As filed with the Securities and Exchange Commission on March 3, 1999
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________________
KOHL'S CORPORATION
(Exact name of Registrant as specified in its charter)
N56 W17000 Ridgewood Drive
Menomonee Falls, Wisconsin 53051
(414) 703-7000
(Name, address, including zip code
and telephone number, including area code,
of Registrant's principal executive officers)
----------------------
William S. Kellogg
R. Lawrence Montgomery
Kohl's Corporation
N56 W17000 Ridgewood Drive
Menomonee Falls, Wisconsin 53051
(414) 703-7000
(Name, address, including zip code, and telephone
number, including area code,
of agents, for service)
COPIES TO:
Peter M. Sommerhauser Andrew R. Schleider
Godfrey & Kahn, S.C. Shearman & Sterling
780 North Water Street 599 Lexington Avenue
Milwaukee, Wisconsin 53202 New York, New York 10022
(414) 273-3500 (212) 848-4000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO
THE PUBLIC: As soon as practicable after this
Registration Statement is declared effective.
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, check the
following box. [ ]
If this Form is filed to register additional
securities for an offering pursuant to Rule 462(b)
under the Securities Act, 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. [ ]
CALCULATION OF REGISTRATION FEE
TITLE OF EACH PROPOSED PROPOSED AMOUNT OF
CLASS OF AMOUNT TO BE MAXIMUM MAXIMUM REGISTRATION
SECURITIES TO BE REGISTERED OFFERING AGGREGATE FEE
REGISTERED (1) PRICE OFFERING
PER UNIT (2) PRICE (2)
Common Stock, 4,903,600 $66 29/32 $328,081,488 $91,207
$.01 par value shares
(1) Includes 639,600 shares that the
underwriters have the option to purchase to
cover over-allotments, if any.
(2) Estimated solely for the purpose of
calculating the registration fee pursuant to
Rule 457(c) on the basis of the average of the
high and low prices of the common stock on the
New York Stock Exchange on February 25, 1999.
The Registrant hereby amends this Registration
Statement on such date or dates as may be necessary to
delay its effective date until the Registrant shall
file a further amendment which specifically states that
this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may
determine.
<PAGE>
EXPLANATORY NOTE
This registration statement contains two forms of
prospectus: one to be used in connection with an
offering in the United States and Canada and one to be
used in a concurrent offering outside the United States
and Canada. The prospectuses are identical in all
material respects except for the front cover page. The
U.S. prospectus is included in this registration
statement and is followed by the alternate front cover
page to be used in the international prospectus. The
alternate page for the international prospectus
included in this registration statement is labeled
"Alternate Page for International Prospectus." Final
forms of each prospectus will be filed with the
Securities and Exchange Commission under Rule 424(b).
<PAGE>
INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGIS-
TRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING OFFERS
TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR
SALE IS NOT PERMITTED.
PROSPECTUS (Subject to Completion)
Issued March 3, 1999
4,264,000 Shares
KOHL'S
Common Stock
Kohl's Corporation is offering 2,800,000 shares and the
selling stockholders are offering 1,464,000 shares.
Initially, the U.S. underwriters are offering 3,411,200
shares in the United States and Canada, and the inter-
national underwriters are offering 852,800 shares outside
the United States and Canada.
Kohl's Corporation's common stock is listed on the New
York Stock Exchange under the symbol "KSS." On
March 2, 1999, the reported last sale price of the
common stock on the New York Stock Exchange was
$68 9/16 per share.
PRICE $ A SHARE
Underwriting Proceeds
Price to Discounts Proceeds to to
Public and Company Selling
Commissions Stockholders
Per Share $ $ $ $
Total $ $ $ $
The Securities and Exchange Commission and state
securities regulators have not approved or
disapproved these securities, or determined if this
prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
Kohl's Corporation has granted the U.S. underwriters
the right to purchase up to an additional 639,600
shares of common stock to cover over-allotments.
Morgan Stanley & Co. Incorporated expects to deliver
the shares to purchasers on ________________, 1999.
MORGAN STANLEY DEAN WITTER
MERRILL LYNCH & CO.
WILLIAM BLAIR & COMPANY
ROBERT W. BAIRD & CO.
Incorporated
________________, 1999
<PAGE>
ABOUT THIS PROSPECTUS
You should rely only on the information contained
in or incorporated by reference in this prospectus. We
and the selling stockholders have not authorized anyone
else to provide you with different information. We and
the selling stockholders are not making an offer of the
common stock in any state where the offer or sale is
not permitted. The information in this prospectus is
accurate only as of any date of this prospectus.
In this prospectus, the terms "Kohl's", "we" and
"our" mean Kohl's Corporation and its consolidated
subsidiaries.
TABLE OF CONTENTS
Page
Kohl's 3
Selected Consolidated Financial Data 4
Use of Proceeds 6
Price Range of Common Stock and Dividend Policy 6
Capitalization 7
Description of Capital Stock 8
Selling Stockholders 10
United States Federal Income Tax Considerations To
Non-United States Holders 12
Underwriters 14
Legal Matters 17
Experts 17
Forward-Looking Statements 17
Where You Can Find More Information 18
--------------------------
"Kohl's" is one of our federally registered
service marks. This prospectus also includes or
incorporates references to trademarks and brand names
of other companies.
<PAGE>
KOHL'S
We currently operate 213 family oriented,
specialty department stores primarily in the Midwest
and Mid-Atlantic areas of the United States. Our
stores feature quality, national brand merchandise
which provides exceptional value to customers. We sell
moderately priced apparel, shoes, accessories, soft
home products and housewares targeted to middle-income
customers shopping for their families and homes. Our
stores have fewer departments than traditional, full-
line department stores, but offer customers dominant
assortments of merchandise displayed in complete
selections of styles, colors and sizes. Central to our
pricing strategy and overall profitability is a culture
focused on maintaining a low cost structure. Critical
elements of this low cost structure are our unique
store format, lean staffing levels, sophisticated
management information systems and operating
efficiencies resulting from centralized buying,
advertising and distribution.
Since 1986, we have expanded from 40 stores to our
current total of 213 stores both by acquiring and
converting pre-existing stores to our retailing format
and by opening new stores. From fiscal 1993 to fiscal
1997, our net sales increased from $1.3 billion to $3.1
billion and our operating income increased from $102.4
million to $258.8 million. In fiscal 1998, our net
sales increased to $3.7 billion.
We believe that we have substantial opportunity
for further growth. We plan to open approximately 40
to 45 stores in 1999, including entering new markets in
Denver, St. Louis and Dallas/Ft. Worth. We plan to
open 50 to 55 stores in 2000, including 33 locations
previously operated by Caldor Corporation in New York
(12 stores), New Jersey (11 stores), Connecticut (9
stores) and Maryland (1 store). Our expansion strategy
is to open additional stores in existing markets, where
we can leverage advertising, purchasing, transportation
and other regional overhead expenses; in contiguous
markets, where we can extend regional operating
efficiencies; and in new markets which offer a similar
opportunity to implement our retailing concept
successfully.
Our retailing concept has proven to be readily
transferable to new markets. For example, we have
successfully opened new stores in small markets, such
as Kalamazoo and Knoxville; intermediate markets, such
as Kansas City and Charlotte; and large markets, such
as Chicago and Philadelphia. In addition, our concept
has been successful in various retailing formats such
as strip shopping centers, community and regional malls
and free-standing stores. We believe that the
transferability of our retailing strategy, our
experience in acquiring and converting pre-existing
stores and in opening new stores, and our substantial
investment in our management information systems,
centralized distribution and headquarters functions
provide a solid foundation for further expansion.
Our fiscal year ends on the Saturday closest to
January 31. Our principal executive offices are
located at N56 W17000 Ridgewood Drive, Menomonee Falls,
Wisconsin 53051. Our telephone number at this
location is (414) 703-7000.
Recent Developments
Net sales and sales growth for the thirteen weeks
and years ended January 31, 1998 and January 30, 1999
were as follows:
Percentage Increase at
Period Ended January 30, 1999
January January All Comparable
31, 1998 30, 1999 Stores Stores
(in millions)
Thirteen $1,077.8 $1,289.5 19.6% 6.4%
weeks
Year 3,060.1 3,681.8 20.3 7.9
Comparable stores sales growth represents sales of
those stores open throughout the full period and
throughout the full prior period.
At January 30, 1999, we operated 213 stores
compared to 182 stores at January 31, 1998.
On March 2, 1999, we purchased the right to occupy
32 store locations previously operated by Caldor
Corporation. We expect to purchase Caldor's lease for
a 33rd store location within thirty days. We plan to
take possession of the stores after Caldor completes
its "going out of business sale," and we expect that
the stores will be open for business in spring 2000.
We paid $142 million for the rights to occupy the
stores and expect to invest approximately $165 million
more to renovate and refixture the stores.
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
We derived the selected consolidated financial
data in the following table for each of the five years
in the period ended January 31, 1998 from our
consolidated financial statements, which have been
audited by Ernst & Young LLP, independent auditors.
You should read this information in conjunction with
our consolidated financial statements and related
notes, management's discussion and analysis of
financial condition and results of operations and other
financial information incorporated into this
prospectus. We derived the selected consolidated
financial data for the nine months ended November 1,
1997 and October 31, 1998 from our unaudited
consolidated financial statements, which, in the
opinion of management, include all adjustments,
consisting of normal recurring accruals, necessary for
a fair presentation of the financial position and
results of operations as of the dates and for the
periods presented. The results for the nine months
ended October 31, 1998 are not necessarily indicative
of results to be expected for the full fiscal year.
Our fiscal year ends on the Saturday closest to
January 31. Fiscal 1995 contained 53 weeks. We
adjusted all per share data to reflect the 2-for-1
stock splits effected in April 1996 and April 1998.
Fiscal Year Ended
January January February
29, 1994 28, 1995 3, 1996
(In Thousands, Except Per Share
and Per Square Foot Data)
Statement of Operations Data:
Net sales $1,305,746 $1,554,100 $1,925,669
Cost of merchandise sold 869,236 1,037,740 1,294,653
Gross margin 436,510 516,360 631,016
Selling, general and
administrative expenses 305,547 356,893 436,442
Depreciation and
amortization 23,201 27,402 33,931
Preopening expenses 5,360 8,190 10,712
Credit operations, non-
recurring(a) - - 14,052
Operating income 102,402 123,875 135,879
Interest expense, net 5,711 6,424 13,150
Income before income taxes
and extraordinary item 96,691 117,451 122,729
Income taxes 41,029 48,939 50,077
Income before
extraordinary item 55,662 68,512 72,652
Extraordinary item(b) (1,769) - -
Net income $ 53,893 $ 68,512 $ 72,652
Per share:
Basic $ .37 $ .47 $ .49
Diluted .36 .46 .49
Operating Data:
Comparable store sales
growth(c) 8.3% 6.1% 5.9%
Net sales per selling
square foot(d) $ 255 $ 258 $ 257
Total square feet of
selling space (in
thousands; end of period) 5,523 6,824 8,378
Number of stores open (end
of period) 90 108 128
Capital expenditures
including capitalized
leases $ 64,813 $ 132,800 $ 138,797
Balance Sheet Data (end of
period):
Working capital $ 86,856 $ 114,637 $ 175,368
Property and equipment, net 186,626 298,737 409,168
Total assets 469,289 658,717 805,385
Total long-term debt 51,852 108,777 187,699
Shareholders' equity 262,502 334,249 410,638
Fiscal Year Ended
February January
1, 1997 31, 1998
(In Thousands, Except Per
Share and Per Square Foot
Data)
Statement of Operations Data:
Net sales $2,388,221 $3,060,065
Cost of merchandise sold 1,608,688 2,046,468
Gross margin 779,533 1,013,597
Selling, general and
administrative expenses 536,226 678,793
Depreciation and
amortization 44,015 57,380
Preopening expenses 10,302 18,589
Credit operations, non-
recurring(a) _ _
Operating income 188,990 258,835
Interest expense, net 17,622 23,772
Income before income taxes
and extraordinary item 171,368 235,063
Income taxes 68,890 93,790
Income before
extraordinary item 102,478 141,273
Extraordinary item(b) - -
Net income $ 102,478 $ 141,273
Per share:
Basic $ .69 $ .93
Diluted .68 .91
Operating Data:
Comparable store sales
growth(c) 11.3% 10.0%
Net sales per selling
square foot(d) $ 261 $ 267
Total square feet of
selling space (in
thousands; end of
period) 10,064 12,533
Number of stores open
(end of period) 150 182
Capital expenditures
including capitalized
leases $ 223,423 $ 202,735
Balance Sheet Data (end
of period):
Working capital $ 229,339 $525,251
Property and equipment, net 596,227 749,649
Total assets 1,122,483 1,619,721
Total long-term debt 312,031 310,366
Shareholders' equity 517,471 954,782
Nine Months Ended
November 1, October 31,
1997 1998
(Unaudited)
Statement of Operations Data:
Net sales $1,982,257 $2,392,215
Cost of merchandise sold 1,317,121 1,582,547
Gross margin 665,136 809,668
Selling, general and
administrative expenses 472,061 565,280
Depreciation and
amortization 41,813 51,383
Preopening expenses 18,589 15,591
Credit operations, non-
recurring(a) - -
Operating income 132,673 177,414
Interest expense, net 18,405 15,627
Income before income taxes
and extraordinary item 114,268 161,787
Income taxes 45,593 63,583
Income before
extraordinary item 68,675 98,204
Extraordinary item(b) - -
Net income $ 68,675 $ 98,204
Per share:
Basic $ .46 $ .62
Diluted .45 .60
Operating Data:
Comparable store sales
growth(c) 10.2% 8.8%
Net sales per selling
square foot(d) $ 178 $ 180
Total square feet of
selling space (in
thousands; end of
period) 12,486 15,129
Number of stores open (end
of period) 182 214(e)
Capital expenditures
including capitalized
leases $ 163,921 $ 183,784
Balance Sheet Data (end of
period):
Working capital $ 468,009 $ 566,557
Property and equipment, net 724,019 883,602
Total assets 1,607,536 1,930,086
Total long-term debt 310,932 379,076
Shareholders' equity 874,561 1,056,938
(footnotes on next page)
<PAGE>
(footnotes from previous page)
(a) Effective September 1, 1995, we terminated our
agreement with Citicorp Retail Services under which
we sold our private label credit card receivables.
At the same time, we established our own credit card
operation. In connection with this transaction, we
incurred a one-time charge of $14.1 million ($8.3
million after-tax).
(b) The extraordinary item reflects an after-tax
charge of $1.8 million to write-off unamortized
deferred financing costs in connection with our
termination of certain credit facilities in January
1994.
(c) Comparable store sales for each period are
based on sales of stores (including relocated or
expanded stores) open throughout the current and
prior year. Comparable store sales growth for fiscal
1996 compares the 52 weeks of fiscal 1996 to the
same 52 week calendar in fiscal 1995 and excludes
the electronics business that we discontinued in
1996. Comparable store sales growth for fiscal 1995
has been adjusted to eliminate the 53rd week in
fiscal 1995.
(d) Net sales per selling square foot is calculated
using net sales of stores that have been open for
the full period, divided by their square footage of
selling space.
(e) We subsequently closed one undersized store in
the Milwaukee market upon expiration of the lease.
<PAGE>
USE OF PROCEEDS
We estimate that we will receive net proceeds from
the offering of approximately $185.9 million, based on
an assumed offering price of $68 9/16 per share. We
intend to use approximately $165 million of the
proceeds to renovate and refixture 33 former Caldor
stores. On March 2, 1999, we purchased the right to
occupy 32 of the store locations and expect to purchase
the rights to occupy the 33rd store location within
thirty days. We intend to use the remaining proceeds
for other general corporate purposes, including
financing our continued store growth. Until we use the
proceeds for these purposes, we will temporarily repay
borrowings under our revolving credit facility and
reduce future sales of accounts receivable under our
accounts receivable financing program. At February 27,
1999, the interest rate payable under our revolving
credit facility was approximately 5 1/8% per annum.
The facility matures on June 12, 2003. We will not
receive any proceeds from the sale of common stock by
the selling stockholders, but we will receive the
exercise price of their employee stock options.
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
The common stock has been traded on the New York
Stock Exchange since May 19, 1992, under the symbol
"KSS." The table below sets forth the high and low
prices of the common stock for the fiscal periods
indicated, adjusted for our 2-for-1 stock splits
effected in April 1996 and April 1998.
Common Stock
Price
High Low
Fiscal 1999
First Quarter (through March 2, 1999) $70 11/16 $63 3/8
Fiscal 1998
First Quarter $43 15/32 $34 11/16
Second Quarter 57 5/8 40 1/2
Third Quarter 58 11/16 34 1/16
Fourth Quarter 67 3/4 45 1/8
Fiscal 1997
First Quarter $25 9/16 $19 7/16
Second Quarter 31 19/32 24 7/8
Third Quarter 37 3/8 29
Fourth Quarter 37 11/16 31 5/16
See the cover page of this prospectus for a recent
reported last sale price.
At January 29, 1999, there were 5,495 holders of
record of our common stock.
We have never paid a cash dividend, have no
current plans to pay dividends, and intend to retain
all our earnings for investment in and growth of our
business. In addition, financial covenants and other
restrictions in our financing agreements limit our
ability to pay dividends. The payment of future
dividends, if any, will be determined by our board of
directors in light of existing conditions, including
our earnings, financial condition and requirements,
restrictions in our financing agreements, business
conditions and other factors they deem relevant.
<PAGE>
CAPITALIZATION
The following table sets forth our consolidated
capitalization as of October 31, 1998, and as adjusted
to give effect to the offering and the exercise of
employee stock options by the selling stockholders. We
based the adjustment on an assumed offering price of
$68 9/16 per share for the 2,800,000 shares that we are
selling in the offering. We also adjusted for the
proceeds that we will receive upon exercise of employee
stock options for 1,309,000 shares of common stock by
the selling stockholders and the related income tax
benefits that we will receive. The adjustments from
the stock option exercises increased total
shareholders' equity by $42.1 million. For purposes of
the table, we have assumed that the U.S. underwriters
do not exercise their over-allotment option and that
$69.5 million of the net proceeds are applied to repay
borrowings under our revolving credit facility. At
February 27, 1999, we had no borrowings under our
revolving credit facility.
As of
October 31, 1998
Actual As Adjusted
(In Thousands)
Long-term debt:
Revolving credit facility $ 69,500 $ ----
Capitalized lease obligations 47,421 47,421
6.57% unsecured senior notes, due 2004 60,000 60,000
6.70% notes, due 2006 100,000 100,000
7 3/8% notes, due 2011 100,000 100,000
Other 2,155 2,155
Total long-term debt 379,076 309,576
Shareholders' equity:
Common stock; 158,202,170 shares
outstanding (162,311,170 shares
after the offering) 1,582 1,623
Paid-in capital 492,498 720,386
Retained earnings 562,858 562,858
Total shareholders' equity 1,056,938 1,284,867
Total capitalization $1,436,014 $1,594,443
<PAGE>
DESCRIPTION OF CAPITAL STOCK
Our authorized capital stock consists of
400,000,000 common shares, $0.01 par value per share,
and 10,000,000 preferred shares, $0.01 par value per
share. As of January 30, 1999, 158,394,735 shares of
common stock and no shares of preferred stock were
issued and outstanding.
Common Stock
Voting. For all matters submitted to a vote of
stockholders, each holder of common stock is entitled
to one vote for each share registered in his or her
name on the books of Kohl's. Our common stock does not
have cumulative voting rights. As a result, subject to
the voting rights of any outstanding preferred stock
and any voting limitations imposed by the Wisconsin
Business Corporation Law, persons who hold more than
50% of the outstanding common stock can elect all of
the directors who are up for election in a particular
year.
Election of Board of Directors. Our articles of
incorporation divide the board of directors into three
classes serving staggered three-year terms. As a
result, at least two annual meetings will generally be
required for stockholders to effect a change of a
majority of the board of directors. Any director, or
the entire board of directors, may be removed from
office only for cause. These provisions in the
articles of incorporation require an 80% vote of
stockholders to amend or repeal.
Dividends. If our board declares a dividend,
holders of common stock will receive payments from the
funds of Kohl's that are legally available to pay
dividends. However, this dividend right is subject to
any preferential dividend rights we may grant to the
persons who hold preferred stock, if any is
outstanding.
Liquidation. If Kohl's is dissolved, the holders
of common stock will be entitled to share ratably in
all the assets that remain after we pay our liabilities
and any amounts we may owe to the persons who hold
preferred stock, if any is outstanding.
Other Rights and Restrictions. Holders of common
stock do not have preemptive rights, and they have no
right to convert their common stock into any other
securities. Our common stock is not redeemable.
Listing. Our common stock is listed on the New
York Stock Exchange.
Transfer Agent and Registrar. The transfer agent
and registrar for our common stock is The Bank of New
York.
Wisconsin Business Corporation Law
Provisions of the Wisconsin Business Corporation
Law ("WBCL") could have the effect of delaying,
deterring or preventing a change in control of Kohl's.
Restrictions on Business Combinations. Sections
180.1130 to 180.1134 of the WBCL provide generally that
for a "resident domestic corporation," such as Kohl's,
business combinations not meeting fair price standards
specified in the statute must be approved by the
affirmative vote of at least (1) 80% of the votes
entitled to be cast by the outstanding voting shares of
the corporation, and (2) two-thirds of the votes
entitled to be cast by the holders of voting shares
that are not beneficially owned by a "significant
shareholder" or an affiliate or associate of a
significant shareholder who is a party to the
transaction. This requirement is in addition to any
vote that may be required by law or our articles of
incorporation. The term "business combination" means,
subject to certain exceptions, a merger or share
exchange of the issuing public corporation (or any
subsidiary of that corporation) with, or the sale or
other disposition of substantially all of the property
and assets of the issuing public corporation to, any
significant shareholder or affiliate of a significant
shareholder. "Significant shareholder" means a person
that is the beneficial owner of 10% or more of the
voting power of the outstanding voting shares of the
issuing public corporation. These statutory sections
also restrict the repurchase of shares and the sale of
corporate assets by an issuing public corporation in
response to a takeover offer.
<PAGE>
Sections 180.1140 to 180.1144 of the WBCL prohibit
certain "business combinations" between a "resident
domestic corporation" and an interested shareholder
within three years after the date such person became an
interested shareholder, unless the business combination
or the acquisition of the interested shareholder's
stock has been approved before the stock acquisition
date by the corporation's board of directors. An
"interested shareholder" is a person beneficially
owning 10% or more of the voting power of the
outstanding voting stock of such corporation. After
the three-year period, a business combination with the
interested shareholder may be consummated only with the
approval of the holders of a majority of the voting
stock not beneficially owned by the interested
shareholder at a meeting called for that purpose,
unless the business combination satisfies specified
adequacy-of-price standards intended to provide a fair
price for shares held by disinterested stockholders.
Control Share Voting Restrictions. Under Section
180.1150(2) of the WBCL, the voting power of shares of
a "resident domestic corporation" that are held by any
person in excess of 20% of the voting power are limited
(in voting on any matter) to 10% of the full voting
power of those excess shares, unless otherwise provided
in the articles of incorporation or unless full voting
rights have been restored at a special meeting of the
stockholders called for that purpose. This statute is
designed to protect corporations against uninvited
takeover bids by reducing to one-tenth of their normal
voting power all shares in excess of 20% owned by an
acquiring person. Section 180.1150(3) excludes shares
held or acquired under certain circumstances from the
application of Section 180.1150(2), including (among
others) shares acquired directly from Kohl's and shares
acquired in a merger or share exchange to which Kohl's
is a party.
Constituency Provision. Under Section 180.0827 of
the WBCL, in discharging his or her duties, a director
or officer of Kohl's may, in addition to considering
the effects of any action on stockholders, consider the
effects of any action on employees, suppliers,
customers, the communities in which Kohl's operates and
any other factors that the director or officer
considers pertinent.
Preferred Stock
Our articles of incorporation authorize the board
of directors to issue preferred stock in one or more
series and to determine the voting rights, dividend
rights, dividend rates, liquidation preferences,
conversion or exchange rights, redemption rights,
including sinking fund provisions and redemption
prices, and other terms and rights of each series.
Although our board of directors does not presently
intend to authorize the issuance of preferred stock, it
could issue a series of preferred stock that could
impede the completion of a merger, tender offer or
other takeover attempt. Our board will issue such a
series of preferred stock only if it determines that
the issuance is in the best interests of Kohl's and its
stockholders. In addition, the terms of a series of
preferred stock might discourage a potential acquiror
from attempting to acquire Kohl's in a manner that
changes the composition of our board of directors, even
when a majority of our stockholders believe that such
an acquisition would be in their best interests or
would receive a premium for their stock over the then
current market price.
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth information about
the beneficial ownership of the common stock as of
December 31, 1998, and after the sale of the common
stock offered hereby, by each selling stockholder. To
calculate the percentage owned after the offering, we
assume no exercise of the U.S. underwriters' over-
allotment option. Each of the selling stockholders
(other than Mr. Sommerhauser) is an executive officer
of Kohl's. Messrs. Kellogg, Baker, Herma, Montgomery,
Mansell and Sommerhauser is each a director. Except as
otherwise noted below, the selling stockholders have
sole voting and investment power with respect to their
shares.
<TABLE>
<CAPTION>
Shares Shares
Beneficially Beneficially
Owned Prior to Shares Owned After
Name of Offering Being Offering
Beneficial Owner Number Percent Offered Number Percent
<S> <C> <C> <C> <C> <C>
William S. Kellogg 11,228,145(a) 7.0% 559,300 10,668,845(a) 6.5%
Jay H. Baker 5,368,718(b) 3.4 400,000(c) 4,968,718(b) 3.1
John F. Herma 6,847,273(d) 4.3 341,100 6,506,173(d) 4.0
R. Lawrence Montgomery 819,960(e) * 41,000 778,960(e) *
Kevin Mansell 639,810(f) * 32,000 607,810(f) *
Caryn Blanc 697,450(g) * 34,900 662,550(g) *
Arlene Meier 390,100(h) * 19,500 370,600(h) *
Jeffrey Rusinow 129,500(i) * 6,500 123,000(i) *
Donald Sharpin 83,500(i) * 4,200 79,300(i) *
Gary Vasques 80,000(i) * 4,000 76,000(i) *
Richard Leto 61,000(i) * 3,000 58,000(i) *
Peter M. Sommerhauser 375,807(j) * 18,500 357,307(j) *
</TABLE>
*Less than 1%.
(footnotes on next page)
<PAGE>
(a) Includes 9,337,245 shares held in trust for the
benefit of Mr. Kellogg's family but as to which Mr.
Sommerhauser has sole voting and investment power
and 43,260 shares held by a charitable foundation
for which Mr. Kellogg serves as a director and
president. Excludes 1,258,900 shares (1,158,900
shares after the offering) held in trust for the
benefit of Mr. Baker's family and as to which Mr.
Kellogg and Mr. Sommerhauser have shared voting and
investment power. Includes 950,000 shares (390,700
shares after the offering) represented by stock
options.
(b) Includes 1,258,900 shares (1,158,900 shares
after the offering) held in trust for the benefit of
Mr. Baker's family as to which Mr. Kellogg and Mr.
Sommerhauser have shared voting and investment power
and 125,660 shares held by a charitable foundation
for which Mr. Baker serves as a director and
president. Also includes 475,000 shares (175,000
shares after the offering) represented by stock
options.
(c) Includes 100,000 shares being offered by the
Jay Baker Children's Trusts.
(d) Includes 5,351,703 shares held in trust for the
benefit of Mr. Herma's family as to which Mr.
Sommerhauser has sole voting and investment power
and 25,150 shares held by a charitable foundation
for which Mr. Herma serves as a director and
president. Also includes 475,000 shares (133,900
shares after the offering) represented by stock
options.
(e) Includes 125,948 shares held in trust for the
benefit of Mr. Montgomery's family as to which Mr.
Sommerhauser has sole voting and investment power.
Also includes 520,828 shares (500,328 shares after
the offering) represented by stock options.
(f) Includes 138,000 shares held in trust for the
benefit of Mr. Mansell's family as to which Mr.
Sommerhauser has sole voting and investment power.
Also includes 327,078 shares (311,078 shares after
the offering) represented by stock options.
(g) Includes 545,454 shares (510,554 shares after
the offering) represented by stock options.
(h) Includes 383,100 shares (363,600 shares after
the offering) represented by stock options.
(i) All of the shares are represented by stock
options.
(j) Excludes 16,461,866 shares (16,361,866 shares
after the offering) held in trust for the benefit of
the families of current and former executive
officers of Kohl's or in charitable foundations
established by executive officers of Kohl's, as to
which Mr. Sommerhauser has sole or shared voting and
investment power. Includes 81,042 shares held in
trust for the benefit of Mr. Sommerhauser's family
as to which Mr. Sommerhauser has no voting or
investment power and 5,500 shares held by a
charitable foundation for which Mr. Sommerhauser
serves as director and president. Includes 2,000
shares represented by stock options.
<PAGE>
UNITED STATES FEDERAL TAX CONSIDERATIONS
TO NON-UNITED STATES HOLDERS
This section summarizes the United States federal
income and estate tax issues that you, as a nonresident
alien individual foreign corporation, foreign
partnership or other foreign shareholder (a "non-United
States shareholder") may consider relevant in
connection with your purchase, ownership and
disposition of our common stock. This summary does not
address all of the United States federal income and
estate tax considerations that may be relevant to you
in light of your particular circumstances or if you are
subject to special treatment under United States
federal income tax laws. Furthermore, this summary
does not discuss any aspects of state, local or foreign
taxation. We base this summary on current provisions
of the federal income tax laws, Treasury regulations,
judicial opinions, published positions of the United
States Internal Revenue Service (the "IRS") and other
applicable authorities, all of which are subject to
change, possibly with retroactive effect. We urge you
to consult your own adviser with respect to the tax
consequences of acquiring, holding and disposing of our
common stock.
Dividends. Dividends that we pay to you generally
will be subject to withholding of United States federal
income tax at the rate or 30% (or such lower rate
specified in an applicable income tax treaty) unless
the dividend is effectively connected with your conduct
of a trade or business within the United States (of if
certain tax treaties apply, is attributable to a United
States permanent establishment maintained by you) and
you file the appropriate documentation with Kohl's or
our transfer agent, in which case you will be subject
to United States federal income tax at graduated rates
in the same manner as United States persons are taxed.
If you are a corporation, such effectively connected
income also may be subject to the branch profits tax at
a rate of 30% (or such lower rate specified in an
applicable income tax treaty), which is generally
imposed on a foreign corporation on the repatriation
from the United States of effectively connected
earnings and profits. You should consult any
applicable income tax treaties that may provide for a
lower rate of withholding or other rules different from
those described above. You may be required to satisfy
certain certification requirements in order to claim
treaty benefits or otherwise claim a reduction of or
exemption from withholding under the foregoing rules.
Sale or Disposition of Common Stock. You
generally will not incur United States federal income
tax on gain recognized on a sale or other disposition
of our common stock unless:
(1) the gain is effectively connected with your
conduct of a trade or business within the United States
or if certain tax treaties apply, is attributable to a
United States permanent establishment maintained by
you;
(2) you are a nonresident alien, hold our common stock
as a capital asset and are present in the United States
for 183 or more days in the taxable year of disposition
and either you have a "tax home" in the United States
or the gain is attributable to an office or other fixed
place of business maintained by you in the United
States;
(3) Kohl's is or has been a "United States real
property holding corporation" for United States federal
income tax purposes (which we likely are not) and in
the event that our common stock is considered regularly
traded, you hold or have held, directly or indirectly,
at any time during the five-year period ending on the
date of disposition (or, if shorter, your holding
period), more than 5% of our common stock, in which
case your gain will be taxed as if it were gain
described in clause (1) above; or
(4) you are subject to tax pursuant to the federal
income tax provisions applicable to certain United
States expatriates.
Gain that is or is treated as effectively
connected with your conduct of a trade or business
within the United States will be subject to United
States federal income tax on the same basis that
applies to United States persons generally (and, with
respect to corporate holders, under certain
circumstances, the branch profits tax) but will not be
subject to withholding. You should consult any
applicable treaties that may provide for different
rules. A non-resident alien holding our common stock
as a capital asset as described in clause (2) above,
generally will incur a
<PAGE>
30% (or such lower rate
specified in an applicable income tax treaty) tax on
the gain derived from the sale, which gain may be
offset by certain United States source capital losses.
Federal Estate Taxes. If an individual who is not
a citizen (as specifically defined for United States
federal estate tax purposes) of the United States at
the time of death owns or is treated as owning our
common stock, then such common stock will be included
in that individual's gross estate for United States
federal estate tax purposes, unless an applicable
estate tax treaty provides otherwise.
Information Reporting and Backup Withholding. We
must report annually to the IRS and to you the amount
of dividends paid to you and the amount of tax withheld
with respect to such dividends, regardless of whether
any tax is actually withheld. This information may
also be made available to the authorities of a country
in which you reside under the provisions of an
applicable income tax treaty or other agreement.
Under current federal income tax law, United
States information reporting requirements and backup
withholding tax at a rate of 31% will generally apply
(1) to dividends that we pay on our common stock to you
at an address within the United States and (2) to
payments to you by a United States office of a broker
of the proceeds of a sale of common stock unless you
certify your non-United States shareholder status under
penalties of perjury or otherwise establish an
exemption. Information reporting requirements (but not
backup withholding) will also apply to payments of the
proceeds of sales of our common stock by foreign
offices or United States brokers, or foreign brokers
with certain types of relationships to the United
States, unless the broker has documentary evidence in
its records that you are a non-United States
shareholder and certain other conditions are met, or
you otherwise establish an exemption.
The United States Treasury Department has issued
regulations generally effective for payments made after
December 31, 1999 that will affect the procedures that
you must follow in establishing your status as a non-
United States shareholder for purposes of the
withholding, backup withholding and information
reporting rules discussed in this prospectus. Among
other things, (1) non-United States shareholders
currently required to furnish certification of foreign
status may be required to furnish new certification of
foreign status, and (2) certain non-United States
shareholders not currently required to furnish
certification of foreign status may be required to
furnish certification of foreign status in the future.
We urge you to consult your tax adviser concerning the
effect of such regulations on an investment in our
common stock.
Backup withholding is not an additional tax. Any
amounts withheld under the backup withholding rules
generally will be refunded or credited against your
United States federal income tax liability, provided
that the required information is furnished to the IRS.
<PAGE>
UNDERWRITERS
Under the terms and subject to the conditions in
the underwriting agreement dated the date of this
prospectus, the U.S. underwriters named below, for whom
Morgan Stanley & Co. Incorporated, Merrill Lynch,
Pierce Fenner & Smith Incorporated, William Blair &
Company, L.L.C. and Robert W. Baird & Co. Incorporated
are acting as U.S. representatives, and the
international underwriters named below, for whom Morgan
Stanley & Co. International Limited, Merrill Lynch
International, William Blair & Company, L.L.C. and
Robert W. Baird & Co. Incorporated are acting as
international representatives, have severally agreed to
purchase, and we and the selling stockholders have
agreed to sell to them, severally, the respective
number of shares of common stock set forth opposite the
names of such underwriters below:
Number of
Name Shares
U.S. Underwriters:
Morgan Stanley & Co. Incorporated
Merrill Lynch, Pierce, Fenner & Smith Incorporated
William Blair & Company, L.L.C.
Robert W. Baird & Co. Incorporated
Subtotal 3,411,200
International Underwriters:
Morgan Stanley & Co. International Limited
Merrill Lynch International
William Blair & Company, L.L.C.
Robert W. Baird & Co. Incorporated
Subotal 852,800
Total 4,264,000
The U.S. underwriters and the international
underwriters, and the U.S. representatives and the
international representatives, are collectively
referred to as the "underwriters" and the
"representatives," respectively. The underwriters are
offering the shares of common stock subject to their
acceptance of the shares from us and the selling
stockholders and subject to prior sale. The
underwriting agreement provides that the obligations of
the several underwriters to pay for and accept delivery
of the shares of common stock offered hereby are
subject to the approval of certain legal matters by
their counsel and to certain other conditions. The
underwriters are obligated to take and pay for all of
the shares of common stock offered hereby (other than
those covered by the U.S. underwriters' over-allotment
option described below) if any such shares are taken.
Pursuant to the Agreement between U.S. and
International Underwriters, each U.S. underwriter has
represented and agreed that, with certain exceptions:
o it is not purchasing any shares (as defined
herein) for the account of anyone other than a United
States or Canadian person (as defined herein); and
o it has not offered or sold, and will not offer or
sell, directly or indirectly, any shares or distribute
any prospectus relating to the shares outside the
United States or Canada or to anyone other than a
United States or Canadian person.
<PAGE>
Pursuant to the Agreement between U.S. and
International Underwriters, each international
underwriter has represented and agreed that, with
certain exceptions:
o it is not purchasing any shares for the account of
any United States or Canadian person; and
o it has not offered or sold, and will not offer or
sell, directly or indirectly, any shares or distribute
any prospectus relating to the shares in the United
States or Canada or to any United States or Canadian
person.
With respect to any underwriter that is a U.S.
underwriter and an international underwriter, the
foregoing representations and agreements (1) made by it
in its capacity as a U.S. underwriter apply to it in
its capacity as a U.S. underwriter and (2) made by it
in its capacity as an international underwriter apply
only to it in its capacity as an international
underwriter. The foregoing limitations do not apply to
stabilization transactions or to certain other
transactions specified in the Agreement between U.S.
and International Underwriters. As used herein,
"United States" or "Canadian" person means any national
or resident of the United States or Canada, or any
corporation, pension, profit-sharing or other trust or
other entity organized under the laws of the United
States or Canada or of any political subdivision
thereof (other than a branch located outside the United
States and Canada of any United States or Canadian
person), and includes any United States or Canadian
branch of a person who is otherwise not a United States
or Canadian person. All shares of common stock to be
purchased by the underwriters under the Underwriting
Agreement are referred to herein as the "shares."
Pursuant to the Agreement between U.S. and
International Underwriters, sales may be made between
U.S. underwriters and international underwriters of any
number of shares as may be mutually agreed. The per
share price of any shares so sold shall be the public
offering price set forth on the cover page hereof, in
United States dollars, less an amount not greater than
the per share amount of the concession to dealers set
forth below.
Pursuant to the Agreement between U.S. and
International Underwriters, each U.S. underwriter has
represented that it has not offered or sold, and has
agreed not to offer or sell, any shares, directly or
indirectly, in any province or territory of Canada or
to, or for the benefit of, any resident of any province
or territory of Canada in contravention of the
securities laws thereof and has represented that any
offer or sale of shares in Canada will be made only
pursuant to an exemption from the requirement to file a
prospectus in the province or territory of Canada in
which such offer or sale is made. Each U.S.
underwriter has further agreed to send to any dealer
who purchases from it any of the shares a notice
stating in substance that, by purchasing such shares,
such dealer represents and agrees that it has not
offered or sold, and will not offer or sell, directly
or indirectly, any of such shares in any province or
territory of Canada or to, or for the benefit of, any
resident of any province or territory of Canada in
contravention of the securities laws thereof and that
any offer or sale of shares in Canada will be made only
pursuant to an exemption from the requirement to file a
prospectus in the province or territory of Canada in
which such offer or sale is made, and that such dealer
will deliver to any other dealer to whom it sells any
of such shares a notice containing substantially the
same statement as is contained in this sentence.
Pursuant to the Agreement between U.S. and
International Underwriters, each international
underwriter has represented and agreed that:
o it has not offered or sold and, prior to the date
six months after the closing date for the sale of the
shares to the international underwriters, will not
offer or sell, any shares to persons in the United
Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or
disposing of investments (as principal or agent) for
the purposes of their businesses or otherwise in
circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom
within the meaning of the Public Offers of Securities
Regulations 1995;
o it has complied and will comply with all
applicable provisions of the Financial Services Act
1986 with respect to anything done by it in relation to
the shares in, from or otherwise involving the United
Kingdom; and
<PAGE>
o it has only issued or passed on and will only
issue or pass on in the United Kingdom any document
received by it in connection with the offering of the
shares to a person who is of a kind described in
Article 11(3) of the Financial Services Act of 1986
(Investment Advertisements) (Exemptions) Order 1996 (as
amended) or is a person to whom such document may
otherwise lawfully be issued or passed on.
Pursuant to the Agreement between U.S. and
International Underwriters, each international
underwriter has further represented that it has not
offered or sold, and has agreed not to offer to sell,
directly or indirectly, in Japan or to or for the
account of any resident thereof, any of the shares
acquired in connection with the distribution
contemplated hereby, except for offers or sales to
Japanese international underwriters or dealers and
except pursuant to any exemption from the registrations
requirements of the Securities and Exchange Law and
otherwise in compliance with applicable provisions of
Japanese law. Each international underwriter has
further agreed to send to any dealer who purchases from
it any of the shares a notice stating in substance
that, by purchasing such shares, such dealer represents
and agrees that it has not offered or sold, and will
not offer or sell, any of such shares, directly or
indirectly, in Japan or to or for the account of any
resident thereof except for offers or sales to Japanese
international underwriters or dealers and except
pursuant to any exemption from the registration
requirements of the Securities and Exchange Law and
otherwise in compliance with applicable provisions of
Japanese law, and that such dealer will send to any
other dealer to whom it sells any of such shares a
notice containing substantially the same statement as
is contained in this sentence.
The underwriters initially propose to offer part
of the common stock directly to the public at the
public offering price set forth on the cover page
hereof and part to certain dealers at a price which
represents a concession not in excess of $ a
share under the public offering price. Any underwriter
may allow, and such dealers may reallow, a concession
not in excess of $ a share to other underwriters
or to certain dealers. After the initial offering of
the common stock, the offering price and other selling
terms may from time to time be varied by the
representatives.
We have granted the U.S. underwriters an option,
exercisable for 30 days from the date of this
prospectus, to purchase up to an aggregate of 639,600
additional shares of common stock at the public
offering price set forth on the cover page hereof, less
underwriting discounts and commissions. The U.S.
underwriters may exercise such option to purchase
solely for the purpose of covering over-allotments, if
any, made in connection with the offering of the shares
of common stock offered hereby. To the extent such
option is exercised, each U.S. underwriter will become
obligated, subject to certain conditions, to purchase
approximately the same percentage of such additional
shares of common stock as the number set forth next to
such U.S. underwriter's name in the preceding table
bears to the total number of shares of common stock set
forth next to the names of all U.S. underwriters in the
preceding table. If the U.S. underwriters' option is
exercised in full, the total price to the public would
be $ , the total underwriters' discounts and
commissions would be $ and the total
proceeds to Kohl's would be $ .
In the underwriting agreement:
o we have agreed to pay the printing, legal,
accounting and other expenses related to the offering,
which we estimate will be $350,000; and
o Kohl's, the selling stockholders and the
underwriters have agreed to indemnify each other
against certain liabilities, including liabilities
under the Securities Act of 1933, as amended.
Kohl's and each of the selling stockholders has
agreed that, without the prior written consent of
Morgan Stanley & Co. Incorporated on behalf of the
underwriters, it will not during the period ending 90
days after the date of this prospectus:
o offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to
purchase, lend or otherwise transfer or dispose of,
directly or indirectly, any shares of common stock or
any securities convertible into or exercisable or
exchangeable for common stock or
<PAGE>
o enter into any swap or other arrangement that
transfers to another, in whole or in part, any of the
economic consequences of ownership of the common stock;
whether any such transaction described above is to be
settled by delivery of common stock or such other
securities, in cash or otherwise, except under certain
limited circumstances.
In order to facilitate the offering of the common
stock, the underwriters may engage in transactions that
stabilize, maintain or otherwise affect the price of
the common stock. Specifically, the underwriters may
over-allot in connection with the offering, creating a
short position in the common stock for their own
account. In addition, to cover over-allotments or to
stabilize the price of the common stock, the
underwriters may bid for, and purchase, shares of
common stock in the open market. Finally, the
underwriting syndicate may reclaim selling concessions
allowed to an underwriter or a dealer for distributing
shares of common stock in the offering, if the
syndicate repurchases previously distributed common
stock in transactions to cover syndicate short
positions, in stabilization transactions or otherwise.
Any of these activities may stabilize or maintain the
market price of the common stock above independent
market levels. The underwriters are not required to
engage in these activities, and may end any of these
activities at any time.
Certain underwriters from time to time perform
various investment banking services for us, for which
such underwriters receive compensation.
LEGAL MATTERS
Certain legal matters will be passed upon for
Kohl's by Godfrey & Kahn, S.C., Milwaukee, Wisconsin,
and for the underwriters by Shearman & Sterling, New
York, New York. Mr. Peter M. Sommerhauser is a
director of Kohl's and a shareholder and member of the
management committee of Godfrey & Kahn, S.C. As of
December 31, 1998, Mr. Sommerhauser beneficially owned
375,807 shares of common stock and had sole or shared
voting and investment power with respect to an
additional 16,461,866 shares.
EXPERTS
The consolidated financial statements of Kohl's
appearing in Kohl's Corporation Annual Report (Form 10-
K) for the year ended January 31, 1998, have been
audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated
financial statements are incorporated herein by
reference in reliance upon such report given on the
authority of such firm as experts in accounting and
auditing.
FORWARD-LOOKING STATEMENTS
Statements in this prospectus or incorporated by
reference in this prospectus that are not statements of
historical fact may be deemed to be "forward-looking
statements," subject to protections under federal law.
We intend words such as "believes," "anticipates,"
"plans," "expects" and similar expressions to identify
forward-looking statements. In addition, statements
covering our future performances and our plans,
objectives, expectations or intentions are forward-
looking statements, such as statements regarding our
debt service requirements, planned capital
expenditures, future store openings and adequacy of
capital resources. There are a number of important
factors that could cause our results to differ
materially from those indicated by the forward-looking
statements, including among others those discussed
under "Management's Discussion and Analysis of
Financial Condition and Results of Operations" sections
of our annual and quarterly reports and as follows:
o heightened competition;
o adverse weather conditions in our retail markets;
o increases in interest rates;
<PAGE>
o increases in real estate, construction and
development costs;
o inventory imbalances caused by unanticipated
fluctuations in consumer demand;
o trends in the economy which affect consumer
confidence and demand for our merchandise;
o our ability to find suitable store sites that we
can acquire on acceptable terms;
o our ability to continue to hire, train and retain
sufficient numbers of capable and talented associates;
and
o interruptions in our business as a result of the
Year 2000 computer problem in our systems or in the
systems of one of our major suppliers.
WHERE YOU CAN FIND MORE
INFORMATION
We file annual, quarterly and special reports,
proxy statements and other information with the SEC.
Our SEC filings are available to the public over the
internet at the SEC's web site at http://www.sec.gov.
You may also read and copy any document we file at the
SEC's public reference room located at 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as at
the regional offices of the SEC located at 7 World
Trade Center, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Chicago, Illinois
60661. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms and
their copy charges.
Our common stock is listed on the New York Stock
Exchange. You may also inspect the information we file
with the SEC at the New York Stock Exchange, 20 Broad
Street, New York, New York 10005.
The SEC allows us to "incorporate by reference"
into this prospectus the information we file with them,
which means that we can disclose important information
to you by referring you to those documents. The
information incorporated by reference is considered to
be part of this prospectus, and information that we
file later with the SEC will automatically update and
supersede this information. We incorporate by
reference the documents listed below and any future
filings we will make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of
1934:
(1) our annual report on Form 10-K for the
fiscal year ended January 31, 1998;
(2) our quarterly reports on Form 10-Q for the
quarterly periods ended May 2, 1998, August 1,
1998 and October 31, 1998; and
(3) the description of our common stock
contained in our registration statement on Form
8-B dated June 25, 1993, as updated from time
to time by our subsequent filings with the SEC.
You may also request a copy of these filings
(excluding exhibits), at no cost, by writing or
telephoning our chief financial officer at the
following address:
Arlene Meier
Kohl's Corporation
N56 W17000 Ridgewood Drive
Menomonee Falls, WI 53051
(414) 703-7000
<PAGE>
KOHL'S
<PAGE>
INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE.
THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE
NOT SOLICITING OFFERS TO BUY THESE SECURITIES IN ANY STATE WHERE THE
OFFER AND SALE IS NOT PERMITTED.
PROSPECTUS (Subject to Completion) [Alternate Page for International
Issued March 3, 1999 Prospectus]
4,264,000 Shares
KOHL'S
Common Stock
Kohl's Corporation is offering 2,800,000 shares and the
selling stockholders are offering 1,464,000 shares.
Initially, the international underwriters are offering
852,800 shares outside the United States and Canada,
and the U.S. underwriters are offering 3,411,200 shares
in the United States and Canada.
Kohl's Corporation's common stock is listed on the New
York Stock Exchange under the symbol "KSS." On
March 2, 1999, the reported last sale price of the
common stock on the New York Stock Exchange was
$68 9/16 per share.
PRICE $ A SHARE
Proceeds
Price to Underwriting Proceeds to to
Public Discounts Company Selling
and Stockholders
Commissions
Per Share $ $ $ $
Total $ $ $ $
The Securities and Exchange Commission and state
securities regulators have not approved or
disapproved these securities, or determined if this
prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
Kohl's Corporation has granted the U.S. underwriters
the right to purchase up to an additional 639,600
shares of common stock to cover over-allotments.
Morgan Stanley & Co. Incorporated expects to deliver
the shares to purchasers on ________________, 1999.
MORGAN STANLEY DEAN WITTER
MERRILL LYNCH INTERNATIONAL
WILLIAM BLAIR & COMPANY
ROBERT W. BAIRD & CO.
Incorporated
__________________, 1999
<PAGE>
PART II
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth those expenses to
be incurred by the Company in connection with the
issuance and distribution of the securities being
registered, other than underwriting discounts and
commissions. All of the amounts shown are estimates,
except the applicable Securities and Exchange
Commission registration fee.
SEC registration fee $91,207
Printing expenses 85,000
Legal fees 100,000
Accounting fees 40,000
NYSE listing fees 14,000
Blue sky fees and expenses 5,000
Miscellaneous expenses 14,793
Total $350,000
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 180.0851 of the Wisconsin Business
Corporation Law (the "WBCL") requires the Company to
indemnify a director or officer, to the extent such
person is successful on the merits or otherwise in the
defense of a proceeding for all reasonable expenses
incurred in the proceeding, if such person was a party
to such proceeding because he or she was a director or
officer of the Company unless it is determined that he
or she breached or failed to perform a duty owed to the
Company and such breach or failure to perform
constitutes: (i) a willful failure to deal fairly with
the Company or its shareholders in connection with a
matter in which the director or officer has a material
conflict of interest; (ii) a violation of criminal law,
unless the director or officer had reasonable cause to
believe his or her conduct was unlawful; (iii) a
transaction from which the director or officer derived
an improper personal profit; or (iv) willful
misconduct.
Section 180.0858 of the WBCL provides that subject
to certain limitations, the mandatory indemnification
provisions do not preclude any additional right to
indemnification or allowance of expenses that a
director or officer may have under the article of
incorporation or bylaws of the Company, a written
agreement between the director or officer and the
Company, or a resolution of the Board of Directors or
the shareholders.
Unless otherwise provided in the Company's
articles of incorporation or bylaws, or by written
agreement between the director or officer and the
Company, an officer or director seeking indemnification
is entitled to indemnification if approved in any of
the following manners as specified in Section 180.0855
of the WBCL: (i) by majority vote of a disinterested
quorum of the board of directors; (ii) by independent
legal counsel chosen by a quorum of disinterested
directors or its committee; (iii) by a panel of three
arbitrators (one of which is chosen by a quorum of
disinterested directors); (iv) by the vote of the
shareholders; (v) by a court; or (vi) by any other
method permitted in Section 180.0858 of the WBCL.
Reasonable expenses incurred by a director or
officer who is a party to a proceeding may be
reimbursed by the Company, pursuant to Section 180.0853
of the WBCL, at such time as the director or officer
furnishes to the Company written affirmation of his or
her good faith that he or she has not breached or
failed to perform his or her duties and written
confirmation to repay any amounts advanced if it is
determined that indemnification by the Company is not
required.
Section 180.0859 of the WBCL provides that it is
the public policy of the State of Wisconsin to require
or permit indemnification, allowance of expenses or
insurance to the extent required or permitted under
Sections 180.0850 or 180.0858 of the WBCL for any
liability incurred in connection with a proceeding
involving a federal or state statute, rule or
regulation regulating the offer, sale or purchase of
securities.
<PAGE>
As permitted by Section 180.0858, the Company has
adopted indemnification provisions in its By-Laws which
closely track the statutory indemnification provisions
with certain exceptions. In particular, Article VIII
of the Company's By-Laws, among other items, provides
(i) that an individual shall be indemnified unless it
is proven by a final judicial adjudication that
indemnification is prohibited and (ii) payment or
reimbursement of expenses, subject to certain
limitations, will be mandatory rather than permissive.
Through insurance, the officers and directors of
the Company are also insured for acts or omissions
related to the conduct of their duties. The insurance
covers certain liabilities which may arise under the
Securities Act of 1933, as amended.
Under Section 180.0828 of the WBCL, a director of
the Company is not personally liable for breach of any
duty resulting solely from his or her status as a
director, unless it shall be proved that the director's
conduct constituted conduct described in the first
paragraph of this item.
ITEM 16. EXHIBITS
1.1* Form of Underwriting Agreement.
3.1 Articles of Incorporation of the Company,
as amended, incorporated by reference to Exhibit
10.16 of the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended August 3,
1996.
3.2 Bylaws of the Company, as amended,
incorporated by reference to Exhibit 10.14 of
the Company's Quarterly Report on Form 10-Q for
the fiscal quarter ended May 4, 1996.
5.1 Opinion of Godfrey & Kahn, S.C.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Godfrey & Kahn, S.C. (included
in exhibit 5.1).
24.1 Powers of Attorney (included on the
signature page).
_____________
* To be filed by amendment or as an exhibit to a
document to be incorporated by reference herein.
ITEM 17. UNDERTAKINGS
1. The undersigned registrant hereby undertakes
that, for purposes of determining any liability
under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange
Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a
new registration statement relating to the
securities offered therein, and the offering of
such securities at the time shall be deemed to be
the initial bona fide offering thereof.
2. Insofar as indemnification for liabilities
arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling
persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the
Securities and Exchange Commission such
indemnification is against public policy as
expressed in the Act and is, therefore,
unenforceable. In the event that a claim for
indemnification against such liabilities (other
than the payment by the registrant of expenses
incurred or paid by a director, officer or
controlling person of the registrant in the
successful defense of any action, suit or
proceeding) is asserted by such director, officer
or controlling person in connection with the
securities being registered, the 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 financial adjudication of
such issue.
<PAGE>
3. The undersigned registrant hereby undertakes
that:
(1) For purposes of determining any liability
under the Securities Act of 1933, the
information omitted from the form of prospectus
filed as part of this Registration Statement in
reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant
to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be a part of
this registration statement as of the time it
was declared effective.
(2) For the purpose of determining any
liability under the Securities Act of 1933,
each post-effective amendment that contains a
form of prospectus 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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act
of 1933, the registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the
City of Menomonee Falls, State of Wisconsin, on March
2, 1999.
KOHL'S CORPORATION
By:/s/ William S. Kellogg
-------------------------
William S. Kellogg
Chairman of the Board
POWER OF ATTORNEY
Each person whose signature appears below appoints
William S. Kellogg, Jay H. Baker, John F. Herma,
R. Lawrence Montgomery and Kevin Mansell, and each of
them, as his true and lawful attorney-in-fact and agent
with full power of substitution and resubstitution, for
him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including
post-effective amendments), to this Registration
Statement (or any other Registration Statement for the
same offering that is to be effective upon filing
pursuant to Rule 462(b) under the Securities Act of
1933, as amended) and to file the same, with all
exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission,
and any other regulatory authority, granting unto each
said attorney-in-fact and agent full power and
authority to do and perform each and every act and
thing, requisite and necessary to be done in and about
the foregoing, as fully to all intents and purposes as
he might or could do in person, hereby ratifying and
confirming all that each said attorney-in-fact and
agent, or his substitute, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act
of 1933, this Registration Statement has been signed by
the following persons in the capacities and on the
dates indicated:
/s/ William S. Kellogg /s/ Jay H. Baker
- ----------------------------- ----------------------------
William S. Kellogg Jay H. Baker
Chairman and Director Director
/s/ John F. Herma /s/ R. Lawrence Montgomery
- ----------------------------- -----------------------------
John F. Herma R. Lawrence Montgomery
Chief Operating Officer Vice Chairman, Chief
and Director Executive Officer and
Director
/s/ Kevin Mansell
- ----------------------------- ------------------------------
Kevin Mansell James Ericson
President and Director Director
/s/ Arlene Meier
- ----------------------------- ------------------------------
Arlene Meier, Chief Herbert Simon
Financial Officer Director
(Principal Financial and
Accounting Officer)
/s/ Frank V. Sica /s/ R. Elton White
- ----------------------------- -------------------------------
Frank V. Sica R. Elton White
Director Director
/s/ Peter M. Sommerhauser
- -----------------------------
Peter M. Sommerhauser
Director
Dated: March 2, 1999
GODFREY & KAHN, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202-3590
Tel: 414-273-3500 Fax: 414-273-5198
March 2, 1999
Kohl's Corporation
N56 W17000 Ridgewood Drive
Menomonee Falls, Wisconsin 53051
Ladies and Gentlemen:
In connection with the registration of 4,903,600
shares of common stock, par value $0.01 per share (the
"Shares"), of Kohl's Corporation, a Wisconsin
corporation (the "Company"), under the Securities Act
of 1933, as amended, on Form S-3 to be filed with the
Securities and Exchange Commission on or about March
2, 1999 (the "Registration Statement"), you have
requested our opinion with respect to the following
matters.
Of the Shares being registered, (i) 2,800,000
Shares are being sold by the Company (the "Primary
Shares"), (ii) 1,464,000 Shares are either presently
issued and outstanding (the "Outstanding Shares") or
will be issued by the Company upon exercise of
outstanding stock options granted under one of the
Company's stock option plans (the "Employee Option
Shares") and are being sold by certain shareholders
named in the Registration Statement and (iii) 639,600
Shares will be subject to an option to be granted by
the Company to the U.S. underwriters named in the
Registration Statement to cover over-allotments (the
"Over-Allotment Shares") pursuant to the underwriting
agreement in the form to be filed as an exhibit to the
Registration Statement (the "Underwriting Agreement").
In our capacity as your counsel in connection with
such registration, we are familiar with the proceedings
taken and proposed to be taken by the Company in
connection with the authorization, issuance and sale of
the Shares, and, for purposes of this opinion, have
assumed such proceedings will be timely completed in
the manner presently proposed. We have further assumed
that all outstanding option grants were properly
authorized in accordance with the Company's 1992 Long-
Term Compensation Plan or 1994 Long-Term Compensation
Plan. In addition, we have made such legal and factual
examinations and inquiries, including an examination of
originals or copies certified or otherwise identified
to our satisfaction of such documents, records and
papers as we have deemed necessary or appropriate for
purposes of this opinion. We have, with your consent,
relied as to factual matters on certificates or other
documents furnished by the Company and upon such other
documents and data that we have deemed appropriate and,
for purposes of this opinion, have assumed that the
certificates and other documents to be furnished in
connection with the closing of the sale of the Shares
will be delivered in the manner presently proposed. We
have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as
originals and the conformity to original documents of
all documents submitted to us as copies.
With your consent, we are opining herein only on
the laws of the State of Wisconsin. We express no
opinion with respect to the applicability thereto, or
the effect thereon, of any other laws or the laws of
any other jurisdiction.
Based on such examination and review, and subject
to the foregoing, we are of the opinion that:
1. The Primary Shares have been duly authorized,
and, upon issuance, delivery and payment
therefor in the manner contemplated by the
Underwriting Agreement, will be validly
issued, fully paid and non-assessable,
subject to Section 180.0622(2)(b) of the
Wisconsin Business Corporation Law (the
"WBCL").
2. The Outstanding Shares have been duly
authorized and validly issued and are fully
paid and non-assessable, subject to Section
180.0622(2)(b) of the WBCL.
3. The Employee Option Shares have been duly
authorized, and, upon issuance, delivery and
payment therefor in the manner contemplated
by the respective employee stock options and
the related stock option plans, will be
validly issued, fully paid and nonassessable,
subject to Section 180.0622(2)(b) of the
WBCL.
4. The Over-Allotment Shares have been duly
authorized, and, upon issuance, delivery and
payment therefor in the manner contemplated
by the Underwriting Agreement, will be
validly issued, fully paid and non-
assessable, subject to Section 180.0622(2)(b)
of the WBCL.
Section 180.0622(2)(b) of the WBCL provides that
shareholders of a corporation may be assessed up to the
par value of their shares to satisfy the obligations of
such corporation to its employees for services
rendered, but not exceeding six months service in the
case of any individual employee. Certain Wisconsin
courts have interpreted "par value" to mean the full
amount paid by the purchaser of shares upon issuance
thereof.
We hereby consent to the filing of this opinion as
an exhibit to the Registration Statement and to the
reference to our firm under the caption "Legal Matters"
in the prospectus that is a part of the Registration
Statement. In giving such consent, we do not admit
that we are in the category of persons whose consent is
required under Section 7 of the Securities Act of 1933,
as amended.
Very truly yours,
/s/ Godfrey & Kahn, S.C.
Godfrey & Kahn, S.C.
Consent of Ernst & Young LLP
We consent to the reference to our firm under the
captions "Selected Consolidated Financial Data" and
"Experts" in the Registration Statement (Form S-3) and
related Prospectus of Kohl's Corporation for the
registration of 4,903,600 shares of its common stock
and to the incorporation by reference therein of our
report dated March 9, 1998, with respect to the
consolidated financial statements of Kohl's Corporation
included in its Annual Report (Form 10-K) for the year
ended January 31, 1998, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Milwaukee, Wisconsin
March 1, 1999
