Exhibit 1
Mirage Resorts, Incorporated
Common Stock, $.004 par value per share
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Underwriting Agreement
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May 6, 1999
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
From time to time Mirage Resorts, Incorporated, a Nevada corporation (the
"Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain shares of Common Stock, $.004 par value (the
"Shares"), specified in Schedule II to such Pricing Agreement (with respect to
such Pricing Agreement, the "Firm Shares"). If specified in such Pricing
Agreement, the Company may grant to the Underwriters the right to purchase at
their election an additional number of shares, specified in such Pricing
Agreement as provided in Section 3 hereof (the "Optional Shares"). The Firm
Shares and the Optional Shares, if any, which the Underwriters elect to purchase
pursuant to Section 3 hereof are herein collectively called the "Designated
Shares".
The terms and rights of any particular issuance of Designated Shares shall
be as specified in the Pricing Agreement relating thereto.
1. Particular sales of Designated Shares may be made from time to time to
the Underwriters of such Shares, for whom the firms designated as
representatives of the Underwriters of such Shares in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being designated
as their representative. This Underwriting Agreement shall not be construed as
an obligation of the Company to sell any of the Shares or as an obligation of
any of the Underwriters to purchase any of the Shares. The obligation of the
Company to issue and sell any of the Shares and the obligation of any of the
Underwriters to purchase any of the Shares shall be evidenced by the Pricing
Agreement with respect to the Designated Shares specified therein. Each Pricing
Agreement shall specify the aggregate number of the Firm Shares, the maximum
number of Optional Shares, if any, the initial
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public offering price of such Firm and Optional Shares or the manner of
determining such price, the purchase price to the Underwriters of such
Designated Shares, the names of the Underwriters of such Designated Shares, the
names of the Representatives of such Underwriters, the number of such Designated
Shares to be purchased by each Underwriter and the commission, if any, payable
to the Underwriters with respect thereto and shall set forth the date, time and
manner of delivery of such Firm and Optional Shares, if any, and payment
therefor. The Pricing Agreement shall also specify (to the extent not set forth
in the registration statement and prospectus with respect thereto) the terms of
such Designated Shares. A Pricing Agreement shall be in the form of an executed
writing (which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designed to
produce a written record of communications transmitted. The obligations of the
Underwriters under this Agreement and each Pricing Agreement shall be several
and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-39029) (the
"Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in
the form heretofore delivered or to be delivered to the Representatives
and, excluding exhibits to such registration statement, but including all
documents incorporated by reference in the prospectus contained therein, to
the Representatives for each of the other Underwriters, have been declared
effective by the Commission in such form; other than a registration
statement, if any, increasing the size of the offering (a "Rule 462(b)
Registration Statement"), filed pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the "Act"), which became or will become
effective upon filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed or transmitted for filing with the Commission (other
than prospectuses filed pursuant to Rule 424(b) of the rules and
regulations of the Commission under the Act, each in the form heretofore
delivered to the Representatives, and periodic reports on Forms 10-K, 10-Q
and 8-K, copies of which have heretofore been delivered to the
Representatives); and no stop order suspending the effectiveness of the
Initial Registration Statement, any post-effective amendment thereto or the
Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or, to the best of the
Company's knowledge, threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) under the Act is hereinafter called a
"Preliminary Prospectus"; the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, including all
exhibits thereto and the documents incorporated by reference in the
prospectus contained in the registration statement at the time such part of
the Initial Registration Statement became effective, each as amended at the
time such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any became or
hereafter becomes effective, are hereinafter collectively called the
"Registration Statement"; the prospectus relating to the Shares, in the
form in which it has most recently been filed, or transmitted for filing,
with the Commission on or prior to the date of this Agreement, being
hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
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include the documents incorporated by reference therein pursuant to the
applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus, as
the case may be; any reference to any amendment to the Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or Section 15(d) of the Exchange
Act after the effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement; and any reference
to the Prospectus as amended or supplemented shall be deemed to refer to
the Prospectus as amended or supplemented in relation to the applicable
Designated Shares in the form in which it is filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a)
hereof, including any documents incorporated by reference therein as of the
date of such filing);
(b) No order preventing or suspending the use of any Preliminary
Prospectus, if any, has been issued by the Commission, and each Preliminary
Prospectus, if any, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of
Designated Shares through the Representatives expressly for use in the
Preliminary Prospectus relating to such Shares;
(c) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Shares through the Representatives expressly for
use in the Prospectus as amended or supplemented relating to such Shares;
(d) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the
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Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Shares through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to
such Shares;
(e) Neither the Company nor any of its Subsidiaries (as defined below)
has sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any change in the authorized capital stock
of the Company, or in the long-term debt of the Company or any of its
Subsidiaries (except as noted in note (b) to the Capitalization table in
the Prospectus) in excess of $155 million, or any material adverse change,
or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
Subsidiaries considered as one enterprise, otherwise than as set forth or
contemplated in the Prospectus;
(f) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Nevada, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus;
(g) The Company has authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable;
(h) Other than subsidiaries which, in the aggregate, would not be
considered a "significant subsidiary" for purposes of Rule 1-02 under
Regulation S-X, the Company does not own a majority interest in, or
control, directly or indirectly, any corporation, association or other
entity other than the Subsidiaries listed in Exhibit 21 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1998
(collectively, such existing subsidiaries, the "Subsidiaries" ); each of
the Company and THE MIRAGE CASINO-HOTEL, MH, INC., GNS FINANCE CORP., GNLV,
CORP., GNL, CORP., MAC, CORP., Treasure Island Corp., Bellagio, Beau Rivage
Resorts, Inc., Golden Nugget Aviation Corp., LV Concrete Corp., Atlandia
Design and Furnishings, Inc., Boardwalk Casino, Inc. and MRGS Corp.
(collectively, the "Significant Subsidiaries"), has been duly incorporated
and is validly existing as a corporation in good standing under the laws of
its state of incorporation with full power and authority (corporate and
other) to own or lease its properties and conduct its business as described
in the Prospectus; the Company or a wholly owned Subsidiary owns all of the
outstanding capital stock of the Subsidiaries free and clear of all claims,
liens, charges and encumbrances; each of the Company and its Significant
Subsidiaries is duly qualified to do business and in good standing as a
foreign corporation in each jurisdiction in which the
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ownership or leasing of its respective properties or the conduct of its
respective business requires such qualification, except for jurisdictions
in which the failure to so qualify would not have a material adverse effect
upon the business or financial position of the Company or such Significant
Subsidiary; and no proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing, or seeking to revoke, limit or curtail,
such power and authority or qualification; and none of the Subsidiaries not
named as "Significant Subsidiaries" owns or leases any operating properties
and the assets owned or leased by such Subsidiaries, in the aggregate, are
immaterial to the Company and its Subsidiaries considered as one
enterprise;
(i) The Shares have been duly and validly authorized, and, when the
Firm Shares are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Shares and, in the case
of any Optional Shares, pursuant to Over-allotment Options (as defined in
Section 3 hereof) with respect to such Shares, such Designated Shares will
be duly and validly issued and fully paid and non-assessable; the Shares
conform to the description thereof contained in the Registration Statement
and the Designated Shares will conform to the description thereof contained
in the Prospectus as amended or supplemented with respect to such
Designated Shares;
(j) The issue and sale of the Shares and the compliance by the Company
with all of the provisions of this Agreement, any Pricing Agreement and
each Over-allotment Option, if any, and the consummation of the
transactions herein and therein contemplated, will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company is a party
or by which the Company is bound or to which any of the property or assets
of the Company is subject, nor will such action result in any violation of
the provisions of the Articles of Incorporation or By-laws of the Company
or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of
its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body (including, without limitation, the Nevada Gaming
Commission, the Nevada State Gaming Control Board, the City of Las Vegas
and the ▇▇▇▇▇ County Liquor and Gaming Licensing Board (collectively, the
"Nevada Gaming Authorities")) is required for the issue and sale of the
Shares or the consummation by the Company of the transactions contemplated
by this Agreement or any Pricing Agreement or any Over-allotment Option,
except such as have been, or will have been prior to the Time of Delivery
(as defined in Section 4 hereof), obtained under the Act and such consents,
approvals, authorizations, registrations or qualifications as may be
required under the Nevada Gaming Control Act, the Mississippi Gaming
Control Act and the respective regulations promulgated thereunder (the
"Gaming Laws") (which have been obtained and are in full force and effect),
the state securities and Blue Sky laws applicable to the public offering of
the Shares by the Underwriters and the clearance of such offering with the
National Association of Securities Dealers, Inc. (the "NASD");
(k) The statements incorporated by reference in the Prospectus from the
Company's registration statement on Form 8-A filed under Section 12 of the
Exchange Act on July 23, 1980, as amended by Amendment No. 4 thereto filed
on June 19, 1996, insofar as they purport to constitute a summary of the
terms of the Shares, and the statements set forth in the Prospectus under
the captions "Plan of Distribution" and "Gaming Regulation" (including any
information incorporated by reference with respect thereto), insofar as
they purport to describe
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the provisions of the laws and documents referred to therein, are accurate,
complete and fair in all material respects;
(l) Neither the Company nor any of its Subsidiaries is in violation of
its Articles or Certificate of Incorporation or By-laws or in default in
any material respect in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties
may be bound;
(m) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
Subsidiaries is a party or of which any property of the Company or any of
its Subsidiaries is the subject which, if determined adversely to the
Company or any of its Subsidiaries, would individually or in the aggregate
have a material adverse effect on the consolidated financial position,
stockholders' equity or results of operations of the Company and its
Subsidiaries considered as one enterprise; and, to the best of the
Company's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(n) The Company and the Significant Subsidiaries have good and
marketable title to all the material properties and assets reflected as
owned in the financial statements hereinabove described (or elsewhere in
the Prospectus), subject to no lien, mortgage, pledge, charge or
encumbrance of any kind except (i) those, if any, reflected in such
financial statements (or elsewhere in the Prospectus), or (ii) those which
are not material in amount and do not adversely affect the use made and
proposed to be made of such property by the Company and the Significant
Subsidiaries; each of the Company and the Significant Subsidiaries holds
its respective leased properties under valid and binding leases, with such
exceptions as are not materially significant in relation to the business of
the Company and its Subsidiaries considered as one enterprise; except as
disclosed in the Prospectus, the Company owns, leases or has the right to
possess all such real properties as are necessary to its operations as now
conducted;
(o) The Company and its Significant Subsidiaries possess such material
certificates, authorizations or permits issued by the appropriate state,
federal or foreign regulatory agencies or bodies as are currently necessary
to conduct the business now operated by them, and neither the Company nor
any of its Significant Subsidiaries has received, or has any reason to
believe that it will receive, any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would materially and adversely affect the
condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its Subsidiaries considered as one
enterprise;
(p) The Company and the Significant Subsidiaries have all material
governmental licenses, certificates, permits, authorizations, approvals,
franchises or other rights (including all authorizations from any gaming
authorities) necessary to carry on a gaming business as such business is
presently conducted; neither the Company nor any of its Significant
Subsidiaries has any reason to believe that any governmental body or agency
is considering limiting, suspending or revoking any such license,
certificate, permit, authorization, approval, franchise or right in any
material respect; neither the Company nor any of its Significant
Subsidiaries has any reason to believe that any such license, permit or
approval necessary in
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the future to conduct the business of the Company and its Significant
Subsidiaries as described in the Prospectus will not be granted upon
application, or that the Nevada Gaming Authorities or any other
governmental agencies are investigating the Company or any of its
Significant Subsidiaries other than in normal course administrative reviews
or any ordinary course review of the transactions contemplated hereby;
(q) The Company and the Significant Subsidiaries have filed all
required federal, state and foreign income and franchise tax returns and
have paid all taxes shown as due thereon, other than taxes being timely
contested by appropriate proceedings, and the Company has no knowledge of
any tax deficiency which has been or might be asserted or threatened
against the Company or any Significant Subsidiary which might reasonably be
expected to materially and adversely affect the business, operations or
properties of the Company and its Subsidiaries, considered as one
enterprise;
(r) The Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(s) The Company has reviewed its operations and that of its
Subsidiaries and any third parties with which the Company or any of its
subsidiaries has a material relationship to evaluate the extent to which
the business or operations of the Company or any of its Subsidiaries will
be affected by the Year 2000 Problem. As a result of such review, the
Company has no reason to believe, and does not believe, that the Year 2000
Problem will have a material adverse effect on the general affairs,
management, the current or future consolidated financial position, business
or results of operations of the Company and its subsidiaries taken as a
whole or result in any material loss or interference with the Company's
business or operations. The "Year 2000 Problem" as used herein means any
significant risk that computer hardware or software used in the receipt,
transmission, processing, manipulation, storage, retrieval, retransmission
or other utilization of data or in the operation of mechanical or
electrical systems of any kind will not, in the case of dates or time
periods occurring after December 31, 1999, function at least as effectively
as in the case of dates or time periods occurring prior to January 1, 2000;
and
(t) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have certified certain consolidated
financial statements of the Company and its Subsidiaries, are independent
public accountants as required by the Act and the rules and regulations of
the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Shares and authorization by the Representatives of the release of the
Firm Shares, the several Underwriters propose to offer the Firm Shares for sale
upon the terms and conditions set forth in the Prospectus as amended or
supplemented.
The Company may specify in the Pricing Agreement applicable to any
Designated Shares that the Company thereby grants to the Underwriters the right
(an "Overallotment Option") to purchase at their election up to the number of
Optional Shares set forth in such Pricing Agreement, on the terms and conditions
set forth in the Prospectus as amended or supplemented, for the sole purpose of
covering over-allotments in the sale of the Firm Shares. Any such election to
purchase Optional Shares may be exercised by written notice from the
Representatives to the Company, given within a
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period specified in the Pricing Agreement, setting forth the aggregate number of
Optional Shares to be purchased and the date on which such Optional Shares are
to be delivered, as determined by the Representatives but in no event earlier
than the First Time of Delivery (as defined in Section 4 hereof) or, unless the
Representatives and the Company otherwise agree in writing, earlier than or
later than the respective number of business days after the date of such notice
set forth in such Pricing Agreement.
The number of Optional Shares to be added to the number of Firm Shares to
be purchased by each Underwriter as set forth in Schedule I to the Pricing
Agreement applicable to such Designated Shares shall be, in each case, the
number of Optional Shares which the Company has been advised by the
Representatives have been attributed to such Underwriter; provided that, if the
Company has not been so advised, the number of Optional Shares to be so added
shall be, in each case, that proportion of Optional Shares which the number of
Firm Shares to be purchased by such Underwriter under such Pricing Agreement
bears to the aggregate number of Firm Shares (rounded as the Representatives may
determine to the nearest 100 shares). The total number of Designated Shares to
be purchased by all the Underwriters pursuant to such Pricing Agreement shall be
the aggregate number of Firm Shares set forth in Schedule I to such Pricing
Agreement plus the aggregate number of Optional Shares which the Underwriters
elect to purchase.
4. Certificates for the Firm Shares and the Optional Shares to be
purchased by each Underwriter pursuant to the Pricing Agreement relating
thereto, in the form specified in such Pricing Agreement and in such authorized
denominations and registered in such names as the Representatives may request
upon at least forty-eight hours' prior notice to the Company, shall be delivered
by or on behalf of the Company to the Representatives for the account of such
Underwriter, against payment by such Underwriter or on its behalf of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to ▇▇▇▇▇▇▇, Sachs & Co. at least forty-eight
hours in advance as specified in such Pricing Agreement, (i) with respect to the
Firm Shares, all in the manner and at the place and time and date specified in
such Pricing Agreement or at such other place and time and date as the
Representatives and the Company may agree upon in writing, such time and date
being herein called the "First Time of Delivery" and (ii) with respect to the
Optional Shares, if any, in the manner and at the time and date specified by the
Representatives in the written notice given by the Representatives of the
Underwriters' election to purchase such Optional Shares, or at such other time
and date as the Representatives and the Company may agree upon in writing, such
time and date, if not the First Time of Delivery, herein called the "Second Time
of Delivery". Each such time and date for delivery is herein called a "Time of
Delivery".
5. The Company agrees with each of the Underwriters of any Designated
Shares:
(a) To prepare the Prospectus as amended and supplemented in relation
to the applicable Designated Shares in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the second
business day following the execution and delivery of the Pricing Agreement
relating to the applicable Designated Shares or, if applicable, such
earlier time as may be required by Rule 424(b); to make no further
amendment or any supplement to the Registration Statement or Prospectus as
amended or supplemented after the date of the Pricing Agreement relating to
such Shares and prior to any Time of Delivery for such Shares which shall
be disapproved by the Representatives for such Shares promptly after
reasonable notice thereof; to advise the Representatives promptly of any
such amendment or supplement
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after any Time of Delivery for such Shares and furnish the Representatives
with copies thereof; to file promptly all reports and any definitive proxy
or information statements required to be filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act for so long as the delivery of a prospectus is required in connection
with the offering or sale of such Shares, and during such same period to
advise the Representatives, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement has been filed or
becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed with the Commission, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any prospectus relating to the Shares, of the suspension of the
qualification of such Shares for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information; and, in
the event of the issuance of any such stop order or of any such order
preventing or suspending the use of any prospectus relating to the Shares
or suspending any such qualification, promptly to use its best efforts to
obtain the withdrawal of such order. Neither the Representatives' consent
to, nor the Underwriters' delivery of, any such amendment or supplement
shall constitute a waiver of any of the conditions set forth in Section 7;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Shares for offering
and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of such Shares,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the second New York
Business Day succeeding the date of this Agreement and from time to time,
to furnish the Underwriters with copies of the Prospectus as amended or
supplemented in New York City in such quantities as the Representatives may
reasonably request, and, if the delivery of a prospectus is required at any
time in connection with the offering or sale of the Shares and if at such
time any event shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act
or the Exchange Act, to notify the Representatives and upon their request
to file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules
9
and regulations of the Commission thereunder (including, at the option of
the Company, Rule 158);
(e) That, without the prior written consent of the Underwriters, it
will not, during the period ending 90 days after the date of the
Prospectus, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, lend, or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock
or (ii) enter into any swap or other arrangement that transfers to another,
in whole or in part, any of the economic consequences of ownership of the
Common Stock, whether any such transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Shares to be sold hereunder, (B) the issuance by the Company of
shares of Common Stock upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof or (C) the granting
of stock options or the issuance of restricted stock under the current
employee benefit plans of the Company.
(f) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement, and the Company shall at the time of filing either pay the
Commission the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee pursuant to Rule
111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Shares under the Act and all other expenses in connection
with the preparation, printing and filing of the Registration Statement, any
Preliminary Prospectus and the Prospectus and amendments and supplements thereto
and the mailing and delivering of copies thereof to the Underwriters and
dealers; (ii) the cost of printing or producing any Agreement among
Underwriters, this Agreement, any Pricing Agreement, any Blue Sky and Legal
Investment Memorandum, closing documents (including compilations thereof) and
any other documents in connection with the offering, purchase, sale and delivery
of the Shares; (iii) all expenses in connection with the qualification of the
Shares for offering and sale under state securities laws as provided in Section
5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky and Legal Investment survey(s); (iv) any filing fees incident to, and
the fees and disbursements of counsel for the Underwriters in connection with,
any required review by the NASD of the terms of the sale of the Shares; (v) the
cost of preparing certificates for the Shares; (vi) the cost and charges of any
transfer agent or registrar or dividend disbursing agent; and (vii) all other
costs and expenses incident to the performance of its obligations hereunder and
under any Over-allotment Options which are not otherwise specifically provided
for in this Section. It is understood, however, that, except as provided in this
Section, and Sections 8 and 11 hereof, the Underwriters will pay all of their
own costs and expenses, including the fees of their counsel, transfer taxes on
resale of any of the Shares by them, and any advertising expenses connected with
any offers they may make.
7. The obligations of the Underwriters of any Designated Shares under the
Pricing Agreement relating to such Designated Shares shall be subject, in the
discretion of the
10
Representatives, to the condition that all representations and warranties and
other statements of the Company in or incorporated by reference in the Pricing
Agreement relating to such Designated Shares are, at and as of each Time of
Delivery for such Designated Shares, true and correct, the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to such
Designated Shares shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Representatives' reasonable satisfaction;
(b) Counsel for the Underwriters or other counsel for the Company
satisfactory to the Representatives shall have furnished to the
Representatives such written opinion or opinions dated each Time of
Delivery for such Designated Shares, with respect to the matters covered in
paragraphs (i), (x) (other than "Gaming Regulation"), (xi) and (xiii) of
subsection (c) below as well as such other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Wolf, Block, ▇▇▇▇▇▇ and ▇▇▇▇▇-▇▇▇▇▇ LLP and/or ▇▇▇▇▇ ▇. ▇▇▇▇▇,
Assistant General Counsel, or other counsel for the Company satisfactory to
the Representatives shall have furnished to the Representatives their
written opinions dated each Time of Delivery for such Designated Shares,
respectively, in form and substance satisfactory to the Representatives, to
the effect that:
(i) Each of the Company and its Significant Subsidiaries has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation with
corporate power and authority to own or lease its properties and
conduct its business as described in the Registration Statement and the
Prospectus as amended or supplemented, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of each jurisdiction which requires such qualification, except
where the failure to be so qualified would not have a material adverse
effect on the business, operations or financial condition of the
Company and its Subsidiaries considered as one enterprise;
(ii) The Company has an authorized capitalization as set forth in
the Prospectus as amended or supplemented under the caption
"Capitalization," and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable; and the Designated Shares conform to the
description thereof in the Prospectus as amended or supplemented;
11
(iii) All of the outstanding shares of capital stock of each
Significant Subsidiary have been duly and validly authorized and issued
and are fully paid and non-assessable, and all outstanding shares of
capital stock of the Significant Subsidiaries are owned of record and,
to the best of such counsel's knowledge, beneficially by the Company
either directly or through wholly owned Subsidiaries, free and clear of
any perfected security interest and, to the best of such counsel's
knowledge, any other security interests, claims, liens or encumbrances;
(iv) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental proceedings
pending to which the Company or any of its Subsidiaries is a party or
of which any property of the Company or any of its Subsidiaries is the
subject which, if determined adversely to the Company or any of its
Subsidiaries, would individually or in the aggregate have a material
adverse effect on the consolidated financial position, stockholders'
equity or results of operations of the Company and its Subsidiaries
considered as one enterprise; and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(v) This Agreement and the Pricing Agreement with respect to the
Designated Shares have been duly authorized, executed and delivered by
the Company;
(vi) The issue and sale of the Designated Shares and the
compliance by the Company with all of the provisions of this Agreement
and the Pricing Agreement with respect to the Designated Shares and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company is a party or by
which the Company is bound or to which any of the property or assets of
the Company is subject, nor will such actions result in any violation
of the provisions of the Articles of Incorporation or By-laws of the
Company or any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Company or any of its properties (including, without
limitation, the gaming statutes or regulations of the State of Nevada
or its political subdivisions);
(vii) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body
(including, without limitation, the Nevada Gaming Authorities) is
required on the part of the Company for the issue and sale of the
Designated Shares by the Company or the consummation by the Company of
the transactions contemplated by this Agreement or such Pricing
Agreement, except such as have been obtained under the Act and such
other consents, approvals, authorizations, orders, registrations or
qualifications as have previously been obtained, or such as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Designated Shares by the Underwriters;
(viii) To the best knowledge of such counsel, neither the Company
nor any of its Significant Subsidiaries is in violation of its By-laws
or Articles or Certificate of Incorporation or in default in any
material respect in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
12
indenture, mortgage, deed of trust, loan agreement, lease or other
instrument to which it is a party or by which it or any of its
properties may be bound;
(ix) The Company and its Significant Subsidiaries have obtained all
licenses, permits and other governmental authorizations which are
material for the present conduct of their respective businesses (except
for building or similar permits and general business licenses from
counties or municipalities, as to which such counsel need express no
opinion), and to the best of such counsel's knowledge, such licenses,
permits and other governmental authorizations are in full force and
effect and the Company and each Significant Subsidiary are complying
therewith in all material respects;
(x) The statements incorporated by reference in the Prospectus from
the Company's registration statement on Form 8-A filed under Section 12
of the Exchange Act on July 23, 1980, as amended by Amendment No. 4
thereto filed on June 19, 1996, insofar as they purport to constitute a
summary of the terms of the Shares, and the statements set forth in the
Prospectus under the captions "Plan of Distribution" and "Gaming
Regulation" (including any information incorporated by reference with
respect thereto), insofar as they purport to describe the provisions of
the laws and documents referred to therein, are accurate, complete and
fair in all material respects;
(xi) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the Investment Company Act;
(xii) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements, notes
thereto and related schedules, as to which such counsel need express no
opinion), when they became effective or were filed with the Commission,
as the case may be, complied as to form in all material respects with
the requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder; and although such
counsel have not verified, and are not passing upon and do not assume
responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus,
such counsel have no reason to believe that any of such documents, when
they became effective or were so filed, as the case may be, contained,
in the case of a registration statement which became effective under
the Act, an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or, in the case of other documents
which were filed under the Act or the Exchange Act with the Commission,
an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such documents were
so filed, not misleading; to the best of such counsel's knowledge,
there are no franchises, leases, contracts, agreements or other
documents of a character required to be disclosed in the Registration
Statement or Prospectus or to be filed as exhibits to the Registration
Statement which are not disclosed or filed, as required; and
(xiii) The Registration Statement and the Prospectus as amended or
supplemented and any further amendments and supplements thereto made by
the Company prior to the Time of Delivery for the Designated Shares
(other than the
13
financial statements, notes thereto and related schedules, as to which
such counsel need express no opinion) comply as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; although such counsel do not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in
the Registration Statement or the Prospectus, except for those referred
to in the opinion in subsection (x) of this Section 7(c), they have no
reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior to
the Time of Delivery (other than the financial statements, notes
thereto and related schedules, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that, as of its date, the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company prior to the Time of Delivery
(other than the financial statements, notes thereto and related
schedules, as to which such counsel need express no opinion) contained
an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that, as of
the Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company prior to the Time of Delivery
(other than the financial statements, notes thereto and related
schedules, as to which such counsel need express no opinion) contains
an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and they do
not know of any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required to be
incorporated by reference into the Prospectus as amended or
supplemented or required to be described in the Registration Statement
or the Prospectus as amended or supplemented which are not filed or
incorporated by reference or described as required;
(d) On the date of the Pricing Agreement for such Designated Shares and
at each Time of Delivery for such Designated Shares, the independent
accountants of the Company who have certified the financial statements of
the Company and its subsidiaries included or incorporated by reference in
the Registration Statement shall have furnished to the Representatives a
letter, dated the effective date of the Registration Statement or the date
of the most recent report filed with the Commission containing financial
statements and incorporated by reference in the Registration Statement, if
the date of such report is later than such effective date, and a letter
dated such Time of Delivery, respectively, to the effect set forth in Annex
II hereto, and with respect to such letter dated such Time of Delivery, as
to such other matters as the Representatives may reasonably request and in
form and substance satisfactory to the Representatives;
(e) (i) Neither the Company nor any of its Subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended prior to
the date of the Pricing Agreement relating to the Designated Shares any
loss or interference with its business from fire, explosion, flood or other
calamity,
14
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus as amended prior to the date of the Pricing
Agreement relating to the Designated Shares, and (ii) since the respective
dates as of which information is given in the Prospectus as amended prior
to the date of the Pricing Agreement relating to the Designated Shares
there shall not have been any change in the capital stock or long-term debt
of the Company or any of its Subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its Subsidiaries, otherwise than as set forth
or contemplated in the Prospectus as amended prior to the date of the
Pricing Agreement relating to the Designated Shares, the effect of which,
in any such case described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Designated Shares on the terms and in the manner contemplated in the
Prospectus as amended or supplemented relating to the Designated Shares;
(f) On or after the date of the Pricing Agreement relating to the
Designated Shares (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities by any "nationally recognized
statistical rating organization", as that term is defined by the Commission
for purposes of Rule 436(g)(2) under the Act, and (ii) no such organization
shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of any of the debt
securities or preferred stock of the Company or its Subsidiaries;
(g) On or after the date of execution of the Pricing Agreement relating
to the Designated Shares there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange; (ii) a suspension or material
limitation in trading in the Company's securities on the New York Stock
Exchange or the Pacific Exchange; (iii) a general moratorium on commercial
banking activities declared by either Federal, New York, or Nevada
authorities; or (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war, if the effect of any such event specified in this clause
(iv) in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Firm
Shares or Optional Shares or both on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to
the Designated Shares;
(h) The Shares at each Time of Delivery shall be duly listed on the
New York Stock Exchange;
(i) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the second
New York Business Day succeeding the date of this Agreement; and
(j) The Company shall have furnished or caused to be furnished to the
Representatives at each Time of Delivery for the Designated Shares a
certificate or certificates of officers of the Company satisfactory to the
Representatives as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations hereunder to be
performed at or prior to
15
such Time of Delivery, as to the matters set forth in subsections (a) and
(e) of this Section and as to such other matters as the Representatives may
reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other
prospectus relating to the Shares, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other
prospectus relating to the Shares, or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter of Designated Shares through the Representatives
expressly for use therein or insofar as such loss, claim, damage,
liability, expense or action arises out of or is based upon any untrue
statement or omission in any Preliminary Prospectus which was identified to
such Underwriter in writing and was corrected in the Prospectus and it
shall have been established that the Underwriter seeking indemnification
fails to deliver a copy of the Prospectus to the person to whom liability
has been incurred at or prior to confirmation of the sales of Designated
Securities to such person in any case where such delivery is required by
the Act and such delivery would have cured the defect giving rise to the
liability hereunder.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Shares, or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Shares, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company
16
in connection with investigating or defending any such action or claim as
such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may
have to any indemnified party otherwise than under such subsection. In
case any such action shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party),
and, after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof
other than reasonable costs of investigation. No indemnifying party shall,
without the written consent of the indemnified party, which consent shall
not be unreasonably withheld, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party
is an actual or potential party to such action or claim) unless such
settlement, compromise or judgment (i) includes an unconditional release of
the indemnified party from all liability arising out of such action or
claim and (ii) does not include any statement as to or an admission of
fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters of the Designated Shares on the other from
the offering of the Designated Shares to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the
allocation provided by the immediately preceding sentence is not permitted
by applicable law or if the indemnified party failed to give the notice
required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company on the one hand and the Underwriters
of the Designated Shares on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and such Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company bear to the total underwriting discounts
and commissions
17
received by such Underwriters. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one
hand or such Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this subsection (d)
were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) referred to above in this subsection (d)
shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this subsection
(d), no Underwriter shall be required to contribute any amount in excess of
the amount by which the total price at which the applicable Designated
Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of
Designated Shares in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to
such Shares and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section 8 shall be in addition to any
liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of
the Company and to each person, if any, who controls the Company within the
meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Firm Shares or Optional Shares which it has agreed to purchase under
the Pricing Agreement relating to such Shares, the Representatives may in
their discretion arrange for themselves or another party or other parties
to purchase such Shares on the terms contained herein. If within thirty-
six hours after such default by any Underwriter the Representatives do not
arrange for the purchase of such Firm Shares or Optional Shares, as the
case may be, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to the Representatives to purchase such Shares on such terms.
In the event that, within the respective prescribed period, the
Representatives notify the Company that they have so arranged for the
purchase of such Shares, or the Company notifies the Representatives that
it has so arranged for the purchase of such Shares, the Representatives or
the Company shall have the right to postpone a Time of Delivery for such
Shares for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file
18
promptly any amendments or supplements to the Registration Statement or the
Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such
person had originally been a party to the Pricing Agreement with respect to
such Designated Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Firm Shares or Optional Shares, as the case may be, of a defaulting
Underwriter or Underwriters by the Representatives and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of
the Firm Shares or Optional Shares, as the case may be, to be purchased at
the respective Time of Delivery, then the Company shall have the right to
require each non-defaulting Underwriter to purchase the number of Firm
Shares or Optional Shares, as the case may be, which such Underwriter
agreed to purchase under the Pricing Agreement relating to such Designated
Shares and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Firm Shares or Optional
Shares, as the case may be, which such Underwriter agreed to purchase under
such Pricing Agreement) of the Firm Shares or Optional Shares, as the case
may be, of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Firm Shares or Optional Shares, as the case may be, of a defaulting
Underwriter or Underwriters by the Representatives and the Company as
provided in subsection (a) above, the aggregate number of Firm Shares or
Optional Shares, as the case may be, which remains unpurchased exceeds one-
eleventh of the aggregate number of the Firm Shares or Optional Shares, as
the case may be, to be purchased at the respective Time of Delivery, as
referred to in subsection (b) above, or if the Company shall not exercise
the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Firm Shares or Optional Shares, as the case may
be, of a defaulting Underwriter or Underwriters, then the Pricing Agreement
relating to such Firm Shares or the Over-allotment Option relating to such
Optional Shares, as the case may be, shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements
in Section 8 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If any Pricing Agreement or Over-allotment Option shall be terminated
pursuant to Section 9 hereof, the Company shall not then be under any liability
to any Underwriter with respect to the Firm Shares or Optional Shares with
respect to which such Pricing Agreement shall have been
19
terminated except as provided in Sections 6 and 8 hereof; but, if for any other
reason, Designated Shares are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Shares, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Shares
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Shares shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: General Counsel; provided, however, that any
notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at its address
set forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers and directors of the Company
and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any one
or more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
20
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof.
Very truly yours,
MIRAGE RESORTS, INCORPORATED
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
___________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: General Counsel
Accepted as of the date hereof:
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
By: /s/ ▇▇▇▇▇▇▇, Sachs & Co.
______________________________
(▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.)
S-1
ANNEX I
Pricing Agreement
-----------------
▇▇▇▇▇▇▇, Sachs & Co.,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
May 6, 1999
Ladies and Gentlemen:
Mirage Resorts, Incorporated, a Nevada corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated May 6, 1999 (the "Underwriting Agreement"),
between the Company on the one hand and ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. on the other hand,
to issue and sell to the Underwriter named in Schedule I hereto (the
"Underwriter") the Shares specified in Schedule II hereto (the "Designated
Shares"). Each of the provisions of the Underwriting Agreement is incorporated
herein by reference in its entirety, and shall be deemed to be a part of this
Agreement to the same extent as if such provisions had been set forth in full
herein; and each of the representations and warranties set forth therein shall
be deemed to have been made at and as of the date of this Pricing Agreement,
except that each representation and warranty which refers to the Prospectus in
Section 2 of the Underwriting Agreement shall be deemed to be a representation
or warranty as of the date of the Underwriting Agreement in relation to the
Prospectus (as therein defined), and also a representation and warranty as of
the date of this Pricing Agreement in relation to the Prospectus as amended or
supplemented relating to the Designated Shares which are the subject of this
Pricing Agreement. Each reference to the Representatives herein and in the
provisions of the Underwriting Agreement so incorporated by reference shall be
deemed to refer to you. Unless otherwise defined herein, terms defined in the
Underwriting Agreement are used herein as therein defined.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Shares, in the form
heretofore delivered to you is now proposed to be filed with the Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to the Underwriter, and the Underwriter agrees, to purchase from
the Company, at the time and place and at the purchase price to the Underwriter
set forth in Schedule II hereto, the number of Designated Shares set forth
opposite the name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, and upon acceptance hereof by you, this
letter and such acceptance hereof, including the provisions of the Underwriting
Agreement incorporated herein by reference, shall constitute a binding agreement
between each of the Underwriter and the Company.
Very truly yours,
MIRAGE RESORTS, INCORPORATED
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: General Counsel
Accepted as of the date hereof:
▇▇▇▇▇▇▇, Sachs & Co.
By: /s/ ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
---------------------------
(▇▇▇▇▇▇▇, Sachs & Co.)
S-1
SCHEDULE I
Number of
Designated
Shares
Underwriter to be Purchased
----------- -------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co................................. 16,633,663
-------------------
Total..................................... 16,633,663
===================
SCHEDULE II
Title of Designated Shares: Common Stock of Mirage Resorts, Incorporated, par
value $.004 per share
Number of Designated Shares: 16,633,663
Purchase Price by Underwriter:
$25.00 per Share
Form of Designated Shares:
Definitive form, to be made available for checking at least twenty-four hours
prior to the Time of Delivery at the office of The Depository Trust Company or
its designated custodian
Specified Funds for Payment of Purchase Price:
Federal (same-day) funds
Time of Delivery:
10:00 a.m. (New York City time), May 11, 1999
Closing Location: Offices of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Names and Addresses of Representatives:
Designated Representative: ▇▇▇▇▇▇▇, Sachs & Co.
Address for Notices, etc.: ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriter to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been furnished to the Underwriter;
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly reports on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which have been separately furnished to the Representatives; and on the
basis of specified procedures including inquiries of officials of the
Company who have responsibility for financial and accounting matters
regarding whether the unaudited condensed consolidated financial statements
referred to in paragraph (vi)(A)(i) below comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations, nothing came
to their attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under selected
captions with the disclosure requirements of Regulation S-K and on the
basis of limited procedures specified in such letter nothing came to their
attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with
F-1
the disclosure requirements of items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included or incorporated by reference
in the Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Exchange
Act and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus or
included in the Company's Quarterly Reports on Form 10-Q incorporated
by reference in the Prospectus, for them to be in conformity with
generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and items
were not determined on a basis substantially consistent with the basis
for the corresponding amounts in the audited consolidated financial
statements included or incorporated by reference in the Company's
Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited income
statement data and balance sheet items included in the Prospectus and
referred to in clause (B) were not determined on a basis substantially
consistent with the basis for the audited financial statements included
or incorporated by reference in the Company's Annual Report on Form 10-
K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than
F-2
issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest balance sheet included or
incorporated by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its subsidiaries, or any
decreases in consolidated net current assets or stockholders' equity or
other items specified by the Representatives, or any increases in any
items specified by the Representatives, in each case as compared with
amounts shown in the latest balance sheet included or incorporated by
reference in the Prospectus, except in each case for changes, increases
or decreases which the Prospectus discloses have occurred or may occur
or which are described in such letter; and
(F) for the period from the date of the latest financial statements
included or incorporated by reference in the Prospectus to the
specified date referred to in clause (E) there were any decreases in
consolidated net revenues or operating profit or the total or per share
amounts of consolidated net income or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may occur or
which are described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus (excluding
documents incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives
or in documents incorporated by reference in the Prospectus specified by
the Representatives, and have compared certain of such amounts, percentages
and financial information with the accounting records of the Company and
its subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Shares for purposes
of the letter delivered at the Time of Delivery for such Designated Shares.
F-3
