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Exhibit 4.45  


 
 

REGISTRATION RIGHTS AGREEMENT    
  


        THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered into as of March 21, 2003, by and
between MANDALAY RESORT GROUP, a Nevada corporation (the "Company") and MERRILL LYNCH & CO., MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED and BANC OF AMERICA SECURITIES LLC (the "Initial Purchasers"). 


        This
Agreement is made pursuant to the Purchase Agreement, dated March 17, 2003 (the "Purchase Agreement"), between the Company, as
issuer of the Floating Rate Convertible Senior Debentures due 2033 (the "Debentures"), and the Initial Purchasers, which provides for, among other
things, the sale by the Company to the Initial Purchasers of the aggregate principal amount of Debentures specified therein. In order to induce the Initial Purchasers to enter into the Purchase
Agreement, the Company has agreed to provide the registration rights set forth in this Agreement. The execution of this Agreement is a condition to the closing under the Purchase Agreement. 


        The
Company agrees with the Initial Purchasers, (i) for their benefit as Initial Purchasers and (ii) for the benefit of the beneficial owners (including the Initial
Purchasers) from time to time of the Debentures, and the beneficial owners from time to time of the Underlying Common Stock (as defined herein) issuable upon conversion of the Debentures (each of the
foregoing a "Holder" and together the "Holders"), as follows: 


        SECTION
1.    Definitions.    Capitalized terms used but not defined herein shall have their respective meanings as
set forth in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings: 



        "Affiliate:" With respect to any specified person, an "affiliate," as defined in Rule 144, of such person. 


        "Business Day:" Each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which banking institutions in The City of New
York are authorized or obligated by law or executive order to close. 


        "Common Stock:" The Common Stock, $0.012/3 par value, of the Company and any other shares of common stock as may constitute
"Common Stock" for purposes of the Indenture, including the Underlying Common Stock. 


        "Company:" See the first paragraph hereof. 


        "Conversion Rate:" Conversion Rate shall have the meaning assigned to such term in the Indenture. 


        "Damages Accrual Period:" See Section 2(e) hereof. 


        "Damages Payment Date:" Each March 21, June 21, September 21 and December 21. 


        "Debentures:" See the second paragraph hereof. 


        "Deferral Notice:" See Section 3(h) hereof. 


        "Deferral Period:" See Section 3(h) hereof. 


        "Effectiveness Deadline Date:" See Section 2(a) hereof. 



        "Effectiveness Period:" The period beginning on the Issue Date and ending on the earlier of (i) the sale pursuant to the Initial
Shelf Registration Statement of all Registrable Securities thereunder and (ii) the expiration of the holding period applicable to such Registrable Securities held by persons not Affiliates of
the Company under Rule 144(k) under the Securities Act. 


        "Event:" See Section 2(e) hereof. 






 




        "Event Date:" See Section 2(e) hereof. 


        "Event Termination Date:" See Section 2(e) hereof. 


        "Exchange Act:" The Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder. 



        "Filing Deadline Date:" See Section 2(a) hereof. 


        "Holder:" See the third paragraph hereof. 


        "Indenture:" The senior indenture, dated as of the date hereof, between the Company and The Bank of New York, as trustee, pursuant to
which the Debentures are being issued. 


        "Initial Purchasers:" See the first paragraph of this Agreement. 


        "Initial Shelf Registration Statement:" See Section 2(a) hereof. 


        "Issue Date:" means March 21, 2003. 


        "Liquidated Damages Amount:" See Section 2(e) hereof. 


        "Material Event:" See Section 3(h) hereof. 



        "Notice and Questionnaire:" A written notice delivered to the Company containing substantially the information called for by the Selling
Securityholder Notice and Questionnaire attached as Annex A to the Offering Memorandum of the Company, dated March 17, 2003, relating to the Debentures. 


        "Notice Holder:" On any date, any Holder that has delivered a Notice and Questionnaire to the Company on or prior to such date. 


        "Prospectus:" The prospectus included in any Registration Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 415 promulgated under the Securities Act), as amended or supplemented
by any amendment or prospectus supplement, including post-effective amendments, and all materials incorporated by reference in such Prospectus. 


        "Purchase Agreement:" See the second paragraph hereof. 


        "Record Date:" With respect to any Damages Payment Date relating to any Debenture as to which any Liquidated Damages Amount has accrued,
(i) the 15th day immediately preceding such Damages Payment Date if the Damages Accrual Period has not ended or (ii) the date of the end of the Damages Accrual Period. 


        "Record Holder:" With respect to any Damages Payment Date relating to any Debenture as to which any Liquidated Damages Amount has accrued,
the registered holder of such Debenture. 


        "Registrable Securities:" The Securities, until such securities have been converted or exchanged and, at all times subsequent to any such
conversion or exchange, any securities into or for which such securities have been converted or exchanged, and any security issued with respect thereto upon any stock dividend, split, merger or
similar event until, in the case of any such security, the earliest of (i) its effective registration under the Securities Act and resale in accordance with the Registration Statement covering
it, (ii) expiration of the holding period that would be applicable thereto under Rule 144(k) were it not held by an Affiliate of the Company, (iii) its sale to the public pursuant
to Rule 144 or (iv) the expiration of the Effectiveness Period. 


        "Registration Expenses:" See Section 5 hereof. 



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        "Registration Statement:" Any registration statement of the Company that covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and supplements to such registration statement, including post-effective amendments, all exhibits, and all materials
incorporated by reference in such registration statement. 


        "Restricted Securities:" As this term is defined in Rule 144. 



        "Rule 144:" Rule 144 under the Securities Act, as such rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC. 


        "Rule 144A:" Rule 144A under the Securities Act, as such rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC. 


        "SEC:" The Securities and Exchange Commission or any successor thereto. 


        "Securities:" Collectively means the Debentures and the Underlying Common Stock. 


        "Securities Act:" The Securities Act of 1933, as amended, and the rules and regulations promulgated by the SEC thereunder. 


        "Shelf Registration Statement:" See Section 2(a) hereof. 


        "Subsequent Shelf Registration Statement:" See Section 2(b) hereof. 


        "TIA:" The Trust Indenture Act of 1939, as amended. 


        "Trustee:" The Bank of New York (or any successor entity) as trustee under the Indenture. 


        "Underlying Common Stock:" The Common Stock issuable upon conversion of the Debentures. 




        SECTION
2.    Shelf Registration.    



        (a)  The
Company shall prepare or cause to be prepared and shall file or cause to be filed with the SEC within one hundred and twenty (120) days after the Issue Date
(the "Filing Deadline Date") a Registration Statement for an offering to be made on a delayed or continuous basis pursuant to Rule 415 of the
Securities Act (a "Shelf Registration Statement") registering the resale from time to time by Holders thereof of all of the Registrable Securities (the
"Initial Shelf Registration Statement"). The Initial Shelf Registration Statement shall be on Form S-3 or another appropriate form
permitting registration of such Registrable Securities for resale by such Holders in accordance with the methods of distribution elected by the Holders and set forth in the Initial Shelf Registration
Statement; provided, that in no event will such method(s) of distribution take the form of an underwritten offering of the Registrable Securities without the prior agreement of the Company. The
Company shall use its reasonable efforts to cause the Initial Shelf Registration Statement to be declared effective under the Securities Act by the date (the "Effectiveness
Deadline Date") one hundred and eighty (180) days after the Issue Date, and to keep the Initial Shelf Registration Statement (or any Subsequent Shelf Registration
Statement) continuously effective under the Securities Act until the expiration of the Effectiveness Period, subject to the rights of the Company under Section 3(h) to create a Deferral Period.
At the time the Initial Shelf Registration Statement is declared effective, each Holder that became a Notice Holder on or prior to the date ten (10) Business Days prior to such time of
effectiveness shall be named as a selling securityholder in the Initial Shelf Registration Statement and the related Prospectus in such a manner as to permit such Holder to deliver such Prospectus to
purchasers of Registrable Securities in accordance with applicable law. 


        (b)  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, the Company shall use its reasonable efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof, and in any event shall within thirty (30) days of such
cessation of 



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effectiveness amend the Shelf Registration Statement in a manner reasonably expected by the Company to obtain the withdrawal of the order suspending the effectiveness thereof, or file an additional
Shelf Registration Statement covering all of the Securities that as of the date of such filing are Registrable Securities (a "Subsequent Shelf Registration
Statement"). If a Subsequent Shelf Registration Statement is filed, the Company shall use its reasonable efforts to cause the Subsequent Shelf Registration Statement to become
effective as promptly as is practicable after such filing and to keep such Registration Statement (or subsequent Shelf Registration Statement) continuously effective until the end of the Effectiveness
Period. 


        (c)  The
Company shall supplement and amend the Shelf Registration Statement if required by the rules, regulations or instructions applicable to the registration form used by
the Company for such Shelf Registration Statement if required by the Securities Act or, to the extent to which the Company does
not reasonably object, as reasonably requested by the Initial Purchasers or by the Trustee on behalf of the registered Holders. 



        (d)  Each
Holder of Registrable Securities agrees that if such Holder wishes to sell Registrable Securities pursuant to a Shelf Registration Statement and related Prospectus,
it will do so only in accordance with this Section 2(d) and with Section 3(h). Each Holder of Registrable Securities wishing to sell Registrable Securities pursuant to a Shelf
Registration Statement and related Prospectus agrees to deliver a Notice and Questionnaire to the Company at least eight (8) but not more than twenty (20) Business Days prior to any
intended distribution of Registrable Securities under the Shelf Registration Statement. From and after the date the Initial Shelf Registration Statement is declared effective, the Company shall, as
promptly as reasonably practicable after the date a Notice and Questionnaire is delivered, (i) if required by applicable law, file with the SEC a post-effective amendment to the
Shelf Registration Statement or prepare and, if required by applicable law, file a supplement to the related Prospectus or a supplement or amendment to any document incorporated therein by
reference or file any other document required by the SEC so that the Holder delivering such Notice and Questionnaire is named as a selling securityholder in the Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder to deliver such Prospectus to purchasers of the Registrable Securities in accordance with applicable law and, if the Company shall
file a post-effective amendment to the Shelf Registration Statement, use its reasonable efforts to cause such post-effective amendment to be declared effective under the
Securities Act as promptly as is practicable; (ii) provide such Holder copies of any documents filed pursuant to Section 2(d)(i); and (iii) notify such Holder as promptly as
practicable after the effectiveness under the Securities Act of any post-effective amendment filed pursuant to Section 2(d)(i); provided, that if such Notice and Questionnaire is
delivered during a Deferral Period, the Company shall so inform the Holder delivering such Notice and Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Deferral Period in accordance with Section 3(h). Notwithstanding anything contained herein to the contrary, the Company shall be under no obligation to
name any Holder that is not a Notice Holder as a selling securityholder in any Registration Statement or related Prospectus; provided, however, that any Holder that becomes a Notice Holder pursuant to
the provisions of Section 2(d) of this Agreement (whether or not such Holder was a Notice Holder at the time the Registration Statement was initially declared effective) shall be named as a
selling securityholder in the Registration Statement or related Prospectus subject to and in accordance with the requirements of this Section 2(d). 


        (e)  The
parties hereto agree that the Holders of Registrable Securities will suffer damages, the extent of which are not feasible to ascertain as of the date hereof, if
(i) the Initial Shelf Registration Statement has not been filed on or prior to the Filing Deadline Date, (ii) the Initial Shelf Registration Statement has not been declared effective
under the Securities Act on or prior to the Effectiveness Deadline Date or (iii) the aggregate duration of Deferral Periods in any 



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period exceeds the number of days permitted in respect of such period pursuant to Section 3(h) hereof (each of the events of a type described in any of the foregoing clauses (i) through
(iii) are individually referred to herein as an "Event," and the Filing Deadline Date in the case of clause (i), the Effectiveness
Deadline Date in the case of clause (ii) and the date on which the aggregate duration of Deferral Periods in any period exceeds the number of days permitted by Section 3(h) hereof in the
case of clause (iii), being referred to herein as an "Event Date"). Events shall be deemed to continue until the "Event
Termination Date," which shall be the following dates with respect to the respective types of Events: the date the Initial Shelf Registration Statement is filed in the case of
an Event of the type described in clause (i), the date the Initial Shelf Registration Statement is declared effective under the
Securities Act in the case of an Event of the type described in clause (ii) and termination of the Deferral Period that caused the limit on the aggregate duration of Deferral Periods in a
period set forth in Section 3(h) to be exceeded in the case of the commencement of an Event of the type described in clause (iii). 



        Accordingly,
commencing on (and including) any Event Date and ending on (but excluding) the next date on which there are no Events that have occurred and are continuing (a
"Damages Accrual Period"), the Company agrees to pay, as liquidated damages and not as a penalty, additional interest (the
"Liquidated Damages Amount") payable on the Damages Payment Dates to Record Holders of the then outstanding Debentures that are Registrable Securities
accruing, for each portion of such Damages Accrual Period beginning on and including a Damages Payment Date (or, in respect of the first time that the Liquidation Damages Amount is to be paid to
Record Holders on a Damages Payment Date as a result of the occurrence of any particular Event, beginning on and including the Event Date) and ending on but excluding the first to occur of
(A) the date of the end of the Damages Accrual Period or (B) the next Damages Payment Date, at a rate per annum equal to one-quarter of one percent (0.25%) for the first
90-day period from the Event Date, and thereafter at a rate per annum equal to one-half of one percent (0.50%) of the aggregate principal amount of such Debentures determined
as of the Record Date; provided, that any Liquidated Damages Amount accrued with respect to any Debenture or portion thereof called for redemption on a redemption date or converted into Underlying
Common Stock on a conversion date prior to the Damages Payment Date, shall, in any such event, be paid instead to the Holder who submitted such Debenture or portion thereof for redemption or
conversion on the applicable redemption date or conversion date, as the case may be, on such date (or promptly following the conversion date, in the case of conversion). 



        Notwithstanding
the foregoing, no Liquidated Damages Amounts shall accrue as to any Underlying Common Stock at any time nor as to any Debenture from and after the earlier of
(x) the date such security is no longer a Registrable Security and (y) the expiration of the Effectiveness Period. Notwithstanding the occurrence of multiple concurrent Events, the rate
of accrual of the Liquidated Damages Amount with respect to any period shall not exceed the rate provided for in the preceding paragraph. Following the cure of all Events requiring the payment by the
Company of Liquidated Damages Amounts to the Holders of Registrable Securities pursuant to this Section, the accrual of Liquidated Damages Amounts will cease (without in any way limiting the effect of
any subsequent Event requiring the payment of Liquidated Damages Amount by the Company). 



        The
Trustee shall be entitled, on behalf of Holders of Debentures or Underlying Common Stock, to seek any available remedy for the enforcement of this Agreement, including, with respect
to Debentures, for the payment of any Liquidated Damages Amount. Notwithstanding the foregoing, the parties agree that the sole remedy for a violation of the terms of this Agreement shall be such
liquidated damages. 


        All
of the Company's obligations set forth in this Section 2(e) that are outstanding with respect to any Registrable Security at the time such Security ceases to be a Registrable
Security 



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shall survive until such time as all such obligations with respect to such security have been satisfied in full (notwithstanding termination of this Agreement pursuant to Section 8(j)). 


        The
parties hereto agree that the liquidated damages provided for in this Section 2(e) constitute a reasonable estimate of the damages that may be incurred by Record Holders of
the then outstanding Debentures that are Registrable Securities by reason of the failure of the Shelf Registration Statement to be filed or declared effective or available for effecting resales of
Registrable Securities in accordance with the provisions hereof. 




        SECTION
3.    Registration Procedures.    In connection with the registration obligations of the Company under
Section 2 hereof, the Company shall: 



        (a)  before
filing any Registration Statement or Prospectus or any amendments or supplements thereto with the SEC, furnish to the Initial Purchasers copies of all such
documents proposed to be filed and give reasonable consideration to such comments as the Initial Purchasers reasonably shall propose within three (3) Business Days of the delivery of such
copies to the Initial Purchasers; 


        (b)  subject
to Section 3(h), (i) prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the applicable period specified in Section 2(a), (ii) cause the related Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) under the Securities Act and (iii) use its reasonable
efforts to comply with the provisions of the Securities Act applicable to it with respect to the disposition of all securities covered by such Registration Statement during the Effectiveness Period in
accordance with the intended methods of disposition by the sellers thereof set forth in such Registration Statement as so amended or such Prospectus as so supplemented; 


        (c)  as
promptly as practicable give notice to the Notice Holders and the Initial Purchasers (i) when any Prospectus, Prospectus supplement, Registration Statement or
post-effective amendment to a Registration Statement (other than any such Prospectus supplement, Registration Statement or post-effective amendment to a Registration Statement
which is filed solely to name additional selling security holders or to reflect any other matters that are not of a material nature) has been filed with the SEC and, with respect to a Registration
Statement or any post-effective amendment, when the same has been declared effective, (ii) of any request, following the effectiveness of the Initial Shelf Registration Statement
under the Securities Act, by the SEC or any other federal or state governmental authority for amendments or supplements to any Registration Statement or related Prospectus or for additional
information, (iii) of the issuance by the SEC or any other federal or state governmental authority of any stop order suspending the effectiveness of any Registration Statement or the initiation
or threatening of any proceedings for that purpose and (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification
of any of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, which notice may, at the discretion of the Company (or as
required pursuant to Section 3(h)), state that it constitutes a Deferral Notice, in which event the provisions of Section 3(h) shall apply; 


        (d)  use
reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of a Registration Statement or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction in which they have been qualified for sale, in either case at the earliest possible
moment or, if any such order or suspension is made effective during any Deferral Period, at the earliest possible moment after the expiration of such Deferral Period; 



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        (e)  as
promptly as reasonably practicable furnish to each Notice Holder and the Initial Purchasers, upon their request and without charge, at least one (1) conformed
copy of the Registration Statement and any amendment thereto, including financial statements, but excluding schedules, all documents incorporated or deemed to be incorporated therein by reference and
all exhibits (unless requested in writing to the Company by such Notice Holder or the Initial Purchasers, as the case may be); 



        (f)    during
the Effectiveness Period, deliver to each Notice Holder in connection with any sale of Registrable Securities pursuant to a Registration Statement, without
charge, as many copies of the Prospectus or Prospectuses relating to such Registrable Securities (including each preliminary prospectus) and any amendment or supplement thereto as such Notice Holder
may reasonably request; and the Company hereby consents (except during such periods that a Deferral Notice is outstanding and has not been revoked) to the use of such Prospectus or each amendment or
supplement thereto by each Notice Holder in connection with any offering and sale of the Registrable Securities covered by such Prospectus or any amendment or supplement thereto in the manner set
forth therein; 


        (g)  subject
to Section 3(h), (i) prior to any public offering of the Registrable Securities pursuant to the Shelf Registration Statement, use all reasonable
efforts to register or qualify or cooperate with the Notice Holders in connection with the registration or qualification (or exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United States as any Notice Holder reasonably requests in writing (which request may be included in
the Notice and Questionnaire), (ii) prior to any public offering of the Registrable Securities pursuant to the Shelf Registration Statement, use all reasonable efforts to keep each such
registration or qualification (or exemption therefrom) effective during the Effectiveness Period in connection with such Notice Holder's offer and sale of Registrable Securities pursuant to such
registration or qualification (or exemption therefrom) and (iii) do any and all other acts or things necessary to enable the disposition in such jurisdictions of such Registrable Securities in
the manner set forth in the relevant Registration Statement and the related Prospectus; provided, that the Company will not be required to (A) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it is not otherwise qualified but for this Agreement or (B) take any action that would subject it to general service of process in suits or to taxation in
any such jurisdiction where it is not then so subject; 


        (h)  upon
(i) the issuance by the SEC of a stop order suspending the effectiveness of the Shelf Registration Statement or the initiation of proceedings with respect to
the Shelf Registration Statement
under Section 8(d) or 8(e) of the Securities Act, (ii) the occurrence of any event or the existence of any fact as a result of which any Registration Statement shall 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 misleading, or any Prospectus shall 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 (each a "Material Event") or (iii) the occurrence or existence of any corporate development that, in the discretion of the
Company, makes it appropriate to suspend the availability of the Shelf Registration Statement and the related Prospectus, (A) in the case of clause (ii) above, subject to the next
sentence, as promptly as practicable prepare and file a post-effective amendment to such Registration Statement or a supplement to the related Prospectus or any document
incorporated therein by reference or file any other required document that would be incorporated by reference into such Registration Statement and Prospectus so that such Registration Statement does
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 



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not misleading, and such Prospectus does 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, as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, and, in the case
of a post-effective amendment to a Registration Statement, subject to the next sentence, use reasonable efforts to cause it to be declared effective as promptly as is reasonably
practicable and (B) give notice to the Notice Holders that the availability of the Shelf Registration Statement is suspended (a "Deferral
Notice") and, upon receipt of any Deferral Notice, each Notice Holder agrees not to sell any Registrable Securities pursuant to the Registration Statement until such Notice
Holder's receipt of copies of the supplemented or amended Prospectus provided for in clause (A) above, or until it is advised in writing by the Company that the Prospectus may be used, and has
received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in such Prospectus. The Company will use reasonable efforts to ensure that the use
of the Prospectus may be resumed (x) in the case of clause (i) above, as promptly as practicable, (y) in the case of clause (ii) above, as soon as, in the sole judgment of
the Company, public disclosure of such Material Event would not be prejudicial or contrary to the interests of the Company or, if necessary to avoid unreasonable burden or expense, as soon as
reasonably practicable thereafter and (z) in the case of clause (iii) above, as soon as, in the sole judgment of the Company, such suspension is no longer appropriate. The period during
which the availability of the Registration Statement and any Prospectus is suspended (the "Deferral Period") shall, without the Company incurring any
obligation to pay liquidated damages pursuant to Section 2(e), not exceed forty-five (45) days in any three (3) month period or one hundred and twenty
(120) days in any twelve (12) month period; 


        (i)    comply
with all applicable rules and regulations of the SEC and make generally available to its securityholders earning statements (whether audited or unaudited)
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than forty-five
(45) days after the end of any twelve (12) month period (or ninety (90) days after the end of any twelve (12) month period if such period is a fiscal year) commencing on
the first day of the first fiscal quarter of the Company commencing after the effective date of a Registration Statement, which statements shall cover said twelve (12) month periods; 



        (j)    cooperate
with each Notice Holder to facilitate the timely preparation and delivery of certificates representing Registrable Securities sold pursuant to a Registration
Statement and cause such Registrable Securities to be in such denominations as are permitted by the Indenture and registered in such names as such Notice Holder may request in writing at least two
(2) Business Days prior to any sale of such Registrable Securities; 


        (k)  provide
a CUSIP number for all Registrable Securities covered by each Registration Statement not later than the effective date of such Registration Statement and provide
the Trustee for the Debentures and the transfer agent for the Common Stock with certificates for the Registrable Securities that are in a form eligible for deposit with The Depository Trust Company; 


        (l)    make
reasonable effort to provide such information as is required for any filings required to be made with the National Association of Securities Dealers, Inc.; 


        (m)  upon
(i) the filing of the Initial Shelf Registration Statement and (ii) the effectiveness of the Initial Shelf Registration Statement, announce the same,
in each case by release to Reuters Economic Services and Bloomberg Business News or other comparable means of dissemination that shall make such information known publicly; and 



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        (n)  cause
the Indenture to be qualified under the TIA not later than the effective date of any Registration Statement and in connection therewith, cooperate with the Trustee
to effect such changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the TIA and execute, and use its reasonable efforts to cause the Trustee
to execute, all documents as may be required to effect such changes, and all other forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a timely manner. 




        SECTION
4.    Holder's Obligations.    Each Holder agrees, by acquisition of the Registrable Securities, that no
Holder of Registrable Securities shall be entitled to sell any of such Registrable Securities pursuant to a Registration Statement or to receive a Prospectus relating thereto, unless such Holder has
furnished the Company with a Notice and Questionnaire as required pursuant to Section 2(d) hereof (including the information required to be included in such Notice and Questionnaire) and the
information set forth in the next sentence. Each Notice Holder agrees promptly to furnish to the Company all information required to be disclosed in order to make the information previously furnished
to the Company by such Notice Holder not misleading and any other information regarding such Notice Holder and the distribution of such Registrable Securities as may be required to be disclosed in the
Registration Statement under applicable law or pursuant to SEC comments. Each Holder further agrees, following termination of the Effectiveness Period and within ten (10) Business Days of any
request by the Company, to notify the Company of the amount of Registrable Securities sold pursuant to the Registration Statement and, in the absence of a response, the Company may assume that all of
the Holder's Registrable Securities were so sold. 


        SECTION
5.    Registration Expenses.    The Company shall bear all fees and expenses incurred in connection with the
performance by the Company of its obligations under Sections 2 and 3 of this Agreement, whether or not any of the Registration Statements are declared effective. Such fees and expenses shall include,
without limitation, (i) all registration and filing fees (including, without limitation, reasonable fees and disbursements of the counsel specified in the next sentence in connection with Blue
Sky qualifications of the Registrable Securities under the laws of such jurisdictions as the Notice Holders of a majority of the Registrable Securities being sold pursuant to a Registration Statement
may designate), (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities in a form eligible for deposit with The Depository Trust
Company), (iii) duplication expenses relating to copies of any Registration Statement or Prospectus delivered to any Holders hereunder, (iv) fees and disbursements of counsel for the
Company in connection with the Shelf Registration Statement and (v) reasonable fees and disbursements of the Trustee and its counsel and of the registrar and transfer agent for the Common
Stock. In addition, the Company shall bear or reimburse the Notice Holders for the reasonable fees and disbursements of one firm of legal counsel for the Holders incurred in reviewing and commenting
upon the Shelf Registration Statement prior to its effectiveness, which shall, upon the written consent of the Initial Purchasers (which shall not be unreasonably withheld), be a nationally recognized
law firm experienced in securities law matters designated by the Company. In addition, the Company shall pay the internal expenses of the Company (including, without
limitation, all salaries and expenses of officers and employees performing legal or accounting duties), the expense of any annual audit, the fees and expenses incurred in connection with the listing
of the Registrable Securities on any securities exchange on which the same securities of the Company are then listed and the fees and expenses of any person, including special experts, retained by the
Company. 


        SECTION
6.    Indemnification; Contribution.    



        (a)  The
Company agrees to indemnify and hold harmless each of the Initial Purchasers and each Holder of Registrable Securities and each person, if any, who controls any of
the Initial 



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Purchasers or any Holder of Registrable Securities within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, as follows: 



          (i)  against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, resulting from any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading or resulting from any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; 


        (ii)  against
any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, provided that (subject to Section 6(d) below) any such settlement is effected with the prior written consent of the Company; and 


        (iii)  subject
to Section 6(c) below, against any and all expense whatsoever (including the fees and disbursements of counsel), as reasonably incurred in
investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under clause (i) or (ii) above; 




provided,
however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with written information furnished to the Company
by or on behalf of the Initial Purchasers or any Holder of Registrable Securities and each person, if any, who controls any of the Initial Purchasers or any such Holder of Registrable Securities
expressly for use in the Registration Statement (or any amendment thereto), or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto); provided, further, that this
indemnity agreement shall not apply to any loss, liability, claim, damage or expense (1) arising from an offer or sale of Registrable Securities occurring during a Deferral Period, if a Notice
Holder was given a Deferral Notice or (2) a Holder fails to deliver at or prior to the written confirmation of sale, the most recent Prospectus, as amended or supplemented, and such Prospectus,
as amended or supplemented, would have corrected such untrue statement or alleged untrue statement of a material fact or would have included the omitted or allegedly omitted statement of a material
fact. 


        (b)  In
connection with any Registration Statement in which a Holder, including, without limitation, any of the Initial Purchasers, of Registrable Securities is
participating, in furnishing information relating to such Holder of Registrable Securities to the Company in writing expressly for use in such Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto, the Holders of such Registrable Securities agree, severally and not jointly, to indemnify and hold harmless each of the Initial Purchasers and each
person, if any, who controls any of the Initial Purchasers within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and the Company, its directors
and each officer who signed such Registration Statement and each person, if any, who controls the Company within the meaning of either such Section, against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with 



10





 





respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), or any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Holder of Registrable Securities (which also
acknowledges the indemnity provisions herein) or any person, if any, who controls any such Holder of Registrable Securities expressly for use in the Registration Statement (or any amendment thereto)
or such preliminary prospectus or the Prospectus (or any amendment or supplement thereto). 


        The
Initial Purchasers agree to indemnify and hold harmless the Company, the Holders of Registrable Securities, and each person, if any, who controls the Company or any Holder of
Registrable Securities within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in
the Registration Statement (or any amendment thereto), or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by the Initial Purchasers expressly for use in the Registration Statement (or any amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto). 


        (c)  Each
indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced
as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of this indemnity agreement. The indemnifying party, upon request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for (A) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Initial Purchasers, Holders of
Registrable Securities, and all persons, if any, who control the Initial Purchasers or Holders of Registrable Securities within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, collectively or (B) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Company, its directors and each
officer who signed the Registration Statement and each person, if any, who controls the Company within the meaning of either such Section, and that all such fees and expenses shall be reimbursed as
they are incurred. No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (x) includes an unconditional release
of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim 



11





 





and (y) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party. 


        (d)  If
at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying
party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is entered into
more than forty-five (45) days after receipt by such indemnifying party of aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such
settlement at least thirty (30) days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with
such request prior to the date of such settlement. Notwithstanding the immediately preceding sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall not be liable for any settlement of the nature contemplated by Section 6(a)(ii) effected without its
consent if such indemnifying party (A) reimburses such indemnified party in accordance with such request to the extent it considers such request to be reasonable and (B) provides written
notice to the indemnified party stating the indemnifying party's basis for its belief that any unpaid balance of such request is unreasonable, in each case prior to the date of such settlement. 


        (e)  If
the indemnification provided for in this Section 6 is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any
losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, in
such proportion as is appropriate to reflect the relative fault of the indemnifying party or parties on the one hand and of the indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. 


        The
relative fault of the Company on the one hand and the Holders of the Registrable Securities or the Initial Purchasers on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or by the
Holders of the Registrable Securities or the Initial Purchasers and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 



        The
parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 6(e) were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred to above in this Section 6(e). The aggregate amount of losses, liabilities, claims, damages, and expenses
incurred by an indemnified party and referred to above in this Section 6(e) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission. 


        Notwithstanding
the provisions of this Section 6, neither the Holder of any Registrable Securities nor the Initial Purchasers, shall be required to indemnify or contribute any
amount in excess of the amount by which the total price at which the Registrable Securities sold by such Holder of Registrable Securities or by the Initial Purchasers, as the case may be, and
distributed to the public were offered to the public exceeds the amount of any damages that such Holder of 



12





 





Registrable Securities or the Initial Purchasers has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. 


        No
person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. 


        For
purposes of this Section 6(e), each person, if any, who controls any of the Initial Purchasers or any Holder of Registrable Securities within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as such Initial Purchasers or such Holder, and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as the Company. 




        SECTION
7.    Information Requirements.    The Company covenants that, if at any time before the end of the
Effectiveness Period the Company is not subject to the reporting requirements of the Exchange Act, the Company will cooperate with any Holder of Registrable Securities and take such further reasonable
action as any Holder of Registrable Securities may reasonably request in writing (including, without limitation, making such reasonable representations as any such Holder may reasonably request), all
to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by
Rule 144 and Rule 144A under the Securities Act and customarily taken in connection with sales pursuant to such exemptions; provided, however, that any legal opinion required by any
trustee or transfer agent shall be the responsibility of such Holder. Upon the written request of any Holder of Registrable Securities, the Company shall deliver to such Holder a written statement as
to whether it has complied with such filing requirements, unless such a statement has been included in the Company's most recent report required to be filed and filed pursuant to Section 13 or
Section 15(d) of Exchange Act. Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to require the Company to register any of its securities under any section of the
Exchange Act. 


        SECTION
8.    Miscellaneous; No Conflicting Agreements.    The Company is not, as of the date hereof, a party to, nor
shall the Company, on or after the date of this Agreement, enter into any agreement with respect to its securities that conflicts with the rights granted to the Holders of Registrable Securities in
this Agreement. The Company represents and warrants that the rights granted to the Holders of Registrable Securities hereunder do not conflict in any material respect with the rights granted to the
holders of the Company securities under any other agreements. 



        (a)    Amendments and Waivers.    The provisions of this Agreement, including the provisions of this sentence, may not
be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the Company has obtained the written consent of Holders of a majority of
the then outstanding Underlying Common Stock constituting Registrable Securities (with Holders of Debentures deemed to be the Holders, for purposes of this Section, of the number of outstanding shares
of Underlying Common Stock into which such Debentures are or would be convertible or exchangeable as of the date on which such consent is requested). 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 Securities whose securities are being sold pursuant to a Registration
Statement and that does not directly or indirectly affect the rights of other Holders of Registrable Securities may be given by Holders of at least a majority of the Registrable Securities being sold
by such Holders pursuant to such Registration Statement; provided, that the provisions of this sentence may not be amended, modified, or supplemented except in accordance with the provisions of the
immediately preceding sentence. Each Holder of Registrable Securities outstanding at the time of any such amendment, modification, supplement, waiver or consent or thereafter shall be bound by any
such 



13





 


amendment, modification, supplement, waiver or consent effected pursuant to this Section 8(a), whether or not any notice, writing or marking indicating such amendment, modification,
supplement, waiver or consent appears on the Registrable Securities or is delivered to such Holder. 



        (b)    Notices.    All notices and other communications provided for or permitted hereunder shall be made in writing
by hand delivery, telecopier, courier guaranteeing overnight delivery or by first-class mail, return receipt requested, and shall be deemed given (i) when made, if made by hand delivery,
(ii) upon confirmation, if made by telecopier, (iii) one (1) Business Day after being deposited with such courier, if made by overnight courier or (iv) on the date
indicated on the notice of receipt, if made by first-class mail, to the parties as follows: 



        (A)  if
to a Holder of Registrable Securities that is not a Notice Holder, at the address for such Holder then appearing in the Register (as defined in the Indenture); 


        (B)  if
to a Notice Holder, at the most current address given by such Holder to the Company in a Notice and Questionnaire or any amendment thereto; 


        (C)  if
to the Company, to: 




Mandalay
Resort Group

3950 Las Vegas Boulevard South

Las Vegas, NV 89119

Attention: Yvette Landau

Telecopier No.: (702) 632-6723 


and 





        (D)  if
to the Initial Purchasers, to: 




Merrill
Lynch & Co.,

Merrill Lynch, Pierce, Fenner & Smith Incorporated

Banc of America Securities LLC

c/o Merrill Lynch

4 World Financial Center

New York, New York 10080

Attention: Todd Bernick

Telecopy No.: (212) 449-1642 






or
to such other address as such person may have furnished to the other persons identified in this Section 8(c) in writing in accordance herewith. 



        (c)    Approval of Holders.    Whenever the consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company or its affiliates (as such term is defined in Rule 405 under the Securities Act) (other than the Initial Purchasers
or subsequent Holders of Registrable Securities if such subsequent Holders are deemed to be such affiliates solely by reason of their holdings of such Registrable Securities) shall not be counted in
determining whether such consent or approval was given by the Holders of such required percentage. 



        (d)    Successors and Assigns.    This Agreement shall inure to the benefit of and be binding upon the successors,
assigns and transferees of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders;  provided that nothing herein shall be deemed to permit
any assignment, transfer or other disposition of Registrable Securities in violation of the terms
of the Purchase Agreement or the Indenture. If any transferee of any holder shall acquire Registrable Securities, in any manner, whether by operation of law or otherwise, such Registrable Securities
shall be held to all of the terms of this Agreement, and by taking and 



14





 





holding such Registrable Securities such person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement and, if applicable, the
Purchase Agreement, and such person shall be entitled to receive the benefits hereof. 


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


        (f)    Interpretation.    The headings in this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning hereof. Any ambiguities in this Agreement shall not be construed against the draftsman. 


        (g)    Governing Law.    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. 


        (h)    Severability.    If any term, provision, covenant or restriction of this Agreement is held 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 thereby, and the parties hereto shall use their 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, it being intended that all of the rights and privileges of the parties shall be enforceable to the fullest extent permitted by law. 



        (i)    Entire Agreement.    This Agreement is intended by the parties as a final expression of their agreement and is
intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and the registration rights granted by the
Company with respect to the Registrable Securities. Except as provided in the Purchase Agreement, there are no restrictions, promises, warranties or undertakings, other than those set forth or
referred to herein, with respect to the registration rights granted by the Company with respect to the Registrable Securities. This Agreement supersedes all prior agreements and undertakings among the
parties solely with respect to such registration rights. 



        (j)    Termination.    This Agreement and the obligations of the parties hereunder shall terminate upon the end of the
Effectiveness Period, except for any liabilities or obligations under Sections 4, 5 or 6 hereof and the obligations to make payments of and provide for Liquidated Damages under Section 2(e)
hereof to the extent such damages accrue prior to the end of the Effectiveness Period, each of which shall remain in effect in accordance with its terms. 



15












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



	 	 	 	 	MANDALAY RESORT GROUP
	

 	
 	

 	
 	

By:	
 	

/s/  GLENN SCHAEFFER      
 Glenn Schaeffer
	Accepted as of the date first above written:	 	 	 	 
	

MERRILL LYNCH & CO.	
 	

 	
 	

 
	MERRILL LYNCH, PIERCE, FENNER & SMITH

                            INCORPORATED	 	 	 	 
	

By:	
 	

/s/  TODD BERNICK      
 Todd Bernick
 Director	
 	

 	
 	

 
	

 	
 	
Authorized Signatory	
 	

 	
 	

 
	

BANC OF AMERICA SECURITIES LLC	
 	

 	
 	

 
	

By:	
 	

/s/  JIM FREEMAN      
 Jim Freeman
 Vice President	
 	

 	
 	

 
	

 	
 	
Authorized Signatory	
 	

 	
 	

 











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REGISTRATION RIGHTS AGREEMENT