SECURITIES AND UNITED STATES EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ____)*
MANCHESTER EQUIPMENT CO., INC.
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
(Title of Class of Securities)
562154 10 4
(CUSIP Number)
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March 14, 1997 and March 20, 1997
(Dates of Events Which Require Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box. |X|
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
(Continued on following pages)
(Page 1 of 7 Pages)
(List of Exhibits is on Page 7)
-----------------------
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
SCHEDULE 13D
CUSIP No. 562154 10 4
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1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Barry R. Steinberg
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |X|
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3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS
Not applicable. See Item 3.
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E) |_|
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
- --------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 4,585,101
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
----------------------------------------------------
8. SHARED VOTING POWER
0
----------------------------------------------------
9. SOLE DISPOSITIVE POWER
4,585,101
----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,585,101 See Item 5(a).
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES |_|
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
53.8% See Item 5(a).
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14. TYPE OF REPORTING PERSON
IN
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<PAGE>
SCHEDULE 13D
CUSIP No. 562154 10 4
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Ilene Steinberg
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) |_|
(b) |X|
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
OO. See Item 3.
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E) |_|
- --------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
- --------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
SHARES 35,000
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
----------------------------------------------------
8. SHARED VOTING POWER
0
----------------------------------------------------
9. SOLE DISPOSITIVE POWER
35,000
----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,000 See Item 5(a).
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES |_|
- --------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
.4% See Item 5(a).
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15. TYPE OF REPORTING PERSON
IN
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<PAGE>
SCHEDULE 13D
CUSIP No. 562154 10 4
- --------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Sheryl Steinberg
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |X|
- --------------------------------------------------------------------------------
3. SEC USE ONLY
- --------------------------------------------------------------------------------
4. SOURCE OF FUNDS
OO. See Item 3.
- --------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E) |_|
- -------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
- --------------------------------------------------------------------------------
NUMBER OF 7. SOLE VOTING POWER
35,000
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
----------------------------------------------------
8. SHARED VOTING POWER
0
----------------------------------------------------
9. SOLE DISPOSITIVE POWER
35,000
----------------------------------------------------
10. SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
35,000 See Item 5(a).
- --------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES |_|
- -------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
.4% See Item 5(a).
- --------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
<PAGE>
1. Security and Issuer.
The securities to which this Schedule 13D relate are the shares of Common
Stock, $.01 par value ("Common Stock"), of Manchester Equipment Co., Inc. (the
"Issuer"), a corporation organized under the laws of the State of New York. The
address of the Issuer's principal executive office is 160 Oser Avenue,
Hauppauge, New York 11788.
2. Identity and Background.
(a) The persons filing this statement are Barry R. Steinberg, Ilene
Steinberg and Sheryl Steinberg. Ilene Steinberg and Sheryl Steinberg are each
daughters of Barry R. Steinberg, and each of them is over the age of 21. Neither
of his daughters resides with Mr. Steinberg.
(b) The business address of each of the persons filing this statement is
160 Oser Avenue, Hauppauge, New York 11788.
(c) Mr. Steinberg is the President and Chief Executive Officer of the
Issuer. Ilene Steinberg is employed by the Issuer as manager of its Art
Department. Sheryl Steinberg is employed by the Issuer as Assistant Sales
Manager.
(d) During the last five years, none of the persons filing this statement
have been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) During the last five years, none of the persons filing this statement
have been party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which proceeding he or she was or is
subject to a judgment, decree or final order enjoining future violation of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
(f) Each of the persons filing this statement is a United States citizen.
3. Source and Amount of Funds or Other Consideration.
On March 14, 1997, Mr. Steinberg loaned $200,000 to each of Ilene Steinberg
and Sheryl Steinberg (the "Loans") for the purpose of enabling each of them to
acquire shares of Common Stock of the Issuer (the "Shares"). The Loans are due
on March 14, 2002, bear interest at the rate of 7 1/2% per annum payable
annually on each anniversary of the Loans, and are evidenced by promissory
notes, each dated March 14, 1997, from each of Ilene Steinberg and Sheryl
Steinberg to Mr. Steinberg (the "Notes"). Mr. Steinberg has no direct or
indirect pecuniary interest in the Shares. Copies of the Notes are attached
hereto and are incorporated herein by reference as Exhibits 1 and 2,
respectively.
As a result of the agreement to loan funds to purchase the Shares, Mr.
Steinberg, Ilene Steinberg and Sheryl Steinberg may be deemed a "group" pursuant
to Rule 13d-5(b)(1) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Mr. Steinberg, Ilene Steinberg and Sheryl Steinberg do not
affirm the existence of a group, and each such person disclaims beneficial
ownership of shares of Common Stock beneficially owned by the others.
4. Purpose of Transaction.
All of the shares of Common Stock of which the filing persons are deemed to
be the beneficial owners for purposes of this Schedule 13D were purchased or
acquired for investment purposes. Although the filing persons have no present
plans or proposals of the type set forth in paragraphs (a) through (j) of Item 4
of the Special Instructions for Complying with Schedule 13D, one or more of them
may make open market purchases and sales of the Issuer's Common Stock from time
to time, depending on a number of factors, including, without limitation, the
market price of such Common Stock. <PAGE> 5. Interest in Securities of the
Issuer.
(a) The aggregate number of shares of Common Stock and the percentage of
outstanding shares of Common Stock (based upon the 8,525,000 shares of Common
Stock outstanding on February 28, 1997, as represented by the Issuer in the Form
10-Q, dated March 12, 1997), beneficially owned by each person named in Item 2
above, as of the close of business on March 24, 1997, is set forth below:
<TABLE>
<CAPTION>
Shares Percentage of
Name of Holder Beneficially Owned Outstanding Shares
<S> <C> <C>
Barry R. Steinberg.................. 4,585,101 53.8%
Ilene Steinberg..................... 35,0001 .4%
Sheryl Steinberg.................... 35,0002 .4%
Total 4,655,101 54.6%
</TABLE>
(b) Each of the persons named above has the sole power to vote or direct
the vote and sole power to dispose of or direct the disposition of the shares of
Common Stock beneficially owned by him or her.
(c) On March 14, 1997, each of Ilene Steinberg and Sheryl Steinberg
purchased 5,000 shares of the Issuer's Common Stock at a purchase price of $4
5/8 per share. On March 20, 1997, each of Ilene Steinberg and Sheryl Steinberg
purchased 5,000 shares of the Issuer's Common Stock at a purchase price of $4
1/2 per share. The transactions were effected on the open market. The Issuer's
Common Stock is traded on The Nasdaq National Market.
(d) Not applicable.
(e) Not applicable.
6. Contracts, Arrangements, Understandings or Relationships with respect to
Securities of the Issuer.
As evidenced by the Notes, Mr. Steinberg has loaned to each of Ilene
Steinberg and Sheryl Steinberg the sum of $200,000. Each of Ilene Steinberg and
Sheryl Steinberg used a portion of the proceeds of such loans to purchase 10,000
shares of the Issuer's Common Stock.
Mr. Steinberg is a party to an agreement dated November 18, 1996, with
Ladenburg Thalmann & Co. Inc. and Cruttenden Roth Incorporated (collectively,
the "Representatives"), pursuant to which Mr. Steinberg agreed that, for a
period of 180 days following the effective date of the Issuer's Registration
Statement on Form S-1 (No. 333-13345)(the "Effective Date"), he would not,
directly or indirectly, offer, pledge, sell, contract to sell, transfer or
otherwise dispose of (i) any shares of the Issuer's Common Stock or (ii) any
other securities convertible into, or exchangeable or exercisable for, shares of
Common Stock (together with the Common Stock, the "Securities"), without the
prior written consent of the Representatives; provided, however, that Mr.
Steinberg is permitted thereunder to sell, contract to sell, transfer, donate or
bequeath any of the Securities during such period if the transaction is exempt
from registration under the Securities Act of 1933, as amended (the "Securities
Act"), and the transferee of the Securities agrees, prior to the transaction, to
be bound by all of the provisions of such agreement (the "Lock-Up Agreement").
Mr. Steinberg is also a party to an Underwriting Agreement dated November
25, 1996 with the Representatives, pursuant to which Mr. Steinberg agreed that,
for a period of 180 days following the Effective
--------
1 On January 2, 1997, Barry R. Steinberg made a gift of 25,000
shares of the Issuer's Common Stock to Ilene Steinberg.
2 On January 2, 1997, Barry R. Steinberg made a gift of 25,000 shares of the
Issuer's Common Stock to Sheryl Steinberg.
<PAGE>
Date, he would not, without the prior written consent of the Representatives,
sell, contract to sell, transfer or otherwise dispose of any shares of the
Issuer's Common Stock owned by him or held of record in his name; provided,
however, that Mr. Steinberg is permitted thereunder to sell, contract to sell,
transfer, donate or bequeath any shares of the Issuer's Common Stock during such
period if the transaction is exempt from registration under the Securities Act,
and the transferee agrees, prior to the transaction, to be bound by such
restrictions on transfer. In addition, pursuant to such Agreement, Mr. Steinberg
agreed to indemnify the Underwriters (as defined therein) against certain
liabilities, including certain liabilities under the Securities Act, and to
contribute to payments the Underwriters may be required to make in respect
thereof.
Each of Ilene Steinberg and Sheryl Steinberg is a party an agreement with
Mr. Steinberg, dated January 2, 1997, pursuant to which they agreed to be bound
by the terms of the Lock-Up Agreement.
Except as set forth above, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) among the persons named in
Item 2 and between such persons and any person with respect to any securities of
the Issuer.
<PAGE>
7. Material to be filed as Exhibits.
1. Copy of Promissory Note, dated March 14, 1997, by Ilene Steinberg, as
Maker, to Barry R. Steinberg, as Payee.
2. Copy of Promissory Note, dated March 14, 1997, by Sheryl Steinberg, as
Maker, to Barry R. Steinberg, as Payee.
3. Agreement dated November 18, 1996, among Barry R. Steinberg, Ladenburg
Thalmann & Co. Inc. and Cruttenden Roth Incorporated
4. Underwriting Agreement dated November 24, 1996, among Manchester Equipment
Company, Inc., Barry R. Steinberg, Ladenburg Thalmann & Co. Inc. and
Cruttenden Roth Incorporated by reference to Exhibit 1 to Amendment No. 1,
dated November 7, 1996, to the Issuer's Registration Statement on Form S-1
(No. 333-13345)
5. Agreement dated January 2, 1997, between Barry R. Steinberg and Ilene
Steinberg
6. Agreement dated January 2, 1997, between Barry R. Steinberg and Sheryl
Steinberg
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, each
of us certifies that the information set forth in this statement is true,
complete and correct.
/s/ Barry R. Steinberg
-----------------------
Date: March 24, 1997 Barry R. Steinberg
s/s Ilene Steinberg
-------------------
Ilene Steinberg
s/s Sheryl Steinberg
-------------------
Sheryl Steinberg
Exhibit 1
With Exchange
$200,000.00, New York, N.Y., March 14, 1997
ON March 14, 2002 after date I promise to pay to the order of Barry R.
Steinberg the sum of TWO HUNDRED THOUSAND and 00/100 DOLLARS
Payable at 13 Harbour Point Drive, Northport, NY 11768
Interest, at the rate of seven and one-half (7 1/2%) percent per annum,
shall be due and payable on the remaining Principal Balance, if any, on the
following dates:
March 14, 1998; March 14, 1999; March 14, 2000; March 14, 2001; March 14,
2002.
This is Note No. 1 of series of 1 Note. Upon default in the payment of this
Note or of any other Note or Notes of the maker or any endorser or guarantor
hereof, held or acquired by holder hereof, all of the aforesaid Notes shall
immediately become due and payable in the event such default is not cured within
ten (10) days after the forwarding of a written notice of such default,
forwarded Certified Mail, Return Receipt, to the Maker.
The makers, endorser and guarantors of this Note hereby waive presentment
for payment, demand for payment, notice of non-payment and dishonor, protest and
notice of protest; waive trial by jury in any action or proceeding arising on,
out of, under or by reason of this Note; consent to any renewals, extensions and
partial payment of this Note or the indebtedness for which it is given without
notice to them and consent that no such renewals, extensions or partial payments
shall discharge any party hereto from liability in whole or in part.
The within Note and the series of Notes of which this Note forms a part,
shall become immediately due and payable in the event a petition under any
provisions of the Bankruptcy Act or any other insolvency statute for any relief
thereunder shall be filed by or against any maker, endorser or guarantor hereof.
In the event this Note be not paid when due, and it be placed with an attorney
for collection, the maker, makers, endorser and guarantors agree to pay all
costs of collection, including an attorney's fee of 20% of the amount of this
Note, which is hereby agreed to be just and reasonable and which shall be added
to the amount due under this Note and shall be recoverable with the amount due
under this Note and shall be a lien on any collateral securing this Note. In the
event any endorser or guarantor of this Note shall pay the amount of the same to
the holder thereof at maturity and thereafter shall place the same with an
attorney for collection against the maker, makers, prior endorser, guarantors,
or any of them, then the maker, makers, prior endorser, guarantors, or any of
them, agree to pay to the said endorser or guarantor all costs of collection,
including an attorney's fee of 20%, which is hereby agreed to be just and
reasonable and which shall be added as above provided to the amount due under
this Note.
Value Received-Interest at
7-1/2 percent per annum
/s/ Ilene D. Steinberg
ILENE STEINBERG
Exhibit 2
With Exchange
$200,000.00, New York, N.Y., March 14, 1997
ON March 14, 2002 after date I promise to pay to the order of Barry R. Steinberg
the sum of TWO HUNDRED THOUSAND and 00/100 DOLLARS
Payable at 13 Harbour Point Drive, Northport, NY 11768
Interest, at the rate of seven and one-half (7-1/2%) percent per annum,
shall be due and payable on the remaining Principal Balance, if any, on the
following dates:
March 14, 1998; March 14, 1999; March 14, 2000; March 14, 2001; March 14,
2002.
This is Note No. 1 of series of 1 Note. Upon default in the payment of this
Note or of any other Note or Notes of the maker or any endorser or guarantor
hereof, held or acquired by holder hereof, all of the aforesaid Notes shall
immediately become due and payable in the event such default is not cured within
ten (10) days after the forwarding of a written notice of such default,
forwarded Certified Mail, Return Receipt, to the Maker.
The makers, endorser and guarantors of this Note hereby waive presentment
for payment, demand for payment, notice of non-payment and dishonor, protest and
notice of protest; waive trial by jury in any action or proceeding arising on,
out of, under or by reason of this Note; consent to any renewals, extensions and
partial payment of this Note or the indebtedness for which it is given without
notice to them and consent that no such renewals, extensions or partial payments
shall discharge any party hereto from liability in whole or in part.
The within Note and the series of Notes of which this Note forms a part,
shall become immediately due and payable in the event a petition under any
provisions of the Bankruptcy Act or any other insolvency statute for any relief
thereunder shall be filed by or against any maker, endorser or guarantor hereof.
In the event this Note be not paid when due, and it be placed with an attorney
for collection, the maker, makers, endorser and guarantors agree to pay all
costs of collection, including an attorney's fee of 20% of the amount of this
Note, which is hereby agreed to be just and reasonable and which shall be added
to the amount due under this Note and shall be recoverable with the amount due
under this Note and shall be a lien on any collateral securing this Note. In the
event any endorser or guarantor of this Note shall pay the amount of the same to
the holder thereof at maturity and thereafter shall place the same with an
attorney for collection against the maker, makers, prior endorser, guarantors,
or any of them, then the maker, makers, prior endorser, guarantors, or any of
them, agree to pay to the said endorser or guarantor all costs of collection,
including an attorney's fee of 20%, which is hereby agreed to be just and
reasonable and which shall be added as above provided to the amount due under
this Note.
Value Received-Interest at
7-1/2 percent per annum
/s/ Sheryl Steinberg
---------------------
SHERYL STEINBERG
Exhibit 3
November 18, 1996
Ladenburg Thalmann & Co. Inc.
Cruttenden Roth Incorporated
c/o Ladenburg Thalmann & Co. Inc.
As Representatives of the
Several Underwriters
590 Madison Avenue
New York, New York 10022
Re: Manchester Equipment Co., Inc.
Gentlemen:
In order to induce you as the Representatives of the several Underwriters
to enter into an underwriting agreement (the "Underwriting Agreement") with
Manchester Equipment Co., Inc., a New York corporation (the "Company"), with
respect to the proposed public offering of common stock (the "Common Stock"),
$.01 par value, of the Company and the selling stock holders (the "Selling
Stockholders"), the undersigned agrees that, for a period of 180 days following
the effective date of the Company's Registration Statement on Form S-1 (No.
333-13345), the undersigned will not, directly or indirectly, offer, pledge,
sell, contract to sell, transfer or otherwise dispose of (i) any shares of
Common Stock of the Company or (ii) any other securities convertible into, or
exchangeable or exercisable for, shares of Common Stock (together with the
Common Stock, the "Securities"), without the prior written consent of Ladenburg
Thalmann & Co. Inc. and Cruttenden Roth Incorporated; provided, however, that
the undersigned may sell, contract to sell, transfer, donate or bequeath any of
the Securities during this period if the transaction is exempt from registration
under the Securities Act of 1933, as amended, and the transferee of the
Securities agrees, prior to the transaction, to be bound by all of the
provisions of this letter. The undersigned is aware that you are relying on this
agreement in entering into the Underwriting Agreement. This agreement is subject
to the execution and delivery of the Underwriting Agreement by the Company and
you.
Very truly yours,
/s/ Barry R. Steinberg
----------------------
Barry R. Steinberg
Exhibit 5
BARRY R. STEINBERG
160 Oser Avenue
Hauppauge, New York 11788
January 2, 1997
Ms. Ilene Steinberg
420 East 54th Street
New York, New York 10022
RE: Manchester Equipment Co., Inc. (the "Company")
Dear Ilene:
As you know, I plan to gift to you 25,000 shares of the Company's Common
Stock, $.01 par value (the "Shares"). I am party to an agreement dated November
18, 1996, a copy of which is enclosed with this letter (the "Lock-Up
Agreement"). Pursuant to the Lock-Up Agreement, I may not gift the Shares to you
unless you agree, prior thereto, to be bound by all of the provisions of the
Lock-Up Agreement. I would appreciate your indicating such agreement by signing
the enclosed duplicate copy of this letter where set forth below, and returning
the same to me.
In addition, please be advised that the Shares are not registered, and are
"restricted securities" as that term is defined in Rule 144 under the Securities
Act of 1933, as amended (the "Act"). Accordingly, any sale of the Shares must be
made in compliance with Rule 144, pursuant to registration under the Act or
pursuant to an exemption therefrom. Moreover, as with any holder of the
Company's restricted securities, an opinion of counsel to the Company will be
required with respect to any further transfer of the Shares.
Please do not hesitate to call me if you have any questions.
Sincerely,
/s/ Barry R. Steinberg
----------------------
Barry R. Steinberg
The undersigned agrees to be bound by all of the provisions of the Lock-Up
Agreement, and to be in compliance with Rule 144 of the Securities Act of 1933.
Ilene Steinberg
By: /s/ Ilene D. Steinberg
- --------------------------
Exhibit 6
BARRY R. STEINBERG
160 Oser Avenue
Hauppauge, New York 11788
January 2, 1997
Ms. Sheryl Steinberg
420 East 54th Street
New York, New York 10022
RE: Manchester Equipment Co., Inc. (the "Company")
Dear Sheryl:
As you know, I plan to gift to you 25,000 shares of the Company's Common
Stock, $.01 par value (the "Shares"). I am party to an agreement dated November
18, 1996, a copy of which is enclosed with this letter (the "Lock-Up
Agreement"). Pursuant to the Lock-Up Agreement, I may not gift the Shares to you
unless you agree, prior thereto, to be bound by all of the provisions of the
Lock-Up Agreement. I would appreciate your indicating such agreement by signing
the enclosed duplicate copy of this letter where set forth below, and returning
the same to me.
In addition, please be advised that the Shares are not registered, and are
"restricted securities" as that term is defined in Rule 144 under the Securities
Act of 1933, as amended (the "Act"). Accordingly, any sale of the Shares must be
made in compliance with Rule 144, pursuant to registration under the Act or
pursuant to an exemption therefrom. Moreover, as with any holder of the
Company's restricted securities, an opinion of counsel to the Company will be
required with respect to any further transfer of the Shares.
Please do not hesitate to call me if you have any questions.
Sincerely,
/s/ Barry R. Steinberg
----------------------
Barry R. Steinberg
The undersigned agrees to be bound by all of the provisions of the Lock-Up
Agreement, and to be in compliance with Rule 144 of the Securities Act of 1933.
Sheryl Steinberg
By: /s/ Sheryl Steinberg
- --------------------------
