Exhibit 10.50
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PAYMENTS ON THIS NOTE CANNOT BE MADE UNLESS PERMITTED BY SECTION 500 OF THE
CALIFORNIA CORPORATIONS CODE AND OTHER APPLICABLE LAWS AND CREDIT AGREEMENTS TO
WHICH THE MAKER IS A PARTY. AS OF THE DATE OF ISSUANCE OF THIS NOTE, THE MAKER
IS NOT IN COMPLIANCE WITH SECTION 500 OF THE CALIFORNIA CORPORATIONS CODE.
SUBORDINATED REDEMPTION NOTE
EXCESS CLASS B SHARES
$__________ Commerce, California ________, 2001
Unified Western Grocers, Inc., a California corporation ("Maker"),
promises to pay to ____________________ ("Payee"), at the principal place of
business of the Payee as reflected on the records of the Maker, the principal
sum of $___________ in lawful money of the United States together with interest
at a rate of 6% per annum on the unpaid balance (all unpaid principal and
interest constituting the "Outstanding Obligation"), principal and interest
payable in 19 equal quarterly installments of $_____________, and the 20th
installment representing the remaining balance of unpaid principal and interest.
The payments hereunder shall be due and payable quarterly on the fifteenth day
of January, April, July and October of each year until the whole sum of
principal and interest has been paid in full. The first payment will be on the
regular payment date first following execution of this Note. This Note is given
pursuant to Article I, Section 11(b)(iii) of the Bylaws of the Maker and is
subject to restraints imposed by law and the Bylaws of the Maker. All sums paid
on this Note shall first be applied to interest, as accrued on the unpaid
principal at the time of such payment, and thereafter to principal. Interest
shall be calculated on the basis of a year of 365 days and charged for the
actual number of days elapsed.
By accepting this Note Xxxxx agrees to the following:
1. Subordination of Outstanding Obligation. In consideration of financial
accommodation given, to be given or continued to be given to the Payee by Maker,
and in consideration of Maker's servicing of the Payee's account, and in
consideration of the providing of financing to Maker by the holders of Senior
Indebtedness as hereinafter defined, and in order to induce such financing, the
Outstanding Obligation shall be subordinate and subject in right of payment, to
the extent and in the manner hereinafter set forth, to the prior payment in full
of all Senior Indebtedness. "Senior Indebtedness" means all indebtedness,
liabilities or obligations of Maker, contingent or otherwise, whether existing
on the date of execution of this Subordination Agreement or thereafter incurred,
(A) in respect of borrowed money; (B) evidenced by bonds, notes, debentures or
other instruments of indebtedness; (C) evidenced by letters of credit, bankers'
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acceptances or similar credit instruments; (D) in respect of Capitalized Lease
Obligations; (E) in respect of the deferred purchase price of property or assets
(whether real, personal, tangible or intangible) or in respect of any mortgage,
security agreement, title retention agreement or conditional sale contract; (F)
in respect of any interest rate swap agreement, interest rate collar agreement
or other similar agreement or arrangement designed to provide interests rate
protection; (G) in respect of all indebtedness, liabilities or obligations of
others of any of the types referred to in clauses (A) through (F) for which
Maker is responsible or liable as obligor, guarantor or otherwise or in respect
of which recourse may be had against any of the property or assets (whether
real, personal, tangible or intangible) of Maker; and (H) in respect of all
modifications, renewals, extensions, replacements and refundings of any
indebtedness, liabilities or obligations of any of the types described in
clauses (A) through (G); provided, however, that the term "Senior Indebtedness"
shall not mean any indebtedness, liabilities or obligations of Maker, contingent
or otherwise, whether existing on the date of execution of this Subordination
Agreement or thereafter incurred, (i) to trade creditors arising or incurred in
the ordinary course of Maker's business (ii) in respect of any redemption,
repurchase or other payments on capital stock, (iii) in respect of Patrons'
Deposits, or (iv) in respect of Patronage Dividend Certificates.
For purposes of the foregoing definition, "Capitalized Lease
Obligations" means the discounted present value of the rental obligations of any
person or entity under any lease of any property which, in accordance with
generally accepted accounting principles, has been recorded on the balance sheet
of such person or entity as a capitalized lease; "Patrons' Deposits" means the
deposits from time to time required to be made or maintained with Maker by its
patrons or customers in accordance with the Bylaws of Maker in effect from time
to time or in accordance with the policies for the servicing of accounts of
patrons or customers established from time to time by Maker, and any deposits
from time to time made or maintained with Maker by its patrons or customers in
excess of such required deposits; and "Patronage Dividend Certificates" means
any notes, revolving fund certificates, retain certificates, certificates of
indebtedness, patronage dividend certificates or any other written evidences of
indebtedness of Maker at any time outstanding which evidence the indebtedness of
Maker respecting the distribution by Maker of patronage dividends.
The Outstanding Obligation shall be subordinate and junior in right of
payment to all Senior Indebtedness in the following respects:
A. In the event of any insolvency or bankruptcy proceedings, and any
receivership, liquidation, reorganization, arrangement or other similar
proceedings in connection therewith, relative to Maker or to its creditors,
as such, or to its property or assets (whether real, personal, tangible or
intangible), or in the event of any proceedings for voluntary liquidation,
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dissolution or other winding up of Maker, whether or not involving
insolvency or bankruptcy, then the holders of Senior Indebtedness shall be
entitled to receive payment in full of all Senior Indebtedness (whether
accrued prior or subsequent to the commencement of such case or proceedings)
before the Payee is entitled to receive any payment with respect to the
Outstanding Obligation, and to that end (but subject to the power of a court
of competent jurisdiction to make other equitable provision reflecting the
rights conferred herein upon the Senior Indebtedness and the holders thereof
with respect to the Outstanding Obligation and the Payee by a lawful plan of
reorganization under applicable bankruptcy law) the holders of Senior
Indebtedness shall be entitled to receive for application in payment thereof
any payment or distribution of any kind or character, whether in cash or
property or securities, or by set off or otherwise, which may be payable or
deliverable in any such proceedings in respect of the Outstanding Obligation
(other than securities which are subordinate and junior in right of payment,
at least to the extent provided herein with respect to the Outstanding
Obligation, to the payment of all Senior Indebtedness then outstanding) and
the holders of Senior Indebtedness may demand, sue for, collect and receive
any such payment or distribution and the receipt therefor, and file all such
claims and take all such action, in the name of the Payee or otherwise, as
such holders of Senior Indebtedness may determine to be necessary or
appropriate for the enforcement of these subordination provisions, and the
Payee will also execute and deliver such instruments confirming such
authorizations and such powers of attorney, proofs of claim, assignments of
claim, and other instruments as may be requested by such holders of Senior
Indebtedness in order to enable such holders to enforce any and all claims
upon or in respect of that portion of any Outstanding Obligation; and upon
any such insolvency or bankruptcy proceedings, receivership, liquidation,
reorganization, arrangement or other similar proceedings, or voluntary
liquidation, dissolution or other winding up, any payment or distribution of
assets of Maker of any kind or character, whether in cash, property or
securities or by set off or otherwise (other than securities which are
subordinate and junior in right of payment, at least to the extent provided
herein with respect to the Outstanding Obligation, to the payment of all
Senior Indebtedness then outstanding) to which the Payee would be entitled,
except for the provisions hereof, shall be paid by Maker or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making
such payment or distribution directly to the holders of Senior Indebtedness
(pro rata to each such holder on the basis of the respective amounts of
Senior Indebtedness held by such holder) or their representatives, to the
extent necessary to pay all Senior Indebtedness in full, after giving effect
to any concurrent payment or distribution to or for the holders of Senior
Indebtedness;
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B. In the event that any default shall occur and be continuing with
respect to the payment of Senior Indebtedness, unless payment in full shall
have first been made on all Senior Indebtedness or such default with respect
to such Senior Indebtedness shall have been cured or waived in accordance
with the terms of such Senior Indebtedness, no payment shall be made with
respect to the Outstanding Obligation (including any such payment which
would cause such default); and
C. In the event that any default (other than those referred to in
paragraph B above) shall occur and be continuing with respect to any Senior
Indebtedness permitting the holders of such Senior Indebtedness to
accelerate the maturity thereof, unless payment in full shall have first
been made on all Senior Indebtedness or such default with respect to such
Senior Indebtedness shall have been cured or waived in accordance with the
terms of such Senior Indebtedness, all payments with respect to the
Outstanding Obligation (including any such payment which would cause such
default) shall be suspended during any period:
(1) of 180 days after the giving of written notice of such default
by the holders of Senior Indebtedness to Maker; provided, that only one
such notice shall be given pursuant to this clause (1) in any 12
consecutive months; or
(2) in which judicial proceedings shall be pending in respect of
such default, a notice of acceleration of the maturity of such Senior
Indebtedness shall have been transmitted to Maker in respect of such
default and such judicial proceedings shall be diligently pursued in
good faith.
In the event that any payment or other distribution is made to or
received by the Payee in contravention of the provisions of paragraphs A, B
and/or C above, then such payment or other distribution shall be held by the
Payee for the benefit of, and shall be paid over and delivered to, the holders
of Senior Indebtedness (pro rata as their interests shall appear) or to their
representative or the trustee under the indenture or other agreement (if any)
pursuant to which Senior Indebtedness may have been issued, for application to
the payment of all Senior Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness then due and payable in accordance with its
terms, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Indebtedness.
2. Prepayment. Maker may, without premium or penalty, at any time and from
time to time, prepay all or any portion of the outstanding principal balance due
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under this Note. Any partial prepayments shall be applied to installments in
inverse order of their maturity.
3. Right of Set-Off. Maker shall have the right to withhold and set-off
against any amount due under this Note the amounts of any indebtedness that may
be owing the Maker or any of the Maker's subsidiaries by the Payee. Payee shall
have no right to set-off any amount due under this Note against any amount which
the Payee owes the Maker or any of the Maker's subsidiaries, and the Payee
hereby relinquishes any such right.
4. Severability. If any provision in this Note is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Note will remain in full force and effect. Any provision of this Note held
invalid or unenforceable only in part or degree will remain in full force and
effect to the extent not held invalid or unenforceable.
5. Governing Law. This Note will be governed by the internal laws of the
State of California without regard to conflicts of laws principles.
6. Parties in Interest. This Note shall bind Maker and its successors and
assigns. This Note shall not be assigned or transferred by Payee without the
express prior written consent of Maker, except by will or by the laws of
succession if the Payee is an individual.
7. Section Headings, Construction. The headings of Sections in this Note
are provided for convenience only and will not affect its construction or
interpretation. All words used in this Note will be construed to be of such
gender or number as the circumstances require.
8. Non-Negotiability. This Note is not negotiable and shall not be
construed as an instrument governed by Division 3 of the California Uniform
Commercial Code.
[Signature Page follows]
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IN WITNESS WHEREOF, the Maker has caused this Note to be
executed by its duly authorized officers.
Unified Western Grocers, Inc.,
a California corporation
By__________________________________
Its _______________________________
By__________________________________
Its _______________________________
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