VIACOM INC. Class B Common Stock Underwriting Agreement
Exhibit
1.1
Class B
Common Stock
October
14, 2009
Citigroup
Global Markets Inc.
As
Representative of the several
Underwriters
listed in Schedule 1 hereto
c/o
Citigroup Global Markets Inc.
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▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
National
Amusements, Inc., a Maryland corporation (“NAI”), proposes to cause NAIRI, Inc.,
a Delaware corporation and a wholly-owned subsidiary of NAI (the “Selling
Stockholder”), to sell to the several Underwriters listed in Schedule 1 hereto
(the “Underwriters,” which term shall include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom Citigroup Global Markets
Inc. is acting as representative (the “Representative”), and the Underwriters,
severally and not jointly, on the terms set forth herein, propose to purchase
the number of shares (the “Firm Shares”) of Class B Common Stock, $0.001 par
value (the “Class B Common Stock”) of Viacom Inc., a Delaware corporation (the
“Company”), set forth in Schedule 1 hereto under the caption “Number of Firm
Shares to be Purchased.” NAI also proposes to grant to the
Underwriters an option to purchase up to the number of additional shares of
Class B Common Stock set forth on Schedule 1 hereto under the caption “Maximum
Number of Option Shares to be Purchased” to cover over-allotments, if any (the
“Option Shares” and collectively with the Firm Shares, if any, the
“Shares”).
1. Representations and
Warranties.
(i) Representations and
Warranties of the Company. The Company represents and warrants
to the Underwriters, as of the date hereof, as follows:
(a) Registration
Statement and the Prospectus. The Company has filed with the
Securities and Exchange Commission (the “Commission”) an automatic shelf
registration statement, as defined in Rule 405, on Form S-3 (No. 333-139086)
under the Securities Act of 1933, as amended (the “1933 Act”) (including the
information (if any)
deemed to
be part of the registration statement at the time of effectiveness pursuant to
Rule 430A, Rule 430B or Rule 430C under the 1933 Act, the “Registration
Statement”) in respect of, among other things, the Class B Common Stock, and the
Registration Statement became effective upon filing. The Company
meets the requirements for use of Form S-3 under the ▇▇▇▇ ▇▇▇. If the
Company files a registration statement with the Commission pursuant to Rule
462(b) of the rules and regulations under the 1933 Act, then all references to
the Registration Statement shall also be deemed to include that Rule 462(b)
registration statement. The prospectus included in the Registration
Statement on December 1, 2006 is hereinafter referred to as the “Base
Prospectus.” The Base Prospectus, as supplemented by the final
prospectus supplement dated October 14, 2009 specifically relating to the Shares
in the form filed with the Commission pursuant to Rule 424(b) is hereinafter
referred to as the “Prospectus,” and the term “Preliminary Prospectus” means the
preliminary form of the Prospectus dated October 14, 2009. For
purposes of this Agreement, “free writing prospectus” has the meaning set forth
in Rule 405 under the 1933 Act, and “Time of Sale Information” means the
Preliminary Prospectus as supplemented by the free writing prospectuses, if any,
each identified in Schedule 3 hereto, the information included in Schedule
2 hereto and the other written communications, if any, referred to in Section
1(i)(b). As used herein, the terms “Registration Statement,” “Base
Prospectus,” “Preliminary Prospectus,” “Time of Sale Information” and
“Prospectus” shall include the documents, if any, incorporated by reference
therein. Any reference herein to the terms “amend,” “amendment” or
“supplement” with respect to the Registration Statement, the Base Prospectus,
the Preliminary Prospectus, the Time of Sale Information and the Prospectus
shall be deemed to refer to and include the filing of any document under the
Securities Exchange Act of 1934, as amended (the “1934 Act”), after the date of
this Underwriting Agreement, or the issue date of the Base Prospectus, the
Preliminary Prospectus, the Time of Sale Information or the Prospectus, as the
case may be, deemed to be incorporated therein by reference.
The
Registration Statement, at the time and date the Registration Statement
initially became effective, complied in all material respects with the
applicable provisions of the 1933 Act and the applicable rules and regulations
of the Commission thereunder. The Registration Statement, at the time
and date it initially became effective, did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. The Time of
Sale Information, on October 14, 2009, did not contain 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. The Prospectus, on the date it is filed with,
or transmitted for filing to, the Commission pursuant to Rule 424, at the
Closing Time and at any Settlement Time, will comply, in all material respects,
with the applicable provisions of the 1933 Act and will not contain an 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; provided, however, that the
Company makes no representations or warranties as to (i) that part of the
Registration Statement which shall constitute the Statement of Eligibility and
Qualification (Form T-1) of the Trustee under the Trust Indenture Act of 1939,
as amended (the “1939 Act”) or (ii) the information contained
in
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or
omitted from the Registration Statement, the Preliminary Prospectus, the Time of
Sale Information or the Prospectus or any amendment thereof or supplement
thereto in reliance upon and in conformity with information furnished to the
Company in writing by NAI or the Selling Stockholder or by or on behalf of any
Underwriter through the Representative specifically for use in the Registration
Statement, the Preliminary Prospectus, the Time of Sale Information or the
Prospectus or any amendment thereof or supplement thereto, it being understood
and agreed that the only such information furnished by or on behalf of any
Underwriter consists of the information described as such in Section 6(b)
hereof.
(b) Issuer Free
Writing Prospectus. The Company
(including its agents and representatives, other than the Underwriters in their
capacity as such) has not made, used, prepared, authorized, approved or referred
to and will not prepare, make, use, authorize, approve or refer to any free
writing prospectus other than the documents listed on Schedule 3 hereto, if any,
and other written communications, a copy of which has been furnished to the
Representative and to which the Representative has not reasonably
objected. Any such free writing prospectus and any such other written
communications as of its issue date complied in all material respects with the
requirements of the 1933 Act and the rules and regulations thereunder and was
filed with the Commission in accordance with the 1933 Act (to the extent
required pursuant to Rule 433(d) thereunder).
(c) Incorporated
Documents. The documents
incorporated in the Registration Statement, the Time of Sale Information and the
Prospectus, at the time they were (or hereafter, until the Closing Time, are)
filed with the Commission, complied and will comply, as the case may be, in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the “1934 Act
Regulations”).
(d) Independent
Accountants. The accountants
who certified the financial statements and any supporting schedules thereto
included in the Registration Statement, the Time of Sale Information and the
Prospectus are independent public accountants with respect to the Company as
required by the 1933 Act and the applicable rules and regulations of the
Commission thereunder (the “1933 Act Regulations”) and the Public Company
Accounting Oversight Board.
(e) Financial
Statements. The financial
statements of the Company included in the Registration Statement, the Time of
Sale Information and the Prospectus, together with the related schedules and
notes, as well as those financial statements, schedules and notes of any other
entity included therein, present fairly the financial position of the Company in
all material respects at the dates indicated, and the statement of operations,
stockholders’ equity and cash flows of the Company for the periods
specified. Such financial statements have been prepared in conformity
with generally accepted accounting principles (“GAAP”) applied on a consistent
basis throughout the periods involved. The supporting schedules, if
any, included in the Registration Statement, the Time of Sale Information and
the Prospectus present fairly, in all material respects, in accordance with GAAP
the information required to be stated therein. The summary financial
data for the Company, the capitalization table and the ratio of earnings to
fixed
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charges
included in the Registration Statement, the Time of Sale Information and the
Prospectus present fairly, in all material aspects, the information shown
therein and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement, the Time of Sale
Information and the Prospectus.
(f) No
Material Adverse Change in Business. Since the respective
dates as of which information is given in the Time of Sale Information, except
as otherwise stated therein, (A) there has been no material adverse change in
the financial condition, results of operations or business affairs of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business (a “Material Adverse Effect”), and
(B) there have been no material transactions entered into by the Company other
than transactions contemplated by the Time of Sale Information or transactions
arising in the ordinary course of business.
(g) Good
Standing. The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Time of Sale
Information and the Prospectus and to enter into and perform its obligations
under, or as contemplated under, this Underwriting Agreement. The
Company is duly qualified as a foreign corporation to transact business and is
in good standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failures to so qualify or be in good
standing would not in the aggregate result in a Material Adverse
Effect.
(h) Good
Standing of Designated Subsidiaries. Each
“significant subsidiary” of the Company (as such term is defined in Rule 1-02 of
Regulation S-X promulgated under the 1933 Act), if any, has been duly organized
and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Time of Sale Information and the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failures to so
qualify or be in good standing would not in the aggregate result in a Material
Adverse Effect.
(i) Authorization
of Agreement. This Underwriting Agreement has been duly
authorized, executed and delivered by the Company.
(j) Authorization
of the Shares. The Shares have been duly authorized and are
validly issued, fully paid and non-assessable.
(k) Capital
Stock of the Company. The Company has an authorized
capitalization as set forth in each of the most recent Preliminary Prospectus
and the Prospectus under the heading “Capitalization;” all the outstanding
shares of capital stock of the Company (including the Shares to be sold by the
Selling Stockholder) have been duly and validly authorized and issued and are
fully paid and non-assessable and are not subject
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to any
pre-emptive or similar rights; except (i) for shares of capital stock issuable
upon the exercise of outstanding stock options or other equity awards of the
Company and (ii) as described in or expressly contemplated by the
Time of Sale Information and the Prospectus, there are no outstanding rights
(including, without limitation, pre-emptive rights), warrants or options to
acquire to which the Company or any of its subsidiaries is a party, or
instruments convertible into or exchangeable for, any shares of capital stock or
other equity interest in the Company or any of its subsidiaries, or any
contract, commitment, agreement, understanding or arrangement of any kind
relating to the issuance of any capital stock of the Company or any such
subsidiary, any such convertible or exchangeable securities or any such rights,
warrants or options; and the capital stock of the Company conforms in all
material respects to the description thereof contained in the Registration
Statement, the Time of Sale Information and the Prospectus.
(l) Absence
of Defaults and Conflicts. The compliance by the Company with
all of the provisions of this Underwriting Agreement and the consummation of the
transactions contemplated herein do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or constitute a
breach of, or default or Repayment Event (as defined below) under, any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease or
other agreement or instrument to which the Company or any of its subsidiaries is
a party or by which it or any of them may be bound, or to which any of the
assets, properties or operations of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the provisions of the
charter or by-laws of the Company or any of its subsidiaries or any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its subsidiaries or any of their assets,
properties or operations, except, in any such case, for such conflicts, breaches
or violations as would not individually or in the aggregate result in a Material
Adverse Effect or have a material adverse effect on the transactions
contemplated by this Underwriting Agreement. As used herein, a
“Repayment Event” means any event or condition which gives the holder of any
note, debenture or other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any of its
subsidiaries.
(m) Absence
of Proceedings. There is no action, suit, proceeding, inquiry
or investigation before or brought by any court or governmental agency or body,
domestic or foreign, now pending, or to the knowledge of the Company threatened,
against or affecting the Company or any of its subsidiaries which is required to
be disclosed in the Time of Sale Information and the Prospectus (other than as
stated therein), or which individually or in the aggregate would result in a
Material Adverse Effect, or which would materially and adversely affect the
consummation of the transactions contemplated under the Time of Sale Information
and the Prospectus or the performance by the Company of its obligations
hereunder and thereunder.
(n) Absence
of Further Requirements. No filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or
5
governmental
authority or agency, domestic or foreign, is necessary or required for due
authorization, execution and delivery by the Company of this Underwriting
Agreement or for the performance by the Company of the transactions contemplated
under this Underwriting Agreement, except as otherwise set forth herein, and
except such as have been already made, obtained or rendered, as applicable, and
as may be required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Shares by the Underwriters and except where
the failure to obtain any such filing, authorization, approval, consent,
license, order, registration, qualification or decree would not individually or
in the aggregate result in a Material Adverse Effect.
(o) Absence
of Market Stabilization or Manipulation. The Company has
not taken, directly or indirectly, any action designed to or that would
constitute or that might be reasonably expected to cause or result in, under the
1934 Act or otherwise, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares.
(p) Officer’s
Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Representative or to counsel
for the Underwriters shall be deemed a representation and warranty by the
Company or such subsidiary, as the case may be, to each Underwriter as to
matters covered thereby.
(q) Disclosure
Controls. The Company and its subsidiaries maintain an
effective system of “disclosure controls and procedures” (as defined in Rule
13a-15(e) of the ▇▇▇▇ ▇▇▇) that is designed to ensure that information required
to be disclosed by the Company in reports that it files or submits under the
1934 Act is recorded, processed, summarized and reported within the time periods
specified in the Commission’s rules and forms, including controls and procedures
designed to ensure that such information is accumulated and communicated to the
Company’s management as appropriate to allow timely decisions regarding required
disclosure. The Company and its subsidiaries have carried out
evaluations of the effectiveness of its disclosure controls and procedures as
required by Rule 13a-15 of the 1934 Act.
(r) Accounting
Controls. The Company and
its subsidiaries maintain systems of “internal control over financial reporting”
(as defined in Rule 13a-15(f) of the ▇▇▇▇ ▇▇▇) that comply with the requirements
of the 1934 Act to the extent applicable thereto. Except as disclosed
in the Time of Sale Information and the Prospectus, to the Company’s knowledge
there are no material weaknesses in the Company’s internal
controls.
(s) ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act. There is, and has been, no material failure on the part
of the Company or the Company’s subsidiaries, or any of their directors or
officers, in their capacities as such, to comply with any applicable provision
of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations promulgated in
connection therewith (the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”), including without limitation
Section 402 related to loans and Sections 302 and 906 related to certifications
by the Company’s Chief Executive Officer and Chief Financial
Officer.
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(ii) Representations and
Warranties of NAI. NAI represents and warrants to the
Underwriters, as of the date hereof, as follows:
(a) Ownership
of the Shares. The Selling
Stockholder is the beneficial owner of 46,829,414 shares of the Class A Common
Stock of the Company, $0.001 par value per share (the “Class A Common Stock”),
and 16,298,208 shares of the Class B Common Stock, and at the Closing Time and
at any Settlement Time will be the beneficial owner of the Shares (including
those Shares that are issuable upon conversion of the Class A Common Stock) to
be sold by it hereunder free and clear of all liens, encumbrances, equities and
claims, and has full power and authority to sell its interest in the Shares,
and, assuming that each Underwriter acquires its interest in the Shares it has
purchased from the Selling Stockholder without notice of any adverse claim
(within the meaning of Section 8-105 of the New York Uniform Commercial Code
(“UCC”), each Underwriter that has purchased such Shares delivered at the
Closing Time and at any Settlement Time to The Depository Trust Company or other
securities intermediary by making payment therefor as provided herein, and that
has had such Shares credited to the securities account or accounts of such
Underwriter maintained with The Depository Trust Company or such other
securities intermediary, will have acquired a security entitlement (within the
meaning of Section 8-102(a)(17) of the UCC) to such Shares purchased by such
Underwriter, and no action based on an adverse claim (within the meaning of
Section 8-105 of the UCC) may be asserted against such Underwriter with respect
to such Shares.
(b) Authorization
of Agreement. This Underwriting Agreement has been duly
authorized, executed and delivered by NAI.
(c) Absence
of Market Stabilization or Manipulation. Neither NAI nor
the Selling Stockholder has taken, directly or indirectly, any action designed
to or that would constitute or that might be reasonably expected to cause or
result in, under the 1934 Act or otherwise, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares.
(d) Absence
of Defaults and Conflicts. The execution, delivery and
performance of this Agreement by NAI and the sale of the Shares being sold by
the Selling Stockholder do not and will not, whether with or without the giving
of notice or passage of time or both, conflict with or constitute a breach of,
or default or Repayment Event under, any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which the
Selling Stockholder, NAI or any of their respective subsidiaries is a party or
by which the Selling Stockholder, NAI or any of their respective subsidiaries
may be bound, or to which any of the assets, properties or operations of the
Selling Stockholder, NAI or any of their respective subsidiaries is subject, nor
will such action result in any violation of the provisions of the charter or
by-laws of the Selling Stockholder, NAI or any of their respective subsidiaries
or any applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Selling Stockholder, NAI or any of their
respective subsidiaries or any of their assets, properties or operations,
except, in any such case, for such conflicts, breaches or violations as
would
7
not
individually or in the aggregate result in a Material Adverse Effect or have a
material adverse effect on the transactions contemplated by this Underwriting
Agreement.
(e) Absence
of Further Requirements. No filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency, domestic or foreign, is necessary or
required for due authorization, execution and delivery by NAI of this
Underwriting Agreement or for the performance by the Selling Stockholder or NAI,
as the case may be, of the transactions contemplated under this Underwriting
Agreement, except as otherwise set forth herein, and except such as have been
already made, obtained or rendered, as applicable, and as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters.
(f) Registration
Statement and the Prospectus. The sale of the Shares by the Selling
Stockholder pursuant hereto is not prompted by any information concerning the
Company or any of its subsidiaries which is not set forth in the Time of Sale
Information and the Prospectus or any amendment or supplement
thereto.
The Time
of Sale Information and the Prospectus do not contain and, as amended or
supplemented, if applicable, will not contain, at the Closing Time, any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this paragraph are limited to statements or omissions based upon information
relating to the Selling Stockholder or NAI furnished to the Company in writing
by NAI or the Selling Stockholder expressly for use in the Time of Sale
Information and the Prospectus or any amendments or supplements
thereto.
(g) Officer’s
Certificates. Any certificate signed by any officer of NAI
delivered to the Representative or to counsel for the Underwriters shall be
deemed a representation and warranty by NAI to each Underwriter as to matters
covered thereby.
(h) Wholly-Owned
Subsidiary. NAI is the record and beneficial owner of 100% of
the outstanding capital stock of the Selling Stockholder free and clear of all
liens, encumbrances, equities and claims, except to the extent of the pledge of
such stock pursuant to NAI’s existing debt instruments, and has the right and
ability to cause the Selling Stockholder to sell the Shares and to perform all
other acts contemplated to be performed by it hereunder, except to the extent of
the pledge of the Shares pursuant to NAI’s existing debt
instruments.
2. Sale and Delivery to
Underwriters; Closing.
(a) Shares. (i) Subject to
the terms and conditions set forth herein, NAI agrees to cause the Selling
Stockholder to sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Selling Stockholder, at
a purchase price of $27.1906 per share, the number of Firm Shares set forth in
Schedule 1 hereto opposite the name
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of such
Underwriter plus any additional Firm Shares which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10
hereof.
(ii) Subject
to the terms and conditions set forth herein, NAI hereby grants an option to the
several Underwriters to purchase, severally and not jointly, and to cause the
Selling Stockholder to sell, up to the number of Option Shares set forth in
Schedule 1 hereto at the same purchase price per share as the Underwriters shall
pay for the Firm Shares. Said option may be exercised only to cover
over-allotments in the sale of the Firm Shares by the
Underwriters. Said option may be exercised in whole or in part at any
time on or before the 30th day after the date of the Prospectus upon written or
telegraphic notice by the Representatives to the Company and the Selling
Stockholder setting forth the number of Option Shares as to which the
several Underwriters are exercising, the option and any Settlement
Time. The number of Option Shares to be purchased by each Underwriter
shall be the same percentage of the total number of Option Shares to be
purchased by the several Underwriters as such Underwriter is purchasing of the
Firm Shares, subject to such adjustments as you in your absolute discretion
shall make to eliminate any fractional shares.
(b) Payment. Payment of the
purchase price for, and delivery of, the Firm Shares shall be made at the
offices of Shearman & Sterling LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, or at such other place as shall be agreed upon by the Representative and
the Company, at 10:00 A.M. (Eastern time) on October 20, 2009 (unless postponed
in accordance with the provisions of Section 10), or such other time not later
than ten business days after such date as shall be agreed upon by the
Representative, the Company and NAI (such time and date of payment and delivery
being herein called the “Closing Time”).
If the
option provided for in Section 2(a)(ii) hereof shall have been exercised on or
before the third Business Day immediately preceding the Closing Time, payment of
the purchase price for, and delivery of, the Option Shares shall be made at the
offices of Shearman & Sterling LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, or at such other place as shall be agreed upon by the Representative, the
Company and NAI, at the Closing Time.
If the
option provided for in Section 2(a)(ii) hereof is exercised after the third
Business Day immediately preceding the Closing Time, payment of the purchase
price for, and delivery of, the Option Shares shall be made at the offices of
Shearman & Sterling LLP, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or
at such other place as shall be agreed upon by the Representative, the Company
and NAI, at 10:00 A.M. (Eastern time) on the date specified by the
Representative (which shall be within three Business Days after exercise of said
option).
The time
and date of payment of the purchase price for, and delivery of, the Option
Shares is herein called the “Settlement Time.”
Payment
shall be made to NAI by wire transfer of immediately available funds to a bank
account designated by NAI (which, for the avoidance of doubt, may be an account
of the Selling Stockholder), against delivery to the Representative for the
respective accounts of the Underwriters of the Shares to be purchased by
them. It is understood that each Underwriter has authorized the
Representative, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Shares which it has severally agreed to
purchase. The
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Representative,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Shares to be
purchased by any Underwriter whose funds have not been received by
the Closing Time, but such payment shall not relieve such Underwriter
from its obligations hereunder. Delivery of the Shares shall be made
through the facilities of the Depository Trust Company (“DTC”) unless the
Representative shall otherwise instruct.
NAI will
pay all applicable state transfer taxes, if any, involved in the transfer to the
several Underwriters of the Shares to be purchased by them from the Selling
Stockholder and the respective Underwriters will pay any additional stock
transfer taxes involved in further transfers of such Shares by
them.
(c) Certain
Restrictions. Each Underwriter agrees that it will not offer,
sell or deliver any of the Shares, directly or indirectly, or distribute the
Time of Sale Information or the Prospectus or any other offering material
relating to the Shares, in or from any jurisdiction except under circumstances
that will result in compliance with the applicable laws and regulations thereof
and which will not impose any obligations on the Company or the Selling
Stockholder except as set forth in this Underwriting Agreement.
(d) Free
Writing
Prospectuses. Each Underwriter represents and agrees that,
without the prior consent of the Company, it has not made and will not make any
offer relating to the Shares that would constitute a free writing
prospectus. Notwithstanding anything to the contrary herein, the
Company and NAI consent to the use by any Underwriter of a free writing
prospectus that contains only information that is not “issuer information,” as
defined in Rule 433 under the 1933 Act.
3. Covenants.
(i)
Covenants of the
Company. The Company covenants with each Underwriter, as
follows:
(a) Compliance
with Securities Regulations and Commission Requests. The Company,
subject to Section 3(i)(b), will comply with the requirements of Rule 430A, 430B
or 430C of the 1933 Act Regulations and Rule 462(b) of the 1933 Act Regulations,
if and as applicable, will file any free writing prospectus to the extent
required by Rule 433 under the 1933 Act, and will notify the Representative
immediately, and confirm the notice in writing, of (i) the effectiveness of any
post-effective amendment to the Registration Statement or the filing of any
supplement or amendment to the Prospectus, (ii) the receipt of any comments from
the Commission with respect to the Registration Statement, the Prospectus or the
Time of Sale Information, (iii) any request by the Commission for any amendment
to the Registration Statement or any amendment or supplement to the Prospectus
or for additional information, and (iv) the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or of any
order preventing or suspending the use of the Prospectus, or of the suspension
of the qualification of the Shares for offering or sale in any jurisdiction, or
of the initiation or threatening of any proceedings for any of such
purposes. The Company will promptly effect the filings necessary
pursuant to Rule 424 and will take such steps as it
10
deems
necessary to ascertain promptly whether the Prospectus transmitted for filing
under Rule 424 was received for filing by the Commission and, in the event that
it was not, it will promptly file the Prospectus. The Company will
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) Filing
of Amendments. Prior to the Closing Time, the Company will
advise the Representative promptly of its intention to file or prepare any
amendment to the Registration Statement, any amendment, supplement or revision
to the Prospectus, or any free writing prospectus in relation to the Shares,
will furnish the Representative with copies of any such documents or
communications a reasonable amount of time prior to such proposed filing or use,
as the case may be, and will not file or use any such document to which the
Representative or counsel for the Underwriters shall reasonably object on a
timely basis, unless, in the judgment of the Company or its counsel, such
amendment or supplement or other document or communication is necessary to
comply with any law.
(c) Delivery
of Registration Statements. The Company has
furnished or, if requested in writing by the Representative, will deliver to the
Representative and counsel for the Underwriters, without charge, signed copies
of the Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein) and
signed copies of all consents and certificates of experts, and will also deliver
to the Representative, at no expense to the Underwriters or the Company, one
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters.
(d) Delivery
of Prospectuses. The Company will
furnish to each Underwriter, at no expense to the Underwriters or the Company,
during the period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act (or required to be delivered but for Rule 172 under the 1933
Act), such number of copies of the Prospectus and each free writing prospectus
as such Underwriter may reasonably request.
If, at
any time prior to the filing of the Prospectus pursuant to Rule 424(b), any
event occurs as a result of which the Time of Sale Information would include any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under which
they were made at such time not misleading, the Company will (i) notify promptly
the Representative so that any use of the Time of Sale Information may cease
until it is amended or supplemented; (ii) amend or supplement the Time of Sale
Information to correct such statement or omission; and (iii) supply any
amendment or supplement to you in such quantities as you may reasonably
request.
(e) Continued
Compliance with Securities Laws. The Company will
comply in all material respects with the 1933 Act and the 1933 Act Regulations
and the 1934 Act and the 1934 Act Regulations so as to permit the completion of
the distribution of the Shares as contemplated in this Underwriting Agreement
and in the Time of Sale
11
Information
and the Prospectus. If at any time when the Prospectus is required by
the 1933 Act or the 1934 Act to be delivered (or required to be delivered but
for Rule 172 under the ▇▇▇▇ ▇▇▇) in connection with sales of the Shares, any
event shall occur or condition shall exist as a result of which it is necessary
in the opinion of counsel for the Company, after consultation with counsel for
the Underwriters, to amend the Registration Statement in order that the
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or to amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of counsel for the Company, at any such time to amend the Registration
Statement or amend or supplement the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the Company will
promptly (i) notify the Representatives of such fact and (ii) prepare and file
with the Commission, subject to Section 3(i)(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement, the Time of Sale Information or the Prospectus comply
with such requirements, and the Company will furnish to the Underwriters, at no
expense to the Underwriters or the Company, such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(f) Blue Sky
Qualifications. The Company will
use its best efforts, in cooperation with the Underwriters, to qualify the
Shares for offering and sale under the applicable securities laws of such states
and other jurisdictions (domestic or foreign) as the Representative may
designate and to maintain such qualifications in effect for so long as required
for the distribution of the Shares; provided, however, that the
Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject.
(g) Listing. The Company shall use its
best efforts to have the Shares listed and admitted and authorized for trading
on the New York Stock Exchange.
(h) Lock-Up. The
Company will not, during the period commencing on the date hereof and ending 30
days after the date of the Prospectus, without the prior written consent of the
Representative, offer, sell, contract to sell, announce the intention to sell,
pledge, or otherwise dispose of (or enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement or
otherwise) by the Company or any affiliate of the Company (other than the
Selling Stockholder or a controlling person of the Selling Stockholder) or any
person in privity with the Company or any affiliate of the Company (other than
the Selling Stockholder or a controlling person of the Selling Stockholder)),
directly or indirectly, including the filing (or participation in the filing) of
a registration statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call equivalent
position within the meaning
12
of
Section 16 of the Exchange Act, any other shares of Class B Common Stock or
any securities convertible into, or exercisable, or exchangeable for, shares of
Class B Common Stock; or publicly announce an intention to effect any such
transaction. The foregoing sentence shall not apply to (i) the Shares
to be sold hereunder; (ii) the issuance by the Company of shares of Class B
Common Stock issuable upon the conversion of securities (including Class A
Common Stock, $0.001 par value, of the Company) or the exercise of warrants
outstanding as of the date hereof; (iii) the issuance by the Company of Class B
Common Stock, options or other securities pursuant to any employee stock option
plan, stock ownership plan or dividend reinvestment plan or any other plan of
the Company in effect as of the date hereof; (iv) the filing of a registration
statement on Form S-8 with respect to any employee stock option plan, stock
ownership plan, dividend reinvestment plan or any other plan described in clause
(iii) above; and (v) the entering into an acquisition agreement, or the public
announcement of such agreement, that would provide for the issuance of Class B
Common Stock by the Company, provided that any such issuance may not occur
during the 30-day period described in the foregoing sentence.
(i) Earnings
Statement. The Company will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to its
securityholders an earnings statement for the purposes of, and to provide the
benefits contemplated by, the last paragraph of Section 11(a) of the 1933
Act. The Company may elect to rely upon Rule 158 under the 1933 Act
and may elect to make such earnings statement available more frequently than
once in any period of twelve months.
(j) DTC. The
Company will cooperate with the Representative and use its reasonable best
efforts to permit the Shares to be eligible for clearance and settlement through
the facilities of DTC.
(k) Absence
of Market Stabilization or Manipulation. The Company will
not take, directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or result in, under the
1934 Act or otherwise, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares.
(l) Reporting
Requirements. Until the
Closing Time, the Company will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by the 1934
Act and the 1934 Act Regulations.
(m) Record
Retention. The Company will, to the extent required under Rule
433 under the 1933 Act, retain copies of each free writing prospectus that it
has used and not filed with the Commission.
(ii) Covenants of
NAI. NAI covenants with each Underwriter, as
follows:
(a) Lock-up
Agreement. Except for the
Shares to be sold hereunder, during the period commencing on the date hereof and
ending 90 days after the date of the Prospectus without the prior written
consent of the Representative, NAI will not cause or
13
permit
the Selling Stockholder to offer, sell, contract to sell, announce the intention
to sell, pledge, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to cash
settlement or otherwise) by the Selling Stockholder or any of its
affiliates (other than the Company) or any person in privity with the Selling
Stockholder or any of its affiliates (other than the Company)), directly or
indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call equivalent
position within the meaning of Section 16 of the 1934 Act, any other shares
of Class B Common Stock or any securities convertible into, or exercisable, or
exchangeable for, shares of Class B Common Stock; or publicly announce an
intention to effect any such transaction; provided, however, that the
Selling Stockholder’s shares of Class A Common Stock and Class B Common Stock
are subject to remedies available to its debt holders upon default under and
pursuant to the Selling Stockholder’s debt instruments as of the date
hereof.
Notwithstanding
the foregoing, if (x) during the last 17 days of such restricted period the
Company issues an earnings release or material news or a material event relating
to the Company occurs, or (y) prior to the expiration of the restricted period,
the Company announces that it will release earnings results during the 16-day
period beginning on the last day of the restricted period, the restrictions
imposed in this clause shall continue to apply until the expiration of the
18-day period beginning on the issuance of the earnings release or the
occurrence of the material news or material event.
(b) Absence
of Market Stabilization or Manipulation. NAI will not,
and NAI will not permit the Selling Stockholder to, take, directly or
indirectly, any action designed to or that would constitute or that might
reasonably be expected to cause or result in, under the 1934 Act or otherwise,
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares.
(c) Free
Writing Prospectus. NAI represents
that it has not prepared or had prepared on its behalf or used or referred to,
and agrees that it will not prepare or have prepared on its behalf or use or
refer to, any free writing prospectus, and has not distributed and will not
distribute any written materials in connection with the offer or sale of the
Shares.
(d) Release
of Pledges. NAI shall cause the Selling Stockholder to cause
the Shares to be released from any and all pledges and other liens,
encumbrances, equities and claims under NAI’s existing debt instruments in
accordance with the respective terms thereof such that the Shares may be
delivered at the Closing Time and at any Settlement Time, as the case may be, in
accordance with the terms hereof.
4. Payment of
Expenses. NAI will pay all expenses incident to the
performance of its and the Company’s obligations under this Underwriting
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and any schedules or
exhibits and any document incorporated therein by reference) as originally filed
and of each amendment or supplement thereto, (ii) the preparation, printing and
delivery to
14
the
Underwriters of this Underwriting Agreement, any agreement among Underwriters
and such other documents as may be required in connection with the offering,
purchase, sale, issuance or delivery of the Shares, (iii) the preparation,
issuance and delivery of the Shares and any certificates for the Shares to the
Underwriters, including any transfer taxes and any stamp or other duties payable
upon the sale or delivery of the Shares to the Underwriters and any charges of
DTC in connection therewith, (iv) the reasonable documented fees and
disbursements of the Company’s counsel, accountants and other agents (including
transfer agents and registrars), (v) the qualification of the Shares under state
securities laws in accordance with the provisions of Section 3(i)(f) hereof,
including filing fees and the reasonable documented fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation, printing and delivery of the Blue Sky Survey, and any amendment
thereto, (vi) the printing and delivery to the Underwriters of copies of the
Prospectus and any amendments or supplements thereto, (vii) the listing of the
Shares on the New York Stock Exchange, (viii) the filing fees incident to, and
the reasonable documented fees and disbursements of counsel to the Underwriters
in connection with, the review, if any, by the Financial Industry Regulatory
Authority (“FINRA”) of the terms of the sale of the Shares and (x) the filing
fees payable to the Commission in connection with the registration therewith of
the Shares.
5. Conditions of Underwriters’
Obligations. The obligations of the several Underwriters to
purchase and pay for any Shares under this Underwriting Agreement are subject to
the accuracy of the representations and warranties of the Company and NAI
contained in Section 1 hereof or in certificates of any officer of the Company
or any of its subsidiaries or of any officer of NAI delivered pursuant to the
provisions hereof, to the performance by the Company and NAI of their respective
covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness
of Registration Statement. No stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act and no proceedings for that purpose, pursuant to Rule
401(g)(2) or pursuant to Section 8A under the 1933 Act, shall have been
instituted or be pending or, to the knowledge of the Company, threatened, by the
Commission. A prospectus containing information relating to the
description of the Shares, the specific method of distribution and similar
matters shall have been filed with the Commission in accordance with Rule 424
under the 1933 Act Regulations.
(b) Opinion
of Counsel for Company. At the Closing Time and at any
Settlement Time, the Representative shall have received the favorable opinion,
dated as of the date of the Closing Time and any Settlement Time, respectively,
of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Company, in
form and substance satisfactory to counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters,
with respect to such matters as the Underwriters may reasonably
request.
(c) Opinion
of Counsel for NAI and the Selling Stockholder. At the Closing
Time and at any Settlement Time, the Representative shall have received the
favorable opinion, dated as of the date of the Closing Time and any Settlement
Time, respectively, of Shearman & Sterling LLP, counsel for NAI and the
Selling Stockholder, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters, with respect to such matters as the Underwriters may
reasonably request.
15
(d) Opinion
of In-House Counsel for NAI. At the Closing Time and at any
Settlement Time, the Representatives shall have received the favorable opinion,
dated as of the date of the Closing Time and any Settlement Time, respectively,
of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, the Vice President and General Counsel of NAI, in form
and substance satisfactory to counsel for the Underwriters, together with signed
or reproduced copies of such letter for each of the other Underwriters, with
respect to such matters as the Underwriters may reasonably request.
(e) Opinion
of Counsel for Underwriters. At the Closing
Time and at any Settlement Time, the Representative shall have received the
favorable opinion, dated as of the date of the Closing Time and any Settlement
Time, respectively, of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the
Underwriters, together with signed or reproduced copies of such letter for each
of the other Underwriters, with respect to such matters as the Underwriters may
reasonably request.
(f) Officers’
Certificate from the Company. At the Closing
Time and at any Settlement Time, the Representative shall have received a
certificate of the Executive Vice President, or a Senior Vice President or a
Vice President of the Company and of the chief financial officer or chief
accounting officer of the Company, dated as of the date of the Closing Time and
any Settlement Time, respectively, to the effect that (x) the representations
and warranties in Section 1(i) are true and correct with the same force and
effect as though expressly made at and as of the Closing Time, (y) the Company
has complied with all agreements and satisfied all conditions on its part to be
performed or satisfied in this Agreement at or prior to the Closing Time, and
(z) no stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been instituted, are
pending or, to the best of such officer’s knowledge, are threatened by the
Commission.
(g) Officers’
Certificate from NAI. At the Closing
Time and at any Settlement Time, the Representative shall have received a
certificate of the Executive Vice President, or a Senior Vice President or a
Vice President of the NAI and of the chief financial officer or chief accounting
officer of NAI, dated as of the date of the Closing Time and any Settlement
Time, respectively, to the effect that (x) the representations and warranties in
Section 1(ii) are true and correct with the same force and effect as though
expressly made at and as of the Closing Time and any Settlement Time,
respectively, and (y) NAI has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied in this Agreement at or
prior to the Closing Time or any Settlement Time, respectively.
(h) Accountant’s
Comfort Letter. At the time of
the execution of this Underwriting Agreement, the Representative shall have
received from PricewaterhouseCoopers LLP a letter dated such date, in form and
substance satisfactory to the Representative, together with signed or reproduced
copies of such letter for each of the other Underwriters, containing statements
and information of the type ordinarily included in accountants’ “comfort
letters” to underwriters with respect to the financial statements and certain
financial information contained or incorporated by reference in the Time of Sale
Information and the Prospectus.
(i) Bring-down
Comfort Letter. At the Closing
Time, the Representative shall have received from PricewaterhouseCoopers LLP a
letter, dated as of the date of the Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection
(e)
16
of this
Section 5, except that the specified date referred to shall be a date not more
than three business days prior to the Closing Time.
(j) Ratings. On the date
hereof and prior to the Closing Time and any Settlement Time, there shall not
have occurred any downgrading in the rating of any debt securities of the
Company by Standard & Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc., ▇▇▇▇▇’▇ Investors Service, Inc. or Fitch Ratings Ltd. or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Company (other than an announcement
with positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating).
(k) Listing. The Shares shall have been
listed and admitted and authorized for trading on the New York Stock Exchange,
subject to official notice of issuance, and satisfactory evidence of such
actions shall have been provided to the Representative.
(l) [Reserved].
(m) Additional
Documents. At the Closing
Time and at any Settlement Time, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may reasonably require for
the purpose of enabling them to pass upon the sale of the Shares as herein
contemplated, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Company and NAI in connection with the sale of
the Shares as herein contemplated shall be reasonably satisfactory in form and
substance to the Representative and counsel for the Underwriters.
6. Indemnification.
(a) Indemnification
of Underwriters. The Company and
NAI severally, and not jointly, agree to indemnify and hold harmless each
Underwriter, each director, officer and affiliate of each Underwriter, and each
person, if any, who controls any 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 the Registration Statement (or any amendment thereto) 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
included in the Time of Sale Information, the Prospectus (or any amendment or
supplement thereto), any free writing prospectus that the Company has filed, or
is required to file, pursuant to Rule 433(d) under the 1933 Act, 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
17
threatened,
or any claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided that (subject to
Section 6(d) below) any such settlement is effected with the written consent of
the Company; and
(iii) against
any and all expense as reasonably incurred (including the fees and disbursements
of counsel chosen by the Representative), 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 (i)
or (ii) above;
provided, however, that (x)
notwithstanding any other provision herein, any such loss, liability, claim,
damage or expense shall only give rise under the indemnity agreement contained
in this Section 6 to liability for NAI if such loss, liability, claim, damage or
expense arises out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with written
information furnished to the Company by NAI or the Selling Stockholder expressly
for use in the Registration Statement (or any amendment thereto), the Time of
Sale Information or the Prospectus (or any amendment or supplement thereto) or
any free writing prospectus that the Company has filed, or is required to file,
pursuant to Rule 433(d) under the 1933 Act (the “NAI Information”); and (y) this
indemnity agreement shall not give rise to liability for the Company or NAI with
respect to any loss, liability, claim, damage or expense to the extent arising
out of any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with written information furnished to
the Company (1) by any Underwriter through the Representative and (2) in the
case of the Company, by NAI or the Selling Stockholder, in each case expressly
for use in the Registration Statement (or any amendment thereto), the Time of
Sale Information, the Prospectus (or any amendment or supplement thereto), or
any free writing prospectus that the Company has filed, or is required to file,
pursuant to Rule 433(c) under the 1933 Act; provided, further, however, that,
notwithstanding any other provision herein, the liability of NAI under the
indemnity agreement contained in this Section 6 shall be limited to an amount
equal to the proceeds (after deducting Underwriters’ discounts but before
expenses) received by the Selling Stockholder from the sale of the Shares by it
under this Agreement.
(b) Indemnification
of Company, NAI, Directors and Officers. Each Underwriter
severally agrees to indemnify and hold harmless the Company, its directors,
affiliates, and officers who signed the Registration Statement, NAI, its
directors and officers, and each person, if any, who controls the Company or NAI
within the meaning of Section 15 of the 1933 Act orSection 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto), the
Time of Sale Information, the Prospectus (or any amendment or supplement
thereto), or any free writing prospectus that the Company has filed, or is
required to file, pursuant to Rule 433(d) under the 1933 Act in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through the Representative expressly for use in the Registration
Statement (or any amendment thereto), the Time of Sale Information, the
Prospectus (or any amendment or supplement thereto), or such free writing
prospectus that the Company has filed, or is required to file, pursuant to Rule
433(d)
18
under the
1933 Act. The Company and NAI acknowledge that the statements set
forth in (i) the last paragraph of the cover page regarding delivery of the
Shares, (ii) the first paragraph under the heading “Commissions and Discounts”
in the “Underwriting” section, (iii) the first, second and third paragraphs
under the heading “Price Stabilization and Short Positions” in the
“Underwriting” section, (iv) the list of Underwriters and their respective
participation in the sale of the Shares, and (v) the sentences related to
concessions and reallowances in any Preliminary Prospectus and the Prospectus
constitute the only information furnished in writing by or on behalf of the
Underwriters for inclusion in any Preliminary Prospectus, Prospectus or any
issuer free writing prospectus. This indemnity agreement will be in
addition to any liabilities which any Underwriter may otherwise
have.
(c) Actions
Against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties
indemnified pursuant to Section 6(a) above, counsel to the indemnified parties
shall be selected by the Representative, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company, except with respect to any action arising primarily out
of any untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with NAI Information, in which case counsel
to the indemnified parties shall be selected by NAI; 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. An indemnifying
party may participate at its own expense in the defense of any such
action. In no event shall the indemnifying parties be liable for 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 6 or Section 7 hereof (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) Settlement
Without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying
19
party
shall not have reimbursed such indemnified party in accordance with such request
prior to the date of such settlement.
7. Contribution. If
the indemnification provided for in Section 6 hereof 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, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and NAI, on the one hand, and the
Underwriters, on the other hand, from the offering of the Shares pursuant to
this Underwriting Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and NAI, on the one hand, and of the Underwriters,
on the other hand, in connection with the statements or omissions which resulted
in such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The
relative benefits received by the Company and NAI, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the Shares
under this Underwriting Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of such Shares (before
deducting expenses) received by the Selling Stockholder bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus.
The
relative fault of the Company and NAI, on the one hand, and the Underwriters, 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 and NAI or by the Underwriters and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The
Company, NAI, and the Underwriters agree that it would not be just and equitable
if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding
the provisions of this Section 7, (i) NAI shall not be required to contribute
any amount in excess of the amount equal to the proceeds (after deducting
Underwriters’ discounts but before expenses) received by NAI and/or the Selling
Stockholder from the sale of the Shares by it under this Agreement, and (ii) no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Shares
20
purchased
and sold by it hereunder exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
For
purposes of this Section 7, each person, if any, who controls an Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
and each director, officer and affiliate of each Underwriter, shall have the
same rights to contribution as such Underwriter, and each director and affiliate
of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company 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. The Underwriters’ respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the principal amount of Shares set forth opposite their respective names in
Schedule 1 hereto, and not joint.
8. Representations, Warranties
and Agreements to Survive Delivery. All representations,
warranties and agreements contained in this Underwriting Agreement or in
certificates of officers of the Company or any of its subsidiaries or of NAI
submitted pursuant hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company or NAI, and shall survive
delivery of and payment for the Shares.
9. Termination.
(a) Underwriting
Agreement. The Representative may terminate this Underwriting
Agreement, by notice to the Company and NAI, at any time at or prior to the
Closing Time, if (i) there has been, since the time of execution of this
Underwriting Agreement or since the respective dates as of which information is
given in the Time of Sale Information, any material adverse change in the
financial condition, results of operations or business affairs of the Company
and its subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) there has occurred any material adverse
change in the financial markets in the United States or any outbreak of
hostilities or escalation thereof or other calamity or crisis or any material
change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of the
Representative, impracticable to market the Shares or to enforce contracts for
the sale of the Shares, or (iii) trading in any securities of the Company has
been suspended or materially limited by the Commission or the New York Stock
Exchange or the American Stock Exchange, or if trading generally on the New York
Stock Exchange or the American Stock Exchange has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by either of said exchanges or by such
system or by order of the Commission, the FINRA or any other governmental
authority or (iv) a banking moratorium has been declared by either Federal or
New York authorities.
21
(b) Liabilities. If this
Underwriting Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party except as
provided in Section 4 hereof, and provided further that Sections 6, 7, 8, 9(b)
and 14 shall survive such termination and remain in full force and effect; provided, however, if any
condition specified in Section 5 hereof shall not have been fulfilled when and
as required to be fulfilled, this Agreement may be terminated by the
Representative by notice to the Company and NAI at any time at or prior to the
Closing Time, and such termination shall be without liability of any other party
except that the provisions of Sections 6, 7, 8, 9(b) and 14 shall survive such
termination and remain in full force and effect.
10. Default by One or More of
the Underwriters. If one or more of the Underwriters shall
fail at the Closing Time to purchase the Shares which it or they are obligated
to purchase at the Closing Time under this Underwriting Agreement (the
“Defaulted Shares”), then the Representative shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Shares in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representative shall not have completed such
arrangements within such 24-hour period, then:
(a) if
the number of Defaulted Shares does not exceed 10% of the total number of Shares
to be purchased at the Closing Time, the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters or in such other
proportions as the Representative may specify, or
(b) if
the number of Defaulted Shares exceeds 10% of the total number of Shares to be
purchased at the Closing Time, the non-defaulting Underwriters shall have the
right to purchase all, but shall not be under any obligation to purchase any, of
the Shares.
No action
taken pursuant to this Section 10 shall relieve any defaulting Underwriter from
liability in respect of its default.
In the
event of any such default which does not result in a termination of this
Underwriting Agreement, either the Representative or the Company shall have the
right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement or the
Prospectus or in any other documents or arrangements.
11. Notices. All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any standard form of
telecommunication, excluding e-mail. Notices to the Underwriters
shall be directed to Citigroup Global Markets Inc. General Counsel, facsimile
(▇▇▇) ▇▇▇-▇▇▇▇, and confirmed to the General Counsel, Citigroup Global Markets
Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇. Notices to NAI shall
be directed to ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, facsimile (▇▇▇) ▇▇▇-▇▇▇▇. Notices to the Company
shall be directed to ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, Executive Vice President, General Counsel and Secretary, phone (▇▇▇)
▇▇▇-▇▇▇▇.
22
12. Parties. This
Underwriting Agreement shall inure to the benefit of and be binding upon the
Company, NAI, the Representative and the other Underwriters and their respective
successors. Nothing expressed or mentioned in this Underwriting
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters, the Company, NAI and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Underwriting
Agreement or any provision herein contained. This Underwriting
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the parties hereto and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Shares from any Underwriter shall be
deemed to be a successor by reason merely of such purchase.
13. No Fiduciary
Relationship. The Company and NAI acknowledge and agree that
(i) the purchase and sale of the Shares pursuant to this Agreement are entered
into on an arm’s-length basis between NAI, on the one hand, and the several
Underwriters, on the other, (ii) in connection therewith, each Underwriter is
acting solely as a principal and not the agent or fiduciary of the Company or
NAI, either before or after the date hereof, and (iii) no Underwriter has
assumed an advisory or fiduciary responsibility in favor of the Company or NAI
with respect to the offering contemplated hereby (irrespective of whether such
Underwriter has advised or is currently advising the Company or NAI on other
matters) or any other obligation to the Company or NAI except the obligations
expressly set forth in this Agreement. The Company, NAI and the
Underwriters agree that they are each responsible for making their own
independent judgments with respect to any such transactions. The
Company and NAI agree that they will not claim that the Underwriters, or any of
them, has rendered advisory services of any nature or respect, or owes a
fiduciary or similar duty to the Company or NAI, in connection with the purchase
and sale of the Shares pursuant to this Agreement.
14. GOVERNING
LAW. THIS UNDERWRITING AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
15. Effect of
Headings. The Article and Section headings herein and the
Table of Contents are for convenience only and shall not affect the construction
hereof.
16. Counterparts. This
Underwriting Agreement may be executed in two or more counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were on the same instrument.
23
If the foregoing is in accordance with
your understanding of our agreement, please sign and return to each of the
Company and NAI a counterpart hereof, whereupon this Underwriting Agreement,
along with all counterparts, will become a binding agreement among each of the
Underwriters, the Company and NAI in accordance with its terms.
|
Very
truly yours,
|
|||
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
||
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
|
||
|
Title:
|
Executive
Vice President, General Counsel and
Secretary
|
||
|
NATIONAL
AMUSEMENTS, INC.
|
|||
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
|
||
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
|
||
|
Title:
|
Vice
President
|
||
|
CONFIRMED
AND ACCEPTED,
as of the date first above written:
|
||
|
CITIGROUP
GLOBAL MARKETS INC.
|
||
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ III
|
|
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇ III
|
|
|
Title:
|
Managing
Director
|
|
|
For
itself and on behalf of the several
Underwriters
listed in Schedule 1 hereto.
|
||
SCHEDULE
1
|
Underwriters
|
Number
of Firm Shares
to
be Purchased
|
Maximum
Number of
Option
Shares
to be
Purchased
|
|||||
|
Citigroup
Global Markets Inc.
|
11,629,767
|
1,162,977
|
|||||
|
▇.▇.
▇▇▇▇▇▇ Securities Inc.
|
7,753,178
|
775,318
|
|||||
|
Total
|
19,382,945
|
1,938,295
|
|||||
Sch
1-1
SCHEDULE
2
Title,
Purchase Price and Description of Shares:
Title:
Class B Common Stock, $0.001 par value
Number of
Firm Shares to be sold by the Selling
Stockholder: 19,382,945
Number of
Option Shares to be sold by the Selling
Stockholder: 1,938,295
Price per
Share to Public: $28.25
Sch
2-1
SCHEDULE 3
FREE
WRITING PROSPECTUSES
None.
Sch
3-1