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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: February 11, 2000
THE KROGER CO.
(Exact name of registrant as specified in its charter)
An Ohio Corporation No. 1-303 31-0345740
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Number)
1014 Vine Street
Cincinnati, OH 45201
(Address of principal
executive offices)
Registrant's telephone number: (513) 762-4000
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Item 5. Other Events
On February 2, 2000, The Kroger Co., and its
subsidiary guarantors, filed Registration Statement
No. 333-95955 on Form S-3 with the Securities and
Exchange Commission pursuant to Rule 415,
(hereinafter referred to as the "Registration
Statement"). The Registration Statement provides for
the issuance of Securities in an aggregate amount of
$1,725,000,000, and was declared effective on
February 2, 2000. Pursuant to a Prospectus Supplement
dated February 4, 2000, The Kroger Co. is issuing
$500,000,000 of Debt Securities denominated 8.05%
Senior Notes due 2010. The Debt Securities being
issued are being guaranteed by the subsidiary
guarantors.
Filed as Exhibit 1.1 to the Registration Statement
was a form of Underwriting Agreement for the issuance
of the Debt Securities. Attached hereto as Exhibit
1.1 is the Underwriting Agreement dated February 4,
2000. In connection with the issuance of the Senior
Notes, the Registrant has executed a Pricing
Agreement dated February 4, 2000, among The Kroger
Co., its subsidiary guarantors, Goldman, Sachs & Co.,
Chase Securities Inc., Banc One Capital Markets,
Inc., Banc of America Securities LLC, and U.S.
Bancorp Piper Jaffray Inc., the form of which is
incorporated herein by reference as Exhibit 1.1.1
hereof.
The form of indenture for the Senior Notes was filed
as Exhibit 4.3 of the Registration Statement. The
Seventh Supplemental Indenture, dated as of February
11, 2000, among The Kroger Co., its subsidiary
guarantors, and Firstar Bank, National Association,
as Trustee, supplements the Indenture dated as of
June 25, 1999, among The Kroger Co., its subsidiary
guarantors, and Firstar Bank, National Association,
as Trustee. The Seventh Supplemental Indenture is
attached hereto as Exhibit 4.3.1.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits:
1.1 Underwriting Agreement dated February 4,
2000, among The Kroger Co., its subsidiary
guarantors, Goldman, Sachs & Co., Chase
Securities Inc., Banc One Capital Markets,
Inc., Banc of America Securities LLC, and
U.S. Bancorp Piper Jaffray Inc.
1.1.1 Pricing Agreement dated February 4,
2000, among The Kroger Co., its subsidiary
guarantors, Goldman, Sachs & Co.,
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Chase Securities Inc., Banc One Capital
Markets, Inc., Banc of America Securities
LLC, and U.S. Bancorp Piper Jaffray Inc.
4.3.1 Seventh Supplemental Indenture dated
as of February 11, 2000, among The Kroger
Co., its subsidiary guarantors, and Firstar
Bank, National Association, as trustee,
relating to the 8.05% Senior Notes due 2010.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
THE KROGER CO.
February 11, 2000 By: (Paul Heldman)
Paul Heldman
Senior Vice President, Secretary
and General Counsel
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EXHIBIT INDEX
Exhibit No. Exhibit
- ----------- -------
1.1 Underwriting Agreement dated February 4,
2000, among The Kroger Co., its subsidiary
guarantors, Goldman, Sachs & Co., Chase
Securities Inc., Banc One Capital Markets,
Inc., Banc of America Securities LLC, and
U.S. Bancorp Piper Jaffray Inc.
1.1.1 Pricing Agreement dated February 4, 2000,
among The Kroger Co., its subsidiary
guarantors, Goldman, Sachs & Co., Chase
Securities Inc., Banc One Capital Markets,
Inc., Banc of America Securities LLC, and
U.S. Bancorp Piper Jaffray Inc.
4.3.1 Seventh Supplemental Indenture dated as of
February 11, 2000, among The Kroger Co., its
subsidiary guarantors, and Firstar Bank,
National Association, as trustee, relating
to the 8.05% Senior Notes due 2010.
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Exhibit 1.1
The Kroger Co.
Debt Securities
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Underwriting Agreement
To the Representatives of the February 4, 2000
several Underwriters named in the
respective Pricing Agreements
hereinafter described.
Dear Sirs:
From time to time The Kroger Co., an Ohio corporation (the "Company"),
and the Guarantors on Schedule I and on the signature pages hereto, propose to
enter into one or more Pricing Agreements (each a "Pricing Agreement") in the
form of Annex I hereto, with such additions and deletions as the parties thereto
may determine, and, subject to the terms and conditions stated herein and
therein, to issue and sell to the firms named in Schedule I to the applicable
Pricing Agreement (such firms constituting the "Underwriters" with respect to
such Pricing Agreement and the securities specified therein) certain of its debt
securities (the "Securities") specified in Schedule II to such Pricing Agreement
(with respect to such Pricing Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto and
in or pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being designated
as their representative. This Underwriting Agreement shall not be construed as
an obligation of the Company to sell any of the Securities or as an obligation
of any of the Underwriters to purchase the Securities. The obligation of the
Company to issue and sell any of the Securities and the obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced by the Pricing
Agreement with respect to the Designated Securities specified therein. Each
Pricing Agreement shall specify the aggregate principal amount of such
Designated Securities, the initial public offering price of such Designated
Securities, the purchase price to the Underwriters of such Designated
Securities, the names of the Underwriters of such Designated Securities, the
names of the Representatives of such Underwriters and the principal amount of
such Designated Securities to be purchased by each Underwriter and shall set
forth the date, time and manner of delivery to such Designated Securities and
payment therefor. The Pricing Agreement shall also specify (to the extent not
set forth in the Indenture and the registration statement and prospectus with
respect thereto) the terms of such Designated Securities. A Pricing Agreement
shall be in the form of an executed writing (which may be in counterparts),
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and may be evidenced by an exchange of telegraphic communications or any other
rapid transmission device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement in respect of the Securities has
been filed with the Securities and Exchange Commission (the
"Commission"); such registration statement and any post-effective
amendment thereto, each in the form heretofore delivered or to be
delivered to the Representatives and, excluding exhibits to such
registration statement, but including all documents incorporated by
reference in the prospectus contained therein, to the Representatives
for each of the other Underwriters, have been declared effective by the
Commission in such form; no other document with respect to such
registration statement or document incorporated by reference therein
has heretofore been filed or transmitted for filing with the
Commission; and no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statement or filed
with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), being hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto and the documents incorporated by
reference in the prospectus contained in the registration statement at
the time such part of the registration statement became effective but
excluding Form T-1, each as amended at the time such part of the
registration statement became effective, being hereinafter called the
"Registration Statement"; the prospectus relating to the Securities, in
the form in which it has most recently been filed, or transmitted for
filing, with the Commission on or prior to the date of this Agreement,
being hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to
the applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the
date of such Preliminary Prospectus or Prospectus, as the case may be,
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any
annual report of the Company filed pursuant to Section 13(a) or 15(d)
of the Exchange Act after the effective date of the Registration
Statement that is incorporated by reference in the Registration
Statement; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Securities in the
form in which it is filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof, including any
documents incorporated by reference therein as of the date of such
filing);
(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be,
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conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or any further amendment or
supplement thereto, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter of Designated
Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act") and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, 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;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Securities;
(d) The Company and its subsidiaries have not sustained since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with their businesses, taken as a whole, from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material change in the capital stock or long-term debt of the
Company and its subsidiaries on a consolidated basis or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole, otherwise than as
set forth or contemplated in the Prospectus;
(e) The Company and its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title
to all personal property owned by them, in each case free and clear of
all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such
property and do not interfere with the use made and proposed to
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be made of such property by the Company and its subsidiaries; and any
real property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries;
(f) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Ohio, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, or is subject to no
material liability or disability by reason of the failure to be
qualified in any such jurisdiction; and each subsidiary of the Company
has been duly incorporated and is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation;
(g) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable; and all of the issued shares of capital stock
of each subsidiary of the Company have been duly and validly authorized
and issued, are fully paid and non-assessable and (except for
directors' qualifying shares) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims;
(h) The Securities have been duly authorized, and, when
Designated Securities are issued and delivered pursuant to this
Agreement and the Pricing Agreement with respect to such Designated
Securities against payment of the consideration specified in the
Pricing Agreement, such Designated Securities will have been duly
executed, authenticated, issued and delivered and will constitute valid
and legally binding obligations of the Company, enforceable in
accordance with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles and will be entitled to the benefits provided by the
Indenture under which they are to be issued which will be substantially
in the form filed as an exhibit to the Registration Statement; the
Indenture has been duly authorized and duly qualified under the Trust
Indenture Act and, at the Time of Delivery for such Designated
Securities (as defined in Section 4 hereof), the Indenture will
constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity
principles; and the Indenture conforms, and the Designated Securities
will conform, in all material respects, to the descriptions thereof
contained in the Prospectus as amended or supplemented with respect to
such Designated Securities;
(i) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the
Indenture, this Agreement and any Pricing Agreement, and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Company or any of
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its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action
result in any violation of the provisions of the Articles of
Incorporation, as amended, or the Regulations of the Company or any
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale
of the Securities or the consummation by the Company of the other
transactions contemplated by this Agreement or any Pricing Agreement or
the Indenture, except such as have been, or will have been prior to the
Time of Delivery, obtained under the Act and the Trust Indenture Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Securities
by the Underwriters;
(j) Other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any property
of the Company or any of its subsidiaries is the subject with respect
to which there is a reasonable likelihood of a determination which
would individually or in the aggregate have a material adverse effect
on the consolidated financial position, stockholders' equity or results
of operations of the Company and its subsidiaries; and, to the best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(k) None of the transactions contemplated by this Agreement,
any Pricing Agreement or the Indenture (including, without limitation,
the use of the proceeds from the sale of the Securities) will violate
or result in a violation of Section 7 of the Exchange Act, or any
regulation promulgated thereunder, including, without limitation,
Regulations G, T, U and X of the Board of Governors of the Federal
Reserve System;
(l) The Company is not subject to regulation under the
Investment Company Act of 1940, as amended;
(m) The Company will apply the net proceeds from the sale of
Securities for the purpose set forth in the Prospectus under the
caption "Use of Proceeds"; and
(n) PricewaterhouseCoopers L.L.P. and Deloitte & Touche LLP,
respectively, who have audited certain financial statements of the
Company and its subsidiaries and Fred Meyer, Inc. and its subsidiaries
(collectively, the "Companies"), respectively, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
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4. Designated Securities to be purchased by each Underwriter pursuant
to the Pricing Agreement relating thereto, in definitive form to the extent
practicable, and in such authorized denominations and registered in such names
as the Representatives may request upon at least forty-eight hours' prior notice
to the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable to the order of the Company in the funds
specified in such Pricing Agreement, all at the place and time and date
specified in such Pricing Agreement or at such other place and time and date as
the Representatives and the Company may agree upon in writing, such time and
date being herein called the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended and supplemented in
relation to the applicable Designated Securities in a form approved by
the Representatives and to file such Prospectus pursuant to Rule 424(b)
under the Act not later than the Commission's close of business on the
second business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Securities or, if
applicable, such earlier time as may be required by Rule 424(b); to
make no further amendment or any supplement to the Registration
Statement or Prospectus as amended or supplemented after the date of
the Pricing Agreement relating to such Securities and prior to the Time
of Delivery for such Securities which shall be disapproved by the
Representatives for such Securities promptly after reasonable notice
thereof; to advise the Representatives promptly of any such amendment
or supplement after such Time of Delivery and furnish the
Representatives with copies thereof; to file promptly all reports and
any definitive proxy or information statements required to be filed by
the Company with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act for so long as the delivery of a prospectus
is required in connection with the offering or sale of such Securities,
and during such same period to advise the Representatives, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
with the Commission, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any
prospectus relating to the Securities, of the suspension of the
qualification of such Securities for offering or sale in any
jurisdiction, of the initiation of or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending
or supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any such
stop order or of any such order preventing or suspending the use of any
prospectus relating to the Securities or suspending any such
qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions in
the United States as the Representatives may request and to comply with
such laws so as to permit the continuance of sales and dealings therein
in such jurisdictions for as long as may be necessary to complete the
distribution of such Securities, provided that in connection therewith
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the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus
as amended or supplemented in such quantities as the Representatives
may from time to time reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the
offering or sale of any Designated Securities and if at such time any
event shall have occurred as a result of which the Prospectus 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 when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such same period to amend
or supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus in order to comply
with the Act, the Exchange Act or the Trust Indenture Act, to notify
the Representatives and upon their request to file such document and to
prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Representatives may from
time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or
omission or effect such compliance; and in case any Underwriter is
required to deliver a prospectus in connection with sales of any
Designated Securities at any time nine months or more after the time of
issue of the Prospectus as amended or supplemented with respect to such
Designated Securities, upon the request of the Representatives but at
the expense of such Underwriter, to prepare and deliver to such
Underwriter as many copies as it may request of a further amended or
supplemented Prospectus for such Designated Securities complying with
Section 10(a)(3) of the Act;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) ), an earning statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11 (a) of the Act
and the rules and regulations of the Commission thereunder (including
at the option of the Company Rule 158); and
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and
including the earlier of (i) the termination of trading restrictions
for such Designated Securities, as notified to the Company by the
Representatives, and (ii) the Time of Delivery for such Designated
Securities, not to offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company which mature more than one year
after such Time of Delivery and which are substantially similar to such
Designated Securities, without the prior written consent of the
Representatives.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of
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printing or producing any Agreement among Underwriters, this Agreement, any
Pricing Agreement, any Indenture, any Blue Sky and Legal Investment Memoranda
and any other documents in connection with the offering, purchase, sale and
delivery of the Securities; (iii) all expenses in connection with the
qualification of the Securities for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky and legal investment surveys;
(iv) any fees charged by securities rating services for rating the Securities;
(v) any filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the
Securities; (vi) the cost of preparing the Securities; (vii) the fees and
expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities; (viii) the fees and disbursements of counsel for the
Underwriters to the extent they exceed such amount as may be specified in the
Pricing Agreements; and (ix) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, Section 8 and Section 11 hereof, the Underwriters will
pay all of their own costs and expenses, including, but not limited to, the fees
and disbursements of their counsel up to such amount as may be specified in the
Pricing Agreements, transfer taxes on resale of any of the Securities by them,
and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities
under the Pricing Agreement relating to such Designated Securities shall be
subject, in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in or
incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of the Time of Delivery for such Designated
Securities, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to
the applicable Designated Securities shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act
and in accordance with Section 5 (a) hereof; no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Representatives' reasonable satisfaction;
(b) Counsel for the Underwriters shall have furnished to the
Representatives such opinion or opinions, dated the Time of Delivery
for such Designated Securities, with respect to the incorporation of
the Company, the validity of the Indenture, the Designated Securities,
the Registration Statement, the Prospectus as amended or supplemented
and other related matters as the Representatives may reasonably
request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon
such matters;
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(c) Paul Heldman, Senior Vice President, Secretary and General
Counsel of the Company, shall have furnished to the Representatives his
written opinion, dated the Time of Delivery for such Designated
Securities, in form and substance satisfactory to the Representatives,
to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of Ohio, with corporate power and authority to own its
properties and conduct its business as described in the
Prospectus as amended or supplemented;
(ii) The Company has an authorized capitalization as
set forth in the Prospectus as amended or supplemented, and
all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid
and non-assessable;
(iii) The Company has been duly qualified as a
foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business,
so as to require such qualification, or is subject to no
material liability or disability by reason of the failure to
be so qualified in any such jurisdiction (such counsel being
entitled to rely in respect of the opinion in this clause upon
opinions of local counsel and in respect of matters of fact
upon certificates of officers of the Company, provided that
such counsel shall state that he believes that both the
Underwriters and he are justified in relying upon such
opinions and certificates);
(iv) Each subsidiary of the Company, with respect to
which the Company owns, directly or indirectly, an equity
interest of more than 50% (each a "subsidiary"), has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation;
and all of the issued shares of capital stock of each such
subsidiary have been duly and validly authorized and issued,
are fully paid and non-assessable, and (except for directors'
qualifying shares) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities
or claims, other than as described in the Prospectus (such
counsel being entitled to rely in respect of the opinion in
this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company,
provided that such counsel shall state that he believes that
both the Underwriters and he are justified in relying upon
such opinions and certificates);
(v) The Company and its subsidiaries have good and
marketable title in fee simple to all real property owned by
them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or
such as do not materially affect the value of such property
and do not interfere with the use made and proposed to be made
of such property by the Company and its subsidiaries; and any
real property and buildings held under lease by the Company
and its subsidiaries are held by them under valid, subsisting
and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed
to be made of such property and buildings by the Company and
its subsidiaries (in giving the opinion in this clause, such
counsel may state that no examination of record titles for the
9
<PAGE> 10
purpose of such opinion has been made, and that he is relying
upon a general review of the titles of the Company and its
subsidiaries, upon opinions of local counsel and abstracts,
reports and policies of title companies rendered or issued at
or subsequent to the time of acquisition of such property by
the Company or its subsidiaries, upon opinions of counsel to
the lessors of such property and, in respect of matters of
fact, upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that he
believes that both the Underwriters and he are justified in
relying upon such opinions, abstracts, reports, policies and
certificates);
(vi) To the best of such counsel's knowledge and
other than as set forth in the Prospectus, there are no legal
or governmental proceedings pending to which the Company or
any of its subsidiaries is a party or of which any property of
the Company or any of its subsidiaries is the subject with
respect to which there is a reasonable likelihood of
determinations which would individually or in the aggregate
have a material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of the
Company and its subsidiaries; and, to the best of such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others;
(vii) This Agreement and the Pricing Agreement with
respect to the Designated Securities have been duly
authorized, executed and delivered by the Company;
(viii) The Designated Securities have been duly
authorized, executed, authenticated, issued and delivered, and
the Designated Securities (assuming that (i) the Trustee has
all requisite power and authority to perform its obligations
under the Indenture and has made all necessary filings and
received all necessary consents, (ii) the Indenture has been
duly authorized, executed and delivered by the Trustee and
(iii) the Trustee's certificates of authentication have been
manually executed by an authorized officer of the Trustee)
constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms
and are entitled to the benefits of the Indenture, except that
(a) such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium, or other laws now or hereafter in
effect affecting creditors' rights generally, and (b) the
enforceability thereof is subject to the general principles of
equity (whether such enforceability is considered in a
proceeding in equity or at law); provided, however, that such
counsel need express no opinion as to the application or
effect of any applicable fraudulent conveyance, fraudulent
transfer, fraudulent obligation or preferential transfer laws
or any laws governing the distribution of assets of the
Company to its stockholders; and the terms of the Designated
Securities and the Indenture conform in all material respects
to the descriptions thereof in the Prospectus as amended or
supplemented;
(ix) The Indenture (i) has been duly authorized,
executed and delivered by the Company and (ii) (assuming that
(a) the Trustee has all requisite power and authority to
perform its obligations under the Indenture and has made all
necessary filings and received all necessary consents, and (b)
the Indenture has been duly authorized, executed and delivered
by the Trustee) constitutes a valid and binding instrument of
the Company, enforceable in
10
<PAGE> 11
accordance with its terms, except (a) that such enforcement
may be subject to bankruptcy, insolvency, reorganization,
moratorium, or other laws now or hereafter in effect affecting
creditors' rights generally, and (b) that the enforceability
thereof is subject to general principles of equity (whether
such enforceability is considered in a proceeding in equity or
at law); provided, however, that such counsel need express no
opinion as to the application or effect of any applicable
fraudulent conveyance, fraudulent transfer, fraudulent
obligation or preferential transfer laws or any laws governing
the distribution of assets of the Company to its stockholders;
and the Indenture has been duly qualified under the Trust
Indenture Act;
(x) The issuance and sale of the Designated
Securities and the compliance by the Company with all of the
provisions of the Designated Securities, the Indenture, this
Agreement and the Pricing Agreement with respect to the
Designated Securities and the consummation of the transactions
herein and therein contemplated, to the best of such counsel's
knowledge, will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject,
nor will such actions result in any violation of the
provisions of the Articles of Incorporation, as amended, or
the Regulations of the Company or any statute of the United
States of America or of Ohio or any other statute known to
such counsel or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties;
provided, however, that such counsel need express no opinion
as to the application or effect of any applicable fraudulent
conveyance, fraudulent transfer, fraudulent obligation or
preferential transfer laws or any laws governing the
distribution of assets of the Company to its stockholders;
(xi) To the best of such counsel's knowledge, no
consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency
or body is required for the issuance and sale of the
Designated Securities or the consummation of the other
transactions contemplated by this Agreement or such Pricing
Agreement or the Indenture, except such as have been obtained
under the Act and the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the
Designated Securities by the Underwriters and as may be
required due to the Underwriters' or the Trustees' legal or
regulatory status;
(xii) The Company is not subject to regulation under
the Investment Company Act of 1940, as amended;
(xiii) The documents incorporated by reference in the
Prospectus as amended or supplemented (other than (a) the
financial statements, notes and schedules thereto included or
incorporated by reference therein and (b) other financial and
statistical information included or incorporated by reference
therein, as to all of which such counsel need express no
opinion), when they
11
<PAGE> 12
became effective or were filed with the Commission, as the
case may be, complied as to form in all material respects with
the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder; and such counsel has no reason to believe that any
of such documents, when they became effective or were so
filed, as the case may be, contained, in the case of a
registration statement which became effective under the Act,
an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading, or, in the case of
other documents which were filed under the Act or the Exchange
Act with the Commission, an untrue statement of a material
fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made when such documents were so filed,
not misleading; and
(xiv) The Registration Statement and the Prospectus
as amended or supplemented and any further amendments and
supplements thereto made by the Company prior to the Time of
Delivery for the Designated Securities (other than (a) the
financial statements, notes and schedules thereto included or
incorporated by reference therein, (b) other financial and
statistical information included or incorporated by reference
therein or (c) the Forms T-1 filed as exhibits to the
Registration Statement, as to all of which such counsel need
express no opinion) comply as to form in all material respects
with the requirements of the Act and the Trust Indenture Act
and the rules and regulations thereunder; such counsel has no
reason to believe that, as of its effective date, the
Registration Statement or any further amendment thereto made
by the Company prior to the Time of Delivery (other than (a)
the financial statements, notes and schedules thereto included
or incorporated by reference therein, (b) other financial and
statistical information included or incorporated by reference
therein or (c) the Forms T-1 filed as exhibits to the
Registration Statement, as to all of which such counsel need
express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading or that, as of its date, the Prospectus as
amended or supplemented or any further amendment or supplement
thereto made by the Company prior to the Time of Delivery
(other than (a) the financial statements, notes and schedules
thereto included or incorporated by reference therein, (b)
other financial and statistical information included or
incorporated by reference therein or (c) the Forms T-1 filed
as exhibits to the Registration Statement, as to all of which
such counsel need express no opinion) contained an untrue
statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading or that,
as of the Time of Delivery, either the Registration Statement
or the Prospectus as amended or supplemented or any further
amendment or supplement thereto made by the Company prior to
the Time of Delivery (other than (a) the financial statements,
notes and schedules thereto included or incorporated by
reference therein, (b) other financial and statistical
information included or incorporated by reference therein or
(c) the Forms T-1 filed as exhibits to the Registration
Statement, as to all of which such counsel need express no
opinion) contains an untrue statement of a material fact or
omits to state a material fact necessary to make the
statements therein, in light of the circumstances in which
they were made, not misleading; and such counsel does not know
of any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character
required
12
<PAGE> 13
to be filed as an exhibit to the Registration Statement or
required to be incorporated by reference into the Prospectus
as amended or supplemented or required to be described in the
Registration Statement or the Prospectus as amended or
supplemented which are not filed or incorporated by reference
or described as required;
(d) On the date of the Pricing Agreement for such Designated
Securities and at the Time of Delivery for such Designated Securities,
the independent accountants of the Company who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement shall have
furnished to the Representatives letters, dated the respective dates of
delivery of such letters, to the effect set forth in Annex II hereto,
in form and substance satisfactory to the Representatives;
(e) [Intentionally Omitted]
(f) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus as
amended or supplemented any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus as amended or supplemented, and (ii) since the respective
dates as of which information is given in the Prospectus as amended or
supplemented there shall not have been any change in the capital stock
or long-term debt of the Companies or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Companies, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, the effect
of which, in any such case described in Clause (i) or (ii), is in the
judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Designated Securities on the terms and in the manner
contemplated in the Prospectus as amended or supplemented;
(g) On or after the date of the Pricing Agreement relating to
the Designated Securities (i) no downgrading shall have occurred in the
rating accorded the Companies' debt securities by any "nationally
recognized statistical rating organization," as that term is defined by
the Commission for purposes of Rule 436(g) (2) under the Act and (ii)
no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of the Companies' debt securities;
(h) On or after the date of the Pricing Agreement relating to
the Designated Securities there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a general
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities; or (iii) the outbreak or
escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the
effect of any such event specified in this Clause (iii) in the judgment
of the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Designated
13
<PAGE> 14
Securities on the terms and in the manner contemplated by the
Prospectus as amended and supplemented;
(i) The Company shall have furnished or caused to be furnished
to the Representatives at the Time of Delivery for the Designated
Securities a certificate or certificates of officers of the Company
satisfactory to the Representatives as to the accuracy of the
representations and warranties of the Company herein at and as of such
Time of Delivery, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (f) of
this Section and as to such other matters as the Representatives may
reasonably request; and
(j) On the date of the Pricing Agreement for such Designated
Securities and at the Time of Delivery for such Designated Securities,
the independent accountants of Fred Meyer, Inc. who have certified the
financial statements of Fred Meyer, Inc. and its subsidiaries included
or incorporated by reference in the Registration Statement shall have
furnished to the Representatives letters, dated the respective dates of
delivery of such letters, to the effect set forth in Annex III hereto,
in form and substance satisfactory to the Representatives.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim; provided, however, that the Company shall 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 or
omission or alleged omission made in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter of Designated Securities
through the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
14
<PAGE> 15
make the statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Securities, or
any such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel 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 shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
of the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters of the Designated Securities on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and such Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by such Underwriters, in each case as set forth in the
table on the cover page of the Prospectus as amended or supplemented to relate
to a particular offering of Designated Securities. 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
15
<PAGE> 16
omission to state a material fact relates to information supplied by the Company
on the one hand or such Underwriters on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in 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 such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the applicable Designated Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of Designated
Securities in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations with respect to such Securities and
not joint.
(e) The obligations of the Company under this Section 8 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
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Designated Securities on such terms. In the event that, within the
respective prescribed period, the Representatives notify the Company that they
have so arranged for the purchase of such Designated Securities, or the Company
notifies the Representatives that it has so arranged for the purchase of such
Designated Securities, the Representatives or the Company shall have the right
to postpone the Time of Delivery for such Designated Securities for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this
16
<PAGE> 17
Section with like effect as if such person had originally been a party to the
Pricing Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Section 6 and Section 8 hereof; but, if for any other
reason Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Securities, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Section 6 and Section 8 hereof.
17
<PAGE> 18
12. In all dealings hereunder, the Representatives of the Underwriters
of Designated Securities shall act on behalf of each of such Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Section 8 and Section 10 hereof, the officers and directors
of the Company and each person who controls the Company or any Underwriter, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
18
<PAGE> 19
Very Truly Yours,
Attest: THE KROGER CO.
Each of the Guarantors Listed on Schedule I
hereto, as Guarantor of the Designated
Securities
By:
- -----------------------------
Assistant Secretary/Secretary Name: Lawrence M. Turner
Title: Vice President and Treasurer
Attest: RJD ASSURANCE, INC.,
as Guarantor of the Designated Securities
VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Designated Securities
By:
- ----------------------------- ----------------------------------------
Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
RICHIE'S INC., as Guarantor of the
Designated Securities
By:
----------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
19
<PAGE> 20
ROCKET NEWCO, INC.,
as Guarantor of the Designated Securities
HENPIL, INC.,
as Guarantor of the Designated Securities
WYDIV, INC.,
as Guarantor of the Designated Securities
By:
----------------------------------------
Name: Steven McMillan
Title: Vice President and Secretary
20
<PAGE> 21
SCHEDULE I
Guarantors
Name of Guarantor State of Organization
- ----------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
CB&S Advertising Agency, Inc. Oregon
City Market, Inc. Colorado
Compare, Inc. Delaware
Crawford Stores, Inc. California
Dillon Companies, Inc. Kansas
Dillon Real Estate Co., Inc. Kansas
Distribution Trucking Company Oregon
Drugs Distributors, Inc. Indiana
FM Holding Corporation Delaware
FM Retail Services, Inc. Washington
FM, Inc. Utah
Food 4 Less GM, Inc. California
Food 4 Less Holdings, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Fred Meyer, Inc. Delaware
Fred Meyer Jewelers, Inc. Delaware
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Stores, Inc. Delaware
Grand Central, Inc. Utah
Hughes Markets, Inc. California
Hughes Realty, Inc. California
Inter-American Foods, Inc. Ohio
Jackson Ice Cream Co., Inc. Kansas
JH Properties, Inc. Washington
Junior Food Stores of West Florida, Inc. Florida
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
Kroger Dedicated Logistics Co. Ohio
Kroger Limited Partnership I Ohio (limited partnership)
Kroger Limited Partnership II Ohio (limited partnership)
Kroger Texas L.P. Ohio (limited partnership)
KU Acquisition Corporation Washington
Kwik Shop, Inc. Kansas
Merksamer Jewelers, Inc. California
Mini Mart, Inc. Wyoming
Peyton's-Southeastern, Inc. Tennessee
QFC Sub, Inc. Washington
Quality Food Centers, Inc. Washington
Quality Food Holdings, Inc. Delaware
21
<PAGE> 22
Name of Guarantor State of Organization
- ----------------- ---------------------
Quality Food, Inc. Delaware
Quik Stop Markets, Inc. California
Ralphs Grocery Company Delaware
Roundup Co. Washington
Saint Lawrence Holding Company Delaware
Second Story, Inc. Washington
Smith's Beverage of Wyoming, Inc. Wyoming
Smith's Food & Drug Centers, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Smitty's Supermarkets, Inc. Delaware
The Kroger Co. of Michigan Michigan
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Topvalco, Inc. Ohio
Treasure Valley Land Company, L.C. Idaho
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Western Property Investment Group, Inc. California
22
<PAGE> 23
ANNEX I
Pricing Agreement
[NAMES OF CO-REPRESENTATIVE(S),]
As Representatives of the several
Underwriters named in Schedule I hereto,
...................., 19..
Dear Sirs:
The Kroger Co., an Ohio corporation (the "Company"), proposes, subject
to the terms and conditions stated herein and in the Underwriting Agreement,
dated .................... (the "Underwriting Agreement"), to issue and sell to
the Underwriters named in Schedule I hereto (the "Underwriters") the Securities
specified in Schedule II hereto (the "Designated Securities"). Each of the
provisions of the Underwriting Agreement is incorporated herein by reference in
its entirety, and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined. The Representatives designated to
act on behalf of each of the Underwriters of the Designated Securities pursuant
to Section 12 of the Underwriting Agreement and the address of the
Representatives referred to in such Section 12 are set forth at the end of
Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us __ counterparts hereof, and upon acceptance hereof by you, on
behalf of each of
23
<PAGE> 24
the Underwriters, this letter and such acceptance hereof, including the
provisions of the Underwriting Agreement incorporated herein by reference, shall
constitute a binding agreement between each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is or will be pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very Truly Yours,
Attest: THE KROGER CO.
By:
Name:
- ----------------------------- Title:
Assistant Secretary/Secretary
24
<PAGE> 25
Accepted as of the date hereof:
[NAME(S) OF CO-REPRESENTATIVE(S)]
On behalf of each of the Underwriters
25
<PAGE> 26
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
DESIGNATED
SECURITIES
TO BE
UNDERWRITER PURCHASED
- --------------------------------------------------------------------------------
<S> <C>
[Name(s) of Co-Representative(s) $
[Names of other Underwriters]
------------------
Total $
</TABLE>
26
<PAGE> 27
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due
AGGREGATE PRINCIPAL AMOUNT:
[$]
PRICE TO PUBLIC:
% of the principal amount of the Designated Securities, plus
accrued interest from to [and accrued amortization,
if any, from to ]
PURCHASE PRICE BY UNDERWRITERS:
% of the principal amount of the Designated Securities, plus
accrued interest from to [and accrued amortization,
if any, from to ]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
[New York] Clearing House funds
INDENTURE:
Indenture dated , 19 , between the Company and ,
as Trustee
MATURITY:
INTEREST RATE:
[ %] [Zero Coupon] [See Floating Rate Provisions]
INTEREST PAYMENT DATES:
[months and dates]
REDEMPTION PROVISIONS:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$] or an integral multiple thereof, [on or
after , at the following redemption prices (expressed in
percentages of principal amount). If [redeemed on or before ,
%, and if] redeemed during the 12-month period beginning ,
REDEMPTION YEAR PRICE
--------------------------------------------------------------
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.] [on any interest payment
date falling in or after , at the election of the
Company, at a redemption price equal to the principal amount thereof, plus
accrued interest to the date of redemption.] [Other possible redemption
provisions, such as mandatory redemption upon occurrence of certain events
or redemption for changes in tax law] [Restriction on refunding]
27
<PAGE> 28
SINKING FUND PROVISIONS:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund
to retire [$] principal amount of Designated Securities on in
each of the years through at 100% of their principal amount
plus accrued interest] [,together with [cumulative] [noncumulative]
redemptions at the option of the Company to retire an additional [$]
principal amount of Designated Securities in the years through
at 100% of their principal amount plus accrued interest].
[If Securities are extendable debt Securities, insert--
EXTENDABLE PROVISIONS:
Securities are repayable on , [insert date and
years], at the option of the holder, at their principal amount with
accrued interest. Initial annual interest rate will be %, and
thereafter annual interest rate will be adjusted on ,
and to a rate not less than % of the effective annual interest rate on
U.S. Treasury obligations with -year maturities as of the [insert date
15 days prior to maturity date] prior to such [insert maturity date].]
[If Securities are Floating Rate debt Securities, insert--
FLOATING RATE PROVISIONS:
Initial annual interest rate will be % through [and thereafter
will be adjusted [monthly] [on each , , and ] [to
an annual rate of % above the average rate for -year [month]
[securities] [certificates of deposit] issued by
and [insert names of banks].] [and the annual interest rate
[thereafter] [from through ] will be the interest yield
equivalent of the weekly average per annum market discount rate for
-month Treasury bills plus % of Interest Differential (the excess,
if any, of (i) then current weekly average per annum secondary market
yield for -month certificates of deposit over (ii) then current
interest yield equivalent of the weekly average per annum market discount
rate for -month Treasury bills); [from and thereafter the rate
will be the then current interest yield equivalent plus % of Interest
Differential].]
DEFEASANCE PROVISIONS:
TIME OF DELIVERY:
CLOSING LOCATION:
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives:
Address for Notices, etc.:
[OTHER TERMS]:
28
<PAGE> 29
ANNEX II
Pursuant to Section 7 (d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the Act
and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules audited (and, if
applicable, prospective financial statements and/or pro forma financial
information examined) by them and included or incorporated by reference in
the Registration Statement or the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the Act
or the Exchange Act, as applicable, and the related published rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information,
prospective financial statements and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been furnished to the representatives of the Underwriters (the
"Representatives");
(iii) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Company's
Annual Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(iv) On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards, consisting
of a reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of the Company and its subsidiaries, inspection of the minute
books of the Company and its subsidiaries since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other inquiries
and procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included or incorporated by reference in the Company's Quarterly
Reports on Form 10-Q incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form
10-Q and the related published rules and regulations thereunder or
are not in conformity with generally accepted accounting principles
applied on a basis substantially consistent with the basis for the
audited consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included or
incorporated by
-29-
<PAGE> 30
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with
the basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of
those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus, and sales of
capital stock to employee benefit plans of the Company) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
net assets or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with amounts shown in the latest balance sheet included
or incorporated by reference in the Prospectus, except in each case
for changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
increases or decreases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(v) In addition to the audit referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (iv) above, they have carried out
certain specified procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the
-30-
<PAGE> 31
Representatives, which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference), or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the
Prospectus specified by the Representatives, and have compared certain of
such amounts, percentages and financial information with the accounting
records of the Company and its subsidiaries and have found them to be in
agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
-31-
<PAGE> 32
ANNEX III
Pursuant to Section 7 (k) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to Fred Meyer, Inc. and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules audited (and, if
applicable, prospective financial statements and/or pro forma financial
information examined) by them and included or incorporated by reference in
the Registration Statement or the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the Act
or the Exchange Act, as applicable, and the related published rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information,
prospective financial statements and/or condensed financial statements
derived from audited financial statements of Fred Meyer, Inc. for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the representatives of the
Underwriters (the "Representatives");
(iii) On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards, consisting
of a reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of Fred Meyer, Inc. and its subsidiaries, inspection of the
minute books of Fred Meyer, Inc. and its subsidiaries since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus, inquiries of officials of Fred Meyer, Inc.
and its subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included or incorporated by reference in Fred Meyer, Inc.'s
Quarterly Reports on Form 10-Q incorporated by reference in the
Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act as it applies
to Form 10-Q and the related published rules and regulations
thereunder or are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent
with the basis for the audited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included or incorporated by reference in Fred Meyer, Inc.'s Annual
Report on Form 10-K for the most recent fiscal year;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with
the basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by
-32-
<PAGE> 33
reference in Fred Meyer, Inc.'s Annual Report on Form 10-K for the
most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in Fred
Meyer, Inc.'s Annual Report on Form 10-K for the most recent fiscal
year; and
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of
those statements.
(iv) In addition to the audit referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraph (iii) above, they have carried out certain
specified procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Representatives,
which are derived from the general accounting records of Fred Meyer, Inc.
and its subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages
and financial information with the accounting records of Fred Meyer, Inc.
and its subsidiaries and have found them to be in agreement.
All references in this Annex III to the Prospectus shall be deemed to
refer to the Prospectus (including the documents incorporated by reference
therein) as defined in the Underwriting Agreement as of the date of the letter
delivered on the date of the Pricing Agreement for purposes of such letter and
to the Prospectus as amended or supplemented (including the documents
incorporated by reference therein) in relation to the applicable Designated
Securities for purposes of the letter delivered at the Time of Delivery for such
Designated Securities.
-33-
<PAGE> 1
Exhibit 1.1.1
Pricing Agreement
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
BANC OF AMERICA SECURITIES LLC
BANC ONE CAPITAL MARKETS, INC.
U.S. BANCORP PIPER JAFFRAY INC.
As Representatives of the several
Underwriters named in Schedule II hereto,
February 4, 2000
Dear Sirs:
The Kroger Co., an Ohio corporation (the "Company"), and the
Guarantors on Schedule I and on the signature pages hereto propose, subject to
the terms and conditions stated herein and in the Underwriting Agreement, dated
February 4, 2000 (the "Underwriting Agreement"), to issue and sell to the
Underwriters named in Schedule II hereto (the "Underwriters") the Securities
(the "Designated Securities") and related Guarantees specified in Schedule III
hereto. Each of the provisions of the Underwriting Agreement is incorporated
herein by reference in its entirety, and shall be deemed to be a part of this
Agreement to the same extent as if such provisions had been set forth in full
herein; and each of the representations and warranties set forth therein shall
be deemed to have been made at and as of the date of this Pricing Agreement,
except that each representation and warranty which refers to the Prospectus in
Section 2 of the Underwriting Agreement shall be deemed to be a representation
or warranty as of the date of the Underwriting Agreement in relation to the
Prospectus (as therein defined), and also a representation and warranty as of
the date of this Pricing Agreement in relation to the Prospectus as amended or
supplemented relating to the Designated Securities and related Guarantees. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined. The Representatives designated to
act on behalf of each of the Underwriters of the Designated Securities and
related Guarantees pursuant to Section 12 of the Underwriting Agreement and the
address of the Representatives referred to in such Section 12 are set forth at
the end of Schedule III hereto.
An amendment to the Registration Statement, or a supplement to
the Prospectus, as the case may be, relating to the Designated Securities and
related Guarantees, in the form heretofore delivered to you is now proposed to
be filed with the Commission.
<PAGE> 2
Subject to the terms and conditions set forth herein and in
the Underwriting Agreement incorporated herein by reference, the Company agrees
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the time and
place and at the purchase price to the Underwriters, and under other terms and
conditions set forth in Schedule III hereto, the principal amount of Designated
Securities set forth opposite the name of such Underwriter in Schedule II
hereto.
If the foregoing is in accordance with your understanding,
please sign and return to us six counterparts hereof, and upon acceptance hereof
by you, on behalf of each of the Underwriters, this letter and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters, the Company and each of the Guarantors. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is or will be
pursuant to the authority set forth in a form of Agreement among Underwriters,
the form of which shall be submitted to the Company for examination upon
request, but without warranty on the part of the Representatives as to the
authority of the signers thereof.
<PAGE> 3
Very Truly Yours,
Attest: THE KROGER CO.
Each of the Guarantors Listed on
Schedule I hereto, as Guarantor of the
Designated Securities
By:
- -----------------------------
Assistant Secretary/Secretary Name: Lawrence M. Turner
Title: Vice President and Treasurer
Attest: RJD ASSURANCE, INC.,
as Guarantor of the Designated Securities
VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Designated Securities
By:
- ----------------------------- -------------------------------------
Assistant Treasurer Name: Bruce M. Gack
Title: Vice President
RICHIE'S INC., as Guarantor of the
Designated Securities
By:
-------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
ROCKET NEWCO, INC.,
as Guarantor of the Designated Securities
HENPIL, INC.,
as Guarantor of the Designated Securities
WYDIV, INC.,
as Guarantor of the Designated Securities
By:
-------------------------------------
Name: Steven McMillan
Title: Vice President and Secretary
<PAGE> 4
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
BANC OF AMERICA SECURITIES LLC
BANC ONE CAPITAL MARKETS, INC.
U.S. BANCORP PIPER JAFFRAY INC.
By:_________________________________________________
(Goldman, Sachs & Co.)
On behalf of each of the Underwriters
<PAGE> 5
SCHEDULE I
Guarantors
Name of Guarantor State of Organization
- ----------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
CB&S Advertising Agency, Inc. Oregon
City Market, Inc. Colorado
Compare, Inc. Delaware
Crawford Stores, Inc. California
Dillon Companies, Inc. Kansas
Dillon Real Estate Co., Inc. Kansas
Distribution Trucking Company Oregon
Drugs Distributors, Inc. Indiana
FM Holding Corporation Delaware
FM Retail Services, Inc. Washington
FM, Inc. Utah
Food 4 Less GM, Inc. California
Food 4 Less Holdings, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Fred Meyer, Inc. Delaware
Fred Meyer Jewelers, Inc. Delaware
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Stores, Inc. Delaware
Grand Central, Inc. Utah
Hughes Markets, Inc. California
Hughes Realty, Inc. California
Inter-American Foods, Inc. Ohio
Jackson Ice Cream Co., Inc. Kansas
JH Properties, Inc. Washington
Junior Food Stores of West Florida, Inc. Florida
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
Kroger Dedicated Logistics Co. Ohio
<PAGE> 6
Name of Guarantor State of Organization
- ----------------- ---------------------
Kroger Limited Partnership I Ohio (limited partnership)
Kroger Limited Partnership II Ohio (limited partnership)
Kroger Texas L.P. Ohio (limited partnership)
KU Acquisition Corporation Washington
Kwik Shop, Inc. Kansas
Merksamer Jewelers, Inc. California
Mini Mart, Inc. Wyoming
Peyton's-Southeastern, Inc. Tennessee
QFC Sub, Inc. Washington
Quality Food Centers, Inc. Washington
Quality Food Holdings, Inc. Delaware
Quality Food, Inc. Delaware
Quik Stop Markets, Inc. California
Ralphs Grocery Company Delaware
Roundup Co. Washington
Saint Lawrence Holding Company Delaware
Second Story, Inc. Washington
Smith's Beverage of Wyoming, Inc. Wyoming
Smith's Food & Drug Centers, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Smitty's Supermarkets, Inc. Delaware
The Kroger Co. of Michigan Michigan
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Topvalco, Inc. Ohio
Treasure Valley Land Company, L.C. Idaho
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Western Property Investment Group, Inc. California
<PAGE> 7
SCHEDULE II
<TABLE>
<CAPTION>
UNDERWRITER PRINCIPAL AMOUNT OF 8.05% SENIOR
NOTES DUE 2010 TO BE PURCHASED
<S> <C>
Goldman, Sachs & Co. $175,000,000
Chase Securities Inc. 175,000,000
Banc of America Securities LLC 50,000,000
Banc One Capital Markets, Inc. 50,000,000
U.S. Bancorp Piper Jaffray Inc. 50,000,000
------------
Total $500,000,000
</TABLE>
<PAGE> 8
SCHEDULE III
TITLE OF DESIGNATED SECURITIES:
8.05% Senior Notes due 2010
AGGREGATE PRINCIPAL AMOUNT:
$500,000,000 of 8.05% Senior Notes due 2010
PRICE TO PUBLIC:
99.828% of the principal amount of the 8.05% Senior Notes due 2010, plus
accrued interest from February 11, 2000.
PURCHASE PRICE BY UNDERWRITERS:
99.178% of the principal amount of the 8.05% Senior Notes due 2010, plus
accrued interest from February 11, 2000.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Immediately available funds
INDENTURE:
Indenture dated as of June 25, 1999, between the Company, the Guarantors
and Firstar Bank, National Association, as Trustee, as supplemented by the
First Supplemental Indenture, dated June 25, 1999, the Second Supplemental
Indenture, dated June 25, 1999, the Third Supplemental Indenture, dated
June 25, 1999, the Fourth Supplemental Indenture, dated September 22,
1999, the Fifth Supplemental Indenture, dated September 22, 1999, the
Sixth Supplemental Indenture, dated September 22, 1999, and the Seventh
Supplemental Indenture, dated February 11, 2000.
MATURITY:
The 8.05% Senior Notes due 2010 will mature on February 1, 2010
INTEREST RATES:
The 8.05% Senior Notes due 2010 will bear interest from February 11, 2000
at 8.05%.
INTEREST PAYMENT DATES:
Interest on the 8.05% Senior Notes due 2010 is payable semiannually on
February 1 and August 1 of each year commencing on August 1, 2000.
<PAGE> 9
REDEMPTION PROVISIONS:
As described in the Prospectus Supplement dated February 4, 2000.
SINKING FUND PROVISION:
No sinking fund provisions.
DEFEASANCE PROVISIONS:
As described in the Prospectus Supplement dated February 4, 2000.
GUARANTEES:
Guaranteed by the Guarantors set forth on the signature pages and
Schedule I to the Pricing Agreement.
TIME OF DELIVERY:
February 11, 2000
CLOSING LOCATION:
Offices of Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza,
New York, New York 10004
NAME AND ADDRESS OF REPRESENTATIVES:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
<PAGE> 1
Exhibit 4.3.1
SEVENTH SUPPLEMENTAL INDENTURE, dated as of February 11, 2000,
between The Kroger Co., a corporation duly organized and existing under the laws
of the State of Ohio (herein called the "Company"), having its principal office
at 1014 Vine Street, Cincinnati, Ohio 45202, the Guarantors listed on the
signature pages and Schedule I hereto (each, a "Guarantor") and Firstar Bank,
National Association, a banking corporation duly organized and existing under
the laws of the State of Ohio, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of June 25, 1999 (the "Indenture"), between the
Company, the Guarantors and Firstar Bank, National Association, as Trustee, as
supplemented by the First Supplemental Indenture dated June 25, 1999, the Second
Supplemental Indenture dated June 25, 1999, the Third Supplemental Indenture
dated June 25, 1999, the Fourth Supplemental Indenture dated September 22, 1999,
the Fifth Supplemental Indenture dated September 22, 1999 and the Sixth
Supplemental Indenture dated September 22, 1999, providing for the issuance from
time to time of the Company's unsecured debentures, notes or other evidences of
indebtedness (herein and therein called the "Securities"), to be issued in one
or more series as in the Indenture provided.
Section 201 of the Indenture permits the form of the
Securities of any series to be established pursuant to an indenture supplemental
to the Indenture.
Section 301 of the Indenture permits the terms of the
Securities of any series to be established in an indenture supplemental to the
Indenture.
Section 901(7) of the Indenture provides that, without the
consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture for the purpose of establishing the
form or terms of Securities of any series as permitted by Sections 201 and 301
of the Indenture.
Each of the Guarantors has duly authorized the issuance of a
guarantee of the Securities, as set forth herein, and to provide therefor, each
of the Guarantors has duly
<PAGE> 2
authorized the execution and delivery of this Seventh Supplemental Indenture.
The Company and the Guarantors, pursuant to the foregoing
authority, propose in and by this Seventh Supplemental Indenture to establish
the terms and form of the Securities of a new series and to amend and supplement
the Indenture in certain respects with respect to the Securities of such series.
All things necessary to make this Seventh Supplemental
Indenture a valid agreement of the Company and the Guarantors, and a valid
amendment of and supplement to the Indenture, have been done.
NOW, THEREFORE, THIS SEVENTH Supplemental Indenture
WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities of the series to be
created hereby, as follows:
ARTICLE ONE
DEFINITIONS
Section 101. Definitions.
(a) For all purposes of this Seventh Supplemental Indenture:
(1) Capitalized terms used herein without definition
shall have the meanings specified in the Indenture;
(2) All references herein to Articles and Sections,
unless otherwise specified, refer to the corresponding
Articles and Sections of this Seventh Supplemental Indenture
and, where so specified, to the Articles and Sections of the
Indenture as supplemented by this Seventh Supplemental
Indenture; and
(3) The terms "hereof", "herein", "hereby", "hereto",
"hereunder" and "herewith" refer to this Seventh Supplemental
Indenture.
(b) For all purposes of the Indenture and this Seventh
Supplemental Indenture, with respect to the Securities of the series created
hereby, except as otherwise expressly provided or unless the context otherwise
requires:
"Adjusted Treasury Rate" means, with respect to any
Redemption Date, the rate per annum equal to the semi-annual
-2-
<PAGE> 3
equivalent yield to maturity of the Comparable Treasury Issue,
assuming a price for the Comparable Treasury Issue (expressed
as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date.
"Attributable Debt" means, in connection with a Sale
and Lease-Back Transaction, as of any particular time, the
aggregate of present values (discounted at a rate per annum
equal to the interest rate borne by the Securities of the
series created by this Seventh Supplemental Indenture) of the
obligations of the Company or any Restricted Subsidiary for
net rental payments during the remaining primary term of the
applicable lease, calculated in accordance with generally
accepted accounting principles. The term "net rental payments"
under any lease for any period shall mean the sum of the
rental and other payments required to be paid in such period
by the lessee thereunder, not including, however, any amounts
required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and
repairs, reconstruction, insurance, taxes, assessments, water
rates, operating and labor costs or similar charges required
to be paid by such lessee thereunder or any amounts required
to be paid by such lessee thereunder contingent upon the
amount of sales, maintenance and repairs, reconstruction,
insurance, taxes, assessments, water rates or similar charges.
"Business Day" means any day other than a Saturday or
Sunday or a day on which banking institutions in New York City
or Cincinnati, Ohio are authorized or obligated by law or
executive order to close.
"Capital Lease" means any lease of property which, in
accordance with generally accepted accounting principles,
should be capitalized on the lessee's balance sheet or for
which the amount of the asset and liability thereunder as if
so capitalized should be disclosed in a note to such balance
sheet; and "Capitalized Lease Obligation" means the amount of
the liability which should be so capitalized or disclosed.
"Comparable Treasury Issue" means the United States
Treasury security selected by a Quotation Agent as having a
maturity comparable to the remaining term of the Securities to
be redeemed that would be utilized, at the time of selection
and in accordance with customary financial practice, in
pricing new issues
-3-
<PAGE> 4
of corporate debt securities of comparable maturity to the
remaining term of such Securities.
"Comparable Treasury Price" means, with respect to
any Redemption Date, (i) the average of the Reference Treasury
Dealer Quotations, after excluding the highest and lowest such
Reference Treasury Dealer Quotations for such Redemption Date,
or (ii) if the Trustee obtains fewer than three such Reference
Treasury Dealer Quotations, the average of all such
Quotations.
"Consolidated Net Tangible Assets" means, for the
Company and its Subsidiaries on a consolidated basis
determined in accordance with generally accepted accounting
principles, the aggregate amounts of assets (less depreciation
and valuation reserves and other reserves and items deductible
from gross book value of specific asset accounts under
generally accepted accounting principles) which under
generally accepted accounting principles would be included on
a balance sheet after deducting therefrom (a) all liability
items except deferred income taxes, commercial paper,
short-term bank Indebtedness, Funded Indebtedness, other
long-term liabilities and shareholders' equity and (b) all
goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, which in each
case would be so included on such balance sheet.
"Credit Facility" means any credit agreement, loan
agreement or credit facility, whether syndicated or not,
involving the extension of credit by banks or other credit
institutions, entered into by the Company or Fred Meyer, Inc.
and outstanding on the date of this Seventh Supplemental
Indenture, and any refinancing or other restructuring of such
agreement or facility.
"Funded Indebtedness" means any Indebtedness maturing
by its terms more than one year from the date of the
determination thereof, including (i) any Indebtedness having a
maturity of 12 months or less but by its terms renewable or
extendible at the option of the obligor to a date later than
12 months from the date of the determination thereof and (ii)
rental obligations payable more than 12 months from the date
of determination thereof under Capital Leases (such rental
obligations to be included as Funded Indebtedness at the
amount so capitalized at the date of such computation and to
be included for the purposes of the definition of
-4-
<PAGE> 5
Consolidated Net Tangible Assets both as an asset and as
Funded Indebtedness at the amount so capitalized).
"Non-Restricted Subsidiary" means any Subsidiary that
the Company's Board of Directors has in good faith declared
pursuant to a written resolution not to be of material
importance, either singly or together with all other
Non-Restricted Subsidiaries, to the business of the Company
and its consolidated Subsidiaries taken as a whole.
"Operating Assets" means all merchandise inventories,
furniture, fixtures and equipment (including all
transportation and warehousing equipment but excluding office
equipment and data processing equipment) owned or leased
pursuant to Capital Leases by the Company or a Restricted
Subsidiary.
"Operating Property" means all real property and
improvements thereon owned or leased pursuant to Capital
Leases by the Company or a Restricted Subsidiary and
constituting, without limitation, any store, warehouse,
service center or distribution center wherever located,
provided that such term shall not include any store,
warehouse, service center or distribution center which the
Company's Board of Directors declares by written resolution
not to be of material importance to the business of the
Company and its Restricted Subsidiaries.
"Quotation Agent" means the Reference Treasury Dealer
appointed by the Company.
"Reference Treasury Dealer" means (i) Goldman, Sachs
& Co. and its successors; provided, however, that if the
foregoing shall cease to be a primary U.S. Government
securities dealer in New York City (a "Primary Treasury
Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer, and (ii) any other Primary Treasury
Dealer selected by the Company.
"Reference Treasury Dealer Quotations" means, with
respect to each Reference Treasury Dealer and any Redemption
Date, the average, as determined by the Company, of the bid
and asked prices for the Comparable Treasury Issue (expressed
in each case as a percentage of its principal amount) quoted
in writing to the Trustee by such Reference Treasury Dealer at
5:00 p.m. on the third Business Day preceding such Redemption
Date.
-5-
<PAGE> 6
"Restricted Subsidiaries" means all Subsidiaries
other than Non-Restricted Subsidiaries.
"Sale and Lease-Back Transaction" has the meaning
specified in Section 1010.
"Subsidiary" means (i) any corporation or other
entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at
the time directly or indirectly owned by the Company and/or
one or more Subsidiaries or (ii) any partnership of which more
than 50% of the partnership interest is owned by the Company
or any Subsidiary.
ARTICLE TWO
SECURITY FORMS
Section 201. Form of Securities of this Series.
The Securities of this series shall be in the form set forth
in this Article.
Section 202. Form of Face of Security.
This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee of a Depository. This Security is not exchangeable for Securities
registered in the name of a Person other than the Depositary or its nominee
except in the limited circumstances described in the Indenture, and no transfer
of this Security (other than a transfer of this Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
the limited circumstances described in the Indenture.
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to The Kroger Co. or its agent for registration of transfer, exchange, or
payment, and any certificate issued is registered in the name of Cede & Co. or
in such other name as is requested by an authorized representative of DTC (and
any payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
-6-
<PAGE> 7
THE KROGER CO.
8.05% Senior Notes due 2010
No. ......... $ ........
The Kroger Co., a corporation duly organized and existing
under the laws of the State of Ohio (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to .............................., or
registered assigns, the principal sum of .....................................
Dollars on February 1, 2010 and to pay interest thereon from February 11, 2000,
or from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually on February 1 and August 1 in each year,
commencing August 1, 2000 at the rate of interest of 8.05% per annum until the
principal hereof is paid or made available for payment. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the July 15 or
January 15 (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture.
Payment of the principal of (and premium, if any) and interest
on this Security will be made at the office or agency of the Company maintained
for that purpose in Cincinnati, Ohio, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register.
In the case where any Interest Payment Date or the maturity
date of this Security does not fall on a Business Day, payment of interest or
principal otherwise payable on such day need not be made on such day, but may be
made on the next succeeding Business Day with the same form and effect as if
made on such Interest Payment Date or the maturity date of this Security.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
-7-
<PAGE> 8
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
THE KROGER CO.
By.................................
Attest:
................................
This is one of the Securities of the series designated therein
referred to in the within mentioned Indenture.
FIRSTAR BANK, National Association,
as Trustee
By_________________________________
Authorized Officer
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of Securities
of the Company (including the related Guarantees, the "Securities") issued and
to be issued under an Indenture dated as of June 25, 1999, as supplemented by
the First Supplemental Indenture dated as of June 25, 1999, the Second
Supplemental Indenture dated as of June 25, 1999, the Third Supplemental
Indenture dated as of June 25, 1999, the Fourth Supplemental Indenture dated as
of September 22, 1999, the Fifth Supplemental dated as of September 22, 1999,
the Sixth Supplemental Indenture dated as of September 22, 1999, and the Seventh
Supplemental Indenture dated as of February 11, 2000 (as so supplemented, herein
called the "Indenture"), each between the Company and the Guarantors named
therein, and Firstar Bank, National Association, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is
-8-
<PAGE> 9
hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Guarantors named therein,
the Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof, limited in aggregate principal
amount to $500,000,000.
The Securities of this series will be redeemable, in whole or
in part, at the option of the Company at any time at a redemption price equal to
the greater of (i) 100% of the principal amount of such Securities or (ii) as
determined by a Quotation Agent, the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including any portion
of such payments of interest accrued as of the date of redemption) discounted to
the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate plus 10 basis
points, plus, in each case, accrued interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days but
not more than 60 days before the Redemption Date to each holder of the
Securities to be redeemed. Unless the Company defaults in payment of the
redemption price, on and after the Redemption Date, interest will cease to
accrue on the Securities or portions thereof called for redemption.
The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.
If an Event of Default shall occur and be continuing, the
principal of all Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of 50% in aggregate principal amount
of the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all the Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange therefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
As set forth in, and subject to, the provisions of the
Indenture, no Holder of any Security will have any right to institute any
proceeding with respect to the Indenture or for any
-9-
<PAGE> 10
remedy thereunder, unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default, the Holders of not less than
25% in principal amount of the Outstanding Securities shall have made written
request, and offered reasonable indemnity, to the Trustee to institute such
proceeding as trustee, and the Trustee shall not have received from the Holders
of a majority in principal amount of the Outstanding Securities a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days; provided, however, that such limitations do not apply
to a suit instituted by the Holder hereof for the enforcement of payment of the
principal of (and premium, if any) or any interest on this Security on or after
the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Security at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the principal
of and any premium and interest on this Security are payable, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of like tenor, of a different authorized denomination, as requested by the
Holder surrendering the same.
Except where otherwise specifically provided in the Indenture,
no service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
-10-
<PAGE> 11
Section 204. Form of Guarantee.
The form of Guarantee shall be set forth on the Securities
substantially as follows:
GUARANTEE
For value received, each of the undersigned hereby absolutely, fully
and unconditionally and irrevocably guarantees, jointly and severally with each
other Guarantor, to the holder of this Security the payment of principal of,
premium, if any, and interest on this Security upon which this Guarantee is
endorsed in the amounts and at the time when due and payable whether by
declaration thereof, or otherwise, and interest on the overdue principal and
interest, if any, of this Security, if lawful, and the payment or performance of
all other obligations of the Company under the Indenture or the Securities, to
the holder of this Security and the Trustee, all in accordance with and subject
to the terms and limitations of this Security and Article Five of the Seventh
Supplemental Indenture to the Indenture. This Guarantee will not become
effective until the Trustee duly executes the certificate of authentication on
this Security. This Guarantee shall be governed by and construed in accordance
with the laws of the State of New York, without regard to conflict of law
principles thereof.
Dated:
Attest: Each of the Guarantors Listed on
Schedule I hereto, as Guarantor of the
Securities
By:
- ----------------------------- Name:
Assistant Secretary/Secretary Title:
Attest: RJD ASSURANCE, INC.,
as Guarantor of the Securities
VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By:
------------------------------------
Name: Bruce M. Gack
- ----------------------------- Title: Vice President
Assistant Treasurer
-11-
<PAGE> 12
RICHIE'S INC., as Guarantor of the
Securities
By:
------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
ROCKET NEWCO, INC.
as Guarantor of the Securities
HENPIL, INC.,
as Guarantor of the Securities
WYDIV, INC.,
as Guarantor of the Securities
By:
------------------------------------
Name: Steven McMillan
Title: Vice President and Secretary
-12-
<PAGE> 13
This is one of the Guarantees referred to in the within mentioned Indenture.
FIRSTAR BANK, NATIONAL ASSOCIATION
as Trustee
By:
------------------------------------
Name:
Title:
-13-
<PAGE> 14
SCHEDULE I
Guarantors
Name of Guarantor State of Organization
- ----------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
CB&S Advertising Agency, Inc. Oregon
City Market, Inc. Colorado
Compare, Inc. Delaware
Crawford Stores, Inc. California
Dillon Companies, Inc. Kansas
Dillon Real Estate Co., Inc. Kansas
Distribution Trucking Company Oregon
Drugs Distributors, Inc. Indiana
FM Holding Corporation Delaware
FM Retail Services, Inc. Washington
FM, Inc. Utah
Food 4 Less GM, Inc. California
Food 4 Less Holdings, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Fred Meyer, Inc. Delaware
Fred Meyer Jewelers, Inc. Delaware
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Stores, Inc. Delaware
Grand Central, Inc. Utah
Hughes Markets, Inc. California
Hughes Realty, Inc. California
Inter-American Foods, Inc. Ohio
Jackson Ice Cream Co., Inc. Kansas
JH Properties, Inc. Washington
Junior Food Stores of West Florida, Inc. Florida
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
Kroger Dedicated Logistics Co. Ohio
Kroger Limited Partnership I Ohio (limited partnership)
Kroger Limited Partnership II Ohio (limited partnership)
Kroger Texas L.P. Ohio (limited partnership)
KU Acquisition Corporation Washington
-14-
<PAGE> 15
Name of Guarantor State of Organization
- ----------------- ---------------------
Kwik Shop, Inc. Kansas
Merksamer Jewelers, Inc. California
Mini Mart, Inc. Wyoming
Peyton's-Southeastern, Inc. Tennessee
QFC Sub, Inc. Washington
Quality Food Centers, Inc. Washington
Quality Food Holdings, Inc. Delaware
Quality Food, Inc. Delaware
Quik Stop Markets, Inc. California
Ralphs Grocery Company Delaware
Roundup Co. Washington
Saint Lawrence Holding Company Delaware
Second Story, Inc. Washington
Smith's Beverage of Wyoming, Inc. Wyoming
Smith's Food & Drug Centers, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Smitty's Supermarkets, Inc. Delaware
The Kroger Co. of Michigan Michigan
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Topvalco, Inc. Ohio
Treasure Valley Land Company, L.C. Idaho
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Western Property Investment Group, Inc. California
-15-
<PAGE> 16
ARTICLE THREE
THE SERIES OF SECURITIES
Section 301. Title and Terms.
There shall be a series of Securities designated as the "8.05%
Senior Notes due 2010" of the Company. Their Stated Maturity shall be February
1, 2010, and they shall bear interest at the rate of 8.05% per annum.
Interest on the Securities of this series will be payable
semi-annually on August 1 and February 1 of each year, commencing August 1,
2000, until the principal thereof is made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will be paid to the Person in whose name the Securities of this series (or one
or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, which shall be the July 15 or January 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
In the case where any Interest Payment Date or the maturity
date of the Securities of this series does not fall on a Business Day, payment
of interest or principal otherwise payable on such date need not be made on such
day, but may be made on the next succeeding Business Day with the same force and
effect as if made on such Interest Payment Date or the maturity date of the
Securities of this series.
The aggregate principal amount of Securities of this series
which may be authenticated and delivered under this Seventh Supplemental
Indenture is limited to $500,000,000, except for Securities authenticated and
delivered upon registration or transfer of, or in exchange for, or in lieu of,
other Securities of this series pursuant to Section 304, 305 and 306 of the
Indenture and except for any Securities of this series which, pursuant to
Section 303 of the Indenture, are deemed never to have been authenticated and
delivered under the Indenture.
The Securities of this series will be represented by one or
more Global Securities representing the entire $500,000,000 aggregate principal
amount of the Securities of this series, and the Depositary with respect to such
Global Security or Global Securities will be The Depository Trust Company.
The Place of Payment for the principal of (and premium, if
any) and interest on the Securities of this series shall be the office or agency
of the Company in the City of Cincinnati, State of Ohio, maintained for such
purpose, which shall be the Corporate Trust Office of the Trustee and at any
other office or agency maintained by the Company for such purpose; provided,
however, that at the option of the Company payment of interest may be
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made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register.
The Securities of this series are redeemable prior to maturity
at the option of the Company as provided in this Seventh Supplemental Indenture.
The Securities of this series are not subject to a sinking
fund and the provisions of Section 501(3) and Article Twelve of the Indenture
shall not be applicable to the Securities of this series.
The Securities of this series are subject to defeasance at the
option of the Company as provided in this Seventh Supplemental Indenture.
ARTICLE FOUR
MODIFICATIONS AND ADDITIONS TO THE INDENTURE
Section 401. Modifications to the Consolidation, Merger, Conveyance, Transfer or
Lease Provisions.
With respect to the Securities of this series, Section 801 of
the Indenture shall be deleted in its entirety and the following shall be
substituted therefor:
"Section 801. Covenant Not to Merge, Consolidate, Sell or
Convey Property Except Under Certain Conditions.
The Company covenants that it will not merge with or
into or consolidate with any corporation, partnership, or other entity or sell,
lease or convey all or substantially all of its assets to any other Person,
unless (i) either the Company shall be the continuing corporation, or the
successor entity or the Person which acquires by sale, lease or conveyance all
or substantially all the assets of the Company (if other than the Company) shall
be a corporation or partnership organized under the laws of the United States of
America or any State thereof or the District of Columbia and shall expressly
assume all obligations of the Company under this Indenture and the Securities of
the series created by the Seventh Supplemental Indenture, including the due and
punctual payment of the principal of and interest on all the Securities of the
series created by the Seventh Supplemental Indenture according to their tenor,
and the due and punctual performance and observance of all of the covenants and
conditions of the Indenture to be performed or observed by the Company, by
supplemental indenture in form satisfactory to the Trustee, executed and
delivered to the Trustee by such entity, and (ii) the Company, such person or
such successor entity, as the case may be, shall not, immediately after such
merger or consolidation, or such sale, lease or conveyance, be in default in the
performance of any such covenant or condition and, immediately
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after giving effect to such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of Default,
shall have happened and be continuing.
Section 802. Successor Substituted
Upon any consolidation of the Company with, or merger
of the Company into, any other Person or any sale, lease or conveyance of all or
substantially all of the assets of the Company in accordance with Section 801,
the successor Person formed by such consolidation or into which the Company is
merged or to which such sale, lease or conveyance is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under this
Indenture and the Securities."
Section 402. Other Modifications.
With respect to the Securities of this series, the Indenture
shall be modified as follows:
(a) The eighth paragraph of Section 305 of the Indenture shall
be modified by inserting ", and a successor Depositary is not appointed by the
Company within 90 days" at the end of clause (i) in such paragraph; and
(b) Section 401 of the Indenture shall be modified by adding
to the end of such Section the following paragraph:
"For the purpose of this Section 401, trust funds may consist
of (A) money in an amount, or (B) U.S. Government Obligations (as defined in
Section 1304) which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than one
day before the due date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, the principal of, premium, if
any, and each installment of interest on the Securities of this series on the
Stated Maturity of such principal or installment of interest on the day on which
such payments are due and payable in accordance with the terms of this Indenture
and of such Securities of this series."
Section 403. Additional Covenants; Defeasance and Covenant Defeasance.
(a) With respect to the Securities of this series, the
following provisions shall be added as Sections 1009 and 1010 and as Article
Thirteen (Section references contained in these
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additional provisions are to the Indenture as supplemented by this Seventh
Supplemental Indenture):
"Section 1009. Limitations on Liens.
After the date hereof and so long as any Securities
of the series created by the Seventh Supplemental Indenture are Outstanding, the
Company will not issue, assume or guarantee, and will not permit any Restricted
Subsidiary to issue, assume or guarantee, any Indebtedness which is secured by a
mortgage, pledge, security interest, lien or encumbrance of any kind (including
any conditional sale or other title retention agreement, any lease in the nature
thereof, and any agreement to give any of the foregoing) (each being hereinafter
referred to as a "lien" or "liens") of or upon any Operating Property or
Operating Asset, whether now owned or hereafter acquired, of the Company or any
Restricted Subsidiary without effectively providing that the Securities of the
series created by the Seventh Supplemental Indenture (together with, if the
Company shall so determine, any other Indebtedness of the Company ranking
equally with the Securities) shall be equally and ratably secured by a lien on
such assets ranking ratably with and equal to (or at the Company's option prior
to) such secured Indebtedness; provided that the foregoing restriction shall not
apply to:
(a) liens on any property or assets of any
corporation existing at the time such corporation becomes a Restricted
Subsidiary provided that such lien does not extend to any other property of the
Company or any of its Restricted Subsidiaries;
(b) liens on any property or assets (including stock)
existing at the time of acquisition of such property or assets by the Company or
a Restricted Subsidiary, or liens to secure the payment of all or any part of
the purchase price of such property or assets (including stock) upon the
acquisition of such property or assets by the Company or a Restricted Subsidiary
or to secure any indebtedness incurred, assumed or guaranteed by the Company or
a Restricted Subsidiary for the purpose of financing all or any part of the
purchase price of such property or, in the case of real property, construction
or improvements thereon or attaching to property substituted by the Company to
obtain the release of a lien on other property of the Company on which a lien
then exists, which indebtedness is incurred, assumed or guaranteed prior to, at
the time of, or within 18 months after such acquisition (or in the case of real
property, the completion of construction (including any improvements on an
existing asset) or commencement of full operation at such property, whichever is
later (which in the case of a retail store is the opening of the store for
business to the public)); provided that in the case of any such acquisition,
construction or improvement, the lien shall not apply to any other property or
assets theretofore owned by the Company or a Restricted Subsidiary;
(c) liens on any property or assets to secure
Indebtedness of a Restricted Subsidiary to the Company or to another Restricted
Subsidiary;
(d) liens on any property or assets of a corporation
existing at the time such corporation is merged into or consolidated with the
Company or a Restricted Subsidiary or at
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the time of a purchase, lease or other acquisition of the assets of a
corporation or firm as an entirety or substantially as an entirety by the
Company or a Restricted Subsidiary provided that such lien does not extend to
any other property of the Company or any of its Restricted Subsidiaries;
(e) liens on any property or assets of the Company or
a Restricted Subsidiary in favor of the United States of America or any State
thereof, or any department, agency or instrumentality or political subdivision
of the United States of America or any State thereof, or in favor of any other
country, or any political subdivision thereof, to secure partial, progress,
advance or other payments pursuant to any contract or statute or to secure any
Indebtedness incurred or guaranteed for the purpose of financing all or any part
of the purchase price (or, in the case of real property, the cost of
construction) of the property or assets subject to such liens (including, but
not limited to, liens incurred in connection with pollution control, industrial
revenue or similar financings);
(f) liens existing on properties or assets of the
Company or any Restricted Subsidiary existing on the date hereof; provided that
such liens secure only those obligations which they secure on the date hereof or
any extension, renewal or replacement thereof;
(g) any extension, renewal or replacement (or
successive extensions, renewals or replacements) in whole or in part, of any
lien referred to in the foregoing clauses (a) through (f), inclusive; provided
that such extension, renewal or replacement shall be limited to all or a part of
the property or assets which secured the lien so extended, renewed or replaced
(plus improvements and construction on real property);
(h) liens imposed by law, such as mechanics',
workmen's, repairmen's, materialmen's, carriers', warehouseman's, vendors', or
other similar liens arising in the ordinary course of business of the Company or
a Restricted Subsidiary, or governmental (federal, state or municipal) liens
arising out of contracts for the sale of products or services by the Company or
any Restricted Subsidiary, or deposits or pledges to obtain the release of any
of the foregoing liens;
(i) pledges, liens or deposits under worker's
compensation laws or similar legislation and liens or judgments thereunder which
are not currently dischargeable, or in connection with bids, tenders, contracts
(other than for the payment of money) or leases to which the Company or any
Restricted Subsidiary is a party, or to secure the public or statutory
obligations of the Company or any Restricted Subsidiary, or in connection with
obtaining or maintaining self-insurance or to obtain the benefits of any law,
regulation or arrangement pertaining to unemployment insurance, old age
pensions, social security or similar matters, or to secure surety, appeal or
customs bonds to which the Company or any Restricted Subsidiary is a party, or
in litigation or other proceedings such as, but not limited to, interpleader
proceedings, and other similar pledges, liens or deposits made or incurred in
the ordinary course of business;
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<PAGE> 21
(j) liens created by or resulting from any litigation
or other proceeding which is being contested in good faith by appropriate
proceedings, including liens arising out of judgments or awards against the
Company or any Restricted Subsidiary with respect to which the Company or such
Restricted Subsidiary is in good faith prosecuting an appeal or proceedings for
review or for which the time to make an appeal has not yet expired; or final
unappealable judgment liens which are satisfied within 30 days of the date of
judgment; or liens incurred by the Company or any Restricted Subsidiary for the
purpose of obtaining a stay or discharge in the course of any litigation or
other proceeding to which the Company or such Restricted Subsidiary is a party;
(k) liens for taxes or assessments or governmental
charges or levies not yet due or delinquent, or which can thereafter be paid
without penalty, or which are being contested in good faith by appropriate
proceedings; landlord's liens on property held under lease; and any other liens
or charges incidental to the conduct of the business of the Company or any
Restricted Subsidiary or the ownership of the property or assets of any of them
which were not incurred in connection with the borrowing of money or the
obtaining of advances or credit and which do not, in the opinion of the Company,
materially impair the use of such property or assets in the operation of the
business of the Company or such Restricted Subsidiary or the value of such
property or assets for the purposes of such business; or
(l) liens not permitted by clauses (a) through (k)
above if at the time of, and after giving effect to, the creation or assumption
of any such lien, the aggregate amount of all Indebtedness of the Company and
its Restricted Subsidiaries secured by all such liens not so permitted by
clauses (a) through (k) above together with the Attributable Debt in respect of
Sale and Lease-Back Transactions permitted by paragraph (a) of Section 1010 does
not exceed 10% of Consolidated Net Tangible Assets.
Section 1010. Limitations on Sale and Lease-Back Transactions.
After the date hereof and so long as any Securities of the
series created by the Seventh Supplemental Indenture are Outstanding, the
Company agrees that it will not, and will not permit any Restricted Subsidiary
to, enter into any arrangement with any Person providing for the leasing by the
Company or a Restricted Subsidiary of any Operating Property or Operating Asset
(other than any such arrangement involving a lease for a term, including renewal
rights, for not more than 3 years and leases between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries), whereby such
Operating Property or Operating Asset has been or is to be sold or transferred
by the Company or any Restricted Subsidiary to such Person (herein referred to
as a "Sale and Lease-Back Transaction"), unless:
(a) the Company or such Restricted Subsidiary would,
at the time of entering into a Sale and Lease-Back transaction, be entitled to
incur Indebtedness secured by a lien on the Operating Property or Operating
Asset to be leased in an amount at least equal to the Attributable Debt in
respect of such Sale and Lease-Back Transaction without equally and
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ratably securing the Securities of the series created by the Seventh
Supplemental Indenture pursuant to Section 1009; or
(b) the proceeds of the sale of the Operating
Property or Operating Asset to be leased are at least equal to the fair market
value of such Operating Property or Operating Asset (as determined by the chief
financial officer or chief accounting officer of the Company) and an amount in
cash equal to the net proceeds from the sale of the Operating Property or
Operating Asset so leased is applied, within 180 days of the effective date of
any such Sale and Lease-Back Transaction, to the purchase or acquisition (or, in
the case of Operating Property, the construction) of Operating Property or
Operating Assets or to the retirement, repurchase, redemption or repayment
(other than at maturity or pursuant to a mandatory sinking fund or redemption
provision and other than Indebtedness owned by the Company or any Restricted
Subsidiary) of Securities of the series created by the Seventh Supplemental
Indenture or of Funded Indebtedness of the Company ranking on a parity with or
senior to the Securities of the series created by the Seventh Supplemental
Indenture, or in the case of a Sale and Lease-Back Transaction by a Restricted
Subsidiary, of Funded Indebtedness of such Restricted Subsidiary; provided that
in connection with any such retirement, any related loan commitment or the like
shall be reduced in an amount equal to the principal amount so retired.
The foregoing restriction shall not apply to, in the case of
any Operating Property or Operating Asset acquired or constructed subsequent to
the date eighteen months prior to the date of this Indenture, any Sale and
Lease-Back Transaction with respect to such Operating Asset or Operating
Property (including presently owned real property upon which such Operating
Property is to be constructed) if a binding commitment is entered into with
respect to such Sale and Lease-Back Transaction within 18 months after the later
of the acquisition of the Operating Property or Operating Asset or the
completion of improvements or construction thereon or commencement of full
operations at such Operating Property (which in the case of a retail store is
the opening of the store for business to the public).
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance.
The Company may at its option by Board Resolution, at any
time, elect to have either Section 1302 or Section 1303 applied to the
Outstanding Securities of this series upon compliance with the
conditions set forth below in this Article Thirteen.
Section 1302. Defeasance and Discharge.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be deemed to have
been discharged from its obligations with respect to the Outstanding
Securities of the series created by the
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Seventh Supplemental Indenture on the date the conditions set forth
below are satisfied (hereinafter, "Defeasance"). For this purpose, such
Defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by the Outstanding
Securities of this series and to have satisfied all its other
obligations under such Securities of this series and this Indenture
insofar as such Securities of this series are concerned (and the
Trustee, at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following which
shall survive until otherwise terminated or discharged hereunder: (A)
the rights of Holders of Outstanding Securities of this series to
receive, solely from the trust fund described in Section 1304 and as
more fully set forth in such Section, payments in respect of the
principal of (and premium, if any) and interest on such securities when
such payments are due, (B) the Company's obligations with respect to
such Securities of this series under Sections 304, 305, 306, 1002 and
1003, (C) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and (D) this Article Thirteen. Subject to compliance
with this Article Thirteen, the Company may exercise its option under
this Section 1302 notwithstanding the prior exercise of its option
under Section 1303.
Section 1303. Covenant Defeasance.
Upon the Company's exercise of the option provided in Section
1301 applicable to this Section, the Company shall be released from its
obligations under Section 501(4) (in respect of the covenants in
Sections 1008 through 1010), Section 801 and Sections 1008 through
1010, the Securities of this series and the Holders of Securities of
this series, on and after the date the conditions set forth below are
satisfied (hereinafter, "covenant Defeasance"). For this purpose, such
covenant Defeasance means that the Company may omit to comply with and
shall have no liability in respect of any term, condition or limitation
set forth in any such Section, whether directly or indirectly, by
reason of any reference elsewhere herein to any such Section or by
reason of any reference in any such Section to any other provision
herein or in any other document, but the remainder of this Indenture
and such Securities of this series shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 1302 or Section 1303 to the Outstanding Securities of this
series:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 609 who shall agree to
comply with the provisions of this Article Thirteen applicable
to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such
Securities of this series, (A)
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money in an amount, or (B) U.S. Government Obligations which
through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide,
not later than one day before the due date of any payment,
money in an amount, or (C) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, the principal of, premium, if
any, and each installment of interest on the Securities of
this series on the Stated Maturity of such principal or
installment of interest on the day on which such payments are
due and payable in accordance with the terms of this Indenture
and of such Securities of this series. For this purpose, "U.S.
Government Obligations" means securities that are (x) direct
obligations of the United States of America for the payment of
which its full faith and credit is pledged or (y) obligations
of a Person controlled or supervised by and acting as an
agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which,
in either case, are not callable or redeemable at the option
of the Company thereof, and shall also include a depository
receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act of 1933, as amended) as custodian with respect
to any such U.S. Government Obligation or a specific payment
of principal of or interest on any such U.S. Government
Obligation held by such custodian for the account of the
holder of such depository receipt, provided that (except as
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such
depositary receipt from any amount received by the custodian
in respect of the U.S. Government Obligation or the specific
payment of principal of or interest on the U.S. Government
Obligation evidenced by such depositary receipt.
(2) No Event of Default or event which with notice or
lapse of time or both would become an Event of Default shall
have occurred and be continuing on the date of such deposit
or, insofar as subsections 501(6) and (7) are concerned, at
any time during the period ending on the 121st day after the
date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such
period).
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(3) Such Defeasance or covenant Defeasance shall not
cause the Trustee to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with
respect to any securities of the Company.
(4) Such Defeasance or covenant Defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound.
(5) The Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to
either the Defeasance under Section 1302 or the covenant
Defeasance under Section 1303 (as the case may be) have been
complied with.
(6) In the case of an election under Section 1302,
the Company shall have delivered to the Trustee an Opinion of
Counsel stating that (x) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling, or (y) since the date of this Seventh Supplemental
Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that and based
thereon such opinion shall confirm that, the Holders of the
Outstanding Securities of this series will not recognize
income, gain or loss for Federal income tax purposes as a
result of such Defeasance or covenant Defeasance and will be
subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if
such Defeasance or covenant Defeasance had not occurred."
Section 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee
collectively, for purposes of this Section 1305, the "Trustee")
pursuant to Section 1304 in respect of the Securities of this series
shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities of this series and this Indenture, to
the payment, either directly or through any Paying Agent (including the
Company acting as its own Paying Agent) as the Trustee may determine,
to the Holders of such Securities of this series, of all sums due and
to become due thereon in respect of principal (and premium, if any) and
interest, but such money need not be segregated from other funds except
to the extent required by law.
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<PAGE> 26
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 1304 or the
principal and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders
of the Outstanding Securities of this series.
Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from
time to time upon Company Request any money or U.S. Government
Obligations held by it as provided in Section 1304 which, in the
opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent Defeasance or covenant
Defeasance.
Section 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 1302 or 1303 by reason of any order or
judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Securities of this series
shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Thirteen until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with
Section 1302 or 1303; provided, however, that if the Company makes any
payment of principal of (and premium, if any) or interest on any
Security of this series following the reinstatement of its obligations,
the Company shall be subjugated to the rights of the Holders of such
Securities of this series to receive such payment from the money held
by the Trustee or the Paying Agent.
Section 404. Redemption of Securities.
With respect to Securities of this series, Section 1101 of the
Indenture shall be deleted in its entirety and the following shall be
substituted therefor:
"Section 1101. Optional Redemption.
The Securities will be redeemable, in whole or in part, at the
option of the Company at any time at a redemption price equal
to the greater of (i) 100% of the principal amount of such
Securities or (ii) as determined by a Quotation Agent, the sum
of the present values of the remaining scheduled payments of
principal and interest thereon (not including any portion of
such payments of interest accrued as of the date of
redemption) discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate plus 10
basis points plus, in each case, accrued interest thereon to
the date of redemption."
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<PAGE> 27
ARTICLE FIVE
GUARANTEE
Section 501. Guarantee.
Each Guarantor hereby jointly and severally fully and
unconditionally guarantees (each a "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of the Indenture or
the Securities or the obligations of the Company or any other Guarantor to the
Holders or the Trustee hereunder or thereunder, that (a) the principal of,
premium, if any, and interest on the Securities will be duly and punctually paid
in full when due, whether at maturity, upon redemption, by acceleration or
otherwise, and interest on the overdue principal and (to the extent permitted by
law) interest, if any, on the Securities and all other obligations of the
Company or the Guarantor to the Holders of or the Trustee under the Indenture or
the Securities hereunder (including fees, expenses or others) (collectively, the
"Obligations") will be promptly paid in full or performed, all in accordance
with the terms of the Indenture and the Securities; and (b) in case of any
extension of time of payment or renewal of any Obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at Stated Maturity, by acceleration or otherwise.
If the Company shall fail to pay when due, or to perform, any Obligations, for
whatever reason, each Guarantor shall be obligated to pay, or to perform or
cause the performance of, the same immediately. An Event of Default under the
Indenture or the Securities shall constitute an event of default under this
Guarantee, and shall entitle the Holders of Securities to accelerate the
Obligations of the Guarantor hereunder in the same manner and to the same extent
as the Obligations of the Company.
Each Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions of the Indenture or the Securities, any release of any
other Guarantor, the recovery of any judgment against the Company, any action to
enforce the same, whether or not a Guarantee is affixed to any particular
Security, or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a Guarantor.
Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a) the
maturity of the Obligations may be accelerated as provided in Article Five of
the Indenture for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Obligations, and (b) in the event of any acceleration of such Obligations as
provided in Article Five of the Indenture, such Obligations (whether or not due
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and payable) shall forthwith become due and payable by the Guarantor for the
purposes of its Guarantee.
Section 502. Waiver of Demand.
To the fullest extent permitted by applicable law, each of the
Guarantors waives presentment to, demand of payment from and protest of any of
the Obligations, and also waives notice of acceptance of its Guarantee and
notice of protest for nonpayment.
Section 503. Guarantee of Payment.
Each of the Guarantors further agrees that its Guarantee
constitutes a guarantee of payment when due and not of collection, and waives
any right to require that any resort be had by the Trustee or any Holder of the
Securities to the security, if any, held for payment of the Obligations.
Section 504. No Discharge or Diminishment of Guarantee.
Subject to Section 510 of this Seventh Supplemental Indenture,
the obligations of each of the Guarantors hereunder shall not be subject to any
reduction, limitation, impairment or for any reason (other than the indefeasible
payment in full in cash of the Obligations), including any claim of waiver,
release, surrender, alteration or compromise of any of the Obligations, and
shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each of the Guarantors hereunder
shall not be discharged or impaired or otherwise affected by the failure of the
Trustee or any Holder of the Securities to assert any claim or demand or to
enforce any remedy under the Indenture or the Securities, any other guarantee or
any other agreement, by any waiver or modification of any provision of any
thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or omission that may or
might in any manner or to any extent vary the risk of any Guarantor or that
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the indefeasible payment in full in cash of all the
Obligations).
Section 505. Defenses of Company Waived.
To the extent permitted by applicable law, each of the
Guarantors waives any defense based on or arising out of any defense of the
Company or any other Guarantor or the unenforceability of the Obligations or any
part thereof from any cause, or the cessation from any cause of the liability of
the Company, other than final and indefeasible payment in full in cash of the
Obligations. Each of the Guarantors waives any defense arising out of any such
election even though such election operates to impair or to extinguish any right
of reimbursement or subrogation or other right or remedy of each of the
Guarantors against the Company or any security.
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Section 506. Continued Effectiveness.
Subject to Section 510 of this Seventh Supplemental Indenture,
each of the Guarantors further agrees that its Guarantee hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Obligation is
rescinded or must otherwise be restored by the Trustee or any Holder of the
Securities upon the bankruptcy or reorganization of the Company.
Section 507. Subrogation.
In furtherance of the foregoing and not in limitation of any
other right of each of the Guarantors by virtue hereof, upon the failure of the
Company to pay any Obligation when and as the same shall become due, whether at
maturity, by acceleration, after notice of prepayment or otherwise, each of the
Guarantors hereby promises to and will, upon receipt of written demand by the
Trustee or any Holder of the Securities, forthwith pay, or cause to be paid, to
the Holders in cash the amount of such unpaid Obligations, and thereupon the
Holders shall, assign (except to the extent that such assignment would render a
Guarantor a "creditor" of the Company within the meaning of Section 547 of Title
11 of the United States Code as now in effect or hereafter amended or any
comparable provision of any successor statute) the amount of the Obligations
owed to it and paid by such Guarantor pursuant to this Guarantee to such
Guarantor, such assignment to be pro rata to the extent the Obligations in
question were discharged by such Guarantor, or make such other disposition
thereof as such Guarantor shall direct (all without recourse to the Holders, and
without any representation or warranty by the Holders). If (a) a Guarantor shall
make payment to the Holders of all or any part of the Obligations and (b) all
the Obligations and all other amounts payable under this Seventh Supplemental
Indenture shall be indefeasibly paid in full, the Trustee will, at such
Guarantor's request, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary to
evidence the transfer by subrogation to such Guarantor of an interest in the
Obligations resulting from such payment by such Guarantor.
Section 508. Information.
Each of the Guarantors assumes all responsibility for being
and keeping itself informed of the Company's financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks that each of the
Guarantors assumes and incurs hereunder, and agrees that the Trustee and the
Holders of the Securities will have no duty to advise the Guarantors of
information known to it or any of them regarding such circumstances or risks.
Section 509. Subordination.
Upon payment by any Guarantor of any sums to the Holders, as
provided above, all rights of such Guarantor against the Company, arising as a
result thereof by way of right of subrogation or otherwise, shall in all
respects be subordinated and junior in right of payment to
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the prior indefeasible payment in full in cash of all the Obligations to the
Trustee; provided, however, that any right of subrogation that such Guarantor
may have pursuant to this Seventh Supplemental Indenture is subject to Section
507 hereof.
Section 510. Termination.
A Guarantor shall, upon the occurrence of either of the
following events, be automatically and unconditionally released and discharged
from all obligations under this Seventh Supplemental Indenture and its Guarantee
without any action required on the part of the Trustee or any Holder if such
release and discharge will not result in any downgrade in the rating given to
the Securities by Moody's Investors Service and Standard and Poor's Rating
Services:
(a) upon any sale, exchange, transfer or other disposition (by
merger or otherwise) of all of the Capital Stock of a Guarantor or all, or
substantially all, of the assets of such Guarantor, which sale or other
disposition is otherwise in compliance with the terms of the Indenture;
provided, however, that such Guarantor shall not be released and discharged from
its obligations under this Seventh Supplemental Indenture and its Guarantee if,
upon consummation of such sale, exchange, transfer or other disposition (by
merger or otherwise), such Guarantor remains or becomes a Guarantor under any
Credit Facility; or
(b) at the request of the Company, at any time that none of
the Credit Facilities are guaranteed by any Subsidiary of the Company.
The Trustee shall deliver an appropriate instrument evidencing such release upon
receipt of a request of the Company accompanied by an Officers' Certificate
certifying as to the compliance with this Section. Any Guarantor not so released
will remain liable for the full amount of the principal of, premium, if any, and
interest on the Notes provided in this Seventh Supplemental Indenture and its
Guarantee.
Section 511. Guarantees of other Indebtedness.
As long as the Securities are guaranteed by the Guarantors,
the Company will cause each of its Subsidiaries that becomes a Guarantor in
respect of (i) any Indebtedness of the Company which is outstanding on the date
hereof and (ii) any Indebtedness incurred by the Company after the date hereof
(other than in respect of asset-backed securities), to include in any guarantee
given by any such Guarantor, provisions similar to those set forth in Section
510 hereof.
Section 512. Additional Guarantors.
The Company will cause each of its Subsidiaries that becomes a
Guarantor in respect of any Indebtedness of the Company following the date
hereof to execute and deliver a
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supplemental indenture pursuant to which it will become a Guarantor under this
Seventh Supplemental Indenture, if it has not already done so or unless the
Guarantor is prohibited from doing so by applicable law or a provision of a
contract to which it is a party or by which it is bound.
Section 513. Limitation of Guarantor's Liability.
Each Guarantor, and by its acceptance hereof each Holder,
hereby confirms that it is the intention of all such parties that the Guarantee
by such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Title 11 of the United States Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal of
state law. To effectuate the foregoing intention, the Holders and such Guarantor
hereby irrevocably agree that the obligations of such Guarantor under this
Seventh Supplemental Indenture and its Guarantee shall be limited to the maximum
amount which, after giving effect to all other contingent and fixed liabilities
of such Guarantor, and after giving effect to any collections from or payments
made by or on behalf of, any other Guarantor in respect of the obligations of
such Guarantor under its Guarantee or pursuant to its contribution obligations
under this Seventh Supplemental Indenture, will result in the obligations of
such Guarantor under its Guarantee not constituting such fraudulent transfer or
conveyance.
Section 514. Contribution from Other Guarantors.
Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor in a pro
rata amount based on the net assets of each Guarantor, determined in accordance
with generally accepted accounting principles in effect in the United States of
America as of the date hereof.
Section 515. No Obligation to Take Action Against the Company.
Neither the Trustee, any Holder nor any other Person shall
have any obligation to enforce or exhaust any rights or remedies or take any
other steps under any security for the Obligations or against the Company or any
other Person or any property of the Company or any other Person before the
Trustee, such Holder or such other Person is entitled to demand payment and
performance by any or all Guarantors of their liabilities and obligations under
their Guarantee.
Section 516. Dealing with the Company and Others.
The Holders, without releasing, discharging, limiting or
otherwise affecting in whole or in part the obligations and liabilities of any
Guarantor hereunder and without the consent of or notice to any Guarantor, may:
(a) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the Company
or any other Person;
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(b) take or abstain from taking security or collateral from
the Company or from perfecting security or collateral from the Company;
(c) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or without
consideration) any and all collateral, mortgages or other security given by the
Company or any third party with respect to the Obligations;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or
from any security to such part of the Obligations as the Holders may see fit or
change any such application in whole or in part from time to time as the Holders
may see fit; and
(f) otherwise deal with, or waive or modify their right to
deal with, the Company and all other Persons and any security as the Holders or
the Trustee may see fit.
Section 517. Execution and Delivery of the Guarantee.
(a) To further evidence the Guarantee set forth in this
Article Five, each Guarantor hereby agrees that a notation of such Guarantee
shall be endorsed on each Security authenticated and delivered by the Trustee
and executed by either manual or facsimile signature of an officer of each
Guarantor. The corporate seal of a Guarantor may be reproduced on the executed
Guarantee and the execution thereof may be attested to by any appropriate
officer of the Guarantor, but neither such reproduction nor such attestation is
or shall be required.
(b) Each of the Guarantors hereby agrees that its Guarantee
set forth in this Article Five shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such
Guarantee.
(c) If an officer of a Guarantor whose signature is on this
Seventh Supplemental Indenture or a Guarantee no longer holds that office at the
time the Trustee authenticates such Guarantee or at any time thereafter, such
Guarantor's Guarantee of such Security shall be valid nevertheless.
(d) The delivery of any Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of any Guarantee
set forth in this Seventh Supplemental Indenture on behalf of each Guarantor.
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ARTICLE SIX
MISCELLANEOUS
Section 601. Miscellaneous.
(a) The Trustee accepts the trusts created by the Indenture,
as supplemented by this Seventh Supplemental Indenture, and agrees to perform
the same upon the terms and conditions of the Indenture, as supplemented by this
Seventh Supplemental Indenture.
(b) The recitals contained herein shall be taken as statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Seventh Supplemental Indenture.
(c) All capitalized terms used and not defined herein shall
have the respective meanings assigned to them in the Indenture.
(d) Each of the Company and the Trustee makes and reaffirms as
of the date of execution of this Seventh Supplemental Indenture all of its
respective representations, covenants and agreements set forth in the Indenture.
(e) All covenants and agreements in this Seventh Supplemental
Indenture by the Company or the Trustee and each Guarantor shall bind its
respective successors and assigns, whether so expressed or not.
(f) In case any provisions in this Seventh Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
(g) Nothing in this Seventh Supplemental Indenture, express or
implied, shall give to any Person, other than the parties hereto and their
successors under the Indenture and the Holders of the series of Securities
created hereby, any benefit or any legal or equitable right, remedy or claim
under the Indenture.
(h) If any provision hereof limits, qualifies or conflicts
with a provision of the Trust Indenture Act of 1939, as may be amended from time
to time, that is required under such Act to be a part of and govern this Seventh
Supplemental Indenture, the latter provision shall control. If any provision
hereof modifies or excludes any provision of such Act that may be so modified or
excluded, the latter provision shall be deemed to apply to this Seventh
Supplemental Indenture as so modified or excluded, as the case may be.
(i) This Seventh Supplemental Indenture shall be governed by
and construed in accordance with the laws of the State of New York.
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(j) All amendments to the Indenture made hereby shall have
effect only with respect to the series of Securities created hereby.
(k) All provisions of this Seventh Supplemental Indenture
shall be deemed to be incorporated in, and made a part of, the Indenture; and
the Indenture, as supplemented by this Seventh Supplemental Indenture, shall be
read, taken and construed as one and the same instrument.
This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
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<PAGE> 35
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
Attest: THE KROGER CO.
Each of the Guarantors Listed on
Schedule I hereto, as Guarantor of the
Securities
By:
- ----------------------------- ------------------------------------
Assistant Secretary/Secretary Name: Lawrence M. Turner
Title: Vice President and Treasurer
Attest: RJD ASSURANCE, INC.,
as Guarantor of the Securities
VINE COURT ASSURANCE INCORPORATED,
as Guarantor of the Securities
By:
------------------------------------
Name: Bruce M. Gack
- ----------------------------- Title: Vice President
Assistant Treasurer
RICHIE'S INC., as Guarantor of the
Securities
By:
------------------------------------
Name: Keith C. Larson
Title: Vice President and Secretary
ROCKET NEWCO, INC.
as Guarantor of the Securities
HENPIL, INC.,
as Guarantor of the Securities
WYDIV, INC.,
as Guarantor of the Securities
By:
------------------------------------
Name: Steven McMillan
Title: Vice President and Secretary
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<PAGE> 36
Attest: FIRSTAR BANK, NATIONAL ASSOCIATION,
as Trustee
By:
Name:
- -------------------------- Title :
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<PAGE> 37
SCHEDULE I
Guarantors
Name of Guarantor State of Organization
- ----------------- ---------------------
Alpha Beta Company California
Bay Area Warehouse Stores, Inc. California
Bell Markets, Inc. California
Cala Co. Delaware
Cala Foods, Inc. California
CB&S Advertising Agency, Inc. Oregon
City Market, Inc. Colorado
Compare, Inc. Delaware
Crawford Stores, Inc. California
Dillon Companies, Inc. Kansas
Dillon Real Estate Co., Inc. Kansas
Distribution Trucking Company Oregon
Drugs Distributors, Inc. Indiana
FM Holding Corporation Delaware
FM Retail Services, Inc. Washington
FM, Inc. Utah
Food 4 Less GM, Inc. California
Food 4 Less Holdings, Inc. Delaware
Food 4 Less Merchandising, Inc. California
Food 4 Less of California, Inc. California
Food 4 Less of Southern California, Inc. Delaware
Fred Meyer, Inc. Delaware
Fred Meyer Jewelers, Inc. Delaware
Fred Meyer of Alaska, Inc. Alaska
Fred Meyer of California, Inc. California
Fred Meyer Stores, Inc. Delaware
Grand Central, Inc. Utah
Hughes Markets, Inc. California
Hughes Realty, Inc. California
Inter-American Foods, Inc. Ohio
Jackson Ice Cream Co., Inc. Kansas
JH Properties, Inc. Washington
Junior Food Stores of West Florida, Inc. Florida
J.V. Distributing, Inc. Michigan
KRGP Inc. Ohio
KRLP Inc. Ohio
Kroger Dedicated Logistics Co. Ohio
Kroger Limited Partnership I Ohio (limited partnership)
Kroger Limited Partnership II Ohio (limited partnership)
Kroger Texas L.P. Ohio
KU Acquisition Corporation Washington
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Name of Guarantor State of Organization
- ----------------- ---------------------
Kwik Shop, Inc. Kansas
Merksamer Jewelers, Inc. California
Mini Mart, Inc. Wyoming
Peyton's-Southeastern, Inc. Tennessee
QFC Sub, Inc. Washington
Quality Food Centers, Inc. Washington
Quality Food Holdings, Inc. Delaware
Quality Food, Inc. Delaware
Quik Stop Markets, Inc. California
Ralphs Grocery Company Delaware
Roundup Co. Washington
Saint Lawrence Holding Company Delaware
Second Story, Inc. Washington
Smith's Beverage of Wyoming, Inc. Wyoming
Smith's Food & Drug Centers, Inc. Delaware
Smitty's Equipment Leasing, Inc. Delaware
Smitty's Super Valu, Inc. Delaware
Smitty's Supermarkets, Inc. Delaware
The Kroger Co. of Michigan Michigan
THGP Co., Inc. Pennsylvania
THLP Co., Inc. Pennsylvania
Topvalco, Inc. Ohio
Treasure Valley Land Company, L.C. Idaho
Turkey Hill, L.P. Pennsylvania (limited
partnership)
Wells Aircraft, Inc. Kansas
Western Property Investment Group, Inc. California
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<PAGE> 39
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the day of February, 2000, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is __________________ of The Kroger Co., and ____________________ of
each of the Guarantors Listed on Schedule I hereto, corporations described in
and which executed the foregoing instrument; that he knows the seals of said
corporations; that the seals affixed to said instrument are such corporate
seals; that they were so affixed by authority of the Board of Directors of such
corporations, and that he signed his name thereto by like authority.
_________________________________
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the day of February, 2000, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ________________ of Rocket Newco, Inc., Henpil, Inc. and Wydiv, Inc.,
corporations described in and which executed the foregoing instrument; that he
knows the seals of said corporations; that the seals affixed to said instrument
are such corporate seals; that they were so affixed by authority of the Board of
Directors of said corporations, and that he signed his name thereto by like
authority.
_________________________________
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<PAGE> 40
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the day of February, 2000, before me personally came
_______________, to me known, who, being by me duly sworn, did depose and say
that he is _________________ of RJD Assurance, Inc. and Vine Court Assurance
Incorporated, one of the corporations described in and which executed the
foregoing instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
authority of the Boards of Directors of said corporation, and that he signed his
name thereto by like authority.
_________________________________
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the day of February, 2000, before me personally came
______________, to me known, who, being by me duly sworn, did depose and say
that he is ____________ of Richie's, Inc., one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Boards of Directors of said
corporation, and that he signed his name thereto by like authority.
_________________________________
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<PAGE> 41
STATE OF _________ )
) ss.:
COUNTY OF ________ )
On the day of February, 2000, before me personally came
_________________, to me known, who, being by me duly sworn, did depose and say
that he is a _____________ of Firstar Bank, National Association, one of the
corporations described in and which executed the foregoing instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
_________________________________
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