<PAGE>
As filed with the Securities and Exchange Commission on March 24, 2000
Registration No. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------
MGM GRAND, INC.
(Exact name of Registrant as specified in its charter)
--------------
<TABLE>
<S> <C>
Delaware 88-0215232
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
ADDITIONAL SUBSIDIARY GUARANTOR REGISTRANTS LISTED ON FOLLOWING PAGE
3799 Las Vegas Boulevard South
Las Vegas, Nevada 89109
(702) 891-3333
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
--------------
SCOTT LANGSNER
3799 Las Vegas Boulevard South
Las Vegas, Nevada 89109
(702) 891-3333
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
<TABLE>
<S> <C>
JANET S. MC CLOUD, ESQ. JONATHAN K. LAYNE, ESQ.
Christensen, Miller, Fink, Jacobs, Gibson, Dunn & Crutcher LLP
Glaser, Weil & Shapiro, LLP 333 S. Grand Avenue
2121 Avenue of the Stars, 18th Floor Los Angeles, California 90071
Los Angeles, California 90067
</TABLE>
--------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the securities being registered on this form are being offered pursuant
to dividend or interest investment plans, please check the following
box. [_] __________
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X] __________
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] __________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] __________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_] __________
CALCULATION OF REGISTRATION FEE
<TABLE>
- ------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------
<CAPTION>
Proposed Proposed
Amount maximum maximum
Title of each class of to be offering price aggregate Amount of
securities to be registered registered(1) per unit(2) offering price(1) registration fee
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities, Common Stock, $0.01 par
value, and Rights to Subscribe for the
Common Stock.............................. (2) (2) $2,750,000,000 $726,000(3)
Guarantees of Subsidiaries................. N/A N/A N/A N/A(4)
- ------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(1) In no event will the aggregate maximum offering price of all securities to
be registered pursuant to this Registration Statement, and not previously
registered, exceed $2.75 billion The securities registered hereunder may
be sold separately or together.
(2) Omitted pursuant to General Instruction II.D of Form S-3 under the
Securities Act.
(3) Calculated pursuant to Rule 457(o) of the Securities Act.
(4) No separate fee is payable pursuant to Rule 457(n).
--------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
ADDITIONAL REGISTRANTS
<TABLE>
<CAPTION>
(State or Other
Jurisdiction of (IRS Employee
(Exact Name of Registrant as Specified in its Incorporation or Identification
Charter) Organization) Number)
--------------------------------------------- ---------------- --------------
<S> <C> <C>
MGM GRAND HOTEL, INC. ........................ Nevada 88-0108587
MGM GRAND MOVIEWORLD, INC. ................... Nevada 88-0260416
GRAND LAUNDRY, INC. .......................... Nevada 88-0298834
MGM GRAND MONORAIL, INC. ..................... Nevada 88-0303364
MGM DIST., INC. .............................. Nevada 88-0230514
DESTRON, INC. ................................ Nevada 88-0234293
DESTRON MARKETING, INC. ...................... Nevada 88-0330790
MGM GRAND MERCHANDISING, INC. ................ Nevada 88-0339740
MGM ENTERTAINMENT, INC. ...................... Nevada 88-0373099
MGM GRAND ATLANTIC CITY, INC. ................ New Jersey 88-0354792
MGM GRAND DEVELOPMENT, INC. .................. Nevada 88-0368826
MGMGMR ACQUISITION, INC. ..................... Nevada Applied For
</TABLE>
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and we are not soliciting offers to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED MARCH 24, 2000
PROSPECTUS
$2,750,000,000
MGM GRAND, INC.
Debt Securities, Common Stock
and Subscription Rights
-----------
We may use this prospectus to offer and sell from time to time, separately or
together, one or more series of our debt securities, consisting of debentures,
notes, bonds or other evidences of indebtedness, shares of our common stock and
subscription rights. These securities will have an aggregate initial public
offering price not to exceed $2,750,000,000 and will be offered and sold at
prices and on terms to be determined at the time of sale. The terms of any
offering will be set forth in one or more prospectus supplements to this
prospectus. We anticipate that we may offer to sell $1.2 billion of our common
stock in connection with our merger acquisition of Mirage Resorts,
Incorporated.
If we offer our common stock and/or subscription rights, the prospectus
supplement will also set forth the total number of shares offered, the offering
price and the terms of the offering. Should we offer common stock, Tracinda
Corporation, our principal stockholder, has advised us that it will purchase at
least $600 million of that offering directly from us. Our common stock trades
on the New York Stock Exchange under the symbol "MGG." On March 23, 2000, the
closing price of our common stock was $21.00 per share. Any subscription rights
we issue will be transferable, and we anticipate that the rights will be
authorized for trading on the NYSE.
If the offering is for debt securities, the prospectus supplement will set
forth the specific title, series, total principal amount, maturity, interest
rate (or the way interest is to be calculated), time of payment of interest,
whether the debt securities are to be represented by certificates, authorized
denominations, terms for redemption, sinking fund requirements, guarantees by
our subsidiaries, covenants and the initial public offering price. The
prospectus supplement will also contain information, where applicable, about
certain U.S. federal income tax considerations relating to the offered
securities.
-----------
Neither the Securities and Exchange Commission nor any state securities
regulators or gaming regulatory authorities have approved or disapproved of
these securities or determined if this prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
-----------
None of the Nevada Gaming Commission, the Nevada State Gaming Control Board,
the New Jersey Casino Control Commission, the Michigan Gaming Control Board,
the Mississippi Commission nor any other gaming authority has passed upon the
accuracy or adequacy of this prospectus or the investment merits of the
securities offered. Any representation to the contrary is unlawful.
-----------
The Attorney General of the State of New York has not passed upon or endorsed
the merits of this offering. Any representation to the contrary is unlawful.
We may sell all or a portion of the offered securities directly, through
agents designated from time to time or to or through underwriters or dealers.
If any agents or underwriters are involved in the sale of the offered
securities, their names and any applicable purchase price, fee, commission or
discount arrangement between or among them, will be set forth, or will be
calculable from the information set forth, in the prospectus supplement. See
"Plan of Distribution." We will not sell any offered securities without
delivering a prospectus supplement describing the method and terms of the
offering of the offered securities.
The date of this prospectus is , 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
About This Prospectus.................................................... 2
Forward Looking Statements............................................... 2
The Company.............................................................. 3
Use of Proceeds.......................................................... 4
Ratio of Earnings to Fixed Charges....................................... 4
Summary Historical Financial Data........................................ 5
Summary Unaudited Pro Forma Data......................................... 6
Comparative Historical and Pro Forma Selected Consolidated Financial
Data.................................................................... 7
Unaudited Proforma Financial Statements.................................. 8
Description of Our Long Term Debt........................................ 12
Description of Debt Securities........................................... 17
Description of Common Stock.............................................. 24
Plan of Distribution..................................................... 25
Legal Matters............................................................ 26
Experts.................................................................. 26
Where You Can Find More Information...................................... 26
Incorporation of Certain Information by Reference........................ 27
</TABLE>
----------------
ABOUT THIS PROSPECTUS
This prospectus is part of a Registration Statement that we filed with the
Securities and Exchange Commission using a "shelf" registration process. Under
this shelf process, we may from time to time over approximately the next two
years, sell any combination of the securities described in this prospectus in
one or more offerings up to a total dollar amount of $2,750,000,000. This
prospectus provides you with a general description of the securities we may
offer. Each time we sell securities, we will provide a prospectus supplement
that will contain specific information about the terms of that offering. The
prospectus supplement also may add, update or change information contained in
this prospectus. You should read both this prospectus and any prospectus
supplement together with additional information described under the heading
"Where You Can Find More Information" on page 26 below.
You should rely only on the information or representations incorporated by
reference or provided in this prospectus and in the accompanying prospectus
supplement. We have not authorized anyone to provide you with different
information. You may obtain copies of the Registration Statement, or any
document which we have filed as an exhibit to the Registration Statement or to
any other SEC filing, either from the SEC or from the Secretary of the company
as described under "Where You Can Find More Information" below. We are not
making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this prospectus or in
the accompanying prospectus supplement is accurate as of any date other than
the dates printed on the front of each such document.
FORWARD-LOOKING STATEMENTS
This prospectus contains or incorporates by reference forward-looking
statements, within the meaning of Section 27A of the Securities Act and
Section 21E of the Securities Exchange Act. Forward-looking statements
typically can be identified by the use of forward-looking words, such as
"may," "will," "could," "project," "believe," "anticipate," "expect,"
"estimate," "continue," "potential," "plan," "intend," "forecast" and the
like. These statements appear in a number of places, both in this prospectus
and in the information incorporated by reference and include statements
regarding our current intentions, plans, strategies, beliefs and expectations.
Forward-looking statements do not guarantee future performance and involve
risks and uncertainties that could cause actual results to differ materially
from those anticipated. The information contained in this prospectus,
including the information incorporated by reference, identifies important
factors that could cause such differences.
2
<PAGE>
THE COMPANY
We are a leading operator of first class hotel and casino properties with
an emphasis on the total gaming and entertainment experience. We own and
operate the MGM Grand Las Vegas and the New York-New York Hotel and Casino,
two of the most prominent hotel/casinos on the Las Vegas Strip. We believe the
MGM Grand Las Vegas is one of the largest hotel/casinos in the world with
approximately 5,000 rooms, 171,500 square feet of gaming space and one of the
largest arenas in Las Vegas. We have completed an approximate $570 million
master plan to expand and transform the MGM Grand Las Vegas into "The City of
Entertainment." Our New York-New York property has 2,024 hotel rooms and
84,000 square feet of gaming space. In Primm, Nevada, we own and operate the
three hotel/casinos that travelers first encounter on the principal route from
Southern California to Las Vegas. On July 29, 1999, we opened the MGM Grand
Detroit interim casino in Detroit, Michigan. We also own and operate the MGM
Grand Hotel and Casino in Darwin, Australia and operate three casinos in South
Africa. We have also announced plans to develop a casino resort in Atlantic
City, New Jersey.
Recent Developments
On December 13, 1999, our board of directors approved a two-for-one split
of our common stock and declared a quarterly cash dividend of $.10 per share,
after giving effect to the stock split. The additional shares were distributed
on February 25, 2000 to stockholders of record on February 10, 2000. The cash
dividend was paid on March 1, 2000 to stockholders of record on February 10,
2000. All references to share and per share data in this prospectus have been
adjusted retroactively to give effect to the stock split. At the same time,
our board of directors increased the number of authorized shares of our common
stock from 75 million shares to 300 million shares.
On March 6, 2000, we announced the signing of a definitive merger agreement
with Mirage Resorts, Incorporated, under which we will acquire all of the
outstanding shares of Mirage for $21 per share in cash. The transaction will
have a total equity value of approximately $4.4 billion. In addition, Mirage
has outstanding debt of approximately $2.0 billion. The transaction is subject
to the approval of Mirage shareholders and to the satisfaction of customary
closing conditions contained in the merger agreement, including the receipt of
all necessary regulatory and governmental approvals. The transaction will be
accounted for as a purchase and is anticipated to close in 2000. As a result
of the merger, Mirage will become our wholly owned subsidiary.
Mirage is a leading owner, developer and operator of casino-based resorts.
It owns and operates Bellagio, Mirage and Treasure Island on the Las Vegas
Strip; Golden Nugget in downtown Las Vegas; Golden Nugget-Laughlin in
Laughlin, Nevada; and Beau Rivage in Biloxi, Mississippi. Mirage also owns a
50% interest in a joint venture which owns and operates the Monte Carlo Resort
& Casino on the Las Vegas Strip. Mirage also intends to expand into the
Atlantic City, New Jersey market, where it owns land. For more information
about us and Mirage, see "Where You Can Find More Information" on page 26
below.
3
<PAGE>
USE OF PROCEEDS
Unless otherwise specified in the prospectus supplement which accompanies
this prospectus, our net proceeds from the sale of the offered securities will
be used to provide a portion of the cash needed to complete the Mirage merger
and for general corporate purposes, which may include financing the
development and construction of new facilities, additions to working capital,
reductions of our indebtedness, financing of capital expenditures, potential
acquisitions and the repurchase of our common stock. Funds not immediately
required for such purposes may be invested in short-term investment grade
securities.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for
the periods indicated:
<TABLE>
<CAPTION>
Year Ended December 31,
----------------------------
1995 1996 1997 1998 1999(2)
---- ---- ----- ---- -------
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges(1).............. 1.65 2.78 10.11 2.94 2.73
</TABLE>
- --------
(1) For purposes of computing the foregoing ratios: (a) earnings consist of
income from continuing operations before income taxes and fixed charges,
adjusted to exclude capitalized interest, and (b) fixed charges consist
of interest, whether expensed or capitalized, amortization of debt
discount and issuance costs, our proportionate share of the interest cost
of 50%-owned joint ventures (such as the limited liability company which
owns New York-New York, of which we have owned 100% since March 1, 1999)
and the estimated interest component of rental expense.
(2) The pro forma ratio of earnings to fixed charges for 1999, giving effect
to our acquisition of Mirage, is 1.23.
4
<PAGE>
SUMMARY HISTORICAL FINANCIAL DATA
MGM Grand and Mirage are providing the following financial information to
assist you in your analysis of the financial aspects of the merger. This
information is only a summary and you should read it in conjunction with the
historical financial statements and related notes contained in the annual
reports and other information that MGM Grand and Mirage have filed with the
Securities and Exchange Commission.
SUMMARY HISTORICAL FINANCIAL DATA OF MGM GRAND
(in thousands, except for per share data)
<TABLE>
<CAPTION>
At or for the year ended December 31,
------------------------------------------------------
1995 (A) 1996 (B) 1997 (C) 1998 1999 (D)
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net revenues............ $ 718,781 $ 800,189 $ 827,597 $ 773,863 $1,391,650
Operating income........ 103,823 129,294 190,970 131,574 209,868
Net income before
extraordinary items and
cumulative effect of
change in accounting
principle.............. 46,565 74,517 115,256 68,948 95,124
Cash dividends per
common share........... -- -- -- -- --
Diluted earnings per
share before non-
recurring charges,
extraordinary items and
cumulative effect of
change
in accounting
principle.............. $ 0.52 $ 1.03 $ 1.14 $ 0.61 $ 1.19
Diluted earnings per
share before
extraordinary items and
cumulative effect of
change in accounting
principle.............. $ 0.48 $ 0.68 $ 0.98 $ 0.61 $ 0.80
Weighted average common
and common equivalent
shares outstanding..... 97,088 108,514 117,670 112,684 120,086
Total assets............ $1,275,883 $1,275,121 $1,389,816 $1,768,958 $2,760,743
Long-term debt
(including current
portion)............... 551,099 83,391 57,830 544,874 1,318,841
Stockholders' equity.... 584,548 973,382 1,101,622 964,381 1,033,846
SUMMARY HISTORICAL FINANCIAL DATA OF MIRAGE
(in thousands, except for per share data)
<CAPTION>
At or for the year ended December 31,
------------------------------------------------------
1995 1996 1997 1998 (E) 1999 (F)
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net revenues............ $1,330,744 $1,367,544 $1,418,551 $1,523,729 $2,431,837
Operating income........ 284,087 312,670 326,041 152,105 305,027
Net income before
extraordinary items and
cumulative effect of
change in accounting
principle.............. 169,948 206,045 209,803 85,225 140,968
Cash dividends per
common share........... -- -- -- -- --
Diluted earnings per
share before non-
recurring charges,
extraordinary items and
cumulative effect of
change
in accounting
principle.............. $ 0.88 $ 1.05 $ 1.09 $ 0.75 $ 0.84
Diluted earnings per
share before
extraordinary items and
cumulative effect of
change in accounting
principle.............. $ 0.88 $ 1.05 $ 1.09 $ 0.45 $ 0.70
Weighted average common
and common equivalent
shares outstanding..... 192,331 196,683 192,536 190,964 200,240
Total assets............ $1,791,713 $2,143,490 $3,347,350 $4,530,202 $4,804,306
Long-term debt
(including current
portion)............... 249,063 468,593 1,397,655 2,378,911 2,210,279
Stockholders' equity.... 1,209,343 1,290,883 1,512,484 1,601,837 2,023,902
</TABLE>
- --------
(A) Includes a $5,942,000 pre-tax write-down for restructuring costs.
(B) Includes a $49,401,000 pre-tax write-down for the master plan asset
disposition and a $7,868,000 pre-tax charge for New York-New York hotel
preopening costs.
(C) Includes a $28,566,000 pre-tax write-down for the master plan asset
disposition.
(D) Includes a $71,495,000 pre-tax charge for MGM Grand Detroit, the Mansion
at the MGM Grand Las Vegas, and MGM Grand Atlantic City hotel preopening
costs as well as certain tender related costs.
(E) Includes a $88,313,000 pre-tax charge for Bellagio hotel preopening costs.
(F) Includes a $42,130,000 pre-tax charge for Beau Rivage hotel preopening
costs.
5
<PAGE>
SUMMARY UNAUDITED PRO FORMA DATA
The Mirage merger will be accounted for as a "purchase," which means that
the purchase price will be allocated to assets acquired and liabilities
assumed based on their estimated fair values at the time the companies are
combined. We are providing the following financial information to assist you
in your analysis of the financial aspects of the Mirage merger. We derived
this information from audited financial statements for 1999 for both MGM Grand
and Mirage. The information is only a summary of the unaudited pro forma
financial information presented on pages 8 to 11 and you should read it in
conjunction with our historical financial statements (and related notes)
contained in the annual reports and other information that we have filed with
the Securities and Exchange Commission.
While this pro forma financial information has been prepared based upon
currently available information using assumptions which we believe are
appropriate, you should be aware that this pro forma information may not be
indicative of what actual results will be in the future or would have been for
the periods presented. You should read the notes to the unaudited pro forma
financial information beginning on page 10 for further discussion of the
assumptions we made to prepare this information.
PRO FORMA INCOME DATA:
<TABLE>
<CAPTION>
For the year ended
December 31, 1999
---------------------
(In thousands, except
per share amounts)
<S> <C>
Net revenues............................................. $ 3,823,487
Operating income......................................... 574,836
Net income before extraordinary items and cumulative
effect of change in accounting principle................ 140,065
Diluted earnings per share before non-recurring charges,
extraordinary items and cumulative effect of change in
accounting principle.................................... 1.23
Diluted earnings per share before extraordinary items and
cumulative effect of change in accounting principle..... 0.81
Cash dividends per common share.......................... --
Weighted average common and common equivalent shares
outstanding............................................. 173,874
PRO FORMA BALANCE SHEET DATA:
<CAPTION>
At December 31, 1999
---------------------
(In thousands)
<S> <C>
Total assets............................................. $10,991,815
Long-term debt (including current portion)............... 6,730,531
Stockholders' equity..................................... 2,197,846
</TABLE>
6
<PAGE>
COMPARATIVE HISTORICAL AND PRO FORMA SELECTED
CONSOLIDATED FINANCIAL DATA
We have summarized below the per share information of MGM Grand and Mirage
on a historical and pro forma combined basis. Mirage stockholders will receive
$21 from MGM Grand in exchange for each share of Mirage common stock. The
information set forth below is only a summary, and you should read it in
conjunction with the historical financial statements and related notes
contained in the annual reports and other information that MGM Grand and
Mirage have filed with the Securities and Exchange Commission.
<TABLE>
<CAPTION>
MGM Grand Mirage MGM Grand
Historical Historical Pro Forma
---------- ---------- ---------
<S> <C> <C> <C>
Income per diluted share before non-recurring
charges, extraordinary items and cumulative
effect of change in accounting principle (1):
Year ended December 31, 1999................ $1.19 $0.84 $1.23
Income per diluted share before extraordinary
items and cumulative effect of change in
accounting principle (1):
Year ended December 31, 1999................ $0.80 $0.70 $0.81
Book value per share (2):
At December 31, 1999........................ 9.08 10.65 13.11
Cash dividends per share (3).................. -- -- --
</TABLE>
- --------
(1) The table above combines MGM Grand's results of operations for the fiscal
year ended December 31, 1999 with Mirage's results of operations for the
same period. The pro forma combined income per diluted share is based on
the combined weighted average number of common shares and common share
equivalents. Common share equivalents consist of common stock issuable
upon the exercise of outstanding options and warrants.
(2) Historical book value per share for both MGM Grand and Mirage was computed
by dividing total stockholders' equity at December 31, 1999 by the number
of common shares outstanding, excluding shares held in treasury, as of
those dates, respectively. MGM Grand pro forma book value per share was
computed by dividing pro forma stockholders' equity (See "Unaudited Pro
Forma Balance Sheet" on page 9) by the pro forma number of shares of MGM
Grand's common stock outstanding as of December 31, 1999 (without
including outstanding options). The pro forma number of shares of MGM
Grand's common stock outstanding was calculated as the sum of MGM Grand's
common stock outstanding and assuming an equity offering of $1.2 billion.
(3) Neither MGM Grand nor Mirage paid cash dividends during the periods
presented. MGM Grand paid a cash dividend of $0.10 per share on March 1,
2000 to shareholders of record on February 10, 2000.
7
<PAGE>
UNAUDITED PRO FORMA FINANCIAL STATEMENTS
MGM GRAND, INC.
UNAUDITED PRO FORMA STATEMENT OF INCOME
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
MGM Grand
MGM Grand Mirage Pro Forma as
Historical Historical Adjustments Adjusted
(Note 1) (Note 1) (Note 2) for Merger
---------- ---------- ----------- ----------
(In thousands, except per share amounts)
<S> <C> <C> <C> <C>
Revenues:
Casino..................... $ 873,781 $1,243,625 $ -- $2,117,406
Rooms...................... 251,207 522,566 -- 773,773
Food and beverage.......... 161,301 456,811 -- 618,112
Entertainment, retail and
other..................... 211,837 426,850 -- 638,687
Income from unconsolidated
affiliate................. 6,084 29,164 -- 35,248
---------- ---------- --------- ----------
1,504,210 2,679,016 -- 4,183,226
Less: Promotional
allowances................ 112,560 247,179 -- 359,739
---------- ---------- --------- ----------
1,391,650 2,431,837 -- 3,823,487
---------- ---------- --------- ----------
Expenses:
Casino..................... 417,491 690,179 -- 1,107,670
Rooms...................... 75,064 164,610 -- 239,674
Food and beverage.......... 100,871 314,689 -- 415,560
Entertainment, retail and
other..................... 119,324 300,052 -- 419,376
Provision for doubtful
accounts and discounts.... 47,157 31,911 -- 79,068
General and
administrative............ 209,938 328,390 (55,000)(a) 483,328
Depreciation and
amortization.............. 125,985 205,163 15,059 (b) 346,207
---------- ---------- --------- ----------
1,095,830 2,034,994 (39,941) 3,090,883
---------- ---------- --------- ----------
Operating Profit Before
Corporate Expense and
Preopening and Other...... 295,820 396,843 39,941 732,604
Preopening and other....... 71,495 42,130 -- 113,625
Corporate expense.......... 14,457 49,686 (20,000)(a) 44,143
---------- ---------- --------- ----------
Operating income........... 209,868 305,027 59,941 574,836
---------- ---------- --------- ----------
Nonoperating Income
(Expense):
Interest income............ 2,142 6,126 -- 8,268
Interest expense, net of
amounts capitalized....... (59,853) (117,525) (199,567)(c) (376,945)
Interest expense from
unconsolidated affiliate.. (1,058) -- -- (1,058)
Other, net................. (946) 24,462 -- 23,516
---------- ---------- --------- ----------
(59,715) (86,937) (199,567) (346,219)
---------- ---------- --------- ----------
Income Before Income Taxes,
Extraordinary Item and
Cumulative Effect of Change
in Accounting Principle.... 150,153 218,090 (139,626) 228,617
Provision for income
taxes..................... (55,029) (77,122) 43,599 (d) (88,552)
---------- ---------- --------- ----------
Income Before Extraordinary
Item and Cumulative Effect
of Change in Accounting
Principle.................. 95,124 140,968 (96,027) 140,065
Loss on early
extinguishment of debt,
net....................... (898) -- -- (898)
Cumulative effect of change
in accounting principle,
net....................... (8,168) (30,577) -- (38,745)
---------- ---------- --------- ----------
Net Income.................. $ 86,058 $ 110,391 $ (96,027) $ 100,422
========== ========== ========= ==========
Per Share of Common Stock:
Net Income per Basic Share
Before Non-Recurring
Items, Extraordinary Item
and Cumulative Effect of
Change in Accounting
Principle................. $ 1.22 $ 1.26
Preopening and Other....... (0.40) (0.43)
---------- ----------
Net Income per Basic Share
Before Extraordinary Item
and Cumulative Effect of
Change in Accounting
Principle................. 0.82 0.83
Extraordinary Item......... (0.01) (0.01)
Cumulative Effect of Change
in Accounting Principle... (0.07) (0.23)
---------- ----------
Net Income per Basic
Share..................... $ 0.74 $ 0.59
========== ==========
Net Income per Diluted
Share Before Non-Recurring
Items, Extraordinary Item
and Cumulative Effect of
Change in Accounting
Principle................. $ 1.19 $ 1.23
Preopening and Other....... (0.39) (0.42)
Net Income per Diluted
Share Before
Extrtaordinary Item and
Cumulative Effect of
Change in Accounting
Principle................. 0.80 0.81
Extraordinary Item......... (0.01) (0.01)
Cumulative Effect of Change
in Accounting Principle... (0.07) (0.22)
---------- ---------- --------- ----------
Net Income per Diluted
Share..................... $ 0.72 $ 0.58
========== ==========
Basic Shares Outstanding... 116,580 53,788 (e) 170,368
========== ========= ==========
Diluted Shares
Outstanding............... 120,086 53,788 (e) 173,874
========== ========= ==========
</TABLE>
8
<PAGE>
MGM GRAND, INC.
UNAUDITED PRO FORMA BALANCE SHEET
AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
MGM Grand Mirage Pro Forma MGM Grand
Historical Historical Adjustments as Adjusted
(Note 1) (Note 1) (Note 3) for Merger
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash
equivalents............. $ 121,522 $ 139,488 $ -- $ 261,010
Accounts receivable,
net..................... 83,101 181,357 -- 264,458
Prepaid expenses and
other................... 32,598 35,948 -- 68,546
Inventories.............. 15,240 94,351 -- 109,591
Deferred tax asset....... 17,452 24,558 -- 42,010
---------- ---------- ----------- -----------
Total current assets... 269,913 475,702 -- 745,615
---------- ---------- ----------- -----------
PROPERTY AND EQUIPMENT,
NET...................... 2,390,524 4,095,217 2,628,543 (f) 9,114,284
OTHER ASSETS:
Investments in
unconsolidated
affiliates.............. 12,485 118,221 228,750 (g) 359,456
Excess of purchase price
over fair market value
of net assets acquired,
net..................... 36,550 6,912 515,451 (h) 558,913
Deposits and other
assets, net............. 51,271 108,254 54,022 (i) 213,547
---------- ---------- ----------- -----------
Total other assets..... 100,306 233,387 798,223 1,131,916
---------- ---------- ----------- -----------
$2,760,743 $4,804,306 $ 3,426,766 $10,991,815
========== ========== =========== ===========
LIABILITIES AND
STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
Accounts payable......... $ 38,018 $ 39,369 $ -- $ 77,387
Construction payable..... 7,896 12,063 -- 19,959
Income taxes payable..... 3,296 -- -- 3,296
Dividend payable......... 11,388 -- -- 11,388
Current obligation,
capital leases.......... 5,145 -- -- 5,145
Current obligation, long
term debt............... 7,852 246 -- 8,098
Accrued interest on long
term debt............... 18,915 32,615 -- 51,530
Other accrued
liabilities............. 197,580 240,204 175,000 (j) 612,784
---------- ---------- ----------- -----------
Total current
liabilities........... 290,090 324,497 175,000 789,587
---------- ---------- ----------- -----------
DEFERRED REVENUES......... 4,241 -- -- 4,241
DEFERRED INCOME TAXES..... 108,713 232,570 910,257 (k) 1,251,540
LONG TERM OBLIGATION,
CAPITAL LEASES........... 12,864 -- -- 12,864
LONG TERM DEBT............ 1,310,989 2,210,033 3,201,411 (l) 6,722,433
OTHER LIABILITIES......... -- 13,304 -- 13, 304
COMMITMENTS AND
CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock............. 1,384 940 (407)(m) 1,917
Capital in excess of par
value................... 1,261,625 1,083,459 80,008 (m) 2,425,092
Treasury stock, at
cost.................... (505,824) (316,385) 316,385 (m) (505,824)
Retained earnings........ 267,165 1,255,888 (1,255,888)(m) 267,165
Other comprehensive
income.................. 9,496 -- -- 9,496
---------- ---------- ----------- -----------
Total stockholders'
equity................ 1,033,846 2,023,902 (859,902) 2,197,846
---------- ---------- ----------- -----------
$2,760,743 $4,804,306 $ 3,426,766 $10,991,815
========== ========== =========== ===========
</TABLE>
9
<PAGE>
MGM GRAND, INC.
NOTES TO UNAUDITED PRO FORMA
CONDENSED FINANCIAL STATEMENTS
Note 1--Historical financial information for MGM Grand and Mirage for the year
ended December 31, 1999 have been derived from the MGM Grand and Mirage
historical financial statements.
Note 2--The following table sets forth the determination and preliminary
allocation of the purchase price based on the $21.00 per share to be paid by
MGM Grand to Mirage shareholders.
<TABLE>
<CAPTION>
(In
Thousands)
----------
<S> <C>
Merger consideration (189.9 million shares of Mirage common
stock plus 36.5 million Mirage stock options)................ $4,394,811
Estimated fair value of Mirage debt assumed by MGM Grand 2,116,879
Estimated transaction costs and expenses...................... 13,000
Other adjustments, net........................................ 175,000
----------
$6,699,690
==========
The preliminary allocation of the pro forma purchase price is
as follows:
Land.......................................................... $3,513,400
Property and equipment, net................................... 3,210,360
Goodwill...................................................... 515,451
Other, net.................................................... (539,521)
----------
$6,699,690
==========
</TABLE>
The final purchase price and its allocation will be based on appraisals,
discounted cash flows, quoted market prices and estimates by management and is
expected to be completed within one year of the closing of the merger.
The following are brief descriptions of the pro forma adjustments to the
statements of income to reflect MGM Grand's acquisition of Mirage.
(a) Represents the cost savings of duplicative departments and redundant
infrastructure but does not reflect the benefit of other operating synergies
that are expected to be realized.
(b) Represents the amortization of goodwill and other intangible assets
to which the purchase price is allocated.
(c) Represents the additional interest expense based upon anticipated
debt offerings totaling $5.1 billion minus the interest on the MGM Grand and
Mirage credit facilities (see Note l). Also includes the amortization expense
associated with $93.4 million of Mirage debt discount amortized over 6 years,
offset by additional capitalized interest on Mirage projects in development.
(d) Represents the tax effect of the pro forma adjustments at the 35%
statutory tax rate.
(e) Represents the number of MGM Grand, Inc. shares expected to be issued
based upon an equity offering of $1.2 billion and a $22.31 price per share
(closing price on March 22, 2000).
Note 3 - The following are brief descriptions of the pro forma adjustments to
the balance sheet to reflect the acquisition by MGM Grand of Mirage.
(f) Represents the net increase to Mirage's carrying value of land,
buildings, furniture, fixtures and equipment to adjust those assets to their
estimated fair market value.
10
<PAGE>
(g) Represents the increase in the fair value of Mirage's investment in
unconsolidated affiliate based upon the fair value of the assets and
liabilities of the unconsolidated affiliate.
(h) Represents the estimated goodwill created by the transaction after
allocating the purchase price to the fair value of Mirage's assets and
liabilities.
(i) Represents the net increase in the fair value of other intangible
assets such as customer lists and trademarks.
(j) Represents an accrual for the estimated costs of the transaction.
(k) Records the deferred tax effect of the pro forma balance sheet
adjustments, primarily related to land, buildings, furniture, fixtures and
equipment.
(l) Represents the anticipated proceeds from various debt offerings of
approximately $5.1 billion of which $3.2 billion is for the purchase of the
Mirage shares, $1.8 billion is for the repayment of the MGM Grand and Mirage
bank facilities, and $100 million is for financing costs. This amount is
offset by the debt discount of $93.4 million on the Mirage bonds.
(m) Represents the issuance of 53.8 million shares of MGM common stock
for $22.31 per share (closing price on March 22, 2000) as well as the
elimination of Mirage's equity balances.
11
<PAGE>
DESCRIPTION OF OUR LONG TERM DEBT
Our Bank Credit Facility
Since 1996, we have had available to us a credit facility from a syndicate
of banks led by Bank of America, N.A. On July 23, 1997, we amended our
syndicated bank credit facility to make it a $1.25 billion senior revolving
credit facility which may be increased to $1.5 billion under its existing
terms. The credit facility has subsequently been amended several times in less
significant ways. The following description is a summary of the material
provisions of the credit facility, but it does not restate the credit facility
agreement in its entirety. We urge you to read the credit facility agreement,
which we have filed with the Securities and Exchange Commission (see "Where
You Can Find More Information" on page 26 below).
The credit facility is available:
(1) to finance capital improvements at MGM Grand Las Vegas in accordance
with our master plan with respect to that property, up to $850 million;
(2) to fund development costs for MGM Grand Atlantic City or other casino,
resort and hotel projects, or to invest in casino, resort and hotel
companies or projects, up to $1.0 billion;
(3) to fund our proposed project in Detroit, Michigan, up to $750 million;
and
(4) for general corporate purposes, including repurchases of our own common
stock, investments in qualified investments and other capital
expenditures, up to $750 million.
Commencing on December 31, 2001, availability under the credit facility
will decline in quarterly increments of the greater of $62.5 million or 5% of
the commitment amount under the credit facility, with the balance due on
December 31, 2002. We have the right to request one-year extensions, subject
to the consent of the lenders, which would have the effect of deferring
scheduled reductions in availability.
Interest on outstanding balances and commitment fees on unutilized
availabilities under the credit facility are determined by a formula based
either on our leverage ratio (which is the ratio of our total debt to
annualized cash flow) or the credit facility rating (which is the credit
rating then applicable to the credit facility), and in the case of interest
rates, on the basis of the Eurodollar or base rate existing at the time of
determination. As our leverage ratio declines, the interest rate and
commitment fees will also decline. We also pay certain underwriting and agency
fees in connection with the credit facility.
The credit facility is unconditionally guaranteed by each of our
subsidiaries except New York-New York, The Primadonna Company, LLC, PRMA, LLC,
New PRMA Las Vegas, Inc., MGM Grand Detroit II, LLC, MGM Grand-Bally's
Monorail Limited Liability Company, MGM Grand Australia, Inc. and our non-U.S.
subsidiaries and their U.S. holding companies which have no other assets or
operations. Our subsidiaries which do not guarantee the credit facility are
called the "facility nonguarantors" below. The credit facility is secured by
pledges of substantially all of our assets, including the stock of MGM Grand
Hotel, Inc. and MGM Grand Atlantic City, Inc., but not our interest in any
facility nonguarantor, and the assets of our subsidiaries other than the
facility nonguarantors. The guaranty given by MGM Grand Detroit, LLC, and the
pledge of its assets, are limited to the amount borrowed under the credit
facility which is made available to MGM Grand Detroit, LLC. The credit
facility can become unsecured, at our option, if it receives investment grade
ratings as unsecured debt from both Moody's and Standard & Poor's.
The credit facility contains certain customary events of default and
agreements, including limitations on additional debt, dividends, mergers and
asset sales and capital expenditures. It also restricts acquisitions and
similar transactions. As of March 23, 2000, approximately $680 million was
outstanding under the credit facility. Also, during May 1999, two letters of
credit were issued under the credit facility totaling approximately $50
million, which support municipal financing used to acquire land for a
permanent casino in Detroit.
We anticipate that the credit facility will be amended and restated in its
entirety in connection with our acquisition of Mirage. A description of the
anticipated amended credit facility appears below on page 14.
12
<PAGE>
Our Senior Secured Notes
In addition to the credit facility, we also have outstanding two series of
senior secured notes with a total principal amount of $500 million. One of
these series of senior secured notes has a total principal amount of $300
million, pays interest semiannually at a rate of 6.95% and matures on February
1, 2005. The other series of senior secured notes has a total principal amount
of $200 million, pays interest semiannually at a rate of 6 7/8% and matures on
February 6, 2008. The material terms of the two series of senior secured notes
are otherwise identical. The following description of our senior secured notes
is a summary of the material provisions of the indentures under which the
senior secured notes were issued, which have been filed with the Securities
and Exchange Commission (see "Where You Can Find More Information" on page 26
below).
The senior secured notes are our direct obligations, guaranteed by each of
our subsidiaries other than the facility nonguarantors. The senior secured
notes and these guarantees are secured by pledges of the same assets that are
pledged to secure the credit facility. The guaranty of MGM Grand Detroit, LLC
and the pledge of its assets are limited in the same way its guaranty and
pledge are limited under the credit facility. Under agreements binding the
banks that are party to the credit facility and the holders of the senior
secured notes, the collateral securing the credit facility and the senior
secured notes, and any proceeds of such collateral, must be divided equally
and ratably among the credit facility and the senior secured notes. The senior
secured notes and the guarantees can become unsecured, at our option, if the
credit facility becomes unsecured and the unsecured facility and the senior
secured notes each receive investment grade ratings from both Moody's and
Standard & Poor's unless the release of collateral will cause either credit
rating to fall below the rating given to the senior secured notes at the time
they were issued.
The indentures contain certain events of default and agreements which are
customary with respect to investment grade debt securities, including
limitations on mergers, consolidations, and sale of substantially all assets
by us, and limitations on liens and sale and leaseback transactions by us or
our subsidiaries (other than the facility nonguarantors). The indentures also
contain limitations on certain asset sales which apply to us and our
subsidiaries other than some of the facility nonguarantors. The indentures do
not limit the amount of indebtedness we may incur.
The senior secured notes are redeemable at our option at any time at a
redemption price specified in the indenture. In addition, the asset sale
limitations in the indentures require us to either apply the proceeds of such
sales in certain ways specified in the indentures or use the proceeds to
redeem senior secured notes. The applicable gaming laws of the jurisdictions
in which we operate also include provisions which require, under certain
circumstances specified under those laws, that senior secured notes be
divested by holders who are found to be inappropriate under those laws. Except
as described in this paragraph, the senior secured notes do not include
redemption or sinking fund features.
We expect the senior secured notes will become unsecured and the collateral
securing them released when we receive investment grade ratings from both
Moody's and Standard & Poor's, which we expect to occur concurrently with our
acquisition of Mirage. However, the indentures provide that if, following the
release of the collateral securing the senior secured notes, the notes fail to
maintain investment grade ratings from either Moody's or Standard & Poor's we
must again secure the notes with pledges of substantially all of our assets
and those of the guarantors.
MGM Grand Detroit II, LLC Interim Credit Facility
On March 31, 1999, MGM Grand Detroit II, LLC ("Detroit II"), obtained an
interim $230 million senior revolving credit facility from a syndicate of
banks led by Bank of America, N.A., which may be increased to $250 million
under its existing terms. The Detroit interim credit facility is secured by
pledges of substantially all assets of Detroit II. In addition, we have
provided an unconditional guaranty of the Detroit interim credit facility, but
our guaranty is not secured. The following is a summary of material provisions
of the Detroit interim credit facility, which has been filed with the
Securities and Exchange Commission (see "Where You Can Find More Information"
on page 26 below), and is not restated in its entirety herein.
13
<PAGE>
The Detroit interim credit facility is available:
. to refinance funds previously invested by us in the interim casino
project in Detroit, Michigan;
. to finance the design, development and construction of the interim
casino;
. to finance up to $50 million of initial development expenses associated
with the proposed permanent hotel/casino project we are planning to
construct in Detroit, Michigan (if we choose to have the permanent
casino constructed by Detroit II); and
. to finance other capital expenditures, acquisitions and investments to
the extent permitted by the Detroit interim credit facility.
Interest on outstanding balances and commitment fees on unutilized
availabilities under the Detroit interim credit facility are determined by a
formula based on ratings given to our $1.25 billion credit facility (or, if
that credit facility has terminated, our senior unsecured debt) by Moody's and
Standard & Poor's, and in the case of interest rates, on the basis of the
Eurodollar or base rate existing at the time of determination.
Availability under the Detroit interim credit facility will decline in
quarterly increments of the greater of $19.2 million or 8 1/3% of the
commitment amount of the Detroit interim credit facility, commencing on
March 31, 2001. The Detroit interim credit facility matures on the earliest of
June 30, 2004, 45 months following the opening of the interim casino and the
date the permanent casino is opened for gaming customers.
The Detroit interim credit facility contains certain customary events of
default and agreements, including limitations with respect to additional debt,
dividends, mergers and asset sales and capital expenditures. It also restricts
acquisitions and similar transactions. As of March 23, 2000, approximately
$146 million was outstanding under the Detroit interim credit facility. We do
not expect the Detroit interim credit facility to be affected by our
acquisition of Mirage.
Our Amended Credit Facilities
We have received commitments from Bank of America, N.A. for $5.0 billion in
debt financing, consisting of $4.0 billion in senior revolving bank financing
and $1.0 billion in bridge financing. If we use the foregoing commitments, we
might complete a subordinated bond offering prior to or concurrently with
completion of the Mirage merger, with the proceeds from this bond offering
reducing the amount borrowed under the bridge financing by a corresponding
amount. In addition, we might obtain an additional $600 million in financing
from our existing bank line facilities, which are also provided by Bank of
America. The bank commitments are subject to certain conditions.
The senior revolving credit facilities obtained in the commitments consist
of (1) a $2.0 billion five-year senior revolving credit facility maturing five
years from the closing of the merger, and (2) a $1.0 billion senior revolving
credit facility maturing 364 days from the closing of the merger. The
commitments also include a $1.0 billion 12-month senior term loan maturing 12
months from the closing of the merger.
The $1.0 billion bridge facility is available to us as an alternative to
bond financing. Bank of America has the option to structure the bridge
facility either as a senior debt financing with a 364-day maturity or as a
subordinated bridge facility. In the event that the bridge facility is
structured as a subordinated bridge facility, Bank of America and Banc of
America Securities LLC, the lead arranger and book manager for the Bank of
America credit facilities, are entitled, in consultation with MGM Grand, to
determine the appropriate pricing, structure and other terms of the bridge
facility so as to reflect, in the sole determination of Bank of America and
Banc of America Securities, the appropriate pricing, structure and other terms
of subordinated debt financings of that type under then-current financial and
capital market conditions.
The merger agreement also permits us to obtain amended or replacement
financing under certain circumstances. We are considering an alternative to
the above financing in connection with our acquisition of
14
<PAGE>
Mirage. As part of this alternative, we will have available to us amendments
to our credit facility to provide for three separate credit facilities, each
from a syndicate of banks led by Bank of America, N.A. The three bank credit
facilities will allow us to borrow up to $2 billion, $1 billion and $1.3
billion, respectively. The $2 billion credit facility and the $1 billion
credit facility are both senior revolving credit facilities. This means that
we will be allowed to reborrow amounts we have borrowed and subsequently
repaid under each of these facilities. The $2 billion credit facility will
mature five years after the first day it is available to us, and the $1
billion credit facility will mature 364 days after the first day it is
available to us. The $1.3 billion credit facility will be a senior term loan,
which means that amounts borrowed and repaid by us under this credit facility
cannot be reborrowed. We will be required to repay the $1.3 billion credit
facility one year from the first day it is available to us.
The following description is a summary of the material provisions of the
amended credit facilities now being considered, but it does not restate the
three components of the amended credit facility agreements in their
entireties. We urge you to read the credit facility agreements, which we will
file with the Securities and Exchange Commission when they are finalized.
Each credit facility will be available:
. to refinance our existing debt, including our $1.25 billion syndicated
bank credit facility and the existing $1.75 billion credit facility
now available to Mirage;
. to finance the purchase price of our acquisition of Mirage;
. to finance capital improvements at our properties and at the Mirage
properties following our acquisition of Mirage; and
. for working capital, acquisitions, investments in qualified
investments and repurchases of our own common stock.
In addition, we will have the right under the $2 billion credit facility to
obtain letters of credit not exceeding a specified aggregate amount, including
to support any commercial paper we may issue from time to time.
Interest on outstanding balances and commitment fees on unutilized
availability under each of the facilities will be determined by formulas based
on our senior unsecured debt ratings without credit enhancement (which is the
credit rating applicable to the facilities, as established by the credit
rating agencies Moody's and Standard & Poor's), and (in the case of interest
rates) on the basis of the Eurodollar or base rate existing at the time of
determination. We will also pay certain underwriting and agency fees in
connection with the facilities.
The facilities will be unconditionally guaranteed by each of our
subsidiaries except the facility nonguarantors. The facilities will also be
unconditionally guaranteed by Mirage and each of its subsidiaries following
our acquisition of Mirage. The facilities and the guarantees will be
unsecured. However, the credit facility agreements will restrict our ability
to encumber our assets (including the guarantors' assets) until the facilities
have been repaid and our right to borrow under them has ended.
The facilities will contain customary events of default and agreements,
including limitations on additional debt, dividends, mergers and asset sales
and capital expenditures. They will also restrict acquisitions and similar
transactions. In addition, the $1.3 billion term-loan credit facility will
require us to use all of the proceeds of any debt we incur after that credit
facility becomes available (other than debt subordinated to the facilities) to
pay down that credit facility (until it is paid in full).
The amended credit facilities as currently contemplated and our senior
notes will be unsecured as long as each has an investment grade rating from
both Moody's and Standard & Poor's.
15
<PAGE>
Existing Unsecured Senior Notes of Mirage Resorts, Incorporated
Mirage has outstanding five series of senior unsecured notes. The Mirage
notes will remain outstanding as obligations of Mirage after we acquire
Mirage. The maturity dates, annual interest rates and amounts outstanding
under each series of Mirage notes as of December 31, 1999 are as follows:
<TABLE>
<CAPTION>
Series Amount Outstanding
------ -------------------------
(in thousands of dollars)
<S> <C>
6-5/8% notes, due February 2005, net of
unamortized original issue discount of $817... $199,183
7-1/4% notes, due October 2006, net of
unamortized original issue discount of $247... $249,753
6-3/4% notes, due August 2007, net of
unamortized original issue discount of $739... $199,261
6-3/4% notes, due February 2008, net of
unamortized original issue discount of $909... $199,091
7-1/4% debentures, due August 2017, net of
unamortized original issue discount of $287... $ 99,713
</TABLE>
The following description of the Mirage Notes is a summary of the material
provisions of the indentures under which the Mirage notes were issued, which
have been filed with the Securities and Exchange Commission (see "Where You
Can Find More Information" at page 26 below).
The Mirage notes are the direct obligations of Mirage. The Mirage notes are
unsecured. However, the indentures under which the Mirage notes were issued
provide (with some exceptions) that if Mirage secures any of its debt to other
persons, then the Mirage notes must also be secured by the same collateral
equally and ratably with the secured debt.
The Mirage notes are redeemable, in whole or in part, at the option of
Mirage at any time at a redemption price equal to the greater of:
. 100% of the principal amount, or
. The sum of the present values of the remaining scheduled interest and
principal payments discounted to the date of redemption on a semiannual
basis at the Adjusted Treasury Rate (as defined),
plus, in either case, accrued interest to the redemption date. Except as
described under this heading, the Mirage notes do not include redemption or
sinking fund features.
The Mirage indentures contain certain events of default and agreements
which are customary with respect to investment grade debt securities,
including limitations on mergers, consolidations, asset sales and sale and
leaseback transactions by Mirage or its subsidiaries. The indentures also
contain limitations on liens which apply to Mirage and its subsidiaries. The
indentures do not limit the amount of indebtedness Mirage may incur.
The applicable gaming laws of the jurisdictions in which Mirage operates
also include provisions which require, under certain circumstances specified
under those laws, that the Mirage notes be divested by holders who are found
to be unsuitable under those laws.
16
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following provides a general description of the terms of the debt
securities which we may issue. The particular terms of any debt securities
offered by any prospectus supplement and the extent, if any, to which the
general provisions set forth below may not apply will be described in the
prospectus supplement relating to those debt securities.
We filed a form of indenture as an exhibit to the registration statement of
which this prospectus is a part. The debt securities will be issued under one
or more indentures, each dated as of a date on or before the issuance of the
debt securities to which it relates and in the form filed, subject to any
amendments or supplements as we may adopt from time to time. Each indenture
will be entered into between us, as obligor, a trustee chosen by us and
qualified to act as a trustee under the Trust Indenture Act of 1939, and any
of our subsidiaries which guarantee our obligations under the indenture. You
should read the indenture because it, and not this description, will control
your rights as a holder of debt securities. The terms of the indenture are
also governed by the Trust Indenture Act.
General
The debt securities will be our direct obligations, which will be
unsecured, rank subordinate to our credit facilities, of which $680 million
was outstanding on March 23, 2000 and may rank subordinate to, equally with or
senior to our other indebtedness, including our senior notes, of which $500
million was outstanding on March 23, 2000. Our credit facilities will provide
that unsecured subordinated debt securities may be issued under an indenture
without limit as to aggregate principal amount, in one or more series, in each
case as established from time to time in or pursuant to authority granted by a
resolution from our board of directors or as established in one or more
indentures supplemental to the indenture. All debt securities of one series do
not need to be issued at the same time. Additionally, unless otherwise
provided, a series may be reopened, without the consent of the holders of the
debt securities of such series, for issuances of additional debt securities of
such series.
Terms of the Debt Securities
You should refer to the prospectus supplement for the following terms of
each series of the debt securities in respect of which this prospectus is
being delivered:
. the designation, aggregate principal amount and authorized denominations
of the series;
. the issue price as a percentage of the principal amount at which the
series will be issued and, if other than the principal amount thereof,
the portion of the principal amount thereof payable upon declaration of
acceleration of the maturity or upon redemption thereof and the rate or
rates at which original issue discount will accrue;
. the date or dates on which the series will mature;
. the rate or rates per annum, if any, at which the series will bear
interest;
. the times from which any interest will accrue, be payable and the record
dates pertaining thereto;
. the place or places where the principal and interest, if any, on the
series will be payable;
. any redemption or other special terms;
. the events of default and covenants relating to the debt securities
which are in addition to, modify or delete those described herein;
. whether the debt securities will be issued in certificated or book-entry
form, and the denominations thereof;
. if applicable, the terms of any right to convert debt securities into
shares of our common stock or other securities or property;
. provisions, if any, for the defeasance or discharge of certain of our
obligations with respect to such debt securities, which provisions may
be in addition to, in substitution for, or in modification of (or any
combination of the foregoing), the provisions of the indenture;
17
<PAGE>
. the manner in which the amounts of payment of principal of, premium, if
any, or any interest on such debt securities will be determined, if such
amounts may be determined by reference to an index based on a currency
or currencies other than that in which such debt securities are
denominated or designated to be payable or by reference to a commodity,
commodity index, stock exchange index or financial index;
. a discussion of any material and/or special United States federal income
tax considerations applicable to such debt securities;
. any depositaries, trustees, interest rate calculation agents, exchange
rate calculation agents or other agents with respect to the debt
securities other than those originally appointed;
. whether such debt securities will be issued in the form of one or more
global securities and whether such global securities are to be issuable
in a temporary global form or permanent global form;
. the terms, if any, on which such debt securities will be subordinate to
other debt;
. any listing or intended listing of the debt securities on a securities
exchange;
. the provisions, if any, relating to any guarantees of the debt
securities; and
. any other terms of the debt securities, which will not be inconsistent
with the provisions of the indenture.
Our debt securities may be sold at a discount below their principal amount.
Even if our debt securities are not issued at a discount below their principal
amount, these securities may, for United States federal income tax purposes,
be deemed to have been issued with original issue discount because of certain
interest payment or other characteristics. Special United States federal
income tax considerations applicable to debt securities issued with original
issue discount will be described in more detail in any applicable prospectus
supplement. In addition, special United States federal tax considerations or
other restrictions or terms applicable to any debt securities offered
exclusively to foreigners or denominated in a currency other than United
States dollars will also be set forth in the prospectus supplement, if
applicable.
Information About the Trustee
Our indenture provides that there may be more than one trustee, each with
respect to one or more series of debt securities. Any trustee under our
indenture may resign at any time or be removed with respect to one or more
series of debt securities, and a successor trustee may be appointed to act
with respect to such series. If two or more persons are acting as trustees
with respect to different series of debt securities, each trust shall be
separate and apart from the trust administered by any other trustee. Except as
indicated in this prospectus or any prospectus supplement, any action to be
taken by the trustee may be taken only with respect to the one or more series
of debt securities for which it is trustee under the indenture.
Merger, Consolidation or Sale of Assets
Our indenture does not allow us to consolidate or merge with or into, or
sell, assign, convey, transfer or lease our properties and assets,
substantially in their entirety, as computed on a consolidated basis, to
another corporation, person or entity unless:
. either we are the surviving person, in the case of a merger or
consolidation, or the successor or transferee is a corporation organized
under the laws of the United States, or any state thereof or the
District of Columbia and the successor or transferee corporation
expressly assumes, by supplemental indenture, all of our obligations
under the debt securities and the indenture; and
. no default or event of default exists immediately after such
transaction.
Denominations
Unless we specify in the prospectus supplement, the debt securities of any
series will be issuable only as debt securities in denominations of $1,000,
and any integral multiples thereof, and will be payable only in U.S. dollars.
The indenture also provides that debt securities of a series may be issuable
in global form. See "Global Securities" below.
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Registration and Transfer
If you surrender for transfer your registered debt securities at the office
or agency we maintain for such purpose, we will deliver, in the name you have
designated as transferee, one or more new debt securities of the same series
of like aggregate principal amount in such denominations as are authorized for
debt securities of such series and of a like maturity and with like terms and
conditions. You will not incur a service charge for any transfer or exchange
of debt securities, but we may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection with the transfer
or exchange.
We will not be required to:
. register, transfer or exchange debt securities of any series during a
period beginning with the opening of business 15 days before the day of
the transmission of a notice of redemption of debt securities of such
series selected for redemption, and ending at the close of business on
the day of the transmission; or
. register, transfer or exchange any debt security so selected for
redemption in whole or in part, except the unredeemed portion of any
debt security being redeemed in part.
Events of Default
Unless we inform you otherwise in the prospectus supplement, events of
default means any of the following:
. default in the payment of any interest upon any debt security of that
series when it becomes due and payable, and continuance of such default
for a period of 30 days;
. default in the payment of principal of or premium, if any, on any debt
security of that series when due;
. if applicable, default in the deposit of any sinking fund payment, when
and as due in respect of any debt security of that series;
. default in the performance, or breach, of any covenants or warranties in
the indenture if the default continues uncured for a period of 60 days
after written notice to us by the applicable trustee or to us and the
applicable trustee by the holders of at least 25% in principal amount of
the outstanding debt securities of that series as provided in the
indenture; and
. certain events of bankruptcy, insolvency or reorganization.
If an event of default for any series of debt securities, which are at that
time outstanding, occurs and continues, then the applicable trustee or the
holders of not less than 25% in principal amount of the outstanding debt
securities of that series may, by a notice in writing to us, and to the
applicable trustee if given by the holders, declare to be due and payable
immediately the principal, or, if the debt securities of that series are
discount securities, such portion of the principal amount as may be specified
in the terms of that series and premium, if any, of all debt securities of
that series.
At any time after a declaration of acceleration with respect to debt
securities of any series has been made, but before a judgment or decree for
payment of the money due has been obtained by the applicable trustee, the
holders of a majority in principal amount of the outstanding debt securities
of that series may, subject to our having paid or deposited with the trustee a
sum sufficient to pay overdue interest and principal which has become due
other than by acceleration and certain other conditions, rescind and annul
such acceleration if all events of default, other than the non-payment of
accelerated principal and premium, if any, with respect to debt securities of
that series, have been cured or waived as provided in the indenture. For
information as to waiver of defaults see the discussion set forth below under
"Modification and Waiver."
You should refer to our prospectus supplement with regard to any series of
debt securities that are discount securities for the particular provisions
relating to acceleration of a portion of the principal amount of such discount
securities upon the occurrence and continuation of an event of default.
The indenture provides that the trustee is not obligated to exercise any of
its rights or powers under the indenture at the request of any holder of
outstanding debt securities, unless the trustee receives indemnity
satisfactory to it against any loss, liability or expense. Subject to certain
rights of the trustee, the holders of a
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majority in principal amount of the outstanding debt securities of any series
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee or exercising any trust or
power conferred on the trustee with respect to the debt securities of that
series.
No holder of any debt security of any series will have any right to
institute any proceeding, judicial or otherwise with respect to the indenture
or for the appointment of a receiver or trustee, or for any remedy under the
indenture, unless such holder shall have previously given to the applicable
trustee written notice of a continuing event of default with respect to debt
securities of that series and the holders of at least 25% in principal amount
of the outstanding debt securities of that series shall have made written
request, and offered reasonable indemnity, to such trustee to institute such
proceeding as trustee, and the trustee shall not have received from the
holders of a majority in principal amount of the outstanding debt securities
of that series direction inconsistent with such request and shall have failed
to institute such proceeding within 60 days. However, the holder of any debt
security will have an absolute and unconditional right to receive payment of
the principal of, premium, if any, and any interest on such debt security on
or after the due dates expressed in such debt security and to institute suit
for the enforcement of any such payment.
We are required by the indenture, within 120 days after the end of each
fiscal year, to furnish to the trustee a statement as to compliance with the
indenture. The indenture provides that the trustee with respect to any series
of debt securities may withhold notice to the holders of debt securities of
such series of any default or event of default (except a default in payment on
any debt securities of such series) with respect to debt securities of such
series if and so long as a committee of its trust officers, in good faith,
determines that withholding such notice is in the interest of the holders of
debt securities of such series.
Modification and Waiver
We and the applicable trustee, at any time and from time to time, may
modify the indenture without prior notice to or consent of any holder of any
series of debt securities for any of the following purposes:
. to permit a successor corporation to assume our covenants and
obligations under the indenture and in such series of debt securities in
accordance with the terms of the indenture;
. to add to our covenants for the benefit of the holders of any series of
debt securities (and if the covenants are to be for the benefit of less
than all the series, we shall state that the covenants are expressly
being included solely for the benefit of the applicable series);
. to surrender any of our rights or powers conferred in the indenture;
. to add any additional events of default (and if the events of default
are to be applicable to less than all series, we shall state that the
events of default are expressly being included solely for the benefit of
the applicable series);
. to add to, change or eliminate any of the provisions of the indenture in
a manner that will become effective only when there is no outstanding
debt security which is entitled to the benefit of the provision and as
to which the modification would apply;
. to secure a series of debt securities or to provide that our obligations
under a series of debt securities or the indenture will be guaranteed
and the terms and conditions for the release or substitution of the
security or guarantee;
. to supplement any of the provisions of the indenture to the extent
needed to permit or facilitate the defeasance and discharge of a series
of debt securities in a manner that will not adversely affect the
interests of the holders of debt securities of that series or any other
series of debt securities issued under the indenture in any material
respect;
. to establish the form or terms of debt securities as permitted by the
indenture;
. to provide for the acceptance of appointment by a successor trustee
regarding one or more series of debt securities and to add to or change
any of the provisions of the indenture as is necessary to provide for
the administration of the trusts by more than one trustee;
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. to comply with the requirements of the Securities and Exchange
Commission in connection with qualification of the indenture under the
Trust Indenture Act;
. to cure any ambiguity;
. to correct or supplement any provision in the indenture which may be
defective or inconsistent with any other provision in the indenture;
. to eliminate any conflict between the terms of the indenture and the
debt securities and the Trust Indenture Act; or
. to make any other provisions with respect to matters or questions
arising under the indenture which will not be inconsistent with any
provision of the indenture as long as the new provisions do not
adversely affect in any material respect the interests of the holders of
any outstanding debt securities of any series created prior to the
modification.
We may also modify the indenture for any other purpose if we receive the
written consent of the holders of not less than a majority in principal amount
of the outstanding debt securities of each series affected by such
modification voting separately. However, we may not, without the consent of
the holder of each outstanding debt security of each series affected:
. change the stated maturity or reduce the principal amount or the rate of
interest, or extend the time for payment of interest of any debt
security or any premium payable upon the redemption of any debt
security, or change the stated maturity of, or reduce the amount of the
principal of a discount security that would be due and payable upon a
declaration of acceleration of the maturity of a discount security or
impair the right to institute suit for the enforcement of any payment on
or after the due date thereof (including, in the case of redemption, on
or after the redemption date), or alter any redemption provisions in a
manner adverse to the holders of such series of debt securities;
. reduce the percentage in principal amount of the outstanding debt
securities of a series where the consent of the holder is required for
any such amendment, supplemental indenture or waiver which is provided
for in the indenture;
. if applicable, adversely affect the right of a holder to convert any
debt security;
. modify any of the waiver provisions, except to increase any required
percentage or to provide that certain other provisions of the indenture
cannot be modified or waived without the consent of the holder of each
outstanding debt security which would be affected; or
. modify any provision described in the prospectus supplement as requiring
the consent of each affected holder of debt securities.
A modification which changes or eliminates any covenant or other provision
of the indenture with respect to one or more particular series of debt
securities, or which modifies the rights of the holders of debt securities of
a series with respect to such covenant or other provision, shall be deemed not
to affect the rights under the indenture of the holders of debt securities of
any other series.
The indenture provides that the holders of not less than a majority in
aggregate principal amount of the then outstanding debt securities of any
series, by notice to the relevant trustee, may on behalf of the holders of the
debt securities of such series waive any default and its consequences under
the indenture, except (1) a continuing default in the payment of interest on,
premium, if any, or the principal of, any such debt security held by a
nonconsenting holder or (2) a default in respect of a covenant or provision
hereof which cannot be modified or amended without the consent of the holder
of each outstanding debt security of each series affected.
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Defeasance of Debt Securities or Certain Covenants in Certain Circumstances
Defeasance and Discharge. The indenture provides that we may be discharged
from any and all obligations under any debt securities other than:
. certain obligations to pay additional amounts, if any, upon the
occurrence of certain tax, assessment or governmental charge events
regarding payments on debt securities;
. to register the transfer or exchange of debt securities;
. to replace stolen, lost or mutilated debt securities; or
. to maintain paying agencies and to hold money for payment in trust.
We may only defease and discharge all of our obligations under the debt
securities of any series if:
. we irrevocably deposit with the trustee, in trust, the amount, as
certified by an officers' certificate, of money and/or U.S. government
obligations that, through the payment of interest and principal in
respect thereof in accordance with their terms, will be sufficient to
pay and discharge each installment of principal and premium, if any and
any interest on, and any mandatory sinking fund payments in respect of,
the debt securities of such series on the dates such payments are due;
and
. we deliver to the trustee an opinion of counsel or a ruling from the
United States Internal Revenue Service, in either case to the effect
that holders of the debt securities of such series will not recognize
income, gain or loss for United States federal income tax purposes as a
result of such deposit, defeasance and discharge.
Defeasance of Certain Covenants. Upon compliance with certain conditions,
we may omit to comply with certain restrictive covenants contained in the
indenture or in the applicable prospectus supplement or any other restrictive
covenant relating to any series of debt securities provided for in a board
resolution or supplemental indenture which by its terms may be defeased
pursuant to the terms of such series of debt securities. Any omission to
comply with our obligations or covenants shall not constitute a default or
event of default with respect to any debt securities. In that event, you would
lose the protection of these covenants, but would gain the protection of
having money and/or U.S. government obligations set aside in trust to repay
the series of debt securities. We may only defease any covenants if, among
other requirements:
. we deposit with the trustee money and/or U.S. government obligations
that, through the payment of interest and principal in respect to such
obligations, in accordance with their terms, will provide money in an
amount, as certified by an officers' certificate, sufficient to pay
principal, premium, if any, and any interest on and any mandatory
sinking fund payments in respect of the debt securities of such series
on the dates such payments are due; and
. we deliver to the trustee an opinion of counsel or a ruling from the
United States Internal Revenue Service to the effect that the holders of
the debt securities of such series will not recognize income, gain or
loss, for United States federal income tax purposes, as a result of the
covenant defeasance.
Limited Liability of Certain Persons
The indenture provides that none of our past, present or future
stockholders, incorporators, employees, officers or directors, or of any
successor corporation or any of our affiliates shall have any personal
liability in respect of our obligations under the indenture or the debt
securities by reason of his, her or its status as such stockholder,
incorporator, employee, officer or director.
Mandatory Disposition Pursuant to Gaming Laws
The indenture provides that each holder and beneficial owner, by accepting
any of the debt securities subject thereto, shall be deemed to have agreed
that if the gaming authority of any jurisdiction of which we or any of our
subsidiaries conducts or proposes to conduct gaming, requires that a person
who is a holder or the beneficial owner of the debt securities be licensed,
qualified or found suitable under applicable gaming laws, such holder or
beneficial owner, as the case may be, shall apply for a license, qualification
or a finding of suitability within
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the required time period. If such person fails to apply or become licensed or
qualified or is found unsuitable, we shall have the right, at our option:
. to require such person to dispose of its debt securities or beneficial
interest therein within 30 days of receipt of notice of our election or
such earlier date as may be requested or prescribed by such gaming
authority; or
. to redeem such debt securities at a redemption price equal to 100% of
the principal amount thereof, plus accrued and unpaid interest, if any,
to the earlier of the redemption date or the date of the finding of
unsuitability, which may be less than 30 days following the notice of
redemption if so requested or prescribed by the applicable gaming
authority or such lesser amount as may be required by applicable law or
by order of any gaming authority.
We shall notify the trustee in writing of any such redemption as soon as
practicable. We shall not be responsible for any costs or expenses any such
holder may incur in connection with its application for a license,
qualification or a finding of suitability.
Conversion Rights
The terms and conditions, if any, upon which the debt securities are
convertible into common stock or other securities or property will be set
forth in the applicable prospectus supplement. Such terms will include the
conversion price (or manner of calculation thereof), the conversion period,
provisions as to whether conversion will be at our option or at the option of
the holders, the events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of such debt
securities.
Guarantee
The indenture provides that one or more of our subsidiaries may be a
guarantor and may "guarantee" the performance and punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all of our
obligations under the debt securities of any series and the indenture. The
liability of the guarantors will be independent of and not in consideration of
or contingent upon our liability or any other party obligated under the debt
securities or the indenture. A separate action or actions may be brought or
prosecuted against us or any other party obligated under the debt securities
or the indenture whether or not we or any other party obligated under the debt
securities or the indenture are joined in any such action or actions. However,
any guarantee will be limited to an amount not to exceed the maximum amount
that can be guaranteed by the guarantor without rendering the guarantee, as it
relates to such guarantor, original issue discountable under Section 548 of
the Federal Bankruptcy Code or any applicable provision of comparable state
law. This guarantee will be a continuing guarantee and will remain in full
force and effect until payment in full of all of the guaranteed obligations.
Payment and Paying Agents
We covenant and agree, for the benefit of each series of debt securities,
that we will duly and punctually pay the principal of, premium, if any, and
any interest on the debt securities in accordance with the terms of the debt
securities and the indenture. We will maintain an office or agency where debt
securities of that series may be presented or surrendered for payment, where
debt securities of that series may be surrendered for registration of transfer
or exchange and where notices and demands to or upon us in respect of the debt
securities of that series and the indenture may be served.
Global Securities
The debt securities of any series may be issued in whole or in part in the
form of one or more global securities that will be deposited with, or on
behalf of, a depositary identified in the applicable prospectus supplement
relating to such series. Global securities will be in registered form and may
be issued in either temporary or permanent form. The specific terms of the
depositary arrangement regarding a series of debt securities will be described
in the applicable prospectus supplement relating to such series.
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DESCRIPTION OF COMMON STOCK
Our authorized capital stock consists of 300 million shares of common
stock. As of March 9, 2000, there were 111,832,062 shares of common stock
outstanding. Holders of the common stock are entitled to dividends when and as
declared by our board of directors. Holders have one vote per share and the
right to the net assets in liquidation after payment of any amounts due to
creditors. Holders are not liable for further calls or assessments by us.
There are no sinking fund or redemption provisions relating to the common
stock. The common stock has noncumulative voting rights, which means that the
holders of a majority of the shares voting for the election of directors can
elect 100% of the directors if they choose to do so.
Our certificate of incorporation provides that if and when we shall become,
and so long as we shall remain, a publicly traded holding company as defined
in the New Jersey Casino Control Act, all of our securities shall be held
subject to the condition that if a holder thereof is disqualified by the New
Jersey Casino Control Commission, such disqualified holder shall dispose of
his interest in the securities, including common stock within 120 days, or
such other time period required by the New Jersey Commission, following our
receipt of notice of such disqualified holder. Promptly after the notice date,
we are required to deliver a copy of such written notice to the disqualified
holder by personal delivery, mail or any other reasonable means.
Our certificate of incorporation also provides that so long as we hold,
directly or indirectly, a license or franchise from a governmental agency to
conduct our business, which license or franchise is conditioned upon some or
all of the holders of the common stock possessing prescribed qualifications,
any and all shares of the common stock shall be subject to redemption by us,
at our sole option and in our sole discretion, to the extent necessary to
prevent the loss of such license or franchise or to reinstate it. Any shares
of the common stock redeemable pursuant to such provision may be called for
redemption immediately for cash, property or rights, including our securities
or securities of another corporation, on not less than five days notice to the
disqualified holder at a redemption price equal to the average closing price
of such stock on a national securities exchange for the 45 trading days
immediately preceding the date of the redemption notice; or if the stock is
not so traded, then the average of the high and low closing bid price of the
stock as quoted by the National Association of Securities Dealers Automated
Quotation system for such 45 trading day period; or if such stock is not so
quoted, the redemption price shall be determined in good faith by the board of
directors.
The transfer agent and registrar for our common stock is ChaseMellon
Shareholder Services, LLC, 400 S. Hope Street, Los Angeles, California 90071.
Subscription Rights
The following description sets forth the general terms and provisions of
any subscription rights which may be issued and to which any prospectus
supplement may relate. The particular terms of the subscription rights and
extent, if any, to which such general provisions may not apply will be
described in the prospectus supplement relating to such subscription rights.
The subscription rights will be issued in connection with one or more
rights offerings. The subscription rights will be issued without charge to our
stockholders and will be transferable. The number of rights to be issued for
each outstanding share of our common stock as well as the subscription price
will be determined at the time of the rights offering, if any, and described
in the related prospectus supplement. We anticipate that the subscription
rights will be traded on the New York Stock Exchange, the exchange where our
common stock is traded.
We anticipate there will be two types of subscription privileges associated
with the subscription rights. Under the basic subscription privilege, a rights
holder would be entitled to purchase one share of common stock for each right
held. Under the oversubscription privilege, any rights holder who exercises
the basic subscription privilege for all rights held would be entitled to
subscribe for additional shares of common stock at the time the basic
subscription privilege is exercised. Shares will be available for the
oversubscription privilege to the extent that other rights holders do not
exercise their basic subscription privilege in full and will be subject to
proration if necessary. In each case, the rights holder must specify the
number of shares to be purchased and submit the subscription price to the
subscription agent.
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PLAN OF DISTRIBUTION
We may sell the offered securities as follows:
. directly to one or more purchasers;
. through agents;
. to and through one or more dealers;
. to and through one or more underwriters;
. through a distribution of subscription rights to our stockholders; or
. through a combination of any such methods of sale.
The distribution of the offered securities pursuant to any applicable
prospectus supplement may be effected from time to time in one or more
transactions either:
. at a fixed price or prices which may be changed;
. at market prices prevailing at the time of sale;
. at prices related to such prevailing market prices; or
. at negotiated prices.
Offers to purchase the offered securities may be solicited directly by us.
Offers to purchase may also be solicited by agents designated by us from time
to time. Any such agent, who may be deemed to be an "underwriter" as that term
is defined in the Securities Act, involved in the offer or sale of the offered
securities in respect of which this prospectus is delivered will be named, and
any commissions which shall be payable by us to such agent will be set forth,
in the applicable prospectus supplement.
If a dealer is utilized in the sale of the offered securities, we will sell
the securities to the dealer, as principal. The dealer, who may be deemed to
be an "underwriter" as that term is defined in the Securities Act, may then
resell the securities to the public at varying prices to be determined by such
dealer at the time of resale.
If an underwriter is, or underwriters are, utilized in the sale of the
offered securities, we will execute an underwriting agreement with such
underwriters at the time of such sale to them and the names of the
underwriters will be set forth in the applicable prospectus supplement, which
will be used by the underwriters to make resales of the offered securities. In
connection with the sale of offered securities, such underwriters may be
deemed to have received compensation from us in the form of underwriting
discounts or commissions and may also receive commissions from purchasers of
debt securities and common stock for whom they may act as agents. Underwriters
may sell offered securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act
as agents. Any underwriting compensation paid by us to underwriters in
connection with the offering of securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers, will be set
forth in the applicable prospectus supplement.
Underwriters, dealers, agents and other persons may be entitled, under
agreements that may be entered into with us, to indemnification by us against
certain civil liabilities, including liabilities under the Securities Act, or
to contribution with respect to payments which they may be required to make in
respect thereof. Underwriters and agents may also engage in transactions with,
or perform services for us in the ordinary course of business.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters, dealers or other persons to solicit offers by certain
institutions to purchase offered securities from us pursuant to contracts
providing for payment and delivery on a future date or dates set forth in the
applicable prospectus supplement. Institutions with which such contracts may
be made may include, but are not limited to, commercial and savings
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banks, insurance companies, pension funds, investment companies, educational
and charitable institutions and others. The obligations of any purchaser under
any such contract will not be subject to any conditions except that the
purchase of offered securities shall not at the time of delivery be prohibited
under the laws of the jurisdiction to which such purchaser is subject, and if
the offered securities are also being sold to underwriters, we shall have sold
to such underwriters the offered securities not sold for delayed delivery. The
underwriters, dealers and such other persons will not have any responsibility
in respect to the validity or performance of such contracts. The prospectus
supplement relating to such contracts will set forth the price to be paid for
offered securities pursuant to such contracts, the commissions payable for
solicitation of such contracts and the date or dates in the future for
delivery of offered securities pursuant to such contracts.
The anticipated date of delivery of offered securities will be set forth in
the applicable prospectus supplement relating to each offer.
LEGAL MATTERS
Certain legal matters in connection with the validity of offered securities
to which this prospectus relates will be passed upon for us by Christensen,
Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP. Terry N. Christensen, a
partner of Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP, is
a member of our board of directors, and he and other attorneys in that firm
beneficially owned an aggregate of 14,618 shares of our common stock as of
March 23, 2000. Certain legal matters will be passed on for the underwriters
by Gibson, Dunn & Crutcher LLP, Los Angeles, California.
EXPERTS
The audited consolidated financial statements and schedule of MGM Grand,
Inc. incorporated by reference in this prospectus, have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their reports
with respect thereto, and are incorporated herein by reference in reliance
upon the authority of said firm as experts in accounting and auditing in
giving said reports. Reference is made to said report which includes an
explanatory paragraph with respect to the change in accounting for start-up
activities in 1999 as discussed in Note 2 to the consolidated financial
statements.
The audited consolidated financial statements and schedule of Mirage
Resorts, Incorporated, incorporated by reference in this prospectus, have been
audited by Arthur Andersen LLP, independent public accountants, as indicated
in their report with respect thereto, and is incorporated herein by reference
in reliance upon the authority of said firm as experts in accounting and
auditing in giving said report. Reference is made to said report which
includes an explanatory paragraph with respect to the change in accounting for
start-up activities in 1999 as discussed in Note 2 to the consolidated
financial statements.
WHERE YOU CAN FIND MORE INFORMATION
Each of MGM Grand and Mirage files annual, quarterly and special reports,
proxy statements and other information with the Securities and Exchange
Commission. You may read and copy, at prescribed rates, any document MGM Grand
or Mirage files at the Commission's public reference rooms in Washington,
D.C., New York, New York and Chicago, Illinois. Please call the Commission at
1-800-SEC-0330 (1-800-732-0330) for further information on the public
reference rooms. The Commission also maintains a website that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission (http://www.sec.gov).
You also may read and copy reports and other information filed by MGM Grand or
Mirage at the office of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005. You may also read reports, proxy statements and
other information relating to Mirage at the offices of the Pacific Exchange at
310 Pine Street, San Francisco, California 94104.
We have filed a registration statement and related exhibits with the
Commission under the Securities Act of 1933. The registration statement
contains additional information about us and our debt securities and common
stock. You may inspect the registration statement and its exhibits without
charge at the office of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and obtain copies, at prescribed rates, from the Commission.
26
<PAGE>
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Commission allows us to "incorporate by reference" information filed
with it, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information filed later by MGM Grand
or Mirage with the Commission will automatically update and supersede this
information.
We incorporate by reference the documents listed below and any future
filings made with the Commission under Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934:
. Our Annual Report on Form 10-K for the year ended December 31, 1999;
. Our Current Reports on Form 8-K dated February 23, 2000, February 28,
2000 and March 6, 2000;
. Mirage Resorts, Incorporated Annual Report on Form 10-K for the year
ended December 31, 1999;
. Mirage Resorts, Incorporated Proxy Statement filed with the Commission
on February 23, 2000; and
. Mirage Resorts, Incorporated Registration Statement on Form 8-A12B filed
with the Commission on March 10, 2000.
All documents and reports filed by MGM Grand or Mirage pursuant to Section
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 after the
date of this prospectus and on or prior to the termination of the offering of
the offered securities made by this prospectus are deemed to be incorporated
by reference in this prospectus from the date of filing of such documents or
reports, except as to any portion of any future annual or quarterly reports or
proxy statements which is not deemed to be filed under those sections. Any
statement contained in a document incorporated or deemed to be incorporated by
reference in this prospectus will be deemed to be modified or superceded for
purposes of this prospectus to the extent that any statement contained herein
in any prospectus supplement or in any other subsequently filed document which
also is or is deemed to be incorporated by reference in this prospectus
modifies or supercedes such statement. Any statement so modified or superceded
will not be deemed, except as so modified or superceded, to constitute a part
of this prospectus.
Any person receiving a copy of this prospectus may obtain, without charge,
upon written or oral request, a copy of any of the documents incorporated by
reference except for the exhibits to such documents (other than the exhibits
expressly incorporated in such documents by reference). Requests should be
directed to: Scott Langsner, Secretary, MGM Grand, Inc., 3799 Las Vegas
Boulevard South, Las Vegas, Nevada 89109; telephone number: (702) 891-3333. A
copy will be provided by first class mail or other equally prompt means within
one business day after receipt of your request.
27
<PAGE>
PART II
Information Not Required in Prospectus
Item 14. Other expenses of issuance and distribution
The following is a statement of estimated fees and expenses, other than
underwriting discounts and commissions, payable or reimbursable by MGM Grand,
Inc. in connection with the issuance and distribution of the offered
securities, subject to future contingencies.
<TABLE>
<S> <C>
Commission registration fee......................................... $ 726,000
Printing and shipping expenses...................................... 75,000
Accountants' fees and expenses...................................... 150,000
Legal fees and expenses............................................. 400,000
Blue Sky qualification fees and expenses............................ 20,000
Listing fees........................................................ 150,000
Trustee fees........................................................ 75,000
Miscellaneous ...................................................... 404,000
----------
Total........................................................... $2,000,000
==========
</TABLE>
Item 15. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of Delaware
provides that a Delaware corporation may indemnify any person against
expenses, judgments, fines and amounts paid in settlements actually and
reasonably incurred by any such person in connection with a threatened,
pending or completed action, suit or proceeding, other than an action, suit or
proceeding in the name of the corporation, in which he is involved by reason
of the fact that he is or was a director, officer, employee or agent of such
corporation, provided that (i) he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and (ii) with respect to any criminal action or proceeding, he had
no reasonable cause to believe his conduct was unlawful. If the action or suit
is by or in the name of the corporation, the corporation may indemnify any
such person against expenses actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted
in good faith and in a manner he reasonably believed to be in the best
interests of the corporation, except that no indemnification may be made in
respect to any claim, issue or matter as to which such person shall have been
adjudged to be liable for negligence or misconduct in the performance of his
duty to the corporation, unless and only to the extent that the Delaware Court
of Chancery or the court in which the action or suit is brought determines
upon application that, despite the adjudication of the liability but in light
of the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expense as the court deems proper.
Article II, Section 12 of the Bylaws of MGM Grand provides for
indemnification of persons to the extent permitted by the Delaware General
Corporation Law.
In accordance with Section 102(b)(7) of the Delaware Law, the Certificate
of Incorporation, as amended, of MGM Grand limits the personal liability of
its directors for violations of their fiduciary duty. The Certificate of
Incorporation eliminates each director's liability to MGM Grand or its
stockholders for monetary damages except (i) for any breach of the director's
duty of loyalty to MGM Grand or its stockholders, (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under the section of the Delaware law providing for
liability of directors for unlawful payment of dividends or unlawful stock
purchases or redemptions, or (iv) for any transaction from which a director
derived an improper personal benefit. The effect of this provision is to
eliminate the personal liability of directors for monetary damages for actions
involving a breach of their fiduciary duty of care, including any such actions
involving gross negligence. This provision will not, however, limit in any way
the liability of directors for violations of the Federal securities laws.
II-1
<PAGE>
MGM Grand carries directors and officers liability insurance policies which
are maintained in effect on a yearly basis.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling MGM Grand
pursuant to the foregoing provisions, MGM Grand has been informed that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
Item 16. Exhibits
<TABLE>
<C> <S>
*1 Form of Underwriting Agreement
2 Agreement and Plan of Merger, dated as of March 6, 2000, by and among
Mirage Resorts, Incorporated, MGM Grand, Inc. and MGMGMR Acquisition,
Inc. (incorporated by reference to exhibit 2 to MGM Grand's Current
Report on Form 8-K dated March 6, 2000.)
4 Form of indenture, including form of debt securities
*5 Opinion of Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro,
LLP.
*8 Opinion re tax matters
12 Computation of ratio of earnings to fixed charges
23.1 Consent of Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro,
LLP (set forth as part of Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Arthur Andersen LLP.
24 Power of attorney (see signature pages)
**25 Statement of eligibility of trustee on Form T-1
</TABLE>
- --------
* To be filed by amendment or as an exhibit to a document to be incorporated
by reference herein in connection with the offered securities.
** To be filed pursuant to Section 305(b)(2) of the Trust Indenture Act of
1939, as amended.
Item 17. Undertakings
(a) MGM Grand hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
Provided, however, that the undertakings set forth in paragraphs (a)(1)(i) and
(a)(1)(ii) of this section do not apply if the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by MGM Grand
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the Registration Statement.
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) MGM Grand hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of MGM Grand's annual
report on Form 10-K pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
MGM Grand pursuant to the foregoing provisions, or otherwise, MGM Grand has
been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by MGM Grand
of expenses incurred or paid by a director, officer or controlling person of
MGM Grand in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with
the securities being registered, MGM Grand will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication for such issue.
(i) MGM Grand hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by MGM Grand pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act of 1933 shall be deemed to be part of
this registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement related to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(j) MGM Grand hereby undertakes to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of
section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under section 305(b)(2) of the Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand, Inc. certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
MGM GRAND, INC.
By: /s/ James J. Murren
----------------------------------
James J. Murren
President and Chief Financial
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ J. Terrence Lanni Chairman of the Board March 23, 2000
____________________________________
J. Terrence Lanni
/s/ John T. Redmond Co-Chief Executive Officer March 23, 2000
____________________________________ and Director (Principal
John T. Redmond Executive Officer)
s/ Daniel M. Wade Co-Chief Executive Officer March 23, 2000
____________________________________ and Director (Principal
Daniel M. Wade Executive Officer)
/s/ James J. Murren President, Chief Financial March 23, 2000
____________________________________ Officer and Director
James J. Murren (Principal Financial and
Accounting Officer)
/s/ James D. Aljian Director March 23, 2000
____________________________________
James D. Aljian
/s/ Fred Benninger Director March 23, 2000
____________________________________
Fred Benninger
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Terry N. Christensen Director March 23, 2000
____________________________________
Terry N. Christensen
/s/ Glenn A. Cramer Director March 23, 2000
____________________________________
Glenn A. Cramer
Director March , 2000
____________________________________
Willie D. Davis
Director March , 2000
____________________________________
Alexander M. Haig, Jr.
Director March , 2000
____________________________________
Kirk Kerkorian
Director March , 2000
____________________________________
Walter M. Sharp
/s/ Alex Yemenidjian Director March 23, 2000
____________________________________
Alex Yemenidjian
/s/ Jerome B. York Director March 23, 2000
____________________________________
Jerome B. York
</TABLE>
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Hotel, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
MGM GRAND HOTEL, INC.
By: /s/ William J. Hornbuckle
----------------------------------
William J. Hornbuckle
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William J. Hornbuckle President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
William J. Hornbuckle Executive Officer)
/s/ Corey Sanders Senior Vice President and March 23, 2000
____________________________________ Chief Financial Officer
Corey Sanders (Principal Financial and
Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
/s/ John T. Redmond Director March 23, 2000
____________________________________
John T. Redmond
</TABLE>
II-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Movieworld, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGM GRAND MOVIEWORLD, INC.
By: /s/ William J. Hornbuckle
----------------------------------
William J. Hornbuckle
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William J. Hornbuckle President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
William J. Hornbuckle Executive Officer)
/s/ Corey Sanders Senior Vice President and March 23, 2000
____________________________________ Chief Financial Officer
Corey Sanders (Principal Financial and
Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
Director March , 2000
____________________________________
John T. Redmond
</TABLE>
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Grand Laundry, Inc. certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
GRAND LAUNDRY, INC.
By: /s/ William J. Hornbuckle
----------------------------------
William J. Hornbuckle
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William J. Hornbuckle President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
William J. Hornbuckle Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
Director March , 2000
____________________________________
John T. Redmond
</TABLE>
II-8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Monorail, Inc. certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
MGM GRAND MONORAIL, INC.
By: /s/ Daniel M. Wade
----------------------------------
Daniel M. Wade
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Daniel M. Wade President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
Daniel M. Wade Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
Director March , 2000
____________________________________
John T. Redmond
</TABLE>
II-9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Dist., Inc. certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
MGM DIST., INC.
By: /s/ Daniel M. Wade
----------------------------------
Daniel M. Wade
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Daniel M. Wade President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
Daniel M. Wade Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
Director March , 2000
____________________________________
John T. Redmond
</TABLE>
II-10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Destron, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Las Vegas, State of Nevada on March
23, 2000.
DESTRON, INC.
By: /s/ Robert V. Moon
----------------------------------
Robert V. Moon
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Robert V. Moon President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
Robert V. Moon Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
Director March , 2000
____________________________________
John T. Redmond
</TABLE>
II-11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Destron Marketing, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
DESTRON MARKETING, INC.
By: /s/ Robert V. Moon
----------------------------------
Robert V. Moon
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Robert V. Moon President (Principal March 23, 2000
____________________________________ Executive Officer)
Robert V. Moon
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
/s/ John T. Redmond Director March 23, 2000
____________________________________
John T. Redmond
</TABLE>
II-12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Merchandising, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGM GRAND MERCHANDISING, INC.
By: /s/ William J. Hornbuckle
----------------------------------
William J. Hornbuckle
President
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William J. Hornbuckle President (Principal March 23, 2000
____________________________________ Executive Officer)
William J. Hornbuckle
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
/s/ James J. Murren Director March 23, 2000
____________________________________
James J. Murren
/s/ John T. Redmond Director March 23, 2000
____________________________________
John T. Redmond
</TABLE>
II-13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Entertainment, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGM GRAND ENTERTAINMENT, INC.
By: /s/ Richard Sturm
----------------------------------
Richard Sturm
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Richard Sturm President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
Richard Sturm Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Daniel M. Wade Chairman March 23, 2000
____________________________________
Daniel M. Wade
Director March , 2000
____________________________________
James J. Murren
/s/ John T. Redmond Director March 23, 2000
____________________________________
John T. Redmond
</TABLE>
II-14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Atlantic City, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGM GRAND ATLANTIC CITY, INC.
By: /s/ James J. Murren
----------------------------------
James J. Murren
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ James J. Murren President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
James J. Murren Executive Officer)
/s/ Scott Langsner Secretary/Treasurer and March 23, 2000
____________________________________ Chief Financial Officer
Scott Langsner (Principal Financial and
Accounting Officer)
/s/ James J. Murren Chairman March 23, 2000
____________________________________
James J. Murren
/s/ John T. Redmond Director March 23, 2000
____________________________________
John T. Redmond
/s/ Daniel M. Wade Director March 23, 2000
____________________________________
Daniel M. Wade
</TABLE>
II-15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, MGM
Grand Development, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGM GRAND DEVELOPMENT, INC.
By: /s/ Kenneth A. Rosevear
----------------------------------
Kenneth A. Rosevear
President and Chief Operating
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Kenneth A. Rosevear President and Chief March 23, 2000
____________________________________ Operating Officer (Principal
Kenneth A. Rosevear Executive Officer)
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Kenneth A. Rosevear Chairman March 23, 2000
____________________________________
Kenneth A. Rosevear
/s/ Scott Langesner Director March 23, 2000
____________________________________
Scott Langsner
</TABLE>
II-16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
MGMGMR Acquisition, Inc., certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Las Vegas, State of
Nevada on March 23, 2000.
MGMGMR ACQUISITION, INC.
By: /s/ Scott Langsner
----------------------------------
Scott Langsner
President
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints James Murren and Scott Langsner their
true and lawful attorneys-in-fact and agents, each with full power and
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and any additional Registration Statements pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitution
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Scott Langsner President (Principal March 23, 2000
____________________________________ Executive Officer)
Scott Langsner
/s/ Scott Langsner Secretary/Treasurer March 23, 2000
____________________________________ (Principal Financial and
Scott Langsner Accounting Officer)
/s/ Scott Langsner Director March 23, 2000
____________________________________
Scott Langsner
</TABLE>
II-17
<PAGE>
EXHIBIT INDEX
<TABLE>
<C> <S>
*1 Form of Underwriting Agreement
2 Agreement and Plan of Merger, dated as of March 6, 2000, by and among
Mirage Resorts, Incorporated, MGM Grand, Inc. and MGMGMR Acquisition,
Inc. (incorporated by reference to exhibit 2 to MGM Grand's Current
Report on Form 8-K dated March 6, 2000.)
4 Form of indenture, including form of debt securities
*5 Opinion of Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro,
LLP.
*8 Opinion re tax matters
12 Computation of ratio of earnings to fixed charges
23.1 Consent of Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro,
LLP (set forth as part of Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
24 Power of attorney (see signature pages)
**25 Statement of eligibility of trustee on Form T-1
</TABLE>
- --------
* To be filed by amendment or as an exhibit to a document to be incorporated
by reference herein in connection with the offered securities.
** To be filed pursuant to Section 305(b)(2) of the Trust Indenture Act of
1939, as amended.
<PAGE>
EXHIBIT 4
INDENTURE
between
MGM GRAND, INC.
and
_________________________, as Trustee
Dated as of ______________, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION........ 1
Section 1.1 DEFINITIONS.............................................. 1
Section 1.2 COMPLIANCE CERTIFICATES AND OPINIONS..................... 8
Section 1.3 FORM OF DOCUMENTS DELIVERED TO TRUSTEE................... 9
ARTICLE 2 DEBT SECURITY FORMS............................................ 9
Section 2.1 FORMS GENERALLY.......................................... 9
Section 2.2 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.......... 10
Section 2.3 SECURITIES IN GLOBAL FORM................................ 10
ARTICLE 3 THE DEBT SECURITIES............................................ 11
Section 3.1 AMOUNT UNLIMITED; ISSUABLE IN SERIES..................... 11
Section 3.2 DENOMINATIONS............................................ 14
Section 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING........... 14
Section 3.4 TEMPORARY DEBT SECURITIES; EXCHANGE OF TEMPORARY
GLOBAL NOTES FOR DEFINITIVE DEBT SECURITIES; GLOBAL
NOTES REPRESENTING DEBT SECURITIES....................... 15
Section 3.5 REGISTRATION, TRANSFER AND EXCHANGE...................... 17
Section 3.6 MUTILATED, DESTROYED, LOST AND STOLEN DEBT SECURITIES.... 18
Section 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED........... 18
Section 3.8 CANCELLATION............................................. 19
Section 3.9 COMPUTATION OF INTEREST.................................. 20
Section 3.10 MANDATORY DISPOSITION OF DEBT SECURITIES PURSUANT TO
GAMING LAWS.............................................. 20
ARTICLE 4 SATISFACTION AND DISCHARGE..................................... 20
Section 4.1 SATISFACTION AND DISCHARGE OF INDENTURE.................. 20
Section 4.2 APPLICATION OF TRUST MONEY............................... 22
ARTICLE 5 REMEDIES....................................................... 22
Section 5.1 EVENTS OF DEFAULT........................................ 22
Section 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT....... 23
Section 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT
BY TRUSTEE............................................... 24
Section 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM......................... 24
Section 5.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
DEBTSECURITIES........................................... 25
Section 5.6 APPLICATION OF MONEY COLLECTED........................... 25
Section 5.7 LIMITATION ON SUITS...................................... 26
Section 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST..................................... 26
Section 5.9 RESTORATION OF RIGHTS AND REMEDIES....................... 26
Section 5.10 RIGHTS AND REMEDIES CUMULATIVE........................... 27
Section 5.11 DELAY OR OMISSION NOT WAIVER............................. 27
Section 5.12 CONTROL BY HOLDERS....................................... 27
Section 5.13 WAIVER OF PAST DEFAULTS.................................. 27
Section 5.14 UNDERTAKING FOR COSTS.................................... 28
Section 5.15 WAIVER OF STAY OR EXTENSION LAWS......................... 28
ARTICLE 6 THE TRUSTEE.................................................... 28
Section 6.1 CERTAIN DUTIES AND RESPONSIBILITIES...................... 28
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Section 6.2 NOTICE OF DEFAULTS....................................... 29
Section 6.3 CERTAIN RIGHTS OF TRUSTEE................................ 30
Section 6.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF DEBT
SECURITIES............................................... 31
Section 6.5 MAY HOLD DEBT SECURITIES................................. 31
Section 6.6 MONEY HELD IN TRUST...................................... 31
Section 6.7 COMPENSATION AND REIMBURSEMENT........................... 31
Section 6.8 DISQUALIFICATION; CONFLICTING INTERESTS.................. 32
Section 6.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.................. 33
Section 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR........ 33
Section 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR................... 35
Section 6.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS................................................. 36
Section 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY........ 36
Section 6.14 APPOINTMENT OF AUTHENTICATING AGENT...................... 37
ARTICLE 7 HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY.............. 38
Section 7.1 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
HOLDERS.................................................. 38
Section 7.2 PRESERVATION OF INFORMATION; COMMUNICATION TO HOLDERS.... 39
Section 7.3 REPORTS BY TRUSTEE....................................... 40
Section 7.4 REPORTS BY COMPANY....................................... 42
ARTICLE 8 CONCERNING THE HOLDERS......................................... 42
Section 8.1 ACTS OF HOLDERS.......................................... 42
Section 8.2 PROOF OF OWNERSHIP; PROOF OF EXECUTION OF INSTRUMENTS BY
HOLDER................................................... 42
Section 8.3 PERSONS DEEMED OWNERS.................................... 43
Section 8.4 REVOCATION OF CONSENTS; FUTURE HOLDERS BOUND............. 43
ARTICLE 9 HOLDERS' MEETINGS.............................................. 43
Section 9.1 PURPOSES OF MEETINGS..................................... 43
Section 9.2 CALL OF MEETINGS BY TRUSTEE.............................. 44
Section 9.3 CALL OF MEETINGS BY COMPANY OR HOLDERS................... 44
Section 9.4 QUALIFICATIONS FOR VOTING................................ 44
Section 9.5 REGULATIONS.............................................. 44
Section 9.6 VOTING................................................... 45
Section 9.7 NO DELAY OF RIGHTS BY MEETING............................ 45
ARTICLE 10 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.......... 46
Section 10.1 COMPANY MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS...... 46
Section 10.2 SUCCESSOR CORPORATION SUBSTITUTED........................ 46
ARTICLE 11 SUPPLEMENTAL INDENTURES....................................... 46
Section 11.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
HOLDERS.................................................. 46
Section 11.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.......... 47
Section 11.3 EXECUTION OF SUPPLEMENTAL INDENTURES..................... 48
Section 11.4 EFFECT OF SUPPLEMENTAL INDENTURES........................ 48
Section 11.5 CONFORMITY WITH TRUST INDENTURE ACT...................... 49
Section 11.6 REFERENCE IN DEBT SECURITIES TO SUPPLEMENTAL
INDENTURES............................................... 49
ARTICLE 12 COVENANTS..................................................... 49
Section 12.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST............... 49
Section 12.2 OFFICER'S CERTIFICATE AS TO COMPLIANCE................... 49
Section 12.3 MAINTENANCE OF OFFICE OR AGENCY.......................... 49
Section 12.4 MONEY FOR DEBT SECURITIES; PAYMENTS TO BE HELD IN TRUST.. 50
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Section 12.5 CORPORATE EXISTENCE...................................... 51
Section 12.6 WAIVER OF CERTAIN COVENANTS.............................. 51
ARTICLE 13 REDEMPTION OF DEBT SECURITIES................................. 51
Section 13.1 APPLICABILITY OF ARTICLE................................. 52
Section 13.2 ELECTION TO REDEEM; NOTICE TO TRUSTEE.................... 52
Section 13.3 SELECTION BY TRUSTEE OF DEBT SECURITIES TO BE REDEEMED... 52
Section 13.4 NOTICE OF REDEMPTION..................................... 52
Section 13.5 DEPOSIT OF REDEMPTION PRICE.............................. 53
Section 13.6 DEBT SECURITIES PAYABLE ON REDEMPTION DATE............... 53
Section 13.7 DEBT SECURITIES REDEEMED IN PART......................... 54
ARTICLE 14 SINKING FUNDS................................................. 54
Section 14.1 APPLICABILITY OF ARTICLE................................. 54
Section 14.2 SATISFACTION OF MANDATORY SINKING FUND PAYMENTS WITH
DEBT SECURITIES.......................................... 54
Section 14.3 REDEMPTION OF DEBT SECURITIES FOR SINKING FUND........... 55
ARTICLE 15 DEFEASANCE.................................................... 56
Section 15.1 APPLICABILITY OF ARTICLE................................. 56
Section 15.2 DEFEASANCE UPON DEPOSITS OF MONEYS OR U.S. GOVERNMENT
OBLIGATIONS.............................................. 56
Section 15.3 DEPOSITED MONEYS AND U.S. GOVERNMENT OBLIGATIONS TO
BE HELD IN TRUST......................................... 57
Section 15.4 REPAYMENT TO COMPANY..................................... 57
ARTICLE 16 CONVERSION.................................................... 58
Section 16.1 APPLICABILITY; CONVERSION PRIVILEGE...................... 58
Section 16.2 CONVERSION PROCEDURE; CONVERSION PRICE; FRACTIONAL
SHARES................................................... 58
Section 16.3 ADJUSTMENT OF CONVERSION PRICE FOR COMMON STOCK.......... 59
Section 16.4 CONSOLIDATION OR MERGER OF THE COMPANY................... 61
Section 16.5 NOTICE OF ADJUSTMENT..................................... 62
Section 16.6 NOTICE IN CERTAIN EVENTS................................. 62
Section 16.7 COMPANY TO RESERVE STOCK; REGISTRATION; LISTING.......... 63
Section 16.8 TAXES ON CONVERSION...................................... 63
Section 16.9 CONVERSION AFTER RECORD DATE............................. 63
Section 16.10 COMPANY DETERMINATION FINAL.............................. 64
Section 16.11 TRUSTEE'S DISCLAIMER..................................... 64
ARTICLE 17 GUARANTEES.................................................... 64
Section 17.1 APPLICABILITY OF ARTICLE................................. 64
Section 17.2 OBLIGOR GUARANTEE........................................ 64
Section 17.3 NOTICE OF OBLIGOR GUARANTEE.............................. 65
Section 17.4 AUTHORIZATION............................................ 65
Section 17.5 CERTAIN WAIVERS.......................................... 66
Section 17.6 NO SUBROGATION; CERTAIN AGREEMENTS....................... 67
Section 17.7 BANKRUPTCY NO DISCHARGE.................................. 67
Section 17.8 RIGHTS OF CONTRIBUTION................................... 68
Section 17.9 LIMITATION ON LIABILITY.................................. 69
Section 17.10 APPLICATION OF CERTAIN TERMS AND
PROVISIONS TO THE GUARANTORS............................. 69
Section 17.11 EXECUTION AND DELIVERY OF GUARANTEE...................... 69
Section 17.12 GUARANTOR MAY CONSOLIDATE, ETC. ON CERTAIN TERMS......... 69
Section 17.13 RELEASE OF GUARANTORS.................................... 69
Section 17.14 CERTAIN BANKRUPTCY EVENTS................................ 69
ARTICLE 18 MISCELLANEOUS................................................. 70
Section 18.1 NOTICES, ETC., TO TRUSTEE AND COMPANY.................... 70
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Section 18.2 NOTICE TO HOLDERS; WAIVER................................ 70
Section 18.3 CONFLICT WITH TRUST INDENTURE ACT........................ 71
Section 18.4 COUNTERPARTS; EFFECT OF HEADINGS AND TABLE OF CONTENTS... 71
Section 18.5 SUCCESSORS AND ASSIGNS................................... 71
Section 18.6 SEPARABILITY CLAUSE...................................... 71
Section 18.7 BENEFITS OF INDENTURE.................................... 71
Section 18.8 GOVERNING LAW............................................ 71
Section 18.9 LEGAL HOLIDAYS........................................... 72
Section 18.10 NO RECOURSE AGAINST OTHERS............................... 72
Section 18.11 GAMING LAWS.............................................. 72
</TABLE>
5
<PAGE>
Reconciliation between Trust Indenture Act of 1939
and Indenture, dated as of _________ __, 2000
-------------------------------
Trust Indenture
Act Section Indenture Section
Section 310
(a)(1) . . . . . . . . . . . . . . . 6.09
(a)(2) . . . . . . . . . . . . . . . 6.09
(a)(3) . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . Not Applicable
(a)(5) . . . . . . . . . . . . . . . 6.09
(b). . . . . . . . . . . . . . . . . 6.08, 6.10
(c). . . . . . . . . . . . . . . . . Not Applicable
Section 311
(a). . . . . . . . . . . . . . . . . 6.13(a)
(b). . . . . . . . . . . . . . . . . 6.13(b)
(c). . . . . . . . . . . . . . . . . Not Applicable
Section 312
(a). . . . . . . . . . . . . . . . . 7.01, 7.02(a)
(b). . . . . . . . . . . . . . . . . 7.02(b)
(c). . . . . . . . . . . . . . . . . 7.02(c)
Section 313
(a). . . . . . . . . . . . . . . . . 7.03(a)
(b). . . . . . . . . . . . . . . . . 7.03(b)
(c). . . . . . . . . . . . . . . . . 7.03(a), 7.03(c)
(d). . . . . . . . . . . . . . . . . 7.03(d)
Section 314
(a). . . . . . . . . . . . . . . . . 7.04, 12.02
(b). . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . 1.02
(c)(2) . . . . . . . . . . . . . . . 1.02
(c)(3) . . . . . . . . . . . . . . . Not Applicable
(d). . . . . . . . . . . . . . . . . Not Applicable
(e). . . . . . . . . . . . . . . . . 1.02
Section 315
(a). . . . . . . . . . . . . . . . . 6.01(a), 6.01(c)
(b). . . . . . . . . . . . . . . . . 6.02, 7.03(a)(7)
(c). . . . . . . . . . . . . . . . . 6.01(b)
(d)(1) . . . . . . . . . . . . . . . 6.01(a)
(d)(2) . . . . . . . . . . . . . . . 6.01(c)(2)
(d)(3) . . . . . . . . . . . . . . . 6.01(c)(3)
(e). . . . . . . . . . . . . . . . . 5.14
Section 316
(a)(1)(A). . . . . . . . . . . . . . 5.02, 5.12
(a)(1)(B). . . . . . . . . . . . . . 5.13
(a)(2) . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . 5.08
(c). . . . . . . . . . . . . . . . . Not Applicable
6
<PAGE>
Section 317
(a)(1) . . . . . . . . . . . . . . . 5.03
(a)(2) . . . . . . . . . . . . . . . 5.04
(b). . . . . . . . . . . . . . . . . 12.04
Section 318 . . . . . . . . . . . . 1.06
Note: This reconciliation shall not, for any purpose, be deemed to be a part of
the Indenture.
Attention should also be directed to Section 318(c) of the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"), which provides that the
provisions of Sections 310 to and including 317 of the Trust Indenture Act are a
part of and govern every qualified indenture, whether or not physically
contained therein.
7
<PAGE>
INDENTURE dated as of _______ __, 2000, by and between MGM GRAND, INC., a
Delaware corporation (the "Company"), having its principal executive office at
3799 Las Vegas Boulevard South, Las Vegas, Nevada 89109, and ___________________
(together with any additional trustees to be added by supplemental indenture
pursuant to this Indenture, the "Trustee"), having its Corporate Trust Office at
_____________________.
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures,
notes, bonds or other evidences of indebtedness (the "Debt Securities"), to be
issued in one or more series, as provided in this Indenture.
This Indenture is subject to the provisions of the Trust Indenture Act of
1939, as amended, that are deemed incorporated into this Indenture and shall, to
the extent applicable, be governed by such provisions.
All things necessary have been done to make this Indenture a valid
agreement of the Company, in accordance with its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Debt
Securities by the holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all holders of Debt Securities or of Debt
Securities of any series, as applicable, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1 DEFINITIONS; INTERPRETATION.
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For all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article, and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust Indenture Act,
either directly or by reference therein, have the meanings assigned to them
therein;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles or
as provided with respect to any series of Debt Securities, and, except as
otherwise herein provided or as provided with respect to any series of Debt
Securities, the term "generally accepted accounting principles" or "GAAP" with
respect to any computation required or permitted hereunder with respect to any
series of Debt Securities, shall mean such as set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
have been approved by a
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significant segment of the accounting profession which are in effect as of the
date of determination;
(d) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision;
(e) certain terms, used principally in Article Three or Article Six, are
defined in those respective Articles;
(f) "or" is not exclusive and "including" is not limiting;
(g) references in this Indenture to any agreement, other document or law "as
amended" or "as amended from time to time," or to "amendments" of any document
or law, shall include any amendments, supplements, replacements, renewals or
other modifications from time to time, provided in the case of modifications to
documents, such modifications are permissible hereunder;
(h) references in this Indenture to any law include regulations promulgated
thereunder from time to time;
(i) The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof; and
(j) The term "Act" when used with respect to any holder, has the meaning
specified in Section 8.1.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,
"controlled by" and "under common control with") as used with respect to any
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
agreement or otherwise.
"Authenticating Agent" has the meaning specified in Section 6.14.
"Authorized Newspaper" means a newspaper in an official language of the
country of publication customarily published at least once a day, and
customarily published for at least five days in each calendar week, and of
general circulation in the place in connection with which the term is used or in
the financial community of such place. Where successive publications are
required to be made in Authorized Newspapers, the successive publications may be
made in the same or in different newspapers in the same city meeting the
foregoing requirements and in each case on any Business Day in such city.
"Bankruptcy Code" means 11 U.S.C. (S)101 et seq., as amended from time to
time. ------
"Beneficiary" has the meaning specified in Section 17.2.
"Board of Directors" means either the board of directors of the Company or any
committee of that board or any other committee of the Company, duly authorized
by the board of directors of the Company to act hereunder.
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"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" when used with respect to any Place of Payment or any other
particular location referred to in this Indenture or in the Debt Securities
means any day which is not a Saturday, a Sunday or a legal holiday or a day on
which banking institutions or trust companies in that Place of Payment or other
location are authorized or obligated by law to close, except as otherwise
specified pursuant to Section 3.1.
"Closing Price" of the Common Stock shall mean the last reported sale price of
such stock (regular way) as shown on the Composite Tape of the New York Stock
Exchange Inc. or, in case no such sale takes place on such day, the average of
the closing bid and asked prices on the New York Stock Exchange, or if the
Common Stock is not then listed on the New York Stock Exchange on the principal
exchange (or NASDAQ--National Market System) on which the Common Stock is
listed.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties on such date.
"Common Depositary" has the meaning specified in Section 3.4(b).
"Common Stock" shall mean the class of Common Stock, par value $0.01 per
share, of the Company authorized at the date of this Indenture as originally
signed, or any other class of stock resulting from successive changes or
reclassifications of such Common Stock, and in any such case including any
shares thereof authorized after the date of this Indenture, and any other shares
of stock of the Company which do not have any priority in the payment of
dividends or upon liquidation over any other class of stock.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Request" and "Company Order" mean, respectively, a written request or
order signed in the name of the Company by the Chairman of the Board of
Directors, the President or an Executive or Senior Vice President and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the
Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee.
"Conversion Agent" means any Person authorized by the Company to receive Debt
Securities to be converted into Common Stock on behalf of the Company. The
Company initially authorizes the Trustee to act as Conversion Agent for the Debt
Securities on its behalf. The Company may at any time or from time to time
authorize one or more Persons to act as Conversion Agent in addition to or in
place of the Trustee with respect to any series of Debt Securities issued under
this Indenture.
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"Conversion Price" means, with respect to any series of Debt Securities which
are convertible into Common Stock, the price per share of Common Stock at which
the Debt Securities of such series are so convertible pursuant to Section 3.1
with respect to such series, as the same may be adjusted from time to time
in accordance with Section 16.3.
"Corporate Trust Office" means the principal corporate trust office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of execution of this instrument is
located at ________________________ ______________
"corporation" means a corporation, association, company or business trust.
"covenant defeasance option" has the meaning specified in Section 15.2.
"Current Market Price" on any date shall mean the average of the daily Closing
Prices per share of Common Stock for any thirty (30) consecutive Trading Days
selected by the Company prior to the date in question, which thirty (30)
consecutive Trading Day period shall not commence more than forty-five (45)
Trading Days prior to the day in question; provided that with respect to Section
16.3(c), the "Current Market Price" of the Common Stock shall mean the average
of the daily Closing Prices per share of Common Stock for the five (5)
consecutive Trading Days ending on the date of the distribution referred to in
Section 16.3(c) (or if such date shall not be a Trading Day, on the Trading Day
immediately preceding such date).
"Debt Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Debt Securities (including any Global
Note) authenticated and delivered under this Indenture; provided, however, that,
if at any time there is more than one Person acting as Trustee under this
Indenture, "Debt Securities" with respect to the Indenture as to which such
Person is Trustee shall have the meaning stated in the first recital of this
Indenture and shall more particularly mean Debt Securities authenticated and
delivered under this Indenture, exclusive, however, of Debt Securities of any
series as to which such Person is not Trustee.
"Default" means any event that after notice or lapse of time, or both, would
become an Event of Default.
"Defaulted Interest" has the meaning specified in Section 3.7(b).
"Discharged" has the meaning specified in Section 15.2.
"Discount Security" means any Debt Security which is issued with "original
issue discount" within the meaning of Section 1273(a) of the Code (or any
successor provision) and the regulations thereunder.
"Dollar" or "$" means a dollar or other equivalent unit in such coin or
currency of the United States that, at the time of payment, is legal tender for
the payment of public and private debts.
"Event of Default" has the meaning specified in Section 5.1.
"Floating Rate Security" means a Debt Security which provides for the payment
of interest at a variable rate determined periodically by
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reference to an interest rate index or any other index specified pursuant to
Section 3.1.
"Funding Guarantor" has the meaning specified in Section 17.8(a).
"Gaming Authority" means the Nevada Gaming Commission, the Nevada State Gaming
Control Board, the New Jersey Casino Control Commission, the New Jersey Division
of Gaming Enforcement or any similar commission or agency which has, or may at
any time after the date of this Indenture have, jurisdiction over the gaming
activities of the Company or a subsidiary of the Company or any successor
thereto.
"Gaming Laws" means the gaming laws of a jurisdiction or jurisdictions to
which the Company or a subsidiary of the Company is, or may at any time after
the date of this Indenture be, subject.
"Gaming Licenses" means every material license, material, franchise,
registration, or other material approval held by, or issued at any time after
the date of this Indenture, to the Company or any of its subsidiaries
authorizing the Company or any of its subsidiaries to own, lease, operate or
otherwise conduct or manage gaming in any state or jurisdiction.
"Global Note" means a registered Debt Security evidencing all or part of a
series of Debt Securities, including, without limitation, any temporary or
permanent Global Note.
"Guaranteed Securities" has the meaning specified in Section 17.2.
"Guarantor" means, with respect to the Debt Securities of any series, any
Person who has guaranteed the obligations of the Company under this Indenture
with respect to such series pursuant to Article 17, until released from such
guarantee pursuant to the terms of this Indenture.
"Indenture" means this instrument as originally executed, or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and, unless the
context otherwise requires, shall include the terms of a particular series of
Debt Securities as established pursuant to Section 3.1; provided, however, that,
if at any time more than one Person is acting as Trustee under this instrument,
"Indenture" shall mean, with respect to any one or more series of Debt
Securities for which such Person is Trustee, this instrument as originally
executed or as it may be supplemented or amended from time to time by one or
more indentures supplemental hereto entered into pursuant to the applicable
provisions hereof and shall include the terms of the, or those, particular
series of Debt Securities for which such Person is Trustee established as
contemplated by Section 3.1, exclusive, however, of any provisions or terms
which relate solely to other series of Debt Securities for which such Person is
Trustee, regardless of when such terms or provisions were adopted, and exclusive
of any provisions or terms adopted by means of one or more indentures
supplemental hereto executed and delivered after such Person had become such
Trustee but to which such Person, as such Trustee, was not a party.
"interest" when used with respect to a Discount Security which by its terms
bears interest only on a certain date, means interest payable after such date.
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"Interest Payment Date" with respect to any Debt Security means the Stated
Maturity of an installment of interest on such Debt Security.
"Joint Venture" means any partnership, corporation or other entity, in which
up to and including 50% of the partnership interests, outstanding voting stock
or other equity interests is owned, directly or indirectly, by the Company
and/or one or more subsidiaries.
"legal defeasance option" has the meaning specified in Section 17.2.
"mandatory sinking fund payment" has the meaning specified in Section 14.1.
"Maturity" when used with respect to any Debt Security means the date on which
the principal of such Debt Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption, repayment or repurchase at the
option of the holder thereof or otherwise.
"Maximum Net Worth" has the meaning specified in Section 17.8(b).
"Net Worth" has the meaning specified in Section 17.8(b).
"Obligations" has the meaning specified in Section 17.2.
"Obligor" means the Company or any Guarantor.
"Obligor Guarantee" has the meaning specified in Section 17.2.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board of Directors, the President or an Executive or Senior Vice President and
by the Treasurer, an Assistant Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary of the Company and delivered
to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel to
the Company (including an employee of the Company).
"Optional sinking fund payment" has the meaning specified in Section 14.1.
"Outstanding" when used with respect to Debt Securities, means, as of the date
of determination, all Debt Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Debt Securities theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Debt Securities for whose payment or redemption (including
repayment at the option of the holder) money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the holders of such Debt
Securities; provided, however, that if such Debt Securities are to be redeemed,
then notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made and the date for
such redemption has passed;
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(iii) Debt Securities, except to the extent provided in Section 15.2, with
respect to which the Company has effected defeasance as provided in Article
Fifteen;
(iv) Debt Securities which have been issued pursuant to Section 3.6 or in
exchange for or in lieu of which other Debt Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Debt Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Debt Securities are held by a bona fide purchaser
in whose hands such Debt Securities are valid obligations of the Company; and
(v) Debt Securities converted into Common Stock pursuant to or in accordance
with this Indenture;
Provided, however, that in determining whether the holders of the requisite
principal amount of Debt Securities Outstanding have performed any Act
hereunder, Debt Securities owned by the Company or any other obligor upon the
Debt Securities or any Affiliate of the Company or of such other obligor shall
be disregarded and deemed not to be Outstanding (provided, that in connection
with any offer by the Company or any obligor to purchase Debt Securities, Debt
Securities rendered by a holder shall be Outstanding until the date of
purchase), except that, in determining whether the Trustee shall be protected in
relying upon any such Act, only Debt Securities which the Trustee knows to be so
owned shall be so disregarded. Debt Securities so owned which have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right to act with respect to such Debt
Securities and that the pledgee is not the Company or any other obligor upon the
Debt Securities or any Affiliate of the Company or of such other obligor. In
determining whether the holders of the requisite principal amount of Outstanding
Debt Securities have performed any Act hereunder, the principal amount of a
Discount Security that shall be deemed to be Outstanding for such purpose shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the Maturity
thereof pursuant to Section 5.2.
"Overdue Rate" when used with respect to any series of the Debt Securities,
means the rate designated as such in or pursuant to the Board Resolution or the
supplemental indenture, as the case may be, relating to such series as
contemplated by Section 3.1.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Debt Securities on behalf
of the Company.
"permanent Global Note" shall have the meaning given such term in Section
3.4(b).
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint stock company, trust, estate,
unincorporated organization or government or any agency or political subdivision
thereof or any other entity.
"Place of Payment" when used with respect to the Debt Securities of any series
means the place or places where the principal of (and premium, if any) and
interest on the Debt Securities of that series are payable as specified pursuant
to Section 3.1.
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"Predecessor Security" of any particular Debt Security means every previous
Debt Security evidencing all or a portion of the same debt as that evidenced by
such particular Debt Security; and, for the purposes of this definition, any
Debt Security authenticated and delivered under Section 3.6 in lieu of a
mutilated, lost, destroyed or stolen Debt Security shall be deemed to evidence
the same debt as the mutilated, lost, destroyed or stolen Debt Security.
"principal" includes, with respect to Debt Securities of any series,
principal payable upon redemption or repurchase of Debt Securities of such
series.
"Redemption Date" means the date fixed for redemption of any Debt Security
pursuant to this Indenture.
"Redemption Price" means, in the case of a Discount Security, the amount of
the principal thereof that would be due and payable as of the Redemption Date
upon a declaration of acceleration pursuant to Section 5.2, and in the case of
any other Debt Security, the principal amount thereof, plus, in each case,
premium, if any, and accrued and unpaid interest, if any, to the Redemption
Date.
"Regular Record Date" for the interest payable on the Debt Securities of any
series on any Interest Payment Date means the date specified for the purpose
pursuant to Section 3.1 for such Interest Payment Date.
"Responsible Officer" when used with respect to the Trustee means any vice
president, the secretary, any assistant secretary or any assistant vice
president or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 3.5(a).
"Special Record Date" for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 3.7(b).
"Stated Maturity" when used with respect to any Debt Security or any
installment of principal thereof or premium thereon or interest thereon means
the date specified in such Debt Security representing such installment of
interest, as the date on which the principal of such Debt Security or such
installment of principal, premium or interest is due and payable.
"Subsidiary" means (i) a corporation a majority of whose capital stock with
voting power, under ordinary circumstances, to elect directors is at the time,
directly or indirectly, owned by the Company or (ii) any other Person, (other
than a corporation) in which the Company, directly or indirectly, has at least a
majority ownership interest.
"successor corporation" has the meaning specified in Section 10.1(a).
"temporary Global Note" has the meaning specified in Section 3.4(b).
"Trading Day" shall mean, with respect to the Common Stock, so long as the
Common Stock is listed or admitted to trading on the New York
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Stock Exchange, a day on which the New York Stock Exchange is open for the
transaction of business.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder, and if at any time there is
more than one such Person, then "Trustee" as used with respect to the Debt
Securities of any series shall mean the Trustee with respect to Debt Securities
of such series.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as it may be
amended from time to time.
"U.S. Depositary" means a clearing agency registered under the Securities
Exchange Act of 1934, as amended, or any successor thereto, which shall in
either case be designated by the Company pursuant to Section 3.1 until a
successor U.S. Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "U.S. Depositary" shall mean or
include each Person who is then a U.S. Depositary hereunder, and if at any time
there is more than one such Person, then "U.S. Depositary" as used with respect
to the Debt Securities of any series shall mean the U.S. Depositary with respect
to the Debt Securities of that series.
"U.S. Government Obligations" has the meaning specified in Section 15.2.
"Vice President" includes, with respect to the Company, any Executive or
Senior Vice President and includes, with respect to the Trustee, any Vice
President, whether or not designated by a number or word or words added before
or after the title "Vice President."
Section 1.2 COMPLIANCE CERTIFICATES AND OPINIONS.
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Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than certificates provided
pursuant to Section 12.2) shall include:
(a) a statement that each individual signing such certificate or opinion has
read such covenant or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
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(c) a statement that, in the opinion of each such individual, such
individual has made such examination or investigation as is necessary to enable
that individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual, such
condition or covenant has been complied with. provided, however, that with
respect to matters of law, an Officers' Certificate may be based upon an Opinion
of Counsel, unless the signers know, or in the exercise of reasonable care
should know, that such Opinion of Counsel is erroneous, and provided, further,
that with respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials, unless the signer
knows, or in the exercise of reasonable care should know, that any such document
is erroneous.
Section 1.3 FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
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In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
ARTICLE 2
DEBT SECURITY FORMS
Section 2.1 FORMS GENERALLY.
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The Debt Securities of each series shall be substantially in the form of
Exhibit A hereto or in such other form as shall be established in or pursuant to
a Board Resolution or one or more indentures supplemental hereto, and shall have
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture, and may have such letters, numbers
or other marks of identification or designation and such legends or endorsements
placed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Indenture, or as may be required to comply with any
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any securities exchange on which any series of the Debt Securities
may be listed, or to conform to usage, all as determined by the officers
executing such Debt Securities as conclusively evidenced by their execution such
Debt Securities. If the form of Debt Securities (or any Global Note) of any
series is established in or pursuant to a Board Resolution, a copy of such Board
Resolution shall be delivered to the Trustee, together with an Officers'
Certificate setting forth the form of such series, at or prior to the delivery
of the Company Order contemplated by Section 3.3 for the authentication and
delivery of such Debt Securities (or any such Global Note).
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Subject to Section 3.4, the definitive Debt Securities of each series shall be
printed, lithographed or engraved or produced by any combination of these
methods on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Debt Securities, as conclusively
evidenced by their execution of such Debt Securities.
Section 2.2 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
- -------------------------------------------------------------
The form of the Trustee's certificate of authentication to be borne by the
Debt Securities shall be substantially as follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the series of Debt Securities issued under the within
mentioned Indenture.
[NAME OF TRUSTEE], as Trustee
By: ____________________
Authorized Signatory
Section 2.3 SECURITIES IN GLOBAL FORM.
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If any Debt Security of a series is issued as a Global Note, such Global Note
may provide that it shall represent the aggregate amount of Outstanding Debt
Securities from time to time endorsed thereon and may also provide that the
aggregate amount of Outstanding Debt Securities represented thereby may from
time to time be reduced to reflect exchanges. Any endorsement of a Global Note
to reflect the amount, or any increase or decrease in the amount, of Outstanding
Debt Securities represented thereby shall be made by the Trustee and in such
manner as shall be specified in such Global Note. Any instructions by the
Company with respect to a Global Note, after its initial issuance, shall be in
writing but need not comply with Section 1.2.
Global Notes may be issued in either registered or bearer form and in either
temporary or permanent form. Permanent Global Notes will be issued in
definitive form.
Every Global Note authenticated and delivered hereunder shall bear a legend in
substantially the following form:
THIS DEBT SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS DEBT SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE
DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY DEBT SECURITY
AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN
EXCHANGE FOR OR IN LIEU OF, THIS DEBT SECURITY SHALL BE A GLOBAL NOTE SUBJECT TO
THE FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES.
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ARTICLE 3
THE DEBT SECURITIES
Section 3.1 AMOUNT UNLIMITED; ISSUABLE IN SERIES.
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The aggregate principal amount of Debt Securities which may be authenticated
and delivered under this Indenture is unlimited. The Debt Securities may be
issued in one or more series. There shall be established in or pursuant to a
Board Resolution and (subject to Section 3.3) set forth in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Debt Securities of any series:
(a) The title of the Debt Securities of the series (which shall distinguish
the Debt Securities of such series from all other series of Debt Securities);
(b) The aggregate principal amount of such series of Debt Securities and any
limit on the aggregate principal amount of the Debt Securities of the series
which may be authenticated and delivered under this Indenture (except for Debt
Securities authenticated and delivered upon transfer of, or in exchange for, or
in lieu of, other Debt Securities of such series pursuant to Sections 3.4, 3.5,
3.6, 11.6 or 13.7);
(c) The percentage of the principal amount at which the Debt Securities of
such series will be issued and, if other than the principal amount thereof, the
portion of the principal amount thereof payable upon declaration of acceleration
of the maturity or upon redemption thereof or the method by which such portion
shall be determined;
(d) The date or dates on which, or periods during which, the Debt
Securities of the series may be issued, and the date or dates or the method by
which such date or dates will be determined, on which the principal of (and
premium, if any, on) the Debt Securities of such series are or may be payable
(which, if so provided in such Board Resolution or supplemental indenture, may
be determined by the Company from time to time as set forth in the Debt
Securities of the series issued from time to time);
(e) The rate or rates (which may be fixed or variable) at which the Debt
Securities of the series shall bear interest, if any, or the method by which
such rate or rates shall be determined, the date or dates from which such
interest, if any, shall accrue or the method by which such date or dates shall
be determined (which, in either case or both, if so provided in such Board
Resolution or supplemental indenture, may be determined by the Company from time
to time and set forth in the Debt Securities of the series issued from time to
time) and the circumstances, if any, in which the Company may defer interest
payments; and the Interest Payment Dates on which such interest shall be payable
(or the method of determination thereof), and the Regular Record Dates, if any,
for the interest payable on such Interest Payment Dates and the notice, if any,
to holders regarding the determination of interest, the manner of giving such
notice, the basis upon which interest shall be calculated if other than that of
a 360-day year of twelve 30-day months and any conditions or contingencies as to
the payment of interest in cash or otherwise, if any;
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(f) The place or places, if any, in addition to or instead of the Corporate
Trust Office of the applicable Trustee where the principal of (and premium, if
any) and interest on Debt Securities of the series shall be payable and where
such Debt Securities may be surrendered for conversion or registration of
transfer or exchange; the extent to which, or the manner in which, any interest
payable on any Global Note on an Interest Payment Date will be paid, if other
than in the manner provided in Section 3.7; the extent, if any, to which the
provisions of the last sentence of Section 12.1 shall apply to the Debt
Securities of the series; and the manner in which any principal of, or premium,
if any, on, any Global Note will be paid, if other than as set forth elsewhere
herein and whether any Global Note will require any notation to evidence payment
of principal or interest;
(g) The obligation, if any, of the Company to redeem, repay, purchase or offer
to purchase Debt Securities of the series pursuant to any mandatory redemption,
sinking fund or analogous provisions or upon other conditions or at the option
of the holder thereof and the period or periods within which or the dates on
which, the prices at which and the terms and conditions upon which the Debt
Securities of the series shall be redeemed, repaid, purchased or offered to be
purchased, in whole or in part, pursuant to such obligation;
(h) The right, if any, of the Company to redeem the Debt Securities of such
series at its option and the period or periods within which, or the date or
dates on which, the price or prices at which, and the terms and conditions upon
which, such Debt Securities may be redeemed, if any, in whole or in part, at the
option of the Company or otherwise;
(i) The denominations of such Debt Securities if other than denominations of
$1,000 and any integral multiple thereof (except as provided in Section 3.4);
(j) Whether the Debt Securities of the series are to be issued as Discount
Securities and the amount of discount with which such Debt Securities may be
issued and, if other than the principal amount thereof, the portion of the
principal amount of Debt Securities of the series which shall be payable upon
declaration of acceleration of the Maturity thereof pursuant to Section 5.2;
(k) Additional provisions, if any, for the defeasance or discharge of certain
of the Company's obligations with respect to Debt Securities of the series,
which provisions may be in addition to, or in substitution for, or in
modification of (or any combination of the foregoing), the provisions of the
Indenture;
(l) Whether provisions for payment of additional amounts or tax redemptions
shall apply and, if such provisions shall apply, such provisions;
(m) The date as of which any Debt Securities of the series shall be dated, if
other than as set forth in Section 3.3;
(n) If the amount of payments of principal of (and premium, if any) orinterest
on the Debt Securities of the series may be determined with reference to an
index, including, but not limited to, an index based on a Currency or Currencies
other than that in which the Debt Securities are denominated or payable, or any
other type of index, the manner in which such amounts shall be determined;
(o) The applicable Overdue Rate, if any;
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(p) If the Debt Securities of the series do not bear interest, the
applicable dates for purposes of Section 7.1;
(q) Any addition to, or modification or deletion of, any Event of Default or
covenant provided for in this Indenture with respect to Debt Securities of the
series;
(r) Whether the Debt Securities of the series shall be issued in whole or in
part in the form of one or more Global Notes and, in such case, the U.S.
Depositary or any Common Depositary for such Global Note or Notes; and the
manner in which and the circumstances under which Global Notes representing Debt
Securities of the series may be exchanged for Debt Securities in definitive
form, if other than, or in addition to, the manner and circumstances specified
in Section 3.4(c);
(s) The designation, if any, of any depositaries, trustees (other than the
Trustee), Paying Agents, Authenticating Agents, Conversion Agents, Security
Registrars (other than the Trustee) or other agents with respect to the Debt
Securities of such series;
(t) If the Debt Securities of such series will be issuable in definitive form
only upon receipt of certain certificates or other documents or upon
satisfaction of certain conditions, the form and terms of such certificates,
documents or conditions;
(u) Whether the Debt Securities of such series will be convertible into shares
of Common Stock or other securities or property of the Company, and, if so, the
terms and conditions, which may be in addition to or in lieu of the provisions
contained in this Indenture, upon which such Debt Securities will be so
convertible, including the conversion price and the conversion period;
(v) The portion of the principal amount of the Debt Securities which will be
payable upon declaration of acceleration of the maturity thereof, if other than
the principal amount thereof;
(w) The terms, if any, on which the Debt Securities of such series will be
subordinate to other debt of the Company;
(x) Any listing or intended listing of the Debt Securities on a securities
exchange.
(y) The provisions, if any, relating to any security provided for the Debt
Securities of such series;
(z) The provisions, if any, relating to any guarantees of the Debt
Securities; and
(aa) Any other terms of the series (which terms shall not be inconsistent with
the provisions of this Indenture).
All Debt Securities of any one series shall be substantially identical except
as to denomination and except as may otherwise be provided in or pursuant to
such Board Resolution and (subject to Section 3.3) set forth in such Officers'
Certificate, or in any such indenture supplemental hereto. All Debt Securities
of any one series need not be issued at the same time, and unless otherwise
provided, a series may be reopened for issuance of additional Debt Securities of
such series.
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If any of the terms of a series of Debt Securities is established in or
pursuant to a Board Resolution, a copy of such Board Resolution shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
Section 3.2 DENOMINATIONS.
- ---------------------------
In the absence of any specification pursuant to Section 3.1 with respect to
the Debt Securities of any series, the Debt Securities of such series shall be
issuable only as Debt Securities in denominations of $1,000 and any integral
multiple thereof and shall be payable only in Dollars.
Section 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
- ------------------------------------------------------------
The Debt Securities of any series shall be executed on behalf of the
Company by its Chairman of the Board of Directors, its President, one of its
Executive or Senior Vice Presidents or its Treasurer, under its corporate seal
reproduced thereon and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers may be manual or facsimile.
Debt Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Debt Securities or did
not hold such offices at the date of such Debt Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Debt Securities of any series, executed by
the Company, to the Trustee for authentication, together with a Company Order
for the authentication and delivery of such Debt Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such Debt
Securities. If all the Debt Securities of any one series are not to be issued
at one time and if a Board Resolution or supplemental indenture relating to such
series shall so permit, such Company Order may set forth procedures acceptable
to the Trustee for the issuance of such Debt Securities such as interest rate,
Stated Maturity, date of issuance and date from which interest, if any, shall
accrue. If any Debt Security shall be represented by a permanent Global Note,
then, for purposes of this Section and Section 3.4, the notation of a beneficial
owner's interest therein upon original issuance of such Debt Security or upon
exchange of a portion of a temporary Global Note shall be deemed to be delivery
in connection with the original issuance of such beneficial owner's interest in
such permanent Global Note.
The Trustee shall be entitled to receive, and (subject to Section 6.1) shall
be fully protected in relying upon, prior to the authentication and delivery of
the Debt Securities of such series, (i) the supplemental indenture or the Board
Resolution by or pursuant to which the form and terms of such Debt Securities
have been approved, (ii) an Officers' Certificate stating that all conditions
precedent provided for in the Indenture have been complied with and that, to the
best knowledge of the signers of such certificates, no Event of Default with
respect to any of the Debt Securities shall have occurred and be
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continuing and (iii) an Opinion of Counsel substantially to the effect that:
(a) the form and terms of such Debt Securities, have been established in
conformity with the provisions of this Indenture; and
(b) such Debt Securities, when completed by appropriate insertions and
executed and delivered by the Company to the Trustee in accordance with the
Indenture, authenticated and delivered by the Trustee in accordance with this
Indenture and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute legal, valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, subject to applicable bankruptcy, insolvency, fraudulent transfer
and similar laws affecting creditors' rights generally and to general principles
of equity (regardless of whether enforcement is sought in a proceeding in equity
or at law).
The Trustee shall not be required to authenticate such Debt Securities if the
issuance of such Debt Securities pursuant to this Indenture will affect the
Trustee's own rights, duties or immunities under the Debt Securities and this
Indenture in a manner which is not reasonably acceptable to the Trustee.
Each Debt Security shall be dated the date of its authentication.
No Debt Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Debt Security a
certificate of authentication substantially in one of the forms provided for
herein duly executed by the Trustee or by an Authenticating Agent, and such
certificate upon any Debt Security shall be conclusive evidence, and the only
evidence, that such Debt Security has been duly authenticated and delivered
hereunder and is entitled to the benefits of this Indenture. Notwithstanding the
foregoing, if any Debt Security shall have been duly authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Debt Security to the Trustee for cancellation as provided in
Section 3.8 together with a written statement (which need not comply with
Section 1.2) stating that such Debt Security has never been issued and sold by
the Company, for all purposes of this Indenture such Debt Security shall be
deemed never to have been authenticated and delivered hereunder and shall never
be entitled to the benefits of this Indenture.
Section 3.4 TEMPORARY DEBT SECURITIES; EXCHANGE OF TEMPORARY GLOBAL NOTES FOR
DEFINITIVE DEBT SECURITIES; GLOBAL NOTES REPRESENTING DEBT SECURITIES.
- ---------------------------------------------------------------------
(a) Pending the preparation of definitive Debt Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Debt Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination for Debt
Securities of such series, substantially of the tenor of the definitive Debt
Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Debt Securities may determine, as conclusively evidenced by their
execution of such Debt Securities. Every such temporary Debt Security shall be
executed by the Company and shall be authenticated and delivered by the Trustee
upon the same conditions and in substantially the same manner, and with the same
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effect, as the definitive Debt Securities in lieu of which they are issued.
Except in the case of temporary Debt Securities in global form (which shall
be exchanged in accordance with the provisions of the following paragraphs), if
temporary Debt Securities of any series are issued, the Company will cause
definitive Debt Securities of such series to be prepared without unreasonable
delay. After the preparation of definitive Debt Securities of such series, the
temporary Debt Securities of such series shall be exchangeable for definitive
Debt Securities of such series, of a like Stated Maturity and with like terms
and provisions, upon surrender of the temporary Debt Securities of such series
at the office or agency of the Company in a Place of Payment for such series,
without charge to the holder, except as provided in Section 3.5 in connection
with a transfer. Upon surrender for cancellation of any one or more temporary
Debt Securities of any series, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Debt Securities of the same series of authorized denominations and of
a like Stated Maturity and like terms and provisions. Until so exchanged, the
temporary Debt Securities of any series shall in all respects be entitled to the
same benefits under this Indenture as definitive Debt Securities of such series.
(b) If the Company shall establish pursuant to Section 3.1 that the Debt
Securities of a series are to be issued in whole or in part in the form of one
or more Global Notes, then the Company shall execute and the Trustee shall, in
accordance with Section 3.3 and the Company Order with respect to such series,
authenticate and deliver one or more Global Notes in temporary or permanent form
that (i) shall represent and shall be denominated in an amount equal to the
aggregate principal amount of the Outstanding Debt Securities of such series to
be represented by one or more Global Notes, (ii) shall be registered in the name
of the U.S. Depositary for such Global Note or Notes or the nominee of such
depositary, and (iii) shall bear a legend substantially as set forth in Section
2.3.
Notwithstanding any other provision of this Section or Section 3.5, unless and
until it is exchanged in whole or in part for Debt Securities in definitive
form, a Global Note representing all or a portion of the Registered Securities
of a series may not be transferred except as a whole by the U.S. Depositary for
such series to a nominee of such depositary or by a nominee of such depositary
to such depositary or another nominee of such depositary or by such depositary
or any such nominee to a successor U.S. Depositary for such series or a nominee
of such successor depositary.
If at any time the U.S. Depositary for the Debt Securities of a series
notifies the Company that it is unwilling or unable to continue as U.S.
Depositary for the Debt Securities of such series or if at any time the U.S.
Depositary for Debt Securities of a series shall no longer be a clearing agency
registered and in good standing under the Securities Exchange Act of 1934, as
amended, or other applicable statute or regulation, the Company shall appoint a
successor U.S. Depositary with respect to the Debt Securities of such series.
If a successor U.S. Depositary for the Debt Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, the Company will execute, and the Trustee,
upon receipt of a Company Order for the authentication and delivery of
definitive Debt Securities of such series, will authenticate and deliver, Debt
Securities of such series in definitive form in an aggregate
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principal amount equal to the principal amount of the Global Note or Notes
representing such series in exchange for such Global Note or Notes.
The Company may at any time and in its sole discretion determine that the Debt
Securities of any series issued in the form of one or more Global Notes shall no
longer be represented by such Global Note or Notes. In such event, the Company
will execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of definitive Debt Securities of such series, will
authenticate and deliver, Debt Securities of such series in definitive form and
in an aggregate principal amount equal to the principal amount of the Global
Note or Notes representing such series in exchange for such Global Note or
Notes.
If the Debt Securities of any series shall have been issued in the form of one
or more Global Notes and if an Event of Default with respect to the Debt
Securities of such series shall have occurred and be continuing, the Company
will promptly execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of definitive Debt Securities of such series, will
authenticate and deliver, Debt Securities of such series in definitive form and
in an aggregate principal amount equal to the principal amount of the Global
Note or Notes representing such series in exchange for such Global Note or
Notes.
If specified by the Company pursuant to Section 3.1 with respect to Debt
Securities of a series, the U.S. Depositary for such series of Debt Securities
may surrender a Global Note for such series of Debt Securities in exchange in
whole or in part for Debt Securities of such series in definitive form on such
terms as are acceptable to the Company and such depositary. Thereupon, the
Company shall execute and the Trustee shall authenticate and deliver, without
charge:
(i) to each Person specified by the U.S. Depositary a new Debt
Security or Securities of the same series, of any authorized denomination as
requested by such Person in an aggregate principal amount equal to and in
exchange for such Person's beneficial interest in the Global Note; and
(ii) to the U.S. Depositary a new Global Note in a denomination equal to
the difference, if any, between the principal amount of the surrendered Global
Note and the aggregate principal amount of Debt Securities delivered to holders
thereof.
Upon the exchange of a Global Note for Debt Securities in definitive form,
such Global Note shall be cancelled by the Trustee. Debt Securities issued in
exchange for a Global Note pursuant to this subsection (c) shall be registered
in such names and in such authorized denominations as the U.S. Depositary for
such Global Note, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall
deliver such Debt Securities to the Persons in whose names such Debt Securities
are so registered.
Section 3.5 REGISTRATION, TRANSFER AND EXCHANGE.
- -------------------------------------------------
(a) The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the registers maintained in such office and in any other
office or agency of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Debt Securities and of transfers and exchanges of Debt
Securities. The Trustee is hereby appointed "Security Registrar" for the
purpose of registering Debt
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Securities and registering transfers and exchanges of Debt Securities as herein
provided; provided, however, that the Company may appoint co-Security Registrars
or the terms of any series of Debt Securities may provide otherwise.
Upon surrender for registration of transfer of any Debt Security of any
series at the office or agency of the Company maintained for such purpose, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee, one or more new Debt Securities of the same
series of like aggregate principal amount of such denominations as are
authorized for Debt Securities of such series and of a like Stated Maturity and
with like terms and conditions.
Except as otherwise provided in Section 3.4 and this Section 3.5, at the
option of the holder, Debt Securities of any series may be exchanged for other
Debt Securities of the same series of like aggregate principal amount and of a
like Stated Maturity and with like terms and conditions, upon surrender of the
Debt Securities to be exchanged at such office or agency. Whenever any Debt
Securities are surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Debt Securities which the holder
making the exchange is entitled to receive.
(b) All Debt Securities issued upon any transfer or exchange of Debt
Securities shall be valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Debt Securities
surrendered for such transfer or exchange.
Every Debt Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar, duly executed, by the holder thereof or his
or her attorney duly authorized in writing.
No service charge will be made for any transfer or exchange of Debt
Securities except as provided in Section 3.4(b) or 3.6. The Company may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration, transfer or exchange of Debt
Securities, other than those expressly provided in this Indenture to be made at
the Company's own expense or without expense or without charge to the holders.
The Company shall not be required (i) to register, transfer or
exchange Debt Securities of any series during a period beginning at the opening
of business 15 days before the day of the transmission of a notice of redemption
of Debt Securities of such series selected for redemption under Section 13.3 and
ending at the close of business on the day of such transmission, or (ii) to
register, transfer or exchange any Debt Security so selected for redemption in
whole or in part, except the unredeemed portion of any Debt Security being
redeemed in part.
Section 3.6 MUTILATED, DESTROYED, LOST AND STOLEN DEBT SECURITIES.
- -------------------------------------------------------------------
If (i) any mutilated Debt Security is surrendered to the Trustee at its
Corporate Trust Office, or (ii) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Debt Security, and
there is delivered to the Company and the Trustee such security or indemnity as
may be required by them to save each of them and any Paying Agent harmless, and
neither the Company nor the Trustee
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receives notice that such Debt Security has been acquired by a bona fide
purchaser, then the Company shall execute and upon Company Request, the Trustee
shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Debt Security, a new Debt Security of the
same series of like Stated Maturity and with like terms and conditions and like
principal amount, bearing a number not contemporaneously Outstanding.
In case any such mutilated, destroyed, lost or stolen Debt Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Debt Security, pay the amount due on such Debt
Security.
Upon the issuance of any new Debt Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in respect thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Debt Security of any series issued pursuant to this Section shall
constitute an original additional contractual obligation of the Company, whether
or not the destroyed, lost or stolen Debt Security shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Debt Securities of
that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Debt Securities.
Section 3.7 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
- ------------------------------------------------------------
(a) Interest on any Debt Security which is payable and is punctually paid or
duly provided for on any Interest Payment Date shall be paid to the Person in
whose name such Debt Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such interest
notwithstanding the cancellation of such Debt Security upon any transfer or
exchange subsequent to the Regular Record Date. Unless otherwise specified as
contemplated by Section 3.1 with respect to the Debt Securities of any series,
payment of interest on Debt Securities shall be made at the place or places
specified pursuant to Section 3.1 or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or, if provided pursuant to Section 3.1, by wire
transfer to an account designated by the registered holder.
(b) Any interest on any Debt Security which is payable but is not
punctually paid or duly provided for on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the registered
holder on the relevant Regular Record Date by virtue of his having been such
registered holder, and such Defaulted Interest may be paid by the Company, at
its election in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names such Debt Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company
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shall notify the Trustee in writing of the amount of Defaulted Interest proposed
to be paid on each such Debt Security and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be held
in trust for the benefit of the Persons entitled to such Defaulted Interest as
in this clause provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest. The Trustee shall promptly notify
the Company of such Special Record Date and, in the name and at the expense of
the Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class postage
prepaid, to the holders of such Debt Securities at their addresses as they
appear in the Security Register, not less than 15 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such Defaulted
Interest shall be paid to the Persons in whose names such Debt Securities (or
their respective Predecessor Securities) are registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to the
following clause (2).
(2) The Company may make payment of any Defaulted Interest on Debt
Securities in any other lawful manner not inconsistent with the requirements of
any securities exchange on which such Debt Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by the Trustee.
(c) Subject to the foregoing provisions of this Section, each Debt Security
delivered under this Indenture upon transfer of, in exchange for, or in lieu of,
any other Debt Security shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Debt Security.
Section 3.8 CANCELLATION.
- --------------------------
Unless otherwise specified pursuant to Section 3.1 for Debt Securities of any
series, all Debt Securities surrendered for payment, redemption, transfer,
exchange or credit against any sinking fund surrendered for payment or exchange
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee. All Debt Securities so delivered shall be promptly cancelled by the
Trustee. The Company may at any time deliver to the Trustee for cancellation
any Debt Securities previously authenticated and delivered hereunder which the
Company may have acquired in any manner whatsoever, and may deliver to the
Trustee (or to any other Person for delivery to the Trustee) for cancellation
any Debt Securities previously authenticated hereunder which the Company has not
issued, and all Debt Securities so delivered shall be promptly cancelled by the
Trustee. No Debt Securities shall be authenticated in lieu of or in exchange
for any Debt Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Debt Securities held by
the Trustee shall be delivered to the Company upon Company Request. The
acquisition of any Debt Securities by the Company shall not operate as a
redemption or satisfaction of the indebtedness represented thereby unless and
until such Debt Securities are surrendered to the Trustee for cancellation.
Permanent Global Notes
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shall not be destroyed until exchanged in full for definitive Debt Securities or
until payment thereon is made in full.
Section 3.9 COMPUTATION OF INTEREST.
- -------------------------------------
Except as otherwise specified pursuant to Section 3.1 for Debt Securities of
any series, interest on the Debt Securities of each series shall be computed on
the basis of a 360-day year of twelve 30-day months.
Section 3.10 MANDATORY DISPOSITION OF DEBT SECURITIES PURSUANT TO GAMING LAWS.
- ------------------------------------------------------------------------------
Each holder and beneficial owner, by accepting or otherwise acquiring an
interest in the Debt Securities, shall be deemed to have agreed that if the
Gaming Authority of any jurisdiction in which the Company or any of its
subsidiaries conducts or proposes to conduct gaming requires that a Person who
is a holder or beneficial owner must be licensed, qualified or found suitable
under the applicable Gaming Laws, such holder or beneficial owner shall apply
for a license, qualification or a finding of suitability within the required
time period. If such Person fails to apply or become licensed or qualified or
is found unsuitable, then the Company shall have the right, at its option,
notwithstanding any other provision of this Indenture (i) to require such Person
to dispose of its Debt Securities or beneficial interest therein within 30 days
of receipt of notice of the Company's election or such earlier date as may be
requested or prescribed by such Gaming Authority or (ii) to redeem such Debt
Securities at a redemption price equal to 100% of the principal amount thereof,
plus accrued and unpaid interest to the earlier of the redemption date and the
date of the finding of unsuitability, which may be less than 30 days following
the notice of redemption if so requested or prescribed by the Gaming Authority,
or such lesser amount as may be required by applicable law or by order of any
Gaming Authority. The Company shall notify the Trustee in writing of any such
redemption as soon as practicable. The Company shall not be responsible for any
costs or expenses any such holder or beneficial owner may incur in connection
with its application for a license, qualification or a finding of suitability.
Notwithstanding any other provision of this Indenture, immediately upon the
imposition of a requirement to dispose of Debt Securities by a Gaming Authority,
such Person shall, to the extent required by applicable Gaming Law, have no
further right (i) to exercise, directly or indirectly, through any trustee,
nominee or any other person or entity, any right conferred by the Debt
Securities or (ii) to receive any interest, dividends or any other distributions
or payments with respect to the Debt Securities or any remuneration in any form
with respect to the Debt Securities from the Company or the Trustee, except the
redemption price.
ARTICLE 4
SATISFACTION AND DISCHARGE
Section 4.1 SATISFACTION AND DISCHARGE OF INDENTURE.
- -----------------------------------------------------
This Indenture shall, upon Company Request, cease to be of further effect with
respect to any series of Debt Securities specified in such Company Request
(except as to any surviving rights of registration of transfer or exchange of
such Debt Securities herein expressly provided for and rights to receive
payments of principal (and premium, if any) and
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interest on such Debt Securities) and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when:
(a) either
(1) all Debt Securities of such series theretofore authenticated and
delivered (other than (i) Debt Securities which have been destroyed,
lost or stolen and which have been replaced or paid as provided in
Section 3.6, and (ii) Debt Securities of such series for whose
payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company
or discharged from such trust, as provided in Section 12.4) have been
delivered to the Trustee for cancellation; or
(2) all Debt Securities of such series not theretofore delivered to the
Trustee for cancellation,
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice by
the Trustee in the name, and at the expense, of the Company, or
(iv) the Company either complies with any other condition or terms
specified pursuant to Section 3.1, or if not so specified in the case
of (i), (ii) or (iii) of this subclause (a), has irrevocably
deposited or caused to be deposited with the Trustee as trust funds
in trust for such purpose an amount sufficient to pay and discharge
the entire indebtedness on such Debt Securities for principal (and
premium, if any) and interest to the date of such deposit (in the
case of Debt Securities which have become due and payable) or to the
Stated Maturity or Redemption Date, as the case may be; provided,
however, in the event a petition for relief under the Federal
bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or state bankruptcy, insolvency or other similar
law, is filed with respect to the Company within 91 days after the
deposit and the Trustee is required to return the deposited money to
the Company, the obligations of the Company under this Indenture with
respect to such Debt Securities shall not be deemed terminated or
discharged;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
(c) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture with respect to
such series have been complied with; and
(d) the Company has delivered to the Trustee an Opinion of Counsel or a ruling
by the Internal Revenue Service to the effect that holders of the Debt
Securities of the series will not recognize income, gain or loss
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for Federal income tax purposes as a result of such deposit and discharge.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
the Trustee to any Authenticating Agent under Section 6.14, the obligations of
the Company under Section 12.1, and, if money shall have been deposited with the
Trustee pursuant to subclause (2) of clause (a) of this Section, the obligations
of the Trustee under Section
Section 4.2 APPLICATION OF TRUST MONEY.
- ----------------------------------------
Subject to the provisions of the last paragraph of Section 12.4, all money
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
applied by it, in accordance with the provisions of the Debt Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.
ARTICLE 5
REMEDIES
Section 5.1 EVENTS OF DEFAULT.
- -------------------------------
"Event of Default" wherever used herein with respect to Debt Securities of any
series means any one of the following events (whatever the reason for such Event
of Default and whether it shall be voluntary or involuntary or be effected by
operation of law, pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any interest upon any Debt Security of such
series when it becomes due and payable, and continuance of such default for a
period of 30 days; or
(b) default in the payment of the principal of (and premium, if any, on) any
Debt Security of such series at its Maturity; or
(c) default in the deposit of any sinking fund payment, when and as due by the
terms of a Debt Security of such series; or
(d) default in the performance, or breach, of any covenant or warranty of any
Obligor in this Indenture (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section specifically dealt with
or which expressly has been included in this Indenture solely for the benefit of
Debt Securities of a series other than such series), and continuance of such
default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the holders of at least 25% in principal amount of the
Outstanding Debt Securities of such series, a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" hereunder; or
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(e) the entry of a decree or order for relief in respect of the Company by a
court having jurisdiction in the premises in an involuntary case under the
Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law, or a
decree or order adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable Federal or
State law, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or other similar official) of the Company or of any substantial
part of its property, or ordering the winding up or liquidation of its affairs,
and the continuance of any such decree or order unstayed and in effect for a
period of 90 consecutive days; or
(f) the commencement by the Company of a voluntary case under the Federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
Federal or State bankruptcy, insolvency or other similar law, or the consent by
it to the entry of an order for relief in an involuntary case under any such law
or to the appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or other similar official) of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit of
its creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due, or the taking of corporate action by the
Company in furtherance of any such action; or
(g) any other Event of Default or variations in the foregoing Events of
Default provided with respect to Debt Securities of that series pursuant to
Section 3.1.
Section 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
- ----------------------------------------------------------------
If an Event of Default with respect to Debt Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the holders of not less than 25% in principal amount of the Outstanding Debt
Securities of such series may declare the principal amount (or, if any Debt
Securities of such series are Discount Securities, such portion of the principal
amount of such Discount Securities as may be specified in the terms of such
Discount Securities) of all the Debt Securities of such series to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by holders), and upon any such declaration such principal amount (or
specified amount) plus accrued and unpaid interest (and premium, if payable)
shall become immediately due and payable. Upon payment of such amount all
obligations of the Company in respect of the payment of principal of the Debt
Securities of such series shall terminate.
At any time after such a declaration of acceleration with respect to Debt
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the holders of at least a majority in principal amount of the
Outstanding Debt Securities of such series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum sufficient to
pay
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(1) all overdue installments of interest on all Debt Securities of such
series,
(2) the principal of (and premium, if any, on) any Debt Securities of
such series which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate or rates prescribed
therefor in such Debt Securities,
(3) to the extent that payment of such interest is lawful, interest upon
overdue installments of interest on each Debt Security of such series at
the Overdue Rate, and
(4) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel;
(b) All Events of Default with respect to Debt Securities of such series,
other than the nonpayment of the principal of Debt Securities of such series
which has become due solely by such declaration of acceleration, have been cured
or waived as provided in Section 5.13.
No such rescission and waiver shall affect any subsequent default or impair any
right consequent thereon.
Section 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.
- -----------------------------------------------------------------------------
The Company covenants that, if:
(a) default is made in the payment of any installment of interest on any Debt
Security when such interest or payment becomes due and payable and such default
continues for a period of 30 days,
(b) default is made in the payment of principal of (or premium, if any, on)
any Debt Security at the Maturity thereof, or
(c) default is made in the making or satisfaction of any sinking fund payment
or analogous obligation when the same becomes due pursuant to the terms of the
Debt Securities of any series, then the Company will, upon demand of the
Trustee, pay to it, for the benefit of the holders of such Debt Securities, the
amount then due and payable on such Debt Securities for the principal (and
premium, if any) and interest, if any, and, to the extent that payment of such
interest shall be legally enforceable, interest upon the overdue principal (and
premium, if any) and upon overdue installments of interest, at the Overdue Rate;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amount forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company, any Guarantor or any other obligor upon such Debt
Securities and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company, any Guarantor or any
other obligor upon such Debt Securities wherever situated.
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If an Event of Default with respect to Debt Securities of any series occurs
and is continuing, then the Trustee may, in its discretion, proceed to protect
and enforce its rights and the rights of the holders of Debt Securities of such
series by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
Section 5.4 TRUSTEE MAY FILE PROOFS OF CLAIM.
- ----------------------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceedings, or any voluntary or involuntary case under the Federal
bankruptcy laws, as now or hereafter constituted, relative to the Company, any
Guarantor or any other obligor upon the Debt Securities, of a particular series
or the property of the Company, any Guarantor or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of such Debt
Securities shall then be due and payable as therein expressed or by declaration
of acceleration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Company, any Guarantor or any obligor for the payment of
overdue principal or interest) shall be entitled and empowered, by intervention
in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of principal (or, if the
Debt Securities of such series are Discount Securities, such portion of the
principal amount as may be due and payable with respect to such series pursuant
to a declaration in accordance with Section 5.2) (and premium, if any) and
interest owing and unpaid in respect of the Debt Securities of such series and
to file such other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the holders of such Debt Securities allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, custodian, liquidator, sequestrator (or
other similar official) in any such proceeding is hereby authorized by each such
holder to make such payments to the Trustee, and in the event that the Trustee
shall consent to the making of such payments directly to such holders, to pay to
the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debt
Securities of such series or the rights of any holder thereof, or to authorize
the Trustee to vote in respect of the claim of any holder in any such
proceeding.
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Section 5.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF DEBT SECURITIES.
- ------------------------------------------------------------------------------
All rights of action and claims under this Indenture or the Debt Securities of
any series may be prosecuted and enforced by the Trustee without the possession
of any of such Debt Securities or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name, as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the holders of the Debt Securities in respect of
which such judgment has been recovered.
Section 5.6 APPLICATION OF MONEY COLLECTED.
- --------------------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (and premium,
if any) or interest, upon presentation of the Debt Securities of any series in
respect of which money has been collected and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 6.7.
SECOND: To the payment of the amounts then due and unpaid for principal of
(and premium, if any) and interest on the Debt Securities of such series, in
respect of which or for the benefit of which such money has been collected
ratably, without preference or priority of any kind, according to the amounts
due and payable on such Debt Securities for principal (and premium, if any) and
interest, respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 5.7 LIMITATION ON SUITS.
- ---------------------------------
No holder of any Debt Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(a) such holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to such series;
(b) the holders of not less than 25% in principal amount of the Outstanding
Debt Securities of such series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such holder or holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
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(d) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given to the
Trustee during such 60-day period by the holders of at least a majority in
principal amount of the Outstanding Debt Securities of such series;
it being understood and intended that no one or more of such holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other such
holders or of the holders of Outstanding Debt Securities of any other series, or
to obtain or to seek to obtain priority or preference over any other of such
holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all of such holders.
For the protection and enforcement of the provisions of this Section 5.7, each
and every holder of Debt Securities of any series and the Trustee for such
series shall be entitled to such relief as can be given at law or in equity.
Section 5.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
------------------------------------------------------------
AND INTEREST.
- ------------
Notwithstanding any other provision in this Indenture, the holder of any Debt
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of (and premium, if any) and (subject to Section 3.7
and 3.10) interest on such Debt Security on the respective Stated Maturity or
Maturities expressed in such Debt Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment and interest thereon, and such right shall not be impaired without the
consent of such holder.
Section 5.9 RESTORATION OF RIGHTS AND REMEDIES.
- ------------------------------------------------
If the Trustee or any holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such holder, then and in every such case the Company, the Trustee and the
holders shall, subject to any determination in such proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Trustee and the holders shall continue as though
no such proceeding had been instituted.
Section 5.10 RIGHTS AND REMEDIES CUMULATIVE.
- --------------------------------------------
Except as otherwise expressly provided elsewhere in this Indenture, no right
or remedy herein conferred upon or reserved to the Trustee or to the holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
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Section 5.11 DELAY OR OMISSION NOT WAIVER.
- ------------------------------------------
No delay or omission of the Trustee or of any holder to exercise any right or
remedy accruing upon any Event of Default shall impair any such right or remedy
or constitute a waiver of any such Event of Default or any acquiescence therein.
Every right and remedy given by this Indenture or by law to the Trustee or to
the holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the holders, as the case may be.
Section 5.12 CONTROL BY HOLDERS.
- --------------------------------
The holders of at least a majority in principal amount of the Outstanding Debt
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee with respect to the Debt
Securities of such series, provided that:
(a) such direction shall not be in conflict with any rule of law or with this
Indenture;
(b) subject to the provisions of Section 6.1, the Trustee shall have the right
to decline to follow any such direction if the Trustee in good faith shall, by a
Responsible Officer or Responsible Officers of the Trustee, determine that the
proceeding so directed would be unjustly prejudicial to the holders of Debt
Securities of such series not joining in any such direction; and
(c) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
Section 5.13 WAIVER OF PAST DEFAULTS.
- -------------------------------------
The holders of not less than a majority in aggregate principal amount of the
Outstanding Debt Securities of any series, by notice to the Trustee, may, on
behalf of the holders of all Debt Securities of such series, waive any past
default hereunder with respect to such series and its consequences, except a
default:
(a) in the payment of the principal of (or premium, if any) or interest on any
Debt Security of such series, or in the payment of any sinking fund installment
or analogous obligation with respect to the Debt Securities of such series, or
(b) in respect of a covenant or provision hereof which, pursuant to Article
11, cannot be modified or amended without the consent of the holder of each
Outstanding Debt Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of the Debt Securities of such series under this Indenture, but no such waiver
shall extend to any subsequent or other default or impair any right consequent
thereon.
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Section 5.14 UNDERTAKING FOR COSTS.
- -----------------------------------
All parties to this Indenture agree, and each holder of any Debt Security by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit other than the Trustee of an undertaking to pay the costs of such suit, and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by such party
litigant, but the provisions of this Section shall not apply to any suit
instituted by the Trustee, to any suit instituted by any holder or group of
holders holding in the aggregate more than 10% in principal amount of the
Outstanding Debt Securities of any series, or to any suit instituted by any
holder of a Debt Security for the enforcement of the payment of the principal of
(or premium, if any) or interest on such Debt Security on or after the
respective Stated Maturity or Maturities expressed in such Debt Security (or, in
the case of redemption, on or after the Redemption Date).
Section 5.15 WAIVER OF STAY OR EXTENSION LAWS.
- ----------------------------------------------
Each Obligor covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay or extension law wherever enacted, now or
at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and each Obligor (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE 6
THE TRUSTEE
Section 6.1 CERTAIN DUTIES AND RESPONSIBILITIES.
- -------------------------------------------------
(a) Except during the continuance of an Event of Default with respect to the
Debt Securities of any series,
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but in the case of
any such certificates or opinions which by any provisions hereof are
specifically required to be furnished to the Trustee, the Trustee shall be under
a duty to examine the same to
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determine whether or not they conform to the requirements of this Indenture.
(b) In case an Event of Default with respect to Debt Securities of any series
has occurred and is continuing, the Trustee shall, with respect to the Debt
Securities of such series, exercise such of the rights and powers vested in it
by this Indenture, and use the same degree of care and skill in their exercise,
as a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this subsection shall not be construed to limit the effect of
subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it with respect to Debt Securities of
any series in good faith in accordance with the direction of the holders
of at least a majority in principal amount of the Outstanding Debt
Securities of such series relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture;
(4) the Trustee shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it; and
(5) the Trustee shall comply with any order or directive of a Gaming
Authority that the Trustee submit an application for any license, finding of
suitability or other approval pursuant to any Gaming Law and will cooperate
fully and completely in any proceeding related to such application.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 6.2 NOTICE OF DEFAULTS.
- --------------------------------
Within 90 days after the occurrence of any default hereunder with respect to
Debt Securities of any series, the Trustee shall give notice to all holders of
Debt Securities of such series of such default hereunder known to the Trustee,
unless such default shall have been cured or waived; provided, however, that,
except in the case of a default in the payment of the principal of (or premium,
if any) or interest on any Debt Security of such series or in the payment of any
sinking fund installment with respect to Debt Securities of such series, the
Trustee
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shall be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determine that the withholding
of such notice is in the interest of the holders of Debt Securities of such
series; and provided, further, that in the case of any default of the character
specified in Section 5.1(d) with respect to Debt Securities of such series no
such notice to holders shall be given until at least 30 days after the
occurrence thereof. For the purpose of this Section, the term "default" means
any event which is, or after notice or lapse of time or both would become, an
Event of Default with respect to Debt Securities of such series.
Notice given pursuant to this Section 6.2 shall be transmitted by mail:
(a) to all registered holders, as the names and addresses of the registered
holders appear in the Security Register; and
(b) to each holder of a Debt Security of any series whose name and address
appear in the information preserved at the time by the Trustee in accordance
with Section 7.2(a) of this Indenture.
Section 6.3 CERTAIN RIGHTS OF TRUSTEE.
- ---------------------------------------
Except as otherwise provided in Section 6.1:
(a) the Trustee may rely, and shall be protected in acting or refraining from
acting, upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors shall be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely upon
an Officers' Certificate;
(d) the Trustee may consult with counsel and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
holders of Debt Securities of any series pursuant to this Indenture, unless such
holders shall have offered to the Trustee security or indemnity reasonably
satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order,
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bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due
care by it hereunder.
Section 6.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF DEBT SECURITIES.
- -------------------------------------------------------------------------
The recitals contained herein and in the Debt Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debt Securities of any series. The Trustee shall not be
accountable for the use or application by the Company of any Debt Securities or
the proceeds thereof.
Section 6.5 MAY HOLD DEBT SECURITIES.
- --------------------------------------
The Trustee, any Paying Agent, the Security Registrar or any other agent of
the Company, in its individual or any other capacity, may become the owner or
pledgee of Debt Securities and, subject to Sections 6.8 and 6.13, may otherwise
deal with the Company with the same rights it would have if it were not Trustee,
Paying Agent, Security Registrar or such other agent.
Section 6.6 MONEY HELD IN TRUST.
- ---------------------------------
Money held by the Trustee or any Paying Agent in trust hereunder need not be
segregated from other funds except to the extent required by law. Neither the
Trustee nor any Paying Agent shall be under any liability for interest on any
money received by it hereunder except as otherwise agreed with the Company.
Section 6.7 COMPENSATION AND REIMBURSEMENT.
- --------------------------------------------
The Company agrees:
(a) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(b) except as otherwise expressly provided herein, to reimburse the Trustee
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the reasonable expenses and
disbursements of its agents and counsel), except
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any such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(c) to indemnify the Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
trust or performance of its duties hereunder, including the costs and expenses
of defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
As security for the performance of the obligations of the Company under this
Section, the Trustee shall have a claim prior to the Debt Securities, upon all
property and funds held or collected by the Trustee as such, except funds held
in trust for the payment of amounts due on the Debt Securities.
The obligations of the Company under this Section 6.7 to compensate and
indemnify the Trustee for reasonable expenses, disbursements and advances shall
constitute additional indebtedness under this Indenture and shall survive the
satisfaction and discharge of this Indenture.
SECTION 6.8. DISQUALIFICATION; CONFLICTING INTERESTS.
- -----------------------------------------------------
If the Trustee has or shall acquire a conflicting interest within the
meaning of Section 310 of the Trust Indenture Act, the Trustee shall either
eliminate such conflicting interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the Trust Indenture Act and this
Indenture. To the extent permitted by the Trust Indenture Act, the Trustee shall
not be deemed to have conflicting interest with respect to the Debt Securities
of any series by virtue
of being Trustee with respect to the Debt Securities of any particular series of
Debt Securities other than that series.
Section 6.9 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
- -----------------------------------------------------
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $100,000,000, subject to supervision or examination by Federal,
State or District of Columbia authority. If such corporation publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. Neither the Company nor any person directly or
indirectly controlling, controlled by, or under common control with the Company
shall serve as Trustee upon any Debt Securities.
Section 6.10 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
- ---------------------------------------------------------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
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(b) The Trustee may resign at any time with respect to the Debt Securities of
one or more series by giving written notice thereof to the Company. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Debt Securities of such
series.
(c) The Trustee may be removed at any time with respect to the Debt Securities
of any series and a successor Trustee appointed by Act of the holders of at
least a majority in principal amount of the Outstanding Debt Securities of such
series, delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 with respect to the
Debt Securities of any series after written request therefor by the Company or
by any holder who has been a bona fide holder of a Debt Security of such series
for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.9 with respect
to the Debt Securities of any series and shall fail to resign after written
request therefor by the Company or by any such holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) the Company, by a Board Resolution, may remove the
Trustee with respect to all Debt Securities, or (ii) subject to Section 5.14,
any holder who has been a bona fide holder of a Debt Security of any series for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee for the Debt Securities of such series.
(e) If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause, with respect to
the Debt Securities of one or more series, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the Debt
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Debt Securities of one or more or
all of such series and that at any time there shall be only one Trustee with
respect to the Debt Securities of any particular series) and shall comply with
the applicable requirements of Section 6.11. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Debt Securities of any series shall be
appointed by Act of the holders of at least a majority in principal amount of
the Outstanding Debt Securities of such series delivered to the Company and the
retiring Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor Trustee with respect to the
Debt Securities of such series and, to that extent, supersede the successor
Trustee appointed by the Company. If no successor Trustee with respect to the
Debt Securities of any series shall have been so appointed by the Company or the
holders of such series and accepted appointment in the
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manner hereinafter provided, any holder who has been a bona fide holder of a
Debt Security of such series for at least six months may, subject to Section
5.14, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee with
respect to the Debt Securities of such series.
(f) The Company shall give notice of each resignation and each removal of the
Trustee with respect to the Debt Securities of any series and each appointment
of a successor Trustee with respect to the Debt Securities of any series in the
manner and to the extent provided in Section 18.2 to the holders of Debt
Securities of such series. Each notice shall include the name of the successor
Trustee with respect to the Debt Securities of such series and the address of
its Corporate Trust Office.
Section 6.11 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
- ----------------------------------------------------
(a) In the case of an appointment hereunder of a successor Trustee with
respect to all Debt Securities, each such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee, but, on request of
the Company or the successor Trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee, and shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder, subject nevertheless to its
claim, if any, provided for in Section 6.7.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Debt Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Debt
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Debt Securities of that or those series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Debt Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Debt Securities of that or those
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in any such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any other trust or trusts hereunder administered by any other such Trustee; and,
upon the execution and delivery of any such supplemental indenture, the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Debt
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Securities of that or those series to which the appointment of such successor
Trustee relates, but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Debt Securities of that or those series to which the appointment
of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts referred to in
paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 6.12 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
- -------------------------------------------------------------------------
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Debt Securities shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Debt Securities so authenticated
with the same effect as if such successor Trustee had itself authenticated such
Debt Securities. In case any Debt Securities shall not have been authenticated
by such predecessor Trustee, any such successor Trustee may authenticate and
deliver such Debt Securities, in either its own name or that of its predecessor
Trustee, with the full force and effect which this Indenture provides for the
certificate of authentication of the Trustee.
Section 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
- --------------------------------------------------------------
If and when the Trustee shall be or become a creditor of the Company (or any
Guarantor or other obligor upon the Debt Securities), the Trustee shall be
subject to the provisions of Section 311 of the Trust Indenture Act regarding
the collection of such claims against the Company (or any such Guarantor or
other obligor). A Trustee that has resigned or been removed shall be subject to
and comply with said Section 311 to the extent required thereby.
Section 6.14 APPOINTMENT OF AUTHENTICATING AGENT.
- -------------------------------------------------
As long as any Debt Securities of a series remain Outstanding, upon a Company
Request, there shall be an authenticating agent (the "Authenticating Agent")
appointed, for such period as the Company shall elect, by the Trustee for such
series of Debt Securities to act as its agent on its behalf and subject to its
direction in connection with the authentication and delivery of each series of
Debt Securities for which
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it is serving as Trustee. Debt Securities of each such series authenticated by
such Authenticating Agent shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by such
Trustee. Wherever reference is made in this Indenture to the authentication and
delivery of Debt Securities of any series by the Trustee for such series or to
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee for such series by
an Authenticating Agent for such series and a certificate of authentication
executed on behalf of such Trustee by such Authenticating Agent, except that
only the Trustee may authenticate Debt Securities upon original issuance and
pursuant to Section 3.6 hereof. Such Authenticating Agent shall at all times be
a corporation organized and doing business under the laws of the United States
of America or of any State, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $100,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
converted, or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent with
respect to all series of Debt Securities for which it served as Authenticating
Agent without the execution or filing of any paper or any further act on the
part of the Trustee for such series or such Authenticating Agent. Any
Authenticating Agent may at any time, and if it shall cease to be eligible
shall, resign by giving written notice of resignation to the applicable Trustee
and to the Company.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any time any Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 6.14 with respect to one or more
or all series of Debt Securities, the Trustee for such series shall, upon
Company Request, appoint a successor Authenticating Agent, and the Company shall
provide notice of such appointment to all holders of Debt Securities of such
series in the manner and to the extent provided in Section 18.2. Any successor
Authenticating Agent, upon acceptance of its appointment hereunder, shall become
vested with all rights, powers, duties and responsibilities of its predecessor
hereunder, with like effect as if originally named as Authenticating Agent
herein. The Trustee for the Debt Securities of such series agrees to pay to the
Authenticating Agent for such series from time to time reasonable compensation
for its services, and the Trustee shall be entitled to be reimbursed for such
payment, subject to the provisions of Section 6.7. The Authenticating Agent for
the Debt Securities of any series shall have no responsibility or liability for
any action taken by it as such at the direction of the Trustee for such series,
except arising out of its negligence or willful misconduct.
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If an appointment with respect to one or more series is made pursuant to this
Section, the Debt Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the series of Debt Securities issued under the within
mentioned Indenture.
[NAME OF TRUSTEE] As Trustee
By: ____________________
As Authenticating Agent
By: ____________________
Authorized Signatory
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 7.1 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS.
- -----------------------------------------------------------------------
The Company will furnish or cause to be furnished to the Trustee with respect
to Debt Securities of each series for which it acts as Trustee:
(a) semi-annually on a date not more than 15 days after each Regular Record
Date with respect to an Interest Payment Date, if any, for the Debt
Securities of such series (or on semi-annual dates in each year to be
determined pursuant to Section 3.1 if the Debt Securities of such series
do not bear interest), a list, in such form as the Trustee may reasonably
require, of the names and addresses of the registered holders as of the
date 15 days next preceding each such Regular Record Date (or such semi-
annual dates, as the case may be); and
(b) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished;
Provided, however, that if and so long as the Trustee shall be the Security
Registrar for such series, no such list need be furnished.
Section 7.2 PRESERVATION OF INFORMATION; COMMUNICATION TO HOLDERS.
- -------------------------------------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of holders contained
in the most recent list furnished to the Trustee as provided in Section 7.1
received by it in the capacity of Paying Agent (if so acting) hereunder, and
filed with it within the two preceding years pursuant to Section 7.3(c)(2).
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The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished, destroy any information
received by it as Paying Agent (if so acting) hereunder upon delivering to
itself as Trustee, not earlier than 45 days after an Interest Payment Date, a
list containing the names and addresses of the holders obtained from such
information since the delivery of the next previous list, if any, destroy any
list delivered to itself as Trustee which was compiled from information received
by it as Paying Agent (if so acting) hereunder upon the receipt of a new list so
delivered, and destroy, not earlier than two years after filing, any information
filed with it pursuant to Section 7.3(c)(2).
(b) If three or more holders (hereinafter referred to as "applicants") apply
in writing to the Trustee, and furnish to the Trustee reasonable proof that each
such applicant has owned a Debt Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other holders of Debt Securities of a
particular series (in which case the applicants must hold Debt Securities of
such series) or with all holders of Debt Securities with respect to their rights
under this Indenture or under the Debt Securities and is accompanied by a copy
of the form of proxy or other communication which such applicants propose to
transmit, then the Trustee shall, within five Business Days after the receipt of
such application, at its election, either
(i) afford such applicants access to the information preserved at the time
by the Trustee in accordance with Section 7.2(a), or
(ii) inform such applicants as to the approximate number of holders of Debt
Securities of such series or of all Debt Securities, as the case may be, whose
names and addresses appear in the information preserved at the time by the
Trustee in accordance with Section 7.2(a), and as to the approximate cost of
mailing to such holders the form of proxy or other communication, specified in
such application.
If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon written request of such applicants, mail to
the holders of Debt Securities of such series or all holders, as the case may
be, whose names and addresses appear in the information preserved at the time by
the Trustee in accordance with Section 7.2(a), a copy of the form of proxy or
other communication which is specified in such request, with reasonable
promptness after a tender to the Trustee of the material to be mailed and of
payment, or provision for the payment, of the reasonable expenses of mailing,
unless within five Business Days after such tender, the Trustee shall mail to
such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion of
the Trustee, such mailing would be contrary to the best interests of the holders
of Debt Securities of such series or all holders, as the case may be, or would
be in violation of applicable law. Such written statement shall specify the
basis of such opinion. If the Commission, after opportunity for a hearing upon
the objections specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if after the entry of an order
sustaining one or more of such objections, the Commission shall find, after
notice and opportunity for hearing, that all the objections so sustained have
been met and shall enter an order so declaring, the Trustee shall mail copies of
such material to all such holders with reasonable promptness after the entry of
such order and the renewal of such tender; otherwise the Trustee shall be
relieved of any obligation or duty to such applicants respecting their
application.
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(c) Every holder of Debt Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee shall
be held accountable by reason of the disclosure of any such information as to
the names and addresses of the holders in accordance with Section 7.2(b),
regardless of the source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing of any material
pursuant to a request made under Section 7.2(b).
Section 7.3 REPORTS BY TRUSTEE.
- --------------------------------
(a) Within 60 days after [DATE] of each year, commencing with the first [DATE]
after the first issuance of Debt Securities pursuant to this Indenture, the
Trustee shall, to the extent required by the Trust Indenture Act, transmit to
all holders of Debt Securities of any series with respect to which it acts as
Trustee, in the manner hereinafter provided in this Section 7.3, a brief report
dated such date with respect to any of the following events which may have
occurred within the previous 12 months (but if no such event has occurred within
such period, no report need be transmitted):
(1) any change to its eligibility under Section 6.9 and its
qualifications under Section 6.8;
(2) the creation of or any material change to a relationship specified in
paragraph (1) through (10) of Section 310(b) of the Trust Indenture Act;
(3) the character and amount of any advances (and if the Trustee elects so
to state, the circumstances surrounding the making thereof) made by the Trustee
(as such) which remain unpaid on the date of such report, and for the
reimbursement of which it claims or may claim a lien or charge, prior to that of
the Debt Securities of such series, on any property or funds held or collected
by it as Trustee, except that the Trustee shall not be required (but may elect)
to report such advances if such advances so remaining unpaid aggregate not more
than 1/2 of 1% of the principal amount of the Outstanding Debt Securities of
such series on the date of such report;
(4) any change to the amount, interest rate and maturity date of all other
indebtedness owing by the Company (or any other obligor on the Debt Securities
of such series) to the Trustee in its individual capacity, on the date of such
report, with a brief description of any property held as collateral security
therefor, except an indebtedness based upon a creditor relationship arising in
any manner described in Section 311(b) of the Trust Indenture Act;
(5) any change to the property and funds, if any, physically in the
possession of the Trustee as such on the date of such report;
(6) any additional issue of Debt Securities which the Trustee has not
previously reported; and
(7) any action taken by the Trustee in the performance of its duties
hereunder which it has not previously reported and which, in its opinion,
materially affects the Debt Securities of such series, except action in respect
of a default, notice of which has been or is to be withheld by the Trustee in
accordance with Section 6.2.
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(b) The Trustee shall transmit by mail to all holders of Debt Securities of
any series (whose names and addresses appear in the information preserved at the
time by the Trustee in accordance with Section 7.2 (a)) for which it acts as the
Trustee, as hereinafter provided, a brief report with respect to the character
and amount of any advances (and if the Trustee elects so to state, the
circumstances surrounding the making thereof) made by the Trustee (as such)
since the date of the last report transmitted pursuant to subsection (a) of this
Section (or if no such report has yet been so transmitted, since the date of
execution of this instrument) for the reimbursement of which it claims or may
claim a lien or charge, prior to that of the Debt Securities of such series, on
property or funds held or collected by it as Trustee, and which it has not
previously reported pursuant to this subsection, except that the Trustee for
each series shall not be required (but may elect) to report such advances if
such advances remaining unpaid at any time aggregate 10% or less of the
principal amount of the Debt Securities of such series Outstanding at such time,
such report to be transmitted within 90 days after such time.
(c) Gaming License Requirements. To the extent required by Gaming Laws the
Trustee will provide any applicable Gaming Authority with:
(1) copies of all notices, reports and other written communications which
the Trustee gives to holders of Debt Securities;
(2) a list of holders of Debt Securities promptly after the original
issuance of the Debt Securities, eight months and two months prior to the
expiration date of each then-current Gaming License held by the Company or its
subsidiaries, and upon demand;
(3) notice of any Event of Default under this Indenture or of any Default,
any acceleration of the indebtedness evidenced or secured hereby, the
institution of any legal actions or proceedings before any court or governmental
authority in respect of this Indenture and any rescission, annulment or waiver
in respect of an Event of Default;
(4) notice of the removal or resignation of the Trustee within five Business
Days thereof;
(5) notice of any transfer or assignment of rights under this
Indenture (but no transfers or assignments of the Debt Securities) within five
Business Days thereof; and
(6) a copy of any amendment to the Debt Securities or this Indenture within
five Business Days of the effectiveness thereof.
The notice specified in clause (3) above shall be in writing and, except as set
forth below, shall be given within five Business Days after the trustee has
transmitted the notice required by Section 6.2. In the case of any notice in
respect of any Event of Default, such notice shall be accompanied by a copy of
any notice from the holders of the Debt Securities, or a representative thereof
or the Trustee, to the Company and, if accompanied by any such notice to the
Company, shall be given simultaneously with the giving of any such notice to the
Company. In the case of any legal actions or proceedings, such notice shall be
accompanied by a copy of the complaint or other initial pleading or document.
The Trustee shall in accordance with the limitations set forth herein
cooperate with any applicable Gaming Authority in order to provide such Gaming
Authority with information and documentation relevant to
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compliance with clause (3) above and as otherwise required by any applicable
Gaming Law.
The Company will advise the Trustee of the expiration date of any then-current
Gaming License held by the Company or its subsidiaries at least nine months
prior to the expiration thereof and the Trustee until so advised may assume that
such Gaming License has not expired.
(d) Reports pursuant to this Section 7.3 shall be transmitted by mail:
(1) to all holders of Debt Securities, as the names and addresses of such
holders of Debt Securities appear in the Security Register; and
(2) except in the cases of reports pursuant to subsection (b) of this
Section 7.3, to each holder of a Debt Security of any series whose name and
address appear in the information preserved at the time by the Trustee in
accordance with Section 7.2(a).
(e) A copy of each such report shall, at the time of such transmission to
holders, be filed by the Trustee with each stock exchange upon which any Debt
Securities of such series are listed, with the Commission and also with the
Company. The Company will notify the Trustee when any series of Debt Securities
are listed on any stock exchange.
Section 7.4 REPORTS BY COMPANY.
- --------------------------------
Unless otherwise specified with respect to a particular series of Debt
Securities pursuant to Section 3.1, the Company will file with the Trustee,
within 15 days after the Company is required to file the same with the
Commission, copies of the annual reports and of the information, documents and
other reports which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
as amended.
ARTICLE 8
CONCERNING THE HOLDERS
Section 8.1 ACTS OF HOLDERS.
- -----------------------------
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be given or taken by holders of Debt
Securities may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such holders in person or by an agent or
proxy duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee, and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the holders
signing such instrument or instruments. Whenever in this Indenture it is
provided that the holders of a specified percentage in aggregate principal
amount of the Outstanding Debt Securities of any series may take any Act, the
fact that the holders of such specified percentage have joined therein may be
evidenced (a) by the instrument or instruments executed by holders
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in person or by agent or proxy appointed in writing, or (b) by the record of
holders voting in favor thereof at any meeting of such holders duly called and
held in accordance with the provisions of Article 9, or (c) by a combination of
such instrument or instruments and any such record of such a meeting of holders.
Section 8.2 PROOF OF OWNERSHIP; PROOF OF EXECUTION OF INSTRUMENTS BY HOLDER.
- -----------------------------------------------------------------------------
The ownership of Debt Securities of any series shall be proved by the Security
Register for such series or by a certificate of the Security Registrar for such
series.
Subject to the provisions of Sections 6.1, 6.3 and 9.5, proof of the execution
of a writing appointing an agent or proxy and of the execution of any instrument
by a holder or his agent or proxy shall be sufficient and conclusive in favor of
the Trustee and the Company if made in the following manner:
The fact and date of the execution by any such person of any instrument may be
proved by the certificate of any notary public or other officer authorized to
take acknowledgements of deeds, that the Person executing such instrument
acknowledged to him the execution thereof, or by an affidavit of a witness to
such execution sworn to before any such notary or other such officer. Where
such execution is by an officer of a corporation or association or a member of a
partnership on behalf of such corporation, association or partnership, as the
case may be, or by any other Person acting in a representative capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority.
The record of any holders' meeting shall be proved in the manner provided in
Section 9.6.
The Trustee may in any instance require further proof with respect to any of
the matters referred to in this Section so long as the request is a reasonable
one.
Section 8.3 PERSONS DEEMED OWNERS.
- -----------------------------------
The Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name any Debt Security is registered as the owner of such
Debt Security for the purpose of receiving payment of the principal of (and
premium, if any) and (subject to Section 3.7) interest, if any, on such Debt
Security and for all other purposes whatsoever, whether or not such Debt
Security be overdue, and neither the Company, the Trustee nor any agent of the
Company or the Trustee shall be affected by notice to the contrary. All
payments made to any holder, or upon his order, shall be valid, and, to the
extent of the sum or sums paid, effectual to satisfy and discharge the liability
for moneys payable upon such Debt Security.
Section 8.4 REVOCATION OF CONSENTS; FUTURE HOLDERS BOUND.
- ----------------------------------------------------------
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.1, of the taking of any Act by the holders of the
percentage in aggregate principal amount of the Outstanding Debt Securities
specified in this Indenture in connection with such Act, any holder of a Debt
Security the number, letter or other distinguishing
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symbol of which is shown by the evidence to be included in the Debt Securities
the holders of which have consented to such Act may, by filing written notice
with the Trustee at the Corporate Trust Office and upon proof of ownership as
provided in Section 8.2, revoke such Act so far as it concerns such Debt
Security. Except as aforesaid, any such Act taken by the holder of any Debt
Security shall be conclusive and binding upon such holder and, subject to the
provisions of Section 5.8, upon all future holders of such Debt Security and of
any Debt Securities issued on transfer or in lieu thereof or in exchange or
substitution therefor, irrespective of whether or not any notation in regard
thereto is made upon such Debt Security or such other Debt Securities.
ARTICLE 9
HOLDERS' MEETINGS
Section 9.1 PURPOSES OF MEETINGS.
- ----------------------------------
A meeting of holders of any or all series may be called at any time and from
time to time pursuant to the provisions of this Article 9 for any of the
following purposes:
(a) to give any notice to the Company or to the Trustee for such series, or to
give any directions to the Trustee for such series, or to consent to the waiving
of any default hereunder and its consequences, or to take any other action
authorized to be taken by holders pursuant to any of the provisions of Article
5;
(b) to remove the Trustee for such series and appoint a successor Trustee
pursuant to the provisions of Article 6;
(c) to consent to the execution of an indenture or indentures supplemental
hereto pursuant to the provisions of Section 11.2; or
(d) to take any other action authorized to be taken by or on behalf of the
holders of any specified aggregate principal amount of the Outstanding Debt
Securities of any one or more or all series, as the case may be, under any other
provision of this Indenture or under applicable law.
Section 9.2 CALL OF MEETINGS BY TRUSTEE.
- -----------------------------------------
The Trustee for any series may at any time call a meeting of holders of such
series to take any action specified in Section 9.1, to be held at such time or
times and at such place or places as the Trustee for such series shall
determine. Notice of every meeting of the holders of any series, setting forth
the time and the place of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given to holders of such series in the
manner and to the extent provided in Section 18.2. Such notice shall be given
not less than 10 days nor more than 90 days prior to the date fixed for the
meeting.
Section 9.3 CALL OF MEETINGS BY COMPANY OR HOLDERS.
- ----------------------------------------------------
In case at any time the Company, pursuant to a Board Resolution, or the
holders of at least 10% in aggregate principal amount of the Outstanding Debt
Securities of a series or of all series, as the case may
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be, shall have requested the Trustee for such series to call a meeting of
holders of any or all such series by written request setting forth in reasonable
detail the action proposed to be taken at the meeting, and the Trustee shall not
have given the notice of such meeting within 10 days after the receipt of such
request, then the Company or such holders may determine the time or times and
the place or places for such meetings and may call such meetings to take any
action authorized in Section 9.1, by giving notice thereof as provided in
Section 9.2.
Section 9.4 QUALIFICATIONS FOR VOTING.
- ---------------------------------------
To be entitled to vote at any meeting of holders, a Person shall be (a) a
holder of a Debt Security of the series with respect to which such meeting is
being held or (b) a Person appointed by an instrument in writing as agent or
proxy by such holder. The only Persons who shall be entitled to be present or
to speak at any meeting of holders shall be the Persons entitled to vote at such
meeting and their counsel, any representatives of the Trustee for the series
with respect to which such meeting is being held and its counsel and any
representatives of the Company and its counsel.
Section 9.5 REGULATIONS.
- -------------------------
Notwithstanding any other provisions of this Indenture, the Trustee for any
series may make such reasonable regulations as it may deem advisable for any
meeting of holders of such series, in regard to proof of the holding of Debt
Securities of such series and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as it shall deem
appropriate.
The Trustee shall, by an instrument in writing, appoint a temporary chairman
of the meeting, unless the meeting shall have been called by the Company or by
holders of such series as provided in Section 9.3, in which case the Company or
the holders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by at least a majority vote of the meeting.
Subject to the provisos in the definition of "Outstanding," at any meeting
each holder of a Debt Security of the series with respect to which such meeting
is being held or proxy therefor shall be entitled to one vote for each $1,000
principal amount (or such other amount as shall be specified as contemplated by
Section 3.1) of Debt Securities of such series held or represented by such
holder; provided, however, that no vote shall be cast or counted at any meeting
in respect of any Debt Security challenged as not Outstanding and ruled by the
chairman of the meeting to be not Outstanding. The chairman of the meeting
shall have no right to vote other than by virtue of Outstanding Debt Securities
of such series held by him or her or instruments in writing duly designating him
or her as the person to vote on behalf of holders of Debt Securities of such
series. Any meeting of holders with respect to which a meeting was duly called
pursuant to the provisions of Section 9.2 or 9.3 may be adjourned from time to
time by at least a majority of such holders present and the meeting may be held
as so adjourned without further notice.
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Section 9.6 VOTING.
- --------------------
The vote upon any resolution submitted to any meeting of holders of a series
of Debt Securities with respect to which such meeting is being held shall be by
written ballots on which shall be subscribed the signatures of such holders or
of their representatives by proxy and the serial number or numbers of the Debt
Securities held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of holders shall be taken and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more persons having knowledge of the facts setting
forth a copy of the notice of the meeting and showing that said notice was
transmitted as provided in Section 9.2. The record shall show the serial
numbers of the Debt Securities voting in favor of or against any resolution.
The record shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one of the duplicates shall be
delivered to the Company and the other to the Trustee to be preserved by the
Trustee.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
Section 9.7 NO DELAY OF RIGHTS BY MEETING.
- -------------------------------------------
Nothing contained in this Article 9 shall be deemed or construed to authorize
or permit, by reason of any call of a meeting of holders or any rights expressly
or impliedly conferred hereunder to make such call, any hindrance or delay in
the exercise of any right or rights conferred upon or reserved to the Trustee or
to any holder under any of the provisions of this Indenture or of the Debt
Securities of any series.
ARTICLE 10
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 10.1 COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
- ------------------------------------------------------------------
The Company shall not consolidate with, merge with or into, or sell, assign,
convey, transfer or lease its properties and assets substantially in their
entirety (computed on a consolidated basis) to any Person, unless:
(a) either (A) the Company is the surviving entity or (B) the successor or
transferee (the "successor corporation") is a corporation organized and existing
under the laws of the United States, any State thereof or the District of
Columbia and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, all of the obligations of the Company
under the Debt Securities and this Indenture;
(b) immediately after giving effect to such transaction, no Event of Default
or Default shall exist; and
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(c) the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel each stating that such consolidation, merger, conveyance,
transfer or lease and such supplemental indenture comply with this provision and
that all conditions precedent herein provided for relating to such transaction
have been complied with.
Section 10.2 SUCCESSOR CORPORATION SUBSTITUTED.
- -----------------------------------------------
Upon any consolidation with or merger into any other corporation, or any
conveyance, transfer or lease of the properties and assets of the Company
substantially in their entirety in accordance with Section 10.1, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named as the Company herein.
ARTICLE 11
SUPPLEMENTAL INDENTURES
Section 11.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
- ----------------------------------------------------------------
Without the consent of any holders, the relevant Obligors, when authorized
by a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form reasonably
satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another corporation to the rights of any
Obligor and the assumption by such successor of the covenants and obligations of
any Obligor contained herein and in the Debt Securities; or
(b) to add to the covenants, agreements or obligations of any Obligor for
the benefit of the holders of all or any series of Debt Securities (and if such
covenants are to be for the benefit of less than all series, stating that such
covenants are expressly being included solely for the benefit of such series),
or to surrender any right or power herein conferred upon the Company; or
(c) to add any additional Events of Default (and if such Events of Default
are to be applicable to less than all series, stating that such Events of
Default are expressly being included solely to be applicable to such series);or
(d) to add to, change or eliminate any of the provisions of this Indenture,
provided that any such addition, change or elimination shall become effective
only when there is no Outstanding Debt Security of any series created prior to
the execution of such supplemental indenture which is entitled to the benefit of
such provision and as to which such supplemental indenture would apply; or
(e) to secure the Debt Securities of any series or to provide that any of
the Company's obligations under any series of the Debt Securities or this
Indenture shall be guaranteed and the terms and
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conditions for the release or substitution of such security or guarantee; or
(f) to supplement any of the provisions of this Indenture to such extent as
shall be necessary to permit or facilitate the defeasance and discharge of any
series of Debt Securities pursuant to Article 4 or 14, provided that any such
action shall not adversely affect the interests of the holders of Debt
Securities of such series or any other series of Debt Securities in any material
respect; or
(g) to establish the form or terms of Debt Securities, of any series as
permitted by Sections 2.1 and 3.1; or
(h) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to one or more series of Debt Securities, and to
add to or change any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts hereunder by more
than one trustee; or
(i) to comply with the requirements of the Commission in connection with the
qualification of this Indenture under the Trust Indenture Act;
(j) to cure any ambiguity, to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein or to
make any other provisions with respect to matters or questions arising under
this Indenture which shall not be inconsistent with any provision of this
Indenture; provided such other provisions shall not adversely affect the
interests of the holders of Outstanding Debt Securities of any series created
prior to the execution of such supplemental indenture in any material respect.
The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of any applicable Gaming Authority.
Section 11.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS.
- -------------------------------------------------------------
With the written consent of the holders of not less than at least a majority
in principal amount of the Outstanding Debt Securities of each series affected
by such supplemental indenture, by Act of said holders delivered to the Company
and the Trustee, the relevant Obligors when authorized by a Board Resolution,
and the Trustee may enter into an indenture or indentures supplemental hereto
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the holders under this Indenture of such Debt Securities;
provided, however, that no such supplemental indenture shall, without the
consent of the holder of each Outstanding Debt Security of each such series
affected thereby,
(a) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, any Debt Security, or reduce the principal amount
thereof or the rate (or extend the time for payment) of interest thereon or any
premium payable upon redemption thereof, or reduce the amount of the principal
of a Discount Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2, or impair the
right to institute suit for the enforcement of any payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date),
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or alter any redemption provisions in a manner adverse to the holders of such
series of Debt Securities or adversely affect the right to convert any Debt
Security into shares of Common Stock or other securities or property of the
Company as may be provided pursuant to Section 3.1; or
(b) reduce the percentage in principal amount of the Outstanding Debt
Securities of any series, the consent of whose holders is required for any
supplemental indenture, or the consent of whose holders is required for any
waiver of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences provided for in this Indenture; or
(c) modify any of the provisions of this Section, Section 5.13, or Section
12.6, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of
the holder of each Outstanding Debt Security of each series affected thereby;
provided, however, that this clause shall not be deemed to require the consent
of any holder with respect to changes in the references to "the Trustee" and
concomitant changes in this Section, or the deletion of this proviso, in
accordance with the requirements of Sections 6.11 and 11.1(9).
It shall not be necessary for any Act of holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture with respect to one or more particular series of
Debt Securities, or which modifies the rights of the holders of Debt Securities
of such series with respect to such covenant or other provision, shall be deemed
not to affect the rights under this Indenture of the holders of Debt Securities
of any other series.
The terms of any document entered into pursuant to this Section shall be
subject to prior approval, if required, of any applicable Gaming Authority.
Section 11.3 EXECUTION OF SUPPLEMENTAL INDENTURES.
- --------------------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which adversely affects
the Trustee's own rights, duties or immunities under this Indenture or otherwise
in a material way.
Section 11.4 EFFECT OF SUPPLEMENTAL INDENTURES.
- -----------------------------------------------
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every holder
of Debt Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
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Section 11.5 CONFORMITY WITH TRUST INDENTURE ACT.
- -------------------------------------------------
Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act as then in effect.
Section 11.6 REFERENCE IN DEBT SECURITIES TO SUPPLEMENTAL INDENTURES.
- ---------------------------------------------------------------------
Debt Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall,
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Debt Securities of any series so modified as to conform, in
the opinion of the Trustee and the Board of Directors, to any such supplemental
indenture may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Debt Securities of such
series.
ARTICLE 12
COVENANTS
Section 12.1 PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
- --------------------------------------------------------
The Company covenants and agrees for the benefit of each series of Debt
Securities, that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Debt Securities in accordance with the terms of the
Debt Securities and this Indenture. If so provided in the terms of any series
of Debt Securities established as provided in Section 3.1, the interest, if any,
due in respect of any temporary Global Note or permanent Global Note, together
with any additional amounts payable in respect thereof, as provided in the terms
and conditions of such Debt Security, shall be payable only upon presentation of
such Debt Security to the Trustee for notation thereon of the payment of such
interest.
Section 12.2 OFFICER'S CERTIFICATE AS TO COMPLIANCE.
- ----------------------------------------------------
Unless otherwise specifically provided for with respect to any series of
Debt Securities under Section 3.1, the Company will deliver to the Trustee,
within 120 days after the end of each fiscal year, a certificate of the
principal executive officer, principal financial officer or principal accounting
officer of the Company stating whether or not, to the knowledge of the signer
thereof, the Obligors are in compliance with all covenants and conditions under
this Indenture, and, in the event of any noncompliance, specifying such
noncompliance and the nature and status thereof of which such signer may have
knowledge. For purposes of this Section, such compliance shall be determined
without regard to any period of grace or requirement of notice provided under
this Indenture.
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Section 12.3 MAINTENANCE OF OFFICE OR AGENCY.
- ---------------------------------------------
The Company will maintain in each Place of Payment for such series an office
or agency where Debt Securities of that series may be presented or surrendered
for payment, where Debt Securities of that series may be surrendered for
registration of transfer or exchange, where Debt Securities of that series that
are convertible may be surrendered for conversion, if applicable, and where
notices and demands to or upon the Company in respect of the Debt Securities of
that series and this Indenture may be served. If the Debt Securities of any
series are listed on The Stock Exchange of the United Kingdom and the Republic
of Ireland, the Luxembourg Stock Exchange or any other stock exchange located
outside the United States and such stock exchange shall so require, the Company
will maintain a Paying Agent for the Debt Securities of that series in London,
Luxembourg or any other required city located outside the United States, as the
case may be, so long as the Debt Securities of that series are listed on such
exchange, and subject to any laws or regulations applicable thereto, in a Place
of Payment for that series located outside the United States an office or agency
where any Debt Securities of that series may be surrendered for registration of
transfer, where Debt Securities of that series may be surrendered for exchange
or redemption and where notices and demands to or upon the Company in respect of
the Debt Securities of that series and this Indenture may be served. The Company
will give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee and
the Company hereby appoints the Trustee as its agent to receive all
presentations, surrenders, notices and demands.
The Company may also from time to time designate different or
additional offices or agencies to be maintained for such purposes (in or outside
of such Place of Payment), and may from time to time rescind any such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligations described in the preceding
paragraph. The Company will give prompt written notice to the Trustee of any
such additional designation or rescission of designation and any change in the
location of any such different or additional office or agency.
Section 12.4 MONEY FOR DEBT SECURITIES; PAYMENTS TO BE HELD IN TRUST.
- ---------------------------------------------------------------------
If the Company shall at any time act as its own Paying Agent with respect to
any series of Debt Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Debt Securities of
such series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided, and will promptly notify the Trustee of its
action or failure so to act.
Whenever the Company shall have one or more Paying Agents with respect to
any series of Debt Securities, it will, by or on each due date of the principal
(and premium, if any) or interest on any Debt Securities of such series, deposit
with any such Paying Agent a sum sufficient to pay the principal (and premium,
if any) or interest so becoming due, such
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sum to be held in trust for the benefit of the Persons entitled thereto, and
(unless any such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its action or failure so to act.
The Company will cause each Paying Agent with respect to any series of Debt
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest on Debt Securities of such series in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(b) give the Trustee notice of any default by the Company (or any other
obligor upon the Debt Securities of such series) in the making of any
payment of principal (and premium, if any) or interest on the Debt
Securities of such series; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all
sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of (and premium, if any)
or interest on any Debt Security of any series and remaining unclaimed for two
years after such principal (and premium, if any) or interest has become due and
payable shall be paid to the Company upon Company Request, or (if then held by
the Company) shall be discharged from such trust; and the holder of such Debt
Security shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be transmitted in the manner and to the extent
provided by Section 18.2, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such notification, any unclaimed balance of such money then remaining
will be repaid to the Company.
Section 12.5 CORPORATE EXISTENCE.
- ---------------------------------
Subject to Article 10, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence
and the corporate existence of each of its Subsidiaries; provided, however, that
the Company shall not be required to preserve the corporate existence of any
Subsidiary if the Company
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shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company.
Section 12.6 WAIVER OF CERTAIN COVENANTS.
- -----------------------------------------
Any Obligor may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 12.1 and 12.3 through 12.5 (and, if
so specified pursuant to Section 3.1, any other covenant not set forth herein
and specified pursuant to Section 3.1 to be applicable to the Debt Securities of
any series, except as otherwise provided pursuant to Section 3.1) with respect
to the Debt Securities of any series if before the time for such compliance the
holders of at least at least a majority in principal amount of the Outstanding
Debt Securities of such series shall, by Act of such holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent expressly so waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
ARTICLE 13
REDEMPTION OF DEBT SECURITIES
Section 13.1 APPLICABILITY OF ARTICLE.
- --------------------------------------
Debt Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified pursuant to Section 3.1 for Debt Securities of any series)
in accordance with this Article.
Section 13.2 ELECTION TO REDEEM; NOTICE TO TRUSTEE.
- ---------------------------------------------------
The election of the Company to redeem any Debt Securities shall be evidenced
by a Board Resolution. In case of any redemption at the election of the Company
of less than all of the Debt Securities of any series pursuant to Section 13.3,
the Company shall, at least 30 days before the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee of such Redemption Date and of the principal amount of Debt
Securities of such series to be redeemed. In the case of any redemption of Debt
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Debt Securities or elsewhere in this Indenture,
the Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restrictions.
Section 13.3 SELECTION BY TRUSTEE OF DEBT SECURITIES TO BE REDEEMED.
- --------------------------------------------------------------------
If less than all the Debt Securities of any series are to be redeemed at the
election of the Company, the particular Debt Securities to be redeemed shall be
selected not more than 60 days prior to the Redemption Date by the Trustee, from
the Outstanding Debt Securities of such series not previously called for
redemption, by such method as the Trustee shall deem fair and appropriate and
which may provide for the selection for redemption of portions (equal to $1,000
denominations for
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Debt Securities of such series or any integral multiple thereof) of the
principal amount of Debt Securities of such series in a denomination larger than
$1,000 denominations. The portions of the principal amount of Debt Securities so
selected for partial redemption shall be in denominations of $1,000 or any
integral multiple thereof, except as otherwise set forth in the applicable form
of Debt Securities. In any case when more than one Debt Security of such series
is registered in the same name, the Trustee, in its discretion, may treat the
aggregate principal amount so registered as if it were represented by one Debt
Security of such series.
The Trustee shall promptly notify the Company and the Security Registrar (if
other than itself) in writing of the Debt Securities selected for redemption
and, in the case of any Debt Securities selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Debt Securities shall relate, in
the case of any Debt Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Debt security which has been or is to be
redeemed.
Section 13.4 NOTICE OF REDEMPTION.
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Notice of redemption shall be given by the Company, or at the Company's
request, by the Trustee in the name and at the expense of the Company, not less
than 30 days and not more than 60 days prior to the Redemption Date to the
holders of Debt Securities of any series to be redeemed in whole or in part
pursuant to this Article 13, in the manner provided in Section 18.2. Any notice
so given shall be conclusively presumed to have been duly given, whether or not
the holder receives such notice. Failure to give such notice, or any defect in
such notice to the holder of any Debt Security of a series designated for
redemption, in whole or in part, shall not affect the sufficiency of any notice
of redemption with respect to the holder of any other Debt Security of such
series.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price,
(c) that Debt Securities of such series are being redeemed by the Company
pursuant to provisions contained in this Indenture or the terms of the Debt
Securities of such series or a supplemental indenture establishing such series,
if such be the case, together with a brief statement of the facts permitting
such redemption,
(d) if less than all Outstanding Debt Securities of any series are to be
redeemed, the identification (and, in the case of partial redemption, the
principal amounts) of the particular Debt Securities to be redeemed,
(e) that on the Redemption Date the Redemption Price will become due and
payable upon each such Debt Security to be redeemed, and that interest thereon,
if any, shall cease to accrue on and after said date,
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(f) the Place or Places of Payment where such Debt Securities are to be
surrendered for payment of the Redemption Price, and
(g) that the redemption is for a sinking fund, if such is the case.
Section 13.5 DEPOSIT OF REDEMPTION PRICE.
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On or prior to the Redemption Date for any Debt Securities, the Company
shall deposit with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as provided in
Section 12.4) an amount of money in the Currency or Currencies in which such
Debt Securities are denominated (except as provided pursuant to Section 3.1)
sufficient to pay the Redemption Price of such Debt Securities or any portions
thereof which are to be redeemed on that date.
Section 13.6 DEBT SECURITIES PAYABLE ON REDEMPTION DATE.
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Notice of redemption having been given as aforesaid, any Debt Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price (except as otherwise specified pursuant to Section 3.1 or 3.4),
and from and after such date (unless the Company shall default in the payment of
the Redemption Price) such Debt Securities shall cease to bear interest. Upon
surrender of any such Debt Security for redemption in accordance with said
notice, such Debt Security shall be paid by the Company at the Redemption Price;
provided, however, that, unless otherwise specified as contemplated by Section
3.1, installments of interest on Debt Securities which have a Stated Maturity on
or prior to the Redemption Date for such Debt Securities shall be payable
according to the terms of such Debt Securities and the provisions of Section
3.7.
If any Debt Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Debt Security.
Section 13.7 DEBT SECURITIES REDEEMED IN PART.
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Any Debt Security which is to be redeemed only in part shall be
surrendered at the Corporate Trust Office or such other office or agency of the
Company as is specified pursuant to Section 3.1 with, if the Company, the
Security Registrar or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company, the Security
Registrar and the Trustee duly executed by, the holder thereof or such holder's
attorney duly authorized in writing, and the Company shall execute, and the
Trustee shall authenticate and deliver to the holder of such Debt Security
without service charge, a new Debt Security or Debt Securities of the same
series, of like tenor and form, of any authorized denomination as requested by
such holder in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Debt Security so surrendered. In the
case of a Debt Security providing appropriate space for such notation, at the
option of the holder thereof, the Trustee, in lieu of delivering a new Debt
Security or Debt Securities as aforesaid, may make a notation on such Debt
Security of the payment of the redeemed portion thereof.
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ARTICLE 14
SINKING FUNDS
Section 14.1 APPLICABILITY OF ARTICLE.
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The provisions of this Article shall be applicable to any sinking fund for
the retirement of Debt Securities of a series except as otherwise specified
pursuant to Section 3.1 for Debt Securities of such series.
The minimum amount of any sinking fund payment provided for by the terms of
Debt Securities of any series is herein referred to as a "mandatory sinking fund
payment," and any payment in excess of such minimum amount provided for by the
terms of Debt Securities of any series is herein referred to as an "optional
sinking fund payment." If provided for by the terms of Debt Securities of any
series, the amount of any cash sinking fund payment may be subject to reduction
as provided in Section 14.2. Each sinking fund payment shall be applied to the
redemption of Debt Securities of any series as provided for by the terms of Debt
Securities of such series.
Section 14.2 SATISFACTION OF MANDATORY SINKING FUND PAYMENTS WITH DEBT
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SECURITIES.
- ----------
In lieu of making all or any part of a mandatory sinking fund payment with
respect to any Debt Securities of a series in cash, the Company may at its
option, at any time no more than sixteen months and no less than 45 days prior
to the date on which such sinking fund payment is due, deliver to the Trustee
Debt Securities of such series theretofore purchased or otherwise acquired by
the Company, except Debt Securities of such series which have been redeemed
through the application of mandatory sinking fund payments pursuant to the terms
of the Debt Securities of such series, accompanied by a Company Order
instructing the Trustee to credit such obligations and stating that the Debt
Securities of such series were originally issued by the Company by way of bona
fide sale or other negotiation for value, provided that such Debt Securities
shall not have been previously so credited. Such Debt Securities shall be
received and credited for such by the Trustee at the Redemption Price specified
in such Debt Securities for redemption through operation of the sinking fund and
the amount of such mandatory sinking fund payment shall be reduced accordingly.
Section 14.3 REDEMPTION OF DEBT SECURITIES FOR SINKING FUND.
- ------------------------------------------------------------
Not less than 60 days prior to each sinking fund payment date for any series
of Debt Securities (unless a shorter period shall be satisfactory to the
Trustee), the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash (except as provided pursuant to Section 3.1) and
the portion thereof, if any, which is to be satisfied by delivering and
crediting Debt Securities of such series pursuant to Section 14.2 and whether
the Company intends to exercise its rights to make a permitted optional sinking
fund payment with respect to such series. Such certificate shall be irrevocable
and,
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upon its delivery, the Company shall be obligated to make the cash payment or
payments therein referred to, if any, on or before the next succeeding sinking
fund payment date. In the case of the failure of the Company to deliver such
certificate, the sinking fund payment due on the next succeeding sinking fund
payment date for such series shall be paid entirely in cash and shall be
sufficient to redeem the principal amount of the Debt Securities of such series
subject to a mandatory sinking fund payment without the right to deliver or
credit Debt Securities as provided in Section 14.2 and without the right to make
any optional sinking fund payment with respect to such series at such time.
Any sinking fund payment or payments (mandatory or optional) made in cash
plus any unused balance of any preceding sinking fund payments made with respect
to the Debt Securities of any particular series shall be applied by the Trustee
(or by the Company if the Company is acting as its own Paying Agent) on the
sinking fund payment date on which such payment is made (or, if such payment is
made before a sinking fund payment date, on the sinking fund payment date
immediately following the date of such payment) to the redemption of Debt
Securities of such series at the Redemption Price specified in such Debt
Securities with respect to the sinking fund. Any sinking fund moneys not so
applied or allocated by the Trustee (or by the Company if the Company is acting
as its own Paying Agent) to the redemption of Debt Securities shall be added to
the next sinking fund payment received by the Trustee (or if the Company is
acting as its own Paying Agent, segregated and held in trust as provided in
Section 12.4) for such series and, together with such payment (or such amount so
segregated) shall be applied in accordance with the provisions of this Section.
Any and all sinking fund moneys with respect to the Debt Securities of any
particular series held by the Trustee (or if the Company is acting as its own
Paying Agent, segregated and held in trust as provided in Section 12.4) on the
last sinking fund payment date with respect to Debt Securities of such series
and not held for the payment or redemption of particular Debt Securities of such
series shall be applied by the Trustee (or by the Company if the Company is
acting as its own Paying Agent), together with other moneys, if necessary, to be
deposited (or segregated) sufficient for the purpose, to the payment of the
principal of the Debt Securities of such series at Maturity.
The Trustee shall select or cause to be selected the Debt Securities to be
redeemed upon such sinking fund payment date in the manner specified in Section
13.3 and the Company shall cause notice of the redemption thereof to be given in
the manner provided in Section 13.4. Such notice having been duly given, the
redemption of such Debt Securities shall be made upon the terms and in the
manner stated in Section 13.6.
On or before each sinking fund payment date, the Company shall pay to the
Trustee (or, if the Company is acting as its own Paying Agent, the Company shall
segregate and hold in trust as provided in Section 12.4) in cash a sum, equal to
the principal and any interest accrued to the Redemption Date for Debt
Securities or portions thereof to be redeemed on such sinking fund payment date
pursuant to this Section.
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ARTICLE 15
DEFEASANCE
Section 15.1 APPLICABILITY OF ARTICLE.
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Except as otherwise provided in Section 15.2 or as provided pursuant to
Section 3.1 with respect to a particular series of Debt Securities, the Company
may terminate its obligations under the Debt Securities of any series and this
Indenture with respect to Debt Securities of such series as set forth in Section
15.2.
Section 15.2 DEFEASANCE UPON DEPOSIT OF MONEYS OR U.S. GOVERNMENT OBLIGATIONS.
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At the Company's option, either (a) the Company shall be deemed to have been
Discharged (as defined below) from its obligations with respect to Debt
Securities of any series ("legal defeasance option") or (b) the Company shall
cease to be under any obligation to comply with any term, provision or condition
set forth in Sections 10.1, 12.2 and 12.4 with respect to Debt Securities of any
series (and, to the extent so specified pursuant to Section 3.1, any other
obligation of the Company or restrictive covenant added for the benefit of such
series pursuant to Section 3.1) ("covenant defeasance option") at any time after
the applicable conditions set forth below have been satisfied:
(a) The Company shall have deposited or caused to be deposited irrevocably
with the Trustee as trust funds in trust, specifically pledged as security for,
and dedicated solely to, the benefit of the holders of the Debt Securities of
such series (i) money in an amount, or (ii) U.S. Government Obligations (as
defined below) which through the payment of interest and principal in respect
thereof in accordance with their terms will provide, not later than one day
before the due date of any payment, money in an amount, or (iii) a combination
of (i) and (ii), sufficient, in the opinion (with respect to (i) and (ii)) of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and discharge
each installment of principal (including any mandatory sinking fund payments) of
and premium, if any, and interest on, the Outstanding Debt Securities of such
series on the dates such installments of interest or principal and premium are
due;
(b) Such deposit shall not cause the Trustee with respect to the Debt
Securities of that series to have a conflicting interest as defined in Section
6.8 and for purposes of the Trust Indenture Act with respect to the Debt
Securities of any series;
(c) Such deposit will not result in a breach or violation of, or constitute
a default under, this Indenture or any other agreement or instrument to which
the Company is a party or by which it is bound;
(d) If the Debt Securities of such series are then listed on any national
securities exchange, the Company shall have delivered to the Trustee an Opinion
of Counsel or a letter or other document from such exchange to the effect that
the Company's exercise of its option under this Section would not cause such
Debt Securities to be delisted;
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(e) No Event of Default or Default with respect to the Debt Securities of
such series shall have occurred and be continuing on the date of such deposit
and, with respect to the legal defeasance option only, no Event of Default under
Section 5.1(f) or Section 5.1(g) or event which with the giving of notice or
lapse of time, or both, would become an Event of Default under Section 5.1(f) or
Section 5.1(g) shall have occurred and be continuing on the 91st day after such
date (and such defeasance shall not become effective until such 91st day); and
(f) The Company shall have delivered to the Trustee an Opinion of Counsel or
a ruling from the Internal Revenue Service to the effect that the holders of the
Debt Securities of such series will not recognize income, gain or loss for
United States Federal income tax purposes as a result of such deposit,
defeasance or Discharge. Notwithstanding the foregoing, if the Company
exercises its covenant defeasance option and an Event of Default under Section
5.1(f) or Section 5.1(g) or event which, with the giving of notice or lapse of
time, or both, would become an Event of Default under Section 5.1(f) or Section
5.1(g) shall have occurred and be continuing on the 91st day after the date of
such deposit, the obligations of the Company referred to under the definition of
covenant defeasance option with respect to such Debt Securities shall be
reinstated.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Debt Securities of such series and to have satisfied all the obligations under
this Indenture relating to the Debt Securities of such series (and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging
the same), except (A) the rights of holders of Debt Securities of such series to
receive, from the trust fund described in clause (1) above, payment of the
principal of (and premium, if any) and interest on such Debt Securities when
such payments are due, (B) the Company's obligations with respect to the Debt
Securities of such series under Sections 3.4(a), 3.5, 3.6, 12.3 and 15.3 and (C)
the rights, powers, trusts, duties and immunities of the Trustee hereunder.
"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States for the payment of which its full faith and
credit is pledged, or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States, which, in either case under clauses (i) or (ii), are not callable
or redeemable at the option of the issuer thereof, and shall also include
depository receipt issued by a bank or trust company as custodian with respect
to any such U.S. Government Obligation or a specific payment of interest on or
principal of any such U.S. Government Obligation held by such custodian for the
account of the holder of a depository receipt; provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Government Obligation evidenced by such
depository receipt.
Section 15.3 DEPOSITED MONEYS AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD
INTRUST.
All moneys and U.S. Government Obligations deposited with the Trustee
pursuant to Section 15.2 in respect of Debt Securities of a series shall be held
in trust and applied by it, in accordance with the
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provisions of such Debt Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the holders of such Debt
Securities, of all sums due and to become due thereon for principal (and
premium, if any) and interest, if any, but such money need not be segregated
from other funds except to the extent required by law.
Section 15.4 REPAYMENT TO COMPANY.
- ----------------------------------
The Trustee and any Paying Agent shall promptly pay or return to the Company
upon Company Request any moneys or U.S. Government Obligations held by them at
any time that are not required for the payment of the principal of (and premium,
if any) and interest on the Debt Securities of any series for which money or
U.S. Government Obligations have been deposited pursuant to Section 15.2.
The provisions of the last paragraph of Section 12.4 shall apply to any
money held by the Trustee or any Paying Agent under this Article that remains
unclaimed for two years after the Maturity of any series of Debt Securities for
which money or U.S. Government Obligations have been deposited pursuant to
Section 15.2.
ARTICLE 16
CONVERSION
Section 16.1 APPLICABILITY; CONVERSION PRIVILEGE.
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Except as otherwise specified pursuant to Section 3.1 for Debt Securities of
any series, the provisions of this Article 16 shall be applicable to any Debt
Securities that are convertible into Common Stock. If so provided pursuant to
Section 3.1 with respect to the Debt Securities of any series, the holder of a
Debt Security of such series shall have the right, at such holder's option, to
convert, in accordance with the terms of such series of Debt Securities and this
Article 16, all or any part (in a denomination of, unless otherwise specified
pursuant to Section 3.1 with respect to Debt Securities of such series, $1,000
in principal amount or any integral multiple thereof) of such Debt Security into
shares of Common Stock or, as to any Debt Securities called for redemption, at
any time prior to the time and date fixed for such redemption (unless the
Company shall default in the payment of the Redemption Price, in which case such
right shall not terminate at such time and date).
Section 16.2 CONVERSION PROCEDURE; CONVERSION PRICE; FRACTIONAL SHARES.
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(a) Each Debt Security to which this Article is applicable shall be
convertible at the office of the Conversion Agent, and at such other place or
places, if any, specified pursuant to Section 3.1 with respect to the Debt
Securities of such series, into fully paid and nonassessable shares (calculated
to the nearest 1/100th of a share) of Common Stock. The Debt Securities will be
converted into shares of Common Stock at the Conversion Price therefor. No
payment or adjustment shall be made in respect of dividends on the Common Stock
or accrued interest on a converted Debt Security except as described in Section
16.9. The Company may, but shall not be required, in connection with any
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conversion of Debt Securities, to issue a fraction of a share of Common Stock
and, if the Company shall determine not to issue any such fraction, the Company
shall, subject to Section 16.3(d), make a cash payment (calculated to the
nearest cent) equal to such fraction multiplied by the Closing Price of the
Common Stock on the last Trading Day prior to the date of conversion.
(b) Before any holder of a Debt Security shall be entitled to convert the
same into Common Stock, such holder shall surrender such Debt Security duly
endorsed to the Company or in blank at the office of the Conversion Agent or at
such other place or places, if any, specified pursuant to Section 3.1, and shall
give written notice to the Company at said office or place that such holder
elects to convert the same and shall state in writing therein the principal
amount of Debt Securities to be converted and the name or names (with addresses)
in which such holder wishes the certificate or certificates for Common Stock to
be issued; provided, however, that no Debt Security or portion thereof shall be
accepted for conversion unless the principal amount of such Debt Security or
such portion, when added to the principal amount of all other Debt Securities or
portions thereof then being surrendered by the holder thereof for conversion,
exceeds the then-effective Conversion Price with respect thereto. If more than
one Debt Security shall be surrendered for conversion at one time by the same
holder, the number of full shares of Common Stock which shall be deliverable
upon conversion shall be computed on the basis of the aggregate principal amount
of the Debt Securities (or specified portions thereof to the extent permitted
thereby) so surrendered. Subject to the next succeeding sentence, the Company
will, as soon as practicable thereafter, issue and deliver at said office or
place to such holder of a Debt Security, or to such holder's nominee or
nominees, certificates for the number of full shares of Common Stock to which
such holder shall be entitled as aforesaid, together, subject to the last
sentence of paragraph (a) above, with cash in lieu of any fraction of a share to
which such holder would otherwise be entitled. The Company shall not be
required to deliver certificates for shares of Common Stock while the stock
transfer books for such stock or the Security Register are duly closed for any
purpose, but certificates for shares of Common Stock shall be issued and
delivered as soon as practicable after the opening of such books or Security
Register. A Debt Security shall be deemed to have been converted as of the
close of business on the date of the surrender of such Debt Security for
conversion as provided above, and the Person or Persons entitled to receive the
Common Stock issuable upon such conversion shall be treated for all purposes as
the record holder or holders of such Common Stock as of the close of business on
such date. In case any Debt Security shall be surrendered for partial
conversion, the Company shall execute and the Trustee shall authenticate and
deliver to or upon the written order of the holder of the Debt Securities so
surrendered, without charge to such holder (subject to the provisions of Section
16.8), a new Debt Security or Securities in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered
Debt Security.
Section 16.3 ADJUSTMENT OF CONVERSION PRICE FOR COMMON STOCK.
- -------------------------------------------------------------
The Conversion Price with respect to any Debt Security which is convertible
into Common Stock shall be adjusted from time to time as follows:
(a) In case the Company shall, at any time or from time to time while any of
such Debt Securities are outstanding, (i) pay a dividend in shares of its Common
Stock to holders of Common Stock, (ii) combine its
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outstanding shares of Common Stock into a smaller number of shares of Common
Stock, (iii) subdivide its outstanding shares of Common Stock into a greater
number of shares of Common Stock or (iv) make a distribution in shares of Common
Stock to holders of Common Stock, then the Conversion Price in effect
immediately before such action shall be adjusted so that the holders of such
Debt Securities, upon conversion thereof into Common Stock immediately following
such event, shall be entitled to receive the kind and amount of shares of Common
Stock of the Company which they would have owned or been entitled to receive
upon or by reason of such event if such Debt Securities had been converted
immediately before the record dated (or, if no record date, the effective date)
for such event. An adjustment made pursuant to this Section 16.3(a) shall become
effective retroactively immediately after the record date in the case of a
dividend or distribution and shall become effective retroactively immediately
after the effective date in the case of a subdivision or combination. For the
purposes of this Section 16.3(a), each holder of Debt Securities shall be deemed
to have failed to exercise any right to elect the kind or amount of securities
receivable upon the payment of any such dividend, subdivision, combination or
distribution (provided, that if the kind or amount of securities receivable upon
such dividend, subdivision, combination or distribution is not the same for each
nonelecting share, then the kind and amount of securities or other property
receivable upon such dividend, subdivision, combination or distribution for each
nonelecting share shall be deemed to be the kind and amount so receivable per
share by a plurality of the nonelecting shares).
(b) In case the Company shall, at any time or from time to time while any of
such Debt Securities are outstanding, issue rights or warrants to all holders of
shares of its Common Stock entitling them (for a period expiring within 45 days
after the record date for such issuance) to subscribe for or purchase shares of
Common Stock (or securities convertible into shares of Common Stock) at a price
per share less than the Current Market Price of the Common Stock at such record
date (treating the price per share of the securities convertible into Common
Stock as equal to (x) the sum of (i) the price for a unit of the security
convertible into Common Stock and (ii) any additional consideration initially
payable upon the conversion of such security into Common Stock divided by (y)
the number of shares of Common Stock initially underlying such convertible
security), the Conversion Price with respect to such Debt Securities shall be
adjusted so that it shall equal the price determined by dividing the Conversion
Price in effect immediately prior to the date of issuance of such rights or
warrants by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights or warrants plus
the number of additional shares of Common Stock offered for subscription or
purchase (or into which the convertible securities so offered are initially
convertible), and the denominator of which shall be the number of shares of
Common Stock outstanding on the date of issuance of securities which the
aggregate offering price of the total number of shares of securities so offered
for subscription or purchase (or the aggregate purchase price of the convertible
securities so offered plus the aggregate amount of any additional consideration
initially payable upon conversion of such securities into Common Stock) would
purchase at such Current Market Price of the Common Stock. Such adjustment
shall become effective retroactively immediately after the record date for the
determination of stockholders entitled to receive such rights or warrants.
(c) In the case the Company shall, at any time or from time to time while
any of such Debt Securities are outstanding, distribute to all holders of shares
of its Common Stock (including any such distribution
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made in connection with a consolidation or merger in which the Company is the
continuing corporation and the Common Stock is not changed or exchanged) cash,
evidences of its indebtedness, securities or assets (excluding (i) regular
periodic cash dividends in amounts, if any, determined from time to time by the
Board of Directors, (ii) dividends payable in shares of Common Stock for which
adjustment is made under Section 16.3(a) or (iii) rights or warrants to
subscribe for or purchase securities of the Company (excluding those referred to
in Section 16.3(b)), then in each such case the Conversion Price with respect to
such Debt Securities determined by dividing the Conversion Price in effect
immediately prior to the date of such distribution by a fraction, the numerator
of which shall be the Current Market Price of the Common Stock on the record
date referred to below, and the denominator of which shall be such Current
Market Price of the Common Stock less the then fair market value (as determined
by the Board of Directors of the Company, whose determination shall be
conclusive) of the portion of the cash or assets or evidences of indebtedness or
securities so distributed or of such subscription rights or warrants applicable
to one share of Common Stock (provided that such denominator shall never be less
than 1.0); provided, however, that no adjustment shall be made with respect to
any distribution of rights to purchase securities of the Company if a holder of
Debt Securities would otherwise be entitled to receive such rights upon
conversion at any time of such Debt Securities into Common Stock unless such
rights are subsequently redeemed by the Company, in which case such redemption
shall be treated for purposes of this Section as a dividend on the Common Stock.
Such adjustment shall become effective retroactively immediately after the
record date for the determination of stockholders entitled to receive such
distribution; and in the event that such distribution is not so made, the
Conversion Price shall again be adjusted to the Conversion Price which would
then be in effect if such record date had not been fixed.
(d) The Company shall be entitled to make such additional adjustments in the
Conversion Price, in addition to those required by subsections 16.3(a), 16.3(b),
and 16.3(c), as shall be necessary in order that any dividend or distribution of
Common Stock, any subdivision, reclassification or combination of shares of
Common Stock or any issuance of rights or warrants referred to above shall not
be taxable to the holders of Common Stock for United States Federal income tax
purposes.
(e) In any case in which this Section 16.3 shall require that any adjustment
be made effective as of or retroactively immediately following a record date,
the Company may elect to defer (but only for five (5) Trading Days following the
filing of the statement referred to in Section 16.5) issuing to the holder of
any Debt Securities converted after such record date the shares of Common Stock
and other capital stock of the Company issuable upon such conversion over and
above the shares of Common Stock and other capital stock of the Company issuable
upon such conversion on the basis of the Conversion Price prior to adjustment;
provided, however, that the Company shall deliver to such holder a due bill or
other appropriate instrument evidencing such holder's right to receive such
additional shares upon the occurrence of the event requiring such adjustment.
(f) All calculations under this Section 16.3 shall be made to the nearest
cent or one-hundredth of a share of security, with one-half cent and 0.005 of a
share, respectively, being rounded upward. Notwithstanding any other provision
of this Section 16.3, the Company shall not be required to make any adjustment
of the Conversion Price unless such adjustment would require an increase or
decrease of at least 1% of such price. Any lessor adjustment shall be carried
forward and
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shall be made at the time of, and together with, the next subsequent adjustment
which, together with any adjustment or adjustments so carried forward, shall
amount to an increase or decrease of at least 1% in such price. Any adjustments
under this Section 16.3 shall be made successively whenever an event requiring
such an adjustment occurs.
(g) In the event that at any time, as a result of an adjustment made
pursuant to this Section 16.3, the holder of any Debt Security thereafter
surrendered for conversion shall become entitled to receive any shares of stock
of the Company other than shares of Common Stock into which the Debt Securities
originally were convertible, the Conversion Price of such other shares so
receivable upon conversion of any such Debt Security shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to Common Stock contained in
subparagraphs (a) through (f) of this Section 16.3, and the provisions of
Sections 16.1, 16.2 and 16.4 through 16.9 with respect to the Common Stock shall
apply on like or similar terms to any such other shares and the determination of
the Board of Directors as to any such adjustment shall be conclusive.
(h) No adjustment shall be made pursuant to this Section: (i) if the effect
thereof would be to reduce the Conversion Price below the par value (if any) of
the Common Stock or (ii) subject to 16.3(e) hereof, with respect to any Debt
Security that is converted prior to the time such adjustment otherwise would be
made.
Section 16.4 CONSOLIDATION OR MERGER OF THE COMPANY.
- ----------------------------------------------------
In case of either (a) any consolidation or merger to which the Company is a
party, other than a merger or consolidation in which the company is the
surviving or continuing corporation and which does not result in a
reclassification of, or change (other than a change in par value or from par
value to no par value or from no par value to par value, as a result of a
subdivision or combination) in, outstanding shares of Common Stock or (b) any
sale or conveyance of all or substantially all of the property and assets of the
Company to another Person, each Debt Security then outstanding shall be
convertible from and after such merger, consolidation, sale or conveyance of
property and assets into the kind and amount of shares of stock or other
securities and property (including cash) receivable upon such consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
into which such Debt Securities would have been converted immediately prior to
such consolidation, merger, sale or conveyance, subject to adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article Sixteen (and assuming such holder of Common Stock failed to
exercise his rights of election, if any, as to the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance (provided that, if the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance is not the same for each nonelecting share, then the
kind and amount of securities, cash or other property (including cash)
receivable upon such consolidation, merger, sale or conveyance for each
nonelecting share shall be deemed to be the kind and amount so receivable per
share by a plurality of the nonelecting shares or securities)). The Company
shall not enter into any of the transactions referred to in clause (a) or (b) of
the preceding sentence unless effective provision shall be made so as to give
effect to the provisions set forth in this Section 16.4. The provisions of this
Section 16.4 shall apply similarly to successive consolidations, mergers, sales
or conveyances.
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Section 16.5 NOTICE OF ADJUSTMENT.
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Whenever an adjustment in the Conversion Price with respect to a series of
Debt Securities is required:
(a) the Company shall forthwith place on file with the Trustee and any
Conversion Agent for such Securities a certificate of the Treasurer of the
Company, stating the adjusted Conversion Price determined as provided herein and
setting forth in reasonable detail such facts as shall be necessary to show the
reason for and the manner of computing such adjustment, such certificate to be
conclusive evidence that the adjustment is correct; and
(b) a notice stating that the Conversion Price has been adjusted and setting
forth the adjusted Conversion Price shall forthwith be given by the Company, or
at the Company's request, by the Trustee in the name and at the expense of the
Company, in the manner provided in Section 18.2. Any notice so given shall be
conclusively presumed to have been duly given, whether or not the holder
receives such notice.
Section 16.6 NOTICE IN CERTAIN EVENTS.
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In case:
(a) of a consolidation or merger to which the Company is a party and for
which approval of any stockholders of the Company is required, or of the sale or
conveyance to another Person or entity or group of Persons or entities acting in
concert as a partnership, limited partnership, syndicate or other group (within
the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended)
of all or substantially all of the property and assets of the Company; or
(b) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(c) of any action triggering an adjustment of the Conversion Price pursuant
to this Article Sixteen;
then, in each case, the Company shall cause to be filed with the Trustee and the
Conversion Agent for the applicable Debt Securities, and shall cause to be
given, to the holders of record of applicable Debt Securities in the manner
provided in Section 18.2, at least fifteen (15) days prior to the applicable
date hereinafter specified, a notice stating (x) the date on which a record is
to be taken for the purpose of any distribution or grant of rights or warrants
triggering an adjustment to the Conversion Price pursuant to this Article
Sixteen, or, if a record is not to be taken, the date as of which the holders of
record or Common Stock entitled to such distribution, rights or warrants are to
be determined, or (y) the date on which any reclassification, consolidation,
merger, sale, conveyance, dissolution, liquidation or winding up triggering an
adjustment to the Conversion Price pursuant to this Article 16 is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their Common Stock for securities
or other property deliverable upon such reclassification, consolidation, merger,
sale, conveyance, dissolution, liquidation or winding up.
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Failure to give such notice or any defect therein shall not affect the
legality or validity of the proceedings described in clause (a), (b), or (c) of
this Section.
Section 16.7 COMPANY TO RESERVE STOCK; REGISTRATION; LISTING.
- -------------------------------------------------------------
(a) The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued shares of Common Stock,
for the purpose of effecting the conversion of the Debt Securities, such number
of its duly authorized shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all applicable outstanding Debt
Securities into such Common Stock at any time (assuming that, at the time of the
computation of such number of shares or securities, all such Debt Securities
would be held by a single holder); provided, however, that nothing contained
herein shall preclude the Company from satisfying its obligations in respect of
the conversion of the Debt Securities by delivery of purchased shares of Common
Stock which are held in the treasury of the Company. The Company shall from
time to time, in accordance with the laws of the State of Delaware, use its best
efforts to cause the authorized amount of the Common Stock to be increased if
the aggregate of the authorized amount of the Common Stock remaining unissued
and the issued shares of such Common Stock in its treasury (other than any such
shares reserved for issuance in any other connection) shall not be sufficient to
permit the conversion of all Debt Securities.
(b) If any shares of Common Stock which would be issuable upon conversion of
Debt Securities hereunder require registration with or approval of any
governmental authority before such shares or securities may be issued upon such
conversion, the Company will in good faith and as expeditiously as possible
endeavor to cause such shares or securities to be duly registered or approved,
as the case may be. The Company will endeavor to list the shares of Common
Stock required to be delivered upon conversion of the Debt Securities prior to
such delivery upon the principal national securities exchange upon which the
outstanding Common Stock is listed at the time of such delivery.
Section 16.8 TAXES ON CONVERSION.
- ---------------------------------
The Company shall pay any and all documentary, stamp or similar issue or
transfer taxes that may be payable in respect of the issue or delivery of shares
of Common Stock on conversion of Debt Securities pursuant hereto. The Company
shall not, however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issue or delivery of shares of Common
Stock or the portion, if any, of the Debt Securities which are not so converted
in a name other than that in which the Debt Securities so converted were
registered, and no such issue or delivery shall be made unless and until the
Person requesting such issue has paid to the Company the amount of such tax or
has established to the satisfaction of the Company that such tax has been paid.
Section 16.9 CONVERSION AFTER RECORD DATE.
- ------------------------------------------
If any Debt Securities are surrendered for conversion subsequent to the
record date preceding an Interest Payment Date but on or prior to such Interest
Payment Date (except Debt Securities called for redemption on a Redemption Date
between such record date and Interest
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Payment Date), the holder of such Debt Securities at the close of business on
such record date shall be entitled to receive the interest payable on such Debt
Securities on such Interest Payment Date notwithstanding the conversion thereof.
Debt Securities surrendered for conversion during the period from the close of
business on any record date next preceding any Interest Payment Date to the
opening of business on such Interest Payment Date shall (except in the case of
Debt Securities which have been called for redemption on a Redemption Date
within such period) be accompanied by payment in New York Clearing House funds
or other funds of an amount equal to the interest payable on such Interest
Payment Date on the Debt Securities being surrendered for conversion. Except as
provided in this Section 16.9, no adjustments in respect of payments of interest
on Debt Securities surrendered for conversion or any dividends or distributions
of interest on the Common Stock issued upon conversion shall be made upon the
conversion of any Debt Securities.
Section 16.10 COMPANY DETERMINATION FINAL.
- ------------------------------------------
Any determination that the Company or the Board of Directors must make
pursuant to this Article is conclusive.
Section 16.11 TRUSTEE'S DISCLAIMER.
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The Trustee has no duty to determine when an adjustment under this Article
should be made, how it should be made or what it should be. The Trustee makes
no representation as to the validity or value of any securities or assets issued
upon conversion of Debt Securities. The Trustee shall not be responsible for
the Company's failure to comply with this Article. Each Conversion Agent other
than the Company shall have the same protection under this Section as the
Trustee.
ARTICLE 17
GUARANTEES
Section 17.1 APPLICABILITY OF ARTICLE.
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The provisions of this Article shall be applicable to any series of Debt
Securities which is to be guaranteed by one or more Guarantors.
Section 17.2 OBLIGOR GUARANTEE.
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The Guarantors unconditionally and jointly and severally guarantee and
promise to pay to the holders and the Trustee (each a "Beneficiary"), on demand
made at any time while an Event of Default exists, in lawful money of the United
States of America, any and all Obligations of the Company from time to time owed
to the Beneficiaries (the "Obligor Guarantee"). The term "Obligations" means any
and all present and future obligations and liabilities of the Company of every
type and description to the Beneficiaries under this Indenture and the Debt
Securities of the series such Guarantors have guaranteed (the "Guaranteed
Securities"), whether for principal, premium (if any), interest, expenses,
indemnities or other amounts, in each case whether due or not due, absolute or
contingent, voluntary or involuntary, liquidated or unliquidated, determined or
undetermined, now or hereafter existing, renewed or
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restructured, whether or not from time to time decreased or extinguished and
later increased, created or incurred, whether or not arising after the
commencement of a proceeding under the Bankruptcy Code (including post-petition
interest) and whether or not allowed or allowable as a claim in any such
proceeding, and whether or not recovery of any such obligation or liability may
be barred by a statute of limitations or such obligation or liability may
otherwise be unenforceable. All Obligations shall be conclusively presumed to
have been created in reliance on the Obligor Guarantee. The Obligor Guarantee is
a continuing Guarantee of the Obligations and, except as otherwise provided in
this Indenture, may not be revoked and shall not otherwise terminate unless and
until any and all Obligations have been indefeasibly paid and performed in full.
Section 17.3 NATURE OF OBLIGOR GUARANTEE.
- ------------------------------------------
The liability of each Guarantor under the Obligor Guarantee is independent
of and not in consideration of or contingent upon the liability of the Company
or any other Obligor, and a separate action or actions may be brought and
prosecuted against any Guarantor, whether or not any action is brought or
prosecuted against the Company or any other Obligor or whether the Company or
any other Obligor is joined in any such action or actions. The Obligor Guarantee
given by each Guarantor shall be construed as a continuing, absolute and
unconditional Guarantee of payment (and not merely of collection) without regard
to:
(a) the legality, validity or enforceability of the Debt Securities
or this Indenture, any of the Obligations, any security or Obligor Guarantee
given by any other Guarantor;
(b) any defense (other than payment), set-off or counterclaim that may at
any time be available to the Company or any other Obligor against, and any right
of setoff at any time held by, any Beneficiary; or
(c) any other circumstance whatsoever (with or without notice to or
knowledge of any Guarantor or any other Obligor), whether or not similar to any
of the foregoing, that constitutes, or might be construed to constitute, an
equitable or legal discharge of the Company or any other Obligor, in bankruptcy
or in any other instance.
Any payment by any Obligor or other circumstance that operates to toll any
statute of limitations applicable to such Obligor shall also operate to toll the
statute of limitations applicable to each Guarantor.
Section 17.4 AUTHORIZATION.
- ---------------------------
Each Guarantor authorizes each Beneficiary, without notice or further assent
by such Guarantor, and without affecting any Guarantor's liability hereunder
(regardless of whether any subrogation or similar right that such Guarantor may
have or any other right or remedy of such Guarantor is extinguished or
impaired), from time to time to do any or all of the following :
(a) permit the Company to increase or create Obligations, or terminate,
release, compromise, subordinate, extend, accelerate or otherwise change the
amount or time, manner or place of payment of, or rescind any demand for payment
or acceleration of, the Obligations or any part thereof, consent or enter into
supplemental indentures or otherwise amend the terms and conditions of the
Guaranteed Securities or this Indenture or any provision thereof,
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(b) take and hold any collateral from the Company or any other Person,
perfect or refrain from perfecting a lien on any collateral, and exchange,
enforce, subordinate, release (whether intentionally or unintentionally), or
take or fail to take any other action in respect of, any collateral or lien or
any part thereof;
(c) exercise in such manner and order as it elects in its sole discretion,
fail to exercise, waive, suspend, terminate or suffer expiration of, any of the
remedies or rights of such Beneficiary against the Company or any other Obligor
in respect of any Obligations or any security;
(d) release, add or settle with any Obligor in respect of the Obligor
Guarantee or the Obligations;
(e) accept partial payments on the Obligations and apply any and all
payments or recoveries from such Obligor to such of the Obligations as any
Beneficiary may elect in its sole discretion, whether or not such Obligations
are secured or guaranteed;
(f) refund at any time, at such Beneficiary's sole discretion, any payments
or recoveries received by such Beneficiary in respect of any Obligations; and
(g) otherwise deal with the Company or any other Obligor as such Beneficiary
may elect in its sole discretion.
SECTION 17.5 CERTAIN WAIVERS.
- -----------------------------
Each Guarantor waives:
(a) the right to require the Beneficiaries to proceed against the Company
or any other Obligor, to proceed against or exhaust any collateral or to pursue
any other remedy in any Beneficiary's power whatsoever and the right to have the
property of the Company or any other Obligor first applied to the discharge of
the Obligations;
(b) all rights and benefits under applicable law purporting to reduce a
Guarantor's obligations in proportion to the obligation of the principal or
providing that the obligation of a surety or Guarantor must neither be larger
nor in other respects more burdensome than that of the principal;
(c) the benefits of any statute of limitations affecting the Obligations or
any Guarantor's liability hereunder;
(d) any requirement of marshaling or any other principle of election of
remedies;
(e) any right to assert against any Beneficiary any defense (legal or
equitable), set-off, counterclaim and other right that any Guarantor may now or
any time hereafter have against the Company or any other Obligor;
(f) presentment, demand for payment or performance (including diligence in
making demands hereunder), notice of dishonor or nonperformance, protest,
acceptance and notice of acceptance of the Obligor Guarantee, and, except to the
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extent expressly required by the Guaranteed Securities or this Indenture, all
other notices of any kind, including (i) notice of any action taken or omitted
by the Beneficiaries in reliance hereon, (ii) notice of any default by the
Company or any other Obligor, (iii) notice that any portion of the Obligations
is due, (iv) notice of any action against the Company or any other Obligor, or
any enforcement or other action with respect to any collateral, or the assertion
of any right of any Beneficiary hereunder; and
(g) all defenses that at any time may be available to any Guarantor by
virtue of any valuation, stay, moratorium or other law now or hereafter in
effect.
SECTION 17.6 NO SUBROGATION; CERTAIN AGREEMENTS.
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(a) EACH GUARANTOR WAIVES ANY AND ALL RIGHTS OF SUBROGATION, INDEMNITY OR
REIMBURSEMENT, AND ANY AND ALL BENEFITS OF AND RIGHTS TO ENFORCE ANY POWER,
RIGHT OR REMEDY THAT ANY BENEFICIARY MAY NOW OR HEREAFTER HAVE IN RESPECT OF THE
OBLIGATIONS AGAINST THE COMPANY OR ANY OTHER OBLIGOR (OTHER THAN RIGHTS OF
CONTRIBUTION FROM OTHER GUARANTORS), AND ANY AND ALL OTHER RIGHTS AND CLAIMS (AS
DEFINED IN THE BANKRUPTCY CODE) ANY GUARANTOR MAY HAVE AGAINST THE COMPANY,
UNDER APPLICABLE LAW OR OTHERWISE, AT LAW OR IN EQUITY, BY REASON OF ANY PAYMENT
UNDER THE OBLIGOR GUARANTEE, UNLESS AND UNTIL THE OBLIGATIONS SHALL HAVE BEEN
PAID IN FULL.
(b) Each Guarantor assumes the responsibility for being and keeping itself
informed of the financial condition of each other Obligor and of all other
circumstances bearing upon the risk of nonpayment of the Obligations or the
Obligor Guarantee of any other Guarantor that diligent inquiry would reveal, and
agrees that the Beneficiaries shall have no duty to advise any Guarantor of
information regarding such condition or any such circumstances.
SECTION 17.7 BANKRUPTCY NO DISCHARGE.
- -------------------------------------
(a) Without limiting Section 17.3, the Obligor Guarantee shall not be
discharged or otherwise affected by any bankruptcy, reorganization or similar
proceeding commenced by or against the Company or any other Obligor, including
(i) any discharge of, or bar or stay against collecting, all or any part of the
Obligations in or as a result of any such proceeding, whether or not assented to
by any Beneficiary, (ii) any disallowance of all or any portion of any
Beneficiary's claim for repayment of the Obligations, (iii) any use of cash or
other collateral in any such proceeding, (iv) any agreement or stipulation as to
adequate protection in any such proceeding, (v) any failure by any Beneficiary
to file or enforce a claim against the Company or any other Obligor or its
estate in any bankruptcy or reorganization case, (vi) any amendment,
modification, stay or cure of any Beneficiary's rights that may occur in any
such proceeding, (vii) any election by any Beneficiary under Section 1112(b)(2)
of the Bankruptcy Code, or (viii) any borrowing or grant of a lien under Section
364 of the Bankruptcy Code. Each Guarantor understands and acknowledges that by
virtue of the Obligor Guarantee, it has specifically assumed any and all risks
of any such proceeding with respect to the Company and each other Obligor.
(b) Notwithstanding anything in this Article 17 to the contrary, any Event
of Default under the Guaranteed Securities or Section 5.1 of this Indenture
shall render all Obligations automatically due and payable
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for purposes of the Obligor Guarantee, without demand on the part of the Trustee
or any Holder.
(c) Notwithstanding anything to the contrary herein contained, the Obligor
Guarantee shall continue to be effective or be reinstated, as the case may be,
if at any time any payment, or any part thereof, of any or all of the
Obligations is rescinded, invalidated, declared to be fraudulent or preferential
or otherwise required to be restored or returned by any Beneficiary in
connection with any bankruptcy, reorganization or similar proceeding involving
the Company, any other Obligor or otherwise or if any Beneficiary elects to
return any such payment or proceeds or any part thereof in its sole discretion,
all as though such payment had not been made or such proceeds not been received.
SECTION 17.8 RIGHTS OF CONTRIBUTION.
- ------------------------------------
(a) In order to provide for just and equitable contribution among the
Guarantors in connection with the respective Obligor Guarantees, the Guarantors
have agreed among themselves that if any Guarantor satisfies some or all of the
Obligations of the Company guaranteed by it hereunder (a "Funding Guarantor"),
the Funding Guarantor shall be entitled to contribution from the other
Guarantors that have positive Maximum Net Worth (as defined below) for all
payments made by the Funding Guarantor in satisfying such Obligations, so that
each Guarantor that remains obligated under it Subsidiary Guarantee at the time
that a Funding Guarantor makes such payment (a "Remaining Guarantor") and has a
positive Maximum Net Worth shall bear a portion of such payment equal to the
percentage that such Remaining Guarantor's Maximum Net Worth bears to the
aggregate Maximum Net Worth of all Remaining Guarantors that have positive
Maximum Net Worth.
(b) For purposes of this Section 17.8, the following terms are defined as
set forth below:
"Net Worth" means, with respect to any Guarantor, the amount, as of any date
of calculation, by which the sum of such Person's assets (including subrogation,
indemnity, contribution, reimbursement and similar rights that such Guarantor
may have), determined on the basis of a "fair valuation" or their "fair salable
value" (whichever is the applicable test under Section 548 and other relevant
provisions of Bankruptcy Code, and the relevant state fraudulent conveyance or
transfer laws) is greater than the amount that will be required to pay all of
such Person's debts, in each case matured or unmatured, contingent or otherwise,
as of the date of calculation, but excluding liabilities arising under its
Obligor Guarantee and excluding, to the maximum extent permitted by applicable
law with the objective of avoiding rendering such Person insolvent, liabilities
subordinated to the Obligations under such Obligor Guarantees arising out of
loans or advances made to such Person by any other Person.
"Maximum Net Worth" means, with respect to any Guarantor, the greatest of
the Net Worths calculated as of the following dates: (A) the date of which the
Guarantor becomes a Guarantor hereunder, (B) the date on which such Guarantor
expressly reaffirms its Subsidiary Guarantee, (C) the date on which demand for
payment is made on such Guarantor hereunder, (D) the date on which payment is
made by such Guarantor hereunder or (E) the date on which any judgment, order or
decree is entered requiring such Guarantor to make payment hereunder or in
respect hereof.
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The meaning of the terms "fair valuation" and "fair salable value" and the
calculation of assets and liabilities shall be determined and made in accordance
with the relevant provisions of any Bankruptcy Code and applicable state
fraudulent conveyance or transfer laws.
SECTION 17.9 LIMITATION ON LIABILITY.
- --------------------------------------
If the obligations of any Guarantor hereunder otherwise would be subject to
avoidance under Section 548 of the Bankruptcy Code or any applicable state law
relating to fraudulent conveyances or fraudulent transfers, taking into
consideration such Guarantor's (i) rights of reimbursement and indemnity from
the Company with respect to amounts paid by such Guarantor and (ii) rights of
contribution from other Guarantors pursuant to Section 17.8, then such
obligations hereby are reduced to the largest amount that would make them not
subject to such avoidance. Any Person asserting that such Guarantor's
obligations are so avoidable shall have the burden (including the burden of
production and persuasion) of proving (a) that, without giving effect to this
paragraph, such Guarantor's obligations hereunder would be avoidable and (b) the
extent to which such obligations are reduced by operation of this paragraph.
SECTION 17.10 APPLICATION OF CERTAIN TERMS AND PROVISIONS TO THE GUARANTORS.
- -------------------------------------------------------------------------
(a) For purposes of any provision of this Indenture which provides for the
delivery by any Guarantor of an Officer's Certificate and/or an Opinion of
Counsel, the definitions of such terms in Section 1.01 shall apply to such
Subsidiary Guarantor as if references therein to the Company were references to
such Guarantor.
(b) Any request, direction, order or demand which by any provision of this
Indenture is to be made by any Guarantor, shall be sufficient if evidenced as
described in Section 18.2 as if references therein to the Company were
references to such Guarantor.
(c) Upon any demand, request or application by any Guarantor to the Trustee
to take any action under this Indenture, such Guarantor shall furnish to the
Trustee such certificates and opinions as are required in Section 1.02 hereof as
if all references therein to the Company were references to such Guarantor.
SECTION 17.11 EXECUTION AND DELIVERY OF GUARANTEE.
- --------------------------------------------------
Each Guarantor shall be deemed to have signed on each Debt Security issued
hereunder any required notation of guarantee to the same extent as if the
signature of such Guarantor appeared on such Debt Security. The delivery of any
Debt Security by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of the Obligor Guarantee set forth in Section 17.2 on
behalf of each Guarantor. The notation of a guarantee set forth on any Debt
Security shall be null and void and of no further effect with respect to the
Obligor Guarantee of any Guarantor which, pursuant to Section 17.12 or Section
17.13, is released from such Guarantee.
SECTION 17.12 GUARANTOR MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
- ---------------------------------------------------------------
(a) Nothing contained in this Indenture or in any of the Debt Securities
shall prevent any consolidation or merger of a Guarantor with
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or into the Company or any other Guarantor. Upon any such consolidation or
merger, the Obligor Guarantee (as set forth in Section 17.2) of the Guarantor
which is not the survivor of the merger or consolidation, shall be released and
shall no longer have any force or effect.
(b) Nothing contained in this Indenture shall prevent any sale or
conveyance of assets of any Guarantor (whether or not constituting all or
substantially all of the assets of such Guarantor) to any Person, provided that
the Company shall comply with any applicable terms of this Indenture, and
provided further that, subject to Section 17.13, in the event that all of the
assets of a Guarantor are sold or conveyed, the Obligor Guarantee of such
Guarantor (as set forth in Section 17.2) shall be released and shall no longer
have any force or effect.
(c) Except as provided in Section 17.12(a) or Section 17.13, each Guarantor
shall not, directly or indirectly, consolidate with or merge with or into
another Person, unless (i) either (a) the Guarantor is the continuing entity or
(b) the resulting or surviving entity is a corporation organized under the laws
of the United States, any state thereof or the District of Columbia and
expressly assumes by supplemental indenture all of the obligations of the
Guarantor in connection with the Debt Securities and this Indenture; (ii) no
Default or Event of Default would occur as a consequence of (after giving
effect, on a pro forma basis, to) such transaction; and (iii) the Guarantor has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation or merger and if a supplemental indenture
is required, such supplemental indenture comply with this Indenture and that all
conditions precedent herein relating to such transaction have been satisfied.
(d) Upon any consolidation or merger of a Guarantor in accordance with
Section 17.12, the successor corporation formed by such consolidation or into
which the Guarantor is merger shall succeed to, and be substituted for, and may
exercise every right and power of, the Guarantor under this Indenture with the
same effect as if such successor corporation had been named herein a the
Guarantor, and when a successor corporation duly assumes all of the obligations
of the Guarantor pursuant hereto and pursuant to the Debt Securities, the
Guarantor shall be released from such obligations.
SECTION 17.13 RELEASE OF GUARANTORS.
- ------------------------------------
(a) Without further notice or action being required by any Person, but
subject to Section 10.1, any Guarantor, and each Subsidiary of such Guarantor
that is also a Guarantor, shall be fully and conditionally released and
discharged from all obligations under its Obligor Guarantee and this Indenture,
upon (i) the sale or other disposition of all of the assets or properties of
such Guarantor, or 50% or more of the equity interests of any such Guarantor or
Persons other than the Company and their Subsidiaries or (ii) the consolidation
or merger of any such Guarantor with any Person other than the Company or a
Subsidiary of the Company, if, as a result of such consolidation or merger,
Persons other than the Company and their Subsidiaries beneficially own more than
50% of the capital stock of such Guarantor, provided, that, in either such case,
the proceeds of any such sale, disposition, merger or consolidation are applied
in accordance with this Indenture; or (iii) a defeasance as provided in Article
15 hereof.
(b) The releases and discharges set forth in Section 17.13(a) shall be
effective (i) in the case of releases and discharges effected pursuant
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to clause (i) or (ii) of Section 17.13(a) by virtue of a sale, disposition,
consolidation or merger, on the date of consummation thereof and (ii) in the
case of releases and discharges effected pursuant to clause (iii) of Section
17.13(a), upon the date of defeasance. At the written request of the Company,
the Trustee shall promptly execute and deliver appropriate instruments in forms
reasonably acceptable to the Company evidencing and further implementing any
releases and discharges pursuant to the foregoing provisions. If the Company
desires the instruments evidencing or implementing any releases or discharges to
be executed prior to the effectiveness of such releases and discharges as set
forth above, necessary to cause the effectiveness of such releases and
discharges, as specified in the first sentence of this Section 17.13.
(c) Notwithstanding the foregoing provisions of this Article 17, (i) any
Guarantor whose Obligor Guarantee would otherwise be released pursuant to the
provisions of this Section 17.13 may elect, by written notice to the Trustee, to
maintain such Obligor Guarantee in effect notwithstanding the event or events
that otherwise would cause the release of such Obligor Guarantee (which election
to maintain such guarantee in effect may be conditional or for a limited period
of time), and (ii) any Subsidiary of the Company which is not a Guarantor may
elect, by written notice to the Trustee, to become a Guarantor (which election
may be conditional or for a limited period of time).
SECTION 17.14 CERTAIN BANKRUPTCY EVENTS.
- ----------------------------------------
Each Guarantor hereby covenants and agrees, to the fullest extent that it
may do so under applicable law, that in the event of the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Company, such Guarantor shall
not file (or join in any filing of), or otherwise seek to participate in the
filing of, any motion or request seeking to stay or to prohibit (even
temporarily) execution on the Obligor Guarantee and hereby waives and agrees not
to take the benefit of any such stay of execution.
ARTICLE 18
MISCELLANEOUS
Section 18.1 NOTICES, ETC., TO TRUSTEE AND COMPANY.
- ---------------------------------------------------
Any Act of holders or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with:
(a) the Trustee by any holder or by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing to or with the Trustee at its Corporate
Trust Office, Attention: Corporate Trust Department, or
(b) the Company by the Trustee or by any holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid or airmail postage prepaid if
sent from outside the United States, to the Company addressed to it at the
address of its principal office specified in the first paragraph of this
instrument, to the attention of its
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Treasurer, or at any other address previously furnished in writing to the
Trustee by the Company.
Any such Act or other document shall be in the English language, except that
any published notice may be in an official language of the country of
publication.
Section 18.2 NOTICE TO HOLDERS; WAIVER.
- ---------------------------------------
When this Indenture provides for notice to holders of any event, such notice
shall be sufficiently given to holders (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to such holders
as their names and addresses appear in the Security Register, within the time
prescribed; provided, however, that, in any case, any notice to holders of
Floating Rate Securities regarding the determination of a periodic rate of
interest, if such notice is required pursuant to Section 3.1, shall be
sufficiently given if given in the manner specified pursuant to Section 3.1.
In the event of suspension of regular mail service or by reason of any other
cause it shall be impracticable to give notice by mail, such notification as
shall be given with the approval of the Trustee shall constitute sufficient
notice for every purpose hereunder.
In the event of suspension of publication of any Authorized Newspapers or by
reason of any other cause it shall be impracticable to give notice by
publication, such notification as shall be given with the approval of the
Trustee shall constitute sufficient notice for every purpose hereunder.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance on such waiver. In any case where notice to holders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular holder shall affect the sufficiency of such notice with
respect to other holders, and any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given. In any case
where notice to holders is given by publication, any defect in any notice so
published as to any particular holder shall not affect the sufficiency of such
notice with respect to other holders, and any notice which is published in the
manner herein provided shall be conclusively presumed to have been duly given.
Section 18.3 CONFLICT WITH TRUST INDENTURE ACT.
- -----------------------------------------------
If any provision hereof limits, qualifies or conflicts with the duties
imposed on any person by the provisions of Sections 310 to 317, inclusive, of
the Trust Indenture Act, such imposed duties shall control.
Section 18.4 COUNTERPARTS; EFFECT OF HEADINGS AND TABLE OF CONTENTS.
- --------------------------------------------------------------------
This Indenture may be executed in any number of counterparts, each of which
when executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same
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Indenture. The Article and Section headings herein and in the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 18.5 SUCCESSORS AND ASSIGNS.
- ------------------------------------
All covenants and agreements in this Indenture by the parties hereto shall
bind their respective successors and assigns and inure to the benefit of their
permitted successors and assigns, whether so expressed or not.
Section 18.6 SEPARABILITY CLAUSE.
- ---------------------------------
In case any provision in this Indenture or in the Debt Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 18.7 BENEFITS OF INDENTURE.
- -----------------------------------
Nothing in this Indenture or in the Debt Securities, express or implied,
shall give to any Person, other than the parties hereto, any Security Registrar,
any Paying Agent and their successors hereunder, and the holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
Section 18.8 GOVERNING LAW.
- ---------------------------
This Indenture and the Debt Securities shall be deemed to be contracts made
and to be performed entirely in the State of California, and for all purposes
shall be governed by and construed in accordance with the internal laws of said
State without regard to the conflicts of law rules of said State.
Section 18.9 LEGAL HOLIDAYS.
- ----------------------------
Unless otherwise specified pursuant to Section 3.1 or in any Debt Security,
in any case where any Interest Payment Date, Redemption Date or Stated Maturity
of any Debt Security of any series shall not be a Business Day at any Place of
Payment for the Debt Securities of that series, then (notwithstanding any other
provision of this Indenture or of the Debt Securities) payment of principal (and
premium, if any) or interest need not be made at such Place of Payment on such
date, but may be made on the next succeeding Business Day at such Place of
Payment with the same force and effect as if made on the Interest Payment Date,
Redemption Date or at the Stated Maturity, and no interest shall accrue on the
amount so payable for the period from and after such Interest Payment Date,
Redemption Date or Stated Maturity, as the case may be, to such Business Day if
such payment is made or duly provided for on such Business Day.
Section 18.10 NO RECOURSE AGAINST OTHERS.
- -----------------------------------------
No direct or indirect incorporator, employee, stockholder, director or
officer, as such, past, present or future of the Company or
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any successor corporation or any of the Company's Affiliates, shall have any
personal liability in respect of the obligations of the Company under the Debt
Securities or this Indenture, either directly or through the Company, by reason
of his, her or its status as such incorporator, stockholder, employee, director
or officer. Each holder by accepting a Debt Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Debt Securities.
Section 18.11 GAMING LAWS.
- --------------------------
If the Company becomes the holding company of a New Jersey casino licensee,
this Indenture and the Debt Securities will be subject to the Casino Control Act
of the State of New Jersey and the rules and regulations thereunder. In
addition, the Nevada Gaming Commission may at any time, in its discretion,
require the holder of any Debt Securities of the Company to file an application,
be investigated and be found suitable to own such Debt Securities.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
MGM GRAND, INC.
By:
---------------------------
Name:
---------------------------
Title:
-------------------------
[SEAL]
Attest:
By:
------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
[NAME OF TRUSTEE], as Trustee
By:
------------------------------------------------------
Name:
-----------------------------------------------------
Title:
----------------------------------------------------
[SEAL]
Attest:
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
73
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EXHIBIT A
[FORM OF REDEEMABLE OR NONREDEEMABLE DEBT SECURITY]
[FACE OF DEBT SECURITY]
[THIS DEBT SECURITY IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS DEBT SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE
DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY DEBT SECURITY
AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR
OR IN LIEU OF, THIS DEBT SECURITY SHALL BE A GLOBAL NOTE SUBJECT TO THE
FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES.]
[IF THIS DEBT SECURITY IS AN ORIGINAL ISSUE DISCOUNT DEBT SECURITY,
INSERT--FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE UNITED STATES INTERNAL
REVENUE CODE, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THIS DEBT SECURITY IS
_____% OF ITS PRINCIPAL AMOUNT, THE ISSUE DATE IS __________, 20__ [AND] THE
YIELD TO MATURITY IS ____ %. THE METHOD USED TO DETERMINE THE AMOUNT OF ORIGINAL
ISSUE DISCOUNT APPLICABLE TO THE SHORT ACCRUAL PERIOD OF __________, 20__ TO
________, 20__, IS ____% OF THE PRINCIPAL AMOUNT OF THIS DEBT SECURITY.]
MGM GRAND, INC. [DESIGNATION OF SERIES]
No.__________ $__________
MGM GRAND, INC., a Delaware corporation (herein referred to as the
"Company," which term includes any successor corporations under the Indenture
referred to on the reverse hereof), for value received, hereby promises to pay
to _____________________ or registered assigns the principal sum of
_____________________ Dollars on ___________ (the "Stated Maturity Date") [OR
INSERT DATE FIXED FOR EARLIER REDEMPTION (the "Redemption Date" and, together
with the Stated Maturity Date with respect to principal repayable on such date,
the "Maturity Date")].
[IF THE DEBT SECURITY IS TO BEAR INTEREST PRIOR TO MATURITY, INSERT--and to
pay interest thereon from _____________________ or from the most recent interest
payment date to which interest has been paid or duly provided for, semi-annually
on _________________ and ________________ in each year (each, an "Interest
Payment Date"), commencing _________________, at the rate of _____% per annum,
until the principal hereof is paid or duly provided for. The interest so
payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in such Indenture, be paid to the
Holder in whose name this Debt Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the _______________ or _______________ (whether or not
a Business Day, as defined below), as the case may be, next preceding such
Interest Payment Date [at the office or agency of the Company maintained for
such purpose; PROVIDED, HOWEVER, that such interest may be paid, at the
Company's option, by mailing a check to such Holder at his or her registered
address or by transfer of funds to an account maintained by such Holder within
the United States]. Any such interest not so punctually paid or duly provided
for shall forthwith cease to be payable to the Holder on such Regular Record
Date, and may be paid to the Holder in whose name this Debt Security (or one or
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more Predecessor Debt Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Debt Securities of this
series not less than 15 days prior to such Special Record Date, or may be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Debt Securities of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture. Interest will be computed on the basis of a
360-day year of twelve 30-day months.]
[IF THE DEBT SECURITY IS NOT TO BEAR INTEREST PRIOR TO MATURITY, INSERT-- The
principal of this Debt Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at the
[Stated] Maturity Date and in such case the overdue principal of this Debt
Security shall bear interest at the rate of _________% per annum (to the extent
that the payment of such interest shall be legally enforceable), which shall
accrue from the date of such default in payment to the date payment of such
principal has been made or duly provided for. Interest on any overdue principal
shall be payable on demand. Any such interest on any overdue principal that is
not so paid on demand shall bear interest at the rate of _____% per annum (to
the extent that the payment of such interest shall be legally enforceable),
which shall accrue from the date of such demand for payment to the date payment
of such interest has been made or duly provided for, and such interest shall
also be payable on demand.]
The principal of this Debt Security payable on the [Stated] Maturity Date [or
the principal of, premium, if any, and, if the Redemption Date is not an
Interest Payment Date, interest on this Debt Security payable on the Redemption
Date] will be paid against presentation of this Debt Security at the office or
agency of the Company maintained for that purpose in ____________, in such coin
or currency of the United States as at the time of payment is legal tender for
the payment of public and private debts.
Interest payable on this Debt Security on any Interest Payment Date and on the
[Stated] Maturity Date [or Redemption Date, as the case may be,] will include
interest accrued from and including the next preceding Interest Payment Date in
respect of which interest has been paid or duly provided for (or from and
including ____________, if no interest has been paid on this Debt Security) to
but excluding such Interest Payment Date or the [Stated] Maturity Date [or
Redemption Date, as the case may be]. If any Interest Payment Date or the
[Stated] Maturity Date [or Redemption Date] falls on a day that is not a
Business Day, principal, premium, if any, and/or interest payable with respect
to such Interest Payment Date or [Stated] Maturity Date [or Redemption Date, as
the case may be,] will be paid on the next succeeding Business Day with the same
force and effect as if it were paid on the date such payment was due, and no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date or [Stated] Maturity Date [or Redemption Date, as the
case may be]. "Business Day" means any day, other than a Saturday or Sunday, on
which banking institutions or trust companies in [__________] are authorized to
close.
[IF THIS DEBT SECURITY IS A GLOBAL DEBT SECURITY, INSERT--All payments of
principal, premium, if any, and interest in respect of this Debt Security will
be made by the Company in immediately available funds.]
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Reference is hereby made to the further provisions of this Debt Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the Certificate of Authentication hereon has been executed by the
Trustee by manual signature of one of its authorized signatories, this Debt
Security shall not be entitled to any benefit under the Indenture, or be valid
or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its [facsimile] corporate seal.
Dated _________________ MGM GRAND, INC.
By:
--------------------------
Name:
Title:
Attest:
By:
--------------------------
Name:
Title:
90
<PAGE>
[Reverse of Debt Security]
MGM GRAND, INC.
This Debt Security is one of a duly authorized issue of securities of the
Company, issued and to be issued in one or more series under an Indenture, dated
as of ___________, 2000 (herein called the "Indenture") between the Company and
__________________, as Trustee (herein called the "Trustee," which term includes
any successor trustee under the Indenture with respect to the series of which
this Debt Security is a part), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Debt Securities, and of the terms upon which
the Debt Securities are, and are to be, authenticated and delivered. This Debt
Security is one of the duly authorized series of Debt Securities designated on
the face hereof (collectively, the "Debt Securities"), [IF APPLICABLE, INSERT--
and the aggregate principal amount of the securities to be issued under such
series is limited to $________ (except for Debt Securities authenticated and
delivered upon transfer of, or in exchange for, or in lieu of other Debt
Securities).] All terms used in this Debt Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
If an Event of Default shall occur and be continuing, the principal of the
Debt Securities of this series may be declared due and payable in the manner and
with the effect provided in the Indenture.
[IF APPLICABLE, INSERT--The Debt Securities may not be redeemed prior to the
[Stated] Maturity Date.]
The rights of each Holder and any beneficial owner of the Debt Securities are
subject to the Gaming Laws and requirements of the Gaming Authorities. Each
holder and beneficial owner, by accepting or otherwise acquiring an interest in
the Debt Securities, shall be deemed to have agreed that if the Gaming Authority
of any jurisdiction in which the Company or any of its subsidiaries conducts or
proposes to conduct gaming requires that a Person who is a holder or beneficial
owner must be licensed, qualified or found suitable under the applicable Gaming
Laws, such holder or beneficial owner shall apply for a license, qualification
or a finding of suitability within the required time period. If such Person
fails to apply or become licensed or qualified or is found unsuitable, then the
Company shall have the right, at its option, notwithstanding any other provision
of this Indenture (i) to require such Person to dispose of its Debt Securities
or beneficial interest therein within 30 days of receipt of notice of the
Company's election or such earlier date as may be requested or prescribed by
such Gaming Authority or (ii) to redeem such Debt Securities at a redemption
price equal to 100% of the principal amount thereof, plus accrued and unpaid
interest to the earlier of the redemption date and the date of the finding of
unsuitability, which may be less than 30 days following the notice of redemption
if so requested or prescribed by the Gaming Authority, or such lesser amount as
may be required by applicable law or by order of any Gaming Authority. The
Company shall notify the Trustee in writing of any such redemption as soon as
practicable. The Company shall not be responsible for any costs or expenses any
such holder or beneficial owner may incur in connection with its application for
a license, qualification or a finding of suitability. Notwithstanding any other
provision of this Indenture, immediately upon the imposition of a requirement to
dispose of Debt Securities by a Gaming Authority, such Person shall, to the
extent required by applicable Gaming Law, have no further right (i) to exercise,
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directly or indirectly, through any trustee, nominee or any other person or
entity, any right conferred by the Debt Securities or (ii) to receive any
interest, dividends or any other distributions or payments with respect to the
Debt Securities or any remuneration in any form with respect to the Debt
Securities from the Company or the Trustee, except the redemption price.
[IF APPLICABLE, INSERT--The Debt Securities are subject to redemption [(a) [IF
APPLICABLE, INSERT--on ______________ in any year commencing with the year ____
and ending with the year ____ through operation of the sinking fund for this
series at a Redemption Price equal to 100% of the principal amount and (b)] [IF
APPLICABLE, INSERT--at any time [on or after _______________], as a whole or in
part, at the election of the Company, at the following Redemption Prices
(expressed as percentages of the principal amount): If redeemed on or before
___________, ____% and if redeemed during the 12-month period beginning
______________ of the years indicated, at the Redemption Prices indicated below.
Year Redemption Price Year Redemption Price
---- ---------------- ---- ----------------
and thereafter at a Redemption Price equal to ____% of the principal amount,
together, in the case of any such redemption [IF APPLICABLE, INSERT--(whether
through operation of the sinking fund or otherwise)], with accrued interest to
the Redemption Date; PROVIDED, HOWEVER, that installments of interest on this
Debt Security whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holder of this Debt Security, or one or more Predecessor Debt
Securities, of record at the close of business on the relevant Record Dates
referred to on the face hereof, all as provided in the Indenture.]
[IF APPLICABLE, INSERT--The Debt Securities are subject to redemption (a) on
____________ in any year commencing with the year ____ and ending with the year
through operation of the sinking fund for this series at the Redemption Prices
for redemption through operation of the sinking fund (expressed as percentages
of the principal amount) set forth in the table below and (b) at any time on or
after __________], as a whole or in part, at the election of the Company, at the
Redemption Prices for redemption otherwise than through operation of the sinking
fund (expressed as percentages of the principal amount) set forth in the table
below:
If redeemed during the 12-month period beginning of the years indicated,
Redemption Price for Redemption
Otherwise Than Through Redemption Price for Redemption
Operation of the Sinking Fund Through Operation of Sinking Fund
Year
- ----------------------------- ---------------------------------
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and thereafter at a Redemption Price equal to ___% of the principal amount,
together, in the case of any such redemption (whether through operation of the
sinking fund or otherwise), with accrued interest to the Redemption Date;
PROVIDED, HOWEVER, that installments of interest on this Debt Security whose
Stated Maturity is on or prior to such Redemption Date will be payable to the
Holder of this Debt Security, or one or more Predecessor Debt Securities, of
record at the close of business on the relevant record dates referred to on the
face hereof, all as provided in the Indenture.]
[IF APPLICABLE, INSERT--Notwithstanding the foregoing, the Company may not,
prior to __________ redeem any Debt Securities as contemplated by [clause (b)
of] the preceding paragraph as a part of, or in anticipation of, any refunding
operation by the application, directly or indirectly, of money borrowed having
an interest cost to the Company (calculated in accordance with generally
accepted financial practice) of less than ____% per annum.]
[IF APPLICABLE, INSERT--The sinking fund for the Debt Securities provides for
the redemption on __________ in each year, beginning with the year ____ and
ending with the year ____, of [not less than] $___] [("mandatory sinking fund")
and not more than $_______] aggregate principal amount of the Debt Securities.
[The Debt Securities acquired or redeemed by the Company otherwise than through
[mandatory] sinking fund payments may be credited against subsequent [mandatory]
sinking fund payments otherwise required to be made in the [DESCRIBE ORDER]
order in which they become due.]]
Notice of redemption will be given by mail to Holders of Debt Securities, not
less than 30 nor more than 60 days prior to the Redemption Date, all as provided
in the Indenture.
In the event of redemption of the Debt Security in part only, a new Debt
Security or Debt Securities for the unredeemed portion hereof shall be issued in
the name of the Holder hereof upon the cancellation hereof.
[IF APPLICABLE, INSERT CONVERSION PROVISIONS SET FORTH IN ANY BOARD
RESOLUTION OR INDENTURE SUPPLEMENTAL TO THE INDENTURE.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Debt Securities under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of
not less than at least a majority of the aggregate principal amount of all Debt
Securities issued under the indenture at the time Outstanding and affected
thereby. The Indenture also contains provisions permitting the Holders of not
less than at least a majority of the aggregate principal amount of the
Outstanding Debt Securities, on behalf of the Holders of all such Debt
Securities, to waive compliance by the Company with certain provisions of the
Indenture. Furthermore, provisions in the Indenture permit the Holders of not
less than at least a majority of the aggregate principal amount, in certain
instances, of the Outstanding Debt Securities of any series to waive, on behalf
of all of the Holders of Debt Securities of such series, certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Debt Security shall be conclusive and binding upon such Holder
and upon all future Holders of this Debt Security and other Debt Securities
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon this
Debt Security.
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No reference herein to the Indenture and no provision of this Debt Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Debt Security at the times, rates and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein [and
herein] set forth, the transfer of this Debt Security is registrable in the
Security Register of the Company upon surrender of this security for
registration of transfer at the office or agency of the Company in any place
where the principal of (and premium, if any) and interest on this Debt Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or by his attorney duly authorized in writing,
and thereupon one or more new Debt Securities, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
As provided in the Indenture and subject to certain limitations therein [and
herein] set forth, this Debt Security is exchangeable for a like aggregate
principal amount of Debt Securities of different authorized denominations but
otherwise having the same terms and conditions, as requested by the Holder
hereof surrendering the same.
The Debt Securities of this series are issuable only in registered form
[without coupons] in denominations of $________ and any integral multiple
thereof. No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. Prior to
due presentment of this Debt Security for registration of transfer, the Company,
the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Debt Security is registered as the owner hereof for all
purposes, whether or not this Debt Security be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the contrary.
No recourse shall be had for the payment of the principal of or premium, if
any, or the interest on this Debt Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture or any
indenture supplemental thereto, against any past, present or future
incorporator, stockholder, employee, officer or director, as such, of the
Company or of any successor or Affiliate of the Company, either directly or
through the Company or any successor, whether by virtue of any constitution,
statute or rule of law or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.
[IF APPLICABLE, INSERT--The obligations of the Company under the Indenture
shall be guaranteed as set forth in the Indenture.]
[IF APPLICABLE, INSERT--The obligations of the Company under the Indenture
shall be secured as set forth in the Indenture.]
The Indenture and the Debt Securities shall be governed by and construed in
accordance with the laws of the State of California applicable to agreements
made and to be performed entirely in such State.
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TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the series of Debt Securities issued under the within-mentioned
Indenture.
[NAME OF TRUSTEE], as Trustee
By
-------------------------------
Authorized Signatory
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Exhibit 12
Ratio of Earnings to Fixed Charges*
----------------------------------
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------------------------------------
1999
1995 1996 1997 1998 1999 Pro forma(1)
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Pre-tax Income before extraordinary items
and cumulative effect of accounting change $ 46,565 $ 99,151 $180,301 $109,528 $150,153 $228,617
Fixed Charges (Gross Interest, Debt Discount,
Issuance Costs, and Cap. Int.) 63,646 40,801 9,044 40,158 76,200 491,079
Interest Expense, Unconsolidated Affiliates 380 6,975 9,891 8,376 1,058 6,949
-----------------------------------------------------------------------
64,026 47,776 18,935 48,534 77,258 498,028
Capitalized Interest (4,317) (7,023) (7,802) (15,546) (16,300) (114,134)
Construction Capitalized Interest,
Unconsolidated Affiliates (380) (6,975) - - - -
-----------------------------------------------------------------------
(4,697) (13,998) (7,802) (15,546) (16,300) (114,134)
-----------------------------------------------------------------------
Total Earnings 105,894 132,929 191,434 142,516 211,111 612,511
-----------------------------------------------------------------------
----------------------------------------------------------------------
Ratio of Earnings to Fixed Charges 1.65 2.78 10.11 2.94 2.73 1.23
=======================================================================
</TABLE>
* The calculation of "Total Earnings" does not include the amortization of
interest previously capitalized due to immateriality.
The calculation of "Fixed Charges" does not include the interest factor of
rental expense due to immateriality.
(1) Pro forma to give effect to the acquisition of Mirage Resorts, Incorporated.
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our reports dated January 20, 2000
(except with respect to the matter discussed in Note 11, as to which the date is
March 1, 2000), incorporated by reference in MGM Grand, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1999, and to all references to our
Firm included in or made a part of this Registration Statement.
ARTHUR ANDERSEN LLP
Las Vegas, Nevada
March 23, 2000
<PAGE>
Exhibit 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated January 24, 2000,
included in Mirage Resorts, Incorporated's Annual Report on Form 10-K for the
year ended December 31, 1999 and to all references to our Firm included in or
made a part of this Registration Statement.
ARTHUR ANDERSEN LLP
Las Vegas, Nevada
March 23, 2000
