EXHIBIT 1
_________ Shares
EASTERN ENVIRONMENTAL SERVICES, INC.
Common Stock
UNDERWRITING AGREEMENT
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, 1997
XXXXX XXXXXX INC.
XXXXXXXXXXX & CO., INC.
XXXXXXX XXXXXX XXXXX
PACIFIC GROWTH EQUITIES, INC.
XXX XXXXXX & COMPANY
As Representatives of the Several Underwriters
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Eastern Environmental Services, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell an aggregate of 4,500,000 shares ("Firm
Shares") of its common stock, $0.01 par value per share (the "Common Stock"), to
the several Underwriters named in Schedule I hereto (the "Underwriters"). The
Company also proposes to sell to the Underwriters, upon the terms and conditions
set forth in Section 2 hereof, up to an additional 675,000 shares (the
"Additional Shares") of Common Stock. The Firm Shares and, to the extent such
Additional Shares are issued, the Additional Shares are hereinafter collectively
referred to as the "Shares".
The Company has implemented an aggressive acquisition program in the waste
management industry. As a consequence, the Company is continually reviewing
acquisition opportunities and is in various stages of negotiations with certain
solid waste collection, transportation and disposal operations. Any company
whose stock or assets is proposed to be acquired by the Company pursuant to a
signed, definitive acquisition agreement is hereinafter referred to as an
"Acquiree Company."
The Company wishes to confirm as follows its agreement with you (the
"Representatives") and the other several Underwriters on whose behalf you are
acting, in connection with the several purchases of the Shares by the
Underwriters.
1. Registration Statement and Prospectus. The Company has prepared and
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filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-3 under the Act, including a
prospectus subject to completion relating to the Shares. The term "Registration
Statement" as used in this Agreement means such registration statement
(including all financial schedules and exhibits), as amended at the time it
becomes effective, or, if such registration statement became effective prior to
the execution of this Agreement, as supplemented or amended prior to the
execution of this Agreement. If it is contemplated, at the time this Agreement
is executed, that a post-effective amendment to the registration statement will
be filed and must be declared effective before the offering of the Shares may
commence, the term "Registration Statement" as used in this Agreement means the
registration statement as amended by said post-effective amendment. The term
"Prospectus" as used in this Agreement means the prospectus in the form included
in the Registration Statement, or, if the prospectus included in the
Registration Statement omits information in reliance on Rule 430A under the Act
and such information is included in a prospectus filed with the Commission
pursuant to Rule 424(b) under the Act, the term "Prospectus" as used in this
Agreement means the prospectus in the form included in the Registration
Statement as supplemented by the addition of the Rule 430A information contained
in the prospectus filed with the Commission pursuant to Rule 424(b). The term
"Prepricing Prospectus" as used in this Agreement means the prospectus subject
to completion in the form included in the registration statement at the time of
the initial filing of the registration statement with the Commission, and as
such prospectus shall have been amended from time to time prior to the date of
the Prospectus. Any reference in this Agreement to the registration statement,
the Registration Statement, any Prepricing Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of the
registration statement, the Registration Statement, such Prepricing Prospectus
or the Prospectus, as the case may be, and any reference to any amendment or
supplement to the registration statement, the Registration Statement, any
Prepricing Prospectus or the Prospectus shall be deemed to refer to and include
any documents filed after such date under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") which, upon filing, are incorporated by
reference therein, as required by paragraph (b) or Item 12 of Form S-3. As used
herein, the term "Incorporated Documents" means the documents which at the time
are incorporated by reference in the registration statement, the Registration
Statement, any Prepricing Prospectus, the Prospectus, or any amendment or
supplement thereto.
2. Agreements to Sell and Purchase. Subject to such adjustments as you
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may determine in order to avoid fractional shares, the Company hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
each Underwriter and, upon the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the
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terms and conditions set forth herein, each Underwriter agrees, severally and
not jointly, to purchase from the Company, at a purchase price of $_____ per
Share (the "purchase price per share"), the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto (or such number of
Firm Shares increased as set forth in Section 10 hereof).
The Company also agrees, subject to all the terms and conditions set forth
herein, to sell to the Underwriters, and, upon the basis of the representations,
warranties and agreements of the Company herein contained and subject to all the
terms and conditions set forth herein, the Underwriters shall have the right to
purchase from the Company, at the purchase price per share, pursuant to an
option (the "over-allotment option") which may be exercised at any time and from
time to time prior to 9:00 P.M., New York City time, on the 30th day after the
date of the Prospectus (or, if such 30th day shall be a Saturday or Sunday or a
holiday, on the next business day thereafter when the New York Stock Exchange is
open for trading), up to an aggregate of 675,000 Additional Shares from the
Company. Additional Shares may be purchased only for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. Upon
any exercise of the over-allotment option, each Underwriter, severally and not
jointly, agrees to purchase from the Company the number of Additional Shares
(subject to such adjustments as you may determine in order to avoid fractional
shares) which bears the same proportion to the aggregate number of Additional
Shares to be purchased by the Underwriters as the number of Firm Shares set
forth opposite the name of such Underwriter in Schedule I hereto (or such number
of Firm Shares increased as set forth in Section 10 hereof) bears to the
aggregate number of Firm Shares.
3. Terms of Public Offering. The Company has been advised by you that the
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Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable and initially to offer the
Shares upon the terms set forth in the Prospectus.
4. Delivery of the Shares and Payment Therefor. Subject to Section 8
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hereof, delivery to the Underwriters of and payment by the Underwriters for the
Firm Shares shall be made at the office of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New York City time, on
, 1997 (the "Closing Date"). The place of closing for the Firm Shares and the
Closing Date may be varied by agreement between you and the Company.
Subject to Section 8 hereof, delivery to the Underwriters of and payment
for any Additional Shares to be purchased by the Underwriters shall be made at
the aforementioned office of Xxxxx Xxxxxx Inc. at such time on such date (the
"Option Closing Date"), which may be the same as the Closing Date but shall in
no event be earlier than the Closing Date nor earlier than two nor later than
ten business days after the giving of the notice hereinafter referred to, as
shall be specified in a written notice from you on behalf of the Underwriters to
the Company of the Underwriters' determination to purchase a number, specified
in such notice, of Additional Shares. The place of closing for any Additional
Shares and the Option Closing Date for such Shares may be varied by agreement
between you and the Company.
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Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 9:30 A.M., New York City time, on the second
business day preceding the Closing Date or any Option Closing Date, as the case
may be. Such certificates shall be made available to you in New York City for
inspection and packaging not later than 9:30 A.M., New York City time, on the
business day next preceding the Closing Date or the Option Closing Date, as the
case may be. The certificates evidencing the Firm Shares and any Additional
Shares to be purchased hereunder shall be delivered to you on the Closing Date
or the Option Closing Date, as the case may be, against payment of the purchase
price therefor in immediately available funds.
5. Agreements of the Company. The Company agrees with the several
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Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
Company will endeavor to cause the Registration Statement or such post-effective
amendment to become effective as soon as possible and will advise you promptly
and, if requested by you, will confirm such advice in writing, when the
Registration Statement or such post-effective amendment has become effective.
(b) The Company will advise you promptly and, if requested by you,
will confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prepricing
Prospectus or the Prospectus or for additional information; (ii) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in paragraph (f)
below, of any change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of the happening
of any event or any new information, which makes any statement of a material
fact made in the Registration Statement or the Prospectus (as then amended or
supplemented) untrue or which requires the making of any additions to or changes
in the Registration Statement or the Prospectus (as then amended or
supplemented) in order to state a material fact required by the Act to be stated
therein or necessary in order to make the statements therein not misleading, or
of the necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Act or any other law. In addition, the Company
shall advise you promptly of any agreement in principle, whether or not reduced
to writing, or any definitive agreement looking to the acquisition or
disposition of any assets or business. If at any time the Commission shall issue
any stop order suspending the effectiveness of the Registration Statement, the
Company will make every reasonable effort to obtain the withdrawal of such order
at the earliest possible time.
(c) The Company will furnish to you, without charge, (i) six signed
copies of the registration statement as originally filed with the Commission and
of each amendment thereto, including financial statements and all exhibits
thereto, (ii) such number of conformed copies of the
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registration statement as originally filed and of each amendment thereto, but
without exhibits, as you may request, (iii) such number of copies of the
Incorporated Documents, without exhibits, as you may request, and (iv) six
copies of the exhibits to the Incorporated Documents.
(d) The Company will not (i) file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus or make any
amendment or supplement to the Prospectus or, prior to the end of the period of
time referred to in the first sentence in subsection (f) below, file any
document which, upon filing becomes an Incorporated Document, of which you shall
not previously have been advised in writing or to which, after you shall have
received a copy of the document proposed to be filed, you shall object.
(e) Prior to the execution and delivery of this Agreement, the
Company has delivered to you, without charge, in such quantities as you have
requested, copies of each form of the Prepricing Prospectus. The Company
consents to the use, in accordance with the provisions of the Act and with the
securities or Blue Sky laws of the jurisdictions in which the Shares are offered
by the several Underwriters and by dealers, prior to the date of the Prospectus,
of each Prepricing Prospectus so furnished by the Company.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion of
counsel for the Underwriters a prospectus is required by the Act to be delivered
in connection with sales by any Underwriter or dealer, the Company will
expeditiously deliver to each Underwriter and each dealer, without charge, as
many copies of the Prospectus (and of any amendment or supplement thereto) as
you may request. The Company consents to the use of the Prospectus (and of any
amendment or supplement thereto) in accordance with the provisions of the Act
and with the securities or Blue Sky laws of the jurisdictions in which the
Shares are offered by the several Underwriters and by all dealers to whom Shares
may be sold, both in connection with the offering and sale of the Shares and for
such period of time thereafter as the Prospectus is required by the Act to be
delivered in connection with sales by any Underwriter or dealer. If during such
period of time any event shall occur that in the judgment of the Company or in
the opinion of counsel for the Underwriters is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus (or to file under the Exchange Act any document which, upon
filing, becomes an Incorporated Document) to comply with the Act or any other
law, the Company will forthwith promptly prepare and, subject to the provisions
of paragraph (d) above, file with the Commission an appropriate supplement or
amendment thereto (or to such document), and will expeditiously furnish to the
Underwriters and dealers a reasonable number of copies thereof. In the event
that the Company and you, as Representatives of the several Underwriters, agree
that the Prospectus should be amended or supplemented, the Company, if requested
by you, will promptly issue a press release announcing or disclosing the matters
to be covered by the proposed amendment or supplement.
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(g) The Company will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the Shares
for offering and sale by the several Underwriters and by dealers under the
securities or Blue Sky laws of such domestic and foreign jurisdictions as you
may designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such registration or
qualification; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action which would subject it to service of process in suits, other
than those arising out of the offering or sale of the Shares, in any
jurisdiction where it is not now so subject.
(h) The Company will make generally available to its security holders
a consolidated earnings statement, which need not be audited, covering a twelve-
month period commencing after the effective date of the Registration Statement
and ending not later than 15 months thereafter, as soon as practicable after the
end of such period, which consolidated earnings statement shall satisfy the
provisions of Section ll(a) of the Act.
(i) During the period of five years hereafter, the Company will
furnish to you (i) as soon as available, a copy of each report of the Company
mailed to stockholders or filed with the Commission, and (ii) from time to time
such other information concerning the Company as you may request.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 10 hereof or by notice given by you terminating this
Agreement pursuant to Section 10 or Section 11 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on the
part of the Company to comply with the terms or fulfill any of the conditions of
this Agreement, the Company agrees to reimburse the Representatives for all out-
of-pocket expenses (including fees and expenses of counsel for the Underwriters)
incurred by you in connection herewith.
(k) The Company will apply the net proceeds from the sale of the
Shares substantially in accordance with the description set forth in the
Prospectus.
(l) If Rule 430A of the Act is employed, the Company will timely file
the Prospectus pursuant to Rule 424(b) under the Act and will advise you of the
time and manner of such filing.
(m) Except as provided in this Agreement, the Company will not sell,
contract to sell or otherwise dispose of any Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock, or grant any
options or warrants to purchase Common Stock, for a period of 120 days after
the date of the Prospectus (the "120-Day Lock-Up Period"), without the prior
written consent of Xxxxx Xxxxxx Inc., except that the Company may (i) issue
shares of Common Stock ("Acquisition Shares") in connection with additional
acquisitions so long as the
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purchaser of such Acquisition Shares agrees to be bound by a lock-up letter in
the same form as those being delivered to you pursuant to paragraph (n) below
pursuant to which such purchaser agrees with the Company not to sell, offer to
sell, solicit an offer to buy, contract to sell, grant any option to purchase,
or otherwise transfer or dispose of, any such Acquisition Shares at any time
before the expiration of the 120-Day Lock-up Period and that the certificates
evidencing such Acquisition Shares shall bear a legend to such effect, and (ii)
issue shares of Common Stock pursuant to the exercise of options outstanding on
the date hereof under the Company's 1987 Stock Option Plan, 1991 Stock Option
Plan and 1996 Stock Option Plan and warrants outstanding on the date hereof, as
described in the Registration Statement. The Company further agrees for the
express benefit of the Underwriters that, during the 120-Day Lock-Up Period, it
will not, without the prior written consent of Xxxxx Xxxxxx Inc., waive any
provision of any acquisition or related agreement imposing restrictions on the
transfer or other disposition of shares of Common Stock or securities
convertible into or exercisable or exchangeable for Common Stock and will take
reasonable steps to cause its transfer agent to enforce any such provision so as
to limit the transfer or other disposition of shares of Common Stock or
securities convertible into or exercisable or exchangeable for Common Stock
during the 120-Day Lock-Up Period.
(n) The Company has furnished or will furnish to you "lock-up"
letters, signed by each of its current officers and directors in the form of
Exhibit A hereto and each stockholder designated by you in the form of Exhibit B
hereto.
(o) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, the Company has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares.
(p) The Company will cause the shares of Common Stock which it agrees
to sell under this Agreement to be listed, subject to notice of issuance, on the
Nasdaq National Market on or before the Closing Date.
(q) The Company will not file any registration statement under the
Act seeking to register any Common Stock, any options or warrants, or any other
securities convertible into or exercisable or exchangeable for Common Stock for
a period of 180 days following the Closing Date, except that the Company may (i)
file a shelf registration statement seeking to register for resale up to
5,121,805 shares of Common Stock within 15 days following the Closing Date;
provided, however that the Company shall not cause or otherwise permit such
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shelf registration statement to be declared effective at any time prior to the
45th day following the Closing Date; and (ii) file a registration statement on
Form S-8 seeking to register up to 2,500,000 shares of Common Stock which may be
obtained upon exercise of stock options granted pursuant to the Company's 1996
Stock Option Plan.
6. Representations and Warranties of the Company. The Company represents
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and warrants to each Underwriter that:
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(a) Each Prepricing Prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement thereto,
or filed pursuant to Rule 424 under the Act, complied when so filed in all
material respects with the provisions of the Act. The Commission has not issued
any order preventing or suspending the use of any Prepricing Prospectus.
(b) The Company and the transactions contemplated by this Agreement
meet the requirements for using Form S-3 under the Act. The Registration
Statement in the form in which it became or becomes effective and also in such
form as it may be when any post-effective amendment thereto shall become
effective and the Prospectus and any supplement or amendment thereto when filed
with the Commission under Rule 424(b) under the Act complied or will comply with
the provisions of the Act and did not or will not at any such times 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,
except that this representation and warranty does not apply to statements in or
omissions from the Registration Statement or the Prospectus or any amendment or
supplement thereto made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by or on behalf
of any Underwriter through you expressly for use therein.
(c) The Incorporated Documents heretofore filed, when they were filed
(or, if any amendment with respect to any such document was filed, when such
amendment was filed), conformed with the requirements of the Exchange Act and
the rules and regulations thereunder, and any further Incorporated Documents so
filed will, when they are filed, conform with the requirements of the Exchange
Act and the rules and regulations thereunder; no such document when it was
filed, (or, if an amendment with respect to any such document was filed, when
such amendment was filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and no such further
document, when it is filed, will contain an untrue statement of a material fact
or will omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading.
(d) The Company has an authorized, issued and outstanding
capitalization as set forth in the Registration Statement and the Prospectus.
All the outstanding shares of capital stock of the Company have been duly
authorized and validly issued, fully paid and nonassessable and free of and not
issued in violation of any preemptive or similar rights; the Shares to be issued
and sold by the Company have been duly authorized and, when issued and delivered
to the Underwriters against payment therefor in accordance with the terms
hereof, will be validly issued, fully paid and nonassessable and will be free of
and will not have been issued in violation of any preemptive or other rights.
Except as described in the Prospectus, (a) there are no outstanding options,
warrants or other rights calling for the issuance of, and there are no
commitments to issue any shares of, capital stock of the Company or any security
convertible into or exchangeable or exercisable for capital stock of the
Company, and (b) there is no holder of any securities of the Company or any
other person who has the right, contractual or otherwise, to cause the Company
to sell or otherwise issue to him or her, or permit him or her to underwrite the
sale of, any of the Shares. The capital
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stock of the Company conforms to the description thereof in the Registration
Statement and the Prospectus.
(e) The Company is a corporation duly organized and validly existing
in good standing under the laws of the State of Delaware with full corporate
power and authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the Prospectus, and is
duly registered and qualified to conduct its business and is in good standing in
each jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the
failure so to register or qualify does not have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries (as hereinafter defined) taken as
a whole.
(f) All the Company's subsidiaries (collectively, the "Subsidiaries")
[are identified in an exhibit to the Registration Statement] or [are listed in
an exhibit to the Company's Annual Report on Form 10-K, as amended on Form 10-
K/A, which is incorporated by reference into the Registration Statement]. Each
Subsidiary is a corporation duly organized, validly existing and in good
standing in the jurisdiction of its incorporation, with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectus, and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify does not have material adverse effect on the condition
(financial or other), business, properties, net worth or results of operations
of such Subsidiary; all the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable, and are owned by the Company free and clear of any lien, adverse
claim, security interest, equity or other encumbrance. Other than with respect
to the Subsidiaries, the Company does not have, directly or indirectly, any
ownership interest or agreement or agreement in principle to acquire any
ownership interest in any corporation, partnership, joint venture, association
or other business organization.
(g) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company, any of the
Subsidiaries or any of the Acquiree Companies or to which the Company, any of
the Subsidiaries or the Acquiree Companies, or to which any of their respective
properties, is subject that are required to be described in the Registration
Statement or the Prospectus but are not described as required, and there are no
agreements, contracts, indentures, leases or other instruments that are required
to be described in the Registration Statement or to any Incorporated Document or
the Prospectus or to be filed as an exhibit to the Registration Statement or to
any Incorporated Document that are not described or filed as required by the Act
or the Exchange Act.
(h) Neither the Company nor any of the Subsidiaries nor, to the
knowledge of the Company, any of the Acquiree Companies is in violation of its
certificate or articles of incorporation
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or by-laws, or other organizational documents, or of any statute, law,
ordinance, administrative or governmental rule or regulation applicable to the
Company, the Subsidiaries or the Acquiree Companies or of any judgment,
injunction, order or decree of any court or governmental agency or body having
jurisdiction over the Company, the Subsidiaries or the Acquiree Companies, or in
default in any material respect in the performance of any obligation, agreement
or condition contained in any bond, debenture, note or any other evidence of
indebtedness or in any material agreement, indenture, lease or other instrument
to which the Company, any of the Subsidiaries or, to the knowledge of the
Company, any of the Acquiree Companies is a party or by which any of them or any
of their respective properties may be bound.
(i) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement by the Company nor the consummation by
the Company of the transactions contemplated hereby (A) requires any consent,
approval, authorization or other order of or registration or filing with, any
court, regulatory body, administrative agency or other governmental body, agency
or official (except such as may be required for the registration of the Shares
under the Act and the Exchange Act and compliance with the securities or Blue
Sky laws of various jurisdictions, all of which have been or will be effected in
accordance with this Agreement) or conflicts or will conflict with or
constitutes or will constitute as of the date hereof and on the Closing Date and
any Option Closing Date a breach of, or a default under, the certificate or
articles of incorporation or bylaws, or other organizational documents, of the
Company, any of the Subsidiaries or, to the knowledge of the Company, any of the
Acquiree Companies or (B) conflicts or will conflict with or constitutes or will
constitute as of the date hereof and on the Closing Date and any Option Closing
Date a breach of, or a default under, any agreement, indenture, lease or other
instrument to which the Company, any of the Subsidiaries, or, to the knowledge
of the Company, any of the Acquiree Companies is a party or by which any of them
or any of their respective properties may be bound, or violates or will violate
as of the date hereof and on the Closing Date and any Option Closing Date any
statute, law, regulation or filing or judgment, injunction, order or decree
applicable to the Company, any of the Subsidiaries or, to the knowledge of the
Company, any of the Acquiree Companies or any of their respective properties, or
as of the date hereof and on the Closing Date and any Option Closing Date will
result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company, any of the Subsidiaries or, to the knowledge
of the Company, any of the Acquiree Companies pursuant to the terms of any
agreement or instrument to which any of them is a party or by which any of them
may be bound or to which any of the property or assets of any of them is
subject.
(j) All of the accountants who have certified or shall certify any of
the financial statements included or incorporated by reference in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto) are independent public accountants as required by the Act.
(k) The historical consolidated financial statements, together with
the related schedules and notes, included or incorporated by reference in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) and the supplemental consolidated financial
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statements, together with the related schedules and notes, included or
incorporated by reference in the Registration Statement and the Prospectus (and
any amendment or supplement thereto), present fairly the consolidated financial
position, results of operations, stockholders' equity (and deficit) and cash
flows of the Company and its Subsidiaries and of one or more of the Acquiree
Companies, as the case may be, on the basis stated in the Registration Statement
and in such Incorporated Document at the respective dates or for the respective
periods to which they apply. The historical financial statements, together with
the related schedules and notes, contained in each Current Report on Form 8-K,
as amended, included among the Incorporated Documents presented fairly, as of
the date of such Report, the separate financial position, results of operations,
stockholders equity (and deficit) and cash flows of the subject company on the
basis stated in such Report and for the respective periods to which they apply;
all such financial statements and related schedules and notes have been prepared
in accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved, except as disclosed
therein; and the summary and selected consolidated financial and statistical
information and data included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto) present fairly the information shown
therein and such data have been compiled on a basis consistent with the
financial statements presented therein and the books and records of the Company,
and its Subsidiaries. The pro forma consolidated financial statements of the
Company and its Subsidiaries, together with the related schedules and notes, as
set forth in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), present fairly the information shown therein, have been
prepared in accordance with the applicable provisions of Article 11 of
Regulation S-X promulgated by the Commission with respect to pro forma financial
statements and have been properly compiled on the pro forma bases described
therein and, in the opinion of the Company, the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred to
therein, and the other financial and statistical information and data included
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto) are accurately presented and prepared on a basis consistent
with such financial statements and the books and records of the Company and the
Subsidiaries.
(l) The execution and delivery of, and the performance by the Company
of its obligations under, this Agreement have been duly and validly authorized
by the Company, and this Agreement has been duly executed and delivered by the
Company and constitutes the valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except that (i)
enforceability may be subject to the effect of any applicable bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium or other laws
affecting the creditors' rights generally and general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law), and (ii) rights to indemnity and contribution hereunder may
be limited by Federal or state securities laws. The execution and delivery of,
and the performance by the Company of its obligations under, each of the
definitive acquisition agreements, if any, relating to acquisition of any of the
Acquiree Companies (collectively, the "Acquisition Agreements") have been duly
and validly authorized by the Company and each Acquisition Agreement has been
duly authorized, executed and delivered by the Company, and constitutes the
legal, valid and binding agreement of the respective parties thereto,
enforceable against them in
11
accordance with its terms, except as enforceability thereof may be subject to
the effect of (i) any applicable bankruptcy, fraudulent conveyance, insolvency,
reorganizations, moratorium or other laws affecting creditors' rights generally,
and (ii) general principles of equity (regardless of whether such enforceability
is considered in a proceeding in equity of at law).
(m) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any change in the capital
stock, or material increase in the short-term debt or long-term debt, of the
Company or any of the Subsidiaries or any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company and the
Subsidiaries taken as a whole.
(n) Each of the Company and the Subsidiaries has good and marketable
title to all property (real and personal) described in the Registration
Statement and the Prospectus or in a document filed as an exhibit to the
Registration Statement as being owned by it, free and clear of all liens,
claims, security interests or other encumbrances, except such as are described
in the Registration Statement and the Prospectus or in a document filed as an
exhibit to the Registration Statement or which are not material to the Company
and/or the applicable Subsidiary, and all the property described in the
Prospectus as being held under lease by the Company or any Subsidiary is held by
the Company or such Subsidiary under valid, subsisting and enforceable leases.
(o) The Company has not distributed and, prior to the later to occur
of (i) the Closing Date and (ii) completion of the distribution of the Shares,
will not distribute any offering material in connection with the offering and
sale of the Shares other than the Registration Statement, the Prepricing
Prospectus, the Prospectus or other materials, if any, permitted by the Act.
(p) The Company and each of the Subsidiaries has such permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("permits") as are necessary to own its respective properties and to
conduct its business in the manner described in the Prospectus, subject to such
qualifications as may be set forth in the Prospectus and except where the
failure to have such permits would not have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole; the Company and
each of the Subsidiaries has fulfilled and performed all its material
obligations with respect to such permits, licenses, franchises and
authorizations and no event has occurred which allows, or after notice or lapse
of time would allow, revocation or termination thereof or results, or after
notice or lapse of time would result, in any other material impairment of the
rights of the holder of any such permit, license, franchise or authorization,
subject in each case to such qualification as may be set forth in the
Prospectus; and, except as described in
12
the Prospectus, none of such permits, licenses, franchises or authorizations
contains any restriction that is materially burdensome to the Company or any of
the Subsidiaries.
(q) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization, (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets, (iii) access to assets is permitted only in
accordance with management's general or specific authorization, and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(r) Neither the Company nor any of its Subsidiaries nor any employee
or agent of the Company or any Subsidiary has made any payment of funds of the
Company or any Subsidiary or received or retained any funds in violation of any
statute, law, rule or regulation, which payment, receipt or retention of funds
is of a character required to be disclosed in the Prospectus.
(s) The Company and each of the Subsidiaries have filed in a timely
manner all tax returns required to be filed with any taxing authority, which
returns are complete and correct and, to the best knowledge of the Company, are
not the subject of any audit proceedings, and neither the Company nor any
Subsidiary is in default in the payment of any taxes which were payable pursuant
to said returns or any assessments with respect thereto.
(t) The Company and each of the Subsidiaries have conducted their
respective businesses in compliance with all applicable Federal, state,
provincial, foreign and local laws, regulations, orders, codes and common law
including, without limitation, those promulgated under the Resource Conservation
and Recovery Act of 1976 ("RCRA"), including the Subtitle D Regulations, the
Federal Water Pollution Control Act of 1972 (the "Clean Water Act"), the
Comprehensive Environmental Response, Compensation and Liability Act of 1980
("CERCLA"), the Clean Air Act, and the Occupational Safety and Health Act
("OSHA") and those laws, regulations, orders, codes and common law applicable to
protection of the environment, waste management and waste disposal, health and
safety (collectively, "Environmental Laws") and, to the knowledge of the
Company, under current law there are no existing circumstances that would
prevent, interfere with, or materially increase the cost of the Company's
compliance with RCRA, the Subtitle D Regulations, the Clean Water Act, CERCLA,
the Clean Water Act, OSHA or any other Environmental Laws in the future, except
for any lack of compliance or the existence of any such circumstance as would
not have, individually or in the aggregate, a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole.
(u) Except as set forth in the Registration Statement and the
Prospectus, there is no material claim under any of Environmental Law, including
common law, pending or threatened against the Company or any of the Subsidiaries
(an "Environmental Claim") and, to the Company's knowledge, there are no past or
present actions, activities, circumstances, events or incidents,
13
including, without limitation, releases of any material into the environment,
that would reasonably be expected to form the basis of any material claim
against the Company or any of the Subsidiaries or, to the knowledge of the
Company, and of the Acquiree Companies.
(v) The Company and each of the Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are customary in the businesses in which they are engaged; (ii) all
policies of insurance and fidelity or surety bonds insuring the Company or any
of its Subsidiaries or their respective businesses, assets, employees, officers
and directors are in full force and effect; (iii) the Company and its
Subsidiaries are in compliance with the terms of such policies and instruments
in all material respects; and (iv) there are no claims by the Company or any of
its Subsidiaries under any such policy or instrument as to which any insurance
company is denying liability or defending under a reservation of rights clause.
(w) Each holder of a security of the Company that has any right to
require registration of shares of Common Stock or any other security of the
Company because of the filing of the Registration Statement or consummation of
the transactions contemplated by this Agreement has been notified of the
Company's intent to file the Registration Statement with the Commission and has
agreed in writing to waive such holder's registration rights with respect to the
public offering contemplated hereby.
(x) The Company and the Subsidiaries own or possess valid and
enforceable rights to use all patents, trademarks, trademark registrations,
service marks, service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights described in the Prospectus as being owned
by them or any of them or material to the conduct of their respective
businesses, and the Company is not aware of any claim to the contrary or any
challenge by any other person or entity to the rights of the Company and the
Subsidiaries with respect to the foregoing or of any infringement by any other
person or entity with respect to the foregoing.
(y) The Company is not now, and after sale of the Shares to be sold
by it hereunder and application of the net proceeds from such sale as described
in the Prospectus under the caption "Use of Proceeds" will not be, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(z) The Shares have been approved for quotation, upon notice of
issuance, on the Nasdaq National Market.
7. Indemnification and Contribution. (a) The Company agrees to indemnify
--------------------------------
and hold harmless each of you and each other Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages, liabilities and expenses (including, without limitation, reasonable
costs of investigation and reasonable attorneys fees and expenses) arising out
of, based upon or relating to any untrue statement or alleged untrue statement
of a material fact
14
contained in the Registration Statement or in any Prepricing Prospectus or the
Prospectus or in any amendment or supplement thereto, or arising out of, based
upon or relating to any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except insofar as such losses, claims, damages, liabilities or
expenses arise out of or are based upon any untrue statement or omission of a
material fact or alleged untrue statement or omission of a material fact which
has been made therein or omitted therefrom in reliance upon and in conformity
with the information relating to such Underwriter furnished in writing to the
Company by or on behalf of any Underwriter through you expressly for use in
connection therewith; provided, however, that the indemnification contained in
this paragraph (a) with respect to any Prepricing Prospectus shall not inure to
the benefit of any Underwriter (or to the benefit of any person controlling such
Underwriter) on account of any such loss, claim, damage, liability or expense
arising from the sale of the Shares by such Underwriter to any person if a copy
of the Prospectus shall not have been delivered or sent to such person within
the time required by the Act, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in such
Prepricing Prospectus was corrected in the Prospectus, provided that the Company
has delivered the Prospectus to the several Underwriters in requisite quantity
on a timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company, such Underwriter or such
controlling person shall promptly notify the Company and the Company shall
assume the defense thereof, including the employment of counsel which shall be
of nationally recognized standing and satisfactory to Xxxxx Xxxxxx Inc. and
payment of all fees and expenses. The Company shall not agree to settle any such
action, suit or proceeding without the written consent of Xxxxx Xxxxxx Inc.,
which consent shall not be unreasonably withheld. Such Underwriter or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Company agreed in writing to pay such
fees and expenses, (ii) the Company failed promptly to assume the defense and
employ counsel, or (iii) the named parties to any such action, suit or
proceeding (including any impleaded parties) include both such Underwriter or
such controlling person and the Company and such Underwriter or such controlling
person shall have been advised by its counsel that representation of such
indemnified party and the Company by the same counsel would be inappropriate
under applicable standards of professional conduct (whether or not such
representation by the same counsel has been proposed) due to actual or potential
differing interests between them (in which case the Company shall not have the
right to assume the defense of such action, suit or proceeding on behalf of such
Underwriter or such controlling person). It is understood, however, that the
Company shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons having actual or potential
differing interests,
15
which firm shall be designated in writing by Xxxxx Xxxxxx Inc., and that all
such fees and expenses shall be reimbursed promptly as they are incurred. The
Company shall not be liable for any settlement of any such action, suit or
proceeding effected without its written consent, but if settled with such
written consent, or if there be a final judgment for the plaintiff in any such
action, suit or proceeding, the Company agrees to indemnify and hold harmless
any Underwriter, to the extent provided in the preceding paragraph, and any such
controlling person from and against any loss, claim, damage, liability or
expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but only
with respect to information relating to such Underwriter furnished in writing by
or on behalf of such Underwriter expressly for use in the Registration
Statement, the Prospectus or any Prepricing Prospectus, or any amendment or
supplement thereto. If any action, suit or proceeding shall be brought against
the Company, any of its directors, any such officer, or any such controlling
person based on the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto, and in respect of which
indemnity may be sought against any Underwriter pursuant to this paragraph (c),
such Underwriter shall have the rights and duties given to the Company by
paragraph (b) above (except that if the Company shall have assumed the defense
thereof such Underwriter shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof, but the fees and
expenses of such counsel shall be at such Underwriter's expense), and the
Company, its directors, any such officer, and any such controlling person shall
have the rights and duties given to the Underwriters by paragraph (b) above. The
foregoing indemnity agreement shall be in addition to any liability which any
Underwriter may otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus; provided that, in the event that the
Underwriters shall have purchased
16
any Additional Shares hereunder, any determination of the relative benefits
received by the Company, or the Underwriters from the offering of the Shares
shall include the net proceeds (before deducting expenses) received by the
Company , and the underwriting discounts and commissions received by the
Underwriters, from the sale of such Additional Shares, in each case computed on
the basis of the respective amounts set forth in the notes to the table on the
cover page of the Prospectus. The relative fault of the Company on the one hand
and the Underwriters on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or by the Underwriters on
the other hand and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by a
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in paragraph (d) above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
any claim or defending any such action, suit or proceeding. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price of the Shares
underwritten by it and distributed to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
indemnify or contribute, as applicable, pursuant to this Section 7 are several
in proportion to the respective numbers of Firm Shares set forth opposite their
names in Schedule I hereto (or such numbers of Firm Shares increased as set
forth in Section 10 hereof) in relation to the aggregate number of Firm Shares
and not joint.
(f) No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative
17
and in full force and effect, regardless of (i) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter, the
Company, its directors or officers or any person controlling the Company, (ii)
acceptance of any Shares and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to any Underwriter or any person
controlling any Underwriter, or to the Company, its directors or officers, or
any person controlling the Company, shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
7.
8. Conditions of Underwriters' Obligations. The several obligations of
---------------------------------------
the Underwriters to purchase the Firm Shares hereunder are subject to the
following conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
registration statement or such post-effective amendment shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose shall have
been instituted or, to the knowledge of the Company or any Underwriter,
threatened by the Commission, and any request of the Commission for additional
information (to be included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting the condition (financial or other), business,
properties, net worth, or results of operations of the Company or the
Subsidiaries not contemplated by the Prospectus, which in your opinion, as
Representatives of the several Underwriters, would adversely affect the market
for the Shares, or (ii) any event or development relating to or involving the
Company, any Subsidiary, any Acquiree Company or any officer or director of the
Company or any Subsidiary, or any Acquiree Company which makes any statement
made in the Prospectus an untrue statement of a material fact or which, in the
opinion of the Company and its counsel or the Underwriters and their counsel,
requires the making of any addition to or change in the Prospectus in order to
state a material fact required by the Act or any other law to be stated therein
or necessary in order to make the statements therein not misleading, if amending
or supplementing the Prospectus to reflect such event or development would, in
your opinion, as Representatives of the several Underwriters, adversely affect
the market for the Shares.
(c) You shall have received on the Closing Date, an opinion of
Drinker Xxxxxx & Xxxxx LLP, counsel for the Company, dated the Closing Date and
addressed to you, as `Representatives of the several Underwriters, to the effect
that:
18
(i) The Company is a corporation duly incorporated and
validly existing in good standing under the laws of the State of Delaware with
full corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), and is duly qualified to
conduct its business and is in good standing in each jurisdiction or place where
the nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or
qualify does not have a material adverse effect on the condition (financial or
other), business, properties, net worth or results of operations of the Company
and the Subsidiaries taken as a whole;
(ii) Each of the Subsidiaries is a corporation duly
incorporated and validly existing in good standing under the laws of the
jurisdiction of its organization, with full corporate power and authority to
own, lease, and operate its properties and to conduct its business as described
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto) and is duly qualified to conduct its business and is in good
standing in each jurisdiction or place where the nature of its properties or the
conduct of its business requires such registration or qualification, except
where the failure so to register or qualify does not have a material adverse
effect on the condition (financial or other), business, properties, net worth or
results of operations of the Company and the Subsidiaries taken as a whole; and
all the outstanding shares of capital stock of each of the Subsidiaries have
been duly authorized and validly issued, are fully paid and nonassessable, and,
except as otherwise set forth in the Prospectus, are owned by the Company, free
and clear of any security interest, lien, adverse claim, equity or other
encumbrance;
(iii) The authorized and outstanding capital stock of the
Company is as set forth under the caption "Capitalization" in the Prospectus;
and the authorized capital stock of the Company conforms in all material
respects as to legal matters to the description thereof contained in the
Prospectus under the caption "Description of Capital Stock";
(iv) All the shares of capital stock of the Company
outstanding prior to the issuance of the Shares to be issued and sold by the
Company hereunder have been duly authorized and validly issued, and are fully
paid and nonassessable and were not issued in violation of any preemptive or
other rights of any holder of capital stock;
(v) The Shares to be issued and sold to the Underwriters by
the Company hereunder have been duly authorized and, when issued and delivered
to the Underwriters against payment therefor in accordance with the terms
hereof, will be validly issued, fully paid and nonassessable and will not have
been issued in violation of any statutory preemptive or, to the knowledge of
such counsel after reasonable inquiry, other similar rights that entitle or will
entitle any person to acquire any shares upon the issuance thereof by the
Company. No holders of capital stock of the Company are entitled to have such
securities registered under the Registration Statement which rights have not
been waived;
19
(vi) The form of certificates for the Shares conforms to the
requirements of the Delaware General Corporation Law;
(vii) Based on telephonic confirmation from the Commission on
________, 1997, the Registration Statement and all post-effective amendments, if
any, have become effective under the Act and, to the knowledge of such counsel
after reasonable inquiry, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose are
pending before or contemplated by the Commission; and any required filing of the
Prospectus pursuant to Rule 424(b) has been made in accordance with Rule 424(b);
(viii) The Company has the corporate power and authority to
enter into this Agreement and to issue, sell and deliver the Shares to be sold
by it to the Underwriters as provided herein. This Agreement has been duly
authorized, executed and delivered by the Company and is a valid, legal and
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except as enforcement of rights to indemnity and contribution
hereunder may be limited by Federal or state securities laws or principles of
public policy and subject to the qualification that enforceability of the
Company's obligations hereunder may be limited by any applicable bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium or other laws
affecting the creditors' rights generally and by general principles of equity;
(ix) None of the Company, the Subsidiaries is in violation of
its certificate or articles of incorporation or bylaws, or other organizational
documents, or is in default in the performance or observance of any material
obligation, agreement or condition contained in any bond, debenture, note or
other evidence of indebtedness, or other material agreement, lease or instrument
that is filed as an exhibit to the Registration Statement, except as may be
disclosed in the Prospectus;
(x) Neither the issuance, offer, sale or delivery of the
Shares, the execution, delivery or performance of this Agreement, compliance by
the Company with the provisions hereof, nor consummation by the Company of the
transactions contemplated hereby conflicts or will conflict with or constitutes
or will constitute a breach of, or a default under, the certificate or articles
of incorporation or bylaws, or other organizational documents, of the Company or
any of the Subsidiaries or any agreement, indenture, lease or other instrument
to which the Company or any of the Subsidiaries is a party or by which any of
them or any of their respective properties is bound which has been described in
or filed as an exhibit to the Registration Statement or to an Incorporated
Document, or is known to such counsel after reasonable inquiry, or will result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of the Subsidiaries, nor (assuming
compliance with all applicable state or foreign securities and Blue Sky laws)
will any such action result in any violation of any existing statute, law, rule,
regulation, ruling, judgment, injunction, order or decree applicable to the
Company, the Subsidiaries, or any of their respective properties;
20
(xi) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or official is required on the part of the
Company (except as have been obtained under the Act and the Exchange Act or such
as may be required under state or foreign securities or Blue Sky laws governing
the purchase and distribution of the Shares) for the valid issuance and sale of
the Shares to the Underwriters as contemplated by this Agreement;
(xii) The Registration Statement and the Prospectus and any
supplements or amendments thereto (except for the financial statements and the
notes thereto and the schedules and other financial and statistical data
included therein, as to which such counsel need not express any opinion) comply
as to form in all material respects with the requirements of the Act; and each
of the Incorporated Documents (except for the financial statements and the notes
thereto and the schedules and other financial and statistical data included
therein, as to which counsel need not express any opinion) complies as to form
in all material respects with the Exchange Act and the rules and regulations of
the Commission thereunder;
(xiii) (A) Other than as described in the Prospectus (or any
amendment or supplement thereto), there are no legal or governmental proceedings
pending or, to the knowledge of such counsel after reasonable inquiry threatened
against the Company or any of the Subsidiaries, or to which the Company or any
of the Subsidiaries, or any of their property, is subject which are required to
be described in the Registration Statement or Prospectus (or any amendment or
supplement thereto), (B) there are no agreements, contracts, indentures, leases
or other instruments that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) or to be
filed as an exhibit to the Registration Statement or to an Incorporated
Document, as the case may be, that are not described or filed as required and
(C) other than as described in the Prospectus (or any amendment or supplement
thereto), there are no outstanding options, warrants or other rights calling for
the issuance of, and such counsel knows of no commitment, plan or arrangement to
issue any share of capital stock of the Company or any security convertible into
or exercisable or exchangeable for capital stock of the Company or of any
Subsidiary;
(xiv) To the knowledge of such counsel after reasonable
inquiry, neither the Company nor any of the Subsidiaries is in violation of any
statute, law, ordinance, administrative or governmental rule or regulation
applicable to the Company or any of the Subsidiaries or of any judgment,
injunction, order or decree of any court or governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries;
(xv) The statements in the Registration Statement and
Prospectus (including in the Incorporated Documents), insofar as they are
descriptions of contracts, agreements, instruments or other legal documents, or
refer to statements of law or legal conclusions, are accurate in all material
respects and present fairly the information required to be shown;
21
(xvi) Upon delivery of the Shares pursuant to this Agreement
and payment therefor as contemplated herein the Underwriters will acquire good
and marketable title to the Shares free and clear of any lien, claim, security
interest, or other encumbrance, restriction on transfer or other defect in
title;
(xvii) The Shares, subject to official notice of issuance, have
been approved for listing on the Nasdaq National Market; and
(xviii) The Company is not an "investment company" or a person
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
In addition, such counsel shall state that although such counsel has not
undertaken to determine independently, and does not assume any responsibility
for, the accuracy or completeness of the statements in the Registration
Statement, such counsel has participated in conferences with officers and other
representatives of the Company and its Subsidiaries, representatives of the
independent public accountants of the Company and representatives of the
Underwriters at which the contents of the Registration Statement and the
Prospectus (including the Incorporated Documents) and related matters were
reviewed and discussed, and participated in the preparation of the Registration
Statement and the Prospectus and nothing has come to the attention of such
counsel that has caused such counsel to believe that the Registration Statement
(including the Incorporated Documents) at the time the Registration Statement
became effective, or the Prospectus, as of its date and as of the Closing Date
or the Option Closing Date, as the case may be, contained an untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that any amendment
or supplement to the Prospectus, as of its respective date, and as of the
Closing Date or the Option Closing Date, as the case may be, contained any
untrue statement of a material fact or omitted 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 (it being understood
that such counsel need express no opinion with respect to the financial
statements and the notes thereto and the schedules and other financial and
statistical data included in the Registration Statement or the Prospectus or any
Incorporated Document).
In rendering such opinion as aforesaid, counsel may rely upon an opinion or
opinions, each dated the Closing Date, of other counsel retained by them or the
Company as to laws of any jurisdiction other than the United States, the State
of New York, the State of New Jersey or the Commonwealth of Pennsylvania or the
General Corporation Law of Delaware, provided that (1) each such local counsel
is acceptable to the Representatives, (2) such reliance is expressly authorized
by each opinion so relied upon and a copy of each such opinion is addressed and
delivered to the Representatives and is in form and substance satisfactory to
them and their counsel, and (3) counsel shall state in their opinion that they
believe that he and the Underwriters are justified in relying thereon.
22
(d) You shall have received on the Closing Date, an opinion of Xxxxxx X.
Xxxxxx, Esq., corporate counsel for the Company, dated the Closing Date and
addressed to you, as Representatives of the several Underwriters, to the effect
that:
(i) The Company and each of the Subsidiaries has full corporate
power and authority, and all necessary governmental authorizations, approvals,
orders, licenses, certificates, franchises and permits of and from all
governmental regulatory officials and bodies (except where the failure so to
have any such authorizations, approvals, orders, licenses, certificates,
franchises or permits, individually or in the aggregate, would not have a
material adverse effect on the condition (financial or other), business,
properties, net worth or results of operations of the Company and the
Subsidiaries taken as a whole, to own their respective properties and to conduct
their respective businesses as now being conducted, as described in the
Prospectus;
(ii) Except as disclosed in the Prospectus, the Company owns of
record, all the outstanding shares of capital stock of each of the Subsidiaries
free and clear of any lien, adverse claim, security interest, equity, or other
encumbrance;
(iii) Other than as described or contemplated in the Prospectus (or
any supplement thereto), there are no legal or governmental proceedings pending
or threatened against the Company or any of the Subsidiaries, or to which the
Company or any of the Subsidiaries or any of their property, is subject, which
are required to be described in the Registration Statement or Prospectus (or any
amendment or supplement thereto);
(iv) There are no agreements, contracts, indentures, leases or
other instruments that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) or to be
filed as an exhibit to the Registration Statement or any Incorporated Document
that are not described or filed as required, as the case may be;
(v) The Company and the Subsidiaries own all patents, trademarks,
trademark registrations, service marks, service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets and rights described in the
Prospectus as being owned by them or any of them or necessary for the conduct of
their respective businesses, and such counsel is not aware of any claim to the
contrary or any challenge by any other person to the rights of the Company and
the Subsidiaries with respect to the foregoing;
(vi) Neither the Company nor any of the Subsidiaries is in
violation of any law, ordinance, administrative or governmental rule or
regulation applicable to the Company or any of the Subsidiaries or of any decree
of any court or governmental agency or body having jurisdiction over the Company
or any of the Subsidiaries;
(vii) Except as described in the Prospectus, there are no
outstanding options, warrants or other rights calling for the issuance of, and
such counsel does not know of any
23
commitment, plan or arrangement to issue, any shares of capital stock of the
Company or any security convertible into or exchangeable or exercisable for
capital stock of the Company; and
(viii) Except as described in the Prospectus, there is no holder of
any security of the Company or any other person who has the right, contractual
or otherwise, to cause the Company to sell or otherwise issue to them, or to
permit them to underwrite the sale of, the Shares or the right to have any
Common Stock or other securities of the Company included in the registration
statement or the right, as a result of the filing of the registration statement,
to require registration under the Act of any shares of Common Stock or other
securities of the Company, which right has not been waived.
(e) You shall have received on the Closing Date an opinion of Xxxxxx,
Xxxxx & Xxxxxxx LLP, counsel for the Underwriters, dated the Closing Date and
addressed to you, as Representatives of the several Underwriters, with respect
to the matters referred to in the first sentence of clause (v), clause (vii),
the first sentence of (viii) and clause (xii) of the foregoing paragraph (c) and
such other related matters as you may request.
(f) You shall have received letters addressed to you, as Representatives
of the several Underwriters, and dated the date hereof and the Closing Date from
each of (i) Ernst & Young LLP, (ii) BDO Xxxxxxx, LLP, (iii) X.X. Xxxxxxx & Co.,
P.C., (iv) Bardall, Weintraub, P.C., (v) Xxxxx and Xxxxxx, CPAs, (vi)
Xxxxxxxxxxx, Xxxxxxxx & XxXxxxxxx, LLP, (vii) Serra & XxXxxxx, LLP, and (viii)
Xxxxx & Associates, each of which are independent certified public accountants,
substantially in the forms heretofore approved by you.
(g) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company or the Underwriters, shall be
contemplated by the Commission at or prior to the Closing Date; (ii) there shall
not have been any change in the capital stock of the Company nor any material
increase in the short-term or long-term debt of the Company (other than in the
ordinary course of business) from that set forth or contemplated in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto); (iii) there shall not have been, since the respective dates as of
which information is given in the Registration Statement and the Prospectus (or
any amendment or supplement thereto), except as may otherwise be stated in the
Registration Statement and Prospectus (or any amendment or supplement thereto),
any material adverse change in the condition (financial or other), business,
prospects, properties, net worth or results of operations of the Company and the
Subsidiaries taken as a whole; (iv) the Company and the Subsidiaries shall not
have any liabilities or obligations, direct or contingent (whether or not in the
ordinary course of business), that are material to the Company and the
Subsidiaries, taken as a whole, other than those reflected in the Registration
Statement or the Prospectus (or any amendment or supplement thereto); and (v)
all the representations and warranties of the Company contained in this
Agreement shall be true and correct on and as of the date hereof and on and as
of the Closing Date as if made on and as of the Closing Date, and you shall have
received a certificate, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of the Company (or such other officers
as
24
are acceptable to you), to the effect set forth in this Section 8(f) and in
Section 8(g), 8(h) and 8(j) hereof.
(h) The acquisitions of Waste Services Inc., Golden Gate Carting, Co.
Inc., Coney Island Rubbish Removal, Inc., Combined Waste Services, Inc., Ameri
Carting, Inc., A-1 Carting Corp., C&R Waste Removal, Inc. and Environmental
Waste Systems Inc. shall have been consummated as of the Closing Date on
substantially the terms set forth in the Registration Statement and the
Acquisition Agreements relating thereto without waiver or modifications of any
material term or provision of such Acquisition Agreements, except as may be
approved by you.
(i) The Company shall not have failed at or prior to the Closing Date
to have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
(j) The Shares shall have been listed or approved for quotation upon
notice of issuance on the Nasdaq National Market.
(k) The Company shall have furnished or caused to be furnished to you
such further certificates and documents as you shall have requested.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel.
Any certificate or document signed by any officer of the Company and
delivered to you, as Representatives of the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Company to
each Underwriter as to the statements made therein.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the satisfaction on and as of any Option Closing Date
of the conditions set forth in this Section 8, except that, if any Option
Closing Date is other than the Closing Date, the certificates, opinions and
letters referred to in paragraphs (c) through (g) and (k) shall be dated the
Option Closing Date in question and the opinions and letter called for by
paragraphs (c), (d) and (e) shall be revised to reflect the sale of Additional
Shares.
9. Expenses. The Company agrees to pay the following costs and expenses
--------
and all other costs and expenses incident to the performance by it of its
obligations hereunder: (i) the preparation, printing or reproduction, and filing
with the Commission of the Registration Statement (including financial
statements and exhibits thereto), each Prepricing Prospectus, the Prospectus,
and each amendment or supplement to any of them; (ii) the printing (or
reproduction) and delivery (including postage, air freight or similar charges
and charges for counting and packaging) of such copies of the Registration
Statement, each Prepricing Prospectus, the Prospectus, the Incorporated
Documents and all amendments or supplements to any of them as may be reasonably
requested for use in connection with the offering and sale of the Shares; (iii)
the preparation, printing, authentication, issuance and
25
delivery of certificates for the Shares, including any stamp taxes in connection
with the original issuance and sale of the Shares; (iv) the printing (or
reproduction) and delivery of this Agreement, the Blue Sky Memorandum and all
other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Shares; (v) the quotation of the Shares on
the Nasdaq National Market; (vi) the registration or qualification of the Shares
for offer and sale under the securities or Blue Sky laws of the several states
as provided in Section 5(g) hereof (including the reasonable fees, expenses and
disbursements of counsel for the Underwriters relating to the preparation,
printing or reproduction, and delivery of the Blue Sky Memorandum and such
registration and qualification); (vii) the filing fees and the fees and expenses
of counsel for the Underwriters in connection with any filings required to be
made with the National Association of Securities Dealers, Inc.; (viii) the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers of
the Shares; and (ix) the fees and expenses of the Company's accountants and the
fees and expenses of counsel (including local and special counsel) for the
Company.
10. Effective Date of Agreement. This Agreement shall become effective:
---------------------------
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when notification of
the effectiveness of the registration statement or such post-effective amendment
has been released by the Commission. Until such time as this Agreement shall
have become effective, it may be terminated by the Company, by notifying you, or
by you, as Representatives of the several Underwriters, by notifying the
Company.
If any one or more of the Underwriters shall fail or refuse to purchase
Shares which it or they are obligated to purchase hereunder on the Closing Date,
and the aggregate number of Shares which such defaulting Underwriter or
Underwriters are obligated but fail or refuse to purchase is not more than one-
tenth of the aggregate number of Shares which the Underwriters are obligated to
purchase on the Closing Date, each non-defaulting Underwriter shall be
obligated, severally, in the proportion which the number of Firm Shares set
forth opposite its name in Schedule I hereto bears to the aggregate number of
Firm Shares set forth opposite the names of all non-defaulting Underwriters or
in such other proportion as you may specify in accordance with Section 20 of the
Master Agreement Among Underwriters of Xxxxx Xxxxxx Inc., to purchase the Shares
which such defaulting Underwriter or Underwriters are obligated, but fail or
refuse, to purchase. If any one or more of the Underwriters shall fail or
refuse to purchase Shares which it or they are obligated to purchase on the
Closing Date and the aggregate number of Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares which
the Underwriters are obligated to purchase on the Closing Date and arrangements
satisfactory to you and the Company for the purchase of such Shares by one or
more non-defaulting Underwriters or other party or parties approved by you and
the Company are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case which does not result in termination of this
Agreement, either you or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required
26
changes, if any, in the Registration Statement and the Prospectus or any other
documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any such default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I hereto who, with your approval and
the approval of the Company, purchases Shares which a defaulting Underwriter is
obligated, but fails or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. Termination of Agreement. This Agreement shall be subject to
------------------------
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company by notice to the Company, if prior to the Closing
Date or any Option Closing Date (if different from the Closing Date and then
only as to the Additional Shares), as the case may be, (i) trading in securities
generally on the New York Stock Exchange, American Stock Exchange or the Nasdaq
National Market shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York or New Jersey shall have
been declared by either federal or state authorities, or (iii) there shall have
occurred any outbreak or escalation of hostilities or other international or
domestic calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United States is
such as to make it, in your judgment, impracticable or inadvisable to commence
or continue the offering of the Shares at the offering price to the public set
forth on the cover page of the Prospectus or to enforce contracts for the resale
of the Shares by the Underwriters. Notice of such termination may be given to
the Company by telegram, telecopy or telephone and shall be subsequently
confirmed by letter.
12. Information Furnished by the Underwriters. The statements set forth
-----------------------------------------
in the last paragraph on the cover page, the stabilization legend on the inside
cover page, and the statements in the first, third and ninth paragraphs under
the caption "Underwriting" in any Prepricing Prospectus and in the Prospectus,
constitute the only information furnished by or on behalf of the Underwriters
through you as such information is referred to in Sections 6(b) and 7 hereof.
13. Miscellaneous. Except as otherwise provided in Sections 5, 10 and 11
-------------
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, at the office of the
Company at 0000 Xxxxxxxx Xxxxx, Xx. Xxxxxx, XX 00000, Attention: Chief Executive
Officer; or (ii) if to you, as Representatives of the several Underwriters, in
care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Manager, Investment Banking Division.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Company, its directors and officers, and the other controlling
persons referred to in Section 7 hereof and their respective successors and
assigns, to the extent provided herein, and no other person shall acquire or
have any right under or by virtue of this Agreement. Neither the term
"successor" nor the
27
term "successors and assigns" as used in this Agreement shall include a
purchaser from any Underwriter of any of the Shares in his status as such
purchaser.
14. Applicable Law; Counterparts. This Agreement shall be governed by and
----------------------------
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
28
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters with respect to the matters
addressed herein.
Very truly yours,
EASTERN ENVIRONMENTAL SERVICES, INC.
By:
------------------------------------------
Name:
Title:
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
XXXXX XXXXXX INC.
XXXXXXXXXXX & CO., INC.
XXXXXXX XXXXXX XXXXX
PACIFIC GROWTH EQUITIES, INC.
XXX XXXXXX & COMPANY
As Representatives of the Several Underwriters
By: XXXXX XXXXXX INC.
By:
------------------------------
Name:
Title:
29
SCHEDULE I
EASTERN ENVIRONMENTAL SERVICES, INC.
Number of
Underwriter Firm Shares
------------ -----------
Xxxxx Xxxxxx Inc. ................
Xxxxxxxxxxx & Co., Inc. ..........
Xxxxxxx Xxxxxx Xxxxx..............
Pacific Growth Equities, Inc. ....
Xxx Xxxxxx & Company .............
-----------
Total ........................... 4,500,000
-----------
Exhibit A
to Underwriting Agreement
EASTERN ENVIRONMENTAL SERVICES INC.
LOCK-UP LETTER
, 1997
XXXXX XXXXXX INC.
XXXXXXXXXXX & CO., INC.
XXXXXXX XXXXXX XXXXX INC.
PACIFIC GROWTH EQUITIES, INC.
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
The undersigned understands that you and certain other firms propose to
enter into an Underwriting Agreement (the "Underwriting Agreement") providing
for the purchase by you and such other firms (the "Underwriters") of shares (the
"Shares") of Common Stock, par value $0.01 per share (the "Common Stock"), of
Eastern Environmental Services, Inc. (the "Company") and that the Underwriters
propose to reoffer the Shares to the public.
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that without the prior written consent of Xxxxx Xxxxxx
Inc. the undersigned will not sell, offer to sell, solicit an offer to buy,
contract to sell, grant any option to purchase, or otherwise transfer or dispose
of, any shares of Common Stock, or any securities convertible into or
exercisable or exchangeable for Common Stock, for a period of 120 days after the
date of the final Prospectus relating to the offering of the Shares to the
public by the Underwriters, except that the undersigned may make gifts of such
securities to members of the undersigned's "immediate family" (as such term is
defined under Item 404 of Regulation S-K under the Securities Act of 1933) or
transfer such securities to one or more trusts established for the benefit of
members of the undersigned's immediate family; provided, that any such
--------
transferee agrees in writing to be bound by the terms hereof. Notwithstanding
the foregoing, nothing herein shall prohibit the undersigned from exercising any
options granted to the undersigned under any Company stock option or other
benefit or incentive plan or warrants held by
Xxxxx Xxxxxx Inc., et al.
, 1997
Page 2
the undersigned so long as the shares of Common Stock underlying such options or
warrants are held subject to the terms of this letter.
The undersigned agrees that the provisions of this agreement shall be
binding also upon the successors, assigns, heirs and personal representatives of
the undersigned.
In furtherance of the foregoing, the Company and American Stock Transfer
and Trust Company, its transfer agent, are hereby authorized to decline to make
any transfer of securities if such transfer would constitute a violation or
breach of this letter agreement.
It is understood that, if the Underwriting Agreement does not become
effective in accordance with its terms on or before December 31, 1997, or if the
Underwriting Agreement (other than the provisions thereof which survive
termination) shall terminate or be terminated prior to payment for and delivery
of the Shares, shall become null and void and of no further force or effect.
Very truly yours,
--------------------------------------
[Name of Signatory]
Exhibit B
to Underwriting Agreement
EASTERN ENVIRONMENTAL SERVICES INC.
LOCK-UP LETTER
, 1997
XXXXX XXXXXX INC.
XXXXXXXXXXX & CO., INC.
XXXXXXX XXXXXX XXXXX INC.
PACIFIC GROWTH EQUITIES, INC.
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
The undersigned understands that you and certain other firms propose to
enter into an Underwriting Agreement (the "Underwriting Agreement") providing
for the purchase by you and such other firms (the "Underwriters") of shares (the
"Shares") of Common Stock, par value $0.01 per share (the "Common Stock"), of
Eastern Environmental Services, Inc. (the "Company") and that the Underwriters
propose to reoffer the Shares to the public.
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that without the prior written consent of Xxxxx Xxxxxx
Inc. the undersigned will not sell, offer to sell, solicit an offer to buy,
contract to sell, grant any option to purchase, or otherwise transfer or dispose
of, any shares of Common Stock, or any securities convertible into or
exercisable or exchangeable for Common Stock, for a period of 90 days after the
date of the final Prospectus relating to the offering of the Shares to the
public by the Underwriters, except that the undersigned may make gifts of such
securities to members of the undersigned's "immediate family" (as such term is
defined under Item 404 of Regulation S-K under the Securities Act of 1933) or
transfer such securities to one or more trusts established for the benefit of
members of the undersigned's immediate family; provided, that any such
--------
transferee agrees in writing to be bound by the terms hereof. Notwithstanding
the foregoing, nothing herein shall prohibit the undersigned from exercising any
options granted to the undersigned under any Company stock option or other
benefit or incentive plan or warrants held by
Xxxxx Xxxxxx Inc., et al.
, 1997
Page 2
the undersigned so long as the shares of Common Stock underlying such options or
warrants are held subject to the terms of this letter.
The undersigned agrees that the provisions of this agreement shall be
binding also upon the successors, assigns, heirs and personal representatives of
the undersigned.
In furtherance of the foregoing, the Company and American Stock Transfer
and Trust Company, its transfer agent, are hereby authorized to decline to make
any transfer of securities if such transfer would constitute a violation or
breach of this letter agreement.
It is understood that, if the Underwriting Agreement does not become
effective in accordance with its terms on or before December 31, 1997, or if the
Underwriting Agreement (other than the provisions thereof which survive
termination) shall terminate or be terminated prior to payment for and delivery
of the Shares, shall become null and void and of no further force or effect.
Very truly yours,
--------------------------------------
[Name of Signatory]
