<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)*
CIRCUS CIRCUS ENTERPRISES, INC.
(Name of Issuer)
COMMON STOCK, $.01 2/3 PAR VALUE
(Title of Class of Securities)
172909 10 3
(CUSIP Number)
Michael S. Ensign with a copy to:
Vice Chairman and Mary Ellen Kanoff, Esq.
Chief Operating Officer Latham & Watkins
Circus Circus Enterprises, Inc. 633 West Fifth Street
2880 Las Vegas Blvd., South Suite 4000
Las Vegas, Nevada 89109 Los Angeles, California 90071
(702) 794-3806 (213) 485-1234
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 1, 1995
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [_].
Check the following box if a fee is being paid with the statement. [_] (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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SCHEDULE 13D
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CUSIP No. 172909 10 3 Page 2 of ___ Pages
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1 NAME OF PERSON
MICHAEL S. ENSIGN
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2 CHECK THE APPROPRIATE BOX IF (a) [_]
MEMBER OF A GROUP*
(b) [_]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES
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7 SOLE DISPOSITIVE POWER
NUMBER OF 6,501,933
SHARES ---------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY N/A
EACH ---------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON WITH 6,501,933
---------------------------------------------------------
10 SHARED DISPOSITIVE POWER
N/A
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
6,501,933
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES*
N/A
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.4%
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14 TYPE OF PERSON REPORTING*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT
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ITEM 1. SECURITY AND ISSUER.
This Amendment No. 1 amends and restates in its entirety the Schedule
13D previously filed by Michael S. Ensign on June 12, 1995 and relates to the
shares of Common Stock, $.01 2/3 par value per share (the "Shares"), of Circus
Circus Enterprises, Inc., a Nevada corporation (the "Issuer"). The principal
executive offices of the Issuer are located at 2880 Las Vegas Blvd., South, Las
Vegas, Nevada 89109.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This statement is being filed by Michael S. Ensign (the "Reporting
Person").
(b) The Reporting Person's business address is 2880 Las Vegas Blvd.,
South, Las Vegas, Nevada 89109.
(c) The present principal occupation of the Reporting Person is Vice
Chairman of the Board of Directors and Chief Operating Officer of the Issuer.
The Issuer is primarily engaged in the gaming business and its principal
executive offices are located at 2880 Las Vegas Blvd., South, Las Vegas, Nevada
89109.
(d) During the last five years, the Reporting Person has not been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the last five years, the Reporting Person has not been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a
judgement, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) The Reporting Person is a citizen of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Pursuant to the Agreement and Plan of Merger dated as of March 19,
1995 by and among the Issuer and M.S.E. Investments, Incorporated, Last Chance
Investments, Incorporated, Goldstrike Investments, Incorporated, Diamond Gold,
Inc., Gold Strike Aviation, Incorporated, Goldstrike Finance Company, Inc.,
Oasis Development Company, Inc., the Reporting Person, William A. Richardson,
David R. Belding, Peter A. Simon II and Robert J. Verchota, as amended (the
"Merger Agreement"), the Reporting Person agreed to transfer to certain
subsidiaries of the Issuer his indirect interests in (i) three operating and
licensed Nevada casinos, (ii) two gasoline service stations, holding restricted
gaming licenses, (iii) an Illinois-licensed riverboat gaming facility, and (iv)
various development properties located in Nevada, Indiana/Kentucky, and
Mississippi (collectively, the "Gold Strike Properties"). In return, the Issuer
agreed to issue 6,501,933 Shares, and distribute $4,795,193 in cash, to the
Reporting Person. After the parties to the Merger Agreement obtained the
requisite gaming and other governmental approvals and bank consents, the
transactions contemplated by the Merger Agreement were effected (the "Closing")
on June 1, 1995 (the "Closing Date"), resulting in, among other things, the
transfer by the Reporting Person of the Gold Strike Properties to certain
subsidiaries of the Issuer and the issuance and distribution by the Issuer of
6,501,933 Shares and $4,795,193 in cash to the Reporting Person.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Person acquired the 6,501,933 Shares for investment
purposes. Subject to compliance with the Standstill Agreement (as defined
below) and compliance with applicable law, and depending on general market and
economic conditions affecting the Issuer and the
Page 3 of ___ Pages
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Reporting Person's view of the prospects for the Issuer and other relevant
factors, the Reporting Person may purchase additional Shares or dispose of some
or all of his Shares from time to time in open market transactions, private
transactions or otherwise.
The Reporting Person intends to participate in the formulation,
determination and direction of basic business decisions and policies of the
Issuer by virtue of his membership on the Issuer's Board of Directors and his
service as an executive officer of the Issuer. For further discussion of (i)
the Merger Agreement which contains provisions relating to the Reporting
Person's membership on the Issuer's Board of Directors and (ii) the Employment
Agreement (as defined below) which contains provisions relating to the Reporting
Person's employment as an executive officer of the Issuer, see Item 6, below.
Except as set forth herein, the Reporting Person has no present plans
or proposals with respect to any material change in the Issuer's business or
corporate structure or which relate to or would result in:
(a) the acquisition by any person of additional securities of the
Issuer, or the disposition of securities of the Issuer;
(b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its
subsidiaries;
(c) a sale or transfer of a material amount of assets of the
Issuer or any of its subsidiaries;
(d) any change in the present board of directors or management of
the Issuer, including any plans or proposals to change the number or term
of directors or to fill any existing vacancies on the board;
(e) any material change in the present capitalization or dividend
policy of the Issuer;
(f) changes in the Issuer's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of the Issuer by any person;
(g) causing a class of securities of the Issuer to be delisted
from a national securities exchange or cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national securities
association;
(h) a class of equity securities of the Issuer becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934; or
(i) any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The 6,501,933 Shares beneficially owned by the Reporting Person
constitute approximately 6.4% of the total number of Shares outstanding as of
the open of business on the
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Closing Date, after giving effect to the issuance of 16,291,551 Shares on such
date in connection with the Closing.
(b) The Reporting Person has the sole power to vote or to direct the
vote, and to dispose or to direct the disposition of, the 6,501,933 Shares
beneficially owned by him.
(c) Except as set forth herein, the Reporting Person has not engaged
in any transaction during the past 60 days in any securities of the Issuer.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
As described in Item 3, the Merger Agreement sets forth the Reporting
Person's agreement to sell his interests in the Gold Strike Properties in return
for the issuance of 6,501,933 Shares, and the distribution of $4,795,193 in
cash, to the Reporting Person.
In connection with the transactions contemplated by the Merger
Agreement, the Issuer's Bylaws were amended to increase the number of Class III
Directors from two to three. Pursuant to the Merger Agreement, on the Closing
Date, the Reporting Person was elected by the Issuer's Board of Directors to
fill the Class III vacancy resulting from the foregoing amendment to the Bylaws
for the balance of the current term of such class. The Merger Agreement also
requires the Issuer, at the end of the current term of the Reporting Person, to
use its best efforts to cause the Reporting Person (or another individual
designated by the Reporting Person) to be nominated for election to a full term
when that class next stands for election in 1997.
In connection with the Closing, the Reporting Person also entered into
the following agreements with the Issuer which relate to the management and
securities of the Issuer: Employment Agreement, Standstill Agreement,
Registration Rights Agreement and Agreement Pursuant to Joint Venture Agreement.
Each of which is discussed below.
The Employment Agreement dated as of the Closing Date by and between
the Reporting Person and the Issuer requires, among other things, the Issuer to
employ the Reporting Person as Vice Chairman of the Board of Directors and Chief
Operating Officer for a term of three years subject to automatic renewal unless
the Reporting Person or the Issuer provides written notice to the contrary.
The Standstill Agreement dated as of the Closing Date by and among the
Issuer and the Reporting Person, William A. Richardson, David R. Belding, Peter
A. Simon II and Glenn W. Schaeffer (the "Standstill Agreement"), contains a
number of customary "standstill" restrictions, including limitations on the
number of Shares which the Reporting Person can beneficially own. Pursuant to
such restrictions, the Reporting Person has agreed, among other things and
except in certain circumstances, for a five year period beginning on the Closing
Date (i) not to acquire more than 9.9% of the outstanding equity securities of
the Issuer, (ii) not to engage in the solicitation of proxies and (iii) not to
make any acquisition proposal.
The Registration Rights Agreement dated as of the Closing Date by and
among the Issuer and the Reporting Person, William A. Richardson, David R.
Belding, Peter A. Simon II, Glenn W. Schaeffer, Gregg H. Solomon, Antonio C.
Alamo, Anthony Korfman, William Ensign and Robert J. Verchota provides the
Reporting Person with certain demand and piggyback registration rights with
respect to the Shares acquired by him pursuant to the Merger Agreement.
The Agreement Pursuant to Joint Venture Agreement dated as of the
Closing Date by and among the Issuer and the Reporting Person, Glenn W.
Schaeffer and William A. Richardson, requires, during a certain period of time,
the foregoing individuals to jointly and severally pay to the Issuer liquidated
damages upon the occurrence of certain events relating to (i) the management of
a joint venture which is currently managed by an affiliate of the Issuer and
(ii) such individuals' employment with the Issuer or such individuals'
beneficial ownership of the capital stock of the Issuer.
The description of the terms of the Merger Agreement, Employment
Agreement, Standstill Agreement, Registration Rights Agreement and Agreement
Pursuant to Joint Venture Agreement set forth herein does not purport to be a
Page 5 of ___ Pages
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complete statement of the parties' rights and obligations, and is qualified in
its entirety by reference to such agreements, which are set forth as Exhibits
99.1 to 99.6 hereto. Reference is made to such agreements for a complete
description of the terms and provisions thereof and the agreement of the parties
thereunder.
Except as set forth above, there are no other contracts, arrangements,
understandings or relationships (legal or otherwise) among persons named in Item
2 and between such persons and any person with respect to any securities of the
Issuer, including but not limited to transfer or voting of any of the securities
of the Issuer, finder's fees, joint ventures, loan or option arrangements, puts
or calls, guarantees or profits, division of profits of loss, or the giving or
withholding of proxies, or a pledge or otherwise subject to a contingency the
occurrence of which would give another person voting power or investment power
over the securities of the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
99.1 Agreement and Plan of Merger dated as of March 19, 1995 by and
among the Issuer and M.S.E. Investments, Incorporated, Last
Chance Investments, Incorporated, Goldstrike Investments,
Incorporated, Diamond Gold, Inc., Gold Strike Aviation,
Incorporated, Goldstrike Finance Company, Inc., Oasis
Development Company, Inc., the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Robert J.
Verchota.
99.2 First Amendment to the Agreement and Plan of Merger dated May
30, 1995 by and among the Issuer and M.S.E. Investments,
Incorporated, Last Chance Investments, Incorporated, Goldstrike
Investments, Incorporated, Diamond Gold, Inc., Gold Strike
Aviation, Incorporated, Goldstrike Finance Company, Inc., Oasis
Development Company, Inc., the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Robert J.
Verchota.
99.3 Employment Agreement dated as of the Closing Date by and between
the Reporting Person and the Issuer.
99.4 Standstill Agreement dated as of the Closing Date by and
among the Issuer and the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Glenn W.
Schaeffer.
99.5 Registration Rights Agreement dated as of the Closing Date by
and among the Issuer and the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II, Glenn W.
Schaeffer, Gregg H. Solomon, Antonio C. Alamo, Anthony Korfman,
William Ensign and Robert J. Verchota.
99.6 Agreement Pursuant to Joint Venture Agreement dated as of the
Closing Date by and among the Issuer and the Reporting Person,
Glenn W. Schaeffer and William A. Richardson.
Page 6 of ___Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: June 26, 1995
/s/ Michael S. Ensign
----------------------------------------
Michael S. Ensign
Page 7 of ___ Pages
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EXHIBIT LIST
99.1 Agreement and Plan of Merger dated as of March 19, 1995 by and
among the Issuer and M.S.E. Investments, Incorporated, Last
Chance Investments, Incorporated, Goldstrike Investments,
Incorporated, Diamond Gold, Inc., Gold Strike Aviation,
Incorporated, Goldstrike Finance Company, Inc., Oasis
Development Company, Inc., the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Robert J.
Verchota (incorporated by reference to Exhibit 10(ee) to the
Issuer's Annual Report on Form 10-K for the year ended January
31, 1995).
99.2 First Amendment to the Agreement and Plan of Merger dated May
30, 1995 by and among the Issuer and M.S.E. Investments,
Incorporated, Last Chance Investments, Incorporated, Goldstrike
Investments, Incorporated, Diamond Gold, Inc., Gold Strike
Aviation, Incorporated, Goldstrike Finance Company, Inc., Oasis
Development Company, Inc., the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Robert J.
Verchota.
99.3 Employment Agreement dated as of the Closing Date by and between
the Reporting Person and the Issuer.
99.4 Standstill Agreement dated as of the Closing Date by and
among the Issuer and the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II and Glenn W.
Schaeffer.
99.5 Registration Rights Agreement dated as of the Closing Date by
and among the Issuer and the Reporting Person, William A.
Richardson, David R. Belding, Peter A. Simon II, Glenn W.
Schaeffer, Gregg H. Solomon, Antonio C. Alamo, Anthony Korfman,
William Ensign and Robert J. Verchota.
99.6 Agreement Pursuant to Joint Venture Agreement dated as of the
Closing Date by and among the Issuer and the Reporting Person,
Glenn W. Schaeffer and William A. Richardson (incorporated by
reference to Exhibit I to Exhibit 10(ee) to the Issuer's Annual
Report on Form 10-K for the year ended January 31, 1995).
Page 8 of ___ Pages
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EXHIBIT 99.2
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
-----------------------------------------------
THIS FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated May 30, 1995,
is made and entered into by and among CIRCUS CIRCUS ENTERPRISES, INC., a Nevada
corporation, M.S.E. INVESTMENTS, INCORPORATED, a Nevada corporation, LAST CHANCE
INVESTMENTS, INCORPORATED, a Nevada corporation, GOLDSTRIKE INVESTMENTS,
INCORPORATED, a Nevada corporation, DIAMOND GOLD, INC., a Nevada corporation,
GOLD STRIKE AVIATION, INCORPORATED, a Nevada corporation, GOLDSTRIKE FINANCE
COMPANY, INC., a Nevada corporation, OASIS DEVELOPMENT COMPANY, INC., a Nevada
corporation, MICHAEL S. ENSIGN, an individual, WILLIAM A. RICHARDSON, an
individual, DAVID R. BELDING, an individual, PETER A. SIMON II, an individual
and ROBERT J. VERCHOTA, an individual. Capitalized terms used but not otherwise
defined herein shall have the respective meanings ascribed to them in the
Agreement and Plan of Merger (as defined below).
RECITALS
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WHEREAS, the parties hereto entered into an Agreement and Plan of
Merger, dated as of March 19, 1995 (the "Agreement and Plan of Merger"); and
WHEREAS, the parties hereto desire to amend the Agreement and Plan of
Merger.
NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto do agree to amend the Agreement and Plan of
Merger as follows:
1. Section 1.1 of the Agreement and Plan of Merger entitled
"Definitions" shall be and is hereby amended to substitute the following
definition of "Joint Ventures:"
"JOINT VENTURES" shall mean (a) Lakeview Gaming (but excluding Lakeview
Company and Pioneer Investment Group), (b) Elgin Riverboat Resort (but
excluding RBG), (c) Pine Hills Development (but excluding Family Lands) and
(d) Victoria Partners (but excluding MRGS).
2. Section 1.1 of the Agreement and Plan of Merger entitled
"Definitions" shall be and is hereby amended to substitute the following
definition of "Registration Rights Agreement:"
"REGISTRATION RIGHTS AGREEMENT" shall mean the Registration Rights
Agreement by and among the Company and each of the Target Company
Shareholders, the Individuals and Verchota, substantially in the form
attached hereto as Exhibit "D".
3. Section 2.1(c) of the Agreement and Plan of Merger entitled
"Ancillary Agreements" shall be and is hereby amended to read in its entirety as
follows:
On the Closing Date, upon the terms and subject to the conditions of this
Agreement: the Company and Verchota shall execute and deliver the Verchota
Assignment Agreement, the Company and Ensign shall execute and deliver the
Ensign Assignment Agreement, the Company and Simon shall execute and
deliver the Simon Assignment Agreement, the Company and each of the Target
Company Shareholders, the Individuals and Verchota shall execute and
deliver the Registration Rights Agreement, each of the Circus Circus Senior
Executives and the Gold Strike Senior Executives and the Company shall
execute and deliver a Senior Executive Employment Agreement and each of the
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Target Company Shareholders and Schaeffer and the Company shall execute and
deliver the Standstill Agreement.
4. Section 2.2 of the Agreement and Plan of Merger entitled
"Consideration for the Mergers and Transfers" shall be and is hereby amended to
read in its entirety as follows:
In consideration of the Mergers and the Transfers, the Company shall issue
(the "STOCK ISSUANCE") fully paid and nonassessable shares of its Common
Stock to the Target Company Shareholders and Verchota. The total number of
shares of Common Stock to be issued shall be 16,291,551 shares, plus cash
of $11,839,535. The cash and shares of Common Stock to be issued in the
Stock Issuance shall be allocated among the Target Company Shareholders and
Verchota as follows:
<TABLE>
<CAPTION>
Total Consideration Total Shares Total Cash
<S> <C> <C> <C>
Michael S. Ensign 39.92616% 6,501,933 $4,795,193
Richardson 39.65520% 6,457,807 $4,762,650
Belding 9.89609% 1,611,567 $1,188,535
Simon 9.10194% 1,482,242 $1,093,157
Verchota 1.42061% 238,002 $0
</TABLE>
The Target Company Shareholders and Verchota acknowledge that the shares of
Common Stock to be issued in the Stock Issuance will not be registered
under the Securities Act or under any state securities law and that they
will be listed on the New York Stock Exchange. Of the cash to be received
by Ensign and Simon, $300,000 shall be allocated to each of the Ensign
Assignment Agreement and the Simon Assignment Agreement.
5. Section 3.4 of the Agreement and Plan of Merger entitled
"Ownership of Each of the Joint Ventures" shall be and is hereby amended to
substitute the following ownership table for "Lakeview Gaming":
<TABLE>
<CAPTION>
ENTITY PARTNERS/ OWNERSHIP
MEMBERS INTEREST
<S> <C> <C>
Lakeview Gaming Lakeview Company 12.5%
Railroad Pass 12.5%
Jean Development 12.5%
Jean West 12.5%
Jean North 12.5%
Pioneer Investment Group 12.5%
Nevada Landing 12.5%
GSLV 12.5%
</TABLE>
2
<PAGE>
6. Section 3.16 of the Agreement and Plan of Merger entitled
"Financial Statements" shall be and is hereby amended to add a new subsection
(c) as follows:
(c) The Target Companies have previously delivered to the Company copies
of the Target Companies' (excluding ODC and investments in Fuel and Fuel
West), the Acquired Entities' and the Joint Ventures' (except that the
investment in the Elgin Riverboat Resort is recorded under the equity
method of accounting) audited combined financial statements for their year
ended December 31, 1994 (the "Audited Year-End Financials"). The Audited
Year-End Financials fairly present in all material respects the financial
position and results of operations of the Target Companies (excluding ODC
and investments in Fuel and Fuel West), the Acquired Entities and the Joint
Ventures on a combined basis in accordance with generally accepted
accounting principles applied on a basis consistent with prior periods,
except as may be indicated in the notes or schedules thereto, and except
(i) the income of Fuel and Fuel West is presented in discontinued
operations and (ii) the financial position and results of operations of the
Elgin Riverboat Resort are recorded under the equity method of accounting.
The Audited Year-End Financials have been audited by, and include the
related opinions of, Arthur Andersen LLP, independent public accountants,
which place reliance on Coopers & Lybrand with regard to the investment in,
and equity income derived from, the Elgin Riverboat Resort. The combined
balance sheets included in the Audited Year-End Financials fairly present
in all material respects the combined financial condition of the entities
set forth therein as at their respective dates, and the statements of
income and retained earnings and of cash flows, fairly present in all
material respects the combined operations of the entities set forth therein
for the periods ended on the respective dates of the related balance
sheets.
7. Section 3.31 of the Agreement and Plan of Merger entitled
"Investment Representations" shall be and is hereby amended to read in its
entirety as follows:
(a) Each of the Target Company Shareholders and Verchota understands that
the Common Stock to be issued and delivered to him in the Stock Issuance
has not been registered pursuant to the registration requirements of the
Securities Act by reason of the reliance on an exemption from the
registration requirements of the Securities Act pursuant to Section 4(2)
thereof.
(b) Each of the Target Company Shareholders and Verchota (i) has the
capacity to protect his own interests in connection with the transactions
contemplated hereby, (ii) is able to bear the economic risk thereof, (iii)
is knowledgeable, sophisticated and experienced in business and financial
matters and has previously invested in securities similar to the Common
Stock, and (iv) is an "accredited investor" (as such term is defined in
Rule 501(a) of Regulation D under the Securities Act) or if not an
"accredited investor," is either alone or with his "purchaser
representative" (as such term is defined in Rule 501(h) of Regulation D
under the Securities Act) such knowledge and experience in financial
matters that he is capable of evaluating the merits and risks of an
investment in the Common Stock. The Company has delivered or made available
to each of the Target Company Shareholders and Verchota such documents,
materials and information pertaining to the Company as he may have
requested and has afforded him an opportunity to ask questions of and
receive answers from the Company and its executive officers and
representatives.
3
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(c) Each of the Target Company Shareholders and Verchota understands that
the Common Stock to be issued in the Stock Issuance may not be sold,
transferred or otherwise disposed of without registration under the
Securities Act or an exemption therefrom, and that in the absence of an
effective registration statement covering the same or an available
exemption from registration under the Securities Act, such Common Stock
must be held indefinitely. In the absence of an effective registration
statement under the Securities Act or an exemption therefrom, each of the
Target Company Shareholders and Verchota will not sell, transfer or
otherwise dispose of any Common Stock received in the Stock Issuance,
except in a manner consistent with his representations set forth in this
Section.
(d) Each of the Target Company Shareholders and Verchota understands and
acknowledges that each certificate representing the Common Stock issued to
him in the Stock Issuance will bear a legend to the following effect:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH
SECURITIES MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED, PLEDGED
OR HYPOTHECATED EXCEPT PURSUANT TO (I) A REGISTRATION STATEMENT WITH
RESPECT TO SUCH SECURITIES, WHICH IS EFFECTIVE UNDER SUCH ACT, OR (II)
ANY EXEMPTION FROM REGISTRATION UNDER SUCH ACT RELATING TO THE
DISPOSITION OF SECURITIES, INCLUDING RULE 144, PROVIDED AN OPINION OF
COUNSEL IS FURNISHED, REASONABLY SATISFACTORY IN FORM AND SUBSTANCE TO
THE COMPANY, THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
SUCH ACT IS AVAILABLE."
(e) Each of the Target Company Shareholders and Verchota represents that
he has carefully read this Section and discussed its requirements and other
applicable limitations upon his ability to sell, transfer or otherwise
dispose of the Common Stock received in the Stock Issuance to the extent
that he felt necessary with his counsel and will not make any sale,
transfer or other disposition of such Common Stock in violation of the
Securities Act or the rules and regulations thereunder.
8. Section 3.32 of the Agreement and Plan of Merger entitled
"Burton Agreement," which shall be re-titled "Burton Contract," is hereby
amended to read in its entirety as follows:
Gold Strike Resorts, Inc. has transferred all of its right, title and
interest in and to the Burton Contract to GSLV.
9. Section 4.2 of the Agreement and Plan of Merger entitled
"Capitalization" shall be and is hereby amended to read in its entirety as
follows:
The authorized capital stock of the Company consists of 450,000,000 shares
of Common Stock and 75,000,000 shares of Preferred Stock. As of the date of
this Agreement (i) 85,852,798 shares of Common Stock are validly issued and
outstanding, fully paid and nonassessable, (ii) no shares of Preferred
Stock are issued and outstanding and (iii) 5,617,204 shares of Common Stock
are issuable upon exercise of outstanding Options heretofore granted.
Except as contemplated by clauses (i) through (iii) above, Exhibits E and F
hereto, or the Exchange Agreement, and except for the Rights, there are no
other shares of capital stock, or other equity securities of the Company
outstanding, and no other outstanding options, warrants, rights to
subscribe to (including any
4
<PAGE>
preemptive rights), calls or commitments of any character whatsoever to
which the Company or any of its subsidiaries is a party or may be bound,
requiring the issuance or sale of shares of any capital stock or other
equity securities of the Company or securities or rights convertible into
or exchangeable for such shares or other equity securities, and there are
no contracts, commitments, understandings or arrangements by which the
Company is or may become bound to issue additional shares of its capital
stock or other equity securities or options, warrants or rights to purchase
or acquire any additional shares of its capital stock or other equity
securities or securities convertible into or exchangeable for such shares
or other equity securities.
10. Section 5.4 of the Agreement and Plan of Merger entitled
"Registration Rights" shall be and is hereby amended to read in its entirety as
follows:
At or prior to the Closing, the Company and each of the Target Company
Shareholders and Verchota shall, and shall cause each of the Individuals
to, enter into the Registration Rights Agreement.
11. Section 6.2(b) of the Agreement and Plan of Merger entitled
"Additional Conditions to the Company's Obligations" shall be and is hereby
amended to read in its entirety as follows:
None of the Gold Strike Persons' representations and warranties contained
in Article 3 shall be untrue in any respect, either when made or at and as
of the Effective Time (except as affected by the transactions contemplated
by this Agreement).
12. Section 9.11 of the Agreement and Plan of Merger entitled
"Representations and Warranties of Verchota" shall be and is hereby amended to
read in its entirety as follows:
Verchota represents and warrants to the Company that, as of the date of
this Agreement, each of the representations and warranties contained in
Section 3.5 (with respect to his proportionate partnership interest in
Railroad Pass), Section 3.10 (only with respect to Verchota), Section 3.12
(only with respect to Verchota) and Section 3.31 (only with respect to
Verchota) are true and correct in all respects.
13. This Amendment shall be and is hereby incorporated in and forms
a part of the Agreement and Plan of Merger, and shall be effective as of March
19, 1995.
14. This Amendment may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
15. All other terms and provisions of the Agreement and Plan of
Merger shall remain unchanged except as specifically modified herein.
[Signature page to follow]
5
<PAGE>
IN WITNESS WHEREOF, each party has executed this Amendment as of the
date first above written.
CIRCUS CIRCUS ENTERPRISES, INC.,
a Nevada corporation
By /s/ Clyde T. Turner
___________________________________________
Name: Clyde T. Turner
Title: President and Chief Executive
Officer
M.S.E. INVESTMENTS, INCORPORATED,
a Nevada corporation
By /s/ Michael S. Ensign
___________________________________________
Name: Michael S. Ensign
Title: President
LAST CHANCE INVESTMENTS, INCORPORATED,
a Nevada corporation
By /s/ William A. Richardson
___________________________________________
Name: William A. Richardson
Title: President
GOLDSTRIKE INVESTMENTS, INCORPORATED,
a Nevada corporation
By /s/ David R. Belding
___________________________________________
Name: David R. Belding
Title: President
DIAMOND GOLD, INC.,
a Nevada corporation
By /s/ Peter A. Simon II
___________________________________________
Name: Peter A. Simon II
Title: President
S-1
<PAGE>
GOLD STRIKE AVIATION, INCORPORATED,
a Nevada corporation
By /s/ William A. Richardson
___________________________________________
Name: William A. Richardson
Title: President
GOLDSTRIKE FINANCE COMPANY, INC.,
a Nevada corporation
By /s/ Michael S. Ensign
___________________________________________
Name: Michael S. Ensign
Title: President
OASIS DEVELOPMENT COMPANY, INC.
a Nevada corporation
By /s/ Peter A. Simon II
___________________________________________
Name: Peter A. Simon II
Title: President
/s/ Michael S. Ensign
_____________________________________________
Michael S. Ensign
/s/ William A. Richardson
_____________________________________________
William A. Richardson
/s/ David R. Belding
_____________________________________________
David R. Belding
/s/ Peter A. Simon II
_____________________________________________
Peter A. Simon II
/s/ Robert J. Verchota
_____________________________________________
Robert J. Verchota
S-2
<PAGE>
EXHIBIT 99.3
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into this 1st day of June, 1995, by
and between Circus Circus Enterprises, Inc., a Nevada corporation (the
"Company") and Michael Ensign ("Executive").
W I T N E S S E T H:
WHEREAS, Executive and the Company deem it to be in their respective
best interests to enter into an agreement providing for the Company's employment
of Executive pursuant to the terms herein stated;
NOW, THEREFORE, in consideration of the premises and the mutual
promises and agreements contained herein, it is hereby agreed as follows:
1. Effective Date. This Agreement shall be effective as of the 1st
--------------
day of June, 1995, which date shall be referred to herein as the "Effective
Date".
2. Position and Duties.
-------------------
(a) The Company hereby employs Executive as its Vice Chairman
of the Board and Chief Operating Officer commencing as of the Effective Date for
the "Term of Employment" (as herein defined below). In this capacity, Executive
shall devote his best efforts and his full business time and attention to the
performance of the services customarily incident to such offices and position
and to such other services of a senior executive nature as may be reasonably
requested by the Board of Directors (the "Board") of the Company which may
include services for one or more subsidiaries or affiliates of the Company.
Executive shall in his capacity as an employee and officer of the Company be
responsible to and obey the reasonable and lawful directives of the Board and of
any officers ("Supervising Officers") to whom he shall report.
(b) Executive shall devote his full time and attention to such
duties, except for sick leave, reasonable vacations, and excused leaves of
absence as more particularly provided herein. Executive shall use his best
efforts during the Term of Employment to protect, encourage, and promote the
interests of the Company.
<PAGE>
3. Compensation.
------------
(a) Base Salary. The Company shall pay to Executive during the
-----------
Term of Employment a minimum salary at the rate of six hundred twenty-five
thousand dollars ($625,000) percalendar year and agrees that such salary shall
be reviewed at least annually. Such salary shall be subject to mandatory annual
increases for each year during the Term of Employment equal to 5% of the rate of
salary in effect immediately prior to each such increase, with further
discretionary increases as determined by the Board of Directors. Such salary
shall be payable in accordance with the Company's normal payroll procedures.
(Executive's annual salary, as set forth above or as it may be increased from
time to time as set forth herein, shall be referred to hereinafter as "Base
Salary.") At no time during the Term of Employment shall Executive's Base Salary
be decreased from the amount of Base Salary then in effect.
(b) Performance Bonus. In addition to the compensation
-----------------
otherwise payable to Executive pursuant to this Agreement, Executive shall be
eligible to receive an annual bonus ("Bonus") pursuant to a performance bonus
plan (the "Bonus Plan") which shall be established by the Company for its senior
executive officers and which shall provide for bonus compensation to be payable
based upon the financial and other performance of the Company and its senior
executives. It is intended that the Bonus Plan shall conform to the requirements
applicable to "qualified performance based compensation" under Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code"). During the Term of
Employment, Executive's targeted annual bonus under the Bonus Plan shall not be
less than 100% of Executive's then current Base Salary.
4. Benefits. During the Term of Employment:
--------
(a) Executive shall be eligible to participate in any life,
health and long-term disability insurance programs, pension and retirement
programs, stock option and other incentive compensation programs, and other
fringe benefit programs made available to senior executive employees of the
Company from time to time, and Executive shall be entitled to receive such other
fringe benefits as may be granted to him from time to time by the Company's
Board of Directors.
(b) Executive shall be allowed vacations and leaves of absence
with pay on the same basis as other senior executive employees of the Company.
(c) The Company shall reimburse Executive for reasonable
business expenses incurred in performing Executive's duties and promoting the
business of the Company, including, but not limited to, reasonable entertainment
expenses, travel and lodging expenses, following presentation of documentation
in accordance with the Company's business expense reimbursement policies.
2
<PAGE>
(d) Executive shall be added as an additional named insured
under all liability insurance policies now in force or hereafter obtained
covering any officer or director of the Company in his or her capacity as an
officer or director. Company shall indemnify Executive in his capacity as an
officer or director and hold him harmless from any cost, expense or liability
arising out of or relating to any acts or decisions made by him on behalf of or
in the course of performing services for the Company (to the maximum extent
provided by the Company's Bylaws and applicable law).
5. Term; Termination of Employment. As used herein, the phrase "Term
-------------------------------
of Employment" shall mean the period commencing on the Effective Date and ending
three (3) years from the Effective Date, provided that as of the expiration date
of each of (i) the initial three (3) year Term of Employment and (ii) if
applicable, any Renewal Period (as defined below), the Term of Employment shall
automatically be extended for a one (1) year period (each a "Renewal Period")
unless either the Company or Executive provides six (6) months' notice to the
contrary. Notwithstanding the foregoing, the Term of Employment shall expire on
the first to occur of the following:
(a) Termination by the Company Without Cause or By Executive
--------------------------------------------------------
With Good Reason. Notwithstanding anything to the contrary in this Agreement,
- ----------------
whether express or implied, the Company may, at any time, terminate Executive's
employment for any reason other than Cause (as defined below) by giving
Executive at least 60 days' prior written notice of the effective date of
termination. In the event Executive's employment hereunder is terminated by the
Company other than for Cause or by Executive for Good Reason (as defined below),
Executive shall be entitled to receive (x) his Base Salary as he would have
received such amounts during the period commencing on the effective date of such
termination and ending on the later of (i) the expiration of the Term of
Employment or (ii) the date that is twelve (12) months following the effective
date of such termination (the "Salary Continuation Period"), as if Executive
were still employed hereunder during the Salary Continuation Period; (y) if it
has not previously been paid to Executive, any Bonus to which Executive had
become entitled under the Bonus Plan prior to the effective date of such
termination; and (z) annual Bonuses during the Salary Continuation Period in an
amount equal to the product of Executive's Base Salary on the effective date of
such termination and the minimum targeted bonus percentage specified in Section
3(b), payable in the ordinary course and prorated, as applicable, for any
partial fiscal year of the Bonus Plan ending on the final day of the Salary
Continuation Period. In addition, all of Executive's stock options with respect
to the Company's stock shall become immediately and fully exercisable. During
the Salary Continuation Period, Executive and his spouse and dependents shall be
entitled to continue to be covered by all group medical, health and accident
insurance or other such health care arrangements in which Executive was a
participant as of the date of such termination, at the same coverage level and
on the same terms and conditions which applied immediately prior to the date of
Executive's termination of employment, until Executive obtains alternative
comparable coverage under another group plan, which coverage does not contain
any pre-existing condition exclusions or limitations; provided, however, that
--------
if, as the result of the termination of Executive's employment, Executive
and/or his otherwise eligible dependents or
3
<PAGE>
beneficiaries shall become ineligible for benefits under any one or more of the
Company's benefit plans, the Company shall continue to provide Executive and his
eligible dependents or beneficiaries, through other means, with benefits at a
level at least equivalent to the level of benefits for which Executive and his
dependents and beneficiaries were eligible under such plans immediately prior to
the date of Executive's termination of employment. At the termination of the
benefits coverage under the preceding sentence, Executive and his spouse and
dependents shall be entitled to continuation coverage pursuant to Section 4980B
of the Internal Revenue Code of 1986, as amended, Sections 601-608 of the
Employee Retirement Income Security Act of 1974, as amended, and under any other
applicable law, to the extent required by such laws, as if Executive had
terminated employment with the Company on the date such benefits coverage
terminates.
For purposes of this Agreement, "Good Reason" shall mean, without the
express written consent of Executive, the occurrence of any of the following
events unless such events are fully corrected within 30 days following written
notification by Executive to the Company that he intends to terminate his
employment hereunder for one of the reasons set forth below:
i) a material breach by the Company of any material
provision of this Agreement, including, without
limitation, the assignment to Executive of any duties
inconsistent with Executive's position in the Company or
an adverse alteration in the nature or status of
Executive's responsibilities;
ii) the Company's requiring Executive to be based anywhere
other than the metropolitan area where he currently works
and resides;
iii) the occurrence of a "Change in Control" as defined
below; and
iv) the Company's notifying Executive that it does not
consent to any automatic one-year extension of the Term
of Employment.
For purposes of this Agreement a "Change in Control" shall mean an event as
a result of which: (i) any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities and Exchange Act of 1934 (the "Exchange Act")), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act,
except that a person shall be deemed to have "beneficial ownership" of all
securities that such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 50% of the total voting power of the voting stock of
the Company; (ii) the Company consolidates with, or merges with or into another
corporation or sells, assigns, conveys, transfers, leases or otherwise disposes
of all or substantially all of its assets to any person, or any corporation
consolidates with, or merges with or into, the Company, in any such event
pursuant to a transaction in which the outstanding voting stock of the Company
is changed into or exchanged for cash, securities or other property, other than
any such
4
<PAGE>
transaction where (A) the outstanding voting stock of the Company is changed
into or exchanged for (x) voting stock of the surviving or transferee
corporation or (y) cash, securities (whether or not including voting stock) or
other property, and (B) the holders of the voting stock of the Company
immediately prior to such transaction own, directly or indirectly, not less than
50% of the voting power of the voting stock of the surviving corporation
immediately after such transaction; or (iii) during any period of two
consecutive years, individuals who at the beginning of such period constituted
the Board of the Company (together with any new directors whose election by such
Board or whose nomination for election by the stockholders of the Company was
approved by a vote of 66-2/3% of the directors then still in office who were
either directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute a
majority of the Board of the Company then in office; or (iv) the Company is
liquidated or dissolved or adopts a plan of liquidation, provided however that a
Change in Control shall not include any going private or leveraged buy-out
transaction which is sponsored by Executive or in which Executive acquires an
equity interest materially in excess of his equity interest in the Company
immediately prior to such transaction (each of the events described in (i),
(ii), (iii) or (iv) above, as provided otherwise by the preceding clause being
referred to herein as a "Change in Control").
(b) Termination for Cause. The Company shall have the right to
---------------------
terminate Executive's employment at any time for Cause by giving Executive
written notice of the effective date of termination (which effective date may,
except as otherwise provided below, be the date of such notice). If the Company
terminates Executive's employment for Cause, Executive shall be paid his unpaid
Base Salary through the date of termination and the amount of any unpaid Bonus
to which Executive had become entitled under the Bonus Plan prior to the
effective date of such termination and the Company shall have no further
obligation hereunder from and after the effective date of termination and the
Company shall have all other rights and remedies available under this or any
other agreement and at law or in equity.
For purposes of this Agreement only, Cause shall mean:
i) fraud, misappropriation, embezzlement, or other act of
material misconduct against the Company or any of its
affiliates;
ii) substantial and willful failure to perform specific and
lawful directives of the Board or any Supervising
Officer, as reasonably determined by the Board;
iii) willful and knowing violation of any rules or regulations
of any governmental or regulatory body, which is
materially injurious to the financial condition of the
Company;
iv) conviction of or plea of guilty or nolo contendere to a
felony;
5
<PAGE>
v) Executive's loss of any personal gaming or related
regulatory approval or license required to perform his
duties under this Agreement; or
vi) a final determination by a court of competent
jurisdiction that Executive breached the Standstill
Agreement of even date herewith by and among Circus
Circus Enterprises, Inc., a Nevada corporation, Michael
S. Ensign, William R. Richardson, David R. Belding, Peter
A. Simon II, and Glenn W. Schaeffer;
provided, however, that with regard to subparagraph ii) above, Executive may not
- --------
be terminated for Cause unless and until the Board has given him reasonable
written notice of its intended actions and specifically describing the alleged
events, activities or omissions giving rise thereto and with respect to those
events, activities or omissions for which a cure is possible, a reasonable
opportunity to cure such breach; and provided, further, that for purposes of
--------
determining whether any such Cause is present, no act or failure to act by
Executive shall be considered "willful" if done or omitted to be done by
Executive in good faith and in the reasonable belief that such act or omission
was in the best interest of the Company and/or required by applicable law.
(c) Termination on Account of Death. In the event of
-------------------------------
Executive's death while in the employ of the Company, his employment hereunder
shall terminate on the date of his death and Executive shall be paid his unpaid
Base Salary through the date of termination and the amount of any unpaid Bonus
to which Executive had become entitled under the Bonus Plan prior to the
effective date of such termination. In addition, any other benefits payable on
behalf of Executive shall be determined under the Company's insurance and other
compensation and benefit plans and programs then in effect in accordance with
the terms of such programs.
(d) Voluntary Termination by Executive. In the event that
----------------------------------
Executive's employment with the Company is voluntarily terminated by Executive
other than for Good Reason, Executive shall be paid his unpaid Base Salary
through the date of termination and the amount of any unpaid Bonus to which
Executive had become entitled under the Bonus Plan prior to the effective date
of such termination, and the Company shall have no further obligation hereunder
from and after the effective date of termination and the Company shall have all
other rights and remedies available under this Agreement or any other agreement
and at law or in equity. Executive shall give the Company at least 30 days'
advance written notice of his intention to terminate his employment hereunder.
(e) Termination on Account of Disability. To the extent not
------------------------------------
prohibited by The Americans With Disabilities Act of 1990 or Chapter 613 of the
Nevada Revised Statutes, if, as a result of Executive's incapacity due to
physical or mental illness (as determined in good faith by a physician
acceptable to the Company and Executive), Executive shall have been absent from
the full-time performance of his duties with the Company for 120
6
<PAGE>
consecutive days during any twelve (12) month period or if a physician
acceptable to the Company advises the Company that it is likely that Executive
will be unable to return to the full-time performance of his duties for 120
consecutive days during the succeeding twelve (12) month period, his employment
may be terminated for "Disability." During any period that Executive fails to
perform his full-time duties with the Company as a result of incapacity due to
physical or mental illness, he shall continue to receive his Base Salary, Bonus
and other benefits provided hereunder, together with all compensation payable to
him under the Company's disability plan or program or other similar plan during
such period, until Executive's employment hereunder is terminated pursuant to
this Section 5(e). Thereafter, Executive's benefits shall be determined under
the Company's retirement, insurance, and other compensation and benefit plans
and programs then in effect, in accordance with the terms of such programs.
6. Confidential Information, Non-Solicitation and Non-Competition.
--------------------------------------------------------------
(a) During the Term of Employment and for three (3) years
thereafter, Executive shall not, except as may be required to perform his duties
hereunder or as required by applicable law, disclose to others or use, whether
directly or indirectly, any Confidential Information regarding the Company.
"Confidential Information" shall mean information about the Company, its
subsidiaries and affiliates, and their respective clients and customers that is
not available to the general public and that was learned by Executive in the
course of his employment by the Company, including (without limitation) any
proprietary knowledge, trade secrets, data, formulae, information, and client
and customer lists and all papers, resumes, records (including computer records)
and the documents containing such Confidential Information. Executive
acknowledges that such Confidential Information is specialized, unique in nature
and of great value to the Company, and that such information gives the Company a
competitive advantage. Upon the termination of his employment for any reason
whatsoever, Executive shall promptly deliver to the Company all documents,
computer tapes and disks (and all copies thereof) containing any Confidential
Information.
(b) During the period that Executive is receiving payments
under this Agreement (which Executive may elect to terminate at any time),
Executive shall not, directly or indirectly in any manner or capacity (e.g., as
an advisor, principal, agent, partner, officer, director, shareholder, employee,
member of any association or otherwise) engage in, work for, consult, provide
advice or assistance or otherwise participate in any activity which is
competitive with the business of the Company in any geographic area in which the
Company is now or shall then be doing business. Executive further agrees that
during such period he will not assist or encourage any other person in carrying
out any activity that would be prohibited by the foregoing provisions of this
Section 6 if such activity were carried out by Executive and, in particular,
Executive agrees that he will not induce any employee of the Company to carry
out any such activity; provided, however, that the "beneficial ownership" by
Executive, either individually or as a member of a "group," as such terms are
used in Rule 13d of the General Rules and Regulations under the Exchange Act, of
not more than five percent (5%) of the voting stock of any publicly held
corporation shall not be a violation of this Agreement. It
7
<PAGE>
is further expressly agreed that the Company will or would suffer irreparable
injury if Executive were to compete with the Company or any subsidiary or
affiliate of the Company in violation of this Agreement and that the Company
would by reason of such competition be entitled to injunctive relief in a court
of appropriate jurisdiction, and Executive further consents and stipulates to
the entry of such injunctive relief in such a court prohibiting Executive from
competing with the Company or any subsidiary or affiliate of the Company in
violation of this Agreement.
(c) During the Term of Employment and for three (3) years
thereafter, Executive shall not, directly or indirectly, influence or attempt to
influence customers or suppliers of the Company or any of its subsidiaries or
affiliates, to divert their business to any competitor of the Company.
(d) Executive recognizes that he will possess confidential
information about other employees of the Company relating to their education,
experience, skills, abilities, compensation and benefits, and interpersonal
relationships with customers of the Company. Executive recognizes that the
information he will possess about these other employees is not generally known,
is of substantial value to the Company in developing its business and in
securing and retaining customers, and will be acquired by him because of his
business position with the Company. Executive agrees that, during the Term of
Employment, and for a period of three (3) years thereafter, he will not,
directly or indirectly, solicit or recruit any employee of the Company for the
purpose of being employed by him or by any competitor of the Company on whose
behalf he is acting as an agent, representative or employee and that he will not
convey any such confidential information or trade secrets about other employees
of the Company to any other person.
(e) If it is determined by a court of competent jurisdiction in
any state that any restriction in this Section 6 is excessive in duration or
scope or is unreasonable or unenforceable under the laws of that state, it is
the intention of the parties that such restriction may be modified or amended by
the court to render it enforceable to the maximum extent permitted by the law of
that state.
7. No Offset - No Mitigation. Executive shall not be required to
-------------------------
mitigate damages under this Agreement by seeking other comparable employment.
The amount of any payment or benefit provided for in this Agreement, including
welfare benefits, shall not be reduced by any compensation or benefits earned by
or provided to him as the result of employment by another employer, except as
provided otherwise in Section 5(a) with respect to health and insurance benefits
provided during the Salary Continuation Period.
8. Designated Beneficiary. In the event of the death of Executive
----------------------
while in the employ of the Company, or at any time thereafter during which
amounts remain payable to Executive under Section 5, such payments (other than
the right to continuation of welfare benefits) shall thereafter be made to such
person or persons as Executive may specifically designate (successively or
contingently) to receive payments under this Agreement following
8
<PAGE>
Executive's death by filing a written beneficiary designation with the Company
during Executive's lifetime. Such beneficiary designation shall be in such form
as may be prescribed by the Company and may be amended from time to time or may
be revoked by Executive pursuant to written instruments filed with the Company
during his lifetime. Beneficiaries designated by Executive may be any natural or
legal person or persons, including a fiduciary, such as a trustee or a trust or
the legal representative of an estate. Unless otherwise provided by the
beneficiary designation filed by Executive, if all of the persons so designated
die before Executive on the occurrence of a contingency not contemplated in such
beneficiary designation, then the amounts payable under this Agreement shall be
paid to Executive's estate.
9. Taxes. All payments to be made to Executive under this Agreement
-----
will be subject to any applicable withholding of federal, state and local income
and employment taxes.
10. Miscellaneous. This Agreement shall also be subject to the
-------------
following miscellaneous considerations:
(a) Executive and the Company each represent and warrant to the
other that he or it has the authorization, power and right to deliver, execute,
and fully perform his or its obligations under this Agreement in accordance with
its terms.
(b) This Agreement contains a complete statement of all the
arrangements between the parties with respect to Executive's employment by the
Company, this Agreement supersedes all prior and existing negotiations and
agreements between the parties concerning Executive's employment, and this
Agreement can only be changed or modified pursuant to a written instrument duly
executed by each of the parties hereto.
(c) If any provision of this Agreement or any portion thereof
is declared invalid, illegal, or incapable of being enforced by any court of
competent jurisdiction, the remainder of such provisions and all of the
remaining provisions of this Agreement shall continue in full force and effect.
(d) This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Nevada, except to the extent
governed by federal law.
(e) The Company may assign this Agreement to any direct or
indirect subsidiary or parent of the Company or joint venture in which the
Company has an interest, or any successor (whether by merger, consolidation,
purchase or otherwise) to all or substantially all of the stock, assets or
business of the Company and this Agreement shall be binding upon and inure to
the benefit of such successors and assigns. Except as expressly provided herein,
Executive may not sell, transfer, assign, or pledge any of his rights or
interests pursuant to this Agreement.
(f) Any rights of Executive hereunder shall be in addition to
any rights Executive may otherwise have under benefit plans, agreements, or
arrangements of the
9
<PAGE>
Company to which he is a party or in which he is a participant, including, but
not limited to, any Company-sponsored employee benefit plans. Provisions of this
Agreement shall not in any way abrogate Executive's rights under such other
plans, agreements, or arrangements.
(g) For the purpose of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or registered mail, return receipt requested, postage prepaid,
addressed to the named Executive at the address set forth below under his
signature; provided that all notices to the Company shall be directed to the
attention of the Board with a copy to the Secretary of the Company, or to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.
(h) Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
(i) Failure to insist upon strict compliance with any of the
terms, covenants, or conditions hereof shall not be deemed a waiver of such
term, covenant, or condition, nor shall any waiver or relinquishment of, or
failure to insist upon strict compliance with, any right or power hereunder at
any one or more times be deemed a waiver or relinquishment of such right or
power at any other time or times.
(j) This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
11. Resolution of Disputes. Any dispute or controversy arising under
----------------------
or in connection with this Agreement shall be settled exclusively by
arbitration, conducted before a panel of three arbitrators in Las Vegas, Nevada
in accordance with the rules of the American Arbitration Association then in
effect. The Company and Executive hereby agree that the arbitrator will not have
the authority to award punitive damages, damages for emotional distress or any
other damages that are not contractual in nature. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that the
Company shall be entitled to seek a restraining order or injunction in any court
of competent jurisdiction to prevent any continuation of any violation of the
provisions of Section 6, and Executive consents that such restraining order or
injunction may be granted without the necessity of the Company's posting any
bond except to the extent otherwise required by applicable law. The expense of
such arbitration shall be borne by the Company.
12. Attorneys' Fees. Should either party hereto or their successors
---------------
retain counsel for the purpose of enforcing, or preventing the breach of, any
provision hereof, including, but not limited to, by instituting any action or
proceeding in arbitration or a court to enforce any provision hereof or to
enjoin a breach of any provision of this Agreement, or for a
10
<PAGE>
declaration of such party's rights or obligations under the Agreement, or for
any other remedy, whether in arbitration or in a court of law, then the
successful party shall be entitled to be reimbursed by the other party for all
costs and expenses incurred thereby, including, but not limited to, reasonable
fees and expenses of attorneys and expert witnesses, including costs of appeal.
If such successful party shall recover judgment in any such action or
proceeding, such costs, expenses and fees may be included in and as part of such
judgment. The successful party shall be the party who is entitled to recover his
costs of suit, whether or not the suit proceeds to final judgment. If no costs
are awarded, the successful party shall be determined by the arbitrator or
court, as the case may be.
11
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
EXECUTIVE COMPANY
MICHAEL ENSIGN CIRCUS CIRCUS ENTERPRISES, INC.
By: /s/ Michael S. Ensign By: /s/ Clyde T. Turner
_____________________________ _____________________________
Title: Vice Chairman of the Board and Title: Chief Executive Officer
Chief Operating Officer
Address:
______________________________________
______________________________________
______________________________________
12
<PAGE>
EXHIBIT 99.4
================================================================================
STANDSTILL AGREEMENT
dated as of June 1, 1995
by and among
CIRCUS CIRCUS ENTERPRISES, INC.,
a Nevada corporation,
MICHAEL S. ENSIGN,
WILLIAM R. RICHARDSON,
DAVID R. BELDING,
PETER A. SIMON II,
and
GLENN W. SCHAEFFER
================================================================================
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE 1 - DEFINITIONS...................................................... 1
ARTICLE 2 - REPRESENTATIONS AND WARRANTIES................................... 2
2.1 Legal Capacity........................................................ 2
2.2 Enforceability........................................................ 2
2.3 Consents, etc......................................................... 2
2.4 Conflicting Agreements and Other Matters.............................. 2
ARTICLE 3 - STANDSTILL....................................................... 3
ARTICLE 4 - GENERAL PROVISIONS............................................... 4
4.1 Entire Agreement...................................................... 4
4.2 No Third-Party Beneficiaries.......................................... 4
4.3 Notices............................................................... 4
4.4 No Assignment; Binding Effect......................................... 5
4.5 Severability.......................................................... 5
4.6 Survival of Agreement................................................. 5
4.7 Governing Law......................................................... 5
4.8 Counterparts.......................................................... 5
</TABLE>
i
<PAGE>
STANDSTILL AGREEMENT
--------------------
THIS STANDSTILL AGREEMENT, dated as of June 1, 1995 (this "Agreement"), is
made and entered into by and among CIRCUS CIRCUS ENTERPRISES, INC. a Nevada
corporation (the "Company"), and each of MICHAEL S. ENSIGN, an individual
("Ensign"), WILLIAM A. RICHARDSON, an individual ("Richardson"), DAVID R.
BELDING, an individual ("Belding"), PETER A. SIMON II, an individual ("Simon"
and collectively with Ensign, Richardson and Belding, the "Target Company
Shareholders"), and GLENN W. SCHAEFFER, an individual ("Schaeffer" and
collectively with all other individuals party hereto, the "Investors").
RECITALS
--------
WHEREAS, the Company, the Target Company Shareholders, M.S.E. INVESTMENTS,
INCORPORATED, a Nevada corporation, LAST CHANCE INVESTMENTS, INCORPORATED, a
Nevada corporation, GOLDSTRIKE INVESTMENTS, INCORPORATED, a Nevada corporation,
DIAMOND GOLD, INC., a Nevada corporation, GOLD STRIKE AVIATION, INCORPORATED, a
Nevada corporation, GOLDSTRIKE FINANCE COMPANY, INC., a Nevada corporation, and
OASIS DEVELOPMENT CO., a Nevada corporation, are entering into an Agreement and
Plan of Merger, dated as of March 19, 1995, as amended, (the "Agreement and Plan
of Merger"); and
WHEREAS, as an inducement for certain parties to enter into the Agreement
and Plan of Merger and to consummate the transactions contemplated thereby, each
of the Investors and the Company has agreed to enter into this Agreement.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
ARTICLE 1
DEFINITIONS
The following defined terms shall, unless the context requires otherwise,
have the meanings ascribed in this Article 1:
"BOARD" shall mean the Board of Directors of the Company.
"CLOSING DATE" shall mean the June 1, 1995.
"EQUITY SECURITIES" shall mean all capital stock of the Company, all
securities convertible into any such stock, and all securities carrying any
warrant or right to subscribe to or purchase any such stock, or any such warrant
or right.
<PAGE>
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated pursuant thereto.
"INVESTOR AFFILIATES" shall mean the "affiliates" (as such term is
defined in Rule 12b-2 promulgated pursuant to the Exchange Act) of any Investor.
"INVESTOR REPRESENTATIVES" shall mean the directors, officers,
employees, agents or representatives of the Investors and the Investor
Affiliates.
"PERSON" shall mean any individual, firm, corporation, partnership,
joint venture, limited liability company, trust, unincorporated organization or
other entity.
"PROHIBITED ACTIONS" shall mean the actions set forth in clauses (a)
through (i) of the first paragraph of Article 3.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF
EACH OF THE INVESTORS
Each of the Investors represents and warrants to the Company as of the date
hereof as follows:
2.1 LEGAL CAPACITY. Each Investor has full legal right, power, capacity
and authority to execute and deliver this Agreement, to carry out the
transactions contemplated hereby and to comply with the terms, conditions and
provisions hereof.
2.2 ENFORCEABILITY. This Agreement has been duly and validly executed and
delivered by each of the Investors and constitutes a legal, valid and binding
obligation of each of the Investors enforceable against such Investors in
accordance with its terms, except to the extent that such enforceability may be
limited by bankruptcy, insolvency, moratorium or other laws affecting the
enforcement of creditor's rights generally or by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
2.3 CONSENTS, ETC. None of the Investors is required to obtain any
consent, order, permit, approval or authorization of, or to make any declaration
or filing with, any governmental authority or entity or other agency as a
condition to or in connection with the valid execution, delivery and performance
of this Agreement or the consummation of the transactions contemplated hereby,
except, in each case, for such consents, orders, permits, approvals,
authorizations, declarations or filings (a) as have been made or have been
obtained prior to the date hereof or (b) the absence of which, or the failure to
make or obtain which, would not prevent the performance and completion of the
transactions contemplated hereby or materially and adversely affect any of the
Investors' ability to perform its obligations hereunder.
2.4 CONFLICTING AGREEMENTS AND OTHER MATTERS. Neither the execution and
delivery of this Agreement nor the performance by each of the Investors of its
obligations hereunder will conflict with, result in a default of the terms,
conditions or provisions of, or constitute a default under, any mortgage,
2
<PAGE>
agreement, instrument, order, judgment, decree, statute, law, rule or regulation
to which any of the Investors or any of their respective properties are subject,
except, in each case, for such defaults, individually or in the aggregate, as
would not prevent the consummation of the transactions contemplated hereby or
materially and adversely affect any of the Investors' ability to perform its
obligations hereunder.
ARTICLE 3
STANDSTILL
For a period beginning on the Closing Date and terminating on the fifth
anniversary of the Closing Date, none of the Investors, the Investor Affiliates
nor the Investor Representatives, acting alone or as part of any "group" (within
the meaning of Section 13(d)(3) of the Exchange Act) shall, directly or
indirectly, unless specifically requested to do so in writing in advance by the
Board :
(a) acquire or agree, offer, seek or propose to acquire, or cause to be
acquired, ownership (including, but not limited to, beneficial ownership within
the meaning of Rule 13d-3 promulgated pursuant to the Exchange Act) of more than
9.9 percent of the outstanding Equity Securities or any rights or options to
acquire any such ownership (including from a third party); provided, that this
--------
clause (a) shall not be deemed to be violated by any Investor as a result of an
increase in the percentage Equity Securities owned by such Investor in
connection with the purchase of Equity Securities by the Company, a
recapitalization of the Company or any other similar action taken by the
Company;
(b) make, or in any way knowingly participate in, any "solicitation" of
"proxies" (as such terms are used in the proxy rules of the Securities and
Exchange Commission) to vote or seek to advise or influence in any manner
whatsoever a Person with respect to the voting of any securities of the Company;
(c) form, join, or in any way participate in a "group" (within the meaning
of Section 13(d)(3) of the Exchange Act) with respect to any voting securities
of the Company;
(d) otherwise act, whether alone or in concert with others, to seek to
propose to the Company or any of its stockholders any merger, business
combination, restructuring, recapitalization or similar transaction to or with
the Company;
(e) otherwise act, whether alone or in concert with others, to seek to
control, change or influence the management, Board or policies of the Company,
or nominate any Person as a Director of the Company who is not nominated by the
then incumbent Directors, or propose any matter to be voted upon by the
stockholders of the Company;
(f) solicit, negotiate with, or provide any information to, any Person
with respect to a merger, exchange offer or liquidation of the Company or any
other acquisition of the Company, any acquisition or voting securities of or all
or any portion of the assets of the Company, or any other similar transaction;
3
<PAGE>
(g) announce an intention to, or enter into any discussion, negotiations,
arrangements or understandings with any third party with respect to, any of the
foregoing;
(h) disclose any intention, plan or arrangement inconsistent with the
foregoing; or
(i) advise, assist or encourage any other Person in connection with any of
the foregoing;
Notwithstanding the foregoing, if a matter (i) requires approval by the
shareholders of the Company, (ii) was presented to and approved by the Board,
and (iii) was opposed by both members of the Board who were nominated by the
Target Company Shareholders pursuant to Section 5.3 of the Agreement and Plan of
Merger, then, in seeking to cause the shareholders of the Company to disapprove
of such matter, an Investor may undertake a Prohibited Action set forth in
clauses (b), (c), (e), (g), (h) and (i) with respect to such matter; provided,
that if the Prohibited Action to be taken pursuant to clause (b) above is a
solicitation in opposition to a proposal involving a merger, exchange offer or
liquidation of the Company or any other acquisition of the Company or similar
transaction, then such solicitation shall not be deemed to be a violation of
clause (f) above.
In addition, each of the Investors shall also agree during such five-year
period not to (i) request the Company (or any director, officer, employee, agent
or representative thereof), directly or indirectly, to amend or waive any
provision of this Article 3 (including this sentence), unless such request is
made privately to the Board and remains confidential and undisclosed to the
public; or (ii) except as set forth in the immediately preceding paragraph, take
any action that might require the Company to make a public announcement
regarding a possible transaction.
Notwithstanding the foregoing Prohibited Actions, it is understood and
acknowledged that any one or more of the Investors may be members of the Board
or may be officers of the Company and that the foregoing provisions of this
Article 3 shall not be construed as limiting in any way any such Person from
participating fully in such capacity as a member of the Board or as "senior
management" of the Company, respectively.
It is further understood that the provisions of this Agreement shall
supercede the provisions of the confidentiality and standstill agreement dated
March 17, 1995, among the Company and Ensign, Richardson, Belding and Schaeffer.
ARTICLE 4
GENERAL PROVISIONS
4.1 ENTIRE AGREEMENT. This Agreement, including all exhibits and
schedules hereto, and the Agreement and Plan of Merger, including all exhibits
and schedules hereto, contain the sole and entire agreement among the parties
with respect to the subject matter hereof and supersedes any and all prior
agreements, understandings, negotiations and discussions, whether oral or
written, among the parties hereto with respect to such subject matter.
4
<PAGE>
4.2 NO THIRD-PARTY BENEFICIARIES. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors and permitted assigns, and it is not the intention of the
parties to confer third-party beneficiary rights upon any other Person.
4.3 NOTICES. Unless otherwise specifically provided herein, all notices,
demands, consents, waivers and other communications required or permitted by the
terms of this Agreement shall be in writing, and any notice shall become
effective three (3) days after deposit in the United States mails, first class
postage prepaid, or one (1) day after delivery to an overnight courier or
express company or immediately upon delivery by hand or in the form of telecopy,
telegram or other electronic means of communication that produces a written
copy, and, if mailed or delivered by courier, express company or hand, shall be
addressed as indicated in Section 9.3 of the Agreement and Plan of Merger or
Section 6.8 of the Exchange Agreement, dated as of March 19, 1995, by and
between, among others, the Company and Schaeffer, as the case may be.
4.4 NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any right,
interest, duty or obligation hereunder may be assigned by any party hereto
without the prior written consent of the other parties hereto, and any attempt
to assign this Agreement or any right, interest, duty or obligation hereunder
without such prior written consent shall be null and void. Subject to the
preceding sentence, this Agreement is binding upon, inures to the benefit of and
is enforceable by the parties hereto and their respective successors and
assigns.
4.5 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (i) such provision will be fully
severable, (ii) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
and (iii) the remaining provisions of this Agreement will remain in full force
and effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance from this Agreement.
4.6 SURVIVAL OF AGREEMENT. The representations, warranties and agreements
of the parties provided for in this Agreement, and the parties' obligations
under any and all thereof, shall survive the Closing and shall be and continue
in effect, notwithstanding any investigation made by any party, from and after
the Closing Date.
4.7 GOVERNING LAW. This Agreement has been negotiated and executed and
shall be performed in the State of Nevada and shall be governed and construed by
the laws of such State, without giving effect to the conflicts of laws
principles thereof.
4.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
[Signature pages to follow]
5
<PAGE>
IN WITNESS WHEREOF, each party has executed this Agreement as of the date
first above written.
CIRCUS CIRCUS ENTERPRISES, INC.,
a Nevada corporation
By /s/ Clyde T. Turner
____________________________________________
Name: Clyde T. Turner
Title: President and Chief Executive Officer
/s/ Michael S. Ensign
______________________________________________
Michael S. Ensign, individually
and on behalf of his Investor Affiliates
and Investor Representatives
/s/ William A. Richardson
______________________________________________
William A. Richardson, individually
and on behalf of his Investor Affiliates
and Investor Representatives
/s/ David R. Belding
______________________________________________
David R. Belding, individually
and on behalf of his Investor Affiliates
and Investor Representatives
/s/ Peter A. Simon II
______________________________________________
Peter A. Simon II, individually
and on behalf of his Investor Affiliates
and Investor Representatives
/s/ Glenn W. Schaeffer
______________________________________________
Glenn W. Schaeffer, individually
and on behalf of his Investor Affiliates
and Investor Representatives
S-1
<PAGE>
EXHIBIT 99.5
================================================================================
REGISTRATION RIGHTS AGREEMENT
dated as of June 1, 1995
by and among
CIRCUS CIRCUS ENTERPRISES, INC.,
a Nevada corporation,
MICHAEL S. ENSIGN,
WILLIAM R. RICHARDSON,
DAVID R. BELDING,
PETER A. SIMON II,
GLENN W. SCHAEFFER,
GREGG H. SOLOMON,
ANTONIO C. ALAMO,
ANTHONY KORFMAN,
WILLIAM ENSIGN
and
ROBERT J. VERCHOTA
================================================================================
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
Page
----
<S> <C>
ARTICLE 1 DEFINITIONS....................................................... 1
ARTICLE 2 DEMAND REGISTRATIONS.............................................. 4
2.1 Timing and Number of Demand Registrations.......................... 4
2.2 Required Thresholds................................................ 5
2.3 Participation...................................................... 5
2.4 Managing Underwriter............................................... 5
ARTICLE 3 PIGGYBACK REGISTRATIONS........................................... 5
3.1 Participation...................................................... 5
3.2 Underwriter's Cutback.............................................. 5
3.3 Company Control.................................................... 6
ARTICLE 4 HOLD-BACK AGREEMENTS.............................................. 6
4.1 By Holders......................................................... 6
4.2 By the Company and Others.......................................... 6
ARTICLE 5 REGISTRATION PROCEDURES........................................... 7
ARTICLE 6 REGISTRATION EXPENSES............................................. 9
ARTICLE 7 INDEMNIFICATION................................................... 9
7.1 Indemnification by Company......................................... 9
7.2 Indemnification Procedures......................................... 10
7.3 Indemnification by Holder.......................................... 10
7.4 Contribution....................................................... 11
ARTICLE 8 REQUIREMENTS FOR PARTICIPATION IN UNDERWRITTEN OFFERINGS.......... 12
ARTICLE 9 SUSPENSION OF SALES............................................... 12
ARTICLE 10 MISCELLANEOUS..................................................... 12
10.1 No Inconsistent Agreements......................................... 12
10.2 Entire Agreement................................................... 12
10.3 No Third-Party Beneficiaries....................................... 12
10.4 Notices............................................................ 12
10.5 No Assignment; Binding Effect...................................... 13
10.6 Severability....................................................... 13
10.7 Governing Law...................................................... 13
10.8 Counterparts....................................................... 13
</TABLE>
<PAGE>
REGISTRATION RIGHTS AGREEMENT
-----------------------------
THIS REGISTRATION RIGHTS AGREEMENT, dated as of June 1, 1995 (this
"Agreement"), is made and entered into by and among CIRCUS CIRCUS ENTERPRISES,
INC., a Nevada corporation (the "Company"), and each of MICHAEL S. ENSIGN, an
individual ("M. Ensign"), WILLIAM A. RICHARDSON, an individual ("Richardson"),
DAVID R. BELDING, an individual ("Belding"), PETER A. SIMON II, an individual
("Simon"), GLENN W. SCHAEFFER, an individual ("Schaeffer"), GREGG H. SOLOMON, an
individual ("Solomon"), ANTONIO C. ALAMO, an individual ("Alamo"), ANTHONY
KORFMAN, an individual ("Korfman"), WILLIAM ENSIGN, an individual ("W. Ensign")
and ROBERT J. VERCHOTA, an individual ("Verchota" and collectively with all
other individuals party hereto, the "Investors").
RECITALS
--------
WHEREAS, the Company, M. Ensign, Richardson, Belding, Simon, Verchota, and
certain other parties, are entering into an Agreement and Plan of Merger, dated
as of March 19, 1995, as amended (the "Agreement and Plan of Merger");
WHEREAS, the Company, Schaeffer, Solomon, Alamo, Korfman, W. Ensign and
certain other parties are entering into an Exchange Agreement dated as of March
19, 1995 (the "Exchange Agreement"); and
WHEREAS, in order to induce certain parties to enter into the Agreement and
Plan of Merger and the Exchange Agreement and to consummate the transactions
contemplated thereby, each of the Investors and the Company has agreed to enter
into this Agreement.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
ARTICLE 1
DEFINITIONS
The following capitalized terms shall have the following meanings:
"BOARD" shall mean the Board of Directors of the Company.
"CLAIM" shall mean any loss, claim, damages, liability or expense
(including the reasonable costs of investigation and legal fees and expenses).
"COMMON STOCK" shall mean the common stock, par value $.01 2/3 (one
cent and two-thirds cents) per share, of the Company.
<PAGE>
"DEMAND GROUP" shall mean all Demand Persons.
"DEMAND PERSON" shall mean each of M. Ensign, Richardson and Belding,
so long as such Demand Person is a Holder.
"DEMAND REGISTRATION" shall mean a registration pursuant to Article 2
hereof.
"EQUITY SECURITY" shall mean any capital stock of the Company or any
security convertible, with or without consideration, into any such stock, or any
security carrying any warrant or right to subscribe to or purchase any such
stock, or any such warrant or right.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and the rules and regulations promulgated pursuant
thereto.
"EXCHANGEABLE PREFERRED STOCK" shall mean the Exchangeable Preferred
Stock, no par value, issued to Schaeffer, Solomon, Alamo, Korfman and W. Ensign
pursuant to the Exchange Agreement.
"FIRM COMMITMENT UNDERWRITTEN OFFERING" shall mean an offering in
which the underwriters agree to purchase securities for distribution pursuant to
a registration statement under the Securities Act and in which the obligation of
the underwriters is to purchase all the securities being offered if any are
purchased.
"FIRST DEMAND REGISTRATION STATEMENT" shall have the meaning set forth
in Section 2.1 hereof.
"HOLDER" shall mean each Investor, so long as such Investor is the
beneficial owner of Registrable Securities.
"INDEMNIFIED HOLDER" shall mean any Holder, any officer, director,
employee or agent of any such Holder and any Person who controls any of the
foregoing Persons within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act; provided, however, that no Person who was an
officer, director or employee of the Company at the time of the effectiveness of
any Registration Statement shall be an Indemnified Holder.
"MISSTATEMENT" shall mean an untrue statement of a material fact or an
omission to state a material fact required to be stated in a Registration
Statement or Prospectus or necessary to make the statements in a Registration
Statement, Prospectus or preliminary prospectus not misleading.
"PERSON" shall mean a natural person, partnership, corporation,
business trust, association, joint venture or other entity or a government or
agency or political subdivision thereof.
"PIGGYBACK REGISTRATION" shall mean a registration pursuant to Article
3 hereof.
2
<PAGE>
"PROSPECTUS" shall mean the prospectus included in any Registration
Statement, as supplemented by any and all prospectus supplements and as amended
by any and all post-effective amendments and including all material incorporated
by reference in such prospectus.
"REGISTRATION" shall mean a Demand Registration or a Piggyback
Registration.
"REGISTRATION EXPENSES" shall mean the out-of-pocket expenses of the
Company in connection with a Registration, including:
(1) all registration and filing fees (including fees with
respect to filings required to be made with the National Association of
Securities Dealers);
(2) fees and expenses of compliance with securities or blue
sky laws (including fees and disbursements of counsel for the underwriters
in connection with blue sky qualifications of the Registrable Securities
and determinations of their eligibility for investment under the laws of
such jurisdictions as the managing underwriters may designate);
(3) printing expenses;
(4) fees and disbursements of counsel for the Company and
counsel for the underwriters;
(5) fees and disbursements of all independent certified public
accountants of the Company incurred specifically in connection with such
Registration;
(6) fees and disbursements of underwriters (excluding
discounts, commissions or fees of underwriters, selling brokers, dealer
managers or similar securities industry professionals relating to the
distribution of the Registrable Securities); and
(7) fees and expenses of any other Persons retained by the
Company.
"REGISTRABLE SECURITIES" shall mean all shares of Common Stock issued
to the Investors pursuant to the Agreement and Plan of Merger, any shares of
Common Stock issued in exchange for the Exchangeable Preferred Stock, and any
securities issued with respect to such Common Stock by way of a stock dividend
or stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or reorganization; provided that any such Common Stock or
any such securities shall be deemed to be Registrable Securities only if and so
long as it is a Transfer Restricted Security.
"REGISTRATION STATEMENT" shall mean any registration statement which
covers Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus included in such registration statement, amendments
(including post-effective amendments) and supplements to such registration
statement, and all exhibits to and all material incorporated by reference in
such registration statement.
3
<PAGE>
"SECOND DEMAND REGISTRATION STATEMENT" shall have the meaning set
forth in Section 2.1 hereof.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended
from time to time, and the rules and regulations promulgated pursuant thereto.
"SEC" shall mean the Securities and Exchange Commission.
"TERMINATED WITHOUT CAUSE BY THE COMPANY OR WITH GOOD REASON BY SUCH
DEMAND PERSON" shall mean the termination of the employment of a Demand Person
by the Company without cause or by such Demand Person with good reason pursuant
to Section 5(a) of the Employment Agreement dated as of the date first above
written by and between the Company and such Demand Person.
"THIRD DEMAND REGISTRATION STATEMENT" shall have the meaning set forth
in Section 2.1 hereof.
"TRANSFER RESTRICTED SECURITY" shall mean a security that has not been
sold to or through a broker, dealer or underwriter in a public distribution or
other public securities transaction or sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Rule 144 promulgated thereunder (or any successor rule). The foregoing
notwithstanding, a security shall remain a Transfer Restricted Security until
all stop transfer instructions or notations and restrictive legends with respect
to such security have been lifted or removed.
"UNDERWRITTEN REGISTRATION" or "UNDERWRITTEN OFFERING" shall mean a
registration in which securities of the Company are sold to an underwriter for
distribution to the public.
ARTICLE 2
DEMAND REGISTRATIONS
2.1 TIMING AND NUMBER OF DEMAND REGISTRATIONS. At any time after the first
anniversary of the date of this Agreement, a Demand Person may request in
writing (a "Demand Request") that the Company file a registration statement
under the Securities Act covering shares of Registrable Securities then
outstanding which are beneficially owned by the Demand Person and which are
specified in the Demand Request.
The Company shall be obligated to prepare, file and cause to become
effective pursuant to this Article 2 no more than two Registration Statements
(the first, if any, being referred to herein as the "First Demand Registration
Statement" and the second, if any, being referred to herein as the "Second
Demand Registration Statement"); provided, however, the Company shall be
obligated to prepare, file and cause to become effective a third Registration
Statement (the "Third Demand Registration Statement"), if at the time of the
Demand Request with respect to the Third Demand Registration Statement the
Demand Person making such Demand Request was Terminated Without Cause by the
Company or With Good Reason by such Demand Person. Notwithstanding the
foregoing, (i) no Demand Request shall be provided with respect to a Second
Demand Registration
4
<PAGE>
Statement or a Third Demand Registration Statement (and the Company shall not be
obligated to prepare, file and cause to become effective a Second Demand
Registration Statement or a Third Demand Registration Statement, respectively)
prior to the period ending eighteen months after the effectiveness of the First
Demand Registration Statement and prior to the period ending eighteen months
after the effectiveness of the Second Demand Registration Statement,
respectively, and (ii) a Demand Request that has been revoked by any Demand
Person shall be deemed a request for the purposes of calculating the number of
Registration Statements which have been prepared, filed and become effective
pursuant to this paragraph of Section 2.1, unless such Demand Person reimburses
the Company for all Registration Expenses incurred in connection with the
preparation of a Registration Statement pursuant to such Demand Request.
If a Demand Person requests that the Company effect a Demand
Registration and the Company furnishes to such Demand Person a copy of a
resolution of the Board certified by the Secretary of the Company stating that
in the good faith judgment of the Board it would be seriously detrimental to the
Company and its stockholders for such registration statement to be filed on or
before the date such filing would otherwise be required hereunder, the Company
shall have the right to defer such filing for a period of not more than 180 days
after receipt of the Demand Request from such Demand Person; provided that
during such time the Company may not file a registration statement (other than
on Form S-8 or any successor form thereto) for securities to be issued and sold
for its own account or that of anyone other than the Demand Group.
2.2 REQUIRED THRESHOLDS. The Company shall not be obligated to prepare,
file and cause to become effective pursuant to this Article 2 a Registration
Statement unless the proposed aggregate public offering price of the securities
to be included in such Demand Registration is at least $25 million. The Company
shall not be required to effect any Demand Registration unless the offering is
to be a Firm Commitment Underwritten Offering.
2.3 PARTICIPATION. The Company shall promptly give written notice to all
Holders upon receipt of a request for a Demand Registration pursuant to Section
2.1 above. The Company shall include in such Demand Registration the shares of
Registrable Securities for which it has received written requests to register
such shares within 30 days after such written notice has been given.
2.4 MANAGING UNDERWRITER. The managing underwriter or underwriters of any
underwritten public offering covered by a Demand Registration shall be selected
by the Company; provided, however, if no member of the Demand Group is a
director or officer of the Company, the Company's selection of such managing
underwriter or underwriters shall be subject to the approval of the Demand
Group, which approval shall not be unreasonably withheld.
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ARTICLE 3
PIGGYBACK REGISTRATIONS
3.1 PARTICIPATION. Each time after the first anniversary of the date of
this Agreement that the Company decides to file a registration statement under
the Securities Act (other than on Forms S-4 or S-8 or any successor form
thereto) covering the offer and sale by it or any of its security holders of any
of its Equity Securities, for money, the Company shall give written notice
thereof to all Holders. The Company shall include in such registration statement
the shares of Registrable Securities for which it has received written requests
to register such shares within 30 days after such written notice has been given.
If the registration statement is to cover an underwritten offering, such
Registrable Securities shall be included in the underwriting on the same terms
and conditions as the securities otherwise being sold through the underwriters.
3.2 UNDERWRITER'S CUTBACK. If, in the good faith judgment of the managing
underwriter of such offering, the inclusion of all of the shares of Registrable
Securities would adversely affect the successful marketing of a smaller number
of such shares, then (i) the managing underwriter shall provide written notice
of such judgment to all Holders requesting such inclusion and (ii) the number of
shares of Registrable Securities to be included in the offering (except for
shares to be issued by the Company in an offering initiated by the Company)
shall be reduced pro rata among Holders requesting such inclusion pursuant to a
Piggyback Registration and any other Persons requesting Common Stock to be
included in such Registration based upon the number of shares of Common Stock
and Registrable Securities owned by such Persons.
All shares so excluded from the underwritten public offering shall be
withheld from the market by the Holders thereof for a period (not to exceed 15
days prior to the effective date and 120 days thereafter) that the managing
underwriter reasonably determines is necessary in order to effect the
underwritten public offering.
3.3 COMPANY CONTROL. The Company may decline to file a Registration
Statement after giving notice to any Holder pursuant to Section 3.1 above, or
withdraw a Registration Statement after filing and after such notice, but prior
to the effectiveness thereof.
ARTICLE 4
HOLD-BACK AGREEMENTS
4.1 BY HOLDERS. Upon the written request of the managing underwriter of
any underwritten offering of the Company's securities, a Holder shall not sell,
make any short sale of, loan, grant any option for the purchase of, or otherwise
dispose of any Registrable Securities (other than those included in such
registration) without the prior written consent of such managing underwriter for
a period (not to exceed 15 days before the effective date and 120 days
thereafter) that such managing underwriter reasonably determines is necessary in
order to effect the underwritten public offering; provided that each of the
officers and directors of the Company shall have entered into substantially
similar holdback agreements with such managing underwriter covering at least the
same period.
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4.2 BY THE COMPANY AND OTHERS. The Company agrees:
(a) not to effect any public or private sale or distribution of its
Equity Securities during the 15-day period prior to, and during the 120-day
period after, the effective date of each underwritten offering made pursuant to
a Demand Registration or a Piggyback Registration, if so requested in writing by
the managing underwriter (except as part of such underwritten offering or
pursuant to registrations on Forms S-4 or S-8 or any successor form thereto),
and
(b) not to issue any Equity Securities other than for sale in a
registered public offering unless each of the Persons to which such securities
are issued has entered into a written agreement binding on its transferees not
to effect any public sale or distribution of such securities during such period,
including without limitation a sale pursuant to Rule 144 under the Securities
Act (except as part of such underwritten registration, if and to the extent
permitted hereunder).
ARTICLE 5
REGISTRATION PROCEDURES
If and whenever the Company is required to register Registrable Securities
in a Demand Registration or a Piggyback Registration, the Company will use its
best efforts to effect such registration to permit the sale of such Registrable
Securities in accordance with the intended plan of distribution thereof, and
pursuant thereto the Company will as expeditiously as possible:
(a) prepare and file with the SEC as soon as practicable a Registration
Statement with respect to such Registrable Securities and use its best efforts
to cause such Registration Statement to become effective and remain effective
until the Registrable Securities covered by such Registration Statement have
been sold; provided that the Company shall not be required to maintain the
effectiveness of any Registration Statement for more than 90 days after such
Registration Statement becomes effective; and provided, further, that before
filing a Registration Statement or Prospectus or any amendments or supplements
thereto, the Company shall furnish to the Holders of the Registrable Securities
covered by such Registration Statement and the underwriters, if any, draft
copies of all such documents proposed to be filed, which documents will be
subject to the review of such Holders and underwriters;
(b) prepare and file with the SEC such amendments to the Registration
Statement, and such supplements to the Prospectus, as may be required by the
rules, regulations or instructions applicable to the registration form used by
the Company or by the Securities Act to keep the Registration Statement
effective until all Registrable Securities covered by such Registration
Statement are sold in accordance with the intended plan of distribution set
forth in such Registration Statement or supplement to the Prospectus or for such
shorter period of time during which such Registration Statement must be kept
effective by the terms of this Agreement;
(c) promptly notify the selling Holders and the managing underwriter, if
any, and (if requested by any such Person) confirm such advice in writing,
(1) when the Prospectus or any supplement or post-effective amendment
has been filed, and, with respect to the Registration Statement or any
post-effective amendment, when the same has become effective,
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(2) of any request by the SEC for amendments or supplements to the
Registration Statement or the Prospectus or for additional information,
(3) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose,
(4) of the receipt by the Company of any notification with respect to
the suspension of the qualification of the Registrable Securities for sale
in any jurisdiction or the initiation or threatening of any proceeding for
such purpose, and
(5) of the existence of any fact which results in the Registration
Statement, the Prospectus or any document incorporated therein by reference
containing a Misstatement;
(d) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible time;
(e) promptly prior to the filing of any document which is to be
incorporated by reference into the Registration Statement or the Prospectus
(after initial filing of the Registration Statement) provide copies of such
document to counsel to the selling Holders and to the managing underwriter, if
any;
(f) furnish to each selling Holder and the managing underwriter, without
charge, at least one signed copy of the Registration Statement and any
amendments thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those incorporated
by reference);
(g) deliver to each selling Holder and the underwriters, if any, without
charge, as many copies of each Prospectus (and each preliminary prospectus) as
such Persons may reasonably request (the Company hereby consenting to the use of
each such Prospectus (or preliminary prospectus) by each of the selling Holders
and the underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by such Prospectus (or preliminary prospectus));
(h) prior to any public offering of Registrable Securities, register or
qualify or cooperate with the selling Holders, the underwriters, if any, in
connection with the registration or qualification of such Registrable Securities
for offer and sale under the securities or blue sky laws of such jurisdictions
as such selling Holders or underwriters may designate and do anything else
necessary or advisable to enable the disposition in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided that the
Company shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which would
subject it to general service of process in any such jurisdiction where it is
not then so subject;
(i) cooperate with the selling Holders and the managing underwriter, if
any, to facilitate the timely preparation and delivery of certificates not
bearing any restrictive legends representing the Registrable Securities to be
sold and cause such Registrable Securities to be in such denominations and
registered in such names as the managing underwriter may request at least three
business days prior to any sale of Registrable Securities to the underwriters;
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<PAGE>
(j) use its best efforts to cause the Registrable Securities 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 seller or
sellers thereof or the underwriters, if any, to consummate the disposition of
such Registrable Securities;
(k) if the Registration Statement or the Prospectus contains a
Misstatement, prepare a supplement or amendment to the Registration Statement or
the related Prospectus or any document incorporated therein by reference or file
any other required document so that, as thereafter delivered to the purchasers
of the Registrable Securities, the Prospectus will not contain a Misstatement;
(l) provide a CUSIP number for all Registrable Securities not later than 3
business days prior to the effective date of the Registration Statement;
(m) enter into such agreements (including an underwriting agreement) and do
anything else necessary or advisable in order to expedite or facilitate the
disposition of such Registrable Securities; and
(n) otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC, and make generally available to its security holders
earnings statements satisfying the provisions of Section 11(a) of the Securities
Act, no later than 45 days after the end of any 12-month period (or 90 days, if
such period is a fiscal year) (x) commencing at the end of any fiscal quarter in
which Registrable Securities are sold to underwriters in an underwritten
offering, or, if not sold to underwriters in such an offering, (y) beginning
with the first month of the Company's first fiscal quarter commencing after the
effective date of the Registration Statement, which statements shall cover said
12-month periods.
ARTICLE 6
REGISTRATION EXPENSES
The Company shall bear all Registration Expenses incurred in
connection with any Registration, except as set forth in Section 2.1 and the
fees and disbursements of counsel to the selling security holders shall be paid
by such holders. Notwithstanding the foregoing, if (i) any Holder requests that
shares of Registrable Securities be registered, whether in connection with a
Demand Registration pursuant to Article 2 or in connection with a Piggyback
Registration pursuant to Article 3, and (ii) such Holder later requests that a
lesser number of such shares be registered after the registration and filing
fees with respect to such greater number of shares has been paid, then such
Holder shall pay such registration and filing fees with respect to the number of
shares which such Holder requested be withdrawn from registration and which
number of shares are thereafter not included in such registration (whether
registered on behalf of the Company or any other Person requesting
registration).
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ARTICLE 7
INDEMNIFICATION
7.1 INDEMNIFICATION BY COMPANY. The Company agrees to indemnify and hold
harmless each Indemnified Holder from and against all Claims arising out of or
based upon any Misstatement or alleged Misstatement, except insofar as such
Misstatement or alleged Misstatement was based upon information furnished in
writing to the Company by such Indemnified Holder expressly for use in the
document containing such Misstatement or alleged Misstatement. This indemnity
shall not be exclusive and shall be in addition to any liability which the
Company may otherwise have.
The foregoing notwithstanding, the Company shall not be liable to an
Indemnified Holder to the extent that any such Claim arises out of or is based
upon a Misstatement or alleged Misstatement in a Prospectus, if (i) such Claim
is asserted by a Person (other than an underwriter participating in the offering
to which such Prospectus relates) who purchased a Registrable Security from such
Indemnified Holder, (ii) such Misstatement or alleged Misstatement was corrected
in an amendment or supplement to such Prospectus, and (iii) having previously
been furnished by or on behalf of the Company with copies of the Prospectus as
so amended or supplemented, such Indemnified Holder thereafter failed to deliver
such Prospectus as so amended or supplemented prior to or concurrently with the
sale to such Person who purchased a Registrable Security from such Indemnified
Holder and who is asserting such Claim.
7.2 INDEMNIFICATION PROCEDURES. If any action or proceeding (including any
governmental investigation or inquiry) shall be brought or asserted against an
Indemnified Holder in respect of which indemnity may be sought from the Company,
such Indemnified Holder shall promptly notify the Company in writing, and the
Company shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to such Indemnified Holder and the payment of all
reasonable expenses in connection therewith.
Such Indemnified Holder shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such separate counsel shall be the expense of such
Indemnified Holder unless (i) the Company has agreed to pay such fees and
expenses, (ii) the Company shall have failed to assume the defense of such
action or proceeding or has failed to employ counsel reasonably satisfactory to
such Indemnified Holder in any such action or proceeding or (iii) the Company or
other Persons indemnified by the Company are parties to such action or
proceeding and such Indemnified Holder shall have been advised by counsel that
there may be one or more legal defenses available to such Indemnified Holder
that are different from or additional to those available to the Company or such
other Persons.
If such Indemnified Holder notifies the Company in writing that it
elects to employ separate counsel at the expense of the Company as permitted by
the provisions of the preceding paragraph, the Company shall not have the right
to assume the defense of such action or proceeding on behalf of such Indemnified
Holder. The foregoing notwithstanding, the Company shall not be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) at any time for such Indemnified Holder and any
other Indemnified Holders (which firm shall be designated in writing by such
Indemnified Holders) in connection with any one such action or proceeding or
separate but substantially similar or related actions or proceedings in the same
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jurisdiction arising out of the same general allegations or circumstances,
unless clause (iii) of the foregoing paragraph applies.
The Company shall not be liable for any settlement of any such action
or proceeding effected without its written consent, but if settled with its
written consent, or if there be a final judgment for the plaintiff in any such
action or proceeding, the Company agrees to indemnify and hold harmless such
Indemnified Holders from and against any loss or liability by reason of such
settlement or judgment.
7.3 INDEMNIFICATION BY HOLDER. Each Holder agrees to indemnify and hold
harmless the Company, its directors and officers and each Person, if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Holder, but only with respect to information
relating to such Holder furnished in writing by such Holder expressly for use in
any Registration Statement, Prospectus or preliminary prospectus. In no event,
however, shall the liability hereunder of any selling Holder be greater than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
In case any action or proceeding shall be brought against the Company
or its directors or officers or any such controlling person, in respect of which
indemnity may be sought against a Holder, such Holder shall have the rights and
duties given the Company and the Company or its directors or officers or such
controlling person shall have the rights and duties given to each Holder by
Sections 7.1 and 7.2 above.
The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, to the same extent as provided
above with respect to information so furnished in writing by such Persons
specifically for inclusion in any Prospectus or Registration Statement.
7.4 CONTRIBUTION. If the indemnification provided for in this Article 7 is
unavailable to an indemnified party under Section 7.1 or Section 7.3 above
(other than by reason of exceptions provided in those Sections) in respect of
any Claims referred to in such Sections, then each applicable indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such Claims in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the Indemnified Holder on the other in connection with
the statements or omissions which resulted in such Claims as well as any other
relevant equitable considerations. The amount paid or payable by a party as a
result of the Claims referred to above shall be deemed to include, subject to
the limitations set forth in Section 7.2, any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or defending
any action or claim.
The relative fault of the Company on the one hand and of the
Indemnified Holder on the other shall be determined by reference to, among other
things, whether the Misstatement or alleged Misstatement relates to information
supplied by the Company or by the Indemnified Holder and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such Misstatement or alleged Misstatement.
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The Company and each Holder agree that it would not be just and
equitable if contribution pursuant to this Section 7.4 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.
Notwithstanding the provisions of this Section 7.4, an Indemnified
Holder shall not be required to contribute any amount in excess of the amount by
which (i) the total price at which the securities that were sold by such
Indemnified Holder and distributed to the public were offered to the public
exceeds (ii) the amount of any damages which such Indemnified Holder has
otherwise been required to pay by reason of such Misstatement.
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.
ARTICLE 8
REQUIREMENTS FOR PARTICIPATION IN UNDERWRITTEN OFFERINGS
No Person may participate in any underwritten offering pursuant to a
Registration hereunder unless such Person (a) agrees to sell such Person's
securities on the basis provided in any underwriting 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.
ARTICLE 9
SUSPENSION OF SALES
Upon receipt of written notice from the Company that a Registration
Statement or Prospectus contains a Misstatement, each Holder shall forthwith
discontinue disposition of Registrable Securities until such Holder has received
copies of the supplemented or amended Prospectus required by Article 5 hereof,
or until such Holder is advised in writing by the Company that the use of the
Prospectus may be resumed, and, if so directed by the Company, such Holder shall
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in such Holder's possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice. In the event the Company shall give any such notice, the 90-day period
referred to in Article 5 hereof shall be extended by the number of days during
the period from and including the date of the giving of such notice to and
including the date when each seller of Registrable Securities covered by such
Registration Statement either has received the copies of the supplemented or
amended prospectus contemplated by Article 5 hereof or has been advised in
writing by the Company that the use of the Prospectus may be resumed.
ARTICLE 10
MISCELLANEOUS
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10.1 NO INCONSISTENT AGREEMENTS. The Company shall not on or after the date
of this Agreement enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof.
10.2 ENTIRE AGREEMENT. This Agreement, including all exhibits and schedules
hereto, contains the sole and entire agreement among the parties with respect to
the subject matter hereof and supersedes any and all prior agreements,
understandings, negotiations and discussions, whether oral or written, among the
parties hereto with respect to such subject matter.
10.3 NO THIRD-PARTY BENEFICIARIES. The terms and provisions of this
Agreement are intended for the benefit of each party hereto and their respective
successors and permitted assigns, and it is not the intention of the parties to
confer third-party beneficiary rights upon any other Person (except as provided
in Article 7).
10.4 NOTICES. Unless otherwise specifically provided herein, all notices,
demands, consents, waivers and other communications required or permitted by the
terms of this Agreement shall be in writing, and any notice shall become
effective three (3) days after deposit in the United States mails, first class
postage prepaid, or one (1) day after delivery to an overnight courier or
express company or immediately upon delivery by hand or in the form of telecopy,
telegram or other electronic means of communication that produces a written
copy, and, if mailed or delivered by courier, express company or hand, shall be
addressed as indicated in Section 9.3 of the Agreement and Plan of Merger or
Section 6.8 of the Exchange Agreement, as the case may be.
10.5 NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any right,
interest, duty or obligation hereunder may be assigned by the Company or any
Holder without, in the case of the Company, the prior written consent of the
Holders of a majority of the Registrable Securities and, in the case of any
Holder, the prior written consent of the Company and the Holders of a majority
of the Registrable Securities, and any attempt to assign this Agreement or any
right, interest, duty or obligation hereunder without such prior written consent
shall be null and void. Subject to the preceding sentence, this Agreement is
binding upon, inures to the benefit of and is enforceable by the parties hereto
and their respective successors and assigns.
10.6 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (i) such provision will be fully
severable, (ii) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
and (iii) the remaining provisions of this Agreement will remain in full force
and effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance from this Agreement.
10.7 GOVERNING LAW. This Agreement has been negotiated and executed and
shall be performed in the State of Nevada and shall be governed and construed by
the laws of such State, without giving effect to the conflicts of laws
principles thereof.
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10.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
[Signature pages to follow]
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IN WITNESS WHEREOF, each party has executed this Agreement as of the date
first above written.
CIRCUS CIRCUS ENTERPRISES, INC.,
a Nevada corporation
By /s/ Clyde T. Turner
_______________________________________
Name: Clyde T. Turner
Title: President and Chief Executive
Officer
/s/ Michael S. Ensign
__________________________________________
Michael S. Ensign
/s/ William A. Richardson
__________________________________________
William A. Richardson
/s/ David R. Belding
__________________________________________
David R. Belding
/s/ Peter A. Simon II
__________________________________________
Peter A. Simon II
/s/ Glenn W. Schaeffer
__________________________________________
Glenn W. Schaeffer
/s/ Gregg H. Solomon
__________________________________________
Gregg H. Solomon
S-1
<PAGE>
/s/ Antonio C. Alamo
__________________________________________
Antonio C. Alamo
/s/ Anthony Korfman
__________________________________________
Anthony Korfman
/s/ William Ensign
__________________________________________
William Ensign
/s/ Robert J. Verchota
__________________________________________
Robert J. Verchota
S-2
