Pricing Agreement
EXHIBIT 1.1.1
EXECUTION VERSION
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
U.S. Bancorp Investments, Inc.
Xxxxx Fargo Securities, LLC
As Representatives of the several
Underwriters named in Schedule I hereto.
July 18, 2013
Ladies and Gentlemen:
The Kroger Co., an Ohio corporation (the “Company”), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated July 18, 2013 (the “Underwriting Agreement”), to issue and sell to the Underwriters named in Schedule I hereto (the “Underwriters”) the Securities (the “Designated Securities”) specified in Schedule II hereto. 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 Pricing 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 as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or 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 relating to the Designated Securities. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of each of the Underwriters of the Designated Securities pursuant to Section 13 of the Underwriting Agreement and the address of the Representatives referred to in such Section 13 are set forth at the end of Schedule II hereto.
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 the purchase price to the Underwriters, and under other terms and conditions set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto.
The Company understands that the Underwriters intend to make a public offering of the Securities as soon after the effectiveness of this Pricing Agreement as in the judgment of the Representatives is advisable, and initially to offer the Securities on the terms set forth in the Time of Sale Information and the Prospectus. Schedule III hereto sets forth the Time of Sale Information made available at the Time of Sale.
If the foregoing is in accordance with your understanding, please sign and return to us three 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 each of the Underwriters and the Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof.
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Very Truly Yours, | ||
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THE KROGER CO. | ||
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By: |
/s/ Xxxx X. Xxxxxxx | |
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Name: |
Xxxx X. Xxxxxxx |
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Title: |
Executive Vice President |
[Signature Page to Pricing Agreement]
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
U.S. Bancorp Investments, Inc.
Xxxxx Fargo Securities, LLC
and the additional Underwriters named on Schedule I to this Pricing Agreement
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By: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx |
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Incorporated |
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By: |
/s/ Xxxxx X. Xxxxxxx |
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Name: |
Xxxxx X. Xxxxxxx |
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Title: |
Managing Director |
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By: |
U.S. Bancorp Investments, Inc. |
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By: |
/s/ Xxxxx Xxxxxxxx |
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Name: |
Xxxxx Xxxxxxxx |
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Title: |
Managing Director |
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By: |
Xxxxx Fargo Securities, LLC |
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By: |
/s/ Xxxxxxx Xxxxxx |
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Name: |
Xxxxxxx Xxxxxx |
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Title: |
Director |
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On behalf of each of the Underwriters
[Signature Page to Pricing Agreement]
SCHEDULE I
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Underwriter |
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Principal Amount of |
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Principal Amount of |
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Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx |
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$ |
90,000,000 |
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$ |
60,000,000 |
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U.S. Bancorp Investments, Inc. |
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90,000,000 |
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60,000,000 |
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Xxxxx Fargo Securities, LLC |
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90,000,000 |
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60,000,000 |
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Citigroup Global Markets Inc. |
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60,000,000 |
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40,000,000 |
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RBS Securities Inc. |
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60,000,000 |
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40,000,000 |
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Fifth Third Securities, Inc. |
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45,000,000 |
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30,000,000 |
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BNY Mellon Capital Markets, LLC |
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36,000,000 |
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24,000,000 |
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Mitsubishi UFJ Securities (USA), Inc. |
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36,000,000 |
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24,000,000 |
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RBC Capital Markets, LLC |
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36,000,000 |
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24,000,000 |
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PNC Capital Markets LLC |
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27,000,000 |
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18,000,000 |
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CastleOak Securities, L.P. |
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15,000,000 |
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10,000,000 |
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Xxxxxx Xxxxxxxx, LLC |
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15,000,000 |
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10,000,000 |
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Total |
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$ |
600,000,000.00 |
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$ |
400,000,000.00 |
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SCHEDULE II
Title of Designated Securities:
3.85% Senior Notes due 2023
5.15% Senior Notes due 2043
Aggregate Principal Amount:
$600,000,000 of 3.85% Senior Notes due 2023
$400,000,000 of 5.15% Senior Notes due 2043
Price to Public:
99.958% of the principal amount of the 3.85% Senior Notes due 2023, plus accrued interest from July 25, 2013
99.665% of the principal amount of the 5.15% Senior Notes due 2043, plus accrued interest from July 25, 2013
Purchase Price by Underwriters:
99.308% of the principal amount of the 3.85% Senior Notes due 2023, plus accrued interest from July 25, 2013
98.790% of the principal amount of the 5.15% Senior Notes due 2043, plus accrued interest from July 25, 2013
Specified Funds for Payment of Purchase Price:
Immediately available funds
Indenture:
Indenture dated as of June 25, 1999, between the Company and Firstar Bank, National Association, as Trustee, as supplemented by the First Supplemental Indenture, dated June 25, 1999, the Second Supplemental Indenture, dated June 25, 1999, the Third Supplemental Indenture, dated June 25, 1999, the Fourth Supplemental Indenture, dated September 22, 1999, the Fifth Supplemental Indenture, dated September 22, 1999, the Sixth Supplemental Indenture, dated September 22, 1999, the Seventh Supplemental Indenture, dated February 11, 2000, the Eighth Supplemental Indenture, dated February 11, 2000, the Ninth Supplemental Indenture, dated August 21, 2000, the Tenth Supplemental Indenture, dated May 11, 2001, the Eleventh Supplemental Indenture, dated May 11, 2001, the Twelfth Supplemental Indenture, dated August 16, 2001, the Thirteenth Supplemental Indenture, dated April 3, 2002, the Fourteenth Supplemental Indenture dated June 17, 2002, the Fifteenth Supplemental Indenture dated January 28, 2003, the Sixteenth Supplemental Indenture dated
December 20, 2004, the Seventeenth Supplemental Indenture dated August 15, 2007, the Eighteenth Supplemental Indenture dated January 16, 2008, the Nineteenth Supplemental Indenture dated March 27, 2008, the Twentieth Supplemental Indenture dated March 27, 2008, the Twenty-First Supplemental Indenture dated November 25, 2008, the Twenty-Second Supplemental Indenture dated October 1, 2009, the Twenty-Third Supplemental Indenture dated July 13, 2010, the Twenty-Fourth Supplemental Indenture dated January 19, 2012, the Twenty-Fifth Supplemental Indenture dated April 16, 2012, the Twenty-Sixth Supplemental Indenture dated April 16, 2012, the Twenty-Seventh Supplemental Indenture to be dated July 25, 2013 and the Twenty-Eighth Supplemental Indenture to be dated July 25, 2013.
Maturity:
The 3.85% Senior Notes due 2023 will mature on August 1, 2023
The 5.15% Senior Notes due 2043 will mature on August 1, 2043
Interest Rates:
The 3.85% Senior Notes due 2023 will bear interest from July 25, 2013 at 3.85%
The 5.15% Senior Notes due 2043 will bear interest from July 25, 2013 at 5.15%
Interest Payment Dates:
Interest on the 3.85% Senior Notes due 2023 is payable semiannually on February 1 and August 1 of each year commencing on February 1, 2014
Interest on the 5.15% Senior Notes due 2043 is payable semiannually on February 1 and August 1 of each year commencing on February 1, 2014
Redemption Provisions:
As described in the term sheet dated July 18, 2013 included on Schedule IV
Change of Control Put:
As described in the preliminary prospectus supplement dated July 18, 2013
Sinking Fund Provision:
No sinking fund provisions
Defeasance Provisions:
As described in the preliminary prospectus supplement dated July 18, 2013
Guarantees:
None
Time of Delivery:
July 25, 2013
Closing Location:
Offices of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx LLP
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Name and Address of Representatives:
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
00 Xxxxxxxxxxx Xxxxx
XX0-000-00-00
Xxx Xxxx, XX 00000
Attention: High Grade Transaction Management/Legal
U.S. Bancorp Investments, Inc.
000 X. Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: High Grade Fixed Income Syndicate
Xxxxx Fargo Securities, LLC
000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Transaction Management
Schedule III
Time of Sale Information
1. Preliminary Prospectus Supplement, dated July 18, 2013, including the base prospectus included therein, dated December 15, 2010
2. Term sheet, dated July 18, 2013, included on Schedule IV
Schedule IV
The Kroger Co.
Pricing Term Sheet
Dated July 18, 2013
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Issuer: |
The Kroger Co. |
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Trade Date: |
July 18, 2013 |
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Settlement Date: |
July 25, 2013 (T+5) |
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Denominations: |
$2,000 x $1,000 |
3.850% Notes due 2023
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Principal Amount: |
$600,000,000 |
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Security Type: |
Senior Notes |
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Maturity: |
August 1, 2023 |
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Coupon: |
3.850% |
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Price to Public: |
99.958% |
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Yield to Maturity: |
3.855% |
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Spread to Benchmark Treasury: |
T + 132.5 bps |
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Benchmark Treasury: |
UST 1.750% due May 15, 2023 |
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Benchmark Treasury Spot and Yield: |
93-8 and 2.530% |
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Interest Payment Dates: |
February 1 and August 1, commencing February 1, 2014 |
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Make-Whole Call: |
Treasury Rate plus 20 basis points (prior to May 1, 2023) |
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Par Call: |
On or after May 1, 2023 (three months prior to maturity) |
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CUSIP/ISIN: |
501044 CS8/ US501044CS84 |
5.150% Notes due 2043
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Principal Amount: |
$400,000,000 |
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Security Type: |
Senior Notes |
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Maturity: |
August 1, 2043 |
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Coupon: |
5.150% |
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Price to Public: |
99.665% |
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Yield to Maturity: |
5.172% |
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Spread to Benchmark Treasury: |
T + 155 bps |
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Benchmark Treasury: |
UST 3.125% due February 15, 2043 |
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Benchmark Treasury Spot and Yield: |
91-00+ and 3.622% |
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Interest Payment Dates: |
February 1 and August 1, commencing February 1, 2014 |
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Make-Whole Call: |
Treasury Rate plus 25 basis points (prior to February 1, 2043) |
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Par Call: |
On or after February 1, 2043 (six months prior to maturity) |
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CUSIP/ISIN: |
501044 CT6 / US501044CT67
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Joint Bookrunners: |
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated U.S. Bancorp Investments, Inc. |
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Co-Managers: |
Xxxxx Fargo Securities, LLC Citigroup Global Markets Inc. RBS Securities Inc. Fifth Third Securities, Inc. BNY Mellon Capital Markets, LLC Mitsubishi UFJ Securities (USA), Inc. RBC Capital Markets, LLC PNC Capital Markets LLC CastleOak Securities, L.P. Xxxxxx Xxxxxxxx, LLC |
The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting XXXXX on the SEC Web site at xxx.xxx.xxx. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated toll-free at 1-800-294-1322, U.S. Bancorp Investments, Inc. toll-free at 0-000-000-0000 or Xxxxx Fargo Securities, LLC toll-free at 0-000-000-0000.
We expect that delivery of the notes will be made against payment therefore on or about the settlement date specified above, which will be the fifth business day following the date of this term sheet. Under Rule 15c6-1 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, trades in the secondary market generally are required to settle in three business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade the notes on the date of this term sheet or the next succeeding business day will be required, by virtue of the fact that the notes initially will settle in T+5, to specify an alternate settlement cycle at the time of any such trade to prevent a failed settlement. Purchasers of the notes who wish to trade the notes on the date hereof or the next succeeding business day should consult their own advisor.
Any disclaimer or other notice that may appear below is not applicable to this communication and should be disregarded. Such disclaimer or notice was automatically generated as a result of this communication being sent by Bloomberg or another email system.
