SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 20, 1998 (February 9, 1998)
------------------------------------
LOWE'S COMPANIES, INC.
----------------------
(Exact name of registrant as specified in charter)
North Carolina 0-94 56-0578072
- --------------- ----------- -------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
P.O. Box 1111
North Wilkesboro, North Carolina 28656-0001
-------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (336) 658-4000
-----------------
Not Applicable
--------------
(former name or former address if changed since last report)
<PAGE>
Page 1 of 4 pages.
Exhibit Index appears on page 4.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) The following exhibits are filed in connection with the Registrant's
offer and sale on February 9, 1998 of $300,000,000 principal amount of
6 7/8% Debentures due February 15, 2028 (the "Debentures") pursuant to
its Shelf Registration Statements on Form S-3 (File No. 333-14257 and File No.
333-42733). The Debentures were issued under the Amended and Restated
Indenture, dated December 1, 1995, between the Registrant and The First
National Bank of Chicago, as trustee.
Exhibits
1.1 Purchase Agreement, dated February 4, 1998, among Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Lehman Brothers Inc., Morgan Stanley & Co.
Incorporated and Lowe's Companies, Inc.
4.1 Amended and Restated Indenture, dated December 1, 1995,
between Lowe's Companies, Inc. and The First National Bank of
Chicago, as trustee (filed as Exhibit 4.1 to the Current
Report on Form 8-K of Lowe's Companies, Inc., filed on
December 15, 1995, and incorporated by reference herein).
4.2 Form of Lowe's Companies, Inc. 6 7/8% Debentures due February
15, 2028.
2
<PAGE>
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 hereunto duly authorized.
LOWE'S COMPANIES, INC.
Date: February 20, 1998 /s/ Richard D. Elledge
----------------------------------
Name: Richard D. Elledge
Title: Senior Vice President/
Assistant Secretary
3
<PAGE>
EXHIBIT INDEX
1.1 Purchase Agreement, dated February 4, 1998, among Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Lehman Brothers Inc., Morgan Stanley & Co.
Incorporated and Lowe's Companies, Inc.
4.1 Amended and Restated Indenture, dated December 1, 1995,
between Lowe's Companies, Inc. and The First National Bank of
Chicago, as trustee (filed as Exhibit 4.1 to the Current
Report on Form 8-K of Lowe's Companies, Inc., filed on
December 15, 1995, and incorporated by reference herein).
4.2 Form of Lowe's Companies, Inc. 6 7/8% Debentures due February
15, 2028.
4
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
LOWE'S COMPANIES, INC.
(a North Carolina corporation)
6-7/8% Debentures Due 2028
PURCHASE AGREEMENT
Dated: February 4, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
LOWE'S COMPANIES, INC.
(a North Carolina corporation)
6-7/8% Debentures Due 2028
PURCHASE AGREEMENT
February 4, 1998
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
LEHMAN BROTHERS INC.
MORGAN STANLEY & CO. INCORPORATED
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281-1201
Ladies and Gentlemen:
Lowe's Companies, Inc., a North Carolina corporation (the
"Company"), proposes to issue and sell to you, as underwriters (the
"Underwriters"), its 6-7/8% Debentures Due 2028 (the "Securities") on the terms
and conditions stated herein and in Schedule B. The Securities are to be sold to
each Underwriter, acting severally and not jointly, in the respective principal
amounts as are set forth in Schedule A hereto opposite the name of such
Underwriter. The Securities are to be issued pursuant to an Amended and Restated
Indenture dated as of December 1, 1995 (the "Indenture") between the Company and
The First National Bank of Chicago, as trustee (the "Trustee"). The Securities
and the Indenture are more fully described in the Prospectus referred to below.
The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(Registration No. 333-14257) ("Registration Statement No. 333-14257") and a
registration statement on Form S-3 (Registration No. 333-42733) ("Registration
Statement No. 333-42733"). Registration Statement No. 333-42733 includes a
combined prospectus prepared in accordance with Rule 429 under the Securities
Act of 1933, as amended (the "1933 Act"), relating to certain of its debt
securities, preferred stock, depositary shares, common stock, preferred stock
purchase rights and warrants and the offering thereof from time to time in
accordance with Rule 415 under the 1933 Act pursuant to both Registration
Statement No. 333-42733 as well as Registration Statement No. 333-14257. Each
registration statement has been declared effective by the Commission. As
provided in Section 3(a), a prospectus supplement reflecting the terms of the
Securities, the terms of the offering thereof and other matters set forth
therein has been prepared and will be filed pursuant to Rule 424 under the 1933
Act. Such prospectus supplement, in the form first filed after the date hereof
pursuant to Rule 424, is herein referred to as the "Prospectus Supplement." Such
registration statements, as amended at the date hereof, including the exhibits
thereto and the documents incorporated by reference therein, are hereinafter
referred to individually as a "Registration Statement" and collectively as the
"Registration Statements," and the basic prospectus included in Registration
Statement No. 333-42733 relating to all offerings of securities under the
Registration Statements, as supplemented by the Prospectus Supplement, is herein
called the "Prospectus," except that, if such basic prospectus is amended or
supplemented on or prior to the date on which the Prospectus Supplement is first
filed pursuant to Rule 424, the term "Prospectus" shall refer to the basic
prospectus as so amended or supplemented and as supplemented by the Prospectus
Supplement, in either case including the documents filed by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"1934 Act"), that are incorporated by reference therein.
The Company understands that the Underwriters propose to make
a public offering of the Securities as soon as you deem advisable after this
Agreement has been executed and delivered.
Section 1. Representations and Warranties. (a) The Company
represents and warrants to and agrees with each of the Underwriters that:
(i) On the original effective date of each Registration
Statement, on the effective date of the most recent post-effective
amendment thereto, if any, and on the date of the filing by the Company
of any annual report on Form 10-K after the original filing of any
Registration Statement, each Registration Statement complied in all
material respects with the requirements of the 1933 Act, the rules and
regulations of the Commission thereunder (the "1933 Act Regulations"),
the Trust Indenture Act of 1939, as amended (the "1939 Act") and the
rules and regulations of the Commission under the 1939 Act (the "1939
Act Regulations") and did 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; on the date
hereof and at the Closing Time (as defined below), (A) the Registration
Statements, and any amendments and supplements thereto, comply and will
comply in all material respects with the requirements of the 1933 Act,
the 1933 Act Regulations, the 1939 Act and the 1939 Act Regulations,
(B) neither any Registration Statement nor any amendment or supplement
thereto includes or will include an untrue statement of a material fact
or omits or will omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading and
(C) neither the Prospectus nor any amendment or supplement thereto
includes or will include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that the Company makes no
representations or warranties as to statements or omissions made in
reliance upon and in conformity with information furnished in writing
to the Company by or on behalf of any Underwriter, directly or through
you, expressly for use in the Registration Statements or the
Prospectus.
2
<PAGE>
(ii) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time they
were filed with the Commission, complied in all material respects with
the requirements of the 1934 Act, and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations") and, when read
together and with the other information in the Prospectus do not and
will not, on the date hereof and at the Closing Time, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein not misleading.
(iii) Deloitte & Touche, who have reported upon the audited
financial statements and schedules included or incorporated by
reference in each Registration Statement, are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iv) This Agreement has been duly authorized, executed and
delivered by the Company.
(v) The consolidated financial statements included or
incorporated by reference in the Registration Statements present fairly
the consolidated financial position of the Company and its subsidiaries
as of the dates indicated and the consolidated results of operations
and the consolidated cash flows of the Company and its subsidiaries for
the periods specified. Such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved. The financial
statement schedules, if any, included in the Registration Statements
present fairly the information required to be stated therein. The
selected financial data included or incorporated by reference in the
Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited consolidated
financial statements included or incorporated by reference in the
Registration Statements.
(vi) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of North
Carolina with corporate power and authority under such laws to own,
lease and operate its properties and conduct its business as described
in the Prospectus; and the Company is duly qualified to transact
business as a foreign corporation and is in good standing in each other
jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be in
good standing would not have a material adverse effect on the Company
and its subsidiaries, considered as one enterprise.
(vii) Each of Lowe's Home Centers, Inc., a North Carolina
corporation, LF Corporation, a Delaware corporation, and The Contractor
Yard, Inc., a North Carolina corporation (collectively, the
"Significant Subsidiaries"; "subsidiaries" has the meaning set forth in
Rule 405 under the 1933 Act), is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation with corporate power and authority under such laws to
own, lease and operate its properties and conduct its business; and
each Significant Subsidiary is duly qualified to transact business as a
foreign corporation and is in good standing in each other jurisdiction
in which it owns or leases property of a nature, or transacts business
of a type, that would make such qualification necessary, except to the
extent that the failure to so qualify or be in good standing would not
have a material adverse effect on the Company and its subsidiaries,
considered as one enterprise. All of the outstanding shares of capital
stock of each Significant Subsidiary have been duly authorized and
validly issued and are fully paid and nonassessable and are owned by
the Company, directly or through one or more Significant Subsidiaries,
free and clear of any pledge, lien, security interest, charge, claim,
equity or encumbrance of any kind.
3
<PAGE>
(viii) The Company had at the date indicated a duly
authorized, issued and outstanding capitalization as set forth in the
Prospectus under the caption "Capitalization."
(ix) The Indenture and any supplement thereto or board
resolution or other action of authorized officers of the Company
setting forth the terms of the Securities (the Indenture, as so
supplemented by the supplement, board resolutions or action of
authorized officers being herein referred to as the "Indenture") has
been duly authorized by the Company, will be substantially in the form
heretofore delivered to you and, when duly executed and delivered by
the Company and the Trustee, will constitute a valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law); and the Indenture conforms to the description
thereof in the Prospectus.
(x) The Securities have been duly authorized by the Company.
When executed, authenticated, issued and delivered in the manner
provided for in the Indenture and sold and paid for as provided in this
Agreement, the Securities will constitute valid and binding obligations
of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except
as enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law);
and the Securities conform to the description thereof in the
Prospectus.
(xi) All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid
and nonassessable; no holder thereof is or will be subject to personal
liability by reason of being such a holder; and none of the outstanding
shares of capital stock of the Company issued since December 19, 1979
was issued in violation of the preemptive rights of any stockholder of
the Company.
4
<PAGE>
(xii) Since the respective dates as of which information is
given in each Registration Statement and the Prospectus, except as
otherwise stated therein or contemplated thereby, there has not been
(A) any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise, whether or
not arising in the ordinary course of business, (B) any transaction
entered into by the Company or any subsidiary, other than in the
ordinary course of business, that is material to the Company and its
subsidiaries, considered as one enterprise, or (C) any dividend (other
than ordinary quarterly dividends declared, paid or made in the
ordinary course of business) or distribution of any kind declared, paid
or made by the Company on its capital stock.
(xiii) Neither the Company nor any Significant Subsidiary is
in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other agreement or instrument
to which it is a party or by which it may be bound or to which any of
its properties may be subject, except for such defaults that would not
have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise. The
execution and delivery of this Agreement and the Indenture by the
Company, the issuance and delivery of the Securities, the consummation
by the Company of the transactions contemplated in this Agreement, in
the Prospectus and in the Registration Statements and compliance by the
Company with the terms of this Agreement and the Indenture, have been
duly authorized by all necessary corporate action on the part of the
Company and do not and will not result in any violation of the charter
or by-laws of the Company or any Significant Subsidiary, and do not and
will not conflict with, or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Significant Subsidiary under (A) any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company or any Significant
Subsidiary is a party or by which it may be bound or to which any of
its properties may be subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise) or (B) any existing
applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any Significant Subsidiary or
any of their respective properties.
(xiv) No authorization, approval, consent or license of any
government, governmental instrumentality or court, domestic or foreign
(other than under the 1933 Act, the 1939 Act and the securities or blue
sky laws of the various states), is required for the valid
authorization, issuance, sale and delivery of the Securities, or for
the execution, delivery or performance of the Indenture by the Company.
(xv) Except as disclosed in the Prospectus, there is no
action, suit or proceeding before or by any government, governmental
instrumentality or court, domestic or foreign, now pending or, to the
knowledge of the Company, threatened against or affecting the Company
or any Significant Subsidiary that is required to be disclosed in the
Prospectus or that could result in any material adverse change in the
condition (financial or otherwise), earnings, business affairs or
business prospects of the Company and its subsidiaries, considered as
one enterprise, or that could materially and adversely affect the
properties or assets of the Company and its subsidiaries, considered as
one enterprise, or that could adversely affect the consummation of the
transactions contemplated in this Agreement; the aggregate of all
pending legal or governmental proceedings that are not described in the
Prospectus to which the Company or any Significant Subsidiary is a
party or which affect any of their respective properties, including
ordinary routine litigation incidental to the business of the Company
or any Significant Subsidiary, would not have a material adverse effect
on the condition (financial or otherwise), earnings, business affairs
or business prospects of the Company and its subsidiaries, considered
as one enterprise.
5
<PAGE>
(xvi) There are no contracts or documents of a character
required to be described in the Registration Statements or the
Prospectus or to be filed as exhibits to the Registration Statements
that are not described and filed as required.
(xvii) The Company and the Significant Subsidiaries each owns,
possesses or has obtained all material governmental licenses, permits,
certificates, consents, orders, approvals and other authorizations
necessary to own or lease, as the case may be, and to operate its
properties and to carry on its business as presently conducted (other
than such licenses, permits, certificates, consents, orders, approvals
and authorizations which, if neither owned, possessed nor obtained,
would not have a material adverse effect on the business of the Company
and its subsidiaries, considered as one enterprise), and neither the
Company nor any Significant Subsidiary has received any notice of
proceedings relating to revocation or modification of any such
licenses, permits, certificates, consents, orders, approvals or
authorizations.
(xviii) The Company and the Significant Subsidiaries each owns
or possesses, or can acquire on reasonable terms, adequate patents,
patent licenses, trademarks, service marks and trade names necessary to
carry on its business as presently conducted, and neither the Company
nor any Significant Subsidiary has received any notice of infringement
of or conflict with asserted rights of others with respect to any
patents, patent licenses, trademarks, service marks or trade names that
in the aggregate, if the subject of an unfavorable decision, ruling or
finding, could materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise.
(xix) To the best knowledge of the Company, no labor problem
exists with its employees or with employees of the Significant
Subsidiaries or is imminent that could adversely affect the Company and
its subsidiaries, considered as one enterprise, and the Company is not
aware of any existing or imminent labor disturbance by the employees of
any of its or the Significant Subsidiaries' principal suppliers,
contractors or customers that could be expected to materially adversely
affect the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and its subsidiaries,
considered as one enterprise.
(xx) The Company has not taken and will not take, directly or
indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Securities.
6
<PAGE>
(xxi) Except as disclosed in the Registration Statements and
except as would not individually or in the aggregate have a material
adverse effect on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise, (A) the Company and the
Significant Subsidiaries are each in compliance with all applicable
Environmental Laws, (B) the Company and the Significant Subsidiaries
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened Environmental
Claims against the Company or any of the Significant Subsidiaries, and
(D) there are no circumstances with respect to any property or
operations of the Company or the Significant Subsidiaries that could
reasonably be anticipated to form the basis of an Environmental Claim
against the Company or the Significant Subsidiaries.
For purposes of this Agreement, the following terms shall have
the following meanings: "Environmental Law" means any United States (or
other applicable jurisdiction's) federal, state, local or municipal
statute, law, rule, regulation, ordinance, code, policy or rule of
common law and any judicial or administrative interpretation thereof
including any judicial or administrative order, consent decree or
judgment, relating to the environment, health, safety or any chemical,
material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority. "Environmental Claims" means
any and all administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigations or proceedings relating in any way to any
Environmental Law.
(b) Any certificate signed by any officer of the Company or
any Significant Subsidiary and delivered to you or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company to
each Underwriter as to the matters covered thereby.
Section 2. Sale and Delivery to the Underwriters; Closing. (a)
On the basis of the representations and warranties herein contained, and subject
to the terms and conditions herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company, at the purchase price to the Underwriters set forth in
Schedule B, the principal amount of Securities set forth opposite the name of
such Underwriter in Schedule A, plus any additional principal amount of
Securities that such Underwriter may become obligated to purchase pursuant to
Section 10 of this Agreement.
(b) Payment of the purchase price for, and delivery of, the
Securities shall be made at the offices of Shearman & Sterling, 599 Lexington
Avenue, New York, New York 10022, or at such other place as shall be agreed upon
by the Company and you, at 10:00 A.M. on the third full business day after the
date of this Agreement (unless postponed pursuant to Section 10), or at such
other time not more than ten full business days thereafter as you and the
Company shall determine (such date and time of payment and delivery being herein
called the "Closing Time"). Payment shall be made to the Company by wire
transfer of immediately available funds to an account designated by the Company,
against delivery to you for the respective accounts of the several Underwriters
of the Securities to be purchased by them.
7
<PAGE>
(c) The Securities to be purchased by the Underwriters shall
be in such denominations and registered in such names as you may request in
writing at least two full business days before the Closing Time. The Securities
will be made available in New York City for examination and packaging by you not
later than 10:00 A.M. on the business day prior to the Closing Time.
Section 3. Certain Covenants of the Company. The Company
covenants with each Underwriter as follows:
(a) If reasonably requested by you in connection with the
offering of the Securities, the Company will prepare preliminary
prospectus supplements containing such information as you and the
Company deem appropriate, and, immediately following the execution of
this Agreement, the Company will prepare a Prospectus Supplement that
complies with the 1933 Act and the 1933 Act Regulations and that sets
forth the principal amount of the Securities and their terms not
otherwise specified in the Indenture, the name of each Underwriter
participating in the offering and the principal amount of the
Securities that each severally has agreed to purchase, the name of each
Underwriter, if any, acting as representative of the Underwriters in
connection with the offering, the price at which the Securities are to
be purchased by the Underwriters from the Company, any initial public
offering price, any selling concession and reallowance and any delayed
delivery arrangements, and such other information as you and the
Company deem appropriate in connection with the offering of the
Securities. The Company will promptly transmit copies of the Prospectus
Supplement to the Commission for filing pursuant to Rule 424 under the
1933 Act and will furnish to the Underwriters as many copies of any
preliminary prospectus supplements and the Prospectus as you shall
reasonably request.
(b) The Company will comply to the best of its ability with
the 1933 Act and the 1933 Act Regulations, the 1934 Act and the 1934
Act Regulations, and the 1939 Act and the 1939 Act Regulations so as to
permit the completion of the distribution of the Securities as
contemplated in this Agreement and the Prospectus. If at any time when
a prospectus is required by the 1933 Act to be delivered in connection
with sales of the Securities, any event shall occur or condition exist
as a result of which it is necessary, in the opinion of counsel for the
Underwriters or counsel for the Company, to amend the Registration
Statements or amend or supplement the Prospectus in order that the
Prospectus will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser, or if it shall be necessary,
in the opinion of either such counsel, at any such time to amend the
Registration Statements or amend or supplement the Prospectus in order
to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(d), such amendment or supplement as
may be necessary to correct such untrue statement or omission or to
make the Registration Statements or the Prospectus comply with such
requirements.
8
<PAGE>
(c) During the period when a prospectus is required by the
1933 Act to be delivered in connection with sales of the Securities,
the Company will, subject to Section 3(d), file promptly all documents
required to be filed with the Commission pursuant to Section 13, 14 or
15(d) of the 1934 Act.
(d) During the period when a prospectus is required by the
1933 Act to be delivered in connection with sales of the Securities,
the Company will inform you of its intention to file any amendment to
any Registration Statement, any supplement to the Prospectus or any
document that would as a result thereof be incorporated by reference in
the Prospectus; will furnish you with copies of any such amendment,
supplement or other document a reasonable time in advance of filing;
and will not file any such amendment, supplement or other document in a
form to which you or your counsel shall reasonably object.
(e) During the period when a prospectus is required by the
1933 Act to be delivered in connection with sales of the Securities,
the Company will notify you immediately, and confirm the notice in
writing, (i) of the effectiveness of any amendment to any Registration
Statement, (ii) of the transmission to the Commission for filing of any
supplement to the Prospectus or any document that would as a result
thereof be incorporated by reference in the Prospectus, (iii) of the
receipt of any comments from the Commission with respect to any
Registration Statement, the Prospectus or the Prospectus Supplement,
(iv) of any request by the Commission for any amendment to any
Registration Statement or any supplement to the Prospectus or for
additional information relating thereto or to any document incorporated
by reference in the Prospectus and (v) of the issuance by the
Commission of any stop order suspending the effectiveness of any
Registration Statement, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the
institution or threatening of any proceeding for any of such purposes.
The Company will use every reasonable effort to prevent the issuance of
any such stop order or of any order suspending such qualification and,
if any such order is issued, to obtain the lifting thereof at the
earliest possible moment.
(f) The Company has furnished or will furnish to you as many
signed copies of each Registration Statement (as originally filed) and
of all amendments thereto, whether filed before or after such
Registration Statement became effective, copies of all exhibits and
documents filed therewith or incorporated by reference therein (through
the end of the period when a prospectus is required by the 1933 Act to
be delivered in connection with sales of the Securities) and signed
copies of all consents and certificates of experts, as you may
reasonably request, and has furnished or will furnish to you, for each
of the Underwriters, one conformed copy of each Registration Statement
(as originally filed) and of each amendment thereto (including
documents incorporated by reference into the Prospectus but without
exhibits).
(g) The Company will use its best efforts, in cooperation with
the Underwriters, to qualify the Securities for offering and sale under
the applicable securities laws of such states and other jurisdictions
as you may designate and to maintain such qualifications in effect for
a period of not less than one year from the date hereof; provided,
however, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation or
as a dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject. The
Company will file such statements and reports as may be required by the
laws of each jurisdiction in which the Securities have been qualified
as above provided. The Company will also supply you with such
information as is necessary for the determination of the legality of
the Securities for investment under the laws of such jurisdictions as
you may request.
9
<PAGE>
(h) The Company will make generally available to its security
holders as soon as practicable, but not later than 45 days after the
close of the period covered thereby, an earnings statement of the
Company (in form complying with the provisions of Rule 158 of the 1933
Act Regulations), covering (i) a period of 12 months beginning after
the effective date of the Registration Statements and covering a period
of 12 months beginning after the effective date of any post-effective
amendment to any Registration Statement but not later than the first
day of the Company's fiscal quarter next following such respective
effective dates and (ii) a period of 12 months beginning after the date
of this Agreement but not later than the first day of the Company's
fiscal quarter next following the date of this Agreement.
(i) The Company will use the net proceeds received by it from
the sale of the Securities in the manner specified in the Prospectus
under the caption "Use of Proceeds."
(j) For a period of five years after the Closing Time, the
Company will furnish to you and, upon request, to each Underwriter,
copies of all annual reports, quarterly reports and current reports
filed with the Commission on Forms 10-K, 10-Q and 8-K, or such other
similar forms as may be designated by the Commission, and such other
documents, reports and information as shall be furnished by the Company
to its stockholders or security holders generally.
Section 4. Payment of Expenses. The Company will pay and bear
all costs and expenses incident to the performance of its obligations under this
Agreement, including (a) the preparation, printing and filing of the
Registration Statements (including financial statements and exhibits), as
originally filed and as amended, the preliminary prospectus supplement and the
Prospectus and any amendments or supplements thereto, and the cost of furnishing
copies thereto to the Underwriters, (b) the preparation, printing and
distribution of this Agreement, the Indenture, the Securities, the Blue Sky
Survey and the Legal Investment Survey, (c) the delivery of the Securities to
the Underwriters, (d) the fees and disbursements of the Company's counsel and
accountants, (e) the qualification of the Securities under the applicable
securities laws in accordance with Section 3(g) and any filing for review of the
offering with the National Association of Securities Dealers, Inc., including
filing fees and fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the Blue Sky Survey and the Legal
Investment Survey, (f) any fees charged by rating agencies for rating the
Securities and (g) the fees and expenses of the Trustee, including the fees and
disbursements of counsel for the Trustee, in connection with the Indenture and
the Securities.
10
<PAGE>
If this Agreement is terminated by you in accordance with the
provisions of Section 5 or 9(a)(i), the Company shall reimburse the Underwriters
for all their out-of-pocket expenses, including the fees and disbursements of
counsel for the Underwriters.
Section 5. Conditions of Underwriters' Obligations. The
obligations of the several Underwriters to purchase and pay for the Securities
that they have respectively agreed to purchase pursuant to this Agreement are
subject to the accuracy of the representations and warranties of the Company
contained herein or in certificates of any officer of the Company or any
Significant Subsidiary delivered pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder, and to the following
further conditions:
(a) At the Closing Time, no stop order suspending the
effectiveness of the Registration Statements shall have been issued
under the 1933 Act and no proceedings for that purpose shall have been
instituted or shall be pending or, to your knowledge or the knowledge
of the Company, shall be contemplated by the Commission, and any
request on the part of the Commission for additional information shall
have been complied with to the satisfaction of counsel for the
Underwriters.
(b) (i) At the Closing Time, you shall have received a signed
opinion of the General Counsel or Senior Corporate Counsel of the
Company, dated as of the Closing Time, together with signed or
reproduced copies of such opinion for each of the other Underwriters,
in form and substance satisfactory to counsel for the Underwriters, to
the effect that:
(A) The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of North Carolina, with corporate power and authority
under such laws to own, lease and operate its properties and
conduct its business as described in the Prospectus.
(B) Each Significant Subsidiary is a corporation duly
incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation with corporate
power and authority under such laws to own, lease and operate
its properties and conduct its business.
(C) All of the outstanding shares of capital stock of
the Company have been duly authorized and validly issued and
are fully paid and non-assessable, and no holder thereof is or
will be subject to personal liability by reason of being such
a holder; and none of the outstanding shares of capital stock
of the Company was issued in violation of the preemptive
rights of any stockholder of the Company.
(D) The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus under
the headings "Description of Preferred Stock" and "Description
of Common Stock".
(E) All of the outstanding shares of capital stock of
each Significant Subsidiary have been duly authorized and
validly issued and are fully paid and non-assessable; all of
such shares are owned by the Company, directly or through one
or more Significant Subsidiaries, free and clear of any
pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind; no holder thereof is subject to
personal liability by reason of being such a holder and none
of such shares was issued in violation of the preemptive
rights of any stockholder of the Significant Subsidiaries.
11
<PAGE>
(F) The Indenture has been duly authorized, executed
and delivered by the Company.
(G) The Securities have been duly authorized by the
Company and, assuming that the Securities have been duly
authenticated by the Trustee in the manner described in its
certificate delivered to you at the Closing Time (which fact
such counsel need not determine by an inspection of the
Securities), the Securities have been duly executed, issued
and delivered by the Company.
(H) Such counsel does not know of any statutes or
regulations, or any pending or threatened legal or
governmental proceedings, required to be described in the
Prospectus that are not described as required, nor of any
contracts or documents of a character required to be described
or referred to in the Registration Statements or the
Prospectus or to be filed as exhibits to the Registration
Statements that are not described, referred to or filed as
required.
(I) To the knowledge of such counsel, no default
exists in the performance or observance of any material
obligation, agreement, covenant or condition contained in any
contract, indenture, loan agreement, note, lease or other
agreement or instrument that is described or referred to in
the Registration Statements or the Prospectus or filed as an
exhibit to the Registration Statements.
(J) The execution and delivery of this Agreement and
the Indenture by the Company, the issuance and delivery of the
Securities, the consummation by the Company of the
transactions contemplated in this Agreement, in the Indenture,
in the Prospectus and in the Registration Statements, and the
compliance by the Company with the terms of this Agreement and
the Indenture do not and will not result in any violation of
the charter or by-laws of the Company or any Significant
Subsidiary, and do not and will not conflict with, or result
in a breach of, any of the terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Significant
Subsidiary under (1) any contract, indenture, mortgage, loan
agreement, note, lease or any other agreement or instrument
known to such counsel, to which the Company or any Significant
Subsidiary is a party or by which it may be bound or to which
any of its properties may be subject (except for such
conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a material adverse effect on
the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise), (2) any existing
applicable law, rule or regulation (other than the securities
or blue sky laws of the various states, as to which such
counsel need express no opinion), or (3) any judgment, order
or decree of any government, governmental instrumentality or
court, domestic or foreign, having jurisdiction over the
Company or any Significant Subsidiary or any of its respective
properties.
12
<PAGE>
(K) The descriptions in the Prospectus of the legal
or governmental proceedings, contracts and other documents
therein described are accurate and fairly summarize the
information required to be shown.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the sale of the Securities
pursuant to this Agreement as counsel for the Underwriters may
reasonably request. In giving such opinion, such counsel may rely, as
to all matters governed by the laws of jurisdictions other than the law
of the State of North Carolina and the federal law of the United
States, upon opinions of other counsel, who shall be counsel
satisfactory to counsel for the Underwriters, in which case the opinion
shall state that they believe you and they are entitled to so rely.
Such counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Significant
Subsidiaries and certificates of public officials; provided that such
certificates have been delivered to the Underwriters.
(ii) At the Closing Time, you shall have received a signed
opinion of Hunton & Williams, counsel for the Company, dated as of the
Closing Time, together with signed or reproduced copies of such opinion
for each of the other Underwriters, in form and substance satisfactory
to counsel for the Underwriters, to the effect that:
(A) The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of North Carolina with corporate power and authority
under such laws to own, lease and operate its properties and
conduct its business as described in the Prospectus.
(B) The Indenture has been duly authorized, executed
and delivered by the Company and, assuming due authorization,
execution and delivery by the Trustee, constitutes a valid and
binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as enforcement
thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles
of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law).
(C) The Securities have been duly authorized by the
Company and, assuming that the Securities have been duly
authenticated by the Trustee in the manner described in its
certificate delivered to you at the Closing Time (which fact
such counsel need not determine by an inspection of the
Securities), the Securities have been duly executed, issued
and delivered by the Company and constitute valid and binding
obligations of the Company entitled to the benefits of the
Indenture and enforceable against the Company in accordance
with their terms, except as enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors'
rights generally and except as enforcement thereof is subject
to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law).
13
<PAGE>
(D) This Agreement has been duly authorized, executed
and delivered by the Company.
(E) The Indenture has been duly qualified under the
1939 Act.
(F) The Securities and the Indenture conform in all
material respects as to legal matters to the descriptions
thereof in the Prospectus.
(G) No authorization, approval, consent or license of
any government, governmental instrumentality or court,
domestic or foreign (other than under the 1933 Act, the 1939
Act and the securities or blue sky laws of the various
states), is required for the valid authorization, issuance,
sale and delivery of the Securities or for the execution,
delivery or performance of the Indenture by the Company.
(H) The execution and delivery of this Agreement by
the Company, the issuance and delivery of the Securities, the
consummation by the Company of the transactions contemplated
in this Agreement, in the Indenture, in the Prospectus and in
the Registration Statements, and the compliance by the Company
with the terms of this Agreement and the Indenture do not and
will not result in any violation of the charter or by-laws of
the Company or any Significant Subsidiary.
(I) Registration Statement No. 333-14257 became
effective under the 1933 Act on November 8, 1996 and
Registration Statement No. 333-42733 became effective under
the 1933 Act on December 23, 1997; any required filing of any
preliminary prospectus supplement or the Prospectus Supplement
pursuant to Rule 424(b) has been made in the manner and within
the time period required by Rule 424(b); and, to the best of
the knowledge of such counsel, each Registration Statement is
still effective, no stop order suspending the effectiveness of
either Registration Statement has been issued and no
proceedings for that purpose have been instituted or are
pending or are contemplated under the 1933 Act.
(J) The Registration Statements and the Prospectus,
excluding the documents incorporated by reference therein, and
each amendment or supplement thereto (except for the financial
statements and other financial or statistical data included
therein or omitted therefrom, as to which such counsel need
express no opinion), as of their respective effective or issue
dates, appear on their face to have been appropriately
responsive in all material respects to the requirements of the
1933 Act and the 1933 Act Regulations, and the Indenture and
the Statement of Eligibility of the Trustee on Form T-1 filed
with the Commission as part of the Registration Statements
appear on their face to have been appropriately responsive in
all material respects to the requirements of the 1939 Act and
the 1939 Act Regulations.
14
<PAGE>
(K) The documents incorporated by reference in the
Prospectus (except for the financial statements and other
financial or statistical data in tabular format included
therein or omitted therefrom, as to which such counsel need
express no opinion, and except to the extent that any
statement therein is modified or superseded in the
Prospectus), as of the dates they were filed with the
Commission, appear on their face to have been appropriately
responsive in all material respects to the requirements of the
1934 Act and the 1934 Act Regulations.
(L) The descriptions in the Prospectus of the
statutes and regulations, therein described are accurate and
fairly summarize the information required to be shown.
(M) Such counsel have participated in the preparation
of the Registration Statements and the Prospectus and are
familiar with or have participated in the preparation of the
documents incorporated by reference in the Prospectus and no
facts have come to the attention of such counsel to lead them
to believe that (1) each Registration Statement (except for
the financial statements and other financial information and
statistical data in tabular format included or incorporated by
reference therein or omitted therefrom and the Statement of
Eligibility of the Trustee on Form T-1 filed in connection
with such Registration Statement, as to which such counsel
need express no opinion), on each date when it became
effective, and on the date of this Agreement, contained any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading, (2) the Prospectus
(except for the financial statements and other financial
information and statistical data in tabular format included or
incorporated by reference therein or omitted therefrom, as to
which such counsel need express no opinion), as of the date of
the Prospectus Supplement and as of the Closing Time, included
or include an untrue statement of a material fact or omitted
or omit to state a material fact necessary in order to make
the statements therein, in light of the circumstances under
which they were made, not misleading, or (3) the documents
incorporated by reference in the Prospectus (except for the
financial statements and other financial information and
statistical data in tabular format included therein or omitted
therefrom, as to which such counsel need express no opinion),
as of the date they were filed with the Commission, included
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.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the sale of the Securities
pursuant to this Agreement as counsel for the Underwriters may
reasonably request. In giving such opinion, such counsel may rely, as
to all matters governed by the laws of jurisdictions other than the law
of the States of New York and North Carolina and the federal law of the
United States, upon opinions of other counsel, who shall be counsel
satisfactory to counsel for the Underwriters, in which case the opinion
shall state that they believe you and they are entitled to so rely.
Such counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and the Significant
Subsidiaries and certificates of public officials; provided that such
certificates have been delivered to the Underwriters.
15
<PAGE>
(c) At the Closing Time, you shall have received the favorable
opinion of Shearman & Sterling, counsel for the Underwriters, dated as
of the Closing Time, together with signed or reproduced copies of such
opinion for each of the other Underwriters, to the effect that the
opinions delivered pursuant to Sections 5(b)(i) and 5(b)(ii) hereof
appear on their face to be appropriately responsive to the requirements
of this Agreement except, specifying the same, to the extent waived by
you, and with respect to the incorporation and legal existence of the
Company, the Securities, this Agreement, the Indenture, the
Registration Statements, the Prospectus, the documents incorporated by
reference and such other related matters as you may require. In giving
such opinion such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York and
the federal law of the United States, upon the opinions of counsel
satisfactory to you. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and the
Significant Subsidiaries and certificates of public officials; provided
that such certificates have been delivered to the Underwriters.
(d) At the Closing Time, (i) the Registration Statements and
the Prospectus, as they may then be amended or supplemented, shall
contain all statements that are required to be stated therein under the
1933 Act and the 1933 Act Regulations and in all material respects
shall conform to the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the 1939 Act Regulations, and neither
the Registration Statements nor the Prospectus, as they may then be
amended or supplemented, shall 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,
(ii) there shall not have been, since the respective dates as of which
information is given in each Registration Statement, any material
adverse change in the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise, whether or not arising in
the ordinary course of business, (iii) no action, suit or proceeding
shall be pending or, to the knowledge of the Company, threatened
against the Company or any Significant Subsidiary that would be
required to be set forth in the Prospectus other than as set forth
therein and no proceedings shall be pending or, to the knowledge of the
Company, threatened against the Company or any Significant Subsidiary
before or by any government, governmental instrumentality or court,
domestic or foreign, that could result in any material adverse change
in the condition (financial or otherwise), earnings, business affairs
or business prospects of the Company and its subsidiaries, considered
as one enterprise, other than as set forth in the Prospectus, (iv) the
Company shall have complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to the
Closing Time and (v) the other representations and warranties of the
Company set forth in Section 1(a) shall be accurate as though expressly
made at and as of the Closing Time. At the Closing Time, you shall have
received a certificate of the President or a Vice President, and the
Treasurer or Controller, of the Company, dated as of the Closing Time,
to such effect.
16
<PAGE>
(e) At the time that this Agreement is executed by the
Company, you shall have received from Deloitte & Touche a letter, dated
such date, in form and substance satisfactory to you, together with
signed or reproduced copies of such letter for each of the other
Underwriters, confirming that they are independent public accountants
with respect to the Company within the meaning of the 1933 Act and
applicable published 1933 Act Regulations, and stating in effect that:
(i) in their opinion, the audited financial
statements and the related financial statement schedules
included or incorporated by reference in the Registration
Statements and the Prospectus comply as to form in all
material respects with the applicable accounting requirements
of the 1933 Act and the 1934 Act and the published rules and
regulations thereunder;
(ii) on the basis of procedures (but not an
examination in accordance with generally accepted auditing
standards) consisting of a reading of the unaudited interim
consolidated financial statements of the Company for the
nine-month periods ended October 31, 1996 and October 31,
1997, included or incorporated by reference in the
Registration Statements and the Prospectus (collectively, the
"10-Q Financials"), a reading of the latest available
unaudited interim consolidated financial statements of the
Company, a reading of the minutes of all meetings of the
stockholders and directors of the Company and its subsidiaries
since February 1, 1997, inquiries of certain officials of the
Company and its subsidiaries responsible for financial and
accounting matters with respect to the changes in the
financial statement items after October 31, 1997 performed at
the request of the Company, 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 10-Q Financials incorporated by
reference in the Registration Statements and the
Prospectus do not comply as to form in all material
respects with the accounting requirements of the 1934
Act and the 1934 Act Regulations applicable to
unaudited financial statements included in Form 10-Q
or are not in conformity with generally accepted
accounting principles applied on a basis
substantially consistent with that of the audited
financial statements included or incorporated by
reference in the Registration Statements and the
Prospectus;
(B) at January 2, 1998 and at a specified
date not more than five days prior to the date of
this Agreement, there was any change in the common
stock of the Company and its subsidiaries or any
decrease in the consolidated net current assets or
consolidated net assets of the Company and its
subsidiaries or any increase in the long-term debt of
the Company and its subsidiaries, in each case as
compared with amounts shown in the October 31, 1997
unaudited consolidated balance sheet included in the
Registration Statements, except in each case for
changes, decreases or increases that the Registration
Statements disclose have occurred or may occur; or
17
<PAGE>
(C) for the period from November 1, 1997 to
January 2, 1998 and for the period from January 2,
1998 to a specified date not more than five days
prior to the date of this Agreement, there were any
decreases in consolidated net sales or in the total
or per share amounts of consolidated net income, in
each case as compared with the comparable period in
the preceding year, except in each case for any
decreases that the Registration Statements disclose
have occurred or may occur;
(iii) based upon the procedures set forth in clause
(ii) above and a reading of the consolidated financial
statements and financial statement schedules included in the
Registration Statements and a reading of the financial
statements, from which certain of such data were derived,
nothing has come to their attention that gives them reason to
believe that the consolidated financial statements and
financial statement schedules included in the Registration
Statements do not comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act
and the 1933 Act Regulations; and
(iv) in addition to the procedures referred to in
clause (ii) above, they have performed other specified
procedures, not constituting an audit, with respect to certain
amounts, percentages, numerical data and financial information
appearing in the Registration Statements, which have
previously been specified by you and which shall be specified
in such letter, and have compared certain of such items with,
and have found such items to be in agreement with, the
accounting and financial records of the Company.
(f) At the Closing Time, you shall have received from Deloitte
& Touche a letter, in form and substance satisfactory to you and dated
as of the Closing Time, to the effect that they reaffirm the statements
made in the letter furnished pursuant to Section 5(e), except that the
specified date referred to shall be a date not more than five days
prior to the Closing Time.
(g) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Time, there shall not have been any
downgrading, nor any notice given of any intended or potential
downgrading or of a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities, including the Securities, by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the 1933 Act.
(h) At the Closing Time, counsel for the Underwriters shall
have been furnished with all such documents, certificates and opinions
as they may reasonably request for the purpose of enabling them to pass
upon the issuance and sale of the Securities as contemplated in this
Agreement and the matters referred to in Section 5(c) and in order to
evidence the accuracy and completeness of any of the representations,
warranties or statements of the Company, the performance of any of the
covenants of the Company, or the fulfillment of any of the conditions
herein contained; and all proceedings taken by the Company at or prior
to the Closing Time in connection with the authorization, issuance and
sale of the Securities as contemplated in this Agreement shall be
satisfactory in form and substance to you and to counsel for the
Underwriters.
18
<PAGE>
If any of the conditions specified in this Section 5 shall not
have been fulfilled when and as required by this Agreement, this Agreement may
be terminated by you on notice to the Company at any time at or prior to the
Closing Time, and such termination shall be without liability of any party to
any other party, except as provided in Section 4. Notwithstanding any such
termination, the provisions of Sections 6, 7 and 8 shall remain in effect.
Section 6. Indemnification.
(a) Indemnification of the Underwriters. The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any,
who controls such Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statements (or any amendment thereto), including all
documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arising out
of an untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus supplement or the Prospectus (or
any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, provided
that (subject to Section 6(d) hereof) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by you,
reasonably incurred in investigating, preparing or defending against
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch") expressly for use in the Registration Statements
(or any amendment thereto) or any preliminary prospectus supplement or the
Prospectus (or any amendment or supplement thereto).
19
<PAGE>
(b) Indemnification of the Company, Directors and Officers.
Each Underwriter severally agrees to indemnify and hold harmless the Company,
its directors, each of its officers who signed the Registration Statements and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity agreement in
Section 6(a) hereof, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statements (or any amendment thereto) or any preliminary prospectus supplement
or the Prospectus (or any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through you expressly for use in the Registration Statements (or any
amendment thereto) or such preliminary prospectus supplement or the Prospectus
(or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties indemnified pursuant
to Section 6(a) hereof, counsel to the indemnified parties shall be selected by
Merrill Lynch and, in the case of parties indemnified pursuant to Section 6(b)
hereof, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. An indemnifying party may participate at its own expense in
the defense of any such action. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Settlement Without Consent if Failure to Reimburse. If at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) hereof effected without its written
consent if (i) such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement. The indemnified party shall
promptly reimburse the indemnifying party for all amounts advanced to it
pursuant to this Section 6(d) hereof (unless it is entitled to such amounts
under Section 7 hereof) if it shall be finally judicially determined that such
indemnified party was not entitled to indemnification hereunder and such loss,
liability, claim, damage or expense arose out of (i) an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by the indemnified
party expressly for use in the Registration Statements (or any amendment
thereto) or any preliminary prospectus supplement or the Prospectus (or any
amendment or supplement thereto) or (ii) a fraudulent misrepresentation (within
the meaning of Section 11 of the 1933 Act) by the indemnified party.
20
<PAGE>
SECTION 7. Contribution
If the indemnification provided for in Section 6 hereof is for
any reason unavailable to or insufficient to hold harmless an indemnified party
in respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, from the offering of the Securities pursuant to
this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company, on the one hand, and of the Underwriters, on the other hand, in
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company, on the one
hand, and the Underwriters, on the other hand, in connection with the offering
of the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the Underwriters, in
each case as set forth on the cover of the Prospectus bear to the aggregate
initial public offering price of the Securities as set forth on such cover.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters 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 Section 7 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 Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon such untrue or alleged untrue
statement or omission or alleged omission.
21
<PAGE>
Notwithstanding the provisions of this Section 7, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the 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 1933 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statements, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Securities set forth opposite their
respective names in Schedule A hereto and not joint.
Section 8. Representations, Warranties and Agreements to
Survive Delivery. The representations, warranties, indemnities, agreements and
other statements of the Company or its officers set forth in or made pursuant to
this Agreement will remain operative and in full force and effect regardless of
any investigation made by or on behalf of the Company, any Underwriter or any
person who controls the Company or any Underwriter within the meaning of Section
15 of the 1933 Act and will survive delivery of and payment for the Securities.
Section 9. Termination of Agreement. (a) You may terminate
this Agreement, by notice to the Company, at any time at or prior to the Closing
Time (i) if there has been, since the respective dates as of which information
is given in the Prospectus, any material adverse change in the condition
(financial or otherwise), earnings, business affairs or business prospects of
the Company and its subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States or any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which on the financial markets of the United States is such as to make
it, in your judgment, impracticable to market the Securities or enforce
contracts for the sale of the Securities or (iii) if trading in any securities
of the Company has been suspended by the Commission or the National Association
of Securities Dealers, Inc., or if trading generally on either the American
Stock Exchange or the New York Stock Exchange or in the over-the-counter market
has been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by such exchange or
by order of the Commission, the National Association of Securities Dealers, Inc.
or any other governmental authority or (iv) if a banking moratorium has been
declared by either federal, New York or North Carolina authorities. As used in
this Section 9(a), the term "Prospectus" means the Prospectus in the form first
used to confirm sales of the Securities.
22
<PAGE>
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party,
except to the extent provided in Section 4. Notwithstanding any such
termination, the provisions of Sections 6, 7 and 8 shall remain in effect.
(c) This Agreement may also terminate pursuant to the
provisions of Section 2, with the effect stated in such Section.
Section 10. Default by One or More of the Underwriters. If one
or more of the Underwriters shall fail at the Closing Time to purchase the
Securities that it or they are obligated to purchase pursuant to this Agreement
(the "Defaulted Securities"), you shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms set forth in this Agreement; if, however, the non-defaulting Underwriters
have not completed such arrangements within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Securities
does not exceed 10% of the aggregate principal amount of the Securities
to be purchased pursuant to this Agreement, each non-defaulting
Underwriter shall be obligated to purchase the full amount thereof in
the proportions that their respective Securities underwriting
obligation proportions bear to the underwriting obligations of all
non-defaulting Underwriters; or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the aggregate principal amount of the Securities to be
purchased pursuant to this Agreement, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default that does not result in a
termination of this Agreement, either the non-defaulting Underwriters or the
Company shall have the right to postpone the Closing Time for a period not
exceeding seven days in order to effect any required changes in the Registration
Statements or Prospectus or in any other documents or arrangements. As used
herein, the term "Underwriter" includes any person substituted for a Underwriter
under this Section 10.
Section 11. Notices. All notices and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given if delivered, mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters and the Company shall be directed
to the addresses specified below.
23
<PAGE>
To the Company:
Lowe's Companies, Inc.
P.O. Box 1111
North Wilkesboro, North Carolina 28656
Attention: William C. Warden, Jr., Executive Vice President,
General Counsel
Telecopy No.: (910) 658-4766
To the Underwriters:
c/o Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower - 10th Floor
New York, New York 10281-1310
Attention: A. Scott Lemone
Telecopy No.: (212) 449-8654
Section 12. Parties. This Agreement herein set forth is made
solely for the benefit of the several Underwriters, the Company and, to the
extent expressed, any person who controls the Company or any of the Underwriters
within the meaning of Section 15 of the 1933 Act, and the directors of the
Company, its officers who have signed the Registration Statements, and their
respective executors, administrators, successors and assigns and, subject to the
provisions of Section 10, no other person shall acquire or have any right under
or by virtue of this Agreement. The term "successors and assigns" shall not
include any purchaser, as such purchaser, from any of the several Underwriters
of the Securities. All of the obligations of the Underwriters hereunder are
several and not joint.
Section 13. Representation of Underwriters. Merrill Lynch will
act for the several Underwriters in connection with the transactions
contemplated by this Agreement, and any action under or in respect of this
Agreement taken by Merrill Lynch will be binding upon all Underwriters.
Section 14. Governing Law and Time. This Agreement shall be
governed by the laws of the State of New York. Specified times of the day refer
to New York City time.
Section 15. Counterparts. This Agreement may be executed in
one or more counterparts, and when a counterpart has been executed by each
party, all such counterparts taken together shall constitute one and the same
agreement.
------------------------------
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement between the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
LOWE'S COMPANIES, INC.
By /s/ Robert A. Niblock
---------------------
Name: Robert A. Niblock
Title: Vice President and Treasurer
CONFIRMED AND ACCEPTED as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
LEHMAN BROTHERS INC.
MORGAN STANLEY & CO. INCORPORATED
By: Merrill Lynch, Pierce, Fenner & Smith Incorporated
By /s/ Scot G. Primrose
--------------------
<PAGE>
SCHEDULE A
Principal
amount of
Underwriter Securities
- ----------- ----------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.....................................$100,000,000
Lehman Brothers Inc............................................. $100,000,000
Morgan Stanley & Co. Incorporated............................... $100,000,000
------------
Total $300,000,000
<PAGE>
SCHEDULE B
Dated: February 4, 1998
LOWE'S COMPANIES, INC.
6-7/8% Senior Securities Due 2028
Principal amount to be issued: $300,000,000
Current ratings: None
Interest rate: 6-7/8%, payable semiannually on February 15 and August 15 of each
year, beginning August 15, 1998
Interest accrues from: February 9, 1998
Date of maturity: February 15, 2028
Redemption provisions: None
Sinking fund requirements: None
Initial public offering price: 99.595% of the principal amount plus accrued
interest from February 9, 1998.
Purchase price: 98.720% of the principal amount plus accrued interest from
February 9, 1998.
Closing date, time and location: February 9, 1998, 10:00 A.M., New York City
time, at Shearman & Sterling, 599 Lexington Avenue, New York, New York
Delayed delivery contracts: Not authorized
Listing requirement: None
Other terms and conditions: None
UNLESS THIS DEBENTURE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO LOWE'S COMPANIES,
INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
DEBENTURE 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.
LOWE'S COMPANIES, INC.
6 7/8% DEBENTURES DUE FEBRUARY 15, 2028
No. R
Principal Amount: $
CUSIP No.: 548661AH0
Lowe's Companies, Inc., a corporation duly organized and existing under
the laws of the State of North Carolina (the "Company"), which term includes any
successor under the Indenture hereinafter referred to), for value received,
hereby promises to pay to
SPECIMEN
or registered assigns, the principal sum of $ on February 15, 2028, and
to pay interest thereon from February 9, 1998 or from the most recent Interest
Payment Date on which interest has been paid or duly provided for,
semi-annually in arrears on February 15 and August 15 in each year, commencing
August 15, 1998, at the rate of 6 7/8% per annum, until the principal hereof
is paid or made available for payment, and at the same rate per annum on any
overdue principal and premium and on any overdue installment of interest until
paid.
This debenture (the "Debenture") is a "book-entry" debenture and is
being registered in the name of Cede & Co. as nominee of The Depository Trust
Company ("DTC"), a clearing agency. Subject to the terms of the Indenture, this
Debenture will be held by a clearing agency or its nominee, and beneficial
interests will be held by beneficial owners through the book-entry facilities of
such clearing agency or its nominee in minimum denominations of $1,000 and
increments of $1,000 in excess thereof.
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 Debenture is registered at the close of business on the
Regular Record Date for such interest, which shall be the February 1 or August 1
(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 person in whose name this
Debenture is registered on such Regular Record Date and may either be paid to
the person in whose name this Debenture is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interested to be
fixed by the Trustee, notice whereof shall be given to the person in whose name
this Debenture is registered not less than ten days prior to such Special Record
Date, or be paid at any time in any other lawful manner, all as more fully
provided in said Indenture.
<PAGE>
As long as this Debenture is registered in the name of DTC or its
nominee, the Trustee will make payments of principal of and interest on this
Debenture by wire transfer of immediately available funds to DTC or its nominee.
Notwithstanding the above, the final payment on this Debenture will be made
after due notice by the Trustee of the pendency of such payment and only upon
presentation and surrender of this Debenture at its principal corporate trust
office or such other offices or agencies appointed by the Trustee for that
purpose and such other locations provided in the Indenture.
Payments of the principal of (and premium, if any) and interest on this
Debenture will be made at the office or agency of the Company maintained for
that purpose in the Borough of Manhattan, The City of New York, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payments 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.
This Debenture is one of a duly authorized issue of Debentures of the
Company, designated 6 7/8% Debentures due February 15, 2028, issued in aggregate
principal amount of $300,000,000, as specifically set forth in an amended and
restated indenture dated as of December 1, 1995 (the "Indenture"), between the
Company and The First National Bank of Chicago, as trustee (the "Trustee," which
term includes any successor Trustee under the Indenture). Reference is hereby
made to the Indenture and all indentures supplemental thereto for a statement of
the respective rights thereunder of the Company, the Trustee and the Holders of
the Debentures, and the terms upon which the Debentures are, and are to be,
authenticated and delivered. All terms used in this Debenture that are defined
in the Indenture shall have the meanings assigned to them in the Indenture.
The Debentures do not have the benefit of any sinking fund obligations
and will not be redeemable at the option of the Company or repayable at the
option of the Holder prior to maturity.
If an Event of Default shall occur and be continuing, the principal of
all the Debentures may be declared due and payable in the manner and with the
effect provided in the Indenture.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company under this Debenture and (b) certain
restrictive covenants and the related defaults and Events of Default applicable
to the Company, in each case, upon compliance by the Company with certain
conditions set forth in the Indenture, which provisions apply to this Debenture.
2
<PAGE>
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 Debentures under the Indenture at
any time by the Company, the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Debentures at the time
outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the Debentures at the
time outstanding, on behalf of the Holders of all Debentures, 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 Debenture shall be conclusive and binding upon such
Holder and upon all future Holders of this Debenture and of any Debenture issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Debenture.
No reference herein to the Indenture and no provision of this Debenture
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Debenture at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations on
transfer of this Debenture by DTC or its nominee, the transfer of this Debenture
is registrable in the Security Register, upon surrender of this Debenture for
registration of transfer at the office or agency of the Company in the Borough
of Manhattan, the City of New York, 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 Debentures, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Debentures are issuable only in fully-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,
Debentures are exchangeable for a like aggregate principal amount of Debentures
of a different authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debenture 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 Debenture is registered as the owner
hereof for all purposes, whether or not this Debenture be overdue, and none of
the Company, the Trustee or any such agent shall be affected by notice to the
contrary.
3
<PAGE>
Interest on this Debenture shall be computed on the basis of a 360-day
year of twelve 30-day months.
The Company will furnish to any Holder of record of Debentures upon
written request and without charge a copy of the Indenture.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
The Indenture and this Debenture each shall be governed by and
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of law.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Debenture shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, LOWE'S COMPANIES, INC. has caused this instrument
to be duly executed.
Dated: February 9, 1998
LOWE'S COMPANIES, INC.
SPECIMEN
By______________________
Title:
Attest:
- --------------------------
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures referred to in the within-mentioned Indenture.
The First National Bank of Chicago,
as Trustee
4
<PAGE>
By__________________________
Authorized Signatory
5
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Debenture, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - tenants in common
TEN ENT - tenants by the entireties
JT TEN - joint tenants with right of survivorship and not as tenants in common
CUST - Custodian U/G/M/A or UNIF GIFT MIN ACT - Uniform Gifts to Minors Act
Additional abbreviations may also be used though not in the above list.
6
<PAGE>
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Please print or typewrite name and address of assignee)
- ------------------------------------------------------------------------------
(Please insert Social Security or other identifying Number of Assignee)
the within Debenture of Lowe's Companies, Inc. and does hereby irrevocably
constitute and appoint
_________________________________________________________________, Attorney, to
transfer the said Debenture on the books of the within named Lowe's Companies,
Inc., with full power of substitution in the premises.
Dated: __________________________
------------------------------------
NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of
this Debenture in every particular
without alteration or enlargement or
any change whatever.
- ---------------------------------
SIGNATURE GUARANTEED:
The signature must be guaranteed by
a member of the Securities Transfer
Agents Medallion Program.
Notarized or witnessed signatures
are not acceptable.
7
<PAGE>
PAYMENT INSTRUCTIONS
The assignee should include the following for purposes of payment:
Payment shall be made, by wire transfer or otherwise, in immediately
available funds, to _______________________, for the account of
___________________, account number _____________, or, if mailed by check, to
_________________________. Applicable reports and statements should be mailed to
_____________________. This information is provided by ___________________, the
assignee named above, or ______________________________, as its agent.
8
