Exhibit 4.5


 


 




 


 





REGISTRATION RIGHTS
AGREEMENT


 


Dated as of March 10,
2005


 


By and Among


 


MERITAGE HOMES CORPORATION

as Issuer,


 


the GUARANTORS
named herein


 


and


 


UBS SECURITIES LLC,


 


CITIGROUP GLOBAL
MARKETS INC.,


 


and J.P. MORGAN
SECURITIES INC.,

as Initial Purchasers


 


6 1/4% Senior
Notes due 2015




 


 





 





















 


TABLE OF CONTENTS


 


	
  Section 1.

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.

  	
  Exchange
  Offer

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.

  	
  Shelf
  Registration Statement

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 4.

  	
  Liquidated
  Damages

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.

  	
  Registration
  Procedures

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.

  	
  Registration
  Expenses

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.

  	
  Indemnification

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 8.

  	
  Rules 144
  and 144A

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.

  	
  Underwritten
  Registrations

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 10.

  	
  Miscellaneous

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  No Inconsistent Agreements

  	
   

  
	
   

  	
  (b)

  	
  Adjustments Affecting Registrable Notes

  	
   

  
	
   

  	
  (c)

  	
  Amendments and Waivers

  	
   

  
	
   

  	
  (d)

  	
  Notices

  	
   

  
	
   

  	
  (e)

  	
  Guarantors

  	
   

  
	
   

  	
  (f)

  	
  Successors and Assigns

  	
   

  
	
   

  	
  (g)

  	
  Counterparts

  	
   

  
	
   

  	
  (h)

  	
  Headings

  	
   

  
	
   

  	
  (i)

  	
  Governing Law

  	
   

  
	
   

  	
  (j)

  	
  Severability

  	
   

  
	
   

  	
  (k)

  	
  Securities Held by the Company or Its
  Affiliates

  	
   

  
	
   

  	
  (l)

  	
  Third-Party Beneficiaries

  	
   

  
	
   

  	
  (m)

  	
  Attorneys’ Fees

  	
   

  
	
   

  	
  (n)

  	
  Entire Agreement

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNATURES

  	
   

  



 


i





















 


REGISTRATION RIGHTS AGREEMENT


 


This Registration Rights Agreement (this “Agreement”)
is dated as of March 10, 2004, by and among Meritage Homes Corporation, a
Maryland corporation (the “Company”), and each of the Guarantors (as
defined herein) (the Company and the Guarantors are referred to collectively
herein as the “Issuers”), on the one hand, and UBS Securities LLC, Citigroup
Global Markets Inc. and J.P. Morgan Securities Inc. (together, the “Initial
Purchasers”) on the other hand.


 


This Agreement is entered into in connection
with the Purchase Agreement, dated as of February 24, 2005, by and among
the Issuers and the Initial Purchasers, (the “Purchase Agreement”), relating
to the offering of $350,000,000 aggregate principal amount of the Company’s 6 1/4%
Senior Notes due 2015 (including the guarantees thereof by the Guarantors, the “Notes”).  The execution and delivery of this Agreement
is a condition to the Initial Purchasers’ obligation to purchase the Notes
under the Purchase Agreement.


 


The parties hereby agree as follows:


 


Section 1.                                            Definitions


 


As used in this Agreement, the following
terms shall have the following meanings:


 


“action”
shall have the meaning set forth in Section 7(c) hereof.


 


“Advice”
shall have the meaning set forth in Section 5 hereof.


 


“Agreement”
shall have the meaning set forth in the first introductory paragraph hereto.


 


“Applicable
Period” shall have the meaning set forth in Section 2(b) hereof.


 


“Board of
Directors” shall have the meaning set forth in Section 5 hereof.


 


“Business
Day” shall mean a day that is not a Legal Holiday.


 


“Company”
shall have the meaning set forth in the introductory paragraph hereto and shall
also include the Company’s permitted successors and assigns.


 


“Commission”
shall mean the Securities and Exchange Commission.


 


“day”
shall mean a calendar day.


 


“Delay
Period” shall have the meaning set forth in Section 5 hereof.


 


“Effectiveness
Period” shall have the meaning set forth in the second paragraph of Section 3(a) hereof.


 


“Event Date”
shall have the meaning set forth in Section 4(b) hereof.


 





















 


“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.


 


“Exchange
Notes” shall have the meaning set forth in Section 2(a) hereof.


 


“Exchange
Offer” shall have the meaning set forth in Section 2(a) hereof.


 


“Exchange
Offer Registration Statement” shall have the meaning set forth in Section 2(a) hereof.


 


“Guarantors”
means each of the Persons executing this Agreement (as set forth on Schedule A)
on the date hereof and each Person who executes and delivers a counterpart of
this Agreement hereafter pursuant to Section 10(e) hereof.


 


“Holder”
shall mean any holder of a Registrable Note or Registrable Notes.


 


“Indenture”
shall mean the Indenture, dated as of March 10, 2005, by and among the Issuers
and Wells Fargo Bank, National Association, as trustee, pursuant to which the
Notes are being issued, as amended or supplemented from time to time in accordance
with the terms thereof.


 


“Initial
Purchasers” shall have the meaning set forth in the first introductory
paragraph hereof.


 


“Initial
Shelf Registration Statement” shall have the meaning set forth in Section 3(a) hereof.


 


“Inspectors”
shall have the meaning set forth in Section 5(n) hereof.


 


“Issue Date”
shall mean March 10, 2005, the date of original issuance of the Notes.


 


“Issuers”
shall have the meaning set forth in the introductory paragraph hereto.


 


“Legal
Holiday” shall mean a Saturday, a Sunday or a day on which banking
institutions in New York, New York are required by law, regulation or executive
order to remain closed.


 


“Liquidated
Damages” shall have the meaning set forth in Section 4(a) hereof.


 


“Losses”
shall have the meaning set forth in Section 7(a) hereof.


 


“NASD”
shall have the meaning set forth in Section 5(s) hereof.


 


“Notes”
shall have the meaning set forth in the second introductory paragraph hereto.


 


“Participant”
shall have the meaning set forth in Section 7(a) hereof.


 


“Participating
Broker-Dealer” shall have the meaning set forth in Section 2(b) hereof.


 


2





















 


“Person”
shall mean an individual, corporation, partnership, joint venture association,
joint stock company, trust, unincorporated limited liability company,
government or any agency or political subdivision thereof or any other entity.


 


“Private
Exchange” shall have the meaning set forth in Section 2(b) hereof.


 


“Private
Exchange Notes” shall have the meaning set forth in Section 2(b) hereof.


 


“Prospectus”
shall mean the prospectus included in any Registration Statement (including,
without limitation, any prospectus subject to completion and a prospectus that
includes any information previously omitted from a prospectus filed as part of
an effective registration statement in reliance upon Rule 430A promulgated
under the Securities Act), as amended or supplemented by any prospectus
supplement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference
or deemed to be incorporated by reference in such Prospectus.


 


“Purchase
Agreement” shall have the meaning set forth in the second introductory paragraph
hereof.


 


“Records”
shall have the meaning set forth in Section 5(n) hereof.


 


“Registrable
Notes” shall mean each Note upon its original issuance and at all times
subsequent thereto, each Exchange Note as to which Section 2(c)(iv) hereof
is applicable upon original issuance and at all times subsequent thereto and
each Private Exchange Note upon original issuance thereof and at all times
subsequent thereto, in each case until (i) a Registration Statement (other
than, with respect only to any Exchange Note as to which Section 2(c)(iv) hereof
is applicable, the Exchange Offer Registration Statement) covering such Note,
Exchange Note or Private Exchange Note has been declared effective by the
Commission and such Note, Exchange Note or such Private Exchange Note, as the
case may be, has been disposed of in accordance with such effective Registration
Statement, (ii) such Note has been exchanged pursuant to the Exchange
Offer for an Exchange Note or Exchange Notes that may be resold without
restriction under state and federal securities laws, (iii) such Note,
Exchange Note or Private Exchange Note, as the case may be, ceases to be outstanding
for purposes of the Indenture or (iv) such Note, Exchange Note or Private
Exchange Note has been sold in compliance with Rule 144 or is salable pursuant
to Rule 144(k).


 


“Registration
Default” shall have the meaning set forth in Section 4(a) hereof.


 


“Registration
Statement” shall mean any appropriate registration statement of the Issuers
covering any of the Registrable Notes filed with the Commission under the Securities
Act, and all amendments and supplements to any such Registration Statement,
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.


 


“Requesting
Participating Broker-Dealer” shall have the meaning set forth in Section 2(b) hereof.


 


3





















 


“Rule 144”
shall mean Rule 144 promulgated under the Securities Act, as such Rule may
be amended from time to time, or any similar rule (other than Rule 144A)
or regulation hereafter adopted by the Commission providing for offers and
sales of securities made in compliance therewith resulting in offers and sales
by subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.


 


“Rule 144A”
shall mean Rule 144A promulgated under the Securities Act, as such Rule may
be amended from time to time, or any similar rule (other than Rule 144)
or regulation hereafter adopted by the Commission.


 


“Rule 415”
shall mean Rule 415 promulgated under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission.


 


“Securities
Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.


 


“Shelf
Filing Event” shall have the meaning set forth in Section 2(c) hereof.


 


“Shelf
Registration Statement” shall have the meaning set forth in Section 3(b) hereof.


 


“Subsequent
Shelf Registration Statement” shall have the meaning set forth in Section 3(b) hereof.


 


“TIA”
shall mean the Trust Indenture Act of 1939, as amended.


 


“Trustee”
shall mean the trustee under the Indenture and the trustee (if any) under any
indenture governing the Exchange Notes and Private Exchange Notes.


 


“underwritten registration or underwritten
offering” shall mean a registration in which securities of the Company are
sold to an underwriter for reoffering to the public.


 


Section 2.                                            Exchange
Offer


 


(a)                                  The
Issuers shall (i) file a Registration Statement (the “Exchange Offer
Registration Statement”) within 75 days after the Issue Date with the
Commission on an appropriate registration form with respect to a registered
offer (the “Exchange Offer”) to exchange any and all of the Registrable
Notes for a like aggregate principal amount of notes (including the guarantees
with respect thereto, the “Exchange Notes”) that are identical in all
material respects to the Notes (except that the Exchange Notes bear no restrictive
legend thereon and shall not contain terms with respect to Liquidated Damages
upon a Registration Default), (ii) use their respective reasonable best
efforts to cause the Exchange Offer Registration Statement to be declared
effective under the Securities Act within 150 days after the Issue Date and (iii) use
their respective reasonable best efforts to complete the Exchange Offer within
180 days after the Issue Date.  The
Exchange Offer shall be deemed completed or consummated for purposes of this
Agreement upon delivery by the Company to the Trustee under the Indenture of
Exchange Notes in the same aggregate principal amount as the aggregate
principal amount of Notes tendered (and not withdrawn) by Holders thereof
pursuant to the Exchange Offer.  Upon the
Exchange Offer Registration Statement being declared effective by the Commission,
the Company will offer the Exchange Notes in


 


4





















 


exchange for surrender of the Notes. 
The Company shall keep the Exchange Offer open for not less than 20
Business Days (or longer if required by applicable law to complete the Exchange
Offer) after the date notice of the Exchange Offer is mailed to Holders.


 


Each Holder that participates in the Exchange
Offer will be required to represent to the Company in writing (which may be
contained in the applicable letter of transmittal) that (i) any Exchange
Notes to be received by it will be acquired in the ordinary course of its business,
(ii) it has no arrangement or understanding with any Person to participate
in the distribution (within the meaning of the Securities Act) of the Exchange
Notes in violation of the Securities Act, (iii) it is not an affiliate (as
defined in Rule 405 under the Securities Act) of any Issuer or, if it is an
affiliate, it will comply with the registration and prospectus delivery requirements
of the Securities Act to the extent applicable, (iv) if such Holder is not
a broker-dealer, it is not engaged in, and does not intend to engage in, a
distribution of Exchange Notes, (v) if such Holder is a broker-dealer that
will receive Exchange Notes for its own account in exchange for Notes that were
acquired as a result of market-making or other trading activities, it will
deliver a prospectus in connection with any resale of such Exchange Notes and (vi) the
Holder is not acting on behalf of any Persons who could not truthfully make the
foregoing representations.


 


(b)                                 The
Company and the Initial Purchasers acknowledge that the staff of the Commission
has taken the position that any broker-dealer that elects to exchange Notes
that were acquired by such broker-dealer for its own account as a result of
market-making or other trading activities for Exchange Notes in the Exchange
Offer (a “Participating Broker-Dealer”) may be deemed to be an “underwriter”
within the meaning of the Securities Act and must deliver a prospectus meeting
the requirements of the Securities Act in connection with any resale of such
Exchange Notes (other than a resale of an unsold allotment resulting from the
original offering of the Notes).


 


The Company and the Initial Purchasers also
acknowledge that the staff of the Commission has taken the position that if the
Prospectus contained in the Exchange Offer Registration Statement includes a
plan of distribution containing a statement to the above effect and the means
by which Participating Broker-Dealers may resell the Exchange Notes, without
naming the Participating Broker-Dealers or specifying the amount of Exchange
Notes owned by them, such Prospectus may be delivered by Participating
Broker-Dealers to satisfy their prospectus delivery obligations under the
Securities Act in connection with resales of Exchange Notes for their own
accounts, so long as the Prospectus otherwise meets the requirements of the
Securities Act.


 


In light of the foregoing, if requested by a
Participating Broker-Dealer (a “Requesting Participating Broker-Dealer”),
the Issuers agree to use their reasonable best efforts to keep the Exchange
Offer Registration Statement continuously effective for a period of up to 180
days after the date on which the Exchange Offer Registration Statement is
declared effective, or such longer period if extended pursuant to the last
paragraph of Section 5 hereof (such period, the “Applicable Period”),
or such earlier date as all Requesting Participating Broker-Dealers shall have
notified the Company in writing that such Requesting Participating
Broker-Dealers have resold all Exchange Notes acquired in the Exchange
Offer.  The Company shall include a plan
of distribution in such Exchange Offer Registration Statement that meets the
requirements set forth in the preceding paragraph.


 


If, prior to consummation of the Exchange
Offer, any Holder holds any Notes acquired by it that have, or that are reasonably
likely to be determined to have, the status of an unsold allotment in an
initial distribution, or if any Holder is not entitled to participate in the
Exchange Offer, the Company


 


5





















 


upon the request of any such Holder shall
simultaneously with the delivery of the Exchange Notes in the Exchange Offer,
issue and deliver to any such Holder, in exchange (the “Private Exchange”)
for such Notes held by any such Holder, a like principal amount of notes (the “Private
Exchange Notes”) of the Company that are identical in all material respects
to the Exchange Notes, except for the placement of a restrictive legend on such
Private Exchange Notes.  The Private
Exchange Notes shall be issued pursuant to the same indenture as the Exchange
Notes and bear the same CUSIP number as the Exchange Notes.


 


In connection with the Exchange Offer, the
Company shall:


 


(1)                                  mail
or cause to be mailed to each Holder entitled to participate in the Exchange
Offer a copy of the Prospectus forming part of the Exchange Offer Registration
Statement, together with an appropriate letter of transmittal and related documents;


 


(2)                                  utilize
the services of a depositary for the Exchange Offer with an address in the
Borough of Manhattan, The City of New York;


 


(3)                                  permit
Holders to withdraw tendered Notes at any time prior to the close of business,
New York time, on the last Business Day on which the Exchange Offer shall
remain open; and


 


(4)                                  otherwise
comply in all material respects with all applicable laws, rules and regulations.


 


As soon as practicable after the close of the
Exchange Offer and the Private Exchange, if any, the Company shall:


 


(1)                                  accept
for exchange all Registrable Notes validly tendered and not validly withdrawn
pursuant to the Exchange Offer and the Private Exchange, if any;


 


(2)                                  deliver
or cause to be delivered to the Trustee for cancellation all Registrable Notes
so accepted for exchange; and


 


(3)                                  cause
the Trustee to authenticate and deliver promptly to each Holder of Notes,
Exchange Notes or Private Exchange Notes, as the case may be, equal in principal
amount to the Notes of such Holder so accepted for exchange.


 


The Exchange Offer and the Private Exchange
shall not be subject to any conditions, other than that (i) the Exchange
Offer or Private Exchange, as the case may be, does not violate applicable law
or any applicable interpretation of the staff of the Commission, (ii) no action
or proceeding shall have been instituted or threatened in any court or by any
governmental agency which might materially impair the ability of the Issuers to
proceed with the Exchange Offer or the Private Exchange, and no material
adverse development shall have occurred in any existing action or proceeding
with respect to the Issuers that would impair their ability to so proceed and (iii) all
governmental approvals shall have been obtained, which approvals the Issuers
deem necessary for the consummation of the Exchange Offer or Private Exchange.


 


6





















 


In the event that the Issuers are unable to
consummate the Exchange Offer or the Private Exchange due to any event listed
in clauses (i) through (iii) above, the Issuers shall not be deemed
to have breached any covenant under this Section 2.


 


The Exchange Notes and the Private Exchange
Notes shall be issued under (i) the Indenture or (ii) an indenture
identical in all material respects to the Indenture (in either case, with such
changes as are necessary to comply with any requirements of the Commission to
effect or maintain the qualification thereof under the TIA) and which, in
either case, has been qualified under the TIA and shall provide that the
Exchange Notes shall not be subject to the transfer restrictions set forth in
the Indenture.  The Indenture or such other
indenture shall provide that when a vote or consent of the Holders is required,
the Exchange Notes, the Private Exchange Notes and the Notes shall vote and
consent together on all matters as one class and that none of the Exchange
Notes, the Private Exchange Notes or the Notes will have the right to vote or
consent as a separate class on any matter.


 


(c)                                  In
the event that (i) any changes in law or the applicable interpretations of
the staff of the Commission do not permit the Issuers to effect the Exchange
Offer, (ii) for any reason the Exchange Offer is not consummated within
180 days of the Issue Date, (iii) any Holder notifies the Company
that it is prohibited by law or the applicable interpretations of the staff of
the Commission from participating in the Exchange Offer, (iv) in the case
of any Holder that participates in the Exchange Offer, such Holder does not
receive Exchange Notes on the date of the exchange that may be sold without restriction
under state and federal securities laws (other than due solely to the status of
such holder as an affiliate of any Issuer), (v) any Initial Purchaser so
requests with respect to Notes that have, or that are reasonably likely to be
determined to have, the status of unsold allotments in an initial distribution
or (vi) any Holder of Private Exchange Notes so requests (each such event
referred to in clauses (i) through (vi) of this sentence, a “Shelf
Filing Event”), then the Issuers shall file a Shelf Registration Statement
pursuant to Section 3 hereof.


 


Section 3.                                            Shelf
Registration Statement


 


If at any time a Shelf Filing Event shall
occur, then:


 


(a)                                  Shelf
Registration Statement.  The Issuers
shall file with the Commission a Registration Statement for an offering to be
made on a continuous basis pursuant to Rule 415 covering all of the
Registrable Notes not exchanged in the Exchange Offer, Private Exchange Notes
and Exchange Notes as to which Section 2(c)(iv) is applicable, which
may be an amendment to the Exchange Offer Registration Statement (the “Initial
Shelf Registration Statement”).  The
Issuers shall file with the Commission the Initial Shelf Registration Statement
as promptly as practicable and in any event on or prior to 45 days after the
Company determines or is notified that a Shelf Filing Event has occurred.  The Initial Shelf Registration Statement
shall be on Form S-3 or another appropriate form permitting registration
of such Registrable Notes for resale by Holders in the manner or manners
designated by them (including, without limitation, one or more underwritten
offerings).  The Issuers shall not permit
any securities other than the Registrable Notes to be included in the Initial
Shelf Registration Statement or in any Subsequent Shelf Registration Statement
(as defined below).  Notwithstanding the foregoing,
in the event a Shelf Filing Event occurs as a result of the event set forth in Section 2(c)(ii),
the Issuers’ obligation to file and Initial Shelf Registration pursuant to this
Section 3 shall cease ab initio if
the Exchange Offer is


 


7





















 


completed within 225 days of
the Issue Date, or, if such date is not a Business Day, the next day that is a
Business Day.


 


The Issuers
shall use their respective reasonable best efforts (x) to cause the
Initial Shelf Registration Statement to be declared effective under the
Securities Act on or prior to the 90th day after the Company determines or is
notified that such a Shelf Filing Event has occurred and (y) to keep the
Initial Shelf Registration Statement continuously effective under the
Securities Act for the period ending on the date which is two years from the
date it becomes effective (or one year if the Initial Shelf Registration
Statement is filed at the request of an Initial Purchaser), subject to extension
pursuant to the penultimate paragraph of Section 5 hereof (the “Effectiveness
Period”), or such shorter period ending when (i) all Registrable Notes
covered by the Initial Shelf Registration Statement have been sold in the
manner set forth and as contemplated in the Initial Shelf Registration
Statement or cease to be outstanding, (ii) all Registrable Notes are
eligible to be sold to the public pursuant to Rule 144(k) under the
Securities Act or (iii) a Subsequent Shelf Registration Statement covering
all of the Registrable Notes covered by and not sold under the Initial Shelf
Registration Statement or an earlier Subsequent Shelf Registration Statement
has been declared effective under the Securities Act; provided, however,
that (i) the Effectiveness Period in respect of the Initial Shelf
Registration Statement shall be extended to the extent required to permit
dealers to comply with the applicable prospectus delivery requirements of Rule 174
under the Securities Act and as otherwise provided herein and (ii) the
Company may suspend the effectiveness of the Initial Shelf Registration
Statement by written notice to the Holders solely as a result of the filing of
a post-effective amendment to the Initial Shelf Registration Statement where
such post-effective amendment is not yet effective and needs to be declared
effective to permit holders to use the related Prospectus.


 


(b)                                 Subsequent
Shelf Registration Statements.  If
the Initial Shelf Registration Statement or any Subsequent Shelf Registration
Statement ceases to be effective for any reason at any time during the
Effectiveness Period (other than because of the sale of all of the securities
registered thereunder), the Issuers shall use their respective reasonable best
efforts to obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event shall as soon as practicable after such
cessation amend the Initial Shelf Registration Statement or such Subsequent
Shelf Registration Statement, as the case may be, in a manner to obtain the withdrawal
of the order suspending the effectiveness thereof, or file an additional “shelf”
Registration Statement pursuant to Rule 415 covering all of the
Registrable Notes covered by and not sold under the Initial Shelf Registration
Statement or such earlier Subsequent Shelf Registration Statement (each, a “Subsequent
Shelf Registration Statement”).  If a
Subsequent Shelf Registration Statement is filed, the Issuers shall use their
respective reasonable best efforts to cause the Subsequent Shelf Registration
Statement to be declared effective under the Securities Act as soon as
practicable after such filing and to keep such Subsequent Shelf Registration
Statement continuously effective for a period equal to the number of days in
the Effectiveness Period less the aggregate number of days during which the
Initial Shelf Registration Statement and any Subsequent Shelf Registration
Statement was previously continuously effective.  As used herein, the term “Shelf
Registration Statement” means the Initial Shelf Registration Statement and
any Subsequent Shelf Registration Statement.


 


(c)                                  Supplements
and Amendments.  The Issuers agree to
supplement or make amendments to the Shelf Registration Statement as and when
required by the rules, regulations or


 


8





















 


instructions applicable to the registration form used for such Shelf
Registration Statement or by the Securities Act or rules and regulations
thereunder for shelf registration, or if reasonably requested by the Holders of
a majority in aggregate principal amount of the Registrable Notes covered by
such Registration Statement or by any underwriter of such Registrable Notes; provided,
however, that the Issuers shall not be required to supplement or amend
any Shelf Registration Statement upon the request of a Holder or any
underwriter if such requested supplement or amendment would, in the good faith
judgment of the Company (based on advice of counsel), violate the Securities
Act, the Exchange Act or the rules and regulations promulgated thereunder.


 


Section 4.                                            Liquidated
Damages


 


(a)                                  The
Issuers and the Initial Purchasers agree that the Holders will suffer damages
if the Issuers fail to fulfill their obligations under Section 2 or Section 3
hereof and that it would not be feasible to ascertain the extent of such
damages with precision.  Accordingly, the
Issuers agree that if:


 


(i)                                     the
Exchange Offer Registration Statement is not filed with the Commission on or
prior to the 75th day following the Issue Date, or, if that day is not a
Business Day, then the next day that is a Business Day,


 


(ii)                                  the
Exchange Offer Registration Statement is not declared effective on or prior to
the 150th day following the Issue Date, or, if that day is not a Business Day,
then the next day that is a Business Day,


 


(iii)                               the
Exchange Offer is not completed on or prior to the 180th day following the
Issue Date, or, if that day is not a Business Day, then the next day that is a
Business Day, or


 


(iv)                              the
Shelf Registration Statement is required to be filed but is not filed or declared
effective within the time periods set forth herein or is declared effective but
thereafter ceases to be effective or usable prior to the expiration of the Effectiveness
Period, except if the Shelf Registration Statement ceases to be effective or
usable as specifically permitted by the penultimate paragraph of Section 5
hereof


 


(each such
event referred to in clauses (i) through (iv) a “Registration
Default”), liquidated damages in the form of additional cash interest (“Liquidated
Damages”) will accrue on the affected Notes and the affected Exchange
Notes, as applicable.  The rate of Liquidated
Damages will be 0.25% per annum for the first 90-day period (or portion
thereof) immediately following the occurrence of a Registration Default, increasing
by an additional 0.25% per annum with respect to each subsequent 90-day period
(or portion thereof) up to a maximum amount of additional interest of 1.00% per
annum, from and including the date on which any such Registration Default shall
occur to, but excluding, the earlier of (1) the date on which all Registration
Defaults have been cured or (2) the date on which all the Notes and
Exchange Notes otherwise become freely transferable by Holders other than
affiliates of the Issuers without further registration under the Securities
Act.


 


Notwithstanding the foregoing, (1) the
amount of Liquidated Damages payable shall not increase because more than one
Registration Default has occurred and is pending, (2) a Holder of Notes or
Exchange Notes who is not entitled to the benefits of the Shelf Registration
Statement (i.e., such Holder has not elected to include information)
shall not be entitled to Liquidated Damages with respect to


 


9





















 


a Registration Default that pertains to the
Shelf Registration Statement and (3) no holder of Notes constituting an unsold
allotment from the original sale of the Notes by the Company to the Initial
Purchasers shall be entitled to Liquidated Damages by reason of a Registration
Default that pertains to an Exchange Offer.


 


Notwithstanding anything to the contrary set
forth herein, with respect to any Registration Default, (1) upon filing of
the Exchange Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of clause (i) or (iv) above, (2) upon
the effectiveness of the Exchange Offer Registration Statement (and/or, if
applicable, the Shelf Registration Statement), in the case of clause (ii) or
(iv) above, (3) upon completion of the Exchange Offer, in the case of
clause (iii) above, or (4) upon the filing of a post-effective amendment
to the Registration Statement or an additional Registration Statement that
causes the Exchange Offer Registration Statement (and/or, if applicable, the
Shelf Registration Statement) to again be declared effective or made usable,
the applicable Registration Default shall be deemed to have been cured.


 


(b)                                 The
Company shall notify the Trustee within one Business Day after each and every
date on which an event occurs in respect of which Liquidated Damages are
required to be paid (an “Event Date”). 
Any amounts of Liquidated Damages due pursuant to this Section 4
will be payable in addition to any other interest payable from time to time
with respect to the Registrable Notes in cash semi-annually on the interest
payment dates specified in the Indenture (to the holders of record as specified
in the Indenture), commencing with the first such interest payment date
occurring after any such Liquidated Damages commence to accrue.  The amount of Liquidated Damages will be
determined in a manner consistent with the calculation of interest under the
Indenture.


 


Section 5.                                            Registration
Procedures


 


In connection with the filing of any
Registration Statement pursuant to Section 2 or 3 hereof, the Issuers
shall effect such registrations to permit the sale of the securities covered
thereby in accordance with the intended method or methods of disposition
thereof, and pursuant thereto and in connection with any Registration Statement
filed by the Issuers hereunder, the Issuers shall:


 


(a)                                  Prepare
and file with the Commission the Registration Statement or Registration
Statements prescribed by Section 2 or 3 hereof, and use their reasonable
best efforts to cause each such Registration Statement to become effective and
remain effective as provided herein; provided, however, that, if (1) such
filing is pursuant to Section 3 hereof, or (2) a Prospectus contained
in the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period relating thereto, before filing any Registration Statement or
Prospectus or any amendments or supplements thereto, the Company shall furnish
to and afford the Holders of the Registrable Notes covered by such Registration
Statement or each such Participating Broker-Dealer, as the case may be, their
counsel and the managing underwriters, if any, a reasonable opportunity to
review copies of all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto) proposed to be
filed (in each case at least five Business Days prior to such filing).  The Issuers shall not file any Registration
Statement or Prospectus or any amendments or supplements thereto if the Holders
of a majority in aggregate principal amount of the Registrable Notes covered by
such Registration Statement, or any such Participating Broker-Dealer, as the
case may be, their counsel, or the


 


10





















 


managing underwriters, if any,
shall reasonably object within five Business Days after receipt thereof.


 


(b)                                 Prepare
and file with the Commission such amendments and post-effective amendments to
each Initial Shelf Registration Statement or Exchange Offer Registration Statement,
as the case may be, as may be necessary to keep such Registration Statement continuously
effective for the Effectiveness Period or the Applicable Period, as the case
may be; cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) promulgated under
the Securities Act; and comply with the provisions of the Securities Act and
the Exchange Act with respect to the disposition of all securities covered by
such Registration Statement as so amended or in such Prospectus as so
supplemented and with respect to the subsequent resale of any securities being
sold by a Participating Broker-Dealer covered by any such Prospectus, in each
case, in accordance with the intended methods of distribution set forth in such
Registration Statement or Prospectus, as so amended.


 


(c)                                  If
(1) a Shelf Registration Statement is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period relating thereto from whom the
Issuers have received written notice that it will be a Participating
Broker-Dealer in the Exchange Offer, notify the selling Holders of Registrable
Notes, or each such Participating Broker-Dealer, as the case may be, their
counsel and the managing underwriters, if any, as promptly as possible, and, if
requested by any such Person, confirm such notice in writing, (i) when a
Prospectus or any Prospectus supplement or post-effective amendment has been
filed, and, with respect to a Registration Statement or any post-effective amendment,
when the same has become effective under the Securities Act (including in such
notice a written statement that any Holder may, upon request in writing,
obtain, at the sole expense of the Company, one conformed copy of such
Registration Statement or post-effective amendment including financial
statements and schedules, documents incorporated or deemed to be incorporated
by reference and exhibits), (ii) of the issuance by the Commission of any
stop order suspending the effectiveness of a Registration Statement or of any
order preventing or suspending the use of any preliminary prospectus or the
initiation of any proceedings for that purpose, (iii) if at any time when
a Prospectus is required by the Securities Act to be delivered in connection
with sales of the Registrable Notes or resales of Exchange Notes by
Participating Broker-Dealers the representations and warranties of the Issuers
contained in any agreement (including any underwriting agreement) contemplated
by Section 5(m) hereof cease to be true and correct in all material
respects, (iv) of the receipt by any of the Issuers of any notification
with respect to the suspension of the qualification or exemption from qualification
of a Registration Statement or any of the Registrable Notes or the Exchange
Notes for offer or sale in any jurisdiction, or the initiation or threatening
of any proceeding for such purpose, (v) of the happening of any event, the
existence of any condition or any information becoming known to any Issuer that
makes any statement made in such Registration Statement or related Prospectus
or any document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any changes in or
amendments or supplements to such Registration Statement, Prospectus or
documents so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not


 


11





















 


misleading, and that in the case of the Prospectus, it will not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, and (vi) of
the Company’s determination that a post-effective amendment to a Registration
Statement would be appropriate.


 


(d)                                 If
(1) a Shelf Registration Statement is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, use their reasonable best efforts
to prevent the issuance of any order suspending the effectiveness of a
Registration Statement or of any order preventing or suspending the use of a
Prospectus or suspending the qualification (or exemption from qualification) of
any of the Registrable Notes or the Exchange Notes, as the case may be, for
sale in any jurisdiction, and, if any such order is issued, to use their
reasonable best efforts to obtain the withdrawal of any such order at the earliest
practicable moment.


 


(e)                                  If
(1) a Shelf Registration Statement is filed pursuant to Section 3 or (2) a
Prospectus contained in the Exchange Offer Registration Statement filed
pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period and if requested by the managing underwriter
or underwriters (if any), the Holders of a majority in aggregate principal
amount of the Registrable Notes covered by such Registration Statement or any
Participating Broker-Dealer, as the case may be, (i) as promptly as
practicable incorporate in such Registration Statement or Prospectus a
prospectus supplement or post-effective amendment such information as the
managing underwriter or underwriters (if any), such Holders or any
Participating Broker-Dealer, as the case may be (based upon advice of counsel),
reasonably request as necessary to be included therein and (ii) make all
required filings of such prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment; provided, however, that the Issuers shall not be
required to take any action hereunder that would, in the good faith judgment of
the Company (based on advice of counsel), violate applicable laws.


 


(f)                                    If
(1) a Shelf Registration Statement is filed pursuant to Section 3
hereof or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, furnish to each selling Holder of
Registrable Notes and a single counsel to such Holders, or each such Participating
Broker-Dealer and their counsel, as the case may be, who so requests and each
managing underwriter, if any, and a single counsel for such underwriters, at
the sole expense of the Company, one conformed copy of the Registration
Statement or Registration Statements and each post-effective amendment thereto,
including financial statements and schedules, and, if requested, all documents
incorporated or deemed to be incorporated therein by reference and any
exhibits.


 


(g)                                 If
(1) a Shelf Registration Statement is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, deliver to each selling Holder of


 


12





















 


Registrable Notes and a single counsel to such Holders, or each such Participating
Broker-Dealer and their counsel, as the case may be, and the underwriters, if
any, and a single counsel for such underwriters, at the sole expense of the
Company, as many copies of the Prospectus or Prospectuses (including each form
of preliminary prospectus) and each amendment or supplement thereto and any
documents incorporated by reference therein as such Persons may reasonably request;
and, subject to the last paragraph of this Section 5, the Issuers hereby
consent to the use of such Prospectus and each amendment or supplement thereto
(provided the manner of such use complies with any limitations resulting from
any applicable laws, including state securities or “Blue Sky” laws, and subject
to the provisions of this Agreement) by each of the selling Holders of Registrable
Notes or each such Participating Broker-Dealer, as the case may be, and the
underwriters or agents, if any, and dealers (if any), in connection with the
offering and sale of the Registrable Notes or the sale by Participating
Broker-Dealers of the Exchange Notes covered by or pursuant to such Prospectus
and any amendment or supplement thereto.


 


(h)                                 Prior
to any public offering of Registrable Notes or Exchange Notes or any delivery
of a Prospectus contained in the Exchange Offer Registration Statement by any
Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable
Period, use their reasonable best efforts to register or qualify, and to
cooperate with the selling Holders of Registrable Notes or each such
Participating Broker-Dealer, as the case may be, the managing underwriter or
underwriters, if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration or
qualification) of such Registrable Notes or Exchange Notes, as the case may be,
for offer and sale under the securities or Blue Sky laws of such jurisdictions
within the United States as any selling Holder, Participating Broker-Dealer, or
the managing underwriter or underwriters reasonably request in writing; provided,
however, that where Exchange Notes held by Participating Broker-Dealers
or Registrable Notes are offered other than through an underwritten offering,
the Company agrees to cause the Company’s counsel to perform Blue Sky investigations
and file registrations and qualifications required to be filed pursuant to this
Section 5(h), keep each such registration or qualification (or exemption
therefrom) effective during the period such Registration Statement is required
to be kept effective and do any and all other acts or things reasonably
necessary or advisable to enable the disposition in such jurisdictions of such
Exchange Notes or Registrable Notes covered by the applicable Registration
Statement; provided, however, that no Issuer shall be required to
(A) qualify generally to do business in any jurisdiction where it is not
then so qualified, (B) take any action that would subject it to general
service of process in any such jurisdiction where it is not then so subject or (C) subject
itself to taxation in excess of a nominal dollar amount in any such jurisdiction
where it is not then so subject.


 


(i)                                     If
a Shelf Registration Statement is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Notes and the managing
underwriter or underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Notes to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company; and enable such
Registrable Notes to be in such denominations and registered in such names as
the managing underwriter or underwriters, if any, or selling Holders may
reasonably request at least two Business Days prior to any sale of such Registrable
Notes or Exchange Notes.


 


13





















 


(j)                                     Use
their reasonable best efforts to cause the Registrable Notes or Exchange Notes
covered by any Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be reasonably necessary to
enable the seller or sellers thereof or the underwriter or underwriters, if
any, to consummate the disposition of such Registrable Notes or Exchange Notes,
except as may be required solely as a consequence of the nature of such selling
Holder’s business, in which case the Company will cooperate in all reasonable
respects with the filing of such Registration Statement and the granting of
such approvals.


 


(k)                                  If
(1) a Shelf Registration Statement is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, upon the occurrence of any event
contemplated by Section 5(c)(v) or 5(c)(vi) hereof, as promptly
as practicable prepare and (subject to Section 5(a) and the
penultimate paragraph of this Section 5) file with the Commission, at the
sole expense of the Company, a supplement or post-effective amendment to the
Registration Statement or a supplement to the related Prospectus or any
document incorporated or deemed to be incorporated therein by reference, or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Notes being sold thereunder or to the purchasers
of the Exchange Notes to whom such Prospectus will be delivered by a Participating
Broker-Dealer, any such Prospectus will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.


 


(l)                                     Prior
to the effective date of the first Registration Statement relating to the
Registrable Notes, (i) provide the Trustee with certificates for the
Registrable Notes in a form eligible for deposit with The Depository Trust
Company and (ii) provide a CUSIP number for the Registrable Notes.


 


(m)                               In
connection with any underwritten offering of Registrable Notes pursuant to a
Shelf Registration Statement, enter into an underwriting agreement as is
customary in underwritten offerings of debt securities similar to the Notes in
form reasonably satisfactory to the Issuers and take all such other actions as
are reasonably requested by the managing underwriter or underwriters, if any,
in order to expedite or facilitate the registration or the disposition of such
Registrable Notes and, in such connection, (i) make such representations
and warranties to, and covenants with, the underwriters with respect to the
business of the Issuers and their subsidiaries (including any acquired
business, properties or entity, if applicable) and the Registration Statement,
Prospectus and documents, if any, incorporated or deemed to be incorporated by
reference therein, in each case, as are customarily made by issuers to
underwriters in underwritten offerings of debt securities similar to the Notes,
and confirm the same in writing if and when requested in form reasonably
satisfactory to the Issuers; (ii) upon the request of any underwriter, use
their reasonable best efforts to obtain the written opinions of counsel to the
Company and written updates thereof in form, scope and substance reasonably
satisfactory to the managing underwriter or underwriters, addressed to the
underwriters covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
the managing underwriter or underwriters; (iii) upon the request of any
underwriter, use their reasonable best efforts to obtain “cold comfort” letters
and updates thereof in form, scope and substance reasonably satisfactory to the
managing underwriter or underwriters from the independent


 


14





















 


certified public accountants of the Company (and, if necessary, any
other independent certified public accountants of any subsidiary of the Company
or of any business acquired by the Company for which financial statements and
financial data are, or are required to be, included or incorporated by
reference in the Registration Statement), addressed to each of the underwriters,
such letters to be in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with underwritten
offerings of debt securities similar to the Notes, and such other matters as
reasonably requested by the managing underwriter or underwriters as permitted
by the Statement on Auditing Standards No. 72; and (iv) if an underwriting
agreement is entered into, cause the same to contain indemnification provisions
and procedures no less favorable than those set forth in Section 7 hereof
(or such other provisions and procedures acceptable to Holders of a majority in
aggregate principal amount of Registrable Notes covered by such Registration
Statement and the managing underwriter or underwriters or agents, if any) with
respect to all parties to be indemnified pursuant to said Section.  The above shall be done at each closing under
such underwriting agreement, or as and to the extent required thereunder.


 


(n)                                 If
(1) a Shelf Registration Statement is filed pursuant to Section 3 hereof
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell Exchange
Notes during the Applicable Period, make available for inspection by any
selling Holder of such Registrable Notes being sold or each such Participating
Broker-Dealer, as the case may be, any underwriter participating in any such
disposition of Registrable Notes, if any, and any attorney, accountant or other
agent retained by any such selling Holder or each such Participating
Broker-Dealer, as the case may be, or underwriter (collectively, the “Inspectors”),
at the offices where normally kept, during reasonable business hours, all financial
and other records, pertinent corporate documents and instruments of the Company
and its subsidiaries (collectively, the “Records”) as shall be
reasonably necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the appropriate officers, directors and employees
of the Company and its subsidiaries to supply all information reasonably
requested by any such Inspector in connection with such Registration Statement
and Prospectus.  Each Inspector shall
agree in writing that it will keep the Records confidential and not disclose
any Records that the Company determines, in good faith, to be confidential and
that it notifies the Inspectors in writing are confidential unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement or
omission in such Registration Statement or Prospectus, (ii) the release of
such Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, (iii) disclosure of such information is necessary
or advisable in connection with any action, claim, suit or proceeding, directly
or indirectly, involving or potentially involving such Inspector and arising
out of, based upon, relating to, or involving this Agreement or the Purchase
Agreement, or any transactions contemplated hereby or thereby or arising
hereunder or thereunder, or (iv) the information in such Records has been
made generally available to the public other than through an act of such
Inspector in violation of this Section 5(n); provided, however,
that, if practicable, prior notice shall be provided as soon as practicable to
the Issuers of the potential disclosure of any information by such Inspector
pursuant to clause (ii) of this sentence to permit the Issuers to obtain a
protective order or to take other appropriate action to prevent the disclosure
of such information and that such Inspector shall take such actions as are
reasonably necessary to protect the confidentiality of such information (if
practicable) to the extent such action is otherwise not inconsistent with, an
impairment of or in derogation of the rights and interests of the Holder or any
Inspector.


 


15





















 


(o)                                 Provide
an indenture trustee for the Registrable Notes or the Exchange Notes, as the
case may be, and cause the Indenture or the trust indenture provided for in Section 2(b) hereof
to be qualified under the TIA not later than the effective date of the Exchange
Offer or the first Registration Statement relating to the Registrable Notes;
and in connection therewith, cooperate with the trustee under any such
indenture and the Holders of the Registrable Notes or Exchange Notes, as
applicable, to effect such changes to such indenture as may be required for
such indenture to be so qualified in accordance with the terms of the TIA; and
execute, and use their reasonable best efforts to cause such trustee to execute,
all documents as may be required to effect such changes, and all other forms
and documents required to be filed with the Commission to enable such indenture
to be so qualified in a timely manner.


 


(p)                                 Comply
with all applicable rules and regulations of the Commission and make
generally available to the Company’s securityholders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) (i) commencing
at the end of any fiscal quarter in which Registrable Notes or Exchange Notes
are sold to underwriters in a firm commitment or best efforts underwritten offering
and (ii) if not sold to underwriters in such an offering, commencing on
the first day of the first fiscal quarter of the Company after the effective
date of a Registration Statement.


 


(q)                                 Upon
the request of a Holder, upon consummation of the Exchange Offer or a Private
Exchange, use their reasonable best efforts to obtain an opinion of counsel to
the Issuers, in a form customary for underwritten transactions, addressed to
the Trustee for the benefit of all Holders of Registrable Notes participating
in the Exchange Offer or the Private Exchange, as the case may be, that the
Exchange Notes or Private Exchange Notes, as the case may be, and the related
indenture constitute legal, valid and binding obligations of the Issuers,
enforceable against the Issuers in accordance with its respective terms,
subject to customary exceptions and qualifications.


 


(r)                                    If
the Exchange Offer or a Private Exchange is to be consummated, upon delivery of
the Registrable Notes by Holders to the Company (or to such other Person as
directed by the Company) in exchange for the Exchange Notes or the Private
Exchange Notes, as the case may be, mark, or cause to be marked, on such
Registrable Notes that such Registrable Notes are being cancelled in exchange
for the Exchange Notes or the Private Exchange Notes, as the case may be; in no
event shall such Registrable Notes be marked as paid or otherwise satisfied.


 


(s)                                  Cooperate
with each seller of Registrable Notes covered by any Registration Statement and
each underwriter, if any, participating in the disposition of such Registrable
Notes and their respective counsel in connection with any filings required to
be made with the National Association of Securities Dealers, Inc. (the “NASD”).


 


(t)                                    Use
their reasonable best efforts to take all other steps necessary or advisable to
effect the registration of the Exchange Notes and/or Registrable Notes covered
by a Registration Statement contemplated hereby.


 


The Company may require each seller of
Registrable Notes or Exchange Notes as to which any registration is being effected
to furnish to the Issuers such information regarding such seller


 


16





















 


and the distribution of such Registrable
Notes or Exchange Notes as the Company may, from time to time, reasonably
request.  The Issuers may exclude from
such registration the Registrable Notes or Exchange Notes of any seller so long
as such seller fails to furnish such information within a reasonable time after
receiving such request.  Each seller as
to which any Shelf Registration Statement is being effected agrees to furnish
promptly to the Company all information required to be disclosed in order to
make any information previously furnished to the Company by such seller not
materially misleading.


 


If any such Registration Statement refers to
any Holder by name or otherwise as the holder of any securities of the Company,
then such Holder shall have the right to require (i) the insertion therein
of language, in form and substance reasonably satisfactory to such Holder, to
the effect that the holding by such Holder of such securities is not to be construed
as a recommendation by such Holder of the investment quality of the securities
covered thereby and that such holding does not imply that such Holder will
assist in meeting any future financial requirements of the Company, or (ii) in
the event that such reference to such Holder by name or otherwise is not
required by the Securities Act or any similar federal statute then in force,
the deletion of the reference to such Holder in any amendment or supplement to
the Registration Statement filed or prepared subsequent to the time that such
reference ceases to be required.


 


Each Holder of Registrable Notes and each
Participating Broker-Dealer agrees by acquisition of such Registrable Notes or
Exchange Notes that, upon actual receipt of any notice from the Company (x) of
the happening of any event of the kind described in Section 5(c)(ii),
5(c)(iv), 5(c)(v), or 5(c)(vi) hereof, or (y) that the Board of
Directors of the Company (the “Board of Directors”) has resolved that
the Company has a bona fide business purpose for
doing so, then the Company may delay the filing or the effectiveness of the
Exchange Offer Registration Statement or the Shelf Registration Statement (if
not then filed or effective, as applicable) and shall not be required to
maintain the effectiveness thereof or amend or supplement the Exchange Offer
Registration Statement or the Shelf Registration Statement, in all cases, for a
period (a “Delay Period”) expiring upon the earlier to occur of (i) in
the case of the immediately preceding clause (x), such Holder’s or
Participating Broker-Dealer’s receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 5(k) hereof or until it is
advised in writing (the “Advice”) by the Company that the use of the
applicable Prospectus may be resumed, and has received copies of any amendments
or supplements thereto or (ii) in the case of the immediately preceding
clause (y), the date which is the earlier of (A) the date on which
such business purpose ceases to interfere with the Company’s obligations to
file or maintain the effectiveness of any such Registration Statement pursuant
to this Agreement or (B) 60 days after the Company notifies the Holders of
such good faith determination.  There
shall not be more than 60 days of Delay Periods during any 12-month
period.  Each of the Effectiveness Period
and the Applicable Period, if applicable, shall be extended by the number of
days during any Delay Period.  Any Delay
Period will not alter the obligations of the Company to pay Liquidated Damages
under the circumstances set forth in Section 4 hereof.


 


In the event of any Delay Period pursuant to
clause (y) of the preceding paragraph, notice shall be given as soon as practicable
after the Board of Directors makes such a determination of the need for a Delay
Period and shall state, to the extent practicable, an estimate of the duration
of such Delay Period and shall advise the recipient thereof of the agreement of
such Holder provided in the next succeeding sentence.  Each Holder, by his acceptance of any
Registrable Note, agrees that during any Delay Period, each Holder will discontinue
disposition of such Notes or Exchange Notes covered by such Registration
Statement or Prospectus or Exchange Notes to be sold by such Holder or
Participating Broker-Dealer, as the case may be.


 


17





















 


Section 6.                                            Registration
Expenses


 


All fees and expenses incident to the
performance of or compliance with this Agreement by the Issuers shall be borne
by the Issuers, whether or not the Exchange Offer Registration Statement or the
Shelf Registration Statement is filed or becomes effective or the Exchange
Offer is consummated, including, without limitation, (i) all registration
and filing fees (including, without limitation, (A) fees with respect to
filings required to be made with the NASD in connection with an underwritten
offering and (B) fees and expenses of compliance with state securities or
Blue Sky laws (including, without limitation, reasonable fees and disbursements
of one counsel in connection with Blue Sky qualifications of the Registrable
Notes or Exchange Notes and determination of the eligibility of the Registrable
Notes or Exchange Notes for investment under the laws of such jurisdictions
(x) where the holders of Registrable Notes are located, in the case of an
Exchange Offer, or (y) as provided in Section 5(h) hereof, in
the case of Exchange Notes to be sold by a Participating Broker-Dealer during
the Applicable Period)), (ii) printing expenses, including, without
limitation, expenses of printing certificates for Registrable Notes or Exchange
Notes in a form eligible for deposit with The Depository Trust Company and of
printing prospectuses if the printing of prospectuses is requested by the
managing underwriter or underwriters, if any, or by the Holders of a majority
in aggregate principal amount of the Registrable Notes included in any
Registration Statement or in respect of Exchange Notes to be sold by any
Participating Broker-Dealer during the Applicable Period, as the case may be, (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel
for the Issuers and reasonable fees and disbursements of one special counsel
for all of the sellers of Registrable Notes (exclusive of any counsel retained
pursuant to Section 7 hereof), (v) fees and disbursements of all
independent certified public accountants referred to in Section 5(m)(iii) hereof
(including, without limitation, the expenses of any special audit and “cold comfort”
letters required by or incident to such performance), (vi) Securities Act
liability insurance, if the Issuers desire such insurance, (vii) fees and
expenses of all other Persons retained by any of the Issuers, (viii) internal
expenses of the Issuers (including, without limitation, all salaries and
expenses of officers and employees of any of the Issuers performing legal or
accounting duties), (ix) the expense of any audit, (x) the fees and
expenses incurred in connection with the listing of the securities to be
registered on any securities exchange, and the obtaining of a rating of the
securities, in each case, if applicable, and (xi) the expenses relating to
printing, word processing and distributing all Registration Statements, underwriting
agreements, indentures and any other documents necessary in order to comply
with this Agreement.  Notwithstanding the
foregoing or anything to the contrary, each Holder shall pay all underwriting
discounts and commissions of any underwriters with respect to any Registrable
Notes sold by or on behalf of it.


 


Section 7.                                            Indemnification


 


(a)                                  Each
Issuer, jointly and severally, agrees to indemnify and hold harmless each
Holder of Registrable Notes and each Participating Broker-Dealer selling
Exchange Notes during the Applicable Period, each Person, if any, who controls
any such Person within the meaning of Section 15 of the Securities Act or Section 20(a) of
the Exchange Act, the agents, employees, officers and directors of each Holder
and each such Participating Broker-Dealer and the agents, employees, officers
and directors of any such controlling Person (each, a “Participant”)
from and against any and all losses, liabilities, claims, damages and expenses
whatsoever (including, but not limited to, reasonable attorneys’ fees and any
and all reasonable expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all reasonable amounts paid in settlement of any claim
or litigation) (collectively, “Losses”) to which they or any of them may
become


 


18





















 


subject under the Securities Act, the Exchange Act or otherwise insofar
as such Losses (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement (or any amendment thereto) or Prospectus (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by, arising out
of or based upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the case of the Prospectus, in the light of the circumstances under which
they were made, not misleading, provided that (A) the foregoing
indemnity shall not be available to any Participant insofar as such Losses are
caused by any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with information relating to
such Participant furnished to the Company in writing by or on behalf of such
Participant expressly for use therein and (B) with respect to any such
untrue statement or omission made in any preliminary Prospectus, the indemnity
contained in this Section 7(a) (to the extent and only to the extent
that such losses, claims, damages or liabilities resulted from the untrue statement
or omission described in clause (2) below) shall not inure to the benefit
of a Participant if it shall be established that both (1) a copy of the
amended or supplemented Prospectus was not sent or given by such Participant to
the Person asserting any such losses, claims, damages or liabilities and such
Participant was required by law to so send or give such Prospectus to such
Person and (2) the untrue statement or omission in the preliminary
Prospectus was corrected in the amended or supplemented Prospectus, unless, in
either case, such failure to deliver the amended or supplemented Prospectus was
a result of noncompliance by an Issuer with any of its covenants or obligations
in this Agreement.


 


(b)                                 Each
Participant agrees, severally and not jointly, to indemnify and hold harmless
each Issuer, each Person, if any, who controls any Issuer within the meaning of
Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, and each of their respective agents, employees, officers and
directors and the agents, employees, officers and directors of any such
controlling Person from and against any Losses to which they or any of them may
become subject under the Securities Act, the Exchange Act or otherwise insofar
as such Losses (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement (or any amendment thereto) or Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by, arising out
of or based upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the case of the Prospectus, in the light of the circumstances under which
they were made, not misleading, in each case to the extent, but only to the
extent, that any such Loss arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in reliance
upon and in conformity with information relating to such Participant furnished
in writing to the Company by or on behalf of such Participant expressly for use
therein; provided, however, that with respect to any such untrue
statement or omission made in any preliminary Prospectus, the indemnity
contained in this Section 7(b) (to the extent and only to the extent
that such losses, claims, damages or liabilities resulted from an untrue
statement or omission in the preliminary Prospectus that was corrected in the
amended or supplemented Prospectus) shall not inure to the benefit of an Issuer
if it shall be established that (1) both (A) a copy of the amended or
supplemented Prospectus was sent or given by such Participant to the Person
asserting any such losses, claims, damages or liabilities and (B) the
untrue statement or omission in the preliminary Prospectus was corrected in the
amended or supplemented Prospectus or (2) such failure to deliver the
amended or supplemented Prospectus was a result of noncompliance by an Issuer
with any of its covenants or obligations in this Agreement.


 


19





















 


(c)                                  Promptly
after receipt by an indemnified party under subsection 7(a) or 7(b) above
of notice of the commencement of any action, suit or proceeding (collectively,
an “action”), such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection,
notify each party against whom indemnification is to be sought in writing of
the commencement of such action (but the failure so to notify an indemnifying
party shall not relieve such indemnifying party from any liability that it may
have under this Section 7 except to the extent that it has been prejudiced
in any material respect by such failure or from any liability which it otherwise
may have).  In case any such action is
brought against any indemnified party, and it notifies an indemnifying party of
the commencement of such action, the indemnifying party will be entitled to
participate in such action, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense of such action with
counsel reasonably satisfactory to such indemnified party.  Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such action, but the fees and expenses of such counsel shall be
at the expense of such indemnified party or parties unless (i) the employment
of such counsel shall have been authorized in writing by the indemnifying
parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) the indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them that are different
from or additional to those available to one or all of the indemnifying parties
(in which case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any
of which events such reasonable fees and expenses of counsel shall be borne by
the indemnifying parties; provided, however, that the
indemnifying party will not be liable for the fees and expenses of more than
one counsel (together with appropriate local counsel) designated by the
indemnified party or parties at any time for all indemnified parties in connection
with any one action or separate but similar or related actions arising out of
the same general allegations or circumstances. 
An indemnifying party shall not be liable for any settlement of any
claim or action effected without its written consent, which consent may not be
unreasonably withheld.  No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.


 


(d)                                 In
order to provide for contribution in circumstances in which the indemnification
provided for in this Section 7 is for any reason held to be unavailable
from the indemnifying party, or is insufficient to hold harmless a party
indemnified under this Section 7, each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of such aggregate
Losses (i) in such proportion as is appropriate to reflect the relative
benefits received by each indemnifying party, on the one hand, and each
indemnified party, on the other hand, from the sale of the Notes to the Initial
Purchasers or the resale of the Registrable Notes by such Holder, as applicable,
or (ii) if such allocation is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to above but also the relative fault of each indemnified party, on the one
hand, and each indemnifying party, on the other hand, in connection with the
statements or omissions that resulted in such Losses, as well as any other
relevant equitable considerations.  The
relative benefits received by the Issuers, on the one hand, and each
Participant, on the other hand, shall be deemed to be in the same proportion as
(x) the total proceeds from the sale of the Notes to the Initial Purchasers
(net of discounts and commissions but before deducting expenses) received by
the Issuers are to (y) the total net profit received by such


 


20





















 


Participant in connection with the sale of the Registrable Notes.  The relative fault of the parties shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Issuers or such
Participant and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission or alleged
statement or omission.


 


(e)                                  The
parties agree that it would not be just and equitable if contribution pursuant to
this Section 7 were determined by pro rata allocation or by any other
method of allocation that does not take into account the equitable
considerations referred to above. 
Notwithstanding the provisions of this Section 7, (i) in no
case shall any Participant be required to contribute any amount in excess of
the amount by which the net profit received by such Participant in connection
with the sale of the Registrable Notes exceeds the amount of any damages that
such Participant has otherwise been required to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission and (ii) 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. 
For purposes of this Section 7, each Person, if any, who controls
any Participant within the meaning of Section 15 of the Act or Section 20(a) of
the Exchange Act and each director, officer, employee and agent of such
Participant shall have the same rights to contribution as such Participant, and
each Person, if any, who controls any Issuer within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act and each director,
officer, employee and agent of such Issuer or Person who controls such Issuer
shall have the same rights to contribution as such Issuer.  Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action against such
party in respect of which a claim for contribution may be made against another
party or parties under this Section 7, notify such party or parties from
whom contribution may be sought, but the omission to so notify such party or
parties shall not relieve the party or parties from whom contribution may be
sought from any obligation it or they may have under this Section 7 or otherwise,
except to the extent that it has been prejudiced in any material respect by
such failure; provided, however, that no additional notice shall
be required with respect to any action for which notice has been given under
this Section 7 for purposes of indemnification.  Anything in this section to the contrary
notwithstanding, no party shall be liable for contribution with respect to any
action or claim settled without its written consent; provided, however,
that such written consent was not unreasonably withheld.


 


Section 8.                                            Rules 144
and 144A


 


The Company covenants that it will file the
reports required to be filed by it under the Securities Act and the Exchange
Act and the rules and regulations adopted by the Commission thereunder in
a timely manner in accordance with the requirements of the Securities Act and
the Exchange Act and, if at any time the Company is not required to file such reports,
it will, upon the request of any Holder or beneficial owner of Registrable
Notes, make available such information necessary to permit sales pursuant to Rule 144A
under the Securities Act, in each case for so long as any Registrable Notes
remain outstanding.  The Issuers further
covenant for so long as any Registrable Notes remain outstanding that they will
take such further action as any Holder of Registrable Notes may reasonably
request from time to time to enable such Holder to sell Registrable Notes
without registration under the Securities Act within the limitation of the
exemptions provided by (a) Rule 144(k) and Rule 144A under the
Securities Act, as such Rules may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the Commission.


 


21





















 


Section 9.                                            Underwritten
Registrations


 


If any of the Registrable Notes covered by
any Shelf Registration Statement are to be sold in an underwritten offering,
the investment banker or investment bankers and manager or managers that will
manage the offering will be selected by the Holders of a majority in aggregate
principal amount of such Registrable Notes included in such offering and shall
be reasonably acceptable to the Company.


 


No Holder of Registrable Notes may
participate in any underwritten registration hereunder if such Holder does not (a) agree
to sell such Holder’s Registrable Notes on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) complete and execute all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.


 


Section 10.                                      Miscellaneous


 


(a)                                  No
Inconsistent Agreements.  The Issuers
have not entered, as of the date hereof, and shall not enter, after the date of
this Agreement, into any agreement with respect to any of their securities that
is inconsistent with the rights granted to the Holders of Registrable Notes in
this Agreement or otherwise conflicts with the provisions hereof.  The rights granted to the Holders hereunder
do not conflict with and are not inconsistent with, in any material respect,
the rights granted to the holders of any of the Issuers’ other issued and
outstanding securities under any such agreements.  The Issuers have not entered and will not
enter into any agreement with respect to any of their securities which will
grant to any Person piggy-back registration rights with respect to any Registration
Statement.


 


(b)                                 Adjustments
Affecting Registrable Notes.  The
Issuers shall not, directly or indirectly, take any action with respect to the
Registrable Notes as a class that would adversely affect the ability of the
Holders of Registrable Notes to include such Registrable Notes in a
registration undertaken pursuant to this Agreement.


 


(c)                                  Amendments
and Waivers.  The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given except pursuant to a
written agreement duly signed and delivered by (I) the Issuers and (II)(A) the
Holders of not less than a majority in aggregate principal amount of the then
outstanding Registrable Notes and (B) in circumstances that would
adversely affect the Participating Broker-Dealers, the Participating
Broker-Dealers holding not less than a majority in aggregate principal amount
of the Exchange Notes held by all Participating Broker-Dealers; provided,
however, that Section 7 and this Section 10(c) may not be
amended, modified or supplemented except pursuant to a written agreement duly
signed and delivered by each Holder and each Participating Broker-Dealer (including
any Person who was a Holder or Participating Broker-Dealer of Registrable Notes
or Exchange Notes, as the case may be, disposed of pursuant to any Registration
Statement) adversely affected by any such amendment, modification, supplement
or waiver.  Notwithstanding the foregoing,
a waiver or consent to depart from the provisions hereof with respect to a
matter that relates exclusively to the rights of Holders of Registrable Notes
whose securities are being sold pursuant to a Registration Statement and that
does not directly or indirectly affect, impair, limit or compromise the rights
of other Holders of Registrable Notes may be given by Holders of at least a
majority in aggregate principal amount of the Registrable Notes being sold
pursuant to such Registration Statement.


 


22





















 


(d)                                 Notices.  All notices and other communications
(including, without limitation, any notices or other communications to the
Trustee) provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier or telecopier:


 


(i)                                     if
to a Holder of the Registrable Notes or any Participating Broker-Dealer, at the
most current address of such Holder or Participating Broker-Dealer, as the case
may be, set forth on the records of the registrar under the Indenture.


 


(ii)                                  if
to the Issuers, at the address as follows:


 


Meritage Homes Corporation

8501 East Princess Drive

Suite 290

Scottsdale, Arizona  85255

Telephone:  (480) 998-8700

Fax:  (480) 998-9178

Attention:  Larry W. Seay


 


With a copy to:


 


Snell &
Wilmer L.L.P.

One Arizona Center

400 E. Van Buren Street

Phoenix, Arizona  85004-2223

Telephone:  (602) 382-6000

Fax:  (602) 382-6070

Attention:  Steven D. Pidgeon, Esq.


 


(iii)                               if
to the Initial Purchasers, at the address as follows:


 


UBS Securities LLC.

677 Washington Blvd.

Stanford, Connecticut  06901

Facsimile No.:  (203) 719-0680

Attention:  Legal and Compliance
Department


 


With a copy
to:


 


Cahill Gordon &
Reindel LLP

80 Pine Street

New York, New York  10005

Telephone:  (212) 701-3000

Fax:  (212) 269-5420

Attention:  Daniel J. Zubkoff, Esq.


 


All such notices and communications shall be
deemed to have been duly given:  when
delivered by hand, if personally delivered; five Business Days after being
deposited in the mail, postage


 


23





















 


prepaid, if mailed; when receipt is
acknowledged by the recipient’s telecopier machine, if telecopied; and on the
next Business Day, if timely delivered to an air courier guaranteeing overnight
delivery.


 


Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person giving the same to
the Trustee at the address and in the manner specified in such Indenture.


 


(e)                                  Guarantors.  So long as any Registrable Notes remain
outstanding, the Issuers shall cause each Person that becomes a guarantor of
the Notes under the Indenture to execute and deliver a counterpart to this
Agreement which subjects such Person to the provisions of this Agreement as a
Guarantor.  Each of the Guarantors agrees
to join the Company in all of its undertakings hereunder to effect the Exchange
Offer for the Exchange Notes and the filing of any Shelf Registration Statement
required hereunder.


 


(f)                                    Successors
and Assigns.  This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties hereto, the Holders and the Participating Broker-Dealers;
provided, however, that this Agreement shall not inure to the benefit of or be
binding upon a successor or assign of a Holder unless and to the extent such
successor or assign holds Registrable Notes.


 


(g)                                 Counterparts.  This Agreement may be executed by facsimile
and in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.


 


(h)                                 Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the meaning
hereof.


 


(i)                                     Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.


 


(j)                                     Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their reasonable best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction.


 


(k)                                  Securities
Held by the Company or Its Affiliates. 
Whenever the consent or approval of Holders of a specified percentage of
Registrable Notes is required hereunder, Registrable Notes held by the Company
or any of its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.


 


(l)                                     Third-Party
Beneficiaries.  Holders and
beneficial owners of Registrable Notes and Participating Broker-Dealers are
intended third-party beneficiaries of this Agreement, and this


 


24





















 


Agreement may be enforced by such Persons.  No other Person is intended to be, or shall
be construed as, a third-party beneficiary of this Agreement.


 


(m)                               Attorneys’
Fees.  As between the parties to this
Agreement, in any action or proceeding brought to enforce any provision of this
Agreement, or where any provision hereof is validly asserted as a defense, the
successful party shall be entitled to recover reasonable attorneys’ fees
actually incurred in addition to its costs and expenses and any other available
remedy.


 


(n)                                 Entire
Agreement.  This Agreement, together
with the Purchase Agreement and the Indenture, is intended by the parties as a
final and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein and therein and any and
all prior oral or written agreements, representations, or warranties,
contracts, understandings, correspondence, conversations and memoranda between
the Holders on the one hand and the Issuers on the other, or between or among
any agents, representatives, parents, subsidiaries, affiliates, predecessors in
interest or successors in interest with respect to the subject matter hereof
and thereof are merged herein and replaced hereby.


 


25





















 


IN WITNESS WHEREOF, the parties have executed
this Agreement as of the date first written above.


 


	
   

  	
  MERITAGE HOMES CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MONTEREY
  HOMES ARIZONA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  PASEO CROSSING, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Meritage
  Homes of Arizona, Inc., its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MONTEREY
  HOMES CONSTRUCTION, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  PASEO CONSTRUCTION, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Meritage
  Homes Construction, Inc., its Sole Member

  



 


S-1





















 


	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  HOMES OF ARIZONA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  HOMES CONSTRUCTION, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH-TEXAS
  GP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH-TEXAS
  LP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LEGACY/MONTEREY
  HOMES L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas
  GP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  



 


S-2





















 


	
   

  	
  MERITAGE
  HOMES OF CALIFORNIA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LEGACY
  OPERATING COMPANY, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Meritage
  Holdings, L.L.C., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Legacy/Monterey
  Homes L.P., its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas
  GP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HULEN PARK
  VENTURE, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Legacy/Monterey
  Homes L.P., its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas
  GP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  



 


S-3





















 


	
   

  	
  MERITAGE
  HOLDINGS, L.L.C.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Legacy/Monterey
  Homes L.P., its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas
  GP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH-TEXAS GP
  II, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH
  HOMES-TEXAS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas GP
  II, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH-TEXAS LP
  II, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH-HOMES
  NEVADA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  



 


S-4





















 


	
   

  	
  MTH-CAVALIER,
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Monterey Homes
  Construction, Inc., its Sole

  Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MTH GOLF,
  LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Meritage Homes
  Construction, Inc., its Sole

  Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  



 


S-5





















 


	
   

  	
  LEGACY-HAMMONDS
  MATERIALS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Meritage
  Holdings, L.L.C., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Legacy/Monterey
  Homes L.P., its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MTH-Texas
  GP, Inc., its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  HOMES COLORADO, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MERITAGE
  HOMES OF FLORIDA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Larry W.
  Seay

  
	
   

  	
   

  	
  Name:               Larry W. Seay

  
	
   

  	
   

  	
  Title:                     Vice
  President-Secretary

  



 


S-6





















 


	
   

  	
  UBS
  SECURITIES LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert
  Crowley

  
	
   

  	
   

  	
  Name:  Robert Crowley

  
	
   

  	
   

  	
  Title:  Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  [Signature
  illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CITIGROUP GLOBAL MARKETS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen Cunningham

  
	
   

  	
   

  	
  Name:  Stephen Cunningham

  
	
   

  	
   

  	
  Title:  Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  J.P. MORGAN
  SECURITIES INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  [Signature
  illegible]

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


S-7





















 


Schedule A


 


Guarantors


 


1.               Monterey Homes Arizona, Inc.


2.               Meritage Paseo Crossing, LLC


3.               Monterey Homes Construction, Inc.


4.               Meritage Paseo Construction, LLC


5.               Meritage Homes of Arizona, Inc.


6.               Meritage Homes Construction, Inc.


7.               MTH-Texas GP, Inc.


8.               MTH-Texas LP, Inc.


9.               Legacy/Monterey Homes L.P.


10.         Meritage Homes of California, Inc.


11.         Legacy Operating Company, L.P.


12.         Hulen Park Venture, LLC


13.         Meritage Holdings, L.L.C.


14.         MTH-Texas GP II, Inc.


15.         MTH Homes-Texas, L.P.


16.         MTH-Texas LP II, Inc.


17.         MTH-Homes Nevada, Inc.


18.         MTH-Cavalier, LLC


19.         MTH Golf, LLC


20.         Legacy-Hammonds Materials, L.P.


21.         Meritage Homes of Colorado, Inc.


22.         Meritage Homes of Florida, Inc.