EXECUTION COPY
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EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
Dated as of July 8, 1998
by and among
EPIC RESORTS, LLC,
EPIC CAPITAL CORP.,
THE SUBSIDIARY GUARANTORS,
named herein
and
NATWEST CAPITAL MARKETS LIMITED
As the Initial Purchaser
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$130,000,000
13% SENIOR SECURED NOTES DUE 2005
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
This Exchange and Registration Rights Agreement (the "Agreement") is
dated as of July 8, 1998, by and among Epic Resorts, LLC, a Delaware limited
liability company ("Epic"), Epic Capital Corp., a Delaware corporation
("Capital Corp." and together with Epic, the "Note Issuers"), the subsidiary
guarantors party hereto (collectively, the "Subsidiary Guarantors") and NatWest
Capital Markets Limited (the "Initial Purchaser").
This Agreement is entered into in connection with the Purchase
Agreement, dated June 30, 1998, among the Note Issuers, Epic Warrant Co., the
Subsidiary Guarantors and the Initial Purchaser (the "Purchase Agreement"),
which provides for the sale by the Note Issuers to the Initial Purchaser of
Units consisting in part of $130,000,000 aggregate principal amount of the Note
Issuers' 13% Senior Secured Notes due 2005 (the "Notes"), which notes will be
guaranteed by the Subsidiary Guarantors. The Note Issuers and the Subsidiary
Guarantors are collectively referred to herein as the "Issuers." In order to
induce the Initial Purchaser to enter into the Purchase Agreement, the Note
Issuers have agreed to provide the registration rights set forth in this
Agreement for the benefit of the Initial Purchaser and their direct and
indirect transferees. The execution and delivery of this Agreement is a
condition to the obligation of the Initial Purchaser to purchase the Notes
under the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings:
ADDITIONAL INTEREST: Has the meaning provided in Section 4(a)
hereof.
ADVICE: Has the meaning provided in the last paragraph of Section 5
hereof.
AGREEMENT: Has the meaning provided in the first introductory
paragraph hereto.
APPLICABLE PERIOD: Has the meaning provided in Section 2(b) hereof.
CLOSING DATE: Has the meaning provided in the Purchase Agreement.
EFFECTIVENESS DATE: The 135th day after the Issue Date.
EFFECTIVENESS PERIOD: Has the meaning provided in Section 3(a)
hereof.
EVENT DATE: Has the meaning provided in Section 4(b) hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.
EXCHANGE NOTES: Has the meaning provided in Section 2(a) hereof.
EXCHANGE OFFER: Has the meaning provided in Section 2(a) hereof.
EXCHANGE REGISTRATION STATEMENT: Has the meaning provided in Section
2(a) hereof.
FILING DATE: The 75th day after the Issue Date.
HOLDER: Any holder of a Registrable Note or Registrable Notes.
INDEMNIFIED PERSON: Has the meaning provided in Section 7(c) hereof.
INDEMNIFYING PERSON: Has the meaning provided in Section 7(c)
hereof.
INDENTURE: The Indenture, dated as of July 8, 1998 among the Note
Issuers and United States Trust Company of New York, as trustee, pursuant to
which the Notes are being issued, as amended or supplemented from time to time
in accordance with the terms thereof.
INITIAL PURCHASER: Has the meaning provided in the first
introductory paragraph hereto.
INSPECTORS: Has the meaning provided in Section 5(n) hereof.
ISSUE DATE: The date on which the original Notes were sold to the
Initial Purchaser pursuant to the Purchase Agreement.
NASD: Has the meaning provided in Section 5(r) hereof.
NOTE ISSUERS: Has the meaning provided in the first introductory
paragraph hereto.
NOTES: Has the meaning provided in the second introductory paragraph
hereto.
PARTICIPANT: Has the meaning provided in Section 7(a) hereof.
PARTICIPATING BROKER-DEALER: Has the meaning provided in Section
2(b) hereof.
PERSONS: An individual, trustee, corporation, partnership, limited
liability company, joint stock company, trust, unincorporated association,
union, business association, firm or other legal entity.
PRIVATE EXCHANGE: Has the meaning provided in Section 2(b) hereof.
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PRIVATE EXCHANGE NOTES: Has the meaning provided in Section 2(b)
hereof.
PROSPECTUS: The prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, and all other amendments and supplements to the
Prospectus, with respect to the terms of the offering of any portion of the
Registrable Notes covered by such Registration Statement including post-
effective amendments, and all material incorporated by reference or deemed to
be incorporated by reference in such Prospectus.
PURCHASE AGREEMENT: Has the meaning provided in the second
introductory paragraph hereto.
RECORDS: Has the meaning provided in Section 5(n) hereof.
REGISTRABLE NOTES: Each Note upon original issuance of the Notes,
and at all times subsequent thereto, each Exchange Note as to which Section
2(c)(iv) hereof is applicable upon original issuance and at all times
subsequent thereto and each Private Exchange Note upon original issuance
thereof and at all times subsequent thereto, until in the case of any such
Note, Exchange Note or Private Exchange Note, as the case may be, the earliest
to occur of (i) a Registration Statement covering such Note, Exchange Note or
Private Exchange Note, as the case may be, has been declared effective by the
SEC and such Note (unless such Note was not tendered for exchange by the Holder
thereof), Exchange Note or Private Exchange Note, as the case may be, has been
disposed of in accordance with such effective Registration Statement, (ii) such
Note, Exchange Note or Private Exchange Note, as the case may be, is, or may
be, sold in compliance with Rule 144, or (iii) such Note, Exchange Note or
Private Exchange Note, as the case may be, ceases to be outstanding for
purposes of the Indenture.
REGISTRATION STATEMENT: Any registration statement of the Company,
including, but not limited to, the Exchange Registration Statement, that covers
any of the Registrable Notes pursuant to the provisions of this Agreement,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
RULE 144: Rule 144 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than Rule
144A) or regulation hereafter adopted by the SEC providing for offers and sales
of securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
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RULE 144A: Rule 144A promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than Rule
144) or regulation hereafter adopted by the SEC.
RULE 415: Rule 415 promulgated under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
SECURITIES ACT: The Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
SHELF REGISTRATION: Has the meaning provided in Section 3(a) hereof.
SHELF REGISTRATION STATEMENT: shall mean a "shelf" registration
statement of the Note Issuers and the Subsidiary Guarantors which covers all of
the Registrable 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.
SHELF NOTICE: Has the meaning provided in Section 2(c) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
TRUSTEE(S): The trustee under the Indenture and, the trustee under
any other indenture governing the Exchange Notes and Private Exchange Notes (if
any).
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERINGS: A registration
in which securities of one or more of the Note Issuers are sold to an
underwriter for reoffering to the public.
2. EXCHANGE OFFER
(a) Each of the Note Issuers agrees to file with the SEC no later
than the Filing Date an offer to exchange (the "Exchange Offer") any and all of
the Registrable Notes (other than the Private Exchange Notes, if any) for a
like aggregate principal amount of debt securities of the Note Issuers, which
are identical in all material respects to the Notes (the "Exchange Notes") (and
which are entitled to the benefits of the Indenture or a trust indenture which
is identical in all material respects to the Indenture (other than such changes
to the Indenture or any such identical trust indenture as are necessary to
comply with any requirements of the SEC to effect or maintain the qualification
thereof under the TIA) and which, in either case, has been qualified under the
TIA), except that the Exchange Notes (other than Private Exchange Notes, if
any) shall have been registered pursuant to an effective Registration Statement
under the Securities Act and shall contain no restrictive legend thereon. The
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Exchange Offer shall be registered under the Securities Act on the appropriate
form (the "Exchange Registration Statement") and shall comply with all ap
plicable tender offer rules and regulations under the Exchange Act. The Note
Issuers agree to use their reasonable best efforts to (x) cause the Exchange
Registration Statement to be declared effective under the Securities Act no
later than the 135th day after the Issue Date; (y) keep the Exchange Offer open
for at least 20 business days (or longer if required by applicable law) after
the date that notice of the Exchange Offer is mailed to the Holders; and (z)
consummate the Exchange Offer on or prior to the 165th day following the Issue
Date. If after such Exchange Registration Statement is declared effective by
the SEC, the Exchange Offer or the issuance of the Exchange Notes thereunder is
interfered with by any stop order, injunction or other order or requirement of
the SEC or any other governmental agency or court, such Exchange Registration
Statement shall be deemed not to have become effective for purposes of this
Agreement until such stop order, injunction or other order or requirement is no
longer in effect. Each Holder who participates in the Exchange Offer will be
required to represent that any Exchange Notes received by it will be acquired
in the ordinary course of its business, that at the time of the consummation of
the Exchange Offer such Holder will have no arrangement or understanding with
any Person to participate in the distribution of the Exchange Notes in
violation of the provisions of the Securities Act, and that such Holder is not
an "affiliate" of the Note Issuers within the meaning of the Securities Act.
Upon consummation of the Exchange Offer in accordance with this Section 2, the
Note Issuers shall have no further obligation to register Registrable Notes
(other than Private Exchange Notes) pursuant to Section 3 hereof. No
securities other than the Exchange Notes shall be included in the Exchange
Registration Statement.
(b) The Note Issuers shall include within the Prospectus contained
in the Exchange Registration Statement a section entitled "Plan of
Distribution," in the form of Annex A hereto, reasonably acceptable to the
Initial Purchaser, 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 is the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Notes received by
such broker-dealer in the Exchange Offer (a "Participating Broker-Dealer"),
whether such positions or policies have been publicly disseminated by the Staff
of the SEC or such positions or policies, in the judgment of the Initial
Purchaser, represent the prevailing views of the Staff of the SEC. Such "Plan
of Distribution" section shall also expressly permit the use of the Prospectus
by all Persons subject to the prospectus delivery requirements of the
Securities Act, including all Participating Broker-Dealers, and include a
statement describing the means by which Participating Broker-Dealers may resell
the Exchange Notes. The Note Issuers shall also include the information set
forth in Annex B hereto in the Letter of Transmittal delivered pursuant to the
Exchange Offer.
The Note Issuers agree to use their reasonable best efforts to keep
the Exchange Registration Statement effective and to amend and supplement the
Prospectus contained therein, in order to permit such Prospectus to be lawfully
delivered by any Participating Broker-Dealer subject to the prospectus delivery
requirements of the Securities Act for such period of time as is necessary to
comply with applicable law in connection with any resale of the Exchange Notes;
PROVIDED, HOWEVER, that such period shall not exceed 165 days after the
consummation of the
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Exchange Offer (or such longer period if extended pursuant to the last
paragraph of Section 5 hereof) (the "Applicable Period").
If, prior to consummation of the Exchange Offer, the Initial
Purchaser holds any Notes acquired by it and having the status of an unsold
allotment in the initial distribution, the Note Issuers shall, upon the request
of the Initial Purchaser, simultaneously with the delivery of the Exchange
Notes in the Exchange Offer, issue and deliver to the Initial Purchaser in
exchange (the "Private Exchange") for such Notes held by the Initial Purchaser
a like principal amount of debt securities of the Note Issuers, that are
identical in all material respects to the Exchange Notes (the "Private Exchange
Notes") (and which are issued pursuant to the same Indenture as the Exchange
Notes) except for the placement of a restrictive legend on such Private
Exchange Notes. The Private Exchange Notes shall if permissible bear the same
CUSIP number as the Exchange Notes.
Interest on the Exchange Notes and the Private Exchange Notes will
accrue from the last interest payment date on which interest was paid on the
Notes surrendered in exchange therefor or, if no interest has been paid on the
Notes, from the Issue Date.
In connection with the Exchange Offer, the Note Issuers shall:
(1) mail to each Holder a copy of the Prospectus forming part of the
Exchange Registration Statement together with an appropriate letter of
transmittal and related documents;
(2) utilize the services of a depositary for the Exchange Offer with
an address in the Borough of Manhattan, The City of New York;
(3) permit Holders to withdraw tendered Notes at any time prior to
the close of business, New York time, on the last business day on which
the Exchange Offer shall remain open; and
(4) otherwise comply in all material respects with all applicable
laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer or the
Private Exchange, as the case may be, the Note Issuers shall:
(1) accept for exchange all Notes tendered and not validly withdrawn
pursuant to the Exchange Offer or the Private Exchange;
(2) deliver to the Trustee for cancellation all Notes so accepted
for exchange; and
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(3) cause the Trustee to authenticate and deliver promptly to each
Holder Exchange Notes or Private Exchange Notes, as the case may be, equal
in principal amount to the Notes of such Holder so accepted for exchange.
The Exchange Notes and the Private Exchange Notes are to be issued
under (i) the Indenture or (ii) an indenture identical in all material respects
to the Indenture, which in either event shall provide that (1) the Exchange
Notes shall not be subject to the transfer restrictions set forth in the
Indenture and (2) the Private Exchange Notes shall be subject to the transfer
restrictions set forth in the Indenture. The Indenture or such other indenture
shall provide that the Exchange Notes, the Private Exchange Notes and the Notes
shall vote and consent together on all matters as to which they have the right
to vote or consent as one class and that none of the Exchange Notes, the
Private Exchange Notes or the Notes will have the right to vote or consent as a
separate class on any matter.
(c) If, (i) because of any change in law or in currently prevailing
interpretations of the Staff of the SEC, the Note Issuers are not permitted to
effect an Exchange Offer, (ii) the Exchange Offer is not consummated within 165
days after the Issue Date, (iii) any holder of Private Exchange Notes so
requests at any time after the consummation of the Private Exchange, or (iv)
any Holder (other than the Initial Purchaser) is not eligible to participate in
the Exchange Offer, then the Note Issuers shall promptly deliver to the Holders
and the Trustee written notice thereof (the "Shelf Notice") and, in the case of
clauses (i) and (ii) above, all Holders, in the case of clause (iii) above, the
Holders of the Private Exchange Notes and, in the case of clause (iv) above,
the affected Holder, and shall file a Shelf Registration pursuant to Section 3
hereof, PROVIDED, HOWEVER, that in the case of clause (iii) above such Holders
shall pay all reasonable registration expenses of the Note Issuers as described
in Section 6 hereof in connection with such Shelf Registration.
3. SHELF REGISTRATION
If a Shelf Notice is delivered as contemplated by Section 2(c)
hereof, then:
(a) SHELF REGISTRATION. The Note Issuers shall as promptly as
reasonably practicable file with the SEC a Registration Statement for an
offering to be made on a continuous basis pursuant to Rule 415 covering all of
the Registrable Notes (the "Shelf Registration"). If the Note Issuers shall
not have yet filed an Exchange Registration Statement, each of the Note Issuers
shall use its best efforts to file with the SEC the Shelf Registration on or
prior to the Filing Date. The Shelf Registration shall be on Form S-1 or
another appropriate form permitting registration of such Registrable Notes for
resale by Holders in the manner or manners designated by them (including,
without limitation, one or more underwritten offerings). The Note Issuers
shall not permit any securities other than the Registrable Notes to be included
in the Shelf Registration.
Each of the Note Issuers shall use its best efforts to cause the
Shelf Registration to be declared effective under the Securities Act by the
135th day after the Closing Date and to keep the Shelf Registration
continuously effective under the Securities Act until the date which is two
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years from the Issue Date (or one year from the initial effective date of the
Shelf Registration Statement in the case of a Shelf Notice given pursuant to a
request under Section 2(c)(iii)), subject to extension pursuant to the last
paragraph of Section 5 hereof, or such shorter period ending when all
Registrable Notes covered by the Shelf Registration have been sold in the
manner set forth and as contemplated in the Shelf Registration or when the
Notes become eligible for registration without volume restrictions, pursuant to
Rule 144 under the Securities Act (the "Effectiveness Period").
(b) WITHDRAWAL OF STOP ORDERS. If the Shelf Registration ceases to
be effective for any reason at any time during the Effectiveness Period (other
than because of the sale of all of the securities registered thereunder), each
of the Note Issuers shall use its best efforts to obtain the prompt withdrawal
of any order suspending the effectiveness thereof.
(c) SUPPLEMENTS AND AMENDMENTS. The Note Issuers shall promptly
supplement and amend the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration, if required by the Securities Act, or if reasonably
requested for such purpose by the Holders of a majority in aggregate principal
amount of the Registrable Notes covered by such Registration Statement or by
any underwriter of such Registrable Notes.
4. ADDITIONAL INTEREST
(a) The Note Issuers and the Initial Purchaser agree that the
Holders of Registrable Notes will suffer damages if the Note Issuers fail to
fulfill their obligations under Section 2 or Section 3 hereof and that it would
not be feasible to ascertain the extent of such damages with precision.
Accordingly, the Note Issuers agree to pay, as liquidated damages and as the
sole and exclusive remedy therefor, additional interest on the Notes
("Additional Interest") under the circumstances and to the extent set forth
below:
(i) if the Exchange Registration Statement or Shelf Registration
Statement is not filed within 75 days following the Issue Date, Additional
Interest shall accrue on the Notes over and above the stated interest at a
rate of 0.50% per annum for the first 30 days commencing on the 76th day
after the Issue Date or the Shelf Notice, respectively, such Additional
Interest rate increasing by an additional 0.50% per annum at the beginning
of each subsequent 30-day period;
(ii) if the Exchange Registration Statement or Shelf
Registration Statement is not declared effective within 135 days following
the Issue Date, Additional Interest shall accrue on the Notes over and
above the stated interest at a rate of 0.50% per annum for the first 30
days commencing on the 136th day after the Issue Date or the Shelf Notice,
respectively, such Additional Interest rate increasing by an additional
0.50% per annum at the beginning of each subsequent 30-day period; or
(iii) if (A) the Note Issuers have not exchanged all Notes
validly tendered in accordance with the terms of the Exchange Offer on or
prior to 165 days after the Issue
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Date or (B) the Exchange Registration Statement ceases to be effective
at any time prior to the time that the Exchange Offer is consummated or
(C) if applicable, the Shelf Registration Statement has been declared
effective and such Shelf Registration Statement ceases to be effective
at any time prior to the second anniversary of the Issue Date (unless
all the Notes have been sold thereunder), then Additional Interest shall
accrue on the Notes over and above the stated interest at a rate of
0.50% per annum for the first 30 days commencing on (x) the 166th day
after the Issue Date with respect to the Notes validly tendered and not
exchanged by the Note Issuers, in the case of (A) above, or (y) the day
the Exchange Registration Statement ceases to be effective or usable for
its intended purpose in the case of (B) above, or (z) the day such Shelf
Registration Statement ceases to be effective in the case of (C) above,
such Additional Interest rate increasing by an additional 0.50% per
annum at the beginning of each subsequent 30-day period;
PROVIDED, HOWEVER, that the Additional Interest rate on the Notes under clauses
(i), (ii) or (iii) above, may not exceed, in the aggregate, 1.50% per annum;
and PROVIDED FURTHER, that (1) upon the filing of the Exchange Registration
Statement or Shelf Registration Statement (in the case of clause (i) above),
(2) upon the effectiveness of the Exchange Registration Statement or Shelf
Registration Statement (in the case of (ii) above), or (3) upon the exchange of
Exchange Notes for all Notes tendered (in the case of clause (iii)(A) above),
or upon the effectiveness of the Exchange Registration Statement which had
ceased to remain effective (in the case of clause (iii)(B) above), or upon the
effectiveness of the Shelf Registration Statement which had ceased to remain
effective (in the case of clause (iii)(C) above), Additional Interest on the
Notes as a result of such clause (or the relevant subclause thereof), as the
case may be, shall cease to accrue.
(b) The Note Issuers shall notify the Trustee within one business
day after each and every date on which an event occurs in respect of which
Additional Interest is required to be paid (an "Event Date"). The Note Issuers
shall pay the Additional Interest due on the transfer restricted Notes by
depositing with the paying agent (which shall not be the Company for these pur
poses) for the transfer restricted Notes, in trust, for the benefit of the
holders thereof, prior to 11:00 A.M. on the next interest payment date
specified by the Indenture (or such other indenture), sums sufficient to pay
the Additional Interest then due. Any amounts of Additional Interest due
pursuant to clauses (a)(i), (a)(ii) or (a)(iii) of this Section 4 will be
payable to the Holders of affected Notes in cash semi-annually on each interest
payment date specified by the Indenture (or such other indenture) to the record
holders entitled to receive the interest payment to be made on such date,
commencing with the first such date occurring after any such Additional
Interest commences to accrue. The amount of Additional Interest will be
determined by multiplying the applicable Additional Interest rate by the
principal amount of the affected Registrable Notes of such Holders, multiplied
by a fraction, the numerator of which is the number of days such Additional
Interest rate was applicable during such period (determined on the basis of a
360-day year comprised of twelve 30-day months and, in the case of a partial
month, the actual number of days elapsed), and the denominator of which is 360.
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5. REGISTRATION PROCEDURES
In connection with the filing of any Registration Statement pursuant
to Sections 2 or 3 hereof, the Note Issuers shall effect such registration(s)
to permit the sale of the securities covered thereby in accordance with the
intended method or methods of disposition thereof, and pursuant thereto and in
connection with any Registration Statement filed by the Note Issuers hereunder,
each Note Issuer shall:
(a) Prepare and file with the SEC prior to the Filing Date a
Registration Statement or Registration Statements as prescribed by
Sections 2 or 3 hereof, and use its best efforts to cause each such
Registration Statement to become effective and remain effective as
provided herein; PROVIDED, HOWEVER, that if (1) such filing is pursuant to
Section 3 hereof, or (2) a Prospectus contained in an Exchange
Registration Statement filed pursuant to Section 2 hereof is required to
be delivered under the Securities Act by any Participating Broker Dealer
who seeks to sell Exchange Notes during the Applicable Period, before
filing any Registration Statement or Prospectus or any amendments or
supplements thereto, the Note Issuers shall, if requested in writing,
furnish to and afford the Holders of the Registrable Notes covered by such
Registration Statement or each such Participating Broker-Dealer, as the
case may be, their counsel and the managing underwriters, if any, a reason
able opportunity to review copies of all such documents (including copies
of any documents to be incorporated by reference therein and all exhibits
thereto) proposed to be filed (in each case at least three business days
prior to such filing). The Note Issuers shall not file any Registration
Statement or Prospectus or any amendments or supplements thereto in
respect of which the Holders must be afforded an opportunity to review
prior to the filing of such document under the immediately preceding
sentence, if the Holders of a majority in aggregate principal amount of
the Registrable Notes covered by such Registration Statement, or any such
Participating Broker-Dealer, as the case may be, their counsel, or the
managing underwriters, if any, shall object thereto in writing, which
writing shall set forth a reasonable basis for such objection.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Shelf Registration Statement or Exchange Registration
Statement, as the case may be, as may be necessary to keep such
Registration Statement continuously effective for the Effectiveness Period
or the Applicable Period or until consummation of the Exchange Offer, as
the case may be; cause the related Prospectus to be supplemented by any
Prospectus supplement required by applicable law, and as so supplemented
to be filed pursuant to Rule 424 (or any similar provisions then in force)
promulgated under the Securities Act; and comply with the provisions of
the Securities Act and the Exchange Act applicable to it with respect to
the disposition of all securities covered by such Registration Statement
as so amended or in such Prospectus as so supplemented and with respect to
the subsequent resale of any securities being sold by a Participating
Broker-Dealer covered by any such Prospectus; the Note Issuers shall be
deemed not to have used their best efforts to keep a Registration
Statement effective during the Applicable
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Period if either of them voluntarily takes any action that would result
in selling Holders of the Registrable Notes covered thereby or
Participating Broker-Dealers seeking to sell Exchange Notes not being
able to sell such Registrable Notes or such Exchange Notes during that
period unless such action is required by applicable law or unless the
Notes Issuers otherwise comply with this Agreement, including, without
limitation, the provisions of paragraph 5(k) hereof and the last
paragraph of this Section 5.
(c) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, notify the selling
Holders of Registrable Notes, or each such Participating Broker-Dealer, as
the case may be, their counsel and the managing underwriters, if any,
promptly (but in any event within two business days), and confirm such
notice in writing, (i) when a Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to a
Registration Statement or any post-effective amendment, when the same has
become effective under the Securities Act (including in such notice a
written statement that any Holder may, upon request, obtain, at the sole
expense of the Note Issuers, one conformed copy of such Registration
Statement or post-effective amendment including financial statements and
schedules, documents incorporated or deemed to be incorporated by
reference and exhibits), (ii) of the issuance by the SEC of any stop order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of any preliminary prospectus or the
initiation of any proceedings for that purpose, (iii) if at any time when
a Prospectus is required by the Securities Act to be delivered in connec
tion with sales of the Registrable Notes or resales of Exchange Notes by
Participating Broker-Dealers the representations and warranties of the
Note Issuers contained in any agreement (including any underwriting
agreement), contemplated by Section 5(m) hereof cease to be true and
correct, (iv) of the receipt by the Note Issuers of any notification with
respect to the suspension of the qualification or exemption from
qualification of a Registration Statement or any of the Registrable Notes
or the Exchange Notes to be sold by any Participating Broker-Dealer for
offer or sale in any jurisdiction, or the initiation or threatening of any
proceeding for such purpose, (v) of the happening of any event, the
existence of any condition or any information becoming known that makes
any statement made in such Registration Statement or related Prospectus or
any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of
any changes in or amendments or supplements to such Registration
Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
that in the case of the Prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, and (vi)
of the determination by the Note Issuers that a post-effective amendment
to a Registration Statement would be appropriate.
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(d) Use its best efforts to prevent the issuance of any order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending the
qualification (or exemption from qualification) of any of the Registrable
Notes or the Exchange Notes for sale in any jurisdiction, and, if any such
order is issued, to use its best efforts to obtain the withdrawal of any
such order at the earliest possible moment.
(e) If a Shelf Registration is filed pursuant to Section 3 hereof
and if requested by the managing underwriter or underwriters (if any), or
the Holders of a majority in aggregate principal amount of the Registrable
Notes being sold in connection with an underwritten offering, (i) promptly
incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriter or underwriters (if any), such
Holders, or counsel for any of them reasonably request to be included
therein, (ii) make all required filings of such prospectus supplement or
such post-effective amendment as soon as practicable after the Note
Issuers have received notification of the matters to be incorporated in
such prospectus supplement or post-effective amendment, and (iii) supple
ment or make amendments to such Registration Statement.
(f) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, furnish to each selling
Holder of Registrable Notes and to each such Participating Broker-Dealer
who so requests and to counsel and each managing underwriter, if any, at
the sole expense of the Note Issuers, one conformed copy of the
Registration Statement or Registration Statements and each post-effective
amendment thereto, including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be incorporated therein
by reference and all exhibits.
(g) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, deliver to each selling
Holder of Registrable Notes, or each such Participating Broker-Dealer, as
the case may be, their respective counsel, and the underwriters, if any,
at the sole expense of the Note Issuers, as many copies of the Prospectus
or Prospectuses (including each form of preliminary prospectus) and each
amendment or supplement thereto and any documents incorporated by
reference therein as such Persons may reasonably request; and, subject to
the last paragraph of this Section 5, each Note Issuer hereby consents to
the use of such Prospectus and each amendment or supplement thereto by
each of the selling Holders of Registrable Notes or each such
Participating Broker-Dealer, as the case may be, and the underwriters or
agents, if any, and dealers (if any), in connection with the offering and
sale of the Registrable Notes covered by, or the sale by Participating
Broker-Dealers of
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the Exchange Notes pursuant to, such Prospectus and any amendment or
supplement thereto.
(h) Prior to any public offering of Registrable Notes or any
delivery of a Prospectus contained in the Exchange Registration Statement
by any Participating Broker-Dealer who seeks to sell Exchange Notes during
the Applicable Period, to use its best efforts to register or qualify such
Registrable Notes (and to cooperate with selling Holders of Registrable
Notes or each such Participating Broker-Dealer, as the case may be, the
managing underwriter or underwriters, if any, and their respective counsel
in connection with the registration or qualification (or exemption from
such registration or qualification) of such Registrable Notes) for offer
and sale under the securities or Blue Sky laws of such jurisdictions
within the United States as any selling Holder, Participating Broker-
Dealer, or the managing underwriter or underwriters reasonably request in
writing; PROVIDED, HOWEVER, that where Exchange Notes held by
Participating Broker-Dealers or Registrable Notes' are offered other than
through an underwritten offering, the Note Issuers agree to cause their
counsel to perform Blue Sky investigations and file registrations and
qualifications required to be filed pursuant to this Section 5(h); keep
each such registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept
effective and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Exchange
Notes held by Participating Broker-Dealers or the Registrable Notes
covered by the applicable Registration Statement; PROVIDED, HOWEVER, that
none of the Note Issuers shall be required to (A) qualify generally to do
business in any jurisdiction where it is not then so qualified, (B) take
any action that would subject it to general service of process in any such
jurisdiction where it is not then so subject or (C) subject itself to
taxation in excess of a nominal dollar amount in any such jurisdiction
where it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Notes and the managing
underwriter or underwriters, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Notes to be sold,
which certificates shall not bear any restrictive legends and shall be in
a form eligible for deposit with The Depository Trust Company; and enable
such Registrable Notes to be in such denominations and registered in such
names as the managing underwriter or underwriters, if any, or Holders may
reasonably request.
(j) Use its best efforts to cause the Registrable Notes covered by
the Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the
Holders thereof or the underwriter or underwriters, if any, to dispose of
such Registrable Notes, except as may be required solely as a consequence
of the nature of a selling Holder's business, in which case each of the
Note Issuers will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such approvals.
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(k) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, upon the occurrence of
any event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as
promptly as practicable prepare and (subject to Section 5(a) hereof) file
with the SEC, at the sole expense of the Note Issuers, a supplement or
post-effective amendment to the Registration Statement or a supplement to
the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference, or file any other required document so
that, as thereafter delivered to the purchasers of the Registrable Notes
being sold thereunder or to the purchasers of the Exchange Notes to whom
such Prospectus will be delivered by a Participating Broker-Dealer, any
such Prospectus will not 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, in light of the circumstances under which
they were made, not misleading; provided, that this Section 5(k) shall not
be deemed to require the Note Issuers to disclose any information that, in
the good faith opinion of the management of the Note Issuers, is not yet
required to be disclosed and would not be in the best interests of the
Note Issuers to disclose, so long as the Note Issuers comply with all
applicable laws and government regulations and the last paragraph of this
Section 5.
(l) Prior to the effective date of the first Registration Statement
relating to the Registrable Notes, (i) provide the Trustee with
certificates for the Registrable Notes or Exchange Notes, as the case may
be, in a form eligible for deposit with The Depository Trust Company and
(ii) provide a CUSIP number for the Registrable Notes or Exchange Notes,
as the case may be.
(m) In connection with any underwritten offering initiated by the
Note Issuers of Registrable Notes pursuant to a Shelf Registration, enter
into an underwriting agreement as is customary in underwritten offerings
of debt securities similar to the Notes and take all such other actions as
are reasonably requested by the managing underwriter or underwriters in
order to facilitate the registration or the disposition of such
Registrable Notes and, in such connection, (i) make such representations
and warranties to, and covenants with, the underwriters with respect to
the business of the Note Issuers and their respective subsidiaries and the
Registration Statement, Prospectus and documents, if any, incorporated or
deemed to be incorporated by reference therein, in each case, as are
customarily made by Note Issuers to underwriters in underwritten offerings
of debt securities similar to the Notes, and confirm the same in writing
if and when requested; (ii) obtain the written opinion of counsel to the
Note Issuers and written updates thereof in form, scope and substance
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reasonably satisfactory to the managing underwriter or underwriters,
addressed to the underwriters covering the matters customarily covered in
opinions requested in underwritten offerings of debt similar to the Notes
and such other matters as may be reasonably requested by the managing
underwriter or underwriters; (iii) obtain "cold comfort" letters and
updates thereof in form, scope and substance reasonably satisfactory to
the managing underwriter or underwriters from the independent certified
public accountants of the Note Issuers (and, if necessary, any other
independent certified public accountants of any subsidiary of any of the
Note Issuers or of any business acquired by any of the Note Issuers for
which financial statements and financial data are, or are required to be,
included or incorporated by reference in the Registration Statement),
addressed to each of the underwriters, such letters to be in customary
form and covering matters of the type customarily covered in "cold
comfort" letters in connection with underwritten offerings of debt similar
to the Notes and such other matters as reasonably requested by the
managing underwriter or underwriters; and (iv) if an underwriting agree
ment is entered into, the same shall contain indemnification provisions
and procedures no less favorable than those set forth in Section 7 hereof
(or such other provisions and procedures acceptable to Holders of a
majority in aggregate principal amount of Registrable Notes covered by
such Registration Statement and the managing underwriter or underwriters
or agents) with respect to all parties to be indemnified pursuant to said
Section. The above shall be done at each closing under such underwriting
agreement, or as and to the extent required thereunder.
(n) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, make available for
inspection by any selling Holder of such Registrable Notes being sold, or
each such Participating Broker-Dealer, as the case may be, any underwriter
participating in any such disposition of Registrable Notes, if any, and
any attorney, accountant or other agent retained by any such selling
Holder or each such Participating Broker-Dealer, as the case may be, or
underwriter (collectively, the "Inspectors"), at the offices where
normally kept, during reasonable business hours, all financial and other
records, pertinent corporate documents and instruments of the Note Issuers
and their respective subsidiaries (collectively, the "Records") as shall
be reasonably necessary to enable them to exercise any applicable due
diligence responsibilities, and cause the officers, directors and
employees of the Note Issuers and their respective subsidiaries to make
available for inspection all information reasonably requested by any such
Inspector in connection with such Registration Statement. Records which
any of the Note Issuers determine, in good faith, to be confidential and
any Records which it notifies the Inspectors are confidential shall not be
disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in such
Registration Statement, (ii) the release of such Records is ordered
pursuant to a subpoena or other order from a court of competent
jurisdiction, (iii) disclosure of such information is, in the opinion of
counsel (a copy of which shall be delivered to the Note Issuers) for any
Inspector, necessary or advisable in connection with any action, claim,
suit or proceeding, directly or indirectly, involving or potentially
involving such Inspector and arising out of, based upon, relating to, or
involving this Agreement, or any transactions contemplated hereby or
arising hereunder, or (iv) the information in such Records has been made
generally available to the public. Each selling Holder of such
Registrable Securities and each such
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Participating Broker-Dealer will be required to agree that information
obtained by it as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of the Note Issuers unless and until such
information is generally available to the public. Each selling Holder
of such Registrable Notes and each such Participating Broker-Dealer will
be required to further agree that it will, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction, give
notice to the Note Issuers and allow the Note Issuers to undertake
appropriate action to prevent disclosure of the Records deemed
confidential at the Note Issuers' sole expense.
(o) Provide an indenture trustee for the Registrable Notes or the
Exchange Notes, as the case may be, and cause the Indenture or the trust
indenture provided for in Section 2(a) hereof, as the case may be, to be
qualified under the TIA not later than the effective date of the Exchange
Offer or the first Registration Statement relating to the Registrable
Notes; and in connection therewith, cooperate with the trustee under any
such indenture and the Holders of the Registrable Notes, to effect such
changes to such indenture as may be required for such indenture to be so
qualified in accordance with the terms of the TIA; and execute, and use
its best efforts to cause such 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 such indenture to be so
qualified in a timely manner.
(p) Comply with all applicable rules and regulations of the SEC and
make generally available to its securityholders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder (or any similar rule promulgated under the Securities Act)
no later than 45 days after the end of any 12-month period (or 90 days
after the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Notes are
sold to underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Note
Issuers after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(q) If an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Notes by Holders to the Note Issuers (or
to such other Person as directed by the Note Issuers) in exchange for the
Exchange Notes or the Private Exchange Notes, as the case may be, shall
xxxx, or cause to be marked, on such Registrable Notes that such
Registrable Notes are being cancelled in exchange for the Exchange Notes
or the Private Exchange Notes, as the case may be; in no event shall such
Registrable Notes be marked as paid or otherwise satisfied.
(r) Cooperate with each seller of Registrable Notes covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Notes and their respective counsel in
connection with any filings
-17-
required to be made with the National Association of Securities Dealers,
Inc. (the "NASD").
(s) Use its best efforts to take all other steps necessary or
advisable to effect the registration of the Registrable Notes covered by a
Registration Statement contemplated hereby.
The Note Issuers may require each seller of Registrable Notes as to
which any Registration Statement is being effected to furnish to the Note
Issuers such information regarding such seller and the distribution of such
Registrable Notes as the Note Issuers may, from time to time, reasonably
request. The Note Issuers may exclude from such Registration Statement the
Registrable Notes of any seller who unreasonably fails to furnish such
information within a reasonable time after receiving such request. Each seller
as to which any Shelf Registration is being effected agrees to furnish promptly
to the Note Issuers all information required to be disclosed in order to make
the information previously furnished to the Note Issuers by such seller not
materially misleading.
Each Holder of Registrable Notes and each Participating Broker-Dealer
agrees by acquisition of such Registrable Notes or Exchange Notes to be sold by
such Participating Broker-Dealer, as the case may be, that, upon actual receipt
of any notice from the Note Issuers of the happening of any event of the kind
described in Section 5(c)(ii), 5(c)(iv), 5(c)(v), or 5(c)(vi) hereof, such
Holder will forthwith discontinue disposition of such Registrable Notes or
Exchange Notes, as the case may be, covered by such Registration Statement or
Prospectus to be sold by such Holder or Participating Broker-Dealer, as the
case may be, until such Holder's or Participating Broker-Dealer's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
5(k) hereof, or until it is advised in writing (the "Advice") by the Note
Issuers that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto. In the event the
Note Issuers shall give any such notice, each of the Effectiveness Period and
the Applicable Period shall be extended by the number of days during such
periods from and including the date of the giving of such notice to and
including the date when each seller of Registrable Notes covered by such
Registration Statement or Exchange Notes to be sold by such Participating
Broker-Dealer, as the case may be, shall have received (x) the copies of the
supplemented or amended Prospectus contemplated by Section 5(k) hereof or (y)
the Advice. In the event the Note Issuers do not give any such notice within
five business days, each Holder shall return such Registration Statement or
Prospectus to the Note Issuers or destroy all copies of such Registration
Statement or Prospectus; and if so requested by the Note Issuers, shall certify
that all copies of the Registration Statement or Prospectus were destroyed.
6. REGISTRATION EXPENSES
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Note Issuers shall be borne by the Note
Issuers whether or not the Exchange Offer or a Shelf Registration is filed or
becomes effective, including, without
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limitation, (i) all registration and filing fees (including, without
limitation, (A) fees with respect to filings required to be made with
the SEC and the NASD in connection with an underwritten offering and (B)
fees and expenses of compliance with state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements of the
Note Issuers' counsel in connection with Blue Sky qualifications of the
Registrable Notes or Exchange Notes and determination of the eligibility
of the Registrable Notes or Exchange Notes for investment under the laws
of such jurisdictions (x) where the holders of Registrable Notes are
located, in the case of the Exchange Notes, or (y) as provided in
Section 5(h) hereof, in the case of Registrable Notes or Exchange Notes
to be sold by a Participating Broker-Dealer during the Applicable
Period)), (ii) printing expenses, including, without limitation,
expenses of printing certificates for Registrable Notes or Exchange
Notes in a form eligible for deposit with The Depository Trust Company
and of printing Prospectuses if the printing of Prospectuses is
requested by the managing underwriter or underwriters, if any, by the
Holders of a majority in aggregate principal amount of the Registrable
Notes included in any Registration Statement or sold by any
Participating Broker-Dealer, as the case may be, (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel
for the Note Issuers, (v) fees and disbursements of all independent
certified public accountants referred to in Section 5(m)(iii) hereof
(including, without limitation, the expenses of any special audit and
"cold comfort" letters required by or incident to such performance by or
incident to such performance), (vi) rating agency fees, if any, and any
fees associated with making the Registrable Notes or Exchange Notes
eligible for trading through The Depository Trust Company, (vii)
Securities Act liability insurance, if the Note Issuers desire such
insurance, (viii) fees and expenses of all other Persons retained by the
Note Issuers, (ix) internal expenses of the Note Issuers (including,
without limitation, all salaries and expenses of officers and employees
of the Note Issuers performing legal or accounting duties), (x) the
expense of any annual audit, (xi) the fees and expenses incurred in
connection with the listing of the securities to be registered on any
securities exchange or any interdealer quotation system, if applicable,
and (xii) the expenses relating to printing, word processing and
distributing all Registration Statements, underwriting agreements,
securities sales agreements, indentures and any other documents
necessary in order to comply with this Agreement.
(b) The Note Issuers, jointly and severally, shall reimburse the
Holders of the Registrable Notes being registered in a Shelf Registration for
the reasonable fees and disbursements of not more than one counsel chosen in
writing by the Holders of a majority in aggregate principal amount of the
Registrable Notes to be included in such Registration Statement. In addition,
the Note Issuers, jointly and severally, shall reimburse the Initial Purchaser
for 50% (but not more than $50,000) of the reasonable fees and expenses of one
counsel in connection with the Exchange Offer which shall be White & Case LLP,
and shall not be required to pay any other legal expenses of the Initial
Purchaser in connection therewith.
7. INDEMNIFICATION. (a) Each of the Note Issuers, jointly and
severally, agrees to indemnify and hold harmless each Holder of Registrable
Notes offered pursuant to a Shelf Registration Statement and each Participating
Broker-Dealer selling Exchange Notes during the Applicable Period, the
affiliates, directors, officers, agents, representatives and employees of each
such Person or its affiliates, and each other Person, if any, who controls any
-19-
such Person or its affiliates within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act (each, a "Participant") from
and against any and all losses, claims, damages and liabilities (including,
without limitation, the reasonable legal fees and other expenses actually
incurred in connection with any suit, action or proceeding or any claim
asserted) caused by, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement pursuant to which the offering of such Registrable Notes or Exchange
Notes, as the case may be, is registered (or any amendment thereto) or related
Prospectus (or any amendments or supplements thereto) or any related
preliminary prospectus, or caused by, arising out of or based upon any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; PROVIDED, HOWEVER,
that the Note Issuers will not be required to indemnify a Participant if (i)
such losses, claims, damages or liabilities are caused by any untrue statement
or omission or alleged untrue statement or omission made in reliance upon and
in conformity with information furnished to the Note Issuers in writing by or
on behalf of such Participant expressly for use therein or (ii) if such
Participant sold to the person asserting the claim the Registrable Notes or
Exchange Notes which are the subject of such claim and such untrue statement or
omission or alleged untrue statement or omission was contained or made in any
preliminary prospectus and corrected in the Prospectus or any amendment or
supplement thereto and the Prospectus does not contain any other untrue
statement or omission or alleged untrue statement or omission of a material
fact that was the subject matter of the related proceeding and such Participant
failed to deliver or provide a copy of the Prospectus (as amended or
supplemented) to such Person with or prior to the confirmation of the sale of
such Registrable Notes or Exchange Notes sold to such Person if required by
applicable laws, unless such failure to deliver or provide a copy of the
Prospectus (as amended or supplemented) was a result of noncompliance by the
Note Issuers with Section 5 of this Agreement.
(b) Each Participant agrees, severally and not jointly, to indemnify
and hold harmless the Note Issuers, their respective directors and officers and
each Person who controls the Note Issuers within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Note Issuers to each Participant, but only (i)
with reference to information furnished to the Note Issuers in writing by or on
behalf of such Participant expressly for use in any Registration Statement or
Prospectus, any amendment or supplement thereto, or any preliminary prospectus
or (ii) with respect to any untrue statement or representation made by such
Participant in writing to the Note Issuers.
(c) If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any Person in respect of which indemnity may be sought pursuant to either of
the two preceding paragraphs, such Person (the "Indemnified Person") shall
promptly notify the Person against whom such indemnity may be sought (the
"Indemnifying Person") in writing, and the Indemnifying Person, shall have the
right to retain counsel reasonably satisfactory to the Indemnified Person to
represent the Indemnified Person and any others the Indemnifying Person may
reasonably designate in such proceeding and shall pay the reasonable fees and
expenses actually incurred by such counsel
-20-
related to such proceeding; PROVIDED, HOWEVER, that the failure to so
notify the Indemnifying Person shall not relieve it of any obligation or
liability which it may have hereunder or otherwise (unless and only to
the extent that such failure results in the loss or compromise of any
material rights or defenses by the Indemnifying Person). In any such
proceeding, any Indemnified Person shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Person unless (i) the Indemnifying Person
and the Indemnified Person shall have mutually agreed in writing to the
contrary, (ii) the Indemnifying Person shall have failed within a
reasonable period of time to retain counsel reasonably satisfactory to
the Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person
and the Indemnified Person and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that, unless there exists a
conflict among Indemnified Persons, the Indemnifying Person shall not,
in connection with any one such proceeding or separate but substantially
similar related proceeding in the same jurisdiction arising out of the
same general allegations, be liable for the fees and expenses of more
than one separate firm (in addition to any local counsel) for all
Indemnified Persons, and that all such reasonable fees and expenses
shall be reimbursed promptly as they are incurred. Any such separate
firm for the Participants shall be designated in writing by Participants
who sold a majority in interest of Registrable Notes and Exchange Notes
sold by all such Participants and any such separate firm for the Note
Issuers, their directors, their officers and such control Persons of the
Note Issuers shall be designated in writing by the Note Issuers. The
Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its prior written consent, but if settled
with such consent or if there be a final nonappealable judgment for the
plaintiff for which the Indemnified Person is entitled to
indemnification pursuant to this Agreement, the Indemnifying Person
agrees to indemnify and hold harmless each Indemnified Person from and
against any loss or liability by reason of such settlement or judgment.
No Indemnifying Person shall, without the prior written consent of the
Indemnified Person, effect any settlement or compromise of any pending
or threatened proceeding in respect of which any Indemnified Person is
or could have been a party, and indemnity could have been sought
hereunder by such Indemnified Person, unless such settlement (A)
includes an unconditional written release of such Indemnified Person, in
form and substance reasonably satisfactory to such Indemnified Person,
from all liability on claims that are the subject matter of such
proceeding and (B) does not include any statement as to an admission of
fault, culpability or failure to act by or on behalf of any Indemnified
Person.
(d) If the indemnification provided for in Sections 7(a) and 7(b)
hereof is for any reason unavailable to, or insufficient to hold harmless, an
Indemnified Person in respect of any losses, claims, damages or liabilities
referred to therein, then each Indemnifying Person under such paragraphs, in
lieu of indemnifying such Indemnified Person thereunder and in order to provide
for just and equitable contribution, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims, damages
or liabilities in such proportion as is appropriate to reflect (i) the relative
benefits received by the Indemnifying Person or Persons on the one hand and the
Indemnified Person or Persons on the other from the offering of the Notes or
(ii) if the allocation provided by the foregoing clause (i) is not permitted
-21-
by applicable law, not only such relative benefits but also the relative
fault of the Indemnifying Person or Persons on the one hand and the
Indemnified Person or Persons on the other in connection with the
statements or omissions or alleged statements or omissions that resulted
in such losses, claims, damages or liabilities (or actions in respect
thereof). The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Note
Issuers on the one hand or such Participant or such other Indemnified
Person, as the case may be, on the other, the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission, and any other equitable considerations
appropriate in the circumstances.
(e) The parties agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by PRO RATA allocation
(even if the Participants were treated as one entity for such purposes) or by
any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Person as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
reasonable legal or other expenses actually incurred by such Indemnified Person
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall a
Participant be required to contribute any amount in excess of the amount by
which proceeds received by such Participant from sales of Registrable Notes or
Exchange Notes, as the case may be, exceeds the amount of any damages that such
Participant has otherwise been required to pay or has paid by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the Indemnifying Persons
may otherwise have to the Indemnified Persons referred to above.
8. RULES 144 AND 144A. The Note Issuers covenant that they will
file the reports required to be filed by them under the Securities Act and the
Exchange Act and the rules and regulations adopted by the SEC thereunder in a
timely manner in accordance with the requirements of the Securities Act and the
Exchange Act and, if at any time the Note Issuers are not required to file such
reports, they will, upon the request of any Holder of Registrable Notes, make
publicly available annual reports and such information, documents and other
reports of the type specified in Sections 13 and 15(d) of the Exchange Act.
The Note Issuers further covenant for so long as any Registrable Notes remain
outstanding, to make available to any Holder or beneficial owner of Registrable
Notes in connection with any sale thereof and any prospective purchaser of such
Registrable Notes from such Holder or beneficial owner the information required
by Rule 144(d)(4) under the Securities Act in order to permit resales of such
Registrable Notes pursuant to Rule 144A.
-22-
9. UNDERWRITTEN REGISTRATIONS. If any of the Registrable Notes
covered by any Shelf Registration are to be sold in an underwritten offering,
the investment banker or investment bankers and manager or managers that will
manage the offering will be selected by the Holders of a majority in aggregate
principal amount of such Registrable Notes included in such offering and
reasonably acceptable to the Note Issuers.
No Holder of Registrable Notes may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable 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.
10. MISCELLANEOUS. (a) NO INCONSISTENT AGREEMENTS. None of the
Note Issuers have entered, as of the date hereof, and none of the Note Issuers
shall, after the date of this Agreement, enter into any agreement with respect
to any of its securities that is inconsistent with the rights granted to the
Holders of Registrable Notes in this Agreement or otherwise conflicts with the
provisions hereof. None of the Note Issuers have entered and none of the Note
Issuers will enter into any agreement with respect to any of its securities
which will grant to any Person piggyback registration rights with respect to a
Registration Statement other than those piggyback registration rights granted
under the Registration Rights and Members' Agreement dated as of July 8, 1998
by and among Epic Resorts, LLC, Epic Capital Corp., Members of Epic Resorts,
LLC and NatWest Capital Markets Limited.
(b) ADJUSTMENTS AFFECTING REGISTRABLE NOTES. None of the Note
Issuers shall, directly or indirectly, take any action with respect to the
Registrable Notes as a class that would adversely affect the ability of the
Holders of Registrable Notes to include such Registrable Notes in a
registration undertaken pursuant to this Agreement.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, otherwise than with the prior
written consent of the Holders of not less than a majority in aggregate
principal amount of the then outstanding Registrable Notes. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of Holders of
Registrable Notes whose securities are being sold pursuant to a Registration
Statement and that does not directly or indirectly affect, impair, limit or
compromise the rights of other Holders of Registrable Notes may be given by
Holders of at least a majority in aggregate principal amount of the Registrable
Notes being sold by such Holders pursuant to such Registration Statement;
PROVIDED, HOWEVER, that the provisions of this sentence may not be amended,
modified or supplemented except in accordance with the provisions of the
immediately preceding sentence.
(d) NOTICES. All notices and other communications (including,
without limitation, any notices or other communications to the Trustee)
provided for or permitted
-23-
hereunder shall be made in writing by hand delivery, registered first
class mail, next day air courier or facsimile:
1. if to a Holder of the Registrable Notes or any Participating
Broker-Dealer, at the most current address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the records of the
registrar under the Indenture, with a copy in like manner to the Initial
Purchaser as follows:
NatWest Capital Markets Limited
000 Xxxxxxxxxxx
Xxxxxx, XX0X 0XX
Xxxxxx Xxxxxxx
Attention: N.S. Coulbeck
with a copy to:
White & Case LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Facsimile No: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
2. if to the Initial Purchaser, at the addresses specified in
Section 10(d)(1);
3. if to a Note Issuer, as follows:
Epic Resorts, LLC
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx xx Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
with a copy to:
Xxxxx, Day, Xxxxxx & Xxxxx
North Point
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; one business day
after being timely delivered to a next day air courier; and when receipt is
acknowledged by the addressee, if sent by facsimile.
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Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address and in the manner specified in such Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties hereto; PROVIDED, HOWEVER, that this Agreement shall not inure to the
benefit of or be binding upon a successor or assign of a Holder unless and to
the extent such successor or assign holds registrable Notes.
(f) 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.
(g) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning thereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW, EACH OF THE PARTIES HERETO AGREES TO
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(i) SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their best efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any
of such that may be hereafter declared invalid, illegal, void or unenforceable.
(j) NOTES HELD BY THE NOTE ISSUERS OR THEIR AFFILIATES. Whenever the
consent or approval of Holders of a specified percentage of Registrable Notes
is required hereunder, Registrable Notes held by the Note Issuers or their
affiliates (as such term is defined in Rule 405 under the Securities Act) shall
not be counted in determining whether such consent or approval was given by the
Holders of such required percentage.
(k) THIRD PARTY BENEFICIARIES. Holders of Registrable Notes and Par
ticipating Broker-Dealers are intended third party beneficiaries of this
Agreement and this Agreement may be enforced by such Persons.
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IN WITNESS WHEREOF, the parties have executed the Agreement as of the
date first written above.
EPIC RESORTS, LLC
By: EPIC MEMBERSHIP CORP., its
Managing Member
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
EPIC CAPITAL CORP.
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
DAYTONA BEACH REGENCY, LTD.
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
LONDON BRIDGE RESORT, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
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EPIC RESORTS-WESTPARK RESORT, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
EPIC RESORTS-SCOTTSDALE LINKS RESORT, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
EPIC RESORTS-PALM SPRINGS MARQUIS VILLAS, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
RESORT MANAGEMENT, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
RESORT INVESTMENT, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
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EPIC TRAVEL, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
EPIC RESORTS-HILTON HEAD, LLC
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written:
NATWEST CAPITAL MARKETS LIMITED
By: /s/ X. X. Xxxx
----------------------------
Name: X. X. Xxxx
Title: Director
-28-
ANNEX A
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Notes for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Notes received in
exchange for Notes where such Notes were acquired as a result of market-making
activities or other trading activities. The Company has agreed that, for a
period of 180 days after the Expiration Date, it will make this Prospectus, as
amended or supplemented, available to any broker-dealer for use in connection
with any such resale. In addition, until _______________, 199_, all dealers
effecting transactions in the Exchange Notes may be required to deliver a
prospectus.1
The Company will not receive any proceeds from any sale of Exchange
Notes by broker-dealers. Exchange Notes received by broker-dealers for their
own account pursuant to the Exchange Offer may be sold from time to time in one
or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Notes or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or at negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Notes. Any broker-dealer that resells Exchange Notes that were received by it
for its own account pursuant to the Exchange Offer and any broker or dealer
that participates in a distribution of such Exchange Notes may be deemed to be
an "underwriter" within the meaning of the Securities Act and any profit on any
such resale of Exchange Notes and any commission or concessions received by any
such persons may be deemed to be underwriting compensation under the Securities
Act. The Letter of Transmittal states that, by acknowledging that it will
deliver and by delivering a prospectus, a broker-dealer will not be deemed to
admit that it is an "underwriter" within the meaning of the Securities Act.
For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Notes) other than commissions or concessions of any broker-
dealers and will indemnify the Holders of the Notes (including any
broker-dealers) against certain liabilities, including liabilities under the
Notes Act.
---------------------
(1) In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Exchange Offer prospectus.
/ / CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS
OR SUPPLEMENTS THERETO.
Name:
----------------------------------------
Address:
----------------------------------------
----------------------------------------
If the undersigned is not a broker-dealer, the undersigned represents that it
is not engaged in, and does not intend to engage in, a distribution of Exchange
Notes. If the undersigned is a broker-dealer that will receive Exchange Notes
for its own account in exchange for Notes that were acquired as a result of
market-making activities or other trading activities, it acknowledges that it
will deliver a prospectus in connection with any resale of such Exchange Notes;
however, by so acknowledging and by delivering a prospectus, the undersigned
will not be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act.
TABLE OF CONTENTS
Page
-----
1. ..................................................Definitions 2
2. ...............................................Exchange Offer 5
3. ...........................................Shelf Registration 8
4. ..........................................Additional Interest 9
5. ......................................Registration Procedures 10
6. ........................................Registration Expenses 18
7. ..............................................Indemnification 19
8. ...........................................Rules 144 and 144A 21
9. ...................................Underwritten Registrations 22
10. ...............................................Miscellaneous 22
(a) .................................No Inconsistent Agreements 22
(b) ....................Adjustments Affecting Registrable Notes 22
(c) .....................................Amendments and Waivers 22
(d) ....................................................Notices 23
(e) .....................................Successors and Assigns 24
(f) ...............................................Counterparts 24
(g) ...................................................Headings 24
(h) ..............................................Governing Law 24
(i) ...............................................Severability 24
(j) .........Notes Held by the Note Issuers or their Affiliates 24
(k) ..................................Third Party Beneficiaries 25
