DATED 23rd March, 2000
THE DIALOG CORPORATION plc
and
THE THOMSON CORPORATION
------------------------------
SALE AND PURCHASE AGREEMENT
in respect of the information services
division of the Seller and the entire
issued share capitals of
The Dialog Corporation
and certain other companies
------------------------------
ALLEN & OVERY
London
CO:715784.7
<PAGE>
<TABLE>
<CAPTION>
CONTENTS
CLAUSE Page
<S> <C> <C>
1. Interpretation.......................................................................................1
2. Sale and purchase....................................................................................6
3. Consideration........................................................................................7
4. Adjustment to consideration..........................................................................8
5. Conditions precedent................................................................................10
6. Warranties..........................................................................................11
7. limitation on the Seller's liability................................................................13
8. Covenants up to Completion..........................................................................16
9. Rescission..........................................................................................18
10. Tax Deed............................................................................................18
11. Subscription........................................................................................18
12. Contracts and creditors.............................................................................19
13. Completion..........................................................................................20
14. Guarantees..........................................................................................21
15. Business sale employees.............................................................................21
17. Protective covenants................................................................................24
18. Announcements.......................................................................................25
19. Value Added Tax.....................................................................................25
20. Interest............................................................................................27
21. Notices.............................................................................................27
22. Resolutions and waivers.............................................................................28
23. General.............................................................................................28
24. Whole agreement.....................................................................................30
25. Domain names........................................................................................30
26. Governing law.......................................................................................30
SCHEDULE
1. Companies and Subsidiaries..........................................................................32
2. Allocation of Consideration for the Shares and Assets...............................................57
3. Completion Balance Sheet............................................................................58
4. Properties..........................................................................................62
5. Share Sale Warranties...............................................................................74
6. Business Sale Warranties...........................................................................104
7. Completion Arrangements............................................................................121
8. Business Intellectual Property.....................................................................123
9. Business Sale Employees............................................................................124
10. Domain Names.......................................................................................125
</TABLE>
<PAGE>
Documents to accompany agreement:
(1) Audited Accounts of the Companies
(2) Disclosure Letter
and Agreed Forms of:
(1) Tax Deed
(2) Distribution Agreement
(3) Software Licence and Maintenance Agreement
(4) Combined circular and Listing Particulars
(5) Undertakings to vote in favour of resolutions
(6) Domain name assignment
(7) Trade mark assignment
(8) Bond Proposed Amendments
(9) Bank Payoff letter
<PAGE>
1
THIS AGREEMENT is made on 23rd March, 2000 BETWEEN:
(1) THE DIALOG CORPORATION PLC (registered number 1890236) whose registered
office is at The Communications Building, 48 Leicester Square, London
WC2H 7DB (the "Seller"); and
(2) THE THOMSON CORPORATION having its principal office at Suite 2706,
Toronto Dominion Bank Tower, Toronto Dominion Centre, Toronto, Ontario
M5K 1A1, Canada (the "Purchaser").
WHEREAS:
(A) The Seller carries on the Business (as defined below).
(B) The Seller is the owner of the entire issued share capitals of the
Companies listed in Schedule 1 Part B, Dotcom Investments BV
("Dotcom"), The Dialog Corporation ("Dialog Corp") and The Dialog
Corporation Asia Pacific Limited and the relevant proportion of the
issued share capital of The Dialog Corporation Srl ("Srl") and an
interest in Frost & Sullivan Electronic Distribution LLC ("LLC")
further details of which are set out in Schedule 1 Part A.
(C) Dotcom is the owner of the entire issued share capitals of the
companies details of which are set out in Schedule 1 Part C ("Dotcom
Subsidiaries").
(D) Dialog Corp is the owner of the entire issued share capitals of the
companies details of which are set out in Schedule 1 Part D.
(E) The Seller wishes to sell and, in reliance upon, inter alia, the
representations, warranties and undertakings set out in this agreement,
the Purchaser wishes to procure the purchase of the Business with a
view to carrying on the Business as a going concern in succession to
the Seller on the terms and subject to the conditions set out in this
agreement.
(F) The Seller wishes to sell or procure that the sale of, and, in reliance
upon, inter alia, the representations, warranties and undertakings set
out in this agreement, the Purchaser wishes to purchase or procure the
purchase of all the issued share capital of Dialog Corp and The Dialog
Corporation Asia Pacific Limited, the UK Subsidiaries, the Dotcom
Subsidiaries and the relevant proportions of the issued share capital
of Srl and LLC on the terms and subject to the conditions set out in
this agreement.
IT IS AGREED as follows:
1. Interpretation
(1) In this agreement:
"1999 ISD Accounts" means the unaudited combined profit and loss
account, for the Companies and the Business for the year ended 31st
December, 1999 and the unaudited combined net asset statement for the
Companies and the Business as at 31 December 1999 after elimination of
inter-company balances as set out in the circular and listing
particulars in an Agreed Form;
"Accounts" means the audited balance sheets as at the Accounts Date and
audited profit and loss accounts for the year ended on that date of the
Companies and the notes and directors' reports relating to them
(including in the case of the Seller the audited consolidated balance
sheet and the audited consolidated profit and loss account as at the
Accounts Date), a copy of
<PAGE>
2
each of which has been initialled for the purpose of identification by
the Seller and the Purchaser but so that where such Company is not
required to prepare audited accounts the financial statements used in
the preparation of the Seller's 1998 audited accounts to the extent
that such financial statements are readily available;
"Accounts Date" means 31st December, 1998;
"Actual Completion" means, in relation to any Property the Property
Transfer of which is not completed at Completion, the date of actual
completion of that Property Transfer;
"Agreed Form" means, in relation to any document, the form of that
document which has been initialled for the purpose of identification by
the Seller's Solicitors and the Purchaser's Solicitors;
"Assets" means the Business Intellectual Property, the Contracts, the
Debts, the Equipment, the Properties, the Goodwill, the Information and
the Stocks, the Domain Names and the interest of the Seller in LLC to
be sold by the Seller to the Purchaser under this agreement and any
other property and assets of the Seller used in connection with the
Business except the Excluded Assets;
"Business" means the business of the Information Services Division as
carried on by the Seller which comprises the business of "Dialog",
"Profound" and "DataStar";
"Business Day" means a day (not being a Saturday or Sunday) when banks
are open for general business in London and New York;
"Business Intellectual Property" means all Intellectual Property Rights
owned by the Seller or any member of the Seller's Group and used in
connection with the Business excluding all Intellectual Property Rights
included in the Excluded Assets but including (but without limitation)
those items of Intellectual Property Rights shortly described in
Schedule 8;
"Business Sale Employees" means those individuals employed by the
Seller wholly or mainly in the Business and named in Schedule 9;
"Companies" means all the companies named in Schedule 1 and "Company"
means any one of the Companies;
"Completion" means completion of the sale and purchase in accordance
with clause 13;
"Contracts" means all contracts and engagements (other than (i) the
Leases and the Occupation Leases and (ii) the employment contracts of
the Business Sale Employees) entered into or orders made before the
Effective Time by or on behalf of the Seller with third parties in
connection with the Business which remain (in whole or in part) to be
performed at the Effective Time including (but without limitation) all
orders and contracts for the manufacture, sale or purchase of goods or
provision or supply of services including, for the avoidance of doubt,
all contracts for the supply of services by independent contractors or
for the hire purchase, credit sale, leasing or license of goods or
services, or the licensing of Intellectual Property Rights;
"Creditors" means those amounts owing by the Seller in connection with
the Business to creditors at the Effective Time and included in the
calculation of Net Assets;
<PAGE>
3
"Debts" means any debts or other sums due or payable to the Seller in
connection with the Business at the Effective Time and included in the
calculation of Net Assets;
"Disclosure Letter" means the letter of the same date as this agreement
from the Seller to the Purchaser;
"Disclosed Matters" means any fact, matter, event or circumstance which
is fairly disclosed in this agreement, the Disclosure Letter or the
documents attached to the Disclosure Letter;
"Domain Names" means the internet domain names shown in the list of
domain names in Schedule 10 of this Agreement, against the name of "
Plc", "M.A.I.D." and "other";
"Effective Time" means the opening of business (London Time) on the
date of Completion;
"Employment Regulations" means the Transfer of Undertakings (Protection
of Employment) Regulations 1981 as amended;
"Equipment" means all the computer hardware, equipment, tangible
chattels, motor vehicles, furniture, fixtures and fittings (to the
extent they are not included in the Properties) used by the Seller and
any other member of the Seller's Group in connection with the Business;
"Excluded Assets" has the meaning assigned to it in clause 2(8);
"Goodwill" means the goodwill of the Business with the exclusive right
to carry on the Business in succession to the Seller;
"Information" means all information owned by the Seller relating to the
Business including (but without limitation) industrial and commercial
information and techniques including (but not limited to) drawings,
formulae, test reports, operating and testing procedures, shop
practices, instruction manuals and tables of operating conditions and
including all information relating to the marketing of any products or
services supplied by the Business, including customer names and lists,
sales targets, sales statistics, market share statistics, marketing
surveys and reports, marketing research and any advertising or other
promotional materials;
"Insolvency Act" means the Insolvency Act 1986;
"Intellectual Property Rights" means trade marks, service marks, trade
and business names, rights in designs, patents, copyright, database
rights, moral rights and rights in know-how and other intellectual
property rights in each case whether registered or unregistered and
including applications for the grant of any of the foregoing and all
rights or forms of protection having equivalent or similar effect to
any of the foregoing which may subsist anywhere in the world;
"Jiyu Shares" means the 7,038,123 ordinary shares of 1 pence each in
the capital of the Seller agreed to be subscribed by Jiyu Holdings
Limited pursuant to a subscription agreement between that Company and
the Seller of the same date as this agreement;
"Land" includes land, mines and minerals (whether or not owned
separately from the surface) buildings or parts of buildings (whether
the division is horizontal, vertical or made in any other way) and a
right, privilege or benefit in, over or derived from land;
"Leases" mean leases of lands, rights of occupation or uses of land
shortly described in Part II of Schedule 4 and "Lease" means any one of
them and includes every part of each of them and the property therein
demised;
<PAGE>
4
"Material Adverse Effect" means any circumstances, change in, or effect
on, the Business or the Companies as a whole that, individually or in
the aggregate with any other circumstances, changes in or effects on,
the Business or the Companies as a whole:
(a) is, or could be, materially adverse to the business,
operations, assets or liabilities (including, without
limitation, contingent liabilities), employee
relationships, customer or supplier relationships
results or operations or the condition (financial or
otherwise) of the Companies' businesses and the
Business taken as a whole; or
(b) could materially adversely affect the ability of the
Purchaser to operate or conduct the business of the
Companies and the Business taken as a whole in the
manner in which they are currently operated or
conducted by the Companies and the Seller.
"Material Contracts" has the meaning assigned to it in Clause C.1 of
Schedule 5.
"New Shares" has the meaning assigned to it in clause 11;
"Nominated Purchaser" means that member or those members of the
Purchaser's Group which the Purchaser nominates prior to the sale and
purchase of the Shares and Assets becoming unconditional as being the
actual purchaser or purchasers of the Business and Assets and/or the
Shares;
"Planning Acts" means the Town and Country Planning Act 1990, the
Planning (Listed Buildings and Conservation Areas) Act 1990, the
Planning (Hazardous Substances) Act 1990, the Planning (Consequential
Provisions) Act 1990 and the Planning and Compensation Act 1991;
"Properties" means the leasehold properties shortly described in Part I
of Schedule 4 and "Property" means any of them and includes every part
of each of them;
"Property Completion" means, in respect of each Leasehold Property to
which paragraph (5) of Part III of Schedule 4 applies, the date for
completion of the sale and purchase of that Leasehold Property as
provided for in that paragraph;
"Property Transfer" means the conveyance, assignment or transfer of the
relevant UK Property to the Purchaser;
"Purchaser's Accountants" means PricewaterhouseCoopers of 1 Embankment
Place, London WC2N 6NN;
"Purchaser's Group" means the Purchaser and its subsidiaries;
"Purchaser's Solicitors" means Allen & Overy of One New Change, London
EC4M 9QQ;
"Reseller Agreement" means the distribution agreement in the Agreed
Form between the Seller and the Purchaser;
"Seller's Accountants" means PricewaterhouseCoopers of 1 Embankment
Place, London WC2N 6NN;
"Seller's Solicitors" means Theodore Goddard of 150 Aldersgate Street,
London EC1A 4EJ;
<PAGE>
5
"Seller's Group" means the Seller and its subsidiaries other than the
Companies;
"Shares" means all the issued shares of the Companies named in Schedule
1 Parts A, B and C except for Srl where it means all the shares
registered in the name of the Seller as set out in Schedule 1 Part A;
"Software Licence and Maintenance Agreement" means the software licence
and maintenance agreement between the Seller and the Purchaser in the
Agreed Form;
"Stocks" means the stocks of headed paper and logo paper, marketing
materials, stationery and CD's owned by Business at the Effective Time;
"subsidiary" means a subsidiary for the purposes of the Companies Act
1985; and
"Subsidiaries" means all the companies mentioned in Schedule 1, Parts
B, C and D and "Subsidiary" means any of them;
"TCGA 1992" means Taxation of Chargeable Gains Act 1992;
"Tax" or "Taxation" means all forms of taxation, duties, imposts and
levies, whether of the United Kingdom or elsewhere, that may be
charged, imposed, administered or collected by any Taxation Authority
including but without limitation income tax (including income tax or
amounts equivalent to or in respect of income tax required to be
deducted or withheld from or accounted for in respect of any payment),
corporation tax, advance corporation tax, capital gains tax, capital
transfer tax, inheritance tax, value added tax, sales/use tax, customs
and other import or export duties, excise duties, stamp duty, stamp
duty reserve tax, development land tax, any amount in respect of PAYE,
national insurance, social security or other similar contributions, and
any interest, penalty, surcharge or fine in connection with it;
"Tax Deed" means the Tax Deed in the Agreed Form;
"Taxes Act 1988" means Income and Corporation Taxes Act 1988;
"US Company" means any Company organised in a jurisdiction of the
United States of America and "US Companies" means all of them.
"US Debt" means the principal sum of US$160,000,000 (excluding any
interest) owing by the Dialog Corp to the Seller after the
capitalisation referred to in paragraph 1(o) of Schedule 7;
"US$" or "US Dollars" means United States dollars, the lawful currency
of the United States of America;
"VAT" means value added tax or other similar sales tax whether of the
United Kingdom or elsewhere;
"VATA 1994" means the Value Added Tax Act 1994; and
"Warranties" means the representations and warranties on the part of
the Seller contained in clause 6(1) and Schedules 5 and 6.
<PAGE>
6
(2) In this agreement any reference, express or implied, to an enactment
includes references to:
(a) that enactment as amended, extended or applied by or under any
other enactment in force at the date hereof and includes;
(b) any enactment which that enactment re-enacts (with or without
modification) which is in force at the date hereof; and
(c) any subordinate legislation made before signature of this
agreement under any enactment, as re-enacted, amended,
extended or applied as described in paragraph (a) above, or
under any enactment referred to in paragraph (b) above;
and "enactment" includes any legislation in any jurisdiction.
(3) Where any statement is qualified by the expression "so far as the
Seller is aware" or "to the best of the Seller's knowledge, information
and belief" or any similar expression that statement shall be deemed to
include an additional statement that it has been made after due and
careful enquiry of the officers of the Seller, Dialog Corp and Dialog
Corp GmbH (Switzerland).
(4) A person shall be deemed to be connected with another if that person is
connected with another within the meaning of section 839 of the Taxes
Act 1988.
(5) Words denoting persons shall include bodies corporate and
unincorporated associations of persons.
(6) Subclauses (1) to (5) above apply unless the contrary intention
appears.
(7) The headings in this agreement do not affect its interpretation.
2. Sale and purchase
(1) Subject to clause 5, the Seller shall sell, or shall procure the sale
of, and the Purchaser shall purchase or shall procure the purchase of,
the Shares together with all rights attaching to them.
(2) The Seller covenants with the Purchaser as follows:
(a) that it has or will have at Completion the right to sell or
procure the sale of, and transfer the full legal and
beneficial interest in, the Shares to the Purchaser on the
terms set out in this agreement; and
(b) that on or after Completion it will, at its own cost and
expense, execute and do (or procure to be executed and done by
any other necessary party) all such deeds, documents, acts and
things as the Purchaser may from time to time require in order
to vest any of the Shares in the Purchaser or its assignee or
as otherwise may be necessary to give full effect to this
agreement.
(3) The Shares shall be sold free from all liens, charges, equities and
encumbrances and other rights exercisable by third parties.
(4) Subject to Clause 5, the Seller shall sell and the Purchaser shall
purchase or shall procure the purchase of the Assets with a view to the
Purchaser carrying on the Business from Completion as a going concern
in succession to the Seller.
<PAGE>
7
(5) The Seller shall sell the Assets (except the Properties) free from all
liens, charges and encumbrances and other rights exercisable by third
parties and property and risk in those Assets shall vest in the
Purchaser on Completion.
(6) The Seller covenants with the Purchaser as follows:
(a) that it has or will have at Completion the right to sell and
transfer the full legal and beneficial interest in the Assets
(except the Properties) to the Purchaser on the terms set out
in this agreement; and
(b) that on or after Completion it will, at its own cost and
expense, execute and do (or procure to be executed and done by
any other necessary party) all such deeds, documents, acts and
things as the Purchaser may from time to time reasonably
require in order to vest any of the Assets (except the
Properties) in the Purchaser or its assignee or as otherwise
may be necessary to give full effect to this agreement.
(7) The Properties shall be sold on and subject to the special conditions
contained in Part IV of Schedule 4 and the Leases shall be sold (where
relevant) subject to the special conditions contained in Part V of
Schedule 4.
(8) Nothing in this agreement shall operate to transfer to the Purchaser
any of the following (which, together, shall be referred to in this
agreement as the "Excluded Assets"):
(a) all assets and liabilities of the Web Solutions Division of
the Seller including but not limited to all rights associated
with or relating to InfoSort, Muscat WebCheck, k-working and
WebTop technologies;
(b) all assets and liabilities of the eCommerce Division including
but not limited to all rights associated with or relating to
Sparza technology and Office Shopper of the Seller;
(c) Dialog Corp's entire interest in Teltech Resource Network
Corporation;
(d) the Seller's direct shareholding in Zawya.com Limited and the
Seller's investment in London Financial News;
(e) all rights to Tax refunds or credits relating to the Business
as carried on by the Seller or the Assets in relation to Tax
periods (or parts thereof) ending on or prior to Completion;
(f) the statutory books and records of the Seller;
(g) the benefit of this agreement.
(9) The Purchaser shall not be obliged to complete the purchase of any of
the Shares and the Assets unless the purchase of all the Shares and all
the Assets is completed simultaneously in accordance with this
agreement.
3. Consideration
The aggregate consideration for the sale of the Shares and the Assets
effected by this agreement (the "Consideration") shall be (subject to
adjustment in accordance with clause 4) the sum of US$115,000,000 which
shall be allocated in the a manner set out in Schedule 2. The
Consideration shall be payable in cash on Completion.
<PAGE>
8
4. Adjustment to Consideration
(1) The Consideration shall be adjusted following Completion if the Working
Capital Adjustment (defined below) is:
(a) less than nil, by deducting the amount of the Working Capital
Adjustment; or
(b) greater than nil, by adding the amount of the Working Capital
Adjustment.
(2) In this clause "Working Capital Adjustment" shall mean:
(a) the movement in Working Capital from 31st December 1999 to
Completion where "Working Capital" means the aggregate amount
of the assets (except the Excluded Working Capital Assets)
less the aggregate amount of the liabilities (except the
Excluded Liabilities)of each of the Companies and the Seller
in relation to the Business to be acquired as at Completion as
shown in the Completion Working Capital Statement prepared in
accordance with Schedule 3; plus
(b) amounts paid since 31st December 1999 and prior to Completion
by a Company or by the Seller in relation to the Business in
respect of the acquisition of Tangible Fixed Assets which, for
the purpose of this clause shall include items normally
recognised as tangible fixed assets in a company's books and
records and which includes, for the avoidance of doubt,
software licences acquired from third parties and other
tangible fixed assets in accordance with FRS 15 but shall
exclude all internal costs capitalised, plus in respect of
amounts paid in reducing opening provisions excluding those in
connection with the Carl/Ryan litigation; plus
(c) the principal amount owing in relation to the Carl/Uncover
Loan Note which, for the avoidance of doubt, will be treated
as a Dialog asset as at 31st December, 1999 but will be
transferred to the Purchaser on Completion.
(3) "Excluded Working Capital Assets" means all fixed assets of the
Companies and of the Seller in relation to the Business including
intangible fixed assets, goodwill, tangible fixed assets and fixed
asset investments, plus any deferred royalty assets and deferred
indexing costs.
(4) "Excluded Liabilities" means all overdue obligations of the Companies
or of the Seller in relation to the Business to the Purchaser and any
member of the Purchaser's Group, all provisions for liabilities and
charges, deferred income, all obligations in respect of the acquisition
of Tangible Fixed Assets (but not excluding any finance lease
obligations of the Companies or of the Seller in relation to the
Business) and any intercompany balances, in each case of the Companies
and the Seller in relation to the Business.
(5) The Seller represents and warrants to the Purchaser that the statement
of Working Capital as at 31st December 1999 set out in Part B of
Schedule 3 is true and accurate and is to the same effect as if that
statement had been prepared in accordance with Schedule 3. If and to
the extent that it is determined that such statement of Working Capital
does not accord with the previous sentence, the Working Capital as at
31st December, 1999 shall be determined for the purposes of this clause
as if such statement did so accord.
(6) Between five and two days prior to Completion the parties shall, acting
in good faith, agree a best estimate of the likely amount of the
Working Capital Adjustment to be made in
<PAGE>
9
accordance with this clause (the "Estimated Working Capital
Adjustment"). If the Estimated Working Capital Adjustment is:
(a) greater than nil (the "Excess") the sum payable by the
Purchaser to the Seller on Completion shall be increased pound
((pound)) for pound ((pound)) by the amount of the Excess;
or
(b) less than nil (the "Shortfall") the sum payable by the
Purchaser to the Seller on Completion shall be reduced pound
((pound)) for pound ((pound)) by the amount of the Shortfall.
(7) Within seven days following the day on which the Completion Working
Capital Statement is agreed or determined in accordance with Schedule 3
(the "Determination Date"), the Seller shall pay to the Purchaser or
the Purchaser shall pay to the Seller (as appropriate) in cash the
amount of the difference between the Estimated Working Capital
Adjustment received by the Seller on Completion and the actual amount
of the Working Capital Adjustment as so calculated together with
interest accruing daily on such amount at the rate of 2% above the base
rate of The Royal Bank of Scotland PLC from Completion to (and
including) the Determination Date and at the rate of 4% above the base
rate of The Royal Bank of Scotland PLC from the Determination Date to
(but not including) the date of payment.
(8) In preparing the Completion Working Capital Statement all non-pounds
sterling amounts shall be converted into pounds Sterling at the rates
quoted by The Royal Bank of Scotland PLC at the opening of business
London Time on the date of Completion. For the purpose of calculating
any adjustment to the Consideration payable pounds sterling shall be
converted into US Dollars at the rates quoted by The Royal Bank of
Scotland PLC at the opening of Business London Time on the date of
Completion.
(9) If Completion shall take place five Business Days or less before or
after the close of business on the last day of a month ("Month End"),
the Completion Working Capital Statement shall be prepared, and the
Working Capital Adjustment shall be calculated, as at the Month End,
not as at Completion.
(10) If Completion shall take place before the Month End, the Purchaser
shall pay to the Seller an amount equal to cash received by the
Purchaser in respect of the Business and by the Companies between
Completion and the Month End less the aggregate amount of payments made
by the Purchaser in the ordinary course of the Business and by the
Companies in the ordinary course of business between Completion and the
Month End.
(11) If Completion shall take place after the Month End, the Seller shall
pay to the Purchaser an amount equal to cash received by the Seller in
respect of the Business and by the Companies between Completion and the
Month End less the aggregate amount of payments made by the Seller in
the ordinary course of the Business and by the Companies in the
ordinary course of their business between Completion and the Month End.
(12) If in relation to subclause (10) or (11) the cash received is less than
the payments made then the net payment will be made by the party other
than the party required to make payment under subclause (10) or (11)
(as the case may be).
(13) If Completion shall take place before the Month End the Seller shall
pay to the Purchaser an amount in respect of interest on the
Consideration plus the amount of the US Debt (which shall accrue daily)
for the period from the date of Completion to the Month End at the base
rate from time to time of The Royal Bank of Scotland PLC.
<PAGE>
10
(14) If Completion shall take place after the Month End the Purchaser shall
pay to the Seller an amount in respect of interest on the Consideration
plus the amount of the US Debt (which shall accrue daily) for the
period from the Month End to Completion at the base rate of The Royal
Bank of Scotland PLC.
(15) The Purchaser shall pay to the Seller as soon as reasonably practicable
after receipt the amount of interest received in respect of the
Carl/Uncover Loan Note in respect of the period ending on the date
immediately prior to Completion (less the amount of any tax that may
have to be deducted from such amount).
5. Conditions precedent
(1) Without prejudice to clause 9 (Rescission) the sale and purchase of the
Shares and the Assets is conditional on:
(a) resolutions to approve inter alia the sale of the Shares and
the Assets pursuant to this agreement as set out in the draft
combined circular to shareholders and listing particulars of
the Seller in the Agreed Form;
(b) all filings having been made and all or any appropriate
waiting periods (including any extensions thereof) under the
US Hart Scott Rodino Antitrust Improvements Act of 1976 having
expired, lapsed or been terminated as appropriate in each case
in respect of the purchase of the Shares and the Assets;
(c) the London Stock Exchange agreeing to admit the New Shares and
the Jiyu Shares to listing (subject only to allotment);
(d) (i) the Seller having received consents to the adoption of the
Proposed Amendments (as defined in the Offer to Purchase and
Consent Solicitation Statement (as amended, supplemented or
otherwise modified but in any event substantially in the
Agreed Form, the "Offer/Solicitation")) from the holders
holding a majority of the outstanding principal amount of the
11% Senior Subordinated Notes due 2007 (the "Notes") issued
pursuant to the indenture (the "Indenture") dated as of 10
November, 1997; (ii) the Trustees (as defined in the
Indenture) having executed the supplemental indenture to the
Indenture providing for the Proposed Amendments; and (iii)
holders holding at least 95% (or such lesser percentage as the
Seller may agree but not less than a majority) of the
outstanding principal amount of the Notes having tendered, and
not withdrawn, their Notes for redemption pursuant to, and in
accordance, with the terms and conditions of the Indenture;
(e) each of the Banks and the Facility Agent (as such terms are
defined in the Facility Agreement dated as of 17 October, 1997
(as amended, supplemented or otherwise modified through the
date of this agreement, the "Facility Agreement")) having
executed and delivered the letter agreement (as amended,
supplemented or otherwise modified through the date of
Completion but in any event substantially in the Agreed Form,
the "Payoff Letter") among and between the Seller, on the one
hand, and such Banks and Facility Agent, on the other,
containing the agreement of the Banks and the Facility Agent
to release their security over the Shares and the Assets
against repayment of all amounts owed to them;
(f) no transfer of any interest in the Intellectual Property
Rights of Dialog Corp to the Seller or any other member of the
Seller's Group having taken place, since 1st March, 2000 and
the Facility Agent (as so defined) confirming in writing to
the Purchaser that no such transfer has taken place; and
<PAGE>
11
(g) receipt of approval from the German Federal Cartel Office
(Bundeskartellamt) for the acquisition of The Dialog
Corporation GmbH on terms reasonably satisfactory to the
Purchaser or expiry of all relevant waiting periods.
(2) The Seller shall procure that the circular to its shareholders is
approved by the London Stock Exchange as soon as practicable following
the date of this agreement and shall procure the posting to its
shareholders no later than the Business Day following such approval of
a circular containing, subject to their fiduciary duties, a
recommendation in the Agreed Form by the directors of the Seller to
such shareholders to vote in favour of the sale of the Shares and the
Assets to the Purchaser.
(3) If all the conditions in subclause (1) above are not fulfilled or
waived on or before 15th June, 2000 all the preceding clauses and
clauses 6 to 17 (inclusive) of this agreement shall cease to have
effect and neither party will have any rights or liabilities under
those clauses.
(4) The Seller agrees that if the condition in subclause (1)(a) is not
satisfied and the directors of the Seller shall have ceased to
recommend the sale of the Shares and Assets to the Purchaser then it
shall forthwith pay the sum of US$2,750,000 to the Purchaser as
compensation for the costs and expenses of the Purchaser in connection
with the transactions contemplated under this agreement.
6. Warranties
(1) The Seller represents and warrants to the Purchaser (for itself and as
trustee for any Nominated Purchaser) that:
(a) except for the Disclosed Matters each of the statements set
out in Schedules 5 and 6 are true and accurate at the date
hereof;
(b) except as fairly disclosed to the Purchaser in a supplemental
letter which the Seller may deliver to the Purchaser not later
than one Business Day before Completion (which, for the
avoidance of doubt, shall only contain disclosures relating to
the period from the day after the date of this agreement up to
and including the date of such letter and shall not have the
effect of remedying any errors or omissions contained in the
Disclosure Letter), each of the statements set out in
Schedules 5 and 6 will be true and accurate at the date one
Business Day before completion; and
(c) all information contained or referred to in the Disclosure
Letter is true and accurate in all material respects and
fairly presented and nothing has been omitted from the
Disclosure Letter which renders any of that information
incomplete or misleading.
(2) Each of the Warranties set out in the several paragraphs of Schedules 5
and 6 are separate and independent and except as expressly provided to
the contrary in this agreement is not limited:
(a) by reference to any other paragraph of Schedules 5 and 6; or
(b) by anything in this agreement or the Tax Deed.
(3) The Seller agrees with the Purchaser (as trustee for each Company and
its employees) to waive any rights or claims which he may have in
respect of any misrepresentation, inaccuracy or omission in or from any
information or advice supplied or given by any Company or its employees
in connection with the giving of the Warranties and the preparation of
the Disclosure Letter.
<PAGE>
12
(4) In the absence of fraud, dishonesty or wilful concealment on the part
of the Seller or its agents or advisers the liability of the Seller in
respect of the Warranties
shall terminate (but without prejudice to the rights and obligations of the
parties under the Tax Deed):
(i) on the seventh anniversary of Completion in respect
of those matters set out in Part D (Taxation) of
Schedule 5 and any other matters so far as they
relate to taxation; and
(ii) on the second anniversary of Completion in respect of
all other matters contained in Schedules 5 and 6,
except in respect of any claim of which notice in writing is
given to the Seller or the Seller's Solicitors before that
date provided that, unless the parties acting in good faith
otherwise agree, any claim which may be made shall (if it has
not previously been satisfied, settled or withdrawn) be deemed
to be withdrawn at the expiration of 12 months from the date
of giving notice of such claim unless legal proceedings in
respect thereof have been commenced by the issuing or service
proceedings against the Seller and the subject matter of any
such claim which shall be so deemed withdrawn shall not be
capable of being the subject of a further claim
but in relation to those Warranties set out in paragraphs A.4
and A.6 in Schedule 5 and the equivalent provisions in
schedule 6:
(i) the limitations set out in paragraphs (i) and (ii)
above shall not apply; and
(ii) nothing in the Disclosure Letter shall qualify or
limit their scope.
(5) The Purchaser shall not be entitled to make any claim under the
Warranties:
(a) to the extent that provision or allowance for the matter or
liability which would otherwise give rise to the claim in
question has been made in the 1999 ISD Accounts; or
(b) if the claim would not have arisen but for a change in
legislation made after the date of this agreement (whether
relating to taxation, rates of taxation or otherwise) or the
withdrawal of any extra-statutory concession previously made
by the Inland Revenue or other taxing authority (whether or
not the change purports to be effective retrospectively in
whole or in part).
(6) If the Purchaser becomes aware of a matter which gives rise to a claim
under the Warranties (other than a matter to which clause 15 applies)
the Purchaser shall give notice of the relevant facts to the Seller as
soon as reasonably practicable (and in the case of a claim relating to
a Schedule 6 Tax Warranty, such notice shall be given no later than
seven (7) days before the expiry of any statutory limitation period
relating to the making of an appeal but not earlier than 28 days after
the Purchaser became aware of such matter) and if the claim in question
arises as a result of a liability or alleged liability to a third party
the Seller may elect to dispute that liability or alleged liability and
to have the conduct of any defence of the dispute and of any appeal,
compromise and any incidental negotiations at its expense and on the
following basis:
(a) the Purchaser shall co-operate with the Seller and take such
action to avoid, dispute, resist, appeal, compromise or
contest the liability as may be reasonably requested by
<PAGE>
13
the Seller and which in the reasonable opinion of the Purchaser is not
likely to damage the Goodwill or the goodwill of any of the Companies;
(b) the Purchaser shall make available to the Seller such persons
in its employ and all such information in its possession as
the Seller may reasonably require for avoiding, disputing,
resisting, appealing, compromising or contesting any such
liability; and
(c) the Seller shall first indemnify and secure the Purchaser to
its reasonable satisfaction against all liabilities, costs and
expenses which it may suffer or incur in so acting.
If the Seller does not so elect by notice in writing to the Purchaser
within seven days of the Purchaser giving notice of the claim in
question, the Purchaser shall be at liberty to take such action to
avoid, dispute, resist, appeal, compromise or contest the liability as
it considers expedient.
(7) If the Seller makes any payment by way of damages for breach of the
Warranties (a "Damages Payment") and the Purchaser receives any benefit
under any policy of insurance or from any third party which would not
have been received but for the circumstance giving rise to the claim in
respect of which the Damages Payment was made, the Purchaser shall,
once it has received such benefit, forthwith repay to the Seller an
amount equal to the less of (i) the amount of such benefit, less all
costs of recovering that benefit and any incidental taxation and (ii)
the Damages Payment.
(8) Any payment made by the Seller in respect of a breach of the Warranties
or a liability under the Tax Deed shall be deemed to be a reduction in
the Consideration and shall reduce the relevant amount of the
Consideration as allocated to the Business or Shares in Schedule 2.
7. Limitation on the Seller's Liability
(1) The aggregate amount of the liability of the Seller under the
Warranties and the Tax Deed shall not exceed $150 million.
(2) No liability shall attach to the Seller under the Warranties unless the
aggregate amount of such liability disregarding any liability in
respect of Taxation or the Claim (as defined in Clause 23(10) shall
exceed $2,500,000 million in which event the liability of the Seller
(subject to the other provisions of this Clause 7) shall be limited to
the amount by which the liability exceeds such sum. No liability shall
attach to the Seller under the Warranties in respect of Taxation unless
the aggregate amount of such liability (when aggregated with any other
liability of it under the Tax Deed) exceeds $250,000 in which event the
liability of the Seller (subject to the other provisions of this clause
7) shall be limited to the amount by which the liability exceeds such
sum.
(3) No liability shall attach to the Seller under the Warranties
disregarding any liability in respect of Taxation in respect of any
single claim where an amount of such liability in respect of that
single claim is less than $75,000 and for this purpose breaches
comprising separate manifestations of the same or similar circumstances
shall be regarded as a single claim. No liability shall attach to the
Seller under the Warranties in respect of Taxation in respect of any
single claim where the amount of such liability in respect of that
single claim is less than $10,000 and for this purpose breaches
comprising separate manifestations of the same claim or similar
circumstances shall be regarded as a single claim.
(4) Payment of any claim under the Warranties or the Tax Deed shall pro
tanto satisfy and discharge any other claim under the Warranties or the
Tax Deed which is capable of being made in respect of the same subject
matter.
<PAGE>
14
(5) No liability shall attach to the Seller in respect of a claim under
Warranties to the extent that:
(a) such claim or the events giving rise to such claim arise or
such claim is increased as a result of an act, omission or
transaction by or at the request of or with the approval of
the Purchaser or a Company effected after Completion otherwise
than in the ordinary course of business as presently carried
out by that Company and which could reasonably have been
avoided and which the Purchaser was aware could give rise to a
breach of Warranties;
(b) such claim or the event giving rise to such claim would not
have arisen if the policies of insurance effected by the
company (or equivalent policies) had been maintained in force
after Completion;
(c) such claim results from or is increased or extended by the
change of the accounting reference date of the Company on
Completion or any subsequent change thereafter or by any
change in the accounting policies of the Company after
Completion;
(d) such claim results from any litigation relating to certain
copyright issues of authors and publishers of collective works
of a nature similar to the Tasini v New York Times, Ryan v
Carl Corporation and Robertson v Thomson litigation.
(6) In assessing the liability of the Seller under the Warranties or the
Tax Deed there shall be taken into account:
(a) any benefit (including taxation benefit) accruing to the
Purchaser or the Company as a consequence of the relevant
breach; and
(b) the amount of any provision or liability in respect of the
relevant breach within the 1999 ISD Accounts which has not
been fully utilised at the date of claim but to the extent so
taken into account shall not thereafter be available as a
provision.
(7) The Purchaser shall not be entitled to recover any sum in respect of
any claim for breach of any of the Warranties or otherwise obtain
reimbursement of restitution more than once in respect of any one
breach of the Warranties.
(8) In the event that the Purchaser or any Company is entitled to recover
from a third party (whether by payment, discount, credit, relief or
otherwise howsoever) any sum in relation to any loss, liability or
damage which is the subject of a claim under the Warranties or which
may give rise to a claim under the Warranties, the Purchaser shall (or
shall procure that the relevant Company shall) while pursuing any claim
under the Warranties:
(a) notify the Seller as soon as reasonably practicable and
provide such information and assistance as the Seller may
require relating to such entitlement and the action taken or
proposed to be taken by the Purchaser or the relevant Company
in respect of it;
(b) take (at the expense of the Seller) such reasonable steps or
proceedings as the Seller may require and shall act in
accordance with any such requirements of the Seller subject to
the Purchaser being indemnified by the Seller against all
reasonable costs and expenses incurred in connection therewith
and shall keep the Seller promptly informed of the progress of
any such steps, proceedings or actions.
<PAGE>
15
(9) Where a breach of the Warranties shall be in respect of a matter where
the Company shall be insured by an external third party insurer against
any loss or damage arising therefrom, the Purchaser shall, while
pursuing any claim against the Seller under the Warranties procure that
the Company shall make and diligently pursue a claim against its
external third party insurers for compensation for such loss or damage
suffered and any claim against the Seller shall be limited (in addition
to all other limitations on the Seller's liability elsewhere referred
to herein) to the amount by which the amount of the loss or damage
suffered by the Purchaser as a result of such breach shall exceed the
compensation paid (less the costs of recovery and any tax payable on
the compensation received) by the said insurers to the Company or the
Purchaser.
(10) In relation to any claim under the Warranties or any fact, matter,
event or circumstance which may give rise to a claim the Purchaser
shall allow (and shall procure that any relevant Company shall allow)
the Seller, its advisers and its agent to investigate any such claim,
matter, event or circumstance and whether and to what extent any amount
is payable in respect thereof and shall make available (and shall
procure that any relevant Company makes available) and shall use its
reasonable endeavours to procure that the auditors (both present and
then current) of the relevant Company make available to the Seller, its
advisers and its agents, all such property, information and assistance
(including access to properties and any of theirs books,
correspondence, audit papers or other documents or records and the
right to copy the same and making available employees and directors to
give assistance) as may reasonably be required by the Seller.
(11) If any claim under the Warranties shall arise by reason of some
liability of the Company which, at the time the claim is notified to
the Seller, which is contingent only, the Seller shall not be under any
obligation to make any payment to the Purchaser in respect of such
claim until such time as the contingent liability shall become an
actual liability and the twelve month period referred to in clause
6(4)(a) shall only begin on the date the contingent liability becomes
an actual liability.
(12) Nothing in this agreement shall be deemed to relieve the Purchaser from
any common law duty to mitigate any loss or damage incurred by it.
(13) The Purchaser warrants to the Seller that:
(a) it has not relied on any representation, warranty, covenant or
undertaking of the Seller or any other persons save for any
representation, warranty, covenant or undertaking expressly
set out in this agreement;
(b) the Purchaser is duly incorporated and validly existing under
the laws of Ontario;
(c) the Purchaser has power to enter into this agreement and to
perform the obligations expressed to be assumed by it and has
taken all necessary corporate action to authorise the
execution, delivery and performance of this Agreement;
(d) this agreement has been duly executed by the Purchaser;
(e) the execution, delivery and performance of the terms of this
agreement by the Purchaser will not violate any provision of:
(i) any law or regulation or any order or decree of any
authority, agency or court binding on the Purchaser;
<PAGE>
16
(ii) the Memorandum or Articles of Association of the
Purchaser.
(14) The Purchaser (for itself and as agent and trustee for and on behalf of
each Nominated Purchaser and their respective directors, officers,
employees, agents and advisers) agrees that no representation,
warranty, covenant or undertaking is or was given in or in relation to
any information, expression of opinion or future intention, forecast,
speculation, assessment, projection, illustration, estimate, budget or
advice contained in the Data Room or otherwise provided to the
Purchaser.
(15) Save as provided in Clauses 5 and 9, no breach of this agreement shall
in any event give rise to a right on the part of the Purchaser or
rescind or terminate this agreement and the sole remedy of the
Purchaser in respect of any breach of the Warranties shall be in
damages and shall be subject to the limitations contained in this
Agreement.
(16) In relation to any claim under any of the Warranties relating to Tax in
addition to the provisions in Clauses 6 and 7 of this Agreement the
provisions in Clauses 1 (Interpretation); 4 (Exclusions); 13
(Mitigation); 7 (Recovery from third parties); 9 (Conduct of Tax
Claims); of the tax deed shall mutatis mutandis apply (construing any
reference to a claim under the Tax Deed as if it were a reference to a
claim under the relevant Tax Warranty as if repeated and set out
herein). In relation to any claim in respect of Taxation under the
Warranties or the Tax Deed, in the event of a conflict between the
provisions of Clauses 6 and 7 of this Agreement (such as in the case of
the provisions Clauses 6(5), 6(6), 7(5), 7(8) and 7(9) of this
Agreement) and the provisions in the Tax Deed shall prevail.
8. Covenants up to Completion
(1) The Seller shall not in relation solely to the Business and shall
procure that no Company shall before Completion without the written
consent of the Chief Financial Officer or Chief Executive Officer of
the Purchaser or his designee:
(i) incur any single item of expenditure exceeding $150,000 or
(when aggregated with any amount incurred in relation to
subclause (iv)(cc) below) exceeding in aggregate $1,000,000
beginning on the date of this agreement on capital account; or
(ii) dispose of or grant any option or right of pre-emption in
respect of any part of its assets except in the ordinary
course of trading; or
(iii) borrow any money (except borrowings from its bankers not
exceeding $1 million) or make any payments out of or drawings
on its bank account(s) (except routine payments) or incur any
other borrowings in the normal course of business exceeding in
aggregate $500,000; or
(iv) enter into any unusual or abnormal contract or commitment or:
(aa) grant any lease or third party right in respect of
any of the Properties or transfer or otherwise
dispose of any of the Properties;
(bb) make any loan other than loans to the Business Sale
Employees or employees of the Companies in the normal
course of business;
(cc) enter into any leasing, hire purchase or other
agreement or arrangements for payment on deferred
terms in excess of (pound)150,000 per single item or
(when aggregated with any amount incurred in relation
to subclause (i) above)
<PAGE>
17
exceeding in aggregate $1,000,000 per month beginning
on the date of this agreement; or
(v) declare, make or pay any dividend or other distribution or do
or allow to be done anything which renders its financial
position less favourable than at the date of this agreement;
or
(vi) grant, issue or redeem any mortgage, charge, debenture or
other security or (other than in the normal course of
business) give any guarantee or indemnity; or
(vii) make any change in the terms and conditions of employment of
any of its directors or employees or employ or terminate
(except for good cause) the employment of any person other
than in respect of normal promotions or normal salary
increases in respect of the annual reviews; or
(viii) make, or announce to any person any proposal to make, any
change or addition to any retirement/death/disability benefit
(as defined in Schedules 5 and 6) of or in respect of any of
its directors or employees or former directors or former
employees (or any dependant of any such person) or to the
Scheme (as defined in that paragraph) (other than any change
required by law and proposed change which is mentioned in the
Disclosure Letter) or grant or create any additional
retirement/ death/disability benefit (as so defined) or,
without limiting the foregoing, take any action or allow any
action to be taken in relation to the Scheme other than in the
ordinary course of administering the Scheme or omit to take
any action necessary or prudent for the ordinary proper
operation of the Scheme; or
(ix) permit any of its insurances to lapse or do any thing which
would make any policy of insurance void or voidable; or
(x) create, issue, purchase or redeem any class of share or loan
capital; or
(xi) agree, conditionally or otherwise, to do any of the foregoing;
or
(xii) in any other way depart from the ordinary course of its
day-to-day trading.
(xiii) settle any claims by third parties for amounts in aggregate in
excess of $1,000,000.
(2) The Seller shall not, before Completion:
(a) dispose of any interest in the Shares or any of them or grant
any option or right of pre-emption over, or mortgage, charge
or otherwise encumber the Shares or any of them;
(b) permit any of the Companies to pass any resolution in general
meeting other than is required or is necessary in the ordinary
course of business or to effect the terms of this agreement;
(c) do or omit to do or cause or allow to be done or omitted to be
done any act or thing which would result (or be likely to
result) in a breach of any of the Warranties if the Warranties
were repeated at Completion.
(3) Until Completion the Seller shall procure that the Purchaser, its
agents and representatives are given full access to the Properties and
to the books and records of the Seller and the Companies and the Seller
shall provide such information regarding the businesses and affairs of
the Seller and the Companies as the Purchaser may reasonably require.
<PAGE>
18
(4) The Seller shall immediately notify the Purchaser in writing of any
matter or thing which arises or becomes known to him before Completion
which constitutes (or would after the lapse of time constitute) a
misrepresentation or a breach of any of the Warranties or the
undertakings or other provisions set out in this agreement.
9. Rescission
(1) If before Completion:
(a) any material breach of the Warranties either at the date
hereof or at the date one Business Day before Completion comes
to the notice of the Purchaser; or
(b) the Seller is in material breach of any obligation on its part
under this agreement or any related agreement and, where that
breach is capable of remedy, it is not remedied to the
Purchaser's satisfaction; or
(c) the Seller fairly discloses in a supplemental letter delivered
in accordance with clause 6(1)(b) any matter which, if not so
disclosed, would have constituted a material breach of the
Warranties at the date one Business Day before Completion; or
(d) any claim or claims of the type referred to in clause 7(5)(d)
comes to the notice of the Purchaser which either alone or in
aggregate are material,
then, but without prejudice to any other rights or remedies available
to the Purchaser, the Purchaser may without any liability to the Seller
elect not to complete the purchase of the Shares or the Business by
giving notice in writing to the Seller.
(2) If the Purchaser elects not to complete the purchase of the Shares and
the Business in the circumstances mentioned in paragraphs (a) or (b) of
subclause (1) above then (but without prejudice to any other rights or
remedies available to the Purchaser) the Seller shall indemnify the
Purchaser against all costs, charges and expenses incurred by it in
connection with the negotiation, preparation and rescission of this
agreement.
10. Tax Deed
The Seller shall on Completion enter into the Tax Deed in favour of the
Purchaser.
11. SUBSCRIPTION
(1) Subject to clause 5, the Purchaser shall subscribe, and the Seller
shall allot to the Purchaser 9,297,290 ordinary shares of 1p each in
the Seller for a total subscription price of (pound)15,851,879 (the
"New Shares").
(2) On Completion the Seller shall:
(a) allot the New Shares (conditionally only on the New Shares
being admitted to listing on the London Stock Exchange and
such admission becoming effective ("Admission")) to the
Purchaser pursuant to a resolution of its directors or of a
duly authorised committee of its directors; and
(b) deliver to the Purchaser a certified copy of the resolution
referred to at subclause (a) above.
<PAGE>
19
(3) Immediately following Admission, the Purchaser shall pay or procure the
payment of the subscription price for the New Shares, such payment to
be made to the Seller's account previously notified in writing to the
Purchaser in cleared funds for value that day.
(4) The Seller shall procure the registration of the Purchaser as the
holder of the New Shares promptly following the receipt by the Seller
of the payment to be made pursuant to subclause (3) (without
registration fee) and shall procure that a definitive certificate in
respect of the New Shares is despatched to the Purchaser as soon as
reasonably practicable following such payment.
(5) The Seller will make an application to the London Stock Exchange for
Admission and will use all reasonable endeavours to obtain Admission as
soon as reasonably practicable following Completion. The Seller will
supply all such information, give all such undertakings, execute all
such documents, pay all such fees and do or procure to be done all such
things as may be necessary or reasonably required by the London Stock
Exchange for the purpose of obtaining Admission.
12. Contracts AND CREDITORS
(1) Subject to subclauses (2) and (3) and from Completion the Purchaser
shall:
(a) be entitled to the benefit of the Contracts;
(b) carry out, perform and complete all the obligations and
liabilities to be discharged under the Contracts; and
(c) indemnify the Seller against all actions, proceedings, costs,
damages, claims and demands in respect of any failure on the
part of the Purchaser or the Nominated Purchaser to carry out,
perform and complete those obligations and liabilities.
(2) Nothing in this agreement:
(a) shall require the Nominated Purchaser to perform any
obligation falling due for performance or which should have
been performed before Completion; or
(b) shall make the Nominated Purchaser liable for any act,
neglect, default or omission in respect of any of the
Contracts prior to Completion or for any claim, expense, loss
or damage arising from any failure to obtain the consent or
agreement of any third party to the entry into of this
agreement or from any breach of any of the Contracts caused by
this agreement or its completion; or
(c) shall impose any obligation on the Nominated Purchaser for or
in respect of any product delivered by the Seller or any
service performed by the Seller prior to Completion.
(3) The Seller shall indemnify the Purchaser as trustee for the Nominated
Purchaser against all actions, proceedings, costs, damages, claims and
demands in respect of any act or omission on the part of the Seller in
relation to the Contracts on or before Completion.
(4) Insofar as the benefit or burden of any of the Contracts cannot
effectively be assigned to the Nominated Purchaser except by an
agreement or novation with or consent to the assignment from the
person, firm or company concerned:
(a) the Seller shall use all reasonable endeavours to procure the
novation or assignment;
<PAGE>
20
(b) until the Contract is novated or assigned the Seller shall
hold it in trust for the Nominated Purchaser absolutely and
the Purchaser shall or will procure that the Nominated
Purchaser shall (if such sub-contracting is permissible and
lawful under the Contract), as the Seller's sub-contractor,
perform all the obligations of the Seller under the Contract
to be discharged after Completion and the Purchaser shall
indemnify the Seller against all actions, proceedings, costs,
damages, claims and demands in respect of any failure on the
part of the Nominated Purchaser to perform those obligations;
and
(c) until the Contract is novated or assigned the Seller shall (so
far as it lawfully may) give all reasonable assistance to the
Nominated Purchaser to enable the Purchaser to enforce its
rights under the Contract.
(5) The Purchaser hereby undertakes to the Seller that it will pay and
discharge the Creditors when due and will indemnify the Seller against
any liabilities, charges, costs, claims, proceedings or demands
whatsoever which the Seller may suffer or incur in respect of the
Creditors.
13. Completion
(1) Completion shall take place at the offices of the Purchaser's
Solicitors on the third Business Day after satisfaction of the
conditions precedent referred to in Clause 5.
(2) At Completion the Seller and the Purchaser shall procure that the
respective events specified in Schedule 8 for which each party is
responsible shall take place.
(3) Upon completion of all the matters referred to in Schedule 7 the
Purchaser shall:
(a) pay to the Seller's Solicitors, in full discharge of the
Purchaser's obligation to pay the Consideration, the sum of
US$115,000,000 and shall procure that Dialog Corp repays the
US Debt;
minus the amount of overdue royalty payments owing at
Completion by the Seller's Group to the Purchaser's Group; and
plus or minus (as the case may be) the amount of the Excess or
Shortfall as determined in accordance with clause 4(3).
(4) The Seller agrees and acknowledges that repayment of the US Debt will
be in full and final settlement of all sums owed by the Dialog Corp to
the Seller.
(5) Time shall be of the essence in relation to the Seller's and the
Purchaser's obligations under this clause 13 and Schedule 8.
(6) If for any reason the events specified in Schedule 8 are not fully
complied with the party not in default may elect (in addition and
without prejudice to all other rights or remedies available to it) to
rescind this agreement or to fix a new date for Completion.
(7) The Seller and the Purchaser shall each provide the other upon request
with full and free access (including the right to take copies) during
usual business hours to the books, accounts and records of the Business
to be held by each of them after Completion and which relate to the
period up to Completion.
<PAGE>
21
14. Guarantees
(1) The Seller shall procure that on Completion each Company is released
from all guarantees and indemnities given by it to or for the benefit
of its bankers and bondholders and the Seller shall use all reasonable
endeavours to procure that as from Completion each Company is released
from all other guarantees and indemnities given by it in respect of
obligations of the Seller or any of its subsidiaries (other than the
Companies) and pending such release the Seller shall indemnify each
Company against all liabilities under those guarantees and indemnities.
(2) The Purchaser shall use reasonable endeavours to procure that as from
Completion the Seller is released from all guarantees and indemnities
given by him in respect of obligations of any Company and of which full
particulars are contained in the Disclosure Letter and pending its
release the Purchaser shall indemnify it against all liabilities under
those guarantees and indemnities.
15. Business sale employees
(1) In this clause:
"Covenantor" means, in relation to an indemnity, the person undertaking
to indemnify the beneficiary of such indemnity;
"Employment Date" means the date on which the employment of the
Business Sale Employees by the Purchaser, or the Nominated Purchaser,
takes legal effect (which, for the avoidance of doubt, shall be the
date of Completion or as soon as reasonably possible thereafter);
"liability" and "liabilities" includes any award, compensation,
damages, fine, loss, order, penalty, payment made by way of settlement
and costs and expenses reasonably incurred in connection with a claim
or investigation (including any investigation by any enforcement,
regulatory or supervisory body and of implementing any requirements
which may arise from any such investigation); or in respect of any
severance payment which falls due by virtue of any statutory obligation
or contractual entitlement or custom and practice and/or, any liability
in respect of the termination of employment of a Business Sale
Employee; legal costs and expenses are assessed on an indemnity basis.
"Offer of Employment" means an offer of employment by the Purchaser to
a Business Sale Employee on terms and conditions which are no less
favourable than those on which such Business Sale Employee was employed
by the relevant member of the Seller's Group immediately prior to
Completion;
(2) It is the intention of the parties that upon Completion the contracts
of employment of the Business Sale Employees will have effect after
Completion as if originally made between the Purchaser or the Nominated
Purchaser and the Business Sale Employees. Accordingly, it is agreed
that:
(a) where the local employment laws provide for the automatic
transfer of employees upon the transfer of a business as a
going concern, the employment of the Business Sale Employees
shall not be terminated upon Completion and the rights,
powers, duties, liabilities and obligations of each such
member of the Seller's Group or any relevant Company to or in
respect of the Business Sale Employees in respect of any
contract of employment with the Business Sale Employees in
force immediately before Completion shall so far as each
Business Sale Employee is concerned be
<PAGE>
22
transferred to the Purchaser or the Nominated Purchaser in
accordance with those local employment laws; and
(b) where the local employment laws do not provide for such
automatic transfer of employees, the Purchaser or the
Nominated Purchaser shall in each such case make Offers of
employment to the Business Sale Employees and the Seller will
procure that such Business Sale Employees are released from
employment with the relevant member of the Seller's Group as
soon as reasonably practicable.
(3) The Seller shall perform and discharge all its obligations in respect
of all the Business Sale Employees for its own account up to the
Employment Date (including, without limitation, any obligation to
discharge any bonus and incentive payment and any other remuneration
and other liabilities payable after Completion in respect of an
entitlement accrued to any extent for the period before the Employment
Date). The Seller shall indemnify the Purchaser (as trustee for the
Nominated Purchaser) against all liabilities arising from the Seller's
failure to perform and discharge all those obligations and against any
liabilities which:
(a) arise out of any act or omission by the Seller or any other
member of the Seller's Group or any other event, matter or
circumstance occurring or having its origin before the
Employment Date (including the fact of the parties proposing
to enter into, or having entered into, this agreement and/or
the identity of the Purchaser) or
(b) arise out of a claim made by or in respect of any person
employed or seconded or formerly employed or seconded by the
Seller or any member of the Seller's Group other than a
Business Sale Employee for which the Purchaser is liable by
virtue of the operation of this agreement from the Employment
Date; or
(c) arise out of a complaint of failure to comply with any
requirement to inform and consult with Business Sale Employee
and/or appropriate representatives of the Business Sale
Employees, or comply with any other requirements necessary to
give legal effect to the employment of the Business Sale
Employees by the Purchaser save where such failure or award
arises by reason of a failure by the Purchaser or any
Nominated Purchaser to comply with its obligations to provide
the Seller with such information as will enable the Seller to
perform its duty to comply with the requirements set out in
this sub-clause; or
(d) arise out of a claim for severance payment as a result of the
refusal of a Business Sale Employee to accept an Offer of
employment or by virtue of any termination of the Business
Sale Employee's employment prior to the Business Sale
Employee's acceptance of employment with the Purchaser or the
Nominated Purchaser.
(4) Without prejudice to subclause (3), the Purchaser shall procure that
the Nominated Purchaser shall assume responsibility as the employer of
the Business Sale Employees for its own account from the Employment
Date and the Purchaser shall indemnify the Seller against all
liabilities which the Seller may sustain or incur in relation to or by
reason of:
(a) any variation of the terms of employment of any Business Sale
Employee occurring after the Employment Date; or
(b) the dismissal of or the termination of the employment of any
Business Sale Employee occurring after the Employment Date;
(c) any objection by a Business Sale Employee to whom the
Employment Regulations apply to the transfer of his employment
in circumstances in which substantial
<PAGE>
23
and adverse change to his working conditions is proposed by
the Purchaser or a Nominated Purchaser.
(5) If any collective agreement has effect as if originally made between
the Purchaser or the Nominated Purchaser and the relevant trade union
or labour organisation or employee body, the Purchaser or the Nominated
Purchaser may, on becoming aware of that effect, terminate the
collective agreement and the Seller shall indemnify the Purchaser (as
trustee for the Nominated Purchaser) against any liabilities arising
out of such termination and against any liabilities incurred to or on
behalf of the relevant trade union.
(6) If any contract of employment relating to a person other than a
Business Sale Employee has effect as if originally made between the
Purchaser, or a Nominated Purchaser and that person, the Purchaser on
behalf of itself and as agent for that Nominated Purchaser shall notify
the Seller as soon as is reasonably practicable. The Seller or any
member of the Seller's Group shall then offer employment to that person
within 10 days of that notification and that person shall have 10 days
to accept or decline that offer of employment from the Seller. If after
that period has elapsed, the person concerned has not been offered such
employment or, if that person has been offered employment and has not
accepted that offer within the additional 10 day period, the Purchaser
on behalf of itself and as agent for the Nominated Purchaser may
terminate the contract. The Seller shall then indemnify the Purchaser
on behalf of itself and as agent for the Nominated Purchaser against
any liabilities arising out of such termination and against any sum
payable by it or in respect of that employee under his contract of
employment following Completion.
(7) If any contract of employment of a Business Sale Employee does not have
effect after Completion as if originally made between the Purchaser or
the relevant Nominated Purchaser and that Business Sale Employee, the
relevant member of the Seller's Group shall notify the Purchaser on
behalf of itself and as agent for that Nominated Purchaser as soon as
is reasonably practicable. The Purchaser shall then offer employment to
that person within 10 days of that notification and that person shall
have 10 days to accept or decline the offer of employment. The relevant
member of the Seller's Group shall use its reasonable endeavours to
encourage the acceptance of the offer of employment by the Business
Sale Employee. In the event that such person shall accept such offer of
employment the Seller will procure that such person is released from
employment with the relevant member of the Seller's Group as soon as
reasonably practicable and, in any event, within 10 days of
notification of acceptance of the offer of employment and the Seller
shall bear the costs in respect of any liability arising out of such
release. In the event that such person declines that offer of
employment, the Seller or the relevant member of the Seller's Group
shall continue to employ the Business Sale Employee and bear all
associated costs.
(8) If the Inland Revenue or equivalent local enforcement authority brings
into any charge to taxation any sum payable under any of the
indemnities contained in this clause, the amount so payable shall be
grossed up by such amount (such amount being referred to as the
"gross-up amount") as will ensure that after deduction of the tax so
chargeable there shall remain a sum equal to the amount that would
otherwise have been payable under such indemnity. To the extent that
the recipient of the payment subsequently obtains any tax credit,
allowance, repayment or relief as a result of the Covenantor paying to
it the gross-up amount, it shall pay to the Covenantor so much of the
economic benefit from that tax credit, allowance, repayment or relief
which it has received as does not exceed the gross-up amount (any
question as to the accrual or amount of any such economic benefit, the
order and manner of making any claim for any Tax credit, allowance,
repayment or relief, and the timing of any payment, being determined by
the recipient's auditors).
<PAGE>
24
(9) Interest at the rate of two per cent. per annum over the base rate from
time to time of The Royal Bank of Scotland plc shall be paid by the
Covenantor if it defaults in making any payment as required under this
clause. Interest shall be calculated from the due date until the date
of actual payment and compounded monthly.
(10) Any failure by any party to exercise any rights under this clause will
not operate as a waiver by that party of any such rights nor should it
prevent that party from exercising the same right. The liability of any
party under this clause shall not be released, impaired or affected by
anything done by or arrangements or alterations of terms made with any
of the parties to this agreement.
(11) The indemnities given by the Covenantor in this clause are in addition
to any rights which the recipient of the payment may have at law or
otherwise including, but not limited to, any right of contribution.
(12) The indemnities contained in this clause shall, for the avoidance of
doubt, extend to include all costs and expenses suffered or reasonably
incurred by the recipient of the payment in connection with enforcing
its rights under this clause.
(13) No statement in the Disclosure Letter shall affect any of the
indemnities in this clause.
17. Protective covenants
(1) The Seller covenants with the Purchaser (for itself and as trustee for
each Nominated Purchaser and each Company) that neither it nor any
member of the Seller's Group shall:
(a) for a period of 30 months from Completion be engaged in or
operate any business which directly or indirectly, aggregates,
stores, and distributes for general consumption information
similar to that offered by the Seller in relation to the
Business or the Companies prior to Completion. For the
avoidance of doubt, the Seller shall not be prohibited from
aggregating, storing and distributing such information to the
extent that such activities are customised for a specific
customer in connection with a sale of the Seller's technology
products through its Web Solutions Division or through the
other businesses retained by the Seller; or
(b) for a period of 2 years from Completion induce or attempt to
induce any supplier of the Seller or a Company to cease to
supply, or to restrict or vary the terms of supply, to the
Seller or that Company; or
(c) for a period of 2 years from Completion induce or attempt to
induce any director or senior employee employed in the
Business or a Company to leave the employment of the Purchaser
or that Company save for Ean Brown, Ciaran Morton, Kristin
Talvitie, Stuart Recher, Rolf Pielemeier, Joseph Hammer, Mark
Ostryn and Heather Disher (the employment of all of whom the
Seller shall procure to be transferred to the Seller's Group
prior to Completion and the Seller shall indemnify the
Purchaser and any member of the Purchaser's Group against any
liability to or in respect of such persons after Completion) ;
or
(d) employ or engage any of the Business Sale Employees or any of
the employees of the Companies at Completion prior to 1st
January 2001 save for Ean Brown, Ciaran Morton, Kristin
Talvitie, Stuart Recher, Rolf Pielemeier, Joseph Hammer, Mark
Ostryn and Heather Disher (the employment of all of whom the
Seller shall procure to be transferred to the Seller's Group
prior to Completion and the Seller shall indemnify
<PAGE>
25
the Purchaser and any member of the Purchaser's Group against
any liability to or in respect of such persons after
Completion); or
(e) make use of or (except as required by law or any competent
regulatory body) disclose or divulge to any third party any
information of a secret or confidential nature relating to the
Business or the business or affairs of any Company; or
(f) use or (insofar as he can reasonably do so) allow to be used
(except by the Purchaser's Group or the Companies) any trade
name used by the Business or a Company at Completion including
but without limitation the name "Dialog" or any other name
intended or likely to be confused with such a trade name other
than for the purposes of identification to third parties of
the Seller post Completion.
(2) Nothing in subclause (1) shall prevent the Seller from exercising the
rights granted to it pursuant to the Distribution Agreement.
(3) Each of the restrictions in each paragraph or subclause above shall be
enforceable by the Purchaser independently of each of the others and
its validity shall not be affected if any of the others is invalid.
(4) If any of those restrictions is void but would be valid if some part of
the restrictions were deleted the restriction in question shall apply
with such modification as may be necessary to make it valid.
(5) The Seller acknowledges that the above provisions of this clause are no
more extensive than is reasonable to protect the Purchaser as the
purchaser of the Shares.
18. Announcements
No party shall make or permit any person connected with him to make any
announcement concerning this sale and purchase or any ancillary matter
before, on or after Completion except as required by law or any
competent regulatory body or with the written approval of the other
parties, such approval not to be unreasonably withheld or delayed.
19. Value Added Tax
(1) All amounts stated to be payable under or pursuant to this agreement
are exclusive of VAT (if any). If any VAT is chargeable in respect of
any supply by one party (the "Supplier") to another party (the
"Recipient") under or pursuant to this agreement, the Recipient shall
pay to the Supplier the amount of that VAT in addition to any other
consideration within two working days after the issue by the Supplier
to the Recipient of a proper VAT invoice provided that nothing in this
subclause (1) shall be read so as to conflict with the provisions of
subclauses (2), (3) and (4) below.
(2) The Seller and the Purchaser intend that article 5 of the Value Added
Tax (Special Provisions) Order 1995 shall apply to the sale of the
Assets under this agreement and agree to use all reasonable endeavours
to secure that the sale is treated as neither a supply of goods nor a
supply of services under that article.
(3) If nevertheless any VAT is payable on the sale of all or any of the
Assets under this agreement and HM Customs & Excise ("Customs") have so
confirmed in writing then the Purchaser shall pay or shall procure the
payment to the Seller of the amount of that VAT in addition to the
price (and indemnify it for any fines, penalties or interest imposed by
Customs arising out of the treatment by the Seller and the Purchaser,
or the Nominated Purchaser (as
<PAGE>
26
the case may be) of the sale described in (2) above) forthwith five
working days before the Seller is required to account for that VAT to
Customs unless such date has passed in which case the Purchaser will
pay or procure the payment of that VAT to the Seller within two working
days after delivery by the Seller to the Purchaser or the Nominated
Purchaser (as the case may be) of a proper VAT invoice in respect of it
together with a copy of the ruling from Customs.
(4) Without limiting subclause (3) above, VAT shall be treated as payable
if Customs have so ruled in writing after full disclosure of all
material facts and with a view to obtaining such ruling the Seller
shall send a letter to its local VAT office as soon as possible after
the date hereof.
(5) Before sending any relevant letter to Customs, the Seller shall give
the Purchaser a reasonable opportunity to comment on it and shall make
such amendments as the Purchaser reasonably requires.
(6) The Purchaser warrants to the Seller that:
(a) the Purchaser or the Nominated Purchaser (as the case may be)
is registered for VAT or will be registered for VAT with
effect from a date not later than Completion and shall on or
before Completion provide to the Seller proof of such
registration reasonably satisfactory to the Seller;
(b) the Assets of the Business are to be used by the Purchaser or
the Nominated Purchaser (as the case may be) in carrying on
the same kind of business as that carried on by the Seller and
the Purchaser or the Nominated Purchaser (as the case may be)
will after Completion continue to carry on the Business.
(7) The Seller shall no later than five working days before Completion
deliver to the Purchaser or the Nominated Purchaser (as the case may
be) details of any of the Properties in respect of which the Seller has
made an election to waive exemption from VAT under the provisions of
paragraph 2 of Schedule 10 to the VATA 1994.
(8) The Purchaser warrants that it or the Nominated Purchaser (as the case
may be) will in respect of each of the Properties details of which are
delivered by the Seller pursuant to subclause (7):
(a) elect to waive exemption from VAT with effect from a date no
later than Completion; and
(b) deliver to Customs before Completion proper written
notifications of such elections;
(c) deliver to the Seller on Completion copies of the written
notification of such elections;
(d) deliver to the Seller copies of any acknowledgements from
Customs of such elections immediately following receipt by the
Purchaser.
(9) The Seller and the Purchaser intend that s.49(1) of the VATA 1994 shall
apply to the sale of the Assets under this agreement and accordingly:
(a) the Seller shall on Completion deliver to the Purchaser or the
Nominated Purchaser, as the case may be, all records referred
to in s. 49(1)(b);
<PAGE>
27
(b) the Seller shall not make any request to Customs for those
records to be preserved by the Seller rather than the
Purchaser or the Nominated Purchaser as the case may be;
(c) the Purchaser or the Nominated Purchaser (as the case may be)
shall preserve or shall procure to be preserved those records
for such period as may be required by law and during that
period permit the Seller reasonable access to them to inspect
or make copies of them; and
(d) the Purchaser or the Nominated Purchaser (as the case may be)
may fulfil its obligations under paragraph (c) by procuring
that a future transferee of the Business or any other person
preserves the records and permits reasonable access as
mentioned in that paragraph, in which case the Purchaser or
the Nominated Purchaser shall notify the Seller of the name of
that person.
(10) If the Purchaser pays the Seller or procures the payment to the Seller
of an amount in respect of VAT under subclause (3) above and Customs
confirm in writing to the Seller or Purchaser or Nominated Purchaser
that all or part of it was not properly chargeable, the Seller shall
repay the amount or relevant part of it to the Purchaser or the entity
from which it received payment. The Seller shall make the repayment
promptly after the ruling, unless it has already accounted to Customs
for the VAT. In that case, the Seller shall apply for a refund of the
VAT (plus any interest payable by Customs), use reasonable endeavours
to obtain it as speedily as practicable, and pay to the Purchaser or
the entity from which it received payment the amount of the refund and
any interest when and to the extent received from Customs.
20. Interest
Save as expressly provided in this agreement if any sum due for payment
under this agreement is not paid on the due date or is referred for the
determination of the Independent Accountant the party in default or the
party found liable to pay the amount determined by the Independent
Accountant, as the case may be, shall pay interest on that sum from the
due date until the date of actual payment or the date when the amount
would have been payable had it not been referred to the Independent
Accountant (as the case may be) calculated on a day-to-day basis of a
rate equal to the aggregate of 4 per cent. per annum and the base rate
of The Royal Bank of Scotland plc for the time being.
21. Notices
(1) Any notice or other document to be served under this agreement may be
delivered or sent by post or facsimile process to the party to be
served as follows:
(a) to the Seller at
The Communications Building
48 Leicester Square
London
WC2H 7DB
Fax: +44 171 839 3704
marked for the attention
of General Counsel
(b) to the Purchaser at
Metro Center
One Station Place
Stamford CT 06902
USA
<PAGE>
28
Fax: +1 203 357 9762
marked for the attention
of General Counsel
or at such other address or facsimile number as it may have notified to
the other parties in accordance with this clause. Any notice or other
document sent by post shall be sent by prepaid first class recorded
delivery post (if within the United Kingdom) or by prepaid airmail (if
elsewhere).
(2) Any notice or document shall be deemed to have been served:
(a) if delivered, at the time of delivery; or
(b) if posted, at 10.00 a.m. on the second business day after it
was put into the post; or
(c) if sent by facsimile process, at the expiration of 2 hours
after the time of despatch, if despatched before 3.00 p.m. on
any business day, and in any other case at 10.00 a.m. on the
business day following the date of despatch.
(3) In proving service of a notice or document it shall be sufficient to
prove that delivery was made or that the envelope containing the notice
or document was properly addressed and posted as a prepaid first class
recorded delivery letter or that the facsimile message was properly
addressed and despatched as the case may be.
22. Resolutions and waivers
(1) In relation to each Company the Seller shall procure the convening of
all meetings, the giving of all waivers and consents and the passing of
all resolutions as are necessary under the Companies Act 1985, its
articles of association (or other applicable laws or equivalent
documents) or any agreement or obligation affecting it to give effect
to this agreement.
(2) The Seller waives (and shall procure the waiver by its nominee(s) of)
all rights of pre-emption which it (or such nominee(s)) may have
(whether under the Company's articles of association or otherwise) in
respect of the transfer to the Purchaser or its nominee(s) of the
Shares or any of them.
(3) For so long after Completion as it remains the registered holder of any
of the Shares the Seller shall hold them and any distributions,
property and rights deriving from them in trust for the Purchaser and
shall deal with the Shares and any distributions, property and rights
deriving from them as the Purchaser directs; in particular, the Seller
shall exercise all voting rights as the Purchaser directs or shall
execute an instrument of proxy or other document which enables the
Purchaser or its representative to attend and vote at any meeting of
the Company.
23. General
(1) Each of the obligations, Warranties and undertakings set out in this
agreement which is not fully performed at Completion will continue in
force after Completion.
<PAGE>
29
(2) Unless otherwise expressly stated all payments to be made under this
agreement shall be made in sterling to the party to be paid as follows:
(a) to the Seller in immediately available funds to the account of
the Seller at:
bank: The Dialog Corporation plc
The Chase Manhattan Bank
125 London Wall
London
sort code: 609242
account number: 22624102
or such other account as the Seller may specify; and
(b) to the Purchaser in immediately available funds to the account
of the Purchaser at such account as the Purchaser may specify.
(3) The benefit of each of the obligations, Warranties and undertakings
undertaken or given by any of the Seller may be assigned in whole or in
part by the Purchaser to any subsidiary or holding company of the
Purchaser or any subsidiary of any such holding company ("Purchaser's
Group Company") but so that no assignee may enforce any such Warranties
or undertakings after it has ceased to be a Purchaser's Group Company.
(4) Subject to subclause (3) above none of the rights or obligations under
this agreement may be assigned or transferred without the prior written
consent of both parties.
(5) Time is not of the essence in relation to any obligation under this
agreement unless:
(a) time is expressly stated to be of the essence in relation to
that obligation; or
(b) one party fails to perform an obligation by the time specified
in this agreement and the other party serves a notice on the
defaulting party requiring it to perform the obligation by a
specified time and stating that time is of the essence in
relation to that obligation.
(6) Each party shall pay the costs and expenses incurred by it in
connection with the entering into and completion of this agreement.
(7) For a period of not less than 6 months after Completion the Purchaser
shall, if requested by the Seller, provide sufficient information and
links on the Dialog.Com website and associated websites for the
purposes of redirecting the Seller's shareholders to Seller's new
website.
(8) For 6 months following Completion, the Purchaser agrees to forward
email addressed to the Seller's employees (and other addresses
reasonably requested by the Seller) to addresses designated by the
Seller. During this period the Purchaser may also notify the sender of
any such email so forwarded of the intended recipient's new contact
information and that such email has been redirected.
(9) This agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same agreement and
any party may enter into this agreement by executing a counterpart.
(10) The Seller shall indemnify and keep indemnified the Purchaser, any
Nominated Purchaser and the Companies against all costs, claims,
liabilities, expenses, legal fees and expenses and
<PAGE>
30
damages (including third party costs) awarded by a court against any
Company or payable under any agreement reached in settlement of, Ryan
-v- Carl Corporation, Case No. C-97-3873-FMS (U.S.D.C.D. CAL) (the
"Claim") except to the extent specifically provided for or accrued in
the 1999 ISD Accounts. The Seller shall be entitled to have the conduct
of the Claim and of any negotiations regarding the Claim, but at its
expense and subject to the Purchaser, any Nominated Purchaser and the
Companies being indemnified in respect of any costs and expenses or
claims suffered by any of them as a result of the Claim. The Purchaser
shall, and shall procure that any Nominated Purchase shall, make
available to the Seller the services of Brian Holland and such other
persons and such information as the Seller may reasonably require for
conducting the Claim subject to the Purchaser, any Nominated Purchaser
and the Companies being indemnified in respect of any reasonable costs
and expenses or claims suffered by any of them as a result thereof
provided that no charge shall be made for time incurred by Brian
Holland or such other persons in providing such services.
(11) The Purchaser or the Nominated Purchaser will have the right to use
certain assets located in the Leicester Square properties as defined in
Part IV of Schedule 4 used in the Business which are shared with the
remaining business of the Seller for a period of 6 months from
Completion at a proportion of the Seller's costs of providing such
assets proportionate to the relative use of such assets by the Seller
and the Purchaser or the Nominated Purchaser.
24. Whole agreement
(1) This agreement and the documents referred to in it contain the whole
agreement between the parties relating to the transactions contemplated
by this agreement and supersede all previous agreements between the
parties relating to these transactions.
(2) Each of the parties acknowledges that in agreeing to enter into this
agreement it has not relied on any representation, warranty, collateral
contract or other assurance (except those set out in this agreement and
the documents referred to in it made by or on behalf of any other party
before the signature of this agreement. Each of the parties waives all
rights and remedies which, but for this subclause, might otherwise be
available to it in respect of any such representation, warranty,
collateral contract or other assurance, provided that nothing in this
subclause shall limit or exclude any liability for fraud.
25. DOMAIN NAMES
(1) Part 1 of Schedule 10 contains details of domain names which are owned
by the Companies or which will be transferred to the ownership of the
Purchaser prior to Completion. Part 2 of Schedule 10 contains details
of domain names owned by the Companies which will be transferred to the
Seller prior to Completion.
(2) If following Completion the Seller or the Purchaser is found to own a
domain name not listed in Schedule 10, ownership of that domain name
shall remain with the named owner unless the domain name clearly
relates to a business or product of another party in which case that
domain name shall be transferred to such other party and any costs
associated with such transfer shall be borne by the transferee.
26. Governing law
(1) This agreement is governed by and shall be construed in accordance
with English law.
(2) The Purchaser submits to the jurisdiction of the English courts for all
purposes relating to this agreement and irrevocably appoints The
Thomson Corporation plc as its agent for service of process.
<PAGE>
31
AS WITNESS the hands a duly authorised officer of the Seller and the Purchaser
on the date which appears first on page 1.
<PAGE>
32
SCHEDULE 1
Companies and Subsidiaries
Part A
Companies
1. The Dialog Corporation (Delaware)
Registered number: n/a
Registered office: 11000 Regency Parkway, Suite 10, Cary, NC
27511, USA
Date and place of 17 October 1989
Incorporation: Delaware
Directors: J Molle, D Wagner, R Swank
Secretary: B Holland, W Marks
Accounting reference date: 31 December
Auditors: PricewaterhouseCoopers
Authorised capital: n/a
Issued capital: 1,770 shares, no par value
Shareholders: No. of shares:
The Dialog Corporation plc 1,770
<PAGE>
33
2. Frost & Sullivan LLC
Registered number: n/a
Registered Agent: ICC Management Services Ltd
Sliveraide Carr Executive Center
Suite 100
Wilmington
DE 19809
USA
Date and place of Delaware, 7 July 1997
Incorporation:
Directors: n/a
Secretary: n/a
Accounting reference date: n/a
Auditors: n/a
Authorised capital: n/a
Issued capital:
Shareholders: No. of shares:
Virtual Intelligence Ltd (as nominee for The Dialog Corporation)
Westlex Registrars Ltd (as nominee for Frost & Sullivan)
<PAGE>
34
3. The Dialog Corporation Asia Pacific Limited
Registered number: 479012
Registered office: Room 1801, 18th Floor, Tai Van Building,
181 Johnston Road, Wanchai, Hong Kong
Date and place of
Incorporation: 19 May, 1994, Hong Kong
Directors: D. Mattey, C. Morton, Jonathan Ball
Secretary: S. Doig
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 10,000 ordinary shares of HKD1 each
Issued capital: 100 ordinary shares of HKD1 each
Shareholders: No. of shares:
The Dialog Corporation plc
(formerly M.A.I.D. plc) 99
D. Wagner 1
<PAGE>
35
Part B
Subsidiaries
1. Dialog Information Services Limited
Registered number: 1849601
Registered office: The Communications Building, 48 Leicester
Square, London WC2H 7DB
Date and place of
Incorporation: 20 September, 1994, England
Directors: D. Mattey, C. Morton
Secretary: J. Ball
Accounting reference date: 31 December
Auditors: PricewaterhouseCoopers
Authorised capital: 1,000 ordinary shares of GBP1 each
Issued capital: 100 ordinary shares of GBP1 each
Shareholders: No. of shares:
Dialog Holdings Ltd 100
<PAGE>
36
2. The Dialog Corporation GmbH (Germany)
Registered number: HRB 27051, local court Frankfurt am Main
Registered office: Ostbahnhofstrasse 13, 60314 Frankfurt
Frankfurt am Main, Germany
Date and place of
Incorporation: 5 November, 1996, Germany
Directors: B. Madlung, D. Mattey, C. Morton,
Secretary: n/a
Accounting reference date: 31 December
Auditors: audited by PricewaterhouseCooper as part of
Group Accounts
Authorised capital: DM50,000
Issued capital: DM50,000
Shareholders: No. of shares:
Dialog Corporation DM50,000
<PAGE>
37
3. The Dialog Corporation GmbH (Switzerland)
Registered number: CH-035.4.017.382-0
Registered office: 1 Laupenstrasse 18A, 3008 Bern, Switzerland
Date and place of
Incorporation: 28 January, 1998, Bern, Switzerland
Directors: T. Bauer, W. Kunzler, D. Mattey, C. Morton,
L. Nensch
Secretary: n/a
Accounting reference date: 31 December
Auditors: Accounts audited by PWC as part of Group
accounts
Authorised capital: n/a
Issued capital: 100,000 shares of SFR1 each
Shareholders: No. of shares:
Dialog Holdings Ltd 100,000
<PAGE>
38
4. The Dialog Corporation 98 sl
Registered number: 98083554
Registered office: Numancia 85 bajos, Barcelona, Spain
Date and place of
Incorporation: 26 June, 1997
Directors: F. Garcia-Sicilia Montero
Secretary: (M. Alba act as secretary)
Accounting reference date: 31 December
Auditors: Accounts audited by PWC as part of Group
accounts
Authorised capital: 10 shares of PTA50,000 each
Issued capital: 10 shares of PTA50,000 each
Shareholders: No. of shares:
The Dialog Corporation 9
Ivar Stenebring 1
<PAGE>
39
5. The Dialog Corporation srl
Registered number: 356467
Registered office: Viale Luigi Majno 40, 20219 Milano, Italy
Date and place of
Incorporation: 3 August, 1995, Italy
Directors: C. Morton, S. Quattrocchi
Secretary: none
Accounting reference date: 31 December
Auditors: Accounts audited by PWC as part of the
Group Accounts
Authorised capital: LIT20,000,000
Issued capital: LIT20,000,000
Shareholders: No. of shares:
The Dialog Corporation plc LIT5,000,000
Dialog Holdings Ltd LIT15,000,000
<PAGE>
40
6. The Dialog Corporation sarl
Registered number: B353667777
Registered office: 5 Rue Bellini, Tour Arago, 92800 Puteaux,
France
Date and place of
Incorporation: 23 February, 1990, France
Directors: F. Devemy
Secretary: n/a
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 500 shares of FRF100 each
Issued capital: 500 shares of FRF100 each
Shareholders: No. of shares:
Dialog Holdings Ltd 499
D. Wagner 1
<PAGE>
41
7. The Dialog Corporation A/S
Registered number: A/S 216188
Registered office: Marselis Boulevard 9, 8000 Arhus C, Denmark
Date and place of
Incorporation: 1 January, 1994
Directors: M. Nicholaisen, D. Mattey, C. Morton
Secretary: n/a
Accounting reference date: 31 December
Auditors: KPMG C. Jespersen
Authorised capital: DKR505,000
Issued capital: DKR505,000
Shareholders: No. of shares:
Dialog Holdings Ltd DKR505,000
<PAGE>
42
8. The Dialog Corporation (Sweden) AB
Registered number: AB 556-526-8470
Registered office:
Box 11036, 404 21 Goteborg
Date and place of
Incorporation: 25th October, 1995 Sweden
Directors: M. Nicholaissen A. Ashton, L. thejl Nielsen
Secretary: none
Accounting reference date: 31 December
Auditors: BDO Feinstein
Authorised capital: 100 shares of SEK1,000 each
Issued capital: 100 shares of SEK1,000 each
Shareholders: No. of shares:
The Dialog Corporation A/S 100
<PAGE>
43
Part C
1. The Dialog Corporation BV
Registered number: 33275725
Registered office: Strawinskylaan 331, 1077 XX, Amsterdam
Date and place of
Incorporation: 9 April, 1996, Amsterdam
Directors: David Gary Mattey, Castor Management &
Consultancy BV, Suzanne Lenaerts,
Daniel Maurice Wagner
Secretary: n/a
Accounting reference date: 31 December
Auditors: Accounts audited by PWC as part of Group
accounts
Authorised capital: 400 shares of NLG500 each
Issued capital: 80 shares of NLG500 each
Shareholders: No. of shares:
Dotcom Investments BV 80
<PAGE>
44
2. The Dialog Corporation (Ireland) Limited
Registered number: 235069
Registered office:
c/o B. Garvant Co., 6 Exchequer Street,
Dublin 2
Date and place of
Incorporation: 27 June, 1995, Eire
Directors: R. Ward, D. Mattey, I. Marshall, J. Ball,
D. Campbell-Lang
Secretary: D. Campbel Lang
Accounting reference date: 31 December
Auditors: PricewaterhouseCoopers
Authorised capital: 100,000 ordinary shares of IRL1 each
Issued capital: 2 ordinary shares of IRL1 each
Shareholders: No. of shares:
Dotcom Investments BV 2
<PAGE>
45
5. The Dialog Corporation SA
Registered number: 598.513
Registered office: Avenue Louise 120, Bruxelles 1050, Belgium
Date and place of
Incorporation: 22 December, 1995, Belgium
Directors: C. Morton, S. Lenaerts
Secretary: n/a
Accounting reference date: 31 December
Auditors: J. Lippens, S. Rabaey & Co.
Authorised capital: 2,500 shares of Belgian Francs 1,000 each
Issued capital: 2,500 shares of Belgian Francs 1,000 each
Shareholders: No. of shares:
Dotcom Investments BV 2,500
<PAGE>
46
Part D
1. Profound Inc
Registered number: n/a
Registered office: 11000 Regency Parkway, Suite 10,
Cary NC 27511, USA
Date and place of 30 November 1994
Incorporation: Delaware
Directors: J Molle, D. Wagner
Secretary: M Martel
Accounting reference date: n/a
Auditors: n/a
Authorised capital: 1,000 shares, no par value
Issued capital: 100 shares, no par value
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
47
2. Responsive Database Services Inc
Registered number: n/a
Registered office: 23611 Chagrin Blvd, Suite 320, Beachwood,
Ohio, USA
Date and place of 25 March 1994
Incorporation: Ohio
Directors: R Harris, Y Kolibash, C Fowler,
R Pierce-Saunderson
Secretary: R Harris
Accounting reference date: 31 December
Auditors: Hill, Stonestreet & Co.
Authorised capital: 100 shares common stock ($0.01 par value)
Issued capital: 100 shares common stock ($0.01 par value)
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
48
3. Responsive Database Services Limited
Registered number: 3092053
Registered office: Suite 3, Regency House, 85-87 George Street,
Luton LU1 2AT, England
Date and place of
Incorporation: 16 August, 1995, England
Directors: R. Harris, R. Pierce-Saunderson
Secretary: R. Pierce-Saunderson
Accounting reference date: 31 December
Auditors: Lim & Gordon
Authorised capital: 10,000 ordinary shares of GBP1 each
Issued capital: 10,000 ordinary shares of GBP1 each
Shareholders: No. of shares:
Responsive Database Services Inc. 10,000
<PAGE>
49
4. Virtual Business (Information) Inc
Registered number: n/a
Registered office: 11000 Regency Parkway, Suite 10, Cary,
NC 27511 USA
Date and place of 11 June 1996
Incorporation: Delaware
Directors: D Mattey, J Molle, D Wagner
Secretary: M Martell
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 1,000 shares common stock, no par value
Issued capital: 100 shares common stock, no par value
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
50
5. Virtual Intelligence Inc
Registered number: n/a
Registered office: 11000 Regency Parkway, Suite 10, Cary,
NC 27511.USA
Date and place of 11 June 1996
Incorporation: Delaware
Directors: D Mattey, J Molle, D Wagner
Secretary: M Martell
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 1,000 shares common stock, no par value
Issued capital: 100 shares common stock, no par value
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
51
6. Virtual Publishing Inc
Registered number: n/a
Registered office: 11000 Regency Parkway, Suite 10, Cary,
NC 27511.USA
Date and place of 21 May 1996
Incorporation: Delaware
Directors: D Mattey, J Molle, D Wagner
Secretary: M Martell
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 1,000 shares common stock, no par value
Issued capital: 100 shares common stock, no par value
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
52
7. Informart/DIALOG Limited
Registered number: n/a
Registered office: 333 King Street East, Toronto, Ontario
M5A 4R7, Canada
Date and place of 1 January 1994
Incorporation: Canada
Directors: A Prozes, L H Morgan, JH Thomas
Secretary:
Accounting reference date: 31 December
Auditors: -
Authorised capital: 500 Class A stock, 500 Class B stock
Issued capital: 500 Class A stock, 500 Class B stock
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 251 Class A
Southam Inc. 249 Class B
249 Class A
251 Class B
<PAGE>
53
8. Knight Ridder Information Asia Limited
Registered number: 555560
Registered office: Room 1801, 18th Floor, Tai Yau Building,
181 Johnston Road, Wanchai, Hong Kong
Date and place of 2nd July, 1994
Incorporation: Hong Kong
Directors: N Egan, D Mattey, S Doig
Secretary: Smart Secretaries Limited
Accounting reference date: n/a
Auditors: Yuen & Tam
Authorised capital: 10,000 Ordinary Shares of HK$1 each
Issued capital: 10,000 Ordinary Shares of HK$1 each
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 9,999
Dialog Information Europe Inc. 1
<PAGE>
54
9. Dialog Servicios de Informacion SA de CV [we have no information]
Registered number:
Registered office:
Date and place of
Incorporation:
Directors:
Secretary:
Accounting reference date:
Auditors:
Authorised capital:
Issued capital:
Shareholders: No. of shares:
<PAGE>
55
10. The Dialog Corporation SA de CV [we have no information]
Registered number:
Registered office:
Date and place of
Incorporation:
Directors:
Secretary:
Accounting reference date:
Auditors:
Authorised capital:
Issued capital:
Shareholders: No. of shares:
<PAGE>
56
11. Dialog Information Europe Inc
Registered number: n/a
Registered office: 3460 Hillview Avenue, Palo Alto, CA 94304
Date and place of
Incorporation: 23 December, 1991, California
Directors: D. Wagner, D. Mattey, J. Molle
Secretary: M. Martell
Accounting reference date: 31 December
Auditors: n/a
Authorised capital: 1,000,000 shares common stock, 5c par value
Issued capital: 100 shares common stock, no par value
Shareholders: No. of shares:
The Dialog Corporation (Delaware) 100
<PAGE>
57
SCHEDULE 2
ALLOCATION OF CONSIDERATION FOR THE SHARES AND ASSETS
<TABLE>
<CAPTION>
Business apportioned as follows: US$
<S> <C> <C>
(1) Goodwill; the balance of the total below
(2) Properties; book value
(3) Equipment; book value
(4) Stocks; book value
(5) Debts (less Creditors); book value
(6) Contracts; book value
(7) Business Intellectual Property. book value
Total US$23,000,000
Shares apportioned as follows:
(1) Dialog Information Services Limited US$170
(2) The Dialog Corporation GmbH (Germany) US$29,044
(3) The Dialog Corporation GmbH (Switzerland) US$10,000,000
(4) The Dialog Corporation 98 sl (Spain US$3,441
(5) The Dialog Corporation srl (Italy) US$11,871
(6) Dialog Information Services sarl (France) US$8,673
(7) The Dialog Corporation A/S (Denmark) US$114,944
(8) The Dialog Corporation (Delaware) US$80,000,000
(9) Frost & Sullivan LLC US500,000
(10) The Dialog Corporation Asia Pacific Limited (Hong Kong) US$1,251,493
(11) The Dialog Corporation BV US$5,000
(12) The Dialog Corporation (Ireland) Limited US$5,000
(13) The Dialog Corporation SA (Belgium) US$70,364
Total US$115,000,000
</TABLE>
<PAGE>
58
SCHEDULE 3
COMPLETION WORKING CAPITAL STATEMENT
A. PREPARATION OF THE COMPLETION WORKING CAPITAL STATEMENT
(1) As soon as reasonably practicable and by no later than 30 days
following Completion, the Purchaser shall prepare and deliver to the
Seller a consolidated Working Capital Statement of the Business and the
Companies as at Completion (the "draft Completion Working Capital
Statement"). The draft Completion Working Capital Statement shall be
prepared in the form shown in Part B of this Schedule and prepared in
accordance with clause 4 of this agreement and include the items shown
at part B of this Schedule and in accordance with the following:
(a) the accounting policies, principles, practices, evaluation
rules and procedures, methods and bases adopted by the Seller
and the Companies in the preparation of the Accounts; and
(b) to the extent not covered by (a), generally accepted
accounting principles and practices in the United Kingdom in
force at the Accounts Date.
(2) Within 14 days of delivery to the Seller of the draft Completion
Working Capital Statement, the Seller shall notify the Purchaser in
writing of any item or items they wish to dispute together with the
reasons for such dispute and a list of proposed adjustments. . If, by
the expiry of such 14 day period, no such notice is received by the
Purchaser or the Seller have notified the Purchaser that there are no
items they wish to dispute, the draft Completion Working Capital
Statement shall constitute the Completion Working Capital Statement for
the purposes of this agreement.
(3) If notice is received by the Purchaser that there are items in dispute
under paragraph (2), the Seller and the Purchaser shall attempt to
agree in writing the item or items disputed by the Seller and any other
item or items which, following receipt of notice of the items disputed
by the Seller, the Purchaser notifies the Seller that it wishes to
adjust. If such item or items are not agreed in writing between the
Seller and the Purchaser within 28 days of the delivery to the Seller
of the draft Completion Working Capital Statement, the item or items in
dispute shall be determined by:
(a) such firm of chartered accountants as the parties may agree in
writing; or
(b) failing agreement on the identity of the firm of chartered
accountants within a further 7 days from the expiry of the
period of 28 days referred to above, such firm of chartered
accountants as shall be appointed for this purpose on the
application of the Seller or the Purchaser by the President of
the Institute of Chartered Accountants in England and Wales.
(4) The draft Completion Working Capital Statement, adjusted to reflect the
item or items as agreed between the Seller and the Purchaser in writing
in accordance with this subclause or as determined by the accountants
(the "Accountants") appointed under this subclause, shall constitute
the Completion Working Capital Statement for the purposes of this
agreement.
(5) The Accountants shall act on the following basis:
(a) the Accountants shall act as experts and not as arbitrators;
<PAGE>
59
(b) the items or items in dispute shall be notified to the
Accountants in writing by the Seller and/or the Purchaser
within 14 days of the Accountants' appointment;
(c) their terms of reference shall be to determine the amount of
the item or items in dispute (taking into account the
provisions of this agreement relating to the form and content
of the Completion Working Capital Statement and calculation of
Working Capital) within 14 days of receipt of notice pursuant
to paragraph (b);
(d) the Accountants shall decide the procedure to be followed in
the determination;
(e) the Seller and the Purchaser shall each provide (and to the
extent they are reasonably able shall procure that their
respective accountants and the Purchaser shall procure that
members of the Purchaser's Group provide) the Accountants
promptly with all information which they reasonably require
and the Accountants shall be entitled (to the extent they
consider it appropriate) to base their opinion on such
information and on the accounting and other records of the
Seller and the Companies;
(f) the determination of the Accountants shall (in the absence of
manifest error) be final and binding on the parties; and
(g) the costs of the determination, including fees and expenses of
the Accountants shall be borne equally as between the Seller
on the one hand and the Purchaser on the other hand.
(6) The Seller shall and shall procure that the Seller's Accountants shall
provide the Purchaser and the Purchaser's Accountants with all
information, assistance and access to books and records of account,
documents, files and papers and information stored electronically which
they reasonably require for the purposes of this Schedule. The
Purchaser shall and shall procure that members of the Purchaser's Group
and that the Purchaser's Accountants shall provide the Seller and the
Seller's Accountants with all information, assistance and access to
stock, books and records of account, documents, files, papers and
information stored electronically which they may reasonably require for
the purposes of this Schedule.
<PAGE>
60
B. PROFORMA COMPLETION WORKING CAPITAL STATEMENT
<TABLE>
<CAPTION>
Working Capital Working Capital
At 31 December 1999 at Completion
(pound)000's (pound)000's (pound)000's
<S> <C> <C> <C>
Stock 60
60
Debtors
Trade 24,907 (a)
Other 457 (b)
Prepayments 4,494
CARL/Uncover Promissory note
excluded value in opening Balance
Sheet(pound)668 k 29,858
Cash -
Creditors within 1 year -
Trade (5,791) (c)
Inter co balances -
Taxation (1,308)
Accruals (23,023) (d)
Obligations under finance leases (2,032)
Other creditors (329)
Inter-company trading (51) excluded
(32,483)
Creditors outside 1 year
Accruals (primarily NYT) (354)
Obligations under finance leases (4,553)
(4,907)
Total December 31st 1999
Working Capital value before adjustments (7,472)
</TABLE>
Adjustments
(a) Less value of overdue royalties to Purchaser (Nil at 31 Dec 99)
(b) less deferred indexing costs and deferred CD Rom royalties
(c) less amounts due in respect of Tangible Fixed Assets
(d) less deferred CD Rom income
<PAGE>
61
<TABLE>
<CAPTION>
COMPLETION WORKING CAPITAL STATEMENT
Working Capital
at Completion
(pound)000's
<S> <C>
Stock x
Debtors
Trade x less (a)
Other x less (b)
Prepayments x
CARL/Uncover Promissory note x
Cash x
Creditors within 1 year
Trade x less (c)
Inter co balances
Taxation x
Accruals x less (d)
Obligations under finance leases x
Other creditors x less inter co trading
Creditors outside 1 year
Accruals (primarily) NYT x
Obligations under finance leases x
Net working capital x
--------
Add:
Payments made for fixed assets between 31 Dec and Completion x
Payments made in respect of opening provisions
excluding those paid in respect of CARL/Ryan x
Less:
Net working capital at 31 December 1999 (7,472)
Net of adjustments (a)-(d) as at that date x
------
Net Working Capital adjustment x
------
</TABLE>
Adjustments
(a) Less value of overdue royalties to Purchaser (Nil at 31 Dec 99)
(b) less deferred indexing costs and deferred CD Rom royalties
(c) less amounts due in respect of Tangible Fixed Assets
(d) less deferred CD Rom income
<PAGE>
62
SCHEDULE 4
PROPERTIES AND LEASES
<PAGE>
63
Part I - Properties
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
No. Description Company
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Third Floor The Dialog Corporation plc
Palace House
3 Cathedral Street
London SE1 9DE
2. Ground Floor The Dialog Corporation plc
2 Des Roches Square
Witney
Oxon OX8 6BE
3. 200 Bath Street The Dialog Corporation plc
Glasgow G2 4HG
4. South East Part of First Floor 48 Leicester The Dialog Corporation plc
Square, London, WC2
5. South West Part of First Floor 48 Leicester The Dialog Corporation plc
Square, London WC2
6. 2012 Citywest Business Campus The Dialog Corporation plc
Naas Road
Dublin
Ireland
-----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
64
Part II - Leases
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
No. Description Company
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Unit 4 Lloyds Transport Yard Dialog Information Services Limited
Hercules Way
Bowerhill
Melksham SN12 6TS
2. Avenue Louise 120 The Dialog Corporation SA
Bruxelles
1050 Brussels
Belgium
3. 5 Rue Bellini The Dialog Corporation SARL
Tour Arago
La Defense 11
92800 Puteaux
France
4. Ostbahnhof Strasse 13 The Dialog Corporation GmbH
60314 Frankfurt Main
Germany
5. Koeglweg 10 The Dialog Corporation GmbH
82024 Taufkirchen
Munich
Germany
6. Soenderhoej 46 The Dialog Corporation A/S
8620 Viby J
Denmark
7. Viale L Majno 40 Knight-Ridder Information srl
20129 Milano
Italy
8. World Trade Centre The Dialog Corporation B.V.
Block B, Floor 3
Strawinskylaan 331
1077 XX Amsterdam
The Netherlands
9. Three leases of Laupenstrasse The Dialog Corporation GmbH
18A
CH - 3008 Bern
Switzerland
10. Zollstrasse 58 The Dialog Corporation GmbH
8005 Zurich
Switzerland
11. Ostra Hamngatan 30-34 The Dialog Corporation Sweden AB
Box 11036
S - 404 21 Goteborg
Sweden
-----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
65
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
No. Description Company
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
12. Kungsgatan 29 The Dialog Corporation Sweden AB
Box 7589
10393 Stockholm
Sweden
13. C/Londres 17 2:DCHA The Dialog Corporation 98 sl
28028 Madrid
Spain
14. C/Numancia 85-87 Bajos 1 The Dialog Corporation 98 sl
08029 Barcelona
Spain
15. Haakon Vii's Gatan 5A The Dialog Corporation A/S
PB 1529
0117 Oslo
Norway
16. Part Level 3 Dialog Corporation Asia Pacific Limited
486 St Kilda Road
Melbourne
Victoria 3004
Australia
17. Level 5, 50 Margaret Street Dialog Corporation Asia Pacific Limited
Sydney
NSW 2000
Australia
18. Unit 20, 8th Floor Dialog Corporation Asia Pacific Limited
Shui on Plaza
333 Huai Hai Zhong Road
Shanghai 200021
China
19. 20/F Lyndhurst Tower The Dialog Corporation Asia Pacific Limited
No 1 Lyndhurst Terrace
Central
Hong Kong
20. 46B Circular Road The Dialog Corporation Asia Pacific Limited
Singapore 049401
21. RM 1007, No 237, Sec 2 The Dialog Corporation Asia Pacific Limited
Fu Hsing S Rd
Taipei 106
Taiwan
22. 11000 Regency Parkway The Dialog Corporation
Suite 10
Cary
NC 27511
-----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
66
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
No. Description Company
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
23. 2440 West El Camino Real, The Dialog Corporation
Suite 110
Mountain View
CA 94040
24. 1560 Wilson Blvd, Suite 500 The Dialog Corporation
Arlington
VA 22209
25. 3490 Piedmont Road #1104 Profound Inc.
Atlanta
GA 30305
26. 28 State Street The Dialog Corporation
Boston
MA 02109
27. 10475 Park Meadows Drive The Dialog Corporation
Littleton
CO 80124-5433
28. 75 East Wacker Drive, Dialog Corporation Inc. (now The Dialog Corporation)
Suite 800
Chicago
IL 60601
29. 1111 Superior Avenue, M.A.I.D. Inc. (now The Dialog Corporation)
Suite 1120
Cleveland
OH 44114
30. 16000 Dallas Parkway, The Dialog Corporation
Suite 325
Dallas
TX 75248
31. 5718 Westheimer, The Dialog Corporation
Suite 1315
Houston
TX 77057
32. 333 City Blvd West, The Dialog Corporation
Suite 870
Orange
CA 92868
33. 711 Third Avenue, 9th Floor The Dialog Corporation
New York
NY 10017
34. Two Meridian Crossing The Dialog Corporation
2nd Floor Suite 200
Richfield
MN 55423
-----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
67
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
No. Description Company
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
35. 2005 Market Street, The Dialog Corporation
Suite 1010
Philadelphia
PA 19103
36. 343 Sansome Street, The Dialog Corporation
Suite 825
San Francisco
CA 94104
37. 1611 116th Avenue NE, The Dialog Corporation
Office - 133
Bellevue
WA 98004
38. Office #105 The Dialog Corporation
324 Raritan Avenue
Highland Park
NJ
39. 655 Madison, 12th Floor The Dialog Corporation
New York
NY 10022
40. 3460 Hillview Avenue The Dialog Corporation
Palo Alto
CA 94304
41. 1611, 116th Avenue North East The Dialog Corporation
Bellevue
WA 98004
42. 96200 Carlenet The Dialog Corporation
Chapel Hill
N Carolina 27514
43. 5908 Baird Drive The Dialog Corporation
Raleigh
N Carolina
44. Flat 52, Building 1837 Bernard Callan
Road 4047, Block 340
Matrook Plaza
Juffair
Bahrain
-----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
68
Part III - Special Conditions
1. Consideration
Where the Property Purchase Price specified in respect of a Property is
nil, the consideration for the Property shall be the covenant on the
part of the Purchaser to be contained in the Property Transfer for that
Property.
2. Conditions of Sale
(1) Title to the Properties has been deduced to the Purchaser by the Seller
before the date of this agreement.
(2) The Properties are sold subject to the conditions in this Part of this
Schedule and to such additional special conditions (if any) relating to
each individual Property as are set out in Part IV of this Schedule.
(3) The Properties are sold free from all incumbrances and with vacant
possession.
(4) The Seller sells and shall transfer each Property with full title
guarantee and shall transfer to the Seller the whole of each Property
and shall not be obliged to transfer the Property to any other person
save that the Purchaser may require the Seller to transfer the Property
to a Nominated Purchaser.
(5) The beneficial ownership of and risk in each Property shall pass to the
Purchaser on Completion.
3. The Property Transfer
To the extent that the stamp duty or Land Registry fees payable in
respect of any Property Transfer are increased by reason of the Seller
proceeding by way of sub-sale, the Seller shall pay to the Purchaser on
demand and shall indemnify the Purchaser against the amount of the
increase.
4. Apportionments
(1) Before Completion the Seller shall pay all outgoings payable in respect
of the Properties, including all sums payable under the leases of any
of the Properties, which are due for payment on or before Completion
and the Purchaser shall repay to the Seller on Completion any such
monies pre-paid by the Seller in respect of any period from (and
including) the date of Completion to the intent that such monies shall
be apportioned between the Seller and the Purchaser as at the date of
Completion.
(2) In the event that any monies become due in respect of rent review
relating to a period prior to the date of Completion and the same has
been settled with the consent of the Seller (such consent not to be
unreasonably withheld or delayed) the Seller shall pay to the Purchaser
such monies from the period of the relevant review date to (and
excluding) the date of Completion.
5. Licence to assign
(1) This paragraph applies to any Property in relation to which the consent
of the landlord or other third party must be obtained in order that it
may be effectually and lawfully transferred
<PAGE>
69
or assigned to the Purchaser. For the purpose of this paragraph, a
Property held under a Lease containing an absolute prohibition against
assignment shall be deemed to be a Property in relation to which such
consent is required.
(2) The Seller shall, in all cases at the joint cost of the Seller and the
Purchaser and in consultation with the Purchaser, use reasonable
endeavours to obtain the consent as soon as possible, including
applying to the court for a declaration that the landlord is
withholding or delaying consent unreasonably, (if the Seller and
Purchaser agree (each acting reasonably) that such an application
should be made), shall keep the Purchaser informed on a weekly basis of
the progress of the application for the consent and shall supply a copy
of the consent when obtained.
(3) The Purchaser shall support the Seller's application for the consent
and supply such information and references as may be lawfully required
by the landlord or other third party as a condition of giving the
consent and shall enter into such covenants and provisions as any
landlord or other third party may lawfully require and shall be obliged
to procure the giving of any guarantee by any third party or to deposit
any money with the landlord or any other person as security for
compliance with the tenant's obligations in the lease if the same is
properly required by the landlord or such third party pursuant to the
terms of any particular lease and if such guarantee is to be provided
then the indemnity covenant given by the assignee of the lease to the
assignor shall also be guaranteed by such guarantor.
(4) If the consent has not been obtained by Completion:
(a) the Property shall be treated as severed from the remainder of
the Properties (unless the Seller and the Purchaser otherwise
agree in writing); and
(b) the contractual date for completion in relation to the
Property shall be postponed to the tenth business/working day
after the earliest of:
(i) the consent having been obtained;
(ii) if a declaration has been made by a court of
competent jurisdiction that the consent is being
unreasonably withheld, the period for making an
appeal against that declaration expiring without an
appeal being made; or
(iii) the Purchaser giving notice that it wishes to
complete the purchase even though the consent has not
been obtained;
(c) from Completion and until Actual Completion of the Property
Transfer the Seller shall:
(i) hold the Property on trust for the Purchaser;
(ii) permit the Purchaser to occupy the Property free of
charge; and
(iii) pay on the due date or within any grace period all
rents, licence fees, service charges, building
insurance premiums and other outgoings properly
payable by the Seller;
(d) from Completion and until Actual Completion of the Property
Transfer the Purchaser shall:
<PAGE>
70
(i) pay or indemnify the Seller against rents, licence
fees, service charges, building insurance premiums
and other outgoings or liabilities properly payable
by the Seller in respect of the Property for any
period after Completion;
(ii) observe and perform the covenants on the part of the
tenant contained in the lease.
(5) Unless the Purchaser gives notice to the Seller that it wishes to
complete the purchase in any event, the Property shall be withdrawn
from the sale on the first anniversary of the date of this agreement if
at that date:
(a) the consent has not been granted on terms consistent with the
provisions in the leases relating to the Properties in
question; and
(b) a declaration of the appropriate court (whether at first
instance or on appeal) that the consent is being unreasonably
withheld has not been made.
(6) If sub-paragraph (5) applies:
(a) the Purchaser shall vacate the Property as soon as reasonably
practicable (but in any event within one month thereof);
(b) the Purchaser's obligations in respect of the Property under
sub-paragraph (4)(d) shall cease on the date on which the
Purchaser vacates the Property but not in respect of any
period prior to such vacation; and
(c) the Property shall be excluded from the sale and the
Consideration shall be reduced by the amount specifically
attributed to the Property in Part I of this Schedule.
6. Rent reviews and lease renewals
(1) This paragraph applies to any Property where the rent review or any
renewal of a lease under which it is held is outstanding at the date of
this agreement or which commences between the date of this agreement
and Completion or Actual Completion (as the case may be).
(2) The Seller shall conduct each rent review and each lease renewal in
accordance with the proper instructions of the Purchaser who shall
indemnify the Seller in respect of reasonable and proper fees, costs
and expenses (together with VAT thereon) incurred by the Seller in so
doing. No rent review shall be agreed by the Seller otherwise than on
the basis that the reviewed rent shall be payable at a fixed rate from
the review date without further increase or decrease during the period
for which the rent is being reviewed.
(3) The Seller shall keep the Purchaser informed on a weekly basis of the
progress of every rent review and every lease renewal, shall provide
the Purchaser with copies of all material written documentation and
correspondence and shall afford the Purchaser a reasonable opportunity
to make representations.
(4) The Seller shall not agree a rent on a rent review, or agree a new
lease (including an interim rent) without the prior written consent of
the Purchaser, which consent shall not be unreasonably withheld or
delayed.
<PAGE>
71
7. Breach of lease
(1) This clause applies where, in relation to a Property, any of the
following occurs on or after the date of this agreement but before
Completion or Actual Completion (as the case may be):
(a) a notice alleging a breach of the tenant's covenants in the
lease is served;
(b) proceedings are commenced in respect of the breach, or alleged
breach, of any of the tenant's covenants in the lease;
(c) the landlord forfeits, or purports to forfeit, the lease by
peaceable re-entry.
(2) The Seller shall (subject to being fully indemnified by the Purchaser
for all costs, claims, expenses, demands and/or proceedings (together
with VAT thereon) incurred by the Seller in so doing):
(a) forthwith send a copy of the notice or the proceedings to the
Purchaser or forthwith inform the Purchaser of the peaceable
re-entry;
(b) act in accordance with the Purchaser's reasonable and proper
instructions in relation to the notice, the proceedings or the
peaceable re-entry;
(c) use reasonable endeavours to contest the notice or the
proceedings and, in any event, to obtain relief from
forfeiture of the lease.
8. Prohibited disposals
During the period from the date of this agreement until Completion or
Actual Completion (as the case may be) the Seller shall not:
(a) sell, exchange, let or dispose in any other way of any
Property or agree to do so or grant any option or right of
pre-emption in respect of any Property; or
(b) vary, surrender or determine in any way any lease under which
any Property is held or agree to do so;
(c) grant or agree to grant any right over any Property in favour
of any third party or vary or surrender any right benefiting
any Property.
9. Standard Conditions of Sale
(1) Subject to sub-paragraph (2) the Standard Conditions of Sale (Third
Edition) are incorporated in this agreement so far as they apply to a
sale by private treaty and are not inconsistent with the other clauses
of or Schedules to this agreement or with the other paragraphs of this
Schedule.
(2) Conditions 3.4, 5, 6.8, 7.3, 7.5, 7.6, 8 and 9 of the Standard
Conditions of Sale (Third Edition) do not apply.
<PAGE>
72
Part IV - Additional Special Conditions
1. The Leicester Square Properties
In this part of the Schedule "Leicester Square Properties" means the
Properties listed at numbers 4 and 5 of Part I of Schedule 4.
(1) The Seller shall produce proposals in respect of the Works specified in
sub-paragraph (2) of this paragraph) for the approval of the Purchaser
(such approval not to be unreasonably withheld or delayed) and upon
such approval being obtained the Seller shall apply to the landlord of
the Leicester Square Properties for consent for such alterations (the
cost of such alterations and the landlord's consent to them (subject to
the provisions at sub -paragraph (5)) being borne jointly by the Seller
and the Purchaser) and when the leases of the Leicester Square
Properties are assigned by the Seller to the Purchaser the Purchaser
shall diligently continue with the application for such consent.
(2) The "Works" shall be such works and alterations to the Leicester Square
Properties and the Seller's adjoining premises at 48 Leicester Square
as the Seller and the Purchaser agree are reasonably necessary to be
carried out to enable the Seller and the Purchaser (or the Nominated
Purchaser) to continue their respective business efficiently and
effectively:
(3) The Seller and the Purchaser shall enter into such form of licence for
alterations ("the Licence") in respect of the Works as the landlord of
the Leicester Square Properties properly requires pursuant to the terms
of the leases of the Leicester Square Properties and in the event that
the said landlord is prepared to grant the Licence prior to the
assignment of the leases of the Leicester Square Properties then the
Seller shall be entitled to enter into such Licence and the Purchaser
shall fully and effectively indemnify the Seller in respect of any
liability incurred by the Seller as a result of its entering into the
Licence.
(4) Once the Licence has been granted, the Purchaser shall diligently and
duly carry out the Works (in relation to the Leicester Square
Properties) and the Seller shall duly and diligently carry out the
Works (in relation to its part of the premises) in each case in
accordance with the Licence and in a good and workmanlike manner and to
the reasonable satisfaction of the other keeping the other fully
advised in respect of the progress of the Works as the other reasonably
and properly requires and allowing the other to inspect the Works from
time to time upon reasonable and prior written notice (save in the case
of emergency).
(5) The costs of the Works shall be borne between the Seller and the
Purchaser in accordance with the benefit of such Works to the Seller's
adjoining premises at 48 Leicester Square and the business carried on
thereat and the Leicester Square Properties and the business carried on
thereat respectively so that if any item exclusively benefits the
Seller's adjoining premises or the business carried on thereat it shall
be paid for by the Seller and if its exclusively benefits the Leicester
Square Properties or the business carried on thereat it shall be paid
for by the Purchaser and if it benefits both it shall be paid for on a
proportionate basis to the degree of benefit. All such payments shall
be made within 10 working days of proper demand but not earlier than
five working days before such payment is due to be paid to any third
party.
2. Car park licence at Leicester Square
Upon completion of the assignment of the Leicester Square Properties
the Seller shall also assign to the Purchaser the benefit of the car
parking space number seven pursuant to the provisions of a car park
licence dated 7th June 1994 between Stancia West End BV(1) and M.A.I.D.
plc (2) and the Purchaser shall fully indemnify the Seller against one
quarter of all
<PAGE>
73
liabilities under such licence and shall enter into such deeds and
covenants as are properly required pursuant to the terms of the car
park licence.
3. Payment for electricity consumed at Palace House
If and at such time that the landlord of the Property referred to at
item 1 of Part I of this Schedule serves a demand for the cost of
electricity supplied by the landlord to the tenant of that Property
then the Seller will reimburse the Purchaser for the proportion of such
costs which relates to the supply made to the tenant up to the date of
Completion, subject to the Purchaser first giving the Seller a
reasonable opportunity to make reasonable and proper representations to
the landlord and the Purchaser shall make such representations on
behalf of the Seller if the Seller reasonably so requires.
Part V - Additional Special Conditions
1. Change of control provisions
If as a result of entering into this agreement the tenant under any
Material Lease or under the Hong Kong Lease will be in breach of the
terms and conditions of that Lease then the Seller at the cost of the
Purchaser will use all reasonable endeavours to assist the Purchaser to
enable the tenant to remain as the legal tenant of the relevant Lease.
<PAGE>
74
SCHEDULE 5
SHARE SALE WARRANTIES
A. General
B. Accounts and Financial
C. Commercial
D. Taxation
E. Properties
F. Employees of Companies
G. Additional
A. GENERAL
A.1 Accuracy of recitals and schedules
The particulars relating to the Companies set out in the recitals and
the schedules to this agreement are true and accurate.
A.2 Memorandum and articles of association, statutory books and returns
(1) The copy of the memorandum and articles of association (or the
equivalent documents) of each Company which has been given to the
Purchaser's Solicitors is accurate and complete in all respects and has
annexed or incorporated copies of all resolutions or agreements
required by the Companies Act 1985 or other applicable law to be so
annexed or incorporated.
(2) The register of members and other statutory books and registers of each
Company have been properly kept and no notice or allegation that any of
them is incorrect or should be rectified has been received.
(3) All returns and particulars, resolutions and other documents which a
Company is required by law to file with or deliver to the registrar of
companies or his equivalent have been correctly made up and duly filed
or delivered.
(4) Without limiting the foregoing, each US Company: (i) is duly organised
and validly existing under the laws of its jurisdiction of
organisation; (ii) has all necessary power and authority to own,
operate or lease the properties and assets owned, operated or leased by
such US Company and to carry on its business as it has been and is
currently conducted by such US Company; and (iii) is duly licensed or
qualified to do business and is in good standing in each jurisdiction
in which the properties owned or leased by it or the operation of its
business makes such licensing or qualification necessary or desirable
except for such failures which when taken together with all other such
failures, would not have a Material Adverse Effect.
A.3 Seller's other interests
No member of the Seller's Group has any interest, directly or
indirectly, in any business which is or is likely to be competitive
with the business of any Company.
A.4 Ownership of the Shares
(1) The Shares constitute the whole of the issued and allotted share
capital of the Company.
<PAGE>
75
(2) No person is entitled or has claimed to be entitled to require any
Company to issue any share or loan capital either now or at any future
date whether contingently or not.
(3) There is no option, right of pre-emption, right to acquire, mortgage,
charge, pledge, lien or other form of security or encumbrance on, over
or affecting any of the Shares or any shares in the capital of a
Subsidiary nor is there any commitment to give or create any of the
foregoing, and no person has claimed to be entitled to any of the
foregoing.
A.5 Subsidiaries, associations and branches
No Company:
(a) holds or beneficially owns or has agreed to acquire any
securities of any other corporation (whether incorporated in
the United Kingdom or elsewhere), other than shares of a
Subsidiary; or
(b) is or has agreed to become a member of any partnership or
other unincorporated association, joint venture or consortium
(other than recognised trade associations).
A.6 Ownership of assets
(1) At the Accounts Date all the assets included in the Accounts were owned
or leased by the relevant Company and particulars of all fixed assets
over $100,000 acquired or agreed to be acquired by any Company since
the Accounts Date are set out in the Disclosure Letter.
(2) Except for current assets offered for sale or sold in the ordinary
course of trading, no Company has since the Accounts Date disposed of
any of the assets included in the Accounts or any assets acquired or
agreed to be acquired since the Accounts Date.
(3) None of the property, assets, undertaking, goodwill or uncalled capital
of any Company is subject to any encumbrance (including, without
limitation, any debenture, mortgage, charge, lien, deposit by way of
security, bill of sale, lease, hire-purchase, credit-sale or other
agreement for payment on deferred terms, option or right of pre-emption
but excluding lease, hire-purchase, credit sale or other agreement for
payment on deferred terms entered into in the ordinary course of the
Companies' business) or any agreement or commitment to give or create
any of the foregoing.
(4) The assets of the Companies comprise all the assets necessary for the
continuation of their businesses as carried on at the date of this
agreement.
A.7 Vulnerable antecedent transactions
No asset owned, purportedly owned or otherwise held by any Company is
liable to be transferred or re-transferred to another person or which
gives or may give rise to a right of compensation or other payment in
favour of another person under the law of any relevant jurisdiction or
country, other than pursuant to the terms of any agreement or contract.
<PAGE>
76
A.8 Compliance with statutes
(1) So far as the Seller is aware, no Company, nor (so far as the Seller is
aware) any of its officers, agents or employees (during the course of
their duties), has done or omitted to do anything which is a
contravention of any law, statute, order, regulation or the like giving
rise to any fine, penalty or other liability or sanction on the part of
that Company, except for such violations the existence of which would
not have a Material Adverse Effect or would not materially and
adversely affect the ability of the Purchaser to own and operate the
assets of the Companies after Completion.
(2) No US Company is in violation of any law, rule, regulation, order,
judgement or decree of a US jurisdiction, US authority or US court
applicable to such US Company or by which any of its assets are bound,
except for such violations the existence of which would not have a
Material Adverse Effect.
A.9 Licences and consents
Each Company has all licences (including statutory licences) and
consents necessary to own and operate its assets and to carry on its
business as it does at present, except where the lack of such license
or consent, individually and in the aggregate, would not have a
Material Adverse Effect and the Seller is not aware of anything that
might result in the revocation, suspension or modification of any of
those licences or consents or that might prejudice their renewal other
than where such revocation, suspension or modification would not have a
Material Adverse Effect.
A.10 Insider contracts
(1) No Company is a party to any contract (except a Contract) in which the
Seller or any member of the Seller's Group is interested, directly or
indirectly, nor has there been any such contract or arrangement at any
time during the six years up to the date of this agreement.
(2) No Company is a party to, nor have its profits or financial position
during the three financial periods ended on the Accounts Date been
affected by, any contract or arrangement which is not of an entirely
arm's length nature.
(3) No member of the Seller's Group is a party to any outstanding agreement
or arrangement for the provision of finance, goods, services or other
facilities to or by any Company or in any way relating to any Company
or its affairs.
A.11 Litigation
(1) No Company is engaged in any litigation or arbitration proceedings and
there are no such proceedings pending or threatened by any Company
except for the collection of trade debts incurred in the ordinary
course of business.
(2) The Seller does not know of anything which is likely to give rise to
any litigation or arbitration proceedings by or against any Company.
(3) No Company has received notice that it is the subject of any
investigation, inquiry or enforcement proceedings or process by any
governmental, administrative or regulatory body nor is the Seller aware
of anything which is likely to give rise to any such investigation,
inquiry, proceedings or process.
<PAGE>
77
A.12 Environmental matters
(1) In this paragraph:
(a) "Environmental Law" means all statutes, common law, bylaws,
regulations, directives, codes of practice, circulars,
guidance notes and the like (whether in the United Kingdom or
elsewhere) concerning the protection of human health or the
environment or the conditions of the workplace or the
generation, transportation, storage, treatment or disposal of
a Dangerous Substance;
(b) "Environmental Licence" means any permit, licence,
authorisation, consent or other approval required under or in
relation to any Environmental Law;
(c) "Dangerous Substance" means any natural or artificial
substance (whether in the form of solid, liquid, gas or
vapour, alone or in combination with any other substance)
capable of causing harm to man or any other living organism,
or capable of damaging the environment or public health or
welfare, including but not limited to controlled, special,
hazardous, toxic or dangerous waste; and
(d) "Relevant Property" means any premises now or previously
owned, leased, occupied or controlled by any Company.
(2) Each Company has obtained all requisite Environmental Licences (all of
which are valid and subsisting) and has at all times complied with all
applicable Environmental Law and with the terms and conditions of all
Environmental Licences. None of the operations or processes undertaken
by the Companies falls to be authorised under Part I of the
Environmental Protection Act 1990.
(3) No Environmental Licence is personal to the Seller or any of the
Companies and no Environmental Licence may be revoked, modified or
suspended as a result of the acquisition by the Purchaser of the
Shares.
(4) No Company has received any notice or other communication from which it
appears that it is or may be in violation of any Environmental Law or
Environmental Licence or that any further Environmental Licence may be
required or that any Environmental Licence may be subject to
modification, suspension or revocation and there are no circumstances
likely to give rise to any such violation or modification, suspension
or revocation.
(5) No Company is engaged in any litigation or arbitration proceedings
concerning Environmental Law or Dangerous Substances and the Seller is
not aware of any facts or circumstances which are likely to give rise
to such litigation or arbitration proceedings by or against any
Company.
(6) So far as the Seller is aware no Company is responsible (wholly or in
part) for any clean up or other corrective action in relation to any
Relevant Property or is subject to any investigation or inquiry by any
regulatory authority at any Relevant Property.
(7) So far as the Seller is aware no Company has used, disposed of,
generated, stored, transported, dumped, released, deposited, buried or
emitted any Dangerous Substance at, on, from or under any Relevant
Property or at, on, from or under any other premises.
<PAGE>
78
(8) So far as the Seller is aware no other person has used, disposed of,
generated, stored, transported, dumped, released, deposited, buried or
emitted any Dangerous Substance at, on, from or under any Relevant
Property.
(9) No Company has disposed of any Dangerous Substance in the past in such
a way that its disposal would now constitute a breach of Environmental
Law.
(10) No Relevant Property is included on or referred to in any register of
contaminated land or any similar record or register nor are there any
facts or circumstances of which the Seller is aware which are likely to
lead to registration in the future.
(11) So far as the Seller is aware, there is no contamination of groundwater
underneath any Relevant Property and there have been no discharges or
spillages of any substance likely to lead to such contamination.
(12) So far as the Seller is aware no Relevant Property has ever been a
waste disposal site and neither the Seller, the Companies nor any third
party has ever stored waste on or transported waste onto any Relevant
Property.
(13) So far as the Seller is aware there are no storage tanks, above or
below ground, on any Relevant Property.
(14) (a) Except as disclosed in the Disclosure Letter and except as
would not, individually or in the aggregate, have a Material
Adverse Effect, (i) to the Seller's knowledge, each US Company
is in compliance with all applicable US Environmental Laws and
has obtained and is in compliance with all US Environmental
Permits, (ii) there are no written claims pursuant to any US
Environmental Law pending or, to the Seller's knowledge,
threatened, against any US Company, and (iii) the Seller has
provided the Purchaser with copies of any and all
environmental assessment or audit reports or other similar
studies or analyses generated within the last two years and in
Seller's possession, that relate to any US Company.
(b) For the purposes of this paragraph (1) the following terms
have the following meanings:
"US Environmental Law" means and US federal, state or local
statute, law, ordinate, regulation, rule or code, or any
order, consent decree or judgment of any US federal, state or
local court or authority, in each case in existence on the
date of this agreement, relating to pollution or protection of
the environment.
"US Environmental Liability" means any claim, demand, order,
suit, obligation, liability, cost (including, without
limitation, the cost of any investigation, testing, compliance
or remedial action), consequential damages, loss or expense
(including attorney's and consultant's fees and expenses)
arising out of, relating to or resulting from any US
Environmental Law or US environmental, health or safety matter
or condition, including natural resources, and related in any
way to the US Companies or to this agreement or its subject
matter, in each case whether arising or incurred before, on or
after the Completion.
"US Environmental Permit" means any permit, approval,
identification number, license or other authorisation required
under or issued pursuant to any US Environmental Law.
<PAGE>
79
(c) The Purchaser acknowledges that (i) the Warranties contained
in subparagraph (15)(a) above are the only Warranties being
made with respect to compliance with or liability under US
Environmental Laws or with respect to any environmental,
health or safety matter, including natural resources, related
in any way to the US Companies or to this agreement or its
subject matter, and (ii) no other representation contained in
this agreement shall apply to any such matters and no other
representation or Warranty, express or implied, is being made
with respect thereto.
A.13 Insolvency
(1) No receiver or administrative receiver has been appointed in respect of
any Company or in respect of the whole or any part of the assets or
undertaking of any Company.
(2) No administration order has been made and no petition has been
presented for such an order in respect of any Company.
(3) No meeting has been convened at which a resolution shall be proposed,
no resolution has been passed, no petition has been presented and no
order has been made for the winding up of any Company.
(4) No Company has stopped or suspended payment of its debts, become unable
to pay its debts or otherwise become insolvent in any relevant
jurisdiction.
(5) No unsatisfied judgment, order or award is outstanding against any
Company and no written demand under s.123(1)(a) of the Insolvency Act
has been made against any Company and not dispensed when due or
terminated and no distress or execution has been levied on, or other
process commenced against, any asset of any Company.
(6) No voluntary arrangement has been proposed or implemented under s.1 of
the Insolvency Act in respect of any Company nor any scheme of
arrangement proposed or implemented under s.425 of the Companies Act
1985, nor any scheme for the benefit of creditors generally proposed or
implemented, whether or not under the protection of the court and
whether or not involving a reorganisation or rescheduling of debt.
(7) No person has taken any action, appointed any person, commenced
proceedings or obtained any order of the type mentioned in
subparagraphs (1) to (6) above in any relevant jurisdiction.
A.14 Capacity and consequences of sale
(1) The Seller has the requisite power and authority to enter into and
perform this agreement and the Tax Deed.
(2) This agreement constitutes and the Tax Deed will, when executed,
constitute binding obligations on the Seller in accordance with their
respective terms.
(3) Compliance with the terms of this agreement does not and will not:
(a) conflict with or constitute a default under any provision of:
(i) any Material Contract to which the Seller or any
Company is a party; or
(ii) the Companies' or the Seller's memoranda or articles
of association (or equivalent documents); or
<PAGE>
80
(iii) any lien, lease, order, judgment, award, injunction,
decree, ordinance or regulation or any other
restriction of any kind or character by which the
Seller or any Company is bound; or
(b) relieve any other party to a Material Contract with the Seller
or any Company of its obligations or enable that party to vary
or terminate its rights or obligations under that contract; or
(c) result in the creation or imposition of any lien, charge or
encumbrance of any nature on the Assets or on any of the
property or assets of any Company.
<PAGE>
81
B. ACCOUNTS AND FINANCIAL
B.1 Accuracy of Accounts
The Accounts:
(a) have been prepared under the historic cost convention (as
modified for the revaluation of land and buildings) and in
accordance with generally accepted accounting principles and
practices, the Companies Act 1985 and other applicable
statutes and regulations;
(b) correctly state the assets of the Companies and give a true
and fair view of the state of affairs of the Companies as at
the Accounts Date and of the profit or loss of the Companies
for the period ended on the Accounts Date or (as the case may
be) in respect of the periods for which they were prepared;
(c) contain either provisions adequate to cover, or full
particulars in notes, of all taxation (including deferred
taxation) and other liabilities (whether quantified,
contingent or otherwise) of the Companies as at the Accounts
Date; and
(d) are not affected by any unusual or non-recurring items.
B.2 Book debts
(1) The debts included in the Accounts have realised or will realise, in
the ordinary course of collection, their nominal amounts less any
provisions for bad and doubtful debts included in the Accounts.
(2) The Seller has no reason to believe that any debt owing to a Company at
the date of this agreement (other than the debts included in the
Accounts) will not in the ordinary course of collection realise its
nominal amount.
B.3 Books and records
All accounts, books, ledgers, and other financial records of the
Companies:
(a) have been properly maintained and contain accurate records of
all matters required to be entered in them by the Companies
Act 1985 (or equivalent legislation in the relevant
jurisdiction); and
(b) give a true and fair view of the matters which ought to appear
in them.
B.4 Position since Accounts Date
Since the Accounts Date:
(a) each Company has conducted its business in a normal and proper
manner;
(b) no Company has entered into any unusual contract or commitment
or otherwise departed from its normal course of trading;
<PAGE>
82
(c) each Company has paid its creditors within the times agreed
with them and in particular, without limiting the foregoing,
no debt owed by any Company has been outstanding for more than
90 days from the date of invoice except where such outstanding
debt does not and will not have a Material Adverse Effect;
(d) the policies for the payment of creditors which have been
applied during the financial period ended on the Accounts Date
have been continued and, in particular, there has been no
unusual postponement of the payment of creditors or unusual
acceleration of the collection of debts in either case having
regard to the policies applied for such payment and collection
prevailing in the financial period ended on the Accounts Date;
and
(e) there has been no unusual augmentation or unusual diminution
in the level of the Companies' stocks.
B.5 Dividends and distributions
(1) No dividend or other distribution of profits or assets, including
without limitation any distribution within the meaning of Part VI and
s.418 of the Taxes Act 1988, has been or agreed to be declared, made or
paid by any Company since the Accounts Date.
(2) All dividends or other distributions of profits or assets declared,
made or paid since the date of incorporation of each Company have been
declared, made and paid in accordance with law and its articles of
association (or equivalent documents).
B.6 Government grants
No Company is subject to any arrangement for receipt or repayment of
any material grant, subsidy or financial assistance from any government
department or other body.
B.7 Loans
No Company has in the last 12 months lent any material amount of money
which has not been repaid to it or owns the benefit of any material
debt (whether present or future) other than debts accrued to it in the
ordinary course of its business.
B.8 Information
The information in the circular and Listing Particulars in the Agreed
Form regarding the Companies and the Business is true and accurate in
all respects in relation to the information contained in Part II and is
true and accurate in all material respects in relation to the remaining
information. The 1999 ISD Accounts properly and fairly reflect the
results of the Companies and the Business during 1999 and the financial
position of the Companies and the Business at the end of 1999.
<PAGE>
83
C. COMMERCIAL
C.1 Material contracts
(a) The Disclosure Letter lists each of the following Contracts of
the Seller (relating to the Business) (such contracts and
agreements, together with all contracts, agreements, to which
any Company is a party, being "Material Contracts"):
(i) each contract, agreement, invoice and other
arrangement with any supplier or for the furnishing
of services to the Seller (related to the Business)
or any Company or otherwise related to the Business
under the terms of which the Seller (or its successor
in interest under such Material Contract) or the
relevant Company (A) is likely to pay or otherwise
give consideration of more than $1,000,000 in the
aggregate during the calendar year ending December
31, 2000, (B) so far as the Seller is aware, is
likely to pay or otherwise give consideration of more
than $1,000,000 in the aggregate during the calendar
year ending 31 December 2001, (C) each top 50
information provider contract by revenue not falling
within (A) or (B) of the sub-paragraph (i) above;.
(ii) each contract, agreement, invoices, sales order and
other arrangement, for the sale of personal property
or for the furnishing of services by the Seller (or
its successor in interest under such Material
Contract) (relating to the Business) or any Company
which: (A) is likely to receive consideration of more
than $1,000,000 in the aggregate during the calendar
year ending December 31, 2000, or (B) so far as the
Seller is aware, is likely to receive consideration
of more than $1,000,000 in the aggregate during the
calendar year ending December 31, 2001;
(iii) all management contracts and contracts with
independent contractors or consultants (or similar
arrangements) to which the Seller or any Company is a
party and which (A) is likely to involve
consideration of more than $1,000,000 in the
aggregate during the calendar year ending December
31, 2000, or (B) so far as the Seller is aware, is
likely to involve consideration of more than
$1,000,000 in the aggregate during the calendar year
ending 31 December 2001.
(b) Each Material Contract:
(i) is valid and binding on the parties thereto and is in
full force and effect.
(ii) is in the ordinary course of its business; or
(iii) is not of an onerous nature or cannot be fulfilled or
performed by that Company without undue or unusual
expenditure of money and effort; or
(iv) does not involve payment by that Company by reference
to fluctuations in the Index of Retail Prices or any
other published index save for payment of interest or
penalties; or
(v) does not require payment of any sum by that Company
in any currency other than sterling or US dollars.
<PAGE>
84
(c) Each Company has observed and performed all the terms and
conditions on its part to be observed and performed under the
Material Contracts.
(d) No Company has received notice of termination or non-renewal
of a Material Contract.
C.2 Restrictive Agreements
No Company is a party to any agreement or arrangement which restricts
its freedom to carry on the whole or any part of its business in any
part of the world in such manner as it thinks fit.
C.3 Anti-competitive arrangements
(1) No Company has during the last 2 years entered into any agreement,
arrangement, concerted practice or course of conduct which:
(a) was subject to registration under the Restrictive Trade
Practices Acts 1976 and 1977 (as amended);
(b) contravenes the provisions of the Resale Prices Act 1976 (as
amended) or any secondary legislation adopted under the Fair
Trading Act 1973;
(c) would infringe any provision of the Competition Act 1998;
(d) infringes Article 81 or 82 (formerly Articles 85 and 86) of
the Treaty establishing the European Community or any other
anti-trust or similar legislation in any jurisdiction in which
that Company carries on business or has assets or sales; or
(e) is void or unenforceable (whether in whole or in part) or may
render that Company liable to proceedings under any such
legislation as is referred to in subparagraphs (a) to (d)
above.
(2) So far as the Seller is aware no Company has during the last 2 years
entered into any agreement or arrangement or been involved in any
business practice in respect of which an undertaking has been given by
or an order made against or in relation to it pursuant to any
anti-trust or similar legislation in any jurisdiction in which it
carries on business or has assets or sales, including (without
limitation):
(a) Article 81 or 82 (formerly Articles 85 and 86) of the Treaty
establishing the European Community;
(b) the Restrictive Trade Practices Acts 1976 and 1977 (as
amended);
(c) the Resale Prices Act 1976 (as amended);
(d) the Fair Trading Act 1973 or any secondary legislation adopted
under that Act; and
(e) the Competition Act 1980 (as amended).
(3) No Company is now or has during the last two years been, a party to any
agreement or arrangement or been involved in any business practice in
respect of which:
<PAGE>
85
(a) any request for information, statement of objections or
similar matter has been received from any court, tribunal,
governmental, national or supra-national authority; or
(b) an application for negative clearance or exemption has been
made to the Commission of the European Communities; or
(c) an application for early guidance has been made under the
Competition Act 1998 to the Office of Fair Trading.
C.4 Secret or confidential information or property
Except as would not have a Material Adverse Effect each of the
Companies has taken reasonable steps in accordance with normal industry
practice to maintain the confidentiality of its material trade secrets
and other confidential Intellectual Property Rights owned by the
Company. So far as the Seller is aware (i) there has been no
misappropriation of material trade secrets or other material
confidential Intellectual Property Rights owned by the Company (ii) no
employee, independent contractor or agent of any Company has
misappropriated any material trade secret of any other person in the
course of such performance as an employee, independent contractor or
agent of the relevant Company, or is in material default or breach of
any terms of any employment agreement, non-disclosure agreement,
assignment or invention agreement or similar agreement
C.5 Intellectual Property Rights
(1) So far as the Seller is aware no activities of any Company (or of any
licensee under any licence granted by a Company) infringe any
Intellectual Property Rights of any third party and no claim has been
made against any Company or any such licensee in respect of such
infringement.
(2) Full details of all registered Intellectual Property Rights (including
applications to register the same) are set out in the Disclosure
Letter.
(3) The Company identified in the Disclosure Letter as the owner of an
Intellectual Property Right is the sole legal and beneficial owner of
or applicant for such Intellectual Property Right and all the
Intellectual Property Rights referred to in subparagraph (2) above are
owned solely by one of the Companies free of all encumbrances.
(4) All the Intellectual Property Rights described in subparagraph (3)
above are valid and subsisting and nothing has been done or omitted to
be done by any Company, and the Seller is unaware of any act or
omission of any third party, which would jeopardise the validity or
subsistence of any of such Intellectual Property Rights or such
agreements.
(5) So far as the Seller is aware, the operation of the business of the
Companies as conducted at any time during the previous 12 months does
not infringe, dilute or misappropriate the Intellectual Property Rights
of any third party and a Company's ability to use such Intellectual
Property Rights will not be affected by the acquisition of the
Companies by the Purchaser. Furthermore no claim, suit, action,
arbitration, inquiry, proceedings or investigation has been asserted,
is pending or is threatened against any Company alleging that the
operation of the business of any Company infringes or misappropriates
the Intellectual Property Rights of any third party.
<PAGE>
86
(6) The Seller is not aware of any unauthorised use by any person of any
Intellectual Property Rights or confidential information of any
Company.
C.6 Insurance
(2) Details of all insurance policies are set out in the Disclosure Letter
and such policies remain in full force and effect.
C.7 Data and records
(1) All the records and systems (including but not limited to computer
systems) and all data and information of each Company are recorded,
stored, maintained or operated or otherwise held exclusively by one of
the Companies and are not wholly or partly dependent on any facilities
or means (including any electronic, mechanical or photographic process,
computerised or otherwise) which are not under the exclusive ownership
and control of one of the Companies.
(2) The Seller is registered under the Data Protection Legislation in the
UK.
(3) No Company has received a notice or allegation from either the data
protection registrar controller or a data subject alleging
non-compliance with the Data Protection Legislation or any of the data
protection principles, requiring a Company to change or delete any data
or prohibiting the transfer of data to a place outside the United
Kingdom.
(4) No individual has claimed compensation from any Company under the Data
Protection Legislation for loss or unauthorised disclosure of data
prior to Completion.
(5) No Company has sold to a third party any customer information or data.
(6) For the purposes of this warranty:
"Data Protection Legislation" means all statutes, enacting instruments,
common law, regulations, directives, codes of practice, circulars,
guidance notes, decisions, recommendations and the like (whether in the
United Kingdom, the European Union [or elsewhere]) concerning the
protection and/or processing of personal data.
C.8 Business names
A list of names under which any Company carries on business is set out
in the Disclosure Letter.
C.9 No powers of attorney
Save for attorneys representing the Company in intellectual property
renewals, registrations, objections or challenges matters no Company
has granted any power of attorney or similar authority which remains in
force.
C.10 Systems compliance
(1) The material Computer Systems are Date Compliant.
For the purposes of this warranty:
<PAGE>
87
"Date Compliant" means that neither the performance nor functionality
of the Computer Systems is affected by dates prior to, during and after
the year 2000, and in particular in respect of the Computer Systems:
(a) no value for a current date will cause any interruption in
operation;
(b) date-based functionality will behave consistently for dates
prior to, during and after year 2000;
(c) in all interfaces and data storage, the century in any date
will be specified and displayed either explicitly or by
unambiguous algorithms or inferencing rules; and
(d) Year 2000 will be recognised as a leap year, and otherwise
conform to the quad-centennial rule.
"Computer Systems" means the Hardware, the Software and the
Telecommunications Equipment;
"Company Software" means the software used by the Companies in relation
to their business, the rights in which vest legally and beneficially in
the Company;
"Hardware" means the computer hardware and peripherals used by the
Companies in the ordinary course of their business;
"Software" means the Company Software and the Licensed Software;
"Licensed Software" means the software used by a Company the right in
which are owned by a third party;
"Telecommunications Equipment" means the telecommunications equipment
used by a Company (including all equipment used as part of the
Companies' computer networks).
(2) Except as would not have a Material Adverse Effect each Company has
valid licences to use the Licensed Software required for the carrying
on of that Company's business. No Company has received notice that it
is in breach of any of the licences relating to the Licensed Software.
(3) All Intellectual Property Rights in the Company Software are owned
legally and beneficially by a Company and no other party, whether an
employee, subcontractor or agent, has any rights (legal, beneficial or
under licence and whether arising by contract, trust or operation of
law) to the Company Software; nor any right howsoever arising to
royalty payments or otherwise to interfere, limit or fetter the full
exploitation of the Company Software by the relevant Company.
(4) There are no outstanding claims by any third party that the use of any
element of the Computer Systems infringes any Intellectual Property
Rights, or violates any other legal rights of such third party, nor is
any Company aware of anything which has been done or omitted to have
been done which might give rise to such a claim.
(5) No Company is aware of any infringement by third parties of any rights
including Intellectual Property Rights in relation to any part of the
Computer Systems.
(6) During the twelve months prior to the date hereof, none of the
Hardware, Software or Telecommunications Equipment has failed whether
by reason of bugs, or equipment
<PAGE>
88
breakdown, or for any other reason ("Performance Failure") such as to
cause disruption or interruption or loss to the business of any Company
which in any such case is significant or repeated, and the Seller is
not aware of any circumstances existing at the date hereof which could
result in the occurrence of a Performance Failure.
(7) There are no payments due to third parties under material leases,
licences or services agreements relating to the Computer Systems which
are due and which have not been paid, nor is the Seller aware of any
fact or matter which could result in the lawful termination by any
third party lessor or licensor of any such leases or licences, or the
avoidance of any obligation or withholding of consent by such third
party.
(8) Each Company owns or has the right to use the Hardware and
Telecommunications Equipment used in the business as carried on at the
date of this Agreement.
(9) Save for items which are leased by the Company the Computer Systems are
free and clear of all liens, restrictions, charges, encumbrances, or
claims of any party, including but not limited to, employees, agents,
consultants, or customers (save for the rights of third party licensors
in respect of the Licensed Software).
(10) To the best of the Company's knowledge, there have been no instances at
any time prior to the date hereof of unauthorised entry into the
Computer Systems by any party (whether or not resulting in damage to
any element of the Computer Systems, or any data stored therein, and
whether or not carried out by any current or former employee or other
third party).
(11) The Computer Systems have been satisfactorily maintained.
(12) Each Company has adequate procedures to ensure internal and external
security of the material Computer Systems including procedures for
taking and storing, on-site and off-site, back-up copies of computer
programs and data.
(13) The Seller is not aware of any claim or dispute relating (without
limitation) to the ownership, functionality, performance, maintenance,
payment obligations or right to use any part of the Computer Systems.
(14) No Company has released the source code to any Company Software
pursuant to any escrow agreement or arrangement to which the Company is
a party.
(15) In the event that any person providing maintenance or support services
for any of the Company Software or Licensed Software material to the
business, ceases or is unable to do so each Company has all necessary
rights to obtain the source code and all related technical and other
information to procure the carrying out of such services by that
Company's own employees or by a third party and such rights will not be
affected by the transaction contemplated in this Agreement.
(16) No action is needed to enable any Company to continue using the
Computer Systems following the transaction which is the subject matter
of this Agreement in substantially the same manner and to substantially
the same extent as used at the date of this Agreement.
<PAGE>
89
C.11 Content Licence Agreement
(1) The Seller represents that its and the Companies' standard forms of
content license agreement contain a clause whereby the licensor agrees
to indemnify the licensee in the event of a third party claim
pertaining to the content under license, and that substantially all of
its executed license agreements contain a provision of that effect,
provided that Seller does not warrant that each and every such clause
will be enforceable by the Purchaser.
(2) Neither the Seller nor any of the Companies has received any written
claims or demands of the kind described in Paragraph A.8(1) of the
Disclosure Letter, nor have they received any written notification that
threatens to name Seller or the Company as a defendant in any
litigation based on Certain Copyright Issues that are the subject
matter of the litigations referenced in Paragraph A.8(1).
<PAGE>
90
D. TAXATION
In this section:
"UK Companies" means those Companies which are incorporated in the UK; and
"Non-UK Companies" means those Companies which are incorporated outside the UK;
and the terms "UK Company" and "Non-UK Company" shall be construed accordingly.
D.1 GENERAL
(1) Taxation returns
All notices, computations and returns which ought to have been given or
made have been properly and duly submitted by each Company to the
relevant taxation or excise authorities and all information, notices,
computations and returns submitted to such authorities are true and
accurate and are not the subject of any material dispute nor are likely
to become the subject of any material dispute with such authorities.
(2) Taxation liabilities
All Taxation for which a Company is liable or for which a Company is
liable to account has been duly paid (insofar as such Taxation ought to
have been paid).
(3) Concessions
The amount of Taxation chargeable on any of the Companies during any
accounting period ending on or within seven years ending on the date
hereof has not been reduced to any material extent by any concession,
agreement or other formal or informal arrangement with any Taxation
authority (not being a concession, agreement or arrangement available
to companies generally).
(4) Penalties and interest
No Company has within the past seven years paid or become liable to
pay, nor so far as the Seller is aware are there any circumstances by
reason of which a Company is likely to become liable to pay, any
penalty, fine, surcharge or interest.
(5) Investigations
No Company has within the past twelve months suffered any non-routine
investigation, audit or visit by any taxation or excise authority, and
neither the Seller is not aware of any such investigation, audit or
visit planned for the next twelve months.
D.2 DEDUCTIONS AND WITHHOLDINGS
Each Company has made all deductions or withholdings in respect, or on
account, of Taxation from amounts paid by such Company, whether on its
own behalf or as agent, which it is obliged or entitled to make and has
properly accounted for any Taxation so deducted or withheld to the
appropriate taxation authority (other than amounts which have not yet
become due to be paid).
<PAGE>
91
D.3 REVENUE PAYMENTS AND LOAN RELATIONSHIPS
(1) Other than items of a recurring nature which have not been tax
deductible in accounting periods ending prior to the Accounts Date, all
rents, annual payments and other sums of an income nature paid or
payable by any Company since the Accounts Date or which any Company is
under an obligation to pay in the future are wholly allowable as
deductions or charges in computing the income of the Company for
Taxation purposes.
(2) All interest, discounts and premiums payable by a UK Company in respect
of its loan relationships within the meaning of Chapter II of Part IV
of the Finance Act 1996 (or similar legislation relating to a non-UK
Company) are capable of being brought into account by such company as a
debit for the purposes of that Chapter as and to the extent that they
are from time to time recognised in such company's accounts (assuming
that the accounting policies and methods adopted for the purpose of the
accounts of such UK Companies continue to be so adopted).
D.4 TAX DEPRECIATION ALLOWANCES
On the assumption that disposals are made for a consideration equal to
the book value shown in or adopted for the purposes of the Accounts, no
charge to Taxation would arise on the disposal by a non-UK Company of
any of its assets solely as a result of any depreciation for tax
purposes claimed in relation to any such assets and, in relation to a
UK Company on the same assumption, no balancing charge under the
Capital Allowances Act 1990 (or other legislation relating to any
capital allowances) would be made on any UK Company on the disposal of
any pool of assets (that is to say all those assets expenditure
relating to which would be taken into account in computing whether a
balancing charge would arise on a disposal of any other of those
assets) or of any asset not in such a pool.
D.5 CAPITAL GAINS
(1) No Company has disposed of or acquired any assets since the Accounts
Date in circumstances such that the disposal price or acquisition cost
of the assets would be treated for taxation purposes as being different
from the consideration given or received.
(2) The book value shown in or adopted for the purpose of the Accounts as
the value of each of the assets of any UK Company on the disposal of
which a chargeable gain or allowable loss could arise does not exceed
the amount which on a disposal of such asset at the date of this
agreement would be deductible under s.38 TCGA 1992.
(3) No Company has acquired or transferred an asset from or to any other
company which was, at the time of the acquisition or disposal, a member
of the same group of companies as that Company (other than another
Company) for the purposes of any Taxation on chargeable gains within
the last six years.
D.6 GROUPS
(1) Details of all claims or elections for any reliefs, allowances or
credits, the making or claiming of which was taken into account in
computing the provision or reserve for Taxation in the Accounts and
which have not been made by the Companies concerned as at the date
hereof are set out in the Disclosure Letter.
<PAGE>
92
(2) Except as provided in the Accounts no Company is or will be under any
obligation to make or has any entitlement to receive in respect of any
period ending on or before Completion any payment under any Taxation
sharing arrangement in respect of profits, gains or losses of the
Company.
(3) No Company has in the last three years been a member of any group
filing a combined or consolidated Taxation return (other than a group
the common parent of which was a Company) or has any liability for
Taxation of any person (other than of any Company) by contract or
otherwise.
D.7 COMPLETION
No charge to Taxation will arise on a Company by virtue only of the
entering into and/or completion of this agreement.
D.8 RESIDENCE
No Company is treated for any Taxation purpose as resident in a country
other than the country of its incorporation and no Company has, nor has
it within the past seven years had, a branch, agency or permanent
establishment in a country other than the country of its incorporation.
D.9 CONTROLLED FOREIGN COMPANIES AND OFFSHORE FUNDS
No UK Company has or in the past seven years has had any interest in a
controlled foreign company as defined in Chapter IV Part XVII Taxes Act
1988 nor any material interest in an offshore fund as defined in s.759
Taxes Act 1988.
D.10 VALUE ADDED TAX
(1) So far as the Seller is aware, each Company has complied with any
obligation to register for the purposes of VAT, goods and services tax,
sales/use tax, business transfer tax, customs duties and similar
Taxation and has complied with all statutory provisions, rules,
regulations, orders and directions concerning such Taxation.
(2) No Company is or was partially exempt in its current or preceding VAT
year and there are no circumstances by reason of which any such company
might not be entitled to credit for all VAT or its equivalent in its
country of incorporation incurred by it on supplies received and
imports and acquisitions already made (or agreed or deemed to be
received or made) by it or having received such credit might be obliged
to repay any part of it.
D.11 CLOSE COMPANIES
No UK Company is or has at any time within the last seven years been a
close company as defined in s.414 Taxes Act 1988.
D.12 TAX AVOIDANCE
(1) No Company has been a party to or otherwise involved in any transaction
to which any of the following provisions could apply:
s.29 to s.34 TCGA 1992;
s.116 or s.118 Taxes Act 1988;
<PAGE>
93
s.399 Taxes Act 1988;
s.729 to s.746 or s.774 to s.787 in Part XVII Taxes Act 1988;
s.801A Taxes Act 1988;
Schedule 5AA Taxes Act 1988;
Schedule 23A Taxes Act 1988
(2) No Company has been a party to any transaction to which any of the
following provisions have been or could be applied other than
transactions in respect of which all Inland Revenue clearances have
been obtained after disclosure of all material facts:
s.139 TCGA 1992
s.135 or s.136 TCGA 1992;
s.140A or s.140C TCGA 1992
s.213 to s.218 Taxes Act 1988 and s.192 TCGA 1992;
s.219 Taxes Act 1988;
s.703 Taxes Act 1988;
s.776 Taxes Act 1988.
(3) Transactions between persons under common control
No transactions or arrangements involving any Company have taken place
or are in existence which are such that any of the provisions of s.770
to s.773 Taxes Act 1988 have been or could be applied to them.
(4) Depreciatory transactions
No Company has been a party to any transaction to which the provisions
of s.176 or s.177 TCGA 1992 have been or could be applied.
(5) Reconstruction of transactions
No Company has been involved in any transaction or series of
transactions which, or any part of which, may for any tax purposes be
disregarded or reconstructed by reason of any motive to avoid, reduce
or delay a possible liability to tax.
(6) Interest on debts between associated companies
No company has had any interest in any debt to which any of the
provisions of s.61 to s.66 Finance Act 1993 have applied.
(7) Pension scheme refunds
Since the Accounts Date no payment has been made to any Company to
which s.601 Taxes Act 1988 applies.
D.13 STAMP DUTY AND STAMP DUTY RESERVE TAX
(1) All documents in the enforcement of which any Company may be interested
have been duly stamped with stamp tax or any similar taxes or duties.
<PAGE>
94
(2) The Shares in The Dialog Corp, Frost & Sullivan Electronic Distribution
LLC, Frost & Sullivan and The Dialog Corporation Asia Pacific Limited
are not "chargeable securities" within the meaning of s.99 Finance Act
1986.
D.14 AGREEMENTS
The amount of Taxation chargeable on each Company during any Tax year
on or within 6 years prior to the date of this agreement has not to any
material extent depended on any concession, agreement, dispensation or
other formal arrangement with any taxation authority in circumstances
where either:
(a) the availability of any such arrangement will be prejudiced as
a result of the acquisition or change of control of the
Companies resulting from this agreement; or
(b) any Company has not acted in accordance with the terms of any
such arrangement.
D.15 TRANSFER PRICING
So far as the Seller is aware, no transactions or arrangements
involving any Company have taken place or are in existence which are
such that any provision relating to transfer pricing is likely to be
invoked by a taxation or excise authority.
D.16 DISTRIBUTIONS
Since 31st December 1999 no Company has paid any dividend or made any
distribution of assets or repayment of capital by reference to which it
will or may be liable to Taxation and no Taxation accounting period of
any Company has ended.
D.17 SECONDARY LIABILITY
No Company is nor so far as the Seller is or will become liable to
Taxation chargeable primarily on any other company.
D.18 DEEMED INCOME AND GAINS
Except as provided in the Accounts, no Company has a liability to
Taxation on income or gains except in respect of and to the extent of
income and profit actually received, nor do arrangements exist which
are likely to give rise to such a liability.
<PAGE>
95
E. PROPERTIES
E.1 General
"Material Lease" means the leasehold properties at Melksham, in the
United States and the three leasehold properties at Bern in
Switzerland.
(1) Part II of Schedule 4 contains details of all Leases held by the
Companies.
(2) No Company holds any real property lease other than the Leases.
(3) The description of each of the Material Leases in Part II of Schedule 4
is, in each case, true, accurate and complete and includes all the
information which is needed fully and exactly to identify the Leases
and the Land to which they relate.
E.2 Title
(1) Each Company is fully and solely entitled to the Material Leases listed
under its name in Part II of Schedule 4 and is in exclusive occupation
of the Land the subject of the Leases. Each Material Lease is valid and
subsisting.
(2) So far as the Seller is aware each Material Lease is free from
encumbrances or third party rights of any kind whatsoever which would
materially adversely affect it.
E.3 Group Leases
(1) Each Material Lease complies with all applicable laws and regulations
and whenever capable of registration it has been registered, is in full
force and effect and the relevant Company has complied with its
obligations under it.
(2) So far as the Seller is aware, no Company has made any material
renovation or alteration of any Land held under any Material Lease
other than on the basis of and in accordance with the prior consent of
the relevant landlord.
E.4 Roads and services
(1) So far as the Seller is aware the relevant Company has a permanent
legal right free from onerous and unusual conditions to use all roads
and conducting media serving the Land held under each Material Lease in
the manner in which they are presently used and neither the Seller nor
any Company knows of any imminent or likely interruption of the right
of such Company to use these roads or conducting media.
(2) So far as the Seller is aware no Company has entered into any agreement
or is under any obligation in respect of the construction, maintenance
or adoption of any road or footpath or any conduit.
E.5 Covenants
(1) So far as the Seller is aware, there is no covenant, restriction,
burden or stipulation affecting the Land which is the subject of any
Material Lease which is of an onerous or unusual nature or which
conflicts with its present use or materially affects its value.
<PAGE>
96
(2) No material breach of any covenant which is contained in any Material
Lease, is outstanding and the rent payable under each Lease has been
paid up to date.
(3) Neither the Seller nor any of the Companies has received notice of any
outstanding material breach of covenant in respect of any Material
Lease.
E.6 Disputes
So far as the Seller is aware there are no material disputes regarding
boundaries, rights covenants or other matters relating to any Material
Lease or the Land held under any Material Lease or the use of that
Land.
E.7 Notices, orders and proposals
Neither the Seller nor so far as the Seller is aware any of the
Companies has received any notice or order affecting any Land held
under any Material Lease from any Government department, any authority
or any third party and, so far as the Seller is aware, there are no
proposals on the part of any Government department or any authority
which would adversely affect any Land held under any Material Lease,
including, without limitation, those relating to compulsory purchase or
expropriation or highways works.
E.9 Repair
(1) All buildings or other erections on the Land held under each Material
Lease are in the Seller's opinion in good repair and in good condition
and are in such state of repair and condition as to be substantially
fit for the purpose for which they are at present used and so far as
the Seller is aware do not contain any substance or material which is
defective or a risk to health or safety.
(2) So far as the Seller is aware, no Company is under any obligation to
carry out improvements or repairs to the whole or any part of the Land
held under any Material Lease, nor has any Company received any order
or instruction with respect to any such improvements or repairs.
E.10 Schedules
The information relating to the Properties in Schedule 4 is true and
accurate.
E.11 Contingent lease liabilities
(1) No Company is a guarantor of the tenant's covenants in any lease.
(2) No Company has surrendered the lease of any leasehold property to the
reversioner without first investigating the reversioner's title and
without receiving from the reversioner an absolute release from the
tenant's covenants in the relevant lease and from all liability arising
under the lease.
(3) No Company has assigned or transferred any leasehold property of which
it was the original tenant or in respect of which it entered into a
covenant with the landlord to observe and perform the tenant's
covenants under that lease without receiving a full legal indemnity in
respect of its liability under that lease.
(4) No Company has conveyed or transferred any freehold property in respect
of which it entered into any covenant (including an indemnity covenant)
which continues to bind it without having received a full and effective
indemnity in respect of its liability under that covenant.
<PAGE>
97
F. EMPLOYEES OF COMPANIES
F.1 Particulars disclosed
The Disclosure Letter contains the following information:
(a) the names of all the employees of each Company;
(b) particulars of any person who has accepted an offer of
employment made by any Company but whose employment has not
yet started and of any outstanding offer of employment made to
any person by any Company;
(c) the salary of each employee of each Company.
(d) the terms and conditions of employment for persons holding the
office of vice president or higher or their equivalent;
(e) particulars of any agreement for the provision of consultancy
services or the services of personnel to any Company and of
the terms applicable to the secondment to any Company of any
person;
(f) a description of the constitution of any works council or body
of employee representatives and particulars of any trade union
relevant to the employees;
(g) particulars of any collective or workforce agreement,
dismissal procedures agreement and trade union membership
agreement; and
(h) particulars of any custom, practice or discretionary
arrangement of any Company in relation to the remuneration of
any of its employees (including remuneration of any sort by
reference to turnover, profits or performance) or the
termination of their employment (whether voluntary or
involuntary).
F.2 Employees and terms and conditions of employment
(1) No Company employs or has any obligation to employ or have seconded to
it any person other than the persons who have been disclosed pursuant
to paragraph F.1(a) and (b).
(2) No employee of any Company whose name is disclosed pursuant to
paragraph F.1(a) has given, or has been given, notice of termination of
his employment.
(3) Since 31st December, 1999, no material change has been made in the rate
of the emoluments of any employee of any Company.
(4) No proposal, assurance or commitment has been communicated to any
person and not effected regarding any material change to his terms of
employment or working conditions or regarding the continuance,
introduction, increase or improvement of any benefit, custom or any
discretionary arrangement or practice.
(5) All subsisting contracts of employment and any agreements as mentioned
in paragraph F.1(e) to which any Company is a party are terminable by
it on three months' notice or less without compensation.
<PAGE>
98
(6) No Company has any outstanding liability to pay compensation for loss
of office or employment or a redundancy payment to any present or
former employee or to make any payment for breach of any agreement
referred to in paragraph F.1(e) [and no such sums have been paid
(whether pursuant to a legal obligation or ex gratia) since 31st
December, 1999.
(7) There is no term of employment for any employee of any Company which
provides that a change of control of any Company shall entitle the
employee to treat the change of control as amounting to a breach of the
contract or entitling him to any payment or benefit whatsoever or
entitling him to treat himself as redundant or otherwise dismissed or
released from any obligation.
(8) Except in respect of reimbursement of out-of-pocket expenses and normal
accruals of emoluments after31st December, 1999, no sum is owing or
promised to any employee of any Company or under any agreement referred
to in paragraph F.1(e).
(9) No Company has any material loan or advance, or provided any material
financial assistance to any employee or past or prospective employee of
any Company, which is outstanding.
F.3 Disputes
(1) Each Company has in all material respects complied with its obligations
to applicants for employment, its employees and former employees, any
relevant trade union, works council and employee representatives.
(2) No claim in relation to the Companies' employees or former employees
has been made against any Company or against any person whom any
Company is liable to indemnify.
(3) There is not, and during the two years preceding the date of this
agreement there has not been, any collective labour dispute or
industrial action affecting any Company.
(4) No employee of any Company has within a period of two years before the
date of this agreement been involved in any criminal proceedings
relating to the business of any Company.
F.4 Benefits on death, disability or leaving employment
(1) "Benefit" means any pension, lump sum, gratuity, indemnity, deferred
compensation, payment of expenses, bonus or incentive benefit, or other
benefit similar to any of these, given or to be given on or following
leaving employment, death, ill-health, injury or disablement or in
respect of any medical condition or treatment (including vision or
dental care) or in anticipation of leaving employment or after leaving
employment or after death, or be given on or in anticipation of or in
connection with any change in the nature of the employment of the
employee concerned.
"Company Schemes" mean all and each of the schemes, arrangements,
agreements, customs, practices or policies identified in the Disclosure
Letter as being relevant to this warranty and "Company Scheme" means
any of the Company Schemes.
"Company Scheme Documents" means the documents relating the Company
Schemes identified in the Disclosure Letter.
(2) Except pursuant to the Company Schemes, the Companies have not paid,
provided or contributed towards, and are not under any obligation or
commitment (whether written or
<PAGE>
99
unwritten or of an individual or collective nature) to pay, provide or
contribute towards, any Benefit for or in respect of any present or
past employee, director or other officer (or any spouse, child or
dependant thereof) of any of the Companies.
(3) The Company Scheme Documents comprise all the material documents
governing the Company Schemes including all material written
communications to beneficiaries thereunder describing the provisions of
the Company Schemes of current effect and also including the
particulars of any enhancement of benefit in respect of any person.
(4) Wherever possible under applicable law or practice, the Company Schemes
are approved by the relevant taxation and other governmental
authorities such as to enable the Companies and beneficiaries under the
Company Schemes and, in the case of a Funded Scheme, the assets held
for the purposes of the Company Schemes to enjoy favourable taxation
status possible, and, as far as the Seller is aware, there is no ground
on which such approval may be withdrawn or cease to apply.
(5) The Company Schemes have for the last two years been operated in
accordance with, and the Companies have observed and performed all
their material obligations under, the Company Schemes Documents, the
requirements of the relevant taxation and other authorities applicable
to the Company Scheme and all applicable laws and no material dispute
has, as far as the Seller is aware, arisen or been threatened in
connection with the Company Schemes.
(6) All contributions and other payments due from the participating
employers and employees have been paid to the Company Scheme.
(7) Each Company Scheme provides only money purchase benefits (as defined
in the Pension Schemes Act 1993) for the beneficiaries of each Company
Scheme.
F.5 U.S. Employee Benefits
(1) The Disclosure Letter contains the following information:
(a) a true and complete list of all employee benefit plans (within
the meaning of Section 3(3) of the U.S. Employee Retirement
Income Security Act of 1974, as amended ("ERISA"));
(b) a true and complete list of all bonus, stock option, stock
purchase, restricted stock, incentive, deferred compensation,
retiree medical or life insurance, supplemental retirement,
severance or other benefit plans, programmes or arrangements;
and
(c) a true and complete list of all employment, termination,
severance or other contracts or agreements,
in each case, to which the Company or any trade or business (whether or
not incorporated) under common control with the Company within the
meaning of U.S. Internal Revenue Code of 1986, as amended (the "Code")
Sections 414(b), (c), (m) or (o) of the Code (the "ERISA Controlled
Group") is a party, with respect to which the Company or any member of
its ERISA Controlled Group has any obligation or which are maintained,
contributed to or sponsored by the Company or its ERISA Controlled
Group for the benefit of any current or former United States employee,
officer or director of the Company or any member of its ERISA
Controlled Group (collectively, the "U.S. Plans").
<PAGE>
100
(2) Each U.S. Plan materially conforms to, and its administration is in
substantial compliance with, all applicable requirements of law,
including, without limitation, ERISA and the Code and all of the U.S.
Plans are in full force and effect as written.
(3) None of the U.S. Plans is a multiemployer plan, within the meaning of
Section 3(37) or 4001(a)(3) of ERISA (a "Multiemployer Plan"), or a
single employer pension plan, within the meaning of Section 4001(a)(15)
of ERISA, for which the Company or any member of its ERISA Controlled
Group could incur liability under Section 4063 or 4064 of ERISA (a
"Multiple Employer Plan").
(4) Neither the Company nor any member of its ERISA Controlled Group has
ever maintained, contributed to or incurred any liability with respect
to any U.S. Plan subject to Title IV of ERISA or Section 412 of the
Code (a "Pension Plan").
<PAGE>
101
G. US ADDITIONAL WARRANTIES
These warranties should apply only in relation to US Companies
G.1 Operations of the Company
Since 31st December, 1999 each Company has not:
(i) amended, or agreed to amend, its Articles of Incorporation or
bylaws; or merged with or into or consolidated with, or agreed
to merge with or into or consolidate with, any other person;
subdivided or in any way reclassified, or agreed to subdivide
or in any way reclassify, any shares of its capital stock; or
changed, or agreed to change, in any manner the rights of its
outstanding capital stock or the character of its business;
(ii) issued or sold or purchased, or agreed to issue or sell or
purchase, options or rights to subscribe to, or entered into,
or agreed to enter into, any contracts or commitments to issue
or sell or purchase, any shares of its capital stock;
(iii) agreed to enter into or amend, any employment agreement;
entered into, or agreed to enter into, any agreement with any
labor union or association representing any employee; or
agreed to enter into or amend any Employee Benefit Plan;
(iv) incurred, or agreed to incur, any indebtedness for borrowed
money or, other than in the ordinary course of business, made,
or agreed to make, any borrowings under such line of credit;
(v) declared or paid, agreed to declare or pay, any dividends; or
declared or made, or agreed to declare or make, any direct or
indirect redemption, retirement, purchase or other acquisition
of any shares of its capital stock;
(vi) made, or agreed to make, any change in its accounting methods
or practices or made, or agreed to make, any change in
depreciation or amortization policies or rates adopted by it;
(vii) materially changed, or agreed to materially change, any of its
business policies or practices, including, without limitation,
advertising, marketing, pricing, purchasing, personnel, sales,
returns, budget or product acquisition policies or practices;
(viii) suffered or incurred any damage, destruction or loss (whether
or not covered by insurance) materially adversely affecting
its assets, properties, business, operations or condition
(financial or otherwise);
G.2 Section 341(f) of Internal Revenue Code
The Company has not at any time consented under section 341(f) (l) of
the Internal Revenue Code of 1954, as amended (the "Code"), to have the
provisions of section 341(f) (2) of the Code apply to any sale of its
capital stock.
G.3 Banks, Brokers and Proxies
The Disclosure Letter sets out (i) the name of each bank, trust company
and securities or other broker or other financial institution with
which the Company maintains financial accounts; (ii)
<PAGE>
102
the name of each person authorized by the Company to effect
transactions therewith; (iii) (other than for the purposes of
intellectual property prosecution and claims) all proxies, powers of
attorney or other like instruments to act on behalf of the Company in
matters concerning its business or affairs; and (iv) all charge
accounts held in the name of the Company and the name of each director,
officer, employee or other person authorized by it to use such charge
accounts. All such accounts and credit lines are maintained by the
Company for normal business purposes, and no such proxies, powers of
attorney or other like instruments are irrevocable.
G.4 No Broker
No broker, finder, agent or similar intermediary has acted for or on
behalf of the Company in connection with this Agreement or the
transactions contemplated hereby, and no broker, finder, agent or
similar intermediary has acted for or on behalf of the Company in
connection with this Agreement or the transactions contemplated hereby,
and no broker, finder, agent or similar intermediary is entitled to any
broker's, finder's or similar fee or other commission in connection
therewith based on any agreement, arrangement or understanding with the
Company.
G.5 Tax Matters
(a) The Company and the Subsidiaries have filed all United States
federal, state, local and other non-United States Tax returns
and reports required to be filed by them and have paid and
discharged all Taxes required to be paid or discharged, other
than (a) such payments as are being contested in good faith by
appropriate proceedings and (b) such filings, payments or
other occurrences that would not have a Material Adverse
Effect. Neither the IRS nor any other United States or
non-United States taxing authority or agency is now asserting
or, to the knowledge of the Company, threatening to assert
against the Company or any Subsidiary any deficiency or claim
for any Taxes or interest thereon or penalties in connection
therewith. Neither the Company or any Subsidiary has granted
any waiver of any statute of limitations with respect to, or
any extension of a period for the assessment of any Tax. The
accruals and reserves for Taxes reflected in the Accounts are
adequate to cover all Taxes accruable through such date
(including interest and penalties, if any, thereon) in
accordance with GAAP. Neither the Company nor any Subsidiary
has made an election under Section 341(f) of the US Taxes
Code. There are no Tax liens upon any property or assets of
the Company or any of the Subsidiaries except liens for
current Taxes not yet due. Neither the Company nor any of the
Subsidiaries has been required to include in income any
adjustment pursuant to Section 481 of the US Taxes Code by
reason of a voluntary change in accounting method initiated by
the Company or any of the Subsidiaries, and the IRS has not
initiated or proposed any such adjustment or change in
accounting method, in either case which adjustment or change
would have a Material Adverse Effect. Neither the Company nor
any of the Subsidiaries has entered into a transaction which
is being accounted for under the instalment method of Section
453 of the US Taxes Code.
(b) Complete copies of federal, state, local Income Tax Returns of
the Company for the years ended December 31, 1996, December
31, 1997 and December 31, 1998 have previously been delivered
to the Purchaser. Prior to the date hereof, the Seller have
provided to the Purchaser copies of all revenue agent's
reports and other written assertions of deficiencies or other
liabilities for Taxes of the Company with respect to past
periods for which the applicable statute of limitations has
not expired. Except as set out in the Disclosure Letter, no
waivers or extensions of any applicable statute of limitations
for the assessment or collection of Taxes with respect to any
Tax Returns are currently in effect.
<PAGE>
103
(c) The Disclosure Letter sets forth the states in which the
Company files Tax Returns.
(d) The Company has not received a Tax Ruling or entered into a
Tax Closing Agreement with any taxing authority that would
have a continuing effect after the Completion. For purposes of
the preceding sentence, the term "Tax Ruling" shall mean
----------
written rulings of a taxing authority relating to Taxes, and
the term "Tax Closing Agreement" shall mean a written and
---------------------
legally binding agreement with a taxing authority relating to
Taxes.
(e) Any refunds or credits of Taxes that were paid in respect of a
taxable year or tax period (including a period deemed to be a
tax period under paragraph (d)) of the Company ending on or
before Completion shall be for the account of the Seller, and
any refund or credits of Taxes that were paid in respect of a
taxable year or tax period (including a period deemed to be a
tax period under paragraph (d)) of the Company beginning on or
after Completion shall be for the account of the Purchaser.
The Purchaser or the Seller, as the case may be, shall pay the
amount of any such refunds or credits to the other party
within fifteen (15) days after receipt thereof. The preceding
sentences shall not apply to any refunds or credits to the
extent such refunds or credits relate to a net operating loss
generated during a tax period beginning after Completion
which, at the election of the Purchaser, is carried back to a
taxable year or tax period ending prior to Completion, all of
which refunds or credits shall be for the account of the
Purchaser.
<PAGE>
104
SCHEDULE 6
BUSINESS SALE WARRANTIES
A. General
B. Taxation
C. Commercial and Financial
D. Properties
E. Business Sale Employees
A. GENERAL
A.1 Accuracy of recitals and schedules
The particulars relating to the Business and the Assets set out in the
recitals and the schedules to this agreement are true and accurate.
A.2 Seller's other interests
No member of the Seller's Group has any interest, directly or
indirectly, in any business which is or is likely to be or become
competitive with the Business.
A.3 Ownership of assets
(1) The Seller has not parted with the ownership, possession or control of,
or disposed or agreed to dispose of, or granted or agreed to grant any
option or right of pre-emption in respect of, or offered for sale, its
estate or interest in any of the Assets (including the Properties)
except (in the case of Stocks only) in the ordinary course of the
Business.
(2) None of the Assets is subject to any encumbrance (including, without
limitation, any debenture, mortgage, charge, lien, deposit by way of
security, bill of sale, lease, hire-purchase, credit-sale or other
agreement for payment on deferred terms, option or right of pre-emption
but excluding lease, hire-purchase, credit sale or other agreements for
payment on deferred terms entered into in the ordinary course of the
Companies' business) or any agreement or commitment to give or create
any of the foregoing.
(3) The Assets comprise all assets necessary for the continuation of the
Business as carried on at the date of this agreement
A.4 Vulnerable antecedent transactions
None of the Assets is liable to be transferred or re-transferred to
another person or which gives or may give rise to a right of
compensation or other payment in favour of another person under the law
of any relevant jurisdiction or country, other than pursuant to the
terms of any agreement or contract.
A.5 Compliance with statutes
Neither the Seller nor, so far as the Seller is aware, any of its
officers, agents or employees (during the course of their duties) in
relation to the Business has done or omitted to do anything which is a
contravention of any statute, order, regulation or the like giving rise
to any fine, penalty, default proceedings or other liability, except
for such violation the existence
<PAGE>
105
of which would not cause a Material Adverse Effect or would not
materially and adversely affect the ability of the Purchaser to own and
operate the Assets after Completion.
A.6 Licences and consents
The Seller has all licences (including statutory licences) and consents
necessary to carry on the Business, except where the lack of such
licence or consent, individually or in the aggregate, would not have a
Material Adverse Effect, and the Seller is not aware of anything that
might in any way prejudice the assignment or transfer of those licences
or consents to the Purchaser or the continuance or renewal of any of
them by or in the name of the Purchaser other than where such
revocation, suspension or modification would not have a Material
Adverse Effect.
A.7 Litigation and defaults
(1) The Seller is not engaged in any litigation or arbitration proceedings
affecting the Business as plaintiff or defendant (save for the
collection of trade debts in the ordinary course of business) and there
are no such proceedings pending or threatened by (save for the
collection of trade debts in the ordinary course of business) or, so
far as the Seller is aware, against the Seller.
(2) The Seller does not know of anything which is likely to give rise to
any litigation or arbitration proceedings by or against the Seller
affecting the Business.
(3) There has not been any default by the Seller under any agreement or
arrangement to which it is a party in relation to the Business and no
threat or claim of any such default has been made and is outstanding
which would have a Material Adverse Effect.
(4) The Seller has not received notice that it is the subject of any
investigation, inquiry or enforcement proceedings or process by any
governmental, administrative or regulatory body in relation to the
Business nor is the Seller aware of any thing which is likely to give
rise to any such investigation, inquiry proceedings or process.
(5) Nothing has occurred as a result of which any agreement or arrangement
affecting the Business to which the Seller is a party may be terminated
or rescinded by any other party or the Business prejudiced which would
have a Material Adverse Effect.
A.8 Environmental matters
(1) In this paragraph:
(a) "Environmental Law" means all statutes, common law, byelaws,
regulations, directives, codes of practice, circulars,
guidance notices and the like (whether in the United Kingdom
or elsewhere) concerning the protection of human health or the
environment or the conditions of the work place or the
generation, transportation, storage, treatment or disposal of
a Dangerous Substance;
(b) "Environmental Licence" means any permit, licence,
authorisation, consent or other approval required by any
Environmental Law; and
(c) "Dangerous Substance" means any natural or artificial
substance (whether in the form of solid, liquid, gas or
vapour, alone or in combination with any other substance)
capable of causing harm to man or any other living organism,
or capable
<PAGE>
106
of damaging the environment or public health or welfare, including but
not limited to any controlled, special, hazardous, toxic or dangerous
waste.
(2) The Seller has obtained all requisite Environmental Licences necessary
to own and operate the Assets and to carry on the Business (all of
which are valid and subsisting) and has at all times complied with all
applicable Environmental Law and with the terms and conditions of the
Environmental Licences. None of the operations or processes undertaken
by the Seller in relation to the Business falls to be authorised under
Part I of the Environmental Protection Act 1990.
(3) The Seller has not received any notice or other communication from
which it appears that it may be or is alleged to be in violation of any
Environmental Law or Environmental Licence in relation to the Business
or that any Environmental Licence may be subject to modification,
suspension or revocation and there are no circumstances likely to give
rise to any such violation or modification, suspension or revocation.
(4) The Seller is not, in relation to the Business, engaged in any
litigation or arbitration proceedings concerning Environmental Law or
Dangerous Substances and the Seller is not aware of any facts or
circumstances which are likely to give rise to such litigation or
arbitration proceedings affecting the Business.
(5) So far as the Seller is aware, neither the Seller nor the Purchaser (as
the Seller's successor) may be held responsible (wholly or in part) for
any clean up or other corrective action in relation to any Property and
there is no current or pending investigation or inquiry by any
regulatory authority at any Property.
(6) So far as the Seller is aware, the Seller has not used, disposed of,
generated, stored, transported, dumped, released, deposited, buried or
emitted any Dangerous Substance at, on, from or under any Property.
(7) So far as the Seller is aware, no other person has used, disposed of,
generated, stored, transported, dumped, released, deposited, buried or
emitted any Dangerous Substance at, on, from or under any Property.
(8) The Seller has not in relation to the Business disposed of any
Dangerous Substance in the past in such a way that its disposal would
now constitute a breach of Environmental Law.
(9) No Property is included on or referred to in any register of
contaminated land or any similar record or register nor are there any
facts or circumstances of which the Seller is aware which are likely to
lead to registration in the future.
A.9 Insolvency
(1) The Seller is solvent, meaning that no circumstance exists which, by
virtue of the definitions contained in s. 123 of the Insolvency Act,
the Seller is deemed unable to pay its debts.
(2) No receiver or administrative receiver has been appointed in respect of
the whole or any part of the assets or undertaking of the Seller
(including any of the Assets).
(3) No administration order has been made and no petition has been
presented for such an order in respect of the Seller.
<PAGE>
107
(4) No meeting has been convened at which a resolution will be proposed, no
resolution has been passed, no petition has been presented and no order
has been made for the winding-up of the Seller.
(5) The Seller has not stopped or suspended payment of its debts, become
unable to pay its debts or otherwise become insolvent in any relevant
jurisdiction.
(6) No unsatisfied judgement, order or award is outstanding against the
Seller in relation to the Business and no written demand under s.
123(1)(a) of the Insolvency Act has been made against the Seller and
not dispensed when due or terminated and no distress or execution has
been levied on, or other process commenced against, any part of the
Assets.
(7) No voluntary arrangement has been proposed or implemented under s. 1 of
the Insolvency Act in respect of the Seller nor any scheme of
arrangement proposed or implemented under s. 425 of the Companies Act
1985, nor any scheme for the benefit of creditors generally proposed or
implemented, whether or not under the protection of the court and
whether or not involving a reorganisation or rescheduling of debt.
(8) So far as the Seller is aware, no circumstances have arisen which
entitle any person to take any action, appoint any person, commence
proceedings or obtain any order of the type mentioned in paragraphs (1)
to (6) above.
<PAGE>
108
B. TAXATION
B.1 Tax Returns
The Seller has complied in all material respects with all statutory
provisions, rules, regulations, orders and directions in relation to
the Business concerning Value Added Tax ("VAT"), PAYE and NICs
including the making on time of accurate returns and payments and the
proper maintenance and preservation of records and the Seller has not
been given in the past seven years ending on the date hereof any
penalty, liability notice, surcharge liability notice or written
warning regarding the same.
B.2 Tax Disputes
The Seller is not involved in any dispute with the Inland Revenue, H.M.
Customs & Excise, the Contributions Agency or other appropriate fiscal
authority, whether of the United Kingdom or elsewhere concerning any
matter likely to have a material adverse affect on the Business or any
of the Assets in any way.
B.3 Stamp Duty
All documents (other than those which have ceased to have any legal
effect) to which the Seller is a party and which relate to the Business
the enforcement of which the Purchaser may be interested have been duly
stamped.
B.4 Capital Goods Scheme
None of the Assets agreed to be sold under this Agreement is a capital
item the input tax on which could be subject to adjustment in
accordance with the provisions of Part XV of the Value Added Tax
Regulations 1995.
<PAGE>
109
C. COMMERCIAL AND FINANCIAL
C.1 Books and records
All accounts, books, ledgers, and other financial records of the Seller
relating to the Business:
(i) have been properly maintained and contain accurate records of
all matters required to be entered in them by the Companies
Act 1985; and
(ii) give a true and fair view of the matters which ought to appear
in them.
C.2 Position since Accounts Date
Since the Accounts Date:
(a) the Business has been carried on in a normal and proper
manner;
(b) the Seller has not entered into any unusual contract or
commitment in relation to the Business or otherwise departed
from its normal course of trading;
(c) the Seller has paid its creditors relating to the Business
within the times agreed with them and in particular, without
limiting the foregoing, no debt except where such outstanding
debt does not and will not have a Material Adverse Effect owed
by the Seller has been outstanding for more than 95 days from
the date of invoice; and
(d) the policies for the payment of creditors which have been
applied during the financial period ended on the Accounts Date
have been continued and, in particular, there has been no
unusual postponement of the payment of creditors or unusual
acceleration of the collection of Debts in either case having
regard to the policies applied for such payment and collection
prevailing in the financial period ended on the Accounts Date;
and
(e) there has been no unusual augmentation or unusual diminution
in the level of the Stock.
C.3 Agencies, etc.
(a) The Seller is not in relation to the Business a party to any
agency, distributorship, marketing, or licensing agreement or
arrangement not in the ordinary course of the Business.
C.4 Anti-competitive arrangements
(1) In relation to the Business, the Seller, and has not during the last
two years entered into any agreement or arrangement or concerned
practice nor does it conduct or has it conducted its business affairs
in a manner which:
(a) was subject to registration under the Restrictive Trade
Practices Acts 1976 and 1977 (as amended);
(b) contravenes the provisions of the Resale Prices Act 1976 (as
amended) or any secondary legislation adopted under the Fair
Trading Act 1973;
<PAGE>
110
(c) would infringe any provision of the Competition Act 1998;
(d) infringes Article 81 or 82 (formerly Articles 85 and 86) of
the Treaty establishing the European Community or any other
anti-trust or similar legislation in any jurisdiction in which
the Business is carried on or has sales or in which any of the
Assets is located; or
(e) is void or unenforceable (whether in whole or in part) or may
render it liable to proceedings under any such legislation as
is referred to in paragraphs (a) to (d) above.
(2) In relation to the Business, the Seller, and has not during the last
two years entered into any agreement or arrangement or been involved in
any business practice in respect of which an undertaking has been given
by or an order made against or in relation to it pursuant to any
anti-trust or similar legislation in any jurisdiction in which it
carries on business or has assets or sales, including (without
limitation):
(a) Article 81 or 82 (formerly Articles 85 and 86) of the Treaty
establishing the European Community;
(b) the Restrictive Trade Practices Acts 1976 and 1977 (as
amended);
(c) the Resale Prices Act 1976 (as amended);
(d) the Fair Trading Act 1973 or any secondary legislation adopted
under that Act; and
(e) the Competition Act 1980 (as amended).
(3) In relation to the Business the Seller is not now, and has not during
the last two years been, a party to any agreement or arrangement or
been involved in any business practice in respect of which:
(a) any request for information, statement of objections or
similar matter has been received from any court, tribunal,
governmental, national or supra-national authority; or
(b) an application for negative clearance or exemption has been
made to the Commission of the European Communities; or
(c) an application for early guidance has been made under the
Competition Act 1998 to the Office of Fair Trading.
C.5 Secret or confidential information or property
Except as would not have a Material Adverse Effect, the Seller has
taken reasonable steps in accordance with normal industry practice to
maintain (in relation to the Business) the confidentiality of its
material trade secrets and other confidential Intellectual Property
Rights in respect of the Business. So far as the Seller is aware (i)
there has been no misappropriation of material trade secrets or other
material confidential Intellectual Property Rights (ii) no employee,
independent contractor or agent of the Seller has misappropriated any
material trade secret of any other person in the course of such
performance as an employee, independent contractor or agent of the
Seller in material default or breach of any terms of any employment
agreement, non-disclosure agreement, assignment of invention agreement
or similar agreement.
<PAGE>
111
C.6 Intellectual Property Rights
(1) So far as the Seller is aware no activities of the Seller in relation
to the Business (or by any licensee under any licence granted by the
Seller or any member of the Seller's Group in connection with the
Business) infringe any Intellectual Property Rights of any third party
and no claim has been made against the Seller or any such licensee in
respect of any such infringement.
(2) Full details of all registered Business Intellectual Property and all
applications for registration of Business Intellectual Property are set
out in the Disclosure Letter.
(3) The Seller (or the member of the Seller's Group identified in the
Disclosure letter as the owner or applicant) is the sole legal and
beneficial owner of or applicant of the Business Intellectual Property
referred to in paragraph (2) above. None of such Business Intellectual
Property has lapsed or been cancelled and so far as the Seller is
aware, nothing has been done or omitted to be done which would
prejudice the validity or enforceability of any such Business
Intellectual Property.
(4) So far as the Seller is aware, no challenge has been made to the
subsistence, validity or ownership of any Business Intellectual
Property.
(5) The Business Intellectual Property, together with those Intellectual
Property Rights the subject of the licence agreements referred to in
the Material Contracts, comprises all Intellectual Property Rights
required to carry on the Business as it has been carried on during the
year prior to the date of this agreement.
(6) So far as the Seller is aware, the operation of the Business as
conducted at any time during the previous 12 months does not infringe,
dilute or misappropriate the Intellectual Property Rights of any third
party and the ability of the Business to use such Intellectual Property
Rights will not be affected by the acquisition of the Business by the
Purchaser. Furthermore no claim, suit, action, arbitration, inquiry,
proceedings or investigation has been asserted, is pending or is
threatened against the Business alleging that the operation of the
Business infringes or misappropriates the Intellectual Property Rights
of any third party.
(7) The Seller is not aware of any unauthorised use by any person of any
Business Intellectual Property or Information of a confidential nature.
C.7 Information
(1) All Information used by the Seller in relation to the Business is owned
by or is the subject of a valid grant of rights to the Seller and is
not subject to any restriction which materially and adversely affects
the Seller's ability to use it for the purposes of the Business.
(2) The Seller has not disclosed and is not obliged to disclose any
Information of a confidential nature to any person other than its
employees.
C.8 Business names
The Seller does not carry on the Business under a name other than its
own corporate name.
<PAGE>
112
C.9 VAT - Capital Goods Scheme
In respect of each of the Assets (if any) for which the Purchaser will
as a result of its transfer under this agreement become responsible for
any future adjustments under Part XV of the VAT Regulations 1995 the
Disclosure Letter sets out accurately:
(a) the capital item affected;
(b) the amount of the "total input tax" which is subject to
adjustment;
(c) the percentage of that input tax which was reclaimable on the
capital item in the first interval applicable to it; and
(d) the date of acquisition of the capital item and the number of
intervals in the adjustment period remaining from the date of
transfer of the capital item under this agreement.
C.10 Systems compliance
(1) The Material Business Computer Systems are Date Compliant.
For the purposes of this warranty:
"Date Compliant" means that neither the performance nor functionality
of the Business Computer Systems is affected by dates prior to, during
and after the year 2000, and in particular in respect of the Business
Computer Systems:
(a) no value for a current date will cause any interruption in
operation;
(b) date-based functionality will behave consistently for dates
prior to, during and after year 2000;
(c) in all interfaces and data storage, the century in any date
will be specified and displayed either explicitly or by
unambiguous algorithms or inferencing rules; and
(d) Year 2000 will be recognised as a leap year, and otherwise
conform to the quad-centennial rule.
"Business Computer Systems" means the Business Hardware, the Business
Software and the Business Telecommunications Equipment;
"Business Hardware" means the computer hardware and peripherals used by
the Seller exclusively or primarily in relation to the Business;
<PAGE>
113
"Business Software" means the software used by the Seller exclusively
or primarily in relation to the Business the rights in which are owned
by a third party and licensed to the Seller;
"Business Telecommunications Equipment" means the telecommunications
equipment used by the Seller exclusively or primarily in relation to
the Business (including all equipment used as part of the Seller's
computer networks);
"Owned Software" means the software used by the Seller exclusively or
primarily in relation to the Business, the rights in which vest legally
and beneficially in the Seller.
(2) Except as would not have a Material Adverse Effect, the Seller has
valid licences to use the Business Software required for the carrying
on of the Business. The Seller has not received notice that it is in
breach of any of the licences relating to the Business Software.
(3) There have been no claims by any third party that the use of any
element of the Business Computer Systems infringes any Intellectual
Property Rights, or violates any other legal rights of such third
party, nor is the Seller aware of anything which has been done or
omitted to have been done which might give rise to such a claim.
(4) The Seller is not aware of any infringement by third parties of any
rights including Intellectual Property Rights in relation to any part
of the Business Computer Systems.
(5) No action is needed to enable the Purchaser to continue using the
Business Computer Systems (other than obtaining third party consents to
the assignment of the Business Software if necessary) following the
transaction which is the subject matter of this Agreement in
substantially the same manner and to substantially the same extent as
used at the date of this Agreement.
(6) During the twelve months prior to the date hereof, none of the Business
Hardware, Business Software or Business Telecommunications Equipment
has failed whether by reason of bugs, or equipment breakdown, or for
any other reason ("Performance Failure") such as to cause disruption or
interruption or loss to the Business which in any such case is
significant or repeated, have a Material Adverse Effect and the Seller
is not aware of any circumstances existing at the date hereof which
could result in the occurrence of a Performance Failure.
(7) There are no payments due to third parties under material leases,
licences or services agreements relating to the Business Computer
Systems which are due and which have not been paid, nor is the Seller
aware of any fact or matter which could result in the lawful
termination by any third party lessor or licensor of any such leases or
licences, or the avoidance of any obligation or withholding of consent
by such third party.
(8) The Seller owns or has the right to use the Business Hardware and
Business Telecommunications Equipment as carried on at the date of this
Agreement.
(9) The Business Computer Systems are free and clear of all liens,
restrictions, charges, encumbrances, or claims of any party, including
but not limited to, employees, agents, consultants, or customers (save
for the rights of third party licensors in respect of the Business
Licensed Software).
(10) To the best of the Seller's knowledge, there have been no instances at
any time prior to the date hereof of unauthorised entry into the
Business Computer Systems by any party (whether or not resulting in
damage to any element of the Business Computer Systems, or any data
<PAGE>
114
stored therein, and whether or not carried out by any current or former
employee or other third party).
(11) The Business Computer Systems have been satisfactorily maintained.
(12) The Seller has had adequate procedures to ensure internal and external
security of the material Business Computer Systems including procedures
for taking and storing, on-site and off-site, back-up copies of
computer programs and data.
(13) The Seller is not aware of any claim or dispute relating (without
limitation) to the ownership, functionality, performance, maintenance,
payment obligations or right to use any part of the Business Computer
Systems.
(14) The Seller has not released the source code to any Business Software
pursuant to any escrow agreement or arrangement to which the Seller is
a party.
(15) In the event that any person providing maintenance or support services
for any of the Business Software material to the Business, ceases or is
unable to do so the Seller has all necessary rights to obtain the
source code and all related technical and other information to procure
the carrying out of such services by the Seller's own employees or by a
third party and such rights will not be affected by the transaction
contemplated in this Agreement.
(16) There is no Owned Software.
C.11 Data and Records
(1) All the records and systems (including but not limited to computer
systems) and all data and information of the Seller are recorded,
stored, maintained or operated or others held exclusively by the Seller
and are not wholly or partly dependent on any facilities or means
(including any electronic, mechanical or photographic process,
computerised or otherwise) which are not under the exclusive ownership
and control of the Seller.
(2) The Seller is registered under the Data Protection Legislation in the
UK.
(3) The Seller has not received a notice or allegation from either the data
protection registrar controller or a data subject alleging
non-compliance with the Data Protection Legislation or any of the data
protection principles, requiring the Seller to change or delete any
data or prohibiting the transfer of data to a place outside the United
Kingdom.
(4) No individual has claimed compensation from the Seller under the Data
Protection Legislation for loss or unauthorised disclosure of data
prior to Completion.
(5) The Seller has not sold to a third party any information or data of or
relating to a customer of the Business.
(6) For the purposes of this warranty:
"Data Protection Legislation" means all statutes, enacting instruments,
common law, regulations, directives, codes of practice, circulars
guidance notes, decisions, recommendations and the like (whether in the
United Kingdom, the European Union or elsewhere) concerning the
protection and/or processing of personal data.
<PAGE>
115
C.12 Content Licence Agreement
(1) The Seller represents that its and the Companies' standard forms of
content license agreement contain a clause whereby the licensor agrees
to indemnify the licensee in the event of a third party claim
pertaining to the content under license, and that substantially all of
its executed license agreements contain a provision of that effect,
provided that Seller does not warrant that each and every such clause
will be enforceable by the Purchaser.
(2) Neither the Seller nor any of the Companies has received any written
claims or demands of the kind described in Paragraph A.8(1) of the
Disclosure Letter, nor have they received any written notification that
threatens to name Seller or the Company as a defendant in any
litigation based on Certain Copyright Issues that are the subject
matter of the litigations referenced in Paragraph A.8(1).
<PAGE>
116
D. PROPERTIES
D.1 Good and marketable title
(1) The Properties listed in Part I of Schedule 4 are the only properties
owned, controlled, used or occupied by the Seller in connection with
the Business .
(2) The Seller is the legal and beneficial owner in possession of each
Property and is in exclusive occupation of it.
D.2 Roads and services
The Seller has a permanent legal right free from onerous and unusual
conditions to use all roads and conducting media serving each Property
in the manner in which they are presently used so far as it is aware.
D.3 Free from encumbrances
So far as the Seller is aware each Property is free from encumbrances
or third party rights of any kind whatever which would materially
adversely affect it.
D.4 Covenants
So far as the Seller is aware no material breach of any covenant
affecting the titles to the Properties is outstanding and the rent has
been paid up to date.
D.5 Disputes
There are no material disputes regarding boundaries, easements,
covenants or other matters relating to any Property or its use so far
as the Seller is aware.
D.6 Planning
There is no notice of breach of or objection under the Planning Acts or
of any relevant bye-laws, building regulations and other similar
legislation in relation to the Seller's occupation or use of any
Property so far as the Seller is aware.
D.7 Notices, orders and proposals
(1) The Seller has not received any notice or order affecting any Property
from any Government department, any authority or any third party and so
far as the Seller is aware there are no proposals on the part of any
Government department or any authority which would adversely affect any
Property, including, without limitation, those relating to compulsory
purchase or highways works.
(2) No notices have been given or received under any lease and there are no
subsisting disputes between the Seller and the reversioner in relation
to any lease .
D.8 Repair
All buildings or other erections on each Property are in the Seller's
opinion in good and substantial repair and condition and are in such
condition and state of repair as to be
<PAGE>
117
substantially fit for the purpose for which they are at present used
and do not contain any substance or material which is defective or a
risk to health or safety.
D.9 Schedules
The statements regarding the Properties at Part I of Schedule 4 are
true and accurate.
<PAGE>
118
E. BUSINESS SALE EMPLOYEES
E.1 Interpretation
In this paragraph:
"retirement/death/disability benefit" means any pension, lump sum,
gratuity or other like benefit given or to be given on retirement or on
death, or in anticipation of retirement, or, in connection with past
service, after retirement or death, or to be given on or in
anticipation of or in connection with any change in the nature of the
service of the Business Sale Employee in question or given or to be
given on or in connection with the illness, injury or disability of, or
suffering of any accident by, an Business Sale Employee;
"trade dispute" has the same meaning as in the Trade Union and Labour
Relations (Consolidation) Act 1992.
E.2 Particulars disclosed
Schedule 9 and the Disclosure Letter together contain the following
information:
(a) the names of all the Business Sale Employees;
(b) full particulars of any person who has accepted an
offer of employment in the Business made by the
Seller but whose employment has not yet started and
of any outstanding offer of employment in the
Business made to any person by the Seller;
(c) the standard terms and conditions of the Business
Sale Employee;
(d) full particulars of any agreement for the provision
of consultancy services or the services of personnel
to the Seller and of the terms applicable to the
secondment to the Seller of any person; and
(e) a description of the constitution of any body of
employee representatives, staff association or the
like;
E.3 Business Sale Employees and terms and conditions of employment
(1) Each of the Business Sale Employees works in the United Kingdom and is
employed by the Seller or a member of the Seller's Group registered in
the United Kingdom or by a company registered in the United Kingdom.
(2) The Business Sale Employees are all the persons that the Seller
reasonably considers are employed wholly or mainly in the Business.
(3) No Business Sale Employee whose name is listed in Schedule 9 or
pursuant to paragraph E.2(a) has given, or has been given, notice of
termination of his employment.
(4) There is no arrangement in operation by or in relation to the Seller
under which any Business Sale Employee or other person is entitled to
remuneration of any sort (including, without limitation, bonus,
commission or profit sharing) by reference to the turnover or profits
of the whole or any part of the Business and no such arrangement has
been operated on a customary or discretionary basis.
<PAGE>
119
(5) No proposal, assurance or commitment has been communicated to any
person regarding any material change to his terms of employment or
working conditions or regarding the continuance, introduction, increase
or improvement of any benefit or any discretionary arrangement and no
negotiations have commenced for any such matter.
(6) All subsisting contracts of employment and any agreement as mentioned
in paragraph E.2(d) are terminable by it on three months' notice or
less without compensation (other than compensation in respect of the
applicable notice period.
(7) The Seller has no liability to pay compensation for loss of office or
employment or a redundancy payment to any Business Sale Employee or
person previously employed in the Business or any payment for breach of
any agreement referred to in paragraph E.2(d) and no such sums have
been paid (whether pursuant to a legal obligation or ex gratia) since
31st December, 1999.
(8) There is no term of employment for any Business Sale Employee which
provides that a change of control of the Business shall entitle the
Business Sale Employee to treat the change of control as amounting to a
breach of the contract or entitling him to any payment or benefit
whatsoever or entitling him to treat himself as redundant or otherwise
dismissed or released from any obligation.
(9) The Seller has no obligation to make any payment on redundancy in
excess of the statutory redundancy payment and the Seller has not
operated any discretionary practice of making any such excess payments.
(10) Except in respect of reimbursement of out-of-pocket expenses and normal
accruals of emoluments after 31st December, 1999, no sum is owing or
promised to any Business Sale Employee.
(11) The Seller has not made any material loan or advance, or provided any
material financial assistance to any Business Sale Employee or person
previously employed or to be employed in the Business, which is
outstanding.
(12) Since the Emoluments Date, no material change has been made in the rate
of the emoluments of any Business Sale Employee other than changes in
the ordinary course of business of the Seller.
E.4 Disputes
(1) The Seller has in all material respects complied with its obligations
to applicants for employment, the Business Sale Employees and persons
previously employed in the Business, any relevant trade union and
business sale employee representatives.
(2) No claim in relation to the Business Sale Employees or persons
previously employed in the Business has been made or threatened against
the Seller.
(3) No enquiry or investigation materially affecting the Business has been
made or threatened by any enforcement regulatory or supervisory body in
respect of any act, event, omission or other matter arising out of or
in connection with:
(a) any application for employment by any person;
<PAGE>
120
(b) the employment (including terms of employment, working
conditions, benefits and practices) or termination of
employment of any person;
and, the Seller is not aware of any circumstance which may give rise to
any such claim or investigation.
(4) There is not, and during the two years preceding the date of this
agreement there has not been, any collective labour disputes or
industrial action affecting the Business and the Seller is not aware of
any circumstance which might give rise to industrial action.
(5) No Business Sale Employee has within a period of two years before the
date of this agreement been involved in any criminal proceedings
relating to the Business and the Seller is not aware of any
circumstances which are likely to give rise to any such proceedings.
E.5 Collective matters
(1) The Seller has not recognised a trade union.
(2) The Seller is not a party to any collective agreement, dismissal
procedures agreement, union membership agreement, trade dispute or
proceedings before any court or tribunal and the Seller is not aware of
any circumstance which might give rise to it becoming a party to any
such agreement or becoming involved in any such dispute or proceedings.
E.6 Pensions
Except pursuant to the group personal pension arrangement disclosed in
the Disclosure Letter, the Seller has not paid, provided or contributed
towards, and is not under any obligation or commitment (whether or not
legally enforceable) to pay, provide or contribute towards, any
retirement/death/disability benefit for or in respect of any Business
Sale Employee or person previously employed in the Business (or any
spouse, child or dependant of any of them).
<PAGE>
121
SCHEDULE 7
COMPLETION ARRANGEMENTS
1. The Seller shall deliver or cause to be delivered:
(a) duly executed transfers into the name of the Purchaser or the
Nominated Purchaser in respect of the Shares and any shares in
any of the Companies not registered in the name of the
companies named in Schedule 1 Part A or such other local
agreements in respect of the sale of the Shares or the
transfer of shares in any company as may be required under
local legislation;
(b) share certificates in respect of all the Shares and any shares
in any of the Companies not registered in the name of the
companies named in Schedule 1 Part A (or an express indemnity
in the case of any found to be missing);
(c) the common or corporate seal (where it exists), all minute
books, share register and share certificate books (with any
unissued share certificates) and other statutory books of each
of the Companies;
(d) the Tax Deed duly executed by the Seller;
(e) the resignations of the secretary and all of the directors of
each of the Companies other than those marked "*" in Schedule
1 in each case acknowledging that he has no claim against the
respective Company whether for loss of office or otherwise.
(f) the resignations of the auditors of each Company as requested
by the Purchaser;
(g) a share certificate in the name of the Purchaser or its
nominee representing the New Shares;
(h) a duly executed Distribution Agreement;
(i) a duly executed Software Licence and Maintenance Agreement;
(j) copies of the change of name resolution of the Seller and any
member of the Sellers Group whose name includes the word
"Dialog", which resolutions the Seller will file or procure to
be filed within the relevant time requirement;
(k) certificate by two directors of the Seller confirming that the
Seller has complied with the provisions of clause 8(4);
(l) evidence of the ownership of shares in Market Intelligence
Research Corporation Cdba Frost & Sullivan);
(m) duly executed transfers of domain names as set out in Schedule
10;
(n) evidence of resolution of the matters set out against
paragraphs A.2(2) and A.2(3) in Appendix A to the Disclosure
Letter;
<PAGE>
122
(o) evidence of the capitalisation of the excess over
US$160,000,000 of the loan owed by Dialog Corp to the Seller
(such capitalisation taking the form of the issue of shares in
satisfaction of amounts owed in respect of such loan).
2. The Seller shall procure that meetings of the directors or members (as
necessary) of each of the Companies are held at Completion at which the
following businesses is transacted:
(a) the directors of each company shall approve for resignation
(subject to their being duly stamped) the relevant transfers
referred to in subclause 1(a) above;
(b) the situation of the registered offices of each Company shall
be changed as the Purchaser may direct;
(c) such persons as the Purchaser shall nominate shall be
appointed as secretary and directors of each Company; and
(d) such firm as the Purchaser nominates shall be appointed as
auditors of each Company.
3. The Seller and the Purchaser shall enter into or shall procure to be
entered into local sale agreements in a form reasonably acceptable to
the Purchaser transferring the relevant Shares.
4. The Seller shall:
(a) let the Purchaser or its nominee into possession of the Assets
and at Completion occupation of the Properties and the land
held under the Leases;
(b) execute and deliver to the Purchaser a Property Transfer in
favour of the Purchaser or its nominee of each of the
Properties as are assigned or transferred at Completion in an
agreed form;
(c) deliver to the Purchaser all the title deeds and documents
relating to the Leases and such of the Properties as are
conveyed, assigned or transferred at Completion;
(d) deliver to the Purchaser assignments in the Agreed From of the
registered Business Intellectual Property duly executed by the
Seller or by any member of the Seller's Group which is the
registered owner of the same of the extent it is not
registered in the name of any of the Companies;
(e) deliver to the Purchaser the Information and all other
records, documents, lists, catalogues, literature, and
materials as are included in, or relate to, the Assets and the
Employees;
(f) releases of charges and other securities over the Assets and
the Shares and assets of the Companies including the release
of any registration of any such security at any relevant Trade
Marks Registry.
5. The Purchaser shall cause to be delivered:
(a) the Tax Deed duly executed by the Purchaser or the Nominated
Purchaser as the case may be;
(b) a duly executed Distribution Agreement;
(c) a duly executed Software Licence and Maintenance Agreement.
<PAGE>
123
SCHEDULE 8
BUSINESS INTELLECTUAL PROPERTY
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
KEY TO THE PROPRIETOR NAMES:
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
The Dialog Corp., plc = The Dialog Corporation, plc
---------------------------------------------------------------------------------------------------------
MAID = Market Analysis and Information Databases, plc
---------------------------------------------------------------------------------------------------------
</TABLE>
Page 2 of 7
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc Gold-EDOCS 42 Pending
-------------------------------------------------------------------------------------------------------------------
USA MAID RESEARCHLINE 2045405 17/03/97 35 18/03/07 Registered
-------------------------------------------------------------------------------------------------------------------
United Kingdom MAID RESEARCHLINE* 2022232 30/05/95 35 30/05/05 Registered
-------------------------------------------------------------------------------------------------------------------
Benelux MAID WEBLINE 591880 03/04/96 9 03/04/06 Registered
-------------------------------------------------------------------------------------------------------------------
Benelux MAID WEBLINE 591880 03/04/96 35 03/04/06 Registered
-------------------------------------------------------------------------------------------------------------------
Benelux MAID WEBLINE 591880 03/04/96 36 03/04/06 Registered
-------------------------------------------------------------------------------------------------------------------
USA MAID WORLDSEARCH* 2159869 24/05/98 35 24/05/08 Registered
-------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc VIRTUAL PUBLISHING 396275 15/10/96 9 15/10/06 Registered
-------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc VIRTUAL PUBLISHING 396275 15/10/96 35 15/10/06 Registered
-------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc VIRTUAL PUBLISHING 396275 15/10/96 38 15/10/06 Registered
-------------------------------------------------------------------------------------------------------------------
France The Dialog Corp, plc WEBLINE 95603115 27/12/95 9 27/12/05 Registered
-------------------------------------------------------------------------------------------------------------------
France The Dialog Corp, plc WEBLINE 95603115 27/12/95 35 27/12/05 Registered
-------------------------------------------------------------------------------------------------------------------
United Kingdom The Dialog Corp, plc WEBLINE 2045453 22/11/95 35 22/11/05 Registered
-------------------------------------------------------------------------------------------------------------------
France The Dialog Corp, plc WEBLINE 95603115 27/12/95 36 27/12/05 Registered
-------------------------------------------------------------------------------------------------------------------
United Kingdom The Dialog Corp, plc WEBLINE 2045453 22/11/95 36 22/11/05 Registered
-------------------------------------------------------------------------------------------------------------------
France The Dialog Corp, plc WEBLINE 95603115 27/12/95 38 27/12/05 Registered
-------------------------------------------------------------------------------------------------------------------
France The Dialog Corp, plc WEBLINE 95603115 27/12/95 42 27/12/05 Registered
-------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc WEBLINE* 35 Pending
-------------------------------------------------------------------------------------------------------------------
Taiwan The Dialog Corp, plc DIALOG 1 15/11/06 Pending
-------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc DIALOG 9 Pending
-------------------------------------------------------------------------------------------------------------------
Taiwan The Dialog Corp, plc DIALOG 9 15/11/06 Pending
-------------------------------------------------------------------------------------------------------------------
United Kingdom The Dialog Corp, plc DIALOG 9 Pending
-------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation 9 Pending
-------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation 9 Pending
-------------------------------------------------------------------------------------------------------------------
South Africa The Dialog Corp, plc The Dialog Corporation 9 Pending
-------------------------------------------------------------------------------------------------------------------
United Kingdom The Dialog Corp, plc The Dialog Corporation 9 Pending
-------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation 35 Pending
-------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation 35 Pending
-------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 3 of 7
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
South Africa The Dialog Corp, plc The Dialog Corporation 35 Pending
--------------------------------------------------------------------------------------------------------------------------
United Kingdom The Dialog Corp, plc The Dialog Corporation 35 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation 36 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation 42 Pending
--------------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation 42 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation & device 9 Pending
--------------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation & device 9 Pending
--------------------------------------------------------------------------------------------------------------------------
South Africa The Dialog Corp, plc The Dialog Corporation & device 9 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation & device 35 Pending
--------------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation & device 35 Pending
--------------------------------------------------------------------------------------------------------------------------
South Africa The Dialog Corp, plc The Dialog Corporation & device 35 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation & device 36 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc The Dialog Corporation & device 42 Pending
--------------------------------------------------------------------------------------------------------------------------
Hong Kong The Dialog Corp, plc The Dialog Corporation & device 42 Pending
--------------------------------------------------------------------------------------------------------------------------
South Africa The Dialog Corp, plc The Dialog Corporation & device 42 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc TRADSTAT 9 Pending
--------------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc TRADSTAT 9 Pending
--------------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc TRADSTAT 9 Pending
--------------------------------------------------------------------------------------------------------------------------
Switzerland The Dialog Corp, plc TRADSTAT 461468 25/05/99 9 16/11/08 Registered
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc TRADSTAT 35 Pending
--------------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc TRADSTAT 35 Pending
--------------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc TRADSTAT 35 Pending
--------------------------------------------------------------------------------------------------------------------------
Switzerland The Dialog Corp, plc TRADSTAT 461468 25/05/99 35 16/11/08 Registered
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc TRADSTAT 36 Pending
--------------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc TRADSTAT 36 Pending
--------------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc TRADSTAT 36 Pending
--------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc TRADSTAT 38 Pending
--------------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc TRADSTAT 38 Pending
--------------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc TRADSTAT 38 Pending
--------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 4 of 7
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Switzerland The Dialog Corp, plc TRADSTAT 461468 25/05/99 38 16/11/08 Registered
----------------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc TRADSTAT 42 Pending
----------------------------------------------------------------------------------------------------------------------------
Japan The Dialog Corp, plc TRADSTAT 42 Pending
----------------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc TRADSTAT 42 Pending
----------------------------------------------------------------------------------------------------------------------------
Switzerland The Dialog Corp, plc TRADSTAT 461468 25/05/99 42 16/11/08 Registered
----------------------------------------------------------------------------------------------------------------------------
Benelux MAID CORPORATE PROFOUND 590735 21/02/96 9 21/02/06 Registered
----------------------------------------------------------------------------------------------------------------------------
United Kingdom MAID CORPORATE PROFOUND 2060526 09/03/96 9 09/03/06 Registered
----------------------------------------------------------------------------------------------------------------------------
Benelux MAID CORPORATE PROFOUND 590735 21/02/96 35 21/02/06 Registered
----------------------------------------------------------------------------------------------------------------------------
United Kingdom MAID CORPORATE PROFOUND 2060526 09/03/96 35 09/03/06 Registered
----------------------------------------------------------------------------------------------------------------------------
United Kingdom MAID CUSTOM ALERT 2014761 20/03/95 35 20/03/05 Registered
----------------------------------------------------------------------------------------------------------------------------
Benelux MAID NCM PROFOUND 582322 11/03/96 9 11/03/06 Registered
----------------------------------------------------------------------------------------------------------------------------
Benelux MAID NCM PROFOUND 582322 11/03/96 35 11/03/06 Registered
----------------------------------------------------------------------------------------------------------------------------
Benelux MAID NCM PROFOUND 582322 11/03/96 36 11/03/06 Registered
----------------------------------------------------------------------------------------------------------------------------
France MAID PROFOUND 34689 21/12/94 35 21/12/04 Registered
----------------------------------------------------------------------------------------------------------------------------
Germany MAID PROFOUND 39408695 23/12/94 35 23/12/04 Registered
----------------------------------------------------------------------------------------------------------------------------
USA MAID PROFOUND 2057887 29/04/97 35 29/04/07 Registered
----------------------------------------------------------------------------------------------------------------------------
China MAID PROFOUND* 939550 28/01/97 35 27/01/07 Registered
----------------------------------------------------------------------------------------------------------------------------
Italy MAID PROFOUND* 706233 22/12/94 35 22/12/04 Registered
----------------------------------------------------------------------------------------------------------------------------
Japan MAID PROFOUND* 4092683 12/12/97 35 12/12/07 Registered
----------------------------------------------------------------------------------------------------------------------------
Singapore MAID PROFOUND* B11170/94 27/12/94 35 27/12/04 Registered
----------------------------------------------------------------------------------------------------------------------------
Taiwan MAID PROFOUND* 80578 16/01/96 35 16/01/06 Registered
----------------------------------------------------------------------------------------------------------------------------
United Kingdom MAID PROFOUND* 2005258 19/12/94 35 19/12/04 Registered
----------------------------------------------------------------------------------------------------------------------------
USA MAID PROFOUND* 2057887 29/04/97 42 29/04/07 Registered
----------------------------------------------------------------------------------------------------------------------------
Canada MAID PROFOUND* 467472 11/12/96 11/12/11 Registered
----------------------------------------------------------------------------------------------------------------------------
Denmark The Dialog Corp, plc CORPORATE PROFOUND 05.831 1996 18/10/96 9 18/10/06 Registered
----------------------------------------------------------------------------------------------------------------------------
Norway The Dialog Corp, plc CORPORATE PROFOUND 185.822 16/10/97 9 17/10/07 Registered
----------------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc CORPORATE PROFOUND 320259 13/12/96 9 13/12/06 Registered
----------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 5 of 7
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
Denmark The Dialog Corp, plc CORPORATE PROFOUND 05.831 1996 18/10/96 35 18/10/06 Registered
-----------------------------------------------------------------------------------------------------------------------
Norway The Dialog Corp, plc CORPORATE PROFOUND 185.822 16/10/97 35 17/10/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc CORPORATE PROFOUND 320259 13/12/96 35 13/12/06 Registered
-----------------------------------------------------------------------------------------------------------------------
Norway The Dialog Corp, plc CORPORATE PROFOUND 185.822 16/10/97 36 17/10/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc CORPORATE PROFOUND 320259 13/12/96 36 13/12/06 Registered
-----------------------------------------------------------------------------------------------------------------------
Denmark The Dialog Corp, plc PROFOUND 35611 30/06/97 9 30/06/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc PROFOUND 325006 03/10/97 9 03/10/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Benelux The Dialog Corp, plc PROFOUND 590736 21/02/96 35 21/02/06 Registered
-----------------------------------------------------------------------------------------------------------------------
Norway The Dialog Corp, plc PROFOUND 186.917 04/12/97 35 04/12/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc PROFOUND 325006 03/10/97 35 03/10/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Norway The Dialog Corp, plc PROFOUND 186.917 04/12/97 36 04/12/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Sweden The Dialog Corp, plc PROFOUND 325006 03/10/97 36 03/10/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Finland The Dialog Corp, plc CORPORATE PROFOUND 206315 13/06/97 9 13/06/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Finland The Dialog Corp, plc CORPORATE PROFOUND 206315 13/06/97 35 13/06/07 Registered
-----------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc DataStar Appl in Process
-----------------------------------------------------------------------------------------------------------------------
Argentina The Dialog Corp, plc DIALOG 1214736 02/12/86 42 02/12/96 Registered
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc PROFOUND 681380 26/05/99 9 20/12/00 Registered
-----------------------------------------------------------------------------------------------------------------------
Benelux The Dialog Corp, plc PROFOUND 590736 21/02/96 9 21/02/00 Registered
-----------------------------------------------------------------------------------------------------------------------
Finland The Dialog Corp, plc PROFOUND 204507 14/04/97 9 14/02/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc PROFOUND 681380 26/05/99 35 20/12/00 Registered
-----------------------------------------------------------------------------------------------------------------------
Finland The Dialog Corp, plc PROFOUND 204507 14/04/97 35 14/02/07 Registered
-----------------------------------------------------------------------------------------------------------------------
Benelux The Dialog Corp, plc PROFOUND 590736 21/02/96 36 21/02/06 Registered
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc PROFOUND 681380 26/05/99 38 20/12/00 Registered
-----------------------------------------------------------------------------------------------------------------------
Denmark The Dialog Corp, plc PROFOUND* 35 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation 9 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation 9 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation 35 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation 35 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation 36 Pending
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 6 of 7
<PAGE>
The Dialog Corporation, plc
Trademark Summary
<TABLE>
<CAPTION>
Country Proprietor Trademark Regis.# Regis. Date Class Renewal Date STATUS
------- ---------- --------- ------- ----------- ----- ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation 36 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation 42 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation 42 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation & device 9 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation & device 9 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation & device 35 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation & device 35 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation & device 36 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation & device 36 Pending
-----------------------------------------------------------------------------------------------------------------------
Australia The Dialog Corp, plc The Dialog Corporation & device 42 Pending
-----------------------------------------------------------------------------------------------------------------------
Canada The Dialog Corp, plc The Dialog Corporation & device 42 Pending
-----------------------------------------------------------------------------------------------------------------------
CTM The Dialog Corp, plc GOLD-eDOCS
-----------------------------------------------------------------------------------------------------------------------
USA The Dialog Corp, plc Gold-EDOCS 9 Pending
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 7 of 7
<PAGE>
124
SCHEDULE 9
BUSINESS SALE EMPLOYEES
<PAGE>
DIALOG CORPORATION UK PAYROLL-UK STAFF LIST-MARCH 2000
NAME DEPT LOCATION DOB START DATE
ADDICOTT, IRENE (P/T) 9 UK-OXFORD 10/09/37 01-Jan-97
BAYLY, POLLY 9 UK-OXFORD 26/07/75 01-Sep-98
BEAUMONT, ROGER 9 UK-OXFORD 18/11/45 04-Jan-99
CHRISTIAN, JOHN 9 UK-OXFORD 05/07/53 04-Jan-99
CORK, PHILIP 9 UK-OXFORD 10/02/60 04-Jan-99
DOWLING, URSULA 9 UK-OXFORD 24/10/71 01-May-99
FELTHAM, SUSAN 9 UK-OXFORD 22/06/63 14-Jan-98
GOVUS, CHRISTINE 9 UK-OXFORD 19/02/50 09-Nov-98
GUBBINS, RACHEL 9 UK-OXFORD 13/01/73 14-Dec-98
HAMILTON, HUGO 9 UK-OXFORD 28/03/55 16-Nov-98
HAYTER, ANDREW 9 UK-OXFORD 08/04/62 01-Mar-97
JENNINGS, NATALIE 9 UK-OXFORD 01/06/72 30-May-89
JONES, SIMON 9 UK-OXFORD 02/05/57 11-Jan-99
KHAVINSON, MARK 9 UK-OXFORD 27/09/52 01-Apr-99
LANDSBOROUGH, IAN 9 UK-OXFORD 15/05/75 01-Jul-98
LOVELL, EMILIE (NEE JOHNS) 9 UK-OXFORD 14/01/73 10-Feb-97
MIDGELY, TOM 9 UK-OXFORD 31/12/51 18-Feb-99
MOFFATT, GEOFF 9 UK-OXFORD 17/06/42 01-Jun-99
ORLANDO, PAULINE 9 UK-OXFORD 19/06/43 01-Mar-78
PENFOLD, LYNN (P/T) 9 UK-OXFORD 19/02/64 19-Jul-99
SINGH, CAROLINE 9 UK-OXFORD 30/08/79 16-Nov-98
SMITH, JONATHAN 9 UK-OXFORD 06/03/62 14-Dec-98
SMITH, LISA 9 UK-OXFORD 30/12/69 14-Dec-98
SMITH, ALBAN 9 UK-OXFORD 18/07/62 03-Feb-92
SULLIVAN, MICHAEL 9 UK-OXFORD 20/09/61 24-Oct-88
VOGT, SJOERD 9 UK-OXFORD 09/06/57 04-Sep-90
WILKINSON, STEPHEN 9 UK-OXFORD 16/02/69 07-Dec-98
WILLIAMS, SIMON 9 UK-OXFORD 24/09/57 14-Nov-98
WOODWARD, MARILYN 9 UK-OXFORD 05/07/47 15-Mar-99
EDGE, RAY 20 SWITZERLAND 12/02/63 01-Dec-93
DOBSON, SHARON 26 HOME 04-Oct-99
McCOURT, CATHERINE 26 HOME 04-Oct-99
BUTLER, TERESA 30 SCOTLAND 08/12/70 02-Aug-99
DALY, TOM 30 SCOTLAND 07-Feb-00
KING, ALAN 30 SCOTLAND 31/03/69 12-Apr-99
LANG, DAVID 30 SCOTLAND 27/02/61 01-May-96
MULLEN, JAQUELINE 30 SCOTLAND 03-Dec-99
OWEN, BEN 31 SPAIN 05/01/68 01-Nov-93
CALLAN, BERNARD 36 BAHRAIN 05/07/68 11-Jan-95
BELCHER, MARK 1 UK-LONDON BR 29/03/71 04-Jan-99
BRIDCUT, PHILLIP 1 UK-LONDON BR 04/02/72 05-Jul-99
CASSIDY, SUSAN 1 UK-LONDON BR 09/11/63 21-Oct-91
CUTLER, JENNIFER 1 UK-LONDON BR 10-Jan-00
DYHRE, ANNA 1 UK-LONDON BR 30/06/70 01-Sep-98
HAIR, SIMON 1 UK-LONDON BR 06/04/67 30-Mar-98
O'SHAUGHNESSY, PAUL 1 UK-LONDON BR 22/07/70 18-Aug-98
ROCHFORD, BRIAN 1 UK-LONDON BR 13/06/64 24-Jun-96
ABDULLAH, ABBEY 2 UK-LEICESTER SQ 02/09/68 26-Apr-99
AGOH, HENRY 2 UK-LEICESTER SQ 07/01/62 04-Aug-90
BIRCH, KEELEY 2 UK-LEICESTER SQ 19/03/79 12-Jan-98
DAVIS, STEPHEN JOHN 2 UK-LEICESTER SQ 09/07/70 27-Apr-98
O'CANSEY, JACQUELINE (P/T) 2 UK-LEICESTER SQ 16/02/79 06-May-98
SMILLIE, CAROLINE 2 UK-LEICESTER SQ 18/10/71 11-Mar-96
WINDELL, LYNN 2 UK-LEICESTER SQ 05/09/67 01-Dec-97
BYRNE, MARC 3 UK-LONDON BR 14/10/73 01-Jul-99
CLARKE, DONNETT 3 UK-LONDON BR 08-Nov-99
<PAGE>
DEMPSEY, JULIETTE 3 UK-LONDON BR 23/12/70 19-Apr-99
GAFF, SHARON 3 UK-LONDON BR 24/11/68 15-Jun-98
GREGORY, HEIDI 3 UK-LONDON BR 13/12/75 05-Oct-98
HYATT, ANITA 3 UK-LONDON BR 03/12/68 01-Mar-99
KRAHFORST, URSULA 3 UK-LONDON BR 07/06/64 01-Aug-97
MCINTYRE, DAVID 3 UK-LONDON BR 27/05/60 21-Dec-98
SMITH, NICOLA 3 UK-LONDON BR 06/05/72 05-Jan-98
KING, NICOLA 4 UK-LONDON BR 08/04/72 24-Sep-97
McART, RUPERT 4 UK-LONDON BR 15-Nov-99
WIGHTMAN, LAUREN 4 UK-LONDON BR 10/09/65 01-Mar-99
YOUNG, DEREK 5 UK-LEICESTER SQ 14/02/66 10-Jun-96
KRISHNAN, VIJI 8 UK-LEICESTER SQ 03/08/63 16-Sep-96
MATTER, ROSEMARIE 8 UK-LEICESTER SQ 11/06/51 05-Feb-98
OBENG-DAUDA, PEACE 8 UK-LEICESTER SQ 23/03/74 13-Sep-99
ROLANDEZ, MAGALI 8 UK-LEICESTER SQ 11-Oct-99
STERN, SAM 8 UK-LEICESTER SQ 20/02/68 01-Jan-99
TSANG, ESTHER 8 UK-LEICESTER SQ 04/07/72 09-May-95
BUTLER, JOANNE 10 UK-LONDON BR
CAISTER, ANNE 10 UK-LONDON BR 07/07/71 31-Aug-99
DUGGAN, JULIA 10 UK-LONDON BR 18/03/71 16-Mar-98
LARNER, MICHAEL 10 UK-LONDON BR
LEVY, RICHARD 10 UK-LONDON BR 31/01/71 02-Nov-98
LOGAN, NICOLA 10 UK-LONDON BR 21/12/72 01-Sep-90
MCCAFERTY, GAIL 10 UK-LONDON BR
MYNOTT, NATASHA 10 UK-LONDON BR 09/01/73 06-Mar-00
PESTER, CHARLOTTE 10 UK-LONDON BR
SEALS, SHARON 10 UK-LONDON BR 19/09/69 05-May-98
WEBB, TONY 10 UK-LONDON BR 28/01/63 02-Oct-95
O'CONNOR, SARAH 11 UK-LONDON BR 17/05/70 14-Sep-98
STURGESS, GRAHAM 11 UK-LONDON BR 23/04/61 06-Oct-95
BARRAH, JESSICA 13 UK-LEICESTER SQ 21/09/73 30-Mar-98
COMPER, JANE 13 UK-LEICESTER SQ 16/08/74 19-Dec-94
DHENDSA, NINA 13 UK-LEICESTER SQ 29/11/72 01-Sep-92
FARMA, SEEMA 13 UK-LEICESTER SQ 13/09/75 06-Oct-97
GROVES, JAMIE 13 UK-LEICESTER SQ 17/01/78 17-May-99
JOYCE, CLAIRE 13 UK-LEICESTER SQ 08/07/74 01-Sep-92
MACKINTOSH, ETHAN 13 UK-LEICESTER SQ 10/03/73 02-Nov-98
MACLEOD, ELIZA 13 UK-LEICESTER SQ 19/10/71 25-Mar-96
SAUNDERS, HELEN 13 UK-LEICESTER SQ 18/09/76 15-Jan-96
STOKES, ALISON 13 UK-LEICESTER SQ 07/10/73 14-Sep-92
SUWARIS, NIMNA 13 UK-LEICESTER SQ 28/07/70 01-Sep-92
MORTON, CIARAN 14 UK-LONDON BR 01/12/63 01-Oct-91
BOWYER, NEIL 14 UK-LONDON BR 17/04/47 20-Nov-95
GOUGH, RACHEL 14 UK-LONDON BR 23/05/69 23-Jul-86
CARR, SARAH 17 UK-LEICESTER SQ 24/05/79 12-Jul-99
GIBBS, CARY 17 UK-LEICESTER SQ 15/01/72 10-Jun-96
HORTON, MARK 17 UK-LONDON BR 25/04/75 27-Jul-98
CHIDLEY, LUCY 18 UK-LEICESTER SQ 14/07/74 10-Aug-98
DIGGINS, MICHAEL 18 UK-LEICESTER SQ 03/07/51 03-Aug-98
MCCANN, BRENDAN 18 UK-LEICESTER SQ
ATKINSON, NICHOLAS 20 UK-LEICESTER SQ 30/10/67 05-Feb-96
BARRIO, DAVID 20 UK-LEICESTER SQ 09/08/67 24-Mar-97
BELL, JEREMY 20 UK-LEICESTER SQ 30/07/49 20-May-96
BERNHARDT, HEIKE 20 UK-LEICESTER SQ 07/08/62 09-Oct-95
BEST, WENDY 20 UK-LEICESTER SQ 19/05/71 10-Jul-95
CARTER, NEIL 20 UK-LEICESTER SQ 12/03/70 12-Jan-98
CORPS, DUNCAN 20 UK-LEICESTER SQ 10/04/72 12-May-97
<PAGE>
DAGLESS, GRAHAM 20 UK-LEICESTER SQ 09/07/62 11-Aug-97
FRANCE, JASON 20 UK-LEICESTER SQ 01-Sep-99
HANSEN, NORMAN 20 UK-LEICESTER SQ 29-Nov-99
HATHAWAY, ROBERT 20 UK-LEICESTER SQ 22/03/52 02-Aug-99
HUMPHREY, GORDON 20 UK-LEICESTER SQ 17/05/50 01-Aug-96
HUYNH, CHARLES 20 UK-LEICESTER SQ 02/06/69 15-Apr-96
HUYNH, SANDY 20 UK-LEICESTER SQ 26/01/71 01-Feb-93
KELLY, MIKE 20 UK-LEICESTER SQ 12/02/61 10-Apr-95
LARRINGTON, DAVID 20 UK-LEICESTER SQ 13/02/64 06-Aug-97
MALLER, STEPHEN 20 UK-LEICESTER SQ 06/01/59 01-Sep-91
MALONE, PAUL 20 UK-LEICESTER SQ 10/02/70 02-Jun-99
MCGOVERN, CATH 20 UK-LEICESTER SQ 02/12/68 01-Mar-90
MONTGOMERY, KEN 20 UK-LEICESTER SQ 09/10/70 10-May-99
NAGY, CONRAD 20 UK-LEICESTER SQ 05/04/65 18-Sep-95
PATEL, AJAY 20 UK-LEICESTER SQ 13-Sep-99
PEIRIS, SHERMAN 20 UK-LEICESTER SQ 07-Sep-99
SHULMAN, JULIAN 20 UK-LEICESTER SQ 01/12/63 10-Jul-97
SIVADASAN, SHANTHI 20 UK-LEICESTER SQ 10/05/68 18-Apr-94
SMITH, RICHARD 20 UK-LEICESTER SQ 26/08/43 22-Aug-94
TANK, PARVIN 20 UK-LEICESTER SQ 01/01/67 01-Aug-91
VIGNESWAREN, ANTON 20 UK-LEICESTER SQ 21/03/66 10-May-99
WESSON, DAVID 20 UK-LEICESTER SQ 26/02/72 26-Apr-99
YEUNG, MICHAEL 20 UK-LEICESTER SQ 30/06/64 06-Jun-92
BROCKWELL, CHRIS 22 UK-LONDON BR 09/03/72 21-Jun-99
CHISLETT, ZOE 22 UK-LONDON BR 26/11/74 22-Feb-99
DAVIES, DANIEL 22 UK-LONDON BR 09/05/75 26-Oct-98
FAIRHALL, CELESTINE 22 UK-LONDON BR 08-Nov-99
BRIGGS, DOROTHY 24 UK-LONDON BR 18/05/63 04-Oct-99
DAVIS, ANDREW 24 UK-LONDON BR 19/08/66 01-Jul-98
GOLDING, TRACEY 24 UK-LONDON BR 26/10/70 29-Mar-99
HUNTER, JOANNE 24 UK-LONDON BR 30/09/75 05-Aug-96
SILVESTER, JACQUELINE 24 UK-LONDON BR 27/05/69 03-Mar-97
WOOD, ADAM 24 UK-LONDON BR 05/05/65 01-Jul-93
GASCOIGNE, BRINSLEY 25 UK-LEICESTER SQ 30/03/63 18-Mar-99
OSBORNE, SIMON 25 UK-LEICESTER SQ 26/04/76 17-Sep-98
SCOTT, PAUL 25 UK-LEICESTER SQ 19/06/74 02-Aug-99
SLATER, TIM 25 UK-LEICESTER SQ 28/05/76 05-Jul-99
TURNER,NICHOLAS 25 UK-LEICESTER SQ 06-Dec-99
BARROWCLOUGH, HENRY 26 UK-LONDON BR 19/06/72 28-Jun-99
BATH, SIMON 26 UK-LONDON BR 26/07/75 06-Apr-99
BROWN, AMANDA 26 UK-LONDON BR 20/11/76 09-Aug-99
BURKE, CHRISTINE 26 UK-LONDON BR 31/12/70 01-Jun-98
COLE, GAWIN 26 UK-LONDON BR 14/03/74 17-Aug-98
CROOK, CHLOE 26 UK-LONDON BR 15/09/74 07-Jun-96
DAVIES, TONY 26 UK-LONDON BR 07/05/69 15-Mar-99
DRAKE, YVONNE 26 UK-LONDON BR 21/08/73 10-May-99
GAUNT, SIMON 26 UK-LONDON BR 29/01/73 10-May-99
HAMMERSLY, EMMA 26 UK-LONDON BR 13/11/72 10-Aug-98
HISCOCK, ALEX 26 UK-LONDON BR 28/07/70 05-Jul-99
KING, RAY 26 UK-LONDON BR 23/04/69 11-Aug-97
LANE, NICHOLAS 26 UK-LONDON BR 06/11/62 02-Feb-94
RAWORTH, JOANNA 26 UK-LONDON BR 27/06/75 07-Jun-99
SHIELDS, CHRISTOPHER 26 UK-LONDON BR 24/08/74 21-Feb-00
SIDEY, KELLY 26 UK-LONDON BR 07/05/78 01-Jul-98
WEBBER, PAUL 26 UK-LONDON BR 13/08/75 16-Nov-98
WOODBRIDGE, AMY 26 UK-LONDON BR 20-Sep-99
SMART nee HAMPSON, C 28 UK-LEICESTER SQ 09/04/75 15-Apr-96
<PAGE>
BENNETT, SHEILA 29 UK-LONDON BR 04/03/63 04-Dec-89
BROWNE (NEE GREEN), LINDA 29 UK-LONDON BR 29/04/60 20-Feb-95
HEFFERNAN, TESSA 29 UK-LONDON BR 24/05/56 01-Aug-85
FORD, JO 32 UK-LONDON BR 27/06/72 23-Oct-95
ABBEY, KATRINA 33 UK-LONDON BR 02/06/72 22-Jan-96
BATES, SARAH 33 UK-LONDON BR 07/09/66 14-Feb-00
CULLETON, REBECCA 33 UK-LONDON BR 07/02/80 19-Jan-98
DEOGRACIAS, NATALIE 33 UK-LONDON BR 20/06/74 29-Mar-99
FECCI, VICTORIA 33 UK-LONDON BR 04-Oct-99
HOLTON, JENNIFER 33 UK-LONDON BR 03/11/75 28-Sep-98
TAYLOR, SOPHIE 33 UK-LONDON BR 12/09/75 24-May-99
SHEVILLE, WENDY 35 UK-LONDON BR 15/12/51 04-Mar-96
BARTLEY, VALERIE 37 UK-LEICESTER SQ 09/03/55 08-Oct-84
JONES, MEGAN 37 UK-LEICESTER SQ 05/05/67 23-Nov-98
MOORE-FITZGERALD, LINDSEY 37 UK-LEICESTER SQ 03/01/71 06-May-98
COUSINS, NATALIE 17 UK-LEICESTER SQ 27/01/75 08-Mar-99
BEVERIDGE, RICHARD 46 UK-LONDON BR 03/12/69 20-Jul-98
Totals Salaries
KEY TO NUMBERS
ACCOUNT MANAGER LB 1
ACCOUNTS 2
ACCOUNTS LB 3
ACCOUNTS SALES SUPP LB 4
ADMIN 5
AGENT 6
ALLIANCES 7
BACD 8
CD-ROM 9
CLIENT SUPP SERVICE 10
CORP TRAINING 11
DTI 12
EDITORIAL 13
EURO SALES DIRECTOR 14
EXEC 15
EXEC P/A 16
GLOBAL MARKETING 17
HUMAN RESOURCES 18
I.R. 19
INFO D 20
LB ADMIN 22
LEGAL 23
MARKETING LB 24
NETWORK SUPPORT 25
NEW BUSINESS SALES LB 26
NON EXEC 27
PRODUCT PRICING 28
SALES SUPPORT LB 29
SCOTLAND 30
SPAIN 31
TECH SALES LB 32
VAX 33
WEBTOP 34
AGENT LB 35
BAHRAIN 36
DATASTAR 37
<PAGE>
ENTERPRISE SOL - FINANCE 38
ENTERPRISE SOL - H/R ADMIN 39
ENTERPRISE SOL - OBJECT MUS 40
ENTERPRISE SOL - OPS CAM 41
ENTERPRISE SOL - SALES CAM 42
ENTERPRISE SOL - SALES LB 43
OFFICE SHOPPER 44
SPARZA 45
TRAINING MANAGER 46
<PAGE>
JOBTITLE Comments
ADMINISTRATIVE ASSISTANT CDROM
TEMP SALES & MARKETING CDROM
PROJECT MANAGER CDROM
PROJECT MANAGER CDROM
DATABASE DEVELOPER CDROM
SALES MANAGER CDROM
TECHNICAL WRITER CDROM
OFFICE MANAGER CDROM
CREDIT CONTROLLER CDROM
MANAGEMENT ACCOUNTANT CDROM
CONTENT DIRECTOR - CD-ROM CDROM
ADMINISTRATION SUPERVISOR CDROM
TECHNOLOGY DIRECTOR CDROM
Q/A SPECIALIST CDROM
BUSINESS DEVELOPMENT EXEC CDROM
SALES REPRESENTATIVE (P/T) CDROM
DATABASE DEVELOPER CDROM
SALES MARKETING EXEC CDROM
DEPARTMENT ASSISTANT CDROM
ADMINISTRATIVE ASSISTANT CDROM
ADMINISTRATIVE ASSISTANT CDROM
QA SPECIALIST CDROM
ACCOUNTS ASSISTANT CDROM
SALES REPRESENTATIVE CDROM
SALES REPRESENTATIVE CDROM
GENERAL MANAGER CDROM
ADMIN.SUPPORT ASSISTANT CDROM
SYSTEMS ENGINEER CDROM
RECEPTIONIST CDROM
PROJECT MANAGER ISD
SALES EXEC ISD
SALES EXEC ISD
BUSINESS DEV EXEC ISD
AREA ACCOUNT MANAGER ISD Left 15/3
SALES EXECUTIVE ISD
REGIONAL MANAGER ISD
SECRETARY/ADMIN ISD
COUNTRY MANAGER - SPAIN ISD
CORPORATE ACCOUNT MANAGER ISD
ACCOUNT MANAGER ISD - L
ACCOUNT MANAGER ISD - L
SALES REPRESENTATIVE, SR. ISD - L
SNR ACCOUNT MANAGER ISD - L
ACCOUNT MANAGER ISD - L
ACCOUNT MANAGER ISD - L
CORPORATE ACCOUNT MANAGER ISD - L
SALES EXECUTIVE II ISD - L
FINANCIAL ANALYST ISD - L
MANAGEMENT ACCOUNTANT ISD - L
JUNIOR ACCOUNTS ASSISTANT ISD - L
SENIOR MANAGEMENT ACCOUNTANT ISD - L
ACCOUNTS ASSISTANT ISD - L
ACCOUNTS ASSISTANT ISD - L
GROUP TREASURER ISD - L
MANAGEMENT ACCOUNTANT ISD - L
BOUGHT LEDGER CLERK ISD - L Leaves 31/3
<PAGE>
SNR. MANAGEMENT ACCOUNTANT ISD - L Leaves 23/3
UK CREDIT MANAGER ISD - L
MANAGEMENT ACCOUNTANT ISD - L
OHD ACCTS ISD - L
CREDIT CONTROLLER ISD - L
CFO-EMEA ISD - L
SNR CREDIT CONTROLLER ISD - L
SALES ADMINISTRATOR ISD - L
BUSINESS ANALYST ISD - L
SALES ADMINISTRATOR ISD - L
OFFICE SERVICES ASSISTANT ISD - L
PROJECT MANAGER ISD - L
DATASTAR AND TRADSTAT ISD - L
CONTENT SERVICES EXEC ISD - L
CONTENT MANAGER - BUSINESS ISD - L
SENIOR CONTENT MANAGER ISD - L
EDITORIAL TECHNICAL LIAISON ISD - L Leaves 17/3
CLIENT SERVICES EXECUTIVE ISD - L Starts 6/3
CLIENT SERVICES EXECUTIVE ISD - L
CLIENT SERVICE EXECUTIVE ISD - L Leaves 10/3
CLIENT SERVICES EXECUTIVE ISD - L Starts 6/3
CLIENT SERVICES EXEC ISD - L
CLIENT SERVICES EXEC ISD - L
CLIENT SERVICES EXECUTIVE ISD - L Starts 20/3
Temp 6/3/00 to
CLIENT SERVICES EXECUTIVE ISD - L 26/5/00
ADMIN ASSISTANT ISD - L Starts 13/3
CLIENT SERVICES EXECUTIVE ISD - L Leaves 10/3
HELP DESK ADMINISTRATOR ISD - L
TEMP PROJECT TRAINING & SUPPORT ISD - L
TRAINING MANAGER ISD - L
EDITORIAL ASSISTANT ISD - L
EDITORIAL ASSISTANT ISD - L
EDITORIAL PRODUCTION MANAGER ISD - L
EDITORIAL ASSISTANT ISD - L
CONTENT GROUP ASST ISD - L
EDITORIAL ASSISTANT ISD - L
INDEXING ASSISTANT ISD - L
EDITORIAL ASSISTANT ISD - L
EDITORIAL ASSISTANT ISD - L
EDITORIAL ASSISTANT ISD - L
EDITORIAL ASSISTANT ISD - L
PRESIDENT, EMEA ISD - L
Contractual three
COUNTRY MANAGER ISD - L month notice period
PA/SYSTEMS ADMIN ISD - L
CONTENT PRODUCTION ASST ISD - L
WEB DEVELOPER ISD - L
WEB PROGRAMMER ISD - L
HUMAN RESOURCES EXEC ISD - L
PAYROLL/HR ADMINISTRATOR ISD - L
EMEA HR DIRECTOR ISD - L Starts 3/4
DEVELOPMENT MANAGER ISD - L Leaves 17/3
ANALYST PROGRAMMER ISD - L
ANALYST PROGRAMMER ISD - L
TECHNICAL PROJECT MANAGER ISD - L
SENIOR TEST ENGINEER ISD - L
SENIOR MANAGEMENT ACCOUNTANT ISD - L Leaves 31/3
ANALYST PROGRAMMER ISD - L
<PAGE>
ANALYST PROGRAMMER ISD - L
UNIX SYSTEMS ADMIN ISD - L
DEVELOPMENT ENGINEER ISD - L
ANALYST PROGRAMMER ISD - L
ANALYST PROGRAMMER ISD - L
DATABASE ADMINISTRATOR ISD - L
ANALYST PROGRAMMER ISD - L
ANALYST PROGRAMMER ISD - L Incl. sal increase 3/00
ANALYST PROGRAMMER ISD - L
IT DIRECTOR ISD - L
Q/A ENGINEER ISD - L
SOFTWARE TESTER ISD - L
SENIOR ANALYST PROGRAMMER ISD - L
ANALYST PROGRAMMER ISD - L
ANALYST PROGRAMMER ISD - L
SOFTWARE TESTER ISD - L
ANALYST PROGRAMMER ISD - L
DATABASE ADMINISTRATOR ISD - L
ANALYST PROGRAMMER ISD - L
DATABASE DEVELOPMENT MANAGER ISD - L
SYSTEMS ACCEPTANCE TESTER ISD - L
ANALYST PROGRAMMER ISD - L
SENIOR SYSTEMS DESIGNER ISD - L
OFFICE MANAGER ISD - L
RECEPTIONIST ISD - L
OFFICE ASSISTANT ISD - L
RECEPTIONIST ISD - L
Contractual two month
VP - EMEA MARKETING ISD - L notice period
MARKETING COMMUNICATIONS EXEC ISD - L
MARKETING CO-ORDINATOR ISD - L
MARKETING ASSISTANT ISD - L
MARKETING EXECUTIVE ISD - L
MARKETING SERVICES ISD - L
NETWORK SUPPORT ANALYST ISD - L
NETWORK SUPPORT ISD - L
NETWORK SUPPORT ANALYST ISD - L
NETWORK SUPPORT ANALYST ISD - L
NETWORK SUPPORT ANALYST ISD - L
SALES EXECUTIVE ISD - L
ACCOUNT DEVELOPMENT EXECUTIVE ISD - L
BUSINESS DEV EXEC ISD - L
BUSINESS DEVELOPMENT EXEC ISD - L
BUSINESS DEVELOPMENT EXEC ISD - L
BUSINESS DEV EXEC ISD - L
NEW SALES EXEC ISD - L
SALES CO-ORDINATOR ISD - L
BUSINESS DEV EXEC ISD - L
BUSINESS DEVELOPMENT EXEC ISD - L Leaves 31/3
BUSINESS DEV EXEC ISD - L
BUSINESS DEVELOPMENT EXECUTIVE ISD - L
HEAD OF GENERAL BUSINESS TEAM ISD - L
BUSINESS DEVELOPMENT EXEC ISD - L Leaves 31/3
SALES EXECUTIVE ISD - L Started 21/2
BUSINESS DEVELOPMENT EXEC ISD - L
TELESALES EXECUTIVE ISD - L
BUSINESS DEVELOPMENT EXEC ISD - L
ASSISTANT MANAGER PUBLISHING ISD - L
<PAGE>
SALES REPRESENTATIVE, SR. ISD - L
SALES REPRESENTATIVE ISD - L
SALES ADMINISTRATOR ISD - L
NETWORK INSTALLATION EXECUTIVE ISD - L
VAX CLIENT SUPPORT TEAM LEADER ISD - L
CUSTOMER ADMIN ASSISTANT ISD - L Started 14/2
CUSTOMER ADMIN ASSISTANT ISD - L
CUSTOMER ADMIN ASSISTANT ISD - L
CUSTOMER ADMIN ASSISTANT ISD - L
CUSTOMER ADMIN ASSISTANT ISD - L
CUSTOMER ADMIN ASST ISD - L
ADMINISTRATIVE ASSISTANT ISD - L
DATABASE MANAGER II ISD - L
CLIENT SERVICES EXECUTIVE ISD - L
CLIENT SERVICES EXECUTIVE ISD - L
CONTENT SERVICES EXECUTIVE ISD - L
CLIENT SERVICES MANAGER ISD - L
LONDON - WSD/CORP & ECD 0
LONDON ISD 149
CAMBRIDGE (Incl 1 in USA) 0
OFFICE SHOPPER & SPARZA 0
OXFORD - CDROM 28
WEMBLEY 0
OTHER ISD 9
Grand Total 186
Newco Central London 0
Newco Total UK (Incl 1 in USA) 0
Total ISD UK 186
Currently at LB 78
<PAGE>
125
SCHEDULE 10
DOMAIN NAMES
<PAGE>
PART 1
-----------------------------------------------------------------------
TRIO
DOMAIN US PLC KR MAID Other
-----------------------------------------------------------------------
ASKOUREXPERT.COM X
-----------------------------------------------------------------------
ASKTHESPECIALIST.COM X
-----------------------------------------------------------------------
B2BANSWERS.COM X
-----------------------------------------------------------------------
BIZALERT.COM X
-----------------------------------------------------------------------
BROKERLINE.COM X
-----------------------------------------------------------------------
BUSINESSBASE.NET X
-----------------------------------------------------------------------
COMPANYLINE.COM X
-----------------------------------------------------------------------
CUSTOMALERT.COM X
-----------------------------------------------------------------------
DATASTARWEB.COM X
-----------------------------------------------------------------------
DIALOG.CO.UK X
-----------------------------------------------------------------------
DIALOG.COM X
-----------------------------------------------------------------------
DIALOG1.COM X
-----------------------------------------------------------------------
DIALOG-ACCTDEV.COM X
-----------------------------------------------------------------------
DIALOGAGRO.COM X
-----------------------------------------------------------------------
DIALOGATSITE.COM X
-----------------------------------------------------------------------
DIALOGBUSINESS.COM X
-----------------------------------------------------------------------
DIALOGCHEM.COM X
-----------------------------------------------------------------------
DIALOGCLASSIC.COM X
-----------------------------------------------------------------------
DIALOGCORP.CO.UK X
-----------------------------------------------------------------------
DIALOGCORP.COM X
-----------------------------------------------------------------------
DIALOGCORP.COM X
-----------------------------------------------------------------------
DIALOGCORPPLC.COM X
-----------------------------------------------------------------------
DIALOGCORP-PLC.COM X
-----------------------------------------------------------------------
DIALOGENERGY.COM X
-----------------------------------------------------------------------
DIALOGENVIRON.COM X
-----------------------------------------------------------------------
DIALOGFINANCE.COM X
-----------------------------------------------------------------------
DIALOGFOOD.COM X
-----------------------------------------------------------------------
DIALOGGOV.COM X
-----------------------------------------------------------------------
DIALOGINFO.COM X
-----------------------------------------------------------------------
DIALOGIP.COM X
-----------------------------------------------------------------------
DIALOGMED.COM X
-----------------------------------------------------------------------
DIALOGNEWS.COM X
-----------------------------------------------------------------------
DIALOGPHARMA.COM X
-----------------------------------------------------------------------
DIALOG-PLC.CO.UK X
-----------------------------------------------------------------------
DIALOGPLC.COM X
-----------------------------------------------------------------------
DIALOGPLC.COM X
-----------------------------------------------------------------------
DIALOG-PLC.COM X
-----------------------------------------------------------------------
DIALOGSELECT.COM X
-----------------------------------------------------------------------
DIALOGSOLUTIONS.COM X
-----------------------------------------------------------------------
DIALOGSPORTS.COM X
-----------------------------------------------------------------------
DIALOGTECH.COM X
-----------------------------------------------------------------------
DIALOGWEB.COM X
-----------------------------------------------------------------------
DIALOGWEBFOUNDRY.COM X
-----------------------------------------------------------------------
EXPERTSEARCHER.COM X
-----------------------------------------------------------------------
KRINFO.COM X
-----------------------------------------------------------------------
MYPROFOUND.COM X
-----------------------------------------------------------------------
PROFOUND.CO.UK X
-----------------------------------------------------------------------
PROFOUND.DE X
-----------------------------------------------------------------------
PROFOUNDBRIEFINGS.COM X
-----------------------------------------------------------------------
RESEARCHDIALOG.COM X
-----------------------------------------------------------------------
TRADSTAT.COM X
-----------------------------------------------------------------------
<PAGE>
-----------------------------------------------------------------------
DOMAIN US PLC KR MAID Other
-----------------------------------------------------------------------
TRAD-STAT.COM X
-----------------------------------------------------------------------
TRADSTATDIRECT.COM X
-----------------------------------------------------------------------
TRADSTATWEB.CO.UK X
-----------------------------------------------------------------------
TRADSTAT-WEB.CO.UK X
-----------------------------------------------------------------------
TRADSTATWEB.COM X
-----------------------------------------------------------------------
TRADSTAT-WEB.COM X
-----------------------------------------------------------------------
VBINFO.COM X
-----------------------------------------------------------------------
VIRTUALPUBLISHING.COM X
-----------------------------------------------------------------------
WONOA.COM X
-----------------------------------------------------------------------
<PAGE>
PART 2
DOMAIN NAMES--TRIO TO NEWCO
K-WORK.COM
WEB-TOP.CO.UK
WEBTOP.COM
WWWTOP.COM
<PAGE>
126
Signed by } /S/Anna E. Jordan Couti
for THE DIALOG CORPORATION PLC -------------------------
as Attorney under the Deed of Power of
Attorney dated March 22, 2000
Signed by } /S/Gordan A. Friedland
for THE THOMSON CORPORATION -------------------------
Vice President
126
