Document:

exhibit4_19.htm

    EXHIBIT
      4.19

    

    EXECUTION
      VERSION

    

    

    October
      30, 2007

    

    The
      Steak
      N Shake Company

    500
      Century Building

    36
      South
      Pennsylvania Street

    Indianapolis,
      Indiana 46204

    Attention:  Chief
      Financial Officer

    

    

    
      	
               

            	
              Re:

            	
              Amendment
                No. 5 to Amended and Restated Note Purchase and Private Shelf
                Agreement

            

    

    

    Ladies
      and Gentlemen:

    

    Reference
      is made to that certain
      Amended and Restated Note Purchase and Private Shelf Agreement dated as of
      September 20, 2002, as amended by that certain Amendment dated December 18,
      2002, that certain Amendment dated May 21, 2003, that certain Amendment dated
      September 17, 2003 and that certain Amendment dated November 7, 2005 (as so
      amended, the “Note Agreement”) among The Steak N Shake Company,
      an Indiana corporation (the “Company”), Prudential Investment
      Management, Inc., The Prudential Insurance Company of America and each
      Prudential Affiliate which has or may become a party thereto in accordance
      with
      the terms thereof (collectively, “Prudential”), pursuant to
      which the Company issued and sold and Prudential purchased the Company’s senior
      fixed rate notes from time to time.  Capitalized terms used herein and
      not otherwise defined herein shall have the meanings assigned to such terms
      in
      the Note Agreement.

    

    Pursuant
      to the request of the Company
      and in accordance with the provisions of paragraph 11C of the Note Agreement,
      the parties hereto agree as follows:

    

    SECTION
      1.  Amendment.  From
      and after the date this letter becomes effective in accordance with its terms,
      the Note Agreement is amended as follows:

    

    1.1           Paragraph
      6A of the Note Agreement is amended in its entirety to read as
      follows:

    

    “6A. Debt
      Service Coverage
      Ratio.  The Company will not permit the Debt Service Coverage
      Ratio to be less than (i) 1.05 to 1.00 at any time during the period beginning
      September 26, 2007 and ending July 2, 2008 and (ii) 1.25 to  1.00 at
      any other time.”

    

    

    1.2           The
      proviso appearing at the end of paragraph 6C(2) (Debt) of the Note Agreement
      is
      amended in its entirety and the following is hereby substituted
      therefor:

    

    “provided
      that for each period of four
      (4) consecutive fiscal quarters commencing with the period of four (4)
      consecutive fiscal quarters ending on (or nearest to) September 30, 2002, the
      Company shall, at all times maintain a ratio of Consolidated Debt to
      consolidated EBITDA (the “Leverage Ratio”) not exceeding (i)
      3.25 to 1.00 for the four (4) consecutive fiscal quarter periods ending on
      (or
      nearest to) September 30, 2007,  December 31, 2007, March 30, 2008 and
      June 30, 2008 and (ii) 2.75 to 1.00 for each other period of four (4)
      consecutive fiscal quarters; further provided that for purposes of the Leverage
      Ratio, all current and future Capitalized Lease Obligations shall, for so long
      as the underlying leases are in effect, at all times be included in the
      computation of Consolidated Debt of the Company notwithstanding any subsequent
      reclassification of such Capitalized Lease Obligations as operating leases
      under
      generally accepted accounting principles (and with respect to such rental
      obligations that are reclassified as operating leases, the amount of such rental
      obligations included in the computation of Consolidated Debt shall be the amount
      that would otherwise be required to be capitalized in accordance with generally
      accepted accounting principles if such rental obligations were in fact
      Capitalized Lease Obligations (it being understood and agreed that if the
      Company and/or its Subsidiaries has Capitalized Lease Obligations at the time
      of
      calculating the capitalized amount of such operating leases, such calculation
      of
      the capitalized amount of such operating leases shall be performed consistent
      with the methodology used to calculate the capitalized amount of such
      Capitalized Lease Obligations)).  Together with the delivery of
      financial statements required by paragraphs 5A(i) and (ii), for each Capitalized
      Lease Obligation reclassified as an operating lease the Company will deliver
      to
      each Significant Holder an Officer’s Certificate demonstrating the computation
      (including disclosing the discount rate used in each such computation) of the
      capitalized portion of such operating lease required to be included in the
      computation of Consolidated Debt for purposes of the Leverage Ratio pursuant
      to
      the immediately preceding proviso.”

    

    SECTION
      2.  Representations and
      Warranties.  The Company represents and
      warrants that  (a) each representation and warranty set forth in
      paragraph 8 of the Note Agreement is true and correct as of the date of
      execution and delivery of this letter by the Company with the same effect as
      if
      made on such date (except to the extent such representations and warranties
      expressly refer to an earlier date, in which case they were true and correct
      as
      of such earlier date); and (b) after giving effect to the amendments set forth
      in Section 1 hereof, no Event of Default or Default exists or has occurred
      and
      is continuing on the date hereof.

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    SECTION
      3.  Conditions
      Precedent.  This letter shall be deemed
      effective as of September 26, 2007 upon the return to Prudential on or before
      November 9, 2007 of a counterpart hereof duly executed by the Company and the
      undersigned holders of the Notes.  Upon execution hereof by the
      Company, this letter should be returned to:  Prudential Capital Group,
      Two Prudential Plaza, Suite 5600, Chicago, Illinois 60601,
      Attention:  Scott B. Barnett.

    

    SECTION
      4.  Reference to and Effect on Note
      Agreement.  Upon the effectiveness of
      this letter, each reference to the Note Agreement and the Notes in any other
      document, instrument or agreement shall mean and be a reference to the Note
      Agreement and the Notes as modified by this letter.  Except as
      specifically set forth in Section 1 hereof, each of the Note Agreement and
      the
      Notes shall remain in full force and effect and each is hereby ratified and
      confirmed in all respects.  The execution, delivery and effectiveness
      of this letter shall not be construed as a course of dealing or other
      implication that Prudential or any holder of any Note has agreed to or is
      prepared to grant any consents or agree to any amendments to the Note Agreement
      in the future, whether or not under similar circumstances.

    

    SECTION
      5.  Expenses.  The
      Company hereby confirms its obligations under the Note Agreement, whether or
      not
      the transactions hereby contemplated are consummated, to pay, promptly after
      request by Prudential or any holder of any Note, all reasonable out-of-pocket
      costs and expenses, including attorneys’ fees and expenses, incurred by
      Prudential or any holder of any Note in connection with this letter agreement
      or
      the transactions contemplated hereby, in enforcing any rights under this letter,
      or in responding to any subpoena or other legal process or informal
      investigative demand issued in connection with this letter or the transactions
      contemplated hereby.  The obligations of the Company under this
      Section 5 shall survive transfer by any holder of any Note and payment of any
      Note.

     

    SECTION
      6.  Governing Law. 
THIS LETTER SHALL
      BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
      AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF
      ILLINOIS (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE
      THIS
      LETTER TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH, OR THE RIGHTS OF THE
      PARTIES TO BE GOVERNED BY, THE LAWS OF ANY OTHER
      JURISDICTION).

    SECTION
      7.  Counterparts; Section
      Titles.  This letter may be executed in
      any number of counterparts and by different parties hereto in separate
      counterparts, each of which when so executed and delivered shall be deemed
      to be
      an original and all of which taken together shall constitute but one and the
      same instrument.  Delivery of an executed counterpart of a signature
      page to this letter by facsimile or other electronic transmission shall be
      effective as delivery of a manually executed counterpart of this
      letter.  The section titles contained in this letter are and shall be
      without substance, meaning or content of any kind whatsoever and are not a
      part
      of the agreement between the parties hereto.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Very
      truly yours,

    

    PRUDENTIAL
      INVESTMENT MANAGEMENT, INC.

    
 

    By:                 
       /s/ P. Scott von
      Fischer                                                                                          

    Name:                   P.
      Scott von Fischer

    Title:                   
       Vice
      President                                

    

    THE
      PRUDENTIAL INSURANCE COMPANY

         OF
      AMERICA

    

    By:                  
      /s/ P. Scott von
      Fischer                                                                                          

    Name:                   P.
      Scott von Fischer

    Title:   
                      
Vice
      President                                

    

    PRUCO
      LIFE INSURANCE COMPANY

    

    

    By:                  
      /s/ P. Scott von
      Fischer                    

    Vice
      President

    

    UNITED
      OF OMAHA LIFE INSURANCE

    COMPANY

    

    By:           Prudential
      Private Placement Investors,

    L.P.
      (as Investment
      Advisor)

    

    By:           Prudential
      Private Placement Investors, Inc.

    (as
      its
      General Partner)

    

    By:                 
      /s/ P. Scott von
      Fischer                    

    Vice
      President

    

    
 

    

    Agreed
      and Accepted:

    

    THE
      STEAK N SHAKE COMPANY

    

    

    

    By:        /s/ Jeffrey
      A. Blade            
                                                                   

    Name:  
      Jeffrey A. Blade

    Title:    
      Executive Vice President, Chief Financial and Administrative
      Officer

     

    3exhibit4_20.htm

    EXHIBIT
      4.20

    

    EXECUTION
      VERSION

    

    December
      5, 2007

    

    The
      Steak
      N Shake Company

    500
      Century Building

    36
      South
      Pennsylvania Street

    Indianapolis,
      Indiana 46204

    Attention:  Chief
      Financial Officer

    

    

    
      	
               

            	
              Re:

            	
              Amendment
                No. 6 to Amended and Restated Note Purchase and Private Shelf
                Agreement

            

    

    

    Ladies
      and Gentlemen:

    

    Reference
      is made to that certain
      Amended and Restated Note Purchase and Private Shelf Agreement dated as of
      September 20, 2002, as amended by that certain Amendment dated December 18,
      2002, that certain Amendment dated May 21, 2003, that certain Amendment dated
      September 17, 2003, that certain Amendment dated November 7, 2005 and that
      certain Amendment dated October 30, 2007 (as so amended, the “Note
      Agreement”) among The Steak N Shake Company, an Indiana corporation
      (the “Company”), Prudential Investment Management, Inc., The
      Prudential Insurance Company of America and each Prudential Affiliate which
      has
      or may become a party thereto in accordance with the terms thereof
      (collectively, “Prudential”), pursuant to which the Company
      issued and sold and Prudential purchased the Company’s senior fixed rate notes
      from time to time.  Capitalized terms used herein and not otherwise
      defined herein shall have the meanings assigned to such terms in the Note
      Agreement.

    

    Pursuant
      to the request of the Company
      and in accordance with the provisions of paragraph 11C of the Note Agreement,
      the parties hereto agree as follows:

    

    SECTION
      1.  Amendment.  From
      and after the date this letter becomes effective in accordance with its terms,
      the Note Agreement is amended as follows:

    

    1.1           Paragraph
      6A of the Note Agreement is amended in its entirety to read as
      follows:

    

    “6A. Debt
      Service Coverage
      Ratio.  The Company will not permit the Debt Service Coverage
      Ratio to be less than (i) 1.25 to 1.00 at any time during the period beginning
      on (or nearest to) March 31, 2007 and ending on (or nearest to) June 29, 2007,
      (ii) 1.05 to 1.00 at any time during the period beginning on (or nearest to)
      June 30, 2007 and ending on (or nearest to) September 29, 2007, (iii) 0.95
      to
      1.00 for the period beginning on (or nearest to) September 30, 2007 and ending
      on (or nearest to) December 30, 2007, (iv) 0.90 to 1.00 for the period beginning
      December 31, 2007 and ending on (or nearest to) March 30, 2008, (v) 0.95 to
      1.00
      for the period beginning on (or nearest to) March 31, 2008 and ending on (or
      nearest to) June 29, 2008, (vi) 1.05 to 1.00 for the period beginning on (or
      nearest to) June 30, 2008 and ending on (or nearest to) September 29, 2008
      and
      (vii) 1.25 to 1.00 at any other time.”

    

    1.2           The
      proviso appearing at the end of paragraph 6C(2) (Debt) of the Note Agreement
      is
      amended in its entirety and the following is hereby substituted
      therefor:

    

    “provided
      that for each period of four
      (4) consecutive fiscal quarters commencing with the period of four (4)
      consecutive fiscal quarters ending on (or nearest to) September 30, 2002, the
      Company shall, at all times maintain a ratio of Consolidated Debt to
      consolidated EBITDA (the “Leverage Ratio”) not exceeding (i)
      2.75 to 1.00 for the four (4) consecutive fiscal quarter periods ending on
      (or
      nearest to) June 29, 2007, (ii) 3.25 to 1.00 for the four (4) consecutive fiscal
      quarter periods ending on (or nearest to) September 29, 2007, (iii)
      3.75 to 1.00 for the four (4) consecutive fiscal quarter periods ending on
      (or
      nearest to) December 30, 2007, (iv) 4.00 to 1.00 for the four (4) consecutive
      fiscal quarter periods ending on (or nearest to) March 30, 2008, (v) 3.75 to
      1.00 for the four (4) consecutive fiscal quarter periods ending on (or nearest
      to) June 29, 2008, (vi) 3.50 to 1.00 for the four (4) consecutive fiscal quarter
      periods ending on (or nearest to) September 29, 2008 and (vii) 2.75 to 1.00
      for
      each other period of four (4) consecutive fiscal quarters; further provided
      that
      for purposes of the Leverage Ratio, all current and future Capitalized Lease
      Obligations shall, for so long as the underlying leases are in effect, at all
      times be included in the computation of Consolidated Debt of the Company
      notwithstanding any subsequent reclassification of such Capitalized Lease
      Obligations as operating leases under generally accepted accounting principles
      (and with respect to such rental obligations that are reclassified as operating
      leases, the amount of such rental obligations included in the computation of
      Consolidated Debt shall be the amount that would otherwise be required to be
      capitalized in accordance with generally accepted accounting principles if
      such
      rental obligations were in fact Capitalized Lease Obligations (it being
      understood and agreed that if the Company and/or its Subsidiaries has
      Capitalized Lease Obligations at the time of calculating the capitalized amount
      of such operating leases, such calculation of the capitalized amount of such
      operating leases shall be performed consistent with the methodology used to
      calculate the capitalized amount of such Capitalized Lease
      Obligations)).  Together with the delivery of financial statements
      required by paragraphs 5A(i) and (ii), for each Capitalized Lease Obligation
      reclassified as an operating lease the Company will deliver to each Significant
      Holder an Officer’s Certificate demonstrating the computation (including
      disclosing the discount rate used in each such computation) of the capitalized
      portion of such operating lease required to be included in the computation
      of
      Consolidated Debt for purposes of the Leverage Ratio pursuant to the immediately
      preceding proviso.”

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    1.3           The
      following new paragraph 6C(2A) is added to the Note Agreement after paragraph
      6C(2) (Debt) and before paragraph 6C(3) (Consolidated Net Worth):

    

    “6C(2A).  Leverage
      Fee.  In addition to interest accruing on the Notes, the
      Company agrees to pay to the holders of the Notes a fee (the “Leverage
      Fee”) with respect to each fiscal quarter of the Company, beginning
      with the fiscal quarter ending on (or nearest to) December 30, 2007, on the
      last
      day of which the Leverage Ratio for the four most recent fiscal quarters then
      ended is equal to or greater than 3.00 to 1.00.  The Leverage Fee
      payable with respect to each Note shall be a dollar amount equal to (a) the
      product obtained by multiplying (i) .005 times (ii) the Weighted
      Dollar Average (as defined below) of the principal balance of such Note during
      the fiscal quarter to which the Leverage Fee relates and (b) dividing the
      product thus obtained by four.  The Leverage Fee for each applicable
      fiscal quarter shall be payable in arrears on the date upon which the financial
      statements for such fiscal quarter are to be delivered under paragraph 5A(i)
      (or
      paragraph 5A(ii), if the applicable fiscal quarter is the last fiscal quarter
      in
      a fiscal year).  If the Company fails to deliver financial statements
      under paragraphs 5A(i) or 5A(ii) for any fiscal quarter or fiscal year by the
      date such delivery is due, then the Company shall be deemed to owe the Leverage
      Fee for such fiscal quarter and shall make the payment required for such fiscal
      quarter on the date due pursuant to the preceding sentence.  Payment
      of the Leverage Fee shall be made pursuant to the terms of paragraph
      11A.

    

    The
      acceptance of the Leverage Fee by any holder of a Note shall not constitute
      a
      waiver of any Default or Event of Default, including, without limitation, any
      Default or Event of Default under paragraph 6C(2).  The consequences
      for the failure to pay the Leverage Fee when due shall be governed by paragraph
      7A(ii) hereof, treating the Leverage Fee, for such purposes and for the purpose
      of determining the amount payable upon acceleration of the Notes, as
      interest.

    

    As
      used
      in this paragraph 6C(2A), “Weighted Dollar Average” shall mean,
      with respect to any Note, during any fiscal quarter of the Company, a dollar
      amount determined by adding together the daily outstanding principal balance
      of
      such Note during such fiscal quarter and dividing the amount thus obtained
      by
      the total number of days in such fiscal quarter.”

    

    SECTION
      2.  Representations and
      Warranties.  The Company represents and
      warrants that  (a) each representation and warranty set forth in
      paragraph 8 of the Note Agreement is true and correct as of the date of
      execution and delivery of this letter by the Company with the same effect as
      if
      made on such date (except to the extent such representations and warranties
      expressly refer to an earlier date, in which case they were true and correct
      as
      of such earlier date); and (b) after giving effect to the amendments set forth
      in Section 1 hereof, no Event of Default or Default exists or has occurred
      and
      is continuing on the date hereof.

    

    SECTION
      3.  Conditions
      Precedent.  This letter shall be deemed
      effective as of December 5, 2007 upon the return to Prudential on or before
      December 12, 2007 of a counterpart hereof duly executed by the Company and
      the
      undersigned holders of the Notes.  Upon execution hereof by the
      Company, this letter should be returned to:  Prudential Capital Group,
      Two Prudential Plaza, Suite 5600, Chicago, Illinois 60601,
      Attention:  Scott B. Barnett.

    

    SECTION
      4.  Reference to and Effect on Note
      Agreement.  Upon the effectiveness of
      this letter, each reference to the Note Agreement and the Notes in any other
      document, instrument or agreement shall mean and be a reference to the Note
      Agreement and the Notes as modified by this letter.  Except as
      specifically set forth in Section 1 hereof, each of the Note Agreement and
      the
      Notes shall remain in full force and effect and each is hereby ratified and
      confirmed in all respects.  The execution, delivery and effectiveness
      of this letter shall not be construed as a course of dealing or other
      implication that Prudential or any holder of any Note has agreed to or is
      prepared to grant any consents or agree to any amendments to the Note Agreement
      in the future, whether or not under similar circumstances.

    

    SECTION
      5.  Expenses.  The
      Company hereby confirms its obligations under the Note Agreement, whether or
      not
      the transactions hereby contemplated are consummated, to pay, promptly after
      request by Prudential or any holder of any Note, all reasonable out-of-pocket
      costs and expenses, including attorneys’ fees and expenses, incurred by
      Prudential or any holder of any Note in connection with this letter agreement
      or
      the transactions contemplated hereby, in enforcing any rights under this letter,
      or in responding to any subpoena or other legal process or informal
      investigative demand issued in connection with this letter or the transactions
      contemplated hereby.  The obligations of the Company under this
      Section 5 shall survive transfer by any holder of any Note and payment of any
      Note.

     

    SECTION
      6.  Governing Law. 
THIS LETTER SHALL
      BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
      AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF
      ILLINOIS (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE
      THIS
      LETTER TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH, OR THE RIGHTS OF THE
      PARTIES TO BE GOVERNED BY, THE LAWS OF ANY OTHER
      JURISDICTION).

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     SECTION
      7.  Counterparts; Section
      Titles.  This letter may be executed in
      any number of counterparts and by different parties hereto in separate
      counterparts, each of which when so executed and delivered shall be deemed
      to be
      an original and all of which taken together shall constitute but one and the
      same instrument.  Delivery of an executed counterpart of a signature
      page to this letter by facsimile or other electronic transmission shall be
      effective as delivery of a manually executed counterpart of this
      letter.  The section titles contained in this letter are and shall be
      without substance, meaning or content of any kind whatsoever and are not a
      part
      of the agreement between the parties hereto.

    

    

    Very
      truly yours,

    

    PRUDENTIAL
      INVESTMENT MANAGEMENT, INC.

    

    By:                      /s/ David Quackenbush                                                                                                        

    Name:                  
      David Quackenbush

    Title:                     Vice
      President                                

    

    

    THE
      PRUDENTIAL INSURANCE COMPANY

         OF
      AMERICA

    

    By:                       /s/ David Quackenbush                                                                                                       

    Name:                  
      David Quackenbush

    Title:                     Vice
      President                                

    

    

    PRUCO
      LIFE INSURANCE COMPANY

    

    

    By:                    /s/ David Quackenbush                                     
      

    Vice
      President

    

    UNITED
      OF OMAHA LIFE INSURANCE

    COMPANY

    

    By:           Prudential
      Private Placement Investors,

    L.P.
      (as Investment
      Advisor)

    

    By:           Prudential
      Private Placement Investors, Inc.

    (as
      its
      General Partner)

    

    By:                   /s/ David Quackenbush                                   

    Vice
      President

    

    

 

    Agreed
      and Accepted:

    

    THE
      STEAK N SHAKE COMPANY

    

    

    

    By:       /s/ Jeffrey
      A.
      Blade                                                                                                      

    Name:
      Jeffrey A. Blade

    Title:  
      Executive Vice President, Chief Financial and Administrative
      Officer

     

    3

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