Exhibit 99.(c)(2)
EXHIBIT A
INDUCEMENT AGREEMENT
This Inducement Agreement (the "Agreement"), dated as of January 19,
1999, by and among United Information Acquisition Corp., a Delaware corporation
("Acquisition"), and the stockholders listed on the signature page hereof (each
such stockholder being referred to herein as a "Stockholder" and, collectively
with each other Stockholder, the "Stockholders").
W I T N E S S E T H
WHEREAS, each Stockholder is the sole record and beneficial owner of,
and has the sole right to vote with respect to, the number of shares of common
stock, par value $.01 per share ("Shares") of Audits & Surveys Worldwide, Inc.,
a Delaware corporation ("Audits") set forth opposite the name of such
Stockholder on Schedule A hereto;
WHEREAS, in reliance upon the execution and delivery of this Agreement,
United News & Media Group Limited, an English limited company and affiliate of
Acquisition ("Group Ltd."), and Acquisition will enter into an Agreement and
Plan of Merger dated as of the date hereof (the "Merger Agreement"), with Audits
pursuant to which, among other things, Acquisition will commence a tender offer
(as modified from time to time as permitted by the Merger Agreement, the
"Offer") for all of the outstanding Shares at a price of $3.24 per share, and
Acquisition will be merged with and into Audits (the "Merger"), on the terms and
subject to the conditions contained in the Merger Agreement; and
WHEREAS, in order to induce Acquisition and Group Ltd. to enter into
the Merger Agreement and to incur the obligations set forth therein, the
Stockholders are entering into this Agreement pursuant to which each Stockholder
is (i) agreeing to tender such Stockholder's Option Shares in accordance with
the terms of the Offer, (ii) granting an irrevocable proxy to Acquisition to
vote in favor of the Merger and to make certain agreements with respect to such
Stockholders' Shares, and (iii) granting an option to Acquisition to purchase
such Stockholder's Option Shares, all upon the terms and conditions set forth
herein.
NOW THEREFORE, for and in consideration of the foregoing and the mutual
promises contained herein, and upon and subject to the terms and conditions set
forth below, the parties hereto agree as follows:
SECTION 1. GRANT OF IRREVOCABLE PROXY. Each Stockholder hereby
irrevocably appoints and constitutes Acquisition or any designee of Acquisition,
with full power of substitution, the lawful agent, attorney and proxy of the
Stockholder (each an "Irrevocable Proxy") during the term of this Agreement to
vote in its sole discretion the number of Shares specified in Schedule A hereto
(such Shares, together with any Shares which such Shareholder acquires after the
date hereof, being
the "Option Shares") in the following manner for the following purposes: (i) to
call one or more meetings of the stockholders of Audits in accordance with the
By-Laws of Audits and applicable law for the purpose of considering the
transactions contemplated by the Merger Agreement such that the stockholders
shall have the full opportunity to approve the Merger Agreement and any and all
amendments, modifications and waivers thereof and the transactions contemplated
thereby; (ii) in favor of the Merger Agreement or any of the transactions
contemplated by the Merger Agreement at any stockholders' meetings of Audits
held to consider the Merger Agreement (whether annual or special and whether or
not an adjourned meeting); (iii) against any other proposal for any
recapitalization, merger, sale of assets or other business combination between
Audits and any other person or entity other than Acquisition or the taking of
any action which would result in any of the conditions to Acquisition's
obligations under the Merger Agreement not being fulfilled; and (iv) as
otherwise necessary or appropriate to enable Acquisition to consummate the
transactions contemplated by the Merger Agreement and, in connection with such
purposes, to otherwise act with respect to the Shares which the Stockholder is
entitled to vote. THIS IRREVOCABLE PROXY HAS BEEN GIVEN IN CONSIDERATION OF THE
UNDERTAKINGS OF ACQUISITION AND Group Ltd. IN THE MERGER AGREEMENT AND SHALL BE
IRREVOCABLE AND COUPLED WITH AN INTEREST UNTIL THE IRREVOCABLE PROXY TERMINATION
DATE AS DEFINED IN SECTION 2 HEREOF. This Agreement shall revoke all other
proxies granted by the Stockholders with respect to their Option Shares.
SECTION 2. IRREVOCABLE PROXY TERMINATION DATE. This Irrevocable Proxy
shall expire on the earlier to occur of the closing of the Offer or the
termination of the Merger Agreement pursuant to its terms (in either case, the
"Merger Termination Date").
SECTION 3. GRANT OF OPTION. Subject to the conditions herein set forth,
each Stockholder hereby grants to Acquisition an irrevocable option (the
"Option") to purchase such Stockholder's Option Shares at $3.24 per share
(subject to adjustment as provided in Section 5 below), expiring on the earlier
to occur of the closing of the Offer or the termination of the Merger Agreement
pursuant to its terms (the "Expiration Date").
SECTION 4. EXERCISE AND CLOSING OF OPTION. Acquisition may exercise the
Option by delivery of written notice of exercise to each Stockholder, binding
Acquisition to purchase such Stockholders' Option Shares on terms set forth
herein, signed by an officer of Acquisition, to such Stockholder at the
executive offices of Audits in New York, New York, prior to the Expiration Date.
The closing of the purchase and sale of the Option Shares shall occur at the
offices of Xxxxxx, Xxxxxxx & Xxxxxxx in New York, New York, at 10 a.m. on the
second business day following the delivery of the notice of exercise of the
Option. At such Closing, each Stockholder shall deliver certificates
representing such Stockholder's Option Shares endorsed for transfer to
Acquisition, subject to any applicable restrictions as to transferability under
the Securities Act of 1933, against delivery to such Stockholder of a certified
check or wire transfer of the purchase price therefor, payable in funds good on
the date of such delivery. Notwithstanding anything to the contrary contained in
this Agreement, Acquisition may exercise the Option only in the event of a
Superior
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Proposal (as said term is defined in the Merger Agreement) or of a willful and
intentional breach of the Merger Agreement by Audits.
In the event that Acquisition exercises the Option and the closing of
the purchase and sale of the Option Shares occurs pursuant to this Section 4,
Acquisition and Group Ltd. agree (a) not to terminate the Offer and (b) to
consummate the purchase of all Shares tendered (and not withdrawn) pursuant to
the Offer whether or not all of the conditions contained in Annex 1 to the
Merger Agreement have been satisfied.
SECTION 5. ADJUSTMENT TO PURCHASE PRICE. In the event Acquisition (or
any affiliate of Acquisition) shall at any time prior to the Expiration Date of
the Option (whether or not the Option shall have been exercised prior thereto)
purchase or offer to purchase any Shares at a price or prices higher than $3.24
per share, then (i) if any Option has not been exercised prior to such purchase
or purchases or offer or offers, the price at which such Options may thereafter
be exercised shall automatically be increased to the highest such price, or,
(ii) if any Option has been exercised prior to any such purchase or purchases,
Acquisition shall pay to each Stockholder with respect to which the Option was
exercised, promptly after the Expiration Date, an additional sum equal to the
difference between the price at which it exercised the Option and the price it
would have been required to pay to exercise the Option if it had exercised the
Option immediately prior to the Expiration Date.
SECTION 6. AGREEMENT TO TENDER. Each Stockholder hereby agrees that, if
Acquisition commences the Offer, such Stockholder will tender, or cause to be
tendered, such Stockholder's Option Shares to Acquisition as soon as practicable
(and in any event within five business days) after the commencement of the Offer
in accordance with the terms and conditions of the Offer. Each Stockholder
further agrees that he will not withdraw such tendered Option Shares unless the
Offer is terminated by Acquisition.
SECTION 7. COVENANTS OF THE STOCKHOLDERS. Each Stockholder covenants
and agrees for the benefit of Acquisition that, until the Merger Termination
Date, he/she will not:
(a) sell, transfer, pledge, hypothecate, encumber, assign,
tender or otherwise dispose of, or enter into any contract, option or other
arrangement or understanding with respect to the sale, transfer, pledge,
hypothecation, encumbrance, assignment, tender or other disposition of, any of
his Shares or any interest therein;
(b) other than as expressly contemplated by this Agreement,
grant any powers of attorney or proxies or consents in respect of any of such
Stockholder's Option Shares, deposit any of such Shares into a voting trust,
enter into a voting agreement with respect to any of such Shares or otherwise
restrict or take any action adversely affecting the ability of such Stockholder
freely to exercise all voting rights with respect thereto; or
(c) directly or indirectly through his or her agents and
representatives, initiate, solicit or encourage, any inquiries or the making or
implementation of any alternative proposal (an
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"Alternative Proposal") to acquire the Shares or engage in any negotiations
concerning, or provide any confidential information or data to, or have any
discussions with, any person relating to an Alternative Proposal, or otherwise
facilitate any effort or attempt to make or implementation Alternative Proposal;
and such Stockholder shall (i) immediately cease and cause to be terminated any
existing activities, including discussions or negotiations with any parties,
conducted heretofore with respect to any of the foregoing and will take the
necessary steps to inform his or her agents and representatives of the
obligations undertaken in this Section 7(c), and (ii) notify Acquisition
immediately if any such inquiries or proposals are received by, any such
information is requested from, or any such negotiations or discussions are
sought to be initiated or continued with, him or her. Notwithstanding anything
to the contrary contained in Section 7, each Stockholder may take any action
permitted by the provisions of Section 6.1(d) of the Merger Agreement without
being in breach of this Section 7.
In addition, each Stockholder agrees to (i) deliver one or
more certificates evidencing all of such Stockholder's Option Shares (together
with any replacement certificates or certificates reflecting additional Shares
hereafter acquired by such Stockholder, but less such certificates, representing
in the aggregate not more than 18,000 Option Shares as of the date hereof, as
the Stockholders are not able to locate after diligent search thereof, the
"Share Certificates") to American Stock Transfer and Trust Company, transfer
agent for the Shares, for placement of an appropriate legend reflecting this
Agreement and (ii) keep the Share Certificates at all times prior to the
Expiration Date in the safekeeping of the Depositary of the Offer; provided that
the Depositary has delivered to the Stockholder an agreement in form acceptable
to the Stockholder and Acquisition to notify the Stockholder and Acquisition
five business days prior to the date such Share Certificates are to be removed
from Depositary's safekeeping.
SECTION 8. COVENANTS OF ACQUISITION. Acquisition covenants and agrees
for the benefit of the Stockholders that (a) immediately upon execution of this
Agreement, Acquisition shall enter into the Merger Agreement, and (b) until the
Merger Termination Date, it shall use all reasonable efforts to take, or cause
to be taken, all action, and do, or cause to be done, all things necessary or
advisable in order to consummate and make effective the transactions
contemplated by this Agreement and the Merger Agreement, consistent with the
terms and conditions of each such agreement; provided, however, that nothing in
this Section 8 or any other provision of this Agreement is intended, nor shall
it be construed, to limit or in any way restrict Acquisition's right or ability
to exercise any of its rights under the Merger Agreement.
SECTION 9. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS. Each
Stockholder represents and warrants to Acquisition that:
(a) the execution, delivery and performance by such
Stockholder of this Agreement will not conflict with, require a consent, waiver
or approval under, or result in a breach or default under, any of the terms of
any contract, commitment or other obligation (written or oral) to which such
Stockholder is bound;
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(b) such Stockholder has full right, power and authority to
enter into and execute this Agreement and to perform his obligations hereunder;
(c) this Agreement has been duly executed and delivered by
such Stockholder and constitutes a legal, valid and binding obligation of such
Stockholder enforceable against him in accordance with its terms;
(d) such Stockholder is the sole record and beneficial owner
of, and has the sole right to vote with respect to, the number of Shares set
forth opposite such Stockholder's name on Schedule A hereto, and such Shares
represent all Shares of or with respect to which such Stockholder is the sole
owner or has the right to vote at the date hereof;
(e) except for the Shares listed on Schedule A hereto, such
Stockholder does not have any right to acquire, nor is he or she the "beneficial
owner" (as such term is defined in Rule 13d-3 under the Securities Exchange Act
of 1934, as amended) of, any other shares of any class of capital stock of
Audits or any securities convertible into or exchangeable or exercisable for any
shares of any class of capital stock of Audits (other than shares subject to
options or other rights granted by Audits as set forth on Schedule B hereto);
(f) such Stockholder's Option Shares are duly authorized,
validly issued, fully paid and non-assessable, and such Stockholder owns its
Shares free and clear of all liens, claims, pledges, charges, proxies,
restrictions, encumbrances, proxies and voting agreements of any nature
whatsoever (each, an "Encumbrance") other than as provided by this Agreement,
and good and valid title to its Shares, free and clear of any Encumbrance, will
pass to Acquisition upon closing of the Offer or exercise of the Option granted
pursuant to Section 3 hereof; and
(g) The Board of Directors of Audits has approved the granting
of the Option to Acquisition.
The representations and warranties contained herein shall be made as of
the date hereof and as of the Closing.
SECTION 10. REPRESENTATIONS AND WARRANTIES OF ACQUISITION. Acquisition
represents and warrants to the Stockholders that:
(a) It has all requisite corporate power and authority to
enter into and perform all of its obligations under this Agreement;
(b) The execution, delivery and performance of this Agreement
by it and all transactions contemplated hereby have been duly authorized by all
necessary corporate action on its part, and this Agreement constitutes the
legal, valid and binding contract of Acquisition enforceable against it in
accordance with its terms; and
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(c) Acquisition will not acquire the Option Shares with a view
to the distribution thereof as that term is used in the Securities Act of 1933.
The representations and warranties contained herein shall be made as of
the date hereof and as of the Closing.
SECTION 11. ADJUSTMENTS; ADDITIONAL SHARES. In the event of any stock
dividend, stock split, merger (other than the Merger), recapitalization,
reclassification, combination, exchange of shares or the like of the capital
stock of Audits on, of or affecting the Option Shares, then the terms of this
Agreement shall apply to the shares of capital stock or other instruments or
documents that such Stockholder owns or has the right to vote, in respect of the
Option Shares of such Stockholder, immediately following the effectiveness of
the such event as though they were Option Shares hereunder.
SECTION 12. SPECIFIC PERFORMANCE. The parties hereto agree that the
Shares are unique and that money damages are an inadequate remedy for breach of
this Agreement because of the difficulty of ascertaining the amount of damage
that will be suffered by Acquisition in the event that this Agreement is
breached. Therefore, each of the Stockholders agrees that in addition to and not
in lieu of any other remedies available in Acquisition at law or in equity,
Acquisition may obtain specific performance of this Agreement.
SECTION 13. ASSIGNMENT. Acquisition's rights and obligations under this
Agreement may not be assigned without the consent of each affected Stockholder,
except that Acquisition may assign the same to any direct or indirect
wholly-owned subsidiary of United News & Media PLC upon delivery of written
notice of such assignment to such affected Stockholder(s). No such assignment
shall release Acquisition from its obligations under this Agreement.
SECTION 14. AMENDMENTS. No amendment or waiver of any provision of this
Agreement or consent to departure therefrom shall not be effective unless in
writing and signed by Acquisition and all affected Stockholders, in the case of
an amendment, or by the party which is the beneficiary of any such provision, in
the case of a waiver or a consent to depart therefrom.
SECTION 15. NOTICES. Any notices or other communications hereunder
shall be in writing and shall be deemed to have bee duly given (and shall be
deemed to have been duly received if so given) if personally delivered or sent
by telecopier or by registered or certified mail, postage paid, addressed to the
respective parties as follows:
If to Acquisition:
United Information Group Limited
Xxxxxxx Xxxxx
000 Xxxxxxxxxxx Xxxx
Xxxxxx XX0 0XX
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England
Attention: Mr. Xxx Xxxx
Telecopier No.: 011-44-171-579-4485
with a copy to:
United Information Group, Inc.
0 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Telecopier No.:000-000-0000
and a copy to:
Xxxxxx, Xxxxxxx & Xxxxxxx
0 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Telecopier No.: 000-000-0000
If to a Stockholder:
To the address listed on the signature page hereof
with a copy to:
Xxxxxx Xxxxxx Flattau & Klimpl, LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Fax: 000-000-0000
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
only be effective upon receipt.
SECTION 16. MISCELLANEOUS. All references herein to time shall mean New
York, New York time. All amounts payable hereunder are in United States Dollars.
SECTION 17. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal substantive laws of the State of New
York, without regard to the conflict of laws principles thereof.
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SECTION 18. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors,
personal representatives, executors, heirs and permitted assigns.
SECTION 19. HEADINGS. The Section headings herein are for convenience
of reference only and shall not affect the construction hereof.
SECTION 20. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same Agreement.
IN WITNESS WHEREOF, Acquisition and each of the Stockholders have duly
executed this Agreement as of the date and year first above written.
UNITED INFORMATION ACQUISITION CORP.
By: /s/ Xxxxxxx X. Block
---------------------------------
Name: Xxxxxxx X. Block
Title: President
/s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
Address: 0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
/s/ Xxxx Xxxxxxx
------------------------------------
Xxxx Xxxxxxx
Address: 0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxx 00000
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SCHEDULE A
STOCKHOLDER SHARES
NAME OF STOCKHOLDER NUMBER OF OPTION
SHARES
Xxxxxxx Xxxxx 4,860,905
Xxxx Xxxxxxx 1,528,713
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SCHEDULE B
SHARES SUBJECT TO OPTIONS OR OTHER RIGHTS
NAME OF STOCKHOLDER NUMBER OF SHARES
Xxxxxxx Xxxxx 50,000
Xxxx Xxxxxxx 20,000
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