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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)*
MARIETTA CORPORATION
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
(Title of Class of Securities)
567634100
(CUSIP Number)
Barry Florescue Charles I. Weissman
701 Southeast 6th Avenue, Suite 204 Shereff, Friedman, Hoffman & Goodman , LLP
Delray Beach, Florida 33483 919 Third Avenue
(407) 272-7746 New York, New York 10022
(212) 758-9500
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 18, 1995
(Date of Event which Requires 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 / /
Check the following box if a fee is being paid with the statement / /. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such
class.) (See Rule 13d-7.)
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.
*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 ("Act") 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. 567634100 Page ____ of ____ Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Barry W. Florescue
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
/ /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7 SOLE VOTING POWER
NUMBER OF 314,365
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 314,365
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
314,365
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.7%
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION
<PAGE>
SCHEDULE 13D
CUSIP No. 567634100 Page____ of ____ Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
286 Bridge Street, Inc.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
/ /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Colorado
7 SOLE VOTING POWER
NUMBER OF 129,900
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 129,900
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
129,900
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.6%
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION
<PAGE>
SCHEDULE 13D
CUSIP No. 567634100 Page ____ of ____ Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Florescue Family Corporation
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
/ /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Nevada
7 SOLE VOTING POWER
NUMBER OF 161,965
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 161,965
WITH
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
161,965
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* / /
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.5%
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION
Schedule 13D Amendment No. 4
Marietta Corporation
This Amendment No. 4 to the statement on Schedule 13D (as defined below)
restates, amends and supplements the statement on Schedule 13D dated September
26, 1994, as amended by Amendment No. 1 thereto dated November 2, 1994,
Amendment No. 2 thereto dated January 20, 1995, Amendment No. 3 thereto dated
March 7, 1995 (together, the "Schedule 13D") by Barry W. Florescue, 286 Bridge
Street, Inc. ("286 Bridge Street") and Florescue Family Corporation ("FFC", and
collectively with Mr. Florescue and 286 Bridge Street, the "Reporting Persons"),
relating to the Common Stock (as defined below) of Marietta Corporation.
Item 1 Security and Issuer
This statement on Schedule 13D relates to the common stock, $.01 par
value per share (the "Common Stock"), of Marietta Corporation (the "Issuer"),
having its principal executive office at 3700 Huntington Street, Cortland, New
York 13045.
Item 2 Identity and Background
(a) This Schedule 13D is being filed jointly for Barry W. Florescue,
286 Bridge Street, Inc. ("286 Bridge Street") and Florescue Family Corporation
("FFC", and collectively with Mr. Florescue and 286 Bridge Street, the
"Reporting Persons").
(b) The principal address and/or office of each of the Reporting
Persons is 701 Southeast Sixth Avenue, Delray Beach, Florida 33483.
(c) and (f). Mr. Florescue's principal employment is as the Chief
Executive Officer of Century Financial Group, Inc. The principal office of
Century Financial Group, Inc. is 701 Southeast Sixth Avenue, Delray Beach,
Florida 33483. Mr. Florescue is a United States citizen.
286 Bridge Street is a Colorado corporation. The principal business of
286 Bridge Street is investing in real estate and other assets. Mr. Florescue
is the President of 286 Bridge Street and is the majority stockholder of 286
Bridge Street.
FFC is a Nevada corporation. The principal business of FFC is investing
in securities and other assets. Mr. Florescue is the President of FFC and is
the majority stockholder of FFC.
(d) and (e). During the past five years, none of the Reporting Persons
has been convicted in any criminal proceeding (excluding traffic violations or
similar misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, prohibiting or mandating activities subject to, federal or
state
<PAGE>
securities laws or finding any violation with respect to such laws.
Item 3 Source and Amount of Funds
Item 3 of the Schedule 13D is hereby amended to read in its entirety as
follows:
The source of the funds used by Mr. Florescue to purchase the securities
of the Issuer was personal funds. The source of the funds used by 286 Bridge
Street to purchase the securities of the Issuer was the assets of the
corporation, including the proceeds of unsecured stockholder loans. The source
of the funds used by FFC to purchase the securities of the Issuer was the assets
of the corporation, including the proceeds of unsecured stockholder loans.
The amount of funds used by the Reporting Persons to purchase the
314,165 shares of Common Stock owned by them is as follows:
Mr. Florescue $ 178,164.69
286 Bridge Street $1,093,465.29
FFC $1,350,111.76
The Reporting Persons acquired an aggregate of 291,865 of such shares for an
aggregate purchase price of $2,443,585.55 of which an aggregate of $1,221,792.78
was provided by customary margin loans. Mr. Florescue purchased the shares he
owns directly through Wolff Investments and Bridge Trading Company. 286 Bridge
Street purchased its shares of Common Stock through R.M. Stark & Co. FFC
purchased its shares of Common Stock through Adler, Coleman & Co., Inc. (which
were transferred to R.M. Stark & Co.), Ladenburg, Thalmann Co. Inc. and Wolff
Investments.
Item 4 Purpose of the Transaction
Item 4 of the Schedule 13D is hereby amended to read in its entirety as
follows:
Each of the Reporting Persons acquired its respective shares of Common
Stock for investment purposes. Each of the Reporting Persons may acquire or
dispose of securities of the Issuer, including shares of Common Stock, directly
or indirectly, in open-market or privately negotiated transactions, depending
upon the evaluation of the performance and prospects of the Issuer by the
Reporting Persons, and upon other developments and circumstances, including, but
not limited to, general economic and business conditions and stock market
conditions.
On March 7, 1995 Mr. Florescue, as President of FFC, forwarded a letter
to the Board of Directors of the Issuer which is attached hereto as Exhibit E
and incorporated herein by reference.
On May 18, 1995 Mr. Florescue, as President of FFC, and the Issuer
executed a confidentiality agreement which is attached hereto as Exhibit F and
incorporated herein by reference.
-2-
<PAGE>
On May 23, 1995 Mr. Florescue, as President of FFC, and Dabney Resnick,
Inc. ("D/R") executed a letter attached hereto as Exhibit G and incorporated
herein by reference.
Except for the foregoing and as disclosed below, no Reporting Person has
any present plans or proposals which relate to or would result in any of the
actions or events described in paragraphs (a) through (j) of Item 4 of Schedule
13D.
Item 5 Interest in Securities of the Issuer
Item 5 of the Schedule 13D is hereby amended to read in its entirety as
follows:
(a) Mr. Florescue is the beneficial owner of 314,365 shares (8.7%) of
Common Stock.
286 Bridge Street is the beneficial owner of 129,900 shares (3.6%) of
Common Stock. Mr. Florescue, as the President and majority stockholder of 286
Bridge Street, has the power to direct the voting and disposition of the
investments of 286 Bridge Street, including the shares of Common Stock, and
accordingly, may be deemed the beneficial owner of any shares of Common Stock
owned by 286 Bridge Street by virtue of Rule 13d-3 under the Securities Exchange
Act of 1934, as amended ("Rule 13d-3").
FFC is the beneficial owner of 161,965 shares (4.5%) of Common Stock.
Mr. Florescue, as the President and majority stockholder of FFC, has the power
to direct the voting and disposition of the investments of FFC, including the
shares of Common Stock, and accordingly, may be deemed the beneficial owner of
any shares of Common Stock owned by FFC by virtue of Rule 13d-3.
The number of shares of Common Stock beneficially owned by each of the
Reporting Persons and the percentage of outstanding shares represented thereby
have been computed in accordance with Rule 13d-3. The percentage of shares of
Common Stock beneficially owned by the Reporting Persons has been calculated
based on 3,596,049 shares of Common Stock reported to be outstanding as of April
28, 1995 in the Issuer's Quarterly Report of Form 10-Q for the quarter ended
April 1, 1995.
(b) 286 Bridge Street has the sole power (i) to vote or to direct the
voting of and (ii) to dispose or to direct the disposition of the 129,900 shares
of Common Stock beneficially owned by it. Mr. Florescue, as the President and
majority stockholder of 286 Bridge Street, has the power to direct the voting
and disposition of the investments of 286 Bridge Street, including the shares of
Common Stock.
FFC has the sole power (i) to vote or to direct the voting of and (ii)
to dispose or to direct the disposition of the 161,965 shares of Common Stock
beneficially owned by it. Mr. Florescue, as the President and majority
stockholder of FFC, has the power to direct the voting and disposition of the
investments of FFC, including the shares of Common Stock.
-3-
<PAGE>
Mr. Florescue has the sole power (i) to vote or to direct the voting of
and (ii) to dispose or to direct the disposition of the 314,365 shares of Common
Stock beneficially owned by him. Of the 314,365 shares of Common Stock
beneficially owned by Mr. Florescue, 22,500 shares of Common Stock are owned by
him directly and 129,900 and 161,965 shares of Common Stock, respectively, are
owned by 286 Bridge Street and FFC.
(c) All transactions in the Common Stock which have been effected by
the Reporting Persons during the past sixty days are set forth in Annex A hereto
and are incorporated herein by reference. Each of the transactions was effected
on the open market.
(d) Not applicable.
(e) Not applicable.
Item 6 Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer
Except as provided in the letter executed by FFC and D/R on May 23,
1995, which is attached hereto as Exhibit G and incorporated herein by
reference, there are no contracts, arrangements, understandings or relationships
(legal or otherwise) among the Reporting Persons and between the Reporting
Persons and any person with respect to any securities of the Issuer, including
but not limited to transfer or voting of any of the securities, finder's fees,
joint ventures, loan or option arrangements, put or calls, guarantees or
profits, division of profits or loss, or the giving or withholding of proxies.
Item 7 Material to be Filed as Exhibits
Exhibit A. Customer Agreement, dated April 7, 1994, between Ernst &
Company and Mr. Florescue.
Exhibit B. Customer Account Agreement and Disclosure Document, dated
August 8, 1994, between Kemper Clearing Corp. and 286 Bridge
Street.
Exhibit C. Client Agreement, effective as of August 22, 1992, between
Ladenburg, Thalmann & Co. Inc. and FFC.
Exhibit D. Customer Agreement, dated January 13, 1993, between Adler,
Coleman & Co., Inc. and FFC.
Exhibit E. Letter dated March 7, 1995 to the Board of Directors of the
Issuer.
-4-
<PAGE>
Exhibit F. Confidentiality Agreement, dated May 17, 1995, between FFC
and the Company.
Exhibit G. Letter, dated May 22, 1995, between FFC and D/R.
-5-
<PAGE>
Signature
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: May 25, 1995
/s/ Barry W. Florescue
BARRY W. FLORESCUE
286 BRIDGE STREET, INC.
By: /s/ Barry W. Florescue
Name: Barry W. Florescue
Title: President
FLORESCUE FAMILY CORPORATION
By: /s/ Barry W. Florescue
Name: Barry W. Florescue
Title: President
-6-
<PAGE>
ANNEX A
Number of Price
Reporting Person Date of Transaction Shares Acquired per Share
- ---------------- ------------------- --------------- ---------
286 Bridge Street 5/12/95 200 11.02
-7-
EXHIBIT A
[LETTERHEAD OF ERNST & COMPANY]
CUSTOMER AGREEMENT
In consideration for you (the "Broker") opening or maintaining one or more
accounts (the "Account") for the undersigned (the "Customer"), the Customer
agrees to the terms and conditions contained in this Agreement. The heading
of each provision of this Agreement is for descriptive purposes only and
shall not be deemed to modify or qualify any of the rights or obligations
set forth in each such provision. For purposes of this Agreement,
"securities and other property" means, but is not limited to, money,
securities, financial instruments and commodities of every kind and nature
and related contracts and options, except that the provisions of paragraph
21 herein (the arbitration clause) shall not apply to commodities accounts.
This definition includes securities or other property currently or
hereafter held, carried or maintained by you or by any of your affiliates,
in your possession or control, or in the possession or control of any such
affiliate, for any purpose, in and for any of my accounts now or hereafter
opened, including any account in which I may have an interest.
1. Applicable Rules and Regulations
All transactions in the Customer's Account shall be subject to the
constitution, rules, regulations, customs and usages of the exchange or
market, and its clearing house, if any, where the transactions are executed
by the Broker or its agents, including its subsidiaries and affiliates.
Also, where applicable, the transactions shall be subject (a) to the
provisions of (1) the Securities Exchange Act of 1934, as amended, and (2)
the Commodities Exchange Act, as amended; and (b) to the rules and
regulations of (1) the Securities Exchange Commission, (2) the Board of
Governors of the Federal Reserve System and (3) the Commodities Futures
Trading Commission.
2. Agreement Contains Entire Understanding/Assignment
This Agreement contains the entire understanding between the Customer and
the Broker concerning the subject matter of this Agreement. Customer may
not assign the rights and obligations hereunder without first obtaining the
prior written consent of the Broker.
3. Severability
If any provision of this Agreement is held to be invalid, void or
unenforceable by reason of any law, rule, administrative order or judicial
decision, that determination shall not affect the validity of the remaining
provisions of this Agreement.
4. Waiver
Except as specifically permitted in this Agreement, no provision of this
Agreement can be, nor be deemed to be, waived, altered, modified or
amended unless such is agreed to in a writing signed by the Broker.
5. Delivery of Securities
Without abrogating any of the Broker's rights under any other portion of
this Agreement and subject to any indebtedness of the Customer to the
Broker, the Customer is entitled, upon appropriate demand, to receive
physical delivery of fully paid securities in the Customer's Account.
6. Liens
All securities and other property of the Customer in any account in which
the Customer has an interest shall be subject to a lien for the discharge
of any and all indebtedness or any other obligation of the Customer to the
Broker. All securities and other property of the Customer shall be held by
the Broker as security for the payment of any such obligations or
indebtedness to the Broker in any account that the Customer may have an
interest, and the Broker subject to applicable law may, at any time and
without prior notice to the Customer, use and/or transfer any or all
securities and other property interchangeably in any account(s) in which
the Customer has an interest (except regulated commodity accounts).
7. Pledge of Securities and Other Property
Within the limitations imposed by applicable laws, rules and regulations,
all securities and other property of the Customer may be pledged and
repledged and hypothecated and rehypothecated by the Broker from time to
time, without notice to the Customer, either separately or in common with
such other securities and other property of other bona fide Customers of
the Broker, for any amount due to the Broker in the Customer's Account(s).
The Broker may do so without retaining in its possession or under its
control for delivery a like amount of similar securities or other property.
8. Interest
Debit balances of the Account(s) of the Customer shall be charged with
interest in accordance with the Broker's established custom, as disclosed
to the Customer pursuant to the provisions of Rule 10b-16 of the Securities
Exchange Act.
9. DISCLOSURES REGARDING LIQUIDATIONS AND COVERING POSITIONS
THE CUSTOMER SHOULD CLEARLY UNDERSTAND THAT NOTWITHSTANDING A GENERAL
POLICY OF GIVING CUSTOMERS NOTICE OF A MARGIN DEFICIENCY, THE BROKER IS NOT
OBLIGATED TO REQUEST ADDITIONAL MARGIN FROM THE CUSTOMER IN THE EVENT THE
CUSTOMER'S ACCOUNT FALLS BELOW MINIMUM MAINTENANCE REQUIREMENTS. MORE
IMPORTANTLY, THERE MAY WELL BE CIRCUMSTANCES WHERE THE BROKER WILL
LIQUIDATE SECURITIES AND/OR OTHER PROPERTY IN THE ACCOUNT WITHOUT NOTICE TO
THE CUSTOMER TO ENSURE THAT MINIMUM MAINTENANCE REQUIREMENTS ARE SATISFIED.
<PAGE>
10. LIQUIDATIONS AND COVERING POSITIONS
THE BROKER SHALL HAVE THE RIGHT IN ACCORDANCE WITH ITS GENERAL POLICIES
REGARDING MARGIN MAINTENANCE REQUIREMENTS TO REQUIRE ADDITIONAL COLLATERAL
OR THE LIQUIDATION OF ANY SECURITIES AND OTHER PROPERTY WHENEVER IN
BROKER'S DISCRETION IT CONSIDERS IT NECESSARY FOR ITS PROTECTION INCLUDING
IN THE EVENT OF, BUT NOT LIMITED TO: THE FAILURE OF THE CUSTOMER TO
PROMPTLY MEET ANY CALL FOR ADDITIONAL COLLATERAL; THE FILING OF A PETITION
IN BANKRUPTCY BY OR AGAINST THE CUSTOMER; THE APPOINTMENT OF A RECEIVER IS
FILED BY OR AGAINST CUSTOMER; AN ATTACHMENT IS LEVIED AGAINST ANY ACCOUNT
OF THE CUSTOMER OR IN WHICH THE CUSTOMER HAS AN INTEREST OR; THE CUSTOMER'S
DEATH. IN SUCH EVENT, THE BROKER IS AUTHORIZED TO SELL ANY AND ALL
SECURITIES AND OTHER PROPERTY IN ANY ACCOUNT OF THE CUSTOMER WHETHER
CARRIED INDIVIDUALLY OR JOINTLY WITH OTHERS, TO BUY ALL SECURITIES OR OTHER
PROPERTY WHICH MAY BE SHORT IN SUCH ACCOUNT(S), TO CANCEL ANY OPEN ORDERS
AND TO CLOSE ANY OR ALL OUTSTANDING CONTRACTS, ALL WITHOUT DEMAND FOR
MARGIN OR ADDITIONAL MARGIN, OTHER NOTICE OF SALE OR PURCHASE, OR OTHER
NOTICE OR ADVERTISEMENT EACH OF WHICH IS EXPRESSLY WAIVED BY THE CUSTOMER.
ANY SUCH SALES OR PURCHASES MAY BE MADE AT BROKER'S DISCRETION ON ANY
EXCHANGE OR OTHER MARKET WHERE SUCH BUSINESS IS USUALLY TRANSACTED OR AT
PUBLIC AUCTION OR PRIVATE SALE, AND BROKER MAY BE THE PURCHASER FOR
BROKER'S OWN ACCOUNT. IT IS UNDERSTOOD A PRIOR DEMAND, OR CALL, OR PRIOR
NOTICE OF THE TIME AND PLACE OF SUCH SALE OR PURCHASE SHALL NOT BE
CONSIDERED A WAIVER OF BROKER'S RIGHT TO SELL OR BUY WITHOUT DEMAND OR
NOTICE AS HEREIN PROVIDED.
11. Margin
The Customer agrees to maintain in all accounts with the Broker such
positions and margins as required by all applicable statutes, rules,
regulations, procedures and custom, or as the Broker deems necessary or
advisable. The Customer agrees to promptly satisfy all margin and
maintenance calls.
12. Satisfaction of Indebtedness
The Customer agrees to satisfy, upon demand, any indebtedness, and to pay
any debit balance remaining when the Customer's Account is closed, either
partially or totally. Customer Account(s) may not be closed without Broker
first receiving all securities and other property for which the Account is
short and all funds to pay in full for all securities and other property in
which the Account(s) are long.
13. Transactions and Settlements
All orders for the purchase or sale of securities and other property will be
authorized by the Customer and executed with the understanding that an actual
purchase or sale is intended and that it is the Customer's intention and
obligation in every case to deliver certificates or commodities to cover any and
all sales or to receive and pay for certificates or commodities upon the
Broker's demand. If the Broker makes a short sale of any securities and other
property at the Customer's direction or if the Customer fails to deliver to the
Broker any securities and other property that the Broker has sold at
the Customer's direction, the Broker is authorized to borrow the securities and
other property necessary to enable the Broker to make delivery and the Customer
agrees to be responsible for any cost or loss the Broker may incur, or the cost
of obtaining the securities and other property if the Broker is unable to borrow
it. The Broker is the Customer's agent to complete all such transactions and is
authorized to make advances and expend monies as are required.
14. Sales by Customer
The Customer understands and agrees any order to sell "short" will be
designated as such by the Customer, and that the Broker will mark the order
as "short". All other sell orders will be for securities owned ("long") at
that time; by the Customer by placing the order the Customer affirms that
he will deliver the securities on or before the settlement date.
15. Broker as Agent
The Customer understands that the Broker is acting as the Customer's agent,
unless the Broker notifies the Customer, in writing before the settlement
date for the transaction, that the Broker is acting as a dealer for its own
account or as agent for some other person.
16. Confirmations and Statements
Confirmations of transactions and statements for the Customer's Account(s)
shall be binding upon the Customer if the Customer does not object in
writing, within ten days after receipt by the Customer. Notice or other
communications including margin and maintenance calls delivered or mailed
to the address given below shall, until the Broker has received notice in
writing of a different address, be deemed to have been personally delivered
to the Customer whether actually received or not.
17. SUCCESSORS
Customer hereby agrees that this Agreement and all the terms thereof shall
be binding upon Customer's heirs, executors, administrators, personal
representatives and assigns. This agreement shall enure to the benefit of
the Broker's present organization, and any successor organization,
irrespective of any change or changes at any time in the personnel thereof,
for any cause whatsoever.
18. CHOICE OF LAWS
THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF NEW YORK
AND SHALL BE CONSTRUED, AND THE RIGHTS AND LIABILITIES OF THE PARTIES
DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
19. Capacity to Contract, Customer Affiliation
By signing below, the Customer represents that he/she is of legal age, and
that he/she is not an employee of any exchange, or of any corporation of
which any exchange owns a majority of the capital stock, or of a member of
any exchange, or of a member firm or member corporation registered on any
exchange, or of a bank, trust company, insurance company or of any
corporation, firm or individual engaged in the business of dealing, either
as broker or as principal, in securities, bills of exchange, acceptances or
other forms of commercial paper, and that the Customer will promptly notify
the Broker in writing if the Customer is now or becomes so employed. The
Customer also represents that no one except the Customer has an interest in
the account or accounts of the Customer with you.
<PAGE>
20. ARBITRATION DISCLOSURES
o ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
o THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT, INCLUDING
THE RIGHT TO JURY TRIAL.
o PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND DIFFERENT
FROM COURT PROCEEDINGS.
o THE ARBITRATORS' AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR
LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK MODIFICATION OF
RULINGS BY THE ARBITRATORS IS STRICTLY LIMITED.
o THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF ARBITRATORS
WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
21. ARBITRATION
THE CUSTOMER AGREES, AND BY CARRYING AN ACCOUNT FOR THE CUSTOMER THE BROKER
AGREES, THAT ALL CONTROVERSIES WHICH MAY ARISE BETWEEN US CONCERNING ANY
TRANSACTION OR THE CONSTRUCTION, PERFORMANCE, OR BREACH OF THIS OR ANY
OTHER AGREEMENT BETWEEN US PERTAINING TO SECURITIES AND OTHER PROPERTY,
WHETHER ENTERED INTO PRIOR, ON OR SUBSEQUENT TO THE DATE HEREOF, SHALL BE
DETERMINED BY ARBITRATION. ANY ARBITRATION UNDER THIS AGREEMENT SHALL BE
CONDUCTED PURSUANT TO THE FEDERAL ARBITRATION ACT AND THE LAWS OF THE
STATE DESIGNATED IN PARAGRAPH 18, BEFORE THE AMERICAN ARBITRATION
ASSOCIATION, OR BEFORE THE NEW YORK STOCK EXCHANGE, INC. OR AN ARBITRATION
FACILITY PROVIDED BY ANY OTHER EXCHANGE OF WHICH THE BROKER IS A MEMBER, OR
THE NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. OR THE MUNICIPAL
SECURITIES RULEMAKING BOARD AND IN ACCORDANCE WITH THE RULES OBTAINING OF
THE SELECTED ORGANIZATION. THE CUSTOMER MAY ELECT IN THE FIRST INSTANCE
WHETHER ARBITRATION SHALL BE BY THE AMERICAN ARBITRATION ASSOCIATION, OR BY
AN EXCHANGE OR SELF-REGULATORY ORGANIZATION OF WHICH THE BROKER IS A
MEMBER, BUT IF THE CUSTOMER FAILS TO MAKE SUCH ELECTION, BY REGISTERED
LETTER OR TELEGRAM ADDRESSED TO THE BROKER AT THE BROKER'S MAIN OFFICE,
BEFORE THE EXPIRATION OF TEN DAYS AFTER RECEIPT OF A WRITTEN REQUEST FROM
THE BROKER TO MAKE SUCH ELECTION, THEN THE BROKER MAY MAKE SUCH ELECTION.
THE AWARD OF THE ARBITRATORS, OR OF THE MAJORITY OF THEM, SHALL BE FINAL,
AND JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT, STATE OR
FEDERAL, HAVING JURISDICTION.
22. LOAN OR PLEDGE OF SECURITIES
THE CUSTOMER HEREBY AUTHORIZES THE BROKER TO LEND EITHER TO ITSELF OR TO
OTHERS ANY SECURITIES HELD BY THE BROKER IN THE CUSTOMER'S MARGIN ACCOUNT
AND TO CARRY SUCH PROPERTY IN ITS GENERAL LOANS. SUCH PROPERTY MAY BE
PLEDGED, REPLEDGED, HYPOTHECATED OR REHYPOTHECATED EITHER SEPARATELY OR IN
COMMON WITH OTHER SUCH PROPERTY FOR ANY AMOUNTS DUE TO THE BROKER THEREON
OR FOR A GREATER SUM, AND THE BROKER SHALL HAVE NO OBLIGATION TO RETAIN A
LIKE AMOUNT OF SIMILAR PROPERTY IN ITS POSSESSION AND CONTROL.
BY SIGNING THIS AGREEMENT THE CUSTOMER ACKNOWLEDGES THAT:
1. THE SECURITIES IN THE CUSTOMER'S MARGIN ACCOUNT MAY BE LOANED TO THE
BROKER OR LOANED OUT TO OTHERS, AND
2. THAT THE CUSTOMER HAS RECEIVED A COPY OF THIS AGREEMENT.
THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION CLAUSE AT PAGE 3 AT
PARAGRAPH 21.
4/7/94 /s/ Barry Florescue
_________________________ ______________________________
Date Customer signature
_________________________ ______________________________
Date Joint owner signature
EXHIBIT B
KEMPER CLEARING CORP. CUSTOMER ACCOUNT AGREEMENT and DISCLOSURE DOCUMENT
DESIGNATION OF RESPONSIBILITIES
(NYSE RULE 382 DISCLOSURE)
Kemper Clearing Corp. (KCC) and your Broker have allocated between us
several functions and responsibilities with respect to your account.
Specifically:
1. Your Broker shall be solely responsible for opening, approving and
monitoring your account. This means that among other things, your Broker (and
not KCC) is solely responsible for:
a. Receiving and reviewing any financial or personal information about
you and your investment objectives;
b. Determining if a specific investment strategy is suitable or
appropriate for you;
c. Supervising the volume of activity, or any other matter regarding the
quantity, quality or specifics of any securities or options transaction in
your account;
d. Making recommendations regarding a specific security or investment
strategy;
e. Providing you with research or market interpretations regarding the
advisability of purchasing or selling a specific security (although your
Broker may receive materials from KCC that discuss in general the condition
of a specific company or industry group and that may be used by your Broker
in making specific recommendations to you);
f. If you have an options account or engage in transactions in listed
securities options:
i. delivering a current Options Clearing Corporation (OCC) brochure
- - "Characteristics and Risks of Standardized Options" - to you prior to your
first options trade and delivering to you periodic updated versions of this
brochure as they are published by the OCC;
ii. determining which options strategies are suitable for you;
iii. notifying you when you have been assigned delivery
responsibility on a short options position;
iv. accepting exercise notices from you for long options positions
in your account.
2. KCC will be responsible for extending credit to you for transactions
involving margin or otherwise effected through your KCC account. Your Broker,
however, is responsible for communicating all information to you regarding
margin and credit, including communicating and processing margin calls. KCC
may, nevertheless, contact you as well with respect to margin deficiencies in
your account(s).
3. KCC shall maintain books and records relating to the settlement and
clearing of cash and securities transactions in your KCC account. To the
extent KCC provides execution services for your Broker (see paragraph 6.
below) it will maintain records relating to execution. All other books and
records including information regarding your personal financial information
and investment objectives, records relating to orders to purchase or sell
securities and communications between you and your Broker, including
correspondence and documents relating to advertising and promotion will be
maintained solely by your Broker.
4. KCC shall be responsible for holding and safekeeping your money, funds and
securities. You may deliver money and securities to KCC or your Broker for
deposit to your KCC account provided, however, that KCC shall only be
responsible for holding and safekeeping your money, funds and securities from
the time they are actually received by KCC from you or your Broker.
5. KCC is responsible for providing you with written confirmation of each
transaction entered for your account. KCC is also responsible for providing
you with at least a quarterly summary of the status of your KCC account that
will list your securities and cash positions, margin debt and open options
positions, if applicable.
6. Your Broker is solely responsible for accepting orders from you to buy,
sell, margin, tender, or exchange securities for settlement in your KCC
account. Your Broker is also responsible for execution of those orders on the
applicable exchange or market. Your Broker may request that KCC assist with
the execution of orders settled in your KCC account. IN THOSE CASES WHERE KCC
ASSISTS YOUR BROKER WITH EXECUTION, KCC IS ACTING ON BEHALF OF YOUR BROKER
ONLY AND NOT DIRECTLY FOR YOU. KCC may rely on any order or instruction it
receives from your Broker without further inquiry, and orders for your
account may only be entered by and through your Broker.
7. In addition, as part of its clearing and settlement services, KCC will (a)
collect from or pay to third parties money due to or from you for securities
transactions in your KCC account; (b) receive from third parties or deliver
to third parties securities purchased or sold, as the case may be; (c)
collect and pay to you dividends or interest due on securities held in your
KCC account in KCC's name ("street registration") and charge your KCC account
for interest or dividends improperly credited to your account; (d) on your
instruction, process exchange, rights and tender offers with respect to
securities in your KCC account and (e) in the case of an account which trades
in listed securities options, allocate assignment or exercise notices or
execute notices to exercise, as the case may be.
We appreciate the opportunity to be of service. Your Broker should be
able to answer any questions you may have respecting your accounts. If,
however, you have questions concerning those areas for which KCC is
responsible, which your Broker cannot answer, please feel free to contact
KCC at the following address:
Kemper Clearing Corp.
Attention: Correspondent Services
PO Box 2034
Milwaukee, Wisconsin 53201-9450
<PAGE>
CUSTOMER AGREEMENT
THIS AGREEMENT sets forth the terms and conditions under which Kemper
Clearing Corp. (KCC), its subsidiaries affiliates, agents and its and
their successors and assigns will maintain your account for purchases
and sales of securities and other property. Your signature on the
attached signature page will constitute your acceptance of and agreement
to these terms and conditions.
8. Clearance Accounts
You acknowledge that KCC is carrying your account as clearing broker by
arrangement with another Broker and through whose courtesy your account
has been introduced. The accompanying letter (NYSE Rule 382 Disclosure,
set forth in paragraphs 1 through 7 above), which is incorporated herein
by reference, sets out the duties, responsibilities and obligations of
KCC and your Broker with regard to your account. By signing this
Agreement, you acknowledge that you have read this letter and
understand the limited duties, responsibilities and obligations which
KCC owes to you. Moreover, KCC neither overseas nor supervises the
activities of your Broker. KCC may, under certain circumstances, provide
execution services for your broker, which services may include execution
of orders for your account. Unless KCC receives a written notice from
you to the contrary, KCC shall accept from such Broker, without any
inquiry or investigation by it (i) orders for the purchase or sale in
your account of securities and other property on margin or otherwise, to
the extent KCC provides execution services to your Broker, and (ii) any
other instructions concerning your account. You acknowledge and agree
that KCC shall not be responsible to you for any loss resulting from the
conduct (including but not limited to errors, omissions and negligence)
on the part of any third party, including your Broker who introduced
your account to KCC. You specifically agree that KCC shall have no
obligation or duty to supervise the activities of any such third party,
including your Broker, and you agree to indemnify and hold KCC harmless
from and against all losses, liabilities and damages, including
attorney's fees, incurred by KCC as a result of any actions taken or not
taken by your Broker and such third parties.
9. Applicable Law and Regulations
All transactions in your account shall be subject to all applicable laws
and the rules and regulations in effect now and as amended from time to
time of all federal, state and self-regulatory agencies, including but
not limited to the Board of Governors of the Federal Reserve System and
the constitution, rules and customs of the exchange of market (and its
clearing house) where executed.
10. Security Interest and Lien
You hereby acknowledge that it is your intention and obligation and you
hereby agree upon KCC's demand to deliver certificates, commodities or
other property to cover all of your sales in your account and, in the
case of purchases, to pay for securities, commodities or other property
in accordance with this agreement and all applicable laws. You agree
that KCC shall have a continuing security interest in all your property,
including but not limited to securities, commodity futures contracts,
options, commercial paper, monies, and any after-acquired property held
by it for any purpose including safekeeping or carried in your account,
as security for the payment of all of your obligations and liabilities
to KCC. In the event of a breach or default under this Agreement, KCC
shall have all rights and remedies available to a secured creditor
under the Uniform Commercial Code of Wisconsin as then in effect in
addition to the rights and remedies provided herein or otherwise by law.
11. Deposits on Cash Transactions
If at any time KCC considers it necessary for its protection it may in
its discretion or in accordance with applicable laws require you to
deposit cash or collateral in your account to assure due performance by
you of your open contractual commitments or in accordance with
applicable laws or your other obligations to KCC, however created.
12. Breach, Bankruptcy or Default
Any breach of this Agreement or the filing of a petition in bankruptcy
or for the appointment of a receiver by or against you or the levy of an
attachment against your account(s) with KCC, or your death, mental
incompetency or dissolution, shall constitute, at KCC's election, a
default by you under all other agreements KCC may then have with you
(whether heretofore or hereafter entered into) for the purchase from you
or sale to you of any property or any other type of transaction. KCC
reserves the right to sell any and all property in your account(s) with
it (either individually or jointly with others), to buy any or all
property that may be short in such accounts and/or to cancel all
outstanding transactions and/or orders and to offset any indebtedness in
your account against any other account you may have (either individually
or jointly with others), and you shall be liable to KCC for any loss
and/or costs substained, together with interest thereon at the maximum
interest permitted under the laws of the State of Wisconsin, computed
daily on the basis of a 360-day year. Any such purchases and/or sales
may be public or private and may be made without notice or advertisement
and in such manner as KCC may in its discretion determine. At any such
sale or purchase, KCC may purchase or sell the property free of any
right of redemption.
13. Binding Effect
You hereby agree that this Agreement and all the terms thereof shall be
binding upon your heirs, executors, administrators, personal
representatives, successors and assigns, as the case may be.
14. Finality of Reports
Reports of the execution of an order and trade confirmations, to the
extent provided by KCC, and Statements of your account shall be
conclusive if not objected to in writing within five days and ten days,
respectively, after transmittal to you by mail or otherwise. Written
objections under this paragraph 14 shall be sent directly to:
Kemper Clearing Corp.
PO Box 2034
Milwaukee, Winconsin 53201-9450
15. Costs of Collection
In the event that KCC has to employ counsel or a collection agency to
collect any debit balance you owe, you hereby authorize KCC to charge
you for the reasonable costs of collection, including but not limited to
attorney's fees, court costs and expenses whatsoever in nature incurred
by it in effecting said collection.
16. Impartial Lottery Allocation
You agree, that in the event KCC holds on your behalf bonds or preferred
stock in street or bearer form that are callable in part, you will
participate in the impartial lottery allocation system of the called
securities in accordance with the rules of the New York Stock Exchange,
Inc. Further, you understand when the call is favorable, no allocation
will be made to any account in which KCC, its officers, directors or
employees have financial interest until all other customers are
satisfied on an impartial lottery basis.
17. Waiver; Assignment and Notices
No term or provision of this Agreement may be waived or modified unless
in writing and signed by the party against whom such waiver or
modification is sought to be enforced. For any such waiver or
modification to be binding on KCC, it must be signed by an officer of
KCC, who is authorized to act on its behalf. KCC's failure to insist at
any time upon strict compliance with this Agreement or with any of the
terms hereunder or any continued course of such conduct on its part
shall in no event constitute or be considered a waiver by KCC of any of
its rights or privileges. This Agreement contains the entire
understanding between you and KCC concerning the subject matter of this
Agreement. You may not assign your rights and obligations hereunder
without first obtaining the prior written consent of KCC. Notice or
other communications delivered or mailed to the address given below
shall, until KCC has received notice in writing of a different address,
be deemed to have been personally delivered to you.
18. Wisconsin Law to Govern
This Agreement shall be deemed to have been made in the State of
Wisconsin and shall be construed, and the rights and liabilities of the
parties determined, in accordance with the laws of the State of
Wisconsin (except for Wisconsin's choice of law rules, which are
superseded by this paragraph).
19. Limitation of Action
No suit, arbitration, proceeding, claim or action arising out of or
relating to this Agreement may be maintained by either you or KCC unless
it shall be commenced within one (1) year after the first occurrence of
the event upon which the claim or cause of action is based.
20. Venue and Jurisdiction
All actions or proceedings arising directly, indirectly or otherwise in
connection with, out of, in relation to, or from this Agreement or any
transaction covered hereby, if pursued through the federal or state
court system, shall be commenced and maintained only in courts located
in the City of Milwaukee, State of Wisconsin. You specifically consent
and submit to the jurisdiction of any such court and appoint any entity
as KCC may appoint from time to time to be your lawful attorney-in-fact
and duly authorized agent for service of lawful process. You agree that
service of such process upon your agent as designated herein shall
constitute personal service upon you; provided, however, that your agent
shall, within five (5) days after receipt of such summons, forward to
you the summons together with all papaers affixed thereto by certified
or registered mail, at the address set forth below. In the event you
commence, initiate or demand any non-judicial proceeding, including but
not limited to arbitration, with respect to any matter arising directly,
indirectly or otherwise in connection with, out of, in relation to, or
from this Agreement, then the situs of any hearing held in connection
with such proceeding or arbitration shall only be at such location
within the City of Chicago, State of Illinois, as KCC shall designate,
and no other place. You specifically waive the right to contest or
change the venue of any proceeding, or the jurisdiction of any court or
tribunal as designated in this paragraph 20.
21. Partial Unenforceability
If any provisions herein are or should become inconsistent with any
present or future law, rule or regulation of any sovereign government or
a regulatory body having jurisdiction over the subject matter of this
Agreement, such provision shall be deemed to be rescinded or modified in
accordance with any such law, rule or regulation. In all other respects,
this Agreement shall continue and remain in full force and effect.
MONEY MARKET FUNDS
KCC may provide to your Broker the ability to offer to you a no-load
money market mutual fund (the Fund). If such Fund is made available to
you by your Broker, you hereby agree that the following terms and
conditions will govern your participation in the Fund.
22. Upon your receipt of the prospectus for the Fund you choose, your
securities account will be linked to the Fund. You must have in your
securities account a free credit cash balance of at least $1,000 (in
excess of any unsettled transactions). The initial investment of $1,000
or more, and subsequent free credit cash balances resulting from
securities sales, additional cash deposits on normal settlement days
and, if requested, interest or dividends, (that is, any cash that may be
transfered out of your account without resulting in interest charges) will
automatically be invested in shares of the Fund at their current net asset value
at least once a week (automatic purchase order).
23. The purchase price for shares of the Fund will be the net asset
value per share next determined after the Fund's receipt of the
automatic purchase order. Shares of the Fund will automatically be
redeemed at net asset value to satisfy debit balances in your various
accounts. KCC reserves the right to redeem all Fund shares should the
value of your Fund shares held in your account go below $500.00.
24. Option requirements as well as commodity requirements may be
considered as debit balances for automatic redemption purposes. Short
account available funds will be those in excess of $2,000 above the
normal requirements of the account. Liquidations for the short account
will be made only when the $2,000 reserve is used up. The liquidation
will be sufficient to build the reserve back to a minimum of $2,000.
This procedure is to eliminate the need for small liquidations at
frequent intervals as the short is marked to the market. At any time,
you may request liquidation of Fund shares from your account by
notifying your Account Executive (minimum liquidation is $100.00).
25. Dividends will be declared each day on shares of the Fund owned by
you and will be reinvested once each month in additional Fund shares
unless requested by you to be paid out in cash. Under certain
circumstances a monthly fee is charged on customer balances in the Fund.
The fee will be equal to 0.15% per year or 12.5 cents per $1,000 per
month for taxable funds; 0.075% or 6.25 cents per $1,000 per month for
tax exempt funds. The fee will be deducted automatically from monthly
income in the form of a 0.15% (15 basis points) reduction in yield for
taxable funds; 0.075% (7 1/2 basis points) for tax exempt funds. The
maximum annual fee for any account is $150.00. For tax exempt funds, the
maximum annual fee is $75.00.
26. Your Customer Statement will detail transactions in the Fund,
distributions of additional shares reflecting the current month's
earnings and Redemption checks during the preceding month. This
Statement will be provided at least quarterly. Neither the Fund nor KCC
will send out confirmations on each occasion that shares of the Fund are
either bought or redeemed through your account, but the Statement will
describe the transactions in the Fund that took place during the
preceding month. You understand that the Statement should be carefully
reviewed by you.
27. You may terminate your money market fund account at any time by
notifying KCC in writing, but you will remain responsible for any
charges to your account whether arising before or after termination. You
also understand that KCC may terminate your money market fund account at
any time.
MARGIN AND OPTION ACCOUNTS
28. Margin in Margin Account
You hereby agree to maintain such margins in your margin account as KCC
may in its discretion require from time to time and you agree to pay
forthwith on demand any debit balance owing with respect to any of your
margin accounts. If there is a decline in the market value of your
securities, KCC may require that you deposit additional collateral in
order to maintain the margin in your account or accounts. Any failure by
you to maintain any margin required by KCC or to pay any debit balance
due shall be a breach of this Agreement and KCC may take such action as
it considers necessary for its protection in accordance with this
Agreement. Margin calls and related correspondence will generally be
communicated by your Broker although KCC may, in its discretion, contact
you directly with respect to such matters. Margin calls can be satisfied
by the deposit of additional securities and/or cash. You will be charged
interest on your debit balance at a rate that will be based on the
broker call money rate then in effect which, if not paid at the close of an
interest period, will be added to the opening balance for the next
period. The actual formula to compute the amount of interest charged
against your account from time to time is set forth in the "Truth in
Lending" statement enclosed herein. The broker call money rate shall be
based on published rates for call money lent to brokers on stock
exchange collateral or broker call money rates as quoted by commercial
banks, as determined by KCC. Margin interest shall be computed daily on
the basis of your closing margin balance utilizing a 360-day year. The
rate of interest to be charged may vary from time to time based on
fluctuations in the broker call money rate charged to KCC, as well as
the size of your debit balance and other factors (see paragraph 35). KCC
reserves the right to change the rate of interest to be charged for
margin transactions in your account without prior notice to you and you
expressly waive any requirement of such prior notice.
29. Customer's Consent to Loan or Pledge of Securities
You hereby agree that all securities and commodities or any other
property now or hereafter held by KCC or carried by KCC for you (either
individually or jointly with others), or deposited to secure the same
may from time to time and without notice to you, be carried in KCC's
general loans and may be pledged, repledged, hypothecated or
re-hypothecated separately or in common with other securities and
commodities or for any other property, for the sum due to KCC thereon
or, subject to Applicable Laws, for a greater sum and without retaining
in KCC's possession and control for delivery a like amount of similar
securitiesw or commodities.
30. Acknowledgement of Receipt of OCC Disclosure Brochure
By placing an order to buy or sell listed securities options that will
be executed or cleared and settled through your KCC account, you
represent to KCC that you have already received the OCC brochure
Characteristics and Risks of Standardized Options and you acknowledge
that KCC is relying on this representation in accepting your options
order for execution, settlement or clearing, as the case may be.
31. Position or Exercise Limits
You agree that you will not, either acting alone or in concert with
others, violate the position or exercise limits as promulgated from time
to time by any exchanges on which transactions on your behalf are
executed, (the "Exchange") and any applicable self-regulatory
organizations.
32. Matters Beyond Control of KCC
You acknowledge and understand that on certain trading days, trading may
cease or be restricted by order of the Exchange or governmental body in
one or more classes of options and that this may result in financial
disadvantage or loss to you. You agree to hold KCC, its officers,
directors, employees and agents, harmless from this or any other loss
resulting from any acts made in accordance with the constitution, rules,
interpretations and policies, customs, or regulations of the Exchange,
the Options Clearing Corporation, the National Association of Securities
Dealers, Inc. or any other governmental or self-regulatory organization
exercising jurisdiction.
33. Exercise of Options
You understand and agree to abide by KCC's requirements and time
limitations as communicated to you by your Broker for accepting an
exercise notice from you. KCC allocates exercise assignment notices
among customer short options positions according to an impartial system
of a manual or computer generated random assignment method.
TRUTH IN LENDING STATEMENT
We wish to inform you of the terms and conditions under which interest
charges will be applied to your accounts with us.
34. You will be charged interest on any credit extended to or maintained
for you by KCC for the purpose of purchasing, carrying, or trading in
any securities, or otherwise.
35. The annual rate of interest charged on the net debit balance in your
margin account will be based on the schedule as provided by your Broker.
The rate of interest applicable to your account is subject to change
without prior notice when changes occur in the broker call money rate.
The broker call money rate is based on published rates for call money
lent brokers on stock exchange collateral or broker call money rates
quoted by commercial banks, as determined by KCC. If your interest rate
is to be increased for any other reason, you will be given at least
forty-five (45) days prior written notice.
The rate of interest charged on the debit balance in your margin account
may be based on a number of factors, including the size of your debit
balance, the market value and quality of the securities in your account,
the equity in your account, the amount of commission paid by you, and
other business considerations.
36. Debit balances represent money loaned to you by KCC. When you
purchase securities on margin you must pay the amount of money required
by regulations of the Federal Reserve Board. The balance of the purchase
price is loaned to you. This loaned portion creates the debit balance
upon which interest is charged. Each additional purchase adds to your
debit balance as do your interest charges and any other charge which may
be assessed to your account.
37. Any credit or debit balance on the cash account will be combined
with the balance in the margin account for the purpose of computing
interest. Only one net entry for interest will appear in the margin
account. Interest charges will be made on any extension of credit even
if it is not directly related to purchases in your margin account.
Examples of such extensions of credit would include but not be limited
to prepayments to you for securities sold and late payments received
from you on purchases in your cash account. Interest charged shall be
determined by the rate applied to your margin account.
38. Interest is calculated daily based on your ending net daily debit
balance which includes any credit and debit balances in your cash and
margin accounts during the interest period. The interest charge is
culculated by multiplying the ending net daily debit balance by the
interest rate and dividing by 360. Your Statement will show the net
daily balance and interest rate used to arrive at the amount of interest
charged.
Any credit that appears on your Statement due to short sales (including
short sales against the box) is offset by a debit of like amount because
KCC has to borrow the security in order to deliver it to the buying
broker. The credit generated by any short sales against the box does not
reduce your debit balance for the purpose of computing interest until
the short position is covered.
If any security you sold short (or sold short against the box)
appreciated in market price over the selling price, interest may be
charged on the appreciation in value. If the security you sold short
depreciated in market price, the debit balance is correspondingly
reduced by the decrease in value. This practice is known as
"marking-to-the-market." Daily closing prices are used to determine any
appreciation or depreciation of the security sold short.
REQUEST FOR TAXPAYER IDENTIFICATION NUMBER
Instructions For Substitute Form W9
(Section references are to the Internal Revenue Code).
Purpose of Form
Complete this form and give it to the payer of interest, dividends and
certain other payments (including broker and barter exchange
transactions) so that you will not be subject to the 20% backup
withholding that became effective January 1, 1984.
Use this form to report and certify your taxpayer identification
number (TIN) to the payer, to certify that you are not subject to backup
withholding because of under reporting interest and dividends on your
tax return, and to claim exemption from backup withholding if you are an
exempt payee.
If you do not complete this form properly and return it to the payer,
the payer may be required to withhold 20% of payments made to you.
What is Backup Withholding
The interest and Dividend Tax Compliance Act of 1983 requires payers to
withhold and pay to IRS 20% of payments of interest, dividends, and
certain other payments under certain conditions. This is called "backup
withholding." If you give the payer your correct TIN, certify your TIN
when required, and report all your taxable interest and dividends on
your tax return, your payments will not be subject to backup
withholding.
Payments you receive will be subject to backup withholding if:
(1) You do not furnish your TIN to the payer,
or
(2) IRS notifies the payer that you furnished an incorrect TIN, or
(3) You are notified by IRS that you are subject to backup withholding
because you failed to report all your interest and dividends on your tax
return (for interest and dividend accounts only), or
(4) You fail to certify to the payer that you are not subject to backup
withholding under (3) above (for interest and dividend accounts opened
after 1983 only), or
(5) You fail to certify your TIN. This applies only to interest,
dividend, broker or barter exchange accounts opened after 1983, or
broker accounts considered inactive in 1983. For other payments, you are
subject to backup withholding only if (1) or (2) above applies.
How to Obtain a TIN
If you do not have a TIN, you should apply for one immediately. To apply
for the number obtain Form SS-5, Application for a Social Security
Number Card (for individuals), or Form SS-4, Application for Employer
Identification Number (for businesses and all other entities), at your
local office of the Social Security Administration or the Internal
Revenue Service. Complete and file the appropriate form according to its
instructions.
If you do not have a TIN, write "Applied For" in the space for the TIN,
sign and date the form, and give it to the payer. You will then have 60
days to obtain a TIN and furnish it to the payer. During the 60-day
period, the payments you receive will not be subject to the 20% backup
withholding. However, if the payer does not receive your TIN from you
within 60 days, backup withholding will begin and continue until you
furnish your TIN to the payer.
Note: Writing "Applied For" on the form means that you have already
applied for a TIN, OR that you intend to apply for one in the near
future.
As soon as you receive your TIN, complete another Form W-9, include your
new TIN, sign and date the form, and give it to the payer.
CASH ACCOUNTS
SECTION 1 (SIGNATURE REQUIRED)
I have read the preceding Agreement (as denoted in paragraphs 1-21) and
understand and agree that my account with KCC will be governed by the
provisions of this Agreement. By signing this Agreement, I acknowledge that I
have received a copy of this Agreement.
In addition to the foregoing, I have read the provisional sections (as denoted
in paragraphs 22-27) and understand and agree that my account with KCC will be
governed by the provisions of this Agreement. I also have selected the following
money market mutual fund (a no-load invesment of free credit balances over
$1,000 in my account).
CEF Money Market Portfolio CEF Government Securities Portfolio
- --- ---
CEF Tax Exempt Portfolio CEF Tax Exempt California Money Market Fund
- --- ---
NO Money Market Fund
- ---
286 BRIDGE ST. INC.
- ------------------------------------- --------------------------------------
Print Name Print Name
/s/ Barry Florescue
- ------------------------------------- --------------------------------------
Signature (if Joint Account both Signature
parties must sign)
SUBSTITUTE FORM W9
SECTION 2 (SIGNATURE REQUIRED)
Certification Under penalties of perjury, I certify that:
1) The number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me), and
2) I am not subject to backup witholding either because I have not been
notified by the Internal Revenue Service (IRS) that I am subject to backup
withholding as a result of a failure to report all interest or dividends,
or the IRS has notified me that I am no longer subject to backup
withholding. If this paragraph (2) is not correct, please cross it out.
Social security number 286 BRIDGE ST. INC.
----------------------------------------------
/ / / /-/ / /-/ / / / / Name Assoicated with the number indicated
OR:
Employer identification number /s/ Barry Florescue 8/8/94
-------------------------------- ----------
/5/8/-/1/8/1/-/2/3/5/5/ Signature Date
MARGIN AND OPTION ACCOUNTS
SECTION 3 (SIGN IF APPLICABLE)
In addition to the foregoing, I have read the provisional sections (as denoted
in paragraphs 28-38) that pertain to margin and option accounts and I
understand and agree that my activities in these areas at KCC will be governed
by these provisions. BY SIGNING THIS AGREEMENT I ACKNOWLEDGE THAT MY SECURITIES
AND PROPERTY, IN ACCORDANCE WITH PARAGRAPH 29, MAY BE LOANED SEPARATELY OR
TOGETHER, WITH THE SECURITIES OR PROPERTY OF OTHERS, EITHER TO KCC OR OTHERS.
286 BRIDGE ST. INC.
- ------------------------------------- --------------------------------------
Print Name Print Name
/s/ Barry Florescue
- ------------------------------------- --------------------------------------
Signature (if Joing Account both Signature
parties must sign)
286 BRIDGE STREET INC 48168890
701 S E SIXTH AVENUE RB01
SUITE 204 4C
DELRAY BEACH FL 33483-5186
Accepted at KCC by: Date:
-------------------------------------------- ------
EXHIBIT C
LADENBURG, THALMANN & CO. INC.
CORRESPONDENT SERVICES CORPORATION [CSC]
CLIENT'S AGREEMENT
Wire Code IQ
Account Number 36616
Full Account Title Florescue Family Corp. Broker 70
Introduction
1. This Agreement contains the terms governing any account(s) in my name for
the purchase or sale of property. In the Agreement, "I," "me" or "my" means
each person who signs below."You," "your" or "CSC" means Correspondent Services
Corporation and/or Ladenburg, Thalmann & Co. Inc., as applicable, its
successor firms, subsidiaries, corespondents, or affiliates, or employees.
"Property" means all securities, including but not limited to monies, stocks,
options, bonds, notes, futures, contracts, commodities, certificates of
deposit and other obligations, contracts or securities.
Applicable Rules and Regulations
2. All transactions for me shall be subject to the constitution, rules,
regulations, bylaws, interpretations, customs and usages of the exchange or
market and its clearing house, if any, where the transactions are executed.
Such transactions are also subject, where applicable, to the provisions,
rules and regulations of the Securities and Exchange Commission, the
Commodity Futures Trading Commission, the Board of Governors of the Federal
Reserve System in existence at this time and as later amended and
supplemented.
Amendment or Waiver
3. I agree that you may change the terms of this agreement at any time upon
prior written notice to me. By continuing to accept the services offered by
you, I indicate to you my acceptance of these changes. If I do not accept the
changes, I must notify you in writing of my refusal and my account will be
cancelled. However, I will remain liable for any outstanding Debits and/or
Charges on my account.
Transactions and Settlements
4. All orders for the purchase and sale of any property will be given by me
and executed with the distinct understanding that an actual purchase or sale
is intended and that it is my intention and obligation in every case to
deliver property to cover any and all sales and in the case of purchases to
receive and pay for property that I will do so upon your demand. In case you
make a short sale of any property at my direction or in case I fail to
deliver to you any property which you have sold at my direction, you are
authorized to borrow the property necessary to enable you to make delivery to
the purchaser and I agree to be responsible for the cost or loss you may
incur, or the cost of obtaining the property if you are unable to borrow it.
No settlement of my account(s) may occur without your first receiving all
property for which the account is short and all property in which the
account(s) are long being paid for in full and the property then delivered.
You and your correspondents are my constituted agents to complete all such
transactions and are authorized to make advances and expend monies as are
required.
Marking Sell Orders Long or Short
5. When placing with you any sell order for a short account, I will designate
it as such and hereby authorize you to mark the order as being "short." When
placing with you any order for a long account, I will designate it as such
and hereby authorize you to mark the order as being "long." Any sell order
which I shall designate as being for a long account, is for property which is
owned by me and, if you are unable to deliver this property from any
account(s), the placing of the order will constitute my representation that
the property will be delivered as required and that I will reimburse you for
any expense incurred.
Binding Order
6. Any order which I give shall be binding upon me, and (my/our) personal
representative until you receive notice of my death. Such death and notice
will not affect your right to take any action which you could have taken if
I had not died.
Accounts Carried as Clearing Broker
7. If you are carrying the account of the undersigned as clearing broker by
arrangement with another broker through whose courtesy the account of the
undersigned has been introduced to you, then until receipt from the
undersigned of written notice to the contrary, you may accept from such other
broker, without inquiry or investigation by you (a) orders for the purchases
or sale in said account of securities and other property on margin or
otherwise, and (b) any other instructions concerning said account. You shall
not be responsible or liable for any sale or omissions of such other broker
or its employees.
Lien Provisions
8. All property held or purchased shall be subject to a lien in your favor
for the discharge of all my indebtedness and any other obligations that I may
owe to you, however and whenever arising, and may be held by you as security
for the payment of any such obligations or indebtedness to you in any account
you maintain for me including any accounts in which I may have an interest.
You are authorized without notice to me whenever you deem it advisable from
time to time (a) to transfer interchangeably between any account(s) I have
with you any or all of the Property so held, without regard to whether you
have in your possession or subject to your control other Property of the same
kind and amount; (b) in the usual course of business pledge, repledge,
hypothecate (either for the amount I owe or for a greater or lesser sum) and
lend the same to you as broker or to others from time to time, separately or
commingled with Property carried for other clients and you shall not be
required to delivered to me the same Property but only Property of the same
kind and amount.
Payment of Indebtedness Upon Demand
9. I shall at all times be liable for the payment of any amounts advanced,
any debit balance or other obligations owing in any of my account(s) with you
and I shall be liable to you for any deficiency remaining in any such
account(s) in the event of the liquidation thereof, in whole or in part, by
you or by me. I shall make payment of any such debit balance, obligation,
deficiency, indebtedness, including attorney's fees, If incurred by you.
Interest Provision
10. All amounts advanced and other balances due shall be charged interest in
accordance with your usual custom, which may include the compounding of
interest, including any increases in rates which reflect adjustments in the
Base Loan Rate, and such other charges as you may make to cover your
facilities and extra services. Payment of all amounts advanced and other
balances due, together with the interest thereon, shall be made by me to you
at any of your offices which will act as my agent for the transmittal of such
amounts and other balances due to you at New York, New York.
I HAVE READ AND UNDERSTAND THE STATEMENT OF CREDIT PRACTICES DESCRIBING
INTEREST CHARGES PRINTED ON THE REVERSE SIDE.
Sub-Agents
11. You may employ sub-brokers and shall be responsible only for reasonable
care in their selection. You may deal with market makers or members of any
exchange known as specialists or known as odd lot dealers and in the execution
of my orders they may act as sub-brokers for me and may also buy or sell the
property for themselves as dealers for their own account.
Margin Requirements
12. I agree to maintain in account(s) with you such positions and margin as
required by all applicable statutes, rules, regulations, procedures, and
customs, or as you deem necessary or advisable, and where applicable, to
satisfy any and all margin calls issued in connection with such business.
Liquidations and Covering Positions
13. You shall have the right in accordance with your general policies
regarding your margin maintenance requirements in existence at the time or;
if in your discretion you consider it necessary for your protection to
require additional collateral or the liquidation of any account of mine, or,
in the event a petition in bankruptcy, or for appointment of a receiver is
filed by or against me, or, an attachment is levied against the account(s)
of mine, or; in the event of my death; to sell any or all property in the
account(s) of mine with you, whether carried individually or jointly with
others, to buy any or all property which may be short in such account(s),
to cancel any open orders and to close any or all outstanding contracts,
all without demand for margin or additional margin, other notice of sale or
purchase, or other notice of advertisement. Any such sales or purchases may
be made at your discretion on any exchange or other market where such
business is usually transacted, or at public auction or private sale, and
you may be the purchasers for your own account. It is understood a prior
demand, or call, or prior notice of the time and place of such sale or
purchase shall not be considered a waiver of your right to sell or buy
without demand or notice as herein provided.
Binding Notice of Agreement
14. I expressly agree you will not be bound by any representation or
agreement made by any of your employees or agents which purports to effect or
diminish your rights under this agreement.
Effect of Law or Rule Change
15. In the event any one or more of the provisions contained in this
agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such finding or holding shall only affect the
provision(s) involved and the remainder of this agreement and the application
of all other provisions shall not be affected.
Address
16. My address below is and will continue to be a correct address until your
Lincoln Harbor Office receives written notice of any change. Notices and
communications sent to me at such address will constitute personal delivery
to me, whether actually received or not.
Client Representation
17. I represent to have reached the age of majority according to the laws of
the state of my residence. I agree to abide by the rules of the regulatory
agencies and your firm's policy if I am employed by any exchange or any
corporation of which any exchange owns a majority of the capital stock;
member or firm registered on any exchange, bank, trust company, insurance
company; or any company or individual dealing, either as broker or principal,
in stocks, bonds, or any other securities, commodities, or commercial paper.
If during this agreement I become such an employee, you will be notified. No
one other than me has or will have an interest in any account(s) of mine
unless you are notified in writing by me.
Jurisdiction
18. All transactions made for my account(s) opened with you or introduced to
you as clearing broker through the aforementioned introducing firm shall be
governed by the terms of this agreement. This agreement and its enforcement
shall be construed and governed by the laws of the State of New York, and
shall be binding upon my heirs, executors, administrators, successors, and
assigns.
Credit Review
19. An investigation of my personal and business credit may be made and I may
make written request, within a reasonable time, for disclosure of the nature
of the investigation.
ARBITRATION
20. ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT, INCLUDING
THE RIGHT TO JURY TRIAL.
PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND DIFFERENT
FROM COURT PROCEEDINGS.
THE ARBITRATOR'S AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR
LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK MODIFICATION OF
RULINGS BY THE ARBITRATORS IS STRICTLY LIMITED.
THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE, AFFILIATED WITH THE SECURITIES INDUSTRY.
I AGREE AND BY CARRYING AN ACCOUNT FOR ME CSC AND/OR LADENBURG, THALMANN
& CO., INC. AGREE(S) THAT ANY AND ALL CONTROVERSIES WHICH MAY ARISE BETWEEN
ME AND CSC AND/OR LADENBURG, THALMANN & CO., INC. CONCERNING ANY ACCOUNT,
TRANSACTION, DISPUTE OR THE CONSTRUCTION, PERFORMANCE, OR BREACH OF THIS OR
ANY OTHER AGREEMENT, WHETHER ENTERED INTO PRIOR, ON OR SUBSEQUENT TO THE DATE
HEREOF, SHALL BE DETERMINED BY ARBITRATION. ANY ARBITRATION UNDER THIS
AGREEMENT SHALL BE HELD UNDER AND PURSUANT TO AND BE GOVERNED BY THE FEDERAL
ARBITRATION ACT, AND SHALL BE CONDUCTED BEFORE AN ARBITRATION PANEL CONVENED
BY THE NEW YORK STOCK EXCHANGE, INC. OR THE NATIONAL ASSOCIATION OF
SECURITIES DEALERS, INC. I MAY ALSO SELECT ANY OTHER NATIONAL SECURITIES
EXCHANGE'S ARBITRATION FORUM UPON WHICH CSC AND/OR LADENBURG, THALMANN & CO.
INC. IS LEGALLY REQUIRED TO ARBITRATE THE CONTROVERSY WITH ME, INCLUDING,
WHERE APPLICABLE, THE MUNICIPAL SECURITIES RULE MAKING BOARD. SUCH
ARBITRATION SHALL BE GOVERNED BY THE RULES OF THE ORGANIZATION CONVENING THE
PANEL. I MAY ELECT IN THE FIRST INSTANCE THE ARBITRATION FORUM, BUT IF I FAIL
TO MAKE SUCH ELECTION, BY REGISTERED LETTER OR TELEGRAM ADDRESSED TO YOU AT
YOUR MAIN OFFICE, BEFORE THE EXPIRATION OF FIVE DAYS (5) AFTER RECEIPT OF A
WRITTEN REQUEST FROM YOU TO MAKE SUCH ELECTION, THEN YOU MAY MAKE SUCH
ELECTION. THE AWARD OF THE ARBITRATORS, OR OF THE MAJORITY OF THEM, SHALL BE
FINAL, AND JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT OF
COMPETENT JURISDICTION.
NO PERSON SHALL BRING A PUTATIVE OR CERTIFIED CLASS ACTION TO ARBITRATION,
NOR SEEK TO ENFORCE ANY PRE-DISPUTE ARBITRATION AGREEMENT AGAINST ANY
PERSON WHO HAS INITIATED IN COURT A PUTATIVE CLASS ACTION; WHO IS A MEMBER
OF A PUTATIVE CLASS WHO HAS NOT OPTED OUT OF THE CLASS WITH RESPECT TO ANY
CLAIMS ENCOMPASSED BY THE PUTATIVE CLASS ACTION UNTIL; (I) THE CLASS
CERTIFICATION IS DENIED; (H) THE CLASS IS DECERTIFIED; OR (J) THE CUSTOMER
IS EXCLUDED FROM THE CLASS BY THE COURT. SUCH FOREBEARANCE TO ENFORECE AN
AGREEMENT TO ARBITRATE SHALL NOT CONSTITUTE A WAIVER OF ANY RIGHTS UNDER
THIS AGREEMENT EXCEPT TO THE EXTENT STATED HEREIN.
I EXPRESSLY AGREE THAT SERVICE OF PROCESS IN ANY ACTION SHALL BE SUFFICIENT IF
SERVED BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, AT MY LAST ADDRESS KNOWN TO
YOU. I EXPRESSLY WAIVE ANY DEFENSE TO SERVICE OF PROCESS AS SET FORTH ABOVE.
Assignment
21. This agreement may be assigned by you and will inure to the benefit
of your successors and assigns and you may transfer or assign the account(s) of
mine to them, which shall be binding on me and my personal representatives.
Accuracy of Reports
22. ALL REPORTS OF EXECUTION OF ORDERS AND ACCOUNT STATEMENTS SHALL BE
CONCLUSIVE IF NOT OBJECTED TO BY ME IN WRITING IMMEDIATELY BY NOTICE SENT
TO YOU BY REGISTERED MAIL.
Joint and Several Liability and Joint Accounts
23. If more than one person signs this agreement, our obligations under this
agreement shall be joint and several. If more than one person signs this
agreement, you may accept any orders and instructions from each, and upon
receipt of inconsistent instructions of a court order, may suspend or
terminate my account.
Liability for Costs of Collection
24. I agree to pay you the reasonable costs and expenses of collection,
including attorney's fees, for any unpaid Debits, Charges, and other amounts
owing you.
Loan Consent
25. BY SIGNING THIS AGREEMENT I ACKNOWLEDGE THAT YOU AND YOUR SUCCESSORS AND
ASSIGNS ARE AUTHORIZED IN THE USUAL COURSE OF BUSINES TO LEND, RELEND,
HYPOTHECATE, REHYPOTHECATE, PLEDGE OR REPLEDGE SEPARATELY OR TOGETHER WITH THE
PROPERTY OF OTHERS EITHER TO YOURSELVES OR TO OTHERS ANY PROPERTY WHICH YOU MAY
BE CARRYING FOR ME ON MARGIN. THIS AUTHORIZATION SHALL APPLY TO ALL ACCOUNTS
CARRIED BY YOU FOR ME AND SHALL REMAIN IN FULL FORCE UNTIL WRITTEN NOTICE OF
REVOCATION IS RECEIVED BY YOU.
BY SIGNING THIS AGREEMENT THE CUSTOMER ACKNOWLEDGES THAT:
1. THE SECURITIES IN THE CUSTOMER'S MARGIN ACCOUNT MAY BE LOANED TO THE BROKER
OR LOANED OUT TO OTHERS AND;
2. THAT THE CUSTOMER HAS RECEIVED A COPY OF THIS AGREEMENT.
THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION CLAUSE AT PAGE 1 AT PARAGRAPH
20.
LADENBURG, THALMANN & CO. INC. Correspondent Services Incorporation [CSC]
/s/ Barry Florescue President
[ CLIENT, BE ] ---------------------------------------------------------
[SURE TO RETAIN] (Signature of Principal) (Name and **************) Date
[ YOUR COPY ]
---------------------------------------------------------
(Signature of Second Party, if a Joint Account) Date
- --------------------------------------------------------------------------------
No. of Street Address City or Town State Postal Code
LADENBURG, THALMANN & CO. INC.
STATEMENT OF CREDIT PRACTICES
(SEC Rule 10b-16)
Effective August 22, 1992
Correspondent Services Corporation [CSC]
Ladenburg Thalmann clears through Correspondent Services Corporation
[CSC]. Securities held by CSC are protected by insurance coverage of up to
$2,500,000 including $100,000 for free cash balances.
The following discussion provides a description of our interest charges
and other matters relating to the extension or maintenance of credit in
connection with your securities accounts. Since it is intended to be all-
inclusive, some of the discussion may go beyond your own particular
situation.
Applicability of Interest Charge
You will be charged interest on any credit extended to you by
Correspondent Services Corporation (CSC) for the purpose of purchasing,
carrying, trading, or maintaining any securities or other product or service
in your account.
Interest Rate
The annual rate of interest which you will be charged is based upon the
Base Loan Rate ("Base Loan Rate") which will be internally established from
time to time based on our assessment of commercially recognized interest
rates. Such rates may include but are not limited to the prime rate, discount
rate, broker call rate, federal funds rate, LIBOR, and other regularly
published lending rates. The agreements with our clients for the extension of
credit are governed by the laws of the State of New York where CSC maintains
its principal place of business. The interest charge for each interest period
is due and payable at the close of that interest period. The exact amount due
may be obtained from your Investment Representative or the Office Manager of
the firm servicing your account. Interest charges not paid at the close of
the interest period will be added to the opening debit balance in your
account for the next interest period. Please note that the Base Loan Rate is
an internally computed rate that may change without notice.
The rates at which interest is charged on funds borrowed are dependent
upon the amount borrowed and are based on our usual sliding scale or
percentages added to the current Base Loan Rate. Subject to applicable law,
your rate will be 1-1/2% above the Basic Loan Rate.
Change of Rate Without Prior Notice
Your stated interest rate will change without notice each period in
accordance with changes in your average net loan (debit) balance and the Base
Loan Rate. If your interest rate is to be increased for any other reason, at
least 30 days prior written notice will be given by CSC. Certain accounts may
be assigned adjusted rates as warranted by overall business relationships in
the discretion of CSC.
Computation of Interest Charge
The following is set forth so that you can understand how interest
charges are computed and so that you may verify interest charges shown on
your statement.
We calculate daily loan (debit*) or credit balances for your account by
taking the balances as of the close of the previous interest period (or the
opening balance on a new account) and calculate for each day a new net loan
(debit) balance** from the previous daily balance by taking into
consideration both debits and credits which occurred that day. The market
value of securities sold not long or not in good deliverable form will be
deducted from the credit balance in your account. Credit balances resulting
from a short sale are disregarded because this credit balance is used to
collateralize stock borrowed to make delivery against a short sale. At the
end of the interest period the daily loan (debit) balances for each day of
the interest period are totalled and divided by the number of loan (debit)
days in the interest period giving the average net loan (debit) balance which
forms the basis for interest calculations.
The applicable interest period is from the 22nd day of each month to the
21st day of the following month, except for the months of December and
January. In December the applicable interest period is November 22 to
December 31; in January the applicable interest period is January 1 to
January 21.
Your statement should be retained to assist you in verifying interest
charges.
The "Credit Summary" section of your statement provides the interest
charge for the current interest period as well as the average net loan
(debit) balance and the interest rate applied. You can verify your interest
charge based on a 360 day year within a few cents by using the following
formula:
Average Loan (Debit) Days
Loan X Interest Rate X in Interest Period
Balance ------------------
360
* Average Daily Debit Balance - This represents the sum of the daily loan
(debit) balances in your account divided by the number of days on which the
loan (debit) balances existed.
** Net Loan (Debit) Balance - This is the debit balance minus credit balance
(ndb = db - cb).
Table 1 set forth below provides the effective annual interest rate for
your stated interest rate for 365 days for the above interest calculations.
Marking to the Market
If you sell short (or short against the box), and the market value of
the security you sold increases above your selling price, the increase will
be charged to your account - see Activity section (with an offsetting credit
to the Short Account - see Short Account Activity section) and interest on
the increase will be charged in the Activity section. Conversely, any
decrease in market value will be credited to your account and the interest
charges will be accordingly reduced.
This practice of determining the change in current market value is
commonly referred to as "marking to the market" and is normally done once a
week.
Other Charges
Separate interest charges may be made in the account in connection with:
a) prepayments - payments to a client of the proceeds of a security sale
before the regular settlement date.
b) "when issued" transactions - when the market price of the "when
issued" security changes from the contract price by an amount that exceeds
the cash deposit, interest may be charged on such difference.
c) late payments - payments for securities purchased which are received
past settlement date.
Liens and Additional Collateral
For all securities which we have or at any time may hold or carry for
you in any account of yours (either individually or jointly with others), or
which may be deposited with us for any purpose, including safekeeping, we as
a pledgee have a general lien for the discharge of all your obligations to
us, however arising and irrespective of the number of accounts you have with
us. We may require you to deposit additional collateral in accordance with
the rules and regulations of the Federal Reserve Board, the New York Stock
Exchange, the American Stock Exchange, and any other regulatory agency to
whose jurisdiction we are subject. In addition, we may require you to deposit
such additional collateral as we, in our sole discretion, determine is needed
as security for your obligation to us. Ordinarily, a request for additional
margin will be made when the equity in the account falls below 30 percent of
the market value of all marginable securities in the account (the equity is
the excess market value of the securities in the account over the loan or
debit balance).
Although we do not limit the factors which may cause us to require
additional margin, factors such as market fluctuation, high concentration or
the overall credit standing of the account will be considered. These margin
calls may be met by delivery of either additional marginable securities or
cash.
CORPORATE ACCOUNT AGREEMENT
EXHIBIT D
ADLER, COLEMAN & CO., INC.
20 Broad Street, New York, New York 10005 / (212) 422-9780
Florescue Family Corporation 49-501308 4902
CUSTOMER'S NAME ACCOUNT NUMBER
(AUTHORIZING TRADING IN SECURITIES AND PERMITTING
MARGIN TRANSACTIONS, OPTIONS AND SHORT SALES)
Gentlemen:
The undersigned Corporation, by, Barry Florescue, its President, pursuant to
resolutions of the BOARD OF DIRECTORS, a copy of which, certified by the
Secretary, is annexed hereto, hereby authorizes you to open an account in the
name of said Corporation; and the undersigned represent that no one other
than the undersigned has any interest in such account. The undersigned also
encloses herewith your Account Application, Margin Agreement/Loan Consent (if
applicable) and Options Agreement (if applicable) duly executed on behalf of the
Corporation. This authorization shall continue in force until revoked by the
undersigned Corporation by a written notice, addressed to you and delivered at
your office at 20 Broad Street, New York, N.Y.
Dated 11/23/93
--------------------------
Delray Beach, FL
--------------------------
(City) (State)
Very truly yours,
---------------------------------
By /s/
------------------------------
President
I, Mark Myers, being the Secretary of Florescue Family Corp., hereby certify
that the annexed resolutions were duly adopted at a meeting of the Board of
Directors of said Corporation, duly held on the 23 day of Nov., at which a
quorum of said Board of Directors was present and acting throughout and that
no action has been taken to rescind or amend said resolutions and that the same
are now in full force and effect.
I further certify that each of the following has been duly elected, is now
legally holding the office set opposite his name and the signature set opposite
his name is genuine.
Barry Florescue President
- ---------------------,
- ---------------------, Vice-President
- ---------------------, Treasurer
Mark Myers
- ---------------------, Secretary
I further certify that the said Corporation is duly organized and existing and
has the power to take the action called for by the resolutions annexed hereto.
IN WITNESS WHEREOF, I have hereunto affixed my hand this 23 day of Nov., 1993.
/s/ Mark Myers
-------------------------
Secretary
CERTIFIED COPY OF CERTAIN RESOLUTIONS ADOPTED BY THE BOARD OF
DIRECTORS WHEREBY THE ESTABLISHMENT AND MAINTENANCE
OF ACCOUNTS (WITH LIMITED AUTHORITY)
HAVE BEEN AUTHORIZED
RESOLVED--
FIRST: That the President or any Vice-President of this Corporation,
or or
be and they hereby are, and each of them hereby is, authorized and
empowered, for and on behalf of this Corporation (herein called the
"Corporation"), to establish and maintain one or more accounts, with
ADLER, COLEMAN & CO., INC. (herein called the "Brokers") and to deposit
funds in any of said accounts and to deliver to the Brokers for said
accounts any and all forms of securities (including within the meaning
of such term as used herein, but not by way of limitation, shares,
stocks, bonds, debentures, notes, script, participation certificates,
rights to subscribe, options, warrants, certificates of deposit,
mortgages, choses in action, evidences of indebtedness, commercial paper,
certificates of indebtedness and certificates of interest of any and
every kind and nature whatsoever, secured or unsecured, whether
represented by trust, participating and/or other certificates or
otherwise); to sell any and all forms of securities which may be in the
possession of the Brokers and which they may be carrying for the
Corporation in any of said accounts; and to buy any and all forms of
securities for the account of the Corporation.
The fullest authority at all times with respect to any such commitment
or with respect to any transaction deemed by any of the said officers
and/or agents to be proper in connection therewith is hereby conferred,
including authority (without limiting the generality of the foregoing)
to give written or oral instructions to the Brokers with respect to said
transactions; to bind and obligate the Corporation to and for the
carrying out of any contract, arrangement, or transaction, which shall
be entered into by any such officer and/or agent for and on behalf of
the Corporation with or through the Brokers; to pay in cash or by checks
and/or drafts drawn upon the funds of the Corporation such sums as may
be necessary in connection with any of the said accounts; to order the
transfer or delivery of securities to any other person whatsoever,
and/or to order the transfer of record of any securities to any name
selected by any of the said officers or agents; to affix the corporate
seal to any documents or agreements, or otherwise; to endorse any
securities in order to pass title thereto; to direct the sale or
exercise of any rights with respect to any securities; to sign for the
Corporation all releases, powers of attorney and/or other documents in
connection with any such account, and to agree to any terms or
conditions to control any such account; to direct the Brokers to
surrender any securities to the proper agent or party for the purpose of
effecting any exchange or conversion, or for the purpose of deposit with
any protective or similar committee, or otherwise; to accept delivery of
any securities; to appoint any other person or persons to do any and all
things which any of the said officers and/or agents is hereby empowered
to do, and generally to do and take all action necessary in connection
with the account, or considered desirable by such officer and/or agent
with respect thereto.
SECOND: That the Brokers may deal with any and all of the persons
directly or indirectly by the foregoing resolution empowered, as though
they were dealing with the Corporation directly.
THIRD: That the Secretary of the Corporation be and he hereby is
authorized, empowered and directed to certify, under the seal of the
Corporation, or otherwise to the Brokers:
(a) a true copy of these resolutions;
(b) specimen signatures of each and every person by these resolutions
empowered;
(c) a certificate (which, if required by the Brokers, shall be supported
by an opinion of the general counsel of the Corporation, or other
counsel satisfactory to the Brokers) that the Corporation is duly
organized and existing, that its charter empowered it to transact the
business by these resolutions defined, and that no limitation has been
imposed upon such powers by the By-Laws or otherwise.
FOURTH: That the Brokers may rely upon any certification given in
accordance with these resolutions, as continuing fully effective unless
and until the Brokers shall receive due written notice of a change in or
the rescission of authority as evidenced, and the dispatch or receipt of
any other form of notice shall not constitute a waiver of this
provision, nor shall the fact that any person hereby empowered ceases to
be an officer of the Corporation or becomes an officer under some other
title in any way affect the powers hereby conferred. The failure to
supply any specimen signature shall not invalidate any transaction if
the transaction is in accordance with authority actually granted.
FIFTH: That in the event of any change in the office or powers of
persons hereby empowered, the Secretary shall certify such changes to
the Brokers in writing in the manner hereinabove provided, which
notification, when received, shall be adequate both to terminate the
powers of the persons theretofore authorized, and to empower the persons
thereby substituted.
SIXTH: That the foregoing resolutions and the certificates actually
furnished to the Brokers by the Secretary of the Corporation pursuant
thereto, be and they hereby are made irrevocable until written notice of
the revocation thereof shall have been received by the Brokers.
(b) A statement of any of the undersigned's accounts shall be conclusive
and binding upon the undersigned if the undersigned does not object
thereto in writing within ten days after Adler Coleman has sent the
statement of account to the undersigned by mail or otherwise.
(c) Communications may be sent to the undersigned at the address of the
undersigned given in the Account Application or at such other address as
the undersigned may hereafter specify, and all communications so sent,
whether by messenger, mail, telegraph or other electronic means, shall
be deemed given to the undersigned personally, whether actually received
or not, on the date sent by messenger, telegraph or other electronic
means or three business days after mailed.
(d) Market prices appearing on a statement of account for purposes of
valuing the portfolio of the undersigned shall be used merely as a guide
and shall not be relied upon as, or deemed to be, accurate or correct.
9. Arbitration. o Arbitration is final and binding on the parties. o The
parties are waiving their right to seek remedies in court, including the
right to jury trial. o Pre-arbitration discovery is generally more limited
than and different from court proceedings. o The arbitrators' award is not
required to include factual findings or legal reasoning and any party's
right to appeal or to seek modification of rulings by the arbitrators is
strictly limited. o The panel of arbitrators will typically include a
minority of arbitrators who were or are affiliated with the securities
industry. The undersigned agrees and, by carrying an account for the
undersigned, Adler Coleman, and your broker agree, that except as
inconsistent with the foregong sentence, all controversies which may arise
between the undersigned and Adler Coleman and/or your broker concerning any
transaction or the constructions, performance or breach of this or any
other agreement between the undersigned and Adler Coleman and/or your
broker, whether entered into prior on or subsequent to the date hereof,
shall be determined by arbitration to be held in accordance with the rules
of the Board of Arbitration of The New York Stock Exchange, Inc., the rules
of The American Arbitration Association or the Code of Arbitration
Procedure of National Association of Securities Dealers Inc., whichever the
undersigned may select. If the undersigned does not make a selection by
registered or certified mail addressed to Adler Coleman or your broker at
its main office within five business days after Adler Coleman or your
broker shall have given notice to the undersigned requesting a selection,
Adler Coleman may make a selection on behalf of the undersigned. No
arbitration or other proceeding with respect to a controversy may be
commenced by the undersigned more than one year after the action or
omission upon which such controversy is based. If the undersigned shall by
any court proceeding be unsuccessful in resisting arbitration, the
undersigned shall reimburse Adler Coleman and your broker for all costs and
expenses (including attorneys' fees) incurred by them in connection with
such court proceeding. Any arbitration award shall be final, and judgment
on the award rendered may be entered in any court having jurisdiction.
10. Applicable Rules and Regulations. All transactions effected pursuant
to this Customer Agreement shall be subject to (i) the constitution,
by-laws, rules, regulations, customs and usages of the exchange or market
and its clearing house, if any, where such transactions are executed by
Adler Coleman or its agents, (ii) applicable federal, state and local
laws, rules and regulations and (iii) the constitution, by-laws, rules
and regulations of any securities self-regulatory authority to whose
jurisdiction Adler Coleman is subject, in each case whether now existing
or hereafter adopted or amended.
11. Governing Law. Except as provided in Section 10, this Customer
Agreement shall be governed by and construed in accordance with the laws
of the State of New York. The undersigned acknowledges that the
undersigned's Account Application has been submitted without
solicitation by Adler Coleman upon the understanding that neither it nor
any agreement related thereto shall be effective until they are accepted
by Adler Coleman in the State of New York.
12. Assignment. All agreements between the undersigned and Adler
Coleman and all instruments and other documents delivered by the
undersigned to Adler Coleman may be relied upon by, and shall inure to
the benefit of, Adler Coleman's successors and assigns. Adler Coleman
may transfer all of the undersigned's accounts to any such successor or
assign. This Agreement shall be binding upon the undersigned's personal
representative, heirs and assigns.
13. Capacity. The undersigned,if an individual, is of legal age. Neither
the undersigned nor the undersigned's spouse is (unless otherwise
indicated in the undersigned's Account Application) an employee of any
exchange, any corporation of which any exchange owns a majority of the
capital stock, any member firm or member corporation of any exchange, any
bank, trust company or insurance company or any corporation,
association, firm or individual engaged in the business of dealing,
either as a broker or principal, in securities, bills of exchange,
acceptances or other forms of commercial paper. The undersigned agrees
to promptly notify Adler Coleman in writing if either the undersigned or
the undersigned's spouse becomes so employed. If either the undersigned
or the undersigned's spouse is or becomes so employed, Adler Coleman
will not execute any transaction for the undersigned's account until
Adler Coleman has received written confirmation that the employer
is aware of the undersigned's account with Adler Coleman. Adler Coleman
will also notify the employer, prior to the execution of any transaction
for the undersigned's account, of the undersigned's intention to open or
maintain an account with Adler Coleman and, upon written request by the
employer, transmit to the employer duplicate copies of confirmations,
statements or other information with respect to the undersigned's
account. Except as otherwise indicated in the undersigned's Account
Application, no one other than the undersigned has or will have an
interest (other than any community property interest that the
undersigned's spouse may have under applicable law) in any account of
the undersigned with Adler Coleman.
14. Payments. No acceptance by Adler Coleman of a lesser sum than the
full amount due shall be deemed to be other than a payment on account,
and no endorsement or statement on any check or any letter accompanying any
check or payment shall be deemed to be an accord and satisfaction.
15. Joint Accounts. If the undersigned shall consist of more than one person,
the obligations and liabilities of each person with respect to any
account of the undersigned shall be joint and several.
16. Liability for Others. Adler Coleman shall not have any
responsibility or liability for any actions or omissions hereunder or
otherwise (i) of any agent selected by Adler Coleman with reasonable
care or (ii) of Adler Coleman or its employees unless such actions or
omissions constitute gross negligence or arose out of willful
misconduct. Without limiting the foregoing, Adler Coleman shall not be
liable for any loss or liability caused directly or indirectly by
governmental restrictions, exchange or market rulings, suspensions of
trading, interruptions in telecommunications services or facilities,
wars, strikes or other conditions beyond Adler Coleman's control.
17. Selection of Exchange or Market. Unless specifically instructed
otherwise, Adler Coleman is authorized to select the exchange or market
where all orders will be executed.
18. Inquiries. The undersigned authorizes Adler Coleman to furnish upon
request (i) to the broker of the undersigned all information relating to
the undersigned's accounts and (ii) to the issuer of securities the
undersigned's name, address and securities positions relating to the
securities of such issuer.
19. Termination. This Customer Agreement may be terminated by the
undersigned or Adler Coleman only by giving written notice to that effect
to the other of them. Notwithstanding any termination of this Customer
Agreement or any closing of any account of the undersigned, this
Customer Agreement shall remain in full force and effect with respect to
all actions and omissions occurring prior to such termination or
closing.
20. Implied Waivers. No action or inaction on the part of Adler Coleman
shall be deemed to be a waiver, continuing or otherwise, of its rights
or the undersigned's obligations hereunder or otherwise, unless such
waiver is set forth in a writing signed by Adler Coleman.
21. Disclosure Letter. The undersigned will not enter an order to trade or
carry any security until after the undersigned has received and reviewed a
letter entitled "Disclosure Statement Pursuant to SEC Approved Amendments
to New York Stock Exchange Rules 302 and 405 Effective February 19, 1982"
which described the agreement between your broker, as introducing broker,
and Adler Coleman, as carrying broker, and agrees to be bound by the
division of responsibilities reflected therein.
22. Miscellaneous.
(a) Free credit balances in any account of the undersigned with Adler
Coleman shall be maintained in such account solely for the purpose
of investing or reinvesting in securities and other property.
(b) All telephone calls with Adler Coleman shall be tape recorded.
(c) If any provision or condition of this Customer
Agreement shall be held to be invalid or unenforceable, such invalidity
or unenforceability shall attach only to such provision or condition and
all other provisions and conditions of this Customer Agreement shall
remain in full force and effect.
(d) Except as otherwise expressly provided herein, no waiver,
modification or amendment of any provision of this Customer Agreement
and no other agreement, document or instrument shall be effective
against or binding upon Adler Coleman unless it is contained in a
writing signed by Adler Coleman.
(e) This Customer Agreement shall be deemed to be automatically amended
with the consent of the undersigned, Adler Coleman, and your broker as
necessary to conform to the requirements of any exchange or market and
its clearing house, if any Securities and Exchange Commission, National
Association of Securities Dealers, Inc. and Securities Investor
Protection Corporation.
(f) All rights of Adler Coleman contained herein are in addition to any
other rights it may have at law, in equity or otherwise, and the exercise
of any such right shall not constitute a waiver of or a limitation on
Adler Coleman's right to exercise any such other right when and as it
may determine.
In consideration of Adler Coleman accepting a Margin Account of the
undersigned the undersigned understands and agrees that, in addition to
the provisions of the undersigned's Customer Agreement, the following
provisions apply:
1. Scope of Provisions. These provisions shall apply to all transactions
effected by Adler Coleman on margin in or for any account of the
undersigned and to all securities carried by Adler Coleman on margin in
or for any account of the undersigned.
2. Margin Requirements. The undersigned shall at all times maintain such
securities and/or cash in the accounts of the undersigned for margin
purposes as Adler Coleman shall require from time to time. Such
requirements may be stricter than those required by applicable laws,
rules and regulations.
3. Interest Charges on Debit Balances. The undersigned agrees to pay
interest on all debit balances in any of the undersigned's accounts with
Adler Coleman. Interest shall be computed and charged in accordance with
Adler Coleman's standard methods and procedures. Such methods and
procedures may be changed from time to time and at any time. Advance
notice of such change shall be given to the undersigned. Unless the
undersigned is notified in writing to the contrary, the interest rate
shall not exceed 1/2% above the "broker call rate" in effect from time
to time. In no event, however, shall the interest rate exceed the
maximum rate permitted by applicable law. Unpaid interest charges will
be added to the opening balance of the next computation period, which
means that the undersigned will be charged interest on interest due in
respect of a prior computation period.
4. Disclosure Statement. The undersigned will not enter an order to trade
or carry any securities on margin until after the undersigned has
received and reviewed the Initial Disclosure Statement required to be
furnished by Adler Coleman to the undersigned pursuant to the
Truth-In-Lending Rule adopted by the Securities and Exchange Commission.
5. Pledge of Securities. All securities now or hereafter carried by Adler
Coleman in or for any account of the undersigned may be pledged,
repledged, hypothecated, or re-hypothecated by Adler Coleman from time to
time without notice to the undersigned either separately or in common
with other securities for any amount due in the accounts of the
undersigned or for any greater amount, and Adler Coleman may do so
without retaining in its possession or under its control for delivery a
like amount of similar securities. Adler Coleman is hereby authorized to
lend, to itself as principal or otherwise, or to others any securities
held by Adler Coleman on margin for the account of, or under the control
of, the undersigned either separately or in common with other
securities, without notice to the undersigned.
6. Short Sales. The undersigned agrees to notify Adler Coleman either
directly or through your Broker of any "short" sale by the undersigned
at the time the order therefore is placed, and the undersigned hereby
authorizes Adler Coleman to mark any such order as being "short."
7. Liquidiation. If the equity in the undersigned's Margin Account falls below
the maintenance margin requirements established from time to time by Adler
Coleman, Adler Coleman shall be entitled to exercise any and all rights set
forth in the undersigned's Customer Agreement. Nothing contained
in this Section 7 shall be deemed to limit or restrict the circumstances
under which such rights may be exercised. Adler Coleman shall not be
liable to the undersigned for exercising any such rights if changes in
the market price or value of securities or open contract positions then
held in the undersigned's Margin Account would have alleviated the
maintenance margin deficiency.
The undersigned acknowledges that the undersigned has read, understands
and agrees to the terms of this Margin Agreement, and FURTHER
ACKNOWLEDGES THAT THE UNDERSIGNED'S SECURITIES MAY BE LOANED TO ADLER
COLEMAN OR LOANED OUT TO OTHERS.
x /s/ Barry Florescue, President 1/12/93 x
- ------------------------------------------ ---------------------------------
Signature (and Title, if applicable) Date Signature (if Joint Account) Date
CUSTOMER FINANCIAL STATEMENT/OPTION AGREEMENT
Note: This section should only be completed if you wish to trade
options. The information requested below is required by the rules and
regulations of the various designated option exchanges. The Options
Clearing Corporation and the National Association of Securities
Dealers, Inc.
EXHIBIT E
Florescue Family Corporation
701 Southeast 6th Avenue, Suite 204
Delray Beach, Florida 33483
March 7, 1995
The Board of Directors
of Marietta Corporation
37 Huntington Street
Cortland, NY 13045
Attention: Stephen D. Tannen, Chairman of the Board,
President and Chief Executive Officer
Dear Steve:
As you know from our recent conversations, I am very disappointed
in the conduct of the Board of Directors of Marietta Corporation (the "Company")
in light of recent developments. When we met in late January, 1995, I indicated
to you that as one of the Company's largest shareholders my principal interest
was, and the prime objective of the Board should be, the enhancement of
shareholder value. I suggested to you that there were alternatives available to
the Company to accomplish this objective and offered to provide assistance,
financial or otherwise.
Subsequent to our meeting, Dickstein Partners, Inc. and Calibre
Capital Advisors Inc. proposed to acquire the Common Stock of the Company for
$11 per share (the "Dickstein Proposal"). To date, the Company has not
responded to me or to the Dickstein Proposal. Instead, the Company appears to
continue to be operated without recognition of the important issues now facing
it and without regard to the impact of decisions on shareholders. This is very
troubling but perhaps not surprising since the members of the Board of
Directors, collectively, do not own even 150,000 shares of the outstanding
Common Stock.
Specifically, the Company has committed to make $6 million in
capital expenditures in the near term, twice the level of such expenditures
last year. The commitment for these capital expenditures has been made
notwithstanding the fact the Company has performed poorly and continues to lag
in sales and earnings. It is difficult to understand how doubling capital
expenditures is prudent or justified or benefits shareholders at this time. In
addition, the Company hired Goldman, Sachs & Co. and agreed to pay it a
The Board of Directors of Marietta Corporation
March 7, 1995
Page 2
minimum of $1.5 million. I concur with Mr. Dickstein in questioning the
wisdom of hiring Goldman, Sachs and agreeing to pay Goldman, Sachs what
equates to 67% of the Company's earnings for the last four quarters and
over 3% of the Company's net worth. Taken together these actions could lead
one to conclude that the Company's Board of Directors is insensitive to the
interests of shareholders and is merely taking steps to reduce the
Company's attractiveness and financial options, to the detriment of
shareholders.
Given the recent conduct of the Board of Directors and its lack of an
ownership interest in the Company, I believe it is apparent that this Board is
unable or unwilling to deal with the Dickstein Proposal or other alternatives
in a manner which will enhance shareholder value. I therefore demand that the
Company immediately expand the Board of Directors to include representatives of
substantial equity owners so that the Board, as reconsitituted, can consider the
important issues facing the Company from the shareholders' perspective. I also
demand that you set a date for your annual meeting of shareholders as soon as
reasonably practicable. The failure of the Board to set such a meeting is simply
another indication of the attempt by the Board to entrench itself.
Sincerely,
FLORESCUE FAMILY CORPORATION
By: /s/ Barry Florescue
Name: Barry Florescue
Title: President
EXHIBIT F
PERSONAL AND CONFIDENTIAL
May 17, 1995
Florescue Family Corporation
701 Southeast 6th Avenue, Suite 204
Delray Beach, Florida 33483
Attention: Barry W. Florescue
Gentlemen:
In connection with your consideration of a possible transaction with Marietta
Corporation (the "Company"), you have requested information concerning the
Company. As a condition to your being furnished such information, you agree to
treat any information concerning the Company (whether prepared by the Company,
its advisors or otherwise) which is furnished to you by or on behalf of the
Company (herein collectively referred to as the "Evaluation Material") in
accordance with the provisions of this letter and to take or abstain from
taking certain other actions herein set forth. The term "Evaluation Material"
does not include information which (i) is already in your possession, provided
that such information is not known by you to have been obtained in violation of
another confidentiality agreement with or other obligation of secrecy to the
Company or another party, (ii) becomes generally available to the public other
than as a result of a disclosure by you or your directors, officers,
employees, agents, lenders or advisors, or (iii) becomes available to you on a
nonconfidential basis from a source other than the Company or its advisors,
provided that such source is not known by you to be bound by a confidentiality
agreement with or other obligation of secrecy to the Company or another party.
You hereby agree that the Evaluation Material will be used solely for the
purpose of evaluating a possible transaction between the Company and you, and
that such information will be kept confidential by you and your advisors and
institutional lenders; provided, however, that (i) any of such information may
be disclosed to your directors, officers and employees and
representatives of your advisors and lenders who need to know such information
for the purpose of evaluating any such possible transaction between the Company
and you (it being understood that such directors, officers, employees and
representatives shall be informed by you of the confidential nature of such
information and shall be directed by you to treat such information
confidentially), (ii) any disclosure of such information may be made to which
the Company consents in writing, (iii) any disclosure of such information may be
made if, in the good faith opinion of outside counsel to the party making such
disclosure, such disclosure is required by an order or other directive of a
court or governmental body or agency requiring such disclosure, in which event
you shall notify the Company in advance of such disclosure and cooperate with
the Company's efforts to ensure the confidentiality of such information.
You hereby acknowledge that you are aware, and that you will advise such
directors, officers, employees and representatives who are informed as to the
matters which are the subject of this letter, that the United States securities
laws prohibit any person who has received from an Issuer material, non-public
information concerning the matters which are the subject of this letter from
purchasing or selling securities of such Issuer or from communicating such
information to any other person under circumstances in which it is reasonably
foreseeable that such person is likely to purchase or sell such securities.
In addition, except as outside counsel may advise is required by law, without
the prior written consent of the Company, you will not, and will direct such
directors, officers, employees and representatives not to, disclose to any
person either the fact that discussions or negotiations are taking place
concerning a possible transaction between the Company and you or any of the
terms, conditions or other facts with respect to any such possible transaction,
including the status thereof.
Although the Company has endeavored to include in the Evaluation Material
information known to it which it believes to be relevant for the purpose of
your investigation, you understand that neither the Company nor any of
its representatives or advisors have made or make any representation or
warranty as to the accuracy or completeness of the Evaluation Material.
You agree that neither the Company nor its representatives or advisors
2
shall have any liability to you or any of your representatives, lender
or advisors resulting from the use of the Evaluation Material.
In the event that you do not proceed with the transaction which is the
subject of this letter within a reasonable time, you shall promptly
redeliver to the Company all written Evaluation Material and any other
written material containing or reflecting any information in the Evaluation
Material (whether prepared by the Company, its advisors or otherwise) and
will not retain any copies, extracts or other reproductions in whole or in
part of such written material. All documents, memoranda, notes and other
writings whatsoever prepared by you or your advisors or lenders based
on the information in the Evaluation Material shall be destroyed, and such
destruction shall be certified in writing to the Company by an authorized
officer supervising such destruction.
You agree that unless and until a definitive agreement between the Company
and you with respect to any transaction referred to in the first paragraph
of this letter has been executed and delivered, neither the Company nor you
will be under any legal obligation of any kind whatsoever with respect to
such a transaction by virtue of this or any written or oral expression with
respect to such a transaction by any of its directors, officers, employees,
agents or any other representatives or its advisors or representatives
thereof except, in the case of this letter, for the matters specifically
agreed to herein. The agreement set forth in this paragraph may be
modified or waived only by a separate writing by the Company and you
expressly so modifying or waiving such agreement.
This letter shall be governed by, and construed in accordance with, the
laws of the State of New York.
Very truly yours,
MARIETTA CORPORATION
By: /s/ Goldman, Sachs & Co.
--------------------------
Goldman, Sachs & Co.
on behalf of Marietta Corporation
3
Confirmed and Agreed to:
FLORESCUE FAMILY CORPORATION
By: /s/ Barry Florescue, President
-------------------------------
Barry Florescue, President
4
EXHIBIT G
DABNEY
- -------
RESNICK
INCORPORATED
150 SOUTH RODEO DRIVE, SUITE 100, BEVERLY HILLS, CA 90212
310-246-3700 800-929-2299 FAX 310-246-3794
May 22, 1995
Florescue Family Corporation
701 S.E. 6th Avenue
Delray Beach, FL 33483
ATTN: Barry Florescue
President
Gentlemen:
This letter confirms our understanding that Florescue Family Corporation
(which together with its subsidiaries and affiliates is hereinafter
referred to as the "Company") has engaged Dabney/Resnick, Inc. ("D/R")
to act as exclusive financial advisor to the Company with respect to the
possible acquisition of Marietta Corporation ("Marietta" or the
"Target"), through a subsidiary to be formed for the purposes of an
acquisition ("Newco"), in one or a series of transactions, by merger,
consolidation or any other business combination, in one or a series of
transactions, by purchase involving all or a substantial amount of the
business, securities or assets of the Target, or any transaction which
is structured to substantially achieve the same result (each a
"Transaction"), and the private placement of (i) approximately $10.0
million of debt securities (the "Notes"), (ii) a revolving credit and
term facility of approximately $35.0 million (the "Revolver and Term
Facility"), (iii) approximately $4.0 million of equity securities (the
"Equity") and (iv) warrants to purchase up to 15.0% of the issued and
outstanding common stock of Newco, on a fully diluted basis (the
"Warrants"; and together with the Notes, the Revolver and Term Facility
and the Equity, the "Financing").
Section 1. Services to be Rendered. In connection with this engagement,
D/R agrees to undertake certain services on your behalf including, to
the extent requested by you: (i) assisting you in evaluating the Target;
(ii) advising on a proposed purchase price and form of consideration;
(iii) structuring a Transaction; and (iv) negotiating the financial
aspects of any Transaction under your guidance. With respect to
the proposed Financing, D/R's services to the Company will include: (i)
assistance in the preparation of a private placement memorandum
describing the Company and the Target, its operations, its historical
performance and its future prospects (the "Offering Materials"); (ii)
assistance in structuring the proposed Financing and its terms; (iii)
identifying and contacting selected qualified purchasers (the
"Purchasers") of the proposed Financing and furnishing them, on behalf of
the Company with copies of the Offering Materials; and (iv) negotiating
the financial aspects of the proposed Financing under your guidance.
Nothing contained herein constitutes a commitment on the part of D/R to
purchase any securities.
The Company acknowledges and agrees that D/R has been retained solely
to provide the advice or services set forth in this Agreement. D/R shall
act as an independent contractor, and any duties of D/R arising out of its
engagement hereunder shall be owed solely to the Company. As D/R will be acting
on your behalf, the Company agrees to the indemnification and other
obligations set forth in Schedule I attached hereto, which Schedule is an
integral part hereof and incorporated by reference herein.
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 2
Section 2. Compensation. As compensation for services to be provided
by D/R hereunder, Newco agrees to pay to D/R (i) a cash fee in an amount
equal to 1.0% of the aggregate amount of consideration received by the
Target and/or its shareholders (including the consideration paid with
respect to the exercise or termination of options, warrants or other
rights of conversion) and including in such consideration the amount of
any debt securities assumed or preferred stock redeemed in connection
with a Transaction, payable in cash promptly upon consummation of a
Transaction; (ii) a cash fee equal to 4.0% of the principal amount of
the Notes sold upon consummation of, and out of the proceeds of, the
proposed Financing; (iii) a cash fee equal to 1.5% of the aggregate
committed amount of the Revolver and Term Facility, less any such cash
fee payable to the provider of the Revolver and Term Facility (provided
that this fee shall not be less than zero), upon consummation of, and
out of the proceeds of, the proposed Financing; (iv) a cash fee equal to
5.0% of the aggregate dollar amount of Equity sold upon consummation of,
and out of the proceeds of, the proposed Financing; and (v) a warrant
(in addition to, and on the same terms as, the Warrants) to purchase
5.0% of the issued and outstanding common stock of Newco on a fully
diluted basis. Upon request by D/R from time to time, the Company agrees
to reimburse D/R promptly for all out-of-pocket expenses (including
without limitation all reasonable fees and expenses of counsel) incurred
by D/R in connection with this engagement hereunder. Further, the
Company will be responsible for all other expenses associated with the
placement of the Financing, including, but not limited to, its own
accounting and reasonable legal fees, printing and travel costs, and
legal costs of the investors. Reimbursement of out-of-pocket expenses
will be paid to D/R promptly by the Company whether or not the proposed
Financing is consummated. D/R will be paid a cash deposit of $25,000
upon execution of this Agreement to be used to reimburse D/R for its
out-of-pocket expenses and any unused amounts will be returned to the
Company upon demand.
In the event that the consideration in a Transaction is paid in whole
or in part in the form of securities or other assets, the value of such
securities or other assets, for the purposes of calculating D/R's fee,
shall be the fair market value thereof, as the parties hereto shall
mutually agree, on the day prior to the consummaton of the Transaction;
provided that, if such consideration includes securities with an
existing public trading market, the value thereof shall be determined by
the last sales price for such securities on the last trading day thereof
prior to such consummation.
A Transaction shall be deemed to have been consummated upon the
earliest of any of the following events to occur: (1) the acquisition of
a majority of the outstanding common stock of the Target by the Company
calculated on a fully diluted basis; provided, however, that the
compensation to be paid in accordance with Section 2 with respect to
this subparagraph (i) shall be paid pro rata based upon the number of
shares of common stock of the Target then acquired; (ii) a merger or
consolidation of the Target with or into the Company or an affliate of
the Company; (iii) the acquisition by the Company of substantially all
of the Target's assets; or (iv) in the case of any other Transaction,
the consummation thereof. The proposed Financing shall be deemed to have
been consummated upon the closing thereof.
In the event that a letter of intent or a definitive agreement is
reached between the Company and the Target, and the Company, for any
reason, is paid a break-up fee, topping fee or any other termination
fee, D/R will be entitled to and paid the lesser of (a) $250,000 or (b)
25.0% of said fee.
Should a Transaction not occur subsequent to the executon of this
Agreement and the Company sells, exchanges or otherwise disposes of some
or all of its shares in Target, to an unaffiliated third party or in the
open market (collectively, a "Sale"), or should Target consummate a
transaction with another party or complete a restructuring, leveraged
buyout, or similar transaction (collectively, a "Target Transaction"),
the Company shall pay to D/R an amount equal to 10% of the Net Profit
earned over $13.00 on each share sold or exchanged or otherwise disposed
of; provided, however, that such payment,
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 3
if due, shall not be less than $50,000.00 (fifty thousand dollars and 00
cents) in the aggregate. For the purposes of this engagement, "Net
Profit" is defined as the aggregate consideration received per share by
the Company in a Sale or pursuant to a Target Transaction plus any
dividends received and any expenses reimbursed, minus the following
related cost items divided by the aggregate number of shares transferred
in a Sale or pursuant to a Target Transaction by the Company: (i) the
aggregate purchase price of Target common stock by the Company; (ii)
legal fees and expenses incurred by the Company; (iii) all fees paid to
D/R; (iv) interest costs actually paid by the Company on any borrowings
utilized to purchase or carry the shares; (v) commitment and other
financing fees paid to others, including senior lenders, and
reimbursement for out-of-pocket expenses, if paid; (vi) Securities and
Exchange Commission filing fees; and (vii) printer and printing charges.
In the event that the consideration received in a Sale or Target
Transaction is not all cash, the non-cash portion (including any common
equity retained in a Target Transaction) shall be valued at its fair
market value as of the date of receipt and any publicly traded common
equity held by the Company following a Target Transaction shall be
valued at its closing price on the first day of ex-dividend (or
ex-transaction, as appropriate) trading.
Section 3. Term of Engagement. This Agreement may be terminated by
either party hereto upon 2 days of written notice. Upon any termination
or expiration of this Agreement, D/R will be entitled to prompt payment
of all fees accrued prior to such termination or expiration and
reimbursement of all out-of-pocket expenses as described above. Sections
2, 3, 5, 6, 9 and 10 of this Agreement and the indemnity and other
provisions contained in Schedule I will also remain operative and in
full force and effect regardless of any termination or expiration of
this Agreement.
In addition, if at any time prior to 12 months after the termination or
expiration of this Agreement the Company enters into a financing
transaction or transactions relating to the Target with proposed
Purchasers introduced to the Company by D/R, D/R, in addition to any fee
and expense reimbursement otherwise owing pursuant to Section 2 of this
Agreement, shall be entitled to payment in full of the compensation
described in Section 2 of this Agreement with respect to such financing
transaction or transactions.
Without limitation to the foregoing paragraph, it is understood that if
the Company completes a transaction in lieu of the proposed Financing for
which an advisor or agent would customarily be entitled to compensation,
D/R and the Company will in good faith mutually agree upon acceptable
compensation for D/R.
Section 4. Cooperation. The Company will furnish D/R with all financial
and other information and data as D/R believes appropriate in connection
with its activities on the Company's behalf, and shall provide D/R full
access to its officer, director and professional advisors. In addition,
the Company will be responsible for preparing Offering Materials
relating to the proposed Financing. The Company authorizes D/R to
transmit the Offering Materials to prospective Purchasers of the
proposed Financing, and represents and warrants that, subject to the
last sentence of this paragraph, the Offering Materials, at all times
through the closing, will not contain any untrue statement of material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading. The Company
will promptly notify D/R if it learns of any material inaccuracy or
misstatement in, or material omission from, any information theretofore
delivered to D/R.
The Company recognizes and confirms that D/R, in connection with
performing its services hereunder, (i) will be relying without
investigation upon all information that is available from public sources
relating to the Target or supplied to it by or on behalf of the Company
or its advisors, (ii) shall not
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 4
in any respect be responsible for the accuracy or completeness of, or
have any obligation to verify, the same, (iii) will not conduct any
appraisal of any assets of the Company and (iv) may require that the
Offering Materials contain appropriate disclaimers consistent with the
foregoing.
Section 5. Confidentiality. The Company agrees that any advice, written
or oral, provided by D/R pursuant to this Agreement will be treated by
the Company as confidential, will be solely for the information and
assistance of the Company in connection with its consideration of a
transaction of the type referred to in Section 1 of this Agreement and
will not, except as required by law, be used, circulated, quoted or
otherwise referred to for any other purpose, nor will it be filed with,
included in or referred to, in whole or in part, in any registration
statement, proxy statement or any other communication, whether written
(including, without limitation, the Offering Materials) or oral,
prepared, issued or transmitted by the Company or any affiliate,
director, officer, employee, agent or representative of any thereof,
without, in each instance, D/R's prior consent, which consent shall not
be unreasonably withheld.
Further, in connection with this engagement of D/R,it is contemplated
that the Company may supply to D/R certain non-public or proprietary
information concerning the Company ("Confidential Information"). D/R
shall use Confidential Information solely for the purposes of rendering
services pursuant to and in accordance with this engagement and shall
not, without the prior written consent of the Company, disclose any
Confidential Information to any person, other than its officers,
directors, employees and outside advisors with a need to know; provided,
however, that the foregoing shall not apply to any information which
becomes publicly available other than as a result of the breach of D/R's
undertakings hereunder, or that which D/R is required to disclose by
judicial or administrative process in connection with any action, suit,
proceeding or claim.
Section 6. Conflicts. The Company acknowledges that D/R and its
affiliates may have and may continue to have investment banking and
other relationships with parties other than the Company pursuant to which
D/R may acquire information of interest to the Company. D/R shall have no
obligation to disclose such information to the Company, or to use such
information in connection with any contemplated transaction. No one
other than the Company is authorized to rely upon the engagement of D/R
hereunder or any statements, advice, opinions or conduct by D/R.
Section 7. Exclusivity. The Company agrees that no other financial
advisor is or will be authorized by it during the term of this Agreement
to perform services on its behalf of the type which D/R is authorized to
perform hereunder. No fee payable to any other financial advisor either
by the Company or any other entity shall reduce or otherwise affect the
fees payable hereunder to D/R.
Section 8. Public Announcements. D/R shall have the right to place
announcements and advertisements in financial and other newspapers and
journals, at its own expense, describing its services in connection with
the Financing, provided that D/R obtains the Company's prior written
consent, which consent will not be unreasonably withheld.
Section 9. Complete Agreement; Severability; Amendments; Assignment.
This Agreement embodies the entire agreement and understanding between
the parties hereto and supersedes any prior agreements and
understandings relating to the subject matter hereof. If any provision of
this Agreement is determined to be invalid or unenforceable in any
respect, such determination will not affect such provision in any other
respect or any other provision of this Agreement, which will remain in
full force and effect. This Agreement may not be amended or otherwise
modified or waived except by an instrument in writing signed by both D/R
and the Company. This Agreement may not be assigned by either party
without the prior written consent of the other party.
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 5
This Agreement shall be binding upon and inure to the benefit of the
Company, D/R, each Indemnified Person (as defined in Schedule I hereto) and
their respective successors and assigns.
Section 10. Governing Law; Forum. This Agreement will be governed by,
and construed in accordance with, the laws of the state of Florida
applicable to agreements made and to be performed entirely in such state.
Each of the Company and D/R agree that any action or proceeding based
hereon, or arising out of D/R's engagement hereunder, shall be brought and
maintained exclusively in the courts of the state of Florida or in the
United States District Court for the District of Florida. The Company and
D/R each hereby irrevocably submit to the jurisdiction of the courts of the
state of Florida and of the United States District Court for the District
of Florida for the purpose of any such action or proceeding as set forth
above and irrevocably agree to be bound by any judgment rendered thereby in
connection with such action or proceeding. Each of the Company and D/R
hereby irrevocably waive, to the fullest extent permitted by law, any
objection which it may have or hereafter may have to the laying of venue
of any such action or proceeding brought in any such court referred to
above and any claim that any such action or proceeding has been brought in
an inconvenient forum. The Company (for itself, anyone claiming through it
or its name, and on behalf of its equity holders) and D/R each hereby
irrevocably waive any right they may have to a trial by jury in respect to
any claim based upon or arising out of this Agreement or the proposed
Financing contemplated hereby.
Please confirm that the foregoing correctly sets forth our agreement by
signing and returning to D/R the enclosed original copy of this Agreement.
Very truly yours,
DABNEY/RESNICK, INC.
By: /s/ Richard Bloom
----------------------------
Richard Bloom
Senior Vice President
Accepted as of the date
written above.
FLORESCUE FAMILY CORPORATION
By: /s/ Barry Florescue
-------------------------
Barry Florescue
President
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 6
Schedule I
This Schedule I is a part of and is incorporated into that certain
letter agreement (together, the "Agreement") dated May 22, 1995 by and
between Florescue Family Corporation (the "Company") and
Dabney/Resnick, Inc. ("D/R").
This letter will confirm that the Company agrees to indemnify and hold
harmless Dabney/Resnick, Inc., ("D/R") and its affiliates, the
respective directors, officers, attorneys and other agents, stockholders
and employees of D/R and its affiliates and each other person, if any,
controlling D/R or any of its affiliates (D/R and each such person and
entity being referred to as an "Indemnified Person"), to the full extent
lawful, from and against any losses, claims, damages or liabilities or
actions (including without limitation shareholder actions and actions
arising from the use of information contained in the Offering Materials
or omissions from such materials) relating to or arising out of this
engagement or D/R's role in connection herewith, and will pay (or, if
paid by an Indemnified Person, reimburse such Indemnified Person) for
all fees and expenses (including without limitation counsel fees)
incurred by such Indemnified Person in connection with investigating,
preparing or defending any such action or claim, whether or not in
connection with pending or threatened litigation in which any
Indemnified Person is a party. The Company will not, however, be
responsible for any claims, liabilities, losses, damages or expenses
which result from any compromise or settlement not approved by the
Company or which result primarily from the fraud, willful misconduct or
gross negligence of any Indemnified Person. The Company also agrees that
no Indemnified Person shall have any liability to the Company for or in
connection with this engagement, except for any such liability for
losses, claims, damages, liabilities or expenses incurred by the Company
that result from the fraud, willful misconduct or gross negligence of
the Indemnified Person. The foregoing agreement shall be in addition to
any rights that any Indemnified Person may have at common law or
otherwise, including without limitation any right to contribution.
Except as required by law, the Company's agreement to indemnify D/R and
other Indemnified Persons pursuant to this letter shall not be disclosed
publicly or made available to third parties by either party hereto
without the other party's prior written consent.
If any action or proceeding is brought against any Indemnified Person in
respect of which indemnity may be sought against the Company pursuant
hereto, or if any Indemnified Person receives notice from any potential
litigant or a claim which such person reasonably believes will result in
the commencement of any such action or proceeding, such Indemnified
Person shall promptly notify the Company in writing of the commencement
of such action or proceeding, or of the existence of any such claim, but
the failure so to notify the Company of any such action or proceeding
shall not relieve the Company from any other obligation or liability
which it may have to any Indemnified Person otherwise than under this
Agreement or with respect to any other action or proceeding except where
the failure to so notify the Company results in a forfeiture of
substantial rights by the Company. In case any such action or proceeding
shall be brought against any Indemnified Person, the Company shall be
entitled to participate in such action or proceeding with counsel of
the Company's choice, or compromise or settle such action or proceeding,
at its expense (in which case the Company shall not thereafter be
responsible for the fees and expenses of any separate counsel retained
by such Indemnified Person); provided, however, that such counsel shall
be satisfactory to the Indemnified Person in the exercise of its
reasonable judgment. Notwithstanding the Company's election to assume
the defense of such action or proceeding, such Indemnified Person shall
have the right to employ separate counsel and to participate in the
defense of such action or proceeding, and the Company shall bear the
reasonable fees, costs and expenses of such separate counsel provided,
that the Company shall not be responsible for the payment of fees, costs
and expenses of more than one firm of attorneys (in addition to local
counsel) and shall pay such fees, costs and expenses at least quarterly,
if (a) the use of counsel chosen by the Company to represent such
Barry Florescue
President
Florescue Family Corporation
May 22, 1995
Page 7
Indemnified Person would, in the judgment of the Indemnified Person,
present such counsel with a conflict of interest; (b) the defendants in,
or targets of, any such action or proceeding include both an Indemnified
Person and the Company, and such Indemnified Person shall have
reasonably concluded that there may be legal defenses available to it or
to other Indemnified Persons which are different from or additional to
those available to the Company (in which case the Company shall not
have the right to direct the defense of such action or proceeding on
behalf of the Indemnified Person); (c) the Company shall not have
employed counsel satisfactory to such Indemnified Person in the exercise
of the Indemnified Person's reasonable judgment to represent such
Indemnified Person within a reasonable time after notice of the
institution of such action or proceeding; or (d) the Company shall
authorize such Indemnified Person to employ separate counsel at the
Company's expense.
In order to provide for the just and equitable contribution, if a
claim for indemnification hereunder is found unenforceable in a final
judgment by a court of competent jurisdiction (not subject to further
appeal), even though the express provisions hereof provide for
indemnification in such case, then the Company and D/R shall contribute
to the losses, claims, damages, judgments, liability or costs to which
the Indemnified Person may be subject in accordance with the relative
benefits received by, and the relative fault of, each in connection with
the statements, acts or omissions which resulted in such losses, claims,
damages, judgments, liabilities, or costs. No person found liable for a
fraudulent misrepresentation or omission shall be entitled to
contribution from any person who is not also found liable for such
fraudulent misrepresentation or omission. Notwithstanding the foregoing,
D/R shall not be obligated to contribute to any amount hereunder that
exceeds the amount of fees previously received by D/R for its services
to the Company.
These indemnification provisions shall (i) remain operative and in
full force and effect regardless of any termination or completion of the
engagement of D/R; (ii) inure to the benefit of any successors, assigns,
heirs or personal representative of any Indemnified Person; and (iii) be
in addition to any other rights that any Indemnified Person may have.
