration Statement to incorporate annual audited financial
information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to
permit Holders to use the related prospectus or (y) other material
events, with respect to the Company that would need to be described in
such Shelf Registration Statement or the related prospectus and (ii) in
the case of clause (y), the Company is proceeding promptly and in good
faith to amend or supplement such Shelf Registration Statement and
related prospectus to describe such events; PROVIDED, HOWEVER, that in
any case if such Registration Default occurs for a continuous period in
excess of 30 days, Additional Interest shall be payable in accordance
with the above paragraph from the day such Registration Default occurs
until such Registration Default is cured.
(c) Any amounts of Additional Interest due pursuant to Section
6(a) above will be payable in cash on the regular interest payment
dates with respect to the Securities. The amount of Additional Interest
will be determined by multiplying the applicable Additional Interest
rate by the principal amount of the Initial Securities or Private
Exchange Notes, as the case may be, multiplied by a fraction, the
numerator of which is the number of days such Additional Interest rate
was applicable during such period (determined on the basis of a 360-day
year comprised of twelve 30-day months), and the denominator of which
is 360.
(d) "TRANSFER RESTRICTED SECURITIES" means each Security until (i)
the date on which such Security has been exchanged by a person other
than a broker-dealer for a freely transferable Exchange Security in the
Registered Exchange Offer, (ii) following the exchange by a
broker-dealer in the Registered Exchange Offer of an Initial Security
for an Exchange Security, the date on which such Exchange Security is
sold to a purchaser who receives from such broker-dealer on or prior to
the date of such sale a copy of the prospectus contained in the
Exchange Offer Registration Statement, (iii) the date on which such
Security has been effectively registered under the Securities Act and
disposed of in accordance with the Shelf Registration Statement or (iv)
the date on which such Security is distributed to the public pursuant
to Rule 144 under the Securities Act or is saleable pursuant to Rule
144(k) under the Securities Act.
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7. RULES 144 AND 144A. The Company shall use its reasonable best
efforts to file the reports required to be filed by it under the Securities Act
and the Exchange Act in a timely manner and, if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Transfer Restricted Securities, make publicly available other information so
long as necessary to permit sales of their Transfer Restricted Securities
pursuant to Rules 144 and 144A. The Company covenants that it will take such
further action as any Holder of Transfer Restricted Securities may reasonably
request, all to the extent required from time to time to enable such Holder to
sell Transfer Restricted Securities without registration under the Securities
Act within the limitation of the exemptions provided by Rules 144 and 144A
(including the requirements of Rule 144A(d)(4)). The Company will provide a copy
of this Agreement to prospective purchasers of Initial Securities identified to
the Company by the Initial Purchasers upon request. Upon the request of any
Holder of Initial Securities, the Company shall deliver to such Holder a written
statement as to whether it has complied with such requirements. Notwithstanding
the foregoing, nothing in this Section 7 shall be deemed to require the Company
to register any of its securities pursuant to the Exchange Act.
8. UNDERWRITTEN REGISTRATIONS. If any of the Transfer Restricted
Securities covered by any Shelf Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or managers
that will administer the offering ("MANAGING UNDERWRITERS") will be selected by
the Holders of a majority in aggregate principal amount of such Transfer
Restricted Securities to be included in such offering (subject to the approval
(which approval shall not be unreasonably withheld) of the Company).
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably 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.
9. MISCELLANEOUS.
(a) AMENDMENTS AND WAIVERS. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, except by the
Company and the written consent of the Holders of a majority in
principal amount of the Securities affected by such amendment,
modification, supplement, waiver or consents.
22
<PAGE>
(b) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery,
first-class mail, facsimile transmission, or air courier which
guarantees overnight delivery:
(1) if to a Holder of the Securities, at the most current
address given by such Holder to the Company.
(2) if to the Initial Purchasers;
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, NY 10010-3629
Fax No.: (212) 325-8278
Attention: Transactions Advisory Group
with a copy to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
Fax No.: (212) 450-4800
Attention: Sarah Beshar
(3) if to the Company, at its address as follows:
The Home Depot, Inc.
2455 Paces Ferry Road, NW
Atlanta, GA 30339
Fax No.: (770) 384-2753
Attention: Dennis J. Carey
with a copy to:
The Home Depot, Inc.
2455 Paces Ferry Road, NW
Atlanta, GA 30339
Fax No.: (770) 384-2739
Attention: Kelly R. Caffarelli
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient's facsimile machine operator, if sent by facsimile
23
<PAGE>
transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery.
(c) NO INCONSISTENT AGREEMENTS. The Company has not, as of the
date hereof, entered into, nor shall it, on or after the date hereof,
enter into, any agreement with respect to its securities that is
inconsistent with the rights granted to the Holders herein or otherwise
conflicts with the provisions hereof.
(d) THIRD PARTY BENEFICIARIES. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on
the one hand, and the Initial Purchasers, on the other hand, and shall
have the right to enforce such agreements directly to the extent they
may deem such enforcement necessary or advisable to protect their
rights or the rights of Holders hereunder.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
the Company and its successors and assigns.
(f) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(g) HEADINGS. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning
hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
(i) SEVERABILITY. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
rem g provisions contained herein shall not be affected or impaired
thereby.
(j) SECURITIES HELD BY THE COMPANY. Whenever the consent or
approval of Holders of a specified percentage of principal amount of
Securities is required hereunder, Securities held by the Company or its
affiliates (other than subsequent Holders of Securities if such
subsequent Holders are deemed to be affiliates solely by reason of
their holdings of such Securities) shall not be counted in determining
whether such consent or approval was given by the Holders of such
required percentage.
24
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the several Initial Purchasers and the Company in accordance with its
terms.
Very truly yours,
THE HOME DEPOT, INC
By: /s/ Carol B. Tome
-------------------------------
Name: Carol B. Tome
Title: Vice President-Treasurer
The foregoing Registration
Rights Agreement is hereby confirmed
and accepted as of the date first
above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
INVEMED ASSOCIATES LLC
by: CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Andrew R. Taussig
------------------------------
Name: Andrew R. Taussig
Title: Managing Director
25
<PAGE>
ANNEX A
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. The Letter
of Transmittal states that by so acknowledging 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. 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 Exchange Securities received in exchange for Initial Securities
where such Initial Securities were acquired by such broker-dealer as a result of
market- making activities or other trading activities. The Company has agreed
that, for a period of 135 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution."
<PAGE>
ANNEX B
Each broker-dealer that receives Exchange Securities for its own
account in exchange for Initial Securities, where such Initial Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Securities. See "Plan of
Distribution."
<PAGE>
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities. 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 Exchange Securities received in
exchange for Initial Securities where such Initial Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 135 days after the Expiration Date, it will make
this prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, until [________ __], 1999,
all dealers effecting transactions in the Exchange Securities may be required to
deliver a prospectus.1
The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities 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 the Exchange Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale 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 any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were
received by it for its own account pursuant to the Exchange Offer and any broker
or dealer that participates in a distribution of such Exchange Securities may be
deemed to be an "underwriter" within the meaning of the Securities Act and any
profit on any such resale of Exchange Securities and any commission or
concessions received by any such persons 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.
- ----------
(1) In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Exchange Offer prospectus.
<PAGE>
For a period of 135 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Securities) other than commissions or concessions of any brokers
or dealers and will indemnify the Holders of the Securities (including any
broker-dealer) against certain liabilities, including liabilities under the
Securities Act.
<PAGE>
ANNEX D
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.
Name:
-------------------------------------
Address:
----------------------------------
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 Exchange
Securities. If the undersigned is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Initial Securities, it represents
that such Initial Securities were acquired by it as a result of market-making
activities or other trading activities, and acknowledges that it will deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such Exchange Securities; 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.
<PAGE>
EXHIBIT 5.1
October 29, 1999
The Home Depot, Inc.
2455 Paces Ferry Road, N.W.
Atlanta, Georgia 30339
Re: The Home Depot, Inc.--Registration Statement on Form S-4 relating to
$500,000,000 aggregate principal amount of 6 1/2% Senior Notes Due
September 15, 2004
Ladies and Gentlemen:
We have acted as counsel for The Home Depot, Inc., a Delaware corporation
(the "Company"), in connection with the preparation of a Registration Statement
on Form S-4 (the "Registration Statement") filed with the Securities and
Exchange Commission under the Securities Act of 1933 relating to the proposed
exchange of up to $500,000,000 aggregate principal amount of 6 1/2% Senior Notes
Due September 15, 2004 of the Company (the "New Notes") for a like principal
amount of the Company's issued and outstanding 6 1/2% Senior Notes Due
September 15, 2004 (the "Old Notes").
In our capacity as such counsel we have reviewed the Indenture (the
"Indenture") dated as of September 27, 1999 between the Company and The Bank of
New York, as trustee (the "Trustee"). We have also reviewed such matters of law
and examined original, certified, conformed or photographic copies of such other
documents, records, agreements and certificates as we have deemed necessary as a
basis for the opinions hereinafter expressed. In such review, we have assumed
the genuineness of signatures on all documents submitted to us as originals and
the conformity to original documents of all copies submitted to us as certified,
conformed or photographic copies, and, as to certificates of public officials,
we have assumed the same to have been properly given and to be accurate. As to
matters of fact material to this opinion, we have relied, without independent
investigation, upon statements and representations of representatives of the
Registrant and the Trustee and of public officials.
This opinion is limited in all respects to the federal laws of the United
States of America and the General Corporation Law of the State of Delaware and
the law of the State of New York, and no opinion is expressed with respect to
the laws of any other jurisdiction or any effect which such laws may have on the
opinions expressed herein. This opinion is limited to the matters stated herein,
and no opinion is implied or may be inferred beyond the matters expressly stated
herein.
Based upon the foregoing, and the other limitations and qualifications set
forth herein, we are of the opinion that (x) the New Notes have been duly
authorized by the Company and, when executed by the Company and duly
authenticated by the Trustee in accordance with the terms of the Indenture and
delivered in exchange for the Old Notes in accordance with the terms of the
Indenture, will constitute legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject, as to
enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally, general equitable
principles and the discretion of courts in granting equitable remedies and
(y) the Indenture has been duly authorized, executed and delivered by the
Company and, assuming due execution and delivery thereof by the Trustee,
constitutes a legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, subject, as to enforcement of
remedies, to bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, general equitable principles and the
discretion of courts in granting equitable remedies.
This opinion is given as of the date hereof, and we assume no obligation to
advise you after the date hereof of facts or circumstances that come to our
attention or changes in law that occur which could affect the opinions contained
herein. This opinion may not be furnished to or relied upon by any person or
entity for any purpose without our prior written consent.
<PAGE>
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the Prospectus that is included in the Registration Statement.
Very truly yours,
/s/ King & Spalding
<PAGE>
Exhibit 12.1
THE HOME DEPOT, INC.
RATIO OF EARNINGS TO FIXED CHARGES
($ in thousands, except ratio data)
<TABLE>
<CAPTION>
Six Months Ended
Fiscal Year (1) -----------------------
------------------------------------------------------------- August 2, August 1,
1994 1995 1996 1997 1998 1998 1999
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings before income taxes.......... $ 979,749 $1,195,303 $1,534,768 $1,898,470 $2,653,886 $1,324,802 $1,922,546
Less: Capitalized Interest............ (17,559) (20,767) (23,307) (19,055) (30,952) (12,180) (18,640)
Add:
Minority Interest expense (income) (381) (30) 8,371 15,726 (2,103) (1,139) (2,685)
Portion of rental expense under
operating leases deemed to be
the equivalent of interest........ 38,735 46,672 51,228 61,027 73,875 35,586 41,168
Interest Expense.................. 52,721 23,796 38,102 60,068 67,159 32,442 34,756
---------- ---------- ---------- ---------- ---------- ---------- ----------
Adjusted Earnings.................... $1,053,266 $1,244,974 $1,609,162 $2,016,235 $2,761,865 $1,379,511 $1,977,145
========== ========== ========== ========== ========== ========== ==========
Fixed Charges:
Interest Expense................. $ 52,721 $ 23,796 $ 38,102 $ 60,068 $ 67,159 $ 32,442 $ 34,756
Portion of rental expense under
operating leases deemed to be
the equivalent of interest....... 38,735 46,672 51,228 61,027 73,875 35,586 41,168
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Fixed Charges.................. $ 91,456 $ 70,468 $ 89,330 $ 121,095 $ 141,034 $ 68,028 $ 75,924
========== ========== ========== ========== ========== ========== ==========
Ratio of Earnings to Fixed Charges(2) 11.5x 17.7x 18.0x 16.7x 19.6x 20.3x 26.0x
</TABLE>
(1) Fiscal years 1994, 1995, 1996, 1997 and 1998 refer the fiscal years ended
January 29, 1995; January 28, 1996; February 2, 1997; February 1, 1998; and
January 31, 1999, respectively. Fiscal year 1996 consisted of 53 weeks.
(2) For purposes of computing the ratios of earnings to fixed charges,
"earnings" consist of earnings before income taxes and minority interest
plus fixed charges, excluding capitalized interest. "Fixed charges" consist
of interest incurred on indebtedness, amortization of debt expense and the
portion of rental expense under operating leases deemed to be the
equivalent of interest.
<PAGE>
EXHIBIT 23.2
The Board of Directors
The Home Depot, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG LLP
Atlanta, Georgia
October 29, 1999
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, Frank Borman, a director of The Home Depot, Inc., a Delaware corporation,
do hereby constitute and appoint Arthur M. Blank and Ronald M. Brill, jointly
and severally, my true and lawful attorneys-in-fact, each with full power of
substitution, for me in any and all capacities as a director or officer or both
of The Home Depot, Inc., a Delaware corporation (the "Corporation"), to sign,
pursuant to the requirements of the Securities Act of 1933, the Registration
Statement on Form S-4 relating to $500,000,000 aggregate principal amount of
6 1/2% Senior Notes Due September 15, 2004 to be issued by the Company in
exchange for a like amount of outstanding unregistered 6 1/2% Senior Notes Due
September 15, 2004 issued by the Company, and to file the same with the
Securities and Exchange Commission, together with all exhibits thereto and other
documents in connection therewith, including, such as are incorporated therein
by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ FRANK BORMAN
--------------------------------------
Frank Borman
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, John L. Clendenin, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ JOHN L. CLENDENIN
--------------------------------------
John L. Clendenin
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, Berry R. Cox, a director of The Home Depot, Inc., a Delaware corporation,
do hereby constitute and appoint Arthur M. Blank and Ronald M. Brill, jointly
and severally, my true and lawful attorneys-in-fact, each with full power of
substitution, for me in any and all capacities as a director or officer or both
of The Home Depot, Inc., a Delaware corporation (the "Corporation"), to sign,
pursuant to the requirements of the Securities Act of 1933, the Registration
Statement on Form S-4 relating to $500,000,000 aggregate principal amount of
6 1/2% Senior Notes Due September 15, 2004 to be issued by the Company in
exchange for a like amount of outstanding unregistered 6 1/2% Senior Notes Due
September 15, 2004 issued by the Company, and to file the same with the
Securities and Exchange Commission, together with all exhibits thereto and other
documents in connection therewith, including, such as are incorporated therein
by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ BERRY R. COX
--------------------------------------
Berry R. Cox
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, William S. Davila, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ WILLIAM S. DAVILA
--------------------------------------
William S. Davila
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, Milledge A. Hart, III, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ MILLEDGE A. HART, III
--------------------------------------
Milledge A. Hart, III
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, Bonnie G. Hill, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ BONNIE G. HILL
--------------------------------------
Bonnie G. Hill
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, Kenneth G. Langone, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ KENNETH G. LANGONE
--------------------------------------
Kenneth G. Langone
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
I, M. Faye Wilson, a director of The Home Depot, Inc., a Delaware
corporation, do hereby constitute and appoint Arthur M. Blank and Ronald M.
Brill, jointly and severally, my true and lawful attorneys-in-fact, each with
full power of substitution, for me in any and all capacities as a director or
officer or both of The Home Depot, Inc., a Delaware corporation (the
"Corporation"), to sign, pursuant to the requirements of the Securities Act of
1933, the Registration Statement on Form S-4 relating to $500,000,000 aggregate
principal amount of 6 1/2% Senior Notes Due September 15, 2004 to be issued by
the Company in exchange for a like amount of outstanding unregistered 6 1/2%
Senior Notes Due September 15, 2004 issued by the Company, and to file the same
with the Securities and Exchange Commission, together with all exhibits thereto
and other documents in connection therewith, including, such as are incorporated
therein by reference, and to sign on my behalf and in my stead, in any and all
capacities, any or all amendments and any or all post-effective amendments to
said Registration Statement, whether on Form S-4 or otherwise, incorporating
such changes as any of the said attorneys-in-fact deems appropriate, hereby
ratifying and confirming all that each of said attorney-in-fact deems
appropriate, and all that each of said attorneys-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 29th day of
October, 1999.
/s/ M. FAYE WILSON
--------------------------------------
M. Faye Wilson
<PAGE>
Exhibit 25.1
===============================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
---------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------------
THE HOME DEPOT, INC.
(Exact name of obligor as specified in its charter)
Delaware 95-3261426
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
2455 Paces Ferry Road
Atlanta, Georgia 30339
(Address of principal executive offices) (Zip code)
---------------------------
6-1/2% Senior Notes Due September 15, 2004
(Title of the indenture securities)
===============================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------- --------------------------------------------
Name Address
- ---------------------------------------------------------------- --------------------------------------------
<S> <C>
Superintendent of Banks of the State of New York 2 Rector Street, New York, N.Y. 10006,
and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
</TABLE>
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND
17 C.F.R.229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 21st day of October, 1999.
THE BANK OF NEW YORK
By /s/ Michael Culhane
-----------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
-3-
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1999,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
In Thousands
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin....................................... $5,597,807
Interest-bearing balances................................................................ 4,075,775
Securities:
Held-to-maturity securities ............................................................. 785,167
Available-for-sale securities............................................................ 4,159,891
Federal funds sold and Securities purchased under agreements to resell...................... 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned income................................................. 38,028,772
LESS: Allowance for loan and lease losses................................................ 568,617
LESS: Allocated transfer risk reserve.................................................... 16,352
Loans and leases, net of unearned income, allowance, and reserve......................... 37,443,803
Trading Assets.............................................................................. 1,563,671
Premises and fixed assets (including capitalized leases).................................... 683,587
Other real estate owned..................................................................... 10,995
Investments in unconsolidated subsidiaries and associated companies......................... 184,661
Customers' liability to this bank on acceptances outstanding................................ 812,015
Intangible assets........................................................................... 1,135,572
Other assets................................................................................ 5,607,019
-----------
Total assets................................................................................ $64,536,926
-----------
-----------
LIABILITIES
Deposits:
In domestic offices...................................................................... $26,488,980
Noninterest-bearing...................................................................... 10,626,811
Interest-bearing......................................................................... 15,862,169
In foreign offices, Edge and Agreement subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing...................................................................... 156,471
Interest-bearing......................................................................... 20,498,943
Federal funds purchased and Securities sold under agreements to repurchase.................. 3,729,439
Demand notes issued to the U.S.Treasury..................................................... 257,860
Trading liabilities......................................................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less.............................................. 496,235
With remaining maturity of more than one year through three years........................ 465
With remaining maturity of more than three years......................................... 31,080
Bank's liability on acceptances executed and outstanding.................................... 822,455
Subordinated notes and debentures........................................................... 1,308,000
Other liabilities........................................................................... 2,846,649
-----------
Total liabilities........................................................................... 58,624,027
-----------
-----------
EQUITY CAPITAL
Common stock................................................................................ 1,135,284
Surplus..................................................................................... 815,314
Undivided profits and capital reserves...................................................... 4,001,767
Net unrealized holding gains (losses) on available-for-sale securities...................... (7,956)
Cumulative foreign currency translation adjustments......................................... (31,510)
-----------
Total equity capital........................................................................ 5,912,899
-----------
Total liabilities and equity capital........................................................ $64,536,926
-----------
-----------
</TABLE>
I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Thomas J. Mastro
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Reyni
Alan R. Griffith Directors
Gerald L. Hassell
<PAGE>
EXHIBIT 99.1
LETTER OF TRANSMITTAL
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004 ("NEW NOTES")
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004 ("OLD NOTES")
PURSUANT TO THE PROSPECTUS DATED , 1999
- --------------------------------------------------------------------------------
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
, 1999 UNLESS THE EXCHANGE OFFER IS EXTENDED (THE "EXPIRATION
DATE"). TENDERS OF OLD NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE
EXPIRATION DATE.
- --------------------------------------------------------------------------------
DELIVERY TO:
THE BANK OF NEW YORK, EXCHANGE AGENT
<TABLE>
<S> <C>
BY REGISTERED OR CERTIFIED MAIL: BY HAND OR OVERNIGHT DELIVERY:
The Bank of New York The Bank of New York
101 Barclay Street, 7 101 Barclay Street
New York, New York 10286 Corporate Trust Services Window
Attention: Ground Level
Reorganization Section Attention:
Reorganization Section
BY FACSIMILE FOR ELIGIBLE INSTITUTIONS:
(212) 815-6339
CONFIRM BY TELEPHONE:
(212) 815-
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION VIA
TELEGRAM, TELEX OR FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE
A VALID DELIVERY.
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS
LETTER OF TRANSMITTAL IS COMPLETED.
<PAGE>
HOLDERS WHO WISH TO BE ELIGIBLE TO RECEIVE NEW NOTES FOR THEIR OLD NOTES
PURSUANT TO THE EXCHANGE OFFER MUST VALIDLY TENDER (AND NOT WITHDRAW) THEIR OLD
NOTES TO THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.
By execution hereof, the undersigned acknowledges receipt of the Prospectus
(the "Prospectus") dated , 1999, of The Home Depot, Inc., a Delaware
corporation (the "Company"), and this Letter of Transmittal and the instructions
hereto (the "Letter of Transmittal").
The Company reserves the right, at any time or from time to time, to extend
the Exchange Offer at its sole discretion, in which event the term "Expiration
Date" shall mean the latest time and date to which the Exchange Offer is
extended. The Company shall notify the holders of the Old Notes of any extension
by means of a press release or other public announcement prior to 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date.
This Letter of Transmittal 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
("DTC") 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 readily available so they can meet the Expiration Date
deadline, 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
DTC (a "Book-Entry Confirmation") and all other documents required by this
Letter of Transmittal 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 DTC does not constitute
delivery to the Exchange Agent.
The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer. Holders who wish to tender their Old Notes must complete
this letter in its entirety.
All capitalized terms used herein and not defined herein shall have the
meaning ascribed to them in the Prospectus.
HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER AND TENDER THEIR OLD NOTES
MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY.
2
<PAGE>
- --------------------------------------------------------------------------------
TENDER OF NOTES
- --------------------------------------------------------------------------------
/ / CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY DTC TO THE EXCHANGE
AGENT'S ACCOUNT AT DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Institution: _____________________________________________
DTC Book-Entry Account No.: ________________________________________________
Transaction Code No.: ______________________________________________________
If holders desire to tender Old Notes pursuant to the Exchange Offer and (i)
certificates representing such Old Notes are not lost but are not readily
available, (ii) time will not permit this Letter of Transmittal, certificates
representing such Old Notes or other required documents to reach the Exchange
Agent prior to the Expiration Date or (iii) the procedures for book-entry
transfer cannot be completed prior to the Expiration Date, such holders may
effect a tender of such Old Notes in accordance with the guaranteed delivery
procedures set forth in the Prospectus under "The Exchange Offer--Guaranteed
Delivery Procedures."
/ / CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY DELIVERED TO THE EXCHANGE AGENT AND
COMPLETE THE FOLLOWING:
Name(s) of Holder(s) of Old Notes: _________________________________________
Window Ticket No. (if any): ________________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Eligible Institution that Guaranteed Delivery: _____________________
If Delivered by Book-Entry Transfer: _______________________________________
Name of Tendering Institution: _____________________________________________
DTC Book-Entry Account No.: ________________________________________________
Transaction Code No.: ______________________________________________________
/ / CHECK HERE IF YOU ARE A BROKER-DEALER WHO HOLDS OLD NOTES ACQUIRED FOR YOUR
OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING ACTIVITIES AND
WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 ADDITIONAL
COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO FOR USE IN CONNECTION WITH
RESALES OF NEW NOTES RECEIVED FOR YOUR OWN ACCOUNT IN EXCHANGE FOR SUCH OLD
NOTES.
Name: ______________________________________________________________________
Address: ___________________________________________________________________
Aggregate Principal Amount of Old Notes so held: $ _________________________
- --------------------------------------------------------------------------------
3
<PAGE>
List below the Old Notes to which this Letter of Transmittal relates. If the
space provided below is inadequate, list the certificate numbers and principal
amounts on a separately executed schedule and affix the schedule to this Letter
of Transmittal. Tenders of Old Notes will be accepted only in principal amounts
equal to $1,000 or integral multiples thereof.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
DESCRIPTION OF NOTES
- ------------------------------------------------------------------------------------------------------
AGGREGATE
CERTIFICATE NUMBER(S)* PRINCIPAL
NAME(S) AND ADDRESS(ES) OF HOLDER(S) (ATTACH SIGNED AMOUNT TENDERED
(PLEASE FILL IN, IF BLANK) LIST IF NECESSARY) (IF LESS THAN ALL)**
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------
---------------------------------------------
---------------------------------------------
---------------------------------------------
---------------------------------------------
---------------------------------------------
---------------------------------------------
---------------------------------------------
TOTAL PRINCIPAL
AMOUNT OF OLD
NOTES TENDERED
- ------------------------------------------------------------------------------------------------------
* Need not be completed if by book-entry transfer.
** Need not be completed by holders who wish to tender with respect to all Old Notes listed.
See Instruction 2.
- ------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
LADIES AND GENTLEMEN:
The undersigned hereby tenders to The Home Depot, Inc., a Delaware
corporation (the "Company"), the aggregate principal amount of Old Notes
indicated in this Letter of Transmittal, upon the terms and subject to the
conditions set forth in the Company's Prospectus dated , 1999 (the
"Prospectus"), receipt of which is hereby acknowledged, and in this Letter of
Transmittal, which together constitute the Company's offer (the "Exchange
Offer") to exchange $1,000 principal amount of its 6 1/2% Senior Notes Due
September 15, 2004, which have been registered under the Securities Act of 1933,
as amended (the "New Notes"), for each $1,000 principal amount of its issued and
outstanding 6 1/2% Senior Notes Due September 15, 2004, of which $500,000,000
aggregate principal amount was outstanding on the date of the Prospectus (the
"Old Notes" and, together with the New Notes, the "Notes"). The capitalized
terms not defined herein are used herein as defined in the Prospectus.
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 and hereby irrevocably constitutes and appoints the
Exchange Agent as attorney-in-fact of the undersigned with respect to such Old
Notes, with full power of substitution (such power of attorney being an
irrevocable power coupled with an interest), to:
(a) deliver such Old Notes in registered certificated form, or transfer
ownership of such Old Notes through book-entry transfer at the Book-Entry
Transfer Facility, to or upon the order of the Company, upon receipt by the
Exchange Agent, as the undersigned's agent, of the same aggregate principal
amount of New Notes; and
(b) receive, for the account of the Company, all benefits and otherwise
exercise, for the account of the Company, all rights of beneficial ownership
of the Old Notes tendered hereby in accordance with the terms of the
Exchange Offer.
The undersigned hereby represents and warrants to the Company 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, marketable
and unencumbered title thereto, free and clear of all security interests, liens,
restrictions, charges, encumbrances, conditional sale agreements or other
obligations relating to their sale or transfer, and not subject to any adverse
claim when the same are accepted by the Company. The undersigned hereby further
represents that (i) any New Notes acquired in exchanged for Old Notes tendered
hereby are being acquired in the ordinary course of business of the person
receiving such New Notes, whether or not such person is the holder of such Old
Notes, (ii) neither the undersigned nor any such other person is engaging in or
intends to engage in a distribution of the New Notes, (iii) neither the
undersigned nor any such other person has an arrangement or understanding with
any person to participate in the distribution of such New Notes, and
(iv) neither the undersigned nor any such other person is an "affiliate" (as
defined in Rule 405 under the Securities Act of 1933, as amended (the
"Securities Act")) of the Company, or, if either is an affiliate, it will comply
with the registration and prospectus delivery requirements of the Securities
Act. If the undersigned is a broker-dealer that is to receive New Notes for its
own account in exchange for Old Notes (a "Participating Broker-Dealer"), it
further represents that such Old Notes were acquired as a result of
market-making activities or other trading activities, and 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, such Participating Broker-Dealer will not be deemed
to admit that it is an "underwriter" with respect to such New Notes within the
meaning of the Securities Act.
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 indicates that the New Notes issued in exchange for the Old Notes
pursuant to the Exchange Offer may be offered for resale, resold and otherwise
transferred by holders thereof (other than any such holder that is an
"affiliate" of the Company within the meaning of Rule 405 under the
5
<PAGE>
Securities Act) without compliance with the registration and prospectus delivery
provisions of the Securities Act, if such New Notes are acquired in the ordinary
course of such holders' business and such holders have no arrangement with any
person to participate in the 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
any holder of Old Notes is an affiliate of the Company or is engaged in, or
intends to engage in or has any arrangement or understanding with any person to
participate in, the distribution of the New Notes to be acquired pursuant to the
Exchange Offer, such holder (i) cannot rely on the applicable interpretations of
the staff of the SEC and (ii) must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction.
The Company has agreed that, subject to the provisions of the Registration
Rights Agreement, the Prospectus, as it may be amended or supplemented from time
to time, may be used by a Participating Broker-Dealer in connection with resales
of New Notes received in exchange for Old Notes which were acquired by such
Participating Broker-Dealer for its own account as a result of market-making or
other trading activities, for a period ending 135 days after the Expiration Date
or, earlier, when all such New Notes have been disposed of by such Participating
Broker-Dealer.
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 of Transmittal 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 of Tenders" section of the Prospectus.
Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, please deliver 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 DTC. Similarly,
unless otherwise indicated under the box entitled "Special Delivery
Instructions" below, 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 above in the box entitled "Description of Old
Notes."
THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD NOTES"
ABOVE AND SIGNING THIS LETTER OF TRANSMITTAL, WILL BE DEEMED TO HAVE TENDERED
THE OLD NOTES AS SET FORTH IN SUCH BOX ABOVE.
6
<PAGE>
- --------------------------------------------------------------------------------
IMPORTANT:
PLEASE SIGN HERE
(PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN)
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF
OLD NOTES REGARDLESS OF WHETHER OLD NOTES ARE
BEING PHYSICALLY DELIVERED HEREWITH)
If a holder is tendering any Old Notes, this Letter of Transmittal must be
signed by the holder(s) as the name(s) appear(s) on the certificate(s) for the
Old Notes or on a securities position listing or by any person(s) authorized
to become (a) 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.
X ____________________________________________________________________________
X ____________________________________________________________________________
SIGNATURE(S) OF OWNER(S)
Date: ___________________________
Date: ___________________________
Name(s): _____________________________________________________________________
______________________________________
(PLEASE PRINT)
Capacity: ____________________________________________________________________
Address: _____________________________________________________________________
______________________________________
(INCLUDING ZIP CODE)
Area Code and Telephone No.: _________________________________________________
Social Security No.: _________________________________________________________
SIGNATURE GUARANTEE (SEE INSTRUCTION 3 HEREIN)
CERTAIN SIGNATURES MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION
______________________________________________________________________________
(NAME OF ELIGIBLE INSTITUTION GUARANTEEING SIGNATURES)
______________________________________________________________________________
(ADDRESS (INCLUDING ZIP CODE) AND TELEPHONE NUMBER (INCLUDING AREA CODE) OF
FIRM)
______________________________________________________________________________
(AUTHORIZED SIGNATURE)
______________________________________________________________________________
(PRINTED NAME)
______________________________________________________________________________
(TITLE)
Date: ___________________________
- --------------------------------------------------------------------------------
7
<PAGE>
- -------------------------------------------
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 3 AND 4)
To be completed ONLY if certificates for Old Notes are not exchanged
and/or New Notes are to be issued in the name of and sent to someone other
than the person or persons whose signature(s) appear(s) above on this Letter
of Transmittal, or if Old Notes delivered by book-entry transfer which are
not accepted for exchange are to be returned by credit to an account
maintained at the Book-Entry Transfer Facility other than the account
indicated above.
Issue New Notes and/or Old Notes to:
Name(s): ___________________________________________________________________
(PLEASE TYPE OR PRINT)
__________________________________________________________________________
(PLEASE TYPE OR PRINT)
Address: ___________________________________________________________________
(PLEASE TYPE OR PRINT)
__________________________________________________________________________
(ZIP CODE)
Credit unexchanged Old Notes delivered by book-entry transfer to DTC account
set forth below.
____________________________________________________________________________
(DTC ACCOUNT NUMBER, IF APPLICABLE)
- ------------------------------------------------------
- ------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 3 AND 4)
To be completed ONLY if certificates for Old Notes are not exchanged
and/or New Notes are to be sent to someone other than the person or persons
whose signature(s) appear(s) above on this Letter of Transmittal or to such
person or persons at an address other than shown above in the box entitled
"Description of Old Notes" on this Letter of Transmittal.
Mail New Notes and/or Old Notes to:
Name(s): ___________________________________________________________________
(PLEASE TYPE OR PRINT)
__________________________________________________________________________
(PLEASE TYPE OR PRINT)
Address: ___________________________________________________________________
(PLEASE TYPE OR PRINT)
__________________________________________________________________________
(ZIP CODE)
- -----------------------------------------------------
8
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND NOTES; GUARANTEED DELIVERY
PROCEDURES. This Letter of Transmittal 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--Book-Entry Transfer" section of the Prospectus.
Certificates for all physically tendered Old Notes, or Book-Entry Confirmation
of tendered Old Notes, as the case may be, as well as a properly completed and
duly executed Letter of Transmittal (or manually signed facsimile hereof) and
any other documents required by this Letter of Transmittal, 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 may only be tendered in a principal amount
of $1,000 and any integral multiple thereof.
Holders of Old Notes 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) prior to the Expiration Date, the
Exchange Agent must receive from such Eligible Institution a properly completed
and duly executed 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 five New York Stock Exchange ("NYSE")
trading days after the Expiration Date, the certificates for all physically
tendered Old Notes, or a Book-Entry Confirmation of such Old Notes, and any
other documents required by this Letter of Transmittal will be deposited by the
Eligible Institution with the Exchange Agent, and (iii) a properly executed
Letter of Transmittal, as well as the certificates for all physically tendered
Old Notes in proper form for transfer or Book-Entry Confirmation of such Old
Notes, as the case may be, and all other documents required by this Letter of
Transmittal, must be received by the Exchange Agent within five NYSE trading
days after the Expiration Date.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, 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. INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT HOLDERS
USE AN OVERNIGHT OR HAND DELIVERY SERVICE, PROPERLY INSURED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT PRIOR
TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. DO NOT SEND THIS
LETTER OF TRANSMITTAL OR ANY OLD NOTES TO THE COMPANY.
See "The Exchange Offer" section of the Prospectus.
2. PARTIAL TENDERS (NOT APPLICABLE TO HOLDERS OF OLD NOTES WHO TENDER BY
BOOK-ENTRY TRANSFER); WITHDRAWAL RIGHTS. Tenders of Old Notes will be accepted
only in the principal amount of $1,000 and integral multiples thereof. 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 box above entitled "Description of Old
Notes--Aggregate 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 on this Letter of Transmittal,
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.
Except as otherwise provided herein, tenders of Old Notes may be withdrawn
at any time prior to the Expiration Date. In order for a withdrawal to be
effective prior to that time, a written or facsimile
9
<PAGE>
transmission notice of withdrawal must be timely received by the Exchange Agent
at one of its addresses set forth above prior to the Expiration Date. Any such
notice of withdrawal must specify the name of the person having deposited the
Old Notes to be withdrawn, the aggregate principal amount of Old Notes to be
withdrawn and (if certificates for such Old Notes have been tendered) the name
of the registered holder of the Old Notes as set forth on the certificate for
the Old Notes, if different from that of the person who tendered such Old Notes.
If certificates for the Old Notes have been delivered or otherwise identified to
the Exchange Agent, then prior to the physical release of such certificates for
the Old Notes, the tendering holder must submit the serial numbers shown on the
particular certificates for the Old Notes to be withdrawn and the signature on
the notice of withdrawal must be guaranteed by an Eligible Institution, except
in the case of Old Notes tendered for the account of an Eligible Institution. If
Old Notes have been tendered pursuant to the procedures for book-entry transfer
set forth in "The Exchange Offer--Book-Entry Transfer" section of the
Prospectus, the notice of withdrawal must specify the name and number of the
account at DTC to be credited with the withdrawal of Old Notes, in which case a
notice of withdrawal will be effective if delivered to the Exchange Agent by
written or facsimile transmission. Withdrawals of tenders of Old Notes may not
be rescinded. Old Notes properly withdrawn will not be deemed to have been
validly tendered for purposes of the Exchange Offer, and no New Notes will be
issued with respect thereto unless the Old Notes so withdrawn are validly
retendered. Properly withdrawn Old Notes may be retendered at any subsequent
time on or prior to the Expiration Date by following the procedures described in
the Prospectus under "The Exchange Offer--Procedures for Tendering."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Company, in its
sole discretion, whose determination shall be final and binding on all parties.
Neither the Company, any employees, agents, affiliates or assigns of the
Company, the Exchange Agent nor any other person shall be under any duty to give
any notification of any irregularities in any notice of withdrawal or incur any
liability for failure to give such notification. Any Old Notes which have been
tendered but which are withdrawn will be returned to the holder thereof without
cost to such holder as promptly as practicable after withdrawal.
3. SIGNATURES ON THIS LETTER OF TRANSMITTAL; BOND POWERS AND ENDORSEMENTS;
GUARANTEE OF SIGNATURES. If this Letter of Transmittal 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 or on a securities position
listing 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 of Transmittal.
If any tendered Old Notes are registered in different names on several
certificates or securities positions listings, it will be necessary to complete,
sign and submit as many separate copies of this Letter of Transmittal as there
are different registrations.
When this Letter of Transmittal 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 nontendered 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.
In connection with any tender of Old Notes in definitive certificated form,
if this Letter of Transmittal is signed by a person other than the registered
holder or holders of any certificate(s) specified herein, such certificate(s)
must be endorsed or accompanied by appropriate bond powers, in either case
signed exactly as the name or names of the registered holder or holders
appear(s) on the certificate(s), and the signatures on such certificate(s) must
be guaranteed by an Eligible Institution.
If this Letter of Transmittal 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
10
<PAGE>
representative capacity, such persons should so indicate when signing, and,
unless waived by the Company, 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 FIRM WHICH IS A MEMBER OF
A REGISTERED NATIONAL SECURITIES EXCHANGE OR A MEMBER OF THE NATIONAL
ASSOCIATION OF SECURITIES DEALERS, INC. OR BY A COMMERCIAL BANK OR TRUST COMPANY
HAVING AN OFFICE OR CORRESPONDENT IN THE UNITED STATES (AN "ELIGIBLE
INSTITUTION").
SIGNATURES ON THIS LETTER OF TRANSMITTAL NEED NOT BE GUARANTEED BY AN
ELIGIBLE INSTITUTION, PROVIDED THE OLD NOTES ARE TENDERED: (I) BY A 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 of Transmittal. In the
case of issuance in a different name, the Employer Identification or Social
Security Number of the person named must also be indicated. A holder of Old
Notes tendering Old Notes by book-entry transfer may request that Old Notes not
exchanged be credited to such account maintained at DTC as such holder may
designate hereon. If no such instructions are given, such Old Notes not
exchanged will be returned to the name or address of the person signing this
Letter of Transmittal or credited to the account listed beneath the box entitled
"Description of Old Notes," as the case may be.
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 of Transmittal, 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
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 directly to
such tendering holder.
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 OF
TRANSMITTAL.
6. DETERMINATION OF VALIDITY. The Company will determine, in its sole
discretion, all questions as to the form of documents, validity, eligibility
(including time of receipt) and acceptance for exchange of any tender of Old
Notes, which determination shall be final and binding on all parties. The
Company reserves the absolute right to reject any and all tenders determined by
it not to be in proper form or the acceptance of which, or exchange for which,
may, in the view of counsel to the Company, be unlawful. The Company also
reserves the absolute right, subject to applicable law, to waive any of the
conditions of the Exchange Offer set forth in the Prospectus under the caption
"The Exchange Offer" or any conditions or irregularity in any tender of Old
Notes of any particular holder whether or not similar conditions or
irregularities are waived in the case of other holders.
11
<PAGE>
The Company's interpretation of the terms and conditions of the Exchange
Offer (including this Letter of Transmittal and the instructions hereto) will be
final and binding. No tender of Old Notes will be deemed to have been validly
made until all irregularities with respect to such tender have been cured or
waived. Although the Company intends to notify holders of defects or
irregularities with respect to tenders of Old Notes, neither the Company, any
employees, agents, affiliates or assigns of the Company, the Exchange Agent, nor
any other person shall be under any duty to give notification of any
irregularities in tenders or incur any liability for failure to give such
notification.
7. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under the U.S. Federal
income tax law, a holder of Old Notes whose tendered Old Notes are accepted for
exchange is required to provide the Exchange Agent with such holder's correct
taxpayer identification number ("TIN") on Substitute Form W-9 below. If the
Exchange Agent is not provided with the correct TIN, the Internal Revenue
Service (the "IRS") may subject the holder or other payee to a $50 penalty. In
addition, payments to such holders or other payees with respect to Old Notes
exchanged pursuant to the Exchange Offer may be subject to 31% backup
withholding.
The box in Part 2 of the Substitute Form W-9 may be checked if the tendering
holder has not been issued a TIN and has applied for a TIN or intends to apply
for a TIN in the near future. If the box in Part 2 is checked, the holder or
other payee must also complete the Certificate of Awaiting Taxpayer
Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 2 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Exchange Agent will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Exchange Agent. The Exchange Agent will retain such amounts
withheld during the 60-day period following the date of the Substitution
Form W-9. If the holder furnishes the Exchange Agent with its TIN within
60 days after the date of the Substitute Form W-9, the amounts retained during
the 60-day period will be remitted to the holder and no further amounts shall be
retained or withheld from payments made to the holder thereafter. If, however,
the holder has not provided the Exchange Agent with its TIN within such 60-day
period, amounts withheld will be remitted to the IRS as backup withholding. In
addition, 31% of all payments made thereafter will be withheld and remitted to
the IRS until a correct TIN is provided.
The holder is required to give the Exchange Agent the TIN (e.g., social
security number or employer identification number) of the registered owner of
the Old Notes or of the last transferee appearing on the transfers attached to,
or endorsed on, the Old Notes. If the Old Notes are registered in more than one
name or are not 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 on which number to report.
Certain holders (including, among others, corporations, financial
institutions and certain foreign persons) may not be subject to the backup
withholding and reporting requirements. Such holders should nevertheless
complete the attached Substitute Form W-9 below, and write "exempt" on the face
thereof, to avoid possible erroneous backup withholding. A foreign person may
qualify as an exempt recipient by submitting a properly completed IRS Form W-8,
signed under penalties of perjury, attesting to that holder's exempt status.
Please consult the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional guidance on which
holders are exempt from backup withholding.
Backup withholding is not an additional U.S. Federal income tax. Rather, the
U.S. Federal income tax liability of a person 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.
8. WAIVER OF CONDITIONS. The Company reserves the absolute right to waive
any of the conditions in the Exchange Offer in the case of any tendered Old
Notes.
12
<PAGE>
9. NO CONDITIONAL TENDERS. No alternative, conditional, irregular or
contingent tenders will be accepted. All tendering holders of Old Notes, by
execution of this Letter of Transmittal, hereby waive any right to receive
notice of the acceptance of their Old Notes for exchange.
10. 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.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions relating to the
procedure for tendering, as well as requests for additional copies of the
Prospectus and this Letter of Transmittal, may be directed to the Exchange
Agent, at the address and telephone number indicated above.
13
<PAGE>
PAYER'S NAME: THE BANK OF NEW YORK
<TABLE>
<C> <S> <C>
- ---------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1--PLEASE PROVIDE
FORM W-9 YOUR TIN IN THE BOX AT TIN:
DEPARTMENT OF THE TREASURY RIGHT AND CERTIFY BY Social Security Number or Employer
INTERNAL REVENUE SERVICE SIGNING AND DATING BELOW. Identification Number
------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER PART 2--TIN Applied For / /
IDENTIFICATION NUMBER ("TIN")
- ---------------------------------------------------------------------------------------------------------------
CERTIFICATION: Under penalties of perjury, I certify that:
(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); and
(2) I am not subject to backup withholding either because: (a) I have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup withholding as a result of a failure to report all interests
or dividends, or (b) the IRS has notified me that I am no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS--You must cross out item (2) above 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. However,
if after being notified by the IRS that you were subject to backup withholding, you received another
notification from the IRS that you were no longer subject to backup withholding, do not cross out item (2).
(Also see instructions in the enclosed GUIDELINES).
- ---------------------------------------------------------------------------------------------------------------
Signature
-------------------------------------------------------------------------------------------------------------- Date
----------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU IN CONNECTION WITH THE EXCHANGE
OFFER. 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 ARE AWAITING (OR WILL SOON
APPLY FOR) A TAXPAYER IDENTIFICATION NUMBER CERTIFICATE OF AWAITING TAXPAYER
IDENTIFICATION NUMBER
------------------------------------------------------------------------------
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 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, thirty-one (31%) percent of all reportable payments made
to me thereafter will be withheld until I provide a number.
Signature _______________________________ Date _______________________________
- --------------------------------------------------------------------------------
14
<PAGE>
EXHIBIT 99.2
NOTICE OF GUARANTEED DELIVERY
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
This form or one substantially equivalent hereto must be used to accept the
offer to exchange (the "Exchange Offer") of The Home Depot, Inc., a Delaware
corporation (the "Company"), made pursuant to the Prospectus, dated
, 1999 (the "Prospectus"), if certificates for the outstanding
6 1/2% Senior Notes Due September 15, 2004 of the Company (the "Old Notes") are
not readily available or if the procedure for book-entry transfer cannot be
completed on a timely basis or time will not permit all required documents to
reach The Bank of New York, as Trustee (the "Exchange Agent") on or prior to
5:00 p.m., New York City time, on the Expiration Date (as defined below) of the
Exchange Offer. This Notice of Guaranteed Delivery may be delivered or
transmitted by telegram, telex, facsimile transmission, mail or hand delivery to
the Exchange Agent as set forth below. See "The Exchange Offer--Procedures for
Tendering" in the Prospectus. Capitalized terms used herein but not defined
herein have the respective meanings given to them in the Prospectus.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
, 1999 UNLESS THE EXCHANGE OFFER IS EXTENDED (THE "EXPIRATION
DATE"). TENDERS OF OLD NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO THE
EXPIRATION DATE.
<TABLE>
<S> <C>
EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE BANK OF NEW YORK
BY REGISTERED OR CERTIFIED MAIL: FACSIMILE TRANSMISSION:
The Bank of New York (Eligible Institutions Only)
101 Barclay Street, 7E (212) 815-6339
New York, New York 10286
Attention:
BY HAND OR OVERNIGHT DELIVERY: TO CONFIRM BY TELEPHONE:
The Bank of New York (212) 815-
101 Barclay Street
Corporate Trust Services Window
Ground Level
New York, New York 10286
Attention:
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION VIA TELEGRAM,
TELEX OR FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY.
This form is not to be used to guarantee signatures. If a signature on the
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>
LADIES AND GENTLEMEN:
The undersigned hereby tender(s) to the Company, upon the terms and subject
to the conditions set forth in the Prospectus and the related Letter of
Transmittal, 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.
All authority herein conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death or incapacity of the undersigned and
every obligation of the undersigned under this Notice of Guaranteed Delivery
shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s) or
Authorized Signatory: ________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Principal Amount of Old Notes Tendered:*
______________________________________________________________________________
Certificate No(s). of Old Notes (if available):
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Date: ________________________________________________________________________
- --------------------------------------------------------------------------------
Name(s) of Holder(s): ________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Address: _____________________________________________________________________
______________________________________________________________________________
Area Code and Telephone No.: _________________________________________________
2
<PAGE>
______________________________________________________________________________
If Old Notes will be delivered by book-entry transfer at The Depository Trust
Company, insert Depository Account No.:
______________________________________________________________________________
- --------------------------------------------------------------------------------
* Must be in denominations of principal amount of $1,000.00 and any integral
multiple thereof.
3
<PAGE>
- --------------------------------------------------------------------------------
PLEASE SIGN AND COMPLETE
This Notice of Guaranteed Delivery must be signed by the holder(s) of Old
Notes exactly as its (their) name(s) appear on certificates for Old Notes or
on a security position listing as the owner of Old Notes, or by person(s)
authorized to become holder(s) by endorsements and documents transmitted with
this Notice of Guaranteed Delivery. If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer or other person acting in a
fiduciary or representative capacity, such person must provide the following
information.
PLEASE PRINT NAME(S) AND ADDRESS(ES)
Name(s) ______________________________________________________________________
______________________________________________________________________________
Capacity: ____________________________________________________________________
Address(es): _________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Do not send Old Notes with this form. Notes should be sent to the Exchange
Agent together with a properly completed and duly executed Letter of
Transmittal.
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
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, 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 (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
New York Stock Exchange trading days after the date of execution of this Notice
of Guaranteed Delivery.
The undersigned acknowledges that it must deliver the Letter of Transmittal
(or facsimile thereof) and Old Notes tendered hereby to the Exchange Agent
within the time period set forth above and that failure to do so could result in
financial loss to the undersigned.
- --------------------------------------------------------------------------------
Name of Firm: __________________________________________________________________
Address: _______________________________________________________________________
________________________________________________________________________________
(Zip Code)
Area Code and Telephone No. ____________________________________________________
________________________________________________________________________________
(Authorized Signature)
________________________________________________________________________________
Name: __________________________________________________________________________
(Please Print)
Title: _________________________________________________________________________
Date: __________________________________________________________________________
- -------------------------------------------
NOTE: DO NOT SEND CERTIFICATES FOR OLD NOTES WITH THIS FORM. CERTIFICATES FOR
OLD NOTES SHOULD ONLY BE SENT WITH YOUR LETTER OF TRANSMITTAL
4
<PAGE>
EXHIBIT 99.3
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER.--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e. 00-0000000. The table below will help determine the number to
give the payer.
- -----------------------------------------------------------------------------
GIVE THE
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT NUMBER OF--
- -----------------------------------------------------------------------------
1. An individual's account. The individual
2. Two or more individuals (joint The actual owner of the account or,
account) if combined funds, any one of the
individuals (1)
3. Husband and wife (joint account) The actual owner of the account or,
if joint funds, either person (1)
4. Custodian account of a minor The minor (2)
(Uniform Gift to Minors Act)
5. Adult and minor (joint account) The adult or, if the minor is the
only contributor, the minor (1)
6. Account in the name of guardian or The ward, minor or incompetent
committee for a designated ward, person (3)
minor, or incompetent person
7. a. The usual revocable savings The grantor-trustee (1)
trust account (grantor is also
trustee)
b. So-called trust account that is
not a legal or valid trust under
State law
8. Sole proprietorship account The owner (4)
- -----------------------------------------------------------------------------
GIVE THE EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT NUMBER OF--
- -----------------------------------------------------------------------------
9. A valid trust, estate, or pension The legal entity (Do not furnish
trust the identifying number of the
personal representative or trustee
unless the legal entity itself is
not designated in the account
title) (5)
10. Corporate account The corporation
11. Religious, charitable, or The organization
educational organization account
12. Partnership account held in the The partnership
name of the business
13. Association, club, or other The organization
tax-exempt organization
14. A broker or registered nominee The broker or nominee
15. Account with the Department of The public entity
Agriculture in the name of a public
entity (such as a State or local
government, school district, or
prison) that receives agricultural
program payments
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
Note: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
- A corporation.
- A financial institution.
- An organization exempt from tax under section 501(a), or an individual
retirement.
- The United States or any agency or instrumentality thereof.
- A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
- An international organization or any agency, or instrumentality thereof.
- A registered dealer in securities or commodities registered in the U.S. or
a possession of the U.S.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a).
- An exempt charitable remainder trust, or a non-exempt trust described in
Section 4947(a)(1).
- An entity registered at all times under the Investment Company Act of
1940.
- A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- Payments to nonresident aliens subject to withholding under Section 1441.
- Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident partner.
- Payments of patronage dividends where the amount received is not paid in
money.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals. NOTE: You may
be subject to backup withholding if this interest is $600 or more, and is
paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
Section 852).
- Payments described in Section 6049(b)(5) to non-resident aliens.
- Payments on tax-free covenant bonds under Section 1451.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
EXEMPT PAYEES DESCRIBED ABOVE SHOULD FILE FORM W-9 TO AVOID POSSIBLE ERRONEOUS
BACKUP WITHHOLDING. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under Sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividends,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. The IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Beginning January 1, 1993, payers must generally
withhold 31% of taxable interest, dividends, and certain other payments to a
payee who does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your correct taxpayer identification number to a payer, you are
subject to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE STATEMENTS WITH RESPECT TO WITHHOLDING.--If you make
a false statement with no reasonable basis which results in no imposition of
backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--If you falsify certifications
or affirmations, you are subject to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE.
<PAGE>
EXHIBIT 99.4
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON, ,
1999, UNLESS EXTENDED OR TERMINATED (THE "EXPIRATION DATE").
To Our Clients:
Enclosed for your consideration is a Prospectus dated , 1999 (as the
same may be amended or supplemented from time to time, the "Prospectus") and a
form of Letter of Transmittal (the "Letter of Transmittal") relating to the
offer (the "Exchange Offer") by The Home Depot, Inc. (the "Company") to exchange
$500,000,000 in aggregate principal amount of its 6 1/2% Senior Notes Due
September 15, 2004 which have been registered under the Securities Act of 1934
(the "New Notes") for $500,000,000 in aggregate principal amount of its
outstanding unregistered 6 1/2% Senior Notes Due September 15, 2004 (the "Old
Notes") upon the terms and conditions set forth in the Prospectus and the Letter
of Transmittal.
The material is being forwarded to you as the beneficial owner of Old Notes
held by us for your account or benefit but not registered in your name. A tender
of the Old Notes pursuant to the Exchange Offer may be made only by us as the
registered holder of the Old Notes, and pursuant to your instructions.
Therefore, the Company urges beneficial owners of Old Notes registered in the
name of a broker, dealer, commercial bank, trust company or other nominee to
contact such holder promptly if they wish to tender Old Notes in the Exchange
Offer.
Accordingly, we request instructions as to whether you wish us to tender any
or all Old Notes held by us for your account or benefit, pursuant to the terms
and conditions set forth in the Prospectus and Letter of Transmittal. We urge
you to read carefully the Prospectus and Letter of Transmittal before
instructing us to tender your Old Notes pursuant to the Exchange Offer.
Your instructions to us should be forwarded as promptly as practicable in
order to permit us to tender Old Notes on your behalf in accordance with the
provisions of the Exchange Offer. The Exchange Offer will expire at 5:00 p.m.,
New York City Time, on , 1999, unless extended (the "Expiration Date").
Old Notes tendered pursuant to the Exchange Offer may be withdrawn, subject to
the procedures described in the Prospectus, at any time prior to the Expiration
Date.
If you wish to have us tender any or all of your Old Notes held by us for
your account or benefit, please so instruct us by completing, executing and
returning to us the instruction form that appears below. The accompanying Letter
of Transmittal is furnished to you for informational purposes only and may not
be used by you to tender Old Notes held by us and registered in our name for
your account or benefit.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE EXCHANGE OFFER
The undersigned acknowledge(s) receipt of your letter and the enclosed
material referred to therein relating to the Exchange Offer made by The Home
Depot, Inc. with respect to their Old Notes.
This will instruct you to tender the Old Notes held by you for the account
of the undersigned, upon and subject to the terms and conditions set forth in
the Prospectus and the related Letter of Transmittal.
Please tender the Old Notes held by you for my account as indicated below:
AGGREGATE PRINCIPAL AMOUNT OF OLD
NOTES
$ __________________________________
/ / Please DO NOT tender any Old
Notes held by you for my account
Dated: ______________________, 1999.
____________________________________
____________________________________
Signature(s)
____________________________________
____________________________________
Please Print Name(s) here
____________________________________
____________________________________
Address(es)
____________________________________
Area Code(s) and Telephone Number(s)
____________________________________
Tax Identification or Social
Security No(s)
None of the Old Notes held by us for your account will be tendered unless we
receive written instructions from you to do so. Unless a specific instruction is
given in the space provided, your signature(s) hereon shall constitute an
instruction to us to tender all the Old Notes held by us for your account.
<PAGE>
EXHIBIT 99.5
THE HOME DEPOT, INC.
OFFER TO EXCHANGE
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ALL OUTSTANDING UNREGISTERED
6 1/2% SENIOR NOTES DUE SEPTEMBER 15, 2004
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME, ON , 1999,
UNLESS EXTENDED OR TERMINATED (THE "EXPIRATION DATE").
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Enclosed for your consideration is a Prospectus dated , 1999 (as
the same may be amended or supplemented from time to time, the "Prospectus") and
a form of Letter of Transmittal (the "Letter of Transmittal") relating to the
offer (the "Exchange Offer") by The Home Depot, Inc. (the "Company") to exchange
$500,000,000 in aggregate principal amount of its 6 1/2% Senior Notes Due
September 15, 2004 which have been registered under the Securities Act of 1933
(the "New Notes") for $500,000,000 in aggregate principal amount of its
outstanding unregistered 6 1/2% Senior Notes Due September 15, 2004 (the "Old
Notes").
We are asking you to contact your clients for whom you hold Old Notes
registered in your name or in the name of your nominee. In addition, we ask you
to contact your clients who, to your knowledge, hold Old Notes registered in
their own name. The Company will not pay any fees or commissions to any broker,
dealer or other person in connection with the solicitation of tenders pursuant
to the Exchange Offer. You will, however, be reimbursed by the Company for
customary mailing and handling expenses incurred by you in forwarding any of the
enclosed materials to your clients. The Company will pay all transfer taxes, if
any, applicable to the tender of Old Notes to it or its order, except as
otherwise provided in the Prospectus and the Letter of Transmittal.
Enclosed are copies of the following documents:
1. The Prospectus;
2. A Letter of Transmittal for your use in connection with the tender of
Old Notes and for the information of your clients;
3. A form of letter that may be sent to your clients for whose accounts
you hold Old Notes registered in your name or the name of your nominee, with
space provided for obtaining the clients' instructions with regard to the
Exchange Offer;
4. A form of Notice of Guaranteed Delivery; and
5. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
Your prompt action is requested. the Exchange Offer will expire at
5:00 p.m., New York City Time, on , 1999, unless extended (the
"Expiration Date"). Old Notes tendered pursuant to the Exchange Offer may be
withdrawn, subject to the procedures described in the Prospectus, at any time
prior to the Expiration Date.
In all cases, exchanges of Old Notes for New Notes accepted for exchange
pursuant to the Exchange Offer will be made only after timely receipt by the
Exchange Agent of (a) certificates representing such Old Notes or a confirmation
of a book-entry transfer of such Old Notes, as the case may be, (b) the Letter
of Transmittal (or a facsimile thereof) promptly completed and duly executed
with any required signature guarantees, and (c) any other documents required by
the Letter of Transmittal.
<PAGE>
Holders who wish to tender their Old Notes and (a) whose Old Notes are not
immediately available, (b) who cannot deliver their Old Notes, the Letter of
Transmittal or any other required documents to the Exchange Agent prior to the
Expiration Date or (c) who cannot complete the procedure for book-entry transfer
on a timely basis, may tender their Old Notes by following the guaranteed
delivery procedures described in the Prospectus under "The Exchange
Offer--Guaranteed Delivery Procedures."
To tender Old Notes, certificates for Old Notes, a duly executed and
properly completed Letter of Transmittal or a facsimile thereof, together with
any other required documents, must be received by the Exchange Agent as provided
in the Prospectus and the Letter of Transmittal.
Additional copies of the enclosed material may be obtained from the Exchange
Agent, The Bank of New York, by calling (212) .
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY
PERSON AS AN AGENT OF THE COMPANY OR THE EXCHANGE AGENT, OR AUTHORIZE YOU OR ANY
OTHER PERSON TO MAKE ANY STATEMENTS ON BEHALF OF EITHER OF THEM WITH RESPECT TO
THE EXCHANGE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS AND
THE LETTER OF TRANSMITTAL.
