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STOCK PURCHASE AGREEMENT
among
THOMSON U.S. HOLDINGS INC.
SCS SUBSIDIARY, INC.
and
XXXXXX X. XXXXX, XX.
Dated as of December 19, 1995
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TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . 1
1.02 Adjustments upon Changes in Capitalization. . . . . . . . . . 3
ARTICLE II
PURCHASE AND SALE
2.01 Purchase and Sale . . . . . . . . . . . . . . . . . . . . . . 4
2.02 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.03 Closing Deliveries by Seller. . . . . . . . . . . . . . . . . 4
2.04 Closing Deliveries by the Purchaser . . . . . . . . . . . . . 5
ARTICLE III
REPRESENTATIONS AND
WARRANTIES OF SELLER AS TO THE COMPANY
3.01 Title to Stock. . . . . . . . . . . . . . . . . . . . . . . . 5
3.02 Authority Relative to this Agreement. . . . . . . . . . . . . 5
3.03 No Conflict; Required Filings and Consents. . . . . . . . . . 6
3.04 Compliance. . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.05 Absence of Litigation . . . . . . . . . . . . . . . . . . . . 6
3.06 No Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.07 Merger Agreement. . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND THE PURCHASER
4.01 Corporate Organization. . . . . . . . . . . . . . . . . . . . 7
4.02 Authority Relative to this Agreement. . . . . . . . . . . . . 7
4.03 No Conflict; Required Filings and Consents. . . . . . . . . . 7
4.04 Investment Intent . . . . . . . . . . . . . . . . . . . . . . 8
4.05 Absence of Litigation . . . . . . . . . . . . . . . . . . . . 8
4.06 No Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . 8
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ARTICLE V
COVENANTS
5.01 Irrevocable Proxy . . . . . . . . . . . . . . . . . . . . . . 9
5.02 Merger Agreement. . . . . . . . . . . . . . . . . . . . . . . 9
5.03 Standstill, Etc.. . . . . . . . . . . . . . . . . . . . . . . 9
5.04 No Solicitation . . . . . . . . . . . . . . . . . . . . . . . 9
5.05 Filings; Consents . . . . . . . . . . . . . . . . . . . . . . 10
5.06 Public Announcements. . . . . . . . . . . . . . . . . . . . . 10
5.07 Sales and Transfer Taxes. . . . . . . . . . . . . . . . . . . 10
5.08 Guaranty by Parent. . . . . . . . . . . . . . . . . . . . . . 11
5.09 Waiver of Appraisal Rights. . . . . . . . . . . . . . . . . . 11
5.10 Further Assurances. . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE VI
CONDITIONS TO CLOSING
6.01 Conditions to the Obligations of Seller . . . . . . . . . . . 11
6.02 Conditions to Obligations of Parent and the Purchaser . . . . 12
ARTICLE VII
INDEMNIFICATION
7.01 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.02 Indemnification . . . . . . . . . . . . . . . . . . . . . . . 13
7.03 Limitations on Indemnification. . . . . . . . . . . . . . . . 15
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.01 Termination . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.02 Effect of Termination . . . . . . . . . . . . . . . . . . . . 16
8.03 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . 17
8.04 Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE IX
MISCELLANEOUS
9.01 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.02 Assignment. . . . . . . . . . . . . . . . . . . . . . . . . . 18
9.03 Entire Agreement; Headings. . . . . . . . . . . . . . . . . . 18
9.04 Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . 18
9.05 Equitable Relief; Preservation of Remedies. . . . . . . . . . 19
9.06 No Third-Party Beneficiaries. . . . . . . . . . . . . . . . . 19
9.07 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . 19
9.08 Severability. . . . . . . . . . . . . . . . . . . . . . . . . 19
9.09 Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . 19
9.10 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . 20
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STOCK PURCHASE AGREEMENT (the "Agreement") dated as of December 19,
1995, among XXXXXX X. XXXXX, XX. ("Seller"), THOMSON U.S. HOLDINGS INC.
("Parent"), a Delaware corporation, and SCS SUBSIDIARY, INC., a Delaware
corporation (the "Purchaser").
WHEREAS, concurrently with the execution and delivery of this
Agreement, Parent, the Purchaser and SCS/Compute, Inc., a Delaware corporation
(the "Company") are entering into an Agreement and Plan of Merger (the "Merger
Agreement") which provides, upon the terms and subject to the conditions
thereof, for the acquisition of the Company by Parent through a cash tender
offer by Purchaser (the "Offer") for all outstanding shares of Common Stock, par
value $.10 per share (the "Common Stock") at a price of $ 6.75 per share net to
the seller in cash, and, subsequent to consummation of the Offer and the
transactions contemplated by this Agreement, the merger of Purchaser with and
into the Company (the "Merger"), pursuant to which each issued and outstanding
share of Company Common Stock not owned directly or indirectly by Parent,
Purchaser or the Company will be converted into the right to receive the price
per share paid in the Offer (the "Offer Price") in cash; and
WHEREAS, the Seller acknowledges and agrees that he has executed and
delivered this Agreement in order to induce Parent and Purchaser to enter into
the Merger Agreement;
WHEREAS, Seller is the beneficial and of record owner of 1,082,570
shares of Common Stock (the "Shares"); and
WHEREAS, Stockholder desires to sell to the Purchaser and the Purchaser
desires to purchase from Seller, the Shares;
NOW, THEREFORE, in consideration of the premises and the covenants,
agreements, representations and warranties herein contained, the parties agree
as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
(a) "Agreement" has the meaning set forth in the preamble.
(b) "Claims Notice" has the meaning set forth in Section 7.02(c).
(c) "Closing" has the meaning set forth in Section 2.02.
(d) "Closing Date" has the meaning set forth in Section 2.02.
(e) "Common Stock" has the meaning set forth in the recitals.
(f) "Company" has the meaning set forth in the recitals.
(g) "Department of Justice" means the Antitrust Division of the United
States Department of Justice.
(h) "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
(i) "FTC" means the Federal Trade Commission.
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(j) "HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.
(k) "Indemnified Person" has the meaning set forth in Section 7.02(c).
(l) "Indemnifying Party" has the meaning set forth in Section 7.02(c).
(m) "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.
(n) "Lien" means any security interest, lien (including tax lien),
pledge, claim (other than a pending lawsuit), charge, escrow, encumbrance,
option, forfeiture, penalty, restriction, right of first refusal, action in
law or equity, community property right or other marital right, mortgage,
security agreement, voting trust, transfer restriction under any
shareholder agreement or similar agreement, arrangement, contract,
commitment, understanding or obligation, whether or not relating in any way
to credit or the borrowing of money.
(o) "Loss" means any expense (including reasonable attorneys' fees and
disbursements), fine, penalty, loss, claim, damage, liability, suit,
deficiency, judgment or amount paid in settlement, including, without
limitation, any thereof in connection with any threatened, pending or
completed claim, dispute, suit, proceeding or investigation (whether civil,
criminal, administrative, investigative or otherwise).
(p) "Material Adverse Effect", when used in connection with any party
to this Agreement, means any change or effect that, when taken together
with all other adverse changes and effects that are within the scope of the
representations and warranties made by such party in this Agreement is, or
is reasonably likely to be materially adverse to the business, operations,
properties, condition (financial or otherwise), assets or liabilities
(including, without limitation, contingent liabilities) or prospects of
that party.
(q) "Merger Agreement" has the meaning set forth in the recitals.
(r) "Offer" has the meaning set forth in the preamble.
(s) "Parent" has the meaning set forth in the preamble.
(t) "Person" means any corporation, partnership, person or other entity
or group.
(u) "Purchaser" has the meaning set forth in the preamble.
(v) "SEC" means the Securities and Exchange Commission.
(w) "Seller" has the meaning set forth in the preamble.
(x) "Shares" has the meaning set forth in the recitals.
(y) "Tax" or "Taxes" means all income, gross receipts, sales, ad
valorem, use, employment, franchise, profits, environmental, recording,
property, excise, gains or other taxes, fees, stamp taxes and duties,
assessments or charges of any kind whatsoever (whether payable directly or
by withholding), together with any interest and any penalties, additions to
tax or additional amounts imposed by any taxing authority with respect
thereto.
(z) "1934 Act" means the Securities Exchange Act of 1934, as amended.
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(aa) "1933 Act" means the Securities Act of 1933, as amended.
(bb) "Transactions" means all of the transactions provided for under
this Agreement.
SECTION 1.02 Adjustments upon Changes in Capitalization. For all
purposes of this Agreement, "the Shares" shall mean and include a share of
Common Stock in the form existing on the date hereof and all securities or
property (excluding regular quarterly cash dividends) issued or exchanged with
respect thereto from and after the date of this Agreement upon any
reorganization, recapitalization, reclassification, merger, consolidation,
spin-off, partial or complete liquidation, stock dividend, split-up, sale of
assets, distribution to stockholders or combination of the Company's capital
stock or any other similar change in its capital structure. In the event of any
such change in the number of shares of Common Shares, the number and kind of
Shares shall be appropriately adjusted to restore to the Purchaser its rights
and privileges hereunder. The rights of Purchaser under this Section 1.02 shall
be in addition to, and shall in no way limit, its rights against the Company for
breach by the Company of the Merger Agreement.
ARTICLE II
PURCHASE AND SALE
SECTION 2.01 Purchase and Sale. Upon the terms and subject to the
conditions set forth in this Agreement, Seller agrees to sell and deliver to the
Purchaser, and the Purchaser agrees to purchase from Seller, the Shares. The
purchase price for each of the Shares shall be equal to $ 6.75 (or, if higher,
the highest price paid for any share of Company Common Stock by Parent or any of
its Affiliates pursuant to the Offer).
SECTION 2.02 Closing. Subject to the terms and conditions of this
Agreement, the sales and purchases of the Shares contemplated hereby will take
place at a closing (the "Closing") at the offices of Shearman & Sterling, 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 A.M., New York City time, on
January 31, 1996, or at such other time or on such other date as to which the
parties may agree. The time and date upon which the Closing occurs are herein
called the "Closing Date". The parties hereto agree that in the event that the
Purchaser shall purchase Common Stock pursuant to the Offer, the Closing shall
take place, subject to the terms and conditions hereof, immediately after the
expiration of the Offer.
SECTION 2.03 Closing Deliveries by Seller. At the Closing, Seller will
deliver or cause to be delivered to the Purchaser:
(a) stock certificates evidencing the Shares, duly endorsed in blank or
accompanied by stock powers duly executed in blank, in form satisfactory to
the Purchaser and with all required stock transfer tax stamps affixed; and
(b) a certificate signed by Seller stating that, (i) the
representations and warranties of Seller contained in this Agreement are
true and correct in all material respects as of the Closing, with the same
force and effect as if made as of the Closing and (ii) the covenants and
agreements contained in this Agreement to be complied with by Seller at or
prior to the Closing shall have been complied with.
SECTION 2.04 Closing Deliveries by the Purchaser. At the Closing, the
Purchaser will deliver or cause to be delivered to Seller:
(a) the aggregate purchase price payable pursuant to Section 2.01, by
check or wire transfer, in immediately available funds; and
(b) a certificate of the Purchaser signed by a duly authorized officer
of the Purchaser stating that (i) the representations and warranties of the
Purchaser contained
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in this Agreement shall be true and correct in all material respects as of the
Closing, with the same force and effect as if made as of the Closing except
where the failure to be so true and correct would not have a material adverse
effect of the ability of the Purchaser to consummate the transactions
contemplated by this Agreement (the "Transactions"), and (ii) the covenants and
agreements contained in this Agreement to be complied with by the Purchaser at
or prior to the Closing shall have been complied with in all material respects
except where the failure to so comply would not have a material adverse effect
on the ability of the Purchaser to consummate the Transactions.
ARTICLE III
REPRESENTATIONS AND
WARRANTIES OF SELLER AS TO THE COMPANY
Seller represents and warrants to Parent and the Purchaser as follows:
SECTION 3.01 Title to Stock. Except as set forth on Schedule 3.01,
Seller is the lawful owner (both beneficially and of record) of the Shares and
Seller has good and valid title to such Shares. At the Closing, Seller will be
the lawful owner (both beneficially and of record) of the Shares and will have
good and valid title to such Shares and will have the right, power and capacity
to sell, assign, transfer and deliver the same to the Purchaser pursuant to this
Agreement, free and clear of all Liens. Upon delivery of the Shares to the
Purchaser as provided in Article II, the Purchaser will have good and valid
title to and ownership of the Shares, free and clear of all Liens, and such
capital stock will be fully paid and nonassessable.
SECTION 3.02 Authority Relative to this Agreement. Seller has the full
right, capacity and power to execute and deliver this Agreement, to perform his
obligations hereunder and to consummate the Transactions. This Agreement has
been duly and validly executed and delivered by Seller and, assuming the due
authorization, execution and delivery by Parent and the Purchaser, constitutes a
legal, valid and binding obligation of Seller enforceable against Seller in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally (including, without limitation, the effect of
statutory and other law regarding fraudulent conveyances, fraudulent transfers
and preferential transfers), as may be limited by the exercise of judicial
discretion and the application of principles of equity including, without
limitation, requirements of good faith, fair dealing, conscionability and
materiality (regardless of whether considered in a proceeding in equity or at
law) and that the remedy of specific performance and injunctive and other forms
of equitable relief may be subject to equitable defenses and to the discretion
of the Court before which any proceeding therefor may be brought.
SECTION 3.03 No Conflict; Required Filings and Consents. (a) The
execution and delivery of this Agreement by Seller do not, and the performance
of this Agreement by Seller will not, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to Seller.
(b) The execution and delivery of the Agreement by Seller do not, and
the performance of this Agreement by Seller will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, domestic or foreign, except for (i) filing
the pre-merger notification and report forms with respect to the transactions
contemplated by this Agreement under the HSR Act, (ii) filings required to be
made with the SEC pursuant to the rules and regulations of the 1934 Act and
applicable state takeover laws, or (iii) filings with the Nasdaq Small Cap
Market or the National Association of Securities Dealers, Inc.
SECTION 3.04 Compliance. Seller is not in default or violation of, any
law, rule, regulation, order, judgment or decree applicable to Seller that would
materially impair the ability or obligation of Seller to perform fully on a
timely basis his obligations under this
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Agreement.
SECTION 3.05 Absence of Litigation. There is no claim, action,
proceeding or investigation pending or, to the best knowledge of Seller,
threatened against, relating to or affecting Seller, the Company, or any of
their respective properties or rights, before any court, arbitrator or
administrative, governmental or regulatory authority or body, domestic or
foreign that, if determined adversely to Seller or the Company, would materially
impair the ability or obligation of Seller to perform fully on a timely basis
his obligations under this Agreement.
SECTION 3.06 No Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based on arrangements made
by and on behalf of Seller.
SECTION 3.07 Merger Agreement. All the representations and warranties
set forth in Article III of the Merger Agreement are true, complete and correct.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND THE PURCHASER
Parent and the Purchaser, jointly and severally, represent and warrant
to Seller as follows:
SECTION 4.01 Corporate Organization. Each of Parent and the Purchaser
is a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization.
SECTION 4.02 Authority Relative to this Agreement. Each of Parent and
the Purchaser has all necessary corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the Transactions. The execution and delivery of this Agreement by Parent and the
Purchaser and the consummation by Parent and the Purchaser of the Transactions
have been duly and validly authorized by all necessary corporate action on the
part of Parent and the Purchaser and no other corporate proceedings on the part
of Parent or the Purchaser are necessary to authorize this Agreement or to
consummate the Transactions. This Agreement has been duly and validly executed
and delivered by Parent and the Purchaser and, assuming the due authorization,
execution and delivery by Seller, constitutes a legal, valid and binding
obligation of each of Parent and the Purchaser enforceable against each of
Parent and the Purchaser in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
laws affecting creditors' rights generally (including, without limitation, the
effect of statutory and other law regarding fraudulent conveyances, fraudulent
transfers and preferential transfers), as may be limited by the exercise of
judicial discretion and the application of principles of equity including,
without limitation, requirements of good faith, fair dealing, conscionability
and materiality (regardless of whether considered in a proceeding in equity or
at law) and that the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceedings therefor may be brought.
SECTION 4.03 No Conflict; Required Filings and Consents. (a) The
execution and delivery of this Agreement by Parent and the Purchaser do not, and
the performance of this Agreement by Parent and the Purchaser will not, at the
time of closing, (i) conflict with or violate the Certificate of Incorporation
or By-laws of either Parent or the Purchaser, (ii) conflict with or violate any
law, rule, regulation, order, judgment or decree applicable to Parent or the
Purchaser or by which any property or asset of either of them is bound or
affected, or (iii) result in any breach of or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any rights of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or other encumbrance on any
property or asset of Parent or the Purchaser pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise
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or other instrument or obligation to which Parent or the Purchaser is
a party or by which Parent or the Purchaser or any property or asset of either
of them is bound or affected, except for any such conflicts, violations,
breaches, defaults or other occurrences which would not, individually or in the
aggregate, prevent Parent or the Purchaser from performing their respective
obligations under this Agreement.
(b) The execution and delivery of this Agreement by Parent and the
Purchaser do not and the performance of this Agreement by Parent and the
Purchaser will not, require any consent, approval, authorization or permit of,
or filing with or notification to, any governmental or regulatory authority to
be obtained or made by Parent or the Purchaser, domestic or foreign, except (i)
for applicable requirements, if any, of the Exchange Act, Blue Sky Laws and
state takeover laws and the HSR Act (ii) filings with the Nasdaq Small Cap
Market and the NASD filings required under the laws of foreign jurisdictions and
(iii) where failure to obtain such consents, approvals, authorizations or
permits, or to make such filings or notifications, would not prevent or delay
consummation of the Transactions, or otherwise prevent Parent or the Purchaser
from performing their respective obligations under this Agreement.
SECTION 4.04 Investment Intent. The Purchaser will acquire the Shares
for investment purposes only and not with a view to any resale or distribution
thereof and will not sell any Shares purchased pursuant to this Agreement except
in compliance with applicable federal and state securities laws.
SECTION 4.05 Absence of Litigation. There is no claim, action,
proceeding or investigation pending or, to the best knowledge of the Parent or
the Purchaser, threatened against the Parent or the Purchaser or any property or
asset of the Parent or the Purchaser before any court, arbitrator or
administrative, governmental or regulatory authority or body, domestic or
foreign that, if determined adversely to Parent or the Purchaser, would
materially impair the ability of Parent or the Purchaser to perform fully on a
timely basis their respective obligations under this Agreement. As of the date
hereof, neither the Parent nor the Purchaser is subject to any order, writ,
judgment, injunction, decree, determination or award that if determined
adversely to Parent or the Purchaser, would materially impair the ability of
Parent or the Purchaser to perform fully on a timely basis their respective
obligations under this Agreement.
SECTION 4.06 No Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement and the Merger Agreement
based on arrangements made by and on behalf of the Purchaser.
ARTICLE V
COVENANTS
SECTION 5.01 Irrevocable Proxy. Seller hereby irrevocably appoints
Purchaser, with full power of substitution and resubstitution, as Seller's
agent, attorney and proxy, during the term of this Agreement, to vote, or give
consents with respect to, all of the Shares owned by Seller in favor of the
Merger Agreement and the transactions contemplated thereby and against (a) any
other proposal for the acquisition of the Company or its assets or a merger or
other business combination of the Company with any third party or (b) any other
proposal that would, or is reasonably likely to, result in any of the conditions
to Purchaser's obligations under this Agreement not being fulfilled. Seller
intends this proxy to be irrevocable and coupled with an interest. Seller hereby
revokes any proxy previously granted with respect to Seller's Shares. Seller's
proxy granted pursuant to this Section 5.01 shall terminate and be revoked upon
any termination of this Agreement in accordance with its terms.
SECTION 5.02 Merger Agreement. Seller shall not, in his capacity as
stockholder of the Company, take any action or omit to take any action that is
inconsistent with compliance by the Company with the terms of the Merger
Agreement in all respects.
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From the date hereof through the Closing Date, Seller shall use his reasonable
best efforts to cause (i) the Company to fulfill all of its obligations under
the Merger Agreement and (ii) the representations and warranties contained in
Article III of the Merger Agreement to continue to be true and correct in all
material respects on and as of the Closing Date as if made on and as of the
Closing Date. Seller shall promptly notify, or cause to be notified, the
Purchaser of any event, condition or circumstance occurring from the date hereof
through the Closing Date that would constitute a violation or breach of this
Agreement or of the Merger Agreement.
SECTION 5.03 Standstill, Etc. From the date hereof to the Closing Date,
Seller covenants and agrees that, without the prior written consent of the
Purchaser, he will not (i) sell, tender pursuant to the Offer or any other
tender offer, pledge, encumber, assign, transfer, exchange or otherwise dispose
of, or enter into any contract, option or other arrangement or understanding
with respect to the sale, tender, pledge, encumbrance, assignment, transfer,
exchange or disposition of, any of the Shares; (ii) acquire any additional
shares of Company Common Stock or warrants, options or other rights to purchase
any shares of Company Common Stock; or (iii) grant any proxies (other than
pursuant to Section 5.01) with respect to the Shares, deposit any Shares into a
voting trust or enter into a voting agreement with respect to any Shares.
SECTION 5.04 No Solicitation. From the date hereof to the Closing Date,
Seller shall not, directly or indirectly, solicit, initiate or encourage any
discussions of, or submission of proposals or offers from any person, relating
to any acquisition or purchase of all or (other than in the ordinary course of
business) a portion of the assets of, or any equity interest in, the Company or
any of its subsidiaries or any business combination with the Company or any of
its subsidiaries, or participate in any negotiations regarding, or furnish to
any other Person any information with respect to, or otherwise cooperate in any
way with, or assist or participate in, facilitate or encourage, any effort or
attempt by any other person to do or seek any of the foregoing. Seller shall
immediately cease and cause to be terminated any existing discussions or
negotiations with any parties conducted heretofore with respect to any of the
foregoing and shall promptly notify the Purchaser if any such proposal or offer,
or any inquiry or contact with any Person with respect thereto, is made and
shall, in any such notice to the Purchaser, indicate in reasonable detail the
identity of the offeror and the terms and conditions of any proposal.
SECTION 5.05 Filings; Consents. (a) Seller, Parent and the Purchaser
will promptly file, or cause to be filed, with the FTC and the Department of
Justice, pursuant to the HSR Act, all requisite documents and notifications in
connection with the sale of the Shares pursuant to this Agreement. Each of
Parent and the Purchaser will make or cause to be made all such other filings
and submissions, if any, under laws and regulations applicable to Parent and the
Purchaser as may be required of each of them for the consummation of the
purchase of the Shares pursuant to this Agreement. Seller will make or cause to
be made all such other filings and submissions under laws and regulations
applicable to Seller, if any, as may be required of Seller for the consummation
of the sale of the Shares pursuant to this Agreement. Each of the parties hereto
agrees that it will coordinate and cooperate with the other parties hereto in
exchanging such information and providing such reasonable assistance as may be
requested in connection with all of the foregoing.
(b) Parent, the Purchaser and Seller will use their respective
reasonable best efforts to obtain, prior to the Closing, all consents and
approvals which are necessary to the consummation of the Transactions.
SECTION 5.06 Public Announcements. Seller, Parent and the Purchaser
will consult with each other before issuing any press releases or otherwise
making any public statements with respect to this Agreement and the Merger
Agreement and the transactions contemplated hereby and thereby, and shall not
issue any such press release or make any such public statement prior to such
consultation, except as may be required by law or any listing agreement with a
national securities exchange.
SECTION 5.07 Sales and Transfer Taxes. Seller shall pay any stock
transfer
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taxes and any real property gains and transfer taxes relating to the sale,
acquisition, conveyance, transfer and delivery of the Shares that are sold to
the Purchaser hereunder. The Purchaser and Seller shall cooperate with respect
to the filing of any returns, reports or other filings due in connection with
such Taxes.
SECTION 5.08 Guaranty by Parent. In consideration of the covenants,
agreements and undertakings of Seller contained in this Agreement, Parent hereby
guarantees to Seller, and his successors and assigns, the full, prompt and
complete payment and performance by the Purchaser of all of the covenants,
conditions and agreements of the Purchaser contained in this Agreement. Parent
hereby waives all notice of default by the Purchaser or notice of acceptance of
this Agreement by Seller, and consents to any extension that may be given by
Seller to the Purchaser of time of payment or performance. This guarantee shall
be construed as a continuing absolute and unconditional guarantee of payment and
performance and not as a guarantee of collection.
SECTION 5.09 Waiver of Appraisal Rights. Seller hereby waives any right
he may have to demand appraisal pursuant to Section 262 of the Delaware General
Corporation Law in connection with the Merger.
SECTION 5.10 Further Assurances. At any time and from time to time for
a reasonable period of time after the Closing, at the Purchaser's reasonable
request, Seller will duly execute, acknowledge and deliver all such further and
other assurances and documents, and will take such other action consistent with
the terms of this Agreement, at Seller's expense, for the purpose of better
assigning, transferring and conveying to the Purchaser, or reducing to the
Purchaser's possession, any or all of the Shares.
ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01 Conditions to the Obligations of Seller. The obligations
of Seller to consummate the purchase and sale contemplated by this Agreement
shall be subject to the fulfillment, at or prior to the Closing, of each of the
following conditions, any one or more of which may be waived by Seller:
(a) Representations and Warranties; Covenants. All representations and
warranties of Parent and the Purchaser contained in this Agreement shall be
true and correct on and as of the Closing Date (except for those
representations and warranties made as of a certain date, in which case, as
of that date), with the same force and effect as if made on and as of the
Closing Date (except for those representations and warranties made as of a
certain date, in which case, as of that date), except where the failure of
any representations or warranties to be true and correct would not, either
individually or in the aggregate, materially impair the ability or
obligation of Parent and Purchaser to perform fully on a timely basis their
respective obligations under this Agreement, and all material covenants
contained in this Agreement to be complied with by Parent and the Purchaser
on or before the Closing Date shall have been complied with in all material
respects.
(b) HSR Act. Any waiting period (and any extension thereof) under the
HSR Act applicable to the purchase of the Shares contemplated hereby shall
have expired or been terminated.
(c) No Order. No United States, state or foreign governmental authority
or other agency or commission or United States or state court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered
any statute, rule, regulation, injunction or other order (whether
temporary, preliminary or permanent) which is in effect and has the effect
of making the acquisition of the Shares illegal or otherwise prohibiting
consummation of the Transactions.
(d) The Merger Agreement. The Merger Agreement shall not have been
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terminated, prior to the acceptance for payment by Purchaser of any shares
of Company Common Stock pursuant to the Offer, by the Company as a result
of a material breach by Parent or Purchaser of its respective obligations
under the Merger Agreement.
SECTION 6.02 Conditions to Obligations of Parent and the Purchaser. The
obligations of Parent and the Purchaser to consummate the purchases and sales
contemplated by this Agreement shall be subject to the fulfillment, at or prior
to the Closing, of each of the following conditions, any one or more of which
may be waived by them:
(a) Representations and Warranties; Covenants. All representations and
warranties of Seller contained in this Agreement shall be true and correct
in all respects as of the Closing Date (except for those representations
and warranties made as of a certain date, in which case, as of that date),
with the same force and effect as if made as of the Closing Date (except
for those representations and warranties made as of a certain date, in
which case, as of that date), except where the failure of any
representations or warranties to be true and correct would not, either
individually or in the aggregate, have a Material Adverse Effect on the
Company and all material covenants contained in this Agreement to be
complied with by Seller on or before the Closing Date shall have been
complied with in all material respects.
(b) HSR Act. Any waiting period (and any extension thereof) under the
HSR Act applicable to the purchase of the Shares contemplated hereby shall
have expired or been terminated.
(c) No Order. No United States, state or foreign governmental authority
or other agency or commission or United States or state court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered
any statute, rule, regulation, injunction or other order (whether
temporary, preliminary or permanent) which is in effect and has the effect
of making the acquisition of Shares illegal or otherwise prohibiting
consummation of the Transactions.
(d) No Material Adverse Effect. No event or events shall have occurred,
or be reasonably likely to occur, which, individually or in the aggregate,
have, or could reasonably be expected to have, a Material Adverse Effect on
the Company.
(e) Key Employee; Employment Agreement. Seller shall have continued to
be employed as Chief Executive Officer of the Company with duties and
responsibilities comparable to the duties and responsibilities he has
performed in the past and shall have executed and delivered to the Company
the Employment Agreement substantially in the form attached hereto as
Exhibit A.
(f) Conditions to Offer. All conditions to Purchaser's obligation to
accept for payment shares of Company Common Stock tendered pursuant to the
Offer shall have been satisfied.
ARTICLE VII
INDEMNIFICATION
SECTION 7.01 Survival. Subject to the limitations and other provisions
of this Agreement, the representations and warranties of the parties hereto
contained herein shall survive the Closing and shall remain in full force and
effect, regardless of any investigation made by or on behalf of any of the
parties hereto, for a period of two years after the Closing Date, except for the
representations and warranties contained in Sections 3.01 and 3.02, which shall
survive the Closing Date without limitation. Neither the period of survival nor
the liability of Seller with respect to Seller's representations and warranties
shall be reduced by any investigation made at any time by or on behalf of the
Purchaser or Parent. If written notice of a claim has been given prior to the
expiration of the applicable representations and
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warranties by the Purchaser or Parent to Seller, then the relevant
representations and warranties shall survive as to such claim, until such claim
has been finally resolved. The covenants and agreements of the parties hereto
shall survive the Closing and shall remain in full force and effect, regardless
of any investigation of any of the parties hereto.
SECTION 7.02 Indemnification. (a) Subject to the other terms and
conditions of this Agreement and as an adjustment to purchase price, Seller
agrees to indemnify Parent and any subsidiary or affiliate thereof, whether now
or thereafter such a subsidiary or affiliate, and any director, officer or
employee of any thereof against and hold each of them harmless from all Losses
arising out of the breach of any representation or warranty of Seller, or any
covenant or agreement of Seller herein. Anything in Section 7.01 to the contrary
notwithstanding, no claim may be asserted nor may any action be commenced
against Seller for breach of any representation or warranty, unless notice of
such claim or action is received by Seller describing in reasonable detail the
facts and circumstances with respect to the subject matter of such claim or
action on or prior to the date on which the statute of limitations with respect
to such representation or warranty expires.
(b) Subject to the other terms and conditions of this Agreement, Parent
and the Purchaser agree, jointly and severally, to indemnify Seller against and
hold Seller harmless from all Losses arising out of the breach of any
representation or warranty in Section 4.04 or 4.06 or any covenant or agreement
of Parent and the Purchaser herein. Anything in Section 7.01 to the contrary
notwithstanding, no claim may be asserted nor may any action be commenced
against Parent or the Purchaser for breach of any representation or warranty
unless notice of such claim or action is received by Parent or the Purchaser
describing the facts and circumstances with respect to the subject matter of
such claim or action on or prior to the date on which the statute of limitations
with respect to such representation or warranty expires.
(c) Promptly after receipt by any party hereto (the "Indemnified
Person") of notice of any demand, claim or circumstances which, with lapse of
time, would or might give rise to a claim or the commencement (or threatened
commencement) of any action, proceeding or investigation that may result in a
Loss, the Indemnified Person shall give notice thereof (the "Claims Notice") to
any party or parties obligated to provide indemnification pursuant to this
Section 7.02 (the "Indemnifying Party"). The Claims Notice shall describe such
threatened claim or demand in reasonable detail, and shall indicate the amount
(estimated, if necessary) of the Loss that has been or may be suffered by the
Indemnified Person. The Indemnifying Party shall have the right to direct,
through counsel of its own choosing, the defense or settlement of any such claim
or proceeding at its own expense. If the Indemnifying Party elects to assume the
defense of any such claim, the Indemnified Person may participate in such
defense, but in such case the expenses of the Indemnified Person shall be paid
by the Indemnified Person; provided, however, that if there exists or is
reasonably likely to exist a conflict of interest that would make it
inappropriate in the judgment of the Indemnified Person, in its sole and
absolute discretion, for the same counsel to represent both the Indemnified
Person and the Indemnitor, then the Indemnified Person shall be entitled to
retain its own counsel, in each jurisdiction for which the Indemnified Person
determines counsel is required, at the expense of the Indemnitor. Such
Indemnified Person shall cooperate with the Indemnifying Party in the defense or
settlement thereof, and shall make available to the Indemnifying Party any
documents or other papers within its control that are necessary or appropriate
for such defense, and the Indemnifying Party shall reimburse the Indemnified
Person for all its reasonable out-of-pocket expenses in connection therewith. If
the Indemnifying Party elects to direct the defense of any such claim, the
Indemnified Person shall not pay, or permit to be paid, any part of any claim
arising from such asserted liability unless the Indemnifying Party consents in
writing to such payment or unless the Indemnifying Party, subject to the last
sentence of this Section 7.02(c), withdraws from the defense of such asserted
liability or unless a final judgment from which no appeal may be taken by or on
behalf of the Indemnifying Party is entered against the Indemnified Person for
such liability. If the Indemnifying Party shall fail to defend, or if after
commencing or undertaking any such defense fails to prosecute or withdraws from
such defense, the Indemnified Person shall have the right to undertake the
defense or settlement thereof, at the Indemnifying Party's expense. If the
Indemnified Person assumes the defense of any such claim or proceeding pursuant
to this Section 7.02(c) and proposes to settle such
14
claim or proceeding prior to a final judgment thereon or to forego appeal with
respect thereto, then the Indemnified Person shall give the Indemnifying Party
prompt notice thereof and the Indemnifying Party shall have the right to
participate in the settlement or assume or reassume the defense of such claim or
proceeding.
(d) Without limiting any other remedy available to any Indemnified
Person, each Indemnified Person that shall have suffered a Loss as to which it
shall be entitled to indemnification, shall be entitled to satisfy, either in
whole or in part, such right to indemnification by setting off or recouping the
amount of such Loss, or any portion thereof, against any obligation that any
Indemnified Person or any affiliate thereof shall have to pay money to Seller,
including, without limitation, any amounts owed by Parent or the Purchaser to
Seller pursuant to any employment contract of Seller.
SECTION 7.03 Limitations on Indemnification. (a) Notwithstanding any
provision to the contrary contained in this Agreement, the indemnifications in
favor of the Purchaser and Parent contained in Section 7.02(a) herein shall not
be effective until the aggregate dollar amount of all Losses indemnified against
under such section exceeds $100,000; provided, however, that the maximum amount
of indemnifiable Losses which may be recovered from Seller arising out of or
resulting from the causes enumerated in this Article VII shall be an amount
equal to $2,000,000 with respect to any Losses in connection with a breach of
the representation and warranty set forth in Section 3.07 and the aggregate
purchase price paid to Seller pursuant to Section 2.01 with respect to all other
Losses.
(b) Notwithstanding any provision to the contrary contained in this
Agreement, the indemnifications in favor of the Seller contained in Section
7.02(b) herein shall not be effective until the aggregate dollar amount of all
Losses indemnified against under such section exceeds $100,000; provided,
however, that the maximum amount of indemnifiable Losses which may be recovered
from the Purchaser and Parent arising out of or resulting from the causes
enumerated in this Article VII shall be an amount equal to the aggregate
purchase price paid to Seller pursuant to Section 2.01 with respect to all
Losses.
(c) To the extent that an indemnification obligation pursuant to one of
the provisions of Section 7.02 herein overlaps with an indemnification
obligation pursuant to any
15
other provision of Section 7.02 herein or any other provision of this Agreement,
the party seeking such indemnification shall be entitled to only one of such
indemnification payments.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
SECTION 8.01 Termination. This Agreement may be terminated at any time
prior to the Closing:
(a) By the mutual written consent of Seller and the Purchaser;
(b) By either party, if the Closing shall not have occurred by March
31, 1996; provided, however, that the right to terminate this Agreement
under this Section 8.01(b) shall not be available to any party whose
failure to fulfill any obligation under this Agreement shall have been the
cause of, or shall have resulted in, the failure of the Closing to occur on
or prior to such date;
(c) By the Purchaser if, between the date hereof and the time scheduled
for the Closing: (i) an event or condition occurs that has resulted in or
that may be expected to result in a Material Adverse Effect on the Company,
(ii) any material representation or warranty of Seller contained in this
Agreement shall not have been true and correct when made or deemed made,
(iii) Seller shall not have complied with any material covenant or
agreement to be complied with by it and contained in this Agreement; or
(iv) Seller, the Company or any Subsidiary makes a general assignment for
the benefit of creditors, or any proceeding shall be instituted by or
against Seller, the Company or any Subsidiary seeking to adjudicate any of
them a bankrupt or insolvent, or seeking liquidation, winding up or
reorganization, arrangement, adjustment, protection, relief or composition
of its debts under any Law relating to bankruptcy, insolvency or
reorganization;
(d) by Seller if, prior to the acceptance for purchase by Purchaser of
any shares of Company Common Stock pursuant to the Offer, the Company shall
terminate the Merger Agreement as a result of a material breach by Parent
or Purchaser of its respective obligations thereunder; or
(e) by Parent and Purchaser upon termination of the Offer or the Merger
Agreement in accordance with the terms thereof for any reason other than a
material breach by Parent or Purchaser of their respective obligations
thereunder.
SECTION 8.02 Effect of Termination. In the event of termination of this
Agreement as provided in Section 8.01, this Agreement shall forthwith become
void and there shall be no liability on the part of any party hereto, except (a)
as set forth in Section 9.04 and (b) nothing herein shall relieve either party
from liability for any breach hereof.
SECTION 8.03 Amendment. This Agreement may not be amended or modified
except by an instrument in writing signed by Seller, Parent and the Purchaser.
SECTION 8.04 Waiver. At any time prior to the Closing, any party hereto
may (a) waive any inaccuracies in the representations and warranties of the
other party contained herein or in any document delivered pursuant hereto and
(b) waive compliance by the other party with any of the agreements or conditions
contained herein. Any such waiver shall be valid if set forth in an instrument
in writing signed by the party to be bound thereby.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices. Any notice or other communication required or
permitted hereunder shall be in writing, and shall be delivered personally,
telegraphed,
16
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage prepaid. Any such notice shall be deemed to have been
given when so telegraphed, telexed or, if sent by facsimile transmission,
answerback received, or if mailed, two days after deposit in the United States
mails, or if personally delivered, addressed to the parties as follows:
Parent or the Purchaser:
Thomson U.S. Holdings Inc.
c/o The Thomson Corporation
Metro Center at Xxx Xxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: General Counsel
Telecopier: (000) 000-0000
With a copy to:
Research Institute of America
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx
Telecopier: (000) 000-0000
And a copy to:
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
Telecopier: (000) 000-0000
Seller:
Xxxxxx X. Xxxxx, Xx.
0000 Xxxxxx Xxxxxxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Telecopier: (000) 000-0000
With a copy to:
Peper, Martin, Xxxxxx, Xxxxxxx and Xxxxxxx
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xxxx X. Short, Esq.
Any party may change its above address and attorney for notices upon written
notice to the other parties in accordance with this Section 9.01.
SECTION 9.02 Assignment. All terms of this Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and their respective legal
representatives, successors, heirs and assigns. This Agreement, however, may not
be assigned by any party without the prior written consent of the other parties.
SECTION 9.03 Entire Agreement; Headings. This Agreement and the Merger
Agreement constitute the entire agreement between the parties hereto with
respect to the transactions contemplated hereby and shall supersede and cancel
all prior and contemporaneous agreements, whether written or oral, between such
parties dealing with the subject matter hereof. Section and paragraph headings
are not to be considered part of this Agreement and are included solely for
convenience and are not intended to be full or accurate descriptions of the
contents
17
thereof.
SECTION 9.04 Fees and Expenses. All costs and expenses incurred in
connection with this Agreement (i) by Parent and the Purchaser shall be paid by
Parent and the Purchaser and (ii) by Seller shall be paid by the Company,
whether or not the transactions contemplated hereby are consummated.
SECTION 9.05 Equitable Relief; Preservation of Remedies. If either
Seller on the one hand, or the Purchaser on the other hand, commits a breach, or
threatens to commit a breach, of its obligations to consummate the transactions
provided for herein, the other party shall have the right and remedy to have the
provisions of this Agreement specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any such breach or
threatened breach will cause irreparable injury to Seller on the one hand, and
the Purchaser on the other, and that money damages will not provide an adequate
remedy to the other party.
SECTION 9.06 No Third-Party Beneficiaries. Nothing in this Agreement
shall confer any rights upon any person who or entity which is not a party or an
assignee of a party to this Agreement.
SECTION 9.07 Counterparts. This Agreement may be signed in any number
of counterparts with the same effect as if the signatures to each counterpart
were upon a single instrument, and all such counterparts together shall be
deemed an original of this Agreement.
SECTION 9.08 Severability. If any provision of this Agreement, or the
application of any such provision to any person or circumstance, shall be held
invalid by a court of competent jurisdiction, the remainder of this Agreement,
or the application of such provision to persons or circumstances other than
those as to which it is held invalid, shall not be affected thereby.
SECTION 9.09 Consent to Jurisdiction. Seller, Parent and the Purchaser
each hereby irrevocably and unconditionally:
(a) Submits itself in any legal action or proceeding relating to this
Agreement, or for recognition and enforcement of any judgment in respect
hereof, to the non- exclusive jurisdiction of the courts of the State of
New York located in the City of New York and the courts of the United
States of America for the Southern District of New York, and Appellate
courts from any thereof, and consents and agrees to such action or
proceeding being brought in such courts;
(b) Confirms that its obligations hereunder are wholly commercial in
nature, waives and agrees not to assert, by way of motion, as a defense, or
otherwise, in any suit, action or proceeding relating to this Agreement or
any claim that it is not personally subject to the jurisdiction of the
courts named in paragraph (a) above;
(c) Waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or
claim the same;
SECTION 9.10 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed wholly within such State.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THOMSON U.S. HOLDINGS INC.
18
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Executive Vice President
SCS SUBSIDIARY, INC.
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Treasurer
/s/ Xxxxxx X. Xxxxx, Xx.
Xxxxxx X. Xxxxx, Xx.
19
Consent of Spouse
The undersigned, as the spouse of Xxxxxx X. Xxxxx, Xx., who is a
signatory of the foregoing Stock Purchase Agreement, hereby consents to,
confirms and ratifies any sale by her spouse of any Shares contemplated by the
foregoing Stock Purchase Agreement, and for purposes of any community property
laws and all other laws, conveys all her right, title and interest in and to
such Shares to the purchaser of such Shares.
/s/ Xxx Xxx Xxxxx