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EXHIBIT 2.9
FINAL
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SHARE PURCHASE AGREEMENT
By and Among
SPSS INC.
and
SURVEYCRAFT PTY LTD.
and
XXXX XXXXXXXX
and
MICROTAB SYSTEMS PTY LTD.
Dated as of November 1, 1998
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SHARE PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT, dated as of November 1, 1998, (the
"Agreement"), by and among SPSS INC., a Delaware corporation, having an address
at 000 Xxxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Xxxxxx Xxxxxx of America
("SPSS"), SURVEYCRAFT PTY LTD., a corporation organized under the laws of
Australia, having an address at 00 Xxxx Xxxxxx, Xxxxxxxxxxx Xxxxxxxx 0000,
Xxxxxxxxx ("Surveycraft"), XXXX XXXXXXXX, an individual, having an address at
Xxxx 0/00 Xxxxxxxx Xxxx, Xxxxx Xxxxx, Xxxxxxxx 0000, Xxxxxxxxx ("Xxxxxxxx") and
MICROTAB SYSTEMS PTY LTD, ACN 062 169 117, as trustee for the MICROTAB UNIT
TRUST, having an address at 0 Xxxxx Xxx, Xxxxxx, Xxxxxxxx 0000, Xxxxxxxxx
("Microtab") (Xxxxxxxx and Microtab are hereinafter collectively referred to as
the "Shareholders").
W I T N E S S E T H:
WHEREAS, Surveycraft is engaged in the business of developing and
distributing software;
WHEREAS, the respective Boards of Directors of each of SPSS and
Surveycraft have determined that it is advisable and for the benefit of their
corporations and their respective shareholders that Surveycraft be acquired by
SPSS by means of the acquisition from the Shareholders by SPSS of all of the
issued capital shares of Surveycraft (the "Shares"), in exchange for cash
pursuant to the terms and conditions set forth herein (the "Acquisition");
WHEREAS, the Shareholders own all of the issued shares in Surveycraft
and have power to sell such shares;
WHEREAS, the parties intend that, for federal income tax purposes, this
transaction qualify for an election under Section 338 of the Internal Revenue
Code of 1986, as amended (the "Code");
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and in reliance upon
the representations and warranties contained herein, the parties hereto agree as
follows:
ARTICLE I
TERMS OF PURCHASE AND SALE
1.1 Purchase and Sale of the Shares. Subject to the terms and
conditions contained in this Agreement, on the Closing Date (as hereinafter
defined), the Shareholders shall sell, assign,
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transfer and deliver the Shares to SPSS, and SPSS shall purchase the Shares from
the Shareholders, for an aggregate purchase price consisting of the items and
amounts set forth in Section 1.3 hereof (the "Purchase Price") payable pursuant
to the terms provided in Section 1.3 hereof.
1.2 Closing. Subject to the terms and conditions of this Agreement, the
closing of the transactions contemplated hereby (the "Closing") shall take place
via facsimile at _____, Australian Eastern Summer Time, on November 13, 1998
(the "Closing Date") at the offices of Xxxx & Xxxxxxx, Xxxxxxx, Xxxxxxxx 00000
X.X.X. and Xxxxxx Solicitors, 0 Xxxxxxxx Xxxxxx, Xxx Xxxx, Xxxxxxxx Xxxxxxxxx
0000, or such other place or time as the parties may agree.
1.3 Payment of Purchase Price. Upon satisfaction of all the terms and
conditions set forth in this Agreement, on the Closing Date SPSS shall deliver
the Purchase Price consisting of ONE MILLION SEVEN HUNDRED TWENTY-TWO THOUSAND
FIVE HUNDRED EIGHTY SEVEN U.S. DOLLARS (U.S. $1,722,587), to be paid as follows:
(a) by November 16, 1998, Australian Eastern Summer Time, SPSS shall deliver to
the Shareholders ONE MILLION FIVE HUNDRED FIFTY THOUSAND THREE HUNDRED
TWENTY-EIGHT U.S. DOLLARS (U.S. $1,550,328) by wire transfer of immediately
available funds to an account designated by the Shareholders by written notice
to SPSS given on or before the Closing Date, to be allocated between the
Shareholders as set forth in Schedule 1.3 hereof, and (b) by November 16, 1998,
Eastern Standard Time, SPSS shall deliver to the Escrow Agent (as defined
herein) ONE HUNDRED SEVENTY-TWO THOUSAND TWO HUNDRED FIFTY-NINE U.S. DOLLARS
(U.S. $172,259) (the "Escrowed Amount") by wire transfer of immediately
available funds to an account designated by the Escrow Agent by written notice
to SPSS given on or before the Closing Date, to be held in escrow in accordance
with Article II hereof.
1.4 Tax and Accounting. The parties hereto shall each use their best
efforts to cause the transactions contemplated hereunder to qualify for an
election pursuant to Section 338 of the Code.
ARTICLE II
ESCROW
2.1 Appointment of Escrow Agent. Xxxxxx Solicitors, a partnership
organized under the laws of Australia, is hereby appointed to act as escrow
agent ("Escrow Agent") hereunder, and Escrow Agent hereby accepts such
appointment in accordance with the terms set forth in this Section 2. The Escrow
Agent shall hold the funds for the benefit of SPSS and shall act strictly in
accordance with the terms and conditions of this Section 2, which sets out the
duties and obligations of the Escrow Agent.
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2.2 Deposit of Escrowed Amount. Surveycraft and the Shareholders,
and each of them, hereby deposit with Escrow Agent, and Escrow Agent
acknowledges receipt of, the amounts set forth on Schedule 2.1 hereof (the
"Escrowed Amount"). The Escrow Agent shall hold the Escrowed Amount in a demand
deposit account with an institutional lender (the "Escrow Account"). The
Escrowed Amount shall be held as collateral to satisfy claims for
indemnification against Surveycraft and the Shareholders by SPSS under this
Agreement.
2.3 Release of Escrowed Amount.
(a) In the event the Shareholders are obligated to
make any Indemnification Payment under Section 12 of this Agreement, SPSS shall
give the Escrow Agent written notice of such Indemnification Payment or event
setting forth in reasonable detail the amount of any such Indemnification
Payment and the basis for such claim. Upon receipt of such notice, the Escrow
Agent shall release from the Escrow Account and deliver to SPSS an amount equal
to the Indemnification Payment, up to the Escrowed Amount. Surveycraft, the
Shareholders and SPSS hereby agree that from the date hereof, up to February 28,
1999, any Indemnification Payment to which SPSS is entitled shall be made first
out of the Escrow Account (to the extent sufficient funds therefor remain in the
Escrow Account). If the Escrow Account does not contain funds sufficient to
satisfy any Indemnification Payment, the Shareholders shall pay the deficiency
to SPSS.
(b) Any amounts remaining in the Escrow Account after
payments therefrom are made to SPSS in accordance with this Agreement, if any,
will be delivered to the Shareholders, in amounts proportionate to each
Shareholder's interest in Surveycraft prior to Closing as shown on Schedule 1.3,
promptly (and in any event within five (5) business days) after February 28,
1999.
2.4 Grant of Security Interest. Surveycraft and the Shareholders,
and each of them, hereby pledge, assign, and grant to SPSS, as security for any
post-Closing claims for breaches under this Agreement, all of Surveycraft's and
the Shareholders' right, title, and interest in and to the Escrowed Amount, and
Surveycraft and the Shareholders, and each of them, agree that SPSS shall have a
security interest in the Escrowed Amount, as such term is defined under the laws
of Victoria, Australia. All of the rights and remedies available to SPSS under
such laws are in addition to SPSS' rights set forth herein and the security
interest pledged, assigned and granted to SPSS hereunder is not intended in any
way to limit the aforesaid rights and remedies of SPSS.
2.5 No Further Pledge or Encumbrance. Surveycraft and the
Shareholders, and each of them, shall not further pledge, assign or grant any
security interest in the Escrowed Amount or permit any lien or encumbrance to
attach thereto, or any levy to be made thereon.
2.6 Further Agreements, etc. Surveycraft and the Shareholders, and
each of them, (a) shall execute any instruments or take any steps reasonably
required by SPSS in order that notice of the security interest granted by
Surveycraft and the Shareholders to SPSS pursuant to this Section shall be given
to all appropriate parties and/or as may be required to enable SPSS to enforce
its rights under this Section; (b) shall execute, at the request of SPSS, all
financing
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statements and other instruments and documents required by SPSS to perfect the
security interest intended to be created pursuant to the provisions of this
Section; (c) authorize SPSS, to the extent SPSS may lawfully do so, to execute
and file at any time financing statements or their equivalent under the laws of
Victoria, Australia without the signature of Surveycraft or the Shareholders
with respect to any security interest granted to SPSS pursuant to this Section.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SURVEYCRAFT
AND THE SHAREHOLDERS
Surveycraft and the Shareholders, jointly and severally, represent and
warrant to SPSS as follows:
3.1 Organization and Qualification. (a) Surveycraft is a
corporation duly organized, validly existing and in good standing under the laws
of Australia and has the corporate power and authority to enter into this
Agreement, to consummate the transactions contemplated hereby, to own or lease
the properties and other assets which it presently owns or leases and to carry
on its business as presently conducted. Surveycraft Systems, Inc. ("Surveycraft
U.S."), is wholly owned by Surveycraft and is a corporation duly organized,
validly existing under the laws of the State of Ohio, is in good standing and
qualified to transact business in the State of Ohio, and has the power and
authority to own or lease the properties and other assets which it presently
owns or leases and to carry on its business as presently conducted. Surveycraft
Limited ("Surveycraft U.K.") is wholly owned by Surveycraft and is a corporation
duly organized validly existing under the laws of England and has the power to
own or lease the properties and other assets which it presently owns or leases
and to carry out its business as presently conducted. (Surveycraft U.S. and
Surveycraft U.K. are hereinafter, each a "Subsidiary," and collectively, the
"Subsidiaries.")
(b) The copy of the Memorandum of Association and all
amendments thereto, and of the Articles of Association, as amended to date, of
Surveycraft, as certified by Xxxx Xxxxxxx Xxxxx ("Xxxxx") as Surveycraft's
Director, being delivered herewith to SPSS, are true, complete and correct
copies as amended and presently in effect. The copies of any organizational and
governing documents of Subsidiaries as certified by the appropriate government
authorities, being delivered herewith, are true, complete and correct copies as
amended and presently in effect. All minutes and consents of the shareholders
and directors of Surveycraft and Subsidiaries are contained in the minute books
of Surveycraft and Subsidiaries, and said minute books have been furnished to
SPSS for examination at a reasonable time prior to the Closing. No minutes or
consents have been included in such minute books since such examination by SPSS
which have not heretofore been furnished to SPSS and no corporate action not
reflected in said minute books has been taken except for resolutions to be
enacted at closing for the purposes of effecting the transactions contemplated
by this agreement.
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(c) Surveycraft and Subsidiaries are each duly licensed or
qualified to do business as a foreign corporation, and are each in good
standing, in every domestic and foreign jurisdiction in which each of
Surveycraft and Subsidiaries are required to be so licensed or qualified.
3.2 Authority. Surveycraft and the Shareholders, on their own
behalf, as appropriate, have full power, capacity and authority (corporate or
otherwise) to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized and approved by all necessary action on the part of each of
theShareholders and the Board of Directors of Surveycraft and no other
proceedings (corporate or otherwise) on the part of the Shareholders or
Surveycraft are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement and the other agreements
contemplated by this Agreement have been duly and validly executed and delivered
by each of the Shareholders and Surveycraft, and constitute legal, valid and
binding agreements of Surveycraft and the Shareholders.
3.3 Capitalization. The entire authorized capital stock of
Surveycraft and the number of Shares thereof which are issued are as follows:
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NUMBER OF
AUTHORIZED SHARES NUMBER
OF SURVEYCRAFT CLASS ISSUED
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500,000 Ordinary 300,000
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100,000 A 33,333
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100,000 B -0-
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100,000 C -0-
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100,000 D -0-
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100,000 E -0-
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All of the issued Shares of Surveycraft's capital stock are owned by the
Shareholders in the respective amounts set forth in Schedule 3.3 hereto, and the
Shareholders each have the power to sell such Shares. Surveycraft owns all of
the issued and outstanding shares of the Subsidiaries' capital stock (the
"Subsidiary Shares"). The Shares and Subsidiary Shares are subject to no
restrictions on transferability other than restrictions imposed by the 1933 Act,
applicable United States state securities laws and Australian securities laws.
All of the issued Shares of capital stock of Surveycraft and Subsidiaries are
duly authorized and validly issued, fully paid and
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non-assessable, and were not issued in violation of any preemptive rights. There
are no Shares of capital stock in treasury, and there are no Shares or
Subsidiary Shares reserved for issuance. There are no outstanding options,
warrants, conversion or other rights to acquire from any of the Shareholders or
Surveycraft, or any plans, contracts or commitments providing for the issuance
of, or the granting of, rights by the Shareholders or Surveycraft to acquire:
(i) any capital stock of Surveycraft or Subsidiary Shares (in each case whether
issued or unissued) or (ii) any securities convertible into or exchangeable for
any capital stock of Surveycraft or Subsidiary Shares. There are no agreements
or understandings with respect to the voting, holding or selling of any Shares
of capital stock of Surveycraft or Subsidiary Shares, or any contractual
obligations of Surveycraft or any of the Shareholders with respect to
Surveycraft's capital stock or Subsidiary Shares. There are no voting trusts,
proxies or powers of attorney currently in effect with respect to the Shares or
Subsidiary Shares. No person has any right to require Surveycraft or Subsidiary
to register any of its securities under the 1933 Act or pursuant to applicable
Australian law.
3.4 Title to Shares. The Shareholders own and have good and
marketable title to the Shares, free and clear of any lien, pledge, claim,
encumbrance, restriction or right of any third party of any kind. On the Closing
Date, SPSS will acquire good and marketable title to the Shares and Subsidiary
Shares, free and clear as aforesaid, including without limitation, any of the
foregoing set forth in the Articles of Association of Surveycraft. The Shares
represent the only equity interest of the Shareholders in Surveycraft.
3.5 Consents and Approvals. Except as set forth in Schedule 3.5
hereto, there is no authorization, consent, order or approval of, or notice to
or filing with, any individual or entity required to be obtained or given in
order for Surveycraft and the Shareholders to consummate the transactions
contemplated hereby and fully perform their respective obligations hereunder.
3.6 Absence of Conflicts. The execution, delivery and performance by
Surveycraft and the Shareholders of this Agreement and the consummation by
Surveycraft and the Shareholders of the transactions contemplated hereby will
not, with or without the giving of notice or lapse of time or both, (i) violate
any provision of law, statute, rule or regulation to which either Surveycraft or
the Shareholders are or were subject, (ii) violate any order, judgment or decree
which is or was applicable to either Surveycraft or the Shareholders; (iii)
conflict with or result in a breach or default under any term or condition of
the Memorandum of Association or Articles of Association of Surveycraft, or any
agreement or other instrument to which either Surveycraft or the Shareholders
are a party or by which either of them is bound, or (iv) cause, or give any
person grounds to cause, the maturity of any debt, liability or obligation of
Surveycraft to be accelerated or increase any such liability or obligation.
3.7 Financial Statements. Surveycraft shall, within seven (7) days
after Closing, deliver to SPSS true and correct copies of the unaudited balance
sheets of Surveycraft and Subsidiaries, as of September 30, 1998 and the related
unaudited statements of income, statements of retained earnings (collectively,
the "Financial Statements"). Except as disclosed on Schedule 3.7, the Financial
Statements (i) have been prepared in accordance with generally accepted
Australian
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accounting principles applied on a consistent basis, are correct and complete
and are in accordance with the books and records of Surveycraft and
Subsidiaries, (ii) present fairly the financial position and condition of
Surveycraft and Subsidiaries and the related results of operations as at the
dates and for the periods then ended (subject to customary year-end adjustments,
which adjustments shall not be material in kind or amount) and (iii) contain no
material misstatements or omissions which under generally accepted Australian
accounting principles would be required to be disclosed for financial statement
purposes. A dividend to the extent of retained profits for the consolidated
entity (Surveycraft, Surveycraft U.S. and Surveycraft U.K.) will be declared as
of October 31, 1998 and distributed in accordance with the share registry of
Surveycraft on that date; provided, however, that such dividend will be subject
to SPSS' approval and will be calculated taking into account all necessary
accruals, including, but not limited to Surveycraft's long service leave
obligations and all professional fees incurred by Surveycraft and the
Shareholders in conjunction with the transactions contemplated hereunder.
Subject to applicable reserves for bad debts shown on Surveycraft's and
Subsidiaries latest balance sheets included in the Financial Statements, as such
reserves are adjusted from the date thereof in the ordinary course of business,
all accounts and notes receivable reflected on the balance sheets are, and all
accounts and notes receivable subsequently accruing to the Closing Date will be
(a) valid, genuine and subsisting, (b) subject to no known defenses, setoffs or
counterclaims and (c) current and collectible.
3.8 Absence of Undisclosed Liabilities. Except as and to the extent
reserved for in the Financial Statements or as set forth in Schedule 3.8 hereto,
neither Surveycraft nor either Subsidiary has any liabilities or obligations,
whether accrued, absolute or contingent, determined or undetermined, known or
unknown or whether due or to become due (including, without limitation,
obligations as guarantor) other than those in the ordinary course of business
since September 30, 1998, which have not yet been accrued or booked. Surveycraft
does not know of any basis for the assertion of any claim or liability relating
to the businesses of Surveycraft or either Subsidiary, nor is Surveycraft or
either Subsidiary aware of any occurrence or fact that has or might have an
adverse effect on the businesses of Surveycraft or either Subsidiary. Except as
disclosed in Schedule 3.8, as of the date of this Agreement, neither Surveycraft
nor either Subsidiary has outstanding debt to any bank or other lender.
3.9 Absence of Certain Changes or Events. Except as set forth on
Schedule 3.9 hereto, since September 30, 1998, there has not been (a) any
damage, destruction or casualty loss to the properties or assets of Surveycraft
or either Subsidiary (whether covered by insurance or not) outside the ordinary
course of business; (b) any material adverse change in the business, assets,
properties, operations, prospects or financial condition of Surveycraft or
either Subsidiary or any fact or condition which could cause such a change,
other than any change, fact or condition related solely to the transactions
contemplated hereby; (c) any entry into any transaction, commitment or agreement
(including, without limitation, any borrowing) in excess of U.S. $10,000.00, or
outside the ordinary course of business of Surveycraft or either Subsidiary; (d)
any direct or indirect redemption, repurchase or other acquisition for value by
Surveycraft of its capital stock or any
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agreement to take such action, or any declaration, setting aside or payment of
any dividend or other distribution in cash, stock or property with respect to
Surveycraft's capital stock; (e) any increase in the rate or terms of
compensation payable or to become payable by Surveycraft or either Subsidiary to
their respective directors, officers, employees, agents or independent
contractors or any increase in the rate or change in the terms of any employment
agreement or compensatory arrangement, or any changes in any bonus, severance,
pension, insurance or other employee benefit plan, or any other payment or
benefit made to or for any such director, officer, employee, agent or
independent contractor; (f) any sale, transfer or other disposition of any asset
of Surveycraft or either Subsidiary to any party, including, without limitation,
the Shareholders, except for payment of obligations incurred, and sale of
products, in the ordinary course of business consistent with past practices; (g)
any amendment or termination of any material contract or agreement to which
Surveycraft or either Subsidiary is a party or any termination or waiver of any
other rights of value to the businesses of Surveycraft or either Subsidiary; (h)
any capital expenditure for additions to property or equipment by Surveycraft or
either Subsidiary in excess of U.S. $10,000.00; (i) any split, combination,
exchange or reclassification of shares of capital stock of Surveycraft or either
Subsidiary; (j) any issuance of capital stock of Surveycraft or either
Subsidiary or of securities convertible into or rights to acquire any such
capital stock; (k) any failure by Surveycraft or either Subsidiary to pay
accounts payable or other obligations in the ordinary course of business; (l)
the incurrence of any obligations or liability (absolute or contingent) or the
making of any capital expenditure not in the ordinary course of business or in
excess of U.S. $10,000.00; (m) any pledge of any of the assets or properties of
Surveycraft or either Subsidiary or any action or inaction which would subject
any such assets or properties to any lien, security interest, mortgage, pledge,
claim, charge or other encumbrance of any kind; (n) the incurrence of any
liability or obligation by Surveycraft or either Subsidiary, except for
liabilities incurred in the ordinary course of business; (o) any actual or
threatened termination or cancellation of, or modification or change in, any
business relationship with any customer or customers of Surveycraft or either
Subsidiary or other agreement or arrangement involving or related to the assets
or properties of the businesses of Surveycraft or either Subsidiary; (p) any
cancellation of a debt due to or a claim of Surveycraft or either Subsidiary,
other than by payment or other satisfaction; (q) any failure of Surveycraft or
either Subsidiary to perform under, or any default by Surveycraft under, any
agreement, obligation or covenant to which Surveycraft or either Subsidiary is
or was bound; (r) any change in any method of accounting or accounting practice,
principle or procedure; (s) any action or inaction which might cause Surveycraft
or either Subsidiary to incur any tax liability out of the ordinary course of
business ; (t) any other event or condition of any character which materially
and adversely affects the businesses of Surveycraft or either Subsidiary; or (u)
any agreement, whether in writing or otherwise, to take any action described in
this Section 3.9.
3.10 Real and Personal Property; Inventories. Schedule 3.10(a) hereto
correctly identifies (i) each lease or rental of real property held or paid by
each of Surveycraft and each Subsidiary; and (ii) each parcel of real property,
and each interest (other than such leases or rentals) in real property, used in
the operations of the businesses of each of Surveycraft and each Subsidiary.
Except as set forth in Schedule 3.10(a) hereto, (a) any structures described in
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Schedule 3.10(a) and Surveycraft's and either Subsidiary's use thereof conform
in all material respects with all applicable ordinances, requirements,
regulations, zoning laws, restrictive covenants, conditions and restrictions and
do not encroach on property of others, and are not encroached upon by structures
of others; and (b) no claims, charges or notice of violations have been filed,
served, made or threatened, orally or in writing, against or relating to any
such property or any of the operations conducted at any such property (currently
or in the past) as a result of (i) any violation or alleged violation of any
applicable ordinances, requirements, regulations, zoning laws, restrictive
covenants, conditions or restrictions, or (ii) as a result of any encroachment
on the property of others. Schedule 3.10(b) hereto describes all material
tangible or intangible personal property and assets of Surveycraft and each
Subsidiary. Surveycraft and each Subsidiary have good and marketable title to,
and are in possession of or have control over, all of their respective real and
personal property, none of which is held under or subject to any mortgage,
pledge, lien, lease, encumbrance, conditional sales contract or other security
arrangement except to the extent described in Schedule 3.10(b) hereto. Each item
of such tangible personal property and assets is in good working order or
condition, reasonable wear and tear excepted.
The inventories of Surveycraft and each Subsidiary are in good and
merchantable condition and are of a quality suitable and usable or saleable in
the ordinary course of business for the purposes for which such inventories are
intended. The inventory is adequate for each of Surveycraft's and Subsidiary's
businesses and there has been no material adverse change in such inventories
since September 30, 1998.
3.11 Patents, Trademarks, Etc.
Schedule 3.11 contains an accurate and complete description of
all domestic and foreign patents, trademarks, current service marks, trademark
registrations, logos, trade names, assumed names, copyrights and copyright
registrations and all pending applications therefor and all registered designs
and design rights (collectively, the "Intellectual Property"), presently owned
or held by each of Surveycraft and each Subsidiary or under which Surveycraft or
either Subsidiary owns or holds any license, or in which Surveycraft or either
Subsidiary owns or holds any direct or indirect interest; and no others are
necessary for the conduct of the present business of Surveycraft or either
Subsidiary. None of the products manufactured, distributed or sold by
Surveycraft or either Subsidiary, nor any of the Intellectual Property, or other
intellectual property (including without limitation, technology, inventions,
processes, designs, formulae, know-how, trade secrets (collectively, with the
Intellectual Property, the "Intellectual Assets"), or any of Surveycraft's and
Subsidiary's activities, conflict with, infringe or otherwise violate any
patents, trademarks or copyrights or any other rights of any individual or
entity, nor require payments to be made to any person. Each of Surveycraft and
Subsidiary has the sole and exclusive right to use, has the right and power to
sell, and has taken reasonable measures to maintain and protect the Intellectual
Assets. No claims have been asserted by any individual or entity with respect to
the Intellectual Assets or challenging or questioning the effectiveness of any
license or agreement with respect thereto, and there exists no basis for any
such claim. Neither Surveycraft nor Subsidiary is using confidential
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information or trade secrets of any former employer of any past or present
employees engaged in businesses of Surveycraft or either Subsidiary. The items
described in the schedules attached hereto and the other Intellectual Assets are
reasonably adequate to conduct the businesses of each of Surveycraft and each
Subsidiary as presently conducted. Upon consummation of the transaction
contemplated hereby, SPSS will acquire good and marketable title to all of the
Intellectual Assets and the goodwill associated therewith.
3.12 Employees. All personnel, including employees, agents,
consultants and contractors, who have contributed to or participated in the
conception and development of the Intellectual Assets on behalf of Surveycraft
or either Subsidiary either (a) were at such time parties to "work-for-hire"
arrangements or agreements with either Surveycraft or Subsidiary, in accordance
with applicable law, that has accorded Surveycraft or either Subsidiary full,
effective, exclusive and original ownership of all intellectual property thereby
arising, or (b) have executed appropriate instruments of assignment, which are
still in full force and effect, in favor of Surveycraft or either Subsidiary, as
assignee, that have conveyed to Surveycraft or either Subsidiary full, effective
and exclusive ownership of all intellectual property thereby arising. Neither
Surveycraft nor either Subsidiary owns or has any right, license or interest,
whether as a licensee, licenser or otherwise, in any copyrights, patents,
applications for copyrights or patents, trade secrets, inventions, processes and
designs or in any trademarks, service marks, trade names, or applications for
them, except as listed or described in Schedule 3.12. No employee of Surveycraft
or either Subsidiary is in violation of (i) any term of any employment contract,
any "work for hire" arrangement or agreement, or any patent disclosure agreement
or (ii) any other contract or agreement, or any restrictive covenant relating to
the rights of any such employee to be employed by Surveycraft or either
Subsidiary or to use trade secrets or proprietary information of others.
3.13 Contracts and Commitments.
(a) Other than standard form customer and distributor
contracts entered into in the ordinary course of business, and except as set
forth in Schedules 3.10(a), 3.13(a), 3.14, 3.15, and 3.33 hereto, neither
Surveycraft nor either Subsidiary is a party to any agreements, contracts,
guarantees, commitments, restrictions or instruments of any kind ("Contracts").
True and correct copies of all Contracts listed on Schedules 3.10(a), 3.13(a),
3.14, 3.15, and 3.33 hereto have been made available to SPSS at a reasonable
time prior to Closing. All of the Contracts are valid and binding obligations of
Surveycraft or either Subsidiary, enforceable in accordance with their
respective terms to the extent permitted by applicable law, and are in full
force and effect and complied with. No other party to any of the Contracts is in
default or breach thereof. True and correct copies of each standard form
customer and distributor contract currently in use by each of Surveycraft and
each Subsidiary in the conduct of their respective businesses are attached to
Schedule 3.13(a). All non-standard form customer and distributor contracts are
listed on Schedule 3.13(a). Neither Surveycraft nor either Subsidiary has agreed
with any customer or distributor to make any variation in any such contract
which could have a material adverse effect on Surveycraft's or either
Subsidiary's assets, properties, businesses, financial condition or prospects.
As used herein, Amaterial adverse effect" shall mean any adverse effect in
excess of $100,000.00.
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(b) Neither Surveycraft nor either Subsidiary has given any
power of attorney (whether revocable) or irrevocable to any individual or
entity.
(c) Neither Surveycraft nor either Subsidiary is in default,
and there is no basis for any valid claim of default, in any respect under any
of the Contracts.
3.14 Source Code. Except as set forth in Schedule 3.14, Surveycraft
and Subsidiaries own all rights, title and interest in and to the source codes
for all of their respective software products and have not distributed any
copies of such source codes to any third parties, except for copies of the
source code relating to products which are now obsolete, and have not agreed to
pay to any individual or entity any royalty, commission or other amount on
account of sales of their software products.
3.15 Rights in Source Code. Except as set forth on Schedule 3.15,
neither Surveycraft nor either Subsidiary has granted to any individual or
entity any rights or security interests with respect to the source codes for
Surveycraft's or either Subsidiary's software products; provided, however, that
in some circumstances a licensee of Surveycraft's software may have a right to
obtain the source code of that software in the event that Surveycraft is unable
to provide technical support or service of such software by Surveycraft due to
insolvency. Surveycraft is not insolvent.
3.16 Adequacy of Documentation. Except as set forth in Schedule
3.16, the technical documentation includes the source code, system
documentation, for all of the software products currently maintained by or
licensed to Surveycraft or either Subsidiary, as well as any pertinent
commentary or explanation (the "Technical Documentation"), provided, however,
that in connection with Surveycraft's ongoing software development, certain
Technical Documentation may, in the ordinary course of business, not be current
with the corresponding software.
3.17 Third-Party Licenses.
(a) Neither Surveycraft nor either Subsidiary is (i) except as
set forth on Schedule 3.17(a)(i), a licensee under a license from a third party
with respect to the source code used in Surveycraft's or either Subsidiary's
software; or (ii) except as set forth on Schedule 3.17(a)(ii), bound by an
obligation to pay royalties to a third party with respect to source code used in
Surveycraft's or either Subsidiary's software.
(b) Neither Surveycraft nor either Subsidiary has breached or
caused to exist a default under any license referred to in Schedule 3.17(a)(i)
or (ii) and there is no basis for any valid claim or default under any such
license.
3.18 Third-Party Interests or Marketing Rights in Software
Programs. All of Surveycraft's and Subsidiaries' standard form customer
contracts constitute only end-user agreements, each of which grants the end-user
thereunder solely the non-exclusive right and license to use an identified
software product of Surveycraft or either Subsidiary and related user
documentation, for internal
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purposes only. There are no contracts, agreements, licenses or other commitments
or arrangements in effect with respect to the development, marketing,
distribution, licensing, or promotion of Surveycraft's or either Subsidiary's
software products or any other inventory, the Technical Documentation, or
Surveycraft's or either Subsidiary's Intellectual Assets with any independent
salesperson, distributor sublicensor, or other remarketer or sales organization,
except for Contracts identified in Schedules 3.3 and 3.14 and 3.17.
3.19 No Virus Warranties. To the best of Surveycraft's and the
Shareholders' knowledge, the software products, as delivered to SPSS, shall be
free of any passwords, keys, security devices or trap doors, and any computer
instructions (including, but not limited to, computer instructions commonly
referred to as Trojan Horses, anomalies, worms, self-destruct mechanisms, or
time/logic bombs) which are intended to interfere with or frustrate the use of
the software products, any portion thereof, or other software or computer
hardware, whether or not currently in effect with respect to any copy of
Surveycraft's or either Subsidiary's software products. Notwithstanding the
foregoing, certain of Surveycraft's software is equipped with a "time-out code"
and/or a dongle security devices to prevent end-users access to such software if
license fees owed to Surveycraft by such end users are unpaid.
3.20 Software: Physical Media. Except as set forth on Schedule 3.20,
and subject to the provisions of Section 3.16, to the best of Surveycraft's
knowledge, Surveycraft's and Subsidiaries' software products, other than that
currently under development, will operate in accordance with the Technical
Documentation. The software products and any licenses or other rights connected
therewith, express or implied, will not infringe any other person's intellectual
property rights. To the best of Surveycraft's knowledge, each copy of the
software product is free from physical defects in the media that tangibly
embodies the copy. Attached as Schedule 3.20 is, to the best of Surveycraft's
knowledge, a complete list of all known replicable program faults or errors
existing in each of the software products currently sold by Surveycraft or
Subsidiaries. Schedule 3.20 includes the estimated number of labor hours
required to correct each such fault or error in the software and the impact of
each such fault or error in the software on the functionality of Surveycraft's
and Subsidiaries' software products based on a ten point scale, with ten being
the highest. Notwithstanding anything herein to the contrary, no major
development efforts are required to render the software programs functional.
3.21 Non-Infringement. Surveycraft's and each Subsidiary's software
products and any licenses by Surveycraft or either Subsidiary or other rights
connected therewith, express or implied, will not infringe on any other person's
intellectual property rights.
3.22 Government Contracts. Surveycraft does not have knowledge of any
acts, omissions or noncompliance with regard to any applicable public
contracting statute, regulation or contract requirement (whether express or
incorporated by reference) to any contracts relating to Surveycraft or either
Subsidiary, their respective businesses or any of their respective assets with
any Government Contract Party (as defined below) in either case that have led to
or could lead to (a) any claim or dispute involving Surveycraft or either
Subsidiary, its businesses, or any of its assets and
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any Government Contract Party or (b) any suspension, debarment or contract
termination, or proceeding related thereto. Surveycraft has no knowledge of any
act or omission related to the marketing, licensing, or selling of any
technology related to Surveycraft or either Subsidiary, or its business that has
led to or could have any material adverse affects on either Surveycraft's or
Subsidiary's rights or on any of its assets. All of Surveycraft's and
Subsidiaries' development of technology was developed exclusively at private
expense. For purposes of this Section 3.22, the term "Government Contract Party"
means any independent or executive agency, division, subdivision, audit group or
procuring office of any government, including any prime contractor of any
government and any higher level subcontractor of a prime contractor of any
government, and including any employees or agents thereof, in each case acting
in such capacity.
3.23 Insurance. Each of Surveycraft and each Subsidiary keeps all of
its businesses, operations and properties insured against loss or damage, with
responsible insurers. Schedule 3.23 hereto is a description of all insurance
policies held by each of Surveycraft and each Subsidiary concerning its
businesses, operations and properties, true, complete and correct copies of
which have been previously provided to SPSS. All such policies are set forth in
Schedule 3.23, and such insurance is adequate and appropriate in accordance with
sound business practices. Each of the insurance policies referred to in Schedule
3.23 is in force and the premiums with respect thereto are fully paid. No
insurer has denied coverage or reserved rights for any claim made by Surveycraft
or any other individual or entity under any insurance policies.
3.24 Litigation and Administrative Proceedings. Except as set forth
in Schedule 3.24 hereto, there is no claim, action, suit, proceeding or
investigation in any court or before any governmental or regulatory authority
pending or threatened against or affecting Surveycraft or either Subsidiary or
which seeks to enjoin or obtain damages in respect of the transactions
contemplated hereby. Surveycraft does not know nor have any reason to know of
any basis for any such claim, action, suit, proceeding or investigation. No
claim, action, suit, proceeding or investigation set forth in Schedule 3.24
could, if adversely decided, have a material adverse effect on the business,
properties, condition (financial or otherwise) or prospects of Surveycraft or
either Subsidiary.
3.25 Tax Matters. For purposes of this Agreement:
(a) The term "Taxes" means all federal, state, territory, local and
foreign taxes imposed by the Australian taxing authority or by any other taxing
authority, including without limitation all income (including capital gains),
net income, gross income, gross receipts, sales, use, ad valorem, transfer,
franchise, profits, license, lease, service, service use, withholding (including
deduction pursuant to the royalty withholding obligation), payroll, employment,
excise, severance, financial institutions, duty, debit, municipal rates,
franking deficit, franking additional, pay-as-you-earn remittances, prescribed
payments, stamp, occupation, premium, property, windfall profits, customs,
duties, fringe benefits or other taxes, fees, assessments, imports, duties and
levies, fines or charges of any kind whatever, together with any interest and
any penalties, additions to tax, or additional amounts with respect thereto, and
the term "Tax" means any one of the foregoing Taxes;
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(b) The term "Returns" means all returns, declarations, reports,
statements, elections and other documents required to be filed or made in
respect of Taxes, and the term "Return" means any one of the foregoing Returns;
3.25.1 All Returns Filed. All Returns required to be filed
by or on behalf of Surveycraft or either Subsidiary on or before the Closing
Date have been filed, or proper extensions for the filing of such Returns have
been filed, and such Returns are complete and accurate and disclose all Taxes
(and other charges) for the periods covered thereby. Except as set forth in
Schedule 3.25.1, no extension of time in which to file any such Returns is
currently in effect and there are not outstanding agreements or waivers
extending the statutory period of limitation applicable to such Returns.
3.25.2 All Taxes Paid. All Taxes (and other charges) shown
on such Returns or otherwise required to be paid, and any deficiency
assessments, penalties, interest and other charges with respect thereto, have
been paid, and there is otherwise no current liability for any unpaid Taxes (or
other charges) due in connection with such Returns or otherwise. There are no
tax liens on any of the assets or properties of Surveycraft or either
Subsidiary, and, to the best knowledge of the Shareholders and Surveycraft, no
basis exists for the imposition of any such liens.
3.25.3 Examinations, Etc. No state, local, foreign or other
Returns of Surveycraft or either Subsidiary for tax years that remain open under
any applicable statute of limitations have been examined by pertinent tax
authorities and no deficiencies have been asserted or assessments made as a
result of examinations (including all penalties and interest). Neither
Surveycraft nor either Subsidiary has been notified that any issues have been
raised by (or are currently pending before) any taxing authority in connection
with any of the Returns which could reasonably be expected to have a material
adverse effect on the financial condition of Surveycraft or either Subsidiary,
taken as a whole, if decided adversely to Surveycraft or either Subsidiary, nor
are there any such issues which have not been so raised but, if so raised by any
taxing authority in connection with any of the Returns could, in the aggregate,
reasonably be expected to have a material adverse effect on the financial
condition of Surveycraft or either Subsidiary.
3.25.4 Franking Accounts. In relation to each of Surveycraft
and each Subsidiary, all credits and debits to any franking account maintained
by each of Surveycraft and each Subsidiary have been duly and properly recorded
in accordance with the Tax Act (as hereinafter defined) giving rise to a
franking account balance in conformity with the Tax Act, and there are no
existing or pending statutory franking debits in relation to dividend streaming
arrangements, on-market share buy-back purchases or otherwise. For purposes of
this Section 3.25, "Tax Act" means the following Australian acts and
regulations. The Income Tax Assessment Xxx 0000, the Income Tax Assessment 1997,
the Taxation Administration Xxx 0000, the Income Tax Rates Xxx 0000 and other
rating acts, the Income Tax Regulations and related Commonwealth income taxation
legislation and regulations.
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3.25.5 Capital Gains. Neither Surveycraft or any of the
Subsidiaries has sought capital gains tax relief under either section 160ZZ0 of
the Income Tax Assessment Xxx 0000 or Subdivision 126-B of the Income Tax
Assessment Act 1997 with respect to any asset acquired by any of them and which
is still owned by the relevant company at the date of this Agreement.
3.26 Compliance with Laws. Except as disclosed in Schedule 3.26,
neither Surveycraft nor either Subsidiary has in the past been or is presently
in violation of, in respect of its respective operations, real property,
machinery, equipment, all other property, practices and all other aspects of its
businesses, any applicable law (whether statutory or otherwise), rule,
regulation, order, ordinance, judgment or decree of any governmental authority
(federal, state, local or otherwise) (collectively, "Laws"). Except as disclosed
in Schedule 3.26, neither the Shareholders nor Surveycraft nor either Subsidiary
has received any notification of any asserted present or past failure of
Surveycraft or either Subsidiary to comply with any of such Laws.
3.27 Environmental Matters. (a) Except as otherwise disclosed in
Schedule 3.27 hereto, (i) Surveycraft and its predecessors and the subsidiaries
of either, if any, have obtained all Environmental Permits (as defined herein)
that are required with respect to the business, operations and properties of
Surveycraft and its predecessors and the subsidiaries of either; (ii)
Surveycraft and its predecessors and their respective subsidiaries have been,
and Surveycraft is, in compliance with all terms and conditions of all
Environmental Laws (as defined herein) and Environmental Permits; (iii) neither
Surveycraft nor its predecessors or their respective subsidiaries have received
any notice from a governmental authority or third party of any violation of or
potential liability arising under any Environmental Law or Environmental Permit
in connection with the business of Surveycraft or its predecessors or their
respective subsidiaries or the operation thereof, nor is any such notice pending
or to the best of Surveycraft's knowledge, threatened; (iv) no underground or
above ground storage tanks are or have been located on the real properties
described in Schedule 3.10(a) attached hereto or previously owned or operated by
Surveycraft; and (v) Surveycraft is not aware of any generation, treatment,
storage, transfer, disposal, release or threatened release in, at, from or on
such real properties of toxic or hazardous substances by any current or previous
owner or tenant of such real properties. Surveycraft has delivered to SPSS all
environmental records and material safety data sheets relating to its business
and operations.
(b) Except as set forth in Schedule 3.27, there is no
condition or any set of facts or circumstances that could give rise to an
Environmental Claim (as defined herein).
(c) Except as set forth in Schedule 3.27, to the best of the
Shareholders' and Surveycraft's knowledge, there have been no releases of
Hazardous Material into the soil, surface water or ground water at its
production facility.
(d) For purposes of this Agreement, the following terms shall
have the respective meanings set forth herein:
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"Environmental Permit" shall mean any permit, license,
approval or other authorization with respect to the business of Surveycraft or
its predecessors or their respective subsidiaries or the operation thereof under
any applicable Environmental Law (as defined herein), including laws,
regulations or other requirements relating to emissions, discharges or releases
of Hazardous Material (as defined herein) into ambient air, surface water,
ground water, or land, or otherwise arising from the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
Hazardous Material by Surveycraft or its predecessors or their respective
subsidiaries or the employees, representatives, contractors or actual agents of
any of such entities.
"Environmental Claim" shall mean any action, lawsuit, claim or
proceeding relating to the business of Surveycraft or its predecessors or their
respective subsidiaries or the operation thereof which seeks to impose
liability, for (i) violation of any Environmental Law, (ii) release of any
Hazardous Material, (iii) noise, (iv) pollution or contamination of the air,
surface water, groundwater or land; (v) solid, gaseous or liquid waste
generation, handling, treatment, storage, disposal or transportation; (vi)
exposure to hazardous or toxic substances; or (vii) the manufacture, processing,
distribution in commerce, use (by Surveycraft or its predecessors or their
respective subsidiaries or the employees, representatives, contractors or actual
agents of any of such entities), or storage (by Surveycraft or its predecessors
or their respective subsidiaries or the employees, representatives, contractors
or actual agents of any of such entities) of chemical substances. An
"Environmental Claim" includes, but is not limited to, a proceeding to issue,
modify or terminate a permit or license, or to adopt or amend a law or
regulation to the extent that such a proceeding attempts to redress violations
of the applicable permit, license, law or regulation which occurred on or prior
to the Closing Date as alleged by any United States, state or local executive,
legislative, judicial regulatory or administrative agency, board or authority or
the Australian or United Kingdom equivalent thereof.
"Hazardous Material" shall mean the following: (i) All
"hazardous substances," as such term is defined in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.A. Sec.
9601(14) or the equivalent Australian or United Kingdom law; (ii) all "hazardous
wastes," as such term is defined in the Resource Conservation and Recovery Act,
42 U.S.C.A. Sec. 6903(5) or the equivalent Australian or United Kingdom law;
(iii) all materials that are classified as hazardous or toxic under any
Environmental Law, as defined below; (iv) petroleum products, including
gasoline, diesel fuel, fuel oil, crude oil, and motor oil, and the constituents
of those products; or (v) medical wastes.
"Environmental Laws" shall mean, without limitation, the
following: the Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C.A. Sec. 9601 et seq.); the Resource Conservation and Recovery Act
(42 U.S.C.A. Sec. 6901 et seq.); the Clean Water Act (33 U.S.C.A. Sec. 1251 et
seq.); the Clean Air Act (42 U.S.C.A. Sec. 7401 et seq.); the Toxic Substance
Control Act (15 U.S.C.A. Sec. 2601 et seq.); the Occupational Safety and Health
Act (29 U.S.C. 651 et seq.); and all other federal, state and local statutes and
ordinances pertaining to protection of the environment, health or safety, and
all amendments made to, and regulations
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promulgated under, the foregoing laws effective at the time of Closing, or any
equivalent Australian or United Kingdom law.
3.28 Employee Benefits.
3.28.1 Attached hereto as Schedule 3.28 is a written list of all
employee benefit plans relating to employee benefits with respect to which each
of Surveycraft and each Subsidiary has incurred or may incur any future or
contingent obligations, commitments, whether legal or voluntary, including,
without limitation, all plans, agreements or arrangements relating to deferred
compensation, superannuation fund, pensions, profit sharing, retirement income
or other benefits, stock purchase, stock ownership and stock option plans, stock
appreciation rights, bonuses, severance arrangements, health and welfare
benefits, disability and life insurance benefits and all other employee benefits
or fringe benefits whether or not committed to writing (collectively referred to
as the "Plans").
3.28.2 Each Subsidiary has, with respect to each Plan, delivered to
SPSS true and complete copies of: (i) all plan texts and agreements and related
trust indentures or annuity contracts; (ii) all material employee communications
relating to each Plan; (iii) the annual reports (including all schedules
thereto) for the most recent three (3) plan years; (iv) the actuarial valuations
for the most recent three (3) plan years; (v) the audited financial statement
and opinions for the most recent three (3) plan years and all communications
with any governmental entity or agency.
3.28.3 Other than claims in the ordinary course of business for
benefits under the Plans, and except as disclosed on Schedule 3.28 there are no
actions, suits, claims or proceedings, pending or threatened, nor does there
exist any basis therefor, which may result in any liability with respect to any
Plan to Surveycraft, either Subsidiary or any Plan or trust thereof.
3.28.4 Each of Surveycraft and each Subsidiary has complied with all
applicable industry awards and agreements, all employment contracts and all
statutory requirements in respect to their respective Plans and their respective
employees and has administered and operated all such Plans in accordance with
their respective terms.
3.28.5 Each of Surveycraft and each Subsidiary has complied with, and
will up to and including the Closing Date continue to comply with, all of its
Superannuation Commitments (as defined herein) and will not increase its
Superannuation Commitments prior to the Closing Date without the written consent
of SPSS.
For the purpose of this Section, "Superannuation Commitment"
means any legal liability (whether arising under an industrial award, or
agreement or otherwise) or voluntary commitment to make contributions to any
superannuation fund, pension scheme or other arrangement which will provide
directors or employees of Surveycraft or any Subsidiary or their respective
dependents with pensions, annuities, lump sum or any other payments upon
retirement or earlier death or otherwise.
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3.28.6 Each of Surveycraft and each of the Subsidiaries has duly made
all necessary payments on behalf of its employees and other persons in order to
avoid incurring any liability to pay any levy, including, without limitation,
the superannuation guarantee charge under the Superannuation Guarantee Charge
Xxx 0000 (Cth) in Australia.
3.29 Licenses and Permits. Surveycraft and Subsidiaries have all
governmental licenses and permits and other governmental authorizations and
approvals required for the conduct of its businesses as presently conducted
("Permits"). Schedule 3.29 hereto includes a list of all Permits.
3.30 Relations With Suppliers and Customers. Neither Surveycraft nor
either Subsidiary nor the Shareholders is required to provide any bonding or
other financial security arrangements in connection with any transaction with
any customer or supplier. Neither Surveycraft nor either Subsidiary nor the
Shareholders has received any notice that any customer or supplier of
Surveycraft or either Subsidiary will cease to do business with Surveycraft or
either Subsidiary or refuse to do business with SPSS after the consummation of
the transactions contemplated hereby.
3.31 Interests in Competitors, Suppliers and Customers. Neither the
Shareholders nor any officer or director of Surveycraft or Subsidiary nor any
entity controlled by or under common control with Surveycraft or either
Subsidiary has any ownership interest in any competitor, supplier or customer of
Surveycraft or either Subsidiary or any property used in the operation of either
of their businesses.
3.32 Employment Matters. Schedule 3.32 hereto is a list of all oral
and written employment or consulting contracts or other agreements or
arrangements providing for remuneration to which Surveycraft or either
Subsidiary is a party or by which either of them is bound, and all these
contracts and arrangements are in full force and effect. There are no oral
contracts or arrangements of the type described in the preceding sentence which,
individually or in the aggregate, exceed U.S. $20,000.00 in value. There have
been no claims of defaults and there are no facts or conditions which if
continued, or with the giving of notice, will result in a default under these
contracts or arrangements.
3.33 Discrimination: Occupational Safety; Labor. No person or party
(including, but not limited to, governmental agencies of any kind) has any
claim, or basis for any action or proceeding, against Surveycraft or either
Subsidiary arising out of any statute, ordinance or regulation relating to
discrimination in employment or employment practices or occupational safety and
health standards which, if upheld, would have an adverse effect on the assets,
properties, businesses or conditions, financial or otherwise, of Surveycraft or
either Subsidiary. There is no pending or threatened equal employment
opportunity enforcement action or labor dispute, strike, or work stoppage
affecting any businesses Surveycraft or either Subsidiary. Neither Surveycraft
nor either Subsidiary has any collective bargaining or similar agreements, nor
do either of them have any obligation to bargain with any labor organization as
the representative of their employees, and there is neither pending, or to
Surveycraft's knowledge threatened, any labor dispute, strike or work stoppage
which affects or which may affect either Surveycraft's or Subsidiary's
businesses or which
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may interfere with the continued operations of Surveycraft or either
Subsidiary. No present or former employee of Surveycraft or either Subsidiary
has any claim against either of them for (a) overtime pay, other than overtime
pay for the current payroll period, (b) wages or salary (excluding bonuses and
amounts accruing under pension and profit sharing plans) for any period other
than the current payroll period, (c) vacation, time off or pay in lieu of
vacation or time off, except as set forth on Schedule 3.33, or (d) any violation
of any statute, ordinance or regulation relating to minimum wages or maximum
hours of work.
3.34 Related Transactions. Neither Surveycraft nor either Subsidiary
has made or entered into any loan, contract, lease, commitment, arrangement or
understanding with any of its officers, directors, employees, shareholders or
any entity controlled by or under common control with Surveycraft or either
Subsidiary, except normal compensation arrangements with officers, all of which
are reasonable in amount and, except as listed on Schedule 3.34, terminable by
Surveycraft or a Subsidiary on 30 days' notice.
3.35 Brokers and Finders. Neither Surveycraft nor either Subsidiary
nor the Shareholders (nor any of their respective officers, directors,
employees, affiliates, associates, or family members), has employed any broker,
finder or investment banker, or incurred any liability for any brokerage fees,
commissions or finders' fees in connection with this Agreement or the
transactions contemplated hereby.
3.36 Questionable Payments. Neither Surveycraft nor Subsidiary nor
the Shareholders, nor any director, officer, agent, employee or other person
associated with or acting on behalf of Surveycraft or either Subsidiary has
directly or indirectly: (a) used any corporate funds for unlawful contributions,
gifts, entertainment or other unlawful expenses relating to political activity;
(b) made any unlawful payment to government officials or employees or to
political parties or campaigns from corporate funds; (c) violated any provision
of the Foreign Corrupt Practices Act of 1977, as amended, or any similar
Australian law; (d) established or maintained any unlawful or unrecorded fund of
corporate monies or other assets; (e) intentionally made any false or fictitious
entry on the books or records of Surveycraft or either Subsidiary; (f) made any
bribe, payoff, influence payment, kickback or other unlawful payment; or (g)
made any bribe or other payment of a similar or comparable nature to any person
or entity, private or public, regardless of form, to obtain favorable treatment
in securing business or to obtain special concessions or treatment.
3.37 Books and Records. The books and records of each of Surveycraft
and each Subsidiary have been maintained in accordance with commercially
reasonable business and bookkeeping practices and accurately reflect in all
respects the business, assets, properties, rights, obligations, liabilities and
operations of each of Surveycraft and each Subsidiary.
3.38 Bank Accounts; Safe Deposit Boxes. Schedule 3.38 hereto sets
forth the names and locations of all banks in which Surveycraft or either
Subsidiary have accounts or safe deposit boxes and the names of all persons
authorized to draw thereon or to have access thereto.
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3.39 Full Disclosure. Surveycraft and the Shareholders have disclosed
in writing in, or pursuant to, this Agreement all facts material to the
business, operations, assets or condition (financial or otherwise) of each of
Surveycraft and each Subsidiary. No representation or warranty to SPSS contained
in this Agreement, and no statement contained in the disclosure schedules to
this Agreement, any certificate, list or other writing furnished to SPSS
pursuant to the provisions hereof, contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
herein or therein not misleading.
3.40 Effect of Certificates. All representations and warranties made
in certificates of Surveycraft and the officers of Surveycraft and/or the
Shareholders delivered hereunder shall be deemed to be additional
representations and warranties of Surveycraft and the Shareholders,
respectively.
3.41 Year 2000 Compliance. Surveycraft's products are designed to be
used prior to, during and after the calendar Year 2000 A.D., and during each
such time period will accurately receive, provide and process date/time data
(including, but not limited to, calculating, comparing and sequencing) from,
into and between the 20th and 21st centuries, including the years 1999 and 2000,
and leap-year calculations and will not malfunction, cease to function, or
provide invalid or incorrect results as a result of date/time data.
3.42 Product Warranties and Liabilities. Neither Surveycraft nor
either Subsidiary has given or made any express or implied warranties with
respect to any products licensed, distributed, offered or sold or services
performed by them, except for the limited warranties stated in standard form
customer contracts, in the forms attached to Schedule 3.42, with modifications
that, in the aggregate, would not have a material adverse effect on business,
prospects or financial condition of Surveycraft or either Subsidiary.
Surveycraft does not have any knowledge of any fact or the occurrence of any
event forming the basis of any present or future claim against Surveycraft or
either Subsidiary, whether or not fully covered by insurance, for liability on
account of products liability or on account of any express or implied product
warranty, except for warranty obligations and product returns in the ordinary
course of business and as set forth in Schedule 3.42.
3.43 Material Misstatements or Omissions. No representation or
warranty by either Surveycraft or the Shareholders in this Agreement nor any
documents, exhibits, certificates or schedules furnished to SPSS pursuant
hereto, contains or will contain any untrue statement of a material fact, or
omits or will omit to state any material fact necessary to make the statements
or facts contained therein not misleading. The copies of all documents furnished
to SPSS hereunder are true and complete copies of the originals thereof in all
material respects.
3.44 Trust Warranties.
3.44.1 Microtab is and will at the Closing Date be the
trustee of the Microtab Unit Trust and holds the Shares and conducts the
business of the Microtab Unit Trust in that capacity.
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3.44.2 The distribution date or vesting day referred to in
the trust deed constituting the Microtab Unit Trust has not arrived or been
appointed and will not arise or be appointed on or prior to the Closing Date.
3.44.3 Microtab in its capacity as trustee of the Microtab
Unit Trust has the power to sell the Shares and to enter into and complete this
Agreement, and all necessary consents and notices in relation to the exercise by
Microtab of such power have been given prior to the date hereof and will not be
revoked on or prior to the Closing Date.
3.44.4 There has been no exercise of any power to vary the
Microtab Unit Trust or any of the provisions of the trust deed constituting the
Microtab Unit Trust and no such power will be exercised prior to the Closing
Date.
3.44.5 Microtab has full right and authority to sell the
Shares free of any restriction whatsoever.
3.44.6 The copy of the trust deed constituting the Microtab
Unit Trust delivered to the Purchaser prior to the date hereof is a true copy.
3.44.7 Subject to 2.44.1 to 2.44.6 above neither Shareholder
is or will at the Closing Date be the trustee of any trust other than in the
case of Microtab Systems Pty Ltd. the Microtab Unit Trust and does not now and
will not at the Closing Date hold any of the Shares in that capacity.
3.45 National Australia Bank Charge.
3.45.1 Other than the National Australia bank fixed and
floating charge ASIC number 439267 created on 3 May 1994 (XXXX Charge"), there
are no other encumbrances affecting any of the Shares or any of the asset and
undertaking of Surveycraft.
3.45.2 In respect of the NAB Charge, all of the property
the subject of that charge was released prior to Closing.
3.45.3 To the extent that the consent of National Australia
Bank Limited is required under the terms of the NAB Charge to the sale of the
Shares, that consent has been obtained and a copy provided to SPSS.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SPSS
SPSS represents and warrants to Surveycraft and the Shareholders as
follows:
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4.1 Organization and Qualification. SPSS is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has the corporate power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby.
4.2 Authority. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by SPSS, and no other corporate proceedings on the part of SPSS are
necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by SPSS and constitutes legal, valid and binding agreements of SPSS.
4.3 Consents and Approvals. Except as set forth on Schedule 4.3, there
is no authorization, consent, order or approval of, or notice to or filing with,
any individual or entity required to be obtained or given in order for SPSS to
consummate the transactions contemplated hereby and fully perform its
obligations hereunder.
4.4 Absence of Conflicts. The execution, delivery and performance by
SPSS of this Agreement and the consummation by SPSS of the transactions
contemplated hereby will not, with or without the giving of notice or the lapse
of time, or both, (i) violate any provision of law, statute, rule or regulation
to which SPSS is or was subject, (ii) violate any order, judgment or decree
which is or was applicable to SPSS or (iii) conflict with, or result in a breach
or default under, any term or condition of the Certificate of Incorporation or
By-Laws of SPSS or any agreement or other instrument to which it is a party or
by it is bound.
4.5 Capitalization. The authorized capital stock of SPSS consists of
50,000,000 shares of Common Stock, of which, as of November 1, 1998,
approximately 9,028,753 shares were issued and outstanding. All the issued and
outstanding shares of Common Stock are validly issued, fully paid and
nonassessable. There are no options, warrants or other rights, agreements or
commitments obligating of SPSS to issue shares of its capital stock except for
stock options to purchase shares of Common Stock pursuant to various SPSS option
plans and agreements and employee rights to purchase Common Stock pursuant to
SPSS' employee stock purchase plans.
4.6 Reports and Financial Statement. SPSS has previously furnished
Surveycraft with true and complete copies of its (i) Annual Report on Form 10-K
for the fiscal year ended December 31, 1997 as filed with the Securities and
Exchange Commission ("SEC"), (ii) its Quarterly Report on Form 10-Q for the
quarter ended March 31, 1998, and (iii) its Quarterly Report on Form 10-Q for
the quarter ended June 30, 1998 as filed with the SEC (collectively the "SPSS
Reports"). The audited and unaudited consolidated financial statements of SPSS
(the "SPSS Financial Statements") included or incorporated by reference into
such SPSS Reports have been prepared in accordance with generally accepted
accounting principles applied in a consistent basis (except as may be indicated
therein or in the notes thereto) and fairly present the financial position of
SPSS and its consolidated subsidiaries, as of the dates thereof, and the results
of their operations and changes in financial position for the periods then ended
subject, in the case of the unaudited financial statements, to normal year-end
adjustments which are not materially adverse.
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4.7 Litigation and Administrative Proceedings. There is no claim,
action, suit, proceeding or investigation in any court or before any
governmental or regulatory authority pending or, to the best knowledge of SPSS,
threatened against or affecting SPSS which seeks to enjoin or obtain damages in
respect of the transactions contemplated hereby.
4.8 Brokers and Finders. SPSS has not employed any broker, finder or
investment banker, or incurred any liability for any brokerage fees, commissions
or finders' fees in connection with this Agreement or the transactions
contemplated by this Agreement.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Business.
(a) Conduct of Business by Surveycraft. During the period from the
date of this Agreement to the Closing Date, Surveycraft shall carry on its
business in the usual, regular and ordinary course in substantially the same
manner as heretofore conducted and, to the extent consistent therewith, use all
reasonable efforts to preserve intact its current business organizations, keep
available the services of its current officers and employees, preserve its
relationships with customers, suppliers, licensors, licensees, distributors and
others having business dealings with it to the end that its goodwill and ongoing
businesses shall be unimpaired at the Closing Date and shall cause Subsidiaries
to do the same. Without limiting the generality of the foregoing, during the
period from the date of this Agreement to the Closing Date, neither Surveycraft
nor either Subsidiary shall:
(i) (x) declare, set aside or pay any dividends on, or make
any other distributions in respect of, any of its capital stock, (y)
split, combine or reclassify any of its capital stock or issue or
authorize the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock or (z) purchase,
redeem or otherwise acquire any shares of capital stock of Surveycraft
or either Subsidiary or any other securities thereof or any rights,
warrants or options to acquire any such shares or other securities;
(ii) issue, deliver, sell, pledge or otherwise encumber any
shares of its capital stock, any other voting securities or any
securities convertible into, or any rights, warrants, or options to
acquire, any such shares, voting securities or convertible securities;
(iii) amend its Memorandum of Association, Articles of
Association or other comparable charter or organizational documents;
(iv) acquire or agree to acquire (x) by merging or
consolidating with, or by purchasing a substantial portion of the
assets of, or by any other manner, any business or any
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corporation, partnership, joint venture, association or other business
organization or division thereof or (y) any assets that individual or
in the aggregate are material to Surveycraft or either Subsidiary,
except purchases of inventory in the ordinary course of business
consistent with past practice;
(v) sell, lease, license, mortgage or otherwise encumber or
subject to any lien or otherwise dispose of any of its properties or
assets, except in the ordinary course of business;
(vi) (x) incur any indebtedness, except for short term
borrowings incurred in the ordinary course of business consistent with
past practice, (y) make any loans, advances or capital contributions
to, or investments in, any other person;
(vii) make or agree to make any equipment leases or any new
capital expenditure or capital expenditures which are individually in
excess of U.S.$5,000 or in the aggregate are in excess of U.S.$10,000;
(viii) make any Tax election that could reasonably be expected
to have a material adverse effect or settle or compromise any income
tax liability;
(ix) pay, discharge, settle or satisfy any claims,
liabilities or obligations (absolute, accrued, asserted or unassorted,
contingent or otherwise), other than the payment, discharge or
satisfaction, in the ordinary course of business consistent with past
practice or in accordance with their terms, of liabilities reflected or
reserved against in, or contemplated by, the most recent Financial
Statements or incurred since the date of such financial statements in
the ordinary course of business consistent with past practice;
(x) except in the ordinary course of business, modify,
amend or terminate any material contract or agreement to which
Surveycraft or either Subsidiary is a party or waive, release or assign
any material rights or claims thereunder;
(xi) knowingly take any action that would prevent SPSS from
making an election under Section 338 of the Code (and any comparable
election under state, local or foreign tax law) with respect to the
acquisition of Surveycraft by SPSS;
(xii) take any action to institute any new severance or
termination pay practices with respect to any directors, officers or
employees of Surveycraft or either Subsidiary or to increase the
benefits payable under its severance or termination pay practices in
effect on the date hereof;
(xiii) adopt or amend, in any material respect, except as may
be required by applicable law or regulation, any collective bargaining,
bonus, profit sharing, compensation, stock option, restricted stock,
pension, retirement, deferred compensation, employment or
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other employee benefit plan, agreement, trust, fund, plan or
arrangement for the benefit or welfare of any directors, officers or
employees; or
(xiv) authorize any of, or commit or agree to take any of, the
foregoing actions.
(b) Negotiations with Others. Neither the Shareholders nor
Surveycraft shall, directly or indirectly, through any officer, director,
employee, representative or agent thereof, solicit or encourage (including by
way of furnishing nonpublic information) or take other action to facilitate any
inquiries or the making of any proposal that constitutes or may reasonably be
expected to lead to an Acquisition Proposal (as defined below) from any person,
or engage in any discussions or negotiations relating thereto or in furtherance
thereof or accept any acquisition proposal. For the purposes of this Agreement,
"Acquisition Proposal" means inquiries or proposals regarding (i) any merger,
consolidation, sale of substantial assets or similar transactions involving
Surveycraft or either Subsidiary, (ii) sale of 10% or more of the issued shares
of capital stock of Surveycraft or any shares of the capital stock of either
Subsidiary or similar transactions involving Surveycraft or either Subsidiary,
or (iii) any public announcement of a proposal, plan or intention to do any of
the foregoing or any agreement to engage in any of the foregoing. Surveycraft
and the Shareholders shall immediately cease and cause to be terminated any
existing discussions or negotiations with any parties conducted prior to the
date of this Agreement with respect to any of the foregoing.
(c) Notification of Certain Matters. Surveycraft and the
Shareholders shall give prompt notice to SPSS, and SPSS shall give prompt notice
to Surveycraft and the Shareholders of: (i) the occurrence or failure to occur,
of any event which such party believes would be likely to cause any of its
representations or warranties contained in this Agreement to be untrue or
inaccurate at any time from the date hereof to the Closing Date and (ii) any
failure of Surveycraft and any of the Shareholders on the one hand or SPSS on
the other hand, as the case may be, or of any officer, director, employee or
agent thereof, to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder; provided, however, that failure
to give such notice shall not constitute a waiver of any defense that may be
validly asserted.
ARTICLE VI
COVENANTS OF SURVEYCRAFT AND THE SHAREHOLDERS
Surveycraft and each of the Shareholders, jointly and severally,
covenant as follows:
6.1 Consents and Approvals. Surveycraft and the Shareholders agree
to use all reasonable efforts to make all registrations, filings and
applications, and give all notices and obtain all governmental and other
consents, approvals, orders, qualifications and waivers necessary for the
consummation of the transactions contemplated by, or the performance by
Surveycraft and the Shareholders of any of their obligations under, this
Agreement, or which may become reasonably necessary or desirable in connection
with any of the foregoing, in each case upon terms and conditions reasonably
satisfactory to SPSS and its counsel.
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6.2 Closing Returns. SPSS will cooperate with the Shareholders to
file, or cause to be prepared and filed, on a timely basis all Returns of
Surveycraft and Subsidiary due after the Closing Date and attributable to
periods ending on or before the Closing Date (the "Pre-Closing Periods"),
including without limitation, any tax returns for the short period ending on the
Closing Date (the "Closing Returns"), which Closing Returns shall include any
income or gains attributable to the Section 338 election. SPSS shall direct the
preparation and filing of the Closing Returns; provided, however, that the
Shareholders shall be responsible for paying any Taxes shown on such Closing
Returns or otherwise attributable to the Pre-Closing Periods in accordance with
Section 12.2(a).
6.3 Access to Information.
(a) Surveycraft and the Shareholders shall allow SPSS to have complete
access at all reasonable times to its officers, employees, agents, properties,
books and records, and shall furnish SPSS all financial, operating and other
data and information as SPSS, through its officers, employees or agents, may
reasonably request.
(b) No investigation pursuant to this Section 6.3 shall affect, add
to or subtract from any representations or warranties or the conditions to the
obligations of the parties hereto to effect the Acquisition.
6.4 338 Election. The Shareholders agree to cooperate with SPSS in
making an election under Section 338 of the Code (and any comparable election
under state, local or foreign tax law) with respect to the acquisition of
Surveycraft by SPSS. The Shareholders will cooperate fully in the making of such
election.
6.5 Correction of Shareholder Records. The Shareholders shall
cooperate with SPSS in making all corrections to the Shareholders' records of
Surveycraft, U.K. with the United Kingdom Registrar of Companies to reflect the
change of name of Microtab Systems Pty Ltd. to Surveycraft Limited as holder of
all of the capital stock of Surveycraft U.K. The Shareholders shall likewise
cooperate with SPSS with respect to reflecting such change in the internal
company records of Surveycraft U.K.
6.6 Further Assurances. The Shareholders shall from time to time,
at the request of SPSS and without further cost or expense to SPSS, execute and
deliver such other documents and take such other actions as shall be reasonably
necessary or appropriate to consummate fully the transactions contemplated
hereby.
ARTICLE VII
COVENANTS OF SPSS
SPSS covenants as follows:
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7.1 Retention of Records. After the Closing Date, SPSS will retain
all of Surveycraft's books and records in accordance with SPSS' policies for
retention of its own books and records, and upon reasonable notice and during
SPSS' regular business hours and at reasonable intervals, will provide the
Shareholders, and their respective agents and representatives designated in
writing, access to such books and records, concerning periods prior to the
Closing Date.
7.2 Consulting Agreement. SPSS shall enter into a consulting
agreement with Xxxxx (the "Consulting Agreement"), substantially in the form
attached hereto as Exhibit A.
7.3 Further Assurances. SPSS shall from time to time execute and
deliver such other documents and take such other actions as shall be reasonably
necessary or appropriate to consummate fully the transactions contemplated
hereby.
ARTICLE VIII
MUTUAL COVENANTS
Each of the parties hereto covenants as follows:
8.1 Confidentiality. Except as otherwise required by law or judicial
or administrative proceedings, including proceedings between the parties with
respect to the transactions contemplated hereby, and then only to the extent
specifically required by such proceedings, and except for public announcements
on the advice of counsel, each of the parties agrees not to (i) disclose any
Confidential Information (defined hereinbelow) of any other party, or the terms
of this Agreement, to any individual or entity (other than its directors,
officers, employees, agents and representatives with a need to know such
Confidential Information in order to consummate the transactions contemplated
hereby and then only if reasonable steps are taken with such parties to preserve
the confidentiality thereof) or (ii) use any Confidential Information for any
purpose other than, with respect to SPSS, operating the acquired business.
"Confidential Information" shall mean any secret or confidential information of
the business of designing and developing software, Surveycraft or SPSS,
including, but not limited to, customer information, financial information,
technical information, details or information concerning contracts, trade
secrets, marketing information or any other data, information or proprietary
information of or relating to the business of designing and developing software,
Surveycraft, SPSS or any affiliate thereof, or their respective products or
services. No obligations shall exist under this Agreement with respect to
Confidential Information that (i) is publicly known at the time of the
disclosure or becomes publicly known through no wrongful act or failure of
Surveycraft, the Shareholders or SPSS, (ii) is disclosed by a third party which
does not have a confidential relationship with either Surveycraft, the
Shareholders or SPSS, and which was rightfully acquired by third party, or (iii)
is legally compelled to be disclosed pursuant to a subpoena, summons, order or
other judicial or governmental process, provided that the parties hereto provide
prompt notice of any such subpoena, summons, order or other judicial or
governmental process to such other parties of the Confidential Information, so
as to allow the parties an opportunity to oppose such process.
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8.2 Consistent Tax Reporting. The parties agree for tax purposes to
report the transactions contemplated by this Agreement, and to treat any
subsequent related transactions or items, in a manner consistent in all respects
with the terms and provisions of this Agreement. Each party shall cooperate with
the other parties as appropriate for all relevant tax purposes relating to the
transactions contemplated by this Agreement.
8.3 Cooperation. The parties agree to cooperate for all other
reasonable purposes after the Closing, including with respect to any audit by
any taxing authority of any of the income tax or other tax returns of
Surveycraft or Subsidiary.
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF SURVEYCRAFT
AND THE SHAREHOLDERS
The obligations of Surveycraft and the Shareholders to consummate the
transactions contemplated hereby is subject to the satisfaction on or prior to
the Closing Date of the following conditions:
9.1 Representations and Warranties. The representations and warranties
of SPSS shall be true and accurate on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
such date.
9.2 Performance. SPSS shall have performed in all material respects
all covenants and agreements required by this Agreement to be performed by them
on or before the Closing Date.
9.3 Filings; Consents: Waiting Periods. All registrations, filings,
applications, notices, transfers, consents, approvals, orders, qualifications,
waivers and other actions listed on Schedule 4.3 hereto or otherwise required of
any persons or governmental authorities or private agencies in connection with
the consummation of the transactions contemplated by and the performance by SPSS
of its obligations under this Agreement shall have been made or obtained and all
applicable waiting periods shall have expired or been terminated.
9.4 No Injunction. At the Closing Date, there shall be no injunction,
restraining order or decree of any nature of any court or governmental body in
effect which restricts or prohibits the consummation of the transactions
contemplated by this Agreement.
ARTICLE X
CONDITIONS TO OBLIGATIONS OF SPSS
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The obligation of SPSS to consummate the transactions contemplated
hereby is subject to the satisfaction on or prior to the Closing Date of the
following conditions:
10.1 Representations and Warranties. The representations and warranties
of Surveycraft and the Shareholders shall be true and accurate on and as of the
Closing Date with the same effect as though such representations and warranties
had been made on and as of such date.
10.2 Performance. Surveycraft and the Shareholders shall have performed
in all material respects all covenants and agreements required by this Agreement
to be performed by them on or before the Closing Date.
10.3 Filings: Consents; Waiting Periods. All registrations, filings,
applications, notices, transfers, consents, approvals, orders, qualifications,
waivers and other actions of any kind listed on Schedule 3.5 hereto or otherwise
required of any persons or governmental authorities or private agencies in
connection with the consummation of the transactions contemplated by, and the
performance by Surveycraft and the Shareholders of their respective obligations
under this Agreement shall have been made or obtained and all applicable waiting
periods shall have expired or been terminated, in each case upon terms and
conditions reasonably satisfactory to SPSS.
10.4 No Litigation. No action, suit or proceeding shall have been
instituted by any person or entity, or threatened by any governmental agency or
body, before a court or governmental body, to restrain or prevent the
consummation of the transactions contemplated by, or the performance by
Surveycraft or the Shareholders of their respective obligations under, this
Agreement or which seeks other relief with respect to any of such transactions
or which could reasonably be expected to have a materially adverse effect on the
businesses, results of operations, assets, financial condition or prospects of
Surveycraft or either Subsidiary. At the Closing Date, there shall be no
injunction, restraining order or decree of any nature of any court or
governmental agency or body in effect which restrains or prohibits the
consummation of the transactions contemplated by this Agreement.
10.5 Consulting Agreement. SPSS shall have received an executed
consulting agreement, substantially in the form attached hereto as Exhibit A,
from Xxxxx.
10.6 Legal Opinion. SPSS shall have received the written opinion, dated
the Closing Date, of Xxxxxx Solicitors, substantially in the form attached
hereto as Exhibit B.
10.7 Due Diligence Investigation. SPSS shall have completed a due
diligence investigation of Surveycraft and Subsidiary, the results of which
shall have been satisfactory to SPSS in its sole discretion.
10.8 Shareholder Approval. This Agreement and the Acquisition shall
have been approved and adopted by the consent of the Shareholders in accordance
with applicable law and the Memorandum of Association and Articles of
Association of Surveycraft.
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10.9 Delivery. At the Closing, the documents referenced in Article XI
shall be delivered to SPSS.
ARTICLE XI
CLOSING DELIVERIES
The following deliveries shall be made at the Closing:
11.1 Stock. The Shareholders shall duly execute and deliver share
transfers and share certificates to SPSS representing all of the Shares and SPSS
shall be responsible for payment of stamp duty thereon.
11.2 Books and Records. Surveycraft shall have caused to be delivered
to SPSS all of Surveycraft's and Subsidiary's books and records, including
without limitation the stock transfer and minute books and financial records.
11.3 Consulting Agreement. Surveycraft shall cause to be delivered to
SPSS, an executed consulting agreement, substantially in the form attached
hereto as Exhibit A, from Xxxxx.
11.4 Legal Opinion. Surveycraft shall cause to be delivered to SPSS the
written legal opinion of Xxxxxx Solicitors, in substantially the form attached
hereto as Exhibit B.
11.5 Consents. Surveycraft shall deliver to SPSS all consents and
approvals required in connection with the performance by Surveycraft of its
obligations under this Agreement and the consummation by Surveycraft and
Subsidiary of the transactions contemplated hereby and thereby.
11.6 Closing Certificates. Surveycraft shall deliver, or cause to be
delivered, to SPSS such closing certificates and documents as SPSS and its
counsel shall reasonably request.
11.7 Charter: Good Standing Certificates. Surveycraft U.S. shall
deliver Articles of Incorporation certified by the Secretary of State of Ohio,
as well as good standing and tax certificates from the Secretary of State of the
State of Ohio. Surveycraft U.K. shall deliver Memorandum of Association and as
filed with the United Kingdom Registrar of Companies.
11.8 Resignations of Surveycraft's Officers and Directors. Surveycraft
and Subsidiary shall have caused to be delivered to SPSS resignations, operative
as of the Closing Date, of all the officers and directors of Surveycraft and
each Subsidiary.
11.9 Performance. The parties hereto shall have performed in all
material respects all covenants and agreements required by this Agreement to be
performed by them on or before the Closing Date.
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11.10 Purchase Price. SPSS shall deliver the Purchase Price as set
forth in Section 1.3 hereof upon receipt of all of the closing deliveries and
satisfaction of all of the closing conditions set forth herein and the execution
and delivery by all of the parties hereto of this Agreement and the other
documents, instruments and certificates contemplated hereby and thereby.
11.11 Further Assurances. Each party shall deliver, or cause to be
delivered, all other documents required to be delivered at the Closing by the
other party and shall take all other actions which the other parties may
reasonably determine necessary or appropriate in order to consummate fully the
transactions contemplated hereby.
ARTICLE XII
SURVIVAL AND INDEMNIFICATION
12.1 Survival of Representations and Warranties: Covenants. All
representations and warranties contained herein or made in writing by any party
in connection herewith shall survive the Closing Date for a period of five (5)
years, regardless of any investigation made by or on behalf of any party, except
for the representations and warranties contained in Section 3.3 and 3.4, which
shall survive indefinitely, and the representations and warranties contained in
Sections 3.11, 3.18, 3.20 and 3.21, or a representation or warranty which shall
prove to be untrue due to the fraud of Surveycraft which in each case shall
survive until the expiration of the applicable statute of limitations with
respect to the subject matter thereof. All covenants contained herein shall
survive until performed fully.
12.2 Indemnification.
(a) The Shareholders agree to indemnify and hold SPSS and their
affiliates and the respective officers, directors, employees, agents and
representatives of each of the foregoing (collectively, the "Representatives")
harmless from and against any and all costs, expenses, losses, claims, damages,
penalties, fines, liabilities and obligations whenever arising or incurred
(including, without limitation, amounts paid in settlement, costs of
investigation and attorneys' fees and expenses) (individually, a "Loss," and
collectively, "Losses") arising out of or relating to (i) any breach of any
representation or warranty made by Surveycraft or the Shareholders and (A) set
forth herein or in any related schedule or (B) set forth in any closing
certificate or other document entered into or delivered by Surveycraft or the
Shareholders in connection with this Agreement; (ii) any breach of any covenant,
obligation or agreement of Surveycraft or the Shareholders contained in this
Agreement, or set forth in any closing certificate or other document entered
into or delivered in connection with this Agreement; (iii) any fraudulent
representation or intentional misrepresentation on the part of Surveycraft or
the Shareholders; (iv) any Taxes asserted against Surveycraft or SPSS or any of
is Subsidiaries or affiliates and arising out of or related to tax periods
ending on or prior to the Closing Date; and (v) the Shareholders' pro rata share
of any Taxes for any period beginning before and ending after the Closing Date.
For purposes of this Subparagraph 11.2(a), in the case of
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any taxable period beginning before and ending after the Closing Date, for
purposes of determining the amount of liability for Taxes attributable to the
portion of the taxable period ending on or before the Closing Date: (A) in the
case of sales, use, payroll or excise Taxes or Taxes based upon or related to
income or gains, such portion of the taxable period shall be deemed to be a
separate taxable year and the Shareholder's liability shall be determined by
taking into account all items of income, gain, loss, deduction or credit on a
basis consistent with that employed in preparing the income tax return of
Surveycraft for the taxable year ending on the Closing Date and the prior years,
and (B) in the case of other Taxes, the Shareholder's liability shall equal a
pro-rata portion of the liability for taxes for the entire taxable period based
on the ratio of the number of days from the beginning of such taxable period
through the Closing Date to the total number of days included in such taxable
period. AIndemnification Payment" shall mean any payment due SPSS hereunder.
(b) Except as otherwise specifically set forth herein, the indemnity
provided in this Agreement shall not commence until the cumulative amount of all
Losses shall exceed Twenty-Five Thousand U.S. Dollars (U.S. $25,000.00) in the
aggregate (the ABasket"); provided, however, that if the Basket is reached, the
indemnity provided for herein shall apply to all Losses, including, without
limitation, the Basket. Notwithstanding the foregoing, the Basket shall not
apply to the indemnities provided in this Agreement for breach of any
non-competition or confidentiality obligation contained herein or in any other
closing document, any failure of title to the Shares, or any fraud, willful
misconduct, gross negligence or criminal action on the part of the Shareholders
or Surveycraft, and shall not apply to any liability under Subparagraph
11.2(a)(iv) or Subparagraph 11.2(a)(v) hereof, and notwithstanding anything
contained or implied in this Agreement, the indemnity obligations set forth
herein above this sentence shall survive the Closing without limitation except
as provided by the applicable statue of limitations (including any extension of
said statue of limitations).
12.3 Indemnification by SPSS. SPSS agrees to indemnify and hold
Surveycraft and its affiliates and the respective officers, directors,
employees, agents and representatives of each of the foregoing harmless from and
against any and all Losses relating to (i) any breach of any representation or
warranty of SPSS set forth herein or in any related schedule, or set forth in
any closing certificate or other document entered into or delivered by SPSS in
connection with this Agreement; (ii) any breach of any covenant, obligation or
agreement of SPSS contained in this Agreement or in any other closing document;
and (iii) any fraudulent representation or intentional misrepresentation on the
part of SPSS, unless the claim or cause of action with respect thereto arises
out of or is related to actions or omissions of Surveycraft or the Shareholders
prior to the Closing Date. For purposes of this Subparagraph 11.2(a), in the
case of any taxable period beginning before and ending after the Closing Date,
for purposes of determining the amount of liability for Taxes attributable to
the portion of the taxable period ending on or before the Closing Date: (A) in
the case of sales, use, payroll or excise Taxes or Taxes based upon or related
to income, such portion of the taxable period shall be deemed to be a separate
taxable year and the Shareholder's liability shall be determined by taking into
account all items of income, gain, loss, deduction or credit on a basis
consistent with that employed in preparing income tax return of Surveycraft for
the taxable year ending on the Closing Date and the prior years, and (B) in the
case of other Taxes, the Shareholder's
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liability shall equal a pro rata portion of the liability for taxes for the
entire taxable period based on the ratio of the number of days from the
beginning of such taxable period through the Closing Date to the total number of
days included in such taxable period.
12.4 Indemnification Procedure. (a) An indemnified party under this
Article XII shall give prompt written notice to the indemnifying party (when and
to the extent that the indemnified party has actual knowledge thereof) of any
condition, event or occurrence or the commencement of any action, suit or
proceeding for which indemnification may be sought (each an AIndemnification
Event"), and through counsel reasonably satisfactory to the indemnified party,
shall assume the defense thereof or other indemnification obligation with
respect thereto; provided, however, that any indemnified party shall be entitled
to participate in any such action, suit or proceeding with counsel of its own
choice but at its own expense; and provided, further, that any indemnified party
shall be entitled to participate in any such action, suit or proceeding with
counsel of its own choice at the expense of the indemnifying party, if, under
applicable canons of ethics, joint representation of the indemnifying party and
the indemnified party presents a conflict of interest.
In any event, if the indemnifying party fails to assume the defense
within a reasonable time, the indemnified party may assume such defense or other
indemnification obligation and the reasonable fees and expenses of its attorneys
will be covered by the indemnity provided for hereunder. No action, suit or
proceeding for which indemnification may be sought shall be compromised or
settled in any manner which might adversely affect the interests of the
indemnifying party without the prior written consent of the indemnifying party
(which shall not be unreasonably withheld); provided, however, that the
indemnified party may settle any claim or cause of action without the
indemnifying party's consent, but in such case the indemnifying party shall not
be required to reimburse the indemnified party for its Losses except and to the
extent that a court of competent jurisdiction finally determines on appeal that
the indemnifying party must indemnify the indemnified party therefor.
Notwithstanding anything in this Section 12.4 to the contrary, the indemnifying
party shall not, without the prior written consent of the indemnified party, (i)
settle or compromise any action, suit or proceeding or consent to the entry of
any judgment which does not include as an unconditional term thereof the
delivery by the claimant or plaintiff to the indemnified party of a written
release from all liability in respect of such action, suit or proceeding or (ii)
settle or compromise any action, suit or proceeding in any manner that may
materially and adversely affect the indemnified party other than as a result of
money damages or other money payments. The indemnifying party shall pay all
expenses, including attorneys' fees, that may be incurred by any indemnified
party in enforcing the indemnity provided for hereunder.
(b) In the case of any proposed or actual assessment of tax liabilities
for which either SPSS or the Representatives is entitled to indemnification from
the Shareholders as provided in Section 12.2(a), SPSS shall give written notice
to the Shareholders as provided in subparagraph (a) hereof and shall contest
such proposed or actual assessment through the administrative review or appeal
procedures available under the relevant tax laws and regulations, provided,
however, that SPSS shall not be required to contest such proposed or actual
assessment unless (i) the Shareholders request such a contest, (ii) such a
contest will not adversely affect the tax position of Surveycraft
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35
and/or either Subsidiary after the Closing Date or SPSS, whether before or after
the Closing Date; and (iii) the Shareholders first provide an opinion of
counsel, reasonably acceptable to SPSS, stating that the Shareholders have a
reasonable basis for their position. SPSS shall keep the Shareholders fully
informed as to the progress of such contest. If at any point prior to the
termination of the administrative review process, the Shareholders notify SPSS
in writing that they are willing to accept a settlement proposed by the IRS,
Australian or United Kingdom tax authority with respect to such proposed or
actual assessment of tax liabilities, SPSS will settle the proposed or actual
tax assessment, and SPSS and the Representatives, as applicable, shall
immediately be entitled to indemnification from the Shareholders. If the
Shareholders never elect to request SPSS to settle and such administrative
review process is unsuccessful at eliminating the proposed tax, SPSS shall be
entitled to pay the tax (and any penalties and interest) and be entitled to
indemnification from the Shareholders; provided, that if within ten (10) days of
receipt from SPSS of notice that it is paying the tax, the Shareholders notify
SPSS of their desire to contest the proposed or assessed tax deficiency in the
courts, the Shareholders shall be entitled to do so provided that (a) if the
proposed or actual tax deficiency is contested in tax court, the Shareholders
shall pay from their own sources any amount of taxes, penalties and interest
determined to be due and (b) if the proposed or actual tax deficiency is
contested by suit for refund in any other court, funds shall be provided to SPSS
shall pay the tax and if the outcome of the contest determines that the tax paid
should be refunded, such refund shall be returned to the Shareholders. Any
contest (whether during the administrative review process or otherwise) shall be
conducted at the sole cost and expense of the Shareholders.
12.5 Offset Against Unpaid Amounts. Without limiting such other rights
as SPSS may have and subject to the survival period of the representation and
warranties contained in Section 12.1, if, prior to the time that any payment of
the Purchase Price is to be delivered, and after the Basket has been reached,
SPSS has learned of a breach of any representation, warranty, covenant or
agreement of the Shareholders or Surveycraft contained in this Agreement, SPSS
in its sole discretion may by written notice deduct from the amount of such
payment otherwise owed an amount equal to the aggregate of (a) the amount
necessary to cure or make it whole for such breach or (b) the amount of losses,
damages and expenses incurred or demonstrably in prospect of being incurred in
connection with or caused by such breach.
12.6 Treatment as Adjustment of Purchase Price. Any indemnity payment
received by a party hereunder shall be treated (so far as possible) as an
adjustment of the Purchase Price. However, in the event that the Internal
Revenue Service or any other taxing authority determines that such indemnity
payment constitutes taxable gain or income to the indemnified party, the
indemnifying party shall increase the amount otherwise required to be paid so
that the indemnified party, receives, on an after-tax basis, an amount equal to
the amount it would have received had the indemnity not resulted in taxable gain
or income.
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36
ARTICLE XIII
TERMINATION, AMENDMENT AND WAIVERS
13.1 Termination. This Agreement may be terminated at any time prior
to the Closing Date, whether before or after approval by the Shareholders:
(a) by mutual consent of the Boards of Directors of the parties
hereto;
(b) by Surveycraft or SPSS if a material breach of any provision of
this Agreement has been committed and such breach is not waived;
(c) by SPSS, if the conditions set forth in Article X hereof shall not
have been complied with or performed in any material respect and such
noncompliance or nonperformance shall not have been cured or eliminated (or by
its nature cannot be cured or eliminated) by Surveycraft on or before December
31, 1998; or
(d) by Surveycraft, if the conditions set forth in Article VIII hereof
shall not have been complied with or performed in any material respect and such
noncompliance or nonperformance shall not have been cured or eliminated (or by
its nature cannot be cured or eliminated) by SPSS or before December 31, 1998;
or
(e) by SPSS or Surveycraft if the Acquisition shall not have
been consummated on or before December 31, 1998 or such later date as the
parties hereto agree in writing.
13.2 Effect of Termination. In the event of termination of this
Agreement as provided above, this Agreement shall hereafter become void and
there shall be no liability or further obligation on the part of Surveycraft,
the Shareholders, SPSS or their respective officers or directors, except as set
forth in Section 8.1 and Section 14.3 and except that nothing herein will
relieve any party from liability for breach of this Agreement.
ARTICLE XIV
MISCELLANEOUS
14.1 Amendment and Modification. Subject to applicable law, this
Agreement may be amended, modified and supplemented by written agreement of the
parties.
14.2 Waiver of Compliance. Any failure of Surveycraft or the
Shareholders on the one hand, or SPSS, on the other, to comply with any
obligation herein may be expressly waived hereunder, but such waiver shall not
operate as a waiver of, or estoppel with respect to, any
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37
subsequent or other failure. Any waiver must be in writing and duly executed by
the appropriate parties.
14.3 Expenses. Whether or not the transactions contemplated by this
Agreement shall be consummated, the parties hereto agree that all fees and
expenses incurred by Surveycraft or the Shareholders, on the one hand, and SPSS
on the other, in connection with this Agreement, and the transactions and other
actions contemplated thereby or taken in connection therewith, shall be borne by
Surveycraft and the Shareholders, and by SPSS, respectively, including, without
limitation, all fees of counsel and accountants.
14.4 Notices. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given when delivered by hand or by facsimile transmission (receipt
confirmed), one day after being sent by recognized overnight courier or delivery
service, freight prepaid, or five days after being mailed, certified or
registered mail, postage prepaid, return receipt requested:
(a) If to Surveycraft or the Shareholders to:
Surveycraft, PTY Ltd.
00 Xxxx Xxxxxx
Xxxxxxxxxxx
Xxxxxxxx 0000
Xxxxxxxxx
Attention: Xxxx Xxxxx
Facsimile No.:x000 0000 0000
with a copy to:
Xxxxxx Solicitors
0 Xxxxxxxx Xxxxxx
Xxx Xxxx
Xxxxxxxx 0000
Xxxxxxxxx
Attention: Xxxxxx Xxxxx
Facsimile No. x000 0000 0000
or to such other person or address as Surveycraft or the Shareholders shall
furnish to SPSS in writing by notice given in the manner set forth in (a) above.
(b) If to SPSS, to:
SPSS Inc.
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38
000 Xxxxx Xxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Hamburg
Facsimile No.: (000) 000-0000
with a copy to:
Xxxx & Xxxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
or to such other person or address as SPSS shall furnish to Surveycraft in
writing by notice given in the manner set forth above.
14.5 Assignment. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but 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,
except by operation of law and except that SPSS may assign its rights and
obligations under this Agreement to any other entity wholly owned by SPSS. If
such assignment shall be made by SPSS, the assignee shall be entitled to all of
the rights and shall assume all of the obligations of SPSS hereunder, provided,
that SPSS shall remain liable for and guarantee the performance of such entity's
obligations under this Agreement.
14.6 Publicity. Neither Surveycraft, the Shareholders nor SPSS shall
make or issue, or cause to be made or issued, any announcement or written
statement concerning this Agreement or the transactions contemplated hereby for
dissemination to the general public, without the prior written consent of the
other parties. This provision shall not apply, however, to any announcement or
written statement required to be made by law, the regulations of any federal or
state governmental agency or any stock exchange, except that the party required
to make such announcement shall, whenever practicable, consult with the other
party concerning the timing and content of such announcement before such
announcement is made.
14.7 Headings. The Article and Section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
14.8 Severability. If any provision of this Agreement shall be
determined to be contrary to law and unenforceable by any court of law, the
remaining provisions shall be severable and enforceable in accordance with their
terms.
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39
14.9 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Illinois, without regard to its
conflicts of law doctrine. The parties hereto expressly submit themselves to the
non-exclusive jurisdictions of the State and Federal Courts of Illinois for the
resolution of any disputes which may arise under or with respect to compliance
with this Agreement.
14.10 Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
14.11 Third Parties. Nothing herein shall be construed to confer upon
or give to any party other than the parties hereto and their successors or
permitted assigns, any rights or remedies under or by reason of this Agreement.
14.12 Shareholders. Any dispute as to any claims under this Agreement
shall be settled by arbitration in Chicago, Illinois by three arbitrators, one
of whom shall be appointed by the Shareholders, one by SPSS and the third of
whom shall be appointed by the first two arbitrators. If either party fails to
appoint an arbitrator within 30 days of a request in writing by the other party
to do so or if the first two arbitrators cannot agree on the appointment of a
third arbitrator within 20 days of their designation, then such arbitrator shall
be appointed by the Chief Judge of the United States District Court for the
District of Illinois. Except as to the selection of arbitrators which shall be
as set forth above, the arbitration shall be conducted promptly and
expeditiously in accordance with the commercial arbitration rules of the
American Arbitration Association so as to enable the arbitrators to render an
award within 90 days of the commencement of the arbitration proceedings. Any
award issued as a result of arbitration shall be final and binding on the
parties, and judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof; provided, however, that any award
issued as a result of arbitration shall be reviewable de novo by a court of
competent jurisdiction for errors of law. The costs of the arbitration and the
arbitrator shall be allocated as provided in the results of the arbitration.
14.13 Entire Agreement. This Agreement, including the Exhibits and
Schedules hereto, sets forth the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein, and supersedes
all prior agreements, covenants, representations or warranties, whether oral or
written, by any party hereto.
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40
IN WITNESS WHEREOF, the parties hereto, have caused this Agreement to
be duly executed, all as of the day and year first written above.
SPSS INC., a Delaware corporation
By:
----------------------------------------
Xxxx Xxxxxx
President and Chief Executive Officer
SURVEYCRAFT PTY LTD., an Australian company
By:
----------------------------------------
Name:
Title:
----------------------------------------
XXXX XXXXXXXX
MICROTAB SYSTEMS PTY LTD. ACN
066095638
By:
----------------------------------------
Name:
Title:
As to Article II only:
XXXXXX SOLICITORS, an Australian partnership,
By:
----------------------------------------
Name:
A Partner
