EXHIBIT 4.6
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STATER BROS. HOLDINGS INC.
SERIES A AND SERIES B
10 3/4% SENIOR NOTES DUE 2006
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INDENTURE
Dated as of August 6, 1999
________________________
IBJ WHITEHALL BANK & TRUST COMPANY
Trustee
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_______________________________________________________________________________
CROSS-REFERENCE TABLE*
Act Section Indenture Section
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310 (a)(1).................................................... 7.10
(a)(2)........................................................ 7.10
(a)(3)........................................................ N.A.
(a)(4)........................................................ N.A.
(a)(5)........................................................ 7.10
(b)........................................................... 7.10
(c)........................................................... N.A.
311(a)........................................................ 7.11
(b)........................................................... 7.11
(c)........................................................... N.A.
312 (a)....................................................... 2.05
(b)........................................................... 10.03
(c)........................................................... 10.03
313(a)........................................................ 7.06
(b)(2)........................................................ 7.07
(c)........................................................... 7.06;
10.02
(d)........................................................... 7.06
314(a)........................................................ 4.03;
10.02
(c)(1)........................................................ 10.04
(c)(2)........................................................ 10.04
(c)(3)........................................................ N.A.
(e)........................................................... 10.05
(f)........................................................... NA
315 (a)....................................................... 7.01
(b)........................................................... 7.05,
10.02
(c)........................................................... 7.01
(d)........................................................... 7.01
(e)........................................................... 6.11
316 (a)(last sentence)........................................ 2.09
(a)(1)(A)..................................................... 6.05
(a)(1)(B)..................................................... 6.04
(a)(2)........................................................ N.A.
(b)........................................................... 6.07
(c)........................................................... 2.12
317 (a)(1).................................................... 6.08
(a)(2)........................................................ 6.09
(b)........................................................... 2.04
318 (a)....................................................... 10.01
(b)........................................................... N.A.
(c)........................................................... 10.01
N.A. means not applicable.
*This Cross-Reference Table is not part of this Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE.......................................................... 1
Section 1.01. Definitions..................................................................................... 1
Section 1.02. Other Definitions............................................................................... 19
Section 1.03. Trust Indenture Act Definitions................................................................. 19
Section 1.04. Rules of Construction........................................................................... 20
ARTICLE 2. THE NOTES............................................................................................. 20
Section 2.01. Form and Dating................................................................................. 20
Section 2.02. Execution and Authentication.................................................................... 21
Section 2.03. Registrar and Paying Agent...................................................................... 22
Section 2.04. Paying Agent to Hold Money in Trust............................................................. 22
Section 2.05. Holder Lists.................................................................................... 23
Section 2.06. Transfer and Exchange........................................................................... 23
Section 2.07. Replacement Notes............................................................................... 34
Section 2.08. Outstanding Notes............................................................................... 34
Section 2.09. Treasury Notes.................................................................................. 35
Section 2.10. Temporary Notes................................................................................. 35
Section 2.11. Cancellation.................................................................................... 35
Section 2.12. Defaulted Interest.............................................................................. 35
Section 2.13. CUSIP Numbers................................................................................... 36
ARTICLE 3. REDEMPTION AND PREPAYMENT............................................................................. 36
Section 3.01. Notices to Trustee.............................................................................. 36
Section 3.02. Selection of Notes to Be Redeemed............................................................... 36
Section 3.03. Notice of Redemption............................................................................ 37
Section 3.04. Effect of Notice of Redemption.................................................................. 37
Section 3.05. Deposit of Redemption Price..................................................................... 37
Section 3.06. Notes Redeemed in Part.......................................................................... 38
Section 3.07. Optional Redemption............................................................................. 38
Section 3.08. Mandatory Redemption............................................................................ 39
Section 3.09. Offer to Purchase by Application of Excess Proceeds............................................. 39
ARTICLE 4. COVENANTS............................................................................................ 40
Section 4.01. Payment of Notes................................................................................ 40
Section 4.02. Maintenance of Office or Agency................................................................. 41
Section 4.03. Reports......................................................................................... 41
Section 4.04. Compliance Certificate.......................................................................... 42
Section 4.05. Taxes........................................................................................... 43
Section 4.06. Stay, Extension and Usury Laws.................................................................. 43
Section 4.07. Restricted Payments............................................................................. 43
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Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.................................. 46
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock...................................... 47
Section 4.10. Asset Sales..................................................................................... 50
Section 4.11. Transactions with Affiliates.................................................................... 52
Section 4.12. Liens........................................................................................... 52
Section 4.13. Corporate Existence............................................................................. 52
Section 4.14. Offer to Repurchase Upon Change of Control...................................................... 53
Section 4.15. Limitation On Issuances And Sales Of Equity Interests In Wholly-Owned Subsidiaries (Other Than
An Unrestricted Subsidiary)..................................................................... 54
Section 4.16. Limitation on Issuances of Guarantees of Indebtedness........................................... 54
Section 4.17. Designation of Restricted and Unrestricted Subsidiaries......................................... 54
Section 4.18. Payments For Consent............................................................................ 55
ARTICLE 5. SUCCESSORS............................................................................................ 55
Section 5.01. Xxxxxx, Consolidation, or Sale of Assets........................................................ 55
Section 5.02. Successor Corporation Substituted............................................................... 56
ARTICLE 6. DEFAULTS AND REMEDIES................................................................................. 56
Section 6.01. Events of Default............................................................................... 56
Section 6.02. Acceleration.................................................................................... 57
Section 6.03. Other Remedies.................................................................................. 58
Section 6.04. Waiver of Past Defaults......................................................................... 58
Section 6.05. Control by Majority............................................................................. 59
Section 6.06. Limitation on Suits............................................................................. 59
Section 6.07. Rights of Holders of Notes to Receive Payment................................................... 59
Section 6.08. Collection Suit by Trustee...................................................................... 59
Section 6.09. Trustee May File Proofs of Claim................................................................ 59
Section 6.10. Priorities...................................................................................... 60
Section 6.11. Undertaking for Costs........................................................................... 60
ARTICLE 7. TRUSTEE............................................................................................... 61
Section 7.01. Duties of Trustee............................................................................... 61
Section 7.02. Rights of Trustee............................................................................... 62
Section 7.03. Individual Rights of Trustee.................................................................... 62
Section 7.04. Trustee's Disclaimer............................................................................ 62
Section 7.05. Notice of Defaults.............................................................................. 63
Section 7.06. Reports by Trustee to Holders of the Notes...................................................... 63
Section 7.07. Compensation and Indemnity...................................................................... 63
Section 7.08. Replacement of Trustee.......................................................................... 64
Section 7.09. Successor Trustee by Xxxxxx, etc................................................................ 65
Section 7.10. Eligibility; Disqualification................................................................... 65
Section 7.11. Preferential Collection of Claims Against Stater Bros........................................... 66
Section 7.12. Trustee Risk.................................................................................... 66
Section 7.13. Appointment Of Co-Trustee....................................................................... 66
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ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE................................................................ 67
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.......................................... 67
Section 8.02. Legal Defeasance and Discharge.................................................................... 67
Section 8.03. Covenant Defeasance............................................................................... 67
Section 8.04. Conditions to Legal or Covenant Defeasance........................................................ 68
Section 8.05. Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions..... 69
Section 8.06. Repayment to Stater Bros.......................................................................... 70
Section 8.07. Reinstatement..................................................................................... 70
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER........................................................................ 70
Section 9.01. Without Consent of Holders of Notes............................................................... 70
Section 9.02. With Consent of Holders of Notes.................................................................. 71
Section 9.03. Compliance with Trust Indenture Act............................................................... 72
Section 9.04. Revocation and Effect of Consents................................................................. 72
Section 9.05. Notation on or Exchange of Notes.................................................................. 72
Section 9.06. Trustee to Sign Amendments, etc................................................................... 73
ARTICLE 10. MISCELLANEOUS......................................................................................... 73
Section 10.01. Trust Indenture Act Controls...................................................................... 73
Section 10.02. Notices........................................................................................... 73
Section 10.03. Communication by Holders of Notes with Other Holders of Notes..................................... 75
Section 10.04. Certificate and Opinion as to Conditions Precedent................................................ 75
Section 10.05. Statements Required in Certificate or Opinion..................................................... 75
Section 10.06. Rules by Trustee and Agents....................................................................... 76
Section 10.07. No Personal Liability of Directors, Officers, Employees and Stockholders.......................... 76
Section 10.08. Governing Law..................................................................................... 76
Section 10.09. No Adverse Interpretation of Other Agreements..................................................... 76
Section 10.10. Successors........................................................................................ 76
Section 10.11. Severability...................................................................................... 76
Section 10.12. Counterpart Originals............................................................................. 76
Section 10.13. Table of Contents, Headings, etc.................................................................. 77
EXHIBITS
Exhibit A-1 FORM OF NOTE
Exhibit A-2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
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Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
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INDENTURE dated as of August 6, 1999 between Stater Bros. Holdings
Inc., a Delaware corporation ("Stater Bros.") and IBJ Whitehall Bank & Trust
Company, as trustee (the "Trustee").
Stater Bros. and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the 10 3/4%
Series A Senior Notes due 2006 (the "Series A Notes") and the 10 3/4% Series B
Senior Notes due 2006 (the "Series B Notes" and, together with the Series A
Notes, the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"144A Global Note" means a global note substantially in the form of
Exhibit A-1 hereto bearing the Global Note Legend and the Private Placement
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Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person: (1)
Indebtedness of any other Person existing at the time such other Person is
merged with or into, became a Subsidiary of, or substantially all of its
business and assets were acquired by, such specified Person, whether or not such
Indebtedness is incurred in connection with, or in contemplation of, such other
Person merging with or into, becoming a Subsidiary of, or substantially all of
its business and assets being acquired by, such specified Person; and (2)
Indebtedness secured by a Lien encumbering any asset acquired by such specified
Person.
"Acquisition" means the acquisition by Stater Bros. of 43 supermarkets
and one future store site pursuant to the Asset Purchase Agreement.
"Additional Notes" means up to $100.0 million in aggregate principal
amount of Notes (other than the Initial Notes) issued under this Indenture in
accordance with Sections 2.02 and 4.09 hereof, as part of the same series as the
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Initial Notes.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided, that beneficial ownership of 5% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" shall have correlative meanings. For purposes of this definition, but
solely with respect to clause (b) of the first paragraph of Section 4.07, Santee
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LLC shall not be deemed to be an Affiliate of Stater Bros.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedel that apply to such transfer or
exchange.
"Asset Purchase Agreement" means the Asset Purchase Agreement dated as
of May 7, 1999, among Stater Bros., Stater Bros. Markets and Xxxxxxxxx'x, Inc.
"Asset Sale" means: (1) the sale, lease, conveyance or other
disposition of any assets or rights (including but not limited to sale and
leaseback transactions), other than any such sale or other disposition in the
ordinary course of business; provided that the sale, conveyance or other
disposition of all or substantially all of the assets of Stater Bros. and its
Subsidiaries taken as a whole shall be governed by the provisions of Section
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4.14 hereof and/or the provisions of Article 5 hereof and not by the provisions
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of Sections 3.09 and 4.10 hereof; and (2) the issuance of Equity Interests by
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any of Stater Bros.' Restricted Subsidiaries or the sale of Equity Interests in
any of its Subsidiaries.
Notwithstanding the foregoing, the following items shall not be deemed
to be Asset Sales: (1) any single transaction or series of related transactions
that involves assets having a fair market value of less than $1.0 million; (2) a
transfer of assets between or among Stater Bros. and its Wholly-Owned
Subsidiaries (other than an Unrestricted Subsidiary); (3) an issuance of Equity
Interests by a Restricted Subsidiary to Stater Bros. or to another Wholly-Owned
Subsidiary (other than an Unrestricted Subsidiary) of Stater Bros.; (4) the sale
or lease of equipment, inventory, accounts receivable or other assets in the
ordinary course of business; (5) any sale by Stater Bros. Markets of its
interest in Santee LLC pursuant to the terms of the limited liability company
agreement governing Santee LLC; (6) the sale or other disposition of cash or
Cash Equivalents; and (7) a Restricted Payment or Permitted Investment that is
permitted by Section 4.07 hereof.
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"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time or upon the occurrence of a
subsequent condition. The terms "Beneficially Owns" and "Beneficially Owned"
shall have a corresponding meaning.
"Board of Directors" means: (1) with respect to a corporation, the
board of directors of the corporation; (2) with respect to a partnership, the
board of directors of the general partner of the partnership; and (3) with
respect to any other Person, the board or committee of such Person serving a
similar function.
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"Business Day" means any day other than a Legal Holiday.
"Calculation Date" has the meaning specified in the definition of
"Fixed Charge Coverage Ratio."
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means: (1) in the case of a corporation, corporate
stock; (2) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock; (3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and (4) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"Cash Equivalents" means: (1) United States dollars; (2) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof (provided, that the full
faith and credit of the United States is pledged in support thereof) having
maturities of not more than one year from the date of acquisition; (3)
certificates of deposit and eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case, with any domestic
commercial bank having capital and surplus in excess of $500.0 million and a
Thomson Bank Watch Rating of "B" or better; (4) repurchase obligations for
underlying securities of the types described in clauses (2) and (3) above
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entered into with any financial institution meeting the qualifications specified
in clause (3) above; (5) commercial paper having the highest rating obtainable
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from Xxxxx'x Investors Service, Inc. or Standard & Poor's Rating Services and in
each case maturing within six months after the date of acquisition; and (6)
money market funds at least 95% of the assets of which constitute Cash
Equivalents of the kinds described in clauses (1) through (5) of this
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definition.
"Cedel" means Cedel Bank, SA.
"Change of Control" means the occurrence of any of the following: (1)
the direct or indirect sale, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of Stater
Bros. and its Restricted Subsidiaries taken as a whole to any "person" or
"group" of persons (as such terms are used in Section 13(d)(3) of the Exchange
Act) other than either Xx Xxxxxx Investments or any Xx Xxxxxx Successor; (2) the
adoption of a plan relating to the liquidation or dissolution of Stater Bros.;
(3) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any "person" or "group" (as
defined above), other than Xx Xxxxxx Investments or any Xx Xxxxxx Successor,
becomes the Beneficial Owner, directly or indirectly, of more than 50% of the
Voting Stock of Stater Bros., measured by voting power rather than number of
shares; (4) the first day on which a majority of the members of the Board of
Directors of Stater Bros. are not Continuing Directors; (5) Stater Bros.
consolidates with, or merges with or into, any Person, or any Person
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consolidates with, or merges with or into, Stater Bros., in any such event
pursuant to a transaction in which any of the outstanding Voting Stock of Stater
Bros. or such other Person is converted into or exchanged for cash, securities
or other property, other than any such transaction where all or a portion of the
Voting Stock of Stater Bros. outstanding immediately prior to such transaction
is converted into or exchanged for Voting Stock (other than Disqualified Stock)
of the surviving or transferee Person constituting a majority of the outstanding
shares of such Voting Stock of such surviving or transferee Person (immediately
after giving effect to such issuance); or (6) at any time prior to the date that
a Xx Xxxxxx Successor is the Beneficial Owner of more than 50% of the Voting
Stock of Stater Bros., Xxxx X. Xxxxx shall cease to (A) be a general partner or
managing member of Xx Xxxxxx Investments, (B) have the power to vote the
majority of the Capital Stock of Xx Xxxxxx Investments, (C) be the Beneficial
Owner of at least 35% of the Equity Interests in Xx Xxxxxx Investments, or (D)
be the Beneficial Owner of a higher percentage of the Equity Interests in Xx
Xxxxxx Investments than any other "person" or "group" of persons (as such terms
are used in Section 13(d)(3) of the Exchange Act).
"Commission" means the Securities and Exchange Commission.
"Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period plus:
(1) an amount equal to any extraordinary loss plus the amount of any net loss
realized by such Person or any of its Consolidated Subsidiaries in connection
with (A) an Asset Sale, or (B) the disposition of any securities by such Person
or any of its Subsidiaries or the extinguishment of any Indebtedness of such
Person or any of its Subsidiaries, in each case to the extent such losses were
deducted in computing such Consolidated Net Income; plus (2) provision for taxes
based on income or profits of such Person and its Consolidated Subsidiaries for
such period, to the extent that such provision for taxes was deducted in
computing such Consolidated Net Income; plus (3) consolidated interest expense
of such Person and its Consolidated Subsidiaries for such period, whether paid
or accrued and whether or not capitalized (including, without limitation,
amortization of debt issuance costs and original issue discount, non-cash
interest payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, commissions, discounts and other fees and charges incurred in
respect of letter of credit or bankers' acceptance financings, and net of the
effect of all payments made or received pursuant to Hedging Obligations), to the
extent that any such expense was deducted in computing such Consolidated Net
Income; plus (4) depreciation, amortization (including amortization of goodwill
and other intangibles but excluding amortization of prepaid cash expenses that
were paid in a prior period) and other non-cash expenses (excluding any such
non-cash expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period or amortization of a prepaid cash expense
that was paid in a prior period) of such Person and its Consolidated
Subsidiaries for such period to the extent that such depreciation, amortization
and other non-cash expenses were deducted in computing such Consolidated Net
Income; minus (5) non-cash items increasing such Consolidated Net Income for
such period, other than the accrual of revenue in the ordinary course of
business, in each case, on a consolidated basis and determined in accordance
with GAAP.
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Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization and other non-cash
expenses of, a Consolidated Subsidiary of Stater Bros. shall be added to
Consolidated Net Income to compute Consolidated Cash Flow of Stater Bros. only
to the extent that a corresponding amount would be permitted at the date of
determination to be dividended to Stater Bros. by such Consolidated Subsidiary
without prior governmental approval (that has not been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Consolidated Subsidiary or its
stockholders.
"Consolidated Net Income" means, with respect to any specified Person
for any period, the aggregate of the Net Income of such Person and its
Consolidated Subsidiaries for such period, on a consolidated basis, determined
in accordance with GAAP; provided that: (1) the Net Income (but not loss) of
Santee LLC and any Person that is not a Consolidated Subsidiary or that is
accounted for by the equity method of accounting shall be included only to the
extent of the amount of dividends or distributions paid in cash to the specified
Person or a Restricted Subsidiary thereof; (2) the Net Income of any
Consolidated Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by such Consolidated Subsidiary of
that Net Income is not at the date of determination permitted without any prior
governmental approval (that has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to such
Consolidated Subsidiary or its stockholders; (3) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded; and (4) the cumulative effect of a change
in accounting principles shall be excluded.
"Consolidated Net Worth" means, with respect to any specified Person
as of any date, the sum of: (1) the consolidated equity of the common
stockholders of such Person and its Consolidated Subsidiaries as of such date;
plus (2) (a) the respective amounts reported on such Person's balance sheet as
of such date with respect to any series of preferred stock (other than
Disqualified Stock) that by its terms is not entitled to the payment of
dividends unless such dividends may be declared and paid only out of net
earnings in respect of the year of such declaration and payment, but only to the
extent of any cash received by such Person upon issuance of such preferred
stock, less (b) the sum of (i) all write-ups (other than write-ups resulting
from foreign currency translations and write-ups of tangible assets of a going
concern business made within 12 months after the acquisition of such business)
subsequent to the date of this Indenture in the book value of any asset owned by
such Person or a Consolidated Subsidiary of such Person; (ii) the book value of
all intangible assets (as determined in accordance with GAAP) of such Person and
its Consolidated Subsidiaries; (iii) any amounts attributable to the cost of
treasury stock and the principal amount of any promissory notes receivable from
the sale of Capital Stock of such Person or any of its Subsidiaries; (iv) all
investments in Persons that are not Consolidated Subsidiaries; and (v) all
unamortized debt discount and expense and unamortized deferred charges, all of
the foregoing determined in accordance with GAAP.
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"Consolidated Subsidiary" of any Person means a subsidiary which for
financial reporting purposes is or, in accordance with GAAP, should be,
accounted for by such Person as a consolidated subsidiary; provided, however,
that the Unrestricted Subsidiaries of Stater Bros. shall not be included as
Consolidated Subsidiaries of Stater Bros. for purposes of this Indenture,
regardless of whether such Unrestricted Subsidiaries are or, in accordance with
GAAP, should be accounted for as consolidated subsidiaries; provided, further,
that any Person that is not a Subsidiary (as such term is defined herein) of a
Person shall not be included as a Consolidated Subsidiary of such Person,
regardless of whether such Person is, or in accordance with GAAP, should be
accounted for as a consolidated subsidiary.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of Stater Bros. who: (1) was a member of such
Board of Directors on the date of this Indenture; or (2) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 10.02 hereof or such other address as to which the
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Trustee may give notice to Stater Bros.
"Credit Facilities" means one or more debt facilities (including,
without limitation, the Revolving Credit Facility) or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special-purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
in whole or in part (whether by revolving or other long-term Indebtedness) from
time to time.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof, in the
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form of Exhibit A-1 hereto except that such Note shall not bear the Global Note
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Legend and shall not have the "Schedule of Exchanges of Interests in the Global
Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
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the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the
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option of the holder thereof), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder thereof, in whole or in part, on or prior
to the date that is 91 days after the date on which the Notes mature.
Notwithstanding the preceding sentence, any Capital Stock that would constitute
Disqualified Stock solely because the holders thereof have the right to require
Stater Bros. to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale shall not constitute Disqualified Stock if the terms of
such Capital Stock provide that Stater Bros. may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.07 hereof.
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"DTC" means The Depository Trust Company, a New York corporation.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
---------------
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means up to $6.0 million in aggregate
principal amount of Indebtedness of Stater Bros. and its Restricted Subsidiaries
(other than Indebtedness under the Revolving Credit Facility) in existence on
the date of this Indenture, until such amounts are repaid.
"Fixed Charge Coverage Ratio" means, with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person for such period. In the
event that the specified Person or any of its Restricted Subsidiaries incurs,
assumes, Guarantees, repays, repurchases or redeems any Indebtedness (other than
ordinary working capital borrowings) or issues, repurchases or redeems preferred
stock subsequent to the commencement of the period for which the Fixed Charge
Coverage Ratio is being calculated and on or prior to the date on which the
event for which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated
giving pro forma effect to such incurrence, assumption, Guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the
same had occurred at the beginning of the applicable four-quarter reference
period.
7
In addition, for purposes of calculating the Fixed Charge Coverage
Ratio: (1) acquisitions that have been made by the specified Person or any of
its Subsidiaries, including through mergers or consolidations and including any
related financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation Date
shall be given pro forma effect as if they had occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such reference
period shall be calculated on a pro forma basis in accordance with Regulation S-
X under the Securities Act, but without giving effect to clause (3) of the
proviso set forth in the definition of Consolidated Net Income; (2) the
Consolidated Cash Flow attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded; and (3) the Fixed Charges attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, shall be excluded, but
only to the extent that the obligations giving rise to such Fixed Charges will
not be obligations of the specified Person or any of its Subsidiaries following
the Calculation Date.
"Fixed Charges" means, with respect to any specified Person for any
period, the sum, without duplication, of: (1) the consolidated interest expense
of such Person and its Consolidated Subsidiaries for such period, whether paid
or accrued, including, without limitation, amortization of original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings, and
excluding (A) the amortization of any debt issuance costs and (B) the effect of
all payments made or received pursuant to Hedging Obligations; plus (2) the
consolidated interest of such Person and its Consolidated Subsidiaries that was
capitalized during such period; plus (3) any interest expense on Indebtedness of
another Person that is Guaranteed by such Person or one of its Consolidated
Subsidiaries or secured by a Lien on assets of such Person or one of its
Consolidated Subsidiaries, whether or not such Guarantee or Lien is called upon;
plus (4) all dividends, whether paid or accrued and whether or not in cash, on
any series of preferred stock of such Person or any of its Consolidated
Subsidiaries, other than dividends on Equity Interests payable solely in Equity
Interests of Stater Bros. (other than Disqualified Stock) or to Stater Bros. or
a Consolidated Subsidiary of Stater Bros.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, substantially in the
form of Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(iv),
--------- ------------ -----------
2.06(d)(ii) or 2.06(f) hereof.
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8
"Global Note Legend" means the legend set forth in Section
-------
2.06(g)(ii), which is required to be placed on all Global Notes issued under
-----------
this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under: (1) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements; and (2) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Holder" means each holder of the Notes.
"IAI Global Note" means the global Note substantially in the form of
Exhibit A-1 hereto bearing the Global Note Legend and the Private Placement
-----------
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold to Institutional Accredited
Investors.
"Indebtedness" means, with respect to any specified Person and without
duplication, any liability of such Person, whether or not contingent: (1) for
borrowed money; (2) evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof); (3) in
respect of banker's acceptances; (4) representing Capital Lease Obligations; (5)
representing the balance deferred and unpaid of the purchase price of any
property, except any such balance that constitutes an accrued expense or trade
payable; or (6) representing any Hedging Obligations; if and to the extent any
of the preceding items (other than letters of credit and Hedging Obligations)
would appear as a liability upon a balance sheet of the specified Person
prepared in accordance with GAAP. In addition, the term "Indebtedness" includes
all Indebtedness of others secured by a Lien on any asset of the specified
Person (whether or not such Indebtedness is assumed by the specified Person)
and, to the extent not otherwise included, the Guarantee by the specified Person
of any indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value thereof, in the case of any Indebtedness issued with
original issue discount; and (2) the principal amount thereof, together with any
interest thereon that is more than 30 days past due, in the case of any other
Indebtedness.
For the avoidance of doubt, the Santee Financing and the Santee
Documents, as amended, modified, renewed, refunded or replaced from time to time
(provided, that the terms of
9
such documents as so amended, modified, renewed, refunded or replaced are at
least as favorable to the Holders of Notes as those contained in the Santee
Documents as in effect on the date of this Indenture) will be deemed not to
constitute, nor to have given rise to, the incurrence of any Indebtedness of
Stater Bros. or any of its Subsidiaries; provided, however, that if Santee LLC
or Santee becomes a Restricted Subsidiary, and at such time, the Santee
Financing would otherwise qualify as "Indebtedness" of Santee under this
definition, the Santee Financing shall not fail to so qualify solely because of
the provisions of this sentence.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means the first $450 million in aggregate principal
amount of Notes issued under this Indenture on the date hereof.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If Stater
Bros. or any Restricted Subsidiary of Stater Bros. sells or otherwise disposes
of any Equity Interests of any direct or indirect Restricted Subsidiary of
Stater Bros. such that, after giving effect to any such sale or disposition,
such Person is no longer a Subsidiary of Stater Bros., then Stater Bros. shall
be deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Equity Interests of such Subsidiary not
sold or disposed of pursuant to such sale or disposition in an amount determined
as provided in the final paragraph of Section 4.07 hereof. If Stater Bros. or
------------
any Restricted Subsidiary of Stater Bros. designates a Restricted Subsidiary to
be an Unrestricted Subsidiary pursuant to the provisions of this Indenture, then
Stater Bros. shall be deemed to have made an Investment on the date of such
designation equal to the fair market value of the Equity Interests of such
Subsidiary in an amount determined as provided in the final paragraph of
Section 4.07 hereof. The acquisition by Stater Bros. or any Restricted
------------
Subsidiary of Stater Bros. of a Person that holds an Investment in any third
Person shall be deemed to be an Investment by Stater Bros. or such Subsidiary in
such third Person in an amount equal to the fair market value of the Investment
held by the acquired Person in such third Person in an amount determined as
provided in the final paragraph of Section 4.07.
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"Xx Xxxxxx Investments" means Xx Xxxxxx Investments, a California
general partnership.
10
"Xx Xxxxxx Successor" means a partnership or limited liability company
(other than Xx Xxxxxx Investments) with respect to which (1) Xxxx X. Xxxxx is a
general partner or managing member, (2) Xxxx X. Xxxxx has the power to vote the
majority of the Capital Stock, (3) Xxxx X. Xxxxx is the Beneficial Owner of at
least 35% of the Equity Interests therein and (4) Xxxx X. Xxxxx is the
Beneficial Owner of a higher percentage of the Equity Interests therein than any
other "person" or "group" of persons (as such terms are used in Section 13(d)(3)
of the Exchange Act).
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by Stater Bros. and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Liquidated Damages" means all liquidated damages then owing pursuant
to Section 4 of the Registration Rights Agreement.
"Markets Preferred Stock" means the $11.00 Cumulative Preferred Stock
issued by Stater Bros. Markets.
"Net Income" means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however: (1) any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with: (A) any Asset Sale; or (B) the
disposition of any securities by such Person or any of its Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Subsidiaries;
and (2) any extraordinary gain (but not loss), together with any related
provision for taxes on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by Stater
Bros. or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale, including, without limitation, legal, accounting
and investment banking fees, and sales commissions, and any relocation expenses
incurred as a result thereof, taxes paid or payable as a result thereof, in each
case after taking into
11
account any available tax credits or deductions and any tax sharing arrangements
and amounts required to be applied to the repayment of Indebtedness, other than
Indebtedness under the Revolving Credit Facility, secured by a Lien on the asset
or assets that were the subject of such Asset Sale and any reserve for
adjustment in respect of the sale price of such asset or assets established in
accordance with GAAP.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Notes" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes shall be treated as a
single class for all purposes under this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of Stater
Bros. by two Officers of Stater Bros., one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of Stater Bros., that meets the requirements of
Section 10.05 hereof.
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"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of
Section 10.05 hereof. The counsel may be an employee of or counsel to Stater
-------------
Bros., any Subsidiary of Stater Bros. or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively (and, with respect to The Depository Trust Company, shall include
Euroclear and Cedel).
"Participating Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Permitted Construction Indebtedness" means Indebtedness of Stater
Bros. or any Restricted Subsidiary representing the deferred purchase price, or
the net proceeds of which are used solely to finance the purchase price, cost of
construction, lease, or major remodeling or major refurbishment of any new or
existing supermarket (including any fixtures therein) operated or to be operated
by Stater Bros. or Stater Bros. Markets. For purposes hereof, "major
remodeling" or "major refurbishment" of a supermarket shall mean a remodeling or
refurbishment of a supermarket in a single transaction or a series of related
transactions involving aggregate expenditures equal to or greater than $250,000
per project site.
12
"Permitted Investments" means: (1) any Investment in Stater Bros. or
in a Restricted Subsidiary (including any Person who becomes a Subsidiary as a
result of any Investment, other than an Unrestricted Subsidiary), provided that
any Indebtedness evidencing such Investment in a Restricted Subsidiary is not
subordinated to any Indebtedness or other obligation of such Restricted
Subsidiary; (2) the making of Investments in Stater Bros. by any Subsidiary
(provided that any Indebtedness evidencing such Investment is subordinated and
junior to the Notes); (3) any Investment in Cash Equivalents; (4) any Investment
by Stater Bros. or any Restricted Subsidiary in a Person, if as a result of such
Investment: (A) such Person becomes a Wholly-Owned Subsidiary (other than an
Unrestricted Subsidiary) of Stater Bros.; or (B) such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, Stater Bros. or a Restricted
Subsidiary of Stater Bros.; (5) any Investment made as a result of the receipt
of non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Sections 3.09 and 4.10; (6) any acquisition of assets or any
------------- ----
Investment in any Person solely in exchange for the issuance of Equity Interests
(other than Disqualified Stock) of Stater Bros.; (7) the making of Investments
in Santee LLC of up to $25.0 million; (8) the making of Investments in Santee
LLC for the purpose of purchasing additional limited liability company interests
in Santee LLC with the proceeds of a Qualified Xx Xxxxxx Investment; (9) the
extensions of trade credit and advances to customers and suppliers to the extent
in the ordinary course of business and made in accordance with customary
industry practice; and (10) Hedging Obligations.
"Permitted Liens" means: (1) Liens of Stater Bros. and any Restricted
Subsidiary securing Indebtedness and other Obligations (A) under the Revolving
Credit Facility and (B) under other Credit Facilities that, in each case, were
permitted by the terms of this Indenture to be incurred; (2) Liens in favor of
Stater Bros. or any Restricted Subsidiary; (3) Liens on property of a Person
existing at the time such Person is merged with or into or consolidated with
Stater Bros. or any Restricted Subsidiary of Stater Bros.; provided, that such
Liens were in existence prior to the contemplation of such merger or
consolidation and do not extend to any assets other than those of the Person
merged into or consolidated with Stater Bros. or the Restricted Subsidiary; (4)
Liens on property existing at the time of acquisition thereof by Stater Bros. or
any Restricted Subsidiary of Stater Bros., provided, that such Liens were in
existence prior to the contemplation of such acquisition and do not extend to
any assets other than such acquired property; (5) Liens or deposits to secure
the performance of bids, trade contracts (other than for borrowed money),
leases, statutory obligations, surety or appeal bonds, performance bonds or
other obligations of a like nature incurred in the ordinary course of business;
(6) Liens to secure Indebtedness (including Capital Lease Obligations and
Permitted Construction Indebtedness) permitted by clauses (b), (d), (e), (h),
----------- --- --- ---
(k), (m), (n) and (o) of the second paragraph of Section 4.09 covering only the
--- --- --- --- ------------
assets acquired with or improved with the proceeds of such Indebtedness; (7)
Liens securing the Notes; (8) Liens for taxes, assessments or governmental
charges or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and diligently
concluded, provided, that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor; (9) Liens
incurred in the ordinary course of business of Stater Bros. or any Restricted
Subsidiary with respect to obligations that do not exceed $5.0 million at any
one time outstanding; (10) Liens existing on the date of this Indenture and
renewals, extensions and replacements thereof,
13
provided, that such renewals, extensions or replacements will not apply to any
property or assets not previously subject to such Liens or increase the
principal amount of obligations secured thereby; (11) Liens on deposits made in
the ordinary course of business; (12) Liens in favor of collecting banks having
a right of setoff, revocation, refund or chargeback with respect to money or
instruments of Stater Bros. or any Restricted Subsidiary on deposit with or in
possession of such banks; (13) Liens in respect of Permitted Refinancing
Indebtedness; provided, that the terms of such liens in respect of such
Permitted Refinancing Indebtedness are not less favorable to the Holders of the
Notes than the terms of the Liens securing the indebtedness being refinanced and
do not extend to any assets not securing such indebtedness; (14) carriers',
warehousemen's, mechanics' materialmen's, repairmen's or other like Liens
arising in the ordinary course of business and not overdue for a period of more
than 90 days or which are being contested in good faith by appropriate
proceedings; (15) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation; (16) easements,
rights-of-way, restrictions and other similar encumbrances incurred in the
ordinary course of business which, in the aggregate, are not substantial in
amount and which do not in any case materially detract from the value of the
property subject thereto or materially interfere with the ordinary course of
business of Stater Bros. or its Subsidiaries, as the case may be, and any
exceptions to title set forth in any title policies; (17) any attachment or
judgment Lien so long as the execution or other enforcement thereof is
effectively stayed, the claims secured thereby are being contested in good faith
by appropriate proceedings, adequate reserves have been established with respect
to such claims in accordance with GAAP and no Default or Event of Default would
result thereby; and (18) any Liens relating solely to property leased by Stater
Bros. or any Subsidiary and arising solely out of the lease for such property.
"Permitted Refinancing Indebtedness" means any Indebtedness of Stater
Bros. or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of Stater Bros. or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided, that: (1) the principal
amount (or accreted value, if applicable) of such Permitted Refinancing
Indebtedness does not exceed the principal amount (or accreted value, if
applicable) of the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus all accrued interest thereon and the amount of all
expenses and premiums incurred in connection therewith); (2) such Permitted
Refinancing Indebtedness has a final maturity date later than the final maturity
date of, and has a Weighted Average Life to Maturity equal to or greater than
the Weighted Average Life to Maturity of, the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; (3) if the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded is
subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and is subordinated in right of payment to, the Notes on terms at least as
favorable to the holders of the Notes as those contained in the documentation
governing the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; and (4) such Indebtedness is incurred either by Stater
Bros. or by the Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
14
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"Petrolane Leases" means that certain Amended and Restated Sublease
Agreement between ARM Leasing Corp., as Lessor and Stater Bros. Markets, as
Lessee dated as of June 1, 1963, that certain Amended and Restated Sublease
Agreement between Clipse Leasing Corp., as Lessor and Stater Bros. Markets, as
Lessee dated as of May 2, 1983, that certain Sublease Agreement between ARM
Leasing Corp., as Lessor and Stater Bros. Markets, as Lessee dated as of
December 1, 1983, and that certain Amended and Restated Sublease Agreement
between Xxxx Leasing Corp., as Lessor and Stater Bros. Markets, as Lessee dated
as of June 1, 1983, in each case as amended, modified, renewed, refunded or
replaced from time to time; provided, that the terms of such documents as so
amended, modified, renewed, refunded or replaced are at least as favorable to
the Holders of Notes as those contained in the Petrolane Leases as in effect on
the date of this Indenture.
"Private Placement Legend" means the legend set forth in Section
-------
2.06(g)(i) to be placed on all Notes issued under this Indenture except where
----------
otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Qualified Xx Xxxxxx Investment" means an Investment made in Stater
Bros. by Xx Xxxxxx Investments or any Xx Xxxxxx Successor for the purpose of
providing funds to either Stater Bros. or Stater Bros. Markets, as the case may
be, to purchase additional limited liability company interests in Santee LLC;
provided, however, that if such an Investment is made in the form of
Indebtedness, then such Indebtedness will be (a) unsecured Indebtedness, and (b)
subordinated Indebtedness.
"Qualified Santee LLC Interest Sale" means a sale by Stater Bros.
Markets of all or any portion of its interest in Santee LLC.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of August 6, 1999, by and among Stater Bros. and the other
parties named on the signature pages thereof, as such agreement may be amended,
modified or supplemented from time to time and, with respect to any Additional
Notes, one or more registration rights agreements between Stater Bros. and the
other parties thereto, as such agreement(s) may be amended, modified or
supplemented from time to time, relating to rights given by Stater Bros. to the
purchasers of Additional Notes to register such Additional Notes under the
Securities Act.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
15
"Regulation S Permanent Global Note" means a permanent global Note in
the form of Exhibit A-1 hereto bearing the Global Note Legend and the Private
-----------
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note in
the form of Exhibit A-2 hereto bearing the Private Placement Legend and
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deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in a denomination equal to the outstanding principal amount
of the Notes initially sold in reliance on Rule 903 of Regulation S.
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S.
"Restricted Subsidiary" means any Subsidiary of Stater Bros. that is
not an Unrestricted Subsidiary.
"Revolving Credit Facility" means the credit facility governed by that
certain Credit Agreement, dated as of August 6, 1999, by and among Stater Bros.
Markets, Stater Bros., the lenders from time to time party thereto, and Bank of
America, N.A., as agent, including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, and in
each case as amended, modified, renewed, refunded, replaced or refinanced from
time to time, including any such amendment, restatement, modification, renewal,
refunding, replacement, or refinancing facility that alters the maturity
thereof.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
16
"Rule 904" means Rule 904 promulgated the Securities Act.
"Santee" means Santee Dairies, Inc., a California corporation, a
wholly-owned Subsidiary of Santee LLC.
"Santee Documents" means that certain Product Purchase Agreement
between Stater Bros. Markets and Santee , that certain Owner Consent between
Stater Bros. Markets and the trustee pursuant to the trust agreement executed as
part of the Santee Financing, that certain Limited Liability Company Agreement
between Stater Bros. Markets, Xxxxxx Markets, Inc., and Santee LLC, that certain
Letter Agreement between Stater Bros. and each of the Santee Noteholders and all
documents effecting and ancillary to the Santee Financing.
"Santee Financing" means the issuance by Santee of up to $80,000,000
in principal amount of notes pursuant to that certain Note Purchase Agreement
dated as of July 30, 1997, as amended through and including the date of this
Indenture, and all transactions incident and ancillary thereto.
"Santee LLC" means Santee Dairies, LLC, a Delaware limited liability
company.
"Santee Noteholders" means the holders of notes with respect to the
Santee Financing.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Series A Notes" has the meaning assigned to it in the preamble to
this Indenture.
"Series B Notes" has the meaning assigned to it in the preamble to
this Indenture.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Stater Bros. Markets" means Stater Bros. Markets, a California
corporation.
"Subsidiary" means, with respect to any specified Person: (1) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and (2) any partnership (a) the sole general partner or
the managing
17
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or of one or more
Subsidiaries of such Person (or any combination thereof).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
77bbbb) as in effect on the date on which this Indenture is qualified under the
TIA.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global Note in the form
of Exhibit A-1 attached hereto that bears the Global Note Legend and that has
-----------
the "Schedule of Exchanges of Interests in the Global Note" attached thereto,
and that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means (1) if and at such time as such
Persons become Subsidiaries of Stater Bros., Santee LLC and Santee (provided,
however, that the board of directors of Stater Bros. may at such time, if any,
as such Persons become such Subsidiaries designate either or both of them as
Restricted Subsidiaries by board resolution in accordance with the terms of this
Indenture), (2) any Subsidiary of Stater Bros. that is designated by the board
of directors of Stater Bros. as an Unrestricted Subsidiary pursuant to a board
resolution in accordance with the terms of this Indenture, and (3) any
Subsidiary of an Unrestricted Subsidiary.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (1) the sum
of the products obtained by multiplying (A) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (B) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by (2) the then outstanding principal
amount of such Indebtedness.
"Wholly-Owned Subsidiary" of any specified Person means any Subsidiary
of such Person all the outstanding shares of Capital Stock (other than
directors' qualifying shares, if applicable) of which are owned directly by such
Person or another Wholly-Owned Subsidiary of
18
such Person, and with respect to Stater Bros., shall include Stater Bros.
Markets so long as Stater Bros. or any Wholly-Owned Subsidiary of Stater Bros.
owns all of the outstanding shares of Capital Stock of Stater Bros. Markets
other than the Markets Preferred Stock.
Section 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Acceleration Notice".............. 6.02
"Affiliate Transaction"............ 4.11
"Asset Sale Offer"................. 3.09
"Authentication Order"............. 2.02
"Change of Control Offer".......... 4.14
"Change of Control Payment"........ 4.14
"Change of Control Payment Date"... 4.14
"Consummation Date"................ 4.10
"Covenant Defeasance".............. 8.03
"Event of Default"................. 6.01
"Excess Proceeds".................. 4.10
"incur"............................ 4.09
"Legal Defeasance"................. 8.02
"Offer Amount"..................... 3.09
"Offer Period"..................... 3.09
"Paying Agent"..................... 2.03
"Payment Default".................. 6.01
"Permitted Debt"................... 4.09
"Purchase Date".................... 3.09
"Redemption Date".................. 3.07
"Registrar"........................ 2.03
"Restricted Payments".............. 4.07
Section 1.03. Trust Indenture Act Definitions
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
19
"obligor" on the Notes means Stater Bros. and any successor.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires: (1) a term has the meaning
assigned to it; (2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP; (3) "or" is not exclusive; (4) words in
the singular include the plural, and in the plural include the singular; (5)
provisions apply to successive events and transactions; and (6) references to
sections of or rules under the Securities Act shall be deemed to include
substitute, replacement of successor sections or rules adopted by the SEC from
time to time.
ARTICLE 2.
THE NOTES
Section 2.01. Form and Dating.
(a) General.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Notes may have notations,
---------
legends or endorsements required by law, stock exchange rule or usage. Each
Note shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and Stater Bros. and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby. However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.
(b) Global Notes.
Notes issued in global form shall be substantially in the form of
Exhibits A-1 or A-2 attached hereto (including the Global Note Legend thereon
------------ ---
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A-1 attached hereto (but without the Global Note Legend thereon and
-----------
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes
20
represented thereby shall be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
------------
(c) Temporary Global Notes.
Notes offered and sold in reliance on Regulation S shall be issued
initially in the form of the Regulation S Temporary Global Note, which shall be
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, at its New York office, as custodian for the Depositary, and registered
in the name of the Depositary or the nominee of the Depositary for the accounts
of designated agents holding on behalf of Euroclear or Cedel Bank, duly executed
by Stater Bros. and authenticated by the Trustee as hereinafter provided. The
Restricted Period shall be terminated upon the receipt by the Trustee of (i) a
written certificate from the Depositary, together with copies of certificates
from Euroclear and Cedel Bank certifying that they have received certification
of non-United States beneficial ownership of 100% of the aggregate principal
amount of the Regulation S Temporary Global Note (except to the extent of any
beneficial owners thereof who acquired an interest therein during the Restricted
Period pursuant to another exemption from registration under the Securities Act
and who will take delivery of a beneficial ownership interest in a 144A Global
Note or an IAI Global Note bearing a Private Placement Legend, all as
contemplated by Section 2.06(a)(ii) hereof), and (ii) an Officers' Certificate
-------------------
from Stater Bros. Following the termination of the Restricted Period,
beneficial interests in the Regulation S Temporary Global Note shall be
exchanged for beneficial interests in Regulation S Permanent Global Notes
pursuant to the Applicable Procedures. Simultaneously with the authentication
of Regulation S Permanent Global Notes, the Trustee shall cancel the Regulation
S Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Notes may from time
to time be increased or decreased by adjustments made on the records of the
Trustee and the Depositary or its nominee, as the case may be, in connection
with transfers of interest as hereinafter provided.
(d) Euroclear and Cedel Procedures Applicable
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel Bank shall be
applicable to transfers of beneficial interests in the Regulation S Temporary
Global Note and the Regulation S Permanent Global Notes that are held by
Participants through Euroclear or Cedel Bank.
Section 2.02. Execution and Authentication.
Two Officers shall sign the Notes for Stater Bros. by manual or
facsimile signature. Stater Bros.' seal shall be reproduced on the Notes and
may be in facsimile form.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
21
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee shall, upon a written order of Stater Bros. signed by two
Officers (an "Authentication Order"), authenticate Notes for original issue up
to the aggregate principal amount stated in paragraph 4 of the Notes. The
aggregate principal amount of Notes outstanding at any time may not exceed such
amount except as provided in Section 2.07 hereof.
------------
The Trustee may appoint an authenticating agent acceptable to Stater
Bros. to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent shall have the same rights as an Agent to deal with Holders
or an Affiliate of Stater Bros.
Section 2.03. Registrar and Paying Agent.
Stater Bros. shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
Stater Bros. may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. Stater Bros. may change
any Paying Agent or Registrar without notice to any Holder. Stater Bros. shall
notify the Trustee in writing of the name and address of any Agent not a party
to this Indenture. If Stater Bros. fails to appoint or maintain another entity
as Registrar or Paying Agent, the Trustee shall act as such. Stater Bros. or
any of its Subsidiaries may act as Paying Agent or Registrar.
Stater Bros. initially appoints DTC to act as Depositary with respect
to the Global Notes.
Stater Bros. initially appoints the Trustee to act as the Registrar
and Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
Stater Bros. shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes, and
will notify the Trustee of any default by Stater Bros. in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. Stater Bros. at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than Stater Bros. or a
Subsidiary) shall have no further liability for the money. If Stater Bros. or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy
22
or reorganization proceedings relating to Stater Bros., the Trustee shall serve
as Paying Agent for the Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA (S) 312(a). If the Trustee is
not the Registrar, Stater Bros. shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and Stater Bros. shall otherwise comply with TIA (S) 312(a).
Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange of Global Notes.
A Global Note may not be transferred as a whole except by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to the
Depositary or to another nominee of the Depositary, or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Notes will be exchanged by Stater Bros. for Definitive
Notes if (i) Stater Bros. delivers to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that it is no
longer a clearing agency registered under the Exchange Act and, in either case,
a successor Depositary is not appointed by Stater Bros. within 120 days after
the date of such notice from the Depositary or (ii) Stater Bros. in its sole
discretion determines that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and delivers a written notice to such effect to
the Trustee; provided, that in no event shall the Regulation S Temporary Global
Note be exchanged by Stater Bros. for Definitive Notes prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of any
certificates required pursuant to Rule 903(c)(3)(ii)(B) under the Securities
Act. Upon the occurrence of either of the preceding events in (i) or (ii)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
------------- ----
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
------------ ------------ ----
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as
provided in this Section 2.06(a), however, beneficial interests in a Global Note
---------------
may be transferred and exchanged as provided in Section 2.06(b), (c) or (f)
--------------- --- ---
hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the
23
Securities Act. Transfers of beneficial interests in the Global Notes also shall
require compliance with either subparagraph (i) or (ii) below, as applicable, as
--------------- ---
well as one or more of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note. Beneficial
interests in any Restricted Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in the same
Restricted Global Note in accordance with the transfer restrictions set forth
in the Private Placement Legend; provided, however, that prior to the
expiration of the Restricted Period, transfers of beneficial interests in the
Temporary Regulation S Global Note may not be made to a U.S. Person or for
the account or benefit of a U.S. Person (other than an Initial Purchaser).
Beneficial interests in any Unrestricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers described
in this Section 2.06(b)(i).
------------------
(ii) All Other Transfers and Exchanges of Beneficial Interests in Global
Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor of
------------------
such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in another
Global Note in an amount equal to the beneficial interest to be transferred
or exchanged and (2) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant account to be
credited with such increase or (B) (1) a written order from a Participant or
an Indirect Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be issued a
Definitive Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given by the Depositary to the
Registrar containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or exchange
referred to in (1) above; provided, that in no event shall Definitive Notes
be issued upon the transfer or exchange of beneficial interests in the
Regulation S Temporary Global Note prior to (x) the expiration of the
Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903 under the Securities Act. Upon consummation of
an Exchange Offer by Stater Bros. in accordance with Section 2.06(f) hereof,
---------------
the requirements of this Section 2.06(b)(ii) shall be deemed to have been
-------------------
satisfied upon receipt by the Registrar of the instructions contained in the
Letter of Transmittal delivered by the Holder of such beneficial interests in
the Restricted Global Notes. Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in Global Notes contained in
this Indenture and the Notes or otherwise applicable under the Securities
Act, the Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.06(h) hereof.
---------------
(iii) Transfer of Beneficial Interests to Another Restricted Global Note.
A beneficial interest in any Restricted Global Note may be transferred to a
Person who takes delivery thereof in the form of a beneficial interest in
another Restricted Global Note if the transfer
24
complies with the requirements of Section 2.06(b)(ii) above and the Registrar
------------------
receives the following: (A) if the transferee will take delivery in the form
of a beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
---------
certifications in item (1) thereof; (B) if the transferee will take delivery
in the form of a beneficial interest in the Regulation S Temporary Global
Note or the Regulation S Permanent Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
---------
certifications in item (2) thereof; and (C) if the transferee will take
delivery in the form of a beneficial interest in the IAI Global Note, then
the transferor must deliver a certificate in the form of Exhibit B hereto,
---------
including the certifications and certificates and Opinion of Counsel required
by item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted Global
Note for Beneficial Interests in the Unrestricted Global Note. A beneficial
interest in any Restricted Global Note may be exchanged by any holder thereof
for a beneficial interest in an Unrestricted Global Note or transferred to a
Person who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note if the exchange or transfer complies with the
requirements of Section 2.06(b)(ii) above and: (A) such exchange or transfer
-------------------
is effected pursuant to the Exchange Offer in accordance with the
Registration Rights Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that it is not
(1) a broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144)
of Stater Bros.; (B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the Exchange
Offer Registration Statement in accordance with the Registration Rights
Agreement; or (D) the Registrar receives the following: (1) if the holder of
such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C hereto,
---------
including the certifications in item (1)(a) thereof; or (2) if the holder of
such beneficial interest in a Restricted Global Note proposes to transfer
such beneficial interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit B hereto, including the
---------
certifications in item (4) thereof, and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the Applicable
Procedures so require, an Opinion of Counsel in form reasonably acceptable to
the Registrar to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
---------------- ---
above at a time when an Unrestricted Global Note has not yet been issued, Stater
Bros. shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
------------
Unrestricted Global Notes in an aggregate principal amount equal to the
25
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Restricted Definitive Note, then, upon
receipt by the Registrar of the following documentation: (A) if the holder
of such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the certifications in
---------
item (2)(a) thereof; (B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications in
---------
item (1) thereof; (C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903 or
Rule 904 under the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (2) thereof; (D) if
---------
such beneficial interest is being transferred pursuant to an exemption from
the registration requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(a) thereof; (E) if
---------
such beneficial interest is being transferred to an Institutional Accredited
Investor in reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs (B) through (D)
above, a certificate to the effect set forth in Exhibit B hereto, including
---------
the certifications, certificates and Opinion of Counsel required by item (3)
thereof, if applicable; (F) if such beneficial interest is being transferred
to Stater Bros. or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
---------
thereof; or (G) if such beneficial interest is being transferred pursuant to
an effective registration statement under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the certifications in
---------
item (3)(c) thereof, the Trustee shall cause the aggregate principal amount
of the applicable Global Note to be reduced accordingly pursuant to Section
-------
2.06(h) hereof, and Stater Bros. shall execute and the Trustee shall
-------
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c) shall be registered in such name or names
---------------
and in such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions from
the Depositary and the Participant or Indirect Participant. The Trustee
shall deliver such Definitive Notes to the Persons in whose names such Notes
are so registered. Any Definitive Note issued in exchange for a beneficial
26
interest in a Restricted Global Note pursuant to this Section 2.06(c)(i)
------------------
shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Regulation S Temporary Global Note to
Definitive Notes. Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof, a
---------------------- ---
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Definitive Note or transferred to a Person who takes delivery
thereof in the form of a Definitive Note prior to (x) the expiration of the
Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act, except
in the case of a transfer pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes delivery
thereof in the form of an Unrestricted Definitive Note only if: (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the holder of such beneficial
interest, in the case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal that it is not
(1) a broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144)
of Stater Bros.; (B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the Exchange
Offer Registration Statement in accordance with the Registration Rights
Agreement; or (D) the Registrar receives the following: (1) if the holder of
such beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of Exhibit C
---------
hereto, including the certifications in item (1)(b) thereof; or (2) if the
holder of such beneficial interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who shall take delivery thereof
in the form of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B hereto,
---------
including the certifications in item (4) thereof; and, in each such case set
forth in this subparagraph (D), if the Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange or transfer is
in compliance with the Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a Definitive
Note or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause
-------------------
the aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and Stater Bros. shall
---------------
execute and the Trustee shall authenticate and
27
deliver to the Person designated in the instructions a Definitive Note in the
appropriate principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iv) shall be registered
-------------------
in such name or names and in such authorized denomination or denominations as
the holder of such beneficial interest shall instruct the Registrar through
instructions from the Depositary and the Participant or Indirect Participant.
The Trustee shall deliver such Definitive Notes to the Persons in whose names
such Notes are so registered. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iv) shall not bear the
-------------------
Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note,
then, upon receipt by the Registrar of the following documentation: (A) if
the Holder of such Restricted Definitive Note proposes to exchange such Note
for a beneficial interest in a Restricted Global Note, a certificate from
such Holder in the form of Exhibit C hereto, including the certifications in
---------
item (2)(b) thereof; (B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
---------
certifications in item (1) thereof; (C) if such Restricted Definitive Note is
being transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a certificate
to the effect set forth in Exhibit B hereto, including the certifications in
---------
item (2) thereof; (D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the Securities
Act in accordance with Rule 144 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the certifications in
---------
item (3)(a) thereof; (E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities Act other than
those listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
---------
certificates and Opinion of Counsel required by item (3) thereof, if
applicable; (F) if such Restricted Definitive Note is being transferred to
Stater Bros. or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
---------
thereof; or (G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
---------
certifications in item (3)(c) thereof, the Trustee shall cancel the
Restricted Definitive Note, increase or cause to be increased the aggregate
principal amount of, in the case of clause (A) above, the appropriate
Restricted Global Note, in the case of clause (B) above, the 144A Global
Note, in the case of clause (c) above, the Regulation S Global Note, and in
all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted
Global Notes. A Holder of a Restricted Definitive Note may exchange such
Note for a beneficial interest in an Unrestricted Global Note or transfer
such Restricted Definitive Note to a Person who
28
takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if: (A) such exchange or transfer is effected
pursuant to the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of Transmittal
that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of Stater Bros.; (B) such transfer is effected pursuant
to the Shelf Registration Statement in accordance with the Registration
Rights Agreement; (C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or (D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to exchange such Notes
for a beneficial interest in the Unrestricted Global Note, a certificate from
such Holder in the form of Exhibit C hereto, including the certifications in
---------
item (1)(c) thereof; or (2) if the Holder of such Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof in the
form of a beneficial interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit B hereto, including the
---------
certifications in item (4) thereof; and, in each such case set forth in this
subparagraph (D), if the Registrar so requests or if the Applicable
Procedures so require, an Opinion of Counsel in form reasonably acceptable to
the Registrar to the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
-------------------
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any time.
Upon receipt of a request for such an exchange or transfer, the Trustee shall
cancel the applicable Unrestricted Definitive Note and increase or cause to
be increased the aggregate principal amount of one of the Unrestricted Global
Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
Stater Bros. shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
------------
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's
compliance with the provisions of this Section 2.06(e), the Registrar shall
---------------
register the transfer or exchange of
29
Definitive Notes. Prior to such registration of transfer or exchange, the
requesting Holder shall present or surrender to the Registrar the Definitive
Notes duly endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Registrar duly executed by such Xxxxxx or by his attorney,
duly authorized in writing. In addition, the requesting Holder shall provide any
additional certifications, documents and information, as applicable, required
pursuant to the following provisions of this Section 2.06(e).
---------------
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name
of Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following: (A) if the transfer will be
made pursuant to Rule 144A under the Securities Act, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
---------
certifications in item (1) thereof; (B) if the transfer will be made pursuant
to Rule 903 or Rule 904, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in item (2)
---------
thereof; and (C) if the transfer will be made pursuant to any other exemption
from the registration requirements of the Securities Act, then the transferor
must deliver a certificate in the form of Exhibit B hereto, including the
---------
certifications, certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if: (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance
with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a broker-dealer, (2) a
Person participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of Stater Bros.; (B) any
such transfer is effected pursuant to the Shelf Registration Statement in
accordance with the Registration Rights Agreement; (C) any such transfer is
effected by a Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement; or (D) the
Registrar receives the following: (1) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for an Unrestricted
Definitive Note, a certificate from such Holder in the form of Exhibit C
---------
hereto, including the certifications in item (1)(d) thereof; or (2) if the
Holder of such Restricted Definitive Notes proposes to transfer such Notes to
a Person who shall take delivery thereof in the form of an Unrestricted
Definitive Note, a certificate from such Holder in the form of Exhibit B
---------
hereto, including the certifications in item (4) thereof; and, in each such
case set forth in this subparagraph (D), if the Registrar so requests, an
Opinion of Counsel in form reasonably acceptable to Stater Bros. to the
effect that such exchange or transfer is in compliance with the Securities
Act and that the restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain compliance with
the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a Person
who takes delivery
30
thereof in the form of an Unrestricted Definitive Note. Upon receipt of a
request to register such a transfer, the Registrar shall register the
Unrestricted Definitive Notes pursuant to the instructions from the Holder
thereof.
(f) Exchange Offer.
Upon the occurrence of the Exchange Offer in accordance with the
Registration Rights Agreement, Stater Bros. shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee shall
------------
authenticate (i) one or more Unrestricted Global Notes in an aggregate principal
amount equal to the principal amount of the beneficial interests in the
Restricted Global Notes tendered for acceptance by Persons that certify in the
applicable Letters of Transmittal that (x) they are not broker-dealers, (y) they
are not participating in a distribution of the Exchange Notes and (z) they are
not affiliates (as defined in Rule 144) of Stater Bros., and accepted for
exchange in the Exchange Offer and (ii) Definitive Notes in an aggregate
principal amount equal to the principal amount of the Restricted Definitive
Notes accepted for exchange in the Exchange Offer. Concurrently with the
issuance of such Notes, the Trustee shall cause the aggregate principal amount
of the applicable Restricted Global Notes to be reduced accordingly, and Stater
Bros. shall execute and the Trustee shall authenticate and deliver to the
Persons designated by the Holders of Definitive Notes so accepted Definitive
Notes in the appropriate principal amount.
(g) Legends.
The following legends shall appear on the face of all Global Notes and
Definitive Notes issued under this Indenture unless specifically stated
otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend. (A) Except as permitted by subparagraph (B)
below, each Global Note and each Definitive Note (and all Notes issued in
exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER
OF THE SECURITY EVIDENCED XXXXXX AGREES FOR THE BENEFIT OF THE ISSUER THAT
(A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY
31
(i) (a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT,
(c) OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (d) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) OF THE SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED
INVESTOR")) THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH
CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $100,000, AN OPINION OF
COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT, OR (e) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL IF THE ISSUER SO REQUESTS),
(ii) TO THE ISSUER, OR
(iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global Note or Definitive Note
issued pursuant to subparagraphs (b)(iv), (c)(iii), (c)(iv), (d)(ii),
(d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and all Notes
------------
issued in exchange therefor or substitution thereof) shall not bear the
Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"This Global Note is held by the Depositary (as defined in the
Indenture governing this Note) or its nominee in custody for the benefit of
the beneficial owners hereof, and is not transferable to any person under any
circumstances except that (i) the Trustee may make such notations hereon as
may be required pursuant to Section 2.07 of the Indenture, (ii) this Global
Note may be exchanged in whole but not in part pursuant to Section 2.06(a) of
the Indenture, (iii) this Global Note may be delivered to the Trustee for
32
cancellation pursuant to Section 2.11 of the Indenture, and (iv) this Global
Note may be transferred to a successor depositary with the prior written
consent of Stater Bros."
(iii) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note shall bear a legend in substantially the following
form:
"The rights attaching to this Regulation S Temporary Global Note,
and the conditions and procedures governing its exchange for Certificated
Notes, are as specified in the Indenture (as defined herein). Neither the
Holder nor the Beneficial Owners of this Regulation S Temporary Global Note
shall be entitled to receive payment of interest hereon."
(h) Cancellation and/or Adjustment of Global Notes.
At such time as all beneficial interests in a particular Global Note
have been exchanged for Definitive Notes or a particular Global Note has been
redeemed, repurchased or canceled in whole and not in part, each such Global
Note shall be returned to or retained and canceled by the Trustee in accordance
with Section 2.11 hereof. At any time prior to such cancellation, if any
------------
beneficial interest in a Global Note is exchanged for or transferred to a Person
who will take delivery thereof in the form of a beneficial interest in another
Global Note or for Definitive Notes, the principal amount of Notes represented
by such Global Note shall be reduced accordingly and an endorsement shall be
made on such Global Note by the Trustee or by the Depositary at the direction of
the Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
shall be increased accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, Stater Bros. shall
execute and the Trustee shall authenticate Global Notes and Definitive Notes
upon Stater Bros.' order or at the Registrar's request. (ii) No service
charge shall be made to a holder of a beneficial interest in a Global Note or
to a Holder of a Definitive Note for any registration of transfer or
exchange, but Stater Bros. may require payment of a sum sufficient to cover
any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09,
------------- ---- ----
4.10, 4.14 and 9.05 hereof). (iii) The Registrar shall not be required to
---- ---- ----
register the transfer of or exchange any Note selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed in
part. (iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of Stater Bros., evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Global Notes or
Definitive Notes surrendered upon such registration of transfer or exchange.
(v) Stater Bros. shall not be required (A) to issue, to register the transfer
of or to exchange any Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for
33
redemption under Section 3.02 hereof and ending at the close of business on
------------
the day of selection, (B) to register the transfer of or to exchange any Note
so selected for redemption in whole or in part, except the unredeemed portion
of any Note being redeemed in part or (C) to register the transfer of or to
exchange a Note between a record date and the next succeeding Interest
Payment Date. (vi) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and Stater Bros. may deem and
treat the Person in whose name any Note is registered as the absolute owner
of such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the Trustee,
any Agent or Stater Bros. shall be affected by notice to the contrary. (vii)
The Trustee shall authenticate Global Notes and Definitive Notes in
accordance with the provisions of Section 2.02 hereof. (viii) All
------------
certifications, certificates and Opinions of Counsel required to be submitted
to the Registrar pursuant to this Section 2.06 to effect a registration of
transfer or exchange may be submitted by facsimile.
SECTION 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or Stater Bros.
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, Stater Bros. shall issue and the Trustee, upon receipt of
an Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or Stater Bros., an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and Stater Bros. to protect Stater Bros., the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. Stater Bros. may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of Stater Bros. and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
SECTION 2.08. OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
------------
does not cease to be outstanding because Stater Bros. or an Affiliate of Stater
Bros. holds the Note; however, Notes held by Stater Bros. or a Subsidiary of
Stater Bros. shall not be deemed to be outstanding for purposes of Section
-------
3.07(b) hereof.
-------
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
------------
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section
-------
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
----
34
If the Paying Agent (other than Stater Bros., a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
SECTION 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by Stater
Bros., or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with Stater Bros., shall be considered
as though not outstanding, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Notes that the Trustee knows are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery, Stater
Bros. may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that Stater Bros.
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, Stater Bros. shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
SECTION 2.11. CANCELLATION.
Stater Bros. at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee and no one else shall cancel all Notes surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes shall be delivered
to Stater Bros. Stater Bros. may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If Stater Bros. defaults in a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. Stater Bros. shall notify the Trustee
------------
in writing of the amount of defaulted interest proposed to be paid on each Note
and the date of the proposed payment. Stater Bros. shall fix or cause to be
fixed each such special record date and payment date; provided, that no such
special record date shall be less than 10 days prior
35
to the related payment date for such defaulted interest. At least 15 days before
the special record date, Stater Bros. (or, upon the written request of Stater
Bros., the Trustee in the name and at the expense of Stater Bros.) shall mail or
cause to be mailed to Holders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.
SECTION 2.13. CUSIP NUMBERS.
Stater Bros. in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use CUSIP numbers in notices of
redemption as a convenience to Holders; provided, that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Notes or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Notes, and any such redemption shall not be affected by any defect in or the
omission of such numbers. Stater Bros. shall promptly notify the Trustee of any
change in the CUSIP numbers.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If Stater Bros. elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
------------
at least 30 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture or the
Notes pursuant to which the redemption shall occur, (ii) the redemption date,
(iii) the principal amount of Notes to be redeemed and (iv) the redemption
price.
SECTION 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select Notes for redemption as follows: (a) if the Notes are
listed, in compliance with the requirements of the principal national securities
exchange on which the Notes are listed; or (b) if the Notes are not so listed,
on a pro rata basis, by lot or by such method as the Trustee shall deem fair and
appropriate.
In the event of partial redemption by lot, the particular Notes to be
redeemed shall be selected, unless otherwise provided herein, not less than 30
nor more than 60 days prior to the redemption date by the Trustee from the
outstanding Notes not previously called for redemption.
The Trustee shall promptly notify Stater Bros. in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
36
SECTION 3.03. NOTICE OF REDEMPTION.
Subject to the provisions of Section 3.09 hereof, at least 30 days but
------------
not more than 60 days before a redemption date, Stater Bros. shall mail or cause
to be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date; (b) the redemption price; (c) if any Note is being
redeemed in part, the portion of the principal amount of such Note to be
redeemed and that, after the redemption date upon surrender of such Note, a new
Note or Notes in principal amount equal to the unredeemed portion shall be
issued upon cancellation of the original Note; (d) the name and address of the
Paying Agent; (e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price; (f) that, unless Stater Bros.
defaults in making such redemption payment, interest on Notes called for
redemption ceases to accrue on and after the redemption date; (g) the paragraph
of the Notes and/or Section of this Indenture pursuant to which the Notes called
for redemption are being redeemed; and (h) that no representation is made as to
the correctness or accuracy of the CUSIP number, if any, listed in such notice
or printed on the Notes.
At Stater Bros.' request, the Trustee shall give the notice of
redemption in Stater Bros.' name and at its expense; provided, however, that
Stater Bros. shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
------------
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
One Business Day prior to the redemption date, Stater Bros. shall
deposit with the Trustee or with the Paying Agent, in immediately available
funds, money sufficient to pay the redemption price of and accrued interest and
Liquidated Damages, if any, on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to Stater Bros. any money
deposited with the Trustee or the Paying Agent by Stater Bros. in excess of the
amounts necessary to pay the redemption price of, and accrued interest and
Liquidated Damages, if any, on, all Notes to be redeemed.
If Stater Bros. complies with the provisions of the preceding
paragraph, on and after the redemption date, interest and Liquidated Damages, if
any, shall cease to accrue on the Notes or the portions of Notes called for
redemption. If a Note is redeemed on or after an interest record date but on or
prior to the related interest payment date, then any accrued and
37
unpaid interest shall be paid to the Person in whose name such Note was
registered at the close of business on such record date. If any Note called for
redemption shall not be so paid upon surrender for redemption because of the
failure of Stater Bros. to comply with the preceding paragraph, interest and
Liquidated Damages, if any, shall be paid on the unpaid principal, from the
redemption date until such principal is paid, and to the extent lawful on any
interest and Liquidated Damages, if any, not paid on such unpaid principal, in
each case at the rate provided in the Notes and in Section 4.01 hereof.
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SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, Stater Bros. shall
issue and, upon Stater Bros.' written request, the Trustee shall authenticate
for the Holder at the expense of Stater Bros., a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Prior to August 15, 2002, Stater Bros. may on any one or more occasions
redeem up to 35% of the aggregate principal amount of Notes issued under this
Indenture at a redemption price of 110.750% of the principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the
redemption date, with the net cash proceeds of one or more sales of Capital
Stock of Stater Bros. resulting, for each such sale, in net cash proceeds to
Stater Bros. in excess of $25.0 million; provided, that: (i) at least 65% of
the aggregate principal amount of Notes issued under this Indenture remains
outstanding immediately after the occurrence of such redemption (excluding Notes
held by Stater Bros. and its Subsidiaries); and (ii) the redemption must occur
within 45 days of the date of the closing of such sale.
(b) Except pursuant to the preceding paragraph, the Notes will not be
redeemable at Stater Bros.' option prior to August 15, 2003.
After August 15, 2003, Stater Bros. may redeem all or a part of the Notes
upon not less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the applicable
redemption date, if redeemed during the twelve-month period beginning on August
15 of the years indicated below:
Year Percentage
---- ----------
2003......................................105.3750%
2004......................................102.6875%
2005 and thereafter.......................100.0000%
(c) Any redemption pursuant to this Section 3.07 shall be made
------------
pursuant to the provisions of Section 3.01 through 3.06 hereof.
------------ ----
38
SECTION 3.08. MANDATORY REDEMPTION.
Stater Bros. shall not be required to make mandatory redemption or sinking
fund payments with respect to the Notes.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, Stater Bros. shall
------------
be required to commence an offer to all Holders to purchase Notes (an "Asset
Sale Offer"), it shall follow the procedures specified below.
The Asset Sale Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later than
five Business Days after the termination of the Offer Period (the "Purchase
Date"), Stater Bros. shall purchase the principal amount of Notes required to be
purchased pursuant to Section 4.10 hereof (the "Offer Amount") or, if less than
------------
the Offer Amount has been tendered, all Notes tendered in response to the Asset
Sale Offer. Payment for any Notes so purchased shall be made in the same manner
as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, Stater Bros. shall send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Sale Offer shall be made to all Holders. The notice, which
shall govern the terms of the Asset Sale Offer, shall state:
(a) that the Asset Sale Offer is being made pursuant to this Section 3.09
------------
and Section 4.10 hereof and the length of time the Asset Sale Offer shall remain
------------
open; (b) the Offer Amount, the purchase price and the Purchase Date; (c) that
any Note not tendered or accepted for payment shall continue to accrue interest
and Liquidated Damages, if any; (d) that, unless Stater Bros. defaults in making
such payment, any Note accepted for payment pursuant to the Asset Sale Offer
shall cease to accrue interest and Liquidated Damages, if any, after the
Purchase Date; (e) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may only elect to have all of such Note purchased and may not
elect to have only a portion of such Note purchased; (f) that Holders electing
to have a Note purchased pursuant to any Asset Sale Offer shall be required to
surrender the Note, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Note completed, or transfer by book-entry transfer, to
Stater Bros., a depositary, if appointed by Stater Bros., or a Paying Agent at
the address specified in the notice at least three days before the Purchase
Date; (g) that Holders shall be entitled to withdraw their election if Stater
Bros., the Depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a telegram, telex, facsimile
transmission or letter
39
setting forth the name of the Holder, the principal amount of the Note the
Holder delivered for purchase and a statement that such Xxxxxx is withdrawing
his election to have such Note purchased; (h) that, if the aggregate principal
amount of Notes surrendered by Holders exceeds the Offer Amount, Stater Bros.
shall select the Notes to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by Stater Bros. so that only Notes in
denominations of $1,000, or integral multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be issued new
Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, Stater Bros. shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by Stater Bros. in
accordance with the terms of this Section 3.09. Stater Bros., the Depositary or
------------
the Paying Agent, as the case may be, shall promptly (but in any case not later
than five days after the Purchase Date) mail or deliver to each tendering Holder
an amount equal to the purchase price of the Notes tendered by such Holder and
accepted by Stater Bros. for purchase, and Stater Bros. shall promptly issue a
new Note, and the Trustee, upon written request from Stater Bros., shall
authenticate and mail or deliver such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered. Any Note not
so accepted shall be promptly mailed or delivered by Stater Bros. to the Holder
thereof. Stater Bros. shall publicly announce the results of the Asset Sale
Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
------------
pursuant to this Section 3.09 shall be made pursuant to the provisions of
------------
Sections 3.01 through 3.06 hereof.
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ARTICLE 4.
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
Stater Bros. shall pay or cause to be paid the principal of, premium,
if any, and interest and Liquidated Damages, if any, on the Notes on the dates
and in the manner provided in the Notes. Principal, premium, if any, and
interest and Liquidated Damages, if any, shall be considered paid on the date
due if the Paying Agent, if other than Stater Bros. or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by Stater
Bros. in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest and Liquidated Damages, if any,
then due. Except as otherwise provided in this Indenture or the Notes, Stater
Bros. shall pay all Liquidated Damages, if any, in the same manner on the dates
and in the amounts set forth in the Registration Rights Agreement, without
duplication.
Stater Bros. shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate equal
to 1% per annum in excess of
40
the then applicable interest rate on the Notes to the extent lawful; it shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated Damages
(without regard to any applicable grace period) at the same rate to the extent
lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
Stater Bros. shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon Stater Bros. in respect of the Notes and this Indenture may
be served. Stater Bros. shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time Stater Bros. shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
Stater Bros. may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve
Stater Bros. of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. Stater Bros. shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
Stater Bros. hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of Stater Bros. in accordance with Section
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2.03.
----
SECTION 4.03. REPORTS.
Whether or not required by the Commission, so long as any Notes are
outstanding, Stater Bros. shall furnish to the Holders of Notes, within the time
periods specified in the Commission's rules and regulations:
(a) all quarterly and annual financial information that would be required
to be contained in a filing with the Commission on Forms 10-Q and 10-K if
Stater Bros. were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
and, with respect to the annual information only, a report on the annual
financial statements by Stater Bros.' certified independent accountants; and
(b) all current reports that would be required to be filed with the
Commission on Form 8-K if Stater Bros. were required to file such reports.
In addition, whether or not required by the Commission, Stater Bros.
shall file a copy of all of the information and reports referred to in clauses
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(a) and (b) above with the Commission for public availability within the time
--- ---
periods specified in the Commission's rules
41
and regulations (unless the Commission will not accept such a filing) and make
such information available to securities analysts and prospective investors upon
request. Moreover, Stater Bros. agrees that, for so long as any Notes remain
outstanding, it shall furnish to the Holders and to securities analysts and
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) Stater Bros. shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of Stater Bros. and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether Stater Bros. has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge Stater Bros.
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action Stater Bros. is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action Stater Bros. is taking or proposes to take with respect thereto. For
purposes this paragraph, such compliance shall be determined without regard to
any period of grace or requirement of notice under this Indenture.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, at the time the Officers'
Certificate required by Section 4.03(a) is delivered, Stater Bros. shall cause
---------------
to be delivered to the Trustee a letter or statement of Stater Bros.'
independent accountants who shall have certified the financial statements of
Stater Bros. for its preceding fiscal year in connection with the annual report
of Stater Bros. to its stockholders for such year to the effect that, in making
the examination necessary for certification of such financial statements,
nothing came to their attention that caused them to believe that Stater Bros.
was not in compliance with any of the terms or conditions contained in Sections
--------
4.01, 4.05, 4.07, 4.08, 4.09, 4.10, 4.11, 4.15, 4.16, 4.18 and Article 5 of this
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ---------
Indenture, which Default remains uncured at the date of such letter or statement
or, if they shall have obtained knowledge of any such uncured Default,
specifying in such letter or statement such Default or Defaults and the nature
thereof, it being understood that such accountants shall not be liable directly
or indirectly for failure to obtain knowledge of any such Default or Defaults
and that their examinations was not directed primarily toward obtaining
knowledge of such noncompliance.
(c) Stater Bros. shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action Stater Bros. is taking or proposes to take with
respect thereto.
42
SECTION 4.05. TAXES.
Stater Bros. shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and governmental
levies except such as are contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders of the Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
Stater Bros. covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and Stater Bros. (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other payment or distribution
on account of Stater Bros.' or any of its Restricted Subsidiaries' Equity
Interests (including, without limitation, any such payment in connection with
any merger or consolidation involving Stater Bros. or any of its Restricted
Subsidiaries) or to the direct or indirect holders of Stater Bros.' or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of Stater Bros. or payable to Stater Bros. or a Restricted
Subsidiary of Stater Bros.);
(b) purchase, redeem or otherwise acquire or retire for value (including,
without limitation, in connection with any merger or consolidation involving
Stater Bros.) any Equity Interests of Stater Bros. or any direct or indirect
parent or Affiliate of Stater Bros.;
(c) make any payment on or with respect to, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness that is subordinated to
the Notes, except a payment of interest or principal at the Stated Maturity
thereof; or
(d) make any Restricted Investment (all such payments and other actions set
forth in clauses (a) through (d) above being collectively referred to as
"Restricted Payments"),
unless such Restricted Payment occurs on or after September 27, 1999 and, at the
time of and after giving effect to such Restricted Payment:
43
(i) no Default or Event of Default shall have occurred or be continuing
or would occur as a consequence thereof; and
(ii) Stater Bros. would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made
at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test set forth in the first paragraph of Section 4.09;
------------
and
(iii) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by Stater Bros. and its Restricted
Subsidiaries after the date of this Indenture (excluding Restricted Payments
permitted by clauses (b), (c), (d), (e), (f), (g), (i), (j) and (k) of the
next succeeding paragraph), is less than the sum, without duplication, of:
(A) 50% of the Consolidated Net Income of Stater Bros. for the
period (taken as one accounting period) from the beginning of the first
fiscal quarter commencing after the date of this Indenture to the end of
Stater Bros.' most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted Payment
(or, if such Consolidated Net Income for such period is a deficit, less
100% of such deficit), plus
(B) 100% of the aggregate net cash proceeds received by Stater Bros.
since the date of this Indenture as a contribution to its common equity
capital or from the issue or sale of Equity Interests of Stater Bros.
(other than Disqualified Stock) or from the issue or sale of convertible
or exchangeable Disqualified Stock or convertible or exchangeable debt
securities of Stater Bros. that have been converted into or exchanged for
such Equity Interests (other than Equity Interests (or Disqualified Stock
or debt securities) sold to a Restricted Subsidiary of Stater Bros. or to
Santee or Santee LLC), plus
(C) to the extent that any Restricted Investment that was made after
the date of this Indenture is sold for cash or otherwise liquidated or
repaid for cash, the lesser of (I) the cash return of capital with
respect to such Restricted Investment (less the cost of disposition, if
any) and (II) the initial amount of such Restricted Investment; plus
(D) an amount equal to the fair market value of the Equity Interests
of each Unrestricted Subsidiary that has been redesignated as a
Restricted Subsidiary pursuant to the terms of this Indenture; provided,
that such amount shall not in any case exceed the amount of Restricted
Investments previously made by Stater Bros. or any Restricted Subsidiary
in such Person; plus
(E) $5.0 million.
The preceding paragraph shall not prohibit:
44
(a) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would have
complied with the provisions of this Indenture;
(b) if no Default or Event of Default shall have occurred and be continuing
or would be caused thereby, the redemption, repurchase, retirement, defeasance
or other acquisition of any subordinated Indebtedness of Stater Bros. or of any
Equity Interests of Stater Bros. in exchange for, or out of the net cash
proceeds of the substantially concurrent sale (other than to a Restricted
Subsidiary of Stater Bros.) of, Equity Interests of Stater Bros. (other than
Disqualified Stock); provided that the amount of any such net cash proceeds that
are utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition shall be excluded from clause (iii)(B) of the preceding
paragraph;
(c) if no Default or Event of Default shall have occurred and be continuing
or would be caused thereby, the defeasance, redemption, repurchase or other
acquisition of subordinated Indebtedness of Stater Bros. with the net cash
proceeds from an incurrence of Permitted Refinancing Indebtedness;
(d) the payment of any dividend by a Restricted Subsidiary of Stater Bros.
to the holders of its Equity Interests on a pro rata basis;
(e) the payment to Xx Xxxxxx Investments of an amount equal to 1% of the
aggregate principal amount of the Notes issued on the date of this Indenture for
advisory services rendered in connection therewith;
(f) the payment of any costs and expenses (including any related premium)
in connection with:
(i) the offering of the Notes and the tender offer and consent
solicitation for Stater Bros.' 11% Senior Notes due 2001 and 9% Senior
Subordinated Notes due 2004 and
(ii) the acquisition of certain supermarkets and one store site pursuant
to the Asset Purchase Agreement, including all costs and expenses incidental
to the foregoing;
(g) the payment to Xx Xxxxxx Investments or any Xx Xxxxxx Successor of an
amount equal to the lesser of the amount of
(i) the sum of (X) any Qualified Xx Xxxxxx Investment, plus (Y) an amount
----
equal to a commercially reasonable rate of interest on such Qualified Xx
Xxxxxx Investment to the extent that the net proceeds received by Stater
Bros. Markets from the sale or disposition of that portion of Stater Bros.
Markets' interest in Santee LLC which was acquired with the proceeds from
such Qualified Xx Xxxxxx Investment exceeds the original amount of the
Qualified Xx Xxxxxx Investment; and
45
(ii) net proceeds received by Stater Bros. Markets from the sale or
disposition of that portion of Stater Bros. Markets' interest in Santee LLC
which was acquired with the proceeds from such Qualified Xx Xxxxxx
Investment;
(h) if no Default or Event of Default shall have occurred and be continuing
or would be caused thereby, other Investments in any Person having an aggregate
fair market value (measured on the date each such Investment was made and
without giving effect to subsequent changes in value), when taken together with
all other Investments made pursuant to this clause (h) since the date of this
----------
Indenture not to exceed $5 million;
(i) if no Default or Event of Default shall have occurred and be continuing
or would be caused thereby, the repurchase, redemption or other acquisition or
retirement for value of any Equity Interests of Stater Bros. held by any key
employee of Stater Bros. or its Restricted Subsidiaries (other than any key
employee that is a partner of or otherwise holds any Equity Interest in Xx
Xxxxxx Investments or any Xx Xxxxxx Successor) upon any such person's death,
disability or termination of employment and pursuant to any management equity
subscription agreement, stock option agreement or other incentive compensation
plan or agreement entered into in the ordinary course of business; provided that
the aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests shall not exceed $500,000, which aggregate amount shall
increase by $500,000 on each anniversary of the date of this Indenture;
(j) payment of dividends on the Markets Preferred Stock as outstanding and
in effect on the date of this Indenture not to exceed $5,000 per year; and
(k) any redemption or repurchase of the Markets Preferred Stock outstanding
on the date of this Indenture, provided that the aggregate cash payments made
with respect to such redemption or repurchase shall not exceed $50,000.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued to or by Stater Bros. or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be valued
by this Section 4.07 shall be determined by a majority of Stater Bros.'
------------
directors whose resolution with respect thereto shall be delivered to the
Trustee. Not later than the date of making any Restricted Payment (other than
Restricted Payments permitted pursuant to clauses (a), (d), (e), (f), (j) and
----------- --- --- --- ---
(k) of the preceding paragraph), Stater Bros. shall deliver to the Trustee an
---
Officers' Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by this Section
-------
4.07 were computed.
----
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction of any kind: (i) on the
ability of any Restricted Subsidiary to: (A) pay dividends or make any other
distributions on its Capital Stock to Stater Bros. or any of its Restricted
Subsidiaries, or with respect to any other interest or participation in, or
measured by, its profits,
46
or pay any indebtedness owed to Stater Bros. or any of its Restricted
Subsidiaries; (B) make loans or advances to Stater Bros. or any of its
Restricted Subsidiaries; or (C) transfer any of their respective properties or
assets to Stater Bros. or any of its Restricted Subsidiaries; (ii) on the
ability of Stater Bros. or any of its Restricted Subsidiaries to receive or
retain any such: (A) dividends, payments or distributions, (B) loans or
advances, or (C) transfer of property (any such restriction being referred to
herein as a "Payment Restriction").
However, the restrictions in the preceding paragraph shall not apply
to encumbrances or restrictions existing under or by reason of: (i) agreements
in effect as of the date of this Indenture and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings thereof (provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in such Existing
Indebtedness, as in effect on the date of this Indenture) or any provisions of
any articles of incorporation or certificate of incorporation with respect to
Stater Bros. or any Restricted Subsidiary (including without limitation the
rights, preferences and privileges of any class or series of preferred stock
included therein) in effect as of the date of this Indenture; (ii) this
Indenture and the Notes; (iii) applicable law; (iv) any instrument governing
Indebtedness or Capital Stock of a Person acquired by Stater Bros. or any of its
Subsidiaries as in effect at the time of such acquisition (except to the extent
such Indebtedness was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired, provided that, in the case of
Indebtedness, such Indebtedness was permitted by the terms of this Indenture to
be incurred; (v) customary non-assignment provisions in leases and other
contracts entered into in the ordinary course of business; (vi) purchase money
obligations for property acquired in the ordinary course of business that impose
restrictions on the property so acquired of the nature described in clause (C)
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of the preceding paragraph; (vii) Permitted Refinancing Indebtedness, provided
that the restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive, taken as a whole, than those
contained in the agreements governing the Indebtedness being refinanced; (viii)
the Revolving Credit Facility; (ix) Liens securing Indebtedness that limit the
right of the debtor to dispose of the assets subject to such Lien; and (x)
restrictions on cash or other deposits or net worth imposed by customers under
contracts entered into in the ordinary course of business.
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), and Stater Bros. shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of preferred
stock; provided, however, that if no Default or Event of Default shall have
occurred and be continuing at the time or as a consequence of the incurrence of
such Indebtedness, Stater Bros. may incur Indebtedness (including Acquired Debt)
or issue Disqualified Stock if the Fixed Charge
47
Coverage Ratio for Stater Bros.' most recently ended four full fiscal quarters
for which internal financial statements are available immediately preceding the
date on which such additional Indebtedness is incurred or such Disqualified
Stock is issued would have been at least 2.0 to 1, determined on a pro forma
basis (including a pro forma application of the net proceeds therefrom), as if
the additional Indebtedness had been incurred or the Disqualified Stock had been
issued, as the case may be, at the beginning of such four-quarter period.
The first paragraph of this Section 4.09 shall not prohibit the
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incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(a) the incurrence by Stater Bros. or its Restricted Subsidiaries of
Indebtedness in an aggregate principal amount not to exceed $50.0 million at any
time outstanding under any Credit Facilities or any replacement facility
thereof;
(b) the incurrence by Stater Bros. and its Restricted Subsidiaries of the
Existing Indebtedness;
(c) the incurrence by Stater Bros. of Indebtedness represented by the
Initial Notes and the Exchange Notes to be issued pursuant to the Registration
Rights Agreement;
(d) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Acquired Debt represented by Capital Lease Obligations, with respect to assets
acquired pursuant to the Acquisition, in an amount not to exceed $15.0 million
in the aggregate, including all Permitted Refinancing Indebtedness incurred to
refund, refinance or replace any Indebtedness incurred pursuant to this clause
------
(d);
---
(e) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Indebtedness represented by Capital Lease Obligations or of Permitted
Construction Indebtedness in an aggregate principal amount, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (e), not to exceed $25.0 million
----------
at any time outstanding;
(f) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which
are used to refund, refinance or replace Indebtedness (other than intercompany
Indebtedness) that was permitted by this Indenture to be incurred under the
first paragraph of this Section 4.09 or clauses (a), (b) or (c) of this
------------
paragraph;
(g) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
intercompany Indebtedness between or among Stater Bros. and any of its Wholly-
Owned Subsidiaries (other than an Unrestricted Subsidiary); provided, however,
that: (i) if Stater Bros. is the obligor on such Indebtedness, such
Indebtedness must be expressly subordinated to the prior payment in full in cash
of all Obligations with respect to the Notes; and (ii)(A) any subsequent
issuance or transfer of Equity Interests that results in any such Indebtedness
being held by a Person other than Stater Bros. or a Restricted Subsidiary
thereof and (B) any sale or other transfer of any such Indebtedness to a Person
that is not either Stater Bros. or a Wholly-
48
Owned Subsidiary (other than an Unrestricted Subsidiary) thereof, shall be
deemed, in each case, to constitute an incurrence of such Indebtedness by Stater
Bros. or such Restricted Subsidiary, as the case may be, that was not permitted
by this clause (g);
----------
(h) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Hedging Obligations that are incurred for the purpose of fixing or hedging
interest rate risk with respect to any floating rate Indebtedness that is
permitted by the terms of this Indenture to be outstanding;
(i) the guarantee by Stater Bros. of Indebtedness of Stater Bros. or a
Restricted Subsidiary of Stater Bros. that was permitted to be incurred by
another provision of this Section 4.09;
------------
(j) the accrual of interest, the accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms, and the payment of dividends on
Disqualified Stock in the form of additional shares of the same class of
Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an
issuance of Disqualified Stock for purposes of Section 4.09; provided, in each
------------
such case, that the amount thereof is included in Fixed Charges of Stater Bros.
as accrued;
(k) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Indebtedness to secure workers' compensation and other insurance coverages, not
to exceed the minimum amount required by Stater Bros.' or any of its Restricted
Subsidiaries' insurance carriers or applicable regulatory agencies (which may be
Indebtedness under Credit Facilities in addition to that permitted under clause
------
(a));
---
(l) the incurrence by Stater Bros. of Indebtedness to Xx Xxxxxx Investments
incurred by Stater Bros. in connection with a Qualified Xx Xxxxxx Investment;
provided, however, that the repayment of principal with respect to, and the
payment of interest with respect to, any such Qualified Xx Xxxxxx Investment
constituting Indebtedness shall be subject to Section 4.07;
------------
(m) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
Indebtedness represented by letters of credit entered into as security for the
obligations of Stater Bros. or any of its Restricted Subsidiaries pursuant to
any or all of the Petrolane Leases;
(n) the incurrence of Indebtedness arising from agreements of Stater Bros.
or any Restricted Subsidiary providing for indemnification, adjustment of
purchase price or similar obligations, or from guarantees or letters of credit,
surety bonds or performance bonds securing any obligations of Stater Bros. or
any Restricted Subsidiary pursuant to such agreements, incurred or assumed in
connection with the disposition of any business, assets or Subsidiary of Stater
Bros. or any Restricted Subsidiary, other than guarantees or similar credit
support by Stater Bros. or such Restricted Subsidiary of Indebtedness incurred
by any Person acquiring all or any portion of such business, assets or
Subsidiary for the purpose of financing such acquisition; provided that the
maximum aggregate liability in respect of all such Indebtedness described in
this clause (n) shall not exceed the net proceeds actually received in
----------
connection with any such disposition; and
49
(o) the incurrence by Stater Bros. or any of its Restricted Subsidiaries of
other Indebtedness not to exceed $25.0 million (which may be Indebtedness under
Credit Facilities in addition to that permitted by clause (a)).
----------
Stater Bros. shall not incur any Indebtedness (including Permitted Debt)
that is contractually subordinated in right of payment to any other Indebtedness
of Stater Bros. unless such Indebtedness is also contractually subordinated in
right of payment to the Notes on substantially identical terms; provided,
however, that no Indebtedness of Stater Bros. shall be deemed to be
contractually subordinated in right of payment to any other Indebtedness of
Stater Bros. solely by virtue of being unsecured.
For purposes of determining compliance with this Section 4.09, in the
------------
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (a) through (o) above,
or is entitled to be incurred pursuant to the first paragraph of this Section
-------
4.09, Stater Bros. shall be permitted to classify such item of Indebtedness on
----
the date of its incurrence, or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this Section 4.09.
------------
Indebtedness under the Revolving Credit Facility outstanding on the
date on which Notes are first issued and authenticated under this Indenture
shall be deemed to have been incurred on such date in reliance on the exception
provided by clause (a) of the definition of Permitted Debt above.
Section 4.10. Asset Sales
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale (other than a Qualified Santee LLC
Interest Sale) unless: (a) Stater Bros. (or such Restricted Subsidiary, as the
case may be) receives consideration at the time of such Asset Sale at least
equal to the fair market value of the assets or Equity Interests issued or sold
or otherwise disposed of; (b) such fair market value is evidenced by (i) for any
Asset Sale resulting in Net Proceeds less than or equal to $1.0 million, an
Officers' Certificate delivered to the Trustee or (ii) for any Asset Sale
resulting in Net Proceeds in excess of $1.0 million, a resolution of Stater
Bros.' Board of Directors set forth in an Officers' Certificate delivered to the
Trustee; and (c) at least 75% of the consideration therefor received by Stater
Bros. or such Restricted Subsidiary is in the form of cash. For purposes of
this provision, each of the following shall be deemed to be cash: (a) any
liabilities (as shown on Stater Bros.' or such Restricted Subsidiary's most
recent balance sheet) of Stater Bros. or any Restricted Subsidiary (other than
contingent liabilities and liabilities that are by their terms subordinated to
the Notes) that are assumed by the transferee of any such assets pursuant to a
customary novation agreement that releases Stater Bros. or such Restricted
Subsidiary from further liability; and (b) any securities, notes or other
obligations received by Stater Bros. or any such Restricted Subsidiary from such
transferee that are contemporaneously (subject to ordinary settlement periods)
converted by Stater Bros. or such Restricted Subsidiary into cash (to the extent
of the cash received in that conversion); provided, that any non-cash
consideration that becomes Net
50
Proceeds shall thereafter be subject to the provisions of the second paragraph
of this Section 4.10.
Upon the date of consummation of any Asset Sale by Stater Bros. or any
Restricted Subsidiary which, taken individually or together with all such Asset
Sales since the date of this Indenture, results in the receipt of Net Proceeds
in excess of $10.0 million, such Net Proceeds and all Net Proceeds from all such
Asset Sales consummated concurrently therewith or consummated thereafter (such
first consummation date and each such date thereafter, a "Consummation Date")
shall be applied by Stater Bros. or such Restricted Subsidiary within 12 months
of the relevant Consummation Date (or, in the event of a Qualified Santee LLC
Interest Sale, within 24 months of the relevant Consummation Date) at its
election to either: (a) investments in assets or businesses in the same line of
business as Stater Bros. or such Restricted Subsidiary; (b) the permanent
repayment of (and permanent reduction of commitments, if any, under) any
Indebtedness (i) that is secured by or incurred to construct such assets or (ii)
of a Restricted Subsidiary; (c) a combination of payment and investment
permitted by the foregoing clauses (a) and (b); or (d) pending the final
----------- ---
application of any such Net Proceeds, the temporary reduction of revolving
credit borrowings or other investment of such Net Proceeds in any manner that is
not prohibited by this Indenture.
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in clauses (a), (b) or (c) of the preceding paragraph shall constitute
----------- --- ---
"Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10.0
million, Stater Bros. shall make an Asset Sale Offer in accordance with Section
-------
3.09 to all Holders of Notes and all holders of other Indebtedness that is pari
----
passu with the Notes containing provisions similar to those set forth in this
Indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets to purchase the maximum principal amount of Notes and such other
pari passu Indebtedness that may be purchased out of such Excess Proceeds. The
offer price in any Asset Sale Offer will be equal to 100% of principal amount
plus accrued and unpaid interest and Liquidated Damages, if any, to the date of
purchase, and will be payable in cash. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, Stater Bros. or such Restricted Subsidiary
may use such Excess Proceeds for any purpose not otherwise prohibited by this
Indenture. If the aggregate principal amount of Notes and such other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of such
Excess Proceeds, the Trustee shall select the Notes and such other pari passu
Indebtedness to be purchased on a pro rata basis based on the principal amount
of Notes and such other pari passu Indebtedness tendered. Upon completion of
each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.
Stater Bros. shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this Indenture, Stater Bros. shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under the Asset Sale provisions of this Indenture by virtue of such
conflict.
51
Section 4.11. Transactions with Affiliates.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each, an "Affiliate Transaction"), unless: (a) such
Affiliate Transaction is on terms that are consistent with industry practice and
no less favorable to Stater Bros. or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by Stater Bros.
or such Restricted Subsidiary with an unrelated Person; and (b) with respect to
any Affiliate Transaction or series of related Affiliate Transactions involving
aggregate consideration in excess of $1.0 million, Stater Bros. delivers to the
Trustee a resolution of the Board of Directors set forth in an Officers'
Certificate certifying that such Affiliate Transaction complies with this
covenant and that such Affiliate Transaction has been approved by a majority of
the members of the Board of Directors.
The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of the prior paragraph:
(a) transactions, to the extent not otherwise prohibited under this Indenture,
between or among Stater Bros. and/or its Wholly-Owned Subsidiaries; (b)
transactions contemplated by the Santee Documents, as amended, modified,
renewed, refunded or replaced from time to time; provided, that such
transactions are not otherwise prohibited by this Indenture; (c) payment of
reasonable directors fees to directors of Stater Bros.; (d) sales of Equity
Interests (other than Disqualified Stock) to Affiliates of Stater Bros.; (e)
payment to Xx Xxxxxx Investments of an amount equal to 1% of the aggregate
principal amount of the Initial Notes for advisory services rendered in
connection therewith; and (f) Restricted Payments that are permitted by the
provisions of Section 4.07 hereof.
------------
Section 4.12. Liens.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind on any asset now owned or hereafter acquired, except
Permitted Liens.
Section 4.13. Corporate Existence.
Subject to Article 5 hereof, Stater Bros. shall do or cause to be done
---------
all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Subsidiaries, in accordance with the respective organizational documents
(as the same may be amended from time to time) of Stater Bros. or any such
Subsidiary and (ii) the rights (charter and statutory), licenses and franchises
of Stater Bros. and its Subsidiaries; provided, however, that Stater Bros. shall
not be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Subsidiaries, if the
Board of Directors of Stater Bros. shall determine that the preservation thereof
is no longer desirable in the conduct of the business of Stater Bros. and its
52
Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any
material respect to the Holders of the Notes.
Section 4.14. Offer to Repurchase Upon Change of Control.
If a Change of Control occurs, each Holder of Notes will have the
right to require Stater Bros. to repurchase all or any part (equal to $1,000 or
an integral multiple thereof) of that Xxxxxx's Notes pursuant to a Change of
Control Offer. In the Change of Control Offer, Stater Bros. shall offer a
payment in cash equal to 101% of the aggregate principal amount of Notes
repurchased plus accrued and unpaid interest and Liquidated Damages, if any,
thereon, to the date of purchase (the "Change of Control Payment"). Within 30
days following any Change of Control, Stater Bros. shall mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and offering to repurchase Notes on the date specified in such notice
(the "Change of Control Payment Date"), which date shall be no earlier than 30
days and no later than 60 days from the date such notice is mailed, pursuant to
the procedures required by this Indenture and described in such notice. Stater
Bros. shall comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such laws
and regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control. To the extent that the provisions of any
securities laws or regulations conflict with this Section 4.14, Stater Bros.
------------
will comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 4.14 by virtue of
------------
such conflict.
On the Change of Control Payment Date, Stater Bros. shall, to the
extent lawful: (i) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer; (ii) deposit with the Paying
Agent an amount equal to the Change of Control Payment in respect of all Notes
or portions thereof so tendered; and (iii) deliver or cause to be delivered to
the Trustee the Notes so accepted together with an Officers' Certificate stating
the aggregate principal amount of Notes or portions thereof being purchased by
Stater Bros.
The Paying Agent shall promptly mail to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered, if any; provided that each such new Note shall be in a
principal amount of $1,000 or an integral multiple thereof.
Prior to complying with any of the provisions of this Section 4.14,
------------
but in any event within 90 days following a Change of Control, Stater Bros.
shall either (i) cause each of its Restricted Subsidiaries to obtain the
requisite consents, if any, under all agreements governing outstanding
Indebtedness of such Restricted Subsidiary to permit the repurchase of Notes
required by this Section 4.14 or (ii) if any of such requisite consents cannot
------------
be obtained, cause the applicable Restricted Subsidiary or Restricted
Subsidiaries to repay the Indebtedness pursuant to which such consent is
required.
Stater Bros. shall publicly announce the results of the Change of
Control Offer on or as soon as practicable after the Change of Control Payment
Date.
53
Stater Bros. shall not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth in this Section 4.14 and purchases all Notes validly tendered and not
------------
withdrawn under such Change of Control Offer.
Section 4.15. Limitation On Issuances And Sales Of Equity Interests In Wholly-
Owned Subsidiaries (Other Than An Unrestricted Subsidiary).
Stater Bros. shall not, and shall not permit any of its Wholly-Owned
Subsidiaries (other than an Unrestricted Subsidiary) to, transfer, convey, sell,
lease or otherwise dispose of any Equity Interests in any Wholly-Owned
Subsidiary (other than an Unrestricted Subsidiary) of Stater Bros. to any Person
(other than Stater Bros. or a Wholly-Owned Subsidiary of Stater Bros.), unless:
(a) such transfer, conveyance, sale, lease or other disposition is of all the
Equity Interests in such Restricted Subsidiary; and (b) the cash Net Proceeds
from such transfer, conveyance, sale, lease or other disposition are applied in
accordance with Sections 3.09 and 4.10. In addition, Stater Bros. shall not
------------- ----
permit any Wholly-Owned Subsidiary (other than an Unrestricted Subsidiary) of
Stater Bros. to issue any of its Equity Interests (other than, if necessary,
shares of its Capital Stock constituting directors' qualifying shares) to any
Person other than to Stater Bros. or a Wholly-Owned Subsidiary (other than an
Unrestricted Subsidiary) of Stater Bros.
Section 4.16. Limitation on Issuances of Guarantees of Indebtedness.
Stater Bros. shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to Guarantee or pledge any assets to secure the payment
of any other Indebtedness of Stater Bros. with a principal amount in excess of
an aggregate of $10.0 million unless such Restricted Subsidiary simultaneously
executes and delivers a supplemental indenture providing for the Guarantee of
the payment of the Notes by such Restricted Subsidiary, which Guarantee shall be
senior to or pari passu with such Subsidiary's Guarantee of or pledge to secure
such other Indebtedness.
Section 4.17. Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors of Stater Bros. may designate any Subsidiary
(including any newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary unless such Subsidiary owns any Capital Stock of any Wholly-Owned
Subsidiary of Stater Bros. other than a Wholly-Owned Subsidiary of such
Subsidiary; provided, that Stater Bros. shall have provided the Trustee with an
Officers' Certificate accompanied by a resolution of the Board of Directors of
Stater Bros. stating that (x) such designation complies with Section 4.07 hereof
------------
and (y) such designation shall not otherwise result in any Default or Event of
Default. The Board of Directors of Stater Bros. may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary only if (x) immediately after giving
effect to such designation, Stater Bros. is able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in compliance with
Section 4.09 hereof and (y) immediately before and immediately after giving
------------
effect to such designation, no Default or Event of Default shall have occurred
and be continuing. Any such designation by the Board of Directors of Stater
Bros. shall be evidenced to the Trustee by promptly providing the
54
Trustee a copy of the board resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with this
Section 4.17.
------------
Section 4.18. Payments For Consent.
Stater Bros. shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
and is paid to all Holders of the Notes that consent, waive or agree to amend in
the time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 5.
SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets.
Stater Bros. shall not, directly or indirectly: (x) consolidate or
merge with or into another Person (whether or not Stater Bros. is the surviving
corporation); or (y) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of Stater Bros. and its
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person; unless:
(a) either: (i) Stater Bros. would be the surviving corporation; or (ii)
the Person formed by or surviving any such consolidation or merger (if other
than Stater Bros.) or to which such sale, assignment, transfer, conveyance or
other disposition shall have been made would be a corporation organized or
existing under the laws of the United States, any state thereof or the District
of Columbia;
(b) the Person formed by or surviving any such consolidation or merger (if
other than Stater Bros.) or the Person to which such sale, assignment, transfer,
conveyance or other disposition shall have been made assumes all the obligations
of Stater Bros. under the Notes, this Indenture and the Registration Rights
Agreement pursuant to agreements reasonably satisfactory to the Trustee;
(c) immediately after giving effect to such transaction (including giving
effect to any Indebtedness incurred or anticipated to be incurred in connection
with or in respect of such transaction) no Default or Event of Default would
exist or be continuing; and
(d) Stater Bros. or the Person formed by or surviving any such
consolidation or merger (if other than Stater Bros.), or to which such sale,
assignment, transfer, conveyance or other disposition shall have been made: (i)
would have Consolidated Net Worth immediately after the transaction equal to or
greater than the Consolidated Net Worth of Stater Bros. immediately preceding
the transaction; and (ii) would, on the date of such transaction after giving
pro forma effect thereto and any related financing transactions as if the same
had occurred at the beginning of the applicable four-quarter period, be
permitted to incur at least $1.00 of
55
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in the first paragraph of Section 4.09; and
------------
(e) Stater Bros. or such Person shall have delivered to the Trustee (i) an
Officers' Certificate of Stater Bros. and an Opinion of Counsel (which counsel
may not be in-house counsel of Stater Bros.), each stating that such
consolidation, merger, conveyance, transfer or lease and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture, comply with this Section 5.01 and that all conditions precedent in
------------
this Indenture relating to such transaction have been satisfied and (ii) a
certificate from Stater Bros.' independent certified public accountants stating
that Stater Bros. has made the calculations required by clause (d) above in
accordance with the terms of this Indenture.
In addition, Stater Bros. shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, lease all or substantially
all of its properties or assets, in one or more related transactions, to any
other Person.
Notwithstanding the foregoing, this Section 5.01 shall not apply to a
------------
sale, assignment, transfer, conveyance or other disposition of assets between or
among Stater Bros. and any of its Restricted Subsidiaries.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of Stater Bros. in accordance with Section 5.01 hereof, the successor
------------
corporation formed by such consolidation or into or with which Stater Bros. is
merged or to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for (so that from and
after the date of such consolidation, merger, sale, lease, conveyance or other
disposition, the provisions of this Indenture referring to "Stater Bros." shall
refer instead to the successor corporation and not to Stater Bros.), and may
exercise every right and power of Stater Bros. under this Indenture with the
same effect as if such successor Person had been named as Stater Bros. herein;
provided, however, that the predecessor Stater Bros. shall not be relieved from
the obligation to pay the principal of and interest on the Notes except in the
case of a sale of all of Stater Bros.' assets that meets the requirements of
Section 5.01 hereof.
------------
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
Each of the following shall constitute an "Event of Default": (i)
default for 30 days in the payment when due of interest on, or Liquidated
Damages with respect to, the Notes; (ii) default in payment when due of the
principal of, or premium, if any, on the Notes; (iii) failure by Stater Bros. or
any of its Restricted Subsidiaries to comply with Section 3.09, 4.10, 4.14 or
------------ ---- ----
5.01; (iv) failure by Stater Bros. or any of its Restricted Subsidiaries for 60
----
days after notice to
56
comply with any of the other agreements in this Indenture or the Notes (other
than a default set forth in clauses (i), (ii) or (iii) above); (v) default under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed by
Stater Bros. or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by Stater Bros. or any of its Restricted Subsidiaries) whether such
Indebtedness or guarantee now exists, or is created after the date of this
Indenture, if that default: (A) is caused by a failure to pay principal of, or
interest or premium, if any, on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default (a
"Payment Default"); or (B) results in the acceleration of such Indebtedness
prior to its express maturity, and, in each case, the principal amount of any
such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity of
which has been so accelerated, aggregates $5.0 million or more; (vi) failure by
Stater Bros. or any of its Restricted Subsidiaries to pay final judgments to the
extent not covered by insurance underwritten by third parties aggregating in
excess of $2.0 million, which judgments shall not have been paid, discharged or
stayed for a period of 60 days; (vii) Stater Bros. or any of its Restricted
Subsidiaries pursuant to or within the meaning of Bankruptcy Law: (A) commences
a voluntary case for relief from its creditors; (B) consents to the entry of an
order for relief against it in an involuntary case for relief from its
creditors; (C) consents to the appointment of a custodian of it or for all or
substantially all of its property; (D) makes a general assignment for the
benefit of its creditors; or (E) admits in writing its inability generally to
pay its debts as they become due; or (viii) a court of competent jurisdiction
enters an order or decree under any Bankruptcy Law that: (A) is for relief
against Stater Bros. or any of its Restricted Subsidiaries in an involuntary
case; (B) appoints a custodian of Stater Bros. or any of its Restricted
Subsidiaries or for all or substantially all of the property of Stater Bros. or
any of its Restricted Subsidiaries; or (C) orders the liquidation of Stater
Bros. or any of its Restricted Subsidiaries; and the order or decree remains
unstayed and in effect for 60 consecutive days.
Section 6.02. Acceleration.
If any Event of Default other than an Event of Default described in
clauses (vii) or (viii) above occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare the principal of and accrued interest and Liquidated Damages, if any, on
all the Notes to be due and payable immediately by notice in writing to Stater
Bros. and the Trustee specifying the respective Event of Default and that such
notice is a "notice of acceleration" (the "Acceleration Notice"), and the same
shall become immediately and automatically due and payable. Notwithstanding the
foregoing, if an Event of Default specified in clause (vii) of Section 6.01
------------
hereof occurs with respect to Stater Bros., all outstanding Notes shall be due
and payable immediately without further action or notice. The Holders of a
majority in aggregate principal amount of the then outstanding Notes by written
notice to the Trustee may on behalf of all of the Holders rescind an
acceleration and its consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest or Liquidated Damages that has become due solely because of
the acceleration) have been cured or waived.
57
If an Event of Default occurs by reason of any willful action (or
inaction) taken (or not taken) by or on behalf of Stater Bros. with the
intention of avoiding payment of the premium that Stater Bros. would have had to
pay if Stater Bros. then had elected to redeem the Notes pursuant to Section
-------
3.07 hereof, then, upon acceleration of the Notes, an equivalent premium shall
----
also become and be immediately due and payable, to the extent permitted by law,
anything in this Indenture or in the Notes to the contrary notwithstanding. If
an Event of Default occurs prior to August 15, 2003 by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of Stater Bros. with
the intention of avoiding the prohibition on redemption of the Notes prior to
such date, then, upon acceleration of the Notes, an additional premium shall
also become and be immediately due and payable to the extent permitted by law in
an amount, for each of the years beginning on August 15 of the years set forth
below, as set forth below (expressed as a percentage of the principal amount of
the Notes on the date of payment that would otherwise be due but for the
provisions of this sentence):
Year Percentage
---- ----------
1999 .................................. 116.1250%
2000 .................................. 113.4375%
2001 .................................. 110.7500%
2002 .................................. 108.0625%
2003 .................................. 105.3750%
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest and Liquidated Damages, if any, on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium and Liquidated Damages, if any, or interest
on, the Notes (including in connection with an offer to purchase). Upon any
such waiver, such Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
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Section 6.05. Control by Majority.
Holders of a majority in principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
Section 6.06. Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture
or the Notes only if: (a) the Holder of a Note gives to the Trustee written
notice of a continuing Event of Default; (b) the Holders of at least 25% in
principal amount of the then outstanding Notes make a written request to the
Trustee to pursue the remedy; (c) such Holder of a Note or Holders of Notes
offer and, if requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense; (d) the Trustee does not comply
with the request within 60 days after receipt of the request and the offer and,
if requested, the provision of indemnity; and (e) during such 60-day period the
Holders of a majority in principal amount of the then outstanding Notes do not
give the Trustee a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal, premium and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(i) or (ii) occurs and
--------------- ----
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against Stater Bros. for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including
59
any claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel) and the Holders of the Notes allowed in
any judicial proceedings relative to Stater Bros. (or any other obligor upon the
Notes), its creditors or its property and shall be entitled and empowered to
collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian in any such judicial proceeding
is hereby authorized by each Holder to make such payments to the Trustee, and in
the event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To
------------
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
------------
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
------------
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium and Liquidated Damages, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium and Liquidated Damages, if any and
interest, respectively; and
Third: to Stater Bros. or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
------------
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
60
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
------------
principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise as a prudent person would
exercise or use under the circumstances in the conduct of its own affairs.
(b) Except during the continuance of an Event of Default: (i) the duties
of the Trustee shall be determined solely by the express provisions of this
Indenture and the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and (ii) in
the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that: (i) this paragraph does not limit the effect of paragraph (b) of this
Section; (ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and (iii) the Trustee shall not
be liable with respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section 6.05 hereof.
------------
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights or powers under this Indenture at the
request or direction of any Holders, unless such Holder shall have offered to
the Trustee security and indemnity satisfactory to it against any loss, costs,
liabilities and/or expenses that might be incurred by it in connection with such
request or direction.
61
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with Stater Bros. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from Stater Bros. shall be sufficient if signed by
an Officer of Stater Bros.
(f) The Trustee shall be under no obligation to exercise any of its rights
or powers under this Indenture at the request or direction of any of the Holders
unless such Holders shall have offered to the Trustee security or indemnity
satisfactory to it against any loss, costs, liabilities and/or expenses that
might be incurred by it in connection with such request or direction.
Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with Stater Bros. or any
Affiliate of Stater Bros. with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest as described in the TIA as then in effect, it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
or resign. Any Agent may do the same with like rights and duties. The Trustee
is also subject to Sections 7.10 and 7.11 hereof.
------------- ----
62
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for Stater Bros.' use of the proceeds from the Notes or any money
paid to Stater Bros. or upon Stater Bros.' direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest or Liquidated Damages, if any, on any Note, the Trustee may withhold
the notice if and so long as a committee of its Responsible Officers in good
faith determines that withholding the notice is in the interests of the Holders
of the Notes.
Section 7.06. Reports by Trustee to Holders of the Notes.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA (S) 313(a) (but if no event described in
TIA (S) 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA
(S) 313(b)(2). The Trustee shall also transmit by mail all reports as required
by XXX (S) 313(c).
A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed to Stater Bros. and , if such report is prepared after the
Exchange Offer Registration Statement or the Shelf Registration Statement has
been declared effective by the SEC, filed with the SEC and each stock exchange
on which the Notes are listed in accordance with TIA (S) 313(d). Stater Bros.
shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
Section 7.07. Compensation and Indemnity.
Stater Bros. shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. Stater Bros. shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses
shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
63
Stater Bros. shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against Stater Bros. (including
this Section 7.07) and defending itself against any claim (whether asserted by
------------
Stater Bros. or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify Stater Bros. promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify
Stater Bros. shall not relieve Stater Bros. of its obligations hereunder.
Stater Bros. shall defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel and Stater Bros. shall pay the
reasonable fees and expenses of such counsel. Stater Bros. need not pay for any
settlement made without its consent, which consent shall not be unreasonably
delayed or withheld.
The obligations of Stater Bros. under this Section 7.07 shall survive
------------
the satisfaction and discharge of this Indenture.
To secure Stater Bros.' payment obligations in this Section, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(vii) or (viii) hereof occurs, the expenses and
----------------- ------
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
The Trustee shall comply with the provisions of TIA (S) 313(b)(2) to
the extent applicable.
Stater Bros.' obligations under this Section 7.07 and any claim
------------
arising hereunder shall survive the resignation or removal of any Trustee, the
discharge of Stater Bros.' obligations pursuant to Article 8 hereof and any
---------
rejection or termination under any Bankruptcy Law.
Section 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying Stater Bros. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and Stater Bros. in writing. Stater Bros.
may remove the Trustee if: (a) the Trustee fails to comply with Section 7.10
------------
hereof; (b) the Trustee is adjudged a bankrupt or an insolvent or an order for
64
relief is entered with respect to the Trustee under any Bankruptcy Law; (c) a
custodian or public officer takes charge of the Trustee or its property; or (d)
the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, Stater Bros. shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by Stater
Bros.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, Stater Bros., or
the Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
-------
7.10, such Holder of a Note may petition any court of competent jurisdiction for
----
the removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to Stater Bros. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the Trustee
------------
pursuant to this Section 7.08, Stater Bros.' obligations under Section 7.07
------------ ------------
hereof shall continue for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Xxxxxx, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100.0
million as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (S) 310(a)(1), (2) and (5). The Trustee is subject to TIA
(S) 310(b).
65
Section 7.11. Preferential Collection of Claims Against Stater Bros.
The Trustee is subject to TIA (S) 311(a), excluding any creditor
relationship listed in TIA (S) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (S) 311(a) to the extent indicated therein.
Section 7.12. Trustee Risk.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to it. Whether
or not expressly provided herein, every provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the Trustee
shall be subject to Section 7.01 hereof and the requirements of the TIA as then
------------
in effect.
Section 7.13. Appointment Of Co-Trustee.
It is the purpose of this Indenture that there shall be no violation
of any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as trustee in such
jurisdiction. It is recognized that in case of litigation under this Indenture,
and in particular in case of the enforcement of any such document on default, or
in case the Trustee deems that by reason of any present or future law of any
jurisdiction it may not exercise any of the powers, rights or remedies herein
granted to the Trustee or hold title to the properties in trust, as herein
granted, or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that the Trustee appoint an additional
individual or institution as a separate or co-trustee (the "Co-Trustee"). The
following provisions of this Section 7.13 are adopted to these ends.
------------
The Trustee shall, upon the prior written consent of Stater Bros.,
which shall not be unreasonably delayed or withheld, appoint an additional
individual or institution as a Co-Trustee. The Co-Trustee shall deliver a
written acceptance of its appointment to Stater Bros. Thereupon, the Co-Trustee
shall have all the rights, powers and duties of the Trustee under this
Indenture. The Trustee shall mail a notice of the appointment of the Co-Trustee
to Holders of the Notes.
In the event that the Trustee appoints a Co-Trustee, each and every
remedy, power, right, claim, demand, cause of action, immunity, estate, title,
interest and lien expressed or intended by this Indenture to be exercised by or
vested in or conveyed to the Trustee with respect thereto shall be exercisable
by and vested in such Co-Trustee but only to the extent necessary to enable such
Co-Trustee to exercise such powers, rights, and remedies, and every covenant and
obligation necessary to the exercise thereof by such Co-Trustee shall run to and
be enforceable by either of them.
Should any instrument in writing be required by the separate Co-
Trustee so appointed by the Trustee for xxxxxx and more certain vesting in and
confirming to him or it such
66
properties, rights, powers, trusts, duties and obligations, any and all such
instruments in writing shall, on request, be executed, acknowledged and
delivered by Stater Bros. In case any separate Co-Trustee, or a successor to
either, shall die, become incapable of acting, resign or be removed, all the
estates, properties, rights, powers, trusts, duties and obligations of such Co-
Trustee, so far as permitted by law, shall vest in and be exercised by the
Trustee until the appointment of a new trustee or successor to such Co-Trustee.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.
Stater Bros. may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
------------ ----
compliance with the conditions set forth below in this Article 8.
---------
Section 8.02. Legal Defeasance and Discharge.
Upon Stater Bros.' exercise under Section 8.01 hereof of the option
------------
applicable to this Section 8.02, Stater Bros. shall, subject to the satisfaction
------------
of the conditions set forth in Section 8.04 hereof, be deemed to have been
------------
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that Stater Bros. shall
be deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
------------
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of Stater Bros., shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders
of outstanding Notes to receive solely from the trust fund described in Section
-------
8.04 hereof, and as more fully set forth in such Section, payments in respect of
----
the principal of, premium, if any, and interest and Liquidated Damages, if any,
on such Notes when such payments are due, (b) Stater Bros.' obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
--------- ------------
powers, trusts, duties and immunities of the Trustee hereunder and Stater Bros.'
obligations in connection therewith and (d) this Article 8. Subject to
---------
compliance with this Article 8, Stater Bros. may exercise its option under this
---------
Section 8.02 notwithstanding the prior exercise of its option under Section 8.03
------------ ------------
hereof.
Section 8.03. Covenant Defeasance.
Upon Stater Bros.' exercise under Section 8.01 hereof of the option
------------
applicable to this Section 8.03, Stater Bros. shall, subject to the satisfaction
------------
of the conditions set forth in Section 8.04 hereof, be released from its
------------
obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10,
--------------------------------
4.11, 4.12, 4.13, 4.14, 4.16, 4.17 and 4.18 hereof and clauses (c)
---------------------------------- ----
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and (d) of Section 5.01 hereof with respect to the outstanding Notes on and
------------
after the date the conditions set forth in Section 8.04 are satisfied
------------
(hereinafter, "Covenant Defeasance"), and the Notes shall thereafter be deemed
not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, Stater Bros. may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01 hereof, but, except as specified
------------
above, the remainder of this Indenture and such Notes shall be unaffected
thereby. In addition, upon Stater Bros.' exercise under Section 8.01 hereof of
------------
the option applicable to this Section 8.03 hereof, hereof to the satisfaction of
------------
the conditions set forth in Section 8.04 hereof, Sections 5.01(c) and 5.01(d)
------------ ---------------- -------
and Sections 6.01(iii) through 6.01(vi) hereof shall not constitute Events of
------------------ --------
Default.
Section 8.04. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either Section
-------
8.02 or 8.03 hereof to the outstanding Notes: In order to exercise either Legal
---- ----
Defeasance or Covenant Defeasance: (a) Stater Bros. must irrevocably deposit
with the Trustee, in trust, for the benefit of the Holders, cash in United
States dollars, non-callable Government Securities, or a combination thereof, in
such amounts as will be sufficient, in the opinion of a nationally recognized
firm of independent public accountants, to pay the principal of, premium, if
any, and interest and Liquidated Damages, if any on the outstanding Notes on the
stated maturity or on the applicable redemption date, as the case may be and
Stater Bros. must specify whether the Notes are being defeased to maturity or to
a particular redemption date; (b) in the case of an election under Section 8.02
------------
hereof, Stater Bros. shall have delivered to the Trustee an Opinion of Counsel
in the United States reasonably acceptable to the Trustee confirming that (A)
Stater Bros. has received from, or there has been published by, the Internal
Revenue Service a ruling or (B) since the date of this Indenture, there has been
a change in the applicable federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall confirm that, the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred; (c) in
the case of an election under Section 8.03 hereof, Stater Bros. shall have
------------
delivered to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that the Holders of the outstanding Notes
will not recognize income, gain or loss for federal income tax purposes as a
result of such Covenant Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such Covenant Defeasance had not occurred; (d) no Default or Event
of Default shall have occurred and be continuing on the date of such deposit
(other than a Default or Event of Default resulting from the incurrence of
Indebtedness all or a portion of the proceeds of
68
which will be used to defease the Notes pursuant to this Article 8 concurrently
---------
with such incurrence) or insofar as Sections 6.01(vii) or 6.01(viii) hereof is
------------------ ----------
concerned, at any time in the period ending on the 91st day after the date of
deposit; (e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under any material agreement or
instrument (other than this Indenture) to which Stater Bros. or any of its
Subsidiaries is a party or by which Stater Bros. or any of its Subsidiaries is
bound; (f) Stater Bros. shall have delivered to the Trustee an Opinion of
Counsel (which may be subject to customary exceptions) to the effect that on the
91st day following the deposit, the trust funds will not be subject to the
effect of any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally; (g) Stater Bros. shall have delivered to
the Trustee an Officers' Certificate stating that the deposit was not made by
Stater Bros. with the intent of preferring the Holders over any other creditors
of Stater Bros. or with the intent of defeating, hindering, delaying or
defrauding any other creditors of Stater Bros. or others; and (h) Stater Bros.
shall have delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for or relating to
the Legal Defeasance or the Covenant Defeasance have been complied with.
Section 8.05. Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
------------
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
------------
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
------------
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including Stater Bros. acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
Stater Bros. shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the principal
------------
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
---------
Trustee shall deliver or pay to Stater Bros. from time to time upon the request
of Stater Bros. any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
------------
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would then be
---------------
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
69
Section 8.06. Repayment to Stater Bros.
Any money deposited with the Trustee or any Paying Agent, or then held
by Stater Bros., in trust for the payment of the principal of, premium, if any,
or interest on any Note and remaining unclaimed for two years after such
principal, and premium, if any, or interest has become due and payable shall be
paid to Stater Bros. on its request or (if then held by Stater Bros.) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as a
secured creditor, look only to Stater Bros. for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of Stater Bros. as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of Stater Bros. cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to Stater Bros.
Section 8.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
------------
8.03 hereof, as the case may be, by reason of any order or judgment of any court
----
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then Stater Bros.' obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
------------ ----
permitted to apply all such money in accordance with Section 8.02 or 8.03
------------ ----
hereof, as the case may be; provided, however, that, if Stater Bros. makes any
payment of principal of, premium, if any, or interest on any Note following the
reinstatement of its obligations, Stater Bros. shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, Stater Bros. and the
------------
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder of a Note: (a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including the
---------
related definitions) in a manner that does not materially adversely affect any
Holder; (c) to provide for the assumption of Stater Bros.' obligations to the
Holders of the Notes by a successor to Stater Bros. pursuant to Article 5 or
---------
Article 11 hereof; (d) to make any change that would provide any additional
----------
rights or benefits to the Holders of the Notes or that does not adversely affect
the legal rights hereunder of any Holder of the Note; (e) to comply with
requirements of the Commission in order to effect or maintain the qualification
of this Indenture
70
under the TIA; or (f) to provide for the issuance of Additional Notes in
accordance with the limitations set forth in this Indenture as of the date
hereof.
Upon the request of Stater Bros. accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
-------
7.02 hereof, the Trustee shall join with Stater Bros. in the execution of any
----
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, Stater Bros. and the
------------
Trustee may amend or supplement this Indenture (including Sections 3.09, 4.10
------------- ----
and 4.14 hereof), and the Notes with the consent of the Holders of at least a
----
majority in principal amount of the Notes (including Additional Notes, if any)
then outstanding voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
------------- ----
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture, or the Notes may be waived with the
consent of the Holders of a majority in principal amount of the then outstanding
Notes (including Additional Notes, if any) voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for, or
purchase of, the Notes). Without the consent of at least 75% in principal
amount of the Notes then outstanding (including consents obtained in connection
with a tender offer or exchange offer for, or purchase of, such Notes), no
waiver or amendment to this Indenture may make any change in the provisions of
Article 10 hereof that adversely affects the rights of any Holder of Notes.
----------
Section 2.08 hereof shall determine which Notes are considered to be
------------
"outstanding" for purposes of this Section 9.02.
------------
Upon the request of Stater Bros. accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
------------
join with Stater Bros. in the execution of such amended or supplemental
Indenture unless such amended or supplemental Indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed amendment
------------
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
71
After an amendment, supplement or waiver under this Section becomes
effective, Stater Bros. shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
Stater Bros. to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
------------- ----
majority in aggregate principal amount of the Notes (including Additional Notes,
if any) then outstanding voting as a single class may waive compliance in a
particular instance by Stater Bros. with any provision of this Indenture or the
Notes. However, without the consent of each Holder affected, an amendment or
waiver under this Section 9.02 may not (with respect to any Notes held by a non-
------------
consenting Holder): (a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver; (b) reduce the principal of or
change the fixed maturity of any Note or alter or waive any of the provisions
with respect to the redemption of the Notes, other than provisions relating to
Section 3.09, 4.10 or 4.14 hereof; (c) reduce the rate of or change the time for
------------ ---- ----
payment of interest, including default interest, on any Note; (d) waive a
Default or Event of Default in the payment of principal of or premium, if any,
or interest on the Notes (except a rescission of acceleration of the Notes by
the Holders of at least a majority in aggregate principal amount of the then
outstanding Notes (including Additional Notes, if any) and a waiver of the
payment default that resulted from such acceleration); (e) make any Note payable
in money other than that stated in the Notes; (f) make any change in the
provisions of this Indenture relating to waivers of past Defaults or the rights
of Holders of Notes to receive payments of principal of or premium, if any, or
interest on the Notes; (g) waive a redemption payment with respect to any Note,
other than a payment required by Section 3.09, 4.10 or 4.14 hereof; or (h) make
------------ ---- ----
any change in Section 6.04 or 6.07 hereof or in the preceding amendment and
------------ ----
waiver provisions.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Xxxxxx's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. Stater Bros. in
exchange for all Notes may issue
72
and the Trustee shall, upon receipt of an Authentication Order, authenticate new
Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
---------
adversely affect the rights, duties, liabilities or immunities of the Trustee.
Stater Bros. may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
------------
shall be fully protected in relying upon, in addition to the documents required
by Section 10.04 hereof, an Officer's Certificate and an Opinion of Counsel
-------------
stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture.
ARTICLE 10.
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by XXX (S) 318(c), the imposed duties shall control.
Section 10.02. Notices.
Any notice or communication by Stater Bros. or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address
73
If to Stater Bros.:
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx
Chief Financial Officer
with copies to:
Xxxxxx, Saleson & Xxxxxx LLP
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
and
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
If to the Trustee:
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration
With a copy to:
Xxxxxxx & XxXxxxxx
000 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
Stater Bros. or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back,
74
if telexed; when receipt acknowledged, if telecopied; and the next Business Day
after timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA (S) 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If Stater Bros. mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 10.03. Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA (S) 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. Stater Bros.,
the Trustee, the Registrar and anyone else shall have the protection of TIA (S)
312(c).
Section 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by Stater Bros. to the Trustee to take
any action under this Indenture, Stater Bros. shall furnish to the Trustee: (a)
an Officers' Certificate in form and substance reasonably satisfactory to the
Trustee (which shall include the statements set forth in Section 10.05 hereof)
-------------
stating that, in the opinion of the signers, all conditions precedent and
covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and (b) an Opinion of Counsel in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Section 10.05 hereof) stating that, in the opinion of such counsel, all
-------------
such conditions precedent and covenants have been satisfied.
Section 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA (S) 314(a)(4)) shall comply with the provisions of TIA
(S) 314(e) and shall include: (a) a statement that the Person making such
certificate or opinion has read such covenant or condition; (b) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
satisfied; and (d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
75
Section 10.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.07. No Personal Liability of Directors, Officers, Employees and
Stockholders.
No past, present or future director, officer, employee, incorporator
or stockholder of Stater Bros., as such, shall have any liability for any
obligations of Stater Bros. under the Notes, this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Section 10.08. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of Stater Bros. or its Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10. Successors.
All agreements of Stater Bros. in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
Section 10.11. Severability.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 10.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
76
Section 10.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
77
IN WITNESS WHEREOF, we have set our hands on this Indenture as of the
6th day of August, 1999.
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
IBJ WHITEHALL BANK & TRUST COMPANY
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Assistant Vice President
EXHIBIT A-1
(Face of Note)
===============================================================================
CUSIP _________
ISIN __________
10 3/4% Senior Notes due 2006
No. ___ $___________
Stater Bros. Holdings Inc.
promises to pay to ___________, or registered assigns, the principal sum of
_______________________ _____________Dollars ($__________) on August 15, 2006.
Interest Payment Dates: February 15 and August 15, commencing February 15,
2000.
Record Dates: February 1 and August 1.
Dated: __________
Stater Bros. Holdings Inc.
By:
--------------------------------
Xxxx X. Xxxxx
Chairman of the Board, President
and Chief Executive Officer
By:
--------------------------------
Xxxxx X. Xxxxxx
Secretary
This is one of the
Notes referred to in the
within-mentioned Indenture:
IBJ Whitehall Bank & Trust Company
By:
------------------------------
Authorized Signatory
Dated: __________, ____
===============================================================================
A-1-1
(Back of Note)
10 3/4% [Series A] [Series B] Senior Notes due 2006
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. Interest. Stater Bros. Holdings Inc., a Delaware corporation
("Stater Bros."), promises to pay interest on the principal amount of this Note
at 10 3/4% per annum from August 6, 1999 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 4 of the Registration Rights
Agreement referred to below. Stater Bros. shall pay interest and Liquidated
Damages semi-annually on February 15 and August 15 of each year, or if any such
day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be February 15, 2000. Stater Bros. shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate that is 1% per annum in excess of the rate then in effect; it
shall pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated Damages, if
any, (without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
2. Method of Payment. Stater Bros. will pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the Persons who
are registered Holders of Notes at the close of business on the February 1 or
August 1 next preceding the Interest Payment Date, even if such Notes are
canceled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. If a Holder has given wire transfer instructions to Stater Bros.,
Stater Bros. will pay all principal, interest and premium and Liquidated
Damages, if any, on that Holder's Notes in accordance with those instructions in
immediately available funds. All other payments on Notes will be made at the
office or agency of the Paying Agent and Registrar within the City and State of
New York unless Stater Bros. elects to make payments of interest and Liquidated
Damages, if any, by check mailed to the Holders at their addresses set forth in
the register of Holders. Such payment shall be in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts.
3. Paying Agent and Registrar. Initially, IBJ Whitehall Bank & Trust
Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. Stater Bros. may change any Paying Agent or Registrar without notice
to any Holder. Stater Bros. or any of its Subsidiaries may act as Paying Agent
or Registrar.
4. Indenture. Stater Bros. issued the Notes under an Indenture,
dated as of August 6, 1999 (the "Indenture"), among Stater Bros. and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of
A-1-2
1939, as amended (15 U.S. Code (S)(S) 77aaa-77bbbb). The Notes are subject to
all such terms and Holders are referred to the Indenture and such Act for a
statement of such terms. To the extent any provision of this Note conflicts with
the express provisions of the Indenture, the provisions of the Indenture shall
govern and be controlling. The Notes are obligations of Stater Bros. limited to
$550 million in aggregate principal amount.
5. Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Notes will not be redeemable at Stater Bros.'s option prior to August 15, 2003.
Thereafter, the Notes will be subject to redemption at any time at the option of
Stater Bros., in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest and Liquidated Damages thereon,
if any, to the applicable redemption date, if redeemed during the twelve-month
period beginning on August 15 of the years indicated below:
Year Percentage
---- ----------
2003........................................... 105.3750%
2004........................................... 102.6875%
2005 and thereafter............................ 100.0000%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, prior to August 15, 2002, Stater Bros. may on any one or more
occasions redeem up to 35% of the aggregate principal amount of Notes originally
issued under the Indenture at a redemption price of 110.750% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages thereon,
if any, to the redemption date, with the net cash proceeds of one or more sales
of Capital Stock of Stater Bros. resulting, for each such sale, in net cash
proceeds to Stater Bros. in excess of $25.0 million; provided that: (i) at
least 65% of the aggregate principal amount of Notes issued under the Indenture
remains outstanding immediately after the occurrence of such redemption
(excluding Notes held by Stater Bros. and its Subsidiaries); and (ii) the
redemption shall occur within 45 days of the date of the closing of any such
sale.
6. Mandatory Redemption. Except as set forth in paragraph 7 below,
Stater Bros. shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
7. Repurchase at Option of Holder.
(a) If a Change of Control occurs, each Holder of Notes will have the
right to require Stater Bros. to make an offer (a "Change of Control Offer") to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder's Notes pursuant to a Change of Control Offer at a purchase price
equal to 101% of the aggregate principal amount thereof plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the date of purchase (the
"Change of Control Payment"). Within 30 days following any Change of Control,
Stater Bros. shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
Notes on the date specified in such notice.
(b) When the aggregate amount of Excess Proceeds exceeds $10.0
million, Stater Bros. will make an Asset Sale Offer to all Holders of Notes and
all holders of other Indebtedness that is
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pari passu with the Notes containing provisions similar to those set forth in
this Indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets to purchase the maximum principal amount of Notes and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds. The
offer price in any Asset Sale Offer will be equal to 100% of the principal
amount plus accrued and unpaid interest and Liquidated Damages, if any, to the
date of purchase, and will be payable in cash. If any Excess Proceeds remain
after consummation of an Asset Sale Offer, Stater Bros. may use such Excess
Proceeds for any purpose not otherwise prohibited by the Indenture. If the
aggregate principal amount of Notes and such other pari passu Indebtedness
tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Holders of Notes that are the subject of an offer
to purchase will receive an Asset Sale Offer from Stater Bros. prior to any
related purchase date and may elect to have such Notes purchased by completing
the form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes.
8. Notice of Redemption. Notice of redemption will be mailed, by
first class mail, at least 30 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a Holder are
to be redeemed. On and after the redemption date interest ceases to accrue on
Notes or portions thereof called for redemption.
9. Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and Stater Bros. may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. Stater Bros. need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, Stater Bros.
need not issue, exchange or register the transfer of any Notes for a period of
15 days before a selection of Notes to be redeemed or during the period between
a record date and the corresponding Interest Payment Date.
10. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
11. Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the then outstanding
Notes (including Additional Notes, if any) voting as a single class, and, except
for any Default or Event of Default in the payment of the principal of, premium
and Liquidated Damages, if any, or interest on, the Notes (including in
connection with an offer to purchase), any existing default or compliance with
any provision of the Indenture or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
(including Additional Notes, if any) voting as a single class. Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes or to
alter the provisions of Article 2 of the Indenture (including the related
definitions) in a manner that does not materially adversely affect any Holder,
to provide for the assumption of Stater Bros.' obligations to Holders of the
Notes in case of a merger, consolidation, or sale of assets, to make any change
that would provide any additional rights or benefits to the Holders of the Notes
or that does not adversely affect the
A-1-4
legal rights under the Indenture of any such Holder, to comply with the
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the Trust Indenture Act, or to provide for the issuance
of Additional Notes in accordance with the limitations set forth in the
Indenture.
12. Defaults and Remedies. Events of Default include: (i) default
for 30 days in the payment when due of interest, on, or Liquidated Damages with
respect to, the Notes; (ii) default in payment when due of the principal of, or
premium, if any, on the Notes; (iii) failure by Stater Bros. or any of its
Restricted Subsidiaries to comply with Section 3.09, 4.10, 4.14 or 5.01 of the
Indenture; (iv) failure by Stater Bros. or any of its Restricted Subsidiaries
for 60 days after notice to comply with any of the other agreements in the
Indenture or the Notes (other than a default set forth in clauses (i), (ii) or
(iii) above); (v) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by Stater Bros. or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by Stater Bros. or any of
its Restricted Subsidiaries) whether such Indebtedness or guarantee now exists,
or is created after the date of the Indenture, if that default: (A) is caused
by a failure to pay principal of, or interest or premium, if any, on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (B) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$5.0 million or more; (vi) failure by Stater Bros. or any of its Restricted
Subsidiaries to pay final judgments to the extent not covered by insurance
underwritten by third parties aggregating in excess of $2.0 million, which
judgments shall not have been paid, discharged or stayed for a period of 60
days; (vii) Stater Bros. or any of its Restricted Subsidiaries pursuant to or
within the meaning of Bankruptcy Law: (A) commences a voluntary case for relief
from its creditors; (B) consents to the entry of an order for relief against it
in an involuntary case for relief from its creditors; (C) consents to the
appointment of a custodian of it or for all or substantially all of its
property; (D) makes a general assignment for the benefit of its creditors; or
(E) admits in writing its inability generally to pay its debts as they become
due; or (viii) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that: (A) is for relief against Stater Bros. or any of its
Restricted Subsidiaries in an involuntary case; (B) appoints a custodian of
Stater Bros. or any of its Restricted Subsidiaries or for all or substantially
all of the property of Stater Bros. or any of its Restricted Subsidiaries; or
(C) orders the liquidation of Stater Bros. or any of its Restricted
Subsidiaries; and the order or decree remains unstayed and in effect for 60
consecutive days. If any Event of Default other than an Event of Default
described in clauses (vii) or (viii) above occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the then outstanding Notes
may declare the principal of and accrued interest and Liquidated Damages, if
any, on all the Notes to be due and payable immediately by notice in writing to
Stater Bros. and the Trustee specifying the respective Event of Default and that
such notice is a "notice of acceleration" (the "Acceleration Notice"), and the
same shall become immediately and automatically due and payable.
Notwithstanding the foregoing, if an Event of Default specified in clauses (vii)
or (viii) above occurs, all outstanding Notes shall become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal of, premium and Liquidated Damages, if any, or interest on any Note)
if and so long as a committee of its Responsible Officers in good faith
determines that withholding notice is in the interests of the Holders of the
Notes. The Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive any existing Default or Event of Default and its
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consequences under the Indenture except a continuing Default or Event of Default
in the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes. Stater Bros. is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and Stater Bros.
is required upon becoming aware of any Default or Event of Default, to deliver
to the Trustee a statement specifying such Default or Event of Default.
13. Trustee Dealings with STATER BROS. The Trustee in its individual
or any other capacity may become the owner or Pledgee of Notes and may otherwise
deal with Stater Bros. or any Affiliate of Stater Bros. with the same rights it
would have if it were not Trustee.
14. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator or stockholder of Stater Bros., as such, shall
have any liability for any obligations of Stater Bros. under the Notes, the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
15. Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
16. Abbreviations. Customary abbreviations may be used in the name
of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. Additional Rights of Holders of Restricted Global Notes and
Restricted Definitive Notes. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes (other than Additional Notes) shall have all the rights set
forth in the Registration Rights Agreement, dated as of August 6, 1999, between
Stater Bros. and the parties named on the signature pages thereof or, in the
case of Additional Notes, Holders of Restricted Global Notes and Restricted
Definitive Notes shall have the rights set forth in one or more registration
rights agreements, if any, between Stater Bros. and the other parties thereto,
relating to rights given by Stater Bros. to the purchasers of any Additional
Notes (collectively, the "Registration Rights Agreement").
18. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, Stater Bros. has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
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Stater Bros. will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
P.O. Box 150
Colton, California 92324
Telephone No.: (000) 000-0000
Attention: Corporate Secretary
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Assignment Form
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to:
_______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint________________________________________________________
to transfer this Note on the books of Stater Bros.. The agent may substitute
another to act for him.
________________________________________________________________________________
Date:__________________
Your Signature:___________________________________
(Sign exactly as your name appears on the face of
this Note)
Tax Identification No:____________________________
SIGNATURE GUARANTEE:
_________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
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Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by Stater Bros.
pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
[ ]Section 4.10 [ ]Section 4.14
If you want to elect to have only part of the Note purchased by Stater
Bros. pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $________
Date:_________________
Your Signature:__________________________________
(Sign exactly as your name appears on the face of
this Note)
Tax Identification No:___________________________
SIGNATURE GUARANTEE:
_________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Xxxxxx
Xxxxxx of decrease Amount of increase of this Global Signature of
in Principal in Principal Note following authorized officer
Amount of this Amount of this such decrease (or of Trustee or Note
Date of Exchange Global Note Global Note increase) Custodian
----------------- ------------------ ------------------ ----------------- ------------------
A-1-10
EXHIBIT A-2
(Face of Regulation S Temporary Global Note)
================================================================================
CUSIP ________
ISIN ________
10 3/4% Senior Notes due 2006
No. ___ $____________
Stater Bros. Holdings Inc.
promises to pay to _________, or registered assigns, the principal sum of
_______________________ Dollars ($__________) on August 15, 2006.
Interest Payment Dates: February 15 and August 15, commencing February 15,
2000.
Record Dates: February 1 and August 1.
Dated: __________________
Stater Bros. Holdings Inc.
By: _______________________________
Xxxx X. Xxxxx
Chairman of the Board, President
and Chief Executive Officer
By: _______________________________
Xxxxx X. Xxxxxx
Secretary
This is one of the
Notes referred to in the
within-mentioned Indenture:
IBJ Whitehall Bank & Trust Company
as Trustee
By: _______________________________
Authorized Signatory
Dated: August 6, 1999
================================================================================
A-2-1
(Back of Regulation S Temporary Global Note)
10 3/4% [Series A] [Series B] Senior Notes due 2006
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND
THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES,
ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER
NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE
ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER
OF THE SECURITY EVIDENCED XXXXXX AGREES FOR THE BENEFIT OF THE ISSUER THAT
(A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY
(i)(a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT,
(c) OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (d) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) OF THE SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED
INVESTOR")) THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH
CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $100,000, AN OPINION OF
COUNSEL ACCEPTABLE TO STATER BROS. THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT, OR (e) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL IF THE ISSUER SO REQUESTS),
(ii) TO THE ISSUER, OR
(iii) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
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(B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF
THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(A) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE, AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF STATER BROS.
This Global Note is held by the Depositary (as defined in the
Indenture governing this Note) or its nominee in custody for the benefit of the
beneficial owners hereof, and is not transferable to any person under any
circumstances except that (i) the Trustee may make such notations hereon as may
be required pursuant to Section 2.07 of the Indenture, (ii) this Global Note may
be exchanged in whole but not in part pursuant to Section 2.06(a) of the
Indenture, (iii) this Global Note may be delivered to the Trustee for
cancellation pursuant to Section 2.11 of the Indenture, and (iv) this Global
Note may be transferred to a successor depositary with the prior written consent
of Stater Bros.
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Stater Bros. Holdings Inc., a Delaware corporation
("Stater Bros."), promises to pay interest on the principal amount of this Note
at 10 3/4% per annum from August 6, 1999 until maturity and shall pay the
Liquidated Damages payable pursuant to Section 4 of the Registration Rights
Agreement referred to below. Stater Bros. shall pay interest and Liquidated
Damages semi-annually on February 15 and August 15 of each year, or if any such
day is not a Business Day, on the next succeeding Business Day (each an
"Interest Payment Date"). Interest on the Notes will accrue from the most recent
date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be February 15, 2000. Stater Bros. shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate that is 1% per annum in excess of the rate then in effect; it
shall pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated Damages, if
any, (without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT. Stater Bros. will pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the Persons who
are registered Holders of Notes at
A-2-3
the close of business on the February 1 or August 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. If a Holder has given wire
transfer instructions to Stater Bros., Stater Bros. will pay all principal,
interest and premium and Liquidated Damages, if any, on that Holder's Notes in
accordance with those instructions in immediately available funds. All other
payments on Notes will be made at the office or agency of the Paying Agent and
Registrar within the City and State of New York unless Stater Bros. elects to
make payments of interest and Liquidated Damages, if any, by check mailed to the
Holders at their addresses set forth in the register of Holders. Such payment
shall be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, IBJ Whitehall Bank &
Trust Company, the Trustee under the Indenture, will act as Paying Agent and
Registrar. Stater Bros. may change any Paying Agent or Registrar without notice
to any Holder. Stater Bros. or any of its Subsidiaries may act as Paying Agent
or Registrar.
4. INDENTURE. Stater Bros. issued the Notes under an Indenture,
dated as of August 6, 1999 (the "Indenture"), among Stater Bros. and the
Trustee. The terms of the Notes include those stated in the Indenture and those
made part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code (S)(S) 77aaa-77bbbb). The Notes are subject to all such
terms and Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling. The Notes are obligations of Stater Bros. limited to $550 million
in aggregate principal amount.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Notes will not be redeemable at Stater Bros.'s option prior to August 15, 2003.
Thereafter, the Notes will be subject to redemption at any time at the option of
Stater Bros., in whole or in part, upon not less than 30 nor more than 60 days'
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest and Liquidated Damages thereon,
if any, to the applicable redemption date, if redeemed during the twelve-month
period beginning on August 15 of the years indicated below:
Year Percentage
---- ----------
2003............................................................ 105.3750 %
2004............................................................ 102.6875 %
2005 and thereafter............................................. 100.0000 %
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, prior to August 15, 2002, Stater Bros. may on any one or more
occasions redeem up to 35% of the aggregate principal amount of Notes originally
issued under the Indenture at a redemption price of 110.750% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages thereon,
if any, to the redemption date, with the net cash proceeds of one or more sales
of Capital Stock of Stater Bros. resulting, for each such sale, in net cash
proceeds to Stater Bros. in excess of $25.0 million; provided that: (i) at
least 65% of the aggregate principal amount of Notes issued under the Indenture
remains outstanding immediately after the occurrence of such redemption
(excluding Notes held by Stater Bros.
A-2-4
and its Subsidiaries); and (ii) the redemption shall occur within 45 days of the
date of the closing of any such sale.
6. MANDATORY REDEMPTION. Except as set forth in paragraph 7 below,
Stater Bros. shall not be required to make mandatory redemption or sinking fund
payments with respect to the Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If a Change of Control occurs, each Holder of Notes will have the
right to require Stater Bros. to make an offer (a "Change of Control Offer") to
repurchase all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder's Notes pursuant to a Change of Control Offer at a purchase price
equal to 101% of the aggregate principal amount thereof plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the date of purchase (the
"Change of Control Payment"). Within 30 days following any Change of Control,
Stater Bros. shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
Notes on the date specified in such notice.
(b) When the aggregate amount of Excess Proceeds exceeds $10.0
million, Stater Bros. will make an Asset Sale Offer to all Holders of Notes and
all holders of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem with the proceeds of sales of assets to purchase the
maximum principal amount of Notes and such other pari passu Indebtedness that
may be purchased out of the Excess Proceeds. The offer price in any Asset Sale
Offer will be equal to 100% of the principal amount plus accrued and unpaid
interest and Liquidated Damages, if any, to the date of purchase, and will be
payable in cash. If any Excess Proceeds remain after consummation of an Asset
Sale Offer, Stater Bros. may use such Excess Proceeds for any purpose not
otherwise prohibited by the Indenture. If the aggregate principal amount of
Notes and such other pari passu Indebtedness tendered into such Asset Sale Offer
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and
such other pari passu Indebtedness to be purchased on a pro rata basis. Holders
of Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from Stater Bros. prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed, by
first class mail, at least 30 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in part but
only in whole multiples of $1,000, unless all of the Notes held by a Holder are
to be redeemed. On and after the redemption date interest ceases to accrue on
Notes or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and Stater Bros. may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. Stater Bros. need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, Stater Bros.
need not issue, exchange or register the transfer of any Notes for a period of
15 days before a
A-2-5
selection of Notes to be redeemed or during the period between a record date and
the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the then outstanding
Notes (including Additional Notes, if any) voting as a single class, and, except
for any Default or Event of Default in the payment of the principal of, premium
and Liquidated Damages, if any, or interest on, the Notes (including in
connection with an offer to purchase), any existing default or compliance with
any provision of the Indenture or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
(including Additional Notes, if any) voting as a single class. Without the
consent of any Holder of a Note, the Indenture or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes or to
alter the provisions of Article 2 of the Indenture (including the related
definitions) in a manner that does not materially adversely affect any Holder,
to provide for the assumption of Stater Bros.' obligations to Holders of the
Notes in case of a merger, consolidation, or sale of assets, to make any change
that would provide any additional rights or benefits to the Holders of the Notes
or that does not adversely affect the legal rights under the Indenture of any
such Holder, to comply with the requirements of the Commission in order to
effect or maintain the qualification of the Indenture under the Trust Indenture
Act, or to provide for the issuance of Additional Notes in accordance with the
limitations set forth in the Indenture.
12. DEFAULTS AND REMEDIES. Events of Default include: (i) default
for 30 days in the payment when due of interest, on, or Liquidated Damages with
respect to, the Notes; (ii) default in payment when due of the principal of, or
premium, if any, on the Notes; (iii) failure by Stater Bros. or any of its
Restricted Subsidiaries to comply with Section 3.09, 4.10, 4.14 or 5.01 of the
Indenture; (iv) failure by Stater Bros. or any of its Restricted Subsidiaries
for 60 days after notice to comply with any of the other agreements in the
Indenture or the Notes (other than a default set forth in clauses (i), (ii) or
(iii) above); (v) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by Stater Bros. or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by Stater Bros. or any of
its Restricted Subsidiaries) whether such Indebtedness or guarantee now exists,
or is created after the date of the Indenture, if that default: (A) is caused
by a failure to pay principal of, or interest or premium, if any, on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or (B) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$5.0 million or more; (vi) failure by Stater Bros. or any of its Restricted
Subsidiaries to pay final judgments to the extent not covered by insurance
underwritten by third parties aggregating in excess of $2.0 million, which
judgments shall not have been paid, discharged or stayed for a period of 60
days; (vii) Stater Bros. or any of its Restricted Subsidiaries pursuant to or
within the meaning of Bankruptcy Law: (A) commences a voluntary case for relief
from its creditors; (B) consents to the entry of an order for relief against it
in an involuntary case for relief from its creditors; (C) consents to the
appointment of a custodian of it or for all or substantially all of its
property; (D) makes a general assignment for the benefit of its creditors; or
(E) admits in writing its inability generally to pay its debts as they become
due; or (viii) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that: (A) is for relief against Stater Bros. or any of its
A-2-6
Restricted Subsidiaries in an involuntary case; (B) appoints a custodian of
Stater Bros. or any of its Restricted Subsidiaries or for all or substantially
all of the property of Stater Bros. or any of its Restricted Subsidiaries; or
(C) orders the liquidation of Stater Bros. or any of its Restricted
Subsidiaries; and the order or decree remains unstayed and in effect for 60
consecutive days. If any Event of Default other than an Event of Default
described in clauses (vii) or (viii) above occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the then outstanding Notes
may declare the principal of and accrued interest and Liquidated Damages, if
any, on all the Notes to be due and payable immediately by notice in writing to
Stater Bros. and the Trustee specifying the respective Event of Default and that
such notice is a "notice of acceleration" (the "Acceleration Notice"), and the
same shall become immediately and automatically due and payable.
Notwithstanding the foregoing, if an Event of Default specified in clauses (vii)
or (viii) above occurs, all outstanding Notes shall become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal of, premium and Liquidated Damages, if any, or interest on any Note)
if and so long as a committee of its Responsible Officers in good faith
determines that withholding notice is in the interests of the Holders of the
Notes. The Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes. Stater Bros. is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and Stater Bros.
is required upon becoming aware of any Default or Event of Default, to deliver
to the Trustee a statement specifying such Default or Event of Default.
13. TRUSTEE DEALINGS WITH STATER BROS. The Trustee in its individual
or any other capacity may become the owner or Pledgee of Notes and may otherwise
deal with Stater Bros. or any Affiliate of Stater Bros. with the same rights it
would have if it were not Trustee.
14. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator or stockholder of Stater Bros., as such, shall
have any liability for any obligations of Stater Bros. under the Notes, the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
15. AUTHENTICATION. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name
of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes (other than Additional Notes) shall have all the rights set
forth in the Registration Rights Agreement, dated as of August 6, 1999, between
Stater Bros. and the parties named on the signature pages thereof or, in the
case of Additional
A-2-7
Notes, Holders of Restricted Global Notes and Restricted Definitive Notes shall
have the rights set forth in one or more registration rights agreements, if any,
between Stater Bros. and the other parties thereto, relating to rights given by
Stater Bros. to the purchasers of any Additional Notes (collectively, the
"Registration Rights Agreement").
18. CUSIP NUMBERS. `Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, Stater Bros. has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
A-2-8
Stater Bros. will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
P.O. Box 150
Colton, California 92324
Telephone No.: (000) 000-0000
Attention: Corporate Secretary
A-2-9
Assignment Form
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to:
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
to transfer this Note on the books of Stater Bros.. The agent may substitute
another to act for him.
________________________________________________________________________________
Date: ____________________
Your Signature:___________________________________
(Sign exactly as your name appears on the face of
this Note)
Tax Identification No:____________________________
SIGNATURE GUARANTEE:
_________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
A-2-10
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by Stater Bros.
pursuant to Section 4.10 or 4.14 of the Indenture, check the appropriate box
below:
[ ]Section 4.10 [ ]Section 4.14
If you want to elect to have only part of the Note purchased by Stater
Bros. pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $___________
_______________________________________________________________________________
Date:________________
Your Signature:__________________________________
(Sign exactly as your name appears on the face of
this Note)
Tax Identification No:___________________________
SIGNATURE GUARANTEE:
_________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Registrar, which requirements include
membership or participation in the Security
Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be
determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.
A-2-11
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or of other Restricted
Global Notes for an interest in this Regulation S Temporary Global Note, have
been made:
Principal Xxxxxx
Xxxxxx of Amount of increase of this Global Note Signature of
decrease in in Principal following such authorized officer
Principal Amount Amount of this decrease (or of Trustee or Note
Date of Exchange of this Global Note Global Note increase) Custodian
---------------- ------------------- -------------- ------------ ------------------
A-2-12
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
P.O. Box 150
Colton, California 92324
Telephone: (000) 000-0000
Attention: Corporate Secretary
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx
XxxXxxx XX 00000
Telephone No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: 10 3/4% Senior Notes due 2006
------------------------------
Reference is hereby made to the Indenture, dated as of August 6, 1999
(the "Indenture"), among State Bros. Holdings Inc., as issuer ("Stater Bros.")
and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to __________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest in the
----------------------------------------------------------------------
144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
-----------------------------------------------------------
being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial interest in the
----------------------------------------------------------------------
Temporary Regulation S Global Note, the Regulation S Global Note or a Definitive
--------------------------------------------------------------------------------
Note pursuant to
-----------------
B-1
Regulation S. The Transfer is being effected pursuant to and in accordance with
------------
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act, (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Upon consummation of the proposed transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on Transfer enumerated in the Private
Placement Legend printed on the Regulation S Global Note, the Temporary
Regulation S Global Note and/or the Definitive Note and in the Indenture and the
Securities Act.
3. [ ] Check and complete if Transferee will take delivery of a beneficial
-------------------------------------------------------------------
interest in the IAI Global Note or a Definitive Note pursuant to any provision
------------------------------------------------------------------------------
of the Securities Act other than Rule 144A or Regulation S. The Transfer is
----------------------------------------------------------
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to Stater Bros. or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that it has not engaged in any
general solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive Notes
and the requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) if such Transfer is in respect of a principal amount of Notes
at the time of transfer of less than $100,000, an Opinion of Counsel provided by
the Transferor or the Transferee (a copy of which the Transferor has attached to
this
B-2
certification), to the effect that such Transfer is in compliance with the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the IAI Global Note and/or the Definitive Notes and
in the Indenture and the Securities Act.
4. [ ] Check if Transferee will take delivery of a beneficial interest in an
Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Definitive
Note will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(b) [ ] Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of Stater Bros.
_________________________________________
[Insert Name of Transferor]
By:______________________________________
Name:
Title:
B-3
Dated: ,
--------- ------
B-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP 857555 AF 3), or
-----------
(ii) [ ] Regulation S Global Note (CUSIP U85853 AA 8); or
-----------
(iii) [ ] IAI Global Note (CUSIP 857555 AG 1); or
-----------
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP 857555 AF 3), or
-----------
(ii) [ ] Regulation S Global Note (CUSIP U85853 AA 8), or
-----------
(iii) [ ] IAI Global Note (CUSIP 857555 AG 1); or
-----------
(iv) [ ] Unrestricted Global Note (CUSIP 857555 AH 9); or
-----------
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-5
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
P.O. Box 150
Colton, California 92324
Telephone: (000) 000-0000
Attention: Corporate Secretary
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx
XxxXxxx XX 00000
Telephone No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: 10 3/4% Senior Notes due 2006
-----------------------------
(CUSIP ______________)
Reference is hereby made to the Indenture, dated as of August 6, 1999
(the "Indenture"), among Stater Bros. Holdings Inc., as issuer ("Stater Bros."),
and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms used but
not defined herein shall have the meanings given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the Note[s]
or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
-------------------------------------------------------------
Global Note to beneficial interest in an Unrestricted Global Note. In
-----------------------------------------------------------------
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Global Notes and pursuant to and in accordance with the United States Securities
Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
beneficial interest in an Unrestricted Global Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(b) [ ] Check if Exchange is from beneficial interest in a Restricted
-------------------------------------------------------------
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
-------------------------------------------
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
C-1
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] Check if Exchange is from Restricted Definitive Note to
-------------------------------------------------------
beneficial interest in an Unrestricted Global Note. In connection with the
--------------------------------------------------
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive Note to
-------------------------------------------------------
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
----------------------------
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
-------------------------------------------------------------
Global Note to Restricted Definitive Note. In connection with the Exchange of
-----------------------------------------
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) [ ] Check if Exchange is from Restricted Definitive Note to
--------------------------------------------------------
beneficial interest in a Restricted Global Note. In connection with the
-----------------------------------------------
Exchange of the Owner's Restricted Definitive Note for a beneficial interest in
the [CHECK ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with
an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note
C-2
and in the Indenture and the Securities Act.
C-3
This certificate and the statements contained herein are made for your
benefit and the benefit of Stater Bros..
___________________________________
[Insert Name of Owner]
By: _______________________________
Name:
Title:
Dated: __________, ____
C-4
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Stater Bros. Holdings Inc.
00000 Xxxxxx Xxxx
P.O. Box 150
Colton, California 92324
Telephone: (000) 000-0000
Attention: Corporate Secretary
IBJ Whitehall Bank & Trust Company
Xxx Xxxxx Xxxxxx
XxxXxxx XX 00000
Telephone No.: (000) 000-0000
Attention: Corporate Trust Administration
Re: 10 3/4% Senior Notes due 2006
-----------------------------
Reference is hereby made to the Indenture, dated as of August 6, 1999
(the "Indenture"), among Stater Bros. Holdings Inc., as issuer (the "Stater
Bros."), and IBJ Whitehall Bank & Trust Company, as trustee. Capitalized terms
used but not defined herein shall have the meanings given to them in the
Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to Stater Bros., (B) in accordance with Rule 144A under
the Securities Act to a "qualified institutional buyer" (as defined therein),
(C) to an institutional "accredited investor" (as defined below)
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that, prior to such transfer, furnishes (or has furnished on its behalf by a
U.S. broker-dealer) to you and to Stater Bros. a signed letter substantially in
the form of this letter and, if such transfer is in respect of a principal
amount of Notes, at the time of transfer of less than $100,000, an Opinion of
Counsel in form reasonably acceptable to Stater Bros. to the effect that such
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E) in
accordance with another exemption from the registration requirements of the
Securities Act (and based upon an opinion of counsel if Stater Bros. so
requests) or (F) pursuant to an effective registration statement under the
Securities Act, and, in each case, in accordance with any application securities
laws of any state of the United States or any other applicable jurisdiction, and
we further agree to provide to any person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and Stater
Bros. such certifications, legal opinions and other information as you and
Stater Bros. may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the Notes purchased
by us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and Stater Bros. are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
__________________________________________
[Insert Name of Accredited Investor]
By: _______________________________
Name:
Title:
Dated: __________________, ____
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