EXHIBIT 4.7
REGISTRATION RIGHTS AGREEMENT
dated as of August 6, 1999
between
STATER BROS. HOLDINGS INC.,
as Issuer
and
BANC OF AMERICA SECURITIES LLC,
as Initial Purchaser
TABLE OF CONTENTS
1. Definitions............................................................. 1
2. Exchange Offer.......................................................... 4
3. Shelf Registration...................................................... 7
4. Liquidated Damages...................................................... 8
5. Registration Procedures................................................. 9
6. Registration Expenses...................................................17
7. Indemnification.........................................................18
8. Rules 144 and 144A......................................................21
9. Underwritten Registrations..............................................21
10. Miscellaneous...........................................................21
This Registration Rights Agreement (the "Agreement") is dated as of
August 6, 1999, by and between Stater Bros. Holdings Inc., a Delaware
corporation, as the issuer ("Stater Bros."), and Banc of America Securities LLC,
as the initial purchaser (the "Initial Purchaser").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of August 2, 1999, between Stater Bros. and the Initial
Purchaser (the "Purchase Agreement") relating to the sale by Stater Bros. to the
Initial Purchaser of $450,000,000 aggregate principal amount of Stater Bros.' 10
3/4% Senior Notes due 2006 (the "Notes"). In order to induce the Initial
Purchaser to enter into the Purchase Agreement, Stater Bros. has agreed to
provide the registration rights set forth in this Agreement for the equal
benefit of the Initial Purchaser and its respective direct and indirect
transferees. The execution and delivery of this Agreement is a condition to the
Initial Purchaser's obligation to purchase the Notes under the Purchase
Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
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As used in this Agreement, the following terms shall have the
following meanings:
"Advice": See Section 5.
"Applicable Period": See Section 2.
"Closing Date": The closing of the offering of the Notes to the
Initial Purchaser.
"Commission": The Securities and Exchange Commission.
"Effectiveness Date": The 150th day after the Closing Date.
"Effectiveness Target Date": See Section 4.
"Effectiveness Period": See Section 3.
"Event Date": See Section 4.
"Exchange Act": The Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Exchange Deadline": See Section 2.
"Exchange Notes": See Section 2.
"Exchange Offer": See Section 2.
"Exchange Offer Registration Statement": See Section 2.
"Filing Date": The 30th day after the Closing Date.
"Holder": Any holder of Transfer Restricted Securities.
"Holders Counsel": See Section 5.
"Indenture": The Indenture, dated as of August 6, 1999, between
Stater Bros. and IBJ Whitehall Bank & Trust Company, as trustee, pursuant to
which the Notes are being issued, as amended or supplemented from time to time
in accordance with the terms thereof.
"Initial Purchaser": See the introductory paragraph to this
Agreement.
"Initial Shelf Registration Statement": See Section 3.
"Inspectors": See Section 5.
"Liquidated Damages": See Section 4.
"NASD": See Section 5.
"Notes": See the introductory paragraphs to this Agreement.
"Participant": See Section 7.
"Participating Broker-Dealer": See Section 2.
"Person": An individual, trustee, corporation, partnership, joint
stock company, limited liability company, trust, unincorporated association,
union, business association, firm or other legal entity.
"Private Exchange": See Section 2.
"Private Exchange Notes": See Section 2.
"Prospectus": The prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Transfer Restricted Securities covered by such Registration Statement,
and all other amendments and supplements to the Prospectus, including post-
effective amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
"Records": See Section 5.
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"Registration Default": See Section 4.
"Registration Statement": Any registration statement of Stater Bros.,
including, but not limited to, the Exchange Offer Registration Statement, that
covers any of the Transfer Restricted Securities pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits, and
all material incorporated by reference or deemed to be incorporated by reference
in such registration statement.
"Rule 144": Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule (other than Rule 144A) or
regulation hereafter adopted by the Commission providing for offers and sales of
securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer of such securities being
free of the registration and prospectus delivery requirements of the Securities
Act.
"Rule 144A": Rule 144A under the Securities Act, as such Rule may be
amended from time to time, or any similar rule (other than Rule 144) or
regulation hereafter adopted by the Commission providing for offers and sales of
securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer of such securities being
free of the registration and prospectus delivery requirements of the Securities
Act.
"Rule 415": Rule 415 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the Commission.
"Securities Act": The Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Selling Holders": See Section 5.
"Shelf Notice": See Section 2.
"Shelf Registration Statement": See Section 3.
"Stater Bros.": See the introductory paragraph to this Agreement.
"Subsequent Shelf Registration Statement": See Section 3.
"TIA": The Trust Indenture Act of 1939, as amended.
"Transfer Restricted Security": Each Note until:
(i) the date on which such Note has been exchanged by a Person
other than a broker-dealer for an Exchange Note in the Exchange Offer;
(ii) following the exchange by a broker-dealer in the Exchange Offer
of a Note for an Exchange Note, the date on which such Exchange Note is
sold to a purchaser who
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receives from such broker-dealer on or prior to the date of such sale a
copy of the Prospectus contained in the Exchange Offer Registration
Statement;
(iii) the date on which such Note has been effectively registered
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement; or
(iv) the date on which such Note is distributed to the public
pursuant to Rule 144 under the Securities Act.
"Trustee": The trustee under the Indenture and, if existent, the
trustee under any indenture governing the Exchange Notes and Private Exchange
Notes (if any).
"Underwritten registration or underwritten offering": A registration
in which securities of Stater Bros. are sold to an underwriter for reoffering to
the public.
2. EXCHANGE OFFER
--------------
(a) Stater Bros. agrees to file with the Commission as soon as
practicable after the Closing Date, but in no event later than the Filing Date,
an offer to exchange (the "Exchange Offer") any and all of the Transfer
Restricted Securities for a like aggregate principal amount of debt securities
of Stater Bros., the terms of which are substantially identical to the Notes
(the "Exchange Notes") (and which are entitled to the benefits of the Indenture
or a trust indenture which is identical to the Indenture (other than such
changes to the Indenture or any such identical trust indenture as are necessary
to comply with any requirements of the Commission to effect or maintain the
qualification thereof under the TIA) in all material respects and which, in
either case, has been qualified under the TIA), except that the Exchange Notes
shall have been registered pursuant to an effective Registration Statement under
the Securities Act. The Exchange Offer will be registered under the Securities
Act on the appropriate form (the "Exchange Offer Registration Statement") and
will comply with all applicable tender offer rules and regulations under the
Exchange Act. Unless the Exchange Offer would not be permitted by applicable law
or Commission policy, Stater Bros. will commence the Exchange Offer and use its
best efforts to (x) cause the Exchange Offer Registration Statement to become
declared effective under the Securities Act on or before the Effectiveness Date;
(y) keep the Exchange Offer open for at least 30 days (or longer if required by
applicable law) after the date that notice of the Exchange Offer is mailed to
Holders; and (z) issue, on or prior to the later of (1) the 30th business day
following the date on which the Exchange Offer Registration Statement was
declared effective by the Commission, and (2) the earliest possible date
following such 30th business day if a longer period is required by federal
securities laws (such later date being the "Exchange Deadline"), Exchange Notes
in exchange for all Notes tendered prior thereto in the Exchange Offer. Each
Holder who participates in the Exchange Offer will be required to represent that
any Exchange Notes received by it will be acquired in the ordinary course of its
business, that at the time of the consummation of the Exchange Offer such Holder
will have no arrangement or understanding with any person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Notes,
and that such Holder is not an affiliate of Stater Bros. within the meaning of
the Securities Act. Upon consummation of the Exchange Offer in accordance with
this Section 2, the provisions of this Agreement shall continue to apply,
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mutatis mutandis, solely with respect to Transfer Restricted Securities that are
Private Exchange Notes and Exchange Notes held by Participating Broker-Dealers,
and Stater Bros. shall have no further obligation to register Transfer
Restricted Securities (other than Private Exchange Notes) pursuant to Section 3
of this Agreement.
(b) Stater Bros. shall include within the Prospectus contained in the
Exchange Offer Registration Statement a section entitled "Plan of Distribution"
reasonably acceptable to the Initial Purchaser, which shall contain a summary
statement of the positions taken or policies made by the Staff of the Commission
with respect to the potential "underwriter" status of any broker-dealer that is
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of
Exchange Notes received by such broker-dealer in the Exchange Offer (a
"Participating Broker-Dealer"), whether such positions or policies have been
publicly disseminated by the Staff of the Commission or such positions or
policies, in the judgment of the Initial Purchaser, represent the prevailing
views of the Staff of the Commission. Such "Plan of Distribution" section shall
also allow the use of the Prospectus by all persons subject to the prospectus
delivery requirements of the Securities Act, including all Participating Broker-
Dealers, and include a statement describing the means by which Participating
Broker-Dealers may resell the Exchange Notes.
Stater Bros. shall use its best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the Prospectus
contained therein, in order to permit such Prospectus to be lawfully delivered
by all persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such persons must comply with such requirements
in order to resell the Exchange Notes, provided that such period shall not
exceed 180 days (or such longer period if extended pursuant to the last
paragraph of Section 5) (the "Applicable Period").
If, prior to the commencement or consummation of the Exchange Offer,
the Initial Purchaser holds any Notes acquired by it and having the status as an
unsold allotment in the initial distribution, Stater Bros., upon the request of
the Initial Purchaser, shall issue and deliver to the Initial Purchaser, in
exchange (the "Private Exchange") for such Notes held by the Initial Purchaser,
a like principal amount of debt securities of Stater Bros. that are identical to
the Exchange Notes (the "Private Exchange Notes") (and which are issued pursuant
to the same indenture as the Exchange Notes). The Private Exchange Notes shall
bear the same CUSIP number as the Exchange Notes. Interest on the Exchange
Notes and Private Exchange Notes will accrue from the last interest payment date
on which interest was paid to the Initial Purchaser on the Notes surrendered in
exchange therefor or, if no interest has been paid on the Notes, from the date
of original issue.
In connection with the Exchange Offer, Stater Bros. shall:
(i) mail to each Holder a copy of the Prospectus forming part of
the Exchange Offer Registration Statement, together with an appropriate
letter of transmittal and related documents;
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(ii) utilize the services of a Depositary for the Exchange Offer
with an address in the Borough of Manhattan, The City of New York; and
(iii) permit Holders to withdraw tendered Notes at any time prior to
the close of business, New York time, on the last business day on which the
Exchange Offer shall remain open.
As soon as practicable after the close of the Exchange Offer or the
Private Exchange, as the case may be, Stater Bros. shall:
(1) accept for exchange all Notes tendered and not validly
withdrawn pursuant to the Exchange Offer or the Private Exchange;
(2) deliver to the Trustee for cancellation all Notes so
accepted for exchange; and
(3) cause the Trustee to authenticate and deliver promptly to
each Holder of Notes, Exchange Notes or Private Exchange Notes, as the case
may be, equal in principal amount to the Notes of such Holder so accepted
for exchange.
The Exchange Notes and the Private Exchange Notes may be issued under
(A) the Indenture or (B) an indenture substantially identical to the Indenture,
which in either event will provide that the Exchange Notes will not be subject
to the transfer restrictions set forth in the Indenture and that the Exchange
Notes, the Private Exchange Notes and the Notes will vote and consent together
on all matters as one class and that neither the Exchange Notes, the Private
Exchange Notes nor the Notes will have the right to vote or consent as a
separate class on any matter.
(c) If (i) the Exchange Offer is not permitted by applicable law or
Commission policy, (ii) any Holder of Transfer Restricted Securities notifies
Stater Bros. prior to the 20th day following the Exchange Offer that (A) such
Holder is prohibited by law or Commission policy from participating in the
Exchange Offer; (B) such Holder may not resell the Exchange Notes acquired by it
in the Exchange Offer to the public without delivering a prospectus and the
Prospectus contained in the Exchange Offer Registration Statement is neither
appropriate nor available for such resales; or (C) it is a broker-dealer and
owns Notes acquired directly from Stater Bros. or an affiliate of Stater Bros.
or (iii) the Exchange Offer is commenced and not consummated within 180 days
after the Closing Date for any reason, then Stater Bros. shall promptly deliver
to the Holders and the Trustee written notice thereof (the "Shelf Notice") and
shall file an Initial Shelf Registration Statement pursuant to Section 3.
Following the delivery of a Shelf Notice to the Holders of Transfer Restricted
Securities (only in the circumstances contemplated by clause (i) of the
preceding sentence and only if Stater Bros. shall have satisfied its
obligations, if any, pursuant to Section 5(w) below), Stater Bros. shall not
have any further obligation to conduct the Exchange Offer or the Private
Exchange under this Section 2.
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3. SHELF REGISTRATION
------------------
If a Shelf Notice is delivered as contemplated by Section 2(c), then:
(a) Initial Shelf Registration Statement. Stater Bros. shall
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carefully prepare and file with the Commission a Registration Statement for an
offering to be made on a continuous basis pursuant to Rule 415 covering all of
the Transfer Restricted Securities (the "Initial Shelf Registration Statement").
Stater Bros. shall use its best efforts to file such Initial Shelf Registration
Statement with the Commission as promptly as practicable after such obligation
arises and to cause the Shelf Registration Statement to be declared effective by
the Commission on or prior to 120 days after such obligation arises. The Initial
Shelf Registration Statement shall be on Form S-3 or another appropriate form
permitting registration of such Transfer Restricted Securities for resale by
such Holders in the manner or manners designated by them (including, without
limitation, one or more underwritten offerings). Stater Bros. shall not permit
any securities other than the Transfer Restricted Securities to be included in
the Initial Shelf Registration Statement or any Subsequent Shelf Registration
Statement. No Holder of Transfer Restricted Securities may include any of its
Transfer Restricted Securities in any Shelf Registration Statement pursuant to
this Agreement unless and until such Holder furnishes to Stater Bros. in
writing, within 15 business days after receipt of a request therefor, such
information as Stater Bros. may reasonably request for use in connection with
any Shelf Registration Statement or Prospectus or preliminary Prospectus
included therein. No Holder of Transfer Restricted Securities shall be entitled
to Liquidated Damages pursuant to Section 4 hereof unless and until such Holder
shall have used its best efforts to provide all such reasonably requested
information. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to Stater Bros. all information to be
disclosed in order to make the information previously furnished to Stater Bros.
by such Holder not materially misleading. Stater Bros. shall use its best
efforts to cause the Initial Shelf Registration Statement to be declared
effective under the Securities Act on or prior to the Effectiveness Date and to
keep the Initial Shelf Registration Statement continuously effective under the
Securities Act until the date which is 24 months from the Effectiveness Date
(subject to extension pursuant to the last paragraph of Section 5 hereof) (the
"Effectiveness Period"), or such shorter period ending when (i) all Transfer
Restricted Securities covered by the Initial Shelf Registration Statement have
been sold in the manner set forth and as contemplated in the Initial Shelf
Registration Statement, (ii) a Subsequent Shelf Registration Statement covering
all of the Transfer Restricted Securities has been declared effective under the
Securities Act or (iii) during any period in which all Transfer Restricted
Securities may be sold pursuant to Rule 144(k) under the Securities Act.
(b) Subsequent Shelf Registration Statements. If the Initial Shelf
----------------------------------------
Registration Statement or any Subsequent Shelf Registration Statement ceases to
be effective for any reason at any time during the Effectiveness Period (other
than because of the sale of all of the securities registered thereunder), Stater
Bros. shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 45 days of
such cessation of effectiveness amend the Shelf Registration Statement in a
manner reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Registration Statement pursuant to
Rule 415 covering all of the Transfer Restricted
7
Securities (a "Subsequent Shelf Registration Statement"). If a Subsequent Shelf
Registration Statement is filed, Stater Bros. shall use its best efforts to
cause the Subsequent Shelf Registration Statement to be declared effective as
soon as practicable after such filing and to keep such Registration Statement
continuously effective for a period equal to the number of days in the
Effectiveness Period less the aggregate number of days during which the Initial
Shelf Registration Statement or any Subsequent Shelf Registration Statement was
previously continuously effective. As used herein, the term "Shelf Registration
Statement" means the Initial Shelf Registration Statement and any Subsequent
Shelf Registration Statement.
(c) Supplements and Amendments. Stater Bros. shall promptly
--------------------------
supplement and amend the Shelf Registration Statement if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration Statement, if required by the Securities Act, or if requested
by the Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities covered by such Registration Statement or by any
underwriter of such Transfer Restricted Securities.
4. LIQUIDATED DAMAGES
------------------
(a) If (i) any Registration Statement required by this Agreement is
not filed with the Commission on or prior to the applicable filing deadline
specified for such filing, (ii) any such Registration Statement has not been
declared effective by the Commission on or prior to the date specified herein
for such effectiveness (the "Effectiveness Target Date"), (iii) the Exchange
Offer has not been consummated within 30 days of the Effectiveness Target Date
with respect to such Exchange Offer Registration Statement or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded immediately by a post-effective
amendment to such Registration Statement that cures such failure and that is
itself declared effective immediately (each such event referred to in clauses
(i) through (iv), a "Registration Default"), then Stater Bros. hereby agrees to
pay to each Holder of Transfer Restricted Securities affected thereby liquidated
damages (the "Liquidated Damages") in an amount equal to $.05 per week per
$1,000 in principal amount of Transfer Restricted Securities held by such Holder
for each week or portion thereof that the Registration Default continues for the
first 90-day period immediately following the occurrence of such Registration
Default. The amount of the Liquidated Damages shall increase by an additional
$.05 per week per $1,000 in principal amount of Transfer Restricted Securities
with respect to each subsequent 90-day period until all Registration Defaults
have been cured, up to a maximum amount of Liquidated Damages of $.50 per week
per $1,000 in principal amount of Transfer Restricted Securities; provided that
Stater Bros. shall in no event be required to pay Liquidated Damages for more
than one Registration Default at any given time. Notwithstanding anything to the
contrary set forth herein, (1) upon filing of the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement), in the case
of (i) above, (2) upon the effectiveness of the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement), in the case
of (ii) above, (3) upon Consummation of the Exchange Offer, in the case of (iii)
above, or (4)
8
upon the filing of a post-effective amendment to the Registration Statement or
an additional Registration Statement that causes the Exchange Offer Registration
Statement (and/or, if applicable, the Shelf Registration Statement) to again be
declared effective or made usable in the case of (iv) above, the Liquidated
Damages payable with respect to the Transfer Restricted Securities as a result
of such clause (i), (ii), (iii) or (iv), as applicable, shall cease.
(b) Stater Bros. shall notify the Trustee within one business day
after each and every date on which an event occurs in respect of which
Liquidated Damages are required to be paid (an "Event Date"). Liquidated Damages
shall be paid by depositing with the Trustee, in trust, for the benefit of the
Holders thereof, on or before the applicable semi-annual interest payment date,
immediately available funds in sums sufficient to pay the Liquidated Damages
then due to Holders of Notes with respect to which the Trustee serves. The
Liquidated Damages due shall be payable on each interest payment date to the
record Holder of Notes entitled to receive the interest payment to be paid on
such date as set forth in the Indenture. Each obligation to pay Liquidated
Damages shall be deemed to accrue on the applicable Event Date. The amount of
Liquidated Damages will be determined by multiplying the applicable Liquidated
Damages rate by the principal amount of the Notes, multiplied by a fraction, the
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numerator of which is the number of days such Liquidated Damages rate was
applicable during such period (determined on the basis of a 360-day year
comprised of twelve 30-day months), and the denominator of which is 360.
5. REGISTRATION PROCEDURES
-----------------------
In connection with the registration of any Transfer Restricted
Securities or Private Exchange Notes pursuant to Sections 2 or 3 hereof, Stater
Bros. shall effect such registrations to permit the sale of such Transfer
Restricted Securities or Private Exchange Notes in accordance with the intended
method or methods of disposition thereof, and, pursuant thereto, Stater Bros.
shall:
(a) Prepare and file with the Commission, as soon as practicable
after the date hereof but in any event prior to the Filing Date, a Registration
Statement or Registration Statements as prescribed by Section 2 or 3, and use
its best efforts to cause each such Registration Statement to become effective
and remain effective as provided herein; provided, that, if (1) such filing is
pursuant to Section 3, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, before filing any Registration
Statement or Prospectus or any amendments or supplements thereto, Stater Bros.
shall, if requested, furnish to and afford the Holders of the Transfer
Restricted Securities and each such Participating Broker-Dealer (the "Selling
Holders"), as the case may be, covered by such Registration Statement, one
special counsel for the Selling Holders (the "Holders Counsel") and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by reference
therein and all exhibits thereto) proposed to be filed (at least 5 business days
prior to such filing). Stater Bros. shall not file any Registration Statement or
Prospectus or any amendments or supplements thereto in respect of which the
Holders must be afforded an
9
opportunity to review prior to the filing of such document, if the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
covered by such Registration Statement, or such Participating Broker-Dealer, as
the case may be, the Holders Counsel, or the managing underwriters, if any,
shall reasonably object.
(b) Use its best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for the
period specified in Section 2 or 3 of this Agreement, as applicable. Upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain an untrue statement of material fact
or omit to state any material fact necessary to make the statements therein not
misleading or (B) not to be effective and usable for resale of Transfer
Restricted Securities during the period required by this Agreement, Stater Bros.
shall file promptly an appropriate amendment to such Registration Statement
curing such defect, and, if Commission review is required, use its best efforts
to cause such amendment to be declared effective as soon as practicable.
(c) Prepare and file with the Commission such amendments and post-
effective amendments to each Shelf Registration Statement or Exchange Offer
Registration Statement, as the case may be, as may be necessary to keep such
Registration Statement continuously effective for the Effectiveness Period or
the Applicable Period, as the case may be; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder applicable to it with respect to the disposition of all securities
covered by such Registration Statement as so amended or in such Prospectus as so
supplemented and with respect to the subsequent resale of any securities being
sold by a Participating Broker-Dealer covered by any such Prospectus. Stater
Bros. shall be deemed not to have used its best efforts to keep a Registration
Statement effective during the Applicable Period if it voluntarily takes any
action that would result in Selling Holders of the Transfer Restricted
Securities covered thereby or Participating Broker-Dealers seeking to sell
Exchange Notes not being able to sell such Transfer Restricted Securities or
such Exchange Notes during that period unless such action is required by
applicable law.
(d) If (1) a Shelf Registration Statement is filed pursuant to
Section 3, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, Stater Bros. shall notify the selling
Holders of Transfer Restricted Securities, or each such Participating Broker-
Dealer, as the case may be, the Holders Counsel and the managing underwriters,
if any, promptly (but in any event within two business days), and confirm such
notice in writing, (i) when a Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to a Registration
Statement or any post-effective amendment, when the same has become effective
(including in such notice a written statement that any Holder may, upon request,
obtain, without charge, one conformed copy of such Registration Statement or
post-effective amendment including financial statements and schedules, documents
incorporated or deemed to be incorporated by reference and
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exhibits), (ii) of the issuance by the Commission of any stop order suspending
the effectiveness of a Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus or the initiation of any
proceedings for that purpose, (iii) if at any time when a prospectus is required
by the Securities Act to be delivered in connection with sales of the Transfer
Restricted Securities the representations and warranties of Stater Bros.
contained in any agreement (including any underwriting agreement) contemplated
by Section 5(o) below cease to be true and correct, (iv) of the receipt by
Stater Bros. of any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration Statement or any
of the Transfer Restricted Securities or the Exchange Notes to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction, or the
initiation or threatening of any proceeding for such purpose, (v) of the
happening of any event or any information becoming known that makes any
statement made in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue
in any material respect or that requires the making of any changes in such
Registration Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and (vi) of Stater Bros.' reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.
(e) If (1) a Shelf Registration Statement is filed pursuant to
Section 3, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, use its best efforts to prevent the issuance
of any order suspending the effectiveness of a Registration Statement or of any
order preventing or suspending the use of a Prospectus or suspending the
qualification (or exemption from qualification) of any of the Transfer
Restricted Securities or the Exchange Notes to be sold by any Participating
Broker-Dealer, for sale in any jurisdiction, and, if any such order is issued,
to use its best efforts to obtain the withdrawal of any such order at the
earliest possible moment.
(f) If a Shelf Registration Statement is filed pursuant to Section 3
and if requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
being sold in connection with an underwritten offering, (i) promptly incorporate
in a prospectus supplement or post-effective amendment such information as the
managing underwriters, if any, or such Holders or counsel reasonably request to
be included therein, (ii) make all required filings of such prospectus
supplement or such post-effective amendment as soon as practicable after Stater
Bros. has received notification of the matters to be incorporated in such
prospectus supplement or post-effective amendment, and (iii) supplement or make
amendments to such Registration Statement.
(g) If (1) a Shelf Registration Statement is filed pursuant to
Section 3, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 is
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required to be delivered under the Securities Act by any Participating Broker-
Dealer who seeks to sell Exchange Notes during the Applicable Period, furnish to
each selling Holder of Transfer Restricted Securities and to each such
Participating Broker-Dealer who so requests and to the Holders Counsel and each
managing underwriter, if any, without charge, one conformed copy of the
Registration Statement or Registration Statements and each post-effective
amendment thereto, including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be incorporated therein by
reference and all exhibits.
(h) If (1) a Shelf Registration Statement is filed pursuant to Section
3, or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the Securities Act
by any Participating Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period, deliver to each selling Holder of Transfer Restricted
Securities or each such Participating Broker-Dealer, as the case may be, their
counsel, and the underwriters, if any, without charge, as many copies of the
Prospectus or Prospectuses (including each form of preliminary prospectus) and
each amendment or supplement thereto and any documents incorporated by reference
therein as such Persons may reasonably request; and, subject to the last
paragraph of this Section 5, Stater Bros. hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders of Transfer Restricted Securities or each such Participating Broker-
Dealer, as the case may be, and the underwriters or agents, if any, and dealers
(if any), in connection with the offering and sale of the Transfer Restricted
Securities covered by or the sale by Participating Broker-Dealers of the
Exchange Notes pursuant to such Prospectus and any amendment or supplement
thereto.
(i) Prior to any public offering of Transfer Restricted Securities or
any delivery of a Prospectus contained in the Exchange Offer Registration
Statement by any Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, to use its best efforts to register or qualify,
and to cooperate with the selling Holders of Transfer Restricted Securities or
each such Participating Broker-Dealer, as the case may be, the underwriters, if
any, and their respective counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Transfer Restricted Securities for offer and sale under the securities or Blue
Sky laws of such jurisdictions within the United States as any selling Holder,
Participating Broker-Dealer, or the managing underwriters reasonably request in
writing; provided, that where Exchange Notes held by Participating Broker-
Dealers or Transfer Restricted Securities are offered other than through an
underwritten offering, Stater Bros. agrees to cause its counsel to perform Blue
Sky investigations and file registrations and qualifications required to be
filed pursuant to this Section 5(i); keep each such registration or
qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all other
acts or things reasonably necessary or advisable to enable the disposition in
such jurisdictions of the Exchange Notes held by Participating Broker-Dealers or
the Transfer Restricted Securities covered by the applicable Registration
Statement; provided, further, that Stater Bros. shall not be required to (A)
qualify generally to do business in any jurisdiction where it is not then so
qualified, (B) take any action that would subject it to general service of
process in any such jurisdiction where it is not then so subject or (C) subject
itself to taxation in excess of a nominal dollar amount in any such
jurisdiction.
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(j) If a Shelf Registration Statement is filed pursuant to Section 3,
cooperate with the selling Holders of Transfer Restricted Securities and the
managing underwriters, if any, to facilitate the timely preparation and delivery
of certificates representing Transfer Restricted Securities to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company; and enable such Transfer
Restricted Securities to be in such denominations and registered in such names
as the managing underwriters, if any, or Holders may reasonably request.
(k) Use its best efforts to cause the Transfer Restricted Securities
covered by the Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable the
seller or sellers thereof or the underwriters, if any, to consummate the
disposition of such Transfer Restricted Securities, except as may be required
solely as a consequence of the nature of such selling Holder's business, in
which case Stater Bros. will cooperate in all reasonable respects with the
filing of such Registration Statement and the granting of such approvals.
(l) If (1) a Shelf Registration Statement is filed pursuant to
Section 3, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, upon the occurrence of any event
contemplated by paragraph 5(d)(v) or 5(d)(vi) above, as promptly as practicable
prepare and (subject to Section 5(a) above) file with the Commission, at the
expense of Stater Bros., a supplement or post-effective amendment to the
Registration Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, or file any
other required document so that, as thereafter delivered to the purchasers of
the Transfer Restricted Securities being sold thereunder or to the purchasers of
the Exchange Notes to whom such Prospectus will be delivered by a Participating
Broker-Dealer any such Prospectus will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(m) Use its best efforts to cause the Transfer Restricted Securities
covered by a Registration Statement or the Exchange Notes, as the case may be,
to be rated with the appropriate rating agencies, if so requested by the Holders
of a majority in aggregate principal amount of Transfer Restricted Securities
covered by such Registration Statement or the Exchange Notes, as the case may
be, or the managing underwriters, if any.
(n) Prior to the effective date of the first Registration Statement
relating to the Transfer Restricted Securities, (i) provide the Trustee with
printed certificates for the Transfer Restricted Securities in a form eligible
for deposit with The Depository Trust Company and (ii) provide a CUSIP number
for the Transfer Restricted Securities.
(o) In the event of an underwritten offering of Transfer Restricted
Securities pursuant to a Shelf Registration Statement, enter into an
underwriting agreement as is customary in underwritten offerings and take all
such other actions as are reasonably requested by the
13
managing underwriters in order to expedite or facilitate the registration or the
disposition of such Transfer Restricted Securities, and in such connection, (i)
make such representations and warranties to the underwriters, with respect to
the business of Stater Bros. and its subsidiaries and the Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are customarily made by
issuers to underwriters in underwritten offerings, and confirm the same if and
when requested; (ii) obtain opinions of counsel to Stater Bros. and updates
thereof in form and substance reasonably satisfactory to the managing
underwriters, addressed to the underwriters covering the matters customarily
covered in opinions requested in underwritten offerings and such other matters
as may be reasonably requested by underwriters; (iii) obtain "cold comfort"
letters and updates thereof in form and substance reasonably satisfactory to the
managing underwriters from the independent certified public accountants of
Stater Bros. (and, if necessary, any other independent certified public
accountants of any subsidiary of Stater Bros. or of any business acquired by
Stater Bros. for which financial statements and financial data are, or are
required to be, included in the Registration Statement), addressed to each of
the underwriters, such letters to be in customary form and covering matters of
the type customarily covered in "cold comfort" letters in connection with
underwritten offerings and such other matters as reasonably requested by
underwriters; and (iv) if an underwriting agreement is entered into, the same
shall contain indemnification provisions and procedures no less favorable than
those set forth in Section 7 hereof (or such other provisions and procedures
acceptable to Holders of a majority in aggregate principal amount of Transfer
Restricted Securities covered by such Registration Statement and the managing
underwriters or agents) with respect to all parties to be indemnified pursuant
to said Section. The above shall be done at each closing under such underwriting
agreement, or as and to the extent required thereunder.
(p) If (1) a Shelf Registration Statement is filed pursuant to
Section 3, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, make available for inspection by any selling
Holder of such Transfer Restricted Securities being sold, or each such
Participating Broker-Dealer, as the case may be, any underwriter participating
in any such disposition of Transfer Restricted Securities, if any, and any
attorney, accountant or other agent retained by any such selling Holder or each
such Participating Broker-Dealer, as the case may be, or underwriter
(collectively, the "Inspectors"), at the offices where normally kept, during
reasonable business hours, all financial and other records, pertinent corporate
documents and properties of Stater Bros. and its subsidiaries (collectively, the
"Records") as shall be reasonably necessary to enable them to exercise any
applicable due diligence responsibilities, and cause the officers, directors and
employees of Stater Bros. and its subsidiaries to supply all information in each
case reasonably requested by any such Inspector in connection with such
Registration Statement. Records which Stater Bros. determines, in good faith, to
be confidential and any Records which it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the disclosure
of such Records is necessary to avoid or correct a misstatement or omission in
such Registration Statement, (ii) the release of such Records is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction or
(iii) the information in such Records has been made generally available to the
public. Each selling Holder of such Transfer Restricted
14
Securities and each such Participating Broker-Dealer will be required to agree
that information obtained by it as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of Stater Bros. unless and until such is made
generally available to the public. Each selling Holder of such Transfer
Restricted Securities and each such Participating Broker-Dealer will be required
to further agree that it will, upon learning that disclosure of such Records is
sought in a court of competent jurisdiction, give notice to Stater Bros. and
allow Stater Bros. to undertake appropriate action to prevent disclosure of the
Records deemed confidential at their expense.
(q) Provide an indenture trustee for the Transfer Restricted
Securities or the Exchange Notes, as the case may be, and cause the Indenture or
the trust indenture provided for in Section 2(a), as the case may be, to be
qualified under the TIA not later than the effective date of the Exchange Offer
or the first Registration Statement relating to the Transfer Restricted
Securities; and in connection therewith, cooperate with the trustee under any
such indenture and the Holders of the Transfer Restricted Securities, to effect
such changes to such indenture as may be required for such indenture to be so
qualified in accordance with the terms of the TIA; and execute, and use its best
efforts to cause such trustee to execute, all documents as may be required to
effect such changes, and all other forms and documents required to be filed with
the Commission to enable such indenture to be so qualified in a timely manner.
(r) Comply with all applicable rules and regulations of the
Commission and make generally available to its securityholders earnings
statements satisfying the provisions of Section 1 l(a) of the Securities Act and
Rule 158 thereunder (or any similar rule promulgated under the Securities Act)
no later than 45 days after the end of any 12-month period (or 90 days after the
end of any 12-month period if such period is a fiscal year) (i) commencing at
the end of any fiscal quarter in which Transfer Restricted Securities are sold
to underwriters in a firm commitment or best efforts underwritten offering and
(ii) if not sold to underwriters in such an offering, commencing on the first
day of the first fiscal quarter of Stater Bros. after the effective date of a
Registration Statement, which statements shall cover said 12-month periods.
(s) Upon consummation of an Exchange Offer or a Private Exchange,
obtain an opinion of counsel to Stater Bros. addressed to the Trustee for the
benefit of all Holders of Transfer Restricted Securities participating in the
Exchange Offer or the Private Exchange, as the case may be, and which includes
an opinion that (i) Stater Bros. has duly authorized, executed and delivered the
Exchange Notes and Private Exchange Notes and the related indenture, and (ii)
each of the Exchange Notes or the Private Exchange Notes, as the case may be,
and related indenture constitute a legal, valid and binding obligation of Stater
Bros., enforceable against Stater Bros. in accordance with its respective terms
(with customary exceptions).
(t) If an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Transfer Restricted Securities by Holders to Stater Bros.
(or to such other Person as directed by Stater Bros.) in exchange for the
Exchange Notes or the Private Exchange Notes, as the case may be, Stater Bros.
shall xxxx, or cause to be marked, on such Transfer Restricted Securities that
such Transfer Restricted Securities are being cancelled in exchange for the
15
Exchange Notes or the Private Exchange Notes, as the case may be; in no event
shall such Transfer Restricted Securities be marked as paid or otherwise
satisfied.
(u) Cooperate with each seller of Transfer Restricted Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Transfer Restricted Securities and
their respective counsel in connection with any filings required to be made with
the National Association of Securities Dealers, Inc. (the "NASD").
(v) Use its best efforts to take all other steps necessary to effect
the registration of the Transfer Restricted Securities covered by a Registration
Statement contemplated hereby.
(w) If, following the date hereof there has been announced a change
in Commission policy with respect to exchange offers such as the Exchange Offer,
that in the reasonable opinion of counsel to Stater Bros. raises a substantial
question as to whether the Exchange Offer is permitted by applicable federal
law, seek a no-action letter or other favorable decision from the Commission
allowing Stater Bros. to Consummate an Exchange Offer for such Transfer
Restricted Securities. Stater Bros. hereby agrees to pursue the issuance of such
a decision to the Commission staff level. In connection with the foregoing,
Stater Bros. hereby agrees to take all such other actions as may be requested by
the Commission or otherwise required in connection with the issuance of such
decision, including without limitation (A) participating in telephonic
conferences with the Commission, (B) delivering to the Commission staff an
analysis prepared by counsel to Stater Bros. setting forth the legal bases, if
any, upon which such counsel has concluded that such an Exchange Offer should be
permitted and (C) diligently pursuing a resolution (which need not be favorable)
by the Commission staff.
Stater Bros. may require each seller of Transfer Restricted Securities
or Participating Broker-Dealer as to which any registration is being effected to
furnish to Stater Bros. such information regarding such seller or Participating
Broker-Dealer and the distribution of such Transfer Restricted Securities or
Exchange Notes to be sold by such Participating Broker-Dealer, as the case may
be, as Stater Bros. may, from time to time, reasonably request including,
without limitation, a written representation to Stater Bros. (which may be
contained in the letter of transmittal contemplated by the Exchange Offer
Registration Statement or Shelf Registration Statement, as applicable) stating
that (A) it is not an affiliate of Stater Bros., (B) the amount of Transfer
Restricted Securities held by such Holder prior to the Exchange Offer, (C) the
amount of Transfer Restricted Securities owned by such Holder to be exchanged in
the Exchange Offer and representing that such Holder is not engaged in, and does
not intend to engage in, and has no arrangement or understanding with any Person
to participate in, a distribution of the Exchange Notes to be issued and (D) it
is acquiring the Exchange Notes in its ordinary course of business. Stater
Bros. may exclude from such registration the Transfer Restricted Securities of
any seller or Participating Broker-Dealer who unreasonably fails to furnish such
information within a reasonable time after receiving such request.
Each Holder of Transfer Restricted Securities and each Participating
Broker-Dealer agrees by acquisition of such Transfer Restricted Securities or
Exchange Notes to be sold by such Participating Broker-Dealer, as the case may
be, that, upon receipt of any notice from
16
Stater Bros. of the happening of any event of the kind described in Section
5(d)(ii), 5(d)(iv), 5(d)(v), or 5(d)(vi), such Holder will forthwith discontinue
disposition of such Transfer Restricted Securities covered by such Registration
Statement or Prospectus or Exchange Notes to be sold by such Participating
Broker-Dealer, as the case may be, until such Holder's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 5(l), or until it
is advised in writing (the "Advice") by Stater Bros. that the use of the
applicable Prospectus may be resumed, and has received copies of any amendments
or supplements thereto. In the event Stater Bros. shall give any such notice,
each of the Effectiveness Period and the Applicable Period shall be extended by
the number of days during such periods from and including the date of the giving
of such notice to and including the date when each seller of Transfer Restricted
Securities covered by such Registration Statement or Exchange Notes to be sold
by such Participating Broker-Dealer, as the case may be, shall have received (x)
the copies of the supplemented or amended Prospectus contemplated by Section
5(l) or (y) the Advice.
6. REGISTRATION EXPENSES
---------------------
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by Stater Bros. shall be borne by Stater Bros.,
whether or not the Exchange Offer or a Shelf Registration Statement is filed or
becomes effective, including, without limitation, (i) all registration and
filing fees (including, without limitation, (A) fees with respect to filings
required to be made with the NASD in connection with an underwritten offering
and (B) fees and expenses of compliance with state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements of its counsel
in connection with Blue Sky qualifications of the Transfer Restricted Securities
or Exchange Notes and determination of the eligibility of the Transfer
Restricted Securities or Exchange Notes for investment under the laws of such
jurisdictions (x) where the Holders of Transfer Restricted Securities are
located, in the case of the Exchange Notes, or (y) as provided in Section 5(i),
in the case of Transfer Restricted Securities or Exchange Notes to be sold by a
Participating Broker-Dealer during the Applicable Period)), (ii) printing
expenses (including, without limitation, expenses (A) of printing certificates
for the Notes in a form eligible for deposit with The Depository Trust Company
and (B) of printing prospectuses if the printing of prospectuses is requested by
(I) the managing underwriters, if any, or, (II) in respect of Notes to be sold
by any Participating Broker-Dealer during the Applicable Period, by the Holders
of a majority in aggregate principal amount of the Notes included in any
Registration Statement), (iii) messenger, telephone and delivery expenses, (iv)
fees and disbursements of counsel for Stater Bros. and fees and disbursements of
the Holders Counsel (subject to the provisions of Section 6(b)), (v) fees and
all independent certified public accountants referred to in Section 5(o)(iii)
(including, without limitation, the expenses of any special audit and cold
comfort" letters required by or incident to such performance), (vi) the fees and
expenses of any "qualified independent underwriter" or other independent
appraiser participating in an offering pursuant to the rules and regulations of
the NASD, (vii) rating agency fees, (viii) Securities Act liability insurance,
if Stater Bros. desires such insurance, (ix) fees and expenses of all other
Persons retained by Stater Bros., (x) internal expenses of Stater Bros.
(including, without limitation, all salaries and expenses of officers and
employees of Stater Bros. performing legal or accounting duties), (xi) the
expense of any annual or special audit, (xii) the fees and expenses incurred in
connection with the listing of the securities to be registered on any
17
securities exchange and (xiii) the expenses relating to printing, word
processing and distributing all Registration Statements, underwriting
agreements, securities sales agreements, indentures and any other documents
necessary in order to comply with this Agreement.
(b) In connection with any Shelf Registration Statement hereunder,
Stater Bros. shall reimburse the Holders of the Transfer Restricted Securities
being registered in such registration for the fees and disbursements of the
Holders' Counsel (in addition to appropriate local counsel) chosen by the
Holders of a majority in aggregate principal amount of the Transfer Restricted
Securities to be included in such Registration Statement and other out-of-pocket
expenses of the Holders of Transfer Restricted Securities incurred in connection
with the registration of the Transfer Restricted Securities.
7. INDEMNIFICATION
---------------
(a) Stater Bros. will indemnify and hold harmless each Holder of
Transfer Restricted Securities and each Participating Broker-Dealer selling
Exchange Notes during the Applicable Period, the directors, officers, employees
and agents of each person, and each person, if any, who controls any such person
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act (each a "Participant") from and against any and all losses, claims,
liabilities, expenses and damages (including any and all investigative, legal
and other expenses reasonably incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claim asserted), to
which they, or any of them, may become subject under the Securities Act, the
Exchange Act or other Federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, liabilities, expenses or
damages arise out of or are based on any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
Prospectus or any amendment or supplement thereto or any preliminary prospectus
or the omission or alleged omission to state in such document a material fact
required to be stated in it or necessary to make the statements in it not
misleading; provided, that a Participant will not be entitled to any such
indemnification hereunder to the extent that such loss, claim, liability,
expense or damage arises from and is based on an untrue statement or omission or
alleged untrue statement or omission made in reliance on and in conformity with
information relating to such Participant furnished in writing to Stater Bros. by
such Participant expressly for inclusion therein or in the case of a
Participating Broker-Dealer, if the person asserting any such loss, claim,
liability, expense or damage purchased the Exchange Notes from such
Participating Broker-Dealer but was not sent or given a copy of the Prospectus
at or prior to the written confirmation of the sale of Exchange Notes to such
person and such untrue statement or omission or alleged untrue statement or
omission was cured in the Prospectus.
(b) Each Participant will indemnify and hold harmless Stater Bros.,
each person, if any, who controls Stater Bros. within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act, each director of Stater
Bros. and each officer of Stater Bros. to the same extent as the foregoing
indemnity from Stater Bros. to each Participant, but only insofar as losses,
claims, liabilities, expenses or damages arise out of or are based on any untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with
18
information relating to such Participant furnished in writing to Stater Bros. by
such Participant expressly for use in any Registration Statement or Prospectus
or any amendment or supplement thereto or any preliminary prospectus. The
liability of any Participant under this paragraph shall in no event exceed the
proceeds received by such Participant from sales of Transfer Restricted
Securities giving rise to such obligations.
(c) Any party that proposes to assert the right to be indemnified
under this Section 7 will, promptly after receipt of notice of commencement of
any action against such party in respect of which a claim is to be made against
an indemnifying party or parties under this Section 7, notify each such
indemnifying party of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify such indemnifying party will not
relieve it from any liability that it may have to any indemnified party under
the foregoing provisions of this Section 7 unless, and only to the extent that,
such omission results in the forfeiture of substantive rights or defenses by the
indemnifying party. If any such action is brought against any indemnified party
and it notifies the indemnifying party of its commencement, the indemnifying
party will be entitled to participate in and, to the extent that it elects by
delivering written notice to the indemnified party promptly after receiving
notice of the commencement of the action from the indemnified party, jointly
with any other indemnifying party similarly notified, to assume the defense of
the action, with counsel satisfactory to the indemnified party, and after notice
from the indemnifying party to the indemnified party of its election to assume
the defense, the indemnifying party will not be liable to the indemnified party
for any legal or other expenses except as provided below and except for the
reasonable costs of investigation subsequently incurred by the indemnified party
in connection with the defense. The indemnified party will have the right to
employ its own counsel in any such action, but the fees, expenses and other
charges of such counsel will be at the expense of such indemnified party unless
(1) the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based on advice of counsel) that there may be legal defenses
available to it or other indemnified parties that are different from or in
addition to those available to the indemnifying party, (3) a conflict or
potential conflict exists (based on advice of counsel to the indemnified party)
between the indemnified party and the indemnifying party (in which case the
indemnifying party will not have the right to direct the defense of such action
on behalf of the indemnified party) or (4) the indemnifying party has not in
fact employed counsel to assume the defense of such action within a reasonable
time after receiving notice of the commencement of the action, in each of which
cases the reasonable fees, disbursements and other charges of counsel will be at
the expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm admitted to
practice in such jurisdiction at any one time for all such indemnified party or
parties. All such fees, disbursements and other charges will be reimbursed by
the indemnifying party promptly as they are incurred. An indemnifying party will
not be liable for any settlement of any action or claim effected without its
written consent (which consent will not be unreasonably withheld).
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 7 is applicable
19
in accordance with its terms but for any reason is held to be unavailable from
Stater Bros. or any Participant, Stater Bros. and each Participant will
contribute to the total losses, claims, liabilities, expenses and damages
(including any investigative, legal and other expenses reasonably incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted, but after deducting any contribution received
by Stater Bros. from persons other than a Participant, such as persons who
control Stater Bros. within the meaning of the Securities Act, officers of
Stater Bros. and directors of Stater Bros., who also may be liable for
contribution) to which Stater Bros. and each Participant may be subject in such
proportion as is appropriate to reflect the relative benefits received by Stater
Bros. on the one hand and each Participant on the other. The relative benefits
received by Stater Bros. on the one hand and each Participant on the other shall
be deemed to be equal to (i) with respect to Stater Bros., the total net
proceeds from the initial offering (before deducting expenses) received by
Stater Bros., (ii) with respect to the initial purchaser in such offering, the
total purchase discount and commissions, (iii) with respect to any other Holder
of Transfer Restricted Securities, the value of such Notes and (iv) with respect
to any underwriter, the total underwriting discounts and commissions with
respect to such underwriting, in each case of clauses (i), (ii) or (iv), as set
forth on the cover page of the applicable offering memorandum or prospectus. If,
but only if, the allocation provided by the foregoing sentence is not permitted
by applicable law, the allocation of contribution shall be made in such
proportion as is appropriate to reflect not only the relative benefits referred
to in the foregoing sentence but also the relative fault of Stater Bros. on the
one hand and each Participant on the other, with respect to the statements or
omissions which resulted in such loss, claim, liability, expense or damage, or
action in respect thereof, as well as any other relevant equitable
considerations with respect to such offering. Such relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by Stater Bros. or a Participant, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. Stater Bros. and each Participant
shall agree that it would not be just and equitable if contributions pursuant to
this Section 7(d) were to be determined by pro rata allocation or by any other
method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, liability, expense or damage, or action in
respect thereof, referred to above in this Section 7(d) shall be deemed to
include, for purpose of this Section 7(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 7(d), a Participant shall not be required to contribute any amount in
excess of the amount by which proceeds received by such Participant from sales
of Transfer Restricted Securities exceeds the amount of any damages that such
Participant has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, and no person found
guilty of fraudulent misrepresentation (within the meaning of Section 11 (f) of
the Securities Act) will be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 7(d),
any person who controls a party to this Agreement within the meaning of the
Securities Act will have the same rights to contribution as that party, and each
officer of Stater Bros. will have the same rights to contribution as Stater
Bros., subject in each case to the provisions hereof. Any party entitled to
contribution, promptly after receipt of notice
20
of commencement of any action against such party in respect of which a claim for
contribution may be made under this Section 7(d), will notify any such party or
parties from whom contribution may be sought, but the omission so to notify will
not relieve the party or parties from whom contribution may be sought from any
other obligation it or they may have under this Section 7(d). No party will be
liable for contribution with respect to any action or claim settled without its
written consent (which consent will not be unreasonably withheld).
(e) The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the indemnifying persons
may otherwise have to the indemnified persons referred to above.
8. RULES 144 AND 144A
------------------
Stater Bros. covenants that it will file the reports required to be
filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the Commission thereunder in a timely manner and, if at
any time Stater Bros. is not required to file such reports, it will, upon the
request of any Holder of Transfer Restricted Securities, make publicly available
other information so long as necessary to permit sales pursuant to Rule 144 and
Rule 144A under the Securities Act. Stater Bros. further covenants that it will
take such further action as any Holder of Transfer Restricted Securities may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Transfer Restricted Securities without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule 144
and Rule 144A under the Securities Act, as such Rules may be amended from time
to time, or (b) any similar rule or regulation hereafter adopted by the
Commission.
9. UNDERWRITTEN REGISTRATIONS
--------------------------
If any of the Transfer Restricted Securities covered by any Shelf
Registration Statement are to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers that will manage
the offering will be selected by the Holders of a majority in aggregate
principal amount of such Transfer Restricted Securities included in such
offering and reasonably acceptable to Stater Bros.
No Holder of Transfer Restricted Securities may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell such
Holder's Transfer Restricted Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
10. MISCELLANEOUS
-------------
(a) Remedies. In the event of a breach by Stater Bros. of any of its
--------
obligations under this Agreement, each Holder of Transfer Restricted Securities,
in addition to being entitled to exercise all rights provided herein, in the
Indenture or, in the case of the Initial Purchaser, in the Purchase Agreement or
granted by law, including recovery of damages, will be entitled to
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specific performance of its rights under this Agreement. Stater Bros. agrees
that monetary damages would not be adequate compensation for any loss incurred
by reason of a breach by it of any of the provisions of this Agreement and
hereby further agrees that, in the event of any action for specific performance
in respect of such breach, it shall waive the defense that a remedy at law would
be adequate.
(b) No Inconsistent Agreements. Stater Bros. has not, as of the date
--------------------------
hereof, and Stater Bros. shall not, after the date of this Agreement, enter into
any agreement with respect to any of its securities that is inconsistent with
the rights granted to the Holders of Transfer Restricted Securities in this
Agreement or otherwise conflicts with the provisions hereof. Stater Bros. has
not entered or will not enter into any agreement with respect to any of its
securities which will grant to any Person piggy-back rights with respect to a
Registration Statement.
(c) Adjustments Affecting Transfer Restricted Securities. Stater
----------------------------------------------------
Bros. shall not, directly or indirectly, take any action with respect to the
Transfer Restricted Securities as a class that would adversely affect the
ability of the Holders of Transfer Restricted Securities to include such
Transfer Restricted Securities in a registration undertaken pursuant to this
Agreement.
(d) Amendments and Waivers. The provisions of this Agreement,
----------------------
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless Stater Bros. has obtained the written consent of
Holders of at least a majority of the then outstanding aggregate principal
amount of Transfer Restricted Securities. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders of Transfer Restricted
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect, impair, limit or compromise the
rights of other Holders of Transfer Restricted Securities may be given by
Holders of at least a majority in aggregate principal amount of the Transfer
Restricted Securities being sold by such Holders pursuant to such Registration
Statement; provided, that the provisions of this sentence may not be amended,
modified or supplemented except in accordance with the provisions of the
immediately preceding sentence.
(e) Notices. All notices and other communications (including without
-------
limitation any notices or other communications to the Trustee) provided for or
permitted hereunder shall be made in writing by hand-delivery, registered first-
class mail, next-day air courier or telecopier.
(i) if to a Holder of Transfer Restricted Securities, at the most
current address given by the Trustee to Stater Bros.; and
(ii) if to Stater Bros., at:
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Chief Executive Officer
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with copies to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Telecopy No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
and
Varner, Saleson, & Xxxxxx LLP
0000 Xxxxxxxxxx Xxxxxx Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
All such notices and communications shall be deemed to have been duty
given: when delivered by hand, if personally delivered; five business days after
being deposited in the postage prepaid, if mailed; one business day after being
timely delivered to a next-day air courier; and when receipt is acknowledged by
the addressee, if telecopied.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the trustee under the
Indenture at the address specified in such Indenture.
(f) Successors and Assigns. This Agreement shall inure to the benefit
----------------------
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; provided, that with
respect to the indemnity and contribution agreements in Section 7, each Holder
of Transfer Restricted Securities subsequent to the Initial Purchasers shall be
bound by the terms thereof if (i) such Holder elects to include Transfer
Restricted Securities in a Shelf Registration Statement and (ii) such Holder is
advised expressly by Stater Bros. of the provisions contained in Section 7 and
that such Holder's election to include Transfer Restricted Securities in a Shelf
Registration Statement shall be deemed such Holder's agreement to be bound by
such provisions.
(g) Counterparts. This Agreement may be executed in any number of
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not limit or otherwise affect the meaning hereof.
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(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(j) Severability. If any term, provision, covenant or restriction of
------------
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ ah alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
(k) Entire Agreement. This Agreement, together with the Purchase
----------------
Agreement and the Indenture, is intended by the parties as a final expression of
their agreement, and is intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein.
(l) Notes Held by Stater Bros. or Its Affiliates. Whenever the
--------------------------------------------
consent or approval of Holders of a specified percentage of Transfer Restricted
Securities is required hereunder, Transfer Restricted Securities held by Stater
Bros. or its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
STATER BROS. HOLDINGS INC.
BY: /s/ Xxxx X. Xxxxx
------------------------------
Xxxx X. Xxxxx
Chairman of The Board, President
and Chief Executive Officer
BY: /s/ Xxxxx X.Xxxxxx
------------------------------
Xxxxx X.Xxxxxx
Secretary
BANC OF AMERICA SECURITIES LLC
BY: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Xxxxx X. Xxxxxxxx
Managing Director
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