As filed with the Securities and Exchange Commission on April 22, 1998
Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
INDUSTRIAL SERVICES OF AMERICA, INC.
(Exact name of registrant as specified in its charter)
Florida 59-0172746
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
7100 Grade Lane, P.O. Box 32428, Louisville, Kentucky 40232 (502) 368-1661
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
Harry Kletter
Industrial Services of America, Inc.
7100 Grade Lane
P.O. Box 32428
Louisville, Kentucky 40232
(502) 368-1661
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copy to:
Alex P. Herrington, Jr.
Stites & Harbison
400 W. Market Street, Suite 1800
Louisville, Kentucky 40202-3352
(502) 587-3400
Approximate date of proposed sale to the public: As soon as practicable after
this Registration Statement becomes effective.
<PAGE>
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. |_|
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
Proposed Proposed
maximum maximum
Title of offering aggregate Amount of
Securities to Amount to be price per offering registration
be registered registered share (1) price (1) fee
Common Stock,
$.01 par value 400,000 $5.875 $2,350,000 $694
- -------------------------------------------------------------------------------
(1)Based on the average of the bid and asked prices reported on the Nasdaq
Small-Cap Market on April 20, 1998 and for the purpose of calculating the
registration fee pursuant to Rule 457 under the Securities Act of 1933, as
amended.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
<PAGE>
PROSPECTUS
INDUSTRIAL SERVICES OF AMERICA, INC.
400,000 SHARES
COMMON STOCK, $.01 PAR VALUE
This Prospectus is part of a Registration Statement which registers an aggregate
of 400,000 shares of Common Stock, $.01 par value ("Common Stock") of Industrial
Services of America, Inc. (the "Company"), a Florida corporation, which may be
issued, as set forth herein, to certain Optionees described herein
("Optionees"), pursuant to common stock options ("Options") to purchase up to
400,000 shares of the Common Stock of the Company. The Options were granted to
Optionees by Harry Kletter, Chairman of the Board and Chief Executive Officer
and an "affiliate" of the Company under the federal securities laws, acting in
his individual capacity, in privately negotiated transactions pursuant to
certain Stock Option Agreements, each dated as of January 2, 1998. Optionees may
reoffer and resell all or a portion of their shares of Common Stock from time to
time as follows: (a) block trades in which the brokers or dealers so engaged
will attempt to sell shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction; (b) purchases by a broker
or dealer as principal and resale by such broker or dealer for its account
pursuant to this Prospectus; (c) ordinary brokerage transactions and
transactions in which the broker solicits purchasers; and (d) in privately
negotiated transactions not involving a broker or dealer. In effecting sales,
brokers or dealers engaged to sell shares may arrange for other brokers or
dealers to participate. Brokers or dealers engaged to sell shares will receive
compensation in the form of commissions or discounts in amounts to be negotiated
by Optionees immediately prior to each sale. The Company will receive no
proceeds from any sales of Common Stock by Optionees. Optionees and the brokers
and dealers through whom sales of the shares are made may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"), and any profits realized by them on the sale of the shares
may be considered to be underwriting compensation.
No person is authorized to give any information or make any representation not
contained or incorporated by reference in this Prospectus in connection with the
offer contained in this Prospectus, and, if given or made, such other
information or representation must not be relied upon as having been authorized
by the Company. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company since the date hereof.
The Common Stock of the Company is listed on the Nasdaq Small-Cap Market under
the trading symbol "IDSA." On _______________, 1998, the last reported sale
price of the Company's Common Stock on the Nasdaq Small-Cap Market was $____ per
share.
See "Risk Factors" beginning on page 3 for certain information relevant to an
investment in the Common Stock.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
This Prospectus does not constitute an offer to sell or the solicitation of any
offer to buy any security other than the securities covered by this Prospectus,
nor does it constitute an offer or solicitation by anyone in any jurisdiction in
which such offer or solicitation is not authorized, or in which the person
making such offer or solicitation is not qualified to do so, or to any person to
whom it is unlawful to make such offer or solicitation.
The date of the Prospectus is _______, 1998.
<PAGE>
A. AVAILABLE INFORMATION
Industrial Services of America, Inc. (the "Company") is subject to the
informational requirements of Section 15(d) of the Securities Exchange Act of
1934 (the "Exchange Act"), and, in accordance therewith, files reports, proxy
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports and other information filed by the Company can
be inspected and copied (at prescribed rates) at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549
and at its regional offices at Citicorp Center, 500 West Madison Street,
Chicago, Illinois 60661, and Seven World Trade Center, New York, New York 10048.
The Company's Common Stock is listed on the Nasdaq Small-Cap Market under the
symbol "IDSA" and reports and other information concerning the Company can be
inspected and copied at the offices of the National Association of Securities
Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006. If available, such
reports and other information may also be accessed through the Commission's
electronic data gathering, analysis and retrieval system ("EDGAR") via
electronic means, including the Commission's web site on the Internet
(http://www.sec.gov).
The Company has filed with the Commission a Registration Statement on Form
S-3 (the "Registration Statement") under the Securities Act of 1933, as amended
(the "Act"), with respect to an aggregate of 400,000 shares of the Company's
Common Stock, which may be issued to Optionees upon the exercise of the Options.
This Prospectus does not contain all of the information set forth in the
Registration Statement, certain portions of which have been omitted as permitted
by the rules and regulations of the Commission. For further information with
respect to the Company and the shares of the Common Stock offered by this
Prospectus, reference is made to the Registration Statement, including the
exhibits thereto. Statements in this Prospectus as to any document are not
necessarily complete, and where any such document is an exhibit to the
Registration Statement or is incorporated by reference herein, each such
statement is qualified in all respects by the provisions of such exhibit or
other document, to which reference is hereby made, for a full statement of the
provisions thereof. A copy of the Registration Statement, with exhibits, may be
obtained from the Commission's office in Washington, D.C. (at the above address)
upon payment of the fees prescribed by the rules and regulations of the
Commission, or examined there without charges.
B. INFORMATION INCORPORATED BY REFERENCE
The following documents filed with the Commission are incorporated herein
by reference:
1. The Company's latest Annual Report on Form 10-K for its fiscal year
ended December 31, 1997;
2. The Company's report on Form 8-K filed March 3, 1998.
3. The description of the Company's Common Stock contained in its
Registration Statement on Form S-1, dated May 22, 1969.
4. All other reports filed pursuant to Section 13 or 15(d) of the Exchange
Act since the end of the fiscal year covered by the Annual Report on Form 10-K
referred to in paragraph 1 above.
All reports and other documents subsequently filed by the Company pursuant
to sections 13(a), 13(c), and 15(d) of the Exchange Act prior to the termination
of the offering shall be deemed to be incorporated by reference herein and to be
a part hereof from the date of the filing of such reports and documents.
THE COMPANY HEREBY UNDERTAKES TO FURNISH WITHOUT CHARGE TO EACH PERSON
TO WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF SUCH
2
<PAGE>
PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS DESCRIBED ABOVE, OTHER THAN
EXHIBITS TO SUCH DOCUMENTS. REQUESTS SHOULD BE ADDRESSED TO HARRY KLETTER,
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER, INDUSTRIAL SERVICES OF
AMERICA, INC., 7100 GRADE LANE, P.O. BOX 32428, LOUISVILLE, KENTUCKY 40232.
THE TELEPHONE NUMBER IS (502) 368-1661.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus. See "Special Note
Regarding Forward-Looking Statements."
C. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements included in or incorporated by reference into this
Prospectus constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance, or
achievements expressed or implied by such forward-looking statements. Such
factors include, among other things, the following: the factors set forth in
this section; general and local economic conditions; and other factors
referenced in this Prospectus and in the Company's filings with the Commission.
D. RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS, THE
FOLLOWING RISK FACTORS SHOULD BE CONSIDERED CAREFULLY BEFORE PURCHASING THE
COMMON STOCK OFFERED HEREBY. THIS PROSPECTUS CONTAINS FORWARD-LOOKING STATEMENTS
WITHIN THE MEANING OF THE REFORM ACT. SUCH FORWARD-LOOKING STATEMENTS INVOLVE
KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE
ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY, OR INDUSTRY RESULTS,
TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE, OR ACHIEVEMENTS
EXPRESSED OR IMPLIED BY SUCH FORWARD- LOOKING STATEMENTS. SEE "SPECIAL NOTE
REGARDING FORWARD-LOOKING STATEMENTS." SUCH FACTORS INCLUDE, AMONG OTHERS, THE
RISK FACTORS SET FORTH BELOW.
1. Effect of Sales of Common Stock
Future sales of the Common Stock by existing shareholders, including
future sales by Optionees, or the perception that sales could occur, could
adversely affect the market price of the Common Stock. As of March 16, 1998, of
the Company's 1,929,600 outstanding shares of Common Stock, 42.62% of such
shares were beneficially owned directly or indirectly by Harry Kletter, who is
an "affiliate" of the Company under the federal securities laws. This does not
include (i) 200,000 shares of Common Stock beneficially owned by Roberta
Kletter, the spouse of Mr. Kletter, as to which shares he disclaims beneficial
ownership, and (ii) an option granting Mr. Kletter 500,000 shares of Common
Stock at an exercise price of $5.00 per share, which was ratified by the
Company's Board of Directors on February 16, 1998. The vesting schedule of the
option is as follows: (a) following July 1, 1998, the option to purchase 200,000
shares may be exercised; (b) following October 1, 1998 the option to purchase an
additional 200,000 shares may be exercised; (c) following January 1, 1999, the
option to purchase an additional 100,000 shares may be exercised. The options
expire on January 16, 2003. All other shares were freely transferrable without
restriction under the Securities Act, unless held by another "affiliate" of the
Company under the federal securities laws and except for 125,000 shares and
100,000 shares reserved for issuance under stock options granted to Sean M.
Garber and Glenn Bierman, respectively, and 100,000
3
<PAGE>
shares reserved for issuance under the Company's Employee Stock Option Plan, all
of which are "restricted securities" under the federal securities laws.
2. Business and Economic Factors
The future of the Company, and of the Company's operations, will be
subject to a number of business and other factors beyond management's control,
such as economic slowdowns and increased competition. Unfavorable general
economic conditions could adversely affect the operating results of the Company.
There can be no assurance that the Company would be able to sustain its
operations in the event of an economic slowdown for an extended period of time
or if general economic conditions in the U.S. deteriorate.
3. Competition
Each of the Company's current and proposed business segments is
characterized by competition. Many companies offer or are engaged in the
development of products or the provisions of services which may be or are
competitive with the Company's present or proposed products or services. Many of
these entities have substantially greater financial, technical, manufacturing,
marketing, distribution, and/or other resources than the Company. There can be
no assurance that the Company will be able to compete successfully with such
companies.
4. Absence of Dividends
The Company has not paid and does not anticipate paying any cash dividends
on its Common Stock in the foreseeable future, but instead intends to retain all
working capital and earnings, if any, for use in the Company's business
operations and in the expansion of its business.
5. No Assurance of Active or Continued Public Market.
Although a public trading market for the Common Stock currently exists,
there can be no assurance that such trading market will provide significant
liquidity with regard to the Common Stock or that such market will be sustained.
6. Control by Principal Shareholder.
As of March 16, 1998, Harry Kletter, Chairman of the Board, Chief
Executive Officer and a director of the Company, beneficially owned directly or
indirectly 822,304 shares of Common Stock, or 42.62% of the Company's issued and
outstanding Common Stock. This does not include (i) 200,000 shares of Common
Stock beneficially owned by Roberta Kletter, the spouse of Mr. Kletter, as to
which shares he disclaims beneficial ownership, and (ii) an option granting Mr.
Kletter 500,000 shares of Common Stock at an exercise price of $5.00 per share,
which was ratified by the Company's Board of Directors on February 16, 1998. The
vesting schedule of the option is as follows: (a) following July 1, 1998, the
option to purchase 200,000 shares may be exercised; (b) following October 1,
1998 the option to purchase an additional 200,000 shares may be exercised; (c)
following January 1, 1999, the option to purchase an additional 100,000 shares
may be exercised. The options expire on January 16, 2003. As a result of the
foregoing, Mr. Kletter will have the ability to influence the election of all of
the Company's directors and to direct the affairs of the Company.
E. THE COMPANY
The Company was incorporated under the laws of the State of Florida in
October, 1953, as Alson Manufacturing, Inc. The Company is an integrated solid
waste management consulting company engaged in the business of retail and
industrial waste management and waste handling equipment sales and service. The
Company's principal executive offices are located at 7100 Grade
4
<PAGE>
Lane, P.O. Box 32428, Louisville, Kentucky 40232 and its telephone number is
(502) 368-1661.
F. SELLING SHAREHOLDERS
Harry Kletter and each of Richard Bolton, Neil Sullivan, Joseph Turchyn
and Anthony Yonadi, who constitute all of the Optionees, entered into separate
Stock Option Agreements dated as of January 2, 1998 (the "Stock Option
Agreements"), pursuant to which Mr. Kletter granted the Options to Optionees.
Under the Stock Option Agreements, Optionees were granted the right, at their
option, to purchase up to an aggregate of 400,000 shares of the Common Stock of
the Company at a price of $4.00 per share. The Options granted to Messrs. Bolton
and Turchyn are exercisable in whole or in part at any time prior to January 2,
1999. The Options granted to Messrs. Sullivan and Yonadi are exercisable in
whole or in part at any time prior to February 1, 1999. Each Optionee agrees
that his Option shall not be assigned or otherwise transferred.
The Options may be exercised, in whole or in part, but in denominations
not less than one thousand (1,000) shares, at any time prior to 3:00 p.m.
Louisville, Kentucky time on the respective expiration dates referenced above,
by giving written notice to Mr. Kletter to that effect. If the notice of
exercise specifies a number of shares less than the full amount subject to the
applicable Option, and the time for exercise has not expired, the Company shall
provide the applicable Optionee with a new revised Stock Option Agreement for
the balance of the number of shares subject to such Option and then remaining
unexercised.
None of Optionees has had any position, office or other material
relationship with the Company or any of its predecessors or affiliates within
the past three years, except that on March 31, 1995, the Company and Neil
Sullivan, an Optionee, entered into certain agreements providing that Mr.
Sullivan would furnish professional consulting services to the Company for a
period of 24 months, and that the Company would (i) pay Mr. Sullivan 5% of the
aggregate price paid by the Company for acquisitions or other business
opportunities on which Mr. Sullivan provided services, (ii) reimburse Mr.
Sullivan for his business expenses, and (iii) grant to Mr. Sullivan an option to
purchase up to an aggregate of 100,000 shares of Common Stock of the Company at
a price of $2.00 per share, together with certain registration rights related
thereto. Mr. Sullivan also agreed to be bound by certain confidentiality and
noncompetition provisions. Subsequently such option and the underlying shares
were registered pursuant to a Registration Statement on Form S-8 and Mr.
Sullivan exercised such option and sold the underlying shares.
The following table sets forth as of March 16, 1998, with respect to each
Optionee: name, number of shares of Common Stock beneficially owned, number of
shares of Common Stock being offered and number of shares of Common Stock to be
held following the offering, assuming the sale of all of the shares of Common
Stock offered hereby.
5
<PAGE>
Owned To Be Owned
Before Offering After Offering
------------------------------ ------------------------------
Shares
Name Number (1) Percent (2) Offered Number Percent
Richard Bolton 50,000 2.15% 50,000 0 0
Neil Sullivan 150,000 6.44% 150,000 0 0
Joseph Turchyn 50,000 2.15% 50,000 0 0
Anthony Yonadi 150,000 6.44% 150,000 0 0
(1) Includes all shares of Common Stock subject to the Options.
(2) Calculated on the basis of 1,929,600 shares of Common Stock outstanding on
March 16, 1998 plus all shares of Common Stock subject to the Options.
G. PLAN OF DISTRIBUTION
The purpose of this Prospectus is to permit Optionees, if they desire, to
dispose of some or all of the Common Stock covered by this Prospectus at such
times and at such prices as they choose. Whether sales of shares will be made,
and the timing and amount of any sale made, is within the sole discretion of
Optionees. Optionees will in all cases be responsible for complying with the
prospectus delivery requirements of Section 5(b)(2) of the Securities Act in
connection with the offer and sale of the Common Stock covered by this
Prospectus.
Optionees may reoffer and resell all or a portion of their shares of
Common Stock from time to time as follows: (a) block trades in which the brokers
or dealers so engaged will attempt to sell shares as agent but may position and
resell a portion of the block as principal to facilitate the transaction; (b)
purchases by a broker or dealer as principal and resale by such broker or dealer
for its account pursuant to this Prospectus; (c) ordinary brokerage transactions
and transactions in which the broker solicits purchasers; and (d) in privately
negotiated transactions not involving a broker or dealer. In effecting sales,
brokers or dealers engaged to sell shares may arrange for other brokers or
dealers to participate. Brokers or dealers engaged to sell shares will receive
compensation in the form of commissions or discounts in amounts to be negotiated
by Optionee immediately prior to each sale. The Company will receive no proceeds
from any sales of Common Stock by Optionees. Optionees and the brokers and
dealers through whom sales of the shares are made may be deemed to be
"underwriters" within the meaning of the Securities Act, and any profits
realized by them on the sale of the shares may be considered to be underwriting
compensation.
Harry Kletter has agreed to pay all of the costs and expenses of this
offering up to $10,000 and each Optionee has agreed to pay his pro rata share of
such costs and expenses in excess thereof.
H. USE OF PROCEEDS
The Company will not receive any proceeds from the sale of any shares
issued upon exercise of the Options.
I. TRANSFER AGENT
The Transfer Agent for the shares of Common Stock is Mid-America Bank of
Louisville & Trust Company, Louisville, Kentucky (502) 562-5479.
6
<PAGE>
J. LEGAL MATTERS
Certain legal matters in connection with the securities offered hereby are
being passed upon for the Company by Stites & Harbison, 400 West Market Street,
Suite 1800, Louisville, Kentucky 40202-3352, counsel to the Company.
K. EXPERTS
The audited consolidated financial statements of the Company incorporated
by reference in this Prospectus have been so incorporated in reliance on the
report of Crowe, Chizek and Company, LLP, independent certified public
accountants, given on the authority of said firm as experts in auditing and
accounting.
L. STATEMENT ON INDEMNIFICATION
Under provisions of the Company's Amended and Restated Articles of
Incorporation, any person made a party to any lawsuit by reason of being a
director or officer of the Company, or any parent or subsidiary thereof, shall
be indemnified by the Company to the full extent authorized by the Florida
Business Corporation Act, other than in situations where such person shall be
adjudged to be liable for negligence or misconduct in the performance of duty.
The right of indemnification shall not extend to or include indemnification for
liabilities arising under the Securities Act.
7
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with the issuance and distribution of
the securities being registered are set forth in the following table. Harry
Kletter has agreed to pay all of the costs and expenses of this offering up to
$10,000 and each Optionee has agreed to pay his pro rata share of such costs and
expenses in excess thereof.
SEC Registration Fee . . . . . . . . . . . $ 694
Legal Fees and Expenses . . . . . . . . . 9,000 *
Accounting Fees and Expenses . . . . . . 1,000 *
Miscellaneous . . . . . . . . . . . . . . 250 *
Total. . . . . . . . . . . . . . . . $ 10,944
*Estimated
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Article XII of Registrant's Certificate of Amendment of Certificate of
Incorporation provides:
The corporation shall indemnify any and all of its directors or
officers or former directors or officers or any person who may have
served at its request as a director or officer of another
corporation in which it owns shares of capital stock or of which it
is a creditor against expenses actually and necessarily incurred by
them in connection with the defense of any action, suit or
proceeding in which they, or any of them, are made parties, or a
party by reason of being or having been directors or officers or a
director or officer of the corporation, or of such other
corporation, except in relation to matters as to which any such
director or officer or former director or officer or person shall be
adjudged in such action, suit or proceeding to be liable for
negligence or misconduct in the performance of duty. Such
indemnification shall not be deemed exclusive of any other rights to
which those indemnified may be entitled, under any by-laws,
agreement, vote of stockholders, or otherwise. The right of
indemnification hereinabove stated shall under no circumstances
extend to or include indemnification for liabilities arising under
the Securities Act of 1933, as amended.
b. Section 607.0850 of the Florida Business Corporation Act provides that:
(1) A corporation shall have power to indemnify any person who was
or is a party to any proceeding (other than an action by, or in the
right of, the corporation), by reason of the fact that he is or was
a director, officer, employee or agent of the corporation or is or
was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against liability incurred
in connection with such proceeding, including any appeal thereof, if
he acted in good faith and in a
II-1
<PAGE>
manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct
was unlawful. The termination of any proceeding by judgment, order,
settlement, or conviction or upon a plea of nolo contendere or its
equivalent shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which he reasonably
believed to be in, or not opposed to, the best interests of the
corporation or, with respect to any criminal action or proceeding,
had reasonable cause to believe that his conduct was unlawful.
(2) A corporation shall have power to indemnify any person, who was
or is a party to any proceeding by or in the right of the
corporation to procure a judgment in its favor by reason of the fact
that he is or was a director, officer, employee, or agent of the
corporation or is or was serving at the request of the corporation
as a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, against
expenses and amounts paid in settlement not exceeding, in the
judgment of the board of directors, the estimated expense of
litigating the proceeding to conclusion, actually and reasonably
incurred in connection with the defense or settlement of such
proceeding including any appeal thereof. Such indemnification shall
be authorized if such person acted in good faith and in a manner he
reasonably believed to be in, or not opposed, to the best interests
of the corporation, except that no indemnification shall be made
under this subsection in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable unless, and
only to the extent that, the court in which such proceeding was
brought, or any other court of competent jurisdiction, shall
determine upon application that, despite the adjudication of
liability but in view of all circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses
which such court shall deem proper.
(3) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in
defense of any proceeding referred to in subsection (1) or
subsection (2), or in defense of any claim, issue or matter therein,
he shall be indemnified against expenses actually and reasonably
incurred by him in connection therewith.
(4) Any indemnification under subsection (1) or subsection (2),
unless pursuant to a determination by a court, shall be made by the
corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer,
employee, or agent is proper in the circumstances because he has met
the applicable standard of conduct set forth in subsection (1) or
subsection (2). Such determination shall be made:
II-2
<PAGE>
(a) by the board of directors by a majority vote of a quorum
consisting of directors who were not parties to such proceeding;
(b) if such a quorum is not obtainable or, even if obtainable, by
majority vote of a committee duly designated by the board of
directors (in which directors who are parties may participate)
consisting solely of two or more directors not at the time parties
to the proceeding;
(c) By independent legal counsel;
1. Selected by the board of directors prescribed in
paragraph (a) or the committee prescribed in paragraph
(b); or
2. If a quorum of the directors cannot be obtained for paragraph (a)
and the committee cannot be designated under paragraph (b), selected
by majority vote of the full board of directors (in which directors
who are parties may participate) or
(d) By the shareholders by a majority vote of a quorum consisting of
shareholders who were not parties to such proceeding or, if no such
quorum is obtainable, by a majority vote of shareholders who were
not parties to such proceeding.
(5) Evaluation of the reasonableness of expenses and authorization
of indemnification shall be made in the same manner as the
determination that indemnification is permissible. However, if the
determination of permissibility is made by independent legal
counsel, persons specified by paragraph (4)(c) shall evaluate the
reasonableness of expenses and may authorize indemnification.
(6) Expenses incurred by an officer or director in defending a civil
or criminal proceeding may be paid by the corporation in advance of
the final disposition of such proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay
such amount if he is ultimately found not to be entitled to
indemnification by the corporation pursuant to this section.
Expenses incurred by other employees and agents may be paid in
advance upon such terms or conditions that the board of directors
deems appropriate.
(7) The indemnification and advancement of expenses provided
pursuant to this section are not exclusive, and a corporation may
make any other further indemnification or advancement of expense of
any of its directors, officers, employees, or agents, under any
bylaw, agreement, vote of shareholders or disinterested directors,
or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office. However,
indemnification or advancement of expenses shall not be made to or
on behalf of any director, officer, employee, or agent if a judgment
or other final adjudication establishes that his actions, or
II-3
<PAGE>
omissions to act, were material to the cause of action
so adjudicated and constitute:
(a) A violation of the criminal law, unless the director, officer,
employee, or agent had reasonable cause to believe his conduct was
lawful or had no reasonable cause to believe his conduct was
unlawful;
(b) A transaction from which the director, officer, employee, or
agent derived an improper personal benefit;
(c) In the case of a director, a circumstance under which the
liability provisions of s.607.0834 are applicable; or
(d) Willful misconduct or a conscious disregard for the best
interests of the corporation in a proceeding by or in the right of
the corporation to procure a judgment in its favor or in a
proceeding by or in the right of a shareholder.
(8) Indemnification and advancement of expenses as provided in this
section shall continue as, unless otherwise provided when authorized
or ratified, to a person who has ceased to be a director, officer,
employee, or agent and shall inure to the benefit of the heirs,
executors, and administrators of such a person, unless otherwise
provided when authorized or ratified.
(9) Unless the corporation's articles of incorporation provide
otherwise, notwithstanding the failure of a corporation to provide
indemnification, and despite any contrary determination of the board
or of the shareholders in the specific case, a director, officer,
employee, or agent of the corporation who is or was a party to a
proceeding may apply for indemnification or advancement of expenses,
or both, to the court conducting the proceeding, to the circuit
court, or to another court of competent jurisdiction. On receipt of
an application, the court, after giving any notice that it considers
necessary, may order indemnification and advancement of expenses,
including expenses incurred in seeking court-ordered indemnification
or advancement of expenses, if it determines that:
(a) The director, officer, employees, or agent is entitled to
mandatory indemnification under subsection (3), in which case the
court shall also order the corporation to pay the director
reasonable expenses incurred in obtaining court-ordered
indemnification or advancement of expenses;
(b) The director, officer, employee, or agent is entitled to
indemnification or advancement of expenses, or both, by virtue of
the exercise by the corporation of its power pursuant to subsection
(7); or
(c) The director, officer, employee, or agent is fairly and
reasonably entitled to indemnification or advancement of expenses,
or both, in view of all the
II-4
<PAGE>
relevant circumstances, regardless of whether such person met the
standard of conduct set forth in subsection (1), subsection (2), or
subsection (7).
(10) For purposes of this section, the term "corporation" includes,
in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in
a consolidation or merger, so that any person who is or was a
director, officer, employee, or agent of a constituent corporation,
or is or was serving at the request of a constituent corporation as
a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, is in the
same position under this section with respect to the resulting or
surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
(11) For purposes of this section: (a) the term "other enterprises"
includes employee benefit plans; (b) the term "expenses" includes
counsel fees, including those for appeal; (c) the term "liability"
includes obligations to pay a judgment, settlement, penalty, fine
(including an excise tax assessed with respect to any employee
benefit plan), and expenses actually and reasonably incurred with
respect to a proceeding; (d) the term "proceeding" includes any
threatened, pending, or completed action, suit, or other type of
proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal; (e) the term "agent"
includes a volunteer; (f) the term "serving at the request of the
corporation" includes any service as a director, officer, employee,
or agent of the corporation that imposes duties on such persons,
including duties relating to an employee benefit plan and its
participants or beneficiaries; and (g) the term "not opposed to the
best interest of the corporation" describes the actions of a person
who acts in good faith and in a manner he reasonably believes to be
in the best interests of the participants and beneficiaries of an
employee benefit plan.
(12) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee, or
agent of another corporation, partnership, joint venture, trust, or
other enterprise against any liability asserted against him and
incurred by him in any such capacity or arising out of his status as
such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of this
section.
Item 16. EXHIBITS.
The following documents are filed as Exhibits to this Registration Statement:
4.1 --Stock Option Agreement - Bolton
4.2 --Stock Option Agreement - Sullivan
II-5
<PAGE>
4.3 --Stock Option Agreement - Turchyn
4.4 --Stock Option Agreement - Yonadi
5.1 --Opinion of Stites & Harbison as to the validity of the shares being
registered, including consent.
23.1 --Consent of Stites & Harbison (included in Exhibit 5.1 hereto)
23.2 --Consent of Crowe, Chizek and Company, LLP
24.1 --Power of Attorney (Included on Page II-8)
Item 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933 (the "Act")
(ii) to reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post--
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the Registration Statement;
and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
Provided, however, that paragraphs (i) and (ii) shall not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 of Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Act, each such
post-effective amendment shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
(4) That, for the purposes of determining any liability under the Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Exchange Act that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described in Item 6 or otherwise, the Registrant has
been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or
II-6
<PAGE>
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3, and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Louisville, Commonwealth of Kentucky on the 22nd day
of April, 1998.
INDUSTRIAL SERVICES OF AMERICA, INC.
(Registrant)
By: ____________________________________
Harry Kletter,
Chairman of the Board and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated. Each person whose signature appears below hereby authorizes
Harry Kletter and Sean M. Garber, or either one of them, to execute in the name
of such person and to file any amendments to this Registration Statement as the
Registrant deems appropriate and appoints each such agent as attorney-in-fact to
sign in his behalf individually and in each capacity stated below and to file
any and all amendments and post-effective amendments to this Registration
Statement.
SIGNATURE TITLE DATE
/s/Harry Kletter
Harry Kletter Director, Chairman of April 22, 1998
the Board and Chief
Executive Officer
(Principal Executive
Officer and Principal
Financial Officer)
/s/ Sean M. Garber
Sean M. Garber Director, President, April 22, 1998
Chief Operating Officer
and Treasurer
/s/ Joseph H. Cohen
Joseph H. Cohen Director April 22, 1998
/s/ R. Michael Devereaux
R. Michael Devereaux Director April 22, 1998
/s/ Dr. Barry N. Naft
Dr. Barry N. Naft Director April 22, 1998
/s/ Marcia E. Terry
Marcia E. Terry Principal April 22, 1998
Accounting Officer
II-8
<PAGE>
INDEX TO EXHIBITS
Number Description
4.1 Stock Option Agreement - Bolton
4.2 Stock Option Agreement - Sullivan
4.3 Stock Option Agreement - Turchyn
4.4 Stock Option Agreement - Yonadi
5.1 Opinion of Stites & Harbison as to the validity of the shares being
registered, including consent.
23.1 Consent of Stites & Harbison (included in Exhibit 5.1 hereto)
23.2 Consent of Crowe, Chizek and Company, LLP
24.1 Power of Attorney (Included on Page II-8)
II-9
<PAGE>
4
EXHIBIT 4.1
THIS OPTION (AND SHARES COVERED THEREBY) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). IT MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE OPTION UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY
TO INDUSTRIAL SERVICES OF AMERICA, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
50,000 Shares Exercise Price: $4.00
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the "Agreement") made and effective as of the
2nd day of January, 1998 (the "Effective Date"), between HARRY KLETTER
("Kletter"), of 1208 Park Hills Court, Louisville, Kentucky 40207; and Richard
Bolton of Griffin Partners, Inc. located at 75 W. Front Street, Red Bank, New
Jersey 07701 ("Optionee").
WITNESSETH:
Kletter is a substantial shareholder of Industrial Services of America,
Inc., a Florida Corporation ("ISA"). Kletter and Optionee each desire to enter
into this Option Agreement containing the terms and conditions hereinafter set
forth, and which grants to Optionee an option to purchase certain shares of the
Common Stock of ISA owned by Kletter (the "Shares").
NOW, THEREFORE, in consideration of the promises and mutual agreements of
the parties herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. GRANT OF OPTION. In consideration of the foregoing, Kletter hereby
grants and issues to Optionee the right at his option (hereinafter referred to
as the "Option") to purchase up to an aggregate of 50,000 Shares of Common Stock
($.01 par value) of ISA at a price of $4.00 per share all of which Option shall
be exercisable, in whole or in part at any time prior to January 2, 1999 (the
"Expiration Date").
2. METHOD OF EXERCISING OPTION. The Option may be exercised, in whole or
in part at any time prior to 3:00 p.m., Louisville, Kentucky Time on the
Expiration date, by giving written notice to Kletter to that effect. The Option
evidenced hereby shall be exercisable by the delivery to and receipt by Kletter
of (a) this original Option Agreement and (b) a written Notice of Election to
Exercise (the "Notice of Election") in the form set forth on the Schedule 1 to
this Stock Option Agreement, attached hereto and incorporated herein by
reference, specifying the number of Shares to be purchased in not less than one
thousand (1,000) share denominations. If the Notice of Exercise is for less than
the total of 50,000 Shares, and the time for exercise has not expired, Kletter
shall provide Optionee with a new or revised Stock Option Agreement for the
balance of the Shares then remaining unexercised, upon the same terms and
conditions as provided herein.
3. KLETTER'S REPRESENTATION. Kletter represents that he will use his best
efforts to have the appropriate party prepare, file, and maintain with the
appropriate regulatory authorities any required statements and/or notices
regarding the shares of his Common Stock underlying the Option granted herein
within 45 days of the date hereof. Registration of stock to be complete in April
1998. All expenses up to the maximum sum of $10,000.00 associated with
statements and/or notices regarding this Option (and the underlying Shares) and
other Options (and such underlying shares) in the aggregate of 400,000 Shares
shall be borne by Kletter, and the prorated amount of expenses in excess thereof
with respect to the registration of a total of 400,000 Shares to be optioned
shall be paid by Optionee.
4. NOTICES. All notices required to be given by either party shall be in
writing and delivered by registered, certified or overnight express mail, return
receipt requested, to the party being noticed at the address set forth in the
first paragraph of this Stock Option Agreement. Either party may effect a change
in such address by a prior written notice.
5. BINDING ACCEPTANCE, PERSONAL NATURE OF OPTION, AND INDEMNIFICATION. By
acceptance of this signed Stock Option Agreement, Optionee does hereby agree to
be bound by all of the terms and conditions set forth herein. This Agreement
shall be binding upon the parties hereto and their respective heirs, personal
representatives and legal representatives. This Option is personal to Optionee
only, and shall not be assigned or otherwise transferred. Optionee agrees to and
shall indemnify and hold Kletter harmless from and against any loss, cost or
expense (including attorney's fees, reasonably incurred), arising, either
directly or indirectly, from any act or omission to act by the Optionee, which
results in a claim made upon Kletter regarding the Option or the Shares.
6. GOVERNING LAW. This Stock Option Agreement shall be construed under the
laws of the Commonwealth of Kentucky, without giving effect to the principles of
conflict of laws thereof.
7. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. This Stock Option
Agreement has been entered into in the Commonwealth of Kentucky and the
validity, interpretation and legal effect of this Stock Option Agreement will be
governed by the laws of the Commonwealth of Kentucky applicable to contracts
entered into within the Commonwealth of Kentucky. Any dispute under this Stock
Option Agreement shall be resolved by arbitration conducted in Louisville,
Kentucky by the American Arbitration Association. Any action or other proceeding
which involves such a controversy will be brought only in said jurisdiction, and
not elsewhere, and the parties hereto waive any objections on the grounds of
lack of jurisdiction, lack of venue, or forum non-conveniens or any similar
grounds. Any process including, without limitation, any summons or subpoena in
any such action or proceeding may, among other methods, be served upon either
party by delivering it or mailing it, by registered or certified mail, directed
to the address on page one of this Stock Option Agreement. Any such delivery or
mail service will be deemed to have the same force and effect as personal
service within the Commonwealth of Kentucky.
/s/Harry Kletter
HARRY KLETTER
Accepted By:
/s/Richard Bolton
"OPTIONEE"
<PAGE>
SCHEDULE 1 TO STOCK OPTION AGREEMENT
NOTICE OF ELECTION OF EXERCISE
TO: Harry Kletter
7100 Grade Lane
Louisville, Kentucky 40213
The Undersigned Purchaser hereby elects to purchase shares (the
"Shares") of the Common Stock ($.01
par value) of Industrial Services of America, Inc. ("ISA") pursuant to the terms
of the Stock Option Agreement (the "Option"), dated as of January 2nd, 1998, by
and between the undersigned and Harry Kletter (which Option must be surrendered
with this Notice of Election To Exercise). Kletter agrees that upon exercise of
option, the appropriate documentation to issue these shares will be sent to the
transfer agent within five (5) business days.
Payment in Full (U.S. Funds) is hereby tendered in the aggregate sum of $
which sum represents the Shares (maximum 50,000) times the per Share purchase
price of $4.00 by bank certified check payable to Kletter with such funds
immediately available in Louisville, Kentucky.
You are hereby requested to issue a certificate representing the Shares in
the name(s), and to the address(es) as specified below:
Name:
Number of Shares:
City:
Social Security or Tax I.D.
Number:
1. The Purchaser acknowledges the prior receipt and review of copies of
ISA's most recent Form 10-K, Form 10-Q, and Form 8-K filings with the United
States Securities and Exchange Commission. Purchaser further acknowledges being
fully aware of the "Risk Factors" regarding the purchase of ISA Shares as such
matters are and have been described in federal regulatory filings.
2. The Purchaser has sufficient knowledge and experience in financial and
business matters, including the purchase and ownership of unregistered corporate
securities and options, to be able to evaluate the risks and merits of the
investment represented by the Purchaser's exercise of the Option and purchase of
the Shares, and the Purchaser's net worth and available assets are such that
Purchaser is able to bear the economic risk of exercise of the Option and
purchase of the Shares.
3. The Purchaser acknowledges that the Purchaser has either been supplied
with or has had access to information to which a reasonable investor would
attach significance in making investment decisions, and has had the opportunity
to ask questions of and receive answers from knowledgeable individuals
concerning Kletter and ISA, so that, as a reasonable investor, Purchaser has
been able to make a decision to exercise the Option and purchase the Shares.
4. Because of the experience in financial and business matters of the
Purchaser, the Purchaser is qualified to make the inquiry and analysis described
in paragraph 2.
5. The Purchaser understands that neither the Option nor the Shares are
being registered under the Securities Act of 1933, as amended in reliance upon
exemptions thereunder for transactions not involving any public offering and are
not being registered or otherwise qualified for sale under the "Blue Sky" laws
and regulations of any state.
6. The Purchaser is exercising the Option and purchasing the Shares for
investment and not with a view to the sale or other distribution thereof, in
whole or in part.
DATE "PURCHASER"
4
<PAGE>
EXHIBIT 4.2
THIS OPTION (AND SHARES COVERED THEREBY) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). IT MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE OPTION UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY
TO INDUSTRIAL SERVICES OF AMERICA, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
150,000 Shares Exercise Price: $4.00
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the "Agreement") made and effective as of the
2nd day of January, 1998 (the "Effective Date"), between HARRY KLETTER
("Kletter"), of 1208 Park Hills Court, Louisville, Kentucky 40207; and Neil
Sullivan of 1901 Avenue of the Stars, 20th Floor, Los Angeles, California
90067-6021 ("Optionee").
WITNESSETH:
Kletter is a substantial shareholder of Industrial Services of America,
Inc., a Florida Corporation ("ISA"). Kletter and Optionee each desire to enter
into this Option Agreement containing the terms and conditions hereinafter set
forth, and which grants to Optionee an option to purchase certain shares of the
Common Stock of ISA owned by Kletter (the "Shares").
NOW, THEREFORE, in consideration of the promises and mutual agreements of
the parties herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. GRANT OF OPTION. In consideration of the foregoing, Kletter hereby
grants and issues to Optionee the right at his option (hereinafter referred to
as the "Option") to purchase up to an aggregate of 150,000 Shares of Common
Stock ($.01 par value) of ISA at a price of $4.00 per share all of which Option
shall be exercisable, in whole or in part at any time prior to February 1, 1999
(the "Expiration Date").
2. METHOD OF EXERCISING OPTION. The Option may be exercised, in whole or
in part at any time prior to 3:00 p.m., Louisville, Kentucky Time on the
Expiration date, by giving written notice to Kletter to that effect. The Option
evidenced hereby shall be exercisable by the delivery to and receipt by Kletter
of (a) this original Option Agreement and (b) a written Notice of Election to
Exercise (the "Notice of Election") in the form set forth on the Schedule 1 to
this Stock Option Agreement, attached hereto and incorporated herein by
reference, specifying the number of Shares to be purchased in not less than one
thousand (1,000) share denominations. If the Notice of Exercise is for less than
the total of 150,000 Shares, and the time for exercise has not expired, Kletter
shall provide Optionee with a new or revised Stock Option Agreement for the
balance of the Shares then remaining unexercised, upon the same terms and
conditions as provided herein.
3. KLETTER'S REPRESENTATION. Kletter represents that he will use his best
efforts to have the appropriate party prepare, file, and maintain with the
appropriate regulatory authorities any required statements and/or notices
regarding the shares of his Common Stock underlying the Option granted herein
within 90 days of the date hereof. Registration of stock to be complete in April
1998. All expenses up to the maximum sum of $10,000.00 associated with
statements and/or notices regarding this Option (and the underlying Shares) and
other Options (and such underlying shares) in the aggregate of 400,000 Shares
shall be borne by Kletter, and the prorated amount of expenses in excess thereof
with respect to the registration of a total of 400,000 Shares to be optioned
shall be paid by Optionee.
4. NOTICES. All notices required to be given by either party shall be in
writing and delivered by registered, certified or overnight express mail, return
receipt requested, to the party being noticed at the address set forth in the
first paragraph of this Stock Option Agreement. Either party may effect a change
in such address by a prior written notice.
5. BINDING ACCEPTANCE, PERSONAL NATURE OF OPTION, AND INDEMNIFICATION. By
acceptance of this signed Stock Option Agreement, Optionee does hereby agree to
be bound by all of the terms and conditions set forth herein. This Agreement
shall be binding upon the parties hereto and their respective heirs, personal
representatives and legal representatives, including, but not limited to the
fiduciary of the estate of Kletter in the event of Kletter's death. This Option
is personal to Optionee only, and shall not be assigned or otherwise
transferred. Optionee agrees to and shall indemnify and hold Kletter harmless
from and against any loss, cost or expense (including attorney's fees,
reasonably incurred), arising, either directly or indirectly, from any act or
omission to act by the Optionee, which results in a claim made upon Kletter
regarding the Option or the Shares.
6. GOVERNING LAW. This Stock Option Agreement shall be construed under the
laws of the Commonwealth of Kentucky, without giving effect to the principles of
conflict of laws thereof.
7. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. This Stock Option
Agreement has been entered into in the Commonwealth of Kentucky and the
validity, interpretation and legal effect of this Stock Option Agreement will be
governed by the laws of the Commonwealth of Kentucky applicable to contracts
entered into within the Commonwealth of Kentucky. Any dispute under this Stock
Option Agreement shall be resolved by arbitration conducted in Louisville,
Kentucky by the American Arbitration Association. Any action or other proceeding
which involves such a controversy will be brought only in said jurisdiction, and
not elsewhere, and the parties hereto waive any objections on the grounds of
lack of jurisdiction, lack of venue, or forum non-conveniens or any similar
grounds. Any process including, without limitation, any summons or subpoena in
any such action or proceeding may, among other methods, be served upon either
party by delivering it or mailing it, by registered or certified mail, directed
to the address on page one of this Stock Option Agreement. Any such delivery or
mail service will be deemed to have the same force and effect as personal
service within the Commonwealth of Kentucky.
/s/Harry Kletter
HARRY KLETTER
Accepted By:
/s/Neil Sullivan
"OPTIONEE"
<PAGE>
SCHEDULE 1 TO STOCK OPTION AGREEMENT
NOTICE OF ELECTION OF EXERCISE
TO: Harry Kletter
7100 Grade Lane
Louisville, Kentucky 40213
The Undersigned Purchaser hereby elects to purchase shares (the
"Shares") of the Common Stock ($.01
par value) of Industrial Services of America, Inc. ("ISA") pursuant to the terms
of the Stock Option Agreement (the "Option"), dated as of January 2nd, 1998, by
and between the undersigned and Harry Kletter (which Option must be surrendered
with this Notice of Election To Exercise). Kletter agrees that upon exercise of
option, the appropriate documentation to issue these shares will be sent to the
transfer agent within twenty-four (24) hours.
Payment in Full (U.S. Funds) is hereby tendered in the aggregate sum of $
which sum represents the Shares (maximum 150,000) times the per Share purchase
price of $4.00 by bank certified check payable to Kletter with such funds
immediately available in Louisville, Kentucky.
You are hereby requested to issue a certificate representing the Shares in
the name(s), and to the address(es) as specified below:
Name:
Street:
Number of Shares:
City:
State: Zip:
Social Security or Tax I.D.
Number:
1. The Purchaser acknowledges the prior receipt and review of copies of
ISA's most recent Form 10-K, Form 10-Q, and Form 8-K filings with the United
States Securities and Exchange Commission. Purchaser further acknowledges being
fully aware of the "Risk Factors" regarding the purchase of ISA Shares as such
matters are and have been described in federal regulatory filings.
2. The Purchaser has sufficient knowledge and experience in financial and
business matters, including the purchase and ownership of unregistered corporate
securities and options, to be able to evaluate the risks and merits of the
investment represented by the Purchaser's exercise of the Option and purchase of
the Shares, and the Purchaser's net worth and available assets are such that
Purchaser is able to bear the economic risk of exercise of the Option and
purchase of the Shares.
3. The Purchaser acknowledges that the Purchaser has either been supplied
with or has had access to information to which a reasonable investor would
attach significance in making investment decisions, and has had the opportunity
to ask questions of and receive answers from knowledgeable individuals
concerning Kletter and ISA, so that, as a reasonable investor, Purchaser has
been able to make a decision to exercise the Option and purchase the Shares.
4. Because of the experience in financial and business matters of the
Purchaser, the Purchaser is qualified to make the inquiry and analysis described
in paragraph 2.
5. The Purchaser understands that neither the Option nor the Shares are
being registered under the Securities Act of 1933, as amended in reliance upon
exemptions thereunder for transactions not involving any public offering and are
not being registered or otherwise qualified for sale under the "Blue Sky" laws
and regulations of any state.
6. The Purchaser is exercising the Option and purchasing the Shares for
investment and not with a view to the sale or other distribution thereof, in
whole or in part.
DATE "PURCHASER"
<PAGE>
4
EXHIBIT 4.3
THIS OPTION (AND SHARES COVERED THEREBY) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). IT MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE OPTION UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY
TO INDUSTRIAL SERVICES OF AMERICA, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
50,000 Shares Exercise Price: $4.00
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the "Agreement") made and effective as of the
2nd day of January, 1998 (the "Effective Date"), between HARRY KLETTER
("Kletter"), of 1208 Park Hills Court, Louisville, Kentucky 40207; and Joseph
Turchyn of Griffin Partners, Inc. located at 75 W. Front Street, Red Bank, New
Jersey 07701 ("Optionee").
WITNESSETH:
Kletter is a substantial shareholder of Industrial Services of America,
Inc., a Florida Corporation ("ISA"). Kletter and Optionee each desire to enter
into this Option Agreement containing the terms and conditions hereinafter set
forth, and which grants to Optionee an option to purchase certain shares of the
Common Stock of ISA owned by Kletter (the "Shares").
NOW, THEREFORE, in consideration of the promises and mutual agreements of
the parties herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. GRANT OF OPTION. In consideration of the foregoing, Kletter hereby
grants and issues to Optionee the right at his option (hereinafter referred to
as the "Option") to purchase up to an aggregate of 50,000 Shares of Common Stock
($.01 par value) of ISA at a price of $4.00 per share all of which Option shall
be exercisable, in whole or in part at any time prior to January 2, 1999 (the
"Expiration Date").
2. METHOD OF EXERCISING OPTION. The Option may be exercised, in whole or
in part at any time prior to 3:00 p.m., Louisville, Kentucky Time on the
Expiration date, by giving written notice to Kletter to that effect. The Option
evidenced hereby shall be exercisable by the delivery to and receipt by Kletter
of (a) this original Option Agreement and (b) a written Notice of Election to
Exercise (the "Notice of Election") in the form set forth on the Schedule 1 to
this Stock Option Agreement, attached hereto and incorporated herein by
reference, specifying the number of Shares to be purchased in not less than one
thousand (1,000) share denominations. If the Notice of Exercise is for less than
the total of 50,000 Shares, and the time for exercise has not expired, Kletter
shall provide Optionee with a new or revised Stock Option Agreement for the
balance of the Shares then remaining unexercised, upon the same terms and
conditions as provided herein.
3. KLETTER'S REPRESENTATION. Kletter represents that he will use his best
efforts to have the appropriate party prepare, file, and maintain with the
appropriate regulatory authorities any required statements and/or notices
regarding the shares of his Common Stock underlying the Option granted herein
within 45 days of the date hereof. Registration of stock to be complete in April
1998. All expenses up to the maximum sum of $10,000.00 associated with
statements and/or notices regarding this Option (and the underlying Shares) and
other Options (and such underlying shares) in the aggregate of 400,000 Shares
shall be borne by Kletter, and the prorated amount of expenses in excess thereof
with respect to the registration of a total of 400,000 Shares to be optioned
shall be paid by Optionee.
4. NOTICES. All notices required to be given by either party shall be in
writing and delivered by registered, certified or overnight express mail, return
receipt requested, to the party being noticed at the address set forth in the
first paragraph of this Stock Option Agreement. Either party may effect a change
in such address by a prior written notice.
5. BINDING ACCEPTANCE, PERSONAL NATURE OF OPTION, AND INDEMNIFICATION. By
acceptance of this signed Stock Option Agreement, Optionee does hereby agree to
be bound by all of the terms and conditions set forth herein. This Agreement
shall be binding upon the parties hereto and their respective heirs, personal
representatives and legal representatives. This Option is personal to Optionee
only, and shall not be assigned or otherwise transferred. Optionee agrees to and
shall indemnify and hold Kletter harmless from and against any loss, cost or
expense (including attorney's fees, reasonably incurred), arising, either
directly or indirectly, from any act or omission to act by the Optionee, which
results in a claim made upon Kletter regarding the Option or the Shares.
6. GOVERNING LAW. This Stock Option Agreement shall be construed under the
laws of the Commonwealth of Kentucky, without giving effect to the principles of
conflict of laws thereof.
7. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. This Stock Option
Agreement has been entered into in the Commonwealth of Kentucky and the
validity, interpretation and legal effect of this Stock Option Agreement will be
governed by the laws of the Commonwealth of Kentucky applicable to contracts
entered into within the Commonwealth of Kentucky. Any dispute under this Stock
Option Agreement shall be resolved by arbitration conducted in Louisville,
Kentucky by the American Arbitration Association. Any action or other proceeding
which involves such a controversy will be brought only in said jurisdiction, and
not elsewhere, and the parties hereto waive any objections on the grounds of
lack of jurisdiction, lack of venue, or forum non-conveniens or any similar
grounds. Any process including, without limitation, any summons or subpoena in
any such action or proceeding may, among other methods, be served upon either
party by delivering it or mailing it, by registered or certified mail, directed
to the address on page one of this Stock Option Agreement. Any such delivery or
mail service will be deemed to have the same force and effect as personal
service within the Commonwealth of Kentucky.
/s/ Harry Kletter
HARRY KLETTER
Accepted By:
/s/Joseph Turchyn
"OPTIONEE"
SCHEDULE 1 TO STOCK OPTION AGREEMENT
NOTICE OF ELECTION OF EXERCISE
TO: Harry Kletter
7100 Grade Lane
Louisville, Kentucky 40213
The Undersigned Purchaser hereby elects to purchase shares (the
"Shares") of the Common Stock ($.01
par value) of Industrial Services of America, Inc. ("ISA") pursuant to the terms
of the Stock Option Agreement (the "Option"), dated as of January 2nd, 1998, by
and between the undersigned and Harry Kletter (which Option must be surrendered
with this Notice of Election To Exercise). Kletter agrees that upon exercise of
option, the appropriate documentation to issue these shares will be sent to the
transfer agent within five (5) business days.
Payment in Full (U.S. Funds) is hereby tendered in the aggregate sum of $
which sum represents the Shares (maximum 50,000) times the per Share purchase
price of $4.00 by bank certified check payable to Kletter with such funds
immediately available in Louisville, Kentucky.
You are hereby requested to issue a certificate representing the Shares in
the name(s), and to the address(es) as specified below:
Name:
Street:
Number of Shares:
City:
State: Zip:
Social Security or Tax I.D.
Number:
1. The Purchaser acknowledges the prior receipt and review of copies of
ISA's most recent Form 10-K, Form 10-Q, and Form 8-K filings with the United
States Securities and Exchange Commission. Purchaser further acknowledges being
fully aware of the "Risk Factors" regarding the purchase of ISA Shares as such
matters are and have been described in federal regulatory filings.
2. The Purchaser has sufficient knowledge and experience in financial and
business matters, including the purchase and ownership of unregistered corporate
securities and options, to be able to evaluate the risks and merits of the
investment represented by the Purchaser's exercise of the Option and purchase of
the Shares, and the Purchaser's net worth and available assets are such that
Purchaser is able to bear the economic risk of exercise of the Option and
purchase of the Shares.
3. The Purchaser acknowledges that the Purchaser has either been supplied
with or has had access to information to which a reasonable investor would
attach significance in making investment decisions, and has had the opportunity
to ask questions of and receive answers from knowledgeable individuals
concerning Kletter and ISA, so that, as a reasonable investor, Purchaser has
been able to make a decision to exercise the Option and purchase the Shares.
4. Because of the experience in financial and business matters of the
Purchaser, the Purchaser is qualified to make the inquiry and analysis described
in paragraph 2.
5. The Purchaser understands that neither the Option nor the Shares are
being registered under the Securities Act of 1933, as amended in reliance upon
exemptions thereunder for transactions not involving any public offering and are
not being registered or otherwise qualified for sale under the "Blue Sky" laws
and regulations of any state.
6. The Purchaser is exercising the Option and purchasing the Shares for
investment and not with a view to the sale or other distribution thereof, in
whole or in part.
DATE "PURCHASER"
<PAGE>
4
EXHIBIT 4.4
THIS OPTION (AND SHARES COVERED THEREBY) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). IT MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE OPTION UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY
TO INDUSTRIAL SERVICES OF AMERICA, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.
150,000 Shares Exercise Price: $4.00
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (the "Agreement") made and effective as of the
2nd day of January, 1998 (the "Effective Date"), between HARRY KLETTER
("Kletter"), of 1208 Park Hills Court, Louisville, Kentucky 40207; and Anthony
Yonadi of 4832 N.W. 25 Way, Boca Raton, Florida 33434 ("Optionee").
WITNESSETH:
Kletter is a substantial shareholder of Industrial Services of America,
Inc., a Florida Corporation ("ISA"). Kletter and Optionee each desire to enter
into this Option Agreement containing the terms and conditions hereinafter set
forth, and which grants to Optionee an option to purchase certain shares of the
Common Stock of ISA owned by Kletter (the "Shares").
NOW, THEREFORE, in consideration of the promises and mutual agreements of
the parties herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. GRANT OF OPTION. In consideration of the foregoing, Kletter hereby
grants and issues to Optionee the right at his option (hereinafter referred to
as the "Option") to purchase up to an aggregate of 150,000 Shares of Common
Stock ($.01 par value) of ISA at a price of $4.00 per share all of which Option
shall be exercisable, in whole or in part at any time prior to February 1, 1999
(the "Expiration Date").
2. METHOD OF EXERCISING OPTION. The Option may be exercised, in whole or
in part at any time prior to 3:00 p.m., Louisville, Kentucky Time on the
Expiration date, by giving written notice to Kletter to that effect. The Option
evidenced hereby shall be exercisable by the delivery to and receipt by Kletter
of (a) this original Option Agreement and (b) a written Notice of Election to
Exercise (the "Notice of Election") in the form set forth on the Schedule 1 to
this Stock Option Agreement, attached hereto and incorporated herein by
reference, specifying the number of Shares to be purchased in not less than one
thousand (1,000) share denominations. If the Notice of Exercise is for less than
the total of 150,000 Shares, and the time for exercise has not expired, Kletter
shall provide Optionee with a new or revised Stock Option Agreement for the
balance of the Shares then remaining unexercised, upon the same terms and
conditions as provided herein.
3. KLETTER'S REPRESENTATION. Kletter represents that he will use his best
efforts to have the appropriate party prepare, file, and maintain with the
appropriate regulatory authorities any required statements and/or notices
regarding the shares of his Common Stock underlying the Option granted herein
within 90 days (April 2, 1998) of the date hereof. All expenses up to the
maximum sum of $10,000.00 associated with statements and/or notices regarding
this Option (and the underlying Shares) and other Options (and such underlying
shares) in the aggregate of 400,000 Shares shall be borne by Kletter, and the
prorated amount of expenses in excess thereof with respect to the registration
of a total of 400,000 Shares to be optioned shall be paid by Optionee.
4. NOTICES. All notices required to be given by either party shall be in
writing and delivered by registered, certified or overnight express mail, return
receipt requested, to the party being noticed at the address set forth in the
first paragraph of this Stock Option Agreement. Either party may effect a change
in such address by a prior written notice.
5. BINDING ACCEPTANCE, PERSONAL NATURE OF OPTION, AND INDEMNIFICATION. By
acceptance of this signed Stock Option Agreement, Optionee does hereby agree to
be bound by all of the terms and conditions set forth herein. This Agreement
shall be binding upon the parties hereto and their respective heirs, personal
representatives and legal representatives, including, but not limited to the
fiduciary of the estate of Kletter in the event of Kletter's death. This Option
is personal to Optionee only, and shall not be assigned or otherwise
transferred. Optionee agrees to and shall indemnify and hold Kletter harmless
from and against any loss, cost or expense (including attorney's fees,
reasonably incurred), arising, either directly or indirectly, from any act or
omission to act by the Optionee, which results in a claim made upon Kletter
regarding the Option or the Shares.
6. GOVERNING LAW. This Stock Option Agreement shall be construed under the
laws of the Commonwealth of Kentucky, without giving effect to the principles of
conflict of laws thereof.
7. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. This Stock Option
Agreement has been entered into in the Commonwealth of Kentucky and the
validity, interpretation and legal effect of this Stock Option Agreement will be
governed by the laws of the Commonwealth of Kentucky applicable to contracts
entered into within the Commonwealth of Kentucky. Any dispute under this Stock
Option Agreement shall be resolved by arbitration conducted in Louisville,
Kentucky by the American Arbitration Association. Any action or other proceeding
which involves such a controversy will be brought only in said jurisdiction, and
not elsewhere, and the parties hereto waive any objections on the grounds of
lack of jurisdiction, lack of venue, or forum non-conveniens or any similar
grounds. Any process including, without limitation, any summons or subpoena in
any such action or proceeding may, among other methods, be served upon either
party by delivering it or mailing it, by registered or certified mail, directed
to the address on page one of this Stock Option Agreement. Any such delivery or
mail service will be deemed to have the same force and effect as personal
service within the Commonwealth of Kentucky.
/s/Harry Kletter
HARRY KLETTER
Accepted By:
/s/Anthony Yonadi
"OPTIONEE"
<PAGE>
SCHEDULE 1 TO STOCK OPTION AGREEMENT
NOTICE OF ELECTION OF EXERCISE
TO: Harry Kletter
7100 Grade Lane
Louisville, Kentucky 40213
The Undersigned Purchaser hereby elects to purchase shares (the
"Shares") of the Common Stock ($.01
par value) of Industrial Services of America, Inc. ("ISA") pursuant to the terms
of the Stock Option Agreement (the "Option"), dated as of January 2nd, 1998, by
and between the undersigned and Harry Kletter (which Option must be surrendered
with this Notice of Election To Exercise). Kletter agrees that upon exercise of
option, the appropriate documentation to issue these shares will be sent to the
transfer agent within twenty-four (24) hours.
Payment in Full (U.S. Funds) is hereby tendered in the aggregate sum of $
which sum represents the Shares (maximum 150,000) times the per Share purchase
price of $4.00 by bank certified check payable to Kletter with such funds
immediately available in Louisville, Kentucky.
You are hereby requested to issue a certificate representing the Shares in
the name(s), and to the address(es) as specified below:
Name:
Street:
Number of Shares:
City:
State: Zip:
Social Security or Tax I.D.
Number:
1. The Purchaser acknowledges the prior receipt and review of copies of
ISA's most recent Form 10-K, Form 10-Q, and Form 8-K filings with the United
States Securities and Exchange Commission. Purchaser further acknowledges being
fully aware of the "Risk Factors" regarding the purchase of ISA Shares as such
matters are and have been described in federal regulatory filings.
2. The Purchaser has sufficient knowledge and experience in financial and
business matters, including the purchase and ownership of unregistered corporate
securities and options, to be able to evaluate the risks and merits of the
investment represented by the Purchaser's exercise of the Option and purchase of
the Shares, and the Purchaser's net worth and available assets are such that
Purchaser is able to bear the economic risk of exercise of the Option and
purchase of the Shares.
3. The Purchaser acknowledges that the Purchaser has either been supplied
with or has had access to information to which a reasonable investor would
attach significance in making investment decisions, and has had the opportunity
to ask questions of and receive answers from knowledgeable individuals
concerning Kletter and ISA, so that, as a reasonable investor, Purchaser has
been able to make a decision to exercise the Option and purchase the Shares.
4. Because of the experience in financial and business matters of the
Purchaser, the Purchaser is qualified to make the inquiry and analysis described
in paragraph 2.
5. The Purchaser understands that neither the Option nor the Shares are
being registered under the Securities Act of 1933, as amended in reliance upon
exemptions thereunder for transactions not involving any public offering and are
not being registered or otherwise qualified for sale under the "Blue Sky" laws
and regulations of any state.
6. The Purchaser is exercising the Option and purchasing the Shares for
investment and not with a view to the sale or other distribution thereof, in
whole or in part.
DATE "PURCHASER"
<PAGE>
EXHIBIT 23.1
__________, 1998
Industrial Services of America, Inc.
7100 Grade Lane
P.O. Box 32428
Louisville, Kentucky 40232
Re: 400,000 Shares of Industrial Services of America, Inc.,
a Florida corporation, $.01 Par Value Common Stock to
be registered on a Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel for Industrial Services of America, Inc. (the
"Company"), a Florida corporation, in connection with the preparation and filing
of a registration statement on Form S- 3 (the "Registration Statement"),
relating to the registration under the Securities Act of 1933, as amended (the
"Act"), of 400,000 shares of the Company's common stock, $.01 par value per
share (the "Common Stock"), owned by Harry Kletter and subject to options
granted by Harry Kletter to Richard Bolton, Neil Sullivan, Joseph Turchyn, and
Anthony Yonadi.
In connection with this opinion, we have considered such matters of law
and examined the originals or copies, certified or otherwise identified to our
satisfaction, of such documents and corporate and other records and have
obtained such certificates, letters, representations and information from the
officers, directors and employees of the Company and from others as we have
deemed necessary or appropriate to enable us to render the opinions expressed
herein.
Based upon and in reliance upon the foregoing, and subject to the
qualifications and assumptions set forth below, it is our opinion that, when (a)
the Registration Statement has become effective in accordance with the Act and
the rules and regulations thereunder and the provisions of such state securities
or "blue sky" laws as may be applicable have been
96825:Lou3
<PAGE>
complied with, and (b) the Common Stock has been duly delivered against payment
therefor, the Common Stock will be legally issued, fully paid and nonassessable.
Our opinion is limited by and subject to the following:
(a) In rendering our opinion we have assumed that, at the time of the
issuance and sale of the Common Stock, the Company will be a corporation validly
existing and in good standing under the laws of the State of Florida.
(b) In our examination of all documents, certificates and records, we have
assumed without investigation the authenticity and completeness of all documents
submitted to us as originals, the conformity to the originals of all documents
submitted to us as copies and the authenticity and completeness of the originals
of all documents submitted to us as copies. We have also assumed the genuineness
of all signatures, the legal capacity of natural persons, the authority of all
persons executing documents on behalf of the parties thereto other than the
Company, and the due authorization, execution and delivery of all documents by
the parties thereto other than the Company.
(c) Our opinion is based solely on and limited to the Florida Business
Corporation Act and the federal laws of the United States of America. We express
no opinion as to the laws of any other jurisdiction.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
96825:Lou3
<PAGE>
<PAGE>
EXHIBIT 23.2
Consent of Independent Auditors
Board of Directors
Industrial Services of America, Inc.
We consent to the inclusion in the Registration Statement on Form S-3, to be
filed by Industrial Services of America, Inc., of our report dated February 28,
1998 on the financial statements of Industrial Services of America, Inc. as of
December 31, 1997, and for the years then ended, appearing in the Prospectus,
which is part of the Registration Statement. We also consent to the use of our
name under the heading "Experts" in the Prospectus.
/s/ Crowe, Chizek and Company LLP
Crowe, Chizek and Company LLP
Indianapolis, Indiana
April 17, 1998
