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): May
22, 1998
SHOPKO STORES, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 1-10876 41-0985054
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
700 Pilgrim Way
Green Bay, Wisconsin 54304
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(920) 497-2211
This Current Report on Form 8-K is also filed for the
purpose of amending the description of the registrant's
Common Stock, par value $.01 per share, and the
registrant's Series B Preferred Share Purchase Rights.
<PAGE>
Item 5. Other Events.
On May 22, 1998 (the "Effective Time"), in order
to effect a change in its state of incorporation from
Minnesota to Wisconsin (the "Reincorporation"), ShopKo
Stores, Inc., a Minnesota corporation ("Old ShopKo"),
was merged with and into New ShopKo, Inc., a Wisconsin
corporation (the "Registrant"). At the Effective Time,
the Registrant changed its name to "ShopKo Stores,
Inc." Prior to the Effective Time, the Registrant had
been a wholly-owned subsidiary of Old ShopKo organized
for the purpose of effecting the Reincorporation. At
the Effective Time, the Registrant became the surviving
entity of the merger effected to complete the
Reincorporation. The merged entity is governed by the
Wisconsin Business Corporation Law ("WBCL") and the
Articles of Incorporation and By-laws of the
Registrant.
The Reincorporation (as more fully described in
Old ShopKo's definitive proxy statement dated April 10,
1998) was consummated pursuant to an Agreement and Plan
of Merger dated as of March 31, 1998 (the "Merger
Agreement"), by and between Old ShopKo and the
Registrant, and was approved by the shareholders of Old
ShopKo at its 1998 Annual Meeting of Shareholders held
on May 13, 1998.
At the Effective Time, the directors and executive
officers of Old ShopKo became the directors and
executive officers of the Registrant. The Registrant's
business, mailing address, principal executive offices
and telephone number are the same as those of Old
ShopKo.
Upon the Effective Time, each issued and
outstanding share of Old ShopKo common stock, par value
$.01 per share (the "Old ShopKo Common Stock"), was
automatically converted into one share of Registrant
common stock, par value $.01 per share (the "Registrant
Common Stock"). Outstanding options to purchase shares
of Old ShopKo Common Stock were automatically converted
into options to purchase the same number of shares of
Registrant Common Stock. Each employee stock plan and
any other employee benefit plan to which Old ShopKo was
a party, were assumed by the Registrant and, to the
extent any such plans provided for the issuance or
purchase of Old ShopKo Common Stock, such plans now
provide for the issuance or purchase of shares of
Registrant Common Stock. Each Right to purchase Old
ShopKo Series B Junior Participating Preferred Stock
issued under the Rights Agreement with Norwest Bank
Minnesota, as agent, was automatically converted into a
Right to purchase, upon the same terms and conditions,
an identical number of shares of the Registrant's
Series B Junior Participating Preferred Stock ("Series
B Preferred Stock").
It is not necessary for shareholders to exchange
their existing Old ShopKo stock certificates for new
stock certificates of the Registrant. Shares of Old
ShopKo Common Stock, traded under the symbol "SKO" on
the New York Stock Exchange (the "Exchange") prior to
the Reincorporation, continue to be traded on the
Exchange under such symbol as Registrant Common Stock.
Delivery of existing Old ShopKo stock certificates will
constitute "good delivery" of Registrant Common Stock.
The foregoing description of the Reincorporation
is not intended to be complete and is qualified in its
entirety by the complete texts of the Merger Agreement,
the Registrant's Articles
<PAGE>
of Incorporation and By-Laws,
and the description of the Reincorporation on pages 16-
29 of Old ShopKo's definitive Proxy Statement dated
April 10, 1998, all of which are included as exhibits
hereto and which are incorporated herein by reference.
The Registrant's Common Stock and Series B
Preferred Share Purchase Rights are deemed registered
under Section 12(b) of the Securities Exchange Act of
1934, as amended, pursuant to Rule 12g-3 thereunder.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
Exhibit Description
Number
2.1 Agreement and Plan of Merger, dated as of March 31
1998, by and between Old ShopKo the Registrant.
3.1 Amended and Restated Articles of Incorporation of
the Registrant, as filed with the Department of
Financial Institutions of the State of Wisconsin on
May 15, 1998.
3.2 By-Laws of the Registrant.
4.1 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust
National Association (f/k/a First Trust National
Association), as trustee, ("U.S. Bank Trust"), to
the Indenture dated as of March 12, 1992, with
respect to the Senior Notes due March 15, 2002.
4.2 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust,
to the Indenture dated as of March 12, 1992, with
respect to the Senior Notes due March 15, 2022.
4.3 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust,
to the Indenture dated as of July 15, 1993.
4.4 Rights Agreement Amendment dated as of May 22,
1998, by and between the Registrant and Norwest
Bank Minnesota, National Association, as Rights
Agent.
4.5 Assumption Agreement dated as of May 22, 1998, by
the Registrant for the benefit of the Agent and the
Banks named in the Credit Agreement dated as of
July 8, 1997.
10.1 Form of Indemnification Agreement between the
Registrant and each of its Directors.
<PAGE>
99.1 Pages 16-29 of the ShopKo Stores, Inc. definitive
Proxy Statement dated April 10, 1998, in connection
with the 1998 Annual Meeting of Shareholders.
<PAGE>
SIGNATURES
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.
Dated: May 22, 1998 SHOPKO STORES, INC.
By: /s/ Richard D. Schepp
-----------------------
Richard D. Schepp
Senior Vice President,
General Counsel and
Secretary
<PAGE>
EXHIBIT INDEX
Exhibit Description
Number
2.1 Agreement and Plan of Merger, dated as of March 31
1998, by and between Old ShopKo and the Registrant,
incorporated by reference to the ShopKo Stores,
Inc. definitive Proxy Statement dated April 10,
1998 filed in connection with the ShopKo Stores,
Inc. 1998 Annual Meeting of Shareholders.
3.1 Amended and Restated Articles of Incorporation of
the Registrant, as filed with the Department of
Financial Institutions of the State of Wisconsin on
May 15, 1998.*
3.2 By-Laws of the Registrant, incorporated by
reference to the ShopKo Stores, Inc. definitive
Proxy Statement dated April 10, 1998 filed in
connection with the ShopKo Stores, Inc. 1998 Annual
Meeting of Shareholders.
4.1 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust
National Association (f/k/a First Trust National
Association), as trustee, ("U.S. Bank Trust"), to
the Indenture dated as of March 12, 1992, with
respect to the Senior Notes due March 15, 2002.*
4.2 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust,
to the Indenture dated as of March 12, 1992, with
respect to the Senior Notes due March 15, 2022.*
4.3 First Supplemental Indenture, dated as of May 22,
1998, between the Registrant and U.S. Bank Trust,
to the Indenture dated as of July 15, 1993.*
4.4 Rights Agreement Amendment dated as of May 22,
1998, by and between the Registrant and Norwest
Bank Minnesota, National Association, as Rights
Agent.*
4.5 Assumption Agreement dated as of May 22, 1998, by
the Registrant for the benefit of the Agent and the
Banks named in the Credit Agreement dated as of
July 8, 1997.*
10.1 Form of Indemnification Agreement between the
Registrant and each of its Directors.*
99.1 Pages 16-29 of the ShopKo Stores, Inc. definitive
Proxy Statement dated April 10, 1998, in connection
with the ShopKo Stores, Inc. 1998 Annual Meeting of
Shareholders, incorporated by reference to such
pages of such definitive Proxy Statement.
_________________________
* Filed herewith.
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
NEW SHOPKO, INC.
These Amended and Restated Articles of
Incorporation shall supersede and replace the
heretofore existing Articles of Incorporation of New
Shopko, Inc., a Wisconsin corporation (the
"Corporation"), organized under the Wisconsin Business
Corporation Law:
ARTICLE I
NAME
The name of the Corporation is New ShopKo, Inc.
ARTICLE II
PURPOSES
The Corporation is authorized to engage in any
lawful activity for which corporations may be organized
under the Wisconsin Business Corporation Law and any
successor provisions.
ARTICLE III
CAPITAL STOCK
The aggregate number of shares which the
Corporation shall have the authority to issue, the
designation of each class of shares, the authorized
number of shares of each class and the par value
thereof per share shall be as follows:
Designation of Par Value Authorized
Class Per Share Number of
Shares
Common Stock $.01 75,000,000
Preferred Stock $.01 20,000,000
The preferences, limitations and relative rights
of shares of each class and series thereof, if any, and
the authority of the Board of Directors of the
Corporation to create and to designate series of
Preferred Stock and to determine the preferences,
limitations and relative rights as between series shall
be as follows:
A. Common Stock.
1. Voting. Except as otherwise provided by
law and except as may be determined by the Board
of Directors of the Corporation with respect to
shares of Preferred Stock as provided in Section
B, below, only the holders of shares of Common
Stock shall be entitled to vote for the election
of directors of the Corporation and for all other
corporate purposes. Except as otherwise provided
by law, upon any such vote, each holder of Common
Stock shall be entitled to one vote for each share
of Common Stock held of record by such
shareholder.
2. Dividends. Subject to the provisions of
paragraph (2) of Section B, below, the holders of
Common Stock shall be entitled to receive such
dividends as may be declared thereon from time to
time by the Board of Directors of the Corporation,
in its discretion, out of any funds of the
Corporation at the time legally available for
payment of dividends.
3. Liquidation. In the event of the
voluntary or involuntary dissolution, liquidation
or winding up of the Corporation, after there have
been paid to or set aside for the holders of
shares of Preferred Stock the full preferential
amounts, if any, to which they are entitled as
provided in paragraph (3) of Section B, below, the
holders of outstanding shares of Common Stock
shall be entitled to share ratably, according to
the number of shares held by each, in the
remaining assets of the Corporation available for
distribution.
B. Preferred Stock.
1. Series and Variations Between Series. The
Board of Directors of the Corporation is
authorized, to the full extent permitted under the
Wisconsin Business Corporation Law and the
provisions of this Section B, to provide for the
issuance of the Preferred Stock in one or more
series, each of such series to be distinctively
designated, and to have such voting rights,
redemption or conversion rights, dividend or
distribution rights, preferences with respect to
dividends or distributions, or other preferences,
limitations or relative rights as shall be
provided by the Board of Directors of the
Corporation consistent with the provisions of the
Wisconsin Business Corporation Law and this
Article III. The Board of Directors of the
Corporation, unless otherwise provided when the
series is established, may increase or decrease
the number of shares of any series, provided that
the number of shares of any series shall not be
reduced below the number of shares then
outstanding.
2. Dividends. Before any dividends (other
than a dividend payable solely in Common Stock)
shall be paid or set apart for payment upon shares
of Common Stock, the holders of each series of
Preferred Stock shall be entitled to receive
dividends at the rate (which may be fixed or
variable) and at such times as specified in the
particular series, if any. The holders of shares
of Preferred Stock shall have no rights to
participate with the holders of shares of Common
Stock in any dividends in excess of the
preferential dividends, if any, fixed for such
Preferred Stock.
3. Liquidation. In the event of
liquidation, dissolution or winding up (whether
voluntary or involuntary) of the Corporation, the
holders of shares of Preferred Stock shall be
entitled to be paid the full amount payable on
such shares upon the liquidation, dissolution or
winding up of the Corporation fixed by the Board
of Directors with respect to such shares, if any,
before any amount shall be paid to the holders of
the Common Stock.
C. Designation of Series B Preferred Stock. A
series of Preferred Stock is hereby created and is
designated as the "Series B Junior Participating
Preferred Stock" (the "Series B Preferred Stock") and
the number of shares constituting the Series B
Preferred Stock shall be 100,000. Such number of
shares of Series B Preferred Stock may be increased or
decreased by resolution of the Board of Directors of
the Corporation; provided, however, that no decrease
shall reduce the number of shares of Series B Preferred
Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options,
rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation
convertible into Series B Preferred Stock. The
preferences, limitations and relative rights of the
Series B Preferred Stock shall be as set forth on the
attachment hereto entitled "Preferences, Limitations
and Relative Rights of the Series B Junior
Participating Preferred Stock."
ARTICLE IV
BOARD OF DIRECTORS
A. Number. The number of directors (exclusive of
directors, if any, elected by the holders of one or
more series of Preferred Stock, voting separately as a
series pursuant to the provision of these Articles of
Incorporation applicable thereto) shall not be less
than one (1) nor more than fifteen (15) directors, the
exact number of directors to be determined from time to
time by resolution adopted by the affirmative vote of a
majority of the entire Board of Directors then in
office.
B. Classification of Board. The directors shall
be divided into three classes, designated Class I,
Class II and Class III, and the term of office of
directors of each class shall be three years. Each
class shall consist, as nearly as possible, of
one-third of the total number of directors constituting
the entire Board of Directors. If the number of
directors is changed by resolution of the Board of
Directors pursuant to this Article IV, any increase or
decrease shall be apportioned among the classes so as
to maintain the number of directors in each class as
nearly equal as possible, but in no case shall a
decrease in the number of directors shorten the term of
any incumbent director.
C. Tenure and Vacancies. A director shall hold
office until the annual meeting for the year in which
his or her term expires and until his or her successor
shall be elected and shall qualify. Any newly created
directorship resulting from an increase in the number
of directors and any other vacancy on the Board of
Directors, however caused, shall be filled by the vote
of a majority of the directors then in office, although
less than a quorum, or by a sole remaining director.
Any director so elected to fill any vacancy on the
Board of Directors, including a vacancy created by an
increase in the number of directors, shall hold office
for the remaining term of directors of the class to
which he or she has been elected and until his or her
successor shall be elected and shall qualify.
D. Removal of Directors. Exclusive of directors,
if any, elected by the holders of one or more classes
or series of Preferred Stock, no director of the
Corporation may be removed from office, except for
Cause and by the affirmative vote of not less than 75%
of the outstanding shares of capital stock of the
Corporation entitled to vote at a meeting of
shareholders duly called for such purpose. As used in
this Article IV, the term "Cause" shall mean solely
malfeasance arising from the performance of a
director's duties which has a materially adverse effect
on the business of the Corporation.
E. Nominations of Directors. No person, except
those nominated by or at the direction of the Board of
Directors, shall be eligible for election as a director
at any annual or special meeting of shareholders unless
a written request, in the form established by the
Corporation's By-laws, that a person's name be placed
in nomination is received from a shareholder of record
by the Secretary of the Corporation, together with the
written consent of such person to serve as a director,
(i) with respect to an election held at an annual
meeting of shareholders, not less than one hundred
twenty (120) days prior to the anniversary date of the
annual meeting of shareholders in the immediately
preceding year, or (ii) with respect to an election
held at a special meeting of shareholders for the
election of directors, not later than the close of
business on the eighth day following the date of the
earlier of public announcement or notice of such
meeting.
F. Amendment. Notwithstanding any other
provisions of these Articles of Incorporation or
By-laws of the Corporation (and notwithstanding the
fact that a lesser percentage may be specified by law,
these Articles of Incorporation or the By-laws of the
Corporation), this Article IV may be amended, altered
or repealed only by the affirmative vote of the holders
of not less than 75% of the outstanding total shares of
stock of the Corporation entitled to vote at a meeting
of shareholders duly called for such purpose and by the
affirmative vote of the holders of not less than a
majority of the shares of each class or series, if any,
entitled to vote thereon at such meeting.
ARTICLE V
BUSINESS COMBINATIONS
A. Special Vote for Certain Combinations. Except
as otherwise expressly provided in Section B of this
Article V:
(i) any merger or consolidation of the
Corporation with or into any other corporation;
(ii) any sale, lease, exchange or other
disposition of all or any substantial part of the
assets of the Corporation to or with any other
corporation, person or other entity; or
(iii) the issuance or transfer of any
securities of the Corporation by the Corporation
to any other corporation, person or other entity
in exchange for assets, cash or securities or a
combination thereof (except assets, cash or
securities or a combination thereof so acquired in
a single transaction or a series of related
transactions having an aggregate fair market value
of less than $10,000,000);
shall require the affirmative vote of the holders
of
(a) at least 75% of the outstanding shares
of capital stock of the Corporation entitled to
vote generally in the election of directors,
considered for the purposes of this Article V as
one class, and
(b) at least a majority of the outstanding
shares of capital stock of the Corporation which
are not beneficially owned by such corporation,
person or other entity,
if as of the record date for the determination
of shareholders entitled to notice thereof and
to vote thereon, such other corporation, person
or entity is the beneficial owner, directly or
indirectly, of 5% or more of the outstanding
shares of capital stock of the Corporation
entitled to vote generally in the election of
directors, considered for the purposes of this
Article V as one class. Such affirmative vote
shall be required notwithstanding the fact that
no vote may be required, or that some lesser
percentage may be specified by law or in any
agreement with any national securities exchange
or quotation system.
B. Special Vote Not Required. The provisions of
this Article V shall not apply to any transaction
described in clauses (i), (ii), or (iii) of Section A
of this Article V, (a) with another corporation, person
or other entity if a majority of the outstanding equity
interests in such other corporation, person or other
entity considered for this purpose as one class is
owned of record or beneficially by the Corporation
and/or its subsidiaries; or (b) with another
corporation, person or other entity if the Board of
Directors of the Corporation shall by resolution have
approved a memorandum of understanding with such other
corporation, person or other entity with respect to and
substantially consistent with such transaction prior to
the time such other corporation, person or other entity
became the beneficial owner, directly or indirectly, of
5% or more of the outstanding shares of capital stock
of the Corporation entitled to vote generally in the
election of directors; or (c) with another corporation,
person or other entity pursuant to a public or private
offering of securities of the Corporation if such
public or private offering does not involve any merger
or consolidation of the Corporation with or into any
other corporation and such public or private offering
has been approved by the Board of Directors of the
Corporation.
C. Beneficial Ownership. For the purposes of
this Article V, a corporation, person or other entity
shall be deemed to be the beneficial owner of any
shares of capital stock of the Corporation (i) which it
has the right to acquire pursuant to any agreement, or
upon exercise of conversion rights, warrants or
options, or otherwise, or (ii) which are beneficially
owned, directly or indirectly (including shares deemed
owned through application of clause (i) above), by any
other corporation, person or other entity (a) with
which it or its "affiliate" or "associate" (as defined
below) has any agreement, arrangement or understanding
for the purpose of acquiring, holding, voting or
disposing of capital stock of the Corporation or (b)
which is its "affiliate" or "associate" as those terms
were defined in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934
as in effect on September 24, 1997. For the purposes
of this Article V, the outstanding shares of any class
of capital stock of the Corporation shall include
shares deemed owned through the application of clauses
(i) and (ii) of this Section C but shall not include
any other shares which may be issuable pursuant to any
agreement, or upon exercise of conversion rights,
warrants or options, or otherwise.
D. Determination by Board of Directors. The
Board of Directors of the Corporation shall have the
power and duty to determine for the purposes of this
Article V, on the basis of information then known to
it, whether (i) any corporation, person or other entity
beneficially owns, directly or indirectly, 5% or more
of the outstanding shares of capital stock of the
Corporation entitled to vote generally in the election
of directors, or is an "affiliate" or an "associate"
(as defined above) of another, (ii) any proposed sale,
lease, exchange or other disposition of part of the
assets of the Corporation involves a substantial part
of the assets of the Corporation, (iii) assets, cash or
securities, or a combination thereof, to be acquired in
exchange for securities of the Corporation, have an
aggregate fair market value of less than $10,000,000
and whether the same are proposed to be acquired in a
single transaction or a series of related transactions,
and (iv) the memorandum of understanding referred to
above is substantially consistent with the transaction
to which it relates. Any such determination by the
Board shall be conclusive and binding for all purposes
of this Article V.
E. Amendment. Notwithstanding any other
provisions of these Articles of Incorporation or
By-laws of the Corporation (and notwithstanding the
fact that a lesser percentage may be specified by law,
these Articles of Incorporation or the By-laws of the
Corporation), this Article V may be amended, altered or
repealed only by the affirmative vote of the holders of
not less than 75% of the outstanding total shares of
stock of the Corporation entitled to vote at a meeting
of shareholders duly called for such purpose and by the
affirmative vote of the holders of not less than a
majority of the shares of each class or series, if any,
entitled to vote thereon at such meeting.
ARTICLE VI
PREEMPTIVE RIGHTS
No holder of any shares of the Corporation shall
have any preemptive or subscription rights nor be
entitled, as of right, to purchase or subscribe for any
part of the unissued shares of the Corporation or of
any additional shares issued by reason of any increase
of authorized shares of the Corporation or other
securities whether or not convertible into shares of
the Corporation.
ARTICLE VII
SHARE DIVIDENDS
A dividend payable in shares of any class or
series of the Corporation may be paid in shares of any
other class or series.
ARTICLE VIII
SHAREHOLDER ACTION
The shareholders of the Corporation shall not be
entitled to take action without a meeting by less than
unanimous consent.
ARTICLE IX
AMENDMENT OF BY-LAWS AND ARTICLES OF INCORPORATION
A. Amendment of By-Laws. Notwithstanding any
other provision of these Articles of Incorporation or
the Corporation's By-laws, the Corporation's By-laws
may be amended, altered or repealed, and new By-laws
may be enacted, only by the affirmative vote of the
holders of not less than 75% of the outstanding shares
of capital stock of the Corporation entitled to vote at
a meeting of shareholders duly called for such purpose
and by the affirmative vote of the holders of not less
than a majority of the shares of each class or series,
if any, entitled to vote thereon at such meeting, or by
a vote of not less than a majority of the entire Board
of Directors then in office.
B. Amendment of Articles of Incorporation.
Except as provided in Articles IV and V and this
Article IX, these Articles of Incorporation may be
amended, altered or repealed, and new Articles of
Incorporation may be enacted, only by the affirmative
vote of the holders of not less than a majority of the
outstanding total shares of stock of the Corporation
entitled to vote at a meeting of shareholders duly
called for such purpose and by the affirmative vote of
the holders of not less than a majority of the shares
of each class or series, if any, entitled to vote
thereon at such meeting; provided, however, that this
Article IX shall not limit the power of the
Corporation's Board of Directors to make certain
amendments to the Articles of Incorporation under
Chapter 180 of the Wisconsin Statutes and any successor
provisions without shareholder approval.
C. Amendment of this Article IX.
Notwithstanding any other provisions of these Articles
of Incorporation or By-laws of the Corporation (and
notwithstanding the fact that a lesser percentage may
be specified by law, these Articles of Incorporation or
the By-laws of the Corporation), this Article IX may be
amended, altered or repealed only by the affirmative
vote of the holders of not less than 75% of the
outstanding total shares of stock of the Corporation
entitled to vote at a meeting of shareholders duly
called for such purpose and by the affirmative vote of
the holders of not less than a majority of the shares
of each class or series, if any, entitled to vote
thereon at such meeting.
ARTICLE X
REGISTERED OFFICE
The address of the initial registered office of
the Corporation is 44 East Mifflin Street, Madison,
Wisconsin 53703. The name of its initial registered
agent at such address is CT Corporation System.
ARTICLE XI
The name and address of the incorporator is
Randall J. Erickson, Godfrey & Kahn, S.C., 780 North
Water Street, Milwaukee, Wisconsin 53202.
This instrument was drafted by:
Randall J. Erickson
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
ATTACHMENT
TO THE
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
NEW SHOPKO, INC.
PREFERENCES, LIMITATIONS AND
RELATIVE RIGHTS OF THE SERIES B
JUNIOR PARTICIPATING PREFERRED STOCK
1. Dividends and Distributions.
(a) Subject to the rights of the holders of any
shares of any series of Preferred Stock (or any similar
stock) ranking prior and superior to the Series B
Junior Participating Preferred Stock (the "Series B
Preferred Stock") with respect to dividends, the
holders of shares of Series B Preferred Stock, in
preference to the holders of Common Stock, par value
$0.01 per share (the "Common Stock") of the Corporation
and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of
Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the
first day of March, June, September and December in
each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series B
Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (i) $10 or (ii)
subject to the provision for adjustment hereinafter set
forth, 1,000 times the aggregate per share amount of
all cash dividends, and 1,000 times the aggregate per
share amount (payable in kind) of all non-cash
dividends or other distributions, other than a dividend
payable in shares of Common Stock or a subdivision of
the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common
Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first
Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series
B Preferred Stock. In the event the Corporation shall
at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the amount to
which holders of shares of Series B Preferred Stock
were entitled immediately prior to such event under
clause (ii) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
(b) The Corporation shall declare a dividend or
distribution on the Series B Preferred Stock as
provided in paragraph (A) of this Section immediately
after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares
of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on
the Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $10 per
share on the Series B Preferred Stock shall
nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(c) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series B Preferred
Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares, unless the
date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless
the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the
determination of holders of shares of Series B
Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly
Dividend Payment Date. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares
of Series B Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record
date for the determination of holders of shares of
Series B Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which
record date shall be not more than 60 days prior to the
date fixed for the payment thereof.
2. Voting Rights. The holders of shares of
Series B Preferred Stock shall have the following
voting rights:
(a) Subject to the provision for adjustment
hereinafter set forth, each share of Series B Preferred
Stock shall entitle the holder thereof to 1,000 votes
on all matters submitted to a vote of the shareholders
of the Corporation. In the event the Corporation shall
at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series B
Preferred Stock were entitled immediately prior to such
event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after
such event and the denominator of which is the number
of shares of Common Stock that were outstanding
immediately prior to such event.
(b) Except as otherwise provided herein, in any
Articles of Amendment or such other similar document
creating a series of Preferred Stock or any similar
stock, or by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common
Stock and any other capital stock of the Corporation
having general voting rights shall vote together as one
class on all makers submitted to a vote of shareholders
of the Corporation.
(c) Except as set forth herein, or as otherwise
provided by law, holders of Series B Preferred Stock
shall have no special voting rights and their consent
shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
3. Certain Restrictions.
(a) Whenever quarterly dividends or other
dividends or distributions payable on the Series B
Preferred Stock as provided in Section C.1, above, are
in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared,
on shares of Series B Preferred Stock outstanding shall
have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Preferred
Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except dividends paid ratably on the Series B
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up), to the Series B Preferred
Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock
of the Corporation ranking junior (either as to
dividends or upon dissolution, liquidation or winding
up) to the Series B Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
or any shares of stock ranking on a parity with the
Series B Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend
rates and other relative rights and preferences of the
respective series and classes, shall determine in good
faith will result in fair and equitable treatment among
the respective series or classes.
(b) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under
paragraph (a) of this Section 3, purchase or otherwise
acquire such shares at such time and in such manner.
4. Reacquired Shares. Any shares of Series B
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired
and canceled promptly after the acquisition thereof.
All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and
may be reissued as part of a new series of Preferred
Stock subject to the conditions and restrictions on
issuance set forth herein, in the Articles of
Incorporation, or in any Articles of Amendment or such
other similar document creating a series of Preferred
Stock or any similar stock or as otherwise required by
law.
5. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (a) to the
holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding
up) to the Series B Preferred Stock unless, prior
thereto, the holders of shares of Series B Preferred
Stock shall have received $1,000 per share, plus an
amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the
date of such payment, provided that the holders of
shares of Series B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the
provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount to be distributed
per share to holders of shares of Common Stock, or (b)
to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except distributions made ratably on the Series
B Preferred Stock and all such parity stock in
proportion to the total amounts to which the holders of
all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation
shall at any time declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the aggregate amount to which holders of
shares of Series B Preferred Stock were entitled
immediately prior to such event under the proviso in
clause (b) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
6. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other
stock or securities, cash and/or any other property,
then in any such case each share of Series B Preferred
Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the
provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each
share of Common Stock is changed or exchanged. In the
event the Corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the amount set forth in the preceding
sentence with respect to the exchange or change of
shares of Series B Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
7. No Redemption. The shares of Series B
Preferred Stock shall not be redeemable.
8. Rank. The Series B Preferred Stock shall
rank, with respect to the payment of dividends and the
distribution of assets, junior to all series of any
other class of the Corporation's Preferred Stock.
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of May
22, 1998, is between SHOPKO STORES, INC., a corporation
duly organized and existing under the laws of the state
of Wisconsin (herein called the "Company"), having its
principal office at 700 Pilgrim Way, Green Bay,
Wisconsin 54304 and U.S. BANK TRUST NATIONAL
ASSOCIATION (f/k/a First Trust National Association), a
national banking association duly organized and
existing under the laws of the United States, as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
Upon the merger of ShopKo Stores, Inc., a
corporation duly organized and existing under the laws
of the state of Minnesota (the "Predecessor"), with and
into the Company, the Company and the Trustee shall be
parties to an Indenture, dated as of March 12, 1992
(the "Indenture"), relating to the Company's 8.50%
Senior Notes due March 15, 2002. Capitalized terms
used herein and not otherwise defined shall have the
same meanings given to them in the Indenture.
The Company has requested the Trustee to join with
it in the execution and delivery of this First
Supplemental Indenture in order to supplement the
Indenture to permit the Predecessor to merge with and
into the Company.
Section 901 of the Indenture provides that a
supplemental indenture may be entered into by the
Company and the Trustee, without the consent of any
Holders, to evidence the succession of another Person
to the Predecessor and the assumption by any such
successor to the covenants of the Predecessor in the
Indenture and in the Securities.
The Company has determined that this First
Supplemental Indenture complies with said Section 901
and does not require the consent of any Holders.
The Company has furnished the Trustee with such
documents as may have been required by Section 801 of
the Indenture.
All things necessary to make this First
Supplemental Indenture a valid agreement of the Company
and the Trustee and a valid amendment of and supplement
to the Indenture have been done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises, it is
mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities,
or of series thereof, as follows:
The Company hereby expressly assumes the due and
punctual payment of the principal of and interest on
all the Securities and the performance or observance of
every covenant of the Indenture on the part of the
Predecessor to be performed or observed.
GENERAL PROVISIONS
The recitals contained herein shall be taken as
the statements of the Company, and the Trustee assumes
no responsibility for the correctness of the same. The
Trustee makes no representation as to the validity of
the First Supplemental Indenture. The Indenture, as
supplemented by this First Supplemental Indenture, is
in all respects hereby ratified and confirmed.
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed
to be an original, but all such counterparts shall
together constitute but one and the same instrument.
This First Supplemental Indenture shall be
governed by and construed in accordance with the laws
of the State of New York, but without regard to
principles of conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have caused
this First Supplemental Indenture to be duly executed,
and their respective corporate seals to be hereunto
affixed and attested, all as of the day and year first
above written.
SHOPKO STORES, INC.
By: /s/ Dale P. Kramer
---------------------------
Dale P. Kramer, Chairman,
President and Chief
Executive Officer
Attest:
/s/ Richard D. Schepp
- -----------------------
Richard D. Schepp,
Secretary
U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /s/ Richard H. Prokosch
-------------------------
Richard H. Prokosch
Assistant Vice President
Attest:
/s/ C. Hatfield
- --------------------
C. Hatfield
STATE OF WISCONSIN )
) SS.:
COUNTY OF MILWAUKEE)
On the 22nd day of May, 1998, before
me personally came Dale P. Kramer, to me known, who,
being by me duly sworn, did depose and say that he is
Chairman, President and Chief Executive Officer of
ShopKo Stores, Inc., one of the corporations described
in and which executed the foregoing instrument; that
he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal;
that is was so affixed by authority of the Board of
Directors of said corporation, and that he signed his
name thereto by like authority.
/s/ Julie E. Hoberg
-----------------------------
My Commission Expires 6/18/00
STATE OF MINNESOTA )
) SS.:
COUNTY OF RAMSEY )
On the 22nd day of May, 1998, before me
personally came Richard H. Prokosch, to me known, who,
being by me duly sworn, did depose and say that he is
Assistant Vice President of U.S. Bank Trust National
Association, one of the corporations described in and
which executed the foregoing instrument; that he knows
the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that is was so
affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by
like authority.
/s/ Gina M. Vittori
-------------------------------
My Commission Expires 1/31/00
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of May
22, 1998, is between SHOPKO STORES, INC., a corporation
duly organized and existing under the laws of the state
of Wisconsin (herein called the "Company"), having its
principal office at 700 Pilgrim Way, Green Bay,
Wisconsin 54304 and U.S. BANK TRUST NATIONAL
ASSOCIATION (f/k/a First Trust National Association), a
national banking association duly organized and
existing under the laws of the United States, as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
Upon the merger of ShopKo Stores, Inc., a
corporation duly organized and existing under the laws
of the state of Minnesota (the "Predecessor"), with and
into the Company, the Company and the Trustee shall be
parties to an Indenture, dated as of March 12, 1992
(the "Indenture"), relating to the Company's 9.25%
Senior Notes due March 15, 2022. Capitalized terms
used herein and not otherwise defined shall have the
same meanings given to them in the Indenture.
The Company has requested the Trustee to join with
it in the execution and delivery of this First
Supplemental Indenture in order to supplement the
Indenture to permit the Predecessor to merge with and
into the Company.
Section 901 of the Indenture provides that a
supplemental indenture may be entered into by the
Company and the Trustee, without the consent of any
Holders, to evidence the succession of another Person
to the Predecessor and the assumption by any such
successor to the covenants of the Predecessor in the
Indenture and in the Securities.
The Company has determined that this First
Supplemental Indenture complies with said Section 901
and does not require the consent of any Holders.
The Company has furnished the Trustee with such
documents as may have been required by Section 801 of
the Indenture.
All things necessary to make this First
Supplemental Indenture a valid agreement of the Company
and the Trustee and a valid amendment of and supplement
to the Indenture have been done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises, it is
mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities,
or of series thereof, as follows:
The Company hereby expressly assumes the due and
punctual payment of the principal of and interest on
all the Securities and the performance or observance of
every covenant of the Indenture on the part of the
Predecessor to be performed or observed.
GENERAL PROVISIONS
The recitals contained herein shall be taken as
the statements of the Company, and the Trustee assumes
no responsibility for the correctness of the same. The
Trustee makes no representation as to the validity of
the First Supplemental Indenture. The Indenture, as
supplemented by this First Supplemental Indenture, is
in all respects hereby ratified and confirmed.
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed
to be an original, but all such counterparts shall
together constitute but one and the same instrument.
This First Supplemental Indenture shall be
governed by and construed in accordance with the laws
of the State of New York, but without regard to
principles of conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have caused
this First Supplemental Indenture to be duly executed,
and their respective corporate seals to be hereunto
affixed and attested, all as of the day and year first
above written.
SHOPKO STORES, INC.
By: /s/ Dale P. Kramer
----------------------------
Dale P. Kramer, Chairman,
President and Chief
Executive Officer
Attest:
/s/ Richard D. Schepp
- ----------------------
Richard D. Schepp,
Secretary
U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /s/ Richard H. Prokosch
-------------------------
Richard H. Prokosch
Assistant Vice President
Attest:
/s/ C. Hatfield
- -------------------
C. Hatfield
STATE OF WISCONSIN )
) SS.:
COUNTY OF MILWAUKEE)
On the 22nd day of May, 1998, before
me personally came Dale P. Kramer, to me known, who,
being by me duly sworn, did depose and say that he is
Chairman, President and Chief Executive Officer of
ShopKo Stores, Inc., one of the corporations described
in and which executed the foregoing instrument; that
he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal;
that is was so affixed by authority of the Board of
Directors of said corporation, and that he signed his
name thereto by like authority.
/s/ Julie E. Hoberg
-----------------------------
My Commission Expires 6/18/00
STATE OF MINNESOTA )
) SS.:
COUNTY OF RAMSEY )
On the 22nd day of May, 1998, before me
personally came Richard H. Prokosch, to me known, who,
being by me duly sworn, did depose and say that he is
Assistant Vice President of U.S. Bank Trust National
Association, one of the corporations described in and
which executed the foregoing instrument; that he knows
the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that is was so
affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by
like authority.
/s/ Gina M. Vittori
-----------------------------
My Commission Expires 1/31/00
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of May
22, 1998, is between SHOPKO STORES, INC., a corporation
duly organized and existing under the laws of the state
of Wisconsin (herein called the "Company"), having its
principal office at 700 Pilgrim Way, Green Bay,
Wisconsin 54304 and U.S. BANK TRUST NATIONAL
ASSOCIATION (f/k/a First Trust National Association), a
national banking association duly organized and
existing under the laws of the United States, as
Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
Upon the merger of ShopKo Stores, Inc., a
corporation duly organized and existing under the laws
of the state of Minnesota (the "Predecessor"), with and
into the Company, the Company and the Trustee shall be
parties to an Indenture, dated as of July 15, 1993 (the
"Indenture"), relating to the issuance from time to
time by the Company of its Securities on terms to be
specified at the time of issuance. Capitalized terms
used herein and not otherwise defined shall have the
same meanings given to them in the Indenture.
The Company has requested the Trustee to join with
it in the execution and delivery of this First
Supplemental Indenture in order to supplement the
Indenture to permit the Predecessor to merge with and
into the Company.
Section 901 of the Indenture provides that a
supplemental indenture may be entered into by the
Company and the Trustee, without the consent of any
Holders, to evidence the succession of another Person
to the Predecessor and the assumption by any such
successor to the covenants of the Predecessor in the
Indenture and in the Securities.
The Company has determined that this First
Supplemental Indenture complies with said Section 901
and does not require the consent of any Holders.
The Company has furnished the Trustee with such
documents as may have been required by Section 801 of
the Indenture.
All things necessary to make this First
Supplemental Indenture a valid agreement of the Company
and the Trustee and a valid amendment of and supplement
to the Indenture have been done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises, it is
mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities,
or of series thereof, as follows:
The Company hereby expressly assumes the due and
punctual payment of the principal of and interest on
all the Securities and the performance or observance of
every covenant of the Indenture on the part of the
Predecessor to be performed or observed.
GENERAL PROVISIONS
The recitals contained herein shall be taken as
the statements of the Company, and the Trustee assumes
no responsibility for the correctness of the same. The
Trustee makes no representation as to the validity of
the First Supplemental Indenture. The Indenture, as
supplemented by this First Supplemental Indenture, is
in all respects hereby ratified and confirmed.
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed
to be an original, but all such counterparts shall
together constitute but one and the same instrument.
This First Supplemental Indenture shall be
governed by and construed in accordance with the laws
of the State of New York, but without regard to
principles of conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have caused
this First Supplemental Indenture to be duly executed,
and their respective corporate seals to be hereunto
affixed and attested, all as of the day and year first
above written.
SHOPKO STORES, INC.
By: /s/ Dale P. Kramer
---------------------------
Dale P. Kramer, Chairman,
President and Chief
Executive Officer
Attest:
/s/ Richard D. Schepp
- --------------------------
Richard D. Schepp,
Secretary
U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /s/ Richard H. Prokosch
----------------------------
Richard H. Prokosch
Assistant Vice President
Attest:
/s/ C. Hatfield
- -------------------
C. Hatfield
STATE OF WISCONSIN )
) SS.:
COUNTY OF MILWAUKEE)
On the 22nd day of May, 1998, before me personally
came Dale P. Kramer, to me known, who, being by me duly
sworn, did depose and say that he is Chairman,
President and Chief Executive Officer of ShopKo Stores,
Inc., one of the corporations described in and which
executed the foregoing instrument; that he knows the
seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that is was so
affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by
like authority.
/s/ Julie E. Hoberg
-----------------------------
My Commission Expires 6/18/00
STATE OF MINNESOTA )
) SS.:
COUNTY OF RAMSEY )
On the 22nd day of May, 1998, before me
personally came Richard H. Prokosch, to me known, who,
being by me duly sworn, did depose and say that he is
Assistant Vice President of U.S. Bank Trust National
Association, one of the corporations described in and
which executed the foregoing instrument; that he knows
the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that is was so
affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by
like authority.
/s/ Gina M. Vittori
-----------------------------
My Commission Expires 1/31/00
AMENDMENT TO RIGHTS AGREEMENT
THIS AMENDMENT dated as of May 22, 1998 (the
"Amendment") to the Rights Agreement dated as of July
3, 1992, and amended and restated as of September 24,
1997 (the "Agreement"), is made between SHOPKO STORES,
INC., a Wisconsin corporation (the "Company"), and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION (the
"Rights Agent"). Capitalized terms used herein and not
otherwise defined shall have the meanings given to them
in the Agreement.
WHEREAS, the Company and ShopKo Stores, Inc., a
Minnesota corporation (the "Predecessor"), entered into
an Agreement and Plan of Merger dated as of March 31,
1998 whereby the Predecessor merged with and into the
Company (the "Merger") with the purpose and effect of
changing the Predecessor's state of incorporation from
Minnesota to Wisconsin; and
WHEREAS, the Board has determined to amend the
Agreement in several respects in accordance with
Section 27 thereof to reflect the effectuation of the
Merger and to implement such amendments by executing
this Amendment.
Accordingly, in consideration of the premises and
the mutual agreements herein set forth, the parties
hereby agree as follows:
1. All references in the Agreement and the
exhibits thereto to the "Company" shall be deemed to be
references to ShopKo Stores, Inc., a Wisconsin
corporation.
2. All references in the Agreement and the
exhibits thereto to the Minnesota Business Corporation
Act shall be deemed to be references to the Wisconsin
Business Corporation Law. Section 1(r) of the
Agreement is hereby amended by deleting "302A.601" and
inserting "180.1102" in place thereof. Section 16(d)
of the Agreement is hereby amended by deleting
"302A.409" and inserting "180.0627" in place thereof.
3. Section 31 of the Agreement is hereby amended
by deleting the word "Minnesota" in each place where it
occurs and inserting the word "Wisconsin" in place
thereof.
4. Exhibit A of the Agreement is hereby deleted
in its entirety and the Attachment to the Articles of
Incorporation of ShopKo Stores, Inc., a Wisconsin
corporation, a copy of which is attached hereto,
inserted in place thereof.
5. All references in the Agreement to the "Form
of Certificate of Designations" shall be deemed to be
reference to the Attachment to Articles of
Incorporation of ShopKo Stores, Inc., a Wisconsin
corporation.
6. All references in the exhibits to the
Agreement to the "Rights Agreement" shall be deemed to
be references to the Agreement as amended by this
Amendment.
This Amendment may be executed in any number of
counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed as of the day and
year first above written.
SHOPKO STORES, INC. NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By: /s/ Dale P. Kramer By: /s/ Ted Garrity
- ------------------------------------ ---------------------------
Name: Dale P. Kramer Name: Ted Garrity
Title: Chairman, President and Chief Title: Account Officer
Executive Officer
ATTACHMENT
TO THE
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
NEW SHOPKO, INC.
PREFERENCES, LIMITATIONS AND
RELATIVE RIGHTS OF THE SERIES B
JUNIOR PARTICIPATING PREFERRED STOCK
1. Dividends and Distributions.
(a) Subject to the rights of the holders of any
shares of any series of Preferred Stock (or any similar
stock) ranking prior and superior to the Series B
Junior Participating Preferred Stock (the "Series B
Preferred Stock") with respect to dividends, the
holders of shares of Series B Preferred Stock, in
preference to the holders of Common Stock, par value
$0.01 per share (the "Common Stock") of the Corporation
and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of
Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the
first day of March, June, September and December in
each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series B
Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (i) $10 or (ii)
subject to the provision for adjustment hereinafter set
forth, 1,000 times the aggregate per share amount of
all cash dividends, and 1,000 times the aggregate per
share amount (payable in kind) of all non-cash
dividends or other distributions, other than a dividend
payable in shares of Common Stock or a subdivision of
the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common
Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first
Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series
B Preferred Stock. In the event the Corporation shall
at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the amount to
which holders of shares of Series B Preferred Stock
were entitled immediately prior to such event under
clause (ii) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
(b) The Corporation shall declare a dividend or
distribution on the Series B Preferred Stock as
provided in paragraph (A) of this Section immediately
after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares
of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on
the Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $10 per
share on the Series B Preferred Stock shall
nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(c) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series B Preferred
Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares, unless the
date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless
the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the
determination of holders of shares of Series B
Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly
Dividend Payment Date. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares
of Series B Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record
date for the determination of holders of shares of
Series B Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which
record date shall be not more than 60 days prior to the
date fixed for the payment thereof.
2. Voting Rights. The holders of shares of
Series B Preferred Stock shall have the following
voting rights:
(a) Subject to the provision for adjustment
hereinafter set forth, each share of Series B Preferred
Stock shall entitle the holder thereof to 1,000 votes
on all matters submitted to a vote of the shareholders
of the Corporation. In the event the Corporation shall
at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series B
Preferred Stock were entitled immediately prior to such
event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after
such event and the denominator of which is the number
of shares of Common Stock that were outstanding
immediately prior to such event.
(b) Except as otherwise provided herein, in any
Articles of Amendment or such other similar document
creating a series of Preferred Stock or any similar
stock, or by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common
Stock and any other capital stock of the Corporation
having general voting rights shall vote together as one
class on all makers submitted to a vote of shareholders
of the Corporation.
(c) Except as set forth herein, or as otherwise
provided by law, holders of Series B Preferred Stock
shall have no special voting rights and their consent
shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
3. Certain Restrictions.
(a) Whenever quarterly dividends or other
dividends or distributions payable on the Series B
Preferred Stock as provided in Section C.1, above, are
in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared,
on shares of Series B Preferred Stock outstanding shall
have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Preferred
Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except dividends paid ratably on the Series B
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up), to the Series B Preferred
Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock
of the Corporation ranking junior (either as to
dividends or upon dissolution, liquidation or winding
up) to the Series B Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
or any shares of stock ranking on a parity with the
Series B Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend
rates and other relative rights and preferences of the
respective series and classes, shall determine in good
faith will result in fair and equitable treatment among
the respective series or classes.
(b) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under
paragraph (a) of this Section 3, purchase or otherwise
acquire such shares at such time and in such manner.
4. Reacquired Shares. Any shares of Series B
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired
and canceled promptly after the acquisition thereof.
All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and
may be reissued as part of a new series of Preferred
Stock subject to the conditions and restrictions on
issuance set forth herein, in the Articles of
Incorporation, or in any Articles of Amendment or such
other similar document creating a series of Preferred
Stock or any similar stock or as otherwise required by
law.
5. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (a) to the
holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding
up) to the Series B Preferred Stock unless, prior
thereto, the holders of shares of Series B Preferred
Stock shall have received $1,000 per share, plus an
amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the
date of such payment, provided that the holders of
shares of Series B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the
provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount to be distributed
per share to holders of shares of Common Stock, or (b)
to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except distributions made ratably on the Series
B Preferred Stock and all such parity stock in
proportion to the total amounts to which the holders of
all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation
shall at any time declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the aggregate amount to which holders of
shares of Series B Preferred Stock were entitled
immediately prior to such event under the proviso in
clause (b) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
6. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other
stock or securities, cash and/or any other property,
then in any such case each share of Series B Preferred
Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the
provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each
share of Common Stock is changed or exchanged. In the
event the Corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the amount set forth in the preceding
sentence with respect to the exchange or change of
shares of Series B Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
7. No Redemption. The shares of Series B
Preferred Stock shall not be redeemable.
8. Rank. The Series B Preferred Stock shall
rank, with respect to the payment of dividends and the
distribution of assets, junior to all series of any
other class of the Corporation's Preferred Stock.
ASSUMPTION AGREEMENT
Assumption Agreement (the "Assumption Agreement"),
dated as of May 22, 1998, made by ShopKo Stores, Inc.,
a Wisconsin corporation ("New ShopKo"), which is the
surviving corporation of the merger between New ShopKo
and ShopKo Stores, Inc., a Minnesota corporation ("Old
ShopKo"), for the benefit of the Agent and the Banks
which are parties to the Credit Agreement referred to
below. Capitalized terms used herein and not otherwise
defined shall have the meaning ascribed to such terms
in the Credit Agreement.
WITNESSETH:
WHEREAS, Old ShopKo, the Banks and Bankers Trust
Company, as Agent, entered into a Credit Agreement
dated as of July 8, 1997 (as modified, supplemented or
amended from time to time, the "Credit Agreement");
and
WHEREAS, Old ShopKo and New ShopKo entered into an
Agreement and Plan of Merger dated as of March 31, 1998
whereby Old ShopKo agreed to merge with and into New
ShopKo with the purpose and effect of changing the Old
ShopKo's state of incorporation from Minnesota to
Wisconsin (the "Reincorporation"); and
WHEREAS, the Reincorporation has been consummated
and, to comply with the requirements of Section 5.09(a)
of the Credit Agreement, New ShopKo desires to execute
and deliver this Assumption Agreement.
NOW, THEREFORE, for good and valuable
consideration the receipt and sufficiency of which is
hereby acknowledged by New ShopKo, New ShopKo hereby
agrees as follows:
1. New ShopKo hereby expressly assumes all
rights, obligations, duties and liabilities of Old
ShopKo under (i) the Credit Agreement and (ii) the
Letters of Credit issued thereunder.
2. New ShopKo hereby acknowledges and agrees
that all references in the Credit Agreement to the
"Borrower" shall be deemed to be references to New
ShopKo as the surviving corporation of the Merger.
3. New ShopKo hereby represents and warrants and
covenants to the Agent and the Banks as follows:
(a) on the date hereof and after giving
effect to the Reincorporation and the execution
and delivery of this Assumption Agreement, all
representations and warranties contained in the
Credit Agreement are true and correct in all
respects and no Default or Event of Default is in
existence; and
(b) on and after the date hereof, New
ShopKo, as the surviving corporation in the
Reincorporation, will fully and faithfully perform
all obligations (including payment obligations and
compliance with all covenants) (i) of the
"Borrower" under the Credit Agreement and the
Letters of Credit and (ii) under the Notes
delivered by New ShopKo pursuant to the Credit
Agreement.
4. This Assumption Agreement and the rights and
obligations of the parties hereunder shall be construed
in accordance with and governed by the laws of the
state of New York without giving effect to the conflict
of laws principles thereof.
5. This Assumption Agreement is made for the
benefit of the Agent and the Banks under the Credit
Agreement and may not be amended, modified or waived
without the consent of the Agent and the Banks.
6. This Assumption Agreement may be signed in
any number of counterparts, each of which shall be an
original, with the same effect as if the sigantures
were on the same instrument.
IN WITNESS WHEREOF, New ShopKo has caused this
Assumption Agreement to be duly executed and delivered
by its authorized officer as of the day and year first
above written.
SHOPKO STORES, INC.,
a Wisconsin corporation
By: /s/ Dale P. Kramer
------------------------
Name: Dale P. Kramer
Title: Chairman, President, and
Chief Executive Officer
Accepted by:
BANKERS TRUST COMPANY, as Agent
By: /s/ Mary Jo Jolly
------------------------
Name: Mary Jo Jolly
Title: Assistant Vice President
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT, is made as of May
22, 1998 by and between ShopKo Stores, Inc., a
Wisconsin corporation (the "Company"), and ____________
("Indemnitee").
WHEREAS, Indemnitee is a member of the Board of
Directors and/or an executive officer of the Company;
and
WHEREAS, it will be difficult to retain directors
and executive officers of the Company unless such
persons are adequately indemnified against liabilities
incurred and claims made in performance of their duties
as directors and/or executive officers of the Company;
and
WHEREAS, Article VII of the Company's By-laws (the
"By-laws") provides for the indemnification by the
Company of the officers and directors of the Company
and, as additional consideration for the services of
Indemnitee, the Company has obtained at its expense
directors' and officers' liability insurance ("D & O
Insurance") covering Indemnitee with respect to
Indemnitee's position with the Company; and
WHEREAS, to induce Indemnitee to continue to serve
as a member of the Board of Directors and/or as an
executive officer of the Company, the Company has
determined that it is in its best interests to assure
Indemnitee of the protection currently provided by the
By-laws and D & O Insurance and to indemnify Indemnitee
to the fullest extent permitted by the Wisconsin
Business Corporation Law (the "WBCL").
NOW, THEREFORE, in consideration of the premises
and the covenants contained herein, the Company and
Indemnitee do hereby covenant and agree as follows:
1. Indemnification. The Company agrees to
indemnify and hold Indemnitee harmless from and against
any and all claims, liabilities, damages, judgments,
penalties, fines, settlements, disbursements or
expenses of any type whatsoever (including, without
limitation, reasonable attorneys' fees) incurred by
Indemnitee in or arising out of (A) the status,
capacities or activities of Indemnitee as a director
and/or an executive officer of the Company, or (B) the
status, capacities or activities of Indemnitee with any
Subsidiary (as hereinafter defined) which status,
capacities or activities with such Subsidiary were
undertaken in connection with the Indemnitee's position
with the Company as a director and/or an executive
officer, in each case to the maximum extent permitted
under Subchapter VIII of the WBCL and Article VII of
the By-laws as in effect on the date hereof and as
either may be amended to provide more advantageous
rights to the Indemnitee. For purposes hereof,
"Subsidiary" means any corporation, joint venture,
limited liability company, or other business entity in
which the Company has a significant direct or indirect
equity interest.
2. Advances of Expenses. Upon written request by
Indemnitee and subject to the requirements of the WBCL,
the Company shall advance all expenses incurred by
Indemnitee in connection with the investigation,
defense, settlement or appeal of any proceeding, action
or investigation to which Indemnitee is a party or is
threatened to be made a party arising out of any matter
for which the Indemnitee is entitled to indemnification
pursuant to Section 1 hereof to the maximum extent
permitted under Subchapter VIII of the WBCL and Article
VII of the By-laws as in effect on the date of this
Agreement and as either may be amended to provide more
advantageous rights to the Indemnitee. The
indemnification provisions contained in Subchapter VIII
of the WBCL and Article VII of the By-laws, as in
effect on the date hereof and as either may be amended
to provide more advantageous indemnification rights to
Indemnitee, shall be deemed to be a contract between
the Company and Indemnitee and any amendment,
modification, revocation or repeal of any such
provisions of Subchapter VIII of the WBCL or Article
VII of the By-laws shall not limit any rights of
Indemnitee hereunder to indemnification or the
allowance of expenses.
3. Other Rights of Director. The right of
Indemnitee to indemnification or advance of expenses
pursuant to this Agreement shall not be exclusive of
other rights Indemnitee may have (i) under applicable
law, (ii) pursuant to other agreements between the
Company and Indemnitee or the By-laws, or (iii)
pursuant to any agreement with a third party (by way of
insurance, indemnification or otherwise).
4. Absolute Right to Indemnification and
Advancement of Expenses. The Company agrees that it
shall not, and the Company hereby waives all rights
that it has or may have to refuse to indemnify, or
withhold payment of amounts for which Indemnitee is
indemnified hereunder, based on any breach or alleged
breach of any of the provisions of this Agreement by
Indemnitee or for any other reason whatsoever;
provided, however, that the Agreement shall not require
the Company to make any payment prohibited by law, or
to advance expenses contrary to the provisions hereof.
In the event Indemnitee is required to bring any action
to enforce Indemnitee's rights or to collect monies due
to Indemnitee under this Agreement, and is successful
in such action, the Company shall reimburse Indemnitee
for all of Indemnitee's legal fees and expenses in
bringing and pursuing such action.
5. Amendments to Wisconsin WBCL or Company's
Articles or By-laws. The Company shall not amend its
Articles of Incorporation ("Articles") or By-laws to
reduce or eliminate the Indemnitee's right to
indemnification or advances provided for under this
Agreement. Any amendments to the Articles or By-laws
made subsequent to the date of this Agreement which
reduce or eliminate rights of persons entitled to
indemnification or advances under such Articles or By-
laws shall not limit the rights of Indemnitee pursuant
to this Agreement. If the WBCL, the Articles or the By-
laws are amended so as to provide for greater
indemnification rights or benefits, Indemnitee shall be
entitled to such greater rights and benefits
immediately upon such amendment. Subsequent amendments
to the WBCL or other applicable law shall in no way
reduce Indemnitee's rights under this Agreement.
6. Maintenance of Insurance. The Company
represents that it presently has in force and effect
directors and officers insurance under a directors' and
officers' liability insurance policy covering certain
liabilities which may be incurred by its officers and
directors. The Company agrees to purchase and maintain
in effect, for the benefit of Indemnitee, D & O
Insurance providing, in all respects, coverage not less
favorable than that presently provided pursuant to said
policy for so long as Indemnitee shall serve as
director and/or executive officer and until the later
of (i) three years after Indemnitee ceases to be a
director and/or executive officer, as the case may be,
for any reason, or (ii) for so long as Indemnitee shall
be subject to any possible claim or threatened, pending
or completed action, suit or proceeding, whether civil,
criminal or investigative, by reason of the fact that
Indemnitee was a member of the Board of Directors
and/or an executive officer, as the case may be. The
unavailability or subsequent exclusions, limitations or
deductibles contained in coverage provided by such
D & O Insurance shall in no way limit the obligations
of the Company to insure and indemnify Indemnitee to
the full extent required by this Agreement.
7. Effect of Certain Proceedings. The termination
of any proceeding or of any claim, issue or matter
therein, by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, does
not of itself adversely affect the right of Indemnitee
to indemnification hereunder or create a presumption
that indemnification is not required. The knowledge
and/or actions, or failure to act, of any director,
officer, agent or employee of the Company shall not be
imputed to Indemnitee for purposes of determining the
right to indemnification under this Agreement.
8. Notification. Promptly after receipt by
Indemnitee or the Company of any notice or document
respecting the commencement of any action, suit,
proceeding or investigation naming or involving
Indemnitee and relating to any matter concerning which
Indemnitee may be entitled to indemnification or
advances pursuant to this Agreement, the party
receiving notice will notify the other of the receipt
of same, but the failure by Indemnitee to so notify the
Company shall not relieve the Company from any
obligation under this Agreement or otherwise.
9. Amendment. This Agreement may be amended at
any time by written instrument executed by the Company
and Indemnitee.
10. Notices. All notices and other
communications between the parties with respect to this
Agreement must be made in writing and shall be deemed
to have been fully delivered as of the date on which
they are hand delivered or deposited in the United
States mail for delivery by registered or certified
mail, postage and fees prepaid.
11. Binding Effect. Due to the personal nature
of the services to be rendered by Indemnitee,
Indemnitee may not assign this Agreement. Subject to
the foregoing, the provisions of this Agreement are
binding upon and inure to the benefit of (i) Indemnitee
and Indemnitee's respective heirs, legal
representatives and administrators, and (ii) the
Company and its successors, transferees and assigns.
12. Term of Agreement. This Agreement shall
continue and terminate upon the later of: (i) 10 years
after the date that Indemnitee shall have ceased to
serve as a director and/or executive officer of the
Company; or (ii) the final termination of all pending
proceedings in respect of which Indemnitee is granted
rights of indemnification or advancement of expenses
hereunder and of any proceeding commenced by Indemnitee
pursuant to Section 14 of this Agreement relating
thereto.
13. Validity. The invalidity or unenforceability
of any provision of the Agreement shall not affect the
validity or enforceability of any other provision of
this Agreement, which shall remain in full force and
effect.
14. Arbitration. Any dispute or controversy
arising under or in connection with this Agreement
shall be discussed between the parties in a good faith
effort to arrive at a mutual settlement of any such
controversy. If, notwithstanding the parties' good
faith efforts, a dispute remains unresolved for a
period of 45 days after initial notice from one party
to the other of the dispute, the parties shall submit
such dispute to arbitration in accordance with the
rules of the American Arbitration Association, and
judgment upon the award may be entered in any court
having jurisdiction over the controversy. The costs of
the proceedings shall be paid by the Company. Unless
otherwise agreed upon, the place of arbitration
proceedings shall be Brown County, Wisconsin.
15. Subrogation. In the event of payment by the
Company to Indemnitee under this Agreement, the Company
shall be subrogated to the extent of such payment to
all of the rights of recovery of Indemnitee, and
Indemnitee shall execute all documents and shall do all
things necessary to enable the Company effectively to
bring suit to enforce such rights.
16. Governing Law. This Agreement shall be
governed by and construed in accordance with the laws
of the State of Wisconsin.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
SHOPKO STORES, INC.
______________________ By:_____________________
INDEMNITEE Its
