EXHIBIT 10.36
4,120,000 SHARES
COINMACH LAUNDRY CORPORATION
COMMON STOCK
UNDERWRITING AGREEMENT
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July 17, 1996
XXXXXX BROTHERS INC.
XXXXXX, READ & CO. INC.
LAZARD FRERES & CO. LLC
FIELDSTONE FPCG SERVICES, L.P.,
As Representatives of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Coinmach Laundry Corporation, a Delaware corporation (the "Company"),
proposes to sell an aggregate of 4,120,000 shares (the "Firm Stock") of the
Company's Common Stock, par value $.01 per share (the "Common Stock"). In
addition, the Company proposes to grant to the Underwriters named in Schedule 1
hereto (the "Underwriters") an option to purchase up to an additional 618,000
shares of Common Stock on the terms and for the purposes set forth in Section 3
(the "Option Stock"). The Firm Stock and the Option Stock, if purchased, are
hereinafter collectively called the "Stock." This is to confirm the agreement
concerning the purchase of the Stock from the Company by the Underwriters.
1. Representations, Warranties and Agreements of the Company. The
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Company represents, warrants and agrees that:
(a) A registration statement on Form S-1 and the amendments thereto
with respect to the Stock have (i) been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder, (ii) been filed with the Commission under the Securities Act
and (iii) become
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effective under the Securities Act. Copies of such registration statement
and the amendments thereto have been delivered by the Company to you as the
representatives (the "Representatives") of the Underwriters. As used in
this Agreement, "Effective Time" means the date and the time as of which
such registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; "Effective Date"
means the date of the Effective Time; "Preliminary Prospectus" means each
prospectus included in such registration statement, or amendments thereof,
before it became effective under the Securities Act and any prospectus
filed with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) of the Rules and Regulations;
"Registration Statement" means such registration statement, including any
Rule 462(b) Registration Statement, as amended at the Effective Time,
including all information contained in the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations in
accordance with Section 5 hereof and deemed to be a part of the
registration statement as of the Effective Time pursuant to paragraph (b)
of Rule 430A of the Rules and Regulations; and "Prospectus" means such
final prospectus, as first filed with the Commission pursuant to paragraph
(1) or (4) of Rule 424(b) of the Rules and Regulations. The Commission has
not issued any order preventing or suspending the use of any Preliminary
Prospectus. "Rule 462(b) Registration Statement" means a registration
statement filed pursuant to Rule 462(b) of the Rules and Regulations
relating to the offering covered by the initial registration statement (No.
333-03587).
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform in all material respects to the
requirements of the Securities Act and the Rules and Regulations and do not
and will not, as of the applicable effective date (as to the Registration
Statement and any amendment thereto) and as of the applicable filing date
(as to the Prospectus and any amendment or supplement thereto) contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading; provided, however, that no representation or warranty is
made as to information concerning any Underwriter contained in or omitted
from the Registration Statement or the
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Prospectus in reliance upon and in conformity with written information
furnished to the Company through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as defined in Section
15) have been duly incorporated and are validly existing as corporations in
good standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in good standing
as foreign corporations in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective business
requires such qualification, except where the failure to be so qualified
would not be reasonably expected to have a material adverse effect on the
consolidated financial position, stockholders' equity, result of
operations, business or business prospects of the Company and its
subsidiaries, taken as a whole (a "Material Adverse Effect"), and have all
power and authority necessary to own or hold their respective properties
and to conduct the businesses in which they are engaged; and none of the
subsidiaries of the Company (other than Coinmach Corporation, a Delaware
corporation and a wholly owned subsidiary of the Company) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations.
(d) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and non-
assessable and conform in all material respects to the description thereof
contained in the Prospectus; and all of the issued shares of capital stock
of each subsidiary of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable and are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims, except for liens, encumbrances, equities or claims of
Xxxxxx Financial, Inc. ("Xxxxxx") pursuant to those certain Pledge
Agreements, dated November 30, 1995, between Xxxxxx and each of the Company
and Coinmach Corporation (the "Pledge Agreements").
(e) The shares of the Stock to be issued and sold by the Company to
the Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein will be
duly and validly
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issued, fully paid and non-assessable, and will conform to the description
thereof contained in the Prospectus.
(f) This Agreement has been duly authorized, executed and delivered by
the Company.
(g) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby will
not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any material indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the property
or assets of the Company or any of its subsidiaries is subject, nor will
such actions result in any violation of the provisions of the charter or
by-laws of the Company or any of its subsidiaries or any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of
their properties or assets; and except for the registration of the Stock
under the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange Act
and applicable state securities laws in connection with the purchase and
distribution of the Stock by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any such court
or governmental agency or body is required for the execution, delivery and
performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby.
(h) Except as described in the Registration Statement or the exhibits
thereto or in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person granting such person the
right (other than rights that have been waived or satisfied) to require the
Company to file a registration statement under the Securities Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Securities Act.
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(i) Except as described in the Registration Statement or the
Prospectus, the Company has not sold or issued any shares of Common Stock
during the six-month period preceding the date of the Prospectus, including
any sales pursuant to Rule 144A under, or Regulations D or S of, the
Securities Act.
(j) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included in the
Prospectus, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus; and, since
such date, to the actual knowledge of Xxxxxxx X. Xxxxxxxx, Xxxxxxxx Xxxxx,
Xxxxxx X. Xxxxx or Xxxx X. Xxxxxx (the "Officers"), there has not been any
change in the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included in the Prospectus present fairly the financial condition and
results of operations of the entities purported to be shown thereby, at the
dates and for the periods indicated, and have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
throughout the periods involved. The pro forma financial statements and
other pro forma financial information (including the notes thereto)
included in the Registration Statement and the Prospectus (i) present
fairly the information shown therein, (ii) have been prepared in accordance
with the applicable requirements of Rule 11-02 of the Rules and
Regulations, (iii) have been prepared in accordance with the Commission's
rules and guidelines with respect to pro forma financial statements and
(iv) have been properly compiled on the basis described therein and the
assumptions used in the preparation of the pro forma financial statements
and other pro forma financial information (including the notes thereto) and
included in the Registration Statement and the Prospectus are reasonable
and the adjustments used therein are appropriate to give
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effect to the transactions or circumstances referred to therein.
(l) Ernst & Young, LLP ("E&Y"), who have certified certain financial
statements of the Company, whose report appears in the Prospectus and who
have delivered an initial letter referred to in Section 7(g) hereof, are
independent public accountants as required by the Securities Act and the
Rules and Regulations; and KPMG Peat Marwick, LLP ("KPMG") and Xxxxxx
Xxxxxxxx LLP ("AA"), whose reports appear in the Prospectus and who have
each delivered an initial letter referred to in Section 7(g) hereof, were
independent accountants as required by the Securities Act and the Rules and
Regulations during the periods covered by the financial statements on which
they reported contained in the Prospectus.
(m) (i) Neither the Company nor any of its subsidiaries own any real
property other than the real property located in Baltimore, Maryland; (ii)
the Company and each of its subsidiaries have marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects, except as are described in the Propectus or such
as do not materially interfere with the use made and proposed to be made
(as described in the Prospectus) of such property by the Company and its
subsidiaries and (iii) all real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid, subsisting
and enforceable leases, except (A) the Company's facility located in
Roslyn, New York, and (B) where the failure to so hold real property and
buildings under valid, subsisting and enforceable leases would not be
reasonably expected to result in a Material Adverse Effect.
(n) Except as described in the Prospectus, the Company and each of
its subsidiaries carry, or are covered by, insurance in such amounts and
covering such risks as is, in the reasonable judgment of the Company,
adequate for the conduct of their respective businesses and the value of
their respective properties.
(o) The Company and each of its subsidiaries own or possess adequate
rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service xxxx
registrations, copyrights and licenses necessary for the conduct of their
respective businesses and the Officers have no reason to
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believe that the conduct of their respective businesses will conflict with,
and have not received any notice of any claim of conflict with, any such
rights of others.
(p) Except as disclosed in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject that, if determined adversely to
the Company or any of its subsidiaries, might have a Material Adverse
Effect; and to the actual knowledge of the Officers, no such proceedings
are threatened by governmental authorities or by others.
(q) There are no contracts or other documents to which the Company or
any of its subsidiaries is a party that are required to be described in the
Prospectus or filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations that have not been described
in the Prospectus or filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the Rules and
Regulations.
(r) No relationship, direct or indirect, exists between or among the
Company, on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company, on the other hand, that is required
to be described in the Prospectus that is not so described.
(s) Except as disclosed in the Prospectus, no labor disturbance by the
employees of the Company exists or, to the actual knowledge of the
Officers, is imminent that might reasonably be expected to have a Material
Adverse Effect.
(t) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security
Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company would have any liability; the Company has not
incurred and does not expect to incur liability under (i) Title IV of ERISA
with respect to termination of, or withdrawal from, any "pension plan" or
(ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the
"Code"); and each "pension plan", except for the Solon Profit Sharing and
Retirement
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Savings Plan, for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is so qualified
in all material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification.
(u) The Company has filed or properly been granted an extension for
filing all federal, state and local income and franchise tax returns
required to be filed through the date hereof and has paid all taxes due
thereon, and no tax deficiency has been determined that has had (nor do the
Officers have any actual knowledge of any tax deficiency that might
reasonably be expected to have) a Material Adverse Effect.
(v) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities, (ii)
incurred any liability or obligation, direct or contingent, other than
liabilities and obligations that were incurred in the ordinary course of
business and consistent with past practice, (iii) entered into any
transaction not in the ordinary course of business and consistent with past
practice or (iv) declared or paid any dividend on its capital stock.
(w) The Company (i) makes and keeps accurate books and records in all
material respects and (ii) maintains internal accounting controls that
provide reasonable assurance that (A) material transactions are executed in
accordance with management's authorization and (B) material transactions
are recorded as necessary to permit preparation of its financial statements
and to maintain accountability for its assets.
(x) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default in any material
respect, and, to the actual knowledge of the Officers, no event has
occurred that, with notice or lapse of time or both, would constitute such
a default, in the due performance or observance of any term, covenant or
condition contained in any material indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which it
is a party or by which it is bound or to which any of its properties or
assets is subject or (iii) is in violation in any material respect of any
law,
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ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any material
license, permit, certificate, franchise or other governmental authorization
or permit necessary to the ownership of its property or to the conduct of
its business.
(y) Neither the Company nor any of its subsidiaries, nor any
director or, officer, nor to the knowledge of any of the Officers any
agent, employee or other person authorized to act on behalf of the Company
or any of its subsidiaries, has used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to
political activity; made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds;
violated or is in violation of any provision of the Foreign Corrupt
Practices Act of 1977; or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
(z) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of
its subsidiaries (or, to the actual knowledge of the Officers, any of their
predecessors in interest) at, upon or from any of the property now or
previously owned or leased by the Company or its subsidiaries in violation
of any applicable law, ordinance, rule, regulation, order, judgement,
decree or permit or that would require remedial action under any applicable
law, ordinance, rule, regulation, order, judgment, decree or permit, except
for any violation or remedial action that would not be reasonably likely to
have, singularly or in the aggregate with all such violations and remedial
actions, a Material Adverse Effect; there has been no material spill,
discharge, leak, emission, injection, escape, dumping or release of any
kind onto such property or into the environment surrounding such property
of any toxic wastes, medical wastes, solid wastes, hazardous wastes or
hazardous substances due to or caused by the Company or any of its
subsidiaries or with respect to which the Officers have actual knowledge,
except for any such spill, discharge, leak, emission, injection, escape,
dumping or release that would not be reasonably likely to have, singularly
or in the aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings and releases, a Material Adverse Effect; and
the terms "hazardous wastes", "toxic wastes", "hazardous substances" and
"medical wastes"
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shall have the meanings specified in any applicable local, state, federal
and foreign laws or regulations with respect to environmental protection.
(aa) Neither the Company nor any subsidiary is an "investment
company" within the meaning of such term under the Investment Company Act
of 1940 and the rules and regulations of the Commission thereunder.
2. Purchase of the Stock by the Underwriters. On the basis of the
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representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 4,120,000 shares of
the Firm Stock to the several Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase the number of shares of the Firm
Stock set opposite that Underwriter's name in Schedule 1 hereto. The respective
purchase obligations of the Underwriters with respect to the Firm Stock shall be
rounded among the Underwriters to avoid fractional shares, as the
Representatives may determine.
In addition, the Company grants to the Underwriters an option (the
"Option") to purchase up to 618,000 shares of Option Stock. Such option is
granted solely for the purpose of covering over-allotments in the sale of Firm
Stock and is exercisable as provided in Section 4 hereof. Shares of Option
Stock shall be purchased severally for the account of the Underwriters in
proportion to the number of shares of Firm Stock set opposite the name of such
Underwriters in Schedule 1 hereto. The respective purchase obligations of each
Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that no Underwriter shall be obligated to purchase Option
Stock other than in 100 share amounts. The price of both the Firm Stock and any
Option Stock shall be $13.02 per share.
The Company shall not be obligated to deliver any of the Stock to be
delivered on the First Delivery Date or the Second Delivery Date (as hereinafter
defined), as the case may be, except upon payment for all the Stock to be
purchased on such Delivery Date as provided herein.
3. Offering of Stock by the Underwriters. Upon authorization by the
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Representatives of the release of the Firm Stock, the several Underwriters
propose to offer the Firm Stock for sale upon the terms and conditions set forth
in the Prospectus.
4. Delivery of and Payment for the Stock. Delivery of and payment
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for the Firm Stock shall be made at the office of
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Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., New
York City time, on the fourth full business day following the date of this
Agreement or at such other date or place as shall be determined by agreement
between the Representatives and the Company. This date and time are sometimes
referred to as the "First Delivery Date." On the First Delivery Date, the
Company shall deliver or cause to be delivered certificates representing the
Firm Stock to the Representatives for the account of each Underwriter against
payment to or upon the order of the Company of the purchase price by wire
transfer of immediately available funds. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement is a further
condition of the obligation of each Underwriter hereunder. Upon delivery, the
Firm Stock shall be registered in such names and in such denominations as the
Representatives shall request in writing not less than two full business days
prior to the First Delivery Date. For the purpose of expediting the checking
and packaging of the certificates for the Firm Stock, the Company shall make the
certificates representing the Firm Stock available for inspection by the
Representatives in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to the First Delivery Date.
At any time on or before the thirtieth day after the date of this
Agreement the Option may be exercised by written notice being given to the
Company by the Representatives. Such notice shall set forth the aggregate
number of shares of Option Stock as to which the Option is being exercised, the
names in which the shares of Option Stock are to be registered, the
denominations in which the shares of Option Stock are to be issued and the date
and time, as determined by the Representatives, when the shares of Option Stock
are to be delivered; provided, however, that this date and time shall not be
earlier than the First Delivery Date nor earlier than the second business day
after the date on which the Option shall have been exercised nor later than the
fifth business day after the date on which the Option shall have been exercised.
The date and time the shares of Option Stock are delivered are sometimes
referred to as the "Second Delivery Date" and the First Delivery Date and the
Second Delivery Date are sometimes each referred to as a "Delivery Date."
Delivery of and payment for the Option Stock shall be made at the
place specified in the first sentence of the first paragraph of this Section 4
(or at such other place as shall be determined by agreement between the
Representatives and the Company) at 10:00 A.M., New York City time, on the
Second
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Delivery Date. On the Second Delivery Date, the Company shall deliver or cause
to be delivered the certificates representing the Option Stock to the
Representatives for the account of each Underwriter against payment to or upon
the order of the Company of the purchase price by wire transfer of immediately
available funds. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligation of each Underwriter hereunder. Upon delivery, the Option Stock shall
be registered in such names and in such denominations as the Representatives
shall request in the aforesaid written notice. For the purpose of expediting
the checking and packaging of the certificates for the Option Stock, the Company
shall make the certificates representing the Option Stock available for
inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the Second Delivery Date.
5. Further Agreements of the Company. The Company agrees:
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(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Securities Act not later than the Commission's close of business on the
second business day following the execution and delivery of this Agreement
or, if applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Securities Act; to make no further amendment or any supplement to
the Registration Statement or to the Prospectus except as permitted herein;
to advise the Representatives, promptly after it receives notice thereof,
of the time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Representatives with copies
thereof; to advise the Representatives, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Stock for
offering or sale in any jurisdiction, of the initiation or threatening of
any proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or the
Prospectus or for additional information; and, in the event of the issuance
of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any such
qualification, to use promptly all commercially reasonable efforts to
obtain its withdrawal;
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(b) To furnish promptly to each of the Representatives and to counsel
for the Underwriters a signed copy of the Registration Statement as
originally filed with the Commission, and each amendment thereto filed with
the Commission, including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representatives such number of the
following documents as the Representatives shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case excluding exhibits
other than this Agreement) and (ii) each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and, if the delivery
of a prospectus is required at any time after the Effective Time in
connection with the offering or sale of the Stock or any other securities
relating thereto and if at such time any events shall have occurred as a
result of which, in the reasonable judgment of Xxxxxx Xxxxxx & Xxxxxxx,
outside counsel for the Underwriters, the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when
such Prospectus is delivered, not misleading, or, if for any other reason
it shall be necessary to amend or supplement the Prospectus in order to
comply with the Securities Act, to notify the Representatives and, upon
their request, to prepare and furnish without charge to each Underwriter
and to any dealer in securities as many copies as the Representatives may
from time to time reasonably request of an amended or supplemented
Prospectus that will correct such statement or omission or effect such
compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Company or the reasonable
judgment of the Representatives, be required by the Securities Act or
requested by the Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 424 of the Rules and Regulations, to furnish a copy
thereof to the Representatives and counsel for the Underwriters a
reasonable amount of time prior to such proposed filing and
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will not file any such amendment or supplement to which the Representatives
or counsel for the Underwriters shall reasonably object;
(f) As soon as practicable after the Effective Date, to make generally
available to the Company's securityholders and to deliver to the
Representatives an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Securities
Act and the Rules and Regulations (including, at the option of the Company,
Rule 158);
(g) For a period of five years following the Effective Date, to
furnish to the Representatives copies of all materials furnished by the
Company to its stockholders and all public reports and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the Common Stock may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the Commission
thereunder;
(h) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Stock for offering
and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of the Stock;
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(i) For a period of 180 days from the date of the Prospectus, not to,
directly or indirectly, offer for sale, sell or otherwise dispose of (or
enter into any transaction or device that is designed to, or could be
expected to, result in the disposition by any person at any time in the
future of) any shares of Common Stock (other than the Stock and shares
issued pursuant to employee benefit plans, qualified stock option plans or
other employee compensation plans existing on the date hereof), or sell or
grant options, rights or warrants with respect to any shares of Common
Stock (other than the grant of options pursuant to option plans existing
on the date hereof or the granting of options as disclosed in the
Prospectus), without the prior written consent of Xxxxxx Brothers Inc.; and
to cause each
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officer, director and holder of Common Stock of the Company to furnish to
the Representatives, prior to the First Delivery Date, a letter or letters,
in form and substance satisfactory to counsel for the Underwriters,
pursuant to which each such person shall agree not to, directly or
indirectly, offer for sale, sell or otherwise dispose of (or enter into any
transaction or device that is designed to, or could be expected to, result
in the disposition by any person at any time in the future of) any shares
of Common Stock for a period of 180 days from the date of the Prospectus,
without the prior written consent of Xxxxxx Brothers Inc.;
(j) Prior to the Effective Date, to apply for the listing of the Stock
on the Nasdaq National Market and to use all commercially reasonable
efforts to complete that listing, subject only to official notice of
issuance, prior to the First Delivery Date;
(k) Prior to filing with the Commission any reports on Form SR
pursuant to Rule 463 of the Rules and Regulations, to furnish a copy
thereof to the counsel for the Underwriters and receive and consider its
comments thereon, and to deliver promptly to the Representatives a signed
copy of each report on Form SR filed by it with the Commission;
(l) To apply the net proceeds from the sale of the Stock being sold by
the Company as set forth in the Prospectus;
(m) To take such steps as shall be reasonably necessary to ensure that
neither the Company nor any subsidiary shall become an "investment company"
within the meaning of such term under the Investment Company Act of 1940
and the rules and regulations of the Commission thereunder.
6. Expenses. The Company agrees to pay (a) the costs incident to
--------
the authorization, issuance, sale and delivery of the Stock and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act of the Registration Statement and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the costs of producing and
-16-
distributing this Agreement and any other related documents in connection with
the offering, purchase, sale and delivery of the Common Stock; (e) the filing
fees and the reasonable fees and disbursements of counsel for the Underwriters
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of sale of the Stock; (f) any applicable
listing or other fees; (g) the fees and expenses of qualifying the Stock under
the securities laws of the several jurisdictions as provided in Section 5(h) and
of preparing, printing and distributing a Blue Sky Memorandum (including related
reasonable fees and expenses of counsel to the Underwriters); (h) any fees
charged by securities rating services for rating the Stock; and (i) all other
costs and expenses incident to the performance of the obligations of the Company
under this Agreement; provided that, except as provided in this Section 6 and in
Section 11, the Underwriters shall pay their own costs and expenses, including
the costs and expenses of their counsel, any transfer taxes on the Stock that
they may sell and the expenses of advertising any offering of the Stock made by
the Underwriters.
7. Conditions of Underwriters' Obligations. The respective
---------------------------------------
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the Company
contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 5(a); no stop order suspending the effectiveness of
the Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened by
the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with.
(b) No Underwriter shall have discovered and disclosed to the Company
on or prior to such Delivery Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact that in the reasonable opinion of Xxxxxx Xxxxxx &
Xxxxxxx, counsel for the Underwriters, is material or omits to state a fact
that in the reasonable opinion of such counsel, is material and is
required to be stated therein or is necessary to make the statements
therein not misleading.
-17-
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Stock, the
Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall
be reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Company shall have furnished to such counsel all
documents and information that they may reasonably request to enable them
to pass upon such matters.
(d) Xxxxxxxx Kill Xxxxx & Xxxxxxxx, P.C., as counsel to the Company,
shall have furnished to the Representatives its written opinion, addressed
to the Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Representatives, to the effect set forth in
Exhibit A hereto:
(e) The Representatives shall have received from Xxxxxx Xxxxxx &
Xxxxxxx, counsel for the Underwriters, such opinion or opinions, dated such
Delivery Date, with respect to the issuance and sale of the Stock, the
Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as such counsel reasonably request
for the purpose of enabling it to pass upon such matters.
(f) At the time of execution of this Agreement, the Representatives
shall have received from each of E&Y, KPMG and AA a letter, in form and
substance satisfactory to the Representatives, addressed to the
Underwriters and dated the date hereof (i) confirming that they are
independent public accountants within the meaning of the Securities Act and
are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, (ii) stating, as of the date hereof (or, with respect to
matters involving changes or developments since the respective dates as of
which specified financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the conclusions and
findings of such firm with respect to the financial information and other
matters ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(g) With respect to the letter of each of E&Y, KPMG and AA referred to
in the preceding paragraph and delivered to the Representatives
concurrently with the execution of
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this Agreement (the "initial letter"), the Company shall have furnished to
the Representatives a letter (the "bring-down letter") of such accountants,
addressed to the Underwriters and dated such Delivery Date (i) confirming
that they are independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation
S-X of the Commission, (ii) stating, as of the date of the bring-down
letter (or, with respect to matters involving changes or developments since
the respective dates as of which specified financial information is given
in the Prospectus, as of a date not more than five days prior to the date
of the bring-down letter), the conclusions and findings of such firm with
respect to the financial information and other matters covered by the
initial letter and (iii) confirming in all material respects the
conclusions and findings set forth in the initial letter.
(h) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chairman of the Board and
Chief Executive Officer and its Senior Vice President and Chief Financial
Officer stating that:
(i) The representations and warranties of the Company in Section
1 that are qualified with reference to a Material Adverse Effect or
materiality are true and correct as of such Delivery Date; and the
representations and warranties of the Company that are not so qualified
shall be true and correct in all material respects, in each case as of
such Delivery Date; the Company has complied in all material respects
with all its agreements contained herein; and the conditions set forth
in Sections 7(a) and 7(i) have been fulfilled in all material respects;
and
(ii) They have carefully examined the Registration Statement and
the Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not include any untrue
statement of a material fact and did not omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and (B) since the Effective no event has
occurred that should have been set forth in a supplement or amendment to
the Registration Statement or the Prospectus.
-19-
(i) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus or
(ii) since such date there shall not have been any change in the capital
stock or long-term debt of the Company or any of its subsidiaries or any
change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of which,
in any such case described in clause (i) or (ii), is, in the reasonable
judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Stock being delivered on such Delivery Date on the terms
and in the manner contemplated in the Prospectus.
(j) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization,"
as that term is defined by the Commission for purposes of Rule 436(g)(2) of
the Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
(k) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or
in the over-the-counter market, or trading in any securities of the Company
on any exchange or in the over-the-counter market, shall have been
suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (ii) a
banking moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by
-20-
the Untied States or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets in the United
States shall be such) as to make it, in the reasonable judgment of a
majority in interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or delivery of the Stock
being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(l) The Nasdaq National Market shall have approved the Stock for
inclusion, subject only to official notice of issuance and evidence of
satisfactory distribution.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
8. Indemnification and Contribution.
--------------------------------
(a) The Company and Coinmach Corporation, its principal operating
subsidiary (the "Principal Subsidiary"), jointly and severally, shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Securities Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Stock), to which
that Underwriter, officer, employee or controlling person may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in any Preliminary
Prospectus, the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (B) in any blue sky application or other document prepared
or executed by the Company (or based upon any written information furnished by
the Company) specifically for the purpose of qualifying any or all of the Stock
under the securities laws of any state or other jurisdiction (any such
application, document or information being hereinafter called a "Blue Sky
Application"), (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be
-21-
stated therein or necessary to make the statements therein not misleading or
(iii) any act or failure to act or any alleged act or failure to act by any
Underwriter in connection with, or relating in any manner to, the Stock or the
offering contemplated hereby, and that is included as part of or referred to in
any loss, claim, damage, liability or action arising out of or based upon
matters covered by clause (i) or (ii) above (provided that the Company and the
--------
Principal Subsidiary shall not be liable under this clause (iii) to the extent
that it is determined in a final judgment by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by such
Underwriter through its negligence or willful misconduct), and shall reimburse
each Underwriter and each such officer, employee or controlling person promptly
upon demand for any legal or other expenses reasonably incurred by that
Underwriter, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
-------- -------
that the Company and the Principal Subsidiary shall not be liable in any such
case to the extent that any such loss, claim, damage, liability or action arises
out of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application, in reliance upon and in conformity
with written information concerning such Underwriter furnished to the Company
through the Representatives by or on behalf of any Underwriter specifically for
inclusion therein; provided, further, that the indemnification and contribution
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agreements contained in this Section 8 with respect to any Preliminary
Prospectus, or the Prospectus after it has been amended or supplemented, shall
not inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting such loss, claim, damage, liability
or action shall have purchased Stock that are the subject thereof it, after a
sufficient number of copies thereof have been delivered by the Company to such
Underwriter, such Underwriter shall have failed to send or give a copy of the
final Prospectus or of the Prospectus as then amended or supplemented, as the
case may be, to such person at or prior to the confirmation of such sale of such
Stock to such person, and, if such loss, claim, damage, liability or action
would not have arisen but for such failure. The foregoing indemnity agreement
is in addition to any liability that the Company or the Principal Subsidiary may
otherwise have to any Underwriter or to any officer, employee or controlling
person of that Underwriter.
-22-
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or (B) in any Blue Sky Application or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information concerning
such Underwriter furnished to the Company through the Representatives by or on
behalf of that Underwriter specifically for inclusion therein, and shall
reimburse the Company and any such director, officer, employee or controlling
person for any legal or other expenses reasonably incurred by the Company or any
such director, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability that any Underwriter may
otherwise have to the Company or any such director, officer, employee or
controlling person.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
-------- -------
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have under this Section 8 except to the extent it has been
materially prejudiced by such failure and, provided further, that the failure
--------
to notify the indemnifying party shall not relieve it from any liability that it
may have to an indemnified party otherwise than under this Section 8. If any
such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party
-23-
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying party
to the indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the Representatives
-------- -------
shall have the right to employ counsel to represent jointly the Representatives
and those other Underwriters and their respective officers, employees and
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriters against the Company
or the Principal Subsidiary under this Section 8 if, in the reasonable judgment
of the legal counsel of the Representatives, it is advisable for the
Representatives and those Underwriters, officers, employees and controlling
persons to be jointly represented by separate counsel due to (y) the existence
of actual or potential differing interests between such Representatives,
Underwriters, officers, employees and controlling persons or (z) the
availability of different defenses among such parties, and in that event the
fees and expenses of such separate counsel shall be paid by the Company or the
Principal Subsidiary. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with the consent of the indemnifying
party or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 8(a) or 8(b)
-24-
in respect of any loss, claim, damage or liability, or any action in respect
thereof, referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company and the Principal
Subsidiary on the one hand and the Underwriters on the other from the offering
of the Stock 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 and the Principal Subsidiary on the one hand and the
Underwriters on the other with respect to the statements or omissions that
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Principal Subsidiary on the one hand and the
Underwriters on the other with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering of the Stock
purchased under this Agreement (before deducting expenses) received by the
Company and the Principal Subsidiary on the one hand, and the total underwriting
discounts and commissions received by the Underwriters with respect to the
shares of the Stock purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of the Stock under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company, the Principal Subsidiary or the Underwriters, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. For purposes of the preceding two
sentences, the net proceeds deemed to be received by the Company shall be deemed
to be also for the benefit of the Principal Subsidiary and information supplied
by the Company shall also be deemed to have been supplied by the Principal
Subsidiary. The Company, the Principal Subsidiary and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Section were to be determined by 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 into account the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of
the loss, claim, damage or liability, or action in respect thereof,
-25-
referred to above in this Section shall be deemed to include, for purposes of
this Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Not withstanding the provisions of this Section 8(d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Stock underwritten by it and distributed to the public
was offered to the public exceeds the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any untrue
or alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 8(e) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute as provided in this Section 8(d) are several in proportion to their
respective underwriting obligations and not joint.
(e) The Underwriters severally confirm and the Company acknowledges
that the statements with respect to the public offering of the Stock by the
Underwriters set forth in the last paragraph on the cover page of, the legend
concerning over-allotments on the inside front cover page of and the concession
and reallowance figures appearing under the caption "Underwriting" in, the
Prospectus are correct and constitute the only information concerning such
Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
9. Defaulting Underwriters.
-----------------------
If, on either Delivery Date, any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining non-
defaulting Underwriters shall be obligated to purchase the Stock that the
defaulting Underwriter agreed but failed to purchase on such Delivery Date in
the respective pro portions that the number of shares of the Firm Stock set
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the total number of shares of the Firm Stock set opposite the
names of all the remaining non- defaulting Underwriters in Schedule 1 hereto;
provided, however, that the remaining non- defaulting Underwriters shall not be
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obligated to purchase any of the Stock on such Delivery Date if the total number
of shares of the Stock that the defaulting Underwriter or Underwriters agreed
but failed to purchase on such date exceeds 9.09% of the total number of shares
of the Stock to be purchased
-26-
on such Delivery Date, and any remaining non-defaulting Underwriter shall not be
obligated to purchase more than 110% of the number of shares of the Stock that
it agreed to purchase on such Delivery Date pursuant to the terms of Section 2.
If the foregoing maximums are exceeded, the remaining non-defaulting
Underwriters, or those other underwriters satisfactory to the Representatives
who so agree, shall have the right, but shall not be obligated, to purchase, in
such proportion as may be agreed upon among them, all the Stock to be purchased
on such Delivery Date. If the remaining Underwriters or other underwriters
satisfactory to the Representatives do not elect to purchase the shares that the
defaulting Underwriter or Underwriters agreed but failed to purchase on such
Delivery Date, this Agreement (or, with respect to the Second Delivery Date, the
obligation of the Underwriters to purchase, and of the Company to sell, the
Option Stock) shall terminate without liability on the part of any non-
defaulting Underwriter or the Company, except that the Company will continue to
be liable for the payment of expenses to the extent set forth in Sections 6 and
11. As used in this Agreement, the term "Underwriter" includes, for all
purposes of this Agreement unless the context requires otherwise, any party not
listed in Schedule 1 hereto who, pursuant to this Section 9, purchase Firm Stock
that a defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If
other underwriters are obligated or agree to purchase the Stock of a defaulting
or with drawing Underwriter, either the Representatives or the Company may
postpone the Delivery Date for up to seven full business days in order to effect
any changes that in the opinion of counsel for the Company or counsel for the
Underwriters may be necessary in the Registration Statement, the Prospectus or
in any other document or arrangement.
10. Termination. The obligations of the Underwriters hereunder may
-----------
be terminated by the Representatives by notice given to and received by the
Company prior to delivery of and payment for the Firm Stock if, prior to that
time, any of the events described in Sections 7(i), 7(j) or 7(k), shall have
occurred or if the Underwriters shall decline to purchase the Stock for any
reason permitted under this Agreement.
11. Reimbursement of Underwriters' Expenses. If (a) the Company
---------------------------------------
shall fail to tender the Stock for delivery to the Underwriters by reason of any
failure, refusal or inability on the part of the Company to perform any
agreement on its part
-27-
to be performed, or because any other condition of the Under writers'
obligations hereunder required to be fulfilled by the Company is not fulfilled,
the Company will reimburse the Under writers for all reasonable out-of-pocket
expenses (including fees and disbursements of counsel) incurred by the
Underwriters in connection with this Agreement and the proposed purchase of the
Stock, and upon demand the Company shall pay the full amount thereof to the
Representatives. If this Agreement is terminated pursuant to Section 9 by
reason of the default of one or more Underwriters, the Company shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
12. Notices, etc. All statements, request, notices and agreements
------------
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to Xxxxxx Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax:
000-000-0000), with a copy, in the case of any notice pursuant to Section
8(d), to the Director of Litigation, Office of the General Counsel, Xxxxxx
Brothers Inc., 0 Xxxxx Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company or the Principal Subsidiary, shall be delivered
or sent by mail, telex or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: Xxxxxx X.
Xxxxx (Fax: (000) 000-0000);
provided, however, that any notice to an Underwriter pursuant to Section 8(d)
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shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by Xxxxxx Brothers Inc. on behalf of the
Representatives.
13. Persons Entitled to Benefit of Agreement. This Agreement shall
----------------------------------------
inure to the benefit of and be binding upon the Underwriters, the Company and
its respective successors. This Agreement and the terms and provisions hereof
are for the sole benefit of only those persons, except that (A) the representa
tions, warranties, indemnities and agreement of the Company
-28-
contained in this Agreement shall also be deemed to be for the benefit of the
person or persons, if any, who control any Underwriter within the meaning of
Section 15 of the Securities Act and (B) the indemnity agreement of the
Underwriters contained in Section 8(b) of this Agreement shall be deemed to be
for the benefit of directors of the Company, officers of the Company who have
signed the Registration Statement and any person controlling the Company within
the meaning of Section 15 of the Securities Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section 13, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
14. Survival. The respective indemnities, representations,
--------
warranties and agreement of the Company, the Principal Subsidiary and the
Underwriters contained in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Stock and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
15. Definition of the Terms "Business Day" and "Subsidiary". For
-------------------------------------------------------
purposes of this Agreement, (a) "business day" means any day on which the New
York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or more
------------
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for convenience of
--------
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
-29-
If the foregoing correctly sets forth the agreement by and among the
Company, the Principal Subsidiary and the Underwriters, please indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
Coinmach Laundry Corporation
By: /s/ XXXXXX X. XXXXX
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
and Chief Financial Officer
Coinmach Corporation,
the Principal Subsidiary
By: /s/ XXXXXX X. XXXXX
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President
and Chief Financial Officer
Accepted:
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
By XXXXXX BROTHERS INC.
By: /s/ XXXXXXXX XXXXXXXXXXX
-------------------------------
Authorized Representative
Exhibit A
---------
Letterhead of Xxxxxxxx Kill Xxxxx ,P.C.
(000) 000-0000
July 23, 1996
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
c/x Xxxxxx Brothers Inc.
Three World Financial Center
New York, New York 10285
Ladies and Gentlemen:
We have acted as special counsel to Coinmach Laundry Corporation, a
Delaware corporation (the "Company"), in connection with the preparation of a
-------
registration statement on Form S-1 (No. 333-03587) which was filed by the
Company with the Securities and Exchange Commission on May 13, 1996 (the "First
-----
Registration Statement") and a registration statement on Form S-1 (No. 333-
----------------------
08331) filed with the Securities and Exchange Commission on July 18, 1996 (the
"Second Registration Statement") (as the First Registration Statement and the
------------------------------
Second Registration Statement may be amended from time to time, and including
all documents incorporated by reference in such registration statements,
together, the "Registration Statement"). The Registration Statement relates to
----------------------
the registration by the Company under the Securities Act of 1933, as amended
(the "Securities Act"), of up to 4,120,000 shares (the "Firm Stock") of the
-------------- ----------
Company's Class A common stock, par value $.01 per share (the "Common Stock"),
------------
and the sale of up to an additional 618,000 shares of the Common Stock to cover
the exercise of an over-allotment option by the Underwriters (the "Option Stock"
------------
and, together with the Firm Stock, the "Stock"). This opinion is furnished to
-----
you pursuant to Section 7(d) of the Underwriting Agreement, dated as of July 17,
1996 (the "Underwriting Agreement"), among the Company and each of you (the
----------------------
"Underwriters"). Capitalized terms used but not otherwise specifically defined
-------------
herein shall have the meanings ascribed to such terms in the Underwriting
Agreement.
In rendering the opinions expressed below, we have been furnished with
and, without independent investigation but with your consent have relied upon,
(i) certificates of officers, directors and representatives of the Company and
its Subsidiaries (as hereinafter defined) with respect to certain factual
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 2
defined) with respect to certain factual matters, (ii) certificates, documents,
instruments and assurances of public officials as we have deemed appropriate or
advisable, and (iii) representations and warranties made in the Underwriting
Agreement. We have also examined originals, or copies identified to our
satisfaction as being true copies, of the documents listed below, and we have
made no independent investigation of any factual information contained therein
or contained in any documents incorporated by reference or otherwise referred to
therein (collectively, the "Documents"):
---------
A. Underwriting Agreement;
B. Registration Statement;
C. Resolutions of the boards of directors of each of the Company,
Coinmach Corporation, a Delaware corporation ("Coinmach"), Super Laundry
--------
Equipment Corp., a New York corporation ("SLEC"), and Grand Wash & Dry
----
Launderette, Inc., a New York corporation ("Grand Wash," together with Coinmach
----------
and SLEC, the "Subsidiaries" or each a "Subsidiary"), in each case certified by
------------ ----------
its respective Secretary;
D. Certified copies of the certificates of incorporation, as amended
and restated, of the Company and each Subsidiary;
E. Certified copies of the bylaws, as amended and restated, of the
Company and of each Subsidiary;
F. Good standing certificates from the Secretary of State of the
state of incorporation of the Company and each of the Subsidiaries; and
G. Incumbency certificates for the officers of the Company and each
Subsidiary.
In addition, for the purposes of the opinions rendered herein, we have
assumed with your permission and without independent verification:
(a) that all signatures of all persons signing all Documents (other
than those persons signing Documents on behalf of the Company or the
Subsidiaries) in connection with which this opinion is rendered are genuine and
authorized;
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 3
(b) that all Documents submitted to us as true copies, whether
certified or not, conform to authentic original Documents;
(c) the existence, good standing, capacity and, where applicable,
qualification to do business, of all of the parties (other than the existence,
good standing and capacity of the Company and the Subsidiaries and other than
the qualification to do business of the Company and the Subsidiaries in the
State of Delaware) to the Documents;
(d) the corporate power and authority of each of the parties (other
than the Company or the Subsidiaries) to the Documents to enter into and perform
their respective obligations under the Documents;
(e) the due authorization, execution and delivery by all of the
parties (other than the Company or the Subsidiaries) to each of the Documents;
(f) that each of the Documents constitutes the legal, valid and
binding obligations of all of the parties thereto (other than the Company or the
Subsidiaries) enforceable against each of such parties in accordance with their
respective terms; and
(g) that the Documents accurately describe and contain the
understandings of the parties, and that there are no oral or written statements
or agreements that modify, amend or vary, or purport to modify, amend or vary,
any of the terms of the Documents.
In rendering the opinions expressed below, we have made no independent
investigation with respect to any matter in connection with which we did not
represent the Company and the Subsidiaries. To render these opinions, we have
relied upon the actual knowledge of the attorneys in our firm who have devoted
substantial attention to the transactions contemplated by the Underwriting
Agreement, and not to the knowledge of the firm generally. All references in
this opinion to the "knowledge" of this firm or to matters with respect to which
it is "aware" are to be construed as to the actual knowledge of such attorneys
and are subject to this limitation. Without limiting the generality of the
foregoing, we have not made any search of the dockets or other public records of
any court or administrative agency or governmental authority with respect to
pending suits, actions, claims, investigations, proceedings, judgments, orders
or decrees or with respect to assessments, mortgages, security interests or
encumbrances.
Based upon the foregoing, we are of the opinion that, subject to the
qualifications discussed herein, as of the date hereof:
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 4
(i) The Company and each of the Subsidiaries have been duly
incorporated and are validly existing and in good standing under the laws of
their respective jurisdictions of incorporation, and have the corporate power
and authority to own or hold their respective properties and to conduct the
businesses in which they are currently engaged and as described in the
Prospectus.
(ii) All of the outstanding capital stock of the Company (other than
the Stock) has been duly and validly authorized and issued, is fully paid and
non-assessable and conforms in all material respects to the description thereof
contained in the Prospectus. With respect to the shares of Stock being
delivered pursuant to the Underwriting Agreement, such Stock has been duly and
validly authorized, and upon receipt of payment therefor, shall be duly issued,
fully paid and non-assessable. The Stock conforms in all material respects to
the description thereof contained in the Prospectus. All of the outstanding
capital stock of each Subsidiary has been duly and validly authorized and issued
and is fully paid, non-assessable and, to our knowledge, is owned by the Company
free and clear of all liens, encumbrances, equities or claims, except for any
liens, encumbrances, equities or claims (a) of Xxxxxx Financial, Inc. ("Xxxxxx")
------
under the Pledge Agreements, or (b) which may be described in the Prospectus.
(iii) Except as may be described in the Prospectus, (a) there are no
preemptive or other rights in the Company's certificate of incorporation or
bylaws to subscribe for or to purchase, nor any restriction upon the voting or
transfer of, any shares of Stock and (b) to our knowledge, there are no
preemptive or other rights to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, any shares of Stock in any other agreement or
instrument.
(iv) To our knowledge, neither the Company nor any of the Subsidiaries
own any real property other than the real property located in Baltimore,
Maryland. To our knowledge, the Company and each of the Subsidiaries have
marketable title to all personal property owned by them, free and clear of all
liens, encumbrances and defects, except (A) liens arising under that certain
Credit Agreement, dated as of November 30, 1995, between Coinmach and Xxxxxx,
(B) purchase money liens arising in the ordinary course of business, and (C)
such liens, encumbrances and defects that do not materially interfere with the
use made and proposed to be made, as described in the Registration Statement, of
such personal property by the Company or any Subsidiary. To our knowledge, all
real property and buildings held under lease by the Company and the Subsidiaries
are held by them under valid, subsisting and enforceable leases, except (A)
laundry room or location leases entered into by the Company or any of the
Subsidiaries, (B) the Company's facility located in
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 5
Roslyn, New York, (C) any real property or buildings the failure of which to so
hold would not be reasonably expected to result in a Material Adverse Effect,
and (D) to the extent that such validity or enforceability may be limited by (1)
bankruptcy, insolvency, fraudulent conveyance, preferential transfer,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting creditors' rights and remedies generally; (2) general
principles of equity (whether such enforceability is considered in a proceeding
in equity or at law), and by the discretion of the court before which any
proceeding therefor may be brought, including, without limitation, (x) the
possible unavailability of specific performance, injunctive relief or any other
equitable remedy, and (y) concepts of materiality, reasonableness, good faith
and fair dealing.
(v) To our knowledge and other than as set forth in the Prospectus,
there are no legal or governmental proceedings pending to which the Company or
any of the Subsidiaries is a party or of which any property or assets of the
Company or any of the Subsidiaries is the subject that, if determined adversely
to the Company or any of the Subsidiaries, might reasonably be expected to have
a Material Adverse Effect; and, to our knowledge, no such proceedings are
threatened by governmental authorities or by others except as disclosed in the
Prospectus.
(vi) The First Registration Statement was declared effective under the
Securities Act as of 5:00 p.m. July 17, 1996; the Second Registration Statement
was declared effective on July 18, 1996; the Prospectus was filed with the
Securities and Exchange Commission pursuant to subparagraph (1) of Rule 424(b)
of the rules and regulations promulgated under the Securities Act (the "Rules
-----
and Regulations") on July 18, 1996; and, to our knowledge, no stop order
---------------
suspending the effectiveness of the Registration Statement has been issued and,
to our knowledge, no proceeding for that purpose is pending.
(vii) The Registration Statement and the Prospectus and any further
amendments or supplements thereto made by the Company prior to the Delivery Date
(other than the financial statements and related schedules therein, as to which
financial statements and related schedules we express no opinion) comply as to
form in all material respects with the requirements of the Securities Act and
the Rules and Regulations.
(viii) To our knowledge, there are no contracts or other documents
that are required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and Regulations
that have not been described in the Prospectus or filed as exhibits to the
Registration Statement.
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 6
(ix) The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
(x) The issuance and sale of the shares of Stock being delivered on
the Delivery Date by the Company and the compliance by the Company with the
provisions of the Underwriting Agreement will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument, in each such case known to us and to which the Company
or any of the Subsidiaries is a party or by which any of the property or assets
of the Company or of any of the Subsidiaries is subject, except for any such
conflicts, breaches, violations or defaults that would not reasonably be
expected to result in a Material Adverse Effect, nor will such actions result in
(i) any violation of the provisions of the Second Amended and Restated
Certificate of Incorporation of the Company or the Second Amended and Restated
By-laws of the Company or the charter or by-laws of any of the Subsidiaries, or
(ii) to our knowledge, any violation of any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of the Subsidiaries or any of their properties or assets and
which could reasonably be expected to result in a Material Adverse Effect.
Except for the registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may be
required under or by the Securities Exchange Act of 1934, as amended, the
Securities Act, the National Association of Securities Dealers, Inc., the Nasdaq
National Market and applicable state securities laws in connection with the
purchase and distribution of the Stock by the Underwriters, no consent,
approval, authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the execution, delivery and
performance of the Underwriting Agreement by the Company and the consummation of
the transactions contemplated thereby.
(xi) To our knowledge and except as may be described in the
Registration Statement, there are no contracts, agreements or understandings
between the Company or any of the Subsidiaries and any person granting such
person the right (other than rights that have been waived or satisfied) to
require the Company to file a registration statement under the Securities Act
with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the securities
registered pursuant to the Registration Statement.
In addition, we have participated in conferences with officers and
other representatives of the Company, representatives of the independent public
accountants for the Company, and representatives of you and your counsel, at
which the contents of the
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 7
Registration Statement and Prospectus and related matters were discussed and,
although we did not independently verify, we are not passing upon, and do not
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement and Prospectus (except for
the statements made in the Registration Statement under the caption "Description
of Capital Stock" and "Shares Eligible for Future Resale" insofar as such
statements relate to the Stock and concern legal matters), on the basis of the
foregoing (relying as to materiality to a large extent upon the statements of
officers and other representatives of the Company) no facts have come to our
attention that cause us to believe that (i) the Registration Statement, as of
the date and time as of which the First Registration Statement is declared
effective by the Securities and Exchange Commission, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
(ii) the Prospectus, as of its date and as of the date hereof, 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 light of
the circumstances under which they were made, not misleading; it being
understood that we are not commenting on and express no opinion with respect to
the financial statements and related notes thereto, schedules or other financial
or statistical data included in or omitted from the Registration Statement, the
Prospectus or any amendments or supplements thereto.
Our opinions set forth above are subject to the following additional
qualifications:
(a) Our opinions are limited to the specific issues addressed herein
and are limited in all respects to the laws as they exist as of the date hereof
and the facts as stated herein and purport to express what a court would
conclude based on such facts. By rendering our opinions, we do not undertake to
advise you of any changes in such laws or facts which may occur on or after the
date hereof.
(b) We express no opinion as to, or the effect or applicability of,
any laws other than the laws of the State of New York, the Federal laws of the
United States of America and the General Corporation Law of the State of
Delaware. We assume no responsibility with respect to the application to the
subject transactions, or the effect thereon, of the laws of any other
jurisdiction.
Xxxxxx Brothers Inc.
Xxxxxx, Read & Co. Inc.
Lazard Freres & Co. LLC
Fieldstone FPCG Services, L.P.
July 23, 1996
Page 8
This opinion is being rendered only to you for your exclusive benefit
and is intended to be relied upon by you in connection with the transactions
contemplated by the Underwriting Agreement. This opinion is not to be quoted in
whole or in part or otherwise referred to, nor is it to be filed with any
governmental agency or any other person, firm or entity without our prior
written consent. This opinion may not be used for any other purpose, or relied
on by any other person, firm or entity for any purpose, without our prior
written consent.
Very truly yours,
XXXXXXXX KILL & OLICK, P.C., a
New York Professional Corporation
By: /s/ XXXXXX X. XXXXX
---------------------------
Xxxxxx X. Xxxxx,
a Member of the Firm
SCHEDULE 1
Number of
Underwriters Shares
------------ ---------
Xxxxxx Brothers Inc............................ 681,500
Xxxxxx, Read & Co. Inc......................... 681,500
Lazard Freres & Co. LLC........................ 681,500
Fieldstone Private Capital Group............... 681,500
Alex. Xxxxx & Sons Incorporated................ 103,000
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation.................................. 103,000
X.X. Xxxxxxx & Sons, Inc....................... 103,000
Everen Securities, Inc......................... 103,000
Xxxxxxx, Xxxxx & Co............................ 103,000
Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated........................... 103,000
Xxxxxx Xxxxxxx & Co. Incorporated.............. 103,000
Xxxxx Xxxxxx Inc............................... 103,000
Xxxxxx X. Xxxxx & Co. Incorporated............. 57,000
Doft & Co., Inc................................ 57,000
Xxxxxxxxxx & Co., Inc.......................... 57,000
Gilford Securities Incorporated................ 57,000
McDonald & Company Securitries, Inc............ 57,000
Xxxxxxx Xxxxx Securities Inc................... 57,000
Xxxxxxx Xxxxx & Associates, Inc................ 57,000
Xxxxxx, Xxxxxxxx & Company, Incorporated....... 57,000
Sutro & Co. Incorporated....................... 57,000
Unterberg Harris............................... 57,000
TOTAL 4,120,000
=========
