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EXHIBIT 10.4
THIS SECURITY, ANY CONVERTIBLE DEBENTURE ISSUED IN EXCHANGE FOR THIS
SECURITY AND ANY COMMON STOCK ISSUED ON CONVERSION THEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS
ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY,
PRIOR TO THE DATE WHICH IS THREE YEARS AFTER (OR SUCH SHORTER PERIOD UNDER RULE
144A UNDER THE SECURITIES ACT OR ANY SUCCESSOR RULE) THE LATER OF THE ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SUIZA FOODS CORPORATION (THE
"COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR
ANY PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION DATE")
ONLY (A) TO THE COMPANY, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED
IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO
NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE
501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND SUIZA CAPITAL TRUST'S (THE
"TRUST") RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO
CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii)
IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN
THE FORM APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUST. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
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Certificate Number Number of Preferred Securities
0001 2,000,000
CUSIP NO. 865076 20 2
Preferred Securities
of
Suiza Capital Trust
5% Trust Convertible Preferred Securities
(liquidation amount $50 per Trust Convertible Preferred Security)
Suiza Capital Trust, a statutory business trust formed under the laws
of the State of Delaware (the "Trust"), hereby certifies that DFA Investment
Company, a Kansas cooperative marketing association (the "Holder"), is the
registered owner of Two Million (2,000,000) preferred securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the 5% Trust Convertible Preferred Securities (liquidation amount
$50 per Trust Convertible Preferred Security) (the "Preferred Securities").
The Preferred Securities are transferable on the books and records of the
Trust, in person or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Preferred Securities represented hereby are issued and shall in all
respects be subject to the provisions of the Amended and Restated Declaration
of Trust of the Trust dated as of February 20, 1998, as the same may be amended
from time to time (the "Declaration"), including the designation of the terms
of the Preferred Securities as set forth in Annex I to the Declaration.
Capitalized terms used herein but not defined shall have the meaning given them
in the Declaration. The Holder is entitled to the benefits of the Preferred
Securities Guarantee to the extent provided therein. The Sponsor will provide
a copy of the Declaration, the Preferred Securities Guarantee and the Indenture
to a Holder without charge upon written request to the Trust at its principal
place of business.
Reference is hereby made to select provisions of the Preferred
Securities set forth on the reverse hereof, which select provisions shall for
all purposes have the same effect as if set forth at this place.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance hereof, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
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Unless the Property Trustee's Certificate of Authentication hereon has
been properly executed, these Preferred Securities shall not be entitled to any
benefit under the Declaration or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Trust has executed this certificate on February
20, 1998.
SUIZA CAPITAL TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Regular Trustee
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PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Declaration.
Dated: February 20, 1998
WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as
Property Trustee
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Authorized Signatory
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[REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be fixed at a
rate per annum of 5% (the "Coupon Rate") of the stated liquidation amount of
$50 per Preferred Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for
more than one quarter will bear interest thereon compounded quarterly at the
rate of 7% per annum (to the extent permitted by applicable law). The term
"Distribution" as used herein includes any such interest including Additional
Interest, Compounded Interest and Extension Period Interest payable unless
otherwise stated, and any premium and/or principal on the Debentures. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds available therefor. The amount of Distributions payable for
any period will be computed for any full quarterly Distribution period on the
basis of a 360-day year of twelve 30-day months, and for any period shorter
than a full quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 30-day month.
Except as otherwise described below, distributions on the Preferred
Securities will be cumulative, will accrue from the date of original issuance
and will be payable quarterly in arrears, on February 15, May 15, August 15 and
November 15 of each year, commencing on May 15, 1998, to Holders of record
fifteen (15) days prior to such payment dates, which payment dates shall
correspond to the interest payment dates on the Debentures. The Debenture
Issuer has the right under the Indenture to defer payments of interest by
extending the interest payment period from time to time on the Debentures for
successive periods not exceeding 20 consecutive quarters (each an "Extension
Period") during which Extension Period no interest shall be due and payable on
the Debentures; PROVIDED, that no Extension Period shall extend beyond the date
of maturity of the Debentures. As a consequence of such extension,
Distributions will also be deferred. Despite such extension, quarterly
Distributions will continue to accrue with interest thereon (to the extent
permitted by applicable law) compounded quarterly at the rate of 7% per annum
during any such Extension Period. Prior to the termination of any such
Extension Period, the Debenture Issuer may further extend such Extension
Period; PROVIDED, that such Extension Period together with all such previous
and further extensions thereof may not exceed 20 consecutive quarters.
Payments of accrued Distributions will be payable to Holders as they appear on
the books and records of the Trust on the first record date after the end of
the Extension Period. Upon the termination of any Extension Period and the
payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
The Preferred Securities shall be redeemable as provided in the
Declaration.
The Preferred Securities shall be convertible into shares of Common
Stock of Suiza Foods Corporation, through (i) the exchange of Preferred
Securities for a portion of the Debentures and (ii) the immediate conversion of
such Debentures into Common Stock of Suiza Foods Corporation, in the manner and
according to the terms set forth in the Declaration.
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CONVERSION REQUEST
To: Wilmington Trust Company,
as Property Trustee of
Suiza Capital Trust
The undersigned owner of these Preferred Securities hereby irrevocably
exercises the option to convert these Preferred Securities, or the portion
below designated, into Common Stock of SUIZA FOODS CORPORATION (the "Suiza
Common Stock") in accordance with the terms of the Amended and Restated
Declaration of Trust (the "Declaration"), dated as of February 20, 1998, by
▇▇▇▇▇▇▇ ▇▇▇▇▇, as Regular Trustee, Wilmington Trust Company, as Delaware
Trustee, Wilmington Trust Company, as Property Trustee, Suiza Foods
Corporation, as Sponsor, and by the Holders, from time to time, of undivided
beneficial interests in the Trust issued pursuant to the Declaration. Pursuant
to the aforementioned exercise of the option to convert these Preferred
Securities, the undersigned hereby directs the Conversion Agent (as that term
is defined in the Declaration) to (i) exchange such Preferred Securities for a
portion of the Debentures (as that term is defined in the Declaration) held by
the Trust (at the rate of exchange specified in the terms of the Preferred
Securities set forth as Annex I to the Declaration) and (ii) immediately
convert such Debentures, on behalf of the undersigned, into Suiza Common Stock
(at the conversion rate specified in the terms of the Preferred Securities set
forth as Annex I to the Declaration).
The undersigned does also hereby direct the Conversion Agent that the
shares issuable and deliverable upon conversion, together with any check in
payment for fractional shares, be issued in the name of and delivered to the
undersigned, unless a different name has been indicated in the assignment
below. If shares are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto.
Any holder, upon the exercise of its conversion rights in accordance
with the terms of the Declaration and the Preferred Securities, agrees to be
bound by the terms of the Registration Rights Agreement relating to the Suiza
Common Stock issuable upon conversion of the Preferred Securities.
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Date: ,
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in whole in part
---- ----
Number of Preferred Securities to be
converted:
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If a name or names other than the
undersigned, please indicate in the
spaces below the name or names in
which the shares of Suiza Common
Stock are to be issued, along with
the address or addresses of such
person or persons:
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Signature (for conversion only)
Please Print or Typewrite Name and
Address, Including Zip Code, and
Social Security or Other Identifying
Number:
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Signature Guarantee:*
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* Signature Guarantee: (Signature must be guaranteed by an "eligible guarantor
institution" that is, a bank, stockbroker, savings and loan association or
credit union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
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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ASSIGNMENT FORM
To assign this Preferred Security, fill in the form below:
(I) or (we) assign and transfer this Preferred Security to
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(Insert assignee's social security or tax I.D. no.)
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(Print or type assignee's name, address and zip code)
and irrevocably appoint
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agent to transfer this Preferred Security on the books of the Company. The agent
may substitute another to act for him.
Your Signature:
-------------------------
(Sign exactly as your name appears on
the other side of this Security)
Date:
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Signature Guarantee:*
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[Include the following if the Preferred Security bears a Restricted Securities
Legend --
In connection with any transfer of any of the Preferred Securities evidenced by
this certificate, the undersigned confirms that such Preferred Securities are
being:
CHECK ONE BOX BELOW
(1) [ ] exchanged for the undersigned's own account without transfer;
or
(2) [ ] transferred pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
(3) [ ] transferred pursuant to and in compliance with Regulation S
under the Securities Act of 1933; or
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* Signature must be guaranteed by a commercial bank, trust company or member
firm of the NYSE.
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(4) [ ] transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933; or
(5) [ ] transferred pursuant to an effective Shelf Registration
Statement.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Preferred Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED, HOWEVER, that if box
(3) or (4) is checked, the Trustee may require, prior to registering any such
transfer of the Preferred Securities such legal opinions, certifications and
other information as the Company has reasonably requested to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act of 1933, such
as the exemption provided by Rule 144 under such Act.
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Signature
Signature Guarantee*: ]
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Signature
[TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Preferred Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated:
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NOTICE: To be executed by an
executive officer.]
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* Signature must be guaranteed by a commercial bank, trust company or member
firm of the NYSE.
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