1
Exhibit 1
INTERNATIONAL TOTAL SERVICES, INC.
2,825,000 Common Shares*
UNDERWRITING AGREEMENT
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September 18, 1997
▇▇▇▇▇▇▇▇ & Company Securities, Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc.
As Representatives of the Several Underwriters
c/▇ ▇▇▇▇▇▇▇▇ & Company Securities, Inc.
▇▇▇▇▇▇▇▇ Investment Center
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
1. INTRODUCTORY. International Total Services, Inc., an Ohio
corporation (the "Company"), proposes to issue and sell 2,597,727 of its common
shares, without par value (the "Common Shares"), which are authorized but
unissued, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "Selling Shareholder") proposes to sell
227,273 outstanding Common Shares, to the public through the underwriters named
in Schedule A annexed hereto (the "Underwriters") for whom you are acting as the
Representatives. The 2,825,000 Common Shares to be purchased from the Company
and Selling Shareholder are hereinafter referred to as the "Firm Stock." The
Company also proposes to sell to the Underwriters, at their option, an aggregate
of not more than 423,750 additional Common Shares solely to cover
over-allotments, which are hereinafter referred to as the "Option Stock." The
Firm Stock and the Option Stock are hereinafter collectively referred to as the
"Stock" and are more fully described in the Registration Statement and the
Prospectus (as hereinafter defined). The Company and the Selling Shareholder
hereby confirm its and his several agreements, as set forth herein, with you,
acting as the Representatives of the Underwriters.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each of the Underwriters that:
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* Plus an option to purchase up to 423,750 additional shares to cover
over-allotments.
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(a) The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than those
listed in Exhibit 21 to the Registration Statement (as hereinafter defined).
The Company has been duly organized and is validly existing as a corporation in
good standing under the laws of Ohio with corporate power and authority to own
and lease its properties and conduct its business as described in the
Prospectus (as hereinafter defined). Each of the Company's subsidiaries has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of its respective jurisdiction of incorporation, with
corporate power and authority to own and lease its properties and conduct its
respective business. The Company and each of its subsidiaries is duly qualified
to do business as a foreign corporation and is in good standing in all
jurisdictions (i) in which the conduct of business, as presently being
conducted, requires such qualification and (ii) in which the Company or such
subsidiary owns or leases real property (except for those jurisdictions in
which the failure to so qualify will not in the aggregate have a material
adverse effect on the Company and such subsidiaries, taken as a whole). Except
as disclosed in the Registration Statement and except for the shares of stock
of each subsidiary owned by the Company, neither the Company nor any subsidiary
owns, directly or indirectly, any equity securities or securities convertible
into or exchangeable for equity securities of any other corporation,
partnership, joint venture, Massachusetts or other business trust or any other
business enterprise.
(b) This Agreement has been duly and validly authorized,
executed and delivered on
behalf of the Company.
(c) The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission"), in conformity with the requirements of
the Securities Act of 1933, as amended (the "Act"), and the Rules and
Regulations of the Commission thereunder (as hereinafter defined), a
registration statement on Form S-1 (Registration No. 333-29463) including a
preliminary prospectus relating to the Company's Stock, and such amendments to
such registration statement as may have been required prior to the date hereof
have been similarly prepared and filed with the Commission. The registration
statement as amended at the time when it becomes effective, or, if applicable,
as amended at the time the most recent post-effective amendment to such
registration statement filed with the Commission prior to the execution and
delivery of this Agreement became effective (the "Effective Date"), and
including information (if any) contained in a prospectus subsequently filed
with the Commission pursuant to Rule 424(b) under the Act, and deemed to be
part of the registration statement at the time of effectiveness pursuant to
Rule 430A under the Act is hereinafter referred to as the "Registration
Statement"; the prospectus in the form first used to confirm sales of Stock,
whether or not filed with the Commission pursuant to Rule 424(b) under the Act
is hereinafter referred to as the "Prospectus." If an abbreviated registration
statement is prepared and filed with the Commission in accordance with Rule
462(b) under the Act (an "Abbreviated Registration Statement"), the term
"Registration Statement" as used in this Agreement includes the Abbreviated
Registration Statement.
(d) As of the Effective Date, and at all times subsequent
thereto up to and including the respective Closing Dates (as hereinafter
defined) of the offering, the Registration Statement and the Prospectus, and
any amendments thereof or supplements thereto,
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will contain all statements of material facts which are required to be stated
therein in accordance with the Act and the applicable rules, regulations and
interpretive releases of the Commission thereunder (the "Rules and
Regulations"), and will in all material respects conform to the requirements of
the Act and the Rules and Regulations; and neither the Registration Statement
nor the Prospectus, nor any amendment thereof or supplement thereto, will
include any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading; provided, however, that the Company makes no representations,
warranties or agreements as to information contained in the Registration
Statement or the Prospectus or any such amendment or supplement thereto in
reliance upon and in conformity with written information furnished to the
Company through you as the Representatives specifically for use in the
preparation thereof.
(e) The Company's duly authorized, issued and outstanding
capital stock is as set forth under "Capitalization" in the Prospectus; the
outstanding Common Shares are duly authorized and validly issued, fully paid
and nonassessable, are free of any preemptive rights, rights of first refusal
or similar rights, were issued and sold in compliance in all material respects
with the applicable Federal and state securities laws and conform in all
material respects to the description thereof in the Prospectus; except as
described in the Prospectus, there are no outstanding options, warrants or
other rights calling for the issuance of, and there are no commitments, plans
or arrangements to issue any shares of capital stock of the Company or any
security convertible or exchangeable or exercisable for capital stock of the
Company. There are no holders of securities of the Company who, by reason of
the filing of the Registration Statement have the right (and have not waived
such right) to request the Company to include in the Registration Statement
securities owned by them, other than such rights as have been satisfied by the
inclusion of securities in the Registration Statement.
(f) The Common Shares of the Company conform in substance to
all statements in relation thereto contained in the Registration Statement and
the Prospectus; the Stock to be sold by the Company hereunder has been duly
authorized and, when issued and delivered pursuant to this Agreement, will be
validly issued, fully paid and nonassessable and will conform to the
description thereof contained in the Prospectus; and the Stock to be sold by
the Selling Shareholder has been duly authorized and validly issued and is
fully paid and nonassessable. All corporate action required to be taken for the
issuance of the Stock by the Company has been validly taken. No preemptive
rights of security holders of the Company exist with respect to the issuance
and sale of the Stock by the Company pursuant hereto.
(g) All the issued shares of capital stock of each subsidiary
of the Company have been duly and validly authorized and issued, are fully paid
and nonassessable and are owned by the Company free and clear of all liens,
encumbrances, equities, security interests, or claims; and there are no
outstanding options, warrants or other rights calling for the issuance of, and
there are no commitments, plans or arrangements to issue, any shares of capital
stock of any subsidiary or any security convertible or exchangeable or
exercisable for capital stock of any subsidiary.
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(h) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus up to and including
the respective Closing Dates (as hereinafter defined), except as set forth or
contemplated in the Prospectus, (i) there has not been and will not have been
any change on a pro forma basis or otherwise in the capital stock or funded
debt of the Company and its subsidiaries which is material or any material
adverse change in the business or the financial position or results of
operations of the Company and its subsidiaries, taken as a whole, and (ii) no
loss or damage (whether or not insured) to the property of the Company and its
subsidiaries has been sustained which materially and adversely affects the
operations of the Company and its subsidiaries taken as a whole.
(i) The consummation of the transactions herein contemplated
and the fulfillment of the terms hereof will not conflict with or result in a
breach of any of the terms and provisions of, or constitute a default under,
the Articles of Incorporation or the Code of Regulations of the Company, or the
organizational documents of any of its subsidiaries, or any indenture,
mortgage, deed of trust or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound, or any order, rule or regulation applicable to the
Company or any of its subsidiaries of any court or of any federal or state
regulatory body or administrative agency or other governmental body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties.
(j) The financial statements of the Company and Intex Aviation
Services, Inc. ("Intex") included in the Registration Statement and the
Prospectus fairly present the financial position and results of operations of
the Company and Intex at the respective dates and for the respective periods to
which they apply, and such financial statements have been prepared in
conformity with generally accepted accounting principles consistently applied
throughout the periods involved. The pro forma financial statements of the
Company included in the Prospectus fairly present the pro forma financial
position and results of operations of the Company at the dates and for the
periods to which they apply, and have been prepared to give effect to certain
assumptions and proposed transactions made on reasonable bases which are fully
and accurately described in the Prospectus, and the pro forma adjustments have
been properly applied on the bases described therein.
(k) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have examined and expressed their
opinion on the financial statements of the Company and Intex referenced in
their opinions set forth in the Prospectus, are independent accountants within
the meaning of the Act and the Rules and Regulations.
(l) The Company and its subsidiaries hold all necessary
material authorizations, approvals, orders, licenses, certificates and permits
of and from all governmental regulatory officials and bodies (collectively the
"licenses") required for the conduct of its business as described in the
Prospectus, and all such licenses are valid and in full force and effect, and
the Company and its subsidiaries are operating in compliance in all material
respects with the terms and provisions of such licenses and with all material
laws, regulations, orders and decrees applicable to the Company and its
subsidiaries, and their respective businesses and assets.
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(m) Neither the Company nor any of its subsidiaries is in
violation of any applicable Federal, state or local laws, statutes, rules,
regulations or ordinances relating to public health, safety or the environment,
including, without limitation, relating to releases, discharges, emissions or
disposal to air, water, land or groundwater, to the withdrawal or use of
groundwater, to the use, handling or disposal of polychlorinated biphenyls
(PCBs), asbestos or urea formaldehyde, to the treatment, storage, disposal or
management of hazardous substances (including, without limitation, petroleum,
crude oil or any fraction thereof, or other hydrocarbons), pollutants or
contaminants, to exposure to toxic, hazardous or other controlled, prohibited
or regulated substances, which violation would have a material adverse effect
on the business, condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole, or which might materially and
adversely affect the consummation of the transactions contemplated by this
Agreement. In addition, and irrespective of such compliance, to the Company's
knowledge, neither the Company nor any of its subsidiaries is subject to any
liabilities for environmental remediation or clean-up, including any liability
or class of liability of the lessee under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, or the Resource
Conservation and Recovery Act of 1976, as amended, which liability would have a
material adverse effect on the business, condition (financial or other) or
results of operations of the Company and its subsidiaries, taken as a whole, or
which might materially and adversely affect the consummation of the
transactions contemplated by this Agreement.
(n) There are no legal or governmental actions, suits or
proceedings pending or, to the knowledge of the Company, threatened to which
the Company or any of its subsidiaries, or any of their executive officers or
directors is a party or of which the business or property (including, without
limitation, any of the licenses referred to in (l) above) of the Company or any
of its subsidiaries or any of the Company's or any of its subsidiaries'
employees is the subject which could have a material adverse effect on the
business, condition (financial or other) or results of operations of the
Company and its subsidiaries, except as set forth in the Prospectus.
(o) Neither the Company nor any of its subsidiaries is in
violation of its Articles of Incorporation or its Code of Regulations or other
organizational documents, and no material default exists by the Company or any
of its subsidiaries in the due performance and observance of any term, covenant
or condition of any agreement material to the Company and its subsidiaries to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound.
(p) The Company and its subsidiaries have good title to, or
valid and enforceable leasehold estates in, all properties and assets used for
their businesses (including the property described in the Prospectus as being
owned or leased by the Company), in each case free and clear of all liens,
encumbrances and defects other than those set forth or referred to in the
Registration Statement or Prospectus or those which do not materially affect
the value of such property or leasehold and do not materially interfere with
the use made or proposed to be made of such property or leasehold by the
Company and its subsidiaries; and all of the leases and
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subleases under which the Company and its subsidiaries hold such properties are
in full force and effect.
(q) Other than as set forth in the Prospectus, the Company and
its subsidiaries own or possess, or can acquire on reasonable terms, the
patents, patent rights, licenses, inventions, copyrights, know-how (including
trade secrets, applications and other unpatented or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks,
and trade names (collectively, "Proprietary Rights") used in or necessary for
the conduct of their businesses as now conducted and as proposed to be
conducted as described in the Prospectus; the Company and its subsidiaries have
the right to use all Proprietary Rights used in or necessary for the conduct of
their businesses without infringing the rights of any person or violating the
terms of any licensing or other agreement to which the Company or any of its
subsidiaries is a party, and to the knowledge of the Company no person is
infringing upon any Proprietary Right which the Company or any of its
subsidiaries has the sole and exclusive right to use; no charges, claims or
litigation have been asserted and remain pending or to the knowledge of the
Company have been threatened against the Company or any of its subsidiaries and
not withdrawn that contest the right of the Company or any of its subsidiaries
to use, or the validity of, any Proprietary Right or challenging or questioning
the validity or effectiveness of any license or agreement pertaining thereto or
asserting the misuse thereof, and, to the Company's knowledge, no valid basis
exists for the assertion of any such charge, claim or litigation; all licenses
and other agreements to which the Company or any of its subsidiaries is a party
relating to Proprietary Rights are in full force and effect and constitute
valid, binding and enforceable obligations of the Company or such subsidiary,
and, to the Company's knowledge, the other respective parties thereto, and, to
the Company's knowledge, there have not been and there currently are not any
defaults thereunder which would have a material adverse effect on the Company
and its subsidiaries, taken as a whole, and no event has occurred which
(whether by notice or lapse of time or both) would constitute such a default
under any license or other agreement affecting Proprietary Rights used in or
necessary for the conduct of the businesses of the Company and its subsidiaries
by any party; and except as set forth in the Prospectus, the validity,
continuation and effectiveness of all such licenses and other agreements and
the current terms thereof will not be affected by the transactions contemplated
by this Agreement.
(r) No approval, authorization, consent or other order of any
public board or body (other than in connection with or in compliance with the
provisions of the Act and the securities or Blue Sky laws of various
jurisdictions) is legally required for the sale of the Stock by the Company.
(s) The Common Shares have been registered under Section 12(g)
of the Securities Exchange Act of 1934, as amended, and have been authorized
for trading over-the-counter on the National Association of Securities Dealers
Automated Quotation National Market ("NASDAQ/NM") subject to notice of issuance
or sale, as the case may be.
(t) The outstanding debt, the properties and the business of
the Company and its subsidiaries conform in all material respects to the
description thereof contained in the Registration Statement and the Prospectus.
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(u) The Company and its subsidiaries have filed on a timely
basis all necessary federal, state, local and foreign income and franchise tax
returns required to be filed through the date hereof and have paid all taxes
shown as due thereon; and no tax deficiency has been asserted against the
Company or any of its subsidiaries that has not been satisfied, nor does the
Company know of any tax deficiency which is likely to be asserted against the
Company or any of its subsidiaries which if determined adversely to the Company
or such subsidiary could materially adversely affect the business, prospects,
properties, assets, results of operations or condition (financial or otherwise)
of the Company and its subsidiaries, taken as a whole. All tax liabilities are
adequately provided for on the books of the Company.
(v) The Company and each of its subsidiaries maintain insurance
or adequate reserves for self-insurance of the types and in the amounts
generally deemed adequate for their businesses.
(w) To the best of the Company's knowledge, no labor problem
exists with its employees or is threatened or imminent that could materially
adversely affect the Company and its subsidiaries, taken as a whole, and the
Company is not aware of any existing, threatened or imminent labor disturbance
by the employees of any of its principal suppliers, contractors or customers
that could be expected to materially adversely affect the business, prospects,
properties, assets, results of operation or condition (financial or other) of
the Company and its subsidiaries, taken as a whole.
(x) The Company has obtained the agreement of each of its
executive officers, directors and shareholders that, for a period of 180 days
from the date of the final prospectus, such persons will not, without the prior
written consent of ▇▇▇▇▇▇▇▇ & Company Securities, Inc., or as otherwise
described in the Prospectus, directly or indirectly sell, offer to sell, grant
any option for the sale of, or otherwise dispose of any shares of the Company's
Common Stock (including, without limitation, shares of Common Stock which may
be deemed to be beneficially owned by such persons in accordance with the 1934
Act Regulations) or any securities convertible into Common Stock.
(y) Neither the Company nor any of its officers, directors or
affiliates (as defined in the Act and the Rules and Regulations), has taken or
will take, directly or indirectly, any action designed to stabilize or
manipulate, or which has constituted, or might in the future reasonably be
expected to cause or result in, stabilization or manipulation of, the price of
the Stock of the Company in order to facilitate the sale or resale of the Stock
or otherwise.
(z) The Company's system of internal accounting controls is
sufficient to meet the broad objectives of internal accounting control insofar
as those objectives pertain to the prevention or detection of errors or
irregularities in amounts that would be material in relation to the Company's
financial statements; and, to the best of the Company's knowledge, neither the
Company nor any employee or agent of the Company or any of its subsidiaries has
made any payment of funds of the Company or any of its subsidiaries or received
or retained any
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funds and no funds of the Company or any of its subsidiaries have been set
aside to be used for any payment in violation of any law, rule or regulation.
(aa) Neither the Company nor any of its subsidiaries is or
intends to conduct its business in a manner in which it would become, an
"investment company" as defined in Section 3(a) of the Investment Company Act
of 1940, as amended.
(bb) All contracts and documents which are required to be filed
as exhibits to the Registration Statement have been so filed.
3. REPRESENTATIONS AND WARRANTIES OF THE SELLING SHAREHOLDER. The
Selling Shareholder represents and warrants to each of the Underwriters that:
(a) The Selling Shareholder now has and on the Closing Date (as
hereinafter defined) will have good and valid title to all the shares of the
Stock to be sold by the Selling Shareholder hereunder, free and clear of all
liens, encumbrances, equities, security interests and claims whatsoever, with
full legal right, power and authority to enter into this Agreement and that
upon the delivery of and payment for such shares of the Stock in accordance
herewith, the several Underwriters will acquire all of the Selling
Shareholder's rights in the shares of the Stock to be sold by the Selling
Shareholder, free of any adverse claim, assuming that the several Underwriters
acquire the certificates representing the Stock in good faith without notice of
any adverse claims.
(b) The Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to stabilize or manipulate, or
which has constituted or which might in the future reasonably be expected to
cause or result in stabilization or manipulation of, the price of the Stock of
the Company in order to facilitate the sale or resale of the Stock or
otherwise.
(c) The Selling Shareholder is disposing of such shares of the
Stock for his own account. The Selling Shareholder is not selling such shares
of the Stock, directly or indirectly, for the benefit of the Company or the
Underwriters, and no part of the proceeds of such sale to be received by the
Selling Shareholder will inure, either directly or indirectly, to the benefit
of the Company, except that the Selling Shareholder will repay all of his
outstanding indebtedness to the Company upon the consummation of the offering.
(d) This Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Shareholder and this Agreement is a
valid and binding obligation of the Selling Shareholder enforceable in
accordance with its terms.
(e) The Selling Shareholder has reviewed the Registration
Statement and the Prospectus, and neither the Registration Statement nor the
Prospectus nor any amendment or supplement thereto, will include any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading. All
information furnished in writing to the Company or the Underwriters by the
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Selling Shareholder specifically for use in the preparation of the Registration
Statement and the Prospectus and other documents to be filed with the National
Association of Securities Dealers, Inc. or state securities or Blue Sky
authorities is true and correct and does not contain an untrue statement of a
material fact nor does it omit to state any material fact required to be stated
therein or necessary to make such information not misleading.
(f) The execution and performance of this Agreement and the
consummation of the transactions herein and therein contemplated and the
fulfillment of the terms hereof and thereof will not conflict with, result in a
breach of, or constitute a default under any will, trust (constructive or
other), agreement, indenture, mortgage, note, deed, rule, regulation, order,
injunction, judgment, decree or other instrument to which the Selling
Shareholder is a party or by which he is bound.
(g) All consents, approvals, authorizations and orders
necessary for the execution and delivery by the Selling Shareholder of this
Agreement and for the sale and delivery of the Stock to be sold by the Selling
Shareholder hereunder, have been obtained, except such as may be necessary to
qualify the Stock for public offering by you under state securities or "blue
sky" laws.
(h) The Selling Shareholder is not aware that any of the
representations and warranties of the Company, set forth in Section 2 hereof,
is untrue or inaccurate in any material respect.
4. SALE, PURCHASE AND DELIVERY OF STOCK. (a) On the basis of the
representations and warranties herein contained, but subject to the terms and
conditions herein set forth, the Company and the Selling Shareholder, severally
and not jointly, hereby agree to sell to each Underwriter, and each
Underwriter, severally and not jointly, agrees to purchase from the Company and
the Selling Shareholder the respective number of shares of the Firm Stock set
forth opposite the Underwriter's name in Schedule A hereto, at a price of
$10.4625 per share. It is agreed (i) that the number of shares of Firm Stock to
be sold by the Company to each Underwriter and purchased by such Underwriter
from the Company shall be the percentage of 2,597,727 shares (Firm Shares sold
by the Company) of the Stock that the total number of shares of the Firm Stock
to be purchased by such Underwriter from the Company and the Selling
Shareholder is of 2,825,000 (total number of Firm Shares) and (ii) that the
number of shares of Firm Stock to be sold by the Selling Shareholder to each
Underwriter and purchased by such Underwriter from the Selling Shareholder
shall be the percentage of 227,273 shares (Firm Shares sold by the Selling
Shareholder) of the Stock that the total number of shares of Firm Stock to be
purchased by such Underwriter from the Company and the Selling Shareholder is
of 2,825,000 shares (total number of Firm Shares), in each instance adjusted by
the Representatives to avoid fractions and to reflect any adjustment required
by Section 13 hereof.
(b) The Company and the Selling Shareholder will deliver the
Firm Stock to you for the respective accounts of the several Underwriters at
the office of ▇▇▇▇▇▇▇▇ & Company Securities, Inc., ▇▇▇▇▇▇▇▇ Investment Center,
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, at 10:00 A.M., Cleveland time, or
to your designee at a specified place at the same time,
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against payment of the purchase price at the place of such Closing, by
certified or official bank checks in next day funds drawn in the case of shares
of the Firm Stock sold by the Company to the order of the Company and in the
case of shares of the Firm Stock sold by the Selling Shareholder to the order
of the Selling Shareholder on the third full business day after the effective
date of the Registration Statement (or, if the Firm Stock is priced after 4:30
p.m., Cleveland time on the effective date of the Registration Statement, the
fourth full business day after the effective date of the Registration
Statement), or at such other time not later than seven full business days after
such initial public offering as you shall determine, such time and place being
herein referred to as the "Closing Date." The certificates for the Firm Stock
so to be delivered will be in such denominations and registered in such names
as you may specify to the Company and the Selling Shareholder at or before 3:00
P.M., Cleveland time, on the second full business day prior to the Closing
Date. Such certificates will be made available for checking and packaging at
least 24 hours prior to the Closing Date.
(c) On the basis of the representations and warranties herein
contained, but subject to the terms and conditions herein set forth, the
Company hereby grants an option to the several Underwriters to purchase,
severally and not jointly, up to 423,750 additional shares in the aggregate of
the Option Stock at the purchase price set forth in Section 4(a) hereof, for
use solely in covering any over-allotments made by the Underwriters in the sale
and distribution of the Firm Stock. The option granted hereunder may be
exercised at any time (but not more than once) within 30 days after the date
the Registration Statement becomes effective, upon written or telegraphic
notice by the Representatives to the Company setting forth the aggregate number
of shares of the Option Stock as to which the Underwriters are exercising the
option and the time and place at which certificates will be delivered, such
time (which, unless otherwise determined by you and the Company, shall not be
earlier than three nor later than seven full business days after the exercise
of said option) being herein called the "Second Closing Date." The number of
shares of the Option Stock to be sold by the Company to each Underwriter and
purchased by such Underwriter from the Company shall be the same percentage of
the total number of shares of the Option Stock to be purchased by the several
Underwriters on the Second Closing Date as such Underwriter purchased of the
total number of shares of the Firm Stock, as adjusted by the Representatives to
avoid fractions and to reflect any adjustment required by Section 13 hereof.
The Company will deliver certificates for the shares of the Option Stock being
purchased by the several Underwriters to you on the Second Closing Date at the
place and time of such Closing, or to your designee at a specified place at the
same time, against payment of the purchase price at the place of such Closing,
by certified or official bank checks in next day funds drawn to the order of
the Company. The certificates for the Option Stock so to be delivered will be
in such denominations and registered in such names as you may specify to the
Company at or before 3:00 P.M., Cleveland time, on the second full business day
prior to the Second Closing Date. Such certificates will be made available for
checking and packaging at least 24 hours prior to the Second Closing Date. The
option granted hereby may be cancelled by you as the Representatives of the
several Underwriters, as to the shares of the Option Stock for which the option
is unexercised, at any time prior to the expiration of the 30-day period, upon
notice to the Company.
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5. OFFERING BY UNDERWRITERS. Subject to the terms and conditions
hereof, the several Underwriters agree that (i) they will offer the Stock to
the public as set forth in the Prospectus as soon after the Registration
Statement becomes effective as may be practicable, but in no event later than
5:00 p.m., Cleveland time, on the 15th business day subsequent to the date that
the Registration Statement becomes effective, and (ii) they will offer and sell
the Stock to the public only in those jurisdictions, and in such amounts, where
due qualification and/or registration has been effected or an exemption from
such qualification and/or registration is available under the applicable
securities or Blue Sky laws of such jurisdiction; it being understood, however,
that such agreement only covers the initial sale of the Stock by the
Underwriters and not any subsequent sale of such Stock in any trading market
which may develop after the public offering.
6. COVENANTS OF THE COMPANY. The Company covenants and agrees with
each of the Underwriters that:
(a) The Company will make every reasonable effort to cause the
Registration Statement to become effective and will advise you when it is
effective under the Act. The Company will not file any amendment to the
Registration Statement, or supplement to the Prospectus, of which you have not
been previously advised and furnished with a copy, or to which you have
reasonably objected in writing.
(b) The Company will advise you promptly of any request of the
Commission for amendment of the Registration Statement or Prospectus or for
additional information and 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 of which it has knowledge, and
the Company will make every reasonable effort to prevent the issuance of any
such stop order and to obtain as soon as possible the lifting thereof, if
issued.
(c) The Company will comply, to the best of its ability, with
the Act so as to permit the continuance of sales of and dealings in the Stock
under the Act for such period as may be required by the Act; whenever it is
necessary to amend or supplement the Prospectus to make the statements therein
not misleading, furnish, without charge to you as the Representatives, either
amendments to the Prospectus or supplemental information, so that the
statements in the Prospectus as so amended or supplemented will not be
misleading; and file a post-effective amendment to the Registration Statement
whenever such an amendment may be required and furnish, without charge to you,
a reasonable number of copies of any such amendment and related Prospectus.
(d) Not later than the 45th day following the end of the fiscal
quarter first occurring after the first anniversary of the Effective Date, the
Company will make generally available to its security holders and deliver to
you an earnings statement (which need not be audited) covering a period of at
least 12 months beginning not earlier than the Effective Date which shall
satisfy the provisions of Section 11(a) of the Act and/or Rule 158 promulgated
under the Act.
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(e) The Company will furnish to you copies of the Registration
Statement (two of which will be signed and will include all exhibits thereto),
each preliminary prospectus, the Prospectus, all amendments of and supplements
to such documents, and all correspondence between the Commission and the
Company or its counsel or accountants relating thereto, in each case as soon as
available and in such quantities as you may reasonably request.
(f) For a period of three years from the date of the
Prospectus, the Company will deliver to you (i) within 90 days after the end of
each fiscal year, consolidated balance sheets, statements of income, statements
of cash flow and statements of changes in stockholders' equity of the Company
and its consolidated subsidiaries, if any, as at the end of and for such year
and the last preceding year, all in reasonable detail and certified by
independent accountants, (ii) within 45 days after the end of each of the first
three quarterly periods in each fiscal year, unaudited consolidated balance
sheets and statements of income, statements of cash flow and statements of
changes in stockholders' equity of the Company and its consolidated
subsidiaries, if any, as at the end of and for such period, all in reasonable
detail, (iii) as soon as available, all such proxy statements, financial
statements and reports as the Company shall send or make available to its
stockholders or the stockholders of any subsidiary any of whose stock is owned
by any person other than the Company or any subsidiary, and (iv) copies of all
annual or periodic reports as the Company or any subsidiary shall file with the
Commission as required by the Act, the Exchange Act and any rules or
regulations thereunder, which are available for public inspection at the
Commission, or any material reports filed in connection with the Company's
listing on any stock exchange.
(g) The Company will apply the net proceeds from the sale of
the Stock sold by it in the manner set forth in the Prospectus and will timely
file with the Commission such reports on Form SR as may be required pursuant to
Rule 463 under the Act.
(h) If, at the time that the Registration Statement becomes
effective, any information shall have been omitted therefrom in reliance upon
Rule 430A promulgated under the Act, then promptly following the execution of
this Agreement, the Company will prepare, and file or transmit for filing with
the Commission in accordance with Rule 430A and Rule 424(b) promulgated under
the Act, copies of an amended Prospectus or, if required by such Rule 430A, a
post-effective amendment (including an amended Prospectus), containing all
information so omitted.
(i) The Company will file with the NASD all documents and
notices required of companies that have issued securities that are traded in
the over-the-counter market and quotations for which are reported by the
NASDAQ/NM.
(j) The Company will cooperate with you and your counsel to
qualify the Stock for sale under the securities or Blue Sky laws of such
jurisdictions within the United States as you designate, including furnishing
such information and executing such instruments as may be required, and will
continue such qualifications in effect for a period of at least three months
from the date hereof; provided, however, the Company shall not be required to
register or
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qualify as a foreign corporation or as a dealer in securities nor, except as to
matters and transactions relating to the offer and sale of the Stock, consent
to a service of process in any jurisdiction.
(k) For a period of 180 days from the time of the initial
public offering of the Stock by the Underwriters, the Company will not publicly
sell, except with your prior written consent, any Common Shares or securities
convertible into Common Shares for cash, except pursuant to the exercise of any
outstanding stock options of the Company that are described in the Prospectus.
(l) After the Closing Dates, the Company and the Subsidiaries
will be in compliance with the financial record-keeping requirements and
internal accounting control requirements of Section 13(b)(2) of the Exchange
Act.
7. COVENANTS OF THE SELLING SHAREHOLDER. The Selling Shareholder
covenants and agrees with each Underwriter that the Selling Shareholder will
not sell or transfer, without your prior written consent, any Common Shares of
the Company now held by the Selling Shareholder, alone or with any other
person, for a period of 180 days from the time of the initial offering of the
Stock by the Underwriters, except for any transfer by gift upon the condition
that the donee shall agree in writing, with a copy to be delivered to you, to
be bound by the foregoing restriction in the same manner as it applies to the
donor. However, the giving of your written consent with respect to any such
sale or transfer by the Selling Shareholder shall not constitute a waiver of
this covenant with respect to any other request by the Selling Shareholder, it
being understood that you may, in your absolute discretion, consent to certain
proposed sales and transfers and refuse to consent to others during such
180-day period. Any request from the Selling Shareholder to permit a sale or
transfer of Common Shares of the Company shall be in writing and addressed to
you and shall set forth in reasonable detail the reasons for the proposed sale
or transfer. In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Internal Revenue Code of 1986, as
amended, with respect to the transactions herein contemplated, the Selling
Shareholder agrees to deliver to you prior to or on the Closing Date a properly
completed and executed United States Treasury Department Form W-9 (or other
applicable form or statement specified by Treasury Department regulations in
lieu thereof).
8. PAYMENT OF EXPENSES. The Company will pay or cause to be paid
(and the Selling Shareholder shall reimburse the Company in such amounts and in
such proportions as may be agreed upon between the Company and the Selling
Shareholder, subject, however, to any limitations imposed by applicable state
securities or Blue Sky laws) all costs and expenses incident to the performance
of the obligations of the Company and the Selling Shareholder hereunder,
including, but not limited to, the reasonable fees and disbursements of its
counsel; the reasonable fees, costs and expenses of preparing, printing and
delivering the certificates for the Stock; the reasonable fees, costs and
expenses of the transfer agent and registrar for the Common Shares; the
reasonable fees and disbursements of its accountants; the filing fees and
reasonable expenses incurred in connection with the qualification, registration
or exemption of the Stock under state securities or Blue Sky laws and the fees
and disbursements of counsel for the
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Underwriters in connection with such qualification, registration or exemption
and the preparation and printing of the preliminary and final Blue Sky Surveys;
the filing fees and reasonable expenses paid and incurred by the Underwriters,
including fees and disbursements of counsel for Underwriters, in connection
with the review of the terms of the underwriting arrangements by the NASD; the
costs and expenses in connection with the preparation, printing and filing of
the Registration Statement (including exhibits thereto) and the Prospectus and
the furnishing to the Underwriters of such copies of each preliminary and final
Prospectus as the Underwriters may reasonably require; and the costs and
expenses in connection with the printing of this Agreement, the Agreement Among
Underwriters, the Selected Dealers Agreement and other documents distributed to
the Underwriters.
9. CONDITIONS OF THE OBLIGATION OF THE UNDERWRITERS. The obligations
of the several Underwriters to purchase and pay for the Firm Stock on the
Closing Date and the Option Stock on the Second Closing Date shall be subject
to the condition that the representations and warranties made by the Company
and the Selling Shareholder herein are true and correct as of the date hereof
and as of the respective Closing Dates, to the condition that the written
statements of Company officers and the Selling Shareholder made pursuant to the
provisions hereof are true and correct, and to the performance by the Company
and the Selling Shareholder of their respective obligations hereunder and to
the following additional conditions:
(a) The Registration Statement shall have become effective not
later than 5:00 P.M., Cleveland time, on the date of this Agreement, or at such
later time as shall have been consented to by you, and prior to each Closing
Date 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 or you,
shall be contemplated by the Commission.
(b) You shall not have advised the Company and the Selling
Shareholder that the Registration Statement or Prospectus or any amendment
thereof or supplement thereto contains an untrue statement of fact which, in
the reasonable opinion of ▇▇▇▇▇▇, Halter & ▇▇▇▇▇▇▇▇ LLP, 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 is necessary
to make the statements therein not misleading.
(c) You shall have received as of each Closing Date (or prior
thereto as indicated) the following:
(i) An opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, dated the
respective Closing Dates, to the effect that:
(aa) The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of Ohio with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus. Each of the Company's subsidiaries has been duly
incorporated and is validly existing as a corporation
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in good standing under the laws of its respective jurisdiction of
incorporation, with power and authority to own and lease its properties and
conduct its respective business.
(bb) The authorized capital stock of the Company
is as set forth under "Capitalization" in the Prospectus; all issued and
outstanding Common Shares of the Company (including the Stock to be sold by the
Selling Shareholder hereunder) have been duly authorized and validly issued and
are fully paid and nonassessable, and, to the best of the knowledge of such
counsel, are free of preemptive rights of stockholders, rights of first refusal
or similar rights. To the best knowledge of such counsel, except as described
in the Prospectus, there are no outstanding options, warrants or other rights
calling for the issuance of and there are no commitments, plans or arrangements
to issue any shares of capital stock of the Company or any security convertible
or exchangeable or exercisable for capital stock of the Company, and there are
no holders of securities of the Company who, by reason of the filing of the
Registration Statement, have the right (and have not waived such right) to
request the Company to include in the Registration Statement securities signed
by them, other than such rights as have been satisfied by the inclusion of
securities in the Registration Statement.
(cc) The Common Shares of the Company to be issued
and sold by the Company hereunder have been duly authorized, and, when issued,
delivered and paid for pursuant to this Agreement, will be validly issued,
fully paid and nonassessable. No preemptive rights of security holders of the
Company exist with respect to the issuance and sale of the stock by the Company
pursuant to this Agreement. The Common Shares of the Company conform to the
description thereof contained in the Prospectus and the certificates for the
Common Shares of the Company (including the Stock) are in due and legal form
under Ohio law.
(dd) The Company has the corporate power and
authority to enter into and perform this Agreement, and to issue and deliver
the Stock as provided herein. The execution, delivery and performance of this
Agreement by the Company and the Selling Shareholder have been duly authorized
by all necessary action of the Company and the Selling Shareholder. This
Agreement constitutes the legal, valid and binding obligation of the Company
and the Selling Shareholder, enforceable in accordance with its terms, except
as rights to indemnity may be limited by public policy and applicable federal
or state securities laws and except as enforcement thereof may be limited by
bankruptcy, insolvency or other laws of general application affecting the
enforcement of creditors' rights or by general principles of equity.
(ee) The Registration Statement has become
effective under the Act and, to the best of the knowledge of such counsel, 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 Act. The Registration Statement and the Prospectus,
and each amendment thereof or supplement thereto (except for the financial
statements and schedules and financial and statistical information included
therein as to which such counsel
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need express no opinion) comply as to form in all material respects with the
requirements of the Act and the Rules and Regulations (except for the financial
statements and schedules and financial and statistical information included
therein as to which such counsel need express no opinion); the descriptions in
the Registration Statement and the Prospectus of the Common Shares, statutes,
regulations, leases, employee benefit plans, contracts and other documents are
materially accurate and fairly present the information required to be shown;
and such counsel does not know of any legal or governmental proceedings which
are required by the Act and the Rules and Regulations to be described in the
Prospectus and which are not described as so required, or of any leases,
contracts or other documents of a character which are required by the Act and
the Rules and Regulations to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement and which
are not described and/or filed as so required.
(ff) The consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will not result in a
breach of any of the terms and provisions of, or constitute a default under,
any indenture, mortgage, deed of trust or other agreement or instrument to
which the Company or any of its subsidiaries is a party and of which such
counsel has knowledge, or any will, trust (constructive or other), agreement,
judgment, decree, or other instrument to which the Selling Shareholder is a
party or by which the Selling Shareholder is bound and of which such counsel
has knowledge, or the Articles of Incorporation or Code of Regulations of the
Company, or the organizational documents of any of its subsidiaries, or, to the
knowledge of such counsel, any order, rule or regulation applicable to the
Company or any of its subsidiaries or the Selling Shareholder of any court or
of any federal or state regulatory body or administrative agency or other
governmental body having jurisdiction over the Company or any of its
subsidiaries or the Selling Shareholder or the properties of any of them,
except for such breaches or defaults as will not have a material adverse effect
on the consummation of the transactions herein contemplated and the fulfillment
of the terms hereof by the Company or the Selling Shareholder.
(gg) All approvals, consents and orders of all
governmental bodies required in connection with the valid authorization,
issuance and sale of the Stock as contemplated by this Agreement have been
obtained, except such as may be required under the securities or Blue Sky laws
of any jurisdiction as to which such counsel need express no opinion.
(hh) To such counsel's knowledge, neither the Company
nor any of its subsidiaries is in violation of its Articles of Incorporation or
its Code of Regulations or other organizational documents, and, to the best of
the knowledge of such counsel, no default exists by the Company or any of its
subsidiaries in the due performance and observance of any term, covenant or
condition of any indenture, mortgage, deed of trust, loan agreement or other
agreement filed as an exhibit to the Registration Statement and by which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound.
(ii) Based solely on such counsel's examination of
the share records of the Company, the Selling Shareholder is, as of the
Closing Date, the owner of the shares of the Stock sold by the Selling
Shareholder pursuant to this Agreement and has full legal right and power and
all authorization and approval (if any), required by law to sell, transfer
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and deliver such shares in accordance with this Agreement, and that upon the
delivery of and payment for such shares of the Stock in accordance with this
Agreement, the several Underwriters will acquire all of the Selling
Shareholder's rights in the shares of the Stock to be sold by the Selling
Shareholder, free of any adverse claim (within the meaning of the Uniform
Commercial Code provisions that govern the Selling Shareholder's sale of these
shares of Stock to the Underwriters), assuming that the several Underwriters
acquire the certificates representing the Stock in good faith without notice of
any adverse claim (within the meaning of the Uniform Commercial Code provisions
that govern the Selling Shareholder's sale of these shares of Stock to the
Underwriters).
(jj) The Company is not an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(kk) No facts have come to the attention of such
counsel which would lead such counsel to believe that either the Registration
Statement at the time it became effective and at the Closing Date or the Second
Closing Date, as the case may be, contained an untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Prospectus
as of the date thereof and as of the Closing Date or the Second Closing Date,
as the case may be, contained an untrue statement of a material fact or omitted
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
belief or opinion with respect to the financial statements and schedules and
other financial and statistical information included therein).
In rendering such opinion, such counsel may rely
(A) as to matters involving the application of laws other than the laws of the
United States and jurisdictions in which they are admitted, to the extent
specified in such opinion, if at all, upon an opinion or opinions of other
counsel, familiar with the applicable laws; and (B) as to matters of fact on
certificates of officers of the Company and of the Selling Shareholder and
certificates or other written statements of officers of departments of various
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company and its subsidiaries. The opinion of such counsel
for the Company and the Selling Shareholder shall state that the opinion of any
such other counsel is in form satisfactory to such counsel and, in their
opinion, you and they are justified in relying thereon.
(ii) An opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq., General Counsel
of the Company, dated the respective Closing Dates, to the effect that:
(aa) To the best of his knowledge, the Company and its
subsidiaries hold and are in compliance with all necessary material
authorizations, approvals, orders, licenses, certificates and permits of and
from all governmental regulatory officials and bodies (collectively, the
"licenses") required for the conduct of its business as described in the
Prospectus, except where the failure to so hold or comply with any license
would not have,
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individually or in the aggregate, a material adverse effect on the business,
condition (financial or other) or results of operations of the Company and its
subsidiaries, taken as a whole.
(bb) To the best of his knowledge, the Company and its
subsidiaries are not in violation of any Federal or Ohio laws and regulations
that are of general application to corporations in the conduct of their
business, except where the failure so to comply or conform would not have a
material adverse effect on the business, condition (financial or other) or
results of operations of the Company and its subsidiaries, taken as a whole.
(cc) Except as set forth in the Prospectus, such
counsel does not know of any past, pending or threatened action, suit,
proceeding, inquiry or investigation before any court or before or by any
public, regulatory or governmental body or board against or involving the
business or property of the Company or any of its subsidiaries which, if
successful, could reasonably be expected to have a material adverse effect on
the business, condition (financial or other) or results of operations of the
Company and its subsidiaries, taken as a whole.
(dd) The Company and each of its subsidiaries are
duly qualified to do business as a foreign corporation and are in good
standing in all jurisdictions (i) in which the conduct of business, as
presently being conducted requires such qualification (except for those
jurisdictions in which the failure to so qualify will not in the aggregate have
a material adverse effect on the Company and its subsidiaries) and (ii) in
which the Company or such subsidiary owns or leases real property.
(ee) All the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issues, are
fully paid and non-assessable and are owned by the Company free and clear of
all liens, encumbrances, equities, security interests, or claim; and there are
no outstanding options, warrants or other rights calling for the issuance of,
and there are no commitments, plans or arrangements to issue, any shares of
capital stock of any subsidiary or any security convertible or exchangeable or
exercisable for capital stock of any subsidiary; except as disclosed in the
Registration Statement and except for the shares of stock of each subsidiary
owned by the Company, neither the Company nor any subsidiary owns, directly or
indirectly, any shares of capital stock of any corporation or has any equity
interest in any firm, partnership, joint venture, association or other entity.
In rendering such opinion, such counsel may rely
(A) as to matters involving the application of laws other than the laws of the
United States and jurisdictions in which he is admitted, to the extent
specified in such opinion, if at all, upon an opinion or opinions of other
counsel, familiar with the applicable laws; and (B) as to matters of fact on
certificates of officers of the Company. The opinion of ▇▇. ▇▇▇▇▇▇ shall state
that the opinion of any such other counsel is in form satisfactory to him and,
in his opinion, you and they are justified in relying thereon.
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(iii) Such opinion or opinions of ▇▇▇▇▇▇, Halter & ▇▇▇▇▇▇▇▇
LLP, counsel for the Underwriters, dated the respective Closing Dates, with
respect to the sufficiency of all corporate proceedings and other legal matters
relating to this Agreement, the validity of the Stock, the Registration
Statement, the Prospectus, and other related matters as you may reasonably
request, and the Company and the Selling Shareholder shall have furnished to
such counsel such documents as they may request for the purpose of enabling
them to pass upon such matters. In connection with such opinions, such counsel
may rely on representations or certificates of officers of the Company and of
the Selling Shareholder.
(iv) A certificate of the Company executed by the principal
executive officer and the principal financial and accounting officer of the
Company, dated each respective Closing Date, to the effect that:
(aa) The representations and warranties of the
Company in Section 2 of this Agreement are true and correct as of each
respective Closing Date, 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 each respective Closing Date.
(bb) No stop order suspending the effectiveness of the
Registration Statement has been issued and, to the knowledge of the respective
signers of the certificate, no proceedings for that purpose have been instituted
or are pending or are contemplated under the Act.
(cc) The signers of the certificate have carefully
examined the Registration Statement and the Prospectus; no facts have come to
their attention which would lead them to believe that either the Registration
Statement at the time it became effective (or any amendment thereof or
supplement thereto made prior to the Closing Date or the Second Closing Date,
as the case may be, as of the date of such amendment or supplement) contained
an untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectus as of the date thereof (or any amendment
thereof or supplement thereto made prior to the Closing Date or the Second
Closing Date, as the case may be, as of the date of such amendment or
supplement) contained an untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; since the latest respective dates as of which information is
given in the Registration Statement, there has been no material adverse change
in the financial position, business or results of operations of the Company and
its subsidiaries, except as set forth in or contemplated by the Prospectus; and
since the Effective Date of the Registration Statement there has occurred no
event required to be set forth in an amended or supplemented Prospectus which
has not been set forth.
(v) A certificate of the Selling Shareholder, dated the
Closing Date, to the effect that the representations and warranties of the
Selling Shareholder in Section 3 of this Agreement are true and correct as of
the Closing Date, and the Selling Shareholder has
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complied with all the agreements and satisfied all the conditions on his part
to be performed or satisfied at or prior to the Closing Date.
(vi) Letters from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP dated respectively the
date of this Agreement and each respective Closing Date, addressed to you and
in form and substance previously approved by you, with respect to the financial
statements and certain financial and statistical information contained in the
Registration Statement and the Prospectus.
(d) At or prior to the Closing Date (as indicated in the
Closing Memorandum prepared by counsel for the Underwriters and furnished to
the Company prior to the date hereof), the Company and the Selling Shareholder
shall have furnished to you such further certificates and documents provided
for in such Closing Memorandum.
(e) Prior to each Closing Date no stop orders suspending the
qualification of the Stock under the securities or Blue Sky laws of the states
in which the Stock is to be offered and sold 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 or you, shall be contemplated by the applicable
state securities administrators.
If any condition of the Underwriters' obligations hereunder to be
satisfied prior to any Closing Date is not so satisfied, this Agreement may be
terminated by you prior to such Closing Date, by notice in writing or by
telegram confirmed in writing to the Company and the Selling Shareholder.
All such opinions, certificates, letters and documents furnished to
you pursuant to this Section 9 will be in compliance with the provisions hereof
only if they are in all material respects satisfactory to you and to ▇▇▇▇▇▇,
Halter & ▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters, as to which both you and
such counsel shall act reasonably. The Company will furnish you with such
executed and conformed copies of such opinions, certificates, letters and
documents as you may request.
You, on behalf of the Underwriters, may waive in writing the
compliance by the Company or the Selling Shareholder of any one or more of the
foregoing conditions or extend the time for their performance.
10. REPRESENTATIONS OF THE UNDERWRITERS. Each of the Underwriters
severally represents and warrants to the Company and the Selling Shareholder
that the information furnished to the Company in writing by such Underwriters
or by you expressly for use in the preparation of the Registration Statement or
the Prospectus does not, and any amendments thereof or supplements thereto thus
furnished will not, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading. Through you each Underwriter has only
furnished to the Company expressly for such use, the statements made in the
last paragraph of the cover page of the Prospectus and the statements relating
to the terms of the offering by the several Underwriters set forth under the
caption "Underwriting" in the Prospectus.
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11. TERMINATION OF AGREEMENT. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if,
at the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Stock may commence, when notification of
the effectiveness of the registration statement or such post-effective
amendment has been released by the Commission. At any time before the happening
of such occurrence, the Company or the Selling Shareholder may, by notice to
you, terminate this Agreement; and at any time prior to such time, you, as the
Representatives of the several Underwriters, may, by notice to the Company and
the Selling Shareholder, terminate this Agreement.
This Agreement may also be terminated by you, as the Representatives
of the several Underwriters, by notice to the Company and the Selling
Shareholder, on or after the Effective Date of the Registration Statement and
prior to each respective Closing Date, if at any time during such period any of
the following has occurred: (i) except as disclosed in or contemplated by the
Registration Statement, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, any material adverse
change or any development involving a prospective material adverse change in or
affecting the condition, financial or otherwise, of the Company and its
subsidiaries taken as a whole or the earnings, business affairs, management or
business prospects of the Company and its subsidiaries taken as a whole,
whether or not arising in the ordinary course of business; (ii) any outbreak of
hostilities or escalation in existing hostilities anywhere in the world or
other national or international calamity or crisis or change in economic or
political conditions, if the effect of such outbreak, escalation, calamity,
crisis or change on the financial markets in the United States would, in your
reasonable judgment, make it impracticable to offer for sale or to enforce
contracts made by the Underwriters for the resale of the Stock agreed to be
purchased hereunder; (iii) any general suspension of trading in securities on
the New York Stock Exchange or the American Stock Exchange or the NASDAQ/NM or
any general limitation on prices for such trading or any general restrictions
on the distribution of securities, all to such a degree as would in your
reasonable judgment materially adversely affect the market for the Stock; or
(iv) a banking moratorium shall have been declared by either Federal, Ohio or
New York State authorities.
This Agreement may also be terminated as provided in Sections 9 and
13 hereof.
If this Agreement shall be terminated by you because of any failure
on the part of the Company or the Selling Shareholder to comply with any of the
terms or to fulfill any of the conditions of this Agreement, the Company shall
pay, in addition to the costs and expenses referred to in Section 8, all
reasonable out-of-pocket expenses incurred by the Underwriters in contemplation
of the performance by them of their obligations hereunder, including but not
limited to the reasonable fees and disbursements of counsel for the
Underwriters, the Underwriters' reasonable printing and traveling expenses and
postage, telegraph and telephone charges relating directly to the offering
contemplated by the Prospectus, and also including reasonable advertising
expenses of the Representatives incurred after the Effective Date of the
Registration Statement and so relating, it being understood that such
out-of-pocket expenses shall
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not include any compensation, salaries or wages of the officers, partners or
employees of any of the Underwriters, subject to such right of contribution, if
any, as the Company may have against the Selling Shareholder in the event of
the failure of the Selling Shareholder to comply with any of the terms or to
fulfill any of the conditions of this Agreement. Only such out-of-pocket
expenses as shall be accounted for by the Underwriters shall be paid to the
Underwriters by the Company.
The Company and the Selling Shareholder shall not in any event be
liable to the several Underwriters for damages on account of loss of
anticipated profits arising out of the transactions contemplated by this
Agreement.
12. INDEMNIFICATION. (a) The Company will indemnify and hold
harmless each Underwriter, and each person, if any, who controls each
Underwriter within the meaning of the Act, against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter or such controlling
person may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based in whole or in part on any inaccuracy in the representations and
warranties of the Company contained herein or any failure of the Company to
perform its obligations hereunder, or arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any related preliminary prospectus (if used prior to
the Effective Date), the Prospectus or any amendment thereof 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, subject to the provisions of
Section 12(d), will reimburse 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 indemnity
agreement contained in this Section 12(a) with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter or to the benefit
of any person controlling such Underwriter in respect of any loss, claim,
damage, liability or action asserted by a person who purchases shares of the
Stock from such Underwriter, if such Underwriter failed to send or give a copy
of the Prospectus (as the same may then be amended or supplemented) to such
person with or prior to written confirmation of the sale to such person; and
provided, further, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any untrue statement or omission or alleged omission made in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendment thereof or supplement thereto in reliance upon or in conformity with
written information furnished to the Company by an Underwriter specifically for
use in the preparation thereof, as referred to in the last sentence of Section
10 hereof. This indemnity agreement will be in addition to any liability which
the Company may otherwise have.
(b) The Selling Shareholder will indemnify and hold harmless each
Underwriter, and each person, if any, who controls each Underwriter within the
meaning of the Act, against any losses, claims, damages or liabilities, joint
or several, to which such Underwriter or such controlling person may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based in
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whole or in part on any inaccuracy in the representations and warranties of the
Selling Shareholder contained herein or any failure of the Selling Shareholder
to perform its obligations hereunder, or arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, any related preliminary prospectus (if used prior
to the Effective Date), the Prospectus or any amendment thereof 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, subject to the provisions of
Section 12(d), will reimburse 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 indemnity
agreement contained in this Section 12(b) with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter or to the benefit
of any person controlling such Underwriter in respect of any loss, claim,
damage, liability or action asserted by a person who purchases shares of the
Stock from such Underwriter, if such Underwriter failed to send or give a copy
of the Prospectus (as the same may then be amended or supplemented) to such
person with or prior to written confirmation of the sale to such person; and
provided further, that the Selling Shareholder will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon any untrue statement or omission or alleged omission made in
the Registration Statement, any preliminary prospectus, the Prospectus or any
amendment thereof or supplement thereto in reliance upon or in conformity with
written information furnished to the Company by an Underwriter specifically for
use in the preparation thereof, as referred to in the last sentence of Section
10 hereof. This indemnity agreement will be in addition to any liability which
the Selling Shareholder may otherwise have.
The liability of the Selling Shareholder in respect of the indemnity
agreement set forth in this Section 12 shall be limited to an amount equal to
the proceeds received by the Selling Shareholder for the shares of Stock sold
to the Underwriters pursuant to this Agreement. In addition, the Selling
Shareholder's indemnity obligations with respect to any losses, claims, damages
or liabilities to which any Underwriter or any controlling person may become
subject, which arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
any related preliminary prospectus (if used prior to the Effective Date), the
Prospectus or any amendment thereof 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, shall extend only to such losses, claims, damages and
liabilities as to which the Company has not satisfied its indemnity obligations
as set forth in Section 12(a) of this Agreement.
(c) Each Underwriter will indemnify and hold harmless the Company,
each person, if any, who controls the Company within the meaning of the Act,
each of its directors, each of its officers who have signed the Registration
Statement, and the Selling Shareholder against any losses, claims, damages or
liabilities to which the Company, or any such director, officer or Selling
Shareholder may become subject, under the Act or otherwise, 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
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Registration Statement, any preliminary prospectus, the Prospectus, or any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or the 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
Registration Statement, any preliminary prospectus, the Prospectus or any
amendment thereof or supplement thereto in reliance upon or in conformity with
written information furnished to the Company by such Underwriter through you,
as the Representatives of the Underwriters, specifically for use in the
preparation thereof, as referred to in the last sentence of Section 10 of this
Agreement; and will reimburse the Company and each such director, officer or
Selling Shareholder for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action. This indemnity agreement will be in addition to any
liability which the Underwriters may otherwise have.
(d) 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 each party against whom indemnification is to be
sought in writing of the commencement thereof; but the omission so to notify an
indemnifying party will not relieve it from any liability which they may have
to any indemnified party otherwise than under this Section. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate in, and to the extent that it may wish, to assume the
defense thereof, with counsel approved by such indemnified party (which
approval shall not be unreasonably withheld), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, 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 except as
provided below and except for the reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the defense
thereof. The indemnified party shall have the right to employ its counsel in
any such action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of counsel by such
indemnified party has been authorized in writing by the indemnifying parties,
(ii) the named parties to any such action include both the indemnifying party
and the indemnified party, and the indemnified party shall have reasonably
concluded that there is an actual or potential conflict of interest between the
indemnifying parties and the indemnified party in the conduct of the defense of
such action (in which case the indemnifying parties shall not have the right to
direct the defense of such action on behalf of the indemnified party) or (iii)
the indemnifying parties shall not have employed counsel to assume the defense
of such action within a reasonable time after notice of the commencement
thereof, in each of which cases the fees and expenses of counsel shall be at
the expense of the indemnifying parties. In no event shall the indemnifying
party or parties be liable for the fees and expenses of more than one counsel
for all indemnified parties in connection with any one or separate but similar
or related actions in the same jurisdiction arising out of the same allegations
or circumstances. Anything in this Section to the contrary notwithstanding, an
indemnifying party shall not be liable for any settlement of any claim or
action effected without its written consent.
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(e) In order to provide for contribution in circumstances in which
the indemnification provided for in this Section is for any reason held to be
unavailable from the Company, the Selling Shareholder or the Underwriters or is
insufficient to hold harmless a party indemnified hereunder, the Company, the
Selling Shareholder and the Underwriters shall contribute to the aggregate
losses, claims, damages, liabilities and expenses of the nature contemplated by
such indemnification provisions (including any investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claims asserted, but after deducting in the
case of losses, claims, damages, liabilities and expenses suffered by the
Company and the Selling Shareholder any contribution received by the Company or
the Selling Shareholder from persons, other than the Underwriters, who may also
be liable for contribution, including persons who control the Company within
the meaning of the Act, officers of the Company who signed the Registration
Statement and directors of the Company) to which the Company, the Selling
Shareholder and one or more of the Underwriters may be subject, in such
proportions as is appropriate to reflect the relative benefits received by the
Company, the Selling Shareholder and the Underwriters from the offering of the
Stock or, if such allocation is not permitted by applicable law or
indemnification is not available as a result of the indemnifying party not
having received notice as provided in this Section, in such proportion as is
appropriate to reflect not only the relative benefits referred to above but
also the relative fault of the Company, the Selling Shareholder and the
Underwriters in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the
Company, the Selling Shareholder and the Underwriters shall be deemed to be in
the same proportion as (x) the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company, (y) the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Selling Shareholder and (z) the underwriting discounts and commissions received
by the Underwriters, respectively, in each case as set forth in the table on
the cover page of the Prospectus. The relative fault of the Company, the
Selling Shareholder and of the Underwriters shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omissions or alleged omission to state a material fact
relates to information supplied by the Company, the Selling Shareholder or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company,
the Selling Shareholder and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 12(e) were determined by
pro rata allocation even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above. The Company and the Selling
Shareholder shall be severally, and not jointly, liable for the amounts to be
contributed by each of them pursuant to the provisions of this Section 12(e).
Notwithstanding the provisions of this Section 12(e), (i) in no case shall any
Underwriter (except as may be provided in the Agreement Among Underwriters) be
liable or responsible for any amount in excess of the underwriting discounts
and commissions applicable to the Stock purchased by such Underwriter hereunder
and (ii) no person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person,
if any, who was not guilty of such fraudulent
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misrepresentation. For purposes of this Section 12(e), each person, if any, who
controls an Underwriter within the meaning of Section 15 of the Act shall have
the same rights to contribution as such Underwriter, and each person, if any,
who controls the Company within the meaning of Section 15 of the Act, each
officer of the Company who shall have signed the Registration Statement and
each director of the Company shall have the same rights to contribution as the
Company, subject in each case to clauses (i) and (ii) of this Section 12(e).
Any party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties
under this Section 12(e), notify such party or parties from whom contribution
may be sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought from any
obligation it or they may have under this Section 12(e) or otherwise. No party
shall be liable for contribution for any settlement of any action or claim
effected without its written consent.
13. DEFAULT OF THE UNDERWRITERS. If any Underwriter or Underwriters
default in their obligations to purchase the Stock hereunder and arrangements
satisfactory to you, the Company and the Selling Shareholder, evidenced by a
writing or writings signed by you, the Company and the Selling Shareholder, for
the purchase of such Stock by other persons are not made within 36 hours after
such default, this Agreement will terminate without liability on the part of
any non-defaulting Underwriter, the Company and the Selling Shareholder (except
that the Company shall be liable for the expenses to be paid by it pursuant to
the provisions of Section 8), provided, however, that if the number of shares
of the Stock which all such defaulting Underwriters have agreed but failed to
purchase shall not exceed 10% of the number of shares of the Firm Stock or the
Option Stock, as the case may be, agreed to be purchased pursuant to this
Agreement (other than the shares agreed to be taken up hereunder which the
defaulting Underwriters failed to purchase) by all non-defaulting Underwriters,
the non-defaulting Underwriters shall be obligated proportionately to take up
and pay for the shares of the Firm Stock or the Option Stock which such
defaulting Underwriters failed to purchase.
If any such default occurs, either you or the Company or the Selling
Shareholder shall have the right to postpone the 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
arrangement, may be effected. As used in this Agreement, the term
"Underwriters" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from its
liability to the other several Underwriters, the Company and the Selling
Shareholder for its default hereunder.
14. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations and warranties of the
Company, the Selling Shareholder and the several Underwriters, set forth in or
made pursuant to this Agreement, will remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter, the
Company or any of its officers or directors or any controlling person or the
Selling Shareholder, and will survive delivery of and payment for the Stock
and, in the case of the agreements contained in Sections 8, 11 and 12 hereof,
will survive any termination of this Agreement.
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15. NOTICES. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to you at ▇▇▇▇▇▇▇▇ & Company Securities, Inc., ▇▇▇▇▇▇▇▇ Investment
Center, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇, Halter & ▇▇▇▇▇▇▇▇ LLP, 1400 ▇▇▇▇▇▇▇▇ Investment
Center, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Esq., or if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to the Company at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, General Counsel, with a copy to ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
LLP, 3200 National City Center, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇, Esq., or if sent to the Selling Shareholder, will be
mailed, delivered or telegraphed and confirmed to the Selling Shareholder at
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇.
16. SUCCESSORS, GOVERNING LAW. This Agreement will inure solely to
the benefit of and be binding upon the parties hereto and the officers and
directors and controlling persons referred to in Section 12 hereof and their
respective successors, assigns, heirs, executors and administrators, and no
other persons will have any right or obligation hereunder. This Agreement will
be governed by and construed in accordance with the laws of the State of Ohio,
without giving effect to the principles of conflicts of laws thereof.
17. EXECUTION IN COUNTERPARTS. This Agreement may be executed by any
one or more of the parties hereto in any number of counterparts, each of which
shall be deemed to be an original, but all such counterparts shall together
constitute one and the same instrument.
18. AUTHORITY OF THE REPRESENTATIVES. You represent and warrant that
you have been authorized by the several Underwriters to enter into this
Agreement on their behalf and to act for them in the manner hereinbefore
provided.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed copies hereof, whereupon
it will become a binding agreement by and among the Company, the Selling
Shareholder and the several Underwriters in accordance with its terms.
Very truly yours,
INTERNATIONAL TOTAL SERVICES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Its: Chairman and Chief Executive Officer
--------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
The Selling Shareholder
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
The foregoing Agreement is hereby confirmed
and accepted by us in Cleveland, Ohio,
acting on our own behalf and as
the Representatives of the several Underwriters
named on Schedule A annexed hereto, as of
the date first above written.
▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, INC.
As Representatives of the Several Underwriters
By: ▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
Managing Director
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SCHEDULE A
UNDERWRITERS
Number of Shares to
Underwriter be Purchased
----------- ------------
▇▇▇▇▇▇▇▇ & Company Securities, Inc.......................... 1,052,500
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Company, Inc................................ 1,052,500
Advest, Inc................................................. 40,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated.......................... 40,000
▇▇▇▇▇▇ Gull ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Inc.......................... 40,000
▇▇▇▇▇ & Company............................................. 40,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Co........................................ 40,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co., L.L.C......................... 40,000
GS2 Securities, Inc......................................... 40,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Inc......................................... 40,000
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co................................ 40,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Inc................................. 40,000
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated........................ 40,000
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, Incorporated....................... 40,000
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Refsnes, Inc................................ 40,000
▇▇▇▇▇ & Co. L.L.C........................................... 40,000
The ▇▇▇▇▇▇▇ Companies Incorporated.......................... 40,000
Sutro & Co. Incorporated.................................... 40,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Incorporated................................. 40,000
Unterberg ▇▇▇▇▇▇, ▇.▇....................................... 40,000
------
Total..................................... 2,825,000
=========
A-1
