EXHIBIT 4.2
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REGISTRATION RIGHTS AGREEMENT
Dated as of July 24, 2000
by and among
MANDALAY RESORT GROUP
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.,
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED,
BANC OF AMERICA SECURITIES LLC,
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION,
DEUTSCHE BANK SECURITIES INC.,
COMMERZBANK CAPITAL MARKETS CORP.,
CREDIT SUISSE FIRST BOSTON CORPORATION,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SECURITIES, INC.
FLEETBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.,
and
▇▇ ▇▇▇▇▇ SECURITIES CORPORATION,
as Initial Purchasers
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "AGREEMENT") is made and entered into as
of July 24, 2000 by and among MANDALAY RESORT GROUP, a Nevada corporation (the
"COMPANY"),and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO. ("▇▇▇▇▇▇▇ ▇▇▇▇▇"), ▇▇▇▇▇▇▇ LYNCH, PIERCE,
▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED, BANC OF AMERICA SECURITIES LLC, ▇▇▇▇▇▇▇▇▇, LUFKIN &
▇▇▇▇▇▇▇▇ SECURITIES CORPORATION, DEUTSCHE BANK SECURITIES INC., COMMERZBANK
CAPITAL MARKETS CORP., CREDIT SUISSE FIRST BOSTON CORPORATION, ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ SECURITIES, INC., FLEETBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC. and ▇▇ ▇▇▇▇▇
SECURITIES CORPORATION, (collectively, the "INITIAL PURCHASERS").
This Agreement is made pursuant to the Purchase Agreement dated July
19, 2000 by and among the Company and the Initial Purchasers (the "PURCHASE
AGREEMENT") that provides for, among other things, the sale by the Company to
the Initial Purchasers of an aggregate of $500,000,000 principal amount of the
Company's 10 1/4% Senior Subordinated Notes due 2007 (the "NOTES"). In order to
induce the Initial Purchasers to enter into the Purchase Agreement, the Company
has agreed to provide to the Initial Purchasers and their direct and indirect
transferees the registration rights set forth in this Agreement. The execution
and delivery of this Agreement is a condition to the closing under the Purchase
Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. DEFINITIONS. As used in this Agreement, the following capitalized
defined terms shall have the following meanings:
"ADDITIONAL INTEREST" see Section 2(e) hereof.
"ADVICE" see the last paragraph Section 3 hereof.
"APPLICABLE PERIOD" see Section 3(s) hereof.
"BUSINESS DAY" shall mean a day that is not a Saturday, a Sunday, or a
day on which banking institutions in New York, New York are required to be
closed.
"CLOSING TIME" shall mean the Closing Time as defined in the Purchase
Agreement.
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"COMPANY" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
"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.
"EFFECTIVENESS PERIOD" see Section 2(b) hereof.
"EFFECTIVENESS TARGET DATE" see Section 2(e) hereof.
"EVENT DATE" see Section 2(e) hereof.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"EXCHANGE OFFER" shall mean the exchange offer by the Company of
Exchange Notes for Notes pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall mean an exchange offer
registration statement on Form ▇-▇, ▇-▇ or S-4 (or, if applicable, on another
appropriate form), and all amendments and supplements to such registration
statement, in each case including the Prospectus contained therein, all exhibits
thereto and all material incorporated by reference therein.
"EXCHANGE PERIOD" see Section 2(a) hereof.
"EXCHANGE NOTES" shall mean the 10 1/4% Senior Subordinated Notes due
2007, issued by the Company under the Indenture containing terms identical to
the Notes (except that (i) interest thereon shall accrue from the last date on
which interest was paid on the Notes or, if no such interest has been paid, from
the Issue Date, (ii) the transfer restrictions with respect to the Notes and all
registration rights in respect thereof shall be eliminated and (iii) the
provisions relating to Additional Interest to be offered to Holders of Notes in
exchange for Notes pursuant to the Exchange Offer shall be eliminated).
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"HOLDERS" shall mean the Initial Purchasers, for so long as they own
any Transfer Restricted Notes, each of their direct and indirect successors,
assigns and 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 Securities Act in
connection with any resale of such Exchange Notes.
"INDENTURE" shall mean the Indenture relating to the Notes dated as of
July 24, 2000 between the Company and The Bank of New York, as trustee, as the
same may be amended from time to time in accordance with the terms thereof.
"INITIAL PURCHASERS" shall have the meaning set forth in the preamble
to this Agreement.
"INSPECTORS" see Section 3(m) hereof.
"ISSUE DATE" shall mean the date on which the Notes are originally
issued.
"MAJORITY HOLDERS" shall mean the Holders of a majority of the
aggregate principal amount of outstanding Transfer Restricted Notes.
"▇▇▇▇▇▇▇ ▇▇▇▇▇" shall have the meaning set forth in the preamble to
this Agreement.
"NOTES" shall have the meaning set forth in the preamble of this
Agreement.
"PARTICIPATING BROKER-DEALER" shall have the meaning set forth in
Section 3(s) hereof.
"PERSON" shall mean an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
"PRIVATE EXCHANGE" see Section 2(a) hereof.
"PRIVATE EXCHANGE NOTES" see Section 2(a) hereof.
"PROSPECTUS" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by
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any prospectus supplement, including a 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
to this Agreement.
"RECORDS" see Section 3(m) hereof.
"REGISTRATION EXPENSES" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all applicable SEC, stock exchange or National
Association of Securities Dealers, Inc. (the "NASD") registration and filing
fees, (ii) all fees and expenses incurred in connection with compliance with
state securities or blue sky laws (including reasonable fees and disbursements
of one counsel for Holders that are Initial Purchasers in connection with blue
sky qualification of any of the Exchange Notes or Transfer Restricted Notes) and
compliance with the rules of the NASD, (iii) all applicable expenses incurred by
the Company in preparing or assisting in preparing, word processing, printing
and distributing any Registration Statement, any Prospectus and any amendments
or supplements thereto, and in preparing or assisting in preparing any other
documents relating to the performance of and compliance with this Agreement,
(iv) all rating agency fees, if any, (v) the fees and disbursements of counsel
for the Company, (vii) 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, if the Company, in its discretion, elects to make any
such listing; but excluding fees of counsel to the Holders and underwriting
discounts and commissions and transfer taxes, if any, relating to the sale or
disposition of Transfer Restricted Notes by a Holder.
"REGISTRATION STATEMENT" shall mean any registration statement
(including, without limitation, the Exchange Offer Registration Statement and
the Shelf 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-
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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.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SHELF REGISTRATION" shall mean a registration effected pursuant to
Section 2(b) hereof.
"SHELF REGISTRATION EVENT DATE" see Section 2(b).
"SHELF REGISTRATION STATEMENT" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2(b) hereof that
covers all of the Transfer Restricted Notes or all of the Private Exchange
Notes, as the case may be, on an appropriate form under Rule 415 under the
Securities 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.
"TARGET CONSUMMATION DATE" see Section 2(a).
"TARGET EFFECTIVENESS DATE" see Section 2(a).
"TIA" shall have the meaning set forth in Section 3(k) hereof.
"TRANSFER RESTRICTED NOTES" means each Note until (i) the date on
which such has been exchanged by a person other than a broker-dealer for an
Exchange Note in the Exchange Offer, (ii) following the exchange by a
broker-dealer in the Exchange Offer of a Note for an Exchange Note, the date on
which such Exchange Note is sold to a purchaser who receives from such
broker-dealer on or prior to the date of such sale a copy of the prospectus
contained in the Exchange Offer Registration Statement, (iii) the date on which
such Note has been effectively registered under the Securities Act and disposed
of in accordance with the Shelf Registration Statement, (iv) the date on which
such Note is distributed to the public pursuant to Rule 144(k) under the
Securities Act (or any
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similar provision then in force, but not Rule 144A under the Securities Act),
(v) such Note shall have been otherwise transferred by the holder thereof and a
new Note not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent disposition of such Note shall not
require registration or qualification under the Securities Act or any similar
state law then in force or (vi) such Note ceases to be outstanding.
"TRUSTEE" shall mean the trustee with respect to the Notes under the
Indenture.
2. REGISTRATION UNDER THE SECURITIES ACT.
(a) EXCHANGE OFFER. The Company shall, for the benefit of the
Holders, at the Company's cost, (i) unless the Exchange Offer would not be
permitted by applicable law or SEC policy, file with the SEC within 30 days
after the Closing Time an Exchange Offer Registration Statement on an
appropriate form under the Securities Act covering the offer by the Company
to the Holders to exchange all of the Transfer Restricted Notes (other than
Private Exchange Notes (as defined below)) for a like principal amount of
Exchange Notes, (ii) unless the Exchange Offer would not be permitted by
applicable law or SEC policy, use its best efforts to have such Exchange
Offer Registration Statement declared effective under the Securities Act by
the SEC not later than 120 days after the Closing Time (the "TARGET
EFFECTIVENESS DATE"), (iii) have such Registration Statement remain
effective until the closing of the Exchange Offer and (iv) unless the
Exchange Offer would not be permitted by applicable law or SEC policy,
commence the Exchange Offer and use its best efforts to issue, on or prior
to the 150th day after the Closing Time (the "TARGET CONSUMMATION Date"),
Exchange Notes in exchange for all Notes tendered prior thereto in the
Exchange Offer. Upon the effectiveness of the Exchange Offer Registration
Statement, the Company shall promptly commence the Exchange Offer, it being
the objective of such Exchange Offer to enable each Holder eligible and
electing to participate in the Exchange Offer to exchange Transfer
Restricted Notes for Exchange Notes (assuming that such Holder is not an
affiliate of the Company within the meaning of Rule 405 under the
Securities Act and is not a broker-dealer tendering Transfer Restricted
Notes acquired directly from the Company for its own account, acquires the
Exchange Notes in the ordinary course of such Holder's business and has no
arrangements or understandings with any Person to participate in the
Exchange Offer for the purpose of distributing (within the meaning of the
Securities Act) the Exchange Notes) and to transfer
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such Exchange Notes from and after their receipt without any limitations or
restrictions under the Securities Act and under state securities or blue
sky laws.
In connection with the Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for a period of not
less than 20 Business Days after the date notice thereof is mailed to the
Holders (or longer if required by applicable law) (such period referred to
herein as the "EXCHANGE PERIOD");
(iii) utilize the services of the Depositary for the Exchange Offer;
(iv) permit Holders to withdraw tendered Notes at any time prior to
the close of business, New York 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 Notes delivered for exchange, and a
statement that such Holder is withdrawing his election to have such Notes
exchanged; and
(v) otherwise comply in all material 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 not having been sold in the
initial distribution, the Company 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").
The Exchange Notes and the Private Exchange Notes shall be issued
under (i) the Indenture or (ii) an indenture identical to all material respects
to the Indenture and that,
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in either case, has been qualified under 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. The Indenture or such
indenture shall provide that the Exchange Notes, the Private Exchange Notes and
the Notes shall vote and consent together on all matters 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. The Private
Exchange Notes shall be of the same series as 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 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.
The Exchange Offer and the Private Exchange shall not be subject to
any conditions, other than that (i) the Exchange Offer or Private Exchange, as
the case may be, does not violate applicable law or any applicable
interpretation of the staff of the SEC, (ii) no action or proceeding shall have
been instituted or threatened in any court or by any governmental agency that
might materially impair the ability of the Company to proceed with the Exchange
Offer or the Private Exchange, and no material adverse development shall have
occurred in any existing action or proceeding with respect to the Company and
(iii) all governmental approvals shall have been obtained, which approvals the
Company deems necessary for the consummation of the Exchange Offer or Private
Exchange. As soon as practicable after the close of the Exchange Offer and/or
the Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all Transfer Restricted Notes or portions
thereof properly 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 that is an exhibit
thereto;
(ii) accept for exchange all Notes properly tendered pursuant to the
Private Exchange; and
(iii) deliver, or cause to be delivered, to the Trustee for
cancellation all Transfer Restricted Notes or portions thereof so accepted
for exchange by the Company, and issue, and cause the Trustee under the
Indenture to promptly authenticate and deliver to each Holder, a new
Exchange Note or Private Exchange Note, as the case may
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be, equal in principal amount to the principal amount of the Transfer
Restricted Notes surrendered by such Holder and accepted for exchange.
To the extent not prohibited by any law or applicable interpretation
of the staff of the SEC, the Company shall use its best efforts to complete the
Exchange Offer as provided above and shall comply with the applicable
requirements of the Securities Act, the Exchange Act and other applicable laws
in connection with the Exchange Offer. Each Holder of Transfer Restricted Notes
who wishes to exchange such Transfer Restricted Notes for Exchange Notes in the
Exchange Offer will be required to make certain customary representations in
connection therewith, including representations that such Holder is not an
affiliate of the Company within the meaning of Rule 405 under the Securities
Act, that any Exchange Notes to be received by it will be acquired in the
ordinary course of business and that at the time of the commencement of the
Exchange Offer it has no arrangement with any Person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Notes.
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 to contact such Holders and otherwise facilitate the tender of
Transfer Restricted Notes in the Exchange Offer.
Upon consummation of the Exchange Offer in accordance with this
Section 2(a), the provisions of this Agreement shall continue to apply, MUTATIS
MUTANDIS, solely with respect to Transfer Restricted Notes that are Private
Exchange Notes and Exchange Notes held by Participating Broker-Dealers, and the
Company shall have no further obligation to register Transfer Restricted Notes
(other than Private Exchange Notes) pursuant to Section 2(b) hereof.
(b) SHELF REGISTRATION. If (i) the Company 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 policy,
(ii) the Exchange Offer is not for any other reason consummated by the Target
Consummation Date, (iii) any holder of Notes notifies the Company that (a) due
to a change in law or policy, in the opinion of counsel, it is not entitled to
participate in the Exchange Offer, (b) due to a change in law or policy, in the
opinion of counsel, it may not resell the Exchange Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and (x) the
prospectus contained in the Exchange Offer Registration Statement is not
appropriate or
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available for such resales by such holder and (y) such prospectus is not
promptly amended or modified in order to be suitable for use in connection
with such resales for such holder and all similarly situated holders or (c)
it is a broker-dealer and owns Notes acquired directly from the Company or an
affiliate of the Company, (iv) the holders of a majority of the Notes may not
resell the Exchange Notes acquired by them in the Exchange Offer to the
public without restriction under the Securities Act and without restriction
under applicable blue sky or state securities laws or (v) the Exchange Offer
shall not have been consummated within 150 days after the Issue Date (the
date of any of (i)-(v), the "SHELF REGISTRATION EVENT DATE"), then the
Company shall, at its cost, use its best efforts to cause to be filed a Shelf
Registration Statement prior to the later of (A) 30 days after the Shelf
Registration Event Date and (B) 150 days after the Issue Date and use its
best efforts to cause the Shelf Registration Statement to be declared
effective by the SEC on or prior to 90 days after the filing of the Shelf
Registration Statement. Each Holder as to which any Shelf Registration is
being effected agrees to furnish to the Company all information with respect
to such Holder necessary to make any information previously furnished to the
Company by such Holder not materially misleading.
The Company agrees to use its best efforts to keep the Shelf
Registration Statement continuously effective for a period of two years from the
Issue Date (subject to extension pursuant to the last paragraph of Section 3
hereof) (or such shorter period that will terminate when all of the Transfer
Restricted Notes covered by such Shelf Registration Statement have been sold
pursuant thereto or cease to be outstanding) (the "EFFECTIVENESS PERIOD");
PROVIDED, HOWEVER, that the Effectiveness Period in respect of the Shelf
Registration Statement shall be extended to the extent required to permit
dealers to comply with the applicable prospectus delivery requirements of Rule
174 under the Securities Act and as otherwise provided herein. The Company shall
not permit any securities other than Transfer Restricted Notes to be included in
the Shelf Registration. The Company further agrees, if necessary, to supplement
or amend the Shelf Registration Statement, if required by the rules, regulations
or instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registrations, and the Company agrees 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.
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(c) EXPENSES. The Company shall pay all Registration Expenses in
connection with the registration pursuant to Section 2(a) or 2(b) hereof and the
reasonable fees and expenses of one counsel, if any, designated in writing by
the Majority Holders to act as counsel for the Holders of the Transfer
Restricted Notes in connection with a Shelf Registration Statement. Except as
provided in the preceding sentence, each Holder shall pay all expenses of its
own counsel, 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.
(d) EFFECTIVE REGISTRATION STATEMENT. An Exchange Offer Registration
Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement
pursuant to Section 2(b) 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 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 be deemed not to have been
effective during the period of such interference, until the offering of Transfer
Restricted Notes may legally resume. The Company will be deemed not to have used
its 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 it voluntarily takes any action that 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, unless such
action is required by applicable law and except as otherwise provided in the
second paragraph of Section 2(e) below.
(e) ADDITIONAL INTEREST. In the event that (i) the applicable
Registration Statement is not filed with the SEC on or prior to the date
specified herein for such filing, (ii) the applicable Registration Statement is
not declared effective on or prior to the date specified herein for such
effectiveness after such obligation arises (the "EFFECTIVENESS TARGET DATE"),
(iii) if the Exchange Offer is required to be consummated hereunder, the Company
fails to consummate the Exchange Offer within 30 Business Days of the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (iv) the applicable Registration Statement is filed and declared
effective during the period effectiveness is required by
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Section 2(e) and 3(a) but shall thereafter cease to be effective or usable
without being succeeded immediately by an additional Registration Statement
covering the Transfer Restricted Notes that has been filed and declared
effective (each such event referred to in clauses (i) through (iv), a
"REGISTRATION DEFAULT"), then the interest rate on the Transfer Restricted Notes
as to which such Registration Default relates will increase ("ADDITIONAL
INTEREST"), 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 in an amount equal to 0.25% per annum of the principal
amount of the Notes. The rate of additional Interest will increase by an
additional 0.25% per annum of the principal amount of the Notes for each
subsequent 90-day period (or portion thereof) while a Registration Default is
continuing until all Registration Defaults have been cured, up to a maximum
amount of 1.00% of the principal amount of the Notes. Additional Interest shall
be computed based on the actual number of days elapsed during which any such
Registration Defaults exists. Following the cure of a Registration Default, the
accrual of Additional Interest with respect to such Registration Default will
cease.
If the Company issues a notice that the Shelf Registration Statement
is unusable due to the pendency of an announcement of a material corporate
transaction, or such notice is required under applicable securities laws to be
issued by the Company, and the aggregate number of days in any consecutive
twelve-month period for which the Shelf Registration Statement shall not be
usable due to all such notices issued or required to be issued exceeds 60 days
in the aggregate, then the interest rate borne by the Notes will be increased by
0.25% per annum of the principal amount of the Notes for the first 90-day period
(or portion thereof) beginning on the 31st such date that such Shelf
Registration Statement ceases to be usable, which rate shall be increased by an
additional 0.25% per annum of the principal amount of the Notes at the beginning
of each subsequent 90-day period (or portion thereof), up to a maximum amount of
1.00% of the principal amount of the Notes. Upon the Shelf Registration
Statement once again becoming usable, the interest rate borne by the Notes will
be reduced to the original interest rate if the Company is otherwise in
compliance with this Agreement 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.
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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"). Additional Interest shall be
paid by depositing with the Trustee, in trust, for the benefit of the Holders of
Transfer Restricted Notes, on or before the applicable semi-annual interest
payment date, immediately available funds in sums sufficient to pay the
Additional Interest then due. The Additional Interest due shall be payable on
each interest payment date to the record Holder of Notes entitled to receive the
interest payment to be paid on such date as set forth in the Indenture. Each
obligation 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 with respect to the Registration Statements pursuant to Sections
2(a) and 2(b) hereof, the Company shall:
(a) prepare and file with the SEC a Registration Statement or
Registration Statements as prescribed by Sections 2(a) and 2(b) hereof
within the relevant time period specified in Section 2 hereof on the
appropriate form under the Securities Act, 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 and (iii) shall comply as to form in all material respects
with the requirements of the applicable form and include all financial
statements required by the SEC to be filed therewith; and use its best
efforts to cause such Registration Statement to become effective and remain
effective in accordance with Section 2 hereof. The Company shall not file
any Registration Statement or Prospectus or any amendments or supplements
thereto in respect of which the Holders must provide information for
inclusion therein without the Holders being afforded an opportunity to
review such documentation a reasonable time prior to the filing of such
document if the Majority Holders or such Participating Broker-Dealer, as
the case may be, their counsel or the managing underwriters, if any, shall
reasonably object;
(b) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep such
Registration Statement effective for the Effectiveness Period or the
Applicable Period, as the case may be; and cause each Prospec-
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tus 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 Securities Act, and comply with the provisions of
the Securities Act, the Exchange Act and the rules and regulations
promulgated thereunder applicable to it with respect to the disposition of
all securities covered by each Registration Statement during the
Effectiveness Period or the Applicable Period, as the case may be, in
accordance with the intended method or methods of distribution by the
selling Holders thereof described in this Agreement (including sales by any
Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder of
Transfer Restricted Notes, at least three Business Days prior to filing,
that a Shelf Registration Statement with respect to the Transfer Restricted
Notes is being filed and advising such Holder that the distribution of
Transfer Restricted Notes will be made in accordance with the method
selected by the Majority Holders; and (ii) furnish to each Holder of
Transfer Restricted Notes, without charge, as many copies of each
Prospectus, and any amendment or supplement thereto and such other
documents as such Holder may reasonably request, in order to facilitate the
disposition of the Transfer Restricted Notes; and (iii) subject to the last
paragraph of Section 3 hereof, 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 such Prospectus or any amendment or
supplement thereto subject to the limitations on the use thereof provided
in Sections 2(d) and 2(e);
(d) in the case of a Shelf Registration, use its best efforts to
register or qualify, as may be required by applicable law, the Transfer
Restricted Notes under all applicable state securities or "blue sky" laws
of such jurisdictions by the time the applicable Registration Statement is
declared effective by the SEC as any Holder of Transfer Restricted Notes
covered by a Registration Statement shall reasonably request in advance of
such date of effectiveness, and do any and all other acts and things that
may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in each such jurisdiction of such Transfer
Restricted Notes owned by such Holder; PROVIDED, HOWEVER, that the Company
shall not be required to (i) qualify as a foreign corporation or as a
-15-
broker or dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), (ii) file any
general consent to service of process or (iii) subject itself to taxation
in any such jurisdiction if it is not so subject;
(e) in the case of (1) a Shelf Registration or (2) Participating
Broker-Dealers who have notified the Company that they will be utilizing
the Prospectus contained in the Exchange Offer Registration Statement as
provided in Section 3(s) hereof, notify each Holder of Transfer Restricted
Notes, or such Participating Broker-Dealers, as the case may be, and their
counsel if known to the Company, if any, promptly and confirm such notice
in writing (i) when a Registration Statement has become effective and when
any post-effective amendments and supplements thereto become effective,
(ii) of any request by the SEC or any state securities authority for
amendments and supplements to a Registration Statement or 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) if
the Company receives any notification with respect to the suspension of the
qualification of the Transfer Restricted Notes or the Exchange Notes to be
sold by any Participating Broker-Dealer for offer or sale in any
jurisdiction or the initiation of any proceeding for such purpose, (v) of
the happening of any event or the failure of any event to occur or the
discovery of any facts or otherwise, during the period a Shelf Registration
Statement is effective that makes any statement made in such Registration
Statement or the related Prospectus untrue in any material respect or that
causes such Registration Statement or Prospectus to omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and (vi) of the
Company's reasonable determination that a post-effective amendment to the
Registration Statement would be appropriate;
(f) make every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement as soon as
practicable;
(g) in the case of a Shelf Registration, furnish to each Holder of
Transfer Restricted Notes, without charge,
-16-
at least one conformed copy of each Registration Statement relating to such
Shelf Registration and any post-effective amendment thereto (without
documents incorporated therein by reference or exhibits thereto, unless
requested);
(h) 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 not bearing any restrictive legends
representing Notes covered by such Shelf Registration to be sold and
relating to the subsequent transfer of such Notes; and cause 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 may reasonably request at least two Business Days prior to the
closing of any sale of Transfer Restricted Notes;
(i) in the case of a Shelf Registration or an Exchange Offer
Registration, upon the occurrence of any circumstance contemplated by
Section 3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v) or 3(e)(vi) hereof, use its
best efforts to prepare a supplement or post-effective amendment to a
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, such Prospectus will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and to notify each Holder to suspend use of the Prospectus as
promptly as practicable after the occurrence of such an event, and each
Holder hereby agrees to suspend use of the Prospectus until the Company has
amended or supplemented the Prospectus to correct such misstatement or
omission;
(j) obtain a CUSIP number for all Exchange Notes or Private Exchange
Notes, as the case may be, not later than the effective date of a
Registration Statement, and provide the Trustee with certificates for the
Exchange Notes or the Private Exchange Notes, as the case may be, in a form
eligible for deposit with the Depositary;
(k) cause the Indenture to be qualified under the Trust Indenture Act
of 1939, as amended (the "TIA"), in connection with the registration of the
Exchange Notes or Transfer Restricted Notes, as the case may be, cooperate
with the Trustee and the Holders to effect such changes to
-17-
the Indenture as may be required for the Indenture to be so qualified in
accordance with the terms of the TIA and execute, and use its 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;
(l) in the case of a Shelf Registration, enter into such agreements
(including underwriting agreements) and take all such other appropriate
actions as are reasonably requested in order to expedite or facilitate the
registration or the disposition of such Transfer Restricted Notes, and in
such connection, (i) make such representations and warranties to Holders of
such Transfer Restricted Notes with respect to the business of the Company
and its subsidiaries as then conducted 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 issuers to
underwriters in underwritten offerings, and confirm the same if and when
requested; (ii) obtain opinions of counsel to the Company and updates
thereof in form and substance reasonably satisfactory to the Holders of a
majority in principal amount of the Transfer Restricted Notes being sold,
addressed to each selling Holder covering the matters customarily covered
in opinions requested in underwritten offerings and such other matters as
may be reasonably requested by such Holders; (iii) obtain "cold comfort"
letters and updates thereof from the independent certified public
accountants of the Company (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 and
financial data are, or are required to be, included in the Registration
Statement), addressed to the selling Holders of Transfer Restricted Notes,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with
underwritten offerings and such other matters as reasonably requested by
such selling Holders; and (iv) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures no
less favorable than those set forth in Section 4 hereof (or such other
provisions and procedures acceptable to the Company and the Holders of a
majority in aggregate principal amount of Transfer Restricted Notes covered
by such Registration with respect to all parties to be indemnified pursuant
to said Section
-18-
including, without limitation, such selling Holders). The above shall be
done at each closing in respect of the sale of Transfer Restricted Notes,
or as and to the extent required thereunder;
(m) if (1) a Shelf Registration is filed pursuant to Section 2(b) or
(2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2(a) 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 each such person who would be an "underwriter" as a result of either (i)
the sale by such person of Notes covered by such Shelf Registration
Statement or (ii) the sale during the Applicable Period by a Participating
Broker-Dealer of Exchange Notes (provided that a Participating
Broker-Dealer shall not be deemed to be an underwriter solely as a result
of it being required to deliver a prospectus in connection with any resale
of Exchange Notes) and any attorney, accountant or other agent retained by
any such person (collectively, the "INSPECTORS"), at the offices where
normally kept, during reasonable business hours, all financial and other
records, pertinent corporate documents and properties of the Company and
its 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
Company and its subsidiaries to supply all information in each case
reasonably requested by any such Inspector in connection with such
Registration Statement. Records that the Company determines, in good faith,
to be confidential and any Records that 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 material
misstatement or omission in such Registration Statement during a period
with respect to which the Company has not given notice that the
Registration Statement is unusable, (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction or (iii) the information in such Records has been made
generally available to the public, and, in the instances referred to in
clauses (i) and (ii), the notice to the Company and related provisions
described in this Section 2(m) have been complied with. Each selling Holder
of such Transfer Restricted Notes and each such Participating Broker-Dealer
will be required to agree that information obtained by it as a result of
such inspections
-19-
shall be deemed confidential and shall not be used by it as the basis for
any market transactions in the securities of the Company unless and until
such is made generally available to the public. Each Selling Holder of such
Transfer Restricted Notes and each such Participating Broker-Dealer will be
required to further agree that it will, upon learning that disclosure of
such Records is necessary to avoid or correct a material misstatement or
omission under the circumstances described in clause (i) above, give notice
to the Company and allow the Company at its expense to correct the material
misstatement or omission. Each selling Holder of such Transfer Restricted
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 Company and allow
the Company at its expense to undertake appropriate action to prevent
disclosure of the Records deemed confidential;
(n) comply with all applicable rules and regulations of the SEC and
make generally available to its securityholders earning 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 60 days after the end of any 12-month period (or 135 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 Transfer Restricted
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
Company after the effective date of a Registration Statement, which
statements shall cover said 12-month periods;
(o) upon consummation of an Exchange Offer or a Private Exchange,
obtain an opinion of counsel to the Company addressed to the Trustee for
the benefit of all Holders of Transfer Restricted Notes participating in
the Exchange Offer or the Private Exchange, as the case may be, that (i)
the Company has duly authorized, executed and delivered the Exchange Notes
and Private Exchange Notes, as the case may be, and (ii) each of the
Exchange Notes or the Private Exchange Notes, as the case may be,
constitute a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its respective terms (in
each case, with customary exceptions);
-20-
(p) if an Exchange Offer or a Private Exchange is to be consummated,
upon proper delivery of the Transfer Restricted Notes by Holders to the
Company (or to such other Person as directed by the Company) in exchange
for the Exchange Notes or the Private Exchange Notes, as the case may be,
the Company shall ▇▇▇▇, or cause to be marked, on such Transfer Restricted
Notes and on the books of the Trustee, the Transfer Agent, the Registrar
and the Depositary delivered by such Holders that such Transfer Restricted
Notes are being canceled in exchange for the Exchange Notes or the Private
Exchange Notes, as the case may be; but in no event shall such Transfer
Restricted Notes be marked as paid or otherwise satisfied solely as a
result of being exchanged for Exchange Notes or Private Exchange Notes in
the Exchange Offer or the Private Exchange, as the case may be;
(q) cooperate with each seller of Transfer Restricted Notes covered
by any Registration Statement participating in the disposition of such
Transfer Restricted Notes and one counsel acting on behalf of all such
sellers in connection with the filings, if any, required to be made with
the NASD;
(r) use its best efforts to take all other steps necessary to effect
the registration of the Transfer Restricted Notes covered by a Registration
Statement contemplated hereby; and
(s) (A) 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 reasonably acceptable to
▇▇▇▇▇▇▇ ▇▇▇▇▇, as representative of the Initial Purchasers, 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 (a "PARTICIPATING BROKER-DEALER") that holds Transfer
Restricted Notes acquired for its own account as a result of market-making
activities or other trading activities and 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, in the reasonable judgment of ▇▇▇▇▇▇▇
▇▇▇▇▇, as representative of the Initial Purchasers, represent the
prevailing views of the staff of the SEC, including a
-21-
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 Securities 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, and any amendment or supplement thereto, as such
Participating Broker-Dealer may reasonably request; (iii) 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, (iv) use its best efforts to keep the Exchange Offer Registration
Statement effective and to amend and supplement the Prospectus contained
therein in order to permit such Prospectus to be lawfully delivered by all
Persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such Persons must comply with such
requirements in order to resell the Exchange Notes; PROVIDED, HOWEVER, that
such period shall not be required to exceed 90 days (or such longer period
if extended pursuant to the last sentence of Section 3 hereof) (the
"APPLICABLE PERIOD"), 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 Securities 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 making the
acknowledgment described in clause (x) and by delivering a Prospectus in
connection with the exchange of Transfer Restricted Notes, such
broker-dealer will not be
-22-
deemed to admit that it is an underwriter within the meaning of the
Securities Act; and
(B) in the case of any Exchange Offer Registration Statement, the
Company agrees to deliver, upon request, to the Trustee or to Participating
Broker-Dealers upon consummation of the Exchange Offer (i) an opinion of
counsel substantially in the form attached hereto as Exhibit A, and (ii) an
officers' certificate containing certifications substantially similar to
those set forth in Section 5(d) of the Purchase Agreement.
The Company may require each seller of Transfer Restricted Notes as to
which any registration is being effected to furnish to the Company such
information regarding such seller and the proposed distribution of such Transfer
Restricted Notes, as the Company may from time to time reasonably request in
writing. The Company may exclude from such registration the Transfer Restricted
Notes of any seller who fails to furnish such information within a reasonable
time (not to exceed 10 Business Days) after receiving such request and shall be
under no obligation to compensate any such seller for any lost income, interest
or other opportunity forgone, or any liability incurred, as a result of the
Company's decision to exclude such seller.
In the case of (1) a Shelf Registration Statement or (2) Participating
Broker-Dealers who have notified the Company that they will be utilizing the
Prospectus contained in the Exchange Offer Registration Statement as provided in
Section 3(s) hereof, that are seeking to sell Exchange Notes and are required to
deliver Prospectuses, each Holder agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v) or 3(e)(vi) 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(i) hereof or until
it is advised in writing (the "ADVICE") by the Company that the use of the
applicable Prospectus may be resumed, and, if so directed by the Company, such
Holder will deliver to the Company (at the Company's expense) 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 or
Exchange Notes, as the case may be, current at the time of receipt of such
notice. If the Company shall give any such notice to suspend the disposition of
Transfer Restricted Notes or Exchange
-23-
Notes, as the case may be, pursuant to a Registration Statement, the Company
shall use its best efforts to file and have declared effective (if an amendment)
as soon as practicable an amendment or supplement to the Registration Statement
or Prospectus and, in the case of an amendment, have such amendment declared
effective as soon as practicable and shall extend the period during which such
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days in the period from and including the date of the giving of
such notice to and including the date when the Company shall have made available
to the Holders (x) copies of the supplemented or amended Prospectus necessary to
resume such dispositions or (y) the Advice.
4. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify
and hold harmless each Initial Purchaser, each Holder, each Participating
Broker-Dealer, each underwriter who participates in an offering of Transfer
Restricted Notes, their respective affiliates, each Person, if any, who controls
any of such parties within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, joint or several, 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), covering
Transfer Restricted Notes or Exchange Notes, 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, joint or several, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any court or 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 Sections
-24-
4(c) and 4(d) below) any such settlement is effected with the prior written
consent of the Company; and
(iii) against any and all expenses whatsoever, as incurred (including
reasonable fees and disbursements of one counsel (in addition to any local
counsel) chosen by ▇▇▇▇▇▇▇ ▇▇▇▇▇, such Holder, such Participating
Broker-Dealer or any underwriter (except to the extent otherwise expressly
provided in Section 4(c) hereof)), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any court or 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) of this
Section 4(a);
PROVIDED, HOWEVER, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission (i) made in reliance upon and
in conformity with written information furnished in writing to the Company by or
on behalf of such Initial Purchaser, such Holder, such Participating
Broker-Dealer or any underwriter with respect to such Initial Purchaser, Holder,
Participating Broker-Dealer or underwriter, as the case may be, expressly for
use in the Registration Statement (or any amendment or supplement thereto) or
any Prospectus (or any amendment or supplement thereto) or (ii) contained in any
preliminary prospectus if such Initial Purchaser, such Holder, such
Participating Broker-Dealer or such underwriter failed to send or deliver a copy
of the Prospectus (in the form it was first provided to such parties for
confirmation of sales) to the Person asserting such losses, claims, damages or
liabilities on or prior to the delivery of written confirmation of any sale of
securities covered thereby to such Person in any case where the Company shall
have previously furnished copies thereof to such Initial Purchaser, such Holder,
such Participating Broker-Dealer or such underwriter, as the case may be, in
accordance with this Agreement, at or prior to the written confirmation of the
sale of such Notes to such Person and the untrue statement contained in or the
omission from the preliminary prospectus was corrected in the Final Prospectus
(or any amendment or supplement thereto). Any amounts advanced by the Company to
an indemnified party pursuant to this Section 4 as a result of such losses shall
be returned to the Company if it shall be finally determined by a court of
competent jurisdiction in a judgment not subject to
-25-
appeal or final review that such indemnified party was not entitled to
indemnification by the Company.
(b) Each Holder agrees, severally and not jointly, to indemnify and
hold harmless the Company, each Initial Purchaser, each underwriter who
participates in an offering of Transfer Restricted Notes and the other selling
Holders and each of their respective directors and each Person, if any, who
controls any of the Company, any Initial Purchaser, any underwriter or any other
selling Holder within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, against any and all loss, liability, claim, damage and expense
whatsoever 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 Registration Statement (or any
amendment or supplement thereto) or any Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such selling Holder with respect to
such Holder expressly for use in the Registration Statement (or any supplement
thereto), or any such Prospectus (or any amendment thereto); PROVIDED, HOWEVER,
that, in the case of the Shelf Registration Statement, 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 the Shelf
Registration Statement; PROVIDED, FURTHER, HOWEVER, that for purposes of Section
4(a)(iii), such counsel shall (subject to Section 4(c) hereof) be chosen by the
Company.
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so 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 that it
may have otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to Section 4(a) above, one counsel to all the
indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in the case of
parties indemnified pursuant to Section 4(b) above, counsel to all the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any 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.
Notwithstanding the forego-
-26-
ing, if it so elects within a reasonable time after receipt of such notice, an
indemnifying party, jointly with any other indemnifying parties receiving such
notice, may assume the defense of such action with counsel chosen by it and
approved by the indemnified parties defendant in such action (which approval
shall not be unreasonably withheld), unless such indemnified parties reasonably
object to such assumption on the ground that there may be legal defenses
available to them which are different from or in addition to those available to
such indemnifying party. If an indemnifying party assumes the defense of such
action, the indemnifying parties shall not be liable for any fees and expenses
of counsel for the indemnified parties incurred thereafter in connection with
such action. In no event shall the indemnifying parties be liable for 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 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 a full and unconditional release
of each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and the offer and sale of any Notes 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 at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for reasonable fees and
expenses of counsel pursuant to Section 4(a)(iii) above, then such indemnifying
party agrees that it shall be liable for any settlement of the nature
contemplated by Section 4(a)(ii) effected without its written consent if (i)
such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement. Notwithstanding the immediately preceding sentence,
if at any time
-27-
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
effected without its consent if such indemnifying party (i) reimburses the
indemnified party in accordance with such request to the extent it considers
such request to be reasonable and (ii) provides written notice to the
indemnified party which states the indemnifying party's basis for its belief
that any unpaid balance of such request is unreasonable, in each case prior to
the date of such settlement.
(e) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company, the Initial
Purchasers and the Holders, as applicable, shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
such indemnity agreement incurred by the Company, the Initial Purchasers and the
Holders; PROVIDED, HOWEVER, that 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 that was not guilty of such
fraudulent misrepresentation. As between the Company and the Initial Purchasers
and the Holders, such parties shall contribute to such aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by such
indemnity agreement in such proportion as shall be appropriate to reflect the
relative fault of the Company on the one hand and of the Holder of Transfer
Restricted Notes, the Participating Broker-Dealer or Initial Purchaser, as the
case may be, 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 on the one hand and the Holder of
Transfer Restricted Notes, the Participating Broker-Dealer or the Initial
Purchasers, as the case may be, on the other hand 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 Company, or by the Holder of Transfer
Restricted Notes, the Participating Broker-Dealer or the Initial Purchasers, as
the case may be, and the parties' relative intent, knowledge, access to
informa-
-28-
tion and opportunity to correct or prevent such statement or omission.
The Company and the Holders of the Transfer Restricted Notes 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 or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this Section 4.
For purposes of this Section 4, each affiliate of any Person, if any,
who controls a Holder of Transfer Restricted Notes, an Initial Purchaser or a
Participating Broker-Dealer within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as such other Person, and each director of the Company, each affiliate of the
Company, each executive officer of the Company who signed the Registration
Statement, and each Person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same rights to contribution as the Company.
5. MISCELLANEOUS.
(a) RULE 144 AND RULE 144A. The Company shall provide to each Holder
such reports as are required under Section 4.07 of the Indenture and, 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
Securities Act, (b) deliver such information to a prospective purchaser as is
necessary to permit sales pursuant to Rule 144A under the Securities Act and it
will take such further action as any Holder of Transfer Restricted Notes may
reasonably request, and (c) take such further action, if any, 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 Securities Act within the limitation of the exemptions provided by (i)
Rule 144 under the Securities Act, as such rule may be amended from time to
time, (ii) Rule 144A under the Securities 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 reasonable request of any Holder of Transfer Restricted Notes, the
Company will deliver to such Holder a written statement as to whether they have
complied with such requirements.
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(b) NO INCONSISTENT AGREEMENTS. The rights granted to the Holders
hereunder do not, and will not for the term of this Agreement in any way
conflict with and are not, and will not during the term of this Agreement be
inconsistent with the rights granted to the holders of the Company's other
issued and outstanding securities under any other agreements entered into by the
Company.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including 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, otherwise than with the prior written consent of the Company
and the Majority Holders; PROVIDED, HOWEVER, that no amendment, modification, or
supplement or waiver or consent to the departure with respect to the provisions
of Section 4 hereof shall be effective as against any Holder of Transfer
Restricted Notes or the Company unless consented to in writing by such Holder of
Transfer Restricted Notes or the Company, as the case may be.
(d) 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 (i) 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(d), which address initially is, with respect to the Initial
Purchasers, the address set forth in the Purchase Agreement; and (ii) if to the
Company, initially at the Company's address set forth in the Purchase Agreement
and thereafter at such other address, notice of which is given in accordance
with the provisions of this Section 5(d).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five 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, at the
address specified in the Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors, as
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signs and transferees of the Initial Purchasers, including, without limitation
and without the need for an express assignment, subsequent Holders; PROVIDED,
HOWEVER, 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 and such Person
shall be entitled to receive the benefits hereof.
(f) THIRD PARTY BENEFICIARY. Each of the Initial Purchasers and each
Holder shall be a third party beneficiary of the agreements made hereunder
between the Company, 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 or the
rights of Holders hereunder.
(g) 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.
(h) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ANY PROVISIONS RELATING TO CONFLICTS OF LAWS. Specified times of day refer to
New York City time.
(j) 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.
(k) NOTES HELD BY THE COMPANY OR ANY OF ITS AFFILIATES. Whenever the
consent or approval of Holders of a speci-
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fied percentage of Transfer Restricted Notes is required hereunder, Transfer
Restricted Notes held by the Company or any of 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.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
MANDALAY RESORT GROUP
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: President
Confirmed and accepted as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇▇▇▇, LUFKIN & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION
DEUTSCHE BANK SECURITIES INC.
COMMERZBANK CAPITAL MARKETS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SECURITIES, INC.
FLEETBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
▇▇ ▇▇▇▇▇ SECURITIES CORPORATION
as Representatives of the Initial Purchasers
By: ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
EXHIBIT A
FORM OF OPINION OF COUNSEL
1. Each of the Exchange Offer Registration Statement and the
Prospectus (other than the financial statements, notes and schedules thereto and
other financial and statistical information and supplemental schedules included
or referred to therein or omitted therefrom and the Form T-1, as to which such
counsel need express no opinion), complies as to form in all material respects
with the applicable requirements of the Securities Act and the applicable rules
and regulations promulgated under the Securities Act.
2. In the course of such counsel's review and discussion of the
contents of the Exchange Offer Registration Statement and the Prospectus with
certain officers and other representatives of the Company and representatives of
the independent certified public accountants of the Company, but without
independent check or verification or responsibility for the accuracy,
completeness or fairness of the statements contained therein, on the basis of
the foregoing (relying as to materiality to a large extent upon representations
and opinions of officers and other representatives of the Company), no facts
have come to such counsel's attention which cause such counsel to believe that
the Exchange Offer Registration Statement (other than the financial statements,
notes and schedules thereto and other financial and statistical information
contained or referred to therein and the Form T-1, as to which such counsel need
express no belief), at the time the Exchange Offer Registration Statement became
effective and at the time of the consummation of the Exchange Offer, contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements contained
therein not misleading, or that the Prospectus (other than the financial
statements, notes and schedules thereto and other financial and statistical
information contained or referred to therein, as to which such counsel need
express no belief) contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained therein, in the
light of the circumstances under which they were made, not misleading.