SEC Company Response from National CineMedia, Inc. (NCMI) (CIK 0001377630) (NCMI) — Feb 6, 2007
National CineMedia, Inc. (NCMI) (CIK 0001377630)
Date: Feb. 6, 2007 · CIK: 0001377630 · Accession: 0001193125-07-020742
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-137976
Referenced dates: February 5, 2007
Letter
Via EDGAR and Overnight Courier Division of Corporation Finance Re: National CineMedia, Inc. Amendment No. 5 to Registration Statement on Form S-1 Filed January 26, 2007 File No. 333-137976
Dear Mr. Spirgel:
On behalf of National CineMedia, Inc., a Delaware corporation (the “Company”), we have transmitted via EDGAR for filing with the Securities and Exchange Commission (the “Commission”) Amendment No. 6 to the above-referenced Registration Statement on Form S-1 of the Company (the “Registration Statement”).
The Registration Statement has been revised in response to the comments received from the staff of the Commission (the “Staff”) in its letter to Mr. Ralph E. Hardy dated February 5, 2007 (the “Feb. 5 Comment Letter”) and to update certain information. To facilitate your review, we are sending to the attention of William Bennett six copies of Amendment No. 6, three of which have been marked to show changes from Amendment No. 5 to the Registration Statement filed on January 26, 2007. All references to page numbers in the responses below refer to page numbers in the prospectus as revised in Amendment No. 6.
The responses and supplemental information provided herein in response to the Feb. 5 Comment Letter are based upon information provided by representatives of the Company and the Company’s advisors. We have not independently verified the accuracy and completeness of such information.
1700 Lincoln Street, Suite 4100 Denver, Colorado 80203-4541 tel 303.861.7000 fax 303.866.0200
Mr. Larry Spirgel
February 6,
Page 2
Responses to the Feb. 5 Comment Letter
For your convenience, we have restated the comments and the headings used in the Feb. 5 Comment Letter.
Prospectus Summary
Digital Cinemedia, page 7
1. Under Digital Cinema on page 7, quantify the monthly fee you will earn and file the amended and restated letter agreement relating to digital cinema as an exhibit.
The Company has revised the disclosure on pages 7, 104 and 148 to update the disclosure to reflect the current status of negotiations with the founding members about the provision of services by the Company to the yet-to-be-formed digital cinema venture. At this time, it is not known what services, if any, will be provided by the Company and on what terms. There are no plans for payment of fees and any future compensation arrangements will be subject to approval by a committee comprised of the Company’s independent directors. The references to the amended and restated letter agreement have been deleted since the terms of that agreement are no longer part of the structure being discussed by the parties.
Corporate History and Reorganization, page 74
Reorganization, page
2. You state on pages 37 and 76 the “[t]he purpose for issuing the preferred membership units in connection with the non-cash recapitalization, and for subsequently redeeming all the preferred membership units in connection with the offering, is to create an efficient mechanism for distributing all the redemption proceeds to [the] founding members.” Please explain here what you mean by “an efficient mechanism for distributing all the redemption proceeds,” and elaborate as to why the common membership units are being exchanged for, in part, preferred membership units that only will be redeemed shortly thereafter.
Mr. Larry Spirgel
February 6,
Page 3
The Company has revised the disclosure on pages 37 and 76 to explain what is meant by “an efficient mechanism for distributing all the redemption proceeds,” and to elaborate as to why the common membership units are being exchanged for, in part, preferred membership units that will be redeemed shortly thereafter.
Executive Compensation, page 117
Employment and Other Agreements, page 125
3. The employment agreement entered into with Kurt C. Hall indicates that his stretch bonus will be at least 150% of his base salary. See Exhibit 10.15. The disclosure on page 125 indicates that his stretch bonus will be at least 50% of his base salary. Please reconcile as necessary.
The Company has revised the disclosure on page 125 to clarify the formula for Mr. Hall’s bonus.
Part II
Item 16, Exhibit and Financial Schedules
4. Tell us why you have intentionally omitted exhibits 10.1 and 10.7.
The Company advises the Staff that Exhibit 10.1, which referred to the Senior Secured Credit Facility, and Exhibit 10.7, which referred to the Digital Cinema Services Agreement, were intentionally omitted because those agreements were still being negotiated and forms of these agreements had not yet been agreed upon by the parties at the time of filing Amendment No. 4 and Amendment No. 5 to the Registration Statement. Since that time, the parties have agreed upon a form of Senior Secured Credit Facility and that form of agreement is included in this filing. The Senior Secured Credit Facility and all other documents which were filed in form only will be filed on Form 8-K after execution. It is not
Mr. Larry Spirgel
February 6,
Page 4
known at this time whether a Digital Cinema Services Agreement will be negotiated in the future and therefore, no form of such agreement has been filed.
5. Regarding the exhibits for which confidential treatment has been requested, please include a legend indicating both that the material has been omitted pursuant to a request for confidential treatment and that the material has been filed separately with the Commission.
The Company has revised the legend for Exhibits 10.8, 10.10 and 10.11 on page II-3 to indicate both that the material has been omitted pursuant to a request for confidential treatment and that the material has been filed separately with the Commission.
Legality Opinion
6. Counsel’s opinion regarding the shares being registered must speak as of the date of effectiveness of the registration statement. Yet, in the final paragraph of the January 23, 2007 opinion included as an exhibit to Amendment No. 4 filed on January 24, 2007, counsel states that “[t]he opinions expressed herein are rendered as of the date hereof.” As a result, please file a revised opinion with your next pre-effective amendment that does not include the initial two sentences of the final paragraph or that otherwise ensures the opinion speaks as of the date of effectiveness of the registration statement.
The Company has included as an exhibit to Amendment No. 6 a revised legal opinion that does not include the initial two sentences of the final paragraph as previously filed.
Mr. Larry Spirgel
February 6,
Page 5
If you would like to discuss any of the responses above or any other matter, please contact W. Dean Salter at (303) 866-0245, Mashenka Lundberg at (303) 866-0616, or Jennifer D’Alessandro at (303) 866-0635.
Sincerely,
/s/ Holme Roberts & Owen LLP
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Response Letter
DENVER
BOULDER
COLORADO SPRINGS
LONDON
LOS ANGELES
MUNICH
SALT LAKE CITY
SAN FRANCISCO
February 6, 2007
Via EDGAR and Overnight Courier
Mr. Larry Spirgel
Assistant Director
Division of Corporation Finance
U.S. Securities and Exchange
Commission
100 F Street, N.E.
Washington, D. C.
20549-3720
Re: National
CineMedia, Inc.
Amendment No. 5 to
Registration Statement on Form S-1
Filed
January 26, 2007
File No.
333-137976
Dear Mr. Spirgel:
On behalf of National CineMedia, Inc., a Delaware corporation (the
“Company”), we have transmitted via EDGAR for filing with the Securities and Exchange Commission (the “Commission”) Amendment No. 6 to the above-referenced Registration Statement on Form S-1 of the Company (the
“Registration Statement”).
The Registration Statement
has been revised in response to the comments received from the staff of the Commission (the “Staff”) in its letter to Mr. Ralph E. Hardy dated February 5, 2007 (the “Feb. 5 Comment Letter”) and to update certain
information. To facilitate your review, we are sending to the attention of William Bennett six copies of Amendment No. 6, three of which have been marked to show changes from Amendment No. 5 to the Registration Statement filed on
January 26, 2007. All references to page numbers in the responses below refer to page numbers in the prospectus as revised in Amendment No. 6.
The responses and supplemental information provided herein in response to the Feb. 5 Comment Letter are based upon information provided by
representatives of the Company and the Company’s advisors. We have not independently verified the accuracy and completeness of such information.
1700 Lincoln Street, Suite 4100 Denver, Colorado 80203-4541 tel 303.861.7000
fax 303.866.0200
Mr. Larry Spirgel
February 6,
2007
Page 2
Responses to the Feb. 5 Comment Letter
For your convenience, we have restated the comments and the headings used in the Feb. 5 Comment Letter.
Prospectus Summary
Digital Cinemedia, page 7
1. Under Digital
Cinema on page 7, quantify the monthly fee you will earn and file the amended and restated letter agreement relating to digital cinema as an exhibit.
The Company has revised the disclosure on pages 7, 104 and 148 to update the disclosure to reflect the current status of negotiations with the
founding members about the provision of services by the Company to the yet-to-be-formed digital cinema venture. At this time, it is not known what services, if any, will be provided by the Company and on what terms. There are no plans for payment of
fees and any future compensation arrangements will be subject to approval by a committee comprised of the Company’s independent directors. The references to the amended and restated letter agreement have been deleted since the terms of that
agreement are no longer part of the structure being discussed by the parties.
Corporate History and Reorganization, page 74
Reorganization, page
75
2. You state on pages 37 and 76 the “[t]he purpose for issuing the preferred membership units in connection with the non-cash recapitalization, and for subsequently redeeming all the preferred
membership units in connection with the offering, is to create an efficient mechanism for distributing all the redemption proceeds to [the] founding members.” Please explain here what you mean by “an efficient mechanism for distributing
all the redemption proceeds,” and elaborate as to why the common membership units are being exchanged for, in part, preferred membership units that only will be redeemed shortly thereafter.
Mr. Larry Spirgel
February 6,
2007
Page 3
The Company has revised the disclosure on pages 37 and 76 to explain what is meant by “an efficient mechanism for distributing all the
redemption proceeds,” and to elaborate as to why the common membership units are being exchanged for, in part, preferred membership units that will be redeemed shortly thereafter.
Executive Compensation, page 117
Employment and Other Agreements, page 125
3. The employment
agreement entered into with Kurt C. Hall indicates that his stretch bonus will be at least 150% of his base salary. See Exhibit 10.15. The disclosure on page 125 indicates that his stretch bonus will be at least 50% of his base salary. Please
reconcile as necessary.
The Company has revised the disclosure
on page 125 to clarify the formula for Mr. Hall’s bonus.
Part
II
Item 16, Exhibit and Financial Schedules
4. Tell us why you
have intentionally omitted exhibits 10.1 and 10.7.
The Company
advises the Staff that Exhibit 10.1, which referred to the Senior Secured Credit Facility, and Exhibit 10.7, which referred to the Digital Cinema Services Agreement, were intentionally omitted because those agreements were still being negotiated and
forms of these agreements had not yet been agreed upon by the parties at the time of filing Amendment No. 4 and Amendment No. 5 to the Registration Statement. Since that time, the parties have agreed upon a form of Senior Secured Credit
Facility and that form of agreement is included in this filing. The Senior Secured Credit Facility and all other documents which were filed in form only will be filed on Form 8-K after execution. It is not
Mr. Larry Spirgel
February 6,
2007
Page 4
known at this time whether a Digital Cinema Services Agreement will be negotiated in the future and therefore, no form of such agreement has been filed.
5. Regarding the
exhibits for which confidential treatment has been requested, please include a legend indicating both that the material has been omitted pursuant to a request for confidential treatment and that the material has been filed separately with the
Commission.
The Company has revised the legend for
Exhibits 10.8, 10.10 and 10.11 on page II-3 to indicate both that the material has been omitted pursuant to a request for confidential treatment and that the material has been filed separately with the Commission.
Legality Opinion
6. Counsel’s
opinion regarding the shares being registered must speak as of the date of effectiveness of the registration statement. Yet, in the final paragraph of the January 23, 2007 opinion included as an exhibit to Amendment No. 4 filed on
January 24, 2007, counsel states that “[t]he opinions expressed herein are rendered as of the date hereof.” As a result, please file a revised opinion with your next pre-effective amendment that does not include the initial two
sentences of the final paragraph or that otherwise ensures the opinion speaks as of the date of effectiveness of the registration statement.
The Company has included as an exhibit to Amendment No. 6 a revised legal opinion that does not include the initial two sentences of the final
paragraph as previously filed.
Mr. Larry Spirgel
February 6,
2007
Page 5
If you would like to discuss any of the responses above or any other matter, please contact W. Dean Salter at (303) 866-0245, Mashenka Lundberg
at (303) 866-0616, or Jennifer D’Alessandro at (303) 866-0635.
Sincerely,
/s/ Holme Roberts & Owen LLP
Holme Roberts & Owen LLP
cc: William Bennett
Cheryl Grant
Claire
DeLabar
Carlos Pacho
Ralph E. Hardy
Mark Wehrle
Casey T. Fleck
Nicholas P. Saggese