**EXHIBIT10.13**

 

 

REGISTRATION RIGHTS AGREEMENT

 

Dated as of March 2, 2005

 

by and among

 

JACOBS ENTERTAINMENT, INC.,

 

THE GUARANTORSnamed herein

 

and

 

THE PURCHASERSnamed herein

 

 

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$23,000,000

 

11 7/8% SENIOR SECURED NOTESDUE 2009

 

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TABLE OFCONTENTS

 
| 1.     | Definitions                |                                         |
|--------|----------------------------|----------------------------------------------|
|   |                       |                                         |
| 2.     | Exchange  Offer            |                                         |
|   |                       |                                         |
| 3.     | Shelf Registration         |                                         |
|   |                       |                                         |
| 4.     | Additional Interest        |                                         |
|   |                       |                                         |
| 5.     | Registration Procedures    |                                         |
|   |                       |                                         |
| 6.     | Registration Expenses      |                                         |
|   |                       |                                         |
| 7.     | Indemnification            |                                         |
|   |                       |                                         |
| 8.     | Rules 144 and 144A    |                                         |
|   |                       |                                         |
| 9.     | Underwritten Registrations |                                         |
|   |                       |                                         |
| 10.    | Miscellaneous              |                                         |
|   |                       |                                         |   |
|   | (a)                        | Remedies                                     |   |
|   | (b)                        | No Inconsistent Agreements                   |   |
|   | (c)                        | Amendments and Waivers                       |   |
|   | (d)                        | Notices                                      |   |
|   | (e)                        | Successors and Assigns                       |   |
|   | (f)                        | Counterparts                                 |   |
|   | (g)                        | Headings                                     |   |
|   | (h)                        | Governing  Law                               |   |
|   | (i)                        | Severability                                 |   |
|   | (j)                        | Notes Held by any Issuer or their Affiliates |   |
|   | (k)                        | Third Party Beneficiaries                    |   |
|   | (l)                        | Entire  Agreement                            |   |
|   | (m)                        | Joint and Several Obligations                |   |

 

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REGISTRATIONRIGHTS AGREEMENT

 

ThisRegistration Rights Agreement (the “Agreement”) is made and entered intoas of March 2, 2005, by and among Jacobs Entertainment, Inc., aDelaware corporation (the “Company”), the Guarantors (as defined below)and the purchasers set forth on Schedule A hereto (the “Purchasers”).

 

This Agreementis entered into in connection with that certain Note Purchase Agreement, dated March 2,2005, by and among the Company, the Guarantors and the Purchasers (the “NotePurchase Agreement”) relating to the sale by the Company to the Purchasersof $23,000,000 aggregate principal amount of the Company’s 11 7/8 % SeniorSecured Notes due 2009 (the “Notes”) and the unconditional guaranteethereof by the Guarantors on a joint and several basis (the “Guarantee”).  In order to induce the Purchasers to enterinto the Note Purchase Agreement, the Issuers (as defined below) have agreed toprovide the registration rights set forth in this Agreement for the benefit ofthe holders of Registrable Notes (as defined below), including, without limitation,the Purchasers.  The execution anddelivery of this Agreement is a condition to the Purchasers’ obligation topurchase the Notes under the Note Purchase Agreement.

 

The partieshereby agree as follows:

 

1.                  Definitions

 

As used inthis Agreement, the following terms shall have the following meanings:

 

AdditionalInterest:  See Section 4(a).

 

Advice:  See the last paragraph of Section 5.

 

Agreement:  See the preamble to this Agreement.

 

ApplicablePeriod:  See Section 3(b).

 

Business Day:  A day that is not a Saturday, a Sunday,or a day on which banking institutions in New York, New York are required to beclosed.

 

Commission:  The Securities and Exchange Commission.

 

Company:  See the first introductory paragraph to thisAgreement.

 

EffectivenessDate:  The 210thday after the Issue Date, in the case of the Exchange Registration Statement,and, in the case of the Initial Shelf Registration, the 90th dayafter the filing of the Initial Shelf Registration.

 

EffectivenessPeriod:  See Section 3(a).

 

Event Date:  See Section 4(b).

 

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Exchange Act:  The Securities Exchange Act of 1934, asamended, and the rules and regulations of the Commission promulgatedthereunder.

 

Exchange Notes:  See Section 2 (a).

 

Exchange Offer:  See Section 2(a).

 

ExchangeRegistration Statement:  See Section 2 (a).

 

Filing Date:  The 120th day after the Issue Date(regardless of whether the actual filing precedes such date).

 

Guarantee:  See the second introductory paragraph to thisAgreement.

 

Guarantors:  Black Hawk Gaming & DevelopmentCompany, Inc., a Colorado corporation, Black Hawk/Jacobs Entertainment, aColorado limited liability company, Gold Dust West Casino, Inc., a Nevadacorporation, Gilpin Hotel Venture, a Colorado joint venture, Gilpin Ventures, Inc.,a Colorado corporation, Jalou II Inc., a Louisiana corporation, Winner’s ChoiceCasino, Inc., a Louisiana corporation, Diversified Opportunities GroupLtd., an Ohio limited liability company, Jalou L.L.C., a Louisiana limitedliability company, Houma Truck Plaza & Casino, L.L.C., a Louisianalimited liability company, Jalou-Cash’s L.L.C., a Louisiana limited liabilitycompany, JACE, Inc., a Louisiana corporation, Lucky Magnolia Truck Stopand Casino, L.L.C., a Louisiana limited liability company, Bayou Vista TruckPlaza and Casino, L.L.C., a Louisiana limited liability company, Raceland TruckPlaza and Casino, L.L.C., a Louisiana limited liability company, ColonialHoldings, Inc., a Virginia corporation, Stansley Racing Corp., a Virginiacorporation, Colonial Downs, L.P., a Virginia limited partnership, ColonialDowns, L.L.C., a Virginia limited liability company, JRJ Properties, L.L.C., aLouisiana limited liability company, Jalou Breaux Bridge, LLC, a Louisianalimited liability company, Jalou Eunice, LLC, a Louisiana limited liabilitycompany, and Jalou of Jefferson, LLC, a Louisiana limited liability company.

 

Holder:  Any registered holder of Registrable Notes.

 

IndemnifiedPerson:  See Section 7(c).

 

IndemnifyingPerson:  See Section 7(c).

 

Indenture:  The Indenture, dated as of February 8,2002, by and among Jacobs Entertainment, Inc. (formerly known as Gameco, Inc.),the Subsidiary Guarantors (as defined therein), and Wells Fargo Bank Minnesota,National Association, as trustee, pursuant to which the Notes are being issued,as amended or supplemented from time to time in accordance with the termsthereof.

 

Initial ShelfRegistration: See Section 3(a).

 

Inspectors:  See Section 5(o).

 

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Issue Date:  The date on which the Notes were sold to thePurchasers pursuant to the Note Purchase Agreement.

 

Issuers:  The Company and the Guarantors, collectively.

 

NASD:  National Association of Securities Dealers, Inc.

 

Note PurchaseAgreement:  Seethe second introductory paragraph to this Agreement.

 

Notes:  See the second introductory paragraph to thisAgreement.

 

Participant:  See Section 7(a).

 

Person:  Any individual, corporation, partnership,limited liability company, joint venture, association, joint stock company,trust, unincorporated organization or government (including any agency orpolitical subdivision thereof).

 

PotentialMaterial Event: (i) An event or circumstance which occurs and is continuing as aresult of which any Shelf Registration, any related prospectus or any documentincorporated therein by reference as then amended or supplemented or proposedto be filed would, in the good faith determination of the Board of Directors ofthe Company, contain an untrue statement of a material fact or omit to state amaterial fact necessary in order to make the statements therein, in light ofthe circumstances under which they were made, not misleading, and (ii) either(a) the Board of Directors of the Company determines in good faith thatthe disclosure of such event at such time would have a material adverse effecton the Company’s business, operations or prospects or (b) the disclosureotherwise relates to a material business transaction or development which hasnot yet been publicly disclosed.

 

Prospectus:  The prospectus included in any RegistrationStatement (including, without limitation, any prospectus subject tocompletion and a prospectus that includes any information previously omittedfrom a prospectus filed as part of an effective registration statement inreliance upon Rule 430A promulgated under the Securities Act), as amendedor supplemented by any prospectus supplement, with respect to the terms of theoffering of any portion of the Registrable Notes covered by such RegistrationStatement, and all other amendments and supplements to the Prospectus,including post-effective amendments, and all material incorporated by referenceor deemed to be incorporated by reference in such Prospectus.

 

Purchasers:  See the preamble to this Agreement.

 

Records:  See Section 5(o).

 

RegistrableNotes:  EachNote upon original issuance thereof and at all times subsequent thereto, eachExchange Note as to which Section 2(c)(iii) hereof is applicable uponoriginal issuance thereof and at all times subsequent thereto until, in thecase of any such Note or Exchange Note, as the case may be, the earliest tooccur of (i) a Registration Statement covering such Note or Exchange Note,as the case may be, has been declared effective by the Commission

 

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and such Noteor Exchange Note, as the case may be, has been disposed of in accordance withsuch effective Registration Statement, (ii) such Note or Exchange Note, asthe case may be, is sold in compliance with Rule 144, (iii) in thecase of any Note, such Note has or could have been exchanged pursuant to theExchange Offer for an Exchange Note or Exchange Notes which may be resoldwithout restriction under federal securities laws, or (iv) such Note orExchange Note, as the case may be, ceases to be outstanding for purposes of theIndenture.

 

RegistrationStatement:  Anyregistration statement of the Company, including, but not limited to, theExchange Registration Statement, that covers any of the Registrable Notespursuant to the provisions of this Agreement, including the Prospectus,amendments and supplements to such registration statement, includingpost-effective amendments, all exhibits, and all material incorporated byreference or deemed to be incorporated by reference in such registrationstatement.

 

Rule 144:  Rule 144 under the Securities Act, assuch Rule may be amended from time to time, or any similar rule (otherthan Rule 144A) or regulation hereafter adopted by the Commissionproviding for offers and sales of securities made in compliance therewithresulting in offers and sales by subsequent holders that are not affiliates ofan issuer of such securities being free of the registration and prospectusdelivery requirements of the Securities Act.

 

Rule 144A:  Rule 144A under the Securities Act, assuch Rule may be amended from time to time, or any similar rule (otherthan Rule 144) or regulation hereafter adopted by the Commission.

 

Rule 415:  Rule 415 under the Securities Act, assuch Rule may be amended from time to time, or any similar rule orregulation hereafter adopted by the Commission.

 

Securities Act:  The Securities Act of 1933, as amended, andthe rules and regulations of the Commission promulgated thereunder.

 

Shelf Notice:  See Section 2(c).

 

ShelfRegistration: See Section 3(b).

 

SuspensionPeriod:  See Section 5.

 

SubsequentShelf Registration: See Section 3(b).

 

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

 

Trustee:  The trustee under the Indenture and, ifexistent, the trustee under any indenture governing the Exchange Notes.

 

Underwrittenregistration or underwritten offering:  A registration in which securities of one ormore of the Issuers are sold to an underwriter for reoffering to the public.

 

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2.                  Exchange Offer

 

(a)                         Eachof the Issuers agrees to file with the Commission no later than the FilingDate, an offer to exchange (the “Exchange Offer”) any and all of theRegistrable Notes for a like aggregate principal amount of debt securities ofthe Company which are identical in all material respects to the Notes (the “ExchangeNotes”) (and which are entitled to the benefits of the Indenture (otherthan such changes to the Indenture as are necessary to comply with any requirementsof the Commission to effect or maintain the qualification thereof under theTIA), except that the Exchange Notes shall have been registered pursuant to aneffective Registration Statement under the Securities Act and shall contain norestrictive legend thereon.  The ExchangeOffer shall be registered under the Securities Act on the appropriateform (the “Exchange Registration Statement”) and shall comply withall applicable tender offer rules and regulations under the ExchangeAct.  Each of the Issuers agrees to useits best efforts to (x) cause the Exchange Registration Statement to bedeclared effective under the Securities Act on or before the EffectivenessDate; (y) keep the Exchange Offer open for at least 30 Business Days (orlonger if required by applicable law) after the later of the date on which (i) theExchange Offer is first mailed to Purchasers and (ii) the ExchangeRegistration Statement is declared effective by the Commission and launched;and (z) consummate the Exchange Offer on or prior to the 60th dayfollowing the date on which the Exchange Registration Statement is declaredeffective by the Commission.  If aftersuch Exchange Registration Statement is initially declared effective by theCommission, the Exchange Offer or the issuance of the Exchange Notes thereunderis interfered with by any stop order, injunction or other order or requirementof the Commission or any other governmental agency or court, such ExchangeRegistration Statement shall be deemed not to have become effective forpurposes of this Agreement and the Company shall immediately provide notice tothe Trustee that the Exchange Registration Statement is no longereffective.  Each Holder who participatesin the Exchange Offer will be required to represent that any Exchange Notesreceived by it will be acquired in the ordinary course of its business, that atthe time of the consummation of the Exchange Offer such Holder will have noarrangement or understanding with any Person to participate in the distributionof the Exchange Notes, that such Holder is not an affiliate of any Issuerwithin the meaning of the Securities Act, and any additional representationsthat in the written opinion of counsel to the Issuers are necessary underthen-existing interpretations of the Commission in order for the ExchangeRegistration Statement to be declared effective.  Upon consummation of the Exchange Offer inaccordance with this Section 2, the Issuers shall have no furtherobligation to register Registrable Notes other than in respect of any ExchangeNotes as to which clause 2(b)(iii) hereof applies.

 

In connectionwith the Exchange Offer, the Issuers shall:

 

(1)                                 mailto each Holder a copy of the Prospectus forming part of the ExchangeRegistration Statement, together with an appropriate letter of transmittal andrelated documents;

 

(2)                                 utilizethe services of a depositary for the Exchange Offer with an address in theBorough of Manhattan, The City of New York, which may be the Trustee or anaffiliate thereof;

 

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(3)                                 permitHolders to withdraw tendered Registrable Notes at any time prior to the closeof business, New York time, on the last Business Day on which the ExchangeOffer shall remain open; and

 

(4)                                 otherwisecomply in all material respects with all applicable laws.

 

As soon aspracticable after the close of the Exchange Offer, the Issuers shall:

 

(1)                                 acceptfor exchange all Registrable Notes validly tendered and not validly withdrawnpursuant to the Exchange Offer;

 

(2)                                 deliverto the Trustee for cancellation all Registrable Notes so accepted for exchange;and

 

(3)                                 causethe Trustee to authenticate and deliver promptly to each Holder tendering suchRegistrable Notes or Exchange Notes, as the case may be, equal in principalamount to the Notes of such Holder so accepted for exchange.

 

The ExchangeNotes may be issued under (i) the Indenture or (ii) an indentureidentical in all material respects to the Indenture, which in either event willprovide that the Exchange Notes will not be subject to the transferrestrictions set forth in the Indenture and that the Exchange Notes and theNotes, if any, will vote and consent together on all matters as one class andthat none of the Exchange Notes or the Notes, if any, will have the right to voteor consent as a separate class on any matter.

 

(b)                        If,(i) because of any change in law or in currently prevailinginterpretations of the staff of the Commission, the Company is not permitted toeffect an Exchange Offer, (ii) the Exchange Offer is not consummatedwithin 255 days of the Issue Date, or (iii) in the case of any Holder thatparticipates in the Exchange Offer (and validly tenders and does not withdrawits Registrable Notes prior to the expiration thereof), such Holder does notreceive Exchange Notes on the date of the exchange that may be sold withoutrestriction under federal securities laws (other than due solely to the statusof such Holder as an affiliate of any Issuer within the meaning of theSecurities Act) and so notifies the Company within 30 days following theconsummation of the Exchange Offer (and provides a reasonable basis for itsconclusions), in the case of each of clauses (i)-(iii), then the Issuersshall promptly deliver to the Holders and the Trustee written notice thereof(the “Shelf Notice”) and shall file a Shelf Registration pursuant to Section 3.

 

3.                  Shelf Registration

 

If a ShelfNotice is delivered as contemplated by Section 2(c), then:

 

(a)                         ShelfRegistration.  The Issuers shall aspromptly as reasonably practicable file with the Commission a RegistrationStatement for an offering to be made on a continuous basis pursuant to Rule 415covering all of the Registrable Notes (the “Initial Shelf Registration”).  If the Issuers shall not have filed theExchange Registration Statement, each of the Issuers shall file with theCommission the Initial Shelf Registration on or prior to the Filing

 

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Date and shalluse its best efforts to cause such Initial Shelf Registration to be declaredeffective under the Securities Act on or prior to the Effectiveness Date.  Otherwise, each of the Issuers shall filewith the Commission the Initial Shelf Registration within 120 days of thedelivery of the Shelf Notice and shall use its best efforts to cause such ShelfRegistration to be declared effective under the Securities Act on or prior tothe Effectiveness Date.  The Issuersshall file the Initial Shelf Registration on Form S-3 if they are eligibleto do so. Otherwise, the Issuers shall file such Initial Shelf Registration on Form S-1or another appropriate form permitting registration of such Registrable Notesfor 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 securitiesother than the Registrable Notes to be included in any Shelf Registration.  Each of the Issuers shall use its bestefforts to keep the Initial Shelf Registration continuously effective under theSecurities Act until the date which is 24 months from the Issue Date (or,if Rule 144(k) under the Securities Act is amended to permit unlimitedresales by non-affiliates within a lesser period, such lesser period) (subjectto extension pursuant to the last and penultimate paragraphs of Section 5hereof) (the “Effectiveness Period”) or such shorter period ending when (i) allRegistrable Notes covered by the Initial Shelf Registration have been sold inthe manner set forth and as contemplated in the Initial Shelf Registration or (ii) aSubsequent Shelf Registration covering all of the Registrable Notes has beendeclared effective under the Securities Act.

 

(b)                        SubsequentShelf Registrations.  If the InitialShelf Registration or any Subsequent Shelf Registration ceases to be effectivefor any reason at any time during the Effectiveness Period (other than becauseof the sale of all of the securities registered thereunder), the Company shallimmediately provide notice to the Trustee that such Initial Shelf Registrationor Subsequent Shelf Registration, as the case may be, is no longer effectiveand each of the Issuers shall use its best efforts to obtain the promptwithdrawal of any order suspending the effectiveness thereof, and in any eventshall within 30 days of such cessation of effectiveness amend the ShelfRegistration in a manner to obtain the withdrawal of the order suspending theeffectiveness thereof, or file an additional “shelf” Registration Statementpursuant to Rule 415 covering all of the Registrable Notes then outstanding(a “Subsequent Shelf Registration”). If a Subsequent Shelf Registration is filed, each of the Issuers shalluse its best efforts to cause the Subsequent Shelf Registration to be declaredeffective as soon as practicable after such filing and to keep such SubsequentShelf Registration continuously effective for a period (the “ApplicablePeriod”) equal to the number of days in the Effectiveness Period less theaggregate number of days during which the Initial Shelf Registration, or anySubsequent Shelf Registrations, was previously continuously effective.  As used herein the term “ShelfRegistration” means the Initial Shelf Registration and any Subsequent ShelfRegistration.

 

(c)                         Supplementsand Amendments.  Each of the Issuersshall promptly supplement and amend any Shelf Registration if required by therules, regulations or instructions applicable to the registration form used forsuch Shelf Registration, or if required by the Securities Act.

 

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4.                  Additional Interest

 

(a)                         TheIssuers and the Purchasers agree that the Holders of Registrable Notes willsuffer damages if the Issuers fail to fulfill their obligations under Section 2or Section 3 hereof and that it would not be feasible to ascertain the extentof such damages with precision. Accordingly, each of the Issuers agrees to pay, as liquidated damages,additional interest on the Registrable Notes (“Additional Interest”)under the circumstances and to the extent set forth below (each of which shall begiven independent effect):

 

(i)                                    if(A) neither the Exchange Registration Statement nor the Initial ShelfRegistration has been filed on or prior to the Filing Date or (B) notwithstandingthat the Issuers have consummated or will consummate an Exchange Offer, theIssuers are required to file a Shelf Registration and such Shelf Registrationis not filed on or prior to the 120th day after delivery of theShelf Notice, then, in the case of subclause (A), commencing on the dayafter the Filing Date or, in the case of subclause (B), commencing on the121st day following delivery of the Shelf Notice, AdditionalInterest shall accrue on the Registrable Notes over and above the statedinterest at a rate of 1.0% per annum for the first 90 days immediatelyfollowing the Filing Date or such 120th day, as the case may be, suchAdditional Interest rate increasing by an additional 0.50% per annum at thebeginning of each subsequent 90-day period;

 

(ii)                                 if(A) neither the Exchange Registration Statement nor the Initial ShelfRegistration is declared effective on or prior to the Effectiveness Dateapplicable thereto or (B) notwithstanding that the Issuers haveconsummated or will consummate an Exchange Offer, the Issuers are required tofile a Shelf Registration and such Shelf Registration is not declared effectiveby the Commission on or prior to the applicable Effectiveness Date, then,commencing on the day after such applicable Effectiveness Date, AdditionalInterest shall accrue on the Registrable Notes over and above the statedinterest at a rate of 1.0% per annum for the first 90 days immediatelyfollowing the day after the applicable Effectiveness Date, such AdditionalInterest rate increasing by an additional 0.50% per annum at the beginning ofeach subsequent 90-day period; and

 

(iii)                              if(A) the Company has not exchanged Exchange Notes for all Notes validlytendered and not withdrawn in accordance with the terms of the Exchange Offeron or prior to the 255th day after the Issue Date, (B) theExchange Registration Statement ceases to be effective prior to consummation ofthe Exchange Offer or (C) if applicable, a Shelf Registration has beendeclared effective and such Shelf Registration ceases to be effective at anytime during the Effectiveness Period (other than as a result of the impositionof any Suspension Period in accordance with the penultimate paragraph of Section 5of this Agreement), then Additional Interest shall accrue on the RegistrableNotes over and above the stated interest at a rate of 1.0% per annum for thefirst 90 days commencing on the (x) 256th day after the IssueDate in the case of (A) above or (y) the day such ExchangeRegistration Statement or Shelf Registration ceases to be effective in the caseof (B) and (C) above, such Additional Interest rate increasing by anadditional 0.50% per annum at the beginning of each such subsequent 90-dayperiod;

 

provided, however,that the Additional Interest rate on the Registrable Notes may not exceed inthe aggregate 2.0% per annum; providedfurther that (1) uponthe filing of the Exchange

 

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Registration Statement or each Shelf Registration (in the case of (i) above),(2) upon the effectiveness of the Exchange Registration Statement or eachShelf Registration, as the case may be (in the case of (ii) above), or (3) uponthe exchange of Exchange Notes for all Registrable Notes tendered (in the caseof (iii) (A) above) or upon the effectiveness of an ExchangeRegistration Statement or Shelf Registration which had ceased to remaineffective (in the case of (iii)(B) and (C) above), AdditionalInterest on any Registrable Notes then accruing Additional Interest as a resultof such clause (or the relevant subclause thereof), as the case may be,shall cease to accrue.

 

(b)                        TheIssuers shall notify the Trustee within one Business Day after each and everydate on which an event occurs in respect of which Additional Interest isrequired to be paid (an “Event Date”). Any amounts of Additional Interest due pursuant to (a)(i), (a)(ii) or(a)(iii) of this Section 4 will be payable in cash semi-annually oneach regular interest payment date specified in the Indenture (to the Holdersof Registrable Notes of record on the regular record date therefor (asspecified in the Indenture) immediately preceding such dates), commencing withthe first such regular interest payment date occurring after any suchAdditional Interest commences to accrue. The amount of Additional Interest will be determined by multiplying theapplicable Additional Interest rate by the principal amount of the Notessubject thereto, multiplied by a fraction, the numerator of which is the numberof days such Additional Interest rate was applicable during such period(determined on the basis of a 360-day year comprised of twelve 30-daymonths), and the denominator of which is 360.

 

5.                  Registration Procedures

 

In connectionwith the filing of any Registration Statement pursuant to Section 2 or 3hereof, each Issuer shall effect such registration to permit the sale of suchsecurities covered thereby in accordance with the intended method or methods ofdisposition thereof, and pursuant thereto and in connection with anyRegistration Statement filed by each Issuer hereunder, each Issuer shall:

 

(a)                         Prepareand file with the Commission prior to the Filing Date, the ExchangeRegistration Statement or if the Exchange Registration Statement is not filedor is unavailable, a Shelf Registration as prescribed by Section 2 or 3,and use its best efforts to cause each such Registration Statement to becomeeffective and remain effective as provided herein; provided that, if aShelf Registration is filed pursuant to Section 3, before filing anyRegistration Statement or Prospectus or any amendments or supplements thereto,the Issuers shall, if requested, afford the Holders of the Registrable Notes tobe registered pursuant to such Shelf Registration and their legal counsel areasonable opportunity to review copies of all such documents (including copiesof any documents to be incorporated by reference therein and all exhibitsthereto) proposed to be filed (in each case at least five Business Days priorto such filing).  The Issuers shall notfile any such Registration Statement or Prospectus or any amendments orsupplements thereto if the Holders of a majority in aggregate principal amountof the Registrable Notes covered by such Registration Statement shallreasonably object thereto.

 

(b)                        Prepareand file with the Commission such amendments and post-effective amendments toeach Shelf Registration or Exchange Registration Statement, as the case may be,

 

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as may benecessary to keep such Registration Statement continuously effective for theEffectiveness Period or the Applicable Period, as the case may be; cause therelated Prospectus to be supplemented by any Prospectus supplement required byapplicable law, and as so supplemented to be filed pursuant to Rule 424(or any similar provisions then in force) under the Securities Act; and complywith the provisions of the Securities Act and the Exchange Act applicable to itwith respect to the disposition of all securities covered by such RegistrationStatement as so amended or in such Prospectus as so supplemented.

 

(c)                         Ifa Shelf Registration is filed pursuant to Section 3, notify each sellingHolder of Registrable Notes, its counsel and the managing underwriters, if any,promptly (but in any event within two Business Days), and confirm such noticein writing, (i) when a Prospectus or any Prospectus supplement orpost-effective amendment has been filed, and, with respect to a RegistrationStatement or any post-effective amendment, when the same has become effective(including in such notice a written statement that any Holder may, uponrequest, obtain, without charge, one conformed copy of such RegistrationStatement or post-effective amendment including financial statements andschedules, documents incorporated or deemed to be incorporated by reference andexhibits), (ii) of the issuance by the Commission of any stop ordersuspending the effectiveness of a Registration Statement or of any orderpreventing or suspending the use of any preliminary prospectus or theinitiation of any proceedings for that purpose, (iii) if at any time whena prospectus is required by the Securities Act to be delivered in connectionwith sales of the Registrable Notes the representations and warranties of anyIssuer contained in any agreement (including any underwriting agreementcontemplated by Section 5(n) hereof) cease to be true and correct in anymaterial respect, (iv) of the happening of any event, the existence of anycondition or any information becoming known that makes any statement made insuch Registration Statement or related Prospectus or any document incorporatedor deemed to be incorporated therein by reference untrue in any materialrespect or that requires the making of any changes in, or amendments orsupplements to, such Registration Statement, Prospectus or documents so that,in the case of the Registration Statement, it will not contain any untruestatement of a material fact or omit to state any material fact required to bestated therein or necessary to make the statements therein not misleading, andthat in the case of the Prospectus, it will not contain any untrue statement ofa material fact or omit to state any material fact required to be statedtherein or necessary to make the statements therein, in the light of thecircumstances under which they were made, not misleading, and (v) of theIssuers’ reasonable determination that a post-effective amendment to aRegistration Statement would be appropriate.

 

(d)                        Ifa Shelf Registration is filed pursuant to Section 3, use their bestefforts to prevent the issuance of any order suspending the effectiveness ofsuch Shelf Registration or of any order preventing or suspending the use of aProspectus or suspending the qualification (or exemption from qualification) ofany of the Registrable Notes, and, if any such order is issued, to use its bestefforts to obtain the withdrawal of any such order at the earliest possibledate.

 

(e)                         Ifa Shelf Registration is filed pursuant to Section 3 and if requested bythe managing underwriters, if any, or the Holders of a majority in aggregateprincipal amount of the Registrable Notes being sold in connection with anunderwritten offering, (i) as promptly as practicable incorporate in aprospectus supplement or post-effective amendment such

 

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information orrevisions to information therein relating to such underwriters or sellingHolders as the managing underwriters, if any, or such Holders or their counselreasonably request to be included or made therein, (ii) make all requiredfilings of such prospectus supplement or such post-effective amendment as soonas practicable after the Issuers have received notification of the matters tobe incorporated in such prospectus supplement or post-effective amendment, and (iii) supplementor make amendments to such Registration Statement.

 

(f)                           Ifa Shelf Registration is filed pursuant to Section 3, furnish to eachselling Holder of Registrable Notes who so requests and its counsel and eachmanaging underwriter, if any, without charge, one conformed copy of theRegistration Statement or Registration Statements and each post-effectiveamendment thereto, including financial statements and schedules, and, ifrequested, all documents incorporated or deemed to be incorporated therein byreference and all exhibits.

 

(g)                        Ifa Shelf Registration is filed pursuant to Section 3, deliver to eachselling Holder of Registrable Notes, its respective counsel, and theunderwriters, if any, without charge, as many copies of the Prospectus orProspectuses (including each form of preliminary prospectus) and each amendmentor supplement thereto and any documents incorporated by reference therein assuch Persons may reasonably request; and, subject to the last and penultimateparagraphs of this Section 5, the Issuers hereby consent to the use ofsuch Prospectus and each amendment or supplement thereto by each of the sellingHolders of Registrable Notes and the underwriters or agents, if any, inconnection with the offering and sale of the Registrable Notes covered by suchProspectus and any amendment or supplement thereto.

 

(h)                        Priorto any public offering of Registrable Notes, use its best efforts to registeror qualify, and cooperate with the selling Holders of Registrable Notes, theunderwriters, if any, and their respective counsel in connection with theregistration or qualification (or exemption from such registration orqualification) 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 jurisdictionswithin the United States as any selling Holder or the managing underwriter orunderwriters, if any, reasonably request in writing; provided that noIssuer shall be required to (A) qualify generally to do business in anyjurisdiction where it is not then so qualified, (B) take any action thatwould subject it to general service of process in any such jurisdiction whereit is not then so subject or (C) subject itself to taxation in excess of anominal dollar amount in any such jurisdiction where it is not then so subject.

 

(i)                            Ifa Shelf Registration is filed pursuant to Section 3, cooperate with theselling Holders of Registrable Notes and the managing underwriter orunderwriters, if any, to facilitate the timely preparation and delivery ofcertificates representing Registrable Notes to be sold, which certificatesshall not bear any restrictive legends and shall be in a form eligible fordeposit with The Depository Trust Company (or any similar successordepositary); and enable such Registrable Notes to be in such denominations andregistered in such names as the managing underwriter or underwriters, if any,or the Holders may reasonably request.

 

(j)                            Useits best efforts to cause the Registrable Notes covered by the RegistrationStatement to be registered with or approved by such governmental agencies or

 

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authorities asmay be necessary to enable the seller or sellers thereof or the underwriters,if any, to consummate the disposition of such Registrable Notes, in which casethe Issuers will cooperate in all reasonable respects with the filing of suchRegistration Statement and the granting of such approvals.

 

(k)                         Ifa Shelf Registration is filed pursuant to Section 3, upon the occurrenceof any event contemplated by paragraph 5(c)(iv) or 5(c)(v) hereof,as promptly as practicable prepare and (subject to Section 5(a) hereof)file with the Commission, at the Issuers’ sole expense, a supplement orpost-effective amendment to the Registration Statement or any documentincorporated or deemed to be incorporated therein by reference, or file anyother required document so that, as thereafter delivered to the purchasers ofthe Registrable Notes being sold thereunder, any such Prospectus will notcontain an untrue statement of a material fact or omit to state a material factrequired to be stated therein or necessary to make the statements therein, inthe light of the circumstances under which they were made, not misleading.

 

(l)                            Useits commercially reasonable efforts to cause the Registrable Notes covered by aRegistration Statement to be rated with the appropriate rating agencies, if sorequested by the Holders of a majority in aggregate principal amount ofRegistrable Notes covered by such Registration Statement or the managingunderwriter or underwriters, if any.

 

(m)                      Priorto the effective date of the first Registration Statement relating to theRegistrable Notes, (i) provide the Trustee with printed certificates forthe Registrable Notes or the Exchange Notes, as the case may be, in a formeligible for deposit with the Depository Trust Company and (ii) provide aCUSIP number for the Registrable Notes or the Exchange Notes, as the case maybe.

 

(n)                        Inconnection with an underwritten offering of Registrable Notes pursuant to aShelf Registration, enter into an underwriting agreement as is customary inunderwritten offerings of debt securities similar to the Notes and take allsuch other actions as are reasonably requested by the managing underwriter orunderwriters in order to expedite or facilitate the registration or thedisposition of such Registrable Notes and, in such connection, (i) makesuch representations and warranties to the underwriters, with respect to thebusiness of the Issuers and their subsidiaries and the Registration Statement,Prospectus and documents, if any, incorporated or deemed to be incorporated byreference therein, in each case, as are customarily made by issuers tounderwriters in underwritten offerings of debt securities similar to the Notes,and confirm the same in writing if and when requested; (ii) obtain theopinion of counsel to the Issuers and updates thereof in form and substancereasonably satisfactory to the managing underwriter or underwriters, addressedto the underwriters covering the matters customarily covered in opinionsrequested in underwritten offerings of debt securities similar to the Notes andsuch other matters as may be reasonably requested by managing underwriters; and(iii) obtain “cold comfort” letters and updates thereof in form andsubstance reasonably satisfactory to the managing underwriter or underwritersfrom the independent certified public accountants of the Issuers (and, ifnecessary, any other independent certified public accountants of any subsidiaryof any Issuer or of any business acquired by the Company any Issuer for whichfinancial statements and financial data are, or are required to be, included inthe Registration Statement), addressed to each of the underwriters, such lettersto be in customary form and

 

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coveringmatters of the type customarily covered in “cold comfort” letters in connectionwith underwritten offerings of debt securities similar to the Notes and suchother matters as are reasonably requested by the managing underwriter orunderwriters.  The above shall be done ateach closing under such underwriting agreement, or as and to the extentrequired thereunder.

 

(o)                        Ifa Shelf Registration is filed pursuant to Section 3, make available forinspection by a representative of a majority in interest of the selling Holdersof such Registrable Notes being sold, any underwriter participating in any suchdisposition of Registrable Notes, if any, and any attorney, accountant or otheragent retained by any such representative, (collectively, the “Inspectors”),at the offices where normally kept, during reasonable business hours, allfinancial and other records, pertinent corporate documents and properties ofeach Issuer and its subsidiaries (collectively, the “Records”) as shallbe reasonably necessary to enable them to exercise any applicable due diligenceresponsibilities, and cause the officers, directors and employees of eachIssuer and its subsidiaries to supply all information reasonably requested byany such Inspector in connection with such Registration Statement.  Records which an Issuer determines, in goodfaith, to be confidential and any Records which it notifies the Inspectors areconfidential shall not be disclosed by the Inspectors unless (i) thedisclosure of such Records is necessary to avoid or correct a materialmisstatement or omission in such Registration Statement, (ii) the releaseof such Records is ordered pursuant to a subpoena or other order from a courtof competent jurisdiction, (iii) the information in such Records has beenmade generally available to the public other than as a result of a disclosureor failure to safeguard by such Inspector or (iv) disclosure of suchinformation is, in the reasonable opinion of counsel for any Inspector,necessary or advisable in connection with any action, claim, suit orproceeding, directly or indirectly, involving or potentially involving suchInspector and arising out of, based upon, related to, or involving thisAgreement, or any transactions contemplated hereby or arising hereunder.  Each selling Holder of such Registrable Noteswill be required to agree that information obtained by it as a result of suchinspections shall be deemed confidential and shall not be used by it as thebasis for any transactions in the securities of any Issuer unless and untilsuch is made generally available to the public. Each Inspector and each selling Holder of such Registrable Notes will berequired to further agree that it will, upon learning that disclosure of suchRecords is sought in a court of competent jurisdiction pursuant to clause (ii) or(iv) of the previous sentence or otherwise, give notice to the Issuers andallow the Issuers to undertake appropriate action to obtain a protective orderor otherwise prevent disclosure of the Records deemed confidential at its soleexpense; provided, however, that under no circumstances will such Inspector orHolder of Registrable Notes be required to participate in the efforts ofIssuers to prevent disclosure or withhold any Records duly requested by a courtof competent jurisdiction.

 

(p)                        Provideor maintain an indenture trustee for the Registrable Notes or the ExchangeNotes, as the case may be, and cause the Indenture to be qualified under theTIA not later than the effective date of the Exchange Offer or the firstRegistration Statement relating to the Registrable Notes; and in connectiontherewith, cooperate with the trustee under the Indenture and the Holders ofthe Registrable Notes, to effect such changes to the Indenture as may berequired for the Indenture to be so qualified in accordance with the terms ofthe TIA; and execute, and use its best efforts to cause such trustee to execute,all documents as may be

 

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required toeffect such changes, and all other forms and documents required to be filedwith the Commission to enable the Indenture to be so qualified in a timelymanner.

 

(q)                        Complywith all applicable rules and regulations of the Commission and makegenerally available to its securityholders earnings statements satisfying theprovisions of Section 11(a) of the Securities Act and Rule 158thereunder (or any similar rule promulgated under the Securities Act) nolater than 45 days after the end of any 12-month period (or90 days after the end of any 12-month period if such period is afiscal year) (i) commencing at the end of any fiscal quarter in whichRegistrable Notes are sold to underwriters in a firm commitment or best effortsunderwritten offering and (ii) if not sold to underwriters in such anoffering, commencing on the first day of the first fiscal quarter of theCompany after the effective date of a Registration Statement, which statementsshall cover said 12-month periods.

 

(r)                           Uponconsummation of the Exchange Offer obtain an opinion of counsel to the Issuers,in a form customary for underwritten transactions, addressed to the Trustee forthe benefit of all Holders of Registrable Notes participating in the ExchangeOffer that the Exchange Notes, the Guarantees and the related indentureconstitute legally valid and binding obligations of the Issuers enforceableagainst the Issuers in accordance with their respective terms.

 

(s)                         Ifthe Exchange Offer is to be consummated, upon delivery of the Registrable Notesby Holders to the Issuers (or to such other Person as directed by the Company)in exchange for the Exchange Notes, the Issuers shall mark, or caused to bemarked, on such Registrable Notes that such Registrable Notes are beingcancelled in exchange for the Exchange Notes; in no event shall suchRegistrable Notes be marked as paid or otherwise satisfied.

 

(t)                           Cooperatewith each seller of Registrable Notes covered by any Registration Statement andeach underwriter, if any, participating in the disposition of such RegistrableNotes and their respective counsel in connection with any filings required tobe made with the NASD.

 

(u)                        Useits best efforts to take all other steps reasonably necessary to effect theregistration of the Registrable Notes covered by a Registration Statement contemplatedhereby.

 

The Issuersmay require each seller of Registrable Notes as to which any registration isbeing effected to furnish to the Issuers such information regarding such sellerand the distribution of such Registrable Notes as the Issuers may, from time totime, reasonably request.  The Issuersmay exclude from such registration the Registrable Notes of any seller whofails to furnish such information within a reasonable time after receiving suchrequest.  Each seller as to which anyShelf Registration Statement is being effected agrees to furnish promptly tothe Issuers all information required to be disclosed in order to make theinformation previously furnished to the Issuers by such seller not materiallymisleading.

 

Each Holder ofRegistrable Notes agrees by acquisition of such Registrable Notes that, uponreceipt of any notice from the Issuers of the happening of any event of thekind described in Section 5(c)(ii), 5(c)(iv) , or 5(c)(v) or anotice given in accordance with the last paragraph of this Section 5, suchHolder will forthwith discontinue disposition of such Registrable Notes coveredby such Registration Statement or Prospectus or Exchange Notes to

 

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be sold bysuch Holder and, in each case, dissemination of such Prospectus until suchHolder’s receipt of the copies of the supplemented or amended Prospectuscontemplated by Section 5(k), or until it is advised in writing (the “Advice”)by the Company that the use of the applicable Prospectus may be resumed, andhas received copies of any amendments or supplements thereto.  In the event the Issuers shall give any suchnotice, the Effectiveness Period shall be extended by the number of days duringsuch periods from and including the date of the giving of such notice to andincluding the date when each seller of Registrable Notes covered by suchRegistration Statement or Exchange Notes shall have received (x) thecopies of the supplemented or amended Prospectus contemplated by Section 5(k)or (y) the Advice.

 

Notwithstandinganything to the contrary in this Agreement, if at any time or from time to timeafter the effective date of a Shelf Registration filed pursuant to Section 2,the Company notifies in writing each Holder of Registrable Notes to be soldpursuant to the Shelf Registration of the existence of a Potential MaterialEvent, the Holders shall not offer to sell any Registrable Notes pursuant tothe prospectus contained in such Shelf Registration from the time of the givingof notice with respect to a Potential Material Event until the Holders receivewritten notice from the Company that such Potential Material Event either hasbeen disclosed to the public or no longer constitutes a Potential MaterialEvent; provided, however, that (i) in no event shall theeffectiveness of such Shelf Registration be suspended for a period of more than30 days (a “Suspension Period”), (ii) the Company may not declareSuspension Periods more than two (2) times in any calendar year and (iii) ineach such case the Effectiveness Period of the Shelf Registration provided forin Section 2 shall be extended by the number of days of the applicableSuspension Period pursuant to the foregoing and Additional Interest shall notapply during the Suspension Period to the extent that such Additional Interestis due solely as a result of the imposition of the Suspension Period.

 

6.                  Registration Expenses

 

All fees andexpenses incident to the performance of or compliance with this Agreement bythe Issuers shall be borne by the Issuers whether or not the Exchange Offer ora Shelf Registration is filed or becomes effective, including, withoutlimitation, (i) all registration and filing fees (including, withoutlimitation, (A) fees with respect to filings required to be made with theNASD in connection with an underwritten offering and (B) fees and expensesof compliance with state securities or Blue Sky laws (including, withoutlimitation, reasonable fees and disbursements of counsel in connection withBlue Sky qualifications of the Registrable Notes or Exchange Notes anddetermination of the eligibility of the Registrable Notes or Exchange Notes forinvestment under the laws of such jurisdictions where the holders ofRegistrable Notes are located, in the case of the Exchange Notes, (ii) printingexpenses, including, without limitation, expenses of printing certificates forRegistrable Notes or Exchange Notes in a form eligible for deposit with TheDepository Trust Company (or any similar successor depositary) and of printing prospectusesif the printing of prospectuses is requested by the managing underwriter orunderwriters, if any, or by the Holders of a majority in aggregate principalamount of the Registrable Notes included in any Registration Statement, (iii) reasonablemessenger, telephone and delivery expenses incurred in connection with theExchange Registration Statement and any Shelf Registration, (iv) fees anddisbursements of counsel for the Issuers and fees and disbursements of one firmof special counsel for the

 

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Purchasers inconnection with the Exchange Offer and for the sellers of Registrable Notes inconnection with any Shelf Registration, (v) fees and disbursements of allindependent certified public accountants referred to in Section 5(n)(iii) (including,without limitation, the expenses of any special audit and “cold comfort”letters required by or incident to such performance in accordance with thisAgreement), (vi) rating agency fees, (vii) Securities Act liabilityinsurance, if any Issuer desires such insurance, (viii) fees and expensesof all other Persons retained by the Issuers, (ix) internal expenses ofthe Issuers (including, without limitation, all salaries and expenses ofofficers and employees of the Issuers performing legal or accounting duties),(x) the expense of any annual or special audit, (xi) the fees andexpenses incurred in connection with the listing of the securities to beregistered on any securities exchange, (xi) the fees and disbursements ofunderwriters, if any, customarily paid by issuers or sellers of securities (butnot including any underwriting discounts or commissions or transfer taxes, ifany, attributable to the sale of the Registrable Notes, which discounts,commissions or taxes shall be paid by Holders of such Registrable Notes) and(xiii) the expenses relating to printing, word processing and distributingall Registration Statements, underwriting agreements, securities salesagreements, indentures and any other documents necessary in order to complywith this Agreement.

 

7.                  Indemnification

 

(a)                         Eachof the Issuers jointly and severally agrees to indemnify and hold harmless eachHolder of Registrable Notes, the officers, directors, employees and agents ofeach such Person, and each Person, if any, who controls any such Person withinthe meaning of either Section 15 of the Securities Act or Section 20of the Exchange Act (each, a “Participant”), from and against any andall losses, claims, damages and liabilities (including, without limitation, thereasonable legal fees and other reasonable expenses actually incurred inconnection with any suit, action or proceeding or any claim asserted) causedby, arising out of or based upon any untrue statement or alleged untruestatement of a material fact contained in any Registration Statement orProspectus (as amended or supplemented if the Issuers shall have furnished anyamendments or supplements thereto) or caused by, arising out of or based uponany omission or alleged omission to state therein a material fact required tobe stated therein or necessary to make the statements therein, in the light ofthe circumstances under which they were made, not misleading, except insofar assuch losses, claims, damages or liabilities are caused by any untrue statementor omission or alleged untrue statement or omission made in reliance upon andin conformity with information relating to any Participant furnished to theIssuers in writing by or on behalf of such Participant expressly for usetherein; provided, however, that the Issuers shall not be liableif such untrue statement or omission or alleged untrue statement or omissionwas contained or made in any preliminary prospectus and corrected in theProspectus or any amendment or supplement thereto and the Prospectus does notcontain any other untrue statement or omission or alleged untrue statement oromission of a material fact that was the subject matter of the relatedproceeding and any such loss, liability, claim, damage or expense suffered or incurredby the Participants resulted from any action, claim or suit by any Person whopurchased Registrable Notes or Exchange Notes which are the subject thereoffrom such Participant and it is established in the related proceeding that suchParticipant failed to deliver or provide a copy of the Prospectus (as amendedor supplemented) to such Person with or prior to the confirmation of the saleof such Registrable Notes or Exchange Notes sold to such Person if required byapplicable law, unless such failure to deliver or provide a copy of theProspectus (as

 

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amended orsupplemented) was a result of noncompliance by the Issuers with Section 5of this Agreement.

 

(b)                        EachParticipant will be required to agree, severally and not jointly, to indemnifyand hold harmless each Issuer, its directors and officers and each Person whocontrols each Issuer within the meaning of Section 15 of the SecuritiesAct or Section 20 of the Exchange Act to the same extent as the foregoingindemnity from the Issuers to each Participant, but only with reference toinformation relating to any Participant furnished to the Issuers in writing bysuch Participant expressly for use in any Registration Statement or Prospectus,any amendment or supplement thereto, or any preliminary prospectus.  The liability of any Participant under thisparagraph shall in no event exceed the proceeds received by such Participantfrom sales of Registrable Notes or Exchange Notes giving rise to such obligations.

 

(c)                         Ifany suit, action, proceeding (including any governmental or regulatoryinvestigation), claim or demand shall be brought or asserted against any Personin respect of which indemnity may be sought pursuant to either of the twopreceding paragraphs, such Person (the “Indemnified Person”) shallpromptly notify the Person against whom such indemnity may be sought (the “IndemnifyingPerson”) in writing, and the Indemnifying Person, upon request of theIndemnified Person, shall retain counsel reasonably satisfactory to theIndemnified Person to represent the Indemnified Person and any others theIndemnifying Person may reasonably designate in such proceeding and shall paythe reasonable fees and expenses actually incurred by such counsel related to suchproceeding; provided, however, that the failure to so notify theIndemnifying Person shall not relieve it of any obligation or liability whichit may have hereunder except to the extent that the indemnifying party isunaware of the commencement of such action and such omission results in theforfeiture by the indemnifying party of substantial rights and defenses.  In any such proceeding, any IndemnifiedPerson shall have the right to retain its own counsel, but the fees andexpenses of such counsel shall be at the expense of such Indemnified Personunless (i) the Indemnifying Person and the Indemnified Person shall havemutually agreed in writing to the contrary, (ii) the Indemnifying Personhas failed within a reasonable time to retain counsel reasonably satisfactoryto the Indemnified Person or (iii) the named parties in any suchproceeding (including any impleaded parties) include both the IndemnifyingPerson and the Indemnified Person and the Indemnified Person shall havereasonably concluded that there may be one or more legal defenses available toit and/or other Indemnified Persons that are different from or in addition tothose available to any such Indemnifying Person.  It is understood that, unless there is aconflict among Indemnified Persons, the Indemnifying Person shall not, inconnection with any proceeding or related proceedings in the same jurisdiction,be liable for the fees and expenses of more than one separate firm (in additionto any local counsel) for all Indemnified Persons, and that all such fees andexpenses shall be reimbursed as they are incurred.  Any such separate firm for the Participantsand control Persons of Participants shall be designated in writing byParticipants who sold a majority in interest of Registrable Notes sold by allsuch Participants and any such separate firm for the Issuers, their respectivedirectors, officers and such control Persons of the Issuers shall be designatedin writing by the Company.  TheIndemnifying Person shall not be liable for any settlement of any proceedingeffected without its written consent, but if settled with such consent or ifthere is a final non-appealable judgment for the plaintiff, the IndemnifyingPerson agrees to indemnify any Indemnified Person from and against any loss or

 

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liability byreason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an IndemnifiedPerson shall have requested an Indemnifying Person to reimburse the IndemnifiedPerson for reasonable fees and expenses actually incurred by counsel ascontemplated by the third sentence of this paragraph, the Indemnifying Personagrees that it shall be liable for any settlement of any proceeding effectedwithout its consent if (i) such settlement is entered into more than30 days after receipt by such Indemnifying Person of the aforesaid requestand (ii) such Indemnifying Person shall not have reimbursed theIndemnified Person in accordance with such request prior to the date of suchsettlement; provided, however, that the Indemnifying Person shallnot be liable for any settlement effected without its consent pursuant to thissentence if the Indemnifying Person is contesting, in good faith, the requestfor reimbursement.  No Indemnifying Personshall, without the prior written consent of the Indemnified Person, effect anysettlement of any pending or threatened proceeding in respect of which anyIndemnified Person is or could have been a party and indemnity could have beensought hereunder by such Indemnified Person, unless such settlement (A) includesan unconditional release of such Indemnified Person, in form and substancesatisfactory to such Indemnified Person, from all liability on claims that arethe subject matter of such proceeding and (B) does not include anystatement as to an admission of fault, culpability or failure to act by or onbehalf of an Indemnified Person.

 

(d)                        Ifthe indemnification provided for in the first and second paragraphs of this Section 7is unavailable to, or insufficient to hold harmless, an Indemnified Person inrespect of any losses, claims, damages or liabilities referred to therein, theneach Indemnifying Person under such paragraphs, in lieu of indemnifying suchIndemnified Person thereunder and in order to provide for just and equitablecontribution, shall contribute to the amount paid or payable by suchIndemnified Person as a result of such losses, claims, damages or liabilitiesin such proportion as is appropriate to reflect the relative fault of the IndemnifyingPerson or Persons on the one hand and the Indemnified Person or Persons on theother in connection with the statements or omissions (or alleged statements oromissions) that resulted in such losses, claims, damages or liabilities (oractions in respect thereof) as well as any other relevant equitableconsiderations.  The relative fault ofthe parties shall be determined by reference to, among other things, whetherthe untrue or alleged untrue statement of a material fact or the omission oralleged omission to state a material fact relates to information supplied bythe Issuers on the one hand or by the Participants or such other IndemnifiedPerson, as the case may be, on the other, the parties’ relative intent,knowledge, access to information and opportunity to correct or prevent suchstatement or omission and any other equitable considerations appropriate underthe circumstances.

 

(e)                         Theparties agree that it would not be just and equitable if contribution pursuantto this Section 7 were determined by prorata allocation(even if the Participants were treated as one entity for such purpose) or byany other method of allocation that does not take account of the equitableconsiderations referred to in the immediately preceding paragraph.  The amount paid or payable by an IndemnifiedPerson as a result of the losses, claims, damages and liabilities referred toin the immediately preceding paragraph shall be deemed to include, subject tothe limitations set forth above, any reasonable legal or other expensesactually incurred by such Indemnified Person in connection with investigatingor defending any such action or claim. Notwithstanding the provisions of this Section 7, in no event shalla Participant be required to

 

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contribute anyamount in excess of the amount by which proceeds received by such Participantfrom sales of Registrable Notes or Exchange Notes, as the case may be, exceedsthe amount of any damages that such Participant has otherwise been required topay by reason of such untrue or alleged untrue statement or omission or allegedomission.  No Person guilty of fraudulentmisrepresentation (within the meaning of Section 11(f) of theSecurities Act) shall be entitled to contribution from any Person who was notguilty of such fraudulent misrepresentation.

 

(f)                           Theindemnity and contribution agreements contained in this Section 7 will bein addition to any liability which the Indemnifying Persons may otherwise haveto the Indemnified Persons referred to above.

 

8.                  Rules 144 and 144A

 

Each of theIssuers covenants that it will file the reports required to be filed by itunder the Securities Act and the Exchange Act and the rules andregulations adopted by the Commission thereunder in a timely manner and, if atany time it is not required to file such reports, it will, upon the request ofany Holder of Registrable Notes, make publicly available other information solong as necessary to permit sales pursuant to Rule 144 and Rule 144Aunder the Securities Act.  Each of theIssuers further covenants, for so long as any Registrable Notes remainoutstanding, to make available to any Holder or beneficial owner of RegistrableNotes in connection with any sale thereof and any prospective purchaser of suchRegistrable Notes from such Holder or beneficial owner, the informationrequired by Rule 144A(d)(4) under the Securities Act in order topermit resales of such Registrable Notes pursuant to Rule 144A.

 

9.                  Underwritten Registrations

 

If any of theRegistrable Notes covered by any Shelf Registration are to be sold in anunderwritten offering, the investment banker or investment bankers and manageror managers that will manage the offering will be selected by the Holders of amajority in aggregate principal amount of such Registrable Notes included insuch offering and reasonably acceptable to the Issuers.

 

No Holder ofRegistrable Notes may participate in any underwritten registration hereunderunless such Holder (a) agrees to sell such Holder’s Registrable Notes onthe basis provided in any underwriting arrangements approved by the Personsentitled hereunder to approve such arrangements and (b) completes andexecutes all questionnaires, powers of attorney, indemnities, underwritingagreements and other documents required under the terms of such underwritingarrangements.

 

10.            Miscellaneous

 

(a)                         Remedies. In the event of a breach by any Issuer of any of its obligations underthis Agreement, each Holder of Registrable Notes, in addition to being entitledto exercise all rights provided herein, in the Indenture, in the Note PurchaseAgreement, or granted by law, including recovery of damages, will be entitledto specific performance of its rights under this Agreement.  Each Issuer agrees that monetary damageswould not be adequate compensation for any loss incurred by reason of a breachby it of any of the provisions of this Agreement and

 

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hereby further agrees that, in the event of any action for specificperformance in respect of such breach, it shall waive the defense that a remedyat law would be adequate.

 

(b)                        No Inconsistent Agreements.  None of the Issuers has entered, as of thedate hereof, and none of the Issuers shall enter, after the date of thisAgreement, into any agreement with respect to any of its securities that isinconsistent with the rights granted to the Holders of Registrable Notes inthis Agreement or otherwise conflicts with the provisions hereof.  None of the Issuers has entered and none of theIssuers shall enter into any agreement with respect to any of its securitieswhich will grant to any Person piggy-back rights with respect to a RegistrationStatement.

 

(c)                         Amendments and Waivers.  The provisions of this Agreement may not beamended, modified or supplemented, and waivers or consents to departures fromthe provisions hereof may not be given, otherwise than with the prior writtenconsent of the Holders of not less than a majority in aggregate principalamount of the then outstanding Registrable Notes; provided, however,that Section 7 and this Section 10(c) may not be amended,modified or supplemented without the prior written consent of each Holder(including any person who was a Holder of Registrable Notes or Exchange Notes,as the case may be, disposed of pursuant to any Registration Statement).  Notwithstanding the foregoing, a waiver orconsent to depart from the provisions hereof with respect to a matter thatrelates exclusively to the rights of Holders of Registrable Notes whose securitiesare being tendered pursuant to the Exchange Offer or sold pursuant to aRegistration Statement and that does not directly or indirectly affect, impair,limit or compromise the rights of other Holders of Registrable Notes may begiven by Holders of at least a majority in aggregate principal amount of theRegistrable Notes being tendered or being sold by such Holders pursuant to suchRegistration Statement.

 

(d)                        Notices. All notices and other communications provided for or permitted hereundershall be made in writing by hand delivery, registered first-class mail,next-day air courier or telecopier:

 

1.                             if to a Holder of Registrable Notes, at themost current address of such Holder set forth on the records of the registrarunder the Indenture;

 

2.                             ifto the Issuers, as follows:

 

Jacobs Entertainment, Inc.240 Main StreetBlack Hawk, Colorado 80422Facsimile No.: (303) 582-0239Attention:  President

 

with copies to:

 

Baker & Hostetler LLP1900 East 9th Street3700 National CenterCleveland, Ohio 44114Facsimile No.: (216) 696-0740Attention:  Robert A. Weible, Esq.

 

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and

 

Jones & Keller, P.C.1625 Broadway, Suite 1600Denver, Colorado 80202Facsimile No.: (303) 573-0769Attention:  Samuel Wing

 

All such noticesand communications shall be deemed to have been duly given:  when delivered by hand, if personallydelivered; five Business Days after being deposited in the mail, postageprepaid, if mailed; one Business Day after being timely delivered to a next-dayair courier guaranteeing overnight delivery; and when receipt is acknowledgedby the addressee, if telecopied.

 

Copies of allsuch notices, demands or other communications shall be concurrently deliveredby the Person giving the same to the Trustee under the Indenture at the addressspecified in such Indenture.

 

(e)                         Successors and Assigns.  This Agreement shall inure to the benefit ofand be binding upon the successors and assigns of each of the parties heretoand the Holders; provided, however, that this Agreement shall not inure to thebenefit of or be binding upon a successor or assign of a Holder unless, andonly to the extent such successor or assign holds Registrable Notes.

 

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

 

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

 

(h)                        Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY ANDCONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TOCONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TOPRINCIPLES OF CONFLICTS OF LAW.  EACH OFTHE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THESTATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TOTHIS AGREEMENT.

 

(i)                            Severability.  If any term, provision, covenant orrestriction of this Agreement is held by a court of competent jurisdiction tobe invalid, illegal, void or unenforceable, the remainder of the terms,provisions, covenants and restrictions set forth herein shall remain in fullforce and effect and shall in no way be affected, impaired or invalidated, and

 

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the parties hereto shall use their best efforts to find and employ analternative means to achieve the same or substantially the same result as thatcontemplated by such term, provision, covenant or restriction.  It is hereby stipulated and declared to bethe intention of the parties that they would have executed the remaining terms,provisions, covenants and restrictions without including any of such that maybe hereafter declared invalid, illegal, void or unenforceable.

 

(j)                            Notes Held by any Issuer ortheir Affiliates.  Whenever theconsent or approval of Holders of a specified percentage of Registrable Notesis required hereunder, Registrable Notes held by any Issuer or its affiliates(as such term is defined in Rule 405 under the Securities Act) shall notbe counted in determining whether such consent or approval was given by theHolders of such required percentage.

 

(k)                         Third Party Beneficiaries.  Holders of Registrable Notes are intendedthird party beneficiaries of this Agreement and this Agreement may be enforcedby such Persons.

 

(l)                            Entire Agreement.  This Agreement, together with the Note PurchaseAgreement and the Indenture, is intended by the parties as a final andexclusive statement of the agreement and understanding of the parties hereto inrespect of the subject matter contained herein and therein and any and allprior oral or written agreements, representations, or warranties, contracts,understandings, correspondence, conversations and memoranda among thePurchasers on the one hand and the Issuers on the other, or between or amongany agents, representatives, parents, subsidiaries, affiliates, predecessors ininterest or successors in interest with respect to the subject matter hereofand thereof are merged herein and replaced hereby.

 

(m)                      Joint and Several Obligations.  All of the obligations of the Issuershereunder shall be joint and several obligations of each of them.

 

22

----

 

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

 
|   | JACOBS  ENTERTAINMENT, INC.                              |
|--------|----------------------------------------------------------|
|   |                                                     |
|   | By:                                                      | /s/ Jeffrey  P. Jacobs |   |
|   |                                                     | Name:  Jeffrey P. Jacobs |
|   |                                                     | Title:  President |
|   |                                                     |
|   | **GUARANTORS:**                                          |
|   |                                                     |
|   |                                                     |
|   | BLACK HAWK  GAMING & DEVELOPMENT  COMPANY, INC. |
|   |                                                     |
|   |                                                     |
|   |                                                     | By: |      /s/ Stephen  R. Roark |   |
|   |                                                     | Name:  Stephen R. Roark |
|   |                                                     | Title:  President |
|   |                                                     |
|   | GOLD DUST  WEST CASINO, INC.                             |
|   |                                                     |
|   |                                                     |
|   |                                                     | By: |      /s/ Stephen  R. Roark |   |
|   |                                                     | Name:  Stephen R. Roark |
|   |                                                     | Title:  Vice President |
|   |                                                     |
|   | GILPIN  VENTURES, INC.                                   |
|   |                                                     |
|   |                                                     |
|   |                                                     | By: |      /s/ Stephen  R. Roark |   |
|   |                                                     | Name:  Stephen R. Roark |
|   |                                                     | Title:  President |
|        |                                                          |  |  |  |  |  |  |  |  |

 

S-1

----

 
|   | GILPIN HOTEL  VENTURE                   |
|--------|-----------------------------------------|
|   |                                    |   |
|   | By:                                     | GILPIN  VENTURES, INC., its partner |
|   |                                    |
|   |                                    |
|   |                                    | By: |      /s/ Stephen  R. Roark |   |
|   |                                    | Name:  Stephen  R. Roark |
|   |                                    | Title:  President |
|   |                                    |   |
|   |                                    | By: | BLACK HAWK  GAMING & |
|   |                                    | DEVELOPMENT  COMPANY, INC., its |
|   | partner                                 |   |
|   |                                    |   |
|   |                                    | By: |      /s/ Stephen  R. Roark |   |
|   |                                    | Name:  Stephen R. Roark |
|   |                                    | Title:  President |
|   |                                    |   |
|   |                                    |   |
|   | BLACK  HAWK/JACOBS ENTERTAINMENT  LLC   |
|   | By:                                     | BLACK HAWK  GAMING & |
|   | DEVELOPMENT  COMPANY, INC., its manager |
|   |                                    |   |
|   |                                    |   |
|   |                                    | By: |      /s/ Stephen  R. Roark |   |
|   |                                    | Name:  Stephen R. Roark |
|   |                                    | Title:  President |
|   |                                    |   |
|   |                                    |   |
|   | DIVERSIFIED  OPPORTUNITIES GROUP LTD.   |
|   | By:                                     | JACOBS  ENTERTAINMENT, INC., its |
|   | manager                                 |
|   |                                    |
|   |                                    |
|   |                                    | By: |      /s/ Stephen  R. Roark |   |
|   |                                    | Name:  Stephen R. Roark |
|   |                                    | Title:  Chief Financial Officer |
|   |                                    |   |
|   | JALOU L.L.C.                            |
|   |                                    |   |
|   |                                    | By: |      /s/ Ian  M. Stewart |   |
|   |                                    | Name:  Ian M. Stewart |
|   |                                    | Title:  President and Manager |
|        |                                         |  |  |  |  |  |  |  |  |  |  |

 

----

 
|   | HOUMA TRUCK  PLAZA & CASINO, L.L.C.  |
|--------|-----------------------------------------------|
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/ Ian  M. Stewart |   |
|   |                                          | Name:  Ian M. Stewart |
|   |                                          | Title:  President and Manager |
|   |                                          |   |
|   | BAYOU VISTA  TRUCK PLAZA AND CASINO,  L.L.C.  |
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/  Ian M. Stewart |   |
|   |                                          | Name:  Ian M. Stewart |
|   |                                          | Title:  President and Manager |
|   |                                          |   |
|   | LUCKY  MAGNOLIA TRUCK STOP AND  CASINO L.L.C. |
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/ Ian  M. Stewart |   |
|   |                                          | Name:  Ian M. Stewart |
|   |                                          | Title:  President and Manager |
|   |                                          |   |
|   | JALOU-CASH’S  L.L.C.                     |
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/ Ian  M. Stewart |   |
|   |                                          | Name:  Ian M. Stewart |
|   |                                          | Title:  President and Manager |
|   |                                          |   |
|   | RACELAND  TRUCK PLAZA AND CASINO,  L.L.C.     |
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/ Ian  M. Stewart |   |
|   |                                          | Name:  Ian M. Stewart |
|   |                                          | Title:  President and Manager |
|   |                                          |   |
|   | JALOU II INC.                                 |
|   |                                          |   |
|   |                                          |   |
|   |                                          | By: |      /s/ Ian  M. Stewart |   |
|   |                                          | Name: Ian M.  Stewart |
|   |                                          | Title:  President |
|        |                                               |  |  |  |  |  |  |  |  |

 

----

 
|   | WINNER’S  CHOICE CASINO, INC. |
|--------|------------------------------------|
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name:  Ian M. Stewart |
|   |                               | Title:  President |
|   |                               |   |
|   | JACE, INC.                         |
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name:  Ian M. Stewart |
|   |                               | Title:  President |
|   |                               |   |
|   |                               |   |
|   | COLONIAL  DOWNS, L.L.C.            |
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name:  Ian M. Stewart |
|   |                               | Title:  Manager |
|   |                               |   |
|   | JRJ  PROPERTIES, LLC               |
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name:  Ian M. Stewart |
|   |                               | Title:  President and Manager |
|   |                               |   |
|   | COLONIAL  HOLDINGS, INC.           |
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name: Ian M.  Stewart |
|   |                               | Title:  President |
|   |                               |   |
|   |                               |   |
|   | COLONIAL  DOWNS, LP                |
|   |                               |   |
|   | By:                                | STANSLEY  RACING CORP., its general |
|   | Partner                            |
|   |                               |   |
|   |                               |   |
|   |                               | By: |      /s/ Ian  M. Stewart |   |
|   |                               | Name:  Ian M. Stewart |
|   |                               | Title:  President |
|        |                                    |  |  |  |  |  |  |  |  |

 

----

 
|   | STANSLEY  RACING CORP.    |
|--------|---------------------------|
|   |                      |   |
|   |                      |   |
|   |                      | By: |      /s/ Ian  M. Stewart |   |
|   |                      | Name:  Ian M. Stewart |
|   |                      | Title:  President |
|   |                      |   |
|   | JALOU BREAUX  BRIDGE, LLC |
|   |                      |   |
|   |                      |   |
|   |                      | By: |      /s/ Ian  M. Stewart |   |
|   |                      | Name: |
|   |                      | Title: |
|   |                      |   |
|   | JALOU  EUNICE, LLC        |
|   |                      |   |
|   |                      |   |
|   |                      | By: |      /s/ Ian  M. Stewart |   |
|   |                      | Name: |
|   |                      | Title: |
|   |                      |   |
|   |                      |   |
|   | JALOU OF  JEFFERSON, LLC  |
|   |                      |   |
|   |                      |   |
|   |                      | By: |      /s/ Ian  M. Stewart |   |
|   |                      | Name: |
|   |                      | Title: |
|        |                           |  |  |  |  |  |  |

 

----