Underwriting Agreement
Class
A Shares
_______________,
2007
Xxxxxxx,
Xxxxx & Co.
00 Xxxxx
Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Xxxxxx
Brothers Inc.
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
As
representatives of the several Underwriters named in
Schedule I hereto,
Ladies
and Gentlemen:
Fortress
Investment Group LLC, a Delaware limited liability company (the
“Company”), proposes, subject to the terms and conditions stated
herein, to issue and sell to Xxxxxxx, Xxxxx & Co. and Xxxxxx Brothers Inc.
as representatives (the “Representatives”) of the several
underwriters listed in Schedule I hereto (the “Underwriters”), an
aggregate of 34,286,000 shares (the “Firm Shares”) and, at the
election of the Underwriters, up to 5,142,900 additional shares (the
“Optional Shares”) of Class A shares representing Class A limited
liability company interests (“Class A Shares”) of the Company (the
Firm Shares and the Optional Shares that the Underwriters elect to purchase
pursuant to Section 2 hereof being collectively called the
“Shares”).
It is
understood that approximately 3,428,600 of the Firm Shares (the “Directed
Shares”) will initially be reserved by the several Underwriters for offer
and sale upon the terms and conditions set forth in the Prospectus and in
accordance with the rules and regulations of the National Association of
Securities Dealers, Inc. (the “NASD”) to employees of the Company and
its subsidiaries and persons having business relationships with the Company and
its subsidiaries (collectively, “Participants”) who have heretofore
delivered to Deutsche Bank Securities Inc. and Xxxxxx Brothers Inc.
(collectively in such capacity, the “DSP Managers” and, each, in such
capacity, a “DSP Manager”) offers or indications of interest to
purchase Firm Shares in form satisfactory to a DSP Manager (such program, the
“Directed Share Program”) and that any allocation of such Firm Shares
among such Participants will be made in accordance
with
timely directions received by the DSP Managers from the Company; provided, that
under no circumstances will the DSP Managers or any Underwriter be liable to
the Company or to any such Participants for any action taken or omitted in good
faith in connection with such Directed Share Program. It is further understood
that any Firm Shares which are not affirmatively reconfirmed for purchase by
any participant in the Directed Share Program by 10:00 A.M. New York City time
on the first business day following the date hereof or otherwise not purchased
by such Participants will be offered by the Underwriters to the public upon the
terms and conditions set forth in the Prospectus.
The
Company agrees to pay all fees and disbursements incurred by the Underwriters
in connection with the Directed Share Program and any stamp duties or other
taxes incurred by the Underwriters in connection with the Directed Share
Program.
1. The
Company represents and warrants to, and agrees with, each of the Underwriters
that:
(a) A
registration statement on Form S-1 (File No. 333-138514) (the “Initial
Registration Statement”) in respect of the Shares has been filed with the
Securities and Exchange Commission (the “Commission”); the Initial
Registration Statement and any post effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits thereto, to you for
each of the other Underwriters, have been declared effective by the Commission
in such form; other than a registration statement, if any, increasing the size
of the offering (a “Rule 462(b) Registration Statement”), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
“Act”), which became effective upon filing, no other document with
respect to the Initial Registration Statement has heretofore been filed with
the Commission; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, is hereinafter called a “Preliminary
Prospectus”; the various parts of the Initial Registration Statement and
the Rule 462(b) Registration Statement, if any, including all exhibits thereto
and including the information contained in the form of final prospectus filed
with the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to be part
of the Initial Registration Statement at the time it was declared effective,
each as amended at the time such part of the Initial Registration Statement
became effective or such part of the Rule 462(b) Registration Statement, if
any, became or hereafter becomes effective, are hereinafter collectively called
the “Registration Statement”; the Preliminary Prospectus relating to
the Shares that was included in the Registration Statement immediately prior to
the Applicable Time (as defined in Section 1(c) hereof) is hereinafter called
the “Pricing Prospectus”; such final prospectus, in the form first
filed pursuant to Rule 424(b) under the Act, is hereinafter called the
“Prospectus”; and any “issuer free writing prospectus”
as
defined in Rule 433 under the Act relating to the Shares is hereinafter called
an “Issuer Free Writing Prospectus”);
(b) No order
preventing or suspending the use of any Preliminary Prospectus or any Issuer
Free Writing Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects
to the requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided,
however, that
this representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through the Representatives expressly for use
therein;
(c) For the
purposes of this Agreement, the “Applicable Time” is [•]
[a][p].m. (Eastern time) on the date of this Agreement. The Pricing Prospectus,
when taken together with the pricing information set forth on Schedule III(b)
hereto, as of the Applicable Time, did not include any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and each Issuer Free Writing Prospectus listed on
Schedule III(a) hereto does not conflict with the information contained in
the Registration Statement, the Pricing Prospectus or the Prospectus and each
such Issuer Free Writing Prospectus, as supplemented by and taken together with
the Pricing Prospectus as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements or omissions made in
an Issuer Free Writing Prospectus in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through the
Representatives expressly for use therein;
(d) The
Registration Statement conforms, and the Prospectus and any further amendments
or supplements to the Registration Statement and the Prospectus will conform,
in all material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder and do not and will not, as of the
applicable effective date as to each part of the Registration Statement and as
of the applicable filing date as to the Prospectus and any amendment or
supplement thereto, 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; provided,
however, that
this representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through the Representatives expressly for use
therein;
(e) Neither
the Company nor any of its direct or indirect subsidiaries, including, without
limitation, each of the Operating Group entities set forth on Schedule II
hereto (collectively, the “Fortress Operating Group”) but not
including funds managed
by
subsidiaries of the Company or entities controlled by the funds of the Company
(the “Subsidiaries”) has sustained since the date of the latest
audited financial statements included in the Pricing Prospectus any material
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Pricing Prospectus; since the respective dates as of which
information is given in the Registration Statement and the Pricing Prospectus,
there has not been any change in the capital stock or long-term debt of the
Company or any of its Subsidiaries or any material adverse change, or any
development involving a prospective material adverse change in, or affect on,
the general affairs, management, current or future financial position,
members’ equity or results of operations, as applicable, of the Company
and its Subsidiaries, taken as a whole (a “Material Adverse Effect”),
otherwise than as set forth or contemplated in the Pricing
Prospectus;
(f) The
Company and its Subsidiaries have good and marketable title in fee simple to
all real property and good and marketable title to all personal property owned
by them, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Pricing Prospectus or such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
Subsidiaries, respectively; and any real property and buildings held under
lease by the Company and its Subsidiaries are held by them under valid,
subsisting and enforceable leases, except where the failure to do so would not,
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect;
(g) The
Company has been duly organized and is validly existing as a limited liability
company in good standing under the laws of the State of Delaware, with power
and authority (corporate and other) to own its properties and conduct its
business as described in the Pricing Prospectus, and has been duly qualified as
a foreign limited liability company for the transaction of business and is in
good standing as a foreign limited liability company under the laws of each
other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, except to the extent that the
failure to be so qualified would not, individually or in the aggregate, result
in a Material Adverse Effect; each of the Subsidiaries and the Fortress Funds
has been duly organized and is validly existing in good standing under the laws
of its jurisdiction of organization, with power and authority (corporate and
other) to own its properties and conduct its business as described in the
Pricing Prospectus, and has been duly qualified for the transaction of business
and is in good standing under the laws of each other jurisdiction in which it
owns or leases properties or conducts any business so as to require such
qualification except to the extent that the failure to be so qualified would
not, individually or in the aggregate, result in a Material Adverse Effect.
“Fortress Funds” means, collectively, all Funds (i) sponsored or
promoted by any of the Company’s Subsidiaries, (ii) for which any of the
Company’s Subsidiaries acts as a general partner or managing member (or in
a similar capacity) or (iii) for which any of the Company’s Subsidiaries
acts as an investment adviser or investment manager (other than (x) any Fund
that is sub-advised by the Company’s Subsidiaries (or for which the
Company’s Subsidiaries have primary investment responsibility over only a
minority
of the investment portfolio and/or are not primarily responsible for periodic
reporting and filings) and for which an unaffiliated third-party acts as the
promoter and sponsor, (y) any entity which is a subsidiary of a Fortress Fund
(other than the Fortress Capital Finance Subsidiaries) and (z) any
securitization vehicle used by a Fortress Fund for financing purposes, such as
a collateralized debt obligation entity, for which a Company’s Subsidiary
acts in either of the capacities identified in clauses (i) or (ii) above or
this clause (iii)); and "Fund" means any collective investment vehicle (whether
open-ended or closed-ended) including, without limitation, an investment
company, a general and limited partnership, a trust and a company organized in
any jurisdiction. “Fortress Capital Finance Subsidiaries” means
Fortress Capital Finance LLC, Fortress Capital Finance II LLC, Fortress Capital
Finance III (A) LLC, Fortress Capital Finance III (B) LLC, Fortress Capital
Finance III (C) LLC, Fortress Capital Finance III (D) LLC, Fortress Capital
Finance III (E) LLC, Fortress Capital Finance III (CIF-A) LLC, Fortress Capital
Finance III (CIF-B) LLC, Fortress Capital Finance III (CIF-C) LLC and Fortress
Capital Finance III (CIF-D) LLC ;
(h) The
Company has an authorized capitalization as set forth in the Pricing Prospectus
and all of the issued Shares of the Company will have been duly and validly
authorized and issued and upon payment in full of the
consideration payable with respect to the Shares, as determined by
the Board of Directors of the Company, the holders of such Shares shall not be
liable to the Company to make any additional capital contributions with respect
to such Shares (except as otherwise required by Sections 18-607 and 18-804 of
the Delaware Limited Liability Company Act); and will conform to the
description of the Shares contained in the Pricing Prospectus and Prospectus;
all of the issued capital stock or other equity interest of each of the
Company’s subsidiaries that is a “significant subsidiary” (as
defined in Rule 405 of the Securities Act) (collectively, the “Significant
Subsidiaries”) have been duly and validly authorized and issued and, in
the case of any entities that are organized as corporations, are fully paid and
non-assessable and, in the case of any entities that are organized as limited
liability companies, the Company is not liable to such entity to make any
additional capital contributions with respect to its equity interest in such
entity (except as otherwise required by Sections 18-607 and 18-804 of the
Delaware Limited Liability Company Act), and except for interests held by
employees in entities which function as investment managers or general partners
of particular Fortress Funds and which, with respect to the percentage of such
interests held by employees as of the date of any historical balance sheet
contained in the financial statements included in the Pricing Prospectus, are
reflected in non-controlling interests in consolidated subsidiaries on such
balance sheets, are owned directly or indirectly by the Company, free and clear
of all liens, encumbrances, equities or claims; and all of the interests in
each Significant Subsidiary organized as a partnership have been duly and
validly created and except for interests held by employees in entities which
function as investment managers or general partners of particular Fortress
Funds and which, with respect to the percentage of such interests held by
employees as of the date of any historical balance sheet contained in the
financial statements included in the Pricing Prospectus, are reflected in
non-controlling interests in consolidated subsidiaries on such balance sheets,
are owned directly or indirectly by the Company;
(i) The
issue and sale of the Shares and the compliance by the Company with this
Agreement and the consummation of the transactions herein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, (x) any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the Company
or any of its Subsidiaries or any of the Fortress Funds is a party or by which
the Company or any of its Subsidiaries or any of the Fortress Funds is bound or
to which any of the property or assets of the Company or any of its
Subsidiaries or any of the Fortress Funds is subject, nor will such action
result in any violation of the provisions of (y) the Amended and Restated
Certificate of Formation (“Certificate of Formation”) or the Amended
and Restated Limited Liability Company Agreement (“LLC Agreement”) of
the Company or the organizational documents of any of its Subsidiaries or (z)
any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or its Subsidiaries or any
of their properties, except in the case of clauses (x) and (z) for such
conflicts, breaches, defaults or violations that would not, individually or in
the aggregate, result in a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any such court
or governmental agency or body is required for the issue and sale of the Shares
or the consummation by the Company of the transactions contemplated by this
Agreement, except the registration under the Act of the Shares and such
consents, approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters;
(j) None of
the Company, the Subsidiaries or the Fortress Funds is (x) in violation of its
certificate of incorporation, bylaws, limited liability company agreement or
partnership agreement, as applicable, or (y) in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may
be bound, except in the case of clause (y) for such violations or defaults that
would not, individually or in the aggregate, result in a Material Adverse
Effect;
(k) The
statements set forth in the Pricing Prospectus and the Prospectus under the
caption “Description of Shares”, insofar as they purport to
constitute a summary of the terms of the Class A Shares and under the
captions
“Certain Relationships and Related Party Transactions―Shareholder
Agreement”, “Certain Relationships and Related Party
Transactions―Tax Receivable Agreement”, “Agreement Among
Principals”, “Description of Indebtedness”, “Material U.S.
Federal Tax Considerations”
and “Underwriting”, insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate,
complete and fair;
(l) Other
than as set forth in the Pricing Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its Subsidiaries or any of
the Fortress Funds is a party or of which any property of the Company or any of
the Subsidiaries or any of the Fortress Funds is the subject which, if
determined
adversely
to the Company or any of the Subsidiaries or any of the Fortress Funds, would
individually or in the aggregate, have a Material Adverse Effect; and, to the
best knowledge of the Company, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(m) The
Company is not and, after giving effect to the offering and sale of the Shares
and the application of the proceeds thereof, will not be an “investment
company”, as such term is defined in the Investment Company Act of 1940,
as amended (the “Investment Company Act”);
(n) At the
time of filing the Initial Registration Statement the Company was not and is
not an “ineligible issuer,” as defined in Rule 405 under the Act;
(o) Ernst
& Young LLP, who have certified certain financial statements of the Company
and its subsidiaries, is an independent registered public accounting firm with
respect to the Company and its subsidiaries within the applicable rules and
regulations adopted by the Commission and the Public Accounting Oversight Board
(United States) and as required by the Act;
(p) Except
as disclosed in the Pricing Prospectus, the Company (individually and on a
consolidated basis) and its subsidiaries maintain systems of “internal
control over financial reporting” (as such term is defined in Rule
13a-15(f) under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) sufficient to provide reasonable assurance that: (i)
transactions are executed in accordance with management’s general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with U.S. generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management’s general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(q) Since
the date of the latest audited financial statements included in the Pricing
Prospectus, there has been no change in the Company’s internal control
over financial reporting that has materially affected, or is reasonably likely
to materially adversely affect the Company’s internal control over
financial reporting;
(r) All tax
returns required to be filed by the Company, the Subsidiaries and the Fortress
Funds in all jurisdictions have been timely and duly filed, other than those
filings being contested in good faith and except where the failure to file
would not, individually or in the aggregate, have a Material Adverse Effect.
There are no tax returns of the Company, the Subsidiaries and the Fortress
Funds that are currently being audited by state, local or federal taxing
authorities or agencies (and with respect to which the Company, the
Subsidiaries or the Fortress Funds has received notice), where the findings of
such audit would not reasonably be expected to result in a Material Adverse
Effect. All taxes, including withholding taxes, penalties and interest,
assessments, fees and other charges due or claimed to be due from such
entities, have
been
paid, other than those being contested in good faith and for which adequate
reserves have been provided or those currently payable without penalty or
interest or those that would not reasonably be expected to result in a Material
Adverse Effect;
(s) Except
as disclosed in the Pricing Prospectus and the Prospectus, each of the Company
and its Subsidiaries maintains insurance covering its properties, operations,
personnel and businesses which insures against such losses and risks as are
adequate in accordance with its reasonable business judgment to protect the
Company and its Subsidiaries and their businesses;
(t) Except
as disclosed in the Pricing Prospectus and the Prospectus, there are no
material business relationships or related party transactions which would be
required to be disclosed therein by Item 404 of Regulation S-K of the
Commission and such business relationship or related party transaction
described therein is a fair and accurate description in all material respects
of the relationships and transactions so described;
(u) Each
employee benefit plan, within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), that is
maintained, administered or contributed to by the Company or any of its
affiliates, that together with the Company would be deemed a “single
employer” within the meaning of Section 4001(b)(1) of ERISA (“ERISA
Affiliates”) for employees or former employees of the Company and its
ERISA Affiliates has been maintained in compliance in all material respects
with its terms and the requirements of any applicable statutes, orders, rules
and regulations, including but not limited to ERISA and the Internal Revenue
Code of 1986, as amended (the “Code”); no prohibited transaction,
within the meaning of Section 406 of ERISA or Section 4975 of the Code, for
which the Company or any of its ERISA Affiliates would have any material
liability has occurred with respect to any such plan excluding transactions
effected pursuant to a statutory or administrative exemption; for each such
plan that is subject to the funding rules of Section 412 of the Code or Section
302 of ERISA, no “accumulated funding deficiency” as defined in
Section 412 of the Code has been incurred, whether or not waived, and the fair
market value of the assets of each such plan (excluding for these purposes
accrued but unpaid contributions) exceeds the present value of all benefits
accrued under such plan determined using reasonable actuarial assumptions; no
“reportable event” (as defined in ERISA) has occurred with respect to
any “pension plan” (as defined in ERISA) for which the Company or any
of its ERISA Affiliates would have any material liability; and neither the
Company nor any of its ERISA Affiliates has incurred or reasonably expects to
incur any material liability under Title IV of ERISA with respect to
termination of, or withdrawal from, any “pension plan”;
(v) The
Company is not required to be registered, licensed or qualified as an
investment adviser or a broker-dealer or as a commodity trading advisor, a
commodity pool operator or a futures commission merchant or any or all of the
foregoing, as applicable; each of the Subsidiaries that is required to be
registered, licensed or qualified as an investment adviser or a broker-dealer
or as a commodity trading advisor, a commodity pool operator or a futures
commission merchant or any or
all of
the foregoing, as applicable, is so registered, licensed or qualified in each
jurisdiction where the conduct of its business requires such registration,
license or qualification (and such registration, license or qualification is in
full force and effect), and is in compliance with all applicable laws requiring
any such registration, licensing or qualification, except as set forth in or
contemplated in the Pricing Prospectus and where the failure to be so
registered, licensed or qualified would not, individually or in the aggregate,
result in a Material Adverse Effect; each of the Subsidiaries that is required
to be registered as an investment adviser under the Investment Advisers Act of
1940, as amended (the “Advisers Act”) has adopted a written
compliance program reasonably designed to ensure compliance with the Advisers
Act and has appointed a chief compliance officer, except where the failure to
do so would not, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect;
(w) The
Company is not a party to any investment advisory agreement; each investment
advisory agreement to which any of the Subsidiaries is a party is a valid and
legally binding obligation of the Subsidiaries and in compliance with the
applicable provisions of the Advisers Act, except as have not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, and none of the Subsidiaries is in breach or violation of or in
default under any such agreement which breach, violation, default or invalidity
has not had and would not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, except as set forth in or
contemplated in the Pricing Prospectus (exclusive of any supplement
thereto);
(x) The
Company does not advise any of the Fortress Funds; (i) each of the Fortress
Funds which is required to be registered with the Commission as an investment
company under the Investment Company Act is duly registered with the Commission
as an investment company under the Investment Company Act, and (ii) each such
Fortress Fund has adopted a written compliance program reasonably designed to
ensure compliance with Federal Securities Laws (as defined below), including
policies and procedures that provide for the oversight of compliance by each
investment adviser, principal underwriter, administrator and transfer agent of
the Fortress Fund, and has appointed a chief compliance officer except, with
respect to each of (i) and (ii), for such failure to be so registered or to
have adopted such programs as would not have, individually or in the aggregate,
a Material Adverse Effect. “Federal Securities Laws” shall mean the
Investment Company Act, the Advisers Act, the Act, the Exchange Act, the
Xxxxxxxx-Xxxxx Act of 2002, Title V of the Xxxxx-Xxxxx Bliley Act and the rules
adopted by the Commission thereunder, as well as certain applicable provisions
under the Bank Secrecy Act and any rules adopted thereunder by the Commission
or the Department of the Treasury;
(y) Consummation
of the transactions contemplated by this Agreement, including each of the
“Transactions” (as such term is defined in the Registration
Statement) disclosed in the Section of the Prospectus captioned “Our
Structure - The Transactions”, will not constitute an
“assignment” within the meaning of such term under the Investment
Company Act (and the rules and regulations thereunder) or the Advisers Act (and
the rules and regulations thereunder) of any of the
investment
advisory contracts to which any of the Subsidiaries is a party; nor will
consummation of such transactions adversely affect in any material respect the
ability of the Company and its Subsidiaries to conduct their respective
businesses in compliance with applicable law as described in the Pricing
Prospectus and the Prospectus, including, but not limited to, providing
investment advisory services to clients and funds, whether or not such funds
are registered under the Investment Company Act;
(z) None of
the Company, any of its Subsidiaries or the Fortress Funds, or, to the
knowledge of the Company, no director, officer, agent, employee or other person
associated with or acting on behalf of the Company, any of its Subsidiaries or
the Fortress Funds, has violated or is in violation of any provision of the
U.S. Foreign Corrupt Practices Act of 1977; or made any unlawful bribe, rebate,
payoff, influence payment, kickback or other unlawful payment;
(aa) The
operations of the Company, the Subsidiaries and the Fortress Funds are and have
been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering statutes
of all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any governmental agency (collectively, the “Money Laundering Laws”)
and no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company, the
Subsidiaries or the Fortress Funds with respect to the Money Laundering Laws is
pending or, to the knowledge of the Company, threatened, except as would not,
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect;
(bb) To the
best of the Company’s knowledge, none of the Company, the Subsidiaries,
the Fortress Funds or any of their respective affiliates does business with any
court, administrative agency, regulatory body, commission or other governmental
authority, board, bureau or instrumentality, domestic or foreign and any
subdivision thereof, or with any individual, corporation, firm, partnership,
joint venture, limited liability company, estate, trust, business association,
organization or other entity located in, any country targeted by any of the
economic sanctions, programs or similar sanctions-related measures of the
United States as administered by the Office of Foreign Assets Control of the
U.S. Treasury Department (“OFAC”); and the Company will not directly
or indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to the Subsidiaries, the Fortress Funds
or any joint venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any U.S. sanctions
administered by OFAC;
(cc) The
Company has duly authorized and, by the First Time of Delivery (as defined in
Section 4 hereof) shall have executed and delivered, the Shareholders’
Agreement, the Expense Allocation Agreement, the Tax Receivable Agreement and
each Employment, Non-Competition and Non-Solicitation Agreement (each such
capitalized term as described in the Pricing Prospectus under “Our
Structure – The Transactions”); each of the Shareholders’
Agreement, the Expense Allocation
Agreement
and the Tax Receivable Agreement is a valid and legally binding agreement of
the Company enforceable in accordance with its terms, subject as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors rights and to general equity principles; and the Company has obtained
the signature of each other party to each Employment, Non-Competition and
Non-Solicitation Agreement; provided,
however, that
the Company makes no representation or warranty as to the authorization,
execution or delivery of any such agreement by any other party
thereto;
(dd) None of
the Subsidiaries which act as a general partner or managing member (or in a
similar capacity) or as an investment adviser or investment manager of any
Fortress Fund has performed any act or otherwise engaged in any conduct that
would prevent such Subsidiary from benefiting from any exculpation clause or
other limitation of liability available to it under the terms of the management
agreement or advisory agreement, as applicable, between such Subsidiary and
Fortress Fund except, in each case, as would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse
Effect;
(ee) Except
as disclosed in the Pricing Prospectus, there are no contracts, agreements or
understandings between the Company or its Subsidiaries and any person granting
such person the right to require the Company to file a registration statement
under the Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such securities in
the securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement filed
by the Company under the Act;
(ff) The
Company solely determined, without any direct or indirect participation by the
Underwriters, the Participants who will purchase Directed Shares (including the
amounts to be purchased by such persons) sold in the offering by the
Underwriters pursuant to the Directed Share Program; and
(gg) The
Registration Statement, the Pricing Prospectus and the Prospectus comply, and
any further amendments or supplements thereto will comply, in all material
respects, with any applicable laws or regulations of each jurisdiction in which
the Pricing Prospectus or the Prospectus, as amended or supplemented, if
applicable, is distributed in connection with the Directed Share Program, and
no authorization, approval, consent, license, order, registration or
qualification of or with any court or governmental or regulatory authority,
other than such as have been obtained or will be obtained or completed by the
First Time of Delivery (as defined in Section 4 hereof), is necessary under the
securities laws and regulations of any such jurisdiction. Neither the Company
nor its Subsidiaries has offered, or caused the Underwriters to offer, Shares
to any person pursuant to the Directed Share Program with the specific intent
to unlawfully influence (i) a customer or supplier of the Company to alter the
customer’s or supplier’s level or type of business with the Company
or (ii) a trade journalist or publication to write or publish favorable
information about the Company or its products.
2. Subject
to the terms and conditions herein set forth, (a) the Company agrees to issue
and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at a purchase price
per share of $[•], the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto and (b) in the event and to the extent that the Underwriters
shall exercise the election to purchase Optional Shares as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at the purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares
provided that the total number of shares subject to such election shall not be
reduced by such adjustment) determined by multiplying such number of Optional
Shares by a fraction, the numerator of which is the maximum number of Optional
Shares which such Underwriter is entitled to purchase as set forth opposite the
name of such Underwriter in Schedule I hereto and the denominator of which is
the maximum number of Optional Shares that all of the Underwriters are entitled
to purchase hereunder.
The
Company hereby grants to the Underwriters the right to purchase at their
election up to 3,428,600 Optional Shares, at the purchase price per share set
forth in the paragraph above, for the sole purpose of covering sales of shares
in excess of the number of Firm Shares, provided that the purchase price per
Optional Share shall be reduced by an amount per share equal to any dividends
or distributions declared by the Company and payable on the Firm Shares but not
payable on the Optional Shares. Any such election to purchase Optional Shares
may be exercised only by written notice from you to the Company, given within a
period of 30 calendar days after the date of this Agreement, setting forth the
aggregate number of Optional Shares to be purchased and the date on which such
Optional Shares are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or
later than ten business days after the date of such notice.
3. Upon the
authorization by you of the release of the Firm Shares, the several
Underwriters propose to offer the Firm Shares for sale upon the terms and
conditions set forth in the Prospectus.
4.
(a) The
Shares to be purchased by each Underwriter hereunder, in definitive form, and
in such authorized denominations and registered in such names as the
Representatives may request upon at least forty-eight hours’ prior notice
to the Company shall be delivered by or on behalf of the Company to the
Representatives, through the facilities of the Depository Trust Company
(“DTC”), for the account of such Underwriter, against payment by or
on behalf of such Underwriter of the purchase price therefor by wire transfer
of Federal (same-day) funds to the account specified by the Company to the
Representatives at least forty-eight hours in advance. The Company will cause
the certificates representing the Shares to be made available for checking and
packaging at least twenty-four hours prior to the Time of Delivery (as defined
below) with respect thereto at the office of DTC or its designated custodian
(the
“Designated
Office”). The time and date of such delivery and payment shall be, with
respect to the Firm Shares, 9:30 a.m., New York City time, on [•], 2007 or
such other time and date as Xxxxxxx, Xxxxx & Co. and the Company may agree
upon in writing, and, with respect to the Optional Shares, 9:30 a.m., New York
time, on the date specified by the Representatives in the written notice given
by the Representatives of the Underwriters’ election to purchase such
Optional Shares, or such other time and date as the Representatives and the
Company may agree upon in writing. Such time and date for delivery of the Firm
Shares is herein called the “First Time of Delivery”, such time and
date for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the “Second Time of Delivery”, and each such time and
date for delivery is herein called a “Time of Delivery”.
(b) The
documents to be delivered at each Time of Delivery by or on behalf of the
parties hereto pursuant to Section 8 hereof, including the cross receipt for
the Shares and any additional documents requested by the Underwriters pursuant
to Section 8(k) hereof, will be delivered at the offices of Sidley Austin
llp, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the “Closing Location”),
and the Shares will be delivered at the Designated Office, all at such Time of
Delivery. A meeting will be held at the Closing Location at [•] p.m., New
York City time, on the New York Business Day (as defined below) next preceding
such Time of Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for review by
the parties hereto. For the purposes of this Section 4, “New York Business
Day” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which
is not a day on which banking institutions in New York City are generally
authorized or obligated by law or executive order to close.
5. The
Company agrees with each of the Underwriters:
(a) To
prepare the Prospectus in a form approved by you and to file such Prospectus
pursuant to Rule 424(b) under the Act not later than the Commission’s
close of business on the second business day following the execution and
delivery of this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or the Prospectus prior to the last
Time of Delivery which shall be disapproved by you promptly after reasonable
notice thereof; to advise you, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement has been filed or
becomes effective or any amendment or supplement to the Prospectus has been
filed and to furnish you with copies thereof; to file promptly all material
required to be filed by the Company with the Commission pursuant to Rule 433(d)
under the Act; to advise you, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other prospectus in respect
of the Shares, of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or
for additional information; and, in the event of the issuance of any stop order
or of any order preventing or suspending the use of any
Preliminary
Prospectus
or other prospectus or suspending any such qualification, to promptly use its
best efforts to obtain the withdrawal of such order;
(b) Promptly
from time to time to take such action as you may reasonably request to qualify
the Shares for offering and sale under the securities laws of such
jurisdictions as you may reasonably request and to comply with such laws so as
to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be required to
qualify as a foreign limited liability company or to file a general consent to
service of process in any jurisdiction.
(c) In
connection with the Directed Share Program, to ensure that the Directed Shares
will be restricted from sale, transfer, assignment, pledge or hypothecation to
the same extent as sales and dispositions of the Shares by the Company are
restricted pursuant to Section 5(f) hereof, and the DSP Managers will notify
the Company as to which Directed Share Participants will need to be so
restricted. At the request of a DSP Manager, the Company will direct the
transfer agent to place stop transfer restrictions upon such securities for
such period of time. Furthermore, the Company covenants with the Underwriters
that the Company will comply in all material respects with all applicable U.S.
securities and other applicable laws, rules and regulations in each
jurisdiction in which the Directed Shares are offered in connection with the
Directed Share Program;
(d) Prior to
10:00 a.m., New York City time, on the New York Business Day next succeeding
the date of this Agreement and from time to time, to furnish the Underwriters
with written and electronic copies of the Prospectus in New York City in such
quantities as you may reasonably request, and, if the delivery of a prospectus
(or in lieu thereof, the notice referred to in Rule 173(a) under the Act) is
required at any time prior to the expiration of nine months after the time of
issue of the Prospectus in connection with the offering or sale of the Shares
and if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement the
Prospectus in order to comply with the Act, to notify you and upon your request
to prepare and furnish without charge to each Underwriter and to any dealer in
securities as many written and electronic copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such compliance; and in
case any Underwriter is required to deliver a prospectus (or in lieu thereof,
the notice referred to in Rule 173(a) under the Act) in connection with sales
of any of the Shares at any time nine months or more after the time of issue of
the Prospectus, upon your request but at the expense of such Underwriter, to
prepare and deliver to such Underwriter as many written and electronic copies
as you may request of an amended or supplemented Prospectus complying with
Section 10(a)(3) of the Act;
(e) To make
generally available to its securityholders as soon as practicable, but in any
event not later than sixteen months after the effective date of the
Registration Statement (as defined in Rule 158(c) under the Act), an earnings
statement of the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company, Rule
158);
(f) During
the period beginning from the date hereof and continuing to and including the
date 120 days after the date of the Prospectus (the “Lock-Up
Period”), the Company shall not, and shall not permit its Subsidiaries or
the Fortress Funds, to offer, sell, contract to sell, pledge, grant any option
to purchase, make any short sale or otherwise dispose, except as provided
hereunder, of any securities of the Company that are substantially similar to
the Shares, including but not limited to any options or warrants to purchase
Class A Shares or any securities that are convertible into or exchangeable for,
or that represent the right to receive, Class A Shares or any such
substantially similar securities without your prior written consent (other than
(A) the grant of awards pursuant to employee benefit plans or arrangements
described in the Prospectus or approved by the Company’s shareholders
after the date hereof, including in connection with the settlement of
restricted share units, (B) upon the exercise of an option or upon conversion
or exchange of convertible or exchangeable securities disclosed in the
Prospectus, (C) the issuance of securities to be registered pursuant to any
registration statement on Form S-8 pursuant to any benefit plans or
arrangements disclosed in the Prospectus or approved by the Company’s
shareholders after the date hereof and (D) the issuance of Class A Shares in
connection with the acquisition of the assets of, or a significant portion of
the equity of, or a joint venture with, another entity, provided, however that
(i) the aggregate number of shares so issued shall not exceed 20% of the number
of shares or any securities of the Company that are substantially similar to
the shares, included but not limited to any securities that are convertible
into or exchangeable for, or that represent the right to receive Class A
Shares, outstanding immediately following the offering and sale of the Shares
in accordance with this Agreement and (ii) prior to the issuance of such
shares, each recipient of such shares shall agree in writing with you, in an
agreement in the form to be agreed to by the Representatives, not to sell,
offer, dispose or otherwise transfer any such shares or options during the
Lock-Up Period); provided,
however, that if
(1) during the last 17 days of the initial Lock-Up Period, the Company releases
earnings results or announces material news or a material event or (2) prior to
the expiration of the initial Lock-Up Period, the Company announces that it
will release earnings results during the 15-day period following the last day
of the initial Lock-Up Period, then in each case the Lock-Up Period will be
automatically extended until the expiration of the 18-day period beginning on
the date of release of the earnings results or the announcement of the material
news or material event, as applicable, unless the Representatives waive, in
writing, such extension; the Company will provide the Representatives and each
person subject to the Lock-Up Period pursuant to the lockup letters described
in Section 8(i) with prior notice of any such announcement that gives rise to
an extension of the Lock-Up Period;
(g) Unless
otherwise publicly available in electronic format on the website of the Company
or the Commission, to furnish to its shareholders as soon as
practicable
after the end of each fiscal year an annual report (including a balance sheet
and statements of income, members’ equity and cash flows of the Company
and its consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three quarters
of each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to its
shareholders consolidated summary financial information of the Company and its
subsidiaries for such quarter in reasonable detail;
(h) During a
period of three years from the effective date of the Registration Statement, to
furnish to you copies of all reports or other communications (financial or
other) furnished to shareholders, and to deliver to you (i) as soon as they are
available, copies of any reports and financial statements furnished to or filed
with the Commission or any national securities exchange on which any class of
securities of the Company is listed, other than such reports and financial
statements that are publicly available on the Commission’s XXXXX system;
and (ii) such additional information concerning the business and financial
condition of the Company as you may from time to time reasonably request (such
financial statements to be on a consolidated basis to the extent the accounts
of the Company and its subsidiaries are consolidated in reports furnished to
its shareholders generally or to the Commission, unless otherwise publicly
available in electronic format on the website of the Company or the
Commission);
(i) To use
the net proceeds received by it from the sale of the Shares pursuant to this
Agreement in the manner specified in the Pricing Prospectus under the caption
“Use of Proceeds”;
(j) To use
its best efforts to list, subject to notice of issuance, the Shares on the New
York Stock Exchange (the “Exchange”);
(k) To file
with the Commission such reports as may be required by Rule 463 under the
Act;
(l) If the
Company elects to rely upon Rule 462(b), the Company shall file a Rule 462(b)
Registration Statement with the Commission in compliance with Rule 462(b) by
10:00 P.M., Washington, D.C. time, on the date of this Agreement, and the
Company shall at the time of filing either pay to the Commission the filing fee
for the Rule 462(b) Registration Statement or give irrevocable instructions for
the payment of such fee pursuant to Rule 111(b) under the Act;
(m) Upon
request of any Underwriter, to furnish, or cause to be furnished, to such
Underwriter an electronic version of the Company’s trademarks,
servicemarks and corporate logo for use on the website, if any, operated by
such Underwriter for the purpose of facilitating the on-line offering of the
Shares (the “License”); provided,
however, that
the License shall be used solely for the purpose described above, is granted
without any fee and may not be assigned or transferred;
(n) The
Company and its subsidiaries will use their respective best efforts to
implement and maintain an effective system of “disclosure controls and
procedures”
(as defined in Rule 13a-15(e) of the Exchange Act) that is designed to ensure
that information required to be disclosed by the Company in reports that it
will file or submit under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the Commission’s rules
and forms, including controls and procedures designed to ensure that such
information is accumulated and communicated to the Company’s management as
appropriate to allow timely decisions regarding required disclosure. Subsequent
to implementation, the Company and its subsidiaries will carry out evaluations
of the effectiveness of such disclosure controls and procedures as required by
Rule 13a-15 of the Exchange Act; and
(o) The
Company will not approve or effect any amendment or waiver to the Expense
Allocation Agreement that would, in any manner, remove or limit the
responsibility of the Fortress Operating Group for any expenses incurred or
other amounts payable by the Company under or in connection with this
Agreement, including indemnification, reimbursement and contribution
liabilities.
(p) The
Company agrees to use its best efforts to effect the deconsolidation of the
Funds as contemplated in the Pricing Prospectus on or prior to March 31, 2007.
6.
(a) The
Company represents and agrees that, without the prior consent of the
Representatives, it has not made and will not make any offer relating to the
Shares that would constitute a “free writing prospectus” as defined
in Rule 405 under the Act; each Underwriter represents and agrees that, without
the prior consent of the Company and the Representatives, it has not made and
will not make any offer relating to the Shares that would constitute a free
writing prospectus; any such free writing prospectus the use of which has been
consented to by the Company, and the Representatives is listed on Schedule
III(a) hereto;
(b) The
Company has complied and will comply with the requirements of Rule 433 under
the Act applicable to any Issuer Free Writing Prospectus, including timely
filing with the Commission or retention where required and legending; and the
Company represents that it has satisfied and agrees that it will satisfy the
conditions under Rule 433 under the Act to avoid a requirement to file with the
Commission any electronic road show;
(c) The
Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free
Writing Prospectus would conflict with the information in the Registration
Statement, the Pricing Prospectus or the Prospectus or would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances then
prevailing, not misleading, the Company will give prompt notice thereof to the
Representatives and, if requested by the Representatives, will prepare and
furnish without charge to each Underwriter an Issuer Free Writing Prospectus or
other document which will correct such conflict, statement or omission;
provided,
however, that
this Section 6(c) shall not apply to any statements or omissions in an Issuer
Free Writing Prospectus made in reliance upon
and in
conformity with information furnished in writing to the Company by an
Underwriter through the Representatives expressly for use therein.
7. The
Company covenants and agrees with the several Underwriters that the Company
will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Company’s counsel and accountants in connection with the
registration of the Shares under the Act and all other expenses in connection
with the preparation, printing, reproduction and filing of the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus and
the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing any Agreement among Underwriters, this Agreement, the
Blue Sky Memorandum, closing documents (including any compilations thereof) and
any other documents in connection with the offering, purchase, sale and
delivery of the Shares; (iii) all expenses in connection with the qualification
of the Shares for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky survey (iv) all fees and expenses in connection with listing the
Shares on the Exchange; (v) the filing fees incident to, and the fees and
disbursements of counsel for the Underwriters in connection with, any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Shares; (vi) the cost of preparing stock certificates; (vii)
the cost and charges of any transfer agent or registrar; (viii) all fees and
expenses incurred by the Underwriters in connection with the Directed Share
Program, including the fees and disbursements of counsel to the Underwriters
related thereto (not to exceed $10,000), the costs and expenses for printing
(or reproduction) and delivery (including postage, air freight charges and
charges for counting and packaging) of such copies of any prospectus wrapper or
the Directed Share Program material and stamp duties, similar taxes or duties
or other taxes, if any, incurred by the Underwriters in connection with the
Directed Share Program, and (ix) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 9 and 12 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
stock transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
8. The
obligations of the Underwriters hereunder, as to the Shares to be delivered at
each Time of Delivery, shall be subject, in their discretion, to the condition
that all representations and warranties and other statements of the Company
herein are, at and as of such Time of Delivery, true and correct, the condition
that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional
conditions:
(a) The
Prospectus shall have been filed with the Commission pursuant to Rule 424(b)
under the Act within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; all material required to be filed by the Company pursuant to Rule
433(d)
under
the Act shall have been filed with the Commission within the applicable time
period prescribed for such filing by Rule 433; if the Company has elected to
rely upon Rule 462(b) under the Act, the Rule 462(b) Registration Statement
shall have become effective by 10:00 P.M., Washington, D.C. time, on the date
of this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; no stop order suspending or preventing the use of the Prospectus or
any Issuer Free Writing Prospectus shall have been initiated or threatened by
the Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your reasonable
satisfaction;
(b) Sidley
Austin llp,
counsel for the Underwriters, shall have furnished to you their written opinion
(a draft of such opinion is attached as Annex I(a) hereto), dated such Time of
Delivery, with respect to such matters as you may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) (i)
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Company, shall
have furnished to you (x) their written opinion as counsel for the Company (a
draft of such opinion is attached as Annex I(b)(i)); (y) the tax opinion as
special tax counsel for the Company (a draft of such opinion is attached as
Annex I(b)(ii)), and (z) the negative assurance letter as counsel for the
Company (a draft of such letter is attached as Annex I(b)(iii)), and (ii) Xxxx
Xxxxxxx, General Counsel of the Company, shall have furnished to you his
written opinion as counsel for the Company (a draft of such opinion is attached
as Annex 1(b)(iv), in each case dated such Time of Delivery, in form and
substance satisfactory to you;
(d) On the
date of the Prospectus at a time prior to the execution of this Agreement, at
9:30 a.m., New York City time, on the effective date of any post effective
amendment to the Registration Statement filed subsequent to the date of this
Agreement and also at each Time of Delivery, Ernst & Young LLP shall have
furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in
Annex II hereto (the executed copy of the letter delivered prior to the
execution of this Agreement is attached as Annex II(a) hereto and a draft of
the form of letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex II(b) hereto);
(e) (i)
Neither the Company nor its Subsidiaries shall have sustained since the date of
the latest audited financial statements included in the Pricing Prospectus any
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Pricing Prospectus, and (ii) since the respective dates as
of which information is given in the Pricing Prospectus there shall not have
been any change in the capital stock or long term debt of the Company or any of
its subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs,
management,
financial position, members’ equity or results of operations of the
Company and its Subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Pricing Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(f) On or
after the Applicable Time (i) no downgrading shall have occurred in the rating
accorded the Company’s debt securities by any “nationally recognized
statistical rating organization”, as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the
Company’s debt securities;
(g) On or
after the Applicable Time there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally on
the New York Stock Exchange; (ii) a suspension or material limitation in
trading in the Company’s securities on the New York Stock Exchange; (iii)
a general moratorium on commercial banking activities declared by either
Federal or New York State authorities or a material disruption in commercial
banking or securities settlement or clearance services in the United States;
(iv) the outbreak or escalation of hostilities involving the United States or
the declaration by the United States of a national emergency or war or (v) the
occurrence of any other calamity or crisis or any change in financial,
political or economic conditions in the United States or elsewhere, if the
effect of any such event specified in clause (iv) or (v) in the judgment of the
Representatives makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the
Prospectus;
(h) The
Shares to be sold at such Time of Delivery shall have been duly listed, subject
to notice of issuance, on the New York Stock Exchange;
(i) The
Company shall have obtained and delivered to the Underwriters executed copies
of an agreement from each shareholder who upon consummation of the offering
will own 5% or more of the Class A Shares on a fully-diluted basis (including
Nomura), each director of the Company and each executive officer who, upon
consummation of the offering, will be a “reporting person” within the
meaning of Section 16 of the Act, substantially to the effect set forth in
Section 5(f) hereof in form and substance satisfactory to you;
(j) The
Company shall have complied with the provisions of Section 5(d) hereof with
respect to the furnishing of prospectuses on the New York Business Day next
succeeding the date of this Agreement;
(k) The
Company shall have furnished or caused to be furnished to you at such Time of
Delivery certificates of officers of the Company satisfactory to you
as to
the accuracy of the representations and warranties of the Company herein at and
as of such Time of Delivery, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to such Time of Delivery, as
to the matters set forth in subsections (a) and (e) of this Section and as to
such other matters as you may reasonably request; and
(l) Each of
the “Transactions” (as such term is defined in the Registration
Statement) disclosed in the Section of the Prospectus captioned “Our
Structure – The Transactions” as being completed prior to or
concurrently with the consummation of the offering of the Shares shall have
been completed.
9. (a) The
Company will indemnify and hold harmless each Underwriter against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any Preliminary Prospectus, the
Pricing Prospectus or the Prospectus, or any amendment or supplement thereto,
any Issuer Free Writing Prospectus or any “issuer information” filed
or required to be filed pursuant to Rule 433(d) under the Act, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided,
however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus
or the Prospectus, or any amendment or supplement thereto, or any Issuer Free
Writing Prospectus, in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the Representatives
expressly for use therein.
(b) Each
Underwriter will indemnify and hold harmless the Company against any losses,
claims, damages or liabilities to which the Company may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or
the Prospectus, or any amendment or supplement thereto, or any Issuer Free
Writing Prospectus, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, any Preliminary Prospectus, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus, in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
expressly for use therein;
and will
reimburse the Company for any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such action or
claim as such expenses are incurred.
(c) Promptly
after receipt by an indemnified party under subsection (a) or (b) above of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under
such subsection, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party shall not relieve
it from any liability which it may have to any indemnified party other than
under such subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation.
Notwithstanding anything contained herein to the contrary, if indemnity may be
sought pursuant to Section 9(f) hereof in respect of a claim or action referred
to in Section 9(f), then in addition to such separate firm for the indemnified
parties, the indemnifying party shall be liable for the fees and expenses of
not more than one separate firm (in addition to any local counsel) for each DSP
Manager and its respective DSP Manager Entities (as defined in Section 9(f))
for the defense of any loss, claim, damage, liability or action arising out of
the Directed Share Program. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with such consent,
the indemnifying party agrees to indemnify each indemnified party from and
against any loss or liability by reason of such settlement. No indemnifying
party shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified
party.
(d) If the
indemnification provided for in this Section 9 is unavailable to or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above in respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the
relative
benefits received by the Company on the one hand and the Underwriters on the
other from the offering of the Shares. If, however, the allocation provided by
the immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault of the Company, on the one hand, and the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company on the one hand or by the Underwriters on the other and the
parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro
rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters’ obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The
obligations of the Company under this Section 9 shall be in addition to any
liability which the Company may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act and each broker-dealer affiliate of any
Underwriter; and the obligations of the Underwriters under this Section 9 shall
be in addition to any liability which the respective Underwriters may otherwise
have and shall extend, upon the same terms and conditions, to each officer and
director the Company (including any
person
who, with his or her consent, is named in the Registration Statement as about
to become a director of the Company) and to each person, if any, who controls
the Company within the meaning of the Act.
(f) The
Company shall indemnify and hold harmless each DSP Manager (including its
respective directors, officers and employees) and each person, if any, who
controls such DSP Manager within the meaning of Section 15 of the Act
(collectively, the “DSP Manager Entities”), from and against any
loss, claim, damage or liability or any action in respect thereof to which each
DSP Manager or its respective DSP Manager Entities may become subject, under
the Act or otherwise, insofar as such loss, claim, damage, liability or action
(i) arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in any material prepared by or with the
approval of the Company for distribution to Directed Share Participants in
connection with the Directed Share Program or any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, (ii) arises out of, or is based
upon, the failure of the Directed Share Participant to pay for and accept
delivery of Directed Shares that the Directed Share Participant agreed to
purchase or (iii) is otherwise related to the Directed Share Program;
provided that,
the Company shall not be liable under this clause (iii) for any loss, claim,
damage, liability or action that is determined in a final judgment by a court
of competent jurisdiction to have resulted from the bad faith, gross negligence
or willful misconduct of such DSP Manager or its respective DSP Manager
Entities. The Company shall reimburse each DSP Manager and its respective DSP
Manager Entities promptly upon demand for any legal or other expenses
reasonably incurred by them in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action
as such expenses are incurred.
10.
(a) If any
Underwriter shall default in its obligation to purchase the Shares which it has
agreed to purchase hereunder at a Time of Delivery, you may in your discretion
arrange for you or another party or other parties to purchase such Shares on
the terms contained herein. If within thirty six hours after such default by
any Underwriter you do not arrange for the purchase of such Shares, then the
Company shall be entitled to a further period of thirty six hours within which
to procure another party or other parties satisfactory to you to purchase such
Shares on such terms. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the purchase of
such Shares, or the Company notifies you that it has so arranged for the
purchase of such Shares, you or the Company shall have the right to postpone
such Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments or supplements to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term “Underwriter” as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect to such
Shares.
(b) If,
after giving effect to any arrangements for the purchase of the Shares of a
defaulting Underwriter or Underwriters by you and the Company as provided in
subsection (a) above, the aggregate number of such Shares which remains
unpurchased does not exceed one eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, then the Company shall have
the right to require each non defaulting Underwriter to purchase the number of
shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If,
after giving effect to any arrangements for the purchase of the Shares of a
defaulting Underwriter or Underwriters by you and the Company as provided in
subsection (a) above, the aggregate number of such Shares which remains
unpurchased exceeds one eleventh of the aggregate number of all the Shares to
be purchased at such Time of Delivery, or if the Company shall not exercise the
right described in subsection (b) above to require non defaulting Underwriters
to purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Time of Delivery, the obligations of
the Underwriters to purchase and of the Company to sell the Optional Shares)
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 7 hereof and the indemnity and
contribution agreements in Section 9 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
11. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the Shares.
12. If this
Agreement shall be terminated pursuant to Section 10 hereof, the Company shall
not be under any liability to any Underwriter except as provided in Sections 7
and 9 hereof; but, if for any other reason, any Shares are not delivered by or
on behalf of the Company as provided herein, the Company will reimburse the
Underwriters through you for all out of pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company shall then be under no further
liability to any Underwriter except as provided in Sections 7 and 9
hereof.
13. In all
dealings hereunder, you shall act on behalf of each of the Underwriters, and
the parties hereto shall be entitled to act and rely upon any
statement,
request, notice or agreement on behalf of any Underwriter made or given by you
jointly or by either of Xxxxxxx, Xxxxx & Co. or Xxxxxx Brothers Inc. on
behalf of you as the Representatives.
All
statements, requests, notices and agreements hereunder shall be in writing, and
if to the Underwriters shall be delivered or sent by mail, telex or facsimile
transmission to you as the representatives in care of (i) Xxxxxxx, Xxxxx &
Co., Xxx Xxx Xxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department and (ii) Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Syndicate Registration; and if to the Company
shall be delivered or sent by mail, telex or facsimile transmission to the
address of the Company set forth in the Registration Statement, Attention:
Secretary; provided,
however, that
any notice to an Underwriter pursuant to Section 9(c) hereof shall be delivered
or sent by mail, telex or facsimile transmission to such underwriter at its
address set forth in its Underwriters’ Questionnaire, or telex
constituting such Questionnaire, which address will be supplied to the Company
by you upon request; provided,
however, that
notices under subsection 5(e) shall be in writing, and if to the Underwriters
shall be delivered or sent by mail, telex or facsimile transmission to you as
the representatives in care of (i) Xxxxxxx, Xxxxx & Co., 00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Control Room and (ii) Xxxxxx Brothers
Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate
Registration; provided, however, that any notice to a signatory of an agreement
described in Section 5(f) shall be delivered or sent by mail, telex or
facsimile transmission to the address of the signatory set forth in Schedule IV
hereto. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
14. This
Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters and the Company and, to the extent provided in Sections 9 and 11
hereof, the officers and directors of the Company and each person who controls
the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
15. Time
shall be of the essence of this Agreement. As used herein, the term
“business day” shall mean any day when the Commission’s office
in Washington, D.C. is open for business.
16. The
Company acknowledges and agrees that (i) the purchase and sale of the Shares
pursuant to this Agreement is an arm’s-length commercial transaction
between the Company, on the one hand, and the several Underwriters, on the
other, (ii) in connection therewith and with the process leading to such
transaction each Underwriter is acting solely as a principal and not the agent
or fiduciary of the Company, (iii) no Underwriter has assumed an advisory or
fiduciary responsibility in favor of the Company with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether
such Underwriter has advised or is currently advising the Company on other
matters) or any other obligation to the Company except the obligations
expressly set forth in this Agreement and (iv) the Company has consulted its
own
legal and financial advisors to the extent it deemed appropriate. The Company
agrees that it will not claim that the Underwriters, or any of them, has
rendered advisory services of any nature or respect, or owes a fiduciary or
similar duty to the Company, in connection with such transaction or the process
leading thereto.
17. This
Agreement supersedes all prior agreements and understandings (whether written
or oral) between the Company and the Underwriters, or any of them, with respect
to the subject matter hereof.
18. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
19. The
Company and each of the Underwriters hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any
legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
20. This
Agreement may be executed by any one or more of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but
all such counterparts shall together constitute one and the same
instrument.
21. Notwithstanding
anything herein to the contrary, the Company is authorized to disclose to any
persons the U.S. federal and state income tax treatment and tax structure of
the potential transaction and all materials of any kind (including tax opinions
and other tax analyses) provided to the Company relating to that treatment and
structure, without the Underwriters imposing any limitation of any kind.
However, any information relating to the tax treatment and tax structure shall
remain confidential (and the foregoing sentence shall not apply) to the extent
necessary to enable any person to comply with securities laws. For this
purpose, “tax structure” is limited to any facts that may be relevant
to that treatment.
If the
foregoing is in accordance with your understanding, please sign and return to
us eight counterparts hereof, and upon the acceptance hereof by you, on behalf
of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on your part as to
the authority of the signers thereof.
| Very truly yours, | ||
| Fortress Investment Group LLC | ||
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| By: | ||
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Name: |
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Title:
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Accepted
as of the date hereof: |
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| Xxxxxxx, Xxxxx & Co. | |||
| By: | |||
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Name:
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Title:
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| Xxxxxx Brothers Inc. | |||
| By: | |||
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Name:
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Title:
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