EXHIBIT 1.1
COINMACH SERVICE CORP.
(a Delaware corporation)
Income Deposit Securities
(IDSs)
and
[ ]% Senior Secured Notes due 2024
PURCHASE AGREEMENT
Dated: November [ ], 2004
COINMACH SERVICE CORP.
(a Delaware corporation)
[ ] Income Deposit Securities
Each Representing One Share of
Class A Common Stock, par value $0.01 per share, and
$[ ] Principal Amount of [ ]% Senior Secured Notes due 2024
and
$[ ] Aggregate Principal Amount of [ ]% Senior Secured Notes due 2004
PURCHASE AGREEMENT
November [ ], 2004
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
as Representative of the several Underwriters
4 World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Coinmach Service Corp., a Delaware corporation (the "Company"), confirms
its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxxx Xxxxx is acting as representative (in such capacity,
the "Representative"), with respect to the issue and sale by the Company and the
purchase by the Underwriters, acting severally and not jointly, of (i) an
aggregate of [ ] Income Deposit Securities ("IDSs"), representing an aggregate
of [ ] shares of the Company's Class A common stock, par value $0.01 per share
(the "Common Stock"), and $[ ] aggregate principal amount of the Company's [ ]%
Senior Secured Notes due 2024 (the "IDS Notes"), and (ii) an additional $[ ]
aggregate principal amount of the Company's [ ]% Senior Secured Notes due 2024
(the "Third Party Notes" and, together with the IDS Notes, the "Notes"), in each
case as set forth in Schedule A hereto, and with respect to the grant by the
Company to the Underwriters, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of an additional [
] IDSs to cover over-allotments, if any. The Notes will initially be fully and
unconditionally guaranteed on a senior secured basis (the "Guarantee" and,
together with the Notes, the "Note Securities" ) by Coinmach Laundry
Corporation, a Delaware corporation ("Laundry Corp." and, together with any
future guarantor, the "Guarantors"). Each IDS represents one share of Class A
Common Stock and $[ ] principal amount of the IDS Notes. Unless the context
otherwise requires, the [ ] IDSs (the "Initial Securities") to be purchased by
the Underwriters on the Closing Time (as defined in Section 2(c) hereof) and all
or any part of
the [ ] IDSs subject to the option described in Section 2(b) hereof (the "Option
Securities") are hereinafter called, collectively with the Common Stock and the
Note Securities, the "Securities".
The Note Securities will be issued pursuant to an indenture to be dated as
of November [ ], 2004 (the "Indenture") between the Company, the Guarantors and
The Bank of New York, as trustee (the "Trustee").
The Notes will be secured by a first priority lien on substantially all of
the existing and future assets of the Company, including, without limitation,
(a) an intercompany note (the "Intercompany Note") issued by Coinmach
Corporation ("Coinmach Corp.") to the Company, (b) the guarantees of the
Intercompany Note (the "Intercompany Note Guarantees" and, together with the
Intercompany Note, the "Intercompany Note Obligations") by certain subsidiaries
of Coinmach Corp., (c) 100% of the capital stock Laundry Corp. and (d) 100% of
the common stock of Appliance Warehouse of America, Inc., a Delaware corporation
("AWA") (collectively, the "Company Collateral"). The Guarantee by Laundry Corp.
will be secured by a first priority lien on substantially all of the existing
and future assets of Laundry Corp., other than the capital stock of Coinmach
Corp., which will be secured by a second priority lien (collectively, the
"Laundry Corp. Collateral" and together with the Company Collateral, the
"Collateral"). The lien on the capital stock of Coinmach Corp. will be
subordinated, pursuant to the Intercreditor Agreement, to the lien of the Agent
(as defined below) under the Credit Facility (as defined below). At the Closing
Time, the Company will deliver to The Bank of New York, as collateral agent (the
"Collateral Agent"), pursuant to the terms of the Indenture and the Security
Agreement (as defined below), financing statements (the "Financing Statements")
listing each of the Company and Laundry Corp. as a debtor and the Collateral
Agent as secured party and covering the Collateral under the security agreement
among the Collateral Agent (on its own behalf and on behalf of the Trustee and
the holders of Notes), Laundry Corp. and the Company (the "Security Agreement")
In addition, the Company and Laundry Corp., as pledgors, and the Collateral
Agent will enter into the pledge agreement to be dated as of the Closing Time
(the "Pledge Agreement" and, together with the Financing Statements, the
Security Agreement and the Intercreditor Agreement, the "Collateral Documents").
The Collateral Documents will provide for the filing, recordation, indexing and
other action as specified therein with respect to the perfection of the liens on
the Collateral. In addition, the capital stock of Coinmach Corp. will be subject
to a first priority lien pursuant to Coinmach Corp.'s amended senior secured
credit facility (the "Credit Facility") to be dated as of the Closing Time among
Coinmach Corp., Deutsche Bank Trust Company Americas, as administrative agent
(the "Agent") and the lenders named therein (the "Lenders") and the other
persons party thereto from time to time. The agreement relating to the sharing
of such capital stock and the proceeds thereof among the Collateral Agent (on
its own behalf and on behalf of the Trustee and the holders of Notes) and the
Agent (on its own behalf and on behalf of the Lenders) will be contained in a
certain intercreditor agreement (the "Intercreditor Agreement") to be dated as
of the Closing Time among the Company, Laundry Corp., Coinmach Corp., the
Collateral Agent and the Agent.
The Company understands that the Underwriters propose to make a public
offering of the Initial Securities and Third Party Notes as soon as the
Representative deems advisable after this Agreement has been executed and
delivered.
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The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-114421), including
the related preliminary prospectus or prospectuses, covering the registration of
the Securities under the Securities Act of 1933, as amended (the "1933 Act").
Promptly after execution and delivery of this Agreement, the Company will
prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of
the 1933 Act Regulations. The information included in such prospectus that was
omitted from such registration statement at the time it became effective but
that is deemed to be part of such registration statement at the time it became
effective pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A
Information." Each prospectus used before such registration statement became
effective, and any prospectus that omitted the Rule 430A Information, that was
used after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits and any schedules thereto, at the time it
became effective, and including the Rule 430A Information, is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. The final prospectus in
the form first furnished to the Underwriters for use in connection with the
offering of the Securities is herein called the "Prospectus." For purposes of
this Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system ("XXXXX").
In connection with this offering, the Company will consummate certain
restructuring transactions as described in the preliminary prospectus under
"Summary--Summary of the Transactions", "Use of Proceeds" and "The Transactions"
(collectively, the "Related Transactions"). The primary agreements relating to
the Related Transactions are listed on Schedule D hereto (collectively with the
Collateral Documents, the "Related Transaction Documents").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and Laundry Corp. Each
of the Company and Laundry Corp. represents and warrants to each Underwriter as
of the date hereof, as of the Closing Time, and as of each Date of Delivery (if
any) referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement and any
post-effective amendment thereto has become effective under the 1933 Act,
and no stop order suspending the effectiveness of the Registration
Statement, any Rule 462(b) Registration Statement or any post-effective
amendment thereto has been issued under the 1933 Act, and no proceedings
for that purpose have been instituted or are pending or, to the knowledge
of the Company, are contemplated by the Commission, and any request on the
part of the Commission for additional information has been complied with.
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At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto,
but excluding for the purposes of this representation the exhibits
thereto, complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and did not and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. Neither the Prospectus nor any
amendments or supplements thereto, at the time the Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), included or
will include an untrue statement of a material fact or omitted or will
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The representations and warranties in this subsection shall
not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx
Xxxxx expressly for use in the Registration Statement (or any amendment
thereto) or the Prospectus (or any amendment or supplement thereto).
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus delivered
to the Underwriters for use in connection with this offering was identical
to the electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(ii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout
the periods involved. The supporting schedules included in the
Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected financial data and
the summary financial information included in the Prospectus present
fairly the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included in the
Registration Statement. The pro forma financial statements and the related
notes thereto included in the Registration Statement and the Prospectus
present fairly the information shown therein, have been prepared in
accordance with the Commission's rules and guidelines with respect to pro
forma financial
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statements and have been properly compiled on the bases described therein,
and the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business (a "Material Adverse Effect"), (B) there
have been no transactions entered into by the Company or any of its
subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiaries considered
as one enterprise, and (C) there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its capital
stock.
(v) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its obligations
under this Agreement and the Related Transaction Documents; and the
Company is duly qualified as a foreign corporation to transact business
and is in good standing in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure so to
qualify or to be in good standing would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect.
(vi) Good Standing of Subsidiaries. Laundry Corp. and each
"significant subsidiary" of the Company (as such term is defined in Rule
1-02 of Regulation S-X, including, without limitation, Laundry Corp.,
Coinmach Corp., AWA and Super Laundry Equipment Corp., a New York
corporation) (each, a "Subsidiary" and collectively, the "Subsidiaries")
has been duly organized and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure so to qualify or to be in good
standing would not reasonably be expected to result in a Material Adverse
Effect; except as otherwise disclosed in the Registration Statement, all
of the issued and outstanding capital stock of each such Subsidiary has
been duly authorized and validly issued, is fully paid and non-assessable
and is owned by the Company, directly or through subsidiaries, free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim
or equity; none of the outstanding shares of capital stock of any
Subsidiary was issued in violation of the preemptive or similar rights of
any securityholder of such Subsidiary. The only subsidiaries of the
Company are (a) the subsidiaries listed on Exhibit 21 to the Registration
Statement and (b) certain other
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subsidiaries which, considered in the aggregate as a single Subsidiary, do
not constitute a "significant subsidiary" as defined in Rule 1-02 of
Regulation S-X.
(vii) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus in the column
entitled "Actual" under the caption "Capitalization" (except for
subsequent issuances, if any, pursuant to this Agreement, pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectus or pursuant to the exercise of convertible securities or
options referred to in the Prospectus). The shares of issued and
outstanding capital stock (including, without limitation, the Common
Stock) of the Company have been duly authorized and validly issued and are
fully paid and non-assessable; none of the outstanding shares of capital
stock (including, without limitation, the Common Stock) of the Company was
issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
(viii) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by each of the Company and Laundry
Corp.
(ix) Authorization and Enforceability of the Securities. The
Securities have been duly authorized for issuance and sale to the
Underwriters pursuant to this Agreement and, when issued and delivered by
the Company and Laundry Corp., as applicable, pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued, fully paid and non-assessable and will constitute valid and
binding obligations of the Company and Laundry Corp., as applicable,
enforceable against the Company and Laundry Corp., as applicable, in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers) reorganization, moratorium or similar
laws affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law);
no holder of the Securities will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder of
the Company.
(x) Authorization and Enforceability of the Indenture. The Indenture
has been duly authorized by the Company and Laundry Corp. and meets the
standards and requirements for qualification under the United States Trust
Indenture Act of 1939, as amended (the "1939 Act"), and -------- the rules
and regulations of the Commission applicable to an indenture that is
qualified thereunder, and, when executed and delivered by the Company,
Laundry Corp. and the Trustee, will constitute a valid and binding
agreement of the Company and Laundry Corp. enforceable against the Company
and Laundry Corp. in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(xi) Authorization and Enforceability of the Note Securities. The
Note Securities have been duly authorized and, at the Closing Time, will
have been duly executed
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by the Company and Laundry Corp., as applicable, and, when duly
authenticated, issued and delivered in the manner provided for in the
Indenture and delivered against payment of the purchase price therefor as
provided in this Agreement, will constitute valid and binding obligations
of the Company and Laundry Corp., as applicable, enforceable against the
Company and Laundry Corp. in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent transfers)
reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is subject
to general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits of, the Indenture.
(xii) Authorization and Enforceability of the Intercompany Note
Obligations. The Intercompany Note and Intercompany Note Guarantees have
been duly authorized and, at the Closing Time, will have been duly
executed by Coinmach Corp. and each of the guarantors under the
Intercompany Guarantees (the "Intercompany Note Guarantors"), as
applicable, and, when authenticated, issued and delivered to the Company,
will constitute valid and binding obligations of Coinmach Corp. and the
Intercompany Note Guarantors, as applicable, enforceable against Coinmach
Corp. and the Intercompany Note Guarantors, as applicable, in accordance
with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating
to fraudulent transfers) reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law).
(xiii)Authorization of the Related Transaction Documents. The
Related Transaction Documents have been duly authorized (to the extent a
party thereto) by the Company and its subsidiaries, as applicable, and
when executed and delivered (to the extent a party thereto) by the Company
and its subsidiaries (assuming the due authorization, execution and
delivery by each of the other parties thereto), will constitute valid and
legally binding agreements of the Company and its subsidiaries (to the
extent a party thereto), enforceable against them in accordance with their
terms, in each case, to the extent the Company or such subsidiary is a
party thereto, and except that the enforcement thereof may be limited by
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws affecting the enforcement of creditors'
rights generally and by general equitable principles.
(xiv) Description of the Securities, the Indenture and the
Intercompany Note Obligations. The Securities, the Indenture and the
Intercompany Note Obligations will conform in all material respects to the
statements relating thereto contained in the Prospectus.
(xv) Copies of Related Transaction Documents. The Company has
delivered to the Representative a true and correct copy of each of the
Related Transaction Documents that have been executed and delivered prior
to the date of this Agreement and each other Related Transaction Document
in the form substantially as it will be executed
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and delivered on or prior to the Closing Time, together with all schedules
and exhibits thereto, and as of the date hereof there have been no
material amendments, alterations, modifications or waivers of any of the
provisions of any of the Related Transaction Documents since their date of
execution or from the form in which such Related Transaction Documents
have been delivered to the Representative. The Related Transaction
Documents conform, in all material respects, with the descriptions thereof
in the Registration Statement or the Prospectus.
(xvi) Absence of Defaults and Conflicts. Neither the Company nor any
of its subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party or
by which it or any of them may be bound, or to which any of the property
or assets of the Company or any of its subsidiaries is subject
(collectively, "Agreements and Instruments") except for such defaults that
would not, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Indenture, the Securities, the
Intercompany Note Obligations and the Related Transaction Documents and
any other agreement or instrument entered into or issued or to be entered
into or issued by the Company in connection with the transactions
contemplated hereby or thereby or in the Prospectus and the consummation
of the transactions contemplated herein and in the Registration Statement
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus
under the caption "Use of Proceeds") and compliance by the Company with
its obligations hereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the
giving of notice or passage of time or both, conflict with or constitute a
breach of, or default or Repayment Event (as defined below) under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its subsidiaries
pursuant to, the Agreements and Instruments except for (a) with respect to
liens, charges or encumbrances, the liens in favor of the Collateral Agent
contemplated by the Collateral Documents and (b) such conflicts, breaches,
defaults or Repayments Events or liens, charges or encumbrances that,
individually or in the aggregate, would not reasonably be expected to
result in a Material Adverse Effect, nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or
any of its subsidiaries or, except such violations that, individually or
in the aggregate, would not reasonably be expected to result in a Material
Adverse Effect, any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any of
its subsidiaries or any of their assets, properties or operations. As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any of its subsidiaries.
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(xvii)Absence of Labor Dispute. No labor dispute with the employees
of the Company or any subsidiary exists or, to the knowledge of the
Company, is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or any
subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, would reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect.
(xviii) Taxes. The Company and its subsidiaries have timely filed
all federal, state, local and foreign tax returns that are required to be
filed or have duly requested extensions thereof and all such tax returns
are true, correct and complete, except to the extent that any failure to
file or request an extension, or any incorrectness would not, individually
or in the aggregate, reasonably be expected to result in a Material
Adverse Effect. The Company and its Subsidiaries have timely paid all
taxes shown as due on such filed tax returns (including any related
assessments, fines or penalties), except to the extent that any such taxes
are being contested in good faith and by appropriate proceedings, or to
the extent that any failure to pay would not reasonably be expected to
result in a Material Adverse Effect; and adequate charges, accruals and
reserves have been provided for in the financial statements referred to in
Section 1(a)(iii) above in accordance with GAAP in respect of all federal,
state, local and foreign taxes for all periods as to which the tax
liability of the Company or any of its Subsidiaries has not been finally
determined or remains open to examination by applicable taxing
authorities, except to the extent that any failure to create adequate
charges, accruals and reserves would not reasonably be expected to result
in a Material Adverse Effect.
(xix) Internal Controls. The Company and its subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with
management's general or specific authorization, (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets, (C) access
to assets is permitted only in accordance with management's general or
specific authorization and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(xx) Insurance. The Company and its subsidiaries carry or are
entitled to the benefits of insurance with financially sound and reputable
insurers in such amounts and covering such risks as in the good faith
judgment of the Board of Directors of the Company is sufficient given the
nature of the Company's business as of the date hereof, all of which
insurance is duly in force and effect.
(xxi) ERISA. None of the Company or its subsidiaries has any
material liability for any prohibited transaction with respect to any
pension, profit sharing or other plan that is subject to the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"). None of
the Company or any of its subsidiaries maintains or has any obligation to
contribute to or otherwise has any liability with respect to any pension
plan subject to Title IV of ERISA. Each pension, profit sharing or other
plan that is subject to ERISA and
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which is maintained by the Company or any subsidiary of the Company is in
compliance in all material respects with all applicable provisions of
ERISA.
(xxii)Statistical and Market-Related Data. The statistical and
market-related data included in the Prospectus are based on or derived
from sources which the Company believes to be reliable and accurate.
(xxiii) NASD. There are no affiliations with the National
Association of Securities Dealers, Inc. (the "NASD") among the Company's
officers, directors or any stockholder of the Company, except as disclosed
in the Registration Statement.
(xxiv)Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company or any
subsidiary, which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or that would, individually
or in the aggregate, be reasonably expected to result in a Material
Adverse Effect, or that would reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation of
the transactions contemplated in this Agreement or in the Related
Transaction Documents or the performance by the Company of its obligations
hereunder; the aggregate of all pending legal or governmental proceedings
to which the Company or any subsidiary is a party or of which any of their
respective property or assets is the subject which are not described in
the Registration Statement, including ordinary routine litigation
incidental to the business, could not reasonably be expected to result in
a Material Adverse Effect.
(xxv) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required. Each contract or document that is filed
as an exhibit to the Registration Statement is a true and complete copy of
the contract or document that it purports to be.
(xxvi)Possession of Intellectual Property. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them and described in the Registration Statement or
Prospectus, and neither the Company nor any of its subsidiaries has
received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its subsidiaries therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or finding)
or invalidity or inadequacy would, individually or in the aggregate,
result in a Material Adverse Effect.
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(xxvii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale
of the Securities hereunder or the consummation of the transactions
contemplated by this Agreement, the Indenture, the Intercompany Note
Obligations or the Related Transaction Documents, except (A) such as have
been already obtained, (B) such as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and sale
of the Securities, and (C) the filing of the Financing Statements with the
Secretary of State of the State of Delaware.
(xxviii) Absence of Manipulation. None of the Company, any affiliate
controlled by the Company within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act or, to the knowledge of the Company, any
other affiliate of the Company has taken, nor will the Company, any
affiliate controlled by the Company or, to the knowledge of the Company,
any other affiliate of the Company take, directly or indirectly, any
action which is designed to or which has constituted or which would be
expected to cause or result in stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the
Securities or the Common Stock or Notes underlying the Securities.
(xxix)Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them and described in
the Registration Statement or Prospectus, except where the failure so to
possess would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect; the Company and its
subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect; and neither the Company
nor any of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such Governmental
Licenses which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected to
result in a Material Adverse Effect.
(xxx) Title to Property. The Company and its Subsidiaries have good
and marketable title to all real property owned by the Company and its
Subsidiaries and good title to all other properties owned by them, in each
case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (a) are
described in the Prospectus, (b) constitute Permitted Liens (as defined in
the Indenture) or (c) do not, individually or in the aggregate, materially
and adversely affect the value of such property and do not interfere with
the use made and proposed to be
11
made of such property by the Company or any of its Subsidiaries; and all
of the leases and subleases material to the business of the Company and
its subsidiaries, considered as one enterprise, and under which the
Company or any of its subsidiaries holds properties described in the
Prospectus, are in full force and effect, and neither the Company nor any
subsidiary has any notice of any claim of any sort that has been asserted
by anyone adverse to the rights of the Company or any subsidiary under any
of the leases or subleases mentioned above, or affecting or questioning
the rights of the Company or such subsidiary to the continued possession
of the leased or subleased premises under any such lease or sublease, in
each case, except as would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
(xxxi)Investment Company Act. The Company is not required, and upon
the issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be required, to register as an "investment company" under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxxii) Environmental Laws. Except as described in the Registration
Statement or Prospectus and except as would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect,
(A) neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating to
the release or threatened release of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or petroleum
products, asbestos-containing materials or mold (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Materials
(collectively, "Environmental Laws"), (B) the Company and its subsidiaries
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or, to the Company's knowledge,
threatened administrative, regulatory or judicial actions, suits,
investigations or proceedings relating to any Environmental Law against
the Company or any of its subsidiaries and (D) there are no events or
circumstances that would reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency, against or affecting the
Company or any of its subsidiaries relating to Hazardous Materials or any
Environmental Laws.
(xxxiii) Solvency. Immediately prior to and after the consummation
of the transactions contemplated by this Agreement and the Related
Transactions, (i) the fair value and present fair saleable value of the
assets of the Company and its subsidiaries taken as a whole will exceed
the sum of its stated liabilities and identified contingent liabilities;
and (ii) the Company and its subsidiaries taken as a whole is not, nor
will it be,
12
after giving effect to the execution, delivery and performance of this
Agreement and the Related Transaction Documents, and the consummation of
the transaction contemplated hereby and thereby, (a) left with
unreasonably small capital with which to carry on its business as it is
proposed to be conducted, (b) unable to pay its debts (contingent or
otherwise) as they mature or (c) otherwise insolvent.
(xxxiv) Security Interests. The Collateral Documents, once executed
and delivered in connection with the sale of the Securities, and upon the
proper filing and indexation of applicable Financing Statements with the
proper governmental authorities (together with payment of the appropriate
filing fees), will create valid and perfected security interests in the
personal property and fixtures subject thereto in favor of the Collateral
Agent on behalf of the holders of the Notes, subject only to Permitted
Liens (as defined in the Indenture).
(xxxv)Reorganization. Concurrently with or prior to the Closing
Time, Coinmach Holdings, LLC, a Delaware limited liability company
("Holdings") has exchanged (a) certain shares of capital stock of Laundry
Corp. for outstanding units of Holdings in order to redeem such Holdings
units, and (b) all the remaining outstanding shares of capital stock of
Laundry Corp and all of the shares of non-voting common stock of AWA for
shares of Company's Class B common stock, par value $0.01 per share (such
transactions collectively referred to as the "Reorganization"), such that,
after giving effect to the Reorganization, Laundry Corp. will be a direct
wholly owned subsidiary of the Company and AWA will be entirely owned by
the Company and Coinmach Corp.
(xxxvi) Listing. The IDSs have been duly authorized for listing on
the American Stock Exchange, subject only to official notice of issuance.
A registration statement with respect to the IDSs has been filed on Form
8-A pursuant to Section 12 of the 1934 Act, which registration statement
complies in all material respects with the 1934 Act. The Company has taken
no action designed to, or likely to have the effect of, terminating the
registration of the Securities under the 1934 Act, nor has the Company
received any notification that the Commission is contemplating terminating
such registration.
(xxxvii) Registration Rights. There are no persons with registration
rights or other similar rights to have any securities registered under the
1933 Act pursuant to the Registration Statement or otherwise registered by
the Company under the 1933 Act.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Representative or to counsel
for the Underwriters shall be deemed a representation and warranty by the
Company to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per IDS and per Third Party Note set forth in
13
Schedule B, the number of Initial Securities and Third Party Notes, in each case
as set forth in Schedule A opposite the name of such Underwriter, plus any
additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional [ ] IDSs at the price per IDS
set forth in Schedule B, less an amount per IDS equal to any dividends or
distributions declared by the Company and payable on the Initial Securities but
not payable on the Option Securities. The option hereby granted will expire 30
days after the date hereof and may be exercised in whole or in part from time to
time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial Securities upon
notice by Xxxxxxx Xxxxx to the Company setting forth the number of Option
Securities as to which the several Underwriters are then exercising the option
and the time and date of payment and delivery for such Option Securities. Any
such time and date of delivery (a "Date of Delivery") shall be determined by
Xxxxxxx Xxxxx, but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the
Option Securities, each of the Underwriters, acting severally and not jointly,
will purchase that proportion of the total number of Option Securities then
being purchased which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as Xxxxxxx Xxxxx in its
discretion shall make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Third Party Notes and the Initial Securities shall be made
at the offices of Xxxxxx Xxxxxx & Xxxxxxx LLP, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, or at such other place as shall be agreed upon by the Representative
and the Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day
after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Representative and the Company (such time and
date of payment and delivery, the "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representative
and the Company, on each Date of Delivery as specified in the notice from the
Representative to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated in writing by the Company, against
delivery to the Representative for the respective accounts of the Underwriters
of certificates for the Securities to be purchased by them. It is understood
that each Underwriter has authorized the Representative, for its account, to
accept delivery of, receipt for, and make payment of the purchase price for, the
Third Party Notes, the Initial Securities and the Option Securities, if any,
which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the Underwriters, may (but shall
14
not be obligated to) make payment of the purchase price for the Third Party
Notes, the Initial Securities or the Option Securities, if any, to be purchased
by any Underwriter whose funds have not been received by the Closing Time or the
relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Third Party Notes
(including the Guarantees thereof), the Initial Securities and the Option
Securities, if any, shall be in such denominations and registered in such names
as the Representative may request in writing at least one full business day
before the Closing Time or the relevant Date of Delivery, as the case may be.
The certificates for the Third Party Notes (including the Guarantees thereof),
the Initial Securities and the Option Securities, if any, will be made available
for examination and packaging by the Representative in The City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior to the Closing
Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
and will notify the Representative promptly, and confirm the notice in writing,
(i) when any post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectus or any amended Prospectus shall
have been filed, (ii) of the receipt of any comments from the Commission
regarding the Registration Statement or otherwise relating to or in connection
with the proposed offering of the Securities, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) and will take such
steps as it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file such
prospectus. The Company will use commercially reasonable efforts to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest practicable moment.
(b) Filing of Amendments. The Company will give the Representative notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)) or any amendment, supplement or
revision to either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, will furnish the Representative
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Representative or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or will
deliver to the Representative and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed
15
therewith or incorporated by reference therein) and signed copies of all
consents and certificates of experts, and will also deliver to the
Representative, without charge, a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act, such number of copies
of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations so as to permit the completion of
the distribution of the Securities as contemplated in this Agreement and in the
Prospectus. If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the opinion of
counsel for the Underwriters and counsel for the Company, to amend the
Registration Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statements of a material fact or omit to
state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company will, as soon as reasonably
practicable, prepare and file with the Commission, subject to Section 3(b), such
amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may reasonably
request.
(f) Blue Sky Qualifications. The Company will use its commercially
reasonable efforts, in cooperation with the Underwriters, to qualify the
Securities for offering and sale under the applicable securities laws of such
states and other jurisdictions as the Representative may reasonably designate
and to maintain such qualifications in effect for a period of not less than one
year from the later of the effective date of the Registration Statement and any
Rule 462(b) Registration Statement; provided, however, that the Company shall
not be obligated to file any general consent to service of process or to qualify
as a foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject.
16
(g) Rule 158. The Company will timely file such reports pursuant to the
Securities Exchange Act of 1934 (the "1934 Act") as are necessary in order to
make generally available to its securityholders as soon as practicable an
earnings statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds."
(i) Listing. The Company will use its commercially reasonable efforts to
effect the listing of the IDSs on the American Stock Exchange.
(j) Restriction on Sale of Securities. Other than the sale of Securities
hereunder, during a period of 180 days from the date of the Prospectus (the
"Lock-Up Period"), the Company will not, without the prior written consent of
Xxxxxxx Xxxxx, (i) directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of any of the Company's IDSs, Common Stock, Note Securities or any
similar securities or any securities convertible into or exercisable or
exchangeable for IDSs, Common Stock, Note Securities or any similar securities
or file any registration statement under the 1933 Act with respect to any of the
foregoing (collectively, the "Lock-Up Securities") or (ii) enter into any swap
or any other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of the Lock-Up
Securities, whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of IDSs, common stock, debt securities or any
similar securities, in cash or otherwise. [Anything to the contrary
notwithstanding, the foregoing restrictions shall not apply to any securities
issued by the Company during the Lock-Up Period pursuant to any employee equity
participation plan referred to in the Prospectus or securities issued by the
Company during the Lock-Up Period upon the exercise of any option, warrant or
other right outstanding on the date hereof and issued under any such plan;
provided, however, that the recipient of such securities shall provide Xxxxxxx
Xxxxx with an agreement substantially in the form of Exhibit C hereto signed by
such recipient.]
(k) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file all
documents required to be filed with the Commission pursuant to the 1934 Act
within the time periods required by the 1934 Act and the rules and regulations
of the Commission thereunder.
(l) DTC. The Company shall cooperate with the Representative and use its
commercially reasonable efforts to permit the Securities to be eligible for
clearance and settlement through the facilities of The Depositary Trust Company.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
Agreement, any Agreement among Underwriters and such other documents as may be
required in con-
17
nection with the offering, purchase, sale, issuance or delivery of the
Securities, (iii) the preparation, issuance and delivery of the certificates for
the Securities to the Underwriters, including any stock or other transfer taxes
and any stamp or other duties payable upon the sale, issuance or delivery of the
Securities to the Underwriters and any charges of DTC in connection therewith,
(iv) the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) the qualification of the Securities under securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of the Blue Sky
Survey and any supplement thereto, (vi) the printing and delivery to the
Underwriters of copies of each preliminary prospectus and of the Prospectus and
any amendments or supplements thereto, (vii) the preparation, printing and
delivery to the Underwriters of copies of the Blue Sky Survey and any supplement
thereto, (viii) the fees and expenses of any transfer agent or registrar for the
Securities, (ix) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the Securities, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged with the prior consent of the Company in connection with the
road show presentations, travel and lodging expenses of the representatives and
officers of the Company and any such consultants, and the cost of aircraft and
other transportation chartered in connection with the road show, (x) the filing
fees incident to, and the reasonable and documented fees and disbursements of
counsel to the Underwriters in connection with, solely to the extent related to
the review by the NASD of the terms of the sale of the Securities, (xi) the fees
and expenses incurred in connection with the listing of the Initial Securities
and the Option Securities on the American Stock Exchange, (xii) the fees and
expenses of the Trustee, including the fees and disbursements of counsel for the
Trustee in connection with the Indenture and the Securities, (xiii) any fees
payable in connection with the rating of the Securities and (xiv) all costs
associated with the perfection and maintenance of the security interests to be
obtained under the Indenture and the Collateral Documents.
(b) Termination of Agreement. If this Agreement is terminated by the
Representative in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable and documented fees and
disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any subsidiary of the Company
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, shall have become effective,
and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A prospectus
containing the Rule
18
430A Information shall have been filed with the Commission in accordance with
Rule 424(b) (or a post-effective amendment providing such information shall have
been filed and declared effective in accordance with the requirements of Rule
430A).
(b) Opinion of Counsel for Company. At Closing Time, the Representative
shall have received the favorable opinion, dated as of Closing Time, of Mayer,
Brown, Xxxx & Maw LLP, counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect set forth
in Exhibit A hereto.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxx Xxxxxx & Xxxxxxx LLP, counsel for the Underwriters, together
with signed or reproduced copies of such letter for each of the other
Underwriters with respect to matters satisfactory to the Representative,
including the penultimate paragraph of Exhibit A hereto. In giving such opinion
such counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York, the federal law of the United
States and the General Corporation Law of the State of Delaware, upon the
opinions of counsel satisfactory to the Representative. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
its subsidiaries and certificates of public officials.
(d) Opinion of Tax Counsel for Company. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Mayer, Brown, Xxxx & Maw LLP, tax counsel for the Company, in form and
substance reasonably satisfactory to counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters to
the effect set forth in Exhibit B hereto.
(e) Opinion of Tax Counsel for Underwriters. At Closing Time, the
Representative shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxx Xxxxxx & Xxxxxxx LLP, tax counsel for the underwriters, in form
and substance satisfactory to the Representative.
(f) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representative shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of
Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Section 1(a) hereof are true
and correct with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or, to their knowledge, contemplated by the
Commission.
19
(g) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Representative shall have received from Ernst & Young LLP a
letter dated such date, in form and substance reasonably satisfactory to the
Representative, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(h) Bring-down Comfort Letter. At Closing Time, the Representative shall
have received from Ernst & Young LLP a letter, dated as of Closing Time, to the
effect that they reaffirm the statements made in the letter furnished pursuant
to subsection (g) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.
(i) Approval of Listing. At Closing Time, the Initial Securities and
Option Securities shall have been approved for listing on the American Stock
Exchange, subject only to official notice of issuance.
(j) No Objection. The NASD shall have confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(k) Lock-up Agreements. At the date of this Agreement, the Representative
shall have received an agreement substantially in the form of Exhibit C hereto
signed by the persons listed on Schedule C hereto.
(l) Indenture. At Closing Time, the Representative shall have received the
Indenture, in form and substance reasonably satisfactory to the Representative
and counsel for the Underwriters, executed by the Company and the Trustee, and
such agreement shall be in full force and effect.
(m) Related Transaction Documents. At Closing Time, the Representative
shall have received each of the Related Transaction Documents and such related
Transaction Documents shall be executed by the Company and each of the other
parties thereto shall be in full force and effect, and shall be consistent in
all material respects with any descriptions thereof in the Registration
Statement or the Prospectus.
(n) Related Transactions. At the Closing Time, the Related Transactions
shall have been consummated on terms and conditions consistent in all material
respects with the descriptions thereof in the Registration Statement or the
Prospectus.
(o) Perfection Certificate and Security Interests. At the Closing Time,
the Representative shall have received a perfection certificate, substantially
in the form of Exhibit D hereto, duly completed and executed by the Company and
Laundry Corp. In accordance with the terms of the Collateral Documents, the
Representative and the Collateral Agent shall have received each of the
following documents, which shall be in form and substance reasonably
satisfactory to the Representative, the Collateral Agent and each of their
respective counsel, with respect to the Collateral:
20
(i) Lien Searches. UCC, judgment and tax lien searches confirming
that the personal property comprising part of the Collateral is subject to
no liens other than those permitted by the Indenture and the Collateral
Documents.
(ii) Intercompany Note and Intercompany Note Guarantees. The
Intercompany Note duly executed by Coinmach Corp. and the Intercompany
Note Guarantees duly executed by each of the Intercompany Note Guarantors,
and such agreements shall be in full force and effect.
(iii) Security Agreement and Pledge Agreement. The Security
Agreement and Pledge Agreement duly executed by the Company, Laundry Corp.
and the Collateral Agent, and each such agreement shall be in full force
and effect.
(iv) Financing Statements. UCC-1 financing statements naming the
Company and Laundry Corp. as debtors and the Collateral Agent as secured
party.
(p) Maintenance of Rating. At the Closing Time, the Notes shall be rated
by Xxxxx'x and/or by S&P, and the Company shall have delivered to the
Representative a letter from such rating agency (or other evidence satisfactory
to the Representative) confirming that the Notes have ratings; and since the
date of this Agreement, there shall not have occurred a downgrading in the
rating assigned to the Notes or any of the Company's other debt securities by
any "nationally recognized statistical rating agency," as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the 1933 Act, and no such
securities rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of the
Notes or any of the Company's other debt securities.
(q) DTC. The Securities shall be eligible for clearance and settlement
through DTC.
(r) Preferred Stock. At the Closing Time, Laundry Corp. shall have
redeemed (i) all of its outstanding Class A Preferred Stock and (ii) $[ ]
million of its outstanding Class B Preferred Stock.
(s) Credit Facility. At the Closing Time, the amendment to the Credit
Facility described under "Description of Certain Indebtedness" in the Prospectus
shall have become effective on terms and conditions satisfactory to the
Representative.
(t) Coinmach Corp.'s 9% Senior Notes. At the Closing Time, Coinmach Corp.
shall have delivered an irrevocable notice of redemption to the trustee under
the indenture dated January 25, 2002 governing Coinmach Corp.'s 9% Senior Notes
due 2010 (the "Existing Notes") pursuant to which Coinmach Corp. shall redeem
Existing Notes in an aggregate principal amount equal to the lesser of (i) 35%
of the principal of amount of the Existing Notes issued under the indenture
governing the Existing Notes and (ii) the net proceeds from the sale and
issuance of the Securities hereunder and contributed to the capital of Coinmach
Corp.
(u) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company contained herein and the statements
21
in any certificates furnished by the Company or any subsidiary of the Company
hereunder shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Representative shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company confirming that
the certificate delivered at the Closing Time pursuant to Section 5(f)
hereof remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of Mayer,
Brown, Xxxx & Maw LLP, counsel for the Company, in form and substance
reasonably satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion required
by Section 5(b) hereof.
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
Xxxxxx Xxxxxx & Xxxxxxx llp, counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion required
by Section 5(c) hereof.
(iv) Opinion of Tax Counsel for Company. The favorable opinion of
Mayer, Brown, Xxxx & Maw LLP, tax counsel for the Company, in form and
substance reasonably satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(d) hereof.
(v) Opinion of Tax Counsel for Underwriters. The favorable opinion
of Xxxxxx Xxxxxx & Xxxxxxx llp, tax counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(e) hereof.
(vi) Bring-down Comfort Letter. A letter from Ernst & Young LLP, in
form and substance satisfactory to the Representative and dated such Date
of Delivery, substantially in the same form and substance as the letter
furnished to the Representative pursuant to Section 5(h) hereof, except
that the "specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to such Date of
Delivery.
(v) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be reasonably satisfactory in form and substance to
the Representative and counsel for the Underwriters.
22
(w) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities, on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representative by notice to the Company at
any time at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. Each of the Company and Laundry Corp.
agrees to indemnify and hold harmless each Underwriter, its affiliates, as such
term is defined in Rule 501(b) under the 1933 Act (each, an "Affiliate"), its
selling agents and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
or the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of
the Company;
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Xxxxxxx Xxxxx), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Xxxxxxx Xxxxx expressly for use in the Regis-
23
tration Statement (or any amendment thereto), including the Rule 430A
Information or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto); provided, further, that the foregoing indemnity agreement
with respect to any preliminary prospectuses shall not inure to the benefit of
any Underwriter, it Affiliates, its selling agents and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, from whom the person asserting any such loss,
liability, claim, damage or expense purchased Securities, or any person
controlling such Underwriter, if it shall be established that a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Underwriter to such person, if required by law so to have been delivered,
at or prior to the written confirmation of the sale of the Securities to such
person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such loss, liability, claim damage or expense and if
the Company had previously furnished copies thereof to such Underwriter in the
quantities reasonably requested by such Underwriter. This indemnity agreement
will be in addition to any liability which the Company may otherwise have.
(b) Indemnification of Company, Directors and Officers. Each Underwriter
severally agrees to indemnify and hold harmless each of the Company and Laundry
Corp., its respective directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement (or any amendment thereto),
including the Rule 430A Information or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through Xxxxxxx Xxxxx expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any inves-
24
tigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) Settlement Without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and Laundry
Corp. on the one hand and the Underwriters on the other hand from the offering
of the Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and Laundry Corp. on the one
hand and of the Underwriters on the other hand in connection with the statements
or omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and Laundry Corp. on the one
hand and the Underwriters on the other hand in connection with the offering of
the Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and Laundry Corp. and the total underwriting discount received by
the Underwriters, in each case as set forth on the cover of the Prospectus, bear
to the aggregate initial public offering price of the Securities as set forth on
the cover of the Prospectus.
The relative fault of the Company and Laundry Corp. on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company and Laundry Corp. or by the Underwriters and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
25
The Company, Laundry Corp. and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities 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 any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and each Underwriter's Affiliates and selling agents shall have the
same rights to contribution as such Underwriter, and each director of the
Company and Laundry Corp., each officer of the Company and Laundry Corp. who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company and Laundry
Corp. The Underwriters' respective obligations to contribute pursuant to this
Section are several in proportion to the number of Initial Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect regardless
of (i) any investigation made by or on behalf of any Underwriter or its
Affiliates or selling agents, any person controlling any Underwriter, its
officers or directors or any person controlling the Company and (ii) delivery of
and payment for the Securities.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representative may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business, or
(ii) if there has occurred any material adverse change in the financial markets
in the United States or the interna-
26
tional financial markets, any outbreak of hostilities or escalation thereof or
other calamity or crisis or any change or development involving a prospective
change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of the
Representative, impracticable or inadvisable to market the Securities or to
enforce contracts for the sale of the Securities, or (iii) if trading in any
securities of the Company has been suspended or materially limited by the
Commission, the NASD or the American Stock Exchange, or if trading generally on
the American Stock Exchange or the New York Stock Exchange or in the Nasdaq
National Market has been suspended or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been
required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) a material disruption has occurred in commercial
banking or securities settlement or clearance services in the United States, or
(v) if a banking moratorium has been declared by either Federal or New York
authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representative shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representative shall not have completed
such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number
of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a
27
termination of the obligation of the Underwriters to purchase and the Company to
sell the relevant Option Securities, as the case may be, either the
Representative or the Company shall have the right to postpone Closing Time or
the relevant Date of Delivery, as the case may be, for a period not exceeding
seven days in order to effect any required changes in the Registration Statement
or Prospectus or in any other documents or arrangements. As used herein, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section 10.
SECTION 11. Tax Disclosure. Notwithstanding any other provision of this
Agreement, from the commencement of discussions with respect to the transactions
contemplated hereby, the Company (and each employee, representative or other
agent of the Company) may disclose to any and all persons, without limitation of
any kind, the tax treatment and tax structure (as such terms are used in
Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations
promulgated thereunder) of the transactions contemplated by this Agreement and
all materials of any kind (including opinions or other tax analyses) that are
provided relating to such tax treatment and tax structure.
SECTION 12. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representative at 0 Xxxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of Equity Capital Markets, with a
copy to Xxxxxx Xxxxxx & Xxxxxxx llp, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
attention of Xxxxxxx X. Xxxxxxxx, Esq.; and notices to the Company shall be
directed to it at 000 Xxxxxxxxx Xxxx., Xxxxx 00, Xxxxxxxxx, Xxx Xxxx 00000,
attention of Xxxxxx X. Xxxxx, with a copy to Mayer, Brown, Xxxx & Maw LLP, 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of Xxxxxx X. Xxxxx, Esq.
SECTION 13. Parties. This Agreement shall each inure to the benefit of and
be binding upon the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 15. TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT
AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY
TIME.
28
SECTION 16. Counterparts. This Agreement may be executed 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 Agreement.
SECTION 17. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
29
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Company and Laundry Corp. in accordance with
its terms.
Very truly yours,
COINMACH SERVICE CORP.
By:
------------------------------------
Name:
Title:
COINMACH LAUNDRY CORPORATION
By:
------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
------------------------------------
Authorized Signatory
For itself and as Representative of the other Underwriters named in
Schedule A hereto.
S-1
SCHEDULE A
PRINCIPAL
NUMBER OF AMOUNT OF
NAME OF UNDERWRITER IDSS THIRD PARTY NOTES
------------------- ---- -----------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ....................................
Citigroup Global Markets Inc. ...................................
Deutsche Bank Securities Inc. ...................................
Xxxxxxxxx & Company, Inc. .......................................
RBC Capital Markets Corporation .................................
Suntrust Capital Markets, Inc. ..................................
Total................................................... $
========== =====================
Sch A-1
SCHEDULE B
COINMACH SERVICES CORP.
[ ] INCOME DEPOSIT SECURITIES
(REPRESENTING ONE SHARE OF CLASS A COMMON STOCK,
PAR VALUE $0.01 PER SHARE, AND $[ ] PRINCIPAL AMOUNT OF [ ]%
SENIOR SECURED NOTES DUE 2024)
AND
$[ ] AGGREGATE PRINCIPAL AMOUNT OF [ ]%
SENIOR SECURED NOTES DUE 2024
1. The initial public offering price per IDS, determined as provided in
Section 2, shall be $[ ].
2. The purchase price per IDS to be paid by the several Underwriters shall
be $[ ], being an amount equal to the initial public offering price set forth
above less $[ ] per unit; provided that the purchase price per unit for any
Option Securities purchased upon the exercise of the over-allotment option
described in Section 2(b) shall be reduced by an amount per unit equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities.
3. The initial public offering price of the Third Party Notes shall be [ ]
% of the principal amount thereof, plus accrued interest, if any from the date
of issuance.
4. The purchase price to be paid by the several Underwriters shall be [ ]
% of the principal amount thereof.
5. The interest rate on the Third Party Notes shall be [ ]% per annum.
Sch B-1
SCHEDULE C
LIST OF PERSONS AND ENTITIES
SUBJECT TO LOCK-UP AGREEMENTS
Coinmach Holdings, LLC
Sch C-1
SCHEDULE D
LIST OF RELATED TRANSACTION DOCUMENTS
(1) The Security Agreement, the Pledge Agreement and related Financing
Statements and Perfection Certificate;
(2) The Intercreditor Agreement;
(3) The Amendment to the Credit Facility;
(4) The redemption notices relating to the Coinmach Corp. 9% Notes;
(5) The Redemption Agreement among Holdings' members; and
(6) The Purchase Agreement relating to the Company's Class B Common Stock.
Sch D-1
