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Exhibit 2.1
EXECUTION VERSION
AGREEMENT AND PLAN OF MERGER
Among
VNU N.V.
ARTIST ACQUISITION, INC.
and
ACNIELSEN CORPORATION
Dated as of December 17, 2000
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TABLE OF CONTENTS
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ARTICLE I
THE OFFER
SECTION 1.01 The Offer 2
SECTION 1.02 Offer Documents 3
SECTION 1.03 Company Actions 4
SECTION 1.04 Directors 5
ARTICLE II
THE MERGER
SECTION 2.01 The Merger 6
SECTION 2.02 Closing 6
SECTION 2.03 Effective Time 6
SECTION 2.04 Effects of the Merger 7
SECTION 2.05 Certificate of Incorporation; By-Laws 7
SECTION 2.06 Directors; Officers 7
SECTION 2.07 Effect on Capital Stock 7
SECTION 2.08 Options; Stock Plans 8
SECTION 2.09 Payment for Shares 9
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
SECTION 3.01 Organization, Standing and Corporate Power 11
SECTION 3.02 Corporate Authorization 11
SECTION 3.03 Consents and Approvals; No Violations 12
SECTION 3.04 Capital Structure 13
SECTION 3.05 SEC Documents 14
SECTION 3.06 Absence of Certain Changes or Events 14
SECTION 3.07 No Undisclosed Liabilities 15
SECTION 3.08 Certain Information 15
SECTION 3.09 Real Property 16
SECTION 3.10 Intellectual Property 16
SECTION 3.11 Certain Contracts and Arrangements 17
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SECTION 3.12 Litigation; Compliance with Laws 18
SECTION 3.13 Environmental Laws 19
SECTION 3.14 Taxes 20
SECTION 3.15 Benefit Plans 21
SECTION 3.16 Labor Matters 24
SECTION 3.17 Opinion of Financial Advisor 24
SECTION 3.18 Voting Requirements 24
SECTION 3.19 Rights Agreement 25
SECTION 3.20 Brokers 25
SECTION 3.21 Executive Agreements 25
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER
SECTION 4.01 Organization, Standing and Corporate Power 25
SECTION 4.02 Corporate Authorization 26
SECTION 4.03 Consents and Approvals; No Violations 26
SECTION 4.04 Certain Information 27
SECTION 4.05 Vote Required 27
SECTION 4.06 No Business Activities 27
SECTION 4.07 No Company Capital Stock 27
SECTION 4.08 Sufficient Funds 28
ARTICLE V
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 5.01 Conduct of Business of the Company 28
ARTICLE VI
ADDITIONAL COVENANTS
SECTION 6.01 Company Stockholders Meeting; Proxy Statement; Merger 30
SECTION 6.02 Access to Information; Notification of Certain Matters 31
SECTION 6.03 Reasonable Best Efforts 32
SECTION 6.04 Public Announcements 32
SECTION 6.05 No Solicitation 32
SECTION 6.06 Consents, Approvals and Filings 33
SECTION 6.07 Employee Benefit Plans 34
SECTION 6.08 Indemnification; Directors' and Officers' Insurance 35
SECTION 6.09 Undertakings 37
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ARTICLE VII
CONDITIONS PRECEDENT
SECTION 7.01 Conditions to Each Party's Obligation to Effect the Merger 37
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
SECTION 8.01 Termination 38
SECTION 8.02 Effect of Termination 40
SECTION 8.03 Fees and Expenses 41
SECTION 8.04 Amendment and Modification 41
SECTION 8.05 Extension; Waiver 42
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.01 Notices 42
SECTION 9.02 Certain Definitions 43
SECTION 9.03 Interpretation 43
SECTION 9.04 Entire Agreement; No Third-Party Beneficiaries 44
SECTION 9.05 Governing Law 44
SECTION 9.06 Assignment 44
SECTION 9.07 Enforcement 44
SECTION 9.08 Waiver of Jury Trial 45
SECTION 9.09 Severability 45
SECTION 9.10 Counterparts 45
</TABLE>
Schedules
Schedule A Executive Employees
Schedule B List of Subsidiaries
Disclosure Schedule
Exhibits
Exhibit A Conditions to the Offer
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Glossary of Defined Terms
Each term set forth below has the meaning set forth in the
Sections set forth below:
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Accelerated Stock Options 2.08(a)
Acceptable Conditional Advice Exhibit A
Acquisition Proposal 6.05(b)
Affected Employee 6.07(a)
affiliate 9.02(a)
Agreement Preamble
Business Day 9.02(b)
CAC 1.01(c)
Certificate of Merger 2.03
Certificates 2.09(b)
Closing 2.02
Closing Date 2.02
Code 2.09(g)
Common Stock Recitals
Company Preamble
Company ERISA Plans 3.15
Company Licensed Intellectual Property 3.10(b)
Company Owned Intellectual Property 3.10(b)
Company Plans 3.15
Company Stock Option Plans 3.04
Confidentiality Agreement 6.02(a)
Continuing Directors 1.04(c)
Covered Parties 6.08(b)
Credit Agreement 3.04
DGCL Recitals
Directors' Deferred Compensation Plan 3.04
Directors' Plan 3.04
Disclosure Schedule Article III
Dissenting Shares 2.07(d)
EC Merger Regulation 1.01(c)
Effective Time 2.03
Employee Stock Ownership Plan 3.04
Environmental Claim 3.13(d)
Environmental Laws 3.13(e)
ERISA 3.15
ERISA Affiliate 3.15
Euro Compliant 3.10(c)
Exchange Act 1.01(a)
Executive Agreements Recitals
Executive Employees Recitals
Executive Plan 3.04
Facility Exhibit A
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Facility Guarantee Exhibit A
Filed SEC Documents 3.07
Foreign Benefit Plan 3.15(n)
fully diluted basis 1.01(c)
GAAP 3.05
Governmental Entity 3.03(b)
Guarantor 1.04(c)
Hazardous Materials 3.13(f)
HSR Act 3.03(b)
Incentive Plan 3.04
Indemnified Liabilities 6.08(b)
Intellectual Property 3.10(e)
Internal MIS Systems 3.10(c)
IP Contracts 3.10(a)
IRS ruling 3.14(a)(viii)
Key Employees' Stock Incentive Plan 3.04
knowledge 9.02(c)
Leased Real Property 3.09(a)
Liens 3.04
Management Plan 3.04
Material Adverse Effect 3.01
Material Contracts 3.11
Merger Recitals
Merger Consideration 2.07(c)
Minimum Condition 1.01(c)
NMR 3.10(a)
NYSE 3.03(b)
Offer 1.01(a)
Offer Consideration 1.01(a)
Offer Documents 1.02(a)
Offer to Purchase 1.02(a)
on a fully-diluted basis 1.01(c)
Option Spread 2.08(a)
Parent Preamble
Parent Designees 1.04(a)
Paying Agent 2.09(a)
Payment Fund 2.09(a)
Permits 3.12(b)
person 9.02(d)
Positive Advice Exhibit A
Preferred Stock 3.04
Proxy Statement 6.01(b)
Purchaser Preamble
Rabbi Trusts 6.07(f)
Real Property 3.09(a)
Real Property Leases 3.09(c)
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Release 3.13(g)
Replacement Plan 3.04
Returns 3.14(a)
Rights Recitals
Rights Agreement Recitals
Rights Amendment 3.19
Schedule 14D-9 1.03(b)
Schedule TO 1.02(a)
SEC 1.01(c)
SEC Documents 3.05
Securities Act 3.05
Series Common Stock 3.04
Shares Recitals
Stock Option 2.08(a)
Stockholders Meeting 6.01(a)
Subsidiary 9.02(e)
Superior Proposal 6.05(c)
Surviving Corporation 2.01
Taxes 3.14(b)
Termination Date 8.01(c)
Termination Fee 8.03(b)
Works' Council 1.01(c)
</TABLE>
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of December 17, 2000
(including any schedule and exhibit hereto, this "Agreement"), by and among VNU
N.V., a corporation organized under the laws of the Netherlands ("Parent"),
ARTIST ACQUISITION, INC., a Delaware corporation and wholly owned subsidiary of
Parent ("Purchaser"), and ACNIELSEN CORPORATION, a Delaware corporation (the
"Company"):
WHEREAS, the respective Boards of Directors of Parent,
Purchaser and the Company have each determined that it would be advisable and in
the best interests of their respective stockholders for Parent to acquire the
Company upon the terms and subject to the conditions set forth in this
Agreement;
WHEREAS, to effectuate the acquisition, it is proposed that
Purchaser commence a cash tender offer to purchase all of the issued and
outstanding shares of common stock, par value $.01 per share (the "Common
Stock"), of the Company, including the associated Preferred Share Purchase
Rights (the "Rights" and, together with the Common Stock, the "Shares") issued
pursuant to a Rights Agreement, dated as of October 17, 1996, between the
Company and First Chicago Trust Company of New York (the "Rights Agreement"), on
the terms and subject to the conditions set forth in this Agreement and the
Offer Documents (as defined in Section 1.02(a));
WHEREAS, to effectuate the acquisition, it is further proposed
that following consummation of the Offer (as defined in Section 1.01(a)),
Purchaser will be merged with and into the Company, with the Company continuing
as the surviving corporation in such merger (the "Merger");
WHEREAS, the Board of Directors of the Company has, by the
unanimous vote of all directors (a) determined that the Offer and the Merger are
fair to and in the best interests of the Company and its stockholders; (b)
approved this Agreement and the transactions contemplated hereby, including the
Offer and the Merger, in accordance with the General Corporation Law of the
State of Delaware (the "DGCL"); and (c) declared the advisability of this
Agreement and resolved to recommend that the holders of the Shares accept the
Offer and adopt this Agreement; and
WHEREAS, certain executive officers as set forth on Schedule A
to this Agreement (together, the "Executive Employees") have executed and
delivered concurrently with, and as a condition to the execution of this
Agreement, agreements (the "Executive Agreements") which include, among other
things, non-competition and non-solicitation provisions;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and other terms contained in this
Agreement, the parties hereto, intending to be legally bound hereby, agree as
follows:
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ARTICLE I
THE OFFER
SECTION 1.01 The Offer. (a) Provided that none of the events
set forth in Exhibit A hereto shall have occurred and be continuing, on the
fifth Business Day (as defined in Section 9.02(b)) after the public announcement
by Parent and the Company of the execution and delivery of this Agreement
(counting the Business Day on which such announcement is made), Purchaser shall
commence (within the meaning of Rule 14d-2 under the U.S. Securities Exchange
Act of 1934, as amended (together with the rules and regulations thereunder, the
"Exchange Act")), an offer (the "Offer") to purchase all of the outstanding
Shares, at a price of $36.75 per Share, net to the seller in cash (as paid
pursuant to the Offer, the "Offer Consideration"). The obligation of Parent and
Purchaser to commence the Offer, to consummate the Offer and to accept for
payment and pay for Shares validly tendered in the Offer and not withdrawn shall
be subject to the conditions set forth in Exhibit A hereto.
(b) On the terms and subject to the prior satisfaction or
waiver of the conditions of the Offer, Parent shall provide, or cause to be
provided, funds to Purchaser and Purchaser shall accept for payment and pay for
all Shares validly tendered and not withdrawn pursuant to the Offer as soon as
practicable after the expiration date thereof.
(c) Without the prior written consent of the Company,
Purchaser shall not (i) change the form of the Offer Consideration paid; (ii)
decrease the Offer Consideration; (iii) decrease the number of Shares sought
pursuant to the Offer; (iv) extend the expiration date of the Offer beyond the
initial expiration date of the Offer (which shall be the 20th Business Day after
commencement of the Offer), except (A) as required by applicable law or by any
rule or regulation of the U.S. Securities and Exchange Commission (the "SEC "),
or (B) that if, immediately prior to the expiration date of the Offer (as it may
be extended), the Shares tendered and not withdrawn pursuant to the Offer
constitute at least 80% but less than 90% of the outstanding Shares, Purchaser
may, in its sole discretion, extend the Offer for one or more periods not to
exceed an aggregate of five Business Days, notwithstanding that all conditions
to the Offer are satisfied as of such expiration date of the Offer, or (C) that
if any condition to the Offer has not been satisfied or waived, Purchaser may,
in its sole discretion, extend the expiration date of the Offer for one or more
periods (not in excess of ten Business Days each) but in no event later than
June 30, 2001; (v) waive the condition (the "Minimum Condition ") that there
shall have been validly tendered and not withdrawn immediately prior to the time
the Offer expires such number of Shares which, together with the Shares then
owned by Parent, would constitute at least a majority of the Shares outstanding
on a fully-diluted basis on the date of purchase ("on a fully-diluted basis"
meaning the number of Shares outstanding, together with the Shares which the
Company may be required to issue pursuant to warrants, Stock Options (as defined
in Section 2.08) or obligations outstanding at that date under employee stock or
similar benefit plans or otherwise whether or not vested or then exercisable);
(vi) waive the condition relating to the expiration of the waiting period under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act") and, if
required, under the Competition Act (Canada) and the rules and regulations
thereunder (the "CAC"), the condition relating to the issuance of a decision
under Article 6(1)(b) or 8(2) of Council Regulation No. 4064/89 of the
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European Community, as amended (the "EC Merger Regulation"), or the condition
relating to the non-termination of this Agreement; (vii) amend any term or other
condition of the Offer in any manner adverse to holders of Shares; or (viii)
impose any additional condition to the Offer; provided, however, that, except as
set forth above and subject to applicable legal requirements, Purchaser may
waive any condition to the Offer in its sole discretion; and provided further
that the Offer may be extended in connection with an increase in the
consideration to be paid pursuant to the Offer so as to comply with applicable
rules and regulations of the SEC. If the Offer shall not have been consummated
at the scheduled expiration thereof due to the failure to satisfy (i) any of the
conditions to the Offer set forth in clause (e)(i) or (e)(iv) of Exhibit A, (ii)
the condition to the Offer relating to the expiration of the waiting period
under the HSR Act and, if required, the CAC, or (iii) the condition relating to
the issuance of a decision under Article 6(1)(b) or 8(2) of the EC Merger
Regulation, Parent will, at the request of the Company, cause Purchaser to
extend the expiration date of the Offer for one or more periods (not in excess
of ten Business Days each) but in no event later than June 30, 2001. If the
Offer shall not have been consummated at the scheduled expiration thereof due to
the failure to satisfy the condition relating to the Central Works' Council of
Parent (as defined in Section 1.04(c)) (the "Works' Council") set forth in
clause (c) of Exhibit A, Parent will, at the request of the Company, cause
Purchaser to extend the expiration date of the Offer for one or more periods
(not in excess of ten Business Days each) but in no event later than September
30, 2001.
SECTION 1.02 Offer Documents. (a) As promptly as reasonably
practicable on the date of commencement of the Offer, Parent and Purchaser shall
file or cause to be filed with the SEC a Tender Offer Statement on Schedule TO
(together with all amendments and supplements thereto, the "Schedule TO") with
respect to the Offer. The Schedule TO shall contain or shall incorporate by
reference an offer to purchase (the "Offer to Purchase") and forms of the
related letter of transmittal and any related summary advertisement (the
Schedule TO, the Offer to Purchase and such other ancillary documents, together
with all supplements, instruments and amendments thereto, being referred to
herein collectively as the "Offer Documents"). The Company will promptly supply
to Parent and Purchaser in writing, for inclusion in the Offer Documents, all
information concerning the Company required under the Exchange Act to be
included in the Offer Documents.
(b) Each of Parent and Purchaser further agrees to take all
steps necessary to cause the Offer Documents to be filed with the SEC and to be
disseminated to holders of Shares, in each case as and to the extent required by
applicable federal securities laws. Each of Parent, Purchaser and the Company
shall promptly correct any information provided by them for use in the Offer
Documents if and to the extent that such information shall be or have become
false or misleading in any material respect, and Parent and Purchaser shall take
all lawful action necessary to cause the Offer Documents as so corrected to be
filed promptly with the SEC and to be disseminated to holders of Shares as and
to the extent required by applicable law. The Company and its counsel shall be
given a reasonable opportunity to review and comment on the Offer Documents and
any amendments thereto prior to the filing thereof with the SEC. Parent and
Purchaser agree to provide the Company and its counsel any comments Parent,
Purchaser or their counsel may receive from the SEC or its staff with respect to
the Offer Documents promptly after the receipt of such comments.
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SECTION 1.03 Company Actions. (a) The Company hereby approves
of and consents to the Offer and represents and warrants that (i) its Board of
Directors (at a meeting duly called and held on December 17, 2000) has by the
unanimous vote of all directors (A) determined that each of this Agreement, the
Offer and the Merger are fair to and in the best interests of the Company's
stockholders, (B) approved this Agreement and the transactions contemplated
hereby, including the Offer and the Merger, and such approval is sufficient to
render the restrictions on "business combinations" (as defined in Section 203 of
the DGCL) set forth in Section 203 of the DGCL inapplicable to this Agreement
and the transactions contemplated hereby, including the Offer and the Merger,
and (C) declared the advisability of this Agreement and resolved to recommend
acceptance of the Offer and adoption of this Agreement by the holders of Shares;
provided, however, that prior to the consummation of the Offer, the Board of
Directors of the Company may modify, withdraw or change such recommendation to
the extent that the Board of Directors, after receiving advice from outside
counsel, concludes in good faith that such action is reasonably necessary in
order for the Board of Directors to act in a manner consistent with the Board's
fiduciary duties under applicable law, and (ii) Evercore Group Inc. has
delivered to the Board of Directors of the Company its opinion that the Offer
Consideration to be received by the holders of Shares in the Offer and the
Merger is fair, from a financial point of view, to such holders. The Company
hereby consents to the inclusion in the Offer Documents of the recommendation of
the Board described in the immediately preceding sentence. The Company has been
advised by its directors and executive officers that they either intend to
tender all Shares beneficially owned by them to Purchaser pursuant to the Offer
or, if applicable, vote all such Shares in favor of the Merger.
(b) The Company shall file with the SEC, as promptly as
reasonably practicable on the date of commencement of the Offer, a
Solicitation/Recommendation Statement on Schedule 14D-9 (together with any
supplements or amendments thereto, the "Schedule 14D-9") containing the
recommendation of the Board of Directors of the Company in favor of the Offer
and the adoption of this Agreement and the transactions contemplated hereby,
including the Merger, provided, however, that prior to the consummation of the
Offer, the Board of Directors of the Company may modify, withdraw or change such
recommendation to the extent that the Board of Directors, after receiving advice
from outside counsel, concludes in good faith that such action is reasonably
necessary in order for the Board of Directors to act in a manner consistent with
the Board's fiduciary duties under applicable law. Each of Parent and Purchaser
will promptly supply to the Company in writing, for inclusion in the Schedule
14D-9, all information concerning the Parent Designees (as defined in Section
1.04(a) hereof), as required by Section 14(f) of the Exchange Act and Rule 14f-1
thereunder, and the Company shall include such information in the Schedule
14D-9. Parent will promptly supply to the Company in writing, for inclusion in
the Schedule 14D-9, any information concerning Parent or Purchaser required
under the Exchange Act and the rules and regulations thereunder to be included
in the Schedule 14D-9. The Company further agrees to take all steps necessary to
cause the Schedule 14D-9 to be filed with the SEC and to be disseminated to
holders of Shares, in each case as and to the extent required by applicable
federal securities laws. Each of the Company, Parent and Purchaser shall
promptly correct any information provided by them for use in the Schedule 14D-9
if and to the extent that such information shall be or have become false or
misleading in any material respect and the Company shall take all lawful action
necessary to cause the Schedule 14D-9 as so corrected to be filed promptly with
the SEC and disseminated to the holders of Shares as and to the extent required
by applicable law. Parent, Purchaser and their
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counsel shall be given a reasonable opportunity to review and comment on the
Schedule 14D-9 and any amendments thereto prior to the filing thereof with the
SEC. The Company agrees to provide Parent and its counsel any comments the
Company or its counsel receive from the SEC or its staff with respect to the
Schedule 14D-9 promptly after receipt of such comments.
(c) In connection with the Offer, the Company shall promptly
furnish Parent and Purchaser with mailing labels, security position listings and
all available listings or computer files containing the names and addresses of
the record holders of Shares as of the latest practicable date and shall furnish
Parent and Purchaser with such information and assistance (including updated
lists of stockholders, mailing labels and lists of security positions) as Parent
and Purchaser or their agents may reasonably request in communicating the Offer
to the record and beneficial holders of Shares.
SECTION 1.04 Directors. (a) Promptly after the purchase of and
payment for the Shares by Purchaser pursuant to the Offer, Parent shall be
entitled to designate such number of directors (the "Parent Designees"), rounded
up to the next whole number, on the Company's Board of Directors as is equal to
the product of the total number of directors on such Board (after giving effect
to any increase in the size of such Board pursuant to this Section 1.04)
multiplied by the percentage that the number of Shares beneficially owned by
Purchaser at such time (including Shares so accepted for payment) bears to the
total number of Shares then outstanding; provided that, in the event the Minimum
Condition shall have been satisfied, in no event shall the Parent Designees
constitute less than a majority of the entire Board of Directors. In furtherance
thereof, the Company shall, upon the request of Parent, use its reasonable best
efforts promptly either to increase the size of its Board of Directors or to
secure the resignations of such number of its incumbent directors, or both, as
is necessary to enable the Parent Designees to be so elected or appointed to the
Company's Board of Directors, and the Company shall take all actions available
to the Company to cause the Parent Designees to be so elected or appointed. At
such time, the Company shall, if requested by Parent, also take all action
necessary to cause persons designated by Parent to constitute at least the same
percentage (rounded up to the next whole number) as is on the Company's Board of
Directors of (i) each committee of the Company's Board of Directors, (ii) each
board of directors (or similar body) of each Subsidiary (as defined in Section
9.02) of the Company and (iii) each committee (or similar body) of each such
board.
(b) The Company's obligation to appoint Parent Designees to
the Company's Board of Directors shall be subject to Section 14(f) of the
Exchange Act and Rule 14f-1 promulgated thereunder. The Company shall promptly
take all actions required pursuant to Section 14(f) of the Exchange Act and Rule
14f-1 promulgated thereunder in order to fulfill its obligations under Section
1.04(a), including mailing to stockholders the information required by such
Section 14(f) and Rule 14f-1 (or including such information in the Schedule
14D-9 initially filed with the SEC and distributed to the stockholders of the
Company) as is necessary to enable Parent Designees to be elected to the
Company's Board of Directors. Parent or Purchaser will supply to the Company in
writing and be solely responsible for any information with respect to Parent and
Purchaser and their nominees, officers, directors and affiliates to the extent
required by such Section 14(f) and Rule 14f-1. The provisions of this Section
1.04 are in addition to and shall not limit any rights which Purchaser, Parent
or any of their affiliates may have as a holder or beneficial owner of Shares as
a matter of applicable law with respect to the election of directors or
otherwise.
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(c) Notwithstanding the provisions of this Section 1.04, the
parties hereto shall use their respective best efforts to ensure that at least
two of the members of the Board shall, at all times prior to the Effective Time
(as defined in Section 2.03), be directors of the Company who were directors of
the Company on the date hereof (the "Continuing Directors"), provided that, if
there shall be in office fewer than two Continuing Directors for any reason, the
Board of Directors shall cause the person designated by the remaining Continuing
Director to fill such vacancy who shall be deemed to be a Continuing Director
for all purposes of this Agreement, or if no Continuing Directors then remain,
the other directors of the Company then in office shall designate two persons to
fill such vacancies who will not be officers or employees or affiliates of the
Company or Parent or any of their respective subsidiaries and such persons shall
be deemed to be Continuing Directors for all purposes of this Agreement. From
and after the time, if any, that the Parent Designees constitute a majority of
the Company's Board of Directors and prior to the Effective Time, subject to the
terms hereof, any amendment or modification of this Agreement, any amendment to
the Company's restated certificate of incorporation or by-laws, any termination
of this Agreement by the Company, any extension of time for performance of any
of the obligations of Parent or Purchaser hereunder, any waiver of any condition
to the Company's obligations hereunder or any of the Company's rights hereunder
or other action by the Company hereunder which adversely affects the holders of
Shares other than Parent or Purchaser may be effected only if there are in
office one or more Continuing Directors and such action is approved by the
action of unanimous vote of the entire Board of Directors of the Company.
ARTICLE II
THE MERGER
SECTION 2.01 The Merger. On the terms and subject to the
conditions set forth in this Agreement, and in accordance with the DGCL, the
Merger shall be effected and Purchaser shall be merged with and into the Company
at the Effective Time. At the Effective Time, the separate corporate existence
of Purchaser shall cease and the Company shall continue as the surviving
corporation of the Merger (as such, the "Surviving Corporation") and shall
continue to be governed by the laws of the State of Delaware.
SECTION 2.02 Closing. Unless this Agreement shall have been
terminated and the transactions contemplated hereby shall have been abandoned
pursuant to Article VIII, and subject to the satisfaction or waiver of the
conditions set forth in Article VII, the closing of the Merger (the "Closing")
will take place as soon as practicable, but in no event later than 10:00 a.m. on
the second Business Day (the "Closing Date") following satisfaction or waiver of
all of the conditions set forth in Article VII, other than those conditions that
by their nature are to be satisfied at the Closing, but subject to the
fulfillment or waiver of those conditions, at the offices of Shearman &
Sterling, 599 Lexington Avenue, New York, New York 10022, unless another date,
time or place is agreed to in writing by the parties hereto.
SECTION 2.03 Effective Time. On the Closing Date (or on such
other date as Parent and the Company may agree), the parties hereto shall file
with the Secretary of State of the State of Delaware a certificate of merger or,
if applicable, a certificate of ownership and merger (in either case, the
"Certificate of Merger") and any other appropriate documents,
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executed in accordance with the relevant provisions of the DGCL, and shall make
all other filings or recordings in such form as is required by, and executed in
accordance with, the DGCL and other applicable law in connection with the
Merger. The Merger shall become effective upon the filing of the Certificate of
Merger with the Secretary of State of the State of Delaware, or at such later
time as is mutually agreed by the parties and set forth therein (the "Effective
Time").
SECTION 2.04 Effects of the Merger. At the Effective Time, the
Merger shall have the effects set forth in the applicable provisions of the
DGCL. Without limiting the generality of the foregoing, and subject thereto, at
the Effective Time, all property, rights, privileges, powers and franchises of
the Company and Purchaser shall vest in the Surviving Corporation, and all
debts, liabilities, obligations, restrictions, disabilities and duties of the
Company and Purchaser shall become the debts, liabilities, obligations,
restrictions, disabilities and duties of the Surviving Corporation.
SECTION 2.05 Certificate of Incorporation; By-Laws. (a) At the
Effective Time, subject to Section 6.08(a), the restated certificate of
incorporation of the Company shall be the certificate of incorporation of the
Surviving Corporation until thereafter changed or amended in accordance with the
provisions thereof and applicable law.
(b) The by-laws of the Company shall be the by-laws of the
Surviving Corporation until thereafter changed or amended in accordance with the
provisions thereof and applicable law.
SECTION 2.06 Directors; Officers. From and after the Effective
Time, (a) the directors of Purchaser immediately prior to the Effective Time
shall be the initial directors of the Surviving Corporation, until the earlier
of (i) their resignation or removal or (ii) the time at which their respective
successors are duly elected and qualified, as the case may be, and (b) the
officers of the Company immediately prior to the Effective Time shall be the
initial officers of the Surviving Corporation, until the earlier of (i) their
resignation or removal or (ii) the time at which their respective successors are
duly elected and qualified, as the case may be.
SECTION 2.07 Effect on Capital Stock. At the Effective Time,
by virtue of the Merger and without any action on the part of Parent, Purchaser,
the Company or any holder of Shares or any other shares of capital stock of the
Company or Purchaser:
(a) Common Stock of Purchaser. Each share of common
stock, par value $0.01 per share, of Purchaser issued and outstanding
immediately prior to the Effective Time shall be converted into and
become one validly issued, fully paid and nonassessable share of common
stock, par value $0.01 per share, of the Surviving Corporation.
(b) Cancellation of Treasury Shares and Parent-Owned
Shares. Each Share issued and outstanding immediately prior to the
Effective Time that is owned by the Company or any Subsidiary of the
Company or by Parent, Purchaser or any other Subsidiary of Parent
(other than shares in trust accounts, managed accounts, custodial
accounts and the like that are beneficially owned by third parties)
shall automatically be
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canceled and shall cease to exist, and no cash or other consideration
shall be delivered or deliverable in exchange therefor.
(c) Conversion of Shares. Each Share issued and
outstanding immediately prior to the Effective Time (other than Shares
to be canceled in accordance with Section 2.07(b) and any Dissenting
Shares (as defined in Section 2.07(d)) shall be converted into the
right to receive the Offer Consideration, payable to the holder
thereof, without any interest thereon (the "Merger Consideration"),
less any required withholding Taxes (as defined in Section 3.14(b)),
upon surrender and exchange of a Certificate (as defined in Section
2.09(b)).
(d) Dissenting Shares. Notwithstanding anything in this
Agreement to the contrary, Shares issued and outstanding immediately
prior to the Effective Time held by any person who, if applicable, has
not voted such Shares in favor of the Merger and who has the right to
demand, and who properly demands, an appraisal of such Shares
("Dissenting Shares") in accordance with Section 262 of the DGCL (or
any successor provision) shall not be converted into a right to receive
the Merger Consideration unless such holder fails to perfect or
otherwise loses such holder's right to such appraisal, if any. If,
after the Effective Time, such holder fails to perfect or loses any
such right to appraisal, each such Share of such holder shall be
treated as a Share that had been converted as of the Effective Time
into the right to receive the Merger Consideration in accordance with
Section 2.07(c). At the Effective Time, any holder of Dissenting Shares
shall cease to have any rights with respect thereto, except the rights
provided in Section 262 of the DGCL (or any successor provision) and as
provided in the immediately preceding sentence. The Company shall give
prompt notice to Parent of any demands received by the Company for
appraisal of Shares, withdrawals of such demands, and any other
instruments served pursuant to Section 262 of the DGCL and received by
the Company. Parent shall have the right to participate in and direct
all negotiations and proceedings with respect to such demands. The
Company shall not, except with the prior written consent of Parent,
make any payment with respect to, or offer to settle, any such demands.
SECTION 2.08 Options; Stock Plans. (a) Each outstanding option
to purchase Shares (a "Stock Option") which immediately prior to the Effective
Time is not vested will accelerate and become fully vested and exercisable upon
the Effective Time in accordance with the terms of the applicable Company Stock
Option Plan (the "Accelerated Stock Options"). As of the Effective Time, each
Stock Option (including the Accelerated Stock Options) shall be canceled by the
Company and in consideration of such cancellation, the Company shall pay to each
holder of a canceled Stock Option at the Effective Time an amount (the "Option
Spread") equal to the product of (A) the excess, if any, of (i) the Merger
Consideration over (ii) the exercise price per Share of such Stock Option
multiplied by (B) the number of Shares subject to such Stock Option immediately
prior to its cancellation. The Option Spread, after reduction for any required
withholding Taxes, shall be paid in cash as promptly as practicable following
the Effective Time.
(b) As of the Effective Time, (i) each then outstanding
deferred share unit issued under the Directors' Deferred Compensation Plan shall
be cancelled and in consideration
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<PAGE> 16
of such cancellation, the holder of such deferred share unit shall receive as
promptly as practicable following the Effective Time a cash payment equal to the
number of deferred share units then held by such holder, multiplied by the
Merger Consideration, (ii) each deferred cash account established under the
Directors' Deferred Compensation Plan shall be cancelled and in consideration of
such cancellation, the participant in whose name the deferred cash account is
established shall receive as promptly as practicable following the Effective
Time a cash payment equal to the balance in such deferred cash account and (iii)
each then outstanding share of restricted stock issued under the Directors' Plan
shall be cancelled and in consideration of such cancellation, the holder of such
shares of restricted stock shall receive as promptly as practicable following
the Effective Time a cash payment equal to the number of shares of restricted
stock then held by such holder, multiplied by the Merger Consideration.
(c) The Company shall take all actions necessary to ensure
that following the Effective Time no holder of a Stock Option or any participant
in any employee incentive or benefit plans or programs or arrangements or
non-employee director plans maintained by the Company shall have any right
thereunder to acquire any capital stock of Parent or the Surviving Corporation.
SECTION 2.09 Payment for Shares. (a) Payment Fund.
Concurrently with the Effective Time, Parent shall deposit, or shall cause to be
deposited, with or for the account of a bank or trust company designated by
Parent, which shall be reasonably satisfactory to the Company (the "Paying
Agent"), for the benefit of the holders of Shares, cash in an amount sufficient
to pay the aggregate Merger Consideration payable upon the conversion of Shares
pursuant to Section 2.07(c) (the "Payment Fund").
(b) Letters of Transmittal; Surrender of Certificates. As soon
as reasonably practicable after the Effective Time, Parent shall instruct the
Paying Agent to mail to each holder of record (other than the Company or any of
its Subsidiaries or Parent, Purchaser or any other Subsidiary of Parent) of a
certificate or certificates that, immediately prior to the Effective Time,
evidenced outstanding Shares (the "Certificates"), (i) a form of letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Exchange Agent, and shall be in such form and have such
other provisions as Parent may reasonably specify) and (ii) instructions for use
in effecting the surrender of the Certificates in exchange for the Merger
Consideration. Upon surrender of a Certificate for cancellation to the Paying
Agent together with such letter of transmittal, duly executed, and such other
customary documents as may be required pursuant to such instructions, the holder
of such Certificate shall be entitled to receive in exchange therefor cash in an
amount equal to the product of (i) the number of Shares formerly represented by
such Certificate and (ii) the Merger Consideration, and the Certificate so
surrendered shall forthwith be canceled. No interest shall be paid or accrued on
any cash payable upon the surrender of any Certificate. If payment is to be made
to a person other than the person in whose name the surrendered Certificate is
registered, it shall be a condition of payment that the Certificate so
surrendered shall be properly endorsed or otherwise in proper form for transfer
and that the person requesting such payment shall pay any transfer or other
Taxes required by reason of the payment to a person other than the registered
holder of the surrendered Certificate, or establish to the satisfaction of
Parent and the Surviving Corporation that such Taxes have been paid or are not
applicable.
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(c) Cancellation of Shares; No Further Rights. As of the
Effective Time, all Shares (other than Shares to be canceled in accordance with
Section 2.07(b)) issued and outstanding immediately prior to the Effective Time
shall cease to be outstanding and shall automatically be canceled and shall
cease to exist, and each holder of any such Shares shall cease to have any
rights with respect thereto or arising therefrom (including without limitation
the right to vote), except the right to receive the Merger Consideration,
without interest, upon surrender of such Certificate in accordance with Section
2.09(b), and until so surrendered, each such Certificate shall represent for all
purposes only the right to receive the Merger Consideration (without interest),
other than in the case of Dissenting Shares. The Merger Consideration paid upon
the surrender for exchange of Certificates in accordance with the terms of this
Section 2.09 shall be deemed to have been paid in full satisfaction of all
rights pertaining to the Shares formerly represented by such Certificates. At
the close of business on the day of the Effective Time, the stock transfer books
of the Company shall be closed and thereafter there shall be no further
registration of transfers of Shares on the records of the Company.
(d) Investment of Payment Fund. The Paying Agent shall invest
the Payment Fund, as directed by Parent, in (i) direct obligations of the United
States of America, (ii) obligations for which the full faith and credit of the
United States of America is pledged to provide for the payment of principal and
interest, (iii) commercial paper rated "A-1" or "P-1" or better by Moody's
Investors Service, Inc. or Standard & Poor's Corporation, respectively, or (iv)
certificates of deposit, bank repurchase agreements or bankers' acceptances of
commercial banks with capital exceeding $500 million. Any net earnings with
respect to the Payment Fund shall be the property of and paid over to Parent as
and when requested by Parent.
(e) Termination of Payment Fund. Any portion of the Payment
Fund which remains undistributed to the holders of Certificates for 180 days
after the Effective Time shall be delivered to Parent, upon demand, and any
holders of Certificates that have not theretofore complied with this Section
2.09 shall thereafter look only to Parent, and only as general creditors
thereof, for payment of their claim for any Merger Consideration.
(f) No Liability. None of Parent, Purchaser, the Surviving
Corporation or the Paying Agent shall be liable to any person in respect of any
payments or distributions payable from the Payment Fund delivered to a public
official pursuant to any applicable abandoned property, escheat or similar law.
Subject to applicable law and public policy, if any Certificates shall not have
been surrendered prior to three years after the Effective Time (or immediately
prior to such earlier date on which any Merger Consideration in respect of such
Certificate would otherwise escheat to or become the property of any
Governmental Entity (as defined in Section 3.03(b))), any amounts payable in
respect of such Certificate shall, to the extent permitted by applicable law and
public policy, become the property of the Surviving Corporation, free and clear
of all claims or interest of any person previously entitled thereto.
(g) Withholding Rights. Parent and Purchaser shall be entitled
to deduct and withhold, or cause to be deducted or withheld, from the
consideration otherwise payable pursuant to this Agreement to any holder of
Shares, Stock Options or Certificates such amounts as are required to be
deducted and withheld with respect to the making of such payment under the
Internal Revenue Code of 1986, as amended (the "Code"), or any provision of
applicable state, local or foreign Tax law. To the extent that amounts are so
deducted and withheld, such
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<PAGE> 18
deducted and withheld amounts shall be treated for all purposes of this
Agreement as having been paid to such holders in respect of which such deduction
and withholding was made.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to Parent and the Purchaser to enter into
this Agreement, except as set forth in the corresponding sections or subsections
of the disclosure schedule delivered by the Company to Parent and Purchaser upon
or prior to entering into this Agreement (the "Disclosure Schedule"), the
Company represents and warrants to Parent and Purchaser as follows:
SECTION 3.01 Organization, Standing and Corporate Power. Each
of the Company and its Subsidiaries is duly incorporated (or if not a
corporation, duly organized), validly existing and in good standing under the
laws of the jurisdiction in which it is incorporated and has the requisite
corporate or other power and authority to carry on its business as now being
conducted. Each of the Company and its Subsidiaries is duly qualified to do
business and is in good standing in each jurisdiction in which the nature of its
business or the ownership or leasing of its properties makes such qualification
necessary, other than in such jurisdictions where the failure to be so qualified
would not, individually or in the aggregate, have a Material Adverse Effect on
the Company. For purposes of this Agreement, a "Material Adverse Effect" with
respect to any person means a material adverse effect on (a) the ability of such
person to perform its obligations under this Agreement or to consummate the
transactions contemplated hereby or (b) the financial condition, business or
results of operations of such person and its Subsidiaries taken as a whole,
other than any change, circumstance or effect relating to (i) the economy or
securities markets in general, (ii) the industries in which such person operates
and not specifically relating to such person, (iii) the performance of this
Agreement or the transactions contemplated hereby in accordance with the terms
of this Agreement or (iv) any development relating to the action commenced by
Information Resources, Inc. on July 29, 1996 in the United States District Court
for the Southern District of New York, naming as defendants The Dun & Bradstreet
Corporation, A.C. Nielsen Company (a subsidiary of the Company) and I.M.S.
International, Inc., and any related proceedings. The Company has delivered or
made available to Parent true, complete and correct copies of the certificate of
incorporation and by-laws or comparable governing documents of the Company, as
amended or restated to the date of this Agreement. Schedule B sets forth a true,
correct and complete list of all Subsidiaries of the Company required to be
reported on Exhibit 21 to the Company's Annual Report on Form 10-K. Except as
set forth in such Schedule B, all Subsidiaries of the Company required to be so
reported are wholly owned directly or indirectly by the Company. The Company
does not own, directly or indirectly, any capital stock or other equity interest
in any person other than the Subsidiaries other than such capital stock and
other equity interests with a carrying value, in the aggregate, not in excess of
$1,000,000.
SECTION 3.02 Corporate Authorization. The Company has the
requisite corporate power and authority to enter into this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by the Company and the
consummation by the Company of the transactions
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<PAGE> 19
contemplated hereby have been duly authorized, and this Agreement has been
approved, by the Board of Directors of the Company, and no other corporate
proceeding, other than with respect to the Merger the approval of the Company's
stockholders, is necessary to authorize the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by the Company and, assuming that
this Agreement constitutes a valid and binding obligation of Parent and
Purchaser, constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms. Subject to the
applicability of Section 253 of the DGCL, the affirmative vote of the holders of
a majority of the outstanding Shares is the only vote required to adopt this
Agreement and consummate the Merger.
SECTION 3.03 Consents and Approvals; No Violations. (a) The
execution and delivery by the Company of this Agreement do not, and the
consummation by the Company of the transactions contemplated hereby and
compliance by the Company with the provisions hereof will not, (i) violate any
of the provisions of the restated certificate of incorporation or by-laws of the
Company or the comparable governing documents of any Subsidiary of the Company,
in each case as amended or restated to the date of this Agreement, (ii) subject
to the governmental filings and other matters referred to in Section 3.03(b),
violate or result in a breach of or default (with or without notice or lapse of
time, or both) under, or give rise to a material obligation, right of
termination, cancellation or acceleration of any obligation or loss of a
material benefit under, or require the consent of any person under, any
indenture or other agreement, permit, concession, franchise, license or other
instrument or undertaking to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or any of their
respective assets is bound or affected or (iii) subject to the governmental
filings and other matters referred to in Section 3.03(b), violate any domestic
or foreign law, rule or regulation applicable to the Company or any order, writ,
judgment, injunction, decree, determination or award applicable to the Company
currently in effect, which, in the case of clauses (ii) and (iii) above, would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on the Company.
(b) No consent, approval, order or authorization of, or
declaration, registration or filing with, or notice to, any domestic or foreign
court, arbitral tribunal, administrative agency or commission or other
governmental agency or regulatory authority (a "Governmental Entity"), which has
not been received or made is required by or with respect to the Company or any
of its Subsidiaries in connection with the execution and delivery of this
Agreement by the Company or the consummation by the Company of the transactions
contemplated hereby, except for (i) (A) the receipt of a decision under Article
6(1)(b) or 8(2) of the EC Merger Regulation, declaring the Offer and the Merger
compatible with the European Community common market, (B) the filing of
premerger notification and report forms under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (the "HSR Act") and (C) any filings with, or approvals
or consents of, any other competent antitrust authority, (ii) the filing with
the SEC of (A) the Schedule 14D-9 and, if required by applicable law, the Proxy
Statement (as defined in Section 6.01(b)), (B) such reports under the Exchange
Act as may be required in connection with this Agreement and the transactions
contemplated hereby, (iii) the filing of the Certificate of Merger with the
Delaware Secretary of State and appropriate documents with the relevant
authorities of other states in which the Company is qualified to do business,
(iv) the pre-notification requirements under the Investment Canada Act of 1985,
(v) as required under the rules and regulations of the New York
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<PAGE> 20
Stock Exchange, Inc. (the "NYSE") and (vi) any other consents, approvals,
authorizations, filings or notices the failure to make or obtain which would
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the Company.
SECTION 3.04 Capital Structure. As of the date of this
Agreement, the authorized capital stock of the Company consists solely of (a)
150,000,000 shares of Common Stock, (b) 5,000,000 shares of series common stock,
par value $0.01 per share (the "Series Common Stock"), of which no shares were
outstanding, and (c) 5,000,000 shares of preferred stock, par value $0.01 per
share ("Preferred Stock"), of which no shares were outstanding but of which
400,000 shares have been designated as Series A Junior Participating Preferred
Stock and reserved for issuance upon exercise of the Rights distributed to the
holders of Common Stock pursuant to the Rights Agreement. At the close of
business on November 30, 2000, 57,830,966 shares of Common Stock were
outstanding, and 2,471,445 shares of Common Stock of the Company were held in
the treasury of the Company. At the close of business on November 30, 2000, no
Stock Options, warrants, shares of restricted stock, or other rights to acquire
capital stock from the Company were outstanding other than (a) the Rights, (b)
Stock Options representing in the aggregate the right to purchase up to
12,942,060 shares of Common Stock (including tandem limited stock appreciation
rights granted to senior executives of the Company) and 19,875 stock
appreciation rights under the 1996 ACNielsen Key Employees' Stock Incentive Plan
(the "Key Employees' Stock Incentive Plan"), the 1996 ACNielsen Replacement Plan
for Certain Employees Holding The Dun & Bradstreet Equity Based Awards (the
"Replacement Plan"), the 1996 ACNielsen Non-Employee Directors' Stock Incentive
Plan (the "Directors' Plan"), the 1996 ACNielsen Senior Executive Plan (the
"Executive Plan"), the 1996 ACNielsen Management Incentive Bonus Plan (the
"Management Plan") and the BBI Marketing Services Inc. Key Employee Stock Option
Plan (the "Incentive Plan") (collectively, the "Company Stock Option Plans"),
(c) stock units representing in the aggregate the right to receive no more than
30,000 shares of Common Stock under the 1996 ACNielsen Non-Employee Directors'
Deferred Compensation Plan (the "Directors' Deferred Compensation Plan") and (d)
obligations to issue shares of Common Stock under the ACNielsen Employee Stock
Ownership Plan (the "Employee Stock Ownership Plan"). Other than (a) the shares
of Common Stock (including restricted stock), Rights, Stock Options, stock units
and other rights described above), (b) Stock Options, stock units or other
rights to acquire no more than 50,000 shares of Common Stock (and accompanying
Rights) in the aggregate pursuant to the Company Stock Option Plans, and the
Directors' Deferred Compensation Plan and (c) shares of Common Stock (and
associated Rights) issued since November 30, 2000 upon the exercise of the Stock
Options referred to in clauses (b) or (c) of the immediately preceding sentence,
no shares, Stock Options or warrants or other rights to acquire capital stock
from the Company remain outstanding as of the date of this Agreement. All
outstanding shares of capital stock of the Company and its Subsidiaries are duly
authorized, validly issued, fully paid and nonassessable and not subject to
preemptive or similar rights, and, in the case of the Subsidiaries, are owned by
the Company, by one or more Subsidiaries of the Company or by the Company and
one or more such Subsidiaries (except as disclosed in Schedule B), free and
clear of all pledges, claims, liens, charges, mortgages, conditional sale or
title retention agreements, hypothecations, collateral assignments, security
interests, easements and other encumbrances of any kind or nature whatsoever
(collectively, "Liens"), except for Liens under the Three-Year Credit Agreement,
dated as of April 15, 1998, among the Company, The Chase Manhattan Bank and the
lenders named therein (the "Credit Agreement"). Except as described above,
neither the Company nor any Subsidiary of the
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Company has or is subject to or bound by or, at or after the Effective Time will
have or be subject to or bound by, any outstanding Stock Option, warrant, call,
subscription or other right (including any preemptive or similar right),
agreement or commitment which (a) obligates the Company or any Subsidiary of the
Company to issue, sell or transfer, or repurchase, redeem or otherwise acquire,
any shares of the capital stock of the Company or any Subsidiary of the Company,
(b) restricts the transfer of any shares of capital stock of the Company or any
of its Subsidiaries, or (c) relates to the holding, voting or disposition of any
shares of capital stock of the Company or any of its Subsidiaries except, in the
case of clause (b) or (c), as provided in the Credit Agreement. No bonds,
debentures, notes or other indebtedness of the Company or any Subsidiary of the
Company having the right to vote (or convertible into, or exchangeable for,
securities having the right to vote) on any matters on which the stockholders of
the Company or any Subsidiary of the Company may vote are issued or outstanding.
Section 3.04 of the Disclosure Schedule accurately sets forth information as of
November 30, 2000 regarding the exercise price, date of grant and number of
granted Stock Options and rights to purchase shares of Common Stock pursuant to
any Company Stock Option Plan, the Employee Stock Ownership Plan and the
Directors' Deferred Compensation Plan. Except as described above, there are no
other stock appreciation, phantom stock or other equity-based awards outstanding
under any employee incentive or benefit plan or program or arrangement or
non-employee director plan maintained by the Company.
SECTION 3.05 SEC Documents. The Company has filed all required
reports, schedules, forms, statements and other documents with the SEC relating
to periods commencing on or after January 1, 1998 (such reports, schedules,
forms, statements and other documents being hereinafter referred to as the "SEC
Documents"). As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Securities Act of 1933, as
amended (the "Securities Act"), or the Exchange Act, as the case may be, and the
rules and regulations of the SEC promulgated thereunder applicable to such SEC
Documents, and none of the SEC Documents as of such dates contained any untrue
statements of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The consolidated
financial statements of the Company included in the SEC Documents comply as to
form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, have been
prepared in accordance with U.S. generally accepted accounting principles
("GAAP") (except, in the case of unaudited consolidated quarterly statements, as
permitted by Form 10-Q of the SEC) applied on a consistent basis during the
periods involved (except as may otherwise be indicated in the notes thereto) and
fairly present the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the consolidated results
of their operations and cash flows for the periods then ended (subject, in the
case of unaudited quarterly statements, to normal year-end audit adjustments).
No Subsidiary is required to file any form, report or other document with the
SEC.
SECTION 3.06 Absence of Certain Changes or Events. Since
September 30, 2000, the Company and its Subsidiaries have conducted their
businesses only in the ordinary course consistent with past practice, and there
has not been: (a) any event, change, occurrence, or development of a state of
facts or circumstances having, or which would reasonably be expected to have, a
Material Adverse Effect on the Company; (b) any declaration, setting aside
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<PAGE> 22
or payment of any dividend or other distribution in respect of shares of the
Company's capital stock, or any purchase, redemption or other acquisition by the
Company of any shares of its outstanding capital stock or of any rights,
warrants or options to acquire any such shares; (c) other then in the ordinary
course consistent with past practice, any (i) grant of any severance or
termination pay to (or amendment to any such existing arrangement with) any
director, officer or employee of the Company or any of its Subsidiaries, (ii)
entering into of any employment, deferred compensation or other similar
arrangement (or any amendment to any such existing agreement) with any director,
officer or employee of the Company or any of its Subsidiaries, (iii) any
increase in benefits payable under any existing severance or termination pay
policies or employment agreements with respect to any director, officer or
employee of the Company or any of its Subsidiaries, (iv) increase in (or
amendments to the terms of) compensation, bonus or other benefits payable to
directors, officers or employees of the Company or any of its Subsidiaries, or
(v) any adoption or agreement to adopt any collective bargaining agreement or
any Company Plan or Foreign Benefit Plan (as defined hereinafter); (d) any
change by the Company or any of its Subsidiaries in accounting methods,
principles or practices, except as required by GAAP; or (e) any agreement or
commitment by the Company or any of its Subsidiaries to do any of the things
described in the preceding clauses (a) through (d) otherwise than as expressly
provided for herein.
SECTION 3.07 No Undisclosed Liabilities. Except to the extent
accrued or reserved in the Company's financial statements (including the notes
thereto) included in the SEC Documents filed and publicly available prior to the
date of this Agreement (the "Filed SEC Documents"), and unless incurred in the
ordinary course of business since the date of the most recent financial
statements included in the Filed SEC Documents, neither the Company nor any of
its Subsidiaries has any liabilities or obligations of any nature, whether
accrued, contingent, absolute or otherwise, except for those that would not
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the Company.
SECTION 3.08 Certain Information. The Schedule 14D-9 and the
Proxy Statement will contain all information which is required to be included
therein in accordance with the Exchange Act and the rules and regulations
thereunder and any other applicable law and will conform in all material
respects with the requirements of the Exchange Act and any other applicable law,
and neither the Schedule 14D-9 nor the Proxy Statement will, at the respective
times they are filed with the SEC or published, sent or given to the Company's
stockholders, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they are made,
not misleading; provided, however, that no representation or warranty is hereby
made by the Company with respect to any information supplied by Parent or
Purchaser in writing for inclusion in, or with respect to Parent or Purchaser
derived form Parent's public SEC filings which are included or incorporated by
reference in, the Schedule 14D-9 or the Proxy Statement. None of the information
supplied or to be supplied by the Company in writing for inclusion or
incorporation by reference in, or which may be deemed to be incorporated by
reference in, any of the Offer Documents will, at the respective times the Offer
Documents are filed with the SEC or published, sent or given to the Company's
stockholders, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading. If at any time prior to the Effective Time any event with respect to
the
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Company, or with respect to any information supplied by the Company in writing
for inclusion in any of the Offer Documents, shall occur which is required to be
described in an amendment of, or a supplement to, any of the Offer Documents,
the Company shall so describe the event to Parent.
SECTION 3.09 Real Property. (a) Section 3.09(a) of the
Disclosure Schedule sets forth all of the material real property owned by the
Company (the "Real Property") and its Subsidiaries and all material property
leased by the Company and its Subsidiaries (the "Leased Real Property").
(b) The Company or its Subsidiaries has good and marketable
title to each parcel of Real Property owned by the Company or its Subsidiaries
and a valid leasehold interest in all Real Property leased by the Company and
its Subsidiaries free and clear of all Liens except (i) those reflected or
reserved against in the latest balance sheet of the Company included in the
Filed SEC Documents, (ii) Taxes and general and special assessments not in
default and payable without penalty and interest, and (iii) other Liens that,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect on the Company.
(c) The Company has heretofore made available to Parent true,
correct and complete copies of all leases, subleases and other agreements
requiring annual payments of $5,000,000 or more (the "Real Property Leases"),
under which the Company or any of its Subsidiaries uses or occupies or has the
right to use or occupy, now or in the future, any real property or facility,
including all modifications, amendments and supplements thereto. Except in each
case where the failure would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on the Company: (i) all rent and
other sums and charges payable by the Company or its Subsidiaries as tenants
under the Real Property Leases are current in all material respects, and (ii) no
termination event or condition or uncured default of a material nature on the
part of the Company or any such Subsidiary or, to the Company's knowledge, the
landlord exists under any Real Property Lease.
SECTION 3.10 Intellectual Property. (a) The status of the
Company's rights in and to the "ACNielsen" name is set forth in the TAM Master
Agreement between the Company and Cognizant Corporation (now Nielsen Media
Research, Inc.) ("NMR"), the CZT/ACN Trademarks, L.L.C. Limited Liability
Company Agreement between NMR and the Company, the Intellectual Property
Agreement among The Dun & Bradstreet Corporation, NMR and the Company, all dated
as of October 28, 1996, and the Worldwide Trademark Assignment dated as of
October 29, 1996 from ACNielsen Corporation to CZT/ACN Trademarks, L.L.C.,
including all exhibits and schedules to each of them (collectively, the "IP
Contracts"), and copies of the IP Contracts have been provided or made available
to Parent.
(b) Except in each case where the failure would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the Company, (i) the Company owns or has rights to use and,
except for Intellectual Property licensed to the Company to the extent the terms
of the applicable licenses restrict transfer, transfer all Intellectual Property
that is reasonably necessary to conduct the Company's business as it is
conducted on the date hereof, in each case free and clear of all Liens, and (ii)
to the best of the Company's knowledge, the conduct of the Company's and its
Subsidiaries' business does not (A) infringe on any patent,
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trademark, copyright or other intellectual property right of any other person,
or (B) constitute a misuse or misappropriation of any trade secret, know-how,
process, proprietary information or other similar right of any other person. For
purposes of this Agreement, "Intellectual Property" shall mean all intellectual
property material to the operation or the conduct of business of the Company or
its Subsidiaries, including copyrights, trademarks, trade names, service marks,
domain names, trade dress, letters patent (including registrations or
applications for registration in any jurisdiction, and any renewals or
extensions thereof), the goodwill associated with the foregoing; confidential or
proprietary technical and business information, know-how and trade secrets, in
any jurisdiction, and any claims or causes of action arising out of or relating
to any infringement or misappropriation of any of the foregoing.
(c) The Internal MIS Systems are Euro Compliant except for
failures to be Euro Compliant that would not individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on the Company. "Euro
Compliant" means that the Internal MIS Systems will record, store, process and
present currency denominated in Euros, in the same manner, and with the same
functionality, as the Internal MIS Systems record, store, process and present
currencies denominated in U.S. Dollars and major European currencies. "Internal
MIS Systems" means any computer software and systems (including hardware,
firmware, operating system software, utilities and applications software) used
in the ordinary course of the business of the Company that process financial
information and that are material to the operation of the business of the
Company, including, where applicable, payroll, accounting, billing/receivables,
purchasing payables, inventory, asset tracking, customer service, and human
resources.
SECTION 3.11 Certain Contracts and Arrangements. Except as
disclosed in the Filed SEC Documents, neither the Company nor any of its
Subsidiaries is a party to or bound by any contracts, agreements, instruments or
understandings of the following nature (excluding contracts under which neither
the Company nor any Subsidiary has any remaining material obligation)
(collectively, the "Material Contracts"):
(a) contracts with any current or former officer or
director of the Company (other than any such officer who receives or
received during his or her last year of employment with the Company or
any of its Subsidiaries less than $200,000 in total annual cash
compensation from the Company or any of its Subsidiaries);
(b) contracts pursuant to which the Company or any of its
Subsidiaries licenses other persons to use any material Intellectual
Property (other than contracts entered into for the licensing of data
or software in the ordinary course of business);
(c) contracts other than contracts entered into in the
ordinary course of business (i) for the sale of any material amount of
the assets of the Company or any of its Subsidiaries, or (ii) for the
grant to any person of any preferential rights to purchase any material
amount of its assets;
(d) contracts that materially restrict the Company or any
of its affiliates from competing in any material line of business or
with any person in any geographical area or that materially restrict
any other person from competing with the Company or any of its
affiliates in any material line of business or in any geographical
area;
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(e) contracts that are material to the Company and that
restrict the Company or any of its Subsidiaries from disclosing any
information concerning or obtained from any other person or that
restrict any other person from disclosing any information concerning or
obtained from the Company or any of its Subsidiaries (other than
contracts entered into in the ordinary course of business consistent
with past practice);
(f) any confidentiality, nondisclosure or similar
contract that contains any "standstill" provisions or similar
restrictions on Acquisition Proposals by any third party (other than
Parent or its affiliates);
(g) contracts involving (i) the acquisition, merger or
purchase of all or substantially all of the assets or business of a
third party involving aggregate consideration of $5,000,000 or more or
(ii) the purchase or sale of assets, or a series of purchases and sales
of assets, involving aggregate consideration of $5,000,000 or more;
(h) contracts with any affiliate that would be required
to be disclosed under Item 404 of Regulation S-K under the Securities
Act;
(i) contracts that are material to the Company and
contain a "change in control" or similar provision;
(j) contracts, including mortgages or other grants of
security interests, guarantees and notes, relating to the borrowing of
money in an aggregate amount in excess of $5,000,000 in the aggregate;
(k) contracts relating to any material joint venture,
partnership, strategic alliance or similar arrangement; and
(l) contracts existing on the date hereof involving
revenues in excess of $10,000,000 per year.
Except as would not reasonably be expected to have a Material Adverse Effect on
the Company, neither the Company nor any of its Subsidiaries is in breach or
default under any Material Contract nor, to the knowledge of the Company, is any
other party to any Material Contract in breach or default thereunder.
SECTION 3.12 Litigation; Compliance with Laws. (a) Except as
set forth in the Filed SEC Documents, (i) there is no suit, claim, action,
proceeding (at law or in equity) or investigation pending or, to the knowledge
of the Company, threatened against or affecting the Company or any of its
Subsidiaries or any of their respective properties before any arbitrator, court
or other Governmental Entity, and (b) neither the Company nor any of its
Subsidiaries is subject to any outstanding order, writ, judgment, injunction,
decree or arbitration order or award that, in any such case described in clauses
(a) and (b), has had or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect on the Company. As of the date hereof,
there are no suits, claims, actions, proceedings or investigations pending or,
to the knowledge of the Company, threatened, seeking to prevent, hinder, modify
or challenge the transactions contemplated by this Agreement.
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(b) Except as would not reasonably be expected to have a
Material Adverse Effect on the Company, the Company and its Subsidiaries are in
compliance with all applicable statutes, laws, ordinances, rules, orders and
regulations of any Governmental Entity and have not received notification of any
asserted present or past failure to so comply. All federal, state, local and
foreign governmental approvals, authorizations, certificates, filings,
franchises, licenses, notices, permits and rights ("Permits") necessary for each
of the Company and its Subsidiaries to own, lease or operate its properties and
assets and to carry on its business as now conducted have been obtained or made,
and there has occurred no default under any such Permit, except for the lack of
Permits and for defaults under Permits which lack or default would not
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the Company.
SECTION 3.13 Environmental Laws. (a) The Company and each of
its Subsidiaries is in compliance with all applicable Environmental Laws (which
compliance includes, but is not limited to, the possession by the Company and
each of its Subsidiaries of all permits and other governmental authorizations
required under applicable Environmental Laws, and compliance with the terms and
conditions thereof), except where failure to be in compliance would not have a
Material Adverse Effect on the Company. Neither the Company nor any of its
Subsidiaries has received any written communication from a Governmental Entity
alleging that the Company or any of its Subsidiaries is not in such compliance,
other than such events of noncompliance as would not reasonably be expected to
have a Material Adverse Effect.
(b) There is no Environmental Claim pending or, to the
knowledge of the Company, threatened against the Company or any of its
Subsidiaries or, to the knowledge of the Company, against any person or entity
whose liability for any Environmental Claim the Company or any of its
Subsidiaries has or may have retained or assumed either contractually or by
operation of law which would reasonably be expected to have a Material Adverse
Effect on the Company.
(c) There are no past or present actions, activities,
circumstances, conditions, events or incidents, including, without limitation,
the Release or presence of any Hazardous Materials, which would reasonably be
expected to form the basis of any Environmental Claim against the Company or any
of its Subsidiaries or, to the knowledge of the Company, against any person or
entity whose liability for any Environmental Claim the Company or any of its
Subsidiaries has or would reasonably be expected to have retained or assumed
either contractually or by operation of law which, in any case, would reasonably
be expected to have a Material Adverse Effect on the Company.
(d) "Environmental Claim" means any claim, action, cause of
action, investigation or written notice by any person or entity alleging
potential liability (including, without limitation, potential liability for
investigatory costs, cleanup costs, governmental response costs, natural
resources damages, property damages, personal injuries, or penalties) arising
out of, based on or resulting from (i) the presence, or Release of any Hazardous
Materials at any location, whether or not owned or operated by the Company and
each of its Subsidiaries, or (ii) circumstances forming the basis of any
violation, or alleged violation, of any Environmental Law.
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(e) "Environmental Laws" means all federal, state, local and
foreign laws and regulations relating to pollution or protection of the
environment or human health as affected by the environment including, without
limitation, laws relating to Releases or threatened Releases of Hazardous
Materials or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, Release, disposal, transport or handling of Hazardous
Materials and all laws and regulations with regard to record keeping,
notification, disclosure and reporting requirements respecting Hazardous
Materials.
(f) "Hazardous Materials" means all substances defined as
Hazardous Substances, Oils, Pollutants or Contaminants in the National Oil and
Hazardous Substances Pollution Contingency Plan, 40 C.F.R. Section 300.5, or
defined as such by, or regulated as such under, any Environmental Law.
(g) "Release" means any release, spill, emission, discharge,
leaking, pumping, injection, deposit, disposal, dispersal, leaching or migration
of Hazardous Materials into the indoor or outdoor environment (including,
without limitation, ambient air, surface water, groundwater and surface or
subsurface strata) or into or out of any property, including the movement of
Hazardous Materials through or in the air, soil, surface water, groundwater or
property.
SECTION 3.14 Taxes. (a) Except as disclosed in the Filed SEC
Reports, as of the date hereof and as of the Effective Time:
(i) Except where the failure to do so would not have a
Material Adverse Effect on the Company, each of the Company and each
Subsidiary of the Company (and any affiliated or unitary group of which
any such person was a member) has timely filed, taking into account any
proper extensions, all federal, state, local and foreign returns,
declarations, reports, estimates, information returns and statements,
including combined unitary or consolidated returns for any group of
entities (the "Returns") required to be filed by or for it in respect
of any Taxes (as hereinafter defined) and has caused such Returns as so
filed to be true, correct and complete, established reserves that are
reflected in the Company's most recent financial statements included in
the Filed SEC Documents and that as so reflected are adequate for the
payment of all Taxes not yet due and payable with respect to the
results of operations of the Company and its Subsidiaries through the
date hereof and timely withheld and paid over to the proper taxing
authorities all Taxes and other amounts required to be so withheld and
paid over. Each of the Company and each Subsidiary of the Company (and
any affiliated or unitary group of which any such person was a member)
has timely paid, or has had paid on its behalf, (x) all Taxes that have
or had become due and payable with respect to taxable periods or
portions thereof beginning after October 31, 1996, except for those
contested in good faith and for which adequate reserves have been
provided in the Company's financial statements and (y) all Taxes with
respect to taxable periods or portions thereof ending on or before
October 31, 1996 for which the Company is liable under the Tax
Allocation Agreement dated as of October 29, 1996 among The Dun &
Bradstreet Corporation, Cognizant Corporation and the Company, except
for those contested in good faith and for which adequate reserves have
been provided in the Company's financial statements.
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(ii) Neither the Company nor any of its Subsidiaries has made
an election under Section 341(f) of the Code or agreed to have Section
341(f)(2) of the Code apply to any disposition of a "subsection (f)
asset" (as such term is defined in Section 341(f)(4) of the Code) owned
by the Company or any of its Subsidiaries.
(iii) Neither the Company nor any of its Subsidiaries is a
party to, is bound by or has any obligation under any Tax sharing
agreement or similar agreement or arrangement.
(iv) Since November 1, 1996, neither the Company nor any of
its Subsidiaries has agreed to make, nor is required to make, any
material adjustment under Section 481(a) of the Code by reason of a
change in accounting method or otherwise and, to the knowledge of the
Company, the Internal Revenue Service has not proposed any adjustment
or change in an accounting method of the Company or any of its
Subsidiaries.
(v) Neither the Company nor any of its Subsidiaries is, or has
been, a United States real property holding corporation within the
meaning of Section 897(c)(2) of the Code during the applicable period
set forth in Section 897(c)(1)(A)(ii) of the Code.
(vi) Except as would not have a Material Adverse Effect, there
are no Tax liens upon any asset of the Company or any of its
Subsidiaries except liens for Taxes not yet due.
(vii) Since November 1, 1996, neither the Company nor any of
its Subsidiaries has made a disclosure on a Return with respect to the
Company or any Subsidiary pursuant to Section 6662 of the Code.
(viii) The Dun & Bradstreet Corporation received a ruling from
the Internal Revenue Service that the November 1, 1996 spin-off of the
Company by The Dun & Bradstreet Corporation was a Tax-free spin-off
(the "IRS ruling") and the Company has taken no action that is, and
nothing contemplated by this Agreement would materially conflict with
or be, inconsistent with any of the representations or statements made
by the Company to the Internal Revenue Service in connection with the
IRS ruling.
(b) For purposes of this Agreement, "Taxes" means all federal,
state, local and foreign income, property, sales, excise, employment, payroll,
franchise, withholding and other taxes, tariffs, charges, fees, levies, imposts,
duties, licenses or other assessments of every kind and description, together
with any interest and any penalties, additions to tax or additional amounts
imposed by any taxing authority.
SECTION 3.15 Benefit Plans. Section 3.15 of the Disclosure
Schedule sets forth a true, correct and complete list of all material "employee
benefit plans" (as that phrase is defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) in each case, that
is sponsored, maintained or contributed to or required to be contributed to by
the Company or by any trade or business, whether or not incorporated (an "ERISA
Affiliate"), that together with the Company would be deemed a "single employer"
within the meaning of Section 4001(b) of ERISA, or to which the Company or an
ERISA Affiliate is party, whether written or oral, for the benefit of any
current or former United States
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employee, officer or director of the Company or any of its Subsidiaries (the
"Company ERISA Plans") and any other material benefit or compensation plan,
program or arrangement, in each case, that is sponsored, maintained or
contributed to or required to be contributed to by the Company or an ERISA
Affiliate, whether written or oral, for the benefit of any current or former
United States employee, officer or director of the Company or any of its
Subsidiaries (the Company ERISA Plans and such other plans being referred to as
the "Company Plans"). The Company has furnished or made available to Parent and
its representatives a true, correct and complete copy of each Company Plan and
each material document prepared in connection with each Company Plan including,
without limitation, any summary plan descriptions and notifications to
employees, a written description of any Company Plan for which there is no
written document and, except with respect to Company Plans maintained by Market
Decisions, Inc. and BBI Marketing Services, Inc., the most recent annual
reports, determination letters, financial statements and actuarial valuations
with respect to each Company Plan. Except where the failure to comply would not
reasonably be expected to have a Material Adverse Effect:
(a) none of the Company ERISA Plans is a "multiemployer plan"
within the meaning of ERISA;
(b) none of the Company Plans promises or provides retiree
health benefits or retiree life insurance benefits to any person;
(c) none of the Company Plans provides for payment of a
benefit, the increase of a benefit amount, the payment of a contingent
benefit or the acceleration of the payment or vesting of a benefit
determined or occasioned, in whole or in part, by reason of the
execution of this Agreement or the consummation of the transactions
contemplated by this Agreement;
(d) neither the Company nor any of its Subsidiaries has an
obligation to adopt, or is considering the adoption of, any new benefit
or compensation plan, program or arrangement or, except as required by
law, the amendment of an existing Company Plan;
(e) each Company ERISA Plan intended to be qualified under
Section 401(a) of the Code has received a favorable determination
notification, advisory and/or opinion letter, as applicable, from the
Internal Revenue Service, covering all of the provisions applicable to
the Company ERISA Plan for which such letters are currently available,
that it is so qualified, or otherwise meets the applicable
qualification requirements of Section 401(a) of the Code, and nothing
has occurred since the date of such letter that would reasonably be
expected to affect the qualified status of such Company ERISA Plan;
(f) each Company Plan has been operated in accordance with its
terms and the requirements of all applicable laws, regulations and
rules, including, without limitation, ERISA and the Code, and no
prohibited transaction described in Section 406 of ERISA or Section
4975 of the Code has occurred with respect to any the Company ERISA
Plan;
(g) neither the Company nor any of its Subsidiaries or members
of their "controlled group" has incurred at any time any direct or
indirect liability under ERISA
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or the Code including, without limitation, any liability in connection
with the termination of, withdrawal from or failure to fund, any
Company ERISA Plan or other retirement plan or arrangement (including
any "multiemployer plans"), and no fact or event exists that would
reasonably be expected to give rise to any such liability;
(h) the aggregate accumulated benefit obligations of each
Company ERISA Plan subject to Title IV of ERISA (as of the date of the
most recent actuarial valuation prepared for such Company ERISA Plan
and based on the discount rate and other actuarial assumptions used in
such valuation) do not exceed the fair market value of the assets of
such Company ERISA Plan (as of the date of such valuation);
(i) the Company is not aware of any claims relating to the
Company Plans, other than routine claims for benefits;
(j) none of the Company Plans provides for benefits or other
participation therein, and the Company has received no claims or
demands for participation in or benefits under any Company Plan, by any
individual classified or treated by the Company as an independent
contractor;
(k) all contributions, premiums or payments required to be
made with respect to any Company Plan have been made and, where
permitted, all such contributions, premiums or payments have been fully
deducted for income Tax purposes;
(l) the Company has performed all obligations required to be
performed by it under, and is not in any respect in default under or in
violation of and has no knowledge of any default or violation by any
party to, any Company Plan;
(m) neither the Company nor any Subsidiary is a party to any
agreement, contract, arrangement or plan that has resulted, or would
result, separately or in the aggregate, in the payment of any "excess
parachute payments" within the meaning of Section 280G of the Code as a
result of any transaction or event contemplated by this Agreement; and
(n) with respect to each employee benefit or compensation
plan, program or arrangement that is sponsored, maintained, contributed
to or required to be contributed to by the Company, whether written or
oral, for the benefit of any current or former employee, officer or
director of the Company and its Subsidiaries and that is not subject to
United States law (a "Foreign Benefit Plan"):
(i) all employer and employee contributions to each
Foreign Benefit Plan required by the applicable governing law
or by the terms of such Foreign Benefit Plan have been made
or, if applicable, accrued in accordance with normal
accounting practices;
(ii) the fair market value of the assets of each
funded Foreign Benefit Plan, the liability of each insurer for
any Foreign Benefit Plan funded through insurance or the book
reserve established for any Foreign Benefit Plan, together
with any accrued contributions, is sufficient to procure or
provide for the accrued
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benefit obligations, as of the date of this Agreement, with
respect to all current and former participants in such plan
according to the actuarial assumptions and valuations most
recently used to determine employer contributions to such
Foreign Benefit Plan and no transaction contemplated by this
Agreement shall cause such assets or insurance obligations to
be less than such benefit obligations;
(iii) each Foreign Benefit Plan has been operated in
accordance with its terms and the requirements of all
applicable laws; and
(iv) each Foreign Benefit Plan required to be
registered has been registered and has been maintained in good
standing with applicable regulatory authorities.
SECTION 3.16 Labor Matters. Neither the Company nor any of its
Subsidiaries is a party to any labor or collective bargaining agreement which
pertains to employees of the Company or any of its Subsidiaries. Except as set
forth in Section 3.16 of the Disclosure Schedule and except as would not
reasonably be expected to have a Material Adverse Effect on the Company, (a) no
employees of the Company or any of its Subsidiaries are represented by any labor
organization and, to the knowledge of the Company, no labor organization or
group of employees of the Company or any of its Subsidiaries has made a pending
demand for recognition or certification, (b) there are no representation or
certification proceedings or petitions seeking a representation proceeding
presently pending or, to the knowledge of the Company, threatened in writing to
be brought or filed with the National Labor Relations Board or any other labor
relations tribunal or authority, (c) to the knowledge of the Company, there are
no organizing activities involving the Company or any of its Subsidiaries
pending with any labor organization or group of employees of the Company or any
of its Subsidiaries, (d) the Company is in compliance with all applicable laws
relating to the employment of labor, including those related to wages, hours,
collective bargaining, worker classification and the payment and withholding of
Taxes and other sums as required by the appropriate Governmental Entity, and (e)
there are no (i) unfair labor practice charges, grievances or complaints pending
or, to the knowledge of the Company, threatened in writing by or on behalf of
any employee or group of employees of the Company or any of its Subsidiaries, or
(ii) complaints, charges or claims against the Company or any of its
Subsidiaries pending, or, to the knowledge of the Company, threatened in writing
to be brought or filed, with any Governmental Entity or arbitrator based on,
arising out of, in connection with, or otherwise relating to the employment or
termination of employment of any individual by the Company or any of its
Subsidiaries.
SECTION 3.17 Opinion of Financial Advisor. The Company has
received the written opinion of Evercore Group Inc., dated December 17, 2000 (a
true, correct and complete copy of which will be promptly delivered to Parent by
the Company), to the effect that, based upon and subject to the matters set
forth therein and as of the date thereof, the Offer Consideration and the Merger
Consideration to be received by the holders of Shares (other than Parent and
Purchaser) in the Offer and the Merger, respectively, is fair, from a financial
point of view, to such holders, and such opinion has not been withdrawn or
modified.
SECTION 3.18 Voting Requirements. In the event that Section
253 of the DGCL is inapplicable and unavailable to effectuate the Merger, the
affirmative vote of the
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holders of a majority of the outstanding Shares entitled to vote at the
Stockholders Meeting with respect to the adoption of this Agreement is the only
vote of the holders of any class or series of the Company's capital stock or
other securities required in connection with the consummation by the Company of
the Merger and the other transactions contemplated hereby to be consummated by
the Company. The Board of Directors has taken all necessary actions so that the
restrictions on "business combinations" (as defined in Section 203 of the DGCL)
set forth in Section 203 of the DGCL are not applicable to this Agreement and
the transactions contemplated hereby, including the Offer and the Merger. No
other state takeover statute or similar statute applies or purports to apply to
the Offer, the Merger or the other transactions contemplated hereby.
SECTION 3.19 Rights Agreement. The Company has amended its
Rights Agreement (the "Rights Amendment") to ensure that (a) neither a
"Distribution Date" nor a "Stock Acquisition Date" (in each case as defined in
the Rights Agreement) will occur, and none of Parent or Purchaser or any of
their "Affiliates" or "Associates" will be deemed to be an "Acquiring Person"
(in each case as defined in the Rights Agreement), by reason of the execution
and delivery of this Agreement or the consummation of the transactions to be
effected pursuant to this Agreement, and (b) the Rights will expire immediately
prior to the consummation of the Offer. The Rights Amendment is sufficient to
render the Rights inoperative with respect to (i) the acquisition of Shares by
Parent, Purchaser or their affiliates pursuant to this Agreement and the Offer
and (ii) the Merger. A true and correct copy of the Rights Amendment has been
delivered or made available to Parent.
SECTION 3.20 Brokers. No broker, investment banker, financial
advisor or other person, other than Evercore Group Inc., the fees and expenses
of which will be paid by the Company, is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
the Company or any of its Subsidiaries. A complete and accurate copy of the
Evercore Group Inc. engagement letter has been provided or made available to
Parent.
SECTION 3.21 Executive Agreements. The Executive Agreements
are in full force and effect. There has been no breach of, or default (or an
event which with notice or lapse of time or both would become a default) under
the Executive Agreements which would give to others any right of termination,
amendment, acceleration or cancellation of the Executive Agreements.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER
As an inducement to the Company to enter into this Agreement,
Parent and Purchaser hereby, jointly and severally, represent and warrant to the
Company as follows:
SECTION 4.01 Organization, Standing and Corporate Power. Each
of Parent and Purchaser is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction in which it is incorporated
and has all requisite corporate power and authority to carry on its business as
now being conducted and is duly qualified to do business and is in good standing
in each jurisdiction in which the nature of its business or the ownership or
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leasing of its properties makes such qualification necessary other than in such
jurisdictions where the failure to be so qualified would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect on
Parent or Purchaser, taken as a whole. Parent has delivered or made available to
the Company complete and correct copies of the certificate of incorporation and
by-laws (or equivalent organizational documents) of Parent and Purchaser, in
each case as in effect on the date hereof.
SECTION 4.02 Corporate Authorization. Each of Parent and
Purchaser has the requisite corporate power and authority to enter into this
Agreement, to perform its obligations hereunder and to contemplate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Parent and Purchaser and the consummation by Parent and Purchaser of the
transactions contemplated hereby have been duly authorized by the sole
stockholder of each of Parent and Purchaser, and no other corporate proceedings
on the part of Parent or Purchaser are necessary to authorize this Agreement, or
to consummate the transactions contemplated hereby. This Agreement has been duly
executed and delivered by each of Parent and Purchaser and, assuming this
Agreement constitutes a valid and binding obligation of the Company, constitutes
a valid and binding obligation of each of Parent and Purchaser, enforceable
against each such party in accordance with its terms.
SECTION 4.03 Consents and Approvals; No Violations. (a) The
execution and delivery of this Agreement by Parent and Purchaser do not, and the
consummation of the transactions contemplated hereby and compliance with the
provisions hereof will not (i) violate any of the provisions of the certificate
of incorporation or by-laws of Parent or Purchaser or any of their respective
Subsidiaries, in each case as amended or restated to the date of this Agreement,
(ii) subject to the governmental filings and other matters referred to in
Section 4.03(b), violate, result in a breach of or default (with or without
notice or lapse of time, or both) under, or give rise to a material obligation,
a right of termination, cancellation or acceleration of any obligation or loss
of a material benefit under, or require the consent of any person under, any
indenture, or other agreement, permit, concession, franchise, license or other
instrument or undertaking to which Parent, Purchaser or any of their respective
Subsidiaries is a party or by which Parent, Purchaser or any of their respective
Subsidiaries or any of their respective assets is bound or affected other than
the Positive Advice or Acceptable Conditional Advice of the Works' Council (each
as defined in Exhibit A), or (iii) subject to the governmental filings and other
matters referred to in Section 4.03(b), violate any law, rule or regulation
applicable to Parent and Purchaser, or any order, writ, judgment, injunction,
decree, determination or award applicable to Parent and Purchaser currently in
effect, which, in the case of clauses (ii) and (iii) above, could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on
Parent or Purchaser taken as a whole.
(b) No consent, approval, order or authorization of, or
declaration, registration or filing with, or notice to, any Governmental Entity
which has not been received or made is required by or with respect to Parent or
Purchaser or any of their respective Subsidiaries in connection with the
execution and delivery of this Agreement by Parent or Purchaser or the
consummation by Parent, Purchaser of any of the transactions contemplated
hereby, except for (i) (A) the receipt of a decision under the EC Merger
Regulation declaring the Offer and the Merger compatible with the European
Community common market, (B) the filing of premerger notification and report
forms under the HSR Act and, if required, the CAC and (C) any filings
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with, or approvals or consents of, any other competent antitrust authority, (ii)
those filings required under the Investment Canada Act of 1985, (iii) the filing
with the SEC of (A) the Offer Documents and (B) such reports under the Exchange
Act as may be required in connection with this Agreement and the transactions
contemplated hereby, (iv) the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware and appropriate documents with the
relevant authorities of other states in which the Company is qualified to do
business and (v) any other consents, approvals, authorizations, filings or
notices the failure to make or obtain which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on Parent or
Purchaser, taken as a whole.
SECTION 4.04 Certain Information. Subject to the Company's
fulfillment of its obligations hereunder with respect thereto, the Offer
Documents will contain (or will be amended in a timely manner so as to contain)
all information which is required to be included therein in accordance with the
Exchange Act and the rules and regulations thereunder and any other applicable
law and will conform in all material respects with the requirements of the
Exchange Act and any other applicable law, and the Offer Documents will not, at
the respective times they are filed with the SEC or published, sent or given to
the Company's stockholders, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading; provided, however, that no representation or
warranty is hereby made by Parent or Purchaser with respect to any information
supplied by the Company in writing for inclusion in, or with respect to the
Company information derived from the Company's public SEC filings which is
included or incorporated by reference in the Offer Documents. None of the
information supplied or to be supplied by Parent or Purchaser for inclusion or
incorporation by reference in, or which may be deemed to be incorporated by
reference in, the Schedule 14D-9 or the Proxy Statement will, at the respective
times the Schedule 14D-9 and the Proxy Statement are filed with the SEC or
published, sent or given to the Company's stockholders, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading. If at any time prior to
the Effective Time any event with respect to Parent or Purchaser, or with
respect to any information supplied by Parent or Purchaser for inclusion in the
Schedule 14D-9 or the Proxy Statement, shall occur which is required to be
described in an amendment of, or a supplement to, such document, Parent or
Purchaser shall so describe the event to the Company.
SECTION 4.05 Vote Required. No vote of the holders of any
class or series of capital stock of Parent is necessary to approve this
Agreement, the Offer, the Merger or the other transactions contemplated hereby.
SECTION 4.06 No Business Activities. Purchaser has not
conducted any activities other than in connection with its organization, the
negotiation and execution of this Agreement and the consummation of the
transactions contemplated hereby.
SECTION 4.07 No Company Capital Stock. Neither Parent nor any
of its Subsidiaries owns or holds, directly or indirectly, any Shares or any
other capital stock of the Company, or any options, warrants or other rights to
acquire any Shares or any other capital stock of the Company, or, in each case,
any interests therein.
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SECTION 4.08 Sufficient Funds. At the Closing, Purchaser will
have sufficient funds to enable Purchaser to pay in full (a) the Offer
Consideration, (b) the Merger Consideration, (c) any existing indebtedness that
is required to be repaid as a result of the transactions contemplated hereby,
including the financing thereof, and (d) all fees and expenses payable by Parent
and Purchaser in connection with this Agreement and the transactions
contemplated hereby. Parent has entered into a binding revolving credit facility
agreement under which, if the condition set forth in clause (c) of Exhibit A is
satisfied, such funds will be available at the Closing.
ARTICLE V
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 5.01 Conduct of Business of the Company. Except as
expressly provided for herein, during the period from the date of this Agreement
to the Effective Time, the Company shall, and shall cause each of its
Subsidiaries to, act and carry on its business in the ordinary course of
business consistent with past practice and, to the extent consistent therewith,
use its reasonable best efforts to preserve intact its current business
organizations, keep available the services of its current key officers and
employees and preserve the goodwill of those engaged in material business
relationships with the Company. Without limiting the generality of the
foregoing, except as expressly provided herein, the Company shall not, and shall
not permit any of its Subsidiaries to, without the prior consent of Parent:
(a) except as set forth in Section 5.01(a) of the Disclosure
Schedule, (i) declare, set aside or pay any dividends on, or make any
other distributions (whether in cash, securities or other property) in
respect of, any of its outstanding capital stock (other than, with
respect to a Subsidiary of the Company, to its corporate parent), (ii)
split, combine or reclassify any of its outstanding capital stock or
issue or authorize the issuance of any other securities in respect of,
in lieu of or in substitution for shares of its outstanding capital
stock, or (iii) purchase, redeem or otherwise acquire any shares of
outstanding capital stock or any rights, warrants or options to acquire
any such shares, except, in the case of this clause (iii), for the
acquisition of Shares from holders of Stock Options in full or partial
payment of the exercise price or any Taxes payable by such holder upon
exercise of Stock Options to the extent required under the terms of
such Stock Options as in effect on the date hereof;
(b) except as set forth in Section 5.01(b) of the Disclosure
Schedule, issue, sell, grant, pledge or otherwise encumber any shares
of its capital stock, any other voting securities or any securities
convertible into or exchangeable for, or any rights, warrants or
options to acquire, any such shares, voting securities or convertible
or exchangeable securities, other than (i) upon the exercise of Vested
Stock Options outstanding on the date of this Agreement and (ii) the
issuance of Shares as required by the terms of the Employee Stock
Ownership Plan consistent with past practice;
(c) amend its certificate of incorporation, by-laws or other
comparable charter or organizational documents;
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(d) except to the extent contemplated by the agreements
referred to in Section 5.01(d) of the Disclosure Schedule, directly or
indirectly acquire, make any investment (other than investments not
exceeding $5,000,000 in the aggregate) in, or make any capital
contributions to, any person (other than a Subsidiary of the Company)
other than in the ordinary course of business consistent with past
practice;
(e) make any new capital expenditure or expenditures in excess
of $2,500,000 in the aggregate, other than as set forth in the
Company's budget for capital expenditures, a copy of which has been
previously delivered to Parent and Purchaser;
(f) enter into, amend or terminate any Material Contract
involving expenses of at least $2,500,000 per year other than in the
ordinary course of business consistent with past practice;
(g) directly or indirectly sell, pledge or otherwise dispose
of or encumber any of its properties or assets that are material to its
business, except for sales, pledges or other dispositions or
encumbrances in the ordinary course of business consistent with past
practice;
(h) (i) except for borrowings under the Credit Agreement
(without increases in any existing limits) and the uncommitted lines of
credit described in Section 3.11 of the Disclosure Schedule in the
ordinary course of business consistent with past practice and other
than in connection with any action permitted by Section 5.01(d), incur
any indebtedness for borrowed money or guarantee any such indebtedness
of another person, other than indebtedness owing to or guarantees of
indebtedness owing to the Company or any direct or indirect wholly
owned Subsidiary of the Company or (ii) make any loans or advances to
any other person, other than to the Company or to any direct or
indirect wholly owned Subsidiary of the Company and other than routine
advances to employees consistent with past practice;
(i) except as required under any existing Company Plan or
Foreign Benefit Plan, (A) grant or agree to grant to any director,
officer or employee, any increase in wages or bonus, severance, profit
sharing, retirement, deferred compensation, insurance or other
compensation or benefits to such officers and employees, except for
increases in the ordinary course of business and consistent with past
practice, or (B) establish any new compensation or benefit plans or
arrangements, or amend or agree to amend any existing Company Plans or
Foreign Benefit Plans, except as may be required under existing
agreements or by law;
(j) other than as set forth in Section 5.01(j) of the
Disclosure Schedule and except as required under the existing Company
Plans or Foreign Benefit Plans, accelerate the payment, right to
payment or vesting of any bonus, severance, profit sharing, retirement,
deferred compensation, Stock Option, insurance or other compensation or
benefits;
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(k) enter into or amend any employment, severance or similar
agreement with any existing officers or employees, except for severance
agreements entered into to the extent required pursuant to severance
plans existing on the date hereof;
(l) except as set forth in Section 5.01(l) of the Disclosure
Schedule, make or rescind any Tax election or settle or compromise any
income Tax liability of the Company or of any of its Subsidiaries with
any Governmental Entity or settle any action, suit, claim,
investigation or proceeding with any Government Entity (legal,
administrative or arbitrative) in an amount in excess of $1,000,000;
(m) pay, discharge or satisfy any claims, liabilities or
obligations, other than the payment, discharge or satisfaction (i) of
any such claims, liabilities or obligations in the ordinary course of
business or (ii) of claims, liabilities or obligations reflected or
reserved against in, or contemplated by, the consolidated financial
statements (or the notes thereto) of the Company and its consolidated
Subsidiaries or (iii) other than settlements which involve solely the
payment of money that would not result in an uninsured or underinsured
payment by or liability of the Company in excess of $2,000,000 in the
aggregate above reserves established therefor on the books of the
Company except as disclosed in Section 5.01(m) of the Disclosure
Schedule;
(n) except as disclosed in the Filed SEC Documents or required
by a Governmental Entity, make any change in any method of accounting
or accounting practice or policy, except as required by GAAP;
(o) enter into any agreement, understanding or commitment that
materially restrains, limits or impedes the Company's ability to
compete with or conduct any material line of business, including, but
not limited to, geographic limitations on the Company's activities;
(p) plan, announce, implement or effect any reduction in
force, lay-off, early retirement program, severance program or other
program or effort concerning the termination of employment of employees
of the Company or its Subsidiaries; provided, however, that routine
employee terminations or terminations under the Company's "Operation
Leading Edge" program (as disclosed in the Filed SEC Documents) shall
not be considered subject to this clause (p); or
(q) authorize any of, or commit or agree to take any of, the
foregoing actions in respect of which it is restricted by the
provisions of this Section 5.01 except to the extent such action is
otherwise expressly contemplated by this Agreement.
ARTICLE VI
ADDITIONAL COVENANTS
SECTION 6.01 Company Stockholders Meeting; Proxy Statement;
Merger. (a) As soon as practicable following the acceptance for payment of and
payment for Shares by Purchaser in the Offer, if required by law to consummate
the Merger, the Company shall with the cooperation of Parent take all action
necessary, in accordance with the DGCL, the Exchange Act
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and other applicable law and its restated certificate of incorporation and
by-laws, to convene and hold a special meeting of the stockholders of the
Company (the "Stockholders Meeting") for the purpose of considering and voting
upon the adoption of this Agreement and to solicit proxies pursuant to the Proxy
Statement in connection therewith. The Board of Directors of the Company shall
recommend that the holders of Shares vote in favor of the adoption of this
Agreement at the Stockholders Meeting and shall cause such recommendation to be
included in the Proxy Statement. At the Stockholders Meeting, Parent and
Purchaser shall cause all of the Shares owned by them to be voted in favor of
the adoption of this Agreement.
(b) The Company, if requested by Parent, shall promptly
prepare and file with the SEC a proxy statement (together with any supplement or
amendment thereto, the "Proxy Statement") relating to the Stockholders Meeting
in accordance with the Exchange Act and the rules and regulations thereunder.
Parent, Purchaser and the Company will cooperate with each other in the
preparation of the Proxy Statement, and the Company shall notify Parent of the
receipt of any comments of the SEC with respect to the Proxy Statement and of
any requests by the SEC for any amendment or supplement thereto or for
additional information and shall provide to Parent promptly copies of all
correspondence between the Company or any representative of the Company and the
SEC. Parent and its counsel shall be given a reasonable opportunity to review
and comment on the Proxy Statement, including all amendments and supplements
thereto, prior to the filing thereof with the SEC. The Company agrees to provide
Parent and Purchaser and its counsel any comments the Company or its counsel may
receive from the SEC or its staff with respect to the Proxy Statement promptly
after receipt of such comments. Without limiting the generality or effect of the
foregoing, the Company shall use its best efforts to respond to all SEC comments
with respect to the Proxy Statement and, subject to compliance with SEC rules
and regulations, to cause the Proxy Statement to be mailed to the Company's
stockholders at the earliest practicable date. Each of Parent and Purchaser
shall promptly supply to the Company in writing, for inclusion in the Proxy
Statement, all information concerning Parent and Purchaser required under the
Exchange Act and the rules and regulations thereunder to be included in the
Proxy Statement.
(c) Notwithstanding the foregoing clauses (a) and (b), in the
event that Purchaser shall acquire ownership of at least 90% of the outstanding
Shares upon consummation of the Offer, Purchaser and Parent shall take all
necessary actions to cause the Merger to become effective, as soon as
practicable after the expiration of the Offer, without a meeting of stockholders
of the Company, in accordance with Section 253 of the DGCL.
SECTION 6.02 Access to Information; Notification of Certain
Matters. (a) Subject to the provisions of any confidentiality agreement by which
the Company is bound (provided that the Company shall advise Parent that
information is not being provided as a result thereof and whether such
information, in the good faith belief of the Company, has had or would
reasonably be expected to have a Material Adverse Effect on the Company), the
Company shall, and shall cause each of its Subsidiaries to, afford to Parent and
its officers, employees, counsel, financial advisors and other representatives
prompt, reasonable access during the period prior to the Effective Time to all
of the Company's and its Subsidiaries' properties, books, contracts,
commitments, Returns, personnel and records, and, during such period, the
Company shall, and shall cause each of its Subsidiaries to, furnish as promptly
as practicable to Parent such information concerning the Company's and its
Subsidiaries' businesses, properties, financial
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condition, operations and personnel as Parent may from time to time reasonably
request. Any such investigation by Parent shall not affect the representations
or warranties of the Company contained in this Agreement. Parent will hold any
information provided under this Section 6.02 that is nonpublic in confidence to
the extent required by, and in accordance with, the provisions of the letter
dated December 8, 2000 (the "Confidentiality Agreement"), between the Company
and Parent.
(b) The Company shall give prompt notice to Parent of (i) the
occurrence or nonoccurrence of any event which would cause any representation or
warranty contained in this Agreement to be untrue or inaccurate in any material
respect at or prior to the Effective Time and (ii) any material failure of the
Company to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder, in either case which would
reasonably be expected to cause any of the conditions set forth in clause
(e)(iii), (e)(iv) or (e)(v) of Exhibit A hereto to fail to be satisfied;
provided, however, that the delivery of any notice pursuant to this Section
6.02(b) shall not limit or otherwise affect the rights or remedies available
hereunder to Parent; provided further that this Section 6.02 shall not
constitute a covenant or agreement for the purpose of Section 8.01(e)(v) or
clause (e)(iii) of Exhibit A hereto.
SECTION 6.03 Reasonable Best Efforts. On the terms and subject
to the conditions set forth in this Agreement, including, without limitation,
Section 6.05 hereof, each of the parties shall use its reasonable best efforts
to take, or cause to be taken, all actions, and do, or cause to be done, and
assist and cooperate with the other parties in doing, all things necessary,
proper or advisable to consummate and make effective, in the most expeditious
manner practicable, the Offer, the Merger and the other transactions
contemplated hereby, including the satisfaction of the respective conditions set
forth in Article VII.
SECTION 6.04 Public Announcements. Parent and Purchaser, on
the one hand, and the Company, on the other hand, shall consult with each other
before issuing, and provide each other the opportunity to review and comment
upon, any press release, SEC filing (including the Offer Documents, the Schedule
14D-9 and the Proxy Statement) or other public statements with respect to the
transactions contemplated hereby, including the Offer and Merger, and shall not
issue any such press release or make any such public statement prior to such
consultation, except as may be required by applicable law, by court process or
by obligations pursuant to any listing agreement with any securities exchange.
SECTION 6.05 No Solicitation. (a) From the date hereof, the
Company shall not (whether directly or indirectly through advisors, agents or
other intermediaries), and the Company shall use its reasonable best efforts to
cause its respective officers, directors, advisors, representatives and other
agents of the Company not to, directly or indirectly, (i) solicit, initiate or
knowingly encourage any inquiries relating to, or the submission of, any
Acquisition Proposal (as hereinafter defined), (ii) participate in any
discussions or negotiations regarding any Acquisition Proposal, or, in
connection with any Acquisition Proposal, furnish to any person any information
or data with respect to or access to the properties of the Company or any of its
Subsidiaries, or take any other action to facilitate the making of any proposal
that constitutes or may reasonably be expected to lead to, any Acquisition
Proposal or (iii) enter into any agreement with respect to any Acquisition
Proposal or approve or resolve to approve any Acquisition Proposal; provided
that, prior to consummation of the Offer, if the Board of Directors of the
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Company, after receiving advice from outside counsel, has concluded in good
faith that such action is reasonably necessary for the Board of Directors to act
in a manner consistent with its fiduciary duties under applicable law, then the
Company may furnish information with respect to the Company and its Subsidiaries
and participate in discussions or negotiations regarding such Acquisition
Proposal, in which case the Company will not disclose any information to such
person without entering into a confidentiality agreement substantially identical
to the Confidentiality Agreement (it being understood that the Company may enter
into a confidentiality agreement without a standstill or with a standstill
provision less favorable to the Company if it waives or similarly modifies the
standstill provision in the Confidentiality Agreement). The Company shall
promptly (but in no case later than 24 hours after receipt) provide Parent with
a copy of any written Acquisition Proposal received and a written statement with
respect to any non-written Acquisition Proposal received, which statement shall
include the identity of the parties making the Acquisition Proposal and the
material terms thereof. The Company shall keep Parent informed on a current
basis of the status and content of any discussions regarding any Acquisition
Proposal with a third party. Nothing contained in this Section 6.05 prohibit the
Company or the Company's Board of Directors from taking and disclosing to the
Company's stockholders a position contemplated by Rules 14d-9 and 14e-2(a)
promulgated under the Exchange Act (or any similar communications in connection
with the making or amendment of a tender offer or exchange offer) or from making
any disclosure required by applicable law or, prior to the consummation of the
Offer, from taking any action contemplated by Section 8.01(d)(i), including
having the Board of Directors take such actions as are necessary to approve or
resolve to approve the intention to enter into an agreement with respect to a
Superior Proposal (as hereinafter defined) (or any announcement in connection
therewith) or enter into an agreement with respect to a Superior Proposal
concurrently with termination pursuant to Section 8.01(d)(i).
(b) "Acquisition Proposal" means any offer or proposal for a
merger, consolidation, share exchange, recapitalization, liquidation or other
business combination involving the Company or any of its Subsidiaries or the
acquisition or purchase of 20% or more of any class of equity securities of the
Company or any of its Subsidiaries, or any tender offer (including self-tenders)
or exchange offer that if consummated would result in any person beneficially
owning 20% or more of any class of equity securities of the Company or any of
its Subsidiaries, or a substantial portion of the assets of, the Company or any
of its Subsidiaries, other than the transactions contemplated by this Agreement;
(c) "Superior Proposal" means an Acquisition Proposal which
the Board of Directors determines, in good faith after consultation with an
independent, nationally recognized investment banking firm, (i) if consummated
would result in a transaction more favorable to the Company's stockholders, from
a financial point of view, than the transactions contemplated by this Agreement
and (ii) is reasonably capable of being financed by the person making such
Acquisition Proposal.
SECTION 6.06 Consents, Approvals and Filings. (a) Upon the
terms and subject to the conditions hereof, each of the parties hereto shall (i)
make promptly its respective filings, and thereafter make any other required
submissions, under the HSR Act, the CAC, the EC Merger Regulation, the Exchange
Act and any other relevant statute, rule or regulation, with respect to the
Offer, the Merger and the other transactions contemplated hereby and (ii) use
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reasonable best efforts (or, in connection with obtaining antitrust approval
from any U.S. Governmental Entity, best efforts) to take, or cause to be taken,
all appropriate action, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the Offer, the Merger and the other transactions contemplated hereby,
including using reasonable best efforts (or, in connection with obtaining
antitrust approval from any U.S. Governmental Entity, best efforts) to obtain
all licenses, permits, consents, approvals, authorizations, qualifications and
orders of Governmental Entities and cooperate to obtain all consents, approvals
and authorizations (without out-of-pocket expense to the Company) of parties to
contracts with the Company and its Subsidiaries as are necessary for the
consummation of the Offer, the Merger and the other transactions contemplated
hereby and to fulfill the conditions to the Offer and the Merger. In case at any
time after the Effective Time any further action is necessary or desirable to
carry out the purposes of this Agreement, the proper officers and directors of
each party to this Agreement shall use their reasonable best efforts to take all
such action.
(b) Notwithstanding anything to the contrary herein, Parent
agrees to, and to cause its affiliates to, promptly take all steps necessary to
secure government antitrust clearance for the consummation of the transactions
contemplated hereby as soon as practicable but by no later than June 30, 2001.
Parent agrees to give the Company reasonable notice of any meetings prior to the
Closing Date with any Governmental Entity regarding the transactions
contemplated hereby, and the Company at its option may have representatives at
such meetings.
(c) Notwithstanding anything to the contrary herein, Parent
agrees to use its best efforts to take, or cause to be taken, all necessary
action and to do, or cause to be done, all things necessary to satisfy the
condition to the Offer set forth in clause (c) of Exhibit A; provided that
nothing in this Agreement shall require Parent or any of its Subsidiaries to
take, or cause to be taken, or do or cause to be done, any action which would
result in a material detriment to Parent and its Subsidiaries or would result in
a material restriction on the business activities thereof. Upon receiving
written advice from the Works' Council of Parent that is not Positive Advice or
Acceptable Conditional Advice, Parent shall, as promptly as practicable and in
any event within five days thereof, notify the Works' Council in writing, as
required by the Netherlands Works Council Act, as to its intention to enter into
the Facility and issue the Facility Guarantee (each as defined in Exhibit A
hereto).
SECTION 6.07 Employee Benefit Plans. (a) Parent agrees that
those individuals who are employed by the Company or any of its Subsidiaries
immediately prior to the Effective Time shall continue to be employees of the
Surviving Entity as of the Effective Time (each such employee, an "Affected
Employee"); provided, however, that this Section 6.07 shall not be construed to
limit the ability of the applicable employer to terminate the employment of any
Affected Employee at any time.
(b) For a period of 12 months following the Effective Time,
Parent shall, or shall cause the Surviving Corporation to, provide each Affected
Employee with employee benefits that are no less favorable in the aggregate than
those provided to each such Affected Employee immediately prior to the Effective
Time (other than equity-based compensation or benefits provided under the
Employee Stock Ownership Plan), provided that Parent shall not be required to
provide equity-based compensation to any Affected Employees. Parent shall, for a
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period of 12 months following the Effective Time, maintain (or cause its
Subsidiaries to maintain) a severance pay practice, program or arrangement for
the benefit of each Affected Employee that is no less favorable than such
practice, program or arrangement in effect immediately prior to the Effective
Time with respect to such Affected Employee.
(c) To the extent permitted under applicable law, Parent
shall, or shall cause the Surviving Entity to, give Affected Employees full
credit for purposes of eligibility and vesting and benefit accrual (except for
benefit accruals under any defined benefit pension plan or supplemental or
excess pension plan) under such employee benefit plans or arrangements
maintained by the Parent or the Surviving Corporation in which such Affected
Employees participate for such Affected Employees' service with the Company or
any Subsidiary of the Company to the same extent recognized by the Company or
such Subsidiary immediately prior to the Effective Time.
(d) To the extent permitted under applicable law, Parent
shall, or shall cause the Surviving Entity to, (i) waive all limitations as to
preexisting conditions, exclusions and waiting periods with respect to
participation and coverage requirements applicable to the Affected Employees
under any welfare benefit plans in which such Affected Employees may be eligible
to participate after the Effective Time, other than limitations or waiting
periods that are already in effect with respect to such Affected Employees and
that have not been satisfied as of the Effective Time under any welfare plan
maintained for the Affected Employees immediately prior to the Effective Time,
and (ii) provide each Affected Employee with credit for any co-payments and
deductibles paid prior to the Effective Time in satisfying any applicable
deductible or out-of-pocket requirements under any welfare plans that such
Affected Employees are eligible to participate in after the Effective Time.
(e) Parent shall, or cause the Surviving Corporation to,
discharge the obligations under any change in control agreement entered into by
the Company and an Affected Employee.
(f) Pursuant to the terms of the Trust Under the ACNielsen
Nonqualified Plans and the Trust Under the ACNielsen Deferred Compensation Plan
(together, the "Rabbi Trusts"), the Company shall make an irrevocable
contribution to each Rabbi Trust in an amount (i) sufficient to pay each
participant the benefits under the plans covered by such Rabbi Trust and (ii)
sufficient to pay the annual fees payable to the trustees under such Rabbi Trust
for a three-year period.
SECTION 6.08 Indemnification; Directors' and Officers'
Insurance. (a) For a period of six years after the Effective Time, the
provisions with respect to indemnification, exculpation and advancement of
expenses set forth in Article V of the restated certificate of incorporation of
the Company as in effect on the date of this Agreement (a true, correct and
complete copy of which has been made available to Parent), shall not be amended,
repealed or otherwise modified in any manner that would adversely affect the
rights thereunder of individuals who at any time prior to the Effective Time
were directors or officers of the Company in respect of actions or omissions
occurring at or prior to the Effective Time (including, without limitation, the
transactions contemplated by this Agreement), unless such modification is
required by law.
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(b) From and after the Effective Time, Parent shall cause the
Surviving Corporation and its successors to indemnify, defend and hold harmless
each person who is now, or has been at any time prior to the date hereof or who
becomes prior to the Effective Time, an officer or director of the Company (the
"Covered Parties") against all losses, claims, damages, costs, expenses
(including reasonable attorneys' fees and expenses), liabilities or judgments or
amounts that are paid in settlement with the approval of the indemnifying party
(which approval shall not be unreasonably withheld or delayed) incurred in
connection with any threatened or actual action, suit or proceeding based in
whole or in part on or arising in whole or in part out of the fact that such
person is or was a director or officer of the Company ("Indemnified
Liabilities"), including all Indemnified Liabilities based in whole or in part
on, or arising in whole or in part out of, this Agreement or the transactions
contemplated hereby, in each case, to the full extent that a corporation is
permitted under the DGCL to indemnify its own directors or officers, as the case
may be. In the event any such claim, action, suit, proceeding or investigation
is brought against any Covered Party, the indemnifying party shall assume and
direct all aspects of the defense thereof, including settlement, and the Covered
Party shall cooperate in the vigorous defense of any such matter. The Covered
Party shall have a right to participate in (but not control) the defense of any
such matter with its own counsel and at its own expense. Notwithstanding the
right of the indemnifying party to assume and control the defense of such
litigation, claim or proceeding, such Covered Party shall have the right to
employ separate counsel and to participate in the defense of such litigation,
claim or proceeding, and the indemnifying party shall bear the fees, costs and
expenses of such separate counsel and shall pay such fees, costs and expenses
promptly after receipt of an invoice from such Covered Party if (i) the use of
counsel chosen by the indemnifying party to represent such Covered Party would
present such counsel with a conflict of interest, (ii) the defendants in, or
targets of, any such litigation, claim or proceeding shall have been advised by
counsel that there may be legal defenses available to it or to other Covered
Parties which are different from or in addition to those available to the
indemnifying party, or (iii) the indemnifying party shall not have employed
counsel satisfactory to such Covered Party, in the exercise of the Covered
Party's reasonable judgment, to represent such Covered Party within a reasonable
time after notice of the institution of such litigation, claim or proceeding.
The indemnifying party shall not settle any such matter unless (i) the Covered
Party gives prior written consent, which shall not be unreasonably withheld or
delayed, or (ii) the terms of the settlement provide that the Covered Party
shall have no responsibility for the discharge of any settlement amount and
impose no other obligations or duties on the Covered Party, and the settlement
discharges all rights against Covered Party with respect to such matter. In no
event shall the indemnifying party be liable for any settlement effected without
its prior written consent. Any Covered Party wishing to claim indemnification
under this Section 6.08(b), upon learning of any such claim, action, suit,
proceeding or investigation, shall promptly notify Parent and the Surviving
Corporation (but the failure so to notify shall not relieve the indemnifying
party from any liability which it may have under this Section 6.08(b), except to
the extent such failure materially prejudices such indemnifying party), and
shall deliver to Parent and the Surviving Corporation the undertaking
contemplated by Section 145(e) of the DGCL. The Covered Parties as a group will
be represented by a single law firm (plus no more than one local counsel in any
jurisdiction) with respect to each such matter unless there is, under applicable
standards of professional conduct, a conflict on any significant issue between
the positions of any two or more Covered Parties. The rights to indemnification
under this Section 6.08(b) shall continue in full force and effect for a period
of six years from the
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Effective Time; provided, however, that all rights to indemnification in respect
of any Indemnified Liabilities asserted or made within such period shall
continue until the disposition of such Indemnified Liabilities.
(c) For a period of six years after the Effective Time, Parent
shall cause to be maintained in effect policies of directors' and officers'
liability insurance, for the benefit of those persons who are covered by the
Company's directors' and officers' liability insurance policies at the Effective
Time, providing coverage with respect to matters occurring prior to the
Effective Time that is at least equal to the coverage provided under the
Company's current directors' and officers' liability insurance policies, to the
extent that such liability insurance can be maintained at an annual cost to
Parent not greater than 200 percent of the premium for the current Company
directors' and officers' liability insurance; provided that if such insurance
cannot be so maintained at such cost, Parent shall maintain as much of such
insurance as can be so maintained at a cost equal to 200 percent of the current
annual premiums of the Company for such insurance.
(d) In the event that Parent or the Surviving Corporation or
any of its successors or assigns (i) consolidates with or merges into any other
person and shall not be the continuing or surviving corporation or entity of
such consolidation or merger or (ii) transfers or conveys all or substantially
all of its properties and assets to any person, then, and in each such case,
proper provision shall be made so that the successors or assigns of Parent or
the Surviving Corporation shall succeed to the obligations set forth in Section
6.07 and this Section 6.08.
SECTION 6.09 Undertakings. Each of Parent, Purchaser and the
Company agree to make the undertakings and to take or cause to be taken all
other actions as are required in order to comply with the Indemnity and Joint
Defense Agreement dated as of October 28, 1996 among The Dun & Bradstreet
Corporation, NMR (as successor to Cognizant Corporation) and the Company.
ARTICLE VII
CONDITIONS PRECEDENT
SECTION 7.01 Conditions to Each Party's Obligation to Effect
the Merger. The respective obligation of each party to effect the Merger shall
be subject to the satisfaction or written waiver on or prior to the Closing Date
of the following conditions:
(a) Completion of the Offer. Purchaser shall have accepted for
payment and paid for all Shares validly tendered in the Offer and not
withdrawn; provided, however, that neither Parent nor Purchaser may
invoke this condition if Purchaser shall have failed to purchase Shares
so tendered and not withdrawn in violation of the terms of this
Agreement or the Offer.
(b) Stockholder Approval. This Agreement shall have been
adopted by the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Company if such vote is
required pursuant to the Company's restated certificate of
incorporation, the DGCL or other applicable law.
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<PAGE> 45
(c) No Injunctions or Restraints. No temporary restraining
order, preliminary or permanent injunction or other order issued by any
court of competent jurisdiction or other legal restraint or prohibition
preventing the consummation of the Merger shall be in effect; provided,
however, that, prior to invoking this condition, the party so invoking
this condition shall have complied with its obligations under Section
6.03 and Section 6.06 and the parties hereto shall have used their
reasonable best efforts or best efforts (as applicable) to lift or
remove such order, injunction, restraint or prohibition.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
SECTION 8.01 Termination. This Agreement may be terminated and
the Merger contemplated herein may be abandoned at any time prior to the
Effective Time, whether before or after approval of matters presented in
connection with the Merger by the stockholders of Purchaser or, subject to the
terms hereof, of the Company:
(a) By the mutual written consent of Parent and the Company
duly authorized by the Board of Directors of Parent and the Company;
provided, however, that if Parent shall have nominated a majority of
the directors pursuant to Section 1.04, such consent of the Company may
only be given if approved by the Board of Directors of the Company in
accordance with Section 1.04(c).
(b) By either of Parent or the Company duly authorized by the
Board of Directors of such person if (i) a statute, rule or executive
order shall have been enacted, entered or promulgated prohibiting the
transactions contemplated hereby on the terms contemplated by this
Agreement or (ii) any Governmental Entity shall have issued an order,
decree or ruling or taken any other action (which order, decree, ruling
or other action the parties hereto shall use their reasonable best
efforts (or, in connection with obtaining antitrust approval from any
Governmental Entity, best efforts) to lift), in each case permanently
restraining, enjoining or otherwise prohibiting the transactions
contemplated hereby and such order, decree, ruling or other action
shall have become final and non-appealable.
(c) By either of Parent or the Company duly authorized by the
Board of Directors of such person if consummation of the Offer shall
not have occurred on or before June 30, 2001 (the "Termination Date");
provided, however, that the party seeking to terminate this Agreement
pursuant to this Section 8.01(c) shall not have breached in any
material respect its obligations under this Agreement; and provided
further that the Termination Date shall be extended to such later date
(but in no event later than September 30, 2001) as the Offer shall have
been extended by Purchaser at the request of the Company pursuant to
the third sentence of Section 1.01(c) hereof, unless a condition to
consummation of the Offer (other than the condition referred to in
clause (c) of Exhibit A) shall not have been satisfied and either (i)
Parent can reasonably demonstrate that such failure to be satisfied
resulted from a reason other than the failure of the condition set
forth in clause (c) of Exhibit A to be satisfied or (ii) such condition
failed to be satisfied as a result of a material breach by the Company
of its obligations hereunder.
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<PAGE> 46
(d) By the Company, upon approval of its Board of Directors:
(i) prior to consummation of the Offer, if (A) the
Board of Directors of the Company notifies Parent in writing
that it intends to enter into an agreement with respect to a
Superior Proposal, attaching the most current version of such
agreement (or a description of all material terms and
conditions thereof) to such notice, (B) Parent does not make,
within four Business Days of receipt of the Company's written
notification of its intention to enter into a binding
agreement for a Superior Proposal, an offer that the Board of
Directors of the Company determines, in good faith after
consultation with its financial advisor, is at least as
favorable to the stockholders of the Company as such Superior
Proposal, it being understood that the Company shall not enter
into any such binding agreement during such four-day period
and (C) the Company prior to such termination pursuant to this
Section 8.01(d)(i) pays to Parent in immediately available
funds the Termination Fee (as such term is defined in Section
8.03(b)). The Company agrees to notify Parent promptly if its
intention to enter into a written agreement referred to in its
notification shall change at any time after giving effect to
such notification; or
(ii) if Parent or Purchaser shall have terminated the
Offer or the Offer expires without Parent or Purchaser, as the
case may be, purchasing any Shares pursuant thereto; provided
that the Company may not terminate this Agreement pursuant to
this Section 8.01(d)(ii) if the Company is in material breach
of this Agreement; or
(iii) prior to the consummation of the Offer, if (A)
there shall be a breach of any representation or warranty of
Parent or Purchaser in this Agreement that is qualified as to
Material Adverse Effect, (B) there shall be a breach in any
material respect of any representation or warranty of Parent
or Purchaser in this Agreement that is not so qualified, other
than any such breaches which, in the aggregate, have not had
or would not reasonably be likely to have a Material Adverse
Effect on Parent and Purchaser, taken as a whole, or (C) there
shall be a material breach by Parent or Purchaser of any of
its covenants or agreements contained in this Agreement, which
breach, in the case of clause (A), (B) or (C), either is not
reasonably capable of being cured or, if it is reasonably
capable of being cured, has not been cured within the earlier
of (i) 10 days after giving of notice to Parent of such breach
and (ii) the expiration of the Offer, provided that the
Company may not terminate this Agreement pursuant to this
Section 8.01(d)(iii) if the Company is in material breach of
this Agreement.
(e) By Parent or Purchaser duly authorized by the Board of
Directors of such person:
(i) prior to the consummation of the Offer, if the
Board of Directors of the Company shall have withdrawn, or
modified or changed, in a manner adverse to Parent or
Purchaser, its approval or recommendation of the Offer, this
Agreement or the Merger or shall have recommended or approved
an Acquisition
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Proposal, it being understood and agreed that neither the
delivery of notice pursuant to Section 8.01(d)(i) and any
subsequent public announcement of such notice nor any
communication by the Board of Directors of the Company to the
stockholders of the Company pursuant to Rule 14d-9(e)(3) under
the Exchange Act (or any similar communication to the
stockholders of the Company in connection with the making or
amendment of a tender offer or exchange offer) shall entitle
Parent to terminate this Agreement pursuant to this Section
8.01(e)(i), unless the Company enters into a definitive
agreement with respect to an Acquisition Proposal; or
(ii) prior to the consummation of the Offer, if there
shall have been a material breach by the Company of any
provision of Section 6.05; or
(iii) if the Offer has expired or terminated without
Parent or Purchaser purchasing any Shares thereunder and,
pursuant to Exhibit A and Article I hereof, Purchaser is
neither required to accept and pay for the Shares tendered in
the Offer nor to extend the expiration date of the Offer;
provided that Parent or Purchaser may not terminate this
Agreement pursuant to this Section 8.01(e)(iii) if Parent or
Purchaser is in material breach of this Agreement; or
(iv) prior to the consummation of the Offer, if the
Company shall have (A) exempted for purposes of Section 203 of
the DGCL any acquisition of Shares by any person or "group"
(as defined in Section 13(d)(3) of the Exchange Act), other
than Parent, Purchaser or their affiliates, or (B) amended (or
agreed to amend) its Rights Agreement or redeemed (or agreed
to redeem) its outstanding Rights thereunder for the purpose
of exempting an acquisition of Shares from such Rights
Agreement and Rights; or
(v) prior to the consummation of the Offer, if (A)
there shall be a breach of any representation or warranty of
the Company in this Agreement that is qualified as to Material
Adverse Effect, (B) there shall be a breach in any material
respect of any representation or warranty of the Company in
this Agreement that is not so qualified other than any such
breaches which, in the aggregate, have not had or would not
reasonably be likely to have a Material Adverse Effect on the
Company, or (C) there shall be a material breach by the
Company of any of its covenants or agreements contained in
this Agreement, which breach, in the case of clause (A), (B)
or (C), either is not reasonably capable of being cured or, if
it is reasonably capable of being cured, has not been cured
within the earlier of (i) 10 days after giving of written
notice to the Company of such breach and (ii) the expiration
of the Offer; provided that Parent or Purchaser may not
terminate this Agreement pursuant to this Section 8.01(e)(v)
if Parent or Purchaser is in material breach of this
Agreement.
SECTION 8.02 Effect of Termination. In the event of
termination of this Agreement by either the Company or Parent or Purchaser as
provided in Section 8.01, this Agreement shall forthwith become void and have no
effect, without any liability or obligation on the part of Parent, Purchaser or
the Company, other than the provisions of Section 6.02(a), this
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<PAGE> 48
Section 8.02, Section 8.03 and Article IX and except to the extent that such
termination results from the material breach by a party of any of its
representations, warranties, covenants or agreements set forth in this
Agreement.
SECTION 8.03 Fees and Expenses. (a) Except as provided in
Section 8.03(b) and Section 8.03(c) below, all fees and expenses incurred in
connection with the Offer, the Merger, this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such fees or expenses,
whether or not the Offer or the Merger is consummated.
(b) If (i) Parent or Purchaser terminates this Agreement
pursuant to Section 8.01(e)(i) or 8.01(e)(iv), or (ii) the Company terminates
this Agreement pursuant to Section 8.01(d)(i), then, in each case, the Company
shall pay, or cause to be paid, to Parent, at or prior to the time of
termination in the case of a termination pursuant to Section 8.01(d)(i) or as
promptly as is reasonably practicable (but in no event later than two Business
Days), in the case of a termination pursuant to Section 8.01(e)(i) or (iv), an
amount (the "Termination Fee") equal to $60,000,000. In addition, if (A) this
Agreement is terminated pursuant to Section 8.01(e)(ii), 8.01(e)(iii) or
8.01(d)(ii), (B) on the date of such termination, no condition to the Offer has
failed to be satisfied as a result of a material breach of this Agreement by
Parent or Purchaser and prior thereto there shall have been publicly announced,
and not withdrawn, an Acquisition Proposal, and (C) within 15 months after such
termination, the Company shall enter into an agreement with respect to any
Acquisition Proposal, then the Company shall pay the Termination Fee
concurrently with entering into any such agreement.
(c) If the condition set forth in clause (c) of Exhibit A is
not satisfied and this Agreement is terminated pursuant to Section 8.01(c),
unless a condition to consummation of the Offer (other than the condition
referred to clause (c) of Exhibit A) shall not have been satisfied and either
(i) Parent can reasonably demonstrate that such failure to be satisfied resulted
from a reason other than the failure of the condition set forth in such clause
(c) to be satisfied or (ii) such condition failed to be satisfied as a result of
a material breach by the Company of its obligations hereunder, then Parent shall
pay, or cause to be paid, to the Company an amount equal to $60,000,000, which
shall be paid (A) at or prior to such termination by Parent and as a condition
to such termination or (B) not later than two Business Days following such
termination by the Company.
(d) Any payments required to be made pursuant to this Section
8.03 shall be made by wire transfer of same day funds to an account designated
by the recipient.
SECTION 8.04 Amendment and Modification. This Agreement may be
amended, modified and supplemented in any and all respects whether before or
after any vote of Purchaser or the stockholders of the Company contemplated
hereby by written agreement of the parties hereto (which in the case of the
Company shall include approvals as contemplated in Section 1.04(c)), at any time
prior to the Effective Time with respect to any of the terms contained herein;
provided, however, that after the adoption of this Agreement by the stockholders
of the Company, if applicable, no amendment shall be made which, under
applicable law, requires the further approval of such stockholders without such
approval.
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SECTION 8.05 Extension; Waiver. Subject to Section 1.04
hereof, at any time prior to the Effective Time, any party hereto may (a) extend
the time for the performance of any of the obligations or other acts of any
other party, (b) waive any inaccuracies in the representations and warranties of
any other party contained in this Agreement or in any document delivered
pursuant to this Agreement, or (c) subject to applicable law, waive compliance
with any of the agreements of any other party or conditions to the obligations
of such party contained in this Agreement. Any agreement on the part of a party
to any such extension or waiver shall be valid only if set forth in a written
instrument executed and delivered by a duly authorized officer on behalf of such
party. The failure of any party to this Agreement to assert any of its rights
under this Agreement or otherwise shall not constitute a waiver of such rights.
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.01 Notices. All notices, requests, claims, demands
and other communications under this Agreement shall be in writing and shall be
deemed given if delivered personally or sent by overnight courier (providing
proof of delivery) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice) on the date of
delivery, or if by facsimile, upon confirmation of receipt:
(a) if to Parent or to Purchaser, to:
VNU N.V.
Ceylonpoort 5-25, 2037 AA Haarlem
P.O. Box 1, 2000 MA Haarlem
The Netherlands
Attention: Chairman of the Board of
Executive Directors
Facsimile: 011-31-23-546-3938
and
VNU, Inc.
770 Broadway
New York, New York 10003-9595
Attention: Gerald S. Hobbs
Facsimile: (646) 654-5001
with a copy (which shall not constitute
notice) to:
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022-6069
Attention: John J. Madden
Clare O'Brien
Facsimile: (212) 848-7179
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(b) if to the Company, to:
ACNielsen Corporation
177 Broad Street
Stamford, Connecticut 06901
Attention: Executive Vice President & General Counsel
Facsimile: (203) 961-3179
with a copy (which shall not constitute
notice) to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard A. Garvey
John G. Finley
Facsimile: (212) 455-2502
SECTION 9.02 Certain Definitions. For purposes of this
Agreement:
(a) "affiliate" of any person means another person that
directly or indirectly, through one or more intermediaries, controls,
is controlled by, or is under common control with, such first person.
(b) "Business Day" means any day other than Saturday, Sunday
or any other day on which banks in The City of New York are required or
permitted to close.
(c) "knowledge" means the knowledge of any officer of the
Company.
(d) "person" means an individual, corporation, partnership,
joint venture, association, trust, unincorporated organization or other
entity.
(e) "Subsidiary" of any person means any other person of which
(i) such person or any Subsidiary thereof is a general partner, (ii)
such person and/or one or more of its Subsidiaries holds voting power
to elect a majority of the board of directors or others performing
similar functions or (iii) such person, directly or indirectly, owns or
controls more than 50% of the equity interests of such other person.
SECTION 9.03 Interpretation. When a reference is made in this
Agreement to an Article or Section, such reference shall be to an Article or
Section of this Agreement unless otherwise indicated. The table of contents and
headings contained in this Agreement are for convenience of reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include," "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation." The inclusion of any matter in the Company's Disclosure Schedule in
connection with any representation, warranty, covenant or agreement that is
qualified as to materiality or "Material Adverse Effect" shall not be an
admission by the Company that such matter is material or would have a Material
Adverse Effect. Matters disclosed in any section of the Company's Disclosure
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<PAGE> 51
Schedule or in Article III shall be considered disclosed for all purposes under
Article III, to the extent that such matter on its face would reasonably be
expected to be pertinent in light of the disclosure made.
SECTION 9.04 Entire Agreement; No Third-Party Beneficiaries.
This Agreement (together with the Confidentiality Agreement) constitutes the
entire agreement, and supersedes all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter of this
Agreement (except for the Confidentiality Agreement). Other than the provisions
of Sections 2.08 and 6.08, this Agreement is not intended to confer upon any
person (including, without limitation, any current or former employees of the
Company), other than the parties hereto, any rights or remedies; provided that
the persons (other than the parties hereto) referred to in the provisions of
Section 2.08 or 6.08 shall be third-party beneficiaries of such provisions and,
in addition, the persons (other than the parties hereto) referred to in the
provisions in Section 2.08 or 6.08 shall be entitled to receive from Parent
their reasonable costs and expenses arising out of any breach by Parent or the
Surviving Corporation of such provisions.
SECTION 9.05 Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Delaware,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof.
SECTION 9.06 Assignment. Neither this Agreement nor any of the
rights, interests or obligations under this Agreement may be assigned or
delegated, in whole or in part, by operation of law or otherwise by any of the
parties without the prior written consent of the other parties, and any such
assignment without such prior written consent shall be null and void, except
that Parent and/or Purchaser may assign this Agreement to any direct or indirect
wholly owned Subsidiary of Parent without the prior consent of the Company;
provided that Parent and/or Purchaser, as the case may be, shall remain liable
for all of its obligations under this Agreement. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of, and be
enforceable by, the parties and their respective successors and assigns.
SECTION 9.07 Enforcement. The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. Accordingly, the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in the Court of Chancery in and for
New Castle County in the State of Delaware (or, if such court lacks subject
matter jurisdiction, any appropriate state or federal court in New Castle County
in the State of Delaware), this being in addition to any other remedy to which
they are entitled at law or in equity. Each of the parties hereto (i) shall
submit itself to the personal jurisdiction of the Court of Chancery in and for
New Castle County in the State of Delaware (or, if such court lacks subject
matter jurisdiction, any appropriate state or federal court in New Castle County
in the State of Delaware) with respect to any dispute that arises out of this
Agreement or any of the transactions contemplated hereby, (ii) shall not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court, and (iii) shall not bring any action relating to this
Agreement or any of the transactions contemplated hereby in any court other than
the Court of Chancery in and for New Castle County in the State of Delaware (or,
if such court lacks subject matter jurisdiction, any
44
<PAGE> 52
appropriate state or federal court in New Castle County in the State of
Delaware). By execution and delivery of this Agreement, Parent appoints The
Corporation Trust Company at 1209 Orange Street, Wilmington, Delaware 19801 as
its agent upon which process may be served in any such legal action or
proceeding.
SECTION 9.08 Waiver of Jury Trial. Each of the parties hereto
hereby waives to the fullest extent permitted by applicable law any right it may
have to a trial by jury with respect to any litigation directly or indirectly
arising out of, under or in connection with this Agreement or the Offer and
Merger. Each of the parties hereto (a) certifies that no representative, agent
or attorney of any other party hereto has represented, expressly or otherwise,
that such other party would not, in the event of litigation, seek to enforce the
foregoing waiver and (b) acknowledges that it and the other parties hereto have
been induced to enter into this Agreement and the Offer and Merger, as
applicable, by, among other things, the mutual waivers and certifications in
this Section 9.08.
SECTION 9.09 Severability. Whenever possible, each provision
or portion of any provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
or portion of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement shall be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision had
never been contained herein.
SECTION 9.10 Counterparts. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
instrument and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other parties.
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<PAGE> 53
IN WITNESS WHEREOF, Parent, Purchaser and the Company have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.
VNU N.V.
By: /s/ R. F. van den Bergh
--------------------------------------------
Name: R. F. van den Bergh
Title: CEO
By: /s/ T.G.G. Bouwman
--------------------------------------------
Name: T.G.G. Bouwman
Title: Member of the Executive Board
ARTIST ACQUISITION, INC.
By: /s/ James Ross
--------------------------------------------
Name: James Ross
Title: Secretary
ACNIELSEN CORPORATION
By: /s/ Nicholas L. Trivisonno
--------------------------------------------
Name: Nicholas L. Trivisonno
Title: Chairman & Chief Executive Officer
46
<PAGE> 54
SCHEDULE A
EXECUTIVE EMPLOYEES
Mr. Nicholas L. Trivisonno
Mr. Michael P. Connors
Mr. Earl H. Doppelt
Mr. Robert J. Chrenc
Mr. Maury Pages
Mr. K.N. Tang
Mr. Steven M. Schmidt
Mr. Brian D. Chadbourne
<PAGE> 55
SCHEDULE B
LIST OF SUBSIDIARIES
<PAGE> 56
DISCLOSURE SCHEDULE
<PAGE> 57
EXHIBIT A
CONDITIONS TO THE OFFER
Capitalized terms used but not defined herein shall have the
meanings set forth in the Agreement and Plan of Merger (the "Agreement") of
which this Exhibit A is a part. Notwithstanding any other provision of the Offer
and subject to the terms of the Agreement, Purchaser shall not be required to
accept for payment or, subject to any applicable rules and regulations of the
SEC, including Rule 14e-1(c) under the Exchange Act (relating to Purchaser's
obligation to pay for or return tendered Shares promptly after termination or
withdrawal of the Offer), pay for, and may delay the acceptance for payment of
or, subject to the restriction referred to above, the payment for, any tendered
Shares, and may amend the Offer consistent with the terms of the Agreement or
terminate the Offer and not accept for payment any tendered Shares, if:
(a) immediately prior to the expiration of the Offer, the
Minimum Condition shall not have been satisfied,
(b) (i) the European Commission shall not have issued a
decision under Article 6(1)(b) or 8(2) of the EC Merger Regulation (or
shall not have been deemed to have done so under Article 10(6) of the
EC Merger Regulation) declaring the Offer and the Merger compatible
with the EC common market and (ii) any applicable waiting period under
the HSR Act and, if required, the CAC shall not have expired or been
terminated,
(c) none of the following conditions shall have been
satisfied: (i) Parent shall have received the unconditional positive
advice of the Works' Council regarding the intent by Parent to enter
into the bank facility to be entered into by Parent in connection with
the financing of the Offer (the "Facility") and the issuance of the
guarantee of Parent related thereto (the "Facility Guarantee") (any
such unconditional positive advice referred to herein as "Positive
Advice"); or (ii) Parent shall have received conditional positive
advice of the Works' Council with respect to the Facility and the
Facility Guarantee and the fulfillment of the conditions specified
therein would not result in material detriment to Parent and its
Subsidiaries, or result in material restrictions on the business
activities thereof (any such conditional positive advice referred to
herein as "Acceptable Conditional Advice"); or (iii) Parent shall have
received written advice from the Works' Council that is not Positive
Advice or Acceptable Conditional Advice regarding the Facility to be
entered into and the Facility Guarantee to be issued and either (A) 35
days shall have elapsed from the date that Parent has notified the
Works' Council of its intention to enter into the Facility and issue
the Facility Guarantee, provided that the Works' Council shall not have
commenced any appeal or other legal proceeding in respect of the
Facility or the Facility Guarantee or (B) the Works' Council shall have
notified Parent in writing or publicly announced that it will disclaim
its right to appeal or take any other legal action in connection with
the Facility to be entered into or the Facility Guarantee to be issued,
or
(d) the Agreement shall have been terminated in accordance
with its terms, or
<PAGE> 58
(e) at any time on or after the date of the Agreement and
prior to the Expiration Date, any of the following events shall occur
and be continuing and shall not have resulted from the breach by Parent
or Purchaser of any of their obligations under the Agreement:
(i) there shall be any statute, rule, regulation,
judgment, order or injunction enacted, entered, enforced,
promulgated or deemed applicable to the Offer or the Merger,
that shall (A) prohibit or impose any material limitations on
Parent's or Purchaser's ownership or operation (or that of any
of their respective Subsidiaries or affiliates) of all or a
material portion of their or the Company's businesses or
assets, (B) challenge the acquisition by Parent or Purchaser
of any Shares pursuant to the Offer, (C) prohibit the making
or consummation of the Offer or the Merger or the performance
of any of the transactions contemplated by the Agreement, or
(D) impose material limitations on the ability of Purchaser,
or render Purchaser unable, to accept for payment, pay for or
purchase some or all of the Shares pursuant to the Offer and
the Merger, or effectively to exercise full rights of
ownership of the Shares, including, without limitation, the
right to vote the Shares purchased by Purchaser or Parent on
all matters properly presented to the Company's stockholders;
or
(ii) (A) any representation or warranty of the
Company contained in the Agreement that is qualified as to
Material Adverse Effect shall not be true and correct, or (B)
any representation or warranty of the Company in the Agreement
that is not so qualified shall not be true and correct in all
material respects, in each case as of the date of consummation
of the Offer as though made on or as of such date (other than
representations and warranties that by their terms address
matters only as of another specified date, which shall be true
and correct only as of such other specified date) except where
(1) the failure of such representations and warranties (other
than those relating to the number of shares and/or options,
warrants or other rights to acquire capital stock set forth in
Section 3.04 of the Agreement) referred to in clause
(e)(ii)(B) to be so true and correct, in the aggregate, have
not had and would not reasonably be expected to have a
Material Adverse Effect on the Company or (2) where the
failure of such representations and warranties relating to the
number of shares and/or options, warrants or other rights to
acquire capital stock set forth in Section 3.04 of the
Agreement to be so true and correct would not, in the
aggregate, relate to an inaccuracy in excess of 150,000 shares
and/or options, warrants or other rights to acquire capital
stock; or
(iii) the Company shall have breached or failed in
any material respect to perform any material obligation or to
comply with any material agreement or covenant of the Company
to be performed by or complied with by it under the Agreement;
or
(iv) there shall have occurred (A) any general
suspension of trading in, or limitation on prices for,
securities on the New York Stock Exchange or in the Nasdaq
National Market System, for a period in excess of three hours
(excluding suspensions or limitations resulting solely from
physical damage or interference
2
<PAGE> 59
with such exchanges not related to market conditions), (B) a
declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States or outside
the United States (whether or not mandatory), (C) any
limitation (whether or not mandatory) by any United States or
foreign governmental authority on the extension of credit by
banks or other financial institutions or (D) in the case of
any of the foregoing existing at the time of the commencement
of the Offer, a material acceleration or worsening thereof; or
(v) except as disclosed in the Filed SEC Documents or
in Section 3.06 of the Disclosure Schedule, there shall have
occurred an event, change, occurrence, or development of a
state of facts or circumstances having, or which would
reasonably be expected to have, a Material Adverse Effect on
the Company,
that in the reasonable judgment of Parent or Purchaser, in any such
case, and regardless of the circumstances (including any action or
inaction by Parent or Purchaser) giving rise to such condition, makes
it inadvisable to proceed with the Offer and/or with such acceptance
for payment of, or payment for, Shares.
Subject to the terms of the Agreement, the foregoing
conditions are for the sole benefit of Parent and Purchaser and may be waived by
Parent or Purchaser, in whole or in part, at any time and from time to time, in
the sole discretion of Parent or Purchaser. The failure by Parent or Purchaser
at any time to exercise any of the foregoing rights shall not be deemed a waiver
of any right and each such right shall be deemed an ongoing right which may be
asserted at any time and from time to time.
3
