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SEARS SETTLES AUTOMOTIVE ISSUES

 SEARS SETTLES AUTOMOTIVE ISSUES
 CHICAGO, Sept. 2 /PRNewswire/ -- Sears, Roebuck and Co. (NYSE: S)


today announced resolution of issues concerning Sears Auto Centers with the State of California, resolution of all 19 automotive class action suits, and launched new operating, educational and customer initiatives to benefit California and U.S. motorists.
 In the settlements, Sears denied any liability or intentional wrongdoing, but said it reached the agreements to avoid the burden, expense and certainty of prolonged litigation.
 Sears also announced that attorneys general of 41 states, led by New Jersey Atty. Gen. Robert Del Tufo, agreed to join with Sears in an effort to develop a comprehensive program to standardize auto repair practices. Del Tufo said, "Those of us who have reviewed this new package of Sears initiatives feel it is an important opportunity to foster national change in the auto repair industry and that it extends equitable financial settlement terms and other consumer protection to consumers in each of our states."
 A group of former attorneys general, led by Neil F. Hartigan of Illinois, has been working with various states on auto repair issues on behalf of Sears. The Hartigan group includes W. J. Michael Cody of Tennessee; Anthony J. Celebrezze, Jr. of Ohio; Brian McKay of Nevada; Tom Miller of Iowa; and LeRoy S. Zimmerman of Pennsylvania.
 Sears also announced that it would offer a national merchandise coupon redemption program for certain auto customers to supplement its long-standing ''Satisfaction Guaranteed'' policy, to serve as a good faith effort with customers in all states, and to resolve national class action suits and State of California issues. Additionally, Sears said that it would not charge customers for cost of repairs beyond the estimate it gives customers.
 California Gov. Pete Wilson and Sears Senior Vice President and Chief Administrative Officer Charles F. Moran outlined the terms of the settlement with the state:
 -- Sears will reimburse California $3.5 million to cover investigative costs, attorneys' fees, general automotive repair monitoring costs and related items.
 -- Sears will establish a fund, of at least $1.5 million, to finance auto repair training programs at California community colleges.
 -- Sears will offer all California auto customers -- and extend to all U.S. auto customers -- who purchased and had Sears install selected products during the period from Aug. 1, 1990 to Jan. 31, 1992, a $50 coupon for each such item or pair of items. These products include a master brake cylinder or idler arm, or a pair of shock absorbers, brake calipers or coil springs. The coupons can be used for the purchase of any merchandise or service in any U.S. Sears retail store, during the year starting Nov. 1, 1992. Sears will advertise details of the coupon program beginning Nov. 1, 1992, and has established a customer phone number (1-800-659-7057) to answer additional questions. If coupon redemptions total less than $3 million in California, Sears will contribute the difference to the college automotive training fund. Sears said about 933,000 transactions nationwide are affected by the coupon redemption agreements. The company said the financial impact of the agreements will not be material and estimated the net after-tax effect on Sears will be less than $15 million.
 -- In addition to the coupon program, Sears will continue to honor its long-standing policy of "Satisfaction Guaranteed or Your Money Back" for all its customers.
 -- All 72 Sears auto centers in California will remain open for business and continue to provide the same products and services.
 -- Sears will continue to provide a preventive maintenance auto repair program to its customers, but will be more specific when informing customers why Sears is recommending such repairs. For example, Sears will specify whether the manufacturer, auto industry standards, or Sears, based on its 60 years of experience in auto repair, is making the recommendation.
 Sears also said that as a result of its work with the states' attorneys general it will expand the automotive responsibilities of Richard Quinn, Sears vice president for customer-focused quality. New areas include strengthening annual customer surveys and tracking mechanisms, developing consumer education materials, coordinating independent audits, and forming a technical advisory panel to assure quality of products and services.
 Moran said, "We are pleased to reach a final resolution which we believe is in the best interests of our customers, associates and shareholders. Today's announcement and the previous actions we've taken show that Sears wanted 'to go the extra mile' to assure our customers that they can be more confident than ever in visiting our auto centers.
 "While we regret any mistakes and inconveniences to customers that occurred, they were not intentional. We are confident that the overwhelming majority of the more than 27 million vehicles we serviced in 1991 and 1992 were done properly and safely, but more important, we believe these settlements should help restore the trust our customers have placed in us over the last 105 years."
 -0- 9/2/92
 /CONTACT: Gerald E. Buldak of Sears, Roebuck and Co., External Communications, 312-875-8371/
 (S) CO: Sears, Roebuck & Co. ST: Illinois IN: AUT REA SU:


PS -- NY060 -- 6029 09/02/92 15:29 EDT
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Date:Sep 2, 1992
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