Document:

exv4w4

Exhibit 4.4

 

 

Registration Rights Agreement

Dated as of March 16, 2010

by and among

MGM MIRAGE

and

the Subsidiary Guarantors listed on the Signature pages hereof,

on the one hand,

and

Banc of America Securities LLC

and

the Initial Purchasers,

on the other hand

 

 

 

 

REGISTRATION RIGHTS AGREEMENT

     This REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into on March 16,
2010, by and among MGM MIRAGE, a Delaware corporation (the “Company”), and the subsidiary
guarantors listed on the signature page of this Agreement (the “Subsidiary Guarantors”), on the one
hand, and Banc of America Securities LLC on its own behalf and as representative of each of the
other Initial Purchasers named in Schedule A hereto (collectively, the “Initial
Purchasers”), on the other hand.

     This Agreement is made pursuant to that certain Purchase Agreement, dated March 9, 2010 by and
among the Company, the Subsidiary Guarantors and the Initial Purchasers (the “Purchase Agreement”),
which provides for the sale by the Company to the Initial Purchasers of an aggregate of
$845,000,000 in principal amount of the Company’s 9% Senior Secured Notes due 2020 (the “Notes”),
which are guaranteed by the Subsidiary Guarantors. In order to induce the Initial Purchasers to
enter into the Purchase Agreement, the Company and the Subsidiary Guarantors have agreed to provide
to the Initial Purchasers and their direct and indirect transferees the registration rights set
forth in this Agreement. The execution of this Agreement is a condition to the closing under the
Purchase Agreement.

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
acknowledged, the parties hereto covenant and agree as follows:

     1. Definitions.

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

     “1933 Act” shall mean the Securities Act of 1933, as amended from time to time.

     “1934 Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

     “Additional Guarantor” shall mean any subsidiary of the Company that executes a Subsidiary
Guarantee under the Indenture after the date of this Agreement.

     “Additional Interest” shall have the meaning set forth in Section 2.5(a) hereof.

     “Automatic Shelf Registration Statement” shall mean an “automatic shelf registration
statement” as that term is defined in Rule 405, as amended, under the 1933 Act.

     “Business Day” shall mean any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed.

     “Company” shall have the meaning set forth in the preamble and shall also include the
Company’s successors.

 

 

     “Depositary” shall mean The Depository Trust Company, or any other depositary appointed by the
Company; provided, however, that such depositary must have an address in the
Borough of Manhattan, in the City of New York.

     “Effectiveness Period” shall have the meaning set forth in Section 2.2(b).

     “Exchange Date” shall have the meaning set forth in Section 2.1(b)(ii).

     “Exchange Notes” means the Notes to be issued by the Company and guaranteed by the Subsidiary
Guarantors under the Indenture containing terms identical to the respective Notes in all material
respects (except for references to certain interest rate provisions, restrictions on transfers and
restrictive legends), to be offered to Holders of Notes in exchange for Transfer Restricted Notes
pursuant to the Exchange Offer.

     “Exchange Offer” shall mean the exchange offer by the Company and the Subsidiary Guarantors of
Exchange Notes for Transfer Restricted Notes pursuant to Section 2.1 hereof.

     “Exchange Offer Registration” shall mean a registration under the 1933 Act effected pursuant
to Section 2.1 hereof.

     “Exchange Offer Registration Statement” shall mean an exchange offer registration statement on
Form S-4 (or, if applicable, on another appropriate form), and all amendments and supplements to
such registration statement, including the Prospectus contained therein, all exhibits thereto and
all documents incorporated by reference therein.

     “Event Date” shall have the meaning set forth in Section 2.5(b).

     “Free Writing Prospectus” means each free writing prospectus (as defined in Rule 405 under the
1933 Act) prepared by or on behalf of the Company or used or referred to by the Company in
connection with the sale of the Notes or the Exchange Notes.

     “Freely Tradable” shall mean, with respect to a Note, a Note that at any time of determination
(i) may be resold to the public in accordance with Rule 144 under the 1933 Act or any successor
provision thereof (“Rule 144”) without regard to volume, manner of sale or any other restrictions
contained in Rule 144 (other than the holding period requirement in paragraph (d)(1)(ii) of Rule
144 so long as such holding period requirement is satisfied at such time of determination), (ii)
does not bear any restrictive legends relating to the 1933 Act and (iii) does not bear a restricted
CUSIP number.

     “Holder” shall mean an Initial Purchaser, for so long as it owns any Transfer Restricted
Notes, and each of its successors, assigns and direct and indirect transferees who become
registered owners of Transfer Restricted Notes under the Indenture and each Participating
Broker-Dealer that holds Exchange Notes for so long as such Participating Broker-Dealer is required
to deliver a prospectus meeting the requirements of the 1933 Act in connection with any resale of
such Exchange Notes.

     “Indenture” shall mean the Indenture relating to the Notes, dated as of March 16, 2010, among
the Company, the Subsidiary Guarantors, and U.S. Bank National Association, as trustee,

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as the same may be amended, supplemented, waived or otherwise modified from time to time in
accordance with the terms thereof.

     “Initial Purchaser” or “Initial Purchasers” shall have the meaning set forth in the preamble.

     “Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of
outstanding Transfer Restricted Notes; provided that whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Notes is required hereunder, Transfer
Restricted Notes held by the Company and other obligors on the Notes or any Affiliate (as defined
in the Indenture) of the Company or any Subsidiary Guarantor shall be disregarded in determining
whether such consent or approval was given by the Holders of such required percentage amount;
provided, further, that if the Company shall issue any additional Notes under the
Indenture prior to consummation of the Exchange Offer, or if applicable, the effectiveness of any
Shelf Registration Statement or the Transfer Restricted Notes otherwise becoming Freely Tradable,
such additional Notes and the Transfer Restricted Notes to which this Agreement relates shall be
treated together as one class for purposes of determining whether the consent or approval of
Holders of a specified percentage of Transfer Restricted Notes has been obtained.

     “Notes” shall have the meaning set forth in the preamble hereof.

     “Participating Broker-Dealer” shall mean any of the Initial Purchasers and any other
broker-dealer which makes a market in the Notes and exchanges Transfer Restricted Notes in the
Exchange Offer for Exchange Notes.

     “Person” shall mean an individual, partnership (general or limited), corporation, limited
liability company, trust or unincorporated organization, or a government or agency or political
subdivision thereof.

     “Prospectus” shall mean the prospectus included in, or, pursuant to the rules and regulations
of the 1933 Act, deemed a part of, a Registration Statement, including any preliminary prospectus,
and any such prospectus as amended or supplemented by any prospectus supplement, including any such
prospectus supplement with respect to the terms of the offering of any portion of the Transfer
Restricted Notes covered by a Shelf Registration Statement, and by all other amendments and
supplements to a prospectus, including post effective amendments, and in each case including all
material incorporated by reference therein.

     “Purchase Agreement” shall have the meaning set forth in the preamble.

     “Registration Default” shall have the meaning set forth in Section 2.5(a).

     “Registration Expenses” shall mean any and all expenses incident to performance of or
compliance by the Company and the Subsidiary Guarantors with this Agreement, including without
limitation: (i) all SEC, stock exchange or Financial Industry Regulatory Authority (“FINRA”)
registration and filing fees, including, if applicable, the fees and expenses of any “qualified
independent underwriter” that is required to be retained by any holder of Transfer Restricted Notes
in accordance with the rules and regulations of FINRA, (ii) all fees and expenses incurred in
connection with compliance with state securities or blue sky laws and compliance with the

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rules of FINRA (including reasonable fees and disbursements of counsel for any
underwriters or Holders in connection with blue sky qualification of any of the Exchange Notes or
Transfer Restricted Notes and any filings with FINRA), (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and distributing any Registration
Statement, any Prospectus, any amendments or supplements thereto, any underwriting agreements,
securities sales agreements and other documents relating to the performance of and compliance with
this Agreement, (iv) all fees and expenses incurred in connection with the listing, if any, of any
of the Transfer Restricted Notes on any securities exchange or exchanges, (v) all rating agency
fees, (vi) the fees and disbursements of counsel for the Company and the Subsidiary Guarantors and
of the independent public accountants of the Company and the Subsidiary Guarantors, including the
expenses of any special audits or “cold comfort” letters required by or incident to such
performance and compliance, and in the case of a Shelf Registration Statement, the reasonable fees
and disbursements of one counsel for the Holders as a group (which counsel shall be selected by the
Majority Holders and which counsel may also be counsel for the Initial Purchasers); (vii) the fees
and expenses of the Trustee (including the reasonable fees and disbursements of its counsel), and
any escrow agent or custodian, (viii) all fees and disbursements relating to the qualification of
the Indenture under applicable securities laws, and (ix) any fees and disbursements of the
underwriters customarily required to be paid by issuers or sellers of securities and the fees and
expenses of any special experts retained by the Company and the Subsidiary Guarantors in connection
with any Registration Statement, but excluding underwriting discounts and commissions and transfer
taxes, if any, relating to the sale or disposition of Transfer Restricted Notes by a Holder.
Notwithstanding the foregoing, except as specifically provided above, the Company and the
Subsidiary Guarantors shall not be responsible for the fees and expenses of the Initial Purchasers
in connection with the Exchange Offer, or the fees and expenses of counsel to the Initial
Purchasers in connection therewith.

     “Registration Statement” shall mean any registration statement of the Company and the
Subsidiary Guarantors which covers any of the Exchange Notes or Transfer Restricted Notes pursuant
to the provisions of this Agreement, and all amendments and supplements to any such Registration
Statement, including post-effective amendments, in each case including the Prospectus contained
therein or deemed a part thereof, all exhibits thereto and all material incorporated by reference
therein.

     “Registration Trigger Date” means the fifth Business Day following the one-year anniversary of
the date hereof.

     “SEC” shall mean the Securities and Exchange Commission or any successor agency or government
body performing the functions currently performed by the United States Securities and Exchange
Commission.

     “Shelf Registration” shall mean a registration effected pursuant to Section 2.2.

     “Shelf Registration Statement” shall mean a “shelf” registration statement of the Company and
the Subsidiary Guarantors pursuant to the provisions of Section 2.2, including an Automatic
Shelf Registration Statement, if applicable, which covers all or a portion of the Transfer
Restricted Notes on an appropriate form under Rule 415 under the 1933 Act, or any similar rule that
may be adopted by the SEC, and all amendments and supplements to such registration

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statement, including post-effective amendments, in each case including the Prospectus
contained therein or deemed a part thereof, all exhibits thereto and all material incorporated by
reference therein.

     “Shelf Request” shall have the meaning set forth in Section 2.2(a)(iii).

     “Subsidiary Guarantees” shall mean the guarantees of the Notes and the Exchange Notes by the
Subsidiary Guarantors under the Indenture.

     “Subsidiary Guarantors” shall have the meaning set forth in the preamble and shall also
include any Subsidiary Guarantor’s successors and any Additional Guarantors.

     “TIA” shall have the meaning set forth in Section 2.1(d) hereof.

     “Transfer Restricted Notes” shall mean the Notes; provided, however, that the
Notes shall cease to be Transfer Restricted Notes on the earliest to occur of (i) the date on which
a Registration Statement with respect to such Notes has become effective under the 1933 Act and
such Notes have been exchanged or disposed of pursuant to such Registration Statement, (ii) the
date on which such Notes cease to be outstanding under the Indenture or (iii) the date on which
such Notes are Freely Tradable.

     “Trustee” shall mean the trustee with respect to the Notes under the Indenture.

     “Underwriter” shall have the meaning set forth in Section 4(a).

     “WKSI” shall mean a “well-known seasoned issuer” as that term is defined in Rule 405, as
amended, under the 1933 Act.

     2. Registration Under the 1933 Act.

     2.1 Exchange Offer.

     (a) To the extent not prohibited by any applicable law or applicable interpretations of the
staff of the SEC, with respect to any Notes, if any, that on the Registration Trigger Date are
Transfer Restricted Notes, the Company and the Subsidiary Guarantors shall use their reasonable
best efforts to (X) cause to be filed and to become effective an Exchange Offer Registration
Statement covering an offer to the Holders to exchange all the Transfer Restricted Notes for
Exchange Notes and (Y) have such Registration Statement remain effective until 180 days after the
last Exchange Date for use by one or more Participating Broker-Dealers if one or more
broker-dealers notify the Company in writing that they anticipate that they will be Participating
Broker-Dealers. The Company and the Subsidiary Guarantors shall commence the Exchange Offer
promptly after the Exchange Offer Registration Statement is declared effective by the SEC and use
their reasonable best efforts to complete the Exchange Offer not later than 45 days after such
effective date.

     (b) The Company and the Subsidiary Guarantors shall, for the benefit of the Holders, at the
Company’s and Subsidiary Guarantors’ cost, commence the Exchange Offer, if any, by mailing the
related Prospectus, appropriate letters of transmittal and other accompanying docu-

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ments to each Holder stating, in addition to such other disclosures as are required by
applicable law, substantially the following:

     (i) that the Exchange Offer is being made pursuant to this Agreement and that all
Transfer Restricted Notes validly tendered and not properly withdrawn will be accepted for
exchange;

     (ii) the dates of acceptance for exchange (which shall be a period of at least 20
Business Days from the date such notice is mailed) (the “Exchange Dates”);

     (iii) that any Transfer Restricted Notes not tendered will remain outstanding and
continue to accrue interest but will not retain any rights under this Agreement, except as
otherwise specified herein;

     (iv) that any Holder electing to have a Transfer Restricted Note exchanged pursuant to
the Exchange Offer will be required to (A) surrender such Transfer Restricted Note, together
with the appropriate letters of transmittal, to the institution and at the address (located
in the Borough of Manhattan, The City of New York) and in the manner specified in the
notice, or (B) effect such exchange otherwise in compliance with the applicable procedures
of the Depositary, in each case prior to the close of business on the last Exchange Date;
and

     (v) that any Holder will be entitled to withdraw its election, not later than the close
of business on the last Exchange Date, by (A) sending to the institution and at the address
(located in the Borough of Manhattan, The City of New York) specified in the notice, a
telegram, telex, facsimile transmission or letter setting forth the name of such Holder, the
principal amount of Transfer Restricted Notes delivered for exchange and a statement that
such Holder is withdrawing its election to have such Transfer Restricted Notes exchanged or
(B) effecting such withdrawal in compliance with the applicable procedures of the
Depositary.

     (c) Upon the effectiveness of the Exchange Offer Registration Statement, if any, the Company
and the Subsidiary Guarantors shall promptly commence the Exchange Offer, it being the objective of
such Exchange Offer to enable each Holder eligible and electing to exchange Transfer Restricted
Notes for Exchange Notes (assuming that such Holder makes representations and warranties to the
Company that (a) it is not an affiliate of the Company within the meaning of Rule 405 under the
1933 Act, (b) any Exchange Notes to be received by it will be acquired in the ordinary course of
its business, (c) if such Holder is not a broker-dealer, that it is not engaged in, and does not
intend to engage in, the distribution of the Exchange Notes, (d) if such Holder is a broker-dealer
that will receive Exchange Notes for its own account in exchange for Transfer Restricted Notes
acquired as a result of market-making or other trading activities, then such broker-dealer will
deliver a prospectus (or, to the extent permitted by law, make available a Prospectus) in
connection with any resale of such Exchange Notes, and (e) it has no arrangements or understandings
with any Person to participate in the distribution of the Transfer Restricted Notes or the Exchange
Notes) to transfer such Exchange Notes from and after their receipt without any limitations or
restrictions under the 1933 Act and under state securities or blue sky laws.

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     (d) The Exchange Notes, if any, shall be issued under (i) the Indenture or (ii) an indenture
identical in all material respects to the Indenture and which, in either case, has been qualified
under the Trust Indenture Act of 1939, as amended (the “TIA”), or is exempt from such qualification
and shall provide that the Exchange Notes shall not be subject to the transfer restrictions set
forth in the Indenture. The Exchange Notes and the Notes shall vote and consent together on all
matters as one class and none of the Exchange Notes or the Notes will have the right to vote or
consent as a separate class on any matter.

     (e) As soon as practicable after the close of the Exchange Offer, the Company and the
Subsidiary Guarantors shall:

     (i) accept for exchange all Transfer Restricted Notes duly tendered and not validly
withdrawn pursuant to the Exchange Offer in accordance with the terms of the Exchange Offer
Registration Statement and the letter of transmittal which shall be an exhibit thereto;

     (ii) deliver to the Trustee for cancellation all Transfer Restricted Notes so accepted
for exchange; and

     (iii) cause the Trustee promptly to authenticate and deliver Exchange Notes to each
Holder of Transfer Restricted Notes so accepted for exchange in a principal amount equal to
the principal amount of the Transfer Restricted Notes of such Holder so accepted for
exchange.

     (f) Interest on each Exchange Note, including Additional Interest, will accrue (a) from the
later of (i) the last date on which interest was paid on the Transfer Restricted Notes surrendered
in exchange therefor or (ii) if the Transfer Restricted Notes are surrendered for exchange on a
date in a period which includes the record date for an interest payment date to occur on or after
the date of such exchange and as to which interest will be paid, the date of such interest payment
date or (b) if no interest has been paid on the Transfer Restricted Notes, from the date of
issuance. The. Company shall inform the Initial Purchasers of the names and addresses of the
Holders to whom the Exchange Offer is made, and the Initial Purchasers shall have the right, but
not the obligation, to contact such Holders and otherwise facilitate the tender of Transfer
Restricted Notes in the Exchange Offer.

     (g) The Company and the Subsidiary Guarantors shall use their reasonable best efforts to
complete the Exchange Offer as provided above and shall comply with the applicable requirements of
the 1933 Act, the 1934 Act and other applicable laws and regulations in connection with the
Exchange Offer. The Offer shall not be subject to any conditions, other than (1) the Exchange
Offer does not violate any applicable law or applicable interpretations of the staff of the SEC,
(2) no action or proceeding shall have been instituted or threatened in any court or by any
governmental agency with respect to the Exchange Offer and (3) all governmental approvals shall
have been obtained that the Company deems necessary for the consummation of the Exchange Offer.

     2.2 Shelf Registration.

     (a) If,

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     (i) the Company and the Subsidiary Guarantors would otherwise be required to consummate
an Exchange Offer Registration pursuant to Section 2.1 but determine that such Exchange
Offer Registration is not available or the Exchange Offer may not be completed as soon as
practicable after the last Exchange Date because it would violate any applicable law, SEC
rules and regulations or any interpretation of the staff of the SEC,

     (ii) the Exchange Offer is not for any other reason completed by the 45th day following
the date the Exchange Offer Registration Statement is declared effective, or

     (iii) any Initial Purchaser notifies the Company that it holds Transfer Restricted
Notes that, in the opinion of counsel for such Holder, are not Freely Tradable on the
Registration Trigger Date (a “Shelf Request”):

the Company and the Subsidiary Guarantors shall promptly deliver to the Holders and the Trustee
written notice thereof and shall use their reasonable best efforts to cause to be filed as soon as
practicable after such determination, date or Shelf Request, as the case may be, a Shelf
Registration Statement providing for the sale of all the Transfer Restricted Notes by the Holders
thereof and to have such Shelf Registration Statement become effective by the 30th day following
such determination date or Shelf Request.

     (b) In the event that the Company and the Subsidiary Guarantors are required to file a Shelf
Registration Statement, the Company and the Subsidiary Guarantors agree to use their reasonable
best efforts to keep the Shelf Registration Statement continuously effective, supplemented and
amended (including through post-effective amendments on Form S-3 if the Company is eligible to use
such Form) until no Notes covered by such Shelf Registration Statement constitute Transfer
Restricted Notes (the “Effectiveness Period”). The Company and the Subsidiary Guarantors agree to
furnish to the Holders of Transfer Restricted Notes listed in the Shelf Registration Statement and
the related Prospectus copies of any such supplement or amendment promptly after its being used or
filed with the SEC.

     (c) The Company represents, warrants and covenants that it (including its agents and
representatives) will not prepare, make, use, authorize, approve or refer to any Free Writing
Prospectus.

     (d) Notwithstanding any other provisions hereof, the Company and the Subsidiary Guarantors
shall use their reasonable best efforts to ensure that (i) any Shelf Registration Statement and any
amendment thereto and any Prospectus forming a part thereof and any supplement thereto complies in
all material respects with the 1933 Act and the rules and regulations thereunder, (ii) any Shelf
Registration Statement and any amendment thereto does not, when it becomes effective, contain an
untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading and (iii) any Prospectus forming part of
any Shelf Registration Statement, and any supplement to such Prospectus (as amended or supplemented
from time to time), does not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements, in the light of the circumstances under
which they were made, not misleading.

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     (e) The Company and the Subsidiary Guarantors shall not permit any securities other than
Transfer Restricted Notes to be included in the Shelf Registration Statement; provided,
however, that if the offer and sale of the Transfer Restricted Notes is registered pursuant
to an Automatic Shelf Registration Statement, the foregoing prohibition shall apply only to the
supplement or amendment covering such registration. The Company and the Subsidiary Guarantors
agree, if necessary, to supplement or amend the Shelf Registration Statement, as required by
Section 3(b) below, and to furnish to the Holders of Transfer Restricted Notes copies of
any such supplement or amendment promptly after its being used or filed with the SEC.

     (f) If the Company is obligated to file a Shelf Registration Statement pursuant to this
Section 2.2, and at the time such obligation arises, the Company is a WKSI, then, in lieu
of filing such Shelf Registration Statement, the Company shall file an Automatic Shelf Registration
Statement or supplement or amend an existing Automatic Shelf Registration Statement, as
appropriate, to include the offer and sale of the Transfer Restricted Notes by the Holders from
time to time in accordance with the methods of distribution elected by the Majority Holders
participating in such registration and set forth in such Automatic Shelf Registration Statement (or
supplement or amendment thereto), within the time frame specified in this Section 2.2.

     2.3 Expenses. The Company and the Subsidiary Guarantors shall pay all Registration
Expenses in connection with the registration pursuant to Sections 2.1 and 2.2.
Each Holder shall pay all underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of such Holder’s Transfer Restricted Notes pursuant to the
Shelf Registration Statement.

     2.4 Effectiveness.

     (a) The Company and the Subsidiary Guarantors will be deemed not to have used their reasonable
best efforts to cause the Exchange Offer Registration Statement or the Shelf Registration
Statement, as the case may be, to become, or to remain, effective during the requisite period if
either the Company or any Subsidiary Guarantor voluntarily takes any action that would, or omits to
take any action which omission would, result in any such Registration Statement not being declared
effective, or in the Holders of Transfer Restricted Notes covered thereby not being able to
exchange or offer and sell such Transfer Restricted Notes during that period as and to the extent
contemplated hereby, unless such action is required by applicable law, in each case other than
under the circumstances described in Sections 3(e)(iii), (iv), (v) or
(vi) below.

     (b) Neither an Exchange Offer Registration Statement pursuant to Section 2.1 hereof
nor a Shelf Registration Statement pursuant to Section 2.2 hereof, if not otherwise
effective upon filing with the SEC as provided by Rule 462, will be deemed to have become effective
unless it has been declared effective by the SEC; provided, however, that if, after
it becomes effective, the offering of Transfer Restricted Notes pursuant to an Exchange Offer
Registration Statement or a Shelf Registration Statement is interfered with by any stop order,
injunction or other order or requirement of the SEC or any other governmental agency or court, such
Registration Statement will not be effective during the period of such interference, until the
offering of Transfer Restricted Notes pursuant to such Registration Statement may legally resume.

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     2.5 Additional Interest.

     (a) In the event that (i) an Exchange Offer Registration Statement is required pursuant to
Section 2.1 and (x) such Exchange Offer Registration Statement does not become effective on
or prior to the Registration Trigger Date or (y) the Exchange Offer is not completed within 45 days
after the date on which the Exchange Offer Registration Statement becomes effective, or (ii) a
Shelf Registration Statement is required in accordance with Section 2.2 and such Shelf
Registration Statement (x) does not become effective on or prior to the 90th day following (A) the
date of such determination, in the case of a Shelf Registration Statement required pursuant to
Section 2.2(a)(i), (B) such date, in the case of a Shelf Registration Statement required
pursuant to Section 2.2(a)(ii), or (C) the date of such Shelf Request, in the case of a
Shelf Registration Statement required pursuant to Section 2.2(a)(iii), or (y) becomes
effective but ceases to be effective or the corresponding Prospectus ceases to be usable at any
time during the Effectiveness Period, and such failure to remain effective or usable exists for
more than 60 days (whether or not consecutive) in any 12-month period (any event referred to in the
foregoing clauses (i) or (ii) a “Registration Default”), then, in each case, the
interest rate on the Transfer Restricted Notes will be increased by 0.25% per annum for the first
90-day period immediately following such Registration Default and (ii) an additional 0.25% per
annum with respect to each subsequent 90-day period, up to a maximum of 1.00% per annum, in each
case until the earlier of the date such Registration Default is cured or the date on which no Notes
constitute Transfer Restricted Notes. Any amounts payable under this paragraph shall also be
deemed “Additional Interest” for purposes of this Agreement.

     (b) The Company shall notify the Trustee within three Business Days after each and every date
on which an event occurs in respect of which Additional Interest is required to be paid (an “Event
Date”). Any Additional Interest due shall be payable on each interest payment date to the Holder
of Notes with respect to which Additional Interest is due and owing. Each obligation to pay
Additional Interest shall be deemed to accrue from and including the day following the applicable
Event Date.

     3. Registration Procedures.

     In connection with the obligations of the Company and the Subsidiary Guarantors with respect
to Registration Statements pursuant to Sections 2.1 and 2.2 hereof, the Company and
the Subsidiary Guarantors shall:

     (a) prepare and file with the SEC a Registration Statement, within the relevant time
periods specified in Sections 2.1 and 2.2, on the appropriate form under the
1933 Act and the rules promulgated thereunder, which form (i) shall be selected by the
Company, (ii) shall, in the case of a Shelf Registration, be available for the sale of the
Transfer Restricted Notes by the selling Holders thereof, (iii) shall comply as to form in
all material respects with the requirements of the applicable form and include or
incorporate by reference all financial statements required by the SEC to be filed therewith
or incorporated by reference therein, (iv) shall comply in all respects with the
requirements of Regulation S-T under the 1933 Act and (v) use their reasonable best efforts
to cause such Registration Statement to become effective and remain effective for the
applicable period in accordance with Sections 2.1 and 2.2 hereof,

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     (b) prepare and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary under applicable law to keep such Registration
Statement effective for the applicable period; and cause each Prospectus to be supplemented
by any required prospectus supplement, and as so supplemented to be filed pursuant to Rule
424 (or any similar provision then in force) under the 1933 Act and comply with the
provisions of the 1933 Act, the 1934 Act and the rules and regulations thereunder applicable
to them with respect to the disposition of all securities covered by each Registration
Statement during the applicable period in accordance with the intended method or methods of
distribution by the selling Holders thereof (including sales by any Participating
Broker-Dealer); and keep each Prospectus current during the period described in Section 4(3)
of and Rule 174 under the 1933 Act that is applicable to transactions by brokers or dealers
with respect to the Transfer Restricted Notes or Exchange Notes;

     (c) in the case of a Shelf Registration, (i) notify each Holder of Transfer Restricted
Notes to be covered thereby, at least five Business Days prior to filing, that a Shelf
Registration Statement (except in the case of an Automatic Shelf Registration Statement, in
which case at least five Business Days prior to the inclusion of information regarding
selling securityholders in the Prospectus forming a part of such Automatic Shelf
Registration Statement) with respect to such Transfer Restricted Notes is being filed and
advising such Holders that the distribution of such Transfer Restricted Notes will be made
in accordance with the method selected by the Majority Holders participating in the Shelf
Registration; (ii) furnish to each Holder of Transfer Restricted Notes to be covered thereby
and to each underwriter of an underwritten offering of Transfer Restricted Notes, if any,
without charge, as many copies of each Prospectus, including each preliminary Prospectus,
and any amendment or supplement thereto and such other documents as such Holder or
underwriter may reasonably request, including financial statements and schedules and, if the
Holder so requests, all exhibits in order to facilitate the public sale or other disposition
of the Transfer Restricted Notes; and (iii) do hereby consent to the use of the Prospectus
or any amendment or supplement thereto by each of the selling Holders of Transfer Restricted
Notes in connection with the offering and sale of the Transfer Restricted Notes covered by
the Prospectus or any amendment or supplement thereto;

     (d) use their reasonable best efforts to register or qualify the Transfer Restricted
Notes under all applicable state securities or “blue sky” laws of such jurisdictions as any
Holder of Transfer Restricted Notes covered by a Registration Statement and each underwriter
of an underwritten offering of Transfer Restricted Notes shall reasonably request by the
time the applicable Registration Statement is declared effective by the SEC, cooperate with
such Holders in connection with any filings required to be made with FINRA, and do any and
all other acts and things which may be reasonably necessary or advisable to enable each such
Holder and underwriter to consummate the disposition in each such jurisdiction of such
Transfer Restricted Notes owned by such Holder; provided, however, that the
Company and the Subsidiary Guarantors shall not be required to (i) qualify as a foreign
corporation or as a dealer in securities in any jurisdiction where they would not otherwise
be required to qualify but for this Section 3(d), or (ii) take any

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action which would subject them to general service of process or taxation in any such
jurisdiction where they are not then so subject;

     (e) notify promptly each Holder of Transfer Restricted Notes under a Shelf Registration
or any Participating Broker-Dealer who has notified the Company that it is utilizing the
Exchange Offer Registration Statement as provided in clause (f) below and, if requested by
such Holder or Participating Broker-Dealer, confirm such advice in writing promptly (i) when
a Registration Statement has become effective and when any post-effective amendments and
supplements to a Registration Statement have become effective, (ii) of any request by the
SEC or any state securities authority for post-effective amendments and supplements to a
Registration Statement and Prospectus or for additional information after the Registration
Statement has become effective, (iii) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, including the receipt by the Company of any
notice of objection of the SEC to the use of a Shelf Registration Statement or any
post-effective amendment thereto pursuant to Rule 401(g)(2) under the 1933 Act, (iv) in the
case of a Shelf Registration, if, between the effective date of a Registration Statement and
the closing of any sale of Transfer Restricted Notes covered thereby, the representations
and warranties of the Company and the Subsidiary Guarantors contained in any underwriting
agreement, securities sales agreement or other similar agreement, if any, relating to the
offering cease to be true and correct in all material respects, (v) of the happening of any
event or the discovery of any facts during the period a Shelf Registration Statement is
effective which makes any statement made in such Registration Statement or the related
Prospectus untrue in any material respect or which requires the making of any changes in
such Registration Statement or Prospectus in order to make the statements therein not
misleading, (vi) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Transfer Restricted Notes or the Exchange Notes, as
the case may be, for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose and (vii) of any determination by the Company that a
post-effective amendment to such Registration Statement would be appropriate;

     (f) in the case of the Exchange Offer Registration Statement (i) include in the
Exchange Offer Registration Statement a section entitled “Plan of Distribution” which
section shall be in customary form, and which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC with respect to the potential
“underwriter” status of any broker-dealer that holds Transfer Restricted Notes acquired for
its own account as a result of market-making activities or other trading activities and that
will be the beneficial owner (as defined in Rule 13d-3 under the 1934 Act) of Exchange Notes
to be received by such broker-dealer in the Exchange Offer, whether such positions or
policies have been publicly disseminated by the staff of the SEC or such positions or
policies represent the prevailing views of the staff of the SEC, including a statement that
any such broker-dealer who receives Exchange Notes for Transfer Restricted Notes pursuant to
the Exchange Offer may be deemed a statutory underwriter and must deliver a prospectus
meeting the requirements of the 1933 Act in connection with any resale of such Exchange
Notes, (ii) furnish to each Participating Broker-Dealer who has delivered to the Company the
notice referred to in Section 3(e), without charge, as many copies of

-12-

 

each Prospectus included in the Exchange Offer Registration Statement, including any
preliminary prospectus, and any amendment or supplement thereto, as such Participating
Broker Dealer may reasonably request, (iii) do hereby consent to the use of the Prospectus
forming part of the Exchange Offer Registration Statement or any amendment or supplement
thereto, by any Person subject to the prospectus delivery requirements of the SEC, including
all Participating Broker-Dealers, in connection with the sale or transfer of the Exchange
Notes covered by the Prospectus or any amendment or supplement thereto, and (iv) include in
the transmittal letter or similar documentation to be executed by an exchange offeree in
order to participate in the Exchange Offer (x) the following provision:

“If the exchange offeree is a broker-dealer holding
Transfer Restricted Notes acquired for its own account as a result of
market-making activities or other trading activities, it will deliver
a prospectus meeting the requirements of the 1933 Act in connection
with any resale of Exchange Notes received in respect of such Transfer
Restricted Notes pursuant to the Exchange Offer;” and

(y) a statement to the effect that by a broker-dealer’s making the acknowledgment
described in clause (x) and by delivering a Prospectus in connection with the
exchange of Transfer Restricted Notes, the broker-dealer will not be deemed to admit
that it is an underwriter within the meaning of the 1933 Act;

     (g) make every reasonable effort to obtain the withdrawal of any order suspending the
effectiveness of a Registration Statement at the earliest possible moment, and, in the case
of a Shelf Registration, the resolution of any objection of the SEC pursuant to Rule
401(g)(2), including by filing an amendment to such Shelf Registration Statement on the
proper form, at the earliest possible moment and provide immediate notice to each Holder of
the withdrawal of any such order or such resolution;

     (h) in the case of a Shelf Registration, furnish to each Holder of Transfer Restricted
Notes, and each underwriter, if any, without charge, at least one conformed copy of each
Registration Statement and any post-effective amendment thereto, including financial
statements and schedules (without documents incorporated therein by reference and all
exhibits thereto, unless requested);

     (i) in the case of a Shelf Registration, cooperate with the selling Holders of Transfer
Restricted Notes to facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Notes to be sold and not bearing any restrictive legends;
and enable such Transfer Restricted Notes to be in such denominations (consistent with the
provisions of the Indenture) and registered in such names as the selling Holders or the
underwriters, if any, may reasonably request at least three Business Days prior to the
closing of any sale of Transfer Restricted Notes;

     (j) in the case of a Shelf Registration, upon the occurrence of any event or the
discovery of any facts, each as contemplated by Sections 3(e)(v) and (vi)
hereof, as promptly as practicable after the occurrence of such an event, use their
reasonable best

-13-

 

efforts to prepare and file with the SEC a supplement or post-effective amendment to
the Registration Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered to the
purchasers of the Transfer Restricted Notes or Participating Broker-Dealers, such Prospectus
will not contain at the time of such delivery any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading or will remain so
qualified. At such time as such public disclosure is otherwise made or the Company
determines that such disclosure is not necessary, in each case to correct any misstatement
of a material fact or to include any omitted material fact, the Company and the Subsidiary
Guarantors agree promptly to notify each Holder of such determination and to furnish each
Holder such number of copies of the Prospectus as amended or supplemented, as such Holder
may reasonably request;

     (k) in the case of a Shelf Registration Statement, a reasonable time prior to the
filing of any Registration Statement, any Prospectus, any amendment to a Registration
Statement or amendment or supplement to a Prospectus or of any document that is to be
incorporated by reference into a Registration Statement or a Prospectus after the initial
filing of a Registration Statement, provide copies of such document to the Initial
Purchasers on behalf of such Holders; and make representatives of the Company and the
Subsidiary Guarantors as shall be reasonably requested by the Holders of Transfer Restricted
Notes, or the Initial Purchasers on behalf of such Holders, available for discussion of such
document; and the Company and the Subsidiary Guarantors shall not, at any time after initial
filing of a Registration Statement, use or file any Prospectus, any amendment of or
supplement to a Registration Statement, or any document that is to be incorporated by
reference into a Registration Statement or a Prospectus, of which the Initial Purchasers
shall not have previously been advised and furnished a copy or to which the Initial
Purchasers shall reasonably object;

     (l) obtain a CUSIP number for all Exchange Notes or Transfer Restricted Notes, as the
case may be, not later than the effective date of a Registration Statement, and provide the
Trustee with certificates for the Exchange Notes or the Transfer Restricted Notes, as the
case may be, in a form eligible for deposit with the Depositary;

     (m) (i) in the case of a Shelf Registration, cause the Indenture to be qualified under
the TIA in connection with the registration of the Transfer Restricted Notes, and, in the
case of an Exchange Offer Registration, cause or maintain, as the case may be, the Indenture
to be qualified under the TIA in connection with the registration of the Exchange Notes,
(ii) cooperate with the Trustee and the Holders to effect such changes to the Indenture as
may be required for the Indenture to be, or continue to be, so qualified in accordance with
the terms of the TIA and (iii) execute, and use their reasonable best 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;

     (n) in the case of a Shelf Registration, enter into agreements (including underwriting
agreements) and take all other customary and appropriate actions in order to

-14-

 

expedite or facilitate the disposition of such Transfer Restricted Notes and if so
requested by the holders of such Transfer Restricted Notes and in such connection whether or
not an underwriting agreement is entered into and whether or not the registration is an
underwritten registration:

     (i) make such representations and warranties to the Holders of such Transfer
Restricted Notes and the underwriters, if any, as the Company and the Subsidiary
Guarantors are able to make, in form, substance and scope as are customarily made by
issuers to underwriters in similar underwritten offerings as may be reasonably
requested by them;

     (ii) in connection with an underwritten registration, obtain opinions of
counsel to the Company and the Subsidiary Guarantors and updates thereof (which
counsel and opinions (in form, scope and substance) shall be reasonably satisfactory
to the managing underwriters, if any, and the holders of a majority in principal
amount of the Transfer Restricted Notes being sold) addressed to each selling Holder
and the underwriters, if any, covering the matters customarily covered in opinions
requested in sales of securities or underwritten offerings and such other matters as
may be reasonably requested by such Holders and underwriters;

     (iii) in connection with an underwritten registration, obtain “cold comfort”
letters and updates thereof from the Company’s and the Subsidiary Guarantors’
independent certified public accountants (and, if necessary, any other independent
certified public accountants of any subsidiary of the Company or of any business
acquired by the Company for which financial statements are, or are required to be,
included in the Registration Statement) addressed to the underwriters, if any, and
use reasonable efforts to have such letter addressed to the selling Holders of
Transfer Restricted Notes (to the extent consistent with Statement on Auditing
Standards No. 72 of the American Institute of Certified Public Accountants), such
letters to be in customary form and covering matters of the type customarily covered
in “cold comfort” letters to underwriters in connection with similar underwritten
offerings;

     (iv) enter into a securities sales agreement with the Holders and an agent of
the Holders providing for, among other things, the appointment of such agent for the
selling Holders for the purpose of soliciting purchases of Transfer Restricted
Notes, which agreement shall be in form, substance and scope customary for similar
offerings;

     (v) if an underwriting agreement is entered into, cause the same to set forth
indemnification provisions and procedures substantially equivalent to the
indemnification provisions and procedures set forth in Section 4 hereof with
respect to the underwriters and all other parties to be indemnified pursuant to said
Section or, at the request of any underwriters, in the form customarily provided to
such underwriters in similar types of transactions; and

-15-

 

     (vi) deliver such documents and certificates as may be reasonably requested and
as are customarily delivered in similar offerings to the Holders of a majority in
principal amount of the Transfer Restricted Notes being sold and the managing
underwriters, if any.

The above shall be done at (i) the effectiveness of such Shelf Registration
Statement (and each post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder;

     (o) in the case of a Shelf Registration or if a Prospectus is required to be delivered
by any Participating Broker-Dealer in the case of an Exchange Offer, make available for
inspection by representatives of the Holders of the Transfer Restricted Notes, any
underwriters participating in any disposition pursuant to a Shelf Registration Statement,
any Participating Broker-Dealer and any counsel or accountant retained by any of the
foregoing, all non-confidential financial and other records, pertinent corporate documents
and properties of the Company or any Subsidiary Guarantor reasonably requested by any such
persons, and cause the respective officers, directors, employees, and any other agents of
the Company and the Subsidiary Guarantors to supply all information reasonably requested by
any such representative, underwriter, special counsel or accountant in connection with a
Registration Statement, and make such representatives of the Company and the Subsidiary
Guarantors available for discussion of such documents as shall be reasonably requested by
such persons;

     (p) if so requested by the Initial Purchasers, in the case of an Exchange Offer
Registration Statement, a reasonable time prior to filing of any Exchange Offer Registration
Statement, any Prospectus forming a part thereof, any amendment to an Exchange Offer
Registration Statement or amendment or supplement to such Prospectus, provide copies of such
document to the Initial Purchasers and to counsel to the Holders of Transfer Restricted
Notes;

     (q) in the case of a Shelf Registration, a reasonable time prior to filing any Shelf
Registration Statement, any Prospectus forming a part thereof, any amendment to such Shelf
Registration Statement or amendment or supplement to such Prospectus, provide copies of such
documents to the Initial Purchasers, if so requested, to the Holders of Transfer Restricted
Notes to be covered thereby, to counsel for such Holders designated by them and to the
underwriter or underwriters of an underwritten offering of such Transfer Restricted Notes,
if any, make such changes in any such document prior to the filing thereof relating to such
Holders or such Transfer Restricted Notes as the counsel to the Holders or the underwriter
or underwriters reasonably request and not file any such document in a form to which the
Majority Holders of Transfer Restricted Notes covered by such Shelf Registration Statement,
counsel for such Holders of Transfer Restricted Notes covered by such Shelf Registration
Statement, or any underwriter shall not have previously been advised and furnished a copy of
or to which the Majority Holders of Transfer Restricted Notes covered by such Shelf
Registration Statement, counsel to such Holders of Transfer Restricted Notes or any
underwriter shall reasonably object, and make the representatives of the Company and the
Subsidiary Guarantors available for discussion of

-16-

 

such document as shall be reasonably
requested by such Holders of Transfer Restricted Notes, the counsel for such Holders of Transfer Restricted Notes or any
underwriter;

     (r) in the case of a Shelf Registration, use their reasonable best efforts to cause all
Transfer Restricted Notes to be listed on any securities exchange on which similar debt
securities issued by the Company and the Subsidiary Guarantors are then listed if requested
by the Majority Holders of such Transfer Restricted Notes covered by such Shelf Registration
Statement, or if requested by the underwriter or underwriters of an underwritten offering of
Transfer Restricted Notes, if any;

     (s) in the case of a Shelf Registration, use their reasonable best efforts to cause the
Transfer Restricted Notes to be rated by the appropriate rating agencies, if so requested by
the Majority Holders of the Transfer Restricted Notes covered by such Shelf Registration
Statement, or if requested by the underwriter or underwriters of an underwritten offering of
Transfer Restricted Notes, if any;

     (t) otherwise comply with all applicable rules and regulations of the SEC and make
available to their security holders, as soon as reasonably practicable, an earnings
statement covering at least 12 months which shall satisfy the provisions of Section 11(a) of
the 1933 Act and Rule 158 thereunder;

     (u) cooperate and assist in any filings required to be made with FINRA and, in the case
of a Shelf Registration, in the performance of any due diligence investigation by any
underwriter and its counsel (including any “qualified independent underwriter” that is
required to be retained in accordance with the rules and regulations of FINRA);

     (v) if reasonably requested by any Holder of Transfer Restricted Notes covered by a
Shelf Registration Statement, promptly include in a Prospectus supplement or post-effective
amendment such information with respect to such Holder as such Holder reasonably requests to
be included therein and make all required filings of such Prospectus supplement or such
posteffective amendment as soon as the Company has received notification of the matters to
be so included in such filing;

     (w) so long as any Transfer Restricted Notes remain outstanding, cause each Additional
Guarantor upon such Person becoming an Additional Guarantor, to execute a joinder to this
Agreement and to deliver such joinder to the Initial Purchasers no later than five Business
Days following the execution thereof; and

     (x) amend or supplement the Prospectus contained in the Exchange Offer Registration
Statement for a period of up to 180 days after the last Exchange Date (as such period may be
extended pursuant to this Agreement), in order to expedite or facilitate the disposition of
any Exchange Notes by Participating Broker-Dealers consistent with the positions of the
staff of the SEC. The Company and the Subsidiary Guarantors agree that Participating
Broker-Dealers shall be authorized to deliver such Prospectus (or, to the extent permitted
by law, make available) during such period in connection with the resales contemplated by
this clause (x).

-17-

 

     In the case of a Shelf Registration Statement, the Company and the Subsidiary Guarantors may
(as a condition to such Holder’s participation in the Shelf Registration) require each Holder of
Transfer Restricted Notes to furnish to the Company and Subsidiary Guarantors such information
regarding the Holder and the proposed distribution by such Holder of such Transfer Restricted Notes
as the Company and Subsidiary Guarantors may from time to time reasonably request in writing.

     In the case of a Shelf Registration Statement, each Holder agrees that, upon receipt of any
notice from the Company or any Subsidiary Guarantor of the happening of any event or the discovery
of any facts, each of the kind described in Section 3(e)(iii) or (vi) hereof, such
Holder will forthwith discontinue disposition of Transfer Restricted Notes pursuant to a
Registration Statement until such Holder’s receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 3(k) hereof, and, if so directed by the Company and
Subsidiary Guarantors, such Holder will deliver to the Company and Subsidiary Guarantors (at its
expense) all copies in such Holder’s possession, other than permanent file copies then in such
Holder’s possession, of the Prospectus covering such Transfer Restricted Notes current at the time
of receipt of such notice.

     If any of the Transfer Restricted Notes covered by any Shelf Registration Statement are to be
sold in an underwritten offering, the underwriter or underwriters and manager or managers that will
manage such offering will be selected by the Majority Holders of such Transfer Restricted Notes to
be included in such offering and shall be acceptable to the Company and Subsidiary Guarantors. No
Holder of Transfer Restricted Notes may participate in any underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder’s Transfer Restricted Notes on the basis provided
in any underwriting arrangements approved by the persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such underwriting
arrangements.

     If the Company and the Subsidiary Guarantors shall give any notice to suspend the disposition
of Transfer Restricted Notes pursuant to a Registration Statement, the Company and the Subsidiary
Guarantors shall extend the period during which such Registration Statement shall be maintained
effective pursuant to this Agreement by the number of days during the period from and including the
date of the giving of such notice to and including the date when the Holders of such Transfer
Restricted Notes shall have received copies of the supplemented or amended Prospectus necessary to
resume such dispositions. The Company and the Subsidiary Guarantors may give any such notice only
twice during any 365-day period and any such suspensions shall not exceed 45 days for each
suspension and there shall not be more than two suspensions in effect during any 365-day period.

     4. Indemnification; Contribution.

     (a) The Company and the Subsidiary Guarantors agree to indemnify, jointly and severally, and
hold harmless the Initial Purchasers and each of their affiliates and any other Person under common
control with the Initial Purchasers, each Holder, each Participating Broker-Dealer, each Person who
participates as an underwriter (any such Person being an “Underwri-

-18-

 

ter”) and each Person, if any, who controls any Holder or Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

     (i) against any and all loss, liability, claim, damage and expense whatsoever, as
incurred, arising out of any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement (or any amendment or supplement thereto) pursuant to
which Exchange Notes or Transfer Restricted Notes were registered under the 1933 Act,
including all documents incorporated therein by reference, any Free Writing Prospectus used
in violation of this Agreement or any “issuer information” filed or required to be filed
pursuant to Rule 433(d) under the 1933 Act, or the omission or alleged omission therefrom of
a material fact required to be stated therein or necessary to make the statements therein
not misleading, or arising out of any untrue statement or alleged untrue statement of a
material fact contained in any 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 4(d)
below) any such settlement is effected with the written consent of the Company and the
Subsidiary Guarantors; and

     (iii) against any and all expense whatsoever, as incurred (including the fees and
disbursements of counsel chosen by any indemnified party), 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
subparagraph (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 concerning any Holder or Underwriter furnished to the Company by the Holder or
Underwriter expressly for use in a Registration Statement (or any amendment thereto) or any
Prospectus (or any amendment or supplement thereto); and provided, further, that
the indemnity agreement contained in this subsection shall not inure to the benefit of any Holder
or Participating Broker-Dealer from whom the person asserting any such losses, claims, damages or
liabilities purchased the Notes concerned, to the extent that a prospectus relating to such Notes
was required to be delivered by such Holder or Participating Broker-Dealer under the 1933 Act in
connection with such purchase and any such loss, claim, damage or liability of such Holder or
Participating Broker-Dealer results from the fact that there was not sent or given to such person,
at or prior to the sale of such Notes to such person, a copy of such prospectus if the Company had
previously furnished copies thereof to such Holder or Participating Broker-Dealer.

-19-

 

     (b) Each Holder, severally, but not jointly, agrees to indemnify and hold harmless the
Company, the Subsidiary Guarantors, each Underwriter and the other selling Holders, and each of
their respective directors and officers, and each Person, if any, who controls the Company, any
Subsidiary Guarantor, any Underwriter or any other selling Holder within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act, against any and all loss, liability, claim, damage
and expense described in the indemnity contained in Section 4(a) hereof, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Shelf Registration Statement (or any amendment thereto) or any Prospectus included
therein (or any amendment or supplement thereto) in reliance upon and in conformity with written
information with respect to such Holder furnished to the Company and the Subsidiary Guarantors by
such Holder expressly for use in the Shelf Registration Statement (or any amendment thereto) or
such Prospectus (or any amendment or supplement thereto); provided, however, that
no such Holder shall be liable for any claims hereunder in excess of the amount of net proceeds
received by such Holder from the sale of Transfer Restricted Notes pursuant to such Shelf
Registration Statement.

     (c) Each indemnified party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action or proceeding commenced against it in respect of which indemnity
may be sought hereunder, but failure so to 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. An indemnifying party may participate at its own
expense in the defense of such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party) also be counsel to
the indemnified party. In no event shall the indemnifying party or parties be liable for the fees
and expenses of more than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general allegations or
circumstances. 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 4 (whether or not the indemnified parties are actual or potential
parties thereto), unless such settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) 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 the indemnification provided for in this Section 4, 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 Company and the Subsidiary Guarantors, on the one hand, and the Holders
and the Initial Purchasers, 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.

-20-

 

     The relative fault of the Company and the Subsidiary Guarantors on the one hand and the
Holders and 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, the
Subsidiary Guarantors, the Holders or the Initial Purchasers and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such statement or omission.

     The Company, the Subsidiary Guarantors, the Holders and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 4 were determined
by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose)
or by any other method of allocation which does not take account of the equitable considerations
referred to above in this Section 4. The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in this Section
4 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.

     No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
1933 Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation.

     For purposes of this Section 4, each Person, if any, who controls an Initial Purchaser
or Holder within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as such Initial Purchaser or Holder, and each director of the
Company or any Subsidiary Guarantor, and each Person, if any, who controls the Company or any
Subsidiary Guarantor within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
shall have the same rights to contribution as the Company and the Subsidiary Guarantors. The
Initial Purchasers’ respective obligations to contribute pursuant to this Section 4 are
several in proportion to the principal amount of Notes set forth opposite their respective names in
Schedule A to the Purchase Agreement and not joint. Notwithstanding the provisions of this
Section 4, in no event shall a Holder be required to contribute any amount in excess of the
amount by which the total price at which all of the Notes sold by such Holder exceeds the amount of
any damages that such Holder has otherwise been required to pay under Section 4(b) hereof.

     The remedies provided for in this Section 4 are not exclusive and shall not limit any
rights or remedies that may otherwise be available to any indemnified party at law or in equity.

     The indemnity and contribution provisions contained in this Section 4 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of the Initial Purchasers or any Holder or any Person
controlling any Initial Purchaser or any Holder, or by or on behalf of the Company or the
Guarantors or the officers or directors of or any Person controlling the Company or the Guarantors,
(iii) acceptance of any of the Exchange Notes and (iv) any sale of Transfer Restricted Notes
pursuant to a Shelf Registration Statement; provided, however, that the indemnity
and contribution rights pro-

-21-

 

vided for, in this Section 4 shall not extend to any losses, liabilities or other
damages arising out of actions occurring after the termination of this Agreement.

     5. Miscellaneous.

     5.1 Rule 144 and Rule 144A. For so long as the Company and the Subsidiary Guarantors
are subject to the reporting requirements of Section 13 or 15 of the 1934 Act, the Company and the
Subsidiary Guarantors covenant that they will file and furnish the reports required to be filed by
them under the 1933 Act and Section 13(a) or 15(d) of the 1934 Act and the rules and regulations
adopted by the SEC thereunder. If the Company and the Subsidiary Guarantors cease to be so
required to file and furnish such reports, the Company and Subsidiary Guarantors covenant that they
will upon the request of any Holder of Transfer Restricted Notes (a) make publicly available such
information as is necessary to permit sales pursuant to Rule 144 under the 1933 Act, (b) deliver
such information to a prospective purchaser as is necessary to permit sales pursuant to Rule 144A
under the 1933 Act and take such further action as any Holder of Transfer Restricted Notes may
reasonably request, and (c) take such further action that is reasonable in the circumstances, in
each case, to the extent required from time to time to enable such Holder to sell its Transfer
Restricted Notes without registration under the 1933 Act within the limitation of the exemptions
provided by (i) Rule 144 under the 1933 Act, as such Rule may be amended from time to time, (ii)
Rule 144A under the 1933 Act, as such Rule may be amended from time to time, or (iii) any similar
rules or regulations hereafter adopted by the SEC. Upon the request of any Holder of Transfer
Restricted Notes, the Company and the Subsidiary Guarantors will deliver to such Holder a written
statement as to whether they have complied with such requirements.

     5.2 No Inconsistent Agreements. The Company and the Subsidiary Guarantors have not
entered into, and the Company and the Subsidiary Guarantors will not after the date of this
Agreement enter into, any agreement which is inconsistent with the rights granted to the Holders of
Transfer Restricted Notes in this Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not and will not for the term of this Agreement in any
way conflict with the rights granted to the holders of the Company’s or Subsidiary Guarantors’
other issued and outstanding securities under any such agreements.

     5.3 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 and the Subsidiary
Guarantors have obtained the written consent of the Majority Holders affected by such amendment,
modification, supplement, waiver or departure.

     5.4 Notices. All notices and other communications provided for or permitted hereunder
shall be made in writing by hand delivery, registered first-class mail, telex, telecopier, or any
courier guaranteeing overnight delivery (a) if to a Holder, at the most current address given by
such Holder to the Company by means of a notice given in accordance with the provisions of this
Section 5.4, which address initially, and until so changed, is the address set forth in the
Purchase Agreement with respect to the Initial Purchasers; and (b) if to the Company and the
Subsidiary Guarantors, initially at the Company’s address set forth in the Purchase Agreement, and

-22-

 

thereafter at such other address of which notice is given in accordance with the provisions of
this Section 5.4.

     All such notices and communications shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; two Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt is acknowledged, if
telecopied; and on the next Business Day if timely delivered to an air courier guaranteeing
overnight delivery.

     Copies of all such notices, demands, or other communications shall be concurrently delivered
by the person giving the same to the Trustee under the Indenture at the address specified therein.

     5.5 Successor 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 Transfer
Restricted Notes in violation of the terms of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Notes, in any manner, whether by
operation of law or otherwise, such Transfer Restricted Notes shall be held subject to all of the
terms of this Agreement, and by taking and holding such Transfer Restricted Notes 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, including the restrictions on resale set forth in this Agreement and, if
applicable, the Purchase Agreement, and such person shall be entitled to receive the benefits
hereof. The Initial Purchasers (in their capacity as Initial Purchasers) shall have no liability
or obligation to the Company or the Subsidiary Guarantors with respect to any failure by a Holder
to comply with, or any breach by any Holder of, any of the obligations of such Holder under this
Agreement

     5.6 Third Party Beneficiaries. The Initial Purchasers (even if the Initial Purchasers
are not Holders of Transfer Restricted Notes) shall be third party beneficiaries to the agreements
made hereunder between the Company and the Subsidiary Guarantors, on the one hand, and the Holders,
on the other hand, and shall have the right to enforce such agreements directly to the extent they
deem such enforcement necessary or advisable to protect their rights or the rights of Holders
hereunder. Each Holder of Transfer Restricted Notes shall be a third party beneficiary to the
agreements made hereunder between the Company and the Subsidiary Guarantors, on the one hand, and
the Initial Purchasers, on the other hand, and shall have the right to enforce such agreements
directly to the extent it deems such enforcement necessary or advisable to protect its rights
hereunder.

     5.7 Specific Enforcement. Without limiting the remedies available to the Initial
Purchasers and the Holders, the Company and the Subsidiary Guarantors acknowledge that any failure
by the Company or the Subsidiary Guarantors to comply with their obligations under Sections
2.1 through 2.4 hereof may result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at law, that it would not be
possible to measure damages for such injuries precisely and that, in the event of any such failure,
the Initial Pur-

-23-

 

chasers or any Holder may obtain such relief as may be required to specifically enforce the
Company’s and Subsidiary Guarantors’ obligations under Sections 2.1 through 2.4
hereof.

     5.8 Restriction on Resales. Until the expiration of one year after the original
issuance of the Notes and the Guarantees, the Company and the Subsidiary Guarantors will not, and
will cause their “affiliates” (as such term is defined in Rule 144(a)(1) under the 1933 Act) not
to, resell any Notes and Subsidiary Guarantees which are “restricted securities” (as such term is
defined under Rule 144(a)(3) under the 1933 Act) that have been reacquired by any of them and shall
immediately upon any purchase of any such Notes and Subsidiary Guarantees submit such Notes and
Subsidiary Guarantees to the Trustee for cancellation.

     5.9 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. This
Agreement may be executed by facsimile signature.

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

     5.11 Governing Law. This Agreement shall be governed by and construed in accordance
with the law of the state of Nevada without regard to the principles of conflict of laws thereof.

     5.12 Severability. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable,
the validity, legality and enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.

     5.13 Agreement Regarding Tracinda. The Initial Purchasers hereby agree that in the
event (i) there is any breach or default or alleged breach or default by the Company under this
Agreement or (ii) the Initial Purchasers have or may have any claim arising from or relating to the
terms hereof, the Initial Purchasers shall not commence any lawsuit or otherwise seek to impose any
liability whatsoever against Kirk Kerkorian or Tracinda Corporation (collectively, “Tracinda”),
unless Tracinda shall have commenced a lawsuit or otherwise initiated any claim against the Initial
Purchasers arising from or relating to this Agreement (a “Tracinda Action”). The Initial
Purchasers hereby further agree that unless a Tracinda Action has been commenced: (i) Tracinda
shall not have any liability whatsoever with respect to this Agreement or any matters relating to
or arising from this Agreement, including any alleged breach of or default under this Agreement by
the Company; and (ii) the Initial Purchasers shall not assert or permit any party claiming through
it to assert a claim or impose any liability against Tracinda as to any matter or thing arising out
of or relating to this Agreement or any alleged breach or default under this Agreement by the
Company. In addition, the Initial Purchasers agree that Tracinda is not a party to this Agreement.

[signature page follows]

-24-

 

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

	 	 	 	 	 
	 	MGM MIRAGE,

a Delaware corporation

 	 
	 	By:  	/s/ John M. McManus
 	 
	 	 	Name:  	John M. McManus 	 
	 	 	Title:  	Senior Vice President, Acting

General Counsel and Secretary 	 

 

 

	 	 	 	 	 

Joined in and agreed to and accepted by the

following Subsidiary Guarantors as of the date first above written:

	 	 	 
	1.

	 	350 Leasing Company I, LLC, a Nevada limited liability company
	2.

	 	350 Leasing Company II, LLC, a Nevada limited liability company
	3.

	 	550 Leasing Company I, LLC, a Nevada limited liability company
	4.

	 	AC Holding Corp., a Nevada corporation
	5.

	 	AC Holding Corp. II, a Nevada corporation
	6.

	 	Aria Resort & Casino, LLC, a Nevada limited liability company
	7.

	 	Beau Rivage Distribution Corp., a Mississippi corporation
	8.

	 	Beau Rivage Resorts, Inc., a Mississippi corporation
	9.

	 	Bellagio, LLC, a Nevada limited liability company
	10.

	 	Bungalow, Inc., a Mississippi corporation
	11.

	 	Circus Circus Casinos, Inc., a Nevada corporation
	12.

	 	Circus Circus Mississippi, Inc., a Mississippi corporation
	13.

	 	CityCenter Realty Corporation, a Nevada corporation
	14.

	 	Destron, Inc., a Nevada corporation
	15.

	 	Diamond Gold, Inc., a Nevada corporation
	16.

	 	Galleon, Inc., a Nevada corporation
	17.

	 	Gold Strike Aviation, Incorporated, a Nevada corporation
	18.

	 	Gold Strike Fuel Company, LLC, a Nevada limited liability company (successor in interest to
Gold Strike Fuel Company, a Nevada Partnership)
	19.

	 	Gold Strike L.V., a Nevada partnership
	 
	 	By: Diamond Gold Inc., a Nevada corporation, Partner

	 

	 	By: M.S.E. Investments, Incorporated, a Nevada corporation, Partner

	20.

	 	Grand Laundry, Inc., a Nevada corporation
	21.

	 	IKM MGM Management, LLC, a Nevada limited liability company
	22.

	 	IKM MGM, LLC, a Nevada limited liability company
	23.

	 	Jean Development Company, LLC, a Nevada limited liability company (successor in interest to
Jean Development Company, a Nevada partnership)
	24.

	 	Jean Development North, LLC, a Nevada limited liability company (successor in interest to
Jean Development North, a Nevada partnership)
	25.

	 	Jean Development West, LLC, a Nevada limited liability company (successor in interest to Jean
Development West, a Nevada partnership)
	26.

	 	Jean Fuel Company West, LLC, a Nevada limited liability company (successor in interest to
Jean Fuel Company West, a Nevada partnership)
	27.

	 	LV Concrete Corp., a Nevada corporation
	28.

	 	MAC, Corp., a New Jersey corporation
	29.

	 	Mandalay Corp., a Nevada corporation
	30.

	 	Mandalay Employment, LLC, a Nevada limited liability company
	31.

	 	Mandalay Marketing and Events, a Nevada corporation
	32.

	 	Mandalay Place, a Nevada corporation
	33.

	 	Mandalay Resort Group, a Nevada corporation
	34.

	 	Metropolitan Marketing, LLC, a Nevada limited liability company
	35.

	 	MGM Grand Atlantic City, Inc., a New Jersey corporation
	36.

	 	MGM Grand Condominiums, LLC, a Nevada limited liability company
	37.

	 	MGM Grand Condominiums II, LLC, a Nevada limited liability company

S-2

 

	 	 	 
	38.

	 	MGM Grand Condominiums III, LLC, a Nevada limited liability company
	39.

	 	MGM Grand Condominiums East — Tower 1, LLC, a Nevada limited liability company
	40.

	 	MGM Grand Detroit, Inc., a Delaware corporation
	41.

	 	MGM Grand Hotel, LLC, a Nevada limited liability company
	42.

	 	MGM Grand New York, LLC, a Nevada limited liability company
	43.

	 	MGM Grand Resorts, LLC, a Nevada limited liability company
	44.

	 	MGM Grand Resorts Development, a Nevada corporation
	45.

	 	MGM MIRAGE Advertising, Inc., a Nevada corporation
	46.

	 	MGM MIRAGE Aircraft Holdings, LLC, a Nevada limited liability company
	47.

	 	MGM MIRAGE Aviation Corp., a Nevada corporation
	48.

	 	MGM MIRAGE Corporate Services, a Nevada corporation
	49.

	 	MGM MIRAGE Design Group, a Nevada corporation
	50.

	 	MGM MIRAGE Development, LLC, a Nevada limited liability company
	51.

	 	MGM MIRAGE Entertainment and Sports, a Nevada corporation
	52.

	 	MGM MIRAGE International Marketing, Inc., a Nevada corporation
	53.

	 	MGM MIRAGE Land Holdings, LLC, a Nevada limited liability company
	54.

	 	MGM MIRAGE Management and Technical Services, LLC, a Nevada limited liability company
	55.

	 	MGM MIRAGE Manufacturing Corp., a Nevada corporation
	56.

	 	MGM MIRAGE Operations, Inc., a Nevada corporation
	57.

	 	MGM MIRAGE Retail, a Nevada corporation
	58.

	 	MH, Inc., a Nevada corporation
	59.

	 	M.I.R. Travel, a Nevada corporation
	60.

	 	The Mirage Casino-Hotel, a Nevada corporation
	61.

	 	Mirage Laundry Services Corp., a Nevada corporation
	62.

	 	Mirage Leasing Corp., a Nevada corporation
	63.

	 	Mirage Resorts, Incorporated, a Nevada corporation
	64.

	 	MMNY Land Company, Inc., a New York corporation
	65.

	 	MRGS, LLC, a Nevada limited liability company (successor in interest to MRGS Corp., a Nevada
corporation)
	66.

	 	M.S.E. Investments, Incorporated, a Nevada corporation
	67.

	 	Nevada Landing Partnership, an Illinois partnership
	 

	 	By: Diamond Gold Inc., a Nevada corporation, Partner

	 

	 	By: M.S.E. Investments, Incorporated, a Nevada corporation, Partner

	68.

	 	New Castle Corp., a Nevada corporation
	69.

	 	New PRMA Las Vegas, Inc., a Nevada corporation
	70.

	 	New York-New York Hotel & Casino, LLC, a Nevada limited liability company
	71.

	 	New York-New York Tower, LLC, a Nevada limited liability company
	72.

	 	OE Pub, LLC, a Nevada limited liability company
	73.

	 	PRMA Land Development Company, a Nevada corporation
	74.

	 	PRMA, LLC, a Nevada limited liability company
	75.

	 	Project CC, LLC, a Nevada limited liability company
	76.

	 	Railroad Pass Investment Group, LLC, a Nevada limited liability company (successor in
interest to Railroad Pass Investment Group, a Nevada partnership)
	77.

	 	Ramparts, Inc., a Nevada corporation
	78.

	 	The Signature Condominiums, LLC, a Nevada limited liability company

S-3

 

	 	 	 
	79.

	 	Signature Tower 2, LLC, a Nevada limited liability company
	80.

	 	Signature Tower 3, LLC, a Nevada limited liability company
	81.

	 	Signature Tower I, LLC, a Nevada limited liability company
	82.

	 	The Crystals at CityCenter Management, LLC, a Nevada limited liability company
	83.

	 	Tower B, LLC, a Nevada limited liability company
	84.

	 	Tower C, LLC, a Nevada limited liability company
	85.

	 	Vdara Condo Hotel, LLC, a Nevada limited liability company
	86.

	 	Victoria Partners, a Nevada partnership
	 

	 	By: MRGS LLC, a Nevada limited liability company, Partner

	 

	 	By: Gold Strike L.V., a Nevada partnership, Partner

	87.

	 	VidiAd, a Nevada corporation
	88.

	 	Vintage Land Holdings, LLC, a Nevada limited liability company
	89.

	 	Vintage Land Holdings II, LLC, a Nevada limited liability company

[The remainder of this page is intentionally left blank. Signature on the following page.]

S-4

 

	 	 	 	 	 
	 	 	 
	 	By:  	                                                /s/ John M. McManus
 	 
	 	 	Name:  	John M. McManus 	 
	 	 	Title:  	Assistant Secretary or

Attorney-in-Fact, as applicable,

of each of the foregoing 	 

S-5

 

	 	 	 	 	 

	 	 	 	 	 
	CONFIRMED AND ACCEPTED,

as of the date first above written:

BANC OF AMERICA SECURITIES LLC

 	 	 
	By:  	/s/ John Cokinos
 	 	 
	 	Name:  	John Cokinos 	 	 
	 	Title:  	Managing Director 	 	 
	 

For itself and as representative of the other Initial Purchasers

S-6

 

Schedule A

Initial Purchaser

Banc of America Securities LLC

RBS Securities Inc.

Barclays Capital Inc.

J.P. Morgan Securities Inc.

BNP Paribas Securities Corp.

Daiwa Securities America Inc.

Citigroup Global Markets Inc.

Deutsche Bank Securities Inc.

UBS Securities LLC

Commerzbank Capital Markets Corp.

Morgan Stanley & Co. Incorporated

Wells Fargo Securities, LLC

Comerica Securities, Inc.

Scotia Capital (USA) Inc.

U.S. Bancorp. Investments, Inc.Exhibit 10.1

Exhibit 10.1

MANUFACTURING LICENSE AGREEMENT

This Manufacturing License Agreement (the “Agreement”) is made and entered into as of this
13th day of August, 2009 by and between InnoZen, Inc., a Delaware corporation with offices at 6429
Independence Avenue, Woodland Hills, California (“InnoZen”) and Supplemental Manufacturing &
Ingredients, LLC., dba SMI Manufacturing, an Arizona limited liability company with offices at 2401
West 1st Street, Tempe, Arizona (“SMI”).

RECITALS

WHEREAS, InnoZen has experience in the formulation, development, manufacturing, distribution
and sale of edible thin film-strips containing dietary supplement, nutraceutical, and drug active
ingredients;

WHEREAS, SMI has begun and desires to design, build and operate a state-of-the-art, cGMP,
edible film-strip manufacturing facility in Arizona.

WHEREAS, SMI desires to manufacture InnoZen’s edible film-strip products in its Arizona
facility.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, InnoZen and SMI agree as follows:

I. DEFINITIONS

As used in this Agreement, the following terms, whether used in the singular or plural, shall
have the following meanings:

1.1. “Affiliate” shall mean any company or other business entity controlled by, controlling or
under common control with a party, control being presumed if there is direct or indirect ownership
of at least 35% (or, if less, the maximum permitted by applicable law) of the voting stock, equity
or income interest.

1.2. “Change of Control Transaction” shall mean a transaction (i) in which a Party sells
ownership of 50% or more of all of its classes of voting securities or ownership interests to a
single investor or group of related investors, or (ii) in which a Party sells all or substantially
all of its assets.

1.3. “Cost” shall mean the actual cost of goods sold associated with the manufacture of a
particular Product based on generally accepted accounting principles.

1.4. “FDA” shall mean the United States Food and Drug Administration (or a successor agency).

1.5. “Field” shall mean the sale of the Products to InnoZen or its Affiliates.

 

 

 

1.6. “Force Majeure” shall mean a failure to fulfill a requirement under this Agreement due to
fire, flood, strike or other labor dispute, accident to machinery, act of sabotage, riot,
precedence or priority granted at the request of or for the benefit, directly or indirectly, of any
government, including but not limited to the United States of America federal or state, or a
Territory, foreign government or any subdivision or agency thereof, export. or import restriction,
delay in transportation or lack of transportation, facilities, restriction imposed by United States
of America federal or state or a Territory, foreign legislation or rule or regulation there under,
or war or insurrection or any cause beyond the control of either party.

1.7. “GMP” shall mean current good manufacturing practices as defined under FDA and other
regulatory authority rules and regulations and that are applicable to the manufacture of the
Products.

1.8. “Licensed Technology” shall mean (i) all Patent Rights, (ii) all intellectual property,
derivatives, know-how, trade secrets, processes and data, including, but not limited to,
formulations, manufacturing procedures, and specifications owned or possessed by InnoZen as of the
date of this Agreement relating to the Manufacture and commercialization of the Products but only
to the extent such information and data is necessary to commercially exploit the Products in the
Field.

1.9. “Manufacture” shall mean the production and making of the Products by labor and
machinery, but shall not include any making or production of the Products related to research and
development activities or functions.

1.10. “Party” shall mean SMI or InnoZen; “Parties” shall mean SMI and InnoZen.

1.11. “Patent Applications” shall mean United States non-provisional patent application U.S.
Serial No. 10/713,544 filed on November 14, 2003, United States non-provisional patent application
U.S. Serial No. 10/402,273 filed on March 28, 2003, United States non-provisional patent
application U.S. Serial No. 10/921,770 filed on August 18, 2004, United States non-provisional
patent application U.S. Serial No. 11/417,676 filed on May 3, 2006, United States non-provisional
patent application U.S. Serial No. 11/371,167 filed on March 7, 2006, and United States provisional
patent application U.S. Serial No. 60/981,389 filed on October 19, 2007 (collectively, the “Patent
Applications”); all United States and foreign patents and patent applications deriving priority
from the Provisional Applications, and any divisions, continuations, continuations-in-part,
re-examinations and reissues of such patent applications.

1.12. “Patent Rights” shall mean all rights arising in connection with the Patent
Applications, and any patents ultimately issued in connection therewith.

1.13. “Product” or “Products” shall mean any commercial, edible film-strip product that
utilizes the Patent Rights or Licensed Technology.

1.14. “Territory” shall mean world-wide, except that, it shall not include South
Korea. In the case of South Korea, the Parties intend to enter into a joint venture or other
business relationship for the development of the South Korean market and the manufacture and supply
of edible film strip products in South Korea.

 

- 2 -

 

II. MANUFACTURING LICENSE

2.1. License. Subject to (i) the termination provisions set forth in Section 2.3 herein, (ii)
the reservation of rights set forth in Section 2.4 herein, and (iii) the other terms of this
Agreement, InnoZen hereby grants to SMI a non-exclusive license in and to the Patent Rights and the
Licensed
Technology to Manufacture the Products in the Territory for the Field and other customers
authorized in writing by InnoZen.

2.2. Term of License. The non-exclusive license granted in Section 2.1 herein shall be for a
term of twelve (12) years, unless terminated earlier under the terms of this Agreement. In
addition, upon mutual agreement of the Parties, the Agreement may be extended for an additional
twelve (12) year term.

2.3. Termination of License.

(a) SMI shall provide to InnoZen a quarterly report relating to its GMP status and to its
federal, state, and local regulatory certification and authorization. In the event that SMI loses
its GMP status or its certification or authorization under any federal, state or local regulatory
authority, and after written notice thereof is provided by InnoZen, then, in addition to all other
rights and remedies under this Agreement and otherwise available at law, InnoZen shall have the
right, at its option, to temporarily suspend or terminate the license granted in Section 2.1
whereupon such license shall be temporarily suspended or terminated. If SMI is unable to regain
its GMP status or its regulatory certification or authorization for a period of sixty (60) days
after written notice thereof is provided by InnoZen, then, all rights granted to SMI by InnoZen
under this Agreement (including without limitation all Patent Rights and Product and Licensed
Technology rights) shall terminate, become null and void, and shall revert in their entirety to
InnoZen, and InnoZen may, in its sole option, terminate this Agreement in its entirety.

(b) In the event SMI materially breaches or fails to perform any provision of this Agreement
and such material breach or failure continues for a period of thirty (30) days after written notice
thereof is provided by InnoZen, then, in addition to all other rights and remedies under this
Agreement and otherwise available at law, InnoZen shall have the right, at its option, to
temporarily suspend or terminate the license granted in Section 2.1 whereupon such license shall be
temporarily suspended or terminated. If there occurs any other or additional material breach or
failure of SMI to perform its duties under this Agreement within six (6) months after the date of
the initial material breach or failure to perform (excluding any cure period) or at any time
thereafter if the initial material breach or failure to perform remains uncured, all rights granted
to SMI by InnoZen under this Agreement (including without limitation all Patent Rights and Product
and Licensed Technology rights) shall terminate, become null and void, and shall revert in their
entirety to InnoZen, and InnoZen may, in its sole discretion, terminate this Agreement in its
entirety.

2.4. Reservation of Rights. InnoZen retains all rights in and to the Products, the Patent
Rights and all of the Licensed Technology not specifically granted in
Section 2.1. herein.
Consequently, in addition to other rights that SMI shall not have, SMI shall not have the right to
use, distribute, offer for sale, or sell the Products to any entity other than InnoZen or those
InnoZen designees approved and appointed by InnoZen in writing.

2.5. Reversion. Upon termination of this Agreement, SMI shall return and deliver to InnoZen
the Patent Rights, the Licensed Technology and all other information relating to the grant of the
license rights in Section 2.1, herein.

 

- 3 -

 

III. MANUFACTURING / SUPPLY

3.1. Facility and Equipment. SMI intends to design, build, and operate a state-of-the-art,
GMP, FDA-approved facility in Arizona, capable of manufacturing edible film-strip products
utilizing InnoZen’s Licensed Technology and Patent Rights (the “Arizona Facility”). The
Arizona Facility project is slated to begin prior to execution of this Agreement, and is projected
to contain up to four (4) production lines capable of producing dietary supplement,
over-the-counter drug, and pharmaceutical drug products from raw materials through to finished
goods. The first production line will utilize certain equipment from InnoZen’s Oxnard, California
facility (the “First Line”). InnoZen shall retain title to such equipment and shall have the right
to mark or label the equipment, file UCC financing statements or take other action reasonably
necessary to protect its ownership interest in such equipment. SMI shall have the right to use
such equipment during the term of this Agreement and shall maintain such equipment in good working
order, reasonable wear and tear expected. InnoZen agrees to provide all reasonably required and
agreed upon assistance in getting the First Line operational as soon as reasonably practicable.
The remaining production lines at the Arizona Facility are scheduled to be operational as soon as
reasonably practical given the lead times required in obtaining the associated equipment to be
ordered and purchased by SMI. SMI’s commitments and obligations under this Agreement to build,
equip, validate and operate these remaining production lines is based and contingent upon InnoZen
providing reasonable written order forecasts supported by written customer commitment indications
supporting the financial viability of the additional investment required to build and operate the
remaining production lines. The Parties agree that unless Product orders exist, are pending or are
reasonably forecast by InnoZen that will fully utilize the First Line’s capacity, there will not be
a commercially reasonable need for the remaining production lines.

3.2. Failure to Build/Operate Facility. Notwithstanding the provisions of Section 3.1 herein,
in the event that the First Line is not operational or is not capable of producing commercially
sellable Product from the raw material and blending stage of production through to the packaging
and finished goods stages within six (6) months of the execution of this Agreement and provided
that such delay or failure is not due to InnoZen’s breach of any material provision under this
Agreement, then, in addition to all other rights and remedies under this Agreement and otherwise
available at law, InnoZen shall have the right, at its option, to terminate this Agreement in its
entirety.

3.3. Exclusive Manufacturing — Right of First Refusal. Subject to (i) the terms set forth in
Section 3.4 herein, (ii) the termination provisions set forth in Section 3.5 herein, and (iii) the
other terms of this Agreement, SMI shall have the first right to exclusively negotiate with InnoZen
for the Manufacture of the Products in the Territory for the Field (the “Right of First Refusal”).

3.4. Exercise of Right of First Refusal. The Right of First Refusal shall operate on a
Product-by-Product basis, and SMI shall exercise the Right of First Refusal for each Product
separately. InnoZen shall notify SMI in writing of its intent to commercially exploit a particular
Product and shall provide SMI a dossier for each such Product which contains the Product
formulation, specifications, requirements, manufacturing procedures and other information necessary
for SMI to Manufacture the Product. SMI shall then have ten (10) days from receipt of such
notification in which to exercise the Right of First Refusal for such Product and shall inform
InnoZen in writing of its decision to exercise the Right of First Refusal for such Product. Upon
SMI’s notification of its decision to exercise the Right of First Refusal for such Product, the
Parties shall immediately begin good faith negotiations for the Manufacture of such Product under a
separate Manufacturing Agreement as provided in Section 3.6 herein.

 

- 4 -

 

3.5. Termination of Right of First Refusal.

(a) In the event that SMI (i) refuses to manufacture a particular Product, (ii) fails to
fulfill a purchase order for a particular Product, or (iii) is unable to meet all product
specifications, capacity requirements, quality requirements, manufacturing requirements, reasonable
customer requirements, or regulatory requirements related to a particular Product and such
refusal, failure or inability continues for a period of thirty (30) days after written notice
thereof is provided by InnoZen, then, in addition to all other rights and remedies under this
Agreement and otherwise available at law, InnoZen shall have the right, at its option, to revoke
and terminate the Right of First Refusal for that particular Product and the Right of First Refusal
for that particular Product shall be null and void. In such event, and without limiting any other
InnoZen rights and remedies, InnoZen shall have the right to grant to any person(s) or entity(ies)
the right and license to manufacture the particular Product and to do the foregoing itself. This
Section 3.5(a) shall apply and be enforceable at all times during the term of this Agreement
including both prior to SMI’s exercise of the Right of First Refusal for the particular Product and
after the exercise of such Right of First Refusal for the particular Product.

(b) SMI shall provide to InnoZen a quarterly report relating to its GMP status and to its
federal, state, and local regulatory certification and authorization. In the event that SMI loses
its GMP status or its certification or authorization under any federal, state or local regulatory
authority, and after written notice thereof is provided by InnoZen then, in addition to all other
rights and remedies under this Agreement and otherwise available at law, InnoZen shall have the
right, at its option, to revoke and terminate the Right of First Refusal for all Products and the
Right of First Refusal for all Products shall be null and void until such time as SMI is able to
regain its GMP status or its regulatory certification or authorization. In such event, and without
limiting any other InnoZen rights and remedies, InnoZen shall have the right to grant to any
person(s) or entity(ies) the right and license to manufacture the Products and to do the foregoing
itself. If SMI’s failure to maintain its GMP status or its regulatory certification or
authorization remains uncured for a period of sixty (60) days after written notice thereof is
provided by InnoZen, then, all rights granted to SMI by InnoZen under this Agreement (including
without limitation all Right of First Refusal rights, Patent Rights and Product and Licensed
Technology rights) shall terminate, become null and void, and shall revert in their entirety to
InnoZen, and InnoZen may, in its sole option, terminate this Agreement in its entirety. This
Section 3.5(b) shall apply and be enforceable at all times during the term of this Agreement
including both prior to SMI’s exercise of the Right of First Refusal for any Products and after the
exercise of such Right of First Refusal for any Products.

(c) In the event SMI materially breaches or fails to perform any provision of this Agreement
and such material breach or failure continues for a period of thirty (30) days after written notice
thereof is provided by InnoZen, then, in addition to all other rights and remedies under this
Agreement and otherwise available at law, InnoZen shall have the right, at its option, to revoke
and terminate the Right of First Refusal for all Products and the Right of First Refusal for all
Products shall be null and void until such time as SMI is able to cure such breach. In such event,
and without limiting any other InnoZen rights and remedies, InnoZen shall have the right to grant
to any person(s) or entity(ies) the right and license to manufacture the Products, and to do the
foregoing itself. If there occurs any other or additional material breach or failure of SMI to
perform its duties under this Agreement within six (6) months after the date of the initial
material breach or failure to perform (excluding any cure period) or at any time thereafter if the
initial material breach or failure to perform remains uncured, all rights granted to SMI by InnoZen
under this Agreement (including without limitation all Right of First Refusal rights, Patent Rights
and Product and Licensed Technology rights) shall terminate, become null and void, and shall revert
in their entirety to InnoZen, and InnoZen may, in its sole option, terminate this Agreement in its
entirety. This Section 3.5(c) shall apply and be enforceable at all times during the term of this
Agreement including both prior to SMI’s exercise of the Right of First Refusal for any Products and
after the exercise of such Right of First Refusal for any Products.

 

- 5 -

 

3.6. Manufacturing Agreements. The manufacturing relationship between the Parties shall be
governed by this Agreement and by a separate Manufacturing Agreement to be negotiated by the
parties in good faith for each particular Product. Each such Manufacturing Agreement shall be in
the form attached hereto as Exhibit A and shall contain the standard provisions
therein, including but not limited to, provisions relating to payment terms,
forecasting/projections, purchase orders, shipping, product specifications, and product returns.
In the event of a conflict between this Agreement and any Manufacturing Agreement, the provisions
of this Agreement shall govern.

3.7. Pricing. The Parties shall negotiate (in good faith) and agree upon the price for each
Product that will be charged to InnoZen by SMI for any orders placed by InnoZen on its own behalf
or on behalf of an InnoZen designated third party. The Parties hereby agree to use best efforts to
negotiate a price for each Product that is low enough to be competitive in the industry. In the
event that the Parties are unable to agree upon a price for any Product, the Parties hereby agree
that for any such Product orders placed by InnoZen on its own behalf or on behalf of an InnoZen
designated third party, SMI shall only charge InnoZen for the Cost of such order plus a fee of
[***] of such Cost.

3.8. Audit Rights; Records. SMI shall keep, or cause to be kept, accurate books, records and
data in sufficient detail to verify the calculation of Cost under Sections 1.3 and 3.7 herein and
shall retain such books, records and data at its principal place of business for at least five (5)
years after the end of the fiscal year to which they pertain. InnoZen shall have the right, at its
expense and not more frequently than once per quarter, to have its accountants and/or auditors
examine, during normal business hours, all books, records and data of SMI or its Affiliates
relating to the calculation of Cost for any period during which SMI is required to keep the books,
records and data. If such examination discovers an error in excess of three percent (3%) for the
period under review, SMI shall reimburse InnoZen for its reasonable costs of audit and examination.

3.9. No Competing Products/Technology. Except as pursuant to this Agreement, SMI, its
Affiliates, or its subsidiaries shall not manufacturer, produce or otherwise fabricate any edible
film-strip products or technology of any sort without the prior written consent of InnoZen. Any
violation of this Section 3.9 by SMI shall be considered a material default according to Section
8.1 herein.

3.10. First Right of Negotiation. In the event that a Party intends to enter negotiations or
has, in fact, entered into negotiations for a Change of Control Transaction, then such Party shall
notify the other Party in writing of such intent or action as soon as reasonably practicable. The
notified Party shall then have thirty (30) days from the date of such notice in which to enter
competing negotiations or to propose its own offer for a Change of Control Transaction. Each Party
agrees that during the thirty (30) day period it shall not enter into a binding agreement to effect
a Change of Control Transaction with any third party purchaser. It is understood and agreed,
however, that at any time following the expiration of the thirty (30) day period a Party may enter
into a Change of Control Transaction with a third party purchaser on such terms as the Party may
approve in its sole and absolute discretion.

IV. LICENSE FEE, INVESTMENT AND KEY PERSONNEL

4.1. License Fee. In consideration of the rights granted to SMI by InnoZen hereunder, and the
other undertakings of InnoZen herein, SMI shall pay $150,000 to InnoZen upon execution of the
Agreement. The $100,000 previously paid in connection with the Parties’ Letter of Intent shall be
applied to this license fee. The remaining $50,000 of the license fee shall be paid within ninety
(90) days of execution of this Agreement. Such license fee is non-refundable and shall be made to
InnoZen by check or wire transfer.

 

- 6 -

 

4.2. Subscription. In consideration of the rights granted to SMI by InnoZen hereunder, SMI
hereby subscribes and agrees to purchase $1,000,000 worth of shares of common stock of
HealthSport, Inc., the parent corporation of InnoZen, at a per share price of $0.235 (the
“Subscription”). The payment of the purchase price for the shares shall be made in installments as
follows:

a.) $150,000 on or before August 15, 2009;

b.) $150,000 on or before September 15, 2009;

c.) $150,000 on or before October 15, 2009;

d.) $150,000 on or before November 15, 2009;

e.) $400,000 on or before December 31, 2009.

The shares purchased with each scheduled installment payment shall not be fully paid for until the
entire purchase price is paid for such shares. InnoZen shall have the right to hold the stock
certificates for such shares until such shares are fully paid. In connection with the
Subscription, SMI represents and warrants to InnoZen as follows: (a) SMI is an accredited investor
as that term is defined in Regulation D promulgated under the Securities Act of 1933, (b) SMI is
purchasing the shares for its own account and for investment purposes, (c) SMI has conducted its
own due diligence investigation concerning the investment in the shares and is not relying upon any
representation or warranty of InnoZen or HealthSport which is not contained in this Agreement, (d)
SMI acknowledge that the shares will not have been registered under the Securities Act of 1933 and
therefore will be subject to, and will bear “restricted legends” with respect to certain
restrictions on transfer. Failure by SMI to transfer all monies according to the dates and
schedule set forth in this Section 4.2 shall be considered a material default according to Section
8.1 herein. In the event of such a default, and after termination of this Agreement under Section
8.1 or other provisions of this Agreement, InnoZen shall, in its sole option (i) demand specific
performance of performance by SMI to complete the payment for the shares, or (ii) terminate this
Agreement and any other related documents in their entirety, without obligation other than to
provide share certificates for any shares fully paid by SMI.

4.3. Key Personnel. The Parties recognize and agree that the successful performance of the
Agreement will require the services and expertise of the key InnoZen personnel listed in
Exhibit B, hereto (the “Key Personnel”). Accordingly, the Parties will make all
commercially reasonable efforts to negotiate and execute a consulting agreement simultaneously with
this Agreement whereby SMI pays a monthly consulting fee to InnoZen for the services and expertise
of the Key Personnel (the “Consulting Agreement”). The Consulting Agreement shall be in the form
attached hereto as Exhibit C. The Parties hereby agree that the total of fees payable by
SMI under this Consulting Agreement shall be a minimum of $40,000 and that such amount shall be
payable to InnoZen in four (4) equal monthly installments with the first such payment due thirty
(30) days after the date of execution of the Agreement.

4.4. Taxes. Each Party agrees to bear all of the sales and use taxes imposed as a result of
the existence or operation of this Agreement on each Party, including any tax on or measured by
sales or other payment.

V. LICENSED TECHNOLOGY AND PATENT RIGHTS

5.1. Ownership.

(a) All works of authorship, discoveries, improvements and inventions made, authored, or
invented by InnoZen, and/or any of its Affiliates in the performance of this Agreement
or which otherwise relates to the Product, the Patent Rights and/or the Licensed Technology
(collectively, “InnoZen Improvements”) shall be owned by InnoZen.

 

- 7 -

 

5.2. Infringement.

(a) Each Party shall promptly notify in writing the other Party during the term of this
Agreement of any: (1) known infringement or suspected infringement of any of the Patent Rights; or
(2) unauthorized use or misappropriation of the Licensed Technology by a third party of which it
becomes aware, and shall provide the other Party with all available evidence supporting said
infringement, suspected infringement or unauthorized use or misappropriation. Within ninety (90)
days after InnoZen becomes, or is made aware of any of the foregoing, InnoZen shall decide whether
or not to initiate an infringement or other appropriate action and shall notify SMI of its decision
in writing. The failure of InnoZen to inform SMI of InnoZen’s decision within such ninety (90) day
period shall be deemed a decision not to initiate an infringement or other appropriate action.
Notwithstanding anything else herein to the contrary, InnoZen agrees to and does hereby commit to
defend, indemnify and hold SMI harmless against and from any third party actions claiming or
challenging SMI’s right to Manufacture Products for the Field to the extent that such claim alleges
that the Licensed Technology infringes intellectual property rights owned by a third party.

(b) In the event that InnoZen notifies SMI of its intent to initiate an infringement or other
appropriate action within the ninety (90) day period provided in Section 6.2(a), provided such
infringement is continuing, InnoZen shall initiate such an infringement or other appropriate action
within thirty (30) days of the end of such 90-day period. InnoZen shall be entitled to join SMI as
a party to such suit, but SMI shall be under no obligation to participate except to the extent that
such participation is required as the result of being a named party to the suit or being involved
in the commercialization of any Patent Rights and/or Licensed Technology at issue. If SMI chooses
to participate, SMI shall have the right to be represented by its own counsel at its own expense.
InnoZen shall not settle any such suit involving rights of SMI nor make an admission of liability
on behalf of SMI without obtaining the prior written consent of SMI, which consent shall not be
unreasonably withheld. In the event InnoZen initiates proceedings pursuant to this Section 6.2(b),
InnoZen shall be entitled to 100% of any and all amounts recovered in such suit, whether through
judgment, settlement or otherwise, including without limitation, any punitive damages that may be
awarded, up to the amount of InnoZen’s costs of suit, and InnoZen and SMI shall each be entitled to
50% of all amounts recovered in such suit, whether through judgment, settlement or otherwise,
including without limitation, any punitive damages that may be awarded, in excess of InnoZen’s
costs of suit.

(c) In the event that InnoZen decides not to initiate, or is deemed to have not decided to
initiate an infringement or other appropriate action within the 90-day period provided in Section
6.2(a), or does not initiate such an infringement or other appropriate action within 30 days of
such 90-day period as provided in Section 6.2(b), SMI shall have the right, at its expense, to
initiate an infringement or other appropriate action, and shall be entitled to join InnoZen as a
party to such suit, but InnoZen shall be under no obligation to participate except to the extent
that such participation is required as a result of its being a named party to the suit or being the
owner of any Patent Rights and/or Licensed Technology at issue. Notwithstanding the foregoing, in
the event that InnoZen is engaged at the end of said 90-day period in negotiations for the
settlement of the said patent infringement which has been the subject of notice from SMI to InnoZen
and has advised SMI in writing of such negotiations, then the above mentioned right and option of
SMI to bring suit shall be exercised only with the written consent of InnoZen which will not be
unreasonably withheld. If InnoZen chooses to participate in any suit initiated by SMI, InnoZen
shall have the right to be represented in any such suit by its own counsel at its own expense. SMI
shall not settle any such suit involving rights of InnoZen nor make an admission of liability
on behalf of InnoZen without obtaining the prior written consent of InnoZen, which consent
shall not be unreasonably withheld. In the event SMI initiates proceedings pursuant to this Section
6.2(c), SMI shall be entitled to 100% of any and all amounts recovered in such suit, whether
through judgment, settlement or otherwise, including without limitation, any punitive damages that
may be awarded, up to the amount of SMI’s costs of suit, and InnoZen and SMI shall each be entitled
to 50% of all amounts recovered in such suit, whether through judgment, settlement or otherwise,
including without limitation, any punitive damages that may be awarded, in excess of SMI’s costs of
suit.

 

- 8 -

 

(d) Nothing herein contained shall be construed to require either party to expend money in
litigation or in the enforcing of Patent Rights and/or Licensed Technology rights unless it so
elects and in the event a party proceeds with litigation in the name of the other party in any
cause in which such other party is not voluntarily a party, as evidenced by written notice, such
party shall and agrees to hold the other party harmless from any all liabilities arising
thereunder, including, but not limited to, attorney’s fees, court costs, and damages arising out of
counterclaims, cross-claims and the like.

5.3. Assistance. Each Party shall provide to the other Party reasonable assistance as
necessary for the Parties to exploit its rights under this Article V.

VI. REPRESENTATIONS AND WARRANTIES

6.1. Additional Warranties. Each Party represents and warrants to the other party that (a) it
has full right, power and authority to enter into this Agreement and to carry out the provisions
hereof, (b) it has all necessary corporate approvals for its execution, delivery and performance of
this Agreement, and (c) it has not, and will not during the term of this Agreement, grant any
rights or enter into any agreement that would conflict with the terms of this Agreement. InnoZen
represents and warrants that as a result of its prior relationship with and due diligence on
Migami, Inc., that, as of the date of execution of this Agreement, it has no intention or desire to
enter into a new transaction substantially similar to this Agreement with Migami, Inc.

VII. CONFIDENTIAL INFORMATION, SIGNAGE

7.1. Confidential Information. The Parties will receive certain Confidential Information (as
defined below) of each other, one as the “Disclosing Party” and the other as the “Receiving Party.”
The Parties are willing to provide such Confidential Information to each other only subject to the
terms set forth in this Agreement. For purposes of this Article VII, “Confidential Information”
shall mean information of any type, in any form, which a Party or its respective officers,
directors, employees, attorneys, agents, consultants, advisors, accountants, subsidiaries or
affiliates may now possess or may hereafter obtain relating to the Disclosing Party, including, but
not limited to, information relating to the Disclosing Party’s financial condition, intellectual
property, patents, patent applications, inventions, trade secrets, know-how, technology,
operations, business, business plans, business forecasts, marketing, product pricing, sales,
assets, liabilities, future prospects, customers, suppliers, manufacturing procedures, processes,
designs, equipment, personnel, research, production, formulations or products, which information
would, under the circumstances, (i) appear to a reasonable person to be confidential or
proprietary, or (ii) is designated by the Disclosing Party as being confidential or proprietary.
Except as otherwise provided in this Article VII and as contemplated by this Agreement, during the
term of this Agreement and for a period of five (5) years thereafter, such Confidential Information
shall not be disclosed, published or made accessible in any form by the Receiving Party or its
subsidiaries or Affiliates to any person, business, or entity at any time without the prior written
consent of the other Party. The restrictions on disclosure of Confidential Information set forth
above shall not apply
to any Confidential Information which the Receiving Party can demonstrate (i) was wholly and
independently developed by the Receiving Party without the use of Confidential Information of the
Disclosing Party, or (ii) is or has become generally known to the public without breach of this
confidentiality provision by the Receiving Party, or (iii) at the time of disclosure to the
Receiving Party was known to such Receiving Party free of restriction and evidenced by
documentation in such Receiving Party’s possession; or (iv) as may otherwise be required by law.

 

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7.2. Authorized Disclosure. Each Party may disclose Confidential Information received from
the other Party (a) to third parties under appropriate terms and conditions, including
confidentiality provisions substantially equivalent to this Article VII, for manufacturing or
external testing with respect to a Product and (b) to the extent such disclosure is reasonably
necessary in connection with submissions to regulatory authorities for purposes of this Agreement
or complying with applicable governmental regulations; provided, however, that in
the event of any proposed disclosure described in clause (b), the Disclosing Party will, except
where impracticable (e.g., medical emergencies) or where such disclosure is made for the purpose of
carrying out any obligation under this Agreement, give reasonable advance notice to the other Party
of such disclosure requirement and will use its reasonable efforts to secure confidential treatment
of the Confidential Information to be disclosed.

7.3. Public Announcements. Except to the extent required by applicable law or regulations or
to the extent the substance thereof has previously been reviewed and released by the Parties or is
in the public domain through no fault of the originating Party, neither Party shall make any
announcement, news release, public statement, publication or presentation regarding (i) the
material terms or performance of this Agreement, or (ii) the business relationship of the Parties
without the prior written consent of the other Party, which consent shall not be unreasonably
withheld. The Parties will consult with one another regarding the provisions of this Agreement to
be redacted in any filing made by the parties with regulatory agencies (e.g., Securities and
Exchange Commission) or as otherwise required by law. The Parties will use commercially reasonable
efforts to coordinate the initial announcement or press release relating to this Agreement such
that each Party’s initial announcement or press release may be made contemporaneously.

7.4. Signage. In consideration of the rights granted to SMI herein, SMI shall permit InnoZen
and its Affiliates to display company signage and Product brand signage and advertisement inside
and outside the offices and manufacturing facilities of SMI, provided that, all such
signage and advertisement is reasonable under the circumstances, does not interfere with SMI’s
signage or business operations, and is intended predominantly for the purpose of providing company
and brand recognition to customers and investors of InnoZen and its Affiliates that may, from time
to time, visit SMI.

VIII. TERMINATION

8.1. Termination for Breach.

(a) By SMI. SMI shall be entitled to terminate this Agreement by written notice to
InnoZen in the event that InnoZen shall be in material default of any of its obligations hereunder
and shall fail to remedy any such default within thirty (30) days after written notice thereof by
SMI.

(b) By InnoZen. InnoZen shall be entitled to terminate this Agreement by written
notice to SMI in the event that SMI shall be in material default of any of its obligations
hereunder and shall fail to remedy any such default within thirty (30) days after written notice
thereof by InnoZen.

 

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8.2. Effect of Termination. Termination of this Agreement shall not relieve either party of
its obligations incurred up to the date of termination. Except as otherwise provided in this
Agreement, upon termination, all rights in the Products, the Patent Rights and Licensed Technology
shall revert to and automatically be assigned to and owned by InnoZen. Upon termination, InnoZen
shall be the sole proprietor of all rights in the Products, the Patent Rights and the Licensed
Technology. Upon termination of this Agreement, no Party shall be relieved of any obligations,
including any liability for breach of this Agreement, incurred prior to such termination.

8.3. Survival of Obligations; Return of Confidential Information. Notwithstanding any
termination of this Agreement, the obligations of the Parties with respect to Confidential
Information (Article VIII), as well as any other provisions which by their nature are intended to
survive any such termination, shall survive and continue to be enforceable. Upon any termination of
this Agreement, each Party shall promptly return to each other Party all written Confidential
Information, and all copies thereof, of such other Party.

IX. INDEMNIFICATION

9.1. By SMI. SMI shall provide all proper safeguards and shall assume all risks in its
performance of this Agreement and shall indemnify and save InnoZen and its Affiliates, employees,
agents, representatives, directors, officers, members and shareholders harmless from and against
any and all loss, liability, damages, claims for damages, suits, recoveries, judgments or
executions, including costs, expenses and reasonable attorneys’ fees, that may be claimed asserted
or recovered against InnoZen by any person, firm or corporation whatsoever or whomsoever, on
account of any actual or alleged injury to person or property or death occurring to any person
whatsoever and arising out of: (i) any breach by SMI of any representation, warranty, covenant or
obligation under this Agreement, or (ii) the negligence, misrepresentations or misconduct of SMI,
its employees, or its Affiliates.

9.2. By InnoZen. InnoZen shall provide all proper safeguards and shall assume all risks in
its performance of this Agreement and shall indemnify and save SMI and its Affiliates, employees,
agents, representatives, directors, officers, members and shareholders harmless from and against
any and all loss, liability, damages, claims for damages, suits, recoveries, judgments or
executions, including costs, expenses and reasonable attorneys’ fees, that may be claimed asserted
or recovered against SMI by any person, firm or corporation whatsoever or whomsoever, on account of
any actual or alleged injury to person or property or death occurring to any person whatsoever and
arising out of: (i) any breach by InnoZen of any representation, warranty, covenant or obligation
under this Agreement, or (ii) the negligence, misrepresentations or misconduct of InnoZen, its
employees, or its Affiliates.

X. MISCELLANEOUS

10.1. Governing Law. This Agreement shall be governed by, and construed in accordance with
the laws of the United States of America and the State of California without regard to its rules
governing conflicts of law.

10.2. Waiver. The waiver by any Party of a breach or a default of any provision of this
Agreement by any other Party shall not be construed as a waiver of any succeeding breach of the
same or any other provision, nor shall any delay or omission on the part of a Party to
exercise or avail itself of any right, power or privilege that it has or may have hereunder operate
as a waiver of any right, power or privilege by such Party.

 

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10.3. Notices. Any notice or other communication in connection with this Agreement must be in
writing and if by mail, by certified mail, return receipt requested, and shall be effective when
delivered to the addressee at the address listed below or such other address as the addressee shall
have specified in a notice actually received by the addressor.

	 	 	 	 	 
	 

	 	If to InnoZen:
	 	InnoZen, Inc.

6429 Independence Avenue

Woodland Hills, CA 91367

Attn: Thomas Beckett

Facsimile: 818.593.4808
	 
	 	 	 	 
	 

	 	If to SMI:
	 	SMI, Inc.

2401 West 1st Street

Tempe, AZ 85281

Attn: Kevin Taheri and Rick Gean

10.4. Entire Agreement. This Agreement contains the full understanding of the Parties with
respect to the subject matter hereof and supersedes all prior understandings and writings relating
hereto. No waiver, alteration or modification of any of the provisions hereof shall be binding
unless made in writing and signed by the Parties.

10.5. Headings. The headings contained in this Agreement are for convenience of reference
only and shall not be considered in construing this Agreement.

10.6. Severability. In the event that any provision of this Agreement is held by a court of
competent jurisdiction to be unenforceable because it is invalid or in conflict with any law of any
relevant jurisdiction, the validity of the remaining provisions shall not be affected.

10.7. Assignment. Either Party shall have the right to transfer all of its rights under this
Agreement to any successor or assign of all, or substantially all, such Party’s assets or equity
interests; provided, however, that the proposed successor or assign agrees in
writing to remain bound by the terms of this Agreement. Other than as set forth above, neither
Party may assign its rights or obligations hereunder without the prior written consent of each
other Party.

10.8. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit
of the Parties hereto and their successors and permitted assigns.

10.9. Counterparts. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original but all of such together shall constitute one and the same
instrument.

 

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10.10. No Partnership. This Agreement does not constitute and shall not be construed as
constituting an agency, partnership or joint venture relationship between SMI and InnoZen. Neither
SMI nor InnoZen shall have the right to obligate or bind the other party in any manner
whatsoever, and nothing herein contained shall give or is intended to give any rights of any kind
to any third persons.

10.11. No Third-Party Beneficiaries. There are no third-party beneficiaries of this
Agreement.

10.12. Litigation Costs. In the event of any litigation arising out of or with respect to
this Agreement, the non-prevailing party shall pay the costs of the prevailing party including its
reasonable attorneys’ fees incurred in connection therewith through and including the costs of any
appeals and appellate costs relating thereto, and the reasonable attorneys’ fees and costs incurred
in connection with any bankruptcy proceeding.

10.13. Expenses in Connection with this Agreement. Each party shall bear their own costs and
expenses in connection with the negotiation, preparation, due diligence, and closing of this
Agreement.

10.14. Cooperation. Each party shall cooperate fully with the other party in carrying out the
terms of this Agreement and shall take any action or execute any document reasonably necessary to
effectuate the Agreement.

 

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IN WITNESS WHEREOF, each Party hereto has caused this Agreement to be executed in their name
by their properly and duly authorized officer or representative and this Agreement shall be
effective and create a binding obligation of such Party as of the date first above written.

	 	 	 	 	 
	 	INNOZEN:

INNOZEN, INC., a Delaware corporation

 	 
	 	By:  	/s/ Robert Davidson
 	 
	 	 	Name:  	Robert Davidson 	 
	 	 	Title:  	CEO 	 
	 
	 	SMI:

Supplemental Manufacturing & Ingredients LLC dba

SMI Manufacturing, an Arizona limited liability

company

 	 
	 	By:  	/s/ Kevin Taheri
 	 
	 	 	Name:  	Kevin Taheri 	 
	 	 	Title:  	CEO 	 

IN WITNESS WHEREOF, HealthSport, Inc., by its signature below and as of the date first above
written consents to InnoZen, Inc.’s execution of this Agreement and agrees to issue the shares of
HealthSport, Inc. common stock in accordance with the terms of Section 4.2 of this Agreement.

	 	 	 	 	 
	 	HEALTHSPORT, INC., a Delaware corporation

 	 
	 	By:  	/s/ Robert Davidson
 	 
	 	 	Name:  	Robert Davidson 	 
	 	 	Title:  	Chairman 	 
	 

 

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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}]]