Registration Rights Agreement
Exhibit 4.2
Dated as of September 9, 2005
by and among
and
the Subsidiary Guarantors listed on the Signature pages hereof,
on the one hand,
and
Banc of America Securities LLC
and
the Initial Purchasers,
on the other hand
This REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into on September 9,
2005 (the “Closing Date”), by and among MGM MIRAGE, a Delaware corporation (the “Company”) and the
subsidiary guarantors listed on the signature page of this Agreement (the “Subsidiary Guarantors”),
on the one hand, and Banc of America Securities LLC on its own behalf and as representative of and
each of the other Initial Purchasers named in Schedule A hereto (collectively, the “Initial
Purchasers”), on the other hand.
This Agreement is made pursuant to that certain Purchase Agreement, dated August 25, 2005
among the Company, the Subsidiary Guarantors and the Initial Purchasers (the “Purchase Agreement”),
which provides for the sale by the Company to the Initial Purchasers of an aggregate of
$375,000,000 in principal amount of the Company’s 6.625% Senior Notes due 2015 (the “Notes”), which
are guaranteed by the Subsidiary Guarantors. In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Company and the Subsidiary Guarantors have agreed to provide to
the Initial Purchasers and their direct and indirect transferees the registration rights set forth
in this Agreement. The execution of this Agreement is a condition to the closing under the Purchase
Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
acknowledged, the parties hereto covenant and agree as follows:
1. Definitions.
As used in this Agreement, the following capitalized defined terms shall have the following
meanings:
“1933 Act” shall mean the Securities Act of 1933, as amended from time to time.
“1934 Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.
“Additional Interest” shall have the meaning set forth in Section 2.5 hereof.
“Broker Prospectus Period” shall mean a period of at least 365 days after the consummation of
the Exchange Offer during which the Company shall make a prospectus meeting the requirements of the
1933 Act available to all Participating Broker-Dealers for use in connection with any resale of any
Exchange Notes acquired in the Exchange Offer.
“Closing” shall mean the Closing Time as defined in the Purchase Agreement.
“Company” shall have the meaning set forth in the preamble and shall also include the
Company’s successors.
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“Depositary” shall mean The Depository Trust Company, or any other depositary appointed by the
Company, provided, however, that such depositary must have an address in the
Borough of Manhattan, in the City of New York.
“Exchange Notes” shall mean the 6.625% Senior Notes due 2015 to be issued by the Company and
guaranteed by the Subsidiary Guarantors under the Indenture containing terms identical to the Notes
in all material respects (except for references to certain interest rate provisions, restrictions
on transfers and restrictive legends), to be offered to Holders of Notes in exchange for Transfer
Restricted Notes pursuant to the Exchange Offer.
“Exchange Offer” shall mean the exchange offer by the Company and the Subsidiary Guarantors of
Exchange Notes for Transfer Restricted Notes pursuant to Section 2.1 hereof.
“Exchange Offer Registration” shall mean a registration under the 1933 Act effected pursuant
to Section 2.1 hereof.
“Exchange Offer Registration Statement” shall mean an exchange offer registration statement on
Form S-4 (or, if applicable, on another appropriate form), and all amendments and supplements to
such registration statement, including the Prospectus contained therein, all exhibits thereto and
all documents incorporated by reference therein.
“Exchange Period” shall have the meaning set forth in Section 2.1 hereof.
“Holder” shall mean an Initial Purchaser, for so long as it owns any Transfer Restricted
Notes, and each of its successors, assigns and direct and indirect transferees who become
registered owners of Transfer Restricted Notes under the Indenture and each Participating
Broker-Dealer that holds Exchange Notes for so long as such Participating Broker-Dealer is required
to deliver a prospectus meeting the requirements of the 1933 Act in connection with any resale of
such Exchange Notes.
“Indenture” shall mean the Indenture relating to the Notes, dated as of June 20, 2005, among
the Company, the Subsidiary Guarantors, and U.S. Bank National Association, as trustee, as
supplemented by the Supplemental Indenture and as the same may be amended, supplemented, waived or
otherwise modified from time to time in accordance with the terms thereof.
“Initial Purchaser” or “Initial Purchasers” shall have the meaning set forth in the preamble.
“Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of
outstanding Transfer Restricted Notes; provided that whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Notes is required hereunder, Transfer
Restricted Notes held by the Company and other obligors on the Notes or any Affiliate (as defined
in the Indenture) of the Company or any Subsidiary Guarantor shall be disregarded in determining
whether such consent or approval was given by the Holders of such required percentage amount.
“Notes” shall have the meaning set forth in the preamble hereof.
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“Participating Broker-Dealer” shall mean any of the Initial Purchasers and any other
broker-dealer which makes a market in the Notes and exchanges Transfer Restricted Notes in the
Exchange Offer for Exchange Notes.
“Person” shall mean an individual, partnership (general or limited), corporation, limited
liability company, trust or unincorporated organization, or a government or agency or political
subdivision thereof.
“Private Exchange” shall have the meaning set forth in Section 2.1 hereof.
“Private Exchange Notes” shall have the meaning set forth in Section 2.1 hereof.
“Prospectus” shall mean the prospectus included in a Registration Statement, including any
preliminary prospectus, and any such prospectus as amended or supplemented by any prospectus
supplement, including any such prospectus supplement with respect to the terms of the offering of
any portion of the Transfer Restricted Notes covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post effective amendments, and in each
case including all material incorporated by reference therein.
“Purchase Agreement” shall have the meaning set forth in the preamble.
“Registration Expenses” shall mean any and all expenses incident to performance of or
compliance by the Company and the Subsidiary Guarantors with this Agreement, including without
limitation: (i) all SEC, stock exchange or National Association of Securities Dealers, Inc. (the
“NASD”) registration and filing fees, including, if applicable, the fees and expenses of any
“qualified independent underwriter” that is required to be retained by any holder of Transfer
Restricted Notes in accordance with the rules and regulations of the NASD, (ii) all fees and
expenses incurred in connection with compliance with state securities or blue sky laws and
compliance with the rules of the NASD (including reasonable fees and disbursements of counsel for
any underwriters or Holders in connection with blue sky qualification of any of the Exchange Notes
or Transfer Restricted Notes and any filings with the NASD), (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing any Registration
Statement, any Prospectus, any amendments or supplements thereto, any underwriting agreements,
securities sales agreements and other documents relating to the performance of and compliance with
this Agreement, (iv) all fees and expenses incurred in connection with the listing, if any, of any
of the Transfer Restricted Notes on any securities exchange or exchanges, (v) all rating agency
fees, (vi) the fees and disbursements of counsel for the Company and the Subsidiary Guarantors and
of the independent public accountants of the Company and the Subsidiary Guarantors, including the
expenses of any special audits or “cold comfort” letters required by or incident to such
performance and compliance, (vii) the fees and expenses of the Trustee (including the reasonable
fees and disbursements of its counsel), and any escrow agent or custodian, and (viii) any fees and
disbursements of the underwriters customarily required to be paid by issuers or sellers of
securities and the fees and expenses of any special experts retained by the Company and the
Subsidiary Guarantors in connection with any Registration Statement, but excluding underwriting
discounts and commissions and transfer taxes, if any, relating to the sale or disposition of
Transfer Restricted Notes by a Holder. Notwithstanding the foregoing, except as specifically
provided above, the Company and the
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Subsidiary Guarantors shall not be responsible for the fees and expenses of the Initial
Purchasers in connection with the Exchange Offer, or the fees and expenses of counsel to the
Initial Purchasers in connection therewith.
“Registration Statement” shall mean any registration statement of the Company which covers any
of the Exchange Notes or Transfer Restricted Notes pursuant to the provisions of this Agreement,
and all amendments and supplements to any such Registration Statement, including post-effective
amendments, in each case including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
“SEC” shall mean the Securities and Exchange Commission or any successor agency or government
body performing the functions currently performed by the United States Securities and Exchange
Commission.
“Shelf Registration” shall mean a registration effected pursuant to Section 2.2
hereof.
“Shelf Registration Statement” shall mean a “shelf” registration statement of the Company
pursuant to the provisions of Section 2.2 of this Agreement which covers Transfer
Restricted Notes or Private Exchange Notes on an appropriate form under Rule 415 under the 1933
Act, or any similar rule that may be adopted by the SEC, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by reference therein.
“Supplemental Indenture” shall mean a supplemental indenture relating to the Notes dated as of
September 9, 2005 among the Company, Subsidiary Guarantors, and U.S. Bank National Association, as
trustee.
“TIA” shall have the meaning set forth in Section 2.1 hereof.
“Transfer Restricted Notes” shall mean the Notes and, if issued, the Private Exchange Notes;
provided, however, that the Notes and, if issued, the Private Exchange Notes, shall
cease to be Transfer Restricted Notes when (i) such Transfer Restricted Note has been exchanged by
a person (other than a Participating Broker-Dealer) for an Exchange Note in the Exchange Offer,
(ii) following the exchange by a Participating Broker-Dealer in the Exchange Offer of a Transfer
Restricted Note for an Exchange Note, the date on which such Exchange Note is sold to a purchaser
who received from such Participating Broker-Dealer on or prior to the date of such sale a copy of
the prospectus contained in the Exchange Offer Registration Statement, as amended or supplemented,
(iii) such Transfer Restricted Note has been effectively registered under the 1933 Act and disposed
of in accordance with the Shelf Registration Statement, (iv) such Transfer Restricted Note is
eligible for distribution to the public pursuant to Rule 144(k) (or any similar provision then in
force, but not Rule 144A) under the 1933 Act, or (v) such Transfer Restricted Note ceases to be
outstanding.
“Trustee” shall mean the trustee with respect to the Notes under the Indenture.
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2. Registration Under the 0000 Xxx.
2.1 Exchange Offer. The Company and the Subsidiary Guarantors shall, for the benefit
of the Holders, at the Company’s and Subsidiary Guarantors’ cost, (A) file the Exchange Offer
Registration Statement with the SEC on or prior to the 120th day following the Closing Date, which
Exchange Offer Registration Statement shall be on an appropriate form under the 1933 Act and shall
relate to a proposed Exchange Offer (and only to an Exchange Offer and not to the registration of
the offer or sale of any other securities except with respect to (i) an “Exchange Offer” (as such
term is defined pursuant to Section 2.1 of that certain Registration Rights Agreement (the “Old
Registration Rights Agreement”) dated June 20, 2005 among the Company, Xxxxxx Xxxxxxx & Co.
Incorporated and the Initial Purchasers named therein) and (ii) the corresponding securities) and
the issuance and delivery to the Holders who so elect, in exchange for the Transfer Restricted
Notes (other than Private Exchange Notes), of a like principal amount of Exchange Notes, (B) use
their best efforts to have the Exchange Offer Registration Statement declared effective by the SEC
under the 1933 Act on or prior to the 180th day following the Closing Date, (C) commence the
Exchange Offer promptly after the Exchange Offer Registration Statement is declared effective, (D)
keep the Exchange Offer open for acceptance for not less than 20 business days after notice thereof
is mailed to Holders (or longer if required by applicable law) (such period referred to herein as
the “Exchange Period”) and consummate the Exchange Offer no later than 30 business days following
the date on which the Exchange Offer Registration Statement is declared effective by the SEC, (E)
use their best efforts to issue, promptly after the end of the Exchange Period, Exchange Notes in
exchange for all Notes that have been properly tendered for exchange during the Exchange Period and
(F) use their best efforts to maintain the effectiveness of the Exchange Offer Registration
Statement during the Exchange Period and thereafter until such time as the Company has issued
Exchange Notes in exchange for all Transfer Restricted Notes that have been properly tendered for
exchange during the Exchange Period. The Exchange Notes will be issued under the Indenture and be
of the same class and series, and have the same CUSIP number as the registered notes to be issued
in exchange for the Company’s $500,000,000 million aggregate principal amount 6.625% Senior Notes
due 2015 originally issued under the Indenture on June 20, 2005. Upon the effectiveness of the
Exchange Offer Registration Statement, the Company and the Subsidiary Guarantors shall promptly
commence the Exchange Offer, it being the objective of such Exchange Offer to enable each Holder
eligible and electing to exchange Transfer Restricted Notes for Exchange Notes (assuming that such
Holder makes certain representations and warranties to the Company, including representations that
(a) it is not an affiliate of the Company within the meaning of Rule 405 under the 1933 Act, (b)
any Exchange Notes to be received by it will be acquired in the ordinary course of its business,
(c) if such Holder is not a broker-dealer, that it is not engaged in, and does not intend to engage
in, the distribution of the Exchange Notes, (d) if such Holder is a broker-dealer that will receive
Exchange Notes for its own account in exchange for Transfer Restricted Notes acquired as a result
of market-making or other trading activities, that such broker-dealer will deliver a prospectus in
connection with any resale of such Exchange Notes, and (e) it has no arrangements or understandings
with any Person to participate in the distribution of the Transfer Restricted Notes or
the Exchange
Notes) to transfer such Exchange Notes from and after their receipt without any limitations or
restrictions under the 1933 Act and under state securities or blue sky laws. In connection with
the Exchange Offer, the Company and the Subsidiary Guarantors shall additionally:
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(a) utilize the services of the Depositary for the Exchange Offer;
(b) permit Holders to withdraw tendered Transfer Restricted Notes at any time prior to
5:00 p.m. (Eastern Standard Time), on the last business day of the Exchange Period, by
sending to the institution specified in the notice, a telegram, telex, facsimile
transmission or letter setting forth the name of such Holder, the principal amount of
Transfer Restricted Notes delivered for exchange, and a statement that such Holder is
withdrawing such Holder’s election to have such Notes exchanged;
(c) notify each Holder that any Transfer Restricted Notes not tendered will remain
outstanding and continue to accrue interest, but will not retain any rights under this
Agreement (except in the case of the Initial Purchasers and Participating Broker-Dealers as
provided herein); and
(d) otherwise comply in all respects with all applicable laws relating to the Exchange
Offer.
If, prior to consummation of the Exchange Offer, the Initial Purchasers hold any Notes
acquired by them and having the status of an unsold allotment in the initial distribution, the
Company and the Subsidiary Guarantors upon the request of any Initial Purchaser shall,
simultaneously with the delivery of the Exchange Notes in the Exchange Offer, issue and deliver to
such Initial Purchaser in exchange (the “Private Exchange”) for the Notes held by such Initial
Purchaser, a like principal amount of debt securities of the Company that are identical (except
that such securities shall bear appropriate transfer restrictions) to the Exchange Notes (the
“Private Exchange Notes”) and guaranteed by the Subsidiary Guarantors.
The Exchange Notes and the Private Exchange Notes shall be issued under (i) the Indenture or
(ii) an indenture identical in all material respects to the Indenture and which, in either case,
has been qualified under the Trust Indenture Act of 1939, as amended (the “TIA”), or is exempt from
such qualification and shall provide that the Exchange Notes shall not be subject to the transfer
restrictions set forth in the Indenture but that the Private Exchange Notes shall be subject to
such transfer restrictions. All notes issued under the Indenture shall vote and consent together
on all matters as one class and none of such notes will have the right to vote or consent as a
separate class on any matter. The Private Exchange Notes shall be of the same series as the
Exchange Notes and the Company shall use all commercially reasonable efforts to have the Private
Exchange Notes bear the same CUSIP number as the Exchange Notes. The Company and the Subsidiary
Guarantors shall not have any liability under this Agreement solely as a result of such Private
Exchange Notes not bearing the same CUSIP number as the Exchange Notes.
As soon as practicable after the close of the Exchange Offer and/or the Private Exchange, as
the case may be, the Company and the Subsidiary Guarantors shall:
(i) accept for exchange all Transfer Restricted Notes duly tendered and not validly
withdrawn pursuant to the Exchange Offer in accordance with the terms of the Exchange Offer
Registration Statement and the letter of transmittal which shall be an exhibit thereto;
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(ii) accept for exchange all Notes properly tendered pursuant to the Private Exchange;
(iii) deliver to the Trustee for cancellation all Transfer Restricted Notes so accepted
for exchange; and
(iv) cause the Trustee promptly to authenticate and deliver Exchange Notes or Private
Exchange Notes, as the case may be, to each Holder of Transfer Restricted Notes so accepted
for exchange in a principal amount equal to the principal amount of the Transfer Restricted
Notes of such Holder so accepted for exchange.
Interest on each Exchange Note and Private Exchange Note, including Additional Interest, will
accrue (a) from the later of (i) the last date on which interest was paid on the Transfer
Restricted Notes surrendered in exchange therefor or (ii) if the Transfer Restricted Notes are
surrendered for exchange on a date in a period which includes the record date for an interest
payment date to occur on or after the date of such exchange and as to which interest will be paid,
the date of such interest payment date or (b) if no interest has been paid on the Transfer
Restricted Notes, from June 20, 2005. The Company shall inform the Initial Purchasers of the names
and addresses of the Holders to whom the Exchange Offer is made, and the Initial Purchasers shall
have the right, but not the obligation, to contact such Holders and otherwise facilitate the tender
of Transfer Restricted Notes in the Exchange Offer.
2.2 Shelf Registration. If,
(i) the Company or any Subsidiary Guarantor is not permitted to file the Exchange Offer
Registration Statement or to consummate the Exchange Offer because the Exchange Offer is not
permitted by applicable law or SEC rules and regulations,
(ii) for any other reason the Exchange Offer is not consummated within 222 days after
the Closing Date,
(iii) any Holder notifies the Company within 30 days following the date upon which the
Exchange Offer Registration Statement is declared effective that:
(1) such Holder is not entitled to participate in the Exchange Offer,
(2) such Holder may not resell or otherwise transfer the Exchange Notes
acquired by it in the Exchange Offer to the public without delivering a prospectus
and the prospectus contained in the Exchange Offer Registration Statement is not
appropriate for such resales by such Holder, or
(3) such Holder is a broker-dealer and owns Notes acquired directly from the
Company or an affiliate of the Company, or
(iv) the holders of a majority in aggregate principal amount of the Transfer Restricted
Notes are not eligible to participate in the Exchange Offer and to receive Exchange Notes
that they may resell to the public without volume restrictions under the
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1933 Act and the rules thereunder and without similar restrictions under applicable
blue sky or state securities laws,
then in case of each of clauses (i) through (iv) the Company and the Subsidiary Guarantors shall
promptly deliver to the Holders and the Trustee written notice thereof and shall, at their cost:
(a) file with the SEC as promptly as practicable (and, in any event on or prior to the
60th day after such filing obligation arises) and thereafter shall use their best efforts to
cause to be declared effective no later than 180 days after such filing obligation arises, a
Shelf Registration Statement relating to the offer and sale of the Transfer Restricted Notes
by the Holders from time to time in accordance with the methods of distribution elected by
the Holders of a majority in aggregate principal amount of Transfer Restricted Notes
participating in the Shelf Registration and set forth in such Shelf Registration Statement;
provided, however, that, if the obligation to file the Shelf Registration
Statement arises because the Exchange Offer has not been consummated within 222 days after
the Closing Date, the Company and Subsidiary Guarantors shall use their best efforts to file
the Shelf Registration Statement as promptly as practicable after such date, and in any
event prior to the 251st day following the Closing Date,
(b) use their best efforts to keep the Shelf Registration Statement continuously
effective, supplemented and amended (including through post-effective amendments on Form S-3
if the Company is eligible to use such Form) in order to permit the Prospectus forming part
thereof to be usable by Holders for a period of two years from the date the Shelf
Registration Statement is declared effective by the SEC, or for such shorter period that
will terminate when all Transfer Restricted Notes covered by the Shelf Registration
Statement have been sold pursuant to the Shelf Registration Statement or cease to be
outstanding or otherwise to be Transfer Restricted Notes (the “Effectiveness Period”);
provided, however, that the Effectiveness Period in respect of the Shelf
Registration Statement shall, upon written request to the Company, be extended to the extent
required to permit dealers to comply with the applicable prospectus delivery requirements of
Rule 174 under the 1933 Act and as otherwise provided herein, and
(c) notwithstanding any other provisions hereof, use their best efforts to ensure that
(i) any Shelf Registration Statement and any amendment thereto and any Prospectus forming a
part thereof and any supplement thereto complies in all material respects with the 1933 Act
and the rules and regulations thereunder, (ii) any Shelf Registration Statement and any
amendment thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading and (iii) any Prospectus forming part of any
Shelf Registration Statement, and any supplement to such Prospectus (as amended or
supplemented from time to time), does not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements, in light of the
circumstances under which they were made, not misleading.
The Company and the Subsidiary Guarantors shall not permit any securities other than Transfer
Restricted Notes to be included in the Shelf Registration Statement (except with respect to
“Transfer Restricted Notes” (as such term is defined pursuant to Section 1 of the Old
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Registration Rights Agreement)). The Company and the Subsidiary Guarantors agree, if
necessary, to supplement or amend the Shelf Registration Statement, as required by Section
3(b) below, and to furnish to the Holders of Transfer Restricted Notes copies of any such
supplement or amendment promptly after its being used or filed with the SEC.
2.3 Expenses. The Company and the Subsidiary Guarantors shall pay all Registration
Expenses in connection with the registration pursuant to Section 2.1 or 2.2. Each
Holder shall pay all underwriting discounts and commissions and transfer taxes, if any, relating to
the sale or disposition of such Holder’s Transfer Restricted Notes pursuant to the Shelf
Registration Statement.
2.4 Effectiveness.
(a) The Company and the Subsidiary Guarantors will be deemed not to have used their
best efforts to cause the Exchange Offer Registration Statement or the Shelf Registration
Statement, as the case may be, to become, or to remain, effective during the requisite
period if either the Company or any Subsidiary Guarantor voluntarily takes any action that
would, or omits to take any action which omission would, result in any such Registration
Statement not being declared effective, or in the Holders of Transfer Restricted Notes
covered thereby not being able to exchange or offer and sell such Transfer Restricted Notes
during that period as and to the extent contemplated hereby, unless such action is required
by applicable law, in each case other than under the circumstances described in Sections
3(e)(iii), (iv), (v) or (vi) below.
(b) An Exchange Offer Registration Statement pursuant to Section 2.1 hereof or
a Shelf Registration Statement pursuant to Section 2.2 hereof will not be deemed to
have become effective unless it has been declared effective by the SEC; provided,
however, that if, after it has been declared effective, the offering of Transfer
Restricted Notes pursuant to an Exchange Offer Registration Statement or a Shelf
Registration Statement is interfered with by any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court, such Registration
Statement will not be effective during the period of such interference, until the offering
of Transfer Restricted Notes pursuant to such Registration Statement may legally resume.
2.5 Additional Interest. In the event that either,
(a) the Exchange Offer Registration Statement is not filed with the SEC on or prior to
the 121st calendar day following the Closing Date, or a Shelf Registration Statement is not
filed with the SEC prior to the dates specified for such filing in Section 2.2
hereof;
(b) the Exchange Offer Registration Statement has not been declared effective by the
SEC under the 1933 Act on or prior to the 180th calendar day following the Closing Date, or
a Shelf Registration Statement is not declared effective by the SEC under the 1933 Act on or
prior to the 180th day after such filing obligation arises,
(c) the Exchange Offer is not consummated within 222 days following the Closing Date,
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(d) a Shelf Registration Statement is declared effective but thereafter, during the
period for which the Company and the Subsidiary Guarantors are required to maintain the
effectiveness of such Shelf Registration Statement, it ceases to be effective or usable in
connection with the resale of the Notes covered by such Shelf Registration Statement, or
(e) the Exchange Offer Registration Statement is declared effective, but thereafter,
during the Broker Prospectus Period, it ceases to be effective (or the Company or any
Subsidiary Guarantor restricts the use of the prospectus included therein) (each such event
referred to in these clauses (a) through (e) above, a “Registration
Default”),
then, the interest rate borne by the Transfer Restricted Notes shall be increased by one-quarter of
one percent (0.25%) per annum with respect to the first 90-day period (or portion thereof) while a
Registration Default is continuing immediately following the occurrence of such Registration
Default, which rate will increase by an additional one quarter of one percent (0.25%) per annum at
the beginning of each subsequent 90-day period (or portion thereof) while a Registration Default is
continuing until all Registration Defaults have been cured, provided that the maximum aggregate
increase in the interest rate on the Transfer Restricted Notes will in no event exceed one percent
(1.00%) per annum (the “Additional Interest”). Following the cure of all Registration Defaults the
accrual of Additional Interest will cease and the interest rate on the Transfer Restricted Notes
will revert to the original rate. Notwithstanding the foregoing, any Registration Default specified
in clause (a), (b) or (c) of this Section that relates to the Exchange
Offer Registration Statement or the Exchange Offer shall be deemed cured at such time as the Shelf
Registration Statement is declared effective by the SEC, or earlier upon the cure of the
Registration Default described therein.
If the Shelf Registration Statement is unusable by the Holders whose Transfer Restricted Notes
are covered thereby for any reason, and the aggregate number of days in any consecutive
twelve-month period for which the Shelf Registration Statement shall not be usable exceeds 30 days
in the aggregate, then the interest rate borne by such Holders’ Notes will be increased by
one-quarter of one percent (0.25%) per annum for the first 90-day period (or portion thereof)
beginning on the 31st day in any consecutive twelve-month period that such Shelf Registration
Statement ceases to be usable, which rate shall be increased by an additional one-quarter of one
percent (0.25%) per annum at the beginning of each subsequent 90-day period (or portion thereof) in
any consecutive twelve-month period during which the Shelf Registration Statement is unusable,
provided that the maximum aggregate increase in the interest rate on such Holder’s Notes will in no
event exceed one percent (1.00%) per annum. Any amounts payable under this paragraph shall also be
deemed “Additional Interest” for purposes of this Agreement. Upon any such Shelf Registration
Statement once again becoming usable, the interest rate borne by the Notes will be reduced to the
original interest rate if no other Registration Default shall be continuing at such time.
Additional Interest shall be computed based on the actual number of days elapsed in each 90-day
period in which the Shelf Registration Statement is unusable.
The Company shall notify the Trustee within three business days after each and every date on
which an event occurs in respect of which Additional Interest is required to be paid (an “Event
Date”). Any Additional Interest due shall be payable on each interest payment date to the Holder
of Notes with respect to which Additional Interest is due and owing. Each obligation
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to pay Additional Interest shall be deemed to accrue from and including the day following the
applicable Event Date.
3. Registration Procedures.
In connection with the obligations of the Company and the Subsidiary Guarantors with respect
to Registration Statements pursuant to Sections 2.1 and 2.2 hereof, the Company and
the Subsidiary Guarantors shall:
(a) prepare and file with the SEC a Registration Statement, within the relevant time
period specified in Section 2, on the appropriate form under the 1933 Act and the
rules promulgated thereunder, which form (i) shall be selected by the Company, (ii) shall,
in the case of a Shelf Registration, be available for the sale of the Transfer Restricted
Notes by the selling Holders thereof, (iii) shall comply as to form in all material respects
with the requirements of the applicable form and include or incorporate by reference all
financial statements required by the SEC to be filed therewith or incorporated by reference
therein, and (iv) shall comply in all respects with the requirements of Regulation S-T under
the 1933 Act;
(b) prepare and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary under applicable law to keep such Registration
Statement effective for the applicable period; and cause each Prospectus to be supplemented
by any required prospectus supplement, and as so supplemented to be filed pursuant to Rule
424 (or any similar provision then in force) under the 1933 Act and comply with the
provisions of the 1933 Act, the 1934 Act and the rules and regulations thereunder applicable
to them with respect to the disposition of all securities covered by each Registration
Statement during the applicable period in accordance with the intended method or methods of
distribution by the selling Holders thereof (including sales by any Participating
Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder of Transfer Restricted
Notes to be covered thereby, at least five business days prior to filing, that a Shelf
Registration Statement with respect to such Transfer Restricted Notes is being filed and
advising such Holders that the distribution of such Transfer Restricted Notes will be made
in accordance with the method selected by a majority in aggregate principal amount of the
Holders of Transfer Restricted Notes participating in the Shelf Registration; (ii) furnish
to each Holder of Transfer Restricted Notes to be covered thereby and to each underwriter of
an underwritten offering of Transfer Restricted Notes, if any, without charge, as many
copies of each Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder or underwriter may reasonably
request, including financial statements and schedules and, if the Holder so requests, all
exhibits in order to facilitate the public sale or other disposition of the Transfer
Restricted Notes; and (iii) do hereby consent to the use of the Prospectus or any amendment
or supplement thereto by each of the selling Holders of Transfer Restricted Notes in
connection with the offering and sale of the Transfer Restricted Notes covered by the
Prospectus or any amendment or supplement thereto;
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(d) use their best efforts to register or qualify the Transfer Restricted Notes under
all applicable state securities or “blue sky” laws of such jurisdictions as any Holder of
Transfer Restricted Notes covered by a Registration Statement and each underwriter of an
underwritten offering of Transfer Restricted Notes shall reasonably request by the time the
applicable Registration Statement is declared effective by the SEC, and do any and all other
acts and things which may be reasonably necessary or advisable to enable each such Holder
and underwriter to consummate the disposition in each such jurisdiction of such Transfer
Restricted Notes owned by such Holder; provided, however, that the Company
and the Subsidiary Guarantors shall not be required to (i) qualify as a foreign corporation
or as a dealer in securities in any jurisdiction where they would not otherwise be required
to qualify but for this Section 3(d), or (ii) take any action which would subject
them to general service of process or taxation in any such jurisdiction where they are not
then so subject;
(e) notify promptly each Holder of Transfer Restricted Notes under a Shelf Registration
or any Participating Broker-Dealer who has notified the Company that it is utilizing the
Exchange Offer Registration Statement as provided in paragraph (f) below and, if
requested by such Holder or Participating Broker-Dealer, confirm such advice in writing
promptly (i) when a Registration Statement has become effective and when any post-effective
amendments and supplements to a Registration Statement have become effective, (ii) of any
request by the SEC or any state securities authority for post-effective amendments and
supplements to a Registration Statement and Prospectus or for additional information after
the Registration Statement has become effective, (iii) of the issuance by the SEC or any
state securities authority of any stop order suspending the effectiveness of a Registration
Statement or the initiation of any proceedings for that purpose, (iv) in the case of a Shelf
Registration, if, between the effective date of a Registration Statement and the closing of
any sale of Transfer Restricted Notes covered thereby, the representations and warranties of
the Company and the Subsidiary Guarantors contained in any underwriting agreement,
securities sales agreement or other similar agreement, if any, relating to the offering
cease to be true and correct in all material respects, (v) of the happening of any event or
the discovery of any facts during the period a Shelf Registration Statement is effective
which makes any statement made in such Registration Statement or the related Prospectus
untrue in any material respect or which requires the making of any changes in such
Registration Statement or Prospectus in order to make the statements therein not misleading,
(vi) of the receipt by the Company of any notification with respect to the suspension of the
qualification of the Transfer Restricted Notes or the Exchange Notes, as the case may be,
for sale in any jurisdiction or the initiation or threatening of any proceeding for such
purpose and (vii) of any determination by the Company that a post-effective amendment to
such Registration Statement would be appropriate;
(f) in the case of the Exchange Offer Registration Statement (i) include in the
Exchange Offer Registration Statement a section entitled “Plan of Distribution” which
section shall be in customary form, and which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC with respect to the potential
“underwriter” status of any broker-dealer that holds Transfer Restricted Notes acquired for
its own account as a result of market-making activities or other trading activities and
12
that will be the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of
Exchange Notes to be received by such broker-dealer in the Exchange Offer, whether such
positions or policies have been publicly disseminated by the staff of the SEC or such
positions or policies, represent the prevailing views of the staff of the SEC, including a
statement that any such broker-dealer who receives Exchange Notes for Transfer Restricted
Notes pursuant to the Exchange Offer may be deemed a statutory underwriter and must deliver
a prospectus meeting the requirements of the 1933 Act in connection with any resale of such
Exchange Notes, (ii) furnish to each Participating Broker-Dealer who has delivered to the
Company the notice referred to in Section 3(e), without charge, as many copies of
each Prospectus included in the Exchange Offer Registration Statement, including any
preliminary prospectus, and any amendment or supplement thereto, as such Participating
Broker-Dealer may reasonably request, (iii) do hereby consent to the use of the Prospectus
forming part of the Exchange Offer Registration Statement or any amendment or supplement
thereto, by any Person subject to the prospectus delivery requirements of the SEC, including
all Participating Broker-Dealers, in connection with the sale or transfer of the Exchange
Notes covered by the Prospectus or any amendment or supplement thereto, and (iv) include in
the transmittal letter or similar documentation to be executed by an exchange offeree in
order to participate in the Exchange Offer (x) the following provision:
“If the exchange offeree is a broker-dealer holding Transfer Restricted
Notes acquired for its own account as a result of market-making activities
or other trading activities, it will deliver a prospectus meeting the
requirements of the 1933 Act in connection with any resale of Exchange Notes
received in respect of such Transfer Restricted Notes pursuant to the
Exchange Offer;” and
(y) a statement to the effect that by a broker-dealer’s making the acknowledgment described
in clause (x) and by delivering a Prospectus in connection with the exchange of Transfer
Restricted Notes, the broker-dealer will not be deemed to admit that it is an underwriter
within the meaning of the 1933 Act;
(g) make every reasonable effort to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement at the earliest possible moment;
(h) in the case of a Shelf Registration, furnish to each Holder of Transfer Restricted
Notes, and each underwriter, if any, without charge, at least one conformed copy of each
Registration Statement and any post-effective amendment thereto, including financial
statements and schedules (without documents incorporated therein by reference and all
exhibits thereto, unless requested);
(i) in the case of a Shelf Registration, cooperate with the selling Holders of Transfer
Restricted Notes to facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Notes to be sold and not bearing any restrictive legends;
and enable such Transfer Restricted Notes to be in such denominations (consistent with the
provisions of the Indenture) and registered in such names as the selling Holders or the
13
underwriters, if any, may reasonably request at least three business days prior to the
closing of any sale of Transfer Restricted Notes;
(j) in the case of a Shelf Registration, upon the occurrence of any event or the
discovery of any facts, each as contemplated by Sections 3(e)(v) and 3(e)(vi)
hereof, as promptly as practicable after the occurrence of such an event, use their best
efforts to prepare a supplement or post-effective amendment to the Registration Statement or
the related Prospectus or any document incorporated therein by reference or file any other
required document so that, as thereafter delivered to the purchasers of the Transfer
Restricted Notes or Participating Broker-Dealers, such Prospectus will not contain at the
time of such delivery any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading or will remain so qualified. At such time as such public
disclosure is otherwise made or the Company determines that such disclosure is not
necessary, in each case to correct any misstatement of a material fact or to include any
omitted material fact, the Company and the Subsidiary Guarantors agree promptly to notify
each Holder of such determination and to furnish each Holder such number of copies of the
Prospectus as amended or supplemented, as such Holder may reasonably request;
(k) in the case of a Shelf Registration, a reasonable time prior to the filing of any
Registration Statement, any Prospectus, any amendment to a Registration Statement or
amendment or supplement to a Prospectus, provide copies of such document to the Initial
Purchasers on behalf of such Holders; and make representatives of the Company and the
Subsidiary Guarantors as shall be reasonably requested by the Holders of Transfer Restricted
Notes, or the Initial Purchasers on behalf of such Holders, available for discussion of such
document;
(1) obtain a CUSIP number for all Exchange Notes, Private Exchange Notes or Transfer
Restricted Notes, as the case may be (with the understanding that the CUSIP number for the
Exchange Notes may be the same as the CUSIP number for an existing class of debt securities,
if any, issued by the Company under the Indenture), not later than the effective date of a
Registration Statement, and provide the Trustee with certificates for the Exchange Notes,
Private Exchange Notes or the Transfer Restricted Notes, as the case may be, in a form
eligible for deposit with the Depositary;
(m) (i) in the case of a Shelf Registration, cause the Indenture to be qualified under
the TIA in connection with the registration of the Transfer Restricted Notes, and, in the
case of an Exchange Offer Registration, cause or maintain, as the case may be, the Indenture
to be qualified under the TIA in connection with the registration of the Exchange Notes,
(ii) cooperate with the Trustee and the Holders to effect such changes to the Indenture as
may be required for the Indenture to be, or continue to be, so qualified in accordance with
the terms of the TIA and (iii) execute, and use their best efforts to cause the Trustee to
execute, all documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to be so qualified in a
timely manner;
14
(n) in the case of a Shelf Registration, enter into agreements (including underwriting
agreements) and take all other customary and appropriate actions in order to expedite or
facilitate the disposition of such Transfer Restricted Notes and if so requested by the
holders of such Transfer Restricted Notes and in such connection whether or not an
underwriting agreement is entered into and whether or not the registration is an
underwritten registration:
(i) make such representations and warranties to the Holders of such Transfer
Restricted Notes and the underwriters, if any, as the Company and the Subsidiary
Guarantors are able to make, in form, substance and scope as are customarily made by
issuers to underwriters in similar underwritten offerings as may be reasonably
requested by them;
(ii) in connection with an underwritten registration, obtain opinions of
counsel to the Company and the Subsidiary Guarantors and updates thereof (which
counsel and opinions (in form, scope and substance) shall be reasonably satisfactory
to the managing underwriters, if any, and the holders of a majority in principal
amount of the Transfer Restricted Notes being sold) addressed to each selling Holder
and the underwriters, if any, covering the matters customarily covered in opinions
requested in sales of securities or underwritten offerings and such other matters as
may be reasonably requested by such Holders and underwriters;
(iii) in connection with an underwritten registration, obtain “cold comfort”
letters and updates thereof from the Company’s and the Subsidiary Guarantor’s
independent certified public accountants (and, if necessary, any other independent
certified public accountants of any subsidiary of the Company or of any business
acquired by the Company for which financial statements are, or are required to be,
included in the Registration Statement) addressed to the underwriters, if any, and
use reasonable efforts to have such letter addressed to the selling Holders of
Transfer Restricted Notes (to the extent consistent with Statement on Auditing
Standards No. 72 of the American Institute of Certified Public Accountants), such
letters to be in customary form and covering matters of the type customarily covered
in “cold comfort” letters to underwriters in connection with similar underwritten
offerings;
(iv) enter into a securities sales agreement with the Holders and an agent of
the Holders providing for, among other things, the appointment of such agent for the
selling Holders for the purpose of soliciting purchases of Transfer Restricted
Notes, which agreement shall be in form, substance and scope customary for similar
offerings;
(v) if an underwriting agreement is entered into, cause the same to set forth
indemnification provisions and procedures substantially equivalent to the
indemnification provisions and procedures set forth in Section 4 hereof with
respect to the underwriters and all other parties to be indemnified pursuant to said
15
Section or, at the request of any underwriters, in the form customarily
provided to such underwriters in similar types of transactions; and
(vi) deliver such documents and certificates as may be reasonably requested and
as are customarily delivered in similar offerings to the Holders of a majority in
principal amount of the Transfer Restricted Notes being sold and the managing
underwriters, if any.
The above shall be done at (i) the effectiveness of such Shelf Registration Statement (and each
post-effective amendment thereto) and (ii) each closing under any underwriting or similar agreement
as and to the extent required thereunder;
(o) in the case of a Shelf Registration or if a Prospectus is required to be delivered
by any Participating Broker-Dealer in the case of an Exchange Offer, make available for
inspection by representatives of the Holders of the Transfer Restricted Notes, any
underwriters participating in any disposition pursuant to a Shelf Registration Statement,
any Participating Broker-Dealer and any counsel or accountant retained by any of the
foregoing, all non-confidential financial and other records, pertinent corporate documents
and properties of the Company or any Subsidiary Guarantor reasonably requested by any such
persons, and cause the respective officers, directors, employees, and any other agents of
the Company and the Subsidiary Guarantors to supply all information reasonably requested by
any such representative, underwriter, special counsel or accountant in connection with a
Registration Statement, and make such representatives of the Company and the Subsidiary
Guarantors available for discussion of such documents as shall be reasonably requested by
such persons;
(i) if so requested by the Initial Purchasers, in the case of an Exchange Offer
Registration Statement, a reasonable time prior to filing of any Exchange Offer
Registration Statement, any Prospectus forming a part thereof, any amendment to an
Exchange Offer Registration Statement or amendment or supplement to such Prospectus,
provide copies of such document to the Initial Purchasers and to counsel to the
Holders of Transfer Restricted Notes; and
(ii) in the case of a Shelf Registration, a reasonable time prior to filing any
Shelf Registration Statement, any Prospectus forming a part thereof, any amendment
to such Shelf Registration Statement or amendment or supplement to such Prospectus,
provide copies of such documents to the Initial Purchasers, if so requested, to the
Holders of Transfer Restricted Notes to be covered thereby, to counsel for such
Holders designated by them and to the underwriter or underwriters of an underwritten
offering of such Transfer Restricted Notes, if any, make such changes in any such
document prior to the filing thereof relating to such Holders or such Transfer
Restricted Notes as the counsel to the Holders or the underwriter or underwriters
reasonably request and not file any such document in a form to which the holders of
a majority in aggregate principal amount of Transfer Restricted Notes covered by
such Shelf Registration Statement, counsel for such Holders of the Transfer
Restricted Notes covered by such Shelf Registration Statement, or any underwriter
shall not have previously
16
been advised and furnished a copy of or to which the Majority Holders of
Transfer Restricted Notes covered by such Shelf Registration Statement, counsel to
such Holders of Transfer Restricted Notes or any underwriter shall reasonably
object, and make the representatives of the Company and the Subsidiary Guarantors
available for discussion of such document as shall be reasonably requested by such
Holders of Transfer Restricted Notes, the counsel for such Holders of Transfer
Restricted Notes or any underwriter;
(p) in the case of a Shelf Registration, use their best efforts to cause all Transfer
Restricted Notes to be listed on any securities exchange on which similar debt securities
issued by the Company and the Subsidiary Guarantors are then listed if requested by the
Holders of a majority in aggregate principal amount of such Transfer Restricted Securities
covered by such Shelf Registration Statement, or if requested by the underwriter or
underwriters of an underwritten offering of Transfer Restricted Notes, if any;
(q) in the case of a Shelf Registration, use their best efforts to cause the Transfer
Restricted Notes to be rated by the appropriate rating agencies, if so requested by the
Holders of a majority in aggregate principal amount of the Transfer Restricted Notes covered
by such Shelf Registration Statement, or if requested by the underwriter or underwriters of
an underwritten offering of Transfer Restricted Notes, if any;
(r) otherwise comply with all applicable rules and regulations of the SEC and make
available to their security holders, as soon as reasonably practicable, an earnings
statement covering at least 12 months which shall satisfy the provisions of Section 11 (a)
of the 1933 Act and Rule 158 thereunder; and
(s) cooperate and assist in any filings required to be made with the NASD and, in the
case of a Shelf Registration, in the performance of any due diligence investigation by any
underwriter and its counsel (including any “qualified independent underwriter” that is
required to be retained in accordance with the rules and regulations of the NASD).
In the case of a Shelf Registration Statement, the Company and the Subsidiary Guarantors may
(as a condition to such Holder’s participation in the Shelf Registration) require each Holder of
Transfer Restricted Notes to furnish to the Company and Subsidiary Guarantors such information
regarding the Holder and the proposed distribution by such Holder of such Transfer Restricted Notes
as the Company and Subsidiary Guarantors may from time to time reasonably request in writing.
In the case of a Shelf Registration Statement, each Holder agrees that, upon receipt of any
notice from the Company or any Subsidiary Guarantor of the happening of any event or the discovery
of any facts, each of the kind described in Section 3(e)(v) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Notes pursuant to a Registration Statement
until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(k) hereof, and, if so directed by the Company and Subsidiary Guarantors, such
Holder will deliver to the Company and Subsidiary Guarantors (at its expense)
17
all copies in such Holder’s possession, other than permanent file copies then in such Holder’s
possession, of the Prospectus covering such Transfer Restricted Notes current at the time of
receipt of such notice.
If any of the Transfer Restricted Notes covered by any Shelf Registration Statement are to be
sold in an underwritten offering, the underwriter or underwriters and manager or managers that will
manage such offering will be selected by the Majority Holders of such Transfer Restricted Notes to
be included in such offering and shall be acceptable to the Company and Subsidiary Guarantors. No
Holder of Transfer Restricted Notes may participate in any underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder’s Transfer Restricted Notes on the basis provided
in any underwriting arrangements approved by the persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such underwriting
arrangements.
4. Indemnification; Contribution.
(a) The Company and the Subsidiary Guarantors agree to indemnify, jointly and
severally, and hold harmless the Initial Purchasers and each of their affiliates and any
other Person under common control with the Initial Purchasers, each Holder, each
Participating Broker-Dealer, each Person who participates as an underwriter (any such Person
being an “Underwriter”) and each Person, if any, who controls any Holder or Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, arising out of any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement (or any amendment or
supplement thereto) pursuant to which Exchange Notes or Transfer Restricted Notes
were registered under the 1933 Act, including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus (or any amendment or supplement thereto) or the omission
or alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made,
not misleading;
(ii) against any and all loss, liability, claim, damage and expense whatsoever,
as incurred, to the extent of the aggregate amount paid in settlement of any
litigation, or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission; provided
that (subject to Section 4(d) below) any such settlement is effected with
the written consent of the Company and the Subsidiary Guarantors; and
18
(iii) against any and all expense whatsoever, as incurred (including the fees
and disbursements of counsel chosen by any indemnified party), reasonably incurred
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that any
such expense is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue statement or omission
or alleged untrue statement or omission made in reliance upon and in conformity with written
information concerning any Holder or Underwriter furnished to the Company by the Holder or
Underwriter expressly for use in a Registration Statement (or any amendment thereto) or any
Prospectus (or any amendment or supplement thereto); and provided, further, that
the indemnity agreement contained in this subsection (a) shall not inure to the benefit of
any Holder or Participating Broker-Dealer from whom the person asserting any such losses, claims,
damages or liabilities purchased the Notes concerned, to the extent that a prospectus relating to
such Notes was required to be delivered by such Holder or Participating Broker-Dealer under the
1933 Act in connection with such purchase and any such loss, claim, damage or liability of such
Holder or Participating Broker-Dealer results from the fact that there was not sent or given to
such person, at or prior to the sale of such Notes to such person, a copy of such prospectus if the
Company had previously furnished copies thereof to such Holder or Participating Broker-Dealer.
(b) Each Holder, severally, but not jointly, agrees to indemnify and hold harmless the
Company, the Subsidiary Guarantors, each Underwriter and the other selling Holders, and each
of their respective directors and officers, and each Person, if any, who controls the
Company, any Subsidiary Guarantor, any Underwriter or any other selling Holder within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any and all
loss, liability, claim, damage and expense described in the indemnity contained in
Section 4(a) hereof, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Shelf Registration
Statement (or any amendment thereto) or any Prospectus included therein (or any amendment or
supplement thereto) in reliance upon and in conformity with written information with respect
to such Holder furnished to the Company and the Subsidiary Guarantors by such Holder
expressly for use in the Shelf Registration Statement (or any amendment thereto) or such
Prospectus (or any amendment or supplement thereto); provided, however, that
no such Holder shall be liable for any claims hereunder in excess of the amount of net
proceeds received by such Holder from the sale of Transfer Restricted Notes pursuant to such
Shelf Registration Statement.
(c) Each indemnified party shall give notice as promptly as reasonably practicable to
each indemnifying party of any action or proceeding commenced against it in respect of which
indemnity may be sought hereunder, but failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it from any
liability which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the
19
defense of such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying party or parties be
liable for the fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall, without the
prior written consent of the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim whatsoever in respect
of which indemnification or contribution could be sought under this Section 4
(whether or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 4 is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect of any
losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying
party shall contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, in such proportion as is
appropriate to reflect the relative fault of the Company and the Subsidiary Guarantors, on
the one hand, and the Holders and the Initial Purchasers, on the other hand, in connection
with the statements or omissions which resulted in such losses, liabilities, claims, damages
or expenses, as well as any other relevant equitable considerations.
The relative fault of the Company and the Subsidiary Guarantors on the one hand and the
Holders and the Initial Purchasers on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information supplied by
the Company, the Subsidiary Guarantors, the Holders or the Initial Purchasers and the
parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company, the Subsidiary Guarantors, the Holders and the Initial Purchasers agree
that it would not be just and equitable if contribution pursuant to this Section 4
were determined by pro rata allocation (even if the Initial Purchasers were treated as one
entity for such purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 4. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party
and referred to above in this Section 4 shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue
or alleged untrue statement or omission or alleged omission.
20
No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the 0000 Xxx) shall be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation.
For purposes of this Section 4, each Person, if any, who controls an Initial Purchaser
or Holder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as such Initial Purchaser or Holder, and each director of the
Company or any Subsidiary Guarantor, and each Person, if any, who controls the Company or any
Subsidiary Guarantor within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company and the Subsidiary Guarantors. The
Initial Purchasers’ respective obligations to contribute pursuant to this Section 4 are
several in proportion to the principal amount of Notes set forth opposite their respective names in
Schedule A to the Purchase Agreement and not joint. Notwithstanding the provisions of this
Section 4, in no event shall a Holder be required to contribute any amount in excess of the
amount by which the total price at which all of the Notes sold by such Holder exceeds the amount of
any damages that such Holder has otherwise been required to pay under Section 4(b) hereof.
5. Miscellaneous.
5.1 Rule 144 and Rule 144A. For so long as the Company and the Subsidiary Guarantors
are subject to the reporting requirements of Section 13 or 15 of the 1934 Act, the Company and the
Subsidiary Guarantors covenant that they will file and furnish the reports required to be filed by
them under the 1933 Act and Section 13(a) or 15(d) of the 1934 Act and the rules and regulations
adopted by the SEC thereunder. If the Company and the Subsidiary Guarantors cease to be so
required to file and furnish such reports, the Company and Subsidiary Guarantors covenant that they
will upon the request of any Holder of Transfer Restricted Notes (a) make publicly available such
information as is necessary to permit sales pursuant to Rule 144 under the 1933 Act, (b) deliver
such information to a prospective purchaser as is necessary to permit sales pursuant to Rule 144A
under the 1933 Act and take such further action as any Holder of Transfer Restricted Notes may
reasonably request, and (c) take such further action that is reasonable in the circumstances, in
each case, to the extent required from time to time to enable such Holder to sell its Transfer
Restricted Notes without registration under the 1933 Act within the limitation of the exemptions
provided by (i) Rule 144 under the 1933 Act, as such Rule may be amended from time to time, (ii)
Rule 144A under the 1933 Act, as such Rule may be amended from time to time, or (iii) any similar
rules or regulations hereafter adopted by the SEC. Upon the request of any Holder of Transfer
Restricted Notes, the Company and the Subsidiary Guarantors will deliver to such Holder a written
statement as to whether they have complied with such requirements.
5.2 No Inconsistent Agreements. The Company and the Subsidiary Guarantors have not
entered into, and the Company and the Subsidiary Guarantors will not after the date of this
Agreement enter into, any agreement which is inconsistent with the rights granted to the Holders of
Transfer Restricted Notes in this Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not and will not for the term of this Agreement in any
way conflict with the rights granted to the holders of the Company’s or Subsidiary Guarantors’
other issued and outstanding securities under any such agreements.
21
5.3 Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the Company and the Subsidiary
Guarantors have obtained the written consent of Holders of at least a majority in aggregate
principal amount of the outstanding Transfer Restricted Notes affected by such amendment,
modification, supplement, waiver or departure.
5.4 Notices. All notices and other communications provided for or permitted hereunder
shall be made in writing by hand delivery, registered first-class mail, telex, telecopier, or any
courier guaranteeing overnight delivery (a) if to a Holder, at the most current address given by
such Holder to the Company by means of a notice given in accordance with the provisions of this
Section 5.4, which address initially, and until so changed, is the address set forth in the
Purchase Agreement with respect to the Initial Purchasers; and (b) if to the Company and the
Subsidiary Guarantors, initially at the Company’s address set forth in the Purchase Agreement, and
thereafter at such other address of which notice is given in accordance with the provisions of this
Section 5.4.
All such notices and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; two business days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if
telecopied; and on the next business day if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications shall be concurrently delivered
by the person giving the same to the Trustee under the Indenture at the address specified therein.
5.5 Successor and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors, assigns and transferees of each of the parties, including, without
limitation and without the need for an express assignment, subsequent Holders; provided
that nothing herein shall be deemed to permit any assignment, transfer or other disposition of
Transfer Restricted Notes in violation of the terms of the Purchase Agreement or the Indenture. If
any transferee of any Holder shall acquire Transfer Restricted Notes, in any manner, whether by
operation of law or otherwise, such Transfer Restricted Notes shall be held subject to all of the
terms of this Agreement, and by taking and holding such Transfer Restricted Notes such person shall
be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions
of this Agreement, including the restrictions on resale set forth in this Agreement and, if
applicable, the Purchase Agreement, and such person shall be entitled to receive the benefits
hereof.
5.6 Third Party Beneficiaries. The Initial Purchasers (even if the Initial Purchasers
are not Holders of Transfer Restricted Notes) shall be third party beneficiaries to the agreements
made hereunder between the Company and the Subsidiary Guarantors, on the one hand, and the Holders,
on the other hand, and shall have the right to enforce such agreements directly to the extent they
deem such enforcement necessary or advisable to protect their rights or the rights of Holders
hereunder. Each Holder of Transfer Restricted Notes shall be a third party beneficiary to the
agreements made hereunder between the Company and the Subsidiary
22
Guarantors, on the one hand, and the Initial Purchasers, on the other hand, and shall have the
right to enforce such agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights hereunder.
5.7 Specific Enforcement. Without limiting the remedies available to the Initial
Purchasers and the Holders, the Company and the Subsidiary Guarantors acknowledge that any failure
by the Company or the Subsidiary Guarantors to comply with their obligations under Sections
2.1 through 2.4 hereof may result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at law, that it would not be
possible to measure damages for such injuries precisely and that, in the event of any such failure,
the Initial Purchasers or any Holder may obtain such relief as may be required to specifically
enforce the Company’s and Subsidiary Guarantors’ obligations under Sections 2.1 through
2.4 hereof.
5.8 Restriction on Resales. Until the expiration of two years after the original
issuance of the Notes and the Guarantees, the Company and the Subsidiary Guarantors will not, and
will cause their “affiliates” (as such term is defined in Rule 144(a)(1) under the 0000 Xxx) not
to, resell any Notes and Guarantees which are “restricted securities” (as such term is defined
under Rule 144(a)(3) under the 0000 Xxx) that have been reacquired by any of them and shall
immediately upon any purchase of any such Notes and Subsidiary Guarantees submit such Notes and
Subsidiary Guarantees to the Trustee for cancellation.
5.9 Counterparts. This Agreement may be executed in any number of counterparts and by
the parties hereto in separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same agreement.
5.10 Headings. The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.
5.11 Governing Law. This Agreement shall be governed by and construed in accordance
with the law of the state of Nevada without regard to the principles of conflict of laws thereof.
5.12 Severability. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable,
the validity, legality and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.
5.13 Agreement Regarding Tracinda. The Initial Purchasers hereby agree that in the
event (i) there is any breach or default or alleged breach or default by the Company under this
Agreement or (ii) the Initial Purchasers have or may have any claim arising from or relating to the
terms hereof, the Initial Purchasers shall not commence any lawsuit or otherwise seek to impose any
liability whatsoever against Xxxx Xxxxxxxxx or Tracinda Corporation (collectively, “Tracinda”),
unless Tracinda shall have commenced a lawsuit or otherwise initiated any claim against the Initial
Purchasers arising from or relating to this Agreement (a
23
“Tracinda Action”). The Initial Purchasers hereby further agree that unless a Tracinda Action
has been commenced: (i) Tracinda shall not have any liability whatsoever with respect to this
Agreement or any matters relating to or arising from this Agreement, including any alleged breach
of or default under this Agreement by the Company; and (ii) the Initial Purchasers shall not assert
or permit any party claiming through it to assert a claim or impose any liability against Tracinda
as to any matter or thing arising out of or relating to this Agreement or any alleged breach or
default under this Agreement by the Company. In addition, the Initial Purchasers agree that
Tracinda is not a party to this Agreement.
[signature page follows]
24
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.
| MGM MIRAGE, a Delaware corporation |
||||
| By: | /s/ Xxxxx X. Xxxxxx | |||
| Name: | Xxxxx X. Xxxxxx | |||
| Title: | Senior Vice President – Assistant General Counsel and Assistant Secretary |
|||
| Joined in and agreed to and accepted by the | ||||||||
| following Subsidiary Guarantors as of the date first above written: | ||||||||
| AC Holding Corp., a Nevada corporation | ||||||||
| AC Holding Corp. II, a Nevada corporation | ||||||||
| The Xxxxx Xxxx Companies, a Nevada corporation | ||||||||
| Beau Rivage Distribution Corp., a Mississippi corporation | ||||||||
| Beau Rivage Resorts, Inc., a Mississippi corporation | ||||||||
| Bellagio, LLC, a Nevada limited liability company | ||||||||
| Bellagio II, LLC, a Nevada limited liability company | ||||||||
| Boardwalk Casino, Inc., a Nevada corporation | ||||||||
| Bungalow, Inc., a Mississippi corporation | ||||||||
| Circus Circus Mississippi, Inc., a Mississippi corporation | ||||||||
| Circus Circus Casinos, Inc., a Nevada corporation | ||||||||
| Colorado Belle Corp., a Nevada corporation | ||||||||
| Country Star Las Vegas, LLC, a Nevada limited liability company | ||||||||
| Destron, Inc., a Nevada corporation | ||||||||
| Diamond Gold, Inc., a Nevada corporation | ||||||||
| Edgewater Hotel Corporation, a Nevada corporation | ||||||||
| Galleon, Inc., a Nevada corporation | ||||||||
| Gold Strike Aviation, Incorporated, a Nevada corporation | ||||||||
| Gold Strike Fuel Company, a Nevada partnership | ||||||||
| By: Oasis Development Company, Inc., a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| Gold Strike L.V., a Nevada partnership | ||||||||
| By: Diamond Gold Inc., a Nevada corporation, Partner | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
S-2
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| Goldstrike Finance Company, Inc., a Nevada corporation | ||||||||
| Goldstrike Investments, Incorporated, a Nevada corporation | ||||||||
| Grand Laundry, Inc., a Nevada corporation | ||||||||
| Xxxx Development Company, a Nevada partnership | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| Xxxx Development West, a Nevada partnership | ||||||||
| By: Diamond Gold Inc., a Nevada corporation, Partner | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| Xxxx Fuel Company West, a Nevada partnership | ||||||||
| By: Oasis Development Company, Inc., a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| Last Chance Investments, Incorporated, a Nevada corporation | ||||||||
| LV Concrete Corp., a Nevada corporation | ||||||||
| MAC, Corp., a New Jersey corporation | ||||||||
| Mandalay Corp., a Nevada corporation | ||||||||
| Mandalay Marketing and Events, a Nevada corporation | ||||||||
| Mandalay Place (f.k.a. New Dirt, Inc.), a Nevada corporation | ||||||||
| Mandalay Resort Group, a Nevada corporation | ||||||||
| Metropolitan Marketing, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Atlantic City, Inc., a New Jersey corporation |
||||||||
| MGM Grand Condominiums, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Condominiums II, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Condominiums III, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Detroit, Inc., a Delaware corporation | ||||||||
S-3
| MGM Grand Hotel, LLC, a Nevada limited liability company |
||||||||
| MGM Grand New York, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Resorts, LLC, a Nevada limited liability company | ||||||||
| MGM Grand Resorts Development (f.k.a. Mandalay Development), a Nevada corporation | ||||||||
| MGM MIRAGE Advertising, Inc., a Nevada corporation | ||||||||
| MGM MIRAGE Aircraft Holdings, LLC, a Nevada limited liability company | ||||||||
| MGM MIRAGE Aviation Corp., a Nevada corporation | ||||||||
| MGM MIRAGE Corporate Services, a Nevada corporation | ||||||||
| MGM MIRAGE Design Group, a Nevada corporation | ||||||||
| MGM MIRAGE Development, Inc., a Nevada corporation | ||||||||
| MGM MIRAGE Entertainment and Sports, a Nevada corporation | ||||||||
| MGM MIRAGE International, a Nevada corporation MGM MIRAGE Manufacturing Corp., a Nevada corporation MGM MIRAGE Operations, Inc., a Nevada corporation MGM MIRAGE Retail, a Nevada corporation MH, Inc., a Nevada corporation M.I.R. Travel, a Nevada corporation The Mirage Casino-Hotel, a Nevada corporation Mirage Laundry Services Corp., a Nevada corporation Mirage Leasing Corp., a Nevada corporation Mirage Resorts, Incorporated, a Nevada corporation MMNY Land Company, Inc., a New York corporation MRG Vegas Portal, Inc., a Nevada corporation MRGS Corp., a Nevada corporation M.S.E. Investments, Incorporated, a Nevada corporation Nevada Landing Partnership, an Illinois partnership |
||||||||
| By: Diamond Gold, Inc., a Nevada corporation, Partner | ||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||
| corporation, Partner | ||||||||
| New Castle Corp., a Nevada corporation New PRMA Las Vegas, Inc., a Nevada corporation New York-New York Hotel & Casino, LLC, a Nevada limited liability company New York-New York Tower, LLC, a Nevada limited liability company Oasis Development Company, Inc., a Nevada corporation Plane Truth, LLC, a Nevada limited liability company |
||||||||
S-4
| The Primadonna Company, LLC, a Nevada limited liability company PRMA Land Development Company, a Nevada corporation PRMA, LLC, a Nevada limited liability company Project CC, LLC, a Nevada limited liability company Railroad Pass Investment Group, a Nevada partnership |
||||||||||
| By: Goldstrike Investments, Incorporated, a Nevada | ||||||||||
| corporation, Partner | ||||||||||
| By: Last Chance Investments, Incorporated, a Nevada | ||||||||||
| corporation, Partner | ||||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||||
| corporation, Partner | ||||||||||
| Ramparts International, a Nevada corporation Ramparts, Inc., a Nevada corporation Restaurant Ventures of Nevada, Inc., a Nevada corporation Slots-A-Fun, Inc., a Nevada corporation Treasure Island Corp., a Nevada corporation Victoria Partners, a Nevada partnership |
||||||||||
| By: MRGS Corp., a Nevada corporation, Partner | ||||||||||
| By: Gold Strike L.V., a Nevada partnership, Partner | ||||||||||
| By: Diamond Gold Inc., a Nevada corporation, | ||||||||||
| Partner | ||||||||||
| By: Goldstrike Investments, Incorporated, a | ||||||||||
| Nevada corporation, Partner | ||||||||||
| By: Last Chance Investments, Incorporated, a | ||||||||||
| Nevada corporation, Partner | ||||||||||
| By: M.S.E. Investments, Incorporated, a Nevada | ||||||||||
| corporation, Partner | ||||||||||
| VidiAd, a Nevada corporation | ||||||||||
[The remainder of this page is intentionally left blank. Signature on the following page.]
S-5
| By: | /s/ Xxxxx X. Xxxxxx | |||
| Name: | Xxxxx X. Xxxxxx | |||
| Title: | Assistant Secretary or Attorney-in-Fact, as applicable, of each of the foregoing |
|||
CONFIRMED AND ACCEPTED,
as of the date first above written:
as of the date first above written:
| BANC OF AMERICA SECURITIES LLC | ||||
By:
|
/s/ Xxxx Xxxxxx | |||
| Name: Xxxx Xxxxxx Title: Managing Director |
||||
For itself and as representative of the other Initial Purchasers
S-2
Schedule A
Initial Purchaser
Banc of America Securities LLC
Citigroup Global Markets Inc.
Deutsche Bank Securities Inc.
Merrill, Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated
S-3
