<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 8, 1996
REGISTRATION STATEMENT NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
SEARS ROEBUCK ACCEPTANCE CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<CAPTION>
DELAWARE 51-0080535
<S> <C>
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>
3711 KENNETT PIKE
GREENVILLE, DELAWARE 19807
(302) 888-3100
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
SEARS, ROEBUCK AND CO.
(EXACT NAME OF CO-REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<CAPTION>
NEW YORK 36-1750680
<S> <C>
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>
3333 BEVERLY ROAD
HOFFMAN ESTATES, ILLINOIS 60179
(847) 286-2500
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF CO-REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
<TABLE>
<S> <C>
KEITH E. TROST MICHAEL D. LEVIN, ESQ.
PRESIDENT SENIOR VICE PRESIDENT, GENERAL COUNSEL
SEARS ROEBUCK ACCEPTANCE CORP. AND SECRETARY
3711 KENNETT PIKE SEARS, ROEBUCK AND CO.
GREENVILLE, DELAWARE 19807 3333 BEVERLY ROAD
(302) 888-3100 HOFFMAN ESTATES, ILLINOIS 60179
(847) 286-2500
</TABLE>
(NAMES, ADDRESSES, INCLUDING ZIP CODE, AND TELEPHONE NUMBERS, INCLUDING AREA
CODE, OF AGENTS FOR SERVICE)
COPIES TO:
<TABLE>
<S> <C> <C>
RICHARD F. KOTZ, ESQ. VENRICE R. PALMER, ESQ. CARL E. WITSCHY, ESQ.
SECRETARY SENIOR COUNSEL LATHAM & WATKINS
SEARS ROEBUCK ACCEPTANCE CORP. SEARS, ROEBUCK AND CO. 233 S. WACKER DRIVE, SUITE 5800
3711 KENNETT PIKE 3333 BEVERLY ROAD CHICAGO, ILLINOIS 60606
GREENVILLE, DELAWARE 19807 HOFFMAN ESTATES, ILLINOIS 60179
</TABLE>
--------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement as determined by
market conditions.
--------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED
MAXIMUM PROPOSED
OFFERING MAXIMUM
AMOUNT PRICE AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED UNIT (1) PRICE (1) FEE
<S> <C> <C> <C> <C>
Debt Securities.................................... $4,000,000,000 100% $4,000,000,000 $1,379,310.00
</TABLE>
(1) Pursuant to Rule 429, the prospectus included in this registration statement
is a combined prospectus and also relates to Debt Securities having an
aggregate initial offering price not in excess of $753,750,000 which have
not yet been offered for sale under the original Registration Statement No.
33-64215 on Form S-3. A filing fee of $689,655.17 was paid with respect to
the $2,000,000,000 amount of Debt Securities registered pursuant to
Registration Statement No. 33-64215, of which $259,913.79 represented the
filing fee associated with the amount of such Debt Securities which has not
yet been offered for sale.
THE REGISTRANT AND CO-REGISTRANT HEREBY AMEND THIS REGISTRATION STATEMENT ON
SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE
REGISTRANT AND CO-REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN
ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SEARS ROEBUCK ACCEPTANCE CORP.
DEBT SECURITIES
---------------
Sears Roebuck Acceptance Corp. ("SRAC") from time to time may offer up to
$4,753,750,000 aggregate initial offering price of its debt securities
consisting of debentures, notes and/or other unsecured evidences of indebtedness
(the "Debt Securities"). If so provided in the accompanying Prospectus
Supplement, the Debt Securities of any series may be represented in whole or in
part by one or more Global Securities ("Global Securities") registered in the
name of a depository's nominee and, if so represented, beneficial interests in
such Global Securities will be shown on, and transfers thereof will be effected
only through, records maintained by the depository and its participants. The
Debt Securities may be offered as separate series in amounts, at prices and on
terms to be set forth in supplements to this Prospectus. It is anticipated that
SRAC will sell Debt Securities directly to institutional investors and may sell
Debt Securities to or through underwriters, and also may sell Debt Securities
directly to other purchasers or through agents. See "Plan of Distribution." The
accompanying Prospectus Supplement or Prospectus Supplements (the "Prospectus
Supplement") sets forth the names of any underwriters or agents involved in the
sale of the Debt Securities in respect of which this Prospectus is being
delivered, the principal amounts, if any, to be purchased by underwriters and
the compensation, if any, of such underwriters or agents.
The terms of the Debt Securities, including, where applicable, the specific
designation, aggregate principal amount, denominations, maturity, premium, if
any, rate (which may be fixed or variable) and time of payment of interest, if
any, terms for redemption at the option of SRAC or the Holder, terms for sinking
fund payments, the initial public offering price, the names of, and the
principal amounts, if any, to be purchased by underwriters and the compensation
of such underwriters, deferred pricing arrangements, if any, and the other terms
in connection with the offering and sale of the Debt Securities in respect of
which this Prospectus is being delivered, are set forth in the accompanying
Prospectus Supplement.
As used herein, Debt Securities shall include securities denominated in U.S.
dollars or, at the option of SRAC if so specified in the applicable Prospectus
Supplement, in any other currency or in composite currencies or in amounts
determined by reference to an index.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
, 1996
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH IT
RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY
SINCE THE DATE HEREOF OR THAT THE INFORMATION IS CORRECT AS OF ANY TIME
SUBSEQUENT TO ITS DATE.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Available Information.................................................................. 3
Reports to Holders of Debt Securities.................................................. 3
Incorporation of Certain Documents by Reference........................................ 3
Sears Roebuck Acceptance Corp.......................................................... 4
Use of Proceeds........................................................................ 4
Summary Financial Information.......................................................... 5
Ratio of Earnings to Fixed Charges..................................................... 6
Description of Debt Securities......................................................... 6
Plan of Distribution................................................................... 10
Legal Opinion.......................................................................... 10
Experts................................................................................ 10
</TABLE>
2
<PAGE>
AVAILABLE INFORMATION
SRAC and Sears, Roebuck and Co. ("Sears"), SRAC's parent, are subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and in accordance therewith file reports and other
information with the Securities and Exchange Commission (the "Commission").
Sears also files proxy statements with the Commission. Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the Commission, at Room 1024, 450 Fifth Street N.W.,
Washington, D.C. 20549; 7 World Trade Center, Suite 1300, New York, New York
10048; and Suite 1400, Citicorp Center, 500 W. Madison Street, Chicago, Illinois
60661-2511; and copies of such materials can be obtained from the public
reference section of the Commission, 450 Fifth Street N.W., Washington, D.C.
20549, at prescribed rates.The Commission also maintains a Web Site that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission
(http://www.sec.gov). Reports and other information concerning SRAC can also be
inspected at the office of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005. Reports, proxy statements and other information
concerning Sears can also be inspected at the offices of the New York Stock
Exchange, Inc., the Chicago Stock Exchange Incorporated, 440 South LaSalle
Street, Chicago, Illinois 60605, and the Pacific Stock Exchange, Inc., 301 Pine
Street, San Francisco, California 94104.
Additional information regarding SRAC, Sears and the Debt Securities is
contained in the Registration Statement and the exhibits relating thereto, filed
with the Commission under the Securities Act of 1933, as amended (the "Act").
For further information pertaining to SRAC, Sears and the Debt Securities,
reference is made to the Registration Statement, and the exhibits thereto, which
may be inspected without charge at the office of the Commission at 450 Fifth
Street N.W., Washington, D.C. 20549, and copies thereof may be obtained from the
Commission at prescribed rates.
REPORTS TO HOLDERS OF DEBT SECURITIES
Holders of Debt Securities will receive annual reports containing
information, including financial information that has been audited and reported
on by independent public accountants, about SRAC.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Annual Reports on Form 10-K for the year ended December 30, 1995 filed
by SRAC and Sears, the Quarterly Reports on Form 10-Q for the quarterly period
ended March 30, 1996 filed by SRAC and Sears, and the Current Reports on Form
8-K for February 7 and July 18, 1996 filed by Sears and for January 23, March 26
and June 28, 1996 filed by SRAC with the Commission pursuant to Section 13 of
the Exchange Act, are incorporated in and made part of this Prospectus by
reference.
All documents filed by SRAC or Sears with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering of the Debt
Securities (other than those portions of such documents described in paragraphs
(i), (k) and (l) of Item 402 of Regulation S-K promulgated by the Commission)
shall be deemed to be incorporated by reference in this Prospectus and to be a
part hereof from the date of filing of such documents.
SRAC WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL OF THE DOCUMENTS INCORPORATED HEREIN BY REFERENCE (NOT
INCLUDING EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE SPECIFICALLY
INCORPORATED BY REFERENCE IN SUCH DOCUMENTS). WRITTEN OR TELEPHONE REQUESTS FOR
SUCH COPIES SHOULD BE DIRECTED TO SEARS ROEBUCK ACCEPTANCE CORP., 3711 KENNETT
PIKE, GREENVILLE, DELAWARE 19807, ATTENTION: VICE PRESIDENT, FINANCE
(302/888-3100).
3
<PAGE>
SEARS ROEBUCK ACCEPTANCE CORP.
SRAC is a wholly-owned finance subsidiary of Sears and was incorporated in
1956 under the laws of Delaware. Its general offices are located at 3711 Kennett
Pike, Greenville Delaware 19807 (302/888-3100). SRAC raises funds primarily from
the direct placement of commercial paper with corporate and institutional
investors and through intermediate-term loans, discrete underwritten debt and
medium-term notes. SRAC uses borrowing proceeds to acquire short-term notes of
Sears and purchase outstanding customer receivable balances from Sears. Sears,
which is a multi-line retailer that conducts Domestic and International
merchandising operations, uses the funds obtained from SRAC for general funding
purposes. SRAC, and not Sears, will be the sole obligor on the Debt Securities.
SRAC's income is derived primarily from the earnings on its investment in
the notes and receivable balances of Sears. The interest rate on Sears notes is
presently calculated so that SRAC maintains an earnings to fixed charge ratio of
at least 1.25. The yield on the investment in Sears notes is related to SRAC's
borrowing costs and, as a result, SRAC's earnings fluctuate in response to
movements in interest rates and changes in Sears short-term borrowing
requirements. Subject to the provisions of the Indenture relating to the Debt
Securities, SRAC will be required to maintain a ratio of earnings to fixed
charges (determined in accordance with Item 503(d) of Regulation S-K promulgated
by the Commission) of not less than 1.10 for any fiscal quarter and cause Sears
to maintain ownership of all voting stock of SRAC as long as any Debt Securities
are outstanding, and Sears has agreed to pay SRAC such amounts as may be
necessary for such purpose and to maintain such ownership. See "Description of
Debt Securities."
At July 31, 1996, SRAC had ten employees.
USE OF PROCEEDS
The net proceeds to be received by SRAC from the sale of the Debt Securities
offered hereby will be added to its general funds and initially used to reduce
short-term indebtedness. As indicated under "Sears Roebuck Acceptance Corp.,"
SRAC's principal business is the purchase of short-term notes of Sears; also, on
occasion, SRAC purchases customer receivable balances from Sears Domestic credit
operations. SRAC expects to incur additional indebtedness, but the amount and
nature thereof have not yet been determined and will depend on economic
conditions and certain capital requirements of Sears. It is anticipated that
Sears and its subsidiaries will continue their practice of short-term borrowing
and will, from time to time, incur additional long-term debt and engage in
securitization programs in which credit card receivables are sold in public or
private transactions. Sears also may, from time to time, issue equity
securities.
4
<PAGE>
SUMMARY FINANCIAL INFORMATION
The following table sets forth certain summary financial information of SRAC
for the five fiscal years ended December 30, 1995. The summary information
should be read in conjunction with the financial statements of SRAC and the
notes thereto incorporated herein by reference.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
---------- ---------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C>
(DOLLARS IN MILLIONS)
OPERATING RESULTS
Total revenues................................... $ 510.3 $ 282.7 $ 337.5 $ 696.5 $ 1,100.8
Expenses
Interest and related expenses.................. 404.6 218.5 236.1 482.8 825.9
Total Expenses................................. 407.0 220.4 276.7 532.3 894.1
Income taxes..................................... 36.2 22.1 21.3 56.1 70.3
Net income....................................... 67.1 40.2 39.5 108.1 136.4
FINANCIAL POSITION
Assets
Notes of Sears................................. $ 8,396.4 $ 6,842.5 $ 3,403.9 $ 10,493.6 $ 12,214.5
Customer receivable balances purchased from
Sears........................................ 81.2 81.5 88.0 963.4 1,042.8
Total assets................................... 8,634.3 7,031.2 4,145.8 12,415.2 14,676.2
Liabilities
Commercial paper............................. $ 4,450.6 $ 4,912.9 $ 2,475.0 $ 8,515.3 $ 10,205.8
Agreements with bank trust departments....... 137.0 87.4 139.8 397.9 510.1
Intermediate-term loans........................ 895.0 845.0 -- -- 204.0
Medium-term notes.............................. 1,383.5 -- -- -- --
Discrete underwritten debt..................... 498.9 -- -- -- --
Loan agreements with SOFNV..................... -- -- 379.8 332.1 683.2
Total liabilities.............................. 7,389.5 5,853.5 3,008.3 9,287.0 11,656.1
Sears, Roebuck and Co. investment in SRAC
Capital stock (including capital in excess of
par value)................................... 35.0 35.0 35.0 365.2 365.2
Retained income................................ 1,209.8 1,142.7 1,102.5 2,763.0 2,654.9
Debt as percentage of equity..................... 592% 496% 263% 296% 384%
OTHER PERTINENT DATA
Commercial paper
Average daily outstandings..................... $ 4,963 $ 3,615 $ 3,812 $ 9,328 $ 10,543
Agreements with bank trust departments Average
daily outstandings............................. 154 124 402 747 643
Total credit facilities (year-end)............... 5,720 5,132 4,200 10,812 11,801
</TABLE>
5
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for SRAC for the quarter ended March
30, 1996 and for each of the years ended December 30, 1995, and December 31,
1994, 1993, 1992 and 1991 was 1.26, 1.26, 1.29, 1.26, 1.34 and 1.25,
respectively. Earnings consist of net income plus fixed charges and income
taxes. Fixed charges consist of interest costs and amortization of debt discount
and expense; rental expense is insignificant with no effect on the calculation.
The interest rate paid by Sears to SRAC on its investment in Sears notes is
presently calculated to produce earnings sufficient to cover SRAC's fixed
charges at least 1.25 times.
The ratio of income to fixed charges for Sears and its consolidated
subsidiaries for each of the fiscal years ended December 30, 1995, and December
31, 1994, 1993, and 1991 was 2.15, 2.06, 1.66 and 1.16, respectively, and for
the three- and twelve-month periods ended March 30, 1996 was 1.65 and 2.16,
respectively. For the year ended December 31, 1992, earnings did not cover fixed
charges by $2,869 million. In the computation of the ratio of income to fixed
charges for Sears and its consolidated subsidiaries, income consists of income
from continuing operations less undistributed net income of unconsolidated
subsidiaries plus fixed charges (excluding capitalized interest) and federal and
state income taxes. Fixed charges consist of interest costs plus the portion of
operating lease rentals which is estimated to represent the interest element in
such rentals.
DESCRIPTION OF DEBT SECURITIES
The following descriptions of the terms of the Debt Securities set forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement (the "Offered Debt Securities") and the
extent, if any, to which such general provisions may apply to the Debt
Securities so offered will be described in the Prospectus Supplement relating to
such Offered Debt Securities.
The Debt Securities are to be issued under one of the Indentures (each, an
"Indenture") referred to in the following sentence, a copy of the form of which
has been filed as an exhibit to the Registration Statement. SRAC has entered
into an Indenture with The Chase Manhattan Bank, N.A., as Trustee, and may enter
into Indentures with one or more other Trustees eligible to act as Trustee under
an Indenture pursuant to the Trust Indenture Act of 1939, as amended (each, a
"Trustee"). The particular Indenture under which any series of Debt Securities
is to be issued, and the identity of the Trustee under such Indenture, will be
identified in the Prospectus Supplement relating to such series of Debt
Securities. The following summaries of certain provisions of the Debt Securities
and the Indenture do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all the provisions of the
Indenture, including the definitions therein of certain terms. Whenever
particular provisions or defined terms in the Indenture are referred to herein,
such provisions or defined terms are incorporated by reference.
GENERAL
The Debt Securities will be unsecured obligations of SRAC.
The Indenture does not limit the amount of Debt Securities that may be
issued thereunder and provides that Debt Securities may be issued thereunder
from time to time in one or more series.
Reference is made to the Prospectus Supplement relating to the particular
series of Offered Debt Securities offered thereby for the following terms of the
Offered Debt Securities: (i) the title of the Offered Debt Securities; (ii) any
limit on the aggregate principal amount of the Offered Debt Securities; (iii)
the date or dates on which the Offered Debt Securities will mature; (iv) the
price (expressed as a percentage
6
<PAGE>
of the aggregate principal amount thereof) at which the Offered Debt Securities
will be issued; (v) the rate or rates (which may be fixed or variable) per annum
at which the Offered Debt Securities will bear interest, if any; (vi) the date
from which such interest, if any, on the Offered Debt Securities will accrue,
the dates on which such interest, if any, will be payable, the date on which
payment of such interest, if any, will commence and the Regular Record Dates for
such Interest Payment Dates, if any; (vii) the date or dates, if any, after or
on which and the price or prices at which the Offered Debt Securities may,
pursuant to any optional or mandatory redemption, conversion or exchange
provisions, be redeemed, converted or exchanged at the option of SRAC or of the
Holder thereof and the other detailed terms and provisions of such optional or
mandatory redemption; (viii) any subordination provisions; (ix) the dates, if
any, on which and the price or prices at which the Offered Debt Securities will,
pursuant to any mandatory sinking fund provisions, or may, pursuant to any
optional sinking fund provisions, be redeemed by SRAC, and the other detailed
terms and provisions of such sinking fund; (x) if other than the principal
amount thereof, the amount of Offered Debt Securities which shall be payable
upon declaration of acceleration of the Maturity thereof; (xi) the terms of any
warrants attached to the Offered Debt Securities; (xii) the currency or
currencies, including European Currency Units or other composite currencies, in
which Offered Debt Securities may be purchased and in which principal, premium,
if any, and interest, if any, on the Offered Debt Securities will be payable;
(xiii) any index used to determine the amount of payments of principal, premium,
if any, and interest, if any, on the Offered Debt Securities; (xiv) whether the
Offered Debt Securities are issuable in whole or in part as one or more Global
Securities and, in such case, the name of the Depository for such Global
Security or Global Securities; (xv) the place or places, if other than as set
forth in the Indenture, where the principal, premium, if any, and interest, if
any, on the Offered Debt Securities will be payable; and (xvi) any other terms
relating to the Offered Debt Securities not inconsistent with the Indenture but
which may modify or delete any provision of the Indenture insofar as it applies
to such series; provided that no term thereof shall be modified or deleted if
imposed under the Trust Indenture Act and that any modification or deletion of
the rights, duties or immunities of the Trustee shall have been consented to in
writing by the Trustee.
Principal, premium, if any, and interest, if any, will be payable, and the
Debt Securities (other than Debt Securities represented by Global Securities)
will be transferable, at the office or agency of SRAC maintained for such
purposes in the Borough of Manhattan of The City of New York, and at such other
places, if any, in the city in which the principal executive offices of SRAC or
the city in which the principal corporate trust office of the Trustee are
located, as SRAC may designate, which, except as otherwise specified in the
Prospectus Supplement relating to a particular series of Offered Debt
Securities, will initially include the principal corporate trust office of the
Trustee in the Borough of Manhattan of The City of New York and the principal
executive offices of SRAC in Greenville, Delaware. Unless other arrangements are
made, interest on the Debt Securities (other than Debt Securities represented by
Global Securities) will be paid by checks mailed to the Holders at their
registered addresses. (SECTIONS 1.1, 2.5, 3.1, 3.2) Information with respect to
payment of principal, premium, if any, and interest, if any, on, and transfers
of beneficial interests in, Debt Securities represented by Global Securities
will be set forth in the Prospectus Supplement relating thereto.
If the principal, premium, if any, and interest, if any, will be payable in
a currency other than U.S. dollars, including European Currency Units or another
composite currency, and such currency is not available for payment due to the
imposition of exchange controls or other circumstances beyond the control of
SRAC, SRAC shall satisfy its payment obligations in U.S. dollars on the basis of
the Market Exchange Rate for such currency on the latest date for which such
rate was established on or before the date on which payment is due. (SECTION
2.12)
Unless otherwise indicated in the Prospectus Supplement relating thereto,
the Debt Securities will be issued only in fully registered form, without
coupons, in denominations of $1,000 or any integral multiple thereof. No service
charge will be made for any registration of transfer or exchange of the Offered
Debt Securities, but SRAC may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. (SECTIONS 2.2,
2.5)
7
<PAGE>
Debt Securities may be issued under the Indenture as Original Issue Discount
Securities to be offered and sold at a substantial discount below their stated
principal amount. Federal income tax consequences and other special
considerations applicable to any such Original Issue Discount Securities will be
described in the Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security which provides for an amount less than the
principal amount thereof to be due and payable upon the declaration of
acceleration of the Maturity thereof upon the occurrence of a default and the
continuation thereof. (SECTIONS 1.1, 6.1)
CERTAIN RESTRICTIONS
The Indenture provides that SRAC will maintain a Fixed Charge Coverage Ratio
for any fiscal quarter of not less than 1.10 and that SRAC will cause Sears to
maintain ownership of all the voting stock of SRAC. "Fixed Charge Coverage
Ratio" means SRAC's ratio of earnings to fixed charges determined in accordance
with Item 503(d) of Regulation S-K promulgated by the Commission, as in effect
on the date of the Indenture. Pursuant to letter agreements between SRAC and
Sears (the "Fixed Charge Coverage and Ownership Agreement"), Sears has agreed,
for the benefit of holders of outstanding Debt Securities, that, (i) as long as
SRAC is so required to maintain such Fixed Charge Coverage Ratio, Sears will pay
SRAC such amounts which, together with any other earnings available therefor,
are sufficient for SRAC to maintain such Fixed Charge Coverage Ratio and (ii) as
long as SRAC is so required to cause Sears to maintain ownership of SRAC, Sears
will maintain such ownership. The Indenture provides that SRAC (i) will cause
Sears to observe and perform in all material respects all covenants or
agreements of Sears contained in the Fixed Charge Coverage and Ownership
Agreement and (ii) will not amend, waive, terminate or otherwise modify any
provision of the Fixed Charge Coverage and Ownership Agreement. (SECTIONS 1.1,
3.6)
DEFAULTS
The following are defaults with respect to any series of Debt Securities:
(a) failure to pay the principal amount (and premium, if any) on such series
when due and payable; (b) failure to pay any interest on such series when due,
continued for 30 days (unless the entire amount of such payment is deposited by
SRAC with the Trustee or with a paying agent prior to the expiration of 30
days); (c) failure to perform any other covenant of SRAC in the Indenture (other
than a covenant included in the Indenture solely for the benefit of any series
of Debt Securities other than that series), continued for 60 days after written
notice; (d) acceleration of $100,000,000 or more in principal amount of
indebtedness for borrowed money of SRAC (including acceleration with respect to
Debt Securities other than that series) or Sears under the terms of the
instrument under which such indebtedness is issued or secured (including the
Indenture), if such indebtedness shall not have been discharged or such
acceleration is not annulled within 30 days after written notice or prior to the
time principal owed on the outstanding Debt Securities of that series shall be
declared due and payable, except as a result of compliance with applicable laws,
orders or decrees; and (e) certain events of bankruptcy, insolvency, or
reorganization. In addition, a particular series of Debt Securities may provide
for additional events of default, as may be described in the Prospectus
Supplement. If a default shall occur and be continuing with respect to any
series of Debt Securities, the Trustee or the Holders of a majority in principal
amount of the outstanding Debt Securities of that series may declare the
principal amount of such series (or, if the Debt Securities of that series are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of that series) due and payable immediately, which
declaration may, in certain instances, be annulled by the Holders of a majority
of the principal amount of outstanding Debt Securities of that series. In the
case of such declaration, there would become due and payable such principal
amount plus any accrued interest or other periodic payments. (SECTION 6.1)
No Holder of any Debt Security of any series will have any right to
institute any proceeding with respect to the Indenture or for any remedy
thereunder, unless such Holder previously shall have given to the Trustee
written notice of a default and unless also the Holders of a majority of the
principal amount of
8
<PAGE>
outstanding Debt Securities of that series shall have made written request upon
the Trustee, offering reasonable indemnity, to institute such proceeding as
Trustee, and the Trustee shall have neglected or refused to institute such
proceeding within a reasonable time. However, the right of any Holder of any
Debt Security of that series to enforce the payment of principal and interest on
such Debt Security, on or after the due dates expressed in such Debt Security,
may not be impaired or affected. (SECTION 6.7)
SRAC is required to furnish annually to the Trustee statements as to the
performance or fulfillment of its covenants, agreements or conditions in the
Indenture and as to the absence of default. (SECTION 3.4)
MODIFICATION OR AMENDMENT OF THE INDENTURE
Modifications and alterations of the Indenture may be made by SRAC with the
consent of the Holders of a majority of the aggregate principal amount of the
outstanding Debt Securities of each series affected by the modification or
alteration, provided that no such change shall be made without the consent of
the Holders of each Debt Security then outstanding affected thereby which will
(a) permit the extension of the time of payment of any payment on any such Debt
Security, or a reduction in any such payment or (b) reduce the above-stated
percentage of Holders of any series of Debt Securities whose consent is required
to modify or alter the Indenture. (ARTICLE XI)
DEFEASANCE
Unless otherwise provided for in the accompanying Prospectus Supplement,
SRAC may discharge the Indenture with respect to Debt Securities of any series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, replace mutilated, destroyed, lost and stolen Debt
Securities of such series, maintain paying agencies and hold moneys for payment
in trust) upon the deposit with the Trustee or a paying agent, in trust, of (1)
money in an amount sufficient, or (2) U.S. Government Obligations (if the Debt
Securities are denominated in U.S. dollars) or Eligible Obligations (if the Debt
Securities are denominated in a Foreign Currency) which through the payment of
interest and principal in respect thereof in accordance with their terms will
provide money in an amount sufficient, or (3) any combination thereof in an
amount sufficient, to pay the principal, premium, if any, and each installment
of interest on the Debt Securities of such series on the dates such payments are
due in accordance with the terms of the Indenture and such Debt Securities. Such
a trust may only be established if, among other things, SRAC has received a
ruling from the Internal Revenue Service or an opinion of recognized counsel who
is not an employee of SRAC, in either case to the effect that, among other
things, the Holders of the Debt Securities of such series will not recognize
income, gain or loss for federal income tax purposes as a result of such deposit
and defeasance of the Indenture and will be subject to federal income tax on the
same amount and in the same manner and at the same times, as would have been the
case if such deposit and defeasance had not occurred. Notwithstanding such
deposit, the obligations of SRAC under the Indenture to pay interest and
principal shall remain in full force and effect until the Debt Securities of
such series have been paid in full. (SECTION 13.4)
If and when a ruling from the Internal Revenue Service or an opinion of
recognized counsel can be provided without reliance upon the continuation of
SRAC's obligations regarding the payment of interest and principal, then such
obligations of SRAC shall cease upon delivery to the Trustee of such ruling or
opinion and compliance with the other conditions precedent provided for in the
Indenture. Under present ruling positions of the Internal Revenue Service, such
a ruling is not obtainable. (SECTION 13.4)
REGARDING THE TRUSTEE
The Chase Manhattan Bank, which is a Trustee under an Indenture, performs
other services for SRAC.
9
<PAGE>
PLAN OF DISTRIBUTION
GENERAL. SRAC may sell Debt Securities to or through underwriters, and also
may sell Debt Securities directly to other purchasers or through agents. It is
anticipated that SRAC will offer Debt Securities directly to brokers or dealers,
investment companies, insurance companies, banks, savings and loan associations,
trust companies or similar institutions, and trusts for which a bank, savings
and loan association, trust company or investment adviser is the trustee or
authorized to make investment decisions.
The distribution of the Debt Securities may be effected from time to time in
one or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Prospectus Supplement will
describe the method of distribution of the Offered Debt Securities.
In connection with the sale of Debt Securities, underwriters may receive
compensation from SRAC or from purchasers of Debt Securities for whom they may
act as agents in the form of discounts, concessions or commissions. Underwriters
may sell Debt Securities to or through dealers, and such dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions from the purchasers for whom they may act as
agent. Underwriters, dealers and agents that participate in the distribution of
Debt Securities may be deemed to be underwriters, and any discounts or
commissions received by them and any profit on the resale of Debt Securities by
them may be deemed to be underwriting discounts and commissions, under the Act.
Any such underwriter or agent will be identified, and any such compensation will
be described, in the Prospectus Supplement.
Under agreements which may be entered into by SRAC, underwriters, dealers
and agents who participate in the distribution of Debt Securities may be
entitled to indemnification by SRAC against certain liabilities, including
liabilities under the Act.
LEGAL OPINION
Unless otherwise specified in the accompanying Prospectus Supplement, the
legality of the Debt Securities is being passed upon for SRAC by Venrice R.
Palmer, Senior Counsel, Law Department, of Sears. At June 30, 1996, Mr. Palmer
owned 368 Sears common shares, including shares credited to his account in The
Savings and Profit Sharing Fund of Sears Employees, and had options granted
under the Sears employees stock plans relating to 3,545 shares.
EXPERTS
The financial statements and Summary Financial Information incorporated by
reference and included in this prospectus, respectively, and the financial
statements from which the Summary Financial Information included in this
Prospectus have been derived, have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their reports incorporated by reference
herein, and with respect to the Summary Financial Information has been included
as Exhibit 99 to the Registration Statement. Such financial statements and
Summary Financial Information have been incorporated by reference and included
herein, respectively, in reliance upon the reports of such firm and given upon
their authority as experts in accounting and auditing.
With respect to the unaudited interim financial information which is
incorporated herein by reference, Deloitte & Touche LLP have applied limited
procedures in accordance with professional standards for a review of such
information. However, as stated in their reports included in the Quarterly
Reports on
10
<PAGE>
Form 10-Q for Sears and SRAC and incorporated by reference herein, they did not
audit and they did not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their reports on such information should
be restricted in light of the limited nature of the review procedures applied.
Deloitte & Touche LLP are not subject to the liability provisions of Section 11
of the Securities Act of 1933 for their reports on the unaudited interim
financial information because those reports are not "reports" or a "part" of the
registration statement prepared or certified by an accountant within the meaning
of Sections 7 and 11 of the Act.
11
<PAGE>
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
S.E.C. Registration Fee...................................... $1,379,310.00
Rating Agency Fee............................................ *
State Qualification Expense (including legal fees)........... *
Trustee's Fees............................................... *
Printing and Engraving....................................... *
Legal Fees................................................... *
Auditors' Fees............................................... *
Miscellaneous................................................ *
-------------
Total...................................................... $ *
-------------
-------------
</TABLE>
- ------------------------
* To be filed by amendment
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Sears Roebuck Acceptance Corp. ("SRAC") is a Delaware corporation. Section
145 of the General Corporation Law of the State of Delaware ("GCL") provides
that a Delaware corporation has the power to indemnify its officers and
directors in certain circumstances.
Subsection (a) of Section 145 of the GCL empowers a corporation to indemnify
any director or officer, or former director or officer, who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation), against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred in connection with such action, suit or
proceeding provided that such director or officer acted in good faith in a
manner reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, provided
that such director or officer had no cause to believe his or her conduct was
unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
director or officer, or former director or officer, who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that such person acted in any capacities set forth above,
against expenses actually and reasonably incurred in connection with the defense
or settlement of such action or suit provided that such director or officer
acted in good faith and in a manner reasonably believed to be in or not opposed
to the best interests of the corporation, except that no indemnification may be
made in respect of any claim, issue or matter as to which such director or
officer shall have been adjudged to be liable for negligence or misconduct in
the performance of his or her duty to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action was brought
shall determine that despite the adjudication of liability such director or
officer is fairly and reasonably entitled to indemnity for such expenses which
the court shall deem proper.
Section 145 further provides that to the extent a director or officer of a
corporation has been successful in the defense of any action, suit or proceeding
referred to in subsections (a) and (b) or in the defense of any claim, issue or
matter therein, he or she shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in connection
therewith; that indemnification provided for by Section 145 shall not be deemed
exclusive of any other rights to which the indemnified party may be entitled;
and empowers the corporation to purchase and maintain insurance on behalf of a
director or officer of the corporation against any liability asserted against
him or her or incurred by him or her in any such capacity or arising out of his
or her status as such whether or not the corporation would have the power to
indemnify him or her against such liabilities under Section 145.
II-1
<PAGE>
Article 11 of SRAC's Certificate of Incorporation provides for
indemnification of SRAC's officers and directors to the fullest extent permitted
by applicable law.
Certain directors of SRAC are also officers of Sears, a New York
corporation. Sections 721 through 724 of the New York Business Corporation Law
("BCL") provide that in certain circumstances a corporation may indemnify
directors and officers against judgments, fines, amounts paid in settlement and
reasonable expenses, including attorneys' fees, actually and necessarily
incurred as a result of any action or proceeding by it or in the right of any
other corporation which such directors or officers served in any capacity at the
request of Sears, if such director or officer acted, in good faith, for a
purpose which he or she reasonably believed not to be opposed to, the best
interests of SRAC and, in criminal actions or proceedings, had no reasonable
cause to believe that his conduct was unlawful; provided, however, that no
indemnification may be provided where a person had been adjudged to have acted
in bad faith or to have engaged in active and deliberate dishonesty and were
material to the cause of action adjudicated, or to have gained a financial
profit or other advantage to which he or she was not legally entitled. A
corporation is required to indemnify against reasonable expenses (including
attorneys' fees) any director or officer who successfully defends any such
actions. The foregoing statements are subject to the detailed provisions of the
BCL.
Article V of the by-laws of Sears provides that Sears shall indemnify to the
full extent permitted by law, any person made, or threatened to be made, a party
to, or who is otherwise involved in, any action, suit or proceeding whether
civil, criminal, administrative or investigative, by reason of the fact that
such person or his testator or intestate, while a director or officer of Sears
and at the request of Sears, is or was serving another corporation in any
capacity, against judgments, fines, amounts paid in settlement and all expenses,
including attorneys' fees, actually incurred as a result of such action. Article
V states that the indemnification benefits provided thereby are contracts
rights, enforceable as if set forth in a written contract.
Sears has in effect insurance policies in the amount of $100 million
covering all of Sears and SRAC's directors and officers in certain instances
where by law they may not be indemnified by Sears or SRAC.
The form of Underwriting Agreement and the form of Distribution Agreement,
filed as Exhibits 1(a) and 1(b) hereto, respectively, and incorporated herein by
reference, contain certain provisions relating to indemnification.
ITEM 16. EXHIBITS.
<TABLE>
<C> <S>
1(a) Form of Underwriting Agreement.
1(b) Form of Distribution Agreement.
4(a) Indenture dated as of May 15, 1995 between registrant and The Chase Manhattan Bank,
N.A. (incorporated by reference to Exhibit 4(b) to Amendment No. 1 to Registration
Statement on Form S-3, Registration Statement No. 33-64215).
4(b) Fixed Charge Coverage and Ownership Agreement dated as of May 15, 1995 between SRAC
and Sears, Roebuck and Co. (incorporated by reference to Exhibit 4(e) to registrant's
Current Report on Form 8-K for June 8, 1995, File No. 1-4040).
4(c) Extension Agreement dated March 1, 1996 between Sears, Roebuck and Co. and the
registrant (incorporated by reference to Exhibit 4(k) to registrant's Annual Report
on Form 10-K for the fiscal year ended December 30, 1995, File No. 1-4040).
4(d) Form of Extension Agreement between SRAC and Sears, Roebuck and Co. relating to debt
Securities to be offered under this registration statement.
5 Opinion of Venrice R. Palmer.
12(a) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended
December 30, 1995 (incorporated by reference to Exhibit 12 to registrant's Annual
Report on Form 10-K for the fiscal year ended December 30, 1995, File No. 1-4040).
</TABLE>
II-2
<PAGE>
<TABLE>
<C> <S>
12(b) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended
December 31, 1994 (incorporated by reference to Exhibit 12 to registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1994, File No. 1-4040).
12(c) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended
December 31, 1993 (incorporated by reference to Exhibit 12 to registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1993, File No. 1-4040).
12(d) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended
December 31, 1992 (incorporated by reference to Exhibit 12 to registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 1-4040).
12(e) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended
December 31, 1991 (incorporated by reference to Exhibit 12 to registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 1-4040).
12(f) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the three-month period
ended March 30, 1996 (incorporated by reference to Exhibit 12 to registrant's
Quarterly Report on Form 10-Q for the quarterly period ended March 30, 1996, File No.
1-4040).
12(g) Calculation of Ratio of Income to Fixed Charges for Sears, Roebuck and Co. and
consolidated subsidiaries for each of the fiscal years ended December 30, 1995 and
December 31, 1994, 1993, 1992 and 1991 and for the twelve- and three-month periods
ended March 30, 1996 (incorporated by reference to Exhibit 12(a) to Sears Quarterly
Report on Form 10-Q for the quarterly period ended March 30, 1996, File No. 1-416).
15(a) Acknowledgement of awareness from Deloitte & Touche LLP concerning unaudited interim
financial information (SRAC).
15(b) Acknowledgement of awareness from Deloitte & Touche LLP concerning unaudited interim
financial information (Sears, Roebuck and Co.).
23(a) Consent of Deloitte & Touche LLP (SRAC).
23(b) Consent of Deloitte & Touche LLP (Sears, Roebuck and Co.).
23(c) Consent of Venrice R. Palmer (included in Exhibit 5).
24(a) Power of Attorney of certain officers and directors of the registrant.
24(b) Power of Attorney of certain officers and directors of the co-registrant.
25 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of
1939, as amended.
99 Independent Auditors' Report.
</TABLE>
II-3
<PAGE>
ITEM 17. UNDERTAKINGS
The undersigned registrant and co-registrant hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant or co-registrant pursuant to section 13 or 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant and co-registrant hereby undertake that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's or co-registrant's annual report pursuant to section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant or co-registrant pursuant to the provisions described in this
registration statement above, or otherwise, the registrant and the co-registrant
have been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant or
co-registrant in the successful defense of any action, suit or proceeding) is
asserted against the registrant or co-registrant by such director, officer or
controlling person in connection with the securities being registered, the
registrant or co-registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
and co-registrant certify that they have reasonable grounds to believe that they
meet all of the requirements for filing on Form S-3 and have duly caused this
registration statement to be signed on their behalf by the undersigned,
thereunto duly authorized, in Greenville, State of Delaware, and Hoffman
Estates, State of Illinois, respectively, on the day of , 1996.
SEARS ROEBUCK ACCEPTANCE CORP.
By KEITH E. TROST*
------------------------------------
Keith E. Trost
PRESIDENT
SEARS, ROEBUCK AND CO.
By ALICE M. PETERSON**
------------------------------------
Alice M. Peterson
VICE PRESIDENT AND TREASURER
II-5
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------- ----------------------------------------------------- -----------------------
<S> <C> <C> <C>
KEITH E. TROST* Director and President of Sears Roebuck Acceptance
Corp. (Principal Executive Officer)
STEPHEN D. CARP* Vice President, Finance and Assistant Secretary of
Sears Roebuck Acceptance Corp. (Principal Financial
and Accounting Officer)
JAMES A. BLANDA* Director of Sears Roebuck Acceptance Corp.
JAMES D. CONSTANTINE* Director of Sears Roebuck Acceptance Corp.
ALAN J. LACY* Director of Sears Roebuck Acceptance Corp.
ALICE M. PETERSON* Director of Sears Roebuck Acceptance Corp.
LARRY R. RAYMOND* Director of Sears Roebuck Acceptance Corp.
GEORGE F. SLOOK* Director of Sears Roebuck Acceptance Corp.
ARTHUR C. MARTINEZ** Director, Chairman of the Board of Directors,
President and Chief Executive Officer of Sears,
Roebuck and Co. (Principal Executive Officer)
ALAN J. LACY** Executive Vice President and Chief Financial Officer
of Sears, Roebuck and Co. (Principal Financial
Officer)
JAMES A. BLANDA** Vice President and Controller of Sears, Roebuck and
Co. (Principal Accounting Officer)
HALL ADAMS, JR.** Director of Sears, Roebuck and Co.
WARREN L. BATTS** Director of Sears, Roebuck and Co.
JAMES W. COZAD** Director of Sears, Roebuck and Co.
NANCY C. REYNOLDS** Director of Sears, Roebuck and Co.
CLARENCE B. ROGERS, JR.** Director of Sears, Roebuck and Co.
DONALD H. RUMSFELD** Director of Sears, Roebuck and Co.
DOROTHY A. TERRELL** Director of Sears, Roebuck and Co.
August 8, 1996
</TABLE>
<TABLE>
<S> <C> <C>
*By INDIVIDUALLY AND AS
---------------------------------------- ATTORNEY-IN-FACT
Keith E. Trost
**By ATTORNEY-IN-FACT
----------------------------------------
Larry R. Raymond
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------------- -------------------------------------------------------------------------------------------------
<C> <S> <C>
1(a) Form of Underwriting Agreement.
1(b) Form of Distribution Agreement.
4(a) Indenture dated as of May 15, 1995 between registrant and The Chase Manhattan Bank, N.A.
(incorporated by reference to Exhibit 4(b) to Amendment No. 1 to Registration Statement on Form
S-3, Registration Statement No. 33-64215).
4(b) Fixed Charge Coverage and Ownership Agreement dated as of May 15, 1995 between SRAC and Sears,
Roebuck and Co. (incorporated by reference to Exhibit 4(e) to registrant's Current Report on Form
8-K for June 8, 1995, File No. 1-4040).
4(c) Extension Agreement dated March 1, 1996 between Sears, Roebuck and Co. and the registrant
(incorporated by reference to Exhibit 4(k) to registrant's Annual Report on Form 10-K for the
fiscal year ended December 30, 1995, File No. 1-4040).
4(d) Form of Extension Agreement between SRAC and Sears, Roebuck and Co. relating to debt Securities
to be offered under this registration statement.
5 Opinion of Venrice R. Palmer.
12(a) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended December 30,
1995 (incorporated by reference to Exhibit 12 to registrant's Annual Report on Form 10-K for the
fiscal year ended December 30, 1995, File No. 1-4040).
12(b) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended December 31,
1994 (incorporated by reference to Exhibit 12 to registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994, File No. 1-4040).
12(c) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended December 31,
1993 (incorporated by reference to Exhibit 12 to registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993, File No. 1-4040).
12(d) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended December 31,
1992 (incorporated by reference to Exhibit 12 to registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1992, File No. 1-4040).
12(e) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the fiscal year ended December 31,
1991 (incorporated by reference to Exhibit 12 to registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1991, File No. 1-4040).
12(f) Calculation of Ratio of Earnings to Fixed Charges for SRAC for the three-month period ended March
30, 1996 (incorporated by reference to Exhibit 12 to registrant's Quarterly Report on Form 10-Q
for the quarterly period ended March 30, 1996, File No. 1-4040).
12(g) Calculation of Ratio of Income to Fixed Charges for Sears, Roebuck and Co. and consolidated
subsidiaries for each of the fiscal years ended December 30, 1995 and December 31, 1994, 1993,
1992 and 1991 and for the twelve- and three-month periods ended March 30, 1996 (incorporated by
reference to Exhibit 12(a) to Sears Quarterly Report on Form 10-Q for the quarterly period ended
March 30, 1996, File No. 1-416).
15(a) Acknowledgement of awareness from Deloitte & Touche LLP concerning unaudited interim financial
information (SRAC).
15(b) Acknowledgement of awareness from Deloitte & Touche LLP concerning unaudited interim financial
information (Sears, Roebuck and Co.).
23(a) Consent of Deloitte & Touche LLP (SRAC).
23(b) Consent of Deloitte & Touche LLP (Sears, Roebuck and Co.).
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------------- -------------------------------------------------------------------------------------------------
<C> <S> <C>
23(c) Consent of Venrice R. Palmer (included in Exhibit 5).
24(a) Power of Attorney of certain officers and directors of the registrant.
24(b) Power of Attorney of certain officers and directors of the co-registrant.
25 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939, as
amended.
99 Independent Auditors' Report.
</TABLE>
Exhibit 1(a)
UNDERWRITING AGREEMENT
, 199
Dear Sirs:
Sears Roebuck Acceptance Corp., a Delaware corporation (the
"Company") proposes to issue and sell from time to time certain of
its debt securities registered under the registration
statement referred to in Section 2(a) (the "Securities"). The
Company intends to enter into one or more Pricing Agreements (each
a "Pricing Agreement") in the form of Annex I hereto, with such
additions and deletions as the parties thereto may determine, and,
subject to the terms and conditions stated herein and therein, to
issue and sell to the firms named in Schedule I to the applicable
Pricing Agreement (such firms constituting the "Underwriters" with
respect to such Pricing Agreement and the securities specified
therein) certain of the Securities specified in Schedule II to such
Pricing Agreement (with respect to such Pricing Agreement, the
"Designated Securities"). The Designated Securities with respect
to each Pricing Agreement shall be issued under an indenture (the
"Indenture") identified in such Pricing Agreement.
1. Particular sales of Designated Securities may be made
from time to time to the Underwriters of such Securities, for whom
you will act as representatives. This Underwriting Agreement shall
not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to
purchase the Securities. The obligation of the Company to issue
and sell any of the Securities and the obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced
by the Pricing Agreement with respect to the Designated Securities
specified therein. Each Pricing Agreement shall specify the
aggregate principal amount of such Designated Securities, the
public offering price of such Designated Securities, the purchase
price to the Underwriters of such Designated Securities, the names
of the Underwriters of such Designated Securities, the principal
amount of such Designated Securities to be purchased by each
Underwriter and the commission payable to the Underwriters with
respect thereto and shall set forth the date, time and manner of
delivery of such Designated Securities and payment therefor. The
Pricing Agreement shall also describe, in a manner consistent with
the Indenture and the registration statement and prospectus with
respect thereto, the principal terms of such Designated Securities.
A Pricing Agreement shall be in the form of an executed writing
(which may be in counterparts), and may be evidenced by an exchange
of telegraphic communications or any other rapid transmission
device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this
Agreement and each Pricing Agreement shall be several and not
joint.
2. Each of the Company and Sears, Roebuck and Co.
("Sears") represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement in respect of the
Securities has been filed with the Securities and Exchange
Commission (the "Commission"); such registration statement and any
post-effective amendment thereto, each in the form heretofore
delivered or to be delivered to you and, excluding exhibits to such
registration statement, but including all documents incorporated by
reference in the prospectus included therein, to you for each of
the other Underwriters have been declared effective by the
Commission in such form (any preliminary prospectus included in
such registration statement being hereinafter called a "Preliminary
Prospectus;" the various parts of such registration statement,
including all exhibits thereto except Form T-1, each as amended at
the time such part became effective, being hereinafter collectively
called the "Registration Statement;" the prospectus relating to the
Securities, in the form in which it has most recently been filed
with the Commission on or prior to the date of this Agreement,
being hereinafter called the "Prospectus;" any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to
include the documents, if any, incorporated by reference therein
pursuant to the applicable form under the Securities Act of 1933,
as amended (the "Act"), as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to include any documents filed after the
date of such Preliminary Prospectus or Prospectus, as the case may
be, under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") and so incorporated by reference; and any reference
to the Prospectus as amended or supplemented shall be deemed to
refer to the Prospectus as amended or supplemented in relation to
the applicable Designated Securities in the form in which it is
first filed with the Commission pursuant to Rule 424(b) of
Regulation C under the Act, including any documents incorporated by
reference therein as of the date of such filing);
(b) Except for statements in such documents which do
not constitute part of the Registration Statement or the Prospectus
pursuant to Rule 412 of Regulation C under the Act and after
substituting therefor any statements modifying or superseding such
excluded statements (i) the documents incorporated by reference in
the Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material respects
to the requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder, and
none of such documents, when they became effective or were so
filed, as the case may be, contained, in the case of documents
which became effective under the Act, an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and, in the case of documents which were filed under
the Exchange Act with the Commission, an untrue statement of a
material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and (ii)
any further documents so filed and incorporated by reference when
they become effective or are filed with the Commission, as the case
may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain, in
the case of documents which become effective under the Act, an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and, in the case of documents
which are filed under the Exchange Act with the Commission, 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 are made, not
misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter of Designated Securities
through you expressly for use therein; at the Time of Delivery (as
defined in Section 4 hereof), the Indenture will be duly qualified
under, and will conform in all material respects to the
requirements of, the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"); and
(c) Except for statements in documents incorporated
therein by reference which do not constitute part of the
Registration Statement or the Prospectus pursuant to Rule 412 of
Regulation C under the Act and after substituting therefor any
statements modifying or superseding such excluded statements, the
Registration Statement and the Prospectus conformed, and any
amendments or supplements thereto will, when they become effective
or are filed with the Commission, as the case may be, conform, in
all material respects to the requirements of the Act and the Trust
Indenture Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective
date as to the Registration Statement and as of the applicable
filing date as to the Prospectus, contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter of Designated Securities
through you expressly for use in the Prospectus as amended or
supplemented relating to such Securities.
3. The Company represents and warrants to, and agrees with
each of the Underwriters that:
(a) Upon payment therefor as provided herein, the
Securities will have been duly and validly authorized and (assuming
their due authentication by the Trustee) will have been duly and
validly issued and will be valid outstanding obligations of the
Company in accordance with their terms, except as the same may be
limited by insolvency, bankruptcy, reorganization, or other laws
relating to or affecting the enforcement of creditors' rights or by
general equity principles, and will be entitled to the benefits of
the Indenture; and
(b) The issue and sale of the Securities pursuant to
any Pricing Agreement and the compliance by the Company with all of
the provisions of the Securities, the Indenture, this Agreement
will not conflict with or result in any breach which would
constitute a material default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any of the
property or assets of the Company material to the Company pursuant
to the terms of, any indenture, loan agreement or other agreement
or instrument for borrowed money to which the Company is a party or
by which the Company may be bound or to which any of the property
or assets of the Company, material to the Company, is subject, nor
will such action result in any material violation of the provisions
of the Certificate of Incorporation, as amended or the By-Laws of
the Company or, to the best of its knowledge, any statute or any
order, rule or regulation applicable to the Company of any court or
any Federal, State or other regulatory authority or other
governmental body having jurisdiction over the Company, and no
consent, approval, authorization or other order of, or filing with,
any court or any such regulatory authority or other governmental
body is required for the issue and sale of the Designated
Securities except as may be required under the Act, the Exchange
Act, the Trust Indenture Act and securities laws of the various
states and other jurisdictions in which the Underwriters will offer
and sell the Designated Securities.
4. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by you of the release of
the Underwriters' Securities, the several Underwriters propose to
offer the Underwriters' Securities for sale upon the terms and
conditions set forth in the Prospectus as amended or supplemented.
The principal amount of Contract Securities to be deducted
from the principal amount of Designated Securities to be purchased
by each Underwriter as set forth in Schedule I to the Pricing
Agreement applicable to such Designated Securities shall be, in
each case, the principal amount of Contract Securities which the
Company has been advised by you have been attributed to such
Underwriter, provided that, if the Company has not been so advised,
the amount of Contract Securities to be so deducted shall be, in
each case, that proportion of Contract Securities which the
principal amount of Designated Securities to be purchased by such
Underwriter under such Pricing Agreement bears to the total
principal amount of the Designated Securities (rounded as you may
determine to the nearest $1,000 principal amount). The total
principal amount of Underwriters' Securities to be purchased by all
the Underwriters pursuant to such Pricing Agreement shall be the
total principal amount of Designated Securities set forth in
Schedule I to such Pricing Agreement less the principal amount of
the Contract Securities. The Company will deliver to you not later
than 3:30 p.m., New York time, on the third business day preceding
the Time of Delivery specified in the applicable Pricing Agreement
(or such other time and date as you and the Company may agree upon
in writing) a written notice setting forth the principal amount of
Contract Securities.
The Pricing Agreement applicable to any Designated Securities
may provide that the Company and any entity acting as an
underwriter with respect to such Designated Securities may enter
into a deferred pricing agreement in the form set forth in a
schedule attached to such Pricing Agreement.
5. Underwriters' Securities to be purchased by each
Underwriter pursuant to the Pricing Agreement relating thereto, in
definitive form to the extent practicable, and in such authorized
denominations and registered in such names as you may request upon
at least two business days prior notice to the Company, shall be
delivered by or on behalf of the Company to you for the account of
such Underwriter, against payment by such Underwriter or on its
behalf of the purchase price therefor, by certified or official
bank check or checks or wire transfer, as specified in such Pricing
Agreement, payable to the order of the Company in the funds
specified in such Pricing Agreement, all at the place and time and
date specified in such Pricing Agreement or at such other place and
time and date as you and the Company may agree upon in writing,
such time and date being herein called the "Time of Delivery" for
such Securities.
6. Each of the Company and Sears agrees with each of the
Underwriters of Designated Securities:
(a) To make no further amendment or any supplement to
the Registration Statement or the Prospectus as amended or
supplemented after the date of the Pricing Agreement relating to
such Securities and prior to the Time of Delivery for such
Securities without first having furnished you with a copy of the
proposed form thereof and given you a reasonable opportunity to
review the same; to advise you promptly of any such amendment or
supplement after such Time of Delivery and furnish you with copies
thereof and to file promptly all reports and any definitive proxy
or information statements required to be filed by the Company or
Sears, respectively, with the Commission pursuant to Section 13 or
14 of the Exchange Act for so long as the delivery of a prospectus
is required in connection with the offering or sale of such
Securities, and during such same period to advise you, promptly
after the Company or Sears receives notice thereof, of the time
when the Registration Statement, or any amendment thereto, or any
amended Registration Statement has become effective or any
supplement to the Prospectus or any amended Prospectus has been
filed, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any Prospectus, or
the suspension of the qualification of such Securities for offering
or sale in any jurisdiction, or the initiation or threatening of
any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and in the
event of the issuance of any such stop order or of any such order
preventing or suspending the use of any such Prospectus or
suspending any such qualification, to use promptly its best efforts
to obtain its withdrawal;
(b) Promptly from time to time to take such action as
you may reasonably request to qualify such Securities for offering
and sale under the securities laws of such jurisdictions as you may
request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of such
Securities, provided that in connection therewith neither the
Company nor Sears shall be required to qualify as a foreign
corporation or to file a general consent to service of process in
any jurisdiction;
(c) To furnish the Underwriters with copies of the
Prospectus as amended or supplemented in such quantities as you may
from time to time reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering
or sale of such Securities and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary during such same
period to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Act, the Exchange Act or the
Trust Indenture Act, to notify you and to prepare and furnish
without charge to each Underwriter and to any dealer in securities
as many copies as you may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus which will
correct such statement or omission or effect such compliance; and
(d) To make generally available to its security
holders, in accordance with the provisions of Rule 158 under the
Act or otherwise, as soon as practicable, but in any event not
later than forty-five days after the end of the fourth full fiscal
quarter (ninety days in the case of the last fiscal quarter in any
fiscal year) following the fiscal quarter ending after the latest
of (x) the effective date of the Registration Statement, (y) the
effective date of the post-effective amendment thereto hereinafter
referred to, and (z) the date of the filing of the report
hereinafter referred to, earnings statements of the Company and
Sears and its consolidated subsidiaries (which need not be audited)
complying with Section 11(a) of the Act and covering a period of at
least twelve consecutive months beginning after the latest of (i)
the effective date of such Registration Statement, (ii) the
effective date of the post-effective amendment, if any, to such
Registration Statement (within the meaning of Rule 158) next
preceding the date of the Pricing Agreement relating to the
Designated Securities and (iii) the date of filing of the last
report of the Company or Sears incorporated by reference into the
Prospectus (within the meaning of Rule 158) next preceding the date
of the Pricing Agreement relating to the Designated Securities.
7. The Company agrees with each of the Underwriters of
Designated Securities:
(a) During the period beginning from the date of the
Pricing Agreement for such Designated Securities and continuing to
and including the earlier of (i) the termination of trading
restrictions for such Designated Securities, of which termination
you agree to give the Company prompt notice confirmed in writing,
and (ii) the Time of Delivery for such Designated Securities, not
to offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company which mature more than one year after
such Time of Delivery and which are substantially similar to such
Designated Securities, without your prior written consent, which
consent shall not be unreasonably withheld, except pursuant to
arrangements of which you have been advised by the Company prior to
the time of execution of such Pricing Agreement, which advice is
confirmed in writing to you by the end of the business day
following the date of such Pricing Agreement; and
(b) To pay or cause to be paid all expenses,
preapproved by the Company, incident to the performance of its
obligations hereunder and under any Pricing Agreement, including
the cost of all qualifications of the Securities under state
securities laws (including reasonable fees of counsel to the
Underwriters in connection with such qualifications and in
connection with legal investment surveys) and the cost of printing
this Agreement, any Pricing Agreement, and any blue sky and legal
investment memoranda.
8. The obligations of the Underwriters of any Designated
Securities under the Pricing Agreement relating to such Designated
Securities shall be subject, in their discretion, to the condition
that all representations and warranties and other statements of the
Company or Sears herein are, at and as of the Time of Delivery for
such Designated Securities, true and correct, the condition that
each of the Company and Sears shall have performed all of its
obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part
of the Commission shall have been complied with to your reasonable
satisfaction.
(b) All corporate proceedings and related matters in
connection with the organization of the Company, the validity of
the Indenture and the registration, authorization, issue, sale and
delivery of the Designated Securities shall have been satisfactory
to counsel to the Underwriters, and such counsel shall have been
furnished with such papers and information as they may reasonably
have requested to enable them to pass upon the matters referred to
in this subdivision (b).
(c) Counsel to the Company and Sears shall have
0furnished to you such counsel's written opinion, dated the Time of
Delivery for such Designated Securities, in form and substance
satisfactory to you in your reasonable judgment, to the effect
that:
(i) Each of the Company and Sears has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its respective state of incorporation;
(ii) The authorized capital stock of the Company
consists of 500,000 shares of common stock, par value $100.00 per
share, all of the issued and outstanding shares of which are owned
by Sears, Roebuck and Co., and the authorized capital stock of
Sears is as set forth or incorporated by reference in the
Registration Statement;
(iii) SRAC is not an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended;
(iv) This Agreement and the Pricing Agreement
with respect to the Designated Securities have been duly
authorized, executed and delivered on the part of the Company and
Sears;
(v) The issue and sale of the Designated
Securities and the compliance by the Company with all of the
provisions of the Designated Securities, the Indenture, this
Agreement and the Pricing Agreement with respect to the Designated
Securities will not (a) conflict with or result in any breach which
would constitute a material default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
of the property or assets of the Company material to the Company,
pursuant to the terms of, any indenture, loan agreement or other
agreement or instrument for borrowed money known to such counsel to
which the Company is a party or by which the Company may be bound
or to which any of the property or assets of the Company material
to the Company is subject, (b) result in any material violation of
the provisions of the Certificate of Incorporation, as amended or
the By-Laws of the Company or (c) to the best of the knowledge of
such counsel, result in any material violation of any statute or
any order, rule or regulation applicable to the Company of any
court or any Federal, State or other regulatory authority or other
governmental body having jurisdiction over the Company, other than
the Act, the Exchange Act, the Trust Indenture Act and the rules
and regulations pursuant to each such act, and other than the
securities laws of the various states or other jurisdictions which
are applicable to the issue and sale of the Designated Securities;
and, to the best knowledge of such counsel, no consent, approval,
authorization or other order of, or filing with, any court or any
such regulatory authority or other governmental body is required
for the issue and sale of the Designated Securities except as may
be required under the Act, the Exchange Act, the Trust Indenture
Act and securities laws of the various states or other
jurisdictions which are applicable to the issue and sale of the
Designated Securities;
(vi) The Fixed Charge Coverage and Ownership
Agreement has been duly authorized, executed and delivered by the
parties thereto and is a valid and binding instrument in accordance
with its terms except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting
the enforcement of creditors' rights or by general equity
principles;
(vii) The Indenture has been duly
authorized, executed and delivered on the part of the Company and,
as to the Company, is a valid and binding instrument in accordance
with its terms except as the foregoing may be limited by
insolvency, bankruptcy, reorganization or other laws relating to or
affecting the enforcement of creditors' rights or by general equity
principles, and has been qualified under the Trust Indenture Act;
the Underwriters' Securities have been duly authorized and
(assuming their due authentication by the Trustee) have been duly
executed, issued and delivered on the part of the Company and
constitute valid and binding obligations of the Company in
accordance with their terms, entitled to the benefits of the
Indenture, except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting
the enforcement of creditors' rights or by general equity
principles; the Contract Securities, if any, when executed,
authenticated, issued and delivered pursuant to the Indenture, will
constitute valid and binding obligations of the Company in
accordance with their terms, entitled to the benefits of the
Indenture, except as the foregoing may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting
the enforcement of creditors' rights or by general equity
principles;
(viii) Such counsel does not know of any
pending legal or governmental proceedings required to be described
in the Prospectus as amended or supplemented which are not
described as required;
(ix) Except for statements in such documents
which do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or superseding
such excluded statements, the documents incorporated by reference
in the Prospectus as amended or supplemented (other than the
financial statements and related schedules, the analyses of
operations and financial condition and other financial, statistical
and accounting data therein, as to which such counsel need express
no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder;
(x) Except for statements in such documents
which do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or superseding
such excluded statements, the Registration Statement and the
Prospectus as amended or supplemented (excluding the documents
incorporated by reference therein) (other than the financial
statements and related schedules, the analyses of operations and
financial condition and other financial, statistical and accounting
data therein as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of
the Act and the rules and regulations thereunder; the answers in
the Registration Statement to Items 9 and 10 (insofar as it relates
to such counsel) of Form S-3 are to the best of such counsel's
knowledge accurate statements or summaries of the matters therein
set forth and fairly present the information called for with
respect to those matters by the Act and the rules and regulations
thereunder; and
(xi) Such counsel does not know of any contract
or other document to which the Company or Sears or any subsidiary
thereof is a party required to be filed as an exhibit to the
Registration Statement or required to be incorporated by reference
into the Prospectus as amended or supplemented or required to be
described in the Prospectus as amended or supplemented which has
not been so filed, incorporated by reference or described.
In rendering such opinion, such counsel may rely to the
extent such counsel deems appropriate upon certificates of officers
or other executives of the Company, Sears and its business groups
and subsidiaries and of public officials as to factual matters and
upon opinions of other counsel. Such counsel shall also state
that: (a) nothing has come to such counsel's attention which has
caused such counsel to believe that any of the documents referred
to in subdivision (viii) above (other than the financial
statements, the analyses of operations and financial condition and
other financial, statistical and accounting data therein, as to
which such counsel need express no belief), in each case after
excluding any statement in any such document which does not
constitute part of the Registration Statement or the Prospectus as
amended or supplemented pursuant to Rule 412 of Regulation C under
the Act and after substituting therefor any statement modifying or
superseding such excluded statement, when they became effective or
were filed, as the case may be, contained, in the case of documents
which became
effective under the Act, an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and, in
the case of documents which were filed under the Exchange Act with
the Commission, an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading, and (b) nothing has come to such counsel's
attention which has caused such counsel to believe that the
Registration Statement or the Prospectus as amended or supplemented
(other than the financial statements, the analyses of operations
and financial condition and other financial, statistical and
accounting data therein, as to which such counsel need express no
belief) contains an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading.
(d) At the Time of Delivery for such Designated
Securities, Deloitte & Touche shall have furnished you a letter or
letters, dated the date of delivery thereof in form and substance
satisfactory to you as to such matters as you may reasonably
request.
(e) (i) The Company shall not have sustained, since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus as amended or
supplemented any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree and (ii) since the respective
dates as of which information is given in the Prospectus as amended
or supplemented there shall not have been any material change in
the capital stock accounts or long-term debt of the Company or any
material adverse change in the general affairs, financial position,
stockholders' equity or results of operations of the Company,
otherwise than as set forth or contemplated in the Prospectus as
amended or supplemented, the effect of which in any such case
described in clause (i) or (ii), in your judgment makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Designated Securities on the terms and in the
manner contemplated in the Prospectus as amended or supplemented.
(f) Subsequent to the date of the Pricing Agreement
relating to the Designated Securities, no downgrading shall have
occurred in the rating accorded to the Company's or Sears senior
debt securities by Moody's Investors Service, Inc. or Standard &
Poor's Corporation; provided, however, that this subdivision (f)
shall not apply to any such rating agency which shall have notified
you of the rating of the Designated Securities prior to the
execution of the Pricing Agreement.
(g) Subsequent to the date of the Pricing Agreement
relating to the Designated Securities neither (i) the United States
shall have become engaged in the outbreak or escalation of
hostilities involving the United States or there has been a
declaration by the United States of a national emergency or a
declaration of war, (ii) a banking moratorium shall have been
declared by either Federal or New York State authorities, nor (iii)
trading in securities generally on the New York Stock Exchange
shall have been suspended nor limited or minimum prices shall have
been established by such Exchange, any of which events, in your
judgment, renders it inadvisable to proceed with the public
offering or the delivery of the Designated Securities.
(h) Each of the Company and Sears shall have
furnished or caused to be furnished to you at the Time of Delivery
for the Designated Securities certificates satisfactory to you as
to the accuracy at and as of such Time of Delivery of the
representations, warranties and agreements of the Company and
Sears, respectively, herein and as to the performance by each of
the Company and Sears of all its obligations hereunder to be
performed at or prior to such Time of Delivery and the Company
shall have also furnished you similar certificates satisfactory to
you as to the matters set forth in subdivision (a) of this Section
8.
9. (a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the
Registration Statement, any prospectus relating to the Securities
or the Prospectus as amended or supplemented, or any amendment or
supplement thereto furnished by the Company or Sears, or arise out
of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or (in the
case of the Registration Statement or the Prospectus as amended or
supplemented, or any amendment or supplement thereto) necessary to
make the statements therein not misleading or (in the case of any
Preliminary Prospectus) necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement, the
Prospectus or the Prospectus as amended or supplemented or any such
amendment or supplement in reliance upon and in conformity with
written information furnished to the Company by any Underwriter of
Designated Securities through you expressly for use in the
Prospectus as amended or supplemented relating to such Securities;
and provided, further, that the Company shall not be liable to any
Underwriter or any person controlling such Underwriter under the
indemnity agreement in this subdivision (a) with respect to the
Preliminary Prospectus or the Prospectus or the Prospectus as
amended or supplemented, as the case may be, to the extent that any
such loss, claim, damage or liability of such Underwriter or
controlling person results solely from the fact that such
Underwriter sold Designated Securities to a person to whom there
was not sent or given, at or prior to the written confirmation of
such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or of the Prospectus as then amended or
supplemented (excluding documents incorporated by reference) if the
Company has previously furnished copies thereof to such
Underwriter.
(b) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement, the Prospectus
or the Prospectus as amended or supplemented, or any amendment or
supplement thereto, or arise out of or are based upon the omission
or alleged
omission to state therein a material fact required to be stated
therein or (in the case of the Registration Statement or the
Prospectus or the Prospectus as amended or supplemented, or any
amendment or supplement thereto) necessary to make the statements
therein not misleading or (in the case of any Preliminary
Prospectus) necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading in
each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, the Registration
Statement, the Prospectus or the Prospectus as amended or
supplemented, or any such amendment or supplement in reliance upon
and in conformity with written
information furnished to the Company by such Underwriter through
you expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such action or
claim.
(c) Within a reasonable period after receipt by an
indemnified party under subdivision (a) or (b) above of notice of
the commencement of any action with respect to which
indemnification is sought under such subdivision or contribution
may be sought under subdivision (d) below, such indemnified party
shall notify the indemnifying party in writing of the commencement
thereof. In case any such action shall be brought against any
indemnified party, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified
party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof,
the indemnifying party shall not be liable to such indemnified
party for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
(d) If the indemnification provided for in this Section 9
is unavailable to an indemnified party under subdivision (a) or (b)
above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters of the
Designated Securities on the other from the offering of the
Designated Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates and also the
relative fault of the Company and Sears on the one hand and the
Underwriters of the Designated Securities on the other in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and
such Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from such offering (before
deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by such
Underwriters, in each case as set forth on the cover page of the
Prospectus as amended or supplemented. The relative fault shall be
determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information
supplied by the Company or Sears on the one hand or the
Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission of the Company or Sears on the
one hand and the Underwriters, directly or through you, on the
other hand. With respect to any Underwriter, such relative fault
shall also be determined by reference to the extent (if any) to
which such losses, claims, damages or liabilities (or actions in
respect thereof) with respect to any Preliminary Prospectus result
from the fact that such Underwriter sold Designated Securities to
a person to whom there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the Prospectus
(excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding documents
incorporated by reference) if the Company has previously furnished
copies thereof to such Underwriter. The Company and the
Underwriters agree that it would not be just and equitable if
contribution pursuant to this subdivision (d) were determined by
per capita allocation among the indemnifying parties (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 subdivision (d).
The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subdivision (d) shall be deemed
to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this
subdivision (d), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which
the applicable Designated Securities underwritten by it and
distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The
obligations of the Underwriters of Designated Securities in this
subdivision (d) to contribute are several in proportion to their
respective underwriting obligations with respect to such securities
and not joint.
(e) The obligations of the Company under this Section 9
shall be in addition to any liability which the Company may
otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the
Underwriters under this Section 9 shall be in addition to any
liability which the respective Underwriters may otherwise have and
shall extend, upon the same terms and conditions, to each officer
and director of the Company or Sears and to each person, if any,
who controls the Company within the meaning of the Act.
10. (a) If any Underwriter shall default in its
obligation to purchase the Underwriters' Securities which it has
agreed to purchase under the Pricing Agreement relating to such
Securities, you may in your discretion arrange for yourselves or
another party or other parties to purchase such Designated
Securities on the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for
the purchase of such Designated Securities, then the Company shall
be entitled to a further period of thirty-six hours within which to
procure another party or other parties to purchase such Designated
Securities on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so
arranged for the purchase of such Designated Securities, or the
Company notifies you that it has so arranged for the purchase of
such Designated Securities, you or the Company shall have the right
to postpone the Time of Delivery for such Designated Securities for
a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement
or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly
any amendments or supplements to the Registration Statement or the
Prospectus which may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person
had originally been a party to the Pricing Agreement with respect
to such Designated Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Underwriters' Securities of a defaulting
Underwriter or Underwriters by you and the Company as provided in
subdivision (a) above, the aggregate principal amount of such
Underwriters' Securities which remains unpurchased does not exceed
one-eleventh of the aggregate principal amount of the Designated
Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of
Underwriters' Securities which such Underwriter agreed to purchase
under the Pricing Agreement relating to such Designated Securities
and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the principal amount of
Designated Securities which such Underwriter agreed to purchase
under such Pricing Agreement) of the Underwriters' Securities of
such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Underwriters' Securities of a defaulting
Underwriter or Underwriters by you and the Company as provided in
subdivision (a) above, the aggregate principal amount of
Underwriters' Securities which remains unpurchased exceeds one-
eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subdivision (b) above, or if the
Company shall not exercise the right described in subdivision (b)
above to require non-defaulting Underwriters to purchase
Underwriters' Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such
Designated Securities shall thereupon terminate, without liability
on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the
Underwriters as provided in Section 7(b) hereof and the indemnity
and contribution agreements in Section 9 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its
default.
11. The respective indemnities, agreements,
representations, warranties and other statements of the Company,
Sears and the several Underwriters, as set forth in this Agreement
or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by
or on behalf of any Underwriter or any controlling person of any
Underwriter, the Company, Sears or any officer or director or
controlling person of the Company or Sears, and shall survive
delivery of and payment for the Securities.
Anything herein to the contrary notwithstanding, the
indemnity agreement of the Company in subdivisions (a) and (e) of
Section 9 hereof, the representations and warranties in
subdivisions (b) and (c) of Section 2 hereof and any representation
or warranty as to the accuracy of the Registration Statement or the
Prospectus as amended or supplemented contained in any certificate
furnished by the Company or Sears pursuant to subdivision (h) of
Section 8 hereof, insofar as they may constitute a basis for
indemnification for liabilities (other than payment by the Company
of expenses incurred or paid in the successful defense of any
action, suit or proceeding) arising under the Act, shall not extend
to the extent of any interest therein of an Underwriter or a
controlling person of an Underwriter if a director, officer or
controlling person of the Company or Sears when the Registration
Statement becomes effective or a person who, with his consent, is
named in the Registration Statement as being about to become a
director of the Company or Sears, is a controlling person of such
Underwriter, except in each case to the extent that an interest of
such character shall have been determined by a court of appropriate
jurisdiction as not against public policy as expressed in the Act.
Unless in the opinion of counsel for the Company or Sears the
matter has been settled by controlling precedent, the Company or
Sears will, if a claim for such indemnification is asserted, submit
to a court of appropriate jurisdiction the question whether such
interest is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
12. If any Pricing Agreement shall be terminated pursuant
to Section 10 hereof, the Company shall not then be under any
liability to any Underwriter with respect to the Designated
Securities covered by such Pricing Agreement except as provided in
Section 7(b) and Section 9 hereof; but, if for any other reason
Underwriters' Securities are not delivered by or on behalf of the
Company as provided herein, the Company will reimburse the
Underwriters through you for all out-of-pocket expenses approved in
writing by you, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for
the purchase, sale and delivery of such Designated Securities, but
the Company shall then be under no further liability to any
Underwriter with respect to such Designated Securities except as
provided in Section 7(b) and Section 9 hereof.
13. In all dealings hereunder, you shall act on behalf of
each of the Underwriters of Designated Securities, and the parties
hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or
given by you or by , representing
you.
All statements, requests, notices and agreements hereunder
shall be in writing or by telegram if promptly confirmed in writing
and if to the Underwriters shall be sufficient in all respects, if
delivered or sent by registered mail to you as the Representatives
at
; and if to the Company shall be sufficient in all
respects if delivered or sent by registered mail to the Company at
3711 Kennett Pike, Greenville, Delaware 19807, Attention: Richard
F. Kotz, Secretary; and if to Sears shall be sufficient in all
respects if delivered or sent by registered mail to Sears at 3333
Beverly Road, Hoffman Estates, Illinois, Attention: Michael D.
Levin, Senior Vice President and General Counsel.
14. This Agreement and each Pricing Agreement shall be
binding upon, and inure solely to the benefit of, the Underwriters,
the Company, Sears and, to the extent provided in Section 9 and
Section 11 hereof, the officers and directors of the Company and
Sears and each person who controls the Company or any Underwriter,
and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement or any such Pricing Agreement.
No purchaser of any of the Securities from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
15. Time shall be of the essence of each Pricing Agreement.
16. This Agreement and each Pricing Agreement shall be
governed by, and construed in accordance with, the internal laws of
the State of New York.
17. This Agreement and each Pricing Agreement may be
executed by any one or more of the parties hereto and thereto in
any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together
constitute one and the same instrument.
<PAGE>
If the foregoing is in accordance with your understanding,
please sign and return two counterparts hereof.
Very truly yours,
Sears Roebuck Acceptance Corp.
By:
Sears, Roebuck and Co.
By:
Accepted as of the date hereof:
On behalf of each of the Underwritiers<PAGE>
1ANNEX I
PRICING AGREEMENT
As Representatives of the several
Underwriters named in Schedule I hereto
,199
Dear Sirs:
Sears Roebuck Acceptance Corp., a Delaware corporation (the
"Company"), proposes subject to the terms and conditions stated
herein and in the Underwriting Agreement, dated ,
199 (the "Underwriting Agreement"), executed between the Company
and Sears, Roebuck and Co. ("Sears"), on the one hand, and
on the other hand, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters")
the Securities specified in Schedule II hereto (the "Designated
Securities"). Each of the provisions of the Underwriting Agreement
is incorporated herein by reference in its entirety, and shall be
deemed to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to
have been made at and, except where otherwise specified, as of the
date of this Pricing Agreement, except that each representation and
warranty with respect to the Prospectus in Sections 2 and 3 of the
Underwriting Agreement shall be deemed to be a representation and
warranty as of the date of the Underwriting Agreement in relation
to the Prospectus (as therein defined) and also a representation
and warranty as of the date of this Pricing Agreement in relation
to the Prospectus as amended or supplemented. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are
used herein as therein defined.
An amendment to the Registration Statement, or a supplement
to the Prospectus, as the case may be, relating to the Designated
Securities, in the form heretofore delivered to you is now proposed
to be filed with the Commission.
Subject to the terms and conditions set forth herein and in
the Underwriting Agreement incorporated herein by reference, the
Company agrees to issue and sell to each of the Underwriters, and
each of the Underwriters agrees, severally and not jointly, to
purchase from the Company, at the time and place and at a purchase
price to the Underwriters set forth in Schedule II hereto, the
principal amount of Designated Securities set forth opposite the
name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding,
please sign and return to us two counterparts hereof, and upon
acceptance hereof by you on behalf of each of the Underwriters,
this letter and such acceptance hereof, including the provisions of
the Underwriting Agreement incorporated herein by reference, shall
constitute a binding agreement between the Company, Sears and each
of the Underwriters. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the
authority set forth in a form of Agreement among Underwriters, the
form of which shall be supplied to the Company upon request. You
represent that you are authorized on behalf of yourselves and on
behalf of each of the other Underwriters named in Schedule I hereto
to enter into this
Agreement.
<PAGE>
Very truly yours,
SEARS ROEBUCK ACCEPTANCE CORP.
By:
SEARS, ROEBUCK AND CO.
By:
Accepted as of the date hereof:
On behalf of each of the Underwriters<PAGE>
SCHEDULE I
Principal
Amount
of Designated
Securities to
be
Underwriter Purchased
___________________
$
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE>
SCHEDULE II
Title of Designated Securities:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due
Aggregate principal amount:
$
Price to Public:
% of the principal amount of
the Designated Securities, plus accrued
interest from to the Time of
Delivery [and accrued amortization,
if any, from to the Time
of Delivery]
Purchase Price by Underwriters:
% of the principal amount of the
Designated Securities, plus accrued
interest from to the Time of
Delivery [and accrued amortization,
if any, from to the Time
of Delivery]
Indenture:
Indenture, dated , between
the Company and , as Trustee
Form of Designated Securities:
[Certificated form only][Global form only]
Maturity:1
Interest Rate:*
[ %] [Zero Coupon]
Interest Payment dates:*
[months and dates]
Redemption Provisions:*
[No provision for redemption]
[The Designated Securities may be redeemed,
otherwise than through the sinking fund,
in whole or in part at the option of the
Company, in the amount of $ or an
integral multiple thereof,
[on or after , at the following redemption
prices (expressed in percentages of
principal amount). If [redeemed on or before ,
%, and if] redeemed during the
12-month period beginning ,
Year Redemption Price
- ----------------------
1 The terms of an attached form of security may be incorporated
by reference.<PAGE>
and thereafter at 100% of their principal amount, together in
each case with accrued interest to the redemption date.]
[on any interest payment date falling on or after ,
, at the election of the Company, at a redemption price equal to
the principal amount thereof, plus accrued interest to the date of
redemption.]
[Other possible redemption provisions, such as mandatory
redemption upon occurrence of certain events or redemption for
changes in tax law]
[Restriction of refunding]
Sinking Fund Provisions:1
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a
sinking fund to retire $ principal amount of Designated
Securities on in each of the years through
at 100% of their principal amount plus accrued interest] [,
together with (cumulative) (non-cumulative) redemptions at the
option of the Company to retire an additional $ principal
amount of Designated Securities in the years through
at 100% of their principal amount plus accrued interest].
Time of Delivery:
[ ] A.M., New York time, [ ] ,19
Funds in which payment by Underwriters to Company to be made:
[ ] Clearing House Funds
[ ] Same day funds
Method of Payment:
[Certified or official bank check or checks]
[Wire transfer to ]
Closing Location:
Counsel:
To the Company, [ ]
To Sears, [ ]
To the Underwriters, [ ]
[Other Terms]:2
1 The terms of an attached form of security may be incorporated by
reference.
2 The terms of an attached form of security may be incorporated by
reference.
Exhibit 1(b)
Sears Roebuck Acceptance Corp.
$ Medium-Term Notes Series
DISTRIBUTION AGREEMENT
, 199
Sears Roebuck Acceptance Corp., a Delaware corporation (the
"Company"), proposes to issue and sell from time to time its
medium-term debt securities (the "Notes") in an aggregate
initial offering price up to U.S. $ (or the
equivalent in foreign currency or currency units), and agrees
with each person serving as an agent pursuant to this Agreement
(individually, an "Agent", and collectively, the "Agents") as set
forth herein. Subject to the terms and conditions stated herein,
the Company hereby (i) appoints each Agent as an agent of the
Company for the purpose of soliciting and receiving offers to
purchase Notes from the Company and (ii) agrees that whenever it
determines to sell Notes directly to any Agent as principal, it
will enter into a separate agreement (each a "Terms Agreement"),
substantially in the form of Annex I hereto, relating to such
sale in accordance with Section 2(b) hereof (unless the Company
and such Agent shall otherwise agree).
The Notes will be issued under an indenture, dated as of
, 199 (the "Indenture"), between the Company and
, as Trustee (the
"Trustee"). The Notes shall have the currency denomination,
maturities, annual interest rates (whether fixed or floating),
redemption provisions and other terms set forth in the Prospectus
referred to below as it may be amended or supplemented from time
to time. The Notes will be issued, and the terms and rights
thereof established, from time to time by the Company in
accordance with the Indenture and the Administrative Procedure
attached hereto as Annex II as it may be amended from time to
time by written agreement between the Agents and the Company (the
"Procedure") and, if applicable, will be specified in a related
Terms Agreement.
1. Each of the Company and Sears, Roebuck and Co.
("Sears") represents and warrants to, and agrees with, each Agent
that:
(a) A registration statement on Form S-3 (Registration
No. 33- ) in respect of U.S. $
aggregate principal amount (or the equivalent in foreign currency
or currency units) of debt securities of the Company, including
the Notes, has been filed with the Securities and Exchange
Commission (the "Commission") in the form heretofore delivered to
such Agent, excluding exhibits (whether or not incorporated by
reference) to such registration statement but including all
documents incorporated by reference in the prospectus included
therein, and such registration statement in such form has been
declared effective by the Commission and no stop order suspending
the effectiveness of such registration statement has been issued
and no proceeding for that purpose has been initiated or
threatened by the Commission (any preliminary prospectus included
in such registration statement being hereinafter called a
"Preliminary Prospectus;" the various parts of such registration
statement, including all exhibits thereto but excluding Form T-1,
each as amended at the time such part became effective, being
hereinafter collectively called the "Registration Statement;" the
prospectus relating to the Notes, in the form in which it has most
recently been filed with the Commission on or prior to the date of
this Agreement, being hereinafter called the
"Prospectus;" any reference herein to any Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to the
applicable form under the Securities Act of 1933, as amended (the
"Act") as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any supplement to the Prospectus
that sets forth only the terms of a particular issue of Notes being
hereinafter called a "Pricing Supplement;" any reference to any
amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any documents
filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and incorporated
therein by reference; and any reference to the Prospectus as
amended or supplemented shall be deemed to refer to the
Prospectus as amended or supplemented with respect to Notes sold
pursuant to this Agreement, in the form in which it is filed with
the Commission pursuant to Rule 424(b) of Regulation C under the
Act, including any documents incorporated by reference therein as
of the date of such filing);
(b) Except for statements in such documents which do not
constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements (i) the documents
incorporated by reference in the Prospectus, when they became
effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act
or the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder, and none of such documents, when they
became effective or were so filed, as the case may be, contained,
in the case of documents which became effective under the Act, an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and, in the case of documents
which were filed under the Exchange Act with the Commission, an
untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, and (ii) any further documents so filed and
incorporated by reference in the Prospectus, when such documents
become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain, in
the case of documents which become effective under the Act, an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and in the case of documents
which are filed under the Exchange Act with the Commission, an
untrue statement of 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 this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in
writing to the Company by any Agent expressly for use in the
Prospectus as amended or supplemented to relate to a particular
issuance of Notes; the Indenture has been duly qualified under, and
conforms in all material respects to the requirements of, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"); and
(c) Except for statements in documents incorporated
therein by reference which do not constitute part of the
Registration Statement or the Prospectus pursuant to Rule 412 of
Regulation C under the Act and after substituting therefor any
statements modifying or superseding such excluded statements, the
Registration Statement and the Prospectus conformed, and any
amendments or supplements thereto will, when they become
effective or are filed with the Commission, as the case may be,
conform, in all material respects to the requirements of the Act
and the Trust Indenture Act, and the rules and regulations of the
Commission thereunder and do not and will not, as of the
applicable effective date in the case of the Registration
Statement and any amendment thereto and as of the applicable filing
date in the case of the Prospectus and any supplement thereto,
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or
necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by
any Agent expressly for use in the Prospectus as amended or
supplemented to relate to a particular issuance of Notes.
2. The Company represents and warrants to, and agrees with,
each Agent that:
(a) Upon payment therefor as provided herein and in any
Terms Agreement, the Notes will have been duly and validly
authorized, and (assuming their due authentication by the
Trustee) will have been duly and validly issued and will be valid
outstanding obligations of the Company in accordance with their
terms, except as the same may be limited by insolvency,
bankruptcy, reorganization, or other laws relating to or
affecting the enforcement of creditors' rights or by general equity
principles, and will be entitled to the benefits of the Indenture;
(b) The issue and sale of the Notes and the compliance
by the Company with all of the provisions of the Notes, the
Indenture, this Agreement and any Terms Agreement will not
conflict with or result in any breach which would constitute a
material default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any of the property or assets
of the Company material to the Company, pursuant to the terms of,
any indenture, loan agreement or other agreement or instrument for
borrowed money to which the Company is a party or by which the
Company may be bound or to which any of the property or assets of
the Company material to the Company, is subject, nor will such
action result in any material violation of the
provisions of the Certificate of Incorporation, as amended, or the
By-Laws of the Company or, to the best of its knowledge, any
statute or any order, rule or regulation applicable to the
Company of any court or any Federal, State or other regulatory
authority or other governmental body having jurisdiction over the
Company, and no consent, approval, authorization or other order of,
or filing with, any court or any such regulatory authority or other
governmental body is required for the solicitation of offers to
purchase Notes and the issue and sale of the Notes, except as may
be required under the Act, the Exchange Act, the Trust Indenture
Act and securities laws of the various states and other
jurisdictions in which the Agents will solicit offers to purchase
Notes from the Company and will purchase Notes as
principal, as the case may be; and
(c) Immediately after the settlement of any sale of
Notes by the Company resulting from solicitation by such Agent
hereunder and immediately after any Time of Delivery (as defined
below) relating to a sale to an Agent as principal, the aggregate
principal amount of Notes which shall have been issued and sold by
the Company hereunder or under any Terms Agreement and of any debt
securities of the Company (other than such Notes) that shall have
been issued and sold pursuant to the Registration Statement will
not exceed the amount of debt securities registered under the
Registration Statement.
3. (a) On the basis of the representations and warranties
herein contained, and subject to the terms and conditions herein
set forth, each of the Agents hereby severally and not jointly
agrees to act as agent of the Company, to use its reasonable
efforts to solicit offers to purchase the Notes from the Company
upon the terms and conditions set forth in the Prospectus
relating to the Notes as amended or supplemented from time to time
and in the Procedure.
Subject to the provisions of this Section 3 and to the
Procedure, offers for the purchase of Notes may be solicited by
each Agent as agent for the Company at such time and in such
amounts as such Agent deems advisable; provided, however, that the
Company reserves the right to sell Notes directly on its own behalf
or through other agents, dealers or underwriters, and to appoint
additional persons from time to time to serve as Agents pursuant to
this Agreement.
Each Agent agrees that it will not solicit an offer to
purchase Notes or deliver any of the Notes in any jurisdiction
outside the United States of America except under circumstances
that will result in compliance with the applicable laws thereof.
Each Agent understands that no action has been taken to permit a
public offering in any jurisdiction outside the United States of
America where action would be required for such purpose. The
Agents further undertake that in connection with thedistribution of
Notes denominated in any foreign currency or currency unit, they
will as agent, directly or indirectly, not solicit offers to
purchase and as principal under any Terms Agreement or otherwise,
directly or indirectly, not offer, sell or deliver, such Notes in
or to residents of the country issuing such currency, except as
permitted by applicable law.
The Company reserves the right, in its sole discretion, to
instruct the Agents to suspend at any time, for any period of time
or permanently, the solicitation of offers to purchase the Notes.
Promptly after receipt of notice from the Company, but in any event
not less than one business day thereafter, the Agents will suspend
solicitation of offers to purchase Notes from the Company until
such time as the Company has advised them that such solicitation
may be resumed.
The Company agrees to pay each Agent, at the time of
settlement of any sale of a Note by the Company, the purchase of
which is solicited by such Agent, a commission in United States
dollars (which, in the case of Notes denominated in other than
United States dollars, shall be based upon the Market Exchange Rate
(as defined below) for such currency or currency unit at the time
of any acceptance of an offer to purchase a Note) in an amount
equal to the following percentage of the principal amount of such
Note sold (or at such other amount as may from time to time be
negotiated between such Agent and the Company):
Maturity Commission (percentage of aggregate
principal amount of Notes sold)
9 months to less than 1 year......................
1 year to less than 18 months....................
18 months to less than 2 years..................
2 years to less than 3 years.......................
3 years to less than 4 years.......................
4 years to less than 5 years.......................
5 years to less than 6 years.......................
6 years to less than 7 years.......................
7 years to less than 11 years.....................
11 years to less than 15 years...................
15 years to less than 20 years...................
20 years to 30 years..................................
Greater than 30 years............................... to be
negotiated
Notwithstanding anything herein to the contrary, if, at or prior to
the time of settlement, the Company and an Agent have entered into,
or such Agent has arranged for the Company to enter into, a
contract with respect to the sale of the currency (other than
United States dollars) or currency unit in which a Note has been
denominated and the purchase of which was solicited by such Agent,
the commission in United States dollars payable by the Company to
such Agent shall be based upon the same exchange rate set forth in
such contract.
The authorized denominations of Notes denominated in a
currency or currency unit other than United States dollars shall be
equivalent, as determined by the Market Exchange Rate for such
currency or currency unit on the business day immediately
preceding the date on which the offer for such Notes is accepted,
of U.S. $1,000 (rounded down to an integral multiple of 10,000
units of such currency or currency unit), and any larger amount.
The authorized denominations of Notes denominated in United States
dollars shall be U.S. $1,000 and any larger amount in integral
multiples of $1,000.
The "Market Exchange Rate" on a given date for a given foreign
currency means the noon buying rate in New York City for cable
transfers in such currency as certified for customs
purposes by the Federal Reserve Bank of New York on such date;
provided, however, that in the case of European Currency Units,
Market Exchange Rate means, unless otherwise agreed by the
Company and the Agents, the rate of exchange determined by the
Council of European Communities (or any successor thereto) as
published on such date or the most recently available date in the
Official Journal of the European Communities (or any successor
publication).
Unless otherwise agreed between the Company and each Agent,
each Agent shall communicate to the Company, orally or in
writing, each offer to purchase Notes received by it as Agent other
than those rejected by such Agent in accordance herewith. The
Company shall have the sole right to accept offers to
purchase Notes and may reject any proposed purchase of Notes. Each
Agent shall have the right, in its discretion reasonably exercised,
to reject any proposed purchase of Notes received by it, and any
such rejection by it shall not be deemed a breach of its agreements
contained herein.
(b) Each sale of Notes to any Agent as principal shall be
made in accordance with the terms of this Agreement and (unless the
Company and such Agent shall otherwise agree) a Terms
Agreement which will provide for the sale of such Notes. Terms
Agreements, each of which shall be substantially in the form of
Annex I hereto, may take the form of an exchange of any standard
form of written telecommunication between any Agent, the Company
and Sears, including by telecopy or telex. The Company, Sears and
any Agent who is a party to a Terms Agreement agree to
exchange executed copies of such Terms Agreement as promptly as
practicable after they have entered into such Terms Agreement
pursuant to the foregoing exchange of written telecommunication.
The Agents may utilize a selling or dealer group in connection with
the reoffering of the Notes purchased as principal.
For each sale of Notes to an Agent as principal that is not
made pursuant to a Terms Agreement, the procedural details
relating to the issue and delivery of such Notes and payment
therefor shall be as set forth in the Procedure. For each such
sale of Notes to an Agent as principal that is not made pursuant to
a Terms Agreement, the Company agrees to pay such Agent a
commission (or grant an equivalent discount) as provided in Section
3(a) and in accordance with the schedule set forth
therein or established from time to time pursuant thereto,
except as the parties otherwise agree in writing.
Each time and date of delivery of and payment for Notes to be
purchased by an Agent as principal, whether set forth in a Terms
Agreement or in accordance with the Procedure, is referred to
herein as a "Time of Delivery."
(c) Procedural details relating to the issue and delivery of
Notes, the solicitation of offers to purchase Notes, and the
payment in each case therefor, shall be as set forth in the
Procedure. The provisions of the Procedure shall apply to all
transactions contemplated hereunder other than those made
pursuant to a Terms Agreement. Each of the Agents and the
Company agrees to perform the respective duties and obligations
specifically provided to be performed by each of them in the
Procedure. The Company will furnish to the Trustee a copy of the
Procedure as from time to time in effect.
4. The documents required to be delivered pursuant to
Section 8 hereof shall be delivered at the offices of the
Company, 3711 Kennett Pike, Greenville, Delaware, at 11:00 a.m.,
New York time, on the date of this Agreement, or at such other date
and time as the Agents and the Company agree (such time and date
being referred to herein as the "Closing Date").
5. Each of the Company and Sears covenants and agrees with
each Agent:
(a) Prior to the termination of the offering of the
Notes, to make no amendment or supplement to the Registration
Statement or the Prospectus (except for a Pricing Supplement or a
supplement relating to an offering of securities other than the
Notes) without first having furnished the Agents with a copy of the
proposed form thereof and given the Agents a reasonable opportunity
to review the same; to advise the Agents promptly of any such
amendment or supplement after such Time of Delivery and furnish the
Agents with copies thereof, to prepare, with respect to any Notes
to be sold through or to such Agent pursuant to this Agreement, a
Pricing Supplement with respect to such Notes in a form previously
approved by such Agent and to file such Pricing Supplement pursuant
to Rule 424(b)(2) under the Act not later than the close of
business of the Commission on the second
business day after the date on which such Pricing Supplement is
first used or the date of determination of the offering price; and
to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company or
Sears, respectively, with the Commission pursuant to Section 13 or
14 of the Exchange Act for so long as the delivery of a
prospectus is required in connection with the offering or sale of
the Notes, and during such same period to advise the Agents,
promptly after the Company or Sears receives notice thereof, of the
time when any amendment to the Registration Statement has been
filed or has become effective or any supplement to the Prospectus
or any amended Prospectus (other than any Pricing Supplement and
any supplement relating to any offering of
securities other than the Notes) has been filed with, or mailed for
filing to, the Commission, of the issuance by the Commission of any
stop order or of any order preventing or suspending the use of any
prospectus relating to the Notes, of the suspension of the
qualification of the Notes for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or
suspending any such qualification, to use promptly its best efforts
to obtain its withdrawal;
(b) Promptly from time to time to take such action as
the Agents reasonably may request to qualify the Notes for
offering and sale under the securities laws of such jurisdictions
as the Agents may request and to comply with such laws so as to
permit the continuance of sales and dealings therein for as long as
may be necessary to complete the distribution or sale of the Notes
provided that in connection therewith neither the Company nor Sears
shall be required to qualify as a foreign corporation or to file a
general consent to service of process in any
jurisdiction;
(c) To furnish the Agents with copies of the
Registration Statement and each amendment thereto, and with copies
of the Prospectus as amended or supplemented, other than any
Pricing Supplement (except as provided in the Procedure), in the
form in which it is filed with the Commission pursuant to Rule 424
under the Act or in the form first used to confirm sales which was
not required to be filed pursuant to Rule 424 under the Act, in
such quantities as the Agents may from time to time reasonably
request, and, if the delivery of a prospectus is required at any
time in connection with the offering or sale of the Notes
(including Notes purchased from the Company by such Agent as
principal) and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such same period to
amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust
Indenture Act, to (i) notify the Agents to suspend solicitation of
offers to purchase Notes from the Company (and, if so notified, the
Agents shall promptly cease such
solicitations), (ii) prepare and cause to be filed with the
Commission, after having furnished the Agents with a copy of the
proposed form and given the Agents a reasonable opportunity to
review the same, an amendment or supplement to the Registration
Statement or the Prospectus as then amended or supplemented that
will correct such statement or omission or effect such compliance
and (iii) supply such Prospectus as then amended or supplemented to
the Agents in such quantities as the Agents may reasonably request;
if such amendment or supplement, and any documents, certificates
and opinions furnished to the Agents pursuant to Section 8 in
connection with the preparation or filing of such amendment or
supplement are reasonably satisfactory in all
respects to the Agents, the Agents will, upon the filing of such
amendment or supplement with the Commission and upon the
effectiveness of an amendment to the Registration Statement if such
an amendment is required, resume the Agents obligation to solicit
offers to purchase Notes hereunder; if such amendment or
supplement, or any documents, certificates and opinions furnished
to the Agents pursuant to Section 8 in connection with the
preparation or filing of such amendment or supplement, are not
satisfactory to the Agents, the Agents will as promptly as
reasonably practicable notify the Company and Sears in writing;
(d) To make generally available to its security
holders, in accordance with the provisions of Rule 158 under the
Act or otherwise, as soon as practicable, but in any event not
later than forty-five days after the end of the fourth full fiscal
quarter (ninety days in the case of the last fiscal
quarter in any fiscal year) following the fiscal quarter ending
after the latest of (x) the effective date of the Registration
Statement, (y) the effective date of the post-effective amendment
thereto hereinafter referred to and (z) the date of filing of the
report hereinafter referred to, an earning statement of the Company
and Sears and its consolidated subsidiaries,
respectively, (which need not be audited) complying with Section
11(a) of the Act and covering a period of at least twelve
consecutive months beginning after the latest of (i) the
effective date of such Registration Statement, (ii) the effective
date of the post-effective amendment, if any, to such
Registration Statement (within the meaning of Rule 158) and (iii)
the date of filing of the last report of the Company or Sears
incorporated by reference into the Prospectus (within the meaning
of Rule 158); and
(e) That each acceptance by the Company of an offer to
purchase Notes hereunder shall be deemed to be an affirmation to
such Agent that the representations and warranties of the
Company and Sears contained in or made pursuant to this
Agreement are true and correct as of the date of such acceptance as
though made at and as of such date, and an undertaking that, if a
settlement occurs with respect to such acceptance, such
representations and warranties will be true and correct as of such
settlement date as though made at and as of such date
(except that such representations and warranties shall be deemed to
relate to the Registration Statement and the Prospectus as amended
and supplemented relating to such Notes).
6. The Company covenants and agrees with each Agent that,
except as may otherwise be specified in any Terms Agreement, during
the period beginning from the date of any Terms Agreement and
continuing to and including the earlier of (i) the
termination of the trading restrictions for the Notes purchased
thereunder, of which termination such Agent or Agents party to the
Terms Agreement agree to give the Company prompt notice confirmed
in writing and (ii) the Time of Delivery for such Notes, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company which (i) mature nine months or more
after such Time of Delivery, (ii) mature within six months of the
maturity of such Notes and (iii) are
denominated in the same currency or currency unit specified in the
Terms Agreement, without the prior written consent of such Agent or
Agents, which consent shall not be unreasonably
withheld, except pursuant to arrangements of which such Agent or
Agents have been advised by the Company prior to the time of
execution of such Terms Agreement, which advice is confirmed in
writing (which may be by telecopy or telex, receipt
acknowledged) to such Agent or Agents by the end of the business
day following the date of such Terms Agreement.
7. The Company covenants and agrees with each Agent that the
Company will pay or cause to be paid, whether or not any sale of
Notes is consummated, the following: (i) the fees and
expenses of the Company's counsel and accountants in connection
with the registration of the Notes under the Act and all other
expenses in connection with the preparation, printing and filing of
the Registration Statement, any Preliminary Prospectus, the
Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Agents; (ii) the
fees and expenses of counsel for the Agents, which counsel has been
approved by the Company, incurred heretofore or hereafter in
connection with the transactions contemplated hereunder; (iii) the
cost of printing or reproducing this Agreement, any Terms
Agreement, any Indenture, any Blue Sky and Legal Investment
Memoranda and any other documents in connection with the
offering, purchase, sale and delivery of the Notes; (iv) all
expenses in connection with the qualification of the Notes for
offering and sale under state securities laws as provided in
Section 4(b) hereof, including fees and disbursements of counsel
for the Agents in connection with such qualification and in
connection with the Blue Sky and legal investment surveys; (v) any
fees charged by security rating services for rating the Notes; (vi)
any filing fees incident to any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of
the Notes; (vii) the cost of preparing the Notes; (viii) the fees
and expenses of any Trustee and any
transfer or paying agent of the Company and the fees and
disbursements of counsel for any Trustee or such agent in
connection with any Indenture and the Notes; (ix) on a monthly
basis all out-of-pocket expenses (including without limitation
advertising expenses) incurred by such Agent connected with the
solicitation of offers to purchase and the sale of Notes so long as
such expenses have been approved by the Company; and (x) all other
costs and expenses incident to the performance of the Company's
obligations hereunder (other than costs and expenses incurred by
any Agent) which are not otherwise specifically provided for in
this Section 7.
8. The obligation of each Agent, as agent of the Company, at
any time ("Solicitation Time") to solicit offers to purchase the
Notes and the obligation of each Agent to purchase Notes as
principal pursuant to any Terms Agreement or otherwise shall in
each case be subject, in such Agent's discretion, to the
condition that all representations and warranties and other
statements of the Company or Sears herein are true and correct at
and as of the Closing Date, as of the date of the
effectiveness of any amendment to the Registration Statement
(including the filing of any document incorporated by reference
therein), as of the date any supplement to the Prospectus is filed
with the Commission, as of any Time of Delivery, as of each
acceptance by the Company of an offer to purchase Notes hereunder
and as of each settlement date relating to such sale, the
condition that each of the Company and Sears shall have performed
all of its obligations hereunder theretofore to be performed, and
the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part
of the Commission shall have been complied with to the Agents
reasonable satisfaction;
(b) All corporate proceedings and related matters in
connection with the organization of the Company, the validity of
the Indenture and the registration, authorization, issue, sale and
delivery of the Notes shall have been satisfactory to the Agents'
counsel, and such counsel shall have been furnished with such
papers and information as they may reasonably have
requested to enable them to pass upon the matters referred to in
this Section 8(b);
(c) Counsel to the Company and Sears, who may be an
employee of the Company or of Sears, shall have furnished to the
Agents such counsel's written opinion, dated the Closing Date, each
Time of Delivery and the date of effectiveness of each amendment or
the filing of each supplement to the Registration Statement or the
Prospectus (including the filing under the Act or the Exchange Act
of documents incorporated by reference in the Prospectus as amended
or supplemented but excluding amendments or supplements (i)
relating to an offering of securities other than the Notes, (ii)
constituting a Pricing Supplement, (iii) setting forth or
incorporating by reference financial statements or other
information as of and for a fiscal quarter or (iv) relating solely
to the incorporation by reference of Sears proxy statement for its
annual meeting of shareholders or of a filing by the Company or
Sears of a Current Report on Form 8-K under the
Exchange Act unless in the case of clauses (iii) or (iv) above, in
such Agent's reasonable judgment, such financial statements or
other information contained in such documents are of such a
character that an opinion of counsel should be furnished), as the
case may be, in form and substance satisfactory to the Agents in
the Agents' reasonable judgement to the effect that:
(i) Each of the Company and Sears has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its respective state of incorporation;
(ii) The authorized capital stock of the Company
consists of 500,000 shares of common stock, par value $100 per
share, all of the issued and outstanding shares of which are owned
by Sears, Roebuck and Co., and the authorized capital stock of
Sears is as set forth or incorporated by reference in the
Registration Statement;
(iii) SRAC is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended;
(iv) Each of this Agreement and any applicable Terms
Agreement has been duly authorized, executed and delivered on the
part of the Company, and this Agreement has been duly authorized,
executed and delivered on the part of Sears;
(v) The issue and sale of the Notes and the
compliance by the Company with all of the provisions of the Notes,
the Indenture, this Agreement and any applicable Terms Agreement
will not (a) conflict with or result in any breach which would
constitute a material default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any of the
property or assets of the Company, material to the Company,
pursuant to the terms of, any indenture, loan agreement or other
agreement or instrument for borrowed money known to such counsel to
which the Company is a party or by which the Company may be bound
or to which any of the property or assets of the Company, material
to the Company, is subject, (b) result in any material violation of
the provisions of the Certificate of
Incorporation, as amended, or the By-Laws of the Company or (c) to
the best of the knowledge of such counsel, result in any material
violation of any statute or any order, rule or
regulation applicable to the Company of any court or any Federal,
State or other regulatory authority or other governmental body
having jurisdiction over the Company, other than the Act, the
Exchange Act, the Trust Indenture Act, and the rules and
regulations pursuant to each such act, and other than the
securities laws of the various states or other jurisdictions which
are applicable to the issue and sale of the Notes; and, to the best
knowledge of such counsel, no consent, approval,
authorization or other order of, or filing with, any court or any
such regulatory authority or other governmental body is required
for the issue and sale of the Notes except as may be required under
the Act, the Exchange Act, the Trust Indenture Act and securities
laws of the various states or other jurisdictions which are
applicable to the issue and sale of the Notes;
(vi) The Indenture has been duly authorized,
executed and delivered on the part of the Company and, as to the
Company, is a valid and binding instrument in accordance with its
terms except as the foregoing may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or
affecting the enforcement of creditors' rights or by general equity
principles, and has been qualified under the Trust
Indenture Act; the Notes have been duly authorized and (assuming
due authentication by the Trustee) when duly executed, issued and
delivered pursuant to the Indenture and any Terms Agreement, will
constitute valid and binding obligations of the Company in
accordance with their terms, entitled to the benefits of the
Indenture, except as the foregoing may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or
affecting the enforcement of creditors' rights or by general equity
principles;
(vii) The Fixed Charge Coverage and Ownership
Agreement has been duly authorized, executed and delivered by the
parties thereto and is a valid and binding instrument in
accordance with its terms except as the same may be limited by
insolvency, bankruptcy, reorganization or other laws relating to or
affecting the enforcement of creditors' rights or by general equity
principles;
(viii) Such counsel does not know of any
pending legal or governmental proceedings required to be
described in the Prospectus as amended or supplemented which are
not described as required;
(ix) Except for statements in such documents which
do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements, the documents incorporated by
reference in the Prospectus as amended or supplemented (other than
the financial statements and related schedules, the
analyses of operations and financial condition and other
financial, statistical and accounting data therein, as to which
such counsel need express no opinion), when they became
effective or were filed with the Commission, as the case may be,
complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder;
(x) Except for statements in such documents which
do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements, the Registration Statement
and the Prospectus as amended or supplemented (excluding the
documents incorporated by reference therein) (other than the
financial statements and related schedules, the analyses of
operations and financial condition and other financial,
statistical and accounting data therein, as to which such counsel
need express no opinion) comply as to form in all material
respects with the requirements of the Act and the rules and
regulations thereunder; the answers in the Registration Statement
to Items 9 and 10 (insofar as it relates to such counsel) of Form
S-3 are to the best of such counsel's knowledge accurate
statements or summaries of the matters therein set forth and fairly
present the information called for with respect to those matters by
the Act and the rules and regulations thereunder; and
(xi) Such counsel does not know of any contract or
other document to which the Company or Sears is a party required to
be filed as an exhibit to the Registration Statement or
required to be incorporated by reference into the Prospectus as
amended or supplemented or required to be described in the
Prospectus as amended or supplemented which has not been so filed,
incorporated by reference or described.
In rendering such opinion, such counsel may rely to the
extent such counsel deems appropriate upon certificates of
officers or other executives of the Company, Sears and its
business groups and subsidiaries and of public officials as to
factual matters and upon opinions of other counsel. In rendering
the opinion referred to in subdivision (v) above, such counsel need
not express an opinion as to whether, with respect to any Notes
denominated in a currency other than United States dollars, a court
located in the United States of America would grant a judgment
relating to the Notes in other than United States
dollars, nor an opinion as to the date which any such court would
utilize for determining the rate of conversion into United States
dollars in granting such judgment. Such counsel shall also state
that: (a) nothing has come to such counsel's attention which has
caused such counsel to believe that any of the documents referred
to in subdivision (ix) above (other than the financial
statements, the analyses of operations and financial condition and
other financial, statistical and accounting data therein, as to
which such counsel need express no belief), in each case after
excluding any statement in any such document which does not
constitute part of the Registration Statement or the Prospectus as
amended or supplemented pursuant to Rule 412 of Regulation C under
the Act and after substituting therefor any statement modifying or
superseding such excluded statement, when such documents became
effective or were filed, as the case may be, contained, in the case
of documents which became effective under the Act, an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and, in the case of documents which were
filed under the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and
(b) nothing has come to such counsel's attention which has caused
such counsel to believe that the Registration Statement or
Prospectus as amended or supplemented (other than the financial
statements, the analyses of operations and financial condition and
other financial, statistical and accounting data therein, as to
which such counsel need express no belief) contains an untrue
statement of a material fact or omits to state a material fact
required to be stated therein or
necessary to make the statements therein not misleading;
(d) On the Closing Date, each Time of Delivery and the
date of effectiveness of each amendment or the filing of each
supplement to the Registration Statement or the Prospectus
setting forth or incorporating by reference amended or
supplemental financial information, as the case may be, the
independent certified public accountants who have certified the
financial statements of the Company and Sears and its
subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to the Agents a letter
or letters, dated the Closing Date or such applicable date, as the
case may be, in form and substance satisfactory to the Agents, to
the effect set forth in Annex III hereto (modified in the case of
amended or supplemented financial information to reflect such
amended and supplemental financial information included or
incorporated by reference in the Registration
Statement and the Prospectus as amended or supplemented to the date
of such letter, provided that if the Registration Statement or the
Prospectus is amended or supplemented solely to include or
incorporate by reference unaudited quarterly financial
information, the scope of such letter, which shall be
satisfactory in form and substance to such Agent, may be limited to
relate to such unaudited financial information unless any other
accounting, financial or statistical information included or
incorporated by reference therein is of a character that, in the
reasonable judgment of such Agent, such letter should address such
other information);
(e) (i) The Company and Sears shall not have
sustained, after the date of the latest audited financial
statements included or incorporated by reference in the
Prospectus and (A) prior to the Closing Date, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as contemplated in the Prospectus as amended or supplemented
through the date of this Agreement and (B) prior to each Time of
Delivery, any such loss or interference, otherwise than as set
forth or contemplated in the Prospectus as amended or supplemented
through the date that the Agent agreed to purchase such Notes as
principal; and (ii) since the respective dates as of which
information is given in the Prospectus as amended or supplemented
and (A) prior to the Closing Date, there shall not have been any
material change in the capital stock accounts or long-term debt of
the Company or any material adverse change in the general affairs,
financial position, stockholders' equity or results of operations
of the Company, otherwise than as set forth or contemplated in the
Prospectus as amended or supplemented through the date of this
Agreement and (B) prior to each Time of Delivery, there shall not
have been any such change, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented through
the date that the Agent agreed to purchase such Notes as principal,
the effect of which, in any such case described in clause (i) or
(ii), in the judgment of such Agent makes it impracticable or
inadvisable to proceed with the
solicitation by such Agent of offers to purchase Notes from the
Company or the purchase by such Agent of Notes from the Company as
principal, as the case may be;
(f) During the period in which the Agents are
soliciting offers to purchase Notes, including the period between
the date that any Agent agreed to purchase such Notes as
principal and the related Time of Delivery, no downgrading shall
have occurred in the rating accorded the Company's or Sears debt
securities by Moody's Investors Service, Inc. or Standard & Poor's
Corporation; provided, however, that this Section 6(f) shall not
apply to any such rating agencies which shall have notified the
Company of the downgrading in the rating of such debt securities
and of which the Company shall have given the Agents written notice
prior to the execution of the Terms
Agreement;
(g) During the period in which the Agents are
soliciting offers to purchase Notes, including the period between
the date that any Agent agreed to purchase such Notes as
principal and the related Time of Delivery, neither (i) the United
States shall have become engaged in the outbreak or
escalation of hostilities involving the United States or there has
been a declaration by the United States of a national
emergency or a declaration of war, (ii) a banking moratorium shall
have been declared by either Federal or New York State authorities
or, in the case of Notes denominated in other than United States
dollars, by the authorities of the country of the currency in which
such Notes are denominated, (iii) trading in securities generally
on the New York Stock Exchange shall have been suspended nor
limited or minimum prices shall have been
established by such Exchange, nor (iv) in the case of Notes
denominated in other than United States dollars, any change
involving such currency exchange rates, exchange controls,
taxation or similar matters, any of which events, in the Agents'
judgment, renders it inadvisable to proceed with the
solicitation by the Agents of offers to purchase Notes from the
Company or the purchase by the Agents of Notes from the Company as
principal, as the case may be; and
(h) Each of the Company and Sears shall have furnished
or caused to be furnished to the Agents at the Closing Date, each
Time of Delivery and the date of effectiveness of each amendment or
the filing of each supplement to the Registration Statement or the
Prospectus (including the filing under the Act or the
Exchange Act of documents which are incorporated by reference in
the Prospectus as amended or supplemented but excluding
amendments or supplements (i) relating to an offering of
securities other than the Notes, (ii) constituting a Pricing
Supplement, or (iii) relating solely to the incorporation by
reference of Sears proxy statement for its annual meeting of
shareholders or of a filing by the Company or Sears of a Current
Report on Form 8-K under the Exchange Act, unless in the case of
clause (iii) above, in such Agent's reasonable judgment, the
information contained in such documents is of such a character that
certificates of officers referred to below should be
furnished, as the case may be) certificates of officers of the
Company and Sears satisfactory to the Agents, as to the accuracy at
and as of the Closing Date or such applicable date, as the case may
be, of the representations, warranties and agreements of the
Company and Sears, respectively, herein and as to the
performance by each of the Company and Sears of all its
obligations hereunder to be performed at or prior to the Closing
Date or such applicable date, as the case may be, and the
Company shall have also furnished the Agents similar
certificates satisfactory to the Agents as to the matters set forth
in subdivision (a) of this Section 8.
9. (a) The Company will indemnify and hold harmless each
Agent against any losses, claims, damages or liabilities, joint or
several, to which such Agent may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any
material fact contained in any Preliminary Prospectus, the
Registration Statement, the Prospectus or the Prospectus as amended
or supplemented, or any amendment or supplement thereto furnished
by the Company or Sears, or arise out of or are based upon the
omission or alleged omission to state therein a
material fact required to be stated therein or (in the case of the
Registration Statement or the Prospectus as amended or
supplemented or any amendment or supplement thereto) necessary to
make the statements therein not misleading or (in the case of any
Preliminary Prospectus) necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; and will reimburse each Agent for any legal or other
expenses reasonably incurred by such Agent in connection with
investigating or defending any such action or claim; provided,
however, that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, or the Registration Statement, the Prospectus or the
Prospectus as amended or supplemented or any such amendment or
supplement in reliance upon and in conformity with written
information furnished to the Company by the Agents expressly for
use therein; and provided, further, that the Company shall not be
liable to any Agent or any person controlling such Agent under the
indemnity agreement in this subdivision (a) with respect to the
Preliminary Prospectus or the Prospectus or the Prospectus as
amended or supplemented or any amendment or supplement thereto, as
the case may be, to the extent that any such loss, claim, damage or
liability of such Agent or controlling person results solely from
the fact that such Agent sold Notes to a person to whom there was
not sent or given, at or prior to the written confirmation of such
sale, a copy of the Prospectus (excluding documents incorporated by
reference) or of the Prospectus as then amended or supplemented
(excluding documents incorporated by reference), whichever is most
recent, if the Company has
previously furnished copies thereof to such Agent.
(b) Each Agent will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the
Company may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus, or the Prospectus as amended or
supplemented, or any amendment or supplement thereto, or arise out
of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or (in the
case of the Registration Statement or the Prospectus or the
Prospectus as amended or supplemented or any amendment or
supplement thereto) necessary to make the statements therein not
misleading or (in the case of any Preliminary Prospectus)
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, in each
case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus or the Registration
Statement or the Prospectus or the Prospectus as amended or
supplemented or such amendment or supplement in
reliance upon and in conformity with written information
furnished to the Company by such Agent expressly for use
therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim.
(c) Within a reasonable period after receipt by an
indemnified party under subdivision (a) or (b) above of notice of
the commencement of any action with respect to which
indemnification is sought under such subdivision or contribution
may be sought under subdivision (d) below, such indemnified party
shall notify the indemnifying party in writing of the
commencement thereof. In case any such action shall be brought
against any indemnified party, the indemnifying party shall be
entitled to participate in, and, to the extent that it shall wish,
jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party for any legal or other
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation.
(d) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subdivision (a) or (b)
above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the
contributing Agent on the other from the offering of the Notes and
also the relative fault of the Company and Sears on the one hand
and the contributing Agent on the other in connection with the
statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the
contributing Agent on the other shall be deemed to be in the same
proportion as the total net proceeds from the sale of Notes (before
deducting expenses) received by the Company bear to the total
commissions or discounts received by the contributing Agent. The
relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the
Company or Sears on the one hand or the contributing Agent on the
other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission of the Company or Sears on the one hand and the
contributing Agent on the other hand. With respect to any
Agent, such relative fault shall also be determined by reference to
the extent (if any) to which such losses, claims, damages or
liabilities (or actions in respect thereof) with respect to any
Preliminary Prospectus result from the fact that such Agent sold
Notes to a person to whom there was not sent or given, at or prior
to the written confirmation of such sale, a copy of the Prospectus
(excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding
documents incorporated by reference) if the Company has
previously furnished copies thereof to such Agent. The Company and
the contributing Agent agree that it would not be just and
equitable if contribution pursuant to this subdivision (d) were
determined by per capita allocation (even if all Agents 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 subdivision (d). The
amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subdivision (d) shall be deemed
to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the
provisions of this subdivision (d), no Agent shall be required to
contribute any amount in excess of the amount by which the total
price at which the Notes purchased by or through such Agent were
sold exceeds the amount of any damages which such Agent has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent
misrepresentation. The obligations of each of the Agents under
this subdivision (d) to contribute are several in proportion to the
respective purchases made by or through it to which such loss,
claim, damage or liability (or action in respect thereof) relates
and are not joint.
(e) The obligations of the Company under this Section 9 shall
be in addition to any liability which the Company may otherwise
have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Agent within
the meaning of the Act; and each Agent's obligations under this
Section 9 shall be in addition to any liability which such Agent
may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company or Sears
and to each person, if any, who controls the Company within the
meaning of the Act.
10. In soliciting offers to purchase Notes from the Company
and in performing the other obligations of such Agent hereunder
(other than in respect of any purchase by an Agent as principal,
pursuant to a Terms Agreement or otherwise), each Agent is
acting solely as agent for the Company and not as principal. Each
Agent will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase
Notes from the Company was solicited by such Agent and has been
accepted by the Company, but such Agent shall not have any
liability to the Company in the event such purchase is not
consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer it has
accepted, the Company shall hold each Agent harmless against any
loss, claim or damage arising from or as a result of such
default by the Company.
11. The respective indemnities, agreements,
representations, warranties and other statements by any Agent, the
Company and Sears set forth in or made pursuant to this Agreement
shall remain in full force and effect regardless of any
investigation (or any statement as to the results thereof) made by
or on behalf of any Agent, the Company, Sears, or any officer or
director or any controlling person of the Company, Sears or any
Agent, and shall survive each delivery of and payment for any of
the Notes.
12. The provisions of this Agreement relating to the
solicitation of offers to purchase Notes from the Company may be
suspended or this Agreement may be terminated at any time by the
Company as to any or all Agents or by any Agent insofar as this
Agreement relates to such Agent upon the giving of written
notice of such suspension or termination to such Agent or the
Company, as the case may be. Unless otherwise agreed by the
respective parties, any such suspension or termination shall be
effective immediately with respect to the party giving such notice
and, in the case of the party receiving such notice, at the close
of business on the first business day following the receipt of such
notice. In the event of such suspension or termination with
respect to any Agent, (x) this Agreement shall remain in full force
and effect with respect to any Agent as to which such suspension or
termination has not occurred, and (y) the Company shall not have
any liability to such Agent and such Agent shall not have any
liability to the Company, except as provided in any Terms
Agreements and in the fifth paragraph of Section 3(a), Section 7,
Section 9, Section 10 and Section 11.
13. Except as otherwise specifically provided herein or in
the Procedure, all statements, requests, notices and advices
hereunder shall be in writing, or by telephone if promptly
confirmed in writing, and if to an Agent shall be sufficient in all
respects when delivered or sent by facsimile transmission or
registered mail to such Agent at the address or facsimile
transmission number set forth in the Appointment and Acceptance of
Agent relating to the appointment of such Agent, and if to the
Company shall be sufficient in all respects when delivered or sent
by facsimile transmission or registered mail to the Company at 3711
Kennett Pike, Greenville, Delaware 19807,
Attention: Richard F. Kotz, Secretary, Facsimile Transmission No.
(302) 888-3150, and if to Sears shall be sufficient in all
respects when delivered or sent by facsimile transmission or
registered mail to Sears at 3333 Beverly Road, Hoffman Estates,
Illinois 60179, Attention: Senior Vice President and General
Counsel, Facsimile Transmission No. (847) 286-2471 with a copy to
the Vice President and Treasurer, Facsimile Transmission No. (847)
286-3690. Upon request of any party hereto, any
statements, requests, notices and advices transmitted by
facsimile shall be promptly followed by delivery of executed
documents by registered mail.
14. This Agreement and any Terms Agreement shall be binding
upon, and inure solely to the benefit of, each Agent, the
Company and Sears, and to the extent provided in Section 9, Section
10 and Section 11 hereof, the officers and directors of the Company
and Sears and any person who controls any Agent or the Company, and
their respective heirs, executors,
administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this
Agreement or any Terms Agreement. No purchaser of any of the Notes
through or from any Agent hereunder shall be deemed a successor or
assign by reason merely of such purchase.
15. Time shall be of the essence in this Agreement and any
Terms Agreement. As used herein, the term "business day" shall
mean any day when the office of the Commission in Washington, D.C.
is normally open for business or each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a legal holiday for banking
institutions in any of the City of Chicago, The City of New York or
the City of Wilmington.
16. This Agreement and any Terms Agreement shall be
governed by, and construed in accordance with, the internal laws of
the State of New York.
17. This Agreement (including such Appointments and
Acceptances of Agent as may be executed and delivered by the
Company and Sears and accepted by one or more Agents from time to
time) and any Terms Agreement may be executed by any one or more of
the parties hereto and thereto in any number of counterparts, each
of which shall be an original, but all of such respective
counterparts shall together constitute one and the same
instrument.
<PAGE>
APPOINTMENT AND ACCEPTANCE OF AGENT
Each agent designated below is hereby appointed as an Agent on
the terms and conditions set forth in the Distribution
Agreement. Upon acceptance of such appointment by signing and
returning to us three counterparts hereof, the Distribution
Agreement shall constitute a binding agreement between the
Company, Sears and each such Agent in accordance with its terms.
Very truly yours,
SEARS ROEBUCK ACCEPTANCE CORP.
By:
_______________________
SEARS, ROEBUCK AND CO.
By:
_____________________________
Agents Designated Hereby:
Accepted in New York, New York, as of the date set forth on the
first page of the Distribution Agreement:
Address:
Facsimile Transmission No.:
[Other terms of Agent's appointment, if any, including the
duration of appointment if limited other than pursuant to
Section 12]
Accepted in New York, New York, as of the date [set forth on the
first page of the Distribution Agreement]:
By:_________________________________________
<PAGE>
ANNEX I
Sears Roebuck Acceptance Corp.
$ Medium Term Notes Series __
TERMS AGREEMENT
_______________________
_______________________
_______________________
Dear Sirs: ,199
Sears Roebuck Acceptance Corp. (the "Company") proposes,
subject to the terms and conditions stated herein and in the
Distribution Agreement, dated ___________, 199_ (the
"Distribution Agreement"), between the Company and Sears,
Roebuck and Co. ("Sears") on the one hand and the Agents
thereunder on the other, to issue and sell to you the securities
specified in the Schedule hereto (the "Purchased Notes"). Each of
the provisions of the Distribution Agreement not specifically
related to the solicitation by such firms, as agents of the
Company, of offers to purchase Notes is incorporated herein by
reference in its entirety, and shall be deemed to be part of this
Agreement to the same extent as if such provisions had been set
forth in full herein, provided that for purposes of this
Agreement all references in the Distribution Agreement to the
"Agents" shall be deemed to refer to you alone. Nothing
contained herein or in the Distribution Agreement shall make any
party hereto an agent of the Company or make such party subject to
the provisions in the Distribution Agreement relating to the
solicitation of offers to purchase securities from the Company,
solely by virtue of its execution of this Terms Agreement. Each of
the representations and warranties set forth therein shall be
deemed to have been made at and as of the date of this Terms
Agreement, except that each representation and warranty in
Sections 1 and 2 of the Distribution Agreement which makes
reference to the Prospectus shall be deemed to be a
representation and warranty as of the date of the Distribution
Agreement in relation to the Prospectus (as therein defined), and
also a representation and warranty as of the date of this Terms
Agreement in relation to the Prospectus as amended and
supplemented to relate to the Purchased Notes. Unless otherwise
defined herein, terms defined in the Distribution Agreement are
used herein as therein defined.
An amendment to the Registration Statement, or a supplement to
the Prospectus, as the case may be, relating to the Purchased
Notes, in the form heretofore delivered to you is now proposed to
be filed with, or in the case of a supplement, mailed for filing
to, the Commission.
Subject to the terms and conditions set forth herein and in
the Distribution Agreement incorporated herein by reference, the
Company agrees to issue and sell to you and you agree to
purchase from the Company the Purchased Notes, at the time and
place, in the principal amount and at the purchase price set forth
in the Schedule hereto.<PAGE>
If the foregoing is in accordance with your understanding,
please sign and return to us two counterparts hereof, and upon
acceptance hereof by you this letter and such acceptance hereof,
including those provisions of the Distribution Agreement
incorporated herein by reference, shall constitute a binding
agreement between you, the Company and Sears.
SEARS ROEBUCK ACCEPTANCE CORP.
By:
SEARS, ROEBUCK AND CO.
By:
Accepted:
[_______________________________________
By: ]
<PAGE>
SCHEDULE TO ANNEX I
Title of Purchased Notes:
[Medium-Term Notes, Series I]
[ % Notes due ]
Aggregate Principal Amount:
[$ or units of other Specified Currency]
[Currency Swap or Forward Arrangements:]
[Price to Public:]
Purchase Price by :
% of the principal amount of the Purchased Notes [, plus
accrued interest from to ] [and accrued
amortization, from to ]
Specified Funds for Payment of Purchase Price:
immediately available funds
Indenture:
Indenture, dated as of May 15, 1995, as supplemented to the
date hereof, between the Company and The Chase Manhattan Bank,
N.A., as Trustee
Form of Purchased Notes:
[Certificated form only][Global form only]
Time of Delivery:
Closing Location:
Maturity:
Interest Rate:
[ %] [Specify floating rate provisions, if any]
Interest Payment Dates:
[months and dates]
Documents to be Delivered:
The following documents referred to in the Distribution
Agreement shall be delivered as a condition to the Closing:
[(1) The opinion referred to in Section 8(c).]
[(2) The accountants' letter referred to in Section
8(d).]
[(3) The officers' certificate referred to in Section
8(h).]
Lock-Out Provisions:
[Describe modifications, if any, to the lock-out provisions
set forth in Section 6 of the Distribution Agreement.]<PAGE>
Syndicate Provisions:
[Set forth any provisions relating to underwriters' default
and step-up of amounts to be purchased by underwriters acting with
]
<PAGE>
ANNEX II
Sears Roebuck Acceptance Corp.
ADMINISTRATIVE PROCEDURE
Medium-term notes (the "Notes") in the aggregate initial
offering price of up to $ are to offered from
time to time by Sears Roebuck Acceptance Corp. (the
"Company") through agents of the Company (together, in such
capacity, the "Agents"). Each Agent has agreed to use its
reasonable efforts to solicit offers to purchase Notes directly
from the Company (an Agent, in relation to a purchase of a
particular Note by a purchaser solicited by such Agent, being
herein referred to as the "Selling Agent") and may also purchase
Notes from the Company as principal (an Agent, in relation to a
purchase of a Note by such Agent as principal other than
pursuant to a Terms Agreement being herein referred to as the
"Purchasing Agent"). The Notes are being sold pursuant to a
Distribution Agreement, dated , 199 (the
"Distribution Agreement"), between the Company, Sears, Roebuck and
Co. ("Sears") and the Agents, to which this Administrative
Procedure is attached as Annex II.
The Notes will be issued pursuant to an Indenture, dated as of
, 199 (the "Indenture"),
between the Company and ,
as Trustee (the "Trustee").
Unless otherwise defined herein, terms defined in the
Indenture or the Notes shall be used herein as therein defined.
In the case of purchases of Notes by any Agent as principal,
the relevant terms and settlement details related thereto,
including the Time of Delivery referred to in the first
paragraph of Section 8, will (unless the Company and such Agent
otherwise agree) be set forth in a Terms Agreement entered into
between such Agent and the Company and Sears pursuant to the
Distribution Agreement.
The procedures to be followed during, and the specific terms
of, the solicitation of offers by the Agents and the sale as a
result thereof by the Company are explained below. The
procedures are subject, and are qualified in their entirety by
reference, to all of the respective provisions of the
Distribution Agreement and the Indenture.
The Company will advise each Agent in writing of those persons
handling administrative responsibilities ("Designated Persons")
with whom such Agent is to communicate regarding offers to
purchase Notes and the details of their delivery.
I. General Procedures
Registration: Notes will be issued only in fully registered
form and will be either (a) Book- Entry Notes represented by
one or more global notes (each a "Global Note") held by the
Trustee, as agent for The Depository Trust Company ("DTC") and
recorded in the book-entry system maintained by DTC or (b)
Certificated Notes delivered in certificated form to the Selling
Agent or Purchasing Agent. All Notes will be issued as
Book-Entry Notes except as otherwise approved in advance by the
Company and except that non-U.S. dollar denominated Notes will be
issued as Certificated Notes only unless otherwise specified in a
Prospectus Supplement or Pricing Supplement.
Maturities: Each Note will mature on a date, selected by
the purchaser and agreed to by the Company, which will be at least
nine months but not more than thirty years from the date of
original issuance by the Company of such Note (the "Settlement
Date").
Price to Public: Each Note will be issued at the
percentage of principal amount specified in the Prospectus (as
defined in Section 1(a) of the Distribution Agreement) relating to
the Notes.
Currencies: Notes will be denominated in U.S. dollars or in
such other currency or currency unit as is specified in the
Prospectus (the "Specified Currency").
Denominations: The denomination of any Book-Entry, Global or
Certificated Note will be a minimum of U.S. $1,000 or any amount in
excess thereof in integral multiples of $1,000 or the
equivalent, as determined pursuant to the provisions of the
Indenture, of U.S. $1,000 (rounded down to an integral multiple of
1,000 units of such Specified Currency) and any amounts in excess
thereof.
Interest Payments: As specified in the Indenture and the Form
of Note.
Acceptance of
Offers: Each Agent will promptly advise the Company by
telephone or other appropriate means of offers to purchase Notes
received by it other than those rejected by such Agent. Each Agent
may, in its discretion reasonably exercised, reject any offer
received by it. Each Agent also may make offers to the Company to
purchase Notes as a Purchasing Agent in accordance with Section
2(b) of the Distribution Agreement. The Company will have the sole
right to accept offers to purchase Notes and may reject any such
offer.
If the Company accepts an offer to purchase
Notes, it will confirm such acceptance in writing to the Selling
Agent or
Purchasing Agent, as the case may be. If the Company rejects an
offer, it will promptly notify the Agent involved.
Filing and Delivery
of Prospectus: If the Company accepts an offer to
purchase a Note, the Company will prepare a Pricing Supplement
reflecting the terms of such Note and will arrange to have a
Pricing Supplement filed with the Securities and Exchange
Commission (the "Commission") as soon as practicable after the
preparation thereof and will supply at least one such Pricing
Supplement to the Selling Agent or the Purchasing Agent, as the
case may be, not later than 5:00 p.m., New York City time, on the
Business Day following the date of acceptance of such offer.
With respect to each Note sold pursuant to the
Distribution Agreement, the Selling Agent shall send a copy of the
Prospectus as most recently amended or supplemented
(together with the Pricing Supplement relating to such Note) to the
purchaser or its agent prior to or together with the delivery of
(a) the written confirmation of sale (including, in the case of a
book-entry security, the confirmation through DTC's
Institutional Delivery System) or (b) the delivery of such Note,
whichever is earlier.
Confirmation: For each offer accepted by the Company, the
Selling Agent will issue a written confirmation to each
purchaser containing the Sale Information (as defined below), plus
delivery and payment instructions.
Currency Swaps: Unless otherwise requested by the
Company, each time an Agent advises the Company of an offer to
purchase Notes denominated in a currency or currency unit other
than U.S. dollars, such Agent will provide the Company
information with respect to currency swap or forward arrangements
that, as of the time the offer is communicated to the Company, such
Agent is prepared to enter into or arrange with a third party to
enter into in order to exchange amounts to be received from the
purchaser of such Note at the Settlement Date and to exchange
amounts to be paid by the Company on the interest
payment dates and at maturity.
Settlement--
Sales as Principal: In the event of a purchase of Notes
by an Agent or Agents, as principal or underwriter (other than as
Purchasing Agent), appropriate settlement details will be set forth
in the applicable Terms Agreement to be entered into
between such Agent or Agents and the Company pursuant to the
Distribution Agreement.
Settlement--
Sales as Agent: All offers solicited by the Agents and
accepted by the Company will be settled on the third Business Day
(as defined below) after the date of acceptance unless
otherwise agreed by the purchaser and the Company and the
Settlement Date shall be specified upon acceptance of such
offer. The term "Business Day" means a Monday, Tuesday,
Wednesday, Thursday or Friday on which commercial banks in any of
New York City, the City of Chicago or the City of Wilmington and,
(i) if the Note is denominated in a currency other than U.S.
dollars, in the capital of the country of the Specified Currency,
or (ii) if the Note is denominated in European
Currency Units, in Brussels, are not required or authorized to be
closed.
Communication of Sale
Information to the
Company by Selling
Agent: For each offer accepted by the Company, the
Selling Agent or Purchasing Agent, as the case may be, will provide
(unless provided by the purchaser directly to the
Company) to a Designated Person by facsimile transmission or other
acceptable means the following information (the "Sale
Information"):
(1) If a Certificated Note, exact name of
the registered owner,
(2) If a Certificated Note, exact address of
the registered owner,
(3) If a Certificated Note, taxpayer
identification number of the registered
owner (if available),
(4) If a Book-Entry Note, the DTC
Participant Number of the institution
through which the customer will hold the
beneficial interest in the Global Note,
(5) Principal amount of the Note,
(6) Date of Note,
(7) If a Fixed Rate Note, the interest rate,
(8) Settlement Date,
(9) Maturity date,
(10) Currency or currency unit in which the
Note is to be denominated and, if other
than U.S. dollars, the applicable
Exchange Rate for such currency or
currency unit,
(11) Indexed Currency, the Base Rate and the
Exchange Rate Determination Date, if
applicable,
(12) Issue Price,
(13) Selling Agent's commission or Purchasing
Agent's discount, as the case may be (to
be paid upon settlement as a discount
from gross proceeds of sale except as
provided below under "Delivery of Notes
and Cash Payment"),
(14) Net proceeds to the Company,
(15) If a redeemable Note with a Redemption
Commencement Date, such of the following
as are applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of
par), and
(iii) Amount (% of par) that
the Redemption Price shall
decline (but not below par) on
each anniversary of the
Redemption Commencement Date,
(16) If a redeemable or repayable Note with a
Redemption Date or Redemption Dates,
such of the following as are
applicable:
(i) the Redemption Date or
Redemption Dates,
(ii) whether the Note is redeemable
or repayable at the option of
the Company or the Holder or
both,
(iii) the Redemption Price (%
of par) on each Redemption
Date,
(iv) the notice period during which
the option to redeem may be
exercised, and
(v) the method by which notice of
redemption is to be given,
(17) If a Floating Rate Note, such of the
following as are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread,
(iv) Spread Multiplier,
(v) Maximum Rate,
(vi) Minimum Rate,
(vii) Initial Interest
Determination Date,
(viii) Interest Reset Dates,
(ix) Calculation Dates,
(x) Interest Determination Dates,
and
(xi) Calculation Agent,
(18) Interest Payment Dates,
(19) Regular Record Dates,
(20) Denomination of certificates to be
delivered at settlement, and
(21) That the Note is a Certificated Note
(if applicable),
(22) To the extent known to the Agent, any
information not otherwise expressly set
forth in the Prospectus Supplement which
is required pursuant to Item 501(c)(7)
or 508 of Regulation S-K promulgated by
the Commission, including, but not
limited to, the initial public offering
price of the Notes, if other than 100%
of the principal amount, and
(23) If an Agent purchases Notes as a
principal, the extent, if any, to which
the items specified in Sections 8(c),
8(d) and 8(h) of the Distribution
Agreement are required to be furnished
as of the Time of Delivery.
In addition, the Selling Agent will use its
reasonable efforts to provide in writing the following
information to the Company and the Trustee:
(24) One of the following:
a. In the case of a foreign registered
owner (other than a Financial Institution
(as defined below)), an IRS Form W-8 that
has been duly and properly signed by the
registered owner.
b. In the case of a registered owner
which is a Financial Institution, a
statement from the Financial Institution
signed under penalties of perjury
stating that the Financial Institution
has received from the beneficial owner
an IRS Form W-8 that has been duly and
properly signed by the registered owner
together with a copy of such Form W-8.
c. In the case of a registered owner
who is a United States person, an IRS
Form W-9 that has been duly and properly
signed by the registered owner.
A "Financial Institution" is a
securities clearing organization, a
bank, or another financial institution
that holds customers' securities in the
ordinary course of its trade or business
which holds a Note for a beneficial
owner who is a foreign person.
After receiving the Sale Information the
Company will, after recording the Sale Information and any
necessary calculations, provide appropriate documentation to the
Trustee necessary for the preparation, authentication and
delivery of such Note.
Change in Interest
Rate, Maturity or
Currency Denomination: The Company and the Agents will discuss
from time to time the rates of interest per annum to be borne by,
and the maturity and currency denomination of, Notes that may be
sold as a result of the solicitation of offers by the Agents.
Suspension of Solicitation;
Amendment or Supplement:
The Company may instruct the Agents to suspend solicitation
of offers to purchase Notes at any time, whereupon the Agents will
as promptly as possible (but in any event not later than one
business day after receipt of such instruction) suspend
solicitation until such time as the Company has advised the Agents
that solicitation of offers to purchase Notes may be resumed. If
the Company proposes to amend or supplement the Registration
Statement or the Prospectus relating to the Notes (except in the
case of a Pricing Supplement), it will promptly advise the Agents
and will furnish to the Agents such proposed amendment or
supplement and, after the Agents have been afforded a reasonable
opportunity to review such amendment or supplement, will cause such
amendment or supplement to be filed with the Commission. The
Company will promptly provide the Agents with copies of any such
amendment or supplement and confirm to the Agents that such
amendment or supplement has been filed with the Commission.
In the event that at the time the Agents suspend
solicitation of offers to purchase Notes there shall be any
outstanding offers to purchase Notes that have been accepted by the
Company but for which settlement has not occurred, the Company,
consistent with its obligations under the Distribution Agreement,
promptly will advise the Agents whether such sales may be settled
and whether copies of the Prospectus as supplemented at the time of
the suspension may be delivered in connection with the settlement
of such sales. The Company will have the sole responsibility for
such decision and for any arrangements which may be made in the
event that the Company determines that such sales may not be
settled or that copies of such Prospectus may not be so delivered.
Authenticity of Signatures:
The Trustee will furnish the Agents from time to time with
the specimen signatures of each of the Trustee's officers,
employees or agents who have been authorized by the Trustee to
authenticate Notes, but the Agents will have no obligation or
liability to the Company or the Trustee in respect of the
authenticity of the signature of any officer, employee or agent of
the Company or the Trustee on any Note.
Advertising Cost:
The Company will determine with the Agents the amount of
advertising that may be appropriate in the solicitation of offers
to purchase the Notes. Advertising expenses will be paid by the
Company.
<PAGE>
II. Book-Entry Procedures
In connection with the qualification of Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee
will perform the custodial, document control and administrative
functions described below, in accordance with its obligations under
a Letter of Representations from the Company and the Trustee to
DTC, dated , 199 , and a Medium-Term Note Certificate
Agreement, dated , 19 between the Trustee and DTC
(the "Certificate Agreement"), and the Trustee's obligations as a
participant in DTC including DTC's Same-Day Funds Settlement System
("SDFS").
Issuance:
All Fixed Rate Notes which have the same original issue date,
redemption or repayment provisions, Interest Payment Dates, Regular
Record Dates, interest rate, Specified Currency and maturity date
(collectively, the "Fixed Rate Terms") will be represented
initially by a single Global Note in fully registered form without
coupons.
All Floating Rate Notes which have the same original issue
date, redemption or repayment provisions, Interest Payment
Dates, Regular Record Dates, Interest Rate Basis, Interest
Determination Dates, Interest Reset Dates, Calculation Dates, Index
Maturity, Spread or Spread Multiplier, if any, Minimum Rate, if
any, Maximum Rate, if any, Specified Currency and maturity date
(collectively, the "Floating Rate Terms") will be represented
initially be a single Global Note in fully registered form without
coupons.
Identification:
The Company has received from the CUSIP Service Bureau of
Standard & Poor's Corporation (the "CUSIP Service Bureau") a series
of approximately 900 CUSIP numbers for future assignment to Global
Notes, and the Company has delivered to the Trustee and DTC such
list of such CUSIP numbers. The Trustee will assign CUSIP numbers
to Global Notes as described below. DTC will notify the CUSIP
Service Bureau periodically of the CUSIP numbers that have been
assigned to Global Notes. The Trustee will notify the Company at
any time when fewer than 100 of the reserved CUSIP numbers remain
unassigned to Global Notes, and, if it deems necessary, the Company
will reserve additional CUSIP numbers for assignment to Global
Notes. Upon obtaining such additional CUSIP numbers, the Company
will deliver a list of such additional numbers to the Trustee and
DTC.
Registration:
Each Global Note will be registered in the name of Cede & Co.,
as nominee for DTC, on the Security Register maintained under the
Indenture. The beneficial owner of a Book-Entry Note (or one or
more indirect participants in DTC designated by such owner) will
designate one or more participants in DTC (the "Participants") to
act as agent or agents for such owner in connection with the book-
entry system maintained by DTC, and DTC will record in book-entry
form, in accordance with instructions provided by such
Participants, a credit balance with respect to such Book-Entry Note
in the account of such Participants. The ownership interest of
such beneficial owner in such Book-Entry Note will be recorded
through the records of such Participants or through the separate
records of such Participants and one or more indirect participants
in DTC.
Transfers:
Transfers of a Book-Entry Note will be accomplished by book
entries made by DTC and, in turn, by Participants (and in certain
cases, one or more indirect participants in DTC) acting on behalf
of beneficial transferors and transferees of such Book-Entry Note.
Exchanges:
The Trustee, at the Company's request, may deliver to DTC and
the CUSIP Service Bureau at any time a written notice of
consolidation specifying (a) the CUSIP numbers of two or more
outstanding Global Notes having the same Fixed Rate Terms or
Floating Rate Terms, as the case may be (except that original issue
dates need not be the same), and for which interest has been paid
to the same date; (b) a date, occurring at least 30 days after such
written notice is delivered and at least 30 days before the next
Interest Payment Date for the related Book-Entry Notes, on which
such Global Notes shall be exchanged for a single replacement
Global Note; and (c) a new CUSIP number to be assigned to such
replacement Global Note. Upon receipt of such a notice, DTC will
send to its participants (including the Trustee) a written
reorganization notice to the effect that such exchange will occur
on such date.
Prior to the specified exchange date, the Trustee will
deliver to the CUSIP Service Bureau written notice setting forth
such exchange date and the new CUSIP number and stating that, as of
such exchange date, the CUSIP numbers of the Global Notes to be
exchanged will no longer be valid.
On the specified exchange date, the Trustee will exchange
such Global Notes for a single Global Note bearing the new CUSIP
number. The CUSIP numbers of the exchanged Global Notes will, in
accordance with CUSIP Service Bureau procedures, be cancelled and
not immediately reassigned.
Notwithstanding the foregoing, if the Global Notes to be
exchanged exceed $200,000,000 in aggregate principal amount, one
replacement Global Note will be authenticated and issued to
represent each $200,000,000 of principal amount of the exchanged
Global Notes and an additional Global Note will be authenticated
and issued to represent any remaining principal amount of such
Global Notes, subject to the minimum denomination restrictions
described in General Procedures - Denominations (see
"Denominations" below).
Denominations:
Global Notes representing Book-Entry Notes will be denominated
in principal amounts not in excess of $200,000,000. If one or more
Book-Entry Notes having an aggregate principal amount in excess of
$200,000,000 would, but for the preceding sentence, be represented
by a single Global Note, then one Global Note will be issued to
represent each $200,000,000 principal amount of such Book-Entry
Note or Book-Entry Notes and an additional Global Note will be
issued to represent any remaining principal amount of such Book-
Entry Note or Book-Entry Notes, subject to the minimum denomination
restrictions described in General Procedures - Denominations. In
such a case, each of the Global Notes representing such
Book-Entry Note or Notes shall be assigned the same CUSIP number.
Interest:
DTC will arrange for each pending deposit message described
under Settlement Procedure B below to be transmitted to Standard &
Poor's Corporation, which will use the message to include certain
terms of the related Global Note in the appropriate daily bond
report published by Standard & Poor's Corporation.
Payments of Principal,
Premium, if any,
and Interest:
Payments of Interest Only. Promptly after each Regular
Record Date (or as soon thereafter as such information is
determined), the Trustee will deliver to the Company and DTC a
written notice specifying by CUSIP number the amount of
interest to be paid on each Global Note on the following
Interest Payment Date (other than an Interest Payment Date
coinciding with the Maturity) and the total of such amounts. DTC
will confirm the amount payable on each Global Note on such
Interest Payment Date by reference to the daily bond reports
published by Standard & Poor's Corporation. On such Interest
Payment Date, the Company will pay to the Trustee, and the
Trustee in turn will pay to DTC, such total amount of interest due
(other than at Maturity), at the times and in the manner set forth
below under "Manner of Payment."
Payments at Maturity. On or about the first Business Day
of each month (or as soon thereafter as such information is
determined), the Trustee will deliver to the Company and DTC a
written list of principal, premium, if any, and interest to be paid
on each Global Note maturing or subject to redemption or repayment
in the following month. The Trustee, the Company and DTC will
confirm the amounts of such principal, premium (if any) and
interest payments with respect to each such Global Note on or about
the fifth Business Day preceding the maturity date of such Global
Note. At such maturity date, the Company will pay to the Trustee,
and the Trustee in turn will pay to DTC, the principal of and
premium, if any, on such Global Note, together with interest due at
such maturity date, at the times and in the manner set forth below
under "Manner of Payment." Promptly after payment to DTC of the
principal, premium, if any, and interest due at maturity of all
Book-Entry Notes represented by a particular Global Note, the
Trustee will cancel such Global Note, make appropriate entries in
its records and dispose of such Global Note as provided in the
Indenture.
Manner of Payment. The total amount of any principal,
premium and interest due on Global Notes on any Interest Payment
Date or at maturity shall be paid by the Company to the Trustee in
funds immediately available for use by the Trustee as of noon, New
York City time, on such date. The Company will make such payment
on such Global Notes by wire transfer to the Trustee or by
instructing the Trustee to withdraw funds from an account
maintained by the Company at the Trustee. The Company will confirm
any such instructions in writing to the Trustee. For maturity,
redemption and other principal payments, prior to 1:00 p.m., New
York City time, on each such date or as soon as possible thereafter
following receipt of such funds from the Company, the Trustee will
pay by separate wire transfer (using Fedwire message entry
instructions in a form previously specified by DTC) to an account
at the Federal Reserve Bank of New York previously specified by
DTC, in funds available for immediate use by DTC, each payment of
interest, principal and premium, if any, due on Global Notes on
such date; and for interest payments, the Trustee will pay DTC in
same day funds on the Interest Payment Date in accordance with
existing arrangements between the Trustee and DTC. Thereafter on
each such date, DTC will pay, in accordance with its SDFS operating
procedures then in effect, such amounts in funds available for
immediate use to the respective Participants with payments in
amounts proportionate to their respective holdings in principal
amount of beneficial interest in such Global Note as are
recorded in the book-entry system maintained by DTC. Once
payment has been made to DTC, neither the Company nor the
Trustee shall have any responsibility or liability for the
payment by DTC of the principal of, or premium, if any, or
interest on, the Book-Entry Notes to such Participants.
Withholding Taxes. The amount of any taxes required under
applicable law to be withheld from any interest payment on a Book-
Entry Note will be determined and withheld by the Participant,
indirect participant in DTC or other Person responsible for
forwarding payments and materials directly to the beneficial owner
of such Book-Entry Note, or as applicable law may otherwise
require.
Settlement Procedures: Settlement Procedures with regard to each
Book-Entry Note sold by each Agent will be as follows:
A. Upon receiving the Sale Information, the Company
will, as soon as practicable, advise the Trustee by facsimile
transmission of the Sale Information and the name of such Agent.
B. The Trustee will assign a CUSIP number to the Global
Note representing such Book-Entry Note and will communicate to DTC
and the Agent through DTC's Participant Terminal System, a pending
deposit message specifying such of the following Settlement
information as applicable:
1. The following information:
(a) Principal amount of the purchase.
(b) In the case of a Fixed Rate Note, the
interest rate, or, in the case of a Floating Rate Note, the initial
interest rate, the Interest Reset Dates, the Interest Payment
Dates, the Interest Rate Basis, Index Maturity, Spread or Spread
Multiplier, if any, and the Minimum Rate and Maximum Rate, if any.
(c) Settlement date.
(d) Maturity date.
(e) Price.
(f) DTC Participant Number of the institution
through which the customer will hold the beneficial interest in the
Global Note.
2. The numbers of the participant accounts
maintained by DTC on behalf of the Trustee and the Agent.
3. Identification as a Fixed Rate Note or a
Floating Rate Note.
4. The initial Interest Payment Date for such
Note, number of days by which such date succeeds the related DTC
record date (which term means the Regular Record Date, or in the
case of Floating Rate Notes which reset weekly, the date five
calendar days immediately preceding the applicable Interest Payment
Date) and, for Fixed Rate Notes, the amount of interest payable on
such Interest Payment Date per $1,000 principal amount of Note.
5. The frequency of interest payments.
6. The frequency of interest rate resets.
7. The CUSIP number of the Global Note
representing such Book-Entry Notes.
8. Whether such Global Note represents any other
Book-Entry Notes issued or to be issued.
The Trustee will also orally notify the Agent of
the CUSIP number assigned to the Global Note.
C. The Trustee will prepare a Global Note representing
such Book-Entry Note in a form that has been approved by the
Company.
D. The Trustee will authenticate the Global Note
representing such Book-Entry Note and maintain possession of such
Global Note.
E. DTC will credit such Book-Entry Note to the
participant account of the Trustee maintained by DTC.
F. The Trustee will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i) debit such
Book-Entry Note to the Trustee's participant account and credit
such Book-Entry Note to the participant account of the Agent
maintained by DTC and (ii) debit the settlement account of the
Agent and credit the settlement account of the Trustee
maintained by DTC, in an amount equal to the price of such
Book-Entry Note less the Agent's commission. The entry of such a
deliver order shall be deemed to constitute a representation and
warranty by the Trustee to DTC that (a) the Global Note
representing such Book-Entry Note has been issued and
authenticated and (b) the Trustee is holding such Global Note
pursuant to the Certificate Agreement.
G. The Agent will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i) debit such
Book-Entry Note to the Agent's participant account and credit such
Book-Entry Note to the participant accounts of the Participants to
whom such Book-Entry Note is to be credited maintained by DTC and
(ii) debit the settlement accounts of such Participants and credit
the settlement account of the Agent maintained by DTC, in an amount
equal to the initial public offering price of the Book-Entry Note
so credited to their accounts.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures F and G will be settled
in accordance with SDFS operating procedures in effect on the
Settlement Date.
I. The Trustee will credit to an account of the Company
maintained at funds available for immediate use in an amount equal
to the amount credited to the Trustee's DTC settlement account in
accordance with Settlement Procedure F.
J. The Agent will confirm the purchase of each Book-
Entry Note to the purchaser thereof either by transmitting to the
Participant to whose account such Note has been credited a
confirmation order through DTC's Participant Terminal System or by
mailing a written confirmation to such purchaser. In all cases the
Prospectus as most recently amended or supplemented (including the
applicable Pricing Supplement) must accompany or precede such
confirmation.
Settlement Procedures
Timetable:
For offers accepted by the Company, Settlement Procedures A
through J shall occur no later than the respective times (New York
City time) listed below:
Settlement
Procedure Time
A 11:00 a.m. on the Business Day following the
date of acceptance.
B 2:00 p.m. on the Business Day following the
date of acceptance.
C 5:00 p.m. on the Business Day before the
Settlement Date.
D 9:00 a.m. on the Settlement Date.
E 10:00 a.m. on the Settlement Date.
F-G 2:00 p.m. on the Settlement Date.
H 4:45 p.m. on the Settlement Date.
I-J 5:00 p.m. on the Settlement Date.
Settlement Procedure H is subject to extension in accordance
with any extension of Fedwire closing deadlines and in the other
events specified in the SDFS operating procedures in effect on the
Settlement Date.
If Settlement of a Book-Entry Note is rescheduled or cancelled,
the Trustee will deliver to DTC, through DTC's Participant Terminal
System, a cancellation message to such effect by no later than 2:00
p.m., New York City time, on the Business Day immediately preceding
the scheduled Settlement Date.
Failures:
If the Trustee has not entered an SDFS deliver order with
respect to a Book-Entry Note pursuant to Settlement Procedure F
(which may be evidenced by facsimile transmission), the Trustee, at
the Company's direction, shall deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable, but no later
than 2:00 p.m. on any business day, a withdrawal message
instructing DTC to debit such Book-Entry Note to the participant
account of the Trustee maintained at DTC. DTC will process the
withdrawal message, provided that such participant account contains
a principal amount of the Global Note representing such Book-Entry
Note that is at least equal to the principal amount of such Book-
Entry Note to be debited. If withdrawal messages are processed
with respect to all the Book-Entry Notes issued or to be issued
represented by a Global Note, the Trustee will void such Global
Note, make appropriate entries in its records and, unless otherwise
directed by the Company, destroy the Certificate. The CUSIP number
assigned to such Global Note shall, in accordance with CUSIP
Service Bureau procedures, be cancelled and not immediately
reassigned. If withdrawal messages are processed with respect to
a portion of the Book-Entry Notes represented by a Global Note, the
Trustee will exchange such Global Note for two Global Notes, one of
which shall represent such Book-Entry Notes (which shall be
cancelled immediately after issuance), and the other of which shall
represent the remaining Book-Entry Notes previously represented by
the surrendered Global Note and shall bear the CUSIP number of the
surrendered Global Note. If the purchase price for any Book-Entry
Note is not timely paid to the Participants with respect to such
Note by the beneficial purchaser (other than a Purchasing Agent)
thereof (or a person, including an indirect participant in DTC,
acting on behalf of such purchaser), such Participants and, in
turn, the related Agent may enter SDFS deliver orders through DTC's
Participant Terminal System debiting such Note free to such Agent's
Participant Account and crediting such Note free to the
Participant Account of the Trustee and shall notify the Trustee and
the Company thereof. Thereafter, the Trustee, (i) will immediately
notify the Company, once the Trustee has confirmed that such Note
has been credited to its Participant Account, and the Company shall
transfer by Fedwire (immediately available funds) to such Agent an
amount equal to the price of such Note which was previously sent by
wire transfer to the account of the Company maintained at
in accordance with settlement procedure I, and (ii)
the Trustee will deliver the withdrawal message and take the
related actions described in the preceding sentences of this
paragraph. Such debits and credits will be made on the Settlement
Date, if possible, and in any event not later than 5:00 p.m. on the
following Business Day. If such failure shall have occurred for
any reason other than default by the Agent in the performance of
its obligations hereunder or under the Distribution Agreement, the
Company will reimburse the Agent on an equitable basis for its loss
of the use of funds during the period when they were credited to
the account of the Company. In addition, if such failure shall
have occurred by reason of a default by the Company in the
performance of its obligations under the Distribution Agreement,
the Company will pay the Selling Agent any commission to which it
would have been entitled in connection with such sale.
Notwithstanding the foregoing, upon any failure to settle
with respect to a Book-Entry Note, DTC may take any actions in
accordance with its SDFS operating procedures then in effect. In
the event of a failure to settle with respect to a Book-Entry Note
that was to have been represented by a Global Note also
representing other Book-Entry Notes, the Trustee will provide, in
accordance with Settlement Procedures C and D, for the
authentication and issuance of a Global Note representing such
other Book-Entry Notes and will make appropriate entries in its
records.
Trustee Not to Risk
Funds:
Nothing herein shall be deemed to require the Trustee to
risk or expend its own funds in connection with any payment to the
Company, or the Agents or DTC, it being understood by all parties
that payments made by the Trustee to either the Company, DTC or the
Agents shall be made only to the extent that funds are provided to
the Trustee for such purpose.
<PAGE>
III. Certificated Notes procedures
Payment at
Maturity:
As specified in the Indenture and the Form of Note.
Settlement:
Prior to 3:00 p.m., New York City time, on the Business Day
prior to the Settlement Date, the Company will instruct the Trustee
or its agent by facsimile transmission or other acceptable written
means to authenticate and deliver the Certificated Notes no later
than 2:15 p.m., New York City time, on the Settlement Date.
If the Settlement Date is the same day as the date of
acceptance, then prior to 11:00 a.m., New York City time, on the
Settlement Date the Company will instruct the Trustee or its agent
by facsimile transmission or other acceptable written means to
authenticate and deliver the Certificated Notes no later than 2:15
p.m., New York time, on the Settlement Date. Certificated Notes
denominated in a currency or currency unit other than U.S. dollars
shall have a Settlement Date not less than two Business Days after
the acceptance of the offer by the Company.
Delivery of
Notes
and Cash
Payment:
Upon receipt of appropriate documentation and instructions,
the Company will cause the Trustee to prepare and authenticate each
Note and appropriate receipts.
Each Certificated Note shall be authenticated and dated on
the Settlement Date therefor. The Trustee will deliver each
authenticated Certificated Note to the Selling Agent for the
benefit of the purchaser in accordance with written instructions
(or oral instructions confirmed in writing (which may be given by
telex or telecopy) on the next business day) from the Company.
Delivery by the Trustee of each Certificated Note will be made
against a receipt therefor.
Upon verification by the Selling Agent that a Certificated
Note has been prepared and properly authenticated and delivered by
the Trustee and registered in the name of the purchaser in the
proper principal amount and other terms in accordance with the Sale
Information, payment will be made to the Company's account at
on behalf of the Company by the Selling Agent
on behalf of the purchaser the same day as the Selling Agent's
receipt of such Certificated Note in immediately available funds.
If either (i) the Certificated Note is denominated in U.S. dollars
or (ii) the Certificated Note is denominated in a currency or
currency unit other than U.S. dollars and, at or prior to the
Settlement Date, the Company and the Selling Agent have entered
into, or the Selling Agent has arranged for the Company to enter
into, a contract with respect to the sale of the Specified
Currency, the amount payable by the Selling Agent pursuant to the
preceding sentence shall be the issue price of the Certificated
Note (or the U.S. dollar equivalent pursuant to such contract) less
the Selling Agent's commission determined in accordance with
Section 2(a) of the Distribution Agreement. In all other cases,
the Selling Agent's commission shall not be discounted from the
gross proceeds but shall be paid separately by the Company in U.S.
dollars in immediately available funds on the Settlement Date. The
payment by the Selling Agent shall be made only upon prior receipt
by such Agent of immediately available funds from or on behalf of
the purchaser in the Specified Currency unless such Agent decides,
at its option, to advance its own funds for such payment against
subsequent receipt of funds from the purchaser.
Upon delivery of a Certificated Note to the Selling Agent
and the verification provided in the preceding paragraph, the
Selling Agent shall promptly deliver such Certificated Note to the
purchaser or its agent.
Failures:
In the event that a purchaser (other than a Purchasing
Agent) shall fail to accept delivery of and make payment for any
Certificated Note, the Selling Agent will forthwith notify the
Trustee and the Company's by telephone or
by facsimile transmission. If the Certificated Note has been
delivered to the Selling Agent on behalf of the purchaser, the
Selling Agent will immediately return the Certificated Note to the
Trustee. If funds have been advanced by the Selling Agent for the
purchase of such Note, will, upon
instruction by the Company and upon receipt of the Certificated
Note, debit the account of the Company in an amount equal to the
amount previously credited thereto in respect of the Note and will
either credit the account of or return such funds to the Selling
Agent. Such debits and credits or returns will be made on the
Settlement Date if possible and, in any event, not later than the
business day following the Settlement Date. If such failure shall
have occurred for any reason other than default by the Selling
Agent in the performance of its obligations under the Distribution
Agreement, the Company will reimburse the Selling Agent on an
equitable basis for its loss of the use of the funds during the
period when they were credited to the account of the Company. In
addition, if such failure shall have occurred by reason of a
default by the Company in the performance of its obligations under
the Distribution Agreement, the Company will pay the Selling Agent
any commission to which it would have been entitled in connection
with such sale.
Immediately upon receipt of the certificate representing the
Note in respect of which the failure occurred, the Trustee will
void such Certificated Note, make appropriate entries in its
records and, unless otherwise instructed by the Company, destroy
the certificate.
<PAGE>
ANNEX III
Pursuant to Section 8(d) of the Distribution Agreement, the
Company's and Sears independent certified public accountants shall
furnish letters to the effect that:
(i) They are independent certified public accountants
with respect to the Company and Sears and its consolidated
subsidiaries within the meaning of the Act and the applicable
published rules and regulations of the Commission thereunder and
the answer to Item 10 of the Registration Statement is correct
insofar as it relates to them;
(ii) In their opinion, the financial statements and
schedules and the additional financial information examined by them
and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Act or
the Exchange Act, as applicable, and the published rules and
regulations thereunder;
(iii) On the basis of limited procedures, not
constituting an examination in accordance with generally accepted
auditing standards, including a reading of the unaudited financial
statements and schedules and other information referred to below,
a reading of the latest available interim financial statements of
the Company and Sears and certain of its subsidiaries, inspection
of the minute books of the Company and Sears and certain of its
subsidiaries since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus,
inquiries of officials of the Company and Sears and its
subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe
that:
(A) the unaudited consolidated statements of income,
consolidated statements of financial position and consolidated
statements of changes in financial position of the Company and of
Sears and its consolidated subsidiaries included or incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of
the Exchange Act and the published rules and regulations
thereunder; or
(B) as of a specified date not more than five business
days prior to the date of delivery of such letter, there have been
any changes in the capital stock accounts, long-term debt, short-
term debt, or any decreases in net assets or other items specified
by the Agents, in each case as compared with amounts shown or
included in the latest statement of financial position of the
Company included or incorporated by reference in the Prospectus,
except in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are
described in such letter; and
(iv) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus
and the limited procedures, inspection of minute books, inquiries
and other procedures referred to in clause (iii) above, they have
carried out certain specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information specified by the Agents which are derived from the
general accounting records of the Company and Sears and its
subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Agents or
in documents incorporated by reference in the Prospectus specified
by the Agents, and have compared certain of such amounts,
percentages and financial information with the accounting records
of the Company and Sears and its subsidiaries and have found them
to be in agreement.
All references in this Annex III to the Prospectus shall
be deemed to refer to the Prospectus as amended or supplemented
(including the documents incorporated by reference therein) as of
the Closing Date referred to in Section 8(d) thereof and to the
Prospectus as amended or supplemented (including the documents
incorporated by reference therein) as of the date of the amendment,
supplement, incorporation or the Time of Delivery relating to the
Terms Agreement requiring the delivery of such letter under Section
8(d) thereof.
Exhibit 4(d)
SEARS ROEBUCK AND CO.
3333 BEVERLY ROAD
HOFFMAN ESTATES, ILLINOIS 60179
[Date]
Sears Roebuck and Co.
3711 Kennett Pike
Greenville, Delaware 19807
Gentlemen:
This is to confirm our agreement ("Extension Agreement") that the term "Debt
Securities" as defined in the Fixed Charge Coverage and Ownership Agreement
dated as of May 15, 1995 between Sears Roebuck Acceptance Corp. ("SRAC"), and
Sears, Roebuck and Co. shall be expanded to include up to $4 billion aggregate
initial offering price of debt securities to be issued by SRAC under
Registration Statement No. 33-[ ].
If the foregoing satisfactorily sets forth your understanding of our agreement,
please indicate your acceptance by the signature of a duly authorized officer
in the space provided below and on the duplicate original of this letter which
is enclosed.
Very truly yours,
SEARS, ROEBUCK AND CO.
By:
Accepted:
SEARS ROEBUCK ACCEPTANCE CORP.
By:
Exhibit 5
August 8, 1996
Sears Roebuck Acceptance Corp.
3711 Kennett Pike
Greenville, Delaware 19807
Sears, Roebuck and Co.
3333 Beverly Road
Hoffman Estates, Illinois 60179
Ladies and Gentlemen:
I have examined the Registration Statement on Form S-3, to be filed with
the Securities and Exchange Commission on or about August 8,1996 (the
"Registration Statement") by Sears Roebuck Acceptance Corp. (the "Company")
and Sears, Roebuck and Co. in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of $4,000,000,000 principal
amount of debt securities (the "Debt Securities") for an offering to be made on
a continuous or delayed basis pursuant to the provisions of Rule 415 under the
Act. I have examined the indenture dated as of May 15, 1995 between the Company
and The Chase Manhattan Bank, N.A., which will be incorporated by reference into
the Registration Statement, under which the Debt Securities are to be issued.
I am familiar with the proceedings heretofore taken, and with the additional
proceedings proposed to be taken, by the Company in connection with the
authorization, registration, issuance and sale of the Debt Securities.
Subject to the proposed additional proceedings being taken as now
contemplated prior to the issuance of the Debt Securities and the terms of the
Debt Securities being otherwise in compliance with then applicable law, I am of
the opinion that the Debt Securities will, upon the issuance and sale thereof in
the manner referred to in the Registration Statement, be legally issued and
binding obligations of the Company in accordance with their terms, subject to
insolvency, bankruptcy, reorganization or other laws relating to or affecting
the enforcement of creditors' rights or by general equity principles.
I consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to me in the Prospectus which is part of the
Registration Statement.
Sincerely,
/S/ Venrice R. Palmer
Senior Counsel
EXHIBIT 15(a)
Sears Roebuck Acceptance Corp.
Greenville, Delaware
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of Sears Roebuck Acceptance Corp. for the periods ended March 30,
1996 and March 31, 1995. As indicated in our report dated April 11, 1996,
because we did not perform an audit, we expressed no opinion on that
information. We are aware that our report referred to above, which is included
in your Quarterly Report on Form 10-Q for the quarter ended March 30, 1996, is
incorporated by reference in this Registration Statement on Form S-3. We are
also aware that the aforementioned report, pursuant to Rule 436(c) under the
Securities Act, is not considered a part of the Registration Statement prepared
or certified by an accountant or a report prepared or certified by an accountant
within the meaning of Sections 7 and 11 of that Act.
/S/DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
August 8, 1996
Exhibit 15(b)
August 8, 1996
Sears, Roebuck and Co.
3333 Beverly Road
Hoffman Estates, Illinois
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of Sears, Roebuck and Co. for the periods ended March 30, 1996 and
April 1, 1995, as indicated in our report dated May 9, 1996; because we did not
perform an audit, we expressed no opinion on that information.
We are aware that our report referred to above, which was included in your
Quarterly Report on Form 10-Q for the quarter ended March 30, 1996, is being
used in this Registration Statement.
We are also aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant within the meaning of Sections
7 and 11 of that Act.
/S/Deloitte & Touche LLP
Chicago, Illinois
EXHIBIT 23(a)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS We consent to the
incorporation by reference in this Registration Statement of Sears Roebuck
Acceptance Corp. (the "Company") on Form S-3 of our report dated January 19,
1996, appearing in (and incorporated by reference in) the Annual Report on Form
10-K of Sears Roebuck Acceptance Corp. for the year ended December 30, 1995,
and to the reference to us under the heading "Experts" in the Prospectus, which
is part of this Registration Statement. We also consent to the use in this
Registration Statement of our report dated January 19, 1996 on the Company's
Summary Financial Information under the captions "Operating Results" and
"Financial Position" included as Exhibit 99 to this Registration Statement.
/S/DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
August 8, 1996
Exhibit 23(b)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Sears, Roebuck and Co. on Form S-3 of our reports dated February 15, 1996,
appearing in, and incorporated by reference in, the Annual Report on Form 10-K
of Sears, Roebuck and Co. for the year ended December 30, 1995 and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/S/Deloitte & Touche LLP
Chicago, Illinois
August 8, 1996
Exhibit 24(a)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned, being a
director or officer, or both, of SEARS ROEBUCK ACCEPTANCE CORP., a Delaware
corporation (the "Corporation"), does hereby constitute and appoint STEPHEN D.
CARP, KEITH E. TROST, GEORGE F. SLOOK, NANCY M. HOUGHTON-LYNCH and RICHARD F.
KOTZ, with full power to each of them to act alone, as the true and lawful
attorneys and agents of the undersigned, with full power of substitution and
resubstitution to each of said attorneys, to execute, file or deliver any and
all instruments and to do any and all acts and things which said attorneys and
agents, or any of them, deem advisable to enable the Corporation to comply with
the Securities Act of 1933, as amended, and the Trust Indenture Act of 1939, as
amended, and any requirements or regulations of the Securities and Exchange
Commission in respect thereto, in connection with the registration under said
Securities Act of debt securities to be issued by the Corporation under the
provisions of an appropriate indenture and the qualification of said indenture
under said Trust Indenture Act, including specifically, but without
limitation of the general authority hereby granted, the power and authority to
sign his or her name in the name and on behalf of the Corporation or as a
director or officer, or both, of the Corporation, as indicated below opposite
his or her signature, to the registration statement, or any amendment,
post-effective amendment or papers supplemental thereto, to be filed in respect
of said debt securities; and each of the undersigned does hereby ratify and
confirm all that said attorneys and agents, or any of them, or the substitute
of any of them, shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed these
presents, as of this 8th day of August, 1996.
NAME TITLE
/S/Keith E. Trost Director and President
Keith E. Trost (Principal Executive Officer)
/S/ George F. Slook Director and Vice President
George F. Slook and Assistant Secretary
/S/ Stephen D. Carp Vice President, Finance
Stephen D. Carp and Assistant Secretary
(Principal Financial
and Accounting Officer)
/S/ James A. Blanda Director
James A. Blanda
/S/ James D. Constantine Director
James D. Constantine
/S/ Alan J. Lacy Director
Alan J. Lacy
/S/ Alice M. Peterson Director
Alice M. Peterson
/S/ Larry R. Raymond Director
Larry R. Raymond
Exhibit 24b
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned being a
director or officer, or both, of SEARS, ROEBUCK AND CO., a New York corporation
(the "Company"), does hereby constitute and appoint ARTHUR C. MARTINEZ, ALAN J.
LACY, MICHAEL D. LEVIN, JAMES A. BLANDA and ALICE M. PETERSON, with full power
to each of them to act alone, as the true and lawful attorneys and agents of
the undersigned, with full power of substitution and resubstitution to each of
said attorneys, to execute, file or deliver any and all instruments and to do
any and all acts and things which said attorneys and agents, or any of them,
deem advisable to enable the Company to comply with the Securities Act of 1933,
as amended (the "Securities Act"), the Trust Indenture Act of 1939, as amended,
and any requirements or regulations of the Securities and Exchange Commission
in respect thereto, in connection with there registration under said Securities
Act of issues of debt securities, guarantees, certificates of interest in
trusts, common or preferred shares of the Company (including without limitation
common or preferred shares of the Company into which any of such securities are
convertible), interests in such preferred shares, other securities, or warrants
or rights to purchase or receive any of the foregoing, to be issued or sold by
the Company (or by subsidiaries of the Company where the Company signs, as
co-registrant, registration statements filed by such subsidiaries under said
Securities Act), where applicable under the provisions of appropriate
indentures, and the qualification of said indentures under said Trust Indenture
Act, including specifically, but without limitation of the general authority
hereby granted, the power and authority to sign his or her name as director or
officer, or both, of the Company, as indicated below opposite his or her
signature, to the registration statements, or any amendments, post-effective
amendments, supplements or papers supplemental thereto, to be filed in respect
of said debt securities, guarantees, certificates of interest, common shares,
preferred shares or interests therein, other securities, or warrants or rights,
and each of the undersigned does hereby fully ratify and confirm all that said
attorneys and agents or any of them, or the substitute of any of them,
shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed his or her
name, this 8th day of August, 1996.
NAME TITLE
/S/ Arthur C. Martinez
ARTHUR C. MARTINEZ Director, Chairman of
the Board of Directors,
President and Chief Executive
Officer (Principal Executive
Officer)
/S/ Alan J. Lacy
ALAN J. LACY Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
/S/ James A. Blanda
JAMES A. BLANDA Vice President and Controller
(Principal Accounting
Officer)
/S/ Hall Adams, Jr.
HALL ADAMS, JR. Director
/S/ Warren L. Batts
WARREN L. BATTS Director
/S/ James W. Cozad
JAMES W. COZAD Director
/S/Michael A. Miles
MICHAEL A. MILES Director
/S/ Nancy C. Reynolds
NANCY C. REYNOLDS Director
/S/ Clarence B. Rogers, Jr.
CLARENCE B. ROGERS, JR. Director
/S/ Donald H. Rumsfeld
DONALD H. RUMSFELD Director
/S/ Dorothy A. Terrell
DOROTHY A. TERRELL Director
EXHIBIT 25
Securities Act of 1933 File No. _________
(If application to determine eligibility of trustee
for delayed offering pursuant to Section 305 (b) (2))
___________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2)___________
__________________
THE CHASE MANHATTAN BANK
(National Association)
(Exact name of trustee as specified in its charter)
13-2633612
(I.R.S. Employer Identification Number)
1 Chase Manhattan Plaza, New York, New York
(Address of principal executive offices)
10081
(Zip Code)
________________
SEARS ROEBUCK ACCEPTANCE CORP.
(Exact name of obligor as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
51-0080535
(I.R.S. Employer Identification No.)
3711 Kennett Pike
Greenville, Delaware
(Address of principal executive offices)
19807
(Zip Code)
__________________________________
Debt Securities
(Title of the indenture securities)
_____________________________________________________________________
<PAGE>
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of The Federal Reserve System,
Washington, D. C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
The Trustee is not the obligor, nor is the Trustee directly or
indirectly controlling, controlled by, or under common control with the
obligor.
(See Note on Page 2.)
Item 16. List of Exhibits.
List below all exhibits filed as a part of this statement of
eligibility.
*1. -- A copy of the articles of association of the trustee as now in
effect. (See Exhibit T-1 (Item 12) , Registration No. 33-55626.)
*2. -- Copies of the respective authorizations of The Chase Manhattan
Bank (National Association) and The Chase Bank of New York (National
Association) to commence business and a copy of approval of merger of said
corporations, all of which documents are still in effect. (See Exhibit T-1
(Item 12), Registration No. 2-67437.)
*3. -- Copies of authorizations of The Chase Manhattan Bank (National
Association) to exercise corporate trust powers, both of which documents are
still in effect. (See Exhibit T-1 (Item 12), Registration No. 2-67437).
*4. -- A copy of the existing by-laws of the trustee.
(See Exhibit T-1 (Item 12(a)), Registration No. 33-28806.)
*5. -- A copy of each indenture referred to in Item 4, if the obligor
is in default. (Not applicable).
*6. -- The consents of United States institutional trustees required by
Section 321(b) of the Act. (See Exhibit T-1, (Item 12), Registration
No. 22-19019.)
7. -- A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its supervising or examining
authority.
___________________
*The Exhibits thus designated are incorporated herein by reference.
Following the description of such Exhibits is a reference to the copy of the
Exhibit heretofore filed with the Securities and Exchange Commission, to which
there have been no amendments or changes.
___________________
1.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the
trustee of all facts on which to base a responsive answer to Item 2 the answer
to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, The Chase Manhattan Bank (National Association), a corporation
organized and existing under the laws of the United States of America, has duly
caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized , all in the City of New York, and the
State of New York, on the 5th day April, 1995.
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By /s/ Edward C. Morelli
Edward C. Morelli
Second Vice President
_________________
2.Exhibit 7
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the
The Chase Manhattan Bank, N.A.
of New York in the State of New York, at the close of business on December 31,
1994, published in response to call made by Comptroller of the Currency, under
title 12, United States Code, Section 161.
Charter Number 2370 Comptroller of the Currency Northeastern District
Statement of Resources and Liabilities
ASSETS
Thousands
of Dollars
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin $ 4,517,179
Interest-bearing balances 7,001,642
Held to maturity securities 1,593,325
Available-for-sale securities 4,669,255
Federal funds sold and securities purchased under
agreements to resell in domestic offices of the bank
and of its Edge and Agreement subsidiaries, and in
IBFs:
Federal funds sold 3,651,850
Securities purchased under agreements to resell 0
Loans and lease financing receivable:
Loans and leases, net of unearned income $ 50,879,818
LESS: Allowance for loan and lease losses 1,073,196
LESS: Allocated transfer risk reserve 0
Loans and leases, net of unearned income, allowance,
and reserve 49,806,622
Assets held in trading accounts 13,112,807
Premises and fixed assets (including capitalized leases) 1,758,500
Other real estate owned 480,982
Investments in unconsolidated subsidiaries and
associated companies 55,722
Customers' liability to this bank on acceptances
outstanding 611,839
Intangible assets 787,948
Other assets 6,145,452
TOTAL ASSETS $94,193.123
LIABILITIES
Deposits:
In domestic offices $29,536,028
Noninterest-bearing $ 11,648,377
Interest-bearing 17,887,651
In foreign offices, Edge and Agreement subsidiaries,
and IBFs 36,020,612
Noninterest-bearing $ 2,320,293
Interest-bearing 33,700,319
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of
the bank and of its Edge and Agreement subsidiaries,
and in IBFs:
Federal funds purchased 1,014,936
Securities sold under agreements to repurchase 678,033
Demand notes issued to the U.S. Treasury 300,000
Trading liabilities 8,066,477
Other borrowed money:
With original maturity of one year or less 2,940,252
With original maturity of more than one year 427,525
Mortgage indebtedness and obligations under
capitalized leases 40,550
Bank's liability on acceptances executed and
outstanding 616,531
Subordinated notes and debentures 2,360,000
Other liabilities 5,195,890
TOTAL LIABILITIES 87,196,834
Limited-life preferred stock and related surplus 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock 915,576
Surplus 4,656,010
Undivided profits and capital reserves 1,478,713
Net unrealized holding gains (losses) on
available-for-sale securities (64,959)
Cumulative foreign currency translation adjustments 10,949
TOTAL EQUITY CAPITAL 6,996,289
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED STOCK,
AND EQUITY CAPITAL $94,193,123
I, Lester J. Stephens, Jr., Senior Vice President and Controller of the above
named bank do hereby declare that this Report of Condition is true and correct
to the best of my knowledge and belief.
(Signed) Lester J. Stephens, Jr.
We the undersigned directors, attest to the correctness of this statement of
resources and liabilities. We declare that it has been examined by us, and to
the best of our knowledge and belief has been prepared in conformance with the
instructions and is true and correct.
(Signed) Thomas G. Labrecque
(Signed) Richard J. Boyle Directors
(Signed) Donald H. Trautlein
EXHIBIT 99
INDEPENDENT AUDITORS' REPORT
To the Stockholder and Board of Directors
of Sears Roebuck Acceptance Corp.:
We have audited the statement of financial position of Sears Roebuck Acceptance
Corp. (a wholly owned subsidiary of Sears, Roebuck and Co.) as of December 30,
1995 and December 31, 1994, and the related statements of income, stockholder's
equity, and cash flows for each of the three years in the period ended December
30, 1995, and have issued our report thereon dated January 19, 1996. Such
financial statements and our report thereon are incorporated by reference in
the Company's Annual Report on Form 10-K for the year ended December 30, 1995
and in this Prospectus. We have also previously audited, in accordance with
generally accepted auditing standards, the statements of financial position as
of December 31, 1993, 1992 and 1991, and the related statements of income,
stockholder's equity, and cash flows for the years ended December 31, 1992 and
1991 (none of which are presented herein); and we expressed unqualified
opinions on those financial statements. In our opinion, the information
set forth in the Summary Financial Information under the captions "Operating
Results" and "Financial Position" for each of the five years in the period
ended December 30, 1995, appearing on page 5, of this Prospectus, is fairly
stated, in all material respects in relation to the financial statements from
which it has been derived.
/S/DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
January 19, 1996
