EXHIBIT 1.1
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FOX ENTERTAINMENT GROUP, INC.
(a Delaware corporation)
72,250,000 Shares of Class A Common Stock
U.S. PURCHASE AGREEMENT
Dated: November __, 1998
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Table of Contents
Page
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SECTION 1. Representations and Warranties..................................................4
(a) Representations and Warranties by the Company.............................4
(i) Compliance with Registration Requirements...................4
(ii) Independent Accountants.....................................6
(iii) Financial Statements........................................6
(iv) No Material Adverse Change in Business......................6
(v) Good Standing of the Company................................7
(vi) Good Standing of Subsidiaries...............................7
(vii) Capitalization..............................................8
(viii) Authorization of Agreement..................................8
(ix) Authorization and Description of Securities.................8
(x) Absence of Defaults and Conflicts...........................8
(xi) Absence of Labor Dispute....................................9
(xiv) Intercompany Agreements.....................................9
(xv) Absence of Proceedings.....................................10
(xvi) Accuracy of Exhibits.......................................10
(xvii) Possession of Intellectual Property........................10
(xviii) Absence of Further Requirements............................11
(xix) Possession of Licenses and Permits.........................11
(xx) Title to Property .........................................11
(xxi) Tax Returns and Payments of Taxes..........................12
(xxii) Investment Company Act.....................................12
(xxiii) Environmental Laws.........................................12
(xxiv) Insurance .................................................13
(xxv) Registration Rights........................................13
(xxvi) No Stabilization or Manipulation...........................13
(b) Officer Certificates.....................................................13
SECTION 2. Sale and Delivery to International Managers; Closing...........................14
(a) Initial Securities.......................................................14
(b) Option Securities........................................................14
(c) Payment .................................................................14
(d) Denominations; Registration..............................................15
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SECTION 3. Covenants of the Company.......................................................15
(a) Compliance with Securities Regulations and Commission
Requests.................................................................15
(b) Filing of Amendments ...................................................16
(c) Delivery of Registration Statements......................................16
(d) Delivery of Prospectuses.................................................16
(e) Continued Compliance with Securities Laws................................17
(f) Blue Sky Qualifications..................................................17
(g) Rule 158 ................................................................18
(h) Use of Proceeds..........................................................18
(i) Listing..................................................................18
(j) Restriction on Sale of Securities........................................18
(k) Reporting Requirements...................................................18
(l) Compliance with NASD Rules...............................................19
(m) Compliance with Rule 463.................................................19
SECTION 4. Payment of Expenses............................................................19
(a) Expenses.................................................................19
(b) Termination of Agreement.................................................20
SECTION 5. Conditions of International Managers' Obligations...............................20
(a) Effectiveness of Registration Statement...................................20
(b) Opinion of Counsel for Company............................................20
(c) Opinion of Regulatory Counsel for Company.................................21
(d) Opinion of Counsel for International Managers.............................21
(e) Officers' Certificate.....................................................21
(f) Accountant's Comfort Letter...............................................22
(g) Bring-down Comfort Letter.................................................22
(h) Approval of Listing.......................................................22
(i) No Objection.............................................................22
(j) Lock-up Agreements........................................................22
(k) Purchase of Initial U.S. Securities.......................................22
(l) Recapitalization and Reorganization.......................................23
(m) Conditions to Purchase of International
Option Securities.........................................................23
(n) Additional Documents......................................................24
(o) Termination of Agreement..................................................24
SECTION 6. Indemnification.................................................................24
(a) Indemnification of International Managers.................................24
(b) Indemnification of Company, Directors and Officers........................26
(c) Actions against Parties; Notification.....................................26
(d) Settlement without Consent if Failure to Reimburse........................27
(e) Indemnification for Reserved Securities...................................27
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SECTION 7. Contribution....................................................................27
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.......................................................................29
SECTION 9. Termination of Agreement........................................................29
(a) Termination; General......................................................29
(b) Liabilities...............................................................29
SECTION 10. Default by One or More of the International Managers............................30
SECTION 11. Notices.........................................................................30
SECTION 12. Parties.........................................................................31
SECTION 13. GOVERNING LAW AND TIME..........................................................31
SECTION 14. Effect of Headings..............................................................31
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FOX ENTERTAINMENT GROUP, INC.
(a Delaware corporation)
72,250,000 Shares of Class A Common Stock
(Par Value $0.01 Per Share)
U.S. PURCHASE AGREEMENT
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November _, 1998
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
XXXXX & COMPANY INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
XXXXXXX XXXXX BARNEY INC.
as Representatives of the several Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Fox Entertainment Group, Inc., a Delaware corporation (the "Company"),
confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated (together, "Xxxxxxx Xxxxx") and each of the other U.S.
Underwriters named in Schedule A hereto (collectively, the "U.S. Underwriters,"
which term shall also include any underwriter substituted as hereinafter
provided in Section 10 hereof), for whom Xxxxxxx Xxxxx, Xxxxx & Company
Incorporated, Xxxxxxx, Sachs & Co., Xxxxxx Xxxxxxx & Co.
Incorporated, Bear, Xxxxxxx & Co. Inc., Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, X.X. Xxxxxx Securities Inc., NationsBanc Xxxxxxxxxx Securities LLC,
and Xxxxxxx Xxxxx Barney Inc. are acting as representatives (in such capacity,
the "U.S. Representatives"), with respect to the issue and sale by the Company
and the purchase by the U.S. Underwriters, acting severally and not jointly, of
the respective number of shares of Class A Common Stock, par value $0.01 per
share, of the Company (the "Class A Common Stock" and, together with the Class B
Common Stock, par value $0.01 per share, of the Company, the "Common Stock") set
forth in said Schedule A, and with respect to the grant by the Company to the
Underwriters, acting severally and not jointly, of the option described in
Section 2(b) hereof to purchase all or any part of 10,625,000 additional shares
of Class A Common Stock solely to cover over-allotments, if any. The aforesaid
72,250,000 shares of Class A Common Stock (the "Initial U.S. Securities") to be
purchased by the U.S. Underwriters and all or any part of the 10,625,000 shares
of Class A Common Stock subject to the option described in Section 2(b) hereof
(the "U.S. Option Securities") are hereinafter called, collectively, the "U.S.
Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "International Purchase Agreement")
providing for the offering by the Company of an aggregate of 12,750,000 shares
of Class A Common Stock (the "Initial International Securities") through
arrangements with certain underwriters outside the United States and Canada (the
"International Managers") for which Xxxxxxx Xxxxx International, Xxxxx & Company
Incorporated, Xxxxxxx Xxxxx International, Xxxxxx Xxxxxxx & Co. International
Limited, Bear, Xxxxxxx International Limited, Xxxxxxxxx, Xxxxxx & Xxxxxxxx
International, X.X. Xxxxxx Securities Ltd., NationsBanc Xxxxxxxxxx Securities
LLC and Salomon Brothers International Limited are acting as lead managers (the
"Lead Managers") and the grant by the Company to the International Managers,
acting severally and not jointly, of an option to purchase all or any part of
the International Managers' pro rata portion of up to 1,875,000 additional
shares of Class A Common Stock solely to cover overallotments, if any (the
"International Option Securities" and, together with the U.S. Option Securities,
the "Option Securities"). The Initial International Securities and the
International Option Securities are hereinafter called the "International
Securities." It is understood that the Company is not obligated to sell and the
U.S. Underwriters are not obligated to purchase, any Initial U.S. Securities
unless all of the Initial International Securities are contemporaneously
purchased by the International Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "Underwriters," the Initial U.S. Securities and the
Initial International Securities are hereinafter collectively called the
"Initial Securities,"
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and the U.S. Securities and the International Securities are hereinafter
collectively called the "Securities."
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (in
such capacity, the "Global Coordinator").
The Company understands that the U.S. Underwriters propose to make a public
offering of the U.S. Securities as soon as the U.S. Representatives deem
advisable after this Agreement has been executed and delivered.
The Company and the U.S. Underwriters agree that up to_________ shares of
the Initial U.S. Securities to be purchased by the U.S. Underwriters ( the
"Reserved Securities") shall be reserved for sale by the Underwriters to certain
eligible employees of The News Corporation Limited, the Company and their
respective subsidiaries and certain persons having business relationships with
the Company ("Reserved Securities Participants"), as part of the distribution of
the Securities by the Underwriters, subject to the terms of this Agreement, the
applicable rules, regulations and interpretations of the National Association of
Securities Dealers, Inc. and all other applicable laws, rules and regulations.
To the extent that such Reserved Securities are not orally confirmed for
purchase by such eligible employees and persons having business relationships
with the Company by the end of the first business day after the date of this
Agreement, such Reserved Securities may be offered to the public as part of the
public offering contemplated hereby.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-61515) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of
the 1933 Act Regulations or (ii) if the Company has elected to rely upon Rule
434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b).
Two forms of prospectus are to be used in connection with the offering and sale
of the Securities: one relating to the U.S. Securities (the "Form of U.S.
Prospectus") and one relating to the International Securities (the "Form of
International Prospectus"). The Form of International Prospectus is identical
to the Form of U.S. Prospectus, except for the front cover and back cover pages
and the
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information under the caption "Underwriting." The information included in any
such prospectus or in any such Term Sheet, as the case may be, that was omitted
from such registration statement at the time it became effective but that is
deemed to be part of such registration statement at the time it became effective
(a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A
Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as
"Rule 434 Information." Each Form of U.S. Prospectus and Form of International
Prospectus used before such registration statement became effective, and any
prospectus that omitted, as applicable, the Rule 430A Information or Rule 434
Information, that was used after such effectiveness and prior to the execution
and delivery of this Agreement, is herein called a "preliminary prospectus."
Such registration statement, including the exhibits thereto and schedules
thereto at the time it became effective and including the Rule 430A Information
and the Rule 434 Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule 462(b) of the
1933 Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final Form of U.S.
Prospectus and the final Form of International Prospectus in the forms first
furnished to the Underwriters for use in connection with the offering of the
Securities are herein called the "U.S. Prospectus" and the "International
Prospectus," respectively, and collectively, the "Prospectuses." If Rule 434 is
relied on, the terms "U.S. Prospectus" and "International Prospectus" shall
refer to the preliminary U.S. Prospectus dated October 20, 1998 and preliminary
International Prospectus dated October 20, 1998, respectively, each together
with the applicable Term Sheet and all references in this Agreement to the date
of such Prospectuses shall mean the date of the applicable Term Sheet. For
purposes of this Agreement, all references to the Registration Statement, any
preliminary prospectus, the U.S. Prospectus, the International Prospectus or any
Term Sheet or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each U.S. Underwriter as of the date hereof and as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof and agrees with each U.S.
Underwriter as follows:
(i) Compliance with Registration Requirements. Each of the Registration
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Statement and any Rule 462(b) Registration Statement has become effective
under the 1933 Act and no stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration
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Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted or are pending or, to the knowledge of the Company, are
contemplated by the Commission, and any request on the part of the Commission
for additional information from the Company has been satisfied in all material
respects.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), the Registration Statement, any Rule 462(b)
Registration Statement and any amendments and supplements thereto complied and
will comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and did not and 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, and the
Prospectuses, any preliminary prospectuses and any supplement thereto or
prospectus wrapper prepared in connection therewith, at their respective times
of issuance and at the Closing Time, complied and will comply in all material
respects with any applicable laws or regulations of foreign jurisdictions in
which the Prospectuses and such preliminary prospectuses, as amended or
supplemented, if applicable, are distributed in connection with the offer and
sale of Reserved Securities. Neither of the Prospectuses nor any amendments or
supplements thereto (including any prospectus wrapper), at the time the
Prospectuses or any amendments or supplements thereto were issued and at the
Closing Time (and, if any U.S. Option Securities are purchased, at the Date of
Delivery), included or will include an untrue statement of a material fact or
omitted or will 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. If Rule 434 is used, the Company will comply with the
requirements of Rule 434 and the Prospectuses shall not be "materially
different," as such term is used in Rule 434, from the prospectuses included in
the Registration Statement at the time it became effective. The representations
and warranties in this subsection shall not apply to statements in or omissions
from the Registration Statement or the U.S. Prospectus made in reliance upon and
in conformity with information furnished to the Company in writing by any U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement or the U.S. Prospectus.
Each preliminary prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and each preliminary prospectus
and the Prospectuses delivered to the Underwriters
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for use in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
The Company has filed a registration statement pursuant to Section 12(b) of
the Securities Exchange Act of 1934 (the "1934 Act"), to register the Class A
Common Stock, and such registration statement has been declared effective.
(ii) Independent Accountants. The accountants who certified the financial
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statements and supporting schedules included in the Registration Statement are
independent public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iii) Financial Statements. The combined financial statements included in
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the Registration Statement and the Prospectuses, together with the related
schedules and notes, present fairly the financial position of the Company, its
subsidiaries and the predecessor entities to the Company at the dates indicated
and the combined statement of operations, shareholders' equity and cash flows of
the Company, its subsidiaries and the predecessor entities to the Company for
the periods specified; said 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 present fairly in accordance with
GAAP the information required to be stated therein. The selected financial data
and the summary financial information included in the Prospectuses present
fairly 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 pro forma financial statements of the Company and
its subsidiaries and the related notes thereto included in the Registration
Statement and the Prospectuses present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly compiled on the
bases described therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect to
the transactions and circumstances referred to therein.
(iv) No Material Adverse Change in Business. Since the respective dates as
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of which information is given in the Registration Statement and the
Prospectuses, except as otherwise stated therein or contemplated thereby, (A)
there has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries (as defined in
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Regulation S-X) (each a "Subsidiary" and, collectively, the "Subsidiaries")
considered as one enterprise, whether or not arising in the ordinary course of
business (a "Material Adverse Effect"), (B) there have been no transactions
entered into by the Company or any of its Subsidiaries which are material to the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its Subsidiaries considered as one
enterprise, and (C) there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(v) Good Standing of the Company. The Company has been duly organized and
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is validly existing as a corporation in good standing under the laws of the
State of Delaware and has the corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectuses and to enter into and perform its obligations under this Agreement;
and 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 failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(vi) Good Standing of Subsidiaries. Each of the Subsidiaries has been duly
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organized and is validly existing as a limited liability company, corporation,
limited partnership or general partnership in good standing under the laws of
the jurisdiction of its organization, has the requisite power and authority to
own, lease and operate its properties and to conduct its business as described
in the Prospectuses and is duly qualified as a foreign limited liability
company, corporation, limited partnership or general partnership 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 failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; except as
otherwise described in the Registration Statement, all of the issued and
outstanding capital stock of each Subsidiary that is a corporation has been duly
authorized and validly issued, is fully paid and non-assessable and is owned by
the Company, directly or through Subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock, limited liability company interests or
partnership interests of any of the Subsidiaries was issued in violation of any
preemptive or similar rights arising by operation of law, or under the charter,
by-laws, certificate of formation, limited liability company agreement,
partnership agreement, or
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other organizational documents of any Subsidiary or under any agreement to which
the Company or any Subsidiary is a party.
(vii) Capitalization. The authorized, issued and outstanding capital
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stock of the Company is as set forth in the Prospectuses in the column entitled
"Pro Forma" under the caption "Capitalization" (except for subsequent issuances,
if any, pursuant to this Agreement, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the Prospectuses).
The shares of issued and outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in violation of
the preemptive or other similar rights of any securityholder of the Company.
(viii) Authorization of Agreement. This Agreement and the International
--------------------------
Purchase Agreement have been duly authorized, executed and delivered by the
Company.
(ix) Authorization and Description of Securities. The Securities to be
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purchased by the U.S. Underwriters and the International Managers from the
Company have been duly authorized for issuance and sale to the U.S. Underwriters
pursuant to this Agreement and to the International Managers pursuant to the
International Purchase Agreement, respectively, and, when issued and delivered
by the Company pursuant to this Agreement and the International Purchase
Agreement, respectively, against payment of the consideration set forth herein
and the International Purchase Agreement, respectively, will be validly issued,
fully paid and non-assessable; the Common Stock conforms to all statements
relating thereto contained in the Prospectuses and such description conforms to
the rights set forth in the instruments defining the same; no holder of the
Securities will be subject to personal liability by reason of being such a
holder; and the issuance of the Securities is not subject to the preemptive or
other similar rights of any securityholder of the Company.
(x) Absence of Defaults and Conflicts. Neither the Company nor any of
---------------------------------
its Subsidiaries is in violation of its charter, by-laws, certificate of
formation, limited liability company agreement, partnership agreement, or other
organizational documents or in default in the performance or observance of 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
property or assets of the Company or
8
any of its Subsidiaries is subject (collectively, "Agreements and Instruments")
except for such violations and defaults that would not result in a Material
Adverse Effect; and the execution, delivery and performance of this Agreement
and the International Purchase Agreement and the consummation of the
transactions contemplated in this Agreement, the International Purchase
Agreement and in the Registration Statement (including the Recapitalization (as
defined in the Prospectuses), the Reorganization (as defined in the
Prospectuses), the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectuses under
the caption "Use of Proceeds") and compliance by the Company with its
obligations under this Agreement and the International Purchase Agreement have
been duly authorized by all necessary corporate action and 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 a Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
Subsidiaries pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that, singly
or in the aggregate, would not result in a Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter, by-laws,
certificate of formation, limited liability company agreement, partnership
agreement, or other organizational documents 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. 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.
(xi) Absence of Labor Dispute. Except as disclosed in the Prospectus, no
------------------------
labor dispute with the employees of the Company or any Subsidiary exists or, to
the knowledge of the Company, none are imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of its or any
Subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, may reasonably be expected to result in a Material
Adverse Effect.
(xii) Intercompany Agreements. Each of the Master Intercompany Agreement
-----------------------
and the Tax Sharing Agreement (each as defined in the Prospectuses) has been
duly authorized, executed and delivered by
9
the Company and its Subsidiaries, as applicable, and constitutes the binding
agreement of such party, enforceable against such party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(xiii) 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 (including, but not limited to the Federal
Communications Commission ("FCC")), now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any Subsidiary which is
required to be disclosed in the Registration Statement (other than as disclosed
therein), or which might reasonably be expected to result in a Material Adverse
Effect, or which might reasonably be expected to materially and adversely affect
the consummation of the transactions contemplated in this Agreement and the
International Purchase Agreement or the performance by the Company of its
obligations hereunder or thereunder; the aggregate of all pending legal or
governmental proceedings to which the Company or any Subsidiary is a party or of
which any of their respective property or assets is the subject which are not
described in the Registration Statement, including ordinary routine litigation
incidental to the business, would not reasonably be expected to result in a
Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents which are
--------------------
required to be described in the Registration Statement or the Prospectuses or to
be filed as exhibits thereto which have not been so described and filed as
required.
(xv) Possession of Intellectual Property. Except as disclosed in the
-----------------------------------
Prospectus, the Company and its Subsidiaries own or possess, or can acquire on
reasonable terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business now
operated by them as described in the Prospectus, and neither the Company nor any
of its Subsidiaries has received any written notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its
10
Subsidiaries therein, and which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or
in the aggregate, would result in a Material Adverse Effect.
(xvi) 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 is necessary or required for the
performance by the Company of its obligations hereunder, in connection with the
offering, issuance or sale of the Securities under this Agreement and the
International Purchase Agreement or the consummation of the transactions
contemplated by this Agreement and the International Purchase Agreement, except
(i) such as have been already obtained or as may be required under the 1933 Act
or the 1933 Act Regulations and foreign or state securities or blue sky laws,
(ii) such as have been already obtained or may be required under the
Communications Act of 1934, as amended and (iii) such as have been obtained
under the laws and regulations of jurisdictions outside the United States in
which the Reserved Securities are offered.
(xvii) Possession of Licenses and Permits. The Company and its
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Subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies (including,
without limitation, the FCC) necessary to conduct the businesses now operated by
them, except where the failure to possess Governmental Licenses would not,
singly or in the aggregate, have a Material Adverse Effect; the Company and its
Subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not, singly
or in the aggregate, have a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, for the maximum license term
customarily issued, with no material conditions, restrictions or qualifications,
except when the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a Material
Adverse Effect; and neither the Company nor any of its Subsidiaries has received
any notice of proceedings relating to the revocation, modification, non-renewal
or suspension of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.
(xviii) Title to Property. The Company and its Subsidiaries have good
-----------------
and marketable title to all real property owned by the Company and its
Subsidiaries and good title to all other properties owned by them, in
11
each case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (a) are
described in the Prospectuses or (b) would not, singly or in the aggregate,
reasonably be expected to result in a Material Adverse Effect; and all of the
leases and subleases material to the business of the Company and its
Subsidiaries, considered as one enterprise, and under which the Company or any
of its Subsidiaries holds properties described in the Prospectuses, are in full
force and effect, and neither the Company nor any of its Subsidiaries has any
notice of any material claim of any sort that has been asserted by anyone
adverse to the rights of the Company or any of its Subsidiaries under any of the
leases or subleases mentioned above, or affecting or questioning the rights of
such the Company or any Subsidiary thereof to the continued possession of the
leased or subleased premises under any such lease or sublease.
(xix) Tax Returns and Payment of Taxes. The Company and its Subsidiaries
--------------------------------
have timely filed all federal, state, local and foreign tax returns that are
required to be filed or have duly requested extensions thereof and all such tax
returns are true, correct and complete. The Company and its Subsidiaries have
timely paid all taxes required to be paid by any of them and any related
assessments, fines or penalties, except for any such tax, assessment, fine or
penalty that is being contested in good faith and by appropriate proceedings;
and adequate charges, accruals and reserves have been provided for in the
financial statements referred to in Section 1(a)(iii) above in respect of all
federal, state, local and foreign taxes for all periods as to which the tax
liability of the Company or any of its Subsidiaries has not been finally
determined or remains open to examination by applicable taxing authorities. The
Company is not a "United States real property holding corporation" within the
meaning of Section 897(c)(3) of the Internal Revenue Code of 1986, as amended.
(xx) Investment Company Act. The Company is not, and upon the issuance
----------------------
and sale of the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectuses will not be, an "investment
company" or an entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940 Act").
(xxi) Environmental Laws. Except as described in the Registration
------------------
Statement and except such matters as would not, singly or in the aggregate,
result in a Material Adverse Effect, (A) neither the Company nor any of its
Subsidiaries is in violation of any federal, state, local or foreign statute,
law, rule, regulation, ordinance, code, policy or rule of common law or any
judicial or administrative interpretation thereof,
12
including any judicial or administrative order, consent, decree or judgment,
relating to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its Subsidiaries have all permits, authorizations
and approvals required under any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no pending or threatened
administrative, regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against the Company or any of its
Subsidiaries and (D) there are no events or circumstances that might reasonably
be expected to form the basis of an order for clean-up or remediation, or an
action, suit or proceeding by any private party or governmental body or agency,
against or affecting the Company or any of its Subsidiaries relating to
Hazardous Materials or Environmental Laws.
(xxii) Insurance. The Company and each of its Subsidiaries is insured by
---------
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which they
will be engaged; and neither the Company nor any of its Subsidiaries has any
reason to believe that any of them will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its business.
(xxiii) Registration Rights. There are no persons with registration
-------------------
rights or other similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under the 1933
Act.
(xxiv) No Stabilization or Manipulation. The Company has not taken and
--------------------------------
will not take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of the
price of the Securities in violation of Regulation M under the 1934 Act.
(b) Officer Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries delivered to the Global Coordinator, the U.S.
13
Representatives or to counsel for the U.S. Underwriters shall be deemed a
representation and warranty by the Company to each U.S. Underwriter as to the
matters covered thereby.
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.
-----------------------------------------------
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each U.S. Underwriter, severally and not jointly, and
each U.S. Underwriter, severally and not jointly, agrees to purchase from the
Company, at the price per share set forth in Schedule B, the number of Initial
U.S. Securities set forth in Schedule A opposite the name of such U.S.
Underwriter, plus any additional number of Initial U.S. Securities which such
U.S. Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the U.S. Underwriters,
severally and not jointly, to purchase up to an additional 10,625,000 shares of
Common Stock at the price per share set forth in Schedule B, less an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial U.S. Securities but not payable on the U.S. Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial U.S. Securities upon notice by the Global
Coordinator to the Company setting forth the number of U.S. Option Securities as
to which the several U.S. Underwriters are then exercising the option and the
time and date of payment and delivery for such U.S. Option Securities. Any such
time and date of delivery for the U.S. Option Securities (a "Date of Delivery")
shall be determined by the Global Coordinator, but shall not be later than seven
full business days after the exercise of said option, nor in any event prior to
the Closing Time, as hereinafter defined. If the option is exercised as to all
or any portion of the U.S. Option Securities, each of the U.S. Underwriters,
acting severally and not jointly, will purchase that proportion of the total
number of U.S. Option Securities then being purchased which the number of
Initial U.S. Securities set forth in Schedule A opposite the name of such U.S.
Underwriter bears to the total number of Initial U.S. Securities, subject in
each case to such adjustments as the Global Coordinator in its discretion shall
make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 919 Third Avenue, New York, New York,
or at such other place as shall be agreed upon by the Global Coordinator and the
14
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 p.m. (Eastern time) on any given day) business day after the date
hereof (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 Global Coordinator and the Company (such time and date of
payment and delivery being herein called the "Closing Time").
In addition, in the event that any or all of the U.S. Option Securities are
purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Company, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the U.S. Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the U.S. Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the Initial U.S. Securities and the U.S. Option Securities, if any,
which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the U.S. Underwriters may (but shall not be obligated to) make
payment of the purchase price for the Initial U.S. Securities or the U.S. Option
Securities, if any, to be purchased by any U.S. Underwriter whose funds have not
been received by the Closing Time or the relevant Date of Delivery, as the case
may be, but such payment shall not relieve such U.S. Underwriter from its
obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
U.S. Securities and the U.S. Option Securities, if any, will be made available
for examination and packaging by the U.S. Representatives in The City of New
York not later than 10:00 A.M. (Eastern time) on the business day prior to the
Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each U.S.
------------------------
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Global Coordinator
15
immediately, and confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall become effective, or any
supplement to the Prospectuses or any amended Prospectuses shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectuses or for additional information, and
(iv) of 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 any preliminary prospectus, or of the suspension of the
qualification of the Securities 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(b) and
will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such 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. The Company will give the Global Coordinator
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectuses,
will furnish the Global Coordinator with copies of any such documents 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 Global Coordinator
or counsel for the U.S. Underwriters shall reasonably object, except as the
Company may reasonably determine is necessary to comply with applicable laws.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the U.S. Representatives and counsel for the U.S. Underwriters,
without charge, copies of the Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the U.S. Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the U.S. Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to the
U.S. Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each U.S.
Underwriter, without charge, as many copies of each preliminary prospectus as
16
such U.S. Underwriter reasonably requested, and the Company hereby consents to
the use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each U.S. Underwriter, without charge, during the period when the
U.S. Prospectus is required to be delivered under the 1933 Act or the Securities
Exchange Act of 1934 (the "1934 Act"), such number of copies of the U.S.
Prospectus (as amended or supplemented) as such U.S. Underwriter may reasonably
request. The U.S. Prospectus and any amendments or supplements thereto
furnished to the U.S. Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations so as to permit the completion of
the distribution of the Securities as contemplated in this Agreement, the
International Purchase Agreement and in the Prospectuses. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the U.S. Underwriters or
for the Company, to amend the Registration Statement or amend or supplement any
Prospectus in order that the Prospectuses will not include any untrue statements
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 such counsel, at any such time to amend the Registration Statement or
amend or supplement any Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectuses comply with such requirements, and
the Company will furnish to the U.S. Underwriters such number of copies of such
amendment or supplement as the U.S. Underwriters may reasonably request. The
Underwriters shall notify the Company upon their completion of the distribution
of the Securities as contemplated by this Agreement, the International Purchase
Agreement and in the Prospectuses.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the U.S. Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Global Coordinator may designate and
to maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; 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
17
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. In each jurisdiction in which the Securities have
been so qualified, the Company will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification in
effect for a period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable 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.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectuses
under "Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect the listing
of the Class A Common Stock (including the Securities) on the New York Stock
Exchange.
(j) Restriction on Sale of Securities. During a period of 180 days from
the date of the Prospectuses, the Company will not, without the prior written
consent of the Global Coordinator, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder or under the International Purchase
Agreement or (B) any shares of Common Stock issued or options to purchase Common
Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectuses.
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
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 rules and
regulations of the Commission thereunder.
18
(l) Compliance with NASD Rules. The Company hereby agrees that it will
ensure that the Reserved Securities will be restricted as required by the
National Association of Securities Dealers, Inc. (the "NASD") under NASD Rule
2110(d) from sale, transfer, assignment, pledge or hypothecation for a period of
three months following the date of this Agreement. The Underwriters will notify
the Company as to which persons will need to be so restricted. At the request
of the Underwriters, the Company will direct the transfer agent to place a stop
transfer restriction upon such securities for such period of time. Should the
Company release, or seek to release, from such restrictions any of the Reserved
Securities, the Company agrees to reimburse the Underwriters for any reasonable
expenses (including, without limitation, legal expenses) they incur in
connection with such release.
(m) Compliance with Rule 463. The Company will file with the Commission
such information regarding the use of the net proceeds of the Offering as may be
required pursuant to Rule 463 of the 1933 Act Regulations.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
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 Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Securities to the Underwriters and the transfer of
the Securities between the U.S. Underwriters and the International Managers,
(iv) the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) the qualification of the Securities under securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of the Blue Sky
Survey and any supplement thereto, (vi) the printing and delivery to the
Underwriters of copies of each preliminary prospectus, any Term Sheets and of
the Prospectuses and any amendments or supplements thereto, (vii) the
preparation, printing and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (viii) the transportation and other expenses
incurred by the Company in connection with presentations to prospective
purchasers of the Securities, (ix) the fees and expenses of any transfer agent
or registrar for the Securities and (x) the filing fees incident to, and the
fees and disbursements of counsel to the Underwriters in connection with, the
review by the NASD of the
19
terms of the sale of the Securities, (xi) the fees and expenses incurred in
connection with the listing of the Securities on the New York Stock Exchange,
and (xii) all reasonable costs and expenses of the Underwriters, including the
reasonable fees and disbursements of counsel for the Underwriters, in connection
with matters related to the Reserved Securities.
(b) Termination of Agreement. If this Agreement is terminated by the U.S.
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the U.S. Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the U.S. Underwriters.
SECTION 5. Conditions of U.S. Underwriters' Obligations. The obligations
--------------------------------------------
of the several U.S. Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its Subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the U.S. Underwriters. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) Opinion of Counsel for Company. At the Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of the
Closing Time, of Squadron, Ellenoff, Plesent & Xxxxxxxxx, LLP, counsel for the
Company, in form and substance satisfactory to counsel for the U.S.
Underwriters, together with signed or reproduced copies of such letter for each
of the other U.S. Underwriters to the effect set forth in Exhibit A hereto and
to such further effect as counsel to the U.S. Underwriters may reasonably
request. In giving such opinion such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the law of the State of New
York, the federal law of the United States and the General Corporation Law of
the State of Delaware, upon the opinions of counsel satisfactory to the U.S.
Representatives. Such counsel may also state that, insofar
20
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its Subsidiaries
and certificates of public officials.
(c) Opinion of Regulatory Counsel for Company. At the Closing Time, the
U.S. Representatives shall have received the favorable opinion, dated as of the
Closing Time, of Xxxxx & Xxxxxxx L.L.P., special counsel for the Company, in
form and substance satisfactory to counsel for the U.S. Underwriters, together
with signed or reproduced copies of such letter for each of the other U.S.
Underwriters to the effect set forth in Exhibit B hereto and to such further
effect as counsel to the U.S. Underwriters may reasonably request. In giving
such opinion, such counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its Subsidiaries and certificates of
public officials.
(d) Opinion of Counsel for U.S. Underwriters. At the Closing Time, the
U.S. Representatives shall have received the favorable opinion, dated as of the
Closing Time, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the U.S.
Underwriters, together with signed or reproduced copies of such letter for each
of the other U.S. Underwriters with respect to the matters set forth in (i),
(v), (vi) (solely as to preemptive or other similar rights arising by operation
of law or under the charter or bylaws of the Company), (viii) through (x),
inclusive, (xiv) (solely as to the information in the Prospectuses under
"Description of the Capital Stock -- Class A Common Stock and Class B Common
Stock") and the penultimate paragraph of Exhibit A hereto. In giving such
opinion such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York, the federal law of
the United States and the General Corporation Law of the State of Delaware, upon
the opinions of counsel satisfactory to the U.S. Representatives. Such counsel
may also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company and its Subsidiaries and certificates of public officials.
(e) Officers' Certificate. At the Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, except as otherwise stated therein or contemplated
thereby, any material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the Company and
its Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the U.S. Representatives shall have received a
certificate of the President, Chief Executive Officer or a Senior Executive Vice
President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of the Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations and warranties in
Section 1 hereof are true and correct with the same force and effect as though
expressly made at and as of
21
the Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions, set forth herein or contemplated hereby, on its part
to be performed or satisfied at or prior to the Closing Time and (iv) no stop
order suspending the effectiveness of the Registration Statement has been issued
and to the knowledge of the Company, no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(f) Accountant's Comfort Letters. At the time of the execution of this
Agreement, the U.S. Representatives shall have received (i) from Xxxxxx Xxxxxxxx
LLP a letter dated such date, in form and substance satisfactory to the U.S.
Representatives, together with signed or reproduced copies of such letter for
each of the other U.S. 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
in the Registration Statement and the Prospectuses and (ii) from Ernst & Young
LLP a letter dated such date, in form and substance satisfactory to the U.S.
Representatives, together with signed or reproduced copies of such letter for
each of the other U.S. Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the NWCG Holdings Corporation financial statements and certain
financial information contained in the Registration Statement and the
Prospectuses.
(g) Bring-down Comfort Letters. At the Closing Time, the Representatives
shall have received from each of Xxxxxx Xxxxxxxx LLP and Ernst & Young LLP a
letter, dated as of the Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (f) of this
Section, except that the specified date referred to shall be a date not more
than three business days prior to the Closing Time.
(h) Approval of Listing. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange, subject only to official
notice of issuance.
(i) No Objection. The NASD shall have confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(j) Lock-up Agreement. At the date of this Agreement, the U.S.
Representatives shall have received an agreement substantially in the form of
Exhibit C hereto signed by the persons listed on Schedule C hereto.
(k) Purchase of Initial International Securities. Contemporaneously with
the purchase by the U.S. Underwriters of the Initial U.S. Securities under this
22
Agreement, the International Managers shall have purchased the Initial
International Securities under the International Purchase Agreement.
(l) Recapitalization and Reorganization. Prior to Closing Time, the
Company shall have effected the Recapitalization (as defined and described in
the Prospectuses) and consummated the Reorganization (as defined and described
in the Prospectuses).
(m) Conditions to Purchase of U.S. Option Securities. In the event that
the U.S. Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the U.S. Option Securities, the representations
and warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any subsidiary of the Company hereunder
shall be true and correct as of each Date of Delivery and, at the relevant Date
of Delivery, the U.S. Representatives shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President, Chief Executive Officer or a Senior
Executive Vice President of the Company and of the chief financial or
chief accounting officer of the Company confirming that the certificate
delivered at the Closing Time pursuant to Section 5(e) hereof remains
true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of
Squadron, Ellenoff, Plesent & Xxxxxxxxx, LLP, counsel for the Company,
in form and substance satisfactory to counsel for the U.S. Underwriters,
dated such Date of Delivery, relating to the U.S. Option Securities to
be purchased on such Date of Delivery and otherwise to the same effect
as the opinion required by Section 5(b) hereof.
(iii) Opinion of Regulatory Counsel for Company. The favorable
opinion of Xxxxx & Xxxxxxx L.L.P., special counsel for the Company, in
form and substance satisfactory to counsel for the U.S. Underwriters,
dated such Date of Delivery, relating to the U.S. Option Securities to
be purchased on such Date of Delivery and otherwise to the same effect
as the opinion required by Section 5(c) hereof.
(iv) Opinion of Counsel for U.S. Underwriters. The favorable
opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
U.S. Underwriters, dated such Date of Delivery, relating to the U.S.
Option Securities to be purchased on such Date of Delivery and otherwise
to the same effect as the opinion required by Section 5(d) hereof.
23
(v) Bring-down Comfort Letter. A letter from Xxxxxx Xxxxxxxx
LLP, in form and substance satisfactory to the U.S. Representatives and
dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the U.S. Representatives pursuant
to Section 5(g) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than five
days prior to such Date of Delivery.
(n) Additional Documents. At the Closing Time and at each Date of
Delivery, counsel for the U.S. 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 validity of the issuance and sale of the
Securities 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 in
connection with the issuance and sale of the Securities as herein contemplated
shall be satisfactory in form and substance to the U.S. Representatives and
counsel for the U.S. Underwriters.
(o) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement or, in the case of any condition to the purchase of U.S. Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several U.S. Underwriters to purchase the relevant Option
Securities may be terminated by the U.S. Representatives by notice to the
Company at any time at or prior to the Closing Time or such Date of Delivery, as
the case may be, and such termination shall be without liability of any party to
any other party except as provided in Section 4 and except that Sections 1, 6, 7
and 8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification of U.S. Underwriters. The Company agrees to indemnify
and hold harmless each U.S. Underwriter and each person, if any, who controls
any U.S. 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), including the Rule
430A Information and the Rule 434 Information, if applicable, 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
24
in any preliminary prospectus or the Prospectuses (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, arising out of (A) the violation of any
applicable laws or regulations of foreign jurisdictions in connection
with the offer and sale of the Reserved Securities and (B) any untrue
statement or alleged untrue statement of a material fact included in the
supplement or prospectus wrapper material distributed in [Insert
Applicable Jurisdiction(s)] in connection with the reservation and sale
of the Reserved Securities to eligible employees of, and persons having
business relations with, the Company or the omission or alleged omission
therefrom of a material fact necessary to make the statements therein,
when considered in conjunction with the Prospectuses or preliminary
prospectuses, not misleading;
(iii) 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 or in connection with any
violation of the nature referred to in Section 6(a)(ii)(A) hereof;
provided that (subject to Section 6(d) below) any such settlement is
effected with the written consent of the Company; and
(iv) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), 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 or in connection with any
violation of the nature referred to in Section 6(a)(ii)(A) hereof, to
the extent that any such expense is not paid under (i), (ii) or (iii)
above;
provided, however, that this indemnity agreement shall not apply to any loss,
-------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and
25
the Rule 434 Information, if applicable, or any preliminary prospectus or the
U.S. Prospectus (or any amendment or supplement thereto).
(b) Indemnification of Company, Directors and Officers. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers 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 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), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary U.S. prospectus or
the U.S. Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by such
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the U.S. Prospectus (or any amendment or supplement thereto).
(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 Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any 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 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
26
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)(iii) 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 party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(e) Indemnification for Reserved Securities. In connection with the offer
and sale of the Reserved Securities, the Company agrees, promptly upon a
request, in writing to indemnify and hold harmless the Underwriters from and
against any and all losses, liabilities, claims, damages and expenses incurred
by them as a result of the failure of any of the Reserved Securities
Participants to pay for and accept delivery of Reserved Securities which, by the
end of the first business day following the date of this Agreement, were subject
to a properly confirmed agreement to purchase.
SECTION 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 on the one
hand and the U.S. Underwriters on the other hand from the offering of the
Securities pursuant to this 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 on the one hand and of the U.S.
Underwriters on the other hand in connection with the statements or omissions,
or in connection with any violation of the nature referred to in Section
6(a)(ii)(A) hereof, 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 on the one hand and the U.S.
Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective
27
proportions as the total net proceeds from the offering of the U.S. Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the U.S. Underwriters, in each
case as set forth on the cover of the U.S. Prospectus, or, if Rule 434 is used,
the corresponding location on the Term Sheet, bear to the aggregate initial
public offering price of the U.S. Securities as set forth on such cover.
The relative fault of the Company on the one hand and the U.S. 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 or by the U.S. Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission or any violation of the nature referred to in Section
6(a)(ii)(A) hereof.
The Company and the U.S. 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 U.S. 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 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 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, no U.S. Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the U.S. Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
U.S. 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 0000 Xxx) 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 a U.S.
Underwriter 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 U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within
28
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 U.S. Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number of Initial U.S. Securities set forth opposite their
respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its Subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any U.S. Underwriter or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the U.S. Underwriters.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The U.S. Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the U.S. Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective 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 U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the American Stock Exchange or
the New York Stock Exchange or in the Nasdaq National Market 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 any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or (iv) if a
banking moratorium has been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, 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
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
29
SECTION 10. Default by One or More of the U.S. Underwriters. If one or more
-----------------------------------------------
of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the U.S. Representatives shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting U.S. Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the number of
U.S. Securities to be purchased on such date, each of the non-defaulting U.S.
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 U.S.
Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of U.S.
Securities to be purchased on such date, this Agreement or, with respect to any
Date of Delivery which occurs after the Closing Time, the obligation of the U.S.
Underwriters to purchase and of the Company to sell the Option Securities to be
purchased and sold on such Date of Delivery, shall terminate without liability
on the part of any non-defaulting U.S. Underwriter.
No action taken pursuant to this Section shall relieve any defaulting U.S.
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the U.S.
Underwriters to purchase and the Company to sell the relevant U.S. Option
Securities, as the case may be, either the U.S. Representatives or the Company
shall have the right to postpone the Closing Time or the relevant Date of
Delivery, as the case may be, for a period not exceeding seven days in order to
effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements. As used herein, the term "U.S. Underwriter"
includes any person substituted for a U.S. Underwriter under this Section 10.
SECTION 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. Notices to the U.S.
Underwriters shall be directed to the Representatives at Xxxxx Xxxxx, Xxxxx
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, facsimile (000) 000-0000,
attention of Xxxxx Xxxxxxx, Managing Director and Chairman; notices to the
30
Company shall be directed to it at Fox Entertainment Group, Inc., 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, XX 00000, facsimile (000) 000-0000, attention of Xxxxxx
X. Xxxxxxx, Esq., Senior Executive Vice President and General Counsel.
SECTION 12. Parties. This Agreement shall each inure to the benefit of
-------
and be binding upon the U.S. Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the U.S.
Underwriters and the Company 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 Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the U.S. Underwriters and the
Company 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 Securities
from any U.S. Underwriter shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
----------------------
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. 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.
31
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
FOX ENTERTAINMENT GROUP, INC.
By:
-------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
XXXXX & COMPANY INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
XXXXXXX XXXXX BARNEY INC.
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
--------------------------------------
Authorized Signatory
For themselves and as U.S. Representatives of the other
U.S. Underwriters named in Schedule A hereto.
32
SCHEDULE A
Name of Underwriter Number of
------------------- Initial
Securities
----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated...............................
Xxxxx & Company Incorporated...........................
Xxxxxxx, Xxxxx & Co....................................
Xxxxxx Xxxxxxx & Co. Incorporated......................
Bear, Xxxxxxx & Co. Inc................................
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation....
X.X. Xxxxxx Securities Inc.............................
NationsBanc Xxxxxxxxxx Securities LLC..................
Xxxxxxx Xxxxx Barney Inc...............................
------------
Total.................................................. 72,250,000
============
Sch A - 1
SCHEDULE B
FOX ENTERTAINMENT GROUP, INC.
72,250,000 Shares of Class A Common Stock
(Par Value $0.01 Per Share)
1. The initial public offering price of the Securities, determined as
provided in Section 2, shall be $________.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $________, being an amount equal to the initial
public offering price set forth above less $________ per share; provided that
the purchase price per share for any Option Securities purchased upon the
exercise of the over-allotment option described in Section 2(b) shall be reduced
by an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities.
Sch B - 1
SCHEDULE C
Lock-up Letters
1. The News Corporation Limited, a South Australia corporation.
Sch C - 1
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectuses and to enter into and perform its obligations under the
Purchase Agreements.
(iii) The Company 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 failure so
to qualify or to be in good standing would not result in a Material Adverse
Effect.
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectuses in the column entitled "Pro
Forma" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to the Purchase Agreements or pursuant to the
Recapitalization); the shares of issued and outstanding capital stock of
the Company have been duly authorized and validly issued and are fully paid
and non-assessable; and none of the outstanding shares of capital stock of
the Company was issued in violation of the preemptive or other similar
rights arising by operation of law, or under the charter or by-laws of the
Company, or, the best knowledge of such counsel, under any agreement to
which the Company is a party.
(v) The Securities have been duly authorized for issuance and sale to
the Underwriters pursuant to the Purchase Agreements and, when issued and
delivered by the Company pursuant to the Purchase Agreements against
payment of the consideration set forth in the Purchase Agreements, will be
validly issued and fully paid and non-assessable and no holder of the
A-1
Securities is or will be subject to personal liability by reason of being
such a holder.
(vi) The issuance of the Securities is not subject to preemptive or
other similar rights arising by operation of law, or under the charter or
by-laws of the Company or, to the best knowledge of such counsel, under any
agreement to which the Company is a party.
(vii) Each Subsidiary has been duly organized and is validly existing
as a limited liability company, corporation, general partnership or limited
partnership, as the case may be, in good standing under the laws of the
jurisdiction of its organization, has the requisite limited liability
company, corporate or partnership power, as the case may be, and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectuses and is duly qualified as a foreign limited
liability company, corporation, general partnership or limited partnership,
as the case may be, 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 failure so to qualify or to be in good standing would not result
in a Material Adverse Effect; all of the issued and outstanding capital
stock of each Subsidiary that is a corporation has been duly authorized and
validly issued, is fully paid and non-assessable; all of the limited
liability company interests and limited partnership interests in each
Subsidiary that is a limited liability company or limited partnership are
validly issued and fully paid; and except as otherwise described in the
Prospectuses and to the best knowledge of such counsel, all such shares and
interests are owned by the Company, directly or through Subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance,
claim or equity; and none of the outstanding shares of capital stock,
limited liability company interests or partnership interests of any
Subsidiary was issued in violation of the preemptive or similar rights
arising by operation of law, or under the certificate of formation, limited
liability company agreement, partnership agreement, charter, by-laws or
other organizational documents of any Subsidiary or under any agreement
filed as an exhibit to the Registration Statement.
(viii) The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
(ix) The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under the 1933 Act; any
required filing of the Prospectuses pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule 424(b); and, to
A-2
the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or threatened by the
Commission.
(x) The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the Rule 434
Information, as applicable, the Prospectuses and each amendment or
supplement to the Registration Statement and Prospectuses as of their
respective effective or issue dates (other than the financial statements
and supporting schedules included therein or omitted therefrom, as to which
such counsel need express no opinion) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(xi) If Rule 434 has been relied upon, the Prospectus was not
"materially different," as such term is used in Rule 434, from the
prospectus included in the Registration Statement at the time it became
effective.
(xii) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and by-laws
of the Company and the requirements of the New York Stock Exchange.
(xiii) To the best knowledge of such counsel, there is not pending or
threatened in writing any action, suit, proceeding, inquiry or
investigation, to which the Company or any subsidiary is a party, or to
which the property of the Company or any subsidiary is subject, before or
brought by any court or governmental agency or body, domestic or foreign,
which might reasonably be expected to result in a Material Adverse Effect,
or which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the transactions
contemplated in the Purchase Agreements or the performance by the Company
of its obligations thereunder.
(xiv) The information in the Prospectuses under "Description of
Capital Stock", "Reorganization", "Business--Properties", "Business-Legal
Proceedings", "Relationship Between the Company and News Corporation",
"Certain Arrangements Regarding the Company's Ownership of Other Entities",
"Shares Available for Future Sale", and "Certain United States Tax
Consequences to Non-United States Holders" and in the Registration
Statement under Item 14, to the extent that it constitutes matters of law,
summaries of legal matters, the Company's charter and by-laws or
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legal proceedings, or legal conclusions, has been reviewed by us and is
correct in all material respects.
(xv) To the best knowledge of such counsel, there are no statutes or
regulations that are required to be described in the Prospectus that are
not described as required.
(xvi) All descriptions in the Registration Statement of contracts and
other documents to which the Company or its subsidiaries are a party are
accurate in all material respects; to the best knowledge of such counsel,
there are no franchises, contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or referred to
in the Registration Statement or to be filed as exhibits thereto other than
those described or referred to therein or filed or incorporated by
reference as exhibits thereto, and the descriptions thereof or references
thereto are correct in all material respects.
(xvii) To the best knowledge of such counsel, neither the Company nor
any Subsidiary is in violation of its charter, by-laws, certificate of
formation, limited liability company agreement or other organizational
documents and no default by the Company or any Subsidiary exists in the due
performance or observance of any material obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument that is described
or referred to in the Registration Statement or the Prospectuses or filed
or incorporated by reference as an exhibit to the Registration Statement.
(xviii) Except as previously made or obtained, as the case may be, no
Governmental Approval (as defined below) is necessary or required in
connection with the due authorization, execution or delivery by the Company
of the Purchase Agreements, the performance by the Company of the
transactions contemplated thereby or the offering, issuance or sale of the
Securities, except such as may be required under state securities or "Blue
Sky" laws and the rules and regulations of the National Association of
Securities Dealers, Inc.. The term "Governmental Approval" means any filing
with, or authorization, approval, consent, license, order, registration,
qualification or decree of any Governmental Authority (as defined below)
pursuant to Applicable Laws (as defined below). The term "Applicable Laws"
means only those laws, rules and regulations of the State of Xxxx xxxx,
State of New York, State of California and of the United States of America
which, in such counsel's experience, are ordinarily applicable to
transactions of the type contemplated by the Purchase Agreements; provided,
however, that Applicable Laws shall not include any matter relating to
federal communications law and the rules, regulations and administrative
A-4
orders promulgated or proposed for promulgation thereunder. The term
"Governmental Authority" means any Delaware, New York, California or
federal legislative, judicial, administrative or regulatory body under
Applicable Laws.
(xix) The execution, delivery and performance of the Purchase
Agreements and the consummation of the transactions contemplated in the
Purchase Agreements and in the Registration Statement (including the
issuance and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the Prospectus under the caption
"Use Of Proceeds") and compliance by the Company with its obligations under
the Purchase Agreements do not and will not, whether with or without the
giving of notice or lapse of time or both, conflict with or constitute a
breach of, or default or Repayment Event (as defined in Section 1(a)(x) of
the Purchase Agreements) under or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company
or any Subsidiary pursuant to any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or any other agreement or
instrument, known to such counsel, to which the Company or any Subsidiary
is a party or by which it or any of them may be bound, or to which any of
the property or assets of the Company or any Subsidiary is subject (except
for such conflicts, breaches or defaults or liens, charges or encumbrances
that would not have a Material Adverse Effect), nor will such
action result in any violation of the provisions of the charter, by-laws,
certificate of formation, limited liability company agreement or other
organizational documents of the Company or any Subsidiary, or any
applicable law, statute, rule, regulation, judgment, order, writ or decree,
known to us, of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any subsidiary
or any of their respective properties, assets or operations.
(xx) Each of the Master Intercompany Agreement, the Tax Sharing
Agreement and the Indemnity Agreement (each as defined in the
Prospectuses) has been duly authorized, executed and delivered by the
Company and its Subsidiaries, as applicable, and constitutes the binding
agreement of such party, enforceable against such party in accordance with
its terms, except as the enforcement thereof may be limited by (i)
bankruptcy, insolvency (including, without limitation, all laws relating
to fraudulent transfer), reorganization, moratorium or other similar laws
relating to or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) or (ii) as to any
indemnification or contribution provision thereof, by any applicable state
or federal securities laws, rules or regulations or by public policy.
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(xxi) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
1940 Act.
Such counsel has participated in conferences with directors, officers
and other representatives of the Company, representatives of the
independent public accountants for the Company, representatives of the
Underwriters and representatives of counsel for the Underwriters, at which
conferences the contents of the Registration Statement and the Prospectus
and related matters were discussed, and, although counsel has not
independently verified and is not passing upon and assumes no
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus, nothing has come
to such counsel's attention that would lead such counsel to believe that
the Registration Statement or any amendment thereto, including the Rule
430A Information and Rule 434 Information (if applicable), at the time such
Registration Statement or any such amendment became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectuses or any amendment or supplement
thereto, at the time the Prospectuses were issued, at the time any such
amended or supplemented prospectus was issued or at the Closing Time,
contained or contains an untrue statement of a material fact or omitted or
omits 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, except that such counsel expresses no opinion or belief with
respect to the financial statements, schedules and other financial data
included therein or excluded therefrom.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper on
certificates of responsible officers of the Company and public officials.
Such opinion shall not state that it is to be governed or qualified by, or
that it is otherwise subject to, any treatise, written policy or other
document relating to legal opinions, including, without limitation, the
Legal Opinion Accord of the ABA Section of Business Law (1991).
The opinion shall relate only to the laws of the State of New York,
the corporate laws of the State of Delaware, and the federal laws of the
United States of America in force on the date thereof. The opinion is not
intended to cover and shall not cover any matter relating to federal
communications law and the rules, regulations and administrative order
promulgated or proposed for promulgation thereunder.
A-6
Exhibit B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(c)
(i) The information in the Prospectus under the captions "Risk Factors -
Regulation" and "Business - Regulation," to the extent that such information
constitutes a summary of federal communications law and the rules, regulations
and administrative orders promulgated or proposed for promulgation thereunder,
has been reviewed by such counsel and is correct in all material respects.
(ii) Except as previously made or obtained, as the case may be, no filing
or registration with, or authorization, approval, consent, license, order,
qualification or decree of the FCC is required under the Communications Act of
1934, as amended, and the rules, regulations and administrative orders
promulgated thereunder (collectively, the "Federal Communications Laws") in
connection with the execution or delivery by the Company of the Purchase
Agreements, the performance by the Company of the transactions contemplated
thereby or the offering, issuance or sale of the Securities, as applicable, all
as of the date hereof.
(iii) Except as set forth in the Prospectus, to our knowledge based
solely on a review of publicly available files of the FCC in Washington, D.C.,
neither the Company nor any of its Subsidiaries is in violation of any Federal
Communications Law or any order of any court or administrative agency or
authority relating thereto which violation would have a Material Adverse Effect.
(iv) The Company and the Subsidiaries are the holders of the main
commercial television station licenses issued by the FCC listed in Attachment A
hereto (the "FCC Licenses"), all of which are in full force and effect, with no
material conditions, restrictions or qualifications other than as described in
the Registration Statement and the Prospectus, and to our knowledge, such FCC
Licenses constitute all of the commercial television station licenses necessary
for the Company and the Subsidiaries to own their properties and to conduct
their businesses in the manner and to the full extent now operated or proposed
to be operated as described in the Prospectus.
(v) During the course of preparation of the Registration Statement and
Prospectus, we participated in certain discussions with certain officers,
employees and representatives of the Company as to FCC regulatory matters dealt
with under
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the captions "Risk Factors - Regulation" and "Business - Regulation" in the
Registration Statement and Prospectus. Although we have not undertaken to
determine independently, and we do not assume any responsibility for, the
accuracy, completeness, or fairness of the statements under such captions, we
may state on the basis of these discussions and our activities as special FCC
counsel to the Company in connection with the Registration Statement and
Prospectus that no facts have come to our attention that cause us to believe
that there are any FCC orders, decrees or rulings outstanding against the
Company or any of its Subsidiaries or any pending or threatened actions, suits
or proceedings against the Company or any of its Subsidiaries by or before the
FCC that seek to revoke, or if determined adversely to the Company or any of
its Subsidiaries, would result in a revocation or non-renewal of, any of the FCC
Licenses, other than as disclosed in the Registration Statement or Prospectus.
B-2
Exhibit C
FORM OF LOCK-UP LETTER
, 1998
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
XXXXX & COMPANY INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
XXXXXXX XXXXX BARNEY INC.
As Representatives of the several Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Fox Entertainment Group, Inc.
-----------------------------
Ladies and Gentlemen:
As of the closing of the Offering referred to below, the undersigned
will be the beneficial owner of _____ shares of Class A Common Stock, par value
$.01 per share (the "Class A Common Stock") and _____ shares of Class B Common
Stock, par value $.01 per share (the "Class B Common Stock" and, together with
the Class A Common Stock, the "Common Stock") of Fox Entertainment Group, Inc.
(the "Company"), a Delaware corporation. The undersigned understands that the
Company has filed a Registration Statement on Form S-1 (the "Registration
Statement") with the Securities and Exchange Commission for the registration of
an
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aggregate offering price of approximately $ 2,340,000,000 of shares of Class A
Common Stock (which includes the aggregate offering price of shares subject to
an over-allotment option) (the "Offering"). The undersigned further understands
that you are contemplating entering into a U.S. Purchase Agreement and an
International Purchase Agreement (together, the "Purchase Agreements") with the
Company in connection with the Offering. All terms not otherwise defined herein
shall have the same meanings as in the Purchase Agreements.
In recognition of the benefit that such the Offering will confer upon the
undersigned as a stockholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the Purchase Agreements
(the "Underwriters") that, during a period of 180 days from the date of the
Purchase Agreements, the undersigned will not, without the prior written consent
of Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx Incorporated directly or indirectly, (i)
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant for
the sale of, or otherwise dispose of or transfer (or announce any offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant for the sale of,
or other disposition of or transfer of) any shares of the Company's Common Stock
or any securities convertible into or exchangeable or exercisable for Common
Stock, whether now owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires beneficial ownership
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) or the power of disposition, or file any registration statement under
the Securities Act of 1933, as amended, with respect to any of the foregoing or
(ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap transaction is to be
settled by delivery of Common Stock or other securities, in cash or otherwise.
C-2
The undersigned, whether or not participating in the offering,
confirms that he, she or it understands that the Underwriters and the Company
will rely upon the representations set forth in this agreement in proceeding
with the Offering. This agreement shall be binding on the undersigned and his,
her or its respective successors, heirs, personal representatives and assigns.
Very truly yours,
-----------------------------
Name:
The foregoing is accepted and agreed to
as of the date first above written:
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
XXXXX & COMPANY INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
X.X. XXXXXX SECURITIES INC.
NATIONSBANC XXXXXXXXXX SECURITIES LLC
XXXXXXX XXXXX BARNEY INC.
By:
------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters.
C-3
