UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 29, 2002
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-4040
SEARS ROEBUCK ACCEPTANCE CORP.
(Exact name of registrant as specified in its charter)
Delaware 51-0080535
(State of Incorporation) (I.R.S. Employer Identification No.)
3711 Kennett Pike, Greenville, Delaware 19807
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 302/434-3100
Registrant (1) has filed all reports required to be filed by Section 13
or 15(d)of the Securities Exchange Act of 1934 during the preceding 12
months, and (2) has been subject to such filing requirements for the past
90 days.
Yes X No__
As of July 31, 2002 the Registrant had 350,000 shares of capital stock
outstanding, all of which were held by Sears, Roebuck and Co.
Registrant meets the conditions set forth in General Instruction H(1)(a)
and (b) of Form 10-Q and is therefore filing this Form with a reduced
disclosure format.
SEARS ROEBUCK ACCEPTANCE CORP.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
13 WEEKS AND 26 WEEKS ENDED JUNE 29, 2002
PART I. FINANCIAL INFORMATION: PAGE NO.
Item 1. Financial Statements
Statements of Financial Position
June 29, 2002 (unaudited) and June 30, 2001 (unaudited)
and December 29, 2001 1
Statements of Income (unaudited)
13 Weeks and 26 Weeks ended June 29, 2002
and June 30, 2001 2
Statements of Cash Flows (unaudited)
26 Weeks ended June 29, 2002
and June 30, 2001 3
Notes to Financial Statements (unaudited) 4,5
Independent Accountants' Report 6
Item 2. Analysis of Results of Operations 7
PART II. OTHER INFORMATION:
Item 6. Exhibits and Reports on Form 8-K 8
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SEARS ROEBUCK ACCEPTANCE CORP.
STATEMENTS OF FINANCIAL POSITION
(unaudited)
------------------
(millions, except share data) June 29, June 30, Dec. 29,
2002 2001 2001
-------- -------- --------
Assets
Cash and cash equivalents $ 579 $ 163 $ 599
Notes of Sears 17,746 16,210 16,014
Other assets 61 49 125
-------- -------- --------
Total assets $ 18,386 $ 16,422 $ 16,738
Liabilities
Commercial paper (net of
unamortized discount of
$10, $11 and $9) $ 3,880 $ 2,892 $ 3,225
Medium-term notes (net of
unamortized discount of
$5, $7 and $6) 2,500 3,820 2,762
Discrete underwritten debt (net
of unamortized discount of
$60, $26 and $29) 8,540 6,374 7,321
Accrued interest and
other liabilities 167 165 192
-------- -------- --------
Total liabilities 15,087 13,251 13,500
Shareholder's Equity
Common share, par value $100 per share;
500,000 shares authorized;
350,000 shares issued and
outstanding 35 35 35
Capital in excess of par value 1,150 1,150 1,150
Accumulated other
comprehensive loss (3) - -
Retained income 2,117 1,986 2,053
-------- -------- --------
Total shareholder's equity 3,299 3,171 3,238
-------- -------- --------
Total liabilities and
shareholder's equity $ 18,386 $ 16,422 $ 16,738
======== ======== ========
See notes to financial statements.
1
SEARS ROEBUCK ACCEPTANCE CORP.
STATEMENTS OF INCOME
(unaudited)
(millions, except ratios) 13 Weeks Ended 26 Weeks Ended
June 29, June 30, June 29, June 30,
2002 2001 2002 2001
------- ------- ------- -------
Revenues
Earnings on notes of Sears $ 240 $ 274 $ 474 $ 574
Earnings on cash equivalents 5 2 8 6
----- ----- ----- -----
Total revenues 245 276 482 580
----- ----- ----- -----
Expenses
Interest expense and amortization
of debt discount/premium 195 220 383 461
Operating expenses 1 - 1 1
----- ----- ----- -----
Total expenses 196 220 384 462
----- ----- ----- -----
Income before income taxes 49 56 98 118
Income taxes 17 19 34 41
----- ----- ----- -----
Net income $ 32 $ 37 $ 64 $ 77
===== ===== ===== =====
Ratios of earnings
to fixed charges 1.25 1.25 1.26 1.26
See notes to financial statements.
2
SEARS ROEBUCK ACCEPTANCE CORP.
STATEMENTS OF CASH FLOWS
(unaudited)
(millions) 26 Weeks Ended
June 29, June 30,
2002 2001
-------- -------
Cash flows from operating activities:
Net income $ 64 $ 77
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation, amortization and other
noncash items 7 5
Decrease(increase)in other assets 80 (4)
(Decrease)increase in other liabilities (25) 14
------- -------
Net cash provided by operating activities 126 92
------- -------
Cash flows from investing activities:
(Increase)decrease in notes of Sears (1,732) 669
------- -------
Net cash (used in)provided by
investing activities (1,732) 669
------- -------
Cash flows from financing activities:
Increase(decrease) in commercial paper,
primarily 90 days or less 655 (1,042)
Proceeds from issuance of long-term debt 1,832 793
Payments for redemption of long-term debt (877) (788)
Issue costs paid to issue debt (24) (3)
------- -------
Net cash provided by (used in)
financing activities 1,586 (1,040)
------- -------
Net decrease in cash and
cash equivalents (20) (279)
Cash and cash equivalents at beginning
of period 599 442
------- -------
Cash and cash equivalents at end of period $ 579 $ 163
======= =======
See notes to financial statements.
3
SEARS ROEBUCK ACCEPTANCE CORP.
NOTES TO FINANCIAL STATEMENTS
(unaudited)
1. Significant Accounting Policies
The unaudited interim financial statements of Sears Roebuck Acceptance
Corp. ("SRAC"), a wholly-owned subsidiary of Sears, Roebuck and Co. ("Sears"),
reflect all adjustments (consisting only of normal recurring accruals) which
are, in the opinion of management, necessary for a fair statement of the
results for the interim periods presented.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted. The significant
accounting policies used in the presentation of these financial statements are
consistent with the summary of significant accounting policies set forth in
SRAC's Annual Report on Form 10-K for the 52 weeks ended December 29, 2001, and
these financial statements should be read in conjunction with the financial
statements and notes found therein. The results of operations for the interim
periods should not be considered indicative of the results to be expected for
the full year.
2. Comprehensive Income (Loss) and Accumulated Other Comprehensive Loss
The following table shows the computation of comprehensive income(loss):
13 Weeks Ended 26 Weeks Ended
(millions) June 29, June 30, June 29, June 30,
2002 2001 2002 2001
------- ------ ------- -------
Net income $ 32 $ 37 $ 64 $ 77
Other comprehensive income(loss)
Losses on cash flow hedge,
net of tax (3) - (3) -
Amounts amortized into interest
expense from OCI - - - -
Total other comprehensive loss (3) - (3) -
----- ----- ----- -----
Total comprehensive income $ 29 $ 37 $ 61 $ 77
===== ===== ===== =====
The following table displays the components of accumulated other comprehensive
loss:
(millions) June 29, June 30, Dec. 29,
2002 2001 2001
------- ------- --------
Accumulated cash flow hedge loss $ (3) $ - $ -
------- ------- -------
Accumulated other comprehensive loss $ (3) $ - $ -
======= ======= =======
4
3. Back-up Liquidity
SRAC continued to provide support for 100% of its outstanding commercial paper
through its investment portfolio and committed credit facilities. SRAC's
investment portfolio, which consists of cash and cash equivalents, fluctuated
from a low of $324 million to a high of $2,291 million in the second quarter
of 2002. Credit facilities as of June 29, 2002 were as follows:
Expiration Date (millions)
------------------------------------------------------------
April 2003 $4,360
------------------------------------------------------------
4. Medium-term Notes and Discrete Underwritten Debt
Medium-term notes and discrete underwritten debt are issued with
either a floating rate indexed to LIBOR or a fixed rate.
(dollars in millions; terms in years)
ISSUANCE
Avg. Avg.
2002 Avg. Orig. 2001 Avg. Orig.
Volume Rate Term Volume Rate Term
------ ------ ---- ------ ------ ----
13 Weeks Ended:
Medium-term notes $ - -% - $ - -% -
Discrete debt $1,250 7.19% 32.0 $ - -% -
26 Weeks Ended:
Medium-term notes $ 15 4.50% 2.6 $ - -% -
Discrete debt $1,850 7.03% 24.9 $ 800 7.00% 10.0
GROSS OUTSTANDING
Avg. Avg.
06/29/02 Avg. Remain. 06/30/01 Avg. Remain.
Balance Coupon Term Balance Coupon Term
-------- ------ ------ ------- ------ -------
Medium-term notes $2,505 5.91% 1.4 $3,827 6.46% 1.5
Discrete debt $8,600 6.97% 13.5 $6,400 6.65% 10.5
MATURITIES
Medium-term Discrete
Year notes debt
---------------------------------
2002 $ 680 $ -
2003 1,246 1,250
2004 317 -
2005 36 250
2006 40 550
Thereafter 186 6,550
---------------------------------
Total $2,505 $8,600
=================================
5
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors and Shareholder of
Sears Roebuck Acceptance Corp.:
We have reviewed the accompanying statements of financial
position of Sears Roebuck Acceptance Corp. (a wholly-owned
subsidiary of Sears, Roebuck and Co.) as of June 29, 2002 and
June 30, 2001, and the related statements of income for the
13 week and 26 week periods then ended and cash flows for the
26 week periods then ended. These financial statements are the
responsibility of Sears Roebuck Acceptance Corp.'s management.
We conducted our reviews in accordance with standards established
by the American Institute of Certified Public Accountants. A
review of interim financial information consists principally of
applying analytical procedures to financial data and of making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with auditing standards generally accepted in the United
States of America, the objective of which is the expression of an
opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material
modifications that should be made to such financial statements
for them to be in conformity with accounting principles generally
accepted in the United States of America.
We have previously audited, in accordance with auditing standards
generally accepted in the United States of America, the statement
of financial position of Sears Roebuck Acceptance Corp. as of
December 29, 2001 and the related statements of income, shareholder's
equity and cash flows for the year then ended (not presented herein);
and in our report dated January 17, 2002, we expressed an unqualified
opinion on those financial statements. In our opinion, the information
set forth in the accompanying statement of financial position as of
December 29, 2001 is fairly stated, in all material respects, in
relation to the statement of financial position from which it has been
derived.
/s/ Deloitte & Touche LLP
-------------------------
Deloitte & Touche LLP
Philadelphia, Pennsylvania
July 9, 2002
6
SEARS ROEBUCK ACCEPTANCE CORP.
ITEM 2. ANALYSIS OF RESULTS OF OPERATIONS
During the second quarter of 2002, SRAC revenues decreased to $245 million
from $276 million in the comparable 2001 period. For the first six months of
2002, SRAC's revenues declined to $482 million from $580 million for the
comparable 2001 period. The decrease in revenue resulted from a reduction in
the average rates on earning assets.
SRAC's interest and related expenses decreased 11% to $195 million from
$220 million and 17% to $383 million from $461 million for the second quarter
and first half of 2002, respectively, as compared to the comparable 2001
periods. Interest and related expenses decreased during the second quarter and
first half of 2002 due to decreases in the cost of funds and average long-term
debt levels. SRAC's cost of short-term funds averaged 2.18% in the second
quarter and 2.34% in the first six months of 2002 compared to 5.08% and 6.18%
for the same periods in 2001. SRAC's cost of long-term funds averaged 6.54% in
both the second quarter and first six months of 2002 compared to 6.64% and
6.68% for the same periods in 2001. SRAC's average long-term debt decreased to
$10.4 billion and $10.1 billion in the second quarter and first six months of
2002, respectively, compared with $10.5 billion and $10.6 million for the same
periods in 2001. Reductions in interest and related expenses were partially
offset during these periods by increases in average short-term debt levels.
SRAC's short-term borrowings averaged $3.7 billion and $3.6 billion for both
the second quarter and first half of 2002, compared to $3.4 billion for both
the respective 2001 periods.
On April 22, 2002, $875 million of SRAC's credit facilities terminated.
During the second quarter of 2002, SRAC increased the aggregate amount of the
commitments under the remaining facility resulting in a credit facility of
$4,360 million terminating April 2003.
On May 29, 2002, SRAC issued a $1 billion 30-year discrete underwritten
bond with a 7.00% coupon at a yield of 7.24%. On June 27, 2002 SRAC issued a
$250 million 40-year discrete underwritten bond with a coupon of 7.0%.
SRAC's net income of $32 million and $64 million for the second quarter
and first half of 2002, respectively, decreased from the comparable 2001 period
amounts of $37 million and $77 million.
SRAC's ratio of earnings to fixed charges for the second quarter and first
half of 2002 was 1.25 and 1.26, respectively compared to 1.25 and 1.26 for the
comparable 2001 periods.
7
SEARS ROEBUCK ACCEPTANCE CORP.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The exhibits listed in the "Exhibit
Index" are filed as part of this
report.
(b) Reports on Form 8-K:
Registrant filed Current Reports on
Form 8-K dated May 21, 2002 and
June 27, 2002 [Items 5 and 7].
8
SEARS ROEBUCK ACCEPTANCE CORP.
SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934,
the Registrant has duly caused this
report to be signed on its behalf by
the undersigned thereunto duly
authorized.
SEARS ROEBUCK ACCEPTANCE CORP.
(Registrant)
By: /s/ George F. Slook
-------------------
George F. Slook
Vice President, Finance
and Assistant Secretary
(principal financial
officer and authorized
officer of Registrant)
August 12, 2002
9
EXHIBIT INDEX
3(a) Certificate of Incorporation of the Registrant, as in
effect at November 13, 1987 [Incorporated by reference to
Exhibit 28(c)to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended September 30, 1987**].
3(b) By-laws of the Registrant, as in effect at October 20, 1999
[Incorporated by reference to Exhibit 3(b) to the
Registrant's Quarterly Report on Form 10-Q for the
Quarter ended October 2, 1999**]
4(a) The Registrant hereby agrees to furnish the Commission,
upon request, with each instrument defining the rights
of holders of long-term debt of the Registrant with
respect to which the total amount of securities
authorized does not exceed 10% of the total assets of
the Registrant.
4(b) Form of 7.00% Note [Incorporated by reference to Exhibit 4
to the Registrant's Current Report on Form 8-K
dated May 21,2002**].
4(c) Form of 7% Note [Incorporated by reference to Exhibit 4
to the Registrant's Current Report on Form 8-K
dated June 27,2002**].
4(d) Indenture dated as of May 15, 1995 between the Registrant
and The Chase Manhattan Bank [Incorporated by reference
to Exhibit 4(b) to Amendment No. 1 to Registration
Statement No. 33-64215**].
4(e) Letter Agreement dated April 23, 2002 between Registrant
and The Bank of Nova Scotia relating to a $75 million
commitment under the Amended and Restated Credit Agreement
dated April 28, 1997.*
4(f) Letter Agreement dated June 26, 2002 between Registrant
and Morgan Stanley Bank relating to a $100 million commitment
under the Amended and Restated Credit Agreement dated
April 28, 1997.*
12 Calculation of ratios of earnings to fixed charges.*
----------------------
* Filed herewith.
** SEC File No. 1-4040.
10
EXHIBIT INDEX
15 Acknowledgment of awareness from Deloitte & Touche LLP,
dated August 12, 2002 concerning unaudited financial
information.*
99(a) Certification of Chief Executive Officer Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002(18 U.S.C.1350)*
99(b) Certification of Chief Financial Officer Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002(18 U.S.C.1350)*
----------------------
* Filed herewith.
11
Exhibit 4(e)
SEARS ROEBUCK ACCEPTANCE CORP.
3711 Kennett Pike
Greenville, Delaware 19807
April 23, 2002
The Bank of Nova Scotia
Suite 2700
600 Peachtree Street, N.E.
Atlanta, Georgia 30308
JPMorgan Chase Bank, as Agent
270 Park Avenue
47th Floor
New York, NY 10017
Attention: Teri Streusand
Ladies and Gentlemen:
Each of Sears Roebuck Acceptance Corp. (the "Borrower") and The Bank
of Nova Scotia (the "New Bank") refers to the Amended and Restated Credit
Agreement (the "Credit Agreement") dated as of April 28, 1997 and as amended
to date among the Borrower, the Banks parties thereto, the Senior Managing
Agent, Managing Agents, Co-Arrangers, Co-Agents and Lead Managers referred
to therein and JPMorgan Chase Bank (formerly known as Morgan Guaranty Trust
Company of New York), as Agent, and to the provisions of Section 2.17 of
the Credit Agreement ("Section 2.17") providing for an increase of the
aggregate amount of the Commitments at the option of the Borrower.
This letter (the "Letter") is being delivered in satisfaction of the
requirement in Section 2.17 that the Borrower and the New Bank deliver
an instrument in form satisfactory to the Agent with respect to any
increase of Commitments thereunder. Capitalized terms used but not
defined herein are used as defined in the Credit Agreement.
1. The Borrower hereby designates the New Bank to become a
Bank under the Credit Agreement with a Commitment of $75,000,000 (the "New
Commitment Amount") and with a Termination Date of April 22, 2003 (the
"New Termination Date"). The New Bank hereby accepts such designation
and agrees, upon the effectiveness of this Letter as provided in Section 4
below, to be a Bank in all respects, and to have all of the rights and be
obligated to perform the obligations of a Bank, under the Credit
Agreements, with a Commitment equal to the New Commitment Amount and a
Termination Date initially of the New Termination Date.
2. The Borrower represents and warrants that:
(a) on and as of the date hereof, and after giving effect to
the increase in Commitments contemplated by this Letter, (i) no
Default has occurred and is continuing and (ii) each of the
representations and warranties of the Borrower in the Credit
Agreement is true and correct in all material respects;
(b) no Commitment of any Bank shall exceed, as a result of
such increase provided by this Letter, 10% of the aggregate amount
of the Commitments (after giving effect to such increase); and
(c) the aggregate amount of all increases in the Commitments
pursuant to Section 2.17 since the date of the Credit Agreement
does not exceed $1,250,000,000.
12
3. The New Bank represents to the Borrower and the Agent
that is it not a Non-U.S. Bank.
4. This Letter (i) shall be governed by and construed in
accordance with the laws of the State of New York, (ii) may be signed in
any number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument and (iii) shall become effective as of April 23, 2002, provided
that on or prior to such date the Agent shall have received from each of
the Borrower and the New Bank and the Agent a counterpart hereof signed by
such party or facsimile or other written confirmation (in form
satisfactory to the Agent) that such party has signed a counterpart
hereof. The execution of a counterpart hereof by the Agent shall
constitute the Agent's prior written consent to the designation of the
New Bank as a Bank.
Very truly yours,
SEARS ROEBUCK ACCEPTANCE CORP.
By /s/ George F. Slook
-----------------------
Name: George F. Slook
Title: Vice President, Finance
THE BANK OF NOVA SCOTIA
By /s/ M.D. Smith
-----------------
Name: M.D. Smith
Title: Agent Operations
Consented to as of the date first written above:
JPMORGAN CHASE BANK, AS AGENT
By /s/ Teri Streusand
---------------------
Name: Teri Streusand
Title: Vice President
13
Exhibit 4(f)
SEARS ROEBUCK ACCEPTANCE CORP.
3711 Kennett Pike
Greenville, Delaware 19807
June 26, 2002
Morgan Stanley Bank
1585 Broadway
2nd Floor
New York, New York 10036
Attn: James Morgan
212-537-1470, phone
212-537-1867, fax
JPMorgan Chase Bank, as Agent
270 Park Avenue
47th Floor
New York, NY 10017
Attention: Teri Streusand
Ladies and Gentlemen:
Each of Sears Roebuck Acceptance Corp. (the "Borrower") and Morgan
Stanley Bank (the "New Bank") refers to the Amended and Restated Credit
Agreement (the "Credit Agreement") dated as of April 28, 1997 among the
Borrower, the Banks parties thereto, the Senior Managing Agent, Managing
Agents, Co-Arrangers, Co-Agents and Lead Managers referred to therein and
JPMorgan Chase Bank (formerly known as Morgan Guaranty Trust Company of
New York), as Agent, and to the provisions of Section 2.17 of the Credit
Agreement ("Section 2.17") providing for an increase of the aggregate
amount of the Commitments at the option of the Borrower. This letter
(the "Letter") is being delivered in satisfaction of the requirement in
Section 2.17 that the Borrower and the New Bank deliver an instrument in
form satisfactory to the Agent with respect to any increase of Commitments
thereunder. Capitalized terms used but not defined herein are used as
defined in the Credit Agreement.
1. The Borrower hereby designates the New Bank to become a
Bank under the Credit Agreement with a Commitment of $100,000,000 (the
"New Commitment Amount") and with a Termination Date of April 22, 2003
(the "New Termination Date"). The New Bank hereby accepts such designation
and agrees, upon the effectiveness of this Letter as provided in Section 4
below, to be a Bank in all respects, and to have all of the rights and be
obligated to perform the obligations of a Bank, under the Credit
Agreements, with a Commitment equal to the New Commitment Amount and a
Termination Date initially of the New Termination Date.
2. The Borrower represents and warrants that:
(a) on and as of the date hereof, and after giving effect to
the increase in Commitments contemplated by this Letter, (i) no
Default has occurred and is continuing and (ii) each of the
representations and warranties of the Borrower in the Credit
Agreement is true and correct in all material respects;
(b) no Commitment of any Bank shall exceed, as a result of
such increase provided by this Letter, 10% of the aggregate
amount of the Commitments (after giving effect to such increase);
and
(c) the aggregate amount of all increases in the Commitments
pursuant to Section 2.17 since the date of the Credit Agreement
does not exceed $1,250,000,000.
14
3. The New Bank represents to the Borrower and the Agent
that is it not a Non-U.S. Bank.
4. This Letter (i) shall be governed by and construed in
accordance with the laws of the State of New York, (ii) may be
signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument and (iii) shall become
effective as of June 26, 2002, provided that on or prior to such
date the Agent shall have received from each of the Borrower
and the New Bank and the Agent a counterpart hereof signed by
such party or facsimile or other written confirmation (in form
satisfactory to the Agent) that such party has signed a
counterpart hereof. The execution of a counterpart hereof by the
Agent shall constitute the Agent's prior written consent to the
designation of the New Bank as a Bank.
Very truly yours,
SEARS ROEBUCK ACCEPTANCE CORP.
By /s/ Keith E. Trost
---------------------
Name: Keith E. Trost
Title: President
MORGAN STANLEY BANK
By /s/ Jaap L. Tonckens
-----------------------
Name: Jaap L. Tonckens
Title: Vice President
Consented to as of the date first written above:
JPMORGAN CHASE BANK, AS AGENT
By /s/ Teri Streusand
----------------------
Name: Teri Streusand
Title: Vice President
15
Exhibit 12
SEARS ROEBUCK ACCEPTANCE CORP.
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
13 Weeks Ended 26 Weeks Ended
June 29, June 30, June 29, June 30,
(millions) 2002 2001 2002 2001
------- ------- ------- -------
INCOME BEFORE INCOME TAXES $ 49 $ 56 $ 98 $ 118
PLUS FIXED CHARGES:
Interest 192 219 376 456
Amortization of debt
discount/premium 3 1 7 5
----- ----- ----- -----
Total fixed charges 195 220 383 461
----- ----- ----- -----
EARNINGS BEFORE INCOME TAXES
AND FIXED CHARGES $ 244 $ 276 $ 481 $ 579
===== ===== ===== =====
RATIO OF EARNINGS TO FIXED
CHARGES 1.25 1.25 1.26 1.26
16
EXHIBIT 15
Sears Roebuck Acceptance Corp.
Greenville, Delaware
We have made a review, in accordance with standards established
by the American Institute of Certified Public Accountants, of
the unaudited interim financial information of Sears Roebuck
Acceptance Corp. for the 13 week and 26 week periods ended
June 29, 2002 and June 30, 2001, as indicated in our report
dated July 9, 2002; because we did not perform an audit, we
expressed no opinion on that information.
We are aware that our report referred to above, which is
included in your Quarterly Report on Form 10-Q for the quarter
ended June 29, 2002, is incorporated by reference in Registration
Statement No.333-92082 on Form S-3.
We are also aware that the aforementioned reports, pursuant to
Rule 436(c) under the Securities Act of 1933, is not considered
a part of the Registration Statement prepared or certified by an
accountant or a report prepared or certified by an accountant
within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touche LLP
-------------------------
Deloitte & Touche LLP
Philadelphia, Pennsylvania
August 12, 2002
17
Exhibit 99(a)
CERTIFICATION OF CHIEF EXECUTUVE OFFICER
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350)
The undersigned, Keith E. Trost, President of Sears Roebuck Acceptance
Corp.(the "Company"), has executed this certification in connection with
the filing with the Securities and Exchange Commission of the Company's
Quarterly Report on Form 10-Q for the quarter ended June 29, 2002
(the "Report").
The undersigned hereby certifies that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of
the Company.
IN WITNESS WHEREOF, the undersigned has executed this certification as of
the 12th day of August, 2002.
/s/ Keith E. Trost
------------------
Keith E. Trost
President(chief executive officer)
August 12, 2002
18
Exhibit 99(b)
CERTIFICATION OF CHIEF FINANCIAL OFFICER
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C.1350)
The undersigned, George F. Slook, Vice President, Finance of Sears
Roebuck Acceptance Corp.(the "Company"),has executed this certification
in connection with the filing with the Securities and Exchange Commission
of the Company's Quarterly Report on Form 10-Q for the quarter ended
June 29, 2002 (the "Report").
The undersigned hereby certifies that:
(1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of
the Company.
IN WITNESS WHEREOF, the undersigned has executed this certification as
of the 12th day of August, 2002.
/s/ George F. Slook
-------------------
George F. Slook
Vice President, Finance (chief financial officer)
August 12, 2002
19