FORM OF FACE OF SECURITY
PRICE/COSTCO, INC.
[ ]% SENIOR NOTES DUE 2001
No. ________ $ _________
CUSIP No. _________
Price/Costco, Inc., a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company," which term
includes any successor Person under the Indenture hereinafter referred to),
for value received, hereby promises to pay to _____________, or registered
assigns, the principal sum of ____________ Dollars on March [ ], 2001, and to
pay interest thereon from [ ] or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, semiannually on March
[ ] and September [ ] of each year, commencing September [ ], 1996, at the
rate of [ ]% per annum, until the principal hereof is paid or made available
for payment. The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in such Indenture, be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest which shall be September 1 or March 1 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Interest will be computed on the basis of a 360-day year comprised of twelve
30-day months. Any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or
more Predecessor Securities) 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 whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may
be required by such exchange, all as more fully provided in said Indenture.
Payment of the principal of and interest on this Security will be made at the
office or agency of the Company maintained for that purpose in New York, New
York or St. Paul, Minnesota, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; PROVIDED, however, that at the option of the Company payment
of interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Securities Register.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by MANUAL signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Price/Costco, Inc.
By:
-----------------------------------------
President and Chief Executive Officer
Attest:
Chairman of the Board
FORM OF REVERSE OF SECURITY
This Security is one of a duly authorized issue of Securities of the
Company designated as its [ ]% Senior Notes Due 2001 (herein called the
"Securities"), limited in aggregate principal amount to $ , issued
under an Indenture, dated as of March [ ], 1996 (herein called the
"Indenture"), between the Company and American Bank National Association, as
Trustee (herein called the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Securities and of the terms
upon which the Securities are, and are to be, authenticated and delivered.
The Securities are not subject to redemption, whether at the option of
the Company or otherwise.
The Indenture imposes certain limitations on the ability of the Company
and its Restricted Subsidiaries to, among other things, incur Liens, enter
into sale and leaseback transactions and merge, consolidate or convey,
transfer or lease its properties and assets substantially as an entirety.
The limitations are subject to a number of important qualifications and
exceptions.
If an Event of Default shall occur and be continuing, the principal of
all the Securities may be declared due and payable in the manner and with the
effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment hereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of
a majority in aggregate principal amount of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders
of the majority in aggregate principal amount of the Securities at the time
Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration or transfer hereof or in exchange
hereof or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.
No reference herein to the Indenture and no provision of this Security
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 Security as provided in the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registerable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in New York, New York or St. Paul, Minnesota,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Securities Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Securities, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in
the Indenture and subject to certain limitations therein set forth, the
Securities are exchangeable for a like aggregate principal amount of
Securities of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to
the contrary.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to
be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
[FORM OF ASSIGNMENT]
I or we assign this Security to
_____________________________________________
_____________________________________________
_____________________________________________
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identify number of assignee
____________ and irrevocably appoint _____________ agent to transfer this
Security on the books of the Company. The agent may substitute another to
act for him.
Date: ____________________ Signed: _______________________
(Sign exactly as your name appears on the other side of this Security)
___________________________
Signature guarantee should be made by a guarantor institution participating
in the Securities Transfer Agents Medallion Program or in such other
guarantee program acceptable to the Trustee.