Exhibit 10
AGREEMENT
DATED AS OF
AUGUST 31, 1998
BY AND AMONG
TMP WORLDWIDE INC.,
TASA HOLDING AG
AND THE
SHAREHOLDERS OF
TASA HOLDING AG NAMED HEREIN
TABLE OF CONTENTS
Page
ARTICLE I
PURCHASE AND SALE. . . . . . . . . . . . . 1
Section 1.01. Purchase and Sale. . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Release of Escrowed Shares . . . . . . . . . . . . . . . 2
Section 1.03. Closing. . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.04. Adjustments to the Stock Consideration . . . . . . . . . 3
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
TASA AND THE SHAREHOLDERS. . . . . . . . . . . 3
Section 2.01. Organization, Etc. . . . . . . . . . . . . . . . . . . . 3
Section 2.02. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.03. Capitalization . . . . . . . . . . . . . . . . . . . . . 4
Section 2.04. Authorization. . . . . . . . . . . . . . . . . . . . . . 5
Section 2.05. No Violation . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.06. Approvals. . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.07. Financial Statements and Other Information . . . . . . . 6
Section 2.08. Accounting Matters . . . . . . . . . . . . . . . . . . . 7
Section 2.09. No Undisclosed Liabilities . . . . . . . . . . . . . . . 8
Section 2.10. Corporate Action . . . . . . . . . . . . . . . . . . . . 8
Section 2.11. Events Subsequent to the Balance Sheet Date. . . . . . . 8
Section 2.12. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.13. Litigation . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.14. Compliance with Laws . . . . . . . . . . . . . . . . . . 12
Section 2.15. Title to Property. . . . . . . . . . . . . . . . . . . . 13
Section 2.16. Condition of Property and Related Matters. . . . . . . . 14
Section 2.17. Contracts. . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.18. Employee and Labor Matters and Plans . . . . . . . . . . 15
Section 2.19. Insurance Policies . . . . . . . . . . . . . . . . . . . 17
Section 2.20. Records. . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 2.21. Brokerage Fees . . . . . . . . . . . . . . . . . . . . . 18
Section 2.22. Customers. . . . . . . . . . . . . . . . . . . . . . . . 18
Section 2.23. Intellectual Properties. . . . . . . . . . . . . . . . . 18
Section 2.24. Licenses . . . . . . . . . . . . . . . . . . . . . . . . 19
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Section 2.25. No Illegal or Improper Transactions. . . . . . . . . . . 19
Section 2.26. Ownership of TMP Common Stock. . . . . . . . . . . . . . 19
Section 2.27. Restrictive Documents and Territorial Restrictions . . . 20
Section 2.28. Securities Act Matters . . . . . . . . . . . . . . . . . 20
Section 2.29. No Misleading Statements . . . . . . . . . . . . . . . . 22
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF TMP. . . . . . . . 22
Section 3.01. Organization, Etc. . . . . . . . . . . . . . . . . . . . 23
Section 3.02. Capitalization . . . . . . . . . . . . . . . . . . . . . 23
Section 3.03. Authorization. . . . . . . . . . . . . . . . . . . . . . 23
Section 3.04. No Violation . . . . . . . . . . . . . . . . . . . . . . 23
Section 3.05. Approvals. . . . . . . . . . . . . . . . . . . . . . . . 24
Section 3.06. SEC Filings. . . . . . . . . . . . . . . . . . . . . . . 24
Section 3.07. No Misleading Statements . . . . . . . . . . . . . . . . 24
Section 3.08. Sufficient Financial Resources . . . . . . . . . . . . . 25
ARTICLE IV
COVENANTS OF TASA
AND THE SHAREHOLDERS. . . . . . . . . . . . 25
Section 4.01. Conduct of TASA and the TASA Subsidiaries. . . . . . . . 25
Section 4.02. Access to Records. . . . . . . . . . . . . . . . . . . . 27
Section 4.03. No Other Bids. . . . . . . . . . . . . . . . . . . . . . 28
Section 4.04. Maintenance of Business. . . . . . . . . . . . . . . . . 28
Section 4.05. Compliance with Obligations. . . . . . . . . . . . . . . 28
Section 4.06. Pretax Operating Profit. . . . . . . . . . . . . . . . . 29
Section 4.07. Shareholders . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE V
COVENANTS OF TMP. . . . . . . . . . . . . 29
Section 5.01. Access to Records. . . . . . . . . . . . . . . . . . . . 29
Section 5.02. Treasury Shares. . . . . . . . . . . . . . . . . . . . . 29
Section 5.03. General Meeting of Shareholders of TASA. . . . . . . . . 30
ARTICLE VI
COVENANTS OF TASA, THE SHAREHOLDERS AND TMP . . . . . . 30
Section 6.01. Joint Transition Committee . . . . . . . . . . . . . . . 30
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Section 6.02. Advice of Changes. . . . . . . . . . . . . . . . . . . . 30
Section 6.03. Regulatory Approvals . . . . . . . . . . . . . . . . . . 31
Section 6.04. Actions Contrary to Stated Intent. . . . . . . . . . . . 31
Section 6.05. Certain Filings. . . . . . . . . . . . . . . . . . . . . 31
Section 6.06. Public Announcements . . . . . . . . . . . . . . . . . . 32
Section 6.07. Satisfaction of Conditions Precedent . . . . . . . . . . 32
Section 6.08. Confidentiality. . . . . . . . . . . . . . . . . . . . . 32
Section 6.09. Trading Prohibition. . . . . . . . . . . . . . . . . . . 32
Section 6.10 Registration of Stock Consideration. . . . . . . . . . . 33
Section 6.11. Extraordinary General Meeting of Shareholders. . . . . . 34
ARTICLE VII
CONDITIONS OF CLOSING. . . . . . . . . . . . 34
Section 7.01. Conditions to All Parties' Obligations. . . . . . . . . 34
Section 7.02. Conditions to the Obligations of TMP to Effect the
Acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(a) Accuracy of Representations and Warranties. . . . . . . . . . 35
(b) Covenants and Agreements. . . . . . . . . . . . . . . . . . . 35
(c) Consents. . . . . . . . . . . . . . . . . . . . . . . . . . . 35
(d) Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . 35
(e) Certificates of TASA. . . . . . . . . . . . . . . . . . . . . 35
(f) No Adverse Decision . . . . . . . . . . . . . . . . . . . . . 35
(g) Proceedings; Receipt of Documents . . . . . . . . . . . . . . 36
(h) Adverse Change. . . . . . . . . . . . . . . . . . . . . . . . 36
(i) Letters from Accountants. . . . . . . . . . . . . . . . . . . 36
(j) Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . 36
(k) Non-Compete/Non-Solicitation Agreements . . . . . . . . . . . 36
(l) Escrow Agreement. . . . . . . . . . . . . . . . . . . . . . . 36
Section 7.03. Conditions to the Obligations of TASA and the
Shareholders to Effect the Acquisition . . . . . . . . . . . . . . 37
(a) Accuracy of Representations and Warranties. . . . . . . . . . 37
(b) Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . 37
(c) Certificate of TMP. . . . . . . . . . . . . . . . . . . . . . 37
(d) Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . 37
(e) Adverse Change. . . . . . . . . . . . . . . . . . . . . . . . 37
(f) Non-Compete/Non-Solicitation Agreements . . . . . . . . . . . 37
(g) Escrow Agreement. . . . . . . . . . . . . . . . . . . . . . . 37
(h) Reorganization Representations. . . . . . . . . . . . . . . . 38
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ARTICLE VIII
TERMINATION, AMENDMENTS AND WAIVERS . . . . . . . . 38
Section 8.01. Termination. . . . . . . . . . . . . . . . . . . . . . . 38
Section 8.02. Effect of Termination. . . . . . . . . . . . . . . . . . 39
Section 8.03. Amendment. . . . . . . . . . . . . . . . . . . . . . . . 39
Section 8.04. Waiver . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE IX
INDEMNIFICATION . . . . . . . . . . . . . 39
Section 9.01. Indemnification by the Shareholders. . . . . . . . . . . 39
Section 9.02. Indemnification by TMP . . . . . . . . . . . . . . . . . 40
Section 9.03. Brokerage Fees . . . . . . . . . . . . . . . . . . . . . 40
Section 9.04. Limitations. . . . . . . . . . . . . . . . . . . . . . . 41
Section 9.05 Notice and Defense of Claims . . . . . . . . . . . . . . 41
Section 9.06. Non-Exclusive Remedy . . . . . . . . . . . . . . . . . . 42
Section 9.07. Survival of Representations and Warranties . . . . . . . 42
Section 9.08 Reimbursement. . . . . . . . . . . . . . . . . . . . . . 42
Section 9.09. Offset . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 9.10. Arbitration. . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE X
DEFINITIONS . . . . . . . . . . . . . . 43
ARTICLE XI
GENERAL PROVISIONS . . . . . . . . . . . . 49
Section 11.01. Taking of Necessary Action; Specific Performance . . . . 49
Section 11.02. Effect of Due Diligence. . . . . . . . . . . . . . . . . 49
Section 11.03. Expenses . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 11.04. Successors and Assigns . . . . . . . . . . . . . . . . . 49
Section 11.05. Entire Agreement . . . . . . . . . . . . . . . . . . . . 49
Section 11.06. Notices. . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 11.07. Applicable Law. . . . . . . . . . . . . . . . . . . . . 50
Section 11.08. Counterparts . . . . . . . . . . . . . . . . . . . . . . 50
Section 11.09. Headings . . . . . . . . . . . . . . . . . . . . . . . . 50
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AGREEMENT
AGREEMENT, dated as of August 31, 1998 (this "AGREEMENT"), by and among TMP
Worldwide Inc., a Delaware corporation ("TMP"), TASA HOLDING AG, a Swiss
corporation ("TASA"), and the shareholders of TASA set forth on Schedule A
attached hereto (the "SHAREHOLDERS"). Capitalized terms used in this Agreement
are defined in Article X.
R E C I T A L S:
A. The respective Boards of Directors of TMP and TASA and the
respective individual Shareholders have each determined to engage in the
transactions contemplated hereby, pursuant to which TMP will purchase from the
Shareholders set forth on Exhibit A hereto, all of the outstanding capital stock
of TASA, in consideration for the issuance to the Shareholders of an aggregate
of 1,703,894 unregistered shares of Common Stock, par value $.001 per share, of
TMP ("TMP COMMON STOCK"), subject to the terms and conditions set forth herein
(the "ACQUISITION").
B. The Boards of Directors of TMP and TASA and the Shareholders have
each approved the Acquisition.
NOW, THEREFORE, in consideration of the premises, the representations,
warranties and agreements herein contained and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
subject to the conditions set forth herein, TMP and TASA and the Shareholders
hereby agree as follows:
ARTICLE I
PURCHASE AND SALE
SECTION 1.01. PURCHASE AND SALE. At the Closing and subject to and upon
the terms and conditions of this Agreement, the Shareholders shall sell,
transfer and deliver to TMP, and TMP shall purchase and acquire from the
Shareholders set forth on Exhibit A hereto, all of their respective right, title
and
interest in and to all of the outstanding shares of capital stock of TASA, free
and clear of all Liens (other than restrictions imposed by United States, state
and foreign securities laws), all in consideration for the sale, transfer and
delivery by TMP to the Shareholders of 1,703,894 unregistered shares of TMP
Common Stock (the "Stock Consideration"), 1,668,179 of such shares (the "Closing
Shares") to be issued at Closing (as defined herein) and the remaining 35,715
shares (the "Escrowed Shares") to be held in an escrow account until the Escrow
Release Date (as defined herein). In the event that at any time Xxxxxx X.
XxXxxxxx, his immediate family and/or his or their respective beneficiaries
cease to own at least 30% in the aggregate of the combined voting power of TMP's
outstanding capital stock, voting as a single class, prior to the Escrow Release
Date, the Escrowed Shares shall immediately become released from escrow.
SECTION 1.02. RELEASE OF ESCROWED SHARES. The Escrowed Shares shall be
held pursuant to an Escrow Agreement between TMP, Xxxxxx, Xxxxxx, Herlands,
Randolph, Xxxxxxxxx & Cox LLP, and the Shareholders, substantially in the form
of Exhibit 1.02 hereto (the "Escrow Agreement"). The Escrowed Shares shall be
released to the Shareholders in accordance with the terms of the Escrow
Agreement at such time as the obligations of TASA and the Shareholders pursuant
to Article IX shall terminate (the "Escrow Release Date").
SECTION 1.03. CLOSING.
(a) Subject to the provisions of Article VII hereof, the closing (the
"CLOSING") of the Acquisition shall take place at 10:00 a.m., New York time, at
the offices of Fulbright & Xxxxxxxx L.L.P., 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, no later than the second Business Day after satisfaction of the latest to
occur of the conditions set forth in Article VII hereof (other than the delivery
of the officers' certificates and opinions referred to therein and other than
any conditions which are waived in accordance with said Article) or such other
time, place or date as TMP and TASA may mutually agree. Failure to consummate
the transactions provided for in this Agreement on the date and time selected
pursuant to this Section 1.03(a) shall not, except as permitted by Article VIII
hereof, result in the termination of this Agreement and shall not relieve any
party to this Agreement of any obligation hereunder.
(b) At the Closing, each Shareholder shall deliver to TMP a certificate in
the form of Exhibit 1.03(b) hereto, evidencing the assignment and transfer to
TMP of the shares of TASA held by each such Shareholder.
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(c) At the Closing, TMP shall deliver to the Shareholders the Closing
Shares and to the escrow agent, the Escrowed Shares. The proportion of the
Closing Shares to be allocated to each Shareholder at the Closing and the
proportion of the Escrowed Shares to be allocated to each Shareholder on the
Escrow Release Date is set forth on Schedule A hereto. The certificates
representing the Closing Shares will be delivered to each Shareholder at its
address set forth in Section 11.06 or to such other address as the Shareholder
shall advise TMP in writing. TMP Holdings shall not be required to issue
fractional shares of TMP Common Stock, but cash shall be paid in lieu thereof on
the basis of the ratio that the applicable fraction bears to $28.00.
SECTION 1.04. ADJUSTMENTS TO THE STOCK CONSIDERATION.
Notwithstanding anything to the contrary contained herein, as soon as
practicable and in any event no later than five days prior to the Closing, TASA
shall deliver to TMP an unaudited balance sheet for TASA as of July 31, 1998
(the "CLOSING BALANCE SHEET"). The Closing Balance Sheet shall be prepared on
the same basis as the TASA Balance Sheet, and include all normal and recurring
adjustments necessary for a fair presentation of the information set forth
therein. The value of the Stock Consideration shall be adjusted downward, on a
dollar for dollar basis, if the shareholders' equity, as shown on the Closing
Balance Sheet, is less than the shareholders' equity as shown on the TASA
Balance Sheet.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
TASA AND THE SHAREHOLDERS
Except as set forth (by reference to the applicable Section of this
Agreement) in the disclosure schedule previously delivered to TMP (the "TASA
DISCLOSURE SCHEDULE"), TASA and each Shareholder, jointly and severally, hereby
represent and warrant to TMP as follows:
SECTION 2.01. ORGANIZATION, ETC. TASA is a corporation duly organized,
validly existing and in good standing under the laws of Switzerland and has full
corporate power and authority to conduct its business as it is now being
conducted and to own, operate or lease the properties and assets it currently
owns, operates or holds under lease. TASA is duly qualified or licensed to do
business and is in good standing as a foreign corporation in each jurisdiction
where the character of its business or the nature of its properties makes such
qualification or licensing
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necessary, except where the failure to so qualify or be licensed would not have
a Material Adverse Effect, all of which jurisdictions are set forth on the TASA
Disclosure Schedule. TASA has heretofore delivered to TMP true and correct
copies of its Memorandum and Articles of Association (or analogous
organizational documents) as in effect on the date hereof. TASA has all
requisite corporate power and authority to enter into this Agreement and each of
the other agreements contemplated hereby, to carry out its obligations under
this Agreement and each of the other agreements contemplated hereby and to
consummate the transactions contemplated hereby and thereby.
SECTION 2.02. SUBSIDIARIES. The TASA Disclosure Schedule contains a list
of all TASA Subsidiaries and indicates for each TASA Subsidiary: (a) the
percentage and type of equity securities of or other interest in the TASA
Subsidiary owned or controlled by TASA; (b) the identity of any other beneficial
or record owner of any such TASA Subsidiary and the percentage and type of such
ownership; (c) the jurisdiction of incorporation or organization; (d) each
jurisdiction in which it is qualified or licensed to conduct its business; and
(e) in the case of any joint venture, the identity of each other joint venture
partner. TASA is the direct or indirect owner, beneficially and of record, of
all such equity securities or other interests listed as being owned by it, free
and clear of all Liens. The TASA Subsidiaries constitute all of the
Subsidiaries of TASA. All the outstanding shares of stock of each such TASA
Subsidiary have been duly authorized and validly issued and are fully paid and
non-assessable. Except as set forth in the Tasa Disclosure Schedule, there are
no options, warrants, calls, rights, commitments, preemptive rights or
agreements of any character to which any such TASA Subsidiary, any of the
Shareholders or TASA is a party or by which any such party is bound obligating
it to issue, deliver or sell, or cause to be issued, delivered or sold,
contingently or otherwise, additional equity or other ownership interests of
such TASA Subsidiary or any securities or obligations convertible into or
exchangeable for such interests, or to grant, extend or enter into any such
option, warrant, call, right, commitment, preemptive right or agreement. Each
TASA Subsidiary that is a corporation is duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation and has all
requisite corporate power and authority to own, lease and operate its properties
and to conduct its business as it is now being conducted. Each TASA Subsidiary
that is not a corporation is duly organized under the laws of the jurisdiction
of its organization and has all requisite power and authority to own, lease and
operate its properties and to conduct its business as it is now being conducted.
A true and correct copy of the Memorandum and Articles of Association (or
analogous organizational documents) of each Significant TASA Subsidiary as in
effect on the date hereof have been provided to TMP. Each of the TASA
Subsidiaries is duly qualified or licensed to conduct its business and is in
good standing in each jurisdiction where
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the character of its business or the nature of its properties makes such
qualification or licensing necessary, except where the failure to so qualify or
be licensed would not have a Material Adverse Effect. The TASA Disclosure
Schedule contains a list of all Subsidiaries (other than the TASA Subsidiaries),
partnerships, joint ventures and other entities in which TASA has, directly or
indirectly, any legal or beneficial interest, specifying in detail the amount
and nature of such interest.
SECTION 2.03. CAPITALIZATION. The issued and outstanding capital stock of
TASA is as set forth on the TASA Disclosure Schedule. All of the issued and
outstanding shares of TASA are owned, of record and beneficially, by the
Shareholders as set forth in the TASA Disclosure Schedule. No Person other than
the Shareholders is or will be entitled to receive any payment with respect to
the capital stock of TASA. Except as set forth on the TASA Disclosure Schedule,
there are no shares of common stock of TASA held as treasury shares. The
designations, powers, preferences, rights, qualifications, limitations and
restrictions in respect of each class and series of authorized capital stock of
TASA are as set forth in TASA's Memorandum of Association (or analogous
organizational documents), and all such designations, powers, preferences,
rights, qualifications, limitations and restrictions are valid, binding and
enforceable and in accordance with all applicable laws. All outstanding shares
of capital stock of TASA, all of which are uncertificated, have been duly
authorized and validly issued and are fully paid and non-assessable. All of the
outstanding securities of TASA were issued in compliance with all applicable
securities laws. None of the outstanding securities has been issued in
violation of any pre-emptive rights, rights of first refusal or similar rights.
There are no outstanding options, warrants, convertible securities, calls,
rights, commitments, preemptive rights or agreements or instruments or
understandings of any character to which TASA is a party or by which TASA or any
of the Shareholders is bound, obligating any of them to issue, deliver or sell,
or cause to be issued, delivered or sold, contingently or otherwise, additional
shares of TASA's capital stock or any securities or obligations convertible into
or exchangeable for such shares or to grant, extend or enter into any such
option, warrant, convertible security, call, right, commitment, preemptive right
or agreement. There are no outstanding obligations, contingent or other, of
TASA to purchase, redeem or otherwise acquire any shares of its capital stock.
There are no voting trust agreements or other contracts, agreements,
arrangements, commitments, plans or understandings restricting or otherwise
relating to voting, dividend or other rights with respect to any of TASA's
capital stock. There are no outstanding options, warrants, convertible
securities, calls, rights, commitments, preemptive rights or agreements or
instruments or understandings of any character to which TASA is a party or by
which TASA is bound, obligating TASA to issue, deliver or sell, or cause to be
issued, delivered or sold, contingently or otherwise, any shares of the TASA
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Subsidiaries' Common Stock owned by it or any securities or obligations
convertible into or exchangeable for such shares or to grant, extend or enter
into any such option, warrant, convertible security, call, right, commitment,
preemptive right or agreement. The Shareholders have, and upon transfer of the
shares of Common Stock of TASA at the Closing, TMP will have, good and
marketable title to all of the issued and outstanding shares of the Common Stock
of TASA except as set forth in the TASA Disclosure Schedule, free and clear of
any Liens (other than restrictions imposed by United States, state and foreign
securities laws).
SECTION 2.04. AUTHORIZATION. The execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby and the
performance by TASA of its obligations hereunder have been duly authorized by
all necessary corporate action on the part of TASA. This Agreement has been
duly executed and delivered by TASA and each of the Shareholders and constitutes
the legal, valid and binding obligation of each of them enforceable against each
of them in accordance with its terms. TASA and each TASA Subsidiary are in
compliance with all applicable laws, rules or regulations relating to or
affecting the operation, conduct or ownership of their respective property or
business, other than violations that individually or in the aggregate would not,
and insofar as may reasonably be foreseen in the future will not, have a
Material Adverse Effect.
SECTION 2.05. NO VIOLATION. The execution and delivery of this Agreement
by TASA and each of the Shareholders do not, and the consummation by each of
them of the transactions contemplated hereby, and compliance with the terms
hereof will not, (a) conflict with, or result in any violation of or default or
loss of any benefit under, any provision of TASA's Memorandum and Articles of
Association (or analogous organizational documents); (b) conflict with, or
result in any violation of or default or loss of any benefit under, any permit,
concession, grant, franchise, law, rule or regulation, or any judgment, decree
or order of any court or other governmental agency or instrumentality to which
TASA or any TASA Subsidiary or any of the Shareholders is a party or to which
any of their respective property is subject; (c) conflict with, or result in a
breach or violation of or default or loss of any benefit under, or accelerate
the performance required by, the terms of any agreement, contract, indenture or
other instrument to which TASA or any TASA Subsidiary is a party or to which any
of their respective property is subject, or constitute a default or loss of any
right thereunder or an event which, with the lapse of time or notice or both,
might result in a default or loss of any right thereunder or the creation of any
lien, charge or encumbrance upon any of the assets or properties of TASA or any
TASA Subsidiary, or give rise to a right of termination under any TASA Contract;
or (d) result in any suspension, revocation, impairment, forfeiture or
nonrenewal of any TASA License.
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SECTION 2.06. APPROVALS. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by each of TASA and the
Shareholders will not require the consent, approval, order or authorization of
any Governmental Entity or Regulatory Authority or any other Person under any
statute, law, rule, regulation, permit, license, agreement, indenture or other
instrument to which TASA, the TASA Subsidiaries or any of the Shareholders is a
party or to which any of their properties are subject, and no declaration,
filing or registration with any Governmental Entity or Regulatory Authority is
required or advisable in connection with the execution and delivery of this
Agreement, the consummation of the transactions contemplated hereby, or the
performance by each of them of its respective obligations hereunder, other than
the approval of the Board of Managers of the TASA Partnership and the Board of
Directors of TASA, each with regard to the transfer of the shares of TASA Common
Stock to TMP.
SECTION 2.07. FINANCIAL STATEMENTS AND OTHER INFORMATION.
(a) TASA has delivered to TMP (i) true, correct and complete copies of
TASA's audited consolidated balance sheets as of December 31, 1997, 1996 and
1995, and the related statements of operations (together with the auditors'
reports thereon) for the years ended December 31, 1997, 1996 and 1995, together
with notes to such financial statements (the "AUDITED FINANCIAL STATEMENTS") and
(ii) true, correct and complete copies of TASA's unaudited combined and
combining balance sheets as at June 30, 1998, and the related statements of
operations for the six months ended June 30, 1998 and 1997 (the "INTERIM
FINANCIAL STATEMENTS"). The Audited Financial Statements and Interim Financial
Statements are herein collectively referred to as the "FINANCIAL STATEMENTS".
(b) The Financial Statements are true, correct and complete in all
material respects, are in accordance with the books and records of TASA and have
been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods covered thereby, and the balance
sheets included therein present fairly as of their respective dates the
financial condition of TASA (subject, in the case of Interim Financial
Statements, to non-material year-end adjustments that may be required upon
audit, which adjustments will not have a Material Adverse Effect on such
financial statements). All material liabilities and obligations, whether
absolute, accrued, contingent or otherwise, whether direct or indirect, and
whether due or to become due, which existed at the date of such Financial
Statements have been disclosed in the balance sheets included in the Financial
Statements or in notes to the Financial Statements to the extent such
liabilities were required, under generally accepted accounting principles, to be
so disclosed. The statements of operations,
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accumulated deficit and cash flows included in the Financial Statements present
fairly the results of operations, accumulated deficit and cash flows of TASA for
the periods indicated (subject, in the case of Interim Financial Statements, to
year-end adjustments that may be required upon audit, which adjustments will not
have a Material Adverse Effect on such financial statements), and the notes
included in the Financial Statements present fairly the information purported to
be shown thereby. The statements of operations included in the consolidated
Financial Statements of TASA do not contain any material items of special or
non-recurring income or other income not earned in the ordinary course of
business except as expressly specified therein. All amounts billed to customers
and clients of the TASA Subsidiaries reflected in the consolidated Financial
Statements are for executive search services and collateral activities relating
thereto and not for any other business.
(c) Since the Balance Sheet Date there has been (i) no Material Adverse
Change in the assets or liabilities, or in the business or condition, financial
or otherwise, or in the results of operations or, to the best knowledge of TASA
and each of the Shareholders, prospects, of TASA or the TASA Subsidiaries,
whether as a result of any legislative or regulatory change, revocation of any
license or right to do business, fire, explosion, accident, casualty, labor
trouble, flood, drought, riot, storm, condemnation or act of God or otherwise,
(ii) no adverse change in the assets or liabilities or in the business or
condition, financial or otherwise, of any of them except in the ordinary course
of business; and, to the best knowledge of TASA and the Shareholders, no fact or
condition exists or is contemplated or threatened which could reasonably be
anticipated to cause such a change in the future and (iii) no decreases in
revenue or operating income. There has been no Material Adverse Change since
the Balance Sheet Date in the amount of accounts receivable (or the allowance
with respect thereto) or accounts payable of TASA from that reflected in the
June 30, 1998 balance sheet.
SECTION 2.08. ACCOUNTING MATTERS. Neither TASA nor any TASA Subsidiary
nor, to the best knowledge of TASA, any of TASA's directors or officers, has
taken any action or is aware of any facts or circumstances in respect of TASA,
any TASA Subsidiary or their respective accounting procedures which would have
the effect of precluding accounting for the transactions contemplated by this
Agreement as a "pooling of interests" in accordance with Accounting Principles
Board Opinion No. 16, the interpretive releases thereto and the relevant
pronouncements of the United States Securities and Exchange Commission. No
Shareholder has in any way reduced their respective risk or committed to reduce
their respective risk with respect to either the shares of TASA Common Stock
held by such Shareholder or the
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TMP Common Stock to be acquired by such Shareholder hereunder, whether by
entering into a put, collar, option or other arrangement.
SECTION 2.09. NO UNDISCLOSED LIABILITIES. Except as set forth in the
notes to the Financial Statements or on the TASA Disclosure Schedule, the
liabilities on the latest balance sheet included in the Financial Statements
consist solely of accrued obligations and liabilities incurred by TASA in the
ordinary course of its business to Persons which are not Affiliates of TASA or
any of the Shareholders. There are no liabilities of TASA or the TASA
Subsidiaries of any kind whatsoever, whether or not accrued and whether or not
contingent or absolute, determined or determinable or otherwise, including
without limitation documentary or standby letters of credit, bid or performance
bonds, or customer or third party guarantees, and no existing condition,
situation or set of circumstances that could reasonably result in such a
liability, other than (i) liabilities disclosed in the Financial Statements, and
(ii) liabilities which have arisen after the Balance Sheet Date in the ordinary
course of business and consistent with past practice (none of which is a
liability for breach of contract, breach of warranty (other than chargebacks
incurred in the ordinary course of business and consistent with past practice),
tort, infringement claim or lawsuit) which, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. There are
no asserted claims for indemnification by any Person against TASA or any TASA
Subsidiary under any law or agreement or pursuant to the Memorandum and Articles
of Association (or analogous organizational documents) of TASA or any TASA
Subsidiary and TASA is not aware of any facts or circumstances that might
reasonably give rise to the assertion of such a claim against TASA or any TASA
Subsidiary.
SECTION 2.10. CORPORATE ACTION. All corporate action of the Board of
Directors of TASA and of the Shareholders taken on or prior to the date hereof
has been duly authorized, adopted or ratified in accordance with applicable law
and TASA's or such TASA Subsidiary's Memorandum and Articles of Association (or
analogous organizational documents) and has been duly recorded in its respective
corporate (or equivalent) minute books (which have been made available for
inspection by TMP).
SECTION 2.11. EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE. Since the
Balance Sheet Date, neither TASA nor any TASA Subsidiary has (a) issued any
stock, bond or other corporate security (including without limitation securities
convertible into or rights to acquire capital stock of any of them), (b)
borrowed any amount or incurred or become subject to any liability (absolute,
accrued or contingent), except current liabilities incurred, liabilities under
contracts entered into, borrowings under the banking facilities disclosed on the
TASA Disclosure Schedule and liabilities
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in respect of letters of credit issued under such banking facilities, all of
which were in the ordinary course of business, (c) discharged or satisfied any
lien or encumbrance or incurred or paid any obligation or liability (absolute,
accrued or contingent) other than current liabilities shown on the most recent
balance sheet included in the Financial Statements and current liabilities
incurred since the Balance Sheet Date in the ordinary course of business, (d)
except as disclosed in the TASA Disclosure Schedule, declared or made any
payment or distribution to shareholders or purchased or redeemed any shares of
its capital stock or other securities, (e) mortgaged, pledged or subjected to
lien any of its assets, tangible or intangible, other than liens of current real
property taxes not yet due and payable, (f) sold, assigned or transferred any of
its tangible assets except in the ordinary course of business, or canceled any
debt or claim, (g) sold, assigned, transferred or granted any license with
respect to any patent, trademark, trade name, service xxxx, copyright, trade
secret or other intangible asset, (h) suffered any loss of property in excess of
$25,000 in the aggregate or waived any right of substantial value whether or not
in the ordinary course of business, (i) suffered any adverse change in its
relations with, or any loss or threatened loss of, any of its suppliers, or its
customers disclosed pursuant to Section 2.22, (j)(i) granted any severance or
termination pay to any of its directors, officers or employees, (ii) entered
into any employment, deferred compensation or other similar agreement (or any
amendment to any such existing agreement) or arrangement with any of its
directors, officers or employees, (iii) increased any benefits payable under any
existing severance or termination pay policies or employment agreements, or
(iv) increased the compensation, bonus or other benefits payable to any of its
directors or officers or, other than in the ordinary course of business and
consistent with past practice, employees, (k) made any material change in the
manner of its business or operations, (l) made any material change in any method
of accounting or accounting practice, except for any such change required by
reason of a concurrent change in generally accepted accounting principles or
disclosed in the Financial Statements, (m) entered into any transaction except
in the ordinary course of business or as otherwise contemplated hereby or (n)
entered into any commitment (contingent or otherwise) to do any of the
foregoing.
SECTION 2.12. TAXES. Except as set forth on Schedule 2.12 of the TASA
Disclosure Schedule:
(a) All Tax Returns required to be filed by or on behalf of TASA or any
TASA Subsidiary have been properly prepared and duly and timely filed with the
appropriate taxing authorities in all jurisdictions in which such Tax Returns
are required to be filed (after giving effect to any valid extensions of time in
which to
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make such filings), and all such Tax Returns were true, complete and correct in
all material respects.
(b) All Taxes payable by or on behalf of TASA and the TASA Subsidiaries or
in respect of their respective income, assets or operations (including interest
and penalties) have been fully and timely paid, and adequate reserves or
accruals for Taxes have been provided in the Closing Balance Sheet with respect
to any period for which Tax Returns have not yet been filed or for which Taxes
are not yet due and owing.
(c) Neither TASA nor any of the TASA Subsidiaries has executed or filed
with the IRS or any other taxing authority any agreement, waiver or other
document or arrangement extending or having the effect of extending the period
for assessment or collection of Taxes (including, but not limited to, any
applicable statute of limitation), and no power of attorney with respect to any
Tax matter is currently in force.
(d) TASA and the TASA Subsidiaries have complied in all material respects
with all applicable laws, rules and regulations relating to the payment and
withholding of Taxes and has duly and timely withheld from employee salaries,
wages and other compensation and has paid over to the appropriate taxing
authorities all amounts required to be so withheld and paid over for all periods
under all applicable laws.
(e) TMP has received complete copies of (A) all U.S. federal and foreign
income or franchise Tax Returns of TASA and the TASA Subsidiaries relating to
the taxable periods since December 31, 1995 and (B) any audit report issued
within the last three years relating to Taxes due from or with respect to TASA,
the TASA Subsidiaries, their respective income, assets or operations. All
income and franchise Tax Returns filed by or on behalf of TASA and the TASA
Subsidiaries for the taxable years ended on the respective dates set forth on
the TASA Disclosure Schedule have been examined by the relevant taxing authority
or the statute of limitations with respect to such Tax Returns has expired.
(f) The TASA Disclosure Schedule lists all material types of Taxes paid
and material types of Tax Returns filed by or on behalf of TASA and the TASA
Subsidiaries and indicates those Taxes with respect to which TASA or any TASA
Subsidiary is or has been a member of an Affiliated Group for any Tax purpose.
Except as set forth on the TASA Disclosure Schedule, no claim has been made by a
taxing authority in a jurisdiction where TASA or any TASA Subsidiary does not
file Tax Returns such that it is or may be subject to taxation by that
jurisdiction.
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(g) All deficiencies asserted or assessments made as a result of any
examinations by the IRS or any other taxing authority of the Tax Returns of or
covering or including TASA and/or the TASA Subsidiaries have been fully paid,
and there are no other audits or investigations by any taxing authority or
proceedings in progress, nor have the Shareholders, TASA or any TASA Subsidiary
received any notice from any taxing authority that it intends to conduct such an
audit or investigation. No issue has been raised by a U.S. federal, state,
local or foreign taxing authority in any current or prior examination which, by
application of the same or similar principles, could reasonably be expected to
result in a proposed deficiency for any subsequent taxable period. The results
of any settlement and the necessary adjustments resulting therefrom are properly
reflected in the Closing Balance Sheet.
(h) Neither TASA, any TASA Subsidiary nor any other Person (including any
of the Shareholders) on behalf of TASA has (A) filed a consent pursuant to
Section 341(f) of the Code or agreed to have Section 341(f)(2) of the Code apply
to any disposition of a subsection (f) asset (as such term is defined in Section
341(f)(4) of the Code) owned by TASA or TASA Subsidiary, (B) agreed to or is
required to make any adjustments pursuant to Section 481(a) of the Code or any
similar provision of state, local or foreign law by reason of a change in
accounting method initiated by TASA or any TASA Subsidiary or has any knowledge
that the IRS has proposed any such adjustment or change in accounting method, or
has any application pending with any taxing authority requesting permission for
any changes in accounting methods that relate to the business or operations of
TASA or any TASA Subsidiary, or has otherwise taken any action that would have
the effect of deferring any liability for Taxes from any taxable period ending
on or before the Closing to any taxable period ending thereafter, (C) executed
or entered into closing agreement pursuant to Section 7121 of the Code or any
predecessor provision thereof or any similar provision of state, local or
foreign law with respect to TASA or any TASA Subsidiary, or (D) requested any
extension of time within which to file any Tax Return, which Tax Return has
since not been filed.
(i) No property owned by TASA or any TASA Subsidiary is (i) property
required to be treated as being owned by another Person pursuant to the
provisions of Section 168(f)(8) of the Internal Revenue Code of 1954, as amended
and in effect immediately prior to the enactment of the Tax Reform Act of 1986,
(ii) constitutes "tax-exempt use property" within the meaning of Section
168(h)(1) of the Code or (iii) is "tax-exempt bond financed property" within the
meaning of Section 168(g) of the Code.
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(j) Neither TASA nor any TASA Subsidiary is a party to any tax sharing or
similar agreement or arrangement (whether or not written) pursuant to which it
will have any obligation to make any payments after the Closing.
(k) There is no contract, agreement, plan or arrangement covering any
person that, individually or collectively, could give rise to the payment of any
amount that would not be deductible by TMP or any of its Affiliates by reason of
Section 280G of the Code, or would constitute compensation in excess of the
limitation set forth in Section 162(m) of the Code.
(l) TASA and each TASA Subsidiary has substantial authority for the
treatment of or has disclosed (in accordance with Section 6662(d)(2)(B)(ii) of
the Code) on its federal income Tax Returns all positions taken therein that
could give rise to a substantial understatement of federal income tax within the
meaning of Section 6662(d) of the Code.
(m) Neither TASA nor any TASA Subsidiary is subject to any private letter
ruling of the IRS or comparable rulings of other taxing authorities.
(n) There are no liens as a result of any unpaid Taxes upon any of the
assets of TASA or any TASA Subsidiary.
(o) All material Tax elections of TASA and the TASA Subsidiaries are
clearly set forth in the Tax Returns described in Section 2.12(e)(A). Neither
TASA nor any TASA Subsidiary have elections in effect for U.S. federal income
tax purposes under Sections 108, 168, 338, 441, 463, 472, 1017, 1033 or 4977 of
the Code.
(p) Other than the Affiliated Group of which TASA is the parent and each
of TASA and the TASA Subsidiaries are currently members, neither TASA nor any
TASA Subsidiary has ever been a member of any Affiliated Group of corporations
for any Tax purposes. Neither TASA nor TASA owns any interest in any entity
that is treated as a partnership for U.S. federal income tax purposes or would
be treated as a pass-through or transparent entity for any tax purpose.
(q) Neither TASA nor any Tasa Subsidiary is a United States Real Property
Holding Corporation ("USRPHC") within the meaning of Section 897 of the Code and
neither was a USRPHC on any "determination date" (as defined in Section
1.897-2(c) of the Treasury regulations under the Code) that occurred in the five
year period preceding the Closing.
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(r) Neither TASA nor any TASA Subsidiary has any application pending with
any taxing authority requesting permission for any changes in accounting
methods.
(s) Neither TASA nor any TASA Subsidiary has filed an election pursuant to
Revenue Procedure 95-11, 1995-1 C.B. 505 or under Treasury regulation Section
1.1502-75(c) or any similar provision of foreign, national, international, state
or local law.
SECTION 2.13. LITIGATION. Except as disclosed in the TASA Disclosure
Schedule, there is no action, suit, investigation, arbitration or proceeding
pending or, to the best knowledge of TASA and the Shareholders, threatened
against or affecting TASA and the TASA Subsidiaries or any of their respective
properties or rights (including without limitation no charge of patent and/or
trademark infringement), by or before any Governmental Entity, or any basis in
fact therefor known to TASA and the Shareholders, against or involving TASA and
the TASA Subsidiaries or any of their respective officers, directors or
employees (in their capacity as such), assets, business or products, whether at
law or in equity. With respect to each litigation or claim described in the
TASA Disclosure Schedule, copies of all pleadings, filings, correspondence with
opposing parties and their counsel, opinions of counsel, results of studies,
judgments, orders, attachments, impositions of or recordings of Liens and other
documents have been furnished to TMP. Neither TASA nor any TASA Subsidiary nor
any Shareholder has received any written opinion or memorandum of legal advice
from legal counsel to the effect that any of them is exposed to any liability
for a potential litigation or claim which may have a Material Adverse Effect.
Except as disclosed in the TASA Disclosure Schedule, TASA is not engaged in any
legal action to recover monies due it or for damages sustained by it.
SECTION 2.14. COMPLIANCE WITH LAWS. The business of TASA and the TASA
Subsidiaries has not been conducted in violation of any law or any ordinance or
regulation of any Governmental Entity, except for violations that individually
or in the aggregate would not and, insofar as may reasonably be foreseen, in the
future will not, have a Material Adverse Effect. No investigation or review by
any Governmental Entity (including without limitation any audit or similar
review by any foreign, state or local taxing authority) with respect to TASA and
the TASA Subsidiaries is pending or, to TASA's and the Shareholders' best
knowledge, threatened, nor has any Governmental Entity indicated in writing to
TASA or the TASA Subsidiaries an intention to conduct the same. TASA nor, to
the best of its knowledge, any director, officer, consultant or employee of TASA
and the TASA Subsidiaries (in their capacity as such), is in default with
respect to any order, writ, injunction or decree known to or served upon TASA or
any of the TASA Subsidiaries
-14-
of any Governmental Entity or Regulatory Authority, which default would have a
Material Adverse Effect. There is no existing law, rule, regulation or order,
whether Federal, state, local or foreign, which would prohibit or materially
restrict TASA or any of the TASA Subsidiaries from, or otherwise materially
adversely affecting them in, conducting their business in any jurisdiction in
which they now conduct business or in which they currently propose to conduct
business. TASA and the TASA Subsidiaries are in compliance with all applicable
Environmental Laws.
SECTION 2.15. TITLE TO PROPERTY.
(a) TASA and the TASA Subsidiaries do not own any real property. The TASA
Disclosure Schedule identifies all of the rights and interests in leasehold
estates owned by TASA and the TASA Subsidiaries as of the date hereof, and the
nature and amount of its respective interest therein. TASA and the TASA
Subsidiaries have valid, subsisting and enforceable leases to all leasehold
estates identified and reflected in the TASA Disclosure Schedule (with such
exceptions as are, individually or in the aggregate, not material and do not,
individually or in the aggregate, materially interfere with the use made and
proposed to be made of such properties) and either good and marketable title or
rights as lessee to all personalty of any kind or nature owned or used by TASA
and the TASA Subsidiaries in their respective business, in each case free and
clear of all Liens, encumbrances or claims whatsoever, except for (i) Liens,
encumbrances, defects or irregularities of title identified on the TASA
Disclosure Schedule which, individually or in the aggregate, do not detract from
or materially interfere with the present or reasonably foreseeable use or value
of the properties subject thereto, and (ii) Liens for non-delinquent ad valorem
taxes and non-delinquent statutory liens arising other than by reason of default
by TASA or any of the TASA Subsidiaries. TASA or the TASA Subsidiaries as
lessee have the right under valid leases to occupy, use, possess and control all
property leased by them as now occupied, used, possessed and controlled by them.
The assets and properties owned or leased by TASA and the TASA Subsidiaries are
sufficient to operate and conduct their business in a manner consistent with at
least the same standards of quality and reliability as have been achieved as of
the date hereof. At the Closing, TASA and the TASA Subsidiaries will own, free
and clear of all Liens, encumbrances or claims whatsoever, other than those
permitted or disclosed hereunder, all the assets (including without limitation
all cash) included in the June 30, 1998 balance sheet included in the Interim
Financial Statements and all assets acquired since that date, other than assets
disposed of in the ordinary course of business.
(b) Each lease or agreement under which TASA or any TASA Subsidiary is a
lessee or lessor of any property, real or personal, is a valid and binding
agreement
-15-
of such Person and, to the best knowledge of TASA, the other party thereto (in
each case with such exceptions as are, individually or in the aggregate, not
material and do not, individually or in the aggregate, materially interfere with
the use made and proposed to be made of such properties by TASA), without any
default by TASA and the TASA Subsidiaries thereunder and, to the best knowledge
of TASA, without any default thereunder by any other party thereto. No event
has occurred and is continuing which, with due notice or lapse of time or both,
would constitute a default or event of default by TASA or any TASA Subsidiary
under any such lease or agreement or, to the best knowledge of TASA and the TASA
Subsidiaries by any other party thereto. TASA and the TASA Subsidiaries
possession of such property has not been disturbed and no claim has been
asserted in writing against TASA or any TASA Subsidiary adverse to its rights in
such leasehold interests. Each Shareholder agrees that, in the event that such
Shareholder leaves the employ of TASA or any TASA Subsidiary, such Shareholder
shall be responsible personally for payments under any automobile leases entered
into by TASA or any TASA Subsidiary on behalf of such Shareholder, if
applicable.
SECTION 2.16. CONDITION OF PROPERTY AND RELATED MATTERS.
(a) All buildings, structures, appurtenances and material items of
machinery, equipment and other material tangible assets used by TASA and the
TASA Subsidiaries are in good operating condition and repair, normal wear and
tear excepted, are usable in the ordinary course of business, are adequate and
suitable for the uses to which they are being put and conform in all material
respects to all applicable laws, ordinances, codes, rules, regulations and
authorizations relating to their construction, use and operation. None of their
premises or equipment are in need of maintenance or repairs other than ordinary
routine maintenance and repairs which are not material, individually or in the
aggregate, in nature or cost.
(b) All properties and tangible assets reflected in the latest balance
sheet included in the Financial Statements have a fair market or realizable
value at least equal to the value thereof as reflected therein.
(c) The accounts receivable of all kinds of TASA and the TASA
Subsidiaries, net of the allowance for doubtful accounts applicable thereto
included in the latest balance sheet included in the Financial Statements, are
collectible in full over the period of usual trade terms (by use of TASA's
normal collection methods without resort to litigation or reference to a
collection agency), and there do not exist any defenses, counterclaims and
set-offs which would materially adversely affect such receivables, including
fees returnable to the payor for unsuccessful placements,
-16-
and all such receivables are actual and bona fide receivables representing
obligations for the total dollar amount thereof shown on TASA's books. TASA and
the TASA Subsidiaries have fully performed all obligations with respect thereto
which they were obligated to perform to the date hereof. TASA delivered to TMP
an aging schedule for the accounts receivable as of June 30, 1998.
SECTION 2.17. CONTRACTS.
(a) The TASA Disclosure Schedule contains a complete list of all currently
effective written or oral (i) employment contracts, arrangements or policies
(including without limitation any collective bargaining contract or union
agreement) of TASA and the TASA Subsidiaries which may not be immediately
terminated without penalty (or any augmentation or acceleration of benefits);
(ii) leases, sales contracts and other agreements with respect to any property,
real or personal, of TASA and the TASA Subsidiaries, except for leases of
personal property involving less than $25,000 individually; (iii) contracts or
commitments for capital expenditures or acquisitions in excess of $50,000 for
one project or set of related projects; (iv) agreements, contracts, indentures
or other instruments relating to the borrowing of money, or the guarantee of any
obligation (third party or otherwise) for the borrowing of money; (v) contracts
or agreements providing for any covenant not to compete by TASA and the TASA
Subsidiaries or otherwise restricting in any way any of them engaging in any
business activity (including a description of the businesses to which the
covenant not to compete applies); (vi) contracts or agreements relating to
consultancies, professional retentions, agency, sales or distributorship
arrangements pertaining to TASA and the TASA Subsidiaries or their respective
products or activities; (vii) contracts, agreements or commitments requiring
TASA and the TASA Subsidiaries to indemnify or hold harmless any Person (other
than purchase orders entered into in the ordinary course of business and
consistent with past practice); (viii) all contracts with any customer or
supplier listed on the TASA Disclosure Schedule pursuant to Section 2.23 hereto
other than outstanding purchase orders in the ordinary course of business; and
(ix) contracts, agreements, arrangements or commitments, other than the
foregoing, which could reasonably be considered material to the business of any
member of TASA and the TASA Subsidiaries (all agreements, arrangements or
commitments to which any of them is a party, whether or not listed on the TASA
Disclosure Schedule, being hereinafter referred to as "TASA CONTRACTS"). True
and correct copies of all the TASA Contracts listed on the TASA Disclosure
Schedule have been furnished to TMP. All TASA Contracts are valid and binding
in all material respects and TASA or the TASA Subsidiaries have duly performed
their respective obligations thereunder in all material respects to the extent
such obligations have accrued, and no breach or default thereunder by them or,
to the best knowledge of TASA, any other party
-17-
thereto has occurred that could impair the ability of TASA or the TASA
Subsidiaries to enforce any material rights thereunder. There are no material
liabilities of TASA or the TASA Subsidiaries or, to the best knowledge of TASA,
any other party to any of the TASA Contracts arising from any breach of or
default in any provision thereof, nor has there occurred any breach or default
thereof by any of TASA or the TASA Subsidiaries which would permit the
acceleration of any obligation of any party thereto or the creation of a lien or
encumbrance upon any material asset(s) of any of them. There are no
negotiations pending or in progress to revise any material terms of such TASA
Contracts.
SECTION 2.18. EMPLOYEE AND LABOR MATTERS AND PLANS.
(a) Except as set forth in this Section 2.18, neither TASA nor any of the
TASA Subsidiaries has any Employee Plans.
(b) The TASA Disclosure Schedule sets forth a description of TASA's
vacation, medical and sick leave policies, copies of which have previously been
delivered to TMP.
(c) The consummation of the transactions contemplated by this Agreement
will not (either alone or in conjunction with another event, such as a
termination of employment or other services) entitle any employee or other
person to receive severance or other compensation which would not otherwise be
payable absent the consummation of the transactions contemplated by this
Agreement.
(d) The TASA Disclosure Schedule sets forth a complete and accurate list
showing the names, the rate of compensation (and the portions thereof
attributable to salary and bonuses, respectively) and location of all current
employees of TASA and the TASA Subsidiaries that received, for the year ended
December 31, 1997, or are expected to receive, during the year ending December
31, 1998, annual base salary or other compensation in excess of $100,000 (or the
equivalent thereof in foreign currency). There are no covenants, agreements or
restrictions to which TASA or the TASA Subsidiaries are a party, including but
not limited to employee non-compete agreements, prohibiting, limiting or in any
way restricting any officer or employee listed on the TASA Disclosure Schedule
from engaging in any types of business activity in any location. To the best
knowledge of TASA, no officer or employee listed on the TASA Disclosure
Schedule, and no group of employees has any plans to terminate their employment.
There has not been, and TASA does not anticipate, any adverse change in
relations with employees as a result of the announcement of the transactions
contemplated by
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this Agreement. TASA has not instituted any "freeze" of, or delayed or deferred
the grant of, any cost-of-living or other salary adjustments for any of its
employees.
(e) The TASA Disclosure Schedule sets forth by number and employment
classification the approximate numbers of employees employed by each TASA
Subsidiary as of the date of this Agreement, and, except as set forth therein,
none of said employees are subject to union or collective bargaining agreements.
There have been no audits of the equal employment opportunity practices of TASA
or the TASA Subsidiaries and, to the best knowledge of TASA, no basis for such
claim exists. There is no unfair labor practice charge or complaint against
TASA or the TASA Subsidiaries pending before the National Labor Relations Board
or similar foreign agency or strike, dispute, slowdown or stoppage pending or
threatened against or involving TASA or the TASA Subsidiaries and none has
occurred since January 1, 1993. No representation question exists respecting
the employees of TASA or the TASA Subsidiaries and no collective bargaining
agreement is currently being negotiated by TASA or the TASA Subsidiaries, nor is
any grievance procedure or arbitration proceeding pending under any collective
bargaining agreement and no claim therefor has been asserted. Neither TASA nor
any TASA Subsidiary has received notice from any union or employees setting
forth demands for representation, elections or for present or future changes in
wages, terms of employment or working conditions.
(f) The TASA Disclosure Schedule sets forth all outstanding loans and
other advances (other than travel advances in the ordinary course of business
which do not exceed $15,000 per individual) made by TASA to any of its officers,
directors, employees, shareholders or consultants.
(g) TASA and each of the TASA Subsidiaries has completed all the necessary
deductions for social security taxes pursuant to the requirements under the laws
of the applicable jurisdiction and each has correctly and truthfully and
submitted them at the correct time.
(h) TASA and each of the TASA Subsidiaries has a pension plan for all
full-time and part-time employees which is drawn up and operated in accordance
with the legal and statutory conventions and regulations and which will at least
yield the legally required payments in the jurisdictions where such plans are
required, and such liabilities are accrued for on the Closing Balance Sheet in
accordance with U.S. generally accepted accounting principles.
-19-
(i) TASA and each of the TASA Subsidiaries has insured all its full-time
and part-time workers against industrial and non-industrial accidents to the
extent required by law.
(j) Each of TASA and the TASA Subsidiaries has completed all the necessary
statements for any required pension plan and accident insurance correctly and
truthfully and submitted them at the correct time.
(k) TASA and each of the TASA Subsidiaries has paid all the assessed
social security payments, pension plans payments, unemployment insurance
payments and accident insurance payments which have fallen due and those which
have not yet fallen due have been take into account up to the accounting date in
the balance sheet as of the Balance Sheet Date, and elsewhere in the company
books, and sufficient reserves have been set aside in the balance sheet as of
the Balance Sheet Date, for all such accumulated obligations which have not yet
been assessed.
SECTION 2.19. INSURANCE POLICIES. The TASA Disclosure Schedule contains a
correct and complete description of all insurance policies covering TASA and the
TASA Subsidiaries. Each such policy is in full force and effect and, to the
best knowledge of TASA, is adequate in coverage and amount to insure fully
against risks to which TASA or the TASA Subsidiaries and their employees,
businesses, properties and other assets may be exposed in the operation of their
respective business. All retroactive premium adjustments under any worker's
compensation policy or any other policy have been recorded in the Financial
Statements in accordance with generally accepted accounting principles and are
reflected in the Financial Statements. All premiums with respect to such
insurance policies have been paid on a timely basis, and no notice of
cancellation or termination has been received with respect to any such policy.
No notice or claim has not been made in due and timely fashion. There are no
pending claims against such insurance by or on behalf of any member of TASA as
to which the insurers have denied coverage or otherwise reserved rights.
SECTION 2.20. RECORDS. TASA and the TASA Subsidiaries have records that
accurately and validly reflect its transactions and accounting controls
sufficient to insure that such transactions are (i) in all material respects
executed in accordance with its management's general or specific authorization
and (ii) recorded in conformity with generally accepted accounting principles.
SECTION 2.21. BROKERAGE FEES. Neither TASA nor any of the Shareholders
has retained any financial advisor, broker, agent or finder or paid or agreed to
pay
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any financial advisor, broker, agent or finder on account of this Agreement or
any transaction contemplated hereby or any transaction of like nature that would
be required to be paid.
SECTION 2.22. CUSTOMERS.
(a) The TASA Disclosure Schedule lists all customers that paid TASA during
the year ended December 31, 1997 or that TASA expects will pay to TASA during
the year ending December 31, 1998, more than two percent of TASA's revenues as
reflected on TASA's statement of operations for such year.
(b) TASA has no information which might reasonably indicate that any of
the customers TASA listed on the TASA Disclosure Schedule intend to cease
dealing with TASA, nor has any information been brought to its attention which
might reasonably lead it to believe any such customer intends to alter in any
material respect the amount of such purchases, sales or the extent of dealings
with TASA or would alter in any material respect such dealings in the event of
the consummation of the Acquisition.
SECTION 2.23. INTELLECTUAL PROPERTIES. The TASA Disclosure Schedule
contains an accurate and complete list of all domestic and foreign patents,
patent applications, patent licenses, software licenses (other than generally
available pre-packaged "off-the-shelf" software) and know-how licenses, trade
names, trademarks, copyrights, service marks, trademark registrations and
applications, service xxxx registrations and applications, and copyright
registrations and applications and any financial and operational management
information systems and databases, owned (in whole or in part), licensed to any
extent or used or anticipated to be used by TASA in the conduct of its business
(collectively, the "INTELLECTUAL PROPERTY"). TASA or a TASA Subsidiary either
owns all right, title and interest in and to, or possesses the exclusive right
to use, the Intellectual Property, trade secrets and technology used in the
conduct of their business (including, without limitation, the exclusive right to
use and license the same (in the jurisdiction(s) where registered in the case of
trademarks, service marks and copyrights)) and each item constituting part of
the Intellectual Property in which TASA or a TASA Subsidiary has an ownership or
license interest has been, to the extent indicated on the TASA Disclosure
Schedule, duly registered with, filed in or issued by, as the case may be, the
United States Patent and Trademark Office or such other Governmental Entities,
domestic or foreign, as are indicated on the TASA Disclosure Schedule and such
registrations, filings and issuances remain in full force and effect. Since
January 1, 1993 no claim of infringement or misappropriation of patents,
trademarks, trade names, service marks, copyrights or trade secrets of any
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other Person has been made nor, to the best knowledge of TASA, threatened
against TASA or a TASA Subsidiary and, to the best knowledge of TASA, is
infringing or misappropriating any patents, trademarks, trade names, service
marks, copyrights or trade secrets of any other Person. Without limiting any
other provisions hereof, neither TASA nor any TASA Subsidiary has granted any
license, franchise or permit to any Person to use any of the Intellectual
Property and no other Person has the right to use the same trademarks, service
marks or trade names used by TASA and the TASA Subsidiaries or any similar
trademarks, service marks or trade names likely to lead to confusion. Since
January 1, 1993, the business conducted by TASA and the TASA Subsidiaries have
not been conducted under any corporate, trade or fictitious name. The TASA
Disclosure Schedule sets forth all trademark registrations and applications,
service xxxx registrations and applications and copyright registrations and
applications abandoned by TASA and the TASA Subsidiaries since January 1, 1993.
SECTION 2.24. LICENSES. TASA and the TASA Subsidiaries have all material
licenses, permits and other governmental certificates, authorizations and
approvals required by every Federal, state, local and foreign Governmental
Entity for the conduct of their business and the use of their properties as
presently conducted or used including, without limitation, all material licenses
required under Environmental Laws and any Federal, state, local or foreign law
relating to public health and safety, or employee health and safety
(collectively, "TASA LICENSES"). The TASA Disclosure Schedule contains a true
and complete list of the TASA Licenses, exclusive of any TASA Licenses with
respect to state or local sales, use or other Taxes. All of the TASA Licenses
are in full force and effect and no action or claim is pending nor, to the best
of TASA's knowledge, is threatened to revoke or terminate any TASA License or
declare any TASA License invalid in any material respect. TASA has taken all
necessary action to maintain such TASA Licenses. The TASA Disclosure Schedule
contains a true and complete list of all local and foreign governmental or
judicial consents, orders, decrees and other compliance agreements relating to
TASA or the TASA Subsidiaries or any of their respective assets or business
under which TASA or the TASA Subsidiaries is operating or bound.
SECTION 2.25. NO ILLEGAL OR IMPROPER TRANSACTIONS. Neither TASA nor the
TASA Subsidiaries has, nor has any of their respective directors, officers or
employees, directly or indirectly used funds or other assets of TASA or the TASA
Subsidiaries, or made any promise or undertaking in such regard, for (a)
contributions, gifts, entertainment or other expenses relating to political
activity which would be illegal in the countries where made; (b) payments to or
for the benefit of governmental officials or employees, whether domestic or
foreign which would be illegal in the countries where made; (c) payments to or
for the benefit of
-22-
any person, firm, corporation or other entity, or any director, officer,
employee, agent or representative thereof which would be illegal in the
countries where made; or (d) the establishment or maintenance of a secret or
unrecorded fund; and there have been no false or fictitious entries made in
TASA's books or records.
SECTION 2.26. OWNERSHIP OF TMP COMMON STOCK. Neither TASA, any TASA
Subsidiary nor any Shareholder, directly or indirectly, own any shares of TMP
Common Stock.
SECTION 2.27. RESTRICTIVE DOCUMENTS AND TERRITORIAL RESTRICTIONS. Neither
TASA nor the TASA Subsidiaries is subject to, or a party to, any charter,
by-law, mortgage, Lien, lease, license, permit, agreement, contract, instrument,
law, rule, ordinance, regulation, order, judgment or decree, or any other
restriction of any kind or character, which materially adversely affects the
business, prospects, operations or condition (financial or otherwise) of TASA or
the TASA Subsidiaries or any of their assets or property, or which would prevent
consummation of the transactions contemplated hereby, or the continued operation
of TASA's or the TASA Subsidiaries' business after the date hereof on
substantially the same basis as heretofore operated or which would restrict the
ability of TASA or the TASA Subsidiaries to acquire any property or conduct
business in any area.
SECTION 2.28. SECURITIES ACT MATTERS. Each Shareholder, severally and not
jointly, hereby represents and warrants as follows:
(a) Unless otherwise set forth on the TASA Disclosure Schedule, it is
the record and beneficial owner of the outstanding shares of TASA's Common Stock
set forth on Schedule A hereto, and owns such shares free and clear of all
Liens, restrictions and other encumbrances (other than restrictions imposed by
United States, state and foreign securities laws).
(b) It acknowledges that its representations and warranties contained
herein are being relied upon by TMP as a basis for the exemption of the issuance
of the TMP Common Stock hereunder from the registration requirements of the
Securities Act and any applicable state securities laws.
(c) It understands that (i) the TMP Common Stock has not been
registered under the Securities Act or any state securities laws by reason of
its issuance in a transaction exempt from the registration requirements of the
Securities Act and applicable state securities laws and (ii) the TMP Common
Stock must be held indefinitely unless a subsequent disposition thereof is
registered under the
-23-
Securities Act and applicable state securities laws pursuant to Section 6.10 or
otherwise, or is exempt from such registration.
(d) It is acquiring the TMP Common Stock set forth on Schedule A
hereto for its own account and not with a view to, or for sale in connection
with, directly or indirectly, any distribution thereof that would require
registration under the Securities Act or applicable state or foreign securities
laws or would otherwise violate the Securities Act or such state or foreign
securities laws.
(e) It has relied upon independent investigations made by it or its
specifically appointed personal representatives and is fully familiar with the
business, results of operations, financial condition, prospects and other
affairs of TMP and realizes that the TMP Common Stock is a speculative
investment involving a high degree of risk for which there is no assurance of
any return. It has such knowledge and experience in financial and business
affairs, including investing in companies similar to TMP, and is capable of
determining the information necessary to make an informed investment decision,
of requesting such information from TMP, and of utilizing the information that
it has received from TMP to evaluate the merits and risks of its investment in
the TMP Common Stock. It is able to bear the economic risk of its investment in
the TMP Common Stock and understands that it must do so for an indefinite period
of time.
(f) It and its personal attorneys, accountants, investment and
financial advisors, if any, have had the opportunity to review the books and
records of TMP and have been provided access to such information as it or its
advisors, if any, have requested. It acknowledges that it has received and
carefully reviewed copies of (i) this Agreement, and all exhibits and schedules
attached hereto, (ii) the TMP Exchange Act Filings and (iii) all other reports
delivered to TASA pursuant to Section 5.01 hereof (collectively, the
"STOCKHOLDER INFORMATION").
(g) Each Shareholder acknowledges that no action has been taken that
would permit an offering of shares of TMP Common Stock to the public in the
jurisdiction in which such Shareholder is resident or located or in any other
jurisdiction where action for that purpose would be required and, accordingly,
no shares of TMP Common Stock may be resold in any jurisdiction in any manner
that would result in the characterization of the transactions contemplated
hereby or the offer of TMP Common Stock as a public offering.
(h) Each Shareholder is aware that no federal, state, foreign or
other agency has passed upon or made any finding or determination concerning the
fairness of the transactions contemplated hereby or the adequacy of the
disclosure
-24-
of the exhibits and schedules to this Agreement and the Stockholder Information,
and such Shareholder must forego the security, if any, that such a review would
provide.
(i) It understands and acknowledges that neither the United States
Internal Revenue Service nor any foreign tax authority has been asked to rule on
the tax consequences of the Acquisition and, accordingly, in making its decision
to approve the Acquisition it has relied upon the investigations of its own tax
and business advisers in addition to its own independent investigations as to,
and that it and its advisors have fully considered all, the tax consequences of
the Acquisition.
(j) It has been advised or is aware of the provisions of Rule 144
promulgated under the Securities Act, which permits limited resale of securities
purchased in a private placement subject to the satisfaction of certain
conditions, including, among other things: the availability of certain current
public information about TMP, and compliance with applicable requirements
regarding the holding period and the amount of securities to be sold and the
manner of sale; and that such rule may not be available for resale of the Common
Stock.
(k) It represents and warrants that in making its decision to approve
the Acquisition, it and its professional tax and business advisors have been
given the opportunity to discuss TMP's business, management and financial
affairs with TMP's management, and has had the opportunity to examine all
relevant documents and to ask questions of, and to receive answers from TMP or
any person(s) acting on TMP's behalf concerning the terms and conditions of the
Acquisition or any other matter set forth in this Agreement and the schedules
and exhibits hereto, and to obtain any additional information necessary to
verify the accuracy of the information set forth herein or therein. It
represents and warrants that it desires no further information for such
evaluation.
(l) It has delivered to TMP a certificate in the form of EXHIBIT
2.28(L) hereto, certifying as to its status as an Accredited Investor or
non-U.S. Person.
(m) It understands that the TMP Common Stock will bear the following
legend (or a substantially similar legend):
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR QUALIFIED UNDER ANY STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF WITHOUT SUCH REGISTRATION OR THE DELIVERY TO THE COMPANY OF AN
OPINION OF
-25-
COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH DISPOSITION
WILL NOT REQUIRE REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED."
SECTION 3.29. NO MISLEADING STATEMENTS. This Agreement, the information
and schedules referred to herein and the information that has been furnished to
TMP in connection with the transactions contemplated hereby do not include any
untrue statement of a material fact and do not omit to state any material fact
necessary to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading. There is no fact
known to TASA or the Shareholders which materially adversely affects or in the
future may (so far as they can now reasonably foresee) materially adversely
affect the business, condition (financial or otherwise), property or assets of
TASA which has not been set forth herein.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF TMP
Except as set forth (by reference to the applicable Section of this
Agreement) in the disclosure schedule of TMP previously delivered to TASA (the
"TMP DISCLOSURE SCHEDULE"), TMP hereby agrees and represents and warrants to
TASA, the TASA Subsidiaries and each Shareholder individually as follows:
SECTION 3.01. ORGANIZATION, ETC. TMP is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has full corporate power and authority to conduct its business as it is now
being conducted and to own, operate or lease the properties and assets it
currently owns, operates or holds under lease. TMP has all requisite corporate
power and authority to enter into this Agreement and each of the other
agreements contemplated hereby, to carry out its obligations under this
Agreement and each of the other agreements contemplated hereby and to consummate
the transactions contemplated hereby and thereby.
SECTION 3.02. CAPITALIZATION. The authorized capital stock of TMP
consists of 240,000,000 shares of stock, consisting of (a) 1,000,000 shares of
preferred stock, none of which are issued, and (b) 39,000,000 shares of Class B
Common Stock, $.001 par value, of which 2,381,000 are issued and outstanding as
of August 7, 1998, and 200,000,000 shares of TMP Common Stock, of which
24,629,158 shares are issued and outstanding as of August 7, 1998. There are no
shares of TMP Common Stock
-26-
held as treasury shares. All outstanding shares of TMP Common Stock have been
duly authorized and validly issued and are fully paid and non-assessable. All
of the outstanding shares of TMP Common Stock were issued in compliance with all
applicable Federal and state securities laws. None of the outstanding
securities has been issued in violation of any pre-emptive rights, rights of
first refusal or similar rights. The issuance and delivery by TMP of the TMP
Common Stock pursuant to this Agreement has been duly authorized by all
necessary corporate action on the part of TMP. Upon delivery of the
certificates for the TMP Common Stock in accordance with the terms of this
Agreement, such shares of TMP Common Stock will be validly issued, fully paid
and non-assessable.
SECTION 3.03. AUTHORIZATION. The execution and delivery by TMP of this
Agreement, the consummation of the transactions contemplated hereby and the
performance by TMP of its obligations hereunder have been duly authorized by all
necessary corporate action. This Agreement has been duly executed and delivered
by TMP and constitutes the legal, valid and binding obligation of TMP,
enforceable against TMP in accordance with its terms.
SECTION 3.04. NO VIOLATION. The execution and delivery of this Agreement
by TMP do not, and the consummation by TMP of the transactions contemplated
hereby, and compliance with the terms hereof will not, (a) conflict with, or
result in any violation of or default or loss of any benefit under, any
provision of TMP's Certificate of Incorporation or By-laws or Holding's
Memorandum and Articles of Association; (b) conflict with, or result in any
violation of or default or loss of any benefit under, any permit, concession,
grant, franchise, law, rule or regulation, or any judgment, decree or order of
any court or other governmental agency or instrumentality to which TMP is a
party or to which any of its property is subject; (c) conflict with, or result
in a breach or violation of or default or loss of any benefit under, or
accelerate the performance required by, the terms of any material agreement,
contract, indenture or other instrument to which TMP is a party or to which any
of its property is subject, or constitute a default or loss of any right
thereunder or an event which, with the lapse of time or notice or both, might
result in a material default or loss of any material right thereunder or the
creation of any lien, charge or encumbrance upon any of the assets or properties
of TMP; or (d) result in any suspension, revocation, impairment, forfeiture or
nonrenewal of any material TMP License. TMP is in compliance with all
applicable laws, rules or regulations relating to or affecting the operation,
conduct or ownership of its property or business, other than violations that
individually or in the aggregate would not, and insofar as may reasonably be
foreseen in the future will not, have a Material Adverse Effect.
-27-
SECTION 3.05. APPROVALS. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by TMP will not require
the consent, approval, order or authorization of any Governmental Entity or
Regulatory Authority or any other Person under any statute, law, rule,
regulation, permit, license, agreement, indenture or other instrument to which
TMP is a party or to which any of its properties are subject, and no
declaration, filing or registration with any Governmental Entity or Regulatory
Authority is required or advisable by TMP in connection with the execution and
delivery of this Agreement, the consummation by TMP of the transactions
contemplated hereby, or the performance by TMP of its obligations hereunder,
other than such filings or registrations with, or authorizations, consents or
approvals of, governmental bodies, agencies, officials or authorities, the
failure of which to make or obtain would not have a Material Adverse Effect.
SECTION 3.06. SEC FILINGS. (a) TMP have delivered to TASA (i) TMP's
Annual Report on Form 10-K for the fiscal year ended December 31, 1997, TMP's
proxy statement dated April 27, 1998, TMP's Quarterly Report on Form 10-Q/A for
its fiscal quarter ended March 31, 1998 and TMP's Quarterly Report on Form 10-Q
for its fiscal quarter ended June 30, 1998. The TMP Exchange Act Filings, as of
their respective filing dates, did not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.
(b) Since March 31, 1998, except as disclosed in TMP's press releases,
there has been no Material Adverse Change in the assets or liabilities, or in
the business or condition, financial or otherwise, of TMP, or in the results of
operations or, to the best knowledge of TMP, prospects, of TMP, whether as a
result of any legislative or regulatory change, revocation of any license or
right to do business, fire, explosion, accident, casualty, labor trouble, flood,
drought, riot, storm, condemnation or act of God or otherwise.
SECTION 3.07. NO MISLEADING STATEMENTS. This Agreement, the information
and schedules referred to herein and the information that has been furnished to
TASA by TMP in connection with the transactions contemplated hereby do not
include any untrue statement of a material fact and do not omit to state any
material fact necessary to make the statements contained herein or therein, in
light of the circumstances under which they were made, not misleading. There is
no fact known to TMP which materially adversely affects or in the future may (so
far as TMP can now reasonably foresee) materially adversely affect the business,
-28-
condition (financial or otherwise), property or assets of TMP which has not been
set forth herein.
SECTION 3.08. SUFFICIENT FINANCIAL RESOURCES. TMP has available to it
sufficient financial resources to complete the transactions contemplated hereby
in accordance with the terms of this Agreement. For Swiss tax purposes, TMP
shall neither directly nor indirectly finance the Stock Consideration and/or any
other payments to the Shareholders under the Agreement out of financial
resources of (i) TASA, (ii) the TASA Subsidiaries, or (iii) the Shareholders.
ARTICLE IV
COVENANTS OF TASA
AND THE SHAREHOLDERS
TASA and the Shareholders, jointly and severally, agree that:
SECTION 4.01. CONDUCT OF TASA AND THE TASA SUBSIDIARIES. From the date
hereof until the Closing, TASA shall, and shall cause the TASA Subsidiaries to,
in all material respects conduct their business in the ordinary course. Without
limiting the generality of the foregoing, from the date hereof until the
Closing, except as contemplated hereby, without the written consent of TMP:
(a) TASA and the TASA Subsidiaries will not adopt or propose any
change in their respective Memorandum or Articles of Association, or enter into
any agreement or incur any obligation, the terms of which would be violated by
the consummation of the transactions contemplated by this Agreement;
(b) Except as contemplated by this Agreement or as previously
approved by TMP in writing, TASA and the TASA Subsidiaries will not:
(i) enter into any written contract, agreement, plan or
arrangement covering any director, officer or employee of TASA and the TASA
Subsidiaries that provides for the making of any payments, the acceleration
of vesting of any benefit or right or any other entitlement contingent upon
(A) the Acquisition or (B) the termination of employment after the
Acquisition;
(ii) enter into or amend any employment agreements (oral or
written) to increase the compensation payable or to become payable by
-29-
it to any of its employees or otherwise materially alter its employment
relationship with, officers, directors or consultants over the amount
payable as of the date hereof, or increase the compensation payable to any
other employees (other than (A) increases in the ordinary course of
business which are not in the aggregate material to TASA and the TASA
Subsidiaries, taken as a whole, or (B) pursuant to plans disclosed in the
TASA Disclosure Schedule), or adopt or, except as required by applicable
law to maintain a plan's tax-qualified status, amend any employee benefit
plan or arrangement (oral or written); or
(iii) loan or advance any money to any officer, director,
employee, shareholder or consultant of TASA and the TASA Subsidiaries,
other than travel advances in the ordinary course of business which do not
exceed $15,000 at any time outstanding to any one person;
(c) Except for the transfer of the TASA Common Stock held by TASA
International NV Curacao to TASA, TASA and the TASA Subsidiaries will not
(i) purchase, acquire, issue, deliver, sell or authorize the issuance, delivery
or sale of any stock appreciation rights or of any shares of their capital stock
or of any class or any securities convertible into or exchangeable for, or
rights, warrants or options to acquire, any such shares or convertible or
exchangeable securities, (ii) make any changes in their capital structure or
(iii) enter into any agreement or understanding or take any preliminary action
with respect to the matters referred to in clause (i) or (ii) of this paragraph
(c);
(d) TASA and the TASA Subsidiaries will keep in full force and effect
its existing insurance policies and will not modify or reduce the coverage
thereunder;
(e) TASA and the TASA Subsidiaries will not (i) pay any dividend or
make any other distribution to holders of its or their capital stock (other than
dividends paid by a TASA Subsidiary to TASA), (ii) split, combine or reclassify
any of its or their capital stock or propose or authorize the issuance of any
other securities in respect of or in lieu of or in substitution for any shares
of its or their capital stock, (iii) repurchase, redeem or otherwise acquire any
shares of its or their capital stock or (iv) take any preliminary action with
respect thereto;
(f) TASA and the TASA Subsidiaries will not incur any additional
indebtedness for borrowed money (including, without limitation, by way of
guarantee or the issuance and sale of debt securities or rights to acquire debt
securities) other than by way of draws in the ordinary course of business on
existing
-30-
bank facilities disclosed on the TASA Disclosure Schedule, or incur any account
payable except in the ordinary course of business, or enter into or modify any
contract, agreement, commitment or arrangement with respect to the foregoing;
(g) TASA and the TASA Subsidiaries will not enter into any
transaction that would, in the reasonable judgment of TMP, delay the occurrence
of the Closing beyond October 31, 1998;
(h) TASA and the TASA Subsidiaries will not (i) sell, lease or
otherwise dispose of any of its assets having a book or market value in excess
of $50,000 in the aggregate or that are otherwise material, individually or in
the aggregate, to the business, results of operations or financial condition of
TASA and the TASA Subsidiaries or (ii) enter into, or consent to the entering
into of, any agreement granting a preferential right to sell, lease or otherwise
dispose of any of such assets;
(i) TASA and the TASA Subsidiaries will not (i) enter into any new
line of business; (ii) change its investment, liability management and other
material policies in any material respect; (iii) incur or commit to any capital
expenditures, obligations or liabilities in connection therewith other than
capital expenditures, obligations or liabilities that (a) are listed on the TASA
Disclosure Schedule or (b) individually do not exceed $50,000 and in the
aggregate do not exceed $150,000; (iv) acquire or agree to acquire by merging or
consolidating with, or acquire or agree to acquire by purchasing a substantial
portion of the assets of, or in any other manner, any business or Person;
(v) otherwise, except as to the acquisition of materials and supplies for its
products and activities in the ordinary course of business and consistent with
past practices, acquire or agree to acquire any assets for a total consideration
in the aggregate in excess of $50,000; or (vi) make any investment in any
Person;
(j) TASA will not, and will not permit any TASA Subsidiary to, (i)
change its methods of accounting in effect at December 31, 1997 except as
required by changes in generally accepted accounting principles concurred in by
Xxxxxx Xxxxxxxx LLP, TASA's independent auditors; (ii) change any of its methods
of accounting for income and deductions for income tax purposes from those
employed in the preparation of the income tax returns for the taxable year ended
December 31, 1997; or (iii) change its fiscal year;
(k) TASA and the TASA Subsidiaries will not settle or compromise, or
agree to settle or compromise, any suit or other litigation matter or matter in
an arbitration proceeding for any material amount (after taking into account any
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insurance proceeds to which TASA or such TASA Subsidiary is entitled) or
otherwise on terms which would have a Material Adverse Effect;
(l) TASA will not (i) transfer, sell or otherwise dispose of, or
grant to any Person any right to acquire, the shares of the TASA Subsidiaries
owned by it.
SECTION 4.02. ACCESS TO RECORDS. At all reasonable times from and after
the date hereof until the Closing, TASA and the TASA Subsidiaries shall afford
TMP, and its accountants, counsel, financial advisors and other representatives
full and complete access to the properties, employees and officers of TASA and
the TASA Subsidiaries and to all books, accounts, financial and other records
and contracts of every kind; provided, however, that no investigation pursuant
to this Section shall affect any representation or warranty given by TASA to TMP
hereunder. TASA and the TASA Subsidiaries shall also furnish to TMP as promptly
as practicable (i) following the end of each calendar month, consolidated and
consolidating balance sheets and related statements of operations of TASA as of
the end of such month commencing with the month ended June 30, 1998 (all such
financial statements shall be covered by and conform to the representations and
warranties set forth in Section 2.07(b) hereof and shall be included in the term
"Financial Statements" for purposes of this Agreement); and (ii) all financial
and operating data and other information concerning TASA's business, properties
and personnel as TMP may request. Before the Closing, TASA and the TASA
Subsidiaries will, as requested by TMP, make available on a regular and frequent
basis the officers and other appropriate employees of TASA and the TASA
Subsidiaries to discuss with representatives of TMP the condition, operations,
business and prospects of TASA and the TASA Subsidiaries. TMP will, and will
cause its accountants, counsel, financial advisor and other representatives to,
comply with reasonable policies established by TASA with respect to access to
TASA's employees, officers and facilities.
SECTION 4.03. NO OTHER BIDS. None of TASA, the TASA Subsidiaries or the
Shareholders shall, nor shall they authorize or permit any officer, director or
employee of, or any investment banker, attorney, accountant or other
representative retained by, TASA or the TASA Subsidiaries to, (i) encourage,
solicit or initiate any inquiries or the making of any proposal that may
reasonably be expected to lead to any "takeover proposal" or (ii) participate in
any discussions or negotiations, or provide third parties with any information,
relating to any such inquiry or proposal. TASA shall immediately advise TMP of
any such inquiries or proposals. As used in this Section 4.03, "TAKEOVER
PROPOSAL" shall mean any proposal for a merger or other Business Combination
involving, directly or indirectly, TASA or any TASA Subsidiary, a substantial
equity interest in TASA or any TASA Subsidiary or
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a substantial portion of the assets of TASA or any TASA Subsidiary, in each case
other than the transactions contemplated hereby, and "SUBSTANTIAL EQUITY
INTEREST" shall mean any equity ownership representing beneficial ownership of
five percent or more of the outstanding capital stock of TASA or any TASA
Subsidiary.
SECTION 4.04. MAINTENANCE OF BUSINESS. TASA will, and will cause each
TASA Subsidiary to, use commercially reasonable efforts to carry on its
business, keep available the services of its officers and employees and preserve
its relationships with those of its customers, suppliers, licensors, licensees
and others having business relationships with it that are material to its
business in substantially the same manner as it has prior to the date hereof.
If TASA or any TASA Subsidiary becomes aware of a material deterioration or
facts which are likely to result in a material deterioration in the relationship
with any material customer, supplier, licensor, licensee or others having
business relationships with any member of TASA or any TASA Subsidiary, it will
promptly bring such information to the attention of TMP in writing.
SECTION 4.05. COMPLIANCE WITH OBLIGATIONS. Prior to the Closing Date,
TASA will, and will cause each TASA Subsidiary to, comply with (a) all
applicable Federal, state, local and foreign laws, rules and regulations, (b)
all material agreements and obligations, including its Memorandum and Articles
of Association (or analogous organizational documents), by which it, its
properties or its assets may be bound, and (c) all decrees, orders, writs,
injunctions, judgments, statutes, rules and regulations applicable to it, its
properties or its assets.
SECTION 4.06. PRETAX OPERATING PROFIT. To the extent allowed by TMP, TASA
shall take all commercially reasonable steps to provide that operations of TASA
generate on a consolidated basis a pretax profit of 15% of Revenues for the
years ending December 31, 1999 and 2000 and 20% for the year ending December 31,
2001. Revenues shall mean the sum of (i) xxxxxxxx to clients (but not including
expenses billed), (ii) exchange gains/losses on collection of invoices billed in
other than local currency, (iii) provisions for doubtful client accounts
receivable, (iv) write-offs of client accounts receivable, (v) rebates to
clients and (vi) any other required adjustments to xxxxxxxx. The before
mentioned results are based upon the presently existing structure and personnel
which will be acquired by TMP. TMP recognizes that the management and
shareholder decisions relating to TASA after Closing will no longer be the
responsibility of the partners of TASA and TMP's decisions may impact the
generation of the above pretax operating profit targets.
SECTION 4.07. SHAREHOLDERS. The Shareholders will cause TASA to comply
with the provisions of this Article IV. Each Shareholder further agrees not to
grant
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any power of attorney with respect to the shares of TASA Common Stock, TASA or
TASA's business or assets. No Shareholder will in any way reduce their
respective risk or commit to reduce their respective risk with respect to the
shares of TASA Common Stock held by such Shareholder or the TMP Common Stock to
be acquired by such Shareholder hereunder, whether by entering into a put,
collar, option or other arrangement with respect to the shares of TMP Common
Stock constituting their portion of the Stock Consideration, until after the
publication of financial results of TMP covering at least 30 days' of
post-Closing combined operations of TMP and TASA.
ARTICLE V
COVENANTS OF TMP
SECTION 5.01. ACCESS TO RECORDS. At all reasonable times from and after
the date hereof until the Closing, TMP shall afford TASA and the Shareholders
and their respective accountants, counsel and other representatives full and
complete access to the properties, employees and officers of TMP and to all
books, accounts, financial and other records and contracts of every kind of TMP;
provided, however, that no investigation pursuant to this Section shall affect
any representation or warranty given by TMP to TASA or the Shareholders
hereunder. Before the Closing, will, as requested by TASA, make available on a
regular and frequent basis the officers and other appropriate employees of TMP
to discuss with representatives of TASA and the Shareholders the condition,
operations, business and prospects of TMP. TASA, the TASA Subsidiaries and the
Shareholders will, and will cause their respective accountants, counsel and
other representatives to, comply with reasonable policies established by TMP
with respect to access to its employees, officers and facilities.
SECTION 5.02. TREASURY SHARES. TMP shall redeem after Closing, but not
later than December 30, 1998, all of the 286 treasury shares of TASA in the
amount of CHF 2,152,906. This amount shall be deemed the purchase price to be
paid by TMP to TASA and is equal to the acquisition value paid by TASA to TASA
International NV, Curacao.
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SECTION 5.03. GENERAL MEETING OF SHAREHOLDERS OF TASA. TMP undertakes to
call an ordinary general meeting of shareholders of TASA immediately after
Closing and to hold such meeting in 1998 with respect to fiscal year 1997 and
fiscal year 1998 to the date of such meeting. To the extent possible, such
meeting shall be constituted as a meeting of all shareholders as set forth in
art 701 of the Swiss Code of Obligations. TMP shall hold such meeting not later
than December 31, 1998. In addition, TMP shall give a comprehensive discharge
to Xx. Xxxxx Xxxxxxxxx, Xxxxx Magnet and Xxxxxxx Xxxxxxx (the "TASA Directors")
at such meeting. To the best of TMP's knowledge, there are no facts or
circumstances which would prevent TMP from giving the TASA Directors a full
discharge at the general meeting of shareholders. TMP shall deliver to the TASA
Directors immediately following the general meeting of shareholders a copy of
the minutes of such meeting.
ARTICLE VI
COVENANTS OF TASA, THE SHAREHOLDERS AND TMP
TASA, the Shareholders and TMP agree that:
SECTION 6.01. JOINT TRANSITION COMMITTEE. TASA and TMP shall promptly
following the date hereof establish a joint transition committee, with
representatives of senior management of both companies, to recommend steps to be
carried out in combining the operations of the companies, to facilitate access
to information and to consult and advise with respect to major activities of
TASA pending the Acquisition; provided that such committee shall neither
operate, nor make any agreement on behalf of, any of TASA or TMP prior to the
Acquisition.
SECTION 6.02. ADVICE OF CHANGES. TASA will promptly advise TMP in writing
of:
(a) any notice or other communication from any Person alleging that
the consent of such Person is or may be required in connection with the
Acquisition;
(b) any notice or other communication from any Governmental Entity or
Regulatory Authority in connection with the Acquisition;
(c) any actions, suits, claims, investigation or other judicial
proceedings commenced or threatened against TASA or any of its Subsidiaries
which, if pending on the date of this Agreement, would have been required to
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have been disclosed pursuant to this Agreement or which relate to the
consummation of the Acquisition;
(d) any event known to TASA's executive officers occurring subsequent
to the date of this Agreement that would render any representation or warranty
of TASA contained in this Agreement, if made on or as of the date of such event
or the Closing Date, untrue, inaccurate or misleading in any material respect
(other than an event so affecting a representation or warranty which is
expressly limited to a state of facts existing at a time prior to the occurrence
of such event); and
(e) any Material Adverse Change in the business condition of TASA and
the TASA Subsidiaries, taken as a whole.
From time to time prior to the Closing, each of TASA and TMP will promptly
supplement or amend its Disclosure Schedule and the Exhibits hereto with respect
to any matter hereafter arising which, if existing or occurring at the date of
this Agreement, would have been required to be set forth or described in such
Schedule and Exhibits hereto. No supplement or amendment of a Schedule or
Exhibit made pursuant to this Section shall be deemed to cure any breach of,
affect or otherwise diminish any representation or warranty made in this
Agreement unless the other party hereto specifically agrees thereto in writing.
SECTION 6.03. REGULATORY APPROVALS. Prior to the Closing, each party
shall execute and file, or join in the execution and filing of, any application
or other document that may be necessary in order to obtain the authorization,
approval or consent of any Governmental Entity or Regulatory Authority which may
be reasonably required, or that the other company may reasonably request, in
connection with the consummation of the Acquisition. Each party shall use its
commercially reasonable efforts to obtain all such authorizations, approvals and
consents.
SECTION 6.04. ACTIONS CONTRARY TO STATED INTENT. Neither party shall, or
shall permit any of its Subsidiaries to, take any action that would, or
reasonably might be expected to, result in any of its representations and
warranties set forth herein being or becoming untrue in any material respect, or
in any of the conditions to the Acquisition set forth in Article VII not being
satisfied.
SECTION 6.05. CERTAIN FILINGS. The parties shall cooperate with one
another:
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(a) in determining whether any action by or in respect of, or filing
with, any Governmental Entity or Regulatory Authority is required, or any
actions, consents, approvals or waivers are required to be obtained from parties
to any material contracts, in connection with the consummation of the
transactions contemplated by this Agreement; and
(b) in seeking any such actions, consents, approvals or waivers or
making any such filings, furnishing information required in connection therewith
and seeking timely to obtain any such actions, consents, approvals or waivers.
SECTION 6.06. PUBLIC ANNOUNCEMENTS. TASA will consult with TMP before
issuing any press release or making any public statement with respect to this
Agreement and the transactions contemplated hereby and, except as may be
required by applicable law, will not issue any such press release or make any
such public statement (other than in response to unsolicited inquiries) prior to
such consultation. TASA will consult with TMP before issuing any other press
release or making any public statement and, except as may be required by
applicable law, will not issue any such press release or make any such public
statement without the prior consent of TMP.
SECTION 6.07. SATISFACTION OF CONDITIONS PRECEDENT. The parties hereto
will use their commercially reasonable efforts to satisfy or cause to be
satisfied all the conditions precedent that are set forth in Article VII, as
applicable to each of them, and to cause the transactions contemplated by this
Agreement to be consummated, and, without limiting the generality of the
foregoing, to obtain all consents and authorizations of third parties and to
make all filings with, and give all notices to, third parties that may be
necessary or reasonably required on its part in order to effect the transactions
contemplated hereby. Each of the parties hereto agrees to negotiate in good
faith with respect to any additional agreement reasonably requested by another
party hereto which such requesting party determines in good faith is necessary
to effect the transactions contemplated hereby.
SECTION 6.08. CONFIDENTIALITY. Each of the parties hereto agrees to
retain, and to cause their respective Subsidiaries, directors, officers,
employees and agents to retain, in strict confidence, in accordance with the
terms of the Confidentiality Agreement, all Information (as such term is defined
in the Confidentiality Agreement) received from any other party.
SECTION 6.09. TRADING PROHIBITION. Each of TASA and the Shareholders
hereby acknowledge that the transactions contemplated hereby and information
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disclosed and to be disclosed to TASA and the Shareholders and their respective
representatives may, from time to time, constitute or include material
non-public information concerning TMP. Each of TASA and the Shareholders
acknowledges that they are aware, and that they have advised and will continue
to advise all employees of TASA and any TASA Subsidiary and the representatives
of the Shareholders, TASA and the TASA Subsidiaries to whom the existence of
this transaction or any such information has been or may be disclosed by TASA,
the TASA Subsidiaries, the Shareholders or each of their respective
representatives that (i) the federal securities laws may prohibit a person who
has material, non-public information from purchasing or selling securities of
any company to which such information relates and (ii) material non-public
information shall not be communicated to any other person except as expressly
permitted by this Agreement. Between the date of this Agreement and the Closing
neither TASA nor any Shareholder will acquire, and TASA will not permit any TASA
Subsidiary to acquire, any shares of TMP Common Stock except that each of the
Shareholders may acquire their portion of the shares of TMP Common Stock
constituting the Stock Consideration at Closing as contemplated herein. Each of
the Shareholders will not reduce their risk or commit to reduce their risk with
respect to the Stock Consideration to be acquired by such Shareholder hereunder,
whether by entering into a put, collar, option, margin or other arrangement with
respect to the shares of TMP Common Stock constituting their portion of the
Stock Consideration, until after the publication of financial results of TMP
covering at least 30 days of post-Closing combined operations of TMP and TASA.
SECTION 6.10 REGISTRATION OF STOCK CONSIDERATION.
(a) REGISTRATION. TMP shall, for the benefit of the Shareholders, at
TMP's expense, use its best efforts to (i) cause to be filed with the United
States Securities and Exchange Commission (the "SEC") within 21 days after the
Closing a resale registration statement on Form S-3 or any other appropriate
form (the "Registration Statement") to register the shares of TMP Common Stock
comprising the Stock Consideration, (ii) use its best efforts to cause such
Registration Statement to be declared effective under the Securities Act of
1933, as amended (the "Securities Act") by the SEC as soon as practicable and
(iii) keep such Registration Statement effective until such time as the
Shareholders may dispose of their shares of TMP Common Stock pursuant to the
provisions of Rule 144 under the Securities Act. Each Shareholder hereby agrees
to furnish to TMP all information with respect to such Shareholder necessary to
make the disclosure in the Registration Statement with respect to such
Shareholder not materially misleading. TMP will, in the event that the
Registration Statement is declared effective, provide to each Shareholder and to
Xxxxxx, Xxxxxx, Herlands, Randolph, Xxxxxxxxx & Cox LLP, counsel to the
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Shareholders, a reasonable number of copies of the Prospectus which is a part of
the Registration Statement, notify each Shareholder when the Registration
Statement has become effective and use its best efforts to take certain other
actions as are required to permit certain unrestricted sales of the Stock
Consideration. TMP further agrees, if necessary, to supplement or amend the
Registration Statement, if required by the rules, regulations or instructions
applicable to the registration form used by TMP for such Registration Statement
or by the Securities Act or by any other rules and regulations thereunder for
resale registrations, and TMP agrees to furnish to the Shareholders copies of
any such supplement or amendment promptly after its being used or filed with the
SEC.
(b) EXPENSES. TMP shall pay all expenses in connection with the
registration pursuant to Section 6.10(a) hereof and will reimburse the
Shareholders for the reasonable fees and disbursements of Xxxxxx, Xxxxxx,
Herlands, Randolph, Xxxxxxxxx & Cox LLP, counsel for the Shareholders, incurred
in connection with the registration statement.
(c) NOTICE. In connection with the obligations of TMP with respect
to the Registration Statement pursuant to Section 6.10(a) hereof, TMP shall
notify each Shareholder of the effective date of the Registration Statement.
(d) RULE 144. For so long as TMP is subject to the reporting
requirements of Section 13 or 15 of the Exchange Act and any shares of TMP
Common Stock comprising the Stock Consideration are not freely tradable, TMP
will use its best efforts to file the reports required to be filed by it under
the Securities Act and Section 13(a) or 15(d) of the Exchange Act and the rules
and regulations adopted by the SEC thereunder, or, if it ceases to be so
required to file such reports, it will, upon the request of any Shareholder (i)
make publicly available such information as is necessary to permit sales of
securities of TMP pursuant to Rule 144 under the Securities Act and (ii) take
such further action that is reasonable in the circumstances, in each case, to
the extent required from time to time to enable such Shareholder to sell its
shares of TMP Common Stock without registration under the Securities Act within
the limitation of the exemptions provided by Rule 144 under the Securities Act,
as such rule may be amended from time to time or (b) any similar rules or
regulations hereafter adopted by the SEC.
SECTION 6.11. EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS. Prior to the
Closing, TASA shall convene an extraordinary meeting of shareholders to (i)
accept the resignations of the TASA Directors from the Board of Directors of
TASA and (ii) elect a new Board of Directors for TASA. TASA shall deliver to
TMP original copies of the minutes of such meeting. Upon receipt of the minutes
from the
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extraordinary general meeting of shareholders to be held pursuant to this
Section 6.11, TMP shall without delay file an application and such minutes with
the competent Commercial Register to register the new directors and to remove
the TASA Directors.
ARTICLE VII
CONDITIONS OF CLOSING
SECTION 7.01. CONDITIONS TO ALL PARTIES' OBLIGATIONS. The obligations of
all the parties to this Agreement to effect the Acquisition shall be subject to
the fulfillment of the following conditions:
(a) No temporary restraining order, preliminary or permanent
injunction or other order or restraint issued by any court of competent
jurisdiction, no order, decree, restraint or pronouncement by any Governmental
Entity, and no other legal restraint or prohibition which would prevent or have
the effect of preventing the consummation of the Acquisition shall have been
issued or adopted or be in effect.
(b) All material permits, approvals, filings and consents required or
advisable to be obtained or made, and all waiting periods required or
contemplated to expire, prior to the consummation of the Acquisition under
applicable federal laws of the United States or applicable laws of any state or
foreign country having jurisdiction over the Acquisition and the other
transactions contemplated herein shall have been obtained, made or expired, as
the case may be (all such permits, approvals, filings and consents and the lapse
of all such waiting periods being referred to as the "REQUISITE REGULATORY
APPROVALS"), and all such Requisite Regulatory Approvals shall be in full force
and effect.
(c) All shares of TASA Common Stock held by TASA International NV
Curacao shall be transferred to TASA prior to the Closing.
SECTION 7.02. CONDITIONS TO THE OBLIGATIONS OF TMP TO EFFECT THE
ACQUISITION. The obligations of TMP under this Agreement to effect the
Acquisition are subject to the fulfillment at or prior to the Closing of the
following conditions:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of TASA and the Shareholders set forth in Article II hereof shall
be true and correct as of the date when made and at and as of the
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Closing, except for such changes as are permitted by this Agreement and except
to the extent a representation or warranty speaks only as of an earlier date;
PROVIDED, HOWEVER, that any inaccuracy of a representation or warranty, on the
date hereof or on the Closing Date, shall not result in the non-satisfaction of
this Section 7.02(a) unless any such inaccuracy or inaccuracies, either (i)
individually or in the aggregate, constitute facts or circumstances having a
Material Adverse Effect on TASA or (ii) are willful and intentional
misrepresentations that constitute common law fraud.
(b) COVENANTS AND AGREEMENTS. Each of TASA and the Shareholders
shall have duly performed and complied with the covenants and agreements
required by this Agreement to be performed by or complied with by it prior to or
at the Closing. None of the events or conditions entitling TMP to terminate
this Agreement under Article VIII hereof shall have occurred and be continuing.
(c) CONSENTS. Any consent required for the consummation of the
Acquisition under any material TASA Contract or TASA License or for the
continued enjoyment by TASA and the TASA Subsidiaries of the benefits of any
such contract or license after the Acquisition, shall have been obtained.
(d) OPINIONS OF COUNSEL. TMP shall have received the opinion, in
form and content satisfactory to TMP, of (i) Xxxxxxxxx Holenstein, Swiss counsel
to TASA, concerning matters included in Sections 2.01, 2.02, 2.03, 2.04, 2.05,
2.06 and 2.13 with respect to matters concerning TASA and the Shareholders; (ii)
Xxxx Patentwaelte, Xxxxxxxxxx. 0, X.X. Xxx 0000 Xxxxxx, Xxxxxxxxxxx, patent
counsel to TASA, concerning matters included in Section 2.23; and (iii) Xxxxxx,
Xxxxxx, Herlands, Randolph, Xxxxxxxxx & Cox, LLP, concerning matters included in
Sections 2.01, 2.02, 2.03, 2.04, 2.05, 2.06, 2.09, 2.12, 2.13, 2.16, 2.22, 2.23
and 2.26 with respect to TASA, Inc. With respect to matters not under Swiss
law, such firms may rely on qualified local counsel, provided that such counsel
has been approved by TMP in advance.
(e) CERTIFICATES OF TASA. TMP shall have received certificates of
TASA, satisfactory in form and substance to TMP with respect to matters in this
Section 7.02.
(f) NO ADVERSE DECISION. There shall not be any action taken or
threatened, or any statute, rule, regulation or order enacted, entered,
threatened, or deemed applicable to the transactions contemplated hereby, by any
foreign or United States Federal or state government or Governmental Entity or
Regulatory
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Authority or court that, whether in connection with the grant of a Requisite
Regulatory Approval, any agreement proposed by any foreign or United States
Federal or state government or Governmental Entity or Regulatory Authority, or
otherwise, which (i) requires or could reasonably be expected to require any
divestiture by TASA of a portion of its business that TMP in its reasonable
judgment believe will have a Material Adverse Effect on TASA or (ii) imposes any
condition upon TASA that in TMP's reasonable judgment (x) would be materially
burdensome to TASA or (y) would materially increase the costs incurred or that
will be incurred by TMP as a result of consummating the Acquisition and the
other transactions contemplated hereby. There shall be no action, suit,
investigation or proceeding pending or threatened by or before any Governmental
Entity which (i) seeks to restrain, enjoin, prevent the consummation of or
otherwise materially affect the transactions contemplated by this Agreement or
(ii) questions the validity or legality of any such transactions or seeks to
recover damages or to obtain other relief in connection with any such
transactions.
(g) PROCEEDINGS; RECEIPT OF DOCUMENTS. All corporate and other
proceedings taken or required to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be reasonably
satisfactory in form and substance to TMP and its counsel, and TMP and its
counsel shall have received all such information and such counterpart originals
or certified or other copies of such documents as TMP or its counsel may
reasonably request. TMP shall have received such other instruments, approvals
and other documents as it may reasonably request to make effective the
transactions contemplated hereby.
(h) ADVERSE CHANGE. From June 30, 1998 to the Closing, TASA shall
not have suffered any Material Adverse Change (whether or not such change is
described in any supplement to the TASA Disclosure Schedule).
(i) LETTERS FROM ACCOUNTANTS. TASA shall have delivered to TMP a
letter from Xxxxxx Xxxxxxxx LLP, dated the Closing Date, to the effect that,
subject to customary qualifications and without taking into consideration the
transactions contemplated by this Agreement and the exhibits hereto, TASA
qualifies to enter into a pooling of interests transaction for United States
financial reporting purposes.
(j) TAX MATTERS. TMP shall have received statements in accordance
with Treasury regulation Sections 1.897-2(h) and 1.1445-2(c).
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(k) NON-COMPETE/NON-SOLICITATION AGREEMENTS. Each of the
Shareholders shall have entered into a non-compete/non-solicitation agreement
with TMP, in substantially the form of EXHIBIT 7.02(K).
(l) ESCROW AGREEMENT. Each of the Shareholders shall have entered
into the Escrow Agreement.
SECTION 7.03. CONDITIONS TO THE OBLIGATIONS OF TASA AND THE SHAREHOLDERS
TO EFFECT THE ACQUISITION. The obligations of TASA and the Shareholders under
this Agreement to effect the Acquisition are subject to the fulfillment at or
prior to the Closing of the following conditions:
(a) ACCURACY OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of TMP set forth in Article III hereof shall be true and correct
as of the date when made and at and as of the Closing (except to the extent a
representation or warranty speaks only as of an earlier date and except for
changes contemplated by this Agreement); PROVIDED, HOWEVER, that any inaccuracy
of a representation or warranty, on the date hereof or on the Closing Date,
shall not result in the non-satisfaction of this Section 7.03(a) unless any such
inaccuracy or inaccuracies, either (i) individually or in the aggregate,
represent a Material Adverse Effect on TMP or (ii) are willful and intentional
misrepresentations that constitute common law fraud.
(b) COVENANTS. TMP shall have complied with the covenants and
agreements required by this Agreement to be performed or complied with by it
prior to or at the Closing in all material respects. None of the events or
conditions entitling TASA and the Shareholders to terminate this Agreement under
Article VIII hereof shall have occurred and be continuing.
(c) CERTIFICATE OF TMP. TASA shall have received a certificate of
TMP with respect to the matters covered in this Section 7.03.
(d) OPINION OF COUNSEL. TASA and the Shareholders shall have
received the opinion of Fulbright & Xxxxxxxx L.L.P., counsel to TMP, in form and
content satisfactory to TASA and the Shareholders, covering matters included in
Sections 3.01, 3.02, 3.03, 3.04 and 3.05.
(e) ADVERSE CHANGE. From June 30, 1998 to the Closing, TMP shall not
have suffered any Material Adverse Change (whether or not such change is
described in any supplement to the TMP Disclosure Schedule).
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(f) NON-COMPETE/NON-SOLICITATION AGREEMENTS. TMP shall have entered
into a non-compete/non-solicitation agreement with each Shareholder.
(g) ESCROW AGREEMENT. TMP shall have entered into the Escrow
Agreement.
(h) REORGANIZATION REPRESENTATIONS. TMP shall have delivered to TASA
a certificate substantially in the form of EXHIBIT 7.03(H) hereto.
ARTICLE VIII
TERMINATION, AMENDMENTS AND WAIVERS
SECTION 8.01. TERMINATION. This Agreement may be terminated at any time
prior to the Closing:
(a) by the mutual consent of the Board of Directors of TMP and the
unanimous consent of the Shareholders;
(b) by TMP and the unanimous consent of the Shareholders if the
Closing shall not have occurred on or before the close of business on October
31, 1998, provided that the terminating party is not in Default;
(c) by TMP, if it is not in material breach of its obligations under
this Agreement, and if (A) there has been a breach by TASA or the Shareholders
of any of their respective representations and warranties hereunder such that
Section 7.02(a) will not be satisfied or (B) there has been the willful breach
on the part of TASA or the Shareholders of any of their respective covenants or
agreements contained in this Agreement such that the first sentence of Section
7.02(b) will not be satisfied, and, in both case (A) and case (B), such breach
has not been cured within ten (10) days after notice to TASA;
(d) by the unanimous consent of the Shareholders, if none of them are
in material breach of their respective obligations under this Agreement, and if
(A) there has been a breach by TMP of any of its representations and warranties
hereunder such that Section 7.03(a) will not be satisfied or (B) there has been
the willful breach on the part of TMP of any of its covenants or agreements
contained in this Agreement such that the first sentence of Section 7.03(b) will
not be satisfied, and, in both case (A) and (B), such breach has not been cured
within ten (10) days after notice to TMP;
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(e) by TMP, if, prior to the Closing TASA or the Shareholders holding
a majority of the shares of TASA have entered into a letter of intent,
commitment letter or other written agreement with a third party regarding a
takeover proposal (as defined in Section 4.03) or has otherwise breached the
provisions of Section 4.03 hereof;
(f) by TMP, if, after the date of this Agreement, there shall have
occurred a Material Adverse Change in TASA;
(g) by the unanimous consent of the Shareholders, if, after the date
of this Agreement, there shall have occurred a Material Adverse Change in TMP.
SECTION 8.02. EFFECT OF TERMINATION. In the event of termination of this
Agreement by TASA or TMP as provided in Section 8.01 hereof, this Agreement
shall, except as provided herein, forthwith become void and there shall not be
any liability or obligation with respect to the terminated provisions of this
Agreement on the part of TASA or TMP or their respective officers or directors,
except and to the extent such termination results from the willful breach by a
party of any of its representations, warranties or agreements hereunder.
Notwithstanding the foregoing, (i) if TMP shall become entitled to terminate,
and shall terminate, this Agreement pursuant to Section 8.01(e), then TASA and
the Shareholders shall promptly, but in no event later than one business day
after the occurrence of the event described in Section 8.01(e), pay to TMP a fee
of $5,000,000, such amount to be paid in cash in immediately available funds by
wire transfer to an account designated by TMP, or (ii) if a party hereto
terminates this Agreement pursuant to Section 8.01(c) or (d) because of the
willful breach by the other party of its covenants and agreements set forth
herein, as the case may be, the party terminating the Agreement in the case of a
termination pursuant to Section 8.01(c) or (d) shall be entitled to
reimbursement for all its out-of-pocket expenses incurred in connection with
this Agreement and the Acquisition from the other party.
SECTION 8.03. AMENDMENT. This Agreement may be amended by the parties
hereto, by action taken by their respective Boards of Directors, at any time
prior to Closing. This Agreement may not be amended except by an instrument in
writing signed on behalf of each of the parties hereto.
SECTION 8.04. WAIVER. At any time prior to the Closing, the parties
hereto, by action taken by their respective Boards of Directors or Executive
Committees, may (i) extend the time for the performance of any of the
obligations or other acts of the other party hereto, (ii) waive any inaccuracies
in the representations and warranties of the other party hereto contained herein
or in any document delivered
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pursuant hereto and (iii) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed on behalf of such party.
ARTICLE IX
INDEMNIFICATION
SECTION 9.01. INDEMNIFICATION BY THE SHAREHOLDERS. (a) Subject to
Section 9.04, the Shareholders shall, jointly and severally, indemnify TMP and
hold TMP harmless after the Closing from and against and in respect of any
losses, damages, expenses, liabilities, claims, settlements, assessments and
judgments (including reasonable costs and attorneys' fees and other expenses
arising out of any claim, or the defense, settlement or investigation thereof,
made with respect to any of the foregoing, including, without limitation, those
arising in any action against any Shareholder) incurred or suffered by TMP,
arising out of, based upon or resulting from (i) any breach by TASA or the
Shareholders of their respective representations and warranties, obligations or
covenants contained in this Agreement or any document or certificate delivered
by them pursuant to this Agreement, (ii) any Taxes for all periods through the
Closing Date (whether or not disclosed on the TASA Disclosure Schedule) which
Taxes have not been reserved for on the June 30, 1998 balance sheet included in
the Interim Financial Statements, or (iii) the failure of TASA or the TASA
Subsidiaries to obtain any consent required in connection with the consummation
of the transactions contemplated hereby.
(b) Each Shareholder shall, severally and not jointly, indemnify TMP and
hold TMP harmless from and against and in respect of any losses, damages,
expenses, liabilities, claims, settlements, assessments and judgments (including
reasonable costs and attorneys' fees and other expenses arising out of any
claim, or the defense, settlement or investigation thereof, made with respect to
any of the foregoing, including, without limitation, those arising in any action
against such Shareholder) incurred or suffered by TMP, arising out of, based
upon or with respect to untrue statements or omission, made in the Registration
Statement (or any amendment thereto) in reliance upon and in conformity with
written information furnished to TMP by such Shareholder expressly for use in
the Registration Statement (or any amendment or supplement thereto).
SECTION 9.02. INDEMNIFICATION BY TMP. Subject to Section 9.04
(Limitations), TMP shall indemnify and hold harmless the Shareholders at all
times
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after the Closing from and against and in respect of any losses, damages,
expenses, liabilities, claims, settlements, assessments and judgments (including
reasonable costs and attorneys' fees and other expenses arising out of any
claim, or the defense, settlement or investigation thereof, made with respect to
any of the foregoing) incurred or suffered by the Shareholders, arising out of,
based upon or resulting from (i) any breach by TMP of its representations and
warranties, obligations or covenants contained in this Agreement or any document
or certificate delivered by TMP pursuant to this Agreement, or (ii) arising out
of any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment thereto), covering the Stock
Consideration, including all documents incorporated therein by reference, or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising
out of any untrue statement or alleged untrue statement of a material fact
contained in any prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
SECTION 9.03. BROKERAGE FEES. Subject to Section 9.04, each of TASA and
TMP shall indemnify and hold harmless the other party from and against the
payment of any and all broker's and finder's expenses, commissions, fees or
other forms of compensation which may be due or payable from or by the
indemnifying party, or may have been earned by any third party acting on behalf
of the indemnifying party in connection with the negotiation and execution
hereof and the consummation of the transactions contemplated hereby.
SECTION 9.04. LIMITATIONS. (a) No party hereto shall be entitled to make
any claim for indemnification under this Article IX with respect to the breach
of any representation and warranty contained in this Agreement after the date on
which such representation and warranty ceases to survive pursuant to Section
9.07.
(b) Notwithstanding anything to the contrary contained herein, no
Indemnified Party shall be entitled to indemnification from an Indemnifying
Party until the aggregate losses suffered by such Indemnified Party and for
which indemnification is available hereunder exceed $100,000, whereupon the
Indemnified Party shall be entitled to claim indemnification for all losses
suffered by such Indemnified Party and for which indemnification is available
hereunder; provided, however, that this $100,000 threshold shall not be
applicable with respect to indemnification under clauses (ii) or (iii) of
Section 9.01 hereof.
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(c) Except as set forth in the last sentence hereof, a Shareholder's
liability hereunder and under the Registration Statement shall be limited to the
value of the Stock Consideration received by such Shareholder on the Closing
Date whether or not the value of the Stock Consideration changes subsequent to
the Closing Date and whether or not the Shareholder disposes of all or a part of
such Stock Consideration. No limitation provided in this Section 9.04, however,
shall be applicable with respect to any claim for fraud committed by such
Shareholder.
SECTION 9.05 NOTICE AND DEFENSE OF CLAIMS. Each party entitled to
indemnification under this Article IX (the "INDEMNIFIED PARTY") shall give
notice to the party required to provide indemnification (the "INDEMNIFYING
PARTY") promptly after such Indemnified Party has actual knowledge of any claim
as to which indemnity may be sought, and, in the event of any claim or demand
asserted by a third party, shall permit the Indemnifying Party to assume the
defense of any such claim or any litigation resulting therefrom, provided that
counsel for the Indemnifying Party, who shall conduct the defense of such claim
or any litigation resulting therefrom, shall be approved by the Indemnified
Party (whose approval shall not unreasonably be withheld), and the Indemnified
Party may participate in such defense at such party's expense, and provided
further that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its obligations under this
Agreement unless such failure to give notice materially adversely affected the
ability of the Indemnifying Party to defend such claim or to the extent the
Indemnifying Party was actually damaged thereby. The Indemnifying Party, in the
defense of any such claim or litigation, shall not, except with the consent of
the Indemnified Party, consent to entry of any judgment or entry into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to the Indemnified Party of a release from all
liability in respect to such claim or litigation. The Indemnified Party shall
not settle or compromise any such claim without the prior written consent of the
Indemnifying Party, which consent shall not be unreasonably withheld. The
Indemnified Party shall furnish such information regarding itself or the claim
in question as the Indemnifying Party may reasonably request in writing and as
shall be reasonably required in connection with defense of such claim and
litigation resulting therefrom.
SECTION 9.06. NON-EXCLUSIVE REMEDY. Indemnification pursuant to this
Agreement shall not preclude TMP or the Shareholders from exercising any other
remedies it may have, subject to the limitations set forth in Section 9.04
hereof.
SECTION 9.07. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained in this Agreement shall survive the
Closing and shall remain in full force and effect for the applicable period of
time
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set forth in this Section 9.07. Any representations, warranties or portion
thereof the breach or misrepresentation with respect to which would be expected
to be encountered or discerned in TMP's audit of the combined financial
statement of TMP and TASA for the fiscal year ending December 31, 1998, shall
survive until the date TMP's independent certified public accountants issue
their final report and opinion on such audit. Any other representations and
warranties shall survive for a period of one year after the Closing.
SECTION 9.08 REIMBURSEMENT. Subject to Section 9.04 hereof, at the time
that the Indemnified Party shall suffer a loss because of a breach of any
warranty, representation or covenant by the Indemnifying Party or at the time
the amount of any liability on the part of the Indemnifying Party under this
Agreement is determined (which in the case of payment to third persons shall be
the earlier of (i) the date of such payment, provided that the Indemnified Party
has fully complied with Section 9.05, or (ii) the date that a court of competent
jurisdiction shall enter a final judgment, order or decree (after exhaustion or
expiration of appeal rights) establishing such liability) (such loss or amount
being hereinafter referred to as the "INDEMNITY CLAIM")), the Indemnifying Party
shall forthwith, upon notice from the Indemnified Party, pay to the Indemnified
Party the amount of the Indemnity Claim; provided, however, that TMP shall pay
any such amounts owed by it in TMP Common Stock, based upon the dollar amount
indemnity of such Claim divided by the higher of (i) the average of the closing
sale price per share as reported by the Nasdaq National Market for the 30-day
period ending two days prior to the date any such Indemnity Claim is paid, and
(ii) $28.00. If such amount is not paid forthwith, then the Indemnified Party
may, at its option, take legal action against the Indemnifying Party for
reimbursement in the amount of its Indemnity Claim. For purposes hereof the
Indemnity Claim shall include the amounts so paid, or determined to be owing, by
the Indemnified Party together with costs and reasonable attorney's fees and
interest on the foregoing items (but only to the extent pre-judgment interest
due the Indemnified Party is not already included within such items) at the rate
of ten percent (10%) per annum from the date the Indemnity Claim is due from the
Indemnifying Party to the Indemnified Party as hereinabove provided, until the
Indemnity Claim shall be paid.
SECTION 9.09. OFFSET. Any claim of TMP arising pursuant to this
Article IX or any other provision of this Agreement shall be offset against the
value of the Escrowed Shares on a pro rata basis in proportion to the percentage
such Shareholder's portion of the Stock Consideration bears to the total Stock
Consideration, before any other claim is made on the Shareholders.
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SECTION 9.10. ARBITRATION. In order to insure that the transactions
contemplated hereby qualify for treatment as a pooling-of-interests for
financial reporting purposes, the parties agree that any dispute, disagreement
or controversy between any Indemnified Party and the Indemnifying Party with
respect to any claim for indemnification pursuant to this Agreement that is not
resolved within the applicable time period specified in Section 9.07 of this
Agreement (the "Indemnification Termination Date") shall promptly be submitted
to the American Arbitration Association (the "AAA") to be resolved by binding
arbitration in accordance with the arbitration rules of the AAA. The place of
arbitration shall be New York, New York. The arbitration tribunal shall be
composed of three arbitrators, one of which shall be appointed by TMP within 10
business days of the Indemnification Termination Date, one of which shall be
appointed by the Shareholders within 10 business days of the Indemnification
Termination Date and one of which shall be appointed by the arbitrators
appointed by TMP and the Shareholders within 15 business days of the
Indemnification Termination Date. The arbitrators will be directed to resolve
such dispute, disagreement or controversy as soon as practicable (and, in any
event, by the earlier of (i) two months of the date the claims for
indemnification is made and (ii) the Indemnification Termination Date).
ARTICLE X
DEFINITIONS
As used in this Agreement, the following terms shall have the meanings set
forth below:
"Accredited Investor" shall mean (i) an individual whose net worth or joint
net worth with such person's spouse exceeds $1,000,000 or (ii) an individual
whose income exceeded $200,000 in 1996 and 1997, or whose income with his or her
spouse exceeded $300,000 in such years, and who reasonably expects to reach such
levels in 1998.
"Acquisition" shall have the meaning given such term in the Recitals
hereto.
"Affiliate" or "affiliate" shall mean, with respect to any Person, any
other Person that, directly or indirectly, controls or is controlled by or is
under common control with such Person. As used in this definition of
"Affiliate", the term "control" and any derivatives thereof mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting
securities, by contract, or otherwise.
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"Affiliated Group" shall mean any affiliated group within the meaning of
Section 1504 of the Code or any similar group defined under a similar provision
of state, local or foreign law, including, but not limited to, any combined,
consolidated or unitary group.
"Agreement" shall mean this Purchase Agreement.
"Audited Financial Statements" shall have the meaning given such term in
Section 2.07 hereof.
"Balance Sheet Date" shall mean December 31, 1997.
"Business Combination" shall mean (i) any merger or consolidation of TASA
or any TASA Subsidiary representing more than ten percent of TASA's consolidated
assets or revenues with or into any Person (other than TASA), (ii) any sale,
lease, exchange, transfer or other disposition (whether in one transaction or a
series of related transactions) of more than ten percent of TASA's consolidated
assets, (iii) the adoption of any plan or proposal for the liquidation or
dissolution of TASA or any TASA Subsidiary representing more than ten percent of
TASA's consolidated assets or revenues, (iv) any issuance, sale, purchase or
redemption of equity securities, any reclassification of equity securities or
recapitalization of TASA representing more than ten percent of TASA's
consolidated assets or revenues, and (v) any transaction having an effect
similar to those described above.
"Business Day" shall mean any day, other than a Saturday, Sunday or legal
holiday under the Federal laws of the United States.
"Closing" shall have the meaning given such term in Section 1.02 hereof.
"Closing Date" shall mean the date on which the Closing occurs.
"Closing Shares" shall have the meaning given such term in Section 1.01
hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Common Stock" shall mean collectively the Common Stock, par value
x.xx. 100 per share, of TASA.
"Confidentiality Agreement" shall mean that certain Confidentiality
Agreement, dated as of May 19, 1998 between TMP and TASA.
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"Environmental Laws" shall mean all Federal, state, local and foreign
environmental statutes and regulations relating to pollution, hazardous
substances or protection of the environment, including but not limited to the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq.; the
Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Federal Water Pollution
Control Act, 33 U.S.C. Section 1251 et seq.; the Toxic Substances Control Act,
15 U.S.C. Section 2601 et seq.; the Comprehensive Environmental Response,
Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq.; the
Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq.; related
state, local and foreign laws; and all applicable published rules, regulations,
directives, guidance and policies of the EPA and of all similar state and local
agency requirements.
"EPA" shall mean the United States Environmental Protection Agency.
"ERISA" means the Employee Retirement Income Security Act of 1974, as it
exists and is hereafter amended.
"Employee Plan" shall mean: (i) any "employee benefit plan," as such term
is defined in Section 3(3) of ERISA, whether or not subject to the provisions of
ERISA, or any other similar arrangement under the laws of any other jurisdiction
in which TASA or any TASA Subsidiary does business; (ii) any personnel policy;
and (iii) any other employment, consulting, collective bargaining, stock option,
stock bonus, stock purchase, phantom stock, incentive, bonus, deferred
compensation, retirement, severance, dependent care, employee assistance,
material fringe benefit, dental, death benefit, golden parachute or other
compensatory plan, contract, policy or arrangement which is not an employee
benefit plan as defined in Section 3(3) of ERISA, or any other similar
arrangement under the laws of any other jurisdiction in which TASA or any TASA
Subsidiary does business.
"Escrow Agreement" shall have the meaning given such term in Section 1.02
hereof.
"Escrow Release Date" shall have the meaning given such term in Section
1.02 hereof.
"Escrowed Shares" shall have the meaning given such term in Section 1.01
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder.
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"Financial Statements" shall have the meaning given such term in Section
2.07 hereof.
"Generally accepted accounting principles" shall mean generally accepted
accounting principles in Switzerland.
"Governmental Entity" shall mean any foreign or domestic court,
administrative agency or commission or other governmental authority or
instrumentality.
"Indemnification Termination Date" shall have the meaning given such term
in Section 9.10 hereof.
"Indemnified Party" shall have the meaning given such term in Section 9.05
hereof.
"Indemnifying Party" shall have the meaning given such term in Section 9.05
hereof.
"Indemnity Claim" shall have the meaning given such term in Section 9.08
hereof.
"Intellectual Property" shall have the meaning given such term in Section
2.22 hereof.
"Interim Financial Statements" shall have the meaning given such term in
Section 2.07 hereof.
"IRS" shall mean the Internal Revenue Service.
"Liens" shall mean all liens, charges, security interests, rights or claims
of others, restraints on transfer or other encumbrances.
"Material Adverse Change" shall mean a change or a development involving a
prospective change which would have a Material Adverse Effect.
"Material Adverse Effect" shall mean, with respect to any Person, a
material adverse effect on the business, prospects, results of operations,
financial condition or assets of such Person and its Subsidiaries taken as a
whole. In determining whether any individual event would result in a Material
Adverse Effect, notwithstanding that such event does not of itself have such
effect, a Material
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Adverse Effect shall be deemed to have occurred if the cumulative effect of such
event and all other then existing events would result in a Material Adverse
Effect.
"PBGC" shall mean the United States Pension Benefit Guaranty Corporation.
"Person" shall mean an individual, corporation, partnership, joint venture,
trust or unincorporated organization, or a government or any agency or political
subdivision thereof.
"Regulatory Authority" shall mean any foreign, Swiss, United States Federal
or state government or governmental authority the approval of which, or filing
with, is legally required or permitted for consummation of the transactions
contemplated by this Agreement.
"Requisite Regulatory Approvals" shall have the meaning given such term in
Section 7.01(b) hereof.
"SEC" means the United States Securitas and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
"Significant Subsidiaries" means, with respect to TASA, the following:
TASA, Inc., a Florida corporation, TASA/Consulting Partners GmbH and Inter Ad
GmbH, each a German corporation, TASA Ltd., a corporation organized under the
laws of the United Kingdom, TASA S.p.A., an Italian corporation and TASA
Executive Search Pty. Ltd., an Australian corporation.
"Stockholder Information" shall have the meaning given such term in Section
2.26(f) hereof.
"Subsidiary" means, with respect to any entity, any corporation of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are directly or indirectly owned by such entity; provided, however, that the
term "Subsidiaries", when used alone, shall mean, in the case of TASA, the TASA
Subsidiaries, and in the case of TMP, the TMP Subsidiaries.
"TASA Balance Sheet" shall mean the consolidated balance sheet of TASA at
December 31, 1997.
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"TASA Contracts" shall have the meaning given such term in Section 2.16(a)
hereof.
"TASA Disclosure Schedule" shall have the meaning given such term in the
preamble to Article II hereof.
"TASA License" shall have the meaning given such term in Section 2.23
hereof.
"Tax" or "Taxes" shall mean any and all federal, state, local, foreign and
other taxes, levies, fees, imposts, duties and charges of whatever kind
(including any interest, penalties or additions to the tax imposed in connection
therewith or with respect thereto), whether or not imposed on TASA or any TASA
Subsidiary, including, without limitation, taxes imposed on, or measured by,
income, franchise, profits, or gross receipts, and also ad valorem, value added,
sales, use, service, real or personal property, capital stock, license, payroll,
withholding, employment, social security, workers' compensation, unemployment
compensation, utility, severance, production, excise, stamp, occupation,
premium, windfall profits, transfer, and gains taxes, and custom duties.
"Tax Return" shall mean returns, reports, information statements, and other
documentation (including any additional or supporting material) filed or
maintained, or required to be filed or maintained, in connection with the
calculation, determination, assessment or collection of any Tax.
"TMP Disclosure Schedule" shall have the meaning given such term in the
preamble to Article III hereof.
"TMP Exchange Act Filings" shall have the meaning given such term in
Section 3.06 hereof.
"U.S. Person" means:
(i) any natural person resident in the United States;
(ii) any partnership or corporation organized or incorporated under
the laws of the United States;
(iii) any estate of which any executor or administrator is a U.S.
Person;
(iv) any trust of which any trustee is a U.S. Person;
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(v) any agency or branch of a foreign entity located in the United
States;
(vi) any non-discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the
benefit or account of a U.S. Person;
(vii) any discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary
organized, incorporated, or (if an individual) resident in
the United States; and
(viii) any partnership or corporation if:
(a) organized or incorporated under the laws of any foreign
jurisdiction; and
(b) formed by a U.S. Person principally for the purpose of
investing in securities not registered under the Securities
Act, unless it is organized or incorporated, and owned, by
accredited investors (as defined in Rule 501(a) under the
Securities Act) who are not natural persons, estates or
trusts.
"United States" means the United States of America, its territories and
possessions and any state of the United States (including for the purposes
hereof the District of Columbia).
ARTICLE XI
GENERAL PROVISIONS
SECTION 11.01. TAKING OF NECESSARY ACTION; SPECIFIC PERFORMANCE.
Subject to the terms and conditions of this Agreement, each of the parties
hereto agrees, subject to applicable laws, to use all reasonable efforts
promptly to take or cause to be taken all action and promptly to do or cause to
be done all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement. Without limiting the foregoing, the parties hereto shall use
their best efforts to obtain and make all consents, approvals, assurances and
filings of or with third parties and
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Governmental Entities necessary or, in their reasonable opinion, advisable for
the consummation of the transactions contemplated by this Agreement. Each party
shall cooperate with the other in good faith to help the other satisfy its
obligations hereunder and thereunder. The parties hereto understand and agree
that the covenants and undertakings on each of their parts herein contained are
uniquely related to the desire of the parties hereto to consummate the
Acquisition, that the Acquisition is a unique business opportunity and that,
although monetary damages may be available for the breach of such covenants and
undertakings, monetary damages would be an inadequate remedy therefor.
Accordingly, the parties hereto agree that TMP shall be entitled to obtain
specific performance by TASA and the Shareholders of every such covenant and
undertaking contained herein to be performed by them.
SECTION 11.02. EFFECT OF DUE DILIGENCE. No investigation by or on
behalf of one party into the business, operations, prospects, assets or
condition (financial or otherwise) of another party shall diminish in any way
the effect of any representations or warranties made by such party.
SECTION 11.03. EXPENSES. Except as provided in Section 8.02 hereof,
all costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring the same;
provided that the Shareholders shall be responsible for the legal, accounting
and other fees incurred jointly by the Shareholders and TASA.
SECTION 11.04. SUCCESSORS AND ASSIGNS. This Agreement will inure to
the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties hereto.
SECTION 11.05. ENTIRE AGREEMENT. This Agreement and the other
documents referred to herein contain the entire agreement among the parties
hereto with respect to the transactions contemplated hereby, and controls and
supersedes any prior understandings, agreements or representations by or between
the parties, written or oral, which conflicts with, or may have related to, the
subject matter hereof or thereof in any way, including without limitation that
certain letter dated June 2, 1998, from TMP to TASA.
SECTION 11.06. NOTICES. All notices or other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered
personally or sent by telex, telefax or telegraphic communication, by recognized
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overnight courier marked for overnight delivery, or by registered or certified
mail, postage prepaid, addressed as follows:
(a) If to TASA or a Shareholder x/x XXXX Xxxxxxxxxxxxx XX,
Xxxxxxxxxxxxx 000, XX-0000, Xxxxxx, Xxxxxxxxxxx, Attention: President (or, in
the case of a Shareholder, such Shareholder) , with a copy to: Xxxxxx, Xxxxxx,
Herlands, Randolph, Xxxxxxxxx & Cox LLP, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxxx X. Xxxxxx and Xxxxx Xxxxxx; and Xxxxxxxxx
Xxxxxxxxxx, Utoquai 29/31 XX-0000, Xxxxxx, Xxxxxxxxxxx, Attention: Xx. Xxxxx
Xxxxxxxxx; and
(b) If to TMP, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Chairman, with copies to: Xxxxx Xxxxxxxxxx, Esq., TMP Worldwide Inc., 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Fulbright & Xxxxxxxx L.L.P., 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxxx, Esq.; and Xxxxxxxx
Rechtsanwalte, Xxxxxxxxxxxxxx 00, XX-0000, Xxxxxx, Xxxxxxxxxxx, Attention: Xx.
Xxxxxx X. Xxxxxxxx;
or such other addresses as shall be furnished by like notice by such party. All
such notices and communications shall, when telexed (provided the correct
answerback has been received) or telefaxed (immediately thereafter confirmed by
telephone) or telegraphed, be effective when telexed, telefaxed or delivered to
the telegraph company, respectively, or if sent by nationally recognized
overnight courier service, be effective one Business Day after the same has been
delivered to such courier service marked for overnight delivery, or, if mailed,
be effective when received.
SECTION 11.07. APPLICABLE LAW. Except for Section 2.03, which shall
be governed by Swiss law, this Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York, without reference
to or application of any conflicts of laws principles.
SECTION 11.08. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
SECTION 11.09. HEADINGS. The headings used in this Agreement are for
convenience only and are not to be considered in construing or interpreting any
term or provision of this Agreement.
-58-
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto as of the date
first written above.
TMP WORLDWIDE INC.
By: /s/ Xxxxx Xxxxxxxxxx
--------------------------------
TASA HOLDING AG
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
SHAREHOLDERS:
/s/ Pierre Aussure
-----------------------------------
Pierre Aussure
/s/ Xxxxxxx Xxxxxxx
-----------------------------------
Xx. Xxxxxxx Xxxxxxx
/s/ Xxxxx X. Xxxx
-----------------------------------
Xxxxx X. Xxxx, Individually on his own behalf and
as a Trustee of a pension trust
/s/ Xxxxxxx X. Xxxxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxxxxx
/s/ Xxxx X. Xxxxxx
-----------------------------------
Xxxx X. Xxxxxx
-59-
/s/ Xxxxxx X. Xxxxx
-----------------------------------
Xxxxxx X. Xxxxx, Individually on his own behalf
and as Trustee of a pension trust
/s/ Jo Xxxxx Xxxxxxx
-----------------------------------
Jo Xxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx
/s/ Xxxxx X. X. Dammrof
-----------------------------------
Xx. Xxxxx X. X. Dammrof
/s/ Xxxxxx X. Xxxx
-----------------------------------
Xxxxxx X. Xxxx
/s/ Fiona X. X. Xxxxx
-----------------------------------
Fiona X. X. Xxxxx, Individually on her own behalf
and as Trustee of a pension trust
/s/ Xxxxxx DeKessel
-----------------------------------
Xxxxxx DeKessel
/s/ Xxxxx X. Xxxxxxx
-----------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxx
-----------------------------------
Xxxxxx X. Xxxx
/s/ Xxxx Xxxxxxxx Ygartua
-----------------------------------
Xxxx Xxxxxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxx Malagelada
-----------------------------------
Xxxxxxx Xxxxxx Malagelada
-60-
/s/ Xxxx Xxxxxx Xxxxxx Xxxxxxxxxx
-----------------------------------
Xxxx Xxxxxx Xxxxxx Xxxxxxxxxx
/s/ Xxxxxxx X. X. Xxxxxx
-----------------------------------
Xxxxxxx X. X. Xxxxxx, Individually on his own
behalf and as Trustee of a pension trust
/s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx
/s/ Xxxxxxx Xxxxxxxx
-----------------------------------
Xxxxxxx Xxxxxxxx
/s/ Xxxx Xxxxx
-----------------------------------
Xxxx Xxxxx
/s/ Xxxxx X. Xxxx
-----------------------------------
Xxxxx X. Xxxx
/s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
/s/ Christian X. X. Xxxx
-----------------------------------
Christian X. X. Xxxx
/s/ Xxxx X. Xxxxxxxx
-----------------------------------
Xxxx X. Xxxxxxxx, Individually on his own behalf
and as Trustee of a pension trust
/s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxxx, Individually on his own
behalf and as Trustee of a pension trust
-61-
/s/ Xxxxx Xxxxxx
-----------------------------------
Xxxxx Xxxxxx
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxx X. Xxxxxx-Xxxxxxx
-----------------------------------
Xxx X. Xxxxxx-Xxxxxxx
/s/ Xxxxxx XxXxxxxxx
-----------------------------------
Xxxxxx XxXxxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxx X. X. Xxxxx
-----------------------------------
Xxxxx X. X. Xxxxx
/s/ Xxxxx Magnet
-----------------------------------
Xxxxx Magnet
/s/ Xxxxxxxx Xxxxx
-----------------------------------
Xxxxxxxx Xxxxx
/s/ Xxxxxx X. XxXxxxxx
-----------------------------------
Xxxxxx X. XxXxxxxx
/s/ Xxxx XxXxxxxxxx
-----------------------------------
Xxxx XxXxxxxxxx
/s/ Massimo Misticoni
-----------------------------------
Massimo Misticoni
-62-
/s/ Xxxxx Xxxxx Xxxxxxx Xxxxxxx
-----------------------------------
Xxxxx Xxxxx Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx, Individually on his own behalf
and as Trustee of a pension trust
/s/ X. Xxxxx Rijke
-----------------------------------
X. Xxxxx Rijke
/s/ Xxxxxxx Xxxxxxxxxx
-----------------------------------
Xxxxxxx Xxxxxxxxxx
/s/ Xxxxxx X. X. Xxxxxxx
-----------------------------------
Xxxxxx X. X. Xxxxxxx, Individually and as Trustee
/s/ Xxxxxxx X. X. Xxxxxxx
-----------------------------------
Xxxxxxx X. X. Xxxxxxx
/s/ Xxxx X. Xxxxxxxxxx
-----------------------------------
Xxxx X. Xxxxxxxxxx
/s/ Xxxx Xxxx
-----------------------------------
Xxxx Xxxx
/s/ Xxxx X. Van Es
-----------------------------------
Xxxx X. Van Es, Individually on his own behalf and
as Trustee of a pension trust
/s/ Xxxxxxxxxx Xxxx Vilar
-----------------------------------
Xxxxxxxxxx Xxxx Xxxxx
-63-
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxxxxx Xxxxxx-Xxxxx
-----------------------------------
Xx. Xxxxxxxx Xxxxxx-Xxxxx
/s/ Xxxxxx X. Wine
-----------------------------------
Xxxxxx X. Wine
/s/ Xxxxxxx X. Xxxx
-----------------------------------
Xxxxxxx X. Xxxx
/s/ Xxxxx X. Xxxx
-----------------------------------
Xxxxx X. Xxxx
-64-
Exhibit 1.03(b)
DECLARATION OF ASSIGNMENT
-------------------------
With effect as of Closing under the Agreement to be dated and entered into
as of August 31, 1998, by and among TMP Worldwide Inc., TASA Holding AG, myself
and the other Shareholders, as set out on Schedule A to the Agreement and under
the confition precedent that the Closing under the Agreement will take place by
September 30, 1998, I ___________________________________, with an address at
(Print Name)
______________________________________________________________________________
(Print Address and Domicile)
hereby assign _______________ registered shares, Nos. ___________________ of
TASA
(No. of shares) (Share Certificates)
Holding AG, Zug, Switzerland, with a par value of CHF 100.00, together with all
preferential and ancillary rights, to TMP Worldwide Inc., a Delaware
corporation, in accordance with Section 1.03(c) of the Agreement and Article 165
of the Swiss Code of Obligations.
This Assignment shall be governed by, and construed and interpreted in
accordance with, the substantive laws of Switzerland.
-65-
----------------------------------------
(Place of Execution)
Date: August ____, 1998 -------------------------------
(Signature)
-------------------------------
(Print Name)
-66-
Exhibit 2.28(l)
CERTIFICATE AS TO INVESTOR STATUS
---------------------------------
Pursuant Section 2.28(l) of the Agreement, dated as of August 31, 1998 by
and among TMP Worldwide Inc., TASA Holding AG and the Shareholders of TASA
Holding AG named therein (the "Agreement"), the undersigned hereby certifies
that it is either:
(PLEASE CHECK ONE)
/ / an Accredited Investor, or a non-U.S. person;
OR
/ / a U.S. person and not an Accredited Investor.
Capitalized terms used in this certificate are defined in the Agreement.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of the
31st day of August, 1998.
By:
--------------------------------
Name:
------------------------------
(Please Print)
EXHIBIT 7.03(h)
TMP WORLDWIDE INC.
OFFICER'S CERTIFICATE
Pursuant to section 7.03(h) of the Agreement, dated as of August 31,
1998, by and among TMP Worldwide Inc. ("TMP"), TASA Holding AG ("TASA") and the
shareholders of TASA named therein (the "Shareholders") (the "Agreement"), it is
a condition to the obligations of TASA and the Shareholders under the Agreement
that TMP deliver this certificate to TASA. In connection therewith, the
undersigned officer of TMP hereby certifies on behalf of TMP to the best of his
knowledge and belief:
1. TMP has no current plan or intention to:
(1) liquidate TASA;
(2) merge TASA into another entity;
(3) cause TASA to sell or otherwise dispose of any of its assets,
except for dispositions made in the ordinary course of its business; or
(4) sell or otherwise dispose of any of the TASA stock acquired by
TMP pursuant to the Agreement, except for transfers described in Section
368(a)(2)(C) of the Internal Revenue Code of 1986, as amended (the "Code") or
permitted under Section 1.368-1(d) of the Income Tax Regulations.
2. TMP has no current plan or intention to cause TASA to issue additional
shares that would result in TMP losing control of TASA within the meaning of
Section 368(c) of the Code.
3. TMP has no current plan or intention to reacquire any of the TMP
Common Stock (as defined in the Agreement) issued to the Shareholders pursuant
to the Agreement. To the best of the knowledge of the undersigned, no person
related to TMP (within the meaning of Section 1.368-1(e)(3) of the Income Tax
Regulations) and no person acting as an intermediary for or on behalf of TMP or
such a related person has a plan or intention to acquire any of the TMP Common
Stock issued pursuant to the Agreement.
4. Following the acquisition of the TASA common stock, TMP (including the
members of TMP's qualified group (as defined in section 1.368-1(d)(4)(ii) of the
Income Tax Regulations) in the aggregate will continue the historic business of
TASA or use a significant portion of TASA's historic business assets in a
business.
5. TMP does not own, directly or indirectly, nor has it owned during the
last five years, directly or indirectly, any stock of TASA.
6. TMP will acquire the TASA shares solely for voting stock of TMP.
7. TMP is not an investment company within the meaning of Section
368(a)(2)(F) of the Code.
8. The rate of the exchange of shares of TASA common stock for TMP Common
Stock has been negotiated through arm's length bargaining. Following the
Closing, the compensation paid to the Shareholders will be for services actually
rendered and not allocable to their shares of TASA common stock.
9. There is no intercorporate indebtedness existing between TMP and TASA.
To the best of the knowledge of the undersigned, there exists no indebtedness
between TASA and any person related to TMP (within the meaning of Section
1.368-1(e)(3) of the Income Tax Regulations).
10. The payment of cash in lieu of fractional shares of stock of TASA is
not separately bargained for consideration and is being made by TMP for the sole
purpose of saving TMP the expense and inconvenience of issuing fractional
shares.
IN WITNESS WHEREOF, I have, on behalf of TMP, signed this Certificate
as of August __, 1998.
TMP WORLDWIDE INC.
By:
---------------------------
Name:
Title:
