EXHIBIT (ap)
STOCK AND WARRANT PURCHASE AGREEMENT
BETWEEN
PC QUOTE, INC.
AND
XXXXX XXXX
DECEMBER 29, 1998
TABLE OF CONTENTS
1. Definitions
2. Purchase and Sale of Shares and Warrant
3. Representations and Warranties of Buyer
(a) Buyer's Qualifications
(b) Authorization of Transaction
(c) Noncontravention
(d) Broker's Fees
(e) Investment
4. Representations and Warranties of Seller
(a) Authorization of Transaction
(b) Organization, Qualification, and Corporate Power
(c) Capitalization
(d) Noncontravention
(e) Brokers' Fees
(f) Title to Tangible Assets
(g) Financial Statements
(h) Tax Matters
(i) Real Property
(j) Intellectual Property
(k) Powers of Attorney
(l) Litigation
(m) Employee Benefits
(n) Absence of Certain Changes
(o) Patents, Trade Names, Trademarks, Etc.
(p) Insurance
(q) Environmental Protection
5. Pre-Closing Covenants
(a) General
(b) Notices and Consents
(c) Operation of Business
(d) Full Access
(e) Notice of Developments
6. Post-Closing Covenants
(a) General
(b) Litigation Support
(c) Registration Rights
(d) Negative Covenants
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7. Additional Conditions Precedent
(a) Conditions to Obligation of Buyer
(b) Conditions to Obligation of Sellers
8. Remedies for Breaches of This Agreement
(a) Survival of Representations and Warranties
(b) Indemnification Provisions for Benefit of Buyer
(c) Indemnification Provisions for Benefit of Seller
(d) Matters Involving Third Parties
(e) Determination of Adverse Consequences
9. Termination
(a) Termination of Agreement
(b) Effect of Termination
10. Miscellaneous
(a) Press Releases and Public Announcements
(b) No Third Party Beneficiaries
(c) Entire Agreement
(d) Succession and Assignment
(e) Counterparts
(f) Headings
(g) Notices
(h) Governing Law
(i) Amendments and Waivers
(j) Severability
(k) Expenses
(l) Construction
(m) Incorporation of Exhibits, Annexes, and Schedules
(n) The Closing
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STOCK AND WARRANT PURCHASE AGREEMENT
Agreement entered into as of December 29, 1998, by and between Xxxxx
Xxxx (the "Buyer") and PC Quote, Inc., a Delaware corporation (the "Seller").
Buyer and Seller are referred to collectively herein as the "Parties."
This Agreement contemplates a transaction in which Buyer will purchase
from Seller, and Seller will sell to Buyer, an aggregate of 240,000 shares of
Seller's common stock, par value $0.001 per share (the "Common Stock"), for
an aggregate purchase price of Three Hundred Seventy-five Thousand Dollars
($375,000).
Now, therefore, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties and
covenants herein contained, the Parties agree as follows:
1. DEFINITIONS.
"ACCREDITED INVESTOR" has the meaning set forth in Regulation D
promulgated under the Securities Act.
"ADVERSE CONSEQUENCES" means all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable
amounts paid in settlement, liabilities, obligations, taxes, liens, losses,
expenses and fees, including court costs and reasonable attorneys' fees and
expenses.
"AFFILIATE" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.
"AFFILIATED GROUP" means any affiliated group within the meaning of Code
Section 1504.
"BUYER" has the meaning set forth in the preface above.
"CLOSING DATE" shall mean December 30, 1998 or such other time as the
parties may mutually agree.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONFIDENTIAL INFORMATION" means any information concerning the
businesses and affairs of Seller that is not already generally available to
the public.
"EMPLOYEE BENEFIT PLAN" means any (a) nonqualified deferred compensation
or retirement plan or arrangement which is an Employee Pension Benefit Plan,
(b) qualified defined contribution retirement plan or arrangement which is an
Employee Pension Benefit Plan, (c) qualified defined benefit retirement plan
or arrangement which is an Employee Pension Benefit Plan (including any
Multiemployer Plan), or (d) Employee Welfare Benefit Plan or material fringe
benefit plan or program.
"EMPLOYEE PENSION BENEFIT PLAN" has the meaning set forth in ERISA
Section 3.
"EMPLOYEE WELFARE BENEFIT PLAN" has the meaning set forth in ERISA
Section 3.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"FINANCIAL STATEMENTS" has the meaning set forth in Section 4g below.
"GAAP" means United States generally accepted accounting principles as
in effect from time to time.
"INCOME TAX" means any federal, state, local, or foreign income tax,
including any interest, penalty, or addition thereto, whether disputed or not.
"INCOME TAX RETURN" means any return, declaration, report, claim for
refund, or information return or statement relating to Income Taxes,
including any schedule or attachment thereto.
"INDEMNIFIED PARTY" has the meaning set forth in Section 8 below.
"INDEMNIFYING PARTY" has the meaning set forth in Section 8 below.
"KNOWLEDGE" means actual knowledge without independent investigation.
"MULTIEMPLOYER PLAN" has the meaning set forth in ERISA Section 3(37).
"ORDINARY COURSE OF BUSINESS" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity
and frequency).
"PARTY" has the meaning set forth in the preface above.
"PBGC" means the Pension Benefit Guaranty Corporation.
"PERSON" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, a governmental entity (or any
department, agency, or political subdivision thereof) or any entity similar
to any of the foregoing.
"PURCHASE PRICE" has the meaning set forth in Section 2 below.
"REPORTABLE EVENT" has the meaning set forth in ERISA Section 4043.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"SECURITY INTEREST" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest, other than (a) mechanic's, materialmen's,
and similar liens, (b) liens for taxes not yet due and payable or for taxes
that the taxpayer is contesting in good faith through appropriate
proceedings, (c) purchase money liens and liens securing rental payments
under capital lease arrangements, and (d) other liens arising in the Ordinary
Course of Business and not incurred in connection with the borrowing of money.
"SELLER" has the meaning set forth in the preface above.
"SHARES" means Seller's shares of Common Stock.
"THIRD PARTY CLAIM" has the meaning set forth in Section 8 below.
3. PURCHASE AND SALE OF SHARES AND Warrant
3.1 PURCHASE AND SALE OF SHARES. On the Closing Date, in the manner
set forth in this Section 2, upon the terms set forth in this Agreement,
Seller will sell, transfer and deliver to Buyer, and Buyer will purchase from
Seller, 240,000 Shares for an aggregate purchase price of Three Hundred
Seventy-five Thousand Dollars ($375,000) (the "Purchase Price"), in all cases
free and clear of all interests, liens, charges, encumbrances, equities,
claims, assessments and options of whatever nature.
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(a) On the Closing Date, as a condition precedent to such closing,
Seller shall deliver to Buyer stock certificates representing an aggregate of
240,000 Shares in such names and denominations as buyer shall instruct Seller.
(b) Buyer shall deliver to Seller a certified check or wire transfer in
the amount of $375,000.
2.2 Purchase and Sale of Warrant. Subject to the terms and conditions
of this Agreement, the Company shall issue to Buyer a warrant (the "Warrant")
to purchase 120,000 Shares at an exercise price of $1.875 per Share, which
Warrant shall be substantially in the form attached hereto as EXHIBIT A.
3. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
warrants to Seller that the statements contained in this Section 3 are true,
correct and complete as of the date of this Agreement and will be true,
correct and complete as of the Closing Date (as though made on and as of such
Closing Date as if such Closing Date were substituted for the date of this
Agreement throughout this Section 3).
(a) BUYER'S QUALIFICATIONS. Buyer (a) has such knowledge and
experience in financial and business matters that it is capable of
evaluating the merits and risks of its investment in Seller and (b) has had
the opportunity to ask questions of, and receive answers from, Seller and
its management concerning the terms and conditions of the offering of the
Shares hereunder and to obtain additional information; and (c) is an
Accredited Investor.
(b) AUTHORIZATION OF TRANSACTION. Buyer has full power and authority
to execute and deliver this Agreement and to perform its obligations
hereunder. This Agreement constitutes the valid and legally binding
obligation of Buyer, enforceable in accordance with its terms. Buyer is
not required to give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or governmental agency
in order to consummate the transactions contemplated by this Agreement.
(c) NONCONTRAVENTION. Neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated hereby,
will (A) violate any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge, or other restriction of any
government, governmental agency, or court to which Buyer is subject or (B)
conflict with, result in a breach of, constitute a default under, result in
the acceleration of, create in any party the right to accelerate,
terminate, modify, or cancel, or require any notice under any agreement,
contract, lease, license, instrument, or other arrangement to which Buyer
is a party or by which it is bound or to which any of its assets is
subject.
(d) BROKERS' FEES. Buyer does not have any liability or obligation
to pay any fees or commissions to any broker, finder, or agent with respect
to the transactions contemplated by this Agreement for which Seller could
become liable or obligated.
(e) INVESTMENT. Buyer is acquiring the Shares for investment
purposes and not with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act.
4. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
warrants to Buyer that the statements contained in this Section 4 are true,
correct and complete as of the date of this Agreement and will be true,
correct and complete as of the Closing Date (as though made on and as of such
Closing Date as if such Closing Date were substituted for the date of this
Agreement throughout this Section 4).
(a) AUTHORIZATION OF TRANSACTION. Seller has full corporate power and
authority to execute and deliver this Agreement and the other documents and
instruments to be executed and delivered by Seller pursuant to this Agreement
and the transactions contemplated hereby and to perform its obligations
hereunder and thereunder. This Agreement and the other documents and
instruments to be executed and delivered by Seller
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pursuant to this Agreement and the transactions contemplated hereby
constitute the valid and legally binding obligations of Seller enforceable in
accordance with their respective terms.
(b) ORGANIZATION, QUALIFICATION, AND CORPORATE POWER. Seller is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware. Seller is duly authorized to conduct business
and is in good standing under the laws of each jurisdiction where such
qualification is required, except where the lack of such qualification would
not have a material adverse effect on the condition (financial or otherwise)
of Seller. Seller has full corporate power and authority to carry on the
businesses in which it is engaged and to own and use the properties and
assets owned and used by it. Seller has no subsidiaries.
(c) CAPITALIZATION. The entire authorized capital stock of Seller
consists of 50,000,000 Shares, of which 13,477,462 Shares are issued and
outstanding and no Shares are held in treasury; and 5,000,000 Shares of
undesignated Preferred Stock, of which 19,075 and 28,791 shares designated as
Series A and Series B, respectively, Convertible Preferred Stock are
outstanding. All of the issued and outstanding Shares and Preferred Stock
have been duly authorized, are validly issued, fully paid, and nonassessable.
Except as set forth in Schedule 4(c) hereto, there are no outstanding or
authorized options, warrants, purchase rights, subscription rights,
conversion rights, exchange rights, or other contracts or commitments that
could require Seller to issue, sell, or otherwise cause to become outstanding
any of its capital stock. All such options, warrants, purchase rights,
subscription rights, conversion rights, exchange rights or other contracts or
commitments and the Shares issuable upon exercise thereof have been duly
authorized, and when issued in accordance with their terms will be validly
issued, fully paid and non-assessable. There are no preemptive or first
refusal or similar rights binding on Seller to subscribe for or purchase from
Seller any Shares pursuant to any provisions of law, the Certificate of
Incorporation or By-laws of Seller or by agreement or otherwise. There are
no outstanding or authorized stock appreciation, phantom stock, profit
participation, or similar rights with respect to the Shares.
(d) NONCONTRAVENTION. Except as set forth in Schedule 4(d) hereto, to
the Knowledge of Seller, neither the execution and delivery of this
Agreement, nor consummation of the transactions contemplated hereby, will (i)
violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which Seller is subject or any provision of
the Certificate of Incorporation or By-laws of Seller or (ii) conflict with,
result in breach of, constitute a default under, result in the acceleration
of, create in any party the right to accelerate, terminate, modify, or
cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which Seller is a party or by which
Seller is bound or to which Seller or its assets is subject (or result in the
imposition of any Security Interest upon any of its assets), except where the
violation, conflict, breach, default, acceleration, termination,
modification, cancellation, failure to give notice, or Security Interest
would not have a material adverse effect on the condition (financial or
otherwise) of Seller or on the ability of the Parties to consummate the
transactions contemplated by this Agreement. Except as set forth in Schedule
4(d) hereto, Seller does not need to give any notice to, make any filing
with, or obtain any authorization, consent, or approval of any government or
governmental agency in order for the Parties to consummate the transactions
contemplated by this Agreement, except where the failure to give notice, to
file, or to obtain any authorization, consent, or approval would not have a
material adverse effect on the condition (financial or otherwise) of Seller
or on the ability of the Parties to consummate the transactions contemplated
by this Agreement.
(e) BROKERS' FEES. Seller does not have any liability or obligation to
pay any fees or commissions to any broker, finder, or agent with respect to
the transactions contemplated by this Agreement.
(f) TITLE TO TANGIBLE ASSETS. Seller has good title to, or a valid
leasehold interest in, the tangible assets it uses regularly in the conduct
of its businesses.
(g) FINANCIAL STATEMENTS. Attached hereto are copies of Seller's
annual report on Form 10-K for the year ended December 31, 1997 and its
Quarterly Report on Form 10-Q for each of the quarters ended March 31, 1998,
June 30, 1998 and September 30, 1998. Included in such reports are the
following financial statements (collectively the "Financial Statements"):
(i) audited consolidated balance sheets for the years ending December 31,
1997 and 1996 and statements of income, changes in stockholders' equity, and
cash flow as of and for the years ended December 31, 1997, 1996 and 1995 for
the Company; and (ii) unaudited balance sheets and statements of income,
changes in stockholders' equity, and cash flow as of and
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for the quarters ended March 31, 1998, June 30, 1998 and September 30, 1998
(the "QUARTERLY FINANCIAL STATEMENTS"). The Financial Statements (including
the notes thereto) have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered thereby and present fairly
the financial condition of Seller as of such dates and the results of
operations of Seller for such periods; PROVIDED, HOWEVER, that the Quarterly
Financial Statements are subject to normal year-end adjustments and lack
footnotes and other presentation items.
(h) TAX MATTERS.
(i) Seller has filed all Income Tax Returns that it was required to
file, and has paid all Income Taxes shown thereon as owing, except where
the failure to file Income Tax Returns or to pay Income Taxes would not
have a material adverse effect on the condition (financial or otherwise) of
Seller.
(ii) Seller has not waived any statute of limitations in respect of
Income Taxes or agreed to any extension of time with respect to an Income
Tax assessment or deficiency.
(iii) Seller is not a party to any Income Tax allocation or
sharing agreement.
(i) REAL PROPERTY
Seller does not own any real property.
(j) INTELLECTUAL PROPERTY. Except as set forth in Schedule 4(j), the
Company owns or possesses sufficient legal rights to all patents, trademarks,
service marks, trade names, copyrights, trade secrets, licenses, information
and proprietary rights necessary for its business as now conducted without
any conflict with, or infringement of, the rights of others. The Company has
not received any communication alleging that the Company has violated or, by
conducting its business, would violate any of the patents, trademarks,
service marks, trade names, copyrights, trade secrets or other proprietary
rights of any other person or entity. The Company is not aware that any of
its employees are obligated under any contract (including licenses, covenants
or commitments of any nature) or other agreement, or subject to any judgment,
decree or order of any court or administrative agency, that would interfere
with the use of such employee's best efforts to promote the interest of the
Company or that would conflict with the Company's business. Neither the
execution or delivery of this Agreement, nor the carrying on of the Company's
business as now conducted by the employees of the Company, will, to the
Company's knowledge, conflict with or result in a breach of the terms,
conditions, or provisions of, or constitute a default under, any contract,
covenant or instrument under which any such employee is now obligated. The
Company does not believe it is or will be necessary to use any inventions of
any of its employees (or persons it currently intends to hire) made prior to
their employment by the Company. To the Company's knowledge, its officers
and employees are not making improper use of any confidential information or
trade secrets of others, including those of any former employer.
(k) POWERS OF ATTORNEY. Except as set forth in Schedule 4(k), there
are no outstanding powers of attorney executed on behalf of Seller.
(l) LITIGATION. Schedule 4(l) hereto sets forth each instance in which
Seller (i) is subject to any outstanding injunction, judgment, order, decree,
ruling, or charge or (ii) is a party to any action, suit, proceeding,
hearing, or investigation of, in, or before any court or quasi-judicial or
administrative agency of any federal, state, local, or foreign jurisdiction,
except where the injunction, judgment, order, decree, ruling, action, suit,
proceeding, hearing, or investigation would not have a material adverse
effect on the condition (financial or otherwise), assets, liabilities,
earnings or business of Seller.
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(m) Employee Benefits.
(i) Schedule 4(m) hereto lists each Employee Benefit Plan that is
sponsored, maintained or contributed to or required to be contributed to by
the Seller or by any trade or business, whether or not incorporated (an
"ERISA Affiliate"), that together with the Seller would be deemed a "single
employer" within the meaning of Section 4001(b) of ERISA.
(A) Each such Employee Benefit Plan (and each related trust,
insurance contract, or fund) complies in form and in operation in all
respects with the applicable requirements of ERISA and the Code,
except where the failure to comply would not have a material adverse
effect on the condition (financial or otherwise) of Seller.
(B) All contributions (including all employer contributions and
employee salary reduction contributions) which are due have been paid
to each such Employee Benefit Plan which is an Employee Pension
Benefit Plan.
(C) Each such Employee Benefit Plan which is an Employee Pension
Benefit Plan has received a determination letter from the Internal
Revenue Service to the effect that it meets the requirements of Code
Section 401(a).
(D) Seller has made available to Buyer correct and complete
copies of the plan documents and summary plan descriptions, the most
recent determination letter received from the Internal Revenue
Service, the most recent Form 5500 Annual Report, and all related
trust agreements, insurance contracts, and other funding agreements
which implement each such Employee Benefit Plan.
(E) No such Employee Benefit Plan which is an Employee Pension
Benefit Plan (other than any Multiemployer Plan) has been completely
or partially terminated or been the subject of a Reportable Event as
to which notices would be required to be filed with the PBGC. No
proceeding by the PBGC to terminate any such Employee Pension Benefit
Plan (other than any Multiemployer Plan) has been instituted.
(F) No action, suit, proceeding, hearing, or investigation with
respect to the administration or the investment of the assets of any
such Employee Benefit Plan (other than routine claims for benefits) is
pending, except where the action, suit, proceeding, hearing, or
investigation would not have a material adverse effect on the
condition (financial or otherwise) of Seller.
(G) Neither Seller nor any ERISA Affiliate has incurred any
liability to the PBGC (other than PBGC premium payments) or otherwise
under Title IV of ERISA (including any withdrawal liability) with
respect to any such Employee Benefit Plan which is an Employee Pension
Benefit Plan.
(H) The aggregate withdrawal liability of Seller and any and all
ERISA Affiliates, computed as if a complete withdrawal by Seller and
such ERISA Affiliates had occurred under each Multiemployer Plan on
the date hereof, would not exceed $10,000.
(n) ABSENCE OF CERTAIN CHANGES. With respect to the business of
Seller, except as and to the extent set forth in the Company's reports on
Form 10-Q for the quarters ended March 31, 1998, June 30, 1998 and September
30, 1998, since December 31, 1997, Seller has not:
(i) suffered any material adverse change in its condition (financial
or otherwise), assets, liabilities (absolute, accrued, contingent or
otherwise), business, prospects or operations, or experienced any labor
difficulty, or suffered any casualty loss (whether or not insured);
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(ii) paid, discharged or satisfied any claim, lien, encumbrance or
liability (whether absolute, accrued, contingent or otherwise and whether
due or to become due), other than claims, liens, encumbrances or
liabilities (i) which are reflected or reserved against in the Financial
Statements, and which were paid, discharged or satisfied since the date of
the most recent Financial Statements in the ordinary course of business and
consistent with past practice, or (ii) which were incurred and paid,
discharged or satisfied since the date of the most recent Financial
Statements in the ordinary course of business and consistent with past
practice;
(iii) permitted or allowed any of the properties or assets, real,
principal or mixed, tangible or intangible, of or used by Seller, to be
mortgaged, pledged or subjected to any lien or encumbrance;
(iv) written down or written up the value of any inventory, or written
off as uncollectible any notes or accounts receivable or any portion
thereof, except for write-downs, write-ups and write-offs in the ordinary
course of business consistent with past practice;
(v) cancelled any other debts or claims, or waived any rights of
substantial value, or sold, transferred or otherwise disposed of any of the
properties or assets, real, personal or mixed, tangible or intangible,
except in the ordinary course of business and consistent with past
practice;
(vi) disposed of or permitted to lapse any patent, trademark, assumed
name, service xxxx, trade name or copyright application or license or under
which Seller has any right or license, or disposed of or disclosed to any
person any trade secret, formula, process or know-how of Seller or under
which Seller has any right or license;
(vii) granted any general uniform increase in the compensation of
employees (including, without limitation, any increase or change pursuant
to any bonus, pension, profit-sharing, retirement or other plan or
commitment);
(viii) made any change in any method of accounting or accounting
practice or policy; made any loan or advance (other than advances to
employees in the ordinary course of business or travel and expenses
disbursement in accordance with the past practice, but not in excess of
$10,000 at any one time outstanding) to any person who is an officer,
director or employee of Seller;
(ix) declared or paid any dividend or purchased any of its outstanding
shares of capital stock;
(x) agreed, whether in writing or otherwise, to take any of the
actions set forth in this Section 4(n);
(o) INSURANCE. The Company holds and maintains valid policies covering
such casualties and contingencies and of such types and amounts as is
customary for companies similarly situated. The Company has no reason to
believe that it will not be able to renew its existing insurance coverage as
and when such coverage expires or obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that would
not have a material adverse effect.
(q) ENVIRONMENTAL PROTECTION.
In connection with its business operations, Seller has obtained all
permits, licenses and other authorizations which are required under federal,
state and local laws relating to pollution or protection of the environment,
including laws relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants, or hazardous or toxic materials or
wastes into ambient air, surface water, ground water, or land, or otherwise
relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport, or handling of pollutants, contaminants or
hazardous or toxic materials or wastes; to the best of its knowledge after
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due investigation, Seller is in compliance in all material respects with all
terms and conditions of the required permits, licenses and authorizations,
and is also in compliance in all material respects with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in those laws or contained in
any regulation, code, plan, order, decree, judgment, notice or demand latter
issued, entered, promulgated or approved thereunder. Seller is not aware of,
and has not received notice of, past, present or future events, conditions,
circumstances, activities, practices, incidents, actions or plans which may
interfere with or prevent continued compliance, or which may give rise to any
common law or legal liability, or otherwise form the basis of any claim,
action, suit, proceeding, hearing or investigation, based on or related to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling, or the omission, discharge, release or threatened
release into the environment, of any pollutant, contaminant, or hazardous or
toxic material or waste.
5. PRE-CLOSING COVENANTS. The Parties agree as follows with respect
to the period between the execution of this Agreement and the Closing Date or
(ii) termination of this Agreement.
(a) GENERAL. Each of the Parties will use his or its reasonable best
efforts to take any action and to do all things reasonably necessary in order
to consummate and make effective the transactions contemplated by this
Agreement (including satisfaction, but not waiver, of the conditions
precedent to closing.
(b) NOTICES AND CONSENTS. Each party will give any notices to third
parties, and will use its reasonable best efforts to obtain any third party
consents, that Buyer reasonably may request in connection with the matters
referred to in Sections 3 and 4 above.
(c) OPERATION OF BUSINESS. Except for transactions contemplated
hereby, Seller will not engage in, take any action, or enter into any
transaction outside the Ordinary Course of Business.
(d) FULL ACCESS. Seller will permit representatives of Buyer to have
full access at all reasonable times, and in a manner so as not to interfere
with the normal business operations of Seller, to all premises, properties,
personnel, books, records (including tax records), contracts, and documents
of or pertaining to Seller. Buyer will treat and hold as such any
Confidential Information received from Seller in the course of the reviews
contemplated by this Section 5(d), will not use any of the Confidential
Information except in connection with this Agreement, and, if this Agreement
is terminated for any reason whatsoever, will return to Seller all tangible
embodiments (and all copies) of the Confidential Information which are in its
possession.
(e) NOTICE OF DEVELOPMENTS. Seller shall notify Buyer of any
development causing a breach of any of the representations and warranties in
Section 4 above. Unless Buyer have the right to terminate this Agreement
pursuant to Section 9(a)(ii) below by reason of the development and exercise
that right within the period referred to in Section 9(a)(ii) below, the
written notice pursuant to this Section 5(e)(i) will be deemed to have
amended the relevant Schedule, if any, to have qualified the representations
and warranties contained in Section 4 above, and to have cured any
misrepresentation or breach of warranty that otherwise might have existed
hereunder by reason of the development.
6. POST-CLOSING COVENANTS. The Parties agree as follows with respect
to the period following the Closing.
(a) GENERAL. In case at any time after any Closing Date any further
action is necessary to carry out the purposes of this Agreement, each of the
Parties will take such further action (including the execution and delivery
of such further instruments and documents) as any other Party reasonably may
request, all at the sole cost and expense of the requesting party (unless the
requesting Party is entitled to indemnification therefor under Section 8
below).
(b) LITIGATION SUPPORT. In the event and for so long as any Party
actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection
with (i) any transaction contemplated under this Agreement or (ii) any fact,
situation, circumstance, status,
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condition, activity, practice, plan, occurrence, event, incident, action,
failure to act, or transaction on or prior to any Closing Date involving
Seller, each of the other Parties shall cooperate with him or it and his or
its counsel in the defense or contest, make available their personnel, and
provide such testimony and access to their books and records as shall be
necessary in connection with the defense or contest (unless the contesting or
defending Party is entitled to indemnification therefor under Section 8
below).
(c) REGISTRATION RIGHTS. Buyer shall be afforded such registration
rights as are set forth in the Registration Rights Agreement, substantially
in the form attached hereto as EXHIBIT B.
(d) NEGATIVE COVENANTS. Seller covenants and agrees that, until the
Closing Date, Seller will not do any of the following without the prior
written consent of Buyer, which shall not be unreasonably withheld:
(i) DISPOSITIONS. Convey, sell, lease, transfer or otherwise dispose
of (each of the foregoing, a "Transfer"), all or any part of its business
or property, other than: (i) Transfers of non-exclusive licenses and
similar arrangements for the use of Seller's services; or (ii) Transfers of
worn-out or obsolete equipment.
(ii) MERGERS OR ACQUISITIONS. Merge or consolidate with or into any
other business organization, or acquire all or substantially all of the
capital stock or property of another Person.
(iii) DISTRIBUTIONS. Pay any dividends or make any other
distribution or payment on account of or in redemption, retirement or
purchase of any capital stock except with respect to any obligations in
existence as of the date hereof and set forth on Schedule 6(h) hereto.
(iv) TRANSACTIONS WITH AFFILIATES. Directly or indirectly enter into
or permit to exist any material transaction with any Affiliate of Seller
except for transactions involving agreements that are in place at the date
hereof or that are in the ordinary course of Seller's business, upon fair
and reasonable terms that are no less favorable to Seller than would be
obtained in an arm's length transaction with a nonaffiliated Person.
7. ADDITIONAL CONDITIONS PRECEDENT.
(a) CONDITIONS TO OBLIGATION OF BUYER. The obligation of Buyer to
consummate the transactions contemplated by this Agreement is subject to
satisfaction of the following conditions:
(i) the representations and warranties of Seller set forth in Section
4 above shall be true and correct in all material respects at and as of the
Closing Date;
(ii) Seller shall have performed and complied with all of its
covenants hereunder in all material respects through the Closing Date ;
(iii) there shall not be any injunction, judgment, order, or
decree enjoining the transactions contemplated by this Agreement;
(iv) all actions to be taken by Seller in connection with consummation
of the transactions contemplated hereby and all certificates, opinions,
instruments, and other documents required to effect the transactions
contemplated hereby will be satisfactory in form and substance to Buyer.
Buyer may waive any condition specified in this Section 7(a) upon execution
of a writing so stating at or prior to the Closing Date.
(b) CONDITIONS TO OBLIGATION OF SELLER. The obligation of Seller to
consummate the transactions contemplated by this Agreement is subject to
satisfaction of the following conditions:
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(i) the representations and warranties of Buyer set forth in Section
3 above shall be true and correct in all material respects at and as of the
Closing Date;
(ii) Buyer shall have performed and complied with all of its covenants
hereunder in all material respects through the Closing Date;
(iii) there shall not be any injunction, judgment, order, decree,
ruling, or charge in effect preventing consummation of any of the
transactions contemplated by this Agreement;
(iv) all actions to be taken by Buyer in connection with consummation
of the transactions contemplated hereby and all certificates, opinions,
instruments, and other documents required to effect the transactions
contemplated hereby will be reasonably satisfactory in form and substance
to Seller.
Seller may waive any condition specified in this Section 7(b) if it executes
a writing so stating at or prior to the Closing Date.
8. REMEDIES FOR BREACHES OF THIS AGREEMENT.
(a) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties of Buyer and Seller contained in Section 3 and
Section 4, respectively above, shall survive this Agreement and continue in
full force and effect for a period of one year thereafter.
(b) INDEMNIFICATION PROVISIONS FOR BENEFIT OF BUYER. In the event
Seller breaches any of its representations, warranties, or covenants
contained herein, it shall so notify Buyer and provided that Buyer makes a
written claim for indemnification against Seller pursuant to Section 10 below
within such survival period, then Seller agrees to indemnify Buyer from and
against the entirety of any Adverse Consequences Buyer shall suffer through
and after the date of the claim for indemnification caused by the breach.
(c) INDEMNIFICATION PROVISIONS FOR BENEFIT OF SELLER. In the event
Buyer breaches any of its representations, warranties, or covenants contained
herein, it shall so notify Seller and provided that Seller makes a written
claim for indemnification against Buyer pursuant to Section 10 below within
such survival period, then buyer agrees to indemnify Seller from and against
the entirety of any Adverse Consequences Seller shall suffer through and
after the date of the claim for indemnification caused by the breach.
(d) MATTERS INVOLVING THIRD PARTIES.
(i) If any third party shall notify any Party (the "INDEMNIFIED
PARTY") with respect to any matter (a "THIRD PARTY CLAIM") which may give
rise to a claim for indemnification against any other Party (the
"INDEMNIFYING PARTY") under this Section 8, then the Indemnified Party
shall promptly (and in any event within [five business days] after
receiving notice of the Third Party Claim) notify each Indemnifying Party
thereof in writing.
(ii) Any Indemnifying Party will have the right to assume and
thereafter conduct the defense of the Third Party Claim with counsel of his
or its choice reasonably satisfactory to the Indemnified Party; provided,
HOWEVER, that the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third Party Claim
without the prior written consent of the Indemnified Party (not to be
withheld unreasonably) unless the judgment or proposed settlement involves
only the payment of money damages and does not impose an injunction or
other equitable relief upon the Indemnified Party.
(iii) Unless and until an Indemnifying Party assumes the defense
of the Third Party Claim as provided in Section 8(c)(ii) above, however,
the Indemnified Party may defend against the Third Party Claim in any
manner he or it reasonably may deem appropriate.
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(iv) In no event will the Indemnified Party consent to the entry of
any judgment or enter into any settlement with respect to the Third Party
Claim without the prior written consent of each of the Indemnifying
Parties, not to be unreasonably withheld.
(e) DETERMINATION OF ADVERSE CONSEQUENCES. The Parties shall make
appropriate adjustments for tax benefits and insurance coverage in
determining Adverse Consequences for purposes of this Section 8. All
indemnification payments under this Section 8 shall be deemed adjustments to
the Purchase Price.
9. TERMINATION.
(a) TERMINATION OF AGREEMENT. The Parties may terminate this Agreement as
provided below
(i) Buyer and Seller may terminate this Agreement by mutual written
consent at any time prior to the Closing Date;
(ii) Buyer may terminate this Agreement by giving written notice to
Seller at any time prior to the Closing Date in the event (A) Seller has
given Buyer any notice pursuant to Section 5(e) above and (B) the
development that is the subject of the notice has had, or reasonably
believes will have, a material adverse effect upon the condition (financial
or otherwise) of Seller;
(iii) Buyer may terminate this Agreement by giving written notice
to Seller at any time prior to the Closing Date (A) in the event Seller has
breached any material representation, warranty, or covenant contained in
this Agreement in any material respect, Buyer have notified Seller of the
breach, and the breach has continued without cure for a period of 10 days
after the notice of breach or (B) if the Closing shall not have occurred on
or before December 30, 1998, by reason of the failure of any condition
precedent Section 7 hereof (unless the failure results primarily from any
breach by Buyer of any material representation, warranty, or covenant
contained in this Agreement); and
(iv) Seller may terminate this Agreement by giving written notice to
Buyer at any time prior to the Closing Date (A) in the event either Buyer
has breached any material representation, warranty, or covenant contained
in this Agreement in any material respect, Seller has notified each Buyer
of the breach, and the breach has continued without cure for a period of 10
days after the notice of breach or (B) if the Closing shall not have
occurred on or before December 30, 1998, by reason of the failure of any
condition precedent Section 7 hereof (unless the failure results primarily
from Seller breaching any material representation, warranty, or covenant
contained in this Agreement).
(b) EFFECT OF TERMINATION. If any Party terminates this Agreement pursuant
to Section 9(a) above, all rights and obligations of the Parties hereunder shall
terminate without any liability of any Party to any other Party (except for any
liability of any Party then in breach); PROVIDED, HOWEVER, that the
confidentiality provisions contained in Section 5(d) above shall survive
termination.
10. MISCELLANEOUS.
(a) PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. No Party shall issue any
press release or make any public announcement relating to the subject matter
of this Agreement prior to the Closing Date, without the prior written
approval of Buyer and Seller; PROVIDED, HOWEVER, that any Party may make any
public disclosure it believes in good faith is required by applicable law or
any listing or trading agreement concerning its publicly-traded securities
(in which case the disclosing Party will use its reasonable best efforts to
advise the other Parties prior to making the disclosure).
(b) NO THIRD PARTY BENEFICIARIES. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns.
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(c) ENTIRE AGREEMENT. This Agreement (including the documents referred
to herein) constitutes the entire agreement among the Parties and supersedes
any prior understandings, agreements, or representations by or among the
Parties, written or oral, to the extent they have related in any way to the
subject matter hereof.
(d) SUCCESSION AND ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective
successors and permitted assigns. No Party may assign either this Agreement
or any of his or its rights, interests, or obligations hereunder without the
prior written approval of the other.
(e) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(f) HEADINGS. The 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.
(g) NOTICES. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if (and
then two business days after) it is sent by registered or certified mail,
return receipt requested, postage prepaid, and addressed to the intended
recipient as set forth below:
If to Seller:
P.C. Quote, Inc.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxxxx
If to Buyer:
Xxxxx Xxxx
0000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Any Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail, or electronic mail), but no such
notice, request, demand, claim, or other communication shall be deemed to
have been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Parties notice in the manner herein set forth.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving
effect to any choice or conflict of law provision or rule (whether of the
State of or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Delaware.
(i) AMENDMENTS AND WAIVERS. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by
the Parties. No waiver by any Party of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, shall
be deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence.
(j) SEVERABILITY. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
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hereof or the validity or enforceability of the offending term or provision
in any other situation or in any other jurisdiction.
(k) EXPENSES. Each Party bears its own costs and expenses (including
legal fees and expenses) incurred in connection with this Agreement and the
transactions contemplated hereby.
(l) CONSTRUCTION. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the Parties and no presumption or burden
of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any of the provisions of this Agreement. Any reference to any
federal, state, local, or foreign statute or law shall be deemed also to
refer to all rules and regulations promulgated thereunder, unless the context
requires otherwise. The word "including" shall mean including without
limitation.
(m) INCORPORATION OF EXHIBITS, ANNEXES, AND SCHEDULES. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference
and made a part hereof.
(n) THE CLOSING. The closing of the transactions contemplated by this
Agreement shall take place at the offices of the Company in Chicago,
Illinois, commencing at 3:00 p.m. local time on the Closing Date or on such
other time, date and location mutually agreed by the Parties.
* * * * *
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first above written.
PC QUOTE, INC.
By: __________________________ By: _____________________________
Name: Xxxx X. Xxxxx Name: Xxxxx Xxxx
Title: Chief Financial Officer
Seller Buyer
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