PRICING AGREEMENT
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
As Representatives of the several Underwriters named
in Schedule I hereto
World Financial Center
Xxxxx Xxxxx
Xxx Xxxx, XX 00000
February 26, 1998
Dear Sirs:
Sears Xxxxxxx Acceptance Corp., a Delaware corporation (the
"Company"), proposes subject to the terms and conditions stated herein and in
the Underwriting Agreement, dated September 18, 1997 (the "Underwriting
Agreement"), executed between the Company and Sears, Xxxxxxx and Co.
("Sears"), on the one hand, and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated, on the other hand, to issue and sell to the Underwriters named
in Schedule I hereto (the "Underwriters") the Securities specified in
Schedule II hereto (the "Designated Securities"). Each of the provisions of
the Underwriting Agreement is incorporated herein by reference in its
entirety, and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein; and each of
the representations and warranties set forth therein shall be deemed to have
been made at and, except where otherwise specified, as of the date of this
Pricing Agreement, except that each representation and warranty with respect
to the Prospectus in Sections 2 and 3 of the Underwriting Agreement shall be
deemed to be a representation and warranty as of the date of the Underwriting
Agreement in relation to the Prospectus (as therein defined) and also a
representation and warranty as of the date of this Pricing Agreement in
relation to the Prospectus as amended or supplemented. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are used herein
as therein defined.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the time
and place and at a purchase price to the Underwriters set forth in Schedule
II hereto, the principal amount of Designated Securities set forth opposite
the name of such Underwriter in Schedule I hereto, less the principal amount
of Designated Securities covered by Delayed Delivery Contracts, if any, as
may be specified in such Schedule II. The obligations of the Underwriters
hereunder are subject to the condition that Xxxxx & XxXxxxxx, special tax
counsel for the Company, shall have furnished to you their written opinion,
dated the Time of Delivery for the Desginated Securities, as to matters set
forth under "United States Tax Considerations" in the Prospectus Supplement.
If the foregoing is in accordance with your understanding, please
sign and return two counterparts hereof, and upon acceptance hereof by you on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between the Company, Sears
and each of the Underwriters. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in a form of Agreement among Underwriters, the form of which shall be
supplied to the Company upon request. You represent that you are authorized
on behalf of yourselves and on behalf of each of the other Underwriters named
in Schedule I hereto to enter into this Agreement.
Very truly yours,
SEARS XXXXXXX ACCEPTANCE CORP.
By: /S/Xxxxxx X. Xxxxx
SEARS, XXXXXXX AND CO.
By: /S/Xxxxx X. Xxxxxxx
Accepted as of the date hereof:
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
As Representative of the several Underwriters
By: /S/Xxxxx Xxxxxxxx
Managing Director
SCHEDULE I
Underwriter Principal Amount of Designated
Securities to be purchased
Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated $ 75,312,500
Xxxxxx Xxxxxxx & Co. Incorporated 75,312,500
Xxxxx Xxxxxx Inc. 75,312,500
Bear, Xxxxxxx & Co. Inc. 3,437,500
CIBC Xxxxxxxxxxx Corp. 3,437,500
Xxxx Xxxxxxxx Incorporated 3,437,500
X.X. Xxxxxxx & Sons, Inc. 3,437,500
Xxxxx Xxxxxxx Inc. 3,437,500
Xxxxxx Xxxxxxx Incorporated 3,437,500
US Clearing Corp. 3,437,500
Total $250,000,000
SCHEDULE II
Title of Designated Securities:
7% Notes due March 1, 2038
Aggregate principal amount:
$250,000,000
Price to Public:
100.00% of the principal amount of
the Designated Securities, plus accrued
interest from March 3, 1998 to the Time of
Delivery
Purchase Price by Underwriters:
96.85% of the principal amount of the
Designated Securities, plus accrued
interest from March 3, 1998 to the Time of
Delivery
Indenture:
Indenture, dated as of May 15, 1995,
between the Company and The Chase Manhattan
Bank, N.A., as Trustee
Maturity:1
Interest Rate:1
Interest Payment dates:1
Redemption Provisions: 1
Sinking Fund Provisions:
None
Time of Delivery:
9:00 A.M., Chicago time, March 3, 1998
Funds in which payment by Underwriters to Company to be made:
Same day funds
Method of Payment:
Wire transfer to The Chase Manhattan Bank, for the Account of Sears
Xxxxxxx Acceptance
Corp., Account No. 910-0000000, ABA No. 000000000
Closing Location:
Chicago, Illinois and Delaware
Delayed Delivery:
None
Counsel:
To the Company and Sears, Xxxxx X. Xxxxxx, Assistant General
Counsel-Corporate & Securities,
Sears, Xxxxxxx and Co.
Xxxxxx & Xxxxxxx
To the Underwriters, Cleary, Gottlieb, Xxxxx & Xxxxxxxx
FORM OF NOTE
[FORM OF FACE OF NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS MADE TO
CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Number $
CUSIP NO.__________________
SEARS XXXXXXX ACCEPTANCE CORP.
7% Note due March 1, 2038
7% 7%
Due 2038 Due 2038
Sears Xxxxxxx Acceptance Corp., a corporation organized and existing
under the laws of the State of Delaware (hereinafter called the "Company"),
for value received, hereby promises to pay to , or
registered assigns, the principal sum of _____________________________ upon
presentation and surrender of this Note, on the first day of March, 2038, at
the office or agency of the Company in the Borough of Manhattan of The City
of New York or, at the option of the holder hereof, such office or agency, if
any, maintained by the Company in the city in which the principal executive
offices of the Company are located or the city in which the principal
corporate trust office of the Trustee is located, in such coin or currency of
the United States of America as at the time of payment is legal tender for
public and private debts, and to pay interest on said principal sum at the
rate of 7% per annum, either, at the option of the Company, by check mailed
to the address of the person entitled thereto as such address shall appear on
the Security Register or at either of such offices or agencies, in like coin
or currency, from the March 1, June 1, September 1 or December 1, as the case
may be, next preceding the date hereof to which interest has been paid on the
Notes referred to on the reverse hereof (unless the date hereof is the date
to which interest has been paid on such Notes, in which case from the date
hereof, or unless the date hereof is prior to June 1, 1998, in which case
from March 3, 1998), quarterly, commencing on June 1, 1998, on March 1, June
1, September 1, and December 1, until payment of said principal sum has been
made or duly provided for. Notwithstanding the foregoing, if this Note is
dated after any February 14 (February 15 in the case of any Leap Year) and
before the following March 1, or after any May 17 and before the following
June 1, or after any August 17 and before the following September 1, or after
any November 16 and before the following December 1, then this Note shall
bear interest from such following March 1, June 1, September 1 or December 1,
as applicable, provided, however, that if the Company shall default in the
payment of interest due on such following March 1, June 1, September 1 or
December 1, this Note shall bear interest from the next preceding March 1,
June 1, September 1 or December 1 to which interest has been paid on such
Note, or if no interest has been paid on such Note, then from March 3, 1998.
The interest so payable on any March 1, June 1, September 1 or December 1,
will, subject to certain exceptions provided in the Indenture referred to on
the reverse hereof, be paid to the person in whose name this Note is
registered at the close of business on the February 14 (February 15 in the
case of any Leap Year) prior to such March 1, the May 17 prior to such June
1, the August 17 prior to such September 1, or the November 16 prior to such
December 1. Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the registered holder on such Interest
Payment Date, and may be paid to the Person in whose name this Note is
registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice of which shall
be given to Noteholders not less than 10 days prior to such Special Record
Date, or may be paid, at any time in any other lawful manner, all as more
fully provided in such Indenture.
This Note is subject to redemption, at the option of the Company, on
each March 1, June 1, September 1 and December 1, commencing on March 1,
2003, as a whole or from time to time in part, upon not less than 30 nor more
than 60 days' notice, at a redemption price equal to 100% of the principal
amount redeemed plus accrued and unpaid interest to the date fixed for
redemption. In addition, this Note is subject to redemption, at the option
of the Company, in whole but not in part, at any time upon not less than 30
nor more than 60 days' notice, at a redemption price equal to 100% of the
principal amount redeemed plus accrued and unpaid interest to the date fixed
for redemption, if there is a substantial likelihood that the Company will
not be entitled to deduct currently for United States federal income tax
purposes the full amount of interest accrued in respect of the Note as a
result of any of the following occurring, becoming effective or being issued
after March 2, 1998:
(i) any actual or proposed change in or amendment to the laws ( or any
regulations or rulings promulgated thereunder) of the United States , or any
change in the application, official interpretation or enforcement of such
laws, regulations or rulings;
(ii) any action taken by a taxing authority which action is generally
applied or is taken with respect to the Company;
(iii) a decision rendered by a court of competent jurisdiction in the
United States, whether or not such decision was rendered with respect to the
Company; or
(iv) a technical advice memorandum or letter ruling or other
administrative pronouncement issued by the National Office of the United
States Internal Revenue Service, on substantially the same facts as those
pertaining to the Company.
If any Interest Payment Date or the Maturity Date falls on a day that
is not a Business Day, the interest or principal payment shall be made on the
next day that is a Business Day, and no interest on such payments shall
accrue for the period from and after the Interest Payment Date or the
Maturity Date. Interest on the Note well be computed on the basis of a
360-day year of twelve 30-day months.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, and such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
This Note shall not be entitled to any benefit under the Indenture
referred to on the reverse hereof or any indenture supplemental thereto, or
become valid or obligatory for any purpose, until the certificate of
authentication hereon shall have been signed by or on behalf of the Trustee
under such Indenture.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: March 3, 1998
Sears Xxxxxxx Acceptance Corp.
By _______________________________
President
By ___________________________
Secretary
[Corporate Seal]
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities of the series designated and referred to
in the within-mentioned Indenture.
The Chase Manhattan Bank
as Trustee
By:___________________________________
Authorized Officer
[FORM OF REVERSE SIDE OF NOTE]
SEARS XXXXXXX ACCEPTANCE CORP.
7% Note due March 1, 2038
1. This Note is one of a duly authorized issue of debentures, notes,
bonds or other evidences of indebtedness of the Company (hereinafter called
the "Securities") of the series hereinafter specified, unlimited in aggregate
principal amount, all issued or to be issued under or pursuant to an
indenture dated as of May 15, 1995, executed between the Company and THE
CHASE MANHATTAN BANK, as Trustee; to which indenture and all indentures
supplemental thereto (herein collectively called the "Indenture") reference
is hereby made for a specification of the rights and limitation of rights
thereunder of the Holders of the Securities, the rights and obligations
thereunder of the Company and the rights, duties and immunities thereunder of
the Trustee. The Securities may be issued in one or more series, which
different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest (if any) at different rates, may
be subject to different redemption provisions (if any), may be subject to
different sinking, purchase or analogous funds (if any), may be subject to
different covenants and Events of Default and may otherwise vary as in the
Indenture provided. This Note is one of a series designated as the "7% Notes
due March 1, 2038" of the Company, limited in aggregate principal amount to
$250,000,000 (hereinafter referred to as the "Notes"). All terms used in
this Note which are defined in the Indenture shall have the meanings assigned
to them in the Indenture.
2. In case a default, as defined in the Indenture, shall occur and
be continuing with respect to the Notes, the principal amount of all Notes
then outstanding under the Indenture may be declared or may become due and
payable upon the conditions and in the manner and with the effect provided in
the Indenture. The Indenture provides that such declaration may in certain
events be annulled by the Holders of a majority in principal amount of the
Notes outstanding.
3. To the extent permitted by, and as provided in, the Indenture,
indentures supplemental thereto may be entered into with the consent of the
Company and with the consent of the Holders of not less than a majority in
principal amount of the outstanding Securities (as defined in the Indenture)
of each series to be affected; provided, however, that no such supplemental
indenture shall (i) change the Stated Maturity of the principal of (and
premium, if any, on), or the interest on, any Security, or reduce the
principal amount of (and premium, if any, on), or the rate of interest on any
Security, or change the Currency in which the principal of (and premium, if
any) or interest on such Securities is denominated or payable, or reduce the
amount of the principal of an Original Issue Discount Security that would be
payable upon a declaration of acceleration of the Maturity thereof pursuant
to Section 6.1 of the Indenture without the consent of the Holder of each
outstanding Security so affected, or (ii) reduce the aforesaid percentage of
Securities of any series the Holders of which are required to consent to any
such supplemental indenture, without the consent of the Holders of each
outstanding Security affected thereby.
4. The Indenture also provides that the Holders of a majority in
principal amount of the Securities of any series then outstanding may waive
any past default under the Indenture and its consequences, except a default
in the payment of the principal of or interest or premium, if any, on any of
the Securities.
5. No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and interest on
this Note at the place, at the respective times, at the rate, and in the
Currency, herein prescribed.
6. This Note is transferable by the registered Holder hereof or by
his attorney duly authorized in writing at the office or agency of the
Company in the Borough of Manhattan of The City of New York or, at the option
of the Holder hereof, such office or agency, if any, maintained by the
Company in the city in which the principal executive offices of the Company
are located or the city in which the principal corporate trust office of the
Trustee is located, without charge except for any tax or other governmental
charge imposed in relation thereto, but only in the manner and subject to the
limitations provided in the Indenture and upon surrender of this Note. Upon
any such transfer a Note or Notes of authorized denominations for a like
aggregate principal amount and bearing a number not contemporaneously
outstanding will be issued in exchange herefor.
7. The Notes are issuable only as registered Notes without coupons,
in denominations of $25 and any multiple of $25. In the manner and subject
to the limitations provided in the Indenture, Notes are exchangeable, without
charge except for any tax or other governmental charge imposed in relation
thereto, for other Notes of authorized denominations for a like aggregate
principal amount, at the office or agency of the Company in the Borough of
Manhattan of The City of New York or, at the option of the Holder hereof,
such office or agency, if any, maintained by the Company in the city in which
the principal executive offices of the Company are located or the city in
which the principal corporate trust office of the Trustee is located.
8. The Company, the Trustee, any Authenticating Agent, any paying
agent and any Security registrar may deem and treat the registered Holder
hereof as the absolute owner hereof (whether or not this Note shall be
overdue and notwithstanding any notation of ownership or other writing hereon
by anyone other than the Company or any Security registrar) for the purpose
of receiving payment of or on account of the principal hereof and interest
hereon and for all other purposes, and neither the Company, the Trustee, an
Authenticating Agent, a paying agent nor Security registrar shall be affected
by any notice to the contrary. All such payments shall be valid and
effectual to satisfy and discharge the liability upon this Note to the extent
of the sum or sums so paid.
9. No recourse shall be had for the payment of the principal of or
the interest on this Note or for any claim based hereon or otherwise in any
manner in respect hereof, or in respect of the Indenture, against any
incorporator, shareholder, officer or director, past, present or future, of
the Company or of any predecessor or successor corporation, whether by virtue
of any constitutional provision or statute or rule of law, or by the
enforcement of any assessment or penalty or in any other manner, all such
liability being expressly waived and released by the acceptance hereof and as
part of the consideration for the issue hereof. In the event of any sale or
transfer of its assets and liabilities substantially as an entirety to a
successor corporation, the predecessor corporation may be dissolved and
liquidated as more fully set forth in the Indenture.
1 Incorporated by reference to attached form of security.
