1
Exhibit 1.1
RENTAL SERVICE CORPORATION
5,280,000 Shares Common Stock(1)
UNDERWRITING AGREEMENT
May 29, 1997
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Section 1. Introductory. Rental Service Corporation ("Company") a Delaware
corporation, will have, as of the First Closing Date hereinafter defined, an
authorized capital stock consisting of 500,000 shares of Preferred Stock, $.01
par value, of which no shares were outstanding as of May 29, 1997 and 20,000,000
shares, $.01 par value, of Common Stock ("Common Stock"), of which 11,571,777
shares were outstanding as of such date. The Company proposes to issue and sell
3,000,000 shares of its authorized but unissued Common Stock, and certain
stockholders of the Company (collectively referred to as the "Selling
Stockholders" and named in Schedule B) propose to sell 2,280,000 shares of the
Company's issued and outstanding Common Stock to the underwriters named in
Schedule A as it may be amended by the Pricing Agreement hereinafter defined
("Underwriters"), who are acting severally and not jointly. Collectively, such
total of 5,280,000 shares of Common Stock proposed to be sold by the Company and
the Selling Stockholders is hereinafter referred to as the "Firm Shares." In
addition, certain Selling Stockholders propose to grant to the Underwriters an
option to purchase up to 792,000 additional shares of Common Stock ("Option
Shares") as provided in Section 5 hereof. The Firm Shares and, to the extent
such option is exercised, the Option Shares, are hereinafter collectively
referred to as the "Shares."
You have advised the Company and the Selling Stockholders that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon as you deem advisable after the registration statement
hereinafter referred to becomes effective, if it has not yet become effective,
and the Pricing Agreement hereinafter defined has been executed and delivered.
Prior to the purchase and public offering of the Shares by the several
Underwriters, the Company, the Selling Stockholders and the Underwriters shall
enter into an agreement substantially in the form of Exhibit A hereto ("Pricing
Agreement"). The Pricing Agreement may take the form of an exchange of any
standard form of written telecommunication between the Company, the Selling
Stockholders and the Underwriters and shall specify such applicable information
as is indicated in Exhibit A hereto. The offering of the Shares will be
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(1) Plus an option to acquire up to 792,000 additional shares to cover over
allotments.
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governed by this Agreement, as supplemented by the Pricing Agreement. From and
after the date of the execution and delivery of the Pricing Agreement, this
Agreement shall be deemed to incorporate the Pricing Agreement.
The Company and each of the Selling Stockholders hereby confirm their
agreements with the Underwriters as follows:
Section 2. Representations and Warranties of the Company. The Company
represents and warrants to the several Underwriters and the Selling Stockholders
that:
(a) A registration statement on Form S-1 (File No. 333-26753 ) and a
related preliminary prospectus with respect to the Shares have been
prepared and filed with the Securities and Exchange Commission
("Commission") by the Company in conformity with the requirements of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "1933 Act;" unless indicated to
the contrary, all references herein to specific rules are rules
promulgated under the 0000 Xxx); and the Company has so prepared and has
filed such amendments thereto, if any, and such amended preliminary
prospectuses as may have been required to the date hereof and will file
such additional amendments thereto and such amended prospectuses as may
hereafter be required. There have been or will promptly be delivered to
you three signed copies of such registration statement and amendments,
three copies of each exhibit filed therewith, and conformed copies of such
registration statement and amendments (but without exhibits) and of the
related preliminary prospectus or prospectuses and final forms of
prospectus for each of the Underwriters in such amounts as you shall
reasonably request.
Such registration statement (as amended, if applicable) at the
time it becomes effective and the prospectus constituting a part thereof
(including the information, if any, deemed to be part thereof pursuant to
Rule 430A(b) and/or Rule 434), as from time to time amended or
supplemented, are hereinafter referred to as the "Registration Statement,"
and the "Prospectus," respectively, except that if any revised prospectus
shall be provided to the Underwriters by the Company for use in connection
with the offering of the Shares which differs from the Prospectus on file
at the Commission at the time the Registration Statement became or becomes
effective (whether or not such revised prospectus is required to be filed
by the Company pursuant to Rule 424(b)), the term Prospectus shall refer
to such revised prospectus from and after the time it was provided to the
Underwriters for such use. If the Company elects to rely on Rule 434 of
the 1933 Act, all references to "Prospectus" shall be deemed to include,
without limitation, the form of prospectus and the term sheet, taken
together, provided to the Underwriters by the Company in accordance with
Rule 434 of the 1933 Act ("Rule 434 Prospectus"). Any registration
statement (including any amendment or supplement thereto or information
which is deemed part thereof) filed by the Company under Rule 462(b)
("Rule 462(b) Registration Statement") shall be deemed to be part of the
"Registration Statement" as defined herein, and any prospectus (including
any amendment or supplement thereto or information which is deemed part
thereof) included in such registration statement shall be deemed to be
part of the "Prospectus", as defined herein, as appropriate. The
Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission thereunder are hereinafter collectively referred to as
the "Exchange Act."
(b) The Commission has not issued any order preventing or suspending
the use of any preliminary prospectus, and each preliminary prospectus has
conformed in all material respects with the requirements of the 1933 Act
and, as of its date, has not included any untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading; and when the Registration Statement became
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or becomes effective, and at all times subsequent thereto, up to the First
Closing Date or the Second Closing Date hereinafter defined, as the case
may be, the Registration Statement, including the information deemed to be
part of the Registration Statement at the time of effectiveness pursuant
to Rule 430A(b), if applicable, and the Prospectus and any amendments or
supplements thereto, contained or will contain all statements that are
required to be stated therein in accordance with the 1933 Act and in all
material respects conformed or will in all material respects conform to
the requirements of the 1933 Act, and neither the Registration Statement
nor the Prospectus, nor any amendment or supplement thereto, included or
will include any untrue statement of a material fact or omitted or will
omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, however, that the
Company makes no representation or warranty as to information contained in
or omitted from any preliminary prospectus, the Registration Statement,
the Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by or on
behalf of (x) any Underwriter expressly for use in the preparation thereof
(it being understood and agreed by the parties hereto that the only
written information furnished to the Company by or on behalf of the
Underwriters is the written information described in Section 4 hereof) or
(y) any Selling Stockholder expressly for use in the preparation thereof.
(c) The Company and its subsidiaries have been duly incorporated and
are validly existing as corporations in good standing under the laws of
their respective jurisdictions of incorporation, with corporate power and
authority to own their properties and conduct their business as described
in the Prospectus; the Company and each of its subsidiaries are duly
qualified to do business as foreign corporations under the corporation law
of, and are in good standing as such in, each jurisdiction in which they
own or lease substantial properties, have an office, or in which
substantial business is conducted and such qualification is required
except in any such case where the failure to so qualify or be in good
standing would not have a material adverse effect upon the business,
condition (financial or otherwise) or results of operations of the Company
and its subsidiaries taken as a whole (a "Material Adverse Effect"); and
no proceeding of which the Company has knowledge has been instituted in
any such jurisdiction, revoking, limiting or curtailing, or seeking to
revoke, limit or curtail, such power and authority or qualification.
(d) Except as disclosed in the Registration Statement (including,
but not limited to, contracts filed as exhibits to the Registration
Statement), the Company owns directly or indirectly 100 percent of the
issued and outstanding capital stock of each of its subsidiaries, free and
clear of any claims, liens, encumbrances or security interests and all of
such capital stock has been duly authorized and validly issued and is
fully paid and nonassessable.
(e) The issued and outstanding shares of capital stock of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable, and conform to the description thereof contained in the
Prospectus.
(f) The Shares to be sold by the Company have been duly authorized
and when issued, delivered and paid for pursuant to this Agreement, will
be validly issued, fully paid and nonassessable, and will conform to the
description thereof contained in the Prospectus.
(g) The making and performance by the Company of this Agreement and
the Pricing Agreement have been duly authorized by all necessary corporate
action and will not violate any provision of the Company's charter or
bylaws, each as amended to date, and will not result in the breach, or be
in
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contravention, of any provision of any agreement, franchise, license,
indenture, mortgage, deed of trust, or other instrument to which the
Company or any subsidiary is a party or by which the Company, any
subsidiary or the property of any of them may be bound or affected, or any
order, rule or regulation applicable to the Company or any subsidiary of
any court or regulatory body, administrative agency or other governmental
body having jurisdiction over the Company or any subsidiary or any of
their respective properties, or any order of any court or governmental
agency or authority entered in any proceeding to which the Company or any
subsidiary was or is now a party or by which it is bound, except for any
breach or contravention which, singly or in the aggregate, would not have
a Material Adverse Effect. No consent, approval, authorization or other
order of any court, regulatory body, administrative agency or other
governmental body is required for the execution and delivery of this
Agreement or the Pricing Agreement or the consummation of the transactions
contemplated herein or therein, except for compliance with the 1933 Act,
the Exchange Act and blue sky laws applicable to the public offering of
the Shares by the several Underwriters and clearance of such offering with
the National Association of Securities Dealers, Inc. ("NASD"). This
Agreement has been duly executed and delivered by the Company.
(h) Ernst & Young LLP are independent accountants with respect to
the Company and its subsidiaries as required by the 1933 Act.
(i) The consolidated financial statements together with the related
notes and schedules of the Company included in the Registration Statement
present fairly the consolidated financial position of the Company as of
the respective dates of such financial statements, and the consolidated
results of operations and cash flows of the Company for the respective
periods covered thereby, all in conformity with generally accepted
accounting principles consistently applied throughout the periods
involved, except as disclosed in the Prospectus, and the supporting
schedules included in the Registration Statement present fairly the
information required to be stated therein. The financial information set
forth in the Prospectus under "Selected Consolidated Financial Information
and Operating Data" presents fairly on the basis stated in the Prospectus,
the information set forth therein.
The unaudited pro forma consolidated financial statements and
other unaudited pro forma information included in the Prospectus present
fairly in all material respects the information shown therein, have been
prepared in accordance with generally accepted accounting principles and
the Commission's rules and guidelines with respect to pro forma financial
statements and other pro forma information, have been properly compiled on
the pro forma basis described therein, and, in the opinion of the Company,
the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate under the circumstances.
(j) (x) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or in default under any consent
decree, or in default with respect to any material provision of any lease,
loan agreement, franchise, license, permit or other contract obligation to
which it is a party; and (y) to the Company's knowledge, there does not
exist any state of facts which constitutes an event of default as defined
in such documents or which, with notice or lapse of time or both, would
constitute such an event of default, except in the case of clauses (x) and
(y) for defaults, events of default and violations which neither singly
nor in the aggregate are material to the Company and its subsidiaries
taken as a whole.
(k) There are no legal or governmental proceedings pending
(including, without limitation, proceedings related to environmental or
discrimination matters) or, to the Company's knowledge,
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threatened to which the Company or any subsidiary is a party or of which
property owned or leased by the Company or any subsidiary is the subject,
or which are not disclosed in the Prospectus and which, if decided
adversely to the Company or such subsidiaries, are reasonably expected to
have a Material Adverse Effect or which question the validity of this
Agreement or the Pricing Agreement or any action taken or to be taken
pursuant hereto or thereto.
(l) There are no holders of securities of the Company having rights
to registration thereof or preemptive rights to purchase Common Stock
except as disclosed in the Prospectus. Holders of registration rights who
are not Selling Stockholders received proper notice from the Company with
respect to such rights and have not exercised such rights with respect to
the offering being made by the Prospectus.
(m) The Company and each of its subsidiaries have good and
marketable title to all the properties and assets reflected as owned in
the financial statements hereinabove described (or elsewhere in the
Registration Statement), subject to no lien (except liens for taxes not
yet due and payable), mortgage, pledge, charge or encumbrance of any kind
except those, if any, reflected in such financial statements (or elsewhere
in the Registration Statement (including, but not limited to, contracts
filed as exhibits to the Registration Statement)) or which are not
material to the Company and its subsidiaries taken as a whole. The Company
and each of its subsidiaries hold their respective leased properties which
are material to the Company and its subsidiaries taken as a whole under
valid and binding leases.
(n) The Company has not taken and will not take, directly or
indirectly, any action designed to or which has constituted or which might
reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Shares.
(o) Subsequent to the respective dates as of which information is
given in the Registration Statement and Prospectus, and except as
contemplated by the Registration Statement, the Company and its
subsidiaries, taken as a whole, have not incurred any material liabilities
or obligations, direct or contingent, nor entered into any material
transactions not in the ordinary course of business and there has not been
any material adverse change in their condition (financial or otherwise) or
results of operations nor any material adverse change in their capital
stock, short-term debt or long-term debt.
(p) The Company agrees not to sell, contract to sell or otherwise
dispose of any Common Stock or securities convertible into Common Stock
(except Common Stock issued pursuant to currently outstanding options,
warrants or convertible securities) for a period of 90 days after the
effective date of the Registration Statement without the prior written
consent of Xxxxxxx Xxxxx & Company, L.L.C. Notwithstanding the foregoing,
during such 90-day period the Company may (i) grant stock options and
purchase rights to employees of the Company under the 1995 Plan, the 1996
Plan and the QSP Plan (each as defined in the Registration Statement),
(ii) issue shares of common stock upon the conversion or exercise of
options and warrants which are outstanding as of the date hereof and (iii)
register shares of common stock underlying the QSP Plan and (iv) issue
shares in connection with the Foxx and Central States acquisitions (each
as defined in the Registration Statement).
(q) There is no material document of a character required to be
described in the Registration Statement or the Prospectus or to be filed
as an exhibit to the Registration Statement which is not described or
filed as required by the 1933 Act.
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(r) The Company together with its subsidiaries owns and possesses
all right, title and interest in and to, or has duly licensed from third
parties, all patents, patent rights, trade secrets, inventions, know-how,
trademarks, trade names, copyrights, service marks and other proprietary
rights ("Trade Rights"), if any, which are material to the business of the
Company and its subsidiaries taken as a whole. Neither the Company nor any
of its subsidiaries has received any notice of infringement,
misappropriation or conflict from any third party as to such material
Trade Rights which has not been resolved or disposed of and, to the
knowledge of the Company, neither the Company nor any of its subsidiaries
has infringed, misappropriated or otherwise conflicted with material Trade
Rights of any third parties, which infringement, misappropriation or
conflict would have a Material Adverse Effect.
(s) The conduct of the business of the Company and each of its
subsidiaries is in compliance in all respects with applicable federal,
state, local and foreign laws and regulations, except where the failure to
be in compliance would not, singly or in the aggregate, have a Material
Adverse Effect.
(t) All sales of the Company's capital stock prior to the date
hereof were either (1) made pursuant to a registration statement filed by
the Company with the Commission under the 1933 Act or (2) at all relevant
times exempt from the registration requirements of the 1933 Act and in
cases (1) and (2) duly registered with or the subject of an available
exemption from the registration requirements of the applicable state
securities or blue sky laws.
(u) The Company has filed all necessary federal and state income and
franchise tax returns and has paid all taxes shown as due thereon other
than those (i) currently payable without penalty or interest or (ii) the
failure of which to pay would not have a Material Adverse Effect; and
there is no tax deficiency that has been asserted against the Company or
any of its properties or assets that would have a Material Adverse Effect.
(v) A registration statement (pursuant to Section 12(b) of the
Exchange Act) relating to the Common Stock has been declared effective by
the Commission pursuant to the Exchange Act and the Common Stock is duly
registered thereunder. The Shares have been listed on the New York Stock
Exchange.
(w) The Company is not an "investment company" as defined in Section
3(a) of the Investment Company Act of 1940, as amended ("Investment
Company Act").
(x) The Company confirms as of the date hereof that it is in
compliance with all provisions of Section 517.075, Florida Statutes
(Chapter 92-198, Laws of Florida).
SECTION 3. Representations, Warranties and Covenants of the Selling
Stockholders.
(a) Each Selling Stockholder severally, and not jointly, represents
and warrants to, and agrees with, the Company and the Underwriters that:
(i) Such Selling Stockholder has, and on the First Closing
Date or the Second Closing Date, as the case may be, will have,
valid marketable title to the Shares proposed to be sold by such
Selling Stockholder hereunder on such date and full right, power and
authority to enter into this Agreement and the Pricing Agreement and
to sell, assign, transfer and deliver such Shares hereunder, free
and clear of all voting trust arrangements, liens, encumbrances,
equities,
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claims and community property rights; and upon delivery of and
payment for such Shares hereunder, the Underwriters will acquire
valid marketable title thereto, free and clear of any voting trust
arrangement, lien, encumbrance, equity, claim and community property
right other than imposed upon or consented to in writing by an
Underwriter.
(ii) The making and performance by such Selling Stockholder of
this Agreement and the Pricing Agreement (A), if such Selling
Stockholder is not an individual, have been duly authorized by all
necessary action and (B), if such Selling Stockholder is not an
individual, will not violate any provision of such Selling
Stockholder's charter, bylaws, partnership agreement or trust
agreement, as the case may be and (C) will not result in the breach,
or be in contravention, of any provision of any trust agreement,
franchise, license, indenture, mortgage, deed of trust, or other
instrument to which such Selling Stockholder is a party or by which
such Selling Stockholder or the property of such Selling Stockholder
may be bound or affected, or any order, rule or regulation
applicable to such Selling Stockholder of any court or regulatory
body, administrative agency or other governmental body having
jurisdiction over such Selling Stockholder or any of such Selling
Stockholder's properties, or any order of any court or governmental
agency or authority entered in any proceeding to which such Selling
Stockholder was or is now a party or by which it is bound, and which
would have a material adverse effect on such Selling Stockholder's
ability to perform its obligations under this Agreement. No consent,
approval, authorization or other order of any court, regulatory
body, administrative agency or other government body is required for
the execution and delivery of this Agreement or the Pricing
Agreement or the consummation of the transactions contemplated
herein or therein, except for compliance with the 1933 Act and blue
sky laws applicable to the public offering of the Shares by the
several Underwriters and clearance of such offering with the NASD.
This Agreement has been duly executed and delivered by or on behalf
of such Selling Stockholder.
(iii) Such Selling Stockholder has not taken and will not
take, directly or indirectly, any action designed to or which might
be reasonably expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares.
(iv) Such Selling Stockholder has executed and delivered a
Power of Attorney ("Power of Attorney") among the Selling
Stockholder, Xxxxxx X. Xxxx and Xxxxxxx X. Xxxxxxxx (the "Agents"),
naming the Agents as such Selling Stockholder's attorneys-in-fact
for the purpose of entering into and carrying out this Agreement and
the Pricing Agreement on behalf of such Selling Stockholder, and the
Power of Attorney has been duly executed by such Selling Stockholder
and a copy thereof has been delivered to you.
(v) Such Selling Stockholder further represents, warrants and
agrees that such Selling Stockholder has deposited in custody, under
a Custody Agreement ("Custody Agreement") with Xxxxxxx X. Xxxxxxxx,
as custodian ("Custodian"), certificates in negotiable form for the
Shares to be sold hereunder by such Selling Stockholder, for the
purpose of further delivery pursuant to this Agreement. Such Selling
Stockholder agrees that the Shares to be sold by such Selling
Stockholder on deposit with the Custodian are subject to the
interests of the Company, the Underwriters and the other Selling
Stockholders, that the arrangements made for such custody, and the
appointment of the Agents pursuant to the Power of Attorney, are to
that extent irrevocable, and that the obligations of such Selling
Stockholder hereunder and under the
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Power of Attorney and the Custody Agreement shall not be terminated
except as provided in this Agreement, the Power of Attorney or the
Custody Agreement by any act of such Selling Stockholder, by
operation of law, whether, in the case of an individual Selling
Stockholder, by the death or incapacity of such Selling Stockholder
or, in the case of a trust or estate, by the death of the trustee or
trustees or the executor or executors or the termination of such
trust or estate, or, in the case of a partnership or corporation, by
the dissolution, winding-up or other event affecting the legal life
of such entity, or by the occurrence of any other event. If any
individual Selling Stockholder, trustee or executor should die or
become incapacitated, or any such trust, estate, partnership or
corporation should be terminated, or if any other event should occur
before the delivery of the Shares hereunder, the documents
evidencing Shares then on deposit with the Custodian shall be
delivered by the Custodian in accordance with the terms and
conditions of this Agreement as if such death, incapacity,
termination or other event had not occurred, regardless of whether
or not the Custodian shall have received notice thereof. Each Agent
has been authorized by such Selling Stockholder to execute and
deliver this Agreement and the Pricing Agreement and the Custodian
has been authorized to receive and acknowledge receipt of the
proceeds of sale of the Shares to be sold by such Selling
Stockholder against delivery thereof and otherwise act on behalf of
such Selling Stockholder. The Custody Agreement has been duly
executed by such Selling Stockholder and a copy thereof has been
delivered to you.
(vi) Each preliminary prospectus, solely with respect to
information provided in writing by such Selling Stockholder for
inclusion therein as of its date, has not included any untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; and with
respect to the Registration Statement at the time of effectiveness,
and at all times subsequent thereto, up to the First Closing Date or
the Second Closing Date, as the case may be, neither the
Registration Statement nor the Prospectus, nor any amendment or
supplement thereto, solely with respect to information provided in
writing by such Selling Stockholder for inclusion therein, included
or will include any untrue statement of a material fact or omitted
or will omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; provided that the foregoing clause shall not have any
effect if information has been given by such Selling Stockholder to
the Company and the Underwriters in writing which would eliminate or
remedy any such untrue statement or omission. It is agreed that the
only information provided with respect to each Selling Stockholder
is such information as set forth in the Prospectus under the caption
"Principal and Selling Stockholders" which specifically relates to
such Selling Stockholder.
(b) Each Selling Stockholder agrees with the Company and the
Underwriters not to sell, contract to sell or otherwise dispose of any
Common Stock for a period of 90 days after this Agreement becomes
effective without the prior written consent of Xxxxxxx Xxxxx & Company,
L.L.C.
In order to document the Underwriter's compliance with the reporting and
withholding provisions of the Internal Revenue Code of 1986, as amended, with
respect to the transactions herein contemplated, each of the Selling
Stockholders agrees to deliver to you prior to or on the First Closing Date, as
hereinafter defined, a properly completed and executed United States Treasury
Department Form W-8 or W-9 (or other applicable form of statement specified by
Treasury Department regulations in lieu thereof).
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SECTION 4. Representations and Warranties of the Underwriters. The
Underwriters represent and warrant to the Company and the Selling Stockholders
that the information set forth (a) on the cover page of the Prospectus with
respect to price, underwriting discount and terms of the offering and (b) under
"Underwriting" in the Prospectus and (c) on the inside front cover of the
Prospectus with respect to the stabilization legend was furnished to the Company
by and on behalf of the Underwriters for use in connection with the preparation
of the Registration Statement and is correct and complete in all material
respects. The Company and the Selling Stockholders hereby acknowledge and agree
that the information described in this Section 4 was the only written
information furnished to the Company by or on behalf of any Underwriter for use
in the preparation of the Registration Statement and Prospectus.
SECTION 5. Purchase, Sale and Delivery of Shares. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company and the Selling Stockholders,
severally and not jointly, agree to sell to the Underwriters named in Schedule A
hereto, and the Underwriters agree, severally and not jointly, to purchase from
the Company and the Selling Stockholders, respectively, 3,000,000 Firm Shares
from the Company and the respective number of Firm Shares set forth opposite the
names of the Selling Stockholders in Schedule B hereto at the price per share
set forth in the Pricing Agreement. The obligation of each Underwriter to the
Company shall be to purchase from the Company that number of full shares which
(as nearly as practicable, as determined by you) bears to 3,000,000 the same
proportion as the number of Shares set forth opposite the name of such
Underwriter in Schedule A hereto bears to the total number of Firm Shares to be
purchased by all Underwriters under this Agreement. The obligation of each
Underwriter to each Selling Stockholder shall be to purchase from such Selling
Stockholder the number of full shares which (as nearly as practicable, as
determined by you) bears to that number of Firm Shares set forth opposite the
name of such Selling Stockholder in Schedule B hereto, the same proportion as
the number of Shares set forth opposite the name of such Underwriter in Schedule
A hereto bears to the total number of Firm Shares to be purchased by all
Underwriters under this Agreement. The initial public offering price and the
purchase price shall be set forth in the Pricing Agreement.
At 9:00 A.M., Chicago Time, on the fourth business day, if permitted under
Rule 15c6-1 under the Exchange Act, (or the third business day if required under
Rule 15c6-1 under the Exchange Act or unless postponed in accordance with the
provisions of Section 12) following the date the Registration Statement becomes
effective (or, if the Company has elected to rely upon Rule 430A, the fourth
business day, if permitted under Rule 15c6-1 under the Exchange Act, (or the
third business day if required under Rule 15c6-1 under the Exchange Act) after
execution of the Pricing Agreement), or such other time not later than ten
business days after such date as shall be agreed upon by the Underwriters and
the Company, the Company and the Custodian will deliver to you at the offices of
counsel for the Underwriters or through the facilities of The Depository Trust
Company for the accounts of the several Underwriters, certificates representing
the Firm Shares to be sold by the Company and for the benefit of the Selling
Stockholders, respectively, against payment of the purchase price therefor by
delivery of federal or other immediately available funds, by wire transfer or
otherwise, to the Company and the Custodian. Such time of delivery and payment
is herein referred to as the "First Closing Date." The certificates for the Firm
Shares so to be delivered will be in such denominations and registered in such
names as you request by notice to the Company and the Custodian prior to 10:00
A.M., Chicago Time, on the second business day preceding the First Closing Date,
and will be made available at the Company's expense for checking and packaging
by the Underwriters at 10:00 A.M., Chicago Time, on the business day preceding
the First Closing Date. Payment for the Firm Shares so to be delivered shall be
made at the time and in the manner described above at the offices of counsel for
the Underwriters.
In addition, on the basis of the representations, warranties and
agreements herein contained, but subject to the terms and conditions herein set
forth, certain of the Selling Stockholders designated on Schedule B to be
offering Option Shares hereby grant an option to the several Underwriters to
purchase, severally and not jointly,
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up to an aggregate of 792,000 Option Shares, at the same purchase price per
share to be paid for the Firm Shares, for use solely in covering any over
allotments made by the Underwriters in the sale and distribution of the Firm
Shares. The option granted hereunder may be exercised at any time (but not more
than once) within 30 days after the date of the initial public offering upon
notice by you to the Company and the Agents setting forth the aggregate number
of Option Shares as to which the Underwriters are exercising the option, the
names and denominations in which the certificates for such shares are to be
registered and the time and place at which such certificates will be delivered.
Such time of delivery (which may not be earlier than the First Closing Date),
being herein referred to as the "Second Closing Date," shall be determined by
you, but if at any time other than the First Closing Date, shall not be earlier
than three nor later than 10 full business days after delivery of such notice of
exercise. The number of Option Shares to be purchased from each such Selling
Stockholder are set forth in Schedule B hereto. The number of Option Shares to
be purchased by each Underwriter shall be determined by multiplying the number
of Option Shares to be sold by the Selling Stockholders pursuant to such notice
of exercise by a fraction, the numerator of which is the number of Firm Shares
to be purchased by such Underwriter as set forth opposite its name in Schedule A
and the denominator of which is the total number of Firm Shares (subject to such
adjustments to eliminate any fractional share purchases as you in your absolute
discretion may make). Certificates for the Option Shares will be made available
at the Company's expense for checking and packaging at 10:00 A.M., Chicago Time,
on the business day preceding the Second Closing Date. The manner of payment for
and delivery of the Option Shares shall be the same as for the Firm Shares as
specified in the preceding paragraph.
SECTION 6. Covenants of the Company. The Company covenants and agrees
that:
(a) The Company will advise you and the Selling Stockholders
promptly of its notice of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the
institution of any proceedings for that purpose, or of any notification to
it of the suspension of qualification of the Shares for sale in any
jurisdiction or the initiation or threatening of any proceedings for that
purpose, and will also advise you and the Selling Stockholders promptly of
any request of the Commission for amendment or supplement of the
Registration Statement, of any preliminary prospectus or of the
Prospectus, or for additional information.
(b) The Company will give you and the Selling Stockholders notice of
its intention to file or prepare any amendment to the Registration
Statement (including any post-effective amendment) or any Rule 462(b)
Registration Statement or any amendment or supplement to the Prospectus
(including any revised prospectus which the Company proposes for use by
the Underwriters in connection with the offering of the Shares which
differs from the prospectus on file at the Commission at the time the
Registration Statement became or becomes effective, whether or not such
revised prospectus is required to be filed pursuant to Rule 424(b) and any
term sheet as contemplated by Rule 434) and will furnish you and the
Selling Stockholders with copies of any such amendment or supplement a
reasonable amount of time prior to such proposed filing or use, as the
case may be, and will not file any such amendment or supplement or use any
such prospectus to which you or counsel for the Underwriters shall
reasonably object on a timely basis.
(c) If the Company elects to rely on Rule 434 of the 1933 Act, the
Company will prepare a term sheet that complies with the requirements of
Rule 434. If the Company elects not to rely on Rule 434, the Company will
provide the Underwriters with copies of the form of prospectus, in such
numbers as the Underwriters may reasonably request, and file with the
Commission such prospectus in accordance with Rule 424(b) of the 1933 Act
by the close of business in New York City on the second business day
immediately succeeding the date of the Pricing Agreement. If the Company
elects to rely on Rule 434, the Company will provide the Underwriters with
copies of the form of Rule 434 Prospectus,
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in such numbers as the Underwriters may reasonably request, by the close
of business in New York on the business day immediately succeeding the
date of the Pricing Agreement.
(d) If at any time when a prospectus relating to the Shares is
required to be delivered under the 1933 Act any event occurs as a result
of which the Prospectus, including any amendments or supplements, would
include an untrue statement of a material fact, or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend the
Prospectus, including any amendments or supplements thereto and including
any revised prospectus which the Company proposes for use by the
Underwriters in connection with the offering of the Shares which differs
from the prospectus on file with the Commission at the time of
effectiveness of the Registration Statement, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) to comply with
the 1933 Act, the Company promptly will advise you thereof and will
promptly prepare and file with the Commission an amendment or supplement
which will correct such statement or omission or an amendment which will
effect such compliance; and, in case any Underwriter is required to
deliver a prospectus nine months or more after the effective date of the
Registration Statement, the Company upon request, but at the expense of
such Underwriter, will prepare promptly such prospectus or prospectuses as
may be necessary to permit compliance with the requirements of Section
10(a)(3) of the 1933 Act.
(e) Without the prior written consent of the Underwriters, neither
the Company nor any of its subsidiaries will, prior to the earlier of the
Second Closing Date or termination or expiration of the related option,
incur any material liability or obligation, direct or contingent, or enter
into any material transaction, other than in the ordinary course of
business, except as contemplated by the Prospectus.
(f) Except for repurchase by the Company of its capital stock from
employees whose employment may terminate, neither the Company nor any of
its subsidiaries will acquire any capital stock of the Company prior to
the earlier of the Second Closing Date or termination or expiration of the
related option nor will the Company declare or pay any dividend or make
any other distribution upon the Common Stock payable to stockholders of
record on a date prior to the earlier of the Second Closing Date or
termination or expiration of the related option, except in either case as
contemplated by the Prospectus.
(g) The Company will make generally available to its security
holders as soon as reasonably practicable, and in any event not later than
15 months after the effective date of the Registration Statement, a
consolidated earnings statement (which need not be audited) covering a
period of at least 12 months beginning after the effective date of the
Registration Statement, which will satisfy the provisions of the last
paragraph of Section 11(a) of the 1933 Act and Rule 158.
(h) During such period as a prospectus is required by law to be
delivered in connection with offers and sales of the Shares by an
Underwriter or dealer, the Company will furnish to you at its expense,
subject to the provisions of subsection (d) hereof, copies of the
Registration Statement, the Prospectus, each preliminary prospectus and
all amendments and supplements to any such documents in each case as soon
as available and in such quantities as you may reasonably request, for the
purposes contemplated by the 1933 Act.
(i) The Company will cooperate with the Underwriters in qualifying
or registering the Shares for sale under the blue sky laws of such
jurisdictions as you reasonably designate, and will continue such
qualifications in effect so long as reasonably required for the
distribution of the Shares.
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The Company shall not be required to qualify as a foreign corporation or
to file a general consent to service of process in any such jurisdiction
where it is not currently qualified or where it would be subject to
taxation as a foreign corporation.
(j) The Company will use the net proceeds received by it from the
sale of the Shares being sold by it in the manner specified in the
Prospectus in all material respects.
(k) If, at the time of effectiveness of the Registration Statement,
any information shall have been omitted therefrom in reliance upon Rule
430A and/or Rule 434, then following the execution of the Pricing
Agreement, the Company will prepare, and file or transmit for filing with
the Commission in accordance with such Rule 430A, Rule 424(b) and/or Rule
434, copies of an amended prospectus, or, if required by such Rule 430A
and/or Rule 434, a post-effective amendment to the Registration Statement
(including an amended prospectus), containing all information so omitted.
If required, the Company will prepare and file, or transmit for filing, a
Rule 462(b) Registration Statement not later than the date of the
execution of the Pricing Agreement. If a Rule 462(b) Registration
Statement is filed, the Company shall make payment of, or arrange for
payment of, the additional registration fee owing to the Commission
required by Rule 111.
(l) The Company will comply with all applicable registration, filing
and reporting requirements of the Exchange Act and the New York Stock
Exchange.
SECTION 7. Payment of Expenses. Whether or not the transactions
contemplated hereunder are consummated or this Agreement becomes effective as to
all of its provisions or is terminated, the Company agrees to pay (i) all costs,
fees and expenses (other than legal fees and disbursements of counsel for the
Underwriters and the expenses incurred by the Underwriters) incurred in
connection with the performance of the Company's obligations hereunder,
including without limiting the generality of the foregoing, all fees and
expenses of legal counsel for the Company and of the Company's independent
accountants, all costs and expenses incurred in connection with the preparation,
printing, filing and distribution of the Registration Statement, each
preliminary prospectus and the Prospectus (including all exhibits and financial
statements) and all amendments and supplements provided for herein, this
Agreement, the Pricing Agreement and the Blue Sky Memorandum, (ii) all costs,
fees and expenses (including reasonable legal fees not to exceed $18,000)
incurred by the Underwriters in connection with qualifying or registering all or
any part of the Shares for offer and sale under blue sky laws and under the laws
of certain Provinces of Canada, including the preparation of a blue sky
memorandum relating to the Shares, the attainment of NASD clearance for offering
of the Shares, and the payment of any NASD filing fee; and (iii) all fees and
expenses of the Company's transfer agent, printing of the certificates for the
Shares and all transfer taxes, if any, with respect to the sale and delivery of
the Shares to the several Underwriters.
The provisions of this Section shall not affect any agreement which the
Company and the Selling Stockholders may make for the allocation or sharing of
such expenses and costs.
SECTION 8. Conditions of the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Firm Shares
on the First Closing Date and the Option Shares on the Second Closing Date shall
be subject to the accuracy of the representations and warranties on the part of
the Company and the Selling Stockholders herein set forth as of the date hereof
and as of the First Closing Date or the Second Closing Date, as the case may be,
to the accuracy of the statements contained in the certificate of the Company
delivered pursuant to the provisions hereof, to the performance by the Company
and the Selling Stockholders of their respective obligations hereunder, and to
the following additional conditions:
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(a) The Registration Statement shall have become effective either
prior to the execution of this Agreement or not later than 1:00 P.M.,
Chicago Time, on the first full business day after the date of this
Agreement, or such later time as shall have been consented to by you but
in no event later than 1:00 P.M., Chicago Time, on the third full business
day following the date hereof; and prior to the First Closing Date or the
Second Closing Date, as the case may be, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or shall be
pending or, to the knowledge of the Company, the Selling Stockholders or
you, shall be contemplated by the Commission. If the Company has elected
to rely upon Rule 430A and/or Rule 434, the information concerning the
initial public offering price of the Shares and price-related information
shall have been transmitted to the Commission for filing pursuant to Rule
424(b) within the prescribed period and the Company will provide evidence
satisfactory to the Underwriters of such timely filing (or a
post-effective amendment providing such information shall have been filed
and declared effective in accordance with the requirements of Rules 430A
and 424(b)). If a Rule 462(b) Registration Statement is required, such
Registration Statement shall have been transmitted to the Commission for
filing and become effective within the prescribed time period and, prior
to the First Closing Date, the Company shall have provided evidence of
such filing and effectiveness in accordance with Rule 462(b).
(b) The Shares shall have been qualified for sale under the blue sky
laws of such states as shall have been specified by the Underwriters.
(c) The legality and sufficiency of the authorization, issuance and
sale or transfer and sale of the Shares hereunder, the validity and form
of the certificates representing the Shares, the execution and delivery of
this Agreement and the Pricing Agreement, and all corporate proceedings
and other legal matters incident thereto, and the form of the Registration
Statement and the Prospectus (except financial statements) shall have been
approved by counsel for the Underwriters exercising reasonable judgment.
(d) You shall not have advised the Company that the Registration
Statement or the Prospectus or any amendment or supplement thereto,
contains an untrue statement of fact, which, in the reasonable opinion of
counsel for the Underwriters, is material or omits to state a fact which,
in the opinion of such counsel, is material and is required to be stated
therein or necessary in order to make the statements therein not
misleading.
(e) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred any material adverse change, or any material
adverse development involving a prospective material adverse change, in or
affecting particularly the business or properties of the Company or its
subsidiaries, taken as a whole, whether or not arising in the ordinary
course of business, which, in the reasonable judgment of the Underwriters,
makes it impractical or inadvisable to proceed with the public offering or
purchase of the Shares as contemplated hereby.
(f) There shall have been furnished to the Underwriters, on the
First Closing Date or the Second Closing Date, as the case may be, except
as otherwise expressly provided below:
(i) An opinion of Xxxxxx & Xxxxxxx, counsel for the Company,
addressed to the Underwriters and dated the First Closing Date or
the Second Closing Date, as the case may be, to the effect that:
(1) the Company has been duly incorporated and is
validly existing and in good standing under the laws of the
State of Delaware with corporate power and
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authority to own its properties and conduct its business as
described in the Registration Statement and Prospectus; and,
based solely on certificates from public officials, counsel
shall confirm that the Company is qualified to do business in
each state set forth in Schedule I to such opinion;
(2) an opinion to the same general effect as clause (1)
of this subparagraph (i) in respect of RSC Holdings Inc., RSC
Acquisition Corp., Acme Xxxxx Inc., Acme Xxxxx Inc. and Acme
Rents, Inc., the direct and indirect Delaware and California
subsidiaries of the Company (collectively, the "Identified
Subsidiaries" and each an "Identified Subsidiary");
(3) the issued and outstanding shares of capital stock
of each Identified Subsidiary are as set forth in Schedule II
to such opinion (the "Subsidiary Shares"). The Subsidiary
Shares have been duly authorized, validly issued and are fully
paid and nonassessable. Except as disclosed in the
Registration Statement (including contracts filed as exhibits
to the Registration Statement), the Company owns of record
directly or indirectly all of the Subsidiary Shares and all of
the outstanding shares of capital stock of each of Acme
Alabama, Inc., The Air & Pump Company, Inc. and Xxxxxx Xxxxx
Equipment, Inc. (collectively with the Identified
Subsidiaries, the "Subsidiaries"), and to the knowledge of
such counsel, owns such stock of the Subsidiaries free and
clear of any adverse claim (as defined in Section 8-302 of the
Uniform Commercial Code);
(4) the authorized capital stock of the Company consists
of 20,000,000 shares of Common Stock and 500,000 shares of
preferred stock, par value $0.01 per share, of which, based
solely upon a review of a certificate of the transfer agent
and registrar of the Company and upon issuance, delivery and
payment by you and the other Underwriters for shares of Common
Stock to be issued pursuant to and in accordance with the
terms of the Underwriting Agreement and the Pricing Agreement,
11,571,777 shares of Common Stock are outstanding as of the
date hereof (the "Capital Stock"); and such Capital Stock
conforms as to legal matters in all material respects to the
description thereof in the Prospectus under the caption
"Description of Capital Stock";
(5) the Capital Stock (including the Shares), upon
issuance, delivery and payment by you and the other
Underwriters for the Shares to be issued pursuant to and in
accordance with the terms of the Underwriting Agreement and
the Pricing Agreement, has been duly authorized and validly
issued and is fully paid and nonassessable;
(6) the form of certificates for the Shares to be
delivered hereunder are in due and proper form under the
Delaware General Corporation Law (the "DGCL");
(7) the Registration Statement has become effective
under the 1933 Act and, to the knowledge of such counsel, no
stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act and no
proceedings therefor have been initiated by the Commission.
(8) the Registration Statement and the Prospectus comply
as to form in all material respects with the requirements for
registration statements on Form S-1 under
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the 1933 Act; it being understood, however, that such counsel
need express no opinion with respect to the financial
statements, the notes thereto, and the related schedules and
other financial, numerical, statistical or accounting data
included in the Registration Statement or the Prospectus; and
to such counsel's knowledge there are no leases, contracts or
documents of a character required to be described in the
Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not described
or filed, as required. In passing upon the compliance as to
form of the Registration Statement and the Prospectus, such
counsel may assume that the statements made therein are
correct and complete;
(9) the statements under the captions "Management -
Equity Participation Plans and - Employee Qualified Stock
Purchase Plan," "Certain Relationships and Related
Transactions," "Description of Capital Stock" and "Shares
Eligible for Future Sale" in the Prospectus, insofar as such
statements constitute a summary of the terms of the Company's
capital stock, legal matters or documents referred to therein,
are accurate in all material respects;
(10) this Agreement and the Pricing Agreement have been
duly authorized, executed and delivered by the Company; and to
such counsel's knowledge, no consent, approval, authorization
or order of, or filing with, any federal or Illinois or
Delaware court or governmental agency or body is required for
the consummation of the issuance and sale of the Shares by the
Company pursuant to this Agreement and the Pricing Agreement,
except such as have been obtained under the federal securities
laws and such as may be required under state securities laws
in connection with the purchase and distribution of such
Shares by the Underwriters; and
(11) the execution of this Agreement and the issuance of
the Shares by the Company pursuant to this Agreement will not
result in a breach of or a default under, any agreement,
franchise, license, indenture, mortgage, deed of trust, or
other instrument of the Company or any of its subsidiaries or
by which the property of any of them is bound which is filed
as an exhibit to the Registration Statement; or violate any of
the provisions of the Company's Amended and Restated
Certificate of Incorporation or Bylaws or the DGCL or any
federal or Illinois statute, rule or regulation known to such
counsel to be applicable to the Company (other than federal
securities laws).
In rendering such opinion, such counsel may state that they are
relying upon the certificate of the transfer agent for the Common Stock,
as to the number of shares of Common Stock at any time or times
outstanding. Such counsel may also rely upon the opinions of other
competent counsel and, as to factual matters, on certificates of the
Selling Stockholders and of officers of the Company and of state
officials, in which case their opinion is to state that they are so doing
and copies of said opinions or certificates are to be attached to the
opinion unless said opinions or certificates (or, in the case of
certificates, the information therein) have been furnished to the
Underwriters in other form.
In addition, such counsel shall state that it has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants for the Company, and
representatives of the Underwriters at which the contents of the Registration
Statement and the Prospectus and related matters were discussed and, although
such counsel need not pass upon, and need
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not assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus (other
than as expressly set forth above in paragraphs 4 and 9) and need not make any
independent check or verification thereof, during the course of such
participation (relying as to materiality to a large extent upon the statements
of officers and other representatives of the Company), no facts have come to
such counsel's attention that causes such counsel to believe either the
Registration Statement (including the information deemed to be part of the
Registration Statement at the time of effectiveness pursuant to Rule 430A(b)
and/or Rule 434, if applicable) at the time it became effective 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
or that the Prospectus, as amended or supplemented, if applicable, as of its
date and as of the First Closing Date or the Second Closing Date, as the case
may be, contained any untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, it being understood
that such counsel need not express any belief with respect to the financial
statements, the notes thereto and the related schedules and other financial,
numerical, statistical or accounting data included in the Registration Statement
or Prospectus.
(ii) an opinion of counsel for each of the Selling Stockholders addressed
to the Underwriters and dated the First Closing Date or the Second Closing Date,
to the effect that;
(1) this Agreement and the Pricing Agreement, if such
Selling Stockholder is not an individual, have been duly
authorized, executed and delivered by or on behalf of each
such Selling Stockholder, if such Selling Stockholder is not
an individual, the Agents and the Custodian for each such
Selling Stockholder have been duly and validly authorized to
carry out all transactions contemplated herein on behalf of
each such Selling Stockholder; and the performance of this
Agreement and the Pricing Agreement and the consummation of
the transactions herein contemplated by such Selling
Stockholders will not result in a breach or violation of any
of the terms and provisions of, or constitute a default under,
any statute, any indenture, mortgage, deed of trust, note
agreement or other agreement or instrument known to such
counsel to which any of such Selling Stockholders is a party
or by which any are bound or to which any of the property of
such Selling Stockholders is subject, or any order, rule or
regulation known to such counsel of any court or governmental
agency or body having jurisdiction over any of such Selling
Stockholders or any of their properties; and no consent,
approval, authorization or order of any court or governmental
agency or body is required for the consummation of the
transactions contemplated by this Agreement and the Pricing
Agreement in connection with the sale of Shares to be sold by
such Selling Stockholders hereunder, except such as have been
obtained under the 1933 Act and such as may be required under
applicable blue sky laws in connection with the purchase and
distribution of such Shares by the Underwriters and the
clearance of such offering with the NASD;
(2) each Selling Stockholder has full right, power and
authority to enter into this Agreement and the Pricing
Agreement and to sell, transfer and deliver the Shares to be
sold on the First Closing Date or the Second Closing Date, as
the case may be, by such Selling Stockholder hereunder and
good and marketable title to such Shares so sold, free and
clear of all voting trust arrangements, liens, encumbrances,
equities, claims and community property rights whatsoever, has
been transferred to the Underwriters (who counsel may assume
to be bona fide purchasers) who have purchased such Shares
hereunder.
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In addition, although such counsel need not pass upon, and need not
assume any responsibility for, the accuracy, completeness or fairness of
the statements contained in the Registration Statement and the Prospectus
and need not make any independent check or verification thereof, during
the course of such participation (relying as to materiality to a large
extent upon the statements of officers and other representatives of the
Company), no facts have come to such counsel's attention that causes such
counsel to believe either the Registration Statement (including the
information deemed to be part of the Registration Statement at the time of
effectiveness pursuant to Rule 430A(b) and/or Rule 434, if applicable) at
the time it became effective, insofar as it relates to such Selling
Stockholder, 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 or that the Prospectus, as
amended or supplemented, if applicable, as of its date and as of the First
Closing Date or the Second Closing Date, as the case may be, insofar as it
relates to such Selling Stockholder, contained any untrue statement of a
material fact or omitted to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
(iii) Such opinion or opinions of Sidley & Austin, counsel for the
Underwriters, dated the First Closing Date or the Second Closing Date, as
the case may be, with respect to the incorporation of the Company, the
validity of the Shares to be sold by the Company, the Registration
Statement and the Prospectus and other related matters as you may
reasonably require, and the Company shall have furnished to such counsel
such documents and shall have exhibited to them such papers and records as
they request for the purpose of enabling them to pass upon such matters.
(iv) A certificate of the Company executed on its behalf by the
chief executive officer and the principal financial officer of the
Company, dated the First Closing Date or the Second Closing Date, as the
case may be, to the effect that:
(1) the representations and warranties of the Company set
forth in Section 2 of this Agreement are true and correct as of the
date of this Agreement and as of the First Closing Date or the
Second Closing Date, as the case may be, and the Company has
complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to such date; and
(2) to the best knowledge of the respective signers, the
Commission has not issued an order preventing or suspending the use
of the Prospectus or any preliminary prospectus filed as a part of
the Registration Statement or any amendment thereto; no stop order
suspending the effectiveness of the Registration Statement has been
issued; and no proceedings for that purpose have been instituted or
are pending or contemplated under the 1933 Act.
The delivery of the certificate provided for in this subparagraph shall be
and constitute a representation and warranty of the Company as to the facts
required in the immediately foregoing clauses (1) and (2) of this subparagraph
to be set forth in said certificate.
(v) A certificate of each Selling Stockholder dated the First
Closing Date or the Second Closing Date, as the case may be, to the effect
that the representations and warranties of such Selling Stockholder set
forth in Section 3 of this Agreement are true and correct as of such date
and such Selling Stockholder has complied with all the agreements and
satisfied all the conditions on the part of such Selling Stockholder to be
performed or satisfied at or prior to such date.
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(vi) At the time the Pricing Agreement is executed and also on the
First Closing Date or the Second Closing Date, as the case may be, there
shall be delivered to you a letter addressed to you, as Underwriters, from
Ernst & Young LLP, independent accountants, the first one to be dated the
date of the Pricing Agreement, the second one to be dated the First
Closing Date and the third one (in the event of a second closing) to be
dated the Second Closing Date, to the effect set forth in Schedule C.
There shall not have been any material adverse change specified in the
letters referred to in this subparagraph which makes it impractical or
inadvisable in the reasonable judgment of the Underwriters to proceed with
the public offering or purchase of the Shares as contemplated hereby.
(vii) Such further certificates and documents as you may reasonably
request.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are reasonably satisfactory
to you and to Sidley & Austin, counsel for the Underwriters, which approval
shall not be unreasonably withheld. The Company shall furnish you with such
manually signed or conformed copies of such opinions, certificates, letters and
documents as you shall reasonably request.
If any condition to the Underwriters' obligations hereunder to be
satisfied prior to or at the First Closing Date is not so satisfied, this
Agreement at your election will terminate upon notification to the Company and
the Selling Stockholders without liability on the part of any Underwriter or the
Company or any Selling Stockholder, except for the expenses to be paid or
reimbursed by the Company pursuant to Sections 7 and 9 hereof and except to the
extent provided in Section 11 hereof.
SECTION 9. Reimbursement of Underwriters' Expenses. If the sale to the
Underwriters of the Shares on the First Closing Date is not consummated because
any condition of the Underwriters' obligations hereunder is not satisfied or
because of any refusal, inability or failure on the part of the Company or the
Selling Stockholders to perform any agreement herein or to comply with any
provision hereof, unless such failure to satisfy such condition or to comply
with any provision hereof is due to the default or omission of any Underwriter,
the Company agrees to reimburse you and the other Underwriters upon demand for
all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been reasonably incurred by you and them in connection
with the proposed purchase and the sale of the Shares. Any such termination
shall be without liability of any party to any other party except that the
provisions of this Section, Section 7 and Section 11 shall at all times be
effective and shall apply.
SECTION 10. Effectiveness of Registration Statement. You, the Company and
the Selling Stockholders will use your, its and their best efforts to cause the
Registration Statement to become effective, if it has not yet become effective,
and to prevent the issuance of any stop order suspending the effectiveness of
the Registration Statement and, if such stop order be issued, to obtain as soon
as possible the lifting thereof.
SECTION 11. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of the 1933 Act or the Exchange Act against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter or
such controlling person may become subject under the 1933 Act, the Exchange Act
or other federal or state statutory law or regulation, at common law or
otherwise (including in settlement of any litigation if such settlement is
effected with the written consent of the Company), insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, any preliminary prospectus, the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading;
and will reimburse
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each Underwriter and each such controlling person for any legal or other
expenses reasonably incurred by such Underwriter or such controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that (i) any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in the Registration Statement, any
preliminary prospectus, the Prospectus or any amendment or supplement thereto in
reliance upon and in conformity with the written information furnished to the
Company by or on behalf of any Underwriter, specifically for use therein; or
(ii) if such statement or omission was contained or made in any preliminary
prospectus and corrected in the Prospectus and (1) any such loss, claim, damage
or liability suffered or incurred by any Underwriter (or any person who controls
any Underwriter) resulted from an action, claim or suit by any person who
purchased Shares which are the subject thereof from such Underwriter in the
offering and (2) such Underwriter failed to deliver or provide a copy of the
Prospectus to such person at or prior to the confirmation of the sale of such
Shares in any case where such delivery is required by the 1933 Act. In addition
to its other obligations under this Section 11(a), the Company agrees that, as
an interim measure during the pendency of any claim, action, investigation,
inquiry or other proceeding arising out of or based upon any statement or
omission, or any alleged statement or omission, described in this Section 11(a),
it will reimburse the Underwriters on a monthly basis for all reasonable legal
and other expenses of one counsel incurred in connection with investigating or
defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the Company's obligation to reimburse the Underwriters for
such expenses and the possibility that such payments might later be held to have
been improper by a court of competent jurisdiction. This indemnity agreement
will be in addition to any liability which the Company may otherwise have.
Each Selling Stockholder severally and not jointly, agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of the 1933 Act or the Exchange Act against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter or such controlling person may become subject under the 1933 Act,
the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise (including in settlement of any litigation if such
settlement is effected with the written consent of the Company), to the same
extent as the foregoing indemnity to each Underwriter set forth in the
immediately preceding paragraph, but only with reference to information provided
in writing by such Selling Stockholder to the Company specifically for use in
the preparation of the documents referred to in the preceding paragraph.
Without limiting the full extent of the Company's agreement to indemnify
each Underwriter, as herein provided, each Selling Stockholder shall be liable
under the indemnity agreements contained in this Section 11(a) only for an
amount not exceeding the proceeds received by such Selling Stockholder from the
sale of Shares hereunder.
(b) Each Underwriter will severally indemnify and hold harmless the
Company, each of its directors, each of its officers who signed the Registration
Statement, and each Selling Stockholder and each person, if any, who controls
the Company within the meaning of the 1933 Act or the Exchange Act, against any
losses, claims, damages or liabilities to which the Company, or any such
director, officer, Selling Stockholder or controlling person may become subject
under the 1933 Act, the Exchange Act or other federal or state statutory law or
regulation, at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Underwriter), insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue or alleged untrue
statement of any material fact contained in the Registration Statement, any
preliminary prospectus, the Prospectus, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the
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Registration Statement, any preliminary prospectus, the Prospectus, or any
amendment or supplement thereto in reliance upon and in conformity with Section
4 of this Agreement and will reimburse any legal or other expenses reasonably
incurred by the Company, or any such director, officer, Selling Stockholder or
controlling person in connection with investigating or defending any such loss,
claim, damage, liability or action. In addition to their other obligations under
this Section 11(b), the Underwriters agree that, as an interim measure during
the pendency of any claim, action, investigation, inquiry or other proceeding
arising out of or based upon any statement or omission, or any alleged statement
or omission, described in this Section 11(b), they will reimburse the Company
and the Selling Stockholders on a monthly basis for all reasonable legal and
other expenses incurred in connection with investigating or defending any such
claim, action, investigation, inquiry or other proceeding, notwithstanding the
absence of a judicial determination as to the propriety and enforceability of
the Underwriters' obligation to reimburse the Company and the Selling
Stockholders for such expenses and the possibility that such payments might
later be held to have been improper by a court of competent jurisdiction. This
indemnity agreement will be in addition to any liability which the Underwriters
may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party under this
Section, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party except to the extent that
the indemnifying party was prejudiced by such failure to notify. In case any
such action is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate in, and, to the extent that it may wish, jointly with
all other indemnifying parties similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided, however,
if the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, or the indemnified and indemnifying parties may have
conflicting interests which would make it inappropriate for the same counsel to
represent both of them, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defense and otherwise to
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed such counsel in
connection with the assumption of legal defense in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
counsel, approved by the Underwriters in the case of paragraph (a) representing
all Underwriters and related persons that are indemnified parties, (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized in writing the employment of counsel for the indemnified party at the
expense of the indemnifying party. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability arising out of such proceeding.
(d) If the indemnification provided for in this Section is unavailable to
an indemnified party under paragraphs (a) or (b) hereof in respect of any
losses, claims, damages or liabilities referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, the
Selling Stockholders and the
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21
Underwriters from the offering of the Shares or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company, the Selling Stockholders and
the Underwriters in connection with the statements or omissions which resulted
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The respective relative benefits received by the
Company, the Selling Stockholders and the Underwriters shall be deemed to be in
the same proportion in the case of the Company and the Selling Stockholders, as
the total price paid to the Company and the Selling Stockholders for the Shares
by the Underwriters (net of underwriting discount but before deducting
expenses), and in the case of the Underwriters as the underwriting discount
received by them bears to the total of such amounts paid to the Company and the
Selling Stockholders and received by the Underwriters as underwriting discount
in each case as contemplated by the Prospectus. The relative fault of the
Company and the Selling Stockholders and the Underwriters shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission to state a material fact relates to
information supplied by the Company or by the Selling Stockholders or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, claims, damages and
liabilities referred to above shall be deemed to include any legal or other fees
or expenses reasonably incurred by such party in connection with investigating
or defending any action or claim.
The Company, the Selling Stockholders and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section,
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 0000 Xxx) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Underwriters' obligations
to contribute pursuant to this Section are several in proportion to their
respective underwriting commitments and not joint.
(e) The provisions of this Section shall survive any termination of this
Agreement.
Section 12. Default of Underwriters. It shall be a condition to the
agreement and obligation of the Company and the Selling Stockholders to sell and
deliver the Shares hereunder, and of each Underwriter to purchase the Shares
hereunder, that, except as hereinafter in this paragraph provided, each of the
Underwriters shall purchase and pay for all Shares agreed to be purchased by
such Underwriter hereunder upon tender to the Underwriters of all such Shares in
accordance with the terms hereof. If any Underwriter or Underwriters default in
their obligations to purchase Shares hereunder on the First Closing Date and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed 10 percent of the total number of
Shares which the Underwriters are obligated to purchase on the First Closing
Date, the Underwriters may make arrangements satisfactory to the Company and the
Selling Stockholders for the purchase of such Shares by other persons, including
any of the Underwriters, but if no such arrangements are made by such date the
nondefaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Shares which such defaulting
Underwriters agreed but failed to purchase on such date. If any Underwriter or
Underwriters so default and the aggregate number of Shares with respect to which
such default or defaults occur is more than the above percentage and
arrangements satisfactory to the Underwriters and the Company and the Selling
Stockholders for the purchase of such Shares by other persons are not made
within 36 hours after such default, this Agreement will terminate without
liability on the part of any nondefaulting
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22
Underwriter or the Company or the Selling Stockholders, except for the expenses
to be paid by the Company pursuant to Section 7 hereof and except to the extent
provided in Section 11 hereof.
In the event that Shares to which a default relates are to be purchased by
the nondefaulting Underwriters or by another party or parties, the nondefaulting
Underwriters or the Company shall have the right to postpone the First Closing
Date for not more than seven business days in order that the necessary changes
in the Registration Statement, Prospectus and any other documents, as well as
any other arrangements, may be effected. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
SECTION 13. Effective Date. This Agreement shall become effective
immediately as to Sections 7, 9, 11 and 14 and as to all other provisions at
10:00 A.M., Chicago Time, on the day following the date upon which the Pricing
Agreement is executed and delivered, unless such a day is a Saturday, Sunday or
holiday (and in that event this Agreement shall become effective at such hour on
the business day next succeeding such Saturday, Sunday or holiday); but this
Agreement shall nevertheless become effective at such earlier time after the
Pricing Agreement is executed and delivered as you may determine on and by
notice to the Company and the Selling Stockholders or by release of any Shares
for sale to the public. For the purposes of this Section, the Shares shall be
deemed to have been so released upon the release for publication of any
newspaper advertisement relating to the Shares or upon the release by you of
telegrams (i) advising Underwriters that the Shares are released for public
offering, or (ii) offering the Shares for sale to securities dealers, whichever
may occur first.
SECTION 14. Termination. Without limiting the right to terminate this
Agreement pursuant to any other provision hereof:
(a) This Agreement may be terminated by the Company by notice to you
and the Selling Stockholders or by you by notice to the Company and the
Selling Stockholders at any time prior to the time this Agreement shall
become effective as to all its provisions, and any such termination shall
be without liability on the part of the Company, or the Selling
Stockholders to any Underwriter (except for the expenses to be paid or
reimbursed pursuant to Section 7 hereof and except to the extent provided
in Section 11 hereof) or of any Underwriter to the Company, or the Selling
Stockholders.
(b) This Agreement may also be terminated by you prior to the First
Closing Date, and the option referred to in Section 5, if exercised, may
be canceled at any time prior to the Second Closing Date, if (i) trading
in securities on the New York Stock Exchange shall have been suspended or
minimum prices shall have been established on such exchange, or (ii) a
banking moratorium shall have been declared by Illinois, New York, or
United States authorities, or (iii) there shall have been any change in
financial markets or in political, economic or financial conditions which,
in the opinion of the Underwriters, materially and adversely affects the
market for the Shares, or (iv) there shall have been an outbreak of major
armed hostilities between the United States and any foreign power which in
the reasonable opinion of the Underwriters makes it impractical or
inadvisable to offer or sell the Shares. Any termination pursuant to this
paragraph (b) shall be without liability on the part of any Underwriter to
the Company or the Selling Stockholders or on the part of the Company to
any Underwriter or the Selling Stockholders (except for expenses to be
paid or reimbursed pursuant to Section 7 hereof and except to the extent
provided in Section 11 hereof).
SECTION 15. Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of the Selling Stockholders and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect,
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23
regardless of any investigation made by or on behalf of any Underwriter or the
Company or any of its or their partners, principals, members, officers or
directors or any controlling person, or the Selling Stockholders, as the case
may be, and will survive delivery of and payment for the Shares sold hereunder.
SECTION 16. Notices. All communications hereunder will be in writing and,
if sent to the Underwriters will be mailed, delivered or telegraphed and
confirmed to you c/o Xxxxxxx Xxxxx & Company, L.L.C., 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000, with a copy to Sidley & Austin, One First National
Plaza, Chicago, Illinois, Attention: Xxxxx Xxxxxx, Esq.; if sent to the Company
will be mailed, delivered or telegraphed and confirmed to the Company at its
corporate headquarters with a copy to Xxxxxx & Xxxxxxx, 000 Xxxx Xxxxx Xxxxxx,
Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxxxxx X. Xxxxxxxx,
Esq.; and if sent to the Selling Stockholders will be mailed, delivered or
telegraphed and confirmed to the Agents and the Custodian at such address as
they have previously furnished to the Company and the Underwriters, with a copy
to Xxxxxx & Xxxxxxx, 000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx
00000, Attention: Xxxxxxxxx X. Xxxxxxxx, Esq.
SECTION 17. Successors. This Agreement and the Pricing Agreement will
inure to the benefit of and be binding upon the parties hereto and their
respective successors, personal representatives and assigns, and to the benefit
of the officers and directors and controlling persons referred to in Section 11,
and no other person will have any right or obligation hereunder. The term
"successors" shall not include any purchaser of the Shares as such from any of
the Underwriters merely by reason of such purchase.
SECTION 18. Partial Unenforceability. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
SECTION 19. Counterparts. This Agreement may be executed in one or more
counterparts, and all counterparts so executed shall constitute one agreement.
SECTION 20. Applicable Law. This Agreement and the Pricing Agreement shall
be governed by and construed in accordance with the laws of the State of
Illinois.
* * * * * * * *
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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement among the Company, the Selling Stockholders and the
several Underwriters, all in accordance with its terms.
Very truly yours,
RENTAL SERVICE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Senior Vice President
BRENTWOOD RSC PARTNERS, L.P.
By: Brentwood Buyout Partners, L.P.,
its general partner
/s/ Xxxxxxx X. Xxxxxx, Xx.
--------------------------------------
By: Xxxxxxx X. Xxxxxx, Xx.
NASSAU CAPITAL PARTNERS L.P.
By: Nausau Capital L.L.C.,
its general partner
/s/ Xxxx X. Xxxxxxx
--------------------------------------
By: Xxxx X. Xxxxxxx
NAS PARTNERS I L.L.C.
/s/ Xxxx X. Xxxxxxx
--------------------------------------
By: Xxxx X. Xxxxxxx
UST PRIVATE EQUITY INVESTORS FUND INC.
/s/ Xxxxx X. Xxxx
--------------------------------------
By: Xxxxx X. Xxxx
-00-
00
XXXXXX XXXXXXX
/s/ Xxxxxx Xxxxxxx
--------------------------------------
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx Lufkin & Xxxxxxxx Securities Corporation
By: Xxxxxxx Xxxxx & Company, L.L.C.
By: /s/ Xxxxx Xxxxxxxxx
----------------------------
Principal
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26
SCHEDULE A
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
Xxxxxxx Xxxxx & Company, L.L.C. ................................ 2,112,000
Xxxxxx Xxxxxxx & Co. Incorporated .............................. 2,112,000
Xxxxxxxxx Lufkin & Xxxxxxxx Securities Corporation ............. 1,056,000
---------
Total 5,280,000
=========
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27
SCHEDULE B
Number of Number of
Firm Shares Option Shares
to be Sold to be Sold
---------- ----------
Company 3,000,000 0
Brentwood RSC Partners, L.P. 1,851,158 644,612
Nassau Capital Partners L.P. 350,825 122,164
NAS Partners I L.L.C 1,897 661
UST Private Equity Investors Fund Inc. 70,540 24,563
Xxxxxx Xxxxxxx 5,580 0
Total 5,280,000 792,000
========= =========
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28
SCHEDULE C
Comfort Letter of Ernst & Young LLP
(1) They are independent public accountants with respect to the Company
and its subsidiaries within the meaning of the 1933 Act.
(2) In their opinion the consolidated financial statements and schedules
of the Company and its subsidiaries included in the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act.
(3) On the basis of specified procedures (but not an examination in
accordance with generally accepted auditing standards), including inquiries of
certain officers of the Company and its subsidiaries responsible for financial
and accounting matters as to transactions and events subsequent to December 31,
1996, a reading of minutes of meetings of the stockholders and directors of the
Company and its subsidiaries since December 31, 1996, a reading of the latest
available interim unaudited consolidated financial statements of the Company and
its subsidiaries (with an indication of the date thereof) and other procedures
as specified in such letter, nothing came to their attention which caused them
to believe that (i) the unaudited consolidated financial statements of the
Company and its subsidiaries included in the Registration Statement do not
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act or that such unaudited financial statements are not
fairly presented in accordance with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited financial
statements included in the Registration Statement, (ii) the unaudited pro forma
financial statements included in the Registration Statement do not comply in
form in all material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X and the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of such statements
and (iii) at a specified date not more than five days prior to the date thereof
in the case of the first letter and not more than two business days prior to the
date thereof in the case of the second and third letters, there was any change
in the capital stock or long-term debt or short-term debt (other than normal
payments) of the Company and its subsidiaries on a consolidated basis or any
decrease in consolidated total assets or consolidated stockholders' equity as
compared with amounts shown on the latest unaudited balance sheet of the Company
included in the Registration Statement or for the period from the date of such
balance sheet to a date not more than five days prior to the date thereof in the
case of the first letter and not more than two business days prior to the date
thereof in the case of the second and third letters, there were any decreases,
as compared with the corresponding period of the prior year, in equipment
rentals or sales of parts, supplies and equipment, consolidated operating income
or in the total or per share amounts of consolidated net income except, in all
instances, for changes or decreases which the Prospectus discloses have occurred
or may occur or which are set forth in such letter.
(4) They have carried out specified procedures, which have been agreed to
by the Underwriters, with respect to certain information in the Prospectus
specified by the Underwriters, and on the basis of such procedures, they have
found such information to be in agreement with the general accounting records of
the Company and its subsidiaries.
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29
EXHIBIT A
RENTAL SERVICE CORPORATION
5,280,000 Shares Common Stock(2)
PRICING AGREEMENT
May 29, 1997
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx Lufkin & Xxxxxxxx Securities Corporation
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement dated May 29, 1997 (the
"Underwriting Agreement") relating to the sale by the Company and the Selling
Stockholders and the purchase by Xxxxxxx Xxxxx & Company, L.L.C., Xxxxxx Xxxxxxx
& Co. Incorporated and Xxxxxxxxx Lufkin & Xxxxxxxx Securities Corporation, as
Underwriters, of the above Shares. All terms herein shall have the definitions
contained in the Underwriting Agreement except as otherwise defined herein.
Pursuant to Section 5 of the Underwriting Agreement, the Company and each
of the Selling Stockholders agree with the Underwriters as follows:
1. The public offering price per share for the Shares shall be $19.875.
2. The purchase price per share for the Shares to be paid by the several
Underwriters shall be $18.881, being an amount equal to the initial public
offering price set forth above less $0.994 per share.
----------
(2) Plus an option to acquire up to 792,000 additional shares to cover over
allotments
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30
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholders and the several Underwriters, all in accordance with its terms.
Very truly yours,
RENTAL SERVICE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Senior Vice President
BRENTWOOD RSC PARTNERS, L.P.
By: Brentwood Buyout Partners, L.P.,
its general partner
/s/ Xxxxxxx X. Xxxxxx, Xx.
--------------------------------------
By: Xxxxxxx X. Xxxxxx, Xx.
NASSAU CAPITAL PARTNERS L.P.
By: Nausau Capital L.L.C.,
its general partner
/s/ Xxxx X. Xxxxxxx
--------------------------------------
By: Xxxx X. Xxxxxxx
NAS PARTNERS I L.L.C.
/s/ Xxxx X. Xxxxxxx
--------------------------------------
By: Xxxx X. Xxxxxxx
UST PRIVATE EQUITY INVESTORS FUND INC.
/s/ Xxxxx X. Xxxx
--------------------------------------
By: Xxxxx X. Xxxx
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00
XXXXXX XXXXXXX
/s/ Xxxxxx Xxxxxxx
--------------------------------------
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxxxx Lufkin & Xxxxxxxx Securities Corporation
By Xxxxxxx Xxxxx & Company, L.L.C.
By: /s/ Xxxxx Xxxxxxxxx
--------------------------------------
Principal
-31-
