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EXHIBIT 99.12
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE OFFERED OR SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. EACH INITIAL PURCHASER OF THIS
SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS TO AND AGREES WITH THE ISSUER
THAT SUCH PURCHASER WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY (WITHOUT
CONSENT OF THE ISSUER) PRIOR TO THREE YEARS FROM MAY 28, 1993 OTHER THAN (I) TO
A QUALIFIED INSTITUTIONAL BUYER, OR TO A PERSON SUCH INITIAL PURCHASER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, IN A TRANSACTION
COMPLYING WITH RULE 144A, (II) TO A NON-U.S. PERSON IN A TRANSACTION COMPLYING
WITH REGULATION S UNDER THE SECURITIES ACT OR (III) PURSUANT TO ANOTHER
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, EACH AS CONFIRMED BY AN
OPINION OF COUNSEL, AS REQUIRED UNDER THE INDENTURE. EACH SUBSEQUENT PURCHASER
OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS TO AND AGREES WITH THE
ISSUER THAT SUCH PURCHASER WILL NOT SELL OR OTHERWISE TRANSFER THIS SECURITY
(WITHOUT THE CONSENT OF THE ISSUER) PRIOR TO THREE YEARS FROM MAY 28, 1993
OTHER THAN PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.
EACH PURCHASER BY ITS ACCEPTANCE HEREOF AGREES THAT IT WILL NOTIFY ANY
PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS DESCRIBED ABOVE.
THE PURCHASER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF,
REPRESENTS ALSO THAT IT IS ACTIVELY AND REGULARLY ENGAGED IN THE BUSINESS OF
LENDING MONEY AS A QUALIFIED PERSON WITHIN THE MEANING OF SECTION 465(b)(6)(D)
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. THIS SECURITY, OR DIRECT OR
INDIRECT BENEFICIAL INTERESTS THEREIN, MAY BE TRANSFERRED ONLY IN ORIGINAL
PRINCIPAL AMOUNTS NOT LESS THAN THOSE PROVIDED FOR IN AND IN ACCORDANCE WITH
THE REGISTRATION PROVISIONS OF, THAT CERTAIN TRUST INDENTURE DATED AS OF MAY
28, 1993 REFERRED TO IN THIS NOTE, COPIES OF WHICH ARE AVAILABLE FOR INSPECTION
AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE.
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New York, New York
May 28, 1993
7.45% SERIES B-1 SENIOR SECURED NOTES DUE 2013
Registered No.: 1
Principal Amount: $1,300,625
Registered Holder: XXXXXXXXXX
KMART CORPORATION, a corporation organized and in good
standing under the laws of the State of Michigan ("Owner"), for value received,
hereby promises to pay to the Registered Holder shown above ("Payee"), or its
registered assigns, on or before June 15, 2013, as herein provided, the
principal sum shown above and to pay interest on the unpaid principal amount
hereof from the date hereof to maturity at the rate of 7.45% per annum computed
on the basis of a 360-day year of twelve 30-day months.
Such principal, premium, if any, and interest shall be payable
upon presentation of this Note (except that upon compliance with the conditions
of Section 203 of the Indenture, such payment shall be made by wire transfer to
the Registered Holder hereof) at the corporate trust office of XXXXXXXXXX
or its successor, not in its individual capacity, but solely as trustee
(the "Trustee") under the Trust Indenture, dated as of May 28, 1993 (herein,
together with all supplements and amendments thereto, the "Indenture"), from
Owner, as issuer, to the Trustee and XXXXXXXXXX, as individual trustee
(the "Individual Trustee," and, together with the Trustee, the "Trustees"), in
lawful money of the United States of America, in the following manner:
(i) One payment of interest only (payable in arrears) in
the amount set forth on the attached Schedule I
(which is hereby made a part hereof) for the first,
unnumbered period on said Schedule, payable June 15,
1993; and
(ii) Forty semi-annual payments of interest
(payable in arrears) and principal, each in the
amount set forth on attached Schedule I for periods
numbered one through forty shall be payable on
the fifteenth day of each June and December,
commencing on December 15, 1993 and continuing to and
including June 15, 2013; the final payment shall
also include
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all other amounts, if any, then due and owing with
respect to this Note or pursuant to the terms of the
Indenture.
The payments described in clauses (i) and (ii) are herein called the
"Installment Payments" and the dates upon which such payments are due are
herein called the "Installment Payment Dates".
Any Installment Payment or other payment due and payable on a
day which is not a Business Day shall be payable by Owner on the immediately
succeeding Business Day without additional interest or charge.
Owner agrees, to the extent not prohibited by applicable law,
to pay interest on any overdue Installment Payment or prepayment of principal
or Make-Whole Payment at the Overdue Rate (as such terms are defined in the
below-described Trust Indenture) on a per diem basis.
This Note is one of Owner's Series B Notes, which are issued
in subseries -1 and -2 (together with Owner's Series A Notes, the "Notes"),
which Notes are equally and ratably secured by and entitled to the benefits of
the Indenture, subject to the terms thereof and of the other Loan Documents.
In addition, the subseries -1 Notes are equally and ratably secured by and
entitled to the benefits of the Deed of Trust, Fixture Filing and Security
Agreement, dated as of the date hereof, between Owner and the Individual
Trustee (the "Deed of Trust"), and the subseries -2 Notes are equally and
ratably secured by and entitled to the benefits of the Mortgage, Security
Agreement and Financing Statement, dated as of the date hereof, between Owner
and the Trustees (the "Mortgage"). The Indenture, the Deed of Trust and the
Mortgage contain, inter alia, provisions for the acceleration of maturity of
this Note upon the happening of certain Events of Default as defined therein,
certain events of condemnation or taking of any Property and certain other
events. Additionally, reference is hereby made to the Indenture, the Deed of
Trust and the Mortgage for a description of the Trust Estate Granted by the
Indenture, the nature and extent of the security for the Notes, the rights of
the Registered Holders, the Trustee and Owner in respect of such security and
otherwise and a description of the terms upon which the Notes are authenticated
and delivered. Capitalized terms not otherwise defined herein have the
meanings set forth in the Indenture.
The principal of this Note is subject to prepayment in whole
or in part at the option of Owner only in the manner, to the extent, and under
the circumstances
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set forth in the Indenture at a price equal to 100% of the outstanding
principal amount hereof to be prepaid, together with interest accrued thereon
to the date of prepayment, plus any premium, if required pursuant to the terms
of the Indenture.
Upon the occurrence of an Event of Default specified in the
Deed of Trust or the Mortgage, the principal hereof, the Make-Whole Payment
hereon, if any, the interest accrued and unpaid hereon, if any, and all other
amounts then due and payable hereon may be declared to be forthwith due and
payable as provided in the Indenture.
By placing its initials immediately following this paragraph,
Owner expressly agrees that in the event of an acceleration of the maturity of
this Note as a result of any event of default, including, without limitation,
any acceleration upon the transfer of any interest in the Trust Estate, a
tender by Owner or by anyone on behalf of Owner of payment of the amount
necessary to satisfy the indebtedness evidenced hereby made at any time prior
to a foreclosure sale, or a sale under the power of sale contained in the Deed
of Trust, shall constitute an evasion of the prepayment terms hereof and shall
be deemed to be a voluntary prepayment hereunder. Therefore, with any such
payment, the Owner shall pay to the Registered Holder the Make-Whole Payment.
Owner expressly waives the provisions of any present or future statute or law
which prohibits or may prohibit the collection of the foregoing Make-Whole
Payment in connection with any such acceleration, including, without
limitation, California Civil Code Section 2954.10.
/s/
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Initials
The Notes are issuable only as fully registered Notes. Owner
and the Trustee shall deem and treat the Person in whose name this Note is
registered on the Register as the absolute owner hereof (whether or not this
Note shall be overdue) for the purpose of receiving payments of principal,
premium, if any, and interest and for all other purposes, and neither Owner nor
the Trustee shall be affected by any notice to the contrary. Subject to and in
accordance with the provisions of the Indenture, this Note may be transferred
and exchanged for Notes of other denominations in accordance with the
procedures set forth in the Indenture.
Should any indebtedness represented by this Note be collected
at law or in equity, or in bankruptcy or other proceedings, or should this Note
be placed in the hands of attorneys for collection after default, Owner agrees
to pay,
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in addition to the principal, premium, if any, and interest due and payable
hereon, if any, all costs of collecting or attempting to collect this Note,
including attorneys' reasonable fees and expenses (including those incurred
in connection with any appeal).
Subject to certain limitations in the Indenture, at any time
when Owner is not subject to Section 13 or 15(d) of the United States
Securities Exchange Act of 1934, upon the request of a Payee, Owner will
promptly furnish or cause to be furnished Rule 144A Information (as defined
below) to such Payee or to a purchaser of this Security designated by such
Payee, as the case may be, in order to permit compliance by such Payee with
Rule 144A under the Securities Act. "Rule 144A Information" shall be such
information as is specified in Rule 144A(d) under the Securities Act (or any
successor provision thereto).
THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, (i) THE INTERNAL LAWS OF THE STATE OF NEW YORK
(WITHOUT REGARD TO CONFLICTS OF LAWS) AS TO INTERPRETATION, ENFORCEMENT,
VALIDITY, CONSTRUCTION, EFFECT AND IN ALL OTHER RESPECTS, INCLUDING, BUT NOT
LIMITED TO, THE LEGALITY OF THE INTEREST RATE AND OTHER CHARGES, AND (ii) THE
FEDERAL LAWS OF THE UNITED STATES OF AMERICA WITH REGARD TO U.S. FEDERAL
SECURITIES LAW, ERISA AND ANY OTHER APPLICABLE MATTERS.
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IN WITNESS WHEREOF, Owner has caused this Note to be duly
executed.
KMART CORPORATION
By: /s/ X.X. XXXXXX
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X.X. Xxxxxx
Senior Vice President
[SEAL]
Attest: /s/
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Name:
Title:
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Trustee's Certificate of Authentication
This Note is one of the Series B Notes of Kmart Corporation
described in the within-mentioned Indenture.
XXXXXXXXXX, not in its individual
capacity, but solely as Trustee
By: /s/ XXXXXXXXXX
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XXXXXXXXXX,
Assistant Secretary
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