Document:

Exhibit

4.3

 

SUPPLEMENTAL

INDENTURE

RELATING TO

ADDITIONAL GUARANTEES

 

 

SUPPLEMENTAL INDENTURE (this “Supplemental

Indenture”), dated as of December 1, 2002, by and among Best Buy Co., Inc. (the

“Company”), a Minnesota corporation; Best Buy Stores, L.P., a Delaware limited

partnership (the “Existing Guarantor”); BBC Investment Co., a Nevada

corporation and BBC Property Co., a Minnesota corporation (the “Additional

Guarantors” and, together with the Existing Guarantor, the “Guarantors”) and

Wells Fargo Bank Minnesota, National Association, a national banking

association, as trustee (the “Trustee”).

 

WITNESSETH

 

                WHEREAS, the Company and certain of its Subsidiaries

have heretofore executed and delivered to the Trustee an indenture (the

“Indenture”), dated as of June 27, 2001, providing for the issuance of

Convertible Debentures due June 27, 2021 of the Company (the “Securities”).

 

WHEREAS, Section 4.3 and Article XI of the Indenture

provide that under certain circumstances the Company may or must cause certain of

its Subsidiaries to execute and deliver to the Trustee a supplement to the

Indenture pursuant to which such Subsidiaries shall unconditionally guarantee

all of the Company’s Obligations under the Securities pursuant to a Guarantee

on the terms and conditions set forth herein; and

 

WHEREAS, the Additional Guarantors are obligated with

respect to Indebtedness under one of the Company’s Credit Facilities and

therefore, are obligated to provide Guarantees of the Company’s Obligations

under the Securities and the Indenture; and

 

WHEREAS, pursuant to Section 9.1 of the Indenture, the

Trustee is authorized to execute and deliver this Supplemental Indenture.

 

                NOW THEREFORE, in

consideration of the foregoing and for other good and valuable consideration,

the receipt of which is hereby acknowledged, the Company, the Additional

Guarantors and the Trustee mutually covenant and agree for the equal and

ratable benefit of the Holders of the Securities as follows:

 

                1.             Capitalized Terms.  Capitalized terms used herein without

definition shall have the meanings assigned to them in the Indenture.

 

                2.             Agreement to Guarantee.  The Additional Guarantors hereby agree,

jointly and severally with the Existing Guarantor, to unconditionally guarantee

the Company’s Obligations under the Securities and the Indenture on the terms

and subject to the conditions set forth in Article XI of the Indenture and to

be bound by all other applicable provisions of the Indenture and the

Securities.  The Additional Guarantors

hereby agree that their

 

 

Guarantees shall remain in full force and effect notwithstanding any

failure to endorse on each Security a notation of such Guarantees.  These Guarantees are subject to release as

and to the extent provided in Section 11.4 of the Indenture.  These Guarantees shall remain in full force

and effect irrespective of the release of the Guarantees of any Guarantor other

than the Additional Guarantors as provided in Section 11.4 of the Indenture.

 

3.             No

Recourse Against Others.  No past,

present or future director, officer, employee, incorporator, partner, member,

shareholder or agent of any Guarantor, as such, shall have any liability for

any obligations of the Company or any Guarantor under the Securities, any

Guarantee, the Indenture or this Supplemental Indenture or for any claim based

on, in respect of, or by reason of, such obligations.  Each Holder by accepting a Security waives and releases all such

liability.  Such waiver and release form

a part of the consideration for issuance of the Securities and the Guarantees.

 

4.             Governing

Law.  This Supplemental Indenture

shall be governed by and construed in accordance with the laws of the State of

New York.

 

5.             Counterparts.  The parties may sign any number of copies of

this Supplemental Indenture.  Each signed

copy shall be an original, but all of them together represent the same

agreement.

 

6.             Effect

of Headings.  The Section headings

herein are for convenience only and shall not affect the construction hereof.

 

7.             Trustee.  The Trustee shall not be responsible in any

manner whatsoever for or in respect of the validity or sufficiency of this

Supplemental Indenture or for or in respect of the correctness of the recitals

of fact contained herein, all of which recitals are made by the Company and the

Guarantors.

 

IN WITNESS

WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly

executed as of the date first above written.

 

	

   

  	

  BBC INVESTMENT

  CO.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Ryan D.

  Robinson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Ryan D. Robinson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Vice President 

  Finance & Treasurer

  	

   

  
							

 

2

 

	

   

  	

  BBC PROPERTY CO.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Ryan D.

  Robinson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Ryan D. Robinson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Vice President — Finance & Treasurer

  	

   

  
	

   

  
	

   

  
	

   

  	

  BEST BUY CO.,

  INC.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Ryan D.

  Robinson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Ryan D. Robinson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Vice President — Finance & Treasurer 

  	

   

  
	

   

  
	

   

  
	

   

  	

  BEST BUY STORES,

  L.P.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  BBC PROPERTY

  CO., its General Partner

  	

   

  
	

   

  
	

   

  
	

   

  	

  By:

  	

  /s/ Ryan

  D.Robinson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Ryan D. Robinson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Vice President — Finance & Treasurer

  	

   

  
	

   

  
	

   

  
	

   

  	

  WELLS FARGO BANK

  MINNESOTA, NATIONAL ASSOCIATION, as Trustee

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Michael T.

  Lechner

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Michael T. Lechner

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  ASSISTANT VICE PRESIDENT

  	

   

  
	

   

  
							

 

 

3

 

SUPPLEMENTAL INDENTURE

 

RELATING TO

RELEASE OF GUARANTORS

 

 

THIS

SUPPLEMENTAL INDENTURE, dated as of December 3, 2001, by and among Best Buy

Co., Inc. (the “Company”), a corporation duly organized and existing under the

laws of the State of Minnesota, certain of the Company’s subsidiaries, as

“Guarantors” under the Indenture referred to below (collectively, the “Existing

Guarantors”), and Wells Fargo Bank Minnesota, National Association, a national

banking association, as trustee (the “Trustee”).

 

RECITALS

 

                                The

Company, the Existing Guarantors and the Trustee are parties to an Indenture

dated as of June 27, 2001, (the “Indenture”) providing for the issuance of the

Company’s Convertible Debentures due June 27, 2021 (the “Securities”).

 

                                Pursuant to the terms of the

Indenture, the Board of Directors may designate certain of its subsidiaries as

“Unrestricted Subsidiaries” (as defined in the Indenture) for the purpose of

releasing such subsidiaries as Guarantors of the Company’s obligations under the

Indenture and under the Securities.

 

                                Section 11.4(e) of the Indenture

provides that the Trustee is authorized to execute any documents reasonably

required in order to evidence the release of any Guarantors from their

obligations under the Indenture and under the Securities.

 

                                NOW THEREFORE, in consideration of

the foregoing and for other good and valuable consideration, the receipt of

which is hereby acknowledged, the Company, the Existing Guarantors and the

Trustee mutually covenant and agree as follows:

 

                1.             Capitalized

Terms.  Capitalized terms used

herein without definition shall have the meanings assigned to them in the

Indenture.

 

                2.             Officers’

Certificate; Board Resolution.  The

Trustee acknowledges receipt of the Officers’ Certificate required by Section

11.4(e) of the Indenture and a Secretary’s Certificate evidencing resolutions

of the Company’s Board of Directors designating certain of the Company’s

subsidiaries as Unrestricted Subsidiaries.

 

                3.             Release

of Guarantors.  Pursuant to Sections

1.1 and 11.4 of the Indenture, the following subsidiaries of the Company, as

Unrestricted Subsidiaries, have been released from their obligations under the

Indenture, the Securities and their respective Guarantees:

 

•              BBC

Insurance Agency, Inc.;

•              BBC

Investment Co.;

•              BBC

Property Co.;

•              Best

Buy Purchasing LLC;

 

4

 

•              BestBuy.Com,

Inc.;

•              Best

Buy Concepts, Inc.;

•              Magnolia

Hi-Fi, Inc.;

•              Musicland

Stores Corporation;

•              The

Musicland Group, Inc.;

•              Media

Play, Inc.;

•              MG

Financing Services, Inc.;

•              MLG

Internet, Inc.;

•              Musicland

Retail, Inc.;

•              On

Cue, Inc.;

•              Request

Media, Inc.;

•              Suncoast

Group, Inc.;

•              Suncoast

Motion Picture Company, Inc.;

•              Suncoast

Retail, Inc.;

•              TMG

Caribbean, Inc.;

•              TMG-Virgin

Islands, Inc.; and

•              Redline

Entertainment, Inc.

 

                4.             Continuance

of Guarantees.  The Company and Best

Buy Stores, L.P. acknowledge that their Guarantees shall remain in full force

and effect irrespective of the release of the other Existing Guarantors.

 

                5.             Governing

Law.  This Supplemental Indenture

shall be governed by and construed in accordance with the laws of the State of

New York.

 

                6.             Trustee.  The Trustee shall not be responsible in any

manner whatsoever for or in respect of the validity or sufficiency of this

Supplemental Indenture or for or in respect of the correctness of the recitals

of fact contained herein, all of which recitals are made by the Company and the

Guarantors.

 

                7.             Counterparts.  The parties may sign any number of copies of

this Supplemental Indenture.  Each

signed copy shall be an original, but all of them together represent the same

agreement.

 

                IN WITNESS WHEREOF, the parties hereto have caused

this Supplemental Indenture to be duly executed as of the date first above

written.

 

	

   

  	

  BEST BUY CO.,

  INC.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance,

  Treasurer and Chief Financial Officer

  	

   

  
							

 

 

5

 

	

   

  	

  BBC INSURANCE

  AGENCY, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance,

  Treasurer and Chief Financial Officer

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  BBC INVESTMENT

  CO.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance and Treasurer

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  BBC PROPERTY CO.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance and Treasurer

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  BEST BUY STORES,

  L.P.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  BBC PROPERTY

  CO., its General Partner

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
							

 

 

6

 

	

   

  	

  BEST BUY

  PURCHASING LLC

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  BESTBUY.COM,

  INC.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance, Treasurer

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  BEST BUY CONCEPTS,

  INC.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance, Treasurer

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MAGNOLIA HI-FI,

  INC.

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President and Secretary

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MUSICLAND STORES

  CORPORATION

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
							

 

 

7

 

	

   

  	

  THE MUSICLAND

  GROUP, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MEDIA PLAY, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MG FINANCING

  SERVICES, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MLG INTERNET,

  INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  MUSICLAND

  RETAIL, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
							

 

 

8

 

	

   

  	

  ON CUE, INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  REQUEST MEDIA,

  INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  SUNCOAST GROUP,

  INC.

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  SUNCOAST MOTION

  PICTURE COMPANY, INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  SUNCOAST RETAIL,

  INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M. Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
							

 

 

9

 

	

   

  	

  TMG CARIBBEAN,

  INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  TMG-VIRGIN

  ISLANDS, INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Joseph M.

  Joyce

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Joseph M. Joyce

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

  REDLINE

  ENTERTAINMENT, INC.

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Darren R.

  Jackson

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Darren R. Jackson

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President - Finance,

  Treasurer

  	

   

  
							

 

 

10

 

	

   

  	

  WELLS FARGO BANK

  MINNESOTA,

  NATIONAL ASSOCIATION, as Trustee

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Michael T.

  Lechner

  	

   

  
	

   

  	

   

  	

  Name:

  	

  Michael T. Lechner

  	

   

  	

   

  
	

   

  	

   

  	

  Title:

  	

  Corporate Trust Officer

  	

   

  
							

 

 

11Exhibit

10.2

 

BEST BUY CO., INC.

 

1997

EMPLOYEE NON–QUALIFIED

STOCK OPTION PLAN

 

2003 AMENDMENT AND RESTATEMENT

 

A.                                    Purpose.

 

                The purpose of

this Employee Non-Qualified Stock Option Plan (“Plan”) is to further the growth

and general prosperity of Best Buy Co., Inc. (the “Company”), and its directly

and indirectly wholly-owned subsidiaries (collectively, the “Companies”) by

enabling current key employees of the Companies, who have been or will be given

responsibility for the administration of the affairs of the Companies and upon

whose judgment, initiative and effort the Companies were or are largely

dependent for the successful conduct of their business, to acquire shares of

the common stock of the Company under the terms and conditions and in the

manner contemplated by this Plan, thereby increasing their personal involvement

in the Companies and enabling the Companies to obtain and retain the services

of such employees.  Options granted

under the Plan are intended to be options which do not meet the requirements of

Section 422A of the Internal Revenue Code of 1986, as amended (the “Code”).

 

B.                                    Administration.

 

                This Plan shall be administered

by the Compensation and Human Resources Committee (the “Committee”) of the

Company’s Board of Directors (the “Board”). 

Options may not be granted to any person while serving on the Committee

unless approved by a majority of the disinterested members of the Board.  Subject to such orders and resolutions not

inconsistent with the provisions of this Plan as may from time to time be

issued or adopted by the Board, the Committee shall have full power and

authority to interpret the Plan and, to the extent contemplated herein, shall

exercise the discretion granted to it regarding participation in the Plan and

the number of shares to be optioned and sold to each participant.

 

                All decisions,

determinations and selections made by the Committee pursuant to the provisions

of the Plan and applicable orders and resolutions of the Board shall be final.

 

C.                                    Eligibility and Participation.

 

                Options may be

granted under the Plan to (i) key executive personnel, including officers,

senior management employees and members of the Board who are employees of any

of the Companies; (ii) staff employees, including managers, supervisors, and

their functional equivalents for: 

warehousing, service, merchandising, leaseholds, installation, and

finance and administration; (iii) line management employees, including retail

store and field managers, supervisors and their functional equivalents; and

(iv) any employee having served the Companies

 

 

continuously for a period of not less than ten (10) years.  The Committee shall grant to such

participants options to purchase shares in such amounts as the Committee shall

from time to time determine.

 

D.                                    Shares Subject to the Plan.

 

                Subject to

adjustment as provided in Section E. herein, an aggregate of 60,000,000 shares

of $0.10 par value common stock of the Company shall be subject to this Plan

from authorized but unissued shares of the Company.  Such number and kind of shares shall be appropriately adjusted in

the event of any one or more stock splits, reverse stock splits or stock

dividends hereafter paid or declared with respect to such stock.  If, prior to the termination of the Plan,

shares issued pursuant hereto shall have been repurchased by the Company

pursuant to this Plan, such repurchased shares shall again become available for

issuance under the Plan.

 

                Any shares which,

after the effective date of this Plan, shall become subject to valid outstanding

options under this Plan may, to the extent of the release of any such shares

from option by termination or expiration of option(s) without valid exercise,

be made the subject of additional options under this Plan.

 

E.                                      Adjustments Upon Changes in Capitalization.

 

                In the event of a

merger, consolidation, reorganization, stock dividend, stock split, or other

change in corporate structure or capitalization affecting the common stock of

the Company, an appropriate adjustment may be made in the number and kind of

shares subject to and the exercise prices of options granted under the Plan as

determined by the Committee.

 

F.                                      Terms and Conditions of Options.

 

                The Committee

shall have the power, subject to the limitations contained in this Plan, to

prescribe any terms and conditions in respect of the granting or exercise of

any option under this Plan and, in particular, shall prescribe the following

terms and conditions:

 

(1)           Each

option shall state the number of shares to which it pertains.

 

(2)           The

price at which shares shall be sold to participants hereunder (the “Exercise

Price”) shall be the Fair Market Value of the Company’s common stock on the

date of grant.  Except as otherwise

provided herein, payment of the Exercise Price shall be made (a) if payment is

made by check payable to the Company, at the time the shares are sold

hereunder, or (b) if payment is made pursuant to an irrevocable election to

surrender outstanding shares of common stock of the Company which have a Fair

Market Value on the date of surrender equal to the Exercise Price of the shares

as to which the option is being exercised, no later than the settlement date

for the shares sold in the market to cover the Exercise Price, or (c) by a

combination thereof, unless an option is exercised in connection with a

deferral election pursuant to the Deferred Compensation Plan, defined below, in

which case payment of the Exercise Price shall be made as provided in Section N

herein.  However, the provisions of

subparts (b) and (c) of this

 

2

 

Section F.(2) shall not be applicable to options granted to directors,

officers or employees of Companies that are resident in Canada within the

meaning of applicable federal or provincial tax laws of that country.

 

(3)           The

vested portion of an option shall be exercisable in whole or in part with

respect to the shares included therein until the earlier of (a) the close of

business on the tenth day prior to the proposed effective date of (i) any

merger or consolidation of the Company with any other corporation or entity as

a result of which the holders of the common stock of the Company will own less

than a majority voting control of the surviving corporation; (ii) any sale of

substantially all of the assets of the Companies or (iii) any sale of common

stock of the Company to a person not a shareholder on the date of issuance of

the option who thereby acquires majority voting control of the Company, subject

to any such transaction actually being consummated, or (b) the close of

business on the date ten (10) years after the date the option was granted.  The Company shall give written notice to the

optionee not less than 30 days prior to the proposed effective date of any of

the transactions described in (a) above.

 

(4)           Except

in the event of disability, death or normal retirement, an option shall be

exercisable with respect to the shares included therein not earlier than the

date one (1) year following the date of grant of the option, nor later than the

date ten (10) years following the date of grant of the option; provided,

however, that during the second through fourth years following the date of

grant, the optionee may exercise such optionee’s right to acquire only twenty–five

percent (25%) of the shares subject to such option together with any shares

that the optionee had previously been able to acquire; and provided further,

however, that in the event of a change in status of an employee from full-time

or part-time to occasional/seasonal, such employee shall continue to have the

right to exercise an option following such change in status but only to the

extent of the shares available for acquisition on the date of such change in

status (the “Change in Status Date”).

 

(5)           Except

as in the event of disability, death or normal retirement, an option may be

exercised only by the optionee while such optionee is, and has continually

been, since the date of the grant of the option, an employee of any of the

Companies; provided, however, that a former employee shall continue to have the

right to exercise an option for a period of thirty (30) days following such

termination to the extent of the shares available for acquisition on the date

of such former employee’s termination but in no event later than the date ten

(10) years after the date of grant of such option.  Such thirty (30) day period commences on the date such optionee

first ceases regular and active employment with any of the Companies.  For greater certainty, a Company may, but

has no obligation to, notify any such optionee as to when they have ceased to

be regularly and actively employed by any of the Companies, and such notice

shall be conclusive evidence of such cessation.  If the continuous employment of an optionee terminates by reason

of disability, death or normal retirement, an option granted hereunder held by

the disabled, deceased or retired employee may be exercised to the extent of

all shares subject to the option (or, with respect to a disabled, deceased or

retired occasional/seasonal employee, to the extent of the shares available for

acquisition on the

 

3

 

Change in Status Date) within one (1) year following the date of

disability or death or five (5) years following the date of normal retirement,

but in no event later than ten (10) years after the date of grant of such

option, by the disabled or retired employee or the person or persons to whom

the deceased employee’s rights under such option shall have passed by will or

by the applicable laws of descent and distribution.  For purposes of this Plan only, (a) an employee shall be deemed

“disabled” if the employee is unable to perform his or her usual duties for the

Companies as a result of physical or mental disability, and such inability to

perform continues or is expected to continue for at least twelve (12)

consecutive months, and (b) “normal retirement” shall mean retirement on or

after age 60 so long as the employee has served the Companies continuously for

at least the three (3) years immediately preceding retirement.  Notwithstanding the foregoing, the changes

made in Sections F(4) and (5) pursuant to the amendments hereto adopted on

April 24, 1998 (relating to the vesting of options in the event of normal

retirement), shall be effective only for options granted hereunder on and after

April 24, 1998.

 

(6)           An

option shall be exercised when notice of such exercise, either in writing or

orally, has been given to the Company at its principal business office or to

its designated agent by the person entitled to exercise the option and full

payment for the shares with respect to which the option is exercised has been

received by the Company.  Until the

stock certificates are issued, no right to vote or receive dividends or any

other rights as a shareholder shall exist with respect to optioned shares,

notwithstanding the exercise of the option.

 

(7)           Each

optionee shall be obligated to comply with all applicable policies of  the Companies, as may be added or amended by

the Companies from time to time, and to 

maintain the confidentiality of all of the confidential and proprietary

information of the Companies.  In the

event of a breach by the optionee of any of such obligations, all of the

optionee’s options granted pursuant to the Plan and all rights thereunder shall

immediately terminate, including without limitation the 30-day grace period

following termination of the optionee’s employment as provided in Section

F(5).  This Section F(7) shall be

effective only for options granted hereunder on and after April 16, 1999..

 

G.                                    Options Not Transferrable.

 

                Options under the

Plan may not be sold, pledged, assigned or transferred in any manner, whether

by operation of law or otherwise except by will or the laws of descent, and may

be exercised during the lifetime of an optionee only by such optionee.

 

H.                                    Amendment or Termination of the Plan.

 

                The Board may

amend this Plan from time to time as it may deem advisable and may at any time

terminate the Plan, provided that any such termination of the Plan shall not

adversely affect options already granted and such options shall remain in full

force and effect as if the Plan had not been terminated.

 

 

4

 

I.                                         Agreement and Representations of Optionees.

 

                As a condition

precedent to the exercise of any option or portion thereof, the Company may

require the person exercising such option to represent and warrant at the time

of any such exercise that the shares are being purchased only for investment

and without any present intention to sell or distribute such shares if, in the

opinion of counsel for the Company, such a representation is required under the

Securities Act of 1933 or any other applicable law, regulation or rule of any

governmental agency.

 

                In the event legal

counsel to the Company renders an opinion to the Company that shares for

options exercised pursuant to this Plan cannot be issued to the optionee

because such action would violate any applicable federal or state securities

laws, then in that event the optionee agrees that the Company shall not be

required to issue said shares to the optionee and shall have no liability to

the optionee other than the return to optionee of amounts tendered to the

Company upon exercise of the option.

 

J.                                      Effective Date and Termination of the Plan.

 

                The Plan shall

become effective as of April 18, 1997, if approved thereafter by the Company’s

shareholders.  The Plan shall terminate

on the earliest of:

 

(1)           The date when all the shares

available under the Plan shall have been acquired through the exercise of

options granted under the Plan; or

 

(2)           Ten (10) years after the date of

approval of the Plan by the Company’s shareholders; or

 

(3)           Such other earlier date as the Board

may determine.

 

K.                                    Withholding Taxes.

 

                 The Companies shall have the right to take

any action that may be necessary in the opinion of the Companies to satisfy all

obligations for the payment of any federal, state or local taxes of any kind,

including FICA taxes, required by law to be withheld with respect to the

exercise of an option granted hereunder. 

If stock is withheld or surrendered to satisfy tax withholding, such

stock shall be the Fair Market Value of the Company’s common stock on the date

of exercise; provided, however, that no stock may be withheld or surrendered to

satisfy tax withholding obligations under applicable laws of Canada or any

province thereof.

 

L.                                     Fair Market Value.

 

                 “Fair Market Value” shall mean the last

reported sale price of the Company’s common stock on the date of grant, as

quoted on by the New York Stock Exchange. 

If the Company’s common stock ceases to be listed for trading on the New

York Stock Exchange, “Fair Market Value” shall mean the value determined in

good faith by the Board.

 

5

 

M.                                  Compliance with Rule 16b-3 and Section 162(m).

 

                With respect to

employees subject to Section 16 of the Securities Exchange Act of 1934, as

amended, or Section 162(m) of the Code, transactions under the Plan are

intended to comply with all applicable conditions of such Rule 16b-3 and avoid

loss of the deduction referred to in paragraph (1) of such Section 162(m).  Anything in the Plan to the contrary

notwithstanding, to the extent any provision of the Plan or action by the

Committee fails to so comply or avoid the loss of such deduction, it shall be

deemed null and void, to the extent permitted by law and deemed advisable by

the Committee.

 

N.                                    Deferral of Option Gain.

 

                Participants in

the Company’s Deferred Compensation Plan, effective as of April 1, 1998 (the

“Deferred Compensation Plan”), may be able to defer the gain, if any, upon

exercise of options granted hereunder pursuant to and in accordance with the

terms of the Deferred Compensation Plan. 

To the extent that the Deferred Compensation Plan permits a participant

to defer any gain with respect to an option, the Exercise Price must be

satisfied utilizing shares of the Company’s common stock held at least six

months prior to exercise.  In the event

a deferral election is made with respect to an option, if the optionee is

unable to deliver the requisite number of shares of the Company’s common stock

to cover the full Exercise Price prior to the expiration of such option, the

portion of the option that corresponds to the portion of the full Exercise

Price not covered shall be forfeited.

 

O.                                   Form of Option.

 

                Options shall be

issued in substantially the form as the Committee or the Board may approve.

 

 

6

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